AMENDED AND RESTATED AGREEMENT
THIS AMENDED AND RESTATED AGREEMENT ("Agreement"), dated the 4th day
of December, 2008 ("Effective Date"), is made by and between Fair Xxxxx
Corporation, a Delaware corporation (the "Company"), on the one hand, and
Xxxxxxx Asset Management Corp., a Cayman Islands exempted company ("SAMC"),
Castlerigg Master Investments Ltd., a British Virgin Islands company
("Castlerigg Master Investments"), Castlerigg International Limited, a British
Virgin Islands company ("Castlerigg International"); Castlerigg International
Holdings Limited, a British Virgin Islands company ("Castlerigg Holdings"
collectively with SAMC, Castlerigg Master Investments, Castlerigg International
and Castlerigg Holdings, the "Xxxxxxx Group"), on the other hand.
WHEREAS, the Xxxxxxx Group has filed a Schedule 13D with the
Securities and Exchange Commission (the "SEC") on June 29, 2007, as amended on
October 12, 2007, December 7, 2007 and as may be amended from time to time (the
"Schedule 13D");
WHEREAS, Directors Xxx Xxxxxxx and Xxxx Xxxxxxxxxxxx have determined
not to stand for re-election to the Company's Board of Directors (the "Board")
at the Company's 2009 Annual Meeting of Stockholders (including any adjournment
or postponement thereof, the "2009 Annual Meeting");
WHEREAS, the Company and the Xxxxxxx Group previously entered into
that certain agreement, dated as of December 7, 2007 (the "Prior Agreement"), to
undertake certain changes to the composition of the Company's Board; and
WHEREAS, the Company and the Xxxxxxx Group desire to amend and restate
the Prior Agreement and have agreed that it is in their mutual interests to
enter into this Agreement as hereinafter described.
NOW, THEREFORE, in consideration of the premises and the
representations, warranties, and agreements contained herein, and other good and
valuable consideration, the parties hereto mutually agree as follows:
1. REPRESENTATIONS AND WARRANTIES OF THE XXXXXXX GROUP. The Xxxxxxx Group
hereby represents and warrants to the Company as follows:
(a) The Xxxxxxx Group has beneficial ownership of 2,874,000 shares of
common stock of the Company and has full power and authority to enter into this
Agreement and to bind the entire number of shares of the common stock of the
Company which it holds, or may hold, including any shares purchased in the
future, to the terms of this Agreement.
(b) This Agreement constitutes a valid and binding agreement of the
Xxxxxxx Group. Except that Xxxxxx X. Xxxxxxx may be deemed to beneficially own
shares of the Company and except as set forth in Section 1(a) hereof, no
"affiliate" or "associate" (as such terms are defined in the Securities Exchange
Act of 1934, as amended (the "Exchange Act")) of the Xxxxxxx Group beneficially
owns any shares or rights to acquire shares of common stock of the Company.
2. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company hereby
represents and warrants to the Xxxxxxx Group, as follows:
(a) The Company has full power and authority to enter into and perform
its obligations under this Agreement, and the execution and delivery of this
Agreement by the Company has been duly authorized by the Board and requires no
further Board or stockholder action, other than amendment of the bylaws of the
Company to increase the size of the Board by two members.
(b) This Agreement constitutes a valid and binding obligation of the
Company and the performance of its terms does not constitute a violation of its
certificate of incorporation or bylaws.
3. DIRECTORSHIPS. The Company agrees that:
(a) Xxxx Xxxxxxxx, Xxxxx Xxxxx, Xxxx X. XxXxxxxxx and an individual
selected by the Board who is reasonably acceptable to the Xxxxxxx Group
(collectively, the "Nominees") will each be nominated by the Board as a director
at the Company's 2009 Annual Meeting of Stockholders (including any adjournment
or postponement thereof, the "2009 Annual Meeting");
(b) the Company's Board will recommend a vote "for" the Nominees at
the 2009 Annual Meeting, and shall solicit its stockholders to vote for such
Nominees;
(c) proxies solicited by the Company's Board will be voted "for" the
Nominees at the 2009 Annual Meeting; and
(d) from the date hereof through the term of his term of office as a
director, each of Xx. Xxxxxxxx, Xx. Xxxxx and Xx. XxXxxxxxx may each be replaced
by another designee of the Xxxxxxx Group who is reasonably acceptable to the
Company's Board in the event that Xx. Xxxxxxxx, Xx. Xxxxx or Xx. XxXxxxxxx dies,
is unable to perform his duties as a director, or, in the case of Xx. Xxxxxxxx,
is no longer associated with the Xxxxxxx Group.
