<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported):
November 17, 1999
FINANCIAL PERFORMANCE CORPORATION
------------------------------------------------------------------------------
(Exact name of Registrant as specified in its charter)
New York
------------------------------------------------------------------------------
(State or other jurisdiction of incorporation)
0-16530 13-3236325
------------------------ -----------------------------------
(Commission File Number) (I.R.S. Employer Identification No.)
335 Madison Avenue, 8th Floor, New York, New York 10017
------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (212) 557-0401
<PAGE> 2
Item 1. Changes in Control of Registrant.
(a) On November 17, 1999, in consideration of $500,000, Mr. Jeffrey
Silverman ("Silverman") and Mr. Ronald Nash ("Nash") purchased an aggregate of
1,000,000 shares of common stock of Financial Performance Corporation, a New
York corporation (the "Company"), and received options (the "Trump Options") to
purchase an additional 2,500,000 shares of the Company's common stock from
Robert S. Trump ("Trump"), a principal shareholder of the Company. The Trump
Options were granted to each of Silverman and Nash in three tranches: (i) the
first tranch consists of options to purchase 500,000 shares of common stock,
exercisable for two years at $.8125 per share, (ii) the second tranch consists
of options to purchase 500,000 shares of common stock, exercisable for three
years at $1.3125 per share, and (iii) the third tranch consists of options to
purchase 250,000 shares of common stock, exercisable for three years at $5.00
per share.
In addition, on the same date the Company granted to each of Silverman
and Nash five-year options (the "Company Options") to purchase 1,000,000 shares
of the Company's common stock immediately exerciseable at $.43 per share. As a
result, as of November 17, 1999 Silverman and Nash together beneficially owned
an aggregate of 5,690,000 shares of common stock (including 2,500,000 shares
issuable upon exercise of the Trump Options and the 2,000,000 shares issuable
upon exercise of the Company Options), representing approximately 54% of the
Company's shares of common stock.
Silverman and Nash purchased the Company's securities from Trump using
personal funds.
In addition, on November 15, 1999, the Board of Directors of the
Company appointed Silverman and Nash to the Board. Duncan G. Burke, a Board
member of the Company since 1994, also resigned as a Director and Vice
President. The Board of Directors currently consists of Silverman, Nash, William
F. Finley ("Finley"), Ottavio Serena and Richard S. Levy.
In connection with the transaction, the Company entered into a
Stockholder's Agreement dated as of November 17, 1999 (the "Stockholders'
Agreement") with Silverman, Nash and Trump (collectively, the "Stockholders").
Under the Stockholders Agreement, the Stockholders agreed that as long as
Silverman holds more than 500,000 shares of common stock of the Company,
Silverman will have the right to designate himself or another individual as a
nominee for election as a director of the Company, and that as long as Nash
holds more than 500,000 shares of common stock of the Company, Nash will have
the right to designate himself or another individual as a nominee for election
as a director of the Company. In addition, Trump agreed to vote all of the
shares of common stock beneficially owned by him in favor of the election of the
Silverman and Nash designees. In addition, under the Stockholders Agreement,
Trump agreed not to vote his shares in favor of anyof the following actions
without the written consent of Silverman for as long as Silverman owns at least
500,000 shares of common stock, or Nash for so long as Nash owns at least
500,000 shares of common stock: (i) the making, alteration, amendment or repeal
of the Certificate of Incorporation or any part thereof, or the making,
alteration, amendment or repeal of the By-laws or any part thereof, of the
Company or any of its subsidiaries; (ii) the sale of all or substantially all
of the assets of the Company or any of its subsidiaries in any one transaction
or series of related transactions; (iii) the merger, consolidation
<PAGE> 3
or other business combination of the Company or any of its subsidiaries with or
into any other person or entity or a statutory share exchange between the
Company or any of its subsidiaries and any other person or entity; (iv) the
liquidation, dissolution or winding up of the Company or any of its
subsidiaries; or (v) the entering into of any contract, agreement or commitment
to do, the authorization, approval, ratification or confirmation of, or the
delegation of the power to act on behalf of the Company or the Board of
Directors in respect of, any of the foregoing actions.
In connection with the transactions described above, the Company,
Trump, Finley, Silverman and Nash also entered into a Registration Rights
Agreement dated as of November 17, 1999 (the "Registration Rights Agreement").
The Registration Rights Agreement covers all of the shares (including the shares
underlying the options) owned by Trump, Finley, Silverman and Nash on the date
of the agreement. The Registration Rights Agreement includes demand registration
rights for each stockholder and piggyback registration rights and requires the
Company to file a shelf registration statement covering the shares owned by
Trump, Finley, Silverman, and Nash within 120 days from the date of the
agreement. The Registration Rights agreement replaces and supercedes prior
registration rights granted to Trump and Finley.
The Company and Finley also entered into an employment agreement dated
as of November 17, 1999 (the "New Agreement") which amends and restates the
existing Amended and Restated Executive Employment Agreement dated April 21,
1999 between the Company and Finley. Under the terms of the New Agreement, the
Company will pay Finley a base salary of $250,000 per annum. In addition, the
New Agreement extends the term of Finley's employment to December 31, 2000 and
eliminates penalties to the Company for non-renewal of the employment agreement.
The Company paid Finley $250,000 upon execution of the New Agreement and issued
him 100,000 shares of common stock in the Company. The New Agreement also
eliminates Finley's right to terminate and receive payment upon a change of
control. If the Company terminates Finley's employment other than for cause or
by death or disability, or if Finley terminates his employment for Good Reason
(as defined in the agreement), Finley is entitled to his annual base salary
through the end of the Term payable in one lump sum, and may "put" all of the
shares (including shares underlying options, warrants and other convertible
securities) then owned by him to the Company at a per share price equal to the
fair market value.
On November 16, 1999, the Company, its subsidiary Michaelson Kelbick
Partners Inc. ("MKP"), Susan Michaelson ("Michaelson") and Hillary Kelbick
("Kelbick") entered into the First Amendment dated as of November 16, 1999 (the
"Amendment") to the Restated and Amended Shareholders Agreement. Under the
Amendment, Michaelson and Kelbick each have the option to require MKP to
purchase all of their stock of MKP at the cash value (as defined in the
Amendment) of such stock in the event of the termination of their employment,
provided, however, that if MKP terminates Michaelson or Kelbick for cause, MKP
will only be required to pay fifty percent (50%) of the cash value of the stock.
If Michaelson and Kelbick do not exercise their right to have MKP purchase their
stock, MKP may purchase such stock at the agreed value (as defined in the
Amendment).
Michaelson and Kelbick also each entered into a Restated and Amended
Managing Director's Agreement with MKP dated as of November 16, 1999 (for each,
the "Managing Director's Agreement"). Under the amended Managing Director's
Agreement, each managing
2
<PAGE> 4
director may terminate her employment due to a change of control of MKP or the
Company which shall have been in effect for a period of at least ninety (90)
consecutive days, if at any time within six months of the date of the Managing
Director's Agreement the managing director is unable to work harmoniously and
effectively with the personnel constituting the new management of MKP or the
Company resulting from such change of control and only to the extent that such
inability related to matters solely in relation to the management and operations
of MKP. If the managing director's employment is terminated due to disability or
death, there is no longer any provision for the payment of one year's salary.
Item 7. Financial Statements and Exhibits.
(c) The following documents are being filed herewith by the Company as
exhibits to this Current Report on Form 8-K:
10.1 Stock Purchase and Sale Agreement dated as of November 17, 1999 by and
among the Company, Robert S. Trump and Jeffrey Silverman.
10.2 Stock Purchase and Sale Agreement dated as of November 17, 1999 by and
among the Company, Robert S. Trump and Ronald Nash.
10.3 Stockholders Agreement dated as of November 17, 1999 by and among the
Company, Robert S. Trump, Jeffrey Silverman, and Ronald Nash.
10.4 Option Agreement dated November 17, 1999 between Robert S. Trump and
Jeffrey Silverman (for 500,000 options exerciseable for two years at
$.8125 per share).
10.5 Option Agreement dated November 17, 1999 between Robert S. Trump and
Jeffrey Silverman (for 500,000 options exerciseable for three years at
$1.3125 per share).
10.6 Option Agreement dated November 17, 1999 between Robert S. Trump and
Jeffrey Silverman (for 250,000 options exerciseable for three years at
$5.00 per share).
10.7 Option Agreement dated November 17, 1999 between Robert S. Trump and
Ronald Nash (for 500,000 options exerciseable for two years at $.8125
per share).
10.8 Option Agreement dated November 17, 1999 between Robert S. Trump and
Ronald Nash (for 500,000 options exerciseable for three years at
$1.3125 per share).
10.9 Option Agreement dated November 17, 1999 between Robert S. Trump and
Ronald Nash (for 250,000 options exerciseable for three years at $5.00
per share).
10.10 Option Agreement dated as of November 17, 1999 between the Company and
Jeffrey Silverman.
10.11 Option Agreement dated as of November 17, 1999 between the Company and
Ronald Nash.
3
<PAGE> 5
10.12 Registration Rights Agreement dated as of November 17, 1999 by and
among the Company, Robert S. Trump, William F. Finley, Jeffrey
Silverman and Ronald Nash.
10.13 Amended and Restated Employment Agreement dated as of November 17, 1999
between the Company and William F. Finley.
10.14 First Amendment to the Restated and Amended Shareholders Agreement
dated as of November 16, 1999 by and among Michaelson Kelbick Partners,
the Company, Susan Michaelson and Hillary Kelbick.
10.15 Restated and Amended Managing Director's Agreement dated as of November
16, 1999 between Michaelson Kelbick Partners Inc. and Susan Michaelson.
10.16 Restated and Amended Managing Director's Agreement dated as of November
16, 1999 between Michaelson Kelbick Partners Inc. and Hillary Kelbick.
99.1 Press release of Financial Performance Corporation dated November 18,
1999.
4
<PAGE> 6
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed on its behalf by
the undersigned hereunto duly authorized.
FINANCIAL PERFORMANCE CORPORATION
By: /s/ William F. Finley
------------------------------
William F. Finley
Chief Executive Officer
and President
Dated: November 30, 1999
5
<PAGE> 7
EXHIBIT INDEX
Exhibit Description
------- -----------
10.1 Stock Purchase and Sale Agreement dated as of November 17,
1999 by and among the Company, Robert S. Trump and Jeffrey
Silverman.
10.2 Stock Purchase and Sale Agreement dated as of November 17,
1999 by and among the Company, Robert S. Trump and Ronald
Nash.
10.3 Stockholders Agreement dated as of November 17, 1999 by and
among the Company, Robert S. Trump, Jeffrey Silverman, and
Ronald Nash.
10.4 Option Agreement dated November 17, 1999 between Robert S.
Trump and Jeffrey Silverman (for 500,000 options exerciseable
for two years at $.8125 per share).
10.5 Option Agreement dated November 17, 1999 between Robert S.
Trump and Jeffrey Silverman (for 500,000 options exerciseable
for three years at $1.3125 per share).
10.6 Option Agreement dated November 17, 1999 between Robert S.
Trump and Jeffrey Silverman (for 250,000 options exerciseable
for three years at $5.00 per share).
10.7 Option Agreement dated November 17, 1999 between Robert S.
Trump and Ronald Nash (for 500,000 options exerciseable for
two years at $.8125 per share).
10.8 Option Agreement dated November 17, 1999 between Robert S.
Trump and Ronald Nash (for 500,000 options exerciseable for
three years at $1.3125 per share).
10.9 Option Agreement dated November 17, 1999 between Robert S.
Trump and Ronald Nash (for 250,000 options exerciseable for
three years at $5.00 per share).
10.10 Option Agreement dated as of November 17, 1999 between the
Company and Jeffrey Silverman.
10.11 Option Agreement dated as of November 17, 1999 between Robert
S. Trump and Ronald Nash (for 500,000 options exerciseable for
two years at $.8125 per share).
10.12 Registration Rights Agreement dated as of November 17, 1999 by
and among the Company, Robert S. Trump, William F. Finley,
Jeffrey Silverman and Ronald Nash.
10.13 Amended and Restated Employment Agreement dated as of November
17, 1999 between the Company and William F. Finley.
10.14 First Amendment to Restated and Amended Shareholders Agreement
dated as of November 16, 1999 by and among Michaelson Kelbick
Partners, the Company, Susan Michaelson and Hillary Kelbick.
10.15 Restated and Amended Managing Director's Agreement dated as of
November 16, 1999 between Michaelson Kelbick Partners Inc. and
Susan Michaelson.
10.16 Restated and Amended Managing Director's Agreement dated as of
November 16, 1999 between Michaelson Kelbick Partners Inc. and
Hillary Kelbick.
99.1 Press release of Financial Performance Corporation dated
November 18, 1999.
<PAGE> 1
EXHIBIT 10.1
STOCK PURCHASE AND SALE AGREEMENT
AMONG
FINANCIAL PERFORMANCE CORPORATION,
ROBERT S. TRUMP
AND
JEFFREY S. SILVERMAN
Dated as of November 17, 1999
<PAGE> 2
STOCK PURCHASE AND SALE AGREEMENT
STOCK PURCHASE AND SALE AGREEMENT, dated as of November 17,
1999 (this "Agreement"), among Jeffrey S. Silverman (the "Purchaser"), Robert S.
Trump ("Trump") and Financial Performance Corporation, a New York corporation
(the "Company").
WITNESSETH:
The Purchaser desires to acquire from Trump, and Trump desires to issue
and sell to the Purchaser, for the consideration hereinafter provided, 500,000
shares (the "Shares") of the common stock, $.01 par value per share (the "Common
Stock"), of Financial Performance Corporation. As used in this Agreement, the
term the Company shall include Financial Performance Corporation and the
subsidiaries of Financial Performance Corporation.
Certain terms used in this Agreement are defined in Section 7.2 of this
Agreement.
NOW, THEREFORE, in consideration of the promises and mutual covenants
and agreements hereinafter contained, the parties hereto, intending to be
legally bound, hereby agree as follows:
1. Sale and Purchase of Shares.
1.1 Sale and Purchase of Shares. Subject to the terms and
conditions of this Agreement and on the basis of the representations,
warranties, covenants and agreements herein contained, contemporaneously with
the execution hereof, Trump is, selling, assigning and conveying the Shares to
the Purchaser, and the Purchaser is purchasing, acquiring and accepting from
Trump, the Shares.
1.2 Grant of Stock Option. Contemporaneously with the purchase
and sale of the Shares hereunder, Trump is granting to the Purchaser a two-year
option (the "First Stock Option"), the form of which is attached hereto as
Exhibit A, to purchase up to 500,000 additional shares of Common Stock currently
owned by Trump, beneficially and as of record.
1.3 Grant of Stock Option. Contemporaneously with the purchase
and sale of the Shares hereunder, Trump is granting to the Purchaser a
three-year option (the "Second Stock Option"), the form of which is attached
hereto as Exhibit B, to purchase up to 500,000 additional shares of Common Stock
currently owned by Trump, beneficially and as of record.
1.4 Grant of Stock Option. Contemporaneously with the purchase
and sale of the Shares hereunder, Trump is granting to the Purchaser a
three-year option (the "Third Stock Option"), the form of which is attached
hereto as Exhibit C, to purchase up to 250,000 additional shares of Common Stock
currently owned by Trump, beneficially and as of record (the First Stock Option,
the Second Stock Option and the Third Stock Option are hereinafter referred to
as the "Stock Options").
- 2 -
<PAGE> 3
2. Consideration. In full consideration for the Shares and the Stock
Options, the Purchaser is contemporaneously herewith paying to Trump the
purchase price of $250,000, which shall be payable by bank check or by wire
transfer to an account designated by Trump.
3. Representations and Warranties of Trump. Trump hereby represents and
warrants to the Purchaser as follows:
3.1 Authorization of Agreement. Trump has all requisite
capacity, power and authority to execute and deliver this Agreement, the Stock
Option Agreements, the Stockholders' Agreement dated as of the date hereof (the
"Stockholders Agreement") and each other agreement, document, instrument or
certificate contemplated by this Agreement or to be executed by Trump in
connection with the consummation of the transactions contemplated by this
Agreement (this Agreement, the Stock Option Agreements, the Stockholders
Agreement and the other agreements, documents, instruments or certificates
delivered in connection with this Agreement are hereinafter referred to as the
"Transaction Documents"), and to perform fully his obligations hereunder and
thereunder. This Agreement and each of the other Transaction Documents has been
duly and validly executed and delivered by Trump. This Agreement and each of the
other Transaction Documents constitutes the legal, valid and binding obligations
of Trump, enforceable against Trump in accordance with this Agreement and each
of the other Transaction Document's respective terms, subject, as to
enforceability, to applicable bankruptcy, insolvency, reorganization, moratorium
and similar laws affecting creditors' rights and remedies generally and to
general principles of equity (regardless of whether enforcement is sought in a
proceeding at law or in equity).
3.2 No Conflicts; Consents of Third Parties. The execution and
delivery by Trump of this Agreement and the other Transaction Documents, the
consummation of the transactions contemplated hereby or thereby, and the
compliance by Trump with any of the provisions hereof or thereof does not (i)
conflict with, violate, result in the breach or termination of, or constitute a
default or give rise to any "takeback" right or right of termination or
acceleration or right to increase the obligations or otherwise modify the terms
thereof under any Contract, Permit or Order to which Trump is a party or by
which Trump or his properties or assets are bound; (ii) constitute a violation
of any Law applicable to Trump; or (iii) except to the extent and as
specifically created by the Transaction Documents result in the creation of any
Lien upon the properties or assets of Trump. No consent, waiver, approval,
Order, Permit or authorization of, or declaration or filing with, or
notification to, any Person or Governmental Body is required on the part of
Trump in connection with the execution and delivery of this Agreement or the
other Transaction Documents, or the compliance by Trump, with any of the
provisions hereof or thereof, except as expressly and specifically set forth in
the Transaction Documents and except as set forth on Schedule 3.2 to this
Agreement.
3.3 Capitalization. (a) Except as set forth on Schedule 3.3 to
this Agreement, there is no existing option, warrant, call, right, commitment or
other agreement of any character which is currently in effect to which Trump is
a party providing for the issuance, sale or transfer of any shares of capital
stock or other equity securities of the Company or other securities convertible
into, exchangeable for or evidencing the right to subscribe for or purchase
shares of capital stock or other equity securities of the Company, other than
this Agreement, the Stockholders' Agreement, the Stock Option Agreements and the
Registration Rights Agreement
- 3 -
<PAGE> 4
referred to in Section 6.2 below. Trump is not a party to or bound by any voting
trust or other voting agreement with respect to any shares of capital stock or
other contracts or arrangements restricting or relating to such capital stock
or, except as set forth on Schedule 3.3, to any currently effective agreement
relating to the issuance, sale, redemption, transfer or other disposition of
capital stock of the Company, other than this Agreement, the Stockholders'
Agreement, the Stock Option Agreements and the Registration Rights Agreement
referred to in Section 6.2 below.
(b) Trump is the sole beneficial and record owner of the
Shares and the Option Shares, free and clear of all Liens, other than Liens that
arise by operation of federal or state securities laws, and free and clear of
all statutory preemptive rights and all non-statutory preemptive rights except
as set forth in Schedule 3.3.
3.4 Disclaimer. Trump does not make any representations or
warranties to the Purchaser other than those expressly set forth herein.
4. Representations and Warranties of the Company. The Company hereby
represents and warrants to the Purchaser as follows:
(a) This Agreement has been duly and validly authorized,
executed and delivered by the Company. This Agreement constitutes the legal,
valid and binding obligation of the Company, enforceable against the Company in
accordance with its terms, subject, as to enforceability, to applicable
bankruptcy, insolvency, reorganization, moratorium and similar laws affecting
creditors' rights and remedies generally and to general principles of equity
(regardless of whether enforcement is sought in a proceeding at law or in
equity).
(b) No Conflicts; Consents of Third Parties. The execution and
delivery by Trump of this Agreement and the other Transaction Documents, the
consummation of the transactions contemplated hereby or thereby, and the
compliance by Trump with any of the provisions hereof or thereof does not (i)
conflict with, or result in the breach of, any provision of the certificate of
incorporation or by-laws of the Company; (ii) conflict with, violate, result in
the breach or termination of, or constitute a default or give rise to any
"takeback" right or right of termination or acceleration or right to increase
the obligations or otherwise modify the terms thereof under any Contract, Permit
or Order to which the Company is a party or by which the Company or the
properties or assets of the Company are bound; (iii) constitute a violation of
any Law applicable to the Company; or (iv) result in the creation of any Lien
upon the properties or assets of the Company. No consent, waiver, approval,
Order, Permit or authorization of, or declaration or filing with, or
notification to, any Person or Governmental Body is required on the part of the
Company in connection with the execution and delivery of this Agreement or the
other Transaction Documents, or the compliance by the Company, with any of the
provisions hereof or thereof, except as set forth on Schedule 4.1 to this
Agreement or those required by the Registration Rights Agreement including any
and all Securities and Exchange Commission (the "SEC") and Blue Sky filings.
(c) The Company has filed all forms, reports and documents
required to be filed by it under Sections 12, 13, 14 and 15 of the Securities
Exchange Act of 1934, as amended, with the Securities and Exchange Commission
(the "SEC") since December 31, 1997
- 4 -
<PAGE> 5
(collectively, the "Company SEC Reports"). The Company SEC Reports (i) were
prepared in all material respects in accordance with the requirements of the
Securities Act of 1933 or the Securities Exchange Act of 1934, as the case may
be, and (ii) did not at the time they were filed (or if amended or superseded by
a filing prior to the date of this Agreement, then on the date of such filing)
contain any untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading. None of the Company's subsidiaries is required to file any forms,
reports or other documents with the SEC.
(d) Each of the consolidated financial statements (including,
in each case, any related notes thereto) contained in the Company SEC Reports
has been prepared in accordance with generally accepted accounting principles
applied on a consistent basis throughout the periods involved (except as may be
indicated in the notes thereto or in the Company SEC Reports), and each fairly
presents in all material respects the consolidated financial position of the
Company and its subsidiaries as at the respective dates thereof and the
consolidated results of its operations and cash flows for the periods indicated,
except that the unaudited interim financial statements were or are subject to
normal and recurring year-end adjustments which were not or are not expected to
be material in amount.
4.2 Capitalization.
(a) The Shares and the Option Shares are validly issued, fully
paid and non-assessable.
(b) As of the date hereof, the Shares purchased by the
Purchaser constitute 5.223823% of the issued and outstanding capital stock of
Financial Performance Corporation.
4.3 Contracts. There are no agreements between or among the
Company, Michaelson Kelbick Partners Inc. ("MKP"), or any of the managing
directors of MKP other than (a) those agreements that have been previously
disclosed in writing to the Purchaser, (b) agreements involving a monetary
amount less than $50,000 in the aggregate, (c) agreements which would not be
material to, or have a material adverse effect on, the Company, and (d) those
agreements listed on Schedule 4.3.
4.4 No Agreements. The Company is not a party to, and has no
obligations under, any agreement (whether written or oral) or by operation of
law to issue any shares of capital stock or other equity securities of the
Company or other securities convertible into, exchangeable for or evidencing the
right to subscribe for or purchase shares of capital stock or other equity
securities of the Company, to any person or entity, except as set forth in this
Agreement or the other Transaction Documents, or as set forth in Schedule 4.4 to
this Agreement.
4.5 Disclaimer. The Company does not make any representations
or warranties to the Purchaser other than those expressly set forth herein.
5. Representations and Warranties of the Purchaser. The Purchaser
hereby represents and warrants to Trump and the Company as follows:
- 5 -
<PAGE> 6
5.1 Authorization of Agreement. The Purchaser has all
requisite capacity, power and authority to execute and deliver this Agreement,
the Stock Option Agreements, the Stockholders Agreement and each other
agreement, document, instrument or certificate contemplated by this Agreement or
to be executed by the Purchaser in connection with the consummation of the
transactions contemplated by this Agreement, and to perform fully his
obligations hereunder and thereunder. This Agreement and each of the other
Transaction Documents has been duly and validly executed and delivered by the
Purchaser. This Agreement and each of the other Transaction Documents
constitutes the legal, valid and binding obligations of the Purchaser,
enforceable against the Purchaser in accordance with this Agreement and each of
the other Transaction Document's respective terms, subject, as to
enforceability, to applicable bankruptcy, insolvency, reorganization, moratorium
and similar laws affecting creditors' rights and remedies generally and to
general principles of equity (regardless of whether enforcement is sought in a
proceeding at law or in equity).
5.2 No Conflicts; Consents of Third Parties. The execution and
delivery by the Purchaser of this Agreement and the other Transaction Documents,
the consummation of the transactions contemplated hereby or thereby, and the
compliance by the Purchaser with any of the provisions hereof or thereof does
not (i) conflict with, violate, result in the breach or termination of, or
constitute a default or give rise to any "takeback" right or right of
termination or acceleration or right to increase the obligations or otherwise
modify the terms thereof under any Contract, Permit or Order to which the
Purchaser is a party or by which the Purchaser or his properties or assets are
bound, or (ii) constitute a violation of any Law applicable to the Purchaser. No
consent, waiver, approval, Order, Permit or authorization of, or declaration or
filing with, or notification to, any Person or Governmental Body is required on
the part of the Purchaser in connection with the execution and delivery of this
Agreement or the other Transaction Documents, or the compliance by the
Purchaser, with any of the provisions hereof or thereof, except as set forth on
Schedule 5.2 to this Agreement.
5.3 Investment Purpose. The Purchaser is acquiring the Shares
for his own account and not with a view towards resale in violation of the
Securities Act of 1933, as amended (the "Securities Act"); provided, however,
that by making the representations herein, the Purchaser does not agree to hold
any of the Shares for any minimum or other specific term and reserves the right
to dispose of the Shares at any time in accordance with applicable law.
5.4 Information. The Purchaser and his advisors, if any, have
been furnished with all materials relating to the business, finances and
operations of the Company and materials relating to the offer and sale of the
Shares which have been requested by the Purchaser. The Purchaser and his
advisors, if any, have been afforded the opportunity to review materials and to
ask questions of the Company and have reviewed materials and asked questions of
the Company to the extent the Purchaser and his advisors, if any, deem
appropriate. Neither such inquiries nor any other due diligence investigations
conducted by the Purchaser or his advisors, if any, or his representatives shall
modify, amend or affect the Purchaser's right to rely on the representations and
warranties contained in Section 3, as to Trump, and Section 4, as to the
Company, respectively. The Purchaser understands that his investment in the
Shares involves a high degree of risk. The Purchaser has sought such accounting,
legal and tax advice as he has considered necessary to make an informed
investment decision with respect to his acquisition of the Shares.
- 6 -
<PAGE> 7
The Purchaser acknowledges that he has sufficient experience in financial and
business matters to be capable of evaluating the merits and risks of the
prospective investment in the Shares.
5.5 Disclaimer. The Purchaser does not make any
representations or warranties to Trump other than those expressly set forth
herein.
6. Additional Agreements and Covenants of Trump.
6.1 Transfer of Shares. Trump hereby agrees that he will not,
directly or indirectly, Transfer any shares of capital stock of the Company (or
any interest therein), any stock certificates representing the same or any
voting trust certificate issued with respect to said capital stock, or any
option, right or warrant to acquire shares of Common Stock, now or hereafter at
any time owned by him (collectively, the "Remaining Shares"), to any Person (a
"Transferee"), except pursuant to the Stock Option Agreements or as permitted
under the Stockholders Agreement; provided, however, that Trump may Transfer any
of the Remaining Shares to (x) any member of his immediate family, (y) a trust
established for the benefit of any immediate member of his family or (z) any
entity wholly-owned by Trump and established solely for the purpose of holding
title to such shares and performing Trump's obligations under this Agreement, in
each case as long as any Transferee in clause (x), (y) or (z) assumes and agrees
in writing to be bound by all of the terms of this Agreement; provided, further,
that Trump may Transfer any of the Remaining Shares by pledge or hypothecation
if the Transferee assumes and agrees in writing to be bound by all of the terms
of this Agreement. Notwithstanding the provisos to the prior sentence or
anything to the contrary contained herein, Trump may not Transfer any of the
Option Shares which are subject to a Stock Option Agreement until such Stock
Option Agreement has terminated or expired. For purposes of this Agreement,
"Transfer" shall mean with respect to any capital stock, (i) any sale,
assignment or transfer of such capital stock or any right or interest therein,
(ii) any pledge or hypothecation of such capital stock or any interest therein,
(iii) any grant, sale or other transfer of securities convertible into or
exchangeable or exercisable for or other options, warrants or rights to acquire
such capital stock or any interest therein and (iv) any other direct or indirect
transfer of such capital stock or any interest therein, including by operation
of law (it being understood that any transferee by operation of law shall be
required to comply with the provisions of this Section 6.1).
6.2 Trump hereby transfers, sets over and assigns to Silverman
all of Trump's right, title and interest, in and to, the Registration Rights
Agreement dated the date hereof among Financial Performance Corporation, Trump,
William Finley, the Purchaser and Jeffrey S. Silverman with respect to the
Shares and the Option Shares.
7. Miscellaneous.
7.1 Survival of Representations and Warranties. The
representations and warranties contained in this Agreement shall survive the
Closing for the benefit of the parties hereto; provided, however, that the
representations and warranties of the Company other than Section 4.2(a) shall
expire one year from the date hereof; provided, further, however, that the
representations and warranties of the Purchaser to the Company shall expire one
year from the date hereof.
- 7 -
<PAGE> 8
7.2 Certain Definitions.
"Affiliate" shall have the meaning specified by Rule 12b-2
under the Securities Exchange Act of 1934, as amended.
"Contract" means any contract, agreement, indenture, note,
bond, loan, instrument, lease, conditional sale contract, mortgage, license,
franchise, insurance policy. commitment or other arrangement or agreement,
whether written or oral.
"Governmental Body" means any governmental or regulatory body,
or political subdivision thereof, whether federal, state, local or foreign, or
any agency, instrumentality or authority thereof, or any court or arbitrator
(public or private).
"Law" means any federal, state, local or foreign law
(including common law), statute, code, ordinance, rule, regulation or other
requirement or guideline.
"Lien" means any lien, pledge, hypothecation, levy, mortgage,
deed of trust, security interest, claim, lease, charge, option, right of first
refusal, easement, or other real estate declaration, covenant, condition,
restriction or servitude, transfer restriction under any shareholder or similar
agreement, encumbrance or any other restriction or limitation whatsoever.
"Option Shares" means the shares of Common Stock issuable upon
the exercise of the Stock Options pursuant to the terms of the Stock Option
Agreements.
"Order" means any order, consent, consent order, injunction,
judgment, decree, consent decree, ruling, writ, assessment or arbitration award.
"Permit" means any approval, authorization, registration,
consent, license, permit or certificate by any Governmental Body.
"Person" means any individual, corporation, partnership, firm,
joint venture, association, joint-stock company, trust, unincorporated
organization, Governmental Body or other entity.
"Stock Option Agreements" means the agreements attached as
Exhibits A, B and C hereto, regarding the First Stock Option, Second Stock
Option and the Third Option.
7.3 Governing Law. This Agreement shall be governed by and
construed in accordance with the internal laws of the State of New York without
giving effect to the principles of conflict of laws thereunder.
7.4 Notices. All notices and other communications under this
Agreement shall be in writing and shall be deemed given when delivered
personally, upon delivery to a nationally recognized overnight courier service,
or when mailed by certified mail, return receipt requested, to the parties at
the following addresses (or to such other address as a party may have specified
by notice given to the other party pursuant to this provision):
- 8 -
<PAGE> 9
If to Trump, to:
Robert S. Trump
c/o Trump Management, Inc.
2611 W. 2nd Street
Brooklyn, New York 11223
Telephone: (718) 743-4400
Fax: (718) 891-3609
With a copy to:
Gary Friedman
Kaufman, Friedman, Plotnicki & Grun, LLP
300 E. 42nd Street
New York, New York 10017
Telephone: (212) 973-3320
Fax: (212) 687-3179
If to the Purchaser, to:
Jeffrey S. Silverman
LTS Capital Partners
777 Third Avenue
New York, New York 10017
Telephone: (212) 446-0229
Fax: (212) 421-2933
With a copy to:
Kramer Levin Naftalis & Frankel LLP
919 Third Avenue
New York, NY 10022
Attention: Howard A. Sobel
Telephone: (212) 715-9326
Fax: (212) 715-8000
If to the Company, to:
Financial Performance Corporation
335 Madison Avenue, 8th Floor
New York, New York 10017
Attention: President
Telephone: (212) 557-0401
Fax: (212) 557-0490
- 9 -
<PAGE> 10
With a copy to:
Baer Marks & Upham LLP
805 Third Avenue
New York, New York ____
Attention: Jonathan J. Russo
Telephone: (212) 702-5714
Fax: (212) 702-5941
All notices are effective upon receipt or upon refusal if properly delivered.
7.5 Severability. If any term, provision, covenant or
condition of this Agreement or part thereof, or the application thereof to any
Person, place or circumstance shall be held to be invalid, unenforceable or void
by a court of competent jurisdiction, the remainder of this Agreement and such
term, provision, covenant or condition shall remain in full force and effect,
and any such invalid, unenforceable or void term, provision, covenant or
condition shall be deemed, without further action on the part of the parties
hereto, modified, amended and limited, and the court shall have the power to
modify, amend, and limit such term, provision, covenant or condition, to the
extent necessary to render the same and the remainder of this Agreement valid,
enforceable and lawful.
7.6 Binding Effect, Assignment. This Agreement shall be
binding upon and inure to the benefit of the parties and their respective
permitted successors and assigns. Nothing in this Agreement shall create or be
deemed to create any third party beneficiary rights or any other rights of any
kind in any Person or entity not a party to this Agreement except as provided
below. No assignment of this Agreement or of any rights or obligations hereunder
may be made by Trump (by operation of law or otherwise) without the prior
written consent of the Purchaser, except as provided herein, and any attempted
assignment without such required consent shall be void. The Purchaser may assign
this Agreement and any or all rights and obligations hereunder, in whole or in
part, to any Affiliate of the Purchaser or any purchaser of not less than
500,000 shares of Common Stock owned by the Purchaser, whether direct or
indirect, by purchase, merger, consolidation, operation of law or otherwise (any
such Affiliate or purchaser, a "Successor"). The Purchaser will require any such
Successor to expressly assume and agree to perform this Agreement in the same
manner and to the same extent that the Purchaser would be required to perform it
if no such purchase, or succession had taken place. Upon any such permitted
purchase or succession the references in this Agreement to the Purchaser shall
also apply to any Successor unless the context otherwise requires.
7.7 Public Announcement. The parties shall cooperate with
respect to any public announcement relating to the transactions contemplated
hereby or by the other Transaction Documents; and none of the parties will issue
any public statement announcing such transaction without the prior consent of
the others (which shall not be unreasonably withheld, delayed or conditioned),
except as such party in good faith (based upon advice of counsel) believes is
required by law and following notice to the other parties. If within three (3)
Business Days after such notice to the other parties has been given, neither
other party responds, their consents shall be deemed given.
- 10 -
<PAGE> 11
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed as of the date first written above.
-----------------------------------
ROBERT S. TRUMP
-----------------------------------
JEFFREY S. SILVERMAN
FINANCIAL PERFORMANCE CORPORATION
By:
-------------------------------
Name:
Title:
- 11 -
<PAGE> 12
SCHEDULE 3.2
to
Stock Purchase and Sale Agreement
1. Filings under Section 13 of the Securities Exchange Act of 1934, as amended.
2. Filings under Section 16 of the Securities Exchange Act of 1934, as amended.
3. Prospectus delivery requirements pursuant to the Securities Act of 1933, as
amended.
- 12 -
<PAGE> 13
SCHEDULE 3.3
to
Stock Purchase and Sale Agreement
None
- 13 -
<PAGE> 14
SCHEDULE 4.3
to
Stock Purchase and Sale Agreement
1. Restated and Amended Managing Directors Agreement dated November 16,
1999 between MKP and Susan Michaelson.
2. Restated and Amended Managing Directors Agreement dated November 16,
1999 between MKP and Hillary Kelbick.
3. First Amendment to Restated and Amended Shareholders Agreement by and
among MKP, Financial Performance Corporation, Susan Michaelson and
Hillary Kelbick dated November 16, 1999.
- 14 -
<PAGE> 15
SCHEDULE 4.4
to
Stock Purchase and Sale Agreement
SCHEDULE OF WARRANT HOLDERS
FINANCIAL PERFORMANCE CORPORATION
DATE: November 12, 1999
1. Warrants dated September 15, 1995 (exercisable at $0.50/share until
9-15-2010)
<TABLE>
<CAPTION>
Holder No. of Warrants
------ ---------------
<S> <C>
William F. Finley 200,000
</TABLE>
2. Warrants dated September 15, 1996 (exercisable at $1.00/share until
9-15-2006)
<TABLE>
<CAPTION>
Holder No. of Warrants
------ ---------------
<S> <C>
William F. Finley 200,000
Susan Michaelson 200,000
Hillary Kelbick 200,000
Richard Levy 50,000
Duncan G. Burke 50,000
Phillip L. Hage 25,000
</TABLE>
3. Warrants dated September 16, 1996 (exercisable at $1.00/share until
9-15-2006)
<TABLE>
<CAPTION>
Holder No. of Warrants
------ ---------------
<S> <C>
Nora Byrne 5,000
Siobhan Glennon 5,000
Debra Kruper 5,000
Pamela Reich 5,000
</TABLE>
4. Warrants dated December 1, 1996 (exercisable at $0.50/share until
11-30-1999)
<TABLE>
<CAPTION>
Holder No. of Warrants
------ ---------------
<S> <C>
Van Kasper & Company 150,000
</TABLE>
- 15 -
<PAGE> 16
5. Warrants dated December 29, 1997 (exercisable at $0.50/share until
11-30-1999)*
<TABLE>
<CAPTION>
Holder No. of Warrants
------ ---------------
<S> <C>
Richard Levy 50,000
Duncan G. Burke 50,000
</TABLE>
6. Warrants dated October 21, 1998 (exercisable at $0.50/share until
10-31-2001)*
<TABLE>
<CAPTION>
Holder No. of Warrants
------ ---------------
<S> <C>
Richard Levy 100,000
Duncan G. Burke 100,000
Ottavio Serena 200,000
Gary S. Friedman 50,000
Charlotte Tuck 50,000
</TABLE>
* Warrant expiration date extended until November 30, 2004.
- 16 -
<PAGE> 17
SCHEDULE 5.2
to
Stock Purchase and Sale Agreement
1. Filings under Section 13 of the Securities Exchange Act of 1934, as amended.
2. Filings under Section 16 of the Securities Exchange Act of 1934, as amended.
- 17 -
<PAGE> 1
EXHIBIT 10.2
STOCK PURCHASE AND SALE AGREEMENT
AMONG
FINANCIAL PERFORMANCE CORPORATION,
ROBERT S. TRUMP
AND
RONALD NASH
Dated as of November 17, 1999
<PAGE> 2
STOCK PURCHASE AND SALE AGREEMENT
STOCK PURCHASE AND SALE AGREEMENT, dated as of November 17,
1999 (this "Agreement"), among Ronald Nash (the "Purchaser"), Robert S. Trump
("Trump") and Financial Performance Corporation, a New York corporation (the
"Company").
WITNESSETH:
The Purchaser desires to acquire from Trump, and Trump desires to issue
and sell to the Purchaser, for the consideration hereinafter provided, 500,000
shares (the "Shares") of the common stock, $.01 par value per share (the "Common
Stock"), of Financial Performance Corporation. As used in this Agreement, the
term the Company shall include Financial Performance Corporation and the
subsidiaries of Financial Performance Corporation.
Certain terms used in this Agreement are defined in Section 7.2 of this
Agreement.
