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EXHIBIT 4.4
AMENDED AND RESTATED STOCKHOLDERS AGREEMENT
OF HANOVER COMPRESSOR COMPANY
AMENDED AND RESTATED STOCKHOLDERS AGREEMENT (this "Agreement") dated
as of August 7, 1995, among Hanover Compressor Company, a Delaware corporation
(the "Company"), and the other parties signatories hereto under the heading
"Stockholders."
W I T N E S S E T H:
WHEREAS, the Company is authorized to issue 500,000 shares of common
stock, $.001 par value ("Common Stock") and 200,000 shares of preferred stock,
$.01 par value ("Preferred Stock");
WHEREAS, as of the date hereof the Company is a party to the following
Stockholders' Agreements (i) that certain 1993 Stockholders' Agreement of
Hanover Compressor Company, among the Company, GKH and certain employee-
stockholders of the Company, dated as of June 30, 1993, (ii) that certain
Supplemental Stockholders' Agreement of Hanover Compressor Company, among the
Company, GKH and Xxxxx Investment Group, an Arkansas general partnership, dated
as of October 8, 1993, (iii) that certain Supplemental Stockholders' Agreement
of Hanover Compressor Company, among the Company, GKH and certain former
stockholders of Xxxx Force Compression Services, Inc., dated as of March 8,
1995, (iv) that certain Supplemental Stockholders' Agreement of Hanover
Compressor Company, among the Company, GKH and certain employee-stockholders of
the Company, dated as of July 7, 1995 and (v) that certain Supplemental
Stockholders' Agreement of Hanover Compressor Company, among the Company, GKH
and Xxxxxx X. Xxxxxxxx, dated as of November 19, 1993 (collectively, the "Prior
Stockholders' Agreements");
WHEREAS, the Company and the other parties to the Prior Stockholders'
Agreements agree that it is in their mutual best interests to amend and restate
the Prior Stockholders' Agreements in their entirety;
WHEREAS, pursuant to the terms of those certain Subscription
Agreements dated as of August 7, 1995, between the Company and each of the
subscribers to the Company's private placement of Common Stock it is a
condition precedent to the issuance and delivery of the shares of Common Stock
that the subscribers therefor execute and deliver a counterpart of this
Agreement;
WHEREAS, the Company has authorized the 6.5% Cumulative Redeemable
Series A Preferred Stock, par value $.01 per share (the "Series A Preferred
Stock"), which Series A Preferred Stock will upon original issuance be issued
together with detachable warrants, par value $.001 per warrant (the
"Warrants"), to purchase shares of Common Stock;
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WHEREAS, pursuant to the terms of those certain Subscription
Agreements between the Company and certain of the original subscribers for
shares of the Series A Preferred Stock it is a condition precedent to the
issuance and delivery of the shares of Series A Preferred Stock and the
Warrants that the subscribers therefor execute and deliver counterparts of this
Agreement; and
WHEREAS, in order to assure the harmonious management of the affairs
of the Company, the Stockholders desire to enter into this Agreement upon the
terms and conditions hereinafter set forth.
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, intending legally to be bound, 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 and
(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,
without limitation, the partners in GKH.
"Agreement" shall mean this Amended and Restated Stockholders'
Agreement, as originally executed and as amended, modified, supplemented or
restated from time to time, as the context requires.
"Applicable Date" shall mean the last business day of the month
immediately preceding the date on which a Terminated Stockholder's employment
is terminated.
"Bankruptcy" shall mean with respect to any Person (i) the making of a
general assignment or composition for the benefit of creditors or (ii) any
commencement of bankruptcy, reorganization, debt arrangement or other case or
proceeding under any bankruptcy or insolvency law, or any liquidation
proceeding under any bankruptcy or insolvency law, or the commencement in
respect of such Person or a substantial portion of such Person's property or
assets of any liquidation proceeding and, if such case or proceeding is not
commenced by such Person, it is either (A) consented to or acquiesced in by
such Person or (B) remains undismissed after 60 days following the date of
commencement thereof.
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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 for cash or
Marketable Securities; 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.
