EXHIBIT 10.1
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AMENDMENT NO. 1 TO THE STOCKHOLDER AGREEMENT
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This Amendment No. 1, dated as of April 16, 1998 ("Amendment No. 1"),
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to the Stockholder Agreement dated as of February 3, 1998 (the "Stockholder
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Agreement"), is entered into by and among Warburg, Xxxxxx Investors, L.P., a
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Delaware limited partnership ("Stockholder"), Primus Telecommunications Group,
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Incorporated, a Delaware corporation ("Purchaser"), Taurus Acquisition
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Corporation, a Florida corporation and a wholly-owned subsidiary of Purchaser
("Purchaser Subsidiary"), K. Xxxx Xxxxx, a resident of the Commonwealth of
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Virginia (the "Executive"), and, as to Section 2A.6 hereof only, TresCom
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International, Inc., a Florida corporation (the "Target"). The Stockholder,
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Purchaser, Purchaser Subsidiary and Executive are referred to collectively
herein as the "Parties". Capitalized terms not otherwise defined herein have
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the meanings set forth in the Stockholder Agreement.
WITNESSETH:
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WHEREAS, the Parties previously entered into the Stockholder Agreement
and, together with the Target (as to Section 2A.6 hereof only) now desire to
amend the Stockholder Agreement as set forth below;
WHEREAS, concurrently with this Amendment No. 1, and as a condition
hereto, Purchaser, Purchaser Subsidiary and Target are entering into an
amendment to the Agreement and Plan of Merger dated as of February 3, 1998 (as
so amended, as previously amended and as hereafter amended, the "Merger
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Agreement");
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NOW, THEREFORE, in consideration of the premises and the mutual
covenants and agreements contained herein, and for other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged, the
Parties and the Target (as to Section 2A.6 hereof only) agree as follows:
1. Section 1.1 of the Stockholder Agreement is hereby amended by deleting
the words ", except as expressly set forth below," and the proviso appearing in
the last sentence thereof.
2. Section 2.1 of the Stockholder Agreement is hereby amended (i) by
deleting the words "fifty percent (50%)" and inserting in its place the words
"one hundred percent (100%)" and (ii) by deleting the words "$10 per Share" and
inserting in its place the words "$12 per Share".
3. A new Section 2A is hereby added to the Stockholder Agreement which
shall read in its entirety as follows:
"2A. Option
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2A.1. Stockholder hereby grants to the Purchaser an irrevocable option,
exercisable as provided herein (the "Option"), to purchase all of the Shares
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(the "Option Shares") at an exercise price determined as set forth below. The
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exercise price per Share shall be payable in shares of Purchaser Common Stock
(as defined
in Section 8.5 below) and shall equal the Per Share Merger Consideration (as
defined in the Merger Agreement), it being understood that for purposes of
determining the Per Share Merger Consideration in connection with this
Agreement, the Weighted Average Sales Price of a Purchaser Share shall be
determined with reference to the applicable exercise date of the Option as
opposed to the Closing Date (as defined in the Merger Agreement).
2A.2. The Option may be exercised by the Purchaser at any time after
the Merger Agreement is terminated under circumstances which entitle the
Purchaser to receive the amount provided for under Section 7(b)(ii) of the
Merger Agreement until the 30th day following the termination of the Merger
Agreement. If the Purchaser wishes to exercise the Option, the Purchaser shall
give written notice to the Stockholder of its exercise of the Option, specifying
the place, time and date (not earlier than three business days and not later
than 20 days from the date such notice is given) for the closing of such
purchase (the "Closing"). If the Option is exercised, Stockholder agrees to
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exercise the Warrant in full no later than immediately prior to the Closing, it
being understood that all such Shares obtained by Stockholder upon the exercise
of the Warrant shall be subject to the Option and purchased by the Purchaser at
the Closing. The exercise of the Option shall be effective on the date such
notice of exercise is given. The Closing shall be held on the date specified in
such notice unless, on such date, there shall be any preliminary or permanent
injunction or other order by any court of competent jurisdiction or any other
legal restraint or prohibition preventing the consummation of such purchase, in
which event the Closing shall be held as soon as practicable following the
lifting, termination or suspension of such injunction, order, restraint or
prohibition (each party agreeing to use its best efforts to have such
injunction, order, restraint or prohibition lifted, terminated or suspended),
but in any event within two days thereof. Stockholder's obligations to sell
Option Shares upon exercise of the Option are subject to the condition that
there shall be no preliminary or permanent injunction or other order preventing
or restricting the issuance of the Option Shares to the Purchaser or the
issuance of Purchaser Common Stock to Stockholder.
