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EXHIBIT 10.1
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STOCK PURCHASE AGREEMENT
by and among
CARMIKE CINEMAS, INC.
and
GS CAPITAL PARTNERS III, L.P.,
and certain of its affiliates
Dated: November 22, 1998
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TABLE OF CONTENTS
Page
ARTICLE 1 DEFINITIONS..................................................................................1
1.1 Definitions..................................................................................1
ARTICLE 2 PURCHASE AND SALE OF SECURITIES..............................................................6
2.1 Purchase and Sale of Securities..............................................................6
2.2 Certificates of Designation..................................................................6
2.3 Closing......................................................................................6
2.4 Use of Proceeds..............................................................................6
ARTICLE 3 REPRESENTATIONS AND WARRANTIES OF THE COMPANY................................................6
3.1 Corporate Existence and Power................................................................7
3.2 Subsidiaries.................................................................................7
3.3 Corporate Authorization; No Contravention....................................................7
3.4 Governmental Authorization; Third Party Consents.............................................7
3.5 Binding Effect...............................................................................8
3.6 Capitalization of the Company................................................................8
3.7 SEC Filings; Financial Statements............................................................9
3.8 Absence of Certain Developments..............................................................9
3.9 No Undisclosed Liabilities...................................................................9
3.10 Compliance with Laws.........................................................................9
3.11 Litigation..................................................................................10
3.12 Material Contracts..........................................................................10
3.13 Private Offering............................................................................10
3.14 Board Approval; DGCL 203; Stockholder Approval..............................................10
ARTICLE 4 REPRESENTATIONS AND WARRANTIES OF THE PURCHASERS............................................11
4.1 Existence and Power.........................................................................11
4.2 Authorization; No Contravention.............................................................11
4.3 Governmental Authorization; Third Party Consents............................................11
4.4 Binding Effect..............................................................................11
4.5 Purchase for Own Account, Etc...............................................................11
4.6 Sufficient Funds............................................................................12
ARTICLE 5 COVENANTS OF THE COMPANY....................................................................12
5.1 Conduct of Business.........................................................................12
5.2 Indemnification of Brokerage................................................................13
5.3 Rule 144....................................................................................13
5.4 HSR Approval................................................................................13
5.5 No Rights Plan..............................................................................13
ARTICLE 6 COVENANTS OF THE PURCHASER..................................................................14
6.1 Indemnification of Brokerage................................................................14
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ARTICLE 7 CONDITIONS PRECEDENT TO THE OBLIGATIONS OF THE PURCHASERS TO CLOSE..........................14
7.1 Representations and Covenants...............................................................14
7.2 Filing of Certificates of Designations......................................................14
7.3 Opinion of Counsel to the Company...........................................................14
7.4 No Actions..................................................................................15
7.5 NYSE Listing................................................................................15
ARTICLE 8 CONDITIONS PRECEDENT TO THE OBLIGATIONS OF THE COMPANY TO CLOSE.............................15
8.1 Representations and Covenants...............................................................15
8.2 No Actions..................................................................................15
ARTICLE 9 REGISTRATION RIGHTS; PREEMPTIVE RIGHTS......................................................15
9.1 Requested Registration......................................................................15
9.2 Company Registration........................................................................17
9.3 Transferability.............................................................................17
9.4 Expenses of Registration....................................................................18
9.5 Registration Procedures.....................................................................18
9.6 Indemnification.............................................................................20
9.7 Holdback Agreement..........................................................................23
9.8 Other Registration Rights...................................................................24
9.9 Preemptive Rights...........................................................................24
ARTICLE 10 DIRECTOR DESIGNATION RIGHT..................................................................25
10.1 Directors...................................................................................25
ARTICLE 11 TERMINATION OF AGREEMENT....................................................................26
11.1 Termination.................................................................................26
11.2 Survival After Termination..................................................................27
ARTICLE 12 MISCELLANEOUS...............................................................................27
12.1 Survival....................................................................................27
12.2 Expenses....................................................................................27
12.3 Notices.....................................................................................28
12.4 Successors and Assigns......................................................................29
12.5 Amendment and Waiver........................................................................29
12.6 Counterparts................................................................................29
12.7 Headings....................................................................................29
12.8 GOVERNING LAW...............................................................................29
12.9 Severability................................................................................30
12.10 Entire Agreement............................................................................30
12.11 Further Assurances..........................................................................30
12.12 Public Announcements........................................................................30
12.13 Specific Performance........................................................................30
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Page
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EXHIBIT A Form of Certificate of Designations of 5.5% Series A Senior
Cumulative Convertible Exchangeable Preferred Stock
EXHIBIT B Form of Opinion of Counsel to the Company
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STOCK PURCHASE AGREEMENT
STOCK PURCHASE AGREEMENT, dated as of November 22, 1998 (this
"Agreement"), by and among CARMIKE CINEMAS, INC., a Delaware corporation (the
"Company"), and GS CAPITAL PARTNERS III, L.P., a Delaware limited partnership
("GSCPIII") and certain affiliates of GSCPIII set forth on the signature page of
this Agreement (the "GSCP Affiliates", and together with GSCPIII, and including
their respective successors and permitted assigns, the "Purchasers").
WHEREAS, the Company proposes to issue and sell to the
Purchasers, and the Purchasers propose to buy, for an aggregate purchase price
of Fifty-Five Million Dollars ($55,000,000.00), 550,000 shares of 5.5% Series A
Senior Cumulative Convertible Exchangeable Preferred Stock, par value $1.00 per
share, of the Company;
NOW, THEREFORE, in consideration of the mutual covenants and
agreements set forth herein and for good and valuable consideration, the receipt
and adequacy of which is hereby acknowledged, the parties hereto agree as
follows:
ARTICLE 1
DEFINITIONS
1.1 Definitions. As used in this Agreement, and unless the
context requires a different meaning, the following terms shall have the
meanings set forth below:
"Actions" means actions, causes of action, suits, claims,
complaints, demands, litigations or legal, administrative or arbitral
proceedings.
"Affiliate" means a Person that directly, or indirectly
through one or more intermediaries, Controls or is Controlled by, or is under
common Control with the Person specified.
"Agreement" means this Agreement as the same may be amended,
supplemented or modified in accordance with the terms hereof.
"Allocation Notice" has the meaning assigned to such term in
Section 2.3(b).
"Board of Directors" means the board of directors of the
Company or any duly authorized committee thereof.
"Broker" has the meaning assigned to such term in Section 5.2.
"Business Day" means any day other than Saturday, Sunday or
other day on which commercial banks in the State of New York are authorized or
required by law or executive order to close.
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"Bylaws" means the bylaws of the Company, as the same may have
been amended and in effect as of the Closing Date.
"Certificate of Designations" means the Certificate of
Designations, in the form attached hereto as Exhibit A, relating to the Series A
Preferred Stock.
"Certificate of Incorporation" means the Restated Certificate
of Incorporation of the Company, as the same may have been amended and in effect
as of the Closing Date.
"Claims" means losses, claims, damages or liabilities, joint
or several, Actions or proceedings (whether commenced or threatened).
"Class A Common Stock" means the Class A Common Stock, par
value $.03 per share, of the Company, or any other capital stock of the Company
into which such stock is reclassified or reconstituted.
"Class B Common Stock" means the Class B Common Stock, par
value $.03 per share, of the Company, or any other capital stock of the Company
into which such stock is reclassified or reconstituted.
"Closing" has the meaning assigned to such term in Section
2.3.
"Closing Date" has the meaning assigned to such term in
Section 2.3.
"Commission" means the Securities and Exchange Commission or
any similar agency then having jurisdiction to enforce the Securities Act.
"Common Stock" means the Class A Common Stock and Class B
Common Stock.
"Company Options" has the meaning assigned to such term in
Section 3.6.
"Contemplated Transactions" means the transactions
contemplated by this Agreement, including without limitation the purchase and
sale of the Series A Preferred Stock and the conversion of shares of Series A
Preferred Stock into shares of Class A Common Stock from time to time in
accordance with the Certificate of Designations.
"Contractual Obligation" means, as to any Person, any
agreement, undertaking, contract, indenture, mortgage, deed of trust, credit
agreement, note, evidence of indebtedness or other instrument, written or
otherwise, to which such Person is a party or by which it or any of its property
is bound.
"Control" (including the terms "controlling," "controlled by"
and "under common control with") means the possession, directly or indirectly,
of the power to direct or cause the direction of the management and policies of
a Person, whether through the ownership of voting securities, by contract or
otherwise.
"Decrees" has the meaning assigned to such term in Section
3.10(a).
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"Demand Notice" has the meaning assigned to such term in
Section 9.1(a).
"DGCL" means the Delaware General Corporation Law.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended, and the rules and regulations of the Commission thereunder.
"Exercising Holder" has the meaning assigned to such term in
Section 9.2(b).
"Existing Plans" has the meaning assigned to such term in
Section 3.6.
"GAAP" means United States generally accepted accounting
principles as in effect from time to time.
"Governmental Authority" means the government of any nation,
state, city, locality or other political subdivision of any thereof, and any
entity exercising executive, legislative, judicial, regulatory or administrative
functions of or pertaining to government or any international regulatory body
having or asserting jurisdiction over a Person, its business or its properties.
"GSCPIII" has the meaning assigned to such term in the
preamble.
"HSR Act" means the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements
Act of 1976, as amended, and the rules and regulations of the Federal Trade
Commission thereunder.
"HSR Clearance Date" has the meaning assigned to such term in
Section 10.1(b).
"HSR Requirements" has the meaning assigned to such term in
Section 3.4.
"Holder" means a holder of shares of Series A Preferred Stock
or Registrable Securities.
"Initial Designees" means two individuals designated by
GSCPIII in writing on or prior to the HSR Clearance Date to serve as directors
on the Board of Directors.
"Lien" means any mortgage, deed of trust, pledge,
hypothecation, assignment, encumbrance, lien (statutory or other), restriction
or other security interest of any kind or nature whatsoever.
"Material Adverse Effect" has the meaning assigned to such
term in Section 3.8.
"NASD" means the National Association of Securities Dealers,
Inc.
"Nasdaq" means The Nasdaq Stock Market Inc.'s National Market.
"NYSE" means the New York Stock Exchange, Inc.
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"Person" means any individual, firm, corporation, partnership,
limited liability company, trust, incorporated or unincorporated association,
joint venture, joint stock company, Governmental Authority or other entity of
any kind.
"Preferred Stock" has the meaning assigned to such term in
Section 3.6.
"Proposed Securities" has the meaning assigned to such term in
Section 9.9(a).