2
4. VOTING AT MEETINGS OF STOCKHOLDERS.
(a) At the 2009 Annual Meeting, the Xxxxxxx Group shall cause all of
the shares of the Company common stock beneficially owned by it to be present
for quorum purposes and to be voted:
(i) For each of (A) the Nominees and (B) the other candidates
recommended by the Board in the Schedule 14A filed by the Company with the SEC
for election to the Board (the "Company Nominees"); PROVIDED THAT the Company
Nominees are each either current members of the Board or otherwise reasonably
acceptable to the Xxxxxxx Group; and
(ii) for the ratification of the selection of the Company's
independent auditors.
5. THE XXXXXXX GROUP'S PROHIBITED CONDUCT. During the period commencing
with the execution of this Agreement and ending on the earlier to occur of (a)
the date that is eighty (80) days prior to the date of the Company's 2010 Annual
Meeting of Stockholders (PROVIDED, HOWEVER, that if the Board takes any action
to amend the Company's restated bylaws in such a manner as to increase the time
period prior to the 2010 Annual Meeting of Stockholders by which a holder of the
Company's common stock must provide timely notice to the Company of (i) its
nomination of a person or persons to the Board at a meeting of the Company's
stockholders, (ii) or of its proposal to bring business before a meeting of the
Company's stockholders (clause (i) and (ii) together, the "Stockholder
Matters"), then the Standstill Period (as defined herein) shall expire ten (10)
days prior to the date on which a stockholder must give notice to the Company
with respect to any Stockholder Matters), and (b) a material breach by the
Company of its obligations under this Agreement (the "Standstill Period"),
neither the Xxxxxxx Group nor any of its controlled affiliates shall, without
the prior written consent of the Company:
(a) acquire or agree to acquire, or publicly offer or propose to
acquire, directly or indirectly, by purchase or otherwise, any voting securities
or direct or indirect rights or options to acquire any voting securities of the
Company or any subsidiary thereof, or any assets of the Company or any
subsidiary or division thereof; PROVIDED, HOWEVER, that nothing herein shall
limit the ability of the Xxxxxxx Group to (i) transfer any voting securities or
direct or indirect rights or options to acquire any voting securities of the
Company to any of its controlled affiliates, so long as such any such controlled
affiliates agree to be bound by the terms of this Agreement and execute a
joinder agreement to this Agreement, in the form attached hereto as Exhibit A (a
"Joinder Agreement"), (ii) enter into any swap or other arrangement whereby it
acquires the economic consequences of ownership of the common stock without also
acquiring the voting or other rights, privileges or powers associated with the
ownership of the underlying common stock, or (iii) subject to applicable law,
including federal securities laws prohibiting xxxxxxx xxxxxxx, acquire up to ten
percent (10%) of the outstanding shares of Company common stock;
3
(b) other than as provided in this Agreement, seek or propose to
influence or control the management or the policies of the Company (provided
that the Nominees' actions (or those of their replacements as contemplated by
Section 3) as members of the Board shall not be deemed to violate the foregoing)
or to obtain representation on the Board (other than the nomination of the
Nominees), directly or indirectly engage in any activities in opposition to the
recommendation of the Board (including the recommendation of the Nominees and
the Company Nominees as directors to be elected at the 2009 Annual Meeting),
submit any proposal (whether pursuant to Rule 14a-8 or otherwise) or nomination
of a director or directors for stockholder action, or solicit, or encourage or
in any way participate in the solicitation of, any proxies or consents with
respect to any voting securities of the Company, PROVIDED, HOWEVER, that the
foregoing shall not prohibit the Xxxxxxx Group from (i) making public statements
(including statements contemplated by Rule 14a-1(1)(2)(iv) under the Exchange
Act), or (ii) engaging in discussions with other stockholders or (iii)
soliciting, or encouraging or participating in the solicitation of, proxies or
consents with respect to voting securities of the Company (so long as such
discussions are in compliance with subsection (d) hereof (clauses (i), (ii) and
