EXHIBIT 10.6
AMENDED AND RESTATED
STANDSTILL AGREEMENT
THIS AMENDED AND RESTATED STANDSTILL AGREEMENT (this "Agreement"),
dated as of August 21, 2002, is by and among PRG-SCHULTZ INTERNATIONAL, INC., a
Georgia corporation (the "Company"), and each of the other parties identified
on the signature pages hereto (collectively, the "Investors").
W I T N E S S E T H:
WHEREAS, the Investors are the Beneficial Owners of shares of the
Common Stock of the Company and desire to acquire additional shares of such
Common Stock; and
WHEREAS, the Company has adopted that certain Shareholder Protection
Rights Agreement (the "Rights Agreement") dated as of August 9, 2000, as
amended effective on May 15, 2002, between the Company and First Union National
Bank, as Rights Agent; and
WHEREAS, in order to induce the Company's Board of Directors to act to
amend the Rights Agreement to exclude, in certain circumstances, the Investors
from the definition of "Acquiring Person" under clause (iii) of such definition
appearing in the Rights Agreement, the Investors entered into a Standstill
Agreement with the Company as of August 16, 2002 (the "Standstill Agreement").
WHEREAS, the parties to the Standstill Agreement have agreed to enter
into this Amended and Restated Standstill Agreement to correct and clarify
certain provisions thereof and intend that this Agreement supersede the
Standstill Agreement in its entirety.
NOW, THEREFORE, in consideration of the mutual covenants and
agreements contained herein, the parties hereto agree as follows:
1. Definitions. Capitalized terms used in this Agreement which
are not otherwise defined by this Agreement are used with the same meaning
ascribed to such terms in the Rights Agreement. In addition, unless the context
otherwise requires, the following terms shall have the following meanings for
purposes of this Agreement:
(a) "13D Group" means any "group" (within the meaning of
Section 13(d) of the Exchange Act) formed for the purpose of acquiring,
holding, voting or disposing of Voting Stock of Company.
(b) "Acquisition Proposal" shall mean a bona fide,
written proposal which includes all material terms of a proposed transaction
received by the Board of Directors of the Company from any Person proposing to
enter into a transaction which, if consummated, would constitute a Change of
Control of the Company.
(c) "Change of Control" shall mean (i) the acquisition
by a Third Party of more than 50% of the Company's then outstanding Voting
Stock, excluding however, a purchase
agreement with an underwriter or group of underwriters in a registered public
offering to the public; (ii) the consummation of a merger, acquisition,
consolidation or reorganization or series of such related transactions
involving the Company, unless immediately after such transaction or
transactions, the shareholders of the Company immediately prior to such
transaction shall Beneficially Own at least 50% of the outstanding Voting Stock
of the Company (or, if the Company shall not be the surviving company in such
merger, consolidation or reorganization, the Voting Stock of the surviving
corporation issued in such transaction or transactions in respect of Voting
Stock of the Company shall represent at least 50% of the Voting Stock of such
surviving corporation); (iii) a change or changes in the membership of the
Company's Board of Directors which represents a change of a majority of such
membership during any twelve-month period (unless such change or changes in
membership are caused by the actions of the then-existing Board of Directors);
or (iv) the consummation of a sale of all or substantially all of the Company's
assets unless immediately after such transaction, the shareholders of the
Company immediately prior to such transaction shall Beneficially Own at least
50% of the Voting Stock of the acquiring company.
(d) "Common Stock" shall mean the common stock, no par
value per share, of the Company.
(e) "Controlled Affiliate" shall mean any Investor or
any Person that is directly or indirectly, controlling, controlled by or under
common interest with any Investor.
(f) "Exchange Act" shall mean the Securities Exchange
Act of 1934, as amended.
(g) "Investor Tender Offer" shall mean a bona fide
public tender offer subject to the provisions of Regulation 14D under the
Exchange Act, by an Investor (or any 13D Group that includes an Investor) to
purchase or exchange for cash or other consideration all of the outstanding
shares of Common Stock (other than Common Stock owned by the Investors or their
Controlled Affiliates) and which has a minimum condition of such number of
shares of Common Stock that would result in the Investors or their Controlled
Affiliates Beneficially Owning not less than 51% of the shares of outstanding
Common Stock on a fully-diluted basis (including all shares of Common Stock
issuable upon exercise of any option, warrant, conversion right or other right
to acquire Common Stock, whether or not then exercisable).
