-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, H3oyXeJLp7UzDQcY2uw/zT4mSAOW65njpjk+FVZN8DB6o1P1XSdCnOS/eSLL0DB9 ZVFvYOXUJ6xkYSxAo4bRLw== 0000950137-00-002142.txt : 20000508 0000950137-00-002142.hdr.sgml : 20000508 ACCESSION NUMBER: 0000950137-00-002142 CONFORMED SUBMISSION TYPE: SC 13D/A PUBLIC DOCUMENT COUNT: 5 FILED AS OF DATE: 20000505 GROUP MEMBERS: HALMOSTOCK LIMITED PARTNERSHIP GROUP MEMBERS: SAMSTOCK LLC SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: TRANSMEDIA NETWORK INC /DE/ CENTRAL INDEX KEY: 0000078536 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-BUSINESS SERVICES, NEC [7389] IRS NUMBER: 846028875 STATE OF INCORPORATION: DE FISCAL YEAR END: 0930 FILING VALUES: FORM TYPE: SC 13D/A SEC ACT: SEC FILE NUMBER: 005-35249 FILM NUMBER: 621093 BUSINESS ADDRESS: STREET 1: 11900 BISCAYNE BLVD STREET 2: STE 460 CITY: MIAMI STATE: FL ZIP: 33181 BUSINESS PHONE: 3058923300 MAIL ADDRESS: STREET 1: 11900 BISCAYNE BLVD STREET 2: SUITE 460 CITY: MIAMI STATE: FL ZIP: 33181 FORMER COMPANY: FORMER CONFORMED NAME: PIKES PEAK AMERICAN CORP DATE OF NAME CHANGE: 19840912 FORMER COMPANY: FORMER CONFORMED NAME: PIKES PEAK TURF CLUB INC DATE OF NAME CHANGE: 19740728 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: SAMSTOCK LLC CENTRAL INDEX KEY: 0001051877 STANDARD INDUSTRIAL CLASSIFICATION: [] IRS NUMBER: 364156890 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D/A BUSINESS ADDRESS: STREET 1: TWO NORTH RIVERSIDE PLAZA CITY: CHICAGO STATE: IL ZIP: 60606 BUSINESS PHONE: 3124664010 MAIL ADDRESS: STREET 1: TWO NORTH RIVERSIDE PLAZA CITY: CHICAGO STATE: IL ZIP: 60606 SC 13D/A 1 AMENDMENT TO SCHEDULE 13D 1 SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 SCHEDULE 13D/A UNDER THE SECURITIES EXCHANGE ACT OF 1934 (AMENDMENT NO. 4) TRANSMEDIA NETWORK INC. (NAME OF ISSUER) COMMON STOCK, PAR VALUE $0.02 PER SHARE (TITLE OF CLASS OF SECURITIES) 893767103 (CUSIP NUMBER) JOSEPH M. PAOLUCCI EQUITY GROUP INVESTMENTS, L.L.C. TWO NORTH RIVERSIDE PLAZA, SUITE 600 CHICAGO, ILLINOIS 60606 (312) 466-3885 (NAME, ADDRESS AND TELEPHONE NUMBER OF PERSON AUTHORIZED TO RECEIVE NOTICES AND COMMUNICATIONS) APRIL 28 AND MAY 1, 2000 (DATE OF EVENT WHICH REQUIRES FILING OF THIS STATEMENT) If the filing person has previously filed a statement on Schedule 13G to report the acquisition which is the subject of this Schedule 13D, and is filing this Schedule because of Rule 13d-1(b)(3) or (4), check the following box [ ]. 2
CUSIP No. 893767-103 SCHEDULE 13D PAGE 2 OF ___ - ------------------------------------------------------------------------------------------------------------------------------ 1 NAME OF REPORTING PERSON S.S. or I.R.S. IDENTIFICATION NO. OF ABOVE PERSON Samstock L.L.C. FEIN: 36-4156890 - ------------------------------------------------------------------------------------------------------------------------------ 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [X] (b) [ ] - ------------------------------------------------------------------------------------------------------------------------------ 3 SEC USE ONLY - ------------------------------------------------------------------------------------------------------------------------------ 4 SOURCE OF FUNDS* WC - ------------------------------------------------------------------------------------------------------------------------------ 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e) [ ] - ------------------------------------------------------------------------------------------------------------------------------ 6 CITIZENSHIP OR PLACE OF ORGANIZATION Delaware - ------------------------------------------------------------------------------------------------------------------------------ 7 SOLE VOTING POWER 0 NUMBER OF SHARES ---------------------------------------------------------------------------------------------- BENEFICIALLY 8 SHARED VOTING POWER OWNED BY EACH REPORTING 8,322,632* PERSON WITH ---------------------------------------------------------------------------------------------- 9 SOLE DISPOSITIVE POWER 6,766,057 ---------------------------------------------------------------------------------------------- 10 SHARED DISPOSITIVE POWER 1,556,575 - ------------------------------------------------------------------------------------------------------------------------------ 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 8,322,632* - ------------------------------------------------------------------------------------------------------------------------------ 12 CHECK BOX IF AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* [ ] - ------------------------------------------------------------------------------------------------------------------------------ 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 42.3% - ------------------------------------------------------------------------------------------------------------------------------ 14 TYPE OF REPORTING PERSON* 00 - ------------------------------------------------------------------------------------------------------------------------------
2 3 * Represents the number of shares which are beneficially owned by all members of the group, in the aggregate, and which are subject to voting arrangements set forth more fully in Items 3 and 4 below. This filing shall not be construed as an admission that such reporting person is the beneficial owner of all of such shares. 3 4 - ------------------------------------------------------------------------------------------------------------------------------ 1 NAME OF REPORTING PERSON S.S. or I.R.S. IDENTIFICATION NO. OF ABOVE PERSON Halmostock Limited Partnership FEIN #83-0319692 - ------------------------------------------------------------------------------------------------------------------------------ 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [X] (b) [ ] - ------------------------------------------------------------------------------------------------------------------------------ 3 SEC USE ONLY - ------------------------------------------------------------------------------------------------------------------------------ 4 SOURCE OF FUNDS* WC - ------------------------------------------------------------------------------------------------------------------------------ 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e) [ ] - ------------------------------------------------------------------------------------------------------------------------------ 6 CITIZENSHIP OR PLACE OF ORGANIZATION Wyoming - ------------------------------------------------------------------------------------------------------------------------------ 7 SOLE VOTING POWER 0 NUMBER OF SHARES ---------------------------------------------------------------------------------------------- BENEFICIALLY 8 SHARED VOTING POWER OWNED BY EACH REPORTING 8,322,632* PERSON WITH ---------------------------------------------------------------------------------------------- 9 SOLE DISPOSITIVE POWER 0 ---------------------------------------------------------------------------------------------- 10 SHARED DISPOSITIVE POWER 716,566 - ------------------------------------------------------------------------------------------------------------------------------ 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 8,322,632* - ------------------------------------------------------------------------------------------------------------------------------ 12 CHECK BOX IF AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* [ ] - ------------------------------------------------------------------------------------------------------------------------------ 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 42.3% - ------------------------------------------------------------------------------------------------------------------------------ 14 TYPE OF REPORTING PERSON* 00 - ------------------------------------------------------------------------------------------------------------------------------
4 5 * Represents the number of shares which are beneficially owned by all members of the group, in the aggregate, and which are subject to voting arrangements set forth more fully in Items 3 and 4 below. This filing shall not be construed as an admission that such reporting person is the beneficial owner of all of such shares. 5 6 This Amendment No. 4 to Schedule 13D relates to the common stock, par value $.02 per share ("Common Stock"), of Transmedia Network Inc. (the "Issuer"). Items 2, 3, 4, 5, and 7 of the Schedule 13D are hereby amended to read in their entirety as follows: ITEM 2. Identity and Background (a-c) This Statement is being filed by the following beneficial owners of Common Stock: Samstock, L.L.C., a Delaware limited liability company ("Samstock"), and Halmostock Limited Partnership, a Wyoming limited partnership ("Halmostock"). (Samstock and Halmostock are referred to herein, individually, as a "Stockholder" and, collectively, as the "Stockholders."). The sole member of Samstock is SZ Investments, L.L.C., a Delaware limited liability company ("SZI"). The managing member of SZI is Zell General Partnership, Inc., an Illinois corporation ("ZGP"). The general partner of Halmostock is Halmos Investments-Western, Inc., a Wyoming corporation ("HIW"). Additional information concerning SZI, ZGP and HIW is set forth in Appendix A hereto. The principal business of Samstock, SZI and ZGP is general investments. The business address of Samstock, SZI and ZGP is Two North Riverside Plaza, Chicago, Illinois, 60606. The principal business of Halmostock is investment in the securities of the Issuer and the principal business of HIW is general investments. The business address of Halmostock and HIW is 21 W. Las Olas Boulevard, Fort Lauderdale, Florida, 33301. (d) and (e) Neither the Stockholders nor, to the best knowledge of the Stockholders, any of SZI, ZGP or HIW, or any of the persons listed in Appendix A hereto, have during the last five years (i) been convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors) or (ii) been a party to a civil proceeding of a judicial or administrative body of competent jurisdiction and as a result of such proceeding was, or is, subject to a judgment, decree or final order enjoining future violations of, or prohibiting or mandating activities subject to federal or state securities laws or finding any violation with respect to such laws. ITEM 3. Source and Amount of Funds or Other Consideration Pursuant to a Stock Purchase and Sale Agreement dated as of November 6, 1997 among EGI-Transmedia Investors, L.L.C., a Delaware limited liability company ("TMI"), Samstock and the Issuer (the "Stock Purchase Agreement"), TMI and Samstock agreed to acquire in the aggregate (i) 2,500,000 newly issued shares of Common Stock (the "Shares") and (ii) warrants to purchase an additional 1,200,000 shares of Common Stock (the "Warrant Shares"), subject to the satisfaction of certain conditions precedent. The Stock Purchase Agreement was attached as Exhibit 1 to the original Schedule 13D and is incorporated herein by reference. The principal business of TMI was investment in the securities of the Issuer. On September 23, 1999, TMI distributed all of the securities of the Issuer held by it to TMI's members without additional consideration (the "TMI Distribution"). TMI has had no investment in the securities of the Issuer since the TMI Distribution. Pursuant to an Assignment Agreement dated as of March 3, 1998 (the "Initial Investment Closing Date") among the Stockholders and the Issuer (the "Assignment Agreement"), effective contemporaneously with the closing under the Stock Purchase Agreement, TMI and Samstock assigned to Halmostock the right to acquire 352,941 of the Shares and 169,412 of the Warrant Shares. The Assignment Agreement was attached as Exhibit 2 to Amendment Number 1 to Schedule 13D and is incorporated herein by reference. In addition, Halmostock is the beneficial owner of 92,000 shares of Common Stock, which 92,000 shares were contributed to Halmostock by Steven J. Halmos prior to the Initial Investment Closing Date. 6 7 On the Initial Investment Closing Date, TMI acquired 322,059 of the Shares and 154,588 of the Warrant Shares and Samstock acquired 1,825,000 of the Shares and 876,000 of the Warrant Shares, for a total aggregate consideration of $9,125,000.75, the source of which was capital contributions to TMI and Samstock by the members of TMI and Samstock, respectively. In addition, on the Initial Investment Closing Date, Halmostock acquired 352,941 Shares and 169,412 Warrant Shares for a total aggregate consideration of $1,499,999.25 paid to the Issuer, the source of which was a loan of $1,534,999.25 from an affiliate of Halmostock, which affiliate is a Wyoming limited partnership the general partner of which is HIW. The loan was made pursuant to a note dated March 2, 1998, is payable on demand, and bears interest at a rate of 8% per annum. The acquisition of the Shares and Warrant Shares by TMI, Samstock and Halmostock described in this paragraph are referred to herein collectively as the "Initial Investment." Effective as of the Initial Investment Closing Date, immediately after the closing of the Initial Investment, Samstock sold to Robert M. Steiner, as trustee under the declaration of trust dated March 9, 1983, as amended, establishing the Robert M. Steiner Revocable Trust ("Steiner Trust"), 40,364 of the Shares and 19,375 of the Warrant Shares for a purchase price in cash in the amount of $171,547.00, and Halmostock sold to the Steiner Trust 6,636 of the Shares and 3,185 of the Warrant Shares, for a purchase price in cash of $28,203.00. In connection with the Initial Investment, TMI, Samstock, the Issuer, Melvin Chasen and Iris Chasen (Melvin Chasen and Iris Chasen being referred to herein, together, as the "Chasens") have also entered into an Amended and Restated Agreement Among Stockholders dated as of March 3, 1998 (the "Amended Agreement Among Stockholders"), which amends, restates and supersedes an Agreement Among Stockholders dated as of November 6, 1997 among the same parties. Pursuant to the Amended Agreement Among Stockholders, TMI and Samstock acquired the sole power to vote or to direct the vote of all of the shares of Common Stock and other voting securities of the Issuer held by the Chasens (the "Chasen Shares"), whether now owned or hereafter acquired, subject to certain limitations in the Investment Agreement described below. There are currently 745,839 Chasen Shares issued and outstanding known to the Reporting Persons, representing 5.1% of the issued and outstanding Common Stock. The Amended Agreement Among Stockholders also provides that, subject to certain limitations, TMI and Samstock have a right of first refusal on all sales of the Chasen Shares, and the Chasen Shares are subject to "co-sale" and "drag along" provisions if TMI and Samstock sell any shares they may own. On September 7, 1999, Samstock exercised its right of first refusal on a portion of the Chasen Shares, thereby acquiring from the Chasens 135,000 of the Chasen Shares for an aggregate purchase price of $472,500 in cash, the source of which was Samstock's working capital. The Amended Agreement Among Stockholders will terminate if Stockholders and their affiliates (the "Stockholder Group") cease to own in the aggregate at least 5% of the Issuer's Common Stock (or other securities of the Issuer entitled to vote generally for the election of directors or securities convertible into or exchangeable for Common Stock or such voting securities or other options or rights to acquire Common Stock or such voting securities) (collectively, the "Voting Securities"). The Amended Agreement Among Stockholders was attached as Exhibit 3 to Amendment Number 1 to Schedule 13D and is incorporated herein by reference. Also in connection with the Initial Investment, the Stockholders and the Issuer have entered into a Stockholders' Agreement dated as of March 3, 1998 (the "Stockholders Agreement"), pursuant to which TMI and Samstock acquired the sole power to vote or to direct the vote of all of the shares of Common Stock and other voting securities of the Issuer held by Halmostock (the "Halmostock Shares"), whether now owned or hereafter acquired, subject to certain limitations in the Investment Agreement described below. There are currently 438,305 Halmostock Shares issued and outstanding, representing 3.0% of the issued and outstanding Common Stock. In addition, Halmostock owns 206,204 Preferred Shares (as hereinafter defined) and warrants in respect of 166,227 Warrant Shares and which, together with the 438,305 issued and outstanding Halmostock Shares, represent 5.4% of the Common Stock, including the 166,227 Warrant Shares and the 206,204 Preferred Shares. 7 8 Like the Amended Agreement Among Stockholders, the Stockholders Agreement also provides that, subject to certain limitations, TMI and Samstock have a right of first refusal on all sales of the Halmostock Shares, and the Halmostock Shares are subject to "co-sale" and "drag along" provisions if TMI and Samstock sell any shares they may own. The Stockholders Agreement will terminate if the Stockholder Group ceases to own in the aggregate at least 5% of the Issuer's Voting Securities. The Stockholders Agreement was attached as Exhibit 4 to Amendment Number 1 to Schedule 13D and is incorporated herein by reference. The summary contained in this Statement of certain provisions of each of the Stock Purchase Agreement, the Assignment Agreement, the Amended Agreement Among Stockholders and the Stockholders Agreement is not intended to be complete and is qualified in its entirety by reference to the Stock Purchase Agreement, the Assignment Agreement, the Amended Agreement Among Stockholders and the Stockholders Agreement, each of which was attached as an exhibit to the original Schedule 13D or Amendment Number 1 to Schedule 13D and is incorporated herein by reference. In June 1999, the Issuer entered into a $10 million loan agreement (the "GAMI Loan Agreement") with GAMI Investments, Inc. ("GAMI"), an affiliate of Samstock. The Issuer drew down the entire $10 million principal amount available under the GAMI Loan Agreement on June 30, 1999 (the "GAMI Loan"). The GAMI Loan Agreement obligated the Issuer to conduct a $10,000,000 rights offering (the "Rights Offering") for shares of a newly created series of convertible preferred stock (the "Series A Preferred Stock") described in the Issuer's definitive proxy statement filed with the Securities Exchange Commission on September 17, 1999. The Issuer conducted the Rights Offering as required by the GAMI Loan Agreement. The Rights Offering closed on November 9, 1999 (the "Rights Offering Closing"). The GAMI Loan Agreement was attached as Exhibit 6 to Amendment Number 2 to Schedule 13D and is incorporated herein by reference. The summary contained in this Statement of certain provisions of the GAMI Loan Agreement is not intended to be complete and is qualified in its entirety by reference to the GAMI Loan Agreement. The TMI Distribution occurred on September 23, 1999. Samstock was one of TMI's members and received in the TMI Distribution 100,883 of the Shares and a warrant representing 48,424 of the Warrant Shares. The balance of the Shares and the Warrant Shares previously held by TMI were distributed to other members of TMI, and Samstock does not have sole or shared voting or dispositive power over such Shares and Warrant Shares. In connection with the Rights Offering, Samstock and the Issuer entered into a Standby Purchase Agreement dated as of June 30, 1999 (the "Standby Purchase Agreement"), whereby Samstock agreed to act as a standby purchaser to ensure that $10 million in proceeds are raised in the Rights Offering. The Issuer was required to use all proceeds of the Rights Offering to repay the outstanding amount of the GAMI Loan. Under the Standby Purchase Agreement, Samstock was obligated to exercise its basic subscription privilege in full and to purchase, at the subscription price, all shares of Series A Preferred Stock offered pursuant to the Rights Offering which were not subscribed for by other stockholders (including pursuant to any oversubscription privilege). Pursuant to the Standby Purchase Agreement, Samstock purchased 2,840,489 shares of Series A Preferred Stock at the Rights Offering Closing for an aggregate purchase price of $6,845,577.51 or $2.41 per share in cash, the source of which was capital contributions to Samstock by the members of Samstock. At the Rights Offering Closing, the Issuer used all of the proceeds therefrom to repay the outstanding amount of the GAMI Loan which was $10,135,208.33 including accrued interest. In addition, Halmostock has advised Samstock that Halmostock purchased 206,204 shares of Series A Preferred Stock in the Rights Offering for an aggregate purchase price of $496,952.04 or $2.41 per share, the source of which was a loan from an affiliate. The 2,840,489 shares of Series A Preferred Stock acquired by Samstock and the 206,204 shares of Series A Preferred Stock acquired by Halmostock are collectively referred to as the "Preferred Shares." The Standby Purchase Agreement was attached as Exhibit 7 to Amendment No. 2 to Schedule 13D and is incorporated herein by reference. In consideration of Samstock's commitment under the Standby Purchase Agreement and of the provision of the GAMI Loan by GAMI, the Issuer issued to Samstock at the Rights Offering Closing a non-transferable five-year warrant (the "Rights Offering Warrant") to purchase 1,000,000 shares of the Issuer's common stock (the "Rights Offering Warrant 8 9 Shares"). A copy of the Rights Offering Warrant was attached as Exhibit 10 to Amendment No. 3 to Schedule 13D and is incorporated herein by reference. The summary contained in this Statement of certain provisions of the Standby Purchase Agreement and the Rights Offering Warrant is not intended to be complete and is qualified in its entirety by reference to the Standby Purchase Agreement and the Rights Offering Warrant attached as an exhibit to Amendment No. 2 to Schedule 13D or hereto and incorporated herein by reference. In connection with the Initial Investment, the Stockholders and the Issuer entered into an Amended and Restated Investment Agreement dated as of March 3, 1998 (the "First Amended Investment Agreement"), which amended, restated and superseded an Investment Agreement dated as of November 6, 1997 among TMI, Samstock and the Issuer. The Steiner Trust joined the First Amended Investment Agreement only for purposes of Section 5 thereof in connection with its purchase of a portion of the Samstock Shares and Halmostock Shares described above. In connection with the GAMI Loan and the Standby Purchase Agreement, the Stockholders (other than Halmostock), the Issuer, and for purposes of Section 5 thereof only, the Steiner Trust, entered into a Second Amended and Restated Investment Agreement dated as of June 30, 1999 (the "Second Amended Investment Agreement"), which amends, restates and supersedes the First Amended Investment Agreement, only with respect to the rights and obligations of each of the parties to the First Amended Investment Agreement other than Halmostock. The First Amended and Restated Investment Agreement continues in full force and effect with respect to the rights and obligations of Halmostock thereunder vis a vis each of the other Stockholders and the Issuer. The Second Amended Investment Agreement contains agreements as to certain aspects of the relationship among the Stockholders other than Halmostock and the Issuer. The Second Amended Investment Agreement was attached to Amendment No. 2 to Schedule 13D as Exhibit 8 thereto and is incorporated herein by reference. The First Amended Investment Agreement and the Second Amended Investment Agreement read together are collectively referred to herein as the "Investment Agreement." Pursuant to the Investment Agreement, the Stockholders agreed that the members of the Stockholder Group will not take any of the following actions (collectively, the "Standstill Provisions") prior to the fifth anniversary of the Initial Investment Closing Date, without the approval of a majority of the Issuer's disinterested directors, subject to specified limited exceptions: (a) increase their ownership of Voting Securities beyond the combined voting power of all Voting Securities represented by the Shares, the Warrant Shares, the Preferred Shares or the Rights Offering Warrant Shares or subject to the Amended Agreement Among Stockholders or Stockholders Agreement; provided, however, that the foregoing limitation shall