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EXHIBIT 2.7
EXCHANGE AGREEMENT
This Exchange Agreement (the "Agreement") is made and entered into
effective as of June 16, 1999, by and among ▇▇▇▇▇▇ ▇▇▇▇▇▇, Inc., a Delaware
corporation (the "Company"), and all of its stockholders as listed on the
signature pages hereto (collectively the "Stockholders" and individually a
"Stockholder").
1. Introduction. On May 10, 1999, the Company filed a registration
statement on Form S-1 (the "Registration Statement") with the Securities and
Exchange Commission for the public offering of its common stock, par value $0.01
per share. In connection with that public offering (the "Offering"), the Company
and the Stockholders desire to effect a recapitalization of the Company. There
are currently outstanding 8,047 shares of the Company's Class A Common Stock and
2,541 shares of the Company's Class B Common Stock. The Board of Directors of
the Company and the Stockholders have approved the amendment and restatement of
the Company's Restated Certificate of Incorporation (the "Restated
Certificate"), which amendment and restatement will provide for common stock,
par value $0.01 per share (the "Common Stock") and non-voting convertible common
stock, par value $0.01 per share (the "Non-Voting Common Stock").
2. Exchange. Effective as of the Closing Date, as defined below, the
Company shall exchange with the Stockholders the number of shares of existing
Class A Common Stock and Class B Common Stock held by each Stockholder as set
forth on Exhibit A attached hereto ("Exhibit A") for the number of shares of
Common Stock and Non-Voting Common Stock as set forth on Exhibit A. Subject to
the requirement that no fractional shares be issued, all exchanges will be made
at a rate of one existing share for 3093.124292 new shares. No fractional shares
of Common Stock or Non-Voting Common Stock will be issued upon the exchange;
rather, the number of shares of Common Stock or Non-Voting Common Stock to be
issued based on the exchange ratio set forth above will be rounded up or down to
the nearest whole share.
3. Closing. The closing of the exchange (the "Closing") will, subject to
Section 9 hereof, take place immediately upon the Registration Statement, or any
amendment thereto, being declared effective by the Securities and Exchange
Commission, with such date to be the "Closing Date."
4. Deliveries.
(a) By Stockholders. On the date hereof, the Stockholders shall
deliver to the Company all certificates representing the Class A Common Stock
and Class B Common
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Stock listed on Exhibit A either executed in blank or together with stock powers
executed in blank.
(b) By the Company. Promptly after the Closing, the Company shall
deliver to each Stockholder certificates representing the shares of Common Stock
and Non-Voting Common Stock listed on Exhibit A to be issued in favor of such
Stockholder.
5. Representations and Warranties of the Company. The Company hereby
represents and warrants to the Stockholders as follows as of the date hereof and
as of the Closing Date:
(a) The Company has full power and authority to execute, deliver and
perform this Agreement and to perform its obligations hereunder and to
consummate the transactions contemplated herein.
(b) The execution and delivery by the Company of this Agreement and the
performance of its obligations contemplated hereby have been duly and validly
authorized by all necessary action of the Company.
(c) This Agreement has been duly executed and delivered by a duly
authorized officer of the Company and constitutes the legal, valid and binding
obligations of the Company, enforceable against the Company in accordance with
its terms and conditions except as such enforcement may be limited by
bankruptcy, insolvency, reorganization, moratorium or other similar laws
affecting the enforcement of creditors' rights generally and by general
principles of equity (whether applied in a proceeding at law or in equity).
(d) The shares of Common Stock and Non-Voting Common Stock, upon
issuance in accordance with the terms hereof, shall be duly authorized, fully
paid and nonassessable.
6. Representations and Warranties of the Stockholders. Each Stockholder
hereby represents and warrants, severally and not jointly, as follows as of the
date hereof and as of the Closing Date:
(a) The Stockholder has full legal capacity to execute, deliver and
perform this Agreement and to perform his, her or its obligations hereunder and
to consummate the transactions contemplated herein.
(b) This Agreement has been duly executed and delivered by the
Stockholder (or if the Stockholder is an entity, by a duly authorized officer of
the Stockholder) and
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constitutes the legal, valid and binding obligations of the Stockholder,
enforceable against the Stockholder in accordance with its respective terms and
conditions except as such enforce ment may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting the enforcement of
creditors' rights generally and by general principles of equity (whether applied
in a proceeding at law or in equity).
(c) All shares of Class A Common Stock or Class B Common Stock of the
Company that the Stockholder is to deliver to the Company pursuant to Section 4
above are free and clear of all liens, assessments, charges, claims, pledges,
security interests and other encumbrances.
(d) The Stockholder acknowledges that the Common Stock and Non-Voting
Common Stock constitute securities under the Securities Act of 1933, as amended
("Securities Act"), and applicable state securities laws (collectively, "Acts").
The Stockholder acknowledges that the Common Stock and Non-Voting Common Stock
have not been registered under the Acts in reliance on available exemptions from
the registration requirements thereof.
