SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
The Learning Company, Inc.
(Name of Issuer)
Common Stock, par value $0.01 per share
(Title of Class of Securities)
522008 10 1
(CUSIP Number)
<TABLE>
<S> <C> <C>
ANTHONY J. DINOVI MARK E. NUNNELLY PAUL J. ZEPF
THOMAS H. LEE COMPANY BAIN CAPITAL, INC. CENTRE PARTNERS MANAGEMENT LLC
75 STATE STREET TWO COPLEY PLACE 30 ROCKEFELLER PLAZA, STE. 5050
BOSTON, MASSACHUSETTS 02109 BOSTON, MASSACHUSETTS 02116 NEW YORK, NEW YORK 10020
(617) 227-1050 (617) 572-3000 (212) 332-5800
- -----------------------------------------------------------------------------------------------
</TABLE>
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
December 5, 1997
(Date of Event which Requires
Filing of this Statement)
If the filing person has previously filed a statement on Schedule
13G to report the acquisition which is the subject of this Schedule
13D, and is filing this schedule because of Rule 13d-1(b)(3) or
(4), check the follow ing box [ ].
SCHEDULE 13D
CUSIP No. 522008 10 1
-----------------------------------------------------------------
(1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Thomas H. Lee Equity Fund III, L.P.
-----------------------------------------------------------------
(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP:
(a) ( )
(b) (x)
-----------------------------------------------------------------
(3) SEC USE ONLY
-----------------------------------------------------------------
(4) SOURCE OF FUNDS
OO
-----------------------------------------------------------------
(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) ( )
------------------------------------------------------------------
(6) CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
-----------------------------------------------------------------
(7) SOLE VOTING POWER
NUMBER OF
SHARES ___________________________________
BENEFICIALLY (8) SHARED VOTING POWER
OWNED BY 7,846,840 (See Item 5)
EACH ___________________________________
REPORTING (9) SOLE DISPOSITIVE POWER
PERSON
WITH ___________________________________
(10) SHARED DISPOSITIVE POWER
7,846,840 (See Item 5)
-----------------------------------------------------------------
(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
7,846,840 (See Item 5)
-----------------------------------------------------------------
(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN
SHARES ( )
-----------------------------------------------------------------
(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
14.0%
-----------------------------------------------------------------
(14) TYPE OF REPORTING PERSON
PN
-----------------------------------------------------------------
SCHEDULE 13D
CUSIP No. 522008 10 1
-----------------------------------------------------------------
(1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Thomas H. Lee Foreign Fund III, L.P.
-----------------------------------------------------------------
(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP:
(a) ( )
(b) (x)
-----------------------------------------------------------------
(3) SEC USE ONLY
-----------------------------------------------------------------
(4) SOURCE OF FUNDS
OO
-----------------------------------------------------------------
(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) ( )
------------------------------------------------------------------
(6) CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
-----------------------------------------------------------------
(7) SOLE VOTING POWER
NUMBER OF
SHARES ___________________________________
BENEFICIALLY (8) SHARED VOTING POWER
OWNED BY 485,540 (See Item 5)
EACH ___________________________________
REPORTING (9) SOLE DISPOSITIVE POWER
PERSON
WITH ___________________________________
(10) SHARED DISPOSITIVE POWER
485,540 (See Item 5)
-----------------------------------------------------------------
(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
485,540 (See Item 5)
-----------------------------------------------------------------
(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN
SHARES ( )
-----------------------------------------------------------------
(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
1.0%
-----------------------------------------------------------------
(14) TYPE OF REPORTING PERSON
PN
-----------------------------------------------------------------
SCHEDULE 13D
CUSIP No. 522008 10 1
-----------------------------------------------------------------
(1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
THL Equity Advisors III Limited Partnership
-----------------------------------------------------------------
(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP:
(a) ( )
(b) (x)
-----------------------------------------------------------------
(3) SEC USE ONLY
-----------------------------------------------------------------
(4) SOURCE OF FUNDS
N/A
-----------------------------------------------------------------
(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) ( )
------------------------------------------------------------------
(6) CITIZENSHIP OR PLACE OF ORGANIZATION
Massachusetts
-----------------------------------------------------------------
(7) SOLE VOTING POWER
NUMBER OF
SHARES ___________________________________
BENEFICIALLY (8) SHARED VOTING POWER
OWNED BY 8,332,380 (See Item 5)
EACH ___________________________________
REPORTING (9) SOLE DISPOSITIVE POWER
PERSON
WITH ___________________________________
(10) SHARED DISPOSITIVE POWER
8,332,380 (See Item 5)
-----------------------------------------------------------------
(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
8,332,380 (See Item 5)
-----------------------------------------------------------------
(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN
SHARES ( )
-----------------------------------------------------------------
(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
14.8%
-----------------------------------------------------------------
(14) TYPE OF REPORTING PERSON
PN
-----------------------------------------------------------------
SCHEDULE 13D
CUSIP No. 522008 10 1
-----------------------------------------------------------------
(1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
THL Equity Trust III
-----------------------------------------------------------------
(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP:
(a) ( )
(b) (x)
-----------------------------------------------------------------
(3) SEC USE ONLY
-----------------------------------------------------------------
(4) SOURCE OF FUNDS
N/A
-----------------------------------------------------------------
(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) ( )
------------------------------------------------------------------
(6) CITIZENSHIP OR PLACE OF ORGANIZATION
Massachusetts
-----------------------------------------------------------------
(7) SOLE VOTING POWER
NUMBER OF
SHARES ___________________________________
BENEFICIALLY (8) SHARED VOTING POWER
OWNED BY 8,332,380 (See Item 5)
EACH ___________________________________
REPORTING (9) SOLE DISPOSITIVE POWER
PERSON
WITH ___________________________________
(10) SHARED DISPOSITIVE POWER
8,332,380 (See Item 5)
-----------------------------------------------------------------
(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
8,332,380 (See Item 5)
-----------------------------------------------------------------
(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN
SHARES ( )
-----------------------------------------------------------------
(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
14.8%
-----------------------------------------------------------------
(14) TYPE OF REPORTING PERSON
OO
-----------------------------------------------------------------
SCHEDULE 13D
CUSIP No. 522008 10 1
-----------------------------------------------------------------
(1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
THL-CCI Investors Limited Partnership
-----------------------------------------------------------------
(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP:
(a) ( )
(b) (x)
-----------------------------------------------------------------
(3) SEC USE ONLY
-----------------------------------------------------------------
(4) SOURCE OF FUNDS
00
-----------------------------------------------------------------
(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) ( )
------------------------------------------------------------------
(6) CITIZENSHIP OR PLACE OF ORGANIZATION
Massachusetts
-----------------------------------------------------------------
(7) SOLE VOTING POWER
NUMBER OF
SHARES ___________________________________
BENEFICIALLY (8) SHARED VOTING POWER
OWNED BY 471,700 (See Item 5)
EACH ___________________________________
REPORTING (9) SOLE DISPOSITIVE POWER
PERSON
WITH ___________________________________
(10) SHARED DISPOSITIVE POWER
471,700 (See Item 5)
-----------------------------------------------------------------
(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
471,700 (See Item 5)
-----------------------------------------------------------------
(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN
SHARES ( )
-----------------------------------------------------------------
(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
1.0%
-----------------------------------------------------------------
(14) TYPE OF REPORTING PERSON
PN
-----------------------------------------------------------------
SCHEDULE 13D
CUSIP No. 522008 10 1
-----------------------------------------------------------------
(1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
THL Investment Management Corp.
-----------------------------------------------------------------
(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP:
(a) ( )
(b) (x)
-----------------------------------------------------------------
(3) SEC USE ONLY
-----------------------------------------------------------------
(4) SOURCE OF FUNDS
N/A
-----------------------------------------------------------------
(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) ( )
------------------------------------------------------------------
(6) CITIZENSHIP OR PLACE OF ORGANIZATION
Massachusetts
-----------------------------------------------------------------
(7) SOLE VOTING POWER
NUMBER OF
SHARES ___________________________________
BENEFICIALLY (8) SHARED VOTING POWER
OWNED BY 471,700 (See Item 5)
EACH ___________________________________
REPORTING (9) SOLE DISPOSITIVE POWER
PERSON
WITH ___________________________________
(10) SHARED DISPOSITIVE POWER
471,700 (See Item 5)
-----------------------------------------------------------------
(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
471,700 (See Item 5)
-----------------------------------------------------------------
(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN
SHARES ( )
-----------------------------------------------------------------
(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
1.0%
-----------------------------------------------------------------
(14) TYPE OF REPORTING PERSON
CO
-----------------------------------------------------------------
SCHEDULE 13D
CUSIP No. 522008 10 1
-----------------------------------------------------------------
(1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
David V. Harkins
-----------------------------------------------------------------
(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP:
(a) ( )
(b) (x)
-----------------------------------------------------------------
(3) SEC USE ONLY
-----------------------------------------------------------------
(4) SOURCE OF FUNDS
OO
-----------------------------------------------------------------
(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) ( )
------------------------------------------------------------------
(6) CITIZENSHIP OR PLACE OF ORGANIZATION
United States
-----------------------------------------------------------------
(7) SOLE VOTING POWER
NUMBER OF 58,600 (See Item 5)
SHARES ___________________________________
BENEFICIALLY (8) SHARED VOTING POWER
OWNED BY 6,520 (See Item 5)
EACH __________________________________
REPORTING (9) SOLE DISPOSITIVE POWER PERSON
WITH 58,600 (See Item 5)
___________________________________
(10) SHARED DISPOSITIVE POWER
6,520 (See Item 5)
-----------------------------------------------------------------
(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
65,120 (See Item 5)
-----------------------------------------------------------------
(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN
SHARES ( )
-----------------------------------------------------------------
(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
0.1%
-----------------------------------------------------------------
(14) TYPE OF REPORTING PERSON
IN
-----------------------------------------------------------------
SCHEDULE 13D
CUSIP No. 522008 10 1
-----------------------------------------------------------------
(1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
The 1995 Harkins Gift Trust
-----------------------------------------------------------------
(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP:
(a) ( )
(b) (x)
-----------------------------------------------------------------
(3) SEC USE ONLY
-----------------------------------------------------------------
(4) SOURCE OF FUNDS
OO
-----------------------------------------------------------------
(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) ( )
------------------------------------------------------------------
(6) CITIZENSHIP OR PLACE OF ORGANIZATION
Massachusetts
-----------------------------------------------------------------
(7) SOLE VOTING POWER
NUMBER OF 6,520 (See Item 5)
SHARES ___________________________________
BENEFICIALLY (8) SHARED VOTING POWER
OWNED BY
EACH ___________________________________
REPORTING (9) SOLE DISPOSITIVE POWER
PERSON 6,520 (See Item 5)
WITH ___________________________________
(10) SHARED DISPOSITIVE POWER
-----------------------------------------------------------------
(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
6,520 (See Item 5)
-----------------------------------------------------------------
(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN
SHARES ( )
-----------------------------------------------------------------
(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
0.01%
-----------------------------------------------------------------
(14) TYPE OF REPORTING PERSON
OO
-----------------------------------------------------------------
SCHEDULE 13D
CUSIP No. 522008 10 1
-----------------------------------------------------------------
(1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Meetinghouse Foundation, Inc.
-----------------------------------------------------------------
(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP:
(a) ( )
(b) (x)
-----------------------------------------------------------------
(3) SEC USE ONLY
-----------------------------------------------------------------
(4) SOURCE OF FUNDS
OO
-----------------------------------------------------------------
(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) ( )
------------------------------------------------------------------
(6) CITIZENSHIP OR PLACE OF ORGANIZATION
Massachusetts
-----------------------------------------------------------------
(7) SOLE VOTING POWER
NUMBER OF 20,340 (See Item 5)
SHARES ___________________________________
BENEFICIALLY (8) SHARED VOTING POWER
OWNED BY
EACH ___________________________________
REPORTING (9) SOLE DISPOSITIVE POWER
PERSON 20,340 (See Item 5)
WITH ___________________________________
(10) SHARED DISPOSITIVE POWER
-----------------------------------------------------------------
(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
20,340 (See Item 5)
-----------------------------------------------------------------
(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN
SHARES ( )
-----------------------------------------------------------------
(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
0.04%
-----------------------------------------------------------------
(14) TYPE OF REPORTING PERSON
00
-----------------------------------------------------------------
SCHEDULE 13D
CUSIP No. 522008 10 1
-----------------------------------------------------------------
(1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Scott A. Schoen
-----------------------------------------------------------------
(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP:
(a) ( )
(b) (x)
-----------------------------------------------------------------
(3) SEC USE ONLY
-----------------------------------------------------------------
(4) SOURCE OF FUNDS
OO
-----------------------------------------------------------------
(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) ( )
------------------------------------------------------------------
(6) CITIZENSHIP OR PLACE OF ORGANIZATION
United States
-----------------------------------------------------------------
(7) SOLE VOTING POWER
NUMBER OF 39,080 (See Item 5)
SHARES ___________________________________
BENEFICIALLY (8) SHARED VOTING POWER
OWNED BY
EACH ___________________________________
REPORTING (9) SOLE DISPOSITIVE POWER
PERSON 39,080 (See Item 5)
WITH ___________________________________
(10) SHARED DISPOSITIVE POWER
-----------------------------------------------------------------
(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
39,080 (See Item 5)
-----------------------------------------------------------------
(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN
SHARES ( )
-----------------------------------------------------------------
(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
0.08%
-----------------------------------------------------------------
(14) TYPE OF REPORTING PERSON
IN
-----------------------------------------------------------------
SCHEDULE 13D
CUSIP No. 522008 10 1
-----------------------------------------------------------------
(1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
C. Hunter Boll
-----------------------------------------------------------------
(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP:
(a) ( )
(b) (x)
-----------------------------------------------------------------
(3) SEC USE ONLY
-----------------------------------------------------------------
(4) SOURCE OF FUNDS
OO
-----------------------------------------------------------------
(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) ( )
------------------------------------------------------------------
(6) CITIZENSHIP OR PLACE OF ORGANIZATION
United States
-----------------------------------------------------------------
(7) SOLE VOTING POWER
NUMBER OF 39,080 (See Item 5)
SHARES ___________________________________
BENEFICIALLY (8) SHARED VOTING POWER
OWNED BY
EACH ___________________________________
REPORTING (9) SOLE DISPOSITIVE POWER
PERSON 39,080 (See Item 5)
WITH ___________________________________
(10) SHARED DISPOSITIVE POWER
-----------------------------------------------------------------
(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
39,080 (See Item 5)
-----------------------------------------------------------------
(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN
SHARES ( )
-----------------------------------------------------------------
(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
0.08%
-----------------------------------------------------------------
(14) TYPE OF REPORTING PERSON
IN
-----------------------------------------------------------------
SCHEDULE 13D
CUSIP No. 522008 10 1
-----------------------------------------------------------------
(1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Scott M. Sperling
-----------------------------------------------------------------
(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP:
(a) ( )
(b) (x)
-----------------------------------------------------------------
(3) SEC USE ONLY
-----------------------------------------------------------------
(4) SOURCE OF FUNDS
OO
-----------------------------------------------------------------
(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) ( )
------------------------------------------------------------------
(6) CITIZENSHIP OR PLACE OF ORGANIZATION
United States
-----------------------------------------------------------------
(7) SOLE VOTING POWER
NUMBER OF 32,560 (See Item 5)
SHARES ___________________________________
BENEFICIALLY (8) SHARED VOTING POWER
OWNED BY
EACH ___________________________________
REPORTING (9) SOLE DISPOSITIVE POWER
PERSON 32,560 (See Item 5)
WITH ___________________________________
(10) SHARED DISPOSITIVE POWER
-----------------------------------------------------------------
(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
32,560 (See Item 5)
-----------------------------------------------------------------
(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN
SHARES ( )
-----------------------------------------------------------------
(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
0.07%
-----------------------------------------------------------------
(14) TYPE OF REPORTING PERSON
IN
-----------------------------------------------------------------
SCHEDULE 13D
CUSIP No. 522008 10 1
-----------------------------------------------------------------
(1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Anthony J. DiNovi
-----------------------------------------------------------------
(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP:
(a) ( )
(b) (x)
-----------------------------------------------------------------
(3) SEC USE ONLY
-----------------------------------------------------------------
(4) SOURCE OF FUNDS
OO
-----------------------------------------------------------------
(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) ( )
------------------------------------------------------------------
(6) CITIZENSHIP OR PLACE OF ORGANIZATION
United States
-----------------------------------------------------------------
(7) SOLE VOTING POWER
NUMBER OF 32,560 (See Item 5)
SHARES ___________________________________
BENEFICIALLY (8) SHARED VOTING POWER
OWNED BY
EACH ___________________________________
REPORTING (9) SOLE DISPOSITIVE POWER
PERSON 32,560 (See Item 5)
WITH ___________________________________
(10) SHARED DISPOSITIVE POWER
-----------------------------------------------------------------
(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
32,560 (See Item 5)
-----------------------------------------------------------------
(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN
SHARES ( )
-----------------------------------------------------------------
(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
0.07%
-----------------------------------------------------------------
(14) TYPE OF REPORTING PERSON
IN
-----------------------------------------------------------------
SCHEDULE 13D
CUSIP No. 522008 10 1
-----------------------------------------------------------------
(1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Thomas M. Hagerty
-----------------------------------------------------------------
(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP:
(a) ( )
(b) (x)
-----------------------------------------------------------------
(3) SEC USE ONLY
-----------------------------------------------------------------
(4) SOURCE OF FUNDS
OO
-----------------------------------------------------------------
(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) ( )
------------------------------------------------------------------
(6) CITIZENSHIP OR PLACE OF ORGANIZATION
United States
-----------------------------------------------------------------
(7) SOLE VOTING POWER
NUMBER OF 32,560 (See Item 5)
SHARES ___________________________________
BENEFICIALLY (8) SHARED VOTING POWER
OWNED BY
EACH ___________________________________
REPORTING (9) SOLE DISPOSITIVE POWER
PERSON 32,560 (See Item 5)
WITH ___________________________________
(10) SHARED DISPOSITIVE POWER
-----------------------------------------------------------------
(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
32,560 (See Item 5)
-----------------------------------------------------------------
(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN
SHARES ( )
-----------------------------------------------------------------
(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
0.07%
-----------------------------------------------------------------
(14) TYPE OF REPORTING PERSON
IN
-----------------------------------------------------------------
SCHEDULE 13D
CUSIP No. 522008 10 1
-----------------------------------------------------------------
(1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Warren C. Smith, Jr.
-----------------------------------------------------------------
(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP:
(a) ( )
(b) (x)
-----------------------------------------------------------------
(3) SEC USE ONLY
-----------------------------------------------------------------
(4) SOURCE OF FUNDS
OO
-----------------------------------------------------------------
(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) ( )
------------------------------------------------------------------
(6) CITIZENSHIP OR PLACE OF ORGANIZATION
United States
-----------------------------------------------------------------
(7) SOLE VOTING POWER
NUMBER OF 32,560 (See Item 5)
SHARES ___________________________________
BENEFICIALLY (8) SHARED VOTING POWER
OWNED BY
EACH ___________________________________
REPORTING (9) SOLE DISPOSITIVE POWER
PERSON 32,560 (See Item 5)
WITH ___________________________________
(10) SHARED DISPOSITIVE POWER
-----------------------------------------------------------------
(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
32,560 (See Item 5)
-----------------------------------------------------------------
(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN
SHARES ( )
-----------------------------------------------------------------
(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
0.07%
-----------------------------------------------------------------
(14) TYPE OF REPORTING PERSON
IN
-----------------------------------------------------------------
SCHEDULE 13D
CUSIP No. 522008 10 1
-----------------------------------------------------------------
(1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Seth W. Lawry
-----------------------------------------------------------------
(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP:
(a) ( )
(b) (x)
-----------------------------------------------------------------
(3) SEC USE ONLY
-----------------------------------------------------------------
(4) SOURCE OF FUNDS
OO
-----------------------------------------------------------------
(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) ( )
------------------------------------------------------------------
(6) CITIZENSHIP OR PLACE OF ORGANIZATION
United States
-----------------------------------------------------------------
(7) SOLE VOTING POWER
NUMBER OF 9,760 (See Item 5)
SHARES ___________________________________
BENEFICIALLY (8) SHARED VOTING POWER
OWNED BY
EACH ___________________________________
REPORTING (9) SOLE DISPOSITIVE POWER
PERSON 9,760 (See Item 5)
WITH ___________________________________
(10) SHARED DISPOSITIVE POWER
-----------------------------------------------------------------
(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
9,760 (See Item 5)
-----------------------------------------------------------------
(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN
SHARES ( )
-----------------------------------------------------------------
(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
0.02%
-----------------------------------------------------------------
(14) TYPE OF REPORTING PERSON
IN
-----------------------------------------------------------------
SCHEDULE 13D
CUSIP No. 522008 10 1
-----------------------------------------------------------------
(1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Joseph J. Incandela
-----------------------------------------------------------------
(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP:
(a) ( )
(b) (x)
-----------------------------------------------------------------
(3) SEC USE ONLY
-----------------------------------------------------------------
(4) SOURCE OF FUNDS
OO
-----------------------------------------------------------------
(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) ( )
------------------------------------------------------------------
(6) CITIZENSHIP OR PLACE OF ORGANIZATION
United States
-----------------------------------------------------------------
(7) SOLE VOTING POWER
NUMBER OF 8,140 (See Item 5)
SHARES ___________________________________
BENEFICIALLY (8) SHARED VOTING POWER
OWNED BY
EACH ___________________________________
REPORTING (9) SOLE DISPOSITIVE POWER
PERSON 8,140 (See Item 5)
WITH ___________________________________
(10) SHARED DISPOSITIVE POWER
-----------------------------------------------------------------
(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
8,140 (See Item 5)
-----------------------------------------------------------------
(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN
SHARES ( )
-----------------------------------------------------------------
(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
0.02%
-----------------------------------------------------------------
(14) TYPE OF REPORTING PERSON
IN
-----------------------------------------------------------------
SCHEDULE 13D
CUSIP No. 522008 10 1
-----------------------------------------------------------------
(1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Kent R. Weldon
-----------------------------------------------------------------
(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP:
(a) ( )
(b) (x)
-----------------------------------------------------------------
(3) SEC USE ONLY
-----------------------------------------------------------------
(4) SOURCE OF FUNDS
OO
-----------------------------------------------------------------
(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) ( )
------------------------------------------------------------------
(6) CITIZENSHIP OR PLACE OF ORGANIZATION
United States
-----------------------------------------------------------------
(7) SOLE VOTING POWER
NUMBER OF 4,880 (See Item 5)
SHARES ___________________________________
BENEFICIALLY (8) SHARED VOTING POWER
OWNED BY
EACH ___________________________________
REPORTING (9) SOLE DISPOSITIVE POWER
PERSON 4,880 (See Item 5)
WITH ___________________________________
(10) SHARED DISPOSITIVE POWER
-----------------------------------------------------------------
(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
4,880 (See Item 5)
-----------------------------------------------------------------
(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN
SHARES ( )
-----------------------------------------------------------------
(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
0.01%
-----------------------------------------------------------------
(14) TYPE OF REPORTING PERSON
IN
-----------------------------------------------------------------
SCHEDULE 13D
CUSIP No. 522008 10 1
-----------------------------------------------------------------
(1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Terrence M. Mullen
-----------------------------------------------------------------
(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP:
(a) ( )
(b) (x)
-----------------------------------------------------------------
(3) SEC USE ONLY
-----------------------------------------------------------------
(4) SOURCE OF FUNDS
OO
-----------------------------------------------------------------
(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) ( )
------------------------------------------------------------------
(6) CITIZENSHIP OR PLACE OF ORGANIZATION
United States
-----------------------------------------------------------------
(7) SOLE VOTING POWER
NUMBER OF 2,440 (See Item 5)
SHARES ___________________________________
BENEFICIALLY (8) SHARED VOTING POWER
OWNED BY
EACH ___________________________________
REPORTING (9) SOLE DISPOSITIVE POWER
PERSON 2,440 (See Item 5)
WITH ___________________________________
(10) SHARED DISPOSITIVE POWER
-----------------------------------------------------------------
(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
2,440 (See Item 5)
-----------------------------------------------------------------
(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN
SHARES ( )
-----------------------------------------------------------------
(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
0.01%
-----------------------------------------------------------------
(14) TYPE OF REPORTING PERSON
IN
-----------------------------------------------------------------
SCHEDULE 13D
CUSIP No. 522008 10 1
-----------------------------------------------------------------
(1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Todd M. Abbrecht
-----------------------------------------------------------------
(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP:
(a) ( )
(b) (x)
-----------------------------------------------------------------
(3) SEC USE ONLY
-----------------------------------------------------------------
(4) SOURCE OF FUNDS
OO
-----------------------------------------------------------------
(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) ( )
------------------------------------------------------------------
(6) CITIZENSHIP OR PLACE OF ORGANIZATION
United States
-----------------------------------------------------------------
(7) SOLE VOTING POWER
NUMBER OF 2,440 (See Item 5)
SHARES ___________________________________
BENEFICIALLY (8) SHARED VOTING POWER
OWNED BY
EACH ___________________________________
REPORTING (9) SOLE DISPOSITIVE POWER
PERSON 2,440 (See Item 5)
WITH ___________________________________
(10) SHARED DISPOSITIVE POWER
-----------------------------------------------------------------
(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
2,440 (See Item 5)
-----------------------------------------------------------------
(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN
SHARES ( )
-----------------------------------------------------------------
(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
0.01%
-----------------------------------------------------------------
(14) TYPE OF REPORTING PERSON
IN
-----------------------------------------------------------------
SCHEDULE 13D
CUSIP No. 522008 10 1
-----------------------------------------------------------------
(1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Wendy L. Masler
-----------------------------------------------------------------
(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP:
(a) ( )
(b) (x)
-----------------------------------------------------------------
(3) SEC USE ONLY
-----------------------------------------------------------------
(4) SOURCE OF FUNDS
OO
-----------------------------------------------------------------
(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) ( )
------------------------------------------------------------------
(6) CITIZENSHIP OR PLACE OF ORGANIZATION
United States
-----------------------------------------------------------------
(7) SOLE VOTING POWER
NUMBER OF 2,440 (See Item 5)
SHARES ___________________________________
BENEFICIALLY (8) SHARED VOTING POWER
OWNED BY
EACH ___________________________________
REPORTING (9) SOLE DISPOSITIVE POWER
PERSON 2,440 (See Item 5)
WITH ___________________________________
(10) SHARED DISPOSITIVE POWER
-----------------------------------------------------------------
(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
2,440 (See Item 5)
-----------------------------------------------------------------
(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN
SHARES ( )
-----------------------------------------------------------------
(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
0.01%
-----------------------------------------------------------------
(14) TYPE OF REPORTING PERSON
IN
-----------------------------------------------------------------
SCHEDULE 13D
CUSIP No. 522008 10 1
-----------------------------------------------------------------
(1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Andrew D. Flaster
-----------------------------------------------------------------
(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP:
(a) ( )
(b) (x)
-----------------------------------------------------------------
(3) SEC USE ONLY
-----------------------------------------------------------------
(4) SOURCE OF FUNDS
OO
-----------------------------------------------------------------
(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) ( )
------------------------------------------------------------------
(6) CITIZENSHIP OR PLACE OF ORGANIZATION
United States
-----------------------------------------------------------------
(7) SOLE VOTING POWER
NUMBER OF 1,220 (See Item 5)
SHARES ___________________________________
BENEFICIALLY (8) SHARED VOTING POWER
OWNED BY 1,220 (See Item 5)
EACH ___________________________________
REPORTING (9) SOLE DISPOSITIVE POWER PERSON
WITH 1,220 (See Item 5)
___________________________________
(10) SHARED DISPOSITIVE POWER
1,220 (See Item 5)
-----------------------------------------------------------------
(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
2,440 (See Item 5)
-----------------------------------------------------------------
(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN
SHARES ( )
-----------------------------------------------------------------
(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
0.01%
-----------------------------------------------------------------
(14) TYPE OF REPORTING PERSON
IN
-----------------------------------------------------------------
SCHEDULE 13D
CUSIP No. 522008 10 1
-----------------------------------------------------------------
(1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Resources Trust Co. FBO. Andrew D. Flaster
-----------------------------------------------------------------
(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP:
(a) ( )
(b) (x)
-----------------------------------------------------------------
(3) SEC USE ONLY
-----------------------------------------------------------------
(4) SOURCE OF FUNDS
OO
-----------------------------------------------------------------
(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) ( )
------------------------------------------------------------------
(6) CITIZENSHIP OR PLACE OF ORGANIZATION
N/A
-----------------------------------------------------------------
(7) SOLE VOTING POWER
NUMBER OF
SHARES ___________________________________
BENEFICIALLY (8) SHARED VOTING POWER
OWNED BY 1,220 (See Item 5)
EACH ___________________________________
REPORTING (9) SOLE DISPOSITIVE POWER
PERSON
WITH ___________________________________
(10) SHARED DISPOSITIVE POWER
1,220 (See Item 5)
-----------------------------------------------------------------
(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
1,220 (See Item 5)
-----------------------------------------------------------------
(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN
SHARES ( )
-----------------------------------------------------------------
(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
0.003%
-----------------------------------------------------------------
(14) TYPE OF REPORTING PERSON
00
-----------------------------------------------------------------
SCHEDULE 13D
CUSIP No. 522008 10 1
-----------------------------------------------------------------
(1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
First Trust Co. FBO Kristina A. Watts
-----------------------------------------------------------------
(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP:
(a) ( )
(b) (x)
-----------------------------------------------------------------
(3) SEC USE ONLY
-----------------------------------------------------------------
(4) SOURCE OF FUNDS
OO
-----------------------------------------------------------------
(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) ( )
------------------------------------------------------------------
(6) CITIZENSHIP OR PLACE OF ORGANIZATION
N/A
-----------------------------------------------------------------
(7) SOLE VOTING POWER
NUMBER OF 2,440 (See Item 5)
SHARES ___________________________________
BENEFICIALLY (8) SHARED VOTING POWER
OWNED BY
EACH ___________________________________
REPORTING (9) SOLE DISPOSITIVE POWER
PERSON 2,440 (See Item 5)
WITH ___________________________________
(10) SHARED DISPOSITIVE POWER
-----------------------------------------------------------------
(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
2,440 (See Item 5)
-----------------------------------------------------------------
(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN
SHARES ( )
-----------------------------------------------------------------
(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
0.01%
-----------------------------------------------------------------
(14) TYPE OF REPORTING PERSON
00
-----------------------------------------------------------------
SCHEDULE 13D
CUSIP No. 522008 10 1
-----------------------------------------------------------------
(1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Andrew T. Mulderry
-----------------------------------------------------------------
(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP:
(a) ( )
(b) (x)
-----------------------------------------------------------------
(3) SEC USE ONLY
-----------------------------------------------------------------
(4) SOURCE OF FUNDS
OO
-----------------------------------------------------------------
(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) ( )
------------------------------------------------------------------
(6) CITIZENSHIP OR PLACE OF ORGANIZATION
United States
-----------------------------------------------------------------
(7) SOLE VOTING POWER
NUMBER OF 1,220 (See Item 5)
SHARES ___________________________________
BENEFICIALLY (8) SHARED VOTING POWER
OWNED BY
EACH ___________________________________
REPORTING (9) SOLE DISPOSITIVE POWER
PERSON 1,220 (See Item 5)
WITH ___________________________________
(10) SHARED DISPOSITIVE POWER
-----------------------------------------------------------------
(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
1,220 (See Item 5)
-----------------------------------------------------------------
(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN
SHARES ( )
-----------------------------------------------------------------
(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
0.003%
-----------------------------------------------------------------
(14) TYPE OF REPORTING PERSON
IN
-----------------------------------------------------------------
SCHEDULE 13D
CUSIP No. 522008 10 1
-----------------------------------------------------------------
(1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
George R. Taylor
-----------------------------------------------------------------
(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP:
(a) ( )
(b) (x)
-----------------------------------------------------------------
(3) SEC USE ONLY
-----------------------------------------------------------------
(4) SOURCE OF FUNDS
OO
-----------------------------------------------------------------
(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) ( )
------------------------------------------------------------------
(6) CITIZENSHIP OR PLACE OF ORGANIZATION
United States
-----------------------------------------------------------------
(7) SOLE VOTING POWER
NUMBER OF 1,220 (See Item 5)
SHARES ___________________________________
BENEFICIALLY (8) SHARED VOTING POWER
OWNED BY
EACH ___________________________________
REPORTING (9) SOLE DISPOSITIVE POWER
PERSON 1,220 (See Item 5)
WITH ___________________________________
(10) SHARED DISPOSITIVE POWER
-----------------------------------------------------------------
(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
1,220 (See Item 5)
-----------------------------------------------------------------
(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN
SHARES ( )
-----------------------------------------------------------------
(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
0.003%
-----------------------------------------------------------------
(14) TYPE OF REPORTING PERSON
IN
-----------------------------------------------------------------
SCHEDULE 13D
CUSIP No. 522008 10 1
-----------------------------------------------------------------
(1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Charles W. Robins
-----------------------------------------------------------------
(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP:
(a) ( )
(b) (x)
-----------------------------------------------------------------
(3) SEC USE ONLY
-----------------------------------------------------------------
(4) SOURCE OF FUNDS
OO
-----------------------------------------------------------------
(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) ( )
------------------------------------------------------------------
(6) CITIZENSHIP OR PLACE OF ORGANIZATION
United States
-----------------------------------------------------------------
(7) SOLE VOTING POWER
NUMBER OF 2,440 (See Item 5)
SHARES ___________________________________
BENEFICIALLY (8) SHARED VOTING POWER
OWNED BY
EACH ___________________________________
REPORTING (9) SOLE DISPOSITIVE POWER
PERSON 2,440 (See Item 5)
WITH ___________________________________
(10) SHARED DISPOSITIVE POWER
-----------------------------------------------------------------
(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
2,440 (See Item 5)
-----------------------------------------------------------------
(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN
SHARES ( )
-----------------------------------------------------------------
(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
0.01%
-----------------------------------------------------------------
(14) TYPE OF REPORTING PERSON
IN
-----------------------------------------------------------------
SCHEDULE 13D
CUSIP No. 522008 10 1
-----------------------------------------------------------------
(1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
James Westra
-----------------------------------------------------------------
(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP:
(a) ( )
(b) (x)
-----------------------------------------------------------------
(3) SEC USE ONLY
-----------------------------------------------------------------
(4) SOURCE OF FUNDS
OO
-----------------------------------------------------------------
(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) ( )
------------------------------------------------------------------
(6) CITIZENSHIP OR PLACE OF ORGANIZATION
United States
-----------------------------------------------------------------
(7) SOLE VOTING POWER
NUMBER OF 2,440 (See Item 5)
SHARES ___________________________________
BENEFICIALLY (8) SHARED VOTING POWER
OWNED BY
EACH ___________________________________
REPORTING (9) SOLE DISPOSITIVE POWER
PERSON 2,440 (See Item 5)
WITH ___________________________________
(10) SHARED DISPOSITIVE POWER
-----------------------------------------------------------------
(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
2,440 (See Item 5)
-----------------------------------------------------------------
(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN
SHARES ( )
-----------------------------------------------------------------
(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
0.01%
-----------------------------------------------------------------
(14) TYPE OF REPORTING PERSON
IN
-----------------------------------------------------------------
SCHEDULE 13D
CUSIP No. 522008 10 1
-----------------------------------------------------------------
(1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Charles A. Brizius
-----------------------------------------------------------------
(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP:
(a) ( )
(b) (x)
-----------------------------------------------------------------
(3) SEC USE ONLY
-----------------------------------------------------------------
(4) SOURCE OF FUNDS
OO
-----------------------------------------------------------------
(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) ( )
------------------------------------------------------------------
(6) CITIZENSHIP OR PLACE OF ORGANIZATION
United States
-----------------------------------------------------------------
(7) SOLE VOTING POWER
NUMBER OF 2,440 (See Item 5)
SHARES ___________________________________
BENEFICIALLY (8) SHARED VOTING POWER
OWNED BY
EACH ___________________________________
REPORTING (9) SOLE DISPOSITIVE POWER
PERSON 2,440 (See Item 5)
WITH ___________________________________
(10) SHARED DISPOSITIVE POWER
-----------------------------------------------------------------
(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
2,440 (See Item 5)
-----------------------------------------------------------------
(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN
SHARES ( )
-----------------------------------------------------------------
(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
0.01%
-----------------------------------------------------------------
(14) TYPE OF REPORTING PERSON
IN
-----------------------------------------------------------------
SCHEDULE 13D
CUSIP No. 522008 10 1
-----------------------------------------------------------------
(1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Jeffrey B. Kovach
-----------------------------------------------------------------
(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP:
(a) ( )
(b) (x)
-----------------------------------------------------------------
(3) SEC USE ONLY
-----------------------------------------------------------------
(4) SOURCE OF FUNDS
OO
-----------------------------------------------------------------
(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) ( )
------------------------------------------------------------------
(6) CITIZENSHIP OR PLACE OF ORGANIZATION
United States
-----------------------------------------------------------------
(7) SOLE VOTING POWER
NUMBER OF 1,220 (See Item 5)
SHARES ___________________________________
BENEFICIALLY (8) SHARED VOTING POWER
OWNED BY
EACH ___________________________________
REPORTING (9) SOLE DISPOSITIVE POWER
PERSON 1,220 (See Item 5)
WITH ___________________________________
(10) SHARED DISPOSITIVE POWER
-----------------------------------------------------------------
(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
1,220 (See Item 5)
-----------------------------------------------------------------
(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN
SHARES ( )
-----------------------------------------------------------------
(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
0.003%
-----------------------------------------------------------------
(14) TYPE OF REPORTING PERSON
IN
-----------------------------------------------------------------
SCHEDULE 13D
CUSIP No. 522008 10 1
-----------------------------------------------------------------
(1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Anjan Mukherjee
-----------------------------------------------------------------
(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP:
(a) ( )
(b) (x)
-----------------------------------------------------------------
(3) SEC USE ONLY
-----------------------------------------------------------------
(4) SOURCE OF FUNDS
OO
-----------------------------------------------------------------
(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) ( )
------------------------------------------------------------------
(6) CITIZENSHIP OR PLACE OF ORGANIZATION
United States
-----------------------------------------------------------------
(7) SOLE VOTING POWER
NUMBER OF 1,220 (See Item 5)
SHARES ___________________________________
BENEFICIALLY (8) SHARED VOTING POWER
OWNED BY
EACH ___________________________________
REPORTING (9) SOLE DISPOSITIVE POWER
PERSON 1,220 (See Item 5)
WITH ___________________________________
(10) SHARED DISPOSITIVE POWER
-----------------------------------------------------------------
(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
1,220 (See Item 5)
-----------------------------------------------------------------
(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN
SHARES ( )
-----------------------------------------------------------------
(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
0.003%
-----------------------------------------------------------------
(14) TYPE OF REPORTING PERSON
IN
-----------------------------------------------------------------
SCHEDULE 13D
CUSIP No. 522008 10 1
-----------------------------------------------------------------
(1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Charles S. Woo
-----------------------------------------------------------------
(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP:
(a) ( )
(b) (x)
-----------------------------------------------------------------
(3) SEC USE ONLY
-----------------------------------------------------------------
(4) SOURCE OF FUNDS
OO
-----------------------------------------------------------------
(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) ( )
------------------------------------------------------------------
(6) CITIZENSHIP OR PLACE OF ORGANIZATION
United States
-----------------------------------------------------------------
(7) SOLE VOTING POWER
NUMBER OF 1,220 (See Item 5)
SHARES ___________________________________
BENEFICIALLY (8) SHARED VOTING POWER
OWNED BY
EACH ___________________________________
REPORTING (9) SOLE DISPOSITIVE POWER
PERSON 1,220 (See Item 5)
WITH ___________________________________
(10) SHARED DISPOSITIVE POWER
-----------------------------------------------------------------
(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
1,220 (See Item 5)
-----------------------------------------------------------------
(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN
SHARES ( )
-----------------------------------------------------------------
(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
0.003%
-----------------------------------------------------------------
(14) TYPE OF REPORTING PERSON
IN
-----------------------------------------------------------------
SCHEDULE 13D
CUSIP No. 522008 10 1
-----------------------------------------------------------------
(1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Bain Capital Fund V, L.P.
-----------------------------------------------------------------
(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP:
(a) ( )
(b) (x)
-----------------------------------------------------------------
(3) SEC USE ONLY
-----------------------------------------------------------------
(4) SOURCE OF FUNDS
OO
-----------------------------------------------------------------
(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) ( )
------------------------------------------------------------------
(6) CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
-----------------------------------------------------------------
(7) SOLE VOTING POWER
NUMBER OF
SHARES ___________________________________
BENEFICIALLY (8) SHARED VOTING POWER
OWNED BY 596,940 (See Item 5)
EACH ___________________________________
REPORTING (9) SOLE DISPOSITIVE POWER
PERSON
WITH ___________________________________
(10) SHARED DISPOSITIVE POWER
596,940 (See Item 5)
-----------------------------------------------------------------
(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
596,940 (See Item 5)
-----------------------------------------------------------------
(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN
SHARES ( )
-----------------------------------------------------------------
(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
1.2%
-----------------------------------------------------------------
(14) TYPE OF REPORTING PERSON
PN
-----------------------------------------------------------------
SCHEDULE 13D
CUSIP No. 522008 10 1
-----------------------------------------------------------------
(1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Bain Capital Fund V-B, L.P.
-----------------------------------------------------------------
(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP:
(a) ( )
(b) (x)
-----------------------------------------------------------------
(3) SEC USE ONLY
-----------------------------------------------------------------
(4) SOURCE OF FUNDS
OO
-----------------------------------------------------------------
(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) ( )
------------------------------------------------------------------
(6) CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
-----------------------------------------------------------------
(7) SOLE VOTING POWER
NUMBER OF
SHARES ___________________________________
BENEFICIALLY (8) SHARED VOTING POWER
OWNED BY 1,554,440 (See Item 5)
EACH ___________________________________
REPORTING (9) SOLE DISPOSITIVE POWER
PERSON
WITH ___________________________________
(10) SHARED DISPOSITIVE POWER
1,554,440 (See Item 5)
-----------------------------------------------------------------
(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
1,554,440 (See Item 5)
-----------------------------------------------------------------
(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN
SHARES ( )
-----------------------------------------------------------------
(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
3.1%
-----------------------------------------------------------------
(14) TYPE OF REPORTING PERSON
PN
-----------------------------------------------------------------
SCHEDULE 13D
CUSIP No. 522008 10 1
-----------------------------------------------------------------
(1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Bain Capital Partners V, L.P.
-----------------------------------------------------------------
(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP:
(a) ( )
(b) (x)
-----------------------------------------------------------------
(3) SEC USE ONLY
-----------------------------------------------------------------
(4) SOURCE OF FUNDS
N/A
-----------------------------------------------------------------
(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) ( )
------------------------------------------------------------------
(6) CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
-----------------------------------------------------------------
(7) SOLE VOTING POWER
NUMBER OF
SHARES ___________________________________
BENEFICIALLY (8) SHARED VOTING POWER
OWNED BY 2,151,380 (See Item 5)
EACH ___________________________________
REPORTING (9) SOLE DISPOSITIVE POWER
PERSON
WITH ___________________________________
(10) SHARED DISPOSITIVE POWER
2,151,380 (See Item 5)
-----------------------------------------------------------------
(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
2,151,380 (See Item 5)
-----------------------------------------------------------------
(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN
SHARES ( )
-----------------------------------------------------------------
(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
4.3%
-----------------------------------------------------------------
(14) TYPE OF REPORTING PERSON
PN
-----------------------------------------------------------------
SCHEDULE 13D
CUSIP No. 522008 10 1
-----------------------------------------------------------------
(1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Bain Capital Investors V, Inc.
-----------------------------------------------------------------
(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP:
(a) ( )
(b) (x)
-----------------------------------------------------------------
(3) SEC USE ONLY
-----------------------------------------------------------------
(4) SOURCE OF FUNDS
N/A
-----------------------------------------------------------------
(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) ( )
------------------------------------------------------------------
(6) CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
-----------------------------------------------------------------
(7) SOLE VOTING POWER
NUMBER OF
SHARES ___________________________________
BENEFICIALLY (8) SHARED VOTING POWER
OWNED BY 2,151,380 (See Item 5)
EACH ___________________________________
REPORTING (9) SOLE DISPOSITIVE POWER
PERSON
WITH ___________________________________
(10) SHARED DISPOSITIVE POWER
2,151,380 (See Item 5)
-----------------------------------------------------------------
(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
2,151,380 (See Item 5)
-----------------------------------------------------------------
(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN
SHARES ( )
-----------------------------------------------------------------
(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
4.3%
-----------------------------------------------------------------
(14) TYPE OF REPORTING PERSON
CO
-----------------------------------------------------------------
SCHEDULE 13D
CUSIP No. 522008 10 1
-----------------------------------------------------------------
(1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
BCIP Associates, L.P.
-----------------------------------------------------------------
(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP:
(a) ( )
(b) (x)
-----------------------------------------------------------------
(3) SEC USE ONLY
-----------------------------------------------------------------
(4) SOURCE OF FUNDS
OO
-----------------------------------------------------------------
(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) ( )
------------------------------------------------------------------
(6) CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
-----------------------------------------------------------------
(7) SOLE VOTING POWER
NUMBER OF
SHARES ___________________________________
BENEFICIALLY (8) SHARED VOTING POWER
OWNED BY 759,720 (See Item 5)
EACH ___________________________________
REPORTING (9) SOLE DISPOSITIVE POWER
PERSON
WITH ___________________________________
(10) SHARED DISPOSITIVE POWER
759,720 (See Item 5)
-----------------------------------------------------------------
(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
759,720 (See Item 5)
-----------------------------------------------------------------
(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN
SHARES ( )
-----------------------------------------------------------------
(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
1.6%
-----------------------------------------------------------------
(14) TYPE OF REPORTING PERSON
PN
-----------------------------------------------------------------
SCHEDULE 13D
CUSIP No. 522008 10 1
-----------------------------------------------------------------
(1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
BCIP Trust Associates, L.P.
-----------------------------------------------------------------
(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP:
(a) ( )
(b) (x)
-----------------------------------------------------------------
(3) SEC USE ONLY
-----------------------------------------------------------------
(4) SOURCE OF FUNDS
OO
-----------------------------------------------------------------
(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) ( )
------------------------------------------------------------------
(6) CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
-----------------------------------------------------------------
(7) SOLE VOTING POWER
NUMBER OF
SHARES ___________________________________
BENEFICIALLY (8) SHARED VOTING POWER
OWNED BY 137,700 (See Item 5)
EACH ___________________________________
REPORTING (9) SOLE DISPOSITIVE POWER
PERSON
WITH ___________________________________
(10) SHARED DISPOSITIVE POWER
137,700 (See Item 5)
-----------------------------------------------------------------
(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
137,700 (See Item 5)
-----------------------------------------------------------------
(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN
SHARES ( )
-----------------------------------------------------------------
(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
0.3%
-----------------------------------------------------------------
(14) TYPE OF REPORTING PERSON
PN
-----------------------------------------------------------------
SCHEDULE 13D
CUSIP No. 522008 10 1
-----------------------------------------------------------------
(1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
W. Mitt Romney
-----------------------------------------------------------------
(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP:
(a) ( )
(b) (x)
-----------------------------------------------------------------
(3) SEC USE ONLY
-----------------------------------------------------------------
(4) SOURCE OF FUNDS
N/A
-----------------------------------------------------------------
(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) ( )
------------------------------------------------------------------
(6) CITIZENSHIP OR PLACE OF ORGANIZATION
United States
-----------------------------------------------------------------
(7) SOLE VOTING POWER
NUMBER OF
SHARES ___________________________________
BENEFICIALLY (8) SHARED VOTING POWER
OWNED BY 3,414,640 (See Item 5)
EACH ___________________________________
REPORTING (9) SOLE DISPOSITIVE POWER
PERSON
WITH ___________________________________
(10) SHARED DISPOSITIVE POWER
3,414,640 (See Item 5)
-----------------------------------------------------------------
(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
3,414,640 (See Item 5)
-----------------------------------------------------------------
(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN
SHARES ( )
-----------------------------------------------------------------
(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
6.6%
-----------------------------------------------------------------
(14) TYPE OF REPORTING PERSON
IN
-----------------------------------------------------------------
SCHEDULE 13D
CUSIP No. 522008 10 1
-----------------------------------------------------------------
(1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Joshua Bekenstein
-----------------------------------------------------------------
(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP:
(a) ( )
(b) (x)
-----------------------------------------------------------------
(3) SEC USE ONLY
-----------------------------------------------------------------
(4) SOURCE OF FUNDS
N/A
-----------------------------------------------------------------
(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) ( )
------------------------------------------------------------------
(6) CITIZENSHIP OR PLACE OF ORGANIZATION
United States
-----------------------------------------------------------------
(7) SOLE VOTING POWER
NUMBER OF
SHARES ___________________________________
BENEFICIALLY (8) SHARED VOTING POWER
OWNED BY 897,420 (See Item 5)
EACH ___________________________________
REPORTING (9) SOLE DISPOSITIVE POWER
PERSON
WITH ___________________________________
(10) SHARED DISPOSITIVE POWER
897,420 (See Item 5)
-----------------------------------------------------------------
(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
897,420 (See Item 5)
-----------------------------------------------------------------
(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN
SHARES ( )
-----------------------------------------------------------------
(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
1.8%
-----------------------------------------------------------------
(14) TYPE OF REPORTING PERSON
IN
-----------------------------------------------------------------
SCHEDULE 13D
CUSIP No. 522008 10 1
-----------------------------------------------------------------
(1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Brookside Capital Partners Fund, L.P.
