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EXHIBIT 10.32
RECAPITALIZATION AGREEMENT
THIS AGREEMENT is made as of October __, 1996 between Lason, Inc., a
Delaware corporation (the "Company"), and each of the stockholders of the
Company executing a counterpart signature page hereto (collectively, the
"Stockholders"). Except as otherwise indicated herein, capitalized terms used
herein are defined in Section 6 hereof.
Each of the Stockholders owns that number of the Company's Class A-1
Common Stock, par value $.01 per share ("Class A-1 Common"), Class A-2 Common
Stock, par value $.01 per share ("Class A-2 Common" and together with the Class
A-1 Common, the "Class A Common"), and Class B Common Stock, par value $.01 per
share ("Class B Common"), set forth opposite such Stockholder's name on the
Schedule of Stockholders attached hereto. All such shares of Class A-1 Common,
Class A-2 Common and Class B Common are referred to herein as the "Exchange
Shares."
The Company has filed a Registration Statement on Form S-1 (File No.
333-09799) (the "Registration Statement") with the Securities and Exchange
Commission relating to an initial public offering (the "Initial Public
Offering") of the Company's common stock, par value $.01 per share (the "Common
Stock"), under the Securities Act. In connection with the Initial Public
Offering, the Stockholders desire to (i) cause the Company to amend and restate
its certificate of incorporation and (ii) exchange their Exchange Shares for
shares of Common Stock. Following such exchange, the Exchange Shares shall be
canceled.
The parties hereto agree as follows:
Section 1. Authorization and Exchange
1A. Restated Certificate of Incorporation. The Company's Board of
Directors has previously approved the Plan of Recapitalization attached hereto
as Exhibit A (the "Plan of Recapitalization") and has approved and authorized
of the Company's Amended and Restated Certificate of Incorporation in the form
attached hereto as Exhibit B (the "Restated Certificate"), to be filed and to
be effective as of the date of the consummation of the Initial Public Offering
(the "Closing Date"). The Stockholders have previously approved the Plan of
Recapitalization and the Restated Certificate pursuant to Section 242 of the
General Corporation Law of the State of Delaware.
1B. Authorization of the Common Stock. The Company hereby authorizes
the issuance of an aggregate of up to 5,000,000 shares of Common Stock to the
Stockholders in exchange for the Exchange Shares.
1C. Calculation of the Exchange Shares. The holders of Exchange
Shares shall receive (i) for each share of Class A-1 Common issued and
outstanding in their name, 1.00 share of Common Stock, (ii) for each share of
Class A-2 Common issued and outstanding in their name, 1.00 share of Common
Stock, and (iii) for each share of Class B Common issued and outstanding in
their name, a number of shares of Common Stock equal to (A) 1.00 plus (B) a
fraction, the numerator of
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which shall be the sum of the aggregate Unpaid Yield and the Unreturned
Preferred Amount (as such terms are defined in the Certificate of Incorporation
of the Company as currently in effect attached hereto as Exhibit C (the
"Current Certificate")) on the shares of Class B Common outstanding as of the
Closing Date and the denominator of which shall be the number of shares of
Class B Common outstanding on the Closing Date multiplied by 2.50 multiplied by
the initial price to public of the Initial Public Offering (the "IPO Price").
1D. Calculation of Shares. Prior to the Closing, the Company shall
calculate the number of shares of Common Stock to be issued to each Stockholder
as set forth above. The Company's calculations shall be conclusive and binding
upon each Stockholder absent manifest error.
1E. Exchange of the Exchange Shares. At the Closing, the Company
shall, upon the effectiveness of the Restated Certificate and subject to the
terms and conditions set forth herein, issue to each Stockholder a number of
shares of Common Stock calculated as set forth below, in exchange for the
Exchange Shares held by such Stockholder which shares shall be canceled
immediately thereafter. The Company will pay, based on the IPO Price, each
Stockholder for any fractional shares resulting from such calculation by check,
and such fractional shares will not be issued.
