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EXHIBIT 2.1
REVISION AGREEMENT
This Revision Agreement, dated as of May 30, 1997, (the "Revision
Agreement") is entered into by and among UNITED COMPANIES FINANCIAL
CORPORATION, a Louisiana corporation (the "Seller" or "UCFC"), PENNCORP
FINANCIAL GROUP, INC., a Delaware Corporation ("PennCorp"), PACIFIC LIFE AND
ACCIDENT INSURANCE COMPANY, a Texas-domiciled insurance company (the
"Purchaser") and each of the additional parties set forth on the signature page
hereto.
PRELIMINARY STATEMENT
WHEREAS, the Seller and the Purchaser entered into and executed an Amended
and Restated Stock Purchase Agreement dated as of July 24, 1996 (the "Stock
Purchase Agreement"); and
WHEREAS, pursuant to the terms of the Stock Purchase Agreement, the Seller
sold all of the issued and outstanding shares of common stock, $2.00 pare value
per share (the "Shares"), of its wholly-owned subsidiary, United Companies Life
Insurance Company, a Louisiana stock life insurance company (the "Company" or
"UCLIC"), to the Purchaser and the Purchaser purchased the Shares from the
Seller; and
WHEREAS, subsequent to the sale of the Shares, the Seller and the
Purchaser agreed to revise, in the manner set forth herein, the Stock Purchase
Agreement and certain related agreements, as indicated below, that were entered
into by Purchaser, PennCorp, Seller or certain of their affiliates.
Capitalized terms used herein and not otherwise defined shall have the meanings
ascribed to them in each of the respective agreements.
NOW, THEREFORE, in consideration of the covenants and agreements set forth
herein, the parties hereto agree as follows:
Section A. Stock Purchase Agreement
(1) UCFC and Purchaser agree that pursuant to Section 2.06 of the Stock
Purchase Agreement no Corrected Amount is owing from the Seller to the
Purchaser or from the Purchaser to the Seller.
(2) Section 5.07(a) (Use of Names and Intellectual Property) of the Stock
Purchase Agreement is hereby amended by deleting such Section in its entirety
and replacing such Section with the following:
(a) The Seller covenants and agrees that following the Closing, the
Purchaser shall have the exclusive (as provided in subclause (D) below
and to the
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extent Seller can so grant), and royalty-free right to use the
name "United" or "The United" and "Life and Annuity Insurance Company"
(the Name") in connection with the Business; provided, however, that (A)
(i) the Purchaser shall not use the words "Companies" or "Title"
immediately after the word "United" and (ii) the Purchaser will not be
permitted any use of the logo of the Seller which was used by the Company
or the Subsidiary prior to the Closing and which is attached hereto as
Exhibit 5.07 (except as provided in subclause (B) below); (B) the
Purchaser may continue to utilize the Company's existing name or the
logo, including but not limited to, on stationery, invoices, purchase
orders or other clerical or similar supplies until March 31, 1997 or such
later date as the Seller may agree; (C) any such use of the Name or logo
shall not be reasonably likely to cause confusion, mistake or deception
as to the affiliation, connection or association between Seller, on the
one hand, and Purchaser or its Affiliates (including, without limitation,
the Company and the Subsidiary after the acquisition thereof pursuant to
this Agreement), on the other hand, or as to the origin, sponsorship
or approval of the Purchaser's or its Affiliates' (including, without
limitation, the Company and the Subsidiary after the acquisition thereof
pursuant to this Agreement) goods or services and (D) Purchaser's
exclusive rights described in this Section 5.07(a) shall not limit the
right of the Seller and its Affiliates to use the Name in connection with
its business as conducted following the Closing. Notwithstanding the
foregoing, the Purchaser covenants and agrees that following the
execution of this Revision Agreement it shall, as promptly as
practicable, take all actions necessary to change the name of the Company
to United Life & Annuity Company.
