EXHIBIT 9
XXXXXXXXXX INTERNATIONAL STOCKHOLDERS AGREEMENT
THIS XXXXXXXXXX INTERNATIONAL STOCKHOLDERS AGREEMENT ("Agreement") is
made effective as of ___________, 199_ by and among XXXXXXXXXX INTERNATIONAL,
INC., a Texas corporation, formerly known as ICO, Inc. (the "Corporation"), and
each of the holders of common stock, no par value, of the Corporation
("Corporation Common Stock") set forth on the signature pages hereof, in their
capacity as a stockholder as set forth herein (such holders collectively, the
"Stockholders"; individually, a "Stockholder").
R E C I T A L S:
WHEREAS, in furtherance of the transactions contemplated by the Merger
Agreement dated as of December ___, 1995 (the "Merger Agreement") by and among
the Corporation, W Acquisition Corp., a New Jersey corporation, and Wedco
Technology, Inc., a New Jersey corporation ("Wedco"), the parties hereto desire
to provide, through grants of irrevocable proxies, for the orderly disposition
of certain matters involving the Corporation's internal affairs and also for the
representation of the W-F Group (as defined hereinafter) on the Board of
Directors of the Corporation; and
WHEREAS, the parties desire to provide members of the W-F Group certain
authority with respect to the on going management of the Surviving Corporation
(as defined hereinafter).
NOW, THEREFORE, in consideration of the premises and the mutual
covenants and agreements contained hereinafter, the parties hereto hereby agree
as follows:
1. DEFINITIONS. As used in this Agreement, the following terms shall
have the meanings indicated below:
(a) "W-F Group" shall mean Xxxxxxx X. Xxxxxxxxxx, Xxxxx X. Xxxxxxxxxx,
Xxxxxxx X. Xxxxxxxxxx, Xxxxxx X. Xxxxxxxxxx, Xxxx X. Xxxxx, Xxxx J.M.L.
Verhoeff, Xxxxxxxxx Xxxxxxxxxx Xxxxxxx, Xxxxxxx X. Xxxxxxxxxx, as custodian for
Xxxxxxx X. Xxxxxxxxxx, and Xxxxxx X. Xxxxxxxxxx, as custodian for Xxxxxxx X.
Xxxxxxxxxx.
(b) "P Group" shall mean Pacholder Associates, Inc. and its
Subsidiaries, Xxxxxx X. Xxxxxxxxx, Xx. Xxxxx X. Xxxxxxxxx, Xxxxx X. Xxxxxxxxx
and Xxxxxxx X. Xxxxxx.
(c) "Change in Control of the Corporation" shall mean the occurrence
of any of the following:
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(i) any "person" (as defined in Section 13(d) of the
Securities Exchange Act of 1934, as amended (the "1934 Act")) or
"group" (as defined in Section 13(d)(3) of the 0000 Xxx) of
"persons" becomes the "beneficial owner" (as defined in Rule 13d-
3 promulgated under the 0000 Xxx) of shares of stock or other
securities of the Corporation either (i) constituting in excess
of 50% of the shares of voting stock of the Corporation, or (ii)
entitling such "person," either immediately or with the passage
of time or the occurrence of a stated event, to exercise a
majority of the voting power in the election of directors of the
Corporation; or
(ii) a majority of the Board of Directors of the
Corporation ceases to be composed of the nominees of the
Stockholders (the "Continuing Directors") or of persons nominated
by and elected to the Board of Directors of the Corporation with
the consent or approval of a majority of the Continuing
Directors; or
(iii) a sale, transfer, conveyance, assignment or other
disposition by the Corporation of all or substantially all its
assets, whether in liquidation, dissolution or otherwise.
(d) "Initial W-F Group Board Representatives" shall mean the three (3)
persons, viz, Xxxxxxx X. Xxxxxxxxxx, Xxxxxx X. Xxxx and Xxxxxx X. Sirusus,
designated by Wedco to represent the interests of the W-F Group on the Board of
Directors of the Corporation immediately after the Effective Time.
(e) "Successor W-F Group Board Representatives" shall mean the W-F
Group Board Representatives succeeding to the offices of the Initial W-F Group
Board Representatives.
(f) "W-F Group Board Representatives" shall mean the Initial W-F Group
Board Representatives and the Successor W-F Group Board Representatives,
collectively.
(g) Capitalized terms used in this Agreement without specific
definition shall have the meanings respectively ascribed thereto in the Merger
Agreement.
2. INITIAL BOARD REPRESENTATION OF THE W-F GROUP.
(a) The W-F Group hereby confirms the designation of Xxxxxxx X.
Xxxxxxxxxx, Xxxxxx X. Xxxx and Xxxxxx X. Sirusus as the Initial W-F Group Board
Representatives and acknowledges that the Initial W-F Group Board
Representatives shall constitute three (3) members of a nine (9) member
classified Board of Directors.
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(b) The Stockholders hereby covenant to take (or to cause to be taken)
all actions necessary or appropriate to cause the election or other designation
of the Initial W-F Group Board Representatives as members of the Corporation's
Board of Directors for terms beginning immediately after the Effective Time and
ending, respectively, on the date of the Corporation's annual stockholders
meeting in 1996 (Xxxxxxx X. Xxxxxxxxxx), the date of the Corporation's annual
stockholder's meeting in 1997 (Xxxxxx X. Xxxx) and the date of the Corporation's
annual stockholders meeting in 1998 (Xxxxxx X. Sirusus). Irrespective of the
amount of Corporation Common Stock held by the W-F Group, the Stockholders
further covenant that they shall take (or cause to be taken) all actions
necessary or appropriate to renominate and re-elect Xxxxxxx X. Xxxxxxxxxx and
Xxxxxx X. Xxxx for additional three (3) year terms as members of the
Corporation's Board of Directors when their initial terms expire, respectively,
on the date of the Corporation's annual stockholders meeting in 1996 (Xxxxxxx X.
Xxxxxxxxxx) and 1997 (Xxxxxx X. Xxxx). For all purposes of this Agreement, the
service of Xxxxxxx X. Xxxxxxxxxx and Xxxxxx X. Xxxx as members of the
Corporation's Board of Directors for the additional three (3) year terms
described in the immediately preceding sentence shall be deemed to constitute
service as an Initial W-F Group Board Representative.
3. CONTINUED BOARD REPRESENTATION OF THE W-F GROUP. The P Group hereby
covenants that, until the earlier of: (i) the time that the W-F Group, taken as
a whole, beneficially owns (as defined in Rule 13d-3 promulgated under the 0000
Xxx) less than 1,500,000 shares ("Minimum Share Level") of issued and
outstanding Corporation Common Stock; provided, however, if and whenever the
outstanding shares of Corporation Common Stock shall be combined by reverse
stock split or similar transaction into a smaller number of shares of
Corporation Common Stock, the Minimum Share Level shall be proportionately
reduced, such reduction to become effective immediately on the day upon which
such combination becomes effective; or (ii) there is a Change in Control of the
Corporation, they shall (in conjunction with the W-F Group) take (or cause to be
taken) any and all actions necessary or appropriate to have the W-F Group's
interests represented on the Corporation's Board of Directors by the Initial W-F
Group Board Representatives as and after the respective terms of service of the
Initial W-F Group Board Representatives expire.
4. VACANCIES, ETC. If any of the Initial W-F Group Board Representatives
shall cease to serve as a member of the Corporation's Board of Directors or if,
at any time when the P Group is obligated under Section 3 above to ensure W-F
Group representation on the Board of Directors through W-F Group Board
Representatives, an Initial or Successor W-F Group Board Representative shall
cease to serve as a member of the Corporation's Board of Directors, the
Stockholders shall take (or cause to be taken) any and all actions necessary or
appropriate to ensure that the vacancy created by the non-serving W-F Group
Board Representative shall be filled by a person nominated by the remaining W-F
Group Board Representatives or, if there shall be only one remaining W-F Group
Board Representative, then that representative, subject
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to the consent of a majority of the full Board of Directors, such consent not to
be unreasonably withheld and, provided, such consent shall not be deemed to have
been unreasonably withheld to the extent necessary to act in accordance with the
fiduciary duties of such Board of Directors under applicable laws (as determined
by such Board of Directors in good faith after consultation with and based upon
advice of counsel). However, if there are no remaining W-F Group Board
Representatives the vacancy (or vacancies) shall be filled in accordance with
the directions of the W-F Group acting by a majority in interest (as to
beneficial ownership of Corporation Common Stock), subject to the consent of a
majority of the full Board of Directors as set forth above herein. If the
consent by a majority of the full Board of Directors in accordance with Sections
3 or 4 hereof is not obtained, the failure to obtain such consent shall not
affect the rights of the then-incumbent W-F Group Board Representatives or W-F
Group, as the case may be, to designate additional person(s) to serve as W-F
Group Board Representatives in accordance with the terms hereof.
5. GRANTS OF PROXY.
(a) EFFECTIVE DURING THE TERMS OF THE INITIAL W-F GROUP BOARD
REPRESENTATIVES AND DURING THE PERIOD IN WHICH THE P GROUP IS OBLIGATED TO
ENSURE W-F GROUP REPRESENTATION ON THE BOARD OF DIRECTORS THROUGH W-F GROUP
BOARD REPRESENTATIVES (THE "P GROUP PROXY PERIOD"), EACH MEMBER OF THE P GROUP
HEREBY IRREVOCABLY GRANTS TO AND APPOINTS, XXXXXX X. XXXX AND XXXXXX X. XXXXX,
OR ANY ONE (1) OF THEM, SUCH STOCKHOLDER'S PROXY AND ATTORNEY-IN-FACT (WITH FULL
POWER OF SUBSTITUTION) FOR AND IN THE NAME, PLACE AND STEAD OF SUCH STOCKHOLDER,
TO VOTE SUCH STOCKHOLDER'S SHARES OF CORPORATION COMMON STOCK, OR GRANT CONSENTS
IN RESPECT OF SUCH SHARES OF CORPORATION COMMON STOCK, IN FAVOR OF THE SLATE OF
NOMINEES FOR THE CORPORATION'S BOARD OF DIRECTORS SELECTED BY THE THEN-INCUMBENT
MEMBERS OF THE CORPORATION'S BOARD OF DIRECTORS (THE "NOMINATED SLATE"). EACH
SUCH MEMBER OF THE P GROUP AFFIRMS THAT THIS IRREVOCABLE PROXY IS COUPLED WITH
AN INTEREST AND MAY UNDER NO CIRCUMSTANCES BE REVOKED DURING THE P GROUP PROXY
PERIOD. SUCH IRREVOCABLE PROXY IS EXECUTED AND INTENDED TO BE IRREVOCABLE IN
ACCORDANCE WITH THE PROVISIONS OF ARTICLE 2.29 OF THE TEXAS BUSINESS CORPORATION
ACT (THE "TEXAS ACT").
(b) EFFECTIVE WHILE ANY W-F GROUP MEMBERS OWNS CORPORATION COMMON
STOCK AND UNTIL THERE SHALL HAVE OCCURRED A CHANGE IN CONTROL OF THE CORPORATION
(THE "W-F GROUP PROXY
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PERIOD"), EACH MEMBER OF THE W-F GROUP HEREBY IRREVOCABLY GRANTS TO, AND
APPOINTS, XXXXXX X. XXXXXXXXX AND XX. XXXXX X. XXXXXXXXX, OR ANY ONE (1) OF
THEM, SUCH STOCKHOLDER'S PROXY AND ATTORNEY-IN-FACT (WITH FULL POWER OF
SUBSTITUTION) FOR AND IN THE NAME, PLACE AND STEAD OF SUCH STOCKHOLDER, TO VOTE
SUCH STOCKHOLDER'S SHARES OF CORPORATION COMMON STOCK, OR GRANT CONSENTS IN
RESPECT OF SUCH SHARES OF CORPORATION COMMON STOCK, IN FAVOR OF THE NOMINATED
SLATE. EACH SUCH MEMBER OF THE W-F GROUP AFFIRMS THAT THIS IRREVOCABLE PROXY IS
COUPLED WITH AN INTEREST AND MAY UNDER NO CIRCUMSTANCES BE REVOKED DURING THE W-
F GROUP PROXY PERIOD. SUCH IRREVOCABLE PROXY IS EXECUTED AND INTENDED TO BE
IRREVOCABLE IN ACCORDANCE WITH ARTICLE 2.29 OF THE TEXAS ACT.
6. DIRECTORS AND OFFICERS OF THE SURVIVING CORPORATION. Xxxxxx X.
Xxxxxxxxx shall be President and Chief Executive Officer ("CEO") of the
corporation surviving the merger of Wedco with and into W Acquisition and any
successor through which the merged corporation operates its business in the
United States (the "Surviving Corporation") from and after the Effective Time.
Xx. Xxxxx O. Pacholder shall be Chairman of the Board and Chief Operating
Officer ("COO") of the Surviving Corporation from and after the Effective Time.
The Articles of Incorporation of the Surviving Corporation shall
provide that: the President, Chairman of the Board, CEO, COO, or any person who
shall hold any other office, position or title having similar functions or
authority to the functions of Chairman of the Board, CEO, President or COO, or
who shall have equivalent operating authority of the Surviving Corporation,
shall be elected by a unanimous vote of the Board of the Surviving Corporation.
The Corporation (Xxxxxxxxxx International, Inc.) hereby agrees to
elect as a Director of the Surviving Corporation (as defined in this Section)
Xxxxxxx X. Xxxxxxxxxx and if Xxxxxxx X. Xxxxxxxxxx shall be unable or shall, for
any reason, cease to serve, the Corporation shall elect Xxxxxx X. Xxxx, Esquire,
as Director. In the event that Xxxxxx X. Xxxx shall be unable or shall cease
for any reason to act as a Director, the Corporation shall elect Xxxxxx X.
Xxxxx, Esquire, to act as Director of the Surviving Corporation. If Xxxxxx X.
Xxxxx, Esquire, shall be unable or shall cease for any reason to act as a
Director, then the Corporation shall elect as a Director of the Surviving
Corporation such person as is nominated by the W-F Group Representatives on the
Board of Directors of the Corporation.
It is the intent of the parties to this Agreement, in consideration of
this Agreement and of the Merger Agreement, with the exception of the election
of Xx. Xxxxx X. Xxxxxxxxx and Xxxxxx X. Xxxxxxxxx any person holding the office
or title of President, CEO, Chairman, COO, or who shall hold any other office,
position or title having similar functions or authority to the
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functions of Chairman of the Board, CEO, President or COO, or who shall have
equivalent operating authority of the Surviving Corporation or Wedco, Inc. (or
any successor through which the Surviving Corporation operates its business in
the United States), will not be elected without the approval of the W-F Group
Board Representative.
7. RESTRICTION ON BLOCK TRANSFERS OF W-F GROUP AND P GROUP SHARES OF
CORPORATION COMMON STOCK. Except as expressly set forth in this Section 7,
nothing in this Agreement shall be deemed to constitute a restriction on the
right, power or authority of any member of the W-F Group or P Group, as the case
may be, to sell, convey or otherwise transfer, after the Effective Time, any
shares of Corporation Common Stock owned by him, her or it. However, if any one
(1) or more members of the W-F Group or P Group, as the case may be, desire to
sell, convey or otherwise transfer Five Hundred Thousand (500,000) or more
shares of Corporation Common Stock to any person (as defined in Section 13(d) of
the Securities Exchange Act of 1934, as amended (the "1934 Act")) or group of
persons (as defined in Rule 13d-5 promulgated under the 1934 Act), other than to
an underwriter or underwriter group in connection with an underwritten public
offering that would not result in a transfer or transfers of Five Hundred
Thousand (500,000) or more shares of Corporation Common Stock, to any person (as
defined in Section 13(d) of the 0000 Xxx) or group of persons (as defined in
Rule 13d-5 promulgated under the 1934 Act), in a single transaction or series of
related transactions, such proposed sale, conveyance or other transfer shall not
be effective, and the Corporation shall have no obligation to register the
transfer of such shares of Corporation Common Stock unless and until the
proposed vendee or transferee agrees to be bound as regards the obligations (but
not the rights) of a W-F Group member or P Group member, as the case may be, by
this Agreement as though an original member of the W-F Group or P Group, as the
case may be. The members of the W-F Group and P Group (and each of them) agree
that the foregoing limited restriction on transfer is necessary to achieve the
purposes of this Agreement and that the other Stockholders and the Corporation
shall be entitled to obtain injunctive relief (including, without limitation, a
permanent mandatory injunction) and specific performance in the event of a
breach or threatened breach of the foregoing limited restriction on transfer.
The certificates evidencing the shares of Corporation Common Stock held by the
members of the W-F Group and P Group shall bear a legend referring to the
provisions of this Section 7. Notwithstanding the foregoing, the restrictions
set forth above shall not apply to transfers of Corporation Common Stock by the
holders of partnership interests of P M Special Fund, Limited Partnership and O
P Limited Partnership upon the termination or expiration of such partnerships in
accordance with the terms of their respective partnership agreements.
8. ENDORSEMENT ON STOCK CERTIFICATES. It is understood that all of the
Certificates representing shares of Corporation Common Stock owned by the W-F
Group or the P Group will be endorsed as follows:
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"THE SHARES REPRESENTED BY THIS CERTIFICATE MAY NOT BE
TRANSFERRED UNLESS EITHER A REGISTRATION STATEMENT WITH
RESPECT THERETO IS IN EFFECT UNDER THE SECURITIES ACT OF 1933
OR, IN THE OPINION OF THE CORPORATION'S COUNSEL, AN EXEMPTION
FROM THE REGISTRATION PROVISIONS OF SAID ACT IS THEN AVAILABLE
UNDER SAID ACT OR ANY RULE OR REGULATION OF THE SECURITIES AND
EXCHANGE COMMISSION THEREUNDER OR SIMILAR ENDORSEMENT."
The removal of such endorsement requires the opinion of
counsel of the Corporation. Any transfer which comes to the attention of counsel
for the Corporation which shall reasonably appear to be in violation of Section
7 hereof may be held up by said counsel provided said counsel shall, by the end
of the next business day after the receipt of the request for an opinion for the
transfer of the shares, contract the transferor questioning whether the transfer
of the Corporation Common Stock is in violation of Section 7 and said counsel
shall give to the transferor the basis upon which said counsel shall reasonably
believe that the transfer is in violation of Section 7 hereof. The transferor of
the shares of Corporation Common Stock shall advise said counsel whether, to the
best of transferor's knowledge, taking into consideration the information given
by counsel to the transferor, said transfer is in violation of Section 7 and if
it is not, said transferor will forward to said counsel a letter which shall
include the following:
"The transfer of the shares of Xxxxxxxxxx International, Inc.
Common Stock being made by me and subject to your inquiry of
[date] are not, to the best of my knowledge, taking into
consideration facts supplied by you in the said inquiry, being
transferred in violation of Section 7 of the Xxxxxxxxxx
International Stockholders Agreement dated the _____ day of
______________, 1995.
"It is understood that the transfer is being approved in
reliance upon this statement.
____________________________________
Transferor"
The receipt of such statement by corporate counsel shall constitute
conclusive evidence to the said corporate counsel that the transfer is not in
violation of Section 7 hereof and
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said corporate counsel shall, without further delay, give the opinion required
for the transfer of the shares. Until such time as corporate counsel receives
the foregoing statement signed by the transferor, corporate counsel may deem
that the shares are in violation of Section 7 and corporate counsel shall not be
required to complete the transfer.
The parties subject to Section 7 shall keep corporate counsel advised
of their address and facsimile numbers so that all inquiries to be made
hereunder may be made quickly. All inquiries and responses shall be made by
either facsimile or overnight private couriers. It is the intention hereof that
there shall be no unreasonable delay in the transfer of the said shares of
Corporation Common Stock if the said transfer is not in violation of Section 7.
Counsel for the Corporation shall not question transfers of 100,000 shares or
less unless the same appears to be part of a series which could reasonably be
believed to be in violation of Section 7 hereof.
9. SPECIFIC PERFORMANCE. The parties hereto agree that if any of the
provisions of this Agreement were not performed in accordance with their
specific terms or were otherwise breached, irreparable damage would occur, no
adequate remedy at law would exist and damages would be difficult to determine,
and that the parties shall be entitled to specific performance of the terms
thereof, in addition to any other remedy at law or equity.
10. SEVERABILITY. If any term or other provision of this Agreement is
invalid, illegal or incapable of being enforced by any rule of law, or public
policy, and as a result thereof, the economic or legal substance of this
Agreement is affected in a manner materially adverse to a party hereto, the
materially adversely affected party may terminate this Agreement upon notice to
the other parties hereto. Upon a determination that any term or other provision
is invalid, illegal or incapable of being enforced, and, as a result thereof,
the economic or legal substance of this Agreement is not affected in a manner
materially adverse to a party hereto, the parties hereto shall negotiate in good
faith to modify this Agreement so as to effect the original intent of the
parties in order that the terms of this Agreement remain as originally
contemplated to the fullest extent possible.
11. MISCELLANEOUS. This Agreement shall be construed under and governed
by the internal substantive laws of the State of Texas applicable to contracts
negotiated, executed and wholly performed within the State of Texas except for
matters pertaining to Section 6 hereof, to which the laws of the State of New
Jersey shall be applicable in the same manner as contracts negotiated, executed
and wholly performed within the State of New Jersey. This Agreement may not be
amended or modified without the prior written consent of all the parties hereto.
If any court or other tribunal of competent jurisdiction should find any
provision of this Agreement to be unenforceable, said court or other tribunal
shall sever the unenforceable provision and enforce the remaining provisions as
originally executed and delivered.
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12. COUNTERPARTS. This Agreement may be executed in two or more
counterparts, all of which shall be considered one and the same agreement and
shall become effective as to any Stockholder when one or more counterparts have
been signed by each of the Corporation and such Stockholder and delivered to the
Corporation and such Stockholder.
13. INTERPRETATION. The descriptive headings contained herein are for
convenience of reference only and shall not affect in any way the meaning or
interpretation of this Agreement.
14. LEGAL OPINION. Prior to or simultaneous with the execution of this
Agreement, the Stockholders and the Corporation shall have received an opinion
from Xxxxxx & Xxxxxx in form and substance reasonably satisfactory to them,
substantially to the effect that, this Agreement creates legal, valid and
binding obligations of the parties hereto and is enforceable in accordance with
its terms under the laws of the State of Texas.
15. TERMINATION. This Agreement shall terminate: (i) with the consent of
the Corporation and the Stockholders party to this Agreement; or (ii) upon the
occurrence of an event described in Section 3(i) or (ii).
IN WITNESS WHEREOF, the undersigned have hereunto set their respective
hands effective as of the date and year first above written.
XXXXXXXXXX INTERNATIONAL, INC.
By:________________________________
Name:
Title:
THE STOCKHOLDERS:
________________________________________
XXXXXXX X. XXXXXXXXXX
________________________________________
XXXXX X. XXXXXXXXXX
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________________________________________
XXXXXXX X. XXXXXXXXXX
________________________________________
XXXXXX X. XXXXXXXXXX
________________________________________
XXXX X. XXXXX
________________________________________
THEO J.M.L. VERHOEFF
________________________________________
XXXXXXX X. XXXXXXXXXX, AS
CUSTODIAN FOR XXXXXXX X.
XXXXXXXXXX
________________________________________
XXXXXX X. XXXXXXXXXX, AS
CUSTODIAN FOR XXXXXXX X.
XXXXXXXXXX
________________________________________
XXXXXXXXX XXXXXXXXXX XXXXXXX
________________________________________
XXXXXX X. XXXXXXXXX
________________________________________
XX. XXXXX X. XXXXXXXXX
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________________________________________
XXXXX X. XXXXXXXXX
________________________________________
XXXXXXX X. XXXXXX
PACHOLDER ASSOCIATES, INC.
By:_____________________________________
Its:____________________________________
P M DELAWARE, INC.
By:_____________________________________
Its:____________________________________
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