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Exhibit 8
SHAREHOLDERS AGREEMENT
OF BLACK HILLS CORPORATION
THIS SHAREHOLDERS AGREEMENT (the "Agreement"), is made and entered into
as of June 30, 2000, by and among (i) Black Hills Corporation, a
South Dakota corporation (the "Company"), (ii) Xxxxxx X. Xxxxxxxx, an individual
("X. Xxxxxxxx"), (iii) Xxxxxxxx X. Xxxxxxx, an individual ("Xxxxxxx"), (iv)
Xxxxxx Xxxxxxxx, an individual ("Xxxxxxxx"), (v) Xxxxxxx X. Xxxxxxxx, an
individual ("X. Xxxxxxxx"), (vi) Xxxxxx Xxxxxxx, an individual ("Xxxxxxx"),
(vii) Xxxx X. Xxxxxx, Xx., an individual ("Xxxxxx", and collectively with X.
Xxxxxxxx, Fawcett, Fournier, X. Xxxxxxxx, Xxxxxxx and Xxxxxx, the "New
Shareholders"), and (viii) each other Person (defined below) who becomes a party
to this Agreement in accordance with the terms hereof.
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, the Company and the New Shareholders are party to that certain
Agreement and Plan of Merger, dated as of January 1, 2000 (the "Agreement of
Merger"), by and among the Company, Black Hills Energy Capital, Inc., a Delaware
corporation ("Newco"), Indeck Capital, Inc., a Delaware corporation ("Indeck"),
and the New Shareholders, pursuant to which Indeck was merged with and into
Newco and all of the shares of capital stock of Indeck held by the New
Shareholders were converted into the right to receive shares of Common Stock and
Preferred Stock of the Company (the "Merger").
WHEREAS, as of the date hereof, each of the New Shareholders owns shares
of Common Stock and Preferred Stock as follows:
New Shareholder Common Stock Preferred Stock
--------------- ------------ ---------------
X. Xxxxxxxx 952,785 2,480
Xxxxxxx 99,888 260
Xxxxxxxx 99,888 260
X. Xxxxxxxx 99,888 260
Xxxxxxx 99,888 260
Xxxxxx 184,410 480
WHEREAS, the parties hereto desire, among other things, to provide for
certain rights and obligations with respect to the Shares (as defined below) and
the Company as hereinafter provided.
NOW THEREFORE, the parties hereto agree as follows:
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ARTICLE I
DEFINITIONS
Section 1.1 Definitions. As used in this Agreement, the following terms
have the following meanings:
"Affiliate" as applied to any specified Person, shall mean any
other Person directly or indirectly controlling or controlled by or under direct
or indirect common control with such specified Person and, in the case of a
Person who is an individual, shall include (i) members of such specified
Person's immediate family (as defined in Instruction 2 of Item 404(a) of
Regulation S-K under the Securities Act) and (ii) trusts, the trustee and all
beneficiaries of which are such specified Person or members of such Person's
immediate family as determined in accordance with the foregoing clause (i). For
the purposes of this definition, control when used with respect to any Person
means the power to direct the management and policies of such Person, directly
or indirectly, whether through the ownership of voting securities, by contract
or otherwise; and the terms "affiliated," "controlling" and "controlled" have
meanings correlative to the foregoing. Notwithstanding the foregoing, the New
Shareholders and their Affiliates shall not be deemed Affiliates of the Company
for purposes of this Agreement.
"Agreement of Merger" shall have the meaning set forth in the recitals.
"Board of Directors" shall mean the Board of Directors of the Company.
"Charter Documents" shall mean the Restated Articles of Incorporation
and Bylaws of the Company, each as amended to the date hereof.
"Commission" shall mean the United States Securities and Exchange
Commission.
"Common Stock" shall mean the common stock of the Company.
"Company" shall have the meaning set forth in the preamble; provided,
however, in the event that the Company reorganizes to create a holding company
("Holdco") for the Company, then, for purposes of this Agreement, the term
"Company" shall mean Holdco.
"Company Nominees" shall mean the nominees to the Board of Directors
nominated by the Company other than the New Shareholders' Nominee.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended, and the rules and regulations promulgated thereunder.
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"MD&A" shall mean a management's discussion and analysis of the
Company's financial condition and results of operation comparable to the
discussion that is required to be included in periodic reports filed under the
Exchange Act.
"Merger" shall have the meaning set forth in the recitals.
"New Shareholders" shall have the meaning set forth in the preamble.
"New Shareholders' Nominee" shall have the meaning set forth in Section
2.l(a).
"New Shareholders' Representative" shall mean the Person or his or her
successor designated from time to time by the New Shareholders as its
representative for purposes of designating or requesting the removal of the New
Shareholders' Nominee.
