EXECUTION COPY
This VOTING AGREEMENT, dated as of March 15, 2010 (this "AGREEMENT"), by
and among Sage Parent Company, Inc., a Delaware corporation ("PARENT") and the
Persons listed on SCHEDULE A hereto (each, a "SUBJECT SHAREHOLDER", and
collectively, the "SUBJECT SHAREHOLDERS"). With respect to each individual
Subject Shareholder, this Agreement shall be treated as a separate agreement as
between such Subject Shareholder and Parent.
WHEREAS, Parent, Sage Merger Company, Inc., a Delaware corporation and a
wholly-owned subsidiary of Parent ("SUB"), and Sport Supply Group, Inc., a
Delaware corporation (the "COMPANY"), propose to enter into a Merger Agreement,
dated as of the date hereof (as the same may be amended, supplemented or
modified from time to time, the "MERGER AGREEMENT"), pursuant to which Sub shall
merge with and into the Company, with the Company being the surviving
corporation, and pursuant to which each of the holders of Company Common Stock
shall receive the Merger Consideration with respect to the shares of Company
Common Stock held thereby; capitalized terms used but not defined herein shall
have the meanings ascribed to such terms in the Merger Agreement;
WHEREAS, each Subject Shareholder Beneficially Owns the number of shares of
Company Common Stock set forth opposite its name on SCHEDULE A hereto (such
shares of Company Common Stock, together with any other shares of Company Common
Stock or other shares of Company Capital Stock acquired by such Subject
Shareholder by stock dividend or stock split after the date hereof and during
the term of this Agreement, being collectively referred to herein as such
Subject Shareholder's "SUBJECT SHARES"); and
WHEREAS, as a condition to Parent and Sub's willingness to enter into the
Merger Agreement, Parent has requested that the Subject Shareholders enter into
this Agreement;
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereto agree as
follows:
Section 1. REPRESENTATIONS AND WARRANTIES OF EACH SUBJECT SHAREHOLDER.
Each Subject Shareholder hereby represents and warrants to Parent as follows:
(a) AUTHORITY; EXECUTION AND DELIVERY; ENFORCEABILITY. Such Subject
Shareholder has all requisite power and authority to execute this Agreement and
to consummate the transactions contemplated hereby. The execution and delivery
by such Subject Shareholder of this Agreement and consummation of the
transactions contemplated hereby have been duly authorized by all necessary
action on the part of such Subject Shareholder. Such Subject Shareholder has
duly executed and delivered this Agreement and, assuming its due authorization,
execution and delivery by Parent, this Agreement constitutes the legal, valid
and binding obligation of such Subject Shareholder, enforceable against such
Subject Shareholder in accordance with its terms. The execution and delivery by
such Subject Shareholder of this Agreement does not, and the consummation of the
transactions contemplated hereby and compliance with the terms hereof will not,
conflict with, or result in any violation of, or default (with or without notice
or lapse of time, or both) under, or give rise to a right of termination,
cancellation or acceleration of any obligation or to loss of a material benefit
under, or result in the creation of any Lien upon the Subject Shares under, any
provision of any Contract to which such Subject Shareholder is a party or by
which the Subject Shares are bound or, subject to the filings and other matters
referred to in the next sentence, any provision of any Order or Law applicable
to such Subject Shareholder or the Subject Shares. No Consent of, or
registration,
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declaration or filing with, any Governmental Entity is required to be obtained
or made by or with respect to such Subject Shareholder in connection with the
execution, delivery and performance of this Agreement or the consummation of the
transactions contemplated hereby, other than such reports and schedules under
Sections 13(d), 13(e) and 16 of the Exchange Act as may be required in
connection with this Agreement and the transactions contemplated hereby.
(b) THE SUBJECT SHARES. Such Subject Shareholder is the record or
Beneficial Owner of and has good and marketable title to, the Subject Shares,
free and clear of any Liens. Such Subject Shareholder does not Beneficially Own,
or own of record, any equity securities of the Company or any of its
Subsidiaries other than the Subject Shares and no Affiliate of such Subject
Shareholder Beneficially Owns, or owns of record, any equity securities of the
Company. Such Subject Shareholder has the sole right to vote the Subject Shares,
and none of the Subject Shares is subject to any voting trust or other Contract,
arrangement or restriction with respect to the voting of the Subject Shares,
except as contemplated by this Agreement or the Merger Agreement. Such Subject
Shareholder has not appointed or granted any proxy or similar agreement
inconsistent with this Agreement, which appointment or grant is still effective,
with respect to the Subject Shares.
