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STOCK PURCHASE AGREEMENT
BY AND AMONG
XXXXXX HOLDINGS, INC.,
THE STOCKHOLDERS OF XXXXXX HOLDINGS, INC.
LISTED ON THE SIGNATURE PAGES HERETO
AND
CH ACQUISITIONS LLC
AS OF JULY 12, 2001
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TABLE OF CONTENTS
Page
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ARTICLE I DEFINITIONS...................................................................1
Definitions................................................................................1
ARTICLE II PURCHASE AND REDEMPTION OF SHARES.............................................6
2.1 Purchase, Sale and Redemption of Seller Shares....................................6
2.2 Redemption of Additional Shares...................................................6
2.3 Purchase Price....................................................................7
2.4 Company Stock Options.............................................................7
2.5 Redemption of Remaining Shares....................................................7
2.6 Rollover of Management Stock and Options..........................................7
2.7 Closing Date......................................................................7
2.8 Conversion of Shares..............................................................8
ARTICLE III REPRESENTATIONS AND WARRANTIES OF THE COMPANY.................................8
3.1 Corporate Organization............................................................8
3.2 Capital Stock.....................................................................8
3.3 Subsidiaries......................................................................9
3.4 Corporate Authority; Noncontravention.............................................9
3.5 SEC Reports and Financial Statements.............................................10
3.6 Absence of Material Adverse Effects..............................................10
3.7 Insurance........................................................................10
3.8 Taxes............................................................................10
3.9 Governmental Permits.............................................................11
3.10 Ownership of Property............................................................11
3.11 Intellectual Property............................................................12
3.12 Labor Relations..................................................................13
3.13 Employee Benefit Plans...........................................................14
3.14 Certain Contracts................................................................16
3.15 Compliance with Law..............................................................17
3.16 Environmental Matters............................................................17
3.17 Litigation.......................................................................17
3.18 Finders..........................................................................17
3.19 Third-Party Consents.............................................................18
3.20 Undisclosed Liabilities..........................................................18
3.21 Disclosure.......................................................................18
3.22 Customers........................................................................18
3.23 Suppliers........................................................................18
3.24 Books and Records................................................................18
3.25 No Illegal Payments..............................................................18
3.26 Transactions with Affiliates.....................................................19
ARTICLE IV REPRESENTATIONS AND WARRANTIES OF THE SELLERS................................19
4.1 Authority and Related Matters....................................................19
4.2 No Finder........................................................................20
ARTICLE V REPRESENTATIONS AND WARRANTIES OF PURCHASER..................................20
5.1 Organization of Purchaser........................................................20
5.2 Authority of Purchaser...........................................................20
5.3 No Finder........................................................................21
5.4 Absence of Proceedings...........................................................21
5.5 Investment Intent................................................................21
5.6 Status as Accredited Investor....................................................21
5.7 Financial Capability.............................................................21
5.8 No Outside Reliance..............................................................21
5.9 Governmental Consents............................................................21
ARTICLE VI ADDITIONAL COVENANTS.........................................................22
6.1 Investigation by Purchaser.......................................................22
6.2 Confidentiality..................................................................22
6.3 Certain Agreements...............................................................22
6.4 Operations Prior to the Closing Date.............................................22
6.5 No Public Announcement; Confidentiality..........................................24
6.6 Governmental Filings; Consents...................................................25
6.7 Directors' and Officers' Indemnification.........................................25
6.8 Employee Benefits................................................................26
6.9 Debt Obligations.................................................................26
6.10 Interim Financials: Cooperation with Financing...................................26
6.11 Notification of Certain Matters..................................................26
6.12 Non-solicitation of Employees....................................................26
ARTICLE VII CONDITIONS PRECEDENT TO OBLIGATION OF PURCHASER..............................27
7.1 No Misrepresentation or Breach...................................................27
7.2 Resignations of Directors........................................................27
7.3 Litigation.......................................................................28
7.4 Governmental Approvals...........................................................28
7.5 FIRPTA Affidavit.................................................................28
7.6 Shareholder Approval for Certain Payments or Benefits............................28
7.7 Legal Opinions...................................................................28
7.8 Availability of Funds............................................................28
7.9 Officer's Certificate............................................................28
7.10 Delivery of Documents............................................................28
7.11 Termination of Certain Agreements................................................28
7.12 Transaction Expenses.............................................................28
ARTICLE VIII CONDITIONS PRECEDENT TO OBLIGATIONS OF THE COMPANY AND THE SELLERS...........29
8.1 No Misrepresentation or Breach...................................................29
8.2 Litigation.......................................................................29
8.3 Governmental Approvals...........................................................29
8.4 Officer's Certificate............................................................29
ARTICLE IX TERMINATION..................................................................29
9.1 Termination......................................................................29
9.2 Effect of Termination............................................................30
ARTICLE X GENERAL PROVISIONS...........................................................30
10.1 Non-survival of Representations and Warranties...................................30
10.2 Notices..........................................................................30
10.3 Partial Invalidity...............................................................31
10.4 Execution in Counterparts; Facsimile Signatures..................................31
10.5 Governing Law....................................................................31
10.6 Expenses.........................................................................32
10.7 Assignment; Successors and Assigns; No Third Party Beneficiaries.................32
10.8 No Implied Representation........................................................32
10.9 Titles and Headings..............................................................32
10.10 Schedules and Exhibits...........................................................32
10.11 Knowledge........................................................................32
10.12 Entire Agreement; Amendments.....................................................33
10.13 Waivers..........................................................................33
10.14 Waiver of Jury Trial.............................................................33
EXHIBITS AND SCHEDULES
Exhibit A Sellers
Exhibit B Management Bonus
Exhibit C Xxxxxxx Xxxxx Commitment Letters
Exhibit D Rollover Shares
Exhibit E Sellers' Notice Information
Schedule 3.2 Capital Stock
Schedule 3.3 Subsidiaries
Schedule 3.4 Corporate Authority; Noncontravention
Schedule 3.5 SEC Reports and Financial Statements
Schedule 3.7 Insurance
Schedule 3.10 Ownership of Property
Schedule 3.11 Intellectual Property
Schedule 3.14 Contracts
Schedule 3.15 Compliance with Law
Schedule 3.16 Environmental Matters
Schedule 3.17 Litigation
Schedule 3.19 Third Party Consents
Schedule 3.20 Undisclosed Liabilities
Schedule 3.22 Customers
Schedule 3.23 Suppliers
Schedule 3.26 Transactions with Affiliates
Schedule 4.1 Seller Authority and Related Matters
Schedule 6.4 Operations Prior to Closing Date
Schedule 6.8 Employee Benefits
Schedule 10.11 Persons Having Knowledge
STOCK PURCHASE AGREEMENT
This
STOCK PURCHASE AGREEMENT is dated as of July 12, 2001,
by and among those Persons listed on EXHIBIT A hereto (each individually, a
"SELLER", collectively, the "SELLERS"), Xxxxxx Holdings, Inc., a
Massachusetts corporation (the "COMPANY"), and CH Acquisitions LLC, a
Delaware limited liability company ("PURCHASER").
BACKGROUND
A. The outstanding equity securities of the Company
consist of shares of Class A Stock, Class C Stock and Class D Stock, each
having a par value of $.01 per share.
B. The Class D Sellers are the owners of 100% of the
outstanding shares of Class D Stock as set forth on Exhibit A hereto.
C. The Class A and C Sellers and the Management
Sellers are the owners of the shares of Class A Stock and Class C Stock set
forth on Exhibit A hereto.
D. Pursuant to the Certificate of Designations of the
Company as filed with the Secretary of the Commonwealth of the Commonwealth
of Massachusetts (the "CERTIFICATE OF DESIGNATIONS"), holders of Class A
Stock and Class C Stock of the Company that are not otherwise bound by this
Agreement are entitled to participate pursuant to tag-along rights in any
proposed sale of Class D Stock by holders thereof and are subject to
mandatory redemption under the circumstances set forth in the Certificate of
Designations.
E. The Class D Sellers desire to sell to Purchaser
all shares of Class D Stock; the Management Sellers desire to sell to
Purchaser all of the Management Shares other than shares that are retained by
the Management Sellers; and the Company desires to issue and sell to
Purchaser shares of Common Stock. Purchaser desires to purchase such Class D
Stock, Management Shares and shares of Common Stock.
F. Using the proceeds of borrowings by the Company
and TWCC and the sale of Common Stock to Purchaser, the Company and Purchaser
are willing to provide the funds necessary to redeem or purchase the
remaining shares of Class A Stock and Class C Stock.
AGREEMENT
NOW, THEREFORE, in consideration of the foregoing and the
representations, warranties and agreements set forth herein, the parties
agree as follows:
ARTICLE I
DEFINITIONS
In addition to the other words and terms defined elsewhere
in the Agreement, as used in this Agreement, the following words and terms
have the meanings specified or referred to below:
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"ADDITIONAL SHARES" has the meaning specified in Section 2.2.
"AGGREGATE OPTION EXERCISE PRICE" means an amount equal to
the aggregate dollar amount of the exercise price of all Company Options
outstanding immediately prior to the Closing.
"AGGREGATE PURCHASE PRICE" means an amount equal to (i) the
Buyer Purchase Price, PLUS (ii) the Aggregate Option Exercise Price, LESS
(iii) the amount, if any, by which Transaction Expenses exceed $11,285,000.00.
"BRIDGE FACILITY" has the meaning specified in Section 5.7.
"BUYER PURCHASE PRICE" means $252,515,000.00.
"CERTIFICATE OF DESIGNATIONS" has the meaning specified in
the recitals to this Agreement.
"CLASS A STOCK" has the meaning specified in Section 3.2.
"CLASS C STOCK" has the meaning specified in Section 3.2.
"CLASS A AND C SELLERS" means the holders of Class A Stock
and Class C Stock that are listed on EXHIBIT A hereto, but specifically
excluding the Management Sellers..
"CLASS D SELLERS" means the holders of Class D Stock.
"CLASS D STOCK" has the meaning specified in Section 3.2.
"CLOSING" has the meaning specified in Section 2.7.
"CLOSING DATE" has the meaning specified in Section 2.7.
"CODE" means the Internal Revenue Code of 1986, as amended.
"COMMON STOCK" has the meaning specified in Section 3.2.
"COMPANY" has the meaning specified in the first paragraph
of this Agreement.
"COMPANY INTELLECTUAL PROPERTY" has the meaning specified
in Section 3.11(a).
"COMPANY OPTION" has the meaning specified in Section 3.2.
"COMPANY OPTION PLAN" has the meaning specified in Section
3.2.
"CONFIDENTIALITY AGREEMENT" has the meaning specified in
Section 6.2.
"DEFINED BENEFIT PLAN" has the meaning specified in Section
3.13(a).
"ELECTING STOCKHOLDERS" has the meaning specified in
Section 2.2.
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"EMPLOYEE BENEFIT PLAN" has the meaning specified in
Section 3.13(a).
"EMPLOYEE PLAN" has the meaning specified in Section
3.13(a).
"ENCUMBRANCE" means any lien, claim, charge, security
interest, mortgage purchase right or restriction on transfer or pledge.
"ENVIRONMENTAL LAWS" means the Comprehensive Environmental
Response, Compensation and Liability Act of 1980, 42 U.S.C. Section 9601 ET
SEQ., the Resource Conservation and Recovery Act, 42 U.S.C. Section 6901, the
Federal Water Pollution Control Act, 33 U.S.C. Section 1201, the Clean Water
Act, 33 U.S.C. Section 1321, the Clean Air Act, 42 U.S.C. Section 7401 and
the Toxic Substances Control Act, 15 U.S.C. Section 2601, in each case, as
amended from time to time, or any other federal, state or local law,
ordinance or regulation dealing with the protection of human health from
exposure to Hazardous Substances, natural resources and/or the environment.
"ERISA" means the Employee Retirement Income Security Act
of 1974, as amended.
"FULLY DILUTED NUMBER" means (i) the aggregate number of
outstanding Shares (excluding treasury shares) as of the Closing Date plus
(ii) the aggregate number of Shares issuable upon exercise of all outstanding
Company Options as of the Closing Date.
"GAAP" means United States generally accepted accounting
principles.
"GOVERNMENTAL BODY" means any federal, state, local or
foreign court or tribunal, government, department, commission, board, bureau,
agency, official or other regulatory, administrative or governmental
authority (or any department, bureau or division thereof) or any arbitral
body.
"GOVERNMENTAL PERMITS" has the meaning specified in Section
3.9.