NOW, THEREFORE, in consideration of the promises and mutual covenants
and agreements hereinafter contained, the parties hereto, intending to be
legally bound, hereby agree as follows:
1. Sale and Purchase of Shares.
1.1 Sale and Purchase of Shares. Subject to the terms and
conditions of this Agreement and on the basis of the representations,
warranties, covenants and agreements herein contained, contemporaneously with
the execution hereof, Trump is, selling, assigning and conveying the Shares to
the Purchaser, and the Purchaser is purchasing, acquiring and accepting from
Trump, the Shares.
1.2 Grant of Stock Option. Contemporaneously with the purchase
and sale of the Shares hereunder, Trump is granting to the Purchaser a two-year
option (the "First Stock Option"), the form of which is attached hereto as
Exhibit A, to purchase up to 500,000 additional shares of Common Stock currently
owned by Trump, beneficially and as of record.
1.3 Grant of Stock Option. Contemporaneously with the purchase
and sale of the Shares hereunder, Trump is granting to the Purchaser a
three-year option (the "Second Stock Option"), the form of which is attached
hereto as Exhibit B, to purchase up to 500,000 additional shares of Common Stock
currently owned by Trump, beneficially and as of record.
1.4 Grant of Stock Option. Contemporaneously with the purchase
and sale of the Shares hereunder, Trump is granting to the Purchaser a
three-year option (the "Third Stock Option"), the form of which is attached
hereto as Exhibit C, to purchase up to 250,000 additional shares of Common Stock
currently owned by Trump, beneficially and as of record (the First Stock Option,
the Second Stock Option and the Third Stock Option are hereinafter referred to
as the "Stock Options").
- 2 -
<PAGE> 3
2. Consideration. In full consideration for the Shares and the Stock
Options, the Purchaser is contemporaneously herewith paying to Trump the
purchase price of $250,000, which shall be payable by bank check or by wire
transfer to an account designated by Trump.
3. Representations and Warranties of Trump. Trump hereby represents and
warrants to the Purchaser as follows:
3.1 Authorization of Agreement. Trump has all requisite
capacity, power and authority to execute and deliver this Agreement, the Stock
Option Agreements, the Stockholders' Agreement dated as of the date hereof (the
"Stockholders Agreement") and each other agreement, document, instrument or
certificate contemplated by this Agreement or to be executed by Trump in
connection with the consummation of the transactions contemplated by this
Agreement (this Agreement, the Stock Option Agreements, the Stockholders
Agreement and the other agreements, documents, instruments or certificates
delivered in connection with this Agreement are hereinafter referred to as the
"Transaction Documents"), and to perform fully his obligations hereunder and
thereunder. This Agreement and each of the other Transaction Documents has been
duly and validly executed and delivered by Trump. This Agreement and each of the
other Transaction Documents constitutes the legal, valid and binding obligations
of Trump, enforceable against Trump in accordance with this Agreement and each
of the other Transaction Document's respective terms, subject, as to
enforceability, to applicable bankruptcy, insolvency, reorganization, moratorium
and similar laws affecting creditors' rights and remedies generally and to
general principles of equity (regardless of whether enforcement is sought in a
proceeding at law or in equity).
3.2 No Conflicts; Consents of Third Parties. The execution and
delivery by Trump of this Agreement and the other Transaction Documents, the
consummation of the transactions contemplated hereby or thereby, and the
compliance by Trump with any of the provisions hereof or thereof does not (i)
conflict with, violate, result in the breach or termination of, or constitute a
default or give rise to any "takeback" right or right of termination or
acceleration or right to increase the obligations or otherwise modify the terms
thereof under any Contract, Permit or Order to which Trump is a party or by
which Trump or his properties or assets are bound; (ii) constitute a violation
of any Law applicable to Trump; or (iii) except to the extent and as
specifically created by the Transaction Documents result in the creation of any
Lien upon the properties or assets of Trump. No consent, waiver, approval,
Order, Permit or authorization of, or declaration or filing with, or
notification to, any Person or Governmental Body is required on the part of
Trump in connection with the execution and delivery of this Agreement or the
other Transaction Documents, or the compliance by Trump, with any of the
provisions hereof or thereof, except as expressly and specifically set forth in
the Transaction Documents and except as set forth on Schedule 3.2 to this
Agreement.
3.3 Capitalization. (a) Except as set forth on Schedule 3.3 to
this Agreement, there is no existing option, warrant, call, right, commitment or
other agreement of any character which is currently in effect to which Trump is
a party providing for the issuance, sale or transfer of any shares of capital
stock or other equity securities of the Company or other securities convertible
into, exchangeable for or evidencing the right to subscribe for or purchase
shares of capital stock or other equity securities of the Company, other than
this Agreement, the Stockholders' Agreement, the Stock Option Agreements and the
Registration Rights Agreement
- 3 -
<PAGE> 4
referred to in Section 6.2 below. Trump is not a party to or bound by any voting
trust or other voting agreement with respect to any shares of capital stock or
other contracts or arrangements restricting or relating to such capital stock
or, except as set forth on Schedule 3.3, to any currently effective agreement
relating to the issuance, sale, redemption, transfer or other disposition of
capital stock of the Company, other than this Agreement, the Stockholders'
Agreement, the Stock Option Agreements and the Registration Rights Agreement
referred to in Section 6.2 below.
(b) Trump is the sole beneficial and record owner of the
Shares and the Option Shares, free and clear of all Liens, other than Liens that
arise by operation of federal or state securities laws, and free and clear of
all statutory preemptive rights and all non-statutory preemptive rights except
as set forth in Schedule 3.3.
3.4 Disclaimer. Trump does not make any representations or
warranties to the Purchaser other than those expressly set forth herein.
4. Representations and Warranties of the Company. The Company hereby
represents and warrants to the Purchaser as follows:
(a) This Agreement has been duly and validly authorized,
executed and delivered by the Company. This Agreement constitutes the legal,
valid and binding obligation of the Company, enforceable against the Company in
accordance with its terms, subject, as to enforceability, to applicable
bankruptcy, insolvency, reorganization, moratorium and similar laws affecting
creditors' rights and remedies generally and to general principles of equity
(regardless of whether enforcement is sought in a proceeding at law or in
equity).
(b) No Conflicts; Consents of Third Parties. The execution and
delivery by Trump of this Agreement and the other Transaction Documents, the
consummation of the transactions contemplated hereby or thereby, and the
compliance by Trump with any of the provisions hereof or thereof does not (i)
conflict with, or result in the breach of, any provision of the certificate of
incorporation or by-laws of the Company; (ii) conflict with, violate, result in
the breach or termination of, or constitute a default or give rise to any
"takeback" right or right of termination or acceleration or right to increase
the obligations or otherwise modify the terms thereof under any Contract, Permit
or Order to which the Company is a party or by which the Company or the
properties or assets of the Company are bound; (iii) constitute a violation of
any Law applicable to the Company; or (iv) result in the creation of any Lien
upon the properties or assets of the Company. No consent, waiver, approval,
Order, Permit or authorization of, or declaration or filing with, or
notification to, any Person or Governmental Body is required on the part of the
Company in connection with the execution and delivery of this Agreement or the
other Transaction Documents, or the compliance by the Company, with any of the
provisions hereof or thereof, except as set forth on Schedule 4.1 to this
Agreement or those required by the Registration Rights Agreement including any
and all Securities and Exchange Commission (the "SEC") and Blue Sky filings.
(c) The Company has filed all forms, reports and documents
required to be filed by it under Sections 12, 13, 14 and 15 of the Securities
Exchange Act of 1934, as amended, with the Securities and Exchange Commission
(the "SEC") since December 31, 1997
- 4 -
<PAGE> 5
(collectively, the "Company SEC Reports"). The Company SEC Reports (i) were
prepared in all material respects in accordance with the requirements of the
Securities Act of 1933 or the Securities Exchange Act of 1934, as the case may
be, and (ii) did not at the time they were filed (or if amended or superseded by
a filing prior to the date of this Agreement, then on the date of such filing)
contain any untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading. None of the Company's subsidiaries is required to file any forms,
reports or other documents with the SEC.
(d) Each of the consolidated financial statements (including,
in each case, any related notes thereto) contained in the Company SEC Reports
has been prepared in accordance with generally accepted accounting principles
applied on a consistent basis throughout the periods involved (except as may be
indicated in the notes thereto or in the Company SEC Reports), and each fairly
presents in all material respects the consolidated financial position of the
Company and its subsidiaries as at the respective dates thereof and the
consolidated results of its operations and cash flows for the periods indicated,
except that the unaudited interim financial statements were or are subject to
normal and recurring year-end adjustments which were not or are not expected to
be material in amount.
4.2 Capitalization.
(a) The Shares and the Option Shares are validly issued, fully
paid and non-assessable.
(b) As of the date hereof, the Shares purchased by the
Purchaser constitute 5.223823% of the issued and outstanding capital stock of
Financial Performance Corporation.
4.3 Contracts. There are no agreements between or among the
Company, Michaelson Kelbick Partners Inc. ("MKP"), or any of the managing
directors of MKP other than (a) those agreements that have been previously
disclosed in writing to the Purchaser, (b) agreements involving a monetary
amount less than $50,000 in the aggregate, (c) agreements which would not be
material to, or have a material adverse effect on, the Company, and (d) those
agreements listed on Schedule 4.3.
4.4 No Agreements. The Company is not a party to, and has no
obligations under, any agreement (whether written or oral) or by operation of
law to issue any shares of capital stock or other equity securities of the
Company or other securities convertible into, exchangeable for or evidencing the
right to subscribe for or purchase shares of capital stock or other equity
securities of the Company, to any person or entity, except as set forth in this
Agreement or the other Transaction Documents, or as set forth in Schedule 4.4 to
this Agreement.
4.5 Disclaimer. The Company does not make any representations
or warranties to the Purchaser other than those expressly set forth herein.
5. Representations and Warranties of the Purchaser. The Purchaser
hereby represents and warrants to Trump and the Company as follows:
- 5 -
<PAGE> 6
5.1 Authorization of Agreement. The Purchaser has all
requisite capacity, power and authority to execute and deliver this Agreement,
the Stock Option Agreements, the Stockholders Agreement and each other
agreement, document, instrument or certificate contemplated by this Agreement or
to be executed by the Purchaser in connection with the consummation of the
transactions contemplated by this Agreement, and to perform fully his
obligations hereunder and thereunder. This Agreement and each of the other
Transaction Documents has been duly and validly executed and delivered by the
Purchaser. This Agreement and each of the other Transaction Documents
constitutes the legal, valid and binding obligations of the Purchaser,
enforceable against the Purchaser in accordance with this Agreement and each of
the other Transaction Document's respective terms, subject, as to
enforceability, to applicable bankruptcy, insolvency, reorganization, moratorium
and similar laws affecting creditors' rights and remedies generally and to
general principles of equity (regardless of whether enforcement is sought in a
proceeding at law or in equity).
5.2 No Conflicts; Consents of Third Parties. The execution and
delivery by the Purchaser of this Agreement and the other Transaction Documents,
the consummation of the transactions contemplated hereby or thereby, and the
compliance by the Purchaser with any of the provisions hereof or thereof does
not (i) conflict with, violate, result in the breach or termination of, or
constitute a default or give rise to any "takeback" right or right of
termination or acceleration or right to increase the obligations or otherwise
modify the terms thereof under any Contract, Permit or Order to which the
Purchaser is a party or by which the Purchaser or his properties or assets are
bound, or (ii) constitute a violation of any Law applicable to the Purchaser. No
consent, waiver, approval, Order, Permit or authorization of, or declaration or
filing with, or notification to, any Person or Governmental Body is required on
the part of the Purchaser in connection with the execution and delivery of this
Agreement or the other Transaction Documents, or the compliance by the
Purchaser, with any of the provisions hereof or thereof, except as set forth on
Schedule 5.2 to this Agreement.
5.3 Investment Purpose. The Purchaser is acquiring the Shares
for his own account and not with a view towards resale in violation of the
Securities Act of 1933, as amended (the "Securities Act"); provided, however,
that by making the representations herein, the Purchaser does not agree to hold
any of the Shares for any minimum or other specific term and reserves the right
to dispose of the Shares at any time in accordance with applicable law.
5.4 Information. The Purchaser and his advisors, if any, have
been furnished with all materials relating to the business, finances and
operations of the Company and materials relating to the offer and sale of the
Shares which have been requested by the Purchaser. The Purchaser and his
advisors, if any, have been afforded the opportunity to review materials and to
ask questions of the Company and have reviewed materials and asked questions of
the Company to the extent the Purchaser and his advisors, if any, deem
appropriate. Neither such inquiries nor any other due diligence investigations
conducted by the Purchaser or his advisors, if any, or his representatives shall
modify, amend or affect the Purchaser's right to rely on the representations and
warranties contained in Section 3, as to Trump, and Section 4, as to the
Company, respectively. The Purchaser understands that his investment in the
Shares involves a high degree of risk. The Purchaser has sought such accounting,
legal and tax advice as he has considered necessary to make an informed
investment decision with respect to his acquisition of the Shares.
- 6 -
<PAGE> 7
The Purchaser acknowledges that he has sufficient experience in financial and
business matters to be capable of evaluating the merits and risks of the
prospective investment in the Shares.
5.5 Disclaimer. The Purchaser does not make any
representations or warranties to Trump other than those expressly set forth
herein.
6. Additional Agreements and Covenants of Trump.
6.1 Transfer of Shares. Trump hereby agrees that he will not,
directly or indirectly, Transfer any shares of capital stock of the Company (or
any interest therein), any stock certificates representing the same or any
voting trust certificate issued with respect to said capital stock, or any
option, right or warrant to acquire shares of Common Stock, now or hereafter at
any time owned by him (collectively, the "Remaining Shares"), to any Person (a
"Transferee"), except pursuant to the Stock Option Agreements or as permitted
under the Stockholders Agreement; provided, however, that Trump may Transfer any
of the Remaining Shares to (x) any member of his immediate family, (y) a trust
established for the benefit of any immediate member of his family or (z) any
entity wholly-owned by Trump and established solely for the purpose of holding
title to such shares and performing Trump's obligations under this Agreement, in
each case as long as any Transferee in clause (x), (y) or (z) assumes and agrees
in writing to be bound by all of the terms of this Agreement; provided, further,
that Trump may Transfer any of the Remaining Shares by pledge or hypothecation
if the Transferee assumes and agrees in writing to be bound by all of the terms
of this Agreement. Notwithstanding the provisos to the prior sentence or
anything to the contrary contained herein, Trump may not Transfer any of the
Option Shares which are subject to a Stock Option Agreement until such Stock
Option Agreement has terminated or expired. For purposes of this Agreement,
"Transfer" shall mean with respect to any capital stock, (i) any sale,
assignment or transfer of such capital stock or any right or interest therein,
(ii) any pledge or hypothecation of such capital stock or any interest therein,
(iii) any grant, sale or other transfer of securities convertible into or
exchangeable or exercisable for or other options, warrants or rights to acquire
such capital stock or any interest therein and (iv) any other direct or indirect
transfer of such capital stock or any interest therein, including by operation
of law (it being understood that any transferee by operation of law shall be
required to comply with the provisions of this Section 6.1).
6.2 Trump hereby transfers, sets over and assigns to Silverman
all of Trump's right, title and interest, in and to, the Registration Rights
Agreement dated the date hereof among Financial Performance Corporation, Trump,
William Finley, the Purchaser and Ronald Nash with respect to the Shares and the
Option Shares.
7. Miscellaneous.
7.1 Survival of Representations and Warranties. The
representations and warranties contained in this Agreement shall survive the
Closing for the benefit of the parties hereto; provided, however, that the
representations and warranties of the Company other than Section 4.2(a) shall
expire one year from the date hereof; provided, further, however, that the
representations and warranties of the Purchaser to the Company shall expire one
year from the date hereof.
- 7 -
<PAGE> 8
7.2 Certain Definitions.
"Affiliate" shall have the meaning specified by Rule 12b-2
under the Securities Exchange Act of 1934, as amended.
"Contract" means any contract, agreement, indenture, note,
bond, loan, instrument, lease, conditional sale contract, mortgage, license,
franchise, insurance policy. commitment or other arrangement or agreement,
whether written or oral.
"Governmental Body" means any governmental or regulatory body,
or political subdivision thereof, whether federal, state, local or foreign, or
any agency, instrumentality or authority thereof, or any court or arbitrator
(public or private).
"Law" means any federal, state, local or foreign law
(including common law), statute, code, ordinance, rule, regulation or other
requirement or guideline.
"Lien" means any lien, pledge, hypothecation, levy, mortgage,
deed of trust, security interest, claim, lease, charge, option, right of first
refusal, easement, or other real estate declaration, covenant, condition,
restriction or servitude, transfer restriction under any shareholder or similar
agreement, encumbrance or any other restriction or limitation whatsoever.
"Option Shares" means the shares of Common Stock issuable upon
the exercise of the Stock Options pursuant to the terms of the Stock Option
Agreements.
"Order" means any order, consent, consent order, injunction,
judgment, decree, consent decree, ruling, writ, assessment or arbitration award.
"Permit" means any approval, authorization, registration,
consent, license, permit or certificate by any Governmental Body.
"Person" means any individual, corporation, partnership, firm,
joint venture, association, joint-stock company, trust, unincorporated
organization, Governmental Body or other entity.
"Stock Option Agreements" means the agreements attached as
Exhibits A, B and C hereto, regarding the First Stock Option, Second Stock
Option and the Third Option.
7.3 Governing Law. This Agreement shall be governed by and
construed in accordance with the internal laws of the State of New York without
giving effect to the principles of conflict of laws thereunder.
7.4 Notices. All notices and other communications under this
Agreement shall be in writing and shall be deemed given when delivered
personally, upon delivery to a nationally recognized overnight courier service,
or when mailed by certified mail, return receipt requested, to the parties at
the following addresses (or to such other address as a party may have specified
by notice given to the other party pursuant to this provision):
- 8 -
<PAGE> 9
If to Trump, to:
Robert S. Trump
c/o Trump Management, Inc.
2611 W. 2nd Street
Brooklyn, New York 11223
Telephone: (718) 743-4400
Fax: (718) 891-3609
With a copy to:
Gary Friedman
Kaufman, Friedman, Plotnicki & Grun, LLP
300 E. 42nd Street
New York, New York 10017
Telephone: (212) 973-3320
Fax: (212) 687-3179
If to the Purchaser, to:
Ronald Nash
LTS Capital Partners
777 Third Avenue
New York, New York 10017
Telephone: (212) 446-0229
Fax: (212) 421-2933
With a copy to:
Kramer Levin Naftalis & Frankel LLP
919 Third Avenue
New York, NY 10022
Attention: Howard A. Sobel
Telephone: (212) 715-9326
Fax: (212) 715-8000
If to the Company, to:
Financial Performance Corporation
335 Madison Avenue, 8th Floor
New York, New York 10017
Attention: President
Telephone: (212) 557-0401
Fax: (212) 557-0490
- 9 -
<PAGE> 10
With a copy to:
Baer Marks & Upham LLP
805 Third Avenue
New York, New York ____
Attention: Jonathan J. Russo
Telephone: (212) 702-5714
Fax: (212) 702-5941
All notices are effective upon receipt or upon refusal if properly delivered.
7.5 Severability. If any term, provision, covenant or
condition of this Agreement or part thereof, or the application thereof to any
Person, place or circumstance shall be held to be invalid, unenforceable or void
by a court of competent jurisdiction, the remainder of this Agreement and such
term, provision, covenant or condition shall remain in full force and effect,
and any such invalid, unenforceable or void term, provision, covenant or
condition shall be deemed, without further action on the part of the parties
hereto, modified, amended and limited, and the court shall have the power to
modify, amend, and limit such term, provision, covenant or condition, to the
extent necessary to render the same and the remainder of this Agreement valid,
enforceable and lawful.
7.6 Binding Effect, Assignment. This Agreement shall be
binding upon and inure to the benefit of the parties and their respective
permitted successors and assigns. Nothing in this Agreement shall create or be
deemed to create any third party beneficiary rights or any other rights of any
kind in any Person or entity not a party to this Agreement except as provided
below. No assignment of this Agreement or of any rights or obligations hereunder
may be made by Trump (by operation of law or otherwise) without the prior
written consent of the Purchaser, except as provided herein, and any attempted
assignment without such required consent shall be void. The Purchaser may assign
this Agreement and any or all rights and obligations hereunder, in whole or in
part, to any Affiliate of the Purchaser or any purchaser of not less than
500,000 shares of Common Stock owned by the Purchaser, whether direct or
indirect, by purchase, merger, consolidation, operation of law or otherwise (any
such Affiliate or purchaser, a "Successor"). The Purchaser will require any such
Successor to expressly assume and agree to perform this Agreement in the same
manner and to the same extent that the Purchaser would be required to perform it
if no such purchase, or succession had taken place. Upon any such permitted
purchase or succession the references in this Agreement to the Purchaser shall
also apply to any Successor unless the context otherwise requires.
7.7 Public Announcement. The parties shall cooperate with
respect to any public announcement relating to the transactions contemplated
hereby or by the other Transaction Documents; and none of the parties will issue
any public statement announcing such transaction without the prior consent of
the others (which shall not be unreasonably withheld, delayed or conditioned),
except as such party in good faith (based upon advice of counsel) believes is
required by law and following notice to the other parties. If within three (3)
Business Days after such notice to the other parties has been given, neither
other party responds, their consents shall be deemed given.
- 10 -
<PAGE> 11
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed as of the date first written above.
-----------------------------------
ROBERT S. TRUMP
-----------------------------------
RONALD NASH
FINANCIAL PERFORMANCE CORPORATION
By:
-------------------------------
Name:
Title:
- 11 -
<PAGE> 12
SCHEDULE 3.2
to
Stock Purchase and Sale Agreement
1. Filings under Section 13 of the Securities Exchange Act of 1934, as amended.
2. Filings under Section 16 of the Securities Exchange Act of 1934, as amended.
3. Prospectus delivery requirements pursuant to the Securities Act of 1933, as
amended.
- 12 -
<PAGE> 13
SCHEDULE 3.3
to
Stock Purchase and Sale Agreement
None
- 13 -
<PAGE> 14
SCHEDULE 4.3
to
Stock Purchase and Sale Agreement
1. Restated and Amended Managing Directors Agreement dated November 16,
1999 between MKP and Susan Michaelson.
2. Restated and Amended Managing Directors Agreement dated November 16,
1999 between MKP and Hillary Kelbick.
3. First Amendment to Restated and Amended Shareholders Agreement by and
among MKP, Financial Performance Corporation, Susan Michaelson and
Hillary Kelbick dated November 16, 1999.
- 14 -
<PAGE> 15
SCHEDULE 4.4
to
Stock Purchase and Sale Agreement
SCHEDULE OF WARRANT HOLDERS
FINANCIAL PERFORMANCE CORPORATION
DATE: November 12, 1999
1. Warrants dated September 15, 1995 (exercisable at $0.50/share until
9-15-2010)
<TABLE>
<CAPTION>
Holder No. of Warrants
------ ---------------
<S> <C>
William F. Finley 200,000
</TABLE>
2. Warrants dated September 15, 1996 (exercisable at $1.00/share until
9-15-2006)
<TABLE>
<CAPTION>
Holder No. of Warrants
------ ---------------
<S> <C>
William F. Finley 200,000
Susan Michaelson 200,000
Hillary Kelbick 200,000
Richard Levy 50,000
Duncan G. Burke 50,000
Phillip L. Hage 25,000
</TABLE>
3. Warrants dated September 16, 1996 (exercisable at $1.00/share until
9-15-2006)
<TABLE>
<CAPTION>
Holder No. of Warrants
------ ---------------
<S> <C>
Nora Byrne 5,000
Siobhan Glennon 5,000
Debra Kruper 5,000
Pamela Reich 5,000
</TABLE>
4. Warrants dated December 1, 1996 (exercisable at $0.50/share until
11-30-1999)
<TABLE>
<CAPTION>
Holder No. of Warrants
------ ---------------
<S> <C>
Van Kasper & Company 150,000
</TABLE>
- 15 -
<PAGE> 16
5. Warrants dated December 29, 1997 (exercisable at $0.50/share until
11-30-1999)*
<TABLE>
<CAPTION>
Holder No. of Warrants
------ ---------------
<S> <C>
Richard Levy 50,000
Duncan G. Burke 50,000
</TABLE>
6. Warrants dated October 21, 1998 (exercisable at $0.50/share until
10-31-2001)*
<TABLE>
<CAPTION>
Holder No. of Warrants
------ ---------------
<S> <C>
Richard Levy 100,000
Duncan G. Burke 100,000
Ottavio Serena 200,000
Gary S. Friedman 50,000
Charlotte Tuck 50,000
</TABLE>
* Warrant expiration date extended until November 30, 2004.
- 16 -
<PAGE> 17
SCHEDULE 5.2
to
Stock Purchase and Sale Agreement
1. Filings under Section 13 of the Securities Exchange Act of 1934, as amended.
2. Filings under Section 16 of the Securities Exchange Act of 1934, as amended.
- 17 -
<PAGE> 1
EXHIBIT 10.3
STOCKHOLDERS AGREEMENT
DATED AS OF NOVEMBER 17, 1999
among
ROBERT S. TRUMP,
JEFFREY S. SILVERMAN,
RONALD NASH
and
FINANCIAL PERFORMANCE
CORPORATION
<PAGE> 2
STOCKHOLDERS AGREEMENT
THIS STOCKHOLDERS AGREEMENT (the "AGREEMENT") is entered into as of
November 17, 1999 by and among Robert S. Trump ("TRUMP"), Jeffrey S. Silverman
("SILVERMAN"), Ronald Nash ("NASH") and Financial Performance Corporation, a New
York corporation (the "COMPANY"). Each of the parties to this Agreement (other
than the Company) and any other individual, corporation, partnership, trust,
unincorporated organization or other entity (a "PERSON") who shall become a
party to or agree to be bound by the terms of this Agreement after the date
hereof is sometimes hereinafter referred to as a "STOCKHOLDER".
RECITALS
Concurrently with the execution of this Agreement, Silverman and Trump
will consummate the transactions contemplated by that certain Stock Purchase and
Sale Agreement dated as of November 17, 1999 among the Company, Silverman and
Trump (the "SILVERMAN PURCHASE AGREEMENT").
Concurrently with the execution of this Agreement, Nash and Trump are
consummating the transactions contemplated by that certain Stock Purchase and
Sale Agreement dated as of November 16, 1999 among the Company, Nash and Trump
(the "NASH PURCHASE AGREEMENT" and, together with the Silverman Purchase
Agreement, the "PURCHASE AGREEMENTS").
Following the consummation of the transactions contemplated by the
Purchase Agreements, Silverman will own 500,000 shares of Common Stock, par
value $.01 per share, of the Company (the "COMMON STOCK"), Nash will own 500,000
shares of Common Stock, and Trump will own 4,555,422 shares of Common Stock.
The Stockholders desire, for their mutual benefit and protection, to
enter into this Agreement to set forth their respective rights and obligations
with respect to shares of Common Stock beneficially owned by each of the
Stockholders (whether acquired on the date hereof or hereafter, including all
shares of Common Stock issuable upon the exercise of the Stock Options, warrants
to purchase Common Stock or otherwise.
Capitalized terms used but not defined herein shall have the meanings
ascribed to them in the Silverman Purchase Agreement.
NOW, THEREFORE, in consideration of the foregoing and for other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
ARTICLE 1. Corporate Issues
1.1 Election of Directors.
Simultaneous with the execution and delivery of this Agreement, the
Board of Directors of the Company (the "BOARD OF DIRECTORS") is taking such
action as is necessary to (a) set the number of members of the Board of
Directors at five; (b) appoint Nash to the Board of Directors of the Company
until the next annual meeting of stockholders or until his successor is duly
<PAGE> 3
elected and qualified; and (c) appoint Silverman to the Board of Directors of
the Company until the next annual meeting of stockholders or until his successor
is duly elected and qualified.
The Stockholders agree that so long as Silverman holds more than
500,000 shares of Common Stock, Silverman shall have the right to designate
himself or another individual as a nominee for election as a director of the
Company (the "SILVERMAN DIRECTOR"). The Stockholders agree that so long as Nash
holds more than 500,000 shares of Common Stock, Nash shall have the right to
designate himself or another individual as a nominee for election as a director
of the Company (the "NASH DIRECTOR"). Trump hereby agrees to vote all shares of
Common Stock beneficially owned by him for the Silverman Director and the Nash
Director.
1.2 Fundamental Corporate Actions.
So long as Silverman shall beneficially own at least 500,000 shares of
Common Stock, Trump agrees not to vote his shares in favor of any of the actions
referred to in clauses (i) through (v) of this Section 1.2 without the
affirmative written consent of Silverman.
So long as Nash shall beneficially own at least 500,000 shares of
Common Stock, Trump agrees not to vote his shares in favor of any of the actions
referred to in clauses (i) through (v) of this Section 1.2 without the
affirmative written consent of Nash.
(i) the making, alteration, amendment or repeal of the
Certificate of Incorporation or any part thereof, or the making, alteration,
amendment or repeal of the By-laws or any part thereof, of the Company or any of
its subsidiaries;
(ii) the sale of all or substantially all of the assets of the
Company or any of its subsidiaries in any one transaction or series of related
transactions;
(iii) the merger, consolidation or other business combination
of the Company or any of its subsidiaries with or into any other person or
entity or a statutory share exchange between the Company or any of its
subsidiaries and any other person or entity;
(iv) the liquidation, dissolution or winding up of the Company
or any of its subsidiaries; or
(v) except as otherwise contemplated in this Section 1.2, the
entering into of any contract, agreement or commitment to do, the authorization,
approval, ratification or confirmation of, or the delegation of the power to act
on behalf of the Company or the Board of Directors in respect of, any of the
foregoing.
ARTICLE 2. Restrictions on Transfer
2.1 General Restrictions on Transfer.
Trump hereby agrees that he will not, directly or indirectly, Transfer
any shares of capital stock of the Company (or any interest therein), any stock
certificates representing the same or any voting trust certificate issued with
respect to said capital stock, or any option, right or
-2-
<PAGE> 4
warrant to acquire shares of Common Stock, now or hereafter at any time owned by
him (collectively, the "Remaining Shares"), to any Person (a "Transferee"),
except pursuant to the Stock Option Agreements or as permitted under the
Stockholders Agreement; provided, however, that Trump may Transfer any of the
Remaining Shares to (x) any immediate member of his family, (y) a trust
established for the benefit of any immediate member of his family or (z) any
entity established solely for the purpose of holding title to such shares and
performing Trump's obligations under this Agreement, in each case as long as any
Transferee in clause (x), (y) or (z) assumes and agrees in writing to be bound
by all of the terms of this Agreement; provided, further, that Trump may
Transfer any of the Remaining Shares by pledge or hypothecation if the
Transferee assumes and agrees in writing to be bound by all of the terms of this
Agreement. Notwithstanding the provisos to the prior sentence or anything to the
contrary contained herein, Trump may not Transfer any of the Option Shares which
are subject to a Stock Option Agreement until such Stock Option Agreement has
terminated or expired. For purposes of this Agreement, "Transfer" shall mean
with respect to any capital stock, (i) any sale, assignment or transfer of such
capital stock or any right or interest therein, (ii) any pledge or hypothecation
of such capital stock or any interest therein, (iii) any grant, sale or other
transfer of securities convertible into or exchangeable or exercisable for or
other options, warrants or rights to acquire such capital stock or any interest
therein and (iv) any other direct or indirect transfer of such capital stock or
any interest therein, including by operation of law (it being understood that
any transferee by operation of law shall be required to comply with the
provision of Section 2.1).
Notwithstanding anything to the contrary contained in this Agreement,
there shall be no restrictions hereunder on Trump's right to Transfer, and the
Remaining Shares shall not be deemed to include, (i) 51,000 shares of Common
Stock previously acquired by Trump in open market purchases or (ii) any shares
of Common Stock or any option, right or warrant to acquire shares of Common
Stock, which shall hereafter be acquired by Trump.
2.2 Right of First Offer.
(a) Prior to any Transfer of the Remaining Shares, Trump must first
give written notice of his intent to make such Transfer (a "TRANSFER NOTICE") to
Nash and Silverman setting forth the number of shares of Common Stock (the
"FIRST OFFER SHARES") that Trump desires to transfer and the cash price that
Trump proposes to be paid for such First Offer Shares and the other terms and
conditions of such proposed Transfer.
(b) Trump shall afford Silverman and Nash (each individually a "FIRST
OFFER STOCKHOLDER", and collectively the "FIRST OFFER STOCKHOLDERS") the right,
but not the obligation, to purchase all or part of the First Offer Shares on a
pro rata basis (the "FIRST OFFER OPTION") on the same terms and conditions as
set forth in the Transfer Notice. Notwithstanding anything to the contrary
contained herein, the First Offer Stockholders will not elect to purchase a
portion of the First Offer Shares in an amount less than 10,000 shares if the
number of First Offer Shares is at least 10,000 shares in respect of a
particular Transfer Notice and (ii) if the number of First Offer Shares is at
least 10,000 in respect of a particular Transfer Notice and the First Offer
Stockholders shall elect to purchase part of the First Offer Shares, then each
First Offer Stockholder shall purchase such First Offer Shares in multiples of
1,000 shares.
-3-
<PAGE> 5
The number of shares of Common Stock that each First Offer Stockholder
will be entitled to purchase pursuant to such First Offer Option will be
determined by multiplying (i) the number of shares Trump plans to sell as stated
in the Transfer Notice by (ii) a fraction, the numerator of which shall equal
the number of shares beneficially owned by such First Offer Stockholder as of
the close of business on the day immediately prior to the date the Transfer
Notice is delivered (the "TRANSFER NOTICE DATE") and the denominator of which
shall equal the aggregate number of shares of Common Stock that are beneficially
owned by the First Offer Stockholders as of the close of business on the day
immediately prior to the Transfer Notice Date.
Each First Offer Stockholder shall exercise the First Offer Option by
delivering to Trump irrevocable written notice via facsimile transmission if
reasonably practicable of the First Offer Stockholder's commitment to purchase
all or part of his pro rata share of the First Offer Shares within two business
days after receipt of the Transfer Notice (the "FIRST OFFER OPTION PERIOD").
Failure by either First Offer Stockholder to give such notice within such
two-business-day period shall be deemed an election by such First Offer
Stockholder not to purchase any of the First Offer Shares.
(c) If neither First Offer Stockholder elects to purchase any First
Offer Shares, Trump may Transfer the First Offer Shares in accordance with
Section 2.2(e) below. If one First Offer Stockholder fails to purchase any or
all of his pro rata share of the First Offer Shares and the other First Offer
Stockholder elects to purchase all of his pro rata share of the First Offer
Shares, Trump shall give notice of such failure to such other First Offer
Stockholder. Such notice shall state the number of First Offer Shares remaining
that may be acquired by such First Offer Stockholder, which notice shall be made
by telephone and confirmed in writing within two days. Such First Offer
Stockholder shall have two business days from the date such notice was confirmed
in writing (which confirmation may be by facsimile transmission) to purchase the
remaining First Offer Shares.
(d) Delivery of written notice by a First Offer Stockholder accepting
the First Offer Option pursuant to clauses (b) and (c) above shall constitute a
contract between such First Offer Stockholder, on the one hand, and Trump, on
the other hand, for the purchase and sale of the number of First Offer Shares
specified by such First Offer Stockholder on the terms and conditions set forth
in the Transfer Notice. The purchase of any shares pursuant to the exercise of
the First Offer Option shall be completed not later than 8 business days
following delivery of the Transfer Notice with respect to the First Offer
Shares, subject to receipt of any required material third-party or governmental
approvals, compliance with applicable laws and the absence of any injunction or
similar legal order preventing such transaction.
(e) In the event that the First Offer Stockholders do not elect to
acquire all of the First Option Shares, Trump shall have the right for a period
of 45 days after the termination of the First Offer Option Period to Transfer
the First Offer Shares not so acquired at a price and on terms and conditions no
less favorable to Trump than those set forth in the Transfer Notice or in any
written counter-proposal delivered by a First Offer Stockholder to Trump in
respect of a particular Transfer Notice.
-4-
<PAGE> 6
(f) Subject to the other provisions of this Agreement, this Section 2.2
shall not apply to any Transfer of the Remaining Shares pursuant to the terms of
a merger or statutory share exchange between the Company and a third party or a
liquidation of the Company.
2.3 Payment and Delivery of Shares. At any closing hereunder, (a) the
First Offer Stockholder shall pay the aggregate purchase price for the First
Offer Shares to be purchased, which shall be payable by bank check or by wire
transfer to an account designated by Trump and (b) Trump shall deliver to the
First Offer Stockholder (i) a certificate or certificates representing the First
Offer Shares so purchased registered in the name of the First Offer Stockholder
or his designee or (ii) a certificate or certificates representing the First
Offer Shares so purchased duly endorsed in blank for transfer or accompanied by
appropriate stock powers duly executed in blank. If any of the First Offer
Shares shall be held by Trump in a brokerage account, Trump may deliver to the
brokerage firm in which such First Offer Shares are held written notice to
transfer record and beneficial ownership of the First Offer Shares purchased by
the First Offer Stockholder to the brokerage account of the First Offer
Stockholder. The First Offer Stockholder shall designate his brokerage account
together with the written notice accepting the First Offer Option. The First
Offer Stockholder shall reasonably cooperate with Trump and shall take
reasonable actions requested by Trump to effectuate such transfer of ownership.
However, it shall be solely Trump's obligation to effectuate such transfer of
ownership.
ARTICLE 3. Representations and Warranties
3.1 Representations and Warranties of the Stockholders.
Each of the Stockholders represents and warrants to each other and to
the Company as follows:
3.1.1 Binding Obligation. This Agreement constitutes his
binding obligation, enforceable against him in accordance with its terms, except
insofar as enforceability may be limited by bankruptcy, insolvency, moratorium
or other laws which may affect creditors' rights and remedies generally and by
principles of equity (regardless of whether enforceability is considered in a
proceeding in equity or at law); and
3.1.2 No Conflict. The execution, delivery and performance of
this Agreement by him and the consummation by him of the transactions
contemplated hereby will not, with or without the giving of notice or the lapse
of time, or both, (i) violate any provision of law, statute, rule or regulation
to which he is subject, (ii) violate any order, judgment or decree applicable to
him, or (iii) conflict with, or result in a breach or default under, any term or
condition of its certificate of incorporation, bylaws or equivalent governing
document or any material agreement or other material instrument to which he is a
party or by which he or his property is bound.
3.2 Representations and Warranties of the Company. The Company hereby
represents and warrants to each of the Stockholders as follows:
(a) This Agreement has been duly and validly authorized, executed and
delivered by the Company. This Agreement constitutes the legal, valid and
binding obligation of the Company, enforceable against the Company in accordance
with its terms, subject, as to
-5-
<PAGE> 7
enforceability, to applicable bankruptcy, insolvency, reorganization, moratorium
and similar laws affecting creditors' rights and remedies generally and to
general principles of equity (regardless of whether enforcement is sought in a
proceeding at law or in equity).
(b) The execution and delivery by the Company of this Agreement, the
consummation of the transactions contemplated hereby, and the compliance by the
Company with any of the provisions hereof does and will not (i) conflict with,
violate, result in the breach or termination of, or constitute a default or give
rise to any right of termination or acceleration or right to increase the
obligations or otherwise modify the terms thereof under any contract, permit or
order to which the Company is a party or by which the Company or its properties
or assets are bound; (ii) constitute a violation of any law applicable to the
Company; or (iii) result in the creation of any lien upon the properties or
assets of the Company. No consent, waiver, approval, order, permit or
authorization of, or declaration or filing with, or notification to, any person
or governmental body is required on the part of the Company in connection with
the execution and delivery of this Agreement, or the compliance by the Company,
with any of the provisions hereof, except as set forth in Schedule 4.1 to the
Purchase Agreement.
