Exhibit 10.1
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EXCHANGE AGREEMENT
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EXCHANGE AGREEMENT (this "Agreement"), dated as of December 19,
2003, by and among The Xxxxx Xxxxxx Companies Inc., a Delaware corporation (the
"Company"); Xxxxxx Xxxxxxxxx, as trustee (the "EL Trustee"), u/a/d as of June 2,
1994, as amended, between Xxxxx Xxxxxx ("EL"), as settlor, and Xxxxxxx X. Xxxxxx
("LAL"), Xxxxxx X. Xxxxxx ("RSL") and Xxx X. Xxxxxx ("ITW"), as trustees, and
known as "The Xxxxx Xxxxxx 1994 Trust Agreement" (the "1994 Trust"); LAL and
Xxxx X. Xxxxxxxxxx, as trustees (the "LAL Trustees"), u/a/d as of November 16,
1995, between EL, as settlor, and the LAL Trustees, and known as "The LAL 1995
Preferred Stock Trust Agreement" (the "LAL Trust"); LWG Family Partners L.P., a
Georgia limited partnership ("LWG Partners"), and RAJ Family Partners L.P., a
Georgia limited partnership ("RAJ Partners").
W I T N E S S E T H:
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WHEREAS, the 1994 Trust owns 2,916,000 shares of the Company's
$6.50 Cumulative Redeemable Preferred Stock, par value $0.01 per share (the
"$6.50 Preferred Stock");
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WHEREAS, the LAL Trust owns 683,980 shares of the $6.50
Preferred Stock;
WHEREAS, LWG Partners owns 10 shares of the $6.50 Preferred
Stock;
WHEREAS, RAJ Partners owns 10 shares of the $6.50 Preferred
Stock;
WHEREAS, the 1994 Trust desires to surrender to the Company
2,916,000 shares of $6.50 Preferred Stock in exchange for an aggregate of
291,600 newly issued shares of the Company's Series A Cumulative Redeemable
Preferred Stock, par value $0.01 per share (the "Series A Preferred Stock"),
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with the rights and preferences set forth in the proposed Certificate of
Designation, substantially in the form attached hereto as Exhibit A (the "Series
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A Designation"), to the Company's Restated Certificate of Incorporation, as
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amended (the "Certificate of Incorporation");
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WHEREAS, the LAL Trust desires to surrender to the Company
683,980 shares of $6.50 Preferred Stock in exchange for an aggregate of 68,398
newly issued shares of Series A Preferred Stock;
WHEREAS, the Company desires to accept the shares of $6.50
Preferred Stock from both the 1994 Trust and the LAL Trust and issue in exchange
therefor the Series A Preferred Stock;
WHEREAS, the parties intend that the exchanges of the $6.50
Preferred Stock for the Series A Preferred Stock qualify as a tax free
reorganization pursuant to Section 368(a) of the Internal Revenue Code of 1986,
as amended;
WHEREAS, each of LWG Partners and RAJ Partners desires to
surrender its ten (10) shares of $6.50 Preferred Stock for $1,000 in cash,
respectively; and
WHEREAS, in connection with the exchange, the parties to that
certain Registration Rights Agreement, dated November 22, 1995, as amended, by
and between the Company and the other parties set forth on the signature pages
thereof (the "Registration Rights Agreement"), desire to enter into an amendment
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to the Registration Rights Agreement with respect to the Series A Preferred
Stock, substantially in the form attached hereto as Exhibit C (the
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"Fourth Amendment").
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NOW, THEREFORE, in consideration of the premises and of the
mutual covenants hereinafter contained, the parties hereto hereby agree as
follows:
1. Exchange.
(a) On the Closing Date (as defined below), (i) the 1994
Trust, the LAL Trust, LWG Partners and RAJ Partners shall each deliver
to the Company at its address set forth in Section 6(e) hereof a stock
certificate or stock certificates evidencing the number of shares of
$6.50 Preferred Stock set forth opposite its name on Schedule 1 hereto,
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in each case duly endorsed in blank or with an executed blank stock
power attached thereto and with all required stock transfer stamps
attached thereto and (ii) the 1994 Trust and the LAL Trust shall each
deliver to the Company at its address set forth in Section 6(e) hereof
two copies of the Fourth Amendment, each manually signed by each of the
EL Trustee and the LAL Trustees. The "Closing Date" shall be December
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31, 2003 (or, if later, the date on which the Series A Designation
becomes effective); provided, however, that the Company shall not be
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required to file the Series A Designation unless and until all the
parties to the Registration Rights Agreement, other than the Company,
execute and deliver to the Company signed copies of the Fourth
Amendment.