"Offer Notice" shall have the meaning set forth in Section 6.1(a).
"Permitted Transferee" shall mean:
(a) in the case of any New Shareholder or Affiliate of such New
Shareholder, (i) any New Shareholder, (ii) any Person that is solely controlled
by such New Shareholder or Affiliate of such New Shareholder, (iii) upon a bona
fide liquidation of, or a bona fide withdrawal from, such New Shareholder or
Affiliate of such New Shareholder, in each case, not intended to avoid the
provisions of this Agreement, the shareholders, partners or principals, as the
case may be, of such New Shareholder or Affiliate of such New Shareholder, (iv)
any member or members of such New Shareholder's or Affiliate of such New
Shareholder's immediate family by gift or bequest or through inheritance or (v)
a trust in respect of which such New Shareholder or Affiliate of such New
Shareholder serves as trustee, shall retain sole and exclusive control over the
voting and disposition of shares of said Shares until the termination of this
Agreement; and
(b) any Person who is a party to this Agreement.
"Person" shall mean an individual or a corporation, limited liability
company, partnership, trust, or any other entity or organization, including a
government or political subdivision or an agency or instrumentality thereof.
"Preferred Stock" shall mean the cumulative preferred stock, no par
value, of the Company, designated by the Company's Board of Directors as Series
2000-A.
"Registration Rights Agreement" shall mean the Registration Rights
Agreement, dated as of the date hereof, by and among the Company and the New
Shareholders.
"ROFO Shares" shall have the meaning set forth in Section 6.1.
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"Securities Act" shall mean the Securities Act of 1933, as amended, and
the rules and regulations promulgated thereunder.
"Shares" shall mean the Common Stock, any other securities of the
Company entitled to vote generally for the election of directors of the Company
and any security convertible into or exchangeable for or exercisable for the
purchase of Common Stock or other securities of the Company entitled to vote
generally for the election of directors of the Company, including, without
limitation, the Preferred Stock, in each case now or hereafter outstanding.
"Subsidiary" shall mean, with respect to any Person, (a) a corporation a
majority of whose capital stock with voting power, under ordinary circumstances,
to elect directors is at the time, directly or indirectly, owned by such Person,
by a Subsidiary of such Person, or by such Person and one or more Subsidiaries
of such Person, (b) a partnership in which such Person or a Subsidiary of such
Person is, at the date of determination, a general partner of such partnership,
or (c) any other Person (other than a corporation) in which such Person, a
Subsidiary of such Person or such Person and one or more Subsidiaries of such
Person, directly or indirectly, at the date of determination thereof, has (i) at
least a majority ownership interest or (ii) the power to elect or direct the
election of the directors or other governing body of such Person.
"Transfer" shall mean (i) when used as a noun: any direct or indirect
transfer, sale, assignment, pledge, hypothecation, encumbrance or other
disposition and (ii) when used as a verb: to directly or indirectly transfer,
sell, assign, pledge, hypothecate, encumber, or otherwise dispose of; provided,
however, Transfer shall not include a pledge in connection with a recourse, bona
fide loan transaction that is not intended to avoid the provisions of this
Agreement.
"Transferee" shall mean any Person to whom Shares have been Transferred
in compliance with the terms of this Agreement.
ARTICLE II
CORPORATE GOVERNANCE AND VOTING
Section 2.1 Board of Directors of the Company.
(a) The New Shareholders (or New Shareholders' Representative) shall be
entitled, but not required, to nominate one (1) member (the "New Shareholders'
Nominee") to the Board of Directors of the Company and to the Executive
Committee thereof and any other committee which has the authority to exercise
substantially all of the power of the Board of Directors, and to the board of
directors of each direct or indirect wholly-owned Subsidiary of the Company and
to the Executive Committee thereof and any other committee which has the
authority to exercise substantially all of the powers of the board of directors
of each direct or indirect wholly-owned Subsidiary; provided, however, the New
Shareholders shall not be entitled to have a representative on the Board of
Directors, any committee thereof and the board of directors of each
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direct or indirect wholly-owned Subsidiary of the Company or any committee
thereof beyond the date of the Annual Meeting of Stockholders of the Company in
2010, and provided further, that at any time (i) prior to the fourth anniversary
of the date hereof, when the New Shareholders own less than 5% of the shares of
Common Stock outstanding on the date hereof (after giving effect to and assuming
conversion of any outstanding shares of Preferred Stock owned by them), and (ii)
after June 30, 2004, when the New Shareholders own less than 5% of the then
outstanding shares of Common Stock (after giving effect to and assuming
conversion of any outstanding shares of Preferred Stock owned by them), the New
Shareholders shall not have the right to designate any such person and the New
Shareholders shall use their best efforts to cause their designee on the Board
of Directors, any committee thereof and the board of directors of each
Subsidiary of the Company and any committee thereof to resign forthwith. The New
Shareholders' Nominee shall be classified as a Class III Director of the
Company. At and for such time, if any, that the New Shareholders as holders of
the Preferred Stock (as defined in the Company's Restated Articles of
Incorporation) are entitled to elect directors of the Company in accordance with
Article Second, Section (F) of the Company's Restated Articles of Incorporation,
the New Shareholders' Nominee shall be considered as one of the directors which
the holders of Preferred Stock (as defined in the Company's Restated Articles of
Incorporation), as a class, are entitled to elect.