(h) Proprietary Information" shall mean all confidential
information of the Company other than information that (i) is or becomes
publicly available other than as a result of a breach by an Investor of its
obligations hereunder or under the Confidentiality Agreement referenced in
Section 7 below, (ii) is or becomes available to an Investor on a
nonconfidential basis from a source that is, to the Investor's knowledge, not
prohibited from disclosing such information, (iii) is known to an Investor
prior to disclosure by the Company, or (iv) has been independently developed by
an Investor without reference to confidential information of the Company.
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(i) "Registration Rights Agreement" shall mean the
Registration Rights Agreement in the form of Annex "A" hereto between the
Company and the Investors, as it may be amended, supplemented or otherwise
modified from time to time.
(j) "Securities Act" shall mean the Securities Act of
1933, as amended, and the rules and regulations promulgated thereunder.
(k) "Stock Purchase Agreements" shall mean that certain
Stock Purchase Agreement of even date herewith among Blum Strategic Partners
II, L.P. and certain others, and any document contemplated therein.
(l) "Third Party" shall mean any Person other than any
Investor or any Affiliate or Associate of an Investor.
(m) "Third Party Tender Offer" shall mean a bona fide
public offer subject to the provisions of Regulation 14D under the Exchange
Act, by a Person (which is not made by and does not include any of the
Investors or their Controlled Affiliates or any 13D Group that includes the
Investors or their Controlled Affiliates) to purchase or exchange for cash or
other consideration any Voting Stock of the Company and which consists of an
offer to acquire 30% or more of the then Total Current Voting Power of the
Company, as the case may be.
(n) "Total Current Voting Power" shall mean, with
respect to any corporation, the total number of votes that may be cast in the
election of members of the board of directors of the corporation if all
securities entitled to vote in the election of such directors (excluding shares
of preferred stock that are entitled to elect directors only upon the
occurrence of customary events of default) are present and voted.
(o) "Voting Stock" of any Person shall mean any
securities entitled to vote generally in the election of directors of such
Person, or any direct or indirect rights or options or warrants to acquire any
such securities or any securities convertible or exercisable into or
exchangeable for such securities, including without limitation, the Company's
currently outstanding convertible notes, whether or not such securities are so
convertible, exercisable or exchangeable at the time of determination.
2. Amendment to Rights Plan. With the goal of ensuring that
Investors shall not be deemed to be an Acquiring Person for so long as they
have not breached any of the representations, warranties or covenants contained
in this Agreement, concurrently herewith the Company's Board of Directors has
amended the Rights Plan to provide that the Investors shall not be deemed an
Acquiring Person thereunder for so long as this Agreement is in effect and so
long as the Investors have increased their beneficial ownership of Common Stock
above that shown in the Investors' amendment to Schedule 13D filed with the SEC
on June 17, 2002 by no more than 5,784,675 shares in the aggregate (without
giving effect to any stock split, share dividend, recapitalization,
reclassification or similar transactions effected by or with the approval of
the Board of Directors of the Company after the date hereof) (the "Limit");
provided, however, that the Limit shall be reduced, on a share for share basis,
by any shares sold or otherwise disposed of by any Investor otherwise than to
another Investor and by that number of shares that are acquired
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by the Company pursuant to that certain Second Option Agreement to be entered
into between Schultz PRG Liquidating Investments Ltd. and the Company in the
Form of Annex B hereto (the "Option Agreement"); provided, further, however,
that the amendment to the Rights Plan provides that any termination of this
Agreement by the Company or delivery of any notice of termination by Investors,
in each case pursuant to Section 17 hereof, shall rescind the amendment and
cause the Investors' full beneficial ownership of Common Stock to be considered
for purposes of determining whether or not Investors are an Acquiring Person;
provided, further, however, that the Investors shall not be deemed to
beneficially own any shares of Company Common Stock owned by any other persons
that are not Controlled Affiliates, solely by reason of any Investor and such
other persons (or their permitted assigns) entering into the Stock Purchase
Agreements (or any similar stock purchase agreement entered into by such other
person (or its permitted assigns) on or about the date hereof) or by reason of
the performance of such Investor's and any other persons' (or their permitted
assigns') obligations thereunder.