2A.3 Delivery of Exercise Price and Option Shares. At any Closing
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hereunder (a) the Purchaser shall make payment to the Stockholder of the
aggregate Exercise Price for the Option Shares so purchased by delivery of a
certificate or certificates, duly executed by the Purchaser and registered in
the name of Stockholder, representing the number of shares of Purchaser Common
Stock as determined pursuant to this Section 2A, and (b) the Stockholder shall
deliver or cause to be delivered to the Purchaser a certificate or certificates,
duly executed by the Target and registered in the name of the Purchaser,
representing the number of Option Shares so purchased.
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2A.4 Offer to Other Stockholders. Promptly after the Closing
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hereunder, but in no event later than five (5) business days after the Closing
hereunder, Purchaser agrees to take all actions necessary or appropriate in
order to commence a tender offer (an "Offer") under the Exchange Act and the
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rules and regulations thereunder for any and all outstanding shares of Common
Stock not owned by the Purchaser, and shall use reasonable efforts to promptly
complete the Offer. The amount and the form of the purchase price per share of
Common Stock to be paid in any such Offer shall be the same as is paid per Share
to Stockholder upon exercise of the Option.
2A.5 Stockholder's Investment Representation. In connection with any
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exercise of the Option and the issuance of shares of Purchaser Common Stock to
Stockholder pursuant thereto, Stockholder represents and warrants to the
Purchaser that it is an institutional "accredited investor" within the meaning
of subparagraph (a)(1), (2), (3), or (7) of Rule 501 under the Securities Act
(an "Institutional Accredited Investor") or, if the shares of Purchaser Common
Stock are to be issued to one or more accounts ("investor accounts") for which
it is acting as fiduciary or agent, each such account is an Institutional
Accredited Investor. In the normal course of its business, it invests in or
purchases securities similar to the shares of Purchaser Common Stock and it has
such knowledge and experience in financial and business matters that it is
capable of evaluating the merits and risks of purchasing the Purchaser Common
Stock. It is acquiring the shares of Purchaser Common Stock for its own
account, or for one or more investor accounts for which it is acting as a
fiduciary or agent, in each case for investment, and not with a view to, or for
offer or sale in connection with, any distribution thereof in violation of the
Securities Act, subject to any requirement of law that the disposition of its
property or the property of such investor account or accounts be at all times
within its or their control and subject to its or their ability to resell any
such shares of Purchaser Common Stock pursuant to any exemption from
registration available under the Securities Act or pursuant to the registration
rights granted below in this Agreement. It understands and acknowledges that
the shares of Purchaser Common Stock will not have been registered under the
Securities Act or any other applicable securities laws and, unless so
registered, may not be offered, sold or otherwise transferred except in
compliance with the registration requirements of the Securities Act and any
other applicable securities laws, or pursuant to an exemption therefrom or in a
transaction not subject thereto. It is aware that it (or any investor account)
may be required to bear the economic risk of an investment in the shares of
Purchaser Common Stock for an indefinite period of time and it (or such account)
is able to bear that risk for an indefinite period. It agrees that the shares
of Purchaser Common Stock will bear a legend in substantially the following
form:
THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OR ANY OTHER APPLICABLE
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SECURITIES LAWS AND, UNLESS SO REGISTERED, MAY NOT BE OFFERED, SOLD
OR OTHERWISE TRANSFERRED EXCEPT IN COMPLIANCE WITH THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT AND ANY OTHER APPLICABLE
SECURITIES LAWS, OR PURSUANT TO AN EXEMPTION THEREFROM OR IN A
TRANSACTION NOT SUBJECT THERETO.
2A.6 Purchaser Board Representation. Concurrently with the Closing,
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Stockholder agrees to use its reasonable best efforts to cause Messrs. Xxxxxxx
Xxxx, Xxxxx Xxxxxxx and Xxxx Xxxxxxx (the "Existing Stockholder Designees"), or
any person who succeeds any of the Existing Stockholder Designees as a member of
the Target's board of directors and who is designated by Stockholder, other than
those persons designated by the Purchaser as provided below (the "Stockholder
Designees"), to resign immediately from the Target's board of directors.
Subject to applicable law and the charter and by-laws of the Target, immediately
after such resignation of the Stockholder Designees, the Target agrees to use
its reasonable best efforts (a) to take such actions as are necessary or
appropriate to increase the number of persons to serve as directors of the
Target and (b) to cause to be appointed to its board of directors such number of
designees of the Purchaser (all of whom are reasonably acceptable to the Target
board of directors) so that, after giving effect to such increase and
appointment, the designees of Purchaser so appointed shall constitute a majority
of the members of the Target's board of directors. The Target hereby agrees
that if any of the Existing Stockholder Designees resigns, is removed or is
otherwise no longer serving as a member of the Target's board of directors, in
each case prior to the Closing, it will use its reasonable best efforts to cause
any such vacancy in the Target's board of directors to be filled by an
individual who is an employee or affiliate of the Stockholder."