(b) The Company shall take appropriate actions to cause the appointment
of the New Shareholders' Nominee to become effective upon the closing under the
Agreement of Merger. Pursuant to the provisions of Section 2.1(a), the Company
shall use its best efforts to ensure (to the extent within its control) that the
New Shareholders' Nominee is elected to the Board of Directors.
(c) The New Shareholders shall vote all of the Shares owned or held of
record by them at all regular and special meetings of the shareholders of the
Company called or held for the purpose of filling positions on the Board of
Directors, and in each written consent executed in lieu of such a meeting of
shareholders, and shall take all actions otherwise necessary to ensure (to the
extent within the New Shareholders' control) that the Company Nominees are
elected to the Board of Directors.
(d) The Company shall use its commercially reasonable efforts to call,
or cause the appropriate officers and directors of the Company to call, a
special meeting of shareholders of the Company, as applicable, for the removal
(with cause) of the New Shareholders' Nominee if the New Shareholders request
such director's removal in writing for cause. The New Shareholders shall vote
all of the Shares owned or held of record by them for, or to take all actions by
written consent in lieu of such meeting necessary to cause, the removal (with
cause) of any of the Company Nominees if the Company requests such director's
removal for cause. The Company and the New Shareholders, respectively, shall
have the right to designate a new nominee in the event any Company Nominee or
the New Shareholders' Nominee, respectively, shall be so removed under this
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Section 2.1(d) or shall vacate his or her directorship for any reason. Except as
provided in this Section 2.1(d), each party hereto agrees that, at any time that
it is then entitled to vote for the election or removal of directors, it will
not vote in favor of the removal of any Company Nominee or the New Shareholders'
Nominee unless such removal shall be at the request of the party who nominated
such director pursuant, in the case of New Shareholders, to the provisions of
Section 2.l(a).
(e) Each party hereto shall use reasonable efforts to prevent any action
from being taken by the Board of Directors, during the pendency of the vacancy
thereon due to death, resignation or removal of the New Shareholders' Nominee,
unless the New Shareholders shall have failed, for a period of ten (10) days
after notice of such vacancy, to nominate a replacement.
(f) The initial New Shareholders' Nominee shall be X. Xxxxxxxx. Any
other person subsequently designated by the New Shareholders as the New
Shareholders' Nominee shall be a person who is reasonably acceptable to the
Company. The New Shareholders shall cause the New Shareholders' Nominee to
comply with the retirement policies of the Company as in effect on the date
hereof or as hereafter amended or modified from time to time by the Board of
Directors. The New Shareholders' Nominee shall not be a then current officer or
employee of the Company or any of its Subsidiaries.
(g) Each committee of the Board of Directors, to which authority has
been delegated, shall keep complete and accurate minutes and records of all
actions taken by such committee, prepare such minutes and records in a timely
fashion and promptly distribute such minutes and records to each member of the
Board of Directors.
(h) The New Shareholders designate X. Xxxxxxxx as its initial New
Shareholders' Representative. In the event of X. Xxxxxxxx'x resignation,
incapacity or death, the New Shareholders' Representative shall be Xxxxxx.
Section 2.2 Voting on Matters Other than for Directors. Nothing in this
Agreement shall require any of the parties hereto to vote together on any matter
other than as set forth herein.
Section 2.3 Action by the Board of Directors. All decisions of the Board
of Directors shall require the affirmative vote of a majority of the directors
of the Company then in office, or a majority of the members of an Executive
Committee of the Board of Directors, to the extent such decisions may be
lawfully delegated to an Executive Committee pursuant to the Charter Documents.
Section 2.4 Charter Documents. The Company covenants that it will act
and the New Shareholders agree to use their respective commercially reasonable
efforts to cause the Company to act, in accordance with its Charter Documents in
all material respects and to cause compliance with all provisions contained
herein. The New Shareholders shall vote all the Shares owned or held of record
by them at any regular or special meeting of shareholders of the Company
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or in any written consent executed in lieu of such a meeting of shareholders,
and shall take all action necessary, to ensure (to the extent within their
control) that the Charter Documents of the Company do not, at any time, conflict
with the provisions of this Agreement.