As used in this Agreement, "Beneficial Owner" means, with respect to any
security, any Person who, directly or indirectly, through any Contract,
understanding, relationship or otherwise, has or shares (i) voting power, which
includes the power to vote, or to direct the voting of, such security; and/or
(ii) investment power, which includes the power to dispose, or to direct the
disposition, of such security; and shall otherwise be interpreted in accordance
with the term "beneficial ownership" as defined in Rule 13d-3 adopted by the SEC
under the Exchange Act. For purposes of this Agreement, a Person shall be deemed
to be the Beneficial Owner of any securities Beneficially Owned by its
Affiliates (including as Affiliates for this purpose its officers and directors)
or any Group of which such Person or any such Affiliate is or becomes a member.
The terms "Beneficially Own", "Beneficially Owned" and "Beneficial Ownership"
shall have correlative meanings to "Beneficial Owner".
(c) BROKERS. No broker, investment banker, financial advisor or other
Person is entitled to any broker's, finder's, financial advisor's or other
similar fee or commission in connection with the Transactions based upon
arrangements made by or on behalf of such Subject Shareholder.
(d) MERGER AGREEMENT. Such Subject Shareholder understands and
acknowledges that Parent is entering into the Merger Agreement in reliance upon
such Subject Shareholder's execution and delivery of this Agreement.
Section 2. REPRESENTATIONS AND WARRANTIES OF PARENT. Parent hereby
represents and warrants to the Subject Shareholders as follows: Parent has all
requisite corporate power and authority to execute this Agreement and to
consummate the transactions contemplated hereby. The execution and delivery by
Parent of this Agreement and consummation of the transactions contemplated
hereby have been duly authorized by all necessary action on the part of Parent.
Parent has duly executed and delivered this Agreement and, assuming its due
authorization, execution and delivery by each Subject Shareholder, this
Agreement constitutes the legal, valid and binding obligation of Parent,
enforceable against Parent in accordance with its terms. The
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execution and delivery by Parent of this Agreement does not, and the
consummation of the transactions contemplated hereby and compliance with the
terms hereof will not, conflict with, or result in any violation of, or default
(with or without notice or lapse of time, or both) under, or give rise to a
right of termination, cancellation or acceleration of any obligation or to loss
of a material benefit under, or result in the creation of any Lien upon any of
the properties or assets of Parent under, any provision of any Contract to which
Parent is a party or by which any properties or assets of Parent are bound or,
subject to the filings and other matters referred to in the next sentence, any
provision of any Order or Law applicable to Parent or the properties or assets
of Parent. No Consent of, or registration, declaration or filing with, any
Governmental Entity is required to be obtained or made by or with respect to
Parent in connection with the execution, delivery and performance of this
Agreement or the consummation of the transactions contemplated hereby, other
than such reports by Parent under Sections 13(d) and 16 of the Exchange Act as
may be required in connection with this Agreement and the transactions
contemplated hereby.
Section 3. COVENANTS OF EACH SUBJECT SHAREHOLDER. Each Subject
Shareholder covenants and agrees as follows:
(a) (1) At any meeting of the stockholders of the Company called to
seek the Company Stockholder Approval or in any other circumstances upon which a
vote, consent or other approval (including by written consent) with respect to
the Merger Agreement or any of the transactions contemplated thereby, including
the Merger, and any actions that would reasonably be considered to be in
furtherance thereof, is sought, such Subject Shareholder shall, (i) if a meeting
is held, appear at such meeting or otherwise cause the Voting Shares (as defined
on SCHEDULE A hereto) to be counted as present at such meeting for purposes of
establishing a quorum and (ii) vote (or cause to be voted), including by
executing a written consent solicitation if requested by Parent, the Voting
Shares in favor of the Merger Agreement and the transactions contemplated
thereby, including the Merger, and take any other actions that would reasonably
be considered to be in furtherance thereof. Such Subject Shareholder represents
that any proxies heretofore given in respect of the Voting Shares that may still
be in effect are not irrevocable, and such proxies are hereby revoked.