not prohibit the purchase of Voting Securities directly from the Issuer pursuant to exercise of the warrants and any rights, oversubscription rights or standby purchase obligations in connection with rights offerings by the Issuer or exercise of any stock options granted by the Issuer; (b) solicit proxies, assist any other person in the solicitation of proxies, become a "participant" in a "solicitation" or assist any such "participant" (as such terms are defined in Rule 14a-1 of Regulation 14A under the Securities Exchange Act of 1934, as amended) in opposition to the recommendation of a majority of disinterested directors, or submit any proposal for the vote of Issuer's stockholders; (c) form, join or participate in any other way in a partnership, pooling agreement, syndicate, voting trust or other "group", or enter into any agreement or arrangement or otherwise act in concert with any other person, for the purpose of acquiring, holding, voting or disposing of Voting Securities of the Issuer; provided, however, that the members of the Stockholder Group may engage in any of such activities among themselves and with any stockholder of the Issuer who is a party to the Amended Agreement Among Stockholders or the Stockholders Agreement; (d) engage in certain specified takeover actions or take any other actions, alone or in concert with any other person, to seek control of the Issuer; or (e) take any action to seek to circumvent any of the foregoing limitations. Pursuant to the Investment Agreement, at all times prior to the fifth anniversary of the date of the Initial Investment Closing Date, Samstock is entitled to designate two representatives, reasonably acceptable to the independent directors of the Issuer, to serve on the Board of Directors of the Issuer (the "Board") as long as the Stockholders together beneficially own at least 15% of the combined voting power of the Issuer's Voting Securities (including, for these purposes, the Warrant Shares and the Rights Offering Warrant Shares issuable upon exercise of the warrants until such time as the warrants expire) and, in the event that the Stockholders together beneficially own less than 15%, but at least 5%, of the 9 10 combined voting power of the Issuer's Voting Securities, Samstock shall be entitled to designate one representative, reasonably acceptable to the independent directors of the Issuer, to serve on the Issuer's Board. The Issuer agreed that it will not increase the size of the Board beyond seven members as long as Samstock is entitled to designate one or two Board representatives, except in furtherance of the exercise by Samstock of its rights under the Investment Agreement, and further agreed that, notwithstanding the agreements contained in the Amended Agreement Among Stockholders, the chief executive officer of the Issuer shall not count as a designee of Samstock. Pursuant to the Investment Agreement, in addition to any other rights to designate directors of the Issuer thereunder, because Samstock, pursuant to the Standby Purchase Agreement, purchased more than 25% of the total number of shares of Series A Preferred Stock issued by the Issuer in the Rights Offering (exclusive of those shares of Series A Preferred Stock purchased by Samstock pursuant to its basic subscription privilege or its obligation to purchase shares of Series A Preferred Stock not purchased by TMI or TMI's members pursuant to its or their basic subscription privileges), Samstock has the right to designate one additional director of the Issuer, which individual may be designated in Samstock's sole discretion without obtaining the acceptance or approval of the Issuer's disinterested directors or any other person or entity, to serve for a period of three years or, if earlier, until the time when the Stockholders together beneficially own less than 15% of the combined voting power of the Issuer's Voting Securities. Samstock has not yet designated its additional Board member. Pursuant to the Investment Agreement, the Stockholders agreed that, except to the extent otherwise provided in the Investment Agreement, the Stockholders would vote their Voting Securities with respect to the election or removal of directors of the Issuer either (a) in accordance with the recommendations of a majority of the disinterested directors of the Issuer or (b) in the same proportions (including abstentions) as the holders of record of the Issuer's Voting Securities, other than those beneficially owned by the Stockholders, vote their securities; provided that the Stockholders may vote in favor of the election or retention of the one or two directors designated by Samstock as described in the preceding paragraph. Pursuant to the Investment Agreement and subject to certain exceptions, the Issuer granted to the Stockholders and certain other parties certain shelf registration rights in connection with certain permitted sales of shares of Common Stock. In particular, pursuant to such registration rights, the Issuer has prepared and filed with the SEC a shelf registration statement (including pledgees of any selling stockholder) with respect to all Shares and Warrant Shares and caused such shelf registration statement to become effective and has agreed to use its reasonable efforts keep such registration statement effective until such time as all Shares and Warrant Shares have been sold or otherwise disposed of. The purpose of such shelf registration is to facilitate the ability of each of TMI, Samstock and their affiliates to margin its stock and does not represent any present intention on behalf of any Stockholder to dispose of any Shares or Warrant Shares covered thereby. Pursuant to the Investment Agreement and subject to certain exceptions, the Issuer granted to Samstock and certain other parties certain shelf registration rights in connection with certain permitted sales of shares of Series A Preferred Stock and Common Stock. In particular, the Issuer agreed to prepare and file with the SEC a shelf registration statement (which shall include pledgees of any selling stockholder) with respect to the Series A Preferred Stock, Common Stock issuable upon conversion of the Series A Preferred Stock and the Rights Offering Warrant Shares as soon as practicable after the Rights Offering Closing, and to use its reasonable efforts to cause such shelf registration statement to become effective and keep such registration statement effective until such time as all Series A Preferred Stock, Common Stock issuable upon conversion of the Series A Preferred Stock or the Rights Offering Warrant Shares have been sold or otherwise disposed of. The purpose of any such shelf registration put in effect pursuant to the Investment Agreement is to facilitate the ability of Samstock and its affiliates to margin its stock and does not represent any present intention on behalf of any Stockholder to dispose of any Series A Preferred Stock, Common Stock issuable upon conversion of the Series A Preferred Stock or the Rights Offering Warrant Shares to be covered thereby. The summary contained in this Statement of certain provisions of the Investment Agreement is not intended to be complete and is qualified in its entirety by reference to the First Amended Investment Agreement and the Second Amended 10 11 Investment Agreement attached as exhibits to Amendment Number 1 to Schedule 13D or Amendment Number 2 to Schedule 13D and incorporated herein by reference. Samstock entered into a Co-Sale and Voting Agreement (the "New Investors Co-Sale Agreement") dated as of April 28, 2000, with the Issuer, Minotaur Partners II, L.P., an Illinois limited partnership ("MP II"), ValueVision International Inc., a Minnesota corporation ("ValueVision"), Dominic Mangone ("Mangone"), and Raymond Bank ("Bank" and, together with MP II, ValueVision and Mangone, the "New Investors"). The New Investors Co-Sale Agreement was entered into in connection with the acquisition on May 1, 2000 by the New Investors of (i) 904,303 newly issued shares of Common Stock (the "First Tranche Shares") and (ii) warrants to purchase 1,808,606 shares of Common Stock (the "First Tranche Warrants"). The New Investors have also agreed to acquire (i) 629,944 newly issued shares of Common Stock (the "Second Tranche Shares") and (ii) warrants to purchase an additional 1,259,888 shares of Common Stock (the "Second Tranche Warrants"), subject to certain conditions. Pursuant to a Stock Purchase and Sale Agreement dated as of April 28, 2000 (the "Management Stock Purchase Agreement") among the Issuer, certain investors including Issuer management listed on the signature page of the Management Stock Purchase Agreement (the "Management Investors"), and Samstock, Samstock agreed to purchase, at the time of the closing of the purchase of the Second Tranche Shares and Second Tranche Warrants,(i) 657,536 newly issued shares of Common Stock (the "Management Shares") at a price of $4.5625 per share and (ii) warrants (the "Management Warrant Shares") to purchase an additional 1,315,072 shares of Common Stock. The Management Stock Purchase Agreement is attached hereto as Exhibit 11 and is incorporated herein by reference. The form of warrant to purchase the Management Warrant Shares is attached as Exhibit A to the Management Stock Purchase Agreement that is attached hereto as Exhibit 11 and is incorporated herein by reference. Samstock's source of funds for the aggregate $1,850,000 purchase price for the Management Shares and the Management Warrant Shares will be working capital. Samstock also entered into a Co-Sale and Voting Agreement (the "Management Investors Co-Sale Agreement") dated as of April 28, 2000 with the Issuer and the Management Investors. The New Investors Co-Sale Agreement provides that, subject to the prior rights of the Stockholders pursuant to the Amended Agreement Among Stockholders and the Stockholders Agreement, the New Investors have a right of first refusal on all sales to a third party of the stock held by Samstock where the amount of shares is equal to or exceeds more than ten percent (10%) of the shares held by Samstock. Furthermore, the New Investors' shares are subject to "drag along" provisions if Samstock sells all of its shares provided, however, that prior to the first anniversary of the New Investors Co-Sale Agreement, Samstock cannot require the New Investors to sell their shares pursuant to this provision if the contemplated transaction would result in an internal rate of return for the New Investors on their initial investment of less than 25%. Further, so long as Samstock is entitled to designate one or two directors of the Issuer pursuant to the Investment Agreement, each New Investor shall vote in favor of the election of Samstock's designee or designees to the Company's Board of Directors. In addition, so long as MP II is entitled to designate one director in accordance with the investment agreement dated as of April 28, 2000 among the Issuer and the New Investors, Samstock shall vote in favor of the election of MP II's designee to the Issuer's Board of Directors.. In the New Investors Co-Sale Agreement, Samstock also agrees to vote in favor of the proposal to be included in the Issuer's proxy statement to authorize the issuance and sale of the Second Tranche Shares and Second Tranche Warrants. The New Investors Co-Sale Agreement will terminate if the New Investors cease to own in the aggregate at least 5% of the Issuer's Voting Securities. The New Investors Co-Sale Agreement is attached hereto as Exhibit 12 and is incorporated herein by reference. The Management Investors Co-Sale Agreement provides that, subject to the prior rights of the Stockholders pursuant to the Amended Agreement Among Stockholders and the Stockholders Agreement and of the New Investors pursuant to the New Investors Co-Sale Agreement, the Management Investors have a right of first refusal on all sales to a third party of the stock held by Samstock where the amount of shares is equal to or exceeds more than ten percent (10%) of the shares held by Samstock. Furthermore, the Management Investors' shares are subject to "drag along" provisions if Samstock sells all of its shares provided, however, that prior to the first anniversary of the Management Investors Co-Sale Agreement, Samstock cannot require the Management Investors to sell their shares pursuant to this provision if the contemplated transaction would result 11 12 in an internal rate of return for the Management Investors on their initial investment of less than 25%. In the Management Investors Co-Sale Agreement, Samstock also agrees to vote in favor of the proposal to be included in the Issuer's proxy statement to authorize the issuance and sale of the Second Tranche Shares and Second Tranche Warrants. The Management Investors Co-Sale Agreement will terminate if the Management Investors cease to own in the aggregate at least 5% of the Issuer's Voting Securities. The Management Investors Co-Sale Agreement is attached hereto as Exhibit 13 and is incorporated herein by reference. The summary contained in this Statement of certain provisions of the Management Stock Purchase Agreement, the New Investors Co-Sale Agreement and the Management Investors Co-Sale Agreement is not intended to be complete and is qualified in its entirety by reference to the Management Stock Purchase Agreement, the New Investors Co-Sale Agreement and the Management Investors Co-Sale Agreement each attached as an Exhibit hereto and incorporated herein by reference. ITEM 4. Purpose of the Transaction The Stockholders' acquisition of the Shares, the Warrant Shares and the Preferred Shares, Samstock's acquisition of 135,000 of the Chasen Shares, Samstock's acquisition of the Rights Offering Warrant, and Samtock's acquisition of the Management Shares and the Management Warrant Shares, and Samstock's acquisition of the sole power to vote or to direct the vote of the Chasen Shares and the Halmostock Shares, were effected for the purpose of investing in the Issuer. The purchase price upon exercise of the warrants in respect of the Warrant Shares is equal to a specified price (the "Exercise Price") multiplied by the number of shares of Common Stock that TMI, Samstock, or Halmostock, as the case may be, is then purchasing upon exercise of the warrants. The Exercise Price is $6.00 per share for one third of the Warrant Shares purchased, $7.00 per share for another third of the Warrant Shares, and $8.00 per share for the final third of the Warrant Shares. The warrants may be exercised at any time and will expire on the fifth anniversary of the date of the Initial Investment Closing Date. The purchase price upon exercise of the Rights Offering Warrant in respect of the Rights Offering Warrant Shares is equal to $2.4813 per share (which exercise price is equal to the average of the closing prices of the common stock for the 20 trading days preceding the Rights Offering Closing). The Rights Offering Warrant may be exercised at any time and will expire on the fifth anniversary of the date of the Rights Offering Closing. The purchase price upon exercise of the warrants in respect of the Management Warrant Shares is equal to a specified price (the "Management Warrant Exercise Price") multiplied by the number of shares of Common Stock that Samstock is then purchasing upon the exercise of the warrants. The Management Warrant Exercise Price is $5.93125 per share for one-half of the Management Warrant Shares purchased and $7.30 per share for the other one-half of the Management Warrant Shares purchased. The warrants may be exercised at any time and will expire on the fifth anniversary of their issuance date. Each Stockholder intends to continue to review its investment in Common Stock and Series A Preferred Stock and, subject to the limitations of the Investment Agreement, the New Investors Co-Sale Agreement and the Management Investors Co-Sale Agreement described above, from time to time depending upon certain factors, including without limitation the financial performance of the Issuer, the availability and price of shares of Common Stock and Series A Preferred Stock and other general market and investment conditions, may determine to acquire through open market purchases or otherwise additional shares of Common Stock or Series A Preferred Stock, or may determine to sell through the open market or otherwise. Except as stated above, none of the Stockholders has any plans or proposals of the types referred to in clauses (a) through (j) of Item 4 of Schedule 13D, as promulgated by the Securities and Exchange Commission. 12 13 ITEM 5. Interest in Securities of the Issuer (a) and (b) To the best knowledge of the Stockholders, there are 14,536,382 shares of Common Stock outstanding as of May 1, 2000, including the First Tranche Shares. As of May 1, 2000, the aggregate 3,204,663 shares of Common Stock beneficially owned by the Stockholders represent approximately 22.0% of the Common Stock issued and outstanding, and, together with the 3,046,693 Preferred Shares, the 1,071,276 Warrant Shares, the 1,000,000 Rights Offering Warrant Shares and the 810,959 Management Warrant Shares, represent 42.3% of the Common Stock, including the Warrant Shares, the Preferred Shares, the Rights Offering Warrant Shares, and the Management Warrants on a fully converted and exercised basis. Such securities are held as follows:
ISSUED AND PREFERRED RIGHTS OFFERING HOLDER OUTSTANDING SHARES SHARES WARRANT SHARES WARRANT SHARES - ------------------------------------- -------------------- ---------------- --------------- --------------- Samstock............................. 2,020,519 2,840,489 905,049 1,000,000 Halmostock........................... 438,305 206,204 166,227 0 Chasens (1).......................... 745,838 0 0 0 -------------------- ---------------- --------------- --------------- Total................................ 3,204,663 3,046,693 1,071,276 1,000,000 ==================== ================ =============== ===============
(1) As described in Item 3 above and as set forth more fully in this Item 5, Samstock has shared voting power and shared dispositive power in respect of the Chasen Shares. Because Samstock is a party with the New Investors in the Co-Sale Agreement the Stockholders may, pursuant to Rule 13d-3, be deemed to be in a "group" with the New Investors, and therefore to jointly beneficially own 2,712,909 shares of the Issuer held by the New Investors as of May 1, 2000. Assuming the closing of the purchase of all of the Second Tranche Shares and the Second Tranche Warrants, the closing of all of the purchases under the Management Stock Purchase Agreement and no other issuances of Common Stock, there will be 15,823,860 shares of Common Stock outstanding, the Stockholders will beneficially own 3,610,142 shares of Common Stock representing 22.8% of the of the Common Stock issued and outstanding, and together with the 3,046,693 Preferred Shares, the 1,071,276 Warrant Shares, the 1,000,000 Rights Offering Warrant Shares and the 810,959 Management Warrant Shares, will represent 46.6% of the Common Stock, including the Warrant Shares, the Preferred Shares, the Rights Offering Warrant Shares, and the Management Warrant Shares. Pursuant to the Amended Agreement Among Stockholders, and subject to the limitations of the Investment Agreement, Samstock has the shared power to vote or to direct the vote of the 745,839 Chasen Shares beneficially owned by it. Pursuant to the Stockholders Agreement, and subject to the limitations of the Investment Agreement, Samstock has the shared power to vote or to direct the vote of the 810,736 Halmostock Shares beneficially owned by it. In addition, each of the Stockholders has agreed to vote its shares of Common Stock and Series A Preferred Stock in accordance with certain provisions of the Investment Agreement. Each Stockholder has the power to dispose of or to direct the disposition of such Stockholder's shares of Common Stock and/or Series A Preferred Stock, subject to the following limitations, which are described more fully in Item 3 above. Pursuant to the "drag along" provisions of the Amended Agreement Among Stockholders, Samstock has the shared power, together with the Chasens, to dispose of or to direct the disposition of the Chasen Shares. Similarly, pursuant to the "drag along" provisions of the Stockholders Agreement, Samstock has the shared power, together with Halmostock, to dispose of or to direct the disposition of the Halmostock Shares. For purposes of this Statement the Stockholders are being treated as a group which, in the aggregate, beneficially owns all of the shares of Common Stock and Series A Preferred Stock listed above. This filing shall not be construed as an 13 14 admission that any reporting person is the beneficial owner of all of such shares of Common Stock or Series A Preferred Stock. At the date hereof, neither the Stockholders, nor to the best knowledge of the Stockholders, any of SZI, ZGP, HIW or any of the persons listed in Appendix A hereto owns any shares of Common Stock or Series A Preferred Stock other than shares of Common Stock and Series A Preferred Stock beneficially owned by the Stockholders, as described herein, of which one or more of such other persons may be deemed to have beneficial ownership pursuant to Rule 13d-3 of the Exchange Act. (c) Since the date of the filing of Amendment No. 3 to the Schedule 13D, the following transactions have occurred: On February 28, 2000, the Chasens sold 94,170 shares of Common Stock. (d) No person other than a Stockholder has the right to receive or the power to direct the receipt of dividends from, or the proceeds from the sale of the Common Stock beneficially owned by such Stockholders, except for the Chasens, in the case of the Chasen Shares. (e) Not applicable. ITEM 7. Material to be Filed as Exhibits Exhibit 1 - Stock Purchase Agreement* Exhibit 2 - Assignment Agreement* Exhibit 3 - Amended Agreement Among Stockholders* Exhibit 4 - Stockholders Agreement* Exhibit 5 - First Amended Investment Agreement* Exhibit 6 - GAMI Loan Agreement* Exhibit 7 - Standby Purchase Agreement* Exhibit 8 - Second Amended Investment Agreement* Exhibit 9 - Power of Attorney dated February 26, 1998* Exhibit 10 - Rights Offering Warrant* Exhibit 11 2000 Stock Purchase Agreement** Exhibit 12 New Investors Co-Sale Agreement** Exhibit 13 Management Investors Co-Sale Agreement** Exhibit 14 Press Release dated May 2, 2000** * Previously filed. ** Filed herewith. APPENDIX A SCHEDULE 13D/A CUSIP NUMBER 893767103 SZ Investments, L.L.C., A Delaware Limited Liability Company: SZI's managing member is Zell General Partnership, Inc., and its non-managing members are Alphabet Partners and ZFT Partnership. Zell General Partnership, Inc., An Illinois Corporation: ZGP's sole shareholder is the Samuel Zell Revocable Trust and its sole director is Samuel Zell. Samuel Zell: Mr. Zell is Chairman of the Board of Directors of Equity Group Investments, L.L.C. ("EGI"). EGI is a privately owned investment management firm. Mr. Zell is a citizen of the United States of America. 14 15 Alphabet Partners, An Illinois General Partnership: Alphabet Partners is composed of three trusts created for the benefit of Mr. Zell and his family. Chai Trust Company, L.L.C., an Illinois limited liability company, is the sole trustee of the three trusts. ZFT Partnership, An Illinois General Partnership: ZFT Partnership is composed of four trusts created for the benefit of Mr. Zell and his family. Chai Trust Company, L.L.C., an Illinois limited liability company, is the sole trustee of the four trusts. Halmos Investments-Western, Inc.: HIW's sole shareholder and sole director is Steven J. Halmos. Mr. Halmos is a citizen of the United States of America. 15 16 SIGNATURE After reasonable inquiry and to the best of the undersigned's knowledge and belief, the undersigned certify that the information set forth in this statement is true, complete and correct. DATED: May 5, 2000 SAMSTOCK, L.L.C. By: /s/ DONALD J. LIEBENTRITT ------------------------------------- Name: Donald J. Liebentritt Title: Vice President HALMOSTOCK LIMITED PARTNERSHIP by Halmos Investments-Western, Inc., its general partner By: /s/ * ------------------------------------- Name: Steven J. Halmos, President * By: /s/ DONALD J. LIEBENTRITT ----------------------------------- Donald J. Liebentritt Attorney-in-fact 16 17 EXHIBIT INDEX
