FORM OF SHAREHOLDERS RIGHTS AGREEMENT By and between NTR ACQUISITION CO., NTR PARTNERS LLC and OCCIDENTAL PETROLEUM INVESTMENT CO. Dated _________________
FORM
OF
By
and
between
NTR
PARTNERS LLC
and
OCCIDENTAL
PETROLEUM INVESTMENT CO.
Dated
_________________
Table
of Contents
|
1.
RESTRICTIONS ON TRANSFERABILITY OF SECURITIES.
|
1
|
|
1.2
Restrictions on Transfer.
|
3
|
|
2.
COVENANTS OF THE COMPANY
|
4
|
|
2.1
Basic Financial Information.
|
5
|
|
2.2
Additional Information and Rights.
|
5
|
|
2.3
Right of First Refusal.
|
6
|
|
2.4
Exchange Right.
|
7
|
|
2.5
Tag Along Rights.
|
8
|
|
2.6
Prompt Payment of Taxes, etc.
|
9
|
|
2.7
Maintenance of Properties and Leases
|
9
|
|
2.8
Insurance
|
9
|
|
2.9
Accounts and Records
|
9
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|
2.10
Compliance with Requirements of Government Authorities
|
9
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|
2.11
Maintenance of Corporate Existence, etc
|
10
|
|
2.12
Transactions with Affiliates.
|
10
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|
2.13
Attendance at Board Meetings.
|
10
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2.14
Restrictions on Corporate Actions.
|
10
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3.
MISCELLANEOUS
|
11
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3.1
Governing Law.
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11
|
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3.2
Successors and Assigns.
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11
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3.3
Entire Agreement; Amendment; Waiver.
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12
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3.4
Notices, etc.
|
12
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3.5
Delays or Omissions.
|
12
|
|
3.6
Rights; Separability.
|
12
|
|
3.7
Titles and Subtitles
|
12
|
|
3.8
Counterparts.
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12
|
i
This
Shareholders Rights Agreement (this “Agreement”)
is made
and entered into as of the ______ day of __________, 200__ by and among NTR
ACQUISITION CO, a Delaware corporation (the “Company”),
NTR
PARTNERS LLC, a Delaware limited liability company (“Partners”),
the
other signers of this Agreement (“Additional
Holders”)
and
OCCIDENTAL PETROLEUM INVESTMENT CO., a California corporation (“Occidental”).
Recitals
WHEREAS,
Partners and the Additional Holders hold warrants under the Company’s Amended
and Restated Warrant Agreement dated January 28, 2007 between the Company and
the persons named therein and/or shares of the Company’s common stock, par value
$0.001 per share (“Common
Stock”)
issued
upon exercise thereof (the “Warrants”),
and
shares of Common Stock and possess registration rights and other rights pursuant
to a Registration Rights Agreement dated as of January 30, 2007 between the
Company, Partners, Additional Holders and the other persons named therein (the
“First
Registration Rights Agreement”);
WHEREAS,
Occidental is a party to the Series A Senior Convertible Preferred Stock
Purchase Agreement dated as of November 2, 2007 between the Company and
Occidental (the “Series
A Agreement”);
and
WHEREAS,
certain of the Company’s
and
Occidental’s obligations under the Series A Agreement are conditioned upon the
execution and delivery by Occidental and the Company of this
Agreement;
NOW,
THEREFORE, in consideration of the mutual promises and covenants set forth
herein, the parties hereto further agree as follows:
1.
RESTRICTIONS ON TRANSFERABILITY OF SECURITIES.
1.1
Certain Definitions.
As
used
in this Agreement, the following terms shall have the meanings set forth
below:
“Business
Day”
shall
mean any day, except a Saturday, Sunday or legal holiday on which banking
institutions in the City of New York are authorized or obligated by law or
executive order to close.
“Closing”
shall
have the meaning provided to such term in the Series A
Agreement.
1
“Exchange
Act”
shall
mean the Securities Exchange Act of 1934, as amended, or any similar successor
federal statute and the rules and regulations thereunder, all as the same shall
be in effect from time to time.