ARTICLE III
GENERAL RESTRICTION ON TRANSFER
Section 3.1 Restriction. Except as provided for in Section 3.3 below,
for a period of two (2) years from the date of this Agreement, the New
Shareholders shall not, nor shall they permit any of their Affiliates to,
notwithstanding any other rights that the New Shareholders or their respective
Affiliates may have, directly or indirectly, offer, sell, transfer, assign or
otherwise dispose of (either pursuant to Rule 144 under the Securities Act, or
otherwise), any Shares owned by them.
Section 3.2 Effect of Purported Transfers. Any purported transfer of
Shares by a New Shareholder or Affiliate of such New Shareholder that is not in
accordance with the provisions of this Agreement shall be null and void, and
shall not operate to transfer any right, title or interest in such Shares to the
purported transferee. The Company shall not cause or permit the transfer of any
certificate representing any Shares to be made on its books unless the transfer
is permitted by this Agreement and has been made in accordance with its terms.
Section 3.3 Permitted Transferees.
(a) Prior to the second anniversary of the date of this Agreement,
no New Shareholder or Affiliate of such New Shareholder shall Transfer any
Shares except to a Permitted Transferee provided that such restriction on
transfer and Sections 3.1 and 3.2 hereof shall not apply to any pledge of the
Shares by any of the New Shareholders, or any transfers resulting from
foreclosure proceedings commenced in connection with such pledge.
(b) In the event of any such Transfer, the Transferee of the Shares
shall hold the Shares so acquired with all the rights conferred by, and subject
to all the restrictions imposed by, this Agreement and shall be deemed a New
Shareholder for all purposes hereof.
(c) No Transfer to a Permitted Transferee of any New Shareholder or
Affiliate of such New Shareholder shall be permitted unless (i) the certificates
representing such Shares issued to such Transferee shall bear the legend
provided in Section 3.4 and (ii) the Transferee (if not already a party hereto)
has executed and delivered to each other party hereto, as a condition precedent
to such Transfer, an instrument or instruments, reasonably satisfactory to the
Company, confirming that the Transferee agrees to be bound by the terms of this
Agreement in the same manner as such Transferee's transferor.
Section 3.4 Legends. Each New Shareholder hereby agrees that each
outstanding certificate representing Shares issued to any of them, or any
certificate issued in exchange for or
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upon conversion of any similarly legended certificate, shall bear a legend
reading substantially as follows:
"THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO
THE PROVISIONS OF THE SHAREHOLDERS AGREEMENT, DATED AS OF
____________, 2000, AND MAY NOT BE TRANSFERRED, SOLD OR
OTHERWISE DISPOSED OF, EXCEPT AS THEREIN PROVIDED. A COPY OF
SUCH AGREEMENT IS ON FILE AT THE OFFICES OF THE COMPANY."
The Company may enter a stop transfer order with the transfer agent or agents
for the Shares against the transfer of Shares except in compliance with the
requirements of this Agreement. The Company shall remove promptly any stop
transfer order with respect to, and issue promptly certificates without the
above legend in substitution for, certificates for any Shares that are no longer
subject to the restrictions contained in this Agreement.
ARTICLE IV
ADDITIONAL RIGHTS AND OBLIGATIONS OF
THE NEW SHAREHOLDERS AND THE COMPANY
Section 4.1 Access to Information; Confidentiality. So long as the New
Shareholders shall own any Shares, upon the request of the New Shareholders, the
Company shall afford the New Shareholders reasonable access to the books and
records of the Company and its Subsidiaries that are reasonably requested. The
New Shareholders will, and will cause their agents to, conduct any such
investigations on reasonable advance notice, during normal business hours, with
reasonable numbers of persons and in such a manner as not to interfere
unreasonably with the normal operations of the Company and its Subsidiaries.
Except as otherwise required by applicable law, neither the Company nor
any of its Subsidiaries shall be required to provide access to or to disclose
information where such access or disclosure would violate or prejudice the
rights of any customer or other Person, would jeopardize the attorney-client
privilege of the Person in possession or control of such information, or would
contravene any law, rule, regulation, order, judgment, decree, fiduciary duty or
binding agreement entered into prior to the date hereof or thereafter. The
parties hereto will make appropriate substitute disclosure arrangements under
circumstances in which the restrictions of the preceding sentence apply.
The New Shareholders shall, and shall use their commercially reasonable
efforts to cause their representatives and agents to, keep confidential all such
information to the same extent such information is treated as confidential by
the Company, and shall not directly or indirectly use such information for any
competitive or other commercial purpose. The obligation to keep such information
confidential shall not apply to (i) any information that (x) was already in the
New
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Shareholders' possession prior to the disclosure thereof by the Company (other
than through disclosure by any other Person known by the New Shareholders to be
subject to a duty of confidentiality), (y) was then generally known to the
public, or (z) was disclosed to the New Shareholders by a third party not known
by the New Shareholders to be bound by an obligation of confidentiality, or (ii)
disclosures made as required by law or legal process or to any Person exercising
regulatory authority over the New Shareholders or its Affiliates. If in the
absence of a protective order or the receipt of a waiver hereunder, the New
Shareholders are nonetheless, in the opinion of their counsel, compelled to
disclose information concerning the Company to any tribunal or governmental body
or agency or else stand liable for contempt or suffer other censure or penalty,
the New Shareholders may disclose such information to such tribunal or
governmental body or agency without liability hereunder (in which case the New
Shareholders shall advise the Company of the proposed disclosure prior to making
such disclosure). In addition, in the event that any information disclosed by
the Company to New Shareholders is material nonpublic information, the New
Shareholders agree, and agree to use their commercially reasonable efforts to
cause their representatives and agents, to comply with their respective
obligations under the applicable Federal and state securities laws with respect
thereto, including but not limited to, the laws pertaining to the possession,
dissemination and utilization of such material nonpublic information.
Section 4.2 Furnishing of Information.
(a) The Company shall deliver to the New Shareholders, so long as
the New Shareholders shall own any Shares:
(i) As promptly as practical, but in no event later than sixty
(60) days after the close of each of its first three quarterly
accounting periods during any fiscal year of the Company, the
consolidated balance sheet of the Company as at the end of such
quarterly period, and the related consolidated statements of operations,
shareholders' equity and cash flows for such quarterly period, and for
the elapsed portion of the fiscal year ended with the last day of such
quarterly period, and in each case setting forth comparative figures for
the related periods in the prior fiscal year (if such comparative
figures are available without unreasonable expense), all of which shall
be certified by the Chief Financial Officer of the Company, to have been
prepared in accordance with generally accepted accounting principles,
subject to year-end audit adjustments, together with an MD&A; and
(ii) As promptly as practical, but in no event later than one
hundred five (105) days after the close of each fiscal year of the
Company, the consolidated balance sheet of the Company as of the end of
such fiscal year and the related consolidated statements of operations,
shareholders' equity and cash flows for such fiscal year, in each case
setting forth comparative figures for the preceding fiscal year, and
certified by independent certified public accountants of recognized
national standing, together with an MD&A.
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(b) The provisions of Sections 4.2(a)(i) and (ii) above shall be
deemed to have been satisfied if (i) the Company's Common Stock is registered
pursuant to Section 12(b) or 12(g) of the Exchange Act or the Company is subject
to Section 15(d) of the Exchange Act and (ii) the Company has timely filed with
the Commission its reports on Form 10-Q or 10-K, as applicable, for such
periods.
ARTICLE V
STANDSTILL
Section 5.1 Limitation on Acquisition of Additional Shares by New
Shareholders. From the date hereof until June 30, 2004, the New Shareholders
shall not, nor shall they permit any of their Affiliates to, without Board of
Directors Written Consent (as defined below), own any Shares except for:
(a) shares of Common Stock and Preferred Stock acquired pursuant to the
Agreement of Merger;
(b) shares of Common Stock acquired upon conversion of Preferred Stock
acquired pursuant to the Agreement of Merger;
(c) shares of Common Stock and options therefor acquired by a New
Shareholder who is an officer and/or director of the Company pursuant to
employee benefit plans of the Company; and
(d) Shares acquired pursuant to any pro rata stock dividend, stock
split, exchange, recapitalization, reclassification or other distribution.
Section 5.2 Acquisition of Additional Shares. From July 1, 2004 through
the remaining term of this Agreement, without Board of Directors Written
Consent, the New Shareholders and their Affiliates shall be prohibited from
purchasing or acquiring any Shares (other than the acquisition of Shares in the
manner specified in Sections 5.1(a), (b), (c) and (d)) if immediately following
the acquisition of such Shares, the New Shareholders and their Affiliates would
own in the aggregate greater than 9.9% of the then outstanding shares of Common
Stock on a fully-diluted basis (after giving effect and assuming conversion of
all outstanding securities convertible into or exchangeable or exercisable for
Common Stock).
Section 5.3 Restrictions on Certain Actions by New Shareholders. During
the term of this Agreement, except as otherwise permitted or contemplated by the
Agreement of Merger or this Agreement, the New Shareholders shall not, nor shall
they permit any of their Affiliates to, without the prior written consent of the
Company's Board of Directors specifically expressed in a resolution adopted by a
majority of the directors of the Company who, unless the holders of Preferred
Stock (as defined in the Company's Restated Articles of Incorporation) are
entitled to elect
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a majority of the directors of the Company in accordance with Article Second,
Section (F) of the Company's Restated Articles of Incorporation, are not a
designee of the New Shareholders under Section 2.1 or designees elected by the
holders of Preferred Stock (as defined in the Company's Restated Articles of
Incorporation) in accordance with Article Second, Section (F) of the Company's
Restated Articles of Incorporation ("Board of Directors Written Consent"):
(a) acquire or offer to acquire, whether by purchase, gift, or by
joining a partnership or other "group" within the meaning of Section
13(d)(3) of the Exchange Act, any assets, businesses or properties of the
Company;
(b) (i) solicit, initiate or participate in any "solicitation" of
"proxies" relating to Shares or become a "participant" in an
"election contest" relating to the election of directors of the
Company (as such terms are defined or used in Regulation 14A
under the Exchange Act, disregarding clause (iv) of Rule
14a-1(1)(2) and including any exempt solicitation pursuant to
Rule 14a-2(b)(1)); call, or in any way participate in a call
for, any special meeting of shareholders of the Company (or take
any action with respect to acting by written consent of the
shareholders); request, or take any action to obtain or retain
any list of holders of any securities of the Company; initiate
or propose any shareholder proposal or participate in the making
of, or solicit shareholders for the approval of, one or more
shareholder proposals relating to the Company;
(ii) form, join or in any way participate in a "group" within
the meaning of Section 13(d)(3) of the Exchange Act with respect
to any Shares;
(iii) otherwise act to control or influence the Company or the
management, Board of Directors, policies or affairs of the
Company, including without limitation, (A) soliciting or
proposing to effect or negotiate any form of business
combination, restructuring, recapitalization, sale of
substantial assets or other extraordinary transaction involving,
or any change in control of, the Company, its Affiliates or any
of their respective securities or assets, (B) initiating,
proposing or participating in the making of any tender or
exchange offer for Shares, (C) seeking representation on the
Board of Directors or the removal of any directors or a change
in the composition or size of the Board of Directors or any of
the Company's Affiliates, or (D) making any request to amend or
waive any provision of this Agreement;
(iv) disclose any intent, purpose, plan or proposal with respect
to this Agreement or the Company, its Affiliates or the Board of
Directors, management, policies or affairs or securities or
assets of the Company or its Affiliates that is inconsistent
with this Agreement, including any intent, purpose, plan or
proposal that is conditioned on, or would require the
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Company or any of its Affiliates to make any public disclosure
relating to any such intent, purpose, plan, proposal or
condition; or
(v) assist, advise, encourage or act in concert with any Person
with respect to, or seek to do, any of the foregoing; or
(c) Sell or transfer any Shares to any Person or related "group" of
Persons within the meaning of Section 13(d)(3) of the Exchange Act who,
together with such Person's or "group" of Persons' Affiliates, to the
knowledge of such transferring New Shareholder, after reasonable inquiry
under the circumstances, holds or would hold Shares representing, in the
aggregate, 5% or more of the then outstanding Shares following such sale
or transfer, except (i) pursuant to (A) a tender or exchange offer for
outstanding Shares which the Board of Directors does not oppose or (B) a
merger or consolidation in which the Company is acquired or (ii) to a
Permitted Transferee.
(d) In the event that the New Shareholders or any of their Affiliates
shall receive any proposal from any Person with respect to any matter
referred to in this Section 5.3, the New Shareholders shall immediately
notify the Company of such proposal.
ARTICLE VI
RIGHT OF FIRST OFFER
Section 6.1 Right of First Offer. During the term of this Agreement,
any New Shareholder or Affiliate of such New Shareholder, prior to making any
Transfer in excess of five hundred thousand (500,000) Shares (as adjusted for
all stock dividends, stock splits, reverse stock splits, recapitalizations and
reclassifications of Common Stock prior to such Transfer) in a single
transaction or series of related transactions (the "ROFO Shares") shall comply
with the following:
(a) Any New Shareholder or Affiliate of such New Shareholder shall give
notice (the "Offer Notice") to the Company, in writing, offering to the
Company the opportunity to purchase the ROFO Shares at such cash price
specified in the Offer Notice.
(b) The Company shall have the right, exercisable by written notice
given by the Company to the party which gave the Offer Notice within five
(5) calendar days after receipt of such Offer Notice, to purchase (or to
cause a corporation, entity, person or group designated by the Company to
purchase) all, but not a part of, the Shares specified in such Offer
Notice for cash at the price set forth therein.
(c) If the Company exercises its right of first offer hereunder, the
closing of the purchase of the Shares with respect to which such right has
been exercised shall take place within 30 calendar days (or if approval of
such purchase by the Company's shareholders is required by law or pursuant
to any stock exchange rule or policy, within 90 calendar days)
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after the Company gives notice of such exercise. Upon exercise of its
right of first offer, the Company shall be legally obligated to consummate
the purchase contemplated thereby and shall use its best effort to secure
all approvals required in connection therewith.
(d) If the Company does not exercise its right of first offer hereunder
within the time specified for such exercise, the party giving the Offer
Notice shall be free during the period of one hundred eighty (180)
calendar days following the expiration of such time for exercise to sell
the Shares specified in such Offer Notice at the price specified therein
or at any price in excess thereof.
ARTICLE VII
TERMINATION
Section 7.1 Termination. Except as otherwise provided herein with
respect to certain specific provisions, this Agreement shall terminate upon the
earlier to occur of:
(a) The mutual agreement of the Company and a majority in interest of
the New Shareholders; or
(b) On the tenth anniversary of the date hereof; provided, however, that
the parties hereto may negotiate further extensions of this Agreement to
the extent permitted by law.
ARTICLE VIII
MISCELLANEOUS
Section 8.1 No Inconsistent Agreements. Each party hereto hereby
consents to the termination of any prior written or oral agreement or
understanding restricting, conditioning or limiting the ability of any party to
vote Shares.
The Company represents and agrees that, as of the date hereof, there is
no (and from and after the date hereof it will not, and will cause its
Subsidiaries and Affiliates not to, enter into any) agreement with respect to
any securities of the Company or any of its Subsidiaries (and from and after the
date hereof the Company shall not take, or permit any of its Subsidiaries or
Affiliates to take, any action) that is inconsistent in any material respect
with the rights granted to the New Shareholders in this Agreement.
Without limiting the foregoing, the Company represents that there are no
existing agreements relating to the voting or registration of any equity
securities of the Company or any of its Subsidiaries other than this Agreement
and the Registration Rights Agreement.
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Section 8.2 Successors and Assigns. This Agreement shall be binding upon
and shall inure to the benefit of the parties hereto, and their respective
successors and permitted assigns, heirs, executors, administrators and legal
representatives. Neither this Agreement nor any of the rights or obligations
hereunder shall be assigned by any of the parties hereto without the prior
written consent of the other parties, except, with respect to the New
Shareholders, in accordance with Section 3.3 hereof, and with respect to the
Company, by operation of law in any merger.
Section 8.3 No Waivers; Amendments; Enforcement.
(a) No failure or delay by any party in exercising any right, power or
privilege hereunder shall operate as a waiver thereof, nor shall any
single or partial exercise thereof preclude any other or further exercise
thereof or the exercise of any other right, power or privilege. The rights
and remedies herein provided shall be cumulative and not exclusive of any
rights or remedies provided by law.
(b) This Agreement may not be amended or modified, nor may any provision
hereof be waived, other than by a written instrument signed by the Company
and a majority in interest of the New Shareholders.
(c) The New Shareholders, on the one hand, and the Company on the other,
acknowledge and agree that irreparable damage would occur if any of the
provisions of this Agreement were not performed in accordance with their
specific terms or were otherwise breached. Accordingly, the parties hereto
shall be entitled to an injunction or injunctions to prevent breaches of
this Agreement and to enforce specifically its provisions in any court of
the United States or any state having jurisdiction, without the necessity
of furnishing a bond of any type, and the other parties hereto shall not
oppose the granting of such relief on the grounds that an adequate remedy
at law exists, this being in addition to any other remedy to which they
may be entitled to at law or equity.
Section 8.4 Notices. All notices, requests and other communications to
any party hereunder shall be in writing (including telecopier or similar
writing) and shall be given to such party at its address or telecopier number
set forth below, or such other address or telecopier number as such party may
hereinafter specify for the purpose to the party giving such notice. Each such
notice, request or other communication shall be effective (i) if given by
telecopy, when such telecopy is transmitted to the telecopy number specified in
this Section and the appropriate electronic confirmation is received, or (ii) if
given by overnight mail, twenty four (24) hours after such communication is
deposited with an overnight courier, addressed as aforesaid, or (iii) if given
by any other means, when delivered at the address specified in this Section.
To the Company:
Black Hills Corporation
000 Xxxxx Xxxxxx
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X.X. Xxx 0000
Xxxxx Xxxx, Xxxxx Xxxxxx 00000
Attention: Xx. Xxxx X. Xxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
with a copy (which shall not constitute notice) to:
Xxxxxxx Xxxxxx Xxxxxx & Xxxxx, LLP
000 Xxxxx Xxxxxx, 0xx Xxxxx
X.X. Xxx 0000
Xxxxx Xxxx, Xxxxx Xxxxxx 00000
Attention: Xxxx X. Xxxxxx, Esq.
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
To the New Shareholders:
Xxxxxx X. Xxxxxxxx
Xxxxxxxx X. Xxxxxxx
Xxxxxx Xxxxxxxx
Xxxxxxx X. Xxxxxxxx
Xxxxxx Xxxxxxx
c/o Xxxxxx X. Xxxxxxxx
Indeck Capital, Inc.
0000 Xxxx Xxxxxx
Xxxxxxxx, XX 00000
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
Xxxx X. Xxxxxx, Xx.
Indeck Capital, Inc.
0000 Xxxx Xxxxxx
Xxxxxxxx, XX 00000
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
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with a copy (which shall not constitute notice) to:
Xxxxxx, Xxxxx & Bockius LLP
000 Xxxxx Xxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxxx X. Xxxxxx, Esq.
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
Section 8.5 Inspection. So long as this Agreement shall be in effect,
this Agreement and any amendments hereto and waivers hereof shall be distributed
to all parties hereto after becoming effective and shall be made available for
inspection at the principal office of the Company by the New Shareholders.
Section 8.6 Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of South Dakota, as applied
to contracts made and performed within the State of South Dakota, without regard
to principles of conflict of laws, except as to matters of corporate governance,
which shall be interpreted in accordance with the South Dakota Codified Laws.
Section 8.7 Section Headings. The section headings contained in this
Agreement are for reference purposes only and shall not affect the meaning or
interpretation of this Agreement.
Section 8.8 Entire Agreement. This Agreement, together with the
Agreement of Merger and the Registration Rights Agreement, constitutes the
entire agreement and understanding among the parties hereto with respect to the
subject matter hereof and thereof and supersedes any and all prior agreements
and understandings, written or oral, relating to the subject matter hereof.
Section 8.9 Severability. Any term or provision of this Agreement which
is invalid or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such invalidity or unenforceability without
rendering invalid or unenforceable the remaining terms and provisions of this
Agreement or affecting the validity or enforceability of any of the terms or
provisions of this Agreement in any other jurisdictions, it being intended that
all rights and obligations of the parties hereunder shall be enforceable to the
fullest extent permitted by law.
Section 8.10 Counterparts. This Agreement may be signed in counterparts,
each of which when executed and delivered to each other party hereto, shall
constitute an original and which together shall constitute one and the same
agreement.
Section 8.11 Required Approvals. If approval of this Agreement or any of
the transactions contemplated hereby shall be required by any governmental or
supra-governmental
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agency or instrumentality or is considered to be necessary or advisable to all
the parties hereto, all parties hereto shall use their respective commercially
reasonable efforts to obtain such approval.
Section 8.12 Further Assurances. If at any time after the date hereof,
any further action is necessary or desirable to carry out the purposes of this
Agreement, each of the parties hereto shall take such further action as any
other party may reasonably request, including, without limitation, the addition
of a legend to certificates evidencing any Shares if deemed appropriate by
counsel to the Company.
Section 8.13 Public Disclosure. The Company shall not, and shall not
permit any of its Subsidiaries to, make any public announcements or disclosures
relating or referring to the New Shareholders, any of their Affiliates, or any
of their respective directors, officers, partners, employees or agents
(including, without limitation, any Person designated as a director of the
Company pursuant to the terms hereof) unless the New Shareholders have consented
to the form and substance thereof, which consent shall not be unreasonably
withheld except to the extent such disclosure is, in the opinion of counsel to
the Company, required by law or by stock exchange regulation, provided that (i)
any such required disclosure shall only be made, to the extent consistent with
the law, after consultation with the New Shareholders and (ii) no such
announcement or disclosure (except as required by law or by stock exchange
regulation) shall identify any such Person without the New Shareholders' prior
consent.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first above written.
THE COMPANY:
BLACK HILLS CORPORATION
a South Dakota corporation
By: /s/
---------------------------------------
Name:
-------------------------------------
Title:
-------------------------------------
NEW SHAREHOLDERS:
/s/
------------------------------------------
Xxxxxx X. Xxxxxxxx
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/s/
------------------------------------------
Xxxxxxxx X. Xxxxxxx
/s/
------------------------------------------
Xxxxxx Xxxxxxxx
/s/
------------------------------------------
Xxxxxxx X. Xxxxxxxx
/s/
------------------------------------------
Xxxxxx Xxxxxxx
/s/
------------------------------------------
Xxxx X. Xxxxxx, Xx.
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