Exhibit 99.5
XXXXXXX PRG LIQUIDATING INVESTMENTS, LTD
Secured Promissory Note due [170 days from Closing]
$12,610,584.96 August __, 2002
FOR VALUE RECEIVED, the undersigned Xxxxxxx PRG Liquidating
Investments, Ltd., a Texas limited partnership (the "BORROWER"), hereby promises
to pay to Berkshire Fund V, Limited Partnership, a Massachusetts limited
partnership (or its permitted assignees, collectively, "BERKSHIRE") at the
address specified in Section 8.3 hereof, or at such other place as Berkshire
shall from time to time have designated to Borrower in writing, on or before
[170 days from Closing of the Stock Purchase Agreement] (the "STATED MATURITY
DATE"), the amount of Twelve million six hundred and ten thousand five hundred
and eighty four dollars and ninety six cents ($12,610,584.96) (the "PRINCIPAL
AMOUNT"), in cash on the terms and conditions set forth in Article 3 hereof, and
with interest as provided in Article 2 hereof. Berkshire and Xxxxxxxx also
hereby agree to the put and call of the shares of common stock, no par value,
(the "COMMON STOCK") of PRG-Xxxxxxx International, Inc., a Georgia corporation
("PRG") on the terms and conditions set forth in Article 5 hereof.
ARTICLE I
GENERAL
1.1. THE NOTE. This Note is as contemplated by the Stock Purchase
Agreement, dated as of August 16, 2002, among the Borrower, Berkshire and
certain other parties thereto (the "STOCK PURCHASE AGREEMENT"), the First Option
Agreement, dated as of August __, 2002, among the Borrower and PRG (the "OPTION
AGREEMENT") and the Subordination Agreement, dated as of August __, 2002, among
the Borrower, Berkshire and PRG (the "SUBORDINATION AGREEMENT"). Terms defined
in the Stock Purchase Agreement and the Option Agreement and not otherwise
defined herein are used herein as so defined in those agreements.
1.2. ACCELERATION. In case an Event of Default (as defined in
Section 7.1 hereof) shall occur, the entire Principal Amount of this Note may
become or be declared to be due and payable in the manner and with the effect
provided herein.
ARTICLE II
INTEREST
2.1. INTEREST. This Note shall accrue daily interest from the date
hereof on the Principal Amount from time to time unpaid at a rate of eight
percent (8%) per annum, said interest being payable upon any prepayment, at the
Stated Maturity Date or any accelerated maturity hereof.
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2.2. MANNER OF PAYMENT. All interest on the Principal Amount shall
be payable in cash, unless otherwise provided for herein.
ARTICLE III
PAYMENT OF PRINCIPAL AMOUNT
3.1. PAYMENTS. The outstanding Principal Amount of this Note will
be payable on the Stated Maturity Date in cash, unless and to the extent
otherwise provided in this Section 3.1 or Article 5 hereof.
3.1.1. FULL EXERCISE OF OPTIONS. Within five (5) days of the
notice of exercise in full of the options granted pursuant to the
Option Agreement (the "OPTIONS") by PRG and, in any event, no later
than simultaneously with the Option Closing, the Borrower will repay
the entire Principal Amount (plus accrued interest pursuant to Section
2.1 hereof) in cash on such date, and on such date Berkshire will
release the shares of common stock of PRG (the "PLEDGED SHARES") which
are the subject of the Pledge Agreement dated as of August __, 2002 and
between the parties to this Note, in the form attached as Exhibit A
hereto (the "PLEDGE AGREEMENT"), to Borrower pursuant to Article IV of
the Pledge Agreement.
3.1.2. PARTIAL EXERCISE AND NON-EXERCISE OF OPTIONS.
(a) Within five (5) days of the notice of
exercise and, in any event, no later than simultaneously with
and in the same amount as the payment by PRG under the Option
Agreement for a portion of the Pledged Shares, the Borrower
will repay to Berkshire the portion of the Principal Amount
relating to the number of Pledged Shares sought to be released
to the Borrower (plus accrued interest pursuant to Section 2.1
hereof) in cash on such date (a "SETTLEMENT DATE"), and
Berkshire will release on the Settlement Date pursuant to
Article IV of the Pledge Agreement such number of Pledged
Shares as Borrower is required to deliver to PRG pursuant to
the exercise of the Options.
(b) To the extent the Options are not exercised
by the date of expiration thereof and on such date any unpaid
Principal Amount remains outstanding, the provisions of
Article 5 hereof will apply.