1F. The Closing. The closing of the transactions contemplated hereby
(the "Closing") shall take place at the offices of Winston & Xxxxxx, 00 Xxxx
Xxxxxx Xxxxx, Xxxxxxx, Xxxxxxxx at 9:00 a.m., Chicago time, on the Closing
Date, or at such other place as may be reasonably designated by the Company.
At the Closing, the Company shall deliver, or cause the Company's transfer
agent to deliver, to each Stockholder stock certificates evidencing the shares
of Common Stock to be issued by the Company to such Stockholder, registered in
such Stockholder's name or its nominee's name, upon presentment and delivery by
such Stockholder to the Company of the certificates representing the Exchange
Shares duly endorsed for transfer to the Company.
Section 2. Conditions of Each Stockholder's Obligation at the Closing.
The obligation of each Stockholder to exchange its Exchange Shares for the
Common Stock at the Closing is subject to the satisfaction as of the Closing of
the following conditions:
2A. Representations and Warranties. The representations and warranties
contained in Section 4 hereof shall be true and correct in all material
respects at and as of the Closing as though then made, except to the extent of
changes caused by the transactions expressly contemplated herein.
2B. Initial Public Offering. The Company shall consummate the Initial
Public Offering concurrently with the transactions contemplated hereby.
2C. Amendment of Certificate of Incorporation. The Restated
Certificate shall be in full force and effect as of the Closing under the laws
of Delaware and shall not have been further amended or modified.
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2D. Securities Law Compliance. The Company shall have made all filings
under all applicable federal and state securities laws necessary to consummate
the issuance of the Common Stock pursuant to this Agreement in compliance with
such laws.
2E. Closing Documents. The Company shall have delivered to each
Stockholder such documents relating to the transactions contemplated by this
Agreement as the holders of a majority of the Class A Common or the holders of
a majority of the Class B Common then outstanding may reasonably request.
2F. Proceedings. All corporate and other proceedings taken or
required to be taken by the Company in connection with the transactions
contemplated hereby to be consummated at or prior to the Closing and all
documents incident thereto shall be reasonably satisfactory in form and
substance to the holders of a majority of the Class A Common and the holders of
a majority of the Class B Common then outstanding.
2G. Waiver. Any condition specified in this Section 2 may be waived
if consented to by the holders of a majority of the Class A Common and the
holders of a majority of the Class B Common then outstanding; provided that no
such waiver shall be effective against any Stockholder unless it is set forth
in a writing executed by the required Stockholders.
Section 3. Transfer of Restricted Securities
3A. General Provisions. Restricted Securities are transferable only
pursuant to (i) public offerings registered under the Securities Act, (ii) Rule
144 or Rule 144A under the Securities Act (or any similar rule or rules then in
force) if such rule is available and (iii) subject to the conditions specified
in paragraph 3B below, any other legally available means of transfer.
3B. Opinion Delivery. In connection with the transfer of any
Restricted Securities (other than a transfer described in paragraph 3A(i) or
(ii) above), the holder thereof shall deliver written notice to the Company
describing in reasonable detail the transfer or proposed transfer, together
with an opinion of Seyburn, Kahn, Ginn, Bess, Xxxxxx & Xxxxxx, Xxxxxxxx & Xxxxx
or other counsel which (to the Company's reasonable satisfaction) is
knowledgeable in securities law matters to the effect that such transfer of
Restricted Securities may be effected without registration of such Restricted
Securities under the Securities Act. In addition, if the holder of the
Restricted Securities delivers to the Company an opinion of Seyburn, Kahn,
Ginn, Bess, Xxxxxx & Xxxxxx, Xxxxxxxx & Xxxxx or such other counsel that no
subsequent transfer of such Restricted Securities shall require registration
under the Securities Act, the Company shall promptly upon such contemplated
transfer deliver new certificates for such Restricted Securities which do not
bear the Securities Act legend set forth in paragraph 7C. If the Company is
not required to deliver new certificates for such Restricted Securities not
bearing such legend, the holder thereof shall not transfer the same until the
prospective transferee has confirmed to the Company in writing its agreement to
be bound by the conditions contained in this paragraph and paragraph 7C.
