<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
[X] Quarterly Report Pursuant to Section 13 or
15(d) of the Securities Exchange Act of 1934.
For the quarterly period ended March 31, 1997
or
[ ] Transition Report Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934.
For the transition period _____ to ______
Commission File Number 1-12577
SITEL CORPORATION
(Exact name of registrant as specified in its charter)
MINNESOTA 47-0684333
(State or jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
13215 BIRCH STREET
OMAHA, NEBRASKA 68164
(402) 963-6810
(Address, including zip code, and telephone number, including area code, of
registrant's principal executive offices)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports) and (2) has been subject to such
filing requirements for the past 90 days. YES X NO
___ ___
As of May 8, 1997, the Company had 61,820,085 shares of Common Stock
outstanding.
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SITEL CORPORATION AND SUBSIDIARIES
PART I - FINANCIAL INFORMATION
_______________________________
Item 1. Financial Statements:
Consolidated Condensed Balance Sheets.................... 1
Consolidated Condensed Statements of Income.............. 2
Consolidated Condensed Statements of Cash Flows.......... 3
Notes to Consolidated Condensed Financial Statements..... 4
Item 2. Management's Discussion and Analysis of Results of Operations
and Financial Condition.................................... 6
PART II - OTHER INFORMATION
___________________________
Item 2. Changes in Securities.......................................... 9
Item 6. Exhibits and Reports on Form 8-K............................... 9
Signature............................................................... 10
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<TABLE>
SITEL CORPORATION AND SUBSIDIARIES
CONSOLIDATED CONDENSED BALANCE SHEETS
December 31, 1996 and March 31, 1997
(dollars in thousands, except share data)
ASSETS December 31, March 31,
1996 1997
____________ ___________
Current assets: (UNAUDITED)
<S> <C> <C>
Cash and cash equivalents ................................. $ 25,710 $ 8,147
Trade accounts receivable (net of allowance for doubtful
accounts of $ 3,188and $ 3,645, respectively)............ 65,477 86,570
Marketable securities ..................................... 1,740 1,525
Prepaid expenses .......................................... 3,007 4,231
Other assets .............................................. 2,907 4,704
Deferred income taxes ..................................... 512 521
_________ _________
Total current assets ....................... 99,353 105,698
Property and equipment, net .................................... 59,109 77,811
Deferred income taxes .......................................... 11,187 11,385
Goodwill, net................................................... 40,110 73,504
Other assets.................................................... 1,925 2,491
_________ _________
Total assets ............................... $ 211,684 $ 270,889
========= =========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Note payable - bank........................................ $ 3,638 $ 23,751
Current portion of long-term debt.......................... 759 1,063
Current portion of capitalized lease obligations.......... 3,032 3,250
Trade accounts payable..................................... 18,775 20,011
Income taxes payable....................................... 3,815 4,393
Accrued compensation....................................... 14,812 12,723
Accrued operating expenses................................. 9,026 11,975
Deferred revenue................................ .......... 7,632 5,183
Customer deposits and other................................ 1,028 92
_________ _________
Total current liabilities................... 62,517 82,441
_________ _________
Long-term debt, excluding current portion....................... 1,720 15,883
Capitalized lease obligations, excluding current portion........ 3,141 4,245
Purchase price payable.......................................... 15,928 14,561
Deferred compensation .......................................... 1,461 1,568
Minority interest............................................... 192 203
Stockholders' equity:
Common stock, voting, $.001 par value, 200,000,000 shares
authorized,58,875,660 and 60,894,746 shares issued and
outstanding, respectively................................ 59 61
Paid-in capital............................................ 117,736 141,291
Currency exchange adjustment............................... 1,311 (3,294)
Unrealized gain on marketable securities................... 1,017 874
Retained earnings.......................................... 6,602 13,056
________ _________
Total stockholders' equity.................. 126,725 151,988
________ _________
Total liabilities and stockholders' equity.. $ 211,684 $ 270,889
======== =========
The accompanying notes are an integral part of the consolidated condensed
financial statements.
</TABLE>
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SITEL CORPORATION AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF INCOME
(unaudited)
For The Three Months Ended
March 31, 1996 March 31, 1997
______________ ______________
(in thousands, except per share data)
Revenues..................................... $ 59,519 $ 104,260
______________ ______________
Operating expenses:
Cost of services........................ 31,593 56,357
Selling, general and administrative
expenses................................. 22,010 37,242
______________ ______________
Total operating expense.. 53,603 93,599
Operating income......... 5,916 10,661
Other income (expense):
Interest income (expense), net.......... 101 (534)
_____________ ______________
Income before income taxes and minority interest 6,017 10,127
Income tax expense........................... 2,211 3,643
Minority interest ........................... -- 30
_____________ ______________
Net income .................................. $ 3,806 $ 6,454
============= ==============
Per share amounts:
Earnings per common and common
equivalents share.................. $ 0.06 $ 0.10
============= ==============
Weighted average common and common
equivalent shares outstanding........... 64,262 67,649
============= ==============
The accompanying notes are an integral part of the consolidated condensed
financial statements.
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SITEL CORPORATION AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
(unaudited)
For Three Months Ended
(dollars in thousands) March 31, March 31,
1996 1997
_________ _________
Net cash used by operating activities (including
effect of depreciation and amortization of
$1,479 and $4,881, respectively).............. $ (3,634) $ (13,005)
_________ _________
Cash flows from investing activities:
Purchases of property and equipment........ (7,312) (18,692)
Acquisition of businesses, net of cash
acquired................................... (4,216) (20,666)
Investments in marketable securities....... (34,203) --
Sale of marketable securities.............. 3,000 --
Advances on loans receivable from related
parties.................................... (78) --
Changes in other assets.................... (30) 108
_________ __________
Net cash used in investing activities. (42,839) (39,250)
_________ __________
Cash flows from financing activities:
Borrowings on note payable................. 9,390 28,862
Repayments of note payable................. (5,138) (9,291)
Borrowings on long-term debt and
capitalized lease obligations.............. -- 14,574
Repayment of long-term debt and capitalized
lease obligations.......................... (458) (27)
State incentive credits received........... -- 900
Common stock issued for option exercises and
in public offering, net of expenses...... 42,241 200
__________ __________
Net cash provided by financing
activities.......................... 46,035 35,218
__________ __________
Effect of exchange rates on cash................ 9 (526)
__________ __________
Net decrease in cash.................. (429) (17,563)
Cash and cash equivalents, beginning of period.. 4,531 25,710
__________ ___________
Cash and cash equivalents, end of period........ $ 4,102 $ 8,147
========== ===========
Supplemental schedule of non-cash financing and investing activities:
_____________________________________________________________________
In the first quarter of 1997, the Company issued approximately 1,298,000 shares
of the Company's common stock
in connection with acquisitions.
The accompanying notes are an integral part of the consolidated condensed
financial statements.
<PAGE>
SITEL CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATMENTS
1. BASIS OF PRESENTATION:
The consolidated condensed balance sheet of SITEL Corporation and Subsidiaries
(the "Company") at December 31, 1996 was obtained from the Company's audited
balance sheet as of that date. All other financial statements contained herein
are unaudited and, in the opinion of management, contain all adjustments
necessary for a fair presentation of the financial position, operating results,
and cash flows for the periods presented. Such adjustments consist only of
normal recurring items. The consolidated condensed financial statements should
be read in conjunction with the consolidated financial statements and notes
thereto, together with management's discussion and analysis of financial
condition and results of operations, contained in the Company's Form 10-K for
the year ended December 31, 1996.