(iii), together, "Permitted Actions") with respect to any transaction that has
been publicly announced by the Company involving (1) the recapitalization of the
Company, (2) an acquisition, disposition or sale of assets or a business by the
Company where (A) the consideration to be received or paid in such transaction
exceeds $400 million in the aggregate or (B) requires approval by the holders of
common stock of the Company, or (3) a change of control of the Company (each, a
"Material Transaction"), PROVIDED, FURTHER, that in the event that one of the
Nominees votes against an acquisition, disposition or sale of assets or a
business by the Company, which is neither a Material Transaction nor an
acquisition, disposition or sale of assets or a business by the Company where
the consideration to be received or paid in such transaction is less than $125
million in the aggregate, at the Board meeting approving such transaction, the
Company will make a public statement that such Nominee so voted;
(c) make any public announcement with respect to, or publicly offer to
effect, seek or propose (with or without conditions) a merger, consolidation,
business combination or other extraordinary transaction with or involving the
Company or any of its subsidiaries or any of its or their securities or assets,
PROVIDED, HOWEVER, that nothing in this subsection (c) shall restrict the
Xxxxxxx Group from taking Permitted Actions with respect to a Material
Transaction;
(d) (i) form, join or in any way participate in a "group" as defined
in Section 13(d)(3) of the Exchange Act, and the rules and regulations
promulgated thereunder, other than a "group" that includes all or some lesser
number of persons identified as members of the Xxxxxxx Group, or (ii) enter into
any negotiations, arrangements or understandings with any third parties, other
than members of the Xxxxxxx Group solely with respect to the existing members of
the Xxxxxxx Group, in connection with becoming a "group" as defined in Section
13(d)(3) of the Exchange Act;
(e) publicly disparage any member of the Board or management of the
Company; or
4
(f) publicly seek or request permission to do any of the foregoing,
request to amend or waive any provision of this Section 5 (including, without
limitation, any of clauses (a)-(e) hereof), or make or seek permission to make
any public announcement with respect to any of the foregoing.
6. TRANSFER RESTRICTIONS. The Xxxxxxx Group agrees that, during the
Standstill Period, it shall not offer, pledge, sell, contract to sell, sell any
option or contract to purchase, purchase any option or contract to sell, grant
any option, right or warrant to purchase, lend (other than in a customary
commingled brokerage account in the ordinary course of business), or otherwise
transfer or dispose of, directly or indirectly, any shares of common stock or
any securities convertible into or exercisable or exchangeable, directly or
indirectly, for common stock, whether any such transaction described above is to
be settled by delivery of common stock or such other securities, in cash or
otherwise (any such action a "Transfer"), in each case without the prior written
consent of the Company; PROVIDED THAT the foregoing shall not restrict the
Xxxxxxx Group from (i) a Transfer of any shares to a controlled affiliate which
agrees to be bound by the terms of this Agreement and executes a Joinder
Agreement, (ii) subject to compliance with law, the Transfer of shares in either
(1) brokers' transactions (within the meaning of Rule 144(g) of the Securities
Act of 1933 (the "Securities Act")), but not in transactions directly with a
market maker (as defined in Section 3(a)(38) of the Exchange Act), or (2)
private Transfers (including transactions with, or indirectly through, a market
maker), in a single Transfer or series of related Transfers, so long as the
Xxxxxxx Group, at the time of such Transfer, does not have actual knowledge,
after reasonable inquiry, that such Transfer or series of Transfers would result
in the ultimate purchaser of such shares of common stock from the Xxxxxxx Group
beneficially owning, together with its affiliates, following such Transfer or
Transfers, in excess of five percent (5%) of the Company's common stock in the
aggregate, or (iii) Transfers made pursuant to (x) tender offers in respect of
the Company's common stock made by the Company or any third party, or (y)
repurchase offers in respect of the Company's common stock made directly with
the Company.