"HAZARDOUS SUBSTANCES" means all "hazardous substances" as
defined pursuant to the Comprehensive Environmental Response, Compensation
and Liability Act (CERCLA), 42 U.S.C. Sec. 9601 et seq. and regulations
promulgated thereunder, polychlorinated biphenyls, asbestos, and petroleum,
including crude oil and all fractions thereof.
"H-S-R ACT" means the Xxxx-Xxxxx-Xxxxxx Antitrust
Improvements Act of 1976, as amended, and the rules and regulations
promulgated thereunder.
"IRS" means the Internal Revenue Service.
"LAWS" means any federal, state, local or foreign law,
code, regulation, rule, order, writ, ordinance, permit, license, injunction,
judgment, ruling or decree, including, without limitation, the Fair Labor
Standards Act, all Environmental Laws and all permitting and approval
requirements.
"LEASED REAL PROPERTY" has the meaning specified in Section
3.10(a).
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"MANAGEMENT BONUS" means the bonuses to be paid to certain
members of management of TWCC on the Closing Date as more specifically set
forth in EXHIBIT B hereto.
"MANAGEMENT SELLERS" means the holders of Class C Stock
that are employees of TWCC and are identified as Management Sellers on
EXHIBIT A hereto.
"MANAGEMENT SHARES" means the Shares of Class C Stock held
by the Management Sellers as specified next to each Management Seller's name
on EXHIBIT A hereto.
"MATERIAL ADVERSE EFFECT" means a material adverse effect
on or change in the assets, results of operations, financial condition,
business, or near-term prospects based on aggregate bookings, of the Company
and its Subsidiaries taken as a whole, except for effects or changes
resulting primarily from (a) general economic conditions or general
conditions in the infant and toddler apparel industry or (b) the announcement
of the transactions contemplated by this Agreement.
"MULTIEMPLOYER PLAN" has the meaning specified in Section
3.13(a).
"NOTES" means (a) the Company's 12% Senior Subordinated
Notes due 2008, and (b) TWCC's 10 3/8% Senior Subordinated Notes due 2006.
"OWNED REAL PROPERTY" has the meaning specified in Section
3.10(a).
"PERMITTED ENCUMBRANCE" has the meaning specified in
Section 3.10(b).
"PER SHARE AMOUNT" means (i) the Aggregate Purchase Price
divided by (ii) the Fully Diluted Number, rounded to the nearest $0.01.
"PERSON" means and includes an individual, a partnership, a
corporation, a limited liability company, a trust, a joint venture, an
unincorporated organization and any governmental or regulatory body or other
agency or authority.
"PROPERTY LEASES" means leases, subleases or other
documents, instruments and agreements to which any of the Company or the
Subsidiaries is a party, whether as lessee, lessor, sublessee or sublessor,
pertaining to the current or future use or occupancy of any Real Property,
together with all amendments, modifications, and supplements thereto.
"PURCHASER" has the meaning specified in the first
paragraph of this Agreement.
"PURCHASER RESIDUAL AMOUNT" shall mean an amount equal to
$145,500,000.00 LESS (i) the aggregate purchase price paid by Purchaser for
the Class D Stock and the Management Shares pursuant to Sections 2.1(a) and
2.1(b) LESS (ii) the product of (X) the number of Rollover Shares multiplied
by (Y) the Per Share Amount LESS (iii) the product of (X) the number of
Company Options exchanged by holders thereof for new options at the Closing
multiplied by (Y) the difference between (1) the Per Share Amount and (2) $60.
"REAL PROPERTY" has the meaning specified in Section
3.10(a).
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"REDEEMED SHARES" has the meaning specified in Section 2.5.
"REPORTING COMPANIES" means the Company and TWCC.
"RETURNS" has the meaning specified in Section 3.8(a).
"ROLLOVER SHARES" means Shares of Class C Stock that the
Management Sellers agree to retain pursuant to Section 2.6.
"SEC" has the meaning specified in Section 3.5.
"SEC FILINGS" has the meaning specified in Section 3.5.
"SECURITIES ACT" means the Securities Act of 1933, as
amended.
"SELLER SHARES" means the Class A Stock, the Class C Stock
and the Class D Stock held by each Seller that is listed on EXHIBIT A hereto,
but specifically excludes for this purpose, the Additional Shares and the
Rollover Shares.
"SELLERS" means the Class D Sellers, each Person listed on
EXHIBIT A hereto as a Seller, as well as, from and after identification
thereof to Purchaser pursuant to the terms hereof, the Electing Stockholders.
"SENIOR CREDIT AGREEMENT" means the Credit Agreement dated
October 30, 1996 among TWCC, certain lenders and The Chase Manhattan Bank as
Administrative Agent, as amended from time to time.
"SHARES" means shares of Class A, Class C or Class D Stock,
as applicable.
"SUBSIDIARY" means any corporation, partnership, joint
venture or other legal entity of which the Company owns, directly or
indirectly, 50% or more of the stock or other equity interests the holders of
which generally are entitled to vote for the election of the board of
directors or other governing body of such corporation, partnership, joint
venture or other legal entity or for which the Company has the right to
control the board.
"TAX" or "TAXES" has the meaning specified in Section
3.8(a).
"TRANSACTION EXPENSES" means the legal, accounting,
financial advisory (including, without limitation the fees of Xxxxxxx, Xxxxx
& Co. as contemplated by Section 3.18) and consulting expenses incurred by
any of the Company, the Subsidiaries or the Sellers in connection with the
transactions contemplated hereby as well as the Management Bonus and the cost
of directors and officers "run-off" or similar insurance policies purchased
by the Company prior to Closing. For the avoidance of doubt, the term
"Transaction Expenses" does not include any fees or expenses incurred by any
party in connection with Purchaser's financing arrangements that are related
to the transactions contemplated hereby.
"TREASURY REGULATIONS" has the meaning specified in Section
3.8(c).
5
"TWCC" means The Xxxxxxx Xxxxxx Company, a Massachusetts
corporation and a wholly-owned Subsidiary of the Company.
"USRPHC" has the meaning specified in Section 3.8(c).
ARTICLE II
PURCHASE AND REDEMPTION OF SHARES
2.1 PURCHASE, SALE AND REDEMPTION OF SELLER SHARES.
Subject to the terms and conditions hereof, on the Closing Date:
(a) Each Class D Seller shall sell to Purchaser, and
Purchaser shall purchase from each Class D Seller, the number of Shares of
Class D Stock specified next to such Seller's name on EXHIBIT A hereto,
representing, in the aggregate, 100% of the issued and outstanding shares of
Class D Stock of the Company.
(b) Each Management Seller shall sell to Purchaser,
and Purchaser shall purchase from each Management Seller, the number of
Management Shares specified next to such Management Seller's name on EXHIBIT
A hereto except for those Shares, if any, that will be retained by the
Management Sellers as indicated on EXHIBIT D. No Management Seller shall
elect to participate in the sale of Shares to Purchaser pursuant to the terms
of the Certificate of Designations or pursuant to any contractual "tag-along"
right.
(c) The Company shall purchase and the Class A and C
Sellers shall sell to the Company the shares of Class A Stock and Class C
Stock set forth on EXHIBIT A hereto. No Class A and Class C Sellers shall
elect to participate in the sale of Shares to Purchaser pursuant to the terms
of the Certificate of Designations.
(d) Purchaser shall purchase and the Company shall
issue and sell to Purchaser the number of shares of Common Stock equal to the
Purchaser Residual Amount divided by the Per Share Amount.
2.2 REDEMPTION OF ADDITIONAL SHARES. Not less than 10
days prior to the Closing, the Company shall notify Purchaser of those
holders of Class A Stock and Class C Stock who have made valid elections to
participate in the sale of Shares to Purchaser pursuant to the terms of the
Certificate of Designations (the "ELECTING STOCKHOLDERS") and the number of
shares of Class A Stock and Class C Stock with respect to which each such
Electing Stockholder has validly exercised such right (the "ADDITIONAL
SHARES"). In order to make a valid election to participate in the sale of
Shares pursuant to this Agreement, each Electing Stockholder shall agree, in
form reasonably satisfactory to and for the benefit of Purchaser, to be bound
by the terms, conditions and other provisions of this Agreement as if a
signatory hereto as of the date hereof and to waive any and all rights to the
contrary under applicable Law or the Certificate of Designations. Subject to
the terms and conditions hereof and the Certificate of Designations, on the
Closing Date, Purchaser (or its designee) shall purchase from the Electing
Stockholders, and the Electing Stockholders shall sell to Purchaser (or its
designee), the Additional Shares.
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2.3 PURCHASE PRICE. The purchase or redemption price
per Share to be paid to each Seller pursuant to this Article II whether paid
by Purchaser or the Company shall be the Per Share Amount, payable in cash in
immediately available funds against delivery of stock certificates
representing the Shares being sold, in proper form and duly endorsed for
transfer. Payment shall be made by wire transfer of immediately available
funds to accounts designated by the Sellers by notice to Purchaser or the
Company, as the case may be, at least two business days prior to the Closing.
2.4 COMPANY STOCK OPTIONS. On the Closing Date the
Company shall pay each holder of a Company Option that is outstanding as of
the Closing Date (other than with respect to Company Options, if any, that
are canceled pursuant to Section 2.6), for each Share covered by such Company
Option, a cash amount equal to the Per Share Amount less the applicable per
share exercise price of such Company Option and any withholding taxes
required by applicable law. All Company Options shall terminate on the
Closing Date.
2.5 REDEMPTION OF REMAINING SHARES. Subject to the
terms and conditions hereof and the Certificate of Designations, on or before
the Closing Date, the Company shall redeem, concurrently with the
consummation of the transactions contemplated by Sections 2.1 and 2.2, those
shares of Class A Stock and Class C Stock that do not constitute Additional
Shares or Seller Shares for purposes of this Agreement (the "REDEEMED
SHARES"). The price to be paid for each Redeemed Share shall be the Per Share
Amount. The Company shall give notice of such redemption at least two
business days prior to the Closing and, on and after the Closing Date, pay
the Per Share Amount in respect of each Redeemed Share to each holder of
Redeemed Shares promptly after the surrender to the Company for cancellation
by such holder of stock certificates representing such Redeemed Shares. In
accordance with Section 5 of the Certificate of Designations, all
certificates representing Redeemed Shares, including certificates not
delivered or surrendered to the Company for cancellation, shall be deemed to
be canceled by the Company as of the Closing Date and shall thereafter no
longer represent any equity interest in or other rights with respect to the
Company other than the right to receive the Per Share Amount in respect of
each Redeemed Share upon surrender of such Redeemed Shares to the Company for
cancellation. If for any reason the Company is unable to pay the amounts
required under this Section 2.5, Purchaser shall in any event be liable for
payment thereof.
2.6 ROLLOVER OF MANAGEMENT STOCK AND OPTIONS. Each
Management Seller, on the one hand, and Purchaser, on the other hand, may
without the consent of any other party hereto (a) reallocate Shares from the
column entitled "Management Shares" on Exhibit A to the column entitled
"Rollover Shares" on Exhibit D, in each case only as it relates to each such
Management Seller and (b) cancel some or all of the Company Options held by
each such Management Seller in exchange for the issuance by the Company of
new options at the Closing.
2.7 CLOSING DATE. Subject to the terms and conditions
hereof including the satisfaction of the conditions set forth in Articles VII
and VIII or waiver thereof by the party or parties entitled to the benefit of
such conditions (it being understood that, in the case of waiver of any
conditions for the benefit of the Company and the Sellers, such waiver may be
made by the Company on behalf of itself and each of the Sellers), the
consummation of the transactions provided for in this Article II (the
"CLOSING") shall take place (a) on September 28, 2001 or (b) on such earlier
date as Purchaser may request after the satisfaction (or waiver) of the
7
conditions set forth in Articles VII and VIII hereof provided that Purchaser
provides the Company with two business days notice or (c) on such other date
as Purchaser and the Company (on behalf of itself and the Sellers) mutually
agree. The date on which the Closing actually occurs is hereinafter referred
to as the "CLOSING DATE." The Closing shall take place at the offices of
Xxxxxx, Xxxx & Xxxxxxxx LLP, 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 or at
such other place as Purchaser and the Company (on behalf of itself and the
Sellers) may mutually agree. For purposes of this Section 2.7 and Section 9.1
hereof, any determination made or action taken by the Company on behalf of
itself and the Sellers shall be deemed to be the determination or act of each
Seller.