2. EARNINGS PER SHARE:
Earnings per share attributable to common shareholders has been computed using
the weighted average number of common and common equivalent shares outstanding:
Three Months Ended
3/31/96 3/31/97
_______ _______
(in thousands)
Common stock 55,446 59,764
Common stock equivalents-
stock options 8,816 7,885
_______ _______
64,262 67,649
======= =======
In February 1997, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards No. 128, "Earnings Per Share" ("SFAS 128"). SFAS
128 revises the calculation and presentation provisions of Accounting Principles
Board Opinion No. 15 ("APB 15") and related interpretations. SFAS 128, which
will require retroactive application, is effective for the Company's year ended
December 31, 1997. While the Company has not determined the full effect of
adopting SFAS 128, it believes that the adoption will not have a significant
effect on its reported earnings per share, except that the presentation of basic
earnings per share, calculated in accordance with SFAS 128, will be greater than
the previously reported "Earnings per common and common equivalent share,"
calculated in accordance with APB 15 and related interpretations. The Company
also believes that diluted earnings per share, calculated in accordance with
SFAS 128, will be similar to the previously reported "Earnings per common and
common equivalent share," calculated in accordance with APB 15 and related
interpretations.
3. ACQUISITIONS:
In January 1997, the Company acquired all of the outstanding capital stock of
Telebusiness Holdings, a systems integration company based in Australia and New
Zealand. In February 1997, the Company acquired substantially all of the assets
of Exton Technology Group, a teleservicing technical support company based in
Madison, Wisconsin. In March 1997, the Company acquired all of the outstanding
stock of Levita Group Pty Ltd., an Australian based teleservicing company, and
all of the outstanding stock of L&R Group Limited, a United Kingdom
based teleservicing consulting firm.
<PAGE>
SITEL CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATMENTS
3. ACQUISITIONS (continued):
The total cost of these acquisitions was approximately $40 million, subject to
certain adjustments and excluding transaction costs and liabilities assumed.
Included in the total cost was the issuance of approximately 1.3 million shares
of the Company's common stock valued at approximately $19 million.
These acquisitions have been accounted for as purchases and accordingly, the
acquired assets and liabilities have been recorded at their estimated fair
values at the dates of acquisition, and the results of operations have been
included in the accompanying consolidated condensed financial statements since
the dates of acquisition. The initial purchase price allocations for the
acquisitions are based on current estimates and the Company will make the final
purchase price allocations based upon final values for certain assets and
liabilities. The total purchase price in excess of the fair market value of the
net assets acquired was recorded as goodwill and is being amortized over 25
years.
The following pro forma information shows the results of the Company as though
the acquisitions described earlier occurred as of the beginning of each period
presented. These results include certain adjustments consistent with the
Company's policy related to amortization of intangible assets. These results
are not necessarily indicative of the results that actually would have been
obtained if the acquisitions had been in effect at the beginning of each period
or which may be attained in the future.
Three Months Ended
3/31/96 3/31/97
_______ _______
Revenue $66,714 $108,474
Net Income $ 3,983 $ 5,780
Earnings Per Common and
and Common Equivalents Share $0.06 $0.08
4. INCOME TAXES:
The difference between the Company's income tax expense as reported in the
accompanying financial statements and that which would be calculated using the
statutory Federal income tax rate of 34% on income is primarily due to
non-deductible business acquisition expenses and state income taxes.
5. LONG TERM DEBT AND NOTES PAYABLE:
In connection with an acquisition during the first quarter of 1997, the Company
borrowed $14.3 million from a financial institution. The note, which is due in
February 1999, requires quarterly interest payments at a variable rate (7.75% at
March 31, 1997). The note is collateralized by accounts receivable, equipment
and other assets, and contains financial covenants including, among others,
minimum levels of working capital, net worth and tangible net worth.
In addition, during the first quarter of 1997, the Company increased the maximum
borrowings under its domestic revolving credit agreements to $29 million. At
March 31, 1997, the total amount outstanding under all of its credit agreements,
including several international lines of credit, was approximately $23.8
million.
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SITEL CORPORATION AND SUBSIDIARIES
Item 2. Management's Discussion and Analysis of Results of Operation and
________________________________________________________________
Financial Condition.
____________________
Overview
_________
SITEL Corporation and subsidiaries (the "Company") are engaged in inbound,
outbound, and interactive teleservicing activities, servicing the insurance,
financial services, telecommunication, media and entertainment, technology,
utilities, consumer, automotive, and travel industries. Operations are
primarily located in North America and Europe.
The following table sets forth certain financial data and the percentage of
total revenues of the Company for the periods indicated. All amounts are in
thousands.
Three Months Ended March 31,
1996 1997
_____________ ________________
Revenues....................... $ 59,519 100.0% $ 104,260 100.0%
_____________ ________________
Operating expenses:
Cost of services............. 31,593 53.1% 56,357 54.1%
Selling, general, and
administrative expenses..... 22,010 37.0% 37,242 35.7%
_____________ ________________
Total operating expenses... 53,603 90.1% 93,599 89.8%
_____________ ________________
Operating income........... 5,916 9.9% 10,661 10.2%
Interest income (expense),
net....................... 101 0.2% (534) (0.5)%
_____________ ________________
Income before income taxes
and minority interest..... 6,017 10.1% 10,127 9.7%
Income tax expense........ 2,211 3.7% 3,643 3.5%
Minority interest......... -- -- 30 0.0%
_____________ ________________
Net income................ $ 3,806 6.4% $ 6,454 6.2%
============= ================
Three Months Ended March 31, 1997 vs. Three Months Ended March 31, 1996
_______________________________________________________________________
REVENUES:
_________
Revenues increased $44.7 million, or 75%, to $104.3 million in the three months
ended March 31, 1997 from $59.5 million in the three months ended March 31,
1996. Of this increase, $15.0 million was attributable to services initiated
for new clients, $16.3 million was attributable to increased revenues from
existing clients and $13.5 million was attributable to revenues from businesses
acquired since March 31, 1996 under the purchase method of accounting, primarily
in Spain. The increase in revenues from existing clients was primarily the
result of higher calling volumes rather than higher rates.
<PAGE>
SITEL CORPORATION AND SUBSIDIARIES
COST OF SERVICES:
_________________
Cost of services increased $24.8 million, or 78%, to $56.4 million in the three
months ended March 31, 1997 from $31.6 million in the three months ended March
31, 1996. As a percentage of revenues, cost of services increased to 54.1% in
the first quarter of 1997 from 53.1% in the first quarter of 1996. This
increase was primarily attributable to the Company's Spanish operations which
implemented a new compensation plan in 1997. This plan also has the
corresponding effect of decreasing selling, general and administrative expenses
in Spain. Cost of services represents labor and telephone expenses directly
related to teleservicing activities.
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES:
_____________________________________________
Selling, general and administrative expenses increased $15.2 million, or 69%, to
$37.2 million in the three months ended March 31, 1997 from $22.0 million in the
three months ended March 31, 1996. This increase was primarily a result of the
Company's continued growth both internally and through acquisition. As a
percentage of revenues, selling, general and administrative expenses decreased
to 35.7% in the first quarter of 1997 from 37.0% in the first quarter of 1996.
This decrease was primarily attributable to increased revenues without a
commensurate increase in expenses and lower compensation expenses related to
discretionary performance bonuses. These factors were partially offset by start
up costs in the Company's new industry efforts in North America and the
expansion to the Asia Pacific region. Selling, general and administrative
expenses represent expenses incurred to directly support and manage the
operations including costs of management, administration, facilities expenses,
depreciation and maintenance, amortization, sales and marketing activities, and
client support services.