(3) Section 5.20 (Location) of the Stock Purchase Agreement is hereby
amended by adding the following after the last sentence thereof:
Notwithstanding the foregoing, if the Purchaser, after the date
of this Revision Agreement, desires to reduce or remove the
Company's presence in Baton Rouge at any time, the Seller shall
cooperate with the Purchaser with respect to such reduction or
removal to minimize personal dislocation and community or
regulatory reaction. Seller shall have no obligation to offer
employment to any employee of the Company.
SECTION B. CONVERSION, STANDSTILL AND REGISTRATION RIGHTS (THE "CSR
AGREEMENT") DATED AS OF JULY 24, 1996 BY AND BETWEEN UCFC AND
PENNCORP
(1) Effective February 12, 1997, PennCorp purchased from UCFC
483,839 shares of common stock of PennCorp (the "PennCorp Shares")
subject to the CSR Agreement for the purchase price of $17,902,043 (the
"Proceeds"). At the closing of the transaction (the "Closing") which
shall occur on any business day between May 13, 1997 and June 12, 1997,
as determined by PennCorp in its sole discretion (the "Closing Date"),
provided, however, that PennCorp has provided UCFC with two business
days prior notice of the Closing Date, PennCorp shall pay to UCFC the
Proceeds plus interest at the rate
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of 5.134% per annum from February 12, 1997 to the Closing Date. PennCorp
shall pay the Proceeds plus interest as specified herein by wire
transfer of immediately available funds to an account designated by UCFC
at least one business day prior to the Closing Date. At the Closing on
the Closing Date, UCFC shall deliver the stock certificate previously
received by it under the CSR Agreement evidencing the PennCorp Shares to
PennCorp, duly endorsed in blank or accompanied by a duly executed stock
power, free and clear of all claims, liens and encumbrances of any kind.
Prior to the Closing Date, UCFC shall continue to maintain possession of
the PennCorp Shares as pledgee and PennCorp hereby confirms the grant of
a security interest therein in favor of UCFC to secure PennCorp's
obligation to pay to UCFC the Proceeds plus interest as specified above.
(2) PennCorp believes that it was at all times and continues to remain in
compliance in all respects with Section 8 of the CSR Agreement.
Notwithstanding the foregoing and conditioned upon PennCorp's payment of the
Proceeds plus interest as provided in Section B(1) above, UCFC releases and
discharges PennCorp of all obligations and liabilities under the CSR Agreement
with respect to or arising out of PennCorp's obligation to file with the
Securities and Exchange Commission and have declared effective a shelf
registration statement pursuant to Rule 415 of the Securities Act of 1933.
Further, and subject to such condition, UCFC hereby waives, releases and
discharges PennCorp and its predecessors, successors and assigns, and its past
and present officers, directors, employees, agents and representatives from all
actions, causes of action, suits, debts, sums of money, covenants, contracts,
agreements, promises, damages, judgments, claims and demands whatsoever, in
law, or in equity, which UCFC ever had, now has, or which UCFC or its
predecessors, successors and assigns hereafter can, shall, or may have for,
upon, or by reason of any matter, cause or thing whatsoever at any time, past
or future, relating or referring in any manner to any and all claims by UCFC or
its predecessors, successors and assigns, arising out of or with respect to
Section 8 of the CSR Agreement on or prior to the date hereof.
(3) Upon payment of the Proceeds and interest as provided in Section B(1)
above, Section 8 of the CSR Agreement shall be deleted in its entirety.
(4) Upon payment of the Proceeds and interest as provided in Section B(1)
above, Section 9 of the CSR Agreement is hereby deleted in its entirety.
PennCorp hereby waives, releases and discharges UCFC and its predecessors,
successors and assigns, and its past and present officers, directors,
employees, agents and representatives from all actions, causes of action,
suits, debts, sums of money, covenants, contracts, agreements, promises,
damages, judgments, claims and demands whatsoever, in law, or in equity, which
PennCorp ever had, now has, or which PennCorp or its predecessors, successors
and assigns hereafter can, shall, or may have for, upon, or by reason of any
matter, cause or thing whatsoever at any time, past or future, relating or
referring in any manner to any and all claims by PennCorp or its predecessors,
successors and assigns, arising out of or with respect to Section 9 of the CSR
Agreement on or prior to the date hereof.
