EXHIBIT 10.10
XXXXXXX HOLDINGS CORPORATION
STOCKHOLDERS AGREEMENT
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THIS AGREEMENT is made as of June 14, 1996, by and among Xxxxxxx
Holdings Corporation, a Delaware corporation (the "Company"), the State Board of
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Administration of Florida ("SBA"), Liberty Partners Holdings 11, L.L.C. ("LPH"),
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Riverside Xxxxxxx, L.L.C. ("Riverside"), Xx. Xxxxxxx X. Xxxxxxx ("Xxxxxxx"),
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Xxxx X. XxXxxxxxxx ("XxXxxxxxxx"), Xxxx Xxxxxxx ("Xxxxxxx"), Xxxxxx Xxxxxx
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("Xxxxxx") and Xxxxxx Xxxxxxxxx ("Xxxxxxxxx"). SBA and LPH are collectively
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referred to as the "Liberty Investors," and the Liberty Investors, Riverside,
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Xxxxxxx, McLaughlin, Moorman, Xxxxxx and Xxxxxxxxx are collectively referred to
as the "Stockholders" and individually as a "Stockholder."
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WHEREAS, the Liberty Investors and Riverside shall purchase shares of
the Company's Common Stock and Preferred Stock and the Warrant pursuant to the
Stock and Warrant Purchase Agreement dated as of the date hereof between the
Company and the Persons named therein (the "Purchase Agreement"), XxXxxxxxxx,
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Xxxxxx and Xxxxxxxxx shall purchase shares of the Company's Common Stock and
Preferred Stock pursuant to a Management Agreement dated as of the date hereof
between the Company and each of XxXxxxxxxx, Xxxxxx and Xxxxxxxxx (each a
"Management Agreement"), and Xxxxxxx and Xxxxxxx shall purchase shares of the
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Company's Common Stock and Preferred Stock pursuant to the Investors Purchase
Agreement dated as of the date hereof between the Company, Xxxxxxx and Xxxxxxx
(the "Investors Purchase Agreement");
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WHEREAS, the Company and the Stockholders desire to enter into this
Agreement for the purposes, among others, of (i) establishing the composition of
the Company's Board of Directors (the "Board"), (ii) assuring continuity in the
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management and ownership of the Company and (iii) limiting the manner and terms
by which the Company's Common Stock and Preferred Stock may be transferred. The
execution and delivery of this Agreement is a condition to the obligation of the
Liberty Investors and Riverside to purchase shares of the Company's stock
pursuant to the Purchase Agreement.
NOW, THEREFORE, in consideration of the mutual covenants contained
herein and other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties to this Agreement hereby agree as
follows:
1. Board of Directors.
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(a) Election of Directors. From and after the Closing (as defined in
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the Purchase Agreement) and until the provisions of this Section 1 cease to be
effective, each holder of Stockholder Shares shall vote all of such holder's
Stockholder Shares (to the extent such shares are voting shares) and shall take
all other reasonably necessary or desirable actions within such holder's control
(whether in such holder's capacity as a stockholder or otherwise, and including,
without limitation, attendance at meetings in person or by proxy for purposes of
obtaining a quorum and execution of written consents in lieu of meetings), and
the Company shall take all reasonably
necessary or desirable actions within its control (including, without
limitation, calling special board and stockholder meetings), so that:
(i) the authorized number of directors on the Board shall
initially be established at six directors and may, at the option of the
Liberty Investors, be increased to eight directors;
(ii) the following individuals shall be elected to the Board:
(A) two representatives designated by the Liberty Investors
(the "Liberty Directors");
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(B) two representatives designated by Riverside (the
"Riverside Directors");
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(C) two, and at the option of the Liberty Investors up to
four, representatives designated by the Liberty Directors (the "Other
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Directors"); provided Xxxxxxx and XxXxxxxxxx shall each serve as Other
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Directors and may only be removed in accordance with the provisos set
forth in Section 1(v) below;
(iii) the composition of the board of directors of each of the
Company's Subsidiaries (a "Sub Board") shall be the same as that of the
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Board;
(iv) any committees of the Board or a Sub Board shall be created
only upon the approval of all of the Liberty Directors and the Riverside
Directors; provided that a compensation committee and an audit committee
shall be established, the composition of which shall be subject to the
approval of all of the Liberty Directors and the Riverside Directors;
(v) the removal from the Board or a Sub Board (with or without
cause) of any representative designated hereunder shall be only upon the
written request of the Person or Persons entitled to designate such
representative pursuant to Section 1(a)(ii) above and under no other
circumstances; provided that if XxXxxxxxxx ceases to be an employee of the
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Company and its Subsidiaries for any reason, he may, at the option of the
Liberty Investors, be removed as a director at any time thereafter; and
provided further, that if at any time Spanier together with his Family
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Group (as hereinafter defined) owns less than 80% of the Stockholder Shares
that Spanier owns as of the date hereof, he may, at the option of the
Liberty Investors, be removed as a director; and
(vi) in the event that any representative designated pursuant to
Section l(a)(ii) above ceases to serve as a member of the Board or a Sub
Board during his term of office, the resulting vacancy on the Board or the
Sub Board shall be filled by a representative designated by the Person or
Persons entitled to designate such representative pursuant to Section
l(a)(ii) above.
