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EXHIBIT 99.5
SHAREHOLDER AGREEMENT
THIS SHAREHOLDER AGREEMENT (the "Agreement") is made and entered into
as of April 23, 2001, by and between The Xxxxxxxx Companies, Inc., a Delaware
corporation ("Xxxxxxxx") and Xxxxxxxx Communications Group, Inc., a Delaware
corporation (the "Company").
On February 26, 2001, Xxxxxxxx transferred certain assets to the
Company and in exchange for such assets, Xxxxxxxx received 24,265,892 shares of
newly issued Common Stock (as defined below) and other consideration. Xxxxxxxx
also owns 395,434,965 shares of Common Stock. Concurrently herewith, Xxxxxxxx is
distributing 398,500,000 shares of Common Stock to its stockholders of record as
of April 9, 2001 (the "Spin-Off"). Xxxxxxxx has committed to the Internal
Revenue Service that Xxxxxxxx will dispose of all the remaining 21,200,857
shares of Common Stock that it holds as of the date of this Agreement (the
"Retained Stock") as soon as market conditions allow, but in any event not
longer than five years after the date of the Spin-Off.
The parties hereby agree as follows:
1. DEFINITIONS
"10% LIMIT" shall mean 10% of the total number of issued and
outstanding shares of Common Stock calculated on a Fully-Diluted Basis after
giving effect to any concurrent transaction and the issuance of shares of Common
Stock to Xxxxxxxx.
"33 ACT" means the Securities Act of 1933, as amended, or any similar
federal law then in force, and the rules and regulations promulgated thereunder.
"34 ACT" means the Securities Exchange Act of 1934, as amended, or any
similar federal law then in force, and the rules and regulations promulgated
thereunder.
"AFFILIATE" has the meaning ascribed to it in Rule 12b-2 under the 34
Act.
"BLUE SKY" means laws providing for the regulation and supervision of
securities offerings and sales as in effect in various states of the United
States.
"BOARD OF DIRECTORS" means the board of directors of the Company.
"BUSINESS DAY" means a day other than a Saturday or Sunday or a day on
which banking institutions are authorized or required by law or executive order
to remain closed in Tulsa, Oklahoma.
"COMMISSION" means the Securities and Exchange Commission.
"COMMON STOCK" means all the common stock, $.01 par value per share, of
the Company.
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"COMPANY CONTROL PERSON" shall have the meaning set forth in Section
8.02 to this Agreement.
"CONTROL PERSON" shall have the meaning set forth in Section 8.01 to
this Agreement.
"DEMAND REGISTRATION" shall have the meaning set forth in Section 2.01
to this Agreement.
"DULY ENDORSED" means (i) duly endorsed in blank by the person or
persons in whose name a stock certificate or certificate representing a debt
security is registered or (ii) accompanied by a duly executed stock or security
assignment separate from the certificate, in each case with the signature(s)
thereon guaranteed by a commercial bank or trust company or a member of a
national securities exchange or of the National Association of Securities
Dealers, Inc.
"FULLY-DILUTED BASIS" means, with respect to any calculation of the
outstanding amount of common equity of the Company, an amount equal to the total
outstanding number of shares of Common Stock, calculated without duplication and
assuming the conversion of all outstanding shares of convertible capital stock
and securities of the Company and the exercise of all warrants, options and
other rights (including, without limitation, employee stock options pursuant to
any stock option plan of the Company (except that, with respect to such options
and warrants, if any such options are finally determined to be less than 100%
vested or if any such warrants are finally determined to be less than 100%
exercisable, only those shares of Common Stock which may be exercised following
such final determination shall be included in such calculation)) to purchase
shares of Common Stock.
"HOLDER" means a holder of Registrable Securities. A person is deemed
to be a Holder of Registrable Securities whenever such person owns Registrable
Securities; provided, however, that unless the Company is otherwise notified by
the Holder of a Registrable Security, the Holder of a Registrable Security shall
be deemed to be that person set forth on the books and records of the Company or
the registrar for such Registrable Securities.
"INSPECTORS" means collectively any Holder, any underwriter
participating in any disposition pursuant to a Registration Statement and any
attorney, accountant or other professional retained by any such Holder or
underwriter.
"MAJORITY HOLDERS" means the holder or holders of a majority of the
Registrable Securities to be registered under a Registration Statement.
"OTHER SELLING HOLDERS" means all persons and entities other than
Xxxxxxxx who have been granted registration rights by the Company.
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"PERSON" means an individual, a partnership, a corporation, a limited
liability company, a limited liability partnership, an association, a joint
stock company, a trust, a joint venture, an unincorporated organization and a
governmental entity or any department, agency or political subdivision thereof.
"RECORDS" means all financial and other records, pertinent corporate
documents and properties of the Company.
