Exhibit 4.2
PURCHASE AGREEMENT
This PURCHASE AGREEMENT (this "Agreement") is made and entered into
this 21st day of February, 2002, by and between MCM Capital Group, Inc., a
Delaware corporation (the "Company"), and the purchasers listed in Schedule A
hereto (collectively the "Purchasers").
RECITALS
WHEREAS, the Company proposes to issue and sell, and the Purchasers are
willing to purchase, shares of Series A Senior Cumulative Participating
Convertible Preferred Stock of the Company having the preferences, rights and
privileges set forth in the Certificate of Designation attached as Exhibit A
hereto (the "Convertible Preferred Stock") at a per share price of $5.00 (the
"Purchase Price"); and
WHEREAS, subject to the terms and conditions hereof, each of the
Purchasers is willing to purchase the number of shares of Convertible Preferred
Stock indicated opposite its name on Schedule A (collectively, the "Purchaser
Shares");
NOW, THEREFORE, in consideration of the several and mutual promises,
agreements, covenants, understandings, undertakings, representations and
warranties hereinafter set forth, and for other good and valuable consideration,
the receipt and sufficiency of which is hereby acknowledged, the parties agree
as follows:
1. PURCHASE AND SALE.
Subject to the terms and conditions and in reliance upon the
representations and warranties herein set forth below, at the Closing (as
defined below), the Company agrees to sell to the Purchasers, and each of the
Purchasers, severally and not jointly, agrees to purchase from the Company at
the Purchase Price the aggregate number of Purchaser Shares set forth opposite
the name of such Purchaser in Schedule A attached hereto.
2. CLOSING; DELIVERY.
(a) The closing of the transactions contemplated under this Agreement
(the "Closing") shall take place at the offices of Debevoise & Xxxxxxxx, 000
Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx, at 10:00 a.m. on a date mutually agreed to by
the Purchasers and the Company, but in any event not later than February 22,
2002, unless otherwise mutually agreed to by the Purchasers and the Company (the
"Closing Date").
(b) At the Closing, the Company will deliver to each Purchaser a
certificate or certificates in definitive form in such denominations and
registered in such Purchaser's name (or the name of its nominee), representing
the Purchaser Shares to be purchased by such Purchaser against payment by such
Purchaser of the Purchase Price therefor. All such Purchase Price payments shall
be made by the applicable Purchaser by wire transfer of immediately available
funds to the account of the Company at such bank and to such account may be
specified by the Company by written notice to the Purchasers not less than three
Business Days prior to the Closing.
3. REPRESENTATIONS AND WARRANTIES.
(a) The Company hereby represents and warrants to each of the
Purchasers as follows:
(i) The Company, and each of its subsidiaries, has been duly
incorporated and is validly existing as a corporation in good standing under the
laws of the jurisdiction of its incorporation.
(ii) The execution, delivery and performance of this Agreement
by the Company and the consummation by the Company of the transactions
contemplated hereby have been duly authorized by all necessary corporate action
of the Company, and this Agreement, when duly executed and delivered by the
Purchasers, will constitute a valid and legally binding obligation of the
Company enforceable in accordance with its terms, subject to bankruptcy,
insolvency, fraudulent transfer, reorganization, moratorium and similar laws of
general applicability relating to or affecting creditors' rights and to general
equity principles.
(iii) The authorized capital stock of the Company consists of
50,000,000 shares of common stock, par value $0.01 per share (the "Common
Stock"), and 5,000,000 shares of preferred stock, par value $0.01 per share. As
of the close of business on the date immediately preceding the date hereof,
7,161,131 shares of Common Stock were issued and outstanding and no shares of
preferred stock were issued or outstanding. Except as set forth in Schedule B
attached hereto, there are no outstanding options, warrants, rights or
securities convertible into or exchangeable for any class of capital stock of
the Company, and no authorization therefor has been given, except as
contemplated hereby. All outstanding shares of capital stock and other equity or
voting securities of the Company are duly authorized, validly issued, fully paid
and nonassessable and not subject to, or issued in violation of any preemptive
right or any similar right.
(iv) The Purchaser Shares have been duly authorized by all
necessary corporate action of the Company, and when issued and paid for in
accordance herewith, will be duly and validly issued, fully paid and
nonassessable and not subject to or issued in violation of any preemptive rights
or any similar right. The Company has duly reserved for issuance upon conversion
or other exercise of rights under the Purchaser Shares from its authorized but
unissued shares of Common Stock such number of shares of Common Stock as is
necessary to permit the conversion or other exercise of the Purchaser Shares in
full.
