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EXECUTION COPY
OPTION EXERCISE/CANCELLATION AGREEMENT
THIS OPTION EXERCISE/CANCELLATION AGREEMENT (this "Agreement"), is
dated as of April 13, 2000, by and among PlayCore, Inc., a Delaware corporation
(the "Company"), Jasdrew Acquisition Corp., a Delaware corporation
("Acquisition Company"), and __________________, a current director, officer or
key employee of the Company or one of its subsidiaries ("Optionee").
WHEREAS, the Company has entered into an Agreement and Plan of Merger
(the "Merger Agreement"), dated as of April __, 2000, by and among the Company,
Acquisition Company and PlayCore Holdings, Inc., a Delaware corporation
("Parent"), pursuant to which (i) Acquisition Company and the Company, among
others, have agreed to make a joint tender offer (the "Offer") for all of the
outstanding common stock, $0.01 par value, of the Company ("Shares"), and (ii)
after consummation of the Offer, Acquisition Company will be merged with and
into the Company (the "Merger").
WHEREAS, pursuant to one or both of the Company's 1992 Stock Program
and the Company's 1996 Incentive Stock Plan (collectively, the "Plans"),
Optionee has been granted certain stock options to purchase Shares (the
"Options").
WHEREAS, as a condition to Acquisition Company and Parent entering
into the Merger Agreement, the Company has agreed to cause Optionee to enter
into this Agreement, pursuant to which the Optionee agrees that (i) upon
consummation of the Offer, if requested by Acquisition Company, Optionee will
exercise Optionee's Options that have a per Share exercise price (the "Exercise
Price") less than the price per Share paid in the Offer ("In-the-Money
Options") and sell to Acquisition Company the Option Shares that are issued to
Optionee upon the exercise of such In-the-Money Options (the "Exercised
Shares"), (ii) upon consummation of the Merger, the Company will cancel all of
the Optionee's Options that are not In-the-Money Options ("Out-of-the-Money
Options"), and cancel all the In-the-Money Options not exercised by Optionee
for the consideration provided in Section 2 below and (iii) he will tender any
Shares (other than the Exercised Shares) in the Offer as provided in Section 4
below.
WHEREAS, on the date hereof Optionee has entered into a Severance,
Change of Control and Non-Competition Agreement ("Severance Agreement") with
Acquisition Company, and acknowledges that, as a condition to Acquisition
Company entering into the Severance Agreement, Acquisition Company has required
Optionee to enter into this Agreement and further acknowledges that the
consideration to be received by Optionee under the Severance Agreement
constitutes, in part, consideration for the cancellation of the
Out-of-the-Money Options.
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NOW, THEREFORE, in consideration of the foregoing, the agreements set
forth herein and the mutual benefits to be gained by the performance thereof,
the Company, Acquisition Company and Optionee hereby agree as follows:
1. Exercise of In-the-Money Options. The Optionee agrees that, upon
the consummation of the Offer and request by Acquisition Company, and provided
that Acquisition Company holds at least a majority of the outstanding Shares at
the time of such request, the Optionee shall (i) immediately exercise all of
the Optionee's In-the-Money Options in accordance with the terms of the Plans
and this Agreement, by delivery of a Notice of Exercise in the form attached
hereto as Exhibit A and (ii) sell to Acquisition Company all Exercised Shares
at a price per Share equal to the price per share paid in the Offer (the "Share
Purchase Price"). The aggregate Exercise Price for the Exercised Shares shall
be paid by Optionee in the form of (i) a cash payment in the form of a check
payable to the Company in an amount equal to the product of (a) the number of
Exercised Shares and (b) the par value of such Exercised Shares (such product,
the "Cash Exercise Price") and (ii) a promissory note (the "Optionee Note") in
the form attached hereto as Exhibit B in a principal amount equal to (x) the
number of Exercised Shares multiplied by the Exercise Price minus (y) the Cash
Exercise Price. The Share Purchase Price shall be paid by Acquisition Company
by a promissory note (the "Acquisition Company Note") in the form of Exhibit C
attached hereto.
2. Cancellation of In-the-Money Options. In the event that Acquisition
Company has not requested the Optionee to exercise the Optionee's In-the-Money
Options pursuant to Section 1 above, Optionee hereby agrees that the Company
shall at the Effective Time (as defined in the Merger Agreement) cancel all of
the Optionee's In-the-Money Options in exchange for a cash payment to Optionee
in an amount equal to the product, as to each Option, of (a) the Share Purchase
Price less the Exercise Price per Share for each such Option cancelled pursuant
to this Section 2 and (b) the number of Shares subject to such Option.
3. Cancellation of Out-of-the-Money Options. In consideration of the
agreements set forth herein and without further consideration, Optionee further
agrees that upon the exercise of the In-the-Money Options pursuant to Section 1
or the cancellation of the In-the-Money Options pursuant to Section 2 above,
the Company shall cancel all of Optionee's Out-of-the-Money Options.
4. Tender of Shares. Optionee hereby agrees to validly tender (and not
to withdraw) pursuant to and in accordance with the terms of the Offer
(provided that the Offer is commenced and not amended in a manner adverse to
Optionee), not later than the Expiration Date (as defined in the Merger
Agreement), the Shares (other than Exercised Shares) owned by Optionee. Each
Optionee hereby acknowledges and agrees that the obligation of the Company or
Acquisition Company to accept for payment and pay for Shares in the Offer,
including the Optionee's Shares, is subject to the terms and conditions of the
Offer.
5. Waiver and Release.
(a) Optionee hereby acknowledges the effect of and consents
to the exercise and/or cancellation of the Options as herein provided.