3. Representations and Warranties by Investors. Each of the
Investors hereby severally represents and warrants to the Company as follows:
(a) Such Investor has all requisite corporate and other
power and authority (if applicable) to execute, deliver and perform their
respective obligations under this Agreement. The execution, delivery and
performance of this Agreement by such Investor and the consummation of the
transactions contemplated hereby have been duly authorized by all requisite
corporate and other action (if applicable) on the part of such Investor.
(b) This Agreement has been duly executed and delivered
by such Investor and constitutes a legal, valid and binding obligation of such
Investor, enforceable against such Investor in accordance with its terms,
except to the extent that enforceability may be limited by bankruptcy,
insolvency or other similar laws affecting creditors rights generally or by
general principles of equity.
(c) No governmental consent, approval, authorization,
license or clearance, or filing or registration with any governmental or
regulatory authority, is required in order to permit such Investor to perform
its respective obligations under this Agreement, except for such as have been
obtained.
(d) The shares of Common Stock set forth on Schedule 1
attached hereto represent all of the shares of capital stock of the Company, if
any, which are Beneficially Owned by such Investor on the date hereof. Such
shares are owned free and clear of any charge, claim, equitable interest, lien,
option, pledge, security interest, right of first refusal, encumbrance or
similar restriction. Such Investor does not have the right to vote shares of
capital stock of the Company other than those set forth on Schedule 1 with
respect to such Investor, and such Investor has not granted any other Person
the right to vote such shares.
4. Representations and Warranties of the Company. The Company
represents and warrants to the Investors as follows:
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(a) The Company has all requisite corporate power and
authority to execute, deliver and perform its obligations under this Agreement.
The execution, delivery and performance of this Agreement by the Company and
the consummation of the transactions contemplated hereby have been duly
authorized by all requisite corporate action on the part of the Company.
(b) This Agreement has been duly executed and delivered
by the Company and constitutes a legal, valid and binding obligation of the
Company, enforceable against the Company in accordance with its terms, except
to the extent that enforceability may be limited by bankruptcy, insolvency or
similar laws affecting creditors rights generally or by general principles of
equity.
(c) No governmental consent, approval, authorization,
license or clearance, or filing or registration with any governmental or
regulatory authority, is required in order to permit the Company to perform its
obligations under this Agreement, except for such as have been obtained.
5. Standstill Provisions. Each of the Investors hereby severally
agrees that neither it nor any Controlled Affiliate of such Investor will
singularly or together with any other Person directly or indirectly, in each
case unless specifically requested to do so in writing in advance by the Board
of Directors of the Company:
(a) Acquire or offer, make a proposal or agree to
acquire (whether publicly or otherwise) in any manner, any material assets of
the Company or its subsidiaries or any Voting Stock of the Company or its
subsidiaries (or Beneficial Ownership thereof), in addition to the Voting Stock
currently owned by such Investor as set forth in Schedule 1 hereof, except (i)
not more than an additional 5,784,675 shares of Common Stock which may be
acquired after the date hereof by all of the Investors, in the aggregate, which
number shall be reduced on a share for share basis by any shares of Common
Stock sold or otherwise disposed of by any Investor and by that number of
shares that are acquired by the Company pursuant to the Option Agreement, or
(ii) securities acquired pursuant to a stock split, share dividend,
recapitalization, reclassification or similar transaction effected by or with
the approval of the Board of Directors of the Company; provided that the
execution by any Investor of the Stock Purchase Agreements and the performance
by such Investor of its obligations thereunder shall not violate this
subparagraph (a).
(b) Make or in any way propose or participate in any
"solicitation" of "proxies" to vote (as such terms are defined in Rule 14a-1 of
the Exchange Act), solicit any consent, or communicate with in any material
respect, or seek to advise or influence any Person (other than the Investors
and their Controlled Affiliates) with respect to the solicitation or voting of
any Voting Stock of the Company in opposition to any matter that has been
recommended by the Board of Directors of the Company or in favor of any matter
that has not been approved by the Board of Directors of the Company, or become
a "participant" (as defined in Instruction 3 to Item 4 of Rule 14a-101 under
the Exchange Act) in any contested election of directors of the Company, or
threaten or propose to do the same or publicly announce an intention to do the
same.