2.8 CONVERSION OF SHARES. The Sellers acknowledge that
immediately after the consummation of the transactions contemplated by this
Agreement, each outstanding Rollover Share shall be converted into Common
Stock pursuant to Section 6 of the Certificate of Designations.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
The Company represents and warrants to Purchaser as follows:
3.1 CORPORATE ORGANIZATION. Each of the Company and
the Subsidiaries is a corporation duly organized and in good standing under
the laws of the jurisdiction of its incorporation. Each of the Company and
the Subsidiaries is duly qualified to transact business as a foreign
corporation and is in good standing in each other jurisdiction in which the
ownership or leasing of its properties or assets or the conduct of its
business requires such qualification, except where the failure to so qualify
has not had and would not have a Material Adverse Effect. Each of the Company
and the Subsidiaries has all requisite corporate power to own or lease and to
operate and use its properties and assets and to carry on its businesses as
now conducted. Each of the Company and the Subsidiaries has delivered or made
available to Purchaser complete and correct copies of its articles of
organization (or equivalent thereof) and bylaws, each as in effect on the
date hereof.
3.2 CAPITAL STOCK. As of the date hereof, the
authorized capital stock of the Company consists of 1,280,000 shares of
common stock, par value $.01 per share (the "COMMON STOCK"), 775,000 shares
of Class A stock, par value $.01 per share (the "CLASS A STOCK"), 500,000
shares of Class C stock, par value $.01 per share (the "CLASS C STOCK") and
5,000 shares of Class D stock, par value $.01 per share (the "CLASS D
Stock"). As of the date hereof, 752,808.16 shares of Class A Stock are
outstanding, 211,010.4870 shares of Class C Stock are outstanding, 5,000
shares of Class D Stock are outstanding and no shares of Common Stock are
outstanding. As of the date hereof, options to purchase 74,981.6041 shares of
Class C Stock (each a "COMPANY OPTION") are outstanding pursuant to stock
option agreements entered into between the Company and certain management and
key employees pursuant to the Xxxxxx Holdings, Inc. Management Stock
Incentive Plan (the "COMPANY OPTION PLAN"). SCHEDULE 3.2 includes an accurate
and complete list of the Company Options setting forth the name of the
optionee, the exercise price and the number of shares of Class C Stock
subject to each outstanding Company Option. Except as disclosed in SCHEDULE
3.2, there are no agreements,
8
warrants, puts, calls, rights, preemptive rights, options or other
commitments of any character to which the Company is a party or by which it
is bound which obligates the Company to issue, deliver, register or sell any
additional shares of its capital stock or any securities or instruments
convertible into or exchangeable for any such additional shares of capital
stock. All outstanding Shares are duly and validly issued and fully paid and
nonassessable.
3.3 SUBSIDIARIES. SCHEDULE 3.3 lists each Subsidiary
of the Company and the jurisdiction of its organization. There are no
agreements, warrants, puts, calls, rights, preemptive rights, options or
other commitments of any character to which the Company or any Subsidiary is
a party or by which the Company or any Subsidiary is bound which obligates
the Company or any Subsidiary to issue, deliver, register or sell any
outstanding or additional shares of capital stock of any Subsidiary or any
securities or instruments convertible into or exchangeable for any such
outstanding or additional shares of capital stock. Each outstanding share of
capital stock of each Subsidiary is duly authorized, validly issued, fully
paid and nonassessable and free of preemptive rights and each such share is
owned by the Company or another Subsidiary, free and clear of Encumbrances.
3.4 CORPORATE AUTHORITY; NONCONTRAVENTION.
(a) The Company has all requisite corporate power to
execute and deliver this Agreement, to consummate the transactions
contemplated hereby and to perform its obligations hereunder. The execution,
delivery and performance of this Agreement by the Company have been duly
authorized by all requisite corporate action. This Agreement has been duly
executed and delivered by the Company and constitutes the valid and binding
obligation of the Company enforceable in accordance with its terms (except to
the extent that enforceability may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws relating to creditors'
rights generally or by general principles of equity and public policy).
(b) Except as set forth in SCHEDULE 3.4 and, in each
case, except as would not be reasonably likely to have a material effect on
the transactions contemplated hereby, the execution and delivery of this
Agreement by the Company and each Seller, the consummation by the Company and
each Seller of any of the transactions contemplated hereby, and the
performance by the Company and each Seller of its obligations hereunder will
not:
(i) violate any provision of the articles of
organization (or equivalents thereof) or bylaws of the Company or any
Subsidiary;
(ii) contravene any Law;
(iii) violate or conflict with, constitute a default
of or breach under, entitle any party to accelerate, terminate or
rescind any obligation or right under, or result in the creation or
imposition of any Encumbrance upon any of the assets of the Company or
any Subsidiary pursuant to any provision of, any mortgage, lien, lease,
agreement, indenture, license, instrument to which either the Company
or any Subsidiary is a party or by which any of them or any of their
assets is bound; or
9
(iv) require the approval, consent, authorization or
act of, or the making by the Company or any Subsidiary of any
declaration, filing or registration with, any Governmental Body.
3.5 SEC REPORTS AND FINANCIAL STATEMENTS. Since January 1,
1998, the Reporting Companies have filed all material forms, reports and
documents with the Securities and Exchange Commission (the "SEC") required to
be filed by them pursuant to the federal securities laws and the rules and
regulations promulgated thereunder, and all such forms, reports and documents
filed with the SEC have complied in all material respects with all applicable
requirements of the federal securities laws and the rules and regulations
promulgated thereunder (such forms, reports and documents, together with any
exhibits and any amendments thereto including any related financial
statements and any information incorporated by reference therein are referred
to as the "SEC FILINGS"). As of their respective dates, the SEC Filings did
not contain any untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading. Attached as SCHEDULE 3.5 are the Company's most recent
audited financial statements as well as the Company's most recent quarterly
unaudited financial statements which has been reviewed by the Company's
auditors in compliance with SAS 71. Each of the balance sheets, statements of
operations, statements of equity and statements of cash flow included in the
SEC Filings on or prior to the date hereof were prepared in accordance with
GAAP applied on a consistent basis and fairly present, in all material
respects, the consolidated financial position of the Reporting Companies as
of the dates thereof and the consolidated results of operations and changes
in cash flows of the Reporting Companies for the periods then ended (subject,
in the case of unaudited quarterly financial statements, to normal year-end
adjustments and the absence of notes to such statements).
3.6 ABSENCE OF MATERIAL ADVERSE EFFECTS. Since
December 31, 2000, neither the Company nor any of the Subsidiaries has (a)
suffered any damage, destruction or casualty loss to any of its assets which,
individually or in the aggregate, has a Material Adverse Effect, or (b)
suffered any Material Adverse Effect.
3.7 INSURANCE. SCHEDULE 3.7 is a schedule of all
material insurance policies or binders of insurance which relate to the
business of the Company and the Subsidiaries (excluding insurance funding
Employee Plans) as of the date hereof. To the Company's knowledge, such
policies (i) provide adequate coverage for all customary risks incident to
the Company's and its Subsidiaries' assets, properties and business
operations, and (ii) except as set forth in SCHEDULE 3.7, will continue in
full force and effect following the Closing Date.
3.8 TAXES.
(a) The Company and the Subsidiaries have filed or
caused to be filed (or will have filed or caused to be filed) all material
federal, state, foreign and local tax returns, tax information returns,
reports, and estimates ("RETURNS"), for all taxable or reporting periods
ending on or before the Closing Date (taking into account applicable
extension periods) to the extent required to be filed by the Company and the
Subsidiaries under applicable federal, foreign, state or local law on or
before the Closing Date; all Taxes due have been paid in full when due and
the Company and each of the Subsidiaries has established adequate reserves in
accordance with
10
GAAP on the books and records and on the financial statements of the Company
and the Subsidiaries for all Taxes not yet due and payable; all Returns are
complete and accurate in all material respects; and there are no liens on any
of the assets of the Company or any Subsidiary that arose in connection with
any failure (or alleged failure) to pay any Tax. As used in this Agreement,
"TAXES" or "TAX" means all foreign, federal, state and local taxes of any
kind, including, without limitation, income, capital gains, gross receipts,
franchise, employment, sales, use, license, property or withholding taxes and
any interest or penalties related thereto, validly imposed upon the Company
and the Subsidiaries with respect to such taxes.
(b) As of the date hereof: (i) all deficiencies or
assessments relating to Taxes have been paid in full; (ii) no waivers of
statutes of limitation and no extensions of time have been given or requested
with respect to any payments of Taxes by the Company and the Subsidiaries;
(iii) no closing agreements, private letter rulings, technical advice
memoranda or similar agreements or rulings have been entered into or issued
by any taxing authority with respect to the Company or the Subsidiaries; and
(iv) no proceedings before any Governmental Body are presently pending with
regard to any Taxes or Returns and neither the Company nor the Subsidiaries
have received any written notices of such audits or proceedings.
(c) Neither the Company nor any Subsidiary is a United
States Real Property Holding Corporation (a "USRPHC") within the meaning of
Section 897 of the Code nor was any of the Company or any Subsidiary a USRPHC
on any "determination date" (as defined in Section 1.897-2(c) of the
regulations promulgated by the Treasury Department pursuant to the Code (the
"TREASURY REGULATIONS")) that occurred in the five-year or shorter applicable
period preceding the Closing Date.
3.9 GOVERNMENTAL PERMITS. The Company and each
Subsidiary own, hold or possess all governmental licenses, permits,
privileges, immunities, approvals and other authorizations which are
necessary for the ownership, leasing, operation and use of its assets or
which are required for the conduct of its business as currently conducted
(the "GOVERNMENTAL PERMITS"), except where the failure to own, hold or
possess the same have not had and would not have a Material Adverse Effect.
Each Governmental Permit is valid and in full force and effect and, to the
knowledge of the Company, no suspension or cancellation of any Governmental
Permit is threatened, except in each case as have not had and would not have
a Material Adverse Effect.
3.10 OWNERSHIP OF PROPERTY.
(a) SCHEDULE 3.10 sets forth as of the date hereof (i)
an accurate and complete list of all real property that the Company or any
Subsidiary owns, or in which the Company or any Subsidiary has legal,
beneficial or equitable title (the "OWNED REAL PROPERTY"); (ii) an accurate
and complete list of all real property with respect to which the Company or
any Subsidiary is a lessee, sublessee, licensee or other occupant or user
(the "LEASED REAL PROPERTY"); and (iii) an accurate and complete list of each
lease, sublease, license or other agreement, oral or written, pursuant to
which any party other than the Company or a Subsidiary occupies or uses all
or any part of the Owned Real Property or the Leased Real Property. The Owned
Real Property and the Leased Real Property are sometimes collectively
referred to herein as the "REAL PROPERTY". Except as set forth in SCHEDULE
3.10, neither the Company nor any Subsidiary is in
11
breach or default under any of the Property Leases nor, to the knowledge of
the Company, is any other party to any of the Property Leases in default
thereunder; excluding in each case breaches or defaults which have not had
and would not have a Material Adverse Effect.
(b) The Company and the Subsidiaries have good (and,
in the case of Owned Real Property, marketable) title (or leasehold interest
with respect to Leased Real Property) to all assets which are necessary to
the conduct of the business of the Company and the Subsidiaries taken as a
whole, except for inventory sold, consumed or otherwise disposed of in the
ordinary course of business since December 31, 2000, free and clear of all
Encumbrances, except (i) as set forth in SCHEDULE 3.10, (ii) for liens for
taxes not yet due and payable or being contested in good faith by appropriate
proceedings, (iii) for liens of carriers, warehousemen, mechanics,
materialmen and other similar liens incurred in the ordinary course of
business that do not individually or in the aggregate have a Material Adverse
Effect, and (iv) for lack of title and other Encumbrances which do not have a
Material Adverse Effect (the matters set forth in the foregoing clauses (i),
(ii), (iii) and (iv) as well as any Encumbrances arising from the Senior
Credit Agreement are referred to herein as "PERMITTED ENCUMBRANCES").
(c) There are no pending or, to the knowledge of the
Company, threatened condemnation proceedings, lawsuits, or administrative
actions relating to the Real Property, or other matters which would adversely
affect the use, occupancy or value thereto, except as have not had and would
not have a Material Adverse Effect.
(d) The buildings and improvements located on the
Owned Real Property are within the boundary lines of the described parcels of
land except as have not had and would not have a Material Adverse Effect.
(e) Each facility located on any Real Property is
supplied with utilities and other services necessary for the operation of
such facility and are provided via public roads or via appurtenant easements,
each such facility abuts on and has vehicular access to a public road, or has
access to a public road via an easement, except in each case as have not had
and would not have a Material Adverse Effect.