3.2. NOTICES; DOCUMENTS. For the purpose of verifying and
calculating the payments due pursuant to Section 3.1 and Article 5 hereof and as
a condition to the release of any Pledged Shares pursuant to Article IV of the
Pledge Agreement, the Borrower agrees to provide copies of all documents
relating to the exercise of the Options to Berkshire, pursuant to the provisions
of Section 8.3 hereof, upon the date of any exercise of the Options.
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ARTICLE IV
COVENANTS
4.1. This Note and the obligations hereunder are secured by the
1,446,168 Pledged Shares in accordance with the Pledge Agreement.
4.2. Borrower shall at all times, until this Note is indefeasibly
paid in full, hold 1,000,000 shares of Common Stock of PRG, free and clear of
any liens or other encumbrances.
ARTICLE V
5.1. BERKSHIRE CALL OPTION. For a period of five (5) days after the
expiration of the Option Agreement (the "CALL PERIOD") or, subject to the
Subordination Agreement in case of an acceleration hereunder, Berkshire will
have the right to purchase from Borrower the number of Pledged Shares remaining
under the Pledge Agreement (the "BERKSHIRE OPTION"), for a price equal to $9.05
per share (the "EXERCISE PRICE"). The Berkshire Option may be exercised by
Berkshire, only for the entire number of Pledged Shares remaining under the
Pledge Agreement, on any business day on or prior to the last day of the Call
Period, by notice of exercise in accordance with Section 8.3, in substantially
the form attached hereto as Exhibit B (or a reasonable facsimile thereof) duly
executed by Berkshire and accompanied by payment, in cash or wire transfer of
immediately available funds, or by offset of amounts then due by Borrower under
this Note, in the amount obtained by multiplying (a) the number of Pledged
Shares designated in such notice by (b) the Exercise Price, and Borrower shall
thereupon transfer the number of Pledged Shares purchased pursuant to the
Berkshire Option to Berkshire.
5.2. BORROWER PUT OPTION. If the Berkshire Option is not exercised
by the end of the Call Period, for a period of five (5) days thereafter (the
"PUT PERIOD") or, subject to the Subordination Agreement in case of an
acceleration hereunder or in the case of an Event of Default after 179 days,
Borrower will have the right to sell the number of Pledged Shares remaining
under the Pledge Agreement (the "BORROWER PUT"), to Berkshire at the Exercise
Price. The Borrower Put may be exercised by Xxxxxxxx, only for the entire number
of Pledged Shares remaining under the Pledge Agreement, on any business day on
or prior to the last day of the Put Period, by notice of exercise in accordance
with Section 8.3, in substantially the form attached hereto as Exhibit C (or a
reasonable facsimile thereof) duly executed by Borrower and accompanied by
instructions to release the number of Pledged Shares purchased by Berkshire
pursuant to the Borrower Put to Berkshire in return for payment, in cash or wire
transfer of immediately available funds, or by offset of amounts then due by
Borrower under this Note, in the amount obtained by multiplying (a) the number
of Pledged Shares designated in such notice by (b) the Exercise Price.
5.3. CASH PAYMENT. In the event neither the Berkshire Option nor
the Borrower Put is exercised, the Note shall be due and payable in cash on the
Stated Maturity Date.
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ARTICLE VI
REPRESENTATIONS AND WARRANTIES OF THE BORROWER
The Borrower represents and warrants to Berkshire as follows:
6.1. AUTHORIZATION; BINDING OBLIGATION. This Note has been duly and
validly executed and delivered by the Borrower and constitutes a legal, valid
and binding obligation of the Borrower, enforceable against the Borrower in
accordance with its terms, except as such enforcement may be limited by
bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance and
other federal or state laws of general applicability relating to or affecting
creditors' or secured parties' rights and remedies generally and general
principles of equity, whether considered in an action at law or in equity. The
Borrower has the legal capacity and all requisite power and authority to execute
and deliver this Note and to consummate the transactions contemplated hereby and
to perform its obligations hereunder. Such execution, delivery and consummation
has been duly and validly authorized by all necessary action on the part of the
Borrower, and no other corporate or other proceedings on the part of the
Borrower are necessary to authorize such execution, delivery and consummation.
