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EXHIBIT 10.14
AMENDED AND RESTATED CREDIT AGREEMENT
THIS AMENDED AND RESTATED CREDIT AGREEMENT (this "Agreement") dated as
of February 27, 2001 by and between HeadHunter.NET, Inc., a corporation
organized under the laws of the State of Georgia (the "Borrower"), and Omnicom
Finance, Inc., a corporation organized under the laws of the State of Delaware
(the "Lender").
RECITAL
This Agreement amends, restates and supercedes the Credit Agreement,
dated as of July 19, 2000 (the "Prior Agreement"), between Borrower and Lender.
ARTICLE I - DEFINITIONS
Section 1.01 Definitions. For the purposes of this Agreement:
"Acceptable Equity Issuance" means a public offering by Borrower of
Borrower's securities registered on a registration statement filed with the
Securities and Exchange Commission in which the gross cash proceeds to Borrower
are at least $30.0 million; provided, however, that any offering to Borrower's
employees, directors and consultants registered on Form S-8 or any business
combination registered on Form S-4 shall not be deemed to be an Acceptable
Equity Issuance.
"Applicable Conversion Price" shall mean, except as otherwise set forth
herein, the then applicable Conversion Price, not to exceed $8.55 per share.
"Applicable Interest Conversion Price" shall mean the applicable price
determined as follows for the periods specified (such periods, "Interest
Prepayment Periods") (i) for the interest prepayment period commencing on April
1, 2001 and ending on March 31, 2002, $7.125 per share, (ii) for the interest
prepayment period commencing on April 1, 2002 and ending on March 31, 2003, 90%
of the Conversion Price as defined herein except that the reference period for
this purpose will be the ten trading day period ending on March 31, 2002, (iii)
for the interest prepayment period commencing on April 1, 2003 and ending on
March 31, 2003, 90% of the Conversion Price as defined herein except that the
reference period for this purpose will be the ten trading day period ending on
March 31, 2003, and (iv) for the interest prepayment period commencing on April
1, 2004 and ending on June 30, 2004, 90% of the Conversion Price as defined
herein except that the reference period for this purpose will be the ten trading
day period ending on March 31, 2004.
"Applicable Law" means all applicable provisions of constitutions,
statutes, laws, rules, regulations and orders of all governmental bodies and all
orders, rulings and decrees of all courts and arbitrators of any jurisdiction.
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"Applicable Rate" means the interest rate charged by Lender to United
States Subsidiaries of Omnicom Group Inc. ("OMC US Subs") for short-term
borrowings as in effect from time to time, which rate is currently calculated
based on the 30-day commercial paper rate placed through dealers as published
for the last Business Day of each month in the Wall Street Journal in the "MONEY
RATES" column plus 110 basis points, provided, that such method of calculation
may be changed by Lender in its sole discretion as long as Borrower is charged
no greater rate than the rate charged by Lender to OMC US Subs from time to
time; provided, further however, that for purposes of Section 2.04(c) hereof,
the "Applicable Rate" for, if applicable, March 2001 and the year ended March
31, 2002, shall mean 6.65%. Any calculation of the Applicable Rate will be made
on the basis of a 360-day year with 12 30-day months.
"Business Day" means any day other than a Saturday, Sunday or other day
on which banks in Atlanta and New York City are authorized or required to close.
"Cash Merger" means the (i) merger, consolidation or other business
combination transaction of Borrower with or into another corporation (with
respect to which less than a majority of the outstanding voting power of the
surviving or consolidated corporation is held by the stockholders of Borrower
immediately prior to such event) or (ii) sale or transfer of all or
substantially all of the properties and assets of Borrower and its Subsidiaries,
in each case unless the consideration paid in such merger, consolidation,
business combination transaction or property and asset sale or transfer consists
solely of equity securities of the acquiring Person.
"Common Stock" means the common stock, par value $0.01 per share, of
Borrower, or any other capital stock that has the right to vote generally for
directors of Borrower.
"Conversion Price" shall mean the average of the daily volume weighted
average prices (based on a trading day from 9:30 a.m. to 4:00 p.m., eastern
time) of the Common Stock on the Nasdaq National Market (or any other national
securities exchange on which the shares of Common Stock are then listed for
trading) as reported by Bloomberg Financial LP using the AQR function (the
"Market Price") for the ten trading days ending (a) on the last trading day
prior to the date such Conversion Notice was delivered to Borrower (the
"Conversion Measurement Date") or (b) on the Conversion Acceptance Date (as
defined below) in the event that the Market Price has declined between the
Conversion Measurement Date and the date upon which Lender receives a notice
from Borrower that it has elected to accept the conversion and not deliver a
Conversion Blockage Notice or, if Lender does not receive any such notice within
five Business Days of the date on which the Conversion Notice is given, on the
close of business on that date (either such date, as applicable, the "Conversion
Acceptance Date").
"ERISA" means the Employee Retirement Income Security Act of 1974, as
in effect from time to time.
"Event of Default" means any of the events specified in Section 8.01.
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"Governmental Approvals" means all authorizations, consents, approvals,
licenses and exemptions of, registrations and filings with, and reports to, all
governmental bodies.
"Incur" means issue, assume, guarantee, incur or otherwise become
liable for; provided, however, that any Indebtedness or capital stock of a
Person existing at the time such Person becomes a Subsidiary (whether by merger,
consolidation, acquisition or otherwise) shall be deemed to be Incurred by such
Subsidiary at the time it becomes a Subsidiary.
"Indebtedness" means, with respect to any Person on any date of
determination (without duplication):
(i) the principal of and premium (if any) in respect of
indebtedness of such Person for borrowed money,
(ii) the principal of and premium (if any) in respect of
obligations of such Person evidenced by bonds, debentures, notes or
other similar instruments,
(iii) all obligations of such Person in respect of letters
of credit or other similar instruments (including reimbursement
obligations with respect thereto), but shall not include commercial
letters of credit or letters of credit issued in connection with
liabilities incurred in the ordinary course of business (including
those issued to governmental entities to self-insure under applicable
worker's compensation statutes and to landlords in connection with real
property lease obligations) prior to the time of a drawing that gives
rise to a reimbursement obligation,
(iv) all Indebtedness of other Persons secured by a Lien
on any asset of such Person, whether or not such Indebtedness is
assumed by such Person; provided, however, that the amount of
Indebtedness of such Person shall be the lesser of (A) the fair market
value of such asset at such date of determination and (B) the amount of
such Indebtedness of such other Persons, and
(v) all Indebtedness of other Persons to the extent such
Person has any primary or secondary payment obligation (whether fixed
or contingent and whether arising under a guaranty, an instrument or a
promise of any kind).
"Investment" in any Person means any direct or indirect advance, loan
or other extension of credit (including by way of guarantee or similar
arrangement) or capital contribution to (by means of any transfer of cash or
other property to others or any payment for property or services for the account
or use of others), or any purchase or acquisition of capital stock, Indebtedness
or other similar instruments issued by such Person.
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"Loan Documents" means this Agreement, the Note, and any other document
or instrument executed and delivered by Borrower or Lender in connection
herewith or therewith.
"Material Adverse Effect" means (a) with respect to Borrower, a
materially adverse effect on (i) the business, properties, condition (financial
or otherwise), results of operations or performance of Borrower, or (ii) the
ability of Borrower to perform its obligations under any Loan Document to which
it is a party and (b) with respect to Lender, a materially adverse effect on (i)
the business, properties, condition (financial or otherwise), results of
operations or performance of Lender or (ii) the ability of Lender to perform its
obligations under any Loan Document to which it is a party.
"Maturity Date" means the earliest to occur of (i) June 30, 2004, (ii)
ten Business Days after the closing of an Acceptable Equity Issuance, (iii) the
date on which the Loan comes due pursuant to any provision hereof, and (iv) the
closing of a Cash Merger.
"Net Proceeds" means, in respect of an Acceptable Equity Issuance, the
aggregate amount of all cash received by Borrower in respect of such Acceptable
Equity Issuance net of investment banking fees, legal fees, accountants fees,
underwriting discounts and commissions and other customary fees and expenses
actually incurred by Borrower in connection with such Acceptable Equity
Issuance.
"Note" means the promissory note of Borrower in favor of Lender dated
July 19, 2000 for an aggregate principal amount of $10,000,000.
"Person" means an individual, corporation, partnership, limited
liability company, association, trust or unincorporated organization, or a
government or any agency or political subdivision thereof.
"Plan" means any employee benefit plan within the meaning of Section
3(3) of ERISA.
"Post-Default Rate" means a rate per annum equal to two percent (2.0%)
plus the Applicable Rate as in effect from time to time.
"Subsidiary" of any Person means any corporation, association,
partnership or other business entity of which more than 50% of the total voting
power of shares of capital stock or other interests (including partnership
interests) 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 (i) such Person or (ii) one or
more Subsidiaries of such Person.
"Threshold Price" shall mean (i) for the period from the date of this
Agreement to and including September 30, 2001, $7.125 per share and (ii) from
and after October 1, 2001, $6.00 per share.
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References in this Agreement to "Sections", "Articles", and "Exhibits" are to
sections, articles, and exhibits herein and hereto unless otherwise indicated.
references in this Agreement to any document, instrument or agreement (a) shall
include all exhibits, schedules and other attachments thereto, (b) shall include
all documents, instruments or agreements issued or executed in replacement
thereof, to the extent permitted hereby and (c) shall mean such document,
instrument or agreement, or replacement or predecessor thereto, as amended,
supplemented, restated or otherwise modified from time to time to the extent
permitted hereby and in effect at any given time. Wherever from the context it
appears appropriate, each term stated in either the singular or plural shall
include the singular and plural, and pronouns stated in the masculine, feminine
or neuter gender shall include the masculine, the feminine and the neuter.
Titles and captions of Articles, Sections, subsections and clauses in this
Agreement are for convenience only, and neither limit nor amplify the provisions
of this Agreement. Unless otherwise indicated, all references to time are
references to Eastern standard time.
ARTICLE II - LOAN
Section 2.01. Loan. On August 23, 2000, Lender made a loan (the "Loan")
to Borrower in an aggregate principal amount equal to Ten Million Dollars
($10,000,000).
Section 2.02. Repayment of Loan. Borrower shall repay the aggregate
outstanding principal balance of the Loan, all accrued and unpaid interest
thereon and all other amounts due and payable under the Loan Documents (such
amounts collectively, "Loan Obligations"), in full on the Maturity Date. In the
event of any breach by Lender of (1) the representations and warranties
contained in Article V of this Agreement or (2) the covenants contained in
Article VII of this Agreement, the obligation of Borrower to repay hereunder
shall not be affected and Borrower shall have no right to withhold repayment of
any Loan Obligations upon any such breach.
Section 2.03. Prepayments.
(a) Voluntary. Borrower may prepay the Loan (in whole or in part)
at any time without premium or penalty. Borrower shall give Lender at least
three Business Days (and by 11:00 am on such third Business Day) prior written
notice (such notice, a "Prepayment Notice") of the prepayment of the Loan. Upon
receipt of such Prepayment Notice (which shall be irrevocable) Borrower shall be
obligated to make the prepayment on the date and in the principal amount
specified in such Prepayment Notice, together with all accrued and unpaid
interest thereon (unless interest for such period has been prepaid as provided
in Section 2.04(b)), except to the extent Lender has exercised its conversion
rights under this Agreement prior to actual receipt of such prepayment and as to
which Borrower has not delivered a Conversion Blockage Notice in accordance with
Section 2.07(a). Such prepayments may only be made on a Business Day.
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(b) Mandatory. Borrower shall apply Net Proceeds of an Acceptable
Equity Issuance to repay in full all Loan Obligations (unless interest for such
period has been prepaid as provided in Section 2.04(b)), within ten Business
Days of receipt of such Net Proceeds. Such a prepayment shall be made on a
Business Day upon at least ten Business Days prior notice (by 11:00 am on such
Business Day). Such Prepayment Notice shall not restrict Lender from exercising
its conversion rights under this Agreement prior to actual receipt of such
prepayment.
Section 2.04. Rates and Payment of Interest on the Loan.
(a) Rate Generally; Default Rate. Borrower promises to pay to
Lender interest on the unpaid principal amount of the Loan for the period from
and including the date of the making of the Loan to but excluding the date the
Loan shall be paid in full, at a per annum rate equal to the Applicable Rate.
Notwithstanding the foregoing, during the continuance of an Event of Default,
Borrower shall pay to Lender interest at the Post-Default Rate on the
outstanding principal amount of the Loan and on all other amounts payable by
Borrower hereunder. Interest payable at the Post-Default Rate shall be payable
from time to time on demand by Lender.
(b) Payment of Interest. Accrued interest on the Loan shall be
payable quarterly on the seventh Business Day of March, June, September and
December in each year, for any quarterly period prior to February 28, 2001 and
on the seventh Business Day of April, July, October and January for each
quarterly period beginning with the second calendar quarter of 2001, provided,
however, that if Borrower fails to elect to pay interest for the month of March
2001 in Common Stock in lieu of cash as permitted under Section 2.04(c), on or
prior to April 10, 2001 Borrower will pay to Lender interest for the month of
March at the Applicable Rate.
(c) Prepayment of Interest. Notwithstanding anything in this
Agreement or the Note to the contrary, Borrower may prepay all interest that may
accrue on the Loan for any Interest Prepayment Period (assuming for purposes of
determining the amount of such prepayment that interest will continue to accrue
for such period at the then Applicable Rate on the entire unpaid principal
amount of the Loan as of the date of such payment) (the aggregate amount of such
interest, the "Gross Prepaid Interest Amount") by issuing to Lender that number
of fully paid and non-assessable shares of Common Stock (rounded down to the
nearest 100 shares) equal to the quotient of (i) the Gross Prepaid Interest
Amount divided by (ii) the then Applicable Interest Conversion Price. Such
prepayments may only be made during the first ten Business Days of any
applicable Interest Payment Period, provided, however, that notwithstanding any
other provision hereof, for the Interest Prepayment Period ending March 31, 2002
(the "First Prepayment Period"):
(1) such prepayment must be made on or prior to March 30,
2001; and
(2) at the option of Borrower, interest for the month of
March 2001 may be paid in Common Stock in lieu of
cash at an Applicable
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Conversion Price equal to $7.125 per share as herein
contemplated for any Interest Prepayment Period in
which event, notwithstanding any other provision
hereof and without duplication of payment, the Gross
Prepaid Interest Amount for the First Prepayment
Period will be increased by $55,416.67 and, if
Borrower so elects to pay interest for March 2001 in
Common Stock as herein contemplated, it will have no
further obligation to pay interest in respect of
March 2001.