3.3 Disclaimer. None of the parties to this Agreement makes any
representations or warranties to any of the other parties other than those
expressly set forth herein.
ARTICLE 4. General
4.1 Recapitalization, Exchanges, etc. Affecting the Common Stock. The
provisions of this Agreement shall apply to the full extent set forth herein
with respect to (a) shares of Common Stock and any option, right or warrant to
acquire shares of Common Stock, and (b) any and all shares of capital stock of
the Company or any successor or assign of the Company (whether by merger,
consolidation, sale of assets or otherwise) which may be issued in respect of,
in exchange for, or in substitution for the shares of Common Stock, by
combination, recapitalization, reclassification, merger, consolidation or
otherwise. In the event of any change in the capitalization of the Company, as a
result of any stock split, stock dividend or stock combination, the provisions
of this Agreement shall be appropriately adjusted.
4.2 Injunctive Relief. It is hereby agreed and acknowledged that it
will be impossible to measure in money the damages that would be suffered if the
parties fail to comply with any of the obligations herein imposed on them and
that, in the event of any such failure, an aggrieved party will be irreparably
damaged and will not have an adequate remedy of law. Any such party shall,
therefore, be entitled to injunctive relief, including specific performance, to
enforce such obligations, without the posting of any bond and if any action
should be brought in equity to enforce any of the provisions of this Agreement,
none of the parties hereto shall raise the defense that there is an adequate
remedy at law.
4.3 Notices. All notices and other communications under this Agreement
shall be in writing and shall be deemed given when delivered personally, upon
delivery to a nationally recognized overnight courier service or when mailed by
certified mail, return receipt requested, to a Stockholder or the Company at the
address set forth in the Purchase Agreements (or to such other address as a
party may have specified by notice given to the other parties pursuant to this
provision). All notices are effective upon receipt or upon refusal if properly
delivered.
-6-
<PAGE> 8
4.4 Legend. In addition to any other legend which may be required by
applicable law, each share certificate representing shares of Common Stock
beneficially owned by Trump, which are subject to this Agreement shall have
endorsed, to the extent appropriate, upon its face the following words:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO
RESTRICTIONS ON TRANSFER AS SET FORTH IN THE STOCKHOLDERS
AGREEMENT, DATED AS OF NOVEMBER 17, 1999 (THE "STOCKHOLDERS
AGREEMENT"), A COPY OF WHICH MAY BE OBTAINED FROM THE
SECRETARY OF FINANCIAL PERFORMANCE CORPORATION AT ITS
PRINCIPAL EXECUTIVE OFFICES. SUCH SECURITIES MAY NOT BE
TRANSFERRED IN ANY WAY EXCEPT IN ACCORDANCE WITH THE
PROVISIONS OF THE STOCKHOLDERS AGREEMENT. THE SECURITIES
REPRESENTED BY THIS CERTIFICATE ARE ALSO SUBJECT TO OTHER
RIGHTS AND OBLIGATIONS AS SET FORTH IN THE STOCKHOLDERS
AGREEMENT.
This legend shall be removed when the shares of Common Stock
represented by such certificate shall no longer be subject to the terms and
conditions of this Agreement.
4.5 Entire Agreement; Amendments and Waivers. This Agreement, together
with the other Transaction Documents, represents the entire understanding and
agreement among the parties hereto with respect to the subject matter hereof and
can be amended, supplemented or changed, and any provision hereof can be waived,
only by written instrument making specific reference to this Agreement signed by
the parties hereto. No action taken pursuant to this Agreement, including
without limitation, any investigation by or on behalf of any party, shall be
deemed to constitute a waiver by the party taking such action of compliance with
any representation, warranty, covenant or agreement contained herein. The waiver
by any party hereto of a breach of any provision of this Agreement shall not
operate or be construed as a further or continuing waiver of such breach or as a
waiver of any other or subsequent breach. No failure on the part of any party to
exercise, and no delay in exercising, any right, power or remedy hereunder shall
operate as a waiver thereof, nor shall any single or partial exercise of such
right, power or remedy by such party preclude any other or further exercise
thereof or the exercise of any other right, power or remedy. All remedies
hereunder are cumulative and are not exclusive of any other remedies provided by
law.
4.6 Additional Documents. The Stockholders agree to execute any and all
further reasonable documents and writings within their respective powers and to
perform such other reasonable actions which may be or become necessary or
expedient to effectuate and carry out this Agreement.
4.7 Binding Effect, Assignment. This Agreement shall be binding upon
and inure to the benefit of the parties and their respective permitted
successors and assigns. Nothing in this Agreement shall create or be deemed to
create any third party beneficiary rights or any other rights of any kind in any
person or entity not a party to this Agreement except as provided below.
-7-
<PAGE> 9
No assignment of this Agreement or of any rights or obligations hereunder may be
made by Trump (by operation of law or otherwise) without the prior written
consent of Silverman and Nash, except as provided herein, and any attempted
assignment without such required consent shall be void. Silverman and Nash may
assign this Agreement and any or all rights and obligations hereunder, in whole
or in part, to any of their respective Affiliates, (any such Affiliate, a
"Successor"). Notwithstanding the foregoing, Silverman and Nash may assign their
respective rights under Section 2.2 of this Agreement in whole but not in part
to any of their respective Affiliates. Silverman or Nash will require any such
Successor to expressly assume and agree to perform this Agreement in the same
manner and to the same extent that Silverman or Nash, as the case may be, would
be required to perform it if no such purchase, or succession had taken place.
Upon any such permitted purchase or succession the references in this Agreement
to the Purchaser shall also apply to any Successor unless the context otherwise
requires.
4.8 Severability. If any term, provision, covenant or condition of this
Agreement or part thereof, or the application thereof to any Person, place or
circumstance shall be held to be invalid, unenforceable or void by a court of
competent jurisdiction, the remainder of this Agreement and such term,
provision, covenant or condition shall remain in full force and effect, and any
such invalid, unenforceable or void term, provision, covenant or condition shall
be deemed, without further action on the part of the parties hereto, modified,
amended and limited, and the court shall have the power to modify, amend, and
limit such term, provision, covenant or condition, to the extent necessary to
render the same and the remainder of this Agreement valid, enforceable and
lawful.
4.9 Governing Law. This Agreement shall be governed by and construed in
accordance with the internal laws of the State of New York without giving effect
to the principles of conflict of laws thereunder.
4.10 Attorneys' Fees. Should any litigation or arbitration be commenced
(including any proceedings in a bankruptcy court) between the parties hereto or
their representatives concerning any provision of this Agreement or the rights
and duties of any person or entity hereunder, the party or parties prevailing in
such proceeding shall be entitled, in addition to such other relief as may be
granted, to the reasonable attorneys' fees and court costs incurred by reason of
such litigation or arbitration.
4.11 Headings. The headings in this Agreement are inserted only as a
matter of convenience, and in no way define, limit, or extend or interpret the
scope of this Agreement or of any particular Section.
4.12 Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
4.13 Submission to Jurisdiction; Waiver of Jury Trial; and Consent to
Service of Process.
(a) The parties hereto hereby irrevocably submit to the
exclusive jurisdiction of any federal or state court located within the State of
New York over any dispute arising out of
-8-
<PAGE> 10
or relating to this Agreement or any of the transactions contemplated hereby or
by the other Transaction Documents and each party hereby irrevocably agrees that
all claims in respect of such dispute or any suit, action or proceeding related
thereto may be heard and determined in such courts. The parties hereby
irrevocably waive, to the fullest extent permitted by applicable law, any
objection which they may now or hereafter have to the laying of venue of any
such dispute brought in such court or any defense of inconvenient forum for the
maintenance of such dispute. Each of the parties hereto agrees that a judgment
in any such dispute may be enforced in other jurisdictions by suit on the
judgment or in any other manner provided by law.
(b) THE PARTIES HEREBY KNOWINGLY, VOLUNTARILY AND
INTENTIONALLY WAIVE THE RIGHT ANY OF THEM MAY HAVE TO A TRIAL BY JURY IN RESPECT
OF ANY LITIGATION BASED HEREON OR ARISING OUT OF, UNDER OR IN CONNECTION WITH
THIS AGREEMENT AND ANY OF THE OTHER TRANSACTION DOCUMENTS, OR ANY COURSE OF
CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF
ANY PARTY. THIS PROVISION IS A MATERIAL INDUCEMENT FOR THE PARTIES' ACCEPTANCE
OF THIS AGREEMENT.
4.14 Binding Effect. This Agreement and all of its provisions, rights
and obligations shall be binding upon and shall inure to the benefit of the
parties hereto and their respective permitted successors, heirs and legal
representatives and to permitted Transferees of shares owned by the
Stockholders. Any Transfer of shares, in addition to any other requirements
herein, shall be subject to receipt by the Stockholders and the Company of an
executed agreement by such Transferee agreeing to become bound by the terms of
this Agreement.
-9-
<PAGE> 11
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year first set forth above.
FINANCIAL PERFORMANCE CORPORATION
By:__________________________
Name:
Title:
__________________________
ROBERT S. TRUMP
__________________________
JEFFREY S. SILVERMAN
__________________________
RONALD NASH
-10-
<PAGE> 1
EXHIBIT 10.4
OPTION AGREEMENT
OPTION AGREEMENT, dated November 17, 1999 (this "Agreement"), by and
between Jeffrey S. Silverman (the "Optionholder") and Robert S. Trump (the
"Shareholder").
WITNESSETH
The Optionholder and the Shareholder are each party to a Stock
Purchase Agreement, dated as of the date hereof (the "Purchase Agreement";
capitalized terms used but not defined herein have the meanings set forth in the
Purchase Agreement), providing for, among other things, the Optionholder's
acquisition of 500,000 shares of Common Stock, par value $.01 per share (the
"Common Stock"), of Financial Performance Corporation, a New York corporation
(the "Company").
As a condition and inducement to the Optionholder's
willingness to enter into the Purchase Agreement, the Optionholder has requested
that the Shareholder agree, and the Shareholder has agreed, to grant the
Optionholder the Option (as defined below).
NOW, THEREFORE, in consideration of the promises and mutual
covenants and agreements hereinafter contained, the parties hereto, intending to
be legally bound, hereby agree as follows:
1. Grant of Option.
(a) Subject to and upon the terms and conditions set forth in
this Agreement, the Shareholder hereby grants an irrevocable option (the
"Option") to the Optionholder to purchase up to 500,000 shares (the "Shares") of
Common Stock of the Company owned, beneficially and of record, by the
Shareholder, at a purchase price of $.8125 per Share.
(b) The Option may be partially exercised from time to time in
denominations of 50,000 shares or more in any one instance. The Option may not
be exercised in part more than six times in a calendar year.
(c) The Option shall expire and cease to be exercisable two
years after the date of this Agreement (November 17, 2001) (the "Termination
Date").
2. Method of Exercise. (a) The Option or any part thereof may
be exercised by the giving of a written notice to the Shareholder (each an
"Exercise Notice") executed by or on behalf of the Optionholder, to the
Shareholder at the address set forth in Section 5.4 of the Purchase Agreement,
which Exercise Notice shall state the election to exercise the Option, the
number of whole Shares with respect to which the Option is being exercised and
the place (in New York City) and date for the closing of the purchase; provided
that such date shall be not earlier than three business days nor later than
fifteen business days from the date such notice is given, and provided, further,
that if such purchase cannot be consummated during
<PAGE> 2
such fifteen business day period due to any law or regulation, the date for the
closing of such purchase shall be within five business days following the
cessation of such restriction on consummation.
3. Payment and Delivery of Shares. At any closing hereunder,
(a) the Optionholder shall pay the aggregate purchase price for the Shares to be
purchased, which shall be payable by bank check or by wire transfer to an
account designated by Trump, and (b) the Shareholder shall deliver to the
Optionholder (i) a certificate or certificates representing the Shares so
purchased registered in the name of the Optionholder or his designee or (ii) a
certificate or certificates representing the Shares so purchased duly endorsed
in blank for transfer or accompanied by appropriate stock powers duly executed
in blank. If any of the Shares shall be held by Trump in a brokerage account,
Trump may deliver to the brokerage firm in which such Shares are held, written
notice to transfer record and beneficial ownership of the Shares purchased by
the Optionholder to the brokerage account of the Optionholder. The Optionholder
shall designate his brokerage account together with the Exercise Notice. The
Optionholder shall reasonably cooperate with Trump and shall take reasonable
actions requested by Trump to effectuate such transfer of ownership.
However it shall be solely Trump's obligation to effectuate such transfer of
ownership.
4. Representations and Warranties of the Shareholder.
(a) The representations and warranties of the Shareholder
contained in Section 3 of the Purchase Agreement are hereby incorporated by
reference herein in full with the same force and effect as though expressly made
as part of this Agreement.
(b) Prior to the Termination Date, the Shareholder will not
take, and will not permit anyone else to take, any action which might have the
effect of preventing or disabling the Shareholder from delivering the Shares
(free and clear of any liens, claims, security interests, or encumbrances
whatsoever) to the Optionholder upon exercise of the Option or from otherwise
performing its obligations under this Agreement.
4A. Representations and Warranties of the Optionholder. The
representations and warranties of the Optionholder contained in Section 5 of the
Purchase Agreement are hereby incorporated by reference herein in full with the
same force and effect as though expressly made as part of this Agreement.
5. Adjustments. (a) In case the Company shall at any time
after the date of this Agreement (i) declare a dividend or make a distribution
on the Common Stock in shares of its capital stock, (ii) subdivide the
outstanding Common Stock; (iii) combine the outstanding Common Stock into a
smaller number of shares or (iv) issue any shares of its capital stock by
reclassification of the Common Stock (including any such reclassification in
connection with a consolidation or merger in which the Company is the continuing
corporation), or take any action similar to (i) through (iv), then the number
and kind of shares of capital stock purchasable upon exercise of the Option
immediately after the happening of such event shall be adjusted so that, after
giving effect to such adjustment, the Optionholder shall be entitled to receive
the number and kind of shares of capital stock upon exercise that such holder
would have owned or been
-2-
<PAGE> 3
entitled to receive had such Option been exercised immediately prior to the
happening of the events described above (or in the case of clause (i) above,
immediately prior to the record date therefor). An adjustment made pursuant to
this Section 5(a) shall become effective immediately after the effective date,
retroactive to the record date therefor in the case of clause (i) above, and
shall become effective immediately after the effective date in the case of
clauses (ii), (iii) or (iv) above.
(b) In case of any consolidation or merger of the Company with
or into another corporation (other than a merger with a subsidiary in which the
Company is the continuing corporation and which does not result in any
reclassification, capital reorganization or other change of the outstanding
Shares issuable upon exercise of the Option) or in case of the sale, transfer or
other disposition of all or substantially all of the assets of the Company, then
the Optionholder shall be entitled to receive upon exercise of the Option such
number of shares of capital stock or other securities or property upon, or as a
result of, such transaction that the Optionholder would have been entitled to
receive had the Option been exercised immediately prior to such transaction.
6. Specific Performance. The Shareholder acknowledges and
agrees that the breach or threatened breach of this Agreement would cause
irreparable damage to the Optionholder and that the Optionholder will not have
an adequate remedy at law. Accordingly, the Shareholder expressly acknowledges
that the Optionholder shall be entitled to specific performance, injunctive
relief or any other equitable remedy against the Shareholder, in the event of
any breach or threatened breach of any provision of this Agreement by the
Shareholder. The rights and remedies of the parties hereto are cumulative and
shall not be exclusive, and each such party shall be entitled to pursue all
legal and equitable rights and remedies and to secure performance of the
obligations and duties of the other under this Agreement, and the enforcement of
one or more of such rights and remedies by a party shall in no way preclude such
party from pursuing, at the same time or subsequently, any and all other rights
and remedies available to it.
7. Further Assurances. The Shareholder and the Optionholder
each agree to execute and deliver such other reasonable documents or agreements
as may be necessary or desirable for the implementation of this Agreement and
the consummation of the transactions contemplated hereby.
8. Submission to Jurisdiction; Waiver of Jury Trial; and
Consent to Service of Process.
(a) The parties hereto hereby irrevocably submit to the
exclusive jurisdiction of any federal or state court located within the State of
New York over any dispute arising out of or relating to this Agreement or any of
the transactions contemplated hereby or by the other Transaction Documents and
each party hereby irrevocably agrees that all claims in respect of such dispute
or any suit, action or proceeding related thereto may be heard and determined in
such courts. The parties hereby irrevocably waive, to the fullest extent
permitted by applicable law, any objection which they may now or hereafter have
to the laying of venue of any such dispute brought in such court or any defense
of inconvenient forum for the maintenance of such
-3-
<PAGE> 4
dispute. Each of the parties hereto agrees that a judgment in any such dispute
may be enforced in other jurisdictions by suit on the judgment or in any other
manner provided by law.
(b) THE PARTIES HEREBY KNOWINGLY, VOLUNTARILY AND
INTENTIONALLY WAIVE THE RIGHT ANY OF THEM MAY HAVE TO A TRIAL BY JURY IN RESPECT
OF ANY LITIGATION BASED HEREON OR ARISING OUT OF, UNDER OR IN CONNECTION WITH
THIS AGREEMENT AND ANY OF THE OTHER TRANSACTION DOCUMENTS, OR ANY COURSE OF
CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF
ANY PARTY.THIS PROVISION IS A MATERIAL INDUCEMENT FOR THE PARTIES' ACCEPTANCE OF
THIS AGREEMENT.
9. Entire Agreement; Amendments and Waivers. This Agreement,
together with the other Transaction Documents, represents the entire
understanding and agreement between the parties hereto with respect to the
subject matter hereof and can be amended, supplemented or changed, and any
provision hereof can be waived, only by written instrument making specific
reference to this Agreement signed by the parties hereto. No action taken
pursuant to this Agreement, including without limitation, any investigation by
or on behalf of any party, shall be deemed to constitute a waiver by the party
taking such action of compliance with any representation, warranty, covenant or
agreement contained herein. The waiver by any party hereto of a breach of any
provision of this Agreement shall not operate or be construed as a further or
continuing waiver of such breach or as a waiver of any other or subsequent
breach. No failure on the part of any party to exercise, and no delay in
exercising, any right, power or remedy hereunder shall operate as a waiver
thereof, nor shall any single or partial exercise of such right, power or remedy
by such party preclude any other or further exercise thereof or the exercise of
any other right, power or remedy. All remedies hereunder are cumulative and are
not exclusive of any other remedies provided by law.
10. Governing Law. This Agreement shall be governed by and
construed in accordance with the internal laws of the State of New York without
giving effect to the principles of conflict of laws thereunder.
11. Notices. All notices and other communications under this
Agreement shall be in writing and shall be deemed given when delivered in the
manner and at the addresses set forth in Section 5.4 of the Purchase Agreement.
12. Severability. If any term, provision, covenant or
condition of this Agreement or part thereof, or the application thereof to any
Person, place or circumstance shall be held to be invalid, unenforceable or void
by a court of competent jurisdiction, the remainder of this Agreement and such
term, provision, covenant or condition shall remain in full force and effect,
and any such invalid, unenforceable or void term, provision, covenant or
condition shall be deemed, without further action on the part of the parties
hereto, modified, amended and limited, and the court shall have the power to
modify, amend, and limit such term, provision, covenant or condition, to the
extent necessary to render the same and the remainder of this Agreement valid,
enforceable and lawful.
-4-
<PAGE> 5
13. Binding Effect, Assignment. This Agreement shall be
binding upon and inure to the benefit of the parties and their respective
permitted successors and assigns. Nothing in this Agreement shall create or be
deemed to create any third party beneficiary rights or any other rights of any
kind in any Person or entity not a party to this Agreement except as provided
below. No assignment of this Agreement or of any rights or obligations hereunder
may be made by the Shareholder (by operation of law or otherwise) without the
prior written consent of the Optionholder and any attempted assignment without
such required consent shall be void. The Optionholder may assign this Agreement
and any or all rights and obligations hereunder, in whole or in part, to any
Affiliate of the Optionholder or any purchaser of the Option, whether direct or
indirect, by purchase, merger, consolidation, operation of law or otherwise (any
such Affiliate or purchaser, a "Successor"). Upon any such permitted purchase or
succession the references in this Agreement to the Optionholder shall also apply
to any Successor unless the context otherwise requires.
-5-
<PAGE> 6
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed as of the date first written above.
----------------------------
Robert S. Trump
----------------------------
Jeffrey S. Silverman
-6-
<PAGE> 1
Exhibit 10.5
OPTION AGREEMENT
OPTION AGREEMENT, dated November 17, 1999 (this "Agreement"), by and
between Jeffrey S. Silverman (the "Optionholder") and Robert S. Trump (the
"Shareholder").
WITNESSETH
The Optionholder and the Shareholder are each party to a Stock
Purchase Agreement, dated as of the date hereof (the "Purchase Agreement";
capitalized terms used but not defined herein have the meanings set forth in the
Purchase Agreement), providing for, among other things, the Optionholder's
acquisition of 500,000 shares of Common Stock, par value $.01 per share (the
"Common Stock"), of Financial Performance Corporation, a New York corporation
(the "Company").
As a condition and inducement to the Optionholder's
willingness to enter into the Purchase Agreement, the Optionholder has requested
that the Shareholder agree, and the Shareholder has agreed, to grant the
Optionholder the Option (as defined below).
NOW, THEREFORE, in consideration of the promises and mutual
covenants and agreements hereinafter contained, the parties hereto, intending to
be legally bound, hereby agree as follows:
1. Grant of Option.
(a) Subject to and upon the terms and conditions set forth in
this Agreement, the Shareholder hereby grants an irrevocable option (the
"Option") to the Optionholder to purchase up to 500,000 shares (the "Shares") of
Common Stock of the Company owned, beneficially and of record, by the
Shareholder, at a purchase price of $1.3125 per Share.
(b) The Option may be partially exercised from time to time in
denominations of 50,000 shares or more in any one instance. The Option may not
be exercised in part more than six times in a calendar year.
(c) The Option shall expire and cease to be exercisable three
years after the date of this Agreement (November 17, 2002) (the "Termination
Date").
2. Method of Exercise. (a) The Option or any part thereof may
be exercised by the giving of a written notice to the Shareholder (each an
"Exercise Notice") executed by or on behalf of the Optionholder, to the
Shareholder at the address set forth in Section 5.4 of the Purchase Agreement,
which Exercise Notice shall state the election to exercise the Option, the
number of whole Shares with respect to which the Option is being exercised and
the place (in New York City) and date for the closing of the purchase; provided
that such date shall be not earlier than three business days nor later than
fifteen business days from the date such notice is given, and provided, further,
that if such purchase cannot be consummated during
<PAGE> 2
such fifteen business day period due to any law or regulation, the date for the
closing of such purchase shall be within five business days following the
cessation of such restriction on consummation.
3. Payment and Delivery of Shares. At any closing hereunder,
(a) the Optionholder shall pay the aggregate purchase price for the Shares to be
purchased, which shall be payable by bank check or by wire transfer to an
account designated by Trump, and (b) the Shareholder shall deliver to the
Optionholder (i) a certificate or certificates representing the Shares so
purchased registered in the name of the Optionholder or his designee or (ii) a
certificate or certificates representing the Shares so purchased duly endorsed
in blank for transfer or accompanied by appropriate stock powers duly executed
in blank. If any of the Shares shall be held by Trump in a brokerage account,
Trump may deliver to the brokerage firm in which such Shares are held, written
notice to transfer record and beneficial ownership of the Shares purchased by
the Optionholder to the brokerage account of the Optionholder. The Optionholder
shall designate his brokerage account together with the Exercise Notice. The
Optionholder shall reasonably cooperate with Trump and shall take reasonable
actions requested by Trump to effectuate such transfer of ownership. However it
shall be solely Trump's obligation to effectuate such transfer of ownership.
4. Representations and Warranties of the Shareholder.
(a) The representations and warranties of the Shareholder
contained in Section 3 of the Purchase Agreement are hereby incorporated by
reference herein in full with the same force and effect as though expressly made
as part of this Agreement.
(b) Prior to the Termination Date, the Shareholder will not
take, and will not permit anyone else to take, any action which might have the
effect of preventing or disabling the Shareholder from delivering the Shares
(free and clear of any liens, claims, security interests, or encumbrances
whatsoever) to the Optionholder upon exercise of the Option or from otherwise
performing its obligations under this Agreement.
4A. Representations and Warranties of the Optionholder. The
representations and warranties of the Optionholder contained in Section 5 of the
Purchase Agreement are hereby incorporated by reference herein in full with the
same force and effect as though expressly made as part of this Agreement.
5. Adjustments. (a) In case the Company shall at any time
after the date of this Agreement (i) declare a dividend or make a distribution
on the Common Stock in shares of its capital stock, (ii) subdivide the
outstanding Common Stock; (iii) combine the outstanding Common Stock into a
smaller number of shares or (iv) issue any shares of its capital stock by
reclassification of the Common Stock (including any such reclassification in
connection with a consolidation or merger in which the Company is the continuing
corporation), or take any action similar to (i) through (iv), then the number
and kind of shares of capital stock purchasable upon exercise of the Option
immediately after the happening of such event shall be adjusted so that, after
giving effect to such adjustment, the Optionholder shall be entitled to receive
the number and kind of shares of capital stock upon exercise that such holder
would have owned or been
- 2 -
<PAGE> 3
entitled to receive had such Option been exercised immediately prior to the
happening of the events described above (or in the case of clause (i) above,
immediately prior to the record date therefor). An adjustment made pursuant to
this Section 5(a) shall become effective immediately after the effective date,
retroactive to the record date therefor in the case of clause (i) above, and
shall become effective immediately after the effective date in the case of
clauses (ii), (iii) or (iv) above.
(b) In case of any consolidation or merger of the Company with
or into another corporation (other than a merger with a subsidiary in which the
Company is the continuing corporation and which does not result in any
reclassification, capital reorganization or other change of the outstanding
Shares issuable upon exercise of the Option) or in case of the sale, transfer or
other disposition of all or substantially all of the assets of the Company, then
the Optionholder shall be entitled to receive upon exercise of the Option such
number of shares of capital stock or other securities or property upon, or as a
result of, such transaction that the Optionholder would have been entitled to
receive had the Option been exercised immediately prior to such transaction.
6. Specific Performance. The Shareholder acknowledges and
agrees that the breach or threatened breach of this Agreement would cause
irreparable damage to the Optionholder and that the Optionholder will not have
an adequate remedy at law. Accordingly, the Shareholder expressly acknowledges
that the Optionholder shall be entitled to specific performance, injunctive
relief or any other equitable remedy against the Shareholder, in the event of
any breach or threatened breach of any provision of this Agreement by the
Shareholder. The rights and remedies of the parties hereto are cumulative and
shall not be exclusive, and each such party shall be entitled to pursue all
legal and equitable rights and remedies and to secure performance of the
obligations and duties of the other under this Agreement, and the enforcement of
one or more of such rights and remedies by a party shall in no way preclude such
party from pursuing, at the same time or subsequently, any and all other rights
and remedies available to it.
7. Further Assurances. The Shareholder and the Optionholder
each agree to execute and deliver such other reasonable documents or agreements
as may be necessary or desirable for the implementation of this Agreement and
the consummation of the transactions contemplated hereby.
8. Submission to Jurisdiction; Waiver of Jury Trial; and
Consent to Service of Process.
(a) The parties hereto hereby irrevocably submit to the
exclusive jurisdiction of any federal or state court located within the State of
New York over any dispute arising out of or relating to this Agreement or any of
the transactions contemplated hereby or by the other Transaction Documents and
each party hereby irrevocably agrees that all claims in respect of such dispute
or any suit, action or proceeding related thereto may be heard and determined in
such courts. The parties hereby irrevocably waive, to the fullest extent
permitted by applicable law, any objection which they may now or hereafter have
to the laying of venue of any such dispute brought in such court or any defense
of inconvenient forum for the maintenance of such
- 3 -
<PAGE> 4
dispute. Each of the parties hereto agrees that a judgment in any such dispute
may be enforced in other jurisdictions by suit on the judgment or in any other
manner provided by law.
(b) THE PARTIES HEREBY KNOWINGLY, VOLUNTARILY AND
INTENTIONALLY WAIVE THE RIGHT ANY OF THEM MAY HAVE TO A TRIAL BY JURY IN RESPECT
OF ANY LITIGATION BASED HEREON OR ARISING OUT OF, UNDER OR IN CONNECTION WITH
THIS AGREEMENT AND ANY OF THE OTHER TRANSACTION DOCUMENTS, OR ANY COURSE OF
CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF
ANY PARTY. THIS PROVISION IS A MATERIAL INDUCEMENT FOR THE PARTIES' ACCEPTANCE
OF THIS AGREEMENT.
9. Entire Agreement; Amendments and Waivers. This Agreement,
together with the other Transaction Documents, represents the entire
understanding and agreement between the parties hereto with respect to the
subject matter hereof and can be amended, supplemented or changed, and any
provision hereof can be waived, only by written instrument making specific
reference to this Agreement signed by the parties hereto. No action taken
pursuant to this Agreement, including without limitation, any investigation by
or on behalf of any party, shall be deemed to constitute a waiver by the party
taking such action of compliance with any representation, warranty, covenant or
agreement contained herein. The waiver by any party hereto of a breach of any
provision of this Agreement shall not operate or be construed as a further or
continuing waiver of such breach or as a waiver of any other or subsequent
breach. No failure on the part of any party to exercise, and no delay in
exercising, any right, power or remedy hereunder shall operate as a waiver
thereof, nor shall any single or partial exercise of such right, power or remedy
by such party preclude any other or further exercise thereof or the exercise of
any other right, power or remedy. All remedies hereunder are cumulative and are
not exclusive of any other remedies provided by law.
10. Governing Law. This Agreement shall be governed by and
construed in accordance with the internal laws of the State of New York without
giving effect to the principles of conflict of laws thereunder.
11. Notices. All notices and other communications under this
Agreement shall be in writing and shall be deemed given when delivered in the
manner and at the addresses set forth in Section 5.4 of the Purchase Agreement.
12. Severability. If any term, provision, covenant or
condition of this Agreement or part thereof, or the application thereof to any
Person, place or circumstance shall be held to be invalid, unenforceable or void
by a court of competent jurisdiction, the remainder of this Agreement and such
term, provision, covenant or condition shall remain in full force and effect,
and any such invalid, unenforceable or void term, provision, covenant or
condition shall be deemed, without further action on the part of the parties
hereto, modified, amended and limited, and the court shall have the power to
modify, amend, and limit such term, provision, covenant or condition, to the
extent necessary to render the same and the remainder of this Agreement valid,
enforceable and lawful.
- 4 -
<PAGE> 5
13. Binding Effect, Assignment. This Agreement shall be
binding upon and inure to the benefit of the parties and their respective
permitted successors and assigns. Nothing in this Agreement shall create or be
deemed to create any third party beneficiary rights or any other rights of any
kind in any Person or entity not a party to this Agreement except as provided
below. No assignment of this Agreement or of any rights or obligations hereunder
may be made by the Shareholder (by operation of law or otherwise) without the
prior written consent of the Optionholder and any attempted assignment without
such required consent shall be void. The Optionholder may assign this Agreement
and any or all rights and obligations hereunder, in whole or in part, to any
Affiliate of the Optionholder or any purchaser of the Option, whether direct or
indirect, by purchase, merger, consolidation, operation of law or otherwise (any
such Affiliate or purchaser, a "Successor"). Upon any such permitted purchase or
succession the references in this Agreement to the Optionholder shall also apply
to any Successor unless the context otherwise requires.
- 5 -
<PAGE> 6
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed as of the date first written above.
----------------------------
Robert S. Trump
----------------------------
Jeffrey S. Silverman
- 6 -
<PAGE> 1
Exhibit 10.6
OPTION AGREEMENT
OPTION AGREEMENT, dated November 17, 1999 (this "Agreement"), by and
between Jeffrey S. Silverman (the "Optionholder") and Robert S. Trump (the
"Shareholder").
WITNESSETH
The Optionholder and the Shareholder are each party to a Stock
Purchase Agreement, dated as of the date hereof (the "Purchase Agreement";
capitalized terms used but not defined herein have the meanings set forth in the
Purchase Agreement), providing for, among other things, the Optionholder's
acquisition of 250,000 shares of Common Stock, par value $.01 per share (the
"Common Stock"), of Financial Performance Corporation, a New York corporation
(the "Company").
As a condition and inducement to the Optionholder's
willingness to enter into the Purchase Agreement, the Optionholder has requested
that the Shareholder agree, and the Shareholder has agreed, to grant the
Optionholder the Option (as defined below).
NOW, THEREFORE, in consideration of the promises and mutual
covenants and agreements hereinafter contained, the parties hereto, intending to
be legally bound, hereby agree as follows:
1. Grant of Option.
(a) Subject to and upon the terms and conditions set forth in
this Agreement, the Shareholder hereby grants an irrevocable option (the
"Option") to the Optionholder to purchase up to 250,000 shares (the "Shares") of
Common Stock of the Company owned, beneficially and of record, by the
Shareholder, at a purchase price of $5.00 per Share.
(b) The Option may be partially exercised from time to time in
denominations of 50,000 shares or more in any one instance. The Option may not
be exercised in part more than six times in a calendar year.
(c) The Option shall expire and cease to be exercisable three
years after the date of this Agreement (November 17, 2002) (the "Termination
Date").
2. Method of Exercise. (a) The Option or any part thereof may
be exercised by the giving of a written notice to the Shareholder (each an
"Exercise Notice") executed by or on behalf of the Optionholder, to the
Shareholder at the address set forth in Section 5.4 of the Purchase Agreement,
which Exercise Notice shall state the election to exercise the Option, the
number of whole Shares with respect to which the Option is being exercised and
the place (in New York City) and date for the closing of the purchase; provided
that such date shall be not earlier than three business days nor later than
fifteen business days from the date such notice is given, and provided, further,
that if such purchase cannot be consummated during
<PAGE> 2
such fifteen business day period due to any law or regulation, the date for the
closing of such purchase shall be within five business days following the
cessation of such restriction on consummation.
3. Payment and Delivery of Shares. At any closing hereunder,
(a) the Optionholder shall pay the aggregate purchase price for the Shares to be
purchased, which shall be payable by bank check or by wire transfer to an
account designated by Trump, and (b) the Shareholder shall deliver to the
Optionholder (i) a certificate or certificates representing the Shares so
purchased registered in the name of the Optionholder or his designee or (ii) a
certificate or certificates representing the Shares so purchased duly endorsed
in blank for transfer or accompanied by appropriate stock powers duly executed
in blank. If any of the Shares shall be held by Trump in a brokerage account,
Trump may deliver to the brokerage firm in which such Shares are held, written
notice to transfer record and beneficial ownership of the Shares purchased by
the Optionholder to the brokerage account of the Optionholder. The Optionholder
shall designate his brokerage account together with the Exercise Notice. The
Optionholder shall reasonably cooperate with Trump and shall take reasonable
actions requested by Trump to effectuate such transfer of ownership. However it
shall be solely Trump's obligation to effectuate such transfer of ownership.
4. Representations and Warranties of the Shareholder.
(a) The representations and warranties of the Shareholder
contained in Section 3 of the Purchase Agreement are hereby incorporated by
reference herein in full with the same force and effect as though expressly made
as part of this Agreement.
(b) Prior to the Termination Date, the Shareholder will not
take, and will not permit anyone else to take, any action which might have the
effect of preventing or disabling the Shareholder from delivering the Shares
(free and clear of any liens, claims, security interests, or encumbrances
whatsoever) to the Optionholder upon exercise of the Option or from otherwise
performing its obligations under this Agreement.
4A. Representations and Warranties of the Optionholder. The
representations and warranties of the Optionholder contained in Section 5 of the
Purchase Agreement are hereby incorporated by reference herein in full with the
same force and effect as though expressly made as part of this Agreement.
5. Adjustments. (a) In case the Company shall at any time
after the date of this Agreement (i) declare a dividend or make a distribution
on the Common Stock in shares of its capital stock, (ii) subdivide the
outstanding Common Stock; (iii) combine the outstanding Common Stock into a
smaller number of shares or (iv) issue any shares of its capital stock by
reclassification of the Common Stock (including any such reclassification in
connection with a consolidation or merger in which the Company is the continuing
corporation), or take any action similar to (i) through (iv), then the number
and kind of shares of capital stock purchasable upon exercise of the Option
immediately after the happening of such event shall be adjusted so that, after
giving effect to such adjustment, the Optionholder shall be entitled to receive
the number and kind of shares of capital stock upon exercise that such holder
would have owned or been
- 2 -
<PAGE> 3
entitled to receive had such Option been exercised immediately prior to the
happening of the events described above (or in the case of clause (i) above,
immediately prior to the record date therefor). An adjustment made pursuant to
this Section 5(a) shall become effective immediately after the effective date,
retroactive to the record date therefor in the case of clause (i) above, and
shall become effective immediately after the effective date in the case of
clauses (ii), (iii) or (iv) above.
(b) In case of any consolidation or merger of the Company with
or into another corporation (other than a merger with a subsidiary in which the
Company is the continuing corporation and which does not result in any
reclassification, capital reorganization or other change of the outstanding
Shares issuable upon exercise of the Option) or in case of the sale, transfer or
other disposition of all or substantially all of the assets of the Company, then
the Optionholder shall be entitled to receive upon exercise of the Option such
number of shares of capital stock or other securities or property upon, or as a
result of, such transaction that the Optionholder would have been entitled to
receive had the Option been exercised immediately prior to such transaction.
6. Specific Performance. The Shareholder acknowledges and
agrees that the breach or threatened breach of this Agreement would cause
irreparable damage to the Optionholder and that the Optionholder will not have
an adequate remedy at law. Accordingly, the Shareholder expressly acknowledges
that the Optionholder shall be entitled to specific performance, injunctive
relief or any other equitable remedy against the Shareholder, in the event of
any breach or threatened breach of any provision of this Agreement by the
Shareholder. The rights and remedies of the parties hereto are cumulative and
shall not be exclusive, and each such party shall be entitled to pursue all
legal and equitable rights and remedies and to secure performance of the
obligations and duties of the other under this Agreement, and the enforcement of
one or more of such rights and remedies by a party shall in no way preclude such
party from pursuing, at the same time or subsequently, any and all other rights
and remedies available to it.
7. Further Assurances. The Shareholder and the Optionholder
each agree to execute and deliver such other reasonable documents or agreements
as may be necessary or desirable for the implementation of this Agreement and
the consummation of the transactions contemplated hereby.
8. Submission to Jurisdiction; Waiver of Jury Trial; and
Consent to Service of Process.
(a) The parties hereto hereby irrevocably submit to the
exclusive jurisdiction of any federal or state court located within the State of
New York over any dispute arising out of or relating to this Agreement or any of
the transactions contemplated hereby or by the other Transaction Documents and
each party hereby irrevocably agrees that all claims in respect of such dispute
or any suit, action or proceeding related thereto may be heard and determined in
such courts. The parties hereby irrevocably waive, to the fullest extent
permitted by applicable law, any objection which they may now or hereafter have
to the laying of venue of any such dispute brought in such court or any defense
of inconvenient forum for the maintenance of such
- 3 -
<PAGE> 4
dispute. Each of the parties hereto agrees that a judgment in any such dispute
may be enforced in other jurisdictions by suit on the judgment or in any other
manner provided by law.
(b) THE PARTIES HEREBY KNOWINGLY, VOLUNTARILY AND
INTENTIONALLY WAIVE THE RIGHT ANY OF THEM MAY HAVE TO A TRIAL BY JURY IN RESPECT
OF ANY LITIGATION BASED HEREON OR ARISING OUT OF, UNDER OR IN CONNECTION WITH
THIS AGREEMENT AND ANY OF THE OTHER TRANSACTION DOCUMENTS, OR ANY COURSE OF
CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF
ANY PARTY. THIS PROVISION IS A MATERIAL INDUCEMENT FOR THE PARTIES' ACCEPTANCE
OF THIS AGREEMENT.