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(b) Director Expenses. The Company shall pay the reasonable out-of-
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pocket expenses incurred by each director in connection with attending the
meetings of the Board, any Sub Board and any committee thereof.
(c) Termination of Provisions. Unless extended by the holders of at
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least 65% of the Stockholder Shares then outstanding, the provisions of this
Section 1 shall terminate automatically and be of no further force and effect
upon the earlier to occur of (i) the consummation of a Qualified Public Offering
or (ii) on the tenth anniversary of the date hereof.
(d) Failure to Designate. If any party fails to designate a
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representative to fill a directorship pursuant to the terms of this Section 1,
the individual previously holding such directorship shall be elected to such
position, or if such individual fails or declines to serve as a director, the
election of an individual to such directorship shall be accomplished in
accordance with the Company's Bylaws and applicable law; provided that the
Stockholders shall vote to remove such individual so elected if the party which
failed to designate such directorship so directs.
(e) Company Guidelines. At the first meeting of the Board after the
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date of this Agreement, the Board shall adopt a set of standards of business
conduct which shall establish reasonable and prudent policies and guidelines for
the Company and its Subsidiaries and their employees (including, without
limitation, with respect to the following matters: conflicts of interest,
ethical practices, trade regulation and competitive practices, payment and
procurement policies, legal compliance, employment discrimination, sexual
harassment and environmental management).
(f) Voting Authority of Directors. With respect to each matter
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submitted for a vote by the directors on the Board, each of the Liberty
Directors shall be entitled to cast four votes and all other directors shall be
entitled to cast one vote as provided in the Company's certificate of
incorporation.
2. Stockholder Representations, Warranties and Covenants.
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(a) Representations. Each Stockholder represents and warrants that
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(i) such Stockholder is the record owner of the number of Stockholder Shares set
forth opposite its name on the Schedule of Stockholders attached hereto, (ii)
this Agreement has been duly authorized, executed and delivered by such
Stockholder and constitutes the valid and binding obligation of such
Stockholder, enforceable against such Stockholder in accordance with its terms,
and (iii) such Stockholder has not granted and is not a party to any proxy,
voting trust or other agreement which is inconsistent with, conflicts with or
violates any provision of this Agreement.
(b) Covenants. No holder of Stockholder Shares shall grant any proxy
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or become party to any voting trust or other agreement which is inconsistent or
conflicts with or violates any provision of this Agreement.
3. Restrictions on Transfer of Stockholder Shares.
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(a) Transfer of Stockholder Shares. No holder of Stockholder Shares
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shall sell, transfer, assign, pledge or otherwise dispose of (whether with or
without consideration and whether voluntarily or involuntarily or by operation
of law) any interest in any Stockholder Shares (a "Transfer"), except pursuant
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to Section 4 or a Public Sale (collectively, "Exempt Transfers") or
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pursuant to this Section 3; provided that in no event shall any Transfer of
Stockholder Shares pursuant to this Section 3 be made for any consideration
other than cash payable upon consummation of such Transfer or in installments
over time, and no Stockholder Shares may be pledged. No holder of Stockholder
Shares shall consummate any Transfer (other than an Exempt Transfer) until after
the delivery to the Company and the other holders of Stockholder Shares of such
holder's Offer Notice or Sale Notice (if any), and after the expiration of all
periods provided for in Sections 3(b) and (c), unless the parties to the
Transfer have been finally determined pursuant to this Section 3 prior to the
expiration of such periods.
(b) First Offer Right. At least 40 days prior to any Transfer of any
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Stockholder Shares by any Stockholder other than the Liberty Investors (other
than an Exempt Transfer), the transferring holder (the "Transferring
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Stockholder") shall deliver a written notice (an "Offer Notice") to the Company
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and to all holders of not less than 5% of the aggregate Stockholder Shares (such
5% holder is referred to herein as an "Eligible Stockholder"). The Offer Notice
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shall disclose in reasonable detail the proposed class and number of Stockholder
Shares to be transferred (the "Offered Shares"), the proposed terms and
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conditions of the Transfer and the identity of the prospective transferees (if
known). First, the Company may elect to purchase all (but not less than all) of
the Offered Shares at the price and on the terms specified in the Offer Notice
by delivering written notice of such election to the Transferring Stockholder
and the other Eligible Stockholders as soon as practical but in any event within
15 days after delivery of the Offer Notice by the Transferring Stockholder. If
the Company has not elected to purchase all of the Offered Shares within such 15
day period, each Eligible Stockholder may elect to purchase all (but not less
than all) of such Eligible Stockholder's pro rata share of the Offered Shares
(based on such holder's proportionate ownership of all shares of such class of
Stockholder Shares owned by all Eligible Stockholders other than the
Transferring Stockholder) at the price and on the terms specified in the Offer
Notice by delivering written notice of such election to the Transferring
Stockholder and the other Eligible Stockholders as soon as practical but in any
event within 30 days after delivery of the Offer Notice by the Transferring
Stockholder. If the Eligible Stockholders have in the aggregate elected to
purchase less than all of the Offered Shares, the Offered Shares which the
Eligible Stockholders have not elected to purchase (the "Remaining Offered
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Shares") shall be reoffered to the Eligible Stockholders who have elected to
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purchase Offered Shares for an additional 5 day period, and each Eligible
Stockholder may elect to purchase all (but not less than all) of such Eligible
Stockholder's pro rata share of all Remaining Offered Shares (based on such
holder's proportionate ownership of all shares of such class of Stockholder
Shares owned by the Eligible Stockholders who have elected to purchase Remaining
Offered Shares). If the Company or any Eligible Stockholders have elected to
purchase all of the Offered Shares (including all of the Remaining Offered
Shares (if any)), the transfer of such shares shall be consummated as soon as
practical after the delivery of the election notice to the Transferring
Stockholder, but in any event within 30 days after the expiration of the last
applicable election period. If neither the Company nor the Eligible Stockholders
have elected to purchase all of the Offered Shares (including all of the
Remaining Shares), then the Transferring Stockholder may, within 90 days after
the expiration of the last applicable election period, subject to the provisions
of Section 3(c) below, transfer Stockholder Shares to one or more third parties
at a price not less than the price per share specified in the Offer Notice and
on other terms no more favorable in any material respect to the transferees
thereof than specified in the Offer Notice. Any Stockholder Shares not
transferred within such 90-day period shall be reoffered to the Company and the
Eligible Stockholders under this Section 3(b) prior to any subsequent Transfer.