EXHIBIT NUMBER DESCRIPTION - ------- ----------- 1 Stock Purchase and Sale Agreement dated as of November 6, 1997* 2 Assignment Agreement dated as of March 3, 1998* 3 Amended and Restated Agreement Among Stockholders dated as of March 3, 1998* 4 Stockholders' Agreement dated as of March 3, 1998* 5 First Amended Investment Agreement dated as of March 3, 1998* 6 GAMI Loan Agreement dated as of June 30, 1999* 7 Standby Purchase Agreement dated as of June 30, 1999* 8 Second Amended Investment Agreement dated as of June 30, 1999* 9 Power of Attorney dated February 26, 1998* 10 Stock Purchase and Sale Agreement dated as of April 28, 2000** 11 Co-Sale and Voting Agreement dated as of April 28, 2000 (New Investors)** 12 Co-Sale and Voting Agreement dated as of April 28, 2000 (Management Investors)** 13 Press Release dated May 2, 2000**
* Previously filed. ** Filed herewith. 17 EX-99.10 2 STOCK PURCHASE AND SALE AGREEMENT 1 EXHIBIT 10 STOCK PURCHASE AND SALE AGREEMENT STOCK PURCHASE AND SALE AGREEMENT, dated as of April 28, 2000 (as amended, supplemented or otherwise modified from time to time, this "Agreement"), among each of the purchasers listed on the signature pages hereto (collectively, the "Purchasers"), and Transmedia Network Inc., a Delaware corporation (the "Company"). All capitalized terms used and not otherwise defined herein have the meanings ascribed to them in Article IX hereof. WHEREAS, the Company desires to issue and sell to the Purchasers, and the Purchasers desire to purchase from the Company, (i) 657,536 newly issued shares of Common Stock in the aggregate (such 657,536 newly issued shares, collectively the "Shares") at a price of $4.5625 per share (the "Share Purchase Price") and (ii) warrants (the "Warrants") in the form of Exhibit A hereto to purchase an additional 1,315,072 shares of Common Stock in the aggregate (such additional 1,315,072 shares of Common Stock in the aggregate issuable from time to time upon the exercise of the Warrants, collectively the "Warrant Shares"). NOW, THEREFORE, in consideration of the premises, representations and warranties and the mutual covenants and agreements set forth herein and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereby agree as follows: ARTICLE I PURCHASE AND SALE OF SHARES AND WARRANTS 1.1 Purchase and Sale of the Shares and Warrants. Upon the terms and subject to the satisfaction of the conditions contained in this Agreement, at the Closing, the Company shall issue and sell to the Purchasers (in such proportions as between the Purchasers as set forth on Schedule 1 hereto), and the Purchasers shall so purchase from the Company, the Shares and the Warrants, in each case free and clear of all Liens. 1.2 Consideration. Upon the terms and subject to the satisfaction of the conditions contained in this Agreement, the Purchasers shall pay to the Company (in such proportions as between the Purchasers as set forth on Schedule 1 hereto) $3,000,000 in the aggregate (the "Purchase Price") for the Shares and the Warrants. ARTICLE II THE CLOSING 2.1 Time and Place. Upon the terms and subject to the satisfaction of the conditions contained in this Agreement, including but not limited to the Stockholder Approval and the approval by the Disinterested Directors of the Company of the purchase by Samstock of the Shares and Warrants pursuant to this Agreement, the closing of the issuance and sale of the Shares and the Warrants contemplated by this Agreement (the "Closing") shall take place at the 2 offices of Transmedia Network Inc., 11900 Biscayne Boulevard, Miami, Florida, at 10:00 a.m. (local time) within ten business days of the Company receiving the Stockholder Approval and concurrently with the Second Closing, or at such other place or time as the Purchasers and the Company may agree, but in no event at any time prior to the receipt of the Stockholder Approval. The date and time at which the Closing actually occurs is hereinafter referred to as the "Closing Date." 2.2 Deliveries by the Company. At the Closing, the Company shall deliver the following to the Purchasers: (i) a certificate of the Secretary or any Assistant Secretary of the Company certifying as to the receipt by the Company of the Stockholder Approval; (ii) stock certificates representing the Shares, in the names of each of the Purchasers, dated as of the Closing Date, in the respective denominations set forth on Schedule 1 hereto; (iii) the Warrants, dated as of the Closing Date, in the names of each of the Purchasers, dated as of the Closing Date, in the respective denominations set forth on Schedule 1 hereto; and (iv) all other documents, instruments and writings required to be delivered by the Company at or prior to the Closing Date pursuant to this Agreement. 2.3 Deliveries by the Purchasers. At the Closing, the Purchasers shall deliver the following to the Company: (i) the Purchase Price by wire transfer of immediately available funds to such accounts designated in a writing delivered by the Company to the Purchasers no less than two (2) business days prior to the Closing Date or by such other means as may be agreed upon in writing by the Company and the Purchasers; and (ii) all other documents, instruments and writings required to be delivered by the Purchasers at or prior to the Closing Date pursuant to this Agreement. ARTICLE III REPRESENTATIONS AND WARRANTIES OF THE COMPANY The Company represents, warrants and covenants to the Purchasers on the date of this Agreement, which representations, warranties and covenants shall survive the Closing to the extent hereinafter provided, that (except as set forth in the Company's schedules delivered herewith): -2- 3 3.1 Organization and Qualification. Each of the Company and each Subsidiary is a corporation duly organized, validly existing and in good standing under the laws of the jurisdiction of its incorporation and has the requisite corporate power and authority to carry on its business as it is now being conducted. Each of the Company and each Subsidiary is duly qualified or licensed as a foreign corporation to do business, and is in good standing, in each jurisdiction (including any foreign country) where the character of its properties owned, leased or operated by it or the nature of its activities makes such qualification or licensing necessary, except for such failures to be so qualified or licensed or in good standing which would not, individually or in the aggregate, have a Material Adverse Effect. 3.2 Certificate of Incorporation and Bylaws. The Company has heretofore made available to the Purchasers a complete and correct copy of the certificates of incorporation of the Company and iDine and the bylaws of the Company and iDine as currently in effect (collectively, the "Organizational Documents"). Such Organizational Documents are in full force and effect, and no other organizational documents are applicable to or binding upon the Company or any Subsidiary (including, without limitation, any joint venture, investment or other agreement). Neither the Company nor iDine is in violation of any of the provisions of its Organizational Documents. 3.3 Capitalization; Subsidiaries. (a) The authorized capital stock of the Company consists of 70,000,000 shares of Common Stock and 10,000,000 shares of Preferred Stock. As of March 31, 2000, (i) 13,632,709 shares of Common Stock were issued and outstanding, (ii) 4,149,378 shares of Series A Preferred Stock were issued and outstanding and (iii) no shares of Common Stock or Preferred Stock were held in the treasury of the Company. (b) The Shares and the Warrants shall represent approximately 8.10% of the Fully Diluted Common Stock and 14.47% of the outstanding shares of Common Stock as of the Closing Date. (c) Except as set forth above in Section 3.3(a) and as set forth in Schedule 3.3(c) hereto, and except with respect to any Equity Securities issued by the Company in the ordinary course of business, there were as of March 31, 2000 no outstanding Equity Securities of the Company. Schedule 3.3(c) includes a true and correct table summarizing all outstanding stock options, warrants and other rights to acquire Equity Securities of the Company or any Subsidiary, including the identity and title of the holder (other than the holders of the Series A Preferred Stock), the number of shares covered, the vesting schedule therefor, the exercise price therefor, and the termination date therefor. (d) Each of the outstanding shares of capital stock of each Subsidiary is duly authorized, validly issued, fully paid and nonassessable, and all such shares are owned by the Company free and clear of all Liens, and there are no outstanding Equity Securities of any Subsidiary other than such shares. Except as set forth on Schedule 3.3(d) hereto, the Company does not own, directly or indirectly, any capital stock or other equity interest in any Person other than the Subsidiaries. -3- 4 3.4 The Shares and the Warrants. Upon payment of the Purchase Price, the Purchasers will acquire good and marketable title to the Shares and the Warrants, free and clear of all Liens, and such Shares shall be validly issued, fully paid and nonassessable. Upon exercise of the Warrants, in whole or, from time to time, in part, and upon payment of the exercise price therefor, in accordance with the terms of the Warrants, the Purchasers will acquire good and marketable title to the Warrant Shares, free and clear of all Liens, and such Warrant Shares shall be validly issued, fully paid and nonassessable. 3.5 Power and Authority. The Company has all necessary corporate power and authority to execute and deliver this Agreement, the Co-Sale and Voting Agreement, the Investment Agreement, the Warrants and all other documents, instruments and other writings to be executed and/or delivered by or on behalf of the Company to the Purchasers or any of their representatives in connection with the transactions contemplated hereby or thereby (collectively, the "Company Transaction Documents"), to perform its obligations hereunder and thereunder and to consummate the transactions contemplated hereby and thereby. The execution, delivery and performance of each of the Company Transaction Documents by the Company, and the consummation by the Company of the transactions contemplated hereby and thereby, have been duly and validly authorized by the Board of Directors of the Company (the "Board") and by a majority of the Disinterested Directors of the Company, and no other corporate proceedings on the part of the Company are necessary to authorize the execution, delivery and performance of the Company Transaction Documents or the consummation of the transactions contemplated hereby and thereby, other than the Stockholder Approval. The Board has approved each of the Company Transaction Documents and the transactions contemplated hereby and thereby so as to render inapplicable to such transactions, including, without limitation, the issuance to the Purchasers of the Shares, the Warrants and Warrant Shares, the restrictions contained in Article Seventh of the Certificate of Incorporation of the Company and the restrictions contained in Section 203 of the Delaware General Corporation Law. Each of the Company Transaction Documents has been duly and validly executed and delivered by the Company and, assuming the due authorization, execution and delivery hereof and thereof by the Purchasers, each constitutes a legal, valid and binding obligation of the Company enforceable against the Company in accordance with its terms. 3.6 No Conflict; Required Filings and Consents. The execution, delivery and performance of the Company Transaction Documents by the Company do not and will not: (a) conflict with or violate the Organizational Documents of the Company or any Subsidiary; (b) conflict with or violate any law, rule, regulation, order, judgment or decree applicable to the Company or any Subsidiary or by which its or any of their respective properties are bound or affected; (c) require any consent, approval, authorization or permit of, action by, filing with or notification to, any Governmental Entity (other than any filing required under Section 13(a) or (d), 14, 15(d) or 16(a) of the Exchange Act); or (d) result in any breach or violation of or constitute a default (or an event which with notice or lapse of time or both could become a default) or result in the loss by the Company or any Subsidiary of a material benefit under, or give rise to any right of termination, amendment, acceleration or cancellation of, or result in the creation of a Lien on any of the properties or assets of the Company or any Subsidiary pursuant to, any Contract, Permit or other instrument or obligation to which the Company or any Subsidiary is a party or by which the Company or any Subsidiary or any of their respective properties are bound or affected; other than (i) in the case of clauses (b) and (d) for such conflicts, -4- 5 violations, breaches, defaults, rights, losses and Liens as, and (ii) in the case of clause (c), such consents, approvals, authorizations, permits, actions, filings and notifications, the absence of which, would not have a Material Adverse Effect. 3.7 Employment, Consulting and Severance Agreements and Related Matters. Except as set forth in Schedule 3.7 hereto: (a) There are no Employment, Consulting or Severance Agreements with respect to iDine to which the Company or iDine is a party or by which the Company or iDine or any of their respective assets may be bound, and no present or former employee, officer, director, consultant, independent contractor or other agent of the Company or iDine is a party to or the beneficiary of any such Employment, Consulting or Severance Agreements; and (b) The execution and delivery of this Agreement or the other Company Transaction Documents and the consummation of the transactions contemplated hereby and thereby: (i) do not and will not result in any breach or violation of or constitute a default (or an event which with notice or lapse of time or both could become a default) or result in the loss by the Company or any Subsidiary of a material benefit under, or give rise to any right of termination, amendment, acceleration or cancellation of any Employment, Consulting or Severance Agreement; or (ii) do not and will not give rise to any obligation on the part of the Company or any Subsidiary to pay or provide any Severance Payment. 3.8 Compliance; No Violation. Each of the Company and each Subsidiary is in compliance with, and is not in default or violation of, (i) its respective Organizational Documents and (ii) all Contracts, Permits and other instruments or obligations to which any of them are a party or by which any of them or any of their respective properties may be bound or affected, except, in the case of clause (ii), for any such failures of compliance, defaults and violations which could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect. Since January 1, 2000, neither the Company nor any Subsidiary has received notice of any revocation or modification of any federal, state, local or foreign Permit material to the Company and its subsidiaries taken as a whole. 3.9 SEC Documents; Undisclosed Liabilities. (a) Since September 30, 1998, the Company has filed all required reports, schedules, forms, proxy, registration and other statements and other documents with the SEC (collectively, the "SEC Documents"). As of the date of this Agreement, the last SEC Document filed by the Company was its Quarterly Report on Form 10-Q for the quarter ended December 31, 1999. As of their respective filing dates, the SEC Documents complied in all material respects with the requirements of the Securities Act or the Exchange Act, as the case may be, and the rules and regulations of the SEC promulgated thereunder applicable to the SEC Documents. As of their respective filing dates, none of the SEC Documents contained any untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading, except to the extent such statements have been modified or superseded by a later SEC Document filed and publicly available prior to the Closing Date, the circumstances or bases for which -5- 6 modifications or supersessions have not and will not individually or in the aggregate result in any material liability or obligation on behalf of the Company under the Securities Act, the Exchange Act, the rules promulgated under the Securities Act or the Exchange Act, or any federal, state or local anti-fraud, blue-sky, securities or similar laws. The consolidated financial statements of the Company included in the SEC Documents (as amended or supplemented by any later filed SEC Document filed and publicly available prior to January 1, 2000), comply as to form in all material respects with applicable accounting requirements and the rules and regulations of the SEC with respect thereto, have been prepared in accordance with generally accepted accounting principles (except, in the case of unaudited statements, as permitted by Form 10-Q of the SEC) applied on a consistent basis during the periods involved (except as may be indicated in notes thereto) and fairly present the consolidated financial position of the Company and the Subsidiaries as of the dates thereof and the consolidated results of their operations and cash flows for the periods then ended (subject, in the case of unaudited statements, to normal year-end audit adjustments). Except as set forth in the SEC Documents, neither the Company nor any Subsidiary has any obligation or liability of any nature whatsoever (direct or indirect, matured or unmatured, absolute, accrued, contingent or otherwise) either (i) required by generally accepted accounting principles to be set forth on a consolidated balance sheet of the Company and the Subsidiaries or in the notes thereto or (ii) which, individually or in the aggregate, could reasonably be expected to have a Material Adverse Effect whether or not required by generally accepted accounting principles to be provided or reserved against on a balance sheet prepared in accordance with generally accepted accounting principles; other than liabilities and obligations reflected or reserved against in the consolidated financial statements of the Company and its consolidated subsidiaries included in the Company's quarterly report on Form 10-Q for the quarter ended December 31, 1999, or incurred since the date of the balance sheet included in such financial statements in the ordinary course of business which are not individually or collectively material to the Company and the Subsidiaries taken as a whole. (b) At the date the Proxy Statement is first mailed to the Company's stockholders or at the time of the Stockholders' Meeting, the Proxy Statement will not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they are made, not misleading. The Proxy Statement shall comply in all material respects with the requirements of the Exchange Act and the rules and regulations promulgated thereunder except that the Company makes no representation, warranty or covenant with respect to any written information supplied by the Purchasers specifically for inclusion in the Proxy Statement. 3.10 Absence of Certain Changes or Events. Except as disclosed in the SEC Documents, since January 1, 2000, the Company and the Subsidiaries have conducted their businesses only in the ordinary course and in a manner consistent with past practice, and there has not occurred any event, condition, circumstance, change or development (whether or not in the ordinary course of business) that, individually or in the aggregate, has had or could reasonably be expected to have a Material Adverse Effect. Without limiting the generality of the foregoing, except as set forth on Schedule 3.10 hereto or as disclosed in any SEC Documents filed with the SEC and publicly available prior to January 1, 2000, since January 1, 2000, there has not been (i) any change by the Company in its accounting methods, principles or practices, (ii) any revaluation by the Company of any of its or any Subsidiary's material assets, including but not limited to, -6- 7 writing down the value of any Rights to Receive other than in the ordinary course of business consistent with past practice, (iii) any entry outside the ordinary course of business by the Company or any Subsidiary into any commitments or transactions material, individually or in the aggregate, to the Company and the Subsidiaries taken as a whole, (iv) any declaration, setting aside or payment of any dividends or distributions in respect of the shares of Common Stock or, any redemption, purchase or other acquisition of any of its securities, other than semi-annual cash dividends of $.02 per share on outstanding Common Stock consistent with past practices, (v) any grant or issuance of any Equity Securities of the Company or any Subsidiary; or (vi) any increase in, establishment of or amendment of any Employment, Consulting or Severance Agreement, bonus, insurance, deferred compensation, pension, retirement, profit sharing, stock option (including without limitation the granting of stock options, stock appreciation rights, performance awards, or restricted stock awards), stock purchase or other employee benefit plan or agreement or arrangement, or any other increase in the compensation payable or to become payable to any present or former directors, officers or employees of the Company or any Subsidiary, except for increases in compensation in the ordinary course of business consistent with past practice. 3.11 Absence of Litigation; Compliance. Except as set forth on Schedule 3.11 hereto or as disclosed in any SEC Documents filed with the SEC and publicly available prior to January 1, 2000, there are no suits, claims, actions, proceedings or investigations pending or, to the Company's knowledge, overtly threatened against the Company or any Subsidiary, or any properties or rights of the Company or any Subsidiary, before any arbitrator or Governmental Entity, that (i) if determined adversely to the Company or any Subsidiary could, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect or (ii) seek to delay or prevent the consummation of the transactions contemplated by this Agreement or any other Transaction Document. Neither the Company nor any Subsidiary nor any of their respective properties is or are subject to any order, writ, judgment, injunction, decree, determination or award having, or which in the future could reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect or could prevent or delay the consummation of the transactions contemplated by this Agreement or any other Transaction Document. Neither the Company nor any Subsidiary is in violation of, nor has the Company or any Subsidiary violated, any applicable provisions of any note, bond, mortgage, indenture, contract, agreement, lease, license, permit, franchise, or other instrument or obligations to which the Company or any Subsidiary is a party or by which the Company, any Subsidiary or any of their respective properties are bound or affected except for any such violations which could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect. Except as disclosed in the SEC Documents filed with the SEC and publicly available prior to January 1, 2000, the Company and its Subsidiaries are in compliance with all applicable statutes, laws, ordinances, rules, orders and regulations of any Governmental Entity (including, without limitation, with respect to employment and employment practices, immigration laws relevant to employment, and terms and conditions of employment and wages and hours) except for any failures to comply which could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect. Except as disclosed in the SEC Documents filed with the SEC and publicly available prior to January 1, 2000, no investigation by any Governmental Entity with respect to the Company or any Subsidiary is pending or threatened. -7- 8 3.12 Material Contracts; Defaults. All material Contracts (other than Employment, Consulting or Severance Agreements) to which the Company or any Subsidiary is a party or by which the Company or any Subsidiary or any of their respective assets may be bound (the "Material Contracts") have been filed with or described in the Company's SEC Documents. Neither the Company nor any Subsidiary is, or has received any notice or has any knowledge that any other party is, in default in any respect under any Material Contract, except for those defaults which would not, either individually or in the aggregate, reasonably be expected to have a Material Adverse Effect, and there has not occurred any event that with the lapse of time or the giving of notice or both would constitute such a default by the Company or any Subsidiary or, to the Company's knowledge, by any other party. To the Company's knowledge, no party to any Material Contract has threatened to terminate such Material Contract (or modify such Material Contract in a manner detrimental to the Company or any Subsidiary). 