9. Entire Agreement; Amendments and Waivers. This Agreement,
together with the other Transaction Documents, represents the entire
understanding and agreement between the parties hereto with respect to the
subject matter hereof and can be amended, supplemented or changed, and any
provision hereof can be waived, only by written instrument making specific
reference to this Agreement signed by the parties hereto. No action taken
pursuant to this Agreement, including without limitation, any investigation by
or on behalf of any party, shall be deemed to constitute a waiver by the party
taking such action of compliance with any representation, warranty, covenant or
agreement contained herein. The waiver by any party hereto of a breach of any
provision of this Agreement shall not operate or be construed as a further or
continuing waiver of such breach or as a waiver of any other or subsequent
breach. No failure on the part of any party to exercise, and no delay in
exercising, any right, power or remedy hereunder shall operate as a waiver
thereof, nor shall any single or partial exercise of such right, power or remedy
by such party preclude any other or further exercise thereof or the exercise of
any other right, power or remedy. All remedies hereunder are cumulative and are
not exclusive of any other remedies provided by law.
10. Governing Law. This Agreement shall be governed by and
construed in accordance with the internal laws of the State of New York without
giving effect to the principles of conflict of laws thereunder.
11. Notices. All notices and other communications under this
Agreement shall be in writing and shall be deemed given when delivered in the
manner and at the addresses set forth in Section 5.4 of the Purchase Agreement.
12. Severability. If any term, provision, covenant or
condition of this Agreement or part thereof, or the application thereof to any
Person, place or circumstance shall be held to be invalid, unenforceable or void
by a court of competent jurisdiction, the remainder of this Agreement and such
term, provision, covenant or condition shall remain in full force and effect,
and any such invalid, unenforceable or void term, provision, covenant or
condition shall be deemed, without further action on the part of the parties
hereto, modified, amended and limited, and the court shall have the power to
modify, amend, and limit such term, provision, covenant or condition, to the
extent necessary to render the same and the remainder of this Agreement valid,
enforceable and lawful.
- 4 -
<PAGE> 5
13. Binding Effect, Assignment. This Agreement shall be
binding upon and inure to the benefit of the parties and their respective
permitted successors and assigns. Nothing in this Agreement shall create or be
deemed to create any third party beneficiary rights or any other rights of any
kind in any Person or entity not a party to this Agreement except as provided
below. No assignment of this Agreement or of any rights or obligations hereunder
may be made by the Shareholder (by operation of law or otherwise) without the
prior written consent of the Optionholder and any attempted assignment without
such required consent shall be void. The Optionholder may assign this Agreement
and any or all rights and obligations hereunder, in whole or in part, to any
Affiliate of the Optionholder or any purchaser of the Option, whether direct or
indirect, by purchase, merger, consolidation, operation of law or otherwise (any
such Affiliate or purchaser, a "Successor"). Upon any such permitted purchase or
succession the references in this Agreement to the Optionholder shall also apply
to any Successor unless the context otherwise requires.
- 5 -
<PAGE> 6
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed as of the date first written above.
----------------------------
Robert S. Trump
----------------------------
Jeffrey S. Silverman
- 6 -
<PAGE> 1
Exhibit 10.7
OPTION AGREEMENT
OPTION AGREEMENT, dated November 17, 1999 (this "Agreement"), by and
between Ronald Nash (the "Optionholder") and Robert S. Trump (the
"Shareholder").
WITNESSETH
The Optionholder and the Shareholder are each party to a Stock
Purchase Agreement, dated as of the date hereof (the "Purchase Agreement";
capitalized terms used but not defined herein have the meanings set forth in the
Purchase Agreement), providing for, among other things, the Optionholder's
acquisition of 500,000 shares of Common Stock, par value $.01 per share (the
"Common Stock"), of Financial Performance Corporation, a New York corporation
(the "Company").
As a condition and inducement to the Optionholder's
willingness to enter into the Purchase Agreement, the Optionholder has requested
that the Shareholder agree, and the Shareholder has agreed, to grant the
Optionholder the Option (as defined below).
NOW, THEREFORE, in consideration of the promises and mutual
covenants and agreements hereinafter contained, the parties hereto, intending to
be legally bound, hereby agree as follows:
1. Grant of Option.
(a) Subject to and upon the terms and conditions set forth in
this Agreement, the Shareholder hereby grants an irrevocable option (the
"Option") to the Optionholder to purchase up to 500,000 shares (the "Shares") of
Common Stock of the Company owned, beneficially and of record, by the
Shareholder, at a purchase price of $.8125 per Share.
(b) The Option may be partially exercised from time to time in
denominations of 50,000 shares or more in any one instance. The Option may not
be exercised in part more than six times in a calendar year.
(c) The Option shall expire and cease to be exercisable two
years after the date of this Agreement (November 17, 2001) (the "Termination
Date").
2. Method of Exercise. (a) The Option or any part thereof may
be exercised by the giving of a written notice to the Shareholder (each an
"Exercise Notice") executed by or on behalf of the Optionholder, to the
Shareholder at the address set forth in Section 5.4 of the Purchase Agreement,
which Exercise Notice shall state the election to exercise the Option, the
number of whole Shares with respect to which the Option is being exercised and
the place (in New York City) and date for the closing of the purchase; provided
that such date shall be not earlier than three business days nor later than
fifteen business days from the date such notice is given, and provided, further,
that if such purchase cannot be consummated during
<PAGE> 2
such fifteen business day period due to any law or regulation, the date for the
closing of such purchase shall be within five business days following the
cessation of such restriction on consummation.
3. Payment and Delivery of Shares. At any closing hereunder,
(a) the Optionholder shall pay the aggregate purchase price for the Shares to be
purchased, which shall be payable by bank check or by wire transfer to an
account designated by Trump, and (b) the Shareholder shall deliver to the
Optionholder (i) a certificate or certificates representing the Shares so
purchased registered in the name of the Optionholder or his designee or (ii) a
certificate or certificates representing the Shares so purchased duly endorsed
in blank for transfer or accompanied by appropriate stock powers duly executed
in blank. If any of the Shares shall be held by Trump in a brokerage account,
Trump may deliver to the brokerage firm in which such Shares are held, written
notice to transfer record and beneficial ownership of the Shares purchased by
the Optionholder to the brokerage account of the Optionholder. The Optionholder
shall designate his brokerage account together with the Exercise Notice. The
Optionholder shall reasonably cooperate with Trump and shall take reasonable
actions requested by Trump to effectuate such transfer of ownership. However it
shall be solely Trump's obligation to effectuate such transfer of ownership.
4. Representations and Warranties of the Shareholder.
(a) The representations and warranties of the Shareholder
contained in Section 3 of the Purchase Agreement are hereby incorporated by
reference herein in full with the same force and effect as though expressly made
as part of this Agreement.
(b) Prior to the Termination Date, the Shareholder will not
take, and will not permit anyone else to take, any action which might have the
effect of preventing or disabling the Shareholder from delivering the Shares
(free and clear of any liens, claims, security interests, or encumbrances
whatsoever) to the Optionholder upon exercise of the Option or from otherwise
performing its obligations under this Agreement.
4A. Representations and Warranties of the Optionholder. The
representations and warranties of the Optionholder contained in Section 5 of the
Purchase Agreement are hereby incorporated by reference herein in full with the
same force and effect as though expressly made as part of this Agreement.
5. Adjustments. (a) In case the Company shall at any time
after the date of this Agreement (i) declare a dividend or make a distribution
on the Common Stock in shares of its capital stock, (ii) subdivide the
outstanding Common Stock; (iii) combine the outstanding Common Stock into a
smaller number of shares or (iv) issue any shares of its capital stock by
reclassification of the Common Stock (including any such reclassification in
connection with a consolidation or merger in which the Company is the continuing
corporation), or take any action similar to (i) through (iv), then the number
and kind of shares of capital stock purchasable upon exercise of the Option
immediately after the happening of such event shall be adjusted so that, after
giving effect to such adjustment, the Optionholder shall be entitled to receive
the number and kind of shares of capital stock upon exercise that such holder
would have owned or been
- 2 -
<PAGE> 3
entitled to receive had such Option been exercised immediately prior to the
happening of the events described above (or in the case of clause (i) above,
immediately prior to the record date therefor). An adjustment made pursuant to
this Section 5(a) shall become effective immediately after the effective date,
retroactive to the record date therefor in the case of clause (i) above, and
shall become effective immediately after the effective date in the case of
clauses (ii), (iii) or (iv) above.
(b) In case of any consolidation or merger of the Company with
or into another corporation (other than a merger with a subsidiary in which the
Company is the continuing corporation and which does not result in any
reclassification, capital reorganization or other change of the outstanding
Shares issuable upon exercise of the Option) or in case of the sale, transfer or
other disposition of all or substantially all of the assets of the Company, then
the Optionholder shall be entitled to receive upon exercise of the Option such
number of shares of capital stock or other securities or property upon, or as a
result of, such transaction that the Optionholder would have been entitled to
receive had the Option been exercised immediately prior to such transaction.
6. Specific Performance. The Shareholder acknowledges and
agrees that the breach or threatened breach of this Agreement would cause
irreparable damage to the Optionholder and that the Optionholder will not have
an adequate remedy at law. Accordingly, the Shareholder expressly acknowledges
that the Optionholder shall be entitled to specific performance, injunctive
relief or any other equitable remedy against the Shareholder, in the event of
any breach or threatened breach of any provision of this Agreement by the
Shareholder. The rights and remedies of the parties hereto are cumulative and
shall not be exclusive, and each such party shall be entitled to pursue all
legal and equitable rights and remedies and to secure performance of the
obligations and duties of the other under this Agreement, and the enforcement of
one or more of such rights and remedies by a party shall in no way preclude such
party from pursuing, at the same time or subsequently, any and all other rights
and remedies available to it.
7. Further Assurances. The Shareholder and the Optionholder
each agree to execute and deliver such other reasonable documents or agreements
as may be necessary or desirable for the implementation of this Agreement and
the consummation of the transactions contemplated hereby.
8. Submission to Jurisdiction; Waiver of Jury Trial; and
Consent to Service of Process.
(a) The parties hereto hereby irrevocably submit to the
exclusive jurisdiction of any federal or state court located within the State of
New York over any dispute arising out of or relating to this Agreement or any of
the transactions contemplated hereby or by the other Transaction Documents and
each party hereby irrevocably agrees that all claims in respect of such dispute
or any suit, action or proceeding related thereto may be heard and determined in
such courts. The parties hereby irrevocably waive, to the fullest extent
permitted by applicable law, any objection which they may now or hereafter have
to the laying of venue of any such dispute brought in such court or any defense
of inconvenient forum for the maintenance of such
- 3 -
<PAGE> 4
dispute. Each of the parties hereto agrees that a judgment in any such dispute
may be enforced in other jurisdictions by suit on the judgment or in any other
manner provided by law.
(b) THE PARTIES HEREBY KNOWINGLY, VOLUNTARILY AND
INTENTIONALLY WAIVE THE RIGHT ANY OF THEM MAY HAVE TO A TRIAL BY JURY IN RESPECT
OF ANY LITIGATION BASED HEREON OR ARISING OUT OF, UNDER OR IN CONNECTION WITH
THIS AGREEMENT AND ANY OF THE OTHER TRANSACTION DOCUMENTS, OR ANY COURSE OF
CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF
ANY PARTY. THIS PROVISION IS A MATERIAL INDUCEMENT FOR THE PARTIES' ACCEPTANCE
OF THIS AGREEMENT.
9. Entire Agreement; Amendments and Waivers. This Agreement,
together with the other Transaction Documents, represents the entire
understanding and agreement between the parties hereto with respect to the
subject matter hereof and can be amended, supplemented or changed, and any
provision hereof can be waived, only by written instrument making specific
reference to this Agreement signed by the parties hereto. No action taken
pursuant to this Agreement, including without limitation, any investigation by
or on behalf of any party, shall be deemed to constitute a waiver by the party
taking such action of compliance with any representation, warranty, covenant or
agreement contained herein. The waiver by any party hereto of a breach of any
provision of this Agreement shall not operate or be construed as a further or
continuing waiver of such breach or as a waiver of any other or subsequent
breach. No failure on the part of any party to exercise, and no delay in
exercising, any right, power or remedy hereunder shall operate as a waiver
thereof, nor shall any single or partial exercise of such right, power or remedy
by such party preclude any other or further exercise thereof or the exercise of
any other right, power or remedy. All remedies hereunder are cumulative and are
not exclusive of any other remedies provided by law.
10. Governing Law. This Agreement shall be governed by and
construed in accordance with the internal laws of the State of New York without
giving effect to the principles of conflict of laws thereunder.
11. Notices. All notices and other communications under this
Agreement shall be in writing and shall be deemed given when delivered in the
manner and at the addresses set forth in Section 5.4 of the Purchase Agreement.
12. Severability. If any term, provision, covenant or
condition of this Agreement or part thereof, or the application thereof to any
Person, place or circumstance shall be held to be invalid, unenforceable or void
by a court of competent jurisdiction, the remainder of this Agreement and such
term, provision, covenant or condition shall remain in full force and effect,
and any such invalid, unenforceable or void term, provision, covenant or
condition shall be deemed, without further action on the part of the parties
hereto, modified, amended and limited, and the court shall have the power to
modify, amend, and limit such term, provision, covenant or condition, to the
extent necessary to render the same and the remainder of this Agreement valid,
enforceable and lawful.
- 4 -
<PAGE> 5
13. Binding Effect, Assignment. This Agreement shall be
binding upon and inure to the benefit of the parties and their respective
permitted successors and assigns. Nothing in this Agreement shall create or be
deemed to create any third party beneficiary rights or any other rights of any
kind in any Person or entity not a party to this Agreement except as provided
below. No assignment of this Agreement or of any rights or obligations hereunder
may be made by the Shareholder (by operation of law or otherwise) without the
prior written consent of the Optionholder and any attempted assignment without
such required consent shall be void. The Optionholder may assign this Agreement
and any or all rights and obligations hereunder, in whole or in part, to any
Affiliate of the Optionholder or any purchaser of the Option, whether direct or
indirect, by purchase, merger, consolidation, operation of law or otherwise (any
such Affiliate or purchaser, a "Successor"). Upon any such permitted purchase or
succession the references in this Agreement to the Optionholder shall also apply
to any Successor unless the context otherwise requires.
- 5 -
<PAGE> 6
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed as of the date first written above.
----------------------------
Robert S. Trump
----------------------------
Ronald Nash
- 6 -
<PAGE> 1
Exhibit 10.8
OPTION AGREEMENT
OPTION AGREEMENT, dated November 17, 1999 (this "Agreement"), by and
between Ronald Nash (the "Optionholder") and Robert S. Trump (the
"Shareholder").
WITNESSETH
The Optionholder and the Shareholder are each party to a Stock
Purchase Agreement, dated as of the date hereof (the "Purchase Agreement";
capitalized terms used but not defined herein have the meanings set forth in the
Purchase Agreement), providing for, among other things, the Optionholder's
acquisition of 500,000 shares of Common Stock, par value $.01 per share (the
"Common Stock"), of Financial Performance Corporation, a New York corporation
(the "Company").
As a condition and inducement to the Optionholder's
willingness to enter into the Purchase Agreement, the Optionholder has requested
that the Shareholder agree, and the Shareholder has agreed, to grant the
Optionholder the Option (as defined below).
NOW, THEREFORE, in consideration of the promises and mutual
covenants and agreements hereinafter contained, the parties hereto, intending to
be legally bound, hereby agree as follows:
1. Grant of Option.
(a) Subject to and upon the terms and conditions set forth in
this Agreement, the Shareholder hereby grants an irrevocable option (the
"Option") to the Optionholder to purchase up to 500,000 shares (the "Shares") of
Common Stock of the Company owned, beneficially and of record, by the
Shareholder, at a purchase price of $1.3125 per Share.
(b) The Option may be partially exercised from time to time in
denominations of 50,000 shares or more in any one instance. The Option may not
be exercised in part more than six times in a calendar year.
(c) The Option shall expire and cease to be exercisable three
years after the date of this Agreement (November 17, 2002) (the "Termination
Date").
2. Method of Exercise. (a) The Option or any part thereof may
be exercised by the giving of a written notice to the Shareholder (each an
"Exercise Notice") executed by or on behalf of the Optionholder, to the
Shareholder at the address set forth in Section 5.4 of the Purchase Agreement,
which Exercise Notice shall state the election to exercise the Option, the
number of whole Shares with respect to which the Option is being exercised and
the place (in New York City) and date for the closing of the purchase; provided
that such date shall be not earlier than three business days nor later than
fifteen business days from the date such notice is given, and provided, further,
that if such purchase cannot be consummated during
<PAGE> 2
such fifteen business day period due to any law or regulation, the date for the
closing of such purchase shall be within five business days following the
cessation of such restriction on consummation.
3. Payment and Delivery of Shares. At any closing hereunder,
(a) the Optionholder shall pay the aggregate purchase price for the Shares to be
purchased, which shall be payable by bank check or by wire transfer to an
account designated by Trump, and (b) the Shareholder shall deliver to the
Optionholder (i) a certificate or certificates representing the Shares so
purchased registered in the name of the Optionholder or his designee or (ii) a
certificate or certificates representing the Shares so purchased duly endorsed
in blank for transfer or accompanied by appropriate stock powers duly executed
in blank. If any of the Shares shall be held by Trump in a brokerage account,
Trump may deliver to the brokerage firm in which such Shares are held, written
notice to transfer record and beneficial ownership of the Shares purchased by
the Optionholder to the brokerage account of the Optionholder. The Optionholder
shall designate his brokerage account together with the Exercise Notice. The
Optionholder shall reasonably cooperate with Trump and shall take reasonable
actions requested by Trump to effectuate such transfer of ownership. However it
shall be solely Trump's obligation to effectuate such transfer of ownership.
4. Representations and Warranties of the Shareholder.
(a) The representations and warranties of the Shareholder
contained in Section 3 of the Purchase Agreement are hereby incorporated by
reference herein in full with the same force and effect as though expressly made
as part of this Agreement.
(b) Prior to the Termination Date, the Shareholder will not
take, and will not permit anyone else to take, any action which might have the
effect of preventing or disabling the Shareholder from delivering the Shares
(free and clear of any liens, claims, security interests, or encumbrances
whatsoever) to the Optionholder upon exercise of the Option or from otherwise
performing its obligations under this Agreement.
4A. Representations and Warranties of the Optionholder. The
representations and warranties of the Optionholder contained in Section 5 of the
Purchase Agreement are hereby incorporated by reference herein in full with the
same force and effect as though expressly made as part of this Agreement.
5. Adjustments. (a) In case the Company shall at any time
after the date of this Agreement (i) declare a dividend or make a distribution
on the Common Stock in shares of its capital stock, (ii) subdivide the
outstanding Common Stock; (iii) combine the outstanding Common Stock into a
smaller number of shares or (iv) issue any shares of its capital stock by
reclassification of the Common Stock (including any such reclassification in
connection with a consolidation or merger in which the Company is the continuing
corporation), or take any action similar to (i) through (iv), then the number
and kind of shares of capital stock purchasable upon exercise of the Option
immediately after the happening of such event shall be adjusted so that, after
giving effect to such adjustment, the Optionholder shall be entitled to receive
the number and kind of shares of capital stock upon exercise that such holder
would have owned or been
- 2 -
<PAGE> 3
entitled to receive had such Option been exercised immediately prior to the
happening of the events described above (or in the case of clause (i) above,
immediately prior to the record date therefor). An adjustment made pursuant to
this Section 5(a) shall become effective immediately after the effective date,
retroactive to the record date therefor in the case of clause (i) above, and
shall become effective immediately after the effective date in the case of
clauses (ii), (iii) or (iv) above.
(b) In case of any consolidation or merger of the Company with
or into another corporation (other than a merger with a subsidiary in which the
Company is the continuing corporation and which does not result in any
reclassification, capital reorganization or other change of the outstanding
Shares issuable upon exercise of the Option) or in case of the sale, transfer or
other disposition of all or substantially all of the assets of the Company, then
the Optionholder shall be entitled to receive upon exercise of the Option such
number of shares of capital stock or other securities or property upon, or as a
result of, such transaction that the Optionholder would have been entitled to
receive had the Option been exercised immediately prior to such transaction.
6. Specific Performance. The Shareholder acknowledges and
agrees that the breach or threatened breach of this Agreement would cause
irreparable damage to the Optionholder and that the Optionholder will not have
an adequate remedy at law. Accordingly, the Shareholder expressly acknowledges
that the Optionholder shall be entitled to specific performance, injunctive
relief or any other equitable remedy against the Shareholder, in the event of
any breach or threatened breach of any provision of this Agreement by the
Shareholder. The rights and remedies of the parties hereto are cumulative and
shall not be exclusive, and each such party shall be entitled to pursue all
legal and equitable rights and remedies and to secure performance of the
obligations and duties of the other under this Agreement, and the enforcement of
one or more of such rights and remedies by a party shall in no way preclude such
party from pursuing, at the same time or subsequently, any and all other rights
and remedies available to it.
7. Further Assurances. The Shareholder and the Optionholder
each agree to execute and deliver such other reasonable documents or agreements
as may be necessary or desirable for the implementation of this Agreement and
the consummation of the transactions contemplated hereby.
8. Submission to Jurisdiction; Waiver of Jury Trial; and
Consent to Service of Process.
(a) The parties hereto hereby irrevocably submit to the
exclusive jurisdiction of any federal or state court located within the State of
New York over any dispute arising out of or relating to this Agreement or any of
the transactions contemplated hereby or by the other Transaction Documents and
each party hereby irrevocably agrees that all claims in respect of such dispute
or any suit, action or proceeding related thereto may be heard and determined in
such courts. The parties hereby irrevocably waive, to the fullest extent
permitted by applicable law, any objection which they may now or hereafter have
to the laying of venue of any such dispute brought in such court or any defense
of inconvenient forum for the maintenance of such
- 3 -
<PAGE> 4
dispute. Each of the parties hereto agrees that a judgment in any such dispute
may be enforced in other jurisdictions by suit on the judgment or in any other
manner provided by law.
(b) THE PARTIES HEREBY KNOWINGLY, VOLUNTARILY AND
INTENTIONALLY WAIVE THE RIGHT ANY OF THEM MAY HAVE TO A TRIAL BY JURY IN RESPECT
OF ANY LITIGATION BASED HEREON OR ARISING OUT OF, UNDER OR IN CONNECTION WITH
THIS AGREEMENT AND ANY OF THE OTHER TRANSACTION DOCUMENTS, OR ANY COURSE OF
CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF
ANY PARTY. THIS PROVISION IS A MATERIAL INDUCEMENT FOR THE PARTIES' ACCEPTANCE
OF THIS AGREEMENT.
9. Entire Agreement; Amendments and Waivers. This Agreement,
together with the other Transaction Documents, represents the entire
understanding and agreement between the parties hereto with respect to the
subject matter hereof and can be amended, supplemented or changed, and any
provision hereof can be waived, only by written instrument making specific
reference to this Agreement signed by the parties hereto. No action taken
pursuant to this Agreement, including without limitation, any investigation by
or on behalf of any party, shall be deemed to constitute a waiver by the party
taking such action of compliance with any representation, warranty, covenant or
agreement contained herein. The waiver by any party hereto of a breach of any
provision of this Agreement shall not operate or be construed as a further or
continuing waiver of such breach or as a waiver of any other or subsequent
breach. No failure on the part of any party to exercise, and no delay in
exercising, any right, power or remedy hereunder shall operate as a waiver
thereof, nor shall any single or partial exercise of such right, power or remedy
by such party preclude any other or further exercise thereof or the exercise of
any other right, power or remedy. All remedies hereunder are cumulative and are
not exclusive of any other remedies provided by law.
10. Governing Law. This Agreement shall be governed by and
construed in accordance with the internal laws of the State of New York without
giving effect to the principles of conflict of laws thereunder.
11. Notices. All notices and other communications under this
Agreement shall be in writing and shall be deemed given when delivered in the
manner and at the addresses set forth in Section 5.4 of the Purchase Agreement.
12. Severability. If any term, provision, covenant or
condition of this Agreement or part thereof, or the application thereof to any
Person, place or circumstance shall be held to be invalid, unenforceable or void
by a court of competent jurisdiction, the remainder of this Agreement and such
term, provision, covenant or condition shall remain in full force and effect,
and any such invalid, unenforceable or void term, provision, covenant or
condition shall be deemed, without further action on the part of the parties
hereto, modified, amended and limited, and the court shall have the power to
modify, amend, and limit such term, provision, covenant or condition, to the
extent necessary to render the same and the remainder of this Agreement valid,
enforceable and lawful.
- 4 -
<PAGE> 5
13. Binding Effect, Assignment. This Agreement shall be
binding upon and inure to the benefit of the parties and their respective
permitted successors and assigns. Nothing in this Agreement shall create or be
deemed to create any third party beneficiary rights or any other rights of any
kind in any Person or entity not a party to this Agreement except as provided
below. No assignment of this Agreement or of any rights or obligations hereunder
may be made by the Shareholder (by operation of law or otherwise) without the
prior written consent of the Optionholder and any attempted assignment without
such required consent shall be void. The Optionholder may assign this Agreement
and any or all rights and obligations hereunder, in whole or in part, to any
Affiliate of the Optionholder or any purchaser of the Option, whether direct or
indirect, by purchase, merger, consolidation, operation of law or otherwise (any
such Affiliate or purchaser, a "Successor"). Upon any such permitted purchase or
succession the references in this Agreement to the Optionholder shall also apply
to any Successor unless the context otherwise requires.
- 5 -
<PAGE> 6
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed as of the date first written above.
----------------------------
Robert S. Trump
----------------------------
Ronald Nash
- 6 -
<PAGE> 1
Exhibit 10.9
OPTION AGREEMENT
----------------
OPTION AGREEMENT, dated November 17, 1999 (this "Agreement"), by and
between Ronald Nash (the "Optionholder") and Robert S. Trump (the
"Shareholder").
WITNESSETH
----------
The Optionholder and the Shareholder are each party to a Stock
Purchase Agreement, dated as of the date hereof (the "Purchase Agreement";
capitalized terms used but not defined herein have the meanings set forth in the
Purchase Agreement), providing for, among other things, the Optionholder's
acquisition of 250,000 shares of Common Stock, par value $.01 per share (the
"Common Stock"), of Financial Performance Corporation, a New York corporation
(the "Company").
As a condition and inducement to the Optionholder's
willingness to enter into the Purchase Agreement, the Optionholder has requested
that the Shareholder agree, and the Shareholder has agreed, to grant the
Optionholder the Option (as defined below).
NOW, THEREFORE, in consideration of the promises and mutual
covenants and agreements hereinafter contained, the parties hereto, intending to
be legally bound, hereby agree as follows:
1. Grant of Option.
(a) Subject to and upon the terms and conditions set forth in
this Agreement, the Shareholder hereby grants an irrevocable option (the
"Option") to the Optionholder to purchase up to 250,000 shares (the "Shares") of
Common Stock of the Company owned, beneficially and of record, by the
Shareholder, at a purchase price of $5.00 per Share.
(b) The Option may be partially exercised from time to time in
denominations of 50,000 shares or more in any one instance. The Option may not
be exercised in part more than six times in a calendar year.
(c) The Option shall expire and cease to be exercisable three
years after the date of this Agreement (November 17, 2002) (the "Termination
Date").
2. Method of Exercise. (a) The Option or any part thereof may
be exercised by the giving of a written notice to the Shareholder (each an
"Exercise Notice") executed by or on behalf of the Optionholder, to the
Shareholder at the address set forth in Section 5.4 of the Purchase Agreement,
which Exercise Notice shall state the election to exercise the Option, the
number of whole Shares with respect to which the Option is being exercised and
the place (in New York City) and date for the closing of the purchase; provided
that such date shall be not earlier than three business days nor later than
fifteen business days from the date such notice is given, and provided, further,
that if such purchase cannot be consummated during
<PAGE> 2
such fifteen business day period due to any law or regulation, the date for the
closing of such purchase shall be within five business days following the
cessation of such restriction on consummation.
3. Payment and Delivery of Shares. At any closing hereunder,
(a) the Optionholder shall pay the aggregate purchase price for the Shares to be
purchased, which shall be payable by bank check or by wire transfer to an
account designated by Trump, and (b) the Shareholder shall deliver to the
Optionholder (i) a certificate or certificates representing the Shares so
purchased registered in the name of the Optionholder or his designee or (ii) a
certificate or certificates representing the Shares so purchased duly endorsed
in blank for transfer or accompanied by appropriate stock powers duly executed
in blank. If any of the Shares shall be held by Trump in a brokerage account,
Trump may deliver to the brokerage firm in which such Shares are held, written
notice to transfer record and beneficial ownership of the Shares purchased by
the Optionholder to the brokerage account of the Optionholder. The Optionholder
shall designate his brokerage account together with the Exercise Notice. The
Optionholder shall reasonably cooperate with Trump and shall take reasonable
actions requested by Trump to effectuate such transfer of ownership. However it
shall be solely Trump's obligation to effectuate such transfer of ownership.
4. Representations and Warranties of the Shareholder.
(a) The representations and warranties of the Shareholder
contained in Section 3 of the Purchase Agreement are hereby incorporated by
reference herein in full with the same force and effect as though expressly made
as part of this Agreement.
(b) Prior to the Termination Date, the Shareholder will not
take, and will not permit anyone else to take, any action which might have the
effect of preventing or disabling the Shareholder from delivering the Shares
(free and clear of any liens, claims, security interests, or encumbrances
whatsoever) to the Optionholder upon exercise of the Option or from otherwise
performing its obligations under this Agreement.
4A. Representations and Warranties of the Optionholder. The
representations and warranties of the Optionholder contained in Section 5 of the
Purchase Agreement are hereby incorporated by reference herein in full with the
same force and effect as though expressly made as part of this Agreement.
5. Adjustments. (a) In case the Company shall at any time
after the date of this Agreement (i) declare a dividend or make a distribution
on the Common Stock in shares of its capital stock, (ii) subdivide the
outstanding Common Stock; (iii) combine the outstanding Common Stock into a
smaller number of shares or (iv) issue any shares of its capital stock by
reclassification of the Common Stock (including any such reclassification in
connection with a consolidation or merger in which the Company is the continuing
corporation), or take any action similar to (i) through (iv), then the number
and kind of shares of capital stock purchasable upon exercise of the Option
immediately after the happening of such event shall be adjusted so that, after
giving effect to such adjustment, the Optionholder shall be entitled to receive
the number and kind of shares of capital stock upon exercise that such holder
would have owned or been
- 2 -
<PAGE> 3
entitled to receive had such Option been exercised immediately prior to the
happening of the events described above (or in the case of clause (i) above,
immediately prior to the record date therefor). An adjustment made pursuant to
this Section 5(a) shall become effective immediately after the effective date,
retroactive to the record date therefor in the case of clause (i) above, and
shall become effective immediately after the effective date in the case of
clauses (ii), (iii) or (iv) above.
(b) In case of any consolidation or merger of the Company with
or into another corporation (other than a merger with a subsidiary in which the
Company is the continuing corporation and which does not result in any
reclassification, capital reorganization or other change of the outstanding
Shares issuable upon exercise of the Option) or in case of the sale, transfer or
other disposition of all or substantially all of the assets of the Company, then
the Optionholder shall be entitled to receive upon exercise of the Option such
number of shares of capital stock or other securities or property upon, or as a
result of, such transaction that the Optionholder would have been entitled to
receive had the Option been exercised immediately prior to such transaction.
6. Specific Performance. The Shareholder acknowledges and
agrees that the breach or threatened breach of this Agreement would cause
irreparable damage to the Optionholder and that the Optionholder will not have
an adequate remedy at law. Accordingly, the Shareholder expressly acknowledges
that the Optionholder shall be entitled to specific performance, injunctive
relief or any other equitable remedy against the Shareholder, in the event of
any breach or threatened breach of any provision of this Agreement by the
Shareholder. The rights and remedies of the parties hereto are cumulative and
shall not be exclusive, and each such party shall be entitled to pursue all
legal and equitable rights and remedies and to secure performance of the
obligations and duties of the other under this Agreement, and the enforcement of
one or more of such rights and remedies by a party shall in no way preclude such
party from pursuing, at the same time or subsequently, any and all other rights
and remedies available to it.
7. Further Assurances. The Shareholder and the Optionholder
each agree to execute and deliver such other reasonable documents or agreements
as may be necessary or desirable for the implementation of this Agreement and
the consummation of the transactions contemplated hereby.
8. Submission to Jurisdiction; Waiver of Jury Trial; and
Consent to Service of Process.
(a) The parties hereto hereby irrevocably submit to the
exclusive jurisdiction of any federal or state court located within the State of
New York over any dispute arising out of or relating to this Agreement or any of
the transactions contemplated hereby or by the other Transaction Documents and
each party hereby irrevocably agrees that all claims in respect of such dispute
or any suit, action or proceeding related thereto may be heard and determined in
such courts. The parties hereby irrevocably waive, to the fullest extent
permitted by applicable law, any objection which they may now or hereafter have
to the laying of venue of any such dispute brought in such court or any defense
of inconvenient forum for the maintenance of such
- 3 -
<PAGE> 4
dispute. Each of the parties hereto agrees that a judgment in any such dispute
may be enforced in other jurisdictions by suit on the judgment or in any other
manner provided by law.
(b) THE PARTIES HEREBY KNOWINGLY, VOLUNTARILY AND
INTENTIONALLY WAIVE THE RIGHT ANY OF THEM MAY HAVE TO A TRIAL BY JURY IN RESPECT
OF ANY LITIGATION BASED HEREON OR ARISING OUT OF, UNDER OR IN CONNECTION WITH
THIS AGREEMENT AND ANY OF THE OTHER TRANSACTION DOCUMENTS, OR ANY COURSE OF
CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF
ANY PARTY. THIS PROVISION IS A MATERIAL INDUCEMENT FOR THE PARTIES' ACCEPTANCE
OF THIS AGREEMENT.
9. Entire Agreement; Amendments and Waivers. This Agreement,
together with the other Transaction Documents, represents the entire
understanding and agreement between the parties hereto with respect to the
subject matter hereof and can be amended, supplemented or changed, and any
provision hereof can be waived, only by written instrument making specific
reference to this Agreement signed by the parties hereto. No action taken
pursuant to this Agreement, including without limitation, any investigation by
or on behalf of any party, shall be deemed to constitute a waiver by the party
taking such action of compliance with any representation, warranty, covenant or
agreement contained herein. The waiver by any party hereto of a breach of any
provision of this Agreement shall not operate or be construed as a further or
continuing waiver of such breach or as a waiver of any other or subsequent
breach. No failure on the part of any party to exercise, and no delay in
exercising, any right, power or remedy hereunder shall operate as a waiver
thereof, nor shall any single or partial exercise of such right, power or remedy
by such party preclude any other or further exercise thereof or the exercise of
any other right, power or remedy. All remedies hereunder are cumulative and are
not exclusive of any other remedies provided by law.
10. Governing Law. This Agreement shall be governed by and
construed in accordance with the internal laws of the State of New York without
giving effect to the principles of conflict of laws thereunder.
11. Notices. All notices and other communications under this
Agreement shall be in writing and shall be deemed given when delivered in the
manner and at the addresses set forth in Section 5.4 of the Purchase Agreement.
12. Severability. If any term, provision, covenant or
condition of this Agreement or part thereof, or the application thereof to any
Person, place or circumstance shall be held to be invalid, unenforceable or void
by a court of competent jurisdiction, the remainder of this Agreement and such
term, provision, covenant or condition shall remain in full force and effect,
and any such invalid, unenforceable or void term, provision, covenant or
condition shall be deemed, without further action on the part of the parties
hereto, modified, amended and limited, and the court shall have the power to
modify, amend, and limit such term, provision, covenant or condition, to the
extent necessary to render the same and the remainder of this Agreement valid,
enforceable and lawful.
- 4 -
<PAGE> 5
13. Binding Effect, Assignment. This Agreement shall be
binding upon and inure to the benefit of the parties and their respective
permitted successors and assigns. Nothing in this Agreement shall create or be
deemed to create any third party beneficiary rights or any other rights of any
kind in any Person or entity not a party to this Agreement except as provided
below. No assignment of this Agreement or of any rights or obligations hereunder
may be made by the Shareholder (by operation of law or otherwise) without the
prior written consent of the Optionholder and any attempted assignment without
such required consent shall be void. The Optionholder may assign this Agreement
and any or all rights and obligations hereunder, in whole or in part, to any
Affiliate of the Optionholder or any purchaser of the Option, whether direct or
indirect, by purchase, merger, consolidation, operation of law or otherwise (any
such Affiliate or purchaser, a "Successor"). Upon any such permitted purchase or
succession the references in this Agreement to the Optionholder shall also apply
to any Successor unless the context otherwise requires.
- 5 -
<PAGE> 6
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed as of the date first written above.
----------------------------
Robert S. Trump
----------------------------
Ronald Nash
- 6 -
<PAGE> 1
Exhibit 10.10
FINANCIAL PERFORMANCE CORPORATION
STOCK OPTION AGREEMENT
STOCK OPTION AGREEMENT (the "Agreement"), dated as of November
17, 1999, between FINANCIAL PERFORMANCE CORPORATION, a New York corporation (the
"Company"), having an address at 335 Madison Avenue, 8th floor, New York, New
York 10017 and JEFFREY SILVERMAN, having an address at c/o LTS Capital Partners,
777 Third Avenue, New York, New York 10017 (the "Grantee").
The Company hereby grants to the Grantee an irrevocable
nonqualified stock option (the "Option") to purchase from time to time all or
any part of an aggregate of 1,000,000 shares of the Company's common stock, $.01
par value per share (the "Shares"). This Option is a nonqualified Stock Option
which is not intended to be an "incentive stock option" within the meaning of
Section 422 of the Internal Revenue Code of 1986, as amended (the "Code").
To evidence the Option and to set forth its terms, the Company
and the Grantee agree as follows:
1. Confirmation of Grant. The Company hereby evidences and
confirms its grant of the Option to the Grantee on the date of this Agreement.
2. Number of Shares. This Option shall be for an aggregate of
1,000,000 Shares.
3. Exercise Price. The exercise price shall be $.43 per share,
which amount equals the closing sale price of the Company's common stock as
quoted on the OTC Bulletin Board as of the close of business on November 15,
1999.
4. Medium and Time of Payment. The exercise price of the
Option shall be paid in cash or by check payable to the order of the Company at
the time of exercise. In addition, the Company shall accept full or partial
payment in Shares previously owned by the Grantee having an aggregate fair
market value on the date of exercise equal to the portion of the exercise price
being so paid. The option may be partially exercised from time to time.
Payment in full for all Shares with respect to which the
Option is then being exercised shall be required before the issuance of any
Shares pursuant to the exercise of the Option. In connection with the delivery
of any certificates representing the Shares, the Company shall, at the request
of the Grantee, withhold a number of Shares having an aggregate fair market
value on the date of the exercise of the Option equal to the taxes then required
by applicable federal, state and local law to be so withheld and such shares
shall be irrevocably returned to treasury stock of the Company. If the Grantee
does not so request the Company to withhold Shares, the Grantee shall pay to the
Company any amount necessary to satisfy any applicable federal, state, or local
tax withholding obligations.
<PAGE> 2
5. Term and Exercise of the Option. The Option shall expire
five years from the date of this Agreement and may be exercised for all or any
portion of the Shares (in whole shares) at any time and from time to time during
such period.
This Option may be exercised only by written notice to the
Company indicating the number of whole Shares which are being purchased. Such
notice must be signed by the Grantee and be accompanied by full payment of the
exercise price.
6. Transferability. The Option may only be transferred to an
Affiliate of Grantee or by will or the laws of descent and distribution.