3C. Rule 144A. Upon the request of any Stockholder, the Company shall
promptly supply to such Stockholder or its prospective transferees all
information regarding the
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Company required to be delivered in connection with a transfer pursuant to
Rule 144A under the Securities Act.
3D. Legend Removal. If any Restricted Securities become eligible for
sale pursuant to Rule 144(k) under the Securities Act, the Company shall, upon
the request of the holder of such Restricted Securities, remove the legend set
forth in paragraph 7C from the certificates for such Restricted Securities.
Section 4. Representations and Warranties of the Company. As a
material inducement to the Stockholders to enter into this Agreement and to
exchange their Exchange Shares for Common Stock hereunder, the Company hereby
represents and warrants that:
4A. Organization and Corporate Power. The Company is a corporation
duly organized, validly existing and in good standing under the laws of
Delaware and is qualified to do business in every jurisdiction in which the
failure to so qualify has had or would reasonably be expected to have a
material adverse effect on the financial condition, operating results, assets,
operations or business prospects of the Company and its Subsidiaries taken as a
whole.
4B. Authorization: No Breach. The execution, delivery and performance
of this Agreement and all other agreements contemplated hereby and thereby to
which the Company is a party, the Plan of Recapitalization and the Restated
Certificate have been duly authorized by the Company. This Agreement, the Plan
of Recapitalization, the Restated Certificate and all other agreements
contemplated hereby and thereby to which the Company is a party each
constitutes a valid and binding obligation of the Company, enforceable in
accordance with its terms. The execution and delivery by the Company of this
Agreement and all other agreements contemplated hereby and thereby to which the
Company is a party, the issuance of the Common Stock hereunder, the Plan of
Recapitalization, the Restated Certificate and the fulfillment of and
compliance with the respective terms hereof and thereof by the Company, do not
and shall not (i) conflict with or result in a breach of the terms, conditions
or provisions of, (ii) constitute a default under, (iii) result in the creation
of any lien, security interest, charge or encumbrance upon the Company's or any
Subsidiary's capital stock or assets pursuant to, (iv) give any third party the
right to modify, terminate or accelerate any obligation under, (v) result in a
violation of, or (vi) require any authorization, consent, approval, exemption
or other action by or notice or declaration to, or filing with, any court or
administrative or governmental body or agency pursuant to, the Current
Certificate or the certificate of incorporation of any Subsidiary, or any law,
statute, rule or regulation to which the Company or any Subsidiary is subject,
or any agreement, instrument, order, judgment or decree to which the Company or
any Subsidiary is a party or by which their respective property is bound, other
than as expressly contemplated in such agreements described above and other
than those made and obtained.
4C. Capital Stock and Related Matters. As of the Closing and
immediately thereafter, the authorized capital stock of the Company shall
consist of 20,000,000 shares of Common Stock, of which approximately 8,162,462
(or 8,612,462 if the underwriters' over-allotment option is exercised in full,
in each case assuming an Initial Public Offering price of $15.50 per share and
redemption of the Common Stock contemplated by the Registration Statement)
shares will be
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issued and outstanding, and 5,000,000 shares of preferred stock,
par value $.01 per share (none of which shall be issued and outstanding). As
of the Closing, all of the outstanding shares of the Company's capital stock
shall be validly issued, fully paid and nonassessable. There are no statutory
or contractual stockholders preemptive rights or rights of refusal with respect
to the issuance of Common Stock hereunder which have not been waived or
terminated. The Company has not violated any applicable federal or state
securities laws in connection with the offer, sale or issuance of any of its
capital stock, and the offer, sale and issuance of the Common Stock hereunder
does not require registration under the Securities Act or any applicable state
securities laws.
Section 5. Representations and Warranties of the Stockholders. Each of
the Stockholders hereby represent and warrant to the Company that, with respect
to such Stockholder:
5A. Authorization; Enforceability. The execution, delivery and
performance of this Agreement and all other agreements contemplated hereby and
thereby to which any Stockholder is a party each constitutes a valid and
binding obligation of such Stockholder, enforceable in accordance with its
terms.