(v) Except as set forth in Schedule 3(a)(v) of the Disclosure
Schedules attached hereto, the execution and delivery of this Agreement and the
Registration Rights Agreement attached hereto as Exhibit B (the "Registration
Rights Agreement"), the adoption by the Board of Directors of the Company of the
certificate of designation attached hereto as Exhibit A (the "Certificate of
Designation"), the consummation by the Company of the transactions herein and
therein contemplated and the compliance by the Company with the terms hereof and
thereof do not and will not conflict with, or result in
2
a breach or violation of any of the terms or provisions of, or constitute a
default under, the Certificate of Incorporation or Bylaws of the Company, or any
indenture, mortgage, deed or trust, loan agreement or other agreement or
instrument to which the Company is a party or by which any of its properties or
assets are bound, or any applicable law, rule, regulation, judgment, order or
decree of any government, governmental instrumentality or court having
jurisdiction over the Company or any of its properties or assets; and will not
result in any anti-dilution adjustment pursuant to the terms of any outstanding
options, warrants, rights or convertible debentures; and no consent, approval,
authorization, order, registration or qualification of or with any such
governmental instrumentality or court is required for the valid authorization,
execution, delivery and performance by the Company of this Agreement, the
Registration Rights Agreement, the Certificate of Designation, the issuance and
sale of the Purchaser Shares, or the issuance of shares of Common Stock upon
conversion or other exercise of the Convertible Preferred Stock, except for the
filing of the Certificate of Designation with the Secretary of State of
Delaware, a Form D with the U.S. Securities and Exchange Commission (the
"Commission") and any necessary State blue sky or similar filings.
(vi) The Company has filed with the Commission all forms,
reports, schedules, registration statements, definitive proxy statements and
other documents required to be filed by the Company with the Commission under
the Securities Act of 1933 (the "Securities Act") or the Securities Exchange
Act of 1934 (the "Exchange Act") since January 1, 2001 (as they have been
amended or superseded by subsequent filings under the Securities Act or Exchange
Act since the time of their filing, and including any documents filed as
exhibits thereto and all financial statements or schedules included or
incorporated by reference therein, collectively, the "SEC Reports"). The SEC
Reports complied in all material respects with the requirements of the
Securities Act or the Exchange Act, as applicable, and the rules and regulations
of the Commission promulgated thereunder. As of their respective dates, as of
the date they were filed or, if amended or superseded by subsequent filings
under the Securities Act or Exchange Act, as of the date of such amendment or
superseding filing, none of the SEC Reports contained any untrue statement of a
material fact or omitted to state a material fact required to be stated therein
or necessary to make the statements made therein, in light of the circumstances
under which they were made, not misleading.
(vii) Each of the consolidated financial statements
(including, in each case, any notes thereto) contained in the SEC Reports (as
such financial statements have been amended or restated since the time of that
filing) was prepared in accordance with United States generally accepted
accounting principles (except, in the case of unaudited quarterly statements, as
permitted by Form 10-Q of the Exchange Act and subject to normal year-end audit
adjustments which are not individually or in the aggregate material) applied on
a consistent basis throughout the periods indicated (except as may be indicated
in the notes thereto) and each fairly presents, in all material respects, the
consolidated financial position, results of operations and cash flows of the
Company and its consolidated subsidiaries as at the respective dates thereof and
for the respective periods indicated therein (except as otherwise noted
therein). The Company has not incurred any material liability or contingent
liability since September 30, 2001, except for liabilities incurred in the
ordinary course of business, none of which, individually or in
3
the aggregate, has had or would reasonably be expected to have a material
adverse effect on the condition (financial or otherwise), business, properties,
results of operations or prospects of the Company and its subsidiaries taken as
a whole.
(viii) Except as set forth in Schedule C hereto, no
stockholder of the Company or any other third party has the contractual right to
require the Company to register for public resale any securities issued by the
Company.
(b) Each of the Purchasers hereby represents and warrants severally and
not jointly to the Company with respect to such Purchaser as follows:
(i) To the extent such Purchaser is an entity, it has been
duly organized and is validly existing in good standing under the laws of the
jurisdiction of its organization.