6.2. TITLE TO THE PLEDGED SHARES. Immediately prior to the pledge
of the Pledged Shares, the Borrower was the record and beneficial owner of, and
had good and marketable title to, the Pledged Shares free and clear of all
Encumbrances. The Pledged Shares owned by the Borrower are validly issued, duly
authorized and free of any preemptive rights. There are no voting trusts or
other agreements or understandings to which the Borrower is a party with respect
to the voting of the Pledged Shares. The Pledged Shares are not subject to any
restrictions on transferability other than those imposed by the Securities Act
and applicable state securities laws. Except for the Option Agreement, there are
no options, warrants, calls, commitments or rights of any character to purchase
or otherwise acquire the Pledged Shares from the Borrower pursuant to which the
Borrower may be obligated to sell, transfer or otherwise dispose of any of the
Pledged Shares. Subject to the Subordination Agreement, in the event that (i)
the Pledgor defaults under this Note and Berkshire enforces the provisions of
the Pledge Agreement or (ii) the provisions of Article 5 hereof apply, Berkshire
will acquire good and marketable title to the Pledged Shares, free and clear of
all Encumbrances.
6.3. CONSENTS AND APPROVALS; NO VIOLATION. None of the execution
and delivery of this Note, the consummation of the transactions contemplated
hereby, or compliance with any of the provisions hereof, will (i) require any
consent, waiver, approval, authorization or permit of, or filing with or
notification to, or any other action by, any Governmental Authority by the
Borrower, other than necessary filings on Form 4 with the Commission, (ii)
violate the certificate of formation or operating agreement of the Borrower, or
any Law of any Governmental Authority which may be applicable to the Borrower,
or by which any of the Borrower's activities, properties or assets (including,
without limitation the Pledged Shares) may be bound or affected or (iii)
violate, breach, or conflict with, or constitute (with or without due notice or
lapse of time or both) a default (or give rise to any right of termination,
cancellation or acceleration or any obligation to pay or result in the
imposition of any Encumbrance upon any of the property of the Borrower
(including, without limitation, the Pledged Shares)) under, any of
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the terms, conditions or provisions of any note, bond, mortgage, indenture,
Encumbrance, contract, agreement, or other instrument or obligation to which the
Borrower is a party or by which any of the Borrower's activities, properties or
assets (including, without limitation, the Pledged Shares) may be bound or
affected.
ARTICLE VII
EVENTS OF DEFAULT
7.1. EVENTS OF DEFAULT; REMEDIES. If any of the following events
(each such event herein termed an "Event of Default") shall happen, that is to
say:
7.1.1. the Borrower shall fail to make any payment of
Principal Amount of this Note when due, whether at maturity by
acceleration or otherwise;
7.1.2. the Borrower shall fail to perform or observe any of
the other covenants, agreements or provisions set forth herein or in
the Option Agreement, Stock Purchase Agreement or Pledge Agreement; or
7.1.3. The Borrower shall:
(a) commence a voluntary case under Title 11 of
the United States Code as from time to time in effect, or
authorize, by appropriate proceedings of its board of managers
or other governing body, the commencement of such a voluntary
case;
(b) have filed against it a petition under said
Title 11 which shall not have been dismissed within 30 days
after the date on which said petition is filed, or file an
answer or other pleading within said 30-day period admitting
or failing to deny the material allegations of such a
petition, or seeking, consenting to or acquiescing in the
relief therein provided, or fail to controvert timely the
material allegations of any such petition;
(c) have entered against it an order for relief
in any involuntary case commenced under said Title 11;
(d) seek relief as a debtor under any applicable
law, other than said Title 11, of any jurisdiction relating to
the liquidation or reorganization of debtors or to the
modification or alteration of the rights of creditors, or
consent to or acquiesce in such relief;
(e) have entered against it any order by a court
of competent jurisdiction (i) finding it to be bankrupt or
insolvent, (ii) ordering or approving its liquidation,
reorganization or any modification or alteration of the rights
of its creditors or (iii) assuming custody of, or appointing a
receiver or other custodian for, all or a substantial part of
its property; or
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(f) make an assignment for the benefit of, or
enter into a composition with, its creditors or appoint or
consent to the appointment of a receiver or other custodian
for all or a substantial part of its property.