(f) Each Property Lease is in full force and effect
and, except as set forth in SCHEDULE 3.4, none of the Company or its
Subsidiaries has assigned, transferred, conveyed, mortgaged, deeded in trust,
or encumbered any interest in the Leased Real Property, except in each case
as have not had and would not have a Material Adverse Effect.
3.11 INTELLECTUAL PROPERTY.
(a) SCHEDULE 3.11 contains a complete and correct list
of each patent, patent application, registered trademark, trademark
application, registered service xxxx, service xxxx application, trade name,
trade secret or copyright owned by, used by, or licensed for use by any of
the Company or the Subsidiaries (together with other intellectual property
rights owned by, used by or licensed for use by any of the Company or the
Subsidiaries and that is material to the business of the Company and the
Subsidiaries, taken as a whole, the "COMPANY INTELLECTUAL PROPERTY").
12
(b) Except as set forth in SCHEDULE 3.11:
(i) each item of Company Intellectual Property has
been duly maintained and is valid and subsisting;
(ii) no material claim has been made, is currently
pending or, to the Company's knowledge, is threatened against
the Company or any Subsidiary contesting the validity,
enforceability, use or ownership of any item of Company
Intellectual Property, or otherwise claiming that the Company
or any Subsidiary has infringed or is infringing any patent,
trademark, service xxxx, tradename, copyright or other
intellectual property right of any third party, or claiming
that the Company or any Subsidiary has misappropriated any
trade secret or other intellectual property of any third
party; and
(iii) within the last six years, no third party has,
to the Company's knowledge, misappropriated, diluted or
infringed any item of Company Intellectual Property.
(c) The Company or applicable Subsidiary owns, or has
a valid right to use (in substantially the manner as presently used by such
entity), free and clear of all material encumbrances, restrictions or
limitations, the Company Intellectual Property.
(d) Complete and correct copies of all material
contracts, agreements and licenses relating to any of the Company's or the
Subsidiaries' rights in the Company Intellectual Property have been made
available to Purchaser by the Company. Each such contract, agreement or
license is in full force and effect and neither the Company nor any
Subsidiary is in breach of or default under any such contract, agreement, or
license, except for breaches and defaults which have not had and would not
have a Material Adverse Effect.
(e) Each item of Company Intellectual Property (other
than Company Intellectual Property licensed for use by any of the Company or
the Subsidiaries) was developed either (a) by employees of the Company or one
of its Subsidiaries within the scope of their employment; (b) by independent
contractors as "works-made-for-hire," as that term is defined under Section
101 of the United States Copyright Act, 17 U.S.C. Section 101, pursuant to
written agreement; or (c) by third parties who have assigned, licensed or
otherwise transferred their rights therein to the Company or relevant
Subsidiary pursuant to a written agreement. No former or present employees,
officers or directors of the Company or any Subsidiary retain any rights of
ownership or use of any item of Company Intellectual Property, and no
employees or third parties who have developed or participated in the
development of any item of the Company Intellectual Property have any rights
therein.
3.12 LABOR RELATIONS. There are no pending labor
grievances or unfair labor practice claims or charges against the Company or
any Subsidiary which have had or would have a Material Adverse Effect. To the
knowledge of the Company, there are no nor in the past five years have there
been any organizing efforts by any union or other group seeking to represent
any material number of employees of the Company or any Subsidiary, nor is
there any pending decertification proceeding, except for such efforts and
proceedings which have not been and
13
would not be reasonably likely to be material to the Company and the
Subsidiaries taken as a whole.
3.13 EMPLOYEE BENEFIT PLANS.
(a) For purposes hereof, the term "EMPLOYEE PLAN"
means any pension, retirement, profit-sharing, deferred compensation, stock
purchase, stock option, bonus or incentive plan, any medical, vision, dental
or other health plan, any life insurance plan, vacation, severance,
disability or other employee benefit plan, program, policy, or arrangement,
whether written or unwritten, including, without limitation, any "EMPLOYEE
BENEFIT PLAN" as defined in Section 3(3) of ERISA which the Company or any of
its Subsidiaries maintains or contributes to or for which the Company or any
of its Subsidiaries has any liability. Neither the Company nor any Subsidiary
sponsors, maintains, contributes to or has any contingent or other liability
with respect to any Employee Plan which is a defined benefit plan as defined
in Section 3(35) of ERISA and which is qualified under Section 401(a) of the
Code (a "DEFINED BENEFIT PLAN") or any multiemployer plan within the meaning
of Section 3(37) or Section 4001(3)of ERISA (a "MULTIEMPLOYER PLAN"). With
respect to each Employee Plan, there has been provided or made available a
current, accurate and complete copy (or, to the extent no such copy exists,
an accurate description) thereof and, to the extent applicable, (i) any
related trust agreement, annuity contract or other funding instrument; (ii)
any summary plan description, (iii) the most recent annual Form 5500 (if
applicable) with respect to such Company Plans and (iv) if such Employee Plan
is intended to be a qualified single employer plan under section 401(a) of
the Code, the most recent favorable determination letter received from the
Internal Revenue Service and if a determination letter request is pending, a
copy of such request. There has been no act or omission that would impair the
ability of the Company to unilaterally amend or terminate any Plan, subject
to the terms thereof, without material liability to the Company.
(b) As of the date hereof:
(i) Each of the Employee Plans that purports to be
qualified under Section 401(a) of the Code and any trust under any such
Employee Plan that purports to be exempt from income tax under Section
501(a) of the Code has received one or more favorable determination
letters from the IRS to such effect or there is currently pending a
request for such determination letter, or the deadline for filing a
request for such determination letter has not yet expired. To the
knowledge of the Company, each Employee Plan intended to be qualified
under Section 401 of the Code has been administered in all material
respects according to its terms, and to the knowledge of the Company
nothing has occurred which would be reasonably likely to adversely
affect its qualified status or the qualified status of any related
trust. The Employee Plans are and all times have been in compliance in
all material respects with all other laws (including without
limitation, ERISA and the Code) applicable to Employee Plans. Except as
set forth in SCHEDULE 3.13, all material reports and material
disclosures relating to the Employee Plans required to be filed with or
furnished to any Governmental Body have been filed or furnished in a
timely manner and in accordance with applicable law.
(ii) With respect to any Employee Plan, no prohibited
transaction (within the meaning of Section 406 of ERISA and/or Section
4975 of the Code) exists
14
which could subject the Company or any of the Subsidiaries or any
"disqualified person" to any material excise tax or penalty pursuant to
Section 502(1) of ERISA or under Section 4975 of the Code, except in
each case as have not had and would not have a Material Adverse Effect.
(iii) In the last six years neither the Company nor
any Subsidiary has sponsored, maintained or had any obligation with
respect to any Defined Benefit Plan or Multiemployer Plan.
(c) The Company and each of the Subsidiaries have made full
and timely payment of all amounts which are required to be paid as
contributions to each Employee Plan that is an employee pension benefit plan
(as defined in Section 3(2) of ERISA). There are no material unpaid
contributions due prior to the date hereof with respect to any Employee Plan
that are required to have been made under the term of such Employee Plan.
(d) Each of the Company and the Subsidiaries has complied
in all material respects with the continuation coverage requirements of Part
6 of Title I of ERISA, as amended.
(e) Assuming that the shareholder approval requirements of
Code Section 280G are satisfied, neither the Company nor any Subsidiary will
be obligated as a result, directly or indirectly, of the transactions
contemplated by this Agreement (including, without limitation, as a result of
any termination of employment prior to or following the Closing Date) to make
a payment that would be characterized as an "excess parachute payment" to an
individual who is a "disqualified individual" (as such terms are defined in
Section 280G of the Code).
(f) With respect to any Employee Plan, except as set forth
in SCHEDULE 3.13: (i) no filing, application or other material matter is
pending with any Governmental Body and (ii) there are no outstanding material
liabilities for taxes, penalties or fees.
(g) With respect to any Employee Plan, there is no material
liability, contingent or otherwise, under any insurance policy with respect
to any Employee Benefit Plan for a retroactive rate adjustment or
loss-sharing or similar arrangement.
(h) Except as set forth in SCHEDULE 3.13, the Company has
no material liability or material contingent liability for providing, under
any Employee Plan or otherwise, any post-retirement medical or life insurance
benefits or other welfare benefits, other than statutory liability for
providing group health plan continuation coverage under Part 6 of Title I of
ERISA and Section 4980B of the Code.
(i) Except as set forth in SCHEDULE 3.13, no Employee Plan
provides material benefits to any individual who is not a current or former
employee of the Company, or the dependents or other beneficiaries of any such
current or former employee.
(j) There are no pending, or to the knowledge of the
Company, threatened material claims or controversies with respect to any
Employee Plan, other than routine claims for benefits in the ordinary course
of business.
15
(k) Except as set forth in SCHEDULE 3.13, the Company has
not agreed (i) to create or incur material liability with respect to, or to
cause to exist any Employee Benefit Plan, program or arrangement (other than
the Employee Plans), (ii) to enter into any material contract or agreement to
provide compensation or benefits to any individual (other than the Employee
Plans), or (iii) to modify, change or terminate any Employee Plan, except as
may be required by applicable law.
3.14 CERTAIN CONTRACTS.
(a) Except as set forth in SCHEDULE 3.14, as of the date
hereof, neither the Company nor any Subsidiary is a party to, or is bound by:
(i) any agreement, contract or other commitment
outside of the ordinary course of business involving payments by or to
the Company or any Subsidiary of more than $1,000,000 in any 12-month
period;
(ii) any severance agreement or contract for the
employment of any officer or employee (other than any contract which is
terminable without liability upon notice of 180 days or less), or any
severance agreement or contract of employment with a former officer,
director or employee, pursuant to which, in any case, payments in
excess of $50,000 in any 12-month period are required to be made by the
Company or any Subsidiary after the date hereof;
(iii) any contract or obligation relating to any
outstanding indebtedness for borrowed money by the Company or any
Subsidiary, other than borrowings less than $1,000,000 in the
aggregate;
(iv) except for guarantees of obligations between or
among the Company and the Subsidiaries, any guarantee or other
contingent liability in respect of any indebtedness or obligation of
any Person outside of the ordinary course of business;
(v) any collective bargaining agreement;
(vi) any agreement which obligates the Company or any
Subsidiary not to compete with any business or which otherwise
restrains or prevents the Company or any of the Subsidiaries from
carrying on any lawful business (excluding customary restrictive
covenants contained in agreements previously provided to Purchaser); or
(vii) any sales, marketing or distribution agreements
generating revenues or expenditures in excess of $500,000.
(b) Complete and correct copies of all contracts,
agreements and other instruments referred to in SCHEDULE 3.14 have been made
available to Purchaser by the Company, except to the extent that disclosure
of any of the foregoing is restricted by applicable confidentiality
agreements.
(c) Except as disclosed in SCHEDULE 3.14, all contracts,
agreements and other instruments referred to in SCHEDULE 3.14 are in full
force and effect and neither the Company nor
16
any Subsidiary, nor, to the knowledge of the Company any third party
including any employee of the Company or its Subsidiaries, is in breach of or
default under any such contract, agreement or instrument or, to the knowledge
of the Company, under any non-competition agreement with any third party,
except for breaches and defaults which have not had and would not have a
Material Adverse Effect.
3.15 COMPLIANCE WITH LAW. Except as set forth in SCHEDULE
3.15, the Company and the Subsidiaries have complied in the conduct of their
businesses with all Laws, except failures to comply which have not had and
would not have a Material Adverse Effect.
3.16 ENVIRONMENTAL MATTERS.
(a) Except as set forth in SCHEDULE 3.16, (i) neither the
Company nor any Subsidiary is subject to any compliance order, consent
decree, notice, demand, enforcement proceeding or injunction issued or
initiated by any Governmental Body relating to any Environmental Law, (ii)
neither the Company nor any Subsidiary has been notified in writing that it
may be a responsible party or potentially responsible party under or in
violation of or noncompliance with any Environmental Law and (iii) there are
no events or facts known to the Company that indicate that the Company or any
Subsidiary is or will be such a responsible party or potentially responsible
party or will be in violation of or not in compliance with any Environmental
Law, except in each case for such matters as have not had and would not have
a Material Adverse Effect.
(b) Except as has not had and would not have a Material
Adverse Effect, to the knowledge of the Company: (i) no real property
currently or formerly owned, leased or operated by the Company or any
Subsidiary is contaminated with any Hazardous Substance and (ii) there are no
other circumstances or conditions involving the Company or any Subsidiary
that have resulted or are likely to result in any liability on the part of
the Company or any Subsidiary relating to or arising under any Environmental
Law.