(ii) The execution, delivery and performance of this Agreement
and the consummation of the transactions contemplated hereby have been duly
authorized by all necessary action, and this Agreement, when duly executed and
delivered by such Purchaser, will constitute a valid and legally binding
instrument, enforceable in accordance with its terms, subject to bankruptcy,
insolvency, fraudulent transfer, reorganization, moratorium and similar laws of
general applicability relating to or affecting creditors' rights and to general
equity principles.
(iii) Such Purchaser has or will not later than the Closing
Date have sufficient cash resources on hand to purchase the Purchaser Shares to
be purchased by such Purchaser on the terms and conditions contained in this
Agreement.
(iv) No state, federal or foreign regulatory approvals,
permits, licenses, or consents or other contractual or legal obligations are
required to be obtained by such Purchaser in order to enter into this Agreement
or purchase its Purchaser Shares.
(v) The execution and delivery of this Agreement, the
consummation of the transactions herein contemplated and the compliance with the
terms hereof do not and will not conflict with, or result in a breach or
violation of any of the terms or provisions of, or constitute a default under,
the certificate of incorporation or bylaws of such Purchaser, or any indenture,
mortgage, deed of trust, loan agreement or other agreement or instrument to
which such Purchaser is a party or by which any of such Purchaser's properties
or assets are bound, or any applicable law, rule, regulation, judgment, order or
decree of any government, governmental jurisdiction over such Purchaser or any
of such Purchaser's properties or assets; and no consent, approval or
authorization of any government, governmental instrumentality or court, domestic
or foreign, is required for the valid authorization, execution, delivery and
performance by such Purchaser of this Agreement or the consummation of the
transactions contemplated by this Agreement.
(vi) Such Purchaser is acquiring its Purchaser Shares, and any
underlying Common Stock issuable upon conversion or other exercise thereof, for
its own account for investment only and not with a view towards, or for resale
in connection
4
with, the public sale or distribution thereof, except pursuant to sales
registered or exempted under the Securities Act.
(vii) The Purchaser is an "accredited investor" as that term
is defined in Rule 501(a)(3) of Regulation D of the Securities Act.
(viii) The Purchaser acknowledges that the offer and sales of
the Purchaser Shares is being made in reliance on specific exemptions from the
registration requirements of United States federal and state securities laws and
that the Company is relying in part upon the truth and accuracy of, and the
Purchaser's compliance with, the representations, warranties, agreements,
acknowledgements and understandings of the Purchaser set forth herein in order
to determine the availability of such exemptions and the eligibility of the
Purchaser to acquire such Purchaser Shares.
(ix) The Company has made available to each Purchaser and its
respective advisors, if any, all materials relating to the business, finances
and operations of the Company and materials relating to the offer and sale of
the Purchaser Shares which have been requested by such Purchaser. Each Purchaser
and its advisors, if any, have been afforded the opportunity to ask questions of
the Company.
(x) Each Purchaser understands that no United States federal
or state agency or any other government or governmental agency has passed on or
made any recommendation or endorsement of the Purchaser Shares or the fairness
or suitability of the investment in the Purchaser Shares nor have such
authorities passed upon or endorsed the merits of the offering of the Purchaser
Shares.
4. COVENANTS.
The Company agrees with the Purchasers as follows:
(a) The Company will promptly advise the Purchasers of and consult with
the Purchasers and their counsel if any of the representations and warranties
contained in Section 3(a) hereof were inaccurate in any material respect when
made.
(b) The Company shall at all times reserve and keep available for issue
upon conversion or other exercise of the Purchaser Shares such number of
authorized but unissued shares of Common Stock deliverable upon the conversion
of or other exercise of rights under the Purchaser Shares (including Convertible
Preferred Stock issued in lieu of cash dividends, to the extent permitted under
the Certificate of Designation) as will be sufficient to permit the conversion
or other exercise thereof in full.
(c) The Company shall, as long as 10% or more of the Purchaser Shares
shall remain outstanding or any Purchaser nominee elected pursuant to the
provisions of Section 3(b) of the Certificate of Designation remains a member of
the Board, maintain the Company's current directors' and officers' insurance
policy or in replacement thereof, with a reputable and creditworthy insurer
acceptable to Triarc Companies, Inc. and C.P. International Investments Limited
and in providing substantially equivalent coverage to that provided under the
Company's current directors' and officers' insurance policy.
