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Exhibit 4.2
AMENDED AND RESTATED SHAREHOLDERS AGREEMENT
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THIS AMENDED AND RESTATED SHAREHOLDERS AGREEMENT is made as of the 16th
day of February, 1996, by and among Wastequip, Inc., an Ohio corporation (the
"Company"), and the individuals and entities listed on Schedule I to this
Agreement (collectively, the "Schedule I Shareholders").
W I T N E S S E T H:
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WHEREAS, the Company and certain of the Schedule I
Shareholders are parties to that certain Shareholders Agreement dated as of
August 4, 1989, as amended by the Amendment of Shareholders Agreement and
Partial Waiver of Rights of Refusal dated as of November 10, 1992, and as
further amended by Amendment No. 1 to the Shareholders Agreement dated as of May
26, 1994 (the "Prior Shareholders Agreement");
WHEREAS, the Schedule I Shareholders who are not parties to
the Prior Shareholders Agreement have agreed to purchase shares of capital stock
of the Company on the condition that they be made parties to an Amended and
Restated Shareholders Agreement in the form of this Agreement (hereinafter
referred to as the "Amended and Restated Shareholders Agreement" or "this
Agreement");
NOW, THEREFORE, in order to provide for stability in the
ownership and operation of the Company and to promote continuity in the
Company's management, the parties hereby agree as follows:
ARTICLE 1. DEFINITIONS
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"XXXXX GROUP" shall mean Arbeit & Co., the Xxxxxx Xxxxxxxxxx Family
Foundation, the Alpha & Omega Family Foundation, Xxxxxx Foundation, Inc. and
Xxxxxx Investment Co.
"AFFILIATE" shall mean, with respect to any person, any person who
controls, is controlled by, or is under common control with, such person;
PROVIDED, HOWEVER, that in the case of Xxxxxxxxxxxx II or Xxxxxxxxxxxx III, the
term Affiliate shall include any person who is controlled by one or more of the
persons who serve as general partners of either Xxxxxxxxxxxx Management Partners
II or Xxxxxxxxxxxx Management Partners III, and that in the case of Primus, the
term Affiliate, shall include any person which is controlled by one or more of
the persons who serve as general partners of Primus Venture Partners.
"BOCP" shall mean Banc One Capital Partners Corporation, a Texas
corporation.
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"BOCP COMBINED GROUP" shall mean the members of the BOCP Group and the
BOCPII Group.
"BOCP GROUP" shall mean BOCP and any person who acquires or otherwise
receives Common Shares, Preferred Shares or warrants to purchase Common Shares
from BOCP, so long as such person continues to own Common Shares, Preferred
Shares or warrants to purchase Common Shares.
"BOCPII" shall mean Banc One Capital Partners II, Limited Partnership,
a Delaware limited partnership.
"BOCPII GROUP" shall mean BOCPII and any person who acquires or
otherwise receives Common Shares, Preferred Shares or warrants to purchase
Common Shares from BOCPII, so long as such person continues to own Common
Shares, Preferred Shares or warrants to purchase Common Shares.
"COMMON SHARES" shall mean the Class A Common Shares, without par
value, and Class B Common Shares, without par value, of the Company.
"COMPANY" shall mean Wastequip, Inc. and its successors and assigns.
"FULLY DILUTED BASIS" shall mean, with respect to the computation of
the number of shares for any purpose, the number equal to the sum of all
outstanding shares plus all shares issuable upon exercise of any outstanding
options, warrants or convertible securities.
"INSTITUTIONAL SHAREHOLDERS" shall mean (i) the Xxxxxxxxxxxx Group,
(ii) the Primus Group, (iii) the BOCP Combined Group, (iv) the Mesirow Group and
(v) the Tampsco Group.
"MANAGEMENT SHAREHOLDERS" shall mean Xxxxxxx X. Xxxxxx, Xxxxxxx X.
Xxxxxx, Xxxxx X. XxXxxxxxx, Xx. and S. Xxxxxxxx XxXxxxxx, III, and any person
who acquires or otherwise receives Common Shares or Preferred Shares from any of
them, for so long as such person continues to own Common Shares or Preferred
Shares.
"MESIROW" shall mean Mesirow Capital Partners VI, an Illinois limited
partnership.
"MESIROW GROUP" shall mean Mesirow and any person which acquires or
otherwise receives Common Shares or Preferred Shares from Mesirow, so long as
such person continues to own Common Shares or Preferred Shares.
"XXXXXXXXXXXX II" shall mean Xxxxxxxxxxxx Venture Partners II, an Ohio
limited partnership, and its successors and assigns.
"XXXXXXXXXXXX III" shall mean Xxxxxxxxxxxx Venture Partners III, an
Ohio limited partnership, and its successors and assigns.
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"XXXXXXXXXXXX GROUP" shall mean Xxxxxxxxxxxx II and Xxxxxxxxxxxx III,
and any person which acquires or otherwise receives Common Shares or Preferred
Shares from Xxxxxxxxxxxx II or Xxxxxxxxxxxx III, so long as such person
continues to own Common Shares or Preferred Shares.
"PERSON" shall mean any individual or any partnership, corporation,
trust, estate, association or other entity.
"PERMITTED TRANSFEREES" shall mean (i) the Company, (ii) any equity
security holder of the Company, (iii) any Affiliate of any equity security
holder of the Company, (iv) in the case of any equity security holder of the
Company who is an individual, such person's spouse, or the ancestors or the
adoptive or natural descendants of the grandparents of such person or his
spouse, or (iv) any trust or other entity which is beneficially owned in its
entirety by any one or any combination of the persons described in clauses (i)
through (iv) above; provided, however, that no person or entity shall be a
Permitted Transferee unless, simultaneously with its acquisition of Common
Shares or Preferred Shares, it agrees to be bound by this Agreement by executing
a Shareholder's Assent in the form of Exhibit A attached hereto.
"PREFERRED SHARES" shall mean the Series A Convertible Preferred
Shares, without par value, of the Company.
"PRIMUS" shall mean Primus Capital Fund II Limited Partnership, an Ohio
limited partnership, and its successors and assigns.
"PRIMUS GROUP" shall mean Primus and any person which acquires or
otherwise receives Common Shares or Preferred Shares from Primus, so long as
such person continues to own Common Shares or Preferred Shares.