3.17 LITIGATION. Except as set forth in SCHEDULE 3.17,
there is no action, suit, proceeding or investigation pending or, to the
Company's knowledge, threatened against the Company or any Subsidiary which
would be reasonably likely to be material to the Company and the Subsidiaries
taken as a whole. To the knowledge of the Company, neither the Company nor
any Subsidiary is in default in respect of any judgment, order, writ,
injunction or decree of any court or any Governmental Body which would be
reasonably likely to be material to the Company and the Subsidiaries taken as
a whole. There is no action, suit, investigation or proceeding pending, or to
the Company's knowledge, threatened involving the Company or any of the
Subsidiaries which would be reasonably likely to have a Material Adverse
Effect on the ability of the Company to perform its obligations hereunder, or
which seeks to enjoin or obtain damages in respect of the consummation of the
transactions contemplated hereby.
3.18 FINDERS. Neither the Company nor any Subsidiary is
obligated to pay any fee or commission to any broker, finder or similar
intermediary for or on account of the transactions contemplated by this
Agreement, except that the Company is obligated to pay upon consummation of
the transactions contemplated hereby, a fee to Xxxxxxx, Xxxxx & Co. who has
been retained by the Company to serve as financial advisor.
17
3.19 THIRD-PARTY CONSENTS. Except as set forth in SCHEDULE
3.4 or SCHEDULE 3.19, the Company has received all consents, authorizations
and approvals from non-governmental third parties which are necessary in
order to enable (a) Purchaser to consummate the transactions contemplated
hereby and (b) the Company and the Subsidiaries to conduct their businesses
after the Closing Date on the same basis as conducted prior to the date
hereof (except with respect to clauses (a) and (b) for the failure to obtain
any consents, approvals, authorizations, exemptions and waivers the failure
of which to obtain would not, in the aggregate, result in a Material Adverse
Effect).
3.20 UNDISCLOSED LIABILITIES. Except as set forth in any
SEC Filing and except as disclosed in SCHEDULE 3.20, as of December 31, 2000,
neither the Company nor any Subsidiary had, and since such date neither the
Company nor any Subsidiary has incurred, any material liabilities or material
obligations of any nature (whether accrued, absolute, contingent or
otherwise) which, individually or in the aggregate, would be required to be
disclosed in a balance sheet (or the footnotes thereto) of the Company
prepared in accordance with GAAP except liabilities incurred in the ordinary
and usual course of business and consistent with past practice, and
liabilities incurred in connection with the performance of this Agreement.
3.21 DISCLOSURE. None of this Agreement (including, without
limitations, the Schedules hereto), or any certificate furnished or to be
furnished by or on behalf of the Company or the Sellers, contains or will
contain an untrue statement of material fact. This Agreement (including the
Schedules hereto), does not, considered as a whole, omit to state a material
fact necessary in order to make the statements contained herein in light of
the circumstances in which they are made not misleading.
3.22 CUSTOMERS. Except as set forth in SCHEDULE 3.22 or as
would not have a Material Adverse Effect, as of the date hereof none of the
Company's top twenty customers (by revenue) has given written notice that
such customer will cease to purchase products or services or reduce
significantly the amount of products and services purchased from the Company,
or modify in any manner adverse to the Company its relationship with the
Company.
3.23 SUPPLIERS. Except as set forth in SCHEDULE 3.23 or as
would not have a Material Adverse Effect, as of the date hereof none of the
Company's top twenty suppliers (by dollar amount purchased) has given written
notice that such supplier will cease to supply products or services or reduce
significantly the amount of products supplied to the Company, or modify in
any manner adverse to the Company its relationship with the Company.
3.24 BOOKS AND RECORDS. The books and all corporate
(including minute books and stock record books) and financial records of the
Company and its Subsidiaries are complete and correct and have been
maintained in accordance with applicable sound business practices, laws and
other requirements, except as would not have a Material Adverse Effect.
3.25 NO ILLEGAL PAYMENTS. None of the Sellers, the Company
or any Subsidiary, nor any of their directors, officers, employees or agents,
has (a) directly or indirectly given or agreed to give any illegal gift,
contribution, payment or similar benefit to any supplier, customer,
governmental official or employee or other person who was, is or may be in a
position to help or hinder the Company or any Subsidiary (or assist in
connection with any actual or
18
proposed transaction) or made or agreed to make any illegal contribution, or
reimbursed any illegal political gift or contribution made by any other
person, to any candidate for federal, state, local or foreign public office
(i) which might subject any of the Company and any Subsidiary to any damage
or penalty in any civil, criminal or governmental litigation or proceeding
which was material or could reasonably be expected to be material to the
Company and the Subsidiaries, taken as a whole or (ii) the non-continuation
of which was material or could reasonably be expected to be material to the
Company and the Subsidiaries, taken as a whole or (b) established or
maintained any unrecorded fund or asset or made any false entries on any
books or records for any purpose which was material or could reasonably be
expected to be material to the Company and the Subsidiaries, taken as a whole.
3.26 TRANSACTIONS WITH AFFILIATES. Except as set forth in
SCHEDULE 3.26, neither the Company nor any of its Subsidiaries is a party to
or bound by any contract, commitment or understanding (other than contracts,
commitments or understandings between or among the Company and its
Subsidiaries) with any of the stockholders, directors or officers (except for
the employment and related agreements listed in SCHEDULE 3.14) of Seller or
any of its affiliates or any member of their respective families or with any
of the directors or officers of the Company or any of its Subsidiaries or any
member or their respective families, and neither Seller nor any of its
affiliates nor any of the stockholders, directors or officers of the Seller
or any of its affiliates or the members of their respective families or any
of the directors or officers of the Company or any of its Subsidiaries or any
member of their respective families owns or otherwise has any right to or
interest in any asset, tangible or intangible, which is used in the Company's
business.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE SELLERS
Each Seller severally (as to such Seller and not as to any
other Seller) represents and warrants to Purchaser as follows:
4.1 AUTHORITY AND RELATED MATTERS.
(a) Such Seller has full legal right, power, capacity and
authority to execute and deliver this Agreement and to perform such Seller's
obligations hereunder. This Agreement is the legal, valid and binding
obligation of such Seller in accordance with its terms (except to the extent
that enforceability may be limited by bankruptcy, insolvency, reorganization,
moratorium or other similar laws relating to creditors' rights generally or
by general principles of equity and public policy).
(b) Such Seller is the owner of the number of Shares listed
beside such Seller's name on EXHIBIT A. As of the Closing Date, the Shares to
be sold to Purchaser by such Seller will be transferred to Purchaser free and
clear of all Encumbrances.
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(c) Except as set forth in SCHEDULE 4.1, the execution and
delivery by such Seller of this Agreement and the consummation by such Seller
of any of the transactions contemplated hereby will not:
(i) violate, conflict with, result in a breach of or
constitute a default under any articles of organization, bylaws, trust
agreement, partnership agreement or certificate of partnership or other
organizational documents of the Seller, or, except as would not prevent
or delay the consummation of the transactions contemplated hereby, any
note, instrument, agreement, mortgage, lease, license, franchise,
Governmental Permit or judgment, order, award or decree to which such
Seller is a party or by which the Seller is bound, or any Law affecting
such Seller; or
(ii) require the approval, consent, authorization or
act of, or the making by such Seller of any declaration, filing or
registration with, any Governmental Body.
4.2 NO FINDER. Such Seller has not made any arrangement
which would obligate Purchaser, the Company or the Subsidiaries to pay any
fee or commission (or reimburse expenses) to any broker, finder or similar
intermediary for or on account of the transactions contemplated by this
Agreement.
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF PURCHASER
Purchaser represents and warrants to the Company and each
Seller as follows:
5.1 ORGANIZATION OF PURCHASER. Purchaser is a limited
liability company duly organized, legally existing and in good standing under
the laws of Delaware and has full limited liability company power and
authority to own or lease and to operate and use its properties and assets
and to carry on its business as now conducted. Prior to the date hereof, true
and complete copies of the certificate of formation and operating agreement
of Purchaser have been delivered to the Company, and such documents have not
been amended to date.
5.2 AUTHORITY OF PURCHASER.
(a) Purchaser has the requisite power and authority to
execute and deliver this Agreement, to consummate the transactions
contemplated hereby and to perform its obligations hereunder. The execution,
delivery and performance of this Agreement by Purchaser have been duly
authorized and approved by all necessary limited liability company action on
behalf of Purchaser and do not require any further authorization or consent
of Purchaser or its or equity holders. This Agreement is the legal, valid and
binding obligation of Purchaser enforceable against Purchaser in accordance
with its terms (except to the extent that enforceability may be limited by
bankruptcy, insolvency, reorganization, moratorium or other similar laws
relating to creditors' rights generally or by general principles of equity
and public policy).
(b) Neither the execution and delivery of this Agreement by
Purchaser, the consummation by Purchaser of any of the transactions
contemplated hereby nor performance by Purchaser of its obligations hereunder
will violate, conflict with or result in a breach of the terms,
20
conditions or provisions of, or constitute a default, an event of default or
an event creating rights of acceleration, termination or cancellation or a
loss of rights under the charter, bylaws, trust agreement, partnership
agreement, operating agreement, certificate of formation, or certificate of
partnership or other constitutive documents of Purchaser, or any note,
instrument, agreement, mortgage, lease, license, franchise, Governmental
Permit or judgment, order, award or decree to which Purchaser is a party, to
which any of its properties is subject or by which Purchaser is bound, except
as would not prevent or delay consummation of the transactions contemplated
hereby.
5.3 NO FINDER. Neither Purchaser nor any party acting on
its behalf has paid or become obligated to pay any fee or commission to any
broker, finder or intermediary for or on account of the transactions
contemplated by this Agreement.
5.4 ABSENCE OF PROCEEDINGS. There is no action, suit,
proceeding or investigation pending or, to the knowledge of Purchaser,
threatened, against Purchaser which might materially and adversely affect or
restrict Purchaser's ability to consummate the transactions contemplated by
this Agreement.
5.5 INVESTMENT INTENT. Purchaser is purchasing the Shares
hereunder solely for its own account and with no intention of distributing or
reselling the Shares or any part thereof, or interest therein, in any
transaction that would be in violation of the Securities Act or any other
securities laws of the United States of America or any state thereof.
5.6 STATUS AS ACCREDITED INVESTOR. Purchaser is an
"accredited investor" (as that term is defined in Rule 501 of Regulation D
under the Securities Act). Purchaser has such knowledge and experience in
business and financial matters so that Purchaser is capable of evaluating the
merits and risks of an investment in the Shares. Purchaser understands the
full nature and risk of an investment in the Shares. Purchaser further
acknowledges that it has had access to the books and records of the Company
and the Subsidiaries, is generally familiar with the business being conducted
by the Company and the Subsidiaries and has had an opportunity to ask
questions concerning the Company and the Subsidiaries.
5.7 FINANCIAL CAPABILITY. Assuming the conditions to
funding by Xxxxxxx Sachs have been satisfied (or waived) pursuant to the
Xxxxxxx Xxxxx financing letters attached hereto as EXHIBIT C, which include a
commitment letter relating to a bridge loan facility (the "Bridge Facility"),
Purchaser has, or has available to it, adequate funds to meet its obligations
under this Agreement.
5.8 NO OUTSIDE RELIANCE. Purchaser has not relied and is
not relying upon any statement or representation not made in this Agreement
or any Schedule hereto or any certificate or document required to be provided
by the Company or any of the Sellers pursuant to this Agreement.
5.9 GOVERNMENTAL CONSENTS. No consent, approval or
authorization of, or declaration, filing or registration with, any
Governmental Body (other than such as are required pursuant to the H-S-R Act
or any foreign pre-merger notification or anti-competition statute) is
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required to be made or obtained by Purchaser in connection with the
execution, delivery and performance of this Agreement.
ARTICLE VI
ADDITIONAL COVENANTS
6.1 INVESTIGATION BY PURCHASER. From the date hereof until
Closing or termination of this Agreement pursuant to Article IX hereof, the
Company shall afford to the officers and authorized representatives of
Purchaser (including, without limitation, independent public accountants and
attorneys) and to the employees and authorized representatives of Purchaser's
financing sources, reasonable access during normal business hours to the
offices, properties, senior management and business and financial records of
the Company and the Subsidiaries to the extent Purchaser shall reasonably
consider necessary, and shall furnish to Purchaser or its authorized
representatives such additional information concerning the Company and the
Subsidiaries and their properties, assets, businesses and operations as shall
be reasonably requested. Purchaser covenants that such investigation shall be
conducted in such a manner as not to (a) interfere unreasonably with the
operations of the Company and the Subsidiaries or (b) delay the Closing.
