Exhibit 10(h)
NOMINATING AGREEMENT
This Nominating Agreement (this "Agreement") is made and entered
into as of July 2, 2002 by and between Prandium, Inc., a Delaware corporation
(the "Company"), and MacKay Xxxxxxx LLC (formerly known as MacKay Xxxxxxx
Financial Corporation), a Delaware limited liability company ("MacKay").
This Agreement is made in connection with securing MacKay's
approval with respect to the chapter 11 reorganization (the "Reorganization") of
the Company and its wholly-owned subsidiary, FRI-MRD Corporation ("FRI-MRD").
For good and valuable consideration, the receipt and adequacy of
which are hereby acknowledged, the parties hereto agree as follows:
SECTION 1. Definitions. Unless the context otherwise requires,
(a) "Affiliate" has the meaning given to that term in Rule
12b-2 under the Securities Exchange Act of 1934, as amended.
(b) "FRI-MRD Notes" means FRI-MRD's 12% Senior Notes due
January 31, 2005.
(c) "person" means any individual, corporation, general or
limited partnership, joint venture, trust or other entity or association,
including without limitation any governmental authority.
(d) "Organizational Documents" means the Certificate of
Incorporation and by-laws of the Company.
SECTION 2. Board Representation.
(a) Until the principal and premium (if any) and interest
on the FRI-MRD Notes have been paid in full:
(i) the Company shall use its best efforts to cause
the Board of Directors of the Company (the "Board of Directors") to limit its
size to no more than five directors and to include the MacKay Designee (as
defined below) as one of its members;
(ii) the Company shall support the nomination of,
and use its best efforts to cause the Board of Directors to include in the slate
of nominees recommended to stockholders for election as directors, one person
designated by MacKay (the "MacKay Designee");
(iii) if any vacancy (whether by death, retirement,
disqualification, removal from office or other cause) is created by a MacKay
Designee
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ceasing to serve as a director, the Board of Directors shall appoint a person
designated by MacKay to fill such vacancy, and such person shall be the MacKay
Designee for purposes of this Agreement;
(iv) the Company shall not amend its Organizational
Documents in a manner that adversely affects the rights of MacKay hereunder; and
(v) the MacKay Designee shall be a member of the board of
directors (or similar governing body) of any subsidiary of the Company at any
time such subsidiary's board of directors is made up of persons other than
management;
provided, however, that, notwithstanding the foregoing, the Company shall not be
required to take any action which it reasonably believes is unlawful, and shall
be allowed to take any action the omission of which it reasonably believes would
be unlawful.
(b) Notwithstanding the provisions of this Section 2, MacKay
shall not be entitled to designate any person to the Board of Directors if:
(i) such person is an Affiliate of MacKay; or
(ii) the Company receives a written opinion of its outside
counsel that such person would not be qualified under any applicable law, rule
or regulation to serve as a director of the Company.
The Company shall notify MacKay in writing of the date on which proxy materials
are expected to be mailed by the Company in connection with an election of
directors (and such notice shall be delivered to MacKay at least 30 days prior
to such expected mailing date). The Company shall use its reasonable best
efforts to notify MacKay of any objection to a MacKay Designee sufficiently in
advance of the date on which such proxy materials are to be mailed by the
Company in connection with such election of directors so as to enable MacKay to
propose a replacement MacKay Designee in accordance with the terms of this
Agreement.
(c) If at any time prior to the termination of this Agreement
the Board of Directors of the Company or, pursuant to Section 2(a)(v), any
Subsidiary, as applicable, does not include a MacKay Designee, MacKay shall have
the right to: (i) appoint a non-voting representative to attend meetings of such
Board of Directors and (ii) receive copies of any materials to be distributed or
discussed at such meetings at the same time as provided to members of such Board
of Directors.
(d) Each MacKay Designee serving on the Board of Directors shall
be entitled to all compensation and stock incentives granted to directors who
are not employees of the Company, as well as the benefits of any directors'
liability insurance policy, in each case, on the same terms provided to the
other such directors.