"Prospectus" shall mean the prospectus included in any
Registration Statement (including without limitation a prospectus that discloses
information previously omitted from a prospectus filed as part of an effective
registration statement in reliance upon Rule 430A promulgated under the
Securities Act), as amended or supplemented by any prospectus supplement, with
respect to the terms of the offering of any portion of the Registrable
Securities covered by such Registration Statement and all other amendments and
supplements to such prospectus, including post-effective amendments, and all
material incorporated by reference or deemed to be incorporated by reference in
such prospectus.
"Purchased Shares" has the meaning assigned to such term in
Section 2.1.
"Purchaser Designees" has the meaning assigned to such term in
Section 10.1(a).
"Registrable Securities" shall mean the shares of Common Stock
(1) into which shares of Series A Preferred Stock issued hereunder may be
converted and any capital stock of the Company issued as a dividend or other
distribution with respect to, or in exchange for or in replacement of, such
shares of Common Stock or (2) acquired in connection with the exercise of
preemptive rights pursuant to Section 9.9, in each case until, in the case of
any such share, (i) it is effectively registered under the Securities Act and
disposed of in accordance with the Registration Statement covering it, or (ii)
it is distributed to the public by the holder thereof pursuant to Rule 144.
"Registration Expenses" shall mean any and all expenses
incident to performance of or compliance with Article 9 of this Agreement,
including without limitation, (i) all Commission and stock exchange or the NASD
registration and filing fees, (ii) all fees and expenses of complying with
securities or "blue sky" laws (including reasonable fees and disbursements of
counsel for the underwriters in connection with "blue sky" qualifications of the
Registrable Securities), (iii) all printing, messenger and delivery expenses,
(iv) the fees and disbursements of counsel for the Company and of the Company's
independent public accountants, including the expenses of any special audits
and/or "cold comfort" letters required by or incident to such performance and
compliance, (v) the reasonable fees and disbursements of one counsel retained by
the Exercising Holders (if GSCPIII is one of the Exercising Holders, such
counsel to be selected by GSCPIII) as a group in connection with each such
registration, (vi) any fees and disbursements of underwriters customarily paid
by issuers or sellers of securities and the reasonable fees and expenses of any
special experts retained in connection with the requested registration,
including any fee payable to a qualified independent underwriter within the
meaning of the rules of the NASD, but excluding underwriting discounts and
commissions and transfer taxes, if any, (vii) internal expenses of the Company
(including, without limitation, all salaries and expenses of its officers and
employees performing legal or
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accounting duties) and (viii) securities acts liability insurance (if the
Company elects to obtain such insurance).
"Registration Statement" shall mean any registration statement
of the Company under the Securities Act that covers any of the Registrable
Securities pursuant to the provisions of this Agreement, including the related
Prospectus, all amendments and supplements to such registration statement
(including post-effective amendments), all exhibits and all material
incorporated by reference or deemed to be incorporated by reference in such
registration statement.
"Requirement of Law" means, as to any Person, the Certificate
of Incorporation and Bylaws or other organizational or governing documents of
such Person, and any law, treaty, rule, regulation, ordinance, qualification,
license or franchise or determination (including, without limitation, those
related to taxes and to environmental matters) of an arbitrator or a court or
other Governmental Authority or of the NYSE or NASD or any national securities
exchange on which the Common Stock is listed or admitted to trading, in each
case applicable or binding upon such Person or any of its property or to which
such Person or any of its property is subject or pertaining to any or all of the
transactions contemplated hereby.
"Rule 144" shall mean Rule 144 promulgated by the Commission
under the Securities Act, as such Rule may be amended from time to time, or any
similar rule or regulation hereafter adopted by the Commission.
"SEC Reports" means all proxy statements, registration
statements, reports and other documents filed or required to be filed by the
Company or any of its Subsidiaries with the Commission pursuant to the
Securities Act or the Exchange Act since December 31, 1996.
"Section 9.1 Exercising Holder" has the meaning assigned to
such term in Section 9.1(b).
"Section 9.2 Exercising Holder" has the meaning assigned to
such term in Section 9.2(b).
"Securities Act" means the Securities Act of 1933, as amended,
and the rules and regulations of the Commission thereunder.
"Series A Preferred Stock" means the Company's 5.5% Series A
Senior Cumulative Convertible Exchangeable Preferred Stock, par value $1.00 per
share, established by the filing of the Certificate of Designations thereof, in
the form attached hereto as Exhibit A, in the Office of the Secretary of State
of Delaware.
"Subsidiary" means in respect of any Person any other Person
which, at the time as of which any determination is made, such Person or one or
more of its Subsidiaries has, directly or indirectly, voting control.
"Transfer" means any sale, assignment, hypothecation, transfer
or other disposition. "Transferor" and "Transferee" shall have correlative
meanings.
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"Violation" has the meaning assigned to such term in Section
9.6(a).
ARTICLE 2
PURCHASE AND SALE OF SECURITIES
2.1 Purchase and Sale of Securities. Subject to the terms set
forth herein and in reliance upon the representations set forth below, the
Company agrees to sell to the Purchasers, and the Purchasers agree collectively
to purchase from the Company, on the Closing Date, an aggregate of 550,000
shares of Series A Preferred Stock for the aggregate purchase price of
$55,000,000.00 (all of the shares of Series A Preferred Stock being purchased
pursuant hereto being referred to herein as the "Purchased Shares").
2.2 Certificates of Designation. The Series A Preferred Stock
shall have the powers, rights and preferences set forth in the form of
Certificate of Designations attached hereto as Exhibit A.
2.3 Closing. (a) The purchase and issuance of the Purchased
Shares shall take place at a closing (the "Closing") to be held at the offices
of Wachtell, Lipton, Xxxxx & Xxxx, 00 Xxxx 00xx Xxxxxx, Xxx Xxxx, Xxx Xxxx, at
10:00 A.M., local time, on the Closing Date. The "Closing Date" shall be (i) the
later of (1) November 30, 1998 or (2) the first Business Day after the
conditions to closing set forth in Articles 7 and 8 (other than those to be
satisfied at the Closing, which shall be satisfied or waived at the Closing)
have been satisfied or waived by the party entitled to waive such condition, or
(ii) such other date and time as the parties may agree.
(b) Not less than two Business Days prior to the
Closing, the Purchasers shall advise the Company in writing (the "Allocation
Notice") of the names in which to register the shares of Series A Preferred
Stock to be purchased at the Closing (which shall be the names of one or more of
the Purchasers or their nominees) and the number of shares to be purchased by
each Purchaser (which numbers, when added together, shall equal 550,000). At the
Closing, the Company shall deliver to the Purchasers certificates representing
the Purchased Shares (each of which shall be fully paid, non-assessable and free
and clear of any Liens), duly registered in the name of each Purchaser or its
nominee (as set forth in the Allocation Notice), and the Purchasers shall
deliver to the Company the aggregate purchase price therefor by wire transfer of
immediately available funds to an account designated in writing by the Company
to the Purchasers at least two Business Days before the Closing.
2.4 Use of Proceeds. Funds received by the Company in respect
of the aggregate purchase price referred to in Section 2.1 shall be used by the
Company solely to reduce borrowings under indebtedness outstanding on the date
hereof.
ARTICLE 3
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
The Company hereby represents and warrants to the Purchasers
as follows:
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3.1 Corporate Existence and Power. The Company (a) is a
corporation duly incorporated, validly existing and in good standing under the
laws of the State of Delaware; (b) has all requisite corporate power and
authority to own and operate its property, to lease the property it operates as
lessee and to conduct the business in which it is engaged; and (c) has the
corporate power and authority to execute, deliver and perform its obligations
under this Agreement. The Company is duly qualified to do business as a foreign
corporation in, and is in good standing under the laws of, each jurisdiction in
which the conduct of its business or the nature of the property owned requires
such qualification, except where the failure to be so qualified and in good
standing would not have a Material Adverse Effect.
3.2 Subsidiaries. Except as set forth on Schedule 3.2, the
Company has no Subsidiaries and no material interest or investments in any
corporation, partnership, limited liability company, trust or other entity or
organization. Each Subsidiary listed on Schedule 3.2 has been duly organized, is
validly existing and in good standing under the laws of the jurisdiction of its
organization, has the corporate power and authority to own its properties and to
conduct its business and is duly registered, qualified and authorized to
transact business and is in good standing in each jurisdiction in which the
conduct of its business or the nature of its properties requires such
registration, qualification or authorization, except where the failure to be so
registered, qualified or authorized would not have a Material Adverse Effect.
Except as disclosed on Schedule 3.2, all of the issued and outstanding capital
stock (or equivalent interests) of each Subsidiary set forth on Schedule 3.2 has
been duly authorized and validly issued, is fully paid and non-assessable and is
owned by the Company free and clear of any Liens and there are no rights,
options or warrants outstanding or other agreements to acquire shares of capital
stock (or equivalent interests) of such Subsidiary.
3.3 Corporate Authorization; No Contravention. The execution,
delivery and performance by the Company of this Agreement and the Contemplated
Transactions, (a) have been duly authorized by all necessary corporate action of
the Company; (b) do not contravene the terms of the Certificate of Incorporation
or Bylaws of the Company or the organizational documents of its Subsidiaries;
and (c) except as would not have a Material Adverse Effect, do not violate or
result in any breach or contravention of, a default under, or an acceleration of
any obligation under or the creation (with or without notice, lapse of time or
both) of any Lien under, any Contractual Obligation of the Company or its
Subsidiaries or any Requirement of Law applicable to the Company or its
Subsidiaries. No event has occurred and no condition exists which (upon notice
or the passage of time or both) would constitute, or give rise to: (i) any
breach, violation, default, change of control or right to cause the Company to
repurchase or redeem under, (ii) any Lien on the assets of the Company or any of
its Subsidiaries under, (iii) any termination right of any party under or (iv)
any change or acceleration in the rights or obligations of any party under, any
indenture, mortgage, deed of trust, credit or other agreement, contract, lease,
license, note or other evidence of indebtedness or other material agreement of
the Company or its Subsidiaries or the Certificate of Incorporation or Bylaws or
the organizational documents of the Company's Subsidiaries, except for any such
breach, violation, default acceleration, creation or change that does not,
individually or in the aggregate, have a Material Adverse Effect.