“Exchange
Debt”
shall
mean indebtedness for borrowed money issued by the Company or any of its
subsidiaries (including indebtedness to finance acquisitions or other
non-working capital needs), other than indebtedness incurred to finance ordinary
course working capital needs of the Company and its subsidiaries, provided
by an
institutional lender whose
loans are regulated by law (such as banks, trust companies, credit unions and
commercial loan agencies)
having
aggregate capital and surplus in excess of $1 billion.
“Holder”
shall
mean Occidental (for so long as Occidental owns any Shares) and any holder
to
whom any shares of Series A Preferred Stock have been
transferred in compliance with Section
1.2.
“Independent
Third Party”
means
any Person that (i) did not beneficially own in excess of five percent (5%)
of
the voting securities of the Company deemed outstanding (on a fully diluted
basis) as of the first anniversary of the date hereof; and (ii) does not control
and is not an controlled by or under common control with, as defined under
the
Exchange Act, any such owner.
“New
Securities”
shall
mean any capital stock (including Common Stock and preferred stock) of the
Company whether now authorized or not, and rights, options or warrants to
purchase such capital stock, and securities of any
type
whatsoever that are, or may become, convertible into, or otherwise exercisable
or exchangeable for, capital stock; provided
that the
term “New Securities” does not include (i) securities purchased under the Series
A Agreement; (ii) securities issued upon conversion of the Series A Preferred
Stock;
(iii)
securities
issued to employees, consultants, officers or directors of the Company pursuant
to any stock option, stock purchase or stock bonus plan, agreement or
arrangement approved by the Board
of
Directors; (iv) securities issued in connection with any stock split, stock
dividend or recapitalization of the Company; (v) securities issued in connection
with an acquisition (whether by stock sale, amalgamation, merger,
recapitalization, asset sale or similar transaction) of another Person; (vi)
any
right, option or warrant to acquire any security convertible into the securities
excluded from the definition of New Securities pursuant to subsections (i)
through (vi) above; or (vii)
securities issued upon
exercise of the Warrants outstanding as of the date hereof.
“Person”
shall
be construed as broadly as possible and shall include an individual,
corporation, association, partnership (including a limited liability partnership
or a limited liability limited partnership), limited liability company, estate,
trust, joint venture, unincorporated organization or a government or any
department, agency or political subdivision thereof.
2
“Replacement
Transaction”
shall
mean any replacement acquisition by the Company through a merger, capital stock
exchange, asset acquisition, stock purchase, reorganization or other similar
business combination of one or more businesses or assets in the energy business
acceptable to Occidental.
“Securities
Act”
shall
mean the Securities Act of 1933, as amended, or any similar successor federal
statute and the rules and regulations thereunder, all as the same shall be
in
effect from time to time.
“Series
A Preferred Stock”
shall
mean the Company’s Series A Senior Convertible Preferred Stock, $0.0001 par
value per share.
“Shares”
shall
mean shares of the Company’s Series A Preferred Stock or shares of Common Stock
issued on conversion of the Series A Preferred Stock.
“Transaction”
shall
mean the acquisition, directly or indirectly, by the Company of all outstanding
shares of each class of common stock of ▇▇▇▇ Oil & Refining Co., a
California corporation, from ▇▇▇▇▇ Co., a California Corporation pursuant to
the
▇▇▇▇ Purchase Agreement (as defined in the Series A Agreement).
1.2
Restrictions on Transfer.
(a)
Each
Holder agrees not to make any disposition of all or any portion of the Shares
prior to the date that is six (6) months after the Closing, without the consent
of the Company, except to any transferee who, within
the meaning of the Securities Act, is controlling, controlled by or under common
control with, any such Holder,
and
shall not make any such disposition unless and until the transferee has agreed
in writing for the benefit of the Company to be bound by this Section
1.2,
provided and to the extent such Section is then applicable (i.e. clause (i)
below is not applicable), and:
(i) There
is
then in effect a registration statement under the Securities
Act
covering such proposed disposition and such disposition is made in
accordance with such registration statement; or
(ii) (A)
Such
Holder shall have notified the Company of the proposed disposition and shall
have furnished the Company with a statement of the circumstances surrounding
the
proposed disposition, and (B) if reasonably requested by the Company, such
Holder shall have furnished the Company with an opinion of counsel, reasonably
satisfactory to the Company, that such disposition will not require registration
of such Shares under the Securities Act. It is agreed that the Company will
not
require opinions of counsel for transactions made pursuant to Rule
144.