Section 2.05. Payments. Unless otherwise set forth herein, all payments
to Lender shall be made by Borrower in United States dollars in immediately
available funds free and clear and without deduction for any set-off,
counterclaim, levy, withholding or any other deduction of any kind not later
than 2:00 p.m. on the due date thereof in accordance with written payment
instructions provided by Lender to Borrower from time to time. Interest shall be
computed on the basis of a year of 360 days and actual days elapsed.
Section 2.06. Usury. In no event shall the amount of interest due or
payable on the Loan exceed the maximum rate of interest allowed by Applicable
Law and, if any such payment is paid by Borrower or received by Lender, then
such excess sum shall be credited as a payment of principal, unless Borrower
shall notify Lender in writing that Borrower elects to have such excess sum
returned to it forthwith. It is the express intent of the parties hereto that
Borrower not pay and Lender not receive, directly or indirectly, in any manner
whatsoever, interest in excess of that which may be lawfully paid by Borrower
under Applicable Law.
Section 2.07. Conversion Right.
(a) Conversion Notice. Subject to (i) Section 2.07(b) below and
(ii) the right of Borrower to notify (a "Conversion Blockage Notice") Lender
within five Business Days of Borrower's receipt of the Conversion Notice that it
has elected (which election will be irrevocable if and when made) to prepay all
or any portion of the principal and interest for which Lender has exercised its
conversion rights pursuant to Section 2.03, at any time after July 1, 2001,
Lender will have the right, exercisable at any time on or before the Maturity
Date and by written notice to Borrower (such notice, a "Conversion Notice"), to
convert all or any portion of the then unpaid principal and any unpaid interest
that is due and payable on the Note (to the extent not previously converted into
Common Stock) into that number of fully paid and nonassessable shares of Common
Stock (rounded down to the nearest 100 shares) equal to the quotient of (i) the
aggregate amount of principal and interest specified in such Conversion Notice
(such amount, the "Conversion Amount") divided by (ii) the then Applicable
Conversion Price. The Conversion Notice shall specify the Conversion Amount and
the then Applicable Conversion Price. If, after receipt by Borrower of a
Conversion Notice, Borrower delivers to Lender a Conversion Blockage Notice,
Borrower shall prepay the Conversion Amount specified in the Applicable
Conversion Notice in cash within 10 Business Days after the delivery of such
Conversion Blockage Notice.
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(b) Limitation on Conversion Amount. In the event the Applicable
Conversion Price specified in the Conversion Notice is less than the Threshold
Price, the Conversion Amount for which Lender may exercise its conversion rights
pursuant to this Section 2.07 shall not exceed the following amounts during the
period set forth below, together with any amount for any prior period for which
Lender has not previously exercised its conversion rights:
Date of Borrower's Receipt of
Conversion Notice Amount
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July 1, 2001 to and including
September 30, 2001 $ 750,000
October 1, 2001 to and including
December 31, 2001 $1,000,000
January 1, 2002 to and including
March 31, 2002 $1,250,000
April 1, 2002 to and including
June 30, 2002 and any calendar
quarter thereafter $1,500,000
(c) Delivery of Shares. Borrower shall deliver a certificate or
certificates for shares of its Common Stock issuable upon the exercise of its
conversion rights pursuant to this Agreement or shall cause a book entry to be
recorded on its books or of the Depositary Trust Company or other appropriate
Person reflecting the ownership of such Common Stock as soon as practicable
after receipt by Borrower of the Conversion Notice, and in any event within 10
Business Days of Borrower's receipt of the Conversion Notice; provided, however,
that the person or persons to whom such certificates are issuable shall be
considered the holder of record of the shares of Common Stock as of the date six
Business Days after Borrower's receipt of such Conversion Notice unless, during
such period, a Conversion Blockage Notice has been delivered by Borrower.
ARTICLE III - CONDITIONS PRECEDENT
Section 3.01. Conditions Precedent. Upon the execution and delivery of
this Agreement by the parties hereto and receipt by Lender of the following
documents duly executed and delivered by the parties hereto:
(i) An Amended and Restated Registration Rights
Agreement, in the form attached hereto as Exhibit A;
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(ii) An Amended and Restated Shareholders' Agreement, in
the form attached hereto as Exhibit B;
(iii) An Amendment No. 1 to the Shareholder Protection
Rights Agreement, in the form attached hereto as Exhibit C; and
(iv) Copies certified by the Secretary or Assistant
Secretary of Borrower of the corporate action taken by Borrower to
authorize the execution, delivery and performance of the Loan Documents
to which it is a party, the issuance of Common Stock pursuant to this
Agreement and the reservation for issuance of a sufficient number of
shares of Common Stock as required to provide for the exercise of the
conversion rights provided for in this Agreement;
this Agreement will become operative and will amend, restate and supercede the
Prior Agreement in its entirety.
ARTICLE IV - REPRESENTATIONS AND WARRANTIES OF BORROWER
Section 4.01. Representations and Warranties. Borrower represents and
warrants to Lender as of the date of this Agreement and as of the date of the
Note as follows:
(a) Organization; Power; Qualification. Borrower is a corporation,
duly organized, validly existing and in good standing under the jurisdiction of
its incorporation, has the power and authority to own its properties and to
carry on its business as now being and hereafter proposed to be conducted and is
duly qualified and authorized to do business in each jurisdiction in which the
character of its properties or the nature of its business requires such
qualification or authorization and where the failure to be so qualified would
have a Material Adverse Effect on Borrower.
(b) Authorization of and Enforceability of Loan Documents.
Borrower has the right, authority and power, and has taken all necessary
corporate action to authorize it, to execute, deliver and perform the Loan
Documents to which it is a party (and to borrow the Loan and issue shares of
Common Stock as required to provide for the exercise of conversion rights
provided for in this Agreement) in accordance with their respective terms. The
Loan Documents to which Borrower is a party have been duly authorized, executed
and delivered by the duly authorized officers of Borrower, and each is a legal,
valid and binding obligation of Borrower enforceable against it in accordance
with its terms, except as the same may be limited by bankruptcy, insolvency, and
other similar laws affecting the rights of creditors generally and the
availability of equitable remedies for the enforcement of certain obligations
(other than the payment of principal) contained herein or therein may be limited
by equitable principles generally.
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(c) Conversion Stock. Borrower has taken all necessary corporate
action to reserve a sufficient number of shares of Common Stock as required to
provide for the exercise of conversion rights provided for in this Agreement.
The shares of Common Stock issued in accordance with this Agreement will, when
so issued, be duly authorized, validly issued, fully paid and nonassessable,
listed on the NASDAQ, and will be issued to Lender, free of any lien or other
statutory or contractual preemptive right or right of first refusal.
(d) Compliance of Agreement, Note, Loan Documents and Borrowing
with Laws, Etc. The execution, delivery and performance of this Agreement, the
Note and the other Loan Documents to which Borrower is a party in accordance
with their respective terms, the borrowings hereunder and the issuance of shares
of Common Stock as required to provide for the exercise of conversion rights
provided for in this Agreement do not and will not, by the passage of time, the
giving of notice, or both: (i) require any Governmental Approval or violate any
Applicable Law relating to Borrower, which if not obtained or violated would
have a Material Adverse Effect on Borrower; (ii) conflict with, result in a
breach of or constitute a default under the articles of incorporation or the
bylaws of Borrower, or any indenture, agreement or other instrument to which
Borrower is a party or by which it or any of its respective properties is bound;
or (iii) result in the creation or imposition of any lien or security interest
on any of the assets of Borrower.
(e) Litigation. There are no actions, suits or proceedings pending
(nor, to the knowledge of Borrower, threatened) against or in any other way
relating adversely to or affecting Borrower in any court or before any
arbitrator of any kind or before or by any other governmental authority which,
if adversely determined, would have a Material Adverse Effect on Borrower.
(f) Compliance with Law; Governmental Approvals. Borrower is in
compliance with each Governmental Approval applicable to it and in compliance
with all other Applicable Law relating to Borrower except for noncompliances
which, and Governmental Approvals the failure to possess which, would not,
individually or in the aggregate, reasonably be likely to have a Material
Adverse Effect on Borrower.
(g) Capitalization. As of February 26, 2001, the Company had
20,279,021 shares of Common Stock issued and outstanding.
ARTICLE V - REPRESENTATIONS AND WARRANTIES OF LENDER
Section 5.01. Representations and Warranties. Lender represents and
warrants to Borrower as of the date of this Agreement and the date of the Note
as follows:
(a) Organization; Power; Qualification. Lender is a corporation,
duly organized, validly existing and in good standing under the jurisdiction of
its incorporation, has the power and authority to own its properties and to
carry on its business as now being and hereafter proposed to be conducted and is
duly qualified and authorized to do business in each jurisdiction in which the
character of its properties or the nature of its business requires such
qualification or authorization and where the failure to be so qualified would
have a Material Adverse Effect on Lender.
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(b) Authorization and Enforceability of Loan Documents. Lender has
the right, authority and power, and has taken all necessary corporate action to
authorize it, to execute, deliver and perform the Loan Documents to which it is
a party in accordance with their respective terms. The Loan Documents to which
Lender is a party have been duly executed and delivered by the duly authorized
officers of Lender, and each is a legal, valid and binding obligation of Lender
enforceable against it in accordance with its terms, except as the same may be
limited by bankruptcy, insolvency, and other similar laws affecting the rights
of creditors generally and the availability of equitable remedies for the
enforcement of certain obligations (other than the payment of principal)
contained herein or therein may be limited by equitable principles generally.
(c) Compliance of Agreement, Loan Documents with Laws, Etc. The
execution, delivery and performance of this Agreement and the other Loan
Documents to which Lender is a party in accordance with their respective terms
do not and will not, by the passage of time, the giving of notice, or both: (i)
require any Governmental Approval or violate any Applicable Law relating to
Lender, which if not obtained or violated would have a Material Adverse Effect
on Lender; or (ii) conflict with, result in a breach of or constitute a default
under the certificate of incorporation or the bylaws of Lender, or any
indenture, agreement or other instrument to which Lender is a party or by which
it or any of its respective properties is bound.
(d) Litigation. There are no actions, suits or proceedings pending
(nor, to the knowledge of Lender, threatened) against or in any other way
relating adversely to or affecting Lender in any court or before any arbitrator
of any kind or before or by any other governmental authority which, if adversely
determined, would have a Material Adverse Effect on Lender.
(e) Compliance with Law; Governmental Approvals. Lender is in
compliance with each Governmental Approval applicable to it and in compliance
with all other Applicable Law relating to Lender except for noncompliances
which, and Governmental Approvals the failure to possess which, would not,
individually or in the aggregate, have a Material Adverse Effect on Lender.
(f) Funding Sources. None of the funds used by Lender to finance
the Loan include assets of any Plan, other than a Plan exempt from the coverage
of ERISA.
ARTICLE VI - COVENANTS OF BORROWER
For so long as any portion of the Loan remains unpaid, or this
Agreement is in effect, Borrower shall comply with the following covenants:
Section 6.01. Preservation of Corporate Existence and Similar Matters.
(a) Borrower shall preserve and maintain its corporate existence, rights,
franchises, licenses and privileges in the jurisdiction of its incorporation and
qualify and remain
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qualified as a foreign corporation and authorized to do business in each
jurisdiction in which the character of its properties or the nature of its
businesses require such qualification or authorization and where the failure to
be so qualified would reasonably be likely to have a Material Adverse Effect on
Borrower.
(b) Borrower shall not merge into, or consolidate with, another
legal entity, or effect any other transaction in which Borrower Common Stock is
converted into cash, securities or other property unless, prior thereto or
immediately thereafter, (i) all Loan Obligations shall have been discharged in
full (and, in such event, a Prepayment Notice shall not be required) or (ii) (x)
proper provision shall have been made so that, following such transaction, upon
conversion of the Loan in accordance with Section 2.07 hereof the holder of the
Loan shall be entitled to the same consideration to which it would have been
entitled had it converted the Loan immediately prior to the record date for such
transaction and (y) the surviving or resulting entity shall have executed an
agreement reasonably satisfactory to the holder of a majority of the principal
amount of the Loan assuming all of Borrower's obligations hereunder.
Section 6.02. Compliance with Applicable Law. Borrower shall comply
with all Applicable Law, including the obtaining of all Governmental Approvals,
except where non-compliance would not reasonably be likely to have a Material
Adverse Effect on Borrower.
Section 6.03. Maintenance of Property. Borrower shall protect and
preserve all of its properties, and maintain in good repair, working order and
condition all of its respective tangible properties, ordinary wear and tear
excepted.
Section 6.04. Use of Proceeds. Borrower shall use the proceeds of the
Loan for general corporate purposes.
Section 6.05. Inspection of Books, Records, Properties. Borrower shall
allow Lender, during normal business hours and following reasonable prior
written notice, to inspect the books, records and properties of Borrower and to
discuss the business and financial affairs of Borrower with representatives of
Borrower, including, without limitation, Borrower's public accountants.
Section 6.06. Information. Borrower shall, from time to time, deliver
to Lender such data, certificates, reports, statements, documents or further
information regarding the business, properties, condition (financial or
otherwise), results of operations or performance of Borrower as Lender may
reasonably request in writing.
Section 6.07. Acceptable Equity Issuance. Borrower shall notify Lender
promptly of the closing of an Acceptable Equity Issuance.
Section 6.08. Notice of Default. Immediately upon the happening of any
condition or event which constitutes an Event of Default, Borrower shall furnish
Lender
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with written notice specifying the nature and period of existence thereof and
the action being taken or proposed to be taken with respect thereto.