Without limiting the
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generality of the foregoing, upon exercise and/or cancellation of the
Options, Optionee waives all rights and benefits associated with such
Options and relinquishes any and all claims that Optionee may have
against the Company, Acquisition Company or Parent related to such
Options or the Plans.
(b) Upon the exercise and/or cancellation of the Options,
Optionee hereby unconditionally releases and discharges the Company,
Acquisition Company and Parent and their respective directors,
officers, employees, agents and assigns from, without limitation, any
and all claims, awards, damages, obligations, promises, liabilities or
any other compensation whatsoever, arising or in any way related to
the Plans or the Options.
6. Other Covenants, Representations and Warranties of Optionee.
Optionee hereby represents, warrants and covenants to the Company and
Acquisition Company with respect to Optionee as follows:
(a) Ownership of Shares. Optionee is the beneficial owner of
the: i) Options set forth on Schedule 1 hereto, which Schedule
indicates the number of Shares into which the Options are exercisable,
the Plan under which such Options were granted, the grant date of such
Options and the Exercise Price therefor, and (ii) the Shares set forth
on Schedule 1. On the date hereof, the Options and the Shares set
forth on Schedule 1 hereto constitute all of the securities of the
Company and its subsidiaries owned of record by Optionee. Except with
respect to any applicable marital property rights, Optionee has sole
power to issue instructions with respect to the matters set forth in
this Agreement, sole power of disposition, sole power of exercise and
conversion, sole power to demand appraisal rights and sole power to
agree to all of the matters set forth in this Agreement, in each case
with respect to all of the securities set forth opposite Optionee's
name on Schedule 1 hereto, with no limitations, qualifications or
restrictions on such rights, subject to applicable securities laws,
marital property laws and the terms of this Agreement.
(b) Power; Binding Agreement. Optionee has the legal
capacity, power and authority to enter into and perform all of
Optionee's obligations under this Agreement. This Agreement has been
duly and validly executed and delivered by Optionee and constitutes a
valid and binding agreement of Optionee, enforceable against Optionee
in accordance with its terms, except as enforceability may be limited
by bankruptcy, insolvency, reorganization, moratorium or other similar
laws affecting the enforcement of creditors' rights generally and by
general equitable principles (regardless of whether such
enforceability is considered in a proceeding in equity or at law).
(c) No Conflicts. (i) No filing with, and no permit,
authorization, consent or approval of, any state or federal public
body or authority or any other person or entity is necessary for the
execution of this Agreement by Optionee and the consummation by
Optionee of the transactions contemplated hereby and (ii) none of the
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execution and delivery of this Agreement by Optionee, the consummation
by Optionee of the transactions contemplated hereby or compliance by
Optionee with any of the provisions hereof shall (A) result in a
violation or breach of, or constitute (with or without notice or lapse
of time or both) a default (or give rise to any third party right of
termination, cancellation, material modification or acceleration)
under any of the terms, conditions or provisions of any note, bond,
mortgage, indenture, license, contract, commitment, arrangement,
understanding, agreement or other instrument or obligation of any kind
to which Optionee is a party or by which Optionee or any of Optionee's
properties or assets may be bound, or (B) violate any order, writ,
injunction, decree, judgment, order, statute, rule or regulation
applicable to Optionee or any of Optionee's properties or assets.
(d) No Encumbrances. Except pursuant to this Agreement and
any applicable marital property rights, Optionee's securities and the
certificates representing such securities are now, and at all times
during the term hereof will be, held by Optionee, or by a nominee or
custodian for the benefit of Optionee, free and clear of all claims,
options, third party rights, liens, hypothecations, security
interests, proxies, voting trusts or agreements, understandings or
arrangements or any other encumbrances whatsoever.
(e) Restriction on Transfer, Proxies and Non-Interference.
Beginning on the date hereof and ending on the earlier of the
Effective Time or the Termination Date, except as required to comply
with the provisions of this Agreement, the Optionee shall not: (i)
directly or indirectly, offer for sale, sell, transfer, tender,
pledge, encumber, assign or otherwise dispose of, or enter into any
contract or option with respect to the sale, transfer, tender, pledge,
encumbrance, assignment or other disposition of, any or all of
Optionee's securities or any interest therein; (ii) grant any proxies
or powers of attorney, deposit any securities held by Optionee into a
voting trust or enter into a voting agreement with respect to any
securities; (iii) take any action that would make any representation
or warranty of Optionee contained herein untrue or incorrect or have
the effect of preventing or disabling Optionee from performing
Optionee's obligations under this Agreement; or (iv) acquire any
Company securities.
(f) Waiver of Appraisal Rights. Each Optionee hereby waives
any rights of appraisal or rights to dissent from the Merger that
Optionee may have with respect to any securities held by Optionee.
(g) Reliance by Acquisition Company. Each Optionee
understands and acknowledges that Acquisition Company is entering into
the Merger Agreement in reliance upon Optionee's execution and
delivery of this Agreement.
(h) Further Assurances. From time to time and until the
Termination Date, at any other party's request and without further
consideration, Optionee shall execute and deliver such additional
documents and take all such further lawful action as
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may be reasonably necessary or desirable to consummate and make
effective, in the most expeditious manner practicable, the
transactions contemplated by this Agreement.
7. Representations and Warranties of the Company. The Company
hereby represents and warrants to Acquisition Company and Optionee as follows:
(a) Power; Binding Agreement. The Company has the legal
capacity, power and authority to enter into and perform all of the
Company's obligations under this Agreement. The execution, delivery
and performance of this Agreement has been duly authorized by the
Company. This Agreement has been duly and validly executed and
delivered by the Company and constitutes a valid and binding agreement
of the Company, enforceable against the Company in accordance with its
terms, except as enforceability may be limited by bankruptcy,
insolvency, reorganization, moratorium or other similar laws affecting
the enforcement of creditors' rights generally and by general
equitable principles (regardless of whether such enforceability is
considered in a proceeding in equity or at law).