7. Adjustments. (a) In case the Company shall at any time
after the date of this Agreement (i) declare a dividend or make a distribution
on the Common Stock in shares of its capital stock, (ii) subdivide the
outstanding Common Stock; (iii) combine the outstanding Common Stock into a
smaller number of shares or (iv) issue any shares of its capital stock by
reclassification of the Common Stock (including any such reclassification in
connection with a consolidation or merger in which the Company is the continuing
corporation), or take any action similar to (i) through (iv), then the number
and kind of shares of capital stock purchasable upon exercise of the Option
immediately after the happening of such event shall be adjusted so that, after
giving effect to such adjustment, the Grantee shall be entitled to receive the
number and kind of shares of capital stock upon exercise that such holder would
have owned or been entitled to receive had such Option been exercised
immediately prior to the happening of the events described above (or in the case
of clause (i) above, immediately prior to the record date therefor). An
adjustment made pursuant to this Section 10(a) shall become effective
immediately after the effective date, retroactive to the record date therefor in
the case of clause (i) above, and shall become effective immediately after the
effective date in the case of clauses (ii), (iii) or (iv) above.
(b) In case of any consolidation or merger of the Company
with or into another corporation (other than a merger with a subsidiary in which
the Company is the continuing corporation and which does not result in any
reclassification, capital reorganization or other change of the outstanding
Shares issuable upon exercise of the Option) or in case of the sale, transfer or
other disposition of all or substantially all of the assets of the Company, then
the Grantee shall be entitled to receive upon exercise of the Option such number
of shares of capital stock or other securities or property upon, or as a result
of, such transaction that the Grantee would have been entitled to receive had
the Option been exercised immediately prior to such transaction.
8. Representations and Warranties of the Company. The Company
hereby represents and warrants to the Grantee as follows:
8.1 This Agreement has been duly and validly authorized,
executed and delivered by the Company. This Agreement constitutes the legal,
valid and binding obligations of the Company, enforceable against the Company in
accordance with its terms, subject, as to enforceability, to applicable
bankruptcy, insolvency, reorganization, moratorium and similar laws affecting
creditors' rights and remedies generally and to general principles of equity
(regardless of whether enforcement is sought in a proceeding at law or in
equity).
2
<PAGE> 3
8.2 No Conflicts; Consents of Third Parties. The execution
and delivery by the Company of this Agreement, the consummation of the
transactions contemplated hereby, and the compliance by the Company with any of
the provisions hereof does not (i) conflict with, violate, result in the breach
or termination of, or constitute a default or give rise to any right of
termination or acceleration under any Contract, Permit or Order to which the
Company is a party or by which the Company or its assets or properties are
bound; (ii) constitute a violation of any Law applicable to the Company or (iii)
result in the creation of any Lien upon the properties or assets of the Company.
No consent, waiver, approval, Order, Permit or authorization of, or declaration
or filing with, or notification to, any Person or Governmental Body is required
on the part of the Company in connection with the execution and delivery of this
Agreement, or the compliance by the Company with any of the provisions hereof or
thereof, except as set forth on Schedule 4.1 of the Stock Purchase and Sale
Agreement dated the date hereof by and among the Company, Silverman and Robert
S. Trump.
8.3 Reservation of Shares. The Company has reserved for
issuance out of the authorized capital stock of the Company a number of shares
of the Company's common stock equal to the number of shares of the Company's
common stock issuable upon the exercise of the Option.
9. No Limitation on Rights of the Company. The grant of this
Option shall not in any way affect the right or power of the Company to make
adjustments, reclassifications, or changes in its capital or business structure
or to merge, consolidate, dissolve, liquidate, sell, or transfer all or any part
of its business or assets.
10. Rights as a Shareholder. The Grantee shall have the rights
of a shareholder with respect to the Shares covered by the Option only upon
becoming the holder of record of those Shares.
11. Compliance with Applicable Law. Notwithstanding anything
herein to the contrary, the Company shall not be obligated to cause to be issued
or delivered any certificates for Shares pursuant to the exercise of the Option,
unless and until the Company is advised by its counsel that the issuance and
delivery of such certificates is in compliance with all applicable laws,
regulations of governmental authority, and the requirements of any exchange upon
which Shares are traded. Absent any agreement with the Company specifically
providing for such terms, the Company shall in no event be obligated to register
any securities pursuant to the Securities Act of 1933 (as now in effect or as
hereafter amended). The Company hereby agrees to cause the issuance and delivery
of such certificates to comply with any such law, regulation or requirement from
and after the date hereof.
12. No Obligation to Exercise Option. The granting of the
Option shall impose no obligation upon the Grantee to exercise the Option.
13. Agreement Not a Contract of Employment. This Agreement is
not a contract of employment, and the terms of the Grantee's Board membership or
the relationship of the Grantee with the Company or any Affiliate shall not be
affected in any way by this Agreement except as specifically provided herein.
The execution of this Agreement shall not be construed as conferring any legal
rights upon the Grantee for a continuation as a member of the
3
<PAGE> 4
Board or of any other relationship between the Grantee and the Company or any
Affiliate, nor shall it interfere with the right of shareholders of the Company
to remove the Grantee from the Board or the right of the Company or any
Affiliate to treat the Grantee without regard to the effect which that treatment
might have upon him as a Grantee.
14. Certain Definitions.
"Affiliate" shall have the meaning specified in Rule 12b-2
under the Securities Exchange Act of 1934, as amended.
"Contract" means any contract, agreement, indenture, note,
bond, loan, instrument, lease, conditional sale contract, mortgage, license,
franchise, insurance policy, commitment or other arrangement or agreement,
whether written or oral.
"Governmental Body" means any governmental or regulatory
body, or political subdivision thereof, whether federal, state, local or
foreign, or any agency, instrumentality or authority thereof, or any court or
arbitrator (public or private).
"Law" means any federal, state, local or foreign law
(including common law), statute, code, ordinance, rule, regulation or other
requirement or guideline.
"Lien" means any lien, pledge, hypothecation, levy,
mortgage, deed of trust, security interest, claim, lease, charge, option, right
of first refusal, easement, or other real estate declaration, covenant,
condition, restriction or servitude, transfer restriction under any shareholder
or similar agreement, encumbrance or any other restriction or limitation
whatsoever.
"Order" means any order, consent, consent order,
injunction, judgment, decree, consent decree, ruling, writ, assessment or
arbitration award.
"Permit" means any approval, authorization, registration,
consent, license permit or certificate by any Governmental Body.
"Person" means any individual, corporation, partnership,
firm, joint venture, association, joint stock company, trust, unincorporated
organization, Government Body or other entity.
15. Notices. Any notice or other communication required or
permitted hereunder shall be in writing and shall be delivered personally or
sent by certified, registered, or express mail, postage prepaid. Any such notice
shall be deemed given when so delivered personally or, if mailed, four days
after the date of deposit in the United States mails, to each party at its
address set forth above or to such other address as may be designated in a
notice given in accordance with this Section.
16. Governing Law. Except to the extent preempted by Federal
law, this Agreement shall be construed and enforced in accordance with, and
governed by, the laws of the State of New York without regard to any rules
regarding conflicts of law.
4
<PAGE> 5
IN WITNESS WHEREOF, the Company and the Grantee have duly
executed this Stock Option Agreement as of the date first written above.
FINANCIAL PERFORMANCE CORPORATION
By:
--------------------------------
Name:
Title:
-----------------------------------
JEFFREY SILVERMAN
5
<PAGE> 1
Exhibit 10.11
FINANCIAL PERFORMANCE CORPORATION
STOCK OPTION AGREEMENT
STOCK OPTION AGREEMENT (the "Agreement"), dated as of November
17, 1999, between FINANCIAL PERFORMANCE CORPORATION, a New York corporation (the
"Company"), having an address at 335 Madison Avenue, 8th floor, New York, New
York 10017 and RONALD NASH, having an address at 650 Fifth Avenue, New York, NY
10019 (the "Grantee").
The Company hereby grants to the Grantee an irrevocable
nonqualified stock option (the "Option") to purchase from time to time all or
any part of an aggregate of 1,000,000 shares of the Company's common stock, $.01
par value per share (the "Shares"). This Option is a nonqualified Stock Option
which is not intended to be an "incentive stock option" within the meaning of
Section 422 of the Internal Revenue Code of 1986, as amended (the "Code").
To evidence the Option and to set forth its terms, the Company
and the Grantee agree as follows:
1. Confirmation of Grant. The Company hereby evidences and
confirms its grant of the Option to the Grantee on the date of this Agreement.
2. Number of Shares. This Option shall be for an aggregate of
1,000,000 Shares.
3. Exercise Price. The exercise price shall be $.43 per share,
which amount equals the closing sale price of the Company's common stock as
quoted on the OTC Bulletin Board as of the close of business on November 15,
1999.
4. Medium and Time of Payment. The exercise price of the
Option shall be paid in cash or by check payable to the order of the Company at
the time of exercise. In addition, the Company shall accept full or partial
payment in Shares previously owned by the Grantee having an aggregate fair
market value on the date of exercise equal to the portion of the exercise price
being so paid. The option may be partially exercised from time to time.
Payment in full for all Shares with respect to which the
Option is then being exercised shall be required before the issuance of any
Shares pursuant to the exercise of the Option. In connection with the delivery
of any certificates representing the Shares, the Company shall, at the request
of the Grantee, withhold a number of Shares having an aggregate fair market
value on the date of the exercise of the Option equal to the taxes then required
by applicable federal, state and local law to be so withheld and such shares
shall be irrevocably returned to treasury stock of the Company. If the Grantee
does not so request the Company to withhold Shares, the Grantee shall pay to the
Company any amount necessary to satisfy any applicable federal, state, or local
tax withholding obligations.
<PAGE> 2
5. Term and Exercise of the Option. The Option shall expire
five years from the date of this Agreement and may be exercised for all or any
portion of the Shares (in whole shares) at any time and from time to time during
such period.
This Option may be exercised only by written notice to the
Company indicating the number of whole Shares which are being purchased. Such
notice must be signed by the Grantee and be accompanied by full payment of the
exercise price.
6. Transferability. The Option may only be transferred to an
Affiliate of Grantee or by will or the laws of descent and distribution.
7. Adjustments. (a) In case the Company shall at any time
after the date of this Agreement (i) declare a dividend or make a distribution
on the Common Stock in shares of its capital stock, (ii) subdivide the
outstanding Common Stock; (iii) combine the outstanding Common Stock into a
smaller number of shares or (iv) issue any shares of its capital stock by
reclassification of the Common Stock (including any such reclassification in
connection with a consolidation or merger in which the Company is the continuing
corporation), or take any action similar to (i) through (iv), then the number
and kind of shares of capital stock purchasable upon exercise of the Option
immediately after the happening of such event shall be adjusted so that, after
giving effect to such adjustment, the Grantee shall be entitled to receive the
number and kind of shares of capital stock upon exercise that such holder would
have owned or been entitled to receive had such Option been exercised
immediately prior to the happening of the events described above (or in the case
of clause (i) above, immediately prior to the record date therefor). An
adjustment made pursuant to this Section 10(a) shall become effective
immediately after the effective date, retroactive to the record date therefor in
the case of clause (i) above, and shall become effective immediately after the
effective date in the case of clauses (ii), (iii) or (iv) above.
(b) In case of any consolidation or merger of the Company
with or into another corporation (other than a merger with a subsidiary in which
the Company is the continuing corporation and which does not result in any
reclassification, capital reorganization or other change of the outstanding
Shares issuable upon exercise of the Option) or in case of the sale, transfer or
other disposition of all or substantially all of the assets of the Company, then
the Grantee shall be entitled to receive upon exercise of the Option such number
of shares of capital stock or other securities or property upon, or as a result
of, such transaction that the Grantee would have been entitled to receive had
the Option been exercised immediately prior to such transaction.
8. Representations and Warranties of the Company. The Company
hereby represents and warrants to the Grantee as follows:
8.1 This Agreement has been duly and validly authorized,
executed and delivered by the Company. This Agreement constitutes the legal,
valid and binding obligations of the Company, enforceable against the Company in
accordance with its terms, subject, as to enforceability, to applicable
bankruptcy, insolvency, reorganization, moratorium and similar laws affecting
creditors' rights and remedies generally and to general principles of equity
(regardless of whether enforcement is sought in a proceeding at law or in
equity).
2
<PAGE> 3
8.2 No Conflicts; Consents of Third Parties. The execution
and delivery by the Company of this Agreement, the consummation of the
transactions contemplated hereby, and the compliance by the Company with any of
the provisions hereof does not (i) conflict with, violate, result in the breach
or termination of, or constitute a default or give rise to any right of
termination or acceleration under any Contract, Permit or Order to which the
Company is a party or by which the Company or its assets or properties are
bound; (ii) constitute a violation of any Law applicable to the Company or (iii)
result in the creation of any Lien upon the properties or assets of the Company.
No consent, waiver, approval, Order, Permit or authorization of, or declaration
or filing with, or notification to, any Person or Governmental Body is required
on the part of the Company in connection with the execution and delivery of this
Agreement, or the compliance by the Company with any of the provisions hereof or
thereof, except as set forth on Schedule 4.1 of the Stock Purchase and Sale
Agreement dated the date hereof by and among the Company, Nash and Robert S.
Trump.
8.3 Reservation of Shares. The Company has reserved for
issuance out of the authorized capital stock of the Company a number of shares
of the Company's common stock equal to the number of shares of the Company's
common stock issuable upon the exercise of the Option.
9. No Limitation on Rights of the Company. The grant of this
Option shall not in any way affect the right or power of the Company to make
adjustments, reclassifications, or changes in its capital or business structure
or to merge, consolidate, dissolve, liquidate, sell, or transfer all or any part
of its business or assets.
10. Rights as a Shareholder. The Grantee shall have the rights
of a shareholder with respect to the Shares covered by the Option only upon
becoming the holder of record of those Shares.
11. Compliance with Applicable Law. Notwithstanding anything
herein to the contrary, the Company shall not be obligated to cause to be issued
or delivered any certificates for Shares pursuant to the exercise of the Option,
unless and until the Company is advised by its counsel that the issuance and
delivery of such certificates is in compliance with all applicable laws,
regulations of governmental authority, and the requirements of any exchange upon
which Shares are traded. Absent any agreement with the Company specifically
providing for such terms, the Company shall in no event be obligated to register
any securities pursuant to the Securities Act of 1933 (as now in effect or as
hereafter amended). The Company hereby agrees to cause the issuance and delivery
of such certificates to comply with any such law, regulation or requirement from
and after the date hereof.
12. No Obligation to Exercise Option. The granting of the
Option shall impose no obligation upon the Grantee to exercise the Option.
13. Agreement Not a Contract of Employment. This Agreement is
not a contract of employment, and the terms of the Grantee's Board membership or
the relationship of the Grantee with the Company or any Affiliate shall not be
affected in any way by this Agreement except as specifically provided herein.
The execution of this Agreement shall not be construed as conferring any legal
rights upon the Grantee for a continuation as a member of the
3
<PAGE> 4
Board or of any other relationship between the Grantee and the Company or any
Affiliate, nor shall it interfere with the right of shareholders of the Company
to remove the Grantee from the Board or the right of the Company or any
Affiliate to treat the Grantee without regard to the effect which that treatment
might have upon him as a Grantee.
14. Certain Definitions.
"Affiliate" shall have the meaning specified in Rule 12b-2
under the Securities Exchange Act of 1934, as amended.
"Contract" means any contract, agreement, indenture, note,
bond, loan, instrument, lease, conditional sale contract, mortgage, license,
franchise, insurance policy, commitment or other arrangement or agreement,
whether written or oral.
"Governmental Body" means any governmental or regulatory
body, or political subdivision thereof, whether federal, state, local or
foreign, or any agency, instrumentality or authority thereof, or any court or
arbitrator (public or private).
"Law" means any federal, state, local or foreign law
(including common law), statute, code, ordinance, rule, regulation or other
requirement or guideline.
"Lien" means any lien, pledge, hypothecation, levy,
mortgage, deed of trust, security interest, claim, lease, charge, option, right
of first refusal, easement, or other real estate declaration, covenant,
condition, restriction or servitude, transfer restriction under any shareholder
or similar agreement, encumbrance or any other restriction or limitation
whatsoever.
"Order" means any order, consent, consent order,
injunction, judgment, decree, consent decree, ruling, writ, assessment or
arbitration award.
"Permit" means any approval, authorization, registration,
consent, license permit or certificate by any Governmental Body.
"Person" means any individual, corporation, partnership,
firm, joint venture, association, joint stock company, trust, unincorporated
organization, Government Body or other entity.
15. Notices. Any notice or other communication required or
permitted hereunder shall be in writing and shall be delivered personally or
sent by certified, registered, or express mail, postage prepaid. Any such notice
shall be deemed given when so delivered personally or, if mailed, four days
after the date of deposit in the United States mails, to each party at its
address set forth above or to such other address as may be designated in a
notice given in accordance with this Section.
16. Governing Law. Except to the extent preempted by Federal
law, this Agreement shall be construed and enforced in accordance with, and
governed by, the laws of the State of New York without regard to any rules
regarding conflicts of law.
4
<PAGE> 5
IN WITNESS WHEREOF, the Company and the Grantee have duly
executed this Stock Option Agreement as of the date first written above.
FINANCIAL PERFORMANCE CORPORATION
By:-------------------------------
Name:
Title:
----------------------------------
RONALD NASH
5
<PAGE> 1
Exhibit 10.12
REGISTRATION RIGHTS AGREEMENT
DATED AS OF
NOVEMBER 17, 1999
AMONG
FINANCIAL PERFORMANCE CORPORATION
AND
WILLIAM F. FINLEY,
ROBERT S. TRUMP,
JEFFREY SILVERMAN
AND
RONALD NASH
<PAGE> 2
<TABLE>
<CAPTION>
TABLE OF CONTENTS
PAGE
<S> <C>
ARTICLE I DEFINITIONS AND USAGE................................................................... 1
Section 1.1 Definitions........................................................................ 1
Section 1.2 Usage.............................................................................. 4
ARTICLE II DEMAND AND SHELF REGISTRATION STATEMENTS................................................ 5
Section 2.1 Demand Registration Statements..................................................... 5
Section 2.2 Shelf Registration Statements...................................................... 6
Section 2.3 Limitation on Demand Registration.................................................. 6
Section 2.4 Manner of Sale..................................................................... 7
Section 2.5 Withdrawal......................................................................... 7
ARTICLE III PIGGYBACK REGISTRATION STATEMENTS....................................................... 7
Section 3.1 Piggyback Registration Statements.................................................. 7
Section 3.2 Priority in Registrations.......................................................... 8
ARTICLE IV REGISTRATION PROCEDURES AND EXPENSES.................................................... 9
Section 4.1 Registration Procedures............................................................ 9
Section 4.2 Holders' Obligations............................................................... 12
Section 4.3 Registration Expenses.............................................................. 14
ARTICLE V INDEMNIFICATION AND CONTRIBUTION........................................................ 14
Section 5.1 Indemnification by the Company..................................................... 14
Section 5.2 Indemnification by the Selling Holders............................................. 15
Section 5.3 Notice of Claims, etc.............................................................. 15
Section 5.4 Contribution....................................................................... 16
Section 5.5 Survival........................................................................... 17
ARTICLE VI RULE 144 AND RULE 144A.................................................................. 17
Section 6.1 Reports, etc....................................................................... 17
Section 6.2 Rule 144 Information............................................................... 17
Section 6.3 Rule 144A Information.............................................................. 17
ARTICLE VII MISCELLANEOUS........................................................................... 17
Section 7.1 Amendment, Modification and Waivers; Further Assurances............................ 17
Section 7.2 Assignment......................................................................... 18
Section 7.3 Invalid Provisions................................................................. 18
</TABLE>
-i-
<PAGE> 3
TABLE OF CONTENTS
(CONTINUED)
<TABLE>
<CAPTION>
PAGE
<S> <C>
Section 7.4 Nominees for Beneficial Owners..................................................... 18
Section 7.5 Governing Law...................................................................... 19
Section 7.6 Notices............................................................................ 19
Section 7.7 Entire Agreement; Integration...................................................... 21
Section 7.8 Injunctive Relief.................................................................. 21
Section 7.9 Section Headings................................................................... 21
Section 7.10 Counterparts....................................................................... 21
Section 7.11 Filing............................................................................. 21
Section 7.12 Termination........................................................................ 22
Section 7.13 Attorneys' Fees.................................................................... 22
Section 7.14 No Third Party Beneficiaries....................................................... 22
Section 7.15 Requisite Holders.................................................................. 22
</TABLE>
-ii-
<PAGE> 4
REGISTRATION RIGHTS AGREEMENT
Registration Rights Agreement dated as of November 17, 1999 by and
among Financial Performance Corporation, a New York corporation (the "Company"),
William F. Finley ("Finley"), Robert S. Trump ("Trump"), Jeffrey Silverman
("Silverman") and Ronald Nash ("Nash").
RECITALS
WHEREAS, Finley is President, Chief Executive Officer, Principal
Financial Officer and a shareholder of the Company;
WHEREAS, the Company and Finley desire to set forth in this agreement
the registration rights which the Company will grant to Finley,
WHEREAS, Trump is a principal shareholder of the Company;
WHEREAS, Trump has entered into several registration rights agreements
with the Company and desires to set forth in one agreement, to supercede any and
all such prior registration rights agreements, all of the registration rights
granted to him by the Company; and
WHEREAS, as of the date hereof, Silverman and Nash have each become
directors of the Company and principal shareholders of the Company through their
purchase from Trump of an aggregate of 1,000,000 shares of common stock and
options to purchase an additional 2,500,000 shares of common stock of the
Company and the grant to them by the Company of options to purchase an aggregate
of 2,000,000 shares of common stock of the Company,
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto hereby agree as
follows:
ARTICLE I
DEFINITIONS AND USAGE
Section 1.1 Definitions. As used in this Agreement:
Affiliate. "Affiliate" shall mean (a) when used with reference to any
partnership, any Person that, directly or indirectly through one or more
intermediaries, owns or controls 10% or more of either the capital or profit
interests of such partnership or is a general partner of such partnership or is
a Person in which such partnership has a 10% or greater direct or indirect
equity interest, and (b) when used with reference to any corporation, any Person
that, directly or indirectly, owns or controls 10% or more of the outstanding
voting securities of such corporation or is a Person in which such corporation
has a 10% or greater direct or indirect equity interest. In addition, the term
"Affiliate," when used with reference to any Person, also means any other Person
that, directly or indirectly through one or more intermediaries, controls or is
controlled by
<PAGE> 5
or is under common control with such Person. As used in the preceding sentence,
(i) the term "control" means the possession, directly or indirectly, of the
power to direct or cause the direction of the management and policies of the
entity referred to, whether through ownership of voting securities, by contract,
or otherwise, and (ii) the terms "controlling" and "controls" shall have
meanings correlative to the foregoing.
Agreement. "Agreement" shall mean this Registration Rights Agreement,
as the same may be amended from time to time.
Commission. "Commission" shall mean the United States Securities and
Exchange Commission, or any successor governmental agency or authority thereto.
Common Stock. "Common Stock" shall mean (a) the common stock, par value
$0.01 per share, of the Company, and (b) shares of capital stock of the Company
issued by the Company in respect of or in exchange for shares of such common
stock in connection with any stock dividend or distribution, stock split-up,
recapitalization, recombination or exchange by the Company generally of shares
of such common stock.
Demand Registration Request. "Demand Registration Request" shall have
the meaning set forth in Section 2.1(a).
Demand Registration Statement. "Demand Registration Statement" shall
have the meaning set forth in Section 2.1(a).
Demanding Holders. "Demanding Holders" shall have the meaning set forth
in Section 2.1(a).
Exchange Act. "Exchange Act" shall mean the Securities Exchange Act of
1934, as amended, and the rules and regulations promulgated thereunder.
Holder or Holders. "Holders" shall mean each of Finley, Trump,
Silverman and Nash and any Person or Persons to whom the rights granted under
this Agreement are transferred by Finley, Trump, Silverman or Nash and the
Permitted Transferees (thereof of any such Transferee as defined in Section 7.2
hereof) pursuant to Section 7.2 hereof.
Person. "Person" shall mean any individual, corporation, partnership,
joint venture, association, joint-stock company, limited liability company,
trust, unincorporated organization or government or other agency or political
subdivision thereof.
Piggyback Registration Statement. "Piggyback Registration Statement"
shall have the meaning set forth in Section 3.1.
Register, Registered and Registration. "Register", "registered", and
"registration" shall refer to a registration effected by preparing and filing a
registration statement or similar document in compliance with the Securities
Act, and the declaration or ordering by the Commission of effectiveness of such
registration statement or document.
-2-
<PAGE> 6
Registrable Securities. "Registrable Securities" shall mean (a) the
shares of Common Stock beneficially owned (as determined under Rule 13d-3 under
the Exchange Act) by the Holders on the date hereof; (b) any shares of Common
Stock or other securities issued to the Holders as (or issuable upon the
conversion or exercise of any warrant, right or other security which is issued
as) a dividend or other distribution with respect to, or in exchange by the
Company generally for, or in replacement by the Company generally of, such
shares of Common Stock; and (c) any securities issued in exchange for shares of
Common Stock beneficially owned by a Holder on the date hereof in any merger,
recapitalization or reorganization of the Company. As to any particular
Registrable Securities, once issued, such securities will cease to be
Registrable Securities (a) when a registration statement with respect to the
resale of such securities has become effective under the Securities Act and such
securities shall have been disposed of in accordance with the plan of
distribution set forth in such registration statement; (b) when such securities
have been transferred pursuant to Rule 144 to a third party who is not an
Affiliate of the Company, and new certificates evidencing such securities
without legends restricting further transfer have been delivered by the Company,
and the Holders have received an opinion of Company counsel that, in the opinion
of such counsel, subsequent public distribution of such securities requires
neither registration under the Securities Act or qualification (or any similar
filing) under any state securities or blue sky law then in effect nor the use of
an applicable exemption from such registration qualification; or (c) in the
event such Holder is not an Affiliate of the Company, when all of a Holder's
otherwise Registrable Securities may be immediately sold without registration
under the Securities Act pursuant to Rule 144 without any restrictions under
Rule 144(k).
Registration Expenses. "Registration Expenses" shall mean all expenses
incident to the Company's performance of, or compliance with, this Agreement,
including, without limitation, (a) all registration, filing, securities exchange
listing, rating agency and National Association of Securities Dealers, Inc.
fees, (b) all registration, filing, qualification and other fees and expenses of
complying with securities or blue sky laws of all jurisdictions in which the
securities are to be registered and the reasonable legal fees and expenses
incurred in connection with the blue sky qualifications of the Registrable
Securities and the determination of their eligibility for investment under the
laws of all such jurisdictions, (c) all word processing, duplicating, printing,
messenger and delivery expenses incurred by the Company, (d) the fees and
disbursements of counsel for the Company and of its independent public
accountants, including, without limitation, the expenses of any special audits
or "cold comfort" letters required by or incident to such performance and
compliance, (e) the reasonable fees and disbursements incurred for one counsel
or firm of counsel selected by the Requisite Holders of the Registrable
Securities, (f) premiums and other costs of policies of insurance against
liabilities arising out of the public offering of the Registrable Securities
being registered to the extent the Company elects to obtain such insurance, (g)
any fees and disbursements of underwriters customarily paid by issuers or
sellers of securities (but excluding underwriting discounts, concessions,
allowances and commissions and transfer taxes, if any, relating to the
Registrable Securities being registered), and (h) fees and expenses of other
Persons retained or employed by the Company.
Requisite Holders. "Requisite Holders" shall mean any Selling Holder or
Selling Holders of a majority in interest of the Registrable Securities
requested to be included in a registration or other relevant action, as the case
may be.
-3-
<PAGE> 7
Rule 144. "Rule 144" shall mean Rule 144 promulgated by the Commission
under the Securities Act, and any successor provision thereto.
Rule 144A. "Rule 144A" shall mean Rule 144A promulgated by the
Commission under the Securities Act, and any successor provision thereto.
Securities Act. "Securities Act" shall mean the Securities Act of 1933,
as amended, and the rules and regulations promulgated thereunder.
Selling Holders. "Selling Holders" shall mean, with respect to a
specified registration pursuant to this Agreement, Holders whose Registrable
Securities are included in such registration.
Shelf Registration Statement. "Shelf Registration Statement" shall have
the meaning set forth in Section 2.2(a).
Transfer. "Transfer" shall mean and include the act of selling, giving,
transferring, creating a trust (voting or otherwise), assigning or otherwise
disposing of (other than pledging, hypothecating or otherwise transferring as
collateral security for an underlying obligation) (and correlative words shall
have correlative meanings); provided, however, that any transfer or other
disposition upon foreclosure or other exercise of remedies of a secured creditor
after an event of default under or with respect to a pledge, hypothecation or
other transfer as collateral security shall constitute a "Transfer."
Underwriters' Representative. "Underwriters' Representative" shall mean
the managing underwriter, or, in the case of a co-managed underwriting, the lead
manager, within the meaning of Rule 12b-2 under the Exchange Act.
Violation. "Violation" shall have the meaning set forth in Section 5.1.
Section 1.2 Usage. (a) References to a Person are also references to
its assigns and successors in interest (by any means whatever, including merger,
consolidation or sale of all or substantially all of the assets of such Person
or otherwise, as the case may be).
(b) References to Registrable Securities "owned" by a Holder shall
include Registrable Securities beneficially owned by such Person but which are
held of record in the name of a nominee, trustee, custodian, or other agent, but
shall exclude shares of Common Stock held by a Holder in a fiduciary capacity
for customers of such Person.
(c) References to a document are to it as amended, waived and otherwise
modified from time to time and references to a statute or other governmental
rule are to it as amended and otherwise modified from time to time (and
references to any provision thereof shall include references to any successor
provision).
(d) References to Sections, Articles or Schedules are to sections or
articles hereof or schedules hereto, unless the context otherwise requires.
-4-
<PAGE> 8
(e) The definitions set forth herein are equally applicable both to the
singular and plural forms and the feminine, masculine and neuter forms of the
terms defined.
(f) The term "including" and correlative terms shall be deemed to be
followed by "without limitation" whether or not followed by such words or words
of like import.
(g) The "date of" any notice or request given pursuant to this
Agreement shall be determined in accordance with Section 7.6.
ARTICLE II
DEMAND AND SHELF REGISTRATION STATEMENTS
Section 2.1 Demand Registration Statements. (a) At any time during the
period commencing on the date hereof and ending on the fifth anniversary hereof,
a Holder (the "Demanding Holder") may at his option make a written request (a
"Demand Registration Request") to the Company requesting that the Company file
with the Commission a registration statement on an appropriate form under the
Securities Act (a "Demand Registration Statement") to register all or such
number of such Demanding Holder's Registrable Securities as the Demanding Holder
shall request in writing; provided, however, that no request may be made
pursuant to this Section 2.1 unless the Demanding Holder requests that at least
250,000 shares of Registrable Securities be included in the Demand Registration
Statement. Upon receipt of a Demand Registration Request, the Company shall
promptly give written notice of such proposed registration to all other Holders
known to the Company. Such Holders shall have the right, by giving written
notice to the Company within fifteen (15) days after the Company provides its
notice, to elect to have included in such registration such number of their
Registrable Securities as such Holders may request in such notice. Each Holder
may, at any time up to five (5) business days before the filing date of the
applicable Registration Statement relating to the Demand Registration, request
that his Registrable Securities not be included therein by providing a written
notice to that effect to the Company. The Company shall not be obligated to file
the Demand Registration Statement if, after giving effect to any such
withdrawal(s) from one or more Holders, the Demand Registration Statement does
not include at least 250,000 shares of Common Stock constituting Registrable
Securities.
After an effective Demand Registration Request is made, the Company
shall, as soon as reasonably practicable but in any event within 60 days of the
date of such Demand Registration Request (unless the Company's financial
statements would otherwise be "stale" under Rule 3-12 of Regulation S-X), file
with the Commission the Demand Registration Statement. Any Demand Registration
Statement shall provide for an underwritten offering (whether on a "firm," "best
efforts" or "all reasonable efforts" basis or otherwise) or an offering on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act. Any
Demand Registration Request made pursuant to this Section 2.1 shall be addressed
to the attention of the President of the Company and shall specify the number of
Registrable Securities to be registered, the intended methods of disposition
thereof and that the request is for a Demand Registration Statement pursuant to
this Section 2.1. The Company shall use its reasonable best efforts to keep any
Demand Registration
-5-
<PAGE> 9
Statement continuously effective for a period of one year following the
effective date thereof, or such shorter period ending on the earlier of (i) when
all Registrable Securities covered by such Registration Statement have been sold
or (ii) if none of the Holders of Registrable Securities included in such
Registration Statement are Affiliates of the Company, the first date when all
Registrable Securities covered by the Registration Statement may be immediately
sold without registration under the Securities Act pursuant to the exemptions
provided by Rule 144 under the Securities Act and without restriction under Rule
144(k), subject to the provisions of Article IV hereof.
(b) The Company shall be entitled to postpone for up to 90 days the
filing of any Demand Registration Statement otherwise required to be prepared
and filed pursuant to this Section 2.1 if (i) the Board of Directors of the
Company determines, in its good faith reasonable judgment, that such
registration and the Transfer of Registrable Securities contemplated thereby
would materially interfere with, or require the premature disclosure of, any
financing, securities purchase, acquisition or reorganization or other material
transaction involving the Company or any of its subsidiaries or would otherwise
require the premature disclosure of any other material nonpublic information as
to which the Company has a bona fide business purpose for maintaining its
confidentiality, and (ii) the Company promptly gives the Demanding Holders
notice of such determination (which notice need not disclose the fact, event or
information); provided, however, that the Company shall not have, within the 12
months prior to the date of the postponement, postponed pursuant to this Section
2.1(b) the filing of any other Demand Registration Statement covering such
Holder's Registrable Securities that was subsequently abandoned because the
Demand Registration Request relating thereto was withdrawn.
Section 2.2 Shelf Registration Statements. As soon as practicable but
no later than 120 days after the date hereof, the Company shall file with the
Commission a registration statement on Form SB-2, S-1 or Form S-3 (if use of
such form is then available) or such other appropriate form in accordance with
the Securities Act for an offering or offerings by the Holders of the
Registrable Securities on a delayed or continuous basis pursuant to Rule 415
under the Securities Act (each, a "Shelf Registration Statement"). The Company
shall use its reasonable best efforts to have such Shelf Registration Statement
declared effective within 180 days following the filing of the registration
statement. Subject to compliance with the provisions of Section 4.2, each Holder
shall be entitled to have all or a portion of such Holder's Registrable
Securities included in the applicable Shelf Registration Statement. The Company
shall use its reasonable best efforts to keep such Shelf Registration Statement
continuously effective for a period of 270 days following the effective date
thereof, or such shorter period ending on the earlier of (i) when all
Registrable Securities covered by such Registration Statement have been sold or
(ii) if none of the Holders of Registrable Securities included in such
Registration Statement are Affiliates of the Company, the first date when all
Registrable Securities covered by the Registration Statement may be immediately
sold without registration under the Securities Act pursuant to the exemptions
provided by Rule 144 under the Securities Act and without restriction under Rule
144(k), subject to the provisions of Article IV hereof.
Section 2.3 Limitation on Demand Registration. The Company shall be
obligated to effect no more than three (3) Demand Registration Statements for
each Holder of the Registrable
-6-
<PAGE> 10
Securities. For purposes of the preceding sentence, a Demand Registration
Statement shall not be deemed to have been effected as to a Holder's Registrable
Securities (a) unless a registration statement with respect thereto has become
effective, (b) if after such registration statement has become effective, such
registration or the related offer, sale or distribution of such Holder's
Registrable Securities thereunder is interfered with by any stop order,
injunction or other order or requirement of the Commission or other governmental
agency or court for any reason not attributable to such Selling Holder and such
interference is not thereafter eliminated, or (c) if the conditions to closing
specified in any underwriting agreement containing usual and customary terms
entered into in connection with such registration are not satisfied or waived,
other than by reason of a failure on the part of such Selling Holder. The
Company's obligation to effect a given Demand Registration pursuant to Section
2.1 shall be deemed to have been satisfied upon the earlier of (i) the date as
of which all of the Registrable Securities included therein shall have been
sold, and (ii) the date as of which such Demand Registration Statement shall
have been continuously effective for a period of one year or such shorter period
as provided in Article IV.
Section 2.4 Manner of Sale. The Demanding Holder shall, in connection
with a Demand Registration Statement, be entitled, in his sole and absolute
discretion, to select the manner in which his Registrable Securities are sold,
including, but not limited to, the selection of underwriters or brokers through
whom such securities will be sold and the purchasers for such securities,
subject solely in the case of underwriters, to the Company's prior approval of
such underwriters or brokers, which approval shall not be unreasonably withheld
or delayed. In connection therewith, the Company shall take such actions as are
reasonably requested by such underwriters or brokers in order to facilitate the
registration and disposition of the Registrable Securities in accordance with
this Agreement, including, but not limited to, cooperating in the performance of
any reasonable due diligence investigation by a Holder or a Holder's
representative or any underwriter, including making available for inspection and
discussion, respectively, necessary corporate documents and records and company
personnel, subject to the receipt, where reasonably requested, of an executed
confidentiality agreement in a form reasonably satisfactory to the Company.
Section 2.5 Withdrawal. Any Holder participating in a registration
pursuant to this Agreement shall be permitted to withdraw all or part of its
Registrable Securities from such registration at any time (but not later than
two business days) prior to the effective date of the registration statement
covering such securities; provided that, in the event of a withdrawal from a
registration effected pursuant to Section 2.1 hereof, such registration shall be
deemed to have been effected for purposes of the first sentence of Section 2.3
hereof (subject to any otherwise applicable provisions in Section 2.3 hereof).
ARTICLE III
PIGGYBACK REGISTRATION STATEMENTS
Section 3.1 Piggyback Registration Statements. (a) If at any time the
Company proposes to register equity securities or securities convertible or
exchangeable into equity securities under the Securities Act in connection with
a public offering solely for cash (other than
-7-
<PAGE> 11
by a registration on Form S-4 or S-8 or any successor or similar forms or filed
in connection with an exchange offer or any offering of securities solely to the
Company's existing stockholders or otherwise pursuant to a dividend reinvestment
plan or a dividend reinvestment and stock purchase plan, and other than pursuant
to Article II), the Company shall promptly give each Holder of Registrable
Securities written notice of such proposed registration (a "Piggyback
Registration Statement"). Upon the written request of a Holder receiving such
notice given within 20 days following the date of such notice (which request
shall state the number of Registrable Securities to be registered and the
intended method of distribution of such Registrable Securities), the Company
shall cause to be included in such registration statement and use its reasonable
best efforts to have registered under the Securities Act all the Registrable
Securities that each such Holder shall have requested to be registered;
provided, however, that the Company shall have the right to postpone or withdraw
any registration (in its entirety) effected pursuant to this Section 3.1 without
obligation or liability to any Holder, subject to Section 3.1(b) hereof.
(b) If at any time after giving written notice of its intention to
register any of its securities pursuant to Section 3.1(a), and prior to the
effective date of the Piggyback Registration Statement filed in connection with
such Registration, the Company shall determine for any reason not to register or
to delay the Registration of such securities, the Company shall give written
notice of such determination to each Holder of Registrable Securities
contemplated to be included in such registration. If the Company shall elect not
to register such securities, the Company shall be relieved of its obligation to
register any Registrable Securities in connection therewith (but not from its
obligation, if any, to pay the Registration Expenses in connection therewith),
provided however, that in no event may the Company include in a Piggyback
Registration Statement the Registrable Securities of one requesting Holder and
exclude therefrom the Registrable Securities of the other requesting Holder,
unless the excluded Holder is not in compliance with the terms hereof. In the
event of an election by the Company not to register such securities, such
non-registration shall not count as an exercised piggyback registration right
pursuant to this Section 3.1 hereof.