(e) The Stockholder has such knowledge and experience in financial and
business matters that the Stockholder is capable of evaluating the merits and
risks of his, her or its acquisition of the Common Stock and Non-Voting Common
Stock The Stockholder has had access to and an opportunity to inspect all
relevant information relating to the Company sufficient to enable the
Stockholder to evaluate the merits and risks of his, her or its acquisition of
the Common Stock and Non-Voting Common Stock . The Stockholder also has had the
opportunity to ask questions and receive answers respecting, and to obtain such
additional information as the Stockholder has desired regarding, the business,
financial condition and affairs of the Company. The Stockholder has received a
copy of the Registration Statement.
(f) The Stockholder's acquisition of the Common Stock and Non-Voting
Common Stock is for the Stockholder's own account, is for investment purposes,
and is without a view to, or for offer or sale for the Company in connection
with, any distribution of the Common Stock and Non-Voting Common Stock. The
Stockholder is not participating and does not have a participation in any such
distribution or the underwriting of any such distribution.
(g) The Stockholder understands that Common Stock and Non-Voting Common
Stock must be held for an indefinite period of time unless such stock
subsequently is registered under the Acts or exemptions from the registration
requirements thereof are available. The Stockholder understands that upon
issuance of the shares Common Stock and
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Non-Voting Common Stock in accordance with this Agreement, a new holding period
for purposes of Rule 144 promulgated under the Securities Act may begin with
respect to such shares.
(h) Each Stockholder acknowledges that ▇▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇, L.L.P.,
counsel to the Company, has not represented nor does represent such
Stockholder's interests in the negotiation, execution or performance of this
Agreement and that such Stockholder has been advised to seek its own counsel for
such purposes. Each Stockholder represents and affirms that such Stockholder is
not relying on any oral statement made by the Company or any agent or
representative of the Company in making its decision to enter into this
Agreement or to consummate the transactions contemplated hereby.
(i) The Stockholder acknowledges that upon issuance, the certificates
representing the Common Stock and Non-Voting Common Stock shall have the
following legend:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE SECURITIES
LAWS ("ACTS"). THE SECURITIES HAVE BEEN ACQUIRED FOR INVESTMENT AND MAY
NOT BE SOLD OR OFFERED FOR SALE IN THE ABSENCE OF AN EFFECTIVE
REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE ACTS OR AN OPINION
OF COUNSEL SATISFACTORY TO THE CORPORATION THAT SUCH REGISTRATION IS
NOT REQUIRED.
7. Survival of Representations and Warranties. The representations and
warranties made by the Company and the Stockholders herein shall survive beyond
the date hereof for the maximum period permitted by applicable law.
8. Terminations. The Company and the First Union Corporation hereby agree
to the termination effective as of the Closing Date of the Common Stock
Subscription Agreement dated February 14, 1997, between the Company and First
Union Corporation. The Company and the Stockholders hereby acknowledge that the
Shareholders Agreement dated as of February 14, 1997, among the Company and
certain of the Stockholders, as supplemented, shall terminate according to its
terms upon the consummation of the Offering. In addition, the Company and the
Stockholders agree to the termination effective as of the termination of that
Shareholders Agreement of all Shareholder Agreement Supplements dated September
3, 1998, executed by the Company and certain Stockholders.
9. Conditions to Closing. The Company shall be authorized to effect the
Closing, cancel the certificates representing the Class A Common Stock and the
Class B Common Stock and issue the certificates representing the Common Stock
and Non-Voting Common
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Stock on the Closing Date upon the satisfaction on or prior to the Closing Date
of all of the following conditions:
(a) The Company and the Stockholders shall have executed an Amended and
Restated Registration Rights Agreement that amends and restates in its entirety
the Registration Rights Agreement dated as of February 14, 1997, among the
Company, ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇▇▇▇▇ Associates, Inc. and First Union Corporation,
as amended.
(b) The SEC shall have declared the Registration Statement effective.
(c) The Company shall have filed the Restated Certificate of
Incorporation, in the form previously approved by the Stockholders, with the
Secretary of State of Delaware and such filing shall have been accepted.
(d) No suit, action or other proceeding shall be pending in which there
is sought any remedy to restrain, enjoin or otherwise prevent the consummation
of this Agreement or the transactions in connection herewith.
10. Notices. Any notice, request, instruction, correspondence or other
document to be given hereunder by either party to the other (herein collectively
called "Notice") shall be in writing and delivered in person or by courier
service requiring acknowledgment of receipt of delivery or mailed by certified
mail, postage prepaid and return receipt requested, or by telecopier, to the
addresses for notice as set forth in the Shareholders Agreement of the Company.
Notice given by personal delivery, courier service or mail shall be effective
upon actual receipt. Notice given by telecopier shall be confirmed by
appropriate answer back and shall be effective upon actual receipt if received
during the recipient's normal business hours, or at the beginning of the
recipient's next business day after receipt if not received during the
recipient's normal business hours. All Notices by telecopier shall be confirmed
promptly after transmission in writing by certified mail or personal delivery.