3.13 Intellectual Property. The Company and each of its Subsidiaries owns, or is licensed to use (in each case, free and clear of any Liens) all patents, trademarks, trade names, copyrights, technology, know-how, trade secrets, processes and computer software (including, without limitation, all documentation and source and object codes with respect to such software) used in or necessary for the conduct of its business as currently conducted which are material to the business, operations, assets, prospects, financial condition or results of operations of the Company and its Subsidiaries taken as a whole. To the Company's knowledge, the use of such patents, trademarks, trade names, copyrights, technology, know-how, trade secrets, processes and computer software (including, without limitation, all documentation and source and object codes with respect to such software) by the Company and its Subsidiaries does not infringe or otherwise violate the rights of any person. To the Company's knowledge, no person is infringing any right of the Company or any Subsidiary with respect to any such patents, trademarks, trade names, copyrights, technology, know-how, processes or computer software (including, without limitation, all documentation and source and object codes with respect to such software). 3.14 Vote Required. The affirmative vote of the holders of no more than a majority of the outstanding shares of Common Stock and the Series A Preferred Stock, voting together as a class, is the only vote of the holders of any class or series of capital stock or other Equity Securities of the Company necessary to approve the issuance and sale of the Shares and the Warrants. 3.15 Takeover Status. No "fair price", "moratorium", "control share acquisition" or other similar anti-takeover statute or regulation enacted under state or federal laws or applicable stock exchange rules or regulations, including, without limitation, Section 203 of the Delaware General Corporation Law, applicable to the Company or any Subsidiary is applicable to the transactions contemplated hereby or by any other Transaction Document, taken individually or in the aggregate. 3.16 Compliance with Securities Laws. The Company has not taken, and will not take, any action which would subject the issuance and sale of the Shares, the Warrants and/or the Warrant Shares pursuant to this Agreement to the provisions of Section 5 of the Securities Act, or violate the registration or qualification provisions of any securities or blue sky laws of any applicable jurisdiction, and, based in part on the representations of the Purchasers in Section 4.5, -8- 9 the sale of the Shares and the Warrants pursuant to this Agreement and the issuance of the Warrant Shares from time to time upon exercise of the Warrants complies with all applicable requirements of applicable federal and state securities and blue sky laws. 3.17 Brokers. No broker, finder, investment banker or other person is entitled to receive from the Purchasers any brokerage, finder's or other fee or commission in connection with the transactions contemplated by the Company Transaction Documents based upon arrangements made by or on behalf of the Company. ARTICLE IV REPRESENTATIONS AND WARRANTIES OF THE PURCHASERS Each of the Purchasers hereby severally, but not jointly, represents, warrants and covenants to the Company, with respect to itself, himself or herself, on the date of this Agreement and again on the Closing Date, which representations and warranties shall survive the Closing, as follows: 4.1 Organization. Each Purchaser, as applicable, is duly organized, validly existing and in good standing under the laws of the jurisdiction in which it is organized. 4.2 Authority Relative to This Agreement, etc. Each Purchaser, as applicable, has the requisite power and authority to execute and deliver this Agreement, the Investment Agreement, the Co-Sale and Voting Agreement and all other documents, instruments and other writings to be executed and/or delivered by or on behalf of such Purchaser to the Company or any of its representatives in connection with the transactions contemplated hereby or thereby (collectively, "Purchaser Transaction Documents"), to perform its, his or her obligations hereunder and thereunder and to consummate the transactions contemplated hereby and thereby. The execution, delivery and performance of each of the Purchaser Transaction Documents by such Purchaser and the consummation by such Purchaser of the transactions contemplated hereby and thereby have been duly authorized by the requisite officer, manager, partner or member of such Purchaser, and no other proceedings on the part of such Purchaser, are necessary to authorize the execution, delivery and performance of the Purchaser Transaction Documents or the transactions contemplated hereby or thereby. Each of the Purchaser Transaction Documents has been duly executed and delivered by such Purchaser, as the case may be, and, assuming due authorization, execution and delivery by the Company, constitutes a legal, valid and binding obligation of such Purchaser, as the case may be, enforceable against such Purchaser, as the case may be, in accordance with its terms. 4.3 No Conflict; Required Filings and Consents. The execution, delivery and performance of the Purchaser Transaction Documents by such Purchaser, as the case may be, does not and will not: (i) conflict with or violate the organizational documents of such Purchaser, as the case may be; (ii) conflict with or violate any law, rule, regulation, order, judgment or decree applicable to such Purchaser, as the case may be, or by which any of their properties are bound or -9- 10 affected; (iii) require any consent, approval, authorization or permit of, action by, filing with or notification to, any Governmental Entity (other than any filing required under Section 13(a) or (d), 14, 15(d) or 16(a) of the Exchange Act); or (iv) result in any breach or violation of or constitute a default (or an event which with notice or lapse of time or both could become a default) or result in the loss of a material benefit under, or give rise to any right of termination, amendment, acceleration or cancellation of, or result in the creation of a Lien on any of the property or assets of such Purchaser, as the case may be, pursuant to, any Contract, Permit or other instrument or obligation to which such Purchaser, as the case may be, is a party or by which such Purchaser, as the case may be, or any of its properties are bound or affected, except, in the case of clauses (ii), (iii) and (iv), for any such conflicts, violations, breaches, defaults or other occurrences which could not, individually or in the aggregate, reasonably be expected to impair or delay the ability of such Purchaser, as the case may be, to perform its obligations under this Agreement. 4.4 Brokers. No broker, finder, investment banker or other person is entitled to any brokerage, finder's or other fee or commission in connection with the transactions contemplated by the Purchaser Transaction Documents based upon arrangements made by or on behalf of such Purchaser. 4.5 Investment Intent. Each of the Purchasers (i) agrees that the Shares, the Warrants and the Warrant Shares have not been registered under the Securities Act or any state securities laws and may not be sold or transferred except pursuant to a registration statement or pursuant to an exemption from the Securities Act, (ii) is purchasing the Shares and the Warrants and will purchase the Warrant Shares for its own account for investment, and not with a view to, or for resale in connection with, any public distribution of the Shares, the Warrants or any Warrant Shares and (iii) agrees to include in any Schedule 13D filed with the SEC covering the Shares and the Warrant Shares a statement asserting their investment intent, such statement to be in a form that is reasonably satisfactory to the Company. 4.6 Share Ownership. Except as set forth on the Purchasers' Schedule 4.6, the Purchasers do not beneficially own any Equity Securities. 4.7 Proxy Statement. The information supplied or to be supplied by the Purchasers in writing specifically for inclusion in the Proxy Statement will not, at the date the Proxy Statement is first mailed to the Company's stockholders or at the time of the Stockholders Meeting, 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, in light of the circumstances under which they are made, not misleading. 4.8 Availability of Funds. Each Purchaser has on hand and will have on the Closing Date sufficient funds to pay the Purchase Price then payable in accordance with the terms of this Agreement and all fees and expenses incurred in connection with the transactions contemplated hereby for which each Purchaser is responsible. 4.9 The Purchasers not "Interested Stockholders". Except to the extent that they may be deemed such by virtue of this Agreement and the Co-Sale and Voting Agreement, neither the -10- 11 Purchasers, nor any of their affiliates, are an "interested stockholder" of the Company within the meaning of Section 203 of the Delaware General Corporation Law or Article 7 of the Company's Certificate of Incorporation. ARTICLE V ADDITIONAL AGREEMENTS 5.1 Access to Information. The Purchasers are entitled to continue their due diligence investigation of the Company and the Subsidiaries, including without limitation, any business, legal, financial or environmental due diligence as the Purchasers deem appropriate. The Company will permit the Purchasers and their authorized representatives, accountants, attorneys, advisors and consultants full access to the Company's and the Subsidiaries' property and all records and other data with respect to the Company, the Subsidiaries, and their respective properties, assets, operations, sales and marketing activities, and products and services, as is reasonably requested, and will provide such assistance as is reasonably requested. Upon prior notification to the Company, the Purchasers are entitled to contact and communicate with employees, participating merchants (i.e., restaurants, other vendors and credit card companies), legal advisors and accountants of the Company and the Subsidiaries. 5.2 Filings. As promptly as practicable after the date of this Agreement, the Company and the Purchasers shall make or cause to be made all filings and submissions under laws and regulations applicable to the Company and the Purchasers, if any, as may be required for the consummation of the transactions contemplated by this Agreement. The Purchasers and the Company shall coordinate and cooperate in exchanging such information and providing such reasonable assistance as may be requested by any of them in connection with the filings and submissions contemplated by this Section 5.2. 5.3 Stockholders' Meeting. The Company acting through the Board shall, in accordance with applicable law, as soon as practicable: (a) duly call, give notice of, convene and hold a special meeting of its stockholders (the "Stockholders' Meeting") for the purpose of considering and taking action upon the Proxy Proposal; (b) include in the proxy statement (the "Proxy Statement") to be distributed to the Company's stockholders in connection with the Proxy Proposal, including any amendments or supplements thereto (which Proxy Statement shall be in form and content reasonably satisfactory to the Purchasers), the recommendation of the Board that the stockholders of the Company vote in favor of the approval of the Proxy Proposal; (c) provide a reasonable opportunity for the Purchasers and their counsel to review and provide comment on the Proxy Statement prior to its filing; -11- 12 (d) use its best efforts (i) to obtain and furnish the information required to be included by it in the Proxy Statement and respond promptly to any comments made by the SEC with respect to the Proxy Statement and any preliminary version thereof and cause the Proxy Statement to be mailed to its stockholders at the earliest practicable time and (ii) to obtain the necessary approvals by its stockholders of the Proxy Proposal; and (e) cause the Proxy Statement (i) not to contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they are made, not misleading, and (ii) to comply as to form in all material respects with the applicable provisions of the Exchange Act and the rules and regulations thereunder, provided that the Company makes no covenant with respect to any written information supplied by the Purchasers specifically for inclusion in the Proxy Statement. 5.4 Agreement to Cooperate; Further Assurances. Subject to the terms and conditions of this Agreement, each of the parties hereto shall use all reasonable efforts to take, or cause to be taken, all action and to do, or cause to be done, all things necessary, proper or advisable under applicable laws and regulations to consummate and make effective the transactions contemplated by this Agreement and the other Transaction Documents, including providing information and using reasonable efforts to obtain all necessary or appropriate waivers, consents and approvals, and effecting all necessary registrations and filings. In case at any time after the Closing Date any further action is necessary or desirable to transfer any Shares, the Warrants or the Warrant Shares to the Purchasers or otherwise to carry out the purposes of this Agreement and the other Transaction Documents, the Company and the Purchasers shall execute such further documents and shall take such further action as shall be necessary or desirable to effect such transfer and to otherwise carry out the purposes of this Agreement and the other Transaction Documents, in each case to the extent not inconsistent with applicable law. 5.6 Public Announcements. Any public announcement made by or on behalf of any Purchaser or the Company prior to the termination of this Agreement pursuant to Article VII hereof concerning this Agreement, the transactions described herein or in any other Transaction Document or any other aspect of the dealings heretofore had or hereafter to be had between the Company and the Purchasers and their respective Affiliates must first be approved in writing by the other (any such approval not to be unreasonably withheld), subject to the Company's obligations under applicable law or New York Stock Exchange rules and listing requirements as a public company (but the Company shall use its best efforts to consult with the Purchasers as to all such public announcements). 5.7 Notification of Certain Matters. The Company shall promptly provide the Purchasers (or their counsel) with copies of all filings made by the Company with the SEC or any other Governmental Entity in connection with this Agreement, the other Transaction Documents and the transactions contemplated hereby and thereby. 5.8 Representations and Warranties. The Company shall give prompt notice to the Purchasers, and the Purchasers shall give prompt notice to the Company, of (a) any representation or warranty made by such party contained in this Agreement that is qualified as to materiality -12- 13 becoming untrue or inaccurate in any respect or any such representation or warranty that is not so qualified becoming untrue or inaccurate in any material respect prior to the Closing or (b) the failure by such party prior to the Closing to comply with or satisfy in any material respect any covenant, condition or agreement to be complied with or satisfied by such party under this Agreement; provided, however, that no such notification shall affect the representations, warranties, covenants or agreements of the parties or the conditions to the obligations of the parties under this Agreement. 5.9 Use of Proceeds. Unless otherwise approved by the Board, the proceeds raised by the Company pursuant to this Agreement shall be used solely for the development of iDine. ARTICLE VI CONDITIONS AND SCHEDULE UPDATES 6.1 Conditions to Obligation of Each Party. The respective obligations of each party to effect the transactions contemplated by this Agreement shall be subject to the satisfaction at or prior to the Closing Date of the following conditions: (a) No temporary restraining order, preliminary or permanent injunction or other order or decree by any court of competent jurisdiction which prevents the consummation of the transactions contemplated by this Agreement or the other Transaction Documents or imposes material conditions with respect thereto shall have been issued and remain in effect (each party agreeing to use its reasonable efforts to have any such injunction, order or decree lifted); (b) No action shall have been taken, and no statute, rule or regulation shall have been enacted, by any Governmental Entity which would prevent the consummation of the transactions contemplated by this Agreement or the other Transaction Documents or impose material conditions with respect thereto; (c) All orders, consents and approvals of Governmental Entities legally required for the consummation of the transactions contemplated by this Agreement or the other Transaction Documents shall have been obtained and be in effect at the Closing Date; (d) The Shares and the Warrant Shares to be issued at the Closing shall have been approved for listing by the New York Stock Exchange upon official notice of issuance; and (e) The Proxy Proposal shall have received Stockholder Approval. 6.2 Condition to Obligations of the Company. The obligation of the Company to effect the transactions contemplated by this Agreement shall be subject to the fulfillment at or prior the Closing Date (except as noted below) of the following additional conditions: -13- 14 (a) The Purchasers shall have performed in all material respects all obligations by the Purchasers required to be performed at or prior to the Closing Date, and the representations and warranties of the Purchasers contained in this Agreement shall be true and correct in all material respects (if not qualified by materiality) and true and correct (if so qualified) on and as of the date of this Agreement and at and as of the Closing Date as if made at and as of the Closing Date, except to the extent that any such representation or warranty expressly relates to another date (in which case, as of such date) and the Company shall have received a certificate signed on behalf of each the Purchasers, to such effect; (b) No action or proceeding shall be pending against the Company or the Purchasers before any court of competent jurisdiction to prohibit, restrain, enjoin or restrict the consummation of the transactions contemplated by this Agreement or the other Transaction Documents; and (c) All consents, approvals, authorizations and permits of, actions by, filing with or notifications to, Governmental Entities and third parties required in connection with the transactions contemplated by this Agreement and the other Transaction Documents shall have been obtained, taken or made. 6.3 Conditions to Obligations of the Purchasers. The obligations of the Purchasers to effect the transactions contemplated by this Agreement shall be subject to the fulfillment at or prior to the Closing Date of the following additional conditions: (a) The Company shall have performed in all material respects all obligations required to be performed by it under this Agreement at or prior to the Closing Date, and the representations and warranties of the Company contained in this Agreement shall be true and correct in all material respects (if not qualified by materiality) and true and correct (if so qualified) on and as of the date of this Agreement and at and as of the Closing Date (as modified by the matters or circumstances reflected in the Updated Schedules, if any, provided by the Company to the Purchasers in accordance with Section 6.4 hereof) as if made at and as of the Closing Date, except to the extent that any such representation or warranty expressly relates to another date (in which case, as of such date) and the Purchasers shall have received a certificate from the Company signed by an executive officer), to such effect; (b) No action or proceeding shall be pending against the Company or the Purchasers before any court of competent jurisdiction which action or proceeding has been brought by a Governmental Entity and which is reasonably likely to have a Material Adverse Effect or to prohibit, restrain, enjoin or restrict the consummation of the transactions contemplated by this Agreement or the other Transaction Documents; (c) All consents, approvals, authorizations and permits of, actions by, filings with or notifications to, Governmental Entities and third parties required in connection with the transactions contemplated by this Agreement and the other Transaction Documents shall have been obtained, taken or made; -14- 15 (d) All conditions to the Second Closing shall have been satisfied, and such Second Closing shall occur concurrently herewith; and (e) The Purchasers shall have received an opinion of Morgan, Lewis & Bockius LLP, counsel to the Company, containing the opinions in the form attached hereto as Exhibit B with such provisions concerning scope of firm's inquiry, law covered by opinion, reliance by the firm, assumptions, definition of firm's "knowledge", qualifications, limitations and similar matters as shall be reasonably acceptable to the Company. 6.4 Schedule Updates. At any time prior to two (2) business days prior to the Closing, the Company shall be entitled to update any schedule referred to in Article III of this Agreement or add new schedules not referred to in or contemplated by Article III by written notice to the Purchasers if necessary in order to make the corresponding representations and warranties true and correct as of the Closing Date; provided that such updated or new Schedules may only reflect changes in circumstances or matters arising subsequent to the date of the execution of this Agreement that are not the result of any action undertaken, or failure to act, by the Company or the Subsidiaries in breach of any provision of this Agreement (any such updated or new schedules, "Updated Schedules"); it being understood that the Company shall not be entitled to reflect in any Updated Schedules any circumstances, matters or facts which were in existence as of or prior to the date of this Agreement, whether or not the Company knew or should have known of such circumstances, matters or facts as of the date of this Agreement). If, in accordance with the immediately preceding sentence, new schedules are added, the applicable section or subsection of Article III corresponding to such new schedule shall be read to include the words "except as set forth in Schedule [insert applicable section or subsection number]" or words of similar meaning to appropriately connote the modifications created by such new schedule. The delivery of any Updated Schedules pursuant to this Section 6.4 shall not cure any breach of any representation, warranty or covenant made in this Agreement as of the date of this Agreement. ARTICLE VII TERMINATION, AMENDMENT AND WAIVER 7.1 Termination. This Agreement may be terminated and the transactions contemplated by this Agreement may be abandoned at any time prior to the Closing Date: (a) By mutual written consent of the Purchasers and the Company; (b) By the Purchasers if there has been a material breach by the Company of any representation, warranty, covenant or agreement set forth in this Agreement, which breach has not been cured within ten (10) business days following receipt by the breaching party of notice of such breach; (c) By the Company, if there has been a material breach by the Purchasers of any representation, warranty, covenant or agreement set forth in this Agreement which -15- 16 breach has not been cured within ten (10) business days following receipt by the breaching party of notice of such breach; (d) By the Purchasers, upon notice to the Company, if the Closing shall not have occurred on or before the one hundred twentieth (120th) day following the date of this Agreement, unless the absence of such occurrence shall be due to the failure of the Purchasers to perform in all material respects each of its obligations under this Agreement required to be performed by it at or prior to the Closing; (e) By the Purchasers or the Company, upon notice to the other, if the Company's stockholders fail to adopt the Proxy Proposal at the Stockholders' Meeting; and (f) By the Purchasers, if the Board of Directors of the Company shall withdraw, modify or change its approval or recommendation of the Proxy Proposal in a manner adverse to the Purchasers or shall have resolved to do so. ARTICLE VIII INDEMNIFICATION 8.1 General. From and after the Closing, the parties shall indemnify each other as provided in this Article VIII. No specifically enumerated indemnification obligation with respect to a particular subject matter as set forth below shall limit or affect the applicability of a more general indemnification obligation as set forth below with respect to the same subject matter. For the purposes of this Article VIII, each party shall be deemed to have remade all of its representations, warranties and covenants contained in this Agreement at the Closing with the same effect as if originally made at the Closing, except that the Purchasers shall be deemed to have remade the representations and warranties contained in Section 4.5 and Section 4.9 at the Closing with the same effect as if originally made at the Closing. No Person which may be subject to an indemnification obligation under this Article VIII shall be entitled to require that any action be brought against any other Person before action is brought against it hereunder by a Person seeking indemnification by such Person. 