3.4 Governmental Authorization; Third Party Consents. Except
as would not have a Material Adverse Effect or materially affect the Purchasers'
ability to own the Purchased
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Shares and exercise the rights incident thereto, no approval, consent,
exemption, authorization or other action by, or notice to, or filing with, any
Governmental Authority or any other Person in respect of any Requirement of Law,
Contractual Obligation or otherwise, and no lapse of a waiting period under a
Requirement of Law, is necessary or required in connection with the execution,
delivery or performance (including, without limitation, the sale, issuance and
delivery of the Purchased Shares) by the Company, or enforcement against the
Company, of this Agreement or the Contemplated Transactions; provided, however,
that expiration or termination of the waiting periods under the HSR Act
applicable to the purchase of voting securities of the Company by the Purchasers
or the receipt of any necessary clearance from any appropriate Governmental
Authority charged with enforcement of the HSR Act with respect thereto
(collectively, the "HSR Requirements") is required in order for the Purchasers
to have the directors designation rights set forth in Article 10 hereof and for
the Purchased Shares to have voting rights.
3.5 Binding Effect. This Agreement has been duly executed and
delivered by the Company and constitutes the legal, valid and binding obligation
of the Company enforceable against the Company in accordance with its terms.
3.6 Capitalization of the Company. The authorized capital
stock of the Company consists of (i) 27,500,000 shares of Common Stock, of which
22,500,000 shares are designated as Class A Common Stock and 5,000,000 shares
are designated as Class B Common Stock, and (ii) 1,000,000 shares of preferred
stock, par value $1.00, of the Company (the "Preferred Stock"). As of November
22, 1998, (a) no shares of Preferred Stock were issued or outstanding, (b)
9,942,487 shares of Class A Common Stock were issued and outstanding, (c)
1,420,700 shares of Class B Common Stock were issued and outstanding, and (d)
1,935,000 shares of Class A Common Stock were reserved for or subject to
issuance upon the exercise of outstanding Company Options or upon conversion of
outstanding shares of Class B Common Stock. Schedule 3.6 sets forth a true and
correct list of all outstanding options or warrants to purchase shares of any
class or series of capital stock of the Company (collectively, the "Company
Options") and a true and correct list of each of the Company's stock option,
incentive or other plans pursuant to which options or warrants to purchase
capital stock of the Company may be issued (collectively, the "Existing Plans").
Except (1) as set forth in the second sentence of this Section 3.6, (2) shares
of Common Stock issued (i) pursuant to the exercise of outstanding Company
Options or (ii) on the conversion of outstanding shares of Class B Common Stock
and (3) options granted under Existing Plans after the date hereof, on the
Closing Date there will be no shares of Common Stock or any other equity
security of the Company issuable upon conversion or exchange of any security of
the Company nor will there be any rights, options or warrants outstanding or
other agreements to acquire shares of capital stock of the Company nor will the
Company be contractually obligated to issue any shares of capital stock or to
purchase, redeem or otherwise acquire any of its outstanding shares of capital
stock. The Company has not created any "phantom stock," stock appreciation
rights or other similar rights the value of which is related to or based upon
the price or value of the Common Stock. None of the Company's outstanding debt
or debt instruments provide voting rights with respect to the Company to the
holders thereof. No stockholder of the Company or other Person is entitled to
any preemptive or similar rights to subscribe for shares of capital stock of the
Company. All of the issued and outstanding shares of Common Stock are, and the
Purchased Shares (when issued hereunder)
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after payment of the purchase price therefor to the Company, will be, duly
authorized, validly issued, fully paid, nonassessable, and free and clear of all
Liens (other than any such Liens imposed by the Purchasers or any of their
creditors). Except as set forth on Schedule 3.6 hereto, the Company has not
granted to any Person the right to demand or request that the Company effect a
registration under the Securities Act of any securities held by such Person or
to include any securities of such Person in any such registration by the
Company.
3.7 SEC Filings; Financial Statements. The Company has timely
filed all SEC Reports. Each SEC Report complied in all material respects with
the applicable requirements of the Securities Act or the Exchange Act, as
applicable, and did not contain any untrue statement of a material fact or omit
to state a material fact required to be stated therein or necessary in order to
make the statements in the SEC Reports, in light of the circumstances under
which they were made, not misleading. Each of the Company's financial statements
(including, in each case, any related notes) contained in the SEC Reports
complied as to form in all material respects with applicable published rules and
regulations of the Commission with respect thereto, was prepared in accordance
with GAAP applied on a consistent basis throughout the periods involved (except
as may be indicated in the notes to such financial statements) and fairly
presented the financial position of the Company and its Subsidiaries as at the
respective dates and the results of operations and cash flows for the periods
indicated, except that unaudited financial statements were subject to normal and
recurring year-end adjustments which were not or are not expected to be material
in amount or effect.
3.8 Absence of Certain Developments. Since December 31, 1997,
except as described in the SEC Reports filed with the Commission prior to the
date hereof, (a) the Company has operated in the ordinary course and (b) there
has been no material adverse change, or any developments that, individually or
in the aggregate, would reasonably be expected to cause material adverse change,
in or affecting the business, results of operations, management or condition,
financial or otherwise, of the Company and its Subsidiaries, taken as a whole (a
"Material Adverse Effect").
3.9 No Undisclosed Liabilities. Neither the Company nor any
of its Subsidiaries has any liabilities or obligations of any nature, whether or
not accrued, contingent or otherwise, except (a) liabilities or obligations
disclosed or reserved against in the SEC Reports filed prior to the date of this
Agreement or (b) liabilities or obligations which could not have, individually
or in the aggregate, have not had, and could not reasonably be expected to have,
a Material Adverse Effect.
3.10 Compliance with Laws. Except as would not have a
Material Adverse Effect, the Company and each of its Subsidiaries: (a) in the
conduct of its business, is not, and since December 31, 1996, has not been, in
violation of any Requirement of Law, or any judgments, orders, rulings,
injunctions or decrees of Governmental Authority (collectively, "Decrees"),
applicable thereto or to the employees conducting such business;
(b) has all permits, licenses, authorizations, orders
and approvals of, and have made all filings, applications and registrations
with, all Governmental Authorities that are required in order to permit it to
conduct its businesses as presently conducted; all such permits,
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licenses, authorizations, orders and approvals are in full force and effect and,
to the best of the Company's knowledge, no suspension or cancellation of any of
them is threatened; and
(c) has received, since December 31, 1996, no
notification or communication from any Governmental Authority (i) asserting that
it is not in compliance with any of the Requirements of Law or Decrees which
such Governmental Authority enforces or (ii) threatening to revoke any permit,
license, authorization, order or approval.
3.11 Litigation. There is no legal action, suit, arbitration
or other legal, administrative or other governmental investigation, inquiry or
proceeding pending or, to the best knowledge of the Company, threatened against
or affecting the Company or any of its Subsidiaries or relating to this
Agreement or the Contemplated Transactions which, if determined adversely to the
Company, could reasonably be expected to have a Material Adverse Effect or could
reasonably be expected to materially delay or prohibit the Closing. The Company
is not subject to any Decree that, individually or in the aggregate, could
reasonably be expected to have a Material Adverse Effect.
3.12 Material Contracts. All of the Company's Contractual
Obligations that are required to be described in the SEC Reports or to be filed
as exhibits thereto are described in the SEC Reports or filed as exhibits
thereto, as so required. Neither the Company nor any of its Subsidiaries nor any
other party is in breach of or in default under any of the Company's Contractual
Obligations except for such breaches and defaults which could not, individually
or in the aggregate, reasonably be expected to have a Material Adverse Effect.
3.13 Private Offering. No form of general solicitation or
general advertising was used by the Company or its representatives in connection
with the offer or sale of the Purchased Shares. No registration of the Purchased
Shares pursuant to the provisions of the Securities Act or any state securities
or "blue sky" laws will be required by the offer, sale, or issuance of the
Purchased Shares pursuant to this Agreement, assuming the accuracy of the
Purchaser's representation contained in Section 4.5.
3.14 Board Approval; DGCL 203; Stockholder Approval. (a) The
Board of Directors, at a meeting duly called and held, has determined the
Contemplated Transactions to be advisable and in the best interests of the
Company and its stockholders and has approved the Contemplated Transactions.
(b) The Company has taken all action necessary to cause
the restriction contained in Section 203 of the DGCL to be inapplicable to the
Contemplated Transactions and to approve the Purchasers becoming "interested
stockholders" within the meaning of Section 203 of the DGCL, whether by way of
the Contemplated Transactions, conversion of the Series A Preferred Stock or any
future transaction.
(c) No approval of this Agreement or of the
Contemplated Transactions by the holders of any shares of capital stock of the
Company is required in connection with the execution or delivery of this
Agreement or the consummation of the Contemplated Transactions, whether pursuant
to the DGCL, the Certificate of Incorporation or Bylaws of the Company, the
rules and regulations of the NYSE, or otherwise.
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ARTICLE 4
REPRESENTATIONS AND WARRANTIES OF THE PURCHASERS
Each Purchaser hereby represents and warrants to the Company
as follows as to itself:
4.1 Existence and Power. Such Purchaser (a) is duly organized
and validly existing as a limited partnership under the laws of the jurisdiction
of its formation (except that Xxxxxxx Xxxxx & Co. Verwaltungs GMBH is a civil
law partnership under German law) and (b) has the requisite power and authority
to execute, deliver and perform its obligations under this Agreement.
4.2 Authorization; No Contravention. The execution, delivery
and performance by such Purchaser of this Agreement and the Contemplated
Transactions(a) have been duly authorized by all necessary partnership action,
(b) do not contravene the terms of such Purchaser's organizational documents, or
any amendment thereof, and (c) do not violate, conflict with or result in any
breach or contravention of, or the creation of any Lien under, any Contractual
Obligation of such Purchaser or any Requirement of Law applicable to such
Purchaser, except for such violations, conflicts, breaches or Liens which will
not result in a material adverse effect on such Purchaser's ability to
consummate the Contemplated Transactions.
4.3 Governmental Authorization; Third Party Consents. Except
as would not have a Material Adverse Effect or materially affect the Purchasers'
ability to own the Purchased Shares and exercise the rights incident thereto, no
approval, consent, exemption, authorization, or other action by, or notice to,
or filing with, any Governmental Authority or any other Person in respect of any
Requirement of Law, and no lapse of a waiting period under a Requirement of Law,
is necessary or required in connection with the execution, delivery or
performance by such Purchaser, or enforcement against such Purchaser, of this
Agreement or the consummation of the Contemplated Transactions; provided,
however, that satisfaction of the HSR Requirements is required in order for the
Purchasers to have the director designation rights set forth in Article 10
hereof and for the Purchased Shares to have voting rights.
4.4 Binding Effect. This Agreement has been duly executed and
delivered by such Purchaser and constitutes the legal, valid and binding
obligation of the Purchaser, enforceable against it in accordance with its
terms.