"Cause" when used in connection with the termination of employment of
an Employee Minority Stockholder, shall mean a termination of such Employee
Minority Stockholder's employment by the Company due to (i) the commission by
such Employee Minority Stockholder of an act of fraud, embezzlement or willful
breach of a fiduciary duty to the Company (including the unauthorized
disclosure of confidential or proprietary material information of the Company),
(ii) a conviction of such Employee Minority Stockholder (or a plea of nolo
contendere in lieu thereof) for a felony or a crime involving fraud, dishonesty
or moral turpitude, (iii) willful misconduct as an employee of the Company,
(iv) the willful failure of such Employee Minority Stockholder to render
services to the Company in accordance with his employment, which failure
amounts to a material neglect of his duties to the Company or (v) substantial
dependence, as determined by the Board, on alcohol or any Controlled Substance.
"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.
"Controlled Substance" shall mean a drug, immediate precursor or other
substance listed in Schedule I-V of the Federal Comprehensive Drug Abuse
Prevention and Control Act of 1970, as amended.
"Cost," with respect to a Terminated Stockholder, shall mean the
purchase price paid by the Terminated Stockholder for each share of his Stock
at the time of such Terminated Stockholder's acquisition thereof. In
accordance with the foregoing, each share of Stock owned by a Stockholder may
have a different Cost.
"Director" shall mean a person appointed or elected as a member of the
Board.
"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.
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"Employee Minority Stockholder" shall mean each Minority Stockholder
who is an employee of the Company on the date hereof or on such other date that
such person shall become a party hereto.
"Encumbrance" or "Encumber" shall mean or refer to any lien, claim,
charge, pledge, mortgage, encumbrance, security interest, restriction on voting
or alienation of any kind, adverse interest or preferential arrangement of any
kind, or the interest of a third party under any conditional sale agreement,
capital lease or other title retention agreement.
"Fair Market Value" shall mean the per share value of a share of
Common Stock (determined on a Fully Diluted Basis) as determined within 6
months prior to the date of a Terminated Stockholder's termination of
employment with the Company; provided, however, that if no such determination
has been made within 6 months thereof, then as of the Applicable Date as
determined by the Board; provided, further, that if the Terminated Stockholder
notifies the Board in writing within 10 days of such Terminated Stockholder's
receipt of written notice of the determination of the Fair Market Value of his
Common Stock that he disagrees with such determination, the Board shall retain
an independent nationally-recognized investment banking firm (such firm to be
subject to such Terminated Stockholder's approval, which approval shall not be
unreasonably withheld or delayed) to determine the per share value of the
Common Stock; provided, further, that the Board shall not be required to retain
any such firm more than once in any six month period for all Terminated
Stockholders. Any fees and expenses incurred with respect to such investment
banking firm shall be shared equally by the Terminated Stockholder and the
Company if the Board's determination of Fair Market Value is equal to, higher
than or no more than 15% less than that of such investment banking firm;
otherwise the Company shall pay all the fees and expenses of such investment
banking firm. The determination of Fair Market Value by such investment
banking firm shall be final and binding. The calculation of Fair Market Value
shall include a Minority Discount, shall be determined on the basis of the
Common Stock being fully distributed and shall give effect to restrictions on
transferability. For the purposes of this definition of "Fair Market Value"
the calculation of the value of the Common Stock on a Fully Diluted Basis shall
take into account an increase in the capitalization of the Company in the
amount of the consideration which would have been paid to the Company had the
options, warrants or convertible securities referred to in the definition of
"Fully Diluted Basis" below, actually been exercised.
"Fully Diluted Basis" shall mean with respect to the shares of Common
Stock, the aggregate of (i) the number of shares of Common Stock issued and
outstanding at the time of calculation (other than shares of Common Stock held
in the treasury of the Company or held by any Affiliate of the Company that is
controlled by the Company) and (ii) the number of shares of Common Stock
issuable, at the time of calculation, upon (A) the exercise of any then
exercisable outstanding options, warrants or similar instrument (other than
such instruments held by the Company or any Affiliate of the Company that is
controlled by the Company) and (B) the exercise of any then exercisable
conversion or exchange rights with respect to any outstanding securities
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or instruments (other than such securities or instruments held by the Company
or any Affiliate of the Company that is controlled by the Company).
"GKH" shall mean the collective reference to (i) GKH Investments,
L.P., a Delaware limited partnership ("GKH Investments"), (ii) GKH Partners,
L.P., a Delaware limited partnership ("GKH Partners"), and (iii) their
respective Affiliates. Any and all decisions and determinations required to be
made by GKH hereunder shall be made by GKH Partners, for itself, GKH and their
respective Affiliates.