5
(d) Prior to the Closing Date, the Company and each Purchaser agrees
that it shall make no written or other public disclosure or announcement
regarding this Agreement or discuss the terms hereof with any person without the
prior written consent of the other parties, except for disclosures to the
professional advisors, employees and directors of the parties or as otherwise
required by law or the rules and regulations of the Commission or any applicable
stock exchange; provided that any proposed press release or other disclosure
with respect to this Agreement shall be provided in advance by the disclosing
party to Triarc Companies, Inc. and C.P. International Investments Limited
subject to their approval, such approval not to be unreasonably withheld (it
being agreed that the failure of such parties to respond within two Business
Days to any proposed press release or other disclosure provided to them shall
constitute their approval thereof).
(e) The Company acknowledges that it shall, to the extent permitted by
law, treat the Convertible Preferred Stock as "common stock" under U.S. federal
income tax principles and not "preferred stock" within the meaning of Section
1.305-5(a) of the Treasury Regulations. The Company agrees, to the extent
permitted by law, to treat any dividend paid on the Convertible Preferred Stock
in the form of additional Convertible Preferred Stock as a tax-free stock
dividend pursuant to Section 305(a) of the U.S. Internal Revenue Code and will
not take any position inconsistent therewith for U. S. federal income tax
reporting purposes. The Company and the Purchasers acknowledge that the
determination of whether the Convertible Preferred Stock constitutes "preferred
stock" for purposes of Section 305 of the Code is determined at the time a
distribution is made, based upon all of the facts and circumstances which
indicate whether such Convertible Preferred Stock has little or no likelihood of
actually participating currently and upon liquidation in the earnings and growth
of the Company.
(f) The Company will furnish the following reports to each Purchaser so
long as such Purchaser beneficially owns at least 10% of the shares of
Convertible Preferred Stock purchased by it:
(i) Copies of its annual reports on Form 10-K and its
quarterly reports on Form 10-Q, respectively, promptly upon filing thereof with
the Commission; and
(ii) Copies of any current reports on Form 8-K, promptly upon
filing thereof with the Commission.
(g) The Company will prepare and furnish, upon written request which
refers to this provision, to any Purchaser so long as such Purchaser
beneficially owns at least 10% of the share of Convertible Preferred Stock
purchased by it:
(i) As soon as practicable after the end of each month and in
any event within thirty days thereafter, a consolidated balance sheet of the
Company and its subsidiaries, if any, as at the end of such month, and
consolidated statements of operations and of cash flows of the Company and its
subsidiaries, for each month and for the current fiscal year of the Company to
date, prepared in accordance with United States generally accepted accounting
principles consistently applied, together with a comparison of such statements
to the Company's operating plan then in effect and approved by its
6
Board of Directors (the "Board"), or the Executive Committee thereof, and a
comparison of such statements to the statements for the corresponding periods of
the Company's previous fiscal year, and certified, subject to changes resulting
from year-end audit adjustments, by the principal financial or accounting
officer of the Company; and
(ii) As soon as available (but in any event within sixty days
prior to the commencement of its fiscal year) a summary of the business plan and
financial plan of the Company for the next fiscal year, as contained in its
operating plan approved by the Board. Any material changes in such financial
plan shall be submitted as promptly as practicable after such changes have been
approved by the Board;
provided that the Company shall be required to furnish to any Purchaser any of
the information referred to in this Section 4(g) only at the same time and to
the same extent it is required to furnish such information to its banks or other
lenders pursuant to any of the Company's financing arrangements; and provided
further, that each Purchaser agrees to keep all non-public information
furnished to it pursuant to this Agreement confidential and not to take any
actions with respect thereto which violate any applicable laws.
(h) So long as any Purchaser beneficially owns at least 10% of the
shares of Convertible Preferred Stock purchased by it, the Company will permit
such Purchaser to visit and inspect any of the properties of the Company,
including its books of account, and to discuss its affairs, finances and
accounts with the Company's officers and its independent public accountants on
reasonable notice, all at such reasonable times during normal business hours and
as often as any such person may reasonably request.
5. CLOSING CONDITIONS.
(a) The respective obligations of the Purchasers and the Company to
consummate the purchase and sale of the Purchaser Shares shall be subject in the
discretion of the Company or the Purchasers, as the case may be, to the
conditions that (i) all representations and warranties and other statements of
the other party were true and correct in all material respects when made and
shall be repeated and be true and correct in all material respects at and as of
the Closing (other than those qualified by materiality, which shall be true and
correct in all respects), and (ii) the other party or parties shall have
performed all of its obligations hereunder theretofore to be performed at or
prior to the Closing in all material respects.