4.5 Purchase for Own Account, Etc. (a) Purchase for Own
Account. The Purchased Shares are being acquired by such Purchaser for its own
account and with no current intention of distributing or reselling such
Purchased Shares or any part thereof in any transaction that would be in
violation of the securities laws of the United States of America or any state,
without prejudice, however, to the rights of such Purchaser at all times to sell
or otherwise dispose of all or any part of such Purchased Shares under an
effective Registration Statement under the Securities Act or under an exemption
from said registration available under the Securities Act. Such Purchaser
understands and agrees that if such Purchaser should in the future decide to
dispose of any Purchased Shares, it may do so only in compliance with the
Securities
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Act and applicable state securities laws, as then in effect. Such Purchaser
agrees to the imprinting, so long as required by law, of a legend on all
certificates representing such Purchased Shares to the following effect:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR
THE SECURITIES LAWS OF ANY STATE AND MAY NOT BE OFFERED FOR
SALE, SOLD OR OTHERWISE TRANSFERRED EXCEPT PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER SUCH ACT AND APPLICABLE
STATE SECURITIES LAWS OR PURSUANT TO AN APPLICABLE EXEMPTION
FROM THE REGISTRATION REQUIREMENTS OF SUCH ACT AND SUCH LAWS.
The legend set forth above may be removed if and when the securities represented
by such certificate are disposed of pursuant to an effective registration
statement under the Securities Act or upon the Company's receipt of an opinion
of counsel, in form and substance and from counsel reasonably satisfactory to
the Company and its counsel, confirming that any sale or transfer of such
securities will not require registration of such securities under the Securities
Act or under any blue sky or similar laws. In such event, the holder of any such
certificate may exchange such certificate for a new certificate, without legend,
representing the same number of shares of Series A Preferred Stock as were
represented by the certificate so exchanged, and the Company shall promptly
issue and deliver such new certificate upon receipt of the old, which shall
thereupon be cancelled.
(b) Purchaser Status. Such Purchaser is an "Accredited
Investor" (as defined in Rule 501(a)) under the Securities Act.
(c) Restricted Shares. Such Purchaser understands (i) that
the Purchased Shares have not been, and the shares of Class A Common Stock
issuable upon conversion of the Purchased Shares (the "Conversion Shares") will
not be, registered under the Securities Act or any state securities laws, by
reason of their issuance by the Company in a transaction exempt from the
registration requirements thereof and (ii) the Purchased Shares and the
Conversion Shares may not be sold unless such disposition is registered under
the Securities Act and applicable state securities laws or is exempt from
registration thereunder.
4.6 Sufficient Funds. Each Purchaser will have available funds
sufficient to purchase such Purchaser's allocation of the Purchased Shares in
accordance with the terms of this Agreement and to perform its obligations
hereunder.
ARTICLE 5
COVENANTS OF THE COMPANY
5.1 Conduct of Business. From the date hereof through the
Closing Date, the Company and its Subsidiaries shall conduct their businesses in
the ordinary course, consistent with past practice and generally in a manner
such that the representations and warranties
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contained in Article 3 shall continue to be true and correct in all material
respects on and as of the Closing Date (except for representations and
warranties made as of a specific date) as if made on and as of the Closing Date.
The Company shall give the Purchasers prompt notice of any event, condition or
circumstance occurring from the date hereof through the Closing Date that would
constitute a violation or breach of (i) any representation or warranty, whether
made as of the date hereof or as of the Closing Date, or (ii) any covenant of
the Company contained in this Agreement; provided, however, that no such
notification shall relieve or cure any such breach or violation of any such
representation, warranty or covenant or otherwise affect the accuracy of any
such representation or warranty for the purposes of Section 7.1.
5.2 Indemnification of Brokerage. The Company represents and
warrants to the Purchasers that no broker, finder, agent or similar intermediary
(a "Broker") has acted on behalf of the Company or its Subsidiaries in
connection with this Agreement or the Contemplated Transactions, and that there
are no brokerage commissions, finder's fees or similar fees or commissions
payable in connection therewith based on any agreement, arrangement or
understanding with the Company or any of the Subsidiaries or any action taken by
the Company or any of its Subsidiaries.
5.3 Rule 144. The Company shall file all reports required to
be filed by it under the Securities Act and the Exchange Act and shall take such
further action as the Purchasers may reasonably request, all to the extent
required to enable the Purchasers to sell the Common Stock into which the
Purchased Shares may be converted pursuant to and in accordance with Rule 144.
Such action shall include, but not be limited to, making available adequate
current public information meeting the requirements of paragraph (c) of Rule
144.
5.4 HSR Approval. Promptly upon execution and delivery (and
in any event within five (5) Business Days of the date of this Agreement), the
Purchasers and the Company will prepare and file, or cause to be prepared and
filed, with the appropriate Governmental Authorities, the requisite notification
with respect to the Contemplated Transactions pursuant to the HSR Act.
Thereafter, the Purchasers and the Company shall promptly supply all information
requested by Governmental Authorities in connection with the HSR Act
notification and cooperate with each other in responding to any such request,
and the Company shall use all reasonable efforts to cause the applicable HSR Act
waiting periods to be terminated early or to expire without further inquiry or
extension of time by any Governmental Authority and otherwise to cause the HSR
Requirements to be satisfied, including by supplying all information requested
by Governmental Authorities in connection therewith, and to cooperate with the
Purchasers in connection with the satisfaction of the HSR Requirements and the
HSR Act generally.
5.5 No Rights Plan. From the date hereof through the first
date on which shares of Series A Preferred Stock are convertible into Class A
Common Stock pursuant to the Certificate of Designations, and thereafter for so
long as the Purchasers collectively beneficially own Common Stock representing
at least 5% of the total voting power of the Company (assuming conversion of all
shares of Series A Preferred Stock into Class A Common Stock, regardless of
whether such shares are actually then convertible), the Company shall not adopt
or enter into any "poison pill" rights plan or any similar plan or agreement or
declare or pay any dividend of any rights to purchase capital stock of the
Company in connection with such a plan
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or agreement unless such plan or agreement would permit the Purchasers, their
Affiliates and their managed accounts to beneficially own, in the aggregate, all
of the shares of capital stock of the Company then owned or held by them at such
time plus an additional number of shares of capital stock representing an
additional 5% of the total voting power of the Company without causing or
triggering any adverse consequences to the Purchasers or otherwise giving rise
to any rights in any other person (including any of the Company's stockholders)
as a result thereof.
ARTICLE 6
COVENANTS OF THE PURCHASER
6.1 Indemnification of Brokerage. The Purchasers covenant that
no Broker has acted on behalf of any Purchaser in connection with this Agreement
or the Contemplated Transactions, and that there are no brokerage commissions,
finders' fees or similar fees or commissions payable in connection therewith
based on any agreement, arrangement or understanding with any Purchaser, or any
action taken by any Purchaser. Each Purchaser agrees to indemnify and hold
harmless the Company from any Action or demand for commission or other
compensation by any Broker claiming to have been employed by or on behalf of
such Purchaser, and to bear the cost of legal expenses incurred in defending
against any such claim.
ARTICLE 7
CONDITIONS PRECEDENT TO THE OBLIGATION
OF THE PURCHASERS TO CLOSE
The obligations of the Purchasers to enter into and complete
the Closing are subject to the fulfillment on or prior to the Closing Date of
the following conditions, any one or more of which may be waived by the
Purchasers:
7.1 Representations and Covenants. The representations and
warranties of the Company contained in this Agreement shall be true and correct
in all material respects (other than those which are qualified as to
materiality, Material Adverse Effect or other similar term, which shall be true
and correct in all respects) on and as of the Closing Date with the same force
and effect as though made on and as of the Closing Date; the Company shall have
performed and complied with all covenants and agreements required by this
Agreement to be performed or complied with by the Company on or prior to the
Closing Date; and the Company shall have delivered to the Purchasers a
certificate, dated the date of the Closing and signed by an executive officer of
the Company, to the foregoing effect.
7.2 Filing of Certificate of Designations. The Certificate of
Designations of the Series A Preferred Stock in the form attached hereto as
Exhibit A shall have been filed with the Office of the Secretary of State of the
State of Delaware in accordance with Section 242 of the DGCL.
7.3 Opinion of Counsel to the Company. The Purchasers shall
have received the legal opinion of Xxxxxxxx Xxxxxxx LLP, counsel to the Company,
dated the Closing Date, addressed to the Purchaser, in a form reasonably
acceptable to the Purchasers and such counsel.
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7.4 No Actions. (a) No Action shall be pending by or before
any Governmental Authority (including investigations instituted by the United
States Department of Justice or the Federal Trade Commission in connection with
antitrust regulations) to restrain or prohibit this Agreement or the
consummation of the Contemplated Transactions.
(b) No law, order, decree, rule or injunction shall have
been enacted, entered, promulgated or enforced by any Governmental Authority
that prohibits or makes illegal the consummation of any of the Contemplated
Transactions.
7.5 NYSE Listing. The shares of Class A Common Stock issuable
upon conversion of the Purchased Shares shall have been approved for listing on
the NYSE, subject only to official notice of issuance.
ARTICLE 8
CONDITIONS PRECEDENT TO THE OBLIGATION
OF THE COMPANY TO CLOSE
The obligation of the Company to enter into and complete the
Closing is subject to the fulfillment on or prior to the Closing Date of the
following conditions, any one or more of which may be waived by the Company:
8.1 Representations and Covenants. The representations and
warranties of the Purchasers contained in this Agreement shall be true and
correct in all material respects on and as of the Closing Date with the same
force and effect as though made on and as of the Closing Date; the Purchasers
shall have performed and complied with all covenants and agreements required by
this Agreement to be performed or complied with by them on or prior to the
Closing Date; and the Purchasers shall have delivered to the Company a
certificate, dated the date of the Closing and signed by a general partner of
each Purchaser, to the foregoing effect.
8.2 No Actions. (a) No Action shall be pending by or before
any Governmental Authority (including investigations instituted by the United
States Department of Justice or the Federal Trade Commission in connection with
antitrust regulations) to restrain or prohibit this Agreement or the
consummation of the Contemplated Transactions.
(b) No law, order, decree, rule or injunction shall have
been enacted, entered, promulgated or enforced by any Governmental Authority
that prohibits or makes illegal the consummation of any of the Contemplated
Transactions.