(iii) Notwithstanding
the provisions of paragraphs (i) and (ii) above, no such registration
statement or opinion of counsel shall be necessary for a transfer by a Holder
to
a
Person that is, within the meaning of the Securities Act, controlling,
controlled by or under common control with, any such Holder; provided
the
transferee will be subject to the terms of this Section
1.2
to the
same extent as if such transferee were an original Holder
hereunder.
3
(b) Each
certificate representing Shares shall (unless otherwise permitted by the
provisions of this Agreement) be stamped or otherwise imprinted with a legend
substantially similar to the following (in addition to any legend required
under
applicable state securities laws):
THE
TRANSFER OF THE SHARES REPRESENTED HEREBY IS RESTRICTED BY THE TERMS OF A
SHAREHOLDERS RIGHTS AGREEMENT, DATED AS OF _________, 200_, A COPY OF WHICH
IS
ON FILE WITH THE COMPANY. NO TRANSFER SHALL BE EFFECTIVE UNLESS AND UNTIL THE
TERMS AND CONDITIONS OF SUCH SHAREHOLDERS RIGHTS AGREEMENT HAVE BEEN COMPLIED
WITH IN FULL.
THE
SHARES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT
OF
1933, AS AMENDED, AND MAY NOT BE SOLD OR TRANSFERRED, ASSIGNED, PLEDGED OR
HYPOTHECATED UNLESS AND UNTIL REGISTERED UNDER SUCH ACT OR UNLESS THE COMPANY
HAS RECEIVED AN OPINION OF COUNSEL OR OTHER EVIDENCE, SATISFACTORY TO THE
COMPANY AND ITS COUNSEL, THAT SUCH REGISTRATION IS NOT REQUIRED.
(c) The
Company shall be obligated to promptly reissue unlegended certificates at the
request of any Holder thereof if the Holder shall have obtained an opinion
of
counsel at such Holder’s expense (which counsel may be counsel to the Company)
reasonably acceptable to the Company to the effect that the securities proposed
to be disposed of may lawfully be so disposed of without registration,
qualification or legend.
(d) Any
legend endorsed on an instrument pursuant to applicable state securities
laws and the stop-transfer instructions with respect to such securities
shall
be
removed upon receipt by the Company of an order of the appropriate blue sky
authority authorizing such removal.
2.
COVENANTS OF THE COMPANY
The
Company hereby covenants and agrees, so long as any shares of Series A Preferred
Stock are outstanding, as follows:
4
2.1
Basic Financial Information. The
Company will furnish the following reports to each Holder that owns at least
ten
percent (10%) of the Shares:
(a) As
soon
as practicable after the end of each fiscal year of the Company, and in any
event within ninety (90) days thereafter, a consolidated balance sheet
of
the Company and its subsidiaries, if any, as at the end of such fiscal
year,
and
consolidated statements of income and cash flows of the Company and its
subsidiaries, if any, for such year, prepared in accordance with generally
accepted accounting principles consistently applied and setting forth in each
case in comparative form the figures for the previous fiscal year, all in
reasonable detail and certified by independent public accountants of recognized
national standing selected by the Company.
(b) As
soon
as practicable after the end of the first, second, and third quarterly
accounting periods in each fiscal year of the Company, and in any event within
forty-five (45) days thereafter, a consolidated balance sheet of the Company
and
its
subsidiaries, if any, as of the end of each such quarterly period, and
consolidated
statements of income and cash flows of the Company and its subsidiaries,
if any,
for
such period and for the current fiscal year to date, prepared in
accordance
with
generally accepted accounting principles consistently applied and setting forth
in comparative form the figures for the corresponding periods of the previous
fiscal year, subject to changes resulting from normal year-end audit
adjustments, all in reasonable detail and certified by the principal financial
or accounting
officer of the Company, except that such financial statements need
not
contain
the notes required by generally accepted accounting principles.