(2) Such Subject Shareholder hereby irrevocably grants to, and
appoints, Parent, and any individual designated in writing by Parent, and each
of them individually, as such Subject Shareholder's proxy and attorney-in-fact
(with full power of substitution), for and in the name, place and stead of such
Subject Shareholder, to vote the Voting Shares, or grant a consent or approval
in respect of the Voting Shares, in a manner consistent with this SECTION 3.
Such Subject Shareholder hereby affirms that the irrevocable proxy set forth in
this SECTION 3(A)(2) is given in connection with the execution of the Merger
Agreement, and that such irrevocable proxy is given to secure the performance of
the duties of such Subject Shareholder under this Agreement. Such Subject
Shareholder hereby further affirms that the irrevocable proxy is coupled with an
interest and may under no circumstances be revoked. Such Subject Shareholder
hereby ratifies and confirms all that such irrevocable proxy may lawfully do or
cause to be done by virtue hereof. Such irrevocable proxy is executed and
intended to be irrevocable in accordance with the provisions of Section 212 of
the Delaware General Corporation Law (the "DGCL"). The irrevocable proxy granted
hereunder shall automatically terminate upon the termination of this Agreement.
Upon delivery of written request to do so by
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Parent, such Subject Stockholder shall as promptly as practicable execute and
deliver to Parent a separate written instrument or proxy that embodies the terms
of the irrevocable proxy set forth in this SECTION 3(A)(2); provided that such
written instrument or proxy shall (i) be in a form reasonably acceptable to such
Subject Shareholder, and (ii) terminate upon the termination of this Agreement.
Parent agrees that to the extent it exercises its rights under this SECTION
3(A)(2), Parent shall comply with the appearance and voting requirements imposed
on such Subject Shareholder by SECTION 3(A)(1) with respect to such Subject
Shareholder's Voting Shares.
(b) At any meeting of the stockholders of the Company or at any
adjournment thereof or in any other circumstances upon which such Subject
Shareholder's vote, consent or other approval is sought, such Subject
Shareholder shall vote (or cause to be voted) the Voting Shares against (i) any
transaction, consolidation, combination, sale of substantial assets, merger,
reorganization, recapitalization, dissolution, liquidation or winding up of or
by the Company (other than the Merger Agreement and the transactions
contemplated thereby, including the Merger), and (ii) any Company Takeover
Proposal (including any Superior Company Proposal), and (iii) any amendment of
the Company Charter or the Company Bylaws or other proposal or transaction
involving the Company or any Company Subsidiary, which amendment or other
proposal or transaction would in any manner impede, frustrate, prevent or
nullify any provision of the Merger Agreement or any of the transactions
contemplated thereby, including the Merger, or change in any manner the voting
rights of any class of capital stock of the Company. Such Subject Shareholder
shall not commit or agree to take any action inconsistent with the foregoing.
(c) Other than pursuant to this Agreement, such Subject Shareholder
shall not (i) sell, transfer, pledge, hypothecate, assign or otherwise dispose
of (including by gift), hedge or utilize a derivative to transfer the economic
interest in (collectively, "TRANSFER"), or enter into any Contract, option or
other arrangement (including any profit sharing arrangement) with respect to the
Transfer of, or propose to Transfer, any Subject Shares to any Person, (ii)
enter into, or propose to enter into, any voting arrangement, whether by proxy,
voting agreement or otherwise, with respect to any Subject Shares, (iii) take
any action that would make any representation or warranty of such Subject
Shareholder herein untrue or incorrect or have the effect of preventing or
disabling such Subject Shareholder from performing its obligations hereunder or
(iv) commit or agree to take any of the foregoing actions in clauses (i), (ii)
or (iii).
