EXHIBIT C
AGREEMENT AMONG CERTAIN SHAREHOLDERS OF
CAR MART, INC.
This Agreement is made and entered into this 27th day of April, 1992,
effective as of April 9, 1992, among XXXXXX XXXXXXXX ("Xxxxxxxx"), XXXXX X.
XXXXXXX ("Xxxxxxx"), and XXXXXX "BUD" KARSH ("Karsh") (who collectively may be
referred to herein as the "Shareholders").
RECITALS:
A. On April 9, 1992, Karsh resigned as an officer and director of Car
Mart, Inc., a Colorado corporation (the "Company").
B. As a result of such resignation, Xxxxxxxx and Xxxxxxx are the sole
executive officers of the Company, with Xxxxxxxx being the President and Chief
Executive Officer and Sandler being the Senior Vice President, Secretary and
Treasurer.
C. The Company has issued approximately 1,610,000 shares of Class A
Common Stock and 2,250,000 shares of Class B Common Stock. The Class A and
Class B Common Stock vote together as one class. The Class A Common Stock has
one vote per share while the Class B Common Stock has three votes per share.
The Shareholders are the record and beneficial owners of all issued and
outstanding shares of Class B Common Stock as follows:
Shares of Class
Name B Common Stock
---- ---------------
Xxxxxxxx 900,000
Sandler 450,000
Karsh 900,000
-------
Total 2,250,000
---------
---------
D. Each share of Class B Common Stock is convertible at any time into one
share of Class A Common Stock and automatically converts into Class A Common
Stock upon death of the record holder or transfer of such stock except under
limited circumstances.
E. The Shareholders have jointly and severally guaranteed payment of
substantial loans made to the Company and have significant interest in assuring
that the present policies of management continue to be implemented.
F. The Shareholders acknowledge and agree that it is extremely important
that voting control over the Class B Common Stock be vested in the executive
officers and principal shareholders of the Company so as to allow them to
maintain control over the business and policies of the Company, not only for
their personal benefit, but also for the benefit of all present and future
shareholders of the Company.
EXHIBIT C
NOW, THEREFORE, for and in consideration of the premises and the mutual
covenants contained herein, the shareholders agree as follows:
1. Karsh agrees to irrevocably appoint Xxxxxxxx as his proxy and
attorney-in-fact (i) to vote 50% of all shares of Class B Common Stock now owned
or hereafter acquired by Karsh and, except as stated below, any and all
securities issued in exchange therefor or received in connection therewith by
way of stock split, stock dividend or other distribution, conversion into Class
A Common Stock or otherwise; (ii) to exercise all rights of conversion available
to such securities; and (iii) to transfer such securities pursuant to the
authority provided herein (the "Xxxxxxxx Proxy"). The Xxxxxxxx Proxy shall be
in substantially the form of Exhibit A attached hereto and incorporated herein
by this reference. Karsh agrees to promptly deliver certificates evidencing the
Class B Common Stock subject to the Xxxxxxxx Proxy to Xxxxxxxx to hold in
accordance with the terms of this Agreement.
2. Karsh agrees to irrevocably appoint Sandler as his proxy and
attorney-in-fact (i) to vote 50% of all shares of Class B Common Stock now owned
or hereafter acquired by Karsh and, except as stated below, any and all
securities issued in exchange therefor or received in connection therewith by
way of stock split, stock dividend or other distribution, conversion into Class
A Common Stock or otherwise; (ii) to exercise all rights of conversion available
to such securities; and (iii) to transfer such securities pursuant to the
authority provided herein (the "Sandler Proxy"). The Sandler Proxy shall be in
substantially the form of Exhibit B attached hereto and incorporated herein by
this reference. Karsh agrees to promptly deliver certificates evidencing the
Class B Common Stock subject to the Sandler Proxy to Sandler to hold in
accordance with the terms of this Agreement.
3. The proxies and other powers granted in the Xxxxxxxx Proxy and in the
Sandler Proxy are coupled with an interest and shall be irrevocable
notwithstanding the death or disability of Karsh. All securities which are at
any time subject to the Xxxxxxxx Proxy and the Sandler Proxy shall be
collectively referred to as the "Proxy Securities."
4. Karsh agrees not to take any action or suffer or allow the taking of
any action which would or may cause conversion of the Proxy Securities and,
accordingly, agrees that, without the prior written consent of both Xxxxxxxx and
Xxxxxxx, he will not assign, transfer, convey, pledge or hypothecate all or any
portion of the Proxy Securities or any interest therein. Any actual or
attempted transfer by Karsh of all or any portion of the Proxy Securities or any
interest therein in violation of this Agreement shall be null and void.