"SCHEDULE I SHAREHOLDERS" shall mean those persons identified on
Schedule I to this Agreement and their respective Affiliates and any person who
acquires Common Shares or Preferred Shares from any such person in accordance
with Article 3 of this Agreement.
"TAMPSCO" shall mean Tampsco Partnership VIII, a Missouri general
partnership, and its successors and assigns.
"TAMPSCO GROUP" shall mean Tampsco and Foundation Partners Fund, G.P.,
a Missouri general partnership, and any person which acquires or otherwise
receives Common Shares or Preferred Shares from Tampsco or Foundation Partners
Fund, G.P., so long as such person continues to own Common Shares or Preferred
Shares.
Other terms defined herein shall have the meanings assigned to them
herein.
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ARTICLE 2. GOVERNANCE
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2.1 COMPOSITION OF BOARD. (a) Each Schedule I Shareholder shall take
any and all action necessary (including, without limitation, voting all Common
Shares and Preferred Shares owned by such Schedule I Shareholder, executing and
delivering written shareholder actions, and calling special shareholder
meetings) to cause the Board of Directors of the Company (the "Board") to be
limited to ten members, and to include:
(i) an individual designated by the members of the
Xxxxxxxxxxxx Group in their sole discretion;
(ii) an individual designated by the members of the Primus
Group in their sole discretion;
(iii) an individual designated by the members of the
Tampsco Group in their sole discretion;
(iv) an individual designated by the members of the
Mesirow Group in their sole discretion;
(v) Xxxxxxx X. Xxxxxx, for so long as he is a shareholder
and the Chairman of the Company; and
(vi) Xxxxxx X. Xxxxxxxxx, for so long as he is the Chief
Executive Officer of the Company.
The individuals designated pursuant to clauses (i) and (ii) above shall
constitute the Directors who are elected by the holders of Class B Common Shares
pursuant to and in accordance with Subsection 1(i)(b) of Subdivision C of
Article IV of the Amended and Restated Articles of Incorporation of the Company.
The individuals designated pursuant to clauses (iii) and (iv) above shall
constitute the Directors who are elected by the holders of Preferred Shares
pursuant to and in accordance with Section 3 of Subdivision A of Article IV of
the Amended and Restated Articles of Incorporation of the Company. In addition,
the Board also shall include each of Xxxxxxx X. Xxxxxx, S. Xxxxxxxx XxXxxxxx,
III, and Xxxxx X. XxXxxxxxx, Xx., until such time as any such person shall cease
to be a shareholder of the Company or retire from or otherwise cease to be a
member of the Board. In the event that Xx. Xxxxxx, Xx. XxXxxxxx or Xx. XxXxxxxxx
shall cease to serve as a Director of the Company, for any reason, the remaining
Directors may designate an individual to serve for the remainder of such
person's term or until such time as the shareholders of the Company shall duly
elect an individual to replace him.
(b) Any Director who is elected to the Board pursuant to a
designation under any of clauses (i) - (iv) of subsection (a) above may be
removed from the Board by the group which designated such Director, and the
Schedule I Shareholders agree to call a special meeting of the shareholders or
to execute and deliver a written shareholder action upon the request of
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such group in order to effect such removal. In the event a Director who is
elected to the Board pursuant to a designation under any of clauses (i) - (iv)
of subsection (a) above resigns or is removed from, or otherwise ceases to serve
on, the Board, for whatever reason, the vacancy shall be filled with an
individual designated by the group which originally designated such Director.
2.2 QUORUM AND VOTING. A majority of the number of Directors then in
office, including at least one of the Directors designated under clauses (i) -
(iv) of Section 2.1 (a) above, shall be necessary to constitute a quorum for the
transaction of business by the Board. In all cases, except as otherwise
expressly required by statute or by the Articles of Incorporation of the
Company, as in effect from time to time, the approval or consent of a majority
of the number of Directors then in office shall be required in order to
authorize or approve actions or other matters presented to the Board.
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ARTICLE 3. RIGHTS OF FIRST REFUSAL AND CO-SALE
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3.1 RIGHTS OF FIRST REFUSAL.
(a) Subject to the provisions of Section 3.3, in the event any
Institutional Shareholder or any member of the Xxxxx Group (a "Selling
Shareholder") proposes to sell Common Shares or Preferred Shares, the
Selling Shareholder shall deliver written notice (the "First Refusal
Notice") with respect to such proposed sale to the other Institutional
Shareholders and to the members of the Xxxxx Group (collectively, the
"Offeree Shareholders") not later than 60 days prior to the closing of
such sale. The First Refusal Notice shall set forth the number of
Common Shares or Preferred Shares which the Selling Shareholder
proposes to sell (the "First Refusal Shares"), the identity of the
purchaser or purchasers, the terms of the proposed sale and the
proposed closing date for the proposed sale. Subject to the provisions
of Section 3.1(b) and (c) below, upon receipt of a First Refusal
Notice, each Offeree Shareholder shall have an option, exercisable at
any time within 20 days after the delivery of the First Refusal Notice,
to elect to purchase such portion of the First Refusal Shares as each
Offeree Shareholder shall elect in a written notice delivered to the
Selling Shareholder within such 20-day period. The First Refusal Shares
to be purchased by any electing Offeree Shareholder shall be subject to
purchase at the price and upon the other terms contained in the First
Refusal Notice and the number of First Refusal Shares shall be subject
to reduction as set forth in Section 3.1(b) below.
