STOCKHOLDERS AGREEMENT
Exhibit 10.21
This Stockholders’ Agreement (“Agreement”) dated as of May 24, 2000, is by and between Xxxxx X. Xxxxx (“Xxxxx”) and Xxxxxx X. Xxxx (“Xxxx”).
Whereas, Xxxx has contributed substantial benefits to Xxxxx, and Xxxxx has agreed to provide Xxxx with certain protection from dilution of Xxxx’x interest in Heeling, Inc., a Nevada corporation (the “Corporation”);
Whereas, Xxxxx and Xxxx desire to provide for the non-dilution of the one percent (1%), fully diluted ownership interest that Xxxx’x 10,000 shares of the common stock of the Corporation initially represents in the Corporation;
NOW, THEREFORE, in consideration of the premises, the agreements set forth below, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:
1. Dilution Protection Covenant. On the terms and conditions set forth herein, Xxxxx agrees to cause Xxxx’x ownership interest in the common stock of the Corporation (“Common Stock”) to continue, at all times, to constitute one percent (1%), on a fully diluted basis. To satisfy this obligation, Xxxxx agrees to do the following:
a. At closing, when Xxxx is issued 10,000 shares of the Common Stock and Xxxxx is issued 290,007 shares of the Common Stock, Xxxxx agrees to have the following legend placed on 205,035 of Xxxxx shares of the common stock of the Corporation and all shares of Common Stock subsequently obtained by Xxxxx after closing representing or issued in respect of the initial 205,035 shares covered hereby, and any securities issued in exchange therefor (collectively, the “Legended Shares”):
THE TRANSFER OF THE SHARES EVIDENCED BY THIS CERTIFICATE ARE SUBJECT TO A STOCKHOLDERS AGREEMENT DATED AS OF MAY 24, 2000. THE SHARES EVIDENCED HEREBY SHALL NOT BE TRANSFERRED WITHOUT THE PRIOR WRITTEN CONSENT OF XXXXXX X. XXXX. ANY CERTIFICATES HEREAFTER ISSUED IN RESPECT OF THE SHARES EVIDENCED HEREBY SHALL CONTINUE TO BEAR THIS LEGEND UNLESS OTHERWISE SPECIFIED BY XXXXXX X. XXXX OR HIS HEIRS IN A LETTER DIRECTED TO THE CORPORATION.
x. Xxxxx agrees to instruct the Corporation to issue all certificates representing any of the Legended Shares to bear the above-referenced legend and not to transfer any of the Legended Shares without the prior written consent of Xxxx, which Xxxx agrees to give for arm’s-length transactions for value with unaffiliated third parties so long as, after giving effect to such transfer, Xxxxx continues to hold at least twenty-five
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percent (25%) of the Legended Shares, which untransferred shares continue to be evidenced by certificates bearing the legend set forth in this Section 1, while the transferred shares shall not bear the legend set forth in this Section 1.
x. Xxxxx agrees that he shall transfer the necessary amount of Legended Shares to Xxxx to the extent necessary to cause Xxxx to own one percent (1%) of Corporation’s Common Stock on a fully diluted basis within ten (10) days after a dilutive transaction occurs. Xxxxx agrees further to, and hereby does, instruct the Corporation, upon delivery of any certificate evidencing Legended Shares held of record by Xxxxx, to transfer shares from Xxxxx to Xxxx to comply with the anti-dilution provisions of this Agreement when so instructed by Xxxx and to record said transfers in the Corporation’s share register. Xxxxx and Xxxx agree to take any and all further actions necessary to effectuate the terms of this Agreement, including the giving of notices and instructions to the Corporation, in conformity with this Agreement.
x. Xxxxx’ obligation under this Section 1 shall cease and terminate at such time as the Legended Shares have been reduced by dilutive transactions to seventy-five (75%) of the original number of Legended Shares, after taking into account any securities issued in exchange therefor, provided that Xxxxx shall have complied with all of his transfer obligations hereunder. For purposes of this paragraph d., dilutive transactions ("Dilutive Transactions") shall mean stock issuances. Xxxxx will instruct the Corporation not to engage in any transaction that would defeat the purpose and intent of this Agreement.
e. Dilutive Transactions shall not include stock issuances by the Corporation for (i) common stock issued pursuant to exercise of 90,900 stock options; and (ii) the conversion of the Series B Preferred Stock issued to CSVC (defined below) and the Xxxxxx (defined below) on May 26, 2000.