then and in each and every such case, Berkshire shall notify the Borrower of
such Event of Default and, in the event such Event of Default is not cured by
Borrower within thirty (30) days of the date of such notice, Berkshire may
declare all or any part of the unpaid Principal Amount to be forthwith due and
payable (unless there shall have occurred an Event of Default under Section
7.1.3 hereof, in which case the unpaid balance of this Note shall automatically
become due and payable), and thereupon such unpaid Principal Amount or part
thereof, together with interest accrued thereon and all other sums, if any,
payable under this Note, shall become so due and payable without presentation,
presentment, protest or further demand or notice of any kind, all of which are
hereby expressly waived to the extent not prohibited by applicable law that
cannot be waived, and Berkshire, subject to the Subordination Agreement, may
proceed to enforce payment of such amount or part thereof in such manner as it
or they may elect, including the transfer the Pledged Shares to its own account,
with the Principal Amount and interest due under this Note being reduced by the
amount equal to (i) the number of Pledged Shares transferred to Berkshire,
multiplied by (ii) the Exercise Price, and if additional Principal Amount and
interest remain outstanding under this Note, Berkshire may proceed to protect
and enforce its or their rights by suit in equity, action at law and/or other
appropriate proceeding either for specific performance of any covenant,
provision or condition contained or incorporated by reference in this Note or
the Pledge Agreement, or in aid of the exercise of any power granted in this
Note or the Pledge Agreement; PROVIDED; HOWEVER, that it is agreed and
acknowledged that Berkshire's recourse hereunder shall be limited to the Pledged
Shares and after 179 days Borrower may only cure such default by exercise of the
Borrower Put right referred to in Section 5.2 hereof.
7.2. ANNULMENT OF DEFAULTS. An Event of Default shall not be deemed
to be in existence for any purpose of this Note if Berkshire shall have waived
such event in writing or stated in writing that the same has been cured to its
or their reasonable satisfaction. No waiver or statement of satisfactory cure
pursuant to this Section 7.2 shall extend to or affect any subsequent or other
Event of Default not specifically identified in such waiver or statement of
satisfactory cure or impair any of the rights of Berkshire upon the occurrence
thereof.
7.3. WAIVERS. The Borrower hereby waives to the extent not
prohibited by provisions of applicable law which cannot be waived (a) all
presentments, demands for performance and notices of nonperformance (except to
the extent specifically required by the provisions hereof), (b) any requirement
of diligence or promptness on the part of Berkshire in the enforcement of its
rights under the provisions of this Note or the Pledge Agreement, (c) any and
all notices of every kind and description which may be required to be given by
any legal requirement, and (d) any defense of any kind (other than payment)
which it may now or hereafter have with respect to its obligations and liability
under this Note, the Option Agreement or the Pledge Agreement.
7.4. COURSE OF DEALING. No course of dealing between the Borrower
on the one hand, and Berkshire on the other hand, shall operate as a waiver of
the parties' rights under this Note or the Pledge Agreement. No delay or
omission in exercising any right under this Note or the
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Pledge Agreement shall operate as a waiver of such right or any other right. A
waiver on any one occasion shall not be construed as a waiver of or bar to any
right or remedy on any other occasion. No waiver or statement of satisfactory
cure or consent shall be binding upon Berkshire unless it is in writing and
signed by Berkshire as may be required by the provisions of this Note.
ARTICLE VIII
MISCELLANEOUS
8.1. SURVIVAL OF REPRESENTATION AND WARRANTIES. All
representations, warranties and covenants made by the Borrower, in connection
with the transactions contemplated by this Note shall survive the pledge of the
Pledged Shares, and transfer of ownership of the same to Berkshire under Article
5 or Section 7.1 hereof, or the provisions of the Pledge Agreement.
8.2. GOVERNING LAW. THIS NOTE SHALL BE CONSTRUED AND ENFORCED IN
ACCORDANCE WITH, AND THE RIGHTS OF THE PARTIES SHALL BE GOVERNED BY, THE LAWS OF
THE STATE OF DELAWARE, WITHOUT REGARD TO PRINCIPLES OF CONFLICT OF LAWS.
8.3. NOTICES. All notices, requests, claims, demands and other
communications hereunder shall be in writing and shall be deemed to have been
duly given if delivered personally, telecopied (with confirmation of receipt),
delivered by nationally-recognized overnight express service or sent by
registered or certified mail (postage prepaid, return receipt requested) to the
parties at the following addresses:
8.3.1. If to Berkshire, to:
Berkshire Partners LLC
Xxx Xxxxxx Xxxxx
Xxxxxx, XX 02108-4401
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
Attention: Xxxx X. Xxxxx
With a copy to:
Ropes & Gray
Xxx Xxxxxxxxxxxxx Xxxxx
Xxxxxx, XX 00000
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
Attention: Xxxxx X. Xxxxxx, Esq.
Xxxx X. Xxxxxxxxx, Esq.
8.3.2. If to the Borrower, to:
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Xxxxxxx PRG Liquidating Investments, Ltd.