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The Company shall maintain at all times during the term of this Agreement a list
of all Eligible Stockholders and shall furnish such list to any Stockholder
promptly upon request.
(c) Participation Rights. At least 40 days prior to any Transfer of
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Stockholder Shares (other than an Exempt Transfer or a Transfer pursuant to
Section 3(b)) by the Liberty investors or by a Transferring Stockholder (in the
event such Transferring Stockholder has not sold all of the Offered Shares to
the Company or to the Eligible Stockholders as provided in Section 3(b)), then
such Stockholder (the "Selling Stockholder") shall deliver a written notice (the
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"Sale Notice") to the Company and the other holders of Stockholder Shares (the
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"Other Stockholders"), specifying in reasonable detail the identity of the
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prospective transferee(s), the class and number of shares to be transferred and
the terms and conditions of the Transfer (which notice may be the same notice
and given at the same time as the Offer Notice under Section 3(b)). The Other
Stockholders may elect to participate in the contemplated Transfer at the same
price per share and on the same terms by delivering written notice to the
Selling Stockholder within 30 days after delivery of the Sale Notice. If any
Other Stockholders have elected to participate in such Transfer, the Selling
Stockholder and such Other Stockholders shall each be entitled to sell in the
contemplated Transfer, at the same price and on the same terms, a number of
Stockholder Shares of a particular class equal to the product of (i) the
quotient determined by dividing the percentage of such class of Stockholder
Shares owned by such Person by the aggregate percentage of such class of
Stockholder Shares owned by the Selling Stockholder and the Other Stockholders
participating in such sale and (ii) the number of the class of Stockholder
Shares to be sold in the contemplated Transfer.
For example (by way of illustration only), if the Sale Notice contemplated a
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sale of 100 shares of Common Stock by the Selling Stockholder, and if the
Selling Stockholder at such time owns 30% of all shares of Common Stock and
if one Other Stockholder elects to participate and owns 20% of all shares of
Common Stock the Selling Stockholder would be entitled to sell 60 shares of
Common Stock (30%/50% x 100 shares) and the Other Stockholder would be
entitled to sell 40 shares of Common Stock (20%/50% x 100 shares).
Each Selling Stockholder shall use its best efforts to obtain the agreement of
the prospective transferee(s) to the participation of the electing Other
Stockholders in any contemplated Transfer and to the inclusion (in the case of
the Liberty Investors) of the Warrants exercisable into Stockholder Shares in
the contemplated Transfer, and no Selling Stockholder shall transfer any of its
Stockholder Shares to any prospective transferee if such prospective transferee
declines to allow the participation of the Other Stockholders or the inclusion
of the Warrants on the terms set forth in this Section 3(c). If any portion of
the Warrants is included in any Transfer of Stockholder Shares under this
Section 3(c), the purchase price for the Warrants shall be equal to the full
purchase price determined hereunder for the Stockholder Shares covered by the
portion of the Warrants to be transferred, reduced by the aggregate exercise
price for such shares. Each Stockholder selling Stockholder Shares pursuant to
this Section 3(c) shall pay its pro rata share (based on the number of the class
of Stockholder Shares to be sold) of the expenses incurred by the Stockholders
in connection with such transfer and shall be obligated to join on a pro rata
basis (based on the number of Stockholder Shares to be sold) in any
indemnification or other obligations that the Selling Stockholder agrees to
provide in connection with such transfer (other than any such obligations that
relate specifically to a particular holder such as indemnification with respect
to representations and warranties given by a holder regarding such holder's
title to and ownership of Stockholder Shares); provided that no holder
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shall be obligated in connection with such Transfer to agree to indemnify or
hold harmless the prospective transferees) with respect to an amount in excess
of the net cash proceeds paid to such holder in connection with such Transfer.
