Exhibit 99.1
FIRST AMENDMENT TO
ASSET PURCHASE AGREEMENT
AND
TERMINATION OF OPERATIONS AGREEMENT
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THIS FIRST AMENDMENT TO ASSET PURCHASE AGREEMENT AND TERMINATION OF
OPERATIONS AGREEMENT (this "Amendment and Termination") is made as of June 25,
1998, by and among Market Growth Resources, Inc.(formerly MGR Holdings Co.), a
Delaware corporation ("Buyer") True North Communications Inc., a Delaware
corporation ("True North"), 10-20 Corporation. ("Seller") and Xxxx X. Block, W.
Xxxxxx Xxxx, Xxxxxxx X. Xxxxxxx and Xxxxxxx X. Xxxxxx (individually a
"Stockholder" and collectively, the "Stockholders").
WHEREAS, Buyer, True North, Seller and the Stockholders are parties to an
Asset Purchase Agreement, dated as of November 16, 1995 (the "Asset Purchase
Agreement");
WHEREAS, pursuant to Section 13.7 of the Asset Purchase Agreement, the
parties desire to amend certain provisions thereof;
WHEREAS, Buyer, Seller and the Stockholders are parties to an Operations
Agreement, dated as of November 16, 1995 (the "Operations Agreement");
AND WHEREAS, the parties desire to terminate the Operations Agreement.
NOW, THEREFORE, in consideration of the mutual covenants and agreements
hereinafter set forth, the parties hereto covenant and agree as follows:
1. Amendments to Asset Purchase Agreement.
(a) Section 4.6(c) of the Asset Purchase Agreement is hereby deleted
in its entirety and the following inserted in place thereof:
"(c) In addition to Buyer's obligations under Section 4.6(a)
above, Buyer shall pay or (in the case of subsection (ii), issue and
deliver) to Seller (i) on July 1, 1998, $6,597,000 in cash, (ii) on
July 1, 1998, 111,438 shares of common stock, $.33-1/3 par value, of
True North (the "Shares") in the name of Seller and (iii) on July 1,
1999, $3,298,000 in cash plus interest thereon (calculated from July
1, 1998 until the date of payment) at a rate of 8% per annum,
compounded quarterly."
(b) Section 4.6(f) of the Asset Purchase Agreement is hereby deleted
in its entirety.
(c) Section 13.4 of the Asset Purchase Agreement is hereby deleted in
its entirety and the following inserted in place thereof:
"13.4. Notices. All notices or other communications required or
permitted hereunder shall be in writing and shall be deemed given or
delivered and received when delivered personally (which shall be
deemed to include delivery via express courier such as Fed Ex) or
three days after having been sent by registered or certified mail
addressed as follows:
If to Buyer, to:
Market Growth Resources, Inc.
00 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Valentine X. Xxxxxx
Facsimile: (000) 000-0000
with a copy to:
True North Communications Inc.
000 Xxxx Xxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Assistant General Counsel
Facsimile: (000) 000-0000
If to True North, to the address and person set forth above.
If to Seller, to:
10-20 Corporation
c/o Xxxxxx Xxxxxxx
00 Xxxx Xxxxxxxx
Xxxxxxxxxx, XX 00000
Facsimile: (000) 000-0000
with a copy to:
Xxxxxxx, Xxxxxx & Green
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxx Xxxxxxxxxx
Facsimile: (000) 000-0000
If to any Stockholder, to:
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Xxxxxxx X. Xxxxxxx
00 Xxxx Xxxxxxxx
Xxxxxxxxxx, XX 00000
Facsimile: (000) 000-0000
Xxxxxxx X. Xxxxxx
000 Xxxx Xxxxxxxx Xxxxx
Xxx Xxxxxx, XX 00000
Xxxx X. Block
0 Xxxxxxx Xxxx
Xxxxxx, XX 00000
W. Xxxxxx Xxxx
000 Xxxxxx Xxxx
Xxxxxx, XX 00000
Facsimile: (000) 000-0000
With a copy in each case to Xxxxxxx Xxxxxx & Green as
aforesaid.
or to such other address as such party (or its designated
additional notice recipient) may indicate by a notice delivered
to the other party hereto."