(b) No Conflicts. (i) No filing with, and no permit,
authorization, consent or approval of, any state or federal public
body or authority or any other person or entity is necessary for the
execution of this Agreement by the Company and the consummation by the
Company of the transactions contemplated hereby and (ii) none of the
execution and delivery of this Agreement by the Company, the
consummation by the Company of the transactions contemplated hereby or
compliance by the Company with any of the provisions hereof shall (A)
conflict with or result in any breach of any applicable organizational
documents of the Company, (B) result in a violation or breach of, or
constitute (with or without notice or lapse of time or both) a default
(or give rise to any third party right of termination, cancellation,
material modification or acceleration) under any of the terms,
conditions or provisions of any note, bond, mortgage, indenture,
license, contract, commitment, arrangement, understanding, agreement
or other instrument or obligation of any kind to which the Company is
a party or by which the Company or any of the Company's properties or
assets may be bound, or (C) violate any order, writ, injunction,
decree, judgment, order, statute, rule or regulation applicable to the
Company or any of the Company's properties or assets.
8. Other Covenants, Representations and Warranties of Acquisition
Company. Acquisition Company hereby represents and warrants to the Company and
the Optionee as follows:
(a) Power; Binding Agreement. Acquisition Company has the
legal capacity, power and authority to enter into and perform all of
Acquisition Company's obligations under this Agreement. The execution,
delivery and performance of this Agreement has been duly authorized by
Acquisition Company. This Agreement has been duly and validly executed
and delivered by Acquisition Company and constitutes a valid and
binding agreement of Acquisition Company, enforceable against
Acquisition
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Company in accordance with its terms, except as enforceability may be
limited by bankruptcy, insolvency, reorganization, moratorium or other
similar laws affecting the enforcement of creditors' rights generally
and by general equitable principles (regardless of whether such
enforceability is considered in a proceeding in equity or at law).
(b) No Conflicts. (i) No filing with, and no permit,
authorization, consent or approval of, any state or federal public
body or authority or any other person or entity is necessary for the
execution of this Agreement by Acquisition Company and the
consummation by Acquisition Company of the transactions contemplated
hereby and thereby and (ii) none of the execution and delivery of this
Agreement by Acquisition Company, the consummation by Acquisition
Company of the transactions contemplated hereby or compliance by
Acquisition Company with any of the provisions hereof shall (A)
conflict with or result in any breach of any applicable organizational
documents of Acquisition Company, (B) result in a violation or breach
of, or constitute (with or without notice or lapse of time or both) a
default (or give rise to any third party right of termination,
cancellation, material modification or acceleration) under any of the
terms, conditions or provisions of any note, bond, mortgage,
indenture, license, contract, commitment, arrangement, understanding,
agreement or other instrument or obligation of any kind to which
Acquisition Company is a party or by which Acquisition Company or any
of Acquisition Company's properties or assets may be bound, or (C)
violate any order, writ, injunction, decree, judgment, order, statute,
rule or regulation applicable to Acquisition Company or any of
Acquisition Company's properties or assets.
9. Miscellaneous.
(a) Amendment. This Agreement may not be amended except by an
instrument in writing signed by the parties hereto.
(b) Waiver. Any party hereto may (i) extend the time for or
waive compliance with the performance of any obligation or other act
of any other party hereto or (ii) waive any inaccuracy in the
representations and warranties contained herein or in any document
delivered pursuant hereto. Any such extension or waiver shall be valid
only if set forth in an instrument in writing signed by the party or
parties to be bound thereby. The failure of any party to this
Agreement to assert any of its rights under this Agreement or
otherwise shall not constitute a waiver of those rights.
(c) Notices. All notices, requests, claims, demands and other
communications hereunder shall be in writing and shall be deemed given
if delivered personally or sent by telecopy or by overnight courier
(providing proof of delivery), if to the Optionee at the address
specified on the signature pages, and if to Acquisition Company or the
Company as specified below:
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If to Acquisition Company: Chartwell Investments II LLC
000 Xxxxx Xxxxxx
00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxx X. Xxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
with a copy to: Akin, Gump, Strauss, Xxxxx
& Xxxx, L.L.P.
0000 Xxx Xxxxxxxxx Xxxxxx, X.X.
Xxxxx 000
Xxxxxxxxxx, X.X. 00000
Attention: Xxxxxxx X. Xxxxx, Xx.
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
If to the Company PlayCore, Inc.
Riverfront Center, Suite 204
00 Xxxx Xxxxxxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
Attention:
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
with a copy to: Xxxxx & Lardner
Firstar Center
000 Xxxx Xxxxxxxxx Xxxxxx
Xxxxxxxxx, XX 00000-0000
Attention: Xxxxxxxx X. Xxxxxx, III
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
or to such other address as the person to whom notice is given may have
previously furnished to the others in writing in the manner set forth above.
(d) Assignment, Binding Effect; Benefit. Neither this
Agreement nor any of the rights, interests or obligations hereunder
shall be assigned, in whole or in part, by operation of law or
otherwise, by any of the parties hereto without the prior written
consent of the other parties, except that Acquisition Company may
assign, in its discretion, any or all of its rights, interests and
obligations hereunder to Parent or any direct or indirect subsidiary
of Parent, but no such assignment shall relieve Acquisition Company of
any of its obligations hereunder. Subject to the preceding sentence,
this Agreement shall be binding upon, inure to the benefit of, and be
enforceable by, the parties hereto and their respective successors and
permitted assigns. Notwithstanding
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anything contained in this Agreement to the contrary, nothing in this
Agreement, express or implied, is intended to confer on any person other
than the parties hereto or their respective successors and permitted assigns
any rights, remedies, obligations or liabilities under or by reason of this
Agreement.
