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Exhibit 2.2
AMENDMENT NO. 1 TO RECAPITALIZATION AGREEMENT
AMENDMENT NO. 1, dated as of October 2, 2000 (this
"Amendment"), to the Recapitalization Agreement and Plan of Merger, dated as of
May 31, 2000 (the "Recapitalization Agreement"), among TravelCenters of America,
Inc., TCA Acquisition Corporation, a Delaware corporation, Clipper Capital
Associates, L.P., a Delaware limited partnership, National Partners, L.P., a
Delaware limited partnership, National Partners III, L.P., a Delaware limited
partnership, Clipper/Merchant I, L.P., a Delaware limited partnership, Olympus
Private Placement Fund, L.P., a Delaware limited partnership, Olympus Growth
Fund II, L.P., a Delaware limited partnership. Terms defined in the
Recapitalization Agreement and used herein shall have the meanings given to them
in the Recapitalization Agreement.
WHEREAS, pursuant to the Recapitalization Agreement, the Board
of Directors of each of Purchaser and the Company have approved the merger of
Purchaser with and into the Company upon the terms and conditions set forth
therein; and
WHEREAS, the Purchaser has requested, and, upon this Amendment
becoming effective, the Company has agreed, that certain provisions of the
Recapitalization Agreement be amended in the manner provided for in this
Amendment.
NOW, THEREFORE, the parties hereto hereby agree as follows:
I. Amendments to Recapitalization Agreement.
1.1. Amendment to Section 1.01. Section 1.01 of the Recapitalization
Agreement is hereby amended by (a) deleting therefrom the defined term "Interest
Factor" in its entirety and (b) adding the following new defined term thereto in
its appropriate alphabetical order:
"Incremental Tender Cost" shall mean the amount by which (i)
the aggregate consideration paid by the Company for the
purchase of its outstanding 10 1/4% Senior Subordinated Notes
due 2007 pursuant to a tender offer exceeds (ii) the aggregate
consideration that would have been paid by the Company for the
purchase of such notes if such consideration had been
calculated by reference to a "tender offer yield" equal to the
sum of (x) the yield on the 6 5/8% U.S. Treasury Note due
March 31, 2002 plus (y) 75 basis points; provided that the
Incremental Tender Cost shall not exceed the difference
between (A) the aggregate consideration that would have been
paid by the Company for the purchase of such notes if such
consideration had been calculated by reference to a "tender
offer yield" equal to the sum of (x) the yield on the 6 5/8%
U.S. Treasury Note due March 31, 2002 plus (y) 50 basis points
and (B) the amount referred to in clause (ii) above.
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1.2. Amendments to Section 3.01.
(a) Clause (i) of Section 3.01 of the Recapitalization
Agreement is hereby amended by deleting such clause in its entirety and
substituting in lieu thereof the following new clause (i):
"Seven Hundred Twelve Million Two Hundred Thousand Dollars
($712,200,000.00)"; and
(b) Clause (vi) of Section 3.01 of the Recapitalization
Agreement is hereby amended by deleting such section in its entirety
and substituting in lieu thereof the following new clause (vi):
"plus an amount equal to 50% of the Incremental Tender Cost,
if any,".
1.3. Amendment to Section 3.03. Section 3.03 of the Recapitalization
Agreement is hereby amended as follows:
(a) by deleting the reference to "Five Million Dollars
($5,000,000)" in clause (i) of the second sentence thereof and
substituting in lieu thereof "Two Million Dollars ($2,000,000)"; and
(b) by deleting the reference to "Four Million Dollars
($4,000,000)" in clause (i) of the third sentence thereof and
substituting in lieu thereof "One Million Dollars ($1,000,000)".
1.4. Amendment to Section 9.02. Section 9.02(ii) of the
Recapitalization Agreement is hereby amended by deleting the date "October 4,
2000" from such section and substituting in lieu thereof the date "November 15,
2000".
1.5. Amendment to Exhibit A. Paragraph 1. "Escrow Deposits" contained
in Exhibit A to the Recapitalization Agreement is hereby amended by deleting
therefrom the reference to "Four Million Dollars ($4,000,000)" in clause (a) of
the second sentence thereof and substituting in lieu thereof the number "One
Million Dollars ($1,000,000)".
II. Other Matters.
2.1. Representation as to Authority. Each of Purchaser and the Company
hereby represents and warrants that it has all requisite corporate power and
authority to enter into this Amendment.
2.2. Agreement Regarding Sections 6.09, 6.15 and 6.17. In connection
with the amendments and agreements set forth in this Amendment, the Company
hereby agrees that the provisions of and the Company's and the Stockholders'
obligations under Sections 6.09, 6.15 and 6.17 of the Recapitalization Agreement
are hereby incorporated by reference in their entirety to this Amendment, except
that for purposes hereof Sections 6.09, 6.15 and 6.17 are hereby
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amended by deleting the dates "June 30, 2000" and "June 15, 2000" each time they
appear in such sections and substituting in lieu thereof the date "October 12,
2000".