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(c) Form, or be a member of, join or encourage the
formation of any Person (other than the group consisting solely of the
Investors and their Controlled Affiliates) with respect to any Voting Stock of
the Company or the acquisition of any assets of the Company or any of its
subsidiaries; provided that the execution by any Investor of the Stock Purchase
Agreements and the performance by such Investor of its obligations thereunder
shall not violate this subparagraph (c).
(d) Deposit any Voting Stock of the Company into a
voting trust or subject any Voting Stock to an arrangement or agreement with
respect to the voting thereof (other than this Agreement or an arrangement
solely concerning the Investors and their Controlled Affiliates).
(e) Seek election to or seek to place a representative
on the Board of Directors of the Company or seek the removal of any member of
the Board of Directors of the Company except as provided in that certain
Investor Rights Agreement to be entered into among the Company and the
investors named therein in the form of Annex C hereto.
(f) Call or seek to have called any meeting of the
shareholders of the Company other than through participation as a director of
the Company and with the prior approval of the Board.
(g) Initiate, propose or otherwise solicit shareholders
of the Company for the approval of any shareholder proposal with respect to the
Company as described in Rule 14a-8 under the Exchange Act, or induce or attempt
to induce any Person to initiate any such shareholder proposal, in opposition
to any matter that has been recommended by the Board or in favor of any matter
that has not been approved by the Board.
(h) Without the prior written permission of the Board of
Directors of the Company, solicit, seek to effect, negotiate with or provide
any non-public information to any Person with respect to, or make any statement
or proposal, whether written or oral, or otherwise make any public announcement
or proposal whatsoever with respect to (i) a merger or acquisition of the
Company or any other business combination involving the Company, (ii) the sale
of all or a substantial portion of the assets of the Company and its
subsidiaries, (iii) the purchase of equity securities of the Company (except as
permitted in Section 5(a)) or any of its subsidiaries, whether by tender offer,
exchange offer or otherwise, (iv) the liquidation of the Company, (v) the
recapitalization of the Company, (vi) any other extraordinary business
transaction with respect to the Company, or (vii) any other matter involving
the Company, or take any action which might require or result in a public
announcement by or with respect to the Company or with respect to any such
matters (except that the foregoing shall not restrict communications among the
Investors and their Controlled Affiliates).
(i) Instigate or assist, or enter into any arrangements
with, any Third Party to do any of the actions described in this Section 5.
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(j) Transfer any securities of the Company to any Person
that would be required, as a result of such transfer, to file or amend a
Schedule 13D or 13G; provided that the limitation contained in this clause (j)
shall not apply to transfers (i) to or among the Investors and any of their
Controlled Affiliates who are or agree to become bound by this Agreement, (ii)
that have been consented to in writing by the Company in advance and without
any violation of any provisions of this Section 5 by any Investors or
Controlled Affiliates, (iii) pursuant to a Third Party Tender Offer that is
recommended by the Board of Directors of the Company, (iv) pursuant to a
merger, consolidation or reorganization to which the Company is a party, (v) in
a bona fide underwritten public offering conducted in connection with rights
exercised under the Registration Rights Agreement, provided that in no event
may any shares acquired pursuant to the Stock Purchase Agreements be
transferred pursuant to this clause (v) prior to January 24, 2004; (vi)
pursuant to transfers to withdrawing limited partners or managed accounts;
provided that such limited partners or managed accounts are not a part of the
Investors' 13D Group (unless they are Investors or Controlled Affiliates) and
do not become a part of such 13D Group immediately following the transfer;
(vii) pursuant to public sales in the open market in compliance with the volume
and manner of sale requirements of Rule Rule 144(e) and (f) under the
Securities Act; (viii) of up to 9.9% of the Company's outstanding voting
securities, provided that the purchaser does not beneficially own 10% or more
of the voting power of the Company's outstanding securities immediately
subsequent to the transfer; (ix) pursuant to that certain Purchase Agreement in
the form attached as Annex D hereto (the "Investor Purchase Agreement"); or (x)
pursuant to a Third Party Tender Offer that is not recommended by the Board of
Directors of the Company; provided that only a number of shares that is equal
to or less than 15% of the Company's outstanding Common Stock as of the record
date for the Third Party Tender Offer may be tendered by all Investors, in the
aggregate, and if 50% or less of the Company's outstanding voting securities,
on a fully diluted basis, are a acquired pursuant to the Third Party Tender
Offer, the remaining shares of Common Stock held by the Investors may not be
tendered in the Third Party Tender Offer or otherwise transferred to any party
participating in the Third Party Tender Offer for one year following such
tender, regardless of whether or not this Agreement has been terminated under
Section 17.