(b) ALLOCATION OF SHARES. If within such 20 day period, the
Offeree Shareholders collectively give written notice to the Selling
Shareholder of a desire to purchase all, but not less than all, of the
First Refusal Shares, then a purchase and sale agreement shall be
deemed to have been entered into among the Offeree Shareholders
indicating a desire to purchase the First Refusal Shares, as
purchasers, and the Selling Shareholder, as seller, containing the
terms set forth in the First Refusal Notice. Notwithstanding the
provisions of the preceding sentence, if the notices from the Offeree
Shareholders indicate a desire to purchase, in the aggregate, more than
the number of the First Refusal Shares, then, unless the Offeree
Shareholders who elected to purchase the First Refusal Shares
unanimously agree among themselves as to a different allocation, each
purchasing Offeree Shareholder shall purchase that number of the First
Refusal Shares (up to the number indicated in such Offeree
Shareholder's written notice of exercise) which bears the same ratio to
the total number of First Refusal Shares as the number of Common Shares
owned by such Offeree Shareholder (calculated on a Fully Diluted Basis)
bears to the total number of Common Shares owned by all of the Offeree
Shareholders (calculated on a Fully Diluted Basis) who gave written
notice of exercise. The provisions of the preceding sentence will be
reapplied as necessary (excluding Offeree Shareholders who have been
allocated the number of First Refusal Shares they indicated their
desire to purchase in their written notice) until all of the First
Refusal Shares have been allocated among the Offeree Shareholders who
gave notice of a desire to purchase any of the First Refusal Shares. In
the event the Offeree Shareholders do not give notice to
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the Selling Shareholder of a desire to purchase all of the First
Refusal Shares within the 20 day notice period, then the Selling
Shareholder shall give written notice to the Offeree Shareholders who
gave notice of a desire to purchase at least some of the First Refusal
Shares that additional First Refusal Shares are available for purchase
and such Offeree Shareholders shall then have an option, exercisable at
any time within 10 days after the delivery of such notice, to elect to
purchase the remainder of such First Refusal Shares. In the event such
participating Offeree Shareholders indicate a desire to purchase in the
aggregate more than the number of remaining First Refusal Shares, then
the remaining First Refusal Shares shall be allocated among them in
accordance with the allocation provisions set forth above.
Notwithstanding any of the foregoing, the rights of first refusal of
the Offeree Shareholders may be exercised only if the Offeree
Shareholders exercise their option to purchase all of the First Refusal
Shares. If the Offeree Shareholders fail to exercise the right to
purchase all of the First Refusal Shares, the Selling Shareholder shall
thereafter be free to sell the First Refusal Shares, at the price and
upon the terms indicated in the First Refusal Notice, at any time
within 180 days after the expiration of the time periods described
above, subject only to compliance with the Co-sale provisions of
Section 3.2.
(c) TERMS OF PURCHASE AND SALE. In the event the Offeree
Shareholders elect to purchase all of the First Refusal Shares, then at
the consummation of such purchase and sale (which the parties shall use
their best efforts to consummate not later than 30 days after the
giving of notice by the Offeree Shareholders of a desire to purchase
all of the First Refusal Shares), then the Selling Shareholder and the
participating Offeree Shareholders shall enter into a written agreement
providing for the purchase and sale of the First Refusal Shares. The
purchase agreement shall provide for (i) the purchase price and other
terms set forth in the First Refusal Notice, (ii) representations and
warranties of the Selling Shareholder as to its good and marketable
title to the First Refusal Shares and its absolute right to transfer
the First Refusal Shares to the participating Offeree Shareholders, and
(iii) the delivery to the participating Offeree Shareholders, against
receipt of the purchase price or other consideration, of the
certificates representing the First Refusal Shares which are being
transferred, duly endorsed in blank by the Selling Shareholder or with
blank stock powers attached thereto.
3.2 CO-SALE RIGHTS. In the event that any Schedule I Shareholder (a
"Selling Schedule I Shareholder") proposes to sell Common Shares or Preferred
Shares (other than to a Permitted Transferee or in connection with the exercise
of the rights of first refusal contained in Section 3.1 above), the Selling
Schedule I Shareholder shall deliver written notice (the "Co-Sale Notice") with
respect to such proposed sale to the other Schedule I Shareholders (collectively
the "Offeree Schedule I Shareholders") not later than 30 days prior to the
closing of such sale. Such Co-Sale Notice shall set forth the number of Common
Shares which the Selling Schedule I Shareholder proposes to sell or, in the
event that the Selling Schedule I Shareholder proposes to sell Preferred Shares,
the number of Common Shares issuable upon conversion of the Preferred Shares to
be sold (in each such case the "Co-Sale Shares"), the identity of the purchaser
or purchasers, the terms of the proposed sale, and the proposed closing date for
the proposed sale. Upon receipt of a Co-Sale Notice, each Offeree Schedule I
Shareholder shall have an option,
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exercisable at any time within 20 days after the delivery of the Co-Sale Notice,
to elect to participate in such sale and to sell to the proposed purchaser(s) up
to that number of the Co-Sale Shares multiplied by a fraction, (x) the numerator
of which shall be the total number of Common Shares held by the Offeree Schedule
I Shareholder or issuable to the Offeree Schedule I Shareholder upon the
conversion of any Preferred Shares held by him or upon the exercise in full of
any vested warrants or vested stock options held by him, and (y) the denominator
of which shall be the aggregate number of Common Shares owned by all of the
Schedule I Shareholders or issuable to the Schedule I Shareholders upon the
conversion of any Preferred Shares held by them or upon the exercise in full of
any vested warrants or vested stock options held by them, for the price and upon
the other terms and conditions set forth in the Co-Sale Notice. If an Offeree
Schedule I Shareholder elects to participate in a proposed sale, such
Shareholder must, as a condition to such participation first convert any
Preferred Shares or exercise any warrants or options held by such Offeree
Schedule I Shareholder, to the extent necessary to allow the sale of Common
Shares in the amount elected. If an Offeree Schedule I Shareholder elects to
participate in a proposed sale, then (i) the Selling Schedule I Shareholder
shall be required to include in the sale of the Co-Sale Shares to the proposed
purchaser(s) those Common Shares which such Offeree Schedule I Shareholder has
elected to sell, (ii) the number of Common Shares or Preferred Shares which the
Selling Schedule I Shareholder originally proposed to sell shall be reduced by
the number of Common Shares which the Offeree Schedule I Shareholder has elected
to sell (or the number of Preferred Shares, which, upon conversion, would equate
to such number of Common Shares) and (iii) such Selling Schedule I Shareholder
shall not consummate the sale of all or any portion of the Co-Sale Shares to the
proposed purchaser(s) without so including such Offeree Schedule I Shareholders'
Common Shares. Failure by any Offeree Schedule I Shareholder to give notice of
its election to participate in the proposed sale within the aforementioned 20
day period shall be deemed a forfeiture and waiver of any right of such Offeree
Schedule I Shareholder to participate in such sale, provided that such sale is
fully closed and consummated on or before the closing date, and upon the terms
and conditions specified in, the Co-Sale Notice. In the event such sale is not
so consummated, then the provisions of this Section 3.2 shall again be
applicable to the sale of the Co-Sale Shares.
3.3 LIMITED APPLICABILITY OF ARTICLE 3. The provisions of this Article
3 shall not apply to (i) any sale of Common Shares in connection with an initial
public offering of Common Shares (a "Public Offering") pursuant to a
registration statement under the Securities Act of 1933, as amended (the
"Securities Act"), or (ii) any sale by a Schedule I Shareholder to any of its
Permitted Transferees.
ARTICLE 4. COVENANTS
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The Company and each of the Management Shareholders agrees with the
Schedule I Shareholders that:
4.1 FINANCIAL INFORMATION, ETC. Until such time as the Schedule I
Shareholders cease to own, in the aggregate, ten percent of the Common Shares
calculated on a Fully Diluted Basis,
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the Company shall furnish to each Schedule I Shareholder copies of the following
financial statements, reports and information:
(a) (i) As soon as available and in any event within 90 days
after the end of each fiscal year of the Company, a copy of its annual
consolidated audited report, including balance sheet and related
statements of income, cash flows and stockholders' equity of the
Company and its consolidated subsidiaries for such fiscal year, with
comparative figures for the preceding fiscal year, prepared in
accordance with generally accepted accounting principles, certified by
Ernst & Young or another public accounting firm of nationally
recognized standing ("independent public accountants") as presenting
fairly, in all material respects, the consolidated financial position
of the Company and its subsidiaries as at the end of such fiscal year
and the consolidated results of their operations and cash flows for
such fiscal year in conformity with generally accepted accounting
principles, together with consolidating statements, the management
letter, if any, delivered to the Company by such independent public
accountants and the Company's response thereto; and (ii) as soon as
available and in any event within 30 days after the end of each month
of each fiscal year of the Company, a copy of the consolidated
unaudited financial statements of the Company and its subsidiaries,
consisting of a consolidated balance sheet as of the close of such
month and related statements of income and cash flows for such month
and from the beginning of such fiscal year to the end of such month
together with consolidating statements; and (iii) together with the
statements described in Section 4.1(a)(ii), a certificate signed by the
chief financial officer or the treasurer of the Company stating that in
his opinion such unaudited financial statements fairly present the
consolidated financial position of the Company and its subsidiaries as
of the date stated therein and the consolidated results of their
operations and cash flows for the period covered, SUBJECT, HOWEVER, to
year end adjustments which, in the aggregate, are not reasonably
expected to be material, and further subject to the omission of
footnotes.
(b) Promptly after the sending or filing thereof, copies of
all material reports or material correspondence that the Company or any
of its subsidiaries sends to any of its security holders, independent
public accountants, underwriters or financial advisors.
(c) On or before the 30th day after the commencement of each
fiscal year of the Company, an annual plan for the Company and each of
its subsidiaries for such fiscal year (an "Annual Plan"), which Annual
Plan shall include quarterly capital and operating expense budgets,
cash flow statements, pro forma balance sheets, capital expenditure
budgets, and profit and loss projections. The Company shall deliver
quarterly updates to each Annual Plan within 30 days after the end of
each fiscal quarter, which updates shall compare the Company's actual
operating performance to the budgeted figures in the Annual Plan and
shall contain a narrative explaining any material discrepancies between
the Company's actual performance and the Annual Plan and describing any
significant events affecting the Company which occurred during such
quarter.
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(d) Such other information with respect to the financial
condition and operations of the Company and its subsidiaries as the
Schedule I Shareholders may reasonably request and the Company can
obtain without unreasonable expense.
4.2 INSPECTION. The Company shall permit each of the Schedule I
Shareholders and any of their respective partners, directors, officers and
employees, and any representatives or agents designated by them and reasonably
satisfactory to the Company, to visit and inspect any of the assets and
properties of the Company or its subsidiaries, including, without limitation,
their books and records (and to make extracts therefrom) and to discuss the
Company's and its subsidiaries' affairs, finances and accounts with their
respective partners, directors, officers, employees, representatives and agents
(including independent public accounts and lawyers), all to such reasonable
extent and at such reasonable times and intervals as the Institutional
Shareholders may request.
4.3 NOTICES. The Company, as soon as practicable but in no event later
than five business days after the Company obtains knowledge thereof, shall give
notice to the Schedule I Shareholders of:
(a) any significant adverse development which occurs in any
litigation, arbitration or governmental investigation or proceeding
previously disclosed by the Company which, if determined adversely to
the Company or any of its subsidiaries, could have a material adverse
effect on the Company's assets, business operations, financial
condition or prospects;
(b) the commencement or threatened commencement of any suit,
legal or equitable, or of any administrative, arbitration or other
proceeding against the Company or any of its subsidiaries or their
respective businesses, assets or properties which, if determined
adversely to the Company or any of its subsidiaries, could have a
material adverse effect on the Company's assets, business operations,
financial condition or prospects;
(c) any other condition or event which may have a materially
adverse effect on the Company's assets, business operations, financial
condition or prospects.
4.4 TRANSACTIONS WITH AFFILIATES. The Company shall not, and shall not
permit any of its subsidiaries to: (a) permit the direct or indirect transfer,
distribution or payment of any of its funds, assets or property to any
shareholder, officer, Director or employee of the Company or any subsidiary or
any Affiliate or relative of any of the foregoing persons (collectively,
"Company Insiders") without the prior written consent of at least four of the
Institutional Shareholders, except that the Company or any subsidiary may pay:
(i) bona fide employee compensation to employees (whether in the form of cash,
stock options or otherwise) for services actually rendered to the Company or any
subsidiary, (ii) expenses incurred by an employee in the ordinary course of the
Company's or any subsidiary's business, (iii) amounts due or becoming due under
arrangements existing as of the date of this Agreement for services or property
or the use thereof allocated to the Company or any subsidiary, (iv) compensation
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to Xxxxxxx X. Xxxxxx, Xxxxxx X. Xxxxxxxxx or Xxxxxxx X. Xxxxxx under their
respective employment agreements with the Company which were entered into prior
to the date hereof, and (v) reasonable fees and expense reimbursements paid to
the Directors of the Company and its subsidiaries; (b) lend or advance money,
credit or property to any Company Insider except as permitted by the preceding
clause (a); (c) invest in (by capital contribution or otherwise) or purchase or
repurchase any stock or indebtedness, or any assets or properties, of any
Company Insider; or (d) guarantee, assume, endorse or otherwise become
responsible for, or enter into any agreement or instrument for the purpose of
discharging or assuming (either directly or indirectly, through the purchase of
goods, supplies or services or otherwise) any indebtedness, responsibility,
obligation or liability of any Company Insider.