(e) Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of Delaware, without
giving effect to the principles of conflicts of laws thereof.
(f) ENFORCEMENT. THE PARTIES AGREE THAT IRREPARABLE DAMAGE
WOULD OCCUR IN THE EVENT THAT ANY OF THE PROVISIONS OF THIS AGREEMENT WERE
NOT PERFORMED IN ACCORDANCE WITH THEIR SPECIFIC TERMS OR WERE OTHERWISE
BREACHED. IT IS ACCORDINGLY AGREED THAT THE PARTIES SHALL BE ENTITLED TO AN
INJUNCTION OR INJUNCTIONS TO PREVENT BREACHES OF THIS AGREEMENT AND TO
ENFORCE SPECIFICALLY THE TERMS AND PROVISIONS OF THIS AGREEMENT IN ANY COURT
OF THE UNITED STATES OR ANY STATE HAVING JURISDICTION, THIS BEING IN
ADDITION TO ANY OTHER REMEDY TO WHICH THEY ARE ENTITLED AT LAW OR IN EQUITY.
(g) Counterparts. This Agreement may be executed and
delivered (including by facsimile transmission) in one or more counterparts,
all of which shall be considered one and the same agreement and shall become
effective when one or more counterparts have been signed by each of the
parties and delivered to the other parties, it being understood that all
parties need not sign the same counterpart.
(h) Entire Agreement. This Agreement constitutes the entire
agreement, and supersedes all prior agreements and understandings, both
written and oral, among the parties with respect to the subject matter of
this Agreement.
10. Withholding. Optionee agrees that the Company or Acquisition
Company may withhold from amounts paid to Optionee by Company or Acquisition
Company hereunder such amounts as shall be required by all applicable federal,
state and local laws, regulations and rulings.
11. Termination. This Agreement shall terminate upon termination of
the Merger Agreement (such date of termination being the "Termination Date").
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IN WITNESS WHEREOF, the undersigned has executed this document,
effective as of the date recited above.
PLAYCORE, INC.
By:
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Name:
Title:
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IN WITNESS WHEREOF, the undersigned has executed this document,
effective as of the date recited above.
JASDREW ACQUISITION CORP.
By:
--------------------------------
Name:
Title:
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IN WITNESS WHEREOF, the undersigned has executed this document,
effective as of the date recited above.
OPTIONEE
--------------------------------
Address:
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SPOUSAL CONSENT
I am the spouse of the Optionee and I acknowledge having read the
foregoing Option Exercise/Cancellation Agreement ("Option Agreement") to be
executed by my spouse, that I understand the contents thereof and that I agree
that any interest I may have under the Wisconsin Marital Property law or
otherwise in any Shares or Options which are held in the name of my spouse
shall be disposed of in accordance with the Option Agreement. I consent to the
Option Agreement and waive any legal right I may have to assert a spousal
community property or marital property interest in the Shares or the Options. I
represent, warrant and covenant that any such spousal interest I may have shall
be asserted, if at all, only against my spouse, and not against Company or
Acquisition Company or any other person or entity. I further agree that this
consent shall bind my successors, assigns, personal representatives, heirs and
legatees.
Dated _________________, 2000
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(Signature of Spouse)
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EXHIBIT A
NOTICE OF EXERCISE
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STOCK OPTION EXERCISE NOTICE
I, _____________________________, hereby give notice to PlayCore, Inc.
of my exercise of the following stock options at the following exercise prices:
Number of Shares
Covered by Options Exercise Price
------------------ --------------
$ per share
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$ per share
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$ per share
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Total: $
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The aggregate exercise price for these options will be paid in cash in
an amount of $____________ and a secured demand note in the amount of
$______________.
Please issue the stock certificate(s) for the shares in my name and
deliver such stock certificate(s) to the following:
PlayCore, Inc.
c/o
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Dated: March __, 2000
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Name:
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EXHIBIT B
FORM OF OPTIONEE NOTE
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FORM OF PROMISSORY NOTE
$_________________ Dated: ______________, 2000
FOR VALUE RECEIVED, the undersigned, ____________________, an
individual residing at _____________________ (the "Borrower"), HEREBY PROMISES
TO PAY to PlayCore, Inc. (the "Lender"), the principal amount of
_________________________ U.S. DOLLARS ($____________________) in lawful money
of the United States of America.
ARTICLE I.
DEFINITIONS
As used in this Note, the following terms shall have the following
meanings (such meanings to be equally applicable to both the singular and
plural forms of the terms defined):
"Acquisition Company" means Jasdrew Acquisition Corp., a
Delaware corporation.
"Acquisition Company Note" means the Promissory Note from
Acquisition Company to Borrower, dated _______________________________,
2000, substantially in the form attached as Exhibit 3 to the Option
Exercise Agreement.
"Option Exercise Agreement" means the Option
Exercise/Cancellation Agreement, dated as of _________________, 2000,
by and among Borrower, Lender and Acquisition Company.
"Option Shares" means Shares received by Borrower upon
exercise of options to purchase shares of Common Stock of the Company.
"Security Agreement" means a pledge, assignment and security
agreement entered into by the Borrower for the benefit of the Lender,
in substantially the form of Exhibit A hereto, as such agreement may
be amended or modified from time to time.
ARTICLE II.
AMOUNT AND TERMS OF THE LOAN
SECTION 2.1. The Loan. The Lender agrees, on the terms and conditions
hereinafter set forth, to make a loan (the "Loan") to the Borrower on the date
hereof in the amount set forth above, in order for Borrower to pay the exercise
price (other than the per share par value) for the In-the-Money Options (as
defined in the Option Exercise Agreement).