(b) On the Closing Date, and simultaneously with the receipt
of the stock certificates and other documents as provided in Section 1
(a) hereof, the Company shall (i) issue the Series A Preferred Stock and
deliver stock certificates representing 291,600 shares of Series A
Preferred Stock to the EL Trustee and 68,398 shares of Series A
Preferred Stock to the LAL Trustees, (ii) execute and deliver to the EL
Trustee and the LAL Trustees a copy of the Fourth Amendment, manually
signed by an appropriate officer of the Company and (iii) pay to each of
LWG Partners and RAJ Partners, $1,000 by wire transfer to an account
designated in writing to the Company 48 hours prior to the Closing Date.
(c) The 1994 Trust, the LAL Trust, LWG Partners and RAJ
Partners as holders of all the outstanding $6.50 Preferred Stock hereby
each consent to, and waive all rights with respect to, the authorization
by the Board of Directors of the Company of the shares of Series A
Preferred Stock, the issuance of shares of Series A Preferred Stock
pursuant to the terms of this Agreement, the purchase of 20 shares of
$6.50 Preferred Stock by the Company and the transactions contemplated
by this Agreement for purposes of the Certificate of Incorporation,
including Section 4.4(e) thereof. On the Closing Date, each of the 1994
Trust, the LAL Trust, LWG Partners and RAJ Partners as holders of all
the outstanding $6.50 Preferred Stock hereby renounces and waives its
right to any dividends on the $6.50 Preferred Stock accrued or payable
from and after January 1, 2004.
2. Dividend Exchange.
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(a) Subject to and conditioned upon the consummation of the
share exchange as provided in Section 1 hereof, the 1994 Trust hereby
renounces and waives its right to receive on December 31, 2003, the
dividend in the aggregate amount of $4,738,500 on the $6.50 Preferred
Stock declared by the Board of Directors of the Company on November 5,
2003, in exchange for the right to receive on December 31, 2003 a
dividend on such shares in the aggregate amount of $3,462,750.
(b) Subject to and conditioned upon the consummation of the
share exchange as provided in Section 1 hereof, the LAL Trust hereby
renounces and waives its right to receive on December 31, 2003, the
dividend in the aggregate amount of $1,111,467.50 on the $6.50 Preferred
Stock declared by the Board of Directors of the Company on November 5,
2003, in exchange for the right to receive on December 31, 2003 a
dividend on such shares in the aggregate amount of $812,226.25.
(c) Subject to and conditioned upon the consummation of the
share purchase as provided in Section 1 hereof, LWG Partners hereby
renounces and waives its right to receive on December 31, 2003, the
dividend in the aggregate amount of $16.25 on the $6.50 Preferred Stock
declared by the Board of Directors of the Company on November 5, 2003,
in exchange for the right to receive on December 31, 2003 a dividend on
such shares in the aggregate amount of $11.88.
(d) Subject to and conditioned upon the consummation of the
share purchase as provided in Section 1 hereof, RAJ Partners hereby
renounces and waives its right to receive on December 31, 2003, the
dividend in the aggregate amount of $16.25 on the $6.50 Preferred Stock
declared by the Board of Directors of the Company on November 5, 2003,
in exchange for the right to receive on December 31, 2003 a dividend on
such shares in the aggregate amount of $11.88.
3. Further Assurances. The Company, the 1994 Trust, the LAL
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Trust, LWG Partners and RAJ Partners hereby agree to (i) execute, deliver and
file, if necessary, all documents and agreements necessary to implement Section
1 hereof and (ii) take all further action as may be reasonably necessary to
carry out the intent of this Agreement.