(c) The
Company may satisfy the provisions of Sections
2.1(a)
and
(b)
by
filing its annual and quarterly reports using the Securities and Exchange
Commission’s ▇▇▇▇▇ System as required, and at the time required to be filed, by
the Exchange Act.
2.2
Additional Information and Rights.
(a) The
Company will permit any Holder that owns at least seventy-five percent (75%)
of
the Shares (as presently constituted and subject to subsequent adjustment for
stock splits, stock dividends, reverse stock splits, recapitalizations and
the
like) (a “Significant
Holder”),
or a
representative of any Significant Holder, to visit and inspect any of the
properties of the Company, including its books of account and other records
(and
make copies thereof and take extracts therefrom), and to discuss its affairs,
finances and accounts with the Company’s officers and its independent public
accountants, upon reasonable advance notice, all at such reasonable times and
as
often as any such person may reasonably request.
(b) The
Company will deliver the reports described below in this Section
2.2
to each
Significant Holder, who so requests in writing, with reasonable promptness,
such
other information and data with respect to the Company and its subsidiaries
as
any such Significant Holder may from time to time reasonably
request.
(c) The
provisions of Section
2.1
and this
Section
2.2
shall
not be in limitation of any rights which any Holder or Significant Holder may
have with respect to the books and records of the Company, or to inspect its
properties or discuss its affairs, finances and accounts, under the laws of
the
State of Delaware.
5
(d) Anything
in Section
2.2
to the
contrary notwithstanding, no Holder by reason of this agreement shall have
access to any trade secrets or confidential information of the Company. Each
Holder hereby agrees to hold in confidence and trust
and
not to misuse or disclose any confidential information provided
pursuant
to this
Section
2.2, provided,
however,
(i)
that
in the event a Holder or any of its representatives are requested in a legal
proceeding (by deposition, interrogatories, requests for information or
documents in legal proceedings, subpoena, civil investigative demand or other
similar process) to disclose any of information, the Holder shall give the
Company prompt notice of such request so that the Company may seek a protective
order or other similar relief with respect to such disclosure so as to maintain
the confidential nature of the information to be disclosed after which the
Holder may make required disclosures, (ii) that in the event that a Holder
or
its representatives are otherwise required by law or stock
exchange regulations or by a governmental order, decree, regulation
or rule
or legal process
to
disclose any of the information, the Holder shall give the Company notice of
the
information to be disclosed and such opportunity as is reasonably practicable
to
review the proposed disclosure and to comment thereon after which the Holder
may
make required disclosures, and (iii) the Company recognizes that the Holder
and
its representatives may
retain mental impressions of the information and that such Persons may, now
or
in the future, be working on other projects, whether or not related to the
Company and, consequently, notwithstanding anything in this Agreement, the
parties agree that such Persons will not be precluded from working on such
other
projects solely because of the retained mental impressions of the
information.
2.3
Right of First Refusal.
(a)
The
Company hereby grants to each Holder who owns
any
shares
of Series
A Preferred Stock
the
right of first refusal to purchase a pro rata share of New Securities that
the
Company may, from time to time, propose
to sell
and issue. A Holder’s pro rata share, for purposes of this right of first
refusal,
is
the ratio of the sum of (i) the number of Shares owned by such Holder
immediately prior to the issuance of New Securities, assuming full
conversion of
the
Series A Preferred Stock held by the Holder and (ii) any New Securities
previously purchased by the Holder under this Section
2.3(a)
and
owned by such Holder immediately prior to the issuance of New Securities
(collectively, “Base
Securities”),
assuming full conversion, exercise or exchange, if any is possible, of such
New
Securities, to the total
number of shares of Common Stock outstanding immediately prior to the
issuance
of
New Securities, assuming full conversion, exercise or exchange of the Base
Securities and exercise of
all
other outstanding convertible securities, rights, options and warrants to
acquire Common
Stock of the Company. Each Holder shall have a right of
over-allotment such
that
if any Holder fails to exercise its right hereunder to purchase its pro
rata
share of
New Securities, the other Holders may purchase the non-purchasing Holder’s
portion on a pro rata basis within five (5) days from the date such
non-purchasing Holder fails to exercise its right hereunder to purchase its
pro
rata share of New Securities.