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SECTION 2.2. Repayment. The Borrower shall repay the unpaid principal
amount of the Loan on earlier of the date on which (x) Acquisition Company
acquires the Option Shares for cash consideration or (y) Acquisition Company
satisfies its payment obligations on the Acquisition Company Note.
SECTION 2.3. Prepayments. The Borrower may prepay the Note, in whole
or in part, at any time without penalty.
SECTION 2.4. Payments and Computations. The Borrower shall make each
payment hereunder not later than 1:00 P.M. (Milwaukee time) on the day when due
in U.S. Dollars to the Lender at its address referred to in Section 5.2 in same
day funds or by certified check.
ARTICLE III.
SECURITY AGREEMENT
The obligation of the Lender to make the Loan hereunder is subject to
the condition precedent that the Lender shall have received on or before the
date of such Loan the Security Agreement.
ARTICLE IV.
EVENTS OF DEFAULT
SECTION 4.1. Events of Default. If any of the following events
("Events of Default") shall occur and be continuing:
(a) The Borrower shall admit in writing his inability to pay his debts
generally, or shall make a general assignment for the benefit of creditors; or
any proceeding shall be instituted by or against the Borrower seeking to
adjudicate the Borrower a bankrupt or insolvent, or seeking liquidation,
protection, relief, or composition of the Borrower or of his debts under any
law relating to bankruptcy, insolvency or relief of debtors, or seeking the
entry of an order for relief for the Borrower or for any substantial part of
his or her property; or
(b) The Security Agreement after delivery thereof pursuant to Article
3 shall for any reason (other than pursuant to the terms thereof) cease to
create a valid security interest in any of the collateral purported to be
covered thereby,
then, and in any such event, the Lender may, by notice to the Borrower, declare
this Note and all other amounts payable under the Note to be forthwith due and
payable, whereupon this Note and all such amounts shall become and be forthwith
due and payable, without presentment, demand, protest or further notice of any
kind, all of which are hereby expressly waived by the Borrower; provided, that
in the event of an actual or deemed entry of an order for relief with respect
to the Borrower under the Federal Bankruptcy Code, this Note and all
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such amounts shall automatically become and be due and payable, without
presentment, demand, protest or any notice of any kind, all of which are hereby
expressly waived by the Borrower.
ARTICLE V.
MISCELLANEOUS
SECTION 5.1. Amendments, Etc. No amendment or waiver of any provision
of this Note, nor consent to any departure by the Borrower therefrom, shall in
any event be effective unless the same shall be in writing and signed by the
Lender and then any such waiver or consent shall be effective only in the
specific instance and for the specific purpose for which given.
SECTION 5.2. Notices, Etc. All notices and other communications
provided for hereunder shall be in writing (including telecopier, telegraphic,
telex or cable communication) and mailed, telecopied, telegraphed, telexed,
cabled or delivered, if to the Borrower, at its address as indicated in the
recital of parties to this Note; and if to the Lender, at its address at
__________________________, Attn: Xxxxxxx Xxxxx; or, as to each party, at such
other address and to such other individual as shall be designated by such party
in a written notice to the other party. All such notices and communications
shall, when mailed, telecopied, telegraphed, telexed or cabled, be effective
when deposited in the mails, telecopied, delivered to the telegraph company,
confirmed by telex answerback or delivered to the cable company, respectively.
SECTION 5.3. No Waiver; Remedies. No failure on the part of the Lender
to exercise, and no delay in exercising, any right under this Note shall
operate as a waiver hereof; nor shall any single or partial exercise of any
such right preclude any other or further exercise thereof or the exercise of
any other right. The remedies provided in this Note are cumulative and not
exclusive of any remedies provided by law.
SECTION 5.4. Binding Effect. This Note shall (a) be binding upon the
Borrower and his personal representatives, estate, heirs, devisees, legatees
and assigns, (b) inure to the benefit of the Borrower and his assigns and (c)
be binding upon and inure to the benefit of the Lender and its respective
successors and assigns, except that the Borrower shall not have the right to
assign his rights hereunder or any interest herein without the prior written
consent of the Lender.
SECTION 5.5. Governing Law. This Note shall be governed by, and
construed in accordance with, the laws of the State of New York.
SECTION 5.6. Cost of Collection. Lender shall be entitled to recover
from Borrower all costs and expenses (including reasonable attorneys' fees and
costs) incurred in collecting any amounts due hereunder.
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IN WITNESS WHEREOF, the Borrower has executed and the Lender has
caused this Note to be executed by its officer thereunto duly authorized, in
each case, as of the date first above written.
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, as Borrower
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CONSENTED TO AND ACKNOWLEDGED:
PLAYCORE, INC.
as Lender
By:
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Name:
Title:
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EXHIBIT A TO PROMISSORY NOTE
PLEDGE, ASSIGNMENT AND SECURITY AGREEMENT
PLEDGE, ASSIGNMENT AND SECURITY AGREEMENT, dated as of
__________________, 2000, made by the individual identified on the signature
page hereof (the "Pledgor"), residing at the address indicated for the Pledgor
on the signature page hereof, to PlayCore, Inc. (the "Pledgee").
PRELIMINARY STATEMENTS:
(1) The Pledgor has made a Promissory Note to the Pledgee, (the
"Note"), any terms defined therein and not otherwise defined herein being used
herein are as therein defined.
(2) The Pledgor is the owner of the number of Option Shares set forth
on the Signature Page hereof (the "Pledged Shares").
(3) The Note requires that the Pledgor shall grant the security
interest contemplated by this Agreement.