4. Representations and Warranties. Each of the 1994 Trust, the
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LAL Trust, LWG Partners and RAJ Partners, severally, and not jointly, hereby
represents and warrants to the Company as of the date hereof and on the Closing
Date as follows:
(a) It has all requisite power and authority to execute and
deliver this Agreement and to perform its obligations hereunder. The
execution, delivery and performance of this Agreement by it and the
consummation by it of the transactions contemplated hereby have been
duly authorized by all necessary action on its part. This Agreement has
been duly and validly executed and delivered by it and constitutes its
legal, valid and binding obligation, enforceable against it in
accordance with the terms of this Agreement, subject to applicable
bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium and similar laws affecting creditors' rights and remedies
generally and subject, as to enforceability, to general principles of
equity, including principles of commercial reasonableness, good faith
and fair dealing (regardless of whether enforcement is sought in a
proceeding at law or in equity).
(b) The execution and delivery of this Agreement, the
consummation of the transactions contemplated hereby and compliance by
it with any of the provisions hereof will not conflict with, constitute
a default under or violate (i) its governing documents (including its
trust agreement or partnership agreement, as applicable), (ii) any law
or regulation to which it may be subject or (iii) any judgment, writ,
injunction, decree, order or ruling of any court or governmental
authority binding on it.
(c) To its knowledge, as of the date hereof, no consent,
approval, waiver, license or authorization or other action by or filing
with any governmental authority is required in connection with the
execution and delivery by it of this Agreement or the consummation by it
of the transactions contemplated hereby; provided, however, that if any
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such consent, approval, waiver, license or authorization or other action
by or filing with any governmental authority becomes required, it shall
use its best efforts to satisfy such requirement.
(d) It is not insolvent.
(e) It is the sole legal and beneficial owner of the shares
of the $6.50 Preferred Stock set forth across its name on Schedule 1
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hereto; it owns no other shares of $6.50 Preferred Stock; and (i) there
is no agreement or understanding entered into which would restrict
transfer or voting of such shares, prevent the exchange or sale
contemplated hereby or restrict it from performing
its obligations hereunder and (ii) there are no liens, pledges, claims,
security interests, proxies, voting trusts or other encumbrances on such
shares, except, in the case of the preceding clauses (i) and (ii), with
respect to the shares of $6.50 Preferred Stock owned by the 1994 Trust,
the Pledge Agreement dated as of April 18, 2002, as amended, made by the
1994 Trust in favor of JPMorgan Chase Bank, all of the parties to which
have consented to the transactions contemplated hereby, and the liens
created pursuant thereto, provided that upon delivery to the Company on
the Closing Date of the stock certificates evidencing such shares, the
Company shall receive such shares free and clear of such liens, pledges,
claims, security interests, proxies, voting trusts or other encumbrances
on such shares and any other rights of any party under such Pledge
Agreement.
(f) Each of the 1994 Trust and the LAL Trust is acquiring
the Series A Preferred Stock solely for the purpose of investment and
not with a view to, or for offer or sale in connection with, any
distribution thereof; it is an accredited investor as such term is
defined in Rule 501 promulgated under the Securities Act of 1933, as
amended; and it acknowledges the shares of Series A Preferred Stock
shall be appropriately legended to reflect transfer restrictions
pursuant to applicable federal and state securities laws, including
blue-sky laws, and other applicable restrictions.
5. Representations and Warranties of the Company. The Company
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represents and warrants to the 1994 Trust, the LAL Trust, LWG Partners and RAJ
Partners as of the date hereof and on the Closing Date as follows:
(a) The Company is a corporation duly organized, validly
existing and in good standing under the laws of the state of Delaware
and has all requisite corporate power and corporate authority to own,
lease and operate its properties and to carry on its business as now
being conducted, except as would not have a material adverse effect on
the Company.
(b) The Company has all requisite corporate power and
authority to execute and deliver this Agreement and to perform its
obligations hereunder. The execution, delivery and performance of this
Agreement by the Company and the consummation by the Company of the
transactions contemplated hereby have been duly authorized by all
necessary corporate action on the part of the Company. This Agreement
has been duly and validly executed and delivered by the Company and
constitutes the legal, valid and binding obligation of the Company,
enforceable against the Company in accordance with its terms, subject to
applicable bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and similar laws affecting creditors'
rights and remedies generally and subject, as to enforceability, to
general principles of equity, including principles of commercial
reasonableness, good faith and fair dealing (regardless of whether
enforcement is sought in a proceeding at law or in equity).
(c) The execution and delivery of this Agreement, the
consummation of the transactions contemplated hereby and compliance by
the Company with any of the provisions hereof will not conflict with,
constitute a default under or violate (i) any law or regulation to which
it may be bound or (ii) any judgment, writ, injunction, decree, order or
ruling of any court or governmental authority binding on the Company.
