Initial Transactions. (a) Upon the request of Parent, the Company shall furnish to Parent its reasonable, good faith estimate of the amount that the Company will be required to pay pursuant to Section 7.6(b)(i) and (ii) and of cash on hand of the Company and its Subsidiaries on the Closing Date. (b) At such time as all of the conditions set forth in Article VIII, other than Section 8.2(f), shall have been satisfied or irrevocably waived by Parent (the "Initial Transaction Time"), the Company shall: (i) repay all Indebtedness for borrowed money of the Company and its Subsidiaries (other than Vendor Excluded Indebtedness), including such Indebtedness under Contracts set forth on Schedule 4.12, and terminate all of its obligations under the Contracts governing such Indebtedness which if not terminated would cause a default under Parent's senior credit facility upon the occurrence of the Effective Time; (ii) cash collateralize all outstanding letters of credit on terms and conditions reasonably satisfactory to Parent; (iii) contribute to a newly formed entity, formed in a non-U.S. jurisdiction reasonably acceptable to Parent, which has timely elected to be treated as a disregarded entity in accordance with United States Treasury Regulation Section 301.7701-3 for United States federal income tax purposes and that is wholly owned by the Company ("New LLC") all of the outstanding capital stock of each of the Company's Subsidiaries listed in Schedule 7.6(b)(iii) (the "Foreign Subsidiary Stock"), such that immediately following such contribution all of the Company's Subsidiaries that are organized in a jurisdiction outside of the United States shall be wholly owned, directly or indirectly, by New LLC. (iv) sell to Purchaser all of the membership interests in New LLC for their book value (the "New LLC Purchase Price"), subject to the requirement that the Surviving Corporation purchase all of the Foreign Subsidiary Stock from New LLC immediately following the Effective Time for a purchase price equal to the New LLC Purchase Price, plus interest thereon from and after the Foreign Subsidiary Sale at the rate of eight percent (8%) per annum. The Company shall deliver to Purchaser such documents as Purchaser shall reasonably request relating to the contribution of the Subsidiaries referenced in clause (iii) of this paragraph (b), and such instruments of transfer of all of the membership interests in New LLC as Purchaser shall reasonably request. (c) Prior to the Initial Transaction Time, Parent may designate one or more Contracts related to Indebtedness for borrowed money extended by publishers who supply the Company as "Vendor Excluded Indebtedness." The Company shall use its reasonable best efforts to have the Vendor Excluded Indebtedness amended to delete any provisions contained therein that would, if not so amended or deleted, cause a default under Parent's senior credit facility upon the occurrence of the Effective Time. Parent shall cooperate with the Company in seeking such amendments or deletions. If, notwithstanding the Company's reasonable best efforts, the provisions are not so amended or deleted as of the Initial Transaction Time, such Contracts shall no longer be deemed to be Vendor Excluded Indebtedness, and shall be repaid as provided in Section 7.6(b)(i). (d) At the Initial Transaction Time, Parent shall extend a loan to the Company in an amount equal to (i) the amount necessary to make the payments required by Section 7.6(b)(i) and (ii), plus (ii) $10 million, minus (iii) the Company's estimate of the cash on hand at the Closing Date provided pursuant to paragraph (a) above. In exchange therefor, the Company shall execute and deliver to Parent a promissory note in the form of Exhibit B hereto. (e) The transactions described in Section 7.6(b)(iii) and (iv) are referred to collectively herein as the "Foreign Subsidiary Sale." To the extent requested by Parent, the parties to this Agreement shall either (i) abandon and not undertake the Foreign Subsidiary Sale, or (ii) restructure the Foreign Subsidiary Sale in a manner not materially adverse to the Shareholders and which will not reduce the Per Share Amount or delay the consummation of the Merger. (f) The transactions described in this Section 7.6 are referred to collectively herein as the "Initial Transactions".