7. RESIGNATION. Each of Xx. Xxxxxxxx, Xx. Xxxxx and Xx. XxXxxxxxx (and
any replacement director appointed to the Board pursuant to Section 3(d)) shall
immediately tender his resignation from the Board, if requested by the Board as
a result of a majority vote of the directors, other than the Nominees, in favor
of such resignations from the Board, in the event that the Xxxxxxx Group's
beneficial ownership of the Company's common stock becomes less than three
percent (3%) of the outstanding shares of common stock of the Company solely as
a result of a Transfer or series of Transfers by the Xxxxxxx Group.
8. NONDISPARAGEMENT. During the Standstill Period, the Company shall not
publicly disparage the Xxxxxxx Group or any member of the management of the
Xxxxxxx Group.
9. PUBLIC ANNOUNCEMENT. The Company shall disclose the existence of this
Agreement after its execution pursuant to a Company press release reasonably
acceptable to the Xxxxxxx Group; HOWEVER, neither party shall disclose the
existence of this Agreement until the press release is issued except as
otherwise required by applicable law, rule or regulation and
5
provided that the non-disclosing party is provided a reasonable opportunity to
review and comment upon any such disclosure and the disclosing party considers
in good faith any such comments provided by the non-disclosing party.
10. REMEDIES. The Company and the Xxxxxxx Group acknowledge and agree that
a breach or threatened breach by either party may give rise to irreparable
injury inadequately compensable in damages, and accordingly each party shall be
entitled to injunctive relief to prevent a breach of the provisions hereof and
to enforce specifically the terms and provisions hereof in any state or federal
court having jurisdiction, in addition to any other remedy to which such
aggrieved party may be entitled to at law or in equity. In the event either
party institutes any legal action to enforce such party's rights under, or
recover damages for breach of, this Agreement, the prevailing party or parties
in such action shall be entitled to recover from the other party or parties all
costs and expenses, including but not limited to reasonable attorneys' fees,
court costs, witness fees, disbursements and any other expenses of litigation or
negotiation incurred by such prevailing party or parties.
11. NOTICES. All notice requirements and other communications shall be
deemed given when delivered or on the following business day after being sent by
overnight courier with a nationally recognized courier service such as Federal
Express, addressed to the Company, SAMC, Castlerigg Master Investments,
Castlerigg International, Castlerigg Holdings and Xx. Xxxxxxx as follows:
THE COMPANY:
Fair Xxxxx Corporation
000 Xxxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxxxxxx, XX 00000-0000
Facsimile: (000) 000-0000
Attention: General Counsel
With a copy to (which shall not constitute notice):
Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP
000 Xxxxxxxxxx Xxxxxx, Xxxxx 0000
Xxxx Xxxx, Xxxxxxxxxx 00000
Facsimile: (000) 000-0000
Attention: Xxxxxx X. Xxxx
M. Amr Xxxxxx
THE SANDELL GROUP:
Xxxxxxx Asset Management Corp.
00 X 00xx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Facsimile: (000) 000-0000
6
Attn: General Counsel
with copies to (which shall not constitute notice):
Xxxxxxx Xxxx & Xxxxx LLP
000 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Facsimile: (000) 000-0000
Attention: Xxxx Xxxxxxxxxx
12. ENTIRE AGREEMENt. This Agreement constitutes the entire agreement
between the parties hereto pertaining to the subject matter hereof and
supersedes all prior and contemporaneous agreements understandings, negotiations
and discussions of the parties in connection therewith not referred to herein.
13. COUNTERPARTS; FACSIMILE. This Agreement may be executed in any number
of counterparts and by the parties hereto in separate counterparts, and
signature pages may be delivered by facsimile, each of which when so executed
shall be deemed to be an original and all of which taken together shall
constitute one and the same agreement.
14. HEADINGS. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.
15. GOVERNING LAW. This Agreement shall be governed by and construed and
enforced in accordance with the laws of the State of Delaware, without regard to
choice of law principles that would compel the application of the laws of any
other jurisdiction.
