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EXHIBIT 4.3
STOCKHOLDERS AGREEMENT
THIS STOCKHOLDERS AGREEMENT (this "Agreement") dated as of January 27,
1995, among Hanover Compressor Company, a Delaware corporation (the "Company")
and the other parties signatory hereto.
W I T N E S S E T H:
WHEREAS, each of the signatories hereto (other than the Company) is a
holder of shares of common stock, $0.001 par value, of the Company (the
"Stock"); and
WHEREAS, the parties hereto wish to provide for certain agreements and
understandings regarding, among others, the disposition of the Stock owned or
controlled by each of them.
NOW, THEREFORE, in consideration of the foregoing, of the mutual
covenants and agreements herein contained and of other good and valuable
consideration, the receipt, adequacy and sufficiency of which are hereby
acknowledged, the parties hereto hereby agree as follows:
ARTICLE I
DEFINITIONS; ETC.
1.1 Definitions. Except as otherwise herein expressly provided, the
following terms and phrases shall have the meanings set forth below:
"Affiliate" shall mean (i) in the case of an entity, any Person who or
which, directly or indirectly, through one or more intermediaries, controls or
is controlled by, or is under common control with, any specified Person or (ii)
in the case of an individual, such individual's spouse, children, grandchildren
or parents or a trust primarily for the benefit of any of the foregoing. With
respect to GKH, the term Affiliate shall expressly include the partners in GKH.
"Agreement" shall mean this Stockholders Agreement, as originally
executed and as amended, modified, supplemented or restated from time to time,
as the context requires.
"Bankruptcy" shall mean (i) an adjudication of bankruptcy under the
Federal Bankruptcy Reform Act of 1978, as amended, or any successor statute,
(ii) an assignment for the benefit of creditors, (ii) the filing of a voluntary
petition in bankruptcy or reorganization, or (iv) the failure to vacate the
appointment of a receiver or trustee for any part of the assets or property of
the Company within 60 days from the date of such appointment.
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"Board" shall mean the Board of Directors of the Company, as constituted
from time to time.
"Bona Fide Purchaser" shall mean any Person (other than a selling
Stockholder's Affiliates) who or which has delivered a good faith written offer
to purchase all, but not less than all, of such Stockholder's Stock; provided,
however, that, such Person has the requisite financial resources necessary, in
the reasonable opinion of the Board, to purchase and acquire such Stockholder's
Stock.
In addition to the requirements specified in the preceding sentence, if
at any time that a Bona Fide Purchaser makes an offer to purchase Seller's
Stock there exists a Seller's Liability, then, except as otherwise expressly
set forth herein, the Bona Fide Purchaser's offer must include the Bona Fide
Purchaser's written agreement to obtain the complete release of Seller and its
Affiliates from the Seller's Liability and to itself become personally liable
for the Seller's Liability if any relevant third-party lender so requires as a
condition for its complete release of Seller and its Affiliates. If any such
lender will not agree to so release Seller and its Affiliates from the Sellers'
Liability, then the Bona Fide Purchaser and its Affiliates shall, by written
agreement, indemnify and hold Seller and its Affiliates harmless from the
Seller's Liability from and after the date of the closing of the purchase and
sale of the Seller's Stock.
"Charter Documents" shall mean the collective reference to the
Certificate of Incorporation and Bylaws of a Person.
"Control" (including the terms "controlled by" and "under common control
with"), with respect to the relationship between or among two or more Persons,
means the possession, directly or indirectly or as trustee or executor, of the
power to direct or cause the direction of the affairs or management of a
Person, whether through the ownership of voting securities, as trustee or
executor, by contract or otherwise, including, without limitation, the
ownership, directly or indirectly, of securities having the power to elect a
majority of the board of directors or similar body governing the affairs of
such Person.
"Dispose" or "Disposition" (and any derivatives thereof) shall mean (i)
a voluntary or involuntary sale, assignment, transfer, conveyance or other
disposition of a Stockholder's Stock, and (ii) any agreement, contract or
commitment to do any of the foregoing.
"Encumbrance" or "Encumber" shall mean or refer to any lien, claim,
charge, pledge, mortgage, encumbrance, security interest, preferential
arrangement, restriction on voting or alienation of any kind, adverse interest,
or the interest of a third party under any conditional sale agreement, capital
lease or other title retention agreement.
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"GKH" shall mean the collective reference to (i) GKH Investments, L.P.,
a Delaware limited partnership ("Investments"), (ii) GKH Partners, L.P., a
Delaware limited partnership ("Partners") and (iii) the respective Affiliates
of Investments and Partners. Any and all decisions and determinations to be
made by GKH hereunder shall be made by Partners, for itself, Investments and
their respective Affiliates.
"Non-GKH Holders" shall mean any Stockholder other than GKH.
"Person" shall mean any individual, partnership, corporation, limited
liability company, joint venture, trust, firm, association, unincorporated
organization or other entity.