-----------------------------------------------------------------
(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP:
(a) ( )
(b) (x)
-----------------------------------------------------------------
(3) SEC USE ONLY
-----------------------------------------------------------------
(4) SOURCE OF FUNDS
00
-----------------------------------------------------------------
(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) ( )
------------------------------------------------------------------
(6) CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
-----------------------------------------------------------------
(7) SOLE VOTING POWER
NUMBER OF
SHARES ___________________________________
BENEFICIALLY (8) SHARED VOTING POWER
OWNED BY 365,840 (See Item 5)
EACH ___________________________________
REPORTING (9) SOLE DISPOSITIVE POWER
PERSON
WITH ___________________________________
(10) SHARED DISPOSITIVE POWER
365,840 (See Item 5)
-----------------------------------------------------------------
(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
365,840 (See Item 5)
-----------------------------------------------------------------
(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN
SHARES ( )
-----------------------------------------------------------------
(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
0.8%
-----------------------------------------------------------------
(14) TYPE OF REPORTING PERSON
PN
-----------------------------------------------------------------
SCHEDULE 13D
CUSIP No. 522008 10 1
-----------------------------------------------------------------
(1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Brookside Capital Partners, L.P.
-----------------------------------------------------------------
(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP:
(a) ( )
(b) (x)
-----------------------------------------------------------------
(3) SEC USE ONLY
-----------------------------------------------------------------
(4) SOURCE OF FUNDS
N/A
-----------------------------------------------------------------
(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) ( )
------------------------------------------------------------------
(6) CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
-----------------------------------------------------------------
(7) SOLE VOTING POWER
NUMBER OF
SHARES ___________________________________
BENEFICIALLY (8) SHARED VOTING POWER
OWNED BY 365,840 (See Item 5)
EACH ___________________________________
REPORTING (9) SOLE DISPOSITIVE POWER
PERSON
WITH ___________________________________
(10) SHARED DISPOSITIVE POWER
365,840 (See Item 5)
-----------------------------------------------------------------
(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
365,840 (See Item 5)
-----------------------------------------------------------------
(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN
SHARES ( )
-----------------------------------------------------------------
(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
0.8%
-----------------------------------------------------------------
(14) TYPE OF REPORTING PERSON
PN
-----------------------------------------------------------------
SCHEDULE 13D
CUSIP No. 522008 10 1
-----------------------------------------------------------------
(1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Brookside Capital Investors, Inc.
-----------------------------------------------------------------
(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP:
(a) ( )
(b) (x)
-----------------------------------------------------------------
(3) SEC USE ONLY
-----------------------------------------------------------------
(4) SOURCE OF FUNDS
N/A
-----------------------------------------------------------------
(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) ( )
------------------------------------------------------------------
(6) CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
-----------------------------------------------------------------
(7) SOLE VOTING POWER
NUMBER OF
SHARES ___________________________________
BENEFICIALLY (8) SHARED VOTING POWER
OWNED BY 365,840 (See Item 5)
EACH ___________________________________
REPORTING (9) SOLE DISPOSITIVE POWER
PERSON
WITH ___________________________________
(10) SHARED DISPOSITIVE POWER
365,840 (See Item 5)
-----------------------------------------------------------------
(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
365,840 (See Item 5)
-----------------------------------------------------------------
(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN
SHARES ( )
-----------------------------------------------------------------
(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
0.8%
-----------------------------------------------------------------
(14) TYPE OF REPORTING PERSON
CO
-----------------------------------------------------------------
SCHEDULE 13D
CUSIP No. 522008 10 1
-----------------------------------------------------------------
(1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Centre Capital Investors II, L.P.
-----------------------------------------------------------------
(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP:
(a) ( )
(b) (x)
-----------------------------------------------------------------
(3) SEC USE ONLY
-----------------------------------------------------------------
(4) SOURCE OF FUNDS
OO
-----------------------------------------------------------------
(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) ( )
------------------------------------------------------------------
(6) CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
-----------------------------------------------------------------
(7) SOLE VOTING POWER
NUMBER OF
SHARES ___________________________________
BENEFICIALLY (8) SHARED VOTING POWER
OWNED BY 746,880 (See Item 5)
EACH ___________________________________
REPORTING (9) SOLE DISPOSITIVE POWER
PERSON
WITH ___________________________________
(10) SHARED DISPOSITIVE POWER
746,880 (See Item 5)
-----------------------------------------------------------------
(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
746,880 (See Item 5)
-----------------------------------------------------------------
(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN
SHARES ( )
-----------------------------------------------------------------
(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
1.5%
-----------------------------------------------------------------
(14) TYPE OF REPORTING PERSON
PN
-----------------------------------------------------------------
SCHEDULE 13D
CUSIP No. 522008 10 1
-----------------------------------------------------------------
(1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Centre Capital Tax-Exempt Investors II, L.P.
-----------------------------------------------------------------
(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP:
(a) ( )
(b) (x)
-----------------------------------------------------------------
(3) SEC USE ONLY
-----------------------------------------------------------------
(4) SOURCE OF FUNDS
OO
-----------------------------------------------------------------
(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) ( )
------------------------------------------------------------------
(6) CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
-----------------------------------------------------------------
(7) SOLE VOTING POWER
NUMBER OF
SHARES ___________________________________
BENEFICIALLY (8) SHARED VOTING POWER
OWNED BY 243,040 (See Item 5)
EACH ___________________________________
REPORTING (9) SOLE DISPOSITIVE POWER
PERSON
WITH ___________________________________
(10) SHARED DISPOSITIVE POWER
243,040 (See Item 5)
-----------------------------------------------------------------
(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
243,040 (See Item 5)
-----------------------------------------------------------------
(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN
SHARES ( )
-----------------------------------------------------------------
(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
0.5%
-----------------------------------------------------------------
(14) TYPE OF REPORTING PERSON
PN
-----------------------------------------------------------------
SCHEDULE 13D
CUSIP No. 522008 10 1
-----------------------------------------------------------------
(1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Centre Capital Offshore Investors II, L.P.
-----------------------------------------------------------------
(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP:
(a) ( )
(b) (x)
-----------------------------------------------------------------
(3) SEC USE ONLY
-----------------------------------------------------------------
(4) SOURCE OF FUNDS
OO
-----------------------------------------------------------------
(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) ( )
------------------------------------------------------------------
(6) CITIZENSHIP OR PLACE OF ORGANIZATION
Bermuda
-----------------------------------------------------------------
(7) SOLE VOTING POWER
NUMBER OF
SHARES ___________________________________
BENEFICIALLY (8) SHARED VOTING POWER
OWNED BY 149,840 (See Items)
EACH ___________________________________
REPORTING (9) SOLE DISPOSITIVE POWER
PERSON
WITH ___________________________________
(10) SHARED DISPOSITIVE POWER
149,840 (See Items)
-----------------------------------------------------------------
(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
149,840 (See Item 5)
-----------------------------------------------------------------
(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN
SHARES ( )
-----------------------------------------------------------------
(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
0.3%
-----------------------------------------------------------------
(14) TYPE OF REPORTING PERSON
PN
-----------------------------------------------------------------
SCHEDULE 13D
CUSIP No. 522008 10 1
-----------------------------------------------------------------
(1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Centre Partners II, L.P.
-----------------------------------------------------------------
(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP:
(a) ( )
(b) (x)
-----------------------------------------------------------------
(3) SEC USE ONLY
-----------------------------------------------------------------
(4) SOURCE OF FUNDS
N/A
-----------------------------------------------------------------
(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) ( )
------------------------------------------------------------------
(6) CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
-----------------------------------------------------------------
(7) SOLE VOTING POWER
NUMBER OF
SHARES ___________________________________
BENEFICIALLY (8) SHARED VOTING POWER
OWNED BY 1,139,760 (See Item 5)
EACH ___________________________________
REPORTING (9) SOLE DISPOSITIVE POWER
PERSON
WITH ___________________________________
(10) SHARED DISPOSITIVE POWER
1,139,760 (See Item 5)
-----------------------------------------------------------------
(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
1,139,760 (See Item 5)
-----------------------------------------------------------------
(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN
SHARES ( )
-----------------------------------------------------------------
(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
2.3%
-----------------------------------------------------------------
(14) TYPE OF REPORTING PERSON
PN
-----------------------------------------------------------------
SCHEDULE 13D
CUSIP No. 522008 10 1
-----------------------------------------------------------------
(1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Centre Partners Management LLC
-----------------------------------------------------------------
(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP:
(a) ( )
(b) (x)
-----------------------------------------------------------------
(3) SEC USE ONLY
-----------------------------------------------------------------
(4) SOURCE OF FUNDS
N/A
-----------------------------------------------------------------
(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) ( )
------------------------------------------------------------------
(6) CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
-----------------------------------------------------------------
(7) SOLE VOTING POWER
NUMBER OF
SHARES ___________________________________
BENEFICIALLY (8) SHARED VOTING POWER
OWNED BY 2,273,960 (See Item 5)
EACH ___________________________________
REPORTING (9) SOLE DISPOSITIVE POWER
PERSON
WITH ___________________________________
(10) SHARED DISPOSITIVE POWER
2,273,960 (See Item 5)
-----------------------------------------------------------------
(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
2,273,960 (See Item 5)
-----------------------------------------------------------------
(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN
SHARES ( )
-----------------------------------------------------------------
(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
4.5%
-----------------------------------------------------------------
(14) TYPE OF REPORTING PERSON
00
-----------------------------------------------------------------
SCHEDULE 13D
CUSIP No. 522008 10 1
-----------------------------------------------------------------
(1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
State Board of Administration of Florida
-----------------------------------------------------------------
(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP:
(a) ( )
(b) (x)
-----------------------------------------------------------------
(3) SEC USE ONLY
-----------------------------------------------------------------
(4) SOURCE OF FUNDS
OO
-----------------------------------------------------------------
(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) ( )
------------------------------------------------------------------
(6) CITIZENSHIP OR PLACE OF ORGANIZATION
Florida
-----------------------------------------------------------------
(7) SOLE VOTING POWER
NUMBER OF
SHARES ___________________________________
BENEFICIALLY (8) SHARED VOTING POWER
OWNED BY 1,134,200 (See Item 5)
EACH ___________________________________
REPORTING (9) SOLE DISPOSITIVE POWER
PERSON
WITH ___________________________________
(10) SHARED DISPOSITIVE POWER
1,134,200 (See Item 5)
-----------------------------------------------------------------
(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
1,134,200 (See Item 5)
-----------------------------------------------------------------
(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN
SHARES ( )
-----------------------------------------------------------------
(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
2.3%
-----------------------------------------------------------------
(14) TYPE OF REPORTING PERSON
00
-----------------------------------------------------------------
SCHEDULE 13D
CUSIP No. 522008 10 1
-----------------------------------------------------------------
(1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Centre Parallel Management Partners, L.P.
-----------------------------------------------------------------
(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP:
(a) ( )
(b) (x)
-----------------------------------------------------------------
(3) SEC USE ONLY
-----------------------------------------------------------------
(4) SOURCE OF FUNDS
00
-----------------------------------------------------------------
(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) ( )
------------------------------------------------------------------
(6) CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
-----------------------------------------------------------------
(7) SOLE VOTING POWER
NUMBER OF
SHARES ___________________________________
BENEFICIALLY (8) SHARED VOTING POWER
OWNED BY 1,145,660 (See Item 5)
EACH ___________________________________
REPORTING (9) SOLE DISPOSITIVE POWER
PERSON
WITH ___________________________________
(10) SHARED DISPOSITIVE POWER
1,145,660 (See Item 5)
-----------------------------------------------------------------
(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
1,145,660 (See Item 5)
-----------------------------------------------------------------
(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN
SHARES ( )
-----------------------------------------------------------------
(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
2.3%
-----------------------------------------------------------------
(14) TYPE OF REPORTING PERSON
PN
-----------------------------------------------------------------
SCHEDULE 13D
CUSIP No. 522008 10 1
-----------------------------------------------------------------
(1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Centre Partners Coinvestment, L.P.
-----------------------------------------------------------------
(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP:
(a) ( )
(b) (x)
-----------------------------------------------------------------
(3) SEC USE ONLY
-----------------------------------------------------------------
(4) SOURCE OF FUNDS
OO
-----------------------------------------------------------------
(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) ( )
------------------------------------------------------------------
(6) CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
-----------------------------------------------------------------
(7) SOLE VOTING POWER
NUMBER OF
SHARES ___________________________________
BENEFICIALLY (8) SHARED VOTING POWER
OWNED BY 153,600 (See Item 5)
EACH ___________________________________
REPORTING (9) SOLE DISPOSITIVE POWER
PERSON
WITH ___________________________________
(10) SHARED DISPOSITIVE POWER
153,600 (See Item 5)
-----------------------------------------------------------------
(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
153,600 (See Item 5)
-----------------------------------------------------------------
(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN
SHARES ( )
-----------------------------------------------------------------
(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
0.3%
-----------------------------------------------------------------
(14) TYPE OF REPORTING PERSON
PN
-----------------------------------------------------------------
SCHEDULE 13D
CUSIP No. 522008 10 1
-----------------------------------------------------------------
(1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Centre Partners II LLC
-----------------------------------------------------------------
(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP:
(a) ( )
(b) (x)
-----------------------------------------------------------------
(3) SEC USE ONLY
-----------------------------------------------------------------
(4) SOURCE OF FUNDS
N/A
-----------------------------------------------------------------
(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) ( )
------------------------------------------------------------------
(6) CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
-----------------------------------------------------------------
(7) SOLE VOTING POWER
NUMBER OF
SHARES ___________________________________
BENEFICIALLY (8) SHARED VOTING POWER
OWNED BY 2,439,020 (See Item 5)
EACH ___________________________________
REPORTING (9) SOLE DISPOSITIVE POWER
PERSON
WITH ___________________________________
(10) SHARED DISPOSITIVE POWER
2,439,020 (See Item 5)
-----------------------------------------------------------------
(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
2,439,020 (See Item 5)
-----------------------------------------------------------------
(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN
SHARES ( )
-----------------------------------------------------------------
(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
4.8%
-----------------------------------------------------------------
(14) TYPE OF REPORTING PERSON
00
-----------------------------------------------------------------
ITEM 1. SECURITY AND ISSUER.
The class of equity securities to which this statement
relates is the common stock, $0.01 par value per share (the "Common
Stock"), of The Learning Company, Inc. ("TLC" or the "Company"). The
principal executive offices of TLC are located at One Athenaeum Street,
Cambridge, Massachusetts 02142.
ITEM 2. IDENTITY AND BACKGROUND.
(a) - (c) and (f)
This statement is being jointly filed by the following
persons (collectively, the "Reporting Persons") pursuant to Rule
13d-(1)(f) of the Securities and Exchange Act of 1934, as amended (the
"Exchange Act"):
(1) Thomas H. Lee Equity Fund III, L.P., a Delaware limited
partnership ("Equity Fund III"), by virtue of its direct benefi-
cial ownership of 392,342 shares of Series A Convertible Parti-
cipating Preferred Stock, par value $.01 per share, of the Company
("Preferred Stock").
(2) Thomas H. Lee Foreign Fund III, L.P., a Delaware limited
partnership ("Foreign Fund III"), by virtue of its direct benefi-
cial ownership of 24,277 shares of Preferred Stock;
(3) THL Equity Advisors III Limited Partnership, a
Massachusetts limited partnership ("Advisors III"), as sole general
partner of Equity Fund III and Foreign Fund III;
(4) THL Equity Trust III, a Massachusetts business trust ("Trust
III"), as sole general partner of Advisors III;
(5) THL-CCI Limited Partnership, a Massachusetts Limited Part-
nership ("THL-CCI"), by virtue of its direct beneficial ownership
of 23,585 shares of Preferred Stock;
(6) THL Investment Management Corp., a Massachusetts corporation
("THL Investment"), as sole general partner of THL-CCI;
(7) The persons or entities listed on Schedule I to this Schedule
13D (the "Additional Lee Investors" and, together with Equity Fund
III, Foreign Fund III, Advisors III, Trust III, THL-CCI and THL
Investment, the "Lee Reporting Persons"), by virtue of their direct
beneficial ownership of an aggregate of 17,113 shares of Preferred
Stock;
(8) Bain Capital Fund V, L.P., a Delaware limited partnership
("BCF-V"), by virtue of its direct beneficial ownership of 29,847
shares of Preferred Stock;
(9) Bain Capital Fund V-B, L.P., a Delaware limited partnership
("BCF-V-B"), by virtue of its direct beneficial ownership of 77,722
shares of Preferred Stock;
(10) Bain Capital Partners V, L.P., a Delaware limited partnership
("BCP"), as sole general partner of BCF-V and BCF-V-B;
(11) Bain Capital Investors V, Inc., a Delaware corporation
("BCI"), as sole general partner of BCP;
(12) BCIP Associates, L.P., a Delaware limited partnership
("BCIP"), by virtue of its direct beneficial ownership of 37,986
shares of Preferred Stock;
(13) BCIP Trust Associates, L.P., a Delaware limited partnership
("BCIPT"), by virtue of its direct beneficial ownership of 6,885
shares of Preferred Stock;
(14) W. Mitt Romney, an individual ("Mr. Romney"), as sole
shareholder of BCI and Brookside Investors (as defined below) and
as a member of the Management Committee of BCIP and BCIPT;
(15) Joshua Bekenstein, an individual ("Mr. Bekenstein"), as a
member of the Management Committee of BCIP and BCIPT;
(16) Brookside Capital Partners Fund, L.P., a Delaware limited
partnership ("Brookside Fund"), by virtue of its direct beneficial
ownership of 18,292 shares of Preferred Stock;
(17) Brookside Capital Partners, L.P., a Delaware limited
partnership ("Brookside Partners"), as sole general partner of
Brookside Fund;
(18) Brookside Capital Investors, Inc., a Delaware corporation
("Brookside Investors" and, together with BCF-V, BCF-V-B, BCP,
BCI, BCIP, BCIPT, Mr. Romney, Mr. Bekenstein, Brookside Fund and
Brookside Partners, the "Bain Reporting Persons"), as sole
general partner of Brookside Partners;
(19) Centre Capital Investors, II, L.P., a Delaware limited
partnership ("CCI"), by virtue of its direct beneficial ownership
of 37,344 shares of Preferred Stock;
(20) Centre Capital Tax-Exempt Investors II, L.P., a Delaware
limited partnership ("CCTI"), by virtue of its direct beneficial
ownership of 12,152 shares of Preferred Stock;
(21) Centre Capital Offshore Investors II, L.P., a Bermuda limited
partnership ("CCOI"), by virtue of its direct beneficial ownership
of 7,492 shares of Preferred Stock;
(22) Centre Partners II, L.P., a Delaware limited partnership
("CPLP"), as sole general partner of each of CCI, CCTI and CCOI;
(23) Centre Partners Management LLC, a Delaware limited liability
company ("CPM"), as manager of CPLP and CPMP (in its capacity as
manager for certain funds of Florida Board);
(24) State Board of Administration of Florida, a body corporate
organized under the constitution of the State of Florida ("Florida
Board"), by virtue of its direct beneficial ownership of 56,710
shares of Preferred Stock;
(25) Centre Parallel Management Partners, L.P., a Delaware limited
partnership ("CPMP"), by virtue of its direct beneficial ownership
of 573 shares of Preferred Stock and as the manager for certain
funds of Florida Board;
(26) Centre Partners Coinvestment, L.P., a Delaware limited
partnership ("CPC"), by virtue of its direct beneficial ownership
of 7,680 shares of Preferred Stock; and
(27) Centre Partners II LLC, a Delaware limited liability company
("CPLLC" and, together with CCI, CCTI, CCOI, CPLP, CPM, Florida
Board, CPMP and CPC, the "Centre Reporting Persons"), as sole
general partner of CPMP, CPC and CPLP.
The Reporting Persons have entered into a Joint Filing
Agreement dated December 12, 1997, a copy of which is attached hereto as
Exhibit A and incorporated herein by reference, pursuant to which the
Reporting Persons have agreed to file this statement jointly in
accordance with the provisions of Rule 13d-1(f)(1) under the Exchange
Act.
The address of each of the Lee Reporting Persons, other than
certain Additional Lee Investors as indicated on Schedule 1 hereto, is
c/o Thomas H. Lee Company ("THL Co."), 75 State Street, Boston,
Massachusetts 02109.
The address of each of the Bain Reporting Persons is c/o Bain
Capital, Inc., Two Copley Place, Boston, Massachusetts 02116.
The address of each of the Centre Reporting Persons is c/o Centre
Partners Management LLC, 30 Rockefeller Plaza, Suite 5050, New York, New
York 10020.
Each of Equity Fund III, Foreign Fund III and THL-CCI are
principally engaged in the business of investing in securities. Advisors
III is principally engaged in the business of serving as general partner
of Equity Fund III and Foreign Fund III. Trust III is principally engaged
in the business of serving as general partner of Advisors III. THL
Investment is principally engaged in the business of serving as general
partner of THL-CCI. The Additional THL Investors, other than certain
Additional Lee Investors as indicated on Schedule 1 hereto, are employed
by THL Co.
Attached as Schedule II-A to this Schedule 13D is information
concerning the Lee Reporting Persons and other persons as to which such
information is required to be disclosed in response to Item 2 and General
Instruction C to Schedule 13D.
Each of BCF-V, BCF-V-B, BCIP, BCIPT and Brookside Fund are
principally engaged in the business of investing in securities. BCP is
principally engaged in the business of serving as general partner of each
of BCF-V and BCF-V-B. BCI is principally engaged in the business of
serving as general partner of BCP. Mr. Romney is principally engaged in
the business of serving as sole shareholder of BCI and Brookside
Investors and as a member of the Management Committee of BCIP and BCIPT.
Mr. Bekenstein is principally engaged in the business of serving as a
member of the Management Committee of BCIP and BCIPT. Brookside Partners
is principally engaged in the business of serving as general partner of
Brookside Fund. Brookside Investors is principally engaged in the
business of serving as general partner of Brookside Partners.
Attached as Schedule II-B to this Schedule 13D is information
concerning the Bain Reporting Persons and other persons as to which such
information is required to be disclosed in response to Item 2 and General
Instruction C to Schedule 13D.
Each of CCI, CCTI, CCOI, CPMP and CPC are principally engaged
in the business of investing in securities. CPMP is also engaged in the
business of serving as a manager for certain funds of Florida Board.
Florida Board is engaged principally in investing certain funds on behalf
of the State of Florida. CPLP is principally engaged in the business of
serving as general partner of each of CCI, CCTI and CCOI. CPLLC is
principally engaged in the business of serving as general partner of
CPMP, CPC and CPLP. CPM is principally engaged in the business of serving
as manager of CPLP and CPMP (in its capacity as manager for certain funds
of Florida Board).
Attached as Schedule II-C to this Schedule 13D is information
concerning the Centre Reporting Persons and other persons as to which
such information is required to be disclosed in response to Item 2 and
General Instruction C to Schedule 13D.
(d) None of the Reporting Persons or any of their executive officers,
directors or trustees have been convicted in a criminal proceeding
(exclud ing traffic violations or similar misdemeanors) during the last
five years.
(e) None of the Reporting Persons or any of their executive officers,
directors or trustees have been a party to a civil proceeding of a
judicial or administrative body of competent jurisdiction during the last
five years as a result of which any such persons was or is subject to a
judgment, decree or final order enjoining future violations of, or
prohibiting or mandating activities subject to, federal or state
securities laws or finding any violation with respect to such laws.
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
Pursuant to a Securities Purchase Agreement dated as of
August 26, 1997, as amended as of September 16, 1997 (the "Lee Purchase
Agreement"), a copy of which is attached hereto as Exhibit B-1 and is
incorpo rated herein by reference, by and among TLC, Equity Fund III,
Foreign Fund III and THL Co. (Equity Fund III, Foreign Fund III and THL
Co. are collectively referred to as the "Lee Purchasers"), TLC agreed
to sell to the Lee Purchasers an aggregate of 457,317 shares of
Preferred Stock in exchange for (i) the surrender of TLC's 5 1/2%
Senior Convertible/Exchangeable Notes due 2000 (the "Notes") in an
aggregate principal amount of $91,463,400 and (ii) a cash payment by TLC
to the Lee Purchasers in an aggregate amount equal to approximately
$489,075. As of December 4, 1997, THL Co. assigned its rights and
obligations under the Lee Purchase Agreement to THL-CCI and the
Additional Lee Investors (such persons and entities shall hereinafter,
unless the context otherwise requires, also be referred to as the Lee
Purchasers and THL Co. shall hereinafter, unless the context otherwise
requires, not be referred to as a Lee Purchaser). The Preferred Stock
held by the Lee Purchasers is currently convertible into 9,146,340 shares
of Common Stock.
Pursuant to a Securities Purchase Agreement dated as of
August 26, 1997, as amended as of September 16, 1997 (the "Bain Purchase
Agreement"), a copy of which is attached hereto as Exhibit B-2 and is
incorpo rated herein by reference, by and among TLC, BCF-V, BCF-V-B, BCIP
and BCIPT (BCF-V, BCF-V-B, BCIP and BCIPT are collectively referred to as
the "Bain Purchasers"), TLC agreed to sell to the Bain Purchasers an
aggregate of 170,732 shares of Preferred Stock in exchange for (i) the
surrender of Notes in an aggregate principal amount of $34,146,400 and
(ii) a cash payment by TLC to the Bain Purchasers in an aggregate amount
equal to approximately $182,588. As of December 4, 1997, BCF-V assigned
certain of its rights and obligations under the Bain Purchase Agreement
to Brookside Fund (Brookside Fund shall hereinafter, unless the context
otherwise requires, also be referred to as a Bain Purchaser). The Preferred
Stock held by the Bain Purchasers is currently convertible into 3,414,640
shares of Common Stock.
Pursuant to a Securities Purchase Agreement dated as of
August 26, 1997, as amended as of September 16, 1997 (the "Centre
Purchase Agreement" and, together with the Lee Purchase Agreement and the
Bain Purchase Agreement, the "Purchase Agreements"), a copy of which is
attached hereto as Exhibit B-3 and is incorporated herein by reference,
by and among TLC, CCI, CCTI, CCOI, Florida Board, CPMP and CPC (CCI,
CCTI, CCOI, Florida Board, CPMP and CPC are collectively referred to as
the "Centre Purchasers" and, together with the Lee Purchasers and the
Bain Purchasers, the "Purchasers"), TLC agreed to sell to the Centre
Purchasers an aggregate of 121,951 shares of Preferred Stock in exchange
for (i) the surrender of Notes in an aggregate principal amount of
$24,390,200 and (ii) a cash payment by TLC to the Centre Purchasers in an
aggregate amount equal to approximately $130,420. The Preferred Stock
held by the Centre Purchasers is currently convertible into 2,439,020
shares of Common Stock.
The Purchasers acquired the Notes pursuant to a Securities
Purchase Agreement dated as of August 26, 1997 (the "Tribune Purchase
Agreement"), a copy of which is attached hereto as Exhibit C and is
incorporated herein by reference, by and among Tribune Company, the Lee
Purchasers (including THL Co. but excluding THL-CCI and the Additional
Lee Investors), the Bain Purchasers (excluding Brookside Fund) and the
Centre Purchasers. Pursuant to the Tribune Purchase Agreement, the Lee
Purchas ers, Bain Purchasers and Centre Purchasers agreed to pay an
aggregate of $123 million ($75 million, $28 million and $20 million,
respectively) to Tribune Company in exchange for Notes in an aggregate
principal amount of $150 million.
Of the $75 million paid by the Lee Purchasers to purchase the
Notes, the following amounts were paid by each of the Lee Purchasers: (i)
approximately $64.34 million by Equity Fund III; (ii) approximately $3.98
million by Foreign Fund III; (iii) approximately $3.87 million by
THL-CCI; and (iv) approximately $2.81 million by the Additional Lee
Investors. The Lee Purchasers (other than the Additional Lee Investors)
obtained funds to purchase the Notes through capital contributions from
their investors. The Additional Lee Investors obtained funds to purchase
the Notes from their personal accounts.
Of the $28 million paid by the Bain Purchasers to purchase
the Notes, the following amounts were paid by each of the Bain
Purchasers: (i) approximately $4.89 million by BCF-V; (ii) approximately
$12.75 million by BCF-V-B; (iii) approximately $6.23 million by BCIP;
(iv) approximately $1.13 million by BCIPT; and (v) approximately $3.0
million by Brookside Fund. The Bain Purchasers obtained funds to purchase
the Notes through capital contributions from their investors.
Of the $20 million paid by the Centre Purchasers to purchase
the Notes, the following amounts were paid by each of the Centre
Purchasers: (i) approximately $6.12 million by CCI; (ii) approximately
$1.99 million by CCTI; (iii) approximately $1.23 million by CCOI; (iv)
approximately $9.30 million by Florida Board; (v) approximately $0.09
million by CPMP; and (vi) approximately $1.26 million by CPC. The Centre
Purchasers obtained funds to purchase the Notes through capital
contributions from their investors.
ITEM 4. PURPOSE OF TRANSACTION.
Each of the Purchasers acquired the securities of TLC for
investment purposes, but retains the right to change its investment
intent. Subject to their obligations set forth in the Purchase
Agreements, the Purchasers may, depending on market conditions and other
factors, purchase additional securities of TLC or dispose of all or a
portion of their investment in TLC.
Pursuant to each of the Purchase Agreements, TLC agreed to
(a) take all actions necessary to ensure that one representative of each
of the following groups is appointed to the Board of Directors of TLC
(the "TLC Board"): (i) the Lee Purchasers and affiliates; (ii) the Bain
Purchasers and affiliates; and (iii) the Centre Purchasers and
affiliates; (b) use best efforts to cause each of the directors appointed
in accordance with subsection (a) and the representative of THL Co. then
currently serving on the TLC Board (or any successor nominees thereof)
(collectively, the "Purchasers' Representatives") to be renominated and
reelected when their initial and any subsequent term expires; and (c) use
best efforts to cause the election of two nominees from the four
Purchasers' Representatives to each of the executive, compensation and
audit committees of the TLC Board, in each case except to the extent that
the TLC Board determines in good faith, after consultation with outside
counsel, that contrary action is required by their fiduciary duties under
applicable law. The number of Purchasers' Representatives that TLC is
obligated to use best efforts to be renominated and/or reelected shall be
permanently decreased should any group hold less than the percentage of
Preferred Stock (or if any such Preferred Stock have been converted and
after making appropriate adjustment for any Restructuring (as defined in
the Purchase Agreements), shares of Common Stock and shares of Common
Stock issuable upon conversion of the Preferred Stock) specified in
Section 6.8 of the Purchase Agreements. Each of the Purchasers will
designate the representatives who will sit on the executive, compensation
and audit committees of the TLC Board based on a vote of a majority in
interest of the Purchasers.
Effective as of December 5, 1997, Anthony J. DiNovi was
appointed to the TLC Board as the representative for the Lee Purchasers
and their affiliates; Mark E. Nunnelly was appointed to the TLC Board as the
representative for the Bain Purchasers and their affiliates; and Paul J.
Zepf was appointed to the TLC Board as the representative for the Centre
Purchasers and their affiliates.
In the Purchase Agreements, each of the Purchasers covenanted
with the Company that, without the consent of the Company, for a period
continuing through August 26, 2002, such Purchaser will not, among other
things, purchase or acquire, or offer, propose or agree to purchase or
acquire, directly or indirectly, any of the Common Stock (other than by
conversion of the Shares (as defined in the Purchase Agreements)), any
option, warrant or other right to acquire, directly or indirectly, any
Common Stock or any securities which are convertible into or are exchange
able or exercisable for Common Stock, provided, however, that if at any
time the percentage of the outstanding Common Stock owned by such
Purchaser on a fully-diluted basis is less than the percentage of the
outstanding Common Stock owned by such Purchaser on a fully-diluted basis
on December 5, 1997 (the "Maximum Amount"), such Purchaser may purchase
additional shares of Common Stock up to the Maximum Amount. In addition,
no Purchaser shall, without the Company's consent, sell, transfer, effect
a short sale of, grant any option for the purchase of, or loan any Shares
or Common Stock for a period of 18 months from the date of issuance of
the Shares, except to an affiliate or another Purchaser or an affiliate
thereof; provided this restriction will cease to apply upon a mandatory
conversion of the Shares into Common Stock pursuant to the Restated
Certificate of Incorporation of the Company, and provided further that
each Purchaser may sell its Shares or Common Stock in any tender offer or
exchange offer made for any securities of the Company.
Further, the Purchasers covenanted that they will not
solicit, or encourage any other person to solicit, proxies or become a
participant or otherwise engage in any solicitation in opposition to a
recommendation of a majority of the directors of the Company with respect
to any matter; initiate, propose or otherwise solicit stockholders for
the approval of one or more stockholder proposals with respect to the
Company; except as results from the Purchase Agreements or arrangements
among the Purchasers, directly or indirectly participate in or encourage
the formation of any group owning or seeking to acquire beneficial
ownership of securities of the Company or affect control of the Company;
or, except as results from the Purchase Agreements or arrangements among
the Purchasers, otherwise act, directly or indirectly, to seek to control
or influence in any manner the management, business, operations, board of
directors, policies or affairs of the Company, or propose or seek to
effect any form of business combination transaction with the Company or
any affiliate thereof or any restructuring, recapitalization or similar
transaction with respect to the Company.
Except as discussed above, the Reporting Persons have no
current plans or proposals which relate to or would result in any of the
following:
(a) the acquisition by any person of additional securities of
the issuer, or the disposition of securities of the issuer;
(b) an extraordinary corporate transaction, such as a merger,
reorganization or liquidation involving the issuer or any of its
subsidiaries;
(c) a sale or transfer of a material amount of assets of the
issuer or of any of its subsidiaries;
(d) any change in the present board of directors or
management of the issuer, including any plans or proposals to
change the number or term of directors or to fill any existing
vacancies on the board;
(e) any material change in the present capitalization or divi
dend policy of the issuer;
(f) any other material change in the issuer's business or
corporate structure, including but not limited to, if the issuer is
a registered closed-end investment company, any plans or proposals
to make any changes in its investment policy for which a vote is
required by Section 13 of the Investment Company Act of 1940;
(g) changes in the issuer's charter, bylaws or instruments
corresponding thereto or other actions which may impede the acquisi
tion of control of the issuer by any person;
(h) causing a class of securities of the issuer to be
delisted from a national securities exchange or to cease to be
authorized to be quoted in an inter-dealer quotation system of a
registered national securities association;
(i) a class of equity securities of the issuer becoming
eligible for termination of registration pursuant to Section
12(g)(4) of the Exchange Act; or
(j) any action similar to any of those enumerated above.
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER.
(a) - (b)
As of the date hereof, each share of Preferred Stock issued
and outstanding is convertible into twenty shares of Common Stock.
LEE REPORTING PERSONS
As of the date hereof, by virtue of its beneficial ownership of
392,342 shares of Preferred Stock, Equity Fund III beneficially owns
7,846,840 shares of Common Stock. Such 392,342 shares of Preferred Stock
(assuming the conversion of all such 392,342 shares of Preferred Stock into
Common Stock) represent approximately 14.0% of the total number of shares
of Common Stock issued and outstanding as of November 11, 1997 (the
"Outstanding Shares") (plus the 7,846,840 shares of Common Stock held by
Equity Fund III upon such conversion and assuming that no other shares of
Preferred Stock held by others have been previously, or are simultaneously,
converted to Common Stock), as reported in TLC's Quarterly Report on Form
10-Q for the quarter ended October 4, 1997 (the "Quarterly Report"). Equity
Fund III has shared voting and shared dispositive power with respect to
such shares.
As of the date hereof, by virtue of its beneficial ownership
of 24,277 shares of Preferred Stock, Foreign Fund III beneficially owns
485,540 shares of Common Stock. Such 24,277 shares of Preferred Stock
(assuming the conversion of all such 24,277 shares of Preferred Stock
into Common Stock) represent approximately 1.0% of the Outstanding Shares
(plus the 485,540 shares of Common Stock held by Foreign Fund III upon
such conversion and assuming that no other shares of Preferred Stock held
by others have been previously, or are simultaneously, converted to
Common Stock), as reported in the Quarterly Report. Foreign Fund III has
shared voting and shared dispositive power with respect to such shares.
Advisors III, as sole general partner of Equity Fund III and
Foreign Fund III, and Trust III, as sole general partner of Advisors III,
may be deemed to share voting and dispositive power with respect to
8,332,380 shares of Common Stock currently held by Equity Fund III and
Foreign Fund III (assuming the conversion of all shares of Preferred
Stock held by Equity Fund III and Foreign Fund III into Common Stock),
which represents approximately 14.8% of the Outstanding Shares (plus the
8,332,380 shares of Common Stock held by Equity Fund III and Foreign Fund
III upon such conversion and assuming that no other shares of Preferred
Stock held by others have been previously, or are simultaneously,
converted to Common Stock), as reported in the Quarterly Report. The
filing of this Schedule 13D by Advisors III and Trust III shall not be
construed as an admission that Advisors III or Trust III is, for the
purpose of Section 13(d) of the Exchange Act, the beneficial owner of
such shares held by Equity Fund III or Foreign Fund III.
As of the date hereof, by virtue of its beneficial ownership
of 23,585 shares of Preferred Stock, THL-CCI beneficially owns 471,700
shares of Common Stock. Such 23,585 shares of Preferred Stock (assuming
the conversion of all such 23,585 shares of Preferred Stock into Common
Stock) represent approximately 1.0% of the total number of Outstanding
Shares (plus the 471,700 shares of Common Stock held by THL-CCI upon such
conversion and assuming that no other shares of Preferred Stock held by
others have been previously, or are simultaneously, converted to Common
Stock), as reported in the Quarterly Report. THL-CCI has shared voting
and shared dispositive power with respect to such shares.
THL Investment, as sole general partner of THL-CCI, may be
deemed to share voting and dispositive power with respect to 471,700
shares of Common Stock currently held by THL-CCI (assuming the conversion
of all shares of Preferred Stock held by THL-CCI into Common Stock),
which represents approximately 1.0% of the Outstanding Shares (plus the
471,700 shares of Common Stock held by THL-CCI upon such conversion and
assuming that no other shares of Preferred Stock held by others have been
previ ously, or are simultaneously, converted to Common Stock), as
reported in the Quarterly Report. The filing of this Schedule 13D by THL
Investment shall not be construed as an admission that THL Investment is,
for the purpose of Section 13(d) of the Exchange Act, the beneficial
owner of such shares held by THL-CCI.
See Schedule I for information regarding beneficial ownership
of the Additional Lee Investors.
BAIN REPORTING PERSONS
As of the date hereof, by virtue of its beneficial ownership
of 29,847 shares of Preferred Stock, BCF-V beneficially owns 596,940
shares of Common Stock. Such 29,847 shares of Preferred Stock (assuming
the conver sion of all such 29,847 shares of Preferred Stock into Common
Stock) represent approximately 1.2% of the total number of Outstanding
Shares (plus the 596,940 shares of Common Stock held by BCF-V upon such
conversion and assuming that no other shares of Preferred Stock held by
others have been previously, or are simultaneously, converted to Common
Stock), as reported in the Quarterly Report. BCF-V has shared voting and
shared dispositive power with respect to such shares.
As of the date hereof, by virtue of its beneficial ownership
of 77,722 shares of Preferred Stock, BCF-V-B beneficially owns 1,554,440
shares of Common Stock. Such 77,722 shares of Preferred Stock (assuming
the conversion of all such 77,722 shares of Preferred Stock) represent
approximately 3.1% of the total number of Outstanding Shares (plus the
1,554,440 shares of Common Stock held by BCF-V-B upon such conversion and
assuming that no other shares of Preferred Stock held by others have been
previously, or are simultaneously, converted to Common Stock), as
reported in the Quarterly Report. BCF-V-B has shared voting and shared
dispositive power with respect to such shares.
BCP, as the sole general partner of BCF-V and BCF-V-B and
BCI, as the sole general partner of BCP, may be deemed to share voting
and dispositive power with respect to 2,151,380 shares of Common Stock
cur rently held by BCF-V and BCF-V-B (assuming the conversion of all
shares of Preferred Stock held by BCF-V and BCF-V-B into Common Stock),
which represents approximately 4.3% of the total number of Outstanding
Shares (plus the 2,151,380 shares of Common Stock held by BCF-V and
BCF-V-B upon such conversion and assuming that no other shares of
Preferred Stock held by others have been previously, or are
simultaneously, converted to Common Stock), as reported in the Quarterly
Report. The filing of this Schedule 13D by BCP and BCI shall not be
construed as an admission that BCP or BCI is, for the purpose of Section
13(d) of the Exchange Act, the beneficial owner of such shares held by
BCF-V or BCF-V-B.
As of the date hereof, by virtue of its beneficial ownership
of 37,986 shares of Preferred Stock, BCIP beneficially owns 759,720
shares of Common Stock. Such 37,986 shares of Preferred Stock (assuming
the conversion of all such 37,986 shares of Preferred Stock into Common
Stock) represent approximately 1.6% of the total number of Outstanding
Shares (plus the 759,720 shares of Common Stock held by BCIP upon such
conversion and assuming that no other shares of Preferred Stock held by
others have been previously, or are simultaneously, converted to Common
Stock), as reported in the Quarterly Report. BCIP has shared voting and
shared dispositive power with respect to such shares.
As of the date hereof, by virtue of its beneficial ownership
of 6,885 shares of Preferred Stock, BCIPT beneficially owns 137,700
shares of Common Stock. Such 6,885 shares of Preferred Stock (assuming
the conversion of all such 6,885 shares of Preferred Stock into Common
Stock) represent approximately 0.3% of the total number of Outstanding
Shares (plus the 137,700 shares of Common Stock held by BCIPT upon such
conversion and assuming that no other shares of Preferred Stock held by
others have been previously, or are simultaneously, converted to Common
Stock), as reported in the Quarterly Report. BCIPT has shared voting and
shared dispositive power with respect to such shares.
Mr. Romney may be deemed to share voting and dispositive
power with respect to (i) 2,151,380 shares of Common Stock currently held
by BCF- V and BCF-V-B (assuming the conversion of all shares of Preferred
Stock held by BCF-V and BCF-V-B into Common Stock) in his capacity as
sole stockholder of BCI, (ii) 897,420 shares of Common Stock currently
held by BCIP and BCIPT (assuming the conversion of all shares of
Preferred Stock held by BCIP and BCIPT into Common Stock), in his
capacity as a member of the Management Committee of BCIP and BCIPT, and
(iii) 365,840 shares of Common Stock currently held by Brookside Fund
(assuming the conversion of all shares of Preferred Stock held by
Brookside Fund into Common Stock) in his capacity as sole stockholder of
Brookside Investors, which in the aggregate represent approximately 6.6%
of the total number of Outstanding Shares (plus the 3,414,640 shares of
Common Stock held by BCF-V, BCF-V-B, BCIP, BCIPT and Brookside Fund upon
such conversion and assuming that no other shares of Preferred Stock held
by others have been previously, or are simultaneously, converted to
Common Stock), as reported in the Quarterly Report. The filing of this
Schedule 13D by Mr. Romney shall not be construed as an admission that
Mr. Romney is, for the purpose of Section 13(d) of the Exchange Act, the
beneficial owner of such shares held by BCF- V, BCF-V-B, BCIP, BCIPT or
Brookside Fund.
Mr. Bekenstein, as a member of the Management Committee of BCIP
and BCIPT, may be deemed to share voting and dispositive power with respect
to 897,420 shares of Common Stock currently held by BCIP and BCIPT (assum
ing the conversion of all shares of Preferred Stock held by BCIP and BCIPT
into Common Stock), which represents approximately 1.8% of the total number
of Outstanding Shares (plus the 897,420 shares of Common Stock held by BCIP
and BCIPT upon such conversion and assuming that no other shares of
Preferred Stock held by others have been previously, or are simultaneously,
converted to Common Stock), as reported in the Quarterly Report. The filing
of this Schedule 13D by Mr. Bekenstein shall not be construed as an
admission that Mr. Bekenstein is, for the purpose of Section 13(d) of the
Exchange Act, the beneficial owner of such shares held by BCIP or BCIPT.
As of the date hereof, by virtue of its beneficial ownership
of 18,292 shares of Preferred Stock, Brookside Fund beneficially owns
365,840 shares of Common Stock. Such 18,292 shares of Preferred Stock
(assuming the conversion of all such 18,292 shares of Preferred Stock
into Common Stock) represent approximately 0.8% of the total number of
Outstanding Shares (plus the 365,840 shares of Common Stock held by
Brookside Fund upon such conversion and assuming that no other shares of
Preferred Stock held by others have been previously, or are
simultaneously, converted to Common Stock), as reported in the Quarterly
Report. Brookside Fund has shared voting and shared dispositive power
with respect to such shares.
Brookside Partners, as the sole general partner of Brookside
Fund, and Brookside Investors, as the sole general partner of Brookside
Partners, may be deemed to share voting and dispositive power with
respect to 365,840 shares of Common Stock currently held by Brookside
Fund (assuming the conversion of all shares of Preferred Stock currently
held by Brookside Fund into Common Stock), which represents approximately
0.8% of the total number of Outstanding Shares (plus the 365,840 shares
of Common Stock held by Brookside Fund upon such conversion and assuming
that no other shares of Preferred Stock held by others have been
previously, or are simultaneously, converted to Common Stock), as
reported in the Quarterly Report. The filing of this Schedule 13D by
Brookside Partners and Brookside Investors shall not be construed as an
admission that Brookside Partners or Brookside Investors is, for the
purpose of Section 13D of the Exchange Act, the beneficial owner of such
shares held by Brookside Fund.
CENTRE REPORTING PERSONS
As of the date hereof, by virtue of its beneficial ownership
of 37,344 shares of Preferred Stock, CCI beneficially owns 746,880 shares
of Common Stock. Such 37,344 shares of Preferred Stock (assuming the
conversion of all such 37,344 shares of Preferred Stock into Common
Stock) represent approximately 1.5% of the total number of Outstanding
Shares (plus the 746,880 shares of Common Stock held by CCI upon such
conversion and assuming that no other shares of Preferred Stock held by
others have been previously, or are simultaneously, converted to Common
Stock), as reported in the Quarterly Report. CCI has shared voting and
shared dispositive power with respect to such shares.
As of the date hereof, by virtue of its beneficial ownership of
12,152 shares of Preferred Stock, CCTI beneficially owns 243,040 shares of
Common Stock. Such 12,152 shares of Preferred Stock (assuming the conversion
of all such 12,152 shares of Preferred Stock into Common Stock)
represent approximately 0.5% of the total number of Outstanding Shares
(plus the 243,040 shares of Common Stock held by CCTI upon such conversion
and assuming that no other shares of Preferred Stock held by others have
been previously, or are simultaneously, converted to Common Stock), as
reported in the Quarterly Report. CCTI has shared voting and shared
dispositive power with respect to such shares.
As of the date hereof, by virtue of its beneficial ownership
of 7,492 shares of Preferred Stock, CCOI beneficially owns 149,840 shares
of Common Stock. Such 7,492 shares of Preferred Stock (assuming the
conver sion of all such 7,492 shares of Preferred Stock into Common
Stock) represent approximately 0.3% of the total number of Outstanding
Shares (plus the 149,840 shares of Common Stock held by CCOI upon such
conversion and assuming that no other shares of Preferred Stock held by
others have been previously, or are simultaneously, converted to Common
Stock), as reported in the Quarterly Report. CCOI has shared voting and
shared dispositive power with respect to such shares.
CPLP, as sole general partner of CCI, CCTI and CCOI, may be
deemed to share voting and dispositive power with respect to 1,139,760
shares of Common Stock currently held by CCI, CCTI and CCOI (assuming the
conversion of all shares of Preferred Stock held by CCI, CCTI and CCOI
into Common Stock), which represents approximately 2.3% of the
Outstanding Shares (plus the 1,139,760 shares of Common Stock held by
CCI, CCTI and CCOI upon such conversion and assuming that no other shares
of Preferred Stock held by others have been previously, or are
simultaneously, converted to Common Stock), as reported in the Quarterly
Report. The filing of this Schedule 13D by CPLP shall not be construed as
an admission that CPLP is, for the purpose of Section 13(d) of the
Exchange Act, the beneficial owner of such shares held by CCI, CCTI or
CCOI.
Pursuant to a management agreement with CPLP, CPM may be deemed
to share voting and dispositive power with respect to 1,139,760 shares of
Common Stock currently held by CCI, CCTI and CCOI (assuming the conversion
of all shares of Preferred Stock held by CCI, CCTI and CCOI into Common
Stock), and pursuant to a management agreement with CPMP, CPM may be deemed
to share voting and dispositive power with respect to 1,134,200 shares of
Common Stock currently held by Florida Board (assuming the conversion of
all shares of Preferred Stock held by Florida Board into Common Stock),
which in the aggregate, represents approximately 4.5% of the Outstanding
Shares (plus the 2,273,960 shares of Common Stock held by CCI, CCTI, CCOI
and Florida Board upon such conversion and assuming that no other shares of
Preferred Stock held by others have been previously, or are simultaneously,
converted to Common Stock), as reported in the Quarterly Report. The filing
of this Schedule 13D by CPM shall not be construed as an admission that CPM
is, for the purpose of Section 13D of the Exchange Act, the beneficial
owner of such shares held by CCI, CCTI, CCOI and Florida Board.
As of the date hereof, by virtue of its beneficial ownership
of 56,710 shares of Preferred Stock, Florida Board beneficially owns
1,134,200 shares of Common Stock. Such 56,710 shares of Preferred Stock
(assuming the conversion of all such 56,710 shares of Preferred Stock
into Common Stock) represent approximately 2.3% of the total number of
Outstanding Shares (plus the 1,134,200 shares of Common Stock held by
Florida Board upon such conversion and assuming that no other shares of
Preferred Stock held by others have been previously, or are
simultaneously, converted to Common Stock), as reported in the Quarterly
Report. Florida Board has shared voting and shared dispositive power with
respect to such shares.