(d) Permitted Transfers. The restrictions set forth in this Section
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3 shall not apply with respect to any Transfer of Stockholder Shares by any
holder (i) in the case of an individual, pursuant to applicable laws of descent
and distribution or among such individual's Family Group or (ii) in the case of
any other Person, to or between its Affiliates (collectively referred to herein
as "Permitted Transferees"); provided that the restrictions contained in this
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Section 3 shall continue to be applicable to the Stockholder Shares after any
such Transfer and provided further that each transferee of such Stockholder
Shares shall have agreed in writing to be bound by all the provisions of this
Agreement with respect to the Stockholder Shares so transferred. In addition,
the restrictions on transfer set forth in this Section 3 shall not apply with
respect to any Transfer by any Liberty Investor of Stockholder Shares issued in
connection with the Subordinated Debt, provided such Transfer is made in
connection with the disposition of all or any portion of the Subordinated Debt
and so long as the transferee has agreed in writing to be bound by all the
provisions of this agreement with respect to the Stockholder Shares so
transferred.
(e) Termination of Restrictions. The restrictions on the Transfer of
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Stockholder Shares set forth in this Section 3 shall continue with respect to
each Stockholder Share until the earlier of (i) the completion of a Qualified
Public Offering or (ii) the date on which such Stockholder Share has been
transferred in a Sale of the Company pursuant to Section 4 or transferred in a
Public Sale.
4. Sale of Company.
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(a) Right to Seek Sale of Company. The Liberty Investors shall have
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the right to seek a Sale of the Company. In the event the Liberty Investors
desire to consummate a Sale of the Company, the Liberty Investors shall deliver
written notice to the Company and the other holders of Stockholder Shares (the
"Remaining Stockholders") setting forth the net consideration per class of
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Stockholder Share to be paid in connection with such Sale of the Company and the
terms of payment thereof (the "Company Sale Notice"). The total consideration to
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be paid to holders of Stockholder Shares shall be allocated by the Board in good
faith among the classes of Stockholder Shares; provided that holders of
Stockholder Shares representing Preferred Stock shall receive an amount equal to
the liquidation value of such Preferred Stock plus all accrued and unpaid
dividends thereon. In the event that the consideration to be paid in connection
with a Sale of the Company is other than cash payable at the Closing, the
Company Sale Notice shall be accompanied by a written determination by a
reputable investment banking firm or national accounting firm of the cash
equivalent value of the net consideration to be paid for each Stockholder Share.
If the Sale of the Company is structured as (x) a merger or consolidation, each
holder of Stockholder Shares hereby agrees to waive any dissenters rights,
appraisal rights or similar rights in connection with such merger or
consolidation or (y) a sale of stock, each holder of Stockholder Shares shall
agree to sell all of its Stockholder Shares and rights to acquire shares of
Stockholder Shares on the terms and conditions approved by the Liberty
Investors, and each holder of Stockholder Shares shall take all necessary or
desirable actions in connection with the consummation of the Sale of the Company
as reasonably requested by the Company or the Liberty Investors. Each holder of
Stockholder Shares shall pay its pro rata share (based on its share of the
aggregate proceeds paid in such Sale of the
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Company) of the expenses incurred by the holders in connection with such Sale of
the Company and shall be obligated to join on a pro rata basis (based on its
percentage share of the aggregate proceeds paid for Common Stock, warrants and
options in such Sale of the Company) in any indemnification or other obligations
that the Liberty Investors agree to provide in connection with such Sale of the
Company other than any such obligations that relate specifically to a particular
holder of Stockholder Shares such as indemnification with respect to
representations and warranties given by a holder regarding such holder's title
to and ownership of Stockholder Shares; provided that no holder shall be
obligated in connection with such Sale of the Company to agree to indemnify or
hold harmless the prospective transferees) with respect to an amount in excess
of the net cash proceeds paid to such holder in connection with such Sale of the
Company.
(b) Conditions. If a Company Sale Notice has been delivered, the
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obligation of the Remaining Stockholders to participate in any Sale of the
Company hereunder is subject to the satisfaction of the following conditions:
(i) if a Sale of the Company is a sale of capital stock of the Company, then all
holders of Stockholder Shares shall be entitled to sell all of their Stockholder
Shares and, upon consummation of a Sale of the Company (whether a sale of
capital stock of the Company or otherwise), all holders of each class of
Stockholder Shares shall receive the same form and amount of consideration per
share, including for this purpose, amounts allocated to noncompetition,
consulting and other arrangements, except for fair compensation for services
actually to be rendered after the transaction (provided that holders of
Stockholder Shares representing Preferred Stock shall receive an amount equal to
the liquidation value of such Preferred Stock plus all accrued and unpaid
dividends thereon), or if the holders of a particular class of Stockholder
Shares are given an option as to the form and consideration to be received, all
holders shall be given the same option, (ii) if any Liberty Investor or any
Affiliate thereof is a holder of debt or equity securities other than
Stockholder Shares, the Sale of the Company shall not involve the payment of any
premiums, refinancing fees or other amounts in respect of such debt or equity
securities other than any amounts payable pursuant to the terms governing such
debt or equity securities and (iii) all holders of then currently vested and
exercisable rights, options or warrants to acquire shares of Stockholder Shares,
shall be given written notice and an opportunity to either (A) exercise such
rights, options or warrants prior to the consummation of the Sale of the Company
and participate in such sale as holders of Stockholder Shares or (B) upon the
consummation of the Sale of the Company, receive in exchange for such rights,
options or warrants consideration equal to the amount determined by multiplying
(1) the same amount of consideration per share of Stockholder Shares to be
received by holders of such class of Stockholder Shares in connection with the
Sale of the Company less the exercise price per share of such class of
Stockholder Shares of such rights, options or warrants to acquire such class of
Stockholder Shares by (2) the number of shares of such class of Stockholder
Shares represented by such rights, options or warrants. For purposes of this
Section 4, all shares of Common Stock shall be treated the same as a single
class, and all shares of Preferred Stock shall be treated the same as a single
class.