(c) Until the fifth anniversary of the date hereof, each Holder shall
be entitled to have its Registrable Securities included in an unlimited number
of Piggyback Registration Statements pursuant to this Section 3.1.
Section 3.2 Priority in Registrations. (a) If the Company's offering
pursuant to which a Piggyback Registration Statement is proposed to be filed is
underwritten, the Holders shall sell the Registrable Securities to be sold
pursuant to such offering to or through the underwriter or underwriters of the
securities being registered for the account of the Company upon terms generally
comparable to the terms applicable to the Company and substantially identical to
those for the account of the other Holders, and if the lead underwriter
reasonably determines in writing to be provided to the Holders that the number
of securities included in the registration statement exceeds the number (the
"Saleable Number") that can be sold in an orderly fashion within a price range
reasonably acceptable to the Company, then the number of securities that the
Company and the Holders will be permitted to include in such Registration
Statement will be allocated as follows: (i) first, all the securities to be sold
by the Company for its own account pursuant to
-8-
<PAGE> 12
Section 3.1(a), and (ii) second, the difference between the Saleable Number and
the number, if any, to be included pursuant to clause (i) hereof, such amount to
be allocated among the Holders pro rata on the basis of the relative number of
Registrable Securities held by each of them.
(b) If as a result of the proration provisions of this Section 3.2, any
Holder of Registrable Securities is not entitled to include all such Registrable
Securities in such registration (a "Cutback"), such Holder may, on written
notice to the Company given at least two business days prior to the effective
date of the applicable registration statement, elect to withdraw his, her or its
request to include any Registrable Securities in such registration (a
"Withdrawal Election"); provided, however, that a Withdrawal Election shall be
irrevocable and any Holder of Registrable Securities who has made a Withdrawal
Election shall no longer have any right to include any Registrable Securities in
the registration as to which such Withdrawal Election was made. The number of
securities required to satisfy any underwriters' overallotment option shall be
allocated pro rata among the Company and all Holders on the basis of the
relative number of securities otherwise to be included by each of them in the
registration.
ARTICLE IV
REGISTRATION PROCEDURES AND EXPENSES
Section 4.1 Registration Procedures. Whenever required under Article II
or Article III to effect the registration of any Registrable Securities, the
Company shall, as expeditiously as practicable (but subject to the periods set
forth in Sections 2.1(a) and 2.2):
(a) Prepare and file with the Commission a registration statement with
respect to such Registrable Securities and use the Company's reasonable best
efforts to cause such registration statement to become effective, in each
instance giving due regard to the need to prepare current financial statements,
conduct due diligence and complete other actions that are reasonably necessary
to effect a registered public offering.
(b) Use the Company's reasonable best efforts to keep the relevant
Demand Registration Statement continuously effective for one year, or Shelf
Registration Statement continuously effective for 270 days, from the effective
date thereof or such shorter period ending on the earlier of (i) when all
Registrable Securities covered by such Registration Statement have been sold, or
(ii) if none of the Holders of Registrable Securities included in such
Registration Statement are Affiliates of the Company, the first date when all
Registrable Securities covered by the Registration Statement may be immediately
sold without registration under the Securities Act pursuant to the exemptions
provided by Rule 144 under the Securities Act, without restriction under Rule
144(k). As soon as reasonably practicable after the occurrence of any fact or
event that makes untrue any statement of a material fact made in the Shelf
Registration Statement or that requires the making of any additions to or
changes in the Shelf Registration Statement in order to make the statements
therein, in light of the circumstances in which they were made, not misleading,
the Company shall prepare and file a supplement or amendment to the Shelf
Registration Statement or related prospectus, or a document incorporated therein
by reference, so that such Shelf Registration Statement and related prospectus
shall not contain any
-9-
<PAGE> 13
such untrue statement of a material fact or any such omission of a material
fact; provided, however, that if the Board of Directors of the Company
determines, in its good faith reasonable judgment, that the Transfer of
Registrable Securities pursuant to the Shelf Registration Statement would
materially interfere with, or require the premature disclosure of, any
financing, acquisition or reorganization involving the Company or any of its
subsidiaries or otherwise would require premature disclosure of any other
material nonpublic information as to which the Company has a bona fide business
purpose for maintaining its confidentiality, then for so long as such
circumstances or such business purpose continues to exist (provided that, the
number of days of any such suspension may not exceed an aggregate of 120 days in
any 360-day period), the Company shall not be required to prepare or file any
such supplement, amendment or document.
(i) Each Holder agrees, by acquisition of a Registrable Security, that,
upon receipt of any notice from the Company of the existence of any fact or
event of the kind described in Section 2.1(b) or 4.1(b) (which notice need not
disclose the fact, event or information), such Holder will forthwith discontinue
the disposition of any Registrable Securities pursuant to the Demand
Registration Statement or Shelf Registration Statement, as the case may be,
until such Holder's receipt of the copies of a supplemented or amended
prospectus as contemplated by Section 4.1(b), or until it is advised in writing
by the Company that the use of the prospectus related to such Demand
Registration Statement or Shelf Registration Statement may be resumed, and has
received copies of any additional or supplemental filings that are incorporated
by reference in such prospectus. If so directed by the Company, each Holder will
deliver to the Company all copies, other than permanent file copies then in such
Holder's possession, of the prospectus covering such Registrable Securities that
was current at the time of receipt of such notice. Any such notice or writing of
the Company, or prospectus supplement or amendment, shall be delivered
simultaneously to all Holders of Registrable Securities included in such
registration statement.
(ii) Notwithstanding the foregoing, if, in the case of a Demand
Registration Statement, the filing of a registration statement is postponed as
permitted by Section 2.1(b), or, in the case of a Shelf Registration Statement,
the preparation and filing of a supplement, amendment or incorporated document
is postponed as permitted by Section 4.1(b), or in the case of a Piggyback
Registration Statement, the filing of a registration statement is postponed as
permitted by Section 3.1(b), the five-year period for filing a Demand
Registration Statement or a Piggyback Registration Statement or the 270-day
period of effectiveness of the Shelf Registration Statement, as the case may be,
shall be extended by the aggregate number of days of such postponement.
(c) Prepare and file with the Commission such amendments, supplements or
incorporated documents to such registration statement and the prospectus used in
connection with such registration statement as may be necessary to comply with
the provisions of the Securities Act with respect to the disposition of all
securities covered by such registration statement. If the registration statement
is for an underwritten offering, the Company shall amend the registration
statement or supplement the prospectus whenever required by the terms of the
underwriting agreement entered into pursuant to Section 4.1(f). In the event
that any Registrable Securities included in a registration statement subject to,
or required by, this Agreement remain
-10-
<PAGE> 14
unsold at the end of the period during which the Company is obligated to use its
reasonable best efforts to maintain the effectiveness of such registration
statement, the Company may file a post-effective amendment to the registration
statement for the purpose of removing such securities from registered status.
(d) Furnish to each Selling Holder of Registrable Securities copies of the
registration statement, any pre-effective or post-effective amendment thereto,
the prospectus, including each preliminary prospectus and any amendments or
supplements thereto, in each case in conformity with the requirements of the
Securities Act.
(e) Use the Company's reasonable best efforts (i) to register and qualify
the securities covered by such registration statement under the securities or
Blue Sky laws of such states or jurisdictions as shall be reasonably requested
by the Underwriters' Representative (or if inapplicable, the Requisite Holders),
and (ii) to obtain the withdrawal of any order suspending the effectiveness of a
registration statement, or the lifting of any suspension of the qualification
(or exemption from qualification) of the offer and transfer of any of the
Registrable Securities in any jurisdiction, at the earliest practicable moment;
provided, however, that the Company shall not be required in connection
therewith or as a condition thereto to qualify to do business, subject itself to
taxation or to file a general consent to service of process in any states or
jurisdictions where it is not now so subject.
(f) In the event of a Demand Registration Statement, enter into and
perform the Company's obligations under an underwriting or agency agreement
(including indemnification and contribution obligations of underwriters or
agents), in usual and customary form, with the managing underwriter or
underwriters of or agents for such offering. The Company shall also cooperate
with the Requisite Holders and the Underwriters' Representative for such
offering in the marketing of the Registrable Securities, including making
reasonably available the Company's officers, accountants, counsel, premises, and
books and records for such purpose.
(g) Promptly notify each Selling Holder of any stop order issued or
threatened to be issued by the Commission in connection therewith (and take all
actions required to prevent the entry of such stop order or to remove it if
entered).
(h) Make generally available to the Company's security holders an earnings
statement satisfying the provisions of Section 11(a) of the Securities Act no
later than 90 days following the end of the 12-month period beginning with the
first month of the Company's first fiscal quarter commencing after the effective
date of each registration statement filed pursuant to this Agreement.
(i) Make reasonably available for inspection by any Selling Holder, any
underwriter participating in such offering and the representatives of such
Selling Holder and Underwriter, all financial and other information as shall be
reasonably requested by them, and provide each Selling Holder, any underwriter
participating in such offering and the
-11-
<PAGE> 15
representatives of such Selling Holder and Underwriter the opportunity to
discuss the business affairs of the Company with its principal executives and
independent public accountants who have certified the audited financial
statements included in such registration statement, in each case to the extent
necessary to enable them to exercise their due diligence responsibility under
the Securities Act; provided, however, that information that the Company
determines, in good faith, to be confidential and which the Company advises such
Person in writing, is confidential, shall not be disclosed unless such Person
signs a confidentiality agreement reasonably satisfactory to the Company.
(j) In the event of a Demand Registration Statement, use the Company's
reasonable best efforts to obtain a "comfort letter" from its independent public
accountants and legal opinions of counsel to the Company addressed to each of
the Selling Holders and each underwriter or agent, in customary form and
covering such matters of the type customarily covered by such letters and in a
form that shall be reasonably satisfactory to the Selling Holders and the
Underwriters' Representative. The Company shall furnish to each Selling Holder
and each underwriter or agent a signed counterpart of any such comfort letter or
legal opinion. Delivery of any comfort letter shall be subject to the recipient
furnishing such written representations or acknowledgments as are customarily
provided by selling stockholders, underwriters or agents who receive such
comfort letters under SAS No. 72. Nothing in the immediately preceding sentence
shall be deemed to require a Selling Holder, underwriter or agent to make
representations and warranties if the Selling Holder, underwriter or agent is
willing to receive a letter in the form to be provided to selling stockholders,
underwriters or agents not making representations and warranties under SAS No.
76.
(k) 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.
(l) Use all reasonable efforts to cause the Registrable Securities, if the
Common Stock is then listed on a national securities exchange or included for
quotation in a recognized trading market, to continue to be so listed or
included to ensure that the Registrable Securities are freely tradeable thereon.
(m) Provide a CUSIP number for all Registrable Securities covered by such
registration statement not later than the effective date of such registration
statement.
Section 4.2 Holders' Obligations. (a) Each Selling Holder shall:
(i) furnish to the Company such information regarding such Selling
Holder and its affiliates, the number of Registrable Securities owned and
proposed to be sold by it, the intended method of disposition of such securities
and any other information as shall be required to effect the registration of
such Selling Holder's Registrable Securities, and cooperate with the Company in
preparing such registration statement and in complying with the requirements of
the Securities Act;
-12-
<PAGE> 16
(ii) agree to sell its Registrable Securities to the underwriters at
the same price and on substantially the same terms and conditions as the Company
or the other Persons on whose behalf the registration statement was being filed
have agreed to sell their securities, and execute the underwriting agreement
agreed to by the Company and customary custody arrangements, lock-up letters,
indemnities, questionnaires and other documents reasonably required by the
underwriters or agents; provided, however, that the lock-up period for each
Selling Holder shall be the same.
(b) In the event that a Demand Registration Statement or a Piggyback
Registration Statement becomes effective, if and to the extent requested by the
managing underwriter or lead agent for the offering relating thereto, no Holder
shall offer, sell or agree to sell or otherwise dispose of or transfer any
Registrable Securities or securities convertible into or exchangeable or
exercisable for any Registrable Securities (other than, in the case of the
Selling Holders under the Demand Registration Statement or Piggyback
Registration Statement, pursuant to such Demand Registration Statement or
Piggyback Registration Statement, as the case may be), or exercise any right to
register any such securities, during the period commencing ten days prior to the
anticipated effective date of such registration statement and ending 90 days
from the effective date of such registration statement. In order to enforce the
foregoing agreement, the Company shall be entitled to impose stop-transfer
instructions with respect to the Registrable Securities of each Holder until the
end of such period.
(c) Each Selling Holder of Registrable Securities agrees that, upon
receipt of any notice from the Company of (i) any request by the Commission for
amendments or supplements to a Registration Statement or related prospectus
covering any of such Selling Holder's Registrable Securities, (ii) the issuance
by the Commission of any stop order suspending the effectiveness of a
registration statement covering any of such Selling Holder's Registrable
Securities or the initiation of any proceedings for that purpose, (iii) the
receipt by the Company of any notification with respect to the suspension of the
qualification of any Registrable Securities for sale in any jurisdiction or the
initiation or threatening of any proceeding for such purpose, (iv) the happening
of any event that requires the making of any changes in the registration
statement covering any of such Selling Holder's Registrable Securities so that
it will not contain any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary to make the statements
therein not misleading or that any related prospectus will not contain any
untrue statement of a material fact or omit to state any material fact necessary
in order to make the statements therein, in light of the circumstances under
which they were made, not misleading, and (v) the Company's good faith
reasonable determination that a post-effective amendment to a registration
statement covering any of such Selling Holder's Registrable Securities or a
supplement to any related prospectus is required under the Securities Act; such
Selling Holder will forthwith discontinue disposition of such Registrable
Securities until it is advised in writing by the Company that the use of the
applicable prospectus (as amended or supplemented, as the case may be) and
disposition of the Registrable Securities covered thereby pursuant thereto may
be resumed; provided, however, (x) that such Selling Holder shall not resume its
disposition of Registrable Securities pursuant to such registration statement or
related prospectus unless it has received notice from the Company that such
registration statement or amendment has become effective under the Securities
Act and
-13-
<PAGE> 17
has received a copy or copies of the related prospectus (as then amended or
supplemented, as the case may be) unless the Registrable Securities are then
listed on a national securities exchange and the Company has advised such
Selling Holder that the Company has delivered copies of the related prospectus,
as then amended or supplemented, in transactions effected upon such exchange,
subject to any subsequent receipt by such Selling Holder from the Company of
notice of any of the events contemplated by clauses (i) through (v) of this
paragraph, and (y) if so directed by the Company, such Selling Holder will
deliver to the Company all copies, other than permanent file copies then in such
Selling Holder's possession, of the prospectus covering such Registrable
Securities current at the time of receipt of such notice.
Section 4.3 Registration Expenses. Expenses in connection with
registrations pursuant to this Agreement shall be allocated and paid as follows:
(a) With respect to each Shelf Registration Statement and Demand
Registration Statement, the Company shall bear and pay all of the Registration
Expenses incurred in connection with the registration and offering of
Registrable Securities with respect to such Shelf Registration Statement or
Demand Registration Statement, as the case may be; provided, however, that the
Selling Holders shall pay (i) underwriting discounts and commissions relating to
the Registrable Securities sold by them pursuant to any such registration
statement and (ii) all fees and disbursements of any additional counsel not
required to be paid by the Company and any other advisors to the Selling
Holders.
(b) The Company shall bear and pay all Registration Expenses incurred in
connection with any Piggyback Registration Statements pursuant to Article III,
other than (i) underwriting discounts and commissions relating to Registrable
Securities, (ii) the portion of any filing fees allocable to the Registrable
Securities included in such registration by the Selling Holders, and (iii) the
fees and disbursements of any additional counsel not required to be paid by the
Company and other advisors to the Selling Holders (each of which expenses in
clauses (i) and (ii) shall be paid on a pro rata basis by the Selling Holders of
Registrable Securities included in such Piggyback Registration Statement and
which expenses in clause (iii) shall be paid on a pro rata basis by the Selling
Holders for which the expenses are incurred).
ARTICLE V
INDEMNIFICATION AND CONTRIBUTION
Section 5.1 Indemnification by the Company. If any Registrable Securities
are included in a registration statement under this Agreement, to the extent
permitted by applicable law, the Company shall indemnify and hold harmless each
Selling Holder, its directors, officers, shareholders, employees, investment
advisors, agents and Affiliates, either direct or indirect (and each such
Affiliate's directors, officers, shareholders, employees, investment advisors
and agents) and each other Person, if any, who controls such Selling Holder
(within the meaning of the Securities Act) against any and all losses, claims,
damages, liabilities and expenses, including attorneys' fees and disbursements
and expenses of investigation, incurred by such party pursuant to any actual or
threatened action, suit, proceeding or investigation, to which any of the
-14-
<PAGE> 18
foregoing Persons may become subject under the Securities Act, the Exchange Act
or other federal or state laws, insofar as such losses, claims, damages,
liabilities and expenses arise out of or are based upon any untrue statement or
alleged untrue statement of a material fact contained in such registration
statement, including any preliminary prospectus or final prospectus contained
therein, or any amendments or supplements thereto, or the omission or alleged
omission to state therein a material fact required to be stated therein, or
necessary to make the statements therein not misleading (collectively, a
"Violation"); provided, however, that the indemnification required by this
Section 5.1 shall not apply to amounts paid in settlement of any such loss,
claim, damage, liability or expense if such settlement is effected without the
consent of the Company (which consent shall not be unreasonably withheld), nor
shall the Company be liable in any such case for any such loss, claim, damage,
liability or expense to the extent that it arises out of or is based upon a
Violation which occurs in reliance upon and in conformity with written
information furnished to the Company by the indemnified party expressly for use
in connection with such registration.
Section 5.2 Indemnification by the Selling Holders. If any Registrable
Securities are included in a registration statement under this Agreement, to the
extent permitted by applicable law, each Selling Holder (severally and not
jointly) shall indemnify and hold harmless the Company, its directors, officers,
shareholders, employees, investment advisors, agents and Affiliates, either
direct or indirect (and each such Affiliate's directors, officers, shareholders,
employees, investment advisors and agents) and each other Person, if any, who
controls the Company within the meaning of the Securities Act, any other Selling
Holder and any controlling Person of any such other Selling Holder against any
and all losses, claims, damages, liabilities and expenses, including attorneys'
fees and disbursements and expenses of investigation, incurred by such party
pursuant to any actual or threatened action, suit, proceeding or investigation,
to which any of the foregoing Persons may otherwise become subject under the
Securities Act, the Exchange Act or other federal or state laws, insofar as such
losses, claims, damages, liabilities and expenses arise out of or are based upon
any Violation, in each case to the extent (and only to the extent) that such
Violation occurs in reliance upon and in conformity with written information
furnished by such Selling Holder expressly for use in connection with such
registration statement; provided, however, that (a) the indemnification required
by this Section 5.2 shall not apply to amounts paid in settlement of any such
loss, claim, damage, liability or expense if settlement is effected without the
consent of the relevant Selling Holder of Registrable Securities, which consent
shall not be unreasonably withheld, (b) in no event shall the amount of any
indemnity under this Section 5.2 and of the contribution obligation of a Selling
Holder under Section 5.4 exceed the net proceeds from the applicable offering
received by such Selling Holder, and (c) the obligation to provide
indemnification hereunder shall be several, and not joint and several, among the
indemnifying parties.
Section 5.3 Notice of Claims, etc. Promptly after receipt by an
indemnified party under this Article V of notice of the commencement of any
action, suit, proceeding, investigation or threat thereof made in writing for
which such indemnified party may make a claim under this Article V, such
indemnified party shall deliver to the indemnifying party a written notice of
the commencement thereof. The failure to deliver written notice to the
indemnifying party shall not relieve such indemnifying party of any liability to
the indemnified party under this Article V.
-15-
<PAGE> 19
Any fees and expenses incurred by the indemnified party (including any fees and
expenses incurred in connection with investigating or preparing to defend such
action or proceeding) shall be paid to the indemnified party, as incurred,
within thirty days of written notice thereof to the indemnifying party
(regardless of whether it is ultimately determined that an indemnified party is
not entitled to indemnification hereunder). Any such indemnified party shall
have the right to employ separate counsel in any such action, claim or
proceeding, and to participate in the defense thereof, but the fees and expenses
of such counsel shall be the expenses of such indemnified party unless (a) the
indemnifying party shall have failed to promptly assume the defense of such
action, claim or proceeding, or (b) the named parties to any such action, claim
or proceeding (including any impleaded parties) include both such indemnified
party and the indemnifying party, and such indemnified party shall have been
advised by its counsel that there may be one or more legal defenses available to
it which are different from or in addition to those available to the
indemnifying party and that the assertion of such defenses would create a
conflict of interest such that counsel employed by the indemnifying party could
not represent the indemnified party (in which case, if such indemnified party
notifies the indemnifying party in writing that it elects to employ separate
counsel at the expense of the indemnifying party, the indemnifying party shall
not have the right to assume the defense of such action, claim or proceeding on
behalf of such indemnified party; it being understood, however, that the
indemnifying party shall not, in connection with any one such action, claim or
proceeding or separate but substantially similar or related actions, claims or
proceedings in the same jurisdiction arising out of the same general allegations
or circumstances, be liable for the reasonable fees and expenses of more than
one separate firm of attorneys (together with appropriate local counsel) at any
time for all such indemnified parties, unless the indemnified party shall have
been advised by its counsel that a conflict of interest may exist between such
indemnified party and any other of such indemnified parties with respect to such
action, claim or proceeding such that the counsel could not represent the
indemnified party and any other of such indemnified parties, in which event the
indemnifying party shall be obligated to pay the fees and expenses of such
additional counsel or counsels). No indemnifying party shall be liable to an
indemnified party for any settlement of any action, proceeding or claim without
the written consent of the indemnifying party, which consent shall not be
unreasonably withheld.
Section 5.4 Contribution. If the indemnification required by this Article
V from the indemnifying party is unavailable to an indemnified party hereunder
in respect of any losses, claims, damages, liabilities or expenses referred to
in this Article V:
(a) The 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 losses, claims, damages, liabilities or expenses in such
proportion as is appropriate to reflect the relative fault of the indemnifying
party and indemnified parties in connection with the actions which resulted in
such losses, claims, damages, liabilities or expenses, as well as any other
relevant equitable considerations. The relative fault of such indemnifying party
and indemnified parties shall be determined by reference to, among other things,
whether any Violation has been committed by, or relates to information supplied
by, such indemnifying party or indemnified parties, and the parties' relative
intent, knowledge, access to information and opportunity to correct or prevent
such Violation. The amount paid or payable by a party as a result of the losses,
-16-
<PAGE> 20
claims, damages, liabilities and expenses referred to above shall be deemed to
include, subject to the limitations set forth in Section 5.1 and Section 5.2,
any legal or other fees or expenses reasonably incurred by such party in
connection with any investigation or proceeding.
(b) The parties hereto agree that it would not be just and equitable if
contribution pursuant to this Section 5.4 were determined by pro rata allocation
or by any other method of allocation, which does not take into account, the
equitable considerations referred to in Section 5.4(a). 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.
Section 5.5 Survival. The obligations of the Company and the Selling
Holders of Registrable Securities under this Article V shall survive the
completion of any offering of Registrable Securities pursuant to a registration
statement under this Agreement.
ARTICLE VI
RULE 144 AND RULE 144A
Section 6.1 Reports, etc. The Company will file the reports required to
be filed by it under the Securities Act and the Exchange Act and the rules and
regulations promulgated by the Commission thereunder and will take such further
action as any Holder may reasonably request, to the extent required from time to
time to enable the Holder to sell Registrable Securities without registration
under the Securities Act within the limitation of the exemptions provided by (a)
Rule 144, (b) Rule 144A, or (c) any similar rule or regulation hereafter adopted
by the Commission. Upon the request of any Holder, the Company will deliver to
that Holder a written statement as to whether it has complied with such
requirements, a copy of the most recent annual or quarterly report of the
Company, and such other reports or documents so filed as a Holder may reasonably
request in availing itself of any rule or regulation of the Commission allowing
a Holder to sell any such securities without registration.
Section 6.2 Rule 144 Information. If at any time the Company is not
required to file reports in compliance with either Section 13 or Section 15(d)
of the Exchange Act, the Company at its expense will, forthwith upon the request
of any Holder, make available adequate current public information with respect
to the Company within the meaning of paragraph (c)(2) of Rule 144.
Section 6.3 Rule 144A Information. If at any time the Company is not
required to file reports in compliance with either Section 13 or Section 15(d)
of the Exchange Act, the Company at its expense will, forthwith upon the request
of any Holder or prospective purchaser, provide to the Holder and any
prospective purchaser reasonably current information with respect to the Company
within the meaning of paragraph (d)(4) of Rule 144A.
-17-
<PAGE> 21
ARTICLE VII
MISCELLANEOUS
Section 7.1 Amendment, Modification and Waivers; Further Assurances.
(a) This Agreement may be amended with the consent of the Company, and the
Company may amend this Agreement or 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 Holders owning all of the Registrable Securities then outstanding.
(b) No waiver of any terms or conditions of this Agreement shall operate
as a waiver of any other breach of such terms and conditions or any other term
or condition, nor shall any failure to enforce any provision hereof operate as a
waiver of such provision or of any other provision hereof. No written waiver
hereunder, unless it by its own terms explicitly provides to the contrary, shall
be construed to effect a continuing waiver of the provisions being waived, and
no such waiver in any instance shall constitute a waiver in any other instance
or for any other purpose or impair the right of the party against whom such
waiver is claimed in all other instances or for all other purposes to require
full compliance with such provision.
(c) Each of the parties hereto shall execute all such further instruments
and documents and take all such further action as any other party hereto may
reasonably require in order to effectuate the terms and purposes of this
Agreement.
Section 7.2 Assignment. This Agreement shall be binding upon and inure
to the benefit of and be enforceable by the parties and their respective
successors and permitted assigns of Registrable Securities. The rights and
obligations of a Holder under this Agreement may collectively be transferred or
assigned (in whole or in part) to one or more Persons who is a transferee of
Registrable Securities; provided, however, that any such transferee of
Registrable Securities agrees in writing, in form and substance satisfactory to
the Company, to be bound by all of the terms and provisions hereof and to join
this Agreement as a party hereto; and provided, further, that no such assignment
of rights and obligations shall be effective with respect to Registrable
Securities that, as a result of such transfer, have ceased to be Registrable
Securities by reason of the second sentence of the definition of Registrable
Securities set forth in Section 1.1 (such transferee, a "Permitted Transferee").
Section 7.3 Invalid Provisions. If any provision of this Agreement is
held to be illegal, invalid or unenforceable under any present or future law,
(a) such provision will be fully severable, (b) this Agreement will be construed
and enforced as if such illegal, invalid or unenforceable provision had never
comprised a part hereof, (c) the remaining provisions of this Agreement will
remain in full force and effect and will not be affected by the illegal, invalid
or unenforceable provision or by its severance herefrom, and (d) in lieu of such
illegal, invalid or unenforceable provision, there will be added automatically
as a part of this Agreement a legal, valid and enforceable provision as similar
in terms to such illegal, invalid or unenforceable provision as may be possible.
-18-
<PAGE> 22
Section 7.4 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 request or other action by any
Holder or Holders pursuant to this Agreement or any determination of any amount
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. For purposes of this Agreement, "beneficial ownership" and
"beneficial owner" refer to beneficial ownership as defined in Rule 13d-3
(without regard to the 60-day provision in paragraph (d)(1)(i) thereof) under
the Exchange Act.
Section 7.5 Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT GIVING
REGARD TO THE CONFLICT OF LAWS PRINCIPLES THEREOF.
Section 7.6 Notices. All notices and requests given pursuant to this
Agreement shall be in writing and shall be made by hand-delivery, first-class
mail (registered or certified, return receipt requested), confirmed facsimile or
overnight air courier guaranteeing next business day:
(a) If to the Company, to:
Financial Performance Corporation
335 Madison Avenue
New York, New York 10017
Facsimile Number: (212) 557-0490
Attention: President and Chief Executive Officer
With a copy to:
Jonathan J. Russo, Esq.
Baer Marks & Upham LLP
805 Third Avenue
New York, New York 10022
Facsimile Number: (212) 702-5941
If to Finley, to:
William Finley
c/o Financial Performance Corporation
335 Madison Avenue
New York, New York 10017
Facsimile Number: (212) 557-0490
-19-
<PAGE> 23
With a copy to:
David Mollon, Esq.
Winston & Strawn
200 Park Avenue
New York, New York 10166-4193
Facsimile Number: 212-294-4700
If to Trump, to:
Robert S. Trump
C/o Trump Management, Inc.
2611 W. 2nd Street
Brooklyn, New York 11223
Facsimile Number: (718) 891-3609
With a copy to:
Gary S. Friedman, Esq.
Kaufman Friedman Plotnicki & Grun, LLP
300 East 42nd Street,
New York, New York 10017
Facsimile Number: (212) 687-3179
If to Silverman, to:
Jeffrey Silverman
LTS Capital Partners
777 Third Avenue
New York, New York 10017
Facsimile Number: (212) 446-0229
With a copy to:
Kramer Levin Naftalis & Frankel LLP
919 Third Avenue
New York, New York 10022
Attention: Howard Sobel, Esq.
Facsimile Number: 212 715-8000
-20-
<PAGE> 24
If to Nash, to:
Ronald Nash
650 Fifth Avenue
New York, New York 10019
Facsimile Number: ______________
With a copy to:
Kramer Levin Naftalis & Frankel LLP
919 Third Avenue
New York, New York 10022
Attention: Howard Sobel, Esq.
Facsimile Number: 212 715-8000
(b) If to a Permitted Transferee, to the address for such Permitted
Transferee set forth on Schedule 7.6, as may be amended from time to time.
Except as otherwise provided in this Agreement, the date of each such notice and
request shall be deemed to be, and the date on which each such notice and
request shall be deemed given shall be: (i) at the time delivered, if personally
delivered or mailed; (ii) when receipt is acknowledged, if sent by facsimile;
and (iii) the next business day after timely delivery to the courier, if sent by
overnight air courier guaranteeing next business day delivery.
Section 7.7 Entire Agreement; Integration. This Agreement supersedes
all prior agreements between or among any of the parties hereto with respect to
the registration of any securities of the Company, and any and all such
agreements are hereby deemed canceled and of no further force and effect and
this Agreement embodies the entire understanding among the parties relating to
such subject matter.
Section 7.8 Injunctive Relief. Each of the parties hereto acknowledges
that in the event of a breach by any of them of any material provision of this
Agreement, the aggrieved party may be without an adequate remedy at law. Each of
the parties therefore agrees that in the event of such a breach hereof the
aggrieved party may elect to institute and prosecute proceedings in any court of
competent jurisdiction to enforce specific performance or to enjoin the
continuing breach hereof. By seeking or obtaining any such relief, the aggrieved
party shall not be precluded from seeking or obtaining any other relief to which
it may be entitled.
Section 7.9 Section Headings. Section headings are for convenience of
reference only and shall not affect the meaning of any provision of this
Agreement,
Section 7.10 Counterparts. This Agreement maybe executed in any number
of counterparts, each of which shall be an original, and all of which shall
together constitute one and the same instrument. All signatures need not be on
the same counterpart.
-21-
<PAGE> 25
Section 7.11 Filing. A copy of this Agreement and of all amendments
thereto shall be filed at the principal executive office of the Company with the
Secretary of the Company.
Section 7.12 Termination. This Agreement may be terminated at any time
by a written instrument signed by the Company and all of the Holders of
Registrable Securities. Unless sooner terminated in accordance with the
immediately preceding sentence, the parties' obligations under this Agreement
(other than Articles V and VI hereof) shall terminate in their entirety on the
tenth anniversary of the date hereof.
Section 7.13 Attorneys' Fees. In any action or proceeding brought to
enforce any provision of this Agreement, the successful party shall be entitled
to recover reasonable attorneys' fees (including any fees incurred in any
appeal) in addition to its costs and expenses and any other available remedy.
Section 7.14 No Third Party Beneficiaries. Nothing herein expressed or
implied is intended to confer upon any Person, other than the parties hereto or
their respective permitted assigns, successors, heirs and legal representatives,
or any indemnified party hereunder, any rights, remedies, obligations or
liabilities under or by reason of this Agreement.
Section 7.15 Requisite Holders. Each of the parties hereto agrees that
the Company may, in connection with the taking of any action permitted to be
taken hereunder with the consent or approval of the Requisite Holders of the
Registrable Securities, rely in good faith on a certificate from any such holder
or holders stating that it holds or is acting on behalf of a majority in
interest of the Registrable Securities.
-22-
<PAGE> 26
IN WITNESS WHEREOF, this Registration Rights Agreement has been duly
executed by the parties hereto as of the date first written above.
Finance Performance Corporation
By:
----------------------------------------
Name:
Title:
-------------------------------------------
William F. Finley
-------------------------------------------
Robert S. Trump
-------------------------------------------
Jeffery Silverman
-------------------------------------------
Ronald Nash
-23-
<PAGE> 1
EXHIBIT 10.13
EXECUTIVE EMPLOYMENT AGREEMENT
AGREEMENT made as of November 17, 1999, by and between Financial
Performance Corporation, a New York corporation with offices at 335 Madison
Avenue, 8th Floor, New York, New York ("FPC"), FPC Information Corp., a New
York corporation with offices at 335 Madison Avenue, 8th Floor, New York, New
York ("FPC Information Corp.") and William F. Finley, an individual residing
at 684 Hill Farm Road, Fairfield, Connecticut 06430 ("Finley"). FPC and FPC
Information Corp. are hereinafter jointly and severally referred to as the
"Corporation".
W I T N E S S E T H:
WHEREAS, Finley is employed by the Corporation pursuant to the
Restated and Amended Executive Employment Agreement dated April 21, 1999,
between Finley and the Corporation (the "Old Agreement");
WHEREAS, the Corporation desires to continue to engage the
services of Finley as President, Chief Executive Officer and Principal
Financial Officer of the Corporation;
WHEREAS, Finley is willing to continue such employment by the
Corporation; and
WHEREAS, the Corporation and Finley desire to amend and restate
the Old Agreement on the terms and conditions set forth herein;
NOW, THEREFORE, in consideration of the premises, the mutual
covenants hereinafter set forth, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
the parties agree as follows:
1. Employment. The Corporation hereby employs Finley and Finley
hereby accepts such employment upon the terms and conditions hereinafter set
forth.
2. Term. The term of this agreement shall commence on the date
hereof and end on September 30, 2000 (the "Term"), unless earlier terminated by
the Corporation or by Finley in accordance with the provisions hereof.
3. Duties. Subject to Section 7, Finley is engaged for the Term
hereof as President, Chief Executive Officer and Principal Financial Officer of
the Corporation and shall perform and discharge well and faithfully the duties
which may be undertaken by Finley in such capacity from time to time, such
duties to be substantially similar to the duties heretofore undertaken by Finley
as President, Chief Executive Officer and Principal Financial Officer of the
Corporation. The duties of Finley shall include managing the Corporation's
day-to-day operations, including, without limitation, hiring, training,
supervising and terminating employees, determining employee compensation
(including incentives) and employment policy, including assignment of employees'
duties and how same are to be performed, all aspects of client relationships,
maintaining the Corporation's books and records, serving as a member of the
<PAGE> 2
Board of Directors and any other duties consistent with his position as
President, Chief Executive Officer and Principal Financial Officer, as may be
determined by the Board of Directors; it being the intent of the parties that
Finley shall exercise full management control of the day-to-day operations of
the Corporation for so long as Finley is employed by the Corporation.
4. Extent of Services. During the period in which Finley is employed
by the Corporation, Finley shall devote Finley's full business time, best
efforts, attention, skill and energies to the business of the Corporation and
shall not during such period be engaged in any other business activity pursued
for gain, profit or other pecuniary advantage; but this shall not be construed
as preventing Finley from investing Finley's personal assets in businesses which
do not compete with the Corporation in such form or manner as will not require
any active business services on the part of Finley in the operation of the
affairs of the companies in which such investments are made and in which
Finley's participation is solely that of a passive investor.
5. Compensation. (a) For all services rendered by Finley pursuant to
this agreement, the Corporation shall pay Finley an annual salary during the
Term of $250,000, payable twice monthly on the 15th and 30th of each month, in
arrears. Such salary shall be subject to periodic increases as shall be
determined by the Board of Directors of the Corporation.
(b) In consideration for agreeing to amend and restate the Old
Agreement, upon the execution of this Agreement, the Corporation shall (i) pay
to Finley $250,000, via bank certified or cashier's check; and (ii) issue to
Finley 100,000 shares of validly issued, fully paid and non-assessable shares of
the Corporation's Common Stock (collectively, the "Shares").
6. Employment Benefits.
(a) Finley shall be entitled to four (4) weeks vacation during each
one (1) year of Finley's employment pursuant to this agreement, during which
Finley's salary shall be paid in full. Finley shall be entitled to reimbursement
of all reasonable out-of-pocket business expenses incurred on behalf of the
Corporation, provided that such expenses are reasonably necessary and are
properly documented. Finley shall be entitled to all privileges under any
retirement, pension, long-term or short-term disability insurance plan which may
hereafter be adopted by the Corporation for the benefit of its employees. The
Corporation shall provide Finley with and shall pay all premiums for family
coverage under a group health insurance plan. The Corporation shall also provide
Finley with a leased automobile of Finley's choice throughout the term of this
agreement, including payment or reimbursement for all insurance, maintenance and
repair costs.
(b) The Corporation shall register, at the Corporation's sole cost
and expense, all of the shares of stock of the Corporation (including shares
issuable upon the exercise of any warrants, options or other convertible
securities of the Corporation) now or hereafter owned by Finley as set forth in
that certain Registration Rights Agreement dated the date hereof among the
Corporation, Finley and Robert S. Trump.
2
<PAGE> 3
(c) The Corporation shall obtain and pay all premiums for a term
life insurance policy covering Finley's life. Such policy shall be in an amount
not less than $500,000.00, provided that the premium for such policy does not
exceed customary, reasonable rates for an executive in good health. The
Corporation shall be the owner of the policy and Finley (or Finley's
designee(s)) shall be the beneficiary of such policy.
7. Termination.
(a) The Corporation may, at its election in accordance with the
procedures more particularly set forth below, terminate this agreement for
cause. For purposes of this agreement, "cause" shall be defined as and limited
to the following: (i) a material breach by Finley of any material term of this
agreement that has not been cured within thirty (30) days of receipt by Finley
of written notice of such breach and which causes substantial damage to the
reputation, business or property of the Corporation or any of the Corporation's
subsidiaries, any of the Corporation's affiliates or any of the Corporation's
(or any affiliates') customers; (ii) a continued failure of Finley after thirty
(30) days written notice of a prior failure to devote Finley's full business
time (as more particularly described in Section 4 above) to the performance of
Finley's duties hereunder; (iii) an act of willful misconduct in the performance
of Finley's duties hereunder which causes substantial damage to the reputation,
business or property of the Corporation, any of the Corporation's affiliates or
any of the Corporation's customers including, without limitation, any oral or
written material misrepresentation relating to the Corporation or any of the
Corporation's subsidiaries (or any affiliate) or any of its (or any affiliate's)
customers which causes substantial damage to the reputation of the Corporation
(or any affiliate); (iv) conviction of a felony; and (v) substantial, continuing
and willful improper performance or non-performance of any of Finley's material
duties hereunder after thirty (30) days written notice to cure as aforesaid. For
purposes of this subsection (a), no act, or failure to act, on Finley's part
shall be considered "willful" unless done, or omitted to be done, by him not in
good faith or without reasonable belief that his action or omission was in the
best interests of the Corporation. Notwithstanding the foregoing, Finley shall
not be deemed to have been terminated for cause without (i) thirty (30) days'
notice to Finley setting forth the reasons for the Corporation's intention to
terminate for cause as set forth above in this subsection (a); (ii) an
opportunity for Finley, together with his counsel, to be heard before the
Corporation's board of directors; and (iii) delivery to Finley of a Notice of
Termination as defined in subsection (d) below from an executive officer of the
Corporation finding that, in the good faith opinion of the Board of Directors of
FPC, Finley was guilty of conduct set forth or described above in justifying the
Corporation's termination of Finley's employment for cause and specifying the
particulars thereof in detail.
