GORENSTEIN AGREEMENT
This Gorenstein Agreement (the "Agreement") is made this 20th day of
September, 1996 by and among Vita Food Products, Inc., a Nevada Corporation (the
"Company"), Xxxxxxx X. Xxxxx, Xxxxx X. Xxxxxxx, Xxx Xxxxxxxxxx, Xxxxx
Xxxxxxxxxx and J.B.F. Enterprises.
RECITALS:
A. The Company is endeavoring to raise capital for its business through
an initial public offering of the common stock of the Company (the "IPO").
B. National Securities Corporation ("National") is acting as the
managing underwriter for the IPO.
C. In connection with the IPO, National has requested and the
Company desires that the Settlement Agreement (as defined in paragraph 4 below)
entered into among the parties hereto, and certain other parties, be terminated
and that the Gorensteins (as defined in paragraph 3) waive any and all
dissenters' rights or appraisal rights in connection with the Reincorporation
Merger (as defined in paragraph 4). In return for the Gorensteins' agreement to
terminate the Settlement Agreement and waive any and all dissenters' rights or
appraisal rights, the Company, Xxxxxxx X. Xxxxx and Xxxxx X. Xxxxxxx will agree
to take the actions described in paragraphs 1, 2 and 3 below.
D. On September 20, 1996, the Company reincorporated in the State of
Nevada through a merger of Vita Food Products, Inc., an Illinois corporation
("Vita-Illinois"), and V-F Acquisition, Inc., an Illinois corporation that was
the largest shareholder of Vita-Illinois ("V-F Acquisition"), into the Company,
a Nevada corporation formed for purposes of effecting the reincorporation (the
"Reincorporation Merger").
In consideration of the preceding, the parties agree as follows:
1. As of the closing date of the IPO, Xxxxxxx X. Xxxxx ("Xxxxx"), Xxxxx
X. Xxxxxxx ("Xxxxxxx"), Xxxxxxx X. Xxxxxxxxxx ("Xxxxxxxxxx") and Xxxxx Xxxxx
will vote all of the shares of common stock of the Company which they
beneficially own which beneficial ownership currently is
1,245,202, shares, 622,303 shares, 88,661 shares and 282,870 shares,
respectively, and each of Rubin, Feldman, Xxxxxxxxxx and Xxxxx Xxxxx will cause
all members of his "Family" (defined below) who own any such shares of common
stock of the Company hereafter acquired from Rubin, Feldman, Xxxxxxxxxx or Xxxxx
Xxxxx, to vote all such shares for the election of Xxx Xxxxxxxxxx (or, if he is
unable to serve due to death or extended disability, Xxxxx Xxxxxxxxxx) as a
director of the Company for a period ending on the third anniversary of the
closing date of the IPO (the "Three Year Period"). The Company agrees that for
the Three Year Period, it will cause Xxx Xxxxxxxxxx (or, if he is unable to
serve due to death or extended disability, Xxxxx Xxxxxxxxxx) to be nominated
to the Company's Board of Directors, subject to the Board of Directors'
fiduciary duty. The Company also agrees that for the Three Year Period, it
will cause Xxx Xxxxxxxxxx (or, if he is unable to serve due to death or
permanent disability, Xxxxx Xxxxxxxxxx) to be appointed to the Compensation
Committee and the Audit Committee, subject to the Board of Directors' fiduciary
duty. As used in this
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Agreement, the term "Family" shall mean with respect to any natural person,
such person's spouse, brother, sister, parent or child or any descendant or
spouse (or spouse of any descendant) of any of the foregoing, or a trustee of a
trust primarily for the benefit of, or a custodian under the Uniform Transfers
to Minors Act or corresponding statute of any state for one or more of, the
foregoing or such person.
2. The Company will promptly pay and/or reimburse the Gorensteins for
the legal fees and costs incurred by Xxx Xxxxxxxxxx, Xxxxx Xxxxxxxxxx and J.B.F.
Enterprises in connection with the preparation and review of this Agreement and
their review of the registration statement and related documents prepared in
connection with the IPO in the amount reflected in the billing records of
Altheimer & Xxxx (which the Gorensteins agree to deliver to the Company) in an
aggregate amount not to exceed $20,000.00.
3. Effective upon the closing date of the IPO, Tthe Company will grant
"piggyback" registration rights to Xx. Xxx Xxxxxxxxxx, Xxxxx Xxxxxxxxxx and
J.B.F. Enterprises (collectively, the "Gorensteins") as provided in the
Registration Agreement attached hereto as Exhibit "A".
4. As of the closing date of the IPO and conditional on such closing,
the Gorensteins agree that the Settlement Agreement and General Release (the
"Settlement Agreement") entered into by Xxxxx Xxxxxxxxxx, Xxx Xxxxxxxxxx,
Xxx Xxxxxxxxxx and J.B.F. Enterprises with the Company, Xxxxxxx Xxxxx, Xxxxx
Xxxxxxx, Xxxxxxx Xxxxxxxxxx, Xxxx Xxxxxx ("Xxxxxx"), Xxxxxxx Xxxx ("Xxxx") and
V-F Acquisition on February 26, 1990 will be terminated and no longer of any
force or effect. As of the date hereof and not conditional on the closing of
the IPO, the Gorensteins hereby withdraw the notification of exercise of
dissenters' rights under Sections 11.65 or 11.70 of the Illinois Business
Corporation Act of 1983, as amended ("IBCA"), dated October 1, 1996, and the
Company accepts such withdrawal. As of the date hereof and not conditional on
the closing of the IPO, the Gorensteins agree not to take any further actions
under Sections 11.65 or 11.70 of the IBCA to perfect or exercise their right
to dissent and also waive any and all dissenters' rights or appraisal rights
they may have as a result of the Reincorporation Merger.
5. This Agreement will terminate and will no longer be of any force or
effect (except for the agreement to (i) pay and/or reimburse the legal fees and
costs set forth in Paragraph 2, (ii) withdraw the notification of exercise of
dissenters' rights set forth in Xxxxxxxxx 0, (xxx) not to take any further
actions to perfect or exercise dissenters' rights the Gorensteins may have as a
result of the Reincorporation Merger set forth in Paragraph 4, and (iv) waive
any and all dissenters' rights or appraisal rights the Gorensteins may have as a
result of the Reincorporation Merger set forth in Paragraph 4) if the Company
does not complete the IPO by March 31, 1997.
6. As of the closing date of the IPO, the Gorensteins, the Company,
Rubin, Feldman, Rubenstein, Jansen, Horn and V-F Acquisition hereby release and
discharge each of the others and each of their respective predecessors and
successors and all of their respective past and present employees, officers,
directors, stockholders, agents, attorneys, subsidiaries, affiliates and parent
corporations from any and all claims or causes of action known or unknown, which
any of such parties have or may have had from the beginning of time through the
date of this Agreement against any of the other parties arising out of the
Settlement Agreement or the Voting Agreement dated February 26, 1990
required by the Settlement Agreement.
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7. This Agreement constitutes the complete understanding among the
parties hereto. No alteration or modification of any of this Agreement's
provisions shall be valid unless made in a written instrument which all the
parties sign.
8. The laws of the State of Illinois shall govern all aspects of this
Agreement, irrespective of the fact that one or more of the parties now is or
may become a resident of a different state.
9. If a court of competent jurisdiction holds that any one or more of
this Agreement's provisions are invalid, illegal or unenforceable in any
respect, such invalidity, illegality or unenforceability shall not affect any of
this Agreement's other provisions, and this Agreement shall be construed as if
it had never contained such invalid, illegal or unenforceable provisions.
10. This Agreement may be executed in any number of counterparts and
each of such counterparts shall for all purposes constitute part of one
original.
11. The Company's Board of Directors has approved this Agreement by
having each of the Company's Directors sign this Agreement as a Director of the
Company.
12. This Agreement (except Paragraph 1) shall be binding upon the
parties as well as their respective heirs, personal representatives, successors
and assigns. This Agreement shall inure to the benefit of the parties as well as
their respective heirs, personal representatives, successors and assigns.
13. In connection with the IPO, the Gorensteins agree to execute an
agreement which will provide that for a period of thirteen months after the date
of the effective date of the registration statement prepared in connection with
the IPO, they will not offer, sell grant any option for the sale or otherwise
dispose of any securities of the Company (other than intra-family transfers or
transfer to trusts for estate planning purposes or dispositions upon their
death), without the prior written consent of National, which consent may be
given without prior public notice.
VITA FOOD PRODUCTS, INC.,
a Nevada Corporation J.B.F. ENTERPRISES
By: /s/Xxxxxxx Xxxxx By: /s/Xxx Xxxxxxxxxx
---------------------------------- -------------------------------
Xxxxxxx Xxxxx, President Xxx Xxxxxxxxxx, general partner
/s/Xxxxxxx Xxxxx /s/Xxx Xxxxxxxxxx
--------------------------------------- -------------------------------
Xxxxxxx X. Xxxxx, individually and as a Xxx Xxxxxxxxxx, individually and
Director of the Company as a Director of the Company
/s/Xxxxx X. Xxxxxxx /s/Xxxxx Xxxxxxxxxx
---------------------------------------- -------------------------------
Xxxxx X. Xxxxxxx, individually and as a Xxxxx Xxxxxxxxxx, indiviudally
Director of the Company
[Signatures continued on next page.]
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V-F ACQUISITIONS, INC., an Illinois
corporation
/s/Xxxxxxx Xxxx
-----------------------------------------
Xxxxxxx Xxxx, individually and as a
Director of the Company By: /s/Xxxxxxx X. Xxxxx
----------------------------
Xxxxxxx X. Xxxxx, President
/s/Xxxx Xxxxxx
-----------------------------------------
Xxxx Xxxxxx, individually and as a
Director of the Company
/s/Xxxxxxx X. Xxxxxxxxxx
-----------------------------------------
Xxxxxxx X. Xxxxxxxxxx, individually and
as a Director of the Company
/s/Xxxxx Xxxxx
-----------------------------------------
Xxxxx Xxxxx, individually
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EXHIBIT A
REGISTRATION AGREEMENT
THIS REGISTRATION AGREEMENT (this "Agreement"), dated September 20,
1996, is by and among VITA FOOD PRODUCTS, INC. a Nevada corporation (the
"Corporation"), and Xxx Xxxxxxxxxx, Xxxxx Xxxxxxxxxx and J.B.F. Enterprises, an
Illinois general partnership.
RECITAL
A. Pursuant to the Gorenstein Agreement dated September 20, 1996, the
Corporation, Xxx Xxxxxxxxxx, Xxxxx Xxxxxxxxxx and J.B.F. Enterprises deem it
desirable to enter into this Agreement.
AGREEMENTS
In consideration of the recital and the mutual promises and covenants
herein contained and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto hereby agree as
follows:
1. Definitions. As used in this Agreement:
"Commission" means the Securities and Exchange Commission.
"Common Stock" means the common stock of the Corporation, $.01 par
value per share.
"Gorensteins" mean Xxx Xxxxxxxxxx, Xxxxx Xxxxxxxxxx and J.B.F.
Enterprises and all members of their or its "Family" (defined below) who own any
shares of Common Stock of the Corporation as reflected in the Registration
Statement as being owned by Xxx Xxxxxxxxxx, Xxxxx Xxxxxxxxxx or J.B.F.
Enterprises which are hereafter acquired from the Gorensteins. As used in this
Agreement the term "Family" shall mean (a) with respect to any natural person,
such person's spouse, brother, sister, parent or child or any descendant or
spouse (or spouse of any descendant) of any of the foregoing, or a trustee of a
trust primarily for the benefit of, or a custodian under the Uniform Transfers
to Minors Act or corresponding statute of any state for one or more of the
foregoing or such person, and (b) with respect to any entity all beneficial
holders of equity interests in such entity.
"IPO" means the Corporation's initial public offering of shares of
Common Stock and Redeemable Common Stock Purchase Warrants for which National
Securities Corporation is acting as managing underwriter.
"Person" means a natural person, a partnership, a corporation, an
association, a joint stock company, a trust, a Joint venture, an unincorporated
organization or a governmental entity or any department, agency or political
subdivision thereof.
"Registrable Shares" means the shares of Common Stock beneficially
owned by the Gorensteins.
"Registration Expenses" has the meaning ascribed to it in Section 5 of
this Agreement.
"Registration Statement" means the registration statement on Form SB-2,
as amended and supplemented, declared effective by the Commission under the
Securities Act in connection with the IPO.
"Securities Act" means the Securities Act of 1933, as amended.
"Securities Exchange Act" means the Securities Exchange Act of 1934, as
amended.
2. Piggyback Registrations.
(a) Right to Piggyback. Whenever (i) the Corporation intends to sell
its securities in a primary offering pursuant to a registration statement filed
with the Commission or whenever the securities of the Corporation then issued
and outstanding are to be registered under the Securities Act but not including
the sale of the Corporation's securities pursuant to a registration statement
that the Corporation is required to, or has undertaken to, file in connection
with the IPO including, but not limited to, the registration statements required
to be filed to register the shares of Common Stock subject to the Warrants, the
Representative's Warrants and the Warrants underlying the Representative's
Warrants as defined in the Registration Statement (the "IPO Registrations"), or
a registration statement on Form S-8 or Form S-4, or their successors and (ii)
the registration form to be used may be used for the registration of Registrable
Shares (a "Piggyback Registration"), the Corporation will give prompt written
notice to the Gorensteins (at the address set forth in Section 14 hereof) of its
intention to effect such a registration and will include in such registration
and, if such registration is an underwritten registration, in the underwriting
agreement , subject to the terms of paragraphs (b) and (c) of this Section 2,
all of the Registrable Shares with respect to which the Corporation has received
a written request for inclusion therein within thirty (30) days after the
Corporation's notice has been given, provided, however, if no shareholders other
than the Gorensteins are participating in such registration, the Gorensteins
must request that at least 23,924 Registerable Shares be included in the
Piggyback Registration. The Corporation shall have the right to postpone or
withdraw any Piggyback Registration without obligation or liability to the
Gorensteins except for the payment of their reasonable legal fees and
disbursements incurred in connection with such Piggyback Registration pursuant
to Section 5.
(b) Priority on Primary Registrations. If a Piggyback Registration is
an underwritten primary registration on behalf of the Corporation, and the
managing underwriter(s) advise the Corporation that in their opinion the number
of securities requested to be included in such registration exceeds the number
which can be sold in such offering without having a material adverse effect on
the offering, the Corporation will include in such registration (A) first, the
securities the Corporation proposes to sell, (B) second, the Registrable Shares
requested to be included therein which in the opinion of such underwriter(s)
(after taking into account the securities to be sold pursuant to clause (A)) can
be sold without having a material adverse effect on the offering and (C) third,
other securities requested to be included in such registration which in the
opinion of such underwriter(s) can be sold (after
taking into account the securities to be sold pursuant to clauses (A),
and (B)) without having a material adverse effect on the offering.
(c) Priority on Secondary Registration. (i) If a Piggyback Registration
is not an underwritten primary registration on behalf of the Corporation and is
an underwritten secondary registration on behalf of holders of the Corporation's
securities who are not affiliates of the Corporation and who acquired the rights
to register their securities in connection with private placement by the
Corporation of its securities, and the managing underwriter(s) advise the
Corporation that in their opinion the number of securities requested to be
included in such registration exceeds the number which can be sold in such
offering without having a material adverse effect on the offering, the
Corporation will include in such registration (A) first, the securities
requested to be included therein by the holders requesting such registration
which in the opinion of such underwriter(s) can be sold without having a
material adverse effect on the offering, (B) second, the Registrable Shares
requested to be included therein which in the opinion of such underwriter(s) can
be sold (after taking into account the securities to be sold pursuant to clause
(A)) without having a material adverse effect on the offering, and (C) third,
other securities requested to be included in such registration which in the
opinion of such underwriter(s) can be sold (after taking into account the
securities to be sold pursuant to clauses (A), and (B)) without having a
material adverse effect on the offering.
3. Holdback Agreements.
(a) Each of the Gorensteins agrees not to effect any public sale or
distribution of equity securities of the Corporation, including any public
sale pursuant to Rule 144 under the Securities Act, or any securities
convertible into or exchangeable or exercisable for such securities, during the
period (i) commencing seven (7) days prior to and ending thirteen (13) months
after the effective date of the IPO, or (ii) commencing seven (7) days prior to
and ending sixty (60) days after the effective date of any underwritten
Piggyback Registration in which such Holder sells Registrable Shares (except as
part of such underwritten registration), unless the underwriters managing the
registered public offering otherwise agree.
(b) The Corporation agrees not to effect any public sale or
distribution of its equity securities, or any securities convertible into or
exchangeable or exercisable for such securities, during the period commencing
seven days (7) prior to and ending sixty (60) days after the effective date of
any underwritten Piggyback Registration (except as part of such underwritten
registration or pursuant to IPO Registrations or registrations on Form S-8 or
Form S-4 or any successor form), unless the underwriter(s) managing such
offering otherwise agree
4. Registration Procedures. Whenever the Corporation proposes to
register shares of its Common Stock and Gorensteins exercise their rights to
Piggyback Registration set forth in Section 3, the Corporation will use its best
efforts to effect the registration of such Registrable Shares under the
Securities Act and pursuant thereto the Corporation will as expeditiously as
possible:
(a) prepare and file with the Commission a registration statement with
respect to such Registrable Shares and use its best efforts to cause such
registration statement to become and remain effective for such period as may be
reasonably necessary to effect the sale of such securities, not to exceed three
(3) months;
(b) prepare and file with the Commission such amendments and
supplements to such registration statement and the prospectus used in connection
therewith as may be necessary to keep such registration statement effective for
such period as may be reasonably necessary to effect the sale of such
securities, not to exceed three (3) months, and otherwise as may be necessary to
comply with the provisions of the Securities Act with respect to the disposition
of all securities covered by such registration statement during such period;
(c) furnish the Gorensteins such number of copies of such registration
statement, each amendment and supplement thereto, the prospectus included in
such registration statement (including each preliminary prospectus) and such
other documents as the Gorensteins may reasonably request in order to facilitate
the disposition of the Registrable Shares;
(d) use its best efforts to register or qualify such Registrable Shares
under such other securities or blue sky laws of such jurisdictions as the
Gorensteins reasonably request and do any and all other acts and things which
may be reasonably necessary to enable the Gorensteins to consummate the
disposition in such jurisdictions of the Registrable Shares (provided that the
Corporation will not be required to (i) qualify generally to do business in any
jurisdiction where it would not otherwise be required to qualify but for this
subparagraph, (ii) subject itself to taxation in any such jurisdiction or (iii)
consent to general service of process in any such jurisdiction);
(e) use its best efforts to cause all such Registrable Shares to be
listed on each securities exchange on which similar securities issued by the
Corporation are then listed;
(f) provide a transfer agent and registrar for all such Registrable
Shares not later than the closing date of the sale of such shares;
(g) notify the Gorensteins 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;
(h) notify the Gorensteins of any request by the Commission for the
amending or supplementing of such registration statement or prospectus or for
additional information;
(i) prepare and promptly file with the Commission and promptly notify
the Gorensteins of the filing of such 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 the
light of the circumstances in which they were made, not misleading;
(j) advise the Gorensteins 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 threatening of any proceeding
for such purpose and promptly use all reasonable efforts to prevent the
issuance of any stop order or to obtain its withdrawal if such stop order should
be issued;
(k) at least forty-eight hours prior to the filing of any
registration statement or prospectus or any amendment or supplement to such
registration statement or prospectus, furnish a copy thereof to the Gorensteins;
(l) provided that the Gorensteins request that at least 23,924
Registerable Shares be included in an underwritten Piggyback Registration, at
the request of the Gorensteins, furnish on the date or dates provided for in the
underwriting agreement, a signed counterpart, addressed to the Gorensteins, of
(i) an opinion of counsel, and (ii) a letter or letters from the independent
certified public accountants of the Corporation, in each case covering such
matters as are customarily covered in opinions of issuer's counsel and in
accountants' letters delivered to underwriters in underwritten public offerings;
and
(m) use its best efforts to make generally available to its security
holders, earnings statements satisfying the provisions of Section 11(a) of the
Securities Act, no later than 45 days after the end of any twelve (12) month
period (or ninety (90) days, if such period is a fiscal year) (i)
commencing at the end of any fiscal quarter in which Registerable Shares are
sold to underwriters in an underwritten offering, or (ii) if not sold to
underwriters in such an offering, beginning with the first month of the
Corporation's first fiscal quarter commencing after the effective date of a
registration statement which includes Registerable Shares.
The Gorensteins shall furnish to the Corporation in writing such
information relating to the Gorensteins or the Registrable Shares as the
Corporation may reasonably request in connection with the preparation of a
registration statement including Registrable Shares. In addition, the
Gorensteins shall enter into and perform its obligations pursuant to any
underwriting agreement acceptable to the Gorensteins to be entered into with
respect to a registration that includes the Registrable Shares.
5. Registration Expenses. In connection with any Piggyback
Registration, the Corporation is obligated to pay Registration Expenses which
include all expenses of the Corporation incident to the Corporation's
performance of or compliance with this Agreement, including, without limitation,
all registration and filing fees, fees and expenses of compliance with
securities or blue sky laws, printing expenses, messenger and delivery
expenses, the expenses and fees for listing the securities to be
registered on each securities exchange or other market on which any shares of
Common Stock are then listed, and fees and disbursements of counsel for the
Corporation and its independent certified public accountants, underwriters
(excluding discounts and commissions attributable to the Registrable
Shares included in such registration) and other Persons (including the
reasonable legal fees and disbursements of one counsel for the Gorensteins)
retained by the Corporation (all such expenses being herein called "Expenses"),
will be borne by the Corporation. In addition, the Corporation will pay its
internal expenses (including, without limitation, all salaries and expenses of
its officers and employees performing legal or accounting duties), the expense
of any annual audit or quarterly review and the expense of any liability
insurance obtained by the Corporation.
6. Indemnification.
(a) The Corporation agrees to indemnify, to the fullest extent permitted
by law, the Gorensteins, their officers and directors and each Person who
controls the Gorensteins (within the meaning of the Securities Act or the
Securities Exchange Act) against all losses, claims, damages, liabilities and
expenses (including, without limitation, reasonable attorneys' fees except as
limited by Section 6(c)) caused by any untrue or alleged untrue statement of a
material fact contained in any registration statement, any final prospectus
contained therein or any amendment thereof or supplement thereto or any omission
or alleged omission of a material fact required to be stated therein or
necessary to make the statements therein not misleading, except insofar as the
same are caused by or contained in any information furnished in writing to the
Corporation by the Gorensteins expressly for use therein or by the Gorensteins'
failure to deliver a copy of the registration statement or final prospectus or
any amendments or supplements thereto after the Corporation has furnished the
Gorensteins with a sufficient number of copies of the same.
(b) In connection with any registration statement in which the
Gorensteins are participating, the Gorensteins will furnish to the Corporation
in writing such information and affidavits as the Corporation reasonably
requests for use in connection with any such registration statement or
prospectus and, to the fullest extent permitted by law, each Gorenstein will
indemnify the Corporation, its directors and officers and each underwriter (if
any) and each Person who controls the Corporation or such underwriter (within
the meaning of the Securities Act or the Securities Exchange Act) against any
losses, claims, damages, liabilities and expenses (including, without
limitation, reasonable attorneys' fees except as limited by Section 6(c))
resulting from any untrue or alleged untrue statement of a material fact
contained in the registration statement, final prospectus contained therein, or
any amendment thereof or supplement thereto or any omission or alleged omission
of a material fact required to be stated therein or necessary to make the
statements therein not misleading, but only to the extent that such untrue
statement or omission is contained in any written information or affidavit so
furnished in writing by such Gorenstein expressly for use therein.
(c) Any Person entitled to indemnification hereunder will (i) give
prompt written notice to the indemnifying party of any claim with respect to
which it seeks indemnification and (ii) unless in such indemnified party's
reasonable judgment a conflict of interest between such indemnified and
indemnifying parties may exist with respect to such claim, permit such
indemnifying party to assume the defense of such claim with counsel reasonably
satisfactory to the indemnified party. If such defense is assumed, the
indemnifying party will not be subject to any liability for any settlement made
by the indemnified party without the indemnifying party's consent (which consent
will not be unreasonably withheld). The indemnified party will not settle any
claim or liability without first providing the indemnifying party a reasonable
opportunity to assume the defense. An indemnifying party who is not entitled to,
or elects not to, assume the defense of a claim will not be obligated to pay the
fees and expenses of more than one counsel for all parties indemnified by such
indemnifying party with respect to such claim.
(d) The indemnification provided for under this Agreement will remain
in full force and effect regardless of any investigation made by or on behalf
of the indemnified party
or any officer, director or controlling Person of such indemnified party and
will survive the transfer of securities.
(e) If the indemnification provided for in this Section 6 is
unavailable or insufficient to hold harmless an indemnified party in respect of
any losses, claims, damages, liabilities or expenses referred to herein, then
the indemnifying party shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages, liabilities or
expenses in such proportion as is appropriate to reflect the relative fault of
the indemnifying party on the one hand, and the indemnified party on the other,
in connection with the statement or omission which resulted in such losses,
claims, damages, liabilities or expenses as well as any other relevant equitable
considerations. The relative fault of indemnifying party and the indemnified
party shall be determined by reference to, among other things, whether the
untrue or alleged untrue statement of a material fact relates to information
supplied by the indemnifying party or the indemnified party and the parties'
relative intent, knowledge, access to information and opportunity to correct or
prevent such statement or omission. The Corporation and the Gorensteins agree
that it would not be just and equitable if contributions pursuant to this
Section 6(e) were determined by pro rata allocation or by any other method of
allocation which did not take into account the equitable considerations referred
to herein. Notwithstanding the foregoing, in no event shall the Gorenstein's
liability under the indemnification agreement contained in Section 6(b) or the
amount contributed by the Gorensteins pursuant to this Section 6(e) exceed the
aggregate net offering proceeds received by the Gorensteins from the sale of the
Registerable Shares. No person guilty of fraudulent misrepresentations (within
the meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any person who is not guilty of such fraudulent
misrepresentation.
7. Current Public Information. At all times after the Corporation has
filed a registration statement with the Commission pursuant to the requirements
of either the Securities Act or the Securities Exchange Act, the Corporation
will use its best efforts to file in a timely manner all reports and other
documents required to be filed by it under the Securities Act and the Securities
Exchange Act and the rules and regulations adopted by the Commission to enable
such holders to sell Registrable Shares pursuant to Rule 144 adopted by the
Commission under the Securities Act (as such rule may be amended from time to
time) or any similar rule or regulation hereafter adopted by the Commission.
Upon request, the Corporation shall deliver to any Holder of Registrable Shares
a written statement as to whether it has complied with such requirements.
8. Participation in Underwritten Registrations. The Gorensteins may not
participate in any registration hereunder which is underwritten unless the
Gorensteins (a) agree to sell the Registrable Shares on the basis provided in
any underwriting arrangements approved by the Person or Persons entitled
hereunder to approve such arrangements and (b) complete and execute all
questionnaires, powers of attorney, indemnities, underwriting agreements and
other documents required under the terms of such underwriting arrangements.
Provided, however, that if shareholders other than the Gorensteins participate
in any registration which is underwritten and in which the Gorensteins
participate, the Gorensteins (a) shall be entitled to sell their Registerable
Securities on the same basis as the other selling shareholders as provided in
any underwriting arrangements approved by the Person or Persons entitled
hereunder to approve such arrangements and (b) shall be required to complete and
execute only the questionnaires, powers of attorney, indemnities, underwriting
agreements and other documents required to be completed and executed by the
other selling shareholders under the terms of such underwriting arrangements.
9. Amendments and Waivers. Except as otherwise expressly provided
herein, the provisions of this Agreement may be amended or waived at any time
only by the written agreement of the Corporation and the Gorensteins. Any
waiver, permit, consent or approval of any kind or character on the part of any
such Holders of any provision or condition of this Agreement must be made in
writing and shall be effective only to the extent specifically set forth in
writing.
10. Termination. This Agreement terminates on the earlier of (i) the
first date that the Gorensteins, in the aggregate, do not beneficially own more
than at least 23,924 Registerable Shares, or (ii) the date of the tenth
anniversary of the closing date of the IPO.
11. Final Agreement. This Agreement constitutes the final agreement of
the parties concerning the matters referred to herein, and supersedes all prior
agreements and understandings.
12. Severability. Whenever possible, each provision of this Agreement
will be interpreted in such manner as to be effective and valid under applicable
law, but if any provision of this Agreement is held to be prohibited by or
invalid under applicable law, such provision will be ineffective only to the
extent of such prohibition or invalidity, without invalidating the remainder of
this Agreement.
13. Descriptive Headings. The descriptive headings of this Agreement
are inserted for convenience of reference only and do not constitute a part of
and shall not be utilized in interpreting this Agreement.
14. Notices. Any notices required or permitted to be sent hereunder
shall be delivered personally or mailed, certified mail, return receipt
requested, or delivered by overnight courier service to the following addresses,
or such other addresses as shall be given by notice delivered hereunder, and
shall be deemed to have been given upon delivery, if delivered personally, three
business days after mailing, if mailed, or one business day after delivery to
the courier, if delivered by overnight courier service:
If to the Gorensteins to: J.B.F. Enterprises, 0000 Xxxxx Xxxxxxx
Xxxxxx, Xxxxx 000, Xxxxxxxxxxx, Xxxxxxxx, 00000. One notice sent to this address
constitutes notice to each of the parties defined herein as the "Gorensteins".
With a copy (which shall not constitute notice) to:
Altheimer & Xxxx
00 Xxxxx Xxxxxx Xxxxx
Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxx X. Xxxxxx
If to the Corporation, to:
Vita Food Products, Inc.
0000 Xxxx Xxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxxx X. Xxxxx
With a copy (which shall not constitute notice) to:
Much Shelist Freed Xxxxxxxxx
Xxxxx Xxxx & Xxxxxxxxxx, P.C.
000 Xxxxx XxXxxxx Xxxxxx
Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxxx X. Xxxxxxxxxx
15. Governing Law. All questions concerning the construction, validity
and interpretation of, and the performance of the obligations imposed by, this
Agreement shall be governed by and construed in accordance with the laws of the
State of Illinois (excluding the choice of law provisions thereof).
16. Counterparts. This Agreement may be executed in any number of
counterparts, each of which when so executed and delivered shall be deemed an
original, and such counterparts together shall constitute one instrument.
17. Agreement Binding. This Agreement shall be binding upon the parties
as well as their respective heirs, personal representatives, successors and
assigns.
VITA FOOD PRODUCTS, INC.
By:-------------------------------
Xxxxxxx X. Xxxxx, President
J.B.F. ENTERPRISES
By:--------------------------------
Xxx Xxxxxxxxxx, Partner
------------------------------------
Xxx Xxxxxxxxxx
------------------------------------
Xxxxx Xxxxxxxxxx