(b) The obligations of the Purchasers to consummate the purchase of the
Purchaser Shares shall be subject to the following additional conditions
precedent:
(i) The Purchasers shall have received a certificate, dated
such Closing Date, of the president or any vice president and a principal
financial or accounting officer of the Company in which such officers, to the
best of their knowledge after reasonable investigation, shall state that: the
representations and warranties of the Company in this Agreement are true and
correct in all material respects when made and as of the Closing (other than
those qualified by materiality, which shall be true and correct in all
respects), the Company has complied with all agreements and satisfied all
7
conditions on its part to be performed or satisfied hereunder at or prior to
such Closing Date; and, except as set forth in Schedule 5(b)(i) of the
Disclosure Schedules attached hereto, subsequent to September 30, 2001, there
has been no material adverse change, nor any development or event involving a
prospective material adverse change, in the condition (financial or other),
business, properties, results of operations or prospects of the Company and its
subsidiaries taken as a whole;
(ii) The Purchasers shall have received an opinion of Xxxxx &
Xxxxxx, L.L.P., counsel to the Company, in form and substance satisfactory to
the Purchasers;
(iii) The Purchasers shall have received an opinion from BDO
Xxxxxxx, LLP, with respect to certain matters relating to Section 382 of the
U.S. Internal Revenue Code, in form and substance reasonably satisfactory to the
Purchasers;
(iv) The Purchasers shall have received evidence of such
amendments, consents and waivers to the existing registration rights agreements
to which the Company is a party as shall be necessary to give effect to the
Registration Rights Agreement;
(v) The Purchasers shall have received evidence of the
restructuring of the terms and amount of the Company's outstanding indebtedness
to ING (U.S.) Capital LLC ("ING"), as well as relief from restricted payments
covenants sufficient to permit payments on the Convertible Preferred Stock as
provided in the Certificate of Designation, and the surrender by ING of warrants
to purchase 200,000 shares of Common Stock, in form and substance satisfactory
to the Purchasers;
(vi) The Purchasers shall have received evidence of the
qualification under applicable Blue Sky laws or exemption therefrom the shares
of Convertible Preferred Stock to be issued and sold hereunder and the shares of
Common Stock to be issued upon conversion or other exercise of the Convertible
Preferred Stock;
(vii) The Certificate of Designation establishing the rights
and preferences of the Convertible Preferred Stock, shall have been filed in the
Secretary of State of Delaware and become effective;
(viii) No actions, suits or proceedings of any governmental
authority or other Person relating to the transactions contemplated hereby shall
be pending or threatened;
(ix) The Company shall have entered into the Registration
Rights Agreement with the Purchasers; and
(x) The Purchasers shall have received evidence, satisfactory
to them, of the waiver by Cargill of the application of the antidilution
provision of the warrants issued to it with respect of the issuance and exercise
of the Convertible Preferred Stock.
8
6. INDEMNIFICATION.
(a) The Company shall indemnify and hold harmless the Purchasers from
and against any and all loss, damage, liability, or expense including costs and
reasonable attorneys' fees, that the foregoing may incur by reason of, or in
connection with any breach of any of its representations and warranties or any
failure on its part to fulfill any of the Company's covenants, agreements or
obligations set forth herein.
(b) The Purchasers shall indemnify and hold harmless the Company from
and against any and all loss, damage, liability, or expense including costs and
reasonable attorneys' fees, that the foregoing may incur by reason of, or in
connection with any breach of any of the respective Purchasers' representations
and warranties or any failure on the respective Purchasers' part to fulfill any
of the respective Purchasers' covenants, agreements or obligations set forth
herein.
(c) The Company shall defend, hold harmless and indemnify each
Purchaser, its respective affiliates and controlling persons and each of the
foregoings' respective shareholders, officers, directors and employees (each, an
"Indemnitee" and collectively, the "Indemnitees") from and against any and all
claims, actions, suits, judgments, demands, damages, losses, liabilities
(including liabilities for penalties), fines, amounts paid in settlement, and
all other costs or expenses of any nature or kind whatsoever, including
reasonable fees and disbursements of counsel and other professional advisers,
arising out of or resulting from any claim, action, investigation or Proceeding
(as defined in Section 12 below) in connection with or relating to the
execution, delivery or performance of this Agreement (excluding, however, any
claim to enforce the performance by such Purchaser of its express
representations, warranties or obligations under this Agreement) or the
consummation of the transactions contemplated hereby (the "Transactions ")
including, without limitation:
(i) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, to the extent of the aggregate amount paid in
settlement of any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or of any claim
whatsoever based upon any such untrue statement or omission, or any such alleged
untrue statement or omission; provided that (subject to Section 10 below) any
such settlement is effected with the written consent of the Company; and
(ii) against any and all expense whatsoever, as incurred,
including the fees and disbursements of counsel and other professional advisers
chosen by the Purchasers, reasonably incurred in investigating, preparing or
defending against any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or any claim whatsoever
based upon any such untrue statement or omission, or any such alleged untrue
statement or omission, to the extent that any such expense is not paid under any
of the foregoing provisions of this Section 6(c).