(k) At any time prior to January 24, 2004, sell, gift,
transfer or otherwise dispose of to any Person, or enter into any collar, swap,
prepaid forward, other hedging transaction that would reduce the risk of
ownership of, any securities of the Company acquired pursuant to the Stock
Purchase Agreements, regardless of whether or not any such Person, as a result
of thereof, is required to file or amend a Schedule 13D or 13G; provided,
however, that the limitation contained in this clause (k) shall not apply to
transfers (i) to or among the Investors and any of their Controlled Affiliates
who are or agree to become bound by this Agreement, (ii) that have been
consented to in writing by the Company in advance and without any violation of
any provisions of this Section 5 by any Investors or Controlled Affiliates,
(iii) pursuant to a Third Party Tender Offer that is recommended by the Board
of Directors of the Company, (iv) pursuant to a merger, consolidation or
reorganization to which the Company is a party; (v) pursuant to the Investor
Purchase Agreement; (vi) to one non-affiliate of the Investors, in an aggregate
amount not to exceed 45,872 shares of Common Stock, or (vii) pursuant to the
Option Agreement and the related Secured Promissory Note and Pledge Agreement
between Schultz PRG Liquidating Investments Ltd. and Blum Strategic Partners
II, L.P.
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(l) Voluntarily take any actions, other than execution
of the Stock Purchase Agreements and performance of such Investor's obligations
thereunder, that would cause the Investors to be members of the same 13D Group
as any other persons (or their permitted assigns) entering into the Stock
Purchase Agreements (or any similar stock purchase agreement entered into by
such other person (or its permitted assigns).
(m) Request the Company or its Board of Directors,
directly or indirectly, to amend or waive any provision of this Section 5.
Anything in this Section 5 to the contrary notwithstanding, this Section 5
shall not prohibit or restrict (i) any Investor affiliate serving as a director
of the Company from acting in compliance with his fiduciary duties to the
Company in such capacity, and (ii) any disclosure pursuant to Section 13(d) of
the Exchange Act which an Investor reasonably believes, based on the advise of
outside counsel, is required in connection with any action taken by such
Investor that is otherwise in compliance with this agreement.
6. Voting. Notwithstanding anything in this Agreement to the
contrary, the Investors collectively shall vote any and all shares owned by
them (whether of record, in street name, through a nominee or otherwise) as
follows: (a) any and all shares so owned by Investors in the aggregate that
exceed 15% of the outstanding shares of Common Stock of the Company on the
record date for such vote shall be voted consistently with the recommendations
of the Company's Board of Directors on all matters placed before the Company's
shareholders, whether at a special or annual meeting, by written consent, or
otherwise, and (b) all other shares so owned by the Investors may be voted in
their discretion. The general counsel of Blum Strategic Partners II, L.P. shall
provide a certification as to compliance with Subsection (a) of this Section 6
at least one week prior to any special or annual meeting of the Company's
shareholders.
7. Suspension of Restrictions. The limitations provided in
Section 5 shall immediately be suspended upon the earliest occurrence of any of
the following events:
(a) The occurrence of a "Change of Control" of the
Company.
(b) The public announcement by the Company that it is
for sale.
(c) The execution of a definitive agreement by the
Company which, if consummated, would result in a Change of Control of the
Company.
(d) The adoption by the Board of Directors of a plan of
complete liquidation or dissolution.