(b) Finley may terminate his employment under this agreement for
Good Reason (as hereinafter defined). For purposes of this agreement, "Good
Reason" shall mean (i) a failure by the Corporation to comply with, or the
breach by the Corporation of, any material provision of this agreement, which
noncompliance shall have a material adverse effect upon Finley and which shall
not have been cured within thirty (30) days after notice of such noncompliance
has been given by Finley to the Corporation pursuant to this agreement, (ii) if
Finley's management functions, duties, or responsibilities or any other material
aspect of Finley's employment shall have been materially and adversely changed
or diminished by the Corporation, (iii) if Finley shall cease to be President,
Chief Executive Officer and Principal Financial Officer
3
<PAGE> 4
of FPC (other than by reason of death, disability or resignation), (iv) any
purported termination of Finley's employment which is not properly effected
pursuant to a Notice of Termination satisfying the requirements of subsection
(d) below (and for purposes of this agreement no such purported termination
shall be effective), or (v) the failure of FPC, on or prior to the date of any
merger, consolidation or any similar transaction, to obtain the written
assumption by any successor to the business of FPC of FPC's obligations
hereunder.
(c) Any termination of Finley's employment by the Corporation or by
Finley (other than termination by reason of Finley's death or disability as set
forth in Section 15 below) shall be communicated by written Notice of
Termination to the other party hereto. For purposes of this agreement, a "Notice
of Termination" shall mean a notice which shall indicate the specific
termination provision in this agreement relied upon and shall set forth in
reasonable detail the facts and circumstances claimed to provide a basis for
termination of Finley's employment under the provision so indicated.
(d) "Date of Termination" shall mean (i) if Finley's employment is
terminated by his death, the date of his death, (ii) if Finley's employment is
terminated pursuant to subsection (c) above, the date specified in the Notice of
Termination, and (iii) if Finley's employment is terminated for any other
reason, the date on which a Notice of Termination is given; provided that if
within thirty (30) days after any Notice of Termination is given the party
receiving such Notice of Termination notifies the other party that a dispute
exists concerning the termination, the Date of Termination shall be the date on
which the dispute is finally determined, either by mutual written agreement of
the parties, by a binding and final arbitration award or by a final judgment,
order or decree of a court of competent jurisdiction (the time for appeal
therefrom having expired and no appeal having been perfected).
8. Compensation Upon Termination or During Disability.
(a) During any period that Finley fails to perform his duties
hereunder as a result of incapacity due to physical or mental illness
("disability period"), Finley shall continue to receive his full salary at the
rate then in effect for such period and all employment benefits due to Finley
until his employment is terminated pursuant to Section 7 above and Section 15
below, provided that payments so made to Finley during the disability period
shall be reduced by the sum of the amounts, if any, payable to Finley at or
prior to the time of any such payment under disability benefit plans of the
Corporation and which were not previously applied to reduce any such payment.
Within thirty (30) days of the termination of Finley's employment due to
disability, the Corporation shall pay to Finley all salary and employment
benefits due to him accrued through the date of such termination.
(b) If Finley's employment shall be properly terminated for cause
pursuant to all of the applicable provisions of this agreement, the Corporation
shall pay Finley his full salary only through the Date of Termination at the
rate in effect at the time Notice of Termination is given and the Corporation
shall have no further obligations to Finley under or pursuant to this Agreement.
(c) If (i) in breach of this agreement, the Corporation shall
terminate Finley's employment other than pursuant to subsection 7 (a) above
(termination for cause) or
4
<PAGE> 5
Section 15 below (termination by reason of death or disability)(it being
understood that a purported termination by the Corporation pursuant to
subsection 7 (a) above or Section 15 below which is disputed and finally
determined not to have been proper shall be deemed a termination by the
Corporation in breach of this agreement) or (ii) Finley shall terminate his
employment for Good Reason, then
(I) the Corporation shall pay Finley his full salary and all
employment benefits due to Finley through the Date of Termination at the rate in
effect at the time the Notice of Termination is given; and
(II) the Corporation shall pay to Finley, as severance pay (and not
as a penalty to the Corporation), an amount equal to Finley's annual base salary
for the period from the Date of Termination through the expiration of the Term,
such payment to be made in a lump sum on the Date of Termination in the event of
termination by the Corporation under 8(c)(i) above, and on or before the third
business day following the Date of Termination in the event of Finley's
termination under 8(c)(ii) above;
(d) The Corporation may withhold from any payments or other benefits
payable to Finley pursuant to this Section 8 or any other provision of this
agreement all federal, state, city or other taxes as shall be required pursuant
to any law, government regulation or ruling.
(e) In addition to any compensation otherwise required hereunder
upon termination, if (i) in breach of this agreement, the Corporation shall
terminate Finley's employment other than pursuant to subsection 7 (a) above
(termination for cause) or Section 15 below (termination by reason of death or
disability)(it being understood that a purported termination by the Corporation
pursuant to subsection 7 (a) above or Section 15 below which is disputed and
finally determined not to have been proper shall be deemed a termination by the
Corporation in breach of this agreement) or (ii) Finley shall terminate his
employment for Good Reason, then Finley shall have the right (the "Put") to
require the Corporation to purchase from Finley all or any portion of the shares
of capital stock and warrants, options or other securities exercisable for or
convertible into capital stock of the Corporation (collectively, "Convertible
Securities") then owned by Finley. Upon exercise of the Put by Finley, the
Corporation shall pay Finley an amount equal to the Purchase Price multiplied by
the number of shares of capital stock and Convertible Securities subject to the
Put (the "Put Purchase Price"), minus the exercise price or conversion price of
the Convertible Securities, if any, subject to the Put. Finley shall exercise
this Put right by giving the Corporation written notice of exercise (the "Put
Notice") at any time during the ten (10) day period commencing on the Date of
Termination. The Purchase Price shall mean the fair market value of the shares
of capital stock of the Corporation determined by the average of the closing
sale prices of such shares on the stock exchange, securities association or
automated quotation system on which such shares are then traded or quoted for
the five (5) consecutive trading days immediately preceding the Date of
Termination or, if such shares are not then traded or quoted on any such
exchange, association or system, the fair market value of the shares as mutually
determined by the Corporation and Finley. The Put Purchase Price shall be
payable in one lump sum payment, in immediately available funds, on a date
within five (5) business days of the date on which the Put Notice is given.
Against receipt of payment in full of the Put Purchase Price on such date,
Finley shall deliver to the Corporation all certificates
5
<PAGE> 6
representing the securities subject to the Put. Such certificates shall be
accompanied by executed stock powers or similar transfer documents relating to
the Convertible Securities.
9. Intentionally omitted.
10. Disclosure of Information. Finley recognizes and acknowledges
that the trade secrets and know how of FPC and its subsidiaries as they may
exist from time to time are a valuable, special and unique asset of the
businesses of such companies, access to and knowledge of which are essential to
the performance of Finley's duties hereunder. For the purposes of this
agreement, Confidential Information includes any and all information disclosed
or made available to Finley in consequence of or through his employment by the
Corporation and not generally known in the industries in which FPC and its
subsidiaries or any of the customers of FPC and its subsidiaries is or may be
engaged, or which is beneficial to FPC or its subsidiaries, or any of the
customers of FPC or its subsidiaries, in the promotion or operation of their
respective businesses, (ii) relating to the business, business practices,
operation, affairs, practices, procedures, policies or methods of FPC or its
subsidiaries, (iii) customer lists, (iv) marketing information and (v) training
materials. Since the services of Finley are unique, extraordinary and of a
specialized character which will require Finley to handle Confidential
Information of FPC and FPC's subsidiaries and such companies' suppliers and
customers, Finley shall not, at any time during the term of this agreement or
thereafter, make use of any Confidential Information for the benefit of any
person or entity (other than FPC or its subsidiaries) nor shall Finley disclose
any Confidential Information to any person or entity for any reason or purpose
whatsoever.
11. Covenants Not to Solicit. For the six (6) month-period
immediately following the earlier of the termination of Finley's employment
hereunder or the date of expiration of this agreement, Finley, whether as a
proprietor, partner, employee, agent, consultant, director, officer, controlling
stockholder or in any other capacity whatsoever, shall not, without the consent
of FPC or of any of its subsidiaries, (a) solicit any Business Associate (as
hereinafter defined) for the purpose of interfering with, disrupting or
attempting to disrupt the relationship, contractual or otherwise between FPC
and/or any of its subsidiaries and such Business Associate, or (b) request any
Business Associate to cancel, curtail or divert his, her or its business with
FPC and/or any of its subsidiaries. For purposes hereof, the term "Business
Associate" means any person or entity that, to Finley's knowledge, is, at the
time of any such solicitation or request, a customer, client, or employee of FPC
and/or any of its subsidiaries with whom Finley had any direct or indirect
contact during his employment hereunder. However, notwithstanding the foregoing
provisions of this Section 11, it is understood that Finley may, in good faith,
contact all customers and clients of FPC and/or any of its subsidiaries
originated by or otherwise brought to FPC and/or any of its subsidiaries by
Finley during the term of Finley's employment by the Corporation in connection
with establishing any other business enterprises subsequent to the expiration or
termination of this agreement.
12. Return of Documents. Upon termination of employment with the
Corporation, Finley shall promptly return to the Corporation all documents,
notes, records and other materials of FPC and/or any of its subsidiaries in
Finley's possession, whether prepared by Finley or others. However, Finley
shall be entitled to retain copies of all such documents,
6
<PAGE> 7
notes, records and other materials and may use same subject only to Finley's
covenants set forth in Section 10 ("Disclosure of Information") and Section 11
("Covenants Not to Solicit").
13. Enforcement of Non-Disclosure and Non-Solicitation Provisions.
It is the desire and intent of the parties that the provisions of Sections 10,
11 and 12 shall be enforced to the fullest extent permissible under the laws and
public policies applied in each jurisdiction in which enforcement is sought.
Accordingly, if any portion or portions of such Sections 10, 11 or 12 shall be
adjudicated to be invalid or unenforceable, such Sections shall be deemed
amended to delete therefrom the portion or portions thus adjudicated to be
invalid or unenforceable, such deletion to apply only with respect to the
operation of such Sections in the particular jurisdiction in which such
adjudication is made. The provisions of Sections 10, 11, 12 and 14 shall survive
the expiration or earlier termination of this agreement.
14. Injunctive Relief. If there is a breach or threatened breach of
any of the provisions of Sections 10, 11 or 12 of this agreement, the
Corporation shall be entitled to an injunction restraining Finley from such
breach. Nothing herein shall be construed as prohibiting the Corporation from
pursuing any other remedies for such breach or threatened breach.
15. Disability/Death. Finley's employment under this agreement shall
terminate upon the death or, at the election of the Corporation, the physical or
mental disability of Finley. For purposes of this Agreement, Finley shall be
deemed to be disabled if he is unable to perform his services for twelve (12)
consecutive months. If the Corporation elects to terminate this agreement
pursuant to this Section 15, the Corporation shall notify Finley of the
Corporation's decision to terminate Finley's employment hereunder by means of a
Notice of Termination pursuant to the provisions of subsection (d) of Section 7
above. From and after such termination of employment of Finley pursuant to this
Section 15, Finley's compensation and rights thereto and all of Finley's other
rights under this agreement shall terminate except as otherwise specifically set
forth in Sections 8 and 9 above.
16. Notices. Any notice required or permitted to be given under this
agreement shall be sufficient if in writing and if sent by certified mail,
return receipt requested, or by personal delivery, to Finley's mailing address
set forth above in the case of Finley, and to its office address set forth
above, in the case of the Corporation, with a copy sent in like manner to Baer
Marks & Upham LLP, 805 Third Avenue, New York, New York 10022, Attention:
Jonathan J. Russo, Esq. Notices shall be deemed given two (2) business days
after mailing, or on the date personal delivery is effected, as the case may be.
17. Waiver of Breach. The waiver by a party of a breach of any
provision of this agreement by another party shall not operate or be construed
as a waiver of any subsequent or other breach by such other party. Any waiver
must be in writing.
18. Entire Agreement. This Agreement contains the entire agreement
of the parties hereto with respect to Executive's employment by the Corporation,
and all prior agreements and arrangements are hereby superceded in all respects
from and after the date hereof. This Agreement may not be waived, changed,
modified or extended orally but only by an agreement in writing signed by the
party against whom enforcement of any waiver, change, modification or extension
is sought.
7
<PAGE> 8
19. Applicable Law. This agreement shall be governed by and
construed and enforced in accordance with the internal laws of the State of New
York without regard to the application of conflict of laws.
20. Severability. If any provision of this agreement is found to be
void or unenforceable by a court of competent jurisdiction, the remaining
provisions of this agreement shall nevertheless be binding upon the Corporation
and Finley with the same effect as though the void or unenforceable provision
had been severed and deleted.
21. Conflict. If any provision of this agreement is found to be in
conflict with any provision of any other agreement to which the Corporation and
Finley are parties, the provision of such other agreement shall control.
22. Arbitration. If any dispute shall arise between the Corporation
and Finley with regard to this agreement, such dispute shall be promptly
submitted to and decided by arbitration by the American Arbitration Association
in the City and County of New York in accordance with the Expedited Procedures
of the Commercial Arbitration Rules of the American Arbitration Association. The
award rendered by the arbitrators shall be final, shall include an award of
reasonable legal fees and costs to the prevailing party as determined by the
arbitrator(s) and judgment may be entered upon the award in accordance with
applicable law in any court having jurisdiction.
23. Non-Assignment. This Agreement and all rights hereunder are
personal to Finley and shall not be assignable; provided, however, all of
Finley's rights to compensation following his death shall inure to the benefit
of his surviving spouse, his estate or other legal representatives as the case
may be. Any person, firm, corporation or entity succeeding to the business of
FPC and/or FPC Information Corp. by merger, purchase, consolidation or otherwise
shall assume by contract or operation of law all obligations of the Corporation
hereunder; provided, however, the Corporation shall, notwithstanding such
assumption or assignment, remain liable and responsible for the fulfillment of
its obligations under this Agreement.
8
<PAGE> 9
IN WITNESS WHEREOF, the parties hereto have caused this
Employment Agreement to be duly executed as of the day and year first above
written.
FINANCIAL PERFORMANCE CORPORATION
By:
----------------------------
Dunan Burke, Vice President
FPC INFORMATION CORP.
By:
----------------------------
Dunan Burke, Vice President
-------------------------------
William F. Finley, individually
9
<PAGE> 1
EXHIBIT 10.14
FIRST AMENDMENT TO RESTATED AND AMENDED
SHAREHOLDERS AGREEMENT
First Amendment made as of November 16, 1999, by and among Michaelson Kelbick
Partners, Inc., (originally known as FPC Consulting Corp.), with offices at
335 Madison Avenue, 8th Floor, New York, New York 10017 (the "Corporation"),
Financial Performance Corporation, with offices at 335 Madison Avenue, 8th
Floor, New York, New York 10017 ("FPC"), Susan Michaelson, residing at
____________________________ ("Susan"), and Hillary Kelbick, residing at
_______________________________ ("Hillary").
W I T N E S S E T H:
Whereas, the parties hereto entered into Restated and Amended Shareholders
Agreement dated as of October 1, 1998 (the "Shareholders Agreement"), a copy
of which is annexed hereto, and
Whereas, the parties hereto desire to amend the Shareholders Agreement, as
herein set forth.
Now, therefore, in consideration of the premises, the mutual covenants
hereinafter set forth, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
hereby agree as follows:
Effective as of the date hereof, Section 7 of the Shareholders Agreement is
hereby amended and restated in its entirety to read as follows:
"7. Purchase of Stock by MKP in Event of Termination
of Employment of Individual Shareholder.
If either of the Individual Shareholders terminates her employment with MKP
or if MKP terminates the employment of either of the Individual Shareholders
for any reason pursuant to the terms of the Restated and Amended Managing
Director's Agreement with such Individual Shareholder dated as of November
15, 1999, as amended, or any successor or substitute agreement (hereinafter,
the "Employment Agreement"), or upon the expiration of the Employment
Agreement without extension or renewal thereof, then the following provisions
shall apply:
7.1 Each of the Individual Shareholders shall have the right to
require MKP to purchase from such Individual Shareholder all (but not less
than all) of the Stock then owned by such Individual Shareholder. Each
Individual Shareholder shall exercise her right hereunder by giving MKP
written notice of exercise at any time during the sixty (60) day period
commencing on the date of termination of employment of such Individual
Shareholder. The aggregate purchase price to be paid by MKP shall be the
Cash Value (hereinafter defined) of the Stock then owned by the Individual
Shareholder; provided however, that if MKP terminates the Employment
Agreement of such Individual Shareholder for "cause", as such term is defined
in the Employment Agreement, then the aggregate purchase price to be paid by
MKP shall be an amount equal to fifty (50%) percent of the Cash Value of such
Stock. The purchase price for the Stock of each Individual Shareholder shall
be payable in full and in cash (in U.S. dollars) at the offices of MKP (or
such other office as the Individual Shareholders may designate) at a date and
<PAGE> 2
time (during ordinary business hours) fixed by the Individual Shareholders
not later than ten (10) calendar days after the date on which the Individual
Shareholders shall have given their notice of exercise to MKP.
7.2. If either of the Individual Shareholders does not exercise her
right to require MKP to purchase such Individual Shareholder's Stock pursuant
to the provisions of Section 7.1 above, then in such event MKP shall have the
right, but not the obligation, to purchase from such Individual Shareholder
all (but not less than all) of the Stock then owned by such Individual
Shareholder. MKP shall exercise its right hereunder by giving such
Individual Shareholder written notice of exercise at any time after the
60-Day Period (as hereinafter defined) commencing on the expiration of the
sixty (60) day period such Individual Shareholder shall have to notify MKP to
purchase such Individual Shareholder's Stock (the "60-Day Period") pursuant
to the provisions of Section 7.1 above. The aggregate purchase price to be
paid by MKP for such Individual Shareholder's Stock shall be the Agreed Value
(hereinafter defined) of such Stock; provided, however, that if MKP
terminates the Employment Agreement of such Individual Shareholder for
"cause", as such term is defined in the Employment Agreement, then the
aggregate purchase price to be paid by MKP for such Individual Shareholder's
Stock shall be an amount equal to fifty (50%) percent of the Agreed Value of
such Stock. The purchase price shall be payable in full and in cash (in U.S.
dollars) at the offices of MKP (or such other office as the Individual
Shareholders shall designate) at a date and time (during ordinary business
hours) fixed by the Individual Shareholder not later than ten (10) calendar
days after the date on which MKP shall have given its notice of exercise to
an Individual Shareholder."
2. Any capitalized term not specifically defined herein shall have
the meaning ascribed to such term in the Shareholders Agreement.
3. Except as amended in this agreement, all of the terms and
provisions of the Shareholders Agreement shall remain unmodified and in full
force and effect.
4. The covenants, agreements, terms, provisions and conditions
contained in this agreement shall bind and inure to the benefit of the
parties hereto and their respective heirs, successor, legal representatives
and permitted assigns, if any.
5. This agreement may not be modified orally, but only by an
agreement in writing signed by the party against whom enforcement or any
waiver, change, modification or discharge is sought.
6. This agreement may be executed in two or more counterparts, each
of which shall be deemed an original and all of which together shall
constitute one and the same agreement.
7. In the event of any inconsistency between the terms and
provisions of this agreement and the terms and provisions of the Shareholders
Agreement, the terms and provisions of this agreement shall govern and be
binding.
2
<PAGE> 3
In Witness whereof, the parties hereto have executed this agreement as of the
day and year first above written.
Michaelson Kelbick Partners Inc.
By:
------------------------------------
Hillary Kelbick, Managing Director
By:
------------------------------------
Susan Michaelson, Managing Director
Financial Performance Corporation
By:
-----------------------------------
William F. Finley, President
--------------------------------------
Hillary Kelbick, Individually
--------------------------------------
Susan Michaelson, Individually
3
<PAGE> 1
EXHIBIT 10.15
RESTATED AND AMENDED MANAGING DIRECTOR'S AGREEMENT
Agreement made as of November 16, 1999, by and between Michaelson Kelbick
Partners Inc., a New York corporation with offices at 335 Madison Avenue, 8th
Floor, New York, New York 10017(the "Corporation") and Susan Michaelson,
residing at _____________________________ ("Susan").
W I T N E S S E T H:
Whereas, Susan and the Corporation are parties to a Restated and Amended
Managing Director's Agreement dated as of June 18, 1999 (the "Old Agreement").
Whereas, the Corporation and Susan desire to amend and restate the Old
Agreement in the manner and on the terms and conditions set forth below.
Now, therefore, in consideration of the premises, the mutual covenants
hereinafter set forth, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereby
amend and restate the Old Agreement as follows:
1. Employment. The Corporation hereby continues its employment of Susan for
the Term (as hereinafter defined) and Susan hereby accepts such employment upon
the terms and conditions hereinafter set forth.
2. Term.
(a) The Term of this agreement is three (3) years, commencing on September
11, 1997 and ending on September 10, 2000 (the "Term"), unless earlier
terminated by the Corporation or by Susan in accordance with the provisions
hereof. This agreement shall be automatically renewed for periods of one (1)
year each (the "Renewal Term") unless either party shall give the other notice
of her or its desire to terminate this agreement no later than on the June 1st
immediately preceding the expiration of the then current term, in which event
Susan's employment shall terminate at the end of the Term or the applicable
Renewal Term, as the case may be. The Term and the Renewal Term are hereinafter
collectively referred to as the Term.
(b) If Susan has not given notice to the Corporation on or before June 1,
2000 that she elects not to renew this agreement at the expiration of the Term
and the Corporation gives notice to Susan that it elects not to renew this
agreement at the expiration of the Term, then and only in such event, provided
that Susan's employment is not properly terminated by the Corporation for cause
pursuant to and in accordance with the provisions of Section 7 below, in
addition to and without limitation of any other compensation, severance payments
or employment benefits which may be or become due from the Corporation to Susan
pursuant to this agreement (but not in addition to any severance payment which
may be due pursuant to the provisions of subparagraph (c) of this Section 2, it
being understood that such severance payment and the severance payment payable
pursuant to this subparagraph (b) are mutually exclusive), the Corporation shall
pay to Susan, within ten (10) days following the expiration of the Term, a
severance payment in the amount of Three Hundred Fifty Thousand ($350,000.00)
Dollars.
<PAGE> 2
(c) If Susan elects not to renew this Agreement at the expiration of the
Term and Susan's employment is not properly terminated by the Corporation for
cause pursuant to and in accordance with the provisions of Section 7 below, then
and only in such event, in addition to and without limitation of any other
compensation, severance payments or employment benefits which may be or become
due from the Corporation to Susan pursuant to this agreement (but not in
addition to any severance payment which may be due pursuant to the provisions of
subparagraph (b) of this Section 2, it being understood that such severance
payment and the severance payment payable pursuant to this subparagraph (c) are
mutually exclusive), the Corporation shall pay to Susan, within ten (10) days
following the expiration of the Term, a severance payment in the amount of Two
Hundred Fifty Thousand ($250,000.00) Dollars.
(d) For purposes of this agreement, the term "employment benefits" shall
be deemed to include Susan's Annual Bonus (as such term is hereinafter defined).
3. Duties. Susan is engaged for the term hereof as a Managing Director of the
Corporation and shall perform and discharge well and faithfully the duties
which may be undertaken by Susan in such capacity from time to time, such
duties to be substantially similar to the duties heretofore undertaken by
Susan as a Managing Director of the Corporation. The duties of Susan shall
include jointly managing with Hillary Kelbick or her successor ("Hillary"),
the Corporation's day-to-day operations, including, with-out limitation,
hiring, training, supervising and terminating employees, determining employee
compensation (including incentives) and employment policy, including
assignment of employees' duties and how same are to be performed, all aspects
of client relationships, and maintaining the Corporation's books and records,
serving as a member of the Board of Directors and any other duties as may be
determined by the Board of Directors; it being the intent of the parties that
Susan and Hillary shall together exercise full management control of the
day-to-day operations of the Corporation for so long as both Susan and
Hillary are employed by the Corporation.
4. Extent of Services. During the period in which Susan is employed by the
Corporation, Susan shall devote Susan's entire active business time, best
efforts, attention, skill and energies to the business of the Corporation and
shall not during such period be engaged in any other business activity
pursued for gain, profit or other pecuniary advantage; but this shall not be
construed as preventing Susan from investing Susan's personal assets in
businesses which do not compete with the Corporation in such form or manner
as will not require any active business services on the part of Susan in the
operation of the affairs of the companies in which such investments are made
and in which Susan's participation is solely that of a passive investor.
5. Compensation.
(a) For all services rendered by Susan pursuant to this agreement, the
Corporation shall pay Susan an annual salary payable biweekly, in arrears, as
follows: (i) One Hundred Fifty Thousand ($150,000.00) Dollars per annum
during the period commencing on September 11, 1997 through September 30,
1998; and (ii) Two Hundred Fifty Thousand ($250,000.00) Dollars per annum
during the period commencing on October 1, 1998 through the balance of the
Term. Such salary shall be subject to periodic increases as shall be
determined by the Board of Directors of the Corporation.
2
<PAGE> 3
(b) Susan shall be eligible to participate in the Corporation's annual
incentive compensation pool (the "Bonus Pool") in an amount to be determined
annually by the Corporation's Board of Directors based upon the joint
recommendation of Susan and Hillary. The portion of the Bonus Pool to which
Susan shall become entitled for any fiscal year of the Corporation is
hereinafter referred to as "Susan's Annual Bonus". For any fiscal year of the
Corporation, the Bonus Pool shall not exceed in the aggregate an amount equal to
thirty (30%) percent of the Corporation's annual net profits before taxes
determined by the Corporation's outside accounting firm, subject to review and
approval by the accounting firm which prepares the consolidated financial
statements for all of the companies affiliated with FPC, in accordance with
generally accepted accounting principles, consistently applied, as if the
Corporation were not a member of an affiliated group of corporations. Susan's
Annual Bonus shall be payable in cash or, if agreed to by Susan, the Board of
Directors of the Corporation and the Board of Directors of Financial Performance
Corporation ("FPC"), such amount may be payable, in whole or in part, in options
or warrants to acquire common stock or other securities of FPC (hereinafter, the
"Bonus Securities") which shall have typical "piggy-back" registration rights
and which shall contain such other terms and conditions, including, without
limitation, term, exercise price and number of securities issued, as the Board
of Directors of the Corporation and FPC shall jointly reasonably determine
represents equivalent value to the cash bonus or portion thereof which would
otherwise be payable to Susan. Further, during the six (6) month period
commencing on the date of issuance of the Bonus Securities (hereinafter, the
"Sales Period") FPC shall use its reasonable efforts together with the
investment banking firms then providing financial services to FPC, to the extent
reasonably practicable and appropriate, to assist Susan in arranging for the
exercise and sale of the Bonus Securities. The term "Bonus Securities", as used
herein, shall mean and include all options, warrants, common stock or other
securities of FPC issued to Susan in full or partial payment of Susan's Annual
Bonus and, in the case of derivative securities such as options and warrants,
all of the common stock underlying such derivative securities. The "piggy-back"
registration rights referred to above shall apply to all common stock underlying
any derivative securities and shall obligate FPC to register such stock at such
time as FPC registers other common stock in connection with a public offering of
securities, at FPC's sole cost and expense.
(c) If (i) Susan shall exercise and sell all of the Bonus Securities
during the Sales Period and (ii) the aggregate gross sales price received by
Susan for the sale of the Bonus Securities less the aggregate amount of all
warrant or option exercise consideration in respect of the Bonus Securities paid
by Susan to FPC during the Sales Period (hereinafter, the "Gross Sales
Proceeds") shall be less than the agreed-upon equivalent cash value of Susan's
Bonus which shall have been paid by issuance of the Bonus Securities as set
forth in subsection (b) above (hereinafter, the "Equivalent Cash Value"), then
within thirty (30) days after the Corporation's receipt from Susan of notice
thereof setting forth, in reasonable detail, the calculation of such difference
together with copies of all pertinent supporting documentation relating thereto,
the Corporation shall pay to Susan, in cash, an amount (hereinafter, the
"Shortfall") equal to the difference between the Equivalent Cash Value and the
Gross Sales Proceeds. The Corporation shall not be obligated to make payment of
the Shortfall to Susan unless all of the Bonus Securities are exercised and sold
by Susan prior to the expiration of the Sales Period.
6. Employment Benefits. Susan shall be entitled to four (4) weeks vacation
for each one (1) year of Susan's employment pursuant to this agreement, during
which Susan's salary shall be
3
<PAGE> 4
paid in full. Susan shall be entitled to reimbursement of reasonable
out-of-pocket business expenses incurred on behalf of the Corporation, provided
that such expenses are reasonably necessary and are properly documented. Susan
shall be entitled to privileges under any retirement, pension, long-term or
short-term disability insurance plan which may hereafter be adopted by the
Corporation for the benefit of its employees. The Corporation agrees to provide
Susan with and shall pay all premiums for family coverage under a group health
insurance plan reasonably comparable to the coverage currently provided to Susan
by the Corporation, to the extent same is reasonably obtainable by the
Corporation. The Corporation shall also provide Susan with (i) a clothing
expense allowance in the amount of ten thousand and 00/100 ($10,000.00) dollars
for the first year of the Term and fifteen thousand and 00/100 ($15,000.00)
dollars for each remaining year of the Term and (ii) a leased automobile of
Susan's choice throughout the Term.
7. Termination.
(a) The Corporation may, at its election in accordance with the procedures
more particularly set forth below, terminate this agreement for cause. For
purposes of this agreement, "cause" shall be defined as and limited to the
following: (i) a material breach by Susan of any material term of this agreement
which causes substantial damage to the reputation, business or property of the
Corporation, any of the Corporation's affiliates or any of the Corporation's (or
any affiliate's) customers and which shall not have been cured within thirty
(30) days of receipt by Susan of notice of such breach; (ii) a continued failure
of Susan after thirty (30) days' notice of a prior failure to devote Susan's
full active business time (as more particularly described in Section 4 above) to
the performance of Susan's duties hereunder; (iii) an act of willful misconduct
in the performance of Susan's duties hereunder which causes substantial damage
to the reputation, business or property of the Corporation, any of the
Corporation's affiliates or any of the Corporation's customers including,
without limitation, any oral or written misrepresentation relating to the
Corporation or any of the Corporation's (or any affiliate's) customers; (iv)
conviction of a felony; or (v) substantial, continuing and willful improper
performance or non-performance of any of Susan's material duties hereunder. For
purposes of this subsection (a), no act, or failure to act, on Susan's part
shall be considered "willful" unless done, or omitted to be done, by her not in
good faith or without reasonable belief that her action or omission was in the
best interests of the Corporation. Notwithstanding the foregoing, Susan shall
not be deemed to have been terminated for cause without (i) thirty (30) days'
notice to Susan setting forth the reasons for the Corporation's intention to
terminate for cause, (ii) an opportunity for Susan, together with her counsel,
to be heard before the Corporation's board of directors, and (iii) delivery to
Susan of a Notice of Termination as defined in subsection (d) below from an
executive officer of the Corporation finding that in the good faith opinion of
the Corporation's Board of Directors or in the good faith opinion of the Board
of Directors of FPC, Susan was guilty of conduct set forth or described above in
justifying the Corporation's termination of Susan's employment for cause and
specifying the particulars thereof in detail.
(b) Susan may terminate her employment under this agreement for Good
Reason (as hereinafter defined). For purposes of this agreement, "Good Reason"
shall mean (i) a Change of Control (as defined below) of the Corporation or of
FPC which shall have been in effect for a period of at least ninety (90)
consecutive days; provided, however, that at any time within six months of the
date of this Agreement Susan shall be unable to work harmoniously and
4
<PAGE> 5
effectively with the personnel constituting the new management of the
Corporation or FPC resulting from such Change of Control (if any), in the case
of FPC, only to the extent that such inability relates to matters solely
relating to the management and operations of the Corporation, (ii) a failure by
the Corporation to comply with any material provision of this agreement which
noncompliance shall have a material adverse effect upon Susan and which shall
not have been cured within thirty (30) days after notice of such noncompliance
has been given by Susan to the Corporation pursuant to this agreement, (iii) if
Susan's management functions, duties or responsibilities or any other material
aspect of Susan's employment shall have been materially and adversely changed by
the Corporation for a period in excess of thirty (30) consecutive days
notwithstanding Susan's written objection thereto or (iv) any purported
termination of Susan's employment which is not properly effected pursuant to a
Notice of Termination satisfying the requirements of subsection (d) below (and
for purposes of this agreement no such purported termination shall be
effective).
(c) For the purpose of this agreement, a "Change of Control" shall be
deemed to have taken place if: (i) a third person, including a "group" as such
term is defined in Section 13(d)(3) of the Securities Exchange Act of 1934,
becomes (other than as a result of a purchase from the Corporation) the
beneficial owner of shares of the Corporation or of FPC having more than thirty
(30%) percent of the total number of votes that may be cast for the election of
directors of the Corporation or of FPC and such beneficial ownership continues
for thirty (30) consecutive days, or (ii) as a result of, or in connection with,
any cash tender or exchange offer, merger or other business combination of the
foregoing transactions relating to the Corporation or to FPC (hereinafter
referred to as a "Transaction") the persons who were directors of the
Corporation or of FPC before the Transaction shall cease for any reason to
constitute at least a majority of the Board of Directors of the Corporation or
of FPC, as the case may be, or any successor(s) of either of such entities. For
purposes of this Section 7, the acquisition on the date hereof by each of
Messrs. Jeffrey Silverman and Ronald Nash of a portion of Robert Trump's
interest in FPC shall be deemed a "Change of Control" subject to the provisions
of subsection 7(b).
(d) Any termination of Susan's employment by the Corporation or by Susan
(other than termination by reason of Susan's death or disability as set forth in
Section 14 below) shall be communicated by written Notice of Termination to the
other party hereto. For purposes of this agreement, a "Notice of Termination"
shall mean a notice which shall indicate the specific termination provision in
this agreement relied upon and shall set forth in reasonable detail the facts
and circumstances claimed to provide a basis for termination of Susan's
employment under the provision so indicated.
(e) "Date of Termination" shall mean (i) if Susan's employment is
terminated by her death, the date of her death, (ii) if Susan's employment is
terminated pursuant to subsection (c) above, the date specified in the Notice of
Termination, and (iii) if Susan's employment is terminated for any other reason,
the date on which a Notice of Termination is given; provided that if within
thirty (30) days after any Notice of Termination is given the party receiving
such Notice of Termination notifies the other party that a dispute exists
concerning the termination, the Date of Termination shall be the date on which
the dispute is finally determined, either by mutual written agreement of the
parties, by a binding and final arbitration award or by a final judgment, order
or decree of a court of competent jurisdiction (the time for appeal therefrom
having expired and no appeal having been perfected).
5
<PAGE> 6
8. Compensation Upon Termination or During Disability.
(a) During any period that Susan fails to perform her duties hereunder as
a result of incapacity due to physical or mental illness ("disability period"),
Susan shall continue to receive her full salary at the rate then in effect for
such period and all employment benefits due to Susan until her employment is
terminated pursuant to Section 7 above, provided that payments so made to Susan
during the disability period shall be reduced by the sum of the amounts, if any,
payable to Susan at or prior to the time of any such payment under disability
benefit plans of the Corporation and which were not previously applied to reduce
any such payment.
(b) If Susan's employment is terminated by her death, the Corporation
shall pay to Susan's spouse, or if she leaves no spouse, to her estate, within
thirty (30) days of Susan's death, all salary and employment benefits due to
Susan accrued through the date of her death.
(c) If Susan's employment shall be properly terminated for cause pursuant
to all of the applicable provisions of this agreement, the Corporation shall pay
Susan her full salary only through the Date of Termination at the rate in effect
at the time Notice of Termination is given and the Corporation shall have no
further obligations to Susan under or pursuant to this Agreement.
(d) If (i) in breach of this agreement, the Corporation shall terminate
Susan's employment other than pursuant to subsection 7(a) above (termination for
cause) or Section 14 below (termination by reason of death or disability)(it
being understood that a purported termination by the Corporation pursuant to
subsection 7(a) above or Section 14 below which is disputed and finally
determined not to have been proper shall be deemed a termination by the
Corporation in breach of this agreement) or (ii) Susan shall terminate her
employment for Good Reason, then
(I) the Corporation shall pay Susan her full salary and all
employment benefits due to Susan through the Date of Termination at the rate in
effect at the time the Notice of Termination is given;
(II) in lieu of any further salary payments to Susan for periods
subsequent to the Date of Termination, the Corporation shall pay to Susan, as
severance pay (and not as a penalty to the Corporation), an amount equal to the
product of (A) Susan's annual base salary rate in effect as of the Date of
Termination, multiplied by (B) the number two (2), such payment to be made (X)
if resulting from a termination based on a Change of Control of the Corporation
or of FPC, in a lump sum on or before the thirtieth (30th) day following the
Date of Termination, or (Y) if resulting from any other cause, in substantially
equal semimonthly installments of the fifteenth and last days of each month
commencing with the month in which the Date of Termination occurs and continuing
for forty-eight (48) consecutive semimonthly payment dates (including the first
such date as aforesaid), without interest;
(III) in addition to the payments referred to in clause (I) and (II)
above, if termination of Susan's employment arises out of a breach by the
Corporation of this agreement, the Corporation shall also pay to Susan (i) the
severance payment of Three Hundred Fifty Thousand ($350,000.00) Dollars payable
pursuant to subsection 2(b) of this agreement plus (ii)
6
<PAGE> 7
all other damages to which Susan may be entitled as a result of such breach,
including damages for any and all loss of benefits to Susan under the
Corporation's employee benefit plans (other than the Corporation's Bonus
Compensation Plan) which Susan would have received if the Company had not
breached this agreement and had Susan's employment continued for the full term
provided in Section 2 hereof.
(e) Unless Susan's employment is properly terminated by the Corporation
for cause, the Corporation shall maintain in full force and effect, for the
continued benefit of Susan for the greater of the number of years (including
partial years) remaining in the term of employment hereunder or the number two
(2), all employee benefit plans and programs in which Susan was entitled to
participate immediately prior to the Date of Termination, provided that Susan's
continued participation is possible under the general terms and provisions of
such plans and programs. In the event that Susan's participation in any such
plan or program is barred, the Corporation shall arrange to provide Susan with
benefits substantially similar to those which Susan would otherwise have been
entitled to receive under such plans and programs from which her continued
participation is barred.
(f) Unless Susan's employment is properly terminated by the Corporation
for cause, Susan's Annual Bonus shall continue to be paid after the Date of
Termination for a period not to exceed six (6) months with respect to all
unfinished projects for which the Corporation shall have been engaged as of the
Date of Termination. The amount of Susan's Annual Bonus payable subsequent to
the Date of Termination as aforesaid shall be based upon the Corporation's net
profits before taxes which are allocable to such projects, as determined by the
Corporation's outside accounting firm, subject to review and approval by the
accounting firm which prepares the consolidated financial statements for all of
the companies affiliated with FPC, in accordance with generally accepted
accounting principles, consistently applied, as if the Corporation were not a
member of an affiliated group of corporations.
(g) The Corporation may withhold from any payments or other benefits
payable to Susan pursuant to this Section 8 or any other provision of this
agreement all federal, state, city or other taxes as shall be required pursuant
to any law, government regulation or ruling.