"REGISTRABLE SECURITIES" means all shares of Retained Stock held at the
relevant time by Xxxxxxxx or any affiliated transferee or assignee of Common
Stock previously held by Xxxxxxxx (provided that pursuant to such transfer or
assignment Xxxxxxxx has specifically assigned certain of its rights hereunder),
and any other issued or issuable shares of Common Stock held by Xxxxxxxx at the
relevant time, either at the time of initial issuance or subsequently, by way of
a stock dividend or stock split or in connection with a combination of shares,
recapitalization, merger, consolidation or other reorganization. As to any
particular Registrable Securities, such securities will cease to be Registrable
Securities (i) when they have been transferred in a public offering registered
under the 33 Act or in a sale made through a broker, dealer or market-maker
pursuant to Rule 144 under the 33 Act or (ii) when any Holder requests in
writing that such Registrable Securities not be registered pursuant to the terms
of this Agreement.
"REGISTRATION EXPENSES" means (i) registration and filing fees, (ii)
fees and expenses of compliance with securities or Blue Sky laws (including
reasonable fees and disbursements of counsel in connection with Blue Sky
qualifications of the Registrable Securities), (iii) printing, mailing and
delivery expenses, (iv) internal expenses (including, without limitation, all
salaries and expenses of its officers and employees performing legal or
accounting duties), (v) the fees and expenses incurred in connection with the
listing of the Registrable Securities, (vi) reasonable fees and disbursements of
counsel for the Company and customary fees and expenses for independent
certified public accountants of a comfort letter or comfort letters), (vii) the
reasonable fees and disbursements of one counsel retained by or for the benefit
of all of the holders of Registrable Securities (determined by the Selling
Holders of such securities in any manner in which they collectively choose),
(viii) the reasonable fees and expenses of any special experts retained by the
Company in connection with such registration and (ix) the reasonable fees and
expenses of any transfer agents and registrars of the Registrable Securities, as
selected by the Company; provided, however, the Company shall not have any
obligation to pay any underwriting fees, discounts or commissions attributable
to the sale of Registrable Securities, or, except as provided by clause (ii)
above, any out-of-pocket expenses of the Holders (or the agents who manage their
accounts) or the fees and disbursements of counsel for any underwriter.
"REGISTRATION STATEMENT" means a registration statement on Form S-3 or
another appropriate form filed by the Company during the period that this
Agreement is in effect.
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"RIGHT OF FIRST OFFER NOTICE" shall have the meaning set forth in
Section 7.04(a) to this Agreement.
"RULE 144" means Rule 144 issued under the 33 Act or other comparable
provision that may be adopted by the Commission.
"RULE 145" means Rule 145 issued under the 33 Act or other comparable
provision that may be adopted by the Commission.
"SELLING HOLDER" means, with respect to any Registration Statement, any
Holder whose securities are included therein.
"SEPARATION AGREEMENT" shall have the meaning set forth in Section 9.09
to this Agreement.
"SUBSIDIARY" or "SUBSIDIARIES" of any Person means any corporation or
other entity of which securities or other ownership interests having ordinary
voting power to elect a majority of the board of directors or other Persons
performing similar functions are at the time directly or indirectly owned or
controlled by such Person or one or more Subsidiaries of such Person.
"THIRD PARTY" means, with respect to Xxxxxxxx or the Company, any
Person other than Xxxxxxxx' or the Company's Affiliates, respectively; provided
further, that the Transfer to any such Person is in compliance with all
applicable federal, state and foreign securities laws.
"TRANSFER" means any direct or indirect sale, assignment, mortgage,
transfer, pledge, gift, hypothecation or other disposition of or transfer of
Common Stock.
"TRANSFER OFFER" shall have the meaning set forth in Section 7.04(a) to
this Agreement.
"TRANSFER STOCK" shall have the meaning set forth in Section 7.04(a) to
this Agreement.
"VOLUME-WEIGHTED AVERAGE TRADING PRICE" shall mean, for any day on
which the New York Stock Exchange is open for trading, an amount equal to (a)
the cumulative sum, for each trade of Common Stock (or other class or series of
capital stock) during such trading day on the New York Stock Exchange (or, if
such security is not listed on the New York Stock Exchange, such other principal
exchange or over-the-counter market on which such security is listed), of the
product of: (i) the sale price times (ii) the number of shares of Common Stock
(or such other class or series of capital stock) sold at such price, divided by
(b) the total number of shares of Common Stock (or such other class or series of
capital stock) so traded during the trading day.
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2. REGISTRATION RIGHTS
2.01 DEMAND REGISTRATION RIGHTS. Within ninety (90) days after the written
notice of a Holder requesting registration, the Company shall file with the
Commission a Registration Statement (a "Demand Registration") under the 33 Act
covering all or part of then outstanding Registrable Securities, and shall use
its reasonable efforts to cause the Registration Statement to become effective
as soon as practicable; provided, however, that the Company shall not be
obligated to effect any such registration, qualification or compliance pursuant
to this Section 2.01: (i) if the Selling Holders propose to sell Registrable
Securities and such other securities (if any) representing less than the larger
of (x) 1,000,000 shares of the Company's Common Stock, or (y) $50,000,000 of
shares (determined using the Volume-Weighted Average Trading Price); or (ii) if
the Company has, within the six (6) month period preceding the date of such
request, already effected a registration under the 33 Act other than a
registration from which the Registrable Securities of Selling Holders have been
excluded (with respect to all or any portion of the Registrable Securities the
Selling Holders requested be included in such registration) pursuant to the
provisions of Section 2.02.