8.2 The Company's Indemnification Obligations. The Company shall indemnify, save and keep harmless each of the Purchasers and each of their respective officers, directors, employees, agents, representatives, Affiliates, successors and permitted assigns against and from all Damages sustained or incurred by any of them resulting from or arising out of or by virtue of any inaccuracy in, breach of or other failure to comply with any representation, warranty or covenant made by the Company in this Agreement or any other Company Transaction Document. A claim for indemnification under this Section 8.2 must be asserted by notice delivered to the Company within ninety (90) days after the Company files with the SEC its Annual Report on Form 10-K for the year ended September 30, 2001 (such ninetieth (90th) day, hereinafter the "Survival Date"); provided, however, that any claims for any inaccuracy in, breach of or other failure to comply with any representation, warranty or covenant made by the Company under -16- 17 Section 3.1, Section 3.5 or Section 3.15 may be made at any time prior to the expiration of any statute of limitations, if any, applicable to such claims. Notwithstanding anything to the contrary in this Agreement, no investigation or lack of investigation by any Purchaser, nor any disclosure in any Schedule hereto or knowledge of any Purchaser as to any indemnifiable matters referred to in this Section 8.2, shall in any way limit the Company's indemnification obligations hereunder. 8.3 The Purchasers' Indemnification Obligations. Each of the Purchasers, severally and not jointly, shall indemnify, save and keep harmless the Company and its officers, directors, employees, agents, representatives, Affiliates, successors and permitted assigns against and from all Damages sustained or incurred by any of them resulting from or arising out of or by virtue of any inaccuracy in, breach of or failure to comply with any representation and warranty made by such Purchaser to the Company in this Agreement or in any other Purchaser Transaction Document. A claim for indemnification under this Section 8.3 must be asserted by notice delivered to the party from whom indemnification is sought no later than the Survival Date. Notwithstanding anything to the contrary in this Agreement, no investigation or lack of investigation by the Company, nor the knowledge of the Company as to any indemnifiable matters referred to in this Section 8.3, shall in any way limit any Purchaser's indemnification obligations hereunder. 8.4 Disputes; Mediation. (a) If the recipient of a notice of a claim for indemnification under either Section 8.2 or 8.3 desires to dispute such claim, it shall, within fourteen (14) days after notice of the claim of loss against it or a notice of dispute is given, give a counter notice, setting forth the basis for disputing such claim, to the Purchasers or the Company, as the case may be. If no such counter notice is given within such fourteen (14) day period, or if the Purchasers or the Company, as the case may be, acknowledge liability for indemnification, then such loss shall be promptly satisfied. (b) If the dispute is not promptly resolved, then, within fourteen (14) days after delivery of the counter notice, or at such later time as may be mutually agreed upon by the parties, the parties shall meet in person to discuss and negotiate in good faith a resolution to the dispute. The meeting shall be conducted in Chicago, Illinois or such other place as may be mutually agreed upon by the parties. (c) If the dispute is not resolved within thirty (30) days after the first meeting of the parties referred to in Section 8.4(b), the parties shall initiate a voluntary, nonbinding mediation conducted by a mutually agreed upon mediator. If the parties are unable to agree upon a mediator, they shall request the clerk of the Circuit Court of Cook County, Illinois to appoint a mediator for them. Each of the parties shall bear their own costs and expenses (including attorneys' fees) and their proportionate share of any other costs, fees or expenses associated with this mediation and endeavor in good faith to resolve their differences. The mediation shall be conducted in Chicago, Illinois or such other place as may be mutually agreed upon by the parties. -17- 18 ARTICLE IX DEFINITIONS "Affiliate" shall mean, with respect to any person, any other person that directly or indirectly through one or more intermediaries, controls or is controlled by or is under common control with such first person. As used in this definition, "control" (including, with correlative meanings, "controlled by" and "under common control with") shall mean the possession, directly or indirectly, of the power to direct or cause the direction of management or policies, whether through the ownership of securities or partnership or other ownership interests, by contract or otherwise. "Common Stock" means the common stock, $.02 par value per share, of the Company. "Contract" means any contract, agreement, commitment, indenture, lease, note, bond, mortgage, license, plan, arrangement or understanding, whether written or oral. "Co-Sale and Voting Agreement" means that certain Co-Sale and Voting Agreement, dated as of even date herewith, among Samstock, the Purchasers and the Company. "Damages" means all liabilities, demands, claims, actions or causes of action, regulatory, legislative or judicial proceedings or investigations, assessments, levies, losses, fines, penalties, damages, costs and expenses, including, without limitation, reasonable attorneys', accountants', investigators', and experts' fees and expenses, sustained or incurred in connection with the defense or investigation of any of the foregoing. "Disinterested Directors" has the meaning set forth in that certain Second Amended and Restated Investment Agreement dated as of June 30, 1999, among the Company, Samstock, EGI-Transmedia Investors, L.L.C., a Delaware limited liability company (formerly known as Transmedia Investors, L.L.C.) and, solely with respect to Section 5 of this agreement, Robert M. Steiner, as trustee under declaration of trust dated March 9, 1983, as amended, establishing the Robert M. Steiner Revocable Trust. "Employment, Consulting or Severance Agreements" means all oral and written (i) agreements for the employment for any period of time whatsoever, or in regard to the employment, or restricting the employment, of any employee of the Company or any Subsidiary, (ii) consulting, independent contractor or similar agreements, and (iii) policies, agreements, arrangements or understandings relating to the payment or provision of severance, termination or similar pay or benefits to any present or former employees, officers, directors, consultants, independent contractors or other agents of the Company or any Subsidiary (including, without limitation, the Company's Senior Executive Severance Policy, any successor thereto or any similar plan). "Equity Securities" means, with respect to the Company or any Subsidiary, as the case may be, (i) any class or series of common stock, preferred stock or other capital stock, whether voting or non-voting, including, without limitation, with respect to the Company, Common Stock and Preferred Stock, (ii) any other equity securities issued by the Company or such Subsidiary, as the case may be, whether now or hereafter authorized for issuance by the Company's or such Subsidiary's, as the case may be, Certificate of Incorporation, (iii) any debt, hybrid or other securities issued by the Company or such Subsidiary, as the case may be, which are convertible -18- 19 into, exercisable for or exchangeable for any other Equity Securities, whether now or hereafter authorized for issuance by the Company's or such Subsidiary's, as the case may be, Certificate of Incorporation, (iv) any equity equivalents (including, without limitation, stock appreciation rights, phantom stock or similar rights), interests in the ownership or earnings of the Company or such Subsidiary, as the case may be, or other similar rights, (v) any written or oral rights, options, warrants, subscriptions, calls, preemptive rights, rescission rights or other rights to subscribe for, purchase or otherwise acquire any of the foregoing, (vi) any written or oral obligation of the Company or such Subsidiary, as the case may be, to issue, deliver or sell, any of the foregoing, (vii) any written or oral obligations of the Company or such Subsidiary, as the case may be, to repurchase, redeem or otherwise acquire any Equity Securities, and (viii) any bonds, debentures, notes or other indebtedness of the Company or such Subsidiary, as the case may be, having the right to vote (or convertible into, or exchangeable for securities having the right to vote) on any matters on which the stockholders of the Company or such Subsidiary, as the case may be, may vote. "Exchange Act" means the Securities Exchange Act of 1934, as amended. "Fully Diluted Common Stock" means the total number of shares of Common Stock outstanding after taking into account the following: (i) all shares of Common Stock outstanding (exclusive of the Shares); (ii) all Shares and Warrant Shares (assuming full exercise of the Warrants and issuance of all Warrant Shares); (iii) all shares of Common Stock issuable upon conversion, exchange or other exercise of the Company's Equity Securities outstanding; and (iv) adjustments needed to account or adjust for stock splits, stock dividends, recapitalizations, recombinations and similar events. "Governmental Entity" means any court, administrative agency or commission or other governmental authority or instrumentality, whether domestic (federal, state or local) or foreign. "iDine" means iDine.com, Inc., a Delaware corporation and a wholly owned subsidiary of the Company established to develop an internet based dining business. "Independent Directors" means directors of the Company who (i) are not current or former employees or officers of the Company, (ii) are not holders of more than 5% of the outstanding Common Stock, and (iii) have no financial interest in and are not otherwise associated with the Purchasers, the Company, any Subsidiary or any holder of more than 5% of the outstanding Common Stock or any of their respective Affiliates, excluding however any equity interest of not more than 2% of any publicly-held entity other than the Company. The term "associated" means having a business, financial or familial relationship that might reasonably be expected to affect the individual's judgment with respect to matters in which the associated person might be interested. "Investment Agreement" means that certain Investment Agreement, dated as of even date herewith, among the Company and the Purchasers. "Lien" means any preemptive or similar rights of any third party, purchase options, calls, proxies, voting trusts, voting agreements, judgments, pledges, charges, assessments, levies, -19- 20 escrows, rights of first refusal or first offer, transfer restrictions, mortgages, indentures, claims, liens, equities, mortgages, deeds of trust, deeds to secure debt, security interests and other encumbrances of every kind and nature whatsoever, whether arising by agreement, operation of law or otherwise, other than any created by the Purchasers or the Purchaser Transaction Documents. "Material Adverse Effect" means a material adverse effect (or any development which could reasonably be expected to have a material adverse effect) on the business, operations, assets, financial or other condition, results of operations or prospects of the Company and the Subsidiaries, taken as a whole, or that could reasonably be expected to impair or delay the ability of the Company to perform its obligations under this Agreement. "Permit" means any permit, certificate, consent, approval, authorization, order, license, variance, franchise or other similar indicia of authority issued or granted by any Governmental Entity. "Person" or "person" means any individual, corporation, partnership, limited liability partnership, limited liability company, joint venture, association, joint stock company, trust, unincorporated organization or Governmental Entity, or any agency or political subdivision thereof, or any other entity. "Preferred Stock" means the preferred stock, $.10 par value per share, of the Company. "Proxy Proposal" means the following proposal to be included in the Proxy Statement for Stockholder Approval: the issuance and sale of the Shares and the Warrants. "Samstock" means Samstock, L.L.C., a Delaware limited liability company. "Securities Act" means the Securities Act of 1933, as amended. "SEC" means the Securities and Exchange Commission. "Second Closing" shall have the meaning set forth in that certain Stock Purchase and Sale Agreement, dated as of April 28, 2000, by and among Minotaur Partners II, L.P., an Illinois limited partnership, ValueVision International Inc., a Minnesota corporation, Dominic Mangone, Raymond Bank and the Company. "Series A Preferred Stock" means the Series A Senior Convertible Redeemable Preferred Stock, par value $.10 per share, of the Company. "Stockholder Approval" means the requisite approval of the Company's stockholders under the Company's Organizational Documents and the Delaware General Corporation Law for the Proxy Proposal. "Subsidiary" means each of (i) Transmedia Restaurant Company Inc., a Delaware corporation, (ii) TMN International Incorporated, a Delaware corporation, (iii) Transmedia Service Company Inc., a Delaware corporation, and (iv) iDine. -20- 21 "Transaction Document" means any Company Transaction Document and any Purchaser Transaction Document. ARTICLE X MISCELLANEOUS 10.1 Restrictive Legend. The Purchasers agree to the placing on the certificates representing the Shares or the Warrant Shares of a legend, in substantially the following form: "The securities evidenced by this certificate have not been registered under the Securities Act of 1933, as amended (the "Act"), or applicable state securities laws and may not be sold, transferred, assigned, offered, pledged or otherwise disposed of unless (i) there is an effective registration statement under such Act and such laws covering such securities or (ii) such sale, transfer, assignment, offer, pledge or other disposition is exempt from the registration and prospectus delivery requirements of such Act and such laws. The securities evidenced by this certificate are subject to the restrictions on transfer contained in the Investment Agreement dated as of April 28, 2000, and the Co-Sale and Voting Agreement dated as of April 28, 2000, in each case, to which the Company is a party, as amended, supplemented or otherwise modified from time to time, and may not be transferred except in compliance therewith." 10.2 Notices. All notices, and other communications hereunder shall be in writing and shall be deemed given if delivered personally, sent by documented overnight delivery service or, to the extent receipt is confirmed, facsimile, to the appropriate address or facsimile number set forth below (or at such other address or facsimile number for a party as shall be specified by like notice): if to any Purchaser, at their respective addresses set forth on the signature pages hereto. with an additional copy to: --------------------------- --------------------------- --------------------------- if to the Company: Transmedia Network Inc. 11900 Biscayne Boulevard Miami, Florida 33181 Attention: Chief Executive Officer Fax: (305) 892-3342 -21- 22 with a copy to: Morgan, Lewis & Bockius LLP 101 Park Avenue New York, New York 10178 Attention: Stephen P. Farrell, Esq. Fax: (212) 309-6273 10.3 Expenses. Except as otherwise provided in this Agreement, the Company shall bear all fees and expenses incurred by the Company or any Subsidiary in connection with, relating to or arising out of the execution, delivery and performance of this Agreement and the other Company Transaction Documents and the consummation of the transaction contemplated hereby and thereby, including attorneys', accountants' and other professional fees and expenses. The Purchasers shall bear all fees and expenses incurred by the Purchasers in connection with, relating to or arising out of the execution, delivery and performance of this Agreement and the other Purchaser Transaction Documents and the consummation of the transaction contemplated hereby and thereby, including attorneys', accountants' and other professional fees and expenses. 10.4 Severability. If any term or other provision of this Agreement is invalid, illegal or incapable of being enforced by any rule of law or public policy, all other conditions and provisions of this Agreement shall nevertheless remain in full force and effect so long as the economic or legal substance of the transactions contemplated hereby is not affected in any manner adverse to any party. Upon such determination that any term or other provision is invalid, illegal or incapable of being enforced, the parties hereto shall negotiate in good faith to modify this Agreement so as to effect the original intent of the parties as closely as possible in an acceptable manner to the end that the transactions contemplated hereby are fulfilled to the fullest extent possible 10.5 Entire Agreement; Amendment; Waiver; Assignment; Nature of Obligations. This Agreement, together with the other Transaction Documents, constitutes the entire agreement among the parties with respect to the subject matter hereof and thereof and supersedes all prior agreements and undertakings, both written and oral, among the parties, or any of them, with respect to the subject matter hereof and thereof. No amendment, supplement, modification or waiver of this Agreement shall be binding unless executed in writing by the party to be bound thereby. No waiver of any of the provisions of this Agreement shall be deemed or shall constitute a waiver of any other provision of this Agreement, whether or not similar, nor shall such waiver constitute a continuing waiver unless otherwise expressly provided. This Agreement shall not be assigned by operation of law or otherwise; provided, however, that, notwithstanding the foregoing, each Purchaser may assign its or their rights and obligations hereunder to (i) any controlled Affiliate of such Purchaser, (ii) any officer, manager, partner or member of such Purchaser, (iii) any Affiliate of any officer, manager, partner or member of such Purchaser, (iv) any family member of such Purchaser or (v) any trust established for the benefit of any family member of such Purchaser (each of (i), (ii), (iii), (iv) and (v), a "Permitted Assignee"), upon the -22- 23 receipt by the Company of the written agreement of any such Permitted Assignee to be bound by the terms of each of the Purchaser Transaction Documents; provided further, however, that no such assignment shall relieve the assigning party of any of its liabilities or obligations under this Agreement. Any attempted assignment which does not comply with the provisions of this Section 10.5 shall be null and void ab initio. 10.6 Parties in Interest. Subject to the provisions regarding assignment in Section 10.5 above, this Agreement shall be binding upon and inure solely to the benefit of each party hereto, and nothing in this Agreement, express or implied, is intended to or shall confer upon any other person any rights, benefits or remedies of any nature whatsoever under or by reason of this Agreement. 10.7 Publicity. Neither the Company nor the Purchasers will make or issue, or cause to be made or issued, any announcement or written statements concerning the Transaction Documents or the transactions contemplated thereby for dissemination to the general public without the prior written consent of the Company or the Purchasers, as appropriate, which consent shall not be unreasonably withheld. This provision will not apply to any announcement or written statement required to be made by law or the regulations of the SEC or the New York Stock Exchange, except that the party required to make such announcement will, whenever practicable, consult with the other parties hereto concerning the timing and content of such announcement before such announcement is made. 10.8 Governing Law. This Agreement shall be governed and controlled as to validity, enforcement, interpretation, construction, effect and in all other respects by the internal laws of the State of Delaware applicable to contracts made in that State. 10.9 Headings. The descriptive headings contained in this Agreement are included for convenience of reference only and shall not affect in any way the meaning or interpretation of this Agreement. 10.10 Interpretation. Unless the context requires otherwise, all words used in this Agreement in the singular number shall extend to and include the plural, all words in the plural number shall extend to and include the singular, and all words in any gender (including neutral gender) shall extend to and include all genders. 10.11 Counterparts. This Agreement may be executed in two or more counterparts, and by the different parties hereto in separate counterparts, each of which when executed shall be deemed to be an original but all of which taken together shall constitute one and the same agreement. 10.12 Jurisdiction and Service of Process. THE COMPANY AND THE PURCHASERS HEREBY CONSENT TO THE JURISDICTION OF ANY STATE OR FEDERAL COURT LOCATED WITHIN THE STATE OF DELAWARE AND IRREVOCABLY AGREE THAT, SUBJECT TO THE OTHER PROVISIONS OF THIS AGREEMENT, ALL ACTIONS OR PROCEEDINGS ARISING OUT OF OR RELATING TO THIS AGREEMENT WHICH MAY BE LITIGATED SHALL BE LITIGATED IN SUCH COURTS. EACH OF THE COMPANY AND -23- 24 THE PURCHASERS ACCEPTS FOR SUCH PARTY AND IN CONNECTION WITH SUCH PARTY'S PROPERTIES, GENERALLY AND UNCONDITIONALLY, THE NONEXCLUSIVE JURISDICTION OF THE AFORESAID COURTS AND WAIVES ANY DEFENSE OF FORUM NON CONVENIENS, AND IRREVOCABLY AGREES TO BE BOUND BY ANY JUDGMENT RENDERED THEREBY IN CONNECTION WITH THIS AGREEMENT. EACH OF THE COMPANY AND THE PURCHASERS AGREES TO ACCEPT SERVICE OF ALL PROCESS BY REGISTERED OR CERTIFIED MAIL, RETURN RECEIPT REQUESTED, IN ANY SUCH PROCEEDINGS IN ANY SUCH COURT, SUCH SERVICE BEING HEREBY ACKNOWLEDGED BY EACH SUCH PARTY TO BE EFFECTIVE AND BINDING SERVICE IN EVERY RESPECT. IF ANY AGENT APPOINTED BY THE COMPANY OR THE PURCHASERS REFUSES TO ACCEPT SERVICE, SUCH PARTY HEREBY AGREES THAT SERVICE UPON SUCH PARTY BY MAIL SHALL CONSTITUTE SUFFICIENT NOTICE. NOTHING HEREIN SHALL AFFECT THE RIGHT TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR SHALL LIMIT THE RIGHT OF THE COMPANY OR THE PURCHASERS TO BRING PROCEEDINGS AGAINST THE COMPANY OR THE PURCHASERS IN THE COURTS OF ANY OTHER JURISDICTION. 