Section 6.09. Insurance. Borrower shall maintain insurance policies and
programs of a type and in amounts that are customary and appropriate for
businesses similar to the business in which it is engaged.
Section 6.10. Financial Statements. Borrower shall furnish to Lender:
(a) at the same time as filed with Borrower's Annual Report on
Form 10-K for each fiscal year of Borrower, (1) a copy of the audited
consolidated balance sheet of Borrower and its subsidiaries as at the end of
such year and the related audited consolidated financial statements of income
for such year, setting forth in each case in comparative form the figures for
the immediately preceding year, reported on without a "going concern" or like
qualification or exception, or qualification arising out of the scope of the
audit, by Arthur Andersen LLP or other independent certified public accountants
of nationally recognized standing and (2) a compliance certificate containing
all information and calculations necessary for determining compliance with the
financial covenant contained in Section 6.13 hereof as of the last day of such
fiscal year; and
(b) at the same time as filed with Borrower's Quarterly Report on
Form 10-Q for each of the first three fiscal quarterly periods of each fiscal
year of Borrower, (1) the unaudited consolidated balance sheet of Borrower and
its subsidiaries as at the end of such quarter and the related unaudited
consolidated statements of income for such quarter and the portion of the fiscal
year through the end of such quarter, setting forth in each case in comparative
form the figures for the previous year, certified by the Chief Financial Officer
of Borrower as being fairly stated in all material respects (subject to normal
year-end audit adjustments and the omission of footnotes) and (2) a compliance
certificate containing all information and calculations necessary for
determining compliance with the financial covenant contained in Section 6.13
hereof as of the last day of such fiscal quarter.
All such financial statements shall be complete and correct in all material
respects and shall be prepared in reasonable detail and in accordance with GAAP
applied consistently throughout the periods reflected therein and with prior
periods (except as approved by such accountants or the Chief Financial Officer,
as the case may be, and disclosed therein).
Section 6.11. Payment of Indebtedness. Borrower shall pay, discharge or
otherwise satisfy at or before maturity all of its material indebtedness (other
than trade debt and accounts payable), except where the amount or validity
thereof is currently being contested in good faith by appropriate proceedings
and reserves in conformity with GAAP with respect thereto have been provided in
the financial statements of Borrower.
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Section 6.12. Capital Expenditures. Borrower shall not make or commit
to make any Capital Expenditures, except for Capital Expenditures of Borrower
and its subsidiaries in the ordinary course of business not exceeding $5,000,000
in any calendar year plus the aggregate amount of net proceeds for any debt or
equity offering plus, if in any calendar year Borrower or a Subsidiary of
Borrower acquires another Person (or business division of another Person) (a
"Target"), 110% of the aggregate amount of capital expenditures made by such
Target in the rolling 12 months immediately preceding such acquisition. For
purposes of this Section 6.12, "Capital Expenditures" shall mean expenditures
that are or should be capitalized in accordance with GAAP.
Section 6.13. Limitation on Indebtedness. Borrower shall not, and shall
not permit any Subsidiary to, incur any Indebtedness, other than:
(a) Indebtedness represented by the Note;
(b) Indebtedness of Borrower to any wholly-owned Subsidiary, and
of any Subsidiary to Borrower or any other wholly-owned Subsidiary;
(c) Indebtedness outstanding on the date of this Agreement and
described in reasonable detail on Schedule 6.13(c) and any refinancing or
replacement thereof in whole or in part in an aggregate amount not to exceed the
original amount of such Indebtedness;
(d) Indebtedness of a Subsidiary at the time such Person became a
Subsidiary of Borrower, provided that such Indebtedness was not created or
incurred in contemplation of such transaction;
(e) secured or unsecured purchase money Indebtedness (including
capital leases) incurred by Borrower or any Subsidiary to finance the
acquisition of assets used in the business if (i) no Event of Default then
exists, (ii) such Indebtedness does not exceed the purchase price of the assets
so acquired, (iii) any lien or security interest securing such Indebtedness
attaches only to the assets so acquired and secures only such purchase money
Indebtedness, and (iv) the acquisition of such assets is permitted under Section
6.12; and
(f) Senior Indebtedness.
For purposes of this Agreement, "Senior Indebtedness" means Indebtedness for at
least $2.5 million by Borrower and/or its Subsidiaries.
Section 6.14. Limitation on Restricted Payments. Borrower shall not,
and shall not permit any Subsidiary to, directly or indirectly (i) declare or
pay any dividend or make any distribution on or in respect of its capital stock
(including any payment in connection with any merger or consolidation involving
Borrower or any Subsidiary), except dividends or distributions payable solely in
its capital stock or payable solely to
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Borrower, (ii) purchase, redeem, retire or otherwise acquire for value any
capital stock of Borrower or any Subsidiary held by Persons other than Borrower
or another wholly-owned Subsidiary, (iii) pay, purchase, repurchase, redeem,
defease or otherwise acquire or retire for value, prior to scheduled maturity,
scheduled repayment or scheduled sinking fund payment any Indebtedness or other
obligations of Borrower or any of its Subsidiaries, provided, however, that
Indebtedness may be prepaid in connection with a refinancing of such
Indebtedness so long as the principal amount of the refinancing Indebtedness
does not exceed the principal amount of the Indebtedness so refinanced,
provided, further, that the payment of revolving loans during the term of the
Senior Indebtedness facility shall be permitted, or (iv) make any Investment in
any Person who is known to Borrower to be the holder or beneficial owner of more
than 10% of the then-outstanding Common Stock (any such dividend, distribution,
purchase, redemption, repurchase, defeasance, other acquisition, retirement or
Investment being herein referred to as a "Restricted Payment").
Section 6.15. Reservation of Common Stock. Borrower shall at all times
reserve and keep available out of its authorized but unissued shares of Common
Stock a sufficient number of shares as required to provide for the exercise of
the conversion rights provided for in this Agreement.
ARTICLE VII - COVENANTS OF LENDER
For so long as this Agreement is in effect, Lender, at the request of
Borrower, in connection with Borrower's incurrence of any Senior Indebtedness,
will enter into an agreement in form and substance reasonably satisfactory to
the initial lender or holder of such Senior Indebtedness (such Person, the
"Senior Lender") whereby Lender's rights to the payment of any or all Loan
Obligations will be subordinated to the rights of the Senior Lender to payment
of such Senior Indebtedness and any other monies due or to become due under the
terms of such Senior Indebtedness, provided, however, that (1) no such agreement
(a "Subordination Agreement") may restrict in any respect Lender's conversion
rights under Section 2.07 hereof and (2) in the event that Borrower is
prohibited from paying any amount due hereunder or Lender is prohibited from
exercising any right under Article VIII hereof pursuant to the Subordination
Agreement, Lender upon notice to Borrower may require that Borrower prepay
interest under the Loan in Common Stock at the times and otherwise in accordance
with Section 2.04(c) hereof.
ARTICLE VIII - DEFAULT
Section 8.01. Events of Default. Each of the following shall constitute
an Event of Default:
(a) Default in Payment. Borrower shall fail to pay the principal
of, or interest on, the Loan, or any other amount due under the Loan Documents,
when and as due (whether upon demand, at maturity, by reason of acceleration or
otherwise).
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(b) Misrepresentations. Any written statement, representation or
warranty made by Borrower under or pursuant to any Loan Document shall prove to
have been incorrect or misleading in any material respect when made.
(c) Default in Performance. Borrower shall fail to perform or
observe any term, covenant, condition or agreement contained in this Agreement
or any other Loan Document to which it is a party and not otherwise mentioned in
this Section and such failure shall continue for a period of 30 days after the
date upon which Borrower has received written notice of such failure from
Lender.
(d) Debt Cross-Default. Borrower shall fail to pay when due and
payable the principal of, or interest on, any Indebtedness having an aggregate
outstanding principal amount of $1,000,000 or more (other than any such failure
with respect to any Senior Indebtedness).
(e) Debt Acceleration. The maturity of any Indebtedness (including
any Senior Indebtedness) shall have (i) been accelerated in accordance with the
provisions of any indenture, contract or instrument evidencing, providing for
the creation of or otherwise concerning such Indebtedness or (ii) been required
to be prepaid or repurchased prior to the stated maturity thereof.
(f) Voluntary Bankruptcy Proceeding. Borrower shall: (i) commence
a voluntary case under federal bankruptcy laws (as now or hereafter in effect);
(ii) file a petition seeking to take advantage of, or commence any proceeding or
other action under, any other Applicable Laws, domestic or foreign, relating to
bankruptcy, insolvency, reorganization, winding-up, or composition or adjustment
of debts; (iii) consent to, or fail to contest in a timely and appropriate
manner, any petition filed against it in an involuntary case under such
bankruptcy laws or other Applicable Laws or consent to any proceeding or action
described in the immediately following subsection; (iv) apply for or consent to,
or fail to contest in a timely and appropriate manner, the appointment of, or
the taking of possession by, a receiver, custodian, trustee, or liquidator of
itself or of a substantial part of its property, domestic or foreign; (v) admit
in writing its inability to pay its debts as they become due; (vi) make a
general assignment for the benefit of creditors; or (vii) take any corporate or
similar action for the purpose of effecting any of the foregoing.
(g) Involuntary Bankruptcy Proceeding. A case or other proceeding
shall be commenced against Borrower, in any court of competent jurisdiction
seeking: (i) relief under federal bankruptcy laws (as now or hereafter in
effect) or under any other Applicable Laws, domestic or foreign, relating to
bankruptcy, insolvency, reorganization, winding-up, or composition or adjustment
of debts; or (ii) the appointment of a trustee, receiver, custodian, liquidator
or the like for Borrower, or of all or any substantial part of its assets, and
such case or proceeding shall continue undismissed or unstayed for a period of
60 consecutive calendar days, or an order granting any remedy or other relief
requested in such case or proceeding against Borrower (including, but not
limited to, an order for relief under such federal bankruptcy laws) shall be
entered.
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Section 8.02. Remedies. Subject to the terms of any applicable
Subordination Agreement, upon the occurrence of an Event of Default, Lender may
exercise any or all of the following rights and remedies:
(a) Acceleration. If any Event of Default shall have occurred and
be continuing, Lender may: (i) declare the principal of, and accrued but unpaid
interest on, the Loan at the time outstanding to be forthwith immediately due
and payable, whereupon the same shall immediately become due and payable without
presentment, demand, protest or other notice of any kind, all of which are
expressly waived, anything in any Loan Document to the contrary notwithstanding
and (ii) terminate this Agreement; provided, however, that if the Event of
Default set forth in Section 8.01(e) or 8.01(f) hereof shall have occurred, all
of the principal of, and accrued but unpaid interest on, the Loan shall become
automatically due and payable.
(b) Other Remedies. Lender may exercise any and all of its rights
under any and all of the other Loan Documents and under any Applicable Law.
Section 8.03. Rights Cumulative. The rights and remedies of Lender
under the Loan Documents shall be cumulative and not exclusive of any rights or
remedies which it would otherwise have. In exercising its rights and remedies
Lender may be selective and no failure or delay by Lender in exercising any
right shall operate as a waiver of such right, nor shall any single or partial
exercise of any power or right preclude its other or further exercise or the
exercise of any other power or right.
ARTICLE IX - MISCELLANEOUS
Section 9.01. Notices. Unless otherwise provided herein, communications
provided for hereunder shall be in writing and shall be mailed, telecopied or
delivered as follows:
If to Borrower:
HeadHunter.NET, Inc.
333 Research Court
Suite 200
Norcross, Georgia 30092
Attention: Chief Executive Officer
Telecopy Number: (770) 349-2401
Telephone Number: (770) 349-2400
If to Lender:
Omnicom Finance, Inc.
437 Madison Avenue
New York, New York 10022
Attention: Chief Executive Officer
Telecopy Number: (212) 817-6557
Telephone Number: (212) 415-3000
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with a copy to:
Omnicom Group Inc.
437 Madison Avenue
New York, New York 10022
Attention: Robert A. Profusek
Telecopy Number: (212) 817-6988
Telephone Number: (212) 415-3737
or, as to each party at such other address as shall be designated by such party
in a written notice to the other parties delivered in compliance with this
Section. All such notices and other communications shall be effective (i) if
mailed, when received; (ii) if telecopied, when transmitted; or (iii) if hand
delivered, when delivered.
Section 9.02. Indemnity; Expenses.
(a) In consideration of the execution and delivery of this
Agreement by Lender, Borrower hereby indemnifies, exonerates and holds Lender
and its affiliates and each of their respective officers, directors, employees
and agents (each an "Indemnitee") free and harmless from and against any and all
actions, causes of action, suits, losses, costs, liabilities and damages, and
expenses incurred in connection therewith (irrespective of whether any such
Indemnitee is a party to the action for which indemnification hereunder is
sought), including reasonable attorneys' fees and disbursements (collectively,
the "Indemnified Liabilities"), incurred by the Indemnitees or any of them as a
result of, or arising out of, or relating to the execution, delivery,
enforcement, performance and administration of this Agreement or any other Loan
Document, except for Indemnified Liabilities arising for the account of a
particular Indemnitee by reason of the relevant Indemnitee's gross negligence or
willful misconduct.
(b) Without limiting the foregoing, Borrower agrees to pay or
reimburse Lender for (i) up to $15,000 of the fees and disbursements (calculated
at normal hourly rates) of counsel to Lender ("Legal Costs") incurred on or
after February 20, 2001 in connection with the negotiation, execution and
delivery of this Agreement, (ii) Lender's Legal Costs incurred in connection
with any Subordination Agreement or any amendment, modification or other change
to any Loan Document, and (iii) all costs and expenses (including without
limitation Legal Costs) incurred in connection with the enforcement or
preservation of any rights under the Loan Documents, including without
limitation Legal Costs.
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(c) The agreements in this Section 9.02 shall survive the payment
in full of the Loan and the termination of this Agreement and the other Loan
Documents for a period of one year after the termination of this Agreement and
the other Loan Documents.
Section 9.03. Litigation.