(a) NUMBER OF DEMAND REGISTRATIONS. The Company shall be required to
effect, pursuant to this Section 2.01, registrations with respect to
Registrable Securities requested by Xxxxxxxx, so long as Xxxxxxxx
beneficially owns in the aggregate at least three percent of the issued
and outstanding shares of the Company's Common Stock Registrable
Securities.
(b) PRIORITY ON DEMAND REGISTRATIONS. In the event that a Demand
Registration is an underwritten offering, and the managing underwriters
advise Xxxxxxxx in writing that in their opinion the number of
Registrable Securities, the Company's securities, and any other
securities requested to be included exceeds the number that can be sold
in such offering without adversely affecting such underwriters' ability
to effect an orderly distribution of such securities (including the
price thereof), the Company will include in such registration: (i)
first, the number of Registrable Securities requested to be included by
Xxxxxxxx; (ii) second, the number of Registrable Securities requested
to be included by any other Holder; (iii) third, if all the Registrable
Securities requested to be included are included in such registration,
the number of the Company's securities requested to be included that,
in the opinion of such underwriters, can be sold; and (iv) fourth, if
all Registrable Securities and the Company's securities requested to be
included are included in such registration, any other securities
requested to be included in such registration that, in the opinion of
such underwriters, can be sold.
(c) DEFERRAL OF REGISTRATIONS. The Company may be allowed to defer
filing of a Registration Statement: (A) if the president or general
counsel of the Company reasonably determines in good faith that it is
in the best interests of the Company not to disclose the existence of
or facts surrounding any proposed or pending material developments; (B)
if the underwriters have notified the
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Company that market conditions are such as to recommend deferral; (C)
pending the completion of year-end financial statements or quarterly
earnings releases; or (D) if an offering by the Company of any
securities is pending; provided, however, that any deferral pursuant to
clauses (A)-(D) of this paragraph shall not in the aggregate be for
more than 60 days.
2.02 PIGGYBACK REGISTRATIONS.
(a) RIGHT TO PIGGYBACK. Whenever the Company proposes to register any of its
Common Stock (whether for its own account or the account of others) under the 33
Act (other than pursuant to a Demand Registration) and the registration form to
be used is suitable for the registration of Registrable Securities (a "Piggyback
registration"), the Company will give prompt written notice of the proposed
registration to each Holder and, subject to the priority provisions of Section
2.02(b), will include in such registration all Registrable Securities with
respect to which the Company has received written requests for inclusion therein
within 30 days after receipt of such notice, provided, however, that (i) the
Company will not be required to effect a Piggyback Registration if it is
registering securities in connection with an employee stock option plan, a
merger, exchange offer or another transaction of the type specified in Rule 145
and (ii) the Company may withdraw any proposed Registration Statement or
offering of securities under this Section at any time without liability to any
Holder, in which case the Company will not be required to effect a registration,
unless such Holder converts its request into a Demand Registration.
(b) PRIORITY ON PRIMARY REGISTRATIONS. In the event that a Piggyback
Registration is in connection with an underwritten primary offering of the
Company's securities and the managing underwriters advise the Company in writing
that in their opinion the number of securities requested to be included in such
registration exceeds the number that can be sold in such offering without
adversely affecting such underwriters' ability to effect an orderly distribution
of such securities, the Company will include in such registration: (i) first,
the Company's securities proposed to be sold by the Company; (ii) second, the
number of Registrable Securities requested to be included that, in the opinion
of such underwriters, can be sold, pro rata among the Holders of such securities
on the basis of the amount of Registrable Securities then owned by each such
Holder; and (iii) third, if all Registrable Securities requested to be included
are included in such registration, any other securities requested to be included
in such registration that, in the opinion of such underwriters, can be sold.
(c) PRIORITY ON OTHER REGISTRATIONS. In the event that a Piggyback Registration
is in connection with an underwritten offering of the Company's securities
pursuant to the exercise of registration rights by a stockholder of the Company
who is not a Holder hereunder and the managing underwriters advise the Company
in writing that in their opinion the number of securities requested to be
included in such registration exceeds the number that can be sold in such
offering without adversely affecting such underwriters' ability to effect an
orderly distribution of such securities, the Company will include in such
registration: (i) first, the shares of the Company's Common Stock requested to
be registered by such Company stockholder pursuant to the exercise of its
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registration rights, (ii) second, any of the Company's securities proposed to be
sold by the Company in such offering; (iii) third, the number of Registrable
Securities requested to be included that, in the opinion of such underwriters,
can be sold pro rata among the Holders of such securities on the basis of the
amount of Registrable Securities then owned by each such Holder; and (iv)
fourth, if all Registrable Securities requested to be included are included in
such registration, any other securities requested to be included in such
registration that, in the opinion of such underwriters, can be sold.
(d) CONDITION TO PIGGYBACK REGISTRATIONS. Registrable Securities and any other
securities registered in a Piggyback Registration shall be offered to the public
at no less than the price at which other equivalent securities of the Company
then registered are offered to the public.