(d) Such Subject Shareholder shall not, and shall not authorize or
permit any of its Representatives to, directly or indirectly, take any action
to: (i) solicit, initiate, propose, encourage, facilitate or induce any
inquiries, discussions, proposals, indications of interest, submissions or
announcements of, any Company Takeover Proposal, or take any other action to
encourage, facilitate or assist any inquiries or discussions, or the making of
any proposal, indication of interest, submission or announcement, in each case,
that constitutes, or could reasonably be expected to lead to, any Company
Takeover Proposal, (ii) enter into any Acquisition Agreement, (iii) participate
or engage in any discussions or negotiations regarding any Company Takeover
Proposal, (iv) furnish to any Person (other than Parent, Sub or any
Representative of Parent or Sub) any non-public information relating to the
Company or any of the Company Subsidiaries, or afford to any Person (other than
Parent, Sub or any Representative of Parent or Sub) access to the business,
properties, assets, books, records or other non-public information, or to any
personnel, of the Company, any Company Subsidiary, or such Subject Shareholder
(to the extent related to the Company or any Company Subsidiary), in any such
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case, which could reasonably be expected to induce the making, proposal,
submission or announcement of, or could reasonably be expected to initiate,
encourage, facilitate or assist, a Company Takeover Proposal or any inquiries or
discussions, or the making of any proposal, indication of interest, submission
or announcement, in any such case, which could reasonably be expected to lead to
a Company Takeover Proposal, or (v) otherwise take any action with the primary
purpose of facilitating an effort or attempt by any Person to make a Company
Takeover Proposal. Without limiting the foregoing, it is agreed that any
violation of the restrictions set forth in the preceding sentence by any
Representative of such Subject Shareholder shall be deemed to be a breach of
this SECTION 3(D) by such Subject Shareholder. Each Subject Shareholder shall,
and shall cause its Representatives to, cease immediately and cause to be
terminated any and all existing discussions, conversations, negotiations and
other communications with any Person (other than Parent and its Affiliates)
conducted heretofore with respect to, or that could reasonably be expected to
lead to, a Company Takeover Proposal.
(e) Such Subject Shareholder shall not issue any press release or make
any other public statement with respect to this Agreement, the Merger Agreement
or any of the transactions contemplated hereby or thereby (including the
Merger), without the prior written consent of Parent (which consent may be
granted or withheld or delayed in such party's sole discretion), except as may
be required by applicable Law.
(f) Such Subject Shareholder hereby consents to and approves the
actions taken by the Company Board and the Special Committee thereof in
connection with the recommendation of the Company Board and the Special
Committee thereof in favor of the Merger. Such Subject Shareholder hereby
waives, and agrees not to exercise or assert, any appraisal rights under Section
262 of the DGCL in connection with the Merger Agreement and the transactions
contemplated thereby, including the Merger.
(g) Notwithstanding anything to the contrary in this Agreement and in
this SECTION 3 in particular, such Subject Shareholder is only executing this
Agreement in his capacity as the Beneficial Owner, or owner of record, of the
Subject Shares.
(h) This Agreement shall apply to each Subject Shareholder solely in
his, her or its capacity as a stockholder of the Company, and (subject to the
provisions of the Merger Agreement) nothing in this Agreement shall in any way
restrict or limit such Subject Shareholder or any of its Representatives,
employees or Affiliates who are directors or officers of the Company from taking
(or omitting to take) any action in such Person's capacity as a director or
officer of the Company, or pursuant to such Person's fiduciary duties under
applicable Law as a director or officer of the Company, as determined by such
Person in good faith (after consultation with outside counsel), and none of such
actions in such Person's capacity as an officer or director shall be deemed to
constitute a breach of this Agreement.
Section 4. TERMINATION. This Agreement shall terminate upon the
earlier of (a) the Closing Date, and (b) the termination of the Merger Agreement
in accordance with its terms, other than with respect to the liability of any
party for willful and malicious breach hereof prior to such termination.
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Section 5. ADDITIONAL MATTERS. Each Subject Shareholder and Parent
shall, from time to time, execute and deliver, or cause to be executed and
delivered, such additional or further consents, documents and other instruments
as the other party may reasonably request for the purpose of effectively
carrying out the transactions contemplated by this Agreement.
Section 6. GENERAL PROVISIONS.
(a) AMENDMENTS. This Agreement may not be amended except by an
instrument in writing signed by Parent and any Subject Shareholder materially
adversely affected thereby.
(b) NOTICE. All notices and other communications hereunder shall be in
writing and shall be deemed given in accordance with SECTION 9.2 of the Merger
Agreement to Parent and each Subject Shareholder at their address set forth on
SCHEDULE A hereto (or at such other address for a party as shall be specified by
like notice).