OPERATING INCOME:
_________________
Operating income increased $4.7 million, or 80%, to $10.7 million in the three
months ended March 31, 1997 from $5.9 million in the three months ended March
31, 1996. The increase is primarily attributable to the increase in revenues
noted earlier, partially offset by the increased expenses attributable to those
revenues. As a percentage of revenues, operating income increased to 10.2% in
the first quarter of 1997 from 9.9% in the first quarter of 1996. This increase
was primarily the result of the decrease in selling, general and administrative
expenses as a percentage of revenue in the first quarter of 1997.
INTEREST INCOME (EXPENSE), NET:
_______________________________
Interest income (expense), net, decreased to $(0.5) of interest expense in the
three months ended March 31, 1997 from $0.1 million of interest income in the
three months ended March 31, 1996. This decrease is primarily due to increased
borrowings utilized to support the Company's growth, including acquisitions.
INCOME TAX EXPENSE:
___________________
Income tax expense increased to $3.6 million in the three months ended March 31,
1997 from $2.2 million in the three months ended March 31, 1996. This increase
is primarily attributable to the increase in operating income noted earlier.
<PAGE>
SITEL CORPORATION AND SUBSIDIARIES
NET INCOME:
___________
Net income increased $2.6 million, or 70%, to $6.5 million in the three months
ended March 31, 1997 from $3.8 million in the three months ended March 31, 1996.
The increase is primarily due to the increase in revenues in the first quarter
of 1997 compared to the first quarter of 1996, offset by increased operating
expenses, interest expense and income tax expense.
LIQUIDITY AND CAPITAL RESOURCES:
________________________________
Cash used by operating activities was approximately $13.0 million during the
first quarter of 1997. This use of cash was primarily the result of an increase
in accounts receivable partially offset by net income and increases in other
liabilities. Cash used by investing activities in the first quarter of 1997 of
approximately $39.3 million was primarily related to capital expenditures and
acquisitions of businesses. Cash provided by financing activities for the
first quarter of 1997 of approximately $35.2 million primarily related to
borrowings on the Company's available lines of credit and a $14.3 million note
payable related to an acquisition. The Company believes that funds generated
from operations, existing cash, and existing lines of credit will be sufficient
to finance its current operations, planned capital expenditure requirements and
internal growth. Future acquisitions, if any, may require additional debt or
equity financing.
QUARTERLY RESULTS AND SEASONALITY:
__________________________________
The Company has experienced and expects to continue to experience quarterly
variations in its results of operations principally due to the timing of
clients' teleservicing campaigns and the commencement of new contracts, revenue
mix, and the timing of additional selling, general and administrative expenses
to support new business. While the effects of seasonality on the Company's
business often are offset by the addition of new clients or new programs for
existing clients, the Company's business tends to be slower in August and
December. August is affected by reduced teleservicing activities in Europe and
December is affected by reduced teleservicing activities during
the holiday season.
EFFECTS OF INFLATION:
_____________________
Inflation has not had a significant effect on the Company's operations. However,
there can be no assurance that inflation will not have a material effect on the
Company's operations in the future.
FORWARD-LOOKING STATEMENTS:
___________________________
From time to time, in written reports and oral statements, the Company discusses
its expectations regarding future performance. These "forward-looking
statements" are based on currently available competitive, financial and economic
data and the Company's operating plans. These statements are also inherently
subject to risks and uncertainties, including without limitation the risks
described in the Company's periodic reports and other filings with the
Securities and Exchange Commission. Because of the risks and uncertainties,
events and results could turn out to be significantly different from what the
Company had expected.
<PAGE>
SITEL CORPORATION AND SUBSIDIARIES
PART II - OTHER INFORMATION
Item 2. Changes in Securities.
(c)Sales of Equity Securities Under Exemptions Other Than Regulation S.
On March 4, 1997, in connection with the acquisition of all of the
outstanding shares of Levita Group Pty Limited ("Levita"), a New South Wales
corporation, by an affiliated company of the registrant, the registrant issued
683,687 shares of its Common Stock to the owners of Levita in satisfaction of
A$17,380,000 (Australian dollars) of the acquisition price. The issued shares
were sold outside the United States in reliance on multiple exemptions from
registration, including without limitation Section 4(2) of the Securities Act
of 1933.
On March 18, 1997, in connection with the acquisition of all of
the outstanding shares of the L & R Group Limited ("L&R"), a United
Kingdom corporation, by an affiliated company of the registrant, the registrant
issued 78,510 shares of its Common Stock to the owners of L&R in
satisfaction of UK$863,671 (pounds) of the acquisition price. The issued
shares were sold outside the United States in reliance on multiple exemptions
from registration, including without limitation Section 4(2) of the Securities
Act of 1933.
Item 6. Exhibits and Reports on Form 8-K.
(a) Exhibits:
2.3(c) Amendment to Agreement and Plan of Reorganization,
Registration Rights Agreement, and Escrow Agreement (NAFS)
2.4(f) Amendment No. 3 to Share Purchase Agreement (Mitre)
2.4(g) Amendment No. 1 to Escrow Agreement (Mitre)
2.4(h) Amendment No. 1 to Registration Rights Agreement (Mitre)
27 Financial Data Schedule
(b) Reports on Form 8-K. The Company filed the following reports on Form 8-K
during the quarter for which this report is filed.
1) The Company filed a Form 8-K on January 31, 1997 reporting, under
Item 5, certain officer appointments and, under Item 9, the issuance
of shares in connection with the acquisition of B's Telemarketing
Limited.
2) The Company filed a Form 8-K on February 6, 1997 reporting, under
Item 4, a change in the Company's certifying accountant and, under
Item 8, a change in fiscal year.
3) The Company filed a Form 8-K on February 12, 1997 reporting,
under Item 9, the issuance of shares in connection with the
acquisition of Telebusiness New Zealand Limited.
<PAGE>
SIGNATURES
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, thereunto duly authorized.
Date: May 13, 1997 SITEL Corporation
By: /s/ Michael P. May
_______________________
Michael P. May
Chief Executive Officer
By: /s/ Barry S. Major
_______________________
Barry S. Major
Executive Vice-President and Chief Financial
Officer
(Principal Financial Officer)
<PAGE>
SITEL CORPORATION AND SUBSIDIARIES
Exhibits Index:
2.3(c) Amendment to Agreement and Plan of Reorganization,
Registration Rights Agreement, and Escrow Agreement
(NAFS)
2.4(f) Amendment No. 3 to Share Purchase Agreement (Mitre)
2.4(g) Amendment No. 1 to Escrow Agreement (Mitre)
2.4(h) Amendment No. 1 to Registration Rights Agreement (Mitre)
27 Financial Data Schedule
EXHIBIT 2.3(C)
AMENDMENT TO
AGREEMENT AND PLAN OF REORGANIZATION,
REGISTRATION RIGHTS AGREEMENT,
AND ESCROW AGREEMENT
THIS AMENDMENT is made this April 4, 1997, but effective as of June 28,
1996, by and among NATIONAL ACTION FINANCIAL SERVICES, INC., a Georgia
corporation, for itself and as successor to SC ACQUISITION CORP., a Nebraska
corporation, ("NAFS"), SITEL CORPORATION, a Minnesota corporation ("SITEL"),
MICHAEL W. FLETCHER individually and also in his capacity as Stockholders'
Representative ("Stockholders Representative"), and (with respect to the Escrow
Agreement only) FIRST BANK, N.A., as Escrow Agent.