ARTICLE 9
REGISTRATION RIGHTS; PREEMPTIVE RIGHTS
9.1 Requested Registration. (a) If the Company shall receive
from Holders of Registrable Securities or Purchased Shares representing, in the
aggregate, at least a majority of the Registrable Securities (which calculation
shall include all Registrable Securities then outstanding and all Registrable
Securities into which all shares of Series A Preferred Stock then outstanding
may be converted), a written request (which shall specify whether the
distribution
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will be made by means of an underwriting) that the Company effect a registration
(a "Demand Notice") with respect to all or a part of the Registrable Securities,
which Demand Notice shall request registration of a number of shares of Class A
Common Stock reasonably expected to have an aggregate selling price of
$20,000,000.00 or more, the Company will, as soon as practicable, use its
reasonable best efforts to effect such registration under the Securities Act
(which shall be a "shelf" registration statement pursuant to Rule 415 under the
Securities Act (or a successor provision), if so requested by the Holders of a
majority of the Registrable Securities specified in the Demand Notice and if the
Company is eligible therefor at such time) as may be so requested and as would
permit or facilitate the sale and distribution of the Registrable Securities as
are specified in such request; provided, however, that the Company shall not be
required to effect any registration requested pursuant to this Section 9.1(a) if
at the time the Demand Notice is received (i) the shares are eligible for sale
and capable of being sold at such time pursuant to Rule 144 promulgated under
the Securities Act and (ii) the number of shares of Class A Common Stock sought
to be included in such registration does not exceed 1% of the number of shares
of such class outstanding. After the Company has effected two (2) such
registrations pursuant to this Section 9.1(a), the related Registration
Statements have been declared effective and the distribution contemplated
thereunder completed, the Company shall have no further obligation under this
Section 9.1(a).
(b) Section 9.1(a) notwithstanding, if the Company shall
furnish to Holders who have elected to exercise their rights under Section
9.1(a) (each, a "Section 9.1 Exercising Holder") a certificate signed by the
President or the Chief Executive Officer of the Company stating that, in the
good faith judgment of the Board of Directors of the Company, disclosure of
certain information that would otherwise be required to be disclosed in a
Registration Statement to be filed pursuant to Section 9.1(a) would be seriously
detrimental to the Company, and it is therefore desirable and in the best
interests of the Company to defer the filing of such registration statement,
then the Company shall have the right to defer such filing for a period of time
after receipt of such request; provided, however, that the Company may not defer
such filing more than once in any 12-month period and the aggregate period of
time during any such 12-month which the Company may defer such filing shall not
exceed 90 days.
(c) If the Company or any stockholder, other than a
Section 9.1 Exercising Holder, wishes to offer any of its securities in
connection with any registration initiated pursuant to this Section 9.1, no such
securities may be offered by the Company or such other stockholder without the
consent of the Holders of a majority of the Registrable Securities specified in
the Demand Notice related to such offering.
(d) In connection with any underwritten offering
pursuant to this Section 9.1, Section 9.1 Exercising Holders shall have the
right to select the underwriter or underwriters, which shall be a nationally
recognized investment banking firm or firms reasonably acceptable to the
Company; provided that for so long as the Purchasers together hold at least a
majority of the Registrable Securities, GSCPIII shall have the right, in its
sole discretion, to select an underwriter or underwriters on behalf of the
Exercising Holders. If Xxxxxxx, Sachs & Co. is selected as an underwriter,
Xxxxxxx, Xxxxx & Co. shall appoint a qualified independent underwriter, if
necessary.
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9.2 Company Registration. (a) If the Company shall determine
to register any shares of Common Stock for the account of the Company, a
security holder or holders or otherwise (other than a registration relating
solely to employee benefit plans, or a registration relating solely to a merger,
exchange offer or a transaction of the type specified in Rule 145(a) under the
Securities Act), the Company will promptly deliver to each of the Holders a
written notice of such proposed transaction at least 20 Business Days prior to
the filing of a registration statement and include in such registration, and in
any underwriting involved therein, all the Registrable Securities specified in
written requests made by Holders within ten Business Days after receipt of the
written notice from the Company described above. Each Holder shall be entitled
to have its shares included in an unlimited number of registrations pursuant to
this Section 9.2.
(b) If the registration of which the Company gives notice
is for a registered public offering involving an underwriting, the Company shall
so advise the Holders as a part of the written notice given pursuant to Section
9.2(a). In such event, the right of each Holder to registration pursuant to
Section 9.2(a) shall be conditioned upon such Holder's participation in such
underwriting and the inclusion of the Registrable Securities in the underwriting
to the extent provided herein. If the Holders shall have elected to exercise
their rights under Section 9.2(a) (each, a "Section 9.2 Exercising Holder," and,
together with the Section 9.1 Exercising Holders, the "Exercising Holders"),
they shall enter into an underwriting agreement in customary form with the
representative of the underwriter or underwriters selected for underwriting by
the Company. Notwithstanding any other provision of this Section 9.2, if the
representative determines and so advises the Company in writing that marketing
factors require a limitation on the number of shares to be underwritten, the
Company shall so advise the Section 9.2 Exercising Holders and any other Person
(other than the Company) registering shares under such registration. In such an
event, the number of Registrable Securities that may be included in the
registration and underwriting by the Section 9.2 Exercising Holders and each
other Person (other than the Company) registering shares under such
registration, shall be reduced, on a pro rata basis (based on the number of
shares of Common Stock requested to be included by each such Section 9.2
Exercising Holder (counting shares of Series A Preferred Stock on an
as-converted-to-common basis) and each other Person (other than the Company)
registering shares under such registration), by such minimum number of shares as
is necessary to comply with such limitation. If a Section 9.2 Exercising Holder
disapproves of the terms of any such underwriting, it may elect to withdraw
therefrom by written notice to the Company and the underwriter. Any Registrable
Securities excluded or withdrawn from such underwriting shall be withdrawn from
such registration.
9.3 Transferability. Each Transferee of Registrable
Securities wishing to participate as an Exercising Holder in any registration
pursuant to Section 9.1 or 9.2 shall, prior thereto, execute and deliver to the
Company a letter agreement (and shall cause each other Person to whom it assigns
its registration rights under this Article 9 to execute and deliver to the
Company a similar letter agreement) in form and substance satisfactory to the
Company, pursuant to which such Transferee (or such other Person or Persons to
whom it assigns its registration rights under this Article 9) agrees to comply
with the requirements of this Article 9 (including this sentence) to the same
extent and subject to the same terms and conditions as a Purchaser.
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9.4 Expenses of Registration . The Company shall pay all
Registration Expenses in connection with each registration of Registrable
Securities requested pursuant to this Article 9; provided, however, that each
Exercising Holder shall pay all underwriting discounts and commissions and
transfer taxes, if any, relating to the sale or disposition of such Holder's
Registrable Securities pursuant to a Registration Statement effected pursuant to
this Article 9.
9.5 Registration Procedures . In the case of each registration
effected by the Company pursuant to Article 9, the Company will:
(a) prepare and file with the Commission, as promptly as
practicable, the requisite Registration Statement with respect to such
Registrable Securities and use its reasonable best efforts to cause such
registration statement to become and remain effective;
(b) (i) prepare and file with the Commission such
amendments and supplements to such Registration Statement and the Prospectus
used in connection therewith as may be necessary to keep such Registration
Statement continuously effective (but, in the case of a Registration Statement
that is not a "shelf" registration, only for the period of time reasonably
necessary to permit the Exercising Holders to dispose of all the Registrable
Securities included in such offering) and (ii) comply with the provisions of the
Securities Act with respect to the sale or other disposition of all securities
covered by such Registration Statement during such period;
(c) furnish to the Exercising Holders prior to the
filing of the requisite Registration Statement copies of drafts of such
Registration Statement as is proposed to be filed (and give such Exercising
Holders and their counsel a reasonable opportunity to comment on such
documents), and thereafter such number of copies of such Registration Statement,
each amendment and supplement thereto (in each case including all exhibits
thereto), the Prospectus included in such Registration Statement (including each
preliminary prospectus) and such other documents in such quantities as the
Exercising Holders may reasonably request from time to time in order to
facilitate its distribution;
(d) notify the Exercising Holders promptly of any
request by the Commission for the amending or supplementing of such Registration
Statement or Prospectus or for additional information and promptly deliver to
the Exercising Holders and their counsel copies of any comments received from
the Commission;
(e) notify the Exercising Holders, promptly after the
Company shall receive notice thereof, of the time when the Registration
Statement becomes effective or when any amendment or supplement or any
Prospectus forming a part of the Registration Statement has been filed;
(f) advise the Exercising Holders promptly after the
Company shall receive notice or obtain knowledge of the issuance of any stop
order by the Commission suspending the effectiveness of any such Registration
Statement or amendment thereto or of the initiation or threatening of any
proceeding for that purpose, and promptly use its best efforts to prevent the
issuance of any stop order or to obtain its withdrawal promptly if such stop
order should be issued;
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(g) use all reasonable efforts to register or qualify
the Registrable Securities under such other securities or blue sky laws of such
jurisdictions as the Exercising Holders (or the managing underwriter, in the
case of underwritten offerings) reasonably request; provided that the Company
shall not be required to qualify to do business or become subject to service of
process or taxation in any jurisdiction in which it is not already so qualified
or subject;
(h) use all reasonable efforts, including filing any
necessary listing applications with any securities exchange or Nasdaq, to cause
the Registrable Securities included in the Registration Statement to be listed
on any securities exchange or authorized for quotation on any national quotation
system on which any of the Common Stock is then listed;
(i) notify the Exercising Holders, at any time when a
Prospectus relating to the proposed sale is required to be delivered under the
Securities Act, of the happening of any event as a result of which the
Prospectus included in such Registration Statement or amendment contains an
untrue statement of a material fact or omits to state any material fact required
to be stated therein in order to make the statements therein, in light of the
circumstances under which they were made, not misleading, and the Company will
prepare a supplement or amendment to such Prospectus so that, as thereafter
delivered to the purchasers of the Registrable Securities, such Prospectus will
not contain an untrue statement of a material fact or omit to state any material
fact required to be stated therein in order to make the statements therein, in
light of the circumstances under which they were made, not misleading;
(j) enter into customary agreements (including without
limitation, an underwriting agreement in customary form) and take such other
actions as are reasonably required in order to expedite or facilitate the
disposition of the Registrable Securities included in the Registration
Statement;
(k) in the case of a Registration Statement filed
pursuant to Section 9.1 involving a shelf Registration Statement, prepare and
file with the Commission such amendments and supplements to such shelf
Registration Statement and the Prospectus used in connection therewith as may be
necessary to keep such shelf Registration Statement effective until the earlier
of (i) the sale of all Registrable Securities covered thereby or (ii) the second
anniversary of the initial date of the effectiveness of such shelf Registration
Statement, and to comply with the provisions of the Securities Act with respect
to the sale or other disposition of all Registrable Securities covered by such
Registration Statement;
(l) make available, upon reasonable prior notice and
during normal business hours in New York City, for inspection by Exercising
Holders, any underwriter participating in any disposition pursuant to the
Registration Statement and any attorney, accountant or other agent retained by
the Exercising Holders or any such underwriter all relevant financial and other
records, pertinent corporate documents and properties of the Company and cause
the Company's officers, directors and employees, upon reasonable prior notice
and during normal business hours in New York City, to supply all relevant
information reasonably requested by the Exercising Holders or any such
underwriter, attorney, accountant or agent in connection with the Registration
Statement;
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(m) request the Company's independent public accountants
to provide to the underwriters, if any, and the Exercising Holders, if
permissible, a comfort letter in customary form and covering such matters of the
type customarily covered by comfort letters to underwriters in connection with
public offerings;
(n) cooperate and assist in any filings required to be
made with the NASD and in the performance of any due diligence investigation by
any underwriter in an underwritten offering; and
(o) use all reasonable efforts to facilitate the
distribution and sale of any Registrable Securities to be offered pursuant to
this Agreement, including without limitation by making road show presentations,
holding meetings with potential investors and taking such other actions as shall
be requested by the Exercising Holders of Registrable Securities covered by a
Registration Statement or the lead managing underwriter of an underwritten
offering.