(c) INTERPRETATION. When a reference is made in this Agreement to
Sections, such reference shall be to a Section to this Agreement unless
otherwise indicated. The headings contained in this Agreement are for reference
purposes only and shall not affect in any way the meaning or interpretation of
this Agreement. Wherever the words "include", "includes" or "including" are used
in this Agreement, they shall be deemed to be followed by the words "without
limitation". Any reference to the masculine, feminine or neuter gender shall
include such other genders and any reference to the singular or plural shall
include the other, in each case unless the context otherwise requires. Each
party hereto has participated in the drafting of this Agreement, which each
party acknowledges and agrees is the result of extensive negotiations among the
parties.
(d) SEVERABILITY. If any term or other provision of this Agreement is
invalid, illegal or incapable of being enforced by any rule or Law, or public
policy, all other conditions and provisions of this Agreement shall nevertheless
remain in full force and effect so long as the economic or legal substance of
the transactions contemplated hereby is not affected in any manner materially
adverse to any party. Upon such determination that any term or other provision
of this Agreement is invalid, illegal or incapable of being enforced, the
parties hereto shall negotiate in good faith to modify this Agreement so as to
effect the original intent of the parties as closely as possible in an
acceptable manner to the end that transactions contemplated hereby are fulfilled
to the extent possible.
(e) COUNTERPARTS. This Agreement may be executed in one or more
counterparts, including via facsimile, all of which shall be considered one and
the same agreement and shall become effective when one or more counterparts have
been signed by each party and delivered to the other party.
(f) ENTIRE AGREEMENT; NO THIRD-PARTY BENEFICIARIES. This Agreement (i)
constitutes the entire agreement and supersedes all prior agreements and
understandings, both written and oral, among the parties with respect to the
subject matter hereof, and (ii) except as provided in the last sentence of this
SUBSECTION (F), is not intended to confer upon any stockholder, employee,
director, officer or other Person other than the parties hereto any rights or
remedies. CBT Holdings, LLC ("CBT") hereby agrees that the standstill provisions
of paragraph
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7 of the confidentiality agreement, dated December 18, 2009, between the Company
and ONCAP Management Partners, L.P. shall apply to CBT until the later of (i)
July 30, 2010 or (ii) the earliest to occur of (a) consummation of the
transactions contemplated by the Merger Agreement, or (b) termination of the
Merger Agreement. The parties agree that the Company is a third-party
beneficiary of this Agreement solely for the purpose of enforcing the foregoing
standstill provision, and CBT acknowledges that the Company is relying on CBT's
standstill commitment in entering into the Merger Agreement.
(g) GOVERNING LAW. This Agreement shall be governed by and construed
in accordance with the Laws of the State of Delaware (without giving effect to
choice of law principles thereof that would result in the application of the
Laws of another jurisdiction).
(h) JURISDICTION; VENUE. The parties hereto hereby (a) submit to the
exclusive personal jurisdiction of the Court of Chancery of the State of
Delaware, New Castle County, or, if that court does not have jurisdiction, a
federal court sitting in Delaware in the event any dispute arises out of this
Agreement or any transaction contemplated hereby, for the purpose of any Action
arising out of or relating to this Agreement or any transaction contemplated
hereby brought by any party hereto, and (b) irrevocably waive, and agree not to
assert by way of motion, defense, or otherwise, in any such Action, any claim
that it is not subject personally to the jurisdiction of the above-named courts,
that its property is exempt or immune from attachment or execution, that the
Action is brought in an inconvenient forum, that the venue of the Action is
improper, or that this Agreement may not be enforced in or by any of the
above-named courts.
(i) WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO HEREBY WAIVES TO
THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW ANY RIGHT IT MAY HAVE TO A TRIAL
BY JURY WITH RESPECT TO ANY ACTION DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER
OR IN CONNECTION WITH THIS AGREEMENT. EACH OF THE PARTIES HERETO (A) CERTIFIES
THAT NO REPRESENTATIVE OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR
OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF ANY SUCH ACTION,
SEEK TO ENFORCE THAT FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER
PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER
THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 6(I).
(j) ASSIGNMENT. Neither this Agreement nor any of the rights,
interests or obligations under this Agreement shall be assigned, in whole or in
part, by operation of Law or otherwise by any party without the prior written
consent of the other party; provided, that Parent may assign this Agreement and
its rights and interests but not its obligations hereunder to any of its
Affiliates. Any purported assignment in contravention of the foregoing shall be
void. Subject to the terms of this SECTION 6(J), this Agreement will be binding
upon, inure to the benefit of, and be enforceable by, the parties and their
respective successors and assigns.