(a) EACH PARTY HERETO ACKNOWLEDGES THAT ANY DISPUTE OR CONTROVERSY
BETWEEN BORROWER AND LENDER WOULD BE BASED ON DIFFICULT AND COMPLEX ISSUES OF
LAW AND FACT AND WOULD RESULT IN DELAY AND EXPENSE TO THE PARTIES. ACCORDINGLY,
TO THE EXTENT PERMITTED BY APPLICABLE LAW, EACH OF LENDER AND BORROWER HEREBY
WAIVES ITS RIGHT TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING OF ANY KIND OR
NATURE IN ANY COURT OR TRIBUNAL IN WHICH AN ACTION MAY BE COMMENCED BY OR
AGAINST ANY PARTY HERETO ARISING OUT OF THIS AGREEMENT, THE NOTE, OR ANY OTHER
LOAN DOCUMENT OR BY REASON OF ANY OTHER SUIT, CAUSE OF ACTION OR DISPUTE
WHATSOEVER BETWEEN BORROWER AND LENDER OF ANY KIND OR NATURE.
(b) EACH OF BORROWER AND LENDER HEREBY AGREES THAT ONLY THE UNITED
STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK AND ANY STATE COURT
LOCATED IN NEW YORK COUNTY, SHALL HAVE JURISDICTION TO HEAR AND DETERMINE ANY
CLAIMS OR DISPUTES BETWEEN BORROWER AND LENDER, PERTAINING DIRECTLY OR
INDIRECTLY TO THIS AGREEMENT, THE LOAN, THE NOTE OR ANY OTHER LOAN DOCUMENT OR
TO ANY MATTER ARISING HEREFROM OR THEREFROM. BORROWER AND LENDER EXPRESSLY
SUBMIT AND CONSENT IN ADVANCE TO SUCH JURISDICTION IN ANY ACTION OR PROCEEDING
COMMENCED IN SUCH COURTS. BORROWER AND LENDER EACH HEREBY WAIVES PERSONAL
SERVICE OF THE SUMMONS AND COMPLAINT, OR OTHER PROCESS OR PAPERS ISSUED THEREIN,
AND AGREES THAT SERVICE OF SUCH SUMMONS AND COMPLAINT, OR OTHER PROCESS OR
PAPERS MAY BE MADE BY REGISTERED OR CERTIFIED MAIL ADDRESSED TO BORROWER OR
LENDER, AS APPLICABLE, AT ITS ADDRESS FOR NOTICES PROVIDED FOR HEREIN. SHOULD
BORROWER OR LENDER FAIL TO APPEAR OR ANSWER ANY SUMMONS, COMPLAINT, PROCESS OR
PAPERS SO SERVED WITHIN THIRTY DAYS AFTER THE MAILING THEREOF, SUCH PARTY SHALL
BE DEEMED IN DEFAULT AND AN ORDER AND/OR JUDGMENT MAY BE ENTERED AGAINST IT AS
DEMANDED OR PRAYED FOR IN SUCH SUMMONS, COMPLAINT, PROCESS OR PAPERS.
(c) EACH PARTY FURTHER WAIVES ANY OBJECTION THAT IT MAY NOW OR
HEREAFTER HAVE TO THE VENUE OF ANY SUCH ACTION OR PROCEEDING IN ANY SUCH COURT
OR THAT SUCH ACTION OR PROCEEDING WAS BROUGHT IN AN INCONVENIENT FORUM AND EACH
AGREES NOT TO PLEAD OR CLAIM THE SAME.
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(d) THE CHOICE OF FORUM SET FORTH IN THIS SECTION SHALL NOT BE
DEEMED TO PRECLUDE THE BRINGING OF ANY ACTION BY LENDER OR THE ENFORCEMENT BY
LENDER OF ANY JUDGMENT OBTAINED IN SUCH FORUM IN ANY OTHER APPROPRIATE
JURISDICTION.
(e) THE FOREGOING WAIVERS HAVE BEEN MADE WITH THE ADVICE OF
COUNSEL AND WITH A FULL UNDERSTANDING OF THE LEGAL CONSEQUENCES THEREOF, AND
SHALL SURVIVE THE PAYMENT OF THE LOANS AND ALL OTHER AMOUNTS PAYABLE HEREUNDER
OR UNDER THE OTHER LOAN DOCUMENTS AND THE TERMINATION OF THIS AGREEMENT.
Section 9.04. Amendments. Except as otherwise expressly provided in
this Agreement, any consent or approval required or permitted by this Agreement
or in any Loan Document to be given by Lender may be given, and any term of this
Agreement or of any other Loan Document may be amended, and the performance or
observance by Borrower of any terms of this Agreement or such other Loan
Document or the continuance of any Event of Default may be waived (either
generally or in a particular instance and either retroactively or prospectively)
with, but only with, the written consent of Lender (and, in the case of an
amendment to any Loan Document, the written consent of Borrower).
Section 9.05. Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO
CONTRACTS EXECUTED, AND TO BE FULLY PERFORMED, IN SUCH STATE.
Section 9.06. Termination; Survival of Provisions. Except as otherwise
set forth herein, this Agreement shall terminate on the date Borrower shall have
paid Lender all Loan Obligations.
Section 9.07. Counterparts. This Agreement and any amendments, waivers,
consents or supplements may be executed in any number of counterparts and by
different parties hereto in separate counterparts, each of which when so
executed and delivered shall be deemed an original, but all of which
counterparts together shall constitute but one and the same instrument.
Section 9.08. Entire Agreement. This Agreement, the Note, and the other
Loan Documents referred to herein embody the final, entire agreement among the
parties hereto and supersede any and all prior commitments, agreements
(including the Prior Agreement), representations, and understandings, whether
written or oral, relating to the subject matter hereof and may not be
contradicted or varied by evidence of prior, contemporaneous, or subsequent oral
agreements or discussions of the parties hereto.
Section 9.09. Construction. Borrower and Lender acknowledge that each
of them has had the benefit of legal counsel of its own choice and has been
afforded an opportunity to review this Agreement and the other Loan Documents
with its legal
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counsel and that this Agreement and the other Loan Documents shall be construed
as if jointly drafted by Borrower and Lender.
Section 9.10. Benefits; Assignment. The provisions of this Agreement
shall be binding upon and inure to the benefit of the parties hereto and their
respective successors and permitted assigns, except that neither party may
assign or otherwise transfer any of its rights under this Agreement without the
prior written consent of the other party.
[Signature on Next Page]
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IN WITNESS WHEREOF, the parties hereto have caused this Amended and
Restated Credit Agreement to be executed by their authorized officers all as of
the day and year first above written.
HEADHUNTER.NET, INC.
By: /s/ Craig Stamm
---------------------------------
Chief Financial Officer
OMNICOM FINANCE, INC.
By: /s/ Dennis E. Hewitt
---------------------------------
Treasurer
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SCHEDULE 6.13(C)
INDEBTEDNESS
None.
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EXHIBIT A
AMENDED AND RESTATED
REGISTRATION RIGHTS AGREEMENT
THIS AMENDED AND RESTATED REGISTRATION RIGHTS AGREEMENT (this
"Agreement") is made and entered into as of February 27, 2001, among
HEADHUNTER.NET, INC., a Georgia corporation (the "Company"), BERNARD HODES GROUP
INC. ("BHA"), a Delaware corporation and wholly owned subsidiary of Omnicom
Group Inc. ("Omnicom"), OMNICOM FINANCE, INC., a Delaware corporation and wholly
owned subsidiary of Omnicom ("OFI"), and ITC HOLDING COMPANY, INC., a Delaware
corporation ("ITC") (each of BHA, OFI and ITC may be referred to as an
"Investor" and collectively as the "Investors").
R E C I T A L
WHEREAS, the Company and the Investors entered into a Registration
Rights Agreement, dated as of July 19, 2000 (the "Prior Agreement"), and desire
at this time to amend and restate the Prior Agreement in its entirety as herein
provided.
NOW, THEREFORE, in consideration of the foregoing premises and for
other good and valuable consideration, the parties hereby agree as follows:
1. DEFINITIONS
As used in this Agreement, the following terms have the respective
meanings set forth below:
Commission: shall mean the Securities and Exchange Commission or any
other federal agency at the time administering the Securities Act;
Effective Date: shall mean July 19, 2000;
Exchange Act: shall mean the Securities Exchange Act of 1934, as
amended;
Holder: shall mean any holder of Registrable Securities, including the
Investors;
Initiating Holder: shall mean (1) any Investor who holds any then
outstanding Registrable Securities or (2) any Holder or Holders who in the
aggregate are Holders of more than 5% of the then outstanding Registrable
Securities;
Person: shall mean an individual, partnership, joint stock company,
corporation, trust or unincorporated organization, and a government or agency or
political subdivision thereof;
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register, registered and registration: shall mean a registration
effected by preparing and filing a registration statement in compliance with the
Securities Act (and any post-effective amendments filed or required to be filed)
and the declaration or ordering of effectiveness of such registration statement;
Registrable Securities: shall mean (A) the shares of Company Common
Stock (1) issued to BHA under the Agreement and Plan of Merger, dated as of
April 15, 2000, by and among the Company and the additional parties thereto (as
amended, the "Acquisition Agreement"), and any transferee thereof, (2) held by
ITC at the Effective Date, (3) issuable to ITC (or a wholly owned subsidiary of
ITC) upon exercise of any option or warrant beneficially owned by ITC (or one of
its wholly owned subsidiaries) to purchase shares of Company Common Stock, and
(4) issued to OFI or any of its affiliates (collectively with BHA and its
affiliates, the "Omnicom Group") pursuant to the Amended and Restated Credit
Agreement, dated the date hereof, between the Company and OFI (the "Credit
Agreement"), and any transferee thereof, and (B) any securities of the Company
issued as a dividend or other distribution with respect to, or in exchange or
conversion for or in replacement of, the shares of Company Common Stock referred
to in clause (A); provided, that Registrable Securities shall not include (i)
securities with respect to which a registration statement with respect to the
sale of such securities has become effective under the Securities Act and all
such securities have been disposed of in accordance with such registration
statement, (ii) such securities as are actually sold pursuant to Rule 144 (or
any successor provision thereto) under the Securities Act ("Rule 144"), (iii)
such securities as are acquired by the Company or any of its subsidiaries or
(iv) the shares of common stock issued to BHA under the Acquisition Agreement
which are registered for resale by BHA under the BHA Resale Registration
Statement (as defined in Section 3(c)) and which are actually sold under such
BHA Resale Registration Statement;
Registration Expenses: shall mean all expenses incurred by the Company
in compliance with Sections 3(a), (b), (c) and (d) hereof, including, without
limitation, all registration and filing fees, printing expenses, fees and
disbursements of counsel for the Company, fees and expenses of one counsel for
all the Holders, blue sky fees and expenses and the expense of any special
audits incident to or required by any such registration (but excluding Selling
Expenses);
Security, Securities: shall have the meaning set forth in Section 2(1)
of the Securities Act;
Securities Act: shall mean the Securities Act of 1933, as amended; and
Selling Expenses: shall mean all underwriting discounts and selling
commissions applicable to the sale of Registrable Securities and all fees and
disbursements of counsel for each of the Holders other than fees and expenses of
one counsel for all the Holders.
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2. RESTRICTIONS ON TRANSFER
(a) Prior to any proposed transfer of any Registrable
Securities (other than under the circumstances described in Section 3 hereof
including transfers pursuant to the BHA Resale Registration Statement), the
Holder thereof shall give written notice to the Company of its intention to
effect such transfer. Each such notice shall describe the manner of the proposed
transfer and, if requested by the Company, shall be accompanied by an opinion of
counsel reasonably satisfactory to the Company to the effect that the proposed
transfer may be effected without registration under the Securities Act,
whereupon such Holder shall be entitled to transfer the Registrable Securities
in accordance with the terms of its notice.
(b) Notwithstanding anything in this Agreement to the
contrary, in connection with any underwritten public offering of securities by
the Company which closes within one year of the Effective Date, the Holders
hereby agree, if and to the extent agreed to by the Investors and the executive
officers of the Company, not to sell or otherwise dispose of any Company Common
Stock for a period equal to the lesser of (i) 90 days following completion of
such public offering, or (ii) the period agreed to by other shareholders who
execute lock-up agreements in connection with such offering. If requested by an
underwriter in connection with an underwritten public offering of securities by
the Company pursuant to the immediately preceding sentence, each Holder will
execute and deliver promptly a lock-up agreement which reflects the agreements
of each Holder contained in this Section 2(b) and such other terms and
conditions as are usual and customary for lock-up agreements in underwritten
public offerings.
(c) Notwithstanding anything in this Agreement to the
contrary, nothing herein will be deemed to confer any rights upon any Person who
purchases Company Common Stock pursuant to the BHA Resale Registration Statement
(a "Resale Transferee"), nor will anything herein be deemed to restrict any
subsequent transfers of such Company Common Stock by such Resale Transferees.
3. REGISTRATION RIGHTS
(a) Requested Registration.