(d) No consent, approval, waiver, license or authorization
or other action by or filing with any governmental authority is required
in connection with the execution and delivery by the Company of this
Agreement or the consummation by the Company of the transactions
contemplated hereby, except for the filing with and acceptance by the
Secretary of State of the State of Delaware of the Series A Designation.
(e) The Company is not a party to any agreement or
understanding that would prevent the exchange or sale contemplated
hereby or restrict it from performing its obligations hereunder.
(f) The Company represents and warrants only to the 1994
Trust and the LAL Trust on the Closing Date that the Series A Preferred
Stock has been duly authorized and, when issued as contemplated hereby,
will be validly issued, fully paid and nonassessable.
6. Miscellaneous.
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(a) Amendments and Waivers. This Agreement may be amended or
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modified at any time upon the agreement of the 1994 Trust, the LAL
Trust, LWG Partners and RAJ Partners and the Company by an instrument in
writing executed by each such party. In addition, any party may, at its
option, by an instrument in writing, waive or extend the time for the
fulfillment of any condition herein contained to be fulfilled for the
benefit of such party. Waiver by any party of any breach or failure to
comply with any provision of this Agreement by another party shall not
be construed as, or constitute, a continuing waiver of such provisions,
or a waiver of any other breach of or failure to comply with any other
provisions of this Agreement.
(b) Enforcement. Each party hereto hereby agrees that the
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remedy at law for any breach of this Agreement is inadequate and that
should any dispute arise concerning the terms hereof, this Agreement
shall be enforceable in a court of equity by an injunction or a decree
of specific performance. However, such remedies shall be cumulative and
nonexclusive, and shall be in addition to any other remedies that the
parties hereto may have.
(c) Expenses. All reasonable and documented out-of-pocket
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expenses of the Company (including the fees paid or payable to Xxxxx
& Company LLC ("Xxxxx") in accordance with the engagement letter between
the Company and Xxxxx, the fees paid or payable to Wachtell, Lipton,
Xxxxx & Xxxx, legal counsel to the special committee of the Board of
Directors, and the fees paid or payable to KPMG LLP for its review of
the transaction) associated with this Agreement and the transactions
contemplated hereby shall be borne eighty-one percent (81%) by the 1994
Trust and nineteen percent (19%) by the LAL Trust. The 1994 Trust and
the LAL Trust shall reimburse the Company for such expenses promptly
upon written request of the Company.
(d) Assignment; No Third-Party Beneficiaries. Neither this
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Agreement nor any of the rights, interests or obligations hereunder may
be assigned by any of the parties hereto, except, in the case of the
Company, by operation of law. Subject to the preceding sentence, this
Agreement will be binding upon, and will inure solely to the benefit of
and be enforceable by, the parties and the Company's successors and
assigns.
(e) Notices. Any notices and other communications given
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pursuant to this Agreement shall be in writing and shall be effective
upon delivery by hand or upon receipt if sent by certified or registered
mail (postage prepaid and return receipt requested) or by a nationally
recognized overnight courier service (appropriately marked for overnight
delivery) or upon transmission if sent by facsimile (with request for
immediate confirmation of receipt in a manner customary for
communications of such type and with physical delivery of the
communication being made by one of the other means specified in this
Section 6(e) as promptly as practicable thereafter). Notices are to be
addressed as follows:
(i) If to the Company:
The Xxxxx Xxxxxx Companies Inc.
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: General Counsel
Telecopy: (000) 000-0000
with a copy to:
Wachtell, Lipton, Xxxxx & Xxxx
00 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx X. Xxxxx, Esq.
Telecopy: (000) 000-0000
(ii) If to the 1994 Trust, then to the EL Trustee as
follows:
Xxxxxx Xxxxxxxxx
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telecopy: (000) 000-0000
with a copy to:
Debevoise & Xxxxxxxx
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx X. Xxxxx, Esq.
Telecopy: (000) 000-0000
(iii) If to the LAL Trust, then to each of the LAL
Trustees as follows:
Xxxxxxx X. Xxxxxx
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telecopy: (000) 000-0000
Xxxx X. Xxxxxxxxxx
c/x Xxxxxxxxxx & Ehrenkranz LLP
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telecopy: (000) 000-0000
with a copy to:
Weil, Gotshal & Xxxxxx LLP
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxx X. Xxxxxxxx, Esq.