To the extent a widely disseminated public announcement thereof has not already
been made, the Company shall provide the Investors with prompt written notice
of the occurrence of any of the events set forth in this Section. Upon any (i)
public withdrawal of any "for sale" notice referred to in Section 7(b), (ii)
termination of any agreement referred to in Section 7(c) without
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consummation thereof, (iii) termination of the plan of liquidation referenced
in Section 7(d), as the case may be, the limitations provided in this Agreement
(except to the extent then suspended as a result of any other event specified
in this Section) shall again be applicable to the extent provided herein;
provided, however, that, in the case of clauses (i) (ii) or (iii) above, prior
to such public withdrawal, agreement termination or plan termination, as the
case may be, (A) the Investors and their Controlled Affiliates have not
acquired actual ownership of Voting Stock of the Company representing in the
aggregate a majority of the Total Current Voting Power of the Company and (B)
no Investor or its Controlled Affiliate has commenced a Investor Tender Offer.
8. Confidentiality.
(a) Each Investor agrees that the Confidentiality and
Non-Disclosure Agreement between Blum Strategic GP II, L.L.C. and the Company
(the "Confidentiality Agreement") remains in full force and effect and shall
bind each Investor to the same extent as it binds Blum Strategic GP II, L.L.C.
9. Enforcement. Each of the Investors, on the one hand, and the
Company, on the other, acknowledge and agree that irreparable damage would
occur if any of the provisions of this Agreement were not performed in
accordance with their specific terms or were otherwise breached. Accordingly,
the parties will be entitled to an injunction or injunctions to prevent
breaches of this Agreement and to enforce specifically its provisions in any
court having jurisdiction, this being in addition to any other remedy to which
they may be entitled at law or in equity.
10. Entire Agreement;Waivers. This Agreement, the Confidentiality
Agreement, and that certain letter of even date herewith from the Company to
the Investors, constitute the entire agreement among the parties hereto
pertaining to the subject matter hereof and thereof and supersede all prior and
contemporaneous agreements, understandings, negotiations and discussions,
whether oral or written, of the parties with respect to such subject matter. No
waiver of any provision of this Agreement shall be deemed or shall constitute a
waiver of any other provision hereof or thereof (whether or not similar), shall
constitute a continuing waiver unless otherwise expressly provided nor shall be
effective unless in writing and executed (i) in the case of a waiver by the
Company, by the Company and (ii) in the case of a waiver by the Investors, by
the Investors against which enforcement of such waiver is sought.
11. Amendment or Modification. The parties hereto may not amend
or modify this Agreement except in such manner as may be agreed upon by a
written instrument executed by the Company and the Investors against which
enforcement of such amendment is sought.
12. Successors and Assigns. All the terms and provisions of this
Agreement shall be binding upon and shall inure to the benefit of the parties
hereto and their respective successors, and each successor shall be deemed to
be a party hereto for all purposes hereof. The terms and provisions of this
Agreement shall not be binding upon any transferee (other than an Investor or a
Controlled Affiliate of an Investor) that purchases any securities subject to
this Agreement without violation of any provision of this Agreement. An
Investor may not assign or transfer any
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of its rights or obligations hereunder (whether to a transferee of shares of
Common Stock or otherwise) without the prior written consent of the Company,
and no transfer or assignment by any party shall relieve such party of any of
its obligations hereunder.
13. Severability. If any provision of this Agreement is held by a
court of competent jurisdiction to be unenforceable, the remaining provisions
shall remain in full force and effect. It is declared to be the intention of
the parties that they would have executed the remaining provisions without
including any that may be declared unenforceable.
14. Headings. Descriptive headings are for convenience only and
will not control or affect the meaning or construction of any provision of this
Agreement.
15. Counterparts. For the convenience of the parties, any number
of counterparts of this Agreement may be executed by the parties, and each such
executed counterpart will be an original instrument.
16. Notices. Any notices or other communications required or
permitted hereunder shall be sufficiently given if in writing (including
telecopy or similar teletransmission), addressed as follows:
If to the Company, to:
PRG-Schultz International, Inc.
2300 Windy Ridge Parkway
Suite 100 North
Atlanta, Georgia 30189
Attention: Clint McKellar, Jr.
Telephone No.: (770) 779-3051
Facsimile No.: (770) 779-3034
with a copy to:
Arnall Golden Gregory LLP
2800 One Atlantic Center
1201 West Peachtree Street
Atlanta, Georgia 30309-3450
Attention: Jonathan Golden, Esq.
Telephone No.: (404) 873-8700
Facsimile No.: (404) 873-8701
If to the Investors, to:
Blum Capital Partners, L.P.