5B. No Violation. Neither the execution and the delivery of this
Agreement and the other documents contemplated hereby to which each Stockholder
is a party, nor the consummation of the transactions contemplated hereby and
thereby, will (a) conflict with, result in a breach of any of the provisions
of, (b) constitute a default under, (c) result in the violation of, (d) give
any third party the right to terminate or to accelerate any obligation under,
or (e) require any authorization, consent, approval, execution or other action
by or notice to or filing with any court or administrative or governmental body
under, the provisions of the certificate of incorporation or bylaws of the
Stockholder (where the Stockholder is an incorporated entity) or any statute,
regulation, rule, judgment, order, decree or other restriction of any
government, governmental agency or court to which the Stockholder is subject.
5C. Ownership. Except as otherwise described in the Registration
Statement, each Stockholder owns the Exchange Shares being exchanged by such
Stockholder pursuant to this Agreement free and clear of any restrictions on
transfer, claims, taxes, liens, charges, encumbrances, pledges, security
interests, options, warrants, rights, contracts, calls, commitments, equities
and demands, except for applicable restrictions on transfer under securities
laws.
Section 6. For the purposes of this Agreement, the following terms
have the meanings set forth below:
"Person" means an individual, a partnership, a corporation, a limited
liability company, an association, a joint stock company, a trust, a joint
venture, an unincorporated organization and a governmental entity or any
department, agency or political subdivision thereof.
"Restricted Securities" means (i) the Common Stock issued hereunder and
(ii) any securities issued with respect to the securities referred to in clause
(i) above by way of a stock dividend or stock split or in connection with a
combination of shares, recapitalization, merger, consolidation or other
reorganization. As to any particular Restricted Securities, such securities
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shall cease to be Restricted Securities when they have (a) been effectively
registered under the Securities Act and disposed of in accordance with the
registration statement covering them, (b) become eligible for sale pursuant to
Rule 144 (or any similar provision then in force) under the Securities Act or
(c) been otherwise transferred and new certificates for them not bearing the
Securities Act legend set forth in paragraph 7C have been delivered by the
Company in accordance with paragraph 3B. Whenever any particular securities
cease to be Restricted Securities, the holder thereof shall be entitled to
receive from the Company, without expense, new securities of like tenor not
bearing a Securities Act legend of the character set forth in paragraph 7C.
"Securities Act" means the Securities Act of 1933, as amended, or any
similar federal law then in force.
"Subsidiary" means, with respect to any Person, any corporation,
limited liability company, partnership, association or other business entity of
which (i) if a corporation, a majority of the total voting power of shares of
stock entitled (without regard to the occurrence of any contingency) to vote in
the election of directors, managers or trustees thereof is at the time owned or
controlled, directly or indirectly, by that Person or one or more of the other
Subsidiaries of that Person or a combination thereof, or (ii) if a limited
liability company, partnership, association or other business entity, a
majority of the partnership or other similar ownership interest thereof is at
the time owned or controlled, directly or indirectly, by any Person or one or
more Subsidiaries of that Person or a combination thereof. For purposes
hereof, a Person or Persons shall be deemed to have a majority ownership
interest in a limited liability company, partnership, association or other
business entity if such Person or Persons shall be allocated a majority of
limited liability company, partnership, association or other business entity
gains or losses or shall be or control any managing director or general partner
of such limited liability company, partnership, association or other business
entity.
Section 7. Miscellaneous
7A. Termination. This Agreement shall terminate upon the earlier of
(i) November 30, 1996, if the Initial Public Offeirng has not occurred by such
date, and (ii) the sending of notice by the Company to each Stockholder that
the Initial Public Offering will not be consummated.
7B. Remedies. Any Person having any rights under any provision of this
Agreement shall be entitled to enforce such rights specifically (without
posting a bond or other security), to recover damages by reason of any breach
of any provision of this Agreement and to exercise all other rights granted by
law.