Nothing in this Section shall be interpreted so as to grant Purchaser the
right to perform invasive or subsurface investigations of the properties or
locations of the Company or the Subsidiaries.
6.2 CONFIDENTIALITY. Any information provided to Purchaser
or its representatives and any information provided to the Company, the
Subsidiaries or the Sellers or their respective representatives pursuant to
this Agreement shall be held by each party and its representatives in
accordance with, and shall be subject to the terms of, the Confidentiality
Agreement dated April 12, 2001 by and between an affiliate of Purchaser and
TWCC (the "Confidentiality Agreement").
6.3 CERTAIN AGREEMENTS. Each of the parties hereto shall
use such party's best efforts to consummate the transactions contemplated by
this Agreement. Each party shall promptly notify the others of any action,
suit or proceeding that shall be instituted or threatened against such party
to restrain, prohibit, otherwise challenge the legality of or delay the
transactions contemplated by this Agreement.
6.4 OPERATIONS PRIOR TO THE CLOSING DATE.
(a) Subject to Section 6.4(b) hereof or expressly
contemplated by this Agreement, from the date hereof through the Closing
Date, the Company and the Subsidiaries taken as a whole shall operate and
carry on their businesses only in the ordinary course. In furtherance and not
in limitation of the foregoing, the Company shall use commercially reasonable
efforts consistent with good business practice to (i) keep and maintain the
assets and properties of the Company and the Subsidiaries in normal operating
condition and repair, (ii) maintain the business organization of the Company
and the Subsidiaries, as a whole, intact and (iii) preserve the goodwill of
the suppliers, employees, customers and others having business relations with
the Company and the Subsidiaries.
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(b) Except as expressly contemplated by this Agreement or
as set forth in SCHEDULE 6.4, neither the Company nor any Subsidiary shall
without the express prior written approval of Purchaser (which shall not be
unreasonably withheld):
(i) amend its articles of organization or bylaws
or the Certificate of Designations;
(ii) issue, transfer, sell or deliver any shares of
its capital stock (or options or other securities convertible into or
exchangeable or exercisable for, with or without additional
consideration, such capital stock) or any other interest therein,
except (A) in connection with the exercise of Company Options granted
prior to the date hereof pursuant to the Company Option Plan or (B) in
connection with the issuance of any Company Options surrendered or any
Shares repurchased after the date hereof and prior to the Closing as
determined by the Board of Directors of the Company (provided that such
issuances shall not result in an increase in the aggregate
consideration payable pursuant to Article II hereof based on the
accuracy of the representations and warranties set forth in Section 3.2
hereof);
(iii) split, combine or reclassify any shares of its
capital stock or declare, set aside or pay any dividends or make any
other distributions (whether in cash, stock or other property) in
respect of such shares, except for dividends and distributions payable
by a Subsidiary to another Subsidiary or to the Company;
(iv) redeem, purchase or otherwise acquire for any
consideration (A) any outstanding shares of its capital stock or
securities carrying the right to acquire or which are convertible into
or exchangeable or exercisable for, with or without additional
consideration, such capital stock, (B) any other securities of the
Company or any Subsidiary, or (C) any interest in any of the foregoing,
except as contemplated by this Agreement and the redemption or
repurchase of shares of Class C Stock from employees in connection with
the termination of such employee's employment;
(v) incur any indebtedness for borrowed money, except
borrowings in the ordinary course of business under the revolving
portion of the Senior Credit Agreement consistent with the Company's
historical practice and the budget provided to Purchaser;
(vi) make any acquisition or disposition of stock or
other securities or assets of any Person or materially increase
inventory levels of the Company or any Subsidiary except acquisitions
or dispositions of inventory and equipment in the ordinary course of
business consistent with past practice and the budget provided to
Purchaser;
(vii) incur capital expenditures materially in excess
of those contemplated by the budget previously provided to Purchaser by
the Company or defer or cancel any such material contemplated
expenditures;
(viii) merge or consolidate with any corporation or
other entity;
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(ix) enter into any employment or similar contract
with, or materially increase the compensation payable to, any officer,
director or employee except in the ordinary course of business and not
to exceed annual compensation in excess of $200,000 for any individual;
(x) alter in any material respect its historical
practices and policies relating to the payment and collection of
accounts payable and accounts receivable as reflected in the budget
previously provided to Purchaser;
(xi) except as contemplated by or described in this
Agreement, adopt, amend in any material respect or terminate any
Employee Plan, severance plan or collective bargaining agreement or
make awards or distributions under any Employee Plan, except awards or
distributions to any participant or employee in the ordinary course,
not to exceed $50,000 in the aggregate;
(xii) create, assume or suffer to be incurred any
Encumbrance of any kind on any of its properties or assets other than
Permitted Encumbrances excluding from the definition of Permitted
Encumbrances for purposes of this clause (xii) only, liens securing
indebtedness for borrowed money except any such liens created pursuant
to the Senior Credit Agreement;
(xiii) amend, supplement or modify any agreement
material to the Company and its Subsidiaries taken as a whole except in
the ordinary course of business;
(xiv) make any payment of principal or interest on
the Notes, under the Senior Credit Agreement, or under any other
indebtedness of the Company or its Subsidiaries other than: (a) as
required by the terms and as set forth in SCHEDULE 6.4 and (ii) on the
revolving loans under the Senior Credit Agreement; or
(xv) commit to do any of the foregoing.
6.5 NO PUBLIC ANNOUNCEMENT; CONFIDENTIALITY. Prior to the
Closing Date, none of Purchaser, the Company, or any Seller shall, without
the approval of Purchaser and the Company (which shall not be unreasonably
withheld), make any press release or other public announcement concerning the
transactions contemplated by this Agreement, except as and to the extent that
any such party shall be so obligated by law, in which case Purchaser and the
Company shall be advised, and Purchaser and the Company shall use their
reasonable efforts to cause mutually acceptable releases or announcements to
be issued. On the date hereof and on the Closing Date, the parties shall
issue press release(s) which shall be reasonably acceptable to both the
Company and Purchaser. Nothing in this Section 6.5 shall be deemed to prevent
Purchaser from making customary announcements necessary to obtain its
financing. Except pursuant to confidentiality agreements that are in
substance similar to the Confidentiality Agreement, neither the Company nor
any Seller shall provide to any third party any non-public information
regarding the Company in connection with such third parties' consideration of
a merger, sale of assets, sale of Shares or similar transactions involving
the Company.
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6.6 GOVERNMENTAL FILINGS; CONSENTS.
(a) The Sellers, the Company and Purchaser shall cooperate
with each other in filing any necessary applications, reports or other
documents with any Governmental Body having jurisdiction with respect to the
transactions contemplated hereby, and in seeking necessary consultation with
and prompt favorable action by, including required consents of, any such
Governmental Body.
(b) Each of the parties hereto shall (i) promptly make or
cause to be made the filings required of such party under the H-S-R Act with
respect to the transactions contemplated by this Agreement, (ii) comply at
the earliest practicable date with any request under the H-S-R Act for
additional information, documents or other material received by such party or
any of its affiliates or subsidiaries from the Federal Trade Commission or
the Department of Justice or other Governmental Body in respect of such
filings, and (iii) cooperate with the other parties in connection with any
such filing and in connection with resolving any investigation or other
inquiry of any such agency or other Governmental Body under the H-S-R Act
with respect to any such filing and the transactions contemplated by this
Agreement. Each party shall promptly inform the other parties of any material
communication with, and any proposed understanding, undertaking, or agreement
with, any Governmental Body regarding any such filing. None of the parties
shall participate in any meeting with any Governmental Body in respect of any
such filing, investigation or other inquiry without giving each other party
notice of the meeting and, to the extent permitted by such Governmental Body,
the opportunity to attend and participate.
(c) Each of the Sellers, the Company and Purchaser shall
use commercially reasonable efforts to resolve such objections, if any, as
may be asserted by any Governmental Body with respect to the transactions
contemplated by this Agreement. In connection therewith, if any
administrative or judicial action or proceeding is instituted (or threatened
to be instituted) challenging the transactions contemplated by this
Agreement, and if, by mutual agreement, the Sellers, the Company and
Purchaser decide that litigation is in their best interests, each party shall
cooperate and use commercially reasonable efforts vigorously to contest and
resist any such action or proceeding and to have vacated, lifted, reversed,
or overturned any order that is in effect and that prohibits, prevents, or
restricts consummation of the transactions contemplated by this Agreement.
Each party hereto shall use commercially reasonable efforts to take such
action as may be required to cause the expiration of the notice period under
the H-S-R Act with respect to the transactions contemplated hereby as
promptly as possible after the execution of this Agreement.
6.7 DIRECTORS' AND OFFICERS' INDEMNIFICATION.
(a) Purchaser covenants for itself and its successors and
assigns, that they shall not institute any action or proceeding in any court
or before any administrative agency or before any other tribunal against any
of the current directors of the Company and the Subsidiaries, in their
capacity as such, with respect to any liabilities, actions or causes of
action, judgments, claims or demands of any nature or description
(consequential, compensatory, punitive or otherwise), in each such case to
the extent resulting from their approval of this Agreement or the
transactions contemplated hereby.
25
(b) The Company shall not take any action directly or
indirectly to disaffirm or adversely affect the provisions of the articles of
organization and bylaws and any other written agreements of the Company and
the Subsidiaries that provide indemnification of and expense reimbursement to
any person who is now, or has been at any time prior to the date hereof or
who becomes prior to the Closing Date, an officer or director of the Company
or any Subsidiary.
6.8 EMPLOYEE BENEFITS. From and after the Closing,
Purchaser shall cause each of the Company and the Subsidiaries to maintain
and perform all obligations in connection with the benefit plans and other
agreements set forth in SCHEDULE 6.8 that have accrued or otherwise become
vested, earned or due as a result of or prior to the Closing.
6.9 DEBT OBLIGATIONS. From and after the Closing, Purchaser
shall cause the Company and the Subsidiaries to honor all of their
obligations under (a) the indentures governing the Notes and (b) the Senior
Credit Facility.
6.10 INTERIM FINANCIALS: COOPERATION WITH FINANCING. During
the period prior to the Closing Date, the Company shall provide to Purchaser
consolidated monthly financial statements within 10 business days after the
end of each month. Further, the Company shall provide, and shall cause the
Subsidiaries to provide, all reasonable cooperation in connection with the
arrangement of Purchaser's financing including (a) promptly providing to
Purchaser's financing sources all material financial information in their
possession with respect to the Company and the acquisition reasonably
requested by Purchaser, including information and projections prepared by the
Company relating to the Company and the acquisition, (b) causing the
Company's senior officers and other Company representatives to be reasonably
available to Purchaser's financing sources in connection with such financing,
to reasonably participate in due diligence sessions and to reasonably
participate in presentations related to such financing, including "road show"
presentations to rating agencies, potential lenders and other investors, and
(c) reasonably assisting in the preparation of one or more appropriate
offering documents and assisting Purchaser's financing sources in preparing
other appropriate marketing materials, in each case to be used in connection
with such financing.
6.11 NOTIFICATION OF CERTAIN MATTERS. During the period
prior to the Closing Date, the Company shall give prompt written notification
to Purchaser, of (i) the occurrence, or failure to occur, of any event that
would be likely to cause any representation or warranty made by such party
contained in this Agreement to be materially untrue or inaccurate and (ii)
any failure of the Company or the Sellers, or of any officer, director,
employee or agent thereof, to comply with or satisfy any covenant, condition
or agreement to be complied with or satisfied by it hereunder.
Notwithstanding anything in this Agreement to the contrary, no such
notification shall affect the representations, warranties or covenants of the
parties or the conditions to the obligations of the parties hereunder
6.12 NON-SOLICITATION OF EMPLOYEES. Each of the Sellers
agrees that for a period of two years after the Closing Date neither such
Seller nor any person or entity controlling, controlled by or under common
control with such Seller will directly or indirectly, recruit, offer
employment, employ, engage as a consultant, lure or entice away or in any
other manner persuade or attempt to persuade any person who is an employee of
the Company or its
26
Subsidiaries, to leave the employ of the Company unless such person has been
terminated by the Company.
ARTICLE VII
CONDITIONS PRECEDENT TO OBLIGATION OF PURCHASER
The obligation of Purchaser to consummate the transactions
contemplated by this Agreement shall be subject to the satisfaction, on or
prior to the Closing Date, of the following conditions:
7.1 NO MISREPRESENTATION OR BREACH.
(a) There shall have been no material breach by the Company
or the Sellers in the performance of any of their covenants, agreements or
obligations herein.