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Initial Transactions. (a) Upon the request of Parent, the Company shall furnish to Parent its reasonable, good faith estimate of the amount that the Company will be required to pay pursuant to Section 7.6(b)(i) and (ii) and of cash on hand of the Company and its Subsidiaries on the Closing Date.
(b) At such time as all of the conditions set forth in Article VIII, other than Section 8.2(f), shall have been satisfied or irrevocably waived by Parent (the "Initial Transaction Time"), the Company shall:
(i) repay all Indebtedness for borrowed money of the Company and its Subsidiaries (other than Vendor Excluded Indebtedness), including such Indebtedness under Contracts set forth on Schedule 4.12, and terminate all of its obligations under the Contracts governing such Indebtedness which if not terminated would cause a default under Parent's senior credit facility upon the occurrence of the Effective Time;
(ii) cash collateralize all outstanding letters of credit on terms and conditions reasonably satisfactory to Parent;
(iii) contribute to a newly formed entity, formed in a non-U.S. jurisdiction reasonably acceptable to Parent, for which a "check the box" election has timely elected to be treated as a disregarded entity in accordance with United States Treasury Regulation Section 301.7701-3 been made for United States federal U.S. income tax purposes purposes, and that is wholly owned by the Company ("New LLC") all of the outstanding capital stock of each of the Company's Subsidiaries listed in Schedule 7.6(b)(iii) (the "Foreign Subsidiary Stock"), such that immediately following such contribution all of the Company's Subsidiaries that are organized in a jurisdiction outside of the United States shall be wholly owned, directly or indirectly, by New LLC.
(iv) sell to Purchaser all of the membership interests in New LLC for their book value (the "New LLC Purchase Price"), subject to the requirement that the Surviving Corporation purchase all of the Foreign Subsidiary Stock from New LLC immediately following the Effective Time for a purchase price equal to the New LLC Purchase Price, plus interest thereon from and after the Foreign Subsidiary Sale at the rate of eight percent (8%) per annum. The Company shall deliver to Purchaser such documents as Purchaser shall reasonably request relating to the contribution of the Subsidiaries referenced in clause (iii) of this -41- paragraph (b), and such instruments of transfer of all of the membership interests in New LLC as Purchaser shall reasonably request.
(c) Prior to the Initial Transaction Time, Parent may designate one or more Contracts related to Indebtedness for borrowed money extended by publishers who supply the Company as "Vendor Excluded Indebtedness." The Company shall use its reasonable best efforts to have the Vendor Excluded Indebtedness amended to delete any provisions contained therein that would, if not so amended or deleted, cause a default under Parent's senior credit facility upon the occurrence of the Effective Time. Parent shall cooperate with the Company in seeking such amendments or deletions. If, notwithstanding the Company's reasonable best efforts, the provisions are not so amended or deleted as of the Initial Transaction Time, such Contracts shall no longer be deemed to be Vendor Excluded Indebtedness, and shall be repaid as provided in Section 7.6(b)(i).
(d) At the Initial Transaction Time, Parent shall extend a loan to the Company in an amount equal to (i) the amount necessary to make the payments required by Section 7.6(b)(i) and (ii), plus (ii) $10 million, minus (iii) the Company's estimate of the cash on hand at the Closing Date provided pursuant to paragraph (a) above. In exchange therefor, the Company shall execute and deliver to Parent a promissory note in the form of Exhibit B hereto.
(e) The transactions described in Section 7.6(b)(iii) and (iv) are referred to collectively herein as the "Foreign Subsidiary Sale." To the extent requested by Parent, the parties to this Agreement shall either (i) abandon and not undertake the Foreign Subsidiary Sale, or (ii) restructure the Foreign Subsidiary Sale in a manner not materially adverse to the Shareholders and which will not reduce the Per Share Amount or delay the consummation of the Merger.
(f) The transactions described in this Section 7.6 are referred to collectively herein as the "Initial Transactions".
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