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Exhibit 99.7
LOCK-UP AGREEMENT
LOCK-UP AGREEMENT (this "AGREEMENT"), dated as of October 29, 2000,
between William Day ("SHAREHOLDER") and PRIMEDIA Inc., a Delaware corporation
("PARENT").
WHEREAS, simultaneously with the execution and delivery hereof, Parent,
Abracadabra Acquisition Corporation, a Delaware corporation and a wholly owned
subsidiary of Parent ("MERGER SUB") and About.com, Inc., a Delaware corporation
have entered into an Agreement and Plan of Merger (the "MERGER AGREEMENT";
capitalized terms used herein and not defined shall have the meanings set forth
in the Merger Agreement), dated as of the date hereof;
WHEREAS, on the Closing Date, pursuant to the Merger Agreement,
Shareholder will be entitled to receive shares of common stock, par value $0.01
per share (the "COMMON STOCK"), of Parent (all such shares, together with any
other shares of capital stock of Parent that Shareholder acquires after the date
hereof as a result of a stock dividend, stock split, recapitalization,
combination, reclassification, exchange, or change of such shares but excluding
any shares of Common Stock received pursuant to any employee benefit plan or
arrangement, the "SHARES");
WHEREAS, as a condition to entering into the Merger Agreement, Parent
and Merger Sub have required that Shareholder agree, and in order to induce
Parent and Merger Sub to enter into the Merger Agreement, Shareholder has agreed
to enter into this Agreement.
NOW, THEREFORE, in consideration of the foregoing and for other good
and valuable consideration, the parties hereby agree as follows:
SECTION 1. TRANSFERS.
(a) PROHIBITION ON TRANSFERS DURING RESTRICTED PERIOD. Except for
Permitted Transfers (as defined below), Shareholder shall not, at any time prior
to the termination of the Restricted Period (as defined below) directly or
indirectly, (i) offer, pledge, sell, contract to sell, sell any option or
contract to purchase, purchase any option or contract to sell, grant any option,
right or warrant to purchase, lend or otherwise transfer or dispose of, directly
or indirectly, any of the Shares or (ii) enter into any swap or other
arrangement that transfers to another, in whole or in part, any of the economic
consequences of ownership of any of the Shares, whether any such transaction
described in clause (i) or (ii) above is to be settled by delivery of Shares, in
cash or otherwise (any such transaction, whether or not for consideration, being
referred to herein as a "TRANSFER"). For purposes of this Agreement, the
"RESTRICTED PERIOD" means the period commencing on the Closing Date and ending
on the third anniversary of the Closing Date.
(b) PERMITTED TRANSFERS. "PERMITTED TRANSFERS" are each of the
following:
(i) during the period commencing on the Closing Date, a number of
Shares (the "GUARANTEED SHARES") not to exceed (x) 8,125,000
DIVIDED BY (y) the per
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share price of $15.25 (the "GUARANTEED PRICE") of the Common
Stock used to calculate the Exchange Ratio;
(ii) on the first anniversary of the Closing Date, a number of
Shares equal to 33 1/3% of [(x) the originally issued
Shares MINUS (y) the number of Guaranteed Shares]; and
(iii) on and after the second anniversary of the Closing Date, 100%
of the Shares; and
(iv) transfers to Permitted Transferees pursuant to Section 4.
(c) STOP TRANSFER ORDER. In furtherance of this Agreement, concurrently
herewith Shareholder shall and hereby does authorize Parent to notify Parent's
transfer agent that there is a stop transfer order with respect to the Shares
subject to the terms of this Agreement (and that this Agreement places limits on
the transfer of the Shares). Shareholder further agrees to cause Parent not to
register the Transfer of any certificate representing any of the Shares unless
such Transfer is made in accordance with the terms of this Agreement.