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SECTION C. THREE UNITED PLAZA LEASE AGREEMENT DATED AS OF MARCH 10, 1995
(THE "LEASE"), AS AMENDED BY FIRST AMENDMENT DATED AS OF JULY
24, 1996, (THE "LEASE AGREEMENT") BY AND BETWEEN UNITED
COMPANIES REALTY & DEVELOPMENT COMPANY, INC. AND THE COMPANY
(1) Section 1 of the Lease Agreement is hereby amended by deleting such
Section in its entirety and replacing such Section with the following:
1. The Lease Term as defined in Section 1.01 of the Lease
shall terminate on January 24, 1999; provided, however, that upon
thirty days' notice from PennCorp to the Seller (the "Notice"),
the Seller shall, from and after the effective date specified in
the Notice (the "Effective Date"), sublease from the Company, and
assume all of the Company's obligations accruing from and after
the Effective Date with respect to, all or such portion(s) of the
premises currently leased by the Company as designated by PennCorp
in the Notice, on the same terms and conditions as provided in the
Lease, as amended hereby; provided, however, that if less than all
of the premises are subleased, the portion(s) subject to the
sublease shall be commercially reasonable blocks of space. Seller
shall indemnify and hold harmless the Company and the Purchaser
and their affiliates from and after the Effective Date with
respect to all obligations and liabilities accruing thereafter
under the Lease, as amended hereby, with respect to the premises
so subleased, including, without limitation, any obligation for
the payment of any rent, or additional rent or any obligations
arising from any default of the terms or conditions of the Lease,
as amended, by the Seller or any subtenant of all or any portion
of the premises so subleased.
SECTION D. AMENDMENT OF MASTER LOAN SALE AGREEMENT, DATED AS OF JULY 24,
1996 (THE "MASTER LOAN SALE AGREEMENT"), BY AND AMONG UNITED
COMPANIES LIFE INSURANCE COMPANY ("UCLIC" OR THE "PURCHASER")
AND UNITED COMPANIES LENDING CORPORATION(R) ("UCLC"),
SOUTHERN MORTGAGE ACQUISITION, INC., UNICOR MORTGAGE(R),
INC., GINGER MAE(R), INC., UNITED COMPANIES LENDING GROUP,
INC. AND UNITED COMPANIES MORTGAGE OF TENNESSEE, INC.
(COLLECTIVELY, THE "SELLERS").
The parties agree that for purposes of this Section D only, "Purchaser"
as defined above, refers to UCLIC and not to Pacific Life and Accident
Insurance Company.
(1) Section 2 of the Master Loan Sale Agreement shall be amended by
deleting the definition of S&P in its entirety.
(2) Section 3(a) of the Master Loan Sale Agreement shall be amended by
deleting the references to $30,000,000, $150,000,000 and $50,000,000 and
replacing such references with $150,000,000, $75,000,000 and $25,000,000,
respectively.
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(3) Section 6(f) of the Master Loan Sale Agreement shall be amended by
deleting such Section in its entirety and replacing such Section with the
following:
(f) UCLC and UCLG hereby warrant, covenant and agree that
either UCLC or UCLG shall, prior to and following the date of
execution of this Revision Agreement, maintain an actual or
implied long-term senior debt rating which is at least investment
grade from Duff (such rating, the "Credit Rating").
(4) Section 7(c) of the Master Loan Sale Agreement shall be amended by
deleting the reference to $15,000,000 and replacing such reference with
$7,500,000.
(5) Section 10 of the Master Loan Sale Agreement shall be amended by
adding the following paragraph as Section 10(c) and renumber the existing
Section 10(c) as Section 10(d):
(c) Following the Servicer's foreclosure of the Mortgaged
Property securing and Defaulted Loan pursuant to Section 3(H) of
the Servicing Agreement, the Sellers shall be jointly and
severally obligated, and each hereby agrees, to promptly (but in
no event more than ten days following the date of each such
foreclosure) repurchase suck foreclosed Mortgaged Property
acquired by the Servicer on behalf of the Purchaser by paying the
Purchaser an amount equal to the Repurchase Price for the related
defaulted Loan.