10.13 Trial. EACH OF THE COMPANY AND THE PURCHASERS HEREBY WAIVES SUCH PARTY'S RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF THIS AGREEMENT OR ANY DEALINGS BETWEEN THE PARTIES HERETO RELATING TO THE SUBJECT MATTER HEREOF. EACH OF THE COMPANY AND THE PURCHASERS ALSO WAIVES ANY BOND OR SURETY OR SECURITY UPON SUCH BOND WHICH MIGHT, BUT FOR THIS WAIVER, BE REQUIRED OF ANY PARTY TO THIS AGREEMENT WITH RESPECT TO ANY ACTION COMMENCED BY ONE OF THEM AGAINST THE OTHER OF THEM. THE SCOPE OF THIS WAIVER IS INTENDED TO BE ALL-ENCOMPASSING OF ANY AND ALL DISPUTES THAT MAY BE FILED IN ANY COURT AND THAT RELATE TO THE SUBJECT MATTER OF THIS TRANSACTION, INCLUDING WITHOUT LIMITATION, CONTRACT CLAIMS, TORT CLAIMS, BREACH OF DUTY CLAIMS, AND ALL OTHER COMMON LAW AND STATUTORY CLAIMS. EACH OF THE COMPANY AND THE PURCHASERS ACKNOWLEDGES THAT THIS WAIVER IS A MATERIAL INDUCEMENT TO ENTER INTO A BUSINESS RELATIONSHIP, THAT EACH HAS ALREADY RELIED ON THE WAIVER IN ENTERING INTO THIS AGREEMENT AND THAT EACH WILL CONTINUE TO RELY ON THE WAIVER IN THEIR RELATED FUTURE DEALINGS. EACH OF THE COMPANY AND THE PURCHASERS FURTHER WARRANTS AND REPRESENTS THAT SUCH PARTY HAS REVIEWED THIS WAIVER WITH SUCH PARTY'S LEGAL COUNSEL, AND THAT SUCH PARTY KNOWINGLY AND VOLUNTARILY WAIVES SUCH PARTY'S JURY TRIAL RIGHTS FOLLOWING CONSULTATION WITH LEGAL COUNSEL. THIS WAIVER IS IRREVOCABLE, MEANING THAT IT MAY NOT BE MODIFIED EITHER ORALLY OR IN WRITING, AND THE WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT. IN THE EVENT OF LITIGATION, THIS AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO A TRIAL BY THE COURT. -24- 25 IN WITNESS WHEREOF, the Purchasers and the Company have executed this Stock Purchase and Sale Agreement as of the date first above written. THE PURCHASERS: ------------------------------------- GENE M. HENDERSON Address: ---------------------------- ------------------------------------- ------------------------------------- ------------------------------------- HERBERT M. GARDNER Address: ---------------------------- ------------------------------------- ------------------------------------- ------------------------------------- JAMES M. CALLAGHAN Address: ---------------------------- ------------------------------------- ------------------------------------- ------------------------------------- GREGORY J. ROBITAILLE Address: ---------------------------- ------------------------------------- ------------------------------------- ------------------------------------- JOHN A. WARD Address: ---------------------------- ------------------------------------- ------------------------------------- ------------------------------------- GEORGE S. WEIDEMANN Address: ---------------------------- ------------------------------------- ------------------------------------- -25- 26 ------------------------------------- CHRISTINE M. DONOHOO Address: ---------------------------- ------------------------------------- ------------------------------------- ------------------------------------- FRANK F. SCHMEYER Address: ---------------------------- ------------------------------------- ------------------------------------- ------------------------------------- ELLIOT MERBERG Address: ---------------------------- ------------------------------------- ------------------------------------- ------------------------------------- GERALD FLEISCHMAN Address: ---------------------------- ------------------------------------- ------------------------------------- SAMSTOCK, L.L.C. ------------------------------------- By: Its: Address: ----------------------------- ------------------------------------- ------------------------------------- ------------------------------------- TIM LITLE Address: ---------------------------- ------------------------------------- ------------------------------------- COMPANY: TRANSMEDIA NETWORK INC. ------------------------------------- By: Gene M. Henderson, President and Chief Executive Officer -26- 27 EXHIBIT A THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR APPLICABLE STATE SECURITIES LAWS AND MAY NOT BE SOLD, TRANSFERRED, ASSIGNED, OFFERED, PLEDGED OR OTHERWISE DISPOSED OF UNLESS (I) THERE IS AN EFFECTIVE REGISTRATION STATEMENT UNDER SUCH ACT AND SUCH LAWS COVERING SUCH SECURITIES OR (II) SUCH SALE, TRANSFER, ASSIGNMENT, OFFER, PLEDGE OR OTHER DISPOSITION IS EXEMPT FROM THE REGISTRATION AND PROSPECTUS DELIVERY REQUIREMENTS OF SUCH ACT AND SUCH LAWS. THE SECURITIES EVIDENCED BY THIS CERTIFICATE ARE NON-TRANSFERABLE, EXCEPT AS PROVIDED HEREIN. TRANSMEDIA NETWORK INC. WARRANT TO PURCHASE [____________] SHARES OF COMMON STOCK VOID AFTER APRIL 28, 2005 THIS CERTIFIES THAT, for value received, [_______________] (the "HOLDER"), is entitled to subscribe for and purchase from Transmedia Network Inc., a Delaware corporation (the "COMPANY"), an aggregate of [____________] shares (as adjusted pursuant to Section 3 hereof) of fully paid and nonassessable Common Stock (the "SHARES") of the Company, at the price per share set forth below (the "EXERCISE PRICE") (as adjusted pursuant to Section 3 hereof), and subject to the provisions and upon the terms and conditions hereinafter set forth. Shares Exercise Price Per Share ------ ------------------------ [1/2of Shares] $5.93125 [1/2of Shares] $7.30000 1. Exercise; Payment. (a) Time of Exercise; Expiration. This Warrant is immediately exercisable. This Warrant shall expire at, and shall no longer be exercisable after, 5:00 p.m., Chicago local time, on April 28, 2005. (b) Method of Exercise. 28 (i) Cash Exercise. The purchase rights represented by this Warrant may be exercised by the Holder, at any time, in whole, or from time to time, in part, by the surrender of this Warrant (with the notice of exercise form attached hereto as Exhibit 1 duly executed) at the principal office of the Company, and by the payment to the Company, by certified, cashier's or other check acceptable to the Company, of an amount equal to the aggregate Exercise Price of the Shares being purchased. (ii) Net Issue Exercise. In lieu of exercising this Warrant, the Holder may elect to receive Shares equal to the value of this Warrant (or the portion thereof being canceled) by surrender of this Warrant at the principal office of the Company together with notice of such election, in which event the Company shall issue to the Holder a number of shares of the Company's Common Stock computed using the following formula: X = Y (A-B) ------- A Where X = the number of Shares to be issued to the Holder. Y = the number of Shares purchasable under this Warrant (or the portion thereof being cancelled) A = the fair market value of one share of the Company's Common Stock. B = the Exercise Price (as adjusted to the date of such calculation). (iii) Fair Market Value. For purposes of this Section 1, the fair market value of the Company's Common Stock shall mean: A. The average closing price of the Company's Common Stock on the New York Stock Exchange or in the event the Company's Common Stock is not then traded on the New York Stock Exchange the average closing price quoted on any exchange on which the Common Stock is listed, as published in the Mid-Western Edition of the Wall Street Journal for the ten consecutive trading days prior to the date of determination of fair market value. B. If the Company's Common Stock is not then traded on the New York Stock Exchange or on another exchange, the per share fair market value of the Common Stock shall be the fair market value price per share as determined in good faith by the Company's Board of Directors. (c) Stock Certificates. In the event of any exercise of the rights represented by this Warrant, certificates for the shares of Common Stock so purchased shall be delivered to the Holder within a reasonable time and, unless this Warrant has been fully exercised or has expired, a new Warrant of identical terms and provisions as those hereof, representing the shares with respect to which this Warrant shall not have been exercised shall also be issued to the Holder within such time. 29 2. Stock Fully Paid; Reservation of Shares. All of the Shares issuable upon the exercise of the rights represented by this Warrant will, upon issuance and receipt of the Exercise Price therefor, be fully paid and nonassessable, and free from all taxes, liens and charges with respect to the issue thereof. During the period within which the rights represented by this Warrant may be exercised, the Company shall at all times have authorized and reserved for issuance sufficient shares of its Common Stock to provide for the exercise of the rights represented by this Warrant. 3. Adjustment of Exercise Price and Number of Shares. The number and kind of Shares purchasable upon the exercise of this Warrant and the Exercise Price shall be subject to adjustment from time to time upon the occurrence of certain events, as follows: (a) Reclassification. In case of any reclassification or change of outstanding securities of the class issuable upon exercise of this Warrant (other than a change in par value, or from par value to no par value, or from no par value to par value, or as a result of a subdivision or combination), the Company shall, as condition precedent to such transaction, execute a new Warrant providing that the Holder shall have the right to exercise such new Warrant and upon such exercise to receive, in lieu of each share of stock theretofore issuable upon exercise of this Warrant, the kind and amount of shares of stock, other securities, money and property receivable upon such reclassification or change by a holder of one share of stock. Such new Warrant shall provide for adjustments which shall be as nearly equivalent as may be practicable to the adjustments provided for in this Section 3. The provisions of this Section 3(a) shall similarly apply to successive reclassifications or changes. (b) Subdivision or Combination of Warrant Shares. If the Company at any time while this Warrant remains outstanding and unexpired shall subdivide or combine its stock, the Exercise Price shall be proportionately decreased in the case of a subdivision or increased in the case of a combination. (c) Stock Dividends. If the Company at any time while this Warrant is outstanding and unexpired shall pay a dividend with respect to stock payable in, or make any other distribution with respect to stock (except any distribution specifically provided for in the foregoing Section 3(a) and 3(b)) of stock, then the Exercise Price shall be adjusted, from and after the date of determination of stockholders entitled to receive such dividend or distribution, to that price determined by multiplying the Exercise Price in effect immediately prior to such date of determination by a fraction (i) the numerator of which shall be the total number of shares of stock outstanding immediately prior to such dividend or distribution, and (ii) the denominator of which shall be the total number of shares of stock outstanding immediately after such dividend or distribution. (d) Adjustment of Number of Warrant Shares. Upon each adjustment in the Exercise Price, the number of shares of stock purchasable hereunder shall be adjusted, to the 30 nearest whole share, to the product obtained by multiplying the number of Shares purchasable immediately prior to such adjustment in the Exercise Price by a fraction, the numerator of which shall be the Exercise Price immediately prior to such adjustment and the denominator of which shall be the Exercise Price immediately thereafter. 4. Notice of Adjustments. Whenever the number of Shares purchasable hereunder or the Exercise Price thereof shall be adjusted pursuant to Section 3 hereof, the Company shall provide notice by first class mail to the holder of this Warrant setting forth, in reasonable detail, the event requiring the adjustment, the amount of the adjustment, the method by which such adjustment was calculated, and the number of Shares which may be purchased and the Exercise Price therefor after giving effect to such adjustment. 5. Fractional Shares. No fractional shares of Common Stock will be issued in connection with any exercise hereunder. In lieu of such fractional shares the Company shall make a cash payment therefor based upon the Exercise Price then in effect. 6. Warrant Exchangeable for Different Denominations. This Warrant is exchangeable, upon the surrender hereof by the Holder at the principal office of the Company, for new Warrants of like tenor representing in the aggregate the purchase rights hereunder, and each of such new Warrants will represent such portion of such rights as is designated by the Holder at the time of such surrender. All Warrants representing portions of the rights hereunder are referred to herein as the "Warrant." 7. Replacement. Upon receipt of evidence reasonably satisfactory to the Company (an affidavit of the Holder is deemed to be reasonably satisfactory) of the ownership and the loss, theft, destruction or mutilation of this Warrant, and in the case of any such loss, theft or destruction, upon the receipt of indemnity reasonably satisfactory to the Company, or, in the case of any such mutilation upon surrender of such Warrant, the Company will (at its expense, except for the cost of any lost security indemnity bond required which shall be paid for by the Holder) execute and deliver in lieu of such Warrant a new Warrant of like kind representing the same rights represented by such lost, stolen, destroyed or mutilated Warrant and dated the date of such lost, stolen, destroyed or mutilated Warrant. 8. Restrictive Legend. The Shares issuable upon exercise of this Warrant (unless registered under the Act) shall be stamped or imprinted with a legend in substantially the following form: "The securities evidenced by this certificate have not been registered under the Securities Act of 1933, as amended (the "Act"), or applicable state securities laws and may not be sold, transferred, assigned, offered, pledged or otherwise disposed of unless (i) there is an effective registration statement under such Act and such laws covering such securities or (ii) such sale, transfer, assignment, offer, pledge or other disposition is exempt from the registration and prospectus delivery requirements of such Act and such laws. The securities evidenced by this certificate are subject to the 31 restrictions on transfer contained in the Investment Agreement dated as of April 28, 2000, and the Co-Sale and Voting Agreement dated as of April 28, 2000, in each case, to which the Company is a party, as amended, supplemented or otherwise modified from time to time, and may not be transferred except in compliance therewith." 9. Restrictions on Transfer. Neither this Warrant, nor any interest herein, may be transferred to any party without the Company's prior written consent; provided, however, that this Warrant may be transferred to (i) any controlled Affiliate of Holder, (ii) [any partner of Holder or (iii) any Affiliate of any partner of Holder][any family member of Holder or (iii) any trust established for the benefit of any family member of Holder], upon delivery to the Company of (i) the Notice of Transfer in the form of Exhibit 2 hereto and (ii) an opinion of counsel to the Purchasers stating that such transfer of the Warrant does not violate the Act. 10. Rights of Stockholders. No holder of this Warrant shall be entitled, as a Warrant holder, to vote or receive dividends or be deemed the holder of Common Stock or any other securities of the Company which may at any time be issuable on the exercise hereof for any purpose, nor shall anything contained herein be construed to confer upon the holder of this Warrant, as such, any of the rights of a stockholder of the Company or any right to vote for the election of directors or upon any matter submitted to shareholders at any meeting thereof, or to give or withhold consent to any corporate action (whether upon any recapitalization, issuance of stock, reclassification of stock, change of par value, consolidation, merger, conveyance, or otherwise) or to receive notice of meetings, or to receive dividends or subscription rights or otherwise until the Warrant shall have been exercised and the Shares purchasable upon the exercise hereof shall have become deliverable, as provided herein. 11. Notices, Etc. All notices and other communications between the Company and the Holder shall be mailed by first class registered or certified mail, postage prepaid, (i) if to the Company, at the Company's executive offices, and (ii) if to the Holder, at such address as may have been furnished to the Company in writing by the Holder. 12. Governing Law, Headings. This Warrant is being delivered in the State of Delaware and shall be construed and enforced in accordance with and governed by the laws of such State. The headings in this Warrant are for purposes of reference only, and shall not limit or otherwise affect any of the terms hereof. Issued this 28th day of April, 2000. TRANSMEDIA NETWORK INC. By: ---------------------------------- Its: 32 EXHIBIT 1 NOTICE OF EXERCISE TO: TRANSMEDIA NETWORK INC. 11900 Biscayne Boulevard Miami, Florida 33181 Attention: Chief Executive Officer 1. The undersigned hereby elects to purchase __________ shares of Common Stock of TRANSMEDIA NETWORK INC. pursuant to the terms of the attached Warrant. 2. Method of Exercise (Please mark the applicable blank): ___ The undersigned elects to exercise the attached Warrant by means of a cash payment, and tenders herewith payment in full for the purchase price of the shares being purchased. ___ The undersigned elects to exercise the attached Warrant by means of the net exercise provisions of Section 1(b)(ii) of the Warrant. 3. Please issue a certificate or certificates representing said shares of Common Stock in the name of the undersigned or in such other name as is specified below: ------------------------------------- (Name) ------------------------------------- ------------------------------------- (Address) ------------------------------------- (Signature) Title: ------------------------------- - ------------------------- (Date) 33 EXHIBIT 2 NOTICE OF TRANSFER FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto _______________________________ the right represented by the attached Warrant to purchase _______* shares of Common Stock of TRANSMEDIA NETWORK INC., to which the attached Warrant relates, and appoints ________________ Attorney-in-Fact to transfer such right on the books of TRANSMEDIA NETWORK INC., with full power of substitution in the premises. Dated: -------------------------- ------------------------------------- By: ---------------------------------- ------------------------------------- (Address) - ---------- * Insert here the number of shares without making any adjustment for additional shares of Common Stock or any other stock or other securities or property or cash which, pursuant to the adjustment provisions of the Warrant, may be deliverable upon exercise. 34 EXHIBIT B OPINION OF COMPANY COUNSEL (1) Each of the Company and each Subsidiary is a corporation duly organized, validly existing and in good standing under the laws of the jurisdiction of its incorporation and has the requisite corporate power and authority to carry on its business as it is now being conducted. Each of the Company and each Subsidiary is duly qualified or licensed as a foreign corporation to do business, and is in good standing, in each jurisdiction (including any foreign country) where the character of its properties owned, leased or operated by it or the nature of its activities makes such qualification or licensing necessary, except for such failures to be so qualified or licensed or in good standing which would not, individually or in the aggregate, have a Material Adverse Effect. (2) The certificates of incorporation of the Company and each Subsidiary and the bylaws of the Company and each Subsidiary as currently in effect (collectively, the "Organizational Documents") are in full force and effect, and, to our knowledge after due inquiry, no other organizational documents are applicable to or binding upon the Company or any Subsidiary. (3) Upon payment of the Purchase Price, the Purchasers will acquire good and marketable title to the Shares and the Warrants, free and clear of all Liens, and such Shares shall be validly issued, fully paid and nonassessable. Upon exercise of the Warrants, in whole or, from time to time, in part, and upon payment of the exercise price therefor, in accordance with the terms of the Warrants, the Purchasers will acquire good and marketable title to the Warrant Shares, free and clear of all Liens, and such Warrant Shares shall be validly issued, fully paid and nonassessable. (4) The Company has all necessary corporate power and authority to execute and deliver the Purchase Agreement, the Co-Sale and Voting Agreement, the Investment Agreement, the Warrants and all other documents, instruments and other writings to be executed and/or delivered by or on behalf of the Company to the Purchasers or any of its representatives in connection with the transactions contemplated hereby or thereby (collectively, the "Company Transaction Documents"), to perform its obligations thereunder and to consummate the transactions contemplated thereby. The execution, delivery and performance of each of the Company Transaction Documents by the Company, and the consummation by the Company of the transactions contemplated thereby, have been duly and validly authorized by the Board of Directors of the Company (the "Board"), and no other corporate proceedings on the part of the Company are necessary to authorize the execution, delivery and performance of the Company Transaction Documents or the consummation of the transactions contemplated thereby, other than Stockholder Approval. The Board has approved each of the Company Transaction Documents and the transactions contemplated hereby and thereby so as to render inapplicable to such transactions, including, without limitation, the issuance to the Purchasers of the Shares, the Warrant and Warrant Shares, the restrictions contained in Article Seventh of the Certificate of Incorporation of the Company, and the restrictions contained in Section 203 of the Delaware General Corporation Law. Each of the 35 Company Transaction Documents has been duly and validly executed and delivered by the Company and, assuming the due authorization, execution and delivery hereof and thereof by the Purchasers, each constitutes a legal, valid and binding obligation of the Company enforceable against the Company in accordance with its terms, except as such enforcement may be subject to (i) bankruptcy, insolvency, reorganization, moratorium or other similar laws relating to creditors' rights generally and (ii) general principles of equity (whether applied in a proceeding at law or in equity). (5) The execution, delivery and performance of the Company Transaction Documents by the Company do not and will not: (a) conflict with or violate the Organizational Documents of the Company or any Subsidiary; (b) conflict with or violate any law, rule, regulation, order, judgment or decree applicable to the Company or any Subsidiary or by which its or any of their respective properties are bound or affected; (c) require any consent, approval, authorization or permit of, action by, filing with or notification to, any Governmental Entity; or (d) to our knowledge after due inquiry, result in any breach or violation of or constitute a default (or an event which with notice or lapse of time or both could become a default) or result in the loss by the Company or any Subsidiary of a material benefit under, or give rise to any right of termination, amendment, acceleration or cancellation of, or result in the creation of a Lien on any of the properties or assets of the Company or any Subsidiary pursuant to, any Contract or Permit identified on any schedule to the Purchase Agreement. (6) The affirmative vote of the holders of no more than a majority of the outstanding shares of Common Stock and the Series A Preferred Stock, voting together as a class, is the only vote of the holders of any class or series of capital stock or other Equity Securities of the Company necessary to approve the sale of the Shares and the Warrants. (7) No "fair price", "moratorium", "control share acquisition" or other similar anti-takeover statute or regulation enacted under state or federal laws or applicable stock exchange rules or regulations, including, without limitation, Section 203 of the Delaware General Corporation Law, applicable to the Company or any Subsidiary is applicable to the transactions contemplated by the Purchase Agreement or any other Company Transaction Document, taken individually or in the aggregate. - ------------ NOTE: Company counsel opinion will be limited to Federal law, the law of New York State and Delaware General Corporation Law. 36 Schedule 1