7C. Legend. Each certificate or instrument representing Restricted
Securities shall be imprinted with a legend in substantially the following form:
"The securities represented by this certificate were originally issued
on_______ __, 1996 and have not been registered under the Securities Act
of 1933, as amended. The transfer of the securities represented by this
certificate is subject to the conditions specified in the
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Recapitalization Agreement, dated as of October __, 1996 and as amended
and modified from time to time, between the issuer (the "Company") and
certain investors, and the Company reserves the right to refuse the
transfer of such securities until such conditions have been fulfilled
with respect to such transfer. A copy of such conditions shall be
furnished by the Company to the holder hereof upon written request and
without charge."
7D. Consent to Amendments. Except as otherwise expressly provided
herein, the provisions of this Agreement may be amended and the Company may
take any action herein prohibited, or omit to perform any act herein required
to be performed by it, only if the Company has obtained the written consent of
the holders of at least two-thirds of the Common Stock held by the parties
subject to this Agreement (voting together as a single class).
7E. Survival of Representatives and Warranties. All representations
and warranties contained herein or made in writing by any party in connection
herewith shall survive the execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby, regardless of any
investigation made by any Stockholder or on its behalf.
7F. Successors and Assigns. Except as otherwise expressly provided
herein, all covenants and agreements contained in this Agreement by or on
behalf of any of the parties hereto shall bind and inure to the benefit of the
respective successors and assigns of the parties hereto whether so expressed or
not. In addition, and whether or not any express assignment has been made, the
provisions of this Agreement which are for any Stockholder's benefit as a
Stockholder or holder of Common Stock are also for the benefit of, and
enforceable by, any subsequent holder of such Common Stock.
7G. Severability. Whenever possible, each provision of this Agreement
shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Agreement is held to be prohibited
by or invalid under applicable law, such provision shall be ineffective only to
the extent of such prohibition or invalidity, without invalidating the
remainder of this Agreement.
7H. Counterparts. This Agreement may be executed simultaneously in
two or more counterparts, any one of which need not contain the signatures of
more than one party, but all such counterparts taken together shall constitute
one and the same Agreement.
7I. Descriptive Headings; Interpretation. The descriptive headings of
this Agreement are inserted for convenience only and do not constitute a
substantive part of this Agreement. The use of the word "including" in this
Agreement shall be by way of example rather than by limitation.
7J. GOVERNING LAW. THE CORPORATE LAW OF DELAWARE SHALL GOVERN ALL
ISSUES CONCERNING THE RELATIVE RIGHTS OF THE COMPANY AND ITS STOCKHOLDERS. ALL
OTHER QUESTIONS CONCERNING THE CONSTRUCTION, VALIDITY AND INTERPRETATION OF
THIS AGREEMENT AND THE EXHIBITS AND SCHEDULES HERETO SHALL BE GOVERNED BY THE
INTERNAL LAW, AND NOT THE LAW OF CONFLICTS, OF MICHIGAN.
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7K. Notices. All notices, demands or other communications to be given
or delivered under or by reason of the provisions of this Agreement shall be in
writing and shall be deemed to have been given when delivered personally to the
recipient, sent to the recipient by reputable overnight courier service
(charges prepaid) or telecopied to the recipient. Such notices, demands and
other communications shall be sent to each Stockholder at the address indicated
next to such party's name on the signature pages hereto or to such other
address or to the attention of such other person as the recipient party has
specified by prior written notice to the sending party.
* * * * *
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IN WITNESS WHEREOF, the parties hereto have executed this
Recapitalization Agreement on the date first written above.
Address: LASON, INC.
By:___________________________________
Its:
Address: GOLDER, THOMA, XXXXXXX, XXXXXX
FUND IV, L.P.
By: GTCR IV, L.P.
Its: General Partner
By: Golder, Thoma, Cressey, Rauner, Inc.
