THE WINDSOR ART, INC.
VOTING TRUST AGREEMENT NO. 1
THIS VOTING TRUST AGREEMENT (the "Agreement") is made and entered into
this 30th day of July, 1998, by and among XXXXX X. XXXXXX and XXX XXXX as voting
trustees (in such capacity, the "Voting Trustees"), INTERIORS, INC., a Delaware
corporation (the "Shareholder"), and BENTLEY INTERNATIONAL, INC., a Missouri
corporation ("Bentley").
W I T N E S S E T H:
WHEREAS, Shareholder has entered into on even date herewith a Stock
Purchase Agreement (the "Stock Purchase Agreement") with Bentley to acquire all
of the issued and outstanding shares (the "Shares") of common stock, par value
$1.00 per share ("Common Stock") of WINDSOR ART, INC., a Missouri corporation
("Windsor"); and
WHEREAS, pursuant to the terms of the Stock Purchase Agreement Shareholder
has agreed that the Shares shall be registered in the names of the Voting
Trustees and held pursuant to the terms and provisions of this Agreement until
certain indebtedness of Shareholder and Windsor is paid in full; and
WHEREAS, the Voting Trustees are willing to serve as Trustees with respect
to the Shares of Common Stock of Windsor as herein provided.
NOW, THEREFORE, in consideration of the premises and the covenants and
agreements hereinafter set forth, and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
agree as follows:
1. Shares to be Held in Trust.
(a) Establishment of Voting Trust. Shareholder and the Voting
Trustees hereby establish and constitute this voting trust (the "Voting Trust")
with respect to the Shares of Common Stock of Windsor to be sold and transferred
pursuant to the Stock Purchase Agreement (such Shares of Common Stock of Windsor
hereinafter are referred to collectively as the "Trust Shares"). The Voting
Trust shall be administered on the terms set forth in this Agreement. The Voting
Trust may be referred to as "The Windsor Art, Inc. Voting Trust No. 1" without
reference to the date of this Agreement.
(b) Actions to be Taken. At the Closing described in the Stock
Purchase Agreement, the following actions shall be taken by each of the parties
hereto:
(i) Shareholder shall instruct Bentley and Windsor in writing
that all certificates evidencing Shares of Common Stock of Windsor
to be issued in connection with the Closing pursuant to the Stock
Purchase Agreement shall be issued to and in the name of the Voting
Trustees pursuant to this Agreement.
Bentley shall cause such certificates to be so issued and delivered
to the Voting Trustees. The Voting Trustees hereby are authorized to
receive and to hold, in the name of the Voting Trustees, for the
benefit of Shareholder (subject to the rights of Bentley as stated
herein, in the Stock Purchase Agreement and in that certain Pledge
Agreement (the "Pledge Agreement") of even date herewith between
Shareholder and Bentley ), the Trust Shares.
(ii) Immediately following the receipt of the Trust Shares,
the Voting Trustees shall (a) issue to Interiors a voting trust
certificate in the form of Exhibit A attached hereto (the "Voting
Trust Certificate") evidencing the number of Trust Shares held by
the Voting Trustees, (b) deliver possession of all certificates
representing the Trust Shares to Riezman & Blitz, P.C., the "Agent,"
so designated in the Pledge Agreement and (c) execute in blank and
deliver to the Agent the irrevocable stock power attached hereto as
Exhibit B.
(iii) Immediately following the receipt of the Voting Trust
Certificate, Interiors shall (a) deliver possession of the Voting
Trust Certificate to the Agent and (b) shall execute and deliver to
the Agent the irrevocable stock power attached hereto as Exhibit B.
(c) Voting Securities Subsequently Acquired. The parties hereto
acknowledge that, if any additional voting securities of Windsor are issued with
respect to or in exchange for the Trust Shares, whether by reason of a stock
split, stock dividend, share exchange, merger, consolidation or similar
transaction, certificates representing such additional voting securities shall
be delivered to the Voting Trustees, who shall, in turn, deliver the same to the
Agent along with executed irrevocable stock powers with respect to such
additional voting securities in form and substance equivalent to Exhibit B, and
such additional voting securities shall constitute "Trust Shares" hereunder. The
Voting Trustees shall execute and deliver one or more Voting Trust Certificates
to Shareholder to represent Shareholder's interest in such additional voting
securities, which Shareholder, in turn, shall deliver forthwith to Agent along
with executed irrevocable stock powers with respect to such additional Voting
Trust Certificates in form and substance equivalent to Exhibit B. For purposes
of this Agreement, "voting securities" shall mean any equity securities of
Windsor (or any corporate successor, including any entity which acquires the
capital stock of Windsor or assets of Windsor in consideration for voting
securities) which may be entitled by law to vote at any time with respect to any
matter, whether or not such equity securities are accorded voting rights under
the Articles of Incorporation of Windsor (or such successor).
(d) Legend. All certificates representing the Trust Shares, and all
warrants and options exercisable for equity securities which shall become Trust
Shares as set forth herein, shall bear a legend substantially to the effect that
"The shares of stock of the corporation [represented hereby/receivable upon
exercise hereof] are subject to the terms of The Windsor Art, Inc. Voting Trust
Agreement No. 1, dated July 7, 1998, as the same may be amended and/or restated
from time to time, a copy of which is on file with the corporation."
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2. Voting Trust Shares.
(a) Power to Vote Trust Shares. Subject to the provisions of this
Agreement, the Voting Trustees shall have the power to vote the Trust Shares
with respect to any matter, for or against, on which the Trustees shall agree.
(b) Matters on Which Trust Shares May Be Voted. Subject to the
provisions of this Agreement, the Voting Trustees, as such, shall have full
power and discretion to vote the Trust Shares for the election of directors of
Windsor and on any and all other matters with respect to which holders of the
voting securities of Windsor are entitled to vote (including but not limited to
amendments of Windsor's Articles of Incorporation, mergers, consolidations,
share exchanges, dissolution of Windsor, acquisitions of business, issuances of
securities or sales or other dispositions of all or substantially all of the
assets or stock of Windsor or any subsidiary thereof), whether such matters are
considered in a meeting of such holders or in a unanimous written consent to be
executed by them.
(c) Special Matters Regarding Voting of Trust Shares. The foregoing
provisions of this Agreement notwithstanding, until there is a "Default"
(hereinafter defined), the Voting Trustees shall vote all the Trust Shares in
such manner as may be necessary (i) to provide that Windsor's Board of Directors
shall consist of two members, one designated by Shareholder and the other
designated by Bentley and (ii) to authorize and allow Windsor and Shareholder to
effect (A) financing based on the assets of Windsor within the limits set forth
in the Stock Purchase Agreement, (B) "Mezzanine Financing" as defined in and
subject to the limits set forth in the Stock Purchase Agreement, so long as the
proceeds of such financing are used to pay in full Windsor's existing "Credit
Facility" with Norwest Business Credit, Inc. and any outstanding indebtedness
(including interest) under the "Second Promissory Note" as defined in the Stock
Purchase Agreement. Anything herein to the contrary notwithstanding, upon and
after any Default (i) under either of the Promissory Notes between Shareholder
and Bentley executed on even date herewith as part of the consideration for the
Shares pursuant to the Stock Purchase Agreement or (ii) under that certain
Consulting Agreement between Windsor and Xxxxx X. Xxxxxx executed as of even
date herewith, Xxxxx X. Xxxxxx (or his successor Trustee hereunder) shall become
the sole Trustee of this Voting Trust and any other Trustee of the Voting Trust
shall cease to act in such capacity, and Xxxxx X. Xxxxxx (or his successor
Trustee hereunder) shall have the sole right and power, in his absolute
discretion, to vote the Trust Shares as described above in Section 2(a) and
Section 2(b) on any and all matters with respect to which holders of the voting
securities of Windsor are entitled to vote (including but not limited to
amendments of Windsor's Articles of Incorporation and Bylaws). For purposes of
this Agreement the term "Default" as used herein shall mean (a) any failure by
Shareholder to make any payment of interest or principal with respect to either
of the Promissory Notes when the same is due or within any grace period provided
for in such Promissory Notes, (b) any other Default as such term is defined in
either of such Promissory Notes or (c) any failure by Windsor to make any
payment of any amount under the Consulting Agreement when the same is due or
within any grace period provided for in such Consulting Agreement.
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3. Voting Trustees.
(a) Any individual acting as one of the Voting Trustees shall have
the right to resign as a Voting Trustee hereunder during his lifetime at any
time by notice delivered to the other Voting Trustee, Bentley and Shareholder,
such resignation to be effective at such time as a successor Voting Trustee
accepts this Agreement pursuant to Section 3(c).
(b) Subject to the terms of Section 2(c) of this Agreement, in the
event of the resignation, death or inability of one of the Voting Trustees to
serve for any reason, the successor to such Voting Trustee shall be an
individual appointed in accordance with the provisions of this Section 3(b). In
the event the trusteeship originally occupied by Xxxxx X. Xxxxxx (the "Xxxxxxx
Trusteeship") becomes vacant, Bentley within ten (10) days of its receipt of
notice of such vacancy shall appoint another individual to as a Voting Trustee
hereunder who shall occupy the Bentley Trusteeship and shall for purposes of
this Agreement be deemed Xxxxx X. Xxxxxx' successor; and in the event the
trusteeship originally occupied by Xxx Xxxx (the "Interiors Trusteeship")
becomes vacant, Interiors within ten (10) days of its receipt of notice of such
vacancy shall appoint another individual to as a Voting Trustee hereunder who
shall occupy the Interiors Trusteeship and shall for purposes of this Agreement
be deemed Xxx Xxxx'x successor.
(c) Any person appointed as a successor Voting Trustee hereunder
shall become a Voting Trustee only upon written acceptance of this Agreement and
the rights, powers, duties and obligations of the Voting Trustees hereunder, and
the delivery of such acceptance to the acting Voting Trustee (if any), Bentley
and Shareholder. Each successor Voting Trustee shall have the same rights,
powers, duties and obligations as the Voting Trustee whom such successor
succeeds.
4. Cash Dividends; Shareholder Materials. During the term of this
Agreement, the Voting Trust Certificate holder shall continue to remain entitled
to receive any cash and in kind dividends declared and paid with respect to the
Trust Shares (except in kind dividends of voting securities), and any
informational materials distributed by Windsor to all holders of voting
securities of the Windsor. The Voting Trustees shall be solely responsible for
the delivery of such informational materials and cash and in kind dividends to
the Voting Trust Certificate holder.
5. Termination.
(a) This Agreement and the Voting Trust created herein shall
terminate upon the earlier to occur of the following: (i) the execution of an
instrument by all parties to this Agreement terminating this Agreement; (ii) at
such time as the Promissory Notes have been paid in full and all obligations
under the Consulting Agreement have either been paid in full or satisfied; or
(iii) at such time as the Voting Trust Certificate has been acquired by Bentley
pursuant to the Pledge Agreement.
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(b) Upon termination of this Agreement and the Voting Trust created
herein upon the occurrence of events recited in Section 5(a)(i) or Section
5(a)(ii) above, Shareholder shall surrender to the then acting Voting Trustees
Shareholder's Voting Trust Certificate, duly endorsed for transfer. The Voting
Trustees shall as soon as practicable thereafter cause to be distributed to
Shareholder, free from trust, one or more certificates representing the Trust
Shares to which Shareholder (or Shareholder's assignee) is entitled, which
certificates shall not contain the legend recited in Section 1(d) hereof.
(c) Upon termination of this Agreement and the Voting Trust created
herein upon the occurrence of events recited in Section 5(a)(iii) above, Bentley
shall surrender to the then acting Voting Trustees the Voting Trust Certificate,
duly endorsed for transfer. The Voting Trustees shall as soon as practicable
thereafter cause to be distributed to Bentley, free from trust, one or more
certificates representing the Trust Shares to which Bentley (or Bentley's
assignee) is entitled, which certificates shall not contain the legend recited
in Section 1(d) hereof.
6. Transfer and Distribution of Trust Shares. Except as expressly provided
in this Agreement and in the Pledge Agreement, no party to this Agreement shall
have the right or power to sell, pledge, give, assign or transfer in any other
manner the Voting Trust Certificate or any of the Trust Shares or any interest
in either. Each party hereto agrees that any transfer of the Voting Trust
Certificate or Trust Shares shall be in accordance with all applicable federal
and state securities laws.
7. Compensation of Voting Trustees. The Voting Trustees shall receive no
compensation for their services as Voting Trustees hereunder, but this provision
shall not limit in any way the compensation or benefits which a Voting Trustee
may receive in his or her capacity as an officer, director, consultant or
attorney of any of the parties to this Agreement.
8. Liability of Voting Trustees. Subject to the terms of this Agreement,
it is the intention of the parties that the Voting Trustees have unfettered
discretion to vote the Trust Shares as they deem appropriate. No Voting Trustee
shall be liable to Shareholder or any other person for any loss arising out of
or in connection with his or her voting of any of the Trust Shares or any other
action or inaction as Voting Trustees hereunder, unless such loss was caused by
a Voting Trustee's gross negligence or willful misconduct. The Voting Trustees
may consult with counsel of their choice, and shall have full and complete
authorization and protection for any action taken or suffered by the Voting
Trustees under this Agreement in good faith and in accordance with the opinion
of such counsel. No Voting Trustee acting hereunder shall be required to give a
bond or other security for the faithful performance of its duties as such.
9. Dissolution. In the event of the dissolution or total or partial
liquidation of the Windsor, whether voluntary or involuntary, the Voting
Trustees shall receive the moneys, securities, rights or property to which the
Voting Trust Certificate holders deposited hereunder are entitled and shall
distribute the same among the registered holders of Voting Trust Certificates in
proportion to their respective interests therein. Upon such distribution, all
further
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obligations or liability of the Voting Trustees in respect of such moneys,
securities, rights or property so received shall cease.
10. Non-Disqualification. Nothing herein contained shall disqualify a
Voting Trustee from voting for it or any of its employees, officers, directors,
shareholders or affiliates to serve or from having any such persons serve
Windsor or any of its subsidiaries or affiliates as an officer or director or in
any other capacity and from voting for any of its employees, officers,
directors, shareholders or affiliates to receive and having any such persons
receive compensation for such services.
11. Notices. All notices and other communications shall be in writing and
shall be personally delivered or delivered by certified mail, return receipt
requested, addressed to such party at its address hereinafter set forth, or such
other address as such party may hereafter specify by notice given pursuant to
this Section 11. Each such notice or other communication shall be effective (i)
if personally delivered, on the date of such delivery; and (ii) if given by
certified mail, return receipt requested, three (3) days after deposit in the
mail with appropriate certified postage prepaid, addressed as aforesaid.
In the case of the Voting Trustees, to:
Xxxxx X. Xxxxxx Xxx Xxxx
0000 Xxxxxx Xxxx Interiors, Inc.
Xx. Xxxxx, Xxxxxxxx 00000 000 Xxxxxxxxxx Xxxxxx
Xx.Xxxxxx, XX 00000-0000
In the case of Shareholder to:
Interiors, Inc.
000 Xxxxxxxxxx Xxxxxx
Xx. Xxxxxx, XX 00000-0000
Attn: Xxx Xxxx
In the case of Bentley to:
Bentley International, Inc.
0000 Xxxxxx Xxxx
Xx. Xxxxx, Xxxxxxxx 00000
Attn: Xxxxx X. Xxxxxx
In the case of any notice to Xxx Xxxx or Shareholder a copy shall be sent
also to:
Paul, Hastings, Xxxxxxxx & Xxxxxx LLP
Twenty-Third Floor
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000 Xxxxx Xxxxxx Xxxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: XxXxxx X. Xxxxx, Esq.
In the case of any notice to Xxxxx X. Xxxxxx or Xxxxxxx a copy shall be
sent also to:
Xxxxxxx X. Xxxxxxx
Riezman & Blitz, P.C.
0000 Xxxxxxxx Xxx. 0xx Xxxxx
Xx. Xxxxx, XX 00000
12. Amendment. This Agreement may be amended or modified in whole or in
part only by a document in writing signed by the Voting Trustees and each other
party against whom such amendment or modification is to be enforced.
13. Counterparts. This Voting Trust Agreement may be executed in one or
more counterparts, each of which shall constitute an original, and all of which
taken together shall constitute one instrument.
14. Severability. If any one or more of the provisions contained in this
Agreement or any application thereof shall be invalid, illegal or unenforceable
in any respect, the validity, legality or enforceability of the remaining
provisions of this Agreement and any other application thereof shall not in any
way be affected or impaired thereby.
15. Headings. The headings in this Agreement are inserted for convenience
only and in no way alter, amend, modify, limit or restrict the contractual
obligations of the parties hereto.