- -------------------------------------------------------------------------------- Investor Purchase Price Shares Warrants - -------------------------------------------------------------------------------- Gene M. Henderson $250,000 54,795 109,590 - ----------------------------------------------------------------------------- Herbert M. Gardner $150,000 32,877 65,754 - ----------------------------------------------------------------------------- James M. Callaghan $100,000 21,918 43,836 - ----------------------------------------------------------------------------- Gregory J. Robitaille $100,000 21,918 43,836 - ----------------------------------------------------------------------------- John A. Ward $50,000 10,959 21,918 - ----------------------------------------------------------------------------- George S. Wiedemann $50,000 10,959 21,918 - ----------------------------------------------------------------------------- Christine M. Donohoo $50,000 10,959 21,918 - ----------------------------------------------------------------------------- Frank F. Schmeyer $50,000 10,959 21,918 - ----------------------------------------------------------------------------- Gerald Fleischman $50,000 10,959 21,918 - ----------------------------------------------------------------------------- Elliot Merberg $50,000 10,959 21,918 - ----------------------------------------------------------------------------- Samstock L.L.C. $1,850,000 405,479 810,958 - ----------------------------------------------------------------------------- Tim Litle $250,000 54,795 109,590 - ----------------------------------------------------------------------------- TOTAL $3,000,000 657,536 1,315,072 - -----------------------------------------------------------------------------
37 Schedule 3.3(c) Outstanding Equity Securities of the Company See attached. 38 Schedule 3.3(d) Ownership of Capital Stock See attached. 39 Schedule 3.7(a) Employment, Consulting and Severance Agreements 1. Employment Agreements. (a) Employment Agreement by and between Transmedia Network Inc. and Gregory J. Robitaille dated April 7, 2000. (b) Employment Agreement by and between Transmedia Network Inc. and Gerald J. Hughes dated April 2, 2000. (c) Employment Agreement by and between iDine.com, Inc. and Russell D. Dash dated April 18, 2000. 2. Consulting Agreements. (a) Consulting Agreement by and between Transmedia Network Inc. and Luminant Worldwide. (b) Consulting Agreement by and between iDine.com, Inc. and the etailing group, inc. dated April 15, 2000. 3. Severance Agreements. None. 40 Schedule 3.7(b) Employment, Consulting and Severance Agreement Defaults; Severance Payments None. 41 Schedule 3.10 Certain Changes or Events None. 42 Schedule 3.11 Litigation; Compliance None. 43 Schedule 4.6 Share Ownership of Purchasers EX-99.11 3 CO-SALE AND VOTING AGREEMENT 1 EXHIBIT 11 CO-SALE AND VOTING AGREEMENT This CO-SALE AND VOTING AGREEMENT ("Agreement") is dated as of April 28, 2000, by and among Transmedia Network Inc., a Delaware corporation (the "Company"), Samstock, L.L.C., a Delaware limited liability company ("Samstock"), Minotaur Partners II, L.P., an Illinois limited partnership ("MP II"), ValueVision International Inc., a Minnesota corporation ("ValueVision"), Dominic Mangone ("Mangone") and Raymond Bank ("Bank" and, together with MP II, ValueVision and Mangone, the "New Investors"). Capitalized terms used and not otherwise defined in this Agreement have the meanings ascribed to them in Section 5 hereof. R E C I T A L S WHEREAS, reference is hereby made to: (i) that certain Stock Purchase and Sale Agreement, dated as of April 28, 2000, (the "Purchase Agreement") among the Company and the New Investors, pursuant to which the New Investors agreed to purchase from the Company, and the Company has agreed to sell to the New Investors, (a) an aggregate of 1,534,247 newly issued shares of common stock of the Company, par value $.02 per share (the "Common Stock"), and (b) warrants to purchase an additional 3,068,494 shares of Common Stock in the aggregate; and (ii) that certain Investment Agreement, dated as of even date herewith, among the Company and the New Investors (the "Investment Agreement"). Capitalized terms used and not defined in this Agreement shall have the meanings ascribed to them in the Investment Agreement. WHEREAS, the parties desire to establish certain rights and restrictions related to the transfer of Shares. A G R E E M E N T NOW, THEREFORE, in consideration of the foregoing, and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereby agree as follows: Section 1. Co-Sale Rights. In the event that Samstock enters into an agreement to sell to any independent third party or group of independent third parties, in a single transaction or related series of transactions, other than a Public Sale, such number of Shares as equals or exceeds more than ten percent (10%) of the Shares held by Samstock, Samstock shall first notify the New Investors in writing, of the identity of the proposed purchaser(s), the number of Shares proposed to be sold, the proposed purchase price and terms of sale and an estimate of the Transaction Costs (as defined below) (which estimate shall not be binding on Samstock and shall have no effect on Samstock's or the New Investors' rights or obligations under this Section 1). The New Investors thereupon shall have the right to participate in the proposed sale at the same net price per share and other terms of sale as offered to Samstock; provided, however, that the New Investors' right to participate in the proposed sale shall be subordinate to the rights of the Stockholder (as such term is defined in each of (i) the Amended and Restated Agreement Among Stockholders (the "Agreement Among Stockholders") dated as of March 3, 1998, by and among Samstock, EGI-Transmedia Investors, L.L.C., a Delaware limited liability company (formerly known as Transmedia Investors, L.L.C., "TNI"), Stockholder and the Company, and (ii) the 2 Stockholders' Agreement ("Stockholders' Agreement") dated as of March 3, 1998, by and among Samstock, TNI, Stockholder and the Company) to participate in the proposed sale. In order to exercise its co-sale rights, the New Investors, within ten (10) business days after receiving notice from Samstock, shall deliver to Samstock a written election to participate in the sale to the extent allowed by this Section 1. If the New Investors have elected to participate in the proposed sale, the New Investors shall be entitled to sell in the proposed sale a number of Shares equal to the product of (i) the quotient (the "Co-Sale Fraction") determined by dividing the number of Shares owned by the New Investors by the aggregate number of Shares owned by the New Investors and Samstock multiplied by (ii) (a) the total number of Shares to be sold by them in the proposed sale less (b) the total number of Shares that Stockholder shall have elected to sell pursuant to the co-sale rights granted to Stockholder in each of the Agreement Among Stockholders and the Stockholders' Agreement. Notwithstanding anything to the contrary in this Section 1, the sale proceeds to which the New Investors would otherwise be entitled by reason of its participation in a sale pursuant to this Section 1 shall be reduced by an amount equal to the product of the New Investors' Co-Sale Fraction multiplied by the sum of any costs, fees and expenses, including, without limitation, attorneys', accountants' and investment bankers' fees and expenses (collectively, "Transaction Costs"), incurred by Samstock in connection with the sale or the exercise of the New Investors' rights under this Section 1. The New Investors shall, as promptly as practicable and as a condition to its participation, enter into such agreements as shall be reasonably requested by Samstock for the sale of its Shares in the proposed sale. Section 2. Drag-Along Rights. If Samstock owns more Company Voting Securities than the New Investors and Samstock enters into an agreement (including an agreement in principle) to sell all of its Shares to any purchaser or group of purchasers (other than any Permitted Assignees or the New Investors), in a single arms-length transaction or related series of arms-length transactions with an independent third party or group of independent third parties, Samstock may require that the New Investors sell all of their Shares to such purchaser or group of purchasers at a net price and on terms and conditions the same as those on which Samstock has agreed to sell its Shares; provided, however, that, notwithstanding the foregoing, prior to the first anniversary of this Agreement, Samstock shall not be entitled to require the New Investors to sell their Shares if the contemplated transaction would result in an internal rate of return for the New Investors on their initial investment of less than 25% unless Samstock makes a cash payment to the New Investors in such amount as to provide the New Investors with an internal rate of return on their initial investment of 25%. Samstock shall give prompt notice to the New Investors that Samstock has entered into an agreement of the type described in this Section 2, and the New Investors shall, as promptly as practicable, enter into such agreements as shall reasonably be requested by Samstock for the sale of all the Shares in the proposed sale. Notwithstanding anything to the contrary in this Section 2, the sale proceeds to which the New Investors would otherwise be entitled by reason of its participation in a sale pursuant to this Section 2 shall be reduced by an amount equal to the product of (i) the percentage of Shares to be sold in the proposed sale owned by the New Investors, multiplied by (ii) the sum of any costs, fees and expenses, including, without limitation, attorneys', accountants' and investment bankers' fees and expenses, incurred by Samstock in connection with the sale or the exercise of Samstock's rights under this Section 2. 2 3 Section 3. Samstock and MP II Board Seat. (a) So long as Samstock is entitled to designate one or two directors in accordance with the provisions of Section 4.4 of the Second Amended and Restated Investment Agreement dated as of June 30, 1999 among the Company, Samstock, EGI-Transmedia Investors, L.L.C., a Delaware limited liability company (formerly known as Transmedia Investors, L.L.C.), and, solely with respect to Section 5 of this agreement, Robert M. Steiner, as trustee under declaration of trust dated March 9, 1983, as amended, establishing the Robert M. Steiner Revocable Trust, each New Investor shall vote all Company Voting Securities owned of record by such New Investor or with respect to which such New Investor has voting control in favor of the election of Samstock's designee or designees to the Company's Board of Directors. (b) So long as MP II is entitled to designate one director in accordance with the provisions of Section 4.4 of the Investment Agreement, Samstock shall vote all Company Voting Securities owned of record by Samstock or with respect to which Samstock has voting control in favor of the election of MP II's designee to the Company's Board of Directors. Section 4. Stockholder Proposal. Samstock shall vote all Company Voting Securities owned of record by Samstock or with respect to which Samstock has voting control in favor of the Proxy Proposal (as defined in the Purchase Agreement). Section 5. Certain Definitions. "Affiliate" means, with respect to a specified Person, any Person that directly or indirectly controls, is controlled by, or is under common control with, the specified Person; "control" means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a Person, whether through ownership of voting securities, by contract or otherwise. "Permitted Assignee" means: (i) with respect to the Transfer of Shares by Samstock, any Affiliate of Samstock or any stockholder, partner or member of any such Affiliate; and (ii) with respect to any Transfer of Shares by any New Investor, any Minotaur Investor. "Person" means an individual, a corporation, a partnership, a limited liability company, a joint venture, an association, a joint-stock company, a trust, a business trust, a government or any agency or any political subdivision, any unincorporated organization or any other entity. "Public Sale" means a bona fide sale of Shares either in "broker's transactions" within the meaning of Section 4(4) of the Securities Act of 1933, as amended, or in transactions directly with a "market maker" as that term is defined in Section 3(a)(38) of the Securities Exchange Act of 1934, as amended. "Shares" means all shares of Company Voting Securities, whether now owned or hereafter acquired. 3 4 "Transfer" means any voluntary or involuntary, direct or indirect, transfer, sale, assignment, donation, pledge, hypothecation, issuance, grant of a security interest in or other disposition or attempted disposition of Shares or any right or interest whatsoever therein, including, without limitation, by operation of law or otherwise, whether with or without consideration or value, and whether for cash, other securities or other property and specifically including any share for share or similar exchange; provided, however, that: (i) any pledge or hypothecation of or grant of security interest in Shares by any New Investor which is either approved by Samstock in writing prior to the pledge, hypothecation or grant of security interest or is effected by Samstock or any Affiliate of Samstock shall not constitute a "Transfer" of Shares for any purpose under this Agreement; and (ii) any Transfer effected as a result of a New Investor's death, pursuant to the laws of descent and distribution, by operation of law or otherwise, to such New Investor's spouse, children, grandchildren, parents, siblings, in-laws, nieces and/or nephews or a trust established for any of their benefit, shall not constitute a "Transfer" of Shares for any purpose under this Agreement, provided each transferee of Shares executes a counterpart to this Agreement, whereupon such transferee shall hold such Shares subject to all of the provisions of this Agreement, as if the transferor were the holder of Shares held by the transferee. Section 6. Notices. All notices, and other communications hereunder shall be in writing and shall be deemed given if delivered personally, sent by documented overnight delivery service or, to the extent receipt is confirmed, facsimile, to the appropriate address or facsimile number set forth below (or at such other address or facsimile number for a party as shall be specified by like notice): if to Samstock: Equity Group Investments, L.L.C. Two N. Riverside Plaza - Suite 600 Chicago, IL 60606 Attention: Rod Dammeyer Fax: (312) 454-0610 with an additional copy to: Equity Group Investments, L.L.C. Two N. Riverside Plaza - Suite 600 Chicago, IL 60606 Attention: Joseph M. Paolucci, Esq. Vice President, Deputy General Counsel Fax: (312) 454-0335 4 5 if to any Investor, at their respective addresses set forth on the signature pages hereto. with an additional copy to: Altheimer & Gray 10 South Wacker Drive, Suite 4000 Chicago, IL 60606 Attention: Michael Altman, Esq. Fax: (312) 715-4800 if to the Company: Transmedia Network Inc. 11900 Biscayne Boulevard Miami, Florida 33181 Attention: Chief Executive Officer Fax: (305) 892-3342 with a copy to: Morgan, Lewis & Bockius LLP 101 Park Avenue New York, New York 10178 Attention: Stephen P. Farrell, Esq. Fax: (212) 309-6273 Section 7. Termination. This Agreement shall terminate and its provisions shall be of no further force and effect if (i) the Minotaur Investors shall, at any time, cease to own in the aggregate Company Voting Securities representing at least five percent (5%) of all Company Voting Securities outstanding or (ii) contemporaneously with the termination of the Purchase Agreement in accordance with Section 7.1 thereof. Section 8. Remedies. Any party having rights under this Agreement may enforce such rights specifically to recover damages caused by reason of any breach of any provision of this Agreement and to exercise all other rights granted by law. The parties agree and acknowledge that money damages may not be an adequate remedy for any breach of the provisions of this Agreement and, accordingly, in addition to all other remedies available to any party, such party may in its sole discretion apply to any court of law or equity of competent jurisdiction for specific performance and/or injunctive relief in order to enforce, or prevent any violation of, the provisions of this Agreement. Section 9. Entire Agreement. This Agreement, together with the Purchase Agreement and the Investment Agreement, constitutes the entire agreement between the parties with respect to the subject matter hereof and shall be binding upon and inure to the benefit of the parties hereto and their respective legal representatives, successors and permitted assigns. Any amendments, or 5 6 alternative or supplementary provisions to this Agreement must be made in writing and duly executed by an authorized representative or agent of each of the parties hereto. Except as contemplated by this Agreement, no Person who is not an original party to this Agreement may become a party hereto without the written consent of each of the parties hereto. Section 10. Non-Waiver. The failure in any one or more instances of a party to insist upon performance of any of the terms, covenants or conditions of this Agreement, to exercise any right or privilege in this Agreement conferred, or the waiver by said party of any breach of any of the terms, covenants or conditions of this Agreement, shall not be construed as a subsequent waiver of any such terms, covenants, conditions, rights or privileges, but the same shall continue and remain in full force and effect as if no such forbearance or waiver had occurred. No waiver shall be effective unless it is in writing and signed by an authorized representative of the waiving party. A breach of any representation, warranty or covenant shall not be affected by the fact that a more general or more specific representation, warranty or covenant was not also breached. Section 11. Counterparts. This Agreement may be executed in multiple counterparts, each of which shall be deemed to be an original, and all such counterparts shall constitute but one instrument. Section 12. Severability. The invalidity of any provision of this Agreement or portion of a provision shall not affect the validity of any other provision of this Agreement or the remaining portion of the applicable provision. Section 13. Applicable Law. This Agreement shall be governed and controlled as to validity, enforcement, interpretation, construction, effect and in all other respects by the internal laws of the State of Delaware applicable to contracts made in that State. Section 14. Binding Effect; Benefit, Non-circumvention. This Agreement shall inure to the benefit of and be binding upon the parties hereto, and their successors and permitted assigns. Nothing in this Agreement, express or implied, is intended to confer on any person other than the parties hereto, and their respective successors and permitted assigns any rights, remedies, obligations or liabilities under or by reason of this Agreement. No New Investor shall take any action, alone or in concert with any other person, to circumvent any of the provisions of this Agreement. Section 15. Assignability. This Agreement shall not be assignable by any party without the prior written consent of each of the other parties; provided, however, that, notwithstanding the foregoing, MP II, ValueVision, Mangone or Bank may assign its or their rights and obligations hereunder to any Permitted Assignee, upon the receipt by the Company of the agreement in writing of any such Permitted Assignee to be bound by the terms this Agreement. Section 16. Headings. The headings contained in this Agreement are for convenience of reference only and shall not affect the meaning or interpretation of this Agreement. Section 17. Joint Action by the New Investors. For purposes of Sections 1 and 2 of this Agreement, MP II, ValueVision, Mangone, Bank and any of their Permitted Transferees shall 6 7 act through a single representative; provided that each of the foregoing shall be entitled to individually determine whether it will exercise its rights under Section 1 hereof. Such representative shall initially be MP II, c/o Paul Lapping and Ed Finnegan, and such representative may be replaced upon notice to the Company by agreement of MP II, ValueVision, Mangone, Bank and any of their Permitted Transferees. 7 8 IN WITNESS WHEREOF, the undersigned have executed this Co-Sale and Voting Agreement as of the day and year first above written. MINOTAUR PARTNERS II, L.P. By: Minotaur Partners II, L.L.C. Its: General Partner By: Minotaur Partners II, Inc. Its: Manager /s/ Edward G. Finnegan, Jr. --------------------------------- By: Edward G. Finnegan, Jr. Its: Principal Address: 150 S. Wacker Drive ------------------------- Suite 470 --------------------------------- Chicago, IL 60606 --------------------------------- VALUEVISION INTERNATIONAL INC. /s/ Richard Barnes --------------------------------- By: Richard Barnes Its: Sup:CFO Address: 6740 Shady Oak. Rd. ------------------------- Eden Prarie, MN 55344 --------------------------------- --------------------------------- --------------------------------- /s/ Dominic Mangone --------------------------------- DOMINIC MANGONE Address: ------------------------- --------------------------------- --------------------------------- /s/ Raymond Bank --------------------------------- RAYMOND BANK Address: P.O. Box #106 ------------------------- Butler, MD 21023 --------------------------------- --------------------------------- SAMSTOCK, L.L.C. /s/ Rod Dammeyer --------------------------------- By: Rod Dammeyer Its: Vice President TRANSMEDIA NETWORK INC. /s/ Gene M. Henderson --------------------------------- By: Gene M. Henderson Its: President and Chief Executive Officer EX-99.12 4 CO-SALE AND VOTING AGREEMENT 1 EXHIBIT 12 CO-SALE AND VOTING AGREEMENT This CO-SALE AND VOTING AGREEMENT ("Agreement") is dated as of April 28, 2000, by and among Transmedia Network Inc., a Delaware corporation (the "Company"), Samstock, L.L.C., a Delaware limited liability company ("Samstock"), and each of the investors listed on the signature pages hereto (collectively, the "New Investors"). Capitalized terms used and not otherwise defined in this Agreement have the meanings ascribed to them in Section 4 hereof. R E C I T A L S WHEREAS, reference is hereby made to: (i) that certain Stock Purchase and Sale Agreement, dated as of April 28, 2000, (the "Purchase Agreement") among the Company and the New Investors, pursuant to which the New Investors agreed to purchase from the Company, and the Company has agreed to sell to the New Investors, (a) an aggregate of 657,536 newly issued shares of common stock of the Company, par value $.02 per share (the "Common Stock"), and (b) warrants to purchase an additional 1,315,072 shares of Common Stock in the aggregate; and (ii) that certain Investment Agreement, dated as of even date herewith, among the Company and the New Investors other than Samstock (the "Investment Agreement"). Capitalized terms used and not defined in this Agreement shall have the meanings ascribed to them in the Investment Agreement. WHEREAS, the parties desire to establish certain rights and restrictions related to the transfer of Shares. A G R E E M E N T NOW, THEREFORE, in consideration of the foregoing, and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereby agree as follows: Section 1. Co-Sale Rights. In the event that Samstock enters into an agreement to sell to any independent third party or group of independent third parties, in a single transaction or related series of transactions, other than a Public Sale, such number of Shares as equals or exceeds more than ten percent (10%) of the Shares held by Samstock, Samstock shall first notify the New Investors in writing, of the identity of the proposed purchaser(s), the number of Shares proposed to be sold, the proposed purchase price and terms of sale and an estimate of the Transaction Costs (as defined below) (which estimate shall not be binding on Samstock and shall have no effect on Samstock's or the New Investors' rights or obligations under this Section 1). The New Investors thereupon shall have the right to participate in the proposed sale at the same net price per share and other terms of sale as offered to Samstock; provided, however, that the New Investors' right to participate in the proposed sale shall be subordinate to the rights of (A) the Stockholder (as such term is defined in each of (i) the Amended and Restated Agreement Among