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EXHIBIT 2.3
AMENDMENT NO. 2
DATED AS OF SEPTEMBER 30, 1998
TO
REORGANIZATION,
RECAPITALIZATION AND STOCK PURCHASE AGREEMENT
DATED AS OF JUNE 29, 1998
BY AND BETWEEN
THE BLACK & XXXXXX CORPORATION,
TRUE TEMPER CORPORATION
(FORMERLY TRUE TEMPER SPORTS, INC.)
AND
TRUE TEMPER SPORTS, LLC
(FORMERLY TTSI LLC)
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AMENDMENT NO. 2 TO
REORGANIZATION, RECAPITALIZATION AND
STOCK PURCHASE AGREEMENT
This Amendment No. 2 (this "Amendment") to Reorganization,
Recapitalization and Stock Purchase Agreement (together with the Exhibits,
Schedules and Attachments thereto, as amended by Amendment No. 1 thereto dated
as of August 1, 1998, the "Agreement") is made as of the ____ day of September
1998, by and among The Black & Xxxxxx Corporation, a Maryland corporation
("Parent"), True Temper Corporation, a Delaware corporation ("TTSI", formerly
known as True Temper Sports, Inc.), and True Temper Sports, LLC, a Delaware
limited liability company ("Buyer", formerly known as TTSI LLC).
W I T N E S E T H:
WHEREAS, Parent, TTSI and Buyer entered into the Reorganization,
Recapitalization and Stock Purchase Agreement as of June 29, 1998, and Amendment
No. 1 thereto as of August 1, 1998; and
WHEREAS, Parent, TTSI and Buyer desire to amend and clarify certain terms
contained in the Agreement, all as more fully set forth herein;
NOW, THEREFORE, in consideration of the mutual covenants and agreements of the
parties contained herein, the parties agree as follows:
Section 1. Definitions. Capitalized terms used in but not defined in this
Amendment shall have the meanings specified in the Agreement.
Section 2. Amendment to Section 2.01.
(a) Section 2.01(c) is amended by deleting the number "368.75" and
inserting in lieu thereof "3,687,500".
(b) Section 2.01(e) is amended by deleting Section 2.01(e) in its
entirety and inserting in its place and stead the following:
(e) In exchange for the transfer of the Transferred Intellectual
Property contemplated by Section 2.01(d), TTSI will issue to
Emhart 4,709.82 shares of TTSI Common Stock, 8,812,500 shares
of TTSI Preferred Stock, which shares of TTSI Common Stock and
TTSI Preferred Stock shall upon such issuance be duly
authorized, fully paid and non-assessable shares of capital
Stock of TTSI, and $25,000,000 aggregate initial principal
amount of senior increasing rate notes of TTSI pursuant to a
Securities Purchase Agreement in the form attached hereto as
Exhibit A, which senior
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increasing rate notes shall include warrants to purchase
shares of TTSI Common Stock under certain circumstances;
Section 3. Amendment to Section 2.03.
(a) Section 2.03(a)(i) is amended by deleting the number "5,818.60" and
inserting in lieu thereof "4,528.42", and is further amended by deleting the
amount "$112,747,535.88" and inserting in lieu thereof "$87,747,535.88".
(b) Section 2.03(b)(i) is amended by deleting the number "293.75" and
inserting in lieu thereof "2,937,500", and is further amended by deleting the
number "881.25" and inserting in lieu thereof "8,812,500".
(c) The last unnumbered clause of Section 2.03(b) is amended by
deleting the number "75" and inserting in lieu thereof "750,000", and is further
amended by deleting the number "1175" and inserting in lieu thereof
"11,175,000".
Section 4. Stock Split. At the request of the Buyer, TTSI has effected a 10,000
to 1 split of the TTSI Common Stock by means of a stock dividend (the "Stock
Split") immediately upon the completion of the redemption described in Section
2.03(a) of the Agreement. The parties agree that the numbers of shares of TTSI
Common Stock set forth in the Agreement are before giving effect to the Stock
Split and, with respect to all transactions occurring after the Stock Split, all
such numbers of shares of TTSI Common Stock shall be adjusted to reflect the
Stock Split
Section 5. Amendment to Section D.07(d). Section D.07(d) is hereby amended by
deleting the phrase "an interest rate of 5.75%" at the end of the second
sentence and inserting in its place and stead "the actuarial assumptions used by
the PBGC pursuant to Section 1.414(l)-1(b)(5)(ii) of the U.S. Department of
Labor Regulations, provided that to the extent that the total of the Transfer
Amount under this Section D.07(d) plus the Transfer Amount under Section D.08(d)
is more than $40,000 less than the amount of the total of such Transfer Amounts
had they been determined using an interest rate of 5.75%, an amount equal to
such deficit in excess of $40,000 shall be added to the Transfer Amount under
this Section D.07(d)".