3. HOLDBACK AGREEMENT. To the extent not inconsistent with applicable law, each
Holder agrees not to effect any sale or distribution of any securities of the
issue being registered or any securities similar to those being registered, or
any securities convertible into or exchangeable or exercisable for such
securities, including a sale pursuant to Rule 144, during the ten (10) business
days prior to, and during the 90-day period beginning on, the effective date of
such Registration Statement (except as part of such registration), if and to the
extent timely notified in writing by the managing underwriter or underwriters in
the case of an underwritten public offering.
4. SELECTION OF UNDERWRITERS. At the option of the Majority Holders, the
offering of Registrable Securities pursuant to Section 2.01 may be in the form
of an underwritten offering; PROVIDED, that the Majority Holders shall be
entitled to select the book-running managing underwriter subject to the approval
of the Company, which approval will not be unreasonably withheld.
5. REGISTRATION.
5.01 REGISTRATION PROCEDURES. In connection with the offering of Registrable
Securities pursuant to Section 2, the Company shall:
(a) prepare and file the Registration Statement with the Commission on
any form for which the Company then qualifies or which counsel for the
Company shall deem appropriate and which form shall be available for
the sale of the Registrable Securities thereunder in accordance with
the intended method of distribution thereof, and use its reasonable
efforts to cause such filed Registration Statement to become effective
as soon as practicable; and after the filing of the Registration
Statement, the Company will promptly notify each Holder of Registrable
Securities covered by the Registration Statement of any stop order
issued or threatened by the Commission and take all reasonable actions
required to prevent the entry of such stop order or to remove it if
entered;
(b) in the event of a Demand Registration, prepare and file with the
Commission such amendments and supplements to the Registration
Statement and
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the prospectus used in connection therewith as may be necessary to keep
such Registration Statement effective for a period of not less than 270
days or such shorter period which will terminate when all Registrable
Securities covered by such Registration Statement have been sold and
comply with the provisions of the 33 Act with respect to the
disposition of all securities covered by the Registration Statement
during such period in accordance with the intended methods of
disposition by the holders thereof set forth in the Registration
Statement;
(c) furnish to each Holder whose Registrable Securities are to be
included in the Registration Statement, prior to filing the
Registration Statement, if requested, copies of the Registration
Statement as proposed to be filed, and thereafter furnish to such
Holder such number of copies of the Registration Statement, each
amendment and supplement thereto (in each case including all exhibits
thereto), the prospectus included in the Registration Statement
(including each preliminary prospectus) and such other documents as
such Holder may reasonably request in order to facilitate the
disposition of the Registrable Securities owned by such Holder;
(d) use its reasonable efforts to register or qualify such Registrable
Securities under such other securities or Blue Sky laws of such
jurisdictions as any Holder or managing underwriter reasonably (in
light of the intended plan of distribution) requests and do any and all
other acts and things which may be reasonably necessary or advisable to
enable such Holder or managing underwriter to consummate the
disposition in such jurisdictions of the Registrable Securities owned
by such Holder; provided, however, that the Company will not be
required to (i) qualify generally to do business in any jurisdiction
where it would not otherwise be required to qualify but for this
Section 5.01(d), (ii) subject itself to taxation in any such
jurisdiction or (iii) consent to general service of process in any such
jurisdiction;
(e) use its reasonable efforts to cause such Registrable Securities to
be registered with or approved by such other governmental agencies or
authorities as may be necessary by virtue of the business and
operations of the Company to enable the Holder or Holders thereof to
consummate the disposition of such Registrable Securities;
(f) notify each Holder of such Registrable Securities, at any time when
a prospectus relating thereto is required to be delivered under the 33
Act, of the occurrence of an event requiring the preparation of a
supplement or amendment to such prospectus so that, as thereafter
delivered to the Holders of such Registrable Securities, such
prospectus will not contain any untrue statement of a material fact or
omit to state any material fact required to be stated therein or
necessary to make the statements therein not misleading and promptly
making available to each Holder any such supplement or amendment;
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(g) enter into customary agreements (including an underwriting
agreement in customary form) and take such other actions as are
reasonably required in order to expedite or facilitate the disposition
of such Registrable Securities;
(h) make available for inspection by Inspectors all Records as shall be
reasonably necessary to enable them to exercise their due diligence
responsibility, and cause the Company's officers, directors and
employees to supply all information reasonably requested by any such
Inspectors in connection with the Registration Statement. Records which
the Company determines, in good faith, to be confidential and which it
notifies the Inspectors are confidential shall not be disclosed by the
Inspectors unless (i) the disclosure of such Records is necessary to
avoid or correct a misstatement or omission in the Registration
Statement or (ii) release of such Records is ordered pursuant to a
subpoena or other order from a court of competent jurisdiction. Each
Holder of such Registrable Securities agrees that information obtained
by it as a result of such inspections shall be deemed confidential and
shall not be used by it as the basis for any market transactions in the
securities of the Company or its affiliates unless and until such is
made generally available to the public. Each Holder of such Registrable
Securities further agrees that it will, upon learning that disclosure
of such Records is sought in a court of competent jurisdiction, give
notice to the Company and allow the Company, at its expense, to
undertake appropriate action to prevent disclosure of the Records
deemed confidential;
(i) use its reasonable efforts to obtain a comfort letter or comfort
letters from the Company's independent public accounts in customary
form and covering such matters of the type customarily covered by
comfort letters;
(j) otherwise use its reasonable efforts to comply with all applicable
rules and regulations of the Commission, and make available to its
security holders, as soon as reasonably practicable, an earnings
statement satisfying the provisions of Section 11(a) of the 33 Act and
Rule 158 thereunder;
(k) cause all such Registrable Securities to be listed on each
securities exchange on which similar securities issued by the Company
are then listed; and
(l) provide a transfer agent and registrar for all such Registrable
Securities (if the Company does not already have such an agent) not
later than the effective date of such Registration Statement.