"Seller's Liability" means any personal liability of a Stockholder who
is selling its Stock pursuant to this Agreement for the repayment of any loans
made to the Company by a third party lender (whether pursuant to a guaranty,
loan, security or indemnification arrangement or otherwise).
"Stockholder or "Stockholders" shall mean the parties hereto (other than
the Company), their appropriate successors and assigns and any person who is
(i) a holder of Stock and (ii) is or is required to be a party to this
Agreement at the time of reference thereto.
"Subsidiary" shall mean with respect to any Person, (a) any corporation
(whether now existing or hereafter organized) of which at least a majority of
the voting stock having ordinary voting power for the election of directors is,
at the time as of which any determination is being made, directly or indirectly
owned or controlled by such Person or as to which such Person has the power to
direct the management or operations hereof, whether by contract or otherwise
and (b) any partnership, joint venture, association or other business entity
(whether now existing or hereafter organized) of which more than 50% of the
equity interest is, at the time as of which any determination is being made,
directly or indirectly owned or controlled by such Person or as to which such
Person has the power to direct the management or operations hereof, whether by
contract or otherwise.
"Transfer Notice" shall mean the notice required to be delivered by the
Seller to the Non-Selling Stockholders pursuant to Section 2.2. To be
effective, the Transfer Notice must (i) state the identity and the address of
the Bona Fide Purchaser who has offered, in writing, to purchase the Seller's
Stock, and (ii) state all material terms of such Bona Fide Purchaser's offer.
1.2 Certain Other Defined Terms. The following terms are defined in
the Section of this Agreement set forth directly opposite such terms:
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Term Section
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Company preamble
Exempt Disposition 2.1(a)
Participating Stockholder 2.4(b)
Purchasing Stockholder 2.2(c)
Secondary Notice 2.2(b)
Securities Act 2.1 (a)
Seller 2.2
Stock preamble
1.3 Article, Etc. References to an "Article" or a "Section" are,
unless otherwise specified, to one of the Articles or Sections of this
Agreement.
ARTICLE II
TRANSFER RESTRICTIONS
2.1 Transfer Restrictions.
(a) General Transfer Restriction. Each Stockholder covenants
and agrees that such Stockholder will not, and will not permit its Affiliates
to Dispose or cause the Disposition of such Stockholder's Stock or any interest
therein except (i) in accordance with the terms and conditions of this Article
II, (ii) pursuant to an effective registration statement under the Securities
Act of 1933, as amended (the "Securities Act") or (iii) pursuant to any public
distribution of Stock pursuant to Rule 144 of the Securities Act. The
Dispositions described in the immediately preceding clauses (ii) and (iii) are
sometimes collectively referred to herein as "Exempt Dispositions"). Any
attempted Disposition not in accordance with the terms and conditions of this
Agreement shall be null and void and of no force or effect.
(b) Transfers to Affiliates. Notwithstanding the restrictions
on Disposition set forth in this Article II, any Stockholder (which term for
the purposes of this Section 2.1(b) shall not include any Affiliate of a
Stockholder which acquired Stock pursuant to this Section 2.1(b)), may Dispose
of all or a portion of its Stock to an Affiliate; provided, however, that such
Stock shall remain subject to all of the terms and conditions of this Agreement
in the hands of the transferee thereof and that such transferees shall first
deliver to the Company and the Stockholders a written agreement assuming and
agreeing to be bound by all the terms and conditions of this Agreement and to
be a Stockholder hereunder.
(c) Indirect Transfers. Except as otherwise provided in this
Article II, no Stockholder may indirectly Dispose of its Stock
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(by way of transfer of the equity or other ownership interests of such
Stockholder or otherwise) to a Person other than an Affiliate of such
Stockholder without obtaining the prior written consent of the other
Stockholders (which consent may be given or withheld, in the sole and absolute
discretion of such Stockholders).
(d) Transfers to Persons other than Affiliates. Except as
otherwise provided in this Article II, no Stockholder may Dispose of its Stock
without the prior written consent of each of the other Stockholders (which
consent may be given or withheld, in the sole and absolute discretion of such
other Stockholders). Any Stock Disposed of pursuant to this Section 2.1(d)
shall remain subject to all of the terms and conditions of this Agreement in
the hands of any Person to whom such Stock may be Disposed and any such Person
shall be required to first deliver to the Company and the Stockholders a
written agreement assuming and agreeing to be bound by all of the terms and
conditions of this Agreement and to be a Stockholder hereunder.
(e) Transfer by GKH. The provisions of Section 2.1(d)
notwithstanding, GKH may, without complying with the provisions of this Article
11 Dispose of all or a portion of its Stock to its partners.
(f) Pledge. No Stockholder may Encumber its Stock for any
purpose other than to secure indebtedness to a third party commercial bank or
financial institution and the pledgee of such Stock agrees in writing to be
bound by the terms and conditions of this Agreement.