(c) Termination. The provisions of this Section 4 shall terminate
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upon a Qualified Public Offering.
5. Preemptive Rights.
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(a) Pro Rata Right. If at any time after the date hereof, the
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Company proposes to issue equity securities of any kind (the term "equity
securities" shall include for these purposes any
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warrants, options or other rights to acquire equity securities and debt
securities convertible into or exchangeable for equity securities or rights to
acquire equity securities) of the Company (other than the issuance of securities
(i) upon exercise of the Warrants, (ii) to the public in a firm commitment
underwriting pursuant to a registration statement filed under the Securities
Act, (iii) in connection with an issuance by the Company of any debt other than
to any Liberty Investor or any Affiliate thereof, (iv) pursuant to the
acquisition of another corporation by the Company by merger, purchase of
substantially all of the assets or other form of reorganization or (v) to
employees of the Company and its Subsidiaries pursuant to an employee stock
option plan, stock bonus plan, stock purchase plan or other management equity
program), as to each Stockholder who then holds outstanding or issuable
Stockholder Shares, the Company shall;
(i) give written notice (the "Preemptive Right Notice") setting
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forth in reasonable detail (A) the designation and all of the terms and
provisions of the securities proposed to be issued (the "Proposed
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Securities"), including, where applicable, the voting powers, preferences
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and relative participating, optional or other special rights, and the
qualification, limitations or restrictions thereof and interest rate and
maturity; (B) the price and other terms of the proposed sale of such
securities; (C) the amount of such securities proposed to be issued; and
(D) such other information as the Stockholders may reasonably request in
order to evaluate the proposed issuance; and
(ii) offer to issue to each such Stockholder a portion of the
Proposed Securities equal to a percentage determined by dividing (x) the
number of Stockholder Shares held by or issuable to such Stockholder, by
(y) the total number of Stockholder Shares then outstanding or issuable
(such number to be set forth in the Preemptive Right Notice sent to such
Stockholder).
If the Company offers two or more securities in units, the Stockholders may only
elect to purchase such units as a whole and will not be given the opportunity to
purchase only one of the securities making up such unit. The rights under this
Section 5 with respect to the issuance of Common Stock shall only be applicable
to Stockholders holding Common Stock or rights to acquire Common Stock, and the
rights under this Section 5 with respect to the issuance of Preferred Stock
shall only be applicable to Stockholders holding Preferred Stock or rights to
acquire Preferred Stock. For purposes of this Section 5, all shares of Common
Stock shall be treated the same as a single class, and all shares of Preferred
Stock shall be treated the same as a single class.
(b) Election and Sale. Each such Stockholder shall have 30 days from
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the date of delivery of the Preemptive Right Notice (the "Preemptive Election
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Period") to elect to purchase all or any portion of the Proposed Securities
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offered to such Stockholder at the price and upon the terms set forth in the
Preemptive Right Notice by giving written notice to the Company and stating
therein the number of Proposed Securities elected to be purchased. Upon the
expiration of the Preemptive Election Period, and for 120 days thereafter, the
Company may consummate the sale of Proposed Securities not purchased by the
Stockholders at a price and upon other terms no more favorable than specified in
the Preemptive Right Notice. In the event the Company has not issued and sold
the Proposed Securities within such 120-day period, the Company shall not
thereafter issue or sell any Proposed Securities without first offering the
Proposed Securities to such Stockholders in the manner herein provided. The
election by a Stockholder not to exercise its subscription rights
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hereunder in any one instance shall not affect its right (other than in respect
of a reduction in its percentage holdings) as to any subsequent proposed
issuance. Any sale or issuance of securities by the Company without first giving
the Stockholders the rights described in this Section 5 shall be void and of no
force and effect.
(c) Termination. The provisions of this Section 5 shall terminate
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upon a Qualified Public Offering.