(collectively, all such amounts are herein called "Losses").
9
(d) In furtherance of the foregoing indemnification and without
limiting the generality thereof, each Indemnitee shall be entitled to the rights
of indemnification provided in Section 6(c) if such Indemnitee is, or is
threatened to be made, a party to or participant in any Proceeding. Pursuant to
this Section 6(d), each Indemnitee shall be indemnified by the Company against
all Losses arising in connection with such Proceeding.
7. INDEMNIFICATION FOR EXPENSES OF INDEMNITEE AS A WITNESS.
Notwithstanding any other provision of this Agreement, to the extent
that any Indemnitee is a witness in any Proceeding, such Indemnitee shall be
indemnified against all Losses incurred by it or on its behalf in connection
with its service as a witness.
8. ADVANCEMENT OF EXPENSES.
Notwithstanding any other provision of this Agreement, the Company
shall advance all expenses incurred by or on behalf of any Indemnitee in
connection with any Proceeding within ten days after the receipt by the Company
of a statement from such Indemnitee requesting such advance or advances from
time to time, whether prior to or after final disposition of such Proceeding.
Each such statement shall reasonably evidence expenses addressed therein. Any
advances pursuant to this Section 8 shall be unsecured and interest free. Each
Purchaser hereby agrees to repay any amount so advanced if and to the extent
that it shall ultimately be determined that any Indemnitee affiliated with such
Purchaser was not entitled to indemnification or contribution with respect to
such matter.
9. ACTIONS AGAINST PARTIES; NOTIFICATION.
Each Indemnitee shall give notice as promptly as reasonably practicable
to the Company of any action commenced against it in respect of which indemnity
may be sought hereunder, but failure to so notify the Company shall not relieve
the Company from any liability hereunder to the extent it is not materially
prejudiced as a result thereof and in any event shall not relieve it from any
liability which it may have otherwise than on account of this Agreement. Counsel
to the Indemnitee shall be selected by the Company, and shall be reasonably
acceptable to the relevant Purchaser. The relevant Purchaser may participate at
its own expense in the defense of any such action. In no event shall the Company
be liable for fees and expenses of more than one counsel (in addition to any
local counsel) separate from its own counsel for all Indemnitees in connection
with any one action or separate but similar or related actions in the same
jurisdiction arising out of the same general allegations or circumstances. The
Company shall not, without the prior written consent of the Purchasers, settle
or compromise or consent to the entry of any judgment with respect to any
litigation, or any investigation or proceeding by any governmental agency or
body, commenced or threatened, or any claim whatsoever in respect of which
indemnification could be sought under Section 6 hereof (whether or not the
Indemnitees are actual or potential parties thereto), unless such settlement,
compromise or consent (i) includes an unconditional release of each Indemnitee
from all liability arising out of such litigation, investigation, proceeding or
claim and (ii) does not include a statement as to or an admission of fault,
culpability or a
10
failure to act by or on behalf of any Indemnitee.
10. SETTLEMENT WITHOUT CONSENT IF FAILURE TO REIMBURSE.
Subject to the provisions of Section 8, if at any time an Indemnitee
shall have requested the Company to reimburse the Indemnitee for fees and
expenses of counsel, the Company agrees that it shall be liable for any
settlement of the nature contemplated by Section 9 effected without its written
consent if (i) such settlement is entered into more than 45 days after receipt
by the Company of the aforesaid request, (ii) the Company shall have received
notice of the terms of such settlement at least 30 days prior to such settlement
being entered into, and (iii) the Company shall not have reimbursed such
Indemnitee in accordance with such request prior to the date of such settlement.