Its: General Partner
By:___________________________________
Its:
Address: XXXXXX X. XXXXXXX LIVING TRUST
U/A/D MAY 11, 1982
By:___________________________________
Its:
Address: XXXXXX XXXXXXXX XXXXXXX AND
XXXXXXXX X. XXXXXXX IRREVOCABLE
TRUST DATED JANUARY 5, 1993
By:___________________________________
Its:
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Address: XXXXXX XXXXXXXX XXXXXXX AND
XXXXXXXX X. XXXXXXX IRREVOCABLE
TRUST NO. 2 DATED AUGUST 6, 1996
By:___________________________________
Its:
Address: XXXXX X. XXXXXXX LIVING TRUST,
DATED DECEMBER 7, 1994
By:___________________________________
Its:
Address: XXXXX X. XXXXXXX AND XXXXXXXX
XXXXXXX XXXXXXX TRUST EFFECTIVE
AS OF JANUARY 1, 1996
By:___________________________________
Its:
______________________________________
Address: Xxxxxx X. Xxxxxx
______________________________________
Address: Xxxxxxx X. Xxxxxxxx
______________________________________
Address: Xxxxxx X. Xxxxxxx
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______________________________________
Address: Xxxxxxx Xxxxx
______________________________________
Address: Xxxxx X. Xxxxx
______________________________________
Address: Xxxx X. Xxxxx
______________________________________
Address: Xxxx X. Xxxxxx
______________________________________
Address: Xxxxx X. Xxxxxxxxxxx
______________________________________
Address: Xxxxxxxx X. Xxxxx
______________________________________
Address: Xxxxx X. Xxxxxx
______________________________________
Address: Xxxx X. Xxxxxxxx
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Address: ______________________________________
Xxxxxxx X. Xxxxxxx
Address: XXXXXXX XXXXXXX CHARITABLE REMAINDER UNITRUST
By:___________________________________
Its:
Address: ______________________________________
Xxxxxx X. Xxxxxxx
Address: XXXXXX X. XXXXXXX CHARITABLE REMAINDER UNITRUST
By:___________________________________
Its:
Address: ______________________________________
Xxxx Xxxxxxx
Address: XXXX XXXXXXX CHARITABLE REMAINDER UNITRUST
By:___________________________________
Its:
Address: ______________________________________
Xxxxx X. Xxxxxxx, Xx.
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Address: ______________________________________
Xxxxxx Xxxxxxx
Address: XXXXXX X. AND XXXXXX X. XXXXXXX
CHARITABLE REMAINDER UNITRUST
By:___________________________________
Its
Address: ______________________________________
Xxxxx Xxxxxxxx
Address: ______________________________________
Xxxxxxx Xxxxxx
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Schedule of Stockholders*
Class A-1 Common Class A-2 Class B Common
Common
Golder, Thoma, Xxxxxxx, Xxxxxx Fund IV, L.P. - - 1,000,001
Xxxxxx X. Xxxxxxx Living Trust U/A/D May 11, 1982 166,074 - -
Xxxxxx Xxxxxxxx Xxxxxxx and Xxxxxxxx X. Xxxxxxx
Irrevocable Trust Dated January 5, 1993 84,000 - -
Xxxxxxxx Xxxxxxx and Xxxxxxxx X. Xxxxxxx Irrevocable
Trust No. 2 Dated August 6, 1996 190,577 - -
Xxxxx X. Xxxxxxx Living Trust, Dated December 7, 1994 352,524 - -
Xxxxx X. Xxxxxxx and Xxxxxxxx Xxxxxxx Xxxxxxx Trust
Effective as of January 1, 1996 44,065 - -
Xxxxx X. Xxxxxxx and Xxxxxxxx Xxxxxxx Xxxxxxx Trust
Effective as of January 1, 1996 44,065 - -
Xxxxxx X. Xxxxxx 28,815 - -
Xxxxxxx X. Xxxxxxxx 25,000 - -
Xxxxxx X. Xxxxxxx 8,523 - -
Xxxxxxx Xxxxx 10,899 - -
Xxxxx X. Xxxxx 8,523 1,705 -
Xxxx X. Xxxxx 5,682 - -
Xxxx X. Xxxxxx 8,523 1,705 -
Xxxxx X. Xxxxxxxxxxx 8,523 1,705 -
Xxxxxxxx X. Xxxxx 8,523 - -
Xxxxx X. Xxxxxx 2,841 - -
Xxxx X. Xxxxxxxx 2,841 - -
Xxxxxxx X. Xxxxxxx 1,193 - -
Xxxxxxx Xxxxxxx Charitable Remainder Unitrust 4,770 - -
Xxxxxx X. Xxxxxxx 2,384 - -
Xxxxxx X. Xxxxxxx Charitable Remainder Unitrust 3,577 - -
Xxxx Xxxxxxx 2,384 - -
Xxxx Xxxxxxx Charitable Remainder Unitrust 3,577 - -
Xxxxx X. Xxxxxxx, Xx. 8,130 - -
Xxxxxx Xxxxxxx 2,601 - -
Xxxxxx X. And Xxxxxx X. Xxxxxxx
Charitable Remainder Unitrust 3,902 - -
Xxxxx Xxxxxxxx 13,677 - -
Xxxxxxx Xxxxxx 13,677 - -
*Assumes an IPO Price of $15.50 per share.