NOW, THEREFORE, in consideration of the premises and in order to
induce the Pledgee to make the loans under the Note, the Pledgor hereby agrees
with the Pledgee as follows:
SECTION 1. Grant of Security. The Pledgor hereby assigns, transfers
and pledges to the Pledgee, and hereby grants to the Pledgee a security
interest in, all of the Pledgor's right, title and interest in, to and under
the following, whether now owned or hereafter acquired, wherever located and
whether now or hereafter existing (the "Collateral")
(a) the Pledged Shares; and
(b) all dividends, cash, instruments and other property from time to
time received, receivable or otherwise distributed in respect of or in exchange
for any or all of such Pledged Shares:
SECTION 2. Security for Obligations. This Agreement secures the
payment of all obligations of the Pledgor now or hereafter existing under the
Note (all such obligations of the Pledgor being the "Obligations"). Without
limiting the generality of the foregoing, this Agreement secures the payment of
all amounts that constitute part of the Obligations and would be owed by the
Pledgor to the Pledgee under the Note but for the fact that they are
unenforceable or not allowable due to the existence of a bankruptcy,
reorganization or similar proceeding involving the Pledgor.
SECTION 3. Delivery of Collateral. All certificates or instruments
representing or evidencing the Collateral are being delivered to and will be
held by or on
21
behalf of the Pledgee pursuant hereto and shall be in suitable form for
transfer by delivery, or shall be accompanied by duly executed instruments of
transfer or assignment in blank, all in form and substance satisfactory to the
Pledgee.
SECTION 4. Representations and Warranties. The Pledgor represents and
warrants as follows:
(a) The residence of the Pledgor is located at the address specified
on the signature page of this Agreement.
(b) The Pledgor is the legal and beneficial owner of the Collateral
free and clear of any lien, security interest, option or other charge or
encumbrance, except for the security interests created by this Agreement and
under the Option Exercise Agreement.
(c) This Agreement has been duly executed and delivered by the Pledgor
and is a valid and binding obligation of the Pledgor, enforceable against the
Pledgor in accordance with its terms.
(d) The execution and delivery by the Pledgor of this Agreement and
the performance of its obligations thereunder are within the Pledgor's
authority and capacity and do not contravene any law, regulation, order or
contractual restriction binding on or affecting the Pledgor.
SECTION 5. Further Assurances. (a) The Pledgor agrees that from time
to time, at the expense of the Pledgee, the Pledgor will promptly execute and
deliver all further instruments and documents, and take all further action,
that may be necessary or desirable, or that the Pledgee may reasonably request,
in order to perfect and protect any pledge, assignment or security interest
granted or purported to be granted hereby or to enable the Pledgee to exercise
and enforce its rights and remedies hereunder with respect to any Collateral.
SECTION 6. Transfers and Other Liens. The Pledgor shall not (a) sell,
assign (by operation of law or otherwise) or otherwise dispose of, or grant any
option with respect to , any of the Collateral or (b) create or permit to exist
any lien, security interest, option or other charge or encumbrance upon or with
respect to any of the Collateral, except for the security interest under this
Agreement.
SECTION 7. Pledgee Appointed Attorney-in-Fact. The Pledgor hereby
irrevocably appoints the Pledgee the Pledgor's attorney-in-fact after the
occurrence of an Event of Default, with full authority in the place and stead
of the Pledgor and in the name of the Pledgor or otherwise, from time to time
in the Pledgee's discretion, to take any action and to execute any instrument
that the Pledgee may deem necessary or advisable to accomplish the purposes of
this Agreement.
SECTION 8. Pledgee May Perform. If the Pledgor fails to perform any
agreement contained herein, the Pledgee may itself perform, or cause
performance of, such
2
22
agreement, and the reasonable expenses of the Pledgee incurred in connection
therewith shall be payable by the Pledgor.
SECTION 9. The Pledgee's Duties. The powers conferred on the Pledgee
hereunder are solely to protect its interest in the Collateral and shall not
impose any duty upon it to exercise any such powers. The Pledgee shall be
deemed to have exercised reasonable care in the custody and preservation of any
Collateral in its possession if such Collateral is accorded treatment equal to
that which the Pledgee accords its own property.
SECTION 10. Remedies. If any Event of Default shall have occurred and
be continuing, Pledgee shall, by Notice to Pledgor, be entitled to take title
to the Collateral and Pledgor shall take all action reasonably requested by
Pledgee to effectuate such transfer.
SECTION 11. Amendments; Etc. No amendment or waiver of any provision
of this Agreement, and no consent to any departure by the Pledgor herefrom,
shall in any event be effective unless the same shall be in writing and signed
by the Pledgee, and then such waiver or consent shall be effective only in the
specific instance and for the specific purpose for which given.
SECTION 12. Addresses for Notices. All notices and other
communications provided for hereunder shall be in writing (including
telecopier, telegraphic, telex or cable communication) and mailed, telecopied,
telegraphed, telexed, cabled or delivered to it, if to the Pledgor or Pledgee,
at its address specified in the Note, or, as to either party, at such other
address as shall be designated by such party in a written notice to the other
party. All such notices and other communications shall, when mailed,
telecopied, telegraphed, telexed or cabled, be effective when deposited in the
mails, telecopied, delivered to the telegraph company, confirmed by telex
answer back or delivered to the cable company, respectively.
SECTION 13. Continuing Security Interest. This Agreement shall create
a continuing security interest in the Collateral and shall (a) remain in full
force and effect until the payment in full of the Obligations and all other
amounts payable under the Note, (b) be binding upon the Pledgor, its successors
and assigns and (c) inure to the benefit of, and be enforceable by, the Pledgee
and its successors, transferees and assigns.