11. NON-EXCLUSIVITY; SURVIVAL OF RIGHTS; SUBROGATION.
(a) The rights of indemnification as provided by this Agreement shall
not be deemed exclusive of any other rights to which Indemnitees may at any time
be entitled under applicable law, the Certificate of Incorporation of the
Company, the Bylaws of the Company, any other agreement, a vote of shareholders
or a resolution of directors, or otherwise. No amendment or termination of this
Agreement or of any provision hereof shall limit or restrict any right of an
Indemnitee under this Agreement in respect of any action taken or omitted by
such Indemnitee prior to such amendment or termination. No right or remedy
herein conferred is intended to be exclusive of any other right or remedy, and
every other right and remedy shall be cumulative and in addition to every other
right and remedy given hereunder or now or hereafter existing at law or in
equity or otherwise. The assertion or employment of any right or remedy
hereunder, or otherwise, shall not prevent the concurrent assertion or
employment of any other right or remedy.
(b) Upon payment in full of all Losses in respect of any matter that is
the subject of indemnification under this Agreement, the Company shall be
subrogated to the extent of such payment to all of the rights of recovery of
Indemnitees against third parties, who shall execute all papers required and
take all action, at the Company's request and expense, necessary to secure such
rights, including execution of such documents as are necessary to enable the
Company to bring suit to enforce such rights.
12. DEFINITION.
(i) "Business Day" means any day other than a Saturday, a
Sunday or a day on which banking institutions in New York, New York are
authorized or required by law to be closed.
(ii) "Person" means any individual, corporation, company,
association, partnership, limited liability company, joint venture, trust,
unincorporated organization or government or other entity.
(iii) "Proceeding" includes any threatened, pending or
completed action, suit, arbitration, alternate dispute resolution mechanism,
investigation, inquiry,
11
administrative hearing or any other actual, threatened or completed proceeding,
whether brought by or in the right of the Company or otherwise and whether
civil, criminal administrative or investigative, in which any Indemnitee was, is
or will be involved as a party or otherwise, arising out of or in connection
with the execution, delivery or performance of any of the this Agreement or the
consummation of the transaction contemplated hereby.
13. TERMINATION.
Notwithstanding any other provision of this Agreement, this Agreement
shall terminate upon the occurrence of one of the following events:
(a) at any time upon the mutual written agreement of all parties; or
(b) by any party if the Transactions are not consummated by February
22, 2002, other than as a result of the breach of this Agreement by the party
seeking to terminate this Agreement.
14. ATTORNEYS' FEES.
If any Proceeding is brought for the enforcement of this Agreement, or
because of an alleged dispute, breach, default, or misrepresentation in
connection with any of the provisions of this Agreement, the successful or
prevailing party or parties shall be entitled to recover, without duplication of
anything provided for elsewhere herein, reasonable attorneys' fees and other
costs incurred in that action or proceeding, in addition to any other relief to
which it may be entitled.
15. SUCCESSORS AND ASSIGNS.
Except as expressly provided in Sections 6, 7, 8, 9, 10, and 11 hereof,
nothing in this Agreement, express or implied, is intended to confer upon any
party other than the signatories hereto any rights, remedies, obligations, or
liabilities under or by reason of this Agreement. This Agreement shall be
binding on the parties hereto and their respective successors and permitted
assigns. The rights and obligations of the parties hereunder shall not be
assignable without the prior written consent of the other parties hereto and any
attempt so to assign such rights or obligations without such consent shall be
void and of no effect, provided, that a Purchaser may assign its rights
hereunder to any majority-owned subsidiary of such Purchaser, but shall not
thereby be released from its obligations hereunder.
16. EXPENSES.
The Company shall pay or reimburse the Purchasers for their reasonable
out-of-pocket costs and expenses (including the reasonable fees and expenses of
counsel) incurred in connection with the preparation and negotiation of this
Agreement and the consummation of the transactions contemplated hereby (other
than the Purchase Price for the purchase of the Purchaser Shares).
12
17. GOVERNING LAW.
This Agreement shall be governed by and construed under the law of the
State of New York, disregarding any principles of conflicts of law that would
otherwise provide for the application of the substantive law of another
jurisdiction.
18. COUNTERPARTS.
This Agreement may be executed at different times and in one or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
19. TITLES AND SUBTITLES.
The titles and subtitles used in this Agreement are used for
convenience only and are not to be considered in construing or interpreting this
Agreement.
20. NOTICES.
All communications hereunder shall be in writing and, if to the
Company, shall be mailed, delivered or telecopied and confirmed to it at:
0000 Xxxxxx Xxxxx
Xxx Xxxxx, Xxxxxxxxxx 00000
Attention: Xxxxx X. Xxxxxxx, Chief Financial Officer
cc: Xxxxx X. Xxxxxx, General Counsel
Facsimile No.: (000) 000-0000
with a copy to:
Xxxxx & Xxxxxx L.L.P.