As of the date hereof, by virtue of its beneficial ownership
of 573 shares of Preferred Stock, CPMP beneficially owns 11,460 shares of
Common Stock. In addition, as manager for certain funds of Florida Board,
CPMP may be deemed to share voting and dispositive power with respect to
1,134,200 shares of Common Stock currently held by Florida Board
(assuming the conversion of all shares of Preferred Stock held by Florida
Board into Common Stock). Such 1,145,660 shares of Common Stock in the
aggregate represent approximately 2.3% of the Outstanding Shares (plus
the 1,145,660 shares of Common Stock held by CPMP and Florida Board upon
such conversion and assuming that no other shares of Preferred Stock held
by others have been previously, or are simultaneously, converted to
Common Stock), as reported in the Quarterly Report. The filing of this
Schedule 13D by CPMP shall not be construed as an admission that CPMP is,
for the purpose of Section 13D of the Exchange Act, the beneficial owner
of such shares held by Florida Board.
As of the date hereof, by virtue of its beneficial ownership
of 7,680 shares of Preferred Stock, CPC beneficially owns 153,600 shares
of Common Stock. Such 7,680 shares of Preferred Stock (assuming the
conversion of all such 7,680 shares of Preferred Stock into Common
Stock) represent approximately 0.3% of the total number of Outstanding
Shares (plus the 153,600 shares of Common Stock held by CPC upon such
conversion and assuming that no other shares of Preferred Stock held by
others have been previously, or are simultaneously, converted to Common
Stock), as reported in the Quarterly Report. CPC has shared voting and
shared dispositive power with respect to such shares.
CPLLC, as sole general partner of CPMP, CPC and CPLP, may be
deemed to share voting and dispositive power with respect to 2,439,020
shares of Common Stock currently held by CPMP, Florida Board, CPC, CCI,
CCTI and CCOI (assuming the conversion of all shares of Preferred Stock
held by CPMP, Florida Board, CPC, CCI, CCTI and CCOI into Common Stock),
which represents approximately 4.8% of the Outstanding Shares (plus the
2,439,020 shares of Common Stock held by CPMP, Florida Board, CPC, CCI,
CCTI and CCOI upon such conversion and assuming that no other shares of
Preferred Stock held by others have been previously, or are simultaneously,
converted to Common Stock), as reported in the Quarterly Report. The filing
of this Schedule 13D by CPLLC shall not be construed as an admission that
CPLLC is, for the purpose of Section 13(d) of the Exchange Act, the
beneficial owner of such shares held by CPMP, Florida Board, CPC, CCI, CCTI
or CCOI.
Since the Purchasers acted together to the extent described
herein for the purpose of acquiring the Notes and the Preferred Stock,
they may be deemed to constitute a "group" within the meaning of Rule
13d-5 under the Exchange Act, and as such, the group would be deemed to
beneficially own all shares of Common Stock beneficially held, in the
aggregate, by all group members. Consequently, the group may be deemed to
benefi cially own an aggregate of 15,000,000 shares of Common Stock
(assuming the conversion of all shares of Preferred Stock held by the
Purchasers into Common Stock) representing approximately 23.8% of the
Outstanding Shares (plus the 15,000,000 shares of Common Stock held by
the Purchasers upon such conversion and assuming that no other shares of
Preferred Stock held by others have been previously, or are
simultaneously, converted to Common Stock), as reported in the Quarterly
Report. The Reporting Persons expressly disclaim membership in a group,
and each of the Lee Reporting Persons, Bain Reporting Persons and Centre
Reporting Persons expressly disclaims, except to the extent otherwise
specified herein, the shares of Common Stock held by the other Reporting
Persons.
The statements in this Schedule 13D shall not be construed as
an admission that a Reporting Person is the beneficial owner of any of
the shares of Common Stock other than those which such Reporting Person
has disclosed herein as beneficially owned.
(c) None of the Reporting Persons, nor, to the best knowledge
of the Reporting Persons, any of their officers, directors or trustees,
has effected any transactions in the Common Stock during the past 60 days
except as described herein.
(d) Not applicable.
(e) Not applicable.
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATION
SHIPS WITH RESPECT TO SECURITIES OF THE ISSUER.
The responses to Items 3, 4 and 5 of this Schedule 13D and
the Exhibits to this Schedule 13D are incorporated herein by reference.
Pursuant to a Registration Rights Agreement dated as of August
26, 1997 (the "Registration Rights Agreement"), a copy of which is attached
hereto as Exhibit D and is incorporated herein by reference, by and among
TLC and the Purchasers, upon the written request of one or more holders of
certain Registrable Securities (as defined in the Registration Rights
Agreement) of TLC, TLC will, subject to the terms of the Registration
Rights Agreement, use its best efforts to effect the registration of such
securities under the Securities Act.
Except for the agreements described in this Schedule 13D, to
the best knowledge of the Reporting Persons, there are no other
contracts, arrangements, understandings or relationships (legal or
otherwise) among the persons named in Item 2 and between such persons and
any person with respect to any securities of TLC, including, but not
limited to, transfer or voting of any of the securities, finder's fees,
joint ventures, loan or option arrangements, puts or calls, guarantees of
profits, division of profits or loss, or the giving or withholding of
proxies.
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS.
Exhibit A: Joint Filing Agreement dated as of
December 12, 1997 among the Reporting
Persons.
Exhibit B-1: Securities Purchase Agreement dated as
of August 26, 1997 among the THL Purchasers
and TLC, as amended as of September 16,
1997.
Exhibit B-2: Securities Purchase Agreement dated as
of August 26, 1997 among the Bain
Purchasers and TLC, as amended as of
September 16, 1997.
Exhibit B-3: Securities Purchase Agreement dated as
of August 26, 1997 among the Centre
Purchasers and TLC, as amended as of
September 16, 1997.
Exhibit C: Securities Purchase Agreement dated as
of August 26, 1997 among Tribune Company
and the Purchasers.
Exhibit D: Registration Rights Agreement dated as
of August 26, 1997 among THL and the
Purchasers.
Exhibit E: Power of Attorney dated December 12,
1997 granted by the Lee Reporting Persons
in favor of Scott M. Sperling and Anthony
J. DiNovi.
SIGNATURES FOR LEE REPORTING PERSONS
After reasonable inquiry and to the best knowledge and belief
of each of the undersigned, each such person certifies that the
information set forth in this statement is true, complete and correct.
THOMAS H. LEE EQUITY FUND III, L.P.
By: THL Equity Advisors III Limited
Partnership, its General Partner
By: THL Equity Trust III, its General
Partner
Date: December 12, 1997 By:/s/ Anthony J. DiNovi
---------------------------
Name: Anthony J. DiNovi
Title: Vice President
THOMAS H. LEE FOREIGN FUND III, L.P.
By: THL Equity Advisors III Limited
Partnership, its General Partner
By: THL Equity Trust III, its General
Partner
Date: December 12, 1997 By:/s/ Anthony J. DiNovi
---------------------------
Name: Anthony J. DiNovi
Title: Vice President
THL EQUITY ADVISORS III LIMITED PARTNERSHIP
By: THL Equity Trust III, its General
Partner
Date: December 12, 1997 By:/s/ Anthony J. DiNovi
---------------------------
Name: Anthony J. DiNovi
Title: Vice President
THL EQUITY TRUST III
Date: December 12, 1997 By:/s/ Anthony J. DiNovi
----------------------------
Name: Anthony J. DiNovi
Title: Vice President
THL-CCI LIMITED PARTNERSHIP
By: THL Investment Management Corp.,
its General Partner
Date: December 12, 1997 By:/s/ Wendy Masler
----------------------------
Name: Wendy Masler
Title: Vice President
THL INVESTMENT MANAGEMENT CORP.
Date: December 12, 1997 By:/s/ Wendy Masler
---------------------------
Name: Wendy Masler
Title: Vice President
Date: December 12, 1997 /s/ David V. Harkins
-----------------------------
David V. Harkins
THE 1995 HARKINS GIFT TRUST
Date: December 12, 1997 By:/s/ Sheryll Harkins
----------------------------
Name: Sheryll Harkins
Title: Trustee
MEETINGHOUSE FOUNDATION, INC.
By: PNC Bank, New England, as Trustee
Date: December 12, 1997 By: /s/ Peter K. Van Winkle
_________________________________
Name: /s/ Peter K. Van Winkle
Title: Chief Inv. Officer and SVP
Date: December 12, 1997 /s/ Scott A. Schoen
-------------------------------------
Scott A. Schoen
Date: December 12, 1997 /s/ C. Hunter Boll
------------------------------------
C. Hunter Boll
Date: December 12, 1997 /s/ Scott M. Sperling
-------------------------------------
Scott M. Sperling
Date: December 12, 1997 /s/ Anthony J. DiNovi
-------------------------------------
Anthony J. DiNovi
Date: December 12, 1997 /s/ Thomas M. Hagerty
-------------------------------------
Thomas M. Hagerty
Date: December 12, 1997 /s/ Warren C. Smith, Jr.
-------------------------------------
Warren C. Smith, Jr.
Date: December 12, 1997 /s/ Seth W. Lawry
-------------------------------------
Seth W. Lawry
Date: December 12, 1997 /s/ Joseph J. Incandela
------------------------------------
Joseph J. Incandela
Date: December 12, 1997 /s/ Kent R. Weldon
------------------------------------
Kent R. Weldon
Date: December 12, 1997 /s/ Terrence M. Mullen
------------------------------------
Terrence M. Mullen
Date: December 12, 1997 /s/ Todd M. Abbrecht
-----------------------------------
Todd M. Abbrecht
Date: December 12, 1997 /s/ Wendy L. Masler
-----------------------------------
Wendy L. Masler
Date: December 12, 1997 /s/ Andrew D. Flaster
-----------------------------------
Andrew D. Flaster
RESOURCES TRUST CO. FBO ANDREW D. FLASTER
Date: December 12, 1997 By: /s/ Andrew D. Flaster
_________________________________
Name: Andrew D. Flaster
Title:
FIRST TRUST CO. FBO KRISTINA A. WATTS
Date: December 12, 1997 By: /s/ Patricia Kenny
_______________________________
Name: Patricia Kenny
Title: SR. Investment Admin. Analyst
Date: December 12, 1997 /s/ Andrew T. Mulderry
-----------------------------------
Andrew T. Mulderry
Date: December 12, 1997 /s/ George R. Taylor
-----------------------------------
George R. Taylor
Date: December 12, 1997 /s/ Charles W. Robins
-----------------------------------
Charles W. Robins
Date: December 12, 1997 /s/ James Westra
-----------------------------------
James Westra
Date: December 12, 1997 /s/ Charles A. Brizius
----------------------------------
Charles A. Brizius
Date: December 12, 1997 /s/ Jeffrey B. Kovach
----------------------------------
Jeffrey B. Kovach
Date: December 12, 1997 /s/ Anjan Mukherjee
----------------------------------
Anjan Mukherjee
Date: December 12, 1997 /s/ Charles S. Woo
----------------------------------
Charles S. Woo
SIGNATURES FOR BAIN REPORTING PERSONS
After reasonable inquiry and to the best knowledge and belief of
each of the undersigned, each such person certifies that the information
set forth in this statement is true, complete and correct.
BAIN CAPITAL FUND V, L.P.
By: Bain Capital Partners V, L.P.,
as General Partner
By: Bain Capital Investors V, Inc.,
as General Partner
Date: December 12, 1997 By:/s/ Mark E. Nunnelly
--------------------
Name: Mark E. Nunnelly
Title: Managing Director
BAIN CAPITAL FUND V-B, L.P.
By: Bain Capital Partners V, L.P.,
as General Partner
By: Bain Capital Investors V, Inc.,
as General Partner
Date: December 12, 1997 By:/s/ Mark E. Nunnelly
--------------------
Name: Mark E. Nunnelly
Title: Managing Director
BAIN CAPITAL PARTNERS V, L.P.
By: Bain Capital Investors V, Inc.,
as General Partner
Date: December 12, 1997 By:/s/ Mark E. Nunnelly
--------------------
Name: Mark E. Nunnelly
Title: Managing Director
BAIN CAPITAL INVESTORS V, INC.
Date: December 12, 1997 By:/s/ Mark E. Nunnelly
--------------------
Name: Mark E. Nunnelly
Title: Managing Director
BCIP ASSOCIATES, L.P.
Date: December 12, 1997 By:/s/ Mark E. Nunnelly
--------------------
Name: Mark E. Nunnelly
Title: Managing Director
BCIP TRUST ASSOCIATES, L.P.
Date: December 12, 1997 By:/s/ Mark E. Nunnelly
--------------------
Name: Mark E. Nunnelly
Title: Managing Director
Date: December 12, 1997 /s/ W. Mitt Romney
------------------
W. Mitt Romney
Date: December 12, 1997 /s/ Joshua Bekenstein
---------------------
Joshua Bekenstein
BROOKSIDE CAPITAL PARTNERS FUND, L.P.
By: Brookside Capital Partners, L.P., as
General Partner
By: Brookside Capital Investors, Inc.,
as General Partner
Date: December 12, 1997 By:/s/ Mark E. Nunnelly
--------------------
Name: Mark E. Nunnelly
Title: Managing Director
BROOKSIDE CAPITAL PARTNERS, L.P.
By: Brookside Capital Investors, Inc., as
General Partner
Date: December 12, 1997 By:/s/ Mark E. Nunnelly
--------------------
Name: Mark E. Nunnelly
Title: Managing Director
BROOKSIDE CAPITAL INVESTORS, INC.
Date: December 12, 1997 By:/s/ Mark E. Nunnelly
--------------------
Name: Mark E. Nunnelly
Title: Managing Director
SIGNATURES FOR CENTRE REPORTING PERSONS
After reasonable inquiry and to the best knowledge and belief of
each of the undersigned, each such person certifies that the information
set forth in this statement is true, complete and correct.
CENTRE CAPITAL INVESTORS II, L.P.
CENTRE CAPITAL TAX-EXEMPT
INVESTORS II, L.P.
CENTRE CAPITAL OFFSHORE INVESTORS II, L.P.
By: Centre Partners II, L.P.,
as General Partner
By: Centre Partners Management LLC,
as Attorney-in-fact
Date: December 12, 1997 By:/s/ Jonathan H. Kagan
---------------------
Name: Jonathan H. Kagan
Title: Managing Director
STATE BOARD OF ADMINISTRATION OF FLORIDA
By: Centre Parallel Management Partners,
L.P., as Manager
By: Centre Partners Management LLC,
as Attorney-in-fact
Date: December 12, 1997 By:/s/ Jonathan H. Kagan
---------------------
Name: Jonathan H. Kagan
Title: Managing Director
CENTRE PARALLEL MANAGEMENT PARTNERS, L.P.
CENTRE PARTNERS COINVESTMENT, L.P.
By: Centre Partners II LLC,
as General Partner
Date: December 12, 1997 By:/s/ Jonathan H. Kagan
---------------------
Name: Jonathan H. Kagan
Title: Managing Director
CENTRE PARTNERS II, L.P.
By: Centre Partners Management LLC,
as Attorney-in-fact
Date: December 12, 1997 By:/s/ Jonathan H. Kagan
---------------------
Name: Jonathan H. Kagan
Title: Managing Director
CENTRE PARTNERS II LLC
Date: December 12, 1997 By:/s/ Jonathan H. Kagan
---------------------
Name: Jonathan H. Kagan
Title: Managing Director
CENTRE PARTNERS MANAGEMENT LLC
Date: December 12, 1997 By:/s/ Jonathan H. Kagan
---------------------
Name: Jonathan H. Kagan
Title: Managing Director
SCHEDULE I
<TABLE>
<CAPTION>
Number of Number of
Shares of Shares of % of
Preferred Stock Common Stock Common
Beneficially Beneficially Stock
Name of Additional Lee Investor Owned (1) Owned (1)(2) (3)
- ------------------------------- --------------- ------------ ---
<S> <C> <C> <C>
David V. Harkins 3,256 (4) 65,120 (5) 0.1%
The 1995 Harkins Gift Trust 326 6,520 0.01
Meetinghouse Foundation, Inc. (6) 1,017 20,340 0.04
Scott A. Schoen 1,954 39,080 0.08
C. Hunter Boll 1,954 39,080 0.08
Scott M. Sperling 1,628 32,560 0.07
Anthony J. DiNovi 1,628 32,560 0.07
Thomas H. Hagerty 1,628 32,560 0.07
Warren C. Smith, Jr. 1,628 32,560 0.07
Seth W. Lawry 488 9,760 0.02
Joseph J. Incandela 407 8,140 0.02
Kent R. Weldon 244 4,880 0.01
Terrence M. Mullen 122 2,440 0.01
Todd M. Abbrecht 122 2,440 0.01
Wendy L. Masler 122 2,440 0.01
Andrew D. Flaster 122 (7) 2,440 (8) 0.01
Resources Trust Co. FBO Andrew 61 1,220 0.003
D. Flaster (9)
First Trust Co. FBO Kristina A. 122 2,440 0.01
Watts (9)
Andrew T. Mulderry 61 1,220 0.003
George R. Taylor 61 1,220 0.003
Charles W. Robins 122 2,440 0.01
James Westra 122 2,440 0.01
Charles A. Brizius 122 2,440 0.01
Jeffrey B. Kovach 61 1,220 0.003
Anjan Mukherjee 61 1,220 0.003
Charles S. Woo 61 1,220 0.003
</TABLE>
- ------------------
1 Unless otherwise indicated, each Additional Lee Investor has sole
voting and sole dispositive power with respect to such shares.
2 Assumes the conversion of each issued and outstanding share of Pre
ferred Stock into twenty shares of Common Stock.
3 Based on total number of shares of Common Stock issued and
outstanding as of November 11, 1997, as reported in the Quarterly
Report, plus the shares of Common Stock held by such Additional Lee
Investor upon conversion and assuming that no other shares of
Preferred Stock held by others (including the other Additional Lee
Investors) have been previously, or are simultaneously, converted
to Common Stock.
4 Includes 326 shares of Preferred Stock held by The 1995 Harkins
Gift Trust. Mr. Harkins may be deemed to share voting and
dispositive power with respect to such shares. The filing of this
Schedule 13D by Mr. Harkins shall not be construed as an admission
that Mr. Harkins is, for the purpose of Section 13(d) of the
Exchange Act, the benefi cial owner of such shares held by The 1995
Harkins Gift Trust.
5 Includes 6,520 shares of Common Stock held by The 1995 Harkins Gift
Trust (assuming the conversion of all shares of Preferred Stock
held by The 1995 Harkins Gift Trust into Common Stock). Mr. Harkins
may be deemed to share voting and dispositive power with respect to
such shares. The filing of this Schedule 13D by Mr. Harkins shall
not be construed as an admission that Mr. Harkins is, for the
purpose of Section 13(d) of the Exchange Act, the beneficial owner
of such shares held by The 1995 Harkins Gift Trust.
6 The address for MeetingHouse Foundation, Inc., a non-profit family
foundation, is c/o Peter K. Van Winkle, PNC Bank, New England, 125
High Street, Boston, Massachusetts 02110.
7 Includes 61 shares of Preferred Stock held by Resources Trust Co.
FBO Andrew D. Flaster. Mr. Flaster shares voting and dispositive
power with respect to such shares.
8 Includes 1,220 shares of Common Stock held by Resources Trust Co.
FBO Andrew D. Flaster (assuming the conversion of all shares of
Preferred Stock held by Resources Trust Co. FBO Andrew D. Flaster
into Common Stock). Mr. Flaster shares voting and dispositive
power with respect to such shares.
9 An IRA account.
SCHEDULE II-A
THL Equity Trust III
Each of the following officers and trustees of THL Equity
Trust III is a United States citizen and is employed by the Thomas H. Lee
Company, 75 State Street, Boston, Massachusetts 02109.
Officers:
Chairman Thomas H. Lee
1 Old Farm Road, Lincoln, MA 01773
President David V. Harkins
8 Corn Point Road, Marblehead, MA 01945
Vice Presidents C. Hunter Boll
45 Fletcher Street, Winchester, MA 01890
Thomas R. Shepherd
172 Harvard Road, Stow, MA 01775
Anthony J. DiNovi
167 Commonwealth Avenue, #9, Boston, MA 02116
Thomas M. Hagerty
256 Beacon Street, Apt. #4, Boston, MA 02116
Joseph J. Incandela
139 Abbott Road, Wellesley Hills, MA 02181
Scott A. Schoen
65 Laurel Road, Weston, MA 02193
Warren C. Smith, Jr.
38 Coolidge Lane, Dedham, MA 02026
Scott M. Sperling
4 Moore Road, Wayland, MA 01778
Seth W. Lawry
330 Dartmouth Street, Apt. #7S, Boston, MA 02116
Treasurer Wendy L. Masler
11 Waverly Street, #3, Brookline, MA 02115
Asst. Treasurer Andrew D. Flaster
69 Wilshire Park, Needham, MA 02192
Clerk Wendy L. Masler
11 Waverly Street, #3, Brookline, MA 02115
Asst. Clerks Charles W. Robins, Esq.
50 Lehigh Road, Wellesley, MA 02181
Jeffrey S. Wieand, Esq.
1695 Lowell Road, Concord, MA 01742
Trustees:
Thomas H. Lee 1 Old Farm Road, Lincoln, MA 01773
David V. Harkins 8 Corn Point Road, Marblehead, MA 01945
C. Hunter Boll 45 Fletcher Street, Winchester, MA 01890
Thomas R. Shepherd 172 Harvard Road, Stow, MA 01775
Anthony J. DiNovi 167 Commonwealth Avenue, #9, Boston, MA 02116
Thomas M. Hagerty 256 Beacon Street, Apt. #4, Boston, MA 02116
Warren C. Smith, Jr. 38 Coolidge Lane, Dedham, MA 02026
Scott M. Sperling 4 Moore Road, Wayland, MA 01778
THL Investment Management Corp.
Each of the following officers and directors of the THL Invest
ment Management Corp. is a United States citizen and is employed by the
Thomas H. Lee Company, 75 State Street, Boston, Massachusetts 02109.
Officers:
Chief Executive Thomas H. Lee
Officer and 1 Old Farm Road, Lincoln, MA 01773
Chairman
of the Board
President David V. Harkins
8 Corn Point Road, Marblehead, MA 01945
Vice Presidents C. Hunter Boll
45 Fletcher Street, Winchester, MA 01890
Anthony J. DiNovi
167 Commonwealth Avenue, #9, Boston, MA 02116
Thomas M. Hagerty
256 Beacon Street, Apt. #4, Boston, MA 02116
Joseph J. Incandela
139 Abbott Road, Wellesley Hills, MA 02181
Wendy L. Masler
11 Waverly Street, #3, Brookline, MA 02115
Scott A. Schoen
65 Laurel Road, Weston, MA 02193
Thomas R. Shepherd
172 Harvard Road, Stow, MA 01755
Warren C. Smith, Jr.
38 Coolidge Lane, Dedham, MA 02026
Scott M. Sperling
4 Moore Road, Wayland, MA 01778
Seth W. Lawry
330 Dartmouth Street, Apt. #7S, Boston, MA 02116
Kent R. Weldon
134 West Newton Street, Boston, MA 02118
Treasurer Wendy L. Masler
11 Waverly Street, #3, Brookline, MA 02115
Asst. Treasurer Andrew D. Flaster
69 Wilshire Park, Needham, MA 02192
Clerk Wendy L. Masler
11 Waverly Street, #3, Brookline, MA 02115
Asst. Clerks Jeffrey S. Wieand
1695 Lowell Road, Concord, MA 01742
Charles W. Robins
50 Lehigh Road, Wellesley, MA 02181
James Westra
5 Stage Hill Road, Wenham, MA 01984
Director:
Thomas H. Lee 1 Old Farm Road, Lincoln, MA 01773
SCHEDULE II-B
Bain Capital Investors V, Inc. and Brookside Capital Investors, Inc.
Each of the following officers and managing directors of Bain Capital
Investors V, Inc. and Brookside Capital Investors, Inc., is a United
States citizen and is employed by Bain Capital, Inc., Two Copley Place,
Boston, Massachusetts 02116.
Officers:
President and CEO W. Mitt Romney
Treasurer Joshua Bekenstein
Secretary Stephen D. Pagliuca
Managing Directors:
W. Mitt Ronney
Joshua Bekenstein
Stephen D. Pagliuca
Edward Conard
David Dominik
Paul B. Edgerley
Robert C. Gay
Adam Kirsch
Ronald P. Mika
Mark E. Nunnelly
Geoffrey S. Rehnert
Robert F. White
Marc C. Wolpow
BCIP Associates, L.P. and BCIP Trust Associates, L.P.
Each of the following general partners of BCIP Associates, L.P. and
BCIP Trust Associates, L.P. is a United States citizen and is employed by
Bain Capital, Inc., Two Copley Place, Boston, Massachusetts 02116:
Prescott Ashe, Charles A. Ballard, Andrew Balson, Steven Barnes, Joshua
Bekenstein, Carson Biederman, Roy Edgar Brakeman, III, Sherwin Chen, Edward
Conard, John P. Connaughton, Todd Cook, Christine P. Daly, David Dominik,
Paul B. Edgerley, Domenic Ferrante, E. Blair Ford, Jacques Garibaldi,
Robert C. Gay, Nathan Gilliland, Jonathan Goodman, Marshall Haines, Igor
Ioppe, Yoo Jin Kim, Adam Kirsch, Michael Krupka, Jonathan Lavine, Matthew
Levin, Susan Lock, Ian Loring, Phil Loughlin, John W. Maki, Michele D. May,
Sarma Melngailis, Ronald P. Mika, Jacob Mizrahi, Thomas W. Morgan, Kristin
W. Mugford, Brian Murphy, Mark Nunnelly, Jack O'Malley, Stephen G.
Pagliuca, William Pappendick, Dwight Poler, Joseph Pretlow, Geoffrey S.
Rehnert, Ian Reynolds, Tchad Clark Robinson, W. Mitt Romney, Douglas J.
Rudisch, Ashish Rughwani, Neil Simpkins, Paul Spinale, Ann Marie Viglione,
Robert F. White, Marc B. Wolpow, Eric Baker, Ted Berk, Chris Gordon, Jordan
Hitch, Benjamin Hochberg, Neil Houghton, Ryan Kim, Todd Miranowski, Andrew Raab,
Eric Ragatz, Laura Shen, Daniel Shih, Joahn Touissant and Steven Zide.
Schedule II-C
Centre Partners Management LLC and Centre Partners II LLC
Each of the following officers of Centre Partners Management LLC
and Centre Partners II LLC is a United States citizen and is employed by
Centre Partners Management LLC, 30 Rockefeller Plaza, Suite 5050, New
York, New
York 10020.
Officers:
Managing Directors Lester Pollack
Jonathan H. Kagan
Bruce G. Pollack
David B. Golub
EXHIBIT A
Joint Filing Agreement
In accordance with Rule 13d-1(f) of the Securities Exchange
Act of 1934, as amended, each of the parties hereto agrees with the other
parties that the statement of Schedule 13D pertaining to certain
securities of The Learning Company, Inc. to which this agreement is an
exhibit is filed by and on behalf of each such party and that any
amendment thereto will be filed on behalf of each such party.
SIGNATURES FOR LEE REPORTING PERSONS
THOMAS H. LEE EQUITY FUND III, L.P.
By: THL Equity Advisors III Limited
Partnership, its General Partner
By: THL Equity Trust III, its General
Partner
Date: December 12, 1997 By:/s/ Anthony J. DiNovi
-----------------------------
Name: Anthony J. DiNovi
Title: Vice President
THOMAS H. LEE FOREIGN FUND III, L.P.
By: THL Equity Advisors III Limited
Partnership, its General Partner
By: THL Equity Trust III, its General
Partner
Date: December 12, 1997 By:/s/ Anthony J. DiNovi
------------------------------
Name: Anthony J. DiNovi
Title: Vice President
THL EQUITY ADVISORS III LIMITED
PARTNERSHIP
By: THL Equity Trust III, its General
Partner
Date: December 12, 1997 By:/s/ Anthony J. DiNovi
------------------------------
Name: Anthony J. DiNovi
Title: Vice President
THL EQUITY TRUST III
Date: December 12, 1997 By:/s/ Anthony J. DiNovi
-------------------------------
Name: Anthony J. DiNovi
Title: Vice President
THL-CCI LIMITED PARTNERSHIP
By: THL Investment Management Corp.,
its General Partner
Date: December 12, 1997 By:/s/ Wendy Masler
------------------------------
Name: Wendy Masler
Title: Vice President
THL INVESTMENT MANAGEMENT CORP.
Date: December 12, 1997 By:/s/ Wendy Masler
-----------------------------
Name: Wendy Masler
Title: Vice President
Date: December 12, 1997 /s/ David V. Harkins
--------------------------------
David V. Harkins
THE 1995 HARKINS GIFT TRUST
Date: December 12, 1997 By:/s/ Sheryll Harkins
-------------------
Name: Sheryll Harkins
Title: Trustee
MEETINGHOUSE FOUNDATION, INC.
By: PNC Bank, New England, as Trustee
Date: December 12, 1997 By: /s/ Peter K. Van Winkle
____________________________________
Name: Peter K. Van Winkle
Title: Chief Inv. Officer and SVP
Date: December 12, 1997 /s/ Scott A. Schoen
-----------------------------------
Scott A. Schoen
Date: December 12, 1997 /s/ C. Hunter Boll
-----------------------------------
C. Hunter Boll
Date: December 12, 1997 /s/ Scott M. Sperling
-----------------------------------
Scott M. Sperling
Date: December 12, 1997 /s/ Anthony J. DiNovi
----------------------------------
Anthony J. DiNovi
Date: December 12, 1997 /s/ Thomas M. Hagerty
----------------------------------
Thomas M. Hagerty
Date: December 12, 1997 /s/ Warren C. Smith, Jr.
----------------------------------
Warren C. Smith, Jr.
Date: December 12, 1997 /s/ Seth W. Lawry
----------------------------------
Seth W. Lawry
Date: December 12, 1997 /s/ Joseph J. Incandela
--------------------------------
Joseph J. Incandela
Date: December 12, 1997 /s/ Kent R. Weldon
---------------------------------
Kent R. Weldon
Date: December 12, 1997 /s/ Terrence M. Mullen
---------------------------------
Terrence M. Mullen
Date: December 12, 1997 /s/ Todd M. Abbrecht
--------------------------------
Todd M. Abbrecht
Date: December 12, 1997 /s/ Wendy L. Masler
--------------------------------
Wendy L. Masler
Date: December 12, 1997 /s/ Andrew D. Flaster
--------------------------------
Andrew D. Flaster
RESOURCES TRUST CO. FBO ANDREW D. FLASTER
Date: December 12, 1997 By: /s/ Andrew D. Flaster
_____________________________________
Name: Andrew D. Flaster
Title:
FIRST TRUST CO. FBO KRISTINA A. WATTS
Date: December 12, 1997 By: /s/ Patricia Kenny
__________________________________
Name: Patricia Kenny
Title: SR. Investment Admin. Analyst
Date: December 12, 1997 /s/ Andrew T. Mulderry
-------------------------------------
Andrew T. Mulderry
Date: December 12, 1997 /s/ George R. Taylor
-------------------------------------
George R. Taylor
Date: December 12, 1997 /s/ Charles W. Robins
-------------------------------------
Charles W. Robins
Date: December 12, 1997 /s/ James Westra
-------------------------------------
James Westra
Date: December 12, 1997 /s/ Charles A. Brizius
-------------------------------------
Charles A. Brizius
Date: December 12, 1997 /s/ Jeffrey B. Kovach
-------------------------------------
Jeffrey B. Kovach
Date: December 12, 1997 /s/ Anjan Mukherjee
-------------------------------------
Anjan Mukherjee
Date: December 12, 1997 /s/ Charles S. Woo
-------------------------------------
Charles S. Woo
SIGNATURES FOR BAIN REPORTING PERSONS
BAIN CAPITAL FUND V, L.P.
By: Bain Capital Partners V, L.P.,
as General Partner
By: Bain Capital Investors V, Inc.,
as General Partner
Date: December 12, 1997 By:/s/ Mark E. Nunnelly
-----------------------------------
Name: Mark E. Nunnelly
Title: Managing Director
BAIN CAPITAL FUND V-B, L.P.
By: Bain Capital Partners V, L.P.,
as General Partner
By: Bain Capital Investors V, Inc.,
as General Partner
Date: December 12, 1997 By:/s/ Mark E. Nunnelly
-----------------------------------
Name: Mark E. Nunnelly
Title: Managing Director
BAIN CAPITAL PARTNERS V, L.P.
By: Bain Capital Investors V, Inc.,
as General Partner
Date: December 12, 1997 By:/s/ Mark E. Nunnelly
------------------------------------
Name: Mark E. Nunnelly
Title: Managing Director
BAIN CAPITAL INVESTORS V, INC.
Date: December 12, 1997 By:/s/ Mark E. Nunnelly
------------------------------------
Name: Mark E. Nunnelly
Title: Managing Director
BCIP ASSOCIATES, L.P.
Date: December 12, 1997 By:/s/ Mark E. Nunnelly
------------------------------------
Name: Mark E. Nunnelly
Title: Managing Director
BCIP TRUST ASSOCIATES, L.P.
Date: December 12, 1997 By:/s/ Mark E. Nunnelly
------------------------------------
Name: Mark E. Nunnelly
Title: Managing Director
Date: December 12, 1997 /s/ W. Mitt Romney
---------------------------------------
W. Mitt Romney
Date: December 12, 1997 /s/ Joshua Bekenstein
---------------------------------------
Joshua Bekenstein
BROOKSIDE CAPITAL PARTNERS FUND, L.P.
By: Brookside Capital Partners, L.P., as
General Partner
By: Brookside Capital Investors, Inc.,
as General Partner
Date: December 12, 1997 By:/s/ Mark E. Nunnelly
------------------------------------
Name: Mark E. Nunnelly
Title: Managing Director
BROOKSIDE CAPITAL PARTNERS, L.P.
By: Brookside Capital Investors, Inc., as
General Partner
Date: December 12, 1997 By:/s/ Mark E. Nunnelly
------------------------------------
Name: Mark E. Nunnelly
Title: Managing Director
BROOKSIDE CAPITAL INVESTORS, INC.
Date: December 12, 1997 By:/s/ Mark E. Nunnelly
------------------------------------
Name: Mark E. Nunnelly
Title: Managing Director
SIGNATURES FOR CENTRE REPORTING PERSONS
CENTRE CAPITAL INVESTORS II, L.P.
CENTRE CAPITAL TAX-EXEMPT
INVESTORS II, L.P.
CENTRE CAPITAL OFFSHORE INVESTORS II, L.P.
By: Centre Partners II, L.P.,
as General Partner
By: Centre Partners Management LLC,
as Attorney-in-fact
Date: December 12, 1997 By:/s/ Jonathan H. Kagan
-------------------------------------
Name: Jonathan H. Kagan
Title: Managing Director
STATE BOARD OF ADMINISTRATION OF FLORIDA
By: Centre Parallel Management Partners,
L.P., as Manager
By: Centre Partners Management LLC,
as Attorney-in-fact
Date: December 12, 1997 By:/s/ Jonathan H. Kagan
-------------------------------------
Name: Jonathan H. Kagan
Title: Managing Director
CENTRE PARALLEL MANAGEMENT PARTNERS, L.P.
CENTRE PARTNERS COINVESTMENT, L.P.
By: Centre Partners II LLC,
as General Partner
Date: December 12, 1997 By:/s/ Jonathan H. Kagan
-------------------------------------
Name: Jonathan H. Kagan
Title: Managing Director
CENTRE PARTNERS II, L.P.
By: Centre Partners Management LLC,
as Attorney-in-fact
Date: December 12, 1997 By:/s/ Jonathan H. Kagan
-------------------------------------
Name: Jonathan H. Kagan
Title: Managing Director
CENTRE PARTNERS II LLC
Date: December 12, 1997 By:/s/ Jonathan H. Kagan
-------------------------------------
Name: Jonathan H. Kagan
Title: Managing Director
CENTRE PARTNERS MANAGEMENT LLC
Date: December 12, 1997 By:/s/ Jonathan H. Kagan
-------------------------------------
Name: Jonathan H. Kagan
Title: Managing Director
Exhibit B-1
SECURITIES PURCHASE AGREEMENT
Between
THE PURCHASERS NAMED HEREIN
and
THE LEARNING COMPANY, INC., as Issuer
Dated as of August 26, 1997
Series A Convertible Participating Preferred Stock
TABLE OF CONTENTS
Page
ARTICLE I
AUTHORIZATION AND SALE OF SHARES.............................. 1
Section 1.1 Authorization. ............................. 1
Section 1.2 Issuance and Sale of Shares. ............... 2
ARTICLE II
CLOSING....................................................... 2
Section 2.1 Closing Date. .............................. 2
Section 2.2 Further Assurances. ........................ 3
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE COMPANY................. 3
Section 3.1 SEC Reports. ............................... 3
Section 3.2 Accountants. ............................... 4
Section 3.3 Financial Statements. ...................... 4
Section 3.4 Absence of Certain Changes. ................ 4
Section 3.5 Authority. ................................. 5
Section 3.6 Non-Contravention. ......................... 5
Section 3.7 Capitalization. ............................ 6
Section 3.8 Subsidiaries. .............................. 6
Section 3.9 Actions. ................................... 7
Section 3.10 Investment Company Act. .................... 7
Section 3.11 Reporting. ................................. 7
Section 3.12 Registration and Qualification. ............ 7
Section 3.13 No Liabilities. ............................ 7
Section 3.14 No Defaults. ............................... 8
Section 3.15 Violations of Law. ......................... 8
Section 3.16 Enforceability of Agreement. ............... 8
Section 3.17 The Capital Stock. ......................... 8
Section 3.18 Properties. ................................ 9
Section 3.19 Intellectual Property. ..................... 10
Section 3.20 Taxes. ..................................... 10
Section 3.21 Insurance. ................................. 10
Section 3.22 Certain Payments. .......................... 10
Section 3.23 Delaware General Corporation Law Section 203. 10
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE PURCHASERS.............. 11
Section 4.1 Investment. ................................ 11
Section 4.2 Rule 144. .................................. 11
Section 4.3 Organization of Purchaser. ................. 11
Section 4.4 Authority of Purchaser. .................... 12
Section 4.5 Non-Contravention. ......................... 12
Section 4.6 Title to the Notes. ........................ 12
ARTICLE V
CONDITIONS TO THE OBLIGATIONS OF THE PARTIES.................. 13
Section 5.1 General Conditions to Obligations of
the Purchasers. ............................ 13
Section 5.2 Registration Rights Agreement. ............. 13
Section 5.3 Officers' Certificates. .................... 13
Section 5.4 Opinions. .................................. 13
Section 5.5 Certificate of Designation. ................ 14
Section 5.6 Material Adverse Effect. ................... 14
Section 5.7 [Intentionally Left Blank]. ................ 14
Section 5.8 General Conditions to the Obligations
of the Company. ............................ 14
Section 5.9 No Injunction. ............................. 14
Section 5.10 HSR Waiting Period. ........................ 15
Section 5.11 Shareholder Approval. ...................... 15
Section 5.12 Receipt of Consents. ....................... 15
ARTICLE VI
COVENANTS OF THE COMPANY...................................... 15
Section 6.1 Reporting. ................................. 15
Section 6.2 Payment of Expenses. ....................... 15
Section 6.3 Inspection. ................................ 16
Section 6.4 Availability of Common Stock. .............. 16
Section 6.5 Transaction Fee. ........................... 16
Section 6.6 Fleet Bank Consent. ........................ 16
Section 6.7 Proxy Statements; Stockholder
Approvals. ................................. 16
Section 6.8 Election to Board of Directors of the
Company. ................................... 17
Section 6.9 No General Solicitation. ................... 19
ARTICLE VII
COVENANTS OF THE PURCHASERS.................................. 19
Section 7.1 Certain Restrictions. ...................... 19
ARTICLE VIII
RESTRICTIONS ON TRANSFERABILITY OF SECURITIES................. 21
Section 8.1 Restrictive Legend. ........................ 21
Section 8.2 Notice of Proposed Transfers. .............. 22
ARTICLE IX
TERMINATION................................................... 23
ARTICLE X
INDEMNIFICATION................................................23
Section 10.1 Indemnification. ........................... 23
Section 10.2 Terms of Indemnification. .................. 24
ARTICLE XI
MISCELLANEOUS................................................. 25
Section 11.1 Governing Law. ............................. 25
Section 11.2 Survival. .................................. 25
Section 11.3 Successors and Assigns. .................... 25
Section 11.4 Entire Agreement; Amendment. ............... 26
Section 11.5 Notices, Etc. .............................. 26
Section 11.6 Delays or Omissions. ....................... 26
Section 11.7 Counterparts. .............................. 27
Section 11.8 Severability. .............................. 27
Section 11.9 Titles and Subtitles. ...................... 27
Section 11.10 No Public Announcement. .................... 27
Section 11.11 Reasonable Efforts. ........................ 27
Section 11.12 Distributions and Adjustments. ............. 27
Exhibits
Exhibit A - Certificate of Designation
Exhibit B - Registration Rights Agreement
Exhibit C - Opinion of Counsel for the Company
Exhibit D - Opinion of Hale and Dorr LLP
SECURITIES PURCHASE AGREEMENT
This SECURITIES PURCHASE AGREEMENT (this "Agreement") is made
as of August 26, 1997 between The Learning Company, Inc., a Delaware
corporation (the "Company"), and each of the Purchasers listed on the
signature pages hereto (individually, a "Purchaser" and collectively, the
"Purchasers").
The Company is simultaneously entering into securities
purchase agreements (the "Other Purchase Agreements" and, together with
this Agreement, the "Purchase Agreements") with affiliates of Bain Capital,
Inc. and Centre Partners Management LLC (together, the "Other Purchasers")
dated the date hereof. The Purchase Agreements provide, subject to the
terms and conditions thereof, for the purchase by the Purchasers and the
Other Purchasers of an aggregate of 750,000 shares of Series A Convertible
Participating Preferred Stock, par value $.01 per share, of the Company
having the terms set forth in the Certificate of Designation (the
"Certificate of Designation") attached hereto as Exhibit A (the "Preferred
Stock") in exchange for the surrender of the Company's 5 1/2% Senior
Convertible/Exchangeable Notes due 2000 (the "Notes") in an aggregate
principal amount of $150,000,000 then to be held by the Purchasers and the
Other Purchasers.
In consideration of the mutual covenants, agreements,
representations and warranties herein set forth, it is hereby agreed
between the Company and the Purchasers as follows:
ARTICLE I
AUTHORIZATION AND SALE OF SHARES
SECTION 1.1 AUTHORIZATION. Subject to the obtaining of any
requisite stockholder approval referred to in Section 5.11, the Company has
heretofore authorized the issuance and sale to the Purchasers pursuant to
this Agreement of an aggregate of 457,317 shares of the Preferred Stock
(the "Shares") and to the Other Purchasers pursuant to the Other Purchase
Agreements of an aggregate of 292,683 shares of Preferred Stock (the "Other
Shares").
SECTION 1.2 ISSUANCE AND SALE OF SHARES. Upon the terms and
subject to the conditions set forth herein, on the Closing Date (as defined
below), (a) the Company will issue and sell to the Purchasers and, in
reliance on the representations and warranties of the Company contained
herein, the Purchasers will purchase from the Company the Shares in
exchange for Notes in an aggregate principal amount of $91,463,400 then to
be held by the Purchasers delivered free and clear of all liens,
encumbrances, equities or claims and (b) the Company will make a cash
payment to the Purchasers by wire transfer of immediately available funds
in an amount equal to the interest accrued on the Notes sold to the Company
by the Purchasers from the last interest payment date on the Notes up to
and including the Closing Date (as defined below).
ARTICLE II
CLOSING
SECTION 2.1 CLOSING DATE. The closing (the "Closing") of the
purchase and sale of the Shares contemplated hereby shall take place on
such date and at such time as agreed to by the Company and the Purchasers
but in no event later than three business days following the date upon
which all of the conditions set forth in Article V and all the conditions
to closing in the Note Purchase Agreement (as defined below) are satisfied
or waived (the date of the Closing is hereinafter referred to as the
"Closing Date"). The Closing shall be held at the offices of Skadden, Arps,
Slate, Meagher & Flom LLP, One Beacon Street, Boston, Massachusetts, or at
such other place as agreed to by the Company and the Purchasers. The
Closing shall occur simultaneously with the closing of the transactions
contemplated by the Other Purchase Agreements and the Securities Purchase
Agreement among Tribune Company, the Purchasers and the Other Purchasers
dated the date hereof (the "Note Purchase Agreement") and the closing of
each shall be conditioned on the closing of the others.
Delivery of the Shares to be purchased by the Purchasers
pursuant to this Agreement shall be made at the Closing by the Company
delivering to each Purchaser, against payment of the purchase price
therefor, one certificate representing the appropriate number of Shares
(registered in the name of such Purchaser or such other person which shall
be an affiliate of such Purchaser or a nominee of such Purchaser or such
affiliate as such Purchaser may have designated in writing to the Company
at least one business day prior to the Closing Day), unless at least two
business days prior to the Closing Date such Purchaser shall have requested
that the Company deliver more than one certificate representing the Shares,
in which event the Company will deliver to each Purchaser the number of
certificates so requested, registered in such name or names specified in
such request (subject to the foregoing limitation). Payment of the purchase
price for the Shares to be purchased hereunder shall be made by the
Purchaser by delivery of Notes in the aggregate principal amount of
$91,463,400 to the Company duly endorsed for transfer to the Company with
all signatures guaranteed by stock powers or other evidence of transfer
reasonably acceptable to the Company.
SECTION 2.2 FURTHER ASSURANCES. From time to time following
the Closing, upon the request of any Purchaser, the Company shall execute
and deliver, or cause to be executed and delivered, to such Purchaser such
other instruments and take such other action as may be reasonably necessary
to more effectively vest in such Purchaser and put the Purchaser in
possession of the shares of common stock par value $.01 per share, of the
Company (the "Common Stock") issuable upon conversion of the Shares. The
Company shall cooperate with the Purchasers in obtaining as soon as
practicable all necessary governmental consents and approvals, including
approvals under the Hart-Scott-Rodino Antitrust Improvements Act of 1976,
as amended (the "HSR Act").
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
As an inducement to the Purchasers to enter into this
Agreement and to consummate the transactions contemplated hereby, the Company
represents and warrants to each of the Purchasers as follows:
SECTION 3.1 SEC REPORTS. The Company has filed all documents
required to be filed since January 1, 1995 with the Securities and Exchange
Commission (the "Commission") (the "SEC Reports"). As of their respective
dates, the SEC Reports complied in all material respects with the
requirements of the Securities Act of 1933, as amended (including the rules
and regulations promulgated thereunder, the "Securities Act"), and the
Securities Exchange Act of 1934, as amended (including the rules and
regulations promulgated thereunder, the "Exchange Act"), as the case may
be, and none of the SEC Reports contained any untrue statement of a
material fact or omitted to state a material fact required to be stated
therein, in order to make the statements contained therein, in light of the
circumstances under which they were made, not misleading.
SECTION 3.2 ACCOUNTANTS. Coopers & Lybrand L.L.P., Arthur
Andersen LLP, KPMG Peat Marwick LLP, Price Waterhouse LLP and Deloitte &
Touche LLP, who have expressed their respective opinions with respect to
the financial statements and schedules included in the SEC Reports, are
independent accountants as required by the Securities Act.
SECTION 3.3 FINANCIAL STATEMENTS. (a) The annual audited
financial statements of the Company included in the relevant Report on Form
10-K for the period ended January 4, 1997 (the "10-K") present fairly in
all material respects the financial position of the Company, as of the
respective date of such financial statements, and the results of operations
and changes in cash flows of the Company for the respective periods covered
thereby. Such statements and related notes have been prepared in accordance
with generally accepted accounting principles applied on a consistent
basis, in each case, as certified by one or more of the independent
accountants named in Section 3.2.
(b) The unaudited interim financial statements of the Company
included in the Company's Quarterly Report on Form 10-Q for the period
ended July 5, 1997 (the "Second Quarter 10-Q") present fairly in all
material respects the financial position of the Company, as of the
respective dates of such financial statements, and the results of
operations and changes in cash flows of the Company for the respective
periods covered thereby. Such statements and related notes have been
prepared in accordance with generally accepted accounting principles
applied on a consistent basis except for normal year-end adjustments and
the omission of certain footnote disclosure.
SECTION 3.4 ABSENCE OF CERTAIN CHANGES. Except as disclosed in
Section 3.4 of a letter dated the date hereof from and previously delivered
by the Company to the Purchasers (the "Disclosure Letter"), (a) since the
date of the latest balance sheet presented in the Second Quarter 10-Q there
has been no material adverse change in the business, properties, prospects,
operations, condition (financial or other) or results of operations of the
Company and its Subsidiaries (as defined herein) taken as a whole, whether
or not arising from transactions in the ordinary course of business,
provided that a decline in the trading price of the Common Stock shall not
be deemed to be such a material adverse change if such decline is not
attributable to a material adverse change in the business, properties,
operations, prospects, condition (financial or other) or results of
operations of the Company and its Subsidiaries taken as a whole, (b) since
the date of the latest balance sheet presented in the Second Quarter 10-Q,
neither the Company nor any of its Subsidiaries has incurred or undertaken
any liabilities or obligations, direct or contingent, except for (i)
liabilities or obligations which are reflected in the Second Quarter 10-Q
and (ii) the transactions contemplated by this Agreement and the Other
Purchase Agreements, (iii) contractual liabilities incurred in the ordinary
course of business, (iv) other liabilities that would not have a material
adverse effect on the business, properties, prospects, operations,
condition (financial or other) or results of operations of the Company and
its subsidiaries taken as a whole and (v) liabilities incurred in
connection with any acquisition of another business entity made by the
Company after the date hereof.
SECTION 3.5 AUTHORITY. The Company has all necessary corporate
power and corporate authority to enter into this Agreement, the Other
Purchase Agreements and the other agreements, documents and instruments to
be executed by the Company in furtherance of the transactions contemplated
hereby and thereby, including without limitation, the Registration Rights
Agreement between the Company and the Purchasers, a form of which is
attached hereto as Exhibit B (the "Registration Rights Agreement")
(collectively, the "Transaction Documents"), and to consummate the
transactions contemplated hereby and thereby.