9.6 Indemnification. (a) In the event of any registration of
any Registrable Securities pursuant to this Article 9, the Company will, and
hereby does, indemnify and hold harmless, to the fullest extent permitted by
law, each Exercising Holder, its directors, officers, members, managers,
managing directors, fiduciaries, employees and stockholders or general and
limited partners (and the directors, officers, members, managers, managing
directors, fiduciaries, employees and stockholders or general and limited
partners thereof), each other Person who participates as an underwriter or a
qualified independent underwriter, if any, in the offering or sale of such
securities, each director, officer, members, managers, fiduciary, managing
director, employee and stockholder or general and limited partner of such
underwriter or qualified independent underwriter, and each other Person
(including any such Person's directors, officers, members, managers, managing
directors, fiduciaries, employees and stockholders or general and limited
partners), if any, who controls such seller or any such underwriter or qualified
independent underwriter, within the meaning of the Securities Act, against any
and all Claims in respect thereof and expenses (including reasonable fees and
expenses of counsel and any amounts paid in any settlement effected with the
Company's consent, which consent shall not be unreasonably withheld or delayed)
to which each such indemnified party may become subject under the Securities
Act, the Exchange Act or otherwise, insofar as such Claims or expenses arise out
of or are based upon any of the following actual or alleged statements,
omissions or violations (each, a "Violation"): (i) any untrue statement or
alleged untrue statement of a material fact contained in any Registration
Statement under which such securities were registered pursuant to this Agreement
under the Securities Act or the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading, (ii) any untrue statement or alleged untrue statement of a material
fact contained in any preliminary, final or summary prospectus or any amendment
or supplement thereto, together with the documents incorporated by reference
therein, or the omission or alleged omission to state therein a material fact
required to be stated therein or necessary in order to make the statements
therein, in light of the circumstances under which they were made, not
misleading, or (iii) any violation by the Company of any federal, state or
common law rule or regulation applicable to the Company and relating to action
required of or inaction by the Company in connection with any such registration,
and the Company will reimburse any such indemnified party for any legal or other
expenses reasonably incurred by such indemnified party in connection with
investigating or
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defending any such Claim as such expenses are incurred; provided, that the
Company shall not be liable to any such indemnified party in any such case to
the extent such Claim or expense arises out of or is based upon any Violation
which occurs in reliance upon and in conformity with written information
furnished to the Company or its representatives by or on behalf of such
indemnified party expressly stating that such information is for use therein.
(b) Each Exercising Holder will, if Registrable
Securities held by it are included in the securities as to which such
registration, qualification or compliance is being effected, severally and not
jointly, indemnify and hold harmless (in the same manner and to the same extent
as set forth in paragraph (a) of this Section 9.6), to the extent permitted by
law, the Company, its directors, officers, fiduciaries, employees and
stockholders (and the directors, officers, fiduciaries, employees and
stockholders or general and limited partners thereof) and each Person (including
any such Person's directors, officers, fiduciaries, employees and stockholders
or general and limited partners), if any, controlling the Company within the
meaning of the Securities Act and all other prospective sellers in such
registration and their directors, officers, fiduciaries, employees and
stockholders or general and limited partners and respective controlling Persons
(including any such Person's directors, officers, fiduciaries, employees and
stockholders or general and limited partners) against any and all Claims and
expenses (including reasonable fees and expenses of counsel and any amounts paid
in any settlement effected with the consent of the indemnifying party, which
consent shall not be unreasonably withheld or delayed) to which each such
indemnified party may become subject under the Securities Act, the Exchange Act
or otherwise, insofar as such Claims or expenses arise out of or are based upon
any Violation which occurs in reliance upon and in conformity with written
information furnished to the Company or its representatives by or on behalf of
such Exercising Holder or underwriter or qualified independent underwriter, if
any, expressly stating that such information is for use in connection with any
Registration Statement, preliminary, final or summary prospectus or amendment or
supplement or document incorporated by reference into any of the foregoing;
provided, however, that the aggregate amount which any such Exercising Holder
shall be required to pay pursuant to this Section 9.6(b) and Sections 9.6(c) and
(e) shall be limited to the amount of the net proceeds received by such
Exercising Holder upon the sale of the Registrable Securities pursuant to the
Registration Statement giving rise to such claim.
(c) Indemnification similar to that specified in the
preceding paragraphs (a) and (b) of this Section 9.6 (with appropriate
modifications) shall be given by the Company and each Exercising Holder (if
Registrable Securities held by it are included in the securities as to which
such registration, qualification or compliance is being effected), severally and
not jointly, with respect to any required registration or other qualification of
securities under any state securities and "blue sky" laws.
(d) Any Person entitled to indemnification under this
Agreement shall notify promptly the indemnifying party in writing of the
commencement of any Action or proceeding with respect to which a claim for
indemnification may be made pursuant to this Section 9.6, but the failure of any
indemnified party to provide such notice shall not relieve the indemnifying
party of its obligations under the preceding paragraphs of this Section 9.6,
except to the extent the indemnifying party is actually materially prejudiced
thereby, and shall not relieve the indemnifying party from any liability which
it may have to any indemnified party otherwise than under this Section 9.6. In
case any action or proceeding is brought against an
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indemnified party and it shall notify the indemnifying party of the commencement
thereof, the indemnifying party shall be entitled to participate therein and,
unless in the reasonable opinion of outside counsel to the indemnified party a
conflict of interest between such indemnified and indemnifying parties may exist
in respect of such claim, to assume the defense thereof jointly with any other
indemnifying party similarly notified, to the extent that it chooses, with
counsel reasonably satisfactory to such indemnified party, and after notice from
the indemnifying party to such indemnified party that it so chooses, the
indemnifying party shall not be liable to such indemnified party for any legal
or other expenses subsequently incurred by such indemnified party in connection
with the defense thereof other than reasonable costs of investigation; provided,
however, that (i) if the indemnifying party fails to take reasonable steps
necessary to defend diligently the action or proceeding within twenty (20) days
after receiving notice from such indemnified party that the indemnified party
believes it has failed to do so; or (ii) if such indemnified party who is a
defendant in any action or proceeding which is also brought against the
indemnifying party reasonably shall have concluded that there may be one or more
legal defenses available to such indemnified party which are not available to
the indemnifying party; or (iii) if representation of both parties by the same
counsel is otherwise inappropriate under applicable standards of professional
conduct, then, in any such case, the indemnified party shall have the right to
assume or continue its own defense as set forth above (but with no more than one
firm of counsel for all indemnified parties in each jurisdiction, except to the
extent any indemnified party or parties reasonably shall have concluded that
there may be legal defenses available to such party or parties which are not
available to the other indemnified parties or to the extent representation of
all indemnified parties by the same counsel is otherwise inappropriate under
applicable standards of professional conduct) and the indemnifying party shall
be liable for any expenses therefor. No indemnifying party shall, without the
written consent of the indemnified party, which consent shall not be
unreasonably withheld, effect the settlement or compromise of, or consent to the
entry of any judgment with respect to, any pending or threatened action or claim
in respect of which indemnification or contribution may be sought hereunder
(whether or not the indemnified party is an actual or potential party to such
action or claim) unless such settlement, compromise or judgment (A) includes an
unconditional release of the indemnified party from all liability arising out of
such action or claim, (B) does not include a statement as to or an admission of
fault, culpability or a failure to act, by or on behalf of any indemnified party
and (C) does not include any injunctive or other non-monetary relief.
(e) If for any reason the foregoing indemnity is
unavailable or is insufficient to hold harmless an indemnified party under
Section 9.6(a), (b) or (c), then each indemnifying party shall contribute to the
amount paid or payable by such indemnified party as a result of any Claim in
such proportion as is appropriate to reflect the relative fault of the
indemnifying party on the one hand and the indemnified party on the other from
the relevant offering of securities. If, however, the allocation provided in the
immediately preceding sentence is not permitted by applicable law, or if the
indemnified party failed to give the notice required by Section 9.6(d) above and
the indemnifying party is prejudiced thereby, then each indemnifying party shall
contribute to the amount paid or payable by such indemnified party in such
proportion as is appropriate to reflect not only such relative fault of but also
the relative benefits received by the indemnifying party, on the one hand, and
the indemnified party, on the other hand, as well as any other relevant
equitable considerations. The relative fault shall be determined by reference
to, among other things, whether the Violation relates to information supplied by
the indemnifying party or the indemnified party and the parties' relative
intent,
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knowledge, access to information and opportunity to correct or prevent such
Violation. The parties hereto agree that it would not be just and equitable if
contributions pursuant to this Section 9.6(e) were to be determined by pro rata
allocation or by any other method of allocation which does not take account of
the equitable considerations referred to in the preceding sentences of this
Section 9.6(e). The amount paid or payable in respect of any Claim shall be
deemed to include any legal or other expenses reasonably incurred by such
indemnified party in connection with investigating or defending any such Claim.
No person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Securities Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation. Notwithstanding
anything in this Section 9.6(e) to the contrary, no indemnifying party (other
than the Company) shall be required pursuant to this Section 9.6(e) to
contribute any amount in excess of (x) in the case of an indemnifying party that
is a Holder of Registrable Securities, the net proceeds received by such
indemnifying party from the sale of Registrable Securities in the offering to
which the losses, claims, damages or liabilities of the indemnified parties
relate, or (y) in the case of an indemnifying party that is an underwriter or a
qualified independent underwriter, the amount of the commission received by it
in connection with the offering to which the losses, claims, damages or
liabilities of the indemnified parties relate, less, in any such case referred
to in (x) and (y), the amount of all indemnification and contribution payments
made pursuant to Sections 9.6(b) and (c) and this Section 9.6(e), as the case
may be, in connection with such offering.