(d) GUARANTEED PRICE. (i) In the event Shareholder makes a Permitted
Transfer pursuant to Section 1(b)(i) above during the period from the Closing
Date to the first anniversary of the Closing Date in a bona fide, arm's length
transaction at a gross price per share below the Guaranteed Price, and the
average closing price per share of the Common Stock as quoted on the NYSE for
the trading days from the Closing Date to the trading day preceding such sale is
below the Guaranteed Price then, after its receipt of written notice from
Shareholder of such sale, which notice shall include evidence reasonably
satisfactory to Parent of the gross price per Share received by Shareholder in
such sale (the "DISPOSITION PRICE"), Parent shall pay Shareholder, in
immediately available funds, an amount equal to (A) the Guaranteed Price, LESS
(B) the Disposition Price, MULTIPLIED BY (C) the number of Shares disposed of in
such sale.
(ii) Prior to making any Permitted Transfer under Section 1b(i)
above, Shareholder shall offer to sell the Shares to Parent at
a per share price equal to the Guaranteed Price. Parent shall
have 24 hours to accept the Offer.
(E) COPY OF AGREEMENT. A copy of this Agreement shall be filed with the
corporate secretary of Parent and shall be kept with the records of Parent and
shall be made available for inspection by any shareholder of Parent.
(F) EFFECT OF VOID TRANSFERS. In the event of any purported Transfer of
any Shares in violation of the provisions of this Agreement, such purported
Transfer shall be void and of no effect and Parent shall not give effect to such
Transfer. Parent shall not be required to enter in its stock or other records,
or reflect, recognize or give effect to for any purpose, any Transfer of Shares
in violation of this Agreement.
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SECTION 2. REPRESENTATIONS AND WARRANTIES OF SHAREHOLDER. Shareholder
represents and warrants to Parent as follows:
(a) At the Effective Time, Shareholder will be the sole record and
beneficial owner of, and will have, good and valid title to, the Shares, free
and clear of any Liens, except for any Liens arising hereunder. At the Effective
Time, Shareholder will have the power to vote, dispose of and otherwise Transfer
the Shares without the approval, consent or other action of any person.
(b) Shareholder has full power and authority to execute and
deliver this Agreement, to perform his obligations hereunder and to consummate
the transactions contemplated hereby. No action or proceeding is necessary to
authorize the execution and delivery by Shareholder of this Agreement and the
consummation by Shareholder of the transactions contemplated hereby. This
Agreement has been duly executed and delivered by Shareholder, and, assuming
this Agreement constitutes a valid and binding obligation of Parent and Merger
Sub, constitutes a valid and binding obligation of Shareholder, enforceable
against Shareholder in accordance with its terms.
(c) The execution, delivery and performance by Shareholder of this
Agreement and the consummation of the transactions contemplated hereby do not
and will not (i) contravene or conflict with or constitute a violation of any
provision of any law, regulation, judgment, injunction, order or decree binding
upon or applicable to Shareholder or any of his properties; or (ii) conflict
with, or result in the breach or termination of or constitute a default (with or
without the giving of notice or the lapse of time or both) under, or give rise
to any right of termination, cancellation, or loss of any benefit to which
Shareholder is entitled under any provision of any agreement, contract, license
or other instrument binding upon Shareholder or any of his properties, or allow
the acceleration of the performance of any obligation of Shareholder under any
indenture, mortgage deed of trust, lease, license, contract, instrument or other
agreement to which Shareholder is a party or by which Shareholder, his assets or
properties is subject or bound, other than such contraventions, conflicts,
violations, breaches, defaults or other occurrences that would not reasonably be
expected to prevent, delay or impair Shareholder's ability to consummate the
transactions contemplated by this Agreement.
(d) The execution, delivery and performance by Shareholder of this
Agreement and the consummation of the transactions contemplated hereby by
Shareholder require no filings, notices, declarations, consents or other actions
to be made by Shareholder with, nor are any approvals or other confirmations or
consents required to be obtained by Shareholder from, any governmental
authority.
(e) Shareholder understands and acknowledges that Parent and
Merger Sub are entering into the Merger Agreement in reliance on Shareholder's
execution and delivery of this Agreement.