This Amendment amends the Agreement and Plan of Reorganization dated June
6, 1996, as amended (the "Merger Agreement"), the Registration Rights Agreement
dated June 28, 1996 (the "Registration Rights Agreement"), and the Escrow
Agreement dated July 3, 1996 (the "Escrow Agreement") by and among the above
parties. The Merger Agreement, Registration Rights Agreement, and Escrow
Agreement are referred to collectively as the "Agreements".
WE AGREE AS FOLLOWS:
MERGER AGREEMENT
________________
1. The following definition of "Audit Completion Date" is added in
alphabetical order to Article I of the Merger Agreement:
"Audit Completion Date" means the date of issuance of the first report
of independent auditors on the financial statements of the combined
enterprise of SITEL and NAFS following the Closing Date.
2. The definition of "Escrow Period" in Article I of the Merger
Agreement is amended to state in its entirety as follows:
"Escrow Period" means the period beginning on the Closing Date
and ending on the earlier of the Audit Completion Date or the one
year anniversary of the Closing Date.
3. The definition of "Survival Period" in Article I of the Merger
Agreement is amended to state in its entirety as follows:
"Survival Period" means the period beginning on the Closing Date and
ending on the earlier of the Audit Completion Date or the one year
anniversary of the Closing Date.
<PAGE>
4. Section 4.6 of the Merger Agreement is amended to state in its
entirety as follows:
4.6 Escrow Agreement. At the Closing, SITEL, Stockholders'
Representative, and an escrow agent to be mutually agreed upon by the
parties prior to Closing (the "Escrow Agent") shall execute and deliver an
Escrow Agreement in mutually satisfactory form (the "Escrow Agreement").
Pursuant to the Escrow Agreement, at the Closing SITEL shall deliver the
Indemnity Escrow Shares to the Escrow Agent. The Indemnity Escrow Shares
shall secure the NAFS Stockholders' indemnification obligations to SITEL
and its affiliates for the NAFS Stockholders' representations, warranties
and covenants under or pursuant to this Agreement for the Escrow
Period. As will be provided in the Escrow Agreement, during the Escrow
Period, the NAFS Stockholders shall be entitled to vote the Indemnity
Escrow Shares and to receive any dividends paid on the Indemnity Escrow
Shares. As will be provided in the Escrow Agreement, to the extent
Indemnity Escrow Shares are applied to indemnification obligations of the
NAFS Shareholders, any dividends paid to NAFS Shareholders in respect of
the applied Indemnity Escrow Shares shall be returned to SITEL promptly
following application of the Indemnity Escrow Shares. As will be provided
in the Escrow Agreement, to the extent not applied to any indemnification
obligations of the NAFS Stockholders during the Escrow Period, the
Indemnity Escrow Shares shall be immediately released to the NAFS
Stockholders following the Escrow Period.
5. Section 6.8 of the Merger Agreement is amended to state in its
entirety as follows:
6.8 Accounts Receivable. The accounts receivable of NAFS arising from
the Business as set forth on the Interim Balance Sheet or arising since the
date thereof are valid and genuine; have arisen solely out of bona fide
sales and deliveries of goods, performance of services and other business
transactions in the ordinary course of business consistent with past
practice; and are not subject to valid defenses, set-offs or counterclaims.
The allowance for collection losses on the Interim Balance Sheet has been
determined in accordance with GAAP consistent with past practice.
<PAGE>
6. Section 10.3 of the Merger Agreement is amended to state in its
entirety as follows:
10.3 Method of Asserting Claims; Limitations on Indemnification.
___________________________________________________________
10.3.1 Claim Notice.
_____________
(a) In the event that (1) any SITEL Claim is asserted against or
sought to be collected from an Indemnified SITEL Party by a third party, or
(2) an Indemnified SITEL Party has a SITEL Claim against NAFS Stockholders
which does not involve a claim or demand being asserted against or sought
to be collected from it by a third party, the Indemnified SITEL Party shall
promptly notify the Stockholders' Representative of such SITEL Claim,
specifying the nature of such SITEL Claim and the amount or the estimated
amount thereof to the extent then feasible (which estimate shall not be
conclusive of the final amount of such SITEL Claim) (the "Claim Notice").
The Stockholders' Representative shall have thirty (30) days from the
personal delivery or mailing of the Claim Notice (the "Notice Period") to
notify the Indemnified SITEL Party, (i) whether or not they dispute their
liability to the Indemnified SITEL Party hereunder with respect to such
SITEL Claim and (ii) in the case of a SITEL Claim involving a third party,
notwithstanding any such dispute, whether or not they desire, at their sole
cost and expense, to defend the Indemnified SITEL Party against such SITEL
Claim.
(b)(1) A Claim Notice for a SITEL Claim must be given to NAFS and
Stockholders' Representative within the Survival Period. The NAFS
Stockholders shall not have any indemnification obligations under this
Article X with respect to SITEL Claims for which a Claim Notice is not
given to them within the Survival Period.
(c) The NAFS Stockholders shall be obligated to indemnify the SITEL
Indemnified Parties with respect to SITEL Claims only to the extent of the
excess of such SITEL Claims (which either have been paid to third parties
or, if the claim originates with SITEL or NAFS, then which have been
presented and for which the NAFS Stockholders would have liability in
accordance with this Section 10.3 (without regard to this Section 10.3
(c) over $200,000 in the aggregate; provided, however, that this claims
"basket" shall not apply to the NAFS Stockholders' obligation to indemnify
the SITEL Indemnified Parties with respect to any misrepresentation in or
omission from the certificate with respect to the Net Book Value.
(d) The NAFS Stockholders' obligations for indemnification under this
Article X, and obligations underlying the other rights and remedies
referred to in Section 10.7, shall not exceed an amount equal to thirty
percent (30%) of the SITEL Common Shares comprising the Adjusted Merger
Consideration or, to the extent that the NAFS Stockholders no longer hold
such shares at the time of indemnification, the cash equivalent of such
shares based upon the Exchange Price (the "Aggregate Indemnification
Limit"). An individual NAFS Stockholder's obligations for indemnification
under this Article X shall not exceed such NAFS Stockholder's pro rata
share of the Aggregate Indemnification Limit, based upon such NAFS
Stockholder's percentage share of the NAFS Common Shares outstanding (on an
as converted and fully diluted basis) immediately prior to the Effective
Time.
<PAGE>
(e) The amount of any SITEL Claim shall be reduced by the Federal and
state income tax benefits (computed using the then maximum marginal
corporate income tax rates) realized by the SITEL Indemnified Parties with
respect to such SITEL Claim. At the time the SITEL Indemnified Parties
give the Stockholders' Representative a Claim Notice, the SITEL Indemnified
Parties shall make a good faith estimate of any Federal and state income
tax benefits that will result from the Claim, and such Claim Notice shall
set forth in reasonable detail the computation of such estimated tax
benefits. If such estimated tax benefits and the SITEL Indemnified
Parties' actual tax benefits with respect to a Claim differ, prompt
adjustment shall be made for the amount of the difference at the time the
actual tax benefit is determined; provided that no adjustment shall be
made with respect to any difference which cannot reasonably be determined
until after the Survival Period.
(f) Notwithstanding anything to the contrary in this Agreement, the
NAFS Stockholders's representations, warranties and covenants do not extend
to and NAFS Stockholders shall not be obligated to indemnify the
Indemnified SITEL Parties with respect to any damages, losses,
deficiencies, liabilities, costs and expenses associated with the
termination of any NAFS state collection agency licenses at or following
the Closing solely because of the Merger.
(g) The amount of a SITEL Claim shall not bear interest except after
it has been reduced to a judgment, settlement or arbitration award and then
it shall bear interest at the judgment rate provided by Nebraska law.