6
(b) In
the
event the Company proposes to undertake an issuance of New Securities, it shall
give each Holder written notice of its intention, describing the type of New
Securities, and their price and the general terms upon which the Company
proposes to issue the same. Each Holder shall have ten (10) Business Days after
any such notice is mailed or delivered to agree to purchase such Holder’s pro
rata share of such New Securities for the price and upon the terms specified
in
the notice by giving written notice to the Company and stating therein the
quantity of New Securities to be purchased.
(c) In
the
event the Holders fail to exercise fully the right of first refusal within
said
ten (10) Business Day period and after the expiration of the five (5)Business
Day period for the exercise of the over-allotment provisions of this
Section
2.3,
the
Company shall have one hundred fifty (150) days thereafter to sell to sell
the
New Securities respecting which the Holders’ right of first refusal option set
forth in this Section
2.3
was not
exercised, at a price and upon terms no more favorable to the purchasers thereof
than specified in the Company’s notice to Holders pursuant to Section
2.3(b).
In the
event the Company has not sold the New Securities in accordance with the
foregoing within one hundred fifty (150) days from the expiration of the ten
(10)Business Day period for the exercise of the over-allotment provisions,
the
Company shall not thereafter issue or sell any New Securities, without first
again offering such securities to the Holders in the manner provided in
Section
2.3(b).
(d) The
right
of first refusal set forth in this Section
2.3
may not
be assigned or transferred, except that (i) such right is assignable by each
Holder to any wholly owned subsidiary or parent of, or to any Person that is,
within the meaning of the Securities Act, controlling, controlled by or under
common control with, any such Holder, and (ii) such right is assignable between
and among any of the Holders.
2.4
Exchange Right.
The
Company hereby grants to Occidental the right, during the period ending on
the
date that is two (2) years after the Closing, to exchange Series A Preferred
Stock for Exchange Debt that the Company may, from time to time, propose to
sell
and issue as set forth in this Section
2.4.
In the
event the Company proposes to incur Exchange Debt, it shall give Occidental
written notice of its intention, describing the type of Exchange Debt, and
its
interest rate and the general terms upon which the Company proposes to incur
the
same. Occidental may exercise the exchange right set forth in this Section
2.4
(the
“Exchange
Right”)
by
providing written notice to the Company of its election and the aggregate
liquidation preference of the Series A Preferred Stock it elects to exchange
not
less than 10 Business Days prior to the incurrence of such Exchange Debt. If
Occidental exercises the Exchange Right, the Company will issue Exchange Debt
to
Occidental in an aggregate principal amount equal to the aggregate liquidation
preference of the Series A Preferred Stock indicated in the election notice
upon
surrender by Occidental of certificates representing Series A Preferred Stock
at
least equal to those noted in the exchange notice. If Occidental surrenders
certificates representing excess shares of Series A Preferred Stock, the Company
will provide a replacement certificate to Occidental representing such excess
shares.
7
2.5
Tag Along Rights.
(a)
If
Partners, Additional Holders or any of their respective successors and assigns
desire (“Prospective
Sellers”)
to
effect any sale or transfer (other than a sale or transfer to the public
pursuant to a registration statement or Rule 144 under the Securities Act)
of
any Warrants or Common Stock to any Independent Third Party which (when
aggregated with all prior such sales or transfers) represents more than
1,000,000 shares of Common Stock (assuming exercise of all the Warrants) (a
“Tag
Along
Transaction”),
then,
for so long as Occidental beneficially owns any shares of Series A Preferred
Stock, Prospective Sellers shall give written notice to Occidental offering
Occidental the option to participate in the Tag
Along
Transaction (a “Sale
Notice”),
not
less than seven (7) Business Days prior to the date of closing of such Tag
Along
Transaction. The Sale Notice shall set forth the material terms of the proposed
Tag
Along
Transaction and identify the contemplated transferee(s).