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SECTION 3. MISCELLANEOUS
(a) Notices. All notices and other communications
provided for or permitted hereunder shall be in writing and shall be deemed
given (i) when made, if made by hand delivery, (ii) upon confirmation, if made
by facsimile or e-mail, or (iii) one business day after being deposited with a
reputable next-day courier, postage prepaid, to the parties, at their address
set forth under their respective signatures on the execution pages hereof, or to
such other address as any party may have furnished to the other parties in
writing in accordance herewith.
(b) Entire Agreement. This Agreement is intended by
the parties as a final expression of their agreement and is intended to be a
complete and exclusive statement of the agreement and understanding of the
parties hereto in respect of the subject matter contained herein.
(c) Amendment and Waiver; Binding Effect. This
Agreement may be amended, modified or supplemented, and waivers or consents to
departures from the provisions hereof may be given, provided that the same are
in writing and signed by each of the parties hereto. Notwithstanding anything to
the contrary contained herein, a waiver that does not adversely affect all of
the parties hereto may, in lieu of complying with the first sentence of this
Section 3(c), be executed only by the Company, MacKay and any other party
adversely affected thereby. This Agreement shall be binding upon, and shall
inure to the benefit of, the parties hereto and each of their respective
successors and assigns.
(d) Headings. The headings in this Agreement are for
convenience of reference only and shall not limit or otherwise affect the
meaning hereof.
(e) Severability. If any term, provision, covenant or
restriction of this Agreement is held by a court of competent jurisdiction to be
invalid, illegal, void or unenforceable, the remainder of the terms, provisions,
covenants and restrictions set forth herein shall remain in full force and
effect and shall in no way be affected, impaired or invalidated, and the parties
hereto shall use their best efforts to find and employ an alternative means to
achieve the same or substantially the same result as that contemplated by such
term, provision, covenant or restriction. It is hereby stipulated and declared
to be the intention of the parties that they would have executed the remaining
terms, provisions, covenants and restrictions without including any of such
which may be hereafter declared invalid, illegal, void or unenforceable.
(f) Governing Law. This Agreement shall be governed by
and construed in accordance with the laws of the State of Delaware, as applied
to contracts made and performed within the State of Delaware, without regard to
principles of conflict of laws.
(g) Counterparts. This Agreement may be executed in
any number of counterparts, and by the parties hereto in separate counterparts,
each of which
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when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement.
(h) Specific Performance. Each party hereto agrees
that irreparable harm, for which there may be no adequate remedy at law and for
which the ascertainment of damages would be difficult, would occur in the event
any of the provisions of this Agreement were not performed in accordance with
its specific terms or were otherwise breached. Each party hereto accordingly
agrees that each other party hereto shall be entitled to an injunction or
injunctions to prevent breaches of the provisions of this Agreement, or any
agreement contemplated hereunder and to enforce specifically the terms and
provisions hereof in any court of the United States or any state thereof having
jurisdiction, in each instance without being required to post bond or other
security and in addition to, and without having to prove the adequacy of, other
remedies at law.
(i) Further Assurances. Each party hereto agrees to
use all reasonable efforts to obtain all consents and approvals, and to do all
other things, necessary for the transactions contemplated by this Agreement. The
parties agree to take such further action and to deliver or cause to be
delivered any additional agreements or instruments as any of them may reasonably
request for the purpose of carrying out this Agreement and the agreements and
transactions contemplated hereby.
(j) Dispute Resolution. The parties hereto will use
their reasonable best efforts to resolve any disputes hereunder through good
faith negotiations. Any such dispute that cannot be so resolved within 30
calendar days (or such other period to which the parties may agree) will be
submitted to a panel of arbitrators (with each party to the dispute being
entitled to select one arbitrator and, if necessary to prevent the possibility
of deadlock, one additional arbitrator being selected by such arbitrators
selected by the parties to the dispute). Except as otherwise provided herein or
as the parties to the dispute may otherwise agree, such arbitration will be
conducted in accordance with the then-existing rules of the American Arbitration
Association. The decision of the arbitrators, or of a majority thereof, made in
writing will be final and binding upon the parties hereto as to the questions
submitted, and the parties will abide by and comply with such decision;
provided, however, the arbitrators shall not be empowered to award punitive
damages. Unless the decision of the arbitrators provides for a different
allocation of costs and expenses determined by the arbitrators to be equitable
under the circumstances, the prevailing party or parties in any arbitration will
be entitled to recover all reasonable fees and expenses incurred by it or them
in connection with such arbitration from the non-prevailing party or parties.