(i) Request for Registration. If the Company
shall receive from an Initiating Holder, at any time on or after the first
anniversary of the Effective Date, a written request that the Company effect any
registration with respect to (1) all of such Investor's Registrable Securities
or (2) at least such number of Registrable Securities as would yield (based on
then current market prices) an aggregate offering price of at least $5 million,
the Company will, unless all of the Registrable Securities being requested to be
registered under (1) or (2) above are eligible for resale in accordance with
Rule 144 within a three-month period:
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(A) promptly give written notice of the proposed
registration, qualification or compliance to all other Holders; and
(B) as soon as practicable (and in any event,
within 45 days of any valid request), use its reasonable best efforts
to effect such registration (including, without limitation, the
execution of an undertaking to file post-effective amendments,
appropriate qualification under applicable blue sky or other state
securities laws and appropriate compliance with applicable regulations
issued under the Securities Act) as may be so requested and as would
permit or facilitate the sale and distribution of all or such portion
of such Registrable Securities as are specified in such request,
together with all or such portion of the Registrable Securities of any
Holder or Holders joining in such request as are specified in a written
request received by the Company within ten business days after written
notice from the Company is given under Section 3(a)(i)(A) above;
provided that the Company shall not be obligated to effect, or take any
action to effect, any such registration pursuant to this Section 3(a):
(w) Solely with respect to underwritten
registrations requested pursuant to this Agreement, if the
Company shall have previously effected an underwritten
registration with respect to Registrable Securities pursuant
to Section 3(b) hereof, the Company shall not be required to
effect any underwritten registration pursuant to this Section
3(a) until a period of 180 days shall have elapsed from the
effective date of the most recent such previous registration;
provided that if, in the most recent such previous
registration, participation pursuant to Section 3(b) hereof
shall not have been to the extent requested pursuant to
Section 3(b) hereof, then the Company shall not be required to
effect any underwritten registration pursuant to this Section
3(a) until a period of 90 days shall have elapsed from the
effective date of the most recent such previous registration;
(x) If, upon receipt of a registration
request pursuant to this Section 3(a), the Company is advised
in writing (with a copy to each Initiating Holder) by a
recognized national independent investment banking firm
selected by the Company that, in such firm's opinion, a
registration at the time and on the terms requested would
adversely affect any then pending public offering of
securities of the Company by the Company (other than in
connection with benefit and similar plans) (collectively, a
"Company Offering") with respect to which the Company has
filed a registration statement prior to the receipt of a
registration request pursuant to this Section 3(a), the
Company shall not be required to effect a registration
pursuant to this Section 3(a) until the earlier of (i) 30 days
after the completion of such Company Offering, (ii) promptly
after any abandonment of such Company Offering or (iii) 60
days after the date of receipt of a registration request
pursuant to this Section 3(a); provided, however, that the
periods during which the Company shall not be required to
effect a registration pursuant to this Section 3(a)
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together with any periods of suspension under Section 3(i)
hereof may not exceed 90 days in the aggregate during any
period of 12 consecutive months;
(y) In any particular jurisdiction in
which the Company would be required to execute a general
consent to service of process in effecting such registration,
qualification or compliance, unless the Company is already
subject to service in such jurisdiction and except as may be
required by the Securities Act or applicable rules or
regulations thereunder;
(z) Subject to Section 3(c), after the
Company has effected five (5) such registrations pursuant to
this Section 3(a) for each Investor and two (2) such
registrations for Holders other than the Investors and such
registrations have been declared or ordered effective and the
sales of such Registrable Securities shall have closed;
provided, that Holders shall not have the right to request an
underwritten registration pursuant to this Section 3(a) more
than one time in any six-month period.
The registration statement filed pursuant to the request of the
Initiating Holders may, subject to the provisions of Section 3(a)(ii) below,
include other Securities of the Company which are held by Persons who, by virtue
of agreements with the Company, are entitled to include their Securities in any
such registration ("Other Stockholders"); provided, however, that the
registration rights granted in the future to other shareholders will in all
events be subordinate to the rights hereunder and the Company will not grant any
such rights unless proper provision has been made in respect thereof.
(ii) Underwriting. If the Initiating Holders
intend to distribute the Registrable Securities covered by their request by
means of an underwriting, they shall so advise the Company as a part of their
request made pursuant to Section 3(a). If Other Stockholders request inclusion
in any such registration, the Holders shall offer to include the securities of
such Other Stockholders in the underwriting and may condition such offer on
their acceptance of the further applicable provisions of this Section 3. The
Holders whose shares are to be included in such registration and the Company
shall (together with all Other Stockholders proposing to distribute their
securities through such underwriting) enter into underwriting and related
agreements in customary form with the representative of the underwriter or
underwriters selected for such underwriting by the Initiating Holders and
reasonably acceptable to the Company. Such underwriting agreement will contain
such representations and warranties by the Company and such other terms and
provisions as are customarily contained in underwriting agreements with respect
to secondary distributions, including, without limitation, indemnities and
contribution to the effect and to the extent provided in Section 3(f) hereof and
the provision of opinions of counsel and accountants' letters to the effect and
to the extent provided in Section 3(e) hereof, and the representations and
warranties by, and the other agreements on the part of, the Company to and for
the benefit of such underwriters shall also be made to and for the benefit of
the Holders. The Company shall cooperate fully with the Holders and the
underwriters in connection with any underwritten offering. Notwithstanding any
other provision of this Section 3(a), if the
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representative advises the Holders in writing that marketing factors require a
limitation on the number of shares to be underwritten, the securities of the
Company held by Other Stockholders shall be excluded from such registration to
the extent so required by such limitation. If, after the exclusion of such
shares, still further reductions are still required, the number of shares
included in the registration by each Holder shall be reduced on a pro rata basis
(based on the number of shares held by such Holder), by such minimum number of
shares as is necessary to comply with such request; provided, that there shall
be no reduction in the number of shares included in the registration by any
Holder until all shares of Other Stockholders have been excluded from such
registration; provided further, however, that in the event that the number of
shares included in the registration by the Holder is reduced by greater than
one-third of the number of shares requested to be included by such Holder, then
such registration shall not count against such Investor as a requested
registration pursuant to Section 3(a)(i)(B)(z). No Registrable Securities or any
other securities excluded from the underwriting by reason of the underwriter's
marketing limitation shall be included in such registration. If any Other
Stockholder who has requested inclusion in such registration as provided above
disapproves of the terms of the underwriting, such person may elect to withdraw
therefrom by written notice to the Company, the underwriter and the Initiating
Holder. The securities so withdrawn shall also be withdrawn from registration.
If the underwriter has not limited the number of Registrable Securities or other
securities to be underwritten, the Company and officers and directors of the
Company may include its or their securities for its or their own account in such
registration if the representative so agrees and if the number of Registrable
Securities and other securities which would otherwise have been included in such
registration and underwriting will not thereby be limited.
(b) Company Registration.
(i) If the Company shall determine to register
any of its equity securities either for its own account or for the account of
Other Stockholders, other than a registration relating solely to benefit plans,
or a registration relating solely to a Commission Rule 145 transaction, or a
registration on any registration form which does not permit secondary sales or
does not include substantially the same information as would be required to be
included in a registration statement covering the sale of Registrable
Securities, the Company will:
(A) promptly give to each of the Holders a
written notice thereof; and
(B) include in such registration (and any
related qualification under blue sky laws or other compliance), and in
any underwriting involved therein, all the Registrable Securities
specified in a written request or requests, made by any Holder within
ten (10) business days after the giving of the written notice from the
Company described in clause (i) above, except as set forth in Section
3(b)(ii) below. Such written request shall specify the amount of
Registrable Securities
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intended to be disposed of by a Holder and may specify all or a part of
the Holders' Registrable Securities.
Notwithstanding the foregoing, if, at any time after giving such written notice
of its intention to effect such registration and prior to the effective date of
the registration statement filed in connection with such registration, the
Company shall determine for any reason not to register such equity securities
the Company may, at its election, give written notice of such determination to
the Holders and thereupon the Company shall be relieved of its obligation to
register such Registrable Securities in connection with the registration of such
equity securities (but not from its obligation to pay Registration Expenses to
the extent incurred in connection therewith as provided herein), without
prejudice, however, to the rights (if any) of Holders immediately to request
that such registration be effected as a registration under Section 3(a) hereof.
(ii) Underwriting. If the registration of which
the Company gives notice is for a registered public offering involving an
underwriting, the Company shall so advise each of the Holders as a part of the
written notice given pursuant to Section 3(b)(i)(A). In such event, the right of
each of the Holders to registration pursuant to this Section 3(b) shall be
conditioned upon such Holders' participation in such underwriting and the
inclusion of such Holders' Registrable Securities in the underwriting to the
extent provided herein. The Holders whose shares are to be included in such
registration shall (together with the Company and the Other Stockholders
distributing their securities through such underwriting) enter into an
underwriting agreement in customary form with the representative of the
underwriter or underwriters selected for the underwriting by the Company or such
Other Stockholders, as the case may be. Such underwriting agreement will contain
such representations and warranties by the Company and such other terms and
provisions as are customarily contained in underwriting agreements with respect
to secondary distributions, including, without limitation, indemnities and
contribution to the effect and to the extent provided in Section 3(f) hereof and
the provision of opinions of counsel and accountants' letters to the effect and
to the extent provided in Section 3(d), and the representations and warranties
by, and the other agreements on the part of, the Company to and for the benefit
of such underwriters shall also be made to and for the benefit of the Holders
whose shares are to be included in such registration. Notwithstanding any other
provision of this Section 3(b), if the representative determines that marketing
factors require a limitation on the number of shares to be underwritten, the
Company shall so advise all holders of securities requesting registration, and
the number of shares of securities that are entitled to be included in the
registration and underwriting shall be allocated in the following manner: The
securities of the Company held by officers, directors and Other Stockholders
(other than Other Stockholders exercising the contractual right initiating such
registration ("Other Demanding Holders") or to cause their securities to be
included in such registration ("Other Rights Holders")) shall be excluded from
such registration and underwriting to the extent required by such limitation,
and, if a limitation on the number of shares is still required, the number of
shares that may be included in the registration and underwriting by each of the
Holders and such Other Demanding Holders shall be reduced, on a pro rata basis
(based on the number of shares held by such holder), by
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31
such minimum number of shares as is necessary to comply with such limitation. If
any of the Holders or any officer, director or Other Stockholder disapproves of
the terms of any such underwriting, he may elect to withdraw therefrom by
written notice to the Company and the underwriter. Any Registrable Securities or
other securities excluded or withdrawn from such underwriting shall be withdrawn
from such registration.
(c) BHA Resale Registration Statement. Notwithstanding
any other provision hereof, the Company will, as promptly as practicable after
the date hereof, prepare and file with the SEC and use its commercially
reasonable best efforts to (i) cause a Post-Effective Amendment No. 1 on Form
S-3 to Form S-4 (as amended, and as continued pursuant to the immediately
following sentence, the "BHA Resale Registration Statement") to become effective
under the Securities Act and to maintain such effectiveness until July 19, 2001
(subject to continuation pursuant to this Section 3(c)), (ii) register in such
BHA Resale Registration Statement for resale by BHA all of the Registrable
Securities held by it on the date hereof (the "BHA Securities"), (iii) file such
amendments to the BHA Resale Registration Statement as are necessary to, as
promptly as practicable following BHA's written request, register for resale
such BHA Securities for any other member of the Omnicom Group to which BHA
transfers such BHA Securities, provided such member of the Omnicom Group cannot
dispose of all of such BHA Securities under Rule 144 in the succeeding
three-month period, and (iv) if necessary to file such amendments to the BHA
Resale Registration Statement to register for resale any shares of Company
Common Stock issued to OFI pursuant to the Credit Agreement. Without limiting
the foregoing, BHA may, at any time within 30 days prior to the expiration of
the BHA Resale Registration Statement (as may be continued pursuant to this
Section 3(c)), make a written request (a "BHA Resale Continuation Request") that
the Company continue the effectiveness of the BHA Resale Registration Statement.
In such event, the Company will use its reasonable best efforts to continue such
BHA Resale Registration Statement so as not to permit any interruption in the
effectiveness of such registration. Each BHA Resale Continuation Request that
has been effected in accordance with this Section 3(c) will be considered a
requested registration for BHA for the purposes of Section 3(a).
(d) Expenses of Registration. All Registration Expenses
incurred in connection with any registration, qualification or compliance
pursuant to this Section 3 shall be borne by the Company, and all Selling
Expenses shall be borne by the Holders of the securities so registered pro rata
on the basis of the number of their shares so registered; provided, however,
that if, as a result of the withdrawal of a request for registration by any of
the Holders (except if such withdrawal is at the request of the Company), the
registration statement does not become effective, the Holders and Other
Stockholders requesting registration may elect to bear the Registration Expenses
(pro rata on the basis of the number of their shares so included in the
registration request, or on such other basis as such Holders and Other
Stockholders may agree), in which case such registration shall not be counted as
a registration pursuant to Section 3(a)(i)(B)(z).