SECTION E. AMENDMENT OF SERVICING AGREEMENT, DATED AS OF JULY 24, 1996
(THE "SERVICING AGREEMENT"), BY AND BETWEEN UCLIC AND UCLC,
AS SERVICER ("SERVICER").
(1) Section 3(H) of the Servicing Agreement is hereby amended by deleting
such Section in its entirety and replacing such Section with the following:
H. Upon any Note becoming a Defaulted Note, Servicer, in
accordance with the standards set forth in Sections 3(E) and 3(I)
hereof, shall foreclose on the Mortgaged Property securing such
Defaulted Note. Promptly following the foreclosure of such
Mortgaged Property, the Sellers, pursuant to Section 10(c) of the
Master Loan Sale Agreement, as amended, shall be required to
purchase such property from UCLIC at the Purchase Price.
Notwithstanding the foregoing, Servicer may, at its option, and
from time to time purchase any Defaulted Note at the Purchaser
Price for cash. Prior to the time purchase any Defaulted Note at
the Purchaser Price for cash. Prior to the time that UCLIC has
received the full Purchase Price for each Defaulted Note, Servicer
agrees and shall be obligated to promptly distribute to UCLIC all
proceeds recovered by Servicer in connection with any foreclosure,
liquidation or other legal proceeding in an amount up to the
Purchase Price for each suck Defaulted Note. Any such proceeds
received from Servicer with respect to such Defaulted Note shall
be
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deemed a reduction of the Purchase Price to be paid by the
Sellers or Servicer, as applicable. UCLIC agrees to execute such
documentation as Servicer may reasonably request in order to
effect any such purchase and any "out-of-pocket" expenses incurred
by UCLIC in connection therewith shall be borne by Servicer.
SECTION F. THIS REVISION AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK,
APPLICABLE TO CONTRACTS EXECUTED IN AND TO BE PERFORMED
ENTIRELY WITHIN THAT STATE.
SECTION G. AS MODIFIED HEREIN, THE STOCK PURCHASE AGREEMENT, CSR
AGREEMENT, THE LEASE AGREEMENT AND MASTER LOAN SALE AGREEMENT
AND SERVICING AGREEMENT SHALL EACH CONTINUE IN FULL FORCE AND
EFFECT IN ACCORDANCE WITH THEIR TERMS SET FORTH THEREIN
RESPECTIVELY.
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IN WITNESS WHEREOF, the parties hereto have caused this Revision Agreement
to be executed as of the date first written above by their respective officers
thereunto duly authorized.
UNITED COMPANIES FINANCIAL CORPORATION
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
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Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Executive Vice President and
Chief Financial Officer
PENNCORP FINANCIAL GROUP, INC.
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
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Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Senior Vice President
General Counsel and Secretary
PACIFIC LIFE AND ACCIDENT INSURANCE
COMPANY
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
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Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Senior Vice President
General Counsel and Secretary
UNITED COMPANIES LIFE INSURANCE COMPANY
UNITED LIFE & ANNUITY INSURANCE COMPANY
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Executive Vice President
Chief Actuary and Chief Admin.
Officer
UNITED COMPANIES LENDING
CORPORATION(R)
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
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Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice Chairman
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SOUTHERN MORTGAGE ACQUISITION, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
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Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice Chairman
UNICOR MORTGAGE(R), INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
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Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice Chairman
GINGER MAE(R), INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
-------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice Chairman
UNITED COMPANIES LENDING GROUP, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
-------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice Chairman
UNITED COMPANIES MORTGAGE OF
TENNESSEE, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
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Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice Chairman
UNITED COMPANIES REALTY &
DEVELOPMENT COMPANY, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
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Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice Chairman
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