(k) Termination. This Agreement shall automatically
terminate upon payment in full of the principal and premium (if any) and
interest on the FRI-MRD Notes.
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IN WITNESS WHEREOF, each of the parties hereto has executed
this Agreement as of the date first above written.
PRANDIUM, INC.
By: /s/ X.X. Xxxxxxx, Xx.
---------------------
Name: X.X. Xxxxxxx, Xx.
Title: EVP/CFO
ADDRESS FOR NOTICES:
0000 Xxxxx Xxxxxxx
Xxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxx X. Xxxxxxx, Xx.
MACKAY XXXXXXX LLP
By: /s/ Xxxxxx Xxxx
-----------------
Name: Xxxxxx Xxxx
Title: General Counsel
ADDRESS FOR NOTICES:
0 Xxxx 00/xx/ Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Jordan Teramo
ACKNOWLEDGED AND AGREED
From and after the execution of this Nominating Agreement, at
any regular or special meeting of stockholders of the Company or in any written
consent ("Written Consent") executed in lieu of such a meeting of stockholders,
(a) each of the undersigned shall vote its voting securities of the Company
("Shares"), and each of the undersigned shall take all other actions necessary,
to give effect to the provisions of this Nominating Agreement, (b) none of the
undersigned shall vote its Shares in favor of any amendment of the
organizational documents of the Company which would conflict with, or purport to
amend or supersede, any of the provisions of this Nominating Agreement and (c)
in connection with any transfer of Shares by any of the undersigned occurring at
a time when such Shares are not listed on the New York Stock Exchange or any
other nationally recognized exchange, trading or quotation system or in
connection with any transfer of Shares to any of the undersigned or an Affiliate
of any of the undersigned, the transferor will cause any transferee of their
Shares to be subject to this paragraph with respect to such transferred Shares.
Holders of 9 3/4% Prandium Senior Notes
By: /s/ Xxxx Xxxxx
---------------
Name: Xxxx Xxxxx
Title: Managing Director
Imperial Capital, LLC
ADDRESS FOR NOTICES:
ACKNOWLEDGED AND AGREED
From and after the execution of this Nominating Agreement, at
any regular or special meeting of stockholders of the Company or in any written
consent ("Written Consent") executed in lieu of such a meeting of stockholders,
(a) each of the undersigned shall vote its voting securities of the Company
("Shares"), and each of the undersigned shall take all other actions necessary,
to give effect to the provisions of this Nominating Agreement, (b) none of the
undersigned shall vote its Shares in favor of any amendment of the
organizational documents of the Company which would conflict with, or purport to
amend or supersede, any of the provisions of this Nominating Agreement and (c)
in connection with any transfer of Shares by any of the undersigned occurring at
a time when such Shares are not listed on the New York Stock Exchange or any
other nationally recognized exchange, trading or quotation system or in
connection with any transfer of Shares to any of the undersigned or an Affiliate
of any of the undersigned, the transferor will cause any transferee of their
Shares to be subject to this paragraph with respect to such transferred Shares.
Holders of 9.75% Prandium Senior Notes
Xxxxxxxxxxx Millennium Strategic Income Fund
Xxxxxxxxxxx Champion Income Fund
Xxxxxxxxxxx Strategic Income Fund
Xxxxxxxxxxx Variable Account Funds for the account of:
Xxxxxxxxxxx Strategic Bond Fund
Xxxxxxxxxxx High Yield Fund
Xxxxxxxxxxx Variable Account Funds for the account of:
Xxxxxxxxxxx High Income Fund
Xxxxxxxxxxx Multi-Sector Income Trust
By: /s/ Xxxxxxxxx X. Xxxx
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Xxxxxxxxx X. Xxxx, Assistant Secretary
OppenheimerFunds, Inc. as investment adviser to
Atlas Strategic Income Fund
By: /s/ Xxxxxxxxx X. Xxxx
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Xxxxxxxxx X. Xxxx, Vice President