2.3. Agreements Regarding Sections 5.05 and 6.14. Section 5.05 of the
Recapitalization Agreement is hereby amended by deleting the date "May 17, 2000"
and substituting in lieu thereof the date "October 2, 2000". The Company hereby
consents to the amendments to the Financial Commitments, dated as of October 2,
2000 and previously executed by Purchaser and each of Chase and CSFB, attached
hereto as Annex A and Annex B.
2.4. Agreements Regarding Sections 4.08 and 7.02 of the
Recapitalization Agreement.
(a) Reference is hereby made to a forecast of financial
results for the Company and the Company Subsidiaries for the period
from August through December 2000, attached hereto as Annex C (the
"Forecast"). Purchaser and the Company hereby acknowledge that the
Forecast states that the actual results of operations of the Company
and the Company Subsidiaries for the seven months ended July 31, 2000
resulted in earnings before interest, taxes, depreciation and
amortization ("EBITDA") for the Company and the Company Subsidiaries of
approximately $59,300,000.
(b) The Company hereby agrees that it shall deliver to
Purchaser (i) when available, and in any event not later than fifteen
business days prior to the date on which the Closing is scheduled, the
unaudited consolidated financial statements for the Company and the
Company Subsidiaries at September 30, 2000 and for the month then ended
and the nine months then ended and (ii) fifteen business days prior to
the date on which the Closing is scheduled (x) an updated forecast of
the financial results for the Company and the Company Subsidiaries for
the fiscal year ended December 31, 2000, which forecast shall be
prepared in good faith, using reasonable assumptions, on a basis and in
a format that is consistent with the Forecast (the "Closing Forecast"),
together with (y) a certificate from an officer of the Company and the
Company Subsidiaries stating the Closing Forecast has been prepared in
a manner consistent with clause (x) of this subsection (b)(ii).
(c) Purchaser and the Company and the Company Subsidiaries
hereby further agree that if the Closing Forecast:
(1) for the ten months ended October 31, 2000, projects a
reduction of the Company's (A) EBITDA in excess of
$2,200,000 from the projected EBITDA contained in the
Forecast for the ten month period ended October 31,
2000 or (B) diesel fuel volume for Company operated
sites of 14,289,000 gallons or more from the
projected diesel fuel volume of the Company operated
sites contained in the Forecast for the ten month
period ended October 31, 2000, or
(2) for the fiscal year ended December 31, 2000, projects
a reduction of the Company's (A) EBITDA in excess of
$3,100,000 from the projected EBITDA contained in the
Forecast or (B) diesel fuel volume for Company
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operated sites of 24,200,000 gallons or more from the
diesel fuel volume of the Company operated sites
contained in the Forecast,
then the conditions set forth in Sections 7.02(a) and 7.02(i)
shall be deemed to be not satisfied. Purchaser hereby agrees that if the Closing
Forecast does not project reductions in excess of the reductions permitted
pursuant to Sections 2.4(c)(1) and 2.4(c)(2), then Purchaser shall, at all
times, be prohibited from claiming:
(i) any breach of the representation contained in Section 4.08
of the Recapitalization Agreement that "since December 31,
1999... there have not been any events, changes, effects or
developments which have had or would reasonably be expected to
have, individually or in the aggregate, a Company Material
Adverse Effect" or
(ii) that the following conditions have not been satisfied:
(A) Section 7.02(a) of the Recapitalization Agreement (with
respect to the representation contained in Section 4.08 of the
Recapitalization Agreement and referred to in the immediately
preceding clause (i)) or (B) Section 7.02(i) of the
Recapitalization Agreement,
in each case referred to in clauses (i) and (ii) above,
subject to the following sentence, in respect of the "financial condition" and
"results of operations" of the Company and the Company Subsidiaries (as such
terms are used in the definition of "Company Material Adverse Effect"). The
parties to this Amendment agree, however, that the preceding sentence does not
constitute an agreement that Purchaser is prohibited from claiming (x) a breach
of the representation contained in Section 4.08 of the Recapitalization
Agreement referred to above or (y) a failure of the conditions set forth in
Sections 7.02(a) and 7.02(i) of the Recapitalization Agreement with respect to
events, changes, effects or developments affecting (i) the results of operations
of the Company and the Company Subsidiaries for the periods following the period
described in the Closing Forecast, (ii) the financial condition of the Company
and the Company Subsidiaries (in each case referred to in clauses (i) and (ii)
of this sentence, other than events, changes, effects or developments
(including, without limitation, trends in the "results of operations" of the
Company and the Company Subsidiaries) directly resulting from, or directly
relating to, results of operations of the Company and the Company Subsidiaries
for the period described in the Closing Forecast), or (iii) the business,
properties or assets of the Company and the Company Subsidiaries. The parties to
this Amendment further agree that nothing in the preceding sentence shall be
interpreted to create rights in or for the benefit of Purchaser beyond
Purchaser's rights under the Recapitalization Agreement prior to the execution
of this Amendment.