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PLAN OF RECAPITALIZATION
PLAN OF RECAPITALIZATION of Lason, Inc., a Delaware corporation (the
"Corporation").
W I T H E S S E T H :
WHEREAS, the Corporation currently has authorized 19,000,002 shares of
stock consisting of: (i) 13,000,000 shares of Class A-1 Common Stock, par value
$.01 per share (the "Class A-1 Common"), (ii) 4,000,000 shares of Class A-2
Common Stock, par value $.01 per share (the "Class A-2 Common"), (iii) 1,000,002
shares of Class B Common Stock, par value $.01 per share (the "Class B Common"),
and (iv) 1,000,000 shares of Preferred Stock, par value $.01 per share (the
"Preferred Stock"), each with the terms set forth in the Corporation's
Certificate of Incorporation, as amended (the "Current Certificate"), attached
hereto as Exhibit A.
WHEREAS, the Corporation has filed a Registration Statement on Form
S-1 (File No. 333-09799) with the Securities and Exchange Commission relating to
an initial public offering (the "Initial Public Offering") of the Corporation's
Common Stock (as defined below) under the Securities Act of 1933, as amended.
WHEREAS, the Board of Directors of the Corporation (the "Board"), in
connection with the Initial Public Offering, has determined it desirable and in
the best interests of the Corporation to reclassify and exchange all shares of
Class A-1 Common, Class A-2 Common and Class B Common for shares of the
Corporation's common stock, par value $.01 per share (the "Common Stock"), with
the terms set forth in the Amended and Restated Certificate of Incorporation of
the Corporation attached hereto as Exhibit B (the "Restated Certificate") to be
filed concurrently with the closing of the Initial Public Offering.
WHEREAS, the Corporation and certain of its stockholders will execute
a Recapitalization Agreement (the "Recapitalization Agreement") in substantially
the form attached hereto as Exhibit C.
NOW, THEREFORE:
Effective concurrently with the closing of the Initial Public Offering
(the "Effective Time") and, with respect to the Stockholders (as defined in the
Recapitalization Agreement), subject to the terms and provisions of the
Recapitalization Agreement, (i) each share of Class A-1 Common issued and
outstanding shall be exchanged for 1.00 share of Common Stock, (ii) each share
of Class A-2 Common issued and outstanding shall be exchanged for 1.00 share of
Common Stock, and (iii) each share of Class B Common issued and outstanding
shall be exchanged for a number of shares of Common Stock equal to (A) 1.00 plus
(B) a fraction, the numerator of which shall be the sum of the aggregate Unpaid
Yield and the Unreturned Preferred Amount (as such terms are defined in the
Current Certificate) on the shares of Class B Common outstanding as of the
Effective Time and the denominator of which shall be the number of shares of
Class B Common outstanding as of the
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Effective Time multiplied by 2.50 by the initial price to public of the Initial
Public Offering.
This Plan of Recapitalization may be abandoned by the Board at any
time prior to the Effective Time, irrespective of the fact of its approval by
the requisite stockholders of the Corporation, if in its sound business
judgment, this Plan of Recapitalization is unsatisfactory in substance to the
Board.
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