(g) Rules of Construction and General Application. The
following rules of construction shall be applicable to all transactions
consummated pursuant to Article II:
(i) Unless otherwise specifically set forth herein, a
reference to a Stockholder shall include any and all of such
Stockholder's Affiliates.
(ii) Other than Persons who are transferees of Stock
pursuant to Section 2.3 or 2.4 hereof, each transferee of Stock pursuant
to this Article II, as a condition to its admission as a Stockholder,
shall execute and acknowledge such instruments, in form and substance
satisfactory to the other Stockholders, as such other Stockholders shall
deem necessary or desirable to effectuate such transfer and to confirm
the agreement of the transferee of such Stock to be bound by all the
terms and provisions of this Agreement with respect to the Stock
acquired. All reasonable expenses, including attorneys' fees, incurred
by the Company in this connection shall be borne by such transferee.
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(iii) During the term of any proceedings, transactions or
Dispositions pursuant to any provision of Article II, no Stockholder may
exercise any rights under any provision of Article 11 (other than rights
granted to such Stockholder pursuant to the provision under which such
proceedings are taking place or in progress).
2.2 Dispositions by Stockholders.
(a) Offer from Bona Fide Purchaser. If a Non-GKH Holder (for
purposes of this Section 2.2, "Seller") desires to effect the Disposition of
all of its Stock to a Bona Fide Purchaser for cash, such Seller shall deliver
to the Company and to GKH a-Transfer Notice at least 45 days prior to the
proposed Disposition of Seller's Stock. Under no circumstances may any Seller
offer to sell less than all of its Stock to any such Bona Fide Purchaser.
(b) Right of First Refusal. By delivery of the Transfer
Notice, Seller shall be deemed to have offered GKH, or its respective
designees, the right and option to purchase on the terms and conditions set
forth in the Bona Fide Purchaser's-written offer all, or any portion of the
Seller's Stock. In order to exercise such option, GKH shall deliver written
notice to such effect to Seller and the Company within 25 days of its receipt
of the Transfer Notice. In the event that GKH exercises its rights for less
than 100% of the Seller's Stock pursuant to the first sentence of this Section
2.2(b), then the Company shall within 30 days of the date that the Transfer
Notice is deemed given hereunder provide the Non-GKH Holders with a notice (the
"Secondary Notice") setting forth the number of shares of Seller's Stock that
remain unpurchased following the initial 25 day exercise period. The
recipients of the Secondary Notice shall have 7 days from the date that the
Secondary Notice is deemed given to provide notice to Seller and the Company of
the additional amount of Seller's unpurchased Stock that each Non-GKH Holder
will purchase, which amounts shall be in such proportions as such Non-GKH
Holders shall agree among themselves, or failing such agreement in proportion
to their interest in the Company. If GKH and/or the Non-GKH Holders, or their
designees, who wish to participate exercise their respective options to
purchase all of the Seller's Stock, the consummation of the purchase and sale
of Seller's Stock shall occur in accordance with Section 2.2(c) hereof. A
failure by either GKH or a Non-GKH Holder to timely deliver any notice of
intent to purchase required pursuant to this Section 2.2(b) shall constitute
such Persons's failure to exercise its rights under this Section 2.2(b).
(c) Consummation of Purchase.
(i) The purchase price payable by either GKH or a Non-
GKH Holder or their respective designees (collectively, the "Purchasing
Stockholder") to Seller shall be paid as set
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forth in the Bona Fide Purchaser's offer (except that no payment need be
made until at least 30 days subsequent to the completion of the
procedure described in Section 2.2(b), if applicable) and Seller's Stock
shall be transferred as provided in such written offer.
(ii) At the closing of the purchase and sale of Seller's
Stock pursuant to Section 2.2(b), (A) each Purchasing Stockholder shall
deliver to Seller any and all consideration required pursuant to the
terms of the Bona Fide Purchaser's offer and (B) Seller shall deliver to
each such Purchasing Stockholder appropriate instruments of assignment
duly executed in a proper form to effect the transfer of such Stock from
Seller to each such Purchasing Stockholder on the books and records of
the Company.
(iii) If at the closing of the purchase and sale of
Seller's Stock, there exists a Seller's Liability with respect to
Seller, the Purchasing Stockholder(s) shall either severally (A) assume
the Seller's Liability, or (B) in the event that such assumption is not
permitted by a lender or other relevant Person, indemnify and hold
Seller harmless, by written agreement reasonably satisfactory in form
and substance to Seller, from and against such Seller's Liability from
and after the date of such closing.
(d) Other Disposition Provisions.
(i) If Purchasing Stockholders do not agree to purchase
all of Seller's Stock by the expiration of the periods set forth in
Section 2.2(b), Seller shall have 60 days thereafter in which to effect
the Disposition of its Stock to the Bona Fide Purchaser on terms not
more favorable than were set forth in the Bona-Fide Purchaser's written
offer.
(ii) During the term of the rights granted to the GKH
and GKH Non-Holders (other than Seller) pursuant to Section 2.2, Seller
shall not negotiate or offer to sell its Stock on terms and conditions
more favorable to a purchaser than those previously offered to the GKH
and the Non-GKH Holders.