(b)
Occidental may, by written notice to Prospective Sellers (a “Tag
Along Notice”)
delivered within three (3) Business Days after the date of the Sale Notice,
elect to sell in such Tag
Along
Transaction any shares of Series A Preferred Stock held by it.
(c)
If
Occidental fails to deliver a timely Tag
Along
Notice,
then Prospective Sellers, may thereafter consummate the Tag
Along
Transaction at the same price and on substantially the same terms and conditions
as are described in the Sale Notice (including, without limitation, the number
of shares of Common Stock being directly or indirectly sold). If Occidental
gives Prospective Sellers a timely Tag
Along
Notice,
then Prospective Sellers shall use all reasonable efforts to cause the
prospective transferee(s) to agree to acquire all Series A Preferred Stock
identified in the Tag
Along
Notice,
upon the same terms and conditions as are applicable to the Warrants or Common
Stock held by Prospective Sellers (using an as-converted comparison of the
Warrants and the Series A Preferred Stock and accounting for the fact that
the
Series A Preferred Stock has been paid). If such prospective transferee is
unable or unwilling to acquire all Series A Preferred Stock proposed to be
included in the Tag
Along
Transaction upon such terms, then Prospective Sellers may elect either to cancel
such Tag
Along
Transaction or to sell the maximum number of shares of Series A Preferred Stock
that such prospective transferee(s) is willing to purchase. Occidental shall
deliver any shares of Series A Preferred Stock sold in any transaction pursuant
to this Section
2.5
free and
clear of liens, encumbrances and adverse claims with respect thereto. If
Occidental participates in any such Tag Along Transaction, it shall be
responsible for its proportionate share of the costs of the Tag Along
Transaction to the extent not paid or reimbursed by the contemplated transferee
or the Company.
(d)
For
the avoidance of doubt, the terms set out in this Section
2.5
shall
not apply to any sale or transfer of any Warrants or Common Stock to any
affiliate of Prospective Sellers; provided
that
such affiliate agrees to be bound to the terms hereof with respect to such
Warrants or Common Stock.
8
2.6
Prompt Payment of Taxes, etc. The
Company will promptly pay and discharge, or cause to be paid and discharged,
when due and payable, all lawful taxes, assessments and governmental charges
or
levies imposed upon the income, profits, property or business of the Company
or
any subsidiary; provided,
however,
that
any such tax, assessment, charge or levy need not be paid if the validity
thereof shall currently be contested in good faith by appropriate proceedings
and if the Company shall have set aside on its books adequate reserves with
respect thereto; and provided,
further,
that
the Company will pay all such taxes, assessments, charges or levies forthwith
upon the commencement of proceedings to foreclose any lien which may have
attached as security therefor. The Company will promptly pay or cause to be
paid
when due, or in conformance with customary trade terms or otherwise in
accordance with policies related thereto adopted by the Company’s Board of
Directors, all other indebtedness incident to operations of the
Company.
2.7
Maintenance of Properties and Leases. The Company
will keep its properties and
those
of its subsidiaries
in good
repair, working order and
condition, reasonable
wear and tear excepted, and from time to time make all necessary and proper
repairs, renewals, replacements, additions and improvements thereto except
to
the extent failure would not result, either individually or in the aggregate,
in
any material adverse change in the assets, business, operations, properties,
prospects, or condition (financial or otherwise) of the Company (as such
business is presently conducted and as it is presently proposed to be conducted)
(“Material
Adverse Change”);
and
the Company and its subsidiaries will at all times comply with each material
provision
of
all leases to which
any
of them is a
party
or under which
any
of them occupies
property if the breach
of such
provision would reasonably be expected to have a Material Adverse
Change.
2.8
Insurance.
Except
as
otherwise decided in accordance with policies adopted by the Company’s Board of
Directors, the Company will keep its assets and those of its subsidiaries which
are of an insurable character insured by financially sound and reputable
insurers against loss or damage by fire, explosion and other risks customarily
insured against by companies in the Company’s line of business, and the Company
will maintain, with financially sound and reputable insurers, insurance against
other hazards and risks and liability to persons and property to the extent
and
in the manner customary for companies in similar businesses similarly
situated.