Section 6. Amendment to Section D.08(d). Section D.08(d) is hereby amended by
deleting the phrase "an interest rate of 5.75%" at the end of the second
sentence and inserting in its place and stead "the actuarial assumptions used by
the PBGC pursuant to Section 1.414(l)-1(b)(5)(ii) of the U.S. Department of
Labor Regulations".
Section 7. Amendment to Article III of Exhibit D. Article III of the Exhibit D
of the Agreement is amended by deleting Sections D.13 and D.14 and substituting
therefore the following:
D.13. Parent agrees, subject to Applicable Law, to cause its
appropriate Affiliate to continue to employ the Non U.S. Transferred Employees
for a temporary period (the "Transition Period") ending on the earlier of (i)
the date Buyer or TTSI elects to employ the Non U.S.
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Transferred Employees, or (ii) the close of business on September 30, 1999.
Although the Non U.S. Transferred Employees will remain employed by Parent or
its Affiliate during the Transition Period, such persons will be working on the
business of the Buyer or TTSI, and will report to and be subject to the control
and supervision of Buyer and TTSI. Parent agrees that neither Parent nor any of
its Affiliates will, without a consent of Buyer or TTSI (which consent will not
be unreasonably withheld) alter any terms and conditions of or terminate the
employment of any Non U.S. Transferred Employee during the Transition Period.
Buyer and/or TTSI shall reimburse Parent or its designated Affiliate within
seven days of receipt of an invoice for any fees, costs, taxes or expenses
reasonably and properly incurred by Parent or its Affiliate, as a result of
employing and of providing and administering benefits to the Non U.S.
Transferred Employees and their dependents and beneficiaries during the
Transition Period.
D. 14. Notwithstanding any contrary provision of the Transaction
Documents, effective upon the close of the Transition Period, the employment of
all Non U.S. Transferred Employees shall be transferred to Buyer or TTSI such
that the employment of such person shall be considered continuous employment
under Applicable Law. Buyer and TTSI shall ensure that such employment shall be
on the same terms and conditions as those under which such persons are employed
immediately prior to the close of the Transition Period. Buyer and TTSI shall
assume any obligations under any agreement or Applicable Law relating to the
terms and conditions of employment of any Non U.S. Transferred Employees, and
Buyer and TTSI shall be responsible for any liability or obligations arising out
of or pertaining to the termination employment of, hiring of or failure or
refusal to hire any Non U.S. Transferred Employees on or after the close of the
Transition Period. In addition to the indemnification provisions otherwise
provided in the Transaction Documents, Buyer and TTSI agree to indemnify Parent
and its Affiliates and their respective directors, officers, employees and
agents against, and agree to hold them harmless from, any and all Damages
arising out of or pertaining to the employment of the Non U.S. Transferred
Employees during the Transition Period or by Buyer or TTSI thereafter, any
actions or omission taken or made by any Non U.S. Transferred Employee during
the Transition Period and thereafter, and the termination of employment of,
hiring of or failure to or refusal to hire, any Non U. S. Transferred Employee
on or after the close of the Transition Period.
Section 8. Limited Amendment. Except as amended by this Amendment and as the
context may otherwise require to give effect to the intent and purposes of this
Amendment, the Agreement shall remain in full force and effect without any other
amendments or modifications.
Section 9. Notices. All notices, requests and other communications to any party
hereunder shall be in writing (including telecopy or similar writing) and shall
be given,
if to Parent (or TTSI prior to Closing):
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c/o The Black & Xxxxxx Corporation
000 Xxxx Xxxxx Xxxx
Xxxxxx, Xxxxxxxx 00000
Attention: Senior Vice President and
Chief Financial Officer
Telecopy: (000) 000-0000
with a copy to:
The Black & Xxxxxx Corporation
000 Xxxx Xxxxx Xxxx
Xxxxxx, Xxxxxxxx 00000
Attention: Senior Vice President and
General Counsel
Telecopy: (000) 000-0000
and
Miles & Stockbridge P.C.