SECTION 14. Release and Termination. The security interest granted
hereby shall terminate and all rights to the Collateral shall revert to the
Pledgor upon the payment in full of the Obligations and all other amounts
payable under the Note.
SECTION 15. Governing Law; Terms. This Agreement shall be governed by,
and construed in accordance with, the laws of the State of New York.
3
23
IN WITNESS WHEREOF, the Pledgor has duly executed and delivered this
Agreement, and the Pledgee has caused this Agreement to be duly executed and
delivered by its officer thereunto duly authorized, as of the date first above
written.
--------------------------------------
; as Pledgor
----------------------
Address:
-----------------------------
--------------------------------------
PLAYCORE, INC.
as Pledgee
By:
-----------------------------------
Title:
Number of Shares owned by Pledgor: _______________________ Shares.
24
FORM OF SPOUSAL CONSENT
The undersigned, spouse of _______________, a holder of stock of
PlayCore, Inc., a Delaware corporation (the "Company"), executing the foregoing
Promissory Note and Pledge, Assignment and Security Agreement, hereunto
subscribes [HIS/HER] name in evidence of [HIS/HER] agreement and consent to the
pledge of interests of the Company referred to in the foregoing Promissory Note
and Pledge, Assignment and Security Agreement, and to all other provisions
thereof.
Effective as of _________________, 2000.
-----------------------------
Name:
------------------------
25
EXHIBIT C
FORM OF ACQUISITION COMPANY NOTE
26
FORM OF PROMISSORY NOTE
$_________________ Dated: ______________, 2000
FOR VALUE RECEIVED, the undersigned, Jasdrew Acquisition Corp., a
Delaware corporation (the "Borrower"), HEREBY PROMISES TO PAY to
________________________, an individual residing at
_________________________________ (the "Lender") the principal amount of
_________________________ U.S. DOLLARS ($____________________) in lawful money
of the United States of America.
ARTICLE I.
DEFINITIONS
As used in this Note, the following terms shall have the following
meanings (such meanings to be equally applicable to both the singular and
plural forms of the terms defined):
"Merger Agreement" means the Merger Agreement, dated as of
_________________, 2000, by and among Borrower, PlayCore Holdings,
Inc., a Delaware corporation, and PlayCore, Inc., a Delaware
corporation.
"Option Shares" means all Shares received by Borrower upon
exercise of options to purchase shares of Common Stock of the Company.
ARTICLE II.
AMOUNT AND TERMS OF THE LOAN
SECTION 2.1. The Loan. The Lender has, on the terms and conditions
hereinafter set forth, made a loan (the "Loan") to the Borrower on the date
hereof in the amount set forth above, in connection with Borrower's purchase of
the Option Shares.
SECTION 2.2. Repayment. The Borrower shall repay the unpaid principal
amount of the Loan on the earlier to occur of (a) the date on which the Merger
contemplated by the Merger Agreement is consummated or (b) 48 hours following
the issuance of the Note.
SECTION 2.3. Prepayments. The Borrower may prepay the Note, in whole
or in part, at any time without penalty.
SECTION 2.4. Payments and Computations. The Borrower shall make each
payment hereunder not later than 3:00 P.M. (Milwaukee time) on the day when due
in U.S. Dollars to the Lender at its address referred to in Section 5.2 in same
day funds or by certified check.
27
ARTICLE III.
EVENTS OF DEFAULT
SECTION 3.1. Events of Default. If Borrower shall admit in writing his
inability to pay his debts generally, or shall make a general assignment for
the benefit of creditors; or any proceeding shall be instituted by or against
the Borrower seeking to adjudicate the Borrower a bankrupt or insolvent, or
seeking liquidation, protection, relief, or composition of the Borrower or of
his debts under any law relating to bankruptcy, insolvency or relief of
debtors, or seeking the entry of an order for relief for the Borrower or for
any substantial part of his or her property, then this Note shall automatically
become and be due and payable, without presentment, demand, protest or any
notice of any kind, all of which are hereby expressly waived by the Borrower.
ARTICLE IV.
MISCELLANEOUS
SECTION 4.1. Amendments, Etc. No amendment or waiver of any provision
of this Note, nor consent to any departure by the Borrower therefrom, shall in
any event be effective unless the same shall be in writing and signed by the
Lender and then any such waiver or consent shall be effective only in the
specific instance and for the specific purpose for which given.
SECTION 4.2. Notices, Etc. All notices and other communications
provided for hereunder shall be in writing (including telecopier, telegraphic,
telex or cable communication) and mailed, telecopied, telegraphed, telexed,
cabled or delivered, if to the Lender, at its address as indicated in the
recital of parties to this Note; and if to the Borrower, at its address at
__________________________, Attn: Xxxxxxx Xxxxx; or, as to each party, at such
other address and to such other individual as shall be designated by such party
in a written notice to the other party. All such notices and communications
shall, when mailed, telecopied, telegraphed, telexed or cabled, be effective
when deposited in the mails, telecopied, delivered to the telegraph company,
confirmed by telex answerback or delivered to the cable company, respectively.
SECTION 4.3. No Waiver; Remedies. No failure on the part of the Lender
to exercise, and no delay in exercising, any right under this Note shall
operate as a waiver hereof; nor shall any single or partial exercise of any
such right preclude any other or further exercise thereof or the exercise of
any other right. The remedies provided in this Note are cumulative and not
exclusive of any remedies provided by law.
SECTION 4.4. Binding Effect. This Note shall (a) be binding upon the
Borrower and its personal representatives, estate, heirs, devisees, legatees
and assigns, (b) inure to the benefit of the Borrower and its assigns and (c)
be binding upon and inure to the benefit of the Lender and his or her
respective successors and assigns, except that the
2
28
Borrower shall not have the right to assign his rights hereunder or any
interest herein without the prior written consent of the Lender.