(e) Registration Procedures. In the case of each
registration effected by the Company pursuant to this Section 3 (including a
registration pursuant to a BHA Resale
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Continuation Request), the Company will keep the Holders, as applicable, advised
in writing as to the initiation of each registration and as to the completion
thereof. At its expense, the Company will:
(i) except as set forth in Section 3(c), keep such
registration effective for a period of one hundred eighty (180) days or
until the Holders have completed the distribution described in the
registration statement relating thereto, whichever first occurs;
(ii) furnish to each Holder, and to any underwriter before
filing with the Commission, copies of any registration statement
(including all exhibits) and any prospectus forming a part thereof and
any amendments and supplements thereto (including all documents
incorporated or deemed incorporated by reference therein prior to the
effectiveness of such registration statement and including each
preliminary prospectus, any summary prospectus or any term sheet (as
such term is used in Rule 434 under the Securities Act)) and any other
prospectus filed under Rule 424 under the Securities Act, which
documents, other than documents incorporated or deemed incorporated by
reference, will be subject to the review of the Holders and any such
underwriter for a period of at least five business days, and the
Company shall not file any such registration statement or such
prospectus or any amendment or supplement to such registration
statement or prospectus to which any Holder or any such underwriter
shall reasonably object within five business days after the receipt
thereof; a Holder or such underwriters, if any, shall be deemed to have
reasonably objected to such filing only if the registration statement,
amendment, prospectus or supplement, as applicable, as proposed to be
filed, contains a material misstatement or omission;
(iii) furnish to each Holder and to any underwriter, such
number of conformed copies of the applicable registration statement and
of each amendment and supplement thereto (in each case including all
exhibits) and such number of copies of the prospectus forming a part of
such registration statement (including each preliminary prospectus, any
summary prospectus or any term sheet (as such term is used in Rule 434
under the Securities Act)) and any other prospectus filed under Rule
424 under the Securities Act, in conformity with the requirements of
the Securities Act, and such other documents, including without
limitation documents incorporated or deemed to be incorporated by
reference prior to the effectiveness of such registration, as each of
the Holders or any such underwriter from time to time may reasonably
request;
(iv) to the extent practicable, promptly prior to the
filing of any document that is to be incorporated by reference into any
registration statement or prospectus forming a part thereof subsequent
to the effectiveness thereof, and in any event no later than the date
such document is filed with the Commission, provide copies of such
document to the Holders, if requested, and to any underwriter, and make
representatives of the Company available for discussion of such
document and other customary due diligence matters, and include in such
document prior to the
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filing thereof such information as any Holder or any such underwriter
reasonably may request;
(v) make available at reasonable times for inspection by
the Holders, any underwriter participating in any disposition pursuant
to such registration and any attorney or accountant retained by the
Holders or any such underwriter, all financial and other records,
pertinent corporate documents and properties of the Company and cause
the officers, directors and employees of the Company to supply all
information reasonably requested by the Holders and any such
underwriters, attorneys or accountants in connection with such
registration subsequent to the filing of the applicable registration
statement and prior to the effectiveness of the applicable registration
statement;
(vi) use its reasonable best efforts (x) to register or
qualify all Registrable Securities and other securities covered by such
registration under such other securities or blue sky laws of such
States of the United States of America where an exemption is not
available and as the sellers of Registrable Securities covered by such
registration shall reasonably request, (y) to keep such registration or
qualification in effect for so long as the applicable registration
statement remains in effect, and (z) to take any other action which may
be reasonably necessary or advisable to enable such sellers to
consummate the disposition in such jurisdictions of the securities to
be sold by such sellers, except that the Company shall not for any such
purpose be required to qualify generally to do business as a foreign
corporation in any jurisdiction where it is not so qualified, or to
subject itself to taxation in any such jurisdiction, or to execute a
general consent to service of process in effecting such registration,
qualification or compliance, unless the Company is already subject to
service in such jurisdiction and except as may be required by the
Securities Act or applicable rules or regulations thereunder;
(vii) use its reasonable best efforts to cause all
Registrable Securities covered by such registration statement to be
registered with or approved by such other federal or state governmental
agencies or authorities as may be necessary in the opinion of counsel
to the Company and counsel to the Holders of Registrable Securities to
enable the Holders thereof to consummate the disposition of such
Registrable Securities;
(viii) subject to Section 3(h) hereof, promptly notify each
Holder of Registrable Securities covered by a registration statement
(A) upon discovery that, or upon the happening of any event as a result
of which, the prospectus forming a part of such registration statement,
as then in effect, includes an untrue statement of a material fact or
omits to state any material fact required to be stated therein or
necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading, (B) of the
issuance by the Commission of any stop order suspending the
effectiveness of such registration statement or the initiation of
proceedings for that purpose, (C) of any request by the Commission for
(1) amendments to such registration statement or any document
incorporated or
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34
deemed to be incorporated by reference in any such registration
statement, (2) supplements to the prospectus forming a part of such
registration statement or (3) additional information, or (D) of the
receipt by the Company of any notification with respect to the
suspension of the qualification or exemption from qualification of any
of the Registrable Securities for sale in any jurisdiction or the
initiation of any proceeding for such purpose, and at the request of
any such Holder promptly prepare and furnish to it a reasonable number
of copies of a supplement to or an amendment of such prospectus as may
be necessary so that, as thereafter delivered to the purchasers of such
securities, such prospectus shall not include an untrue statement of a
material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein, in the light of
the circumstances under which they were made, not misleading;
(ix) use its reasonable best efforts to obtain the
withdrawal of any order suspending the effectiveness of any such
registration, or the lifting of any suspension of the qualification (or
exemption from qualification) of any of the Registrable Securities for
sale in any jurisdiction;
(x) if requested by any Initiating Holder or any
underwriter, promptly incorporate in such registration statement or
prospectus, pursuant to a supplement or post effective amendment if
necessary, such information as the Initiating Holder and any
underwriter may reasonably request to have included therein, including,
without limitation, information relating to the "plan of distribution"
of the Registrable Securities, information with respect to the
principal amount or number of shares of Registrable Securities being
sold to such underwriter, the purchase price being paid therefor and
any other terms of the offering of the Registrable Securities to be
sold in such offering and make all required filings of any such
prospectus supplement or post-effective amendment as soon as
practicable after the Company is notified of the matters to be
incorporated in such prospectus supplement or post effective amendment;
(xi) furnish to the Holders, addressed to them, an opinion
of counsel for the Company, dated the date of the closing under the
underwriting agreement, if any, or the date of effectiveness of the
registration statement if such registration is not an underwritten
offering, and use its reasonable best efforts to furnish to the
Holders, addressed to them, a "cold comfort" letter signed by the
independent certified public accountants who have certified the
Company's financial statements included in such registration, covering
substantially the same matters with respect to such registration (and
the prospectus included therein) and, in the case of such accountants'
letter, with respect to events subsequent to the date of such financial
statements, as are customarily covered in opinions of issuer's counsel
and in accountants' letters delivered to underwriters in underwritten
public offerings of securities and such other matters as the Holders
may reasonably request;
(xii) otherwise use its reasonable best efforts to comply
with all applicable rules and regulations of the Commission, and make
available to its security
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holders, as soon as reasonably practicable, an earnings statement
covering the period of at least 12 months, but not more than 18 months,
beginning with the first full calendar month after the effective date
of such registration statement, which earnings statement shall satisfy
the provisions of Section 11(a) of the Securities Act and Rule 158
promulgated thereunder;
(xiii) provide promptly to the Holders upon request any
document filed by the Company with the Commission pursuant to the
requirements of Section 13 and Section 15 of the Exchange Act;
(xiv) use its reasonable best efforts to cause all
Registrable Securities included in any registration pursuant hereto to
be listed on each securities exchange on which securities of the same
class are then listed, or, if not then listed on any securities
exchange, to be eligible for trading in any over-the-counter market or
trading system in which securities of the same class are then traded;
and
(xv) cause senior management reasonably to participate in
"roadshow" presentations and other customary marketing efforts.
(f) Indemnification.
(i) The Company will indemnify each of the
Holders, as applicable, each of its affiliates and its and any such affiliates'
respective officers, directors, members, partners and other representatives, and
each person controlling each of the Holders, with respect to each registration
which has been effected pursuant to this Section 3, and each underwriter, if
any, and each person who controls any underwriter, against all claims, losses,
damages and liabilities (or actions in respect thereof) arising out of or based
on any untrue statement (or alleged untrue statement) of a material fact
contained in any prospectus, offering circular or other document (including any
related registration statement, notification or the like) incident to any such
registration, qualification or compliance, or based on any omission (or alleged
omission) to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, or any violation by the
Company of the Securities Act or the Exchange Act or any rule or regulation
thereunder applicable to the Company and relating to action or inaction required
of the Company in connection with any such registration, qualification or
compliance, and will reimburse each such person, each such underwriter and each
person who controls any such underwriter, for any legal and any other expenses
reasonably incurred in connection with investigating and defending any such
claim, loss, damage, liability or action, provided that the Company will not be
liable in any such case if and to the extent that it is finally judicially
determined that any such claim, loss, damage, liability or expense primarily
arises out of or is based primarily on any untrue statement or omission based
upon written information furnished to the Company by the Holders or underwriter
and stated to be specifically for use therein. The indemnity agreement contained
in this paragraph shall not apply to the extent that any claims, losses, damages
or liabilities (or actions in respect thereof) result from the fact that a
current copy of the prospectus was not sent or given to a proposed
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36
transferee asserting any such claim, loss, damage, liability or action, at or
prior to the written confirmation of the sale of the Registrable Securities
concerned to such person if it is determined that the Company provided such
prospectus to such Holder in a timely manner prior to such sale and it was the
responsibility of the Holder under the Securities Act to provide the prospective
transferee with a current copy of the prospectus and such prospectus would have
cured the defect giving rise to such claim, loss, damage, liability or action.
(ii) Each of the Holders will, if Registrable
Securities held by it are included in the securities as to which such
registration, qualification or compliance is being effected, indemnify the
Company, each of its directors and officers and each underwriter, if any, of the
Company's securities covered by such a registration statement, each person who
controls the Company or such underwriter, each Other Stockholder and each of
their officers, directors, members and partners, and each person controlling
such Other Stockholder against all claims, losses, damages and liabilities (or
actions in respect thereof) arising out of or based on any untrue statement (or
alleged untrue statement) of a material fact contained in any such registration
statement, prospectus, offering circular or other document made by such Holder,
or any omission (or alleged omission) to state therein a material fact required
to be stated therein or necessary to make the statements by such Holder therein
not misleading, and will reimburse the Company and such Other Stockholders,
directors, officers, partners, members, persons, underwriters or control persons
for any legal or any other expenses reasonably incurred in connection with
investigating or defending any such claim, loss, damage, liability or action, in
each case if and to the extent, but only to the extent, that it is finally
judicially determined that such untrue statement (or alleged untrue statement)
or omission (or alleged omission) is made in such registration statement,
prospectus, offering circular or other document primarily in reliance upon and
in conformity with written information furnished to the Company by such Holder
and stated to be specifically for use therein ("Holder Information"); provided,
however, that the obligations of each of the Holders hereunder and under clause
(vi) below shall be limited to an amount equal to the net proceeds to such
Holder of securities sold as contemplated herein and no Holder will have any
liability hereunder except as to Holder Information about itself.
(iii) Each party entitled to indemnification under
this Section 3(f) (the "Indemnified Party") shall give notice to the party
required to provide indemnification (the "Indemnifying Party") promptly after
such Indemnified Party has actual knowledge of any claim as to which indemnity
may be sought, and shall permit the Indemnifying Party to assume the defense of
any such claim or any litigation resulting therefrom; provided that counsel for
the Indemnifying Party, who shall conduct the defense of such claim or any
litigation resulting therefrom, shall be approved by the Indemnified Party
(whose approval shall not unreasonably be withheld) and the Indemnified Party
may participate in such defense at such party's expense (unless the Indemnified
Party shall have reasonably concluded that there may be a conflict of interest
between the Indemnifying Party and the Indemnified Party in such action, in
which case the fees and expenses of one such counsel for all Indemnified Parties
shall be at the expense of the
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Indemnifying Party), and provided further that the failure of any Indemnified
Party to give notice as provided herein shall not relieve the Indemnifying Party
of its obligations under this Section 3 unless and only to the extent that the
Indemnifying Party is materially prejudiced thereby. No Indemnifying Party, in
the defense of any such claim or litigation shall, except with the consent of
each Indemnified Party (which consent shall not be unreasonably withheld or
delayed), consent to entry of any judgment or enter into any settlement which
does not include as an unconditional term thereof the giving by the claimant or
plaintiff to such Indemnified Party of a release from all liability in respect
to such claim or litigation. Each Indemnified Party shall furnish such
information regarding itself or the claim in question as an Indemnifying Party
may reasonably request in writing and as shall be reasonably required in
connection with the defense of such claim and litigation resulting therefrom.
(iv) If the indemnification provided for in this
Section 3(f) is held by a court of competent jurisdiction to be unavailable to
an Indemnified Party with respect to any loss, liability, claim, damage or
expense referred to herein, then the Indemnifying Party, in lieu of indemnifying
such Indemnified Party hereunder, shall contribute to the amount paid or payable
by such Indemnified Party as a result of such loss, liability, claim, damage or
expense in such proportion as is appropriate to reflect the relative fault of
the Indemnifying Party on the one hand and of the Indemnified Party on the other
in connection with the statements or omissions which resulted in such loss,
liability, claim, damage or expense, as well as any other relevant equitable
considerations. The relative fault of the Indemnifying Party and of the
Indemnified Party shall be determined by reference to, among other things,
whether the untrue (or alleged untrue) statement of a material fact or the
omission (or alleged omission) to state a material fact relates to information
supplied by the Indemnifying Party or by the Indemnified Party and the parties'
relative intent, knowledge, access to information and opportunity to correct or
prevent such statement or omission.
(v) Notwithstanding the foregoing, to the extent
that the provisions on indemnification and contribution contained in the
underwriting agreement entered into in connection with any underwritten public
offering contemplated by this Agreement are in conflict with the foregoing
provisions, the provisions in such underwriting agreement shall be controlling.
(vi) The foregoing indemnity agreement of the
Company and Holders is subject to the condition that, insofar as they relate to
any loss, claim, liability or damage made in a preliminary prospectus but
eliminated or remedied in the amended prospectus on file with the Commission at
the time the registration statement in question becomes effective or the amended
prospectus filed with the Commission pursuant to Commission Rule 424(b) (the
"Final Prospectus"), such indemnity or contribution agreement shall not inure to
the benefit of any underwriter or Holder (but only if such Holder was required
to deliver such Final Prospectus) if a copy of the Final Prospectus was
furnished to the underwriter and was not furnished to the person asserting the
loss, liability, claim or damage at or prior to the time such action is required
by the Securities Act.
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(g) Information by the Holders. Each of the Holders
holding securities included in any registration shall furnish to the Company
such information regarding such Holder and the distribution proposed by such
Holder as the Company may reasonably request in writing and as shall be
reasonably required in connection with any registration, qualification or
compliance referred to in this Section 3.
(h) Holdback Agreement; Postponement. Notwithstanding the
provisions of Sections 3(a), (b) and (c), if the Board of Directors of the
Company determines in good faith that it is in the best interests of the Company
(A) not to disclose the existence of facts surrounding any proposed or pending
acquisition, disposition, strategic alliance or financing transaction involving
the Company or (B) for any purpose, to suspend the registration rights set forth
herein, the Company may, by notice to the Holders in accordance with Section
6(a), postpone any registration which is requested pursuant to Section 3(a) or
3(c), for such a period of time as the Board of Directors may reasonably
determine; provided that (x) such periods of suspension together with any
periods of suspension effected pursuant to Section 3(a)(i)(B)(w) hereof may not
exceed 90 days in the aggregate during any period of 12 consecutive months and
(y) the Company may not impose such a suspension or a postponement pursuant to
Section 3(a)(i)(B)(w) following the printing and distribution of a preliminary
prospectus in any underwritten public offering of Registrable Securities
pursuant to Section 3(a)(i) (except such suspension, not to exceed ten days,
which results from an event that is not within the reasonable control of the
Company); provided, however, that the Company will not be entitled to postpone
or suspend the effectiveness of the BHA Resale Registration Statement (as may be
continued pursuant to Section 3(c)) unless the Board of Directors determines, in
the good faith exercise of its reasonable business judgment, after receiving the
advice of counsel to the Company, that such postponement or suspension is
required in order to avoid disclosure of information that would otherwise be
required by law to be disclosed during the effectiveness of such BHA Resale
Registration Statement, the premature disclosure of which would materially and
adversely affect the Company.