4. Section 5 of the Stockholder Agreement is hereby amended and
restated to read in its entirety as follows:
"5. Termination. This Agreement shall terminate on the earliest of (a)
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the Effective Time (as defined in the Merger Agreement), (b) the date
immediately following the termination of the Merger Agreement in accordance with
its terms, and (c) October 31, 1998; provided, however, (i) the provisions of
Section 1.1 shall survive any termination of this Agreement for so long as the
Option remains exercisable, (ii) the provisions of Sections 2, 2A, 5 and 6 shall
survive any termination of this Agreement, and (iii) the provisions of Sections
8.3, 8.4, 8.5, 8.7 and 9 shall survive (x) the Effective Time if this Agreement
otherwise terminates at the Effective Time or (y) if the Option is exercisable
or exercised under Section 2A and this Agreement otherwise terminates."
5. The definition of "Registrable Securities" set forth in Section 9.1 of
the Stockholder Agreement is amended and restated to read in its entirety as
follows:
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"'Registrable Securities' means all the Purchaser Shares received by
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the Stockholder at the Effective Time or pursuant to any exercise of the Option,
together with any additional Purchaser Shares received by the Stockholder as a
result of any stock dividend, extraordinary dividend or distribution, split-up,
recapitalization, combination, exchange of shares or the like and involving the
Purchaser Shares received by the Stockholder at the Effective Time or pursuant
to any exercise of the Option; provided, however, such securities shall cease to
be Registrable Securities when they become freely saleable to the public under
Rule 145(d) and Rule 144, without volume limitation, as the case may be."
6. Clause (iii) of Section 9.3(d) of the Stockholder Agreement is
amended and restated to read in its entirety as follows:
"third, to the extent additional Purchaser Shares may be included, the
Registrable Securities sought to be sold by Stockholder and any Purchaser Shares
sought to be sold by Messrs. Xxxxxx X'Xxxxx or Xxxxxxx XxXxxxxxx pursuant to the
voting agreements, each dated as of February 3, 1998, as amended on April 16,
1998, pro rata among Stockholder and Messrs. O'Brien and XxXxxxxxx based upon
the number of Purchaser Shares so sought to be sold by each of them"
7. The Purchaser's address for notices and other communications under
Section 11 of the Stockholder Agreement is hereby amended as follows:
"If to Purchaser:
Primus Telecommunications Group, Incorporated
0000 Xxx Xxxxxx Xxxx
XxXxxx, XX 00000
Attention: K. Xxxx Xxxxx, Chairman, President and CEO
Facsimile: (000) 000-0000"
8. In the case of any inconsistency or conflict between the provisions
of this Amendment No. 1 and the provisions of the Stockholder Agreement, the
provisions of this Amendment No. 1 shall govern.
9. Except as expressly provided for in this Amendment No. 1, all terms,
conditions and obligations contained in the Stockholder Agreement are hereby
confirmed and shall remain unchanged and in full force and effect.
10. This Amendment No. 1 may be executed by facsimile signature which
shall be deemed to be an original for all purposes and may be executed in any
number of counterparts,
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each of which shall be deemed to be an original and all of which, when taken
together, shall constitute but one and the same instrument.
11. THIS AMENDMENT NO. 1 SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF FLORIDA, WITHOUT REGARD TO SUCH STATE'S CONFLICTS
OF LAWS RULES.
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IN WITNESS WHEREOF, the Parties have executed this Amendment No. 1 as of
the date first above written.
Primus Telecommunications Group, Incorporated
By: /s/ K. Xxxx Xxxxx
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Name: K. Xxxx Xxxxx
Title: President, Chairman and Chief Executive
Officer
Taurus Acquisition Corporation
By: /s/ K. Xxxx Xxxxx
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Name: K. Xxxx Xxxxx
Title: President
Warburg, Pincus, Investors, L.P.
By: Warburg, Xxxxxx & Co., general partner
By: /s/ Xxxxxxx Xxxx
______________________________
Name:
Title:
/s/ K. Xxxx Xxxxx
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K. Xxxx Xxxxx
AS TO SECTION 2A.6 ONLY:
TresCom International, Inc.
By: /s/ Xxxxxx X. X'Xxxxx
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Name: Xxxxxx X. X'Xxxxx
Title: President and Chief Executive Officer
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