The Company may require each Holder of Registrable Securities to
promptly furnish in writing to the Company such information regarding the
distribution of the Registrable Securities as it may from time to time
reasonably request and such other information as may be legally required in
connection with such registration.
Each Holder agrees that, upon receipt of any notice from the Company of
the happening of any event of any kind described in Section 5.01(f) hereof, such
Holder xxxx
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forthwith discontinue disposition of Registrable Securities pursuant to the
Registration Statement covering such Registrable Securities until such Holder's
receipt of the copies of the supplemented or amended prospectus contemplated by
Section 5.01(f) hereof. In the event the Company shall give such notice, the
Company shall extend the period during which the Registration Statement shall be
maintained effective (including the period referred to in Section 5.01(f)
hereof) by the number of days during the period from and including the date of
the giving of notice pursuant to Section 5.01(f) hereof to the date when the
Company shall make available to the Holders of Registrable Securities covered by
the Registration Statement a prospectus supplemented or amended to conform with
the requirements of Section 5.01(f) hereof.
5.02. REGISTRATION EXPENSES. Xxxxxxxx will pay or cause to be paid all
Registration Expenses, including all fees and expenses (including all Blue Sky,
New York Stock Exchange and National Association of Securities Dealers, Inc.,
filing and registration fees, accounting fees and disbursements, printing costs,
attorneys' fees and disbursements), arising out of the preparation, filing,
amending and supplementing of a Registration Statement pursuant to Section 2.01
hereof and to the amount of such fees and expenses that are reasonably allocable
to the Selling Holder for a Registration Statement used under Section 2.02 based
on the number of shares offered by Holders relative to the number of other
shares offered by the Company or on behalf of any of its other holders.
6. RULE 144. With a view to making available the benefits of Rule 144 under
the 33 Act (or similar rule then in effect) available to each Holder, the
Company shall:
(a) make and keep available adequate current public information with
respect to the Company within the meaning of Rule 144(c) under the 33
Act (or similar rule then in effect);
(b) furnish to each Holder forthwith upon request (i) a written
statement by the Company as to its compliance with the informational
requirements of Rule 144(c) (or similar rule then in effect) or (ii) a
copy of the most recent annual or quarterly report of the Company; and
(c) comply with all other necessary filing and other requirements so as
to enable each Holder to sell Registrable Securities under Rule 144
under the 33 Act (or similar rule then in effect).
7. OTHER RIGHTS AND RESTRICTIONS.
7.01 VOTING. Xxxxxxxx will vote any Common Stock that it retains after the
Spin-off on all matters on which it has the right to vote in the same proportion
as the votes cast by other voting shareholders of the Company.
7.02 RESTRICTIONS ON OFFICERS AND DIRECTORS. None of the directors, officers,
or employees of Xxxxxxxx or any of its subsidiaries will serve as officers or
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directors of the Company or any of its subsidiaries as long as Xxxxxxxx or any
of its Subsidiaries is a Holder of Registrable Securities.
7.03 DISPOSAL OF STOCK.
(a) Subject to the receipt of a favorable ruling from the Internal Revenue
Service that such a limitation is not inconsistent with any ruling issued to
Xxxxxxxx regarding the tax-free treatment of the Spin-off, Xxxxxxxx agrees not
to Transfer any Registrable Securities for a period of three years from the date
of this Agreement. Xxxxxxxx will use its reasonable efforts to request, and to
diligently pursue the issuance of, such ruling as soon as is practicable.
(b) In any event, Xxxxxxxx will notify the Company of its intent to pursue a
Transfer of Registrable Securities. In reaching any determination as to market
conditions for Transfer of Registrable Securities, Xxxxxxxx and the Company will
consult, taking into consideration in the determination of market conditions any
plans of the Company to issue equity or debt and, on advice of experts, assess
the likely impact of such issuance on market conditions for Transfer of
Registrable Securities. Through the third anniversary of this Agreement,
Xxxxxxxx will utilize a financial advisor reasonably acceptable to the Company
for any Transfer of Registrable Securities.
7.04 RIGHT OF FIRST OFFER.
(a) If, at any time, Xxxxxxxx desires to Transfer any Registrable Securities
then owned by Xxxxxxxx to a Third Party other than pursuant to a Registration
Statement or Rule 144 (the "Transfer Stock"), Xxxxxxxx shall provide to the
Company a written notice (the "Right of First Offer Notice") stating the price
at which it would like to sell any such shares of Transfer Stock and the maximum
number of such shares it intends to sell (the "Transfer Offer"). The Right of
First Offer Notice shall also contain an offer to sell the Transfer Stock to the
Company, or to any of its designees (in the manner set forth below) at the same
price and upon substantially the same terms and conditions as the terms and
conditions contained in the Transfer Offer; provided, that, for purposes of this
Section 7.04, the term "the Company" shall include any of its designees.