SECTION 3.6 NON-CONTRAVENTION. The execution, delivery, and
performance of the Transaction Documents by the Company and the
consummation of the transactions contemplated thereby by the Company do not
and will not (a) result in a breach of any of the terms and provisions of,
or constitute a default (or an event which with notice or lapse of time, or
both, would constitute a default) under, or result in the creation or
imposition of any lien, charge or encumbrance upon any property or assets
of the Company or any of its Subsidiaries (as defined below) pursuant to
any agreement, instrument, franchise, license or permit to which the
Company or any of its Subsidiaries is a party or by which any of such
corporations or their respective properties or assets may be bound or (b)
violate any judgment, decree, order, statute, rule or regulation of any
court or any public, governmental or regulatory agency or body applicable
to the Company or any of its Subsidiaries or any of their respective
properties or assets, other than such breaches, defaults or violations that
are not reasonably expected to impair the ability of the Company to
consummate the transactions contemplated by this Agreement. The execution,
delivery and performance of the Transaction Documents by the Company and
the consummation of the transactions contemplated thereby do not and will
not violate or conflict with any provision of the certificate of
incorporation or by-laws of the Company or any of its Subsidiaries, as
currently in effect. Except as set forth in Section 3.6 of the Disclosure
Letter, no consent, approval, authorization, order, registration, filing,
qualification, license or permit of or with any court or any government
agency or body applicable to the Company or any of its Subsidiaries or any
of their respective properties or assets is required for the execution,
delivery and performance of the Transaction Documents or the consummation
of the transactions contemplated thereby, including the issuance, sale and
delivery of the Shares to be issued, sold and delivered by the Company
hereunder.
SECTION 3.7 CAPITALIZATION. The Company had, as of July 5,
1997, an authorized and outstanding capitalization as set forth in the
Second Quarter 10-Q.
SECTION 3.8 SUBSIDIARIES. Except for the subsidiaries listed
in Section 3.8 of the Disclosure Letter, the Company does not own or
control, directly or indirectly, any "significant subsidiary" within the
meaning of Regulation S-X of the Commission. The subsidiaries listed in
Section 3.8 of the Disclosure Letter are hereinafter referred to as the
"Subsidiaries." Each of the Company and its Subsidiaries has been duly
organized and is validly existing as a corporation in good standing under
the laws of its jurisdiction of incorporation. Each of the Company and its
Subsidiaries is duly qualified to do business and in good standing as a
foreign corporation in each jurisdiction in which the character or location
of its properties (owned, lease or licensed) or the nature or conduct of
its business makes such qualification necessary, except for those failures
to be so qualified or in good standing which will not in the aggregate have
a material adverse effect on the Company and its Subsidiaries taken as a
whole. The Company owns all of the outstanding capital stock of each of its
Subsidiaries, other than the non-voting exchangeable shares of SoftKey
Software Products Inc. and qualifying shares of certain Subsidiaries
organized outside the United States, free and clear of all claims, liens,
charges and encumbrances other than as disclosed in Section 3.8 of the
Disclosure Letter. Each of the Company and its Subsidiaries has all
requisite power and authority, and all necessary consents, approvals,
authorizations, orders, registrations, qualifications, licenses and permits
of and from all public, regulatory or governmental agencies and bodies, to
own, lease and operate its properties and conduct its business as now being
conducted, except where the failure to possess such requisite power and
authority would not have a material adverse effect on the business,
properties, prospects, operations, condition (financial or other) or
results of operations of the Company and its Subsidiaries taken as a whole.
SECTION 3.9 ACTIONS. Except as described in Section 3.9 of the
Disclosure Letter, there is no litigation or governmental proceeding to
which the Company or any of its Subsidiaries is a party or to which any
property of the Company or any of its Subsidiaries is subject or which is
pending or, to the knowledge of the Company, threatened against the Company
or any of its Subsidiaries which could reasonably be expected to have a
material adverse effect on the business, properties, prospects, operations,
condition (financial or other) or results of operations of the Company and
its Subsidiaries taken as a whole.
SECTION 3.10 INVESTMENT COMPANY ACT. Neither the Company nor
any of its Subsidiaries is (i) an "investment company" or a company
"controlled" by an investment company within the meaning of the Investment
Company Act of 1940, as amended, (ii) a "holding company" or a "subsidiary
company" of a holding company or an "affiliate" thereof within the meaning
of the Public Utility Holding Company Act of 1935, as amended, or (iii)
subject to regulation under the Federal Power Act, the Interstate Commerce
Act or any federal or state statute or regulation limiting its ability to
consummate the transactions contemplated hereby.
SECTION 3.11 REPORTING. The Company is subject to Section 13
of the Exchange Act and is in compliance in all material respects with the
provisions of such section.
SECTION 3.12 REGISTRATION AND QUALIFICATION. Assuming the
accuracy of the representations and warranties made by each of the
Purchasers and set forth in Article IV hereof, it is not necessary in
connection with the offer, sale and delivery of the Shares to the
Purchasers in the manner contemplated by this Agreement to register the
Shares or the shares of Common Stock issuable upon conversion of the
Shares, under the Securities Act.
SECTION 3.13 NO LIABILITIES. Neither the Company nor its
Subsidiaries has any liabilities or obligations (direct or indirect,
contingent or absolute, known or unknown, matured or unmatured) of any
nature whatsoever, whether arising out of contract, tort, statute or
otherwise ("Liabilities"), except (i) as reflected or reserved against in
the latest balance sheet of the Company presented in the Second Quarter
10-Q and not heretofore discharged, (ii) as set forth in Section 3.13 of
the Disclosure Letter, (iii) liabilities incurred in the ordinary course of
business since the date of the latest balance sheet presented in the Second
Quarter 10-Q, (iv) contractual liabilities incurred in the ordinary course
of business, (v) liabilities incurred in connection with any acquisition of
another business entity made by the Company after the date hereof or (vi)
other liabilities that would not have a material adverse effect on the
business, properties, prospects, operations, condition (financial or other)
or results of operations of the Company and its subsidiaries taken as a
whole.
SECTION 3.14 NO DEFAULTS. Except as disclosed in Section 3.14
of the Disclosure Letter, neither the Company nor any of its Subsidiaries
is in violation or default under any provision of its certificate of
incorporation, by-laws or other organization documents, or is in breach of
or default with respect to any provision of any agreement, judgment,
decree, order, mortgage, deed of trust, lease, franchise, license,
indenture, permit or other instrument to which it is a party or by which it
or any of its properties are bound; and there does not exist an event of
default on the part of the Company or any such Subsidiary as defined in
such documents which, with notice or lapse of time or both, would
constitute a default, which such violation or default, in either such case,
would not have a material adverse effect on the business, properties,
prospects, operations, condition (financial or other) or results of
operations of the Company and its subsidiaries taken as a whole.
SECTION 3.15 VIOLATIONS OF LAW. The Company and its
Subsidiaries are in compliance, and have complied at all times during the
past three years, and all transactions pursuant to the Transaction
Documents shall comply with all applicable federal, state and local
statutes, codes, ordinances, rules and regulations of the United States and
all other countries and subdivisions thereof (the "Laws") to the extent
applicable, other than violations which would not have a material adverse
effect on the business, properties, operations, condition (financial or
other) or results of operations of the Company and its Subsidiaries taken
as a whole. Neither the Company nor any of its Subsidiaries has received
notice within the past three years of any violations of any Laws, which
violations would be material to the Company and its subsidiaries taken as a
whole.
SECTION 3.16 ENFORCEABILITY OF AGREEMENT. This Agreement has
been, and the other agreements to be executed and delivered by the Company
pursuant hereto have been or will be, duly and validly authorized, executed
and delivered by the Company and this Agreement is, and such other
agreements when so executed and delivered will be, valid and binding
obligations of the Company, enforceable against the Company in accordance
with their terms.
SECTION 3.17 THE CAPITAL STOCK. (a) All of the outstanding
shares of Common Stock are duly and validly authorized and issued, fully
paid and nonassessable, have been issued in compliance with all federal and
state securities laws, and were not issued and are not now in violation of
or subject to any preemptive rights. All issued and outstanding shares of
capital stock of each Subsidiary have been duly authorized and validly
issued and are fully paid and nonassessable. Except as disclosed in Section
3.17 of the Disclosure Letter as of the date hereof, neither the Company
nor any Subsidiary has outstanding any options to purchase, or any
preemptive rights or other rights to subscribe for or to purchase, any
securities or obligations convertible into, or any contracts or commitments
to issue or sell, shares of its capital stock or any such options, rights,
convertible securities or obligations. There are currently no shares of the
Company's preferred stock outstanding.
(b) (i) The Shares have been duly and validly authorized by
the Company and the Shares, when issued, sold and delivered in accordance
with this Agreement, will be duly and validly issued, fully paid and
nonassessable. The shares of Common Stock issuable upon conversion of the
Shares have been duly and validly authorized by the Company and, when
issued in accordance with the terms of the Shares, will be duly and validly
issued, fully paid and nonassessable. The shares of Common Stock issuable
on conversion of the Shares at the initial conversion price have been
reserved for issuance, and no further approval or authority of the
stockholders or the Board of Directors of the Company (the "Board of
Directors") under the Delaware General Corporation Law will be required for
such issuance of Common Stock following the Closing. No preemptive rights
or other rights to subscribe for or purchase securities exist with respect
to the issuance and sale of the Shares by the Company pursuant to this
Agreement or the issuance of Common Stock on conversion of the Shares.
(ii) Except as set forth in Section 3.17 of the Disclosure
Letter, no security holder of the Company has any right which has not been
satisfied or waived to require the Company to register the sale of any
securities owned by such security holder under the Securities Act.
SECTION 3.18 PROPERTIES. The Company or the applicable
Subsidiary holds its leased properties under valid and binding leases, with
such exceptions as are not materially significant in relation to the
business of the Company. Except as disclosed in Section 3.18 of the
Disclosure Letter, the Company owns or leases all such properties as are
necessary to its operations as now conducted.
SECTION 3.19 INTELLECTUAL PROPERTY. Except as disclosed in
Section 3.19 of the Disclosure Letter, the Company and its Subsidiaries have
sufficient trademarks, trade names, patent rights, copyrights, licenses,
approvals and governmental authorizations to conduct their businesses
substantially as now conducted; and the Company has no knowledge of any
infringement by it or its Subsidiaries of any trademark, trade name, patent,
copyright, licenses, trade secret or other similar rights of others, and there
is no claim being made against the Company or its Subsidiaries regarding
trademark, trade name, patent, copyright, license, trade secret or other
infringement, in any such case which could reasonably be expected to have a
material adverse effect on the business, properties, prospects, operations,
condition (financial or otherwise) or results of operations of the Company and
it or its Subsidiaries taken as a whole.
SECTION 3.20 TAXES. The Company and its Subsidiaries have
filed all necessary federal, state and foreign income and franchise tax
returns and have paid all taxes shown as due thereon; and the Company has
no knowledge of any tax deficiency which has been asserted or threatened
against the Company or its Subsidiaries which could have a material adverse
effect on the business, properties, prospects, operations, condition
(financial or otherwise) or results of operations of the Company and its
Subsidiaries taken as a whole.
SECTION 3.21 INSURANCE. The Company and its Subsidiaries
maintain insurance of the types and in the amounts generally deemed
adequate for its business and that of its Subsidiaries against theft,
damage, destruction, acts of vandalism and all other risks customarily
insured against, all of which insurance is in full force and effect.
SECTION 3.22 CERTAIN PAYMENTS. To the knowledge of the
Company, neither the Company nor any of its Subsidiaries has at any time
(i) made any unlawful contribution to any candidate for foreign office, or
failed to disclose fully any contribution in violation of law or (ii) made
any payment to any federal or state governmental officer or official, or
other person charged with similar public or quasi-public duties, other than
payments required or permitted by the laws of the United States or any
jurisdiction thereof.
SECTION 3.23 DELAWARE GENERAL CORPORATION LAW SECTION 203.
Section 203 of the Delaware General Corporation Law will not, prior to the
termination of this Agreement and the Other Purchase Agreements, apply to such
Agreements or the transactions contemplated hereby and thereby.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE PURCHASERS
As an inducement to the Company to enter into this Agreement
and to consummate the transactions contemplated hereby, each of the Purchasers
hereby represents and warrants to the Company as follows:
SECTION 4.1 INVESTMENT. Purchaser is acquiring the Shares and
the shares of Common Stock issuable upon conversion of the Shares for
investment for its own account, and not with a view to any distribution
thereof. Purchaser understands that the Shares and the shares of Common
Stock issuable upon conversion of the Shares have not been registered under
the Securities Act by reason of specific exemptions therefrom which depend
upon, among other things, the bona fide nature of the investment intent and
the accuracy of Purchaser's representations as expressed herein.
Purchaser's financial condition and investments are such that
it is in a position to hold the Shares and the shares of Common Stock issuable
upon conversion of the Shares for an indefinite period, bear the economic risks
of the investment and to withstand the complete loss of the investment.
Purchaser has extensive knowledge and experience in financial and business
matters and has the capability to evaluate the merits and risks of any Shares
and the shares of Common Stock issuable upon conversion of the Shares. Purchaser
qualifies as an "accredited investor" as such term is defined in Section 2(15)
of the Securities Act and Regulation D promulgated thereunder.
SECTION 4.2 RULE 144. Purchaser acknowledges that the Shares
and the shares of Common Stock issuable upon conversion of the Shares must be
held indefinitely unless subsequently registered under the Securities Act or any
applicable state securities laws or unless exemptions from such registrations
are available. Purchaser is aware of the provisions of Rule 144 promulgated
under the Securities Act which permit limited resale of securities purchased in
a private placement subject to the satisfaction of certain conditions.
SECTION 4.3 ORGANIZATION OF PURCHASER. Purchaser is duly
organized and validly existing under the laws of the jurisdiction of its
organization.
SECTION 4.4 AUTHORITY OF PURCHASER. Purchaser has the power
and authority (corporate or similar) to execute and deliver this Agreement, to
consummate the transactions contemplated hereby and to comply with the terms,
conditions and provisions hereof.
The execution, delivery and performance of this Agreement by
Purchaser has been duly authorized and approved by Purchaser and does not
require any further authorization or consent of Purchaser or its beneficial
owners. This Agreement is the legal, valid and binding agreement of Purchaser,
enforceable against Purchaser in accordance with its terms.
SECTION 4.5 NON-CONTRAVENTION. The execution, delivery and
performance of this Agreement by Purchaser and the consummation of any of
the transactions contemplated hereby by Purchaser will not (a) conflict
with or result in a breach of any of the terms and provisions of, or
constitute a default (or an event which with notice or lapse of time, or
both, would constitute a default) under, or result in the creation or
imposition of any lien, charge or encumbrance upon any property or assets
of Purchaser pursuant to any agreement, instrument, franchise, license or
permit to which Purchaser is a party or by which any of its properties or
assets may be bound or (b) violate or conflict with any judgment, decree,
order, statute, rule or regulation of any court or any public, governmental
or regulatory agency or body applicable to Purchaser or any of its
properties or assets, other than such breaches, defaults or violations that
are not reasonably expected to impair the ability of Purchaser to
consummate the transactions contemplated by this Agreement. The execution,
delivery and performance of this Agreement by Purchaser and the
consummation of the transactions contemplated hereby by Purchaser do not
and will not violate or conflict with any provision of the organizational
documents of Purchaser, as currently in effect. Except for filings under
the HSR Act, no consent, approval, authorization, order, registration,
filing, qualification, license or permit of or with any court or any
government agency or body applicable to Purchaser is required for the
execution, delivery and performance of this Agreement or the consummation
of the transactions contemplated hereby.
SECTION 4.6 TITLE TO THE NOTES. Upon consummation of the
transactions contemplated by the Note Purchase Agreement, the Purchasers
will have good and valid title to the Notes to be surrendered to the
Company hereunder, free and clear of all liens, encumbrances, equities or
claims; and, upon delivery of the Notes to the Company, good and valid
title to the Notes, free and clear of all liens, encumbrances, equities or
claims, will pass to the Company, assuming that the Company is acquiring
the Notes in good faith and without notice of any "adverse claims" within
the meaning of Article 8 of the Uniform Commercial Code.
ARTICLE V
CONDITIONS TO THE OBLIGATIONS OF THE PARTIES
A. OBLIGATIONS OF THE PURCHASERS
SECTION 5.1 GENERAL CONDITIONS TO OBLIGATIONS OF THE
PURCHASERS. The obligation of each of the Purchasers to consummate the
transactions contemplated herein is subject to the accuracy of the
representations and warranties of the Company herein contained, as of the date
hereof and as of the Closing Date, and to the performance in all material
respects by the Company of its obligations hereunder (including the covenants
contained in Article VI of this Agreement).
SECTION 5.2 REGISTRATION RIGHTS AGREEMENT. The obligation of
each of the Purchasers to consummate the transactions contemplated herein is
subject to the Registration Rights Agreement continuing to be in full force and
effect.
SECTION 5.3 OFFICERS' CERTIFICATES. The obligation of each of
the Purchasers to consummate the transactions contemplated herein is subject to
each of the Purchasers at the Closing Date receiving a certificate of the Chief
Executive Officer and Chief Financial Officer of the Company, dated the Closing
Date, to the effect that (i) as of the date hereof and as of the Closing Date,
the representations and warranties of the Company set forth in Article III
hereof are accurate and (ii) as of the Closing Date, the obligations of the
Company to be performed hereunder on or prior to the Closing Date have been
duly performed in all material respects.
SECTION 5.4 OPINIONS. The obligation of each of the Purchasers
to consummate the transactions contemplated herein is subject to each of the
Purchasers receiving at the Closing Date the opinion of Neal S. Winneg, General
Counsel for the Company, to the effect of the matters set forth in Exhibit C and
the opinion of Hale and Dorr LLP, special counsel for the Company, to the effect
of the matters set forth in Exhibit D.
SECTION 5.5 CERTIFICATE OF DESIGNATION. The obligation of each
of the Purchasers to consummate the transactions contemplated herein is subject
to the Certificate of Designation attached hereto as Exhibit A being duly
adopted by the Company and filed with the Secretary of State of the State of
Delaware.
SECTION 5.6 MATERIAL ADVERSE EFFECT. The obligation of each of
the Purchasers to consummate the transactions contemplated herein is subject to
there being since the date of the last balance sheet presented in the Second
Quarter 10-Q no fact or condition which would have, or insofar as reasonably can
be foreseen could have, a material adverse effect on the business, properties,
prospects, operations, condition (financial or other) or results of operations
of the Company and its Subsidiaries taken as a whole; provided, that a decline
in the trading price of the Common Stock shall not be deemed to be such a
material adverse effect if such decline is not attributable to a material
adverse change in the business, properties, prospects, operations, condition
(financial or other) or results of operations of the Company and its
subsidiaries taken as a whole.
SECTION 5.7 [Intentionally Left Blank].
B. OBLIGATIONS OF THE COMPANY
SECTION 5.8 GENERAL CONDITIONS TO THE OBLIGATIONS OF THE
COMPANY. The obligation of the Company to sell the Shares to each of the
Purchasers shall be subject to the accuracy of the representations and
warranties of each of the Purchasers herein contained except to the extent any
inaccuracies do not materially impair the ability of the Purchasers to
consummate the transaction contemplated by the Agreement, as of the date hereof
and as of the Closing Date, and to the performance in all material respects by
each of the Purchasers of its obligations hereunder.
C. OBLIGATIONS OF EACH OF THE COMPANY AND THE PURCHASERS
SECTION 5.9 NO INJUNCTION. The obligations of each of the
Company and the Purchasers to consummate the transactions contemplated
herein are subject to the condition that no temporary restraining order,
preliminary or permanent injunction or other order issued by any court of
competent jurisdiction prohibiting or preventing consummation of the
transactions contemplated herein shall be in effect.
SECTION 5.10 HSR WAITING PERIOD. The obligations of each of
the Company and the Purchasers to consummate the transactions contemplated
herein are subject to the condition of the expiration or early termination of
the application waiting periods under the HSR.
SECTION 5.11 SHAREHOLDER APPROVAL. The obligations of each of
the Company and the Purchasers to consummate the transactions contemplated
herein are subject to the approval of the issuance of the Shares, the Other
Shares and the shares of Common Stock issuable upon conversion of the
Shares and the Other Shares by the Company's stockholders in accordance
with the requirements of the New York Stock Exchange ("NYSE").
SECTION 5.12 RECEIPT OF CONSENTS. The obligation of each of
the Company and the Purchasers to consummate the transactions contemplated by
this Agreement are subject to the receipt by the Company of all governmental or
third-party consents shown in Section 5.12 of the Disclosure Letter the
transactions.
ARTICLE VI
COVENANTS OF THE COMPANY
As an inducement to the Purchasers to enter into this
Agreement and to consummate the transactions contemplated hereby, the Company
hereby covenants with each of the Purchasers as follows:
SECTION 6.1 REPORTING. The Company will, so long as the Shares
or the shares of Common Stock issuable upon conversion thereof are outstanding
and are "restricted securities" within the meaning of Rule 144(a)(3) under the
Securities Act, file reports and other information with the Commission under
Section 13 or 15 (d) of the Exchange Act.
SECTION 6.2 PAYMENT OF EXPENSES. Whether or not the
transactions contemplated in this Agreement are consummated or this
Agreement is terminated, the Company hereby agrees to pay (i) all costs and
expenses incident to the performance of the obligations of the Company
hereunder, including those in connection with (a) the issuance, transfer
and delivery of the Shares or the shares of Common Stock issuable upon
conversion thereof to each of the Purchasers, including any transfer or
similar taxes payable therein, (b) the qualification of Shares or the
shares of Common Stock issuable upon conversion thereof under state or
foreign securities or Blue Sky laws, (c) the cost of printing the Shares or
the shares of Common Stock issuable upon conversion thereof and (d) the
cost and charges of any transfer agent, registrar, trustee or fiscal paying
agent and to promptly pay (ii) all documented out-of-pocket costs and
expenses, including attorneys', accountants' and consultants' fees,
incurred by each of the Purchasers in connection with the negotiation and
consummation of this Agreement, the Note Purchase Agreement, the
Registration Rights Agreement and the transactions contemplated thereby up
to $800,000 in the aggregate for all Purchasers and Other Purchasers under
this Section 6.2 and Section 6.2 of the Other Purchase Agreements.
SECTION 6.3 INSPECTION. Prior to and following the Closing,
the Company will permit each of the Purchasers and their representatives to
visit and inspect any of the Company's properties, to examine its books and
records and to make copies and to take extracts therefrom, and to discuss its
business affairs and finances with its officers and key employees, all at such
reasonable times as the Purchasers may request.
SECTION 6.4 AVAILABILITY OF COMMON STOCK. The Company shall at
all times reserve and keep available out of its authorized but unissued
Common Stock, for the purpose of effecting the conversion of the Shares,
the full number of shares of Common Stock then issuable upon the conversion
of the Shares. The Company will, from time to time, in accordance with the
laws of the State of Delaware, increase the authorized amount of Common
Stock if at any time the number of shares of Common Stock remaining
unissued and available for issuance shall be insufficient to permit
conversion of the Shares.
SECTION 6.5 TRANSACTION FEE. Upon the execution of this
Agreement, the Company shall pay the Purchasers an aggregate fee equal to
$375,000. On the Closing Date, the Company shall pay the Purchasers an
additional aggregate fee equal to $750,000.
SECTION 6.6 FLEET BANK CONSENT. The Company will use its best
efforts to obtain the consent of Fleet Bank of Massachusetts, N.A. referred to
in Section 5.12 of the Disclosure Letter, within 10 days after the date hereof.
SECTION 6.7 PROXY STATEMENTS; STOCKHOLDER APPROVALS. The
Company acting through the Board of Directors, shall, in accordance with
applicable law and its Certificate of Incorporation and By-Laws:
(a) promptly and duly call, give notice of, convene and hold
as soon as practicable following the clearance of the proxy statement to be
issued in connection with the transactions contemplated herein (the "Proxy
Statement") with the SEC, but in no event later than the Closing Date, a
meeting of its stockholders for the purpose of voting to approve the
issuance of the Shares and the shares of Common Stock issuable upon
conversion thereof and shall use its best efforts, except to the extent the
Board of Directors determines in good faith, after consultation with
outside counsel, that contrary action is required by the Board of
Directors' fiduciary duties under applicable law, to obtain stockholder
approval;
(b) except to the extent the Board of Directors determines in
good faith, after consultation with outside counsel, that contrary action is
required by the Board of Directors' fiduciary duties under applicable law,
recommend approval of the issuance of the Shares and the shares of Common Stock
issuable upon conversion thereof, and include in the Proxy Statement such
recommendation, and take all lawful action to solicit such approvals; and
(c) as promptly as practicable following the signing of this
Agreement, prepare and file with the SEC a preliminary Proxy Statement and
respond to any comments of the SEC with respect to the preliminary Proxy
Statement and cause the definitive Proxy Statement to be mailed to its
stockholders.
SECTION 6.8 ELECTION TO BOARD OF DIRECTORS OF THE COMPANY.
Simultaneously with the Closing, the Company shall (a) take all actions
necessary to ensure that one representative of each of the following
Purchaser groups is appointed to the Board of Directors promptly after the
consummation of the transactions contemplated herein: (i) Thomas H. Lee
Equity Fund III, L.P., Thomas H. Lee Foreign Fund III, L.P., Thomas H. Lee
Company and affiliates (collectively, the "Lee Purchaser Group"); (ii) Bain
Capital Fund V, L.P., Bain Capital Fund V-B, L.P., BCIP Associates, L.P.,
BCIP Trust Associates, L.P. and affiliates (collectively, the "Bain
Purchaser Group"); and (iii) Centre Capital Investors II, L.P., Centre
Capital Tax-Exempt Investors II, L.P., Centre Capital Offshore Investors
II, L.P., State Board of Administration of Florida, Centre Parallel
Management Partners, L.P., Centre Partners Coinvestment, L.P. and
affiliates (collectively, the "Centre Purchaser Group"); (b) use best
efforts to cause each of the directors appointed in accordance with
subsection (a) hereof and the representative of the Thomas H. Lee Company
currently serving on the Board of Directors (and any successor nominees
thereof) (collectively, the "Purchasers' Representatives") to be
renominated and reelected when their initial and any subsequent term
expires, (c) use best efforts to cause the election of two nominees from
the four Purchasers' Representatives to each of the executive, compensation
and audit committees of the Board of Directors, in each case except to the
extent the Board of Directors determines in good faith, after consultation
with outside counsel, that contrary action is required by the Board of
Directors' fiduciary duties under applicable law; provided, however that if
(i) the Lee Purchaser Group, in the aggregate, holds less than 40% or 20%
of the Shares initially owned by the Lee Purchaser Group (or if any of such
Shares have been converted and after making appropriate adjustment for any
stock dividend, split-up, recapitalization, rights, merger or other change
in the corporate or capital structure of the Company (a "Restructuring"),
shares of Common Stock and shares of Common Stock issuable upon conversion
of the Shares representing less than 40% or 20% of the Common Stock
originally issuable upon conversion of the Shares), the Lee Purchaser Group
shall only be entitled to nominate one or no such nominees to the Board of
Directors, respectively; (ii) the Bain Purchaser Group holds less than 40%
of the Shares initially owned by the Bain Purchaser Group (or if any of
such Shares have been converted and after making appropriate adjustment for
any Restructuring, shares of Common Stock and shares of Common Stock
issuable upon conversion of the Shares representing less than 40% of the
Common Stock originally issuable upon conversion of the Shares), the Bain
Purchaser Group shall not be entitled to nominate any nominees to the Board
of Directors; and (iii) the Centre Purchaser Group holds less than 40% of
the Shares initially owned by the Centre Purchaser Group (or if any of such
Shares have been converted and after making appropriate adjustment for any
Restructuring, shares of Common Stock and shares of Common Stock issuable
upon conversion of the Shares representing less than 40% of the Common
Stock originally issuable upon conversion of the Shares), the Centre
Purchaser Group shall not be entitled to nominate any nominees to the Board
of Directors; and provided, further that (i) if at any time there are only
two Purchasers' Representatives serving on the Board of Directors, the
Company will use its best efforts to cause the election of only one of such
Purchasers' Representatives to each of the executive, compensation and
audit committee and (ii) if at any time there is only one Purchasers'
Representative serving on the Board of Directors, the Company is not
obligated to use its best efforts to cause the election of such Purchasers'
Representative to any of the committees. Each of the Purchasers and the
Other Purchasers will designate the representatives who will sit on the
executive, compensation and audit committees of the Board of Directors
based on a vote of a majority in interest of the Purchasers and the Other
Purchasers.
SECTION 6.9 NO GENERAL SOLICITATION. None of the Company, its
affiliates (as defined in Rule 501(b) of the Securities Act) or any person
acting on their behalf will solicit any offer to buy or offer or sell the
Shares by means of any form or general solicitation or general advertising
(as those terms are used in Regulation D under the Securities Act) or in
any manner involving a public offering within the meaning of Section 4(2)
of the Securities Act that would require the registration of the Shares
under the Securities Act.
ARTICLE VII
COVENANTS OF THE PURCHASERS
SECTION 7.1 CERTAIN RESTRICTIONS.
(a) Each of the Purchasers covenants with the Company that,
without the consent of the Company, for a period commencing on the date
hereof and continuing through the fifth anniversary of the date hereof,
none of the Purchasers, singly or as part of a group, directly or
indirectly, through one or more intermediaries or otherwise, will:
(i) purchase or acquire, or offer, propose or agree to
purchase or acquire, directly or indirectly, any of the Common Stock
(other than by conversion of any of the Shares), any option, warrant or
other right to acquire, directly or indirectly, any Common Stock or any
securities which are convertible into or exchangeable or exercisable
for Common Stock (other than the exercise of options under the Stock
Option Agreement dated the date hereof); provided, however, that
notwithstanding anything to the contrary contained herein, the
foregoing restriction shall not be deemed to be violated or applicable
if a Purchaser is not otherwise in breach of this Agreement and (A) the
amount of the outstanding Common Stock beneficially owned, in the
aggregate, by such Purchaser is increased as a result of any stock
dividend, stock split, split-up, recapitalization, merger or other
change in the corporate or capital structure of the Company or any
other action taken solely by the Company or (B) the Company breaches
its obligations under Section 6.8 hereof; and provided, further, that
at any time when the percentage of the outstanding Common Stock owned
by a Purchaser on a fully diluted basis is less than the percentage of
the outstanding Common Stock owned by such Purchaser on a fully diluted
basis on the Closing Date (the "Maximum Amount") such Purchaser may
purchase additional shares of Common Stock up to the Maximum Amount;
(ii) solicit, or encourage any other person to solicit,
"proxies" or become a "participant" or otherwise engage in any
"solicitation" (as such terms are defined or used in Regulation 14A
under the Exchange Act) in opposition to a recommendation of a majority
of the directors of the Company with respect to any matter; seek to
advise or influence any person (within the meaning of Section 13(d)(3)
of the Exchange Act) with respect to the voting of any securities of
the Company; or execute any written consent in lieu of a meeting of
holders of securities of the Company or any class thereof;
(iii) initiate, propose or otherwise solicit stockholders for
the approval of one or more stockholder proposals with respect to the
Company, as described in Rule 14a-8 under the Exchange Act;
(iv) except as results from the Purchase Agreements or from
arrangements among the Purchasers and the Other Purchasers, directly or
indirectly participate in or encourage the formation of any "group"
(within the meaning of Section 13(d)(3) of the Exchange Act) owning or
seeking to acquire beneficial ownership of securities of the Company or
affect control of the Company;
(v) except as results from the Purchase Agreements or from
arrangements among the Purchasers and the Other Purchasers, otherwise
act, directly or indirectly, alone or in concert with others, to seek
to control or influence in any manner the management, business,
operations, board of directors, policies or affairs of the Company, or
propose or seek to effect any form of business combination transaction
with the Company or any affiliate thereof or any restructuring,
recapitalization or other similar transaction with respect to the
Company; or
(vi) (a) encourage any person, firm, corporation, group or
other entity to engage in any of the actions covered by clauses (i)
through (v) of this Section 7.1 or make any public arrangement (or make
other communication with or to the Company or otherwise which, in the
opinion of counsel to the Company, would require public announcement)
with respect to any matter set forth in clause (i) through (v) of this
Section 7.1; provided, however, that actions taken by any
representative of the Purchaser on the Board of Directors of the
Company, acting in his or her capacity as such a director, shall not
violate this Section 7.1.
(b) No Purchaser shall, without the Company's
consent, sell, transfer, effect a short sale of, grant any option for
the purchase of, or loan any Shares or Common Stock for a period of 18
months from the date of issuance of the Shares except to an affiliate
or the Other Purchasers or an affiliate thereof; provided that this
restriction on each Purchaser's ability to sell or transfer any Shares
will cease to apply upon a conversion of the Shares pursuant to Section
8.10.1 of the Certificate of Designation; provided further, that each
Purchaser may sell its Shares or Common Stock in any tender offer or
exchange offer made for any Company securities.
ARTICLE VIII
RESTRICTIONS ON TRANSFERABILITY OF SECURITIES
SECTION 8.1 RESTRICTIVE LEGEND. Each certificate representing
(a) the Shares, (b) shares of the Common Stock issuable upon conversion of any
Shares, and (c) any other securities issued in respect of the Shares or Common
Stock issued upon conversion of any Shares upon any stock split, stock dividend,
recapitalization, merger, consolidation or similar event (each of the foregoing
securities in (a) through (c) being referred to herein as "Restricted
Securities"), shall (unless otherwise permitted by the provisions of Section 8.2
below) be stamped or otherwise imprinted with a legend substantially in the
following form (in addition to the legend required under any applicable state
securities laws):
THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE BEEN ACQUIRED
FOR INVESTMENT AND HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933 OR ANY APPLICABLE STATE SECURITIES LAWS. SUCH SHARES MAY NOT BE
SOLD OR TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATIONS OR EXEMPTIONS
THEREFROM UNDER SAID ACT OR LAWS. COPIES OF THE AGREEMENT COVERING THE
PURCHASE OF THESE SHARES AND THEIR TRANSFER MAY BE OBTAINED AT NO
COST BY WRITTEN REQUEST MADE BY THE HOLDER OF RECORD OF THIS
CERTIFICATE TO THE SECRETARY OF THE COMPANY.
The Company will promptly, upon request, remove any such legend when no longer
required by the terms of this Agreement or by applicable law.
SECTION 8.2 NOTICE OF PROPOSED TRANSFERS. Prior to any
proposed transfer of any Restricted Securities, unless there is in effect a
registration statement under the Securities Act covering the proposed transfer,
the Purchaser proposing such a transfer shall give written notice to the Company
of its intention to effect such transfer. Each such notice shall describe the
manner and circumstances of the proposed transfer in sufficient detail, and
shall be accompanied by either (a) a written opinion of legal counsel (who shall
be reasonably satisfactory to the Company) addressed to the Company to the
effect that the proposed transfer of the Restricted Securities may be effected
without registration under the Securities Act or (b) a "no action" letter from
the Commission to the effect that the transfer of such securities without
registration will not result in a recommendation by the staff of the Commission
that action be taken with respect thereto, whereupon, in each case, such
Purchaser shall be entitled to transfer such Restricted Securities in accordance
with the terms of the notice delivered by such Purchaser to the Company. Unless
there is in effect a registration statement under the Securities Act covering
the proposed transfer, each certificate evidencing the Restricted Securities
transferred as herein provided shall bear the appropriate restrictive legend set
forth in Section 8.1 above except that such certificate shall not bear such
restrictive legend if, (i) in the opinion of counsel for such Purchaser, such
legend is not required in order to establish compliance with any provisions of
the Securities Act, (ii) a period of at least one year has elapsed since the
later of the date the Restricted Securities were acquired from the Company or
from an affiliate of the Company, and such Purchaser represents to the Company
that it is not an affiliate of the Company and has not been an affiliate during
the preceding three months and shall not become an affiliate of the Company
without resubmitting the Restricted Securities for reimposition of the legend,
or (iii) the restricted Securities have been sold pursuant to Rule 144(k) and
the certificate is accompanied by a representation by such Purchaser that it is
not an affiliate of the Company, has not been an affiliate during the
three-month period prior to the sale and has held the Restricted Securities for
more than two years.
ARTICLE IX
TERMINATION
Notwithstanding anything contained herein to the contrary,
this Agreement may be terminated at any time prior to the Closing Date:
(a) by the mutual written consent of the Purchasers and the
Company;
(b) by any Purchaser or the Company if the Closing has not
occurred on or before six months from the date hereof and this Agreement has not
previously been terminated; provided, however, that the right to terminate the
Agreement under this Section 9(b) shall not be available to any party whose
failure to fulfill any obligation under this Agreement has been the cause of, or
resulted in, the failure of the Closing to occur on or before such date; or
(c) by any Purchaser or the Company if any of the Other
Purchase Agreements or the Note Purchase Agreement are terminated; or
(d) by any Purchaser 10 days after the Company's shareholders,
at a duly held meeting at which such shareholders vote on the issuance of the
Preferred Stock to the Purchasers or the Other Purchasers, fail to approve such
issuance.
In the event that this Agreement shall be terminated pursuant
to this Article IX, all further obligations of the parties under this Agreement
other than the obligations set forth in Article X and Sections 6.2, 6.5 and
11.10 shall be terminated without further liability of any party to any other
party, provided that nothing herein shall relieve any party from liability for
its willful breach of this Agreement.
ARTICLE X
INDEMNIFICATION
SECTION 10.1 INDEMNIFICATION. The Company hereby agrees to
indemnify, defend and hold harmless each Purchaser from and against all de-
mands, claims, actions or causes of action, assessments, losses, damages,
liabilities, costs and expenses (collectively, "Claims"), including without
limitation, interest, penalties and attorneys' fees and expenses, asserted
against, resulting to, or imposed upon or incurred by such Purchaser
directly or indirectly, in connection with the transactions contemplated
hereby.
SECTION 10.2 TERMS OF INDEMNIFICATION. The obligations and
liabilities of the Company with respect to Claims by third parties will be
subject to the following terms and conditions:
(a) a Purchaser will give the Company prompt notice of any
Claims asserted against, resulting to, imposed upon or incurred by a
Purchaser, directly or indirectly, and the Company will undertake the
defense thereof by representatives of their own choosing which are
reasonably satisfactory to such Purchaser; provided that the failure of any
Purchaser to give notice as provided in this Section 10.2 shall not relieve
the Company of its obligations under this Article X, except to the extent
that such failure has materially and adversely affected the rights of the
Company;
(b) if within a reasonable time after notice of any Claim, the
Company fails to defend, such Purchaser will have the right to undertake the
defense, compromise or settlement of such Claims on behalf of and for the
account and at the risk of the Company, subject to the right of the Company to
assume the defense of such Claim at any time prior to settlement, compromise or
final determination thereof;
(c) if there is a reasonable probability that a Claim may
materially and adversely affect a Purchaser other than as a result of money
damages or other money payments, such Purchaser will have the right at its own
expense to defend (provided that the indemnifying party shall continue to
control the defense and the indemnified party shall have the right to
participate in such defense), or co-defend, such Claim;
(d) the Company on one hand and the Purchasers on the other
will not, without the prior written consent of the other, settle or compromise
any Claim or consent to entry of any judgment relating to any such Claim;
(e) with respect to any Claims asserted against a Purchaser,
such Purchaser will have the right to employ one counsel of its choice in
each applicable jurisdiction (if more than one jurisdiction is involved) to
represent such Purchaser if, in such Purchaser's reasonable judgment, a
conflict of interest between such Purchaser and the indemnifying party
exists in respect of such Claims, and in that event the fees and expenses
of such separate counsel shall be paid by such indemnifying party;
(f) the Company will provide each Purchaser reasonable access
to all records and documents of the Company relating to any Claim; and
(g) any Claim, in so far as it is related to any of the
representations and warranties of the Company contained in this Agreement, must
be made within one year of the Closing Date.
ARTICLE XI
MISCELLANEOUS
SECTION 11.1 GOVERNING LAW. This Agreement shall be governed
by and construed in accordance with the laws of the Commonwealth of
Massachusetts, without regard to the conflict of laws rules thereof.
SECTION 11.2 SURVIVAL. All representations and warranties,
covenants and agreements of the Company and any Purchaser contained in this
Agreement shall remain operative and in full force and effect regardless of any
investigation made by or on behalf of any Purchaser or any controlling person
thereof or by or on behalf of the Company, any of its officers and directors or
any controlling person thereof, and such representations and warranties shall
survive for a period of one year from the Closing Date hereof.
SECTION 11.3 SUCCESSORS AND ASSIGNS. Except as otherwise
provided herein, the provisions hereof shall inure to the benefit of, and be
binding upon, the successors and permitted assigns of the parties hereto. No
assignment of this Agreement may be made by either party at any time, whether or
not by operation of law, without the other party's prior written consent, except
that each Purchaser may assign any of its rights hereunder to an affiliate of
such Purchaser or to the Other Purchasers or any of their affiliates without the
Company's consent provided that such affiliate expressly assumes in writing all
of the purchaser's obligations hereunder, and provided that such assignment
shall not relieve the assigning Purchaser of its obligations hereunder.
SECTION 11.4 ENTIRE AGREEMENT; AMENDMENT. This Agreement and
the Transaction Documents constitute the full and entire understanding and
agreement between the parties with regard to the subjects hereof and thereof
provided that the Confidentiality Agreement between the Purchasers and the
Company dated April 18, 1997 shall remain in effect. Except as expressly
provided herein, neither this Agreement nor any term hereof may be amended,
waived, discharged or terminated other than by a written instrument signed by
the party against whom enforcement of any such amendment, waiver, discharge or
termination is sought.
SECTION 11.5 NOTICES, ETC. All notices and other
communications provided for or permitted hereunder shall be made in writing by
hand-delivery, first-class mail (registered or certified, return receipt
requested), telex, telecopier or courier guaranteeing overnight delivery,
addressed (a) if to the Purchasers to Thomas H. Lee Company at 75 State Street,
Boston, Massachusetts 02109, Attention: Anthony J. DiNovi, or at such other
addresses as shall have been furnished to the Company with a copy to Louis A.
Goodman of Skadden, Arps, Slate, Meagher & Flom LLP at One Beacon Street,
Boston, Massachusetts 02108 and (b) if to the Company, at One Athenaeum Street,
Cambridge, Massachusetts 02142, Attention: Mr. Neal S. Winneg, or at such
other address as the Company shall have furnished to the Purchaser in writing
with a copy to Mark G. Borden at Hale and Dorr LLP, 60 State Street, Boston,
Massachusetts 02109. All such notices and communications shall be deemed to have
been duly given: at the time delivered by hand, if personally delivered; five
business days after being deposited in the mail, postage prepaid, if mailed;
when answered back, if telexed; when receipt is acknowledged, if telecopied; and
on the next business day, if timely delivered to a courier guaranteeing
overnight delivery.
SECTION 11.6 DELAYS OR OMISSIONS. Except as expressly provided
herein, no delay or omission to exercise any right, power or remedy
accruing to the Company or any of the Purchasers upon any breach or default
of any party under this Agreement, shall impair any such right, power or
remedy of the Company or any of the Purchasers nor shall it be construed to
be a waiver of any such breach or default, or an acquiescence therein, or
of or in any similar breach or default thereafter occurring; nor shall any
waiver of any single breach or default be deemed a waiver of any other
breach or default theretofore or thereafter occurring. Any waiver, permit,
consent or approval of any kind or character on the part of the Company or
any of the Purchasers of any breach or default under this Agreement, or any
waiver on the part of any such party of any provisions or conditions of
this Agreement, must be in writing and shall be effective only to the
extent specifically set forth in such writing. All remedies, either under
this Agreement or by law or otherwise afforded to the Company or any of the
Purchasers, shall be cumulative and not alternative.
SECTION 11.7 COUNTERPARTS. This Agreement may be executed in
any number of counterparts, each of which may be executed by only one of the
parties hereto, each of which shall be enforceable against the party actually
executing such counterpart, and all of which together shall constitute one
instrument.
SECTION 11.8 SEVERABILITY. In the event that any provision of
this Agreement becomes or is declared by a court of competent jurisdiction
to be illegal, unenforceable or void, this Agreement shall continue in full
force and effect without said provisions; provided that no such
severability shall be effective if it materially changes the economic
benefit of this Agreement to any party.
SECTION 11.9 TITLES AND SUBTITLES. The titles and subtitles
used in this Agreement are used for convenience only and are not to be
considered in construing or interpreting this Agreement.
SECTION 11.10 NO PUBLIC ANNOUNCEMENT. Neither the Company nor
any of the Purchasers shall make any press release or other public
announcement concerning the transactions contemplated by this Agreement
except as and to the extent that any such party shall be obligated to make
any such disclosure by law or by the NYSE and then only after consultation
with the other regarding the basis of such obligation and the content of
such press release or other public announcement or as the parties shall
mutually agree.
SECTION 11.11 REASONABLE EFFORTS. The Company and the
Purchasers shall use all reasonable efforts to consummate the transactions
contemplated by this Agreement, the Other Purchase Agreements and the Note
Purchase Agreement.
SECTION 11.12 DISTRIBUTIONS AND ADJUSTMENTS. If from July 5,
1997 through the Closing Date the Company shall have taken any action which
would entitle the holders of Preferred Stock to a distribution or
adjustment in accordance with the Certificate of Designation if the
Preferred Stock were then outstanding, then the consideration to be
received by the Purchasers hereunder shall be appropriately adjusted.
IN WITNESS WHEREOF, each of the undersigned has caused the
foregoing Agreement to be executed under seal by one of its duly authorized
officers as of the date first above written.
THE LEARNING COMPANY, INC
By /s/ R. Scott Murray
-------------------------------
Name: R. Scott Murray
Title: Executive Vice President and
Chief Financial Officer
PURCHASERS:
THOMAS H. LEE EQUITY FUND III, L.P.
By: THL Equity Advisors III Limited Partnership,
as General Partner
By: THL Equity Trust III,
as General Partner
By /s/ Anthony J. DiNovi
-------------------------------------
Name: Anthony J. DiNovi
Title: Vice President
THOMAS H. LEE FOREIGN FUND III, L.P.
By: THL Equity Advisors III Limited
Partnership, as General Partner
By: THL Equity Trust III,
as General Partner
By /s/ Anthony J. DiNovi
-------------------------------------
Name: Anthony J. DiNovi
Title: Vice President
THOMAS H. LEE COMPANY
By /s/ Anthony J. DiNovi
-------------------------------------
Name: Anthony J. DiNovi
Title: Managing Director
Amendment to Securities Purchase Agreement
Amendment dated as of September 16, 1997 to Securities
Purchase Agreement dated as of August 26, 1997 (the "Agreement")
between The Learning Company, Inc., a Delaware corporation (the
"Company") and each of the Purchasers listed on the signature page
hereto (individually, a "Purchaser" and collectively, the
"Purchasers").
For valuable consideration, receipt of which is hereby
acknowledged, the parties hereto hereby agree that Section 8.4 of the
Certificate of Designation of Series A Convertible Participating
Preferred Stock setting forth the powers, preferences, rights,
qualifications, limitations and restrictions of such series of
Preferred Stock, attached as Exhibit A to the Agreement, is hereby
amended to read in its entirety as follows:
"Section 8.4 Conversion Price. The initial conversion price
shall be the lower of (i) $10.00 or (ii) the weighted average (based
on daily trading volumes of the Common Stock on the New York Stock
Exchange) of the Closing Prices of the Common Stock for the period of
the 30 consecutive Trading Days immediately preceding the Trading Day
which is three Trading Days before the date on which the proxy
statement is sent to the Company's stockholders with respect to the
approval of the Company's stockholders with respect to the approval of
the issuance of the Series A Preferred Stock (herein called the
"Conversion Price") subject to adjustment as provided in this Section
8."
In all other respects, the Agreement shall remain in full
force and effect.
Executed as of September 16, 1997.
THE LEARNING COMPANY, INC.
By: /s/ R. Scott Murray
----------------------------------
Name: R. Scott Murray
Title: Executive Vice President and
Chief Financial Officer
PURCHASERS:
THOMAS H. LEE EQUITY FUND III, L.P.
By:
THL Equity Advisors III Limited
Partnership, as General Partner
By:
THL Equity Trust III, as General
Partner
By: /s/ Anthony J. DiNovi
----------------------------------
Name: Anthony J. DiNovi
Title: Vice President
THOMAS H. LEE FOREIGN FUND III, L.P.
By:
THL Equity Advisors III Limited
Partnership, as General Partner
By:
THL Equity Trust III, as General
Partner
By: /s/ Anthony J. DiNovi
----------------------------------
Name: Anthony J. DiNovi
Title: Vice President
THOMAS H. LEE COMPANY
By: /s/ Anthony J. DiNovi
----------------------------------
Name: Anthony J. DiNovi
Title: Managing Director
EXHIBIT B-2
SECURITIES PURCHASE AGREEMENT
Between
THE PURCHASERS NAMED HEREIN
and
THE LEARNING COMPANY, INC., as Issuer
Dated as of August 26, 1997
Series A Convertible Participating Preferred Stock
TABLE OF CONTENTS
Page
----
ARTICLE I
AUTHORIZATION AND SALE OF SHARES................................ 1
Section 1.1 Authorization. ............................. 1
Section 1.2 Issuance and Sale of Shares. ............... 2
ARTICLE II
CLOSING............................................ 2
Section 2.1 Closing Date. .............................. 2
Section 2.2 Further Assurances. ........................ 3
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE COMPANY......................... 3
Section 3.1 SEC Reports. ............................... 3
Section 3.2 Accountants. ............................... 4
Section 3.3 Financial Statements. ...................... 4
Section 3.4 Absence of Certain Changes. ................ 4
Section 3.5 Authority. ................................. 5
Section 3.6 Non-Contravention. ......................... 5
Section 3.7 Capitalization. ............................ 6
Section 3.8 Subsidiaries. .............................. 6
Section 3.9 Actions. ................................... 7
Section 3.10 Investment Company Act. .................... 7
Section 3.11 Reporting. ................................. 7
Section 3.12 Registration and Qualification. ............ 7
Section 3.13 No Liabilities. ............................ 7
Section 3.14 No Defaults. ............................... 8
Section 3.15 Violations of Law. ......................... 8
Section 3.16 Enforceability of Agreement. ............... 8
Section 3.17 The Capital Stock. ......................... 8
Section 3.18 Properties. ................................ 9
Section 3.19 Intellectual Property. ..................... 10
Section 3.20 Taxes. ..................................... 10
Section 3.21 Insurance. ................................. 10
Section 3.22 Certain Payments............................. 10
Section 3.23 Delaware General Corporations Law Section 203 10
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE PURCHASERS................... 11
Section 4.1 Investment. ................................ 11
Section 4.2 Rule 144. .................................. 11
Section 4.3 Organization of Purchaser. ................. 11
Section 4.4 Authority of Purchaser. .................... 12
Section 4.5 Non-Contravention. ......................... 12
Section 4.6 Title to the Notes. ........................ 12
ARTICLE V
CONDITIONS TO THE OBLIGATIONS OF THE PARTIES.......................... 13
Section 5.1 General Conditions to Obligations of
the Purchasers. ............................ 13
Section 5.2 Registration Rights Agreement. ............. 13
Section 5.3 Officers' Certificates. .................... 13
Section 5.4 Opinions. .................................. 13
Section 5.5 Certificate of Designation. ................ 14
Section 5.6 Material Adverse Effect. ................... 14
Section 5.7 [Intentionally Left Blank]................... 14
Section 5.8 General Conditions to the Obligations
of the Company. ............................ 14
Section 5.9 No Injunction. ............................. 14
Section 5.10 HSR Waiting Period. ........................ 15
Section 5.11 Shareholder Approval. ...................... 15
Section 5.12 Receipt of Consents. ....................... 15
ARTICLE VI
COVENANTS OF THE COMPANY.................................... 15
Section 6.1 Reporting. ................................. 15
Section 6.2 Payment of Expenses. ....................... 15
Section 6.3 Inspection. ................................ 16
Section 6.4 Availability of Common Stock. .............. 16
Section 6.5 Transaction Fee. ........................... 16
Section 6.6 Fleet Bank Consent. ........................ 16
Section 6.7 Proxy Statements; Stockholder Ap-
provals. ................................... 16
Section 6.8 Election to Board of Directors of the
Company. ................................... 17
Section 6.9 No General Solicitation. ................... 19
ARTICLE VII
COVENANTS OF THE PURCHASERS.................................. 19
Section 7.1 Certain Restrictions. ...................... 19
ARTICLE VIII
RESTRICTIONS ON TRANSFERABILITY OF SECURITIES.................... 21
Section 8.1 Restrictive Legend. ........................ 21
Section 8.2 Notice of Proposed Transfers. .............. 22
ARTICLE IX
TERMINATION.......................................... 23
ARTICLE X
INDEMNIFICATION........................................ 23
Section 10.1 Indemnification. ........................... 23
Section 10.2 Terms of Indemnification. .................. 24
ARTICLE XI
MISCELLANEOUS......................................... 25
Section 11.1 Governing Law. ............................. 25
Section 11.2 Survival. .................................. 25
Section 11.3 Successors and Assigns. .................... 25
Section 11.4 Entire Agreement; Amendment. ............... 26
Section 11.5 Notices, Etc. .............................. 26
Section 11.6 Delays or Omissions. ....................... 26
Section 11.7 Counterparts. .............................. 27
Section 11.8 Severability. .............................. 27
Section 11.9 Titles and Subtitles. ...................... 27
Section 11.10 No Public Announcement. .................... 27
Section 11.11 Reasonable Efforts. ........................ 27
Section 11.12 Distributions and Adjustments................ 27
Exhibits
- --------
Exhibit A - Certificate of Designation
Exhibit B - Registration Rights Agreement
Exhibit C - Opinion of Counsel for the Company
Exhibit D - Opinion of Hale and Dorr LLP
SECURITIES PURCHASE AGREEMENT
This SECURITIES PURCHASE AGREEMENT (this "Agreement") is made
as of August 26, 1997 between The Learning Company, Inc., a Delaware corporation
(the "Company"), and each of the Purchasers listed on the signature pages hereto
(individually, a "Purchaser" and collectively, the "Purchasers").
The Company is simultaneously entering into securities
purchase agreements (the "Other Purchase Agreements" and, together with this
Agreement, the "Purchase Agreements") with affiliates of Thomas H. Lee Company
and Centre Partners Management LLC (together, the "Other Purchasers") dated the
date hereof. The Purchase Agreements provide, subject to the terms and
conditions thereof, for the purchase by the Purchasers and the Other Purchasers
of an aggregate of 750,000 shares of Series A Convertible Participating
Preferred Stock, par value $.01 per share, of the Company having the terms set
forth in the Certificate of Designation (the "Certificate of Designation")
attached hereto as Exhibit A (the "Preferred Stock") in exchange for the
surrender of the Company's 5 1/2% Senior Convertible/Exchangeable Notes due 2000
(the "Notes") in an aggregate principal amount of $150,000,000 then to be held
by the Purchasers and the Other Purchasers.
In consideration of the mutual covenants, agreements,
representations and warranties herein set forth, it is hereby agreed between the
Company and the Purchasers as follows:
ARTICLE I
AUTHORIZATION AND SALE OF SHARES
SECTION 1.1 AUTHORIZATION. Subject to the obtaining of any
requisite stockholder approval referred to in Section 5.11, the Company has
heretofore authorized the issuance and sale to the Purchasers pursuant to this
Agreement of an aggregate of 170,732 shares of the Preferred Stock (the
"Shares") and to the Other Purchasers pursuant to the Other Purchase Agreements
of an aggregate of 579,268 shares of Preferred Stock (the "Other Shares").
SECTION 1.2 ISSUANCE AND SALE OF SHARES. Upon the terms and
subject to the conditions set forth herein, on the Closing Date (as defined
below), (a) the Company will issue and sell to the Purchasers and, in reliance
on the representations and warranties of the Company contained herein, the
Purchasers will purchase from the Company the Shares in exchange for Notes in an
aggregate principal amount of $34,146,400 then to be held by the Purchasers
delivered free and clear of all liens, encumbrances, equities or claims and (b)
the Company will make a cash payment to the Purchasers by wire transfer of
immediately available funds in an amount equal to the interest accrued on the
Notes sold to the Company by the Purchasers from the last interest payment date
on the Notes up to and including the Closing Date (as defined below).
ARTICLE II
CLOSING
SECTION 2.1 CLOSING DATE. The closing (the "Closing") of the
purchase and sale of the Shares contemplated hereby shall take place on such
date and at such time as agreed to by the Company and the Purchasers but in no
event later than three business days following the date upon which all of the
conditions set forth in Article V and all the conditions to closing in the Note
Purchase Agreement (as defined below) are satisfied or waived (the date of the
Closing is hereinafter referred to as the "Closing Date"). The Closing shall be
held at the offices of Skadden, Arps, Slate, Meagher & Flom LLP, One Beacon
Street, Boston, Massachusetts, or at such other place as agreed to by the
Company and the Purchasers. The Closing shall occur simultaneously with the
closing of the transactions contemplated by the Other Purchase Agreements and
the Securities Purchase Agreement among Tribune Company, the Purchasers and the
Other Purchasers dated the date hereof (the "Note Purchase Agreement") and the
closing of each shall be conditioned on the closing of the others.
Delivery of the Shares to be purchased by the Purchasers
pursuant to this Agreement shall be made at the Closing by the Company
delivering to each Purchaser, against payment of the purchase price
therefor, one certificate representing the appropriate number of Shares
(registered in the name of such Purchaser or such other person which shall
be an affiliate of such Purchaser or a nominee of such Purchaser or such
affiliate as such Purchaser may have designated in writing to the Company
at least one business day prior to the Closing Day), unless at least two
business days prior to the Closing Date such Purchaser shall have requested
that the Company deliver more than one certificate representing the Shares,
in which event the Company will deliver to each Purchaser the number of
certificates so requested, registered in such name or names specified in
such request (subject to the foregoing limitation). Payment of the purchase
price for the Shares to be purchased hereunder shall be made by the
Purchaser by delivery of Notes in the aggregate principal amount of
$34,146,400 to the Company duly endorsed for transfer to the Company with
all signatures guaranteed by stock powers or other evidence of transfer
reasonably acceptable to the Company.
SECTION 2.2 FURTHER ASSURANCES. From time to time following
the Closing, upon the request of any Purchaser, the Company shall execute
and deliver, or cause to be executed and delivered, to such Purchaser such
other instruments and take such other action as may be reasonably necessary
to more effectively vest in such Purchaser and put the Purchaser in
possession of the shares of common stock par value $.01 per share, of the
Company (the "Common Stock") issuable upon conversion of the Shares. The
Company shall cooperate with the Purchasers in obtaining as soon as
practicable all necessary governmental consents and approvals, including
approvals under the Hart-Scott-Rodino Antitrust Improvements Act of 1976,
as amended (the "HSR Act").
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
As an inducement to the Purchasers to enter into this
Agreement and to consummate the transactions contemplated hereby, the Company
represents and warrants to each of the Purchasers as follows:
SECTION 3.1 SEC REPORTS. The Company has filed all documents
required to be filed since January 1, 1995 with the Securities and Exchange
Commission (the "Commission") (the "SEC Reports"). As of their respective
dates, the SEC Reports complied in all material respects with the
requirements of the Securities Act of 1933, as amended (including the rules
and regulations promulgated thereunder, the "Securities Act"), and the
Securities Exchange Act of 1934, as amended (including the rules and
regulations promulgated thereunder, the "Exchange Act"), as the case may
be, and none of the SEC Reports contained any untrue statement of a
material fact or omitted to state a material fact required to be stated
therein, in order to make the statements contained therein, in light of the
circumstances under which they were made, not misleading.
SECTION 3.2 ACCOUNTANTS. Coopers & Lybrand L.L.P., Arthur
Andersen LLP, KPMG Peat Marwick LLP, Price Waterhouse LLP and Deloitte &
Touche LLP, who have expressed their respective opinions with respect to
the financial statements and schedules included in the SEC Reports, are
independent accountants as required by the Securities Act.
SECTION 3.3 FINANCIAL STATEMENTS. (a) The annual audited
financial statements of the Company included in the relevant Report on Form 10-
K for the period ended January 4, 1997 (the "10-K") present fairly in all
material respects the financial position of the Company, as of the respective
date of such financial statements, and the results of operations and changes in
cash flows of the Company for the respective periods covered thereby. Such
statements and related notes have been prepared in accordance with generally
accepted accounting principles applied on a consistent basis, in each case, as
certified by one or more of the independent accountants named in Section 3.2.
(b) The unaudited interim financial statements of the Company
included in the Company's Quarterly Report on Form 10-Q for the period ended
July 5, 1997 (the "Second Quarter 10-Q") present fairly in all material respects
the financial position of the Company, as of the respective dates of such
financial statements, and the results of operations and changes in cash flows of
the Company for the respective periods covered thereby. Such statements and
related notes have been prepared in accordance with generally accepted
accounting principles applied on a consistent basis except for normal year-end
adjustments and the omission of certain footnote disclosure.
SECTION 3.4 ABSENCE OF CERTAIN CHANGES. Except as disclosed in
Section 3.4 of a letter dated the date hereof from and previously delivered
by the Company to the Purchasers (the "Disclosure Letter"), (a) since the
date of the latest balance sheet presented in the Second Quarter 10-Q there
has been no material adverse change in the business, properties, prospects,
operations, condition (financial or other) or results of operations of the
Company and its Subsidiaries (as defined herein) taken as a whole, whether
or not arising from transactions in the ordinary course of business,
provided that a decline in the trading price of the Common Stock shall not
be deemed to be such a material adverse change if such decline is not
attributable to a material adverse change in the business, properties,
operations, prospects, condition (financial or other) or results of
operations of the Company and its Subsidiaries taken as a whole, (b) since
the date of the latest balance sheet presented in the Second Quarter 10-Q,
neither the Company nor any of its Subsidiaries has incurred or undertaken
any liabilities or obligations, direct or contingent, except for (i)
liabilities or obligations which are reflected in the Second Quarter 10-Q
and (ii) the transactions contemplated by this Agreement and the Other
Purchase Agreements, (iii) contractual liabilities incurred in the ordinary
course of business, (iv) other liabilities that would not have a material
adverse effect on the business, properties, prospects, operations,
condition (financial or other) or results of operations of the Company and
its subsidiaries taken as a whole and (v) liabilities incurred in
connection with any acquisition of another business entity made by the
Company after the date hereof.
SECTION 3.5 AUTHORITY. The Company has all necessary corporate
power and corporate authority to enter into this Agreement, the Other Purchase
Agreements and the other agreements, documents and instruments to be executed by
the Company in furtherance of the transactions contemplated hereby and thereby,
including without limitation, the Registration Rights Agreement between the
Company and the Purchasers, a form of which is attached hereto as Exhibit B (the
"Registration Rights Agreement") (collectively, the "Transaction Documents"),
and to consummate the transactions contemplated hereby and thereby.
SECTION 3.6 NON-CONTRAVENTION. The execution, delivery, and
performance of the Transaction Documents by the Company and the
consummation of the transactions contemplated thereby by the Company do not
and will not (a) result in a breach of any of the terms and provisions of,
or constitute a default (or an event which with notice or lapse of time, or
both, would constitute a default) under, or result in the creation or
imposition of any lien, charge or encumbrance upon any property or assets
of the Company or any of its Subsidiaries (as defined below) pursuant to
any agreement, instrument, franchise, license or permit to which the
Company or any of its Subsidiaries is a party or by which any of such
corporations or their respective properties or assets may be bound or (b)
violate any judgment, decree, order, statute, rule or regulation of any
court or any public, governmental or regulatory agency or body applicable
to the Company or any of its Subsidiaries or any of their respective
properties or assets, other than such breaches, defaults or violations that
are not reasonably expected to impair the ability of the Company to
consummate the transactions contemplated by this Agreement. The execution,
delivery and performance of the Transaction Documents by the Company and
the consummation of the transactions contemplated thereby do not and will
not violate or conflict with any provision of the certificate of
incorporation or by-laws of the Company or any of its Subsidiaries, as
currently in effect. Except as set forth in Section 3.6 of the Disclosure
Letter, no consent, approval, authorization, order, registration, filing,
qualification, license or permit of or with any court or any government
agency or body applicable to the Company or any of its Subsidiaries or any
of their respective properties or assets is required for the execution,
delivery and performance of the Transaction Documents or the consummation
of the transactions contemplated thereby, including the issuance, sale and
delivery of the Shares to be issued, sold and delivered by the Company
hereunder.
SECTION 3.7 CAPITALIZATION. The Company had, as of July 5,
1997, an authorized and outstanding capitalization as set forth in the Second
Quarter 10-Q.
SECTION 3.8 SUBSIDIARIES. Except for the subsidiaries listed
in Section 3.8 of the Disclosure Letter, the Company does not own or control,
directly or indirectly, any "significant subsidiary" within the meaning of
Regulation S-X of the Commission. The subsidiaries listed in Section 3.8 of the
Disclosure Letter are hereinafter referred to as the "Subsidiaries." Each of the
Company and its Subsidiaries has been duly organized and is validly existing as
a corporation in good standing under the laws of its jurisdiction of
incorporation. Each of the Company and its Subsidiaries is duly qualified to do
business and in good standing as a foreign corporation in each jurisdiction in
which the character or location of its properties (owned, lease or licensed) or
the nature or conduct of its business makes such qualification necessary, except
for those failures to be so qualified or in good standing which will not in the
aggregate have a material adverse effect on the Company and its Subsidiaries
taken as a whole. The Company owns all of the outstanding capital stock of each
of its Subsidiaries, other than the non-voting exchangeable shares of SoftKey
Software Products Inc. and qualifying shares of certain Subsidiaries organized
outside the United States, free and clear of all claims, liens, charges and
encumbrances other than as disclosed in Section 3.8 of the Disclosure Letter.
Each of the Company and its Subsidiaries has all requisite power and authority,
and all necessary consents, approvals, authorizations, orders, registrations,
qualifications, licenses and permits of and from all public, regulatory or
governmental agencies and bodies, to own, lease and operate its properties and
conduct its business as now being conducted, except where the failure to possess
such requisite power and authority would not have a material adverse effect on
the business, properties, prospects, operations, condition (financial or other)
or results of operations of the Company and its Subsidiaries taken as a whole.
SECTION 3.9 ACTIONS. Except as described in Section 3.9 of the
Disclosure Letter, there is no litigation or governmental proceeding to which
the Company or any of its Subsidiaries is a party or to which any property of
the Company or any of its Subsidiaries is subject or which is pending or, to the
knowledge of the Company, threatened against the Company or any of its
Subsidiaries which could reasonably be expected to have a material adverse
effect on the business, properties, prospects, operations, condition (financial
or other) or results of operations of the Company and its Subsidiaries taken as
a whole.
SECTION 3.10 INVESTMENT COMPANY ACT. Neither the Company nor
any of its Subsidiaries is (i) an "investment company" or a company "controlled"
by an investment company within the meaning of the Investment Company Act of
1940, as amended, (ii) a "holding company" or a "subsidiary company" of a
holding company or an "affiliate" thereof within the meaning of the Public
Utility Holding Company Act of 1935, as amended, or (iii) subject to regulation
under the Federal Power Act, the Interstate Commerce Act or any federal or state
statute or regulation limiting its ability to consummate the transactions
contemplated hereby.
SECTION 3.11 REPORTING. The Company is subject to Section 13
of the Exchange Act and is in compliance in all material respects with the
provisions of such section.
SECTION 3.12 REGISTRATION AND QUALIFICATION. Assuming the
accuracy of the representations and warranties made by each of the Purchasers
and set forth in Article IV hereof, it is not necessary in connection with the
offer, sale and delivery of the Shares to the Purchasers in the manner
contemplated by this Agreement to register the Shares or the shares of Common
Stock issuable upon conversion of the Shares, under the Securities Act.
SECTION 3.13 NO LIABILITIES. Neither the Company nor its
Subsidiaries has any liabilities or obligations (direct or indirect,
contingent or absolute, known or unknown, matured or unmatured) of any
nature whatsoever, whether arising out of contract, tort, statute or
otherwise ("Liabilities"), except (i) as reflected or reserved against in
the latest balance sheet of the Company presented in the Second Quarter
10-Q and not heretofore discharged, (ii) as set forth in Section 3.13 of
the Disclosure Letter, (iii) liabilities incurred in the ordinary course of
business since the date of the latest balance sheet presented in the Second
Quarter 10-Q, (iv) contractual liabilities incurred in the ordinary course
of business, (v) liabilities incurred in connection with any acquisition of
another business entity made by the Company after the date hereof or (vi)
other liabilities that would not have a material adverse effect on the
business, properties, prospects, operations, condition (financial or other)
or results of operations of the Company and its subsidiaries taken as a
whole.
SECTION 3.14 NO DEFAULTS. Except as disclosed in Section 3.14
of the Disclosure Letter, neither the Company nor any of its Subsidiaries is in
violation or default under any provision of its certificate of incorporation,
by-laws or other organization documents, or is in breach of or default with
respect to any provision of any agreement, judgment, decree, order, mortgage,
deed of trust, lease, franchise, license, indenture, permit or other instrument
to which it is a party or by which it or any of its properties are bound; and
there does not exist an event of default on the part of the Company or any such
Subsidiary as defined in such documents which, with notice or lapse of time or
both, would constitute a default, which such violation or default, in either
such case, would not have a material adverse effect on the business, properties,
prospects, operations, condition (financial or other) or results of operations
of the Company and its subsidiaries taken as a whole.
SECTION 3.15 VIOLATIONS OF LAW. The Company and its
Subsidiaries are in compliance, and have complied at all times during the past
three years, and all transactions pursuant to the Transaction Documents shall
comply with all applicable federal, state and local statutes, codes, ordinances,
rules and regulations of the United States and all other countries and
subdivisions thereof (the "Laws") to the extent applicable, other than
violations which would not have a material adverse effect on the business,
properties, operations, condition (financial or other) or results of operations
of the Company and its Subsidiaries taken as a whole. Neither the Company nor
any of its Subsidiaries has received notice within the past three years of any
violations of any Laws, which violations would be material to the Company and
its subsidiaries taken as a whole.
SECTION 3.16 ENFORCEABILITY OF AGREEMENT. This Agreement has
been, and the other agreements to be executed and delivered by the Company
pursuant hereto have been or will be, duly and validly authorized, executed and
delivered by the Company and this Agreement is, and such other agreements when
so executed and delivered will be, valid and binding obligations of the Company,
enforceable against the Company in accordance with their terms.
SECTION 3.17 THE CAPITAL STOCK. (a) All of the outstanding
shares of Common Stock are duly and validly authorized and issued, fully
paid and nonassessable, have been issued in compliance with all federal and
state securities laws, and were not issued and are not now in violation of
or subject to any preemptive rights. All issued and outstanding shares of
capital stock of each Subsidiary have been duly authorized and validly
issued and are fully paid and nonassessable. Except as disclosed in Section
3.17 of the Disclosure Letter as of the date hereof, neither the Company
nor any Subsidiary has outstanding any options to purchase, or any
preemptive rights or other rights to subscribe for or to purchase, any
securities or obligations convertible into, or any contracts or commitments
to issue or sell, shares of its capital stock or any such options, rights,
convertible securities or obligations. There are currently no shares of the
Company's preferred stock outstanding.
(b) (i) The Shares have been duly and validly authorized by
the Company and the Shares, when issued, sold and delivered in accordance
with this Agreement, will be duly and validly issued, fully paid and
nonassessable. The shares of Common Stock issuable upon conversion of the
Shares have been duly and validly authorized by the Company and, when
issued in accordance with the terms of the Shares, will be duly and validly
issued, fully paid and nonassessable. The shares of Common Stock issuable
on conversion of the Shares at the initial conversion price have been
reserved for issuance, and no further approval or authority of the
stockholders or the Board of Directors of the Company (the "Board of
Directors") under the Delaware General Corporation Law will be required for
such issuance of Common Stock following the Closing. No preemptive rights
or other rights to subscribe for or purchase securities exist with respect
to the issuance and sale of the Shares by the Company pursuant to this
Agreement or the issuance of Common Stock on conversion of the Shares.
(ii) Except as set forth in Section 3.17 of the Disclosure
Letter, no security holder of the Company has any right which has not been
satisfied or waived to require the Company to register the sale of any
securities owned by such security holder under the Securities Act.
SECTION 3.18 PROPERTIES. The Company or the applicable
Subsidiary holds its leased properties under valid and binding leases, with such
exceptions as are not materially significant in relation to the business of the
Company. Except as disclosed in Section 3.18 of the Disclosure Letter, the
Company owns or leases all such properties as are necessary to its operations as
now conducted.
SECTION 3.19 INTELLECTUAL PROPERTY. Except as disclosed in
Section 3.19 of the Disclosure Letter, the Company and its Subsidiaries have
sufficient trademarks, trade names, patent rights, copyrights, licenses,
approvals and governmental authorizations to conduct their businesses
substantially as now conducted; and the Company has no knowledge of any
infringement by it or its Subsidiaries of any trademark, trade name, patent,
copyright, licenses, trade secret or other similar rights of others, and there
is no claim being made against the Company or its Subsidiaries regarding
trademark, trade name, patent, copyright, license, trade secret or other
infringement, in any such case which could reasonably be expected to have a
material adverse effect on the business, properties, prospects, operations,
condition (financial or otherwise) or results of operations of the Company and
it or its Subsidiaries taken as a whole.
SECTION 3.20 TAXES. The Company and its Subsidiaries have
filed all necessary federal, state and foreign income and franchise tax returns
and have paid all taxes shown as due thereon; and the Company has no knowledge
of any tax deficiency which has been asserted or threatened against the Company
or its Subsidiaries which could have a material adverse effect on the business,
properties, prospects, operations, condition (financial or otherwise) or results
of operations of the Company and its Subsidiaries taken as a whole.
SECTION 3.21 INSURANCE. The Company and its Subsidiaries
maintain insurance of the types and in the amounts generally deemed adequate for
its business and that of its Subsidiaries against theft, damage, destruction,
acts of vandalism and all other risks customarily insured against, all of which
insurance is in full force and effect.
SECTION 3.22 CERTAIN PAYMENTS. To the knowledge of the
Company, neither the Company nor any of its Subsidiaries has at any time (i)
made any unlawful contribution to any candidate for foreign office, or failed to
disclose fully any contribution in violation of law or (ii) made any payment to
any federal or state governmental officer or official, or other person charged
with similar public or quasi-public duties, other than payments required or
permitted by the laws of the United States or any jurisdiction thereof.
SECTION 3.23 DELAWARE GENERAL CORPORATION LAW SECTION 203.
Section 203 of the Delaware General Corporation Law will not, prior to the
termination of this Agreement and the Other Purchase Agreements, apply to such
Agreements or the transactions contemplated hereby and thereby.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE PURCHASERS
As an inducement to the Company to enter into this Agreement
and to consummate the transactions contemplated hereby, each of the Purchasers
hereby represents and warrants to the Company as follows:
SECTION 4.1 INVESTMENT. Purchaser is acquiring the Shares and
the shares of Common Stock issuable upon conversion of the Shares for investment
for its own account, and not with a view to any distribution thereof. Purchaser
understands that the Shares and the shares of Common Stock issuable upon
conversion of the Shares have not been registered under the Securities Act by
reason of specific exemptions therefrom which depend upon, among other things,
the bona fide nature of the investment intent and the accuracy of Purchaser's
representations as expressed herein.
Purchaser's financial condition and investments are such that
it is in a position to hold the Shares and the shares of Common Stock issuable
upon conversion of the Shares for an indefinite period, bear the economic risks
of the investment and to withstand the complete loss of the investment.
Purchaser has extensive knowledge and experience in financial and business
matters and has the capability to evaluate the merits and risks of any Shares
and the shares of Common Stock issuable upon conversion of the Shares. Purchaser
qualifies as an "accredited investor" as such term is defined in Section 2(15)
of the Securities Act and Regulation D promulgated thereunder.
SECTION 4.2 RULE 144. Purchaser acknowledges that the Shares
and the shares of Common Stock issuable upon conversion of the Shares must be
held indefinitely unless subsequently registered under the Securities Act or any
applicable state securities laws or unless exemptions from such registrations
are available. Purchaser is aware of the provisions of Rule 144 promulgated
under the Securities Act which permit limited resale of securities purchased in
a private placement subject to the satisfaction of certain conditions.
SECTION 4.3 ORGANIZATION OF PURCHASER. Purchaser is duly
organized and validly existing under the laws of the jurisdiction of its
organization.
SECTION 4.4 AUTHORITY OF PURCHASER. Purchaser has the power
and authority (corporate or similar) to execute and deliver this Agreement, to
consummate the transactions contemplated hereby and to comply with the terms,
conditions and provisions hereof.
The execution, delivery and performance of this Agreement by
Purchaser has been duly authorized and approved by Purchaser and does not
require any further authorization or consent of Purchaser or its beneficial
owners. This Agreement is the legal, valid and binding agreement of Purchaser,
enforceable against Purchaser in accordance with its terms.
SECTION 4.5 NON-CONTRAVENTION. The execution, delivery and
performance of this Agreement by Purchaser and the consummation of any of the
transactions contemplated hereby by Purchaser will not (a) conflict with or
result in a breach of any of the terms and provisions of, or constitute a
default (or an event which with notice or lapse of time, or both, would
constitute a default) under, or result in the creation or imposition of any
lien, charge or encumbrance upon any property or assets of Purchaser pursuant to
any agreement, instrument, franchise, license or permit to which Purchaser is a
party or by which any of its properties or assets may be bound or (b) violate or
conflict with any judgment, decree, order, statute, rule or regulation of any
court or any public, governmental or regulatory agency or body applicable to
Purchaser or any of its properties or assets, other than such breaches, defaults
or violations that are not reasonably expected to impair the ability of
Purchaser to consummate the transactions contemplated by this Agreement. The
execution, delivery and performance of this Agreement by Purchaser and the
consummation of the transactions contemplated hereby by Purchaser do not and
will not violate or conflict with any provision of the organizational documents
of Purchaser, as currently in effect. Except for filings under the HSR Act, no
consent, approval, authorization, order, registration, filing, qualification,
license or permit of or with any court or any government agency or body
applicable to Purchaser is required for the execution, delivery and performance
of this Agreement or the consummation of the transactions contemplated hereby.
SECTION 4.6 TITLE TO THE NOTES. Upon consummation of the
transactions contemplated by the Note Purchase Agreement, the Purchasers
will have good and valid title to the Notes to be surrendered to the
Company hereunder, free and clear of all liens, encumbrances, equities or
claims; and, upon delivery of the Notes to the Company, good and valid
title to the Notes, free and clear of all liens, encumbrances, equities or
claims, will pass to the Company, assuming that the Company is acquiring
the Notes in good faith and without notice of any "adverse claims" within
the meaning of Article 8 of the Uniform Commercial Code.
ARTICLE V
CONDITIONS TO THE OBLIGATIONS OF THE PARTIES
A. OBLIGATIONS OF THE PURCHASERS
SECTION 5.1 GENERAL CONDITIONS TO OBLIGATIONS OF THE
PURCHASERS. The obligation of each of the Purchasers to consummate the
transactions contemplated herein is subject to the accuracy of the
representations and warranties of the Company herein contained, as of the date
hereof and as of the Closing Date, and to the performance in all material
respects by the Company of its obligations hereunder (including the covenants
contained in Article VI of this Agreement).
SECTION 5.2 REGISTRATION RIGHTS AGREEMENT. The obligation of
each of the Purchasers to consummate the transactions contemplated herein is
subject to the Registration Rights Agreement continuing to be in full force and
effect.
SECTION 5.3 OFFICERS' CERTIFICATES. The obligation of each of
the Purchasers to consummate the transactions contemplated herein is subject to
each of the Purchasers at the Closing Date receiving a certificate of the Chief
Executive Officer and Chief Financial Officer of the Company, dated the Closing
Date, to the effect that (i) as of the date hereof and as of the Closing Date,
the representations and warranties of the Company set forth in Article III
hereof are accurate and (ii) as of the Closing Date, the obligations of the
Company to be performed hereunder on or prior to the Closing Date have been
duly performed in all material respects.
SECTION 5.4 OPINIONS. The obligation of each of the Purchasers
to consummate the transactions contemplated herein is subject to each of the
Purchasers receiving at the Closing Date the opinion of Neal S. Winneg, General
Counsel for the Company, to the effect of the matters set forth in Exhibit C and
the opinion of Hale and Dorr LLP, special counsel for the Company, to the effect
of the matters set forth in Exhibit D.
SECTION 5.5 CERTIFICATE OF DESIGNATION. The obligation of each
of the Purchasers to consummate the transactions contemplated herein is subject
to the Certificate of Designation attached hereto as Exhibit A being duly
adopted by the Company and filed with the Secretary of State of the State of
Delaware.
SECTION 5.6 MATERIAL ADVERSE EFFECT. The obligation of each of
the Purchasers to consummate the transactions contemplated herein is subject to
there being since the date of the last balance sheet presented in the Second
Quarter 10-Q no fact or condition which would have, or insofar as reasonably can
be foreseen could have, a material adverse effect on the business, properties,
prospects, operations, condition (financial or other) or results of operations
of the Company and its Subsidiaries taken as a whole; provided, that a decline
in the trading price of the Common Stock shall not be deemed to be such a
material adverse effect if such decline is not attributable to a material
adverse change in the business, properties, prospects, operations, condition
(financial or other) or results of operations of the Company and its
subsidiaries taken as a whole.
SECTION 5.7 [Intentionally Left Blank].
B. OBLIGATIONS OF THE COMPANY
SECTION 5.8 GENERAL CONDITIONS TO THE OBLIGATIONS OF THE
COMPANY. The obligation of the Company to sell the Shares to each of the
Purchasers shall be subject to the accuracy of the representations and
warranties of each of the Purchasers herein contained except to the extent any
inaccuracies do not materially impair the ability of the Purchasers to
consummate the transaction contemplated by the Agreement, as of the date hereof
and as of the Closing Date, and to the performance in all material respects by
each of the Purchasers of its obligations hereunder.
C. OBLIGATIONS OF EACH OF THE COMPANY AND THE PURCHASERS
SECTION 5.9 NO INJUNCTION. The obligations of each of the
Company and the Purchasers to consummate the transactions contemplated
herein are subject to the condition that no temporary restraining order,
preliminary or permanent injunction or other order issued by any court of
competent jurisdiction prohibiting or preventing consummation of the
transactions contemplated herein shall be in effect.
SECTION 5.10 HSR WAITING PERIOD. The obligations of each of
the Company and the Purchasers to consummate the transactions contemplated
herein are subject to the condition of the expiration or early termination of
the application waiting periods under the HSR.
SECTION 5.11 SHAREHOLDER APPROVAL. The obligations of each of
the Company and the Purchasers to consummate the transactions contemplated
herein are subject to the approval of the issuance of the Shares, the Other
Shares and the shares of Common Stock issuable upon conversion of the
Shares and the Other Shares by the Company's stockholders in accordance
with the requirements of the New York Stock Exchange ("NYSE").
SECTION 5.12 RECEIPT OF CONSENTS. The obligation of each of
the Company and the Purchasers to consummate the transactions contemplated by
this Agreement are subject to the receipt by the Company of all governmental or
third-party consents shown in Section 5.12 of the Disclosure Letter the
transactions.
ARTICLE VI
COVENANTS OF THE COMPANY
As an inducement to the Purchasers to enter into this
Agreement and to consummate the transactions contemplated hereby, the Company
hereby covenants with each of the Purchasers as follows:
SECTION 6.1 REPORTING. The Company will, so long as the Shares
or the shares of Common Stock issuable upon conversion thereof are outstanding
and are "restricted securities" within the meaning of Rule 144(a)(3) under the
Securities Act, file reports and other information with the Commission under
Section 13 or 15 (d) of the Exchange Act.
SECTION 6.2 PAYMENT OF EXPENSES. Whether or not the
transactions contemplated in this Agreement are consummated or this
Agreement is terminated, the Company hereby agrees to pay (i) all costs and
expenses incident to the performance of the obligations of the Company
hereunder, including those in connection with (a) the issuance, transfer
and delivery of the Shares or the shares of Common Stock issuable upon
conversion thereof to each of the Purchasers, including any transfer or
similar taxes payable therein, (b) the qualification of Shares or the
shares of Common Stock issuable upon conversion thereof under state or
foreign securities or Blue Sky laws, (c) the cost of printing the Shares or
the shares of Common Stock issuable upon conversion thereof and (d) the
cost and charges of any transfer agent, registrar, trustee or fiscal paying
agent and to promptly pay (ii) all documented out-of-pocket costs and
expenses, including attorneys', accountants' and consultants' fees,
incurred by each of the Purchasers in connection with the negotiation and
consummation of this Agreement, the Note Purchase Agreement, the
Registration Rights Agreement and the transactions contemplated thereby up
to $800,000 in the aggregate for all Purchasers and Other Purchasers under
this Section 6.2 and Section 6.2 of the Other Purchase Agreements.
SECTION 6.3 INSPECTION. Prior to and following the Closing,
the Company will permit each of the Purchasers and their representatives to
visit and inspect any of the Company's properties, to examine its books and
records and to make copies and to take extracts therefrom, and to discuss its
business affairs and finances with its officers and key employees, all at such
reasonable times as the Purchasers may request.
SECTION 6.4 AVAILABILITY OF COMMON STOCK. The Company shall at
all times reserve and keep available out of its authorized but unissued
Common Stock, for the purpose of effecting the conversion of the Shares,
the full number of shares of Common Stock then issuable upon the conversion
of the Shares. The Company will, from time to time, in accordance with the
laws of the State of Delaware, increase the authorized amount of Common
Stock if at any time the number of shares of Common Stock remaining
unissued and available for issuance shall be insufficient to permit
conversion of the Shares.
SECTION 6.5 TRANSACTION FEE. Upon the execution of this
Agreement, the Company shall pay the Purchasers an aggregate fee equal to
$140,000. On the Closing Date, the Company shall pay the Purchasers an
additional aggregate fee equal to $280,000.
SECTION 6.6 FLEET BANK CONSENT. The Company will use its best
efforts to obtain the consent of Fleet Bank of Massachusetts, N.A. referred to
in Section 5.12 of the Disclosure Letter, within 10 days after the date hereof.
SECTION 6.7 PROXY STATEMENTS; STOCKHOLDER APPROVALS. The
Company acting through the Board of Directors, shall, in accordance with
applicable law and its Certificate of Incorporation and By-Laws:
(a) promptly and duly call, give notice of, convene and hold
as soon as practicable following the clearance of the proxy statement to be
issued in connection with the transactions contemplated herein (the "Proxy
Statement") with the SEC, but in no event later than the Closing Date, a
meeting of its stockholders for the purpose of voting to approve the
issuance of the Shares and the shares of Common Stock issuable upon
conversion thereof and shall use its best efforts, except to the extent the
Board of Directors determines in good faith, after consultation with
outside counsel, that contrary action is required by the Board of
Directors' fiduciary duties under applicable law, to obtain stockholder
approval;
(b) except to the extent the Board of Directors determines in
good faith, after consultation with outside counsel, that contrary action is
required by the Board of Directors' fiduciary duties under applicable law,
recommend approval of the issuance of the Shares and the shares of Common Stock
issuable upon conversion thereof, and include in the Proxy Statement such
recommendation, and take all lawful action to solicit such approvals; and
(c) as promptly as practicable following the signing of this
Agreement, prepare and file with the SEC a preliminary Proxy Statement and
respond to any comments of the SEC with respect to the preliminary Proxy
Statement and cause the definitive Proxy Statement to be mailed to its
stockholders.
SECTION 6.8 ELECTION TO BOARD OF DIRECTORS OF THE COMPANY.
Simultaneously with the Closing, the Company shall (a) take all actions
necessary to ensure that one representative of each of the following
Purchaser groups is appointed to the Board of Directors promptly after the
consummation of the transactions contemplated herein: (i) Thomas H. Lee
Equity Fund III, L.P., Thomas H. Lee Foreign Fund III, L.P., Thomas H. Lee
Company and affiliates (collectively, the "Lee Purchaser Group"); (ii) Bain
Capital Fund V, L.P., Bain Capital Fund V-B, L.P., BCIP Associates, L.P.,
BCIP Trust Associates, L.P. and affiliates (collectively, the "Bain
Purchaser Group"); and (iii) Centre Capital Investors II, L.P., Centre
Capital Tax-Exempt Investors II, L.P., Centre Capital Offshore Investors
II, L.P., State Board of Administration of Florida, Centre Parallel
Management Partners, L.P., Centre Partners Coinvestment, L.P. and
affiliates (collectively, the "Centre Purchaser Group"); (b) use best
efforts to cause each of the directors appointed in accordance with
subsection (a) hereof and the representative of the Thomas H. Lee Company
currently serving on the Board of Directors (and any successor nominees
thereof) (collectively, the "Purchasers' Representatives") to be
renominated and reelected when their initial and any subsequent term
expires, (c) use best efforts to cause the election of two nominees from
the four Purchasers' Representatives to each of the executive, compensation
and audit committees of the Board of Directors, in each case except to the
extent the Board of Directors determines in good faith, after consultation
with outside counsel, that contrary action is required by the Board of
Directors' fiduciary duties under applicable law; provided, however that if
(i) the Lee Purchaser Group, in the aggregate, holds less than 40% or 20%
of the Shares initially owned by the Lee Purchaser Group (or if any of such
Shares have been converted and after making appropriate adjustment for any
stock dividend, split-up, recapitalization, rights, merger or other change
in the corporate or capital structure of the Company (a "Restructuring"),
shares of Common Stock and shares of Common Stock issuable upon conversion
of the Shares representing less than 40% or 20% of the Common Stock
originally issuable upon conversion of the Shares), the Lee Purchaser Group
shall only be entitled to nominate one or no such nominees to the Board of
Directors, respectively; (ii) the Bain Purchaser Group holds less than 40%
of the Shares initially owned by the Bain Purchaser Group (or if any of
such Shares have been converted and after making appropriate adjustment for
any Restructuring, shares of Common Stock and Shares of Common Stock
issuable upon conversion of the Shares representing less than 40% of the
Common Stock originally issuable upon conversion of the Shares), the Bain
Purchaser Group shall not be entitled to nominate any nominees to the Board
of Directors; and (iii) the Centre Purchaser Group holds less than 40% of
the Shares initially owned by the Centre Purchaser Group (or if any of such
Shares have been converted and after making appropriate adjustment for any
Restructuring, shares of Common Stock and shares of Common Stock issuable
upon conversion of the Shares representing less than 40% of the Common
Stock originally issuable upon conversion of the Shares), the Centre
Purchaser Group shall not be entitled to nominate any nominees to the Board
of Directors; and provided, further that (i) if at any time there are only
two Purchasers' Representatives serving on the Board of Directors, the
Company will use its best efforts to cause the election of only one of such
Purchasers' Representatives to each of the executive, compensation and
audit committee and (ii) if at any time there is only one Purchasers'
Representative serving on the Board of Directors, the Company is not
obligated to use its best efforts to cause the election of such Purchasers'
Representative to any of the committees. Each of the Purchasers and the
Other Purchasers will designate the representatives who will sit on the
executive, compensation and audit committees of the Board of Directors
based on a vote of a majority in interest of the Purchasers and the Other
Purchasers.
SECTION 6.9 NO GENERAL SOLICITATION. None of the Company, its
affiliates (as defined in Rule 501(b) of the Securities Act) or any person
acting on their behalf will solicit any offer to buy or offer or sell the
Shares by means of any form or general solicitation or general advertising
(as those terms are used in Regulation D under the Securities Act) or in
any manner involving a public offering within the meaning of Section 4(2)
of the Securities Act that would require the registration of the Shares
under the Securities Act.
ARTICLE VII
COVENANTS OF THE PURCHASERS
SECTION 7.1 CERTAIN RESTRICTIONS.
(a) Each of the Purchasers covenants with the Company that,
without the consent of the Company, for a period commencing on the date hereof
and continuing through the fifth anniversary of the date hereof, none of the
Purchasers, singly or as part of a group, directly or indirectly, through one or
more intermediaries or otherwise, will:
(i) purchase or acquire, or offer, propose or agree to
purchase or acquire, directly or indirectly, any of the Common Stock
(other than by conversion of any of the Shares), any option, warrant or
other right to acquire, directly or indirectly, any Common Stock or any
securities which are convertible into or exchangeable or exercisable
for Common Stock (other than the exercise of options under the Stock
Option Agreement dated the date hereof; provided, however, that
notwithstanding anything to the contrary contained herein, the
foregoing restriction shall not be deemed to be violated or applicable
if a Purchaser is not otherwise in breach of this Agreement and (A) the
amount of the outstanding Common Stock beneficially owned, in the
aggregate, by such Purchaser is increased as a result of any stock
dividend, stock split, split-up, recapitalization, merger or other
change in the corporate or capital structure of the Company or any
other action taken solely by the Company or (B) the Company breaches
its obligations under Section 6.8 hereof; and provided, further, that
at any time when the percentage of the outstanding Common Stock owned
by a Purchaser on a fully diluted basis is less than the percentage of
the outstanding Common Stock owned by such Purchaser on a fully diluted
basis on the Closing Date (the "Maximum Amount") such Purchaser may
purchase additional shares of Common Stock up to the Maximum Amount;
(ii) solicit, or encourage any other person to solicit,
"proxies" or become a "participant" or otherwise engage in any
"solicitation" (as such terms are defined or used in Regulation 14A
under the Exchange Act) in opposition to a recommendation of a majority
of the directors of the Company with respect to any matter; seek to
advise or influence any person (within the meaning of Section 13(d)(3)
of the Exchange Act) with respect to the voting of any securities of
the Company; or execute any written consent in lieu of a meeting of
holders of securities of the Company or any class thereof;
(iii) initiate, propose or otherwise solicit stockholders for
the approval of one or more stockholder proposals with respect to the
Company, as described in Rule 14a-8 under the Exchange Act;
(iv) except as results from the Purchase Agreements or from
arrangements among the Purchasers and the Other Purchasers, directly or
indirectly participate in or encourage the formation of any "group"
(within the meaning of Section 13(d)(3) of the Exchange Act) owning or
seeking to acquire beneficial ownership of securities of the Company or
affect control of the Company;
(v) except as results from the Purchase Agreements or from
arrangements among the Purchasers and the Other Purchasers, otherwise
act, directly or indirectly, alone or in concert with others, to seek
to control or influence in any manner the management, business,
operations, board of directors, policies or affairs of the Company, or
propose or seek to effect any form of business combination transaction
with the Company or any affiliate thereof or any restructuring,
recapitalization or other similar transaction with respect to the
Company; or
(vi) (a) encourage any person, firm, corporation, group or
other entity to engage in any of the actions covered by clauses (i)
through (v) of this Section 7.1 or make any public arrangement (or make
other communication with or to the Company or otherwise which, in the
opinion of counsel to the Company, would require public announcement)
with respect to any matter set forth in clause (i) through (v) of this
Section 7.1; provided, however, that actions taken by any
representative of the Purchaser on the Board of Directors of the
Company, acting in his or her capacity as such a director, shall not
violate this Section 7.1.
(b) No Purchaser shall, without the Company's
consent, sell, transfer, effect a short sale of, grant any option for
the purchase of, or loan any Shares or Common Stock for a period of 18
months from the date of issuance of the Shares except to an affiliate
or the Other Purchasers or an affiliate thereof; provided that this
restriction on each Purchaser's ability to sell or transfer any Shares
will cease to apply upon a conversion of the Shares pursuant to Section
8.10.1 of the Certificate of Designation; provided further, that each
Purchaser may sell its Shares or Common Stock in any tender offer or
exchange offer made for any Company securities.
ARTICLE VIII
RESTRICTIONS ON TRANSFERABILITY OF SECURITIES
SECTION 8.1 RESTRICTIVE LEGEND. Each certificate representing
(a) the Shares, (b) shares of the Common Stock issuable upon conversion of
any Shares, and (c) any other securities issued in respect of the Shares or
Common Stock issued upon conversion of any Shares upon any stock split,
stock dividend, recapitalization, merger, consolidation or similar event
(each of the foregoing securities in (a) through (c) being referred to
herein as "Restricted Securities"), shall (unless otherwise permitted by
the provisions of Section 8.2 below) be stamped or otherwise imprinted with
a legend substantially in the following form (in addition to the legend
required under any applicable state securities laws):
THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE BEEN ACQUIRED
FOR INVESTMENT AND HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933 OR ANY APPLICABLE STATE SECURITIES LAWS. SUCH SHARES MAY NOT BE
SOLD OR TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATIONS OR EXEMPTIONS
THEREFROM UNDER SAID ACT OR LAWS. COPIES OF THE AGREEMENT COVERING THE
PURCHASE OF THESE SHARES AND THEIR TRANSFER MAY BE OBTAINED AT NO
COST BY WRITTEN REQUEST MADE BY THE HOLDER OF RECORD OF THIS
CERTIFICATE TO THE SECRETARY OF THE COMPANY.
The Company will promptly, upon request, remove any such legend when no longer
required by the terms of this Agreement or by applicable law.
SECTION 8.2 NOTICE OF PROPOSED TRANSFERS. Prior to any
proposed transfer of any Restricted Securities, unless there is in effect a
registration statement under the Securities Act covering the proposed
transfer, the Purchaser proposing such a transfer shall give written notice
to the Company of its intention to effect such transfer. Each such notice
shall describe the manner and circumstances of the proposed transfer in
sufficient detail, and shall be accompanied by either (a) a written opinion
of legal counsel (who shall be reasonably satisfactory to the Company)
addressed to the Company to the effect that the proposed transfer of the
Restricted Securities may be effected without registration under the
Securities Act or (b) a "no action" letter from the Commission to the
effect that the transfer of such securities without registration will not
result in a recommendation by the staff of the Commission that action be
taken with respect thereto, whereupon, in each case, such Purchaser shall
be entitled to transfer such Restricted Securities in accordance with the
terms of the notice delivered by such Purchaser to the Company. Unless
there is in effect a registration statement under the Securities Act
covering the proposed transfer, each certificate evidencing the Restricted
Securities transferred as herein provided shall bear the appropriate
restrictive legend set forth in Section 8.1 above except that such
certificate shall not bear such restrictive legend if, (i) in the opinion
of counsel for such Purchaser, such legend is not required in order to
establish compliance with any provisions of the Securities Act, (ii) a
period of at least one year has elapsed since the later of the date the
Restricted Securities were acquired from the Company or from an affiliate
of the Company, and such Purchaser represents to the Company that it is not
an affiliate of the Company and has not been an affiliate during the
preceding three months and shall not become an affiliate of the Company
without resubmitting the Restricted Securities for reimposition of the
legend, or (iii) the restricted Securities have been sold pursuant to Rule
144(k) and the certificate is accompanied by a representation by such
Purchaser that it is not an affiliate of the Company, has not been an
affiliate during the three-month period prior to the sale and has held the
Restricted Securities for more than two years.
ARTICLE IX
TERMINATION
Notwithstanding anything contained herein to the contrary,
this Agreement may be terminated at any time prior to the Closing Date:
(a) by the mutual written consent of the Purchasers and the
Company;
(b) by any Purchaser or the Company if the Closing has not
occurred on or before six months from the date hereof and this Agreement
has not previously been terminated; provided, however, that the right to
terminate the Agreement under this Section 9(b) shall not be available to
any party whose failure to fulfill any obligation under this Agreement has
been the cause of, or resulted in, the failure of the Closing to occur on
or before such date; or
(c) by any Purchaser or the Company if any of the Other
Purchase Agreements or the Note Purchase Agreement are terminated; or
(d) by any Purchaser 10 days after the Company's shareholders,
at a duly held meeting at which such shareholders vote on the issuance of
the Preferred Stock to the Purchasers or the Other Purchasers, fail to
approve such issuance.
In the event that this Agreement shall be terminated pursuant
to this Article IX, all further obligations of the parties under this
Agreement other than the obligations set forth in Article X and Sections
6.2, 6.5 and 11.10 shall be terminated without further liability of any
party to any other party, provided that nothing herein shall relieve any
party from liability for its willful breach of this Agreement.
ARTICLE X
INDEMNIFICATION
SECTION 10.1 INDEMNIFICATION. The Company hereby agrees to
indemnify, defend and hold harmless each Purchaser from and against all
demands, claims, actions or causes of action, assessments, losses, damages,
liabilities, costs and expenses (collectively, "Claims"), including without
limitation, interest, penalties and attorneys' fees and expenses, asserted
against, resulting to, or imposed upon or incurred by such Purchaser
directly or indirectly, in connection with the transactions contemplated
hereby.
SECTION 10.2 TERMS OF INDEMNIFICATION. The obligations and
liabilities of the Company with respect to Claims by third parties will be
subject to the following terms and conditions:
(a) a Purchaser will give the Company prompt notice of any
Claims asserted against, resulting to, imposed upon or incurred by a
Purchaser, directly or indirectly, and the Company will undertake the
defense thereof by representatives of their own choosing which are
reasonably satisfactory to such Purchaser; provided that the failure of any
Purchaser to give notice as provided in this Section 10.2 shall not relieve
the Company of its obligations under this Article X, except to the extent
that such failure has materially and adversely affected the rights of the
Company;
(b) if within a reasonable time after notice of any Claim, the
Company fails to defend, such Purchaser will have the right to undertake
the defense, compromise or settlement of such Claims on behalf of and for
the account and at the risk of the Company, subject to the right of the
Company to assume the defense of such Claim at any time prior to
settlement, compromise or final determination thereof;
(c) if there is a reasonable probability that a Claim may
materially and adversely affect a Purchaser other than as a result of money
damages or other money payments, such Purchaser will have the right at its
own expense to defend (provided that the indemnifying party shall continue
to control the defense and the indemnified party shall have the right to
participate in such defense), or co-defend, such Claim;
(d) the Company on one hand and the Purchasers on the other
will not, without the prior written consent of the other, settle or
compromise any Claim or consent to entry of any judgment relating to any
such Claim;
(e) with respect to any Claims asserted against a Purchaser,
such Purchaser will have the right to employ one counsel of its choice in
each applicable jurisdiction (if more than one jurisdiction is involved) to
represent such Purchaser if, in such Purchaser's reasonable judgment, a
conflict of interest between such Purchaser and the indemnifying party
exists in respect of such Claims, and in that event the fees and expenses
of such separate counsel shall be paid by such indemnifying party;
(f) the Company will provide each Purchaser reasonable access
to all records and documents of the Company relating to any Claim; and
(g) any Claim, in so far as it is related to any of the
representations and warranties of the Company contained in this Agreement,
must be made within one year of the Closing Date.
ARTICLE XI
MISCELLANEOUS
SECTION 11.1 GOVERNING LAW. This Agreement shall be governed
by and construed in accordance with the laws of the Commonwealth of
Massachusetts, without regard to the conflict of laws rules thereof.
SECTION 11.2 SURVIVAL. All representations and warranties,
covenants and agreements of the Company and any Purchaser contained in this
Agreement shall remain operative and in full force and effect regardless of
any investigation made by or on behalf of any Purchaser or any controlling
person thereof or by or on behalf of the Company, any of its officers and
directors or any controlling person thereof, and such representations and
warranties shall survive for a period of one year from the Closing Date
hereof.
SECTION 11.3 SUCCESSORS AND ASSIGNS. Except as otherwise
provided herein, the provisions hereof shall inure to the benefit of, and
be binding upon, the successors and permitted assigns of the parties
hereto. No assignment of this Agreement may be made by either party at any
time, whether or not by operation of law, without the other party's prior
written consent, except that each Purchaser may assign any of its rights
hereunder to an affiliate of such Purchaser or to the Other Purchasers or
any of their affiliates without the Company's consent provided that such
affiliate expressly assumes in writing all of the purchaser's obligations
hereunder, and provided that such assignment shall not relieve the
assigning Purchaser of its obligations hereunder.
SECTION 11.4 ENTIRE AGREEMENT; AMENDMENT. This Agreement and
the Transaction Documents constitute the full and entire understanding and
agreement between the parties with regard to the subjects hereof and thereof
provided that the Confidentiality Agreement between the Purchasers and the
Company dated April 18, 1997 shall remain in effect. Except as expressly
provided herein, neither this Agreement nor any term hereof may be amended,
waived, discharged or terminated other than by a written instrument signed by
the party against whom enforcement of any such amendment, waiver, discharge or
termination is sought.
SECTION 11.5 NOTICES, ETC. All notices and other
communications provided for or permitted hereunder shall be made in writing
by hand-delivery, first-class mail (registered or certified, return
receipt requested), telex, telecopier or courier guaranteeing overnight
delivery, addressed (a) if to the Purchasers to Bain Capital, Inc. at Two
Copley Place, Boston, Massachusetts 02116, Attention: Mark Nunnelly, or at
such other addresses as shall have been furnished to the Company with a
copy to Louis A. Goodman of Skadden, Arps, Slate, Meagher & Flom LLP at One
Beacon Street, Boston, Massachusetts 02108 and (b) if to the Company, at
One Athenaeum Street, Cambridge, Massachusetts 02142, Attention: Mr. Neal
S. Winneg, or at such other address as the Company shall have furnished to
the Purchaser in writing with a copy to Mark G. Borden at Hale and Dorr
LLP, 60 State Street, Boston, Massachusetts 02109. All such notices and
communications shall be deemed to have been duly given: at the time
delivered by hand, if personally delivered; five business days after being
deposited in the mail, postage prepaid, if mailed; when answered back, if
telexed; when receipt is acknowledged, if telecopied; and on the next
business day, if timely delivered to a courier guaranteeing overnight
delivery.
SECTION 11.6 DELAYS OR OMISSIONS. Except as expressly provided
herein, no delay or omission to exercise any right, power or remedy
accruing to the Company or any of the Purchasers upon any breach or default
of any party under this Agreement, shall impair any such right, power or
remedy of the Company or any of the Purchasers nor shall it be construed to
be a waiver of any such breach or default, or an acquiescence therein, or
of or in any similar breach or default thereafter occurring; nor shall any
waiver of any single breach or default be deemed a waiver of any other
breach or default theretofore or thereafter occurring. Any waiver, permit,
consent or approval of any kind or character on the part of the Company or
any of the Purchasers of any breach or default under this Agreement, or any
waiver on the part of any such party of any provisions or conditions of
this Agreement, must be in writing and shall be effective only to the
extent specifically set forth in such writing. All remedies, either under
this Agreement or by law or otherwise afforded to the Company or any of the
Purchasers, shall be cumulative and not alternative.
SECTION 11.7 COUNTERPARTS. This Agreement may be executed in
any number of counterparts, each of which may be executed by only one of the
parties hereto, each of which shall be enforceable against the party actually
executing such counterpart, and all of which together shall constitute one
instrument.
SECTION 11.8 SEVERABILITY. In the event that any provision of
this Agreement becomes or is declared by a court of competent jurisdiction
to be illegal, unenforceable or void, this Agreement shall continue in full
force and effect without said provisions; provided that no such
severability shall be effective if it materially changes the economic
benefit of this Agreement to any party.
SECTION 11.9 TITLES AND SUBTITLES. The titles and subtitles
used in this Agreement are used for convenience only and are not to be
considered in construing or interpreting this Agreement.
SECTION 11.10 NO PUBLIC ANNOUNCEMENT. Neither the Company nor
any of the Purchasers shall make any press release or other public
announcement concerning the transactions contemplated by this Agreement
except as and to the extent that any such party shall be obligated to make
any such disclosure by law or by the NYSE and then only after consultation
with the other regarding the basis of such obligation and the content of
such press release or other public announcement or as the parties shall
mutually agree.
SECTION 11.11 REASONABLE EFFORTS. The Company and the
Purchasers shall use all reasonable efforts to consummate the transactions
contemplated by this Agreement, the Other Purchase Agreements and the Note
Purchase Agreement.
SECTION 11.12 DISTRIBUTIONS AND ADJUSTMENTS. If from July 5,
1997 through the Closing Date the Company shall have taken any action which
would entitle the holders of Preferred Stock to a distribution or adjustment in
accordance with the Certificate of Designation if the Preferred Stock were then
outstanding, then the consideration to be received by the Purchasers hereunder
shall be appropriately adjusted.
IN WITNESS WHEREOF, each of the undersigned has caused the
foregoing Agreement to be executed under seal by one of its duly authorized
officers as of the date first above written.
THE LEARNING COMPANY, INC
By /s/ R. Scott Murray
-----------------------------------
Name: R. Scott Murray
Title: Executive Vice President and
Chief Financial Officer
BAIN CAPITAL FUND V, L.P.
By: Bain Capital Partners V, L.P.,
as General Partner
By: Bain Capital Investors V, Inc.,
as General Partner
By: /s/ Mark E. Nunnelly
--------------------------------
Name: Mark E. Nunnelly
Title: Managing Director
BAIN CAPITAL FUND V-B, L.P.
By: Bain Capital Partners V, L.P.,
as General Partner
By: Bain Capital Investors V, Inc.,
as General Partner
By: /s/ Mark E. Nunnelly
--------------------------------
Name: Mark E. Nunnelly
Title: Managing Director
BCIP ASSOCIATES, L.P.
By: /s/ Mark E. Nunnelly
--------------------------------
Name: Mark E. Nunnelly
Title: General Partner
BCIP TRUST ASSOCIATES, L.P.
By: /s/ Mark E. Nunnelly
--------------------------------
Name: Mark E. Nunnelly
Title: Managing Director
Amendment to Securities Purchase Agreement
Amendment dated as of September 16, 1997 to Securities
Purchase Agreement dated as of August 26, 1997 (the "Agreement")
between The Learning Company, Inc., a Delaware corporation (the
"Company") and each of the Purchasers listed on the signature page
hereto (individually, a "Purchaser" and collectively, the
"Purchasers").
For valuable consideration, receipt of which is hereby
acknowledged, the parties hereto hereby agree that Section 8.4 of the
Certificate of Designation of Series A Convertible Participating
Preferred Stock setting forth the powers, preferences, rights,
qualifications, limitations and restrictions of such series of
Preferred Stock, attached as Exhibit A to the Agreement, is hereby
amended to read in its entirety as follows:
"Section 8.4 Conversion Price. The initial conversion price
shall be the lower of (i) $10.00 or (ii) the weighted average (based
on daily trading volumes of the Common Stock on the New York Stock
Exchange) of the Closing Prices of the Common Stock for the period of
the 30 consecutive Trading Days immediately preceding the Trading Day
which is three Trading Days before the date on which the proxy
statement is sent to the Company's stockholders with respect to the
approval of the Company's stockholders with respect to the approval of
the issuance of the Series A Preferred Stock (herein called the
"Conversion Price") subject to adjustment as provided in this Section
8."
In all other respects, the Agreement shall remain in full
force and effect.
Executed as of September 16, 1997.
THE LEARNING COMPANY, INC.
By: /s/ R. Scott Murray
-----------------------------------
Name: R. Scott Murray
Title: Executive Vice President and
Chief Financial Officer
PURCHASERS:
BAIN CAPITAL FUND V, L.P.
By:
Bain Capital Partners V, L.P., as
General Partner
By: Bain Capital Investors V, Inc., as
General Partner
By: /s/ Mark E. Nunnelly
-----------------------------------
Name: Mark E. Nunnelly
Title: Managing Director
BAIN CAPITAL FUND V-B L.P.
By:
Bain Capital Partners V, L.P., as
General Partner
By:
Bain Capital Investors V, Inc., as
General Partner
By: /s/ Mark E. Nunnelly
-----------------------------------
Name: Mark E. Nunnelly
Title: Managing Director
BCIP ASSOCIATES, L.P.
By: /s/ Mark E. Nunnelly
-----------------------------------
Name: Mark E. Nunnelly
Title: General Partner
BCIP TRUST ASSOCIATES, L.P.
By: /s/ Mark E. Nunnelly
-----------------------------------
Name: Mark E. Nunnelly
Title: Managing Director
EXHIBIT B-3
SECURITIES PURCHASE AGREEMENT
Between
THE PURCHASERS NAMED HEREIN
and
THE LEARNING COMPANY, INC., as Issuer
Dated as of August 26, 1997
Series A Convertible Participating Preferred Stock
TABLE OF CONTENTS
Page
ARTICLE I
AUTHORIZATION AND SALE OF SHARES................................ 1
Section 1.1 Authorization................................ 1
Section 1.2 Issuance and Sale of Shares.................. 1
ARTICLE II
CLOSING...................................... 2
Section 2.1 Closing Date................................. 2
Section 2.2 Further Assurances........................... 3
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE COMPANY.................... 3
Section 3.1 SEC Reports.................................. 3
Section 3.2 Accountants.................................. 4
Section 3.3 Financial Statements......................... 4
Section 3.4 Absence of Certain Changes................... 4
Section 3.5 Authority.................................... 5
Section 3.6 Non-Contravention............................ 5
Section 3.7 Capitalization............................... 6
Section 3.8 Subsidiaries................................. 6
Section 3.9 Actions...................................... 7
Section 3.10 Investment Company Act....................... 7
Section 3.11 Reporting.................................... 7
Section 3.12 Registration and Qualification............... 7
Section 3.13 No Liabilities............................... 7
Section 3.14 No Defaults.................................. 8
Section 3.15 Violations of Law............................ 8
Section 3.16 Enforceability of Agreement.................. 8
Section 3.17 The Capital Stock............................ 8
Section 3.18 Properties................................... 9
Section 3.19 Intellectual Property........................ 10
Section 3.20 Taxes........................................ 10
Section 3.21 Insurance.................................... 10
Section 3.22 Certain Payments............................. 10
Section 3.23 Delaware General Corporation Law Section 203. 10
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE PURCHASERS.................. 11
Section 4.1 Investment................................... 11
Section 4.2 Rule 144..................................... 11
Section 4.3 Organization of Purchaser.................... 11
Section 4.4 Authority of Purchaser....................... 12
Section 4.5 Non-Contravention............................ 12
Section 4.6 Title of the Notes........................... 12
ARTICLE V
CONDITIONS TO THE OBLIGATIONS OF THE PARTIES.................... 13
Section 5.1 General Conditions to Obligations of
the Purchasers............................... 13
Section 5.2 Registration Rights Agreement................ 13
Section 5.3 Officers' Certificates....................... 13
Section 5.4 Opinions..................................... 13
Section 5.5 Certificate of Designation................... 14
Section 5.6 Material Adverse Effect...................... 14
Section 5.7 [Intentionally Left Blank]................... 14
Section 5.8 General Conditions to the Obligations
of the Company............................... 14
Section 5.9 No Injunction................................ 14
Section 5.10 HSR Waiting Period........................... 15
Section 5.11 Shareholder Approval......................... 15
Section 5.12 Receipt of Consents.......................... 15
ARTICLE VI
COVENANTS OF THE COMPANY.................................... 15
Section 6.1 Reporting.................................... 15
Section 6.2 Payment of Expenses.......................... 15
Section 6.3 Inspection................................... 16
Section 6.4 Availability of Common Stock................. 16
Section 6.5 Transaction Fee.............................. 16
Section 6.6 Fleet Bank Consent........................... 16
Section 6.7 Proxy Statements; Stockholder Approvals...... 16
Section 6.8 Election to Board of Directors of the
Company...................................... 17
Section 6.9 No General Solicitation...................... 19
ARTICLE VII
COVENANTS OF THE PURCHASERS.................................... 19
Section 7.1 Certain Restrictions......................... 19
ARTICLE VIII
RESTRICTIONS ON TRANSFERABILITY OF SECURITIES.................... 21
Section 8.1 Restrictive Legend........................... 21
Section 8.2 Notice of Proposed Transfers................. 22
ARTICLE IX
TERMINATION.......................................... 23
ARTICLE X
INDEMNIFICATION........................................ 23
Section 10.1 Indemnification.............................. 23
Section 10.2 Terms of Indemnification..................... 24
ARTICLE XI
MISCELLANEOUS......................................... 25
Section 11.1 Governing Law................................ 25
Section 11.2 Survival..................................... 25
Section 11.3 Successors and Assigns....................... 25
Section 11.4 Entire Agreement; Amendment.................. 26
Section 11.5 Notices, Etc................................. 26
Section 11.6 Delays or Omissions.......................... 26
Section 11.7 Counterparts................................. 27
Section 11.8 Severability................................. 27
Section 11.9 Titles and Subtitles......................... 27
Section 11.10 No Public Announcement....................... 27
Section 11.11 Reasonable Efforts........................... 27
Section 11.12 Distributions and Adjustments................ 27
Exhibits
Exhibit A - Certificate of Designation
Exhibit B - Registration Rights Agreement
Exhibit C - Opinion of Counsel for the Company
Exhibit D - Opinion of Hale and Dorr LLP
SECURITIES PURCHASE AGREEMENT
This SECURITIES PURCHASE AGREEMENT (this "Agreement") is made as of
August 26, 1997 between The Learning Company, Inc., a Delaware corporation (the
"Company"), and each of the Purchasers listed on the signature pages hereto
(individually, a "Purchaser" and collectively, the "Purchasers").
The Company is simultaneously entering into securities purchase
agreements (the "Other Purchase Agreements" and, together with this Agreement,
the "Purchase Agreements") with affiliates of Thomas H. Lee Company and Bain
Capital, Inc. (together, the "Other Purchasers") dated the date hereof. The
Purchase Agreements provide, subject to the terms and conditions thereof, for
the purchase by the Purchasers and the Other Purchasers of an aggregate of
750,000 shares of Series A Convertible Participating Preferred Stock, par value
$.01 per share, of the Company having the terms set forth in the Certificate of
Designation (the "Certificate of Designation") attached hereto as Exhibit A (the
"Preferred Stock") in exchange for the surrender of the Company's 5 1/2% Senior
Convertible/Exchangeable Notes due 2000 (the "Notes") in an aggregate principal
amount of $150,000,000 then to be held by the Purchasers and the Other
Purchasers.
In consideration of the mutual covenants, agreements, representations
and warranties herein set forth, it is hereby agreed between the Company and the
Purchasers as follows:
ARTICLE I
AUTHORIZATION AND SALE OF SHARES
SECTION 1.1 AUTHORIZATION. Subject to the obtaining of any requisite
stockholder approval referred to in Section 5.11, the Company has heretofore
authorized the issuance and sale to the Purchasers pursuant to this Agreement of
an aggregate of 121,951 shares of the Preferred Stock (the "Shares") and to the
Other Purchasers pursuant to the Other Purchase Agreements of an aggregate of
628,049 shares of Preferred Stock (the "Other Shares").
SECTION 1.2 ISSUANCE AND SALE OF SHARES. Upon the terms and subject to
the conditions set forth herein, on the Closing Date (as defined below),
(a) the Company will issue and sell to the Purchasers and, in reliance on the
representations and warranties of the Company contained herein, the Purchasers
will purchase from the Company the Shares in exchange for Notes in an aggregate
principal amount of $24,390,200 then to be held by the Purchasers delivered free
and clear of all liens, encumbrances, equities or claims and (b) the Company
will make a cash payment to the Purchasers by wire transfer of immediately
available funds in an amount equal to the interest accrued on the Notes sold to
the Company by the Purchasers from the last interest payment date on the Notes
up to and including the Closing Date (as defined below).
ARTICLE II
CLOSING
SECTION 2.1 CLOSING DATE. The closing (the "Closing") of the purchase
and sale of the Shares contemplated hereby shall take place on such date and at
such time as agreed to by the Company and the Purchasers but in no event later
than three business days following the date upon which all of the conditions set
forth in Article V and all the conditions to closing in the Note Purchase
Agreement (as defined below) are satisfied or waived (the date of the Closing is
hereinafter referred to as the "Closing Date"). The Closing shall be held at the
offices of Skadden, Arps, Slate, Meagher & Flom LLP, One Beacon Street, Boston,
Massachusetts, or at such other place as agreed to by the Company and the
Purchasers. The Closing shall occur simultaneously with the closing of the
transactions contemplated by the Other Purchase Agreements and the Securities
Purchase Agreement among Tribune Company, the Purchasers and the Other
Purchasers dated the date hereof (the "Note Purchase Agreement") and the closing
of each shall be conditioned on the closing of the others.
Delivery of the Shares to be purchased by the Purchasers pursuant to
this Agreement shall be made at the Closing by the Company delivering to
each Purchaser, against payment of the purchase price therefor, one
certificate representing the appropriate number of Shares (registered in
the name of such Purchaser or such other person which shall be an affiliate
of such Purchaser or a nominee of such Purchaser or such affiliate as such
Purchaser may have designated in writing to the Company at least one
business day prior to the Closing Day), unless at least two business days
prior to the Closing Date such Purchaser shall have requested that the
Company deliver more than one certificate representing the Shares, in which
event the Company will deliver to each Purchaser the number of certifi-
cates so requested, registered in such name or names specified in such
request (subject to the foregoing limitation). Payment of the purchase
price for the Shares to be purchased hereunder shall be made by the
Purchaser by delivery of Notes in the aggregate principal amount of
$24,390,200 to the Company duly endorsed for transfer to the Company with
all signatures guaranteed by stock powers or other evidence of transfer
reasonably acceptable to the Company.
SECTION 2.2 FURTHER ASSURANCES. From time to time following the
Closing, upon the request of any Purchaser, the Company shall execute and
deliver, or cause to be executed and delivered, to such Purchaser such
other instruments and take such other action as may be reasonably necessary
to more effectively vest in such Purchaser and put the Purchaser in
possession of the shares of common stock par value $.01 per share, of the
Company (the "Common Stock") issuable upon conversion of the Shares. The
Company shall cooperate with the Purchasers in obtaining as soon as
practicable all necessary governmental consents and approvals, including
approvals under the Hart-Scott-Rodino Antitrust Improvements Act of 1976,
as amended (the "HSR Act").
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
As an inducement to the Purchasers to enter into this Agreement and to
consummate the transactions contemplated hereby, the Company represents and
warrants to each of the Purchasers as follows:
SECTION 3.1 SEC REPORTS. The Company has filed all documents required
to be filed since January 1, 1995 with the Securities and Exchange Commission
(the "Commission") (the "SEC Reports"). As of their respective dates, the SEC
Reports complied in all material respects with the requirements of the
Securities Act of 1933, as amended (including the rules and regulations
promulgated thereunder, the "Securities Act"), and the Securities Exchange Act
of 1934, as amended (including the rules and regulations promulgated thereunder,
the "Exchange Act"), as the case may be, and none of the SEC Reports contained
any untrue statement of a material fact or omitted to state a material fact
required to be stated therein, in order to make the statements contained
therein, in light of the circumstances under which they were made, not
misleading.
SECTION 3.2 ACCOUNTANTS. Coopers & Lybrand L.L.P., Arthur Andersen LLP,
KPMG Peat Marwick LLP, Price Waterhouse LLP and Deloitte Touche LLP, who
have expressed their respective opinions with respect to the financial
statements and schedules included in the SEC Reports, are independent
accountants as required by the Securities Act.
SECTION 3.3 FINANCIAL STATEMENTS. (a) The annual audited financial
statements of the Company included in the relevant Report on Form 10-K for the
period ended January 4, 1997 (the "10-K") present fairly in all material
respects the financial position of the Company, as of the respective date of
such financial statements, and the results of operations and changes in cash
flows of the Company for the respective periods covered thereby. Such statements
and related notes have been prepared in accordance with generally accepted
accounting principles applied on a consistent basis, in each case, as certified
by one or more of the independent accountants named in Section 3.2.
(b) The unaudited interim financial statements of the Company included
in the Company's Quarterly Report on Form 10-Q for the period ended July 5, 1997
(the "Second Quarter 10-Q") present fairly in all material respects the
financial position of the Company, as of the respective dates of such financial
statements, and the results of operations and changes in cash flows of the
Company for the respective periods covered thereby. Such statements and related
notes have been prepared in accordance with generally accepted accounting
principles applied on a consistent basis except for normal year-end adjustments
and the omission of certain footnote disclosure.
SECTION 3.4 ABSENCE OF CERTAIN CHANGES. Except as disclosed in Section
3.4 of a letter dated the date hereof from and previously delivered by the
Company to the Purchasers (the "Disclosure Letter"), (a) since the date of
the latest balance sheet presented in the Second Quarter 10-Q there has
been no material adverse change in the business, properties, prospects,
operations, condition (financial or other) or results of operations of the
Company and its Subsidiaries (as defined herein) taken as a whole, whether
or not arising from transactions in the ordinary course of business,
provided that a decline in the trading price of the Common Stock shall not
be deemed to be such a material adverse change if such decline is not
attributable to a material adverse change in the business, properties,
operations, prospects, condition (financial or other) or results of
operations of the Company and its Subsidiaries taken as a whole, (b) since
the date of the latest balance sheet presented in the Second Quarter 10-Q,
neither the Company nor any of its Subsidiaries has incurred or undertaken
any liabilities or obligations, direct or contingent, except for (i)
liabilities or obligations which are reflected in the Second Quarter 10-Q
and (ii) the transactions contemplated by this Agreement and the Other
Purchase Agreements, (iii) contractual liabilities incurred in the ordinary
course of business, (iv) other liabilities that would not have a material
adverse effect on the business, properties, prospects, operations,
condition (financial or other) or results of operations of the Company and
its subsidiaries taken as a whole and (v) liabilities incurred in
connection with any acquisition of another business entity made by the
Company after the date hereof.
SECTION 3.5 AUTHORITY. The Company has all necessary corporate power
and corporate authority to enter into this Agreement, the Other Purchase
Agreements and the other agreements, documents and instruments to be
executed by the Company in furtherance of the transactions contemplated
hereby and thereby, including without limitation, the Registration Rights
Agreement between the Company and the Purchasers, a form of which is
attached hereto as Exhibit B (the "Registration Rights Agreement")
(collectively, the "Transaction Documents"), and to consummate the
transactions contemplated hereby and thereby.
SECTION 3.6 NON-CONTRAVENTION. The execution, delivery, and performance
of the Transaction Documents by the Company and the consummation of the
transactions contemplated thereby by the Company do not and will not (a)
result in a breach of any of the terms and provisions of, or constitute a
default (or an event which with notice or lapse of time, or both, would
constitute a default) under, or result in the creation or imposition of any
lien, charge or encumbrance upon any property or assets of the Company or
any of its Subsidiaries (as defined below) pursuant to any agreement,
instrument, franchise, license or permit to which the Company or any of its
Subsidiaries is a party or by which any of such corporations or their
respective properties or assets may be bound or (b) violate any judgment,
decree, order, statute, rule or regulation of any court or any public,
governmental or regulatory agency or body applicable to the Company or any
of its Subsidiaries or any of their respective properties or assets, other
than such breaches, defaults or violations that are not reasonably expected
to impair the ability of the Company to consummate the transactions
contemplated by this Agreement. The execution, delivery and performance of
the Transaction Documents by the Company and the consummation of the
transactions contemplated thereby do not and will not violate or conflict
with any provision of the certificate of incorporation or by-laws of the
Company or any of its Subsidiaries, as currently in effect. Except as set
forth in Section 3.6 of the Disclosure Letter, no consent, approval,
authorization, order, registration, filing, qualification, license or
permit of or with any court or any government agency or body applicable
to the Company or any of its Subsidiaries or any of their respective
properties or assets is required for the execution, delivery and
performance of the Transaction Documents or the consummation of the
transactions contemplated thereby, including the issuance, sale and
delivery of the Shares to be issued, sold and delivered by the Company
hereunder.
SECTION 3.7 CAPITALIZATION. The Company had, as of July 5, 1997, an
authorized and outstanding capitalization as set forth in the Second Quarter
10-Q.
SECTION 3.8 SUBSIDIARIES. Except for the subsidiaries listed in Section
3.8 of the Disclosure Letter, the Company does not own or control, directly
or indirectly, any "significant subsidiary" within the meaning of
Regulation S-X of the Commission. The subsidiaries listed in Section 3.8 of
the Disclosure Letter are hereinafter referred to as the "Subsidiaries."
Each of the Company and its Subsidiaries has been duly organized and is
validly existing as a corporation in good standing under the laws of its
jurisdiction of incorporation. Each of the Company and its Subsidiaries is
duly qualified to do business and in good standing as a foreign corporation
in each jurisdiction in which the character or location of its properties
(owned, lease or licensed) or the nature or conduct of its business makes
such qualification necessary, except for those failures to be so qualified
or in good standing which will not in the aggregate have a material adverse
effect on the Company and its Subsidiaries taken as a whole. The Company
owns all of the outstanding capital stock of each of its Subsidiaries,
other than the non-voting exchangeable shares of SoftKey Software Products
Inc. and qualifying shares of certain Subsidiaries organized outside the
United States, free and clear of all claims, liens, charges and
encumbrances other than as disclosed in Section 3.8 of the Disclosure
Letter. Each of the Company and its Subsidiaries has all requisite power
and authority, and all necessary consents, approvals, authorizations,
orders, registrations, qualifications, licenses and permits of and from all
public, regulatory or governmental agencies and bodies, to own, lease and
operate its properties and conduct its business as now being conducted,
except where the failure to possess such requisite power and authority
would not have a material adverse effect on the business, properties,
prospects, operations, condition (financial or other) or results of
operations of the Company and its Subsidiaries taken as a whole.
SECTION 3.9 ACTIONS. Except as described in Section 3.9 of the
Disclosure Letter, there is no litigation or governmental proceeding to
which the Company or any of its Subsidiaries is a party or to which any
property of the Company or any of its Subsidiaries is subject or which is
pending or, to the knowledge of the Company, threatened against the Company
or any of its Subsidiaries which could reasonably be expected to have a
material adverse effect on the business, properties, prospects, operations,
condition (financial or other) or results of operations of the Company and
its Subsidiaries taken as a whole.
SECTION 3.10 INVESTMENT COMPANY ACT. Neither the Company nor any of its
Subsidiaries is (i) an "investment company" or a company "controlled" by an
investment company within the meaning of the Investment Company Act of
1940, as amended, (ii) a "holding company" or a "subsidiary company" of a
holding company or an "affiliate" thereof within the meaning of the Public
Utility Holding Company Act of 1935, as amended, or (iii) subject to
regulation under the Federal Power Act, the Interstate Commerce Act or any
federal or state statute or regulation limiting its ability to consummate
the transactions contemplated hereby.
SECTION 3.11 REPORTING. The Company is subject to Section 13 of the
Exchange Act and is in compliance in all material respects with the provisions
of such section.
SECTION 3.12 REGISTRATION AND QUALIFICATION. Assuming the accuracy of
the representations and warranties made by each of the Purchasers and set
forth in Article IV hereof, it is not necessary in connection with the
offer, sale and delivery of the Shares to the Purchasers in the manner
contemplated by this Agreement to register the Shares or the shares of
Common Stock issuable upon conversion of the Shares, under the Securities
Act.
SECTION 3.13 NO LIABILITIES. Neither the Company nor its Subsidiaries
has any liabilities or obligations (direct or indirect, contingent or
absolute, known or unknown, matured or unmatured) of any nature whatsoever,
whether arising out of contract, tort, statute or otherwise
("Liabilities"), except (i) as reflected or reserved against in the latest
balance sheet of the Company presented in the Second Quarter 10-Q and not
heretofore discharged, (ii) as set forth in Section 3.13 of the Disclosure
Letter, (iii) liabilities incurred in the ordinary course of business since
the date of the latest balance sheet presented in the Second Quarter 10-Q,
(iv) contractual liabilities incurred in the ordinary course of business,
(v) liabilities incurred in connection with any acquisition of another
business entity made by the Company after the date hereof or (vi) other
liabilities that would not have a material adverse effect on the business,
properties, prospects, operations, condition (financial or other) or
results of operations of the Company and its subsidiaries taken as a whole.
SECTION 3.14 NO DEFAULTS. Except as disclosed in Section 3.14 of the
Disclosure Letter, neither the Company nor any of its Subsidiaries is in
violation or default under any provision of its certificate of
incorporation, by-laws or other organization documents, or is in breach of
or default with respect to any provision of any agreement, judgment,
decree, order, mortgage, deed of trust, lease, franchise, license,
indenture, permit or other instrument to which it is a party or by which it
or any of its properties are bound; and there does not exist an event of
default on the part of the Company or any such Subsidiary as defined in
such documents which, with notice or lapse of time or both, would
constitute a default, which such violation or default, in either such case,
would not have a material adverse effect on the business, properties,
prospects, operations, condition (financial or other) or results of
operations of the Company and its subsidiaries taken as a whole.
SECTION 3.15 VIOLATIONS OF LAW. The Company and its Subsidiaries are in
compliance, and have complied at all times during the past three years, and
all transactions pursuant to the Transaction Documents shall comply with
all applicable federal, state and local statutes, codes, ordinances, rules
and regulations of the United States and all other countries and
subdivisions thereof (the "Laws") to the extent applicable, other than
violations which would not have a material adverse effect on the business,
properties, operations, condition (financial or other) or results of
operations of the Company and its Subsidiaries taken as a whole. Neither
the Company nor any of its Subsidiaries has received notice within the past
three years of any violations of any Laws, which violations would be
material to the Company and its subsidiaries taken as a whole.
SECTION 3.16 ENFORCEABILITY OF AGREEMENT. This Agreement has been, and
the other agreements to be executed and delivered by the Company pursuant
hereto have been or will be, duly and validly authorized, executed and
delivered by the Company and this Agreement is, and such other agreements
when so executed and delivered will be, valid and binding obligations of
the Company, enforceable against the Company in accordance with their
terms.
SECTION 3.17 THE CAPITAL STOCK. (a) All of the outstanding shares of
Common Stock are duly and validly authorized and issued, fully paid and
nonassessable, have been issued in compliance with all federal and state
securities laws, and were not issued and are not now in violation of or
subject to any preemptive rights. All issued and outstanding shares of
capital stock of each Subsidiary have been duly authorized and validly
issued and are fully paid and nonassessable. Except as disclosed in Section
3.17 of the Disclosure Letter as of the date hereof, neither the Company
nor any Subsidiary has outstanding any options to purchase, or any
preemptive rights or other rights to subscribe for or to purchase, any
securities or obligations convertible into, or any contracts or commitments
to issue or sell, shares of its capital stock or any such options, rights,
convertible securities or obligations. There are currently no shares of the
Company's preferred stock outstanding.
(b) (i) The Shares have been duly and validly authorized by the
Company and the Shares, when issued, sold and delivered in accordance with this
Agreement, will be duly and validly issued, fully paid and nonassessable. The
shares of Common Stock issuable upon conversion of the Shares have been duly and
validly authorized by the Company and, when issued in accordance with the terms
of the Shares, will be duly and validly issued, fully paid and nonassessable.
The shares of Common Stock issuable on conversion of the Shares at the initial
conversion price have been reserved for issuance, and no further approval or
authority of the stockholders or the Board of Directors of the Company (the
"Board of Directors") under the Delaware General Corporation Law will be
required for such issuance of Common Stock following the Closing. No preemptive
rights or other rights to subscribe for or purchase securities exist with
respect to the issuance and sale of the Shares by the Company pursuant to this
Agreement or the issuance of Common Stock on conversion of the Shares.
(ii) Except as set forth in Section 3.17 of the Disclosure Letter,
no security holder of the Company has any right which has not been satisfied or
waived to require the Company to register the sale of any securities owned by
such security holder under the Securities Act.
SECTION 3.18 PROPERTIES. The Company or the applicable Subsidiary holds
its leased properties under valid and binding leases, with such exceptions as
are not materially significant in relation to the business of the Company.
Except as disclosed in Section 3.18 of the Disclosure Letter, the Company owns
or leases all such properties as are necessary to its operations as now
conducted.
SECTION 3.19 INTELLECTUAL PROPERTY. Except as disclosed in Section 3.19
of the Disclosure Letter, the Company and its Subsidiaries have sufficient
trademarks, trade names, patent rights, copyrights, licenses, approvals and
governmental authorizations to conduct their businesses substantially as
now conducted; and the Company has no knowledge of any infringement by it
or its Subsidiaries of any trademark, trade name, patent, copyright,
licenses, trade secret or other similar rights of others, and there is no
claim being made against the Company or its Subsidiaries regarding
trademark, trade name, patent, copyright, license, trade secret or other
infringement, in any such case which could reasonably be expected to have a
material adverse effect on the business, properties, prospects, operations,
condition (financial or otherwise) or results of operations of the Company
and it or its Subsidiaries taken as a whole.
SECTION 3.20 TAXES. The Company and its Subsidiaries have filed all
necessary federal, state and foreign income and franchise tax returns and
have paid all taxes shown as due thereon; and the Company has no knowledge
of any tax deficiency which has been asserted or threatened against the
Company or its Subsidiaries which could have a material adverse effect on
the business, properties, prospects, operations, condition (financial or
otherwise) or results of operations of the Company and its Subsidiaries
taken as a whole.
SECTION 3.21 INSURANCE. The Company and its Subsidiaries maintain
insurance of the types and in the amounts generally deemed adequate for its
business and that of its Subsidiaries against theft, damage, destruction, acts
of vandalism and all other risks customarily insured against, all of which
insurance is in full force and effect.
SECTION 3.22 CERTAIN PAYMENTS. To the knowledge of the Company, neither
the Company nor any of its Subsidiaries has at any time (i) made any unlawful
contribution to any candidate for foreign office, or failed to disclose fully
any contribution in violation of law or (ii) made any payment to any federal or
state governmental officer or official, or other person charged with similar
public or quasi-public duties, other than payments required or permitted by the
laws of the United States or any jurisdiction thereof.
SECTION 3.23 DELAWARE GENERAL CORPORATION LAW SECTION 203. Section 203
of the Delaware General Corporation Law will not, prior to the termination of
this Agreement and the Other Purchase Agreements, apply to such Agreements or
the transactions contemplated hereby and thereby.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE PURCHASERS
As an inducement to the Company to enter into this Agreement and to
consummate the transactions contemplated hereby, each of the Purchasers hereby
represents and warrants to the Company as follows:
SECTION 4.1 INVESTMENT. Purchaser is acquiring the Shares and the
shares of Common Stock issuable upon conversion of the Shares for
investment for its own account, and not with a view to any distribution
thereof. Purchaser understands that the Shares and the shares of Common
Stock issuable upon conversion of the Shares have not been registered under
the Securities Act by reason of specific exemptions therefrom which depend
upon, among other things, the bona fide nature of the investment intent and
the accuracy of Purchaser's representations as expressed herein.
Purchaser's financial condition and investments are such that it is in
a position to hold the Shares and the shares of Common Stock issuable upon
conversion of the Shares for an indefinite period, bear the economic risks of
the investment and to withstand the complete loss of the investment. Purchaser
has extensive knowledge and experience in financial and business matters and has
the capability to evaluate the merits and risks of any Shares and the shares of
Common Stock issuable upon conversion of the Shares. Purchaser qualifies as an
"accredited investor" as such term is defined in Section 2(15) of the Securities
Act and Regulation D promulgated thereunder.
SECTION 4.2 RULE 144. Purchaser acknowledges that the Shares and the
shares of Common Stock issuable upon conversion of the Shares must be held
indefinitely unless subsequently registered under the Securities Act or any
applicable state securities laws or unless exemptions from such registrations
are available. Purchaser is aware of the provisions of Rule 144 promulgated
under the Securities Act which permit limited resale of securities purchased in
a private placement subject to the satisfaction of certain conditions.
SECTION 4.3 ORGANIZATION OF PURCHASER. Purchaser is duly organized and
validly existing under the laws of the jurisdiction of its organization.
SECTION 4.4 AUTHORITY OF PURCHASER. Purchaser has the power and
authority (corporate or similar) to execute and deliver this Agreement, to
consummate the transactions contemplated hereby and to comply with the terms,
conditions and provisions hereof.
The execution, delivery and performance of this Agreement by Purchaser
has been duly authorized and approved by Purchaser and does not require any
further authorization or consent of Purchaser or its beneficial owners. This
Agreement is the legal, valid and binding agreement of Purchaser, enforceable
against Purchaser in accordance with its terms.
SECTION 4.5 NON-CONTRAVENTION. The execution, delivery and performance
of this Agreement by Purchaser and the consummation of any of the transactions
contemplated hereby by Purchaser will not (a) conflict with or result in a
breach of any of the terms and provisions of, or constitute a default (or an
event which with notice or lapse of time, or both, would constitute a default)
under, or result in the creation or imposition of any lien, charge or
encumbrance upon any property or assets of Purchaser pursuant to any agreement,
instrument, franchise, license or permit to which Purchaser is a party or by
which any of its properties or assets may be bound or (b) violate or conflict
with any judgment, decree, order, statute, rule or regulation of any court or
any public, governmental or regulatory agency or body applicable to Purchaser or
any of its properties or assets, other than such breaches, defaults or
violations that are not reasonably expected to impair the ability of Purchaser
to consummate the transactions contemplated by this Agreement. The execution,
delivery and performance of this Agreement by Purchaser and the consummation of
the transactions contemplated hereby by Purchaser do not and will not violate or
conflict with any provision of the organizational documents of Purchaser, as
currently in effect. Except for filings under the HSR Act, no consent, approval,
authorization, order, registration, filing, qualification, license or permit of
or with any court or any government agency or body applicable to Purchaser is
required for the execution, delivery and performance of this Agreement or the
consummation of the transactions contemplated hereby.
SECTION 4.6 TITLE TO THE NOTES. Upon consummation of the transactions
contemplated by the Note Purchase Agreement, the Purchasers will have good
and valid title to the Notes to be surrendered to the Company hereunder,
free and clear of all liens, encumbrances, equities or claims; and, upon
delivery of the Notes to the Company, good and valid title to the Notes,
free and clear of all liens, encumbrances, equities or claims, will pass to
the Company, assuming that the Company is acquiring the Notes in good faith
and without notice of any "adverse claims" within the meaning of Article 8
of the Uniform Commercial Code.
ARTICLE V
CONDITIONS TO THE OBLIGATIONS OF THE PARTIES
A. OBLIGATIONS OF THE PURCHASERS
SECTION 5.1 GENERAL CONDITIONS TO OBLIGATIONS OF THE PURCHASERS. The
obligation of each of the Purchasers to consummate the transactions contemplated
herein is subject to the accuracy of the representations and warranties of the
Company herein contained, as of the date hereof and as of the Closing Date, and
to the performance in all material respects by the Company of its obligations
hereunder (including the covenants contained in Article VI of this Agreement).
SECTION 5.2 REGISTRATION RIGHTS AGREEMENT. The obligation of each of
the Purchasers to consummate the transactions contemplated herein is subject to
the Registration Rights Agreement continuing to be in full force and effect.
SECTION 5.3 OFFICERS' CERTIFICATES. The obligation of each of the
Purchasers to consummate the transactions contemplated herein is subject to
each of the Purchasers at the Closing Date receiving a certificate of the Chief
Executive Officer and Chief Financial Officer of the Company, dated the Closing
Date, to the effect that (i) as of the date hereof and as of the Closing Date,
the representations and warranties of the Company set forth in Article III
hereof are accurate and (ii) as of the Closing Date, the obligations of the
Company to be performed hereunder on or prior to the Closing Date have been
duly performed in all material respects.
SECTION 5.4 OPINIONS. The obligation of each of the Purchasers to
consummate the transactions contemplated herein is subject to each of the
Purchasers receiving at the Closing Date the opinion of Neal S. Winneg, General
Counsel for the Company, to the effect of the matters set forth in Exhibit C and
the opinion of Hale and Dorr LLP, special counsel for the Company, to the effect
of the matters set forth in Exhibit D.
SECTION 5.5 CERTIFICATE OF DESIGNATION. The obligation of each of the
Purchasers to consummate the transactions contemplated herein is subject to the
Certificate of Designation attached hereto as Exhibit A being duly adopted by
the Company and filed with the Secretary of State of the State of Delaware.
SECTION 5.6 MATERIAL ADVERSE EFFECT. The obligation of each of the
Purchasers to consummate the transactions contemplated herein is subject to
there being since the date of the last balance sheet presented in the
Second Quarter 10-Q no fact or condition which would have, or insofar as
reasonably can be foreseen could have, a material adverse effect on the
business, properties, prospects, operations, condition (financial or other)
or results of operations of the Company and its Subsidiaries taken as a
whole; provided, that a decline in the trading price of the Common Stock
shall not be deemed to be such a material adverse effect if such decline is
not attributable to a material adverse change in the business, properties,
prospects, operations, condition (financial or other) or results of
operations of the Company and its subsidiaries taken as a whole.
SECTION 5.7 REGISTRATION RIGHTS AGREEMENT. [Intentionally Left Blank].
B. OBLIGATIONS OF THE COMPANY
SECTION 5.8 GENERAL CONDITIONS TO THE OBLIGATIONS OF THE COMPANY. The
obligation of the Company to sell the Shares to each of the Purchasers shall be
subject to the accuracy of the representations and warranties of each of the
Purchasers herein contained except to the extent any inaccuracies do not
materially impair the ability of the Purchasers to consummate the transaction
contemplated by the Agreement, as of the date hereof and as of the Closing
Date, and to the performance in all material respects by each of the Purchasers
of its obligations hereunder.
C. OBLIGATIONS OF EACH OF THE COMPANY AND THE PURCHASERS
SECTION 5.9 NO INJUNCTION. The obligations of each of the Company and
the Purchasers to consummate the transactions contemplated herein are
subject to the condition that no temporary restraining order, preliminary
or permanent injunction or other order issued by any court of competent
jurisdiction prohibiting or preventing consummation of the transactions
contemplated herein shall be in effect.
SECTION 5.10 HSR WAITING PERIOD. The obligations of each of the Company
and the Purchasers to consummate the transactions contemplated herein are
subject to the condition of the expiration or early termination of the
application waiting periods under the HSR.
SECTION 5.11 SHAREHOLDER APPROVAL. The obligations of each of the
Company and the Purchasers to consummate the transactions contemplated
herein are subject to the approval of the issuance of the Shares, the Other
Shares and the shares of Common Stock issuable upon conversion of the
Shares and the Other Shares by the Company's stockholders in accordance
with the requirements of the New York Stock Exchange ("NYSE").
SECTION 5.12 RECEIPT OF CONSENTS. The obligation of each of the Company
and the Purchasers to consummate the transactions contemplated by this
Agreement are subject to the receipt by the Company of all governmental or
third-party consents shown in Section 5.12 of the Disclosure Letter the
transactions.
ARTICLE VI
COVENANTS OF THE COMPANY
As an inducement to the Purchasers to enter into this Agreement and to
consummate the transactions contemplated hereby, the Company hereby covenants
with each of the Purchasers as follows:
SECTION 6.1 REPORTING. The Company will, so long as the Shares or the
shares of Common Stock issuable upon conversion thereof are outstanding and are
"restricted securities" within the meaning of Rule 144(a)(3) under the
Securities Act, file reports and other information with the Commission under
Section 13 or 15 (d) of the Exchange Act.
SECTION 6.2 PAYMENT OF EXPENSES. Whether or not the transactions
contemplated in this Agreement are consummated or this Agreement is
terminated, the Company hereby agrees to pay (i) all costs and expenses
incident to the performance of the obligations of the Company hereunder,
including those in connection with (a) the issuance, transfer and
delivery of the Shares or the shares of Common Stock issuable upon
conversion thereof to each of the Purchasers, including any transfer or
similar taxes payable therein, (b) the qualification of Shares or the
shares of Common Stock issuable upon conversion thereof under state or
foreign securities or Blue Sky laws, (c) the cost of printing the Shares or
the shares of Common Stock issuable upon conversion thereof and (d) the
cost and charges of any transfer agent, registrar, trustee or fiscal paying
agent and to promptly pay (ii) all documented out-of-pocket costs and
expenses, including attorneys', accountants' and consultants' fees,
incurred by each of the Purchasers in connection with the negotiation and
consummation of this Agreement, the Note Purchase Agreement, the
Registration Rights Agreement and the transactions contemplated thereby up
to $800,000 in the aggregate for all Purchasers and Other Purchasers under
this Section 6.2 and Section 6.2 of the Other Purchase Agreements.
SECTION 6.3 INSPECTION. Prior to and following the Closing, the Company
will permit each of the Purchasers and their representatives to visit and
inspect any of the Company's properties, to examine its books and records and to
make copies and to take extracts therefrom, and to discuss its business affairs
and finances with its officers and key employees, all at such reasonable times
as the Purchasers may request.
SECTION 6.4 AVAILABILITY OF COMMON STOCK. The Company shall at all
times reserve and keep available out of its authorized but unissued Common
Stock, for the purpose of effecting the conversion of the Shares, the full
number of shares of Common Stock then issuable upon the conversion of the
Shares. The Company will, from time to time, in accordance with the laws of
the State of Delaware, increase the authorized amount of Common Stock if at
any time the number of shares of Common Stock remaining unissued and
available for issuance shall be insufficient to permit conversion of the
Shares.
SECTION 6.5 TRANSACTION FEE. Upon the execution of this Agreement, the
Company shall pay the Purchasers an aggregate fee equal to $100,000. On the
Closing Date, the Company shall pay the Purchasers an additional aggregate fee
equal to $200,000.
SECTION 6.6 FLEET BANK CONSENT. The Company will use its best efforts
to obtain the consent of Fleet Bank of Massachusetts, N.A. referred to in
Section 5.12 of the Disclosure Letter, within 10 days after the date hereof.