SECTION 3. COMPLIANCE WITH SECURITIES LAWS. Shareholder shall not at
any time during or following the Restricted Period make any Transfer, except (a)
Transfers pursuant to an effective registration statement under the Securities
Act, (b) Transfers in conformity with the requirements of Rules 144 and 145
under the Securities Act or (c) if Shareholder shall have furnished Parent with
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an opinion of counsel, which opinion of counsel shall be reasonably satisfactory
to Parent, to the effect that the Transfer is otherwise exempt from registration
under the Securities Act and that the Transfer otherwise complies with the terms
of this Agreement.
SECTION 4. PERMITTED TRANSFEREES.
(a) PERMITTED TRANSFEREES. Shareholder shall be entitled, from time to
time prior to the end of the Restricted Period, to Transfer any or all of the
Shares owned by him to his parent, spouse, sibling, child, grandchild, niece or
nephew of Shareholder or any trust or family limited partnership for the benefit
of such person or persons; PROVIDED that any such transferee shall agree in
writing in form and substance reasonably satisfactory to Parent to become a
party to, and be bound to the same extent as its transferor by the terms of,
this Agreement, and any such transferee shall be deemed to be a "Shareholder"
hereunder (any such transferee, a "PERMITTED TRANSFEREE").
SECTION 5. LEGENDS. Each certificate representing any Shares issued
(whether prior to, on or after the date hereof) to Shareholder shall bear the
following legend on the face thereof:
"THE SECURITIES REPRESENTED HEREBY ARE SUBJECT TO A LOCK-UP
AGREEMENT AMONG THE HOLDER HEREOF AND PRIMEDIA INC., A COPY OF
WHICH IS ON FILE WITH THE SECRETARY OF THE ISSUER. NO
TRANSFER, SALE, ASSIGNMENT, EXCHANGE, HYPOTHECATION OR OTHER
DISPOSITION OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE
MAY BE MADE EXCEPT IN ACCORDANCE WITH THE PROVISIONS OF SUCH
AGREEMENT."
SECTION 6. GOVERNING LAW. This Agreement shall be governed by the laws
of the State of New York.
SECTION 7. NOTICES. Notices and other communications under this
Agreement shall be in writing and shall be deemed given as set forth in Section
8.2 of the Merger Agreement, except that Shareholder shall receive such notices
at the address set forth below Shareholder's name on the signature page hereof.
SECTION 8. ENTIRE AGREEMENT; AMENDMENTS. This Agreement constitutes the
entire understanding of the parties with respect to the subject matter hereof.
There are no restrictions, agreements, promises, warranties, covenants or
undertakings with respect to the subject matter hereof other than those
expressly set forth herein. This Agreement supersedes all prior agreements and
understandings between the parties with respect to its subject matter and is not
intended to confer upon any person other than the parties hereto any rights or
remedies hereunder. This Agreement may be amended only by a written instrument
duly executed by Parent and Shareholder.
SECTION 9. ASSIGNMENT. Notwithstanding any other provision of this
Agreement, this Agreement shall not be assignable by any party hereto, except by
operation of law. Subject to the preceding sentence, this Agreement will be
binding upon, inure to the benefit of and be enforceable against, (i) as to
Shareholder, Shareholder and Shareholder's beneficiaries and representatives,
and (ii) Parent and its successors and permitted assigns. Shareholder agrees
that this Agreement and the obligations of Shareholder hereunder shall attach to
Shareholder's Shares and shall be binding upon any person or entity to which
legal or beneficial ownership of such Shares shall pass, whether by
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operation of law or otherwise, including Shareholder's heirs, guardians,
administrators or successors.
SECTION 10. SEVERABILITY. The provisions of this Agreement shall be
deemed severable and the invalidity or unenforceability of any provision shall
not affect the validity and enforceability of the other provisions hereof. If
any provision of this Agreement, or the application thereof to any person or
entity or any circumstance, is invalid or unenforceable, (a) a suitable and
equitable provision shall be substituted therefor in order to carry out, so far
as may be valid and unenforceable, the intent and purpose of such invalid and
unenforceable provision and (b) the remainder of this Agreement and the
application of such provision to other persons, entities or circumstances shall
not be affected by such invalidity or unenforceability, nor shall such
invalidity and unenforceability affect the validity or enforceability of such
provision, or the application thereof, in any other jurisdiction.