(b) The Company shall have the right and option, within ten (10) Business Days
after the date the Right of First Offer Notice is received by the Company to
accept irrevocably such offer in the aggregate, as to all, but not less than all
(unless otherwise consented to by Xxxxxxxx) shares of Transfer Stock. If the
Company desires to exercise such option, it shall provide Xxxxxxxx with written
notice (specifying the number of shares of the Transfer Stock as to which it is
accepting the offer) within such ten (10) Business Day period. Unless Xxxxxxxx
shall have otherwise consented to the purchase of less than all of the shares of
Transfer Stock, the Company shall not have the right to acquire such shares of
Transfer Stock unless all such shares are being acquired by the Company in the
aggregate pursuant to the provisions of this Section 7.04.
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(c) Notwithstanding anything to the contrary contained in this Section 7.04,
there shall be no liability on the part of Xxxxxxxx to the Company in the event
that the sale of Transfer Stock contemplated pursuant to this Section 7.04 is
not consummated for any reason whatsoever. Whether a sale of Transfer Stock
contemplated pursuant to this Section 7.04 is effected by Xxxxxxxx is in the
sole and absolute discretion of Xxxxxxxx.
(d) The closing of the purchase of the Transfer Stock by the Company shall take
place at the principal executive offices of the Company as soon as practicable,
but in no event later than thirty (30) Business Days after the expiration of the
ten (10) Business Day period after the giving of the Right of First Offer Notice
(or such other date as may be mutually agreed to by the parties to such
transaction). At such closing, the Company shall deliver to Xxxxxxxx the
appropriate per share cash consideration pursuant to a bank, cashier's or
certified check or by wire transfer of immediately available funds (unless
otherwise specified in the Right of First Offer Notice provided to the Company),
against delivery of certificates representing the Transfer Stock so purchased
Duly Endorsed. Any Transfer (other than to a Third Party) pursuant to this
Section 7.04 shall be made without any representations, warranties, covenants or
indemnities; except, that, each transferor shall be deemed to have represented
that (i) the transfer has been duly authorized by it, (ii) that it has the
capacity, power and authority to Transfer such shares and (iii) that the
acquirer shall obtain good title to such shares, free and clear of any defects,
encumbrances and adverse interests (other than as provided for in this
Agreement).
(e) If at the end of the ten (10) Business Day period following the giving of
the Right of First Offer Notice, the Company shall not have accepted the offer
contained in such notice as to all shares of Transfer Stock covered thereby,
Xxxxxxxx shall have ninety (90) days in which to sell the Transfer Stock to a
Third Party, at a price that is no less than 95% of the price contained in the
Right of First Offer Notice and on terms and conditions not more favorable to
such Third Party than were contained in the Right of First Offer Notice.
Promptly after any sale pursuant to this Section 7.04(e), Xxxxxxxx shall notify
the Company of the consummation thereof and shall furnish such evidence of the
completion (including time of completion) of such sale and of the terms and
conditions thereof as the Company may reasonably request. If, at the end of such
ninety (90) day period, Xxxxxxxx has not completed the sale of the Transfer
Stock, it shall no longer be permitted to sell such shares pursuant to this
Section 7.04(e) without again fully complying with the provisions of this
Section 7.04 and all the restrictions on Transfer contained in this Agreement
shall again be in effect with respect to all Xxxxxxxx' shares of Common Stock,
including the Transfer Stock.
(f) The provisions of this Section 7.04 shall not be applicable to any Transfer
of Registrable Securities from Xxxxxxxx to its Affiliates, or from any Affiliate
of Xxxxxxxx to Xxxxxxxx.
7.05 STANDSTILL PROVISION. Xxxxxxxx agrees that from and after the date of this
Agreement until ten (10) years from the date of this Agreement, it shall not,
and shall cause each of its directors, officers, employees, agents, Affiliates
or representatives (any
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of the foregoing, a "Representative") not to, without the prior written consent
of the Board of Directors specifically expressed in a resolution approved by a
majority of the directors of the Company, directly or indirectly, through one or
more intermediaries or otherwise, (i) acquire, agree to acquire or make any
proposal to acquire any securities of the Company or any of its Subsidiaries,
any warrant or option to acquire any such securities, any security convertible
into or exchangeable for any such securities or any other right to acquire any
such securities in excess of the 10% Limit; (ii) seek or propose any merger,
consolidation, business combination, tender or exchange offer, sale or purchase
of assets or securities, dissolution, liquidation, restructuring,
recapitalization or similar transaction of or involving the Company or any of
its Subsidiaries; (iii) make, or in any way participate in, any "solicitation"
of proxies or consents (whether or not relating to the election or removal of
directors) within the meaning of Rule 14a-1 under the 34 Act with respect to any
securities of the Company or any of its Subsidiaries, or seek to advise or
influence any person with respect to the voting of any securities of the Company
or any of its Subsidiaries or demand a copy of the stock ledger, list of
stockholders, or any other books and records of the Company or any of its
Subsidiaries; (iv) form, join or in any way participate in a "group" (within the
meaning of Section 13(d)(3) of the 34 Act), with respect to any securities of
the Company or any of its Subsidiaries; (v) otherwise act, alone or in concert
with others, to seek to control or influence, in any manner, the management,
Board of Directors or policies of the Company or any of its Subsidiaries; (vi)
deposit any Common Stock in any voting trust or subject any Common Stock to any
arrangement or agreement with respect to the voting of such shares; (vii) call
or seek to have called any meeting of the stockholders of the Company or execute
any written consent with respect to the Company or the Common Stock; (viii)
seek, alone or in concert with others, representation on the Board of Directors
or seek the removal of any member of such Board or a change in the composition
or size of such Board; (ix) have any discussions or enter into any arrangements,
understandings or agreements (whether written or oral) with, or advise, finance,
assist or encourage, any other persons in connection with any of the foregoing,
or make any investment in any other person that engages, or offers or proposes
to engage, in any of the foregoing; or (x) make any publicly disclosed proposal
regarding any of the foregoing. Xxxxxxxx also agrees during such period not to
make any proposal, statement or inquiry, or disclose any intention, plan or
arrangement to the public or a Third Party (whether written or oral)
inconsistent with the foregoing.