(k) ENFORCEMENT. The parties agree that irreparable injury would occur
in the event that any of the provisions of this Agreement were not performed in
accordance with their specific terms or were otherwise breached and that
damages, even if available, will not be an adequate remedy. Accordingly, each
party hereby consents (in addition to any other remedy that
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may be available to the non-breaching party whether in Law or equity) to: (1)
any decree or order of specific performance to enforce the observance and
performance of such covenant or obligation, or (2) any injunction restraining
such breach or threatened breach, in each case, without requiring proof of
actual damages and without any requirement to obtain, furnish or post any bond
or similar instrument. The parties further agree that no other party nor any
other Person shall be required to obtain, furnish or post any bond or similar
instrument in connection with or as a condition to such first party obtaining
any remedy referred to in this SECTION 6(K), and each party irrevocably waives
any right such party may have to require the obtaining, furnishing or posting of
any such bond or similar instrument.
******
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IN WITNESS WHEREOF, each party has duly executed this Agreement, all as of
the date first written above.
SAGE PARENT COMPANY, INC.
By: /s/ Michael Lay
---------------------------------------
Name: Michael Lay
Title: President
BLACK DIAMOND OFFSHORE LTD.
By: Carlson Capital, L.P.,
its investment advisor
By: Asgard Investment Corp.,
its general partner
By: /s/ Clint D. Carlson
---------------------------------------
Name: Clint D. Carlson
Title: President
DOUBLE BLACK DIAMOND
OFFSHORE LTD.
By: Carlson Capital, L.P.,
its investment advisor
By: Asgard Investment Corp.,
its general partner
By: /s/ Clint D. Carlson
--------------------------------------
Name: Clint D. Carlson
Title: President
CBT HOLDINGS LLC
By: /s/ Kashif Sheikh
---------------------------------------
Name: Kashif Sheikh
Title: Manager
SCHEDULE A
NAME AND ADDRESS OF PARENT:
Sage Parent Company, Inc.
c/o ONCAP Investment Partners II L.P.
161 Bay Street
48th Floor, P.O. Box 220
Toronto, Ontario M5J 2S1
Attn: Mark Gordon
Facsimile: (416) 214-6106
with a copy (which shall not constitute notice) to:
O'Melveny & Myers LLP
7 Times Square
New York, NY 10036
Attn: Douglas A. Ryder, Esq. and Paul S. Scrivano, Esq.
Facsimile: (212) 326-2061
NAME AND ADDRESS NUMBER OF SHARES OF
OF SUBJECT SHAREHOLDER COMPANY COMMON STOCK BENEFICIALLY
OWNED
Black Diamond Offshore Ltd. 219,819
2100 McKinney Avenue, Suite 1600
Dallas, TX 75201
Attention: William A. Lockhart
with a copy to:
Carlson Capital, L.P.
2100 McKinney Avenue, Suite 1600
Dallas, Texas 75201
Attention: Steve Pully
Double Black Diamond Offshore Ltd. 2,489,781
2100 McKinney Avenue, Suite 1600
Dallas, TX 75201
Attention: William A. Lockhart
with a copy to:
Carlson Capital, L.P.
2100 McKinney Avenue, Suite 1600
Dallas, Texas 75201
Attention: Steve Pully
CBT Holdings LLC 2,044,072
10877 Wilshire Boulevard, Suite 2200
Los Angeles, California 90024
Attention: Mr. Kashif Sheikh
with a copy to:
Munger, Tolles & Olson LLP
355 South Grand Avenue, 35th Floor
Los Angeles, CA 90071
Telecopy No.: (213) 683-5137
Attention: Robert B. Knauss, Esq.
"VOTING SHARES" mean the "Subject Shares" as defined in the Agreement and set
forth opposite the name and address of each Subject Shareholder above, except
that in the event that the Company Board or the Special Committee, as
applicable, makes an Adverse Recommendation Change in accordance with the Merger
Agreement, then for so long as such Adverse Recommendation Change is in effect
the amount of Voting Shares held by Black Diamond Offshore Ltd. shall be reduced
to such highest number of shares such that the total Voting Shares of all
Subject Shareholders in the aggregate are not more than 35% of the total issued
and outstanding shares of Company Common Stock.