2.9
Accounts and Records.
The
Company will keep true records and books of account in which full, true and
correct entries will be made of all dealings or transactions
in relation to its business and affairs in accordance
with generally
accepted
accounting principles applied on a consistent basis.
2.10
Compliance with Requirements of Government Authorities.
The
Company and all its subsidiaries shall duly observe and conform to all valid
requirements of governmental authorities relating to the conduct of their
businesses or to their
properties and assets
if the
failure to observe them would reasonably be expected to result in a Material
Adverse Change.
9
2.11
Maintenance of Corporate Existence, etc.
The
Company shall, and shall cause its material subsidiaries to, maintain in full
force and effect its corporate existence, rights and franchises and all licenses
and other rights in or to use patents, processes, licenses, trademarks, trade
names or copyrights owned or possessed by it or any subsidiary and necessary
to
the conduct of their business,
the
failure of to
maintain which
would
reasonably be expected to result in a Material Adverse Change.
2.12
Transactions with Affiliates. The
Company shall not, without the approval of the disinterested members of the
Company’s Board of Directors, engage
in
any loans, leases, contracts or other transactions with any director,
officer
or key
employee of the Company, or any member of any such person’s immediate
family, including the parents, spouse, children and other relatives of any
such
person,
on terms less favorable than the Company would obtain in a transaction with
an
unrelated party, as determined in good faith by the Board of
Directors.
2.13
Attendance at Board Meetings.
So
long
as Occidental continues to beneficially own, in the aggregate, not less than
eighty percent (80%) of the Series A Preferred Stock issued under the Series
A
Agreement, Occidental shall have the right to attend all meetings of the Board
of Directors in a monitoring observer capacity, to receive notice of such
meetings and to receive the information provided by the Company to the Board
of
Directors.
2.14
Restrictions on Corporate Actions.
So
long
as Occidental beneficially owns any shares of the Series A Preferred Stock,
the
Company will not, and Partners, Additional Holders and their respective
affiliates, successors and assigns will not vote or otherwise grant approval
to,
amend the Company’s Certificate of Incorporation without the written approval of
Occidental if such amendment would change any of the rights, preferences or
privileges provided for the benefit of holders of any shares of the Series
A
Preferred Stock. Without limiting the generality of the preceding sentence,
so
long as Occidental beneficially owns any shares of the Series A Preferred Stock,
the Company will not, and Partners, Additional Holders and their respective
affiliates, successors and assigns will not, vote or otherwise grant approval
to, amend the Company’s Certificate of Incorporation without the written
approval of Occidental if such amendment would:
(i) Reduce
the dividend rates on the Series A Preferred Stock, make such dividends
non-cumulative, or defer the date from which dividends will accrue, or cancel
accrued and unpaid dividends, or change the relative seniority rights of the
holders of the Series A Preferred Stock as to the payment of dividends in
relation to the holders of any other capital stock of the Company;
(ii) Reduce
the amount payable to the holders of Series A Preferred Stock upon the voluntary
or involuntary liquidation, dissolution, or winding up of the Company, or change
the relative seniority of the liquidation preferences of the holders of the
Series A Preferred Stock to the rights upon liquidation of the holders of any
other capital stock of this Corporation;
(iii) Reduce
the Series A Preferred Stock redemption price;
10
(iv) Delay
the
Series A Preferred Stock redemption date;
(v) Make
the
Series A Preferred Stock redeemable at the option of the Company;
or
(vi) Cancel
or
modify the conversion rights of the Series A Preferred Stock.
(vii) Change
the rights of the holders of the Series A Preferred Stock to appoint directors
of the Company.
So
long
as Occidental continues to beneficially own, in the aggregate, not less than
eighty percent (80%) of the Series A Preferred Stock issued under the Series
A
Agreement, the Company will not, and Partners, Additional Holders and their
respective affiliates, successors and assigns will not vote or otherwise grant
approval to, amend the Company’s Certificate of Incorporation or By-laws without
the approval, by vote or written consent, by all of the holders of the Series
A
Preferred Stock to provide for any new class or series of capital stock having
any rights, preferences or privileges senior to or on a parity with the rights,
preferences or privileges provided for the benefit of holders of any shares
of
the Series A Preferred Stock.