8. INDEMNIFICATION AND CONTRIBUTION.
8.01 INDEMNIFICATION OF HOLDERS: The Company agrees to indemnify and hold
harmless each Holder and each Person, if any, who controls (within the meaning
of Section 15 of the 33 Act and Section 20 of the 34 Act) such Holder (a
"Control Person") against any losses, claims, damages or liabilities, joint or
several, to which such Holder or any such Control Person may become subject,
insofar as such losses, claims, damages or liabilities (or actions in respect
thereof) arise out of or are based upon any untrue statement or alleged untrue
statement of any material fact contained in any preliminary or final
Registration Statement or prospectus with respect thereto, or any amendment or
supplement thereto, or arise out of or are based upon the omission or alleged
omission to
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state therein a material fact required to be stated therein or necessary to make
the statements therein, in light of the circumstances under which they were
made, not misleading; and the Company will reimburse each Holder and each
Control Person for any legal or other expenses reasonably incurred by such
Holder or such Control Person in connection with investigating or defending any
such loss, claim, damage liability or action; provided, however, that the
Company will not be liable in any case to the extent that any such loss claim,
damage or liability arises out of or is based upon an untrue statement or
alleged untrue statement or omission or alleged omission from any of such
documents in reliance upon and in conformity with written information furnished
by or on behalf of such Holder or any such Control Person specifically for use
in the preparation thereof.
8.02 INDEMNIFICATION BY HOLDER OR REGISTRABLE SECURITIES. Each Holder will,
severally and not jointly, indemnify and hold harmless the Company and each of
its directors, officers and each Person, if any, who controls (within the
meaning of Section 15 of the 33 Act and Section 20 of the 34 Act) the Company (a
"Company Control Person") to the same extent as set forth in the foregoing
indemnity from the Company to each Holder but only with reference to written
information included in any preliminary or final Registration Statement or
prospectus with respect thereto, or amendment or supplement thereto, furnished
by or on behalf of such Holder specifically for use in the preparation of such
documents; and will reimburse the Company or any such Company Control Person for
any legal or other expenses reasonably incurred by them in connection with
investigating or defending any loss, claim, damage, liability or action for
which such Holder is obligated to indemnify the Company or any Company Control
Person.
8.03 CONDUCT OF INDEMNIFICATION PROCEEDINGS. Promptly after receipt by an
indemnified party under this Article 8 of notice of any claim or the
commencement of any action, such indemnified party will, if a claim in respect
thereof is to be made against an indemnifying party under Section 8.01 or 8.02
above, notify the indemnifying party of any claim or the commencement thereof;
but the omission so to notify the indemnifying party will not relieve it from
any liability which it may have to any indemnified party otherwise than under
Section 8.01 or 8.02 above. In case any such action is brought against any
indemnified party and it notifies an indemnifying party of the commencement
thereof, the indemnifying party will be entitled to participate therein and, to
the extent that it may wish, jointly with any other indemnifying party similarly
notified, to assume the defense thereof, with counsel reasonably satisfactory to
such indemnified party (who shall not, except with the consent of the
indemnified party, be counsel to the indemnifying party), and after notice from
the indemnifying party to such indemnified party of its election so to assume
the defense thereof, the indemnifying party will not be liable to such
indemnified party in connection with the defense thereof other than reasonable
costs of investigation. No indemnifying party shall, without the prior written
consent of the indemnified party, effect any settlement of any pending or
threatened action in respect of which any indemnified party is or could have
been a party and indemnity could have been sought hereunder by such indemnified
party unless such
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settlement includes an unconditional release of such indemnified party from all
liability on any claims that are the subject matter of such action.