(i) Assignment. The registration rights set forth in
Section 3 hereof may be assigned, in whole or in part, to any transferee of
Registrable Securities (who shall be considered thereafter to be a Holder and
shall be bound by all obligations and limitations of this Agreement).
4. RULE 144 REPORTING
With a view to making available the benefits of certain rules and
regulations of the Commission which may permit the sale of restricted securities
to the public without registration, the Company agrees to:
(i) make and keep public information available (as those terms are
understood and defined in Rule 144) at all times;
15
39
(ii) use its reasonable best efforts to file with the Commission in
a timely manner all reports and other documents required of
the Company under the Securities Act and the Exchange Act; and
(iii) so long as there are outstanding any Registrable Securities,
furnish to each Holder, upon request, a written statement by
the Company as to its compliance with the reporting
requirements of Rule 144 and of the Securities Act and the
Exchange Act, a copy of the most recent annual or quarterly
report of the Company, and such other reports and documents so
filed as such Holder may reasonably request in availing itself
of any rule or regulation of the Commission allowing such
Holder to sell any such securities without registration.
5. INTERPRETATION OF THIS AGREEMENT
(a) Governing Law. This Agreement shall be governed by
and construed in accordance with the laws of the State of Georgia, without
giving effect to the principles of conflict of laws of such State.
(b) Section Headings. The headings of the sections and
subsections of this Agreement are inserted for convenience only and shall not be
deemed to constitute a part thereof.
6. MISCELLANEOUS
(a) Notices.
(i) All communications under this Agreement
shall be in writing and shall be delivered by facsimile or by hand or mailed by
overnight courier or by registered or certified mail, postage prepaid: .
(A) if to the Company, to
HeadHunter.NET, Inc., 333 Research Court, Suite 200, Norcross, Georgia 30092,
(770) 349-2401, Attention: Chief Executive Officer, or at such other address as
it may have furnished in writing to the Investors;
(B) if to the Investors, at the
addresses listed on Schedule I hereto, or at such other addresses as may have
been furnished the Company in writing.
(ii) Any notice so addressed shall be deemed to
be given: if delivered by hand, on the date of such delivery; if mailed by
courier, on the first business day following the date of such mailing; and if
mailed by registered or certified mail, on the third business day after the date
of such mailing.
(b) Reproduction of Documents. This Agreement and all
documents relating thereto, including, without limitation, any consents, waivers
and modifications which may hereafter be executed may be reproduced by the
Investor by any
16
40
photographic, photostatic, microfilm, microcard, miniature photographic or other
similar process and the Investors may destroy any original document so
reproduced. The parties hereto agree and stipulate that any such reproduction
shall be admissible in evidence as the original itself in any judicial or
administrative proceeding (whether or not the original is in existence and
whether or not such reproduction was made by the Investors in the regular course
of business) and that any enlargement, facsimile or further reproduction of such
reproduction shall likewise be admissible in evidence.
(c) Successors and Assigns. This Agreement shall inure to
the benefit of and be binding upon the successors and assigns of each of the
parties.
(d) Entire Agreement; Amendment and Waiver. This
Agreement constitutes the entire understanding of the parties hereto and
supersedes all prior understandings among such parties with respect to the
subject matter hereof, including the Prior Agreement. This Agreement may be
amended, and the observance of any term of this Agreement may be waived, with
(and only with) the written consent of the parties.
(e) Counterparts. This Agreement may be executed in one
or more counterparts, each of which shall be deemed an original and all of which
together shall be considered one and the same agreement.
(f) No Inconsistent Agreements. The Company will not
hereafter enter into any agreement with respect to its securities which is
inconsistent with the rights granted to the Holders of Registrable Securities in
this Agreement; provided, however, that upon the request of the Company in
connection with the issuance of securities by the Company after the date hereof
to raise equity or debt capital or acquire one or more businesses, the parties
will cause this Agreement to be amended to permit the purchasers of such
securities to have registration rights that are no more favorable in any
material respect to such purchasers than the rights of the Investors hereunder,
provided, however, that in no event will any party be required to agree to the
granting of any such rights that are superior in any material respect to its
rights hereunder without the prior written consent of that party (given or
withheld in its sole discretion).
(g) Remedies. Each Holder of Registrable Securities, in
addition to being entitled to exercise all rights granted by law, including
recovery of damages, will be entitled to specific performance of its rights
under this Agreement. The Company agrees that monetary damages would not be
adequate compensation for any loss incurred by reason of a breach by it of the
provisions of this Agreement and hereby agrees to waive the defense in any
action for specific performance that a remedy at law would be adequate.
(h) Severability. In the event that any one or more of
the provisions contained herein, or the application thereof in any
circumstances, is held invalid, illegal or unenforceable in any respect for any
reason, the validity, legality and enforceability of any such provision in every
other respect and of the remaining provisions contained herein shall not be in
any way impaired thereby, it being intended and understood that
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41
all of the rights and privileges of each of the Holders shall be enforceable to
the fullest extent permitted by law.
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42
IN WITNESS WHEREOF, the undersigned have executed this Amended and
Restated Registration Rights Agreement as of the date first set forth above.
HEADHUNTER.NET, INC.
By:
----------------------------------------
Chief Financial Officer
INVESTORS:
BERNARD HODES GROUP INC.
By:
----------------------------------------
Executive Vice President
OMNICOM FINANCE, INC.
By:
----------------------------------------
Treasurer
ITC HOLDING COMPANY, INC.
By:
----------------------------------------
Senior Vice President
19
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EXHIBIT B
AMENDED AND RESTATED SHAREHOLDERS' AGREEMENT
THIS AMENDED AND RESTATED SHAREHOLDERS' AGREEMENT (this "Agreement") is
made and entered into as of February 27, 2001, by and among HEADHUNTER.NET,
INC., a Georgia corporation (the "Company"), OMNICOM GROUP INC., a New York
corporation ("Omnicom"), BERNARD HODES GROUP INC., a Delaware corporation and
wholly owned subsidiary of Omnicom ("BHA"), OMNICOM FINANCE, INC., a Delaware
corporation and wholly owned subsidiary of Omnicom ("OFI"), and ITC HOLDING
COMPANY, INC., a Delaware corporation ("ITC") (Each of Omnicom, BHA, OFI and ITC
may be referred to individually as a "Shareholder" and collectively as
"Shareholders").
WHEREAS, the Company and certain of the Shareholders entered into a
Shareholders' Agreement, dated as of July 19, 2000 (the "Prior Agreement"), and
desire to amend and restate the Prior Agreement in its entirety as herein
provided.
NOW, THEREFORE, in consideration of the foregoing premises and for
other good and valuable consideration, the receipt and sufficiency of which is
acknowledged, the parties hereby agree as follows:
1. Definitions.
(a) "Affiliate" shall have the meaning assigned thereto
in Rule 405, as presently promulgated under the Securities Act.
(b) "beneficially owns" (or comparable variations
thereof) has the meaning set forth in Rule 13d-3 as presently promulgated under
the Exchange Act.
(c) "BHA Director" shall mean the person named as the BHA
Director in Section 3(b) hereof, as may be changed by BHA from time to time in
accordance with Section 3.
(d) "Company Common Stock" means the Company's common
stock, par value $0.01 per share.
(e) "Equity Securities" means Voting Securities,
Convertible Securities and Rights to Purchase Voting Securities.
(f) "Exchange Act" means the Securities Exchange Act of
1934, as amended, and the rules and regulations promulgated thereunder.
44
(g) "Finance Securities" means any shares of Company
Common Stock issued to OFI or any of its Affiliates pursuant to the Amended and
Restated Credit Agreement, dated the date hereof, between OFI and the Company.
(h) "Independent Slate" shall mean the three persons
named as members of the Independent Slate in Section 3(b) hereof, as may be
changed by mutual agreement of ITC and BHA from time to time in accordance with
Section 3(d) hereof.
(i) "ITC Slate" shall mean the two persons named as
members of the ITC Slate in Section 3(b) hereof, as may be changed by ITC from
time to time in accordance with Section 3.
(j) "Maximum Voting Percentage" shall mean 30% of the
Voting Power of the Company.
(k) "Person" means any individual, corporation,
partnership, trust, other entity or group (within the meaning of Section
13(d)(3) of the Exchange Act).
(l) "Restricted Group" means (i) any Shareholder, (ii)
any and all Persons directly or indirectly controlled by any Shareholder, (iii)
if such Shareholder is an individual, (a) any member of such Shareholder's
family (including any spouse, parent, sibling, child, grandchild or other lineal
descendant, including adoptive children), (b) the heirs, executors, personal
representatives and administrators of any of the foregoing Persons, (c) any
trust established for the benefit of any of the foregoing Persons and (d) any
charitable foundations established by any of the foregoing Persons, and (iv) any
and all groups (within the meaning of Section 13(d)(3) of the Exchange Act) of
which any Shareholder or any Person directly or indirectly controlled by such
Shareholder is a member, other than any such group not acting for the purpose of
acquiring, holding or beneficially owning Equity Securities.
(m) "Securities Act" means the Securities Act of 1933, as
amended, and the rules and regulations promulgated thereunder.
(n) "Standstill Period" means the period beginning on the
date of the Prior Agreement and ending on July 19, 2005.
(o) "Voting Power" means, with respect to any Outstanding
Voting Securities, the highest number of votes that the holders of all such
Outstanding Voting Securities would be entitled to cast for the election of
directors or on any other matter (except to the extent such voting rights are
dependent upon events or default or bankruptcy), assuming, for purposes of this
computation, the conversion or exchange into Voting Securities of Convertible
Securities (whether presently convertible or exchangeable or not) and the
exercise of Rights to
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45
Purchase Voting Securities (whether presently exercisable or not), in either
case to the extent that any such action would increase the number of such votes.
(p) "Voting Securities" means the Company Common Stock
and any other securities of the Company of any kind or class having power
generally to vote for the election of directors, including the Finance
Securities; "Convertible Securities" means securities of the Company which are
convertible or exchangeable (whether presently convertible or exchangeable or
not) into Voting Securities; "Rights to Purchase Voting Securities" means
options, warrants and rights issued by the Company (whether presently
exercisable or not) to purchase Voting Securities or Convertible Securities; and
"Outstanding Voting Securities" means at any time the then issued and
outstanding Voting Securities, Convertible Securities (which shall be counted at
the maximum number of Voting Securities for which they can be converted or
exchanged) and Rights to Purchase Voting Securities (which shall be counted at
the maximum number of Voting Securities for which they can be exercised).
2. Standstill Agreement. Each Restricted Group agrees, during the
Standstill Period, unless specifically invited in writing by the Board of
Directors of the Company, that such Restricted Group will not, either directly
or indirectly through a representative or otherwise, (a) effect or seek, offer
or propose (whether publicly or otherwise) to effect, or cause or participate in
or in any way assist any other person to effect or seek, offer or propose
(whether publicly or otherwise) to effect or participate in (i) any acquisition
of any securities (or beneficial ownership thereof) or assets of the Company or
any of its subsidiaries; (ii) any tender or exchange offer or merger or other
business combination involving the Company or any of its subsidiaries; (iii) any
recapitalization, restructuring, liquidation, dissolution or other extraordinary
transaction with respect to the Company or any of its subsidiaries; or (iv) any
"solicitation" of "proxies" (as such terms are used in the proxy rules of the
Exchange Act) or consents to vote any Voting Securities of the Company, (b)
form, join or in any way participate in a "group" (as defined under the Exchange
Act), (c) except by reason of an Affiliate serving on the Board of Directors of
the Company, otherwise act, alone or in concert with others, to seek to control
or influence the management, Board of Directors or policies of the Company, (d)
take any action which might force the Company to make a public announcement
regarding any of the types of matters set forth in (a) above, or (e) enter into
any discussions or arrangements with any third party with respect to any of the
foregoing. Each Restricted Group also agrees during any such period not to
request the Company (or its directors, officers, employees or agents), directly
or indirectly, to amend or waive any provision of this paragraph (including this
sentence); provided, however, that nothing in this Agreement will prohibit a
Restricted Group or member thereof from acquiring Finance Securities or making a
confidential proposal to the Board of Directors with respect to any of the
foregoing provided that the terms thereof are conditioned upon the maintenance
of such confidentiality by the Company.
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46
3. Voting.
(a) Until such time as a Restricted Group beneficially owns
Outstanding Voting Securities representing less than the lower of (1) 10% of the
Voting Power of all Outstanding Voting Securities or (2) 50% of the Voting Power
beneficially owned by such Restricted Group upon the consummation of the
transactions pursuant to which the Prior Agreement was entered into, at each
meeting of shareholders of the Company, each Restricted Group shall vote the
Voting Securities held by such Restricted Group (x) with respect to the election
of directors, in favor of the BHA Director and the persons named in the ITC
Slate and the Independent Slate, (y) on all proposals of any other shareholder
of the Company, in accordance with the recommendation of the Board of Directors
of the Company, and (z) on all other matters that shall come before the
shareholders of the Company for a vote, in its discretion up to the Maximum
Voting Percentage and, with respect to (A) any Voting Securities held in excess
of the Maximum Voting Percentage and (B) any Voting Securities that are Finance
Securities, in proportion to how all other Voting Securities which are not held
by such Restricted Group are voted.