6. Legend. Each certificate evidencing Stockholder Shares, each
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certificate issued in exchange for or upon the transfer of any Stockholder
Shares (if such shares remain Stockholder Shares after such transfer) and each
Warrant and Option shall be stamped or otherwise imprinted with a legend in
substantially the following form:
"The securities represented by this [certificate] [instrument and the
securities issuable upon exercise hereof] are subject to certain
transfer restrictions and other terms and conditions contained in a
Stockholders Agreement dated as of June 14, 1996, among the issuer of
such securities (the "Company") and certain of the Company's
stockholders, as amended and modified from time to time. A copy of such
Stockholders Agreement shall be furnished without charge by the Company
to the holder hereof upon written request."
The Company shall imprint such legend on certificates evidencing Stockholder
Shares, Warrants and Options outstanding as of the date hereof. The legend set
forth above shall be removed from the certificates or warrants evidencing any
shares which cease to be Stockholder Shares in accordance with Section 8 hereof.
7. Transfer. Prior to transferring any Stockholder Shares (other
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than an Exempt Transfer) to any Person, the transferring holder shall cause the
prospective transferee to be bound by this Agreement and to execute and deliver
to the Company and the other holders of Stockholder Shares a counterpart of this
Agreement.
8. Definitions.
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"Affiliate" of any Person means any other Person controlling,
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controlled by or under common control with such person, any partner of any
Person which is a partnership and any member of any Person which is a limited
liability company; provided that for purposes of this Agreement, LPH, SBA and
any Affiliate thereof shall all be Affiliates of each other.
"Board" has the meaning set forth in the preamble.
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"Common Stock" means the Company's Class A Common Stock and Class B
------------
Common Stock, or, in the event that the outstanding Common Stock is hereafter
changed into or exchanged for different stock or securities of the Company, such
other stock or securities.
"Company" has the meaning set forth in the preamble.
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"Exempt Transfer" has the meaning set forth in Section 3(a).
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"Family Group" for purposes of this Agreement, means an individual's
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spouse and descendants (whether natural or adopted) and any trust solely for the
benefit of the individual and/or the individual's spouse and/or descendants.
"Independent Third Party" means any Person who, immediately prior to
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the contemplated transaction, does not own in excess of 5% of the Company's
Common Stock on a fully-diluted basis (a "5% Owner"), who is not controlling,
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controlled by or under common control with any such 5% Owner and who is not the
spouse or descendent (by birth or adoption) of any such 5% Owner or a trust for
the benefit of such 5% Owner and/or such other Persons.
"Liberty Directors" has the meaning set forth in Section 1(a).
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"Options" means the options to purchase shares of Common Stock issued
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to XxXxxxxxxx, Xxxxxxxxx and Xxxxxx pursuant to the terms of the Option
Agreements dated the date hereof.
"Other Directors" has the meaning set forth in Section 1(a).
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"Permitted Transferee" has the meaning set forth in Section 3(d).
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"Person" means any individual, a partnership, a corporation, a limited
------
liability company, 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.
"Preferred Stock" means the Company's Series A Preferred Stock and
---------------
Series B Preferred Stock.
"Public Sale" means any sale of Stockholder Shares to the public
-----------
pursuant to an offering registered under the Securities Act or to the public
through a broker, dealer or market maker pursuant to the provisions of Rule 144
adopted under the Securities Act.
"Purchase Agreement" has the meaning set forth in the preamble.
------------------
"Qualified Public Offering" means the sale in an underwritten public
-------------------------
offering registered under the Securities Act of shares of the Company's Common
Stock having an aggregate offering price of at least $30 million.
"Riverside Directors" has the meaning set forth in Section 1(a).
-------------------
"Sale of the Company" means the sale of the Company to an Independent
-------------------
Third Party or group of Independent Third Parties pursuant to which such party
or parties acquire (i) capital stock of the Company possessing the voting power
under normal circumstances to elect a majority of the Company's board of
directors (whether by merger, consolidation or sale or transfer of the Company's
capital stock) or (ii) all or substantially all of the Company's assets
determined on a consolidated basis.
"Securities Act" means the Securities Act of 1933, as amended from
--------------
time to time.
-10-
"Stockholder Shares" means (i) any Common Stock purchased or otherwise
------------------
acquired by any Stockholder, (ii) any capital stock or other equity securities
issued or issuable directly or indirectly with respect to the Common Stock
referred to in clause (i) above by way of stock dividend or stock split or in
connection with a combination of shares, recapitalization, merger, consolidation
or other reorganization, (iii) any Preferred Stock purchased or otherwise
acquired by any Stockholder and (iv) any common stock or other equity securities
issued or issuable directly or indirectly with respect to the Preferred Stock
referred to in clause (iii) above by way of a stock dividend or stock split or
in connection with a combination of shares recapitalization, merger,
consolidation or other reorganization; provided that the provisions of Sections
3 and 4 shall be applied separately to the Common Stock as a single class on the
one hand and to the Preferred Stock as a single class on the other; and provided
further that for purposes of Section 10, the Preferred Stock shall not be
considered in determining whether any provision of this Agreement, other than
provisions directly relating to the Preferred Stock, may be waived or amended.