SECTION 4.5. Governing Law. This Note shall be governed by, and
construed in accordance with, the laws of the State of New York.
SECTION 4.6. Cost of Collection. Lender shall be entitled to recover
from Borrower all costs and expenses (including reasonable attorneys' fees and
costs) incurred in collecting any amounts due hereunder.
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IN WITNESS WHEREOF, the Borrower has executed and the Lender has
caused this Note to be executed by its officer thereunto duly authorized, in
each case, as of the date first above written.
-----------------------------------
By:
Name:
CONSENTED TO AND ACKNOWLEDGED:
--------------------------------
as Lender
--------------------------------
Name:
4
30
SCHEDULE 1
XXXXXXXX X. XXXXXXX
OPTIONS:
PLAN GRANTED UNDER GRANT DATE EXERCISE PRICE UNDERLYING SHARES
------------------ ---------- -------------- -----------------
1996 1/5/98 $4.0000 25,000
1996 1/5/98 4.0000 50,000
1996 1/5/98 4.0000 50,000
1996 1/5/98 4.0000 50,000
1996 1/5/98 4.0000 150,000
1996 1/5/98 4.0000 50,000 *
* Constitutes Out-of-the-Money/Unvested Options
SHARES CURRENTLY OWNED: 5,400
XXXXXX VAN DER MEULEN
OPTIONS:
PLAN GRANTED UNDER GRANT DATE EXERCISE PRICE UNDERLYING SHARES
------------------ ---------- -------------- -----------------
1996 6/21/99 $6.1875 50,000
SHARES CURRENTLY OWNED: 0
31
XXXXXXX X. XXXXXXX
OPTIONS:
PLAN GRANTED UNDER GRANT DATE EXERCISE PRICE UNDERLYING SHARES
------------------ ---------- -------------- -----------------
1992 2/27/96 $3.7000 25,198
1996 5/21/97 7.0000 38,750
1996 5/21/97 8.0000 38,750
1996 5/21/97 9.2500 38,750
1996 5/21/97 10.6250 38,750
SHARES CURRENTLY OWNED: 0
XXXXXX XXXXXXXXXX
OPTIONS:
PLAN GRANTED UNDER GRANT DATE EXERCISE PRICE UNDERLYING SHARES
------------------ ---------- -------------- -----------------
1996 5/4/98 $4.6875 50,000
SHARES CURRENTLY OWNED: 10,000
XXX XXXXXX
OPTIONS:
PLAN GRANTED UNDER GRANT DATE EXERCISE PRICE UNDERLYING SHARES
------------------ ---------- -------------- -----------------
1996 5/21/97 $7.0000 5,000
1996 5/21/97 8.0000 5,000
1996 5/21/97 9.2500 5,000
1996 5/21/97 4.5000 5,000
SHARES CURRENTLY OWNED: 1,000
32
XXXXXXX X. XXXX
OPTIONS:
PLAN GRANTED UNDER GRANT DATE EXERCISE PRICE UNDERLYING SHARES
------------------ ---------- -------------- -----------------
1996 5/21/97 $7.0000 8,500
1996 5/21/97 8.0000 8,500
1996 5/21/97 9.2500 8,500
1996 5/21/97 4.5000 8,500
SHARES CURRENTLY OWNED: 500
XXXXXX XXXXXXXX
OPTIONS:
PLAN GRANTED UNDER GRANT DATE EXERCISE PRICE UNDERLYING SHARES
------------------ ---------- -------------- -----------------
1996 5/21/97 $7.0000 15,000
1996 5/21/97 8.0000 15,000
1996 5/21/97 9.2500 15,000
1996 5/21/97 4.5000 15,000
SHARES CURRENTLY OWNED: 7,000
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XXXX X. XXXXXXXX
OPTIONS:
PLAN GRANTED UNDER GRANT DATE EXERCISE PRICE UNDERLYING SHARES
------------------ ---------- -------------- -----------------
1996 3/01/97 $4.6700 20,000
1996 5/21/97 7.0000 20,000
1996 5/21/97 8.0000 20,000
1996 5/21/97 9.2500 20,000
1996 5/21/97 10.6250 20,000
SHARES CURRENTLY OWNED: 2,028*
* All Shares are owned by members of Xxxxxxxx'x family.
XXXXX X. XXXXXXXXX
OPTIONS:
PLAN GRANTED UNDER GRANT DATE EXERCISE PRICE UNDERLYING SHARES
------------------ ---------- -------------- -----------------
1992 2/27/96 $3.7000 22,895
1996 5/21/97 7.0000 17,500
1996 5/21/97 8.0000 17,500
1996 5/21/97 9.2500 17,500
1996 5/21/97 10.6250 17,500
SHARES CURRENTLY OWNED: 0
34
XXXXXX X. XXXX
OPTIONS:
PLAN GRANTED UNDER GRANT DATE EXERCISE PRICE UNDERLYING SHARES
------------------ ---------- -------------- -----------------
1992 2/27/96 $3.7000 25,198
1996 5/21/97 7.0000 11,250
1996 5/21/97 8.0000 11,250
1996 5/21/97 9.2500 11,250
1996 5/21/97 10.6250 11,250
SHARES CURRENTLY OWNED: 0
XXXX XXXXXX
OPTIONS:
PLAN GRANTED UNDER GRANT DATE EXERCISE PRICE UNDERLYING SHARES
------------------ ---------- -------------- -----------------
1996 5/21/97 $7.0000 5,000
1996 5/21/97 8.0000 5,000
1996 5/21/97 9.2500 5,000
1996 5/21/97 10.6250 5,000
SHARES CURRENTLY OWNED: 3,614