9. Disclosure of Information. Susan recognizes and acknowledges that the
Corporation's trade secrets and know-how as they may exist from time to time
are a valuable, special and unique asset of the Corporation's business,
access to and knowledge of which are essential to the performance of Susan's
duties hereunder. For the purposes of this agreement, Confidential
Information includes any and all information (i) disclosed or made available
to Susan or known by Susan in consequence of or through the employment of
Susan by the Corporation and not generally known in the industry in which the
Corporation or any of the Corporation's customers is or may be engaged, or
which is beneficial to the Corporation, or any of the Corporation's customers
in the promotion or operation of their respective businesses, (ii) relating
to the business, business practices, operation, affairs, practices,
procedures, policies or methods of the Corporation, (iii) constituting
customer lists, (iv) constituting marketing information and (v) constituting
training materials. The term "Confidential Information" does not include
information that is known to the public other than as a result of a
disclosure by you or any other person or entity which has a confidentiality
obligation to the Corporation or FPC with respect to such information. Since
the services of Susan are unique, extra-ordinary and of a specialized
7
<PAGE> 8
character which will require Susan to handle Confidential Information of the
Corporation and of the Corporation's suppliers and customers, Susan shall
not, at any time during the term of this agreement or thereafter, make use of
any Confidential Information for the benefit of any person or entity (other
than the Corporation) nor shall Susan disclose any Confidential Information
to any person or entity for any reason or purpose whatsoever.
Notwithstanding the foregoing, this paragraph 9 shall not be applicable in
the event (i) Susan terminates her employment for Good Reason as defined in
subparagraph 7(b) hereof; (ii) the Corporation terminates this Agreement
other than "cause"; or (iii) the Corporation elects not to renew this
agreement for any reason at the expiration of the Term or a Renewal Term.
10. Covenant Not to Solicit. Susan, either as a proprietor, partner, employee,
agent, consultant, director, officer, controlling stockholder or in any other
capacity or manner whatsoever, for a period of one (1) year after the date of
expiration or other termination of this agreement, shall not interfere with,
disrupt, or attempt to disrupt the relationship, contractual or otherwise,
between the Corporation and any customer, client, employee or independent
contractor of the Corporation or provide any services to, as the case may be,
any accounts, clients or customers of the Corporation (or any accounts,
clients or customers which were contacted or solicited by the Corporation
during the term of this Agreement) with whom Susan had any direct or indirect
contact during her employment hereunder. Notwithstanding the foregoing, this
paragraph 10 shall not be applicable in the event (i) Susan terminates her
employment for Good Reason as defined in subparagraph 7(b) hereof; (ii) the
Corporation terminates this Agreement for a reason other than "cause"; or
(iii) the Corporation elects not to renew this Agreement at the expiration of
the Term or a Renewal Term.
11. Return of Documents. Upon termination of employment with the Corporation,
Susan shall promptly return to the Corporation all documents, notes, records
and other materials of the Corporation in Susan's possession, whether
prepared by Susan or others, including, without limitation all materials and
information stored on computer disk or other electronic media; provided that
the foregoing restriction shall not apply in the event (i) Susan terminates
her employment for Good Reason as defined in subparagraph 7(b) hereof; (ii)
the Corporation terminates this Agreement for a reason other than "cause"; or
(iii) the Corporation elects not to renew this Agreement at the expiration of
the Term or a Renewal Term, with respect to any documents, notes, records and
other materials of the Corporation which are needed by Susan to operate any
business engaged in by Susan upon termination of this Agreement (the
"Retained Materials"); provided, however, that Susan shall deliver a copy of
all such Retained Materials to the Corporation within ten (10) days of the
date of termination of Susan's employment.
12. Enforcement of Non-Disclosure and Non-Solicitation Provisions. It is the
desire and intent of the par-ties that the provisions of Sections 9, 10 and
11 shall be enforced to the fullest extent permissible under the laws and
public policies applied in each jurisdiction in which enforcement is sought.
Accordingly, if any portion or portions of such Sections 9, 10 or 11 shall be
adjudicated to be invalid or unenforceable, such Sections shall be deemed
amended to delete therefrom the portion or portions thus adjudicated to be
invalid or unenforceable, such deletion to apply only with respect to the
operation of such Sections in the particular jurisdiction in which such
adjudication is made. The provisions of Sections 9, 10, 11 and 13 shall
survive the expiration or earlier termination of this agreement.
8
<PAGE> 9
13. Injunctive Relief. If there is a breach or threatened breach of any of the
provisions of Sections 9, 10 or 11 of this agreement, the Corporation shall
be entitled to an injunction restraining Susan from such breach. Nothing
herein shall be construed as prohibiting the Corporation from pursuing any
other remedies for such breach or threatened breach.
14. Disability/Death. Susan's employment under this agreement shall terminate
upon the death or, at the election of the Corporation, the physical or mental
disability of Susan. For purposes of this agreement, Susan shall be deemed
to be disabled if she is unable to perform her services for twelve (12)
consecutive months. If the Corporation elects to terminate this agreement
pursuant to this Section 14, the Corporation shall notify Susan of the
Corporation's decision to terminate Susan's employment hereunder by means of
a Notice of Termination pursuant to the provisions of subsection (d) of
Section 7 above. From and after such termination of employment of Susan
pursuant to this Section 14, Susan's compensation and rights thereto and all
of Susan's other rights under this agreement shall terminate except as
otherwise specifically set forth in Section 8 above.
15. Notices. Any notice required or permitted to be given under this agreement
shall be sufficient if in writing and if sent by certified mail, return
receipt requested, to Susan's mailing address set forth above, or by personal
delivery to Susan, in the case of Susan, to its office address set forth
above, in the case of the Corporation, with a copy sent in like manner to
such counsel as the Corporation shall designate by written notice to Susan.
Notices shall be deemed given two (2) business days after mailing, or on the
date personal delivery is effected, as the case may be.
16. Waiver of Breach. The waiver by any party of a breach of any provision of
this agreement by the other party shall not operate or be construed as a
waiver of any subsequent or other breach by the other party. Any waiver must
be in writing.
17. Entire Agreement. This instrument contains the entire agreement of the
parties. It may not be waived, changed, modified or extended orally but only
by an agreement in writing signed by the party against whom enforcement of
any waiver, change, modification or extension is sought.
19. Applicable Law. This agreement shall be governed by and construed and
enforced in accordance with the internal laws of the State of New York
without regard to the application of conflict of laws.
19. Severability. If any provision of this agreement is found to be void or
unenforceable by a court of competent jurisdiction, the remaining provisions
of this agreement shall nevertheless be binding upon the Corporation and
Susan with the same effect as though the void or unenforceable provision had
been severed and deleted.
20. Conflict. If any provision of this agreement is found to be in conflict
with any provision of any other agreement to which the Corporation and Susan are
parties, the provision of such other agreement shall control.
21. Arbitration. If any dispute shall arise between the Corporation and Susan
with regard to this agreement, such dispute shall be promptly submitted to
and decided by arbitration by the
9
<PAGE> 10
American Arbitration Association in the City and County of New York in
accordance with the Expedited Procedures of the Commercial Arbitration Rules of
the American Arbitration Association. The award rendered by the arbitrators
shall be final, shall include an award of reasonable legal fees and costs to the
prevailing party as determined by the arbitrator(s) and judgment may be entered
upon the award in accordance with applicable law in any court having
jurisdiction.
22. Prior Managing Director's Agreements. Notwithstanding anything to the
contrary, any prior Managing Director's Agreement between the Corporation and
Susan (including, without limitation, the Old Agreement) is hereby deemed
terminated and is superseded in all respects by this agreement.
In witness whereof, the parties hereto have caused this agreement to be
duly executed as of the day and year first above written.
Corporation:
Michaelson Kelbick Partners Inc.
By:
--------------------------------
Hillary Kelbick
Managing Director
By:
--------------------------------
Susan Michaelson
Managing Director
-----------------------------------
Susan Michaelson
The provisions of Sections 5(b) and 5(c)
relating to the possible issuance of
Bonus Securities are hereby consented to:
Financial Performance Corporation
By:
----------------------------
William F. Finley, President
10
<PAGE> 1
EXHIBIT 10.16
RESTATED AND AMENDED MANAGING DIRECTOR'S AGREEMENT
Agreement made as of November 16, 1999, by and between Michaelson Kelbick
Partners Inc., a New York corporation with offices at 335 Madison Avenue, 8th
Floor, New York, New York 10017(the "Corporation") and Hillary Kelbick,
residing at _____________________________ ("Hillary").
W I T N E S S E T H:
Whereas, Hillary and the Corporation are parties to a Restated and Amended
Managing Director's Agreement dated as of June 18, 1999 (the "Old Agreement").
Whereas, the Corporation and Hillary desire to amend and restate the Old
Agreement in the manner and on the terms and conditions set forth below.
Now, therefore, in consideration of the premises, the mutual covenants
hereinafter set forth, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereby
amend and restate the Old Agreement as follows:
1. Employment. The Corporation hereby continues its employment of Hillary for
the Term (as hereinafter defined) and Hillary hereby accepts such employment
upon the terms and conditions hereinafter set forth.
2. Term.
(a) The Term of this agreement is three (3) years, commencing on September
11, 1997 and ending on September 10, 2000 (the "Term"), unless earlier
terminated by the Corporation or by Hillary in accordance with the provisions
hereof. This agreement shall be automatically renewed for periods of one (1)
year each (the "Renewal Term") unless either party shall give the other notice
of her or its desire to terminate this agreement no later than on the June 1st
immediately preceding the expiration of the then current term, in which event
Hillary's employment shall terminate at the end of the Term or the applicable
Renewal Term, as the case may be. The Term and the Renewal Term are hereinafter
collectively referred to as the Term.
(b) If Hillary has not given notice to the Corporation on or before
June 1, 2000 that she elects not to renew this agreement at the expiration of
the Term and the Corporation gives notice to Hillary that it elects not to renew
this agreement at the expiration of the Term, then and only in such event,
provided that Hillary's employment is not properly terminated by the Corporation
for cause pursuant to and in accordance with the provisions of Section 7 below,
in addition to and without limitation of any other compensation, severance
payments or employment benefits which may be or become due from the Corporation
to Hillary pursuant to this agreement (but not in addition to any severance
payment which may be due pursuant to the provisions of subparagraph (c) of this
Section 2, it being understood that such severance payment and the severance
payment payable pursuant to this subparagraph (b) are mutually exclusive), the
Corporation shall pay to Hillary, within ten (10) days following the expiration
of the Term, a severance payment in the amount of Three Hundred Fifty Thousand
($350,000.00) Dollars.
<PAGE> 2
(c) If Hillary elects not to renew this Agreement at the expiration of the
Term and Hillary's employment is not properly terminated by the Corporation for
cause pursuant to and in accordance with the provisions of Section 7 below, then
and only in such event, in addition to and without limitation of any other
compensation, severance payments or employment benefits which may be or become
due from the Corporation to Hillary pursuant to this agreement (but not in
addition to any severance payment which may be due pursuant to the provisions of
subparagraph (b) of this Section 2, it being understood that such severance
payment and the severance payment payable pursuant to this subparagraph (c) are
mutually exclusive), the Corporation shall pay to Hillary, within ten (10) days
following the expiration of the Term, a severance payment in the amount of Two
Hundred Fifty Thousand ($250,000.00) Dollars.
(d) For purposes of this agreement, the term "employment benefits" shall
be deemed to include Hillary's Annual Bonus (as such term is hereinafter
defined).
3. Duties. Hillary is engaged for the term hereof as a Managing Director of
the Corporation and shall perform and discharge well and faithfully the duties
which may be undertaken by Hillary in such capacity from time to time, such
duties to be substantially similar to the duties heretofore undertaken by
Hillary as a Managing Director of the Corporation. The duties of Hillary shall
include jointly managing with Susan Michaelson or her successor ("Susan"), the
Corporation's day-to-day operations, including, with-out limitation, hiring,
training, supervising and terminating employees, determining employee
compensation (including incentives) and employment policy, including assignment
of employees' duties and how same are to be performed, all aspects of client
relationships, and maintaining the Corporation's books and records, serving as a
member of the Board of Directors and any other duties as may be determined by
the Board of Directors; it being the intent of the parties that Hillary and
Susan shall together exercise full management control of the day-to-day
operations of the Corporation for so long as both Susan and Hillary are employed
by the Corporation.
4. Extent of Services. During the period in which Hillary is employed by the
Corporation, Hillary shall devote Hillary's entire active business time, best
efforts, attention, skill and energies to the business of the Corporation and
shall not during such period be engaged in any other business activity
pursued for gain, profit or other pecuniary advantage; but this shall not be
construed as preventing Hillary from investing Hillary's personal assets in
businesses which do not compete with the Corporation in such form or manner
as will not require any active business services on the part of Hillary in
the operation of the affairs of the companies in which such investments are
made and in which Hillary's participation is solely that of a passive
investor.
5. Compensation.
(a) For all services rendered by Hillary pursuant to this agreement, the
Corporation shall pay Hillary an annual salary payable biweekly, in arrears,
as follows: (i) One Hundred Fifty Thousand ($150,000.00) Dollars per annum
during the period commencing on September 11, 1997 through September 30,
1998; and (ii) Two Hundred Fifty Thousand ($250,000.00) Dollars per annum
during the period commencing on October 1, 1998 through the balance of the
Term. Such salary shall be subject to periodic increases as shall be
determined by the Board of Directors of the Corporation.
2
<PAGE> 3
(b) Hillary shall be eligible to participate in the Corporation's annual
incentive compensation pool (the "Bonus Pool") in an amount to be determined
annually by the Corporation's Board of Directors based upon the joint
recommendation of Hillary and Susan. The portion of the Bonus Pool to which
Hillary shall become entitled for any fiscal year of the Corporation is
hereinafter referred to as "Hillary's Annual Bonus". For any fiscal year of
the Corporation, the Bonus Pool shall not exceed in the aggregate an amount
equal to thirty (30%) percent of the Corporation's annual net profits before
taxes determined by the Corporation's outside accounting firm, subject to
review and approval by the accounting firm which prepares the consolidated
financial statements for all of the companies affiliated with FPC, in
accordance with generally accepted accounting principles, consistently
applied, as if the Corporation were not a member of an affiliated group of
corporations. Hillary's Annual Bonus shall be payable in cash or, if agreed
to by Hillary, the Board of Directors of the Corporation and the Board of
Directors of Financial Performance Corporation ("FPC"), such amount may be
payable, in whole or in part, in options or warrants to acquire common stock
or other securities of FPC (hereinafter, the "Bonus Securities") which shall
have typical "piggy-back" registration rights and which shall contain such
other terms and conditions, including, without limitation, term, exercise
price and number of securities issued, as the Board of Directors of the
Corporation and FPC shall jointly reasonably determine represents equivalent
value to the cash bonus or portion thereof which would otherwise be payable
to Hillary. Further, during the six (6) month period commencing on the date
of issuance of the Bonus Securities (hereinafter, the "Sales Period") FPC
shall use its reasonable efforts together with the investment banking firms
then providing financial services to FPC, to the extent reasonably
practicable and appropriate, to assist Hillary in arranging for the exercise
and sale of the Bonus Securities. The term "Bonus Securities", as used
herein, shall mean and include all options, warrants, common stock or other
securities of FPC issued to Hillary in full or partial payment of Hillary's
Annual Bonus and, in the case of derivative securities such as options and
warrants, all of the common stock underlying such derivative securities. The
"piggy-back" registration rights referred to above shall apply to all common
stock underlying any derivative securities and shall obligate FPC to register
such stock at such time as FPC registers other common stock in connection
with a public offering of securities, at FPC's sole cost and expense.
(c) If (i) Hillary shall exercise and sell all of the Bonus Securities
during the Sales Period and (ii) the aggregate gross sales price received by
Hillary for the sale of the Bonus Securities less the aggregate amount of all
warrant or option exercise consideration in respect of the Bonus Securities paid
by Hillary to FPC during the Sales Period (hereinafter, the "Gross Sales
Proceeds") shall be less than the agreed-upon equivalent cash value of Hillary's
Bonus which shall have been paid by issuance of the Bonus Securities as set
forth in subsection (b) above (hereinafter, the "Equivalent Cash Value"), then
within thirty (30) days after the Corporation's receipt from Hillary of notice
thereof setting forth, in reasonable detail, the calculation of such difference
together with copies of all pertinent supporting documentation relating thereto,
the Corporation shall pay to Hillary, in cash, an amount (hereinafter, the
"Shortfall") equal to the difference between the Equivalent Cash Value and the
Gross Sales Proceeds. The Corporation shall not be obligated to make payment of
the Shortfall to Hillary unless all of the Bonus Securities are exercised and
sold by Hillary prior to the expiration of the Sales Period.
3
<PAGE> 4
6. Employment Benefits. Hillary shall be entitled to four (4) weeks vacation
for each one (1) year of Hillary's employment pursuant to this agreement,
during which Hillary's salary shall be paid in full. Hillary shall be
entitled to reimbursement of reasonable out-of-pocket business expenses
incurred on behalf of the Corporation, provided that such expenses are
reasonably necessary and are properly documented. Hillary shall be entitled
to privileges under any retirement, pension, long-term or short-term
disability insurance plan which may hereafter be adopted by the Corporation
for the benefit of its employees. The Corporation agrees to provide Hillary
with and shall pay all premiums for family coverage under a group health
insurance plan reasonably comparable to the coverage currently provided to
Hillary by the Corporation, to the extent same is reasonably obtainable by
the Corporation. The Corporation shall also provide Hillary with (i) a
clothing expense allowance in the amount of ten thousand and 00/100
($10,000.00) dollars for the first year of the Term and fifteen thousand and
00/100 ($15,000.00) dollars for each remaining year of the Term and (ii) a
leased automobile of Hillary's choice throughout the Term.
7. Termination.
(a) The Corporation may, at its election in accordance with the procedures
more particularly set forth below, terminate this agreement for cause. For
purposes of this agreement, "cause" shall be defined as and limited to the
following: (i) a material breach by Hillary of any material term of this
agreement which causes substantial damage to the reputation, business or
property of the Corporation, any of the Corporation's affiliates or any of the
Corporation's (or any affiliate's) customers and which shall not have been cured
within thirty (30) days of receipt by Hillary of notice of such breach; (ii) a
continued failure of Hillary after thirty (30) days' notice of a prior failure
to devote Hillary's full active business time (as more particularly described in
Section 4 above) to the performance of Hillary's duties hereunder; (iii) an act
of willful misconduct in the performance of Hillary's duties hereunder which
causes substantial damage to the reputation, business or property of the
Corporation, any of the Corporation's affiliates or any of the Corporation's
customers including, without limitation, any oral or written misrepresentation
relating to the Corporation or any of the Corporation's (or any affiliate's)
customers; (iv) conviction of a felony; or (v) substantial, continuing and
willful improper performance or non-performance of any of Hillary's material
duties hereunder. For purposes of this subsection (a), no act, or failure to
act, on Hillary's part shall be considered "willful" unless done, or omitted to
be done, by her not in good faith or without reasonable belief that her action
or omission was in the best interests of the Corporation. Notwithstanding the
foregoing, Hillary shall not be deemed to have been terminated for cause without
(i) thirty (30) days' notice to Hillary setting forth the reasons for the
Corporation's intention to terminate for cause, (ii) an opportunity for Hillary,
together with her counsel, to be heard before the Corporation's board of
directors, and (iii) delivery to Hillary of a Notice of Termination as defined
in subsection (d) below from an executive officer of the Corporation finding
that in the good faith opinion of the Corporation's Board of Directors or in the
good faith opinion of the Board of Directors of FPC, Hillary was guilty of
conduct set forth or described above in justifying the Corporation's termination
of Hillary's employment for cause and specifying the particulars thereof in
detail.
(b) Hillary may terminate her employment under this agreement for Good
Reason (as hereinafter defined). For purposes of this agreement, "Good Reason"
shall mean (i) a Change of Control (as defined below) of the Corporation or of
FPC which shall have been in effect for a
4
<PAGE> 5
period of at least ninety (90) consecutive days; provided, however, that at any
time within six months of the date of this Agreement Hillary shall be unable to
work harmoniously and effectively with the personnel constituting the new
management of the Corporation or FPC resulting from such Change of Control (if
any) in the case of FPC, only to the extent that such inability relates to
matters solely relating to the management and operations of the Corporation,
(ii) a failure by the Corporation to comply with any material provision of this
agreement which noncompliance shall have a material adverse effect upon Hillary
and which shall not have been cured within thirty (30) days after notice of such
noncompliance has been given by Hillary to the Corporation pursuant to this
agreement, (iii) if Hillary's management functions, duties or responsibilities
or any other material aspect of Hillary's employment shall have been materially
and adversely changed by the Corporation for a period in excess of thirty (30)
consecutive days notwithstanding Hillary's written objection thereto or (iv) any
purported termination of Hillary's employment which is not properly effected
pursuant to a Notice of Termination satisfying the requirements of subsection
(d) below (and for purposes of this agreement no such purported termination
shall be effective).
(c) For the purpose of this agreement, a "Change of Control" shall be
deemed to have taken place if: (i) a third person, including a "group" as such
term is defined in Section 13(d)(3) of the Securities Exchange Act of 1934,
becomes (other than as a result of a purchase from the Corporation) the
beneficial owner of shares of the Corporation or of FPC having more than thirty
(30%) percent of the total number of votes that may be cast for the election of
directors of the Corporation or of FPC and such beneficial ownership continues
for thirty (30) consecutive days, or (ii) as a result of, or in connection with,
any cash tender or exchange offer, merger or other business combination of the
foregoing transactions relating to the Corporation or to FPC (hereinafter
referred to as a "Transaction") the persons who were directors of the
Corporation or of FPC before the Transaction shall cease for any reason to
constitute at least a majority of the Board of Directors of the Corporation or
of FPC, as the case may be, or any successor(s) of either of such entities. For
purposes of this Section 7, the acquisition on the date hereof by each of
Messrs. Jeffrey Silverman and Ronald Nash of a portion of Robert Trump's
interest in FPC shall be deemed a "Change of Control" subject to the provisions
of subsection 7(b).
(d) Any termination of Hillary's employment by the Corporation or by
Hillary (other than termination by reason of Hillary's death or disability as
set forth in Section 14 below) shall be communicated by written Notice of
Termination to the other party hereto. For purposes of this agreement, a "Notice
of Termination" shall mean a notice which shall indicate the specific
termination provision in this agreement relied upon and shall set forth in
reasonable detail the facts and circumstances claimed to provide a basis for
termination of Hillary's employment under the provision so indicated.
(e) "Date of Termination" shall mean (i) if Hillary's employment is
terminated by her death, the date of her death, (ii) if Hillary's employment is
terminated pursuant to subsection (c) above, the date specified in the Notice of
Termination, and (iii) if Hillary's employment is terminated for any other
reason, the date on which a Notice of Termination is given; provided that if
within thirty (30) days after any Notice of Termination is given the party
receiving such Notice of Termination notifies the other party that a dispute
exists concerning the termination, the Date of Termination shall be the date on
which the dispute is finally determined, either by mutual written agreement of
the parties, by a binding and final arbitration award or by a final
5
<PAGE> 6
judgment, order or decree of a court of competent jurisdiction (the time for
appeal therefrom having expired and no appeal having been perfected).
8. Compensation Upon Termination or During Disability.
(a) During any period that Hillary fails to perform her duties hereunder
as a result of incapacity due to physical or mental illness ("disability
period"), Hillary shall continue to receive her full salary at the rate then in
effect for such period and all employment benefits due to Hillary until her
employment is terminated pursuant to Section 7 above, provided that payments so
made to Hillary during the disability period shall be reduced by the sum of the
amounts, if any, payable to Hillary at or prior to the time of any such payment
under disability benefit plans of the Corporation and which were not previously
applied to reduce any such payment.
(b) If Hillary's employment is terminated by her death, the Corporation
shall pay to Hillary's spouse, or if she leaves no spouse, to her estate, within
thirty (30) days of Hillary's death, all salary and employment benefits due to
Hillary accrued through the date of her death.
(c) If Hillary's employment shall be properly terminated for cause
pursuant to all of the applicable provisions of this agreement, the Corporation
shall pay Hillary her full salary only through the Date of Termination at the
rate in effect at the time Notice of Termination is given and the Corporation
shall have no further obligations to Hillary under or pursuant to this
Agreement.
(d) If (i) in breach of this agreement, the Corporation shall terminate
Hillary's employment other than pursuant to subsection 7(a) above (termination
for cause) or Section 14 below (termination by reason of death or disability)(it
being understood that a purported termination by the Corporation pursuant to
subsection 7(a) above or Section 14 below which is disputed and finally
determined not to have been proper shall be deemed a termination by the
Corporation in breach of this agreement) or (ii) Hillary shall terminate her
employment for Good Reason, then
(I) the Corporation shall pay Hillary her full salary and all
employment benefits due to Hillary through the Date of Termination at the rate
in effect at the time the Notice of Termination is given;
(II) in lieu of any further salary payments to Hillary for periods
subsequent to the Date of Termination, the Corporation shall pay to Hillary, as
severance pay (and not as a penalty to the Corporation), an amount equal to the
product of (A) Hillary's annual base salary rate in effect as of the Date of
Termination, multiplied by (B) the number two (2), such payment to be made (X)
if resulting from a termination based on a Change of Control of the Corporation
or of FPC in a lump sum on or before the thirtieth (30th) day following the Date
of Termination, or (Y) if resulting from any other cause, in substantially equal
semi-monthly installments on the fifteenth and last days of each month
commencing with the month in which the Date of Termination occurs and continuing
for forty-eight (48) consecutive semimonthly payment dates (including the first
such date as aforesaid), without interest;
(III) in addition to the payments referred to in clause (I) and (II)
above, if termination of Hillary's employment arises out of a breach by the
Corporation of this agreement,
6
<PAGE> 7
the Corporation shall also pay to Hillary (i) the severance payment of Three
Hundred Fifty Thousand ($350,000.00) Dollars payable pursuant to subsection 2(b)
of this agreement plus (ii) all other damages to which Hillary may be entitled
as a result of such breach, including damages for any and all loss of benefits
to Hillary under the Corporation's employee benefit plans (other than the
Corporation's Bonus Compensation Plan) which Hillary would have received if the
Company had not breached this agreement and had Hillary's employment continued
for the full term provided in Section 2 hereof.
(e) Unless Hillary's employment is properly terminated by the Corporation
for cause, the Corporation shall maintain in full force and effect, for the
continued benefit of Hillary for the greater of the number of years (including
partial years) remaining in the term of employment hereunder or the number two
(2), all employee benefit plans and programs in which Hillary was entitled to
participate immediately prior to the Date of Termination, provided that
Hillary's continued participation is possible under the general terms and
provisions of such plans and programs. In the event that Hillary's participation
in any such plan or program is barred, the Corporation shall arrange to provide
Hillary with benefits substantially similar to those which Hillary would
otherwise have been entitled to receive under such plans and programs from which
her continued participation is barred.
(f) Unless Hillary's employment is properly terminated by the Corporation
for cause, Hillary's Annual Bonus shall continue to be paid after the Date of
Termination for a period not to exceed six (6) months with respect to all
unfinished projects for which the Corporation shall have been engaged as of the
Date of Termination. The amount of Hillary's Annual Bonus payable subsequent to
the Date of Termination as aforesaid shall be based upon the Corporation's net
profits before taxes which are allocable to such projects, as determined by the
Corporation's outside accounting firm, subject to review and approval by the
accounting firm which prepares the consolidated financial statements for all of
the companies affiliated with FPC, in accordance with generally accepted
accounting principles, consistently applied, as if the Corporation were not a
member of an affiliated group of corporations.
(g) The Corporation may withhold from any payments or other benefits
payable to Hillary pursuant to this Section 8 or any other provision of this
agreement all federal, state, city or other taxes as shall be required pursuant
to any law, government regulation or ruling.
9. Disclosure of Information. Hillary recognizes and acknowledges that the
Corporation's trade secrets and know-how as they may exist from time to time
are a valuable, special and unique asset of the Corporation's business,
access to and knowledge of which are essential to the performance of
Hillary's duties hereunder. For the purposes of this agreement, Confidential
Information includes any and all information (i) disclosed or made available
to Hillary or known by Hillary in consequence of or through the employment of
Hillary by the Corporation and not generally known in the industry in which
the Corporation or any of the Corporation's customers is or may be engaged,
or which is beneficial to the Corporation, or any of the Corporation's
customers in the promotion or operation of their respective businesses, (ii)
relating to the business, business practices, operation, affairs, practices,
procedures, policies or methods of the Corporation, (iii) constituting
customer lists, (iv) constituting marketing information and (v) constituting
training materials. The term "Confidential Information" does not include
information that is known to the public other than as a result of a
disclosure by you or any other
7
<PAGE> 8
person or entity which has a confidentiality obligation to the Corporation or
FPC with respect to such information. Since the services of Hillary are unique,
extra-ordinary and of a specialized character which will require Hillary to
handle Confidential Information of the Corporation and of the Corporation's
suppliers and customers, Hillary shall not, at any time during the term of this
agreement or thereafter, make use of any Confidential Information for the
benefit of any person or entity (other than the Corporation) nor shall Hillary
disclose any Confidential Information to any person or entity for any reason or
purpose whatsoever. Notwithstanding the foregoing, this paragraph 9 shall not be
applicable in the event (i) Hillary terminates her employment for Good Reason as
defined in subparagraph 7(b) hereof; (ii) the Corporation terminates this
Agreement for a reason other than "cause"; or (iii) the Corporation elects not
to renew this Agreement at the expiration of the Term or a Renewal Term.
10. Covenant Not to Solicit. Hillary, either as a proprietor, partner,
employee, agent, consultant, director, officer, controlling stockholder or in
any other capacity or manner whatsoever, for a period of one (1) year after the
date of expiration or other termination of this agreement, shall not interfere
with, disrupt, or attempt to disrupt the relationship, contractual or otherwise,
between the Corporation and any customer, client, employee or independent
contractor of the Corporation or provide any services to, as the case may be,
any accounts, clients or customers of the Corporation (or any accounts, clients
or customers which were contacted or solicited by the Corporation during the
term of this Agreement) with whom Hillary had any direct or indirect contact
during her employment hereunder. Notwithstanding the foregoing, this paragraph
10 shall not be applicable in the event (i) Hillary terminates her employment
for Good Reason as defined in subparagraph 7(b) hereof; (ii) the Corporation
terminates this Agreement for a reason other than "cause"; or (iii) the
Corporation elects not to renew this Agreement at the expiration of the Term or
a Renewal Term.
11. Return of Documents. Upon termination of employment with the Corporation,
Hillary shall promptly return to the Corporation all documents, notes,
records and other materials of the Corporation in Hillary's possession,
whether prepared by Hillary or others, including, without limitation all
materials and information stored on computer disk or other electronic media;
provided, that the foregoing restriction shall not apply in the event (i)
Hillary terminates her employment for Good Reason as defined in subparagraph
7(b) hereof; (ii) the Corporation terminates this Agreement for a reason
other than "cause"; or (iii) the Corporation elects not to renew this
Agreement at the expiration of the Term or a Renewal Term, with respect to
any documents, notes, records and other materials of the Corporation which
are needed by Hillary to operate any business engaged in by Hillary upon
termination of this Agreement (the "Retained Materials"); provided however,
that Hillary shall deliver a copy of all such Retained Materials to the
Corporation within ten (10) days of the date of termination of Hillary's
employment.
12. Enforcement of Non-Disclosure and Non-Solicitation Provisions. It is the
desire and intent of the par-ties that the provisions of Sections 9, 10 and
11 shall be enforced to the fullest extent permissible under the laws and
public policies applied in each jurisdiction in which enforcement is sought.
Accordingly, if any portion or portions of such Sections 9, 10 or 11 shall be
adjudicated to be invalid or unenforceable, such Sections shall be deemed
amended to delete therefrom the portion or portions thus adjudicated to be
invalid or unenforceable, such deletion to apply only with respect to the
operation of such Sections in the particular jurisdiction in which
8
<PAGE> 9
such adjudication is made. The provisions of Sections 9, 10, 11 and 13 shall
survive the expiration or earlier termination of this agreement.
13. Injunctive Relief. If there is a breach or threatened breach of any of the
provisions of Sections 9, 10 or 11 of this agreement, the Corporation shall
be entitled to an injunction restraining Hillary from such breach. Nothing
herein shall be construed as prohibiting the Corporation from pursuing any
other remedies for such breach or threatened breach.
14. Disability/Death. Hillary's employment under this agreement shall
terminate upon the death or, at the election of the Corporation, the physical or
mental disability of Hillary. For purposes of this agreement, Hillary shall be
deemed to be disabled if she is unable to perform her services for twelve (12)
consecutive months. If the Corporation elects to terminate this agreement
pursuant to this Section 14, the Corporation shall notify Hillary of the
Corporation's decision to terminate Hillary's employment hereunder by means of a
Notice of Termination pursuant to the provisions of subsection (d) of Section 7
above. From and after such termination of employment of Hillary pursuant to this
Section 14, Hillary's compensation and rights thereto and all of Hillary's other
rights under this agreement shall terminate except as otherwise specifically set
forth in Section 8 above.
15. Notices. Any notice required or permitted to be given under this agreement
shall be sufficient if in writing and if sent by certified mail, return
receipt requested, to Hillary's mailing address set forth above, or by
personal delivery to Hillary, in the case of Hillary, to its office address
set forth above, in the case of the Corporation, with a copy sent in like
manner to such counsel as the Corporation shall designate by written notice
to Hillary. Notices shall be deemed given two (2) business days after
mailing, or on the date personal delivery is effected, as the case may be.
16. Waiver of Breach. The waiver by any party of a breach of any provision of
this agreement by the other party shall not operate or be construed as a
waiver of any subsequent or other breach by the other party. Any waiver must
be in writing.
17. Entire Agreement. This instrument contains the entire agreement of the
parties. It may not be waived, changed, modified or extended orally but only
by an agreement in writing signed by the party against whom enforcement of
any waiver, change, modification or extension is sought.
18. Applicable Law. This agreement shall be governed by and construed and
enforced in accordance with the internal laws of the State of New York
without regard to the application of conflict of laws.
19. Severability. If any provision of this agreement is found to be void or
unenforceable by a court of competent jurisdiction, the remaining provisions
of this agreement shall nevertheless be binding upon the Corporation and
Hillary with the same effect as though the void or unenforceable provision
had been severed and deleted.
20. Conflict. If any provision of this agreement is found to be in conflict
with any provision of any other agreement to which the Corporation and Hillary
are parties, the provision of such other agreement shall control.
9
<PAGE> 10
21. Arbitration. If any dispute shall arise between the Corporation and
Hillary with regard to this agreement, such dispute shall be promptly submitted
to and decided by arbitration by the American Arbitration Association in the
City and County of New York in accordance with the Expedited Procedures of the
Commercial Arbitration Rules of the American Arbitration Association. The award
rendered by the arbitrators shall be final, shall include an award of reasonable
legal fees and costs to the prevailing party as determined by the arbitrator(s)
and judgment may be entered upon the award in accordance with applicable law in
any court having jurisdiction.
22. Prior Managing Director's Agreements. Notwithstanding anything to the
contrary, any prior Managing Director's Agreement between the Corporation and
Hillary (including, without limitation, the Old Agreement) is hereby deemed
terminated and is superseded in all respects by this agreement.
In witness whereof, the parties hereto have caused this agreement to be
duly executed as of the day and year first above written.
Corporation:
Michaelson Kelbick Partners Inc.
By:
-----------------------------
Hillary Kelbick
Managing Director
By:
-----------------------------
Susan Michaelson
Managing Director
--------------------------------
Hillary Kelbick
The provisions of Sections 5(b) and 5(c)
relating to the possible issuance of
Bonus Securities are hereby consented to:
Financial Performance Corporation
By:
----------------------------
William F. Finley, President
10
<PAGE> 1
EXHIBIT 99.1
FINANCIAL PERFORMANCE CORPORATION
Contact Information
- -------------------
William F. Finley
Financial Performance Corporation
335 Madison Avenue, 8th Fl.
New York, New York 10017
(212) 557-0401
FOR IMMEDIATE RELEASE
FINANCIAL PERFORMANCE CORPORATION ANNOUNCES PURCHASE
BY JEFFREY S. SILVERMAN AND RONALD NASH OF STOCK
FROM PRINCIPAL SHAREHOLDER
Silverman and Nash Join Board Of Directors
NEW YORK, NEW YORK, NOVEMBER 18, 1999 - FINANCIAL PERFORMANCE CORPORATION (OTC
BULLETIN BOARD: FPCX) announced today that Messrs. Jeffrey S. Silverman and
Ronald Nash purchased an aggregate of 1,000,000 shares of common stock and
received options to purchase an additional 2,500,000 shares of common stock of
Financial Performance Corporation (the "Company") from Mr. Robert S. Trump, a
principal shareholder of the Company. In addition, the Board of Directors of the
Company appointed Messrs. Silverman and Nash to the Board and granted each of
them five-year options to purchase 1,000,000 shares of common stock of the
Company. After giving effect to the exercise of the options, Mr. Silverman would
become the holder of approximately 27% of the Company's outstanding common
stock. After giving effect to the exercise of the options, Mr. Nash would become
the holder of approximately 27% of the Company's outstanding common stock. As a
result of the transaction, Mr. Trump beneficially owns approximately 48% of the
Company's outstanding common stock.
Jeffrey S. Silverman is the co-founder and Chairman of the investment firm LTS
Capital Partners LLC. From June 1982 to August 1997, Mr. Silverman was Chief
Executive Officer of PLY GEM Industries, Inc., a home improvement building
products supplier, and served as a Director of PLY GEM from 1981 until August
1997, becoming Chairman of the Board in February 1986. During Mr. Silverman's
tenure at PLY GEM, the company acquired 14 companies and annual revenues reached
over $700 million. Mr. Silverman serves on the Boards of Directors of Triarc
Companies Inc. and Boyar Value Fund, Inc.
Ronald Nash is the President and Chief Executive Officer of Network Consulting,
Inc., a financial consulting company. Mr. Nash founded, and from 1982 to 1998
was President of, Nash Weiss & Co., a brokerage firm specializing in market
making for Nasdaq companies, which was sold to Quick & Reilly in 1998. Mr. Nash
is also one of the founding partners and a board member of Steinberg & Lyman
Investment Bankers, where he was responsible for venture capital, strategic
planning, mergers and IPO's within the health care field.
<PAGE> 2
"Jeffrey and Ronald bring many years of experience and expertise in strategic
planning to our company," said William F. Finley, the Company's President, Chief
Executive officer and Principal Financial Officer. "We look forward to having
these two accomplished individuals join our company. We expect them to be
actively involved in assisting us in identifying potential acquisitions
primarily in the financial services industry."
Duncan G. Burke, a Board member of the Company since 1994, resigned as a
Director and Vice President. The Board of Directors of the Company now consists
of Messrs. Silverman, Nash, Finley, Ottavio Serena and Richard S. Levy.
Financial Performance Corporation, through its subsidiary Michaelson Kelbick
Partners, Inc. specializes in financial services marketing and communications.
The Company's customers have included First Union Corporation, Chase Manhattan
Bank, BankBoston, The Dime Savings Bank of New York, Fleet Financial Group, The
CIT Group and PNC Bank.
This news release may include comments that do not refer strictly to historical
results or actions and may be deemed to be forward-looking within the meaning of
the safe harbor provisions of the federal securities laws. Forward-looking
statements are subject to risks and uncertainties that may cause the Company's
results to differ materially from expectations. These risks include the
Company's ability to implement its business strategy and development plans, the
Company's anticipated growth within the financial services industry, the
availability of sufficient financing to expand operations, and the Company's
ability to successfully develop and market its technology, as well as
competitive factors, adverse changes in the financial services industry, and
such other such risks as the Company may identify and discuss from time to time
in its public filings, including those risks disclosed in the Company's
Registration Statement on Form SB-2 dated June 28, 1999. Accordingly, there is
no certainty that the Company's plans will be achieved.