16. SEVERABILITY. In the event one or more of the provisions of this
Agreement should, for any reason, be held to be invalid, illegal or
unenforceable in any respect, such invalidity, illegality or unenforceability
shall not affect any other provisions of this Agreement, and this Agreement
shall be construed as if such invalid, illegal or unenforceable provision had
never been contained herein.
17. SUCCESSORS AND ASSIGNS. This Agreement shall not be assignable by any
of the parties to this Agreement. This Agreement, however, shall be binding on
successors of the parties hereto.
18. SURVIVAL OF REPRESENTATIONS, WARRANTIES AND AGREEMENTS. All
representations, warranties, covenants and agreements made herein shall survive
the execution and delivery of this Agreement.
7
19. AMENDMENTS. This Agreement may not be modified, amended, altered or
supplemented except upon the execution and delivery of a written agreement
executed by all of the parties hereto.
20. FURTHER ACTION. Each party agrees to execute any and all documents,
and to do and perform any and all acts and things necessary or proper to
effectuate or further evidence the terms and provisions of this Agreement.
21. CONSENT TO JURISDICTION. Each of the parties hereby irrevocably
submits to the exclusive jurisdiction of any state court sitting in the State of
Delaware in any action or proceeding arising out of or relating to this
Agreement and each of the parties hereby irrevocably agrees that all claims in
respect of such action or proceeding may be heard and determined in any such
court.
22. EXPENSES. Each party agrees to bear its own expenses in connection
with the transactions contemplated hereby.
[SIGNATURE PAGE FOLLOWS]
8
The Company and the Xxxxxxx Group each indicate its agreement
with the foregoing by signing and returning one copy of this agreement,
whereupon this letter agreement will constitute their agreement with respect to
the subject matter hereof.
Accepted to and agreed,
as of the date first written above:
FAIR XXXXX CORPORATION
By: /s/ Xxxx X. Xxxxxx
--------------------------
Name: Xxxx X. Xxxxxx
Title: CEO
XXXXXXX ASSET MANAGEMENT CORP.
By: /s/ Xxxxxx X. Xxxxxxx
--------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Chief Executive Officer
CASTLERIGG MASTER INVESTMENTS LTD.
BY: XXXXXXX ASSET MANAGEMENT CORP.
By: /s/ Xxxxxx X. Xxxxxxx
--------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Chief Executive Officer
CASTLERIGG INTERNATIONAL LIMITED
BY: XXXXXXX ASSET MANAGEMENT CORP.
By: /s/ Xxxxxx X. Xxxxxxx
--------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Chief Executive Officer
CASTLERIGG INTERNATIONAL HOLDINGS LIMITED
BY: XXXXXXX ASSET MANAGEMENT CORP.
By: /s/ Xxxxxx X. Xxxxxxx
--------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Chief Executive Officer
EXHIBIT A
FORM OF JOINDER AGREEMENT
The undersigned hereby agrees, effective as of the date hereof, to become a
party to that certain Amended and Restated Agreement, dated as of December [o],
2008, by and among Fair Xxxxx Corporation, a Delaware corporation (the
"Company"), Xxxxxxx Asset Management Corp., a Cayman Islands exempted company
("SAMC"), Castlerigg Master Investments Ltd., a British Virgin Islands company
("Castlerigg Master Investments"), Castlerigg International Limited, a British
Virgin Islands company ("Castlerigg International"); Castlerigg International
Holdings Limited, a British Virgin Islands company ("Castlerigg Holdings" and
collectively with SAMC, Castlerigg Master Investments, Castlerigg International
and Castlerigg Holdings, the "Xxxxxxx Group") (the "Agreement"). By executing
this joinder agreement, the undersigned hereby agrees to be, and shall be,
deemed a member of the "Xxxxxxx Group" for all purposes of the Agreement,
entitled to the rights and subject to the obligations thereunder with respect to
the voting securities of the Company acquired from the Xxxxxxx Group.
The address and facsimile number to which notices may be sent to the undersigned
is as follows:
Facsimile No.:
By:
--------------------------------
Name:
--------------------------------
Title:
--------------------------------
Date:
--------------------------------
A-1