Xxx Xxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxx 00000
Attention: Xxxxxx X. Xxxxxxx, Esq.
Facsimile No.: (000) 000-0000
and to:
Fulbright & Xxxxxxxx L.L.P.
000 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxxx X. Xxxxxxxx, Esq.
Facsimile No.: (000) 000-0000
And if to the Purchasers, shall be mailed, delivered or telecopied and confirm
to them at the address provided in Schedule D hereto with a copy to:
00
Xxxxxxxxx & Xxxxxxxx
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx Xxxxxx, Esq.
Facsimile No.: (000) 000-0000
and to:
Triarc Companies, Inc.
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: General Counsel
Facsimile No.: (000) 000-0000
21. ENTIRE AGREEMENT; AMENDMENTS AND WAIVERS.
This Agreement constitutes the full and entire understanding and
agreement between the parties with regard to the subjects hereof. Any term of
this Agreement may be amended, and the observance of any term of this Agreement
may be waived (either generally or in a particular instance and either
retroactively or prospectively), only with the written consent of each of the
parties; provided that no amendment, modification or supplement to this
Agreement, or any decision in respect of this Agreement by the Company, shall be
effective unless approved by a majority of the directors then serving on the
Board of Directors who have not been, are not then, and are not anticipated to
be affiliated in any manner, whether as an employee, officer, director,
stockholder, owner, consultant, agent, counsel or otherwise (a "representative")
to, of or with any holder of the Convertible Preferred Stock.
22. SEVERABILITY.
If one or more provisions of this Agreement are held to be
unenforceable under applicable law, such provision shall be excluded from this
Agreement, and the balance of the Agreement shall be interpreted as if such
provision was so excluded and shall be enforceable in accordance with its terms.
In addition, if any such provision, or any part thereof, is held to be
unenforceable, the parties agree that the court, regulatory agency or other
governmental body making such determination shall have the power to delete or
add specific words or phrases, so that such provision shall then be enforceable
to the fullest extent permitted by law.
[THE REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]
14
IN WITNESS WHEREOF, and intending to be legally bound thereby, each of
the Purchasers and the Company has signed or caused to be signed its name as of
the day and year first above written.
COMPANY:
MCM CAPITAL GROUP, INC.
By: /s/ Xxxx X. Xxxxxxx, III
----------------------------------------
Name: Xxxx X. Xxxxxxx, III
Its: President and CEO
PURCHASERS:
MADISON WEST ASSOCIATES CORP.
By: /s/ Xxxxxxx X. XxXxxxxx
----------------------------------------
Name: Xxxxxxx X. XxXxxxxx
Its: Senior Vice President and CFO
C.P. INTERNATIONAL INVESTMENTS LTD.
By: /s/ Xxxxx Xxxxxxx
----------------------------------------
Name: Xxxxx Xxxxxxx
Its: Director
XXXXXX XXXXXXX XXXXX
/s/ Neville Xxxx Xxxx
-------------------------------------------
Signed by Neville Xxxx Xxxx, Power of
Attorney for Xxxxxx Xxxxxxx Xxxxx
THE XXXXX FAMILY LIMITED PARTNERSHIP
By: /s/ Xxxxxx Xxxxx
----------------------------------------
Name: Xxxxxx Xxxxx
Title: General Partner
XXXXXXXX X. MAY 1998 TRUST
By: /s/ Xxxxx X. May
----------------------------------------
Name: Xxxxx X. May
Title: Co-Trustee
15
XXXXXX X. MAY 1998 TRUST
By: /s/ Xxxxx X. May
----------------------------------------
Name: Xxxxx X. May
Title: Co-Trustee
XXXX X. XXXXX
/s/ Xxxx X. Xxxxx
-------------------------------------------
XXXX X. XXXXXX, XX.
/s/ Xxxx X. Xxxxxx, Xx.
-------------------------------------------
XXXXXXX XXXXXX
/s/ Xxxxxxx Xxxxxx
-------------------------------------------
XXXXX X. XXXXXX
/s/ Xxxxx X. Xxxxxx
-------------------------------------------
XXXXXX X. XXXXX
/s/ Xxxxxx X. Xxxxx
-------------------------------------------
XXXX XXXXXX
/s/ Xxxx Xxxxxx
-------------------------------------------
16