(h) [Deleted]
<PAGE>
7. Section 10.5 of the Merger Agreement is amended to state in its
entirety as follows:
10.5 Application or Release of Indemnity Escrow Shares.
___________________________________________________
10.5.1 Application to Pay Indemnity Claims. During the Escrow
________________________________________________________
Period, the Escrow Agent shall deliver the Indemnity Escrow Shares from
time to time upon receipt of any of the following:
(a) A joint statement signed by SITEL and Stockholders'
Representative stating that an indemnity claim of an Indemnified
SITEL Party shall be paid out of the Indemnity Escrow Shares,
indicating the amount of the indemnity claim, the number of
Indemnity Escrow Shares to be applied to pay such indemnity claim and
the person or persons to whom such Indemnity Escrow Shares are to be
delivered; or
(b) An award rendered by an arbitrator, pursuant to an
arbitration conducted in accordance with Section 1.4.3 of the Escrow
Agreement, directing that an indemnity claim of an Indemnified SITEL
Party shall be paid out of the Indemnity Escrow Shares, indicating the
amount of the indemnity claim, the number of Indemnity Escrow Shares
to be applied to pay such indemnity claim and the person or persons to
whom such Indemnity Escrow Shares are to be delivered; or
(c) An order of a court of competent jurisdiction, which
has not been appealed within the applicable time period or is
non-appealable, directing that an indemnity claim of an
Indemnified SITEL Party shall be paid out of the Indemnity Escrow
Shares, indicating the amount of the indemnity claim, the number of
Indemnity Escrow Shares to be applied to pay such indemnity claim and
the person or persons to whom such Indemnity Escrow Shares are to be
delivered.
For purposes of this Section 10.5, unless otherwise agreed by the
Indemnified SITEL Parties and Stockholders' Representative, each Indemnity
Escrow Share shall have a deemed value of $27.375 (the price at which such
shares were valued for purposes of the Merger) and the indemnity claims
shall be paid pro rata out of the NAFS Stockholders' respective SITEL
Common Shares included within the Indemnity Escrow Shares. Delivery of
shares in respect of indemnity claims shall be effected by the Escrow Agent
delivering the certificates evidencing the Indemnity Escrow Shares to the
transfer agent for the Company together with the related stock powers (duly
completed by the Escrow Agent as to the pro rata number of shares being
delivered out of each certificate) with instructions to deliver the
appropriate number of shares from the certificates to the Company and the
balance to be reissued in the names of the NAFS Stockholders named on the
certificates and redelivered to the Escrow Agent.
10.5.2 Release Immediately Following the Escrow Period. To the extent
not previously delivered pursuant to Section 10.5.1, the Indemnity Escrow
Shares shall be delivered immediately following the expiration of the
Escrow Period. The Indemnified SITEL Parties shall receive therefrom, to
the extent not previously paid by Stockholders' Representative or NAFS
Stockholders, disbursed from the Indemnity Escrow Shares, or designated for
disbursement from the Indemnity Escrow Shares, the number of Indemnity
Escrow Shares necessary to satisfy the aggregate sum of all indemnity
claims resolved in favor of the Indemnified SITEL Parties reduced by the
aggregate sum of all indemnity claims resolved in favor of the Indemnified
NAFS Parties. The balance of the Indemnity Escrow Shares shall be
distributed to the NAFS Stockholders pro rata, in accordance with their
percentage ownership of the NAFS Common Shares (on an as converted and
fully diluted basis) outstanding immediately prior to the Effective Time.
<PAGE>
10.5.3 Non-Limitation of Liability. Nothing in this Section 10.5 or
in the Escrow Agreement shall be construed to limit the liability of the
NAFS Stockholders under Section 10.1, or under any other provisions of this
Agreement, to the amount of the Indemnity Escrow Shares.
8. Section 10.6 Right of Setoff of the Merger Agreement is deleted.
ESCROW AGREEMENT
_________________
9. Section 1.1 of the Escrow Agreement is amended to state in its
entirety as follows:
1.1 Deposit of Indemnity Escrow Shares. Pursuant to Section 4.6 of
the Merger Agreement, SITEL has delivered to Escrow Agent at Closing the
Indemnity Escrow Shares, consisting of Sixty-Eight Thousand Five Hundred
Sixty-Two (68,562) SITEL Common Shares. The Indemnity Escrow Shares are
evidenced by certificates issued in the names of the NAFS Stockholders pro
rata in accordance with their percentage ownership of the NAFS Common
Shares outstanding (on an as converted and fully diluted basis) immediately
prior to the Effective Time and include accompanying executed stock powers
with signatures appropriately guaranteed and any required transfer tax
stamps. Escrow Agent shall place the Indemnity Escrow Shares in a
segregated account (the "Escrow Account"). Escrow Agent hereby
acknowledges receipt of the Indemnity Escrow Shares. Any shares of SITEL
Common Stock that are hereafter issued in respect of the Indemnity Shares
by reason of any reclassification, stock split, subdivision or combination
of shares, recapitalization, merger or similar capital events shall be
considered part of the Indemnity Escrow Shares for all purposes and shall
be promptly delivered to the Escrow Agent to be held in the Escrow Account.
10. Section 1.4.2 of the Escrow Agreement is amended to state in its
entirety as follows:
1.4 Application or Release of Indemnity Escrow Shares. The
Escrow Agent shall deliver shares from the Indemnity Escrow Shares from
time to time pursuant to Sections 1.4.1 (Applications to Pay Indemnity
Claims) and 1.4.2 (Release Following Escrow Period).
1.4.1 Application to Pay Indemnity Claims. The Escrow Agent shall
deliver shares from the Indemnity Escrow Shares during the Escrow
Period in payment of indemnity claims within five (5) business days
after receipt of any of the following:
(a) A joint statement signed by SITEL and Stockholders'
Representative stating that an indemnity claim of an
Indemnified SITEL Party shall be paid out of the Indemnity Escrow
Shares, indicating the amount of the indemnity claim, the number of
Indemnity Escrow Shares to be applied to pay such indemnity claim and
the person or persons to whom such Indemnity Escrow Shares are to be
delivered; or
<PAGE>
(b) An award rendered by an arbitrator, pursuant to an
arbitration conducted in accordance with Section 1.4.3 of this
Escrow Agreement, directing that an indemnity claim of an
Indemnified SITEL Party shall be paid out of the Indemnity Escrow
Shares, indicating the amount of the indemnity claim, the number of
Indemnity Escrow Shares to be applied to pay such indemnity claim and
the person or persons to whom such Indemnity Escrow Shares are to be
delivered; or
(c) An order of a court of competent jurisdiction, which has
not been appealed within the applicable time period or is
non-appealable, directing that an indemnity claim of an
Indemnified SITEL Party shall be paid out of the Indemnity Escrow
Shares, indicating the amount of the indemnity claim, the number of
Indemnity Escrow Shares to be applied to pay such indemnity claim and
the person or persons to whom such Indemnity Escrow Shares are to be
delivered.
For purposes of payment of indemnity claims out of the Indemnity Escrow
Shares, unless otherwise agreed by the Indemnified SITEL Parties and
Stockholders' Representative, each Indemnity Escrow Share shall have a
deemed value of $27.375 (the price at which such shares were valued for
purposes of the Merger) and the indemnity claims shall be paid pro rata out
of the NAFS Stockholders' respective SITEL Common Shares included within
the Indemnity Escrow Shares. Delivery of shares in respect of indemnity
claims shall be effected by the Escrow Agent delivering the certificates
evidencing the Indemnity Escrow Shares to the transfer agent for the Company
together with the related stock powers (duly completed by the Escrow Agent as
to the pro rata number of shares being delivered out of each certificate) with
instructions to deliver the appropriate number of shares from the certificates
to the Company and the balance to be reissued in the names of the NAFS
Stockholders named on the certificates and redelivered to the Escrow Agent.