Any party may change any address to which Notice is to be given to it by giving
Notice as provided above of such change of address.
11. Governing Law. The provisions of this Agreement shall be governed by
and construed and enforced in accordance with the laws of the State of Delaware
(excluding any conflicts-of-law rule or principle that might refer same to the
laws of another jurisdiction), except to the extent that same are mandatorily
subject to the laws of another jurisdiction pursuant to the laws of such other
jurisdiction.
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12. Entire Agreement; Amendments and Waivers. This Agreement constitutes
the entire agreement between the parties hereto pertaining to the subject matter
hereof and supersedes all prior agreements, understandings, negotiations and
discussions, whether oral or written, of the parties, and there are no
warranties, representations or other agreements between the parties in
connection with the subject matter hereof except as set forth specifically
herein or contemplated hereby. No supplement, modification or waiver of this
Agreement shall be binding unless executed in writing by the party to be bound
thereby. The failure of a party to exercise any right or remedy shall not be
deemed or constitute a waiver of such right or remedy in the future. No waiver
of any of the provisions of this Agreement shall be deemed or shall constitute a
waiver of any other provision hereof (regardless of whether similar), nor shall
any such waiver constitute a continuing waiver unless otherwise expressly
provided. Each party to this Agreement agrees that (a) no other party to this
Agreement (including its agents and representatives) has made any
representation, warranty, covenant or agreement to or with such party relating
to the transactions contemplated hereby, other than those expressly set forth
herein, and (b) such party has not relied upon any representation, warranty,
covenant or agreement relating to the transactions contemplated hereby, other
than those referred to in clause (a) above.
13. Binding Effect and Assignment. This Agreement is binding upon and
inures to the benefit of the parties hereto and their respective permitted
successors and assigns; but neither this Agreement nor any of the rights,
benefits or obligations hereunder shall be assigned, by operation of law or
otherwise, by any party hereto without the prior written consent of the Company,
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇▇▇▇▇ Associates, Inc. and First Union Corporation. Nothing
in this Agreement, express or implied, is intended to confer upon any person or
entity other than the parties hereto and their respective permitted successors
and assigns, any rights, benefits or obligations hereunder.
14. Severability. If any provision of the Agreement is rendered or
declared illegal or unenforceable by reason of any existing or subsequently
enacted legislation or by decree of a court of last resort, the Company, ▇▇▇▇▇▇▇
▇. ▇▇▇▇▇▇, ▇▇▇▇▇▇ Associates, Inc. and First Union Corporation shall promptly
meet and negotiate substitute provisions for those rendered or declared illegal
or unenforceable, but all of the remaining provisions of this Agreement shall
remain in full force and effect.
15. Headings. The headings of the sections herein are inserted for
convenience of reference only and are not intended to be a part of or to affect
the meaning or interpretation of this Agreement.
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16. Execution. This Agreement may be executed in multiple counterparts
each of which shall be deemed an original and all of which shall constitute one
instrument.
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This Agreement is executed and delivered by the Company and the
Stockholders on the date first set forth above.
COMPANY:
▇▇▇▇▇▇ ▇▇▇▇▇▇, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
President
STOCKHOLDERS:
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
▇▇▇▇▇▇ ASSOCIATES, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
President
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FIRST UNION CORPORATION
By: /s/ ▇▇▇ ▇▇▇▇▇▇▇
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▇▇▇ ▇▇▇▇▇▇▇
Senior Vice President
/s/ ▇. ▇▇▇▇▇▇ HAUPTFUHRER
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/s/ ▇. ▇▇▇▇▇ ▇▇▇▇▇▇▇ III
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▇. ▇▇▇▇▇ ▇▇▇▇▇▇▇ III
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Exhibit A
Shares of Shares of Shares of
Class A Class B Shares of Non-Voting
Common Stock Common Stock Common Stock Common Stock
Stockholder Held Held to be issued to be issued
------------------------------ ------------ ------------ ------------ ------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ 5,801 444.8 19,319,036
▇▇▇▇▇▇ Associates, Inc. 2,246 111.2 7,291,113
First Union Corporation 1,588 1,435,209 3,476,671
▇. ▇▇▇▇▇▇ Hauptfuhrer 41 126,818
▇▇▇ ▇. ▇▇▇▇▇▇▇ 59 182,494
▇▇▇▇▇ ▇. ▇▇▇▇▇▇ 42 129,911
▇▇▇▇▇ ▇. and ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ 41 126,818
▇▇▇▇▇ ▇. ▇▇▇▇ 38 117,539
▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ ▇▇ 38 117,539
▇. ▇▇▇▇▇ ▇▇▇▇▇▇▇ III 38 117,539
▇▇▇▇▇ ▇. and ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ 32 98,980
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ 38 117,539
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ 30 92,794
----- ----- ---------- ---------
Total 8,047 2,541 29,273,329 3,476,671
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