SECTION 11. FURTHER ACTION. From time to time, at the request of Parent
and without further consideration, Shareholder shall execute and deliver to
Parent such documents and take such action as Parent may reasonably request in
order to consummate the transactions contemplated hereby.
SECTION 12. COUNTERPARTS. This Agreement may be executed in one or more
counterparts, all of which shall be considered one and the same agreement, and
shall become effective when one or more of the counterparts have been signed by
each of the parties and delivered to the other parties, it being understood that
all parties need not sign the same counterpart.
SECTION 13. SPECIFIC PERFORMANCE. Shareholder and Parent acknowledge
that this Agreement and the Shares are unique and that no party will have an
adequate remedy at law if any other party breaches any covenant herein or fails
to perform its obligations hereunder. Accordingly, Shareholder and Parent agree
that the others shall have the right, in addition to any other rights that it
may have, to specific performance and equitable injunctive relief if any party
shall fail or threaten to fail to perform any of its obligations under this
Agreement.
SECTION 14. EXPENSES. All costs and expenses incurred in connection
with this Agreement and the transactions contemplated hereby shall be paid by
the party incurring such cost or expense.
SECTION 15. SHAREHOLDER CAPACITY. Shareholder signs solely in his
capacity as the record holder and beneficial owner of the Shares and nothing
herein shall limit or affect any actions taken or to be taken by any officer,
director or financial advisor of the Company or its subsidiaries in
Shareholder's capacity as an officer, director or financial advisor of the
Company or its subsidiaries.
SECTION 16. NO WAIVER. No failure or delay by Parent to assert any of
its rights under this Agreement or otherwise shall constitute a waiver of such
rights. No single or partial exercise of any right, remedy, power or privilege
hereunder shall preclude any other or further exercise thereof or the exercise
of any other right, remedy, power or privilege. Any waiver shall be effective
only in the specific instance and for the specific purpose for which given and
shall not
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constitute a waiver to any subsequent or other exercise of any right, remedy,
power or privilege hereunder.
SECTION 17. SUBMISSION TO JURISDICTION. Each of the parties hereto
irrevocably agrees that any legal action or proceeding with respect to this
Agreement or for recognition and enforcement of any judgment in respect hereof
brought by any other party hereto or its successors or assigns may be brought
and determined in the courts of the State of New York, and each party hereto
hereby irrevocably submits with regard to any such action or proceeding for
itself and with respect to its property, generally and unconditionally, to the
nonexclusive jurisdiction of the aforesaid courts. Each of the parties hereto
hereby irrevocably waives, and agrees not to assert, by way of motion, as a
defense, counterclaim or otherwise, in any action or proceeding with respect to
this Agreement, (a) any claim that it is not personally subject to the
jurisdiction of the above-named courts for any reason other than the failure to
lawfully serve process, (b) that it or its property is exempt or immune from
jurisdiction of any such court or from any legal process commenced in such
courts (whether through service of notice, attachment prior to judgment,
attachment in aid of execution of judgment, execution of judgment or otherwise),
and (c) to the fullest extent permitted by applicable law, that (i) the suit,
action or proceeding in any such court is brought in an inconvenient forum, (ii)
the venue of such suit, action or proceeding is improper and (iii) this
Agreement, or the subject matter hereof, may not be enforced in or by such
courts.
SECTION 18. WAIVER OF JURY TRIAL. Each party hereto hereby irrevocably
and unconditionally waives any rights to a trial by jury in any legal action or
proceeding in relation to this Agreement and for any counterclaim therein.
SECTION 19. INTERPRETATION. The parties hereto agree that in
interpreting this Agreement there shall be no inferences against the drafting
party.
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IN WITNESS WHEREOF, each of the parties hereto has caused this
Agreement to be executed on its behalf by its representatives thereunto duly
authorized, all as of the day and year first above written.
PRIMEDIA INC.
By: /s/ Beverly C. Chell
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Name: Beverly C. Chell
Title: Vice Chairman
_______________________________
By: /s/ William C. Day
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Name: William C. Day
Address: 266 Maple Street,
Hawthorn, NJ 07641
Shares Beneficially Held: 72,780
Options Held:
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