1.4.2 Release Following Escrow Period. To the extent not previously
distributed pursuant to Section 1.4.1, the Indemnity Escrow Shares shall be
delivered on the first business day immediately following the Escrow Period.
The Indemnified SITEL Parties shall receive therefrom, to the extent not
previously paid by Stockholders' Representative or NAFS Stockholders or
disbursed from the Indemnity Escrow Shares, the number of Indemnity Escrow
Shares necessary to satisfy the aggregate sum of all indemnity claims resolved,
in one of the manners contemplated in Section 1.4.1, in favor of the Indemnified
SITEL Parties, reduced by the aggregate sum of all indemnity claims resolved, in
one of the manners contemplated in Section 1.4.1, in favor of the Indemnified
NAFS Parties. The balance of the Indemnity Escrow Shares shall be distributed
to the Stockholders' Representative for further distribution to the NAFS
Stockholders pro rata, in accordance with their percentage ownership of the NAFS
Common Shares (on an as converted and fully diluted basis) outstanding
immediately prior to the Effective Time.
<PAGE>
1.4.3 Resolution of Dispute.
(a) Good Faith Efforts. Because pooling of interests requirements
require the distribution of the Indemnity Escrow Shares immediately
following the Escrow Period, it is necessary that SITEL and
Stockholders' Representative endeavor to reach agreement with respect
to indemnity claims as soon as practicable after such indemnity claims
arise. In furtherance thereof, SITEL and Stockholders' Representative
agree that they shall negotiate in good faith and use all reasonable
efforts to agree upon the rights of the respective parties with respect to
such indemnity claims. If SITEL and Stockholders' Representative so agree,
a certificate setting forth such agreement shall be furnished to the Escrow
Agent as provided in Section 1.4.1(a).
(b) Submission to Arbitration. If, after 30 days following receipt
by Stockholders' Representative of any indemnity claim in accordance
with Section 10.3 of the Merger Agreement, SITEL and Stockholders'
Representative have not reached final agreement upon such indemnity
claim, as evidenced by their signing and delivering to Escrow Agent a
joint certificate in accordance with Section 1.4.1(a) setting forth
such agreement or mutually agreeing that the indemnity claim should not
proceed further, then such dispute shall be settled by arbitration in
Omaha, Nebraska, before a single arbitrator pursuant to the rules of the
American Arbitration Association. Arbitration may be commenced at any time
by any party hereto giving written notice to each other party to a dispute
that such dispute has been referred to arbitration under this Section
1.4.3. With respect to all matters referred to arbitration under this
Section 1.4.3, SITEL and Stockholders' Representative shall use all
reasonable efforts to obtain expeditious arbitration with the objective of
resolving the dispute promptly and in all events prior to the expiration of
the Escrow Period. The arbitrator shall be selected by the joint agreement
of SITEL and the Stockholders' Representative, but if they do not so agree
within twenty (20) days after the date of the notice referred to above, the
selection shall be made pursuant to the rules of the Association from the
panel of arbitrators maintained by such Association. Any award rendered by
the arbitrator shall be conclusive and binding upon the parties
hereto; provided, however, that any such award shall be accompanied by
a written opinion of the arbitrator giving the reasons for the award.
This provision for arbitration shall be specifically enforceable by
the parties and the decision of the arbitrator in accordance herewith
shall be final and binding and there shall be no right of appeal
therefrom. Each party shall pay its own expenses of arbitration and
the expenses of the arbitrator shall be equally shared; provided,
however, that if in the opinion of the arbitrator any claim for
indemnification or any defense or objection thereto was unreasonable,
the arbitrator may assess, as part of his award, all or any part of
the arbitration expenses of the other party (including reasonable
attorneys' fees) and of the arbitrator against the party raising such
unreasonable claim, defense or objection.
<PAGE>
11. Article II of the Escrow Agreement is amended to state in its entirety
as follows:
ARTICLE II - DIVIDENDS, VOTING AND RIGHTS OF OWNERSHIP
Any cash dividends, dividends payable in property or other
distributions of any kind made in respect of the Indemnity Escrow Shares
shall be distributed currently by SITEL directly to the NAFS Stockholders
(or the duly registered successor holders of such Indemnity Escrow Shares)
pro rata, in accordance with their percentage ownership of the NAFS Common
Shares (on an as converted and fully diluted basis) outstanding immediately
prior to the Effective Time. Each NAFS Stockholder (or the duly registered
successor holders of such Indemnity Escrow Shares) shall have the right to
vote his or her pro rata share of the Indemnity Escrow Shares during such
time as the Indemnity Escrow Shares are held by the Escrow Agent. To the
extent Indemnity Escrow Shares are applied to indemnification obligations
of the NAFS Shareholders, any dividends paid to NAFS Shareholders in
respect of the applied Indemnity Escrow Shares shall be returned to SITEL
promptly following application of the Indemnity Escrow Shares.
REGISTRATION RIGHTS AGREEMENT
_____________________________
12. Section 10 of the Registration Rights Agreement is amended to state in
its entirety as follows:
Section 10. Lock-Up Agreement. Each Holder of Registrable
Securities has voluntarily and irrevocably offered that, in
connection with any firmly underwritten public offering of SITEL's common
stock, such Holder shall not sell, make any short sale of, loan, grant any
option for the purchase of, or otherwise dispose of any Registrable
Securities (other than those included in such firmly underwritten public
offering) without the prior written consent of SITEL or the underwriters
managing such underwritten offering, as the case may be, for such period of
time (not to exceed 90 days) from the effective date of such registration
as may be requested by such managing underwriters and SITEL has accepted
such offer in entering into this Agreement; provided, however, that the
above lockup agreement shall not apply unless all executive officers,
directors and holders of more than 10% of the SITEL's outstanding
Common Stock enter into similar agreements. In order to enforce the
foregoing covenant, SITEL may impose stop-transfer instructions with
respect to the Registrable Securities until the end of such lock-up period.
GENERAL
_______
13. Full Force and Effect. Except as modified hereby, the parties confirm
that each Agreement remains in full force and effect according to its terms
immediately prior to this Amendment. This Amendment shall be governed by
Nebraska law, without regard to its conflicts of laws principles.
[Signature page follows]
<PAGE>
SIGNATURE PAGE TO
AMENDMENT TO
AGREEMENT AND PLAN OF REORGANIZATION,
REGISTRATION RIGHTS AGREEMENT,
AND ESCROW AGREEMENT
IN WITNESS WHEREOF, the parties have executed this Amendment.
NATIONAL ACTION FINANCIAL SERVICES, INC.
By: /S/ Michael W. Fletcher
Michael W. Fletcher
Chief Executive Officer
SITEL CORPORATION
By: /S/ Barry S. Major
Barry S. Major
Chief Financial Officer
Stockholders' Representative
/S/ Michael W. Fletcher
Michael W. Fletcher,
individually and in his capacity as a
Stockholders' Representative pursuant to a
Stockholders' Representative Agreement dated as of
June 6, 1996, by and among Michael W. Fletcher and
the NAFS Stockholders signatory thereto
<PAGE>
SIGNATURE PAGE TO
AMENDMENT TO
AGREEMENT AND PLAN OF REORGANIZATION,
REGISTRATION RIGHTS AGREEMENT,
AND ESCROW AGREEMENT
(continued)
The undersigned becomes signatory to this Amendment solely in order to
indicate its acknowledgment and acceptance of the Amendments to the Escrow
Agreement set forth in paragraphs 9, 10 and 11.