909 Montgomery Street
Suite 400
San Francisco, California 94113
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Attention: Murray A. Indick
Facsimile No.: (415) 434-3130
with a copy to:
Simpson Thacher & Bartlett
3330 Hillview Avenue
Palo Alto, CA 94304
Attention: Michael Nooney
Telephone No.: (650) 251-5070
Facsimile No.: (650) 251-5002
Unless otherwise specified herein, such notices or other communications shall
be deemed received (a) in the case of any notice or communication sent other
than by mail, on the date actually delivered to such address (evidenced, in the
case of delivery by overnight courier, by confirmation of delivery from the
overnight courier service making such delivery, and in the case of a telecopy,
by receipt of a transmission confirmation form or the addressee's confirmation
of receipt), or (b) in the case of any notice or communication sent by mail,
three business days after being sent, if sent by registered or certified mail,
with first-class postage prepaid. Each of the parties hereto shall be entitled
to specify a different address by giving notice as aforesaid to each of the
other parties hereto.
17. Termination. This Agreement shall remain in full force and
effect until terminated in accordance with this Section. Subject to Section
5(j)(x) hereof, this Agreement may be terminated by 2/3's of the Investors, at
any time the Investors' aggregate Beneficial Ownership of Common Stock is below
15%, by giving 30 days' advance written notice to the Company. Except as set
forth in the following two sentences, all of the provisions of this Agreement
shall remain in full force and effect for 30 days following receipt of such
notice by the Company, regardless of whether or not Investors shall thereafter
become an Acquiring Person pursuant to the Rights Agreement during such 30 day
period. Sections 5(a) and 5(k) shall terminate upon the Company's receipt of
such notice; provided, however, that in no event shall Section 5(k) terminate
prior to January 24, 2004. Section 5(j) shall terminate upon the Company's
receipt of such notice except for the proviso to Section 5(j)(x), which shall
remain in full force and effect in accordance with its terms. This Agreement
may be immediately terminated by the Company by written notice to Investors
following any material breach by any Investor of any provision hereof,
including without limitation any breach of Section 5 hereof. Such termination
will immediately terminate all provisions of this Agreement except for Section
5(k) and the proviso to Section 5(j)(x), which shall remain in effect in
accordance with their terms.
18. Governing Law. This Agreement shall be governed by and
construed in accordance with the domestic substantive law of the State of
Delaware, without giving effect to any choice or conflict of law provision or
rule that would cause the application of the law of any other jurisdiction.
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19. Non-Exclusive Submission to Jurisdiction. Any disputes
arising out of or in connection with this Agreement may be adjudicated in the
United States District Court for the Northern District of Georgia or in a court
of competent civil jurisdiction in the State of Georgia. Each party hereto
irrevocably submits to the personal jurisdiction of such courts for the
purposes of any such suit, action, counterclaim or proceeding arising out of
this Agreement (collectively, a "Suit"). Each of the parties hereto hereby
waives and agrees not to assert by way of motion, as a defense or otherwise in
any such Suit, any claim that it is not subject to jurisdiction of the above
courts, that such Suit is brought in an inconvenient forum, or the venue of
such Suit is improper; provided, however, that nothing herein shall be
construed as a waiver of any right that any party hereto may have to remove a
Suit from a court sitting in the State of Georgia to the United States District
for the Northern District of Georgia. Each of parties hereby agrees that
service of all writs, process and summonses in any Suit may be made upon such
party by mail to the address as provided in this Agreement. Nothing herein
shall anyway be deemed to limit the ability of any party to serve any such
writs, process or summonses in any other matter permitted by applicable law.
20. To the extent that any provision of the Standstill Agreement
dated as of August 16, 2002 among the parties hereto conflicts with or is
contrary to the provisions of this Amended and Restated Standstill Agreement,
the provisions hereof shall control.
IN WITNESS WHEREOF, the Company and the Investors have caused this
Agreement to be executed as of the date first above written by their respective
duly authorized representatives.
The Company: PRG-SCHULTZ INTERNATIONAL, INC.
By: /s/ Clinton McKellar, Jr.
------------------------------------
Name: Clinton McKellar, Jr.