16. Binding Effect. This Agreement shall be binding on, inure to the
benefit of, and be enforceable by and against the Voting Trustees, the other
parties hereto, and their respective heirs, personal representatives,
distributees, successors and assigns.
17. Governing Law. This Agreement shall be governed by and construed in
accordance with the internal laws of the State of Missouri.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the
day and year first above written.
/s/ Xxxxx X. Xxxxxx /s/ Xxx Xxxx
------------------------------------- -------------------------------------
Xxxxx X. Xxxxxx, as a Voting Trustee Xxx Xxxx, as a Voting Trustee
BENTLEY INTERNATIONAL, INC. INTERIORS, INC.
By:/s/ Xxxxx X. Xxxxxx By:/s/ Xxx Xxxx
------------------------------------- -------------------------------------
Xxxxx X. Xxxxxx, President Xxx Xxxx, President
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Exhibit A to
Windsor Art, Inc. Voting Trust Agreement No. 1
THE SECURITIES REPRESENTED BY THIS VOTING TRUST CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS
OF ANY STATE. WITHOUT SUCH REGISTRATION, SUCH SECURITIES MAY BE TRANSFERRED ONLY
IF REGISTERED UNDER APPLICABLE SECURITIES LAW OR IF AN EXEMPTION THEREFROM IS
AVAILABLE.
No.__________________ ___________________ Shares
Windsor Art, Inc.
a Missouri corporation
Voting Trust Certificate
This certifies that:
(1) certificates representing _______ shares of Common Stock of Windsor
Art, Inc., a Missouri corporation ("Company"), have been deposited with the
undersigned, as Voting Trustees under the Windsor Art, Inc. Voting Trust
Agreement No. 1 (the "Voting Trust Agreement"), dated as of July 7, 1998, among
Xxxxx X. Xxxxxx and Xxx Xxxx, as Voting Trustees, and the other parties thereto,
including the person named in the immediately succeeding paragraph; and
(2) Interiors, Inc., a Delaware corporation or the registered assigns
thereof, is entitled to all of the benefits arising from the deposit of such
shares, subject to the terms and conditions set forth in the Voting Trust
Agreement.
Subject to the limitations set forth in the Voting Trust Agreement, and
subject to limitations imposed by applicable law from time to time (if any),
this certificate and the rights of the registered holder may be transferred on
the records maintained by the Voting Trustees under the Voting Trust Agreement.
In the event of such a transfer, the Voting Trustees shall cause appropriate
evidence thereof to be endorsed hereon or shall, in the discretion of the Voting
Trustees, cause another certificate (or additional certificates) to be issued in
replacement for this certificate to reflect the transfer appropriately.
IN WITNESS WHEREOF, the undersigned Voting Trustees have executed this
certificate this 7th day of July, 1998.
_______________________________ _______________________________
Xxxxx X. Xxxxxx, Voting Trustee Xxx Xxxx, Voting Trustee
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Exhibit B to
Windsor Art, Inc. Voting Trust Agreement No. 1
IRREVOCABLE STOCK POWER AND ASSIGNMENT
FOR VALUE RECEIVED, the undersigned do hereby sell, assign and transfer
unto ____________________________ _______ shares of the of common stock, par
value $1.00 per share ("Common Stock"), of WINDSOR ART, INC. (the "Company")
represented by Stock Certificate No. ________ and all of the undersigned's
right, title and interests in and to that certain Voting Trust Certificate No.1
(issued pursuant to the terms and provisions of the Windsor Art, Inc. Voting
Trust Agreement No. 1), both certificates being attached hereto, being all of
the Common Stock of the Company owned by the undersigned, and do hereby
irrevocably constitute and appoint _____________________ as attorney to transfer
the said stock on the books of the Company and surrender the Voting Trust
Certificate as provided in the said Voting Trust Agreement in connection
therewith with full power of substitution in the premises.
Dated: July 7, 1998
_______________________________ _______________________________
Xxxxx X. Xxxxxx, Voting Trustee Xxx Xxxx, Voting Trustee
Being the Voting Trustees under the Windsor Art, Inc. Voting Trust Agreement No.
1
In the Presence Of:
_______________________________
Interiors, Inc.
By:_______________________________
Xxx Xxxx, President
In the Presence Of:
_______________________________
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