For purposes of this Agreement, any Person who holds any Warrants or fully
vested and exercisable Options shall be deemed to be the holder of the
Stockholder Shares issuable upon exercise of such Warrants or Options. As to
any particular shares constituting Stockholder Shares, such shares shall cease
to be Stockholder Shares when they have been (x) effectively registered under
the Securities Act and disposed of in accordance with the registration statement
covering them or (y) sold to the public through a broker, dealer or market maker
pursuant to Rule 144 (or any similar provision then in force) under the
Securities Act.
"Stockholders" has the meaning set forth in the preamble together with
------------
any Permitted Transferee.
"Sub Board" has the meaning set forth in Section 1(a).
---------
"Subordinated Debt" means the indebtedness incurred by Xxxxxxx
-----------------
Technologies Inc., a Subsidiary of the Company ("Technologies") pursuant to the
------------
Senior Subordinated Debt Agreement dated as of the date hereof between
Technologies and SBA.
"Subsidiary" means, with respect to any Person, any corporation,
----------
limited liability company, partnership, association or other business entity of
which (i) if a corporation, a majority of the total voting power of shares of
stock entitled (without regard to the occurrence of any contingency) to vote in
the election of directors, managers or trustees thereof is at the time owned or
controlled, directly or indirectly, by that Person or one or more of the other
Subsidiaries of that Person or a combination thereof, or (ii) if a limited
liability company, partnership, association or other business entity, a majority
of the limited liability company, partnership or other similar ownership
interest thereof is at the time owned or controlled, directly or indirectly, by
any Person or one or more Subsidiaries of that Person or a combination thereof.
For purposes hereof, a Person or Persons shall be deemed to have a majority
ownership interest in a limited liability company, partnership, association or
other business entity if such Person or Persons shall be allocated a majority of
limited liability company, partnership, association or other business entity
gains or losses or shall be or control the managing director or general partner
of such limited liability company, partnership, association or other business
entity.
"Transfer" has the meaning set forth in Section 3(a).
--------
-11-
"Warrants" means the warrants to purchase Common Stock issued to LPH
--------
as of the date hereof.
9. Transfer In Violation of Agreement. Any Transfer or attempted
----------------------------------
Transfer of any Stockholder Shares in violation of any provision of this
Agreement shall be void, and the Company shall not record such Transfer on its
books or treat any purported transferee of such Stockholder Shares as the owner
of such shares for any purpose.
10. Amendment and Waiver. Except as otherwise provided herein, no
--------------------
modification, amendment or waiver of any provision of this Agreement shall be
effective against the Company or the holders of Stockholder Shares unless such
modification, amendment or waiver is approved in writing by the Company and the
holders of at least 65% of the Stockholder Shares, respectively; provided that
no amendment, modification or waiver of Section 2 shall be effective against any
party hereto without the written consent of such party; provided further, that
no amendment, modification or waiver of Section 1 which adversely affects the
rights of any party hereto shall be effective against such party without its
written consent; and provided further that no amendment, modification or waiver
of this Agreement which adversely affects the rights of any holder of Preferred
Stock shall be effective against such party without the written consent of
holders of at least 65% of the then outstanding shares of Preferred Stock. The
failure of any party to enforce any of the provisions of this Agreement shall in
no way be construed as a waiver of such provisions and shall not affect the
right of such party thereafter to enforce each and every provision of this
Agreement in accordance with its terms. No modification or amendment of the
certificate of incorporation of the Company with respect to the rights of the
Class A Common Stock or Class B Common Stock shall be made without the consent
of the holders of a majority of the other class of Common Stock, and no
modification or amendment of the certificate of incorporation of the Company
with respect to the rights of the Series A Preferred Stock or Series B Preferred
Stock shall be made without the consent of the holders of a majority of the
other series of Preferred Stock.
11. Limitation on Affiliate Transactions. The Stockholders hereby
------------------------------------
covenant and agree that no Stockholder or any Affiliate thereof may enter into
any transaction with the Company other than transactions negotiated on an arms-
length basis and approved by a majority of the directors other than directors
designated by such Stockholder or its Affiliate.
12. Severability. Whenever possible, each provision of this
------------
Agreement shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Agreement is held to be invalid,
illegal or unenforceable in any respect under any applicable law or rule in any
jurisdiction, such invalidity, illegality or unenforceability shall not affect
the validity, legality or enforceability of any other provision of this
Agreement in such jurisdiction or affect the validity, legality or
enforceability of any provision in any other jurisdiction, but this Agreement
shall be reformed, construed and enforced in such jurisdiction as if such
invalid, illegal or unenforceable provision had never been contained herein.
13. Entire Agreement. Except as otherwise expressly set forth
----------------
herein, this Agreement embodies the complete agreement and understanding among
the parties hereto with respect to the subject matter hereof and supersedes and
preempts any prior understandings, agreements or representations by or among the
parties, written or oral, which may have related to the subject matter hereof in
any way.
-12-
14. Successors and Assigns. Except as otherwise expressly provided
----------------------
herein, this Agreement shall bind and inure to the benefit of and be enforceable
by the Company and its successors and permitted assigns and the Stockholders and
any subsequent holders of Stockholder Shares and the respective successors and
assigns of each of them, so long as they hold Stockholder Shares.
15. Counterparts. This Agreement may be executed in multiple
------------
counterparts, each of which shall be an original and all of which when taken
together shall constitute one and the same agreement.