----------------------------------
Title: General Counsel and Secretary
---------------------------------
[SIGNATURES CONTINUED ON FOLLOWING PAGE]
12
BLUM CAPITAL PARTNERS, L.P.
By: Richard C. Blum & Associates, Inc., its
general partner
By: /s/ Murray A. Indick
---------------------------------------------
Murray A. Indick, Partner, General Counsel
and Secretary
RICHARD C. BLUM & ASSOCIATES, INC.
By: /s/ Murray A. Indick
---------------------------------------------
Murray A. Indick, Partner, General Counsel
and Secretary
BLUM STRATEGIC GP, L.L.C.
By: /s/ Murray A. Indick
---------------------------------------------
Murray A. Indick, Member
BLUM STRATEGIC GP II, L.L.C.
By: /s/ Murray A. Indick
---------------------------------------------
Murray A. Indick, Member
13
BLUM STRATEGIC PARTNERS, L.P.
By: BLUM STRATEGIC GP, L.L.C.
By: /s/ Murray A. Indick
---------------------------------------------
Murray A. Indick, Member
BLUM STRATEGIC PARTNERS II, L.P.
By: BLUM STRATEGIC GP II, LLC,
Its General Partner
By: /s/ Murray A. Indick
---------------------------------------------
Murray A. Indick, Member
RICHARD C. BLUM
/s/ Murray A. Indick
---------------------------------------------------
Murray A. Indick, Attorney-in-Fact
THE COMMON FUND FOR NONPROFIT
ORGANIZATIONS-MULTI-STRATEGY EQUITY FUND
By: BLUM CAPITAL PARTNERS, LP,
Its
By: RICHARD C. BLUM & ASSOCIATES, INC.,
Its General Partner
By: /s/ Murray A. Indick
----------------------------------
Name: Murray A. Indick
---------------------------------
Title: Partner and General Counsel
--------------------------------
14
BK CAPITAL PARTNERS IV, L.P.
STINSON CAPITAL PARTNERS, L.P.
STINSON CAPITAL PARTNERS II, L.P.
STINSON CAPITAL PARTNERS III, L.P.
By: BLUM CAPITAL PARTNERS, L.P.,
its general partner
By: Richard C. Blum & Associates, Inc.,
its general partner
By: /s/ Murray A. Indick
---------------------------------------------
Murray A. Indick, Partner, General Counsel
and Secretary
CARPENTERS PENSION TRUST FOR SOUTHERN
CALIFORNIA
UNITED BROTHERHOOD OF CARPENTERS
PENSION PLAN
STINSON CAPITAL FUND (CAYMAN), LTD.
By: BLUM CAPITAL PARTNERS, L.P.,
its investment advisor
By: Richard C. Blum & Associates, Inc.,
its general partner
By: /s/ Murray A. Indick
---------------------------------------------
Murray A. Indick, Partner, General Counsel
and Secretary
15
SCHEDULE 1
- ----------------------------------------------------------------------------------------------------------------------
Shares Other
Investor Owned Derivative Attributed
Directly Shares Shares
- ----------------------------------------------------------------------------------------------------------------------
BK Capital Partners IV, L.P. 83,000 0 0
- ----------------------------------------------------------------------------------------------------------------------
Blum Strategic Partners, L.P. 117,700 0 0
- ----------------------------------------------------------------------------------------------------------------------
Blum Strategic Partners II, L.P. 2,691,043 1,937,985 0
- ----------------------------------------------------------------------------------------------------------------------
Carpenters Pension Trust for Southern California 776,400 0 0
- ----------------------------------------------------------------------------------------------------------------------
Common Fund 118,800 0 0
- ----------------------------------------------------------------------------------------------------------------------
Stinson Capital Fund (Cayman), LTD. 61,700 0 0
- ----------------------------------------------------------------------------------------------------------------------
Stinson Capital Partners, L.P. 398,700 1,937,985 0
- ----------------------------------------------------------------------------------------------------------------------
Stinson Capital Partners II, L.P. 178,700 775,194 0
- ----------------------------------------------------------------------------------------------------------------------
Stinson Capital Partners III, L.P. 139,700 516,796 0
- ----------------------------------------------------------------------------------------------------------------------
United Brotherhood of Carpenters 118,200 0 0
- ----------------------------------------------------------------------------------------------------------------------
16