INTERSECTIONS INC.
June 30, 2006
Xx. Xxxxxxx X. Xxxxxxxxx
Chief Executive Officer
Chartered Marketing Services, Inc.
000 Xxxx Xxxxxxxxxx Xxxxx
Xxxxxxxxx Xxxxxxx, Xxxxxxxx 00000
Xx. Xxxxxxx X. Xxxxxxxx
Shareholder Representative
c/o Chartered Holdings, LLC
000 Xxxx Xxxxxxxxxx Xxxxx
Xxxxxxxxx Xxxxxxx, Xxxxxxxx 00000
Re: Merger Agreement dated June 9, 2006 among Chartered Marketing
Services, Inc., CMSI Merger Inc., Intersections Inc. and the
other parties thereto
Dear Messrs. Xxxxxxxxx and Xxxxxxxx:
Reference is made to the captioned Merger Agreement (the "Merger
Agreement"), and capitalized terms used but not otherwise defined in this letter
agreement shall have the meanings ascribed to such terms in the Merger
Agreement. This letter will evidence our agreement as follows:
1. Notwithstanding the provisions of Section 1.7 of the Merger
Agreement or anything else in the Merger Agreement to the contrary, prior to the
Closing the Company shall make a payment to each of the Option Holders in the
amount set forth on, and in accordance with, the attached Exhibit A and such
aggregate amount will not be deposited by Purchaser with the Escrow Agent and
will not subsequently be disbursed to such Option Holders by the Escrow Agent.
2. Notwithstanding the last two sentences of Section 1.12 of the
Merger Agreement or anything else in the Merger Agreement to the contrary, the
Company itself, on or before the Closing, will pay the transaction bonuses which
are or become payable to Company Employees as a result of the Merger and such
amounts will not be deposited by Purchaser with the Escrow Agent and will not
subsequently be disbursed to such Option Holders by the Escrow Agent.
3. Notwithstanding the express provisions of Section 1.11 of the
Merger Agreement or anything else in the Merger Agreement to the contrary, (a)
upon confirmation that the Articles of Merger have been filed with the
Secretary, Purchaser shall deposit with the Escrow Agent the aggregate amount of
Indebtedness of the Company that shall be outstanding as of July 5, 2006 (based
on the Company's good faith written estimate thereof) in cash by wire transfer
of immediately available funds for deposit in the Closing Escrow Account and (b)
upon confirmation by the Secretary that the Articles of Merger have been
accepted by the Secretary, Purchaser and the Shareholder Representative shall
jointly deliver to the Escrow Agent a Joint Written Notice, which Joint Written
Notice shall direct the Escrow Agent to pay from the Closing Escrow Account by
wire transfer of immediately available funds to the account designated by the
Company pursuant to such Section 1.11 the amount of such outstanding
Indebtedness plus any additional Indebtedness representing accrued interest from
July 5, 2006 through the time and date such total Indebtedness is actually paid
from the Escrow Account (such additional Indebtedness, the "Accrued Interest
Indebtedness").
4. Notwithstanding anything in Sections 1.8(b) or 1.8(d) of the Merger
Agreement or anything else in the Merger Agreement to the contrary, for purposes
of Purchaser's preparation and delivery to the Shareholder Representative of the
Closing Date Balance Sheet and its corresponding Closing Working Capital
Statement, the current liabilities of the Company shall include the Accrued
Interest Indebtedness referred to in Paragraph 3 above, plus $1,250 representing
the Company's one-half share of the $2,500 escrow fee under the Escrow
Agreement.
5. Purchaser and Shareholder Representative acknowledge receipt of the
updated schedules attached hereto as Exhibit B and agree that the attached
Estimated Closing Work Capital Statement shall be utilized for purposes of
Section 1.8(a) of the Agreement.
6. Upon confirmation that the Articles of Merger have been filed with
the Secretary of State of the State of Illinois, the Purchaser and the Company
shall make the deposits as set forth on EXHIBIT C. In the event of the
termination of the Merger Agreement, Purchaser and the Representative shall
direct the Escrow Agent to return the foregoing amounts to the Purchaser and the
Company plus a prorated portion (based upon the initial deposits) of any amounts
thereafter remaining in the Escrow Account. Upon confirmation by the Secretary
that the Articles of Merger have been accepted by the Secretary of State,
Purchaser and the Shareholder Representative shall deliver a Joint Written
Notice to the Escrow Agent to make the payments as set forth on Exhibit D.
7. Except as expressly provided herein, all other terms and conditions
of the Merger Agreement shall remain unchanged and shall continue in full force
and effect.
Sincerely,
Intersections Inc.
By: /s/ Xxxx X. Xxxxx
-------------------------
Name: Xxxx X. Xxxxx
Title: CFO
AGREED AND ACCEPTED:
Chartered Marketing Services, Inc.
By: /s/ Xxxxxxx X. Xxxxxxxxx
------------------------------------------------
Xxxxxxx X. Xxxxxxxxx, CEO
/s/ Xxxxxxx X. Xxxxxxxx
-----------------------------------------------
Xxxxxxx X. Xxxxxxxx, Shareholder Representative
List of Schedules and Exhibits to the Letter Agreement dated June 30, 2006
Exhibit A - Schedule including payments to be made by the Company
to each of the Option Holders
Exhibit B - Schedule including Estimated Closing Work Capital
Statement
Exhibit C - Schedule including deposits of the Purchaser and the
Company
Exhibit D - Schedule including payments of Escrow Agent
[The schedules and exhibits described above have been omitted.
Intersections Inc. will furnish copies of such schedules and exhibits
supplementally to the Commission upon request.]