Telecopy: (000) 000-0000
(iv) If to LWG Partners:
Xxxxxxx X. Xxxxxx
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telecopy: (000) 000-0000
with a copy to:
Weil, Gotshal & Xxxxxx LLP
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxx X. Xxxxxxxx, Esq.
Telecopy: (000) 000-0000
(v) If to RAJ Partners:
Xxxxxx X. Xxxxxx
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telecopy: (000) 000-0000
with a copy to:
Debevoise & Xxxxxxxx
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx X. Xxxxx, Esq.
Telecopy: (000) 000-0000
All such notices and communications shall be deemed to have been duly
given upon the occurrence of any of the following:(i) at the time
delivered by hand, if personally delivered; (ii) five business days
after being deposited in the mail, postage prepaid, if mailed; (iii)
when receipt acknowledged, if telecopied; and (iv) on the next business
day if timely delivered to a courier guaranteeing overnight delivery.
(f) Entire Agreement. This Agreement and the exhibits to this
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Agreement are intended by the parties as a final expression of their
agreement and 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. This Agreement supersedes all prior
agreements and understandings between the parties with respect to such
subject matter.
(g) Limitation on Representations and Warranties. Except as
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otherwise provided in Section 5, the Company does not make any, and
hereby expressly disclaims any, representation or warranty as to
itself, the shares of Series A Preferred Stock or the business of the
Company. Any warranty or other rights that may be implied by law or
otherwise in any jurisdiction in relation to the sale of shares of
Series A Preferred Stock in such jurisdiction is hereby excluded and,
if incapable of exclusion, each of the parties (other than the Company)
hereby waive such warranty or other rights and agree to bring no action
in connection therewith.
(h) Governing Law. This Agreement shall be governed by and
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construed in accordance with the internal laws of the State of New York
(other than its rules of conflicts of laws to the extent the
application of the laws of another jurisdiction would be required
thereby).
(i) Headings. The headings in this Agreement are for
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convenience of reference only and shall not limit or otherwise affect
the meaning of any of the terms or provisions hereof.
(j) Counterparts. This Agreement may be executed in any
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number of counterparts, each of which shall be deemed to be an
original, and all of which, when taken together, shall constitute one
and the same agreement.
(k) Severability. If any provision of this Agreement or the
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application thereof to any person or circumstances is determined by
a court of competent jurisdiction to be invalid, void or unenforceable,
the remaining provisions hereof, or the application of such provision
to persons or circumstances other than those as to which it has been
held invalid or unenforceable, shall remain in full force and effect
and shall in no way be affected, impaired or invalidated thereby, so
long as the economic or legal substance of the transactions
contemplated hereby is not affected in any manner adverse to any party.
Upon such determination, the parties shall negotiate in good faith in
an effort to agree upon a suitable and equitable substitute provision
to effect the original intent of the parties.
[Remainder of page intentionally left blank]
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year first above written.
THE XXXXX XXXXXX COMPANIES INC.
By: /s/ Xxxx X. Xxxxxxxxxx
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Name: Xxxx X. Xxxxxxxxxx
Title: President and CEO
/s/ Xxxxxxx X. Xxxxxx
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Xxxxxxx X. Xxxxxx, as Trustee of The
LAL 1995 Preferred Stock Trust
/s/ Xxxx X. Xxxxxxxxxx
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Xxxx X. Xxxxxxxxxx, as Trustee of The
LAL 1995 Preferred Stock Trust
/s/ Xxxxxx Xxxxxxxxx
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Xxxxxx Xxxxxxxxx, as Trustee of The
Xxxxx Xxxxxx 1994 Trust
LWG Family Partners L.P.
By LWG Family Corporation, a general
partner
By: /s/ Xxxxxxx X. Xxxxxx
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Xxxxxxx X. Xxxxxx
President
RAJ Family Partners L.P.
By RAJ Family Corporation, a general
partner
By: /s/ Xxxxxx X. Xxxxxx
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Xxxxxx X. Xxxxxx
President
Schedule 1
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Stockholder Number of Shares of $6.50 Preferred Stock
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1994 Trust 2,916,000
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LAL Trust 683,980
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LWG Partners 10
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RAJ Partners 10
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