Notwithstanding the foregoing and subject to any agreements now or hereafter
existing between Karsh and Xxxxxxxx and/or Sandler, Xxxxxxxx and Xxxxxxx agree
that Karsh may sell from time to time all or any portion of the Class A Common
Stock issuable upon conversion of the Proxy Securities; provided, however, that
in order to avoid undue disruption in the public market for the Class A Common
Stock, Karsh agrees that all such sales will be in accordance with all
requirements of Rule 144 under the Securities Act as if Karsh were an affiliate
of the Company and continued to be an affiliate of the Company at all times
during the term of this Agreement. Xxxxxxxx and Xxxxxxx agree to use reasonable
efforts to cause conversion of the Proxy Securities as from time to time
required in connection with sales of the Class A Common Stock by Karsh
authorized hereby so long as Karsh gives them reasonable advance notice of any
such sales.
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EXHIBIT C
5. Karsh agrees that at any time, with or without notice to him, Xxxxxxxx
and Xxxxxxx may transfer any portion or all of the Proxy Securities to one or
more voting trusts, the sole voting trustees of which shall be Xxxxxxxx and/or
Sandler as they may agree. The voting trustee(s) shall forthwith cause the
voting trust to issue to Karsh voting trust certificates indicating Karsh as
sole beneficial owner of the Proxy Securities held by the trust. Any such trust
shall have a term of ten years and shall automatically be renewed for successive
ten-year periods unless terminated by either Karsh or any one or more of the
voting trustees not less than six months prior to expiration of the then
ten-year period. The voting trust agreement shall contain provisions allowing
Karsh to sell Class A Common Stock as provided herein.
6. The Shareholders acknowledge that counsel for the Company has prepared
this Agreement and has advised each Shareholder to retain his own separate legal
counsel to advise him in connection herewith. Each Shareholder acknowledges
that legal counsel for the Company does not and cannot represent him in
connection with the negotiation, preparation, execution and consummation of this
Agreement and all transactions contemplated hereby.
7. (i) This Agreement sets forth the understanding of the parties and
supersedes all prior written or oral understandings and agreements and may be
modified only by a writing signed by all parties; (ii) No party hereto shall
have the right to assign all or any portion of his or its interest in this
Agreement to any other person. Subject to the foregoing, all terms and
provisions of this Agreement shall be binding upon and inure to the benefit of
and be enforceable by the successors, assigns, legal representatives, heirs and
estates of the parties hereto; (iii) This Agreement shall be governed by and
construed in accordance with the laws of the State of Colorado; (iv) The failure
of any party to insist in any one or more instances upon performance of any
terms or conditions of this Agreement shall not be construed as a waiver of
future performance of such or any other term, covenant or condition; (v) In the
event any party takes legal action against any other party in order to enforce
the terms of this Agreement, the party in whose favor a final judgment is
rendered shall be entitled to recover from the other party his or its reasonable
attorneys' fees and costs to be fixed by the court which renders such judgment.
Such fees and costs shall include those incurred in connection with any appeal
or appeals; (vi) Should any term or condition of this Agreement be determined by
a court of competent jurisdiction to be void or unenforceable, all other
provisions of this Agreement shall remain in full force and effect; and (vii)
All notices required hereunder shall be deemed to have been given when in
writing upon the earlier of personal delivery or three days following deposit in
the United States mails by certified or registered mail, postage prepaid, to the
party at the addresses set forth below. Any party hereto, by notice duly given,
may change the address for the giving of notice.
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EXHIBIT C
Executed as of the day and year first set forth above, to be effective as
of April 9, 1992.
/s/Xxxxxx Xxxxxxxx
-----------------------------------
XXXXXX XXXXXXXX
0000 Xxxxx Xxxxxx Xx.
Xxxxxxxxx, Xxx. 00000
Address
/s/Xxxxx X. Xxxxxxx
-----------------------------------
XXXXX X. XXXXXXX
0000 X. Xxxx Xxx.
Xxxxxxxxx Xxxxxxxx 00000
Address
/s/Xxxxxx "Xxx" Xxxxx
-----------------------------------
XXXXXX "BUD" KARSH
00000 X. Xxxx #00
Xxxxxx, Xx. 00000
Address
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