4.5 REGULATORY COOPERATION. In the event that a member of the BOCP
Combined Group is deemed to own, control or have power over a greater quantity
of securities of any kind issued by the Company than is permitted by any
requirement of any applicable law (a "Regulatory Problem"), upon the written
request of any such person, the Schedule I Shareholders agree to vote all Common
Shares or Preferred Shares owned by them, to execute and deliver written
shareholder actions and to call special shareholder meetings, so as to eliminate
such Regulatory Problem as quickly as possible by taking steps necessary to
authorize a new class of capital stock of the Company having lesser or no voting
power but otherwise equivalent to the Common Shares, and to issue to such person
shares of such new class of capital stock in substitution for the Common Shares
which such person owns or to which such person is entitled, upon the exercise of
any warrant, to purchase. Notwithstanding any other provisions hereof, BOCP II
agrees that it will not exercise its voting rights with respect to any Class A
Common Shares issued to it upon exercise of any warrants owned by it as of the
date of this Agreement or hereafter acquired by it.
ARTICLE 5. REGISTRATION RIGHTS
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5.1 REQUIRED REGISTRATION. Upon the receipt by the Company of a written
request for the registration of Common Shares from a Schedule I Shareholder who
individually or together with other holders of securities of the Company
executing such request holds securities of the Company representing not less
than 40% of the Company's then outstanding Common Shares considered on a Fully
Diluted Basis, the Company shall promptly prepare and file, at its expense, a
registration statement under the Securities Act covering the Common Shares which
are the subject of such request and shall use its best efforts to cause such
registration statement to become effective; PROVIDED, HOWEVER, that the Company
shall only be required to register Common Shares (as opposed to Preferred Shares
or any other securities of the Company); PROVIDED FURTHER, that the Company
shall not be required to bear the expense of more than one such registration. In
the event that the Schedule I Shareholder who has requested the registration of
Common Shares pursuant to this Section 5.1 determines for any reason not to
proceed with a registration at any time before the registration statement has
been declared effective by the Securities and Exchange Commission (the
"Commission"), and such registration statement, if theretofore filed with the
Commission, is withdrawn with respect to the Common Shares covered
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thereby, and the Schedule I Shareholder agrees to bear its own expenses incurred
in connection therewith and to reimburse the Company for the expenses incurred
by it attributable to the registration of such Common Shares, then such Schedule
I Shareholder shall not be deemed to have exercised its right to require the
Company to register Common Shares pursuant to this Section 5.1 at the expense of
the Company.
5.2 INCIDENTAL REGISTRATION. Each time the Company shall determine to
proceed with the actual preparation and filing of a registration statement under
the Securities Act in connection with the proposed offer and sale of any of its
securities by it or any of its security holders (other than on Form S-4 or Form
S-8, or any successor or similar forms) including, without limitation, as a
result of a request by a Schedule I Shareholder pursuant to Section 5.1, the
Company will give written notice of its determination to all of the holders of
securities of the Company which are issued and outstanding as of the date hereof
(including, without limitation, all of the Schedule I Shareholders). Upon the
written request of any such holder given to the Company within 20 days after the
mailing of any such notice by the Company, the Company will, except as herein
provided, cause all of the Common Shares which such holders have requested to be
registered to be included in such registration statement, subject to the
reasonable request of any underwriters selected by the Company in connection
with the sale by the Company of any of its securities that all or any portion of
such Common Shares be excluded from such registration statement, pro rata among
the holders thereof. For purposes of calculating the pro rata rights of the
Company's security holders, (i) the holders of Preferred Shares shall be deemed
to hold the number of Common Shares such holders would own upon the conversion
of such Preferred Shares into Common Shares and (ii) the holders of warrants and
stock options shall be deemed to hold the number of Common Shares for which such
warrants and stock options are then exercisable, in each case determined as of
the effective date of the registration statement.
5.3 LIMITATIONS. Notwithstanding the provisions of Section 5.1, the
Company shall not be required to prepare and file any registration statement
upon the demand of any Schedule I Shareholder under Section 5.1: (a) if, in the
opinion of recognized securities counsel to the Company, Rule 144 under the
Securities Act is available to such holder or holders for the purpose of
selling, within a three-month period, the number of Common Shares requested to
be registered; or (b) within nine months after the effective date of a
registration statement filed by the Company pursuant to the request of a
Schedule I Shareholder under Section 5.1.
5.4 REGISTRATION PROCEDURES. If and whenever the Company is required by
the provisions of Section 5.1 or 5.2 to effect the registration of Common Shares
under the Securities Act, the Company will:
(a) Promptly prepare and file with the Commission a
registration statement with respect to such securities, and use its
best efforts to cause such registration statement to become and remain
effective for such period of time as may be reasonably necessary to
effect the sale of such securities.
(b) Prepare and file with the Commission such amendments to
such registration statement and supplements to the prospectus contained
therein as may be
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necessary to keep such registration statement effective for such period
of time as may be reasonably necessary to effect the sale of such
securities.
(c) Use its best efforts to register or qualify the Common
Shares for sale under such other securities or blue sky laws of such
jurisdictions as the holders of securities of the Company (hereinafter
in this section referred to as "such holders") participating in such
registration may reasonably request and do any and all other acts and
things which may be reasonably necessary or desirable to enable such
holders to consummate the disposition in such jurisdictions of the
Common Shares owned by such holders.
(d) Furnish to such holders participating in the registration
and to the underwriters of the securities being registered a reasonable
number of copies of the registration statement, preliminary prospectus,
final prospectus, and such other documents as such holders or
underwriters may reasonably request in order to facilitate the public
offering of such securities.
(e) Notify such holders participating in such registration,
promptly after it shall receive notice thereof, of the time when such
registration statement has become effective or a supplement to any
prospectus forming a part of such registration statement has been
filed.
(f) Notify such holders promptly of any request by the
Commission for the amending or supplementing of such registration
statement or prospectus or for additional information.
(g) Prepare and file with the Commission, promptly upon the
request of any such holders, any amendment or supplement to such
registration statement or prospectus which, in the opinion of special
counsel for such holders (and concurred in by counsel for the Company),
is required under the Securities Act or the rules and regulations
promulgated thereunder in connection with the distribution of Common
Shares by such holders.
(h) Prepare and promptly file with the Commission and promptly
notify such holders of the filing of any amendment or supplement to
such registration statement or prospectus as may be necessary to
correct any statements or omissions if, at the time when a prospectus
relating to such securities is required to be delivered under the
Securities Act, any event shall have occurred as the result of which
any such prospectus or any other prospectus as then in effect would
include an untrue statement of a material fact or omit to state any
material fact necessary to make the statements therein, in light of the
circumstances in which they were made, not misleading.
(i) Advise such holders, promptly after it shall receive
notice or obtain knowledge thereof, of the issuance of any stop order
by the Commission suspending the effectiveness of such registration
statement or the initiation or threat of initiation of any
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proceeding for such purpose and promptly use its best efforts to
prevent the issuance of any stop order or to obtain its withdrawal if
such stop order should be issued.
(j) As soon as practicable and in no event less than one day
prior to the filing of any amendment or supplement to such registration
statement or prospectus, furnish copies thereof to such holders and
refrain from filing any such amendment or supplement to which a
majority in interest of such holders shall have reasonably objected on
the grounds that such amendment or supplement does not comply in all
material respects with the requirements of the Securities Act or the
rules and regulations thereunder, unless in the opinion of counsel for
the Company the filing of such amendment or supplement is reasonably
necessary to protect the Company from any liabilities under any
applicable federal or state law and such filing will not violate
applicable law.
(k) At the request of a Schedule I Shareholder, furnish on the
date or dates provided for in the underwriting agreement: (i) an
opinion of counsel satisfactory to such Schedule I Shareholder,
addressed to the underwriters, if any, and to the Schedule I
Shareholder making such request, opining as to such matters as such
underwriters and holder or holders may reasonably request; and (ii) a
letter or letters from the independent certified public accountants of
the Company, addressed to the underwriter, if any, and to the Schedule
I Shareholder making such request, covering such matters as such
underwriters and Schedule I Shareholder may reasonably request, in
which letters such accountants shall state (without limiting the
generality of the foregoing) that they are independent certified public
accountants within the meaning of the Securities Act and that in the
opinion of such accountants the financial statements and other
financial data of the Company included in the registration statement or
any amendment or supplement thereto comply in all material respects
with the applicable accounting requirements of the Securities Act;
PROVIDED, HOWEVER, that in the event the Company receives a request for
such an opinion or letter from more than one Schedule I Shareholder, an
opinion or letter, as the case may be, addressed to all of the Schedule
I Shareholders making such request shall satisfy the Company's
obligations under this paragraph (k).
5.5 EXPENSES. With respect to the registrations requested pursuant to
Section 5.1 hereof which are to be at the expense of the Company and with
respect to each inclusion of Common Shares in a registration statement pursuant
to Section 5.2 hereof, the Company shall bear the following fees, costs and
expenses: all registration, filing and NASD fees, printing expenses,
underwriting discounts and commissions, transfer fees, fees and disbursements of
counsel and accountants for the Company, fees and disbursements of counsel, if
any, for the underwriter or underwriters of such securities related to any sale
of securities by the Company or any person other than the holders of securities
of the Company participating in such registration (but only if the Company
and/or the selling security holders are required to bear such fees and
disbursements), and all legal fees and disbursements and other expenses of
complying with state securities or blue sky laws of any jurisdictions in which
the securities to be offered are to be registered or qualified; and the holders
of securities of the Company participating in such registration shall bear the
fees, costs and expenses of their special counsel
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and of counsel for the underwriter or underwriters retained by them in
connection with the sale of their securities, if not paid by such underwriter or
underwriters.
5.6 INDEMNIFICATION.
(a) BY THE COMPANY. The Company will indemnify and hold
harmless each holder of Common Shares which are included in a registration
statement pursuant to these provisions and any underwriter (as defined in the
Securities Act) for such holder and each person, if any, who controls such
holder or such underwriter within the meaning of the Securities Act, from and
against any and all loss, damage, liability, cost and expense to which such
holder or any such underwriter or controlling person may become subject under
the Securities Act or otherwise, insofar as such losses, damages, liabilities,
costs or expenses are caused by any untrue statement or alleged untrue statement
of any material fact contained in such registration statement, any prospectus
contained therein or any amendment or supplement thereto, or arise out of or are
based upon the omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein, in
light of the circumstances in which they were made, not misleading; PROVIDED,
HOWEVER, that the Company will not be liable in any such case to the extent that
any such loss, damage, liability, cost or expense arises out of or is based upon
an untrue statement or alleged untrue statement or omission or alleged omission
so made in conformity with information furnished by such holder, such
underwriter or such controlling person in writing specifically for use in the
preparation thereof.
(b) BY HOLDERS OF REGISTRABLE SHARES. Each holder of Common
Shares which are included in a registration pursuant to these provisions will
indemnify and hold harmless the Company, each other holder, any underwriter and
each person, if any, who controls the Company, such other holder or such
underwriter, from and against any and all loss, damage, liability, cost or
expense to which the Company or such other holder or any controlling person
and/or any underwriter may become subject under the Securities Act or otherwise,
insofar as such losses, damages, liabilities, costs, or expenses are caused by
any untrue or alleged untrue statement of any material fact contained in such
registration statement, any prospectus contained therein, or any amendment or
supplement thereto, or arise out of or are based upon the omission or the
alleged omission to state therein a material fact required to be stated therein
or necessary to make the statements therein, in light of the circumstances in
which they were made, not misleading, in each case to the extent, but only to
the extent, that such untrue statement or alleged untrue statement or omission
or alleged omission was so made in reliance upon and in strict conformity with
written information furnished by such holder specifically for use in the
preparation thereof.
(c) NOTICE. Promptly after receipt by an indemnified party
pursuant to the provisions of paragraph (a) or (b) of this Section 5.6 of notice
of the commencement of any action involving the subject matter of the foregoing
indemnity provisions, such indemnified party will, if a claim thereof is to be
made against the indemnifying party pursuant to the provisions of said paragraph
(a) or (b), promptly notify the indemnifying party in writing of the
commencement thereof; but the omission to so notify the indemnifying party will
not relieve it
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from any liability which it may have to any indemnified party otherwise than
hereunder. In case any such action is brought against any indemnified party and
the indemnified party notifies the indemnifying party of the commencement
thereof, the indemnifying party shall have the right to participate in, and to
the extent that it may wish, jointly with any other indemnifying party similarly
notified, to assume the defense thereof, with counsel satisfactory to such
indemnified party; PROVIDED, HOWEVER, that if the defendants in any action
include both the indemnified party and the indemnifying party and there is a
conflict of interest which would prevent counsel for the indemnifying party from
also representing the indemnified party, the indemnified party or parties shall
have the right to select separate counsel to participate in the defense of such
action on behalf of such indemnified party or parties. After notice from the
indemnifying party to such indemnified party of its election so to assume the
defense thereof, the indemnifying party will not be liable to such indemnified
party pursuant to the provisions of said paragraph (a) or (b) for any legal or
other expense subsequently incurred by such indemnified party in connection with
the defense thereof other than reasonable costs of investigation, unless (i) the
indemnified party shall have employed counsel in accordance with the proviso of
the preceding sentence, (ii) the indemnifying party shall not have employed
counsel satisfactory to the indemnified party to represent the indemnified party
within a reasonable time after the notice of the commencement of the action, or
(iii) the indemnifying party has authorized the employment of counsel for the
indemnified party at the expense of the indemnifying party.
5.7 TRANSFER OF REGISTRATION RIGHTS. The registration rights and
related obligations provided herein may be transferred, in whole or in part, and
from time to time, to any person who acquires or otherwise receives Common
Shares or Preferred Shares, or warrants for Common Shares, from a Schedule I
Shareholder in accordance with Article 3 of this Agreement; PROVIDED, HOWEVER,
that (a) the Company shall be given written notice by the transferor thereof at
the time of such transfer stating the name and address of the transferee and
identifying the securities with regard to which such rights are being
transferred and (b) the transferee shall agree in writing to assume the
obligations of the transferor hereunder to the extent of such transfer.
5.8 RULE 144 REPORTING. With a view to making available the benefits of
certain rules and regulations of the Commission that may permit the sale of
restricted securities to the public without registration, the Company agrees
that, following the consummation of a Public Offering, it shall use its best
efforts to:
(a) make and keep public information regarding the Company
available (as such terms are understood and defined in Rule 144 under the
Securities Act);
(b) file with the Commission in a timely manner all reports
and other documents required to be filed by the Company under the Securities Act
or under the Securities Exchange Act of 1934, as amended (the "Exchange Act");
(c) so long as any Schedule I Shareholder owns any restricted
securities of the Company, furnish to such Schedule I Shareholder upon its
written request therefor a written
16
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statement by the Company as to its compliance with the reporting requirements of
the Securities Act (including, without limitation, Rule 144 thereunder) and the
Exchange Act; and
(d) take such further action as any Schedule I Shareholder may
reasonably request.
ARTICLE 6. GENERAL PROVISIONS
-----------------------------
6.1 LEGENDS. The following legend shall appear conspicuously on the
face or back of any certificate for Common Shares or Preferred Shares hereafter
issued by the Company to any of the Schedule I Shareholders or to any person who
acquires or otherwise receives Common Shares or Preferred Shares from any
Schedule I Shareholder:
The shares represented by this certificate are subject to the
terms and provisions of an Amended and Restated Shareholders
Agreement dated as of February ___, 1996, by and among the
Company and certain of the shareholders of the Company. Any
purchaser, assignee, transferee, pledgee or other successor to
any holder hereof is bound by the terms and provisions of such
instrument, a copy of which will be mailed to any holder
hereof, without charge, within five days after receipt of a
written request therefor directed to the Secretary of the
Company.
6.2 AMENDMENT; TERMINATION. This Agreement may be amended only in a
writing which refers to this Agreement and which is executed by each of the
Institutional Shareholders, by at least one member of the Xxxxx Group, and by
such other Schedule I Shareholders, if any, as may be necessary so that the
amendment has been executed by the holders of not less than 80% of the Common
Shares then held directly or indirectly by all of the Schedule I Shareholders
calculated on a Fully Diluted Basis; provided, however, that no amendment hereto
shall materially diminish the rights of any Schedule I Shareholder hereunder
unless such Schedule I Shareholder agrees in writing to such amendment. All of
the provisions of this Agreement other than those contained in Article 5 shall
terminate upon the completion of a Public Offering (as such term defined in
Section 3.3).
6.3 EFFECT OF AGREEMENT. This Agreement shall be binding upon and shall
inure to the benefit of the Company, its successors and assigns, and shall be
binding upon and inure to the benefit of the other parties hereto and any person
who acquires or otherwise receives Common Shares, Preferred Shares or warrants
for Common Shares from a party hereto in accordance with Article 3 of this
Agreement. No party to this Agreement may assign any of his rights or delegate
any of his duties under this Agreement except by a transfer of his Common
Shares, Preferred Shares or warrants for Common Shares which complies in all
respects with Article 3 of this Agreement.
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6.4 COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which shall
constitute the same Agreement.
6.5 NOTICES. All notices, elections and other communications pursuant
to this Agreement shall be deemed to be delivered when received and shall be
made in writing and sent to (a) the Company at its principal business address or
(b) to any Schedule I Shareholder at his address as shown on the books and
records of the Company.
6.6 ENTIRE AGREEMENT. Except as herein expressly set forth or in an
instrument in writing signed by the party to be bound thereby which makes
reference to this Agreement, this Agreement embodies the entire agreement
relating to the subject matter hereof, and no other representations, warranties,
covenants, understandings or agreements relating to such subject matter exist
between any of the parties.
6.7 GOVERNING LAW. This Agreement has been negotiated, executed and
delivered in the State of Ohio, and shall in all respects be interpreted,
construed and governed by and in accordance with the internal substantive law of
the State of Ohio.
6.8 SEVERABILITY. Each section, subsection and lesser section of this
Agreement constitutes a separate and distinct undertaking, covenant and/or
provision hereof. In the event that any provision of this Agreement shall
finally be determined to be unlawful, all such provisions shall be deemed
severed from this Agreement, but every other provision of this Agreement shall
remain in full force and effect, and in substitution for any such provision held
unlawful, there shall be substituted a provision of similar import reflecting
the original intent of the parties hereto to the extent permissible under law.