(f) The indemnity agreements contained herein shall be
in addition to any other rights to indemnification or contribution which any
indemnified party may have pursuant to law or contract and shall remain
operative and in full force and effect regardless of any investigation made or
omitted by or on behalf of any indemnified party and shall survive the Transfer
of the Registrable Securities by any such party.
(g) The indemnification and contribution required by
this Section 9.6 shall be made by periodic payments of the amount thereof during
the course of the investigation or defense, as and when bills are received or
expense, loss, damage or liability is incurred.
(h) In connection with underwritten offerings, the
Company will use reasonable best efforts to negotiate terms of indemnification
that are reasonably favorable to the various sellers pursuant thereto, as
appropriate under the circumstances, and that are no less favorable to such
sellers than the terms contained in this Section 9.6.
9.7 Holdback Agreement. (a) If requested in writing by the
Company or the underwriter, if any, of any offering affording Holders of
Registrable Securities registration rights pursuant to Section 9.2 each Holder
agrees not to effect any public sale or distribution, including any sale
pursuant to Rule 144, of any Registrable Securities or any other equity security
of the Company or of any security convertible into or exchangeable or
exercisable for any equity security of the Company (in each case, other than as
part of such underwritten public offering) within fourteen (14) days before or
90 days after the effective date of a Registration Statement affording Holders
registration rights pursuant to Section 9.2, or for such shorter period as the
sole or lead managing underwriter shall request, in any such case, unless
consented to by such underwriter.
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(b) If requested in writing by the underwriter of any
offering in connection with any registration pursuant to Section 9.1, the
Company agrees not to effect any public sale or distribution (other than public
sales or distributions solely by and for the account of the Company of
securities issued (x) pursuant to any employee or director benefit or similar
plan or any dividend reinvestment plan or (y) in any acquisition by the Company)
of any Registrable Securities or any other equity security of the Company or of
any security convertible into or exchangeable or exercisable for any equity
security of the Company (in each case, other than as part of such underwritten
public offering), within fourteen (14) days before or 90 days after the
effective date of a registration statement filed in connection with a
registration pursuant to Section 9.1, or for such shorter period as the sole or
lead managing underwriter shall request, in any such case, unless consented to
by such underwriter.
9.8 Other Registration Rights. The Company shall not grant
any right of registration under the Securities Act relating to any of its
securities to any Person other than the Purchasers if such rights would or could
reasonably be expected to frustrate, impede or limit the Purchasers' rights
pursuant to Section 9.2.
9.9 Preemptive Rights. (a) From the Closing Date through the
date on which shares of Series A Preferred Stock first become convertible into
shares of Class A Common Stock pursuant to the Certificate of Designations, and
thereafter for so long as the Purchasers collectively beneficially own (assuming
conversion of all shares of Series A Preferred Stock into Class A Common Stock,
regardless of whether such shares are actually then convertible) not less than
5% of the total number of shares of Common Stock outstanding from time to time,
in the event the Company proposes to issue Common Stock of any kind (including
any warrants, options or securities or units comprising securities convertible
into or exchangeable for Common Stock or rights to acquire the same) of the
Company, other than (1) pursuant to a bona fide public offering to or through a
nationally recognized investment banking firm in which, to the Company's
knowledge, no single Person or its Affiliates (excluding members of the
underwriting syndicate, if an underwritten offering) purchases 10% or more of
the shares sold in such offering, (2) pursuant to an employee or non-management
director stock option plan, stock bonus plan, stock purchase plan or other
management equity program or plan, (3) pursuant to any merger, share exchange or
acquisition pursuant to which shares of Series A Common Stock are exchanged for,
or issued upon cancellation or conversion of, equity securities of an entity
engaged primarily in, or to acquire assets primarily for use in, the motion
picture exhibition business, or (4) securities issuable upon exercise of
previously issued warrants, options or other rights to acquire Common Stock or
upon conversion of previously issued securities convertible into Common Stock,
then the Company shall:
(i) deliver to the Purchasers written notice setting
forth in reasonable detail (1) the terms and provisions of the
securities proposed to be issued (the "Proposed Securities"); (2) the
price and other terms of the proposed sale of such securities; (3) the
amount of such securities proposed to be issued; and (4) such other
information as the Purchaser may reasonably request in order to
evaluate the proposed issuance; and
(ii) offer to issue to the Purchasers in the aggregate a
portion of the Proposed Securities equal to a percentage determined by
dividing (x) the number of shares of Common Stock beneficially owned by
the Purchasers (assuming conversion of
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all shares of Series A Preferred Stock into Class A Common Stock,
regardless of whether such shares are actually then convertible), by
(y) the total number of shares of Common Stock then outstanding.
The Purchasers must exercise the purchase rights hereunder within ten (10)
Business Days after receipt of such notice from the Company.
(b) Upon the expiration of the offering period described
above, or if the Purchasers shall default in paying for or purchasing the
Proposed Securities on the terms offered by the Company, the Company shall
thereafter be free to sell such Proposed Securities that the Purchaser has not
elected to purchase during the ninety (90) days following such expiration on
terms and conditions no more favorable to the purchasers thereof than those
offered to the Purchasers. Any Proposed Securities offered or sold by the
Company after such 90 day period must be reoffered to the Purchasers pursuant to
this Section 9.9.
(c) The election by the Purchasers not to exercise
preemptive rights under this Section 9.9 in any one instance shall not affect
its right (other than in respect of a reduction in its percentage holdings) as
to any subsequent proposed issuance. Any sale of such securities by the Company
without first giving the Purchasers the rights described in this Section 9.9
shall be void and of no force and effect, and the Company shall not register
such sale or issuance on the books and records of the Company.
ARTICLE 10
DIRECTOR DESIGNATION RIGHT
10.1 Directors. (a) From the HSR Clearance Date and for so
long as the Purchasers and their Affiliates collectively beneficially own a
number of shares of Common Stock (assuming conversion at such time of the
Purchased Shares (regardless of convertibility)) that is not less than 50% of
the number of shares of Common Stock beneficially owned (assuming conversion at
such time of the Purchased Shares regardless of convertibility) by them
immediately after the Closing (as such number may be adjusted for stock splits,
reverse stock splits, dividends paid in Common Stock, reclassifications of the
Common Stock, and other similar events), GSCPIII shall have the right to
designate, at all times and from time to time, two directors of the Company; and
(ii) for so long as the Purchasers and their Affiliates beneficially own a
number of shares of Common Stock (assuming conversion at such time of the
Purchased Shares (regardless of convertibility)) that is not less than 10% of
the number of shares of Common Stock beneficially owned (assuming conversion at
such time of the Purchased Shares (regardless of convertibility)) by them
immediately after the Closing (as such number may be adjusted for stock splits,
reverse stock splits, dividends paid in Common Stock, reclassifications of the
Common Stock, and other similar events), GSCPIII shall have the right to
designate, at all times and from time to time, one director of the Company.
Individuals designated pursuant to this paragraph shall be considered "Purchaser
Designees" for purposes of this Agreement. The Initial Designees elected
pursuant to paragraph (b) below shall be the initial Purchaser Designees.
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(b) Promptly upon expiration, termination or
satisfaction of the HSR Requirements (the "HSR Clearance Date"), each of the
Company and the Board of Directors shall take such action as may be necessary
(including seeking any necessary vote or approval of any stockholder of the
Company, taking any action necessary to expand the size of the Board of
Directors, or causing any existing director to resign in order to make room for
the Initial Designees) to cause the Initial Designees to be elected to the Board
of Directors, effective as of the HSR Clearance Date.
(c) If requested by GSCPIII, the Company will use
reasonable efforts (in accordance with the Certificate of Incorporation and
Bylaws of the Company and the DGCL) to cause the removal any Purchaser Designee
(in accordance with the Certificate of Incorporation and Bylaws of the Company
and the DGCL). Any vacancy among the Purchaser Designees caused by removal or by
the death, retirement or resignation of any Purchaser Designee shall be filled
by a Person designated by GSCPIII, and the Company agrees to take any such
action as is necessary, in accordance with the Certificate of Incorporation and
Bylaws of the Company and the DGCL, to cause such designee to be appointed or
elected to the Board of Directors. In the event that the term of any director
who at such time is a Purchaser Designee is to expire, then in connection with
any meeting of the Company's stockholders at which a successor to such director
is to be elected, the Company shall nominate a Purchaser Designee designated by
GSCPIII and shall recommend that stockholders vote in favor of such individual's
election to the Board of Directors in any proxy statement, information statement
or other communication to stockholders issued or disseminated by the Company. In
the event of any vacancy among the Purchaser Designees, the Board of Directors
shall not take any action not approved by the remaining Purchaser Designee (or
by the Purchasers if there be no remaining Purchaser Designee), during the
period from the time GSCPIII informs the Company of a designee to fill any such
vacancy to the time such designee is duly appointed or elected to the Board of
Directors.
(d) GSCPIII and the Company agree that one Purchaser
Designee shall have the right, but not the obligation, to sit on each committee
of the Board of Directors.
ARTICLE 11
TERMINATION OF AGREEMENT
11.1 Termination. (a) This Agreement may be terminated prior
to the Closing as follows:
(i) by either the Purchasers or the Company if the
Closing shall not have occurred before December 31, 1998; provided,
however, that the right to terminate this Agreement under this Section
11.1(a) shall not be available to any party whose failure to perform
any covenant or obligation under this Agreement or willful breach of a
representation or warranty has been the cause of or resulted in the
failure of the Closing to occur on or before such date.
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(ii) at the election of the Purchasers, if prior to
the Closing Date there shall have been a breach of any of the Company's
representations, warranties, covenants or agreements, which breach
would result in the failure to satisfy any of the conditions set forth
in Section 7.1, and such breach shall be incapable of being cured or,
if capable of being cured, shall not have been cured within 15 days
after written notice thereof shall have been received by the Company;
(iii) at the election of the Company, if prior to the
Closing Date there shall have been a breach of any of the Purchasers'
representations, warranties, covenants or agreements, which breach
would result in the failure to satisfy any of the conditions set forth
in Section 8.1, and such breach shall be incapable of being cured or,
if capable of being cured, shall not have been cured within 15 days
after written notice thereof shall have been received by the
Purchasers;
(iv) at the election of the Company or the
Purchasers, if any legal proceeding is commenced and pending by any
Governmental Authority seeking to prevent the consummation of the
Closing or any other Contemplated Transaction and the Company or the
Purchasers, as the case may be, reasonably and in good xxxxx xxxx it
impracticable or inadvisable to proceed in view of such legal
proceeding; or
(v) at any time on or prior to the Closing Date, by
mutual written consent of the Company and the Purchasers.
(b) If this Agreement so terminates, it shall become
null and void and have no further force or effect, except as provided in Section
11.2.