(b) For purposes of this Section 3, until subsequently changed as
provided herein, the ITC Slate shall be Kimberley E. Thompson as a Class II
director and William H. Scott, III as a Class III director; the BHA Director
shall be an individual designated by BHA, who may be any officer or director of
BHA or Omnicom or any other person designated by BHA if such person is approved
by the Company (such approval no to be unreasonably withheld or delayed) as a
Class II director; and the Independent Slate shall be Robert M. Montgomery, Jr.
as a Class I director and Burton B. Goldstein, Jr. as a Class I director;
(c) Each of ITC and BHA may change the ITC Slate and the BHA
Director, respectively, by written notice to the Board of Directors of the
Company not later than the end of any fiscal year of the Company immediately
preceding the next annual meeting of shareholders at which such director to be
replaced would otherwise stand for election. ITC may change any member of the
Independent Slate by written notice to the Board of Directors of the Company not
later than the end of any fiscal year of the Company immediately preceding the
next annual meeting of shareholders at which such director to be replaced would
otherwise stand for election.
(d) In the event of any termination, death, disability, removal or
resignation of any director or in the event that either ITC elects to change a
member of its slate or BHA elects to change the BHA Director and, in either
case, causes its designee to resign as a director (a "Former Director"), such
vacancy shall be filled as follows: (i) If the Former Director is a member of
the ITC Slate or is the BHA Director, then ITC or BHA, as the case may be, shall
nominate a person to replace the Former Director (a "Replacement Director") in
writing to the Board of Directors; and (ii) if the Former Director is a member
of the
4
47
Independent Slate, then ITC shall nominate such Replacement Director to the
Board of Directors. If the Board of Directors shall fail to appoint any such
Replacement Director selected as set forth above to fill the unexpired term of a
Former Director, then such vacancy on the Board of Directors of the Company
shall remain until the next annual meeting of shareholders at which time such
Replacement Director shall be elected to the Board of Directors as a member of
the ITC Slate or the Independent Slate or as the BHA Director, as the case may
be.
(e) ITC's right to designate the members of the ITC Slate and the
Independent Slate in Sections 3(b) and 3(d) will terminate on the date the
Restricted Group that includes ITC beneficially owns Outstanding Voting
Securities representing less than the lower of (i) 10% of the Voting Power of
all Outstanding Voting Securities or (ii) 50% of the Voting Power beneficially
owned by such Restricted Group upon the consummation of the transactions
pursuant to which the Prior Agreement was entered into. BHA's right to designate
the BHA Director in Sections 3(b) and 3(d) will terminate on the date that
Restricted Group that includes BHA beneficially owns Outstanding Voting
Securities representing less than the lower of (i) 10% of the Voting Power of
all Outstanding Voting Securities or (ii) 50% of the Voting Power beneficially
owned by such Restricted Group on the date of the Prior Agreement.
4. Miscellaneous.
(a) Notices.
(i) All notices or other communications which are
required or permitted hereunder shall be in writing and sufficient if delivered
by hand, by facsimile transmission, by courier or overnight carrier or by
registered or certified mail, postage prepaid to the parties as follows:
(A) if to the Company, to HeadHunter.NET, Inc.,
333 Research Court, Suite 200, Atlanta, Georgia 30092, (770) 349-2401,
Attention: Chief Executive Officer, or at such other address as it may have
furnished in writing to the parties;
(B) if to the Shareholders, at the addresses
listed on Schedule I hereto, or at such other addresses as may have been
furnished the Company in writing.
(ii) Any notice shall be deemed to have been delivered as
of the date so delivered.
(b) Reproduction of Documents. This Agreement and all documents
relating thereto, including, without limitation, any consents, waivers and
modifications which may hereafter be executed may be reproduced by the parties
by any photographic, photostatic, microfilm, microcard, miniature
5
48
photographic or other similar process and the parties may destroy any original
document so reproduced. The parties hereto agree and stipulate that any such
reproduction shall be admissible in evidence as the original itself in any
judicial or administrative proceeding (whether or not the original is in
existence and whether or not such reproduction was made in the regular course of
business) and that any enlargement, facsimile or further reproduction of such
reproduction shall likewise be admissible in evidence.
(c) Successors and Assigns. This Agreement shall inure to the
benefit of and be binding upon the successors and assigns of each of the
parties. Section 3(a)(z) shall be binding on any transferee of Finance
Securities held by a member of a Restricted Group for so long as the Restricted
Group of which it is a member is subject to Section 3(a). Except for open-market
transactions with a Person who is not a member of the transferor's Restricted
Group effected through one or more brokers in the primary securities markets on
which the Company Common Stock is then traded, no transfer of Finance Securities
by a member of the Restricted Group shall be effective until the transferee
shall have entered into an agreement in the form of Exhibit A agreeing to be so
bound.
(d) Entire Agreement; Amendment and Waiver. This Agreement
constitutes the entire understanding of the parties hereto and supersedes all
prior understandings among such parties with respect to the subject matter
hereof, including the Prior Agreement. This Agreement may be amended, and the
observance of any term of this Agreement may be waived, with (and only with) the
written consent of the parties.
(e) Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original and all of which
together shall be considered one and the same agreement.
(f) Remedies. Each party, in addition to being entitled to
exercise all rights granted by law, including recovery of damages, will be
entitled to specific performance of its rights under this Agreement. Each party
agrees that monetary damages would not be adequate compensation for any loss
incurred by reason of a breach by it of the provisions of this Agreement and
hereby agrees to waive the defense in any action for specific performance that a
remedy at law would be adequate.
(h) Severability. In the event that any one or more of the
provisions contained herein, or the application thereof in any circumstances, is
held invalid, illegal or unenforceable in any respect for any reason, the
validity, legality and enforceability of any such provision in every other
respect and of the remaining provisions contained herein shall not be in any way
impaired thereby, it being intended and understood that all of the rights and
privileges of each party shall be enforceable to the fullest extent permitted by
law.
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49
IN WITNESS WHEREOF, the parties have executed this Amended and Restated
Shareholders' Agreement as of the date first set forth above.
HEADHUNTER.NET, INC.
By:
-----------------------------------------
Chief Financial Officer
OMNICOM GROUP INC.
By:
-----------------------------------------
Executive Vice President
BERNARD HODES GROUP INC.
By:
-----------------------------------------
Executive Vice President
ITC HOLDING COMPANY, INC.
By:
-----------------------------------------
Senior Vice President
OMNICOM FINANCE, INC.
By:
-----------------------------------------
Treasurer
7
50
EXHIBIT A
AGREEMENT
The undersigned, being a transferee of _______ shares of common stock of
HeadHunter.NET, Inc., hereby agrees to be bound by the provisions of Section
3(a)(z) of the Amended and Restated Shareholders Agreement, dated February 27,
2001, as if the undersigned were an original "Shareholder" under that Agreement.
Executed this ____ day of ________, 200__.
[TRANSFEREE NAME]
By:
---------------------------------
Name:
----------------------------
Title:
----------------------------
8
51
EXHIBIT C
HEADHUNTER.NET, INC.
333 RESEARCH COURT, SUITE 200
NORCROSS, GEORGIA 30092
February 27, 2001
American Stock Transfer & Trust Company
40 Wall Street
46th Floor
New York, New York 10005
Attention: Jennifer Donovan
Re: Amendment No. 1 to Shareholder Protection Rights Agreement
Ladies and Gentlemen:
Pursuant to Section 5.4 of the Shareholder Protection Rights
Agreement dated as of April 15, 2000 (the "Rights Agreement"), between
HeadHunter.NET, Inc. (the "Company") and American Stock Transfer & Trust
Company, as rights agent, the Company, by resolution adopted by its Directors,
hereby amends the Rights Agreement as follows:
1. The definition of "Acquiring Person" in Section 1.1 of the
Rights Agreement is hereby amended and restated in its entirety as follows:
""Acquiring Person" shall mean any Person who is a Beneficial
Owner of 15% or more of the outstanding shares of Common
Stock; provided, however, that the term "Acquiring Person"
shall not include any Person (i) who (x) is the Beneficial
Owner of 15% or more of the outstanding shares of Common Stock
on the date of this Agreement, or (y) shall become the
Beneficial Owner of 15% or more of the outstanding shares of
Common Stock solely as a result of an acquisition by the
Company of shares of Common Stock, or (z) shall become the
Beneficial Owner of 15% or more of the outstanding shares of
Common Stock on or after the date of this Agreement pursuant
to the Agreement and Plan of Merger, dated April 15, 2000, by
and among the Company, Resume Acquisition Corporation, Omnicom
Group Inc. ("OMC"), Bernard Hodes Group Inc. ("BHG"), Career
Mosaic Inc. and ITC Holding Company, Inc. or transferee
("ITC"), or pursuant to a transfer of such Common Stock to a
direct or indirect wholly owned Subsidiary of one or more such
persons, until such time hereafter or thereafter as such
Person or transferee shall become the Beneficial Owner (other
than by means of a stock dividend, stock split or other
similar event) of any additional shares of Common Stock,
except for additional shares of
52
American Stock Transfer & Trust Company
February 27, 2001
Page 2
Common Stock obtained upon the exercise of options granted to
directors of the Company and except for additional shares of
Common Stock obtained by OMC or any member of the OMC Group
(as defined below) pursuant to the Amended and Restated Credit
Agreement, dated February 27, 2001, between the Company and
Omnicom Finance, Inc. (the "OFI Credit Agreement"), (ii) who
is the Beneficial Owner of 15% or more of the outstanding
shares of Common Stock but who acquired Beneficial Ownership
of shares of Common Stock without any plan or intention to
seek or affect control of the Company, if such Person promptly
enters into an irrevocable commitment promptly to divest, and
thereafter promptly divests (without exercising or retaining
any power, including voting power, with respect to such
shares), sufficient shares of Common Stock (or securities
convertible into, exchangeable into or exercisable for Common
Stock) so that such Person ceases to be the Beneficial Owner
of 15% or more of the outstanding shares of Common Stock, or
(iii) Beneficially Owns shares of Common Stock consisting
solely of one or more of (A) shares of Common Stock
Beneficially Owned pursuant to the grant or exercise of an
option granted to such Person by the Company in connection
with an agreement to merge with, or acquire, the Company
entered into prior to a Flip-In Date, (B) shares of Common
Stock (or securities convertible into, exchangeable into or
exercisable for Common Stock), Beneficially Owned by such
Person or its Affiliates or Associates at the time of grant of
such option or (C) shares of Common Stock (or securities
convertible into, exchangeable into or exercisable for Common
Stock) acquired by Affiliates or Associates of such Person
after the time of such grant which, in the aggregate, amount
to less than 1% of the outstanding shares of Common Stock. In
addition, the Company, any wholly owned Subsidiary of the
Company and any employee stock ownership or other employee
benefit plan of the Company or a wholly owned Subsidiary of
the Company shall not be an Acquiring Person. Notwithstanding
any other provision hereof, in no event will ITC or OMC (OMC
and ITC, together with their successors or assigns (but only
such successors or assigns which control, are controlled by or
are under common control with OMC or ITC, as the case may be),
an "Authorized Holder"), individually or together with any
other Person in which Authorized Holder has, directly or
indirectly, an ownership interest (such other Persons,
"Related Companies"), or any Affiliate, Associate, director,
officer, employee, partner, member or other related Person of
Authorized Holder or a Related Company (collectively, a
"Related Person" and, together with Authorized Holder and
Related Companies, "OMC Group" or "ITC Group", as the case may
be), be deemed to be an "Acquiring Person" for purposes
hereof, nor shall a Flip-In Date, a Separation Time, a Stock
Acquisition Date or any other event hereunder occur as a
result of either OMC Group's or ITC Group's Beneficial
Ownership of Common Stock (any such event, an "OMC Triggering
Event" or an "ITC Triggering Event",
53
American Stock Transfer & Trust Company
February 27, 2001
Page 3
as the case may be) unless and until OMC or ITC shall have
received written notice from the Company that the Company's
Board of Directors has determined in good faith that the OMC
Group or the ITC Group constitutes an Acquiring Person
hereunder and, within 30 calendar days after receipt of notice
of such determination from the Company, the OMC Group or the
ITC Group, as the case may be, shall not have divested itself
of Common Stock or taken such other action as the Board of
Directors of the Company determines in good faith, after
consultation with counsel, is sufficient, so that either an
OMC Trigger Event or an ITC Trigger Event is no longer
continuing; provided, however, that if either the OMC Group or
the ITC Group shall become the Beneficial Owner of 50% or more
of the Common Stock, then an ITC Triggering Event or an OMC
Triggering Event shall occur in accordance with the terms of
this Agreement (disregarding the sentence of which this clause
is a part) and the foregoing provisions regarding notice and
opportunity to cure shall not apply. For the avoidance of
doubt, notwithstanding any other provision hereof, the right
to acquire Common Stock under the OFI Credit Agreement will
not be deemed to confer "Beneficial Ownership" until that
right has actually been exercised."
2. The Rights Agreement shall not otherwise be
supplemented or amended by virtue of this Amendment No. 1 to the Rights
Agreement, but shall remain in full force and effect.
3. Capitalized terms used without other definition in
this Amendment No. 1 to the Rights Agreement shall be used as defined in the
Rights Agreement.
4. This Amendment No. 1 to the Rights Agreement shall be
deemed to be a contract made under the internal substantive laws of the State of
Georgia and for all purposes shall be governed by and construed in accordance
with laws of such State applicable to contracts to be made and performed
entirely within such State.
5. This Amendment No. 1 to the Rights Agreement may be
executed in any number of counterparts and each of such counterparts shall for
all purposes be deemed to be an original, and all such counterparts shall
together constitute but one and the same instrument.
6. This Amendment No. 1 to the Rights Agreement shall be
effective as of the date hereof, and all references to the Rights Agreement
shall, from and after such time, be deemed to be references to the Rights
Agreement as amended hereby.
54
American Stock Transfer & Trust Company
February 27, 2001
Page 4
7. Exhibit A to the Rights Agreement shall be deemed
amended in a manner consistent with this Amendment No. 1 to the Rights
Agreement.
Very truly yours,
HEADHUNTER.NET, INC.
By:
---------------------------------
Name:
Title:
Accepted and agreed to as of the effective time specified above:
AMERICAN STOCK TRANSFER & TRUST
COMPANY
By:
-------------------------------
Name:
Title: