Exhibit 10.59
[FORM OF] SHAREHOLDER AGREEMENT
THIS SHAREHOLDER AGREEMENT ("Agreement") is made as of the
30th day of July, 1997 by and among _______, ("Individual" or "Shareholder"),
and Noble International, Ltd., a Michigan corporation, with its principal
offices at 00 Xxxxxxxxxx Xxxxx Xxxx., Xxx. 000, Xxxxxxxxxx Xxxxx, XX 00000 (the
"Corporation").
WHEREAS, the Corporation is the sole and/or majority shareholder of
several companies engaged in, among other things, the automobile parts supply
business (the "Subsidiaries")(the Corporation and the Subsidiaries are
collectively referred to as the "Corporation");
WHEREAS, Shareholder is an officer, director or employee of the
Corporation;
WHEREAS, the Shareholder is the beneficial and/or actual owner of
certain shares of the Corporation (the "Shares" and/or "Stock") and has
previously entered into a form of shareholder agreement with the Corporation;
WHEREAS, the Corporation is undertaking an initial public offering of
its stock ("IPO"). In conjunction with the IPO the number of Shares currently
owned by Shareholder will be split at an approximate rate of 320:1 (the "IPO
Split");
WHEREAS, the Shareholder and the Corporation wish to amend the prior
shareholder agreement and have concluded after due deliberation that it is in
their mutual interest to require certain restrictions on the sale or transfer of
Shares as well as the purchase price of such Shares in the event that
Shareholder leaves the employment of the Corporation and thereby wish to amend
all previous shareholder agreements.
NOW THEREFORE, in consideration of the mutual promises contained in
this Agreement and other valuable consideration, the receipt of which is
acknowledged, the parties to this Agreement agree as follows:
Article I
SHARE TRANSFER RESTRICTION
1. Prohibition Against Transfers. The Shareholder shall not sell,
assign, transfer, give, donate, pledge, deposit, alien, or
otherwise encumber or dispose of any share of the Stock now or
hereafter held by him, except as permitted by this Agreement
and in accordance with its terms. The Corporation shall not
cause or permit the transfer of any share of the Stock to be
made on its books unless the transfer is permitted by this
Agreement, and has been made in accordance with its terms.
2. Exempted Transfers. The prohibition in Paragraph 1.01 shall
not apply to a transfer of an interest in the shares of the
Corporation (a) to a self-trusteed revocable living trust, all
of whose beneficiaries are members of the Shareholder's
immediate family. The trustee of the revocable trust shall
receive and hold such shares of the Stock
subject to the terms of this Agreement and the obligations
hereunder of the Shareholder, and (b) that has been approved
in writing by all of Member's of the Corporation's Board of
Directors having general voting rights.
Article II
BUY-OUT RIGHTS
1. Events Triggering a Buy-Out Right. The following events shall
trigger the Corporation's Buy-Out right.
A. Termination of Employment. If Shareholder who is
employed by the Corporation or any of its
Subsidiaries, on a part-time or full-time basis, or
as an officer, director, or consultant ceases to be
employed by the Corporation for any reason other than
death, whether the termination results from
retirement because of age under a retirement policy
adopted by the Corporation that applies to the
Shareholder, voluntary termination of employment,
termination of employment by the mutual consent of
the Shareholder and the Corporation, or termination
by the unilateral act of the Corporation with or
without cause pursuant to the Corporation's at-will
employment policy, then the Corporation shall have an
option to purchase, or cause to be purchased, in
accordance with the procedures set forth in Article
III, all (but not less than all) of the terminated
Shareholder's Shares at the price and on the other
terms set forth below.
B. Death. In the event that a Shareholder who is
employed by the Corporation shall die the Corporation
shall have an option to purchase, or cause to be
purchased, in accordance with the procedures set
forth below, all (but not less than all) of the
Deceased Shareholder's shares at the price and on the
other terms set forth below.
C. Transfers by Operation of Law. In the event that any
Shareholder:
i. Files a voluntary petition under any
bankruptcy or insolvency law or a petition
for the appointment of a receiver, or makes
an assignment for the benefit of creditors;
ii. Is subjected involuntarily to such a
petition or assignment or to an attachment
of other legal or equitable interest with
respect to his shares in the Corporation
and such involuntary petition, assignment,
or attachment is not discharged within
thirty (30) days after its effective date;
or
iii. Is subjected to any other possible
involuntary transfer of his Shares in the
Corporation by legal process, including,
without limitation, an assignment or
transfer pursuant to a divorce decree, then
the
Corporation shall have an option to
purchase, or cause to be purchased, in
accordance with the procedures set forth in
Article III, all (but not less than all) of
the terminated Shareholder's shares at the
price and on the other terms set forth in
Article III.
2. Notification. Except as otherwise provided, whenever the
Corporation has an option to purchase, or cause to be
purchased, the shares of Shareholder pursuant to one or more
of the events triggering a buy-out, then within five (5) days
after the date the Corporation's Secretary receives written
notification that an event triggering a buy-out right has
occurred, the Corporation will call a special meeting of the
Board of Directors, to be held no more than ten (10) days
after the call, to decide whether the Corporation should
purchase all (but not less than all) the Shares owned by the
Shareholder whose shares are subject to the Buy-Out right. The
Corporation shall, within five (5) days of the meeting, notify
the Shareholder of its intention to acquire the Shares.
Article III
PURCHASE PRICE
1. Purchase Price and Terms. In the event that Corporation
exercises its option to acquire Shareholder's Shares pursuant
to Article II above, the purchase price for Shares shall be as
follows:
A. If the option is exercised between June 1, 1997 and
December 31, 1997, the purchase price shall be the
greater of $157 per share for each share of the
Corporation held by the Shareholder prior to the
effect of the IPO split or the book value per share
as identified in the Corporation's December 31, 1996
financial statement.
B. If the option is exercised between January 1, 1998
and December 31, 1998, the purchase price shall be
fifty percent (50%) of the equivalent book value per
share of the Corporation as of December 31, 1997 for
each Share of the Corporation held by the Shareholder
prior to the effect of the IPO Split.
C. If the option is exercised between January 1, 1999
and December 31, 1999, the purchase price shall be
seventy-five percent (75%) of the equivalent book
value per share of the Corporation as of December 31,
1998 for each Share of the Corporation held by the
Shareholder prior to the effect of the IPO Split.
D. For purposes of illustration only and not by way of
warranty, representation or guaranty, in the event
that the Corporation exercises its Option in 1999,
for a Shareholder who owns 20 Shares of the Company
prior to the IPO, with a IPO Split of 320:1, and a
book value equivalent per share of $1,148.94, the
Shareholder would receive a purchase price for his
Shares of $17,234.00.
Book Value Equivalent (($27,000,000(Noble 1998 book
value)/7,520,000(number of shares)*320)=$1,149/share
(pre-split)*20(pre-split shares)*0.75=$17,234.00
i. Book Value For purposes of paragraph 4(a),
"book value" shall be defined as the
Shareholder's equity of the Corporation as
determined by the Corporation's independent
accountant in accordance with the
Corporation's usual method of accounting.
ii. Closing The closing of any purchase of
Shares and the payment therefore shall be
held at a time and place to be agreed by the
parties, but in no event later than thirty
(30) days after the triggering event set
forth in Article II hereof.
iii. Certificates. At closing, the certificate(s)
representing the shares of the Stock being
sold shall be delivered by the Shareholder
to the Corporation, duly endorsed for
transfer, with the necessary documentary and
transfer tax stamps, if any, affixed by the
selling Shareholder along with a full and
final release of any and all claims that
Shareholder may have against the
Corporation.
Article IV
MISCELLANEOUS
1. Action by the Corporation. If the Corporation is unable to
make any purchase of Stock required under this Agreement due
to provisions of applicable statutes, its Articles of
Incorporation or Bylaws, the Corporation agrees to take such
action as may be necessary to permit the Corporation to make
such purchases, and the Shareholder agrees that they will also
take such action as may be necessary for the Corporation to
make such purchases.
2. Specific Performance. The parties agree that any violation of
this Agreement (other than a default in the payment of money)
cannot be compensated for by damages, and any aggrieved party
shall have the right, and is hereby granted the privilege, of
obtaining specific performance of this Agreement in any court
of competent jurisdiction in the event of any breach
hereunder.
3. Stock Certificates to be Marked with Legend. Each certificate
held by Shareholder representing shares of common stock of the
Corporation now or hereafter held by him shall be imprinted
with a legend in substantially the following form:
The sale, transfer or disposition of the shares of
stock represented by this certificate is restricted
under the
terms of a Shareholder Agreement a copy of which is
on file at the office of the Corporation.
Shareholder agrees to submit each certificate held by him to
the Corporation within a reasonable time after the execution
of this Agreement for the purpose of placing this legend
thereon.
4. Termination. This Agreement shall terminate upon the
occurrence of one or more of the following events, or as
otherwise provided by law:
A. dissolution, bankruptcy, or receivership of the
Corporation;
B. mutual consent of the parties;
C. Upon the transfer of all of the shares of the
Corporation in connection with a merger, acquisition,
consolidation, or share exchange except a merger,
acquisition, consolidation, or share exchange which
effects a mere change in form or domicile of the
Corporation without substantially changing respective
shareholdings of the Shareholders; or
D. January 1, 2000.
Upon termination the share certificates held by Shareholder
shall be surrendered to the Corporation, which shall issue new
certificates for the same number os shares but without the
endorsement required by paragraph 4.03.
5. Voting. The parties resolve and agree that all acts which may
be voted upon by the Shareholders or which require Shareholder
action may be undertaken by the Corporation, or its Directors
or officers upon the affirmative vote or consent of the
Shareholders owning a simple majority of the shares of Stock
of the Corporation.
6. Additional Matter
A. All terms of this Agreement shall inure to and be
binding upon the parties hereto, and their heirs,
personal representatives, successors, and assigns.
B. The parties hereto expressly acknowledge that this
Agreement constitutes the entire contract between the
parties concerning transfer restrictions and buy-out
rights of the Corporation's shares and that, unless
otherwise provided in this Agreement, any other
agreements or understandings, oral or written,
previous or contemporaneous of any nature with
respect to such matters are hereby superseded and
revoked and shall be of no further force and effect.
C. The parties acknowledge that legal counsel preparing
this Agreement was representing the Corporation
("General Counsel"), and that i) Shareholder has been
advised to seek independent counsel, ii) Shareholder
has had the opportunity to seek the advice of
independent counsel, and iii) Shareholder has
received no representations from General Counsel
about the tax consequences of this Agreement.
D. In the event that any provision of this Agreement is
declared by a court of competent jurisdiction to be
void or unenforceable, such provision shall be deemed
severed from the remainder of this Agreement, and the
balance of the Agreement shall remain in effect
giving full effect to the intent of the parties and
the meaning of this Agreement.
E. This Agreement shall be governed by and construed in
accordance with the laws of the State of Michigan
applicable to contracts made and fully performed
within such State, and the parties consent to the
jurisdiction of the Courts of record of Michigan for
all proceedings in connection with this Agreement.
F. Any notice which is permitted or required under this
Agreement shall be duly given if in writing and
either delivered personally or sent by registered or
certified mail, return receipt requested, postage
prepaid as follows:
If to the Corporation: Xxxxxxx X. Xxxx, Esq.
Noble International, Ltd.
00 Xxxxxxxxxx Xxxxx Xxxx.
Xxx, 000
Xxxxxxxxxx Xxxxx, XX 00000
If to a Shareholder: at the address on file in
the records of the
Corporation.
IN WITNESS WHEREOF, the Corporation has caused this Agreement to be
executed by its President, and the Shareholder has hereunto set his/her hand as
of the date and the year first above written.
____________________________
_______________, Shareholder
Noble International, Ltd.
By:_________________________
Its:________________________