2. Payment Pursuant to Section 4.6(c) of the Asset Purchase Agreement. On
the date hereof, (i) Buyer shall deliver to Seller the payment required to be
paid pursuant to Section 4.6(c)(i) of the Asset Purchase Agreement, as amended
hereby, by wire transfer of immediately available funds to the account of 10-20
Corporation, Chase Manhattan Bank, Xxxxxx Xxxxxx, 00 Xxx Xxxxxxxxxx Xxxx,
Xxxxxx, Xxxxxxxxxxx 00000, ABA #021 000 021, Account: 10-20 Corporation, Account
#000-000-0000, Contact: Xxxxxx XxXxxxxx (000) 000-0000 and (ii) True North
shall issue and deliver to Seller the shares required to be delivered pursuant
to Section 4.6(c)(ii) of the Asset Purchase Agreement, as amended hereby.
Unless otherwise instructed by Seller, Buyer will also wire the sum to be paid
pursuant to Section 4.6(c)(iii) to the same account.
3. Restriction on Transfer of Shares; Registration of Shares. In addition
to any restrictions imposed upon Seller and its transferees by any securities
laws or regulations, Seller hereby agrees that it will not sell, assign, pledge,
transfer or otherwise convey any of the shares issued pursuant to Section
4.6(c)(ii) of the Asset Purchase Agreement, as amended hereby, prior to January
1, 1999. Following the date hereof, True North agrees to use its best efforts
to accomplish the following prior to January 1, 1999: (a) cause the resale of
such Shares to be registered under the Securities Act of 1933, as amended (until
the earlier of July 1, 1999 and the date on
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which all of the Shares have been sold thereunder) and listed on the New York
Stock Exchange for trading and (b) in connection with the foregoing, provide to
Seller any items (including a prospectus), and do and perform such other acts
and things, as may be required to allow Seller to trade the Shares on the New
York Stock Exchange. In the event that, on or before January 1, 1999, True North
shall not have succeeded in accomplishing the matters set forth in (a) and (b)
above (and notified Seller thereof), (i) Buyer shall pay to Seller (by wire
transfer of immediately available funds to the account set forth in Section 2,
unless otherwise instructed by Seller), on or before January 5, 1999, $3,298,000
plus interest thereon at a rate of 8% per annum, compounded quarterly, from the
date hereof up to and including the date of payment and (ii) Seller shall
surrender the Shares, free and clear of any liens, pledges or other
encumbrances, to Buyer.
4. Ratification. Each party ratifies and confirms its obligations under
the Asset Purchase Agreement as amended hereby and the effectiveness of the
Asset Purchase Agreement as amended hereby.
5. Reference in Other Documents. References to the Asset Purchase
Agreement in any other document shall be deemed to include a reference to the
Asset Purchase Agreement, as amended by this Amendment and Termination, whether
or not reference is made to this Amendment and Termination.
6. Termination of Operations Agreement. The Operations Agreement is hereby
terminated in its entirety and shall be of no further force or effect. The
parties thereto hereby waive any claims they may have now or in the future under
the Operations Agreement, whether currently known or unknown. As of the date
hereof and thereafter, all employees of Buyer (other than the Stockholders whose
bonus arrangements are addressed in their employment agreements) may, at the
option of True North, be eligible to receive benefits under the True North
Incentive Compensation Plan.
7. Severability. Any provision of this Amendment and Termination which is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof or affecting the validity or
enforceability of such provision in any other jurisdiction.
8. Headings. The headings of subdivisions in this Amendment and
Termination are for convenience of reference only, and shall not govern the
interpretation of any of the provisions of this Amendment and Termination.
9. Governing Law. This Amendment and Termination shall be deemed to be a
contract made under the laws of the State of Illinois and for all purposes shall
be construed in accordance with the laws of said state, without regard to
principles of conflicts of law.
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10. Counterparts. This Amendment and Termination may be executed upon any
number of counterparts, each of which counterparts, when so executed and
delivered, shall be deemed to be an original and all of which counterparts, when
together, shall constitute one and the same agreement.
11. Entire Agreement. This Amendment and Termination contains the entire
understanding of the parties with respect to the subject matter contained herein
and supersedes all prior arrangements or understandings with respect thereto.
12. Effectiveness. Notwithstanding anything to the contrary contained
herein, this Amendment and Termination shall not be effective unless and until
the payment and shares required to be paid and delivered on July 1, 1998 shall
have been delivered in accordance with Sections 1(a) and 2(a) hereof.
* * * * *
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment and
Termination to be executed the day and year first written above.
Market Growth Resources, Inc.
By:
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Name:
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Title:
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True North Communications Inc.
By:
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Name:
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Title:
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10-20 Corporation
By:
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Name:
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Title:
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Xxxx X. Block
---------------------------------
W. Xxxxxx Xxxx
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Xxxxxxx X. Xxxxxxx
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Xxxxxxx X. Xxxxxx
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