00 Xxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxx 00000
Attention: Xxxxx X. Xxxxxxxx
Xxxxx X. Xxxxxxx
Telecopy: (000) 000-0000
if to Buyer (or TTSI after Closing):
TTSI LLC
c/o Cornerstone Equity Investors, LLC
000 0xx Xxxxxx
Xxxxx 0000
Xxx Xxxx, Xxx Xxxx 00000
Attention: Mr. Xxxx Xxxxx
Telecopy: (000) 000-0000
with a copy to:
Xxxxxxxx & Xxxxx
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxxxx Xxxxx, Esquire
Telecopy: (000) 000-0000
or to such other address or telecopy number and with such other copies, as such
party may hereafter
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specify by notice to the other parties. Each such notice, request or other
communication shall be effective (i) if given by telecopy, when such telecopy is
transmitted to the telecopy number specified in this Section 7 and evidence of
receipt is received or (ii) if given by any other means, upon delivery or
refusal of delivery at the address specified in this Section 7.
Section 10. Amendments; Waivers. Subject to the provisions of Section 9.04 of
the Agreement, any provision of this Amendment may be amended or waived prior to
the Closing Date if, and only if, such amendment or waiver is in writing and
signed, in the case of an amendment, by Parent and Buyer, or in the case of a
waiver, by the party against whom the waiver is to be effective.
Section 11. Successors and Assigns. The provisions of this Amendment shall be
binding upon and inure to the benefit of the parties and their respective
successors and assigns; provided that no party may assign, delegate or otherwise
transfer any of its rights or obligations under this Agreement without the
consent of the other party, provided the Buyer may assign its or TTSI's rights
hereunder to an agent for the financing sources in connection with the
Contemplated Transactions, as collateral security for TTSI's obligations, and
Buyer may assign its rights to purchase Acquired Shares to Permitted Assignees.
Section 12. Entire Agreement. The Transaction Documents and any other agreements
contemplated thereby (including, to the extent contemplated herein, the
Confidentiality Agreement) as amended by this Amendment constitute the entire
agreement among the parties with respect to the subject matter of such documents
and supersede all prior agreements, understandings and negotiations, both
written and oral, between the parties with respect to the subject matter
thereof.
Section 13. Jurisdiction. Any suit, action or proceeding seeking to enforce any
provision of, or based on any matter arising out of or in connection with, this
Amendment or the Contemplated Transactions shall be brought in the United States
District Court for the District of Delaware (or, if subject matter jurisdiction
is unavailable, any of the state courts of the State of Delaware), and each of
the parties hereby consents to the exclusive jurisdiction of such court (and of
the appropriate appellate court) in any such suit, action or proceeding and
waives any objection to venue laid therein. Process in any such suit, action or
proceeding may be served on any party anywhere in the world, whether within or
without the State of Delaware. Without limiting the foregoing, Parent, TTSI and
Buyer agree that service of process upon such party at the address referred to
in Section 4 together with written notice of such service to such party, shall
be deemed effective service of process upon such party.
Section 14. Severability. Any provision of this Amendment that 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 of the this Amendment or affecting the validity or
enforceability of such provision in any other jurisdiction. To the extent any
provision of this Amendment is determined to be prohibited or unenforceable in
any jurisdiction Parent and Buyer agree to use reasonable commercial efforts,
and agree to cause the other Seller Companies and TTSI, as the case may be, to
use reasonable commercial efforts, to substitute one or more valid, legal and
enforceable provisions that, insofar as practicable implement the purposes and
intent of the
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prohibited or unenforceable provision.
Section 15. Captions. The captions herein are included for convenience of
reference only and shall be ignored in the construction or interpretation
hereof.
IN WITNESS WHEREOF, the parties hereto caused this Amendment to be duly executed
by their respective authorized officers on the day and year first above written.
THE BLACK & XXXXXX CORPORATION
By:__________________________________
Name: Xxxxxxx X. Xxxxxx
Title: Senior Vice President and General
Counsel
TRUE TEMPER CORPORATION
By:__________________________________
Name: Xxxxxxx X. Xxxxxx
Title: Vice President
TRUE TEMPER SPORTS, LLC
By:__________________________________
Name: Xxxxx X. Xxxxxxx
Title: Managing Director
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