(iii) If Seller shall fail to consummate a Disposition of
its Stock within the time period set forth in Section 2.2(d)(i), then no
Disposition of such Stock may be made by Seller without first re-
offering such Stock to the GKH and the Non-GKH Holders in accordance
with the provisions of this Section 2.2.
2.3 Rights to Compel Disposition.
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(a) Rights of GKH. If GKH proposes to Dispose of all (but not
less than all) of its Stock to a Bona Fide Purchaser other than pursuant to an
Exempt Disposition, then, notwithstanding anything in this Agreement to the
contrary, GKH may require the Non-GKH Holders to Dispose of their Stock to such
Bona Fide Purchaser for the same consideration per share and otherwise on the
same terms and conditions (other than with respect to representations and
warranties) upon which GKH effects the Disposition of its Stock.
(b) Obligations of the Non-GKH Holders. In the event that GKH
desires to exercise its right pursuant to Section 2.3(a), GKH shall deliver to
the Company and the Non-GKH Holders written notice setting forth the
consideration per share of Stock to be paid by such Bona Fide Purchaser and the
other terms and conditions of such Disposition. Such notice shall also
constitute a Transfer Notice. Subject to Section 2.2(b), within 25 days (or 32
days, if a Secondary Notice is delivered) following the date of such notice,
the Non-GKH Holders shall deliver to GKH (i) an appropriate assignment duly
executed in a proper form to effect the Disposition of such Stock from the Non-
GKH Holders to the Bona Fide Purchaser on the books and records of the Company
and (ii) a limited power-of-attorney authorizing GKH to effect the Disposition
of such Stock pursuant to the terms of such Bona Fide Purchaser's offer as such
terms may be modified by GKH, provided, that all of the Non-GKH Holder's Stock
is disposed of for the same consideration per share of Stock and otherwise on
the same terms and conditions upon which GKH effects the Disposition of its
Stock. In the event that any Non-GKH Holder shall fail to deliver such
documentation, assignment and limited power-of-attorney to GKH, the Company
shall cause a notation to be made on its books and records to reflect that the
Stock of the such Non-GKH Holder is bound by the provisions of this Section 2.3
and that the Disposition of such Stock may be effected without the such Non-GKH
Holder's consent or surrender of its Stock.
ln addition, in the event GKH exercises its rights under Section 2.3(a),
the Non-GKH Holders shall be required to make to a Bona Fide Purchaser such
unqualified representations and warranties with respect to their Stock as are
set forth in Section 2.5(b) hereof and representations and warranties qualified
to knowledge with respect to all other matters as are reasonably requested be
the Bona Fide Purchaser.
(c) Responsibility of GKH. Promptly (but in no event later
than the day of receipt) after the consummation of the Disposition of Stock
pursuant to this Section 2.3, GKH shall (i) deliver notice thereof to the Non-
GKH Holders, (ii) remit to the Non-GKH Holders the total sales price of their
Stock Disposed of pursuant hereto, and (iii) furnish such other evidence of the
completion and time of completion of such Disposition and the terms
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thereof as may be reasonably requested in writing by the Non-GKH Holders.
(d) Failure to Effect Transfer. If, within 90 days after
GKH's delivery of the notice required pursuant to Section 2.3(b), GKH has not
completed the Disposition of its Stock and that of the Non-GKH Holders in
accordance herewith, GKH shall return to the Non-GKH Holders (i) the
assignments with respect to the Non-GKH Holders' Stock which the Non-GKH
Holders delivered pursuant to this Section 2.3 and (ii) the related limited
power-of-attorney. Upon the Non-GKH Holder's receipt of such materials, all
the restrictions on Disposition contained in this Agreement with respect to the
Stock owned by the Stockholders shall again be in effect.
2.4 Rights of Inclusion.
(a) Rights of the Non-GKH Holders. If GKH proposes to Dispose
of any or all of its Stock to a Bona Fide Purchaser, then, the Non-GKH Holders
may require GKH to require the Bona Fide Purchaser to purchase up to the same
percentage of the Stock then owned by such Non-GKH Holders as is proposed to be
sold by GKH to such Bona Fide Purchaser in accordance with this Section 2.4(a)
for the same consideration per share and otherwise on the same terms and
conditions (other than with respect to representations and warranties) upon
which GKH effects the Disposition of its Stock.
(b) Obligations of Participating Stockholder. If GKH desires
to accept a Bona Fide Purchaser's offer to purchase all of GKH's Stock in
accordance with Section 2.4(a), GKH shall deliver a copy of the Bona Fide
Purchaser's offer to the Company and the Non-GKH Holders, and, within 30 days
of the receipt of such copy, in the event that any Non-GKH Holders desires to
exercise its rights pursuant to this Section 2.4 (each a "Participating
Stockholder"), such Participating Stockholder shall deliver to GKH and the
Company written notice to such effect and shall deliver to GKH (i) an
appropriate assignment duly executed in a proper form to effect the Disposition
of such Stock to the Bona Fide Purchaser on the books and records of the
Company and (ii) a limited power-of-attorney authorizing GKH to effect the
Disposition of such Stock pursuant to the terms of such Bona Fide Purchaser's
offer as such terms may be modified by GKH, provided, that all of the
Participating Stockholder's Stock that is being transferred pursuant to this
Section 2.4 is Disposed of for the same consideration per Unit and otherwise on
the same terms and conditions upon which effects the Disposition of its Stock.
The failure of a Participating Stockholder to deliver notice of its desire to
exercise its rights under or to otherwise comply with the provisions of this
Section 2.4(b) shall be deemed to be a waiver of the Participating
Stockholder's rights hereunder.
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The Participating Stockholders shall be required to make to a Bona Fide
Purchaser such unqualified representations and warranties with respect to their
Stock as are set forth in Section 2.5(b) hereof and representations and
warranties qualified to knowledge with respect to all other matters as are
reasonably requested by the Bona Fide Purchaser.
(c) Responsibility of GKH. In the event that any
Participating Stockholder timely exercises its rights of inclusion under this
Section 2.4, promptly (but in no event later than the day of receipt) after the
consummation of the sale of Stock under this Section 2.4, GKH shall (i) deliver
notice thereof to each Participating Stockholder, (ii) remit to each
Participating Stockholder the total sales price of such Participating
Stockholder's Stock sold pursuant hereto and (iii) furnish such other evidence
of the completion and time of completion of such Disposition and the terms
thereof as may be reasonably requested in writing by each Participating
Stockholder.
(d) Failure to Effect Transfer. In the event that any
Stockholder elects to exercise its rights of inclusion under this Section 2.4
as a Participating Stockholder, if, within 60 days after GKH's delivery of the
copy of the Bona Fide Purchaser's offer pursuant to Section 2.4(b), GKH has not
completed the Disposition of its Stock and that of the Participating
Stockholders in accordance herewith, GKH shall return to each Participating
Stockholder (i) the assignments with respect to each Participating
Stockholder's Stock which each Participating Stockholder delivered for
Disposition pursuant to this Section 2.4 and (ii) the related limited power-of-
attorney. Upon the Participating Stockholders' receipt of such materials, all
the restrictions on Disposition contained in this Agreement with respect to the
Stock owned by the Stockholders shall again be in effect.
2.5 Agreement of Selling Stockholders. All sales of Stock to be made
pursuant to Sections 2.2., 2.3 and 2.4 of this-Agreement shall be subject to
the following terms:
(a) the Disposing Stockholder shall deliver to the purchaser
the Stock being sold, free and clear of Encumbrances (other than those set
forth in Section 2.1(d)), together with duly executed stock transfer powers in
favor of the purchaser or its nominees and such other documents, including
evidence of ownership and authority, as the purchaser may reasonably request;
and
(b) the Disposing Stockholder shall not be required to make
any unqualified representations or warranties to any Person in connection with
such sale, except as to (i) good title to the Stock being sold, (ii) the
absence of Encumbrances with respect to the Stock being sold, (iii) its valid
existence and good standing (if applicable), (iv) the authority for, and
validity and binding effect of (as against such Disposing Stockholder), any
agreement
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entered into by such Disposing Stockholder in connection with such sale, (v)
all required material consents to Disposing Stockholder's sale and material
governmental approvals having been obtained (excluding any securities laws) and
(vi) the fact that no broker's commission is payable by the Disposing
Stockholder as a result of Disposing Stockholder's conduct in connection with
the sale:
ARTICLE III
ADDITIONAL AGREEMENTS
3.1 Designation of Board Members. Prior to the consummation of an
initial public offering (an "IPO") of securities by the Company, the Non-GKH
Holders will be entitled to designate a maximum of two of the members of the
Board which GKH would otherwise be entitled to designate so long as after
giving effect to such designations by the Non-GKH Holders, GKH has the right to
designate a majority of the member of the Board exclusive of the Non-GKH Holder
Board members. Following the consummation of an IPO or in the event GKH would
not be able to designate a majority of the Board as described in the
immediately preceding sentence, the Non-GKH Holders will be entitled to
designate one member of the Board which GKH would otherwise have the right to
designate. The person or persons designated by the Non-GKH Holders pursuant to
this Section 3.1 are hereinafter referred to as the "Non-GKH Designee" or "Non-
GKH Designees", as the case may be.