FIRST BANK NATIONAL ASSOCIATION
(Escrow Agent)
By: /S/ Kathi Sites
Title: Trust Officer
Date: 4/21/97
By: /S/ Michael R. O'Malley
Title: Vice President
Date: 4/21/97
EXHIBIT 2.4(f)
AMENDMENT NO. 3
TO
SHARE PURCHASE AGREEMENT
AMENDMENT No. 3 (the "Amendment") dated April 4, 1997 among SITEL
Corporation, a Minnesota corporation (the "Buyer") and the former shareholders
of Mitre plc, an English public limited company (the "Company") listed on the
signature pages hereto (the "Sellers").
WHEREAS, the parties hereto have previously entered into a Share
Purchase Agreement dated June 6, 1996, as previously amended by Amendment No. 1
to Share Purchase Agreement dated July 26, 1996 and Amendment No. 2 to Share
Purchase Agreement dated September 3, 1996 (as so amended, the "Share Purchase
Agreement"); and
WHEREAS, the parties hereto desire to supplement and amend the
provisions of the Share Purchase Agreement in the manner set forth in this
Amendment.
NOW THEREFORE, in consideration of the mutual agreements contained
herein, the payment by the Buyer to the Sellers of the aggregate sum of 1
pound), and the payment by the Sellers to the Buyer of the aggregate sum of 1
(pound), the receipt and adequacy of which is hereby acknowledged by the Buyer
and the Sellers, the parties hereto agree as follows:
ARTICLE IV.
DEFINITIONS
1.1. Definitions
___________
Terms used herein and not otherwise defined herein shall have the meanings
set forth in the Share Purchase Agreement. Each reference to "hereof",
"hereunder", "herein" and "hereby" and each other similar reference and
each reference to "this Agreement" and each other similar reference
contained in the Share Purchase Agreement shall from and after the
effective date hereof refer to the Share Purchase Agreement as amended and
supplemented hereby.
<PAGE>
ARTICLE V.
AMENDMENT
2.1. Section 10.1(c)
_______________
Section 10.1(c) of the Share Purchase Agreement is hereby amended in its
entirety to read as follows:
(c) Time Limits. (i) The rights of the Buyer in respect of any
breach or non-fulfillment of any of the Warranties shall only be
enforceable until the earlier of (i) the first anniversary of the
Completion Date, and (ii) completion of the first combined audit of
the Buyer and the Company.
(ii) The rights of the Buyer in respect of any breach or non
fulfillment of any of the terms of the Tax Covenant shall only be
enforceable until the earlier of (i) the first anniversary of the
Completion Date, and (ii) completion of the first combined audit of
the Buyer and the Company.
2.3. Section 10.1(e)
_______________
Section 10.1(e) of the Share Purchase Agreement is hereby amended in its
entirety to read as follows:
(e) Maximum Claims. The Buyer shall not be entitled to recover
under the Warranties and the Tax Covenant any sum in excess of $25
million in the aggregate. Any payment made in respect of a claim
under the Warranties shall be made in Buyer Stock or, to the extent
that the Buyer Stock held by the Sellers (including, without
limitation, Buyer Stock held in escrow pursuant to the Escrow
Agreement) is insufficient to satisfy such claim, in cash. If such
payment is made in Buyer Stock, the value of the Buyer Stock shall be
the closing price of the Buyer Stock on the NASDAQ on the Completion
Date. Each Seller shall only be liable for his Appropriate Proportion
of any claim made by the Buyer in respect of any breach of the
Warranties or under the Tax Covenant and, in this Article, the
expression "Appropriate Proportion" means the proportion which the
Shares to be sold by the Seller hereunder bear to the total Shares to
be sold under this Agreement.
2.4. Section 10.1(h)
_______________
Section 10.1(h) of the Share Purchase Agreement is hereby amended in its
entirety to read as follows:
(h) Contingent Liabilities. The Sellers shall not be liable for
breach of any Warranty or under the Tax Covenant in respect of any
claim based upon a liability which is contingent unless and until such
contingent liability becomes an actual liability and is due and
payable before the expiry of the periods specified in subclause
10.1(c).
<PAGE>
ARTICLE VI.
MISCELLANEOUS
3.1. Governing Law. This Amendment shall be governed by and
construed in accordance with the laws of England and Wales and each of the
parties hereto submits to the exclusive jurisdiction of the English Courts.
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to
be duly executed by their respective authorized officers as of the date and year
first above written.
SITEL CORPORATION
By: /s/ Barry S. Major
Name: Barry S. Major
Title: Chief Financial Officer
BURMEL HOLDINGS NV
By: /s/ Henk P. Kruithof
Name: Henk P. Kruithof
Title: Attorney
/s/ Ray F. Pipe
Ray F. Pipe
/s/ Peter L.R. Godfrey
Peter L.R. Godfrey
/s/ Andrew J. Tillard
Andrew J. Tillard
/s/ Martin J. Shields
Martin J. Shields
/s/ M.E.O. Bilton
M.E.O. Bilton
/s/ K.M. Mather
K.M. Mather
/s/ J.C. White
J.C. White
/s/ G. Hurley
G. Hurley
<PAGE>
/s/ Thomas A. Fitzherbert
The Hon. T.A. Fitzherbert
MERIT GROUP NV (in liquidation), by its
former shareholders:
/s/ Henk P. Kruithof
Henk P. Kruithof
/s/ M. Vanbaelen
M. Vanbaelen
/s/ J. Braem
J. Braem
/s/ T. Vanparys
T. Vanparys
/s/ L. Bollaerts
L. Bollaerts
/s/ E. Van De Poel
E. Van De Poel
/s/ Dirk Frans
D. Frans
EXHIBIT 2.4(g)
AMENDMENT NO. 1
TO
ESCROW AGREEMENT
AMENDMENT No. 1 (the "Amendment") dated April 4, 1997 among SITEL
Corporation, a Minnesota corporation (the "Buyer"), the former shareholders of
Mitre plc listed on the signature pages hereto (the "Sellers"), and Firstar
Trust Company, as Escrow Agent ("Escrow Agent").
WHEREAS, the parties hereto have previously entered into an Escrow
Agreement dated September 3, 1996 (the "Escrow Agreement"); and
WHEREAS, the parties hereto desire to supplement and amend the provisions
of the Escrow Agreement in the manner set forth in this Amendment.
NOW THEREFORE, in consideration of the mutual agreements contained herein,
the payment by the Buyer to the Sellers of the aggregate sum of 1 (pound),
and the payment by the Sellers to the Buyer of the aggregate sum of 1(pound),
the receipt and adequacy of which is hereby acknowledged by the Buyer and the
Sellers, the parties hereto agree as follows:
ARTICLE I.
DEFINITIONS
1.1. Definitions
Terms used herein and not otherwise defined herein shall have the meanings
set forth in the Escrow Agreement. Each reference to "hereof",
"hereunder", "herein" and "hereby" and each other similar reference and
each reference to "this Agreement" and each other similar reference
contained in the Escrow Agreement shall from and after the effective date
hereof refer to the Escrow Agreement as amended and supplemented hereby.
<PAGE>
ARTICLE II.