6.9 CONSTRUCTION. The headings of the Articles and Sections of this
Agreement are inserted for convenience only and shall not be deemed to
constitute a part hereof. Unless otherwise specifically indicated, references in
this Agreement to Articles, Sections, paragraphs and clauses refer to the
Articles, Sections, paragraphs and clauses of this Agreement. All personal
pronouns used in this Agreement, whether used in the masculine, feminine or
neuter gender, shall include all other genders, and the singular shall include
the plural and vice versa.
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IN WITNESS WHEREOF, the Company and the Schedule I Shareholders have
executed this Agreement as of the day and year first above written.
WASTEQUIP, INC.
(the "Company")
By: /s/ Xxxxxxx X. Xxxxxx
----------------------------------------
Xxxxxxx X. Xxxxxx, Chairman
Schedule I Shareholders:
------------------------
PRIMUS CAPITAL FUND II LIMITED PARTNERSHIP
By Primus Management II
By Primus Venture Partners
By: /s/ Xxxxx X. Xxxxxxxx
----------------------------------------
Xxxxx X. Xxxxxxxx, Partner
XXXXXXXXXXXX VENTURE PARTNERS II
By Xxxxxxxxxxxx Management Partners II
By: /s/ Xxxx X. Xxxxxxxxxxx
----------------------------------------
Xxxx X. Xxxxxxxxxxx, Partner
XXXXXXXXXXXX VENTURE PARTNERS III
By Xxxxxxxxxxxx Management Partners III
By: /s/ Xxxx X. Xxxxxxxxxxx
----------------------------------------
Xxxx X. Xxxxxxxxxxx, Partner
/s/ Xxxxxxx X. Xxxxxx
----------------------------------------
Xxxxxxx X. Xxxxxx
/s/ Xxxxxxx X. Xxxxxx
----------------------------------------
Xxxxxxx X. Xxxxxx
/s/ S. Xxxxxxxx Xxxxxxxx, III
----------------------------------------
S. Xxxxxxxx XxXxxxxx, III
/s/ X. X. XxXxxxxxx, Xx.
----------------------------------------
X. X. XxXxxxxxx, Xx.
/s/ A. Xxxxxxx Xxxxx, III
----------------------------------------
A. Xxxxxxx Xxxxx, III
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ADDITIONAL SIGNATURE PAGE TO AMENDED AND
RESTATED SHAREHOLDERS AGREEMENT
BANC ONE CAPITAL PARTNERS II,
LIMITED PARTNERSHIP
By BOCP Holdings Corporation
By: /s/ Xxxxxxx X. Xxxxx
-------------------------------------
Title:
-------------------------------------
BANC ONE CAPITAL PARTNERS CORPORATION
By: /s/ Xxxxxxx X. Xxxxx
-------------------------------------
Title:
-------------------------------------
TAMPSCO PARTNERSHIP VIII,
a Missouri General Partnership
By: /s/ M. Xxxxx Xxxxxxx
-------------------------------------
M. Xxxxx Xxxxxxx
General Partner
FOUNDATION PARTNERS FUND, G.P.,
a Missouri General Partnership
By: /s/ M. Xxxxx Xxxxxxx
-------------------------------------
M. Xxxxx Xxxxxxx
General Partner
20
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ADDITIONAL SIGNATURE PAGE TO AMENDED AND
RESTATED SHAREHOLDERS AGREEMENT
MESIROW CAPITAL PARTNERS VI
By: Mesirow Private Equity Investments, Inc.,
its general partner
By: /s/ Xxxxxx X. Xxxxxx
-----------------------------------
Title: Executive Vice President
ARBEIT & CO.
By: /s/ Xxxx X. Xxxx
-----------------------------------
Title: Attorney-in-fact
-----------------------------------
XXXXXX XXXXXXXXXX FAMILY FOUNDATION
By: /s/ Xxxx X. Xxxx
-----------------------------------
Title: Vice President
-----------------------------------
ALPHA & OMEGA FAMILY FOUNDATION
By: /s/ Xxxx X. Xxxx
-----------------------------------
Title: Vice President
-----------------------------------
XXXXXX FOUNDATION, INC.
By: /s/ Xxxx X. Xxxx
-----------------------------------
Title: Vice President
-----------------------------------
XXXXXX INVESTMENT CO.
By: /s/ Xxxx X. Xxxx
-----------------------------------
Title: Managing Partner
-----------------------------------
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ADDITIONAL SIGNATURE PAGE TO AMENDED AND
RESTATED SHAREHOLDERS AGREEMENT
WILBLAIRCO ASSOCIATES, a general partnership
By: /s/ Xxxxxxx Xxxxxxxx
-------------------------------
Title: Partner
-------------------------------
/s/ Xxx X. Xxxxxx
---------------------------------------
Xxx X. Xxxxxx
00
00
SCHEDULE I
----------
SCHEDULE I SHAREHOLDERS
-----------------------
Primus Capital Fund II Limited Partnership
Xxxxxxxxxxxx Venture Partners II
Xxxxxxxxxxxx Venture Partners III
Xxxxxxx X. Xxxxxx
Xxxxxxx X. Xxxxxx
S. Xxxxxxxx XxXxxxxx, III
X. X. XxXxxxxxx, Xx.
A. Xxxxxxx Xxxxx, III
Banc One Capital Partners II, Limited Partnership
Banc One Capital Partners Corporation
Tampsco Partnership VIII
Foundation Partners Fund, X.X.
Xxxxxxx Capital Partners VI
Arbeit & Co.
Xxxxxx Xxxxxxxxxx Family Foundation
Alpha & Omega Family Foundation
Xxxxxx Foundation, Inc.
Xxxxxx Investment Co.
Wilblairco Associates, a general partnership
Xxx X. Xxxxxx
24
EXHIBIT A
---------
SHAREHOLDER'S ASSENT
--------------------
The undersigned hereby assents to the Amended and Restated
Shareholders Agreement by and among Wastequip, Inc., an Ohio corporation, and
certain of its shareholders dated as of February __, 1996 (the "Agreement"), and
hereby agrees to become a party to the Agreement and to be bound by all of the
terms and provisions thereof. For purposes of the Agreement, the undersigned
shall be deemed to be a "Schedule I Shareholder" as such term is defined in the
Agreement.
Executed as of ______________________.
------------------------------
Shareholder's Signature
Name and Address of Shareholder:
------------------------------
------------------------------
------------------------------