Stockholders (the "Agreement Among Stockholders") dated as of March 3, 1998, by and 2 among Samstock, EGI-Transmedia Investors, L.L.C., a Delaware limited liability company (formerly known as Transmedia Investors, L.L.C., "TNI"), Stockholder and the Company, and (ii) the Stockholders' Agreement ("Stockholders' Agreement") dated as of March 3, 1998, by and among Samstock, TNI, Stockholder and the Company) and (B) the investors (the "Minotaur Investors") named in that certain Co-Sale and Voting Agreement (the "Minotaur Co-Sale and Voting Agreement") dated as of April 28, 2000, by and among the Company, Samstock, Minotaur Partners II, L.P., an Illinois limited partnership, Dominic Mangone and Raymond Bank), to participate in the proposed sale. In order to exercise its co-sale rights, the New Investors, within ten (10) business days after receiving notice from Samstock, shall deliver to Samstock a written election to participate in the sale to the extent allowed by this Section 1. If the New Investors have elected to participate in the proposed sale, the New Investors shall be entitled to sell in the proposed sale a number of Shares equal to the product of (i) the quotient (the "Co-Sale Fraction") determined by dividing the number of Shares owned by the New Investors by the aggregate number of Shares owned by the New Investors and Samstock multiplied by (ii) (a) the total number of Shares to be sold by them in the proposed sale less (b) the total number of Shares that Stockholder and/or the Minotaur Investors shall have elected to sell pursuant to the co-sale rights granted to Stockholder in each of the Agreement Among Stockholders, the Stockholders' Agreement and the Minotaur Co-Sale and Voting Agreement. Notwithstanding anything to the contrary in this Section 1, the sale proceeds to which the New Investors would otherwise be entitled by reason of its participation in a sale pursuant to this Section 1 shall be reduced by an amount equal to the product of the New Investors' Co-Sale Fraction multiplied by the sum of any costs, fees and expenses, including, without limitation, attorneys', accountants' and investment bankers' fees and expenses (collectively, "Transaction Costs"), incurred by Samstock in connection with the sale or the exercise of the New Investors' rights under this Section 1. The New Investors shall, as promptly as practicable and as a condition to its participation, enter into such agreements as shall be reasonably requested by Samstock for the sale of its Shares in the proposed sale. Section 2. Drag-Along Rights. If Samstock owns more Company Voting Securities than the New Investors and Samstock enters into an agreement (including an agreement in principle) to sell all of its Shares to any purchaser or group of purchasers (other than any Permitted Assignees or the New Investors), in a single arms-length transaction or related series of arms-length transactions with an independent third party or group of independent third parties, Samstock may require that the New Investors sell all of their Shares to such purchaser or group of purchasers at a net price and on terms and conditions the same as those on which Samstock has agreed to sell its Shares; provided, however, that, notwithstanding the foregoing, prior to the first anniversary of this Agreement, Samstock shall not be entitled to require the New Investors to sell their Shares if the contemplated transaction would result in an internal rate of return for the New Investors on their initial investment of less than 25% unless Samstock makes a cash payment to the New Investors in such amount as to provide the New Investors with an internal rate of return on their initial investment of 25%. Samstock shall give prompt notice to the New Investors that Samstock has entered into an agreement of the type described in this Section 2, and the New Investors shall, as promptly as practicable, enter into such agreements as shall reasonably be requested by Samstock for the sale of all the Shares in the proposed sale. Notwithstanding anything to the contrary in this Section 2, the sale proceeds to which the New Investors would otherwise be entitled by reason of its participation in a sale pursuant to this Section 2 shall be reduced by an amount equal to the product of (i) the percentage of Shares to be sold in the proposed sale owned by the New Investors, multiplied by (ii) the sum of any costs, fees and expenses, including, without limitation, attorneys', accountants' and investment 3 bankers' fees and expenses, incurred by Samstock in connection with the sale or the exercise of Samstock's rights under this Section 2. Section 3. Stockholder Proposal. Samstock shall vote all Company Voting Securities owned of record by Samstock or with respect to which Samstock has voting control in favor of the Proxy Proposal (as defined in the Purchase Agreement). Section 4. Certain Definitions. "Affiliate" means, with respect to a specified Person, any Person that directly or indirectly controls, is controlled by, or is under common control with, the specified Person; "control" means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a Person, whether through ownership of voting securities, by contract or otherwise. "Permitted Assignee" means: (i) with respect to the Transfer of Shares by Samstock, any Affiliate of Samstock or any stockholder, partner or member of any such Affiliate; and (ii) with respect to any Transfer of Shares by any New Investor, any Management Investor. "Person" means an individual, a corporation, a partnership, a limited liability company, a joint venture, an association, a joint-stock company, a trust, a business trust, a government or any agency or any political subdivision, any unincorporated organization or any other entity. "Public Sale" means a bona fide sale of Shares either in "broker's transactions" within the meaning of Section 4(4) of the Securities Act of 1933, as amended, or in transactions directly with a "market maker" as that term is defined in Section 3(a)(38) of the Securities Exchange Act of 1934, as amended. "Shares" means all shares of Company Voting Securities, whether now owned or hereafter acquired. "Transfer" means any voluntary or involuntary, direct or indirect, transfer, sale, assignment, donation, pledge, hypothecation, issuance, grant of a security interest in or other disposition or attempted disposition of Shares or any right or interest whatsoever therein, including, without limitation, by operation of law or otherwise, whether with or without consideration or value, and whether for cash, other securities or other property and specifically including any share for share or similar exchange; provided, however, that: (i) any pledge or hypothecation of or grant of security interest in Shares by any New Investor which is either approved by Samstock in writing prior to the pledge, hypothecation or grant of security interest or is effected by Samstock or any Affiliate of Samstock shall not constitute a "Transfer" of Shares for any purpose under this Agreement; and 4 (ii) any Transfer effected as a result of a New Investor's death, pursuant to the laws of descent and distribution, by operation of law or otherwise, to such New Investor's spouse, children, grandchildren, parents, siblings, in-laws, nieces and/or nephews or a trust established for any of their benefit, shall not constitute a "Transfer" of Shares for any purpose under this Agreement, provided each transferee of Shares executes a counterpart to this Agreement, whereupon such transferee shall hold such Shares subject to all of the provisions of this Agreement, as if the transferor were the holder of Shares held by the transferee. Section 5. Notices. All notices, and other communications hereunder shall be in writing and shall be deemed given if delivered personally, sent by documented overnight delivery service or, to the extent receipt is confirmed, facsimile, to the appropriate address or facsimile number set forth below (or at such other address or facsimile number for a party as shall be specified by like notice): if to Samstock: Equity Group Investments, L.L.C. Two N. Riverside Plaza - Suite 600 Chicago, IL 60606 Attention: Rod Dammeyer Fax: (312) 454-0610 with an additional copy to: Equity Group Investments, L.L.C. Two N. Riverside Plaza - Suite 600 Chicago, IL 60606 Attention: Joseph M. Paolucci, Esq. Vice President, Deputy General Counsel Fax: (312) 454-0335 if to any Investor, at their respective addresses set forth on the signature pages hereto. with an additional copy to: -------------------------------- -------------------------------- -------------------------------- if to the Company: Transmedia Network Inc. 11900 Biscayne Boulevard Miami, Florida 33181 Attention: Chief Executive Officer Fax: (305) 892-3342 with a copy to: Morgan, Lewis & Bockius LLP 101 Park Avenue New York, New York 10178 Attention: Stephen P. Farrell, Esq. Fax: (212) 309-6273 5 Section 6. Termination. This Agreement shall terminate and its provisions shall be of no further force and effect if (i) the Management Investors shall, at any time, cease to own in the aggregate Company Voting Securities representing at least five percent (5%) of all Company Voting Securities outstanding or (ii) contemporaneously with the termination of the Purchase Agreement in accordance with Section 7.1 thereof. Section 7. Remedies. Any party having rights under this Agreement may enforce such rights specifically to recover damages caused by reason of any breach of any provision of this Agreement and to exercise all other rights granted by law. The parties agree and acknowledge that money damages may not be an adequate remedy for any breach of the provisions of this Agreement and, accordingly, in addition to all other remedies available to any party, such party may in its sole discretion apply to any court of law or equity of competent jurisdiction for specific performance and/or injunctive relief in order to enforce, or prevent any violation of, the provisions of this Agreement. Section 8. Entire Agreement. This Agreement, together with the Purchase Agreement and the Investment Agreement, constitutes the entire agreement between the parties with respect to the subject matter hereof and shall be binding upon and inure to the benefit of the parties hereto and their respective legal representatives, successors and permitted assigns. Any amendments, or alternative or supplementary provisions to this Agreement must be made in writing and duly executed by an authorized representative or agent of each of the parties hereto. Except as contemplated by this Agreement, no Person who is not an original party to this Agreement may become a party hereto without the written consent of each of the parties hereto. Section 9. Non-Waiver. The failure in any one or more instances of a party to insist upon performance of any of the terms, covenants or conditions of this Agreement, to exercise any right or privilege in this Agreement conferred, or the waiver by said party of any breach of any of the terms, covenants or conditions of this Agreement, shall not be construed as a subsequent waiver of any such terms, covenants, conditions, rights or privileges, but the same shall continue and remain in full force and effect as if no such forbearance or waiver had occurred. No waiver shall be effective unless it is in writing and signed by an authorized representative of the waiving party. A breach of any representation, warranty or covenant shall not be affected by the fact that a more general or more specific representation, warranty or covenant was not also breached. Section 10. Counterparts. This Agreement may be executed in multiple counterparts, each of which shall be deemed to be an original, and all such counterparts shall constitute but one instrument. 6 Section 11. Severability. The invalidity of any provision of this Agreement or portion of a provision shall not affect the validity of any other provision of this Agreement or the remaining portion of the applicable provision. Section 12. Applicable Law. This Agreement shall be governed and controlled as to validity, enforcement, interpretation, construction, effect and in all other respects by the internal laws of the State of Delaware applicable to contracts made in that State. Section 13. Binding Effect; Benefit, Non-circumvention. This Agreement shall inure to the benefit of and be binding upon the parties hereto, and their successors and permitted assigns. Nothing in this Agreement, express or implied, is intended to confer on any person other than the parties hereto, and their respective successors and permitted assigns any rights, remedies, obligations or liabilities under or by reason of this Agreement. No New Investor shall take any action, alone or in concert with any other person, to circumvent any of the provisions of this Agreement. Section 14. Assignability. This Agreement shall not be assignable by any party without the prior written consent of each of the other parties; provided, however, that, notwithstanding the foregoing, any Investor may assign its or their rights and obligations hereunder to any Permitted Assignee, upon the receipt by the Company of the agreement in writing of any such Permitted Assignee to be bound by the terms this Agreement. Section 15. Headings. The headings contained in this Agreement are for convenience of reference only and shall not affect the meaning or interpretation of this Agreement. Section 16. Joint Action by the New Investors. For purposes of Sections 1 and 2 of this Agreement, each of the New Investors and any of their Permitted Transferees shall act through a single representative; provided that each of the foregoing shall be entitled to individually determine whether it will exercise its rights under Section 1 hereof. Such representative shall initially be ______________________________, and such representative may be replaced upon notice to the Company by agreement of the New Investors and any of their Permitted Transferees. 7 IN WITNESS WHEREOF, the undersigned have executed this Co-Sale and Voting Agreement as of the day and year first above written. THE PURCHASERS: /s/ Gene M. Henderson ------------------------------------- GENE M. HENDERSON Address: Transmedia ----------------------------- 11900 Biscayne Blvd, #460 ------------------------------------- N. Miami, FL 33182 ------------------------------------- /s/ Herbert M. Gardner ------------------------------------- HERBERT M. GARDNER Address: 26 Broadway 8472 ----------------------------- New York, NY 10004 ------------------------------------- On behalf of myself and certain family members. ------------------------------------- /s/ James M. Callaghan ------------------------------------- JAMES M. CALLAGHAN Address: 15 Club Court ----------------------------- Plesantville, New York 10570 ------------------------------------- ------------------------------------- /s/ Gregory J. Robitalle ------------------------------------- GREGORY J. ROBITAILLE Address: 1332 W. Henderson St. ----------------------------- Chicago, IL 60657 ------------------------------------- ------------------------------------- /s/ John A. Ward ------------------------------------- JOHN A. WARD Address: 830 Paris Avenue ----------------------------- New York, NY 10021 ------------------------------------- ------------------------------------- /s/ George S. Weidemann ------------------------------------- GEORGE S. WEIDEMANN Address: 125 Brookside Drive ----------------------------- Greenwich, CT 06831 ------------------------------------- ------------------------------------- 8 /s/ Christine M. Donohoo ------------------------------------- CHRISTINE M. DONOHOO Address: 6807 Seton HouseLane ----------------------------- Charlotte, NC 28275 ------------------------------------- ------------------------------------- /s/ Frank F. Schmeyer ------------------------------------- FRANK F. SCHMEYER Address: 30 Stevens Dr. ----------------------------- Englewood Cliffs, NJ ------------------------------------- ------------------------------------- /s/ Elliot Merberg ------------------------------------- ELLIOT MERBERG Address: 515 72nd St. Apt. 23C ----------------------------- New York, NY 10021 ------------------------------------- On behalf of myself and certain family members. ------------------------------------- /s/ Gerald Fleischman ------------------------------------- GERALD FLEISCHMAN Address: 7997 Travelers Tree Dr. ----------------------------- Boca Raton, FL 33433 ------------------------------------- ------------------------------------- /s/ Thomas J. Litle ------------------------------------- THOMAS J. LITLE Address: C/O Ordertrust ----------------------------- 900 Chelmsford Street ------------------------------------- Lowell, MA 01851 ------------------------------------- 9 COMPANY: TRANSMEDIA NETWORK INC. /s/ Gene M. Henderson ------------------------------------- By: Gene M. Henderson, President and Chief Executive Officer Transmedia 11900 Biscayne Blvd. #460 N. Miami, Fl 33182 SAMSTOCK, L.L.C. /s/ Rod Dammeyer ------------------------------------- By: Rod Dammeyer Its: Vice President Address: 2 N. Riverside Plaza ---------------------------- Chicago, IL 60606 ------------------------------------- EX-99.13 5 PRESS RELEASE DATED MAY 2, 2000 1 EXHIBIT 13 [iDINE NEWSLETTER] [iDINE LOGO] CONTACT: Susan Schneider (847) 438-4466 sschneider@iDINE.com FOR IMMEDIATE RELEASE NEW INTERNET VENTURE REDEFINES DINING -- FIRST TO INTRODUCE YIELD MANAGEMENT AND FREQUENT DINING LOYALTY PROGRAMS FOR RESTAURANTS CHICAGO FIRMS LEAD INVESTMENT (CHICAGO, May 2, 2000) - iDine.com announced today that it is establishing a new internet dining venture that will redefine the way restaurants attract customers and the way consumers choose restaurants. Chicago-based Minotaur Partners is the lead investor in the new entity. "Applying the same fundamental principles that changed the airline industry, iDine.com intends to transform the restaurant industry by offering dynamic promotions, yield management and loyalty tools to drive incremental business," says Greg Robitaille, president and chief executive officer for iDine.com. "Similarly, it will become to diners what frequent flyer programs have become to air travelers," he adds. iDine.com is designed to enable restaurant operators to fill empty tables by delivering restaurant-controlled promotions and incentives to consumers. The unique service will also enable each restaurant to leverage its existing credit card processing system, track dining activity, and seamlessly deliver rewards to consumers. Unlike other online dining tools, iDine.com's compensation will be performance-based; restaurateurs will pay only when consumers dine in their restaurants. iDine.com's comprehensive website will let consumers browse restaurant listings based on varying criteria, make online reservations, and earn never-before-offered rewards from dining at participating restaurants. (MORE) 2 iDINE.COM PAGE 2 RESTAURANTS SET REWARDS TO FILL EMPTY TABLES, MARKET TO CONSUMERS The iDine.com concept is to increase restaurant revenues by providing variable pricing, yield management and customer relationship management (CRM) tools and solutions. In doing so, the company will: - let restaurants continuously adjust rewards based on demand conditions, and place control of the consumer offering directly into the hands of the restaurateur; - offer restaurants the ability to fill empty seats during typically under-performing day parts; and - allow restaurants to target-promote to selected customer segments and engage in one-to-one marketing. Each restaurateur will set the parameters for the variable incentives offered through iDine.com and simply "post" the desired level of incentives using phone, fax, email or through iDine.com's secure web site. COMPREHENSIVE REWARDS-BASED DINING SITE FOR FREQUENT DINERS As the most extensive internet resource for up-to-date dining information, iDine.com intends to be a trusted advisor to frequent diners by providing fine and casual dining restaurant listings; the ability to search based on varying criteria (i.e., cuisine, location, price); restaurant profiles (menus, photos, average cost); ratings and reviews; directions and mapping assistance; online reservation capabilities; and dynamic promotions and special offers. Consumers will choose from a variety of reward types including iDine.com-branded loyalty program "points," frequent flyer miles, restaurant gift certificates, and cash-off dining. The website will empower frequent diners by offering a mechanism to provide feedback to restaurants based on their dining experiences. iDINE.COM CORPORATE STRUCTURE, SPONSORSHIP AND MANAGEMENT iDine.com is a wholly owned subsidiary of Transmedia Network, Inc., a leader in dining savings programs. iDine.com will operate independently but will have access to Transmedia's offline assets and capabilities - its merchant base of more than 10,000 restaurants, its more than (MORE) 3 iDINE.COM PAGE 3 2.5 million card members, and its proprietary credit card transaction processing platform - providing an established initial audience base and enabling it to deliver restaurant-controlled incentives to consumers seamlessly. Chicago-based investor Minotaur Partners will fund iDine.com initially. "The Transmedia/iDine.com opportunity seemed to us to be a highly logical `clicks and mortar' business strategy that we think is very significant," said Bill Lederer, chairman and chief executive officer of Minotaur Partners. iDine.com will receive additional financing from Merchant Partners and Sam Zell's Equity Group Investments. The sale of shares and warrants will be consummated in two steps of $4 million initially and $6 million subject to near-term shareholder approval. Robitaille, who previously served as managing director for Equity Group Investments, and worked closely with Transmedia management during the past two years, will lead iDine.com's dedicated management team. Most recently, he managed the successful integration of the Dining a la Card operation into Transmedia. ROLLOUT UNDERWAY; 3Q SITE LAUNCH PLANNED iDine.com plans aggressive sales and marketing efforts aimed at both restaurants and consumers, to include trade and consumer online and offline initiatives, direct sales and marketing campaigns aimed at Transmedia members and merchants, affiliate programs with online portals and rewards partners, and national sales consultants in top markets. The company expects to launch its new website in the early third quarter. ABOUT iDINE.COM Chicago-based iDine.com, a wholly owned subsidiary of Transmedia Network, Inc. (NYSE: TMN), will offer sophisticated yield management and loyalty reward services to restaurants. For consumers, iDine.com's goal is to become the most reliable and comprehensive rewards-based on-line resource for helping consumers make smart and savvy dining decisions. (MORE) 4 iDINE.COM PAGE 4 ABOUT MINOTAUR Minotaur Partners is part of Minotaur Capital Management, Inc., a privately held merchant bank with a focus on Midwest-based, New Economy investments. William A. Lederer, Chairman, CEO and Chief Investment Officer leads the firm, founded in 1987 and located in Chicago, IL. A team of seasoned professionals with extensive operating and investment experience joins Lederer. Minotaur uses a hands-on approach to deliver superior, risk-adjusted returns and successful outcomes for both its investors and portfolio companies. Portfolio companies are selected using Economic Value Investing(SM), Minotaur's rigorous and proprietary evaluation and monitoring process. Additional information about Minotaur and its portfolio companies can be found at www.minotaurpartners.com. # # # Any portion of information presented by iDine.com or Transmedia that relates to future plans, events, developments or performance are forward-looking statements. Readers of this document and visitors to our web site are cautioned that all such statements and information involve risks and uncertainties as discussed in detail in the Company's filings with the United States Securities and Exchange Commission. Actual results, events, developments or performances may differ materially. The public is cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date posted. The Company undertakes no obligation to post the results of any revisions to any forward-looking statements that may be made to reflect events or circumstances after the date posted in this document or on the web site, or to reflect the occurrence of unanticipated events. -----END PRIVACY-ENHANCED MESSAGE-----