8.04 CONTRIBUTION. If the indemnification provided for in Section 8.01 or 8.02
is unavailable or insufficient in accordance with its terms in respect of any
losses, claims, damages or liabilities (or actions in respect thereof) referred
to therein, then each indemnifying party shall contribute to the amount paid or
payable by such indemnified party as a result of such losses, claims, damages or
liabilities (or actions in respect thereof) in such proportion as is appropriate
to reflect the relative benefits as well as the relative fault of the Company on
the one hand and the Holder on the other in connection with the statements or
omissions which resulted in such losses, claims, damages or liabilities (or
actions in respect thereof), as well as any other relevant equitable
consideration. The relative benefits received by the Company on the one hand and
each Holder on the other shall be deemed to be in the same proportion as the
total net proceeds from the offering (net of underwriting discounts and
commissions but before deducting expenses) received by the Company on the one
hand bears to the total net proceeds received by the Holder from the offering.
The relative fault shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information
supplied by the Company on the one hand or the Holder on the other and the
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission.
8.05 OBLIGATIONS. The obligations of the Company under this Section shall be in
addition to any liability which the Company may otherwise have and shall extend,
upon the same terms and conditions, to each director of any Holder and to each
person, if any, who controls any Holder or any underwriter within the meaning of
either Section 15 of the 33 Act or Section 20 of the 34 Act. The obligations of
each Holder under this Section shall be in addition to any liability which the
respective Holder may otherwise have and shall extend, upon the same terms and
conditions, to each director of the Company, to each officer of the Company who
has signed any Registration Statement and to each person, if any, who controls
the Company or any underwriter (within the meaning of either Section 15 of the
33 Act or Section 20 of the 34 Act).
9. MISCELLANEOUS.
9.01 NOTICES. All notices and other communications provided for or permitted
hereunder shall be made by hand-delivery or registered first-class mail:
(i) HOLDER. If to a Holder of Registrable Securities, at the
most current address, and with a copy to be sent to each additional address
given by such Holder.
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(ii) if to the Company:
General Counsel
Xxxxxxxx Communications Group, Inc.
Xxx Xxxxxxxx Xxxxxx
Xxxxx XX 00000
All such notices and communications shall be deemed to have
been duly given when delivered by hand, if personally delivered, or two business
days after being deposited in the mail, postage prepared, if mailed.
9.02 TRANSFER OF REGISTRATION RIGHTS; SUCCESSORS AND ASSIGNS. Xxxxxxxx may
transfer or assign its rights hereunder, in whole or in part, without the prior
approval of the Company. This Agreement and its benefits shall inure to the
benefit of and be binding upon the successors and assigns of each of the parties
hereto.
9.03 AMENDMENTS AND WAIVERS. The provisions of this Agreement, including the
provisions of this sentence, may not be amended, modified or supplemented, and
waivers or consents to departures from the provisions hereof may not be given
without the written consent of the Company and the Majority Holders.
9.04 COUNTERPARTS. This Agreement may be executed in any number of counterparts
and by the parties hereto in separate counterparts, each of which when so
executed shall be deemed to be an original and all of which taken together shall
constitute one and the same agreement.
9.05 HEADINGS. The headings in this Agreement are for convenience of reference
only and shall not limit or otherwise affect the meaning thereof.
9.06 GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of Oklahoma without regard to principles
of conflicts of law.
9.07 SEVERABILITY. In the event that any one or more of the provisions contained
herein, or the application thereof in any circumstances, is held invalid,
illegal or unenforceable in any respect for any reason, the validity, legality
and enforceability of any such provision in every other respect and of the
remaining provisions contained herein shall not be in any way impaired thereby,
it being intended that all of the rights and privileges of each Holder shall be
enforceable to the fullest extent permitted by law.
9.08 SPECIFIC PERFORMANCE. The parties hereto acknowledge that there would be no
adequate remedy at law if any party fails to perform any of its obligations
hereunder, and accordingly agree that each party, in addition to any other
remedy to which it may be entitled at law or in equity, shall be entitled to
compel specific performance of the obligations of any other party under this
Agreement in accordance with the terms and
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conditions of this Agreement in any court of the United States or any State
thereof having jurisdiction.
9.09 ENTIRE AGREEMENT. This Agreement, together with the Amended and Restated
Separation Agreement made by and between Xxxxxxxx and the Company dated
concurrently herewith (the "Separation Agreement"), is intended by the parties
as a final expression of their agreement and intended to be a complete and
exclusive statement of the agreement and understanding of the parties hereto in
respect of the subject matter contained herein and therein. There are no
restrictions, promises, warranties or undertakings, other than those set forth
or referred to herein and therein. This Agreement and the Separation Agreement
(including the exhibits thereto) supersede all prior agreements and
understandings between the parties with respect to subject matter, including
without limitation, the Registration Rights Agreement made by and between
Xxxxxxxx and the Company dated September 30, 1999.
9.10 DISPUTE RESOLUTION. The parties agree that any dispute arising under this
Agreement shall be resolved in accordance with the Dispute Resolution Procedures
set forth in the Separation Agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
the day and year first written above.
XXXXXXXX COMMUNICATIONS GROUP, INC.
BY: /s/ XXXXXX X. XXXXXX
--------------------------------------
NAME: Xxxxxx X. Xxxxxx
TITLE: Vice President
THE XXXXXXXX COMPANIES, INC.
BY: /s/ XXXX X. XXXXXXXX
--------------------------------------
NAME: Xxxx X. XxXxxxxx
TITLE: Senior Vice President
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