3.2 Major Decisions. Notwithstanding any other provision of this
Agreement or the Charter Documents, the Board of Directors shall not, without
the vote or the prior written consent of the Non-GKH Designees have the power
to approve any transaction, series of transactions, act, or series of acts,
which would:
(a) cause the Company or any of its Subsidiaries to engage in
any material respect in any business other than a business relating to energy
or energy servicing or any business reasonably related or ancillary thereto;
(b) cause the Company or any of its Subsidiaries to execute
and deliver any contracts or agreements with, or be a party to, or have an
interest, directly or indirectly, in any transaction, contract or commitment
that relates to or affects, the Company or any of its Subsidiaries (including,
but not limited to, any contract, agreement or other arrangement providing for
the advancement of funds, furnishing of services by, or rental of real or
personal property from, otherwise requiring payments to, any such Stockholder
or Affiliate thereof) or any transaction that would be required to be disclosed
pursuant to Item 404 of Regulation S-K, adopted by the Securities and Exchange
Commission if each of the Company or any of its Subsidiaries, as applicable,
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were publicly traded companies, with or to any Stockholder or his or its
respective Affiliates;
(c) except as required to effectuate the provisions of this
Agreement (i) cause the Company, or any of its Subsidiaries to amend its
Charter Documents in a manner inconsistent with this Agreement or (ii) cause
the Company to declare, set aside or pay any dividend or other distribution or
make any payment in cash, stock or property in respect of any shares of its
Stock, unless such dividend distribution or payment is to be distributed among
the Stockholders pro rata in accordance with their respective percentage
ownership of the applicable class of stock then outstanding; and
(d) cause a disposition of the Company or any of its
Subsidiaries in which the proceeds distributable or payable in respect of such
disposition to the Stockholders are shared among the Stockholders other than on
a pro rata basis in accordance with their then ownership of Stock and any other
classes of the Company's capital stock then issued and outstanding.
3.3 Business Opportunities and Conflicts. Each Stockholder
recognizes that each other Stockholder has or may have other business
interests, activities and investments and that, subject to this Section 3.3,
each such other Stockholder is entitled to carry on such other business
interests, activities and investments. No such other Stockholder shall be
obligated to devote all or any particular part of his or its time and effort to
the Company and its affairs. Subject to this Section 3.3, each such other
Stockholder may engage in or possess an interest in any other business or
venture of any kind, independently or with others, on its own behalf or on
behalf of other entities with which it is affiliated or associated; provided,
however, that in the event any Stockholder or its Affiliates engages in or
makes an investment in any business or entity competitive with the business
then being conducted by the Company or any Subsidiary thereof, it shall have
the obligation to notify the Board of Directors in writing of such conflict
prior to such Stockholder or Affiliate engaging or investing in any such
competitive business, together with a statement describing the measures taken
to ensure that information regarding the Company and its Subsidiaries
obtainable by such Person as a result of its relationship with the Company will
not be disclosed to such Person. In the event the measures to be taken are not
satisfactory in the reasonable judgment of a majority of the disinterested
members of the Board of Directors, such majority of the Board of Directors may
impose such alternative or additional measures as it may determine are
reasonably necessary to protect the proprietary information of the Company from
potentially harmful and/or unauthorized disclosure.
3.4 Registration Rights Agreement. Each of the parties hereto shall
concurrently with the execution and delivery of this
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agreement execute and deliver a counterpart of the Registration Right Agreement
substantially in the form attached hereto as Exhibit A.
ARTICLE IV
MISCELLANEOUS PROVISIONS
4.1 Endorsement on Stock Certificates. Each and every certificate
evidencing Stock shall contain upon its face, or on the reverse side thereof,
the following legend:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE (i) HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY
NOT BE PLEDGED, HYPOTHECATED, TRANSFERRED, OFFERED FOR SALE OR
SOLD EXCEPT PURSUANT TO A REGISTRATION UNDER SAID ACT OR AN
OPINION OF COUNSEL, REASONABLY SATISFACTORY TO COUNSEL FOR THE
COMPANY, THAT SUCH REGISTRATION IS NOT REQUIRED UNDER SAID ACT
AND (ii) ARE SUBJECT TO THE PROVISIONS OF THAT CERTAIN
STOCKHOLDERS AGREEMENT DATED AS OF _________, 1994 AS AMENDED
FROM TIME TO TIME AMONG THE COMPANY AND EACH OF THE STOCKHOLDERS
SPECIFIED THEREIN, COPIES OF WHICH ARE AVAILABLE AT THE PRINCIPAL
OFFICES OF THE COMPANY.
4.2 Termination. This Agreement shall terminate upon the earliest to
occur of the following events:
(a) Bankruptcy of the Company;
(b) the consummation of a publicly registered offering of 25%
or more of the common stock of the Company;
(c) 100% of the Stock being owned by a single Stockholder;
(d) the voluntary agreement, in writing, of all of the
Stockholders; or
(e) September __, 2004.
4.3 Stock Subject to this Agreement.
(a) This Agreement shall apply to all Stock currently or
hereinafter owned or acquired by the Stockholders, including, without
limitation, (i) the Stock held by the Stockholders on the date hereof, (ii) any
Stock issued to any Stockholder pursuant to Section 4.2(b) hereof, (iii) any
Stock issued to any Stockholder pursuant to such Stockholder's exercise of an
option or warrant and (iv) any Stock otherwise purchased, acquired or issued to
any Stockholder.
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(b) If, at any time, and from time to time, the Company shall
declare and make a distribution upon any of the Stock, or shall validly issue
Stock in lieu of, or in exchange for, or in addition to, any of the Stock
without the receipt of additional consideration therefor, then any such Stock
subsequently issued with respect to the Stock then subject to this Agreement
shall constitute additional Stock subject to this Agreement.
4.4 Notices. Any and all notices or other communications provided
for herein shall be in writing and shall be considered duly given upon the
earliest to occur of (a) personal delivery, (b) 2 days after being delivered to
a national recognized overnight delivery courier or service, (c) 3 days after
being mailed by registered or certified mail, return receipt requested, postage
prepaid or (d) the delivering parties receipt of a written confirmation of a
facsimile transmission. All notices shall be addressed to the Stockholders at
their addresses listed on the signature pages of this Agreement. Any party
hereto may change his or its address by giving notice to the other parties
hereto as provided herein.
4.5 Pronouns and Headings. As used herein, all pronouns shall
include the masculine, feminine, neuter, singular and plural wherever the
context and facts require such construction. The descriptive headings in the
sections of this Agreement are inserted for convenience of reference only and
shall not control or affect the meaning or construction of any of the
provisions hereof.
4.6 Severability. If any provision of this Agreement is held by a
court of competent jurisdiction to be invalid, illegal or unenforceable, such
provision shall be severed and the remaining provisions hereof shall be
enforced to the extent possible or modified in such a way as to make it
enforceable, and the invalidity, illegality or unenforceability thereof shall
not affect the validity, legality or enforceability of the remaining provisions
of this Agreement.
4.7 Modification; Amendment. No modification or amendment of this
Agreement shall be valid unless the same shall be in writing executed by all of
the Stockholders.
4.8 Governing Law. This Agreement shall be governed by and construed
in accordance with the laws of the State of Delaware, without regard to the
conflict of laws provisions thereof
4.9 Binding Effect; Complete Agreement. This Agreement shall be
binding upon and shall inure to the benefit of the parties hereto and their
respective heirs, personal representatives, successors and assigns. This
Agreement constitutes the entire agreement among the parties hereto and
supersede all prior agreements and understandings, oral or written, among the
parties hereto with respect to the subject matter hereof.
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4.10 Specific Performance. The parties acknowledge that given the
nature of the obligations of the parties hereto that any non-breaching party
will be irreparably damaged by a breach of this Agreement. The parties hereto
therefore acknowledge and agree that any non-breaching party hereto may seek
specific performance of the provisions hereof and that no party hereto may
assert adequacy of a remedy at law as a defense to an action for specific
performance hereunder.
4.11 Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, and all of which
together shall constitute one and the same instrument.
4.12 Attorneys' Fees. If any legal action, including an action for
declaratory relief, is brought to enforce any provision of this Agreement, the
prevailing party or parties, as the case may be, shall be entitled to recover
his, its or their respective reasonable attorneys' fees from non-prevailing
party or parties, as the case may be. These fees, which may be set by the
court in the same action or in a separate action brought for that purpose, are
in addition to any other relief to which any prevailing party may be entitled.
4.13 Governing Law. This Agreement shall be governed by and construed
in accordance with the laws of the State of Delaware without regard to the
conflict of laws provisions thereof.
4.14 Counterparts. This Agreement may be executed in any number of
counterparts and by the parties hereto in separate counterparts, each of which
when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement.
4.15 Headings. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.
4.16 Severability. In the event that any one or more of the
provisions contained herein, or the application thereof in any circumstances,
is held invalid, illegal or unenforceable, the validity, legality and
enforceability of any such provision in every other respect and of the
remaining provisions contained herein shall not be affected or impaired
thereby.
4.17 Entire Agreement. This Agreement is intended by the parties as a
final expression of their agreement and intended to be a complete and exclusive
statement of the agreement and understanding of the parties hereto in respect
of the subject matter contained herein. There are no restrictions, promises,
warranties or undertakings, other than those set forth or referred to herein
with respect to the registration rights granted by the Company with respect to
the securities now or hereafter owned by
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the Holders. This Agreement supersedes all prior agreements and understandings
between the parties with respect to such subject matter.
4.18 Attorneys' Fees. In any action or proceeding brought to enforce
any provision of this Agreement, or where any provision hereof or thereof is
validly asserted as a defense, the successful party shall be entitled to
recover, and the court shall award, reasonable attorneys' fees in addition to
its costs and expenses and any other available remedy.
IN WITNESS WHEREOF, this Agreement has been duly executed by the parties
as of the date first above written.
HANOVER COMPRESSOR COMPANY
By:
-------------------------------
Title:
GKH PARTNERS, L.P., a Delaware
limited partnership
By: JAKK HOLDING CORP., a
general partner
By:
--------------------------
Xxxxxx X. Xxxxx, President
GKH INVESTMENTS, L.P., a
Delaware limited partnership
By: GKH Partners, L.P., its
general partner
By: JAKK Holding Corp., a
general partner
By:
-------------------------
Xxxxxx X. Xxxx, President
----------------------------------
Xxxxxx Xxxxxxxxxx, Xx.