11.2 Survival After Termination. If this Agreement terminates
pursuant to Section 11.1 and the Contemplated Transactions are not consummated,
this Agreement shall become null and void and have no further force or effect,
except that any such termination shall be without prejudice to the rights of any
party on account of the nonsatisfaction of the conditions set forth in Articles
7 and 8 resulting from the intentional or willful breach or violation of the
representations, warranties, covenants or agreements of another party under this
Agreement. Notwithstanding anything in this Agreement to the contrary, the
provisions of Sections 5.2 and 6.1, this Section 11.2 and Sections 12.2, 12.8
and 12.10 shall survive any termination of this Agreement.
ARTICLE 12
MISCELLANEOUS
12.1 Survival. None of the representations and warranties set
forth in either of Article 3 or Article 4 shall survive the Closing. All other
agreements, obligations and covenants of any party set forth in this Agreement
shall survive the Closing indefinitely unless earlier terminated in accordance
with their terms.
12.2 Expenses. (a) The Company shall pay its own expenses
incurred in connection with the negotiation, execution, delivery, performance
and consummation of this Agreement.
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(b) Unless this Agreement is terminated pursuant to
Section 11.1(a)(iii), the Company shall reimburse each of the Purchasers for the
out-of-pocket expenses of the Purchasers or any of their Affiliates (whether or
not incurred prior to the date hereof), including, without limitation, the fees,
disbursements and other reasonable expenses of attorneys, accountants and any
other advisors thereto, arising out of or relating to the negotiation,
execution, delivery, performance and consummation of this Agreement. Such
reimbursement shall be made not later than the third Business Day following the
later of (1) the Closing Date and (2) the date on which the Purchasers provide a
written statement of their expenses to the Company; provided, however, that if
this Agreement is terminated prior to the Closing Date other than pursuant to
Section 11.1(a)(iii), such reimbursement shall be made not later than the third
Business Day following the date on which the Purchasers provide a written
statement of their expenses to the Company. In addition, the Company shall
reimburse each of the Purchasers for the out-of-pocket expenses of the
Purchasers or any of their Affiliates (whether or not incurred prior to the date
hereof), including, without limitation, the fees, disbursements and other
reasonable expenses of attorneys, accountants and any other advisors thereto,
arising out of or relating to the negotiation, execution, delivery, performance
and consummation of any amendment to this Agreement or the Convertible Debt
Indenture (as defined in the Certificate of Designations attached hereto as
Exhibit A).
12.3 Notices. All notices or other communications required or
permitted hereunder shall be in writing and shall be delivered personally,
telecopied or sent by certified, registered or express mail, postage prepaid.
Any such notice shall be deemed given if delivered personally or telecopied, on
the date of such delivery, or if sent by reputable overnight courier, on the
first Business Day following the date of such mailing, as follows:
(a) if to the Company:
c/o CARMIKE CINEMAS, Inc.
0000 Xxxxx Xxxxxx
Xxxxxxxx, Xxxxxxx 00000
Attention: Xxxxxxx Xxx Champion, III
Telecopy: (000) 000-0000
with a copy to:
Xxxxxxxx Xxxxxxx LLP
000 Xxxxx Xxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxx 00000
Attention: Xxxxxxxx X. Xxxxxx
Telecopy: (000) 000-0000
(b) if to the Purchasers:
GS Capital Partners III, L.P.
00 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx
Attention: Xxx Xxxxx
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Telecopy: (000) 000-0000
with a copy to:
Wachtell, Lipton, Xxxxx & Xxxx
00 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxxx X. Xxxxxxx
Telecopy: (000) 000-0000
Any party may by notice given in accordance with this Section 12.3 designate
another address or person for receipt of notices hereunder.
12.4 Successors and Assigns. This Agreement shall inure to
the benefit of and be binding upon the successors and permitted assigns of the
parties hereto. Other than the parties hereto and their successors and permitted
assigns and, with respect to Article 9, any Exercising Holders, no Person is
intended to be a beneficiary of this Agreement. No party hereto may assign its
rights under this Agreement without the prior written consent of the other party
hereto; provided, however, that prior to the Closing, any Purchaser may assign
all or any portion of its rights hereunder (along with the corresponding
obligations) to any Affiliate of the Purchasers or by any Purchaser to its
security holders or partners. Any assignee of any Purchaser pursuant to the
proviso of the foregoing sentence shall be deemed to be a "Purchaser" for all
purposes of this Agreement.
12.5 Amendment and Waiver . (a) No failure or delay on the
part of the Company or the Purchasers in exercising any right, power or remedy
hereunder shall operate as a waiver thereof, nor shall any single or partial
exercise of any such right, power or remedy preclude any other or further
exercise thereof or the exercise of any other right, power or remedy. The
remedies provided for herein are cumulative and are not exclusive of any
remedies that may be available to the Company or the Purchasers at law, in
equity or otherwise.
(b) Any amendment, supplement or modification of or to
any provision of this Agreement and any waiver of any provision of this
Agreement shall be effective only if it is made or given in writing and signed
by the Company and each Purchaser.
12.6 Counterparts. This Agreement may be executed in any
number of counterparts and by the parties hereto in separate counterparts, all
of which when so executed shall be deemed to be an original and all of which
taken together shall constitute one and the same agreement.
12.7 Headings. The headings in this Agreement are for
convenience of reference only and shall not limit or otherwise affect the
meaning hereof.
12.8 GOVERNING LAW; EXCLUSIVE JURISDICTION. THIS AGREEMENT
SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
DELAWARE WITHOUT REGARD TO THE CONFLICTS OF LAW PRINCIPLES THEREOF WHICH WOULD
REQUIRE THE APPLICATION OF THE LAWS OF ANOTHER STATE. The parties hereby
irrevocably
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submit to the jurisdiction of the federal courts of the United States of America
located in the Borough of Manhattan, City of New York, State of New York (or, if
such federal courts shall not have jurisdiction over such matters, to the
jurisdiction of the state courts of the State of New York located in the Borough
of Manhattan, City of New York, State of New York) solely in respect of the
interpretation and enforcement of the provisions of this Agreement and in
respect of the Contemplated Transactions and hereby waive, and agree not to
assert, as a defense in any action, suit or proceeding for the interpretation or
enforcement hereof, that it is not subject thereto or that such action, suit or
proceeding may not be brought or is not maintainable in said courts or that the
venue thereof may not be appropriate or that this Agreement may not be enforced
in or by such courts, and the parties irrevocably agree that all claims with
respect to such action or proceeding shall be heard and determined in such a
federal or state court.
12.9 Severability. If any one or more of the provisions
contained herein, or the application thereof in any circumstance, is held
invalid, illegal or unenforceable in any respect for any reason, the validity,
legality and enforceability of any such provision in every other respect and of
the remaining provisions hereof shall not be in any way impaired, unless the
provisions held invalid, illegal or unenforceable shall substantially impair the
benefits of the remaining provisions hereof.
12.10 Entire Agreement. This Agreement, together with the
schedules and exhibits hereto, is intended by the parties as a final expression
of their agreement and intended to be a complete and exclusive statement of the
agreement and understanding of the parties hereto in respect of the subject
matter contained herein and therein. There are no restrictions, promises,
warranties or undertakings, other than those set forth or referred to herein or
therein. This Agreement, together with the schedules and exhibits hereto,
supersedes all prior agreements and understandings between the parties with
respect to such subject matter.
12.11 Further Assurances. Each of the parties shall execute
such documents and take, or cause to be taken, all appropriate action, and shall
do or cause to be done, all things necessary, proper or advisable under
applicable laws and regulations to consummate and make effective the
Contemplated Transactions and obtain any consents, exemptions, authorizations,
or other actions by, or give any notices to, or make any filings with, any
Governmental Authority or any other Person.
12.12 Public Announcements. Except to the extent required by
law or the regulations of any national securities exchange or the NASD, none of
the parties hereto will issue or make any reports, statements or releases to the
public with respect to this Agreement or the Contemplated Transactions (other
than communications among any of the Purchasers and any of the partners of any
partner of any Purchaser) without consulting the other parties, and, during the
period from the date hereof until thirty (30) days after the Closing Date,
without the approval of the other parties (such approval not to be unreasonably
withheld).
12.13 Specific Performance. The parties acknowledge that
money damages are not an adequate remedy for violations of this Agreement and
that any party may, in its sole discretion, apply to a court of competent
jurisdiction for specific performance or injunctive or such other relief as such
court may deem just and proper in order to enforce this Agreement or
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prevent any violation hereof and, to the extent permitted by applicable law,
each party waives any objection to the imposition of such relief or any
requirement for a bond.
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36
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed and delivered by their respective officers hereunto duly authorized as
of the date first above written.
CARMIKE CINEMAS, INC.
By: /s/ Xxxx X. Xxxxxxx, III
-----------------------------------------------------
Name: Xxxx X. Xxxxxxx, III
Title: S.V.P.
PURCHASERS: GS CAPITAL PARTNERS III, L.P.
By: GS Advisors III, L.P., its general partner
By: GS Advisors III, L.L.C., its general partner
By: /s/ Xxxxxxxxx X. Xxxxxxxxxx
-----------------------------------------
Name: Xxxxxxxxx X. Xxxxxxxxxx
Title: Managing Director
Attorney-in-Fact
GS CAPITAL PARTNERS III OFFSHORE, L.P.
By: GS Advisors III (Cayman), L.P., its general
partner
By: GS Advisors III, L.L.C., its general partner
By: /c/ Xxxxxxxxx X. Xxxxxxxxxx
------------------------------------------
Name: Xxxxxxxxx X. Xxxxxxxxxx
Title: Managing Director
Attorney-in-Fact
XXXXXXX XXXXX & CO. VERWALTUNGS GMBH
By: /s/ Xxxxxxxxx X. Xxxxxxxxxx
-----------------------------------------------------
Name: Xxxxxxxxx X. Xxxxxxxxxx
Title: Managing Director
Attorney-in-Fact
and
By: /s/ Xxxxxx Xxxxxxxxx
------------------------------------------------------
Name: Xxxxxx Xxxxxxxxx
Title: Vice President
Attorney-in-Fact
[FIRST SIGNATURE PAGE TO STOCK PURCHASE AGREEMENT]
37
THE XXXXXXX SACHS GROUP, L.P.
By: The Xxxxxxx Xxxxx Corporation, General Partner
By: /s/ Xxxxxxxxx X. Xxxxxxxxxx
------------------------------------------------
Name: Xxxxxxxxx X. Xxxxxxxxxx
Title: Managing Director
Attorney-in-Fact
[SECOND SIGNATURE PAGE TO STOCK PURCHASE AGREEMENT]