(b) (i) The representations and warranties contained in
Article III hereof (except for the representations and warranties contained
in Sections 3.2, 3.5, 3.8, 3.11, 3.17 and 3.20) shall be true and correct as
of the Closing Date as though made on the Closing Date (except for
representations and warranties that speak as of a specific date prior to the
Closing Date which need only speak as of such date); PROVIDED, HOWEVER, that
the condition set forth in this subparagraph (b)(i) shall be considered
satisfied unless, ignoring for this purpose all qualifications as to
materiality and Material Adverse Effect in such representations and
warranties, the inaccuracies in such representations and warranties (with all
such inaccuracies taken in the aggregate) have had or would have a Material
Adverse Effect; (ii) the representations and warranties contained in Sections
3.2, 3.5, 3.11 and 3.17 hereof shall be true and correct in all material
respects, except for representations and warranties qualified by materiality
and Material Adverse Effect, which representations and warranties shall be
true and correct in all respects, as of the Closing Date as though made on
the Closing Date (except for representations and warranties that speak as of
a specific date prior to the Closing Date which need only speak of such
date); and (iii) the representations and warranties contained in Sections 3.8
and 3.20 hereof shall be true and correct as of the Closing Date as though
made on the Closing Date (except for representations and warranties that
speak as of a specific date prior to the Closing Date which need only be true
and correct as of such date); PROVIDED, HOWEVER, that the condition set forth
in this subparagraph (b)(iii) shall be considered satisfied unless ignoring
for this purpose all qualifications as to materiality and Material Adverse
Effect in such representations and warranties, the inaccuracies in either
Section 3.8 or 3.20 give rise to a loss or liability to the Company that
exceeds, in either case, $10,000,000.
(c) There shall have been no material breach by the Class D
Sellers in the performance of any of their covenants, agreements and
obligations herein, and none of the representations and warranties contained
in Article IV shall fail to be true and correct in any material respect on
the Closing Date as though made on the Closing Date.
7.2 RESIGNATIONS OF DIRECTORS. The Company and each
Subsidiary shall have furnished Purchaser with signed resignations, effective
as of the Closing, of each director of the Company or any Subsidiary
requested by Purchaser.
27
7.3 LITIGATION. As of the Closing Date, there shall be no
Law, injunction, restraining order or decree of any nature of any court or
other Governmental Body of competent jurisdiction that is in effect that
materially restrains or prohibits the consummation of the transactions
contemplated hereby.
7.4 GOVERNMENTAL APPROVALS. All authorizations, consents
and approvals of (or filings with) any Governmental Body shall have been
obtained (or made) and any waiting period under the H-S-R Act shall have
expired or been earlier terminated, except for those authorizations, consents
and approvals that have not had and would not have a Material Adverse Effect.
7.5 FIRPTA AFFIDAVIT. On or prior to the Closing Date, the
Company shall deliver a certification satisfying the requirements
of xxxxxxxx0.1445-2(c)(3) of the Treasury Regulations.
7.6 SHAREHOLDER APPROVAL FOR CERTAIN PAYMENTS OR BENEFITS.
Shareholder approval which complies with the requirements of Code Section
280G(b)(5) for any payments or benefits the deductibility of which is
otherwise disallowed under Section 280G of the Code shall have been obtained
by the Company.
7.7 LEGAL OPINIONS. Counsel for the Company and the Sellers
shall have delivered to Purchaser an opinion, dated as of the Closing Date,
in form and substance reasonably satisfactory to Purchaser.
7.8 AVAILABILITY OF FUNDS. Funds in an amount necessary to
satisfy Purchaser's obligations hereunder shall have been available to
Purchaser as contemplated by Section 5.7 whether pursuant to the Bridge
Facility or otherwise.
7.9 OFFICER'S CERTIFICATE. Purchaser shall have received a
certificate of the Company as to the matters set forth in Section 7.1 above
signed by a duly authorized officer of the Company.
7.10 DELIVERY OF DOCUMENTS. The Company and the Sellers
shall have furnished Purchaser with the certificates, agreements, opinions
and other documents required to be provided under this Agreement.
7.11 TERMINATION OF CERTAIN AGREEMENTS. As of the Closing
Date, all agreements between or among the Company, on the one hand, and the
Sellers and affiliates of the Sellers, on the other hand, shall have been
terminated without cost or liability to the Company or Purchaser.
7.12 TRANSACTION EXPENSES. On or prior to the Closing Date,
the Company shall provide evidence reasonably satisfactory to Purchaser that,
upon payment by the Company of invoices submitted by PricewaterhouseCoopers
LLP, Xxxxxx, Xxxx & Xxxxxxxx LLP and Xxxxxxx, Sachs & Co. all amounts due by
the Sellers or the Company to each of such firms for services related to this
Agreement have been paid in full and that neither the Company nor Purchaser
shall have any further liability or obligation in respect thereof or in
respect of any Transaction Expense after the Closing.
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ARTICLE VIII
CONDITIONS PRECEDENT TO OBLIGATIONS
OF THE COMPANY AND THE SELLERS
The obligations of the Company and the Sellers to
consummate the transactions contemplated by this Agreement shall be subject
to the satisfaction, on or prior to the Closing Date, of the following
conditions:
8.1 NO MISREPRESENTATION OR BREACH.
(a) There shall have been no material breach by Purchaser
in the performance of any of its covenants, agreements or obligations herein.
(b) Each of the representations and warranties contained in
Article V hereof shall be true and correct as of the Closing Date as though
made on the Closing Date (except for representations and warranties that
speak as of a specific date other than the Closing Date which need only be
true and correct as of such date); PROVIDED, HOWEVER, that the condition set
forth in this subparagraph (b) shall be considered satisfied unless, ignoring
for this purpose all qualifications as to materiality in such representations
and warranties, the inaccuracies in the representations and warranties (with
all such inaccuracies taken in the aggregate) would have a material adverse
effect on the ability of Purchaser to perform its obligations hereunder.
8.2 LITIGATION. The condition set forth in Section 7.3
shall have been satisfied.
8.3 GOVERNMENTAL APPROVALS. The condition set forth in
Section 7.4 shall have been satisfied.
8.4 OFFICER'S CERTIFICATE. Sellers shall have received a
certificate of Purchaser as to the matters set forth in Section 8.1 above
signed by a duly authorized officer of Purchaser.
ARTICLE IX
TERMINATION
9.1 TERMINATION. Notwithstanding anything contained in this
Agreement to the contrary, this Agreement may be terminated at any time prior
to the Closing Date: (a) by the mutual consent of Purchaser and the Company
(on behalf of itself and the Sellers); (b) by Purchaser in the event that any
condition set forth in Article VII shall not be satisfied and shall not be
reasonably capable of being remedied on or prior to October 31, 2001; (c) by
the Company (on behalf of itself and the Sellers) in the event that any
condition set forth in Article VIII shall not be satisfied and shall not be
reasonably capable of being remedied on or prior to October 31, 2001; and (d)
by the Company (on behalf of itself and the Sellers) or by Purchaser if the
Closing shall not have occurred on or before October 31, 2001; PROVIDED,
HOWEVER, that no party may terminate this Agreement pursuant to clause (b),
(c) or (d) if the failure of any condition in Article VII or Article VIII to
be satisfied or the failure of the Closing to occur on or before October 31,
2001 results from the breach by such party of this Agreement.
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9.2 EFFECT OF TERMINATION. If this Agreement is terminated
pursuant to this Article IX, all obligations of the parties under this
Agreement (other than under this Section 9.2, or under Section 6.2, Section
6.5, Section 10.5 and Section 10.14) shall be terminated without liability or
penalty on the part of any party or its officers, directors shareholders to
any other party; PROVIDED, HOWEVER that no such termination shall relieve any
party from liability for damages resulting from any breach by such party of
this Agreement or otherwise limit any remedy available to a party or parties
on account of any such breach.
ARTICLE X
GENERAL PROVISIONS
10.1 NON-SURVIVAL OF REPRESENTATIONS AND WARRANTIES. None of
the representations and warranties set forth in Article III, IV or V of this
Agreement shall survive the Closing.
10.2 NOTICES. All notices and other communications given or
made pursuant to this Agreement shall be in writing and shall be deemed to
have been duly given or made (a) three business days after being sent by
registered or certified mail, return receipt requested, (b) upon delivery, if
hand delivered, (c) one business day after being sent by prepaid overnight
carrier with guaranteed delivery, with a record of receipt, or (d) upon
transmission with confirmed delivery if sent by facsimile or telecopy (with a
copy simultaneously sent by registered or certified mail, return receipt
requested), to the parties at the following addresses (or at such other
addresses as shall be specified by the parties by like notice):
(a) if to Purchaser:
CH Acquisitions LLC
c/o Berkshire Partners LLC
Xxx Xxxxxx Xxxxx
Xxxxxx, XX 00000-0000
Attention: Xxxx Xxxxx
Telecopy: (000) 000-0000
with a copy to:
Ropes & Xxxx
Xxx Xxxxxxxxxxxxx Xxxxx
Xxxxxx, XX 00000
Attention: Xxxxx X. Xxxxxx, Esq.
Telecopy: (000) 000-0000
(b) if to the Company:
Xxxxxx Holdings, Inc.
0000 Xxxxxxx Xxxxxxx, Xxxxx 000
Xxxxxx, XX 00000
30
Attention: Chief Executive Officer
Telecopy: (000) 000-0000
with a copy to:
Xxxxxx, Xxxx & Xxxxxxxx LLP
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: E. Xxxxxxx Xxxxxxx, Esq.
Telecopy: (000) 000-0000
(c) if to Sellers:
to the addresses set forth
on EXHIBIT E hereto
with a copy to:
Xxxxxx, Xxxx & Xxxxxxxx LLP
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: E. Xxxxxxx Xxxxxxx, Esq.
Xxxxx X. Xxxxxxxxx, Esq.
Telecopy: (000) 000-0000
10.3 PARTIAL INVALIDITY. Wherever possible, each provision
hereof shall be interpreted in such manner as to be effective and valid under
applicable law but, in the case that any provision contained herein shall,
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 or provisions had never
been contained herein unless the deletion of such provision or provisions
would result in such a material change as to cause completion of the
transactions contemplated hereby to be unreasonable.
10.4 EXECUTION IN COUNTERPARTS; FACSIMILE SIGNATURES. This
Agreement may be executed in two or more counterparts, each of which shall be
considered an original instrument, but all of which shall be considered one
and the same agreement, and shall become binding when one or more
counterparts have been signed by each of the parties and delivered to each of
the Company and Purchaser. Facsimile signatures shall be treated as originals
to the extent the sender can show that such facsimile was actually
transmitted.
10.5 GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the laws of the State of
New York, without regard
to principles of conflicts of laws. The parties hereby irrevocably submit to the
jurisdiction of the courts of the State of
New York and the Federal courts of
the United States of America located in the Borough of Manhattan, the City of
New York solely in respect of the interpretation and enforcement of the
31
provisions of this Agreement and the transactions contemplated hereby and
hereby waive, and agree not to assert, as a defense in any action, suit or
proceeding for the interpretation or enforcement hereof, that it is not
subject thereto or that such action, suit or proceeding may not be brought or
is not maintainable in said courts or that the venue thereof may not be
appropriate or that this Agreement may not be enforced in or by such courts,
and the parties hereto irrevocably agree that all claims with respect to such
action or proceeding shall be heard and determined in such courts. The
parties consent to and grant any such court jurisdiction over the person of
such parties and over the subject matter of such dispute and agree that
mailing of process or other papers in connection with any such action or
proceeding in the manner provided in Section 10.2 or in such other manner as
may be permitted by law shall be valid and sufficient service thereof.
10.6 EXPENSES. Except as otherwise provided herein and
except that at Closing the Company shall pay the Transaction Expenses, each
party hereto will bear all expenses incurred by it in connection with this
Agreement and the transactions contemplated hereby.
10.7 ASSIGNMENT; SUCCESSORS AND ASSIGNS; NO THIRD PARTY
BENEFICIARIES. Neither this Agreement nor any of the rights, interests or
obligations hereunder shall be assigned by any of the parties hereto without
the prior written consent of the other parties. Subject to the foregoing,
this Agreement shall be binding upon and inure to the benefit of the parties
hereto and their respective successors or assigns, heirs, legatees,
distributees, executors, administrators and guardians. Nothing in this
Agreement, expressed or implied, is intended or shall be construed to confer
a benefit upon any Person other than the parties hereto (and their successors
and assigns permitted by this Section 10.7) and the Indemnified Parties and
their respective heirs, legatees and personal representatives to the extent
provided in Section 6.7.