f. This Agreement creates an interest in property of Xxxxx in favor of Xxxx and is not an executory contractor for purposes of the U.S. Bankruptcy Code and any other insolvency law. In furtherance thereof, Xxxxx agrees that, upon request of Xxxx, Xxxxx shall deliver all certificates to Xxxx evidencing Legended Shares, unendorsed, for Xxxx to hold with the status of secured creditor.
x. Xxxxx and Xxxx acknowledge and agree that Xxxxx is pledging shares of Common Stock to Capital Southwest Venture Corporation (“CSVC”) and Xxxxxx X. and Xxxxxxxx X. Xxxxx (the “Xxxxxx”) to secure the Corporation’s obligations to CSVC and the Xxxxxx. The pledged shares of Xxxxx shall not bear the legend set forth above and may not be used to satisfy Xxxxx' obligations hereunder. CSVC and the Xxxxxx shall be third party beneficiaries of this Agreement entitled to enforce the provisions of this Agreement.
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2. Notices. Any notices or other communications required or permitted hereunder or otherwise in connection herewith shall be in writing and shall be deemed to have been duly given when delivered in person or transmitted by facsimile transmission or five business days after dispatch by registered or certified mail, postage prepaid, addressed, as follows:
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Xxxxx X. Xxxxx |
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0000 Xxxx Xxxxx Xxxxxxx |
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Xxxxx, Xxxxx 00000 |
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Facsimile: 972.985.1256 |
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If to Xxxxxx X. Xxxx: |
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Xxxxxx J, Xxxx |
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0000 Xxxxx Xxxxxx, 00xx Xxxxx |
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Xxxxxx, Xxxxx 00000 |
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Facsimile: 214.880.0011 |
or such other address as the person to whom notice is to be given has furnished in writing to the other parties.
3. Amendment. This Agreement may be amended by the parties hereto at any time. This Agreement may not be amended except by an instrument in writing signed by the parties hereto.
4. Assignment. Either party hereto may assign his rights or obligations, in whole or in part, under this Agreement, provided that the party making such assignment shall give notice to the other party within seven (7) days after such assignment is effected, giving the name and address of the assignee, and such assignee shall agree in writing to be fully bound by all of the obligations of this Agreement. This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors, representatives and assigns.
5. Headings. The descriptive headings of the several Sections of this Agreement are inserted for convenience only and do not constitute a part of this Agreement.
6. Applicable Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Texas regardless of the laws that might otherwise govern under applicable principles of conflict of laws thereof and shall be performable in Dallas County, Texas,
7. Entire Agreement. This Agreement (including the documents and instruments referred to herein) (a) constitutes the entire agreement and supersedes all other prior agreements and
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understandings, both written and oral, among the parties and (b) is not intended to confer upon any person other than the parties hereto any rights or remedies hereunder,
8. Counterparts. This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. Facsimile signatures shall be deemed original signatures for the purposes of enforcing this Agreement.
9. Severability. In the event that any one or more of the provisions or parts of a provision contained in this Agreement shall for any reason be held to be invalid, illegal or unenforceable in any respect in any jurisdiction, such invalidity, illegality or unenforceability shall not affect any other provision or part of a provision of this Agreement or any other jurisdiction, but this Agreement shall be reformed and construed in any such jurisdiction as if such invalid or illegal or unenforceable provision or part of a provision had never been contained herein and such provision or part shall be reformed so that it would be valid, legal and enforceable to the maximum extent permitted in such jurisdiction.
10. Gender. All references to a gender shall be deemed to include a reference to all genders, and all references to the singular shall be deemed to include a reference to the plural and vice versa.
11. Acknowledgment. Xxxxx and Xxxx agree and acknowledge that they are entering into this Agreement of their own free will and each has had an opportunity to carefully review and consider this Agreement, along with the opportunity to seek and consult with independent legal counsel.
12, Construction. Xxxxx and Xxxx agree that this Agreement shall not be strictly construed against any party.
13. Equitable Relief. The parties hereto acknowledge and agree that a breach of the agreements contained herein will cause irreparable harm to the other party for which a remedy for damage will be inadequate. Therefore, each party agrees that injunctive relief is a necessary and appropriate remedy for breach hereof.
IN WITNESS WHEREOF, the parties have duly executed this Agreement as of the day and year first above written.
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/s/ Roer X. Xxxxx |
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Xxxxx X. Xxxxx |
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/s/ Xxxxxx X. Xxxx |
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Xxxxxx X. Xxxx |
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