16. Remedies. The Company and the Stockholders shall be entitled to
--------
enforce their rights under this Agreement specifically, to recover damages by
reason of any breach of any provision of this Agreement and to exercise all
other rights existing in their favor. The parties hereto agree and acknowledge
that money damages would not be an adequate remedy for any breach of the
provisions of this Agreement and that the Company and any Stockholder may in its
sole discretion apply to any court of law or equity of competent jurisdiction
for specific performance and/or injunctive relief (without posting a bond or
other security) in order to enforce or prevent any violation of the provisions
of this Agreement.
17. Notices. Any notice provided for in this Agreement shall be in
-------
writing and shall be either personally delivered, or mailed first class mail
(postage prepaid) or sent by reputable overnight courier service (charges
prepaid) to the Company at the address set forth below and to any other
recipient at the address indicated on the Schedule of Stockholders and to any
subsequent holder of Stockholder Shares subject to this Agreement at such
address as indicated by the Company's records, or at such address or to the
attention of such other person as the recipient party has specified by prior
written notice to the sending party. Notices shall be deemed to have been given
hereunder when delivered personally, three days after deposit in the U.S. mail
and one day after deposit with a reputable overnight courier service. The
Company's address is:
Xxxxxxx Holdings Corporation
Xxx Xxxxxxx Xxxx
Xxxxxxxx, XX 00000
Attention: President
with a copy to:
Liberty Partners, L.P.
c/o Liberty Capital Partners, Inc.
1177 Avenue of the Xxxxxxxx
00xx Xxxxx
Xxx Xxxx, XX 00000-0000
Attention: Xxxxxx X. Xxxxxx
18. Governing Law. The corporate law of the State of Delaware shall
-------------
govern all issues and questions concerning the relative rights of the Company
and its stockholders. All other issues and questions concerning the
construction, validity, interpretation and enforceability of this Agreement and
the exhibits and schedules hereto shall be governed by, and construed in
accordance
-13-
with, the laws of the State of New York, without giving effect to any choice of
law or conflicts of law rules or provisions (whether of the State of New York or
any other jurisdiction) that would cause the application of the laws of any
jurisdiction other than the State of New York.
19. Business Days. If any time period for giving notice or taking
-------------
action hereunder expires on a day which is a Saturday, Sunday or legal holiday
in the state in which the Company's chief executive office is located, the time
period shall automatically be extended to the business day immediately following
such Saturday, Sunday or legal holiday.
20. Descriptive Headings. The descriptive headings of this Agreement
--------------------
are inserted for convenience only and do not constitute a part of this
Agreement.
* * * *
-14-
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on
the day and year first above written.
XXXXXXX HOLDINGS CORPORATION
By: /s/ Xxxx X. XxXxxxxxxx
-------------------------------
Its:
-------------------------------
THE STATE BOARD OF ADMINISTRATION OF FLORIDA
By: Liberty Partners, L.P.
Its: Attorney-in-Fact
By: Liberty Capital Partners, Inc.
Its: General Partner
By: /s/ Xxxxxx X. Xxxxxx
-------------------------------
Its:
-------------------------------
LIBERTY PARTNERS HOLDINGS 11, L.L.C.
By: Liberty Partners, L.P.
Its: Manager
By: Liberty Capital Partners, Inc.
Its: General Partner
By: /s/ Xxxxxx X. Xxxxxx
-------------------------------
Its:
-------------------------------
-00-
XXXXXXXXX XXXXXXX, X.X.X.
By:
-------------------------------
Its:
-------------------------------
/s/ Xxxxxxx Xxxxxxx
-----------------------------------
XX. XXXXXXX XXXXXXX
/s/ Xxxx X. XxXxxxxxxx
-----------------------------------
XXXX X. XXXXXXXXXX
/s/ Xxxx Xxxxxxx
-----------------------------------
XXXX XXXXXXX
/s/ Xxxxxx Xxxxxx
-----------------------------------
XXXXXX XXXXXX
/s/ Xxxxxx Xxxxxxxxx
-----------------------------------
XXXXXX XXXXXXXXX
-16-
SCHEDULE OF STOCKHOLDERS
------------------------
I. Series A Preferred Stock
The State Board of Administration of Florida 44,195.29 Shares
Xxxx Xxxxxxx 800 Shares
Xxxx XxXxxxxxxx 560 Shares
Xxxxxx Xxxxxxxxx 160 Shares
Xxxxxx Xxxxxx 160 Shares
II. Series B Preferred Stock
Xxxxxxx Xxxxxxx 8,124.71 Shares
III. Class A Common Stock
Liberty Partners Holdings 11, L.L.C. 44,058.94 Shares
IV. Class B Common Stock
Riverside Xxxxxxx, L.L.C. 10,000 Shares
Xxxxxxx Xxxxxxx 17,277.10 Shares
Xxxx Xxxxxxx 978.55 Shares
Xxxx XxXxxxxxxx 684.99 Shares
Xxxxxx Xxxxxxxxx 195.71 Shares
Xxxxxx Xxxxxx 195.71 Shares
-17-