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-------------------------
Xxxxxxx X. Xxxxxxxx
-------------------------
Xxxxxxx X. Xxxxx, Xx.
-------------------------
J. Xxxxx Xxxxx
-------------------------
Xxxx Xxxx Xxxxx Xxxxxx
-------------------------
Xxxxx Xxxxx Xxxxxx
-------------------------
Xxxxx Xxxxx Xxxxx
-------------------------
Xxxxx Xxxxx Xxxxx
-------------------------
Xxxxxxx Xxxxxxx Xxxxx
(i) as Trustee of the
Trust for the Benefit of
Xxxxxxx X. Xxxxx, Xx.
-------------------------
Xxxxx X. Xxxxxxxxx
-------------------------
Xxxx Xxxxxx, jointly with
C. Xxxxx Xxxxx, solely in
his capacity:
(i) as Trustee of the
Trust for the Benefit of
Xxxxx Xxxxxxxxx
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(ii) as Trustee of the Trust for the
Benefit of Xxxx Xxxxxxxxx
(iii) as Trustee of the Trust for the
Benefit of Xxxxxxxxxxx Xxxxxxxxx
(iv) as Trustee of the Trust for the
Benefit of Xxxxx Xxxxxxxxx
---------------------------------------
C. Xxxxx Xxxxx, jointly with Xxxx
Xxxxxx, solely in his capacity:
(i) as Trustee of the Trust for the
Benefit of Xxxxx Xxxxxxxxx
(ii) as Trustee of the Trust for the
Benefit of Xxxx Xxxxxxxxx
(iii) as Trustee of the Trust for the
Benefit of Xxxxxxxxxxx Xxxxxxxxx
(iv) as Trustee of the Trust for the
Benefit of Xxxxx Xxxxxxxxx
---------------------------------------
Xxxxx X. Xxxxxxxxx
---------------------------------------
C. Xxxxx Xxxxx, solely in his capacity:
(i) as Trustee of the Trust for the
Benefit of Xxxxx Xxxxxxxxx
(ii) as Trustee of the Trust for the
Benefit of Xxxx Xxxxxxxxx
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(iii) as Trustee of the Trust for the
Benefit of Xxxxxxxxxxx Xxxxxxxxx
(iv) as Trustee of the Trust for the
Benefit of Xxxxx Xxxxxxxxx
----------------------------------------
C. Xxxxx Xxxxx, solely in his capacity:
(i) as Trustee of the Trust for the
Benefit of Xxxxx Xxxxxxxxx
(ii) as Trustee of the Trust for the
Benefit of Xxxx Xxxxxxxxx
(iii) as Trustee of the Trust for the
Benefit of Xxxxxxxxxxx Xxxxxxxxx
(iv) as Trustee of the Trust for the
Benefit of Xxxxx Xxxxxxxxx
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AGREEMENT TO BE BOUND BY STOCKHOLDERS' AGREEMENT
Reference is hereby made by that certain Stockholders' Agreement of
Hanover Compressor Company, a Delaware corporation (the "Company"), dated as of
January 27, 1995 (the "Stockholders' Agreement") among the Company and the
stockholders of the Company parties thereto. Capitalized terms used herein and
not otherwise defined shall have the meanings ascribed to them in the
Stockholders' Agreement.
In connection with the proposed subscription by the undersigned for
shares of the 6.5% Cumulative Redeemable Series A Preferred Stock, $.01 par
value (the "Series A Preferred Stock"), of the Company and warrants
("Warrants") for the purchase of shares of common stock, $.001 par value (the
"Common Stock") of the Company, and in order to obtain the benefit and burdens
of the Stockholders' Agreement, the undersigned, for itself, agrees to be bound
by the terms and conditions of the Stockholders' Agreement as a Stockholder
thereunder and agrees and acknowledges that the aforementioned securities
received by him or it will be treated as Stock thereunder, with all the
benefits and burdens thereof.
Dated: August ___, 1995.
IPP95, L.P.
BY: WESINVEST, INC., its General Partner
---------------------------------------
By:
-----------------------------------
Name:
---------------------------------
Its:
---------------------------------
AGREED AND CONFIRMED:
HANOVER COMPRESSOR COMPANY,
a Delaware corporation
By:
---------------------------
Name:
-------------------------
Its:
--------------------------
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CONSENT
The undersigned, spouses of parties to the foregoing Stockholders
Agreement, hereby consent to the execution of the Stockholders Agreement and
the consummation of the transactions contemplated thereby by their respective
spouses and hereby waive any and all rights they may have in and to the
property and subject matter of the Stockholders Agreement by virtue of their
marital relationship to a party thereto.
-------------------------------
-------------------------------
-------------------------------
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