3.
MISCELLANEOUS
3.1
Governing Law. This
Agreement shall be governed in all respects by the
laws
of the State of New York, as applied to agreements among New York
residents
entered into and to be performed entirely within New
York.
To the
fullest extent permitted by applicable law, each party hereto (i) agrees that
any claim, action or proceeding by such party seeking any relief whatsoever
arising out of, or in connection with, this Agreement or the transactions
contemplated hereby shall be brought only in the United States District Court
for the Central District of California and in any California State court located
in Los Angeles County and not in any other State or Federal court in the United
States of America or any court in any other country, (ii) agrees to submit
to
the exclusive jurisdiction of such courts located in the State of California
for
purposes of all legal proceedings arising out of, or in connection with, this
Agreement or the transactions contemplated hereby and (iii) irrevocably waives
any objection which it may now or hereafter have to the laying of the venue
of
any such proceeding brought in such a court and any claim that any such
proceeding brought in such a court has been brought in an inconvenient forum.
3.2
Successors
and Assigns. Except
as
otherwise expressly provided herein, the provisions hereof shall inure
to the
benefit of, and be binding upon, the successors, assigns, heirs, executors
and
administrators of the parties hereto.
11
3.3
Entire
Agreement; Amendment; Waiver. This
Agreement (including any Exhibits) constitutes the full and entire understanding
and agreement between the parties with regard to the subjects hereof. Neither
this Agreement nor any term hereof may be amended, waived, discharged or
terminated, except by a written instrument signed by the Company and Occidental
and any such amendment, waiver, discharge or termination shall be binding
on all
the holders of Shares.
3.4
Notices,
etc. Unless
otherwise provided, all notices and other communications required or permitted
under this Agreement shall be in writing and shall be mailed by United States
first-class mail, postage prepaid, sent by facsimile or delivered personally
by
hand or by a nationally recognized courier addressed to the party to be notified
at the address or facsimile number indicated for such person on the signature
page hereof, or at such other address or facsimile number as such party may
designate by ten (10) days’ advance written notice to the other parties hereto.
All such notices and other written communications shall be effective on the
date
of mailing, confirmed facsimile transfer or delivery.
3.5
Delays or Omissions. No
delay
or omission to exercise any right, power or remedy accruing to any Holder,
upon
any breach or default of the Company under this Agreement
shall
impair any such right, power or remedy of such Holder nor shall it be construed
to be a waiver of any such breach or default, or an acquiescence therein, or
of
or in any similar breach or default thereafter occurring; nor shall any waiver
of any single breach or default be deemed a waiver of any other breach or
default therefore or thereafter occurring. Any waiver, permit,
consent or approval of any kind or character on the part of any Holder of
any
breach
or default under this Agreement or any waiver on the part of any Holder of
any
provisions or conditions of this Agreement must be made in writing and shall
be
effective only to the extent specifically set forth in such writing. All
remedies, either under this Agreement or by law or otherwise afforded to any
Holder, shall be cumulative and not alternative.
3.6
Rights;
Separability. Unless
otherwise expressly provided herein, a Holder’s
rights hereunder are several rights, not rights jointly held with any of
the
other
Holders. In case any provision of the Agreement shall be invalid, illegal or
unenforceable, the validity,
legality and enforceability of the remaining provisions shall not in any way
be
affected or impaired thereby.
3.7
Titles and Subtitles.
The
titles of the paragraphs and subparagraphs of this Agreement are for convenience
of reference only and are not to be considered in construing or interpreting
this Agreement.
3.8
Counterparts. This
Agreement may be executed in any number of counterparts, each of which shall
be
an original, but all of which together shall constitute one
instrument.
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NTR
PARTNERS LLC
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OCCIDENTAL
PETROLEUM INVESTMENT CO.
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Enterprises LLC
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Address:
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Family LLLP
By:
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Address:
SEWANEE
PARTNERS III, L.P.
By:
Sewanee Ventures, its General Partner
Address: