Exhibit 3.23
SHAREHOLDER'S AGREEMENT
THIS SHAREHOLDER'S AGREEMENT (the "Agreement") is made and entered into as
of March 19,1997, by and between Food Extrusion, Inc., a Nevada corporation
("Foodex") and CF Corporation an Idaho corporation (the "Shareholder").
RECITALS
A. Foodex, Food Extrusion Montana, Inc., a Montana corporation
("Purchaser") and the Shareholder have entered into that certain Asset Purchase
Agreement dated as of January 2, 1997 (the "Asset Purchase Agreement"), whereby
Purchaser shall purchase the assets and assume the liabilities of the
Shareholder described in the Asset Purchase Agreement.
B. As consideration for the purchase of assets, Purchaser and Foodex shall
assume certain obligations and liabilities of the Shareholder described in the
Asset Purchase Agreement and Foodex shall issue 310,000 shares of its common
stock, $.001 par value (the "Shares"), of Foodex to the Shareholder.
C. As an inducement to and as a condition of, the parties entering into the
Asset Purchase Agreement, (i) Foodex shall grant to the Shareholder a put to
sell the Shares to Foodex for $5.00 per share, upon the terms and conditions set
forth herein and (ii) the Shareholder shall grant to the Company a right of
first refusal with respect to any transfer of the Shares, upon the terms and
conditions set forth herein.
D. The execution and delivery of this Agreement by the parties hereto is a
condition precedent to the obligations of Foodex, Purchaser and the Shareholder
under the Asset Purchase Agreement.
AGREEMENT
NOW THEREFORE, in consideration of the premises, covenants and agreements
contained herein, the sufficiency and adequacy of which are hereby acknowledged,
and for other good and valuable consideration the sufficiency and adequacy of
which is hereby acknowledged, and intending to be legally bound hereby, the
parties hereto agree as follows:
1. Issuance of Shares.
On the Closing Date (as defined in the Asset Purchase Agreement), Foodex
shall issue an aggregate of 310,000 shares of common stock of Foodex to the
Shareholder. The Shares shall be issued pursuant to the exemption from
registration set forth in Section 3(a)(10) of the Securities Act of 1933, as
amended (the "Act") and shall be subject to the restrictions on transfer in
Sections 4 and 7 below.
2. Put.
2.1 The Put. Foodex hereby irrevocably grants and issues to the Shareholder
the right and option to sell to Foodex on November 1, 1998 and for a period of
thirty (30) calendar days thereafter (hereinafter referred to as the "Put") any
or all of the Shares at a purchase price of $5.00 per share (as adjusted
pursuant to Section 6 below) (the "Put Price"). The right of the Shareholder to
exercise the Put under this Section 2 is not transferable, except to the extent
Shares are transferred in compliance with Section 4.2 below.
2.2 Exercise of Put. The Shareholder may exercise the Put and sell to
Foodex, and Foodex agrees to purchase from the Shareholder, all of the Shares
put to Foodex on November 1, 1998 and for thirty (30) calendar days thereafter
(the "Exercise Period"). A Shareholder shall exercise the Put during the
Exercise Period by delivery of a written notice to Foodex specifying the number
of Shares as to which the Put shall be exercised.
2.3 Payment and Delivery of Shares. Foodex shall, within twenty (20)
calendar days of the receipt of notice from a Shareholder of its exercise of the
Put, pay to such Shareholder in cash or by check, $5.00 plus all accumulated
dividends, if any, for each Share as to which such Shareholder has exercised the
Put in exchange for the delivery to Foodex of a stock certificate or
certificates representing the total number of Shares being put and purchased,
duly endorsed in blank by the Shareholder or having attached thereto a stock
power duly executed by the Shareholder in proper form for transfer.
2.4 Acceleration of the Put. Foodex, in its sole discretion, may accelerate
and pay the Put upon the occurrence of any sale of assets, merger or
reorganization of Foodex.
3. "Market Stand-Off" Agreement. In the event one-third or more of the
Shares then held by the Shareholder are included for sale to the public in an
underwritten public offering at a price of not less than $5.00 per share (as
adjusted pursuant to Section 6 below), the Shareholder shall not, to the extent
requested by Foodex and the underwriter of the common stock (or securities)
offered in the public offering, sell or otherwise transfer or dispose of any
Shares during a minimum of one hundred and eighty (180) days following the
effective date of a registration statement of Foodex filed under the Securities
Act, or such other longer period as may be required by the underwriters;
provided, however, that: such agreement shall be applicable only to the first
such registration statement of Foodex which covers shares (or securities) to be
sold on its behalf to the public in an underwritten offering agreements.
3.1 Enforcement. In order to enforce the foregoing covenant, Foodex may
impose stop-transfer instructions with respect to the Shares of the Shareholder
(and the shares or securities of every other person subject to the foregoing
restriction) until the end of such one hundred and eighty (180) day period or
such other longer period as may be required by the underwriters.
3.2 Suspension of the Put. Upon the occurrence of an underwritten public
offering of stock of Foodex (the "Public Offering"), at a per share purchase
price of not less than $5.00, the Shareholder will enter into a Market Stand-Off
Agreement as described in this Section 3. The right of the Shareholder to
exercise the Put shall be suspended for the one hundred and eighty (180) day
period described in the Market Stand-Off Agreement. Upon the termination of the
Market Stand-Off Agreement, the Shareholder's right to exercise the Put shall be
reinstated for a period of ninety (90) days after the termination of the Market
Stand-Off Agreement to the extent all of the Shares are not sold by the
Shareholder in the Public Offering.
4. Right of First Refusal.
4.1 For the period from November 1, 1997 to November 1, 1998, if the
Shareholder proposes to sell or engage in any transaction which has resulted in
or will result in a change in the beneficial or record ownership of any Shares
registered in the Shareholder's name or beneficially owned by such Shareholder,
including, but not limited to any sale, assignment, gift, hypothecation,
alienation or other disposition (including any involuntary transfer of the
Shares, or part of them, to a creditor) to any individual, entity, government,
government agency, political subdivision or unincorporated association (or is
required by operation of law or other involuntary transfer) (hereinafter,
"Transfer"), the Shareholder shall first offer such Shares to Foodex (the "Right
of First Refusal") in accordance with the following provisions:
(a) The Shareholder (the "Selling Shareholder") shall deliver a
written notice (a "Notice") to the secretary of Foodex stating the Selling
Shareholder's bona fide intention to Transfer such Shares, the name and address
of the person or firm to whom the Selling Shareholder intends to transfer the
Shares, or interest therein, the price or amount to be paid for the proposed
Transfer (including the amount of any debt to be paid, canceled or forgiven upon
foreclosure of a security interest in the Shares or upon any other Transfer to
the Selling Shareholder's creditors), specifying the number of Shares to be
transferred and all other material terms and conditions of the proposed
Transfer.
(b) If Foodex desires to purchase all or part of the Shares specified
in the Notice, Foodex or its designee (as the case may be) shall, within ten
(10) calendar days after receipt of the Notice, deliver to the Selling
Shareholder a written notice to purchase, specifying the number of Shares to be
purchased at a price of $5.00 per share (subject to adjustment pursuant to
Section 6 below) (the "Right of First Refusal Price") and the terms of payment.
Foodex shall pay the Selling Shareholder the purchase price for such Shares
within ten (10) calendar days of the delivery of the Notice to the Selling
Shareholder. Notwithstanding the foregoing, Foodex may elect to offset against
and deduct from any payment of the purchase price any indebtedness then owed by
the Selling Shareholder to Foodex.
(c) If Foodex or its designee elects not to purchase or obtain all of
the Shares designated in the Selling Shareholder's Notice, then the Selling
Shareholder may Transfer the Shares referred to in the Notice to the proposed
transferee on the terms set forth in the Notice, provided that such sale or
transfer is consummated within thirty (30) calendar days following the date of
delivery of the Transfer Notice to Foodex and, provided further, that such sale
is in accordance with all the terms and conditions hereof. No Transfer of the
Shares shall be made after the end of such thirty (30) calendar day period, nor
shall any change in the terms of the transfer be permitted, without delivery by
the Selling Shareholder to Foodex of a new Transfer Notice in compliance with
the requirements of this Section 4.
4.2 In the event that the Selling Shareholder Transfers the Shares owned by
such Selling Shareholder in accordance with the terms of this Agreement, such
Transfer shall be expressly conditioned upon the transferee agreeing in writing
to abide by the terms of this Shareholder's Agreement. Any proposed Transfer not
made in accordance with this Section 4 shall be null and void and Foodex shall
not authorize and instruct the transfer agent for the Shares to effect the
proposed Transfer. If any such Transfer of the Shares requires the consent of
any agency pursuant to the securities laws of any state, the time periods
specified herein shall be extended for such period as the necessary request for
consent to Transfer is pending before such agency. All parties agree to
cooperate in making such request for Transfer, and no Transfer shall be executed
without such consent if required by law.
5. Assignment of Rights. Foodex may assign its rights under Sections 2 and
4 hereof, to one or more persons or entities, who shall have the right to so
exercise such rights in his or its own name and for his or its own account.
6. Adjustment to Put Price and Right of First Refusal Price. In the event
Foodex at any time or from time to time shall declare or pay any dividend on the
common stock payable in common stock, or effect a subdivision or consolidation
of the outstanding shares of common stock into a greater or lesser number of
shares of common stock, then and in any such event, in the case of any such
dividend, immediately after the close of business on the record date for the
determination of holders of any class of securities entitled to receive such
dividend, or in the case of any such subdivision, at the close of business on
the date immediately prior to the date upon which such corporate action becomes
effective, the Put Price and Right of First Refusal Price shall be
proportionately adjusted. Additionally, if, from time to time during the term of
this Agreement: (i) there is any stock dividend, distribution or dividend of
cash or property, stock split, or other change in the character or amount of any
of the outstanding securities of Foodex; or (ii) there is any consolidation,
merger or sale of all, or substantially all, of the assets of Foodex; then in
such event, any and all new, substituted or additional securities, cash, or
other property to which the Shareholder is entitled by reason of his or her
ownership of the Shares shall be included in the word "Shares" for all purposes
with the same force and effect as the Shares presently subject to the Right of
First Refusal and other terms of this Agreement. The Put Price and Right of
First Refusal Price per share shall be appropriately adjusted.
7. Legends.
7.1 Securities Act Legend. Each certificate representing the Shares shall
also be endorsed with the following legend:
THE SHARES REPRESENTED BY THIS CERTIFICATE MAY BE TRANSFERRED
ONLY IN ACCORDANCE WITH THE TERMS OF A SHAREHOLDER'S AGREEMENT
BETWEEN THE COMPANY AND THE REGISTERED HOLDER OR HIS
PREDECESSOR IN INTEREST, A COPY OF WHICH IS ON FILE WITH THE
SECRETARY OF THE COMPANY. THE AGREEMENT MAY BE INSPECTED AT
THE PRINCIPAL OFFICE OF THE COMPANY DURING NORMAL BUSINESS
HOURS.
Such legend shall be removed by Foodex upon the termination in full of this
Agreement.
7.2 State Securities Laws Legends. Any certificate representing the Shares
shall also be endorsed with any legend or legends required by the securities
laws of the jurisdiction of residence of the Shareholder.
8. Restrictions on Transfer. The Shareholder shall not transfer, sell or
otherwise dispose of any Shares for the period of one year following January 1,
1997 (the "Restriction Period"). After the Restriction Period, the transfer,
sale or disposal of the Shares shall be subject to the provisions of Section 4
above.
9. Miscellaneous.
9.1 Governing Law. This Agreement shall be governed in all respects by the
laws of the State of California without application of principles of conflicts
of laws.
9.2 Survival. The representations, warranties, covenants and agreements
made herein shall survive the closing of the transactions contemplated hereby.
9.3 Successors and Assigns. Except as otherwise expressly provided herein,
the provisions hereof shall inure to the benefit of, and be binding upon, the
successors, assigns, heirs, executors and administrators of the parties hereto.
9.4 Entire Agreement; Amendment.
(a) This Agreement and the other documents delivered pursuant hereto
constitute the full and entire understanding and agreement between the parties
with regard to the subjects hereof and thereof. Any term of this Agreement may
be amended and the observance of any term of this Agreement may be waived
(either generally or in a particular instance and either retroactively or
prospectively), only with the written consent of the parties hereto.
(b) Any amendment or waiver effected in accordance with this Section
shall be binding upon each holder of any securities purchased under this
Agreement at the time outstanding, each future holder of all such securities,
and Foodex.
9.5 Notices, etc. All notices and other communications required or
permitted hereunder shall be in writing and shall be (i) delivered personally,
(ii) transmitted by first-class mail, postage prepaid, or airmail, postage
prepaid, in the event of mailing for delivery outside of the country in which
mailed, (iii) transmitted by an overnight courier of recognized reputation or of
recognized international reputation in the event of an international delivery,
or (iv) transmitted by telecopier (with confirmation by airmail or courier),
addressed (a) if to a Shareholder, at such Shareholder's address as the
Shareholder shall have furnished to Foodex by ten (10) calendar day's prior
notice in writing, or (b) if to any other holder of any Shares, at such address
as such holder shall have furnished to Foodex in writing, or, until any such
holder so furnishes an address to Foodex then to and at the address of the last
holder of such Shares who has so furnished an address to Foodex, or (c) if to
Foodex, at its address set forth at the signature page of this Agreement, or at
such other address as Foodex shall have furnished to each such holder in
writing. Except as otherwise specified herein, all notices and other
communications shall be deemed to have been duly given on (A) the date of
receipt if delivered personally, (B) the date seven (7) days after posting if
transmitted by mail, (C) the date three (3) days after delivery to the courier
if sent by recognized or internationally recognized courier service, or (D) the
date on which written confirmation would be deemed to have been given as
provided above, whether by mail or by courier, as applicable, if transmitted by
telecopier, whichever shall first occur.
9.6 Separability of this Agreement. In case any provision of this Agreement
shall be invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions shall not in any way be affected or
impaired thereby.
9.7 Titles and Subtitles. The titles of the paragraphs and subparagraphs of
this Agreement are for convenience of reference only and are not to be
considered in construing this Agreement.
9.8 Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be an original, but all of which together
shall constitute one instrument.
IN WITNESS WHEREOF, the parties have entered into this Agreement as of the
day and year first written above.
FOOD EXTRUSION, INC.
By:/s/ X.X. XxXxxx
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Name: Xxxxxx X. XxXxxx
Title: Chief Executive Officer
SHAREHOLDER:
CF CORPORATION
By: /s/ Xxx Xxxxx
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Name: Xxx Xxxxx
Title: President and
Chief Executive Officer