AMENDMENT
2.1. Section 4(e)
Section 4(e) of the Escrow Agreement is hereby amended in its entirety to
read as follows:
(e) Each Seller shall, in respect of any Sellers' Payment which
is the subject of any Escrow Account Payment Claim, pay such amounts
in cash if and only to the extent that the shares of Buyer Stock then
held by such Seller (including, without limitation, shares held in the
Escrow Account) have a value less than the amount of the Sellers'
Payment as stated in such Escrow Account Payment Claim. For purposes
of this Section, the value of each Seller's Buyer Stock (including,
without limitation, shares held in the Escrow Account) shall be the
closing price of the Buyer Stock on the NASDAQ on the Completion Date
(as defined in the Share Purchase Agreement).
ARTICLE III.
MISCELLANEOUS
3.1. Governing Law. This Amendment shall be construed in accordance
with and governed by the laws of the State of New York, without regard to the
conflict of law rules of such state.
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to
be duly executed by their respective authorized officers as of the date and year
first above written.
SITEL CORPORATION
By: /s/ Barry S. Major
Name: Barry S. Major
Title: Chief Financial Officer
BURMEL HOLDINGS NV
By: /s/ Henk P. Kruithof
Name: Henk P. Kruithof
Title: Attorney
RAYMOND F. PIPE
/s/ Raymond F. Pipe
PETER L.R. GODFREY
/s/ Peter L.R. Godfrey
ANDREW J. TILLARD
/s/ Andrew J. Tillard
MARTIN J. SHIELDS
/s/ M.J. Shields
<PAGE>
MARGOT E.O. BILTON
/s/ M.E.O. Bilton
KATHARINE M. MATHER
/s/ K.M. Mather JAMES
C. WHITE
/s/ J.C. White
GLENN HURLEY
/s/ Glenn Hurley
THOMAS A. FITZHERBERT
/s/ Thomas A. Fitzherbert
MERIT GROUP NV (in liquidation) by its former
shareholders:
/s/ Henk P. Kruithof
Henk P. Kruithof
/s/ M. Vanbaelen
M. Vanbaelen
/s/ J. Braem
J. Braem
<PAGE>
/s/ T. Vanparys
T. Vanparys
/s/ L. Bollaerts
L. Bollaerts
/s/ E. Van De Poel
E. Van De Poel
/s/ Dirk Frans
D. Frans
FIRSTAR TRUST COMPANY
as Escrow Agent
By: /s/ William Caruso
Name: William Caruso
Title: Assistant Vice President
By: /s/ Amy E. Nolde
Name: Amy E. Nolde
Title: Assistant Secretary
EXHIBIT 2.4(h)
AMENDMENT NO. 1
TO
REGISTRATION RIGHTS AGREEMENT
AMENDMENT No. 1 (the "Amendment") dated April 4, 1997 among SITEL
Corporation, a Minnesota corporation ("SITEL") and certain stockholders of SITEL
listed on the signature pages hereto (each, a "Seller").
WHEREAS, the parties hereto have previously entered into a
Registration Rights Agreement dated September 3, 1996 (the "Registration Rights
Agreement"); and
WHEREAS, the parties hereto desire to supplement and amend the
provisions of the Registration Rights Agreement in the manner set forth in
this Amendment.
NOW THEREFORE, in consideration of the mutual agreements contained
herein, the payment by SITEL to the Sellers of the aggregate sum of 1(pound),
and the payment by the Sellers to SITEL of the aggregate sum of 1(pound), the
receipt and adequacy of which is hereby acknowledged by SITEL and the Sellers,
the parties hereto agree as follows:
ARTICLE I.
DEFINITIONS
1.1. Definitions
Terms used herein and not otherwise defined herein shall have the meanings
set forth in the Registration Rights Agreement. Each reference to
"hereof", "hereunder", "herein" and "hereby" and each other similar
reference and each reference to "this Agreement" and each other similar
reference contained in the Registration Rights Agreement shall from and
after the effective date hereof refer to the Registration Rights Agreement
as amended and supplemented hereby.
<PAGE>
ARTICLE II.
AMENDMENT
2.1. Section 3.4
Section 3.4 of the Registration Rights Agreement is hereby amended in its
entirety to read as follows:
Holdback Agreements. Each Shareholder has voluntarily and
irrevocably offered not to offer, sell, contract to sell or otherwise
dispose of any Registrable Securities, or any securities convertible
into or exchangeable or exercisable for such securities, during the 14
days prior to, and during the 180-day period beginning on, the
effective date of such registration statement, other than the
Registrable Securities to be sold pursuant to such registration
statement, and SITEL has accepted such offer of each Shareholder in
entering into this Agreement.
2.2. Section 3.5
Section 3.5 of the Registration Rights Agreement is hereby amended in its
entirety to read as follows:
Additional Restrictions on Sale. Each Shareholder has voluntarily and
irrevocably offered not to offer, sell, contract to sell or otherwise
dispose of any Registrable Securities, or any securities convertible
into or exchangeable or exercisable for such securities, prior to the
public release of the results of the first 30 days of combined
operations of SITEL and Mitre plc, and SITEL has accepted such offer
of each Shareholder in entering into this Agreement.
ARTICLE III.
MISCELLANEOUS
3.1. Governing Law. This Amendment shall be governed by and
construed in accordance with the laws of the State of New York, without
reference to its conflicts of law rules.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
duly executed by their respective authorized officers as of the date and year
first above written.
SITEL CORPORATION
By: /s/ Barry S. Major
Name: Barry S. Major
Title: Chief Financial Officer
BURMEL HOLDINGS NV
By: /s/ Henk P. Kruithof
Name: Henk P. Kruithof
Title: Attorney
RAYMOND F. PIPE
/s/ Raymond F. Pipe
PETER L.R. GODFREY
/s/ Peter L.R. Godfrey
ANDREW J. TILLARD
/s/ Andrew J. Tillard
MARTIN J. SHIELDS
/s/ M.J. Shields
MARGOT E.O. BILTON
/s/ M.E.O. Bilton
KATHARINE M. MATHER
/s/ K.M. Mather
<PAGE>
JAMES C. WHITE
/s/ J.C. White
GLENN HURLEY
/s/ Glenn Hurley
THOMAS A. FITZHERBERT
/s/ Thomas A. Fitzherbert
MERIT GROUP NV (in liquidation), by its former
shareholders:
HENK P. KRUITHOF
/s/ Henk P. Kruithof
M. VANBAELEN
/s/ M. Vanbaelen
J. BRAEM
/s/ J. Braem
T. VANPARYS
/s/ T. Vanparys
L. BOLLAERTS
/s/ L. Bollaerts
E. VAN DE POEL
/s/ E. Van De Poel
D. FRANS
/s/ Dirk Frans
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM FORM 10Q
AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FORM 10Q.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> MAR-31-1997
<CASH> 8,147
<SECURITIES> 1,525
<RECEIVABLES> 90,215
<ALLOWANCES> 3,645
<INVENTORY> 0
<CURRENT-ASSETS> 105,698
<PP&E> 116,661
<DEPRECIATION> 38,850
<TOTAL-ASSETS> 270,889
<CURRENT-LIABILITIES> 82,441
<BONDS> 0
0
0
<COMMON> 61
<OTHER-SE> 151,927
<TOTAL-LIABILITY-AND-EQUITY> 270,889
<SALES> 0
<TOTAL-REVENUES> 104,260
<CGS> 0
<TOTAL-COSTS> 93,599
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 534
<INCOME-PRETAX> 10,127
<INCOME-TAX> 3,643
<INCOME-CONTINUING> 6,454
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 6,454
<EPS-PRIMARY> 0.10
<EPS-DILUTED> 0.10
</TABLE>