SECTION 6.7 PROXY STATEMENTS; STOCKHOLDER APPROVALS. The Company acting
through the Board of Directors, shall, in accordance with applicable law
and its Certificate of Incorporation and By-Laws:
(a) promptly and duly call, give notice of, convene and hold as soon as
practicable following the clearance of the proxy statement to be issued in
connection with the transactions contemplated herein (the "Proxy
Statement") with the SEC, but in no event later than the Closing Date, a
meeting of its stockholders for the purpose of voting to approve the
issuance of the Shares and the shares of Common Stock issuable upon
conversion thereof and shall use its best efforts, except to the extent the
Board of Directors determines in good faith, after consultation with
outside counsel, that contrary action is required by the Board of
Directors' fiduciary duties under applicable law, to obtain stockholder
approval;
(b) except to the extent the Board of Directors determines in good
faith, after consultation with outside counsel, that contrary action is
required by the Board of Directors' fiduciary duties under applicable law,
recommend approval of the issuance of the Shares and the shares of Common
Stock issuable upon conversion thereof, and include in the Proxy Statement
such recommendation, and take all lawful action to solicit such approvals;
and
(c) as promptly as practicable following the signing of this
Agreement, prepare and file with the SEC a preliminary Proxy Statement and
respond to any comments of the SEC with respect to the preliminary Proxy
Statement and cause the definitive Proxy Statement to be mailed to its
stockholders.
SECTION 6.8 ELECTION TO BOARD OF DIRECTORS OF THE COMPANY.
Simultaneously with the Closing, the Company shall (a) take all actions
necessary to ensure that one representative of each of the following
Purchaser groups is appointed to the Board of Directors promptly after the
consummation of the transactions contemplated herein: (i) Thomas H. Lee
Equity Fund III, L.P., Thomas H. Lee Foreign Fund III, L.P., Thomas H. Lee
Company and affiliates (collectively, the "Lee Purchaser Group"); (ii) Bain
Capital Fund V, L.P., Bain Capital Fund V-B, L.P., BCIP Associates, L.P.,
BCIP Trust Associates, L.P. and affiliates (collectively, the "Bain
Purchaser Group"); and (iii) Centre Capital Investors II, L.P., Centre
Capital Tax-Exempt Investors II, L.P., Centre Capital Offshore Investors
II, L.P., State Board of Administration of Florida, Centre Parallel
Management Partners, L.P., Centre Partners Coinvestment, L.P. and
affiliates (collectively, the "Centre Purchaser Group"); (b) use best
efforts to cause each of the directors appointed in accordance with
subsection (a) hereof and the representative of the Thomas H. Lee Company
currently serving on the Board of Directors (and any successor nominees
thereof) (collectively, the "Purchasers' Representatives") to be
renominated and reelected when their initial and any subsequent term
expires, (c) use best efforts to cause the election of two nominees from
the four Purchasers' Representatives to each of the executive, compensation
and audit committees of the Board of Directors, in each case except to the
extent the Board of Directors determines in good faith, after consultation
with outside counsel, that contrary action is required by the Board of
Directors' fiduciary duties under applicable law; provided, however that if
(i) the Lee Purchaser Group, in the aggregate, holds less than 40% or 20%
of the Shares initially owned by the Lee Purchaser Group (or if any of such
Shares have been converted and after making appropriate adjustment for any
stock dividend, split-up, recapitalization, rights, merger or other change
in the corporate or capital structure of the Company (a "Restructuring"),
shares of Common Stock and shares of Common Stock issuable upon conversion
of the Shares representing less than 40% or 20% of the Common Stock
originally issuable upon conversion of the Shares), the Lee Purchaser Group
shall only be entitled to nominate one or no such nominees to the Board of
Directors, respectively; (ii) the Bain Purchaser Group holds less than 40%
of the Shares initially owned by the Bain Purchaser Group (or if any of
such Shares have been converted and after making appropriate adjustment for
any Restructuring, shares of Common Stock and shares of Common Stock
issuable upon conversion of the Shares representing less than 40% of the
Common Stock originally issuable upon conversion of the Shares), the Bain
Purchaser Group shall not be entitled to nominate any nominees to the Board
of Directors; and (iii) the Centre Purchaser Group holds less than 40% of
the Shares initially owned by the Centre Purchaser Group (or if any of such
Shares have been converted and after making appropriate adjustment for any
Restructuring, shares of Common Stock and shares of Common Stock issuable
upon conversion of the Shares representing less than 40% of the Common
Stock originally issuable upon conversion of the Shares), the Centre
Purchaser Group shall not be entitled to nominate any nominees to the Board
of Directors; and provided, further that (i) if at any time there are only
two Purchasers' Representatives serving on the Board of Directors, the
Company will use its best efforts to cause the election of only one of such
Purchasers' Representatives to each of the executive, compensation and
audit committee and (ii) if at any time there is only one Purchasers'
Representative serving on the Board of Directors, the Company is not
obligated to use its best efforts to cause the election of such Purchasers'
Representative to any of the committees. Each of the Purchasers and the
Other Purchasers will designate the representatives who will sit on the
executive, compensation and audit committees of the Board of Directors
based on a vote of a majority in interest of the Purchasers and the Other
Purchasers.
SECTION 6.9 NO GENERAL SOLICITATION. None of the Company, its
affiliates (as defined in Rule 501(b) of the Securities Act) or any person
acting on their behalf will solicit any offer to buy or offer or sell the
Shares by means of any form or general solicitation or general advertising
(as those terms are used in Regulation D under the Securities Act) or in
any manner involving a public offering within the meaning of Section 4(2)
of the Securities Act that would require the registration of the Shares
under the Securities Act.
ARTICLE VII
COVENANTS OF THE PURCHASERS
SECTION 7.1 CERTAIN RESTRICTIONS.
(a) Each of the Purchasers covenants with the Company that, without the
consent of the Company, for a period commencing, on the date hereof and
continuing through the fifth anniversary of the date hereof none of the
Purchasers, singly or as part of a group, directly or indirectly, through
one or more intermediaries or otherwise, will:
(i) purchase or acquire, or offer, propose or agree to purchase or
acquire, directly or indirectly, any of the Common Stock (other than by
conversion of any of the Shares), any option, warrant or other right to
acquire, directly or indirectly, any Common Stock or any securities
which are convertible into or exchangeable or exercisable for Common
Stock (other than the exercise of options under the Stock Option
Agreement dated the date hereof); provided, however, that
notwithstanding anything to the contrary contained herein, the
foregoing restriction shall not be deemed to be violated or applicable
if a Purchaser is not otherwise in breach of this Agreement and (A) the
amount of the outstanding Common Stock beneficially owned, in the
aggregate, by such Purchaser is increased as a result of any stock
dividend, stock split, split-up, recapitalization, merger or other
change in the corporate or capital structure of the Company or any
other action taken solely by the Company or (B) the Company breaches
its obligations under Section 6.8 hereof; and provided, further, that
at any time when the percentage of the outstanding Common Stock owned
by a Purchaser on a fully diluted basis is less than the percentage of
the outstanding Common Stock owned by such Purchaser on a fully diluted
basis on the Closing Date (the "Maximum Amount") such Purchaser may
purchase additional shares of Common Stock up to the Maximum Amount;
(ii) solicit, or encourage any other person to solicit, "proxies"
or become a "participant" or otherwise engage in any "solicitation" (as
such terms are defined or used in Regulation 14A under the Exchange
Act) in opposition to a recommendation of a majority of the directors
of the Company with respect to any matter; seek to advise or influence
any person (within the meaning of Section 13(d)(3) of the Exchange Act)
with respect to the voting of any securities of the Company; or execute
any written consent in lieu of a meeting of holders of securities of
the Company or any class thereof;
(iii) initiate, propose or otherwise solicit stockholders for the
approval of one or more stockholder proposals with respect to the
Company, as described in Rule 14a-8 under the Exchange Act;
(iv) except as results from the Purchase Agreements or from
arrangements among the Purchasers and the Other Purchasers, directly or
indirectly participate in or encourage the formation of any "group"
(within the meaning of Section 13(d)(3) of the Exchange Act) owning or
seeking to acquire beneficial ownership of securities of the Company or
affect control of the Company;
(v) except as results from the Purchase Agreements or from
arrangements among the Purchasers and the Other Purchasers, otherwise
act, directly or indirectly, alone or in concert with others, to seek
to control or influence in any manner the management, business,
operations, board of directors, policies or affairs of the Company, or
propose or seek to effect any form of business combination transaction
with the Company or any affiliate thereof or any restructuring,
recapitalization or other similar transaction with respect to the
Company; or
(vi) (a) encourage any person, firm, corporation, group or other
entity to engage in any of the actions covered by clauses (i) through
(v) of this Section 7.1 or make any public arrangement (or make other
communication with or to the Company or otherwise which, in the opinion
of counsel to the Company, would require public announcement) with
respect to any matter set forth in clause (i) through (v) of this
Section 7.1; provided, however, that actions taken by any
representative of the Purchaser on the Board of Directors of the
Company, acting in his or her capacity as such a director, shall not
violate this Section 7.1.
(b) No Purchaser shall, without the Company's consent, sell,
transfer, effect a short sale of, grant any option for the purchase of,
or loan any Shares or Common Stock for a period of 18 months from the
date of issuance of the Shares except to an affiliate or the Other
Purchasers or an affiliate thereof; provided that this restriction on
each Purchaser's ability to sell or transfer any Shares will cease to
apply upon a conversion of the Shares pursuant to Section 8.10.1 of the
Certificate of Designation; provided further, that each Purchaser may
sell its Shares or Common Stock in any tender offer or exchange offer
made for any Company securities.
ARTICLE VIII
RESTRICTIONS ON TRANSFERABILITY OF SECURITIES
SECTION 8.1 RESTRICTIVE LEGEND. Each certificate representing (a)
the Shares, (b) shares of the Common Stock issuable upon conversion of any
Shares, and (c) any other securities issued in respect of the Shares or
Common Stock issued upon conversion of any Shares upon any stock split,
stock dividend, recapitalization, merger, consolidation or similar event
(each of the foregoing securities in (a) through (c) being referred to
herein as "Restricted Securities"), shall (unless otherwise permitted by
the provisions of Section 8.2 below) be stamped or otherwise imprinted with
a legend substantially in the following form (in addition to the legend
required under any applicable state securities laws):
THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE BEEN ACQUIRED FOR
INVESTMENT AND HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933 OR ANY APPLICABLE STATE SECURITIES LAWS. SUCH SHARES MAY NOT BE
SOLD OR TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATIONS OR EXEMPTIONS
THEREFROM UNDER SAID ACT OR LAWS. COPIES OF THE AGREEMENT COVERING THE
PURCHASE OF THESE SHARES AND THEIR TRANSFER MAY BE OBTAINED AT NO
COST BY WRITTEN REQUEST MADE BY THE HOLDER OF RECORD OF THIS
CERTIFICATE TO THE SECRETARY OF THE COMPANY.
The Company will promptly, upon request, remove any such legend when no longer
required by the terms of this Agreement or by applicable law.
SECTION 8.2 NOTICE OF PROPOSED TRANSFERS. Prior to any proposed
transfer of any Restricted Securities, unless there is in effect a
registration statement under the Securities Act covering the proposed
transfer, the Purchaser proposing such a transfer shall give written notice
to the Company of its intention to effect such transfer. Each such notice
shall describe the manner and circumstances of the proposed transfer in
sufficient detail, and shall be accompanied by either (a) a written opinion
of legal counsel (who shall be reasonably satisfactory to the Company)
addressed to the Company to the effect that the proposed transfer of the
Restricted Securities may be effected without registration under the
Securities Act or (b) a "no action" letter from the Commission to the
effect that the transfer of such securities without registration will not
result in a recommendation by the staff of the Commission that action be
taken with respect thereto, whereupon, in each case, such Purchaser shall
be entitled to transfer such Restricted Securities in accordance with the
terms of the notice delivered by such Purchaser to the Company. Unless
there is in effect a registration statement under the Securities Act
covering the proposed transfer, each certificate evidencing the Restricted
Securities transferred as herein provided shall bear the appropriate
restrictive legend set forth in Section 8.1 above except that such
certificate shall not bear such restrictive legend if, (i) in the opinion
of counsel for such Purchaser, such legend is not required in order to
establish compliance with any provisions of the Securities Act, (ii) a
period of at least one year has elapsed since the later of the date the
Restricted Securities were acquired from the Company or from an affiliate
of the Company, and such Purchaser represents to the Company that it is not
an affiliate of the Company and has not been an affiliate during the
preceding three months and shall not become an affiliate of the Company
without resubmitting the Restricted Securities for reimposition of the
legend, or (iii) the restricted Securities have been sold pursuant to Rule
144(k) and the certificate is accompanied by a representation by such
Purchaser that it is not an affiliate of the Company, has not been an
affiliate during the three-month period prior to the sale and has held the
Restricted Securities for more than two years.
ARTICLE IX
TERMINATION
Notwithstanding anything contained herein to the contrary, this
Agreement may be terminated at any time prior to the Closing Date:
(a) by the mutual written consent of the Purchasers and the
Company;
(b) by any Purchaser or the Company if the Closing has not
occurred on or before six months from the date hereof and this Agreement
has not previously been terminated; provided, however, that the right to
terminate the Agreement under this Section 9(b) shall not be available to
any party whose failure to fulfill any obligation under this Agreement has
been the cause of, or resulted in, the failure of the Closing to occur on
or before such date; or
(c) by any Purchaser or the Company if any of the Other Purchase
Agreements or the Note Purchase Agreement are terminated; or
(d) by any Purchaser 10 days after the Company's shareholders, at
a duly held meeting at which such shareholders vote on the issuance of the
Preferred Stock to the Purchasers or the Other Purchasers, fail to approve
such issuance.
In the event that this Agreement shall be terminated pursuant to
this Article IX, all further obligations of the parties under this
Agreement other than the obligations set forth in Article X and Sections
6.2, 6.5 and 11.10 shall be terminated without further liability of any
party to any other party, provided that nothing herein shall relieve any
party from liability for its willful breach of this Agreement.
ARTICLE X
INDEMNIFICATION
SECTION 10.1 INDEMNIFICATION. The Company hereby agrees to
indemnify, defend and hold harmless each Purchaser from and against all de-
mands, claims, actions or causes of action, assessments, losses, damages,
liabilities, costs and expenses (collectively, "Claims"), including without
limitation, interest, penalties and attorneys' fees and expenses, asserted
against, resulting to, or imposed upon or incurred by such Purchaser
directly or indirectly, in connection with the transactions contemplated
hereby.
SECTION 10.2 TERMS OF INDEMNIFICATION. The obligations and
liabilities of the Company with respect to Claims by third parties will be
subject to the following terms and conditions:
(a) a Purchaser will give the Company prompt notice of any Claims
asserted against, resulting to, imposed upon or incurred by a Purchaser,
directly or indirectly, and the Company will undertake the defense thereof
by representatives of their own choosing which are reasonably satisfactory
to such Purchaser; provided that the failure of any Purchaser to give
notice as provided in this Section 10.2 shall not relieve the Company of
its obligations under this Article X, except to the extent that such
failure has materially and adversely affected the rights of the Company;
(b) if within a reasonable time after notice of any Claim, the
Company fails to defend, such Purchaser will have the right to undertake the
defense, compromise or settlement of such Claims on behalf of and for the
account and at the risk of the Company, subject to the right of the Company to
assume the defense of such Claim at any time prior to settlement, compromise or
final determination thereof;
(c) if there is a reasonable probability that a Claim may
materially and adversely affect a Purchaser other than as a result of money
damages or other money payments, such Purchaser will have the right at its own
expense to defend (provided that the indemnifying party shall continue to
control the defense and the indemnified party shall have the right to
participate in such defense), or co-defend, such Claim;
(d) the Company on one hand and the Purchasers on the other
will not, without the prior written consent of the other, settle or compromise
any Claim or consent to entry of any judgment relating to any such Claim;
(e) with respect to any Claims asserted against a Purchaser, such
Purchaser will have the right to employ one counsel of its choice in each
applicable jurisdiction (if more than one jurisdiction is involved) to
represent such Purchaser if, in such Purchaser's reasonable judgment, a
conflict of interest between such Purchaser and the indemnifying party
exists in respect of such Claims, and in that event the fees and expenses
of such separate counsel shall be paid by such indemnifying party;
(f) the Company will provide each Purchaser reasonable access to
all records and documents of the Company relating to any Claim; and
(g) any Claim, in so far as it is related to any of the
representations and warranties of the Company contained in this Agreement,
must be made within one year of the Closing Date.
ARTICLE XI
MISCELLANEOUS
SECTION 11.1 GOVERNING LAW. This Agreement shall be governed by
and construed in accordance with the laws of the Commonwealth of Massachusetts,
without regard to the conflict of laws rules thereof.
SECTION 11.2 SURVIVAL. All representations and warranties,
covenants and agreements of the Company and any Purchaser contained in this
Agreement shall remain operative and in full force and effect regardless of any
investigation made by or on behalf of any Purchaser or any controlling person
thereof or by or on behalf of the Company, any of its officers and directors or
any controlling person thereof, and such representations and warranties shall
survive for a period of one year from the Closing Date hereof.
SECTION 11.3 SUCCESSORS AND ASSIGNS. Except as otherwise provided
herein, the provisions hereof shall inure to the benefit of, and be binding
upon, the successors and permitted assigns of the parties hereto. No assignment
of this Agreement may be made by either party at any time, whether or not by
operation of law, without the other party's prior written consent, except that
each Purchaser may assign any of its rights hereunder to an affiliate of such
Purchaser or to the Other Purchasers or any of their affiliates without the
Company's consent provided that such affiliate expressly assumes in writing all
of the purchaser's obligations hereunder, and provided that such assignment
shall not relieve the assigning Purchaser of its obligations hereunder.
SECTION 11.4 ENTIRE AGREEMENT; AMENDMENT. This Agreement and the
Transaction Documents constitute the full and entire understanding and agreement
between the parties with regard to the subjects hereof and thereof provided that
the Confidentiality Agreement between the Purchasers and the Company dated April
18, 1997 shall remain in effect. Except as expressly provided herein, neither
this Agreement nor any term hereof may be amended, waived, discharged or
terminated other than by a written instrument signed by the party against whom
enforcement of any such amendment, waiver, discharge or termination is sought.
SECTION 11.5 NOTICES, ETC. All notices and other communications
provided for or permitted hereunder shall be made in writing by hand-delivery,
first-class mail (registered or certified, return receipt requested), telex,
telecopier or courier guaranteeing overnight delivery, addressed (a) if to the
Purchasers to Centre Partners Management LLC at 30 Rockefeller Plaza, Suite
5050, New York, New York 10020, Attention: Paul J. Zepf, or at such other
addresses as shall have been furnished to the Company with a copy to Louis A.
Goodman of Skadden, Arps, Slate, Meagher & Flom LLP at One Beacon Street,
Boston, Massachusetts 02108 and (b) if to the Company, at One Athenaeum Street,
Cambridge, Massachusetts 02142, Attention: Mr. Neal S. Winneg, or at such other
address as the Company shall have furnished to the Purchaser in writing with a
copy to Mark G. Borden at Hale and Dorr LLP, 60 State Street, Boston,
Massachusetts 02109. All such notices and communications shall be deemed to have
been duly given: at the time delivered by hand, if personally delivered; five
business days after being deposited in the mail, postage prepaid, if mailed;
when answered back, if telexed; when receipt is acknowledged, if telecopied; and
on the next business day, if timely delivered to a courier guaranteeing
overnight delivery.
SECTION 11.6 DELAYS OR OMISSIONS. Except as expressly provided
herein, no delay or omission to exercise any right, power or remedy accruing to
the Company or any of the Purchasers upon any breach or default of any party
under this Agreement, shall impair any such right, power or remedy of the
Company or any of the Purchasers nor shall it be construed to be a waiver of any
such breach or default, or an acquiescence therein, or of or in any similar
breach or default thereafter occurring; nor shall any waiver of any single
breach or default be deemed a waiver of any other breach or default theretofore
or thereafter occurring. Any waiver, permit, consent or approval of any kind or
character on the part of the Company or any of the Purchasers of any breach or
default under this Agreement, or any waiver on the part of any such party of any
provisions or conditions of this Agreement, must be in writing and shall be
effective only to the extent specifically set forth in such writing. All
remedies, either under this Agreement or by law or otherwise afforded to the
Company or any of the Purchasers, shall be cumulative and not alternative.
SECTION 11.7 COUNTERPARTS. This Agreement may be executed in any
number of counterparts, each of which may be executed by only one of the parties
hereto, each of which shall be enforceable against the party actually executing
such counterpart, and all of which together shall constitute one instrument.
SECTION 11.8 SEVERABILITY. In the event that any provision of this
Agreement becomes or is declared by a court of competent jurisdiction to be
illegal, unenforceable or void, this Agreement shall continue in full force and
effect without said provisions; provided that no such severability shall be
effective if it materially changes the economic benefit of this Agreement to any
party.
SECTION 11.9 TITLES AND SUBTITLES. The titles and subtitles used
in this Agreement are used for convenience only and are not to be considered in
construing or interpreting this Agreement.
SECTION 11.10 NO PUBLIC ANNOUNCEMENT. Neither the Company nor any
of the Purchasers shall make any press release or other public announcement
concerning the transactions contemplated by this Agreement except as and to the
extent that any such party shall be obligated to make any such disclosure by law
or by the NYSE and then only after consultation with the other regarding the
basis of such obligation and the content of such press release or other public
announcement or as the parties shall mutually agree.
SECTION 11.11 REASONABLE EFFORTS. The Company and the Purchasers
shall use all reasonable efforts to consummate the transactions contemplated by
this Agreement, the Other Purchase Agreements and the Note Purchase Agreement.
SECTION 11.12 DISTRIBUTIONS AND ADJUSTMENTS. If from July 5, 1997
through the Closing Date the Company shall have taken any action which would
entitle the holders of Preferred Stock to a distribution or adjustment in
accordance with the Certificate of Designation if the Preferred Stock were then
outstanding, then the consideration to be received by the Purchasers
hereunder shall be appropriately adjusted.
IN WITNESS WHEREOF, each of the undersigned has caused the
foregoing Agreement to be executed under seal by one of its duly authorized
officers as of the date first above written.
THE LEARNING COMPANY, INC
By /s/ R. Scott Murray
-----------------------------
Name: R. Scott Murray
Title: Executive Vice President and
Chief Financial Officer
CENTRE CAPITAL INVESTORS II, L.P.
CENTRE CAPITAL TAX-EXEMPT INVESTORS II, L.P.
CENTRE CAPITAL OFFSHORE INVESTORS II, L.P.
By: Centre Partners II, L.P.,
as General Partner
By: Centre Partners Management LLC,
as Attorney-in-fact
By /s/ Jonathan H. Kagan
-----------------------------------------
Name: Jonathan H. Kagan
Title: Managing Director
STATE BOARD OF ADMINISTRATION OF FLORIDA
By: Centre Parallel Management Partners, L.P.,
as Manager
By: Centre Partners Management LLC,
as Attorney-in-fact
By /s/ Jonathan H. Kagan
-----------------------------------------
Name: Jonathan H. Kagan
Title: Managing Director
CENTRE PARALLEL MANAGEMENT PARTNERS, L.P.
CENTRE PARTNERS COINVESTMENT, L.P.
By: Centre Partners II LLC,
as General Partner
By /s/ Jonathan H. Kagan
----------------------------------------
Name: Jonathan H. Kagan
Title: Managing Director
Amendment to Securities Purchase Agreement
Amendment dated as of September 16, 1997 to Securities
Purchase Agreement dated as of August 26, 1997 (the "Agreement")
between The Learning Company, Inc., a Delaware corporation (the
"Company") and each of the Purchasers listed on the signature page
hereto (individually, a "Purchaser" and collectively, the
"Purchasers").
For valuable consideration, receipt of which is hereby
acknowledged, the parties hereto hereby agree that Section 8.4 of the
Certificate of Designation of Series A Convertible Participating
Preferred Stock setting forth the powers, preferences, rights,
qualifications, limitations and restrictions of such series of
Preferred Stock, attached as Exhibit A to the Agreement, is hereby
amended to read in its entirety as follows:
"Section 8.4 Conversion Price. The initial conversion price
shall be the lower of (i) $10.00 or (ii) the weighted average (based
on daily trading volumes of the Common Stock on the New York Stock
Exchange) of the Closing Prices of the Common Stock for the period of
the 30 consecutive Trading Days immediately preceding the Trading Day
which is three Trading Days before the date on which the proxy
statement is sent to the Company's stockholders with respect to the
approval of the Company's stockholders with respect to the approval of
the issuance of the Series A Preferred Stock (herein called the
"Conversion Price") subject to adjustment as provided in this Section
8."
In all other respects, the Agreement shall remain in full
force and effect.
Executed as of September 16, 1997.
THE LEARNING COMPANY, INC.
By:/s/ R. Scott Murray
------------------------------------
Name: R. Scott Murray
Title: Executive Vice President and
Chief Financial Officer
PURCHASERS:
CENTRE CAPITAL INVESTORS II, L.P.
CENTRE CAPITAL TAX-EXEMPT INVESTORS II, L.P.
CENTRE CAPITAL OFFSHORE INVESTORS II, L.P.
By: Centre Partners II, L.P.,
as General Partner
By: Centre Partners Management LLC,
as Attorney-in-fact
By: /s/ Jonathan H. Kagan
------------------------------------
Managing Director
STATE BOARD OF ADMINISTRATION OF FLORIDA
By: Centre Parallel Management
Partners, L.P., as Manager
By: Centre Partners Management LLC,
as Attorney-in-fact
By: /s/ Jonathan H. Kagan
------------------------------------
Managing Director
CENTRE PARALLEL MANAGEMENT PARTNERS, L.P.
CENTRE PARTNERS COINVESTMENT, L.P.
By: Centre Partners II LLC, as General
Partner
By: /s/ Jonathan H. Kagan
------------------------------------
Managing Director
EXHIBIT C
---------------------------------------------------------------------
SECURITIES PURCHASE AGREEMENT
Between
TRIBUNE COMPANY
and
THE PURCHASERS NAMED HEREIN
Dated as of August 26, 1997
5 1/2% Senior Convertible/Exchangeable Notes due 2000
$150,000,000 Principal Amount
---------------------------------------------------------------------
TABLE OF CONTENTS
Page
ARTICLE I
SALE OF NOTES......................... 1
ARTICLE II
CLOSING............................ 1
Section 2.1 Closing Date........................ 1
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE COMPANY......... 2
Section 3.1 Due Incorporation................... 2
Section 3.2 Authority........................... 3
Section 3.3 Non-Contravention................... 3
Section 3.4 Enforceability of Agreement......... 3
Section 3.5 Title of the Notes.................. 4
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE PURCHASERS........ 4
Section 4.1 Due Organization.................... 4
Section 4.2 Authority........................... 4
Section 4.3 Non-Contravention................... 4
Section 4.4 Enforceability of Agreement......... 5
Section 4.5 Securities Act...................... 5
Section 4.6 Funds............................... 5
ARTICLE V
CONDITIONS TO THE OBLIGATIONS OF THE PARTIES.......... 6
Section 5.1 Conditions to Obligations of the
Purchasers........................... 6
Section 5.2 Condition to Obligations of Each
Party ............................... 6
Section 5.3 Conditions to Obligations of the
Company.............................. 6
ARTICLE VI
ADDITIONAL COVENANTS...................... 6
Section 6.1 Payment of Expenses................. 6
Section 6.2 Voting Agreement.................... 6
ARTICLE VII
TERMINATION.......................... 7
ARTICLE VIII
MISCELLANEOUS......................... 8
Section 8.1 Governing Law....................... 8
Section 8.2 Survival............................ 8
Section 8.3 Successors and Assigns.............. 8
Section 8.4 Entire Agreement; Amendment......... 8
Section 8.5 Notices, Etc........................ 9
Section 8.6 Delays or Omissions................. 9
Section 8.7 Counterparts........................ 10
Section 8.8 Severability........................ 10
Section 8.9 Titles and Subtitles................ 10
Section 8.10No Public Announcement.............. 10
SECURITIES PURCHASE AGREEMENT
This SECURITIES PURCHASE AGREEMENT (this "Agreement") is made
as of August 26, 1997, among Tribune Company, a Delaware corporation (the
"Company"), and each of the Purchasers listed on the signature pages
hereto (individually, a "Purchaser" and collectively, the "Purchasers").
ARTICLE I
SALE OF NOTES
Upon the terms and subject to the conditions set forth
herein, on the Closing Date (as defined below), the Company will sell to
each of the Purchasers and, in reliance on the representations and
warranties of the Company contained herein, each of the Purchasers
severally will purchase from the Company, the 5 1/2% Senior
Convertible/Exchangeable Notes due 2000 of The Learning Company, Inc.
(formerly known as Softkey International, Inc.) (the "Notes") in the
principal amounts and at the cash price set forth on Schedule A attached
hereto, plus interest on the Notes accrued from the last interest payment
date on the Notes up to and including the Closing Date (as defined below)
payable by each Purchaser in proportion to the amount of the Notes being
purchased by such Purchaser.
ARTICLE II
CLOSING
SECTION 2.1 CLOSING DATE. The closing (the "Closing") of the
purchase and sale of the Notes contemplated hereby shall take place on
such date and at such time as agreed to by the Company and the
Purchasers, simultaneously with the closing of the Securities Purchase
Agreements dated as of the date hereof (the "Purchase Agreements")
between each of the Purchasers and The Learning Company, Inc. ("TLC")
(and each such closing shall be conditioned on simulta neously closing
the other), but in no event later than three business days following the
date upon which all of the conditions to closing set forth in Article V
hereof and in the Purchase Agreements are satisfied or waived (the date
of the Closing is hereinafter referred to as the "Closing Date"). The
Closing shall be held at the offices of Skadden, Arps, Slate, Meagher &
Flom LLP, One Beacon Street, Boston, Massachusetts 02108-3194, or at such
other place as agreed to by the Company and the Purchasers.
Delivery of the Notes to be purchased by the Purchasers
pursuant to this Agreement shall be made at the Closing by the Company
delivering to each of the Purchasers, against payment of the purchase
price therefor as listed in Schedule A hereto (plus the accrued interest
described in Article I) one certificate representing the principal
amount of Notes to be purchased by each of the Purchasers as listed in
Schedule A hereto registered in the name of such Purchaser or such other
person which shall be an affiliate of such Purchaser or a nominee of such
Pur chaser or such affiliate as such Purchaser may have designated in
writing to the Company at least one business day prior to the Closing
Date or duly endorsed for transfer with all signatures thereon guaranteed
(the "Transferee"), unless at least two business days prior to the
Closing Date such Purchaser shall have requested that the Company deliver
more than one certificate representing the Notes in which event the
Company will deliver to such Purchaser certificates representing the
number of Notes so requested, registered in such name or names specified
in such request (subject to the foregoing limitation) or duly endorsed
for transfer with all signatures thereon guaranteed and in such principal
amounts as shall have been specified in the request. Payment of the
purchase price for the Notes to be purchased hereunder shall be made by
each Purchaser by wire transfer of immediately available funds.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
As an inducement to the Purchasers to enter into this
Agreement and to consummate the transactions contemplated hereby, the
Company represents and warrants to each of the Purchasers as follows:
SECTION 3.1 DUE INCORPORATION. The Company has been duly
incorporated and is validly existing and in good standing as a
corporation under the laws of Delaware, with corporate power and
corporate authority to own its properties and conduct its business as
presently conducted.
SECTION 3.2 AUTHORITY. The Company has all necessary
corporate power and corporate authority to enter into this Agreement and
to consummate the transactions contemplated hereby.
SECTION 3.3 NON-CONTRAVENTION. The execution, delivery and
performance of this Agreement by the Company and the consummation of the
transactions contemplated hereby do not and will not, (a) conflict with
or result in a breach of any of the terms and provisions of, or
constitute a default (or an event which with notice or lapse of time, or
both, would constitute a default) under, or result in the creation or
imposition of any lien, charge or encumbrance upon any property or assets
of the Company or any of its subsidiaries pursuant to any agreement,
instrument, franchise, license or permit to which the Company or any of
its subsidiaries is a party or by which any of such corporations or their
respec tive properties or assets may be bound other than such conflicts,
breaches or defaults that are not, individually or in the aggregate,
reasonably expected to materially impair the ability of the Company to
consummate the transactions contemplated by this Agreement or (b) violate
or conflict with any judgment, decree, order, statute, rule or regulation
of any court or any public, governmental or regulatory agency or body
applicable to the Company or any of its subsidiaries or any of their
respective properties or assets, other than such violations that are not,
individually or in the aggregate, reasonably expected to impair the
ability of the Company to consummate the transactions contemplated by
this Agreement. The execution, delivery and performance of this Agreement
by the Company and the consummation of the transactions contemplated
hereby do not and will not violate or conflict with any provision of the
certificate of incorporation or by-laws of the Company or any of its
subsidiaries, as currently in effect. No consent, approval,
authorization, order, registration, filing, qualification, license or
permit of or with any court or any governmental agency or body is
required to be made or obtained by the Company or any of its subsidiaries
for the execution, delivery and performance of this Agreement or the
consummation of the transactions contemplated hereby, including the sale
and delivery of the Notes to be sold and delivered by the Company
hereunder.
SECTION 3.4 ENFORCEABILITY OF AGREEMENT. This Agreement has
been duly and validly authorized, executed and delivered by the Company
and does not require any further authorization or consent of the Company,
and is a valid and binding obligation of the Company, enforceable against
the Company in accor dance with its terms.
SECTION 3.5 TITLE OF THE NOTES. The Company has, and at the
Closing Date the Company will have, good and valid title to the Notes to
be sold by the Company hereunder, free and clear of all liens,
encumbrances, equities or claims; and, upon delivery of the Notes and
payment therefor pursuant hereto, good and valid title to the Notes, free
and clear of all liens, encumbrances, equities or claims, will pass to
the Purchasers, assuming that the Purchasers are acquiring the Notes in
good faith and without notice of any "adverse claims" within the meaning
of Article 8 of the Uniform Commercial Code.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE PURCHASERS
As an inducement to the Company to enter into this Agreement
and to consummate the transactions contemplated hereby, each of the
Purchasers severally and not jointly, hereby represents and warrants to
the Company as follows:
SECTION 4.1 DUE ORGANIZATION. Purchaser has been duly
organized and is validly existing under the laws of its jurisdiction of
organization, with power and authority (corporate or similar) to own its
properties and conduct its business and has been duly qualified for the
transaction of business under the laws of each other jurisdiction in
which it owns or leases properties or conducts any business so as to
require such qualification, or is subject to no material liability or
disability by reason of the failure to be so qualified in any such
jurisdiction.
SECTION 4.2 AUTHORITY. Purchaser has all necessary power and
authority (corporate or similar) to enter into this Agreement, and to
consummate the transactions contemplated hereby.
SECTION 4.3 NON-CONTRAVENTION. The execution, delivery and
performance of this Agreement by Purchaser and the consummation of the
transac tions contemplated hereby do not and will not, (a) conflict with
or result in a breach of any of the terms and provisions of, or
constitute a default (or an event which with notice or lapse of time, or
both, would constitute a default) under, or result in the creation or
imposition of any lien, charge or encumbrance upon any property or assets
of Purchaser or any of its subsidiaries pursuant to any agreement,
instrument, franchise, license or permit to which Purchaser or any of its
subsidiaries is a party or by which any of such entities or their
respective proper ties or assets may be bound or (b) violate or conflict
with any judgment, decree, order, statute, rule or regulation of any
court or any public, governmental or regulatory agency or body applicable
to Purchaser or any of its subsidiaries or any of their respective
properties or assets. The execution, delivery and performance of this
Agreement by Purchaser and the consummation of the transactions contemplated
hereby do not and will not violate or conflict with any provision
of the organizational documents of Purchaser or any of its subsidiaries,
as currently in effect. No consent, approval, authorization, order,
registration, filing, qualifica tion, license or permit of or with any
court or any governmental agency or body applicable to Purchaser or any
of its subsidiaries or any of their respective proper ties or assets is
required for the execution, delivery and performance of this Agreement
or the consummation of the transactions contemplated hereby, including
the sale and delivery of the Notes to be sold and delivered by Purchaser
hereunder.
SECTION 4.4 ENFORCEABILITY OF AGREEMENT. This Agreement has
been duly and validly authorized, executed and delivered by Purchaser and
does not require any further authorization or consent of Purchaser, and
is a valid and binding obligation of Purchaser, enforceable against
Purchaser in accordance with its terms.
SECTION 4.5 SECURITIES ACT. Purchaser understands that the
Notes have not been registered pursuant to the provisions of the
Securities Act of 1933, as amended (the "Securities Act") and that the
Notes may only be resold if registered pursuant to the provisions of the
Securities Act or if an exemption from registration is available.
Purchaser is a sophisticated investor that understands the risks inherent
in its purchase of the Notes and can afford a complete loss of its
investment in the Notes.
SECTION 4.6 FUNDS. Purchaser has or will at Closing have
sufficient funds to pay, pursuant to Article I hereof, the purchase price
set forth opposite its name on Schedule A hereto (plus the accrued
interest described in Article I).
ARTICLE V
CONDITIONS TO THE OBLIGATIONS OF THE PARTIES
SECTION 5.1 CONDITIONS TO OBLIGATIONS OF THE PURCHASERS. The
obligations of each of the Purchasers to purchase and pay for the Notes
as provided herein shall be subject to the condition that (a) all the
representations and warran ties of the Company herein are, on the date
hereof and as of the Closing Date, true and correct and (b) that the
Company shall have performed all of its obligations hereunder. No
Purchaser shall be obligated to purchase and pay for the Notes unless
each of the other Purchasers elects to purchase and pay for the Notes.
SECTION 5.2 CONDITION TO OBLIGATIONS OF EACH PARTY. The
obligations of each of the Company and the Purchasers to consummate the
transac tions contemplated by this Agreement are subject to the condition
that no tempo rary restraining order, preliminary or permanent injunction
or other order issued by any court of competent jurisdiction prohibiting
or preventing consummation of the transactions contemplated by this
Agreement shall be in effect.
SECTION 5.3 CONDITIONS TO OBLIGATIONS OF THE COMPANY. The
obligations of the Company to sell the Notes to each of the Purchasers
shall be subject to the condition that (a) all the representations and
warranties of each of the Purchasers herein are, on the date hereof and
as of the Closing Date, true and correct and (b) that each of the
Purchasers shall have performed all of their obliga tions hereunder.
ARTICLE VI
ADDITIONAL COVENANTS
SECTION 6.1 PAYMENT OF EXPENSES. Each party hereto shall pay
its own expenses incurred in connection with this Agreement.
SECTION 6.2 VOTING AGREEMENT. (a) At any meeting of share
holders of TLC, and at any adjournment thereof, at which such
shareholders are to vote on the issuance of TLC Series A Convertible
Participating Preferred Stock to the Purchasers on terms that are
substantially identical to those contained in the Purchase Agreements
(the "Preferred Stock Issuance"), the Company will, in person or by
proxy, vote or cause to be voted in favor of the Preferred Stock Issuance
all shares of TLC Common Stock then owned of record or beneficially
by the Company (the "Company Common Stock").
(b) Until the earlier of the date on which the shareholders
of TLC vote upon the Preferred Stock Issuance and the date on which this
Agreement is terminated in accordance with Article VII hereof, the
Company will not (i) grant to any person (other than the proxies named on
the proxy card distributed by TLC in connection with the Preferred Stock
Issuance) a proxy to vote the Company Common Stock or (ii) enter into a
voting trust or similar agreement or arrangement with respect to the
Company Common Stock. Nothing in this Section 6.2 shall restrict the
ability of the Company to sell, transfer, or otherwise dispose of any
shares of Company Common Stock at any time prior to or following the
Closing Date.
ARTICLE VII
TERMINATION
Notwithstanding anything contained herein to the contrary,
this Agreement may be terminated at any time prior to the Closing Date:
(a) By the mutual written consent of the Purchasers and the
Company;
(b) By any Purchaser or the Company if the Closing has not
occurred six months from the date hereof and this Agreement has not
previously been terminated; provided, however, that the right to
terminate the Agreement under this Section 8(b) shall not be available to
any party whose failure to fulfill any obligation under this Agreement
has been the cause of, or resulted in, the failure of the Closing to
occur on or before such date;
(c) By any Purchaser or the Company if any of the Purchase
Agreements are terminated;
(d) By any Purchaser or the Company if the shareholders of
TLC fail to approve the Preferred Stock Issuance; and
(e) By the Company within 10 days after notice that the
Purchase Agreements have been amended in a manner materially adverse to the
Company.
In the event that this Agreement shall be terminated pursuant
to this Article VIII, all further obligations of the parties under this
Agreement shall be terminated without further liability of any party to
any other party, provided that nothing herein shall relieve any party
from liability for its willful breach of this Agreement.
ARTICLE VIII
MISCELLANEOUS
SECTION 8.1 GOVERNING LAW. This Agreement shall be governed
by and construed in accordance with the laws of the State of Delaware
without regard to the conflict of rules thereof.
SECTION 8.2 SURVIVAL. All representations and warranties,
covenants and agreements contained in this Agreement shall remain
operative and in full force and effect regardless of any investigation
made by or on behalf of any Purchaser or any controlling person thereof
or by or on behalf of the Company, any of its officers and directors or
any controlling person thereof, and shall survive delivery of and payment
for the Notes to and by the Purchasers.
SECTION 8.3 SUCCESSORS AND ASSIGNS. Except as otherwise
provided herein, the provisions hereof shall inure to the benefit of, and
be binding upon, the successors and permitted assigns of the parties
hereto. No assignment of this Agreement may be made by either party at
any time, whether or not by operation of law, without the other party's
prior written consent, except that each Purchaser may assign any of its
rights hereunder to an affiliate of such Purchaser, or to another
Purchaser or any of such other Purchaser's affiliates, without the
Company's consent provided that such affiliate expressly assumes in
writing all of such Purchaser's obligations hereunder and provided that
no such assignment shall relieve the assigning Purchaser of its
obligations hereunder.
SECTION 8.4 ENTIRE AGREEMENT; AMENDMENT. This Agreement
constitutes the full and entire understanding and agreement between the
parties with regard to the subjects hereof. The parties agree that the
representations and warranties contained herein are only representations
and warranties among the parties. Except as expressly provided herein,
neither this Agreement nor any term hereof may be amended, waived,
discharged or terminated other than by a written instrument signed by the
party against whom enforcement of any such amendment, waiver, discharge
or termination is sought.
SECTION 8.5 NOTICES, ETC. All notices and other
communications provided for or permitted hereunder shall be made in
writing by hand-delivery, first-class mail (registered or certified,
return receipt requested), telex, telecopier or courier guaranteeing
overnight delivery, addressed (a) if to the Company, at 435 North
Michigan Avenue, Chicago, Illinois 60611, Attention: Senior Vice
President-Development and Attention: General Counsel, (b) if to
affiliates of Thomas H. Lee Company, at 75 State Street, Boston,
Massachusetts 02109, Attention: Anthony J. DiNovi, or at such other
address as shall have been furnished to the Company, (c) if to affiliates
of Bain Capital Inc., at Two Copley Place, Boston, Massachusetts 02116,
Attention: Mark Nunnelly, or at such other address as shall have been
furnished to the Company and (d) if to affiliates of Centre Partners
Management LLC, at 30 Rockefeller Plaza, Suite 5050, New York, New York
10020, Attention: Paul J. Zepf or at such other addresses as shall have
been furnished to the Company with a copy to Louis A. Goodman of Skadden,
Arps, Slate, Meagher & Flom LLP at One Beacon Street, Boston,
Massachusetts 02108. All such notices and communications shall be deemed
to have been duly given: at the time delivered by hand, if personally
delivered; five business days after being deposited in the mail, postage
prepaid, if mailed; when answered back, if telexed; when receipt is
acknowledged, if telecopied; and on the next business day, if timely
delivered to a courier guaranteeing overnight delivery.
SECTION 8.6 DELAYS OR OMISSIONS. Except as expressly provided
herein, no delay or omission to exercise any right, power or remedy
accruing to the Company or any Purchaser upon any breach or default of
any party under this Agreement, shall impair any such right, power or
remedy of the Company or any Purchaser nor shall it be construed to be a
waiver of any such breach or default, or an acquiescence therein, or of
or in any similar breach or default thereafter occurring; nor shall any
waiver of any single breach or default be deemed a waiver of any other
breach or default theretofore or thereafter occurring. Any waiver,
permit, consent or approval of any kind or character on the part of the
Company or any Purchaser of any breach or default under this Agreement,
or any waiver on the part of any such party of any provisions or
conditions of this Agreement, must be in writing and shall be effective
only to the extent specifically set forth in such writing. All remedies,
either under this Agreement or by law or otherwise afforded to the
Company or the Purchaser, shall be cumulative and not alternative.
SECTION 8.7 COUNTERPARTS. This Agreement may be executed in
any number of counterparts, each of which may be executed by only one of
the parties hereto, each of which shall be enforceable against the party
actually executing such counterpart, and all of which together shall
constitute one instrument.
SECTION 8.8 SEVERABILITY. In the event that any provision of
this Agreement becomes or is declared by a court of competent
jurisdiction to be illegal, unenforceable or void, this Agreement shall
continue in full force and effect without said provisions; provided that
no such severability shall be effective if it materially changes the
economic benefit of this Agreement to any party.
SECTION 8.9 TITLES AND SUBTITLES. The titles and subtitles
used in this Agreement are used for convenience only and are not to be
considered in construing or interpreting this Agreement.
SECTION 8.10 NO PUBLIC ANNOUNCEMENT. Neither the Company nor
any Purchaser shall make any press release or other public announcement
concerning the purchase and sale of the Notes contemplated by this
Agreement except (i) as and to the extent that any such party shall be
obligated to make any such disclosure by law or the requirements of any
applicable national securities exchange and then only after consultation
with the other regarding the basis of such obligation and the content of
such press release or other public announcement, or (ii) as the Company
and the Purchasers shall mutually agree.
IN WITNESS WHEREOF, each of the undersigned has caused the
foregoing Agreement to be executed by one of its duly authorized officers
as of the date first above written.
TRIBUNE COMPANY
By: /s/ Donald C. Grenesko
----------------------------
Name: Donald C. Grenesko
Title: Senior Vice President
PURCHASERS:
THOMAS H. LEE EQUITY FUND III, L.P.
By: THL Equity Advisors III Limited
Partnership, as General Partner
By: THL Equity Trust III,
as General Partner
By: /s/ Anthony J. DiNovi
___________________________
Name: Anthony J. DiNovi
Title: Vice President
THOMAS H. LEE FOREIGN FUND III, L.P.
By: THL Equity Advisors III Limited
Partnership, as General Partner
By: THL Equity Trust III,
as General Partner
By: /s/ Anthony J. DiNovi
___________________________
Name: Anthony J. DiNovi
Title: Vice President
THOMAS H. LEE COMPANY
By: /s/ Anthony J. DiNovi
____________________________
Name: Anthony J. DiNovi
Title: Managing Director
BAIN CAPITAL FUND V, L.P.
By: Bain Capital Partners V, L.P.,
as General Partner
By: Bain Capital Investors V, Inc.,
as General Partner
By: /s/ Mark E. Nunnelly
____________________________
Name: Mark E. Nunnelly
Title: Managing Director
BAIN CAPITAL FUND V-B, L.P.
By: Bain Capital Partners V, L.P.,
as General Partner
By: Bain Capital Investors V, Inc.,
as General Partner
By: /s/ Mark E. Nunnelly
______________________________
Name: Mark E. Nunnelly
Title: Managing Director
BCIP ASSOCIATES, L.P.
By: /s/ Mark E. Nunnelly
___________________________
Name: Mark E. Nunnelly
Title: General Partner
BCIP TRUST ASSOCIATES, L.P.
By: /s/ Mark E. Nunnelly
__________________________
Name: Mark E. Nunnelly
Title: Managing Director
CENTRE CAPITAL INVESTORS II, L.P.
CENTRE CAPITAL TAX-EXEMPT INVESTORS II, L.P.
CENTRE CAPITAL OFFSHORE INVESTORS II, L.P.
By: Centre Partners II, L.P.,
as General Partner
By: Centre Partners Management LLC,
as Attorney-in-fact
By: /s/ Jonathan H. Kagan
___________________________
Managing Director
STATE BOARD OF ADMINISTRATION OF FLORIDA
By: Centre Parallel Management Partners,
L.P.,
as Manager
By: Centre Partners Management LLC,
as Attorney-in-fact
By: /s/ Jonathan H. Kagan
______________________________
Managing Director
CENTRE PARALLEL MANAGEMENT PARTNERS, L.P.
CENTRE PARTNERS COINVESTMENT, L.P.
By: Centre Partners II LLC,
as General Partner
By: /s/ Jonathan H. Kagan
___________________________
Managing Director
SCHEDULE A
<TABLE>
<CAPTION>
Principal Amount of Purchase
Name of Purchaser Notes to be Purchased Price
----------------- --------------------- --------
<S> <C> <C>
Thomas H. Lee Company Entities $91,463,400 $75,000,000
THOMAS H. LEE EQUITY FUND III, L.P.
THOMAS H. LEE FOREIGN FUND III, L.P.
THOMAS H. LEE COMPANY
BAIN CAPITAL, INC. ENTITIES $34,146,400 $28,000,000
BAIN CAPITAL FUND V, L.P.
BAIN CAPITAL FUND V-B, L.P.
BCIP ASSOCIATES, L.P.
BCIP TRUST ASSOCIATES, L.P.
CENTRE PARTNERS MANAGEMENT LLC ENTITIES $24,390,200 $20,000,000
CENTRE CAPITAL INVESTORS II, L.P.
CENTRE CAPITAL TAX-EXEMPT INVESTORS II,
L.P.
CENTRE CAPITAL OFFSHORE INVESTORS II, L.P.
STATE BOARD OF ADMINISTRATION OF FLORIDA
CENTRE PARALLEL MANAGEMENT PARTNERS, L.P.
CENTRE PARTNERS COINVESTMENT, L.P.