0000 XXX Xxxxxxx, Xxxxx 000
Xxxxxx, XX 00000
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
Attention: Xxxxxx X. Xxxxxxx
Xxxxxx X. Xxxxxxx
With a copy to:
Xxxxxx, Xxxxx, Xxxxxxx & Xxxxxxx
600 Preston Commons East
0000 Xxxxxxx Xxxx
Xxxxxx, XX 00000
Telephone: (000) 000-0000 (direct dial)
Telecopy: (000) 000-0000 (direct fax)
Attention: Xxxxxx Xxxxxx, Esq.
Xxxxxx X. Xxxxxxx, Esq.
Xxxx X. Xxxxx, Esq.
or to such other address as the person to whom notice is to be given may have
previously furnished to the other in writing in the manner set forth above,
provided that notice of a change of address shall be deemed given only upon
receipt.
8.4. EXPENSES. Each party hereto shall be solely responsible for
all expenses incurred by it or on its behalf in connection with the preparation
and execution of this Note and the consummation of the transactions contemplated
hereby, including, without limitation, the fees and expenses of its counsel,
accountants, brokers, finders, financial advisors and other representatives.
8.5. SPECIFIC PERFORMANCE. Without limiting the rights of each
party hereto to pursue all other legal and equitable rights available to such
party for the other parties' failure to perform their obligations under this
Note, the parties hereto acknowledge and agree that the remedy at law for any
failure to perform their obligations hereunder would be inadequate and that each
of them, respectively, shall be entitled to specific performance, injunctive
relief or other equitable remedies in the event of any such failure.
8.6. DESCRIPTIVE HEADINGS; INTERPRETATION. The headings contained
in this Note are for reference purposes only and shall not affect in any way the
meaning or interpretation of this Note. References in this Note to Sections mean
Sections of this Note, unless otherwise indicated. The term "person" shall mean
and include an individual, a partnership, a joint venture, a corporation, a
trust, a governmental entity or an unincorporated organization. The parties
hereto agree that they have been represented by counsel during the negotiation
and execution of this Note and, therefore, waive the application of any law,
regulation, holding or rule of construction providing that ambiguities in a
document will be construed against the party drafting the document.
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8.7. COUNTERPARTS. This Note may be executed in any number of
counterparts, each of which shall be an original, but all of which together
shall constitute one instrument.
8.8. SEVERABILITY. In the event that any one or more of the
provisions contained herein, or the application thereof in any circumstances, is
held invalid, illegal or unenforceable in any respect for any reason, the
parties shall negotiate in good faith with a view to the substitution therefor
of a suitable and equitable solution in order to carry out, so far as may be
valid and enforceable, the intent and purpose of such invalid provision,
provided, however, that the validity, legality and enforceability of any such
provision in every other respect and of the remaining provisions contained
herein shall not be in any way impaired thereby, it being intended that all of
the rights and privileges of the parties hereto shall be enforceable to the
fullest extent permitted by law.
8.9. ENTIRE AGREEMENT; THIRD-PARTY BENEFICIARIES. This Note
constitutes the entire agreement among the parties with respect to the subject
matter hereof and supersedes all prior agreements and understandings, both
written and oral, among the parties with respect to the subject matter hereof,
and is not intended to confer upon any person other than the parties hereto and
their permitted assigns any rights or remedies hereunder.
8.10. ASSIGNMENT. No party hereto may assign its rights or
obligations under this Note, PROVIDED, THAT Berkshire may assign and transfer
this Note and its rights hereunder to any one or more of its affiliates, and may
assign and transfer any Pledged Shares obtained hereunder to any one or more of
such affiliates.
8.11. FURTHER ASSURANCES. The Borrower and Berkshire agree to
execute and deliver such other documents, certificates, agreements and other
writings and to take such other actions as may be necessary or desirable in
order to implement the transactions contemplated by this Note.
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The undersigned has caused this Note to be executed and delivered by
its duly authorized officer as of the date first written above.
XXXXXXX PRG LIQUIDATING INVESTMENTS, LTD.,
a Texas limited partnership
By: Xxxxxxx PRG Liquidating Investments GP,
L.L.C., a Texas limited liability company
By:
---------------------------------------
Name: Xxxxxx Xxxxxxx
Title: Manager/President
BERKSHIRE FUND V, LIMITED PARTNERSHIP
By: Fifth Berkshire Associates LLC
its General Partner
By:
---------------------------------------
Name:
Title:
EXHIBIT A
PLEDGE AGREEMENT