10.8 NO IMPLIED REPRESENTATION. Notwithstanding anything
contained in this Agreement to the contrary, it is the explicit intent of
each party hereto that the Company, the Subsidiaries and the Sellers are
making no representation or warranty whatsoever, express or implied, beyond
those expressly given in this Agreement.
10.9 TITLES AND HEADINGS. Titles and headings to sections
herein are inserted for convenience of reference only and are not intended to
be a part of or to affect the meaning or interpretation of this Agreement.
10.10 SCHEDULES AND EXHIBITS. The schedules and exhibits
referred to in this Agreement shall be construed with and as an integral part
of this Agreement to the same extent as if the same had been set forth
verbatim herein. Disclosure of any fact or item in any schedule hereto shall
be deemed to be disclosed in the other schedules hereto notwithstanding the
lack of a specific cross-reference.
10.11 KNOWLEDGE. In each provision of this Agreement in
which a representation or warranty is qualified to the "knowledge" of a
Person or to the "best of the knowledge" of a person, unless otherwise stated
in such provision, each such phrase means that the Person does not have
actual knowledge of any state of facts which is different from the facts
described in the warranty or representation. With respect to the Company,
such knowledge shall refer solely to the "knowledge" of one or more of those
individuals identified in SCHEDULE 10.11.
32
10.12 ENTIRE AGREEMENT; AMENDMENTS. This Agreement,
including the schedules and exhibits, contains the entire understanding of
the parties hereto with regard to the subject matter contained herein. The
parties hereto, by mutual agreement in writing, may amend, modify and
supplement this Agreement. Purchaser and the Management Sellers may amend the
terms of this Agreement in Section 2.1(b), Section 2.4, EXHIBIT A or EXHIBIT
D, without the consent of any other party hereto that is not adversely
affected by such action. Any purported amendment that does not comply with
the foregoing shall be null and void.
10.13 WAIVERS. Any term or provision of this Agreement may
be waived, or the time for its performance may be extended, by the party or
parties entitled to the benefit thereof. The failure of any party hereto to
enforce at any time any provision of this Agreement shall not be construed to
be a waiver of such provision, nor in any way to affect the validity of this
Agreement or any part hereof or the right of any party thereafter to enforce
each and every such provision. No waiver of any breach of this Agreement
shall be held to constitute a waiver of any other or subsequent breach.
10.14 WAIVER OF JURY TRIAL. Each party acknowledges and
agrees that any controversy which may arise under this Agreement is likely to
involve complicated and difficult issues, and therefore each such party
hereby irrevocably and unconditionally waives any right such party may have
to a trial by jury in respect of any litigation directly or indirectly
arising out of or relating to this Agreement or the transactions contemplated
hereby. Each party certifies and acknowledges that (i) no representative,
agent or attorney of any other party has represented, expressly or otherwise,
that such other party would not, in the event of litigation, seek to enforce
the foregoing waiver, (ii) each party understands and has considered the
implications of this waiver, (iii) each party makes this waiver voluntarily,
and (iv) each party has been induced to enter into this agreement by, among
other things, the mutual waivers and certifications in this Section 10.14.
(signatures on next page)
33
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed as of the day and year first above written.
CH ACQUISITIONS LLC, a Delaware XXXXXX HOLDINGS, INC., a
limited liability company Massachusetts corporation
By: /s/ XXXX X. XXXXX By: /s/ XXXXX X. XXXXX
-------------------------- ------------------------
Name: XXXX X. XXXXX Name: XXXXX X. XXXXX
Title: VICE PRESIDENT Title: EXECUTIVE VICE PRESIDENT
(signatures continue on the next page)
CLASS D HOLDERS
BALLET LIMITED DENARY LIMITED
By: /s/ XXXXXX X. XXXXXX By: /s/ XXXXX X. XXXXXXX
-------------------------- ------------------------
Name: XXXXXX X. XXXXXX Name: XXXXX X. XXXXXXX
Title: AUTHORIZED REPRESENTATIVE Title: AUTHORIZED REPRESENTATIVE
Number of Shares: 460 Number of Shares: 460
GLEAM LIMITED HIGHLANDS LIMITED
By: /s/ XXXXXXXX X. XXXXX By: /s/ XXXXX XX XXXXXXX
-------------------------- ------------------------
Name: XXXXXXXX X. XXXXX Name: XXXXX XX XXXXXXX
Title: AUTHORIZED REPRESENTATIVE Title: AUTHORIZED REPRESENTATIVE
Number of Shares: 460 Number of Shares: 460
NOBLE LIMITED OUTRIGGER LIMITED
By: /s/ XXXXX XXXXXXX By: /s/ XXXXXX XXXXXXX
-------------------------- ------------------------
Name: XXXXX XXXXXXX Name: XXXXXX XXXXXXX
Title: AUTHORIZED REPRESENTATIVE Title: AUTHORIZED REPRESENTATIVE
Number of Shares: 460 Number of Shares: 460
(signatures continue on next page)
CLASS D HOLDERS
QUILL LIMITED RADIAL LIMITED
By: /s/ XXXXXXX XX XXXXX By: /s/ XXXXXX XXXXX
-------------------------- ------------------------
Name: XXXXXXX XX XXXXX Name: XXXXXX XXXXX
Title: AUTHORIZED REPRESENTATIVE Title: AUTHORIZED REPRESENTATIVE
Number of Shares: 460 Number of Shares: 460
SHORELINE LIMITED ZINNIA LIMITED
By: /s/ XXXXX X'XXXX By: /s/ XXXXX GNOLAN
-------------------------- ------------------------
Name: XXXXX X'XXXX Name: XXXXX GNOLAN
Title: AUTHORIZED REPRESENTATIVE Title: AUTHORIZED REPRESENTATIVE
Number of Shares: 460 Number of Shares: 460
INVESTCORP INVESTMENT EQUITY LIMITED
By: /s/ SYDNEY X. XXXXXXX
---------------------------
Name: THE DIRECTOR LTD.
Title: DIRECTOR
Number of Shares: 400
(signatures continue on next page)
CLASS A HOLDERS
CARTER'S INTERNATIONAL LIMITED LAYETTE EQUITY LIMITED
By: /s/ X. XXXXX By: /s/ A.Y. WILL
-------------------------- ------------------------
Name: BLUEJAY INVESTMENTS LTD. Name: CARDINAL INVESTMENTS LTD.
Title: DIRECTOR Title: DIRECTOR
Number of Shares: 73,074 Number of Shares: 73,074
LAYETTE INVESTMENTS LIMITED CLASSICS HOLDINGS LIMITED
By: /s/ A.Y. WILL By: /s/ W XXXXX
-------------------------- ------------------------
Name: CARDINAL INVESTMENTS LTD. Name: BLUEJAY INVESTMENTS LTD.
Title: DIRECTOR Title: DIRECTOR
Number of Shares:73,074 Number of Shares: 73,074
LAYETTE HOLDINGS LIMITED CLASSICS EQUITY LIMITED
By: /s/ A.Y. WILL By: /s/ A.Y. WILL
-------------------------- ------------------------
Name: CARDINAL INVESTMENTS LTD. Name: CARDINAL INVESTMENTS LTD.
Title: DIRECTOR Title: DIRECTOR
Number of Shares: 73,074 Number of Shares: 73,074
(signatures continue on next page)
CLASS A HOLDERS
CLASSICS INVESTMENTS LIMITED WCC INVESTMENTS LIMITED
By: /s/ X. XXXXX By: /s/ X. XXXXX
-------------------------- ------------------------
Name: BLUEJAY INVESTMENTS LTD. Name: BLUEJAY INVESTMENTS LTD.
Title: DIRECTOR Title: DIRECTOR
Number of Shares: 73,074 Number of Shares: 66,664
INVESTCORP CARTER'S HOLDINGS L.P. EQUITY CARA LIMITED
By: /s/ XXXXXXX XX XXXXX By: /s/ SYDNEY X. XXXXXXX
-------------------------- ------------------------
Name: XXXXXXX XX XXXXX Name: THE DIRECTOR LTD.
Title: DIRECTOR, XXXXXX EQUITY LTD. Title: DIRECTOR
GENERAL PARTNER
Number of Shares: 40,568.1892 Number of Shares: 68,840.5796
EQUITY CARB LIMITED
By: /s/ SYDNEY X. XXXXXXX
--------------------------
Name: THE DIRECTOR LTD.
Title: DIRECTOR
Number of Shares: 65,217.3912
(signatures continue on next page)
CLASS C HOLDERS
WCC HOLDINGS LIMITED INVESTCORP CARTER'S HOLDINGS L.P.
By: /s/ X. XXXXX By: /s/ XXXXXXX XX XXXXX
------------------------------- -----------------------------
Name: BLUEJAY INVESTMENTS LTD. Name: XXXXXXX XX XXXXX
Title: DIRECTOR Title: DIRECTOR, XXXXXX EQUITY LTD.
GENERAL PARTNER
Number of Shares: 25,640 Number of Shares: 31,193.86
XX XXXXXX (SUISSE) AS SUCCESSOR BANK TO
THE CHASE MANHATTAN PRIVATE BANK (SWITZERLAND)
By: /s/ XXXXX XXXXXXX By: /s/ XXXXXXXXX X. XXXXX, XX
------------------------------- -----------------------------
Name: XXXXX XXXXXXX Name: XXXXXXXXX X. XXXXX, XX
Title: VICE PRESIDENT
By: /s/ XXXXXXX X'XXXXX
--------------------------
Name: XXXXXXX X'XXXXX
Title: ASSISTANT TREASURER
Number of Shares: 34,309 Number of Shares: 56,649.455
By: /s/ XXXXX X. XXXXX By: /s/ XXXXXX XXXXXXXX
------------------------------- ----------------------------
Name: XXXXX X. XXXXX Name: XXXXXX XXXXXXXX
Number of Shares: 15,051.317 Number of Shares: 15,051.317
By: /s/ XXXXXXX X. XXXXXXX, XX. By: /s/ XXXXXXX X. XXXXX
------------------------------- ----------------------------
Name: XXXXXXX X. XXXXXXX, XX. Name: XXXXXXX X. XXXXX
Number of Shares: 15,051.317 Number of Shares: 2,289.359
By: /s/ XXXXXXX X. XXXXX By: /s/ XXXXXXX X. XXXXXXX
------------------------------- ----------------------------
Name: XXXXXXX X. XXXXX Name: XXXXXXX X. XXXXXXX
Number of Shares: 2,289.359 Number of Shares: 1,558.712
(signatures continue on next page)
CLASS C HOLDERS
By: /s/ XXXXXXXX X. XXXXXX By: /s/ XXXXXX X. XXXXXX, XX.
------------------------------- ----------------------------
Name: XXXXXXXX X. XXXXXX Name: XXXXXX X. XXXXXX, XX.
Number of Shares: 1,510.003 Number of Shares: 1,510.003
By: /s/ X. XXXXXX XXXXXX By: /s/ XXX X. XXXXX
------------------------------- ----------------------------
Name: X. XXXXXX XXXXXX Name: XXX X. XXXXX
Number of Shares: 1,510.003 Number of Shares: 1,169.035
By: /s/ XXXX X. XXXXXX By: /s/ XXXXXXX X. BLYTHEWOOD
------------------------------- ----------------------------
Name: XXXX X. XXXXXX Name: XXXXXXX X. BLYTHEWOOD
Number of Shares: 1,169.035 Number of Shares: 779.356
By: /s/ XXXXX X. XXX By: /s/ XXXXX X. XXXX
------------------------------- ----------------------------
Name: XXXXX X. XXX Name: XXXXX X. XXXX
Number of Shares: 389.678 Number of Shares: 389.678
By: /s/ XXXXXX X. XXXXX By: /s/ XXXXXX X. XXXXX
------------------------------- ----------------------------
Name: XXXXXX X. XXXXX Name: XXXXXX X. XXXXX
Number of Shares: 500 Number of Shares: 1,000
(signatures continue on next page)
CLASS C HOLDERS
By: /s/ XXXXX X. XXXXXXX By: /s/ XXXXX X. XXXXXX
------------------------------- ----------------------------
Name: XXXXX X. XXXXXXX Name: XXXXX X. XXXXXX
Number of Shares: 1,000 Number of Shares: 1,000
(end of signatures)
