Exhibit T
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November 6, 1998
Xx. Xxxx Xxxxxx
0000 Xxxxxxxx Xxxx, Xxxxx 0000
Xxxxxxx Xxxxx, XX 00000
Dear Xx. Xxxxxx:
As you know, you, Xxxx Xxxxxx ("Xxxxxx"), and I, Xxxxxx X. Xxxxx, Xx.,
Senior Vice President and Secretary of Trace International Holdings, Inc.
(formerly known as '21' International Holdings, Inc.) ("Trace"), have had
discussions and reached an understanding and agreement concerning the amendment
and modification of the letter agreements between Rallis and Trace dated July
21, 1998 (the "July 1998 Letter Agreement") and September 30, 1998 (the
September 1998 Letter Agreement"), which amended and modified certain provisions
of the Amended and Restated Put Option Agreement by and between Rallis and Trace
dated as of December 14, 1993 (the "Put Option Agreement"), to (a) extend the
Exercise Period under the Put Option Agreement (to March 31, 1999) and (b)
extend the last date for (i) the consummation of the Merger Transaction and (ii)
the Trace purchase from Rallis, and the Rallis sale to Trace, of all of the
Rallis right, title and interest in the Put Option Agreement under certain
circumstances (to March 24, 1999). This letter is intended to set forth the
understanding and agreement between Rallis and Trace respecting the foregoing,
viz:
Rallis and Trace agree:
1. The Exercise Period under the Put Option Agreement shall
be extended through March 31, 1999. That is paragraph 1 of the July
1998 Letter Agreement shall be amended to read in its entirety as
follows:
"1. Effective as of November 6, 1998, the Put Option
Agreement shall be amended and modified (and the Exercise Period shall
be extended) so that the Exercise Period (provided for in subsection
[b] of Section 1) shall be "at any time during the period commencing
on May 6, 1998 and ending March 31, 1999." That is, the Put Option may
be exercised, in whole or in part, by Rallis (and/or any permitted
assignee) at any time during the period commencing on May 6, 1998 and
ending March 31, 1999."
Xx. Xxxx Xxxxxx
November 6, 1998
Page 2
2. Paragraph 2 of the July 1998 Letter Agreement shall be
amended to read in its entirety as follows:
"2. Recently, (a) Trace advised Rallis of the execution and
delivery by Trace and Foamex International Inc. ("Foamex") of a new
definitive merger agreement whereby (i) Foamex shall be merged into a
wholly-owned subsidiary of Trace (the "Trace Merger Subsidiary"), (ii)
all shareholders of Foamex (other than Trace and its subsidiaries)
shall receive twelve dollars ($12) per share for their shares of
Foamex, and (iii) Foamex shall become a wholly-owned subsidiary of
Trace ("the Merger Transaction"), (b) Trace requested that Rallis (and
The Rallis Foundation) vote in favor of the Merger Transaction and
agree to accept twelve dollars ($12) per share for their shares of
Foamex in accordance with the terms of the Merger Transaction, and (c)
Trace requested that Rallis not exercise to Put Option."
3. The last date for (a) the consummation of the Merger
Transaction and (b) the Trace purchase from Rallis, and the Rallis
sale to Trace, of all of the right, title and interest of Rallis in
the Put Option Agreement under certain circumstances shall be extended
through March 24, 1999. That is, paragraph 3 of the July 1998 Letter
Agreement shall be amended to read in its entirety as follows:
"3. Therefore, in the event during the Exercise Period (a)
Rallis does not exercise the Put Option, (b) Rallis (and The Rallis
Foundation) tender the Rallis (and The Rallis Foundation) shares of
Foamex to the Trace Merger Subsidiary (in consideration for a payment
by the Trace Merger Subsidiary to Rallis [and The Rallis Foundation]
of twelve dollars [$12] per share for the Rallis [and The Rallis
Foundation] shares of Foamex), and (c) the Merger Transaction is
consummated on or before March 24, 1999, concurrently with the
consummation of the Merger Transaction, Rallis shall sell to Trace,
and Trace shall purchase from Rallis, all right, title and interest of
Rallis in the Put Option Agreement (and all rights of Rallis as to the
Put Option) for the payment by Trace to Rallis of the sum of three
million seven hundred ninety-five thousand three hundred eleven
dollars and seventy cents ($3,795,311.70). The Trace payment to Rallis
in this regard shall be made within two (2) business days of the
consummation of the Merger Transaction or on March 24, 1999, whichever
shall first occur."
Xx. Xxxx Xxxxxx
November 6, 1998
Page 3
4. Paragraph 4 of the July 1998 Letter Agreement shall be
amended to read in its entirety as follows:
"4. In the event (a) the payment by the Trace Merger
Subsidiary to Rallis (and The Rallis Foundation) is less than twelve
dollars ($12) per share for the Rallis (and The Rallis Foundation)
shares of Foamex (the "Shortfall"), the amount of the Shortfall shall
be added to the amount of the payment by Trace to Rallis for all
right, title and interest of Rallis in the Put Option provided for in
paragraph 3, above (viz, $3,795,311.70) and (b) the payment by the
Trace Merger Subsidiary to Rallis (and The Rallis Foundation) is more
than twelve dollars ($12) per share for the Rallis (and The Rallis
Foundation) shares of Foamex (the "Excess"), the amount of the Excess
shall be subtracted from the amount of the payment by Trace to Rallis
for all right, title and interest of Rallis in the Put Option provided
for in paragraph 3, above (viz, $3,795,311.70)."
5. In all other respects, the terms and provisions of the
July 1998 Letter Agreement and the September 1998 Letter Agreement
remain as is, unamended and unmodified.
If the foregoing correctly sets forth the understanding and agreement
between Rallis and Trace in this regard, kindly sign the enclosed copy of this
letter and return the enclosed copy of this letter to the undersigned, whereupon
this letter shall evidence and constitute our agreement.
Very truly yours,
Trace International Holdings, Inc.
By: /s/ Xxxxxx X. Xxxxx, Xx.
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Xxxxxx X. Xxxxx, Xx.
Senior Vice President and
Secretary
Agreed and Accepted:
November 6, 1998
/s/ Xxxx Xxxxxx
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Xxxx Xxxxxx