(d) Purchaser and the Company acknowledge and agree to work in
good faith to adjust reasonably the reduction thresholds contained in
Sections 2.4(c)(1) and 2.4(c)(2) above in the event, following the date
hereof, the Company or any Company Subsidiary sells any of the Company
owned locations, purchases any additional operating properties or
experiences the termination of any existing franchise, in each case as
permitted by Section 6.01 of the Recapitalization Agreement, to take
into account any such sales, purchases of operating properties or
terminations.
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2.5. Agreement Regarding Diesel Fuel Pricing. From the date hereof to
the Effective Time, unless otherwise consented to in writing by Purchaser, the
Company will, and will cause each Company Subsidiary to, use best efforts to
follow the pricing methodology with respect to diesel fuel sales as previously
agreed upon by the Company and Purchaser; provided that an unintentional failure
to follow such methodology shall not constitute a breach of the foregoing
agreement so long as such failure is promptly cured upon discovery thereof.
III. Miscellaneous.
3.1. Counterparts. This Amendment may be executed in any number of
counterparts, each of which shall be deemed an original, but all of which
together shall constitute a single instrument.
3.2. No Other Amendments; Confirmation. Except as expressly amended,
modified and supplemented hereby, the provisions of the Recapitalization
Agreement are and shall remain in full force and effect.
3.3. Governing Law; Exclusive Jurisdiction. This Amendment shall be
governed in all respects, by the laws of the State of Delaware, including
validity, interpretation and effect, without regard to principles of conflicts
of law. The parties hereto irrevocably and unconditionally consent to submit to
the exclusive jurisdiction of the courts of the State of Delaware for any
lawsuits, actions or other proceedings arising out of or related to this
Agreement and agree not to commence any lawsuit, action or other proceeding
except in such courts. The parties hereto further agree that service of process,
summons, notice or document by mail to their addresses set forth above shall be
effective service of process for any lawsuit, action or other proceeding brought
against them in any such court. The parties hereto irrevocably and
unconditionally waive any objection to the laying of venue of any lawsuit,
action or other proceeding arising out of or related to this Amendment in the
courts of the State of Delaware, and hereby further irrevocably and
unconditionally waive and agree not to plead or claim in any such court that any
such lawsuit, action or proceeding brought in any such court has been brought in
an inconvenient forum.
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IN WITNESS WHEREOF, this Amendment has been executed and delivered as
of the date first written above.
TRAVELCENTERS OF AMERICA, INC.
By: /s/ Xxxxx X. Xxxx
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Name Xxxxx X. Xxxx
Title: President & Chief Executive Officer
TCA ACQUISITION CORPORATION
By: /s/ Rowan X.X. Xxxxxx
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Name: Rowan X.X. Xxxxxx
Title: Principal
CLIPPER CAPITAL ASSOCIATES, L.P.
By: CLIPPER CAPITAL ASSOCIATES, INC.,
its General Partner
By: /s/ Xxxxxx X. Xxxxx
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Name: Xxxxxx X. Xxxxx
Title: Treasurer and Secretary
NATIONAL PARTNERS, L.P.
By: CLIPPER CAPITAL ASSOCIATES, L.P.,
its General Partner
By: CLIPPER CAPITAL ASSOCIATES, INC.,
its General Partner
By: /s/ Xxxxxx X. Xxxxx
------------------------
Name: Xxxxxx X. Xxxxx
Title: Treasurer and Secretary
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NATIONAL PARTNERS III, L.P.
By: CLIPPER CAPITAL ASSOCIATES, L.P.,
its General Partner
By: CLIPPER CAPITAL ASSOCIATES, INC.,
its General Partner
By: /s/ Xxxxxx X. Xxxxx
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Name: Xxxxxx X. Xxxxx
Title: Treasurer and Secretary
CLIPPER/MERCHANT I, L.P.
By: CLIPPER CAPITAL ASSOCIATES, L.P.,
its General Partner
By: CLIPPER CAPITAL ASSOCIATES, INC.,
its General Partner
By: /s/ Xxxxxx X. Xxxxx
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Name: Xxxxxx X. Xxxxx
Title: Treasurer and Secretary
OLYMPUS PRIVATE PLACEMENT FUND, L.P.
By: OGP PARTNERS, L.P., its General Partner
By: /s/ Xxxxxx X. Xxxxxx
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Name: Xxxxxx X. Xxxxxx
Title: General Partner
OLYMPUS GROWTH FUND II, L.P.
By: OGP II, L.P., its General Partner
By: LJM, L.L.C.
/s/ Xxxxx X. Xxxxxxxxxx
By: -----------------------------
Name: Xxxxx X. Xxxxxxxxxx
Title: Member