-------------------------- ------------
TOTAL $150,000,000 $123,000.000
</TABLE>
Exhibit D
REGISTRATION RIGHTS AGREEMENT
by and among
THE LEARNING COMPANY, INC.
and
THE PURCHASERS NAMED HEREIN
Dated as of August 26, 1997
TABLE OF CONTENTS
Section Page
1. Introduction................................................... 1
2. Registration under Securities Act, etc......................... 1
2.1 Registration on Request....................................... 1
(a) Request................................................. 1
(b) Registration Statement Form............................. 2
(c) Expenses................................................ 2
(d) Effective Registration Statement........................ 2
(e) Selection of Underwriters............................... 3
(f) Priority in Requested Registrations..................... 3
(g) Limitation on Registration on Request................... 3
2.2 Incidental Registration....................................... 4
(a) Right to Include Registrable Securities................. 4
(b) Priority in Incidental Registrations.................... 5
2.3 Registration Procedures....................................... 5
2.4 Underwritten Offerings........................................ 11
(a) Requested Underwritten Offerings........................ 11
(b) Incidental Underwritten Offerings....................... 12
(c) Holdback Agreements..................................... 12
(d) Participation in Underwritten Offerings................. 13
2.5 Preparation; Reasonable Investigation......................... 13
2.6 Indemnification............................................... 14
(a) Indemnification by the Company.......................... 14
(b) Indemnification by the Sellers.......................... 15
(c) Notices of Claims, etc.................................. 15
(d) Other Indemnification................................... 16
(e) Indemnification Payments................................ 16
(f) Contribution............................................ 16
2.7 Adjustments Affecting Registrable Securities.................. 18
3. Definitions.................................................... 18
4. Rule 144....................................................... 21
5. Amendments and Waivers......................................... 21
6. Nominees for Beneficial Owners................................. 21
7. Notices........................................................ 22
8. Assignment..................................................... 22
9. Descriptive Headings.......................................... 23
10. GOVERNING LAW................................................. 23
11. Counterparts.................................................. 23
12. Entire Agreement.............................................. 23
14. Severability.................................................. 23
REGISTRATION RIGHTS AGREEMENT
REGISTRATION RIGHTS AGREEMENT, dated as of August 26, 1997, among THE
LEARNING COMPANY, a Delaware corporation (the "Company"), and each of the
other parties listed on the signature pages hereto (each a "Purchaser" and,
collectively, the "Purchasers").
1. Introduction. The Company is a party to three separate Securities
Purchase Agreements (the "Purchase Agreements"), each dated as of August
26, 1997, with the Purchasers pursuant to which the Purchasers have agreed
to purchase from the Company an aggregate of 750,000 shares of Series A
Convertible Participating Preferred Stock, par value $.01 per share, of the
Company (the "Convertible Preferred Stock"). Certain capitalized terms used
in this Agreement are defined in Section 3 hereof.
2. Registration under Securities Act, etc.
2.1 Registration on Request.
(a) Request. At any time or from time to time after the Applicable
Period, upon the written request of one or more holders (the "Initiating
Holders") of Registrable Securities holding (a) in the case of the first
and second registrations effected pursuant to this Section 2.1 and during
the five-year period commencing on the date hereof, a majority of the
Registrable Securities then outstanding on an as-converted basis, and (b)
in the case of the third and fourth registrations effected pursuant to this
Section 2.1, or the first and second registrations if such registrations
are not effected within five years hereof, at least 15% of the Registrable
Securities then outstanding on an as-converted basis, requesting that the
Company effect the registration under the Securities Act of all or part of
such Initiating Holders' Registrable Securities and specifying the intended
method of disposition thereof, the Company will promptly give written
notice of such requested registration to all registered holders of
Registrable Securities, and thereupon the Company will, subject to the
terms of this Agreement, use its best efforts to effect the registration
under the Securities Act of:
(i) the Registrable Securities which the Company has been so
requested to register by such Initiating Holders for disposition
in accordance with the intended method of disposition stated in such
request; and
(ii) all other Registrable Securities the holders of which
shall have made a written request to the Company for registration
thereof within 30 days after the giving of such written notice by the
Company (which request shall specify the intended method of disposition
of such Registrable Securities);
all to the extent requisite to permit the disposition (in accordance with the
intended methods thereof as aforesaid) of the Registrable Securities so to be
registered.
(b) Registration Statement Form. Registrations under this Section
2.1 shall be on such appropriate registration form of the Commission (i) as
shall be selected by the Company and (ii) as shall permit the disposition
of such Registrable Securities in accordance with the intended method or
methods of disposition specified in their request for such registration.
If, in connection with any registration under this Section 2.1 which is
proposed by the Company to be on Form S-3 or any similar short form
registration statement which is a successor to Form S-3, the managing
underwriters, if any, shall advise the Company in writing that in their
opinion the use of another permitted form is of material importance to the
success of the offering, then such registration shall be on such other
permitted form.
(c) Expenses. The Company will pay all Registration Expenses in
connection with any registration requested pursuant to this Section 2.1.
(d) Effective Registration Statement. A registration requested
pursuant to this Section 2.1 shall not be deemed to have been effected (i)
unless a registration statement with respect thereto has become effective,
and remained effective in compliance with the provisions of the Securities
Act with respect to the disposition of all Registrable Securities covered
by such registration statement until such time as all of such Registrable
Securities have been disposed of in accordance with the intended methods of
disposition by the seller or sellers thereof set forth in such registration
statement, provided, that except with respect to any registration statement
on Form S-3 filed pursuant to Rule 415 under the Securities Act, such
period need not exceed 180 days, and provided, further, that a registration
requested pursuant to this Section 2.1 shall be deemed to have been
effected if a registration statement with respect thereto is withdrawn at
the request of the Initiating Holders for any reason other than a material
adverse development involving the Company, (ii) if, after it has become
effective, such registration becomes subject to any stop order, injunction
or other order or requirement of the Commission or other governmental
agency or court for any reason or (iii) the conditions to closing specified
in the purchase agreement or underwriting agreement entered into in
connection with such registration are not satisfied, other than by reason
of some act or omission by such Initiating Holders.
(e) Selection of Underwriters. If a requested registration
pursuant to this Section 2.1 involves an underwritten offering, the
managing or lead underwriter or underwriters thereof shall be selected by
the holders of at least a majority (by number of shares) of the Registrable
Securities as to which registration has been requested and shall be
acceptable to the Company, which shall not unreasonably withhold its
acceptance of any such underwriters.
(f) Priority in Requested Registrations. If a requested
registration pursuant to this Section 2.1 involves an underwritten
offering, and the managing underwriter shall advise the Company in writing
(with a copy to each holder of Registrable Securities requesting
registration) that, in its opinion, the number of securities requested to
be included in such registration exceeds the number which can be sold in
such offering within a price range acceptable to the holders of a majority
of the Registrable Securities requested to be included in such
registration, the Company will include in such registration, to the extent
of the number which the Company is so advised can be sold in such offering,
Registrable Securities requested to be included in such registration by the
holder or holders of Registrable Securities, pro rata among such holders
requesting such registration on the basis of the number of such securities
requested to be included by such holders.
(g) Limitation on Registration on Request. Subject to Sections
1(d) and 1(f), in no event will the Company be required to effect, in the
aggregate, more than four registrations pursuant to this Section 2.1
provided, however, that the Company will be required to effect only one
registration of Option Shares and Related Registrable Securities. If, while
a registration request is pending pursuant to this Section 2.1, the Board
of Directors of the Company makes a good faith determination that the
filing of the requested registration would adversely affect either (i) a
pending transaction of the Company or (ii) a securities offering which the
Company plans to undertake, the Company shall not be required to effect a
registration pursuant to this Section 2.1 until the consummation of such
transaction or registration; provided, however, that the Company may only
assert either of such delays once during any 12-month period, and any such
asserted delay with respect to the Company's obligation to effect a
registration pursuant to this Section 2.1 shall in no event exceed 90 days.
2.2 Incidental Registration.
(a) Right to Include Registrable Securities. If the Company at any
time proposes to register, after the Applicable Period, any of its
securities under the Securities Act (other than by a registration on Form
S-4 or S-8, or any successor or similar forms, and other than pursuant to
Section 2.1), whether or not for sale for its own account, it will each
such time give prompt written notice to all holders of Registrable
Securities of its intention to do so and of such holders' rights under this
Section 2.2. Upon the written request of any such holder (a "Requesting
Holder") made within 30 days after the receipt of any such notice (which
request shall specify the Registrable Securities intended to be disposed of
by such holder and the intended method of disposition thereof), the Company
will, subject to the terms of this Agreement, use its best efforts to
effect the registration under the Securities Act of all Registrable
Securities which the Company has been so requested to register by the
holders thereof, to the extent requisite to permit the disposition (in
accordance with the intended methods thereof as aforesaid) of the
Registrable Securities so to be registered, by inclusion of such
Registrable Securities in the registration statement which covers the
securities which the Company proposes to register, provided that if, at any
time after giving written notice of its intention to register any
securities and prior to the effective date of the registration statement
filed in connection with such registration, the Company shall determine for
any reason either not to register or to delay registration of such
securities, the Company may, at its election, give written notice of such
determination to each holder of Registrable Securities and, thereupon, (i)
in the case of a determination not to register, shall be relieved of its
obligation to register any Registrable Securities in connection with such
registration (but not from its obligation to pay the Registration Expenses
in connection therewith), without prejudice, however, to the rights of any
holder or holders of Registrable Securities entitled to do so to request
that such registration be effected as a registration under Section 2.1, and
(ii) in the case of a determination to delay registering, shall be
permitted to delay registering any Registrable Securities, for the same
period as the delay in registering such other securities. No registration
effected under this Section 2.2 shall relieve the Company of its obligation
to effect any registration upon request under Section 2.1, nor shall any
such registration hereunder be deemed to have been effected pursuant to
Section 2.1. The Company will pay all Registration Expenses in connection
with each registration of Registrable Securities requested pursuant to this
Section 2.2.
(b) Priority in Incidental Registrations. If (i) a registration
pursuant to this Section 2.2 involves an underwritten offering of the
securities so being registered, whether or not for sale for the account of
the Company, to be distributed (on a firm commitment basis) by or through
one or more underwriters of recognized standing under underwriting terms
appropriate for such a transaction, (ii) the Registrable Securities so
requested to be registered for sale for the account of holders of
Registrable Securities are not also to be included in such underwritten
offering (either because the Company has not been requested so to include
such Registrable Securities pursuant to Section 2.4(b) or, if requested to
do so, is not obligated to do so under Section 2.4(b), and (iii) the
managing underwriter of such underwritten offering shall inform the Company
and holders of the Registrable Securities requesting such registration by
letter of its belief that the distribution of all or a specified number of
such Registrable Securities concurrently with the securities being
distributed by such underwriters would interfere with the successful
marketing of the securities being distributed by such underwriters (such
writing to state the approximate number of such Registrable Securities
which may be distributed without such effect), then the Company may, upon
written notice to all holders of such Registrable Securities, reduce pro
rata (if and to the extent stated by such managing underwriter to be
necessary to eliminate such effect) the number of such Registrable
Securities the registration of which shall have been requested by each
holder of Registrable Securities so that the resultant aggregate number of
such Registrable Securities so included in such registration shall be equal
to the number of shares stated in such managing underwriter's letter.
2.3 Registration Procedures. If and whenever the Company is required to
use its best efforts to effect the registration of any Registrable
Securities under the Securities Act as provided in Sections 2.1 and 2.2 the
Company shall, as expeditiously as possible:
(i) prepare and as soon as reasonably practicable file with
the Commission the requisite registration statement to effect such
registration (including such audited financial statements as may be
required by the Securities Act or the rules and regulations promulgated
thereunder) and thereafter use its reasonable efforts to cause such
registration statement to become and remain effective, provided however
that the Company may discontinue any registration of its securities
which are not Registrable Securities (and, under the circumstances
specified in Section 2.2(a), its securities which are Registrable
Securities) at any time prior to the effective date of the registration
statement relating thereto, provided further that before filing such
registration statement or any amendments thereto, the Company will
furnish to the counsel selected by the holders of Registrable
Securities which are to be included in such registration copies of all
such documents proposed to be filed, which documents will be subject to
the review of such counsel;
(ii) prepare and file with the Commission such amendments
and supplements to such registration statement and the prospectus used
in connection therewith as may be necessary to keep such registration
statement effective and to comply with the provisions of the Securities
Act with respect to the disposition of all securities covered by such
registration statement until such time as all of such securities have
been disposed of in accordance with the intended methods of disposition
by the seller or sellers thereof set forth in such registration
statement; provided, that except with respect to any such registration
statement on Form S-3 filed pursuant to Rule 415 under the Securities
Act, such period need not exceed 180 days;
(iii) furnish to each seller of Registrable Securities
covered by such registration statement and each underwriter, if any, of
the securities being sold by such seller such number of conformed
copies of such registration statement and of each such amendment and
supplement thereto (in each case including all exhibits), such number
of copies of the prospectus contained in such registration statement
(including each preliminary prospectus and any summary prospectus) 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, as such seller and underwriter, if any, may reasonably
request;
(iv) use its best efforts to register or qualify all
Registrable Securities and other securities covered by such
registration statement under such other securities laws or blue sky
laws of such jurisdictions as any seller thereof and any underwriter of
the securities being sold by such seller shall reasonably request, to
keep such registrations or qualifications in effect for so long as such
registration statement remains in effect, and to take any other action
which may be reasonably necessary or advisable to enable such seller
and underwriter to consummate the disposition in such jurisdictions of
the securities owned by such seller, 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 wherein it would not but for
the requirements of this subdivision (iv) be obligated to be so
qualified or to consent to general service of process in any such
jurisdiction;
(v) use its best efforts to cause all Registrable
Securities covered by such registration statement to be registered with
or approved by such other governmental agencies or authorities as may
be necessary in the opinion of counsel to the Company and counsel to
the seller or sellers of Registrable Securities to enable the seller or
sellers thereof to consummate the disposition of such Registrable
Securities;
(vi) notify each seller of Registrable Securities and the
managing underwriter or underwriters, if any, promptly and confirm such
advice in writing promptly thereafter:
(v) when the registration statement, the prospectus or
any prospectus supplement related thereto or post-effective
amendment to the registration statement has been filed, and, with
respect to the registration statement or any post-effective
amendment thereto, when the same has become effective;
(w) of any request by the Commission for amendments or
supplements to the registration statement or the prospectus or for
additional information;
(x) of the issuance by the Commission of any stop order
suspending the effectiveness of the registration statement or
the initiation of any proceedings by any Person for that purpose;
(y) if at any time the representations and warranties
of the Company made as contemplated by Section 2.4 below cease to
be true and correct; and
(z) of the receipt by the Company of any notification
with respect to the suspension of the qualification of any
Registrable Securities for sale under the securities or blue sky
laws of any jurisdiction or the initiation or threat of any
proceeding for such purpose.
(vii) notify each seller of Registrable Securities covered
by such registration statement, at any time when a prospectus relating
thereto is required to be delivered under the Securities Act, upon
discovery that, or upon the happening of any event as a result of
which, the prospectus included in 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 not misleading in the light of the
circumstances then existing, and at the request of any such seller
promptly prepare and furnish to such seller and each underwriter, if
any, 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 not misleading in the light of the circumstances then existing;
(viii) use its best efforts to obtain the withdrawal of any
order suspending the effectiveness of the registration statement at the
earliest possible moment;
(ix) otherwise use its best efforts to comply with all
applicable rules and regulations of the Commission, and make available
to its security holders, as soon as reasonably practicable, an earnings
statement covering the period of at least twelve months, but not more
than eighteen months, beginning with the first day of the Company's
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 thereunder, and will
furnish to each such seller at least five business days prior to the
filing thereof a copy of any amendment or supplement to such
registration statement or prospectus and shall not file any thereof to
which any such seller shall have reasonably objected on the grounds
that such amendment or supplement does not comply in all material
respects with the requirements of the Securities Act or of the rules or
regulations thereunder;
(x) make available for inspection by a representative
or representatives of the holders of Registrable Securities, any
underwriter participating in any disposition pursuant to the
registration statement and any attorney or accountant retained by such
selling holders or underwriter (each, an "Inspector"), all financial
and other records, pertinent corporate documents and properties of the
Company (the "Records"), and cause the Company's officers, directors
and employees to supply all information reasonably requested by any
such Inspector in connection with such registration in order to permit
a reasonable investigation within the meaning of Section 11 of the
Securities Act;
(xi) provide and cause to be maintained a transfer agent
and registrar for all Registrable Securities covered by such
registration statement from and after a date not later than the
effective date of such registration statement;
(xii) enter into such agreements and take such other
actions as sellers of such Registrable Securities holding a majority of
the shares so to be sold shall reasonably request in order to expedite
or facilitate the disposition of such Registrable Securities;
(xiii) use its best efforts to list all Registrable Secu-
rities covered by such registration statement on any securities
exchange on which any of the securities of the same class as the
Registrable Securities are then listed and, if no such Registrable
Securities are so listed, on any national securities exchange on which
the Common Stock is then listed; and
(xiv) use its best efforts to provide a CUSIP number for the
Registrable Securities, not later than the effective date of the
registration statement.
The Company may require each seller of Registrable Securities as
to which any registration is being effected to furnish the Company such
information regarding such seller and the distribution of such securities
as the Company may from time to time reasonably request in writing.
The Company will not file any registration statement or amendment
thereto or any prospectus or any supplement thereto (including such
documents incorporated by reference and proposed to be filed after the
initial filing of the registration statement) to which the holders of a
majority of the Registrable Securities covered by such registration
statement or the underwriter or underwriters, if any, shall reasonably
object, provided that the Company may file such document in a form required
by law or upon the advice of its counsel.
Each holder of Registrable Securities agrees by acquisition of
such Registrable Securities that, upon receipt of any notice from the
Company of the occurrence of any event of the kind described in Section
2.3(viii), such holder will forthwith discontinue such holder's disposition
of Registrable Securities pursuant to the registration statement relating
to such Registrable Securities until such holder's receipt of the copies of
the supplemented or amended prospectus contemplated by Section 2.3(viii)
and, if so directed by the Company, will deliver to the Company (at the
Company's expense) all copies, other than permanent file copies, then in
such holder's possession of the prospectus relating to such Registrable
Securities current at the time of receipt of such notice. In the event the
Company shall give any such notice, the period mentioned in Section 2.1(d)
and Section 2.3(ii) shall be extended by the length of the period from and
including the date when each seller of any Registrable Securities covered
by such registration statement shall have received such notice to the date
on which each such seller has received the copies of the supplemented or
amended prospectus contemplated by Section 2.3(viii).
If any such registration statement refers to any holder of
Registrable Securities by name or otherwise as the holder of any securities
of the Company, then such holder shall have the right to require (i) the
insertion therein of language, in form and substance satisfactory to such
holder, to the effect that the holding by such holder of such securities is
not to be construed as a recommendation by such holder of the investment
quality of the Company's securities covered thereby and that such holding
does not imply that such holder will assist in meeting any future financial
requirements of the Company, or (ii) in the event that such reference to
such holder by name or otherwise is not required by the Securities Act or
any similar federal statute then in force, the deletion of the reference to
such holder.
2.4 Underwritten Offerings.
(a) Requested Underwritten Offerings. If requested by the
underwriters for any underwritten offering by holders of Registrable
Securities pursuant to a registration requested under Section 2.1, the
Company will enter into an underwriting agreement with such underwriters
for such offering, such agreement to be satisfactory in substance and form
to the Company, each such holder and the underwriters, and to contain such
representations and warranties by the Company and such other terms as are
generally prevailing in agreements of this type, including, without
limitation, indemnities to the effect and to the extent provided in Section
2.6. The holders of the Registrable Securities will cooperate with the
Company in the negotiation of the underwriting agreement and will give
consideration to the reasonable suggestions of the Company regarding the
form thereof, provided that nothing herein contained shall diminish the
foregoing obligations of the Company. The holders of Registrable Securities
to be distributed by such underwriters shall be parties to such
underwriting agreement and may, at their option, require that any or all of
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 such holders of Registrable Securities and
that any or all of the conditions precedent to the obligations of such
underwriters under such underwriting agreement be conditions precedent to
the obligations of such holders of Registrable Securities. Any such holder
of Registrable Securities shall not be required to make any representations
or warranties to or agreements with the Company or the underwriters other
than representations, warranties or agreements regarding such holder, such
holder's Registrable Securities and such holder's intended method of
distribution and any other representation required by law.
(b) Incidental Underwritten Offerings. If the Company at any time
proposes to register any of its securities under the Securities Act as
contemplated by Section 2.2 and such securities are to be distributed by or
through one or more underwriters, the Company will, if requested by any
Requesting Holder of Registrable Securities as provided in Section 2.2 and
subject to the provisions of Section 2.2(b), use its reasonable efforts to
arrange for such underwriters to include all the Registrable Securities to
be offered and sold by such holder among the securities to be distributed
by such underwriters, provided that if the managing underwriter of such
underwritten offering shall inform the holders of the Registrable
Securities requesting such registration by letter of its belief that
inclusion in such underwritten distribution of all or a specified number of
such Registrable Securities would interfere with the successful marketing
of the securities (other than such Registrable Securities) by the
underwriters (such writing to state the basis of such belief and the
approximate number of such Registrable Securities which may be included in
such underwritten offering without such effect), then the Company may, upon
written notice to all holders of such Registrable Securities, exclude pro
rata from such underwritten offering (if and to the extent stated by such
managing underwriter to be necessary to eliminate such effect) the number
of such Registrable Securities so that the resultant aggregate number of
such Registrable Securities shall be equal to the approximate number of
shares stated in such managing underwriter's letter. The holders of
Registrable Securities to be distributed by such underwriters shall be
parties to the underwriting agreement between the Company and such
underwriters and may, at their option, require that any or all of 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 such holders of Registrable Securities and that
any or all of the conditions precedent to the obligations of such
underwriters under such underwriting agreement be conditions precedent to
the obligations of such holders of Registrable Securities.
(c) Holdback Agreements.
(i) Each holder of Registrable Securities agrees by
acquisition of such Registrable Securities, if so required by the
managing underwriter, not to sell, make any short sale of, loan, grant
any option for the purchase of, effect any public sale or distribution
of or otherwise dispose of any equity securities of the Company, during
the 90 days after any underwritten registration pursuant to Section 2.1
or 2.2 has become effective, except as part of such underwritten
registration, whether or not such holder participates in such
registration. Notwithstanding the foregoing sentence, each holder of
Registrable Securities subject to the foregoing sentence shall be
entitled to sell during the foregoing period securities in a private
sale as long as the purchaser agrees to be bound by the provisions of
this Section 2.4(c)(i) for the balance of such 90 day period.
(ii) The Company agrees if so requested by the managing
underwriter not to sell, make any short sale of, loan, grant any option
for the purchase of, effect any public sale or distribution of or
otherwise dispose of its equity securities or securities convertible
into or exchangeable or exercisable for any of such securities during
the seven days prior to and the 90 days after any underwritten
registration pursuant to Section 2.1 or 2.2 has become effective,
except as part of such underwitten registration and except in
connection with a stock option plan, stock purchase plan, managing
directors' plan, or savings or similar plan, or an acquisition of a
business, merger or exchange of stock for stock or any private
placement of stock in which the purchaser agrees to be bound by the
provisions of this Section 2.4(c)(ii) for the balance of such 90 day
period.
(d) Participation in Underwritten Offerings. No Person may
participate in any underwritten offering hereunder unless such Person (i)
agrees to sell such Person's securities on the basis provided in any
underwriting arrangements approved, subject to the terms and conditions
hereof, by the holders of a majority of Registrable Securities to be
included in such underwritten offering and (ii) completes and executes all
questionnaires, indemnities, underwriting agreements and other documents
(other than powers of attorney) required under the terms of such
underwriting arrangements.
2.5 Preparation; Reasonable Investigation. In connection with the
preparation and filing of each registration statement under the Securities
Act pursuant to this Agreement, the Company will give the holders of
Registrable Securities registered under such registration statement, their
underwriters, if any, each Requesting Holder and their respective counsel
and accountants, the opportunity to participate in the preparation of such
registration statement, each prospectus included therein or filed with the
Commission, and each amendment thereof or supplement thereto, and will give
each of them such access to its books and records and such opportunities to
discuss the business of the Company with its officers and the independent
public accountants who have certified its financial statements as shall be
necessary, in the opinion of such holders' and such underwriters'
respective counsel, to conduct a reasonable investigation within the
meaning of the Securities Act.
2.6 Indemnification.
(a) Indemnification by the Company. In the event of any
registration of any securities of the Company under the Securities Act, the
Company will, and hereby does agree to, indemnify and hold harmless in the
case of any registration statement filed pursuant to Section 2.1 or 2.2,
the holder of any Registrable Securities covered by such registration
statement, its directors and officers, each other Person who participates
as an underwriter in the offering or sale of such securities and each other
Person, if any, who controls such holder or any such underwriter within the
meaning of the Securities Act, against any losses, claims, damages or
liabilities, joint or several, to which such holder or any such director,
officer, underwriter or controlling Person may become subject under the
Securities Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions or proceedings, whether commenced or threatened, in
respect thereof) arise out of or are based upon any untrue statement or
alleged untrue statement of any material fact contained in any registration
statement under which such securities were registered under the Securities
Act, any preliminary prospectus, final prospectus or summary prospectus
contained therein, or any amendment or supplement thereto, or 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, and the
Company will reimburse such holder, director, officer, underwriter and
controlling Person for any legal or any other expenses reasonably incurred
by them in connection with investigating or defending any such loss, claim,
liability, action or proceeding, provided that the Company shall not be
liable to any such holder, director, officer, underwriter or controlling
Person, as the case may be, in any such case to the extent that any such
loss, claim, damage, liability (or action or proceeding in respect thereof)
or expense arises out of or is based upon an untrue statement or alleged
untrue statement or omission or alleged omission made in such registration
statement, any such preliminary prospectus, final prospectus, summary
prospectus, amendment or supplement in reliance upon and in conformity with
written information furnished to the Company through an instrument duly
executed by such holder or underwriter, as the case may be, specifically
stating that it is for use in the preparation thereof and, provided further
that the Company shall not be liable to any Person who participates as an
underwriter in the offering or sale of Registrable Securities or to any
other Person, if any, who controls such underwriter within the meaning of
the Securities Act, in any such case to the extent that any such loss,
claim, damage, liability (or action or proceeding in respect thereof) or
expense arises out of such Person's failure to send or give a copy of the
final prospectus, as the same may be then supplemented or amended, to the
Person asserting the existence of an untrue statement or alleged untrue
statement or omission or alleged omission at or prior to the written
confirmation of the sale of Registrable Securities to such Person if such
statement or omission was corrected in such final prospectus. Such
indemnity shall remain in full force and effect regardless of any
investigation made by or on behalf of such holder or any such director,
officer, underwriter or controlling Person and shall survive the transfer
of such securities by such holder.
(b) Indemnification by the Sellers. The Company may require, as a
condition to including any Registrable Securities in any registration
statement filed pursuant to Section 2.3, that the Company shall have
received an undertaking satisfactory to it from the prospective seller of
such Registrable Securities, to indemnify and hold harmless (in the same
manner and to the same extent as set forth in Section 2.6(a)) the Company,
each director of the Company, each officer of the Company and each other
person, if any, who controls the Company within the meaning of the
Securities Act, with respect to any statement or alleged statement in or
omission or alleged omission from such registration statement, any
preliminary prospectus, final prospectus or summary prospectus contained
therein, or any amendment or supplement thereto, if such statement or
alleged statement or omission or alleged omission was made in reliance upon
and in conformity with written information furnished to the Company through
an instrument duly executed by such seller specifically stating that it is
for use in the preparation of such registration statement, preliminary
prospectus, final prospectus, summary prospectus, amendment or supplement,
provided, however, that the liability of such indemnifying party under this
Section 2.6(b) shall be limited to the amount of proceeds received by such
indemnifying party in the offering giving rise to such liability. Any such
indemnity shall remain in full force and effect, regardless of any
investigation made by or on behalf of the Company or any such director,
officer or controlling person and shall survive the transfer of such
securities by such seller.
(c) Notices of Claims, etc. Promptly after receipt by an
indemnified party of notice of the commencement of any action or proceeding
involving a claim referred to in the preceding subdivisions of this Section
2.6, such indemnified party will, if a claim in respect thereof is to be
made against an indemnifying party, give written notice to the latter of
the commencement of such action, provided that the failure of any
indemnified party to give notice as provided herein shall not relieve the
indemnifying party of its obligations under the preceding subdivisions of
this Section 2.6, except to the extent that the indemnifying party is
actually prejudiced by such failure to give notice. In case any such action
is brought against an indemnified party, unless in such indemnified party's
reasonable judgment a conflict of interest between such indemnified and
indemnifying parties may exist in respect of such claim, the indemnifying
party shall be entitled to participate in and to assume the defense
thereof, jointly with any other indemnifying party similarly notified, to
the extent that the indemnifying party may wish, with counsel reasonably
satisfactory to such indemnified party, and after notice from the
indemnifying party to such indemnified party of its election so to assume
the defense thereof, the indemnifying party shall not be liable to such
indemnified party for any legal or other expenses subsequently incurred by
the latter in connection with the defense thereof other than reasonable
costs of investigation. No indemnifying party shall, without the consent of
the indemnified party, consent to entry of any judgment or enter into any
settlement of any such action 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. No indemnified party shall consent to entry of any judgment or
enter into any settlement of any such action the defense of which has been
assumed by an indemnifying party without the consent of such indemnifying
party.
(d) Other Indemnification. Indemnification similar to that
specified in the preceding subdivisions of this Section 2.6 (with
appropriate modifications) shall be given by the Company and each seller of
Registrable Securities with respect to any required registration or other
qualification of securities under any Federal or state law or regulation of
any governmental authority, other than the Securities Act.
(e) Indemnification Payments. The indemnification required by this
Section 2.6 shall be made by periodic payments of the amount thereof during
the course of the investigation or defense, as and when bills are received
or expense, loss, damage or liability is incurred.
(f) Contribution. If the indemnification provided for in this
Section 2.6 is unavailable to an indemnified party in respect of any
expense, loss, claim, damage or liability referred to therein, then each
indemnifying party, in lieu of indemnifying such indemnified party, shall
contribute to the amount paid or payable by such indemnified party as a
result of such expense, loss, claim, damage or liability (i) in such
proportion as is appropriate to reflect the relative benefits received by
the Company on the one hand and the holder or underwriter, as the case may
be, on the other from the distribution of the Registrable Securities or
(ii) if the allocation provided by clause (i) above is not permitted by
applicable law, in such proportion as is appropriate to reflect not only
the relative benefits referred to in clause (i) above but also the relative
fault of the Company on the one hand and of the holder or underwriter, as
the case may be, on the other in connection with the statements or
omissions which resulted in such expense, loss, damage or liability, as
well as any other relevant equitable considerations. The relative benefits
received by the Company on the one hand and the holder or underwriter, as
the case may be, on the other in connection with the distribution of the
Registrable Securities shall be deemed to be in the same proportion as the
total net proceeds received by the Company from the initial sale of the
Registrable Securities by the Company to the purchasers pursuant to the
Purchase Agreements bear to the gain, if any, realized by the selling
holder or the underwriting discounts and commissions received by the
underwriter, as the case may be. The relative fault of the Company on the
one hand and of the holder or underwriter, as the case may be, on the other
shall be determined by reference to, among other things, whether the untrue
or alleged untrue statement of a material fact or omission to state a
material fact relates to information supplied by the Company, by the holder
or by the underwriter and the parties' relative intent, knowledge, access
to information and opportunity to correct or prevent such statement or
omission, provided that the foregoing contribution agreement shall not
inure to the benefit of any indemnified party if indemnification would be
unavailable to such indemnified party by reason of the provisions contained
in the first sentence of Section 2.6(a), and in no event shall the
obligation of any indemnifying party to contribute under this Section
2.6(f) exceed the amount that such indemnifying party would have been
obligated to pay by way of indemnification if the indemnification provided
for under Section 2.6(a) or (b) had been available under the circumstances.
The Company and the holders of Registrable Securities agree that it
would not be just and equitable if contribution pursuant to this Section
2.6(f) were determined by pro rata allocation (even if the holders,
Requesting Holders and any underwriters were treated as one entity for such
purpose) or by any other method of allocation that does not take account of
the equitable considerations referred to in the immediately preceding
paragraph. The amount paid or payable by an indemnified party as a result
of the losses, claims, damages and liabilities referred to in the
immediately preceding paragraph shall be deemed to include, subject to the
limitations set forth in the preceding sentence and Section 2.6(c), any
legal or other expenses reasonably incurred by such indemnified party in
connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this Section 2.6(f), no holder of
Registrable Securities or underwriter shall be required to contribute any
amount in excess of the amount by which (i) in the case of any such holder,
the net proceeds received by such holder from the sale of Registrable
Securities or (ii) in the case of an underwriter, the total price at which
the Registrable Securities purchased by it and distributed to the public
were offered to the public exceeds, in any such case, the amount of any
damages that such holder or underwriter has otherwise been required to pay
by reason of such untrue or alleged untrue statement or omission. No Person
guilty of fraudulent misrepresentation (within the meaning of Section 11(f)
of the Securities Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation.
2.7 Adjustments Affecting Registrable Securities. The Company will
not effect or permit to occur any combination or subdivision of Shares
which would adversely affect the ability of the holders of Registrable
Securities to include such Registrable Securities in any registration of
its securities contemplated by this Section 2 or the marketability of such
Registrable Securities under any such registration.
3. Definitions. As used herein, unless the context otherwise
requires, the following terms have the following respective meanings:
Applicable Period: In the case of a proposed registration by an
Initiating Holder or Requesting Holder, as the case may be, of (a)
Conversion Shares and any Related Registrable Securities, 18 months
from the Closing Date, (b) Convertible Preferred Stock and any Related
Registrable Securities, 30 months from the Closing Date and (c) Option
Shares and any Related Registrable Securities, the period ending on the
date of first issuance of Option Shares; provided, however, that the
Applicable Period shall immediately cease upon a mandatory conversion
of the Convertible Preferred Stock pursuant to Section 8.10.1 of the
Certificate of Designation for the Convertible Preferred Stock.
Closing Date: The date on which the Convertible Preferred Stock is
first issued.
Commission: The Securities and Exchange Commission or any other Federal
agency at the time administering the Securities Act.
Common Stock: The common stock, par value $.01 per share, of the
Company.
Company: As defined in the introductory paragraph of this Agreement.
Conversion Shares: The shares of Common Stock issued or issuable upon
conversion of the Convertible Preferred Stock.
Convertible Preferred Stock: As defined in Section 1 of this Agreement.
Exchange Act: The Securities Exchange Act of 1934, or any similar
Federal statute, and the rules and regulations of the Commission
thereunder, all as the same shall be in effect at the time. Reference
to a particular section of the Securities Exchange Act of 1934 shall
include a reference to the comparable section, if any, of any such
similar Federal statute.
Initiating Holders: As defined in Section 2.1 of the Agreement.
Option Shares: Shares of Common Stock issued pursuant to the Stock
Option Agreements dated as of the date hereof between the Company and
affiliates of the Purchasers.
Person: A corporation, an association, a partnership, an organiza-
tion, business, an individual, a governmental or political subdivi-
sion thereof or a governmental agency.
Purchase Agreements: As defined in Section 1.
Registrable Securities: (i) any Conversion Shares and any Related
Registrable Securities, (ii) any Convertible Preferred Stock and any
Related Registrable Securities and (iii) any Option Shares and any
Related Registrable Securities. As to any particular Registrable
Securities, once issued such securities shall cease to be Registrable
Securities when (a) a registration statement with respect to the sale
of such securities shall have become effective under the Securities Act
and such securities shall have been disposed of in accordance with such
registration statement, (b) they shall have been sold as permitted by
Rule 144 (or any successor provision) under the Securities Act, (c)
they shall have been otherwise transferred, new certificates for them
not bearing a legend restricting further transfer shall have been
delivered by the Company and subsequent public distribution of them
shall not require registration of them under the Securities Act, or (d)
they shall have ceased to be outstanding. In calculating a percentage
of Registrable Securities held, each share of Convertible Preferred
Stock shall be deemed to be equivalent to the number of shares of
Common Stock into which it is then convertible.
Registration Expenses: All expenses incident to the Company's
performance of or compliance with Section 2, including, without
limitation, all registration, filing and NASD fees, all stock exchange
listing fees, all fees and expenses of complying with securities or
blue sky laws, all word processing, duplicating and printing expenses,
messenger and delivery expenses, the fees and disbursements of counsel
for the Company and of its independent public accountants, including
the expenses of any special audits or "cold comfort" letters required
by or incident to such performance and compliance, the reasonable fees
and disbursements of one counsel retained by the holder or holders of a
majority of the Registrable Securities being registered, but excluding
underwriting discounts and commissions and transfer taxes, if any,
provided, however, that in the event that the Company shall, in
accordance with Section 2.2(a), not register any securities with
respect to which it had given written notice of its intention to so
register to holders of Registrable Securities, notwithstanding anything
to the contrary in the foregoing, all of the costs incurred by
Requesting Holders in connection with such registration shall be deemed
Registration Expenses.
Related Registrable Securities: With respect to Conversion Shares,
Convertible Preferred Stock or Option Shares, any securities of the
Company issued or issuable with respect to any Conversion Shares,
Convertible Preferred Stock or Option Shares by way of a dividend or
stock split or in connection with a combination of shares,
recapitalization, merger, consolidated or other reorganization or
otherwise.
Requesting Holder: As defined in Section 2.2.
Securities Act: The Securities Act of 1933, or any similar Federal
statute, and the rules and regulations of the Commission thereunder,
all as of the same shall be in effect at the time. References to a
particular section of the Securities Act of 1933 shall include a
reference to the comparable section, if any, of any such similar
Federal statute.
4. Rule 144. The Company shall timely file the reports required to be
filed by it under the Securities Act and the Exchange Act (including but
not limited to the reports under Sections 13 and 15(d) of the Exchange Act
referred to in subparagraph (c) of Rule 144 adopted by the Commission under
the Securities Act) (or, if the Company is not required to file such
reports, will, upon the request of any holder of Registrable Securities,
make publicly available other information) and will take such further
action as any holder of Registrable Securities may reasonably request, all
to the extent required from time to time to enable such holder to sell
Registrable Securities without registration under the Securities Act within
the limitation of the exemptions provided by (a) Rule 144 under the
Securities Act, as such Rule may be amended from time to time, or (b) any
similar rule or regulation hereafter adopted by the Commission. Upon the
request of any holder of Registrable Securities, the Company will deliver
to such holder a written statement as to whether it has complied with the
requirements of this Section 4.
5. Amendments and Waivers. This Agreement may be amended and the
Company may take any action herein prohibited, or omit to perform any act
herein required to be performed by it, only if the Company shall have
obtained the written consent to such amendment, action or omission to act,
of the holder or holders of a majority of the shares of Registrable
Securities. Each holder of any Registrable Securities at the time or
thereafter outstanding shall be bound by any consent authorized by this
Section 5, whether or not such Registrable Securities shall have been
marked to indicate such consent.
6. Nominees for Beneficial Owners. In the event that any Registrable
Securities are held by a nominee for the beneficial owner thereof, the
beneficial owner thereof may, at its election, be treated as the holder of
such Registrable Securities for purposes of any request or other action by
any holder or holders of Registrable Securities pursuant to this Agreement
or any determination of any number or percentage of shares of Registrable
Securities held by any holder or holders of Registrable Securities
contemplated by this Agreement. If the beneficial owner of any Registrable
Securities so elects, the Company may require assurances reasonably
satisfactory to it of such owner's beneficial ownership of such Registrable
Securities.
7. Notices. Except as otherwise provided in this Agreement, all
notices, requests and other communications to any Person provided for
hereunder shall be in writing and shall be given to such Person (a) in the
case of a party hereto other than the Company, addressed to such party in
the manner set forth in the applicable Purchase Agreement or at such other
address as such party shall have furnished to the Company in writing, or
(b) in the case of any other holder of Registrable Securities, at the
address that such holder shall have furnished to the Company in writing,
or, until any such other holder so furnishes to the Company an address,
then to and at the address of the last holder of such Registrable
Securities who has furnished an address to the Company, or (c) in the case
of the Company, at One Athenaeum Street, Cambridge, Massachusetts 02142 to
the attention of its President, or at such other address, or to the
attention of such other officer, as the Company shall have furnished to
each holder of Registrable Securities at the time outstanding. Each such
notice, request or other communication shall be effective (i) if given by
mail, 72 hours after such communication is deposited in the mails with
first class postage prepaid, addressed as aforesaid or (ii) if given by any
other means (including, without limitation, by air courier), when delivered
at the address specified above, provided that any such notice, request or
communication to any holder of Registrable Securities shall not be
effective until received.
8. Assignment. This Agreement shall be binding upon and inure to the
benefit of and be enforceable by the parties hereto and their respective
successors and assigns. In addition, and whether or not any express
assignment shall have been made, the provisions of this Agreement which are
for the benefit of the parties hereto other than the Company shall also be
for the benefit of and enforceable by any subsequent holder of any
Registrable Securities, subject to the provisions respecting the minimum
numbers or percentages of shares of Registrable Securities required in
order to be entitled to certain rights, or take certain actions, contained
herein and provided that the rights of the Purchasers hereunder may only be
assigned to holders of at least 75,000 shares of Convertible Preferred
Stock or underlying Conversion Shares. Any assignee must agree in writing
to be bound by the provisions of this Agreement.
9. Descriptive Headings. The descriptive headings of the several
sections and paragraphs of this Agreement are inserted for reference only
and shall not limit or otherwise affect the meaning hereof.
10. GOVERNING LAW. THIS AGREEMENT SHALL BE CONSTRUED AND ENFORCED IN
ACCORDANCE WITH, AND THE RIGHTS OF THE PARTIES SHALL BE GOVERNED BY, THE
LAWS OF THE COMMONWEALTH OF MASSACHUSETTS WITHOUT REFERENCE TO THE
PRINCIPLES OF CONFLICTS OF LAWS.
11. Counterparts. This Agreement may be executed simultaneously in any
number of counterparts, each of which shall be deemed an original, but all
such counterparts shall together constitute one and the same instrument.
12. Entire Agreement. This Agreement embodies the entire agreement and
understanding between the Company and each other party hereto relating to
the subject matter hereof and supersedes all prior agreements and
understandings relating to such subject matter.
13. Severability. If any provision of this Agreement, or the
application of such provisions to any Person or circumstance, shall be held
invalid, the remainder of this Agreement, or the application of such
provision to Persons or circumstances other than those to which it is held
invalid, shall not be affected thereby.
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed under seal and delivered by their respective officers thereunto duly
authorized as of the date first above written.
THE LEARNING COMPANY, INC.
By: /s/ R. Scott Murray
_______________________________
Name: R. Scott Murray
Title: Executive Vice President and
Chief Financial Officer
PURCHASERS:
THOMAS H. LEE EQUITY FUND III, L.P.
By: THL Equity Advisors III Limited Partnership,
as General Partner
By: THL Equity Trust III,
as General Partner
By /s/ Anthony J. DiNovi
____________________________________
Name: Anthony J. DiNovi
Title: Vice President
THOMAS H. LEE FOREIGN FUND III, L.P.
By: THL Equity Advisors III Limited
Partnership, as General Partner
By: THL Equity Trust III,
as General Partner
By /s/ Anthony J. DiNovi
____________________________________
Name: Anthony J. DiNovi
Title: Vice President
THOMAS H. LEE COMPANY
By /s/ Anthony J. DiNovi
_____________________________________
Name: Anthony J. DiNovi
Title: Managing Director
BAIN CAPITAL FUND V, L.P.
By: Bain Capital Partners V, L.P.,
as General Partner
By: Bain Capital Investors V, Inc.,
as General Partner
By /s/ Mark E. Nunnelly
_____________________________________
Name: Mark E. Nunnelly
Title: Managing Director
BAIN CAPITAL FUND V-B, L.P.
By: Bain Capital Partners V, L.P.,
as General Partner
By: Bain Capital Investors V, Inc.,
as General Partner
By /s/ Mark E. Nunnelly
____________________________________
Name: Mark E. Nunnelly
Title: Managing Director
BCIP ASSOCIATES, L.P.
By /s/ Mark E. Nunnelly
____________________________________
Name: Mark E. Nunnelly
Title: General Partner
BCIP TRUST ASSOCIATES, L.P.
By /s/ Mark E. Nunnelly
____________________________________
Name: Mark E. Nunnelly
Title: Managing Director
CENTRE CAPITAL INVESTORS II, L.P.
CENTRE CAPITAL TAX-EXEMPT INVESTORS II, L.P.
CENTRE CAPITAL OFFSHORE INVESTORS II, L.P.
By: Centre Partners II, L.P.,
as General Partner
By: Centre Partners Management LLC,
as Attorney-in-fact
By /s/ Jonathan H. Kagan
____________________________________
Name: Jonathan H. Kagan
Title: Managing Director
STATE BOARD OF ADMINISTRATION OF FLORIDA
By: Centre Parallel Management Partners, L.P.,
as Manager
By: Centre Partners Management LLC,
as Attorney-in-fact
By /s/ Jonathan H. Kagan
______________________________________
Name: Jonathan H. Kagan
Title: Managing Director
CENTRE PARALLEL MANAGEMENT PARTNERS, L.P.
CENTRE PARTNERS COINVESTMENT, L.P.
By: Centre Partners II LLC,
as General Partner
By /s/ Jonathan H. Kagan
_______________________________________
Name: Jonathan H. Kagan
Title: Managing Director
EXHIBIT E
Power of Attorney
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose
signature appears below, constitutes and appoints each of Scott M.
Sperling and Anthony J. DiNovi, acting individually, as such person's
true and lawful attorney in-fact and agent with full power of
substitution and revocation for such person and in such person's name,
place and stead, in any and all capacities, to execute, acknowledge,
deliver and file any and all filings required by Sections 13 and 16 of
the Securities Exchange Act of 1934, as amended, and the rules and
regulations thereunder, respecting securities of The Learning Company,
Inc., a Delaware corporation, that the undersigned beneficially owns,
including but not limited to, Schedules 13D, Schedules 13G, Forms 3,
Forms 4 and Forms 5.
This power of attorney shall be valid with respect to any of the
undersigned from the date hereof until revoked by such person.
IN WITNESS WHEREOF, each of the undersigned has executed this
instru ment as of the 12th day of December, 1997.
THOMAS H. LEE EQUITY FUND III, L.P.
By: THL Equity Advisors III Limited
Partnership, its General Partner
By: THL Equity Trust III, its General
Partner
By:/s/ Anthony J. DiNovi
--------------------------------------
Name: Anthony J. DiNovi
Title: Vice President
THOMAS H. LEE FOREIGN FUND III, L.P.
By: THL Equity Advisors III Limited
Partnership, its General Partner
By: THL Equity Trust III, its General
Partner
By:/s/ Anthony J. DiNovi
-------------------------------------
Name: Anthony J. DiNovi
Title: Vice President
THL EQUITY ADVISORS III LIMITED PARTNERSHIP
By: THL Equity Trust III, its General
Partner
By:/s/ Anthony J. DiNovi
--------------------------------------
Name: Anthony J. DiNovi
Title: Vice President
THL EQUITY TRUST III
By:/s/ Anthony J. DiNovi
-------------------------------------
Name: Anthony J. DiNovi
Title: Vice President
THL-CCI LIMITED PARTNERSHIP
By: THL Investment Management Corp.,
its General Partner
By: /s/ Wendy Masler
___________________________
Name: Wendy Masler
Title: Vice President
THL INVESTMENT MANAGEMENT CORP.
By:/s/ Wendy Masler
------------------------------------
Name: Wendy Masler
Title: Vice President
/s/ David V. Harkins
------------------------------------
David V. Harkins
THE 1995 HARKINS GIFT TRUST
By:/s/ Sheryll Harkins
-------------------------------------
Name: Sheryll Harkins
Title: Trustee
MEETINGHOUSE FOUNDATION, INC.
By: PNC Bank, New England, as Trustee
By: /s/ Peter K. Van Winkle
_____________________________________
Name: Peter K. Van Winkle
Title: Chief Inv. Officer and SVP
/s/ Scott A. Schoen
----------------------------------------
Scott A. Schoen
/s/ C. Hunter Boll
---------------------------------------
C. Hunter Boll
/s/ Scott M. Sperling
----------------------------------------
Scott M. Sperling
/s/ Anthony J. DiNovi
---------------------------------------
Anthony J. DiNovi
/s/ Thomas M. Hagerty
---------------------------------------
Thomas M. Hagerty
/s/ Warren C. Smith, Jr.
---------------------------------------
Warren C. Smith, Jr.
/s/ Seth W. Lawry
--------------------------------------
Seth W. Lawry
/s/ Joseph J. Incandela
--------------------------------------
Joseph J. Incandela
/s/ Kent R. Weldon
--------------------------------------
Kent R. Weldon
/s/ Terrence M. Mullen
--------------------------------------
Terrence M. Mullen
/s/ Todd M. Abbrecht
--------------------------------------
Todd M. Abbrecht
/s/ Wendy L. Masler
--------------------------------------
Wendy L. Masler
RESOURCES TRUST CO. FBO ANDREW D. FLASTER
By: /s/ Andrew D. Flaster
----------------------------------
Name: Andrew D. Flaster
Title:
/s/ Andrew D. Flaster
--------------------------------------
Andrew D. Flaster
FIRST TRUST CO. FBO KRISTINA A. WATTS
By: /s/ Patricia Kenny
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Name: Patricia Kenny
Title: Sr. Investment Admin. Analyst
/s/ Andrew T. Mulderry
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Andrew T. Mulderry
/s/ George R. Taylor
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George R. Taylor
/s/ Charles W. Robins
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Charles W. Robins
/s/ James Westra
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James Westra
/s/ Charles A. Brizius
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Charles A. Brizius
/s/ Jeffrey B. Kovach
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Jeffrey B. Kovach
/s/ Anjan Mukherjee
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Anjan Mukherjee
/s/ Charles S. Woo
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Charles S. Woo