"Marketable Securities" shall mean securities of a Person which Person
files periodic reports pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934, as amended, but only to the extent such securities being
offered by a Bona Fide Purchaser to a Stockholder are, at the time of the
offer, being publicly traded in the over-the- counter market or on a nationally
recognized exchange.
"Minority Discount" shall mean any impact that the lack of a
controlling interest possessed by a particular block of Common Stock may have
on the valuation of such Common Stock.
"Minority Stockholders" shall mean all of the Stockholders other than
GKH, together with such Stockholders' respective Affiliates. Any and all
decisions and determinations required to be made by a Minority Stockholder
hereunder shall be made by such Minority Stockholder, for itself or himself and
on behalf of its Affiliates.
"Permanent Disability" shall mean the inability of an Employee
Minority Stockholder to perform substantially all his duties and
responsibilities to the Company for either (i) a continuous period of six
months or (ii) 180 days during any consecutive twelve month period by reason of
a physical or mental disability or infirmity which is expected to be permanent
and continuous for life as determined by a physician selected by the Board.
The date of such Permanent Disability shall be (a) in the case of clause (i)
above, the last day of such six month period or, if later, the day on which
such Employee Minority Stockholder submits satisfactory medical evidence of
such Permanent Disability or (b) in the case of clause (ii) above, such date as
is determined in good faith by the Board.
"Person" shall mean any individual, partnership, corporation, limited
liability company, joint venture, trust, firm, association, unincorporated
organization or other entity.
"Retirement" shall mean, the retirement of an Employee Minority
Stockholder as an employee of the Company on or after reaching age 65 or such
age as may be otherwise determined by the Board.
"Stock" shall mean (i) shares of Common Stock, (ii) shares of
Preferred Stock and (iii) options and warrants exercisable with respect to, or
other securities convertible into or exchangeable for shares of, Common Stock.
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"Stockholder" or "Stockholders" shall mean parties hereto (other than
the Company), their appropriate successors and assigns and any Person who is a
holder of Stock and is or is required to be a party hereto at the time of
reference thereto.
"Transfer Notice" shall mean the notice required to be delivered by
the Seller to the Company and GKH pursuant to Section 3.2. 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.
"Voluntary Termination" shall mean the voluntary termination by an
Employee Minority Stockholder of his employment by the Company by voluntary
resignation or any other means other than death, Retirement or Permanent
Disability and other than simultaneous with or following termination for Cause
or an event which if known to the Company at the time of such voluntary
termination by such Employee Minority Stockholder would constitute Cause. A
Voluntary Termination shall be with "Good Reason" if (i) it promptly follows a
material reduction of such Employee Minority Stockholder's duties and
responsibilities or a permanent change in such Employee Minority Stockholder's
duties and responsibilities which are materially inconsistent with the type of
duties and responsibilities of such Employee Minority Stockholder then in
effect, (ii) it promptly follows a material reduction in annual base salary
(without regard to bonus compensation, if any), (iii) it promptly follows a
material reduction in such Employee Minority Stockholder's employee benefits
(without regard to bonus compensation, if any) if such reduction results in
such Employee Minority Stockholder receiving benefits which are, in the
aggregate, materially less than the benefits received by other comparable
employees of the Company generally or (iv) the Board of Directors of the
Company otherwise determines that a Voluntary Termination by such Employee
Minority Stockholder is for "Good Reason" under the circumstances then
prevailing. The Board shall, upon the written request of an Employee Minority
Stockholder, determine whether such Employee Minority Stockholder's Voluntary
Termination under circumstances outlined by the Employee Minority Stockholder
would be considered "for Good Reason" pursuant to this definition.
1.2 Certain Other Defined Terms The following terms are defined
in the Section of this Agreement directly opposite such terms:
Term Section
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Common Stock preamble
Company preamble
Debt Instrument 3.5(e)
Effective Date 4.13
Exempt Distributions 3.1(a)
Participating Minority Stockholder 3.4(b)
Preferred Stock preamble
Prior Stockholders' Agreements preamble
Purchasers 3.2(c)
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Term Section
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Secondary Notice 3.2(b)
Seller 3.2(a)
Series A Preferred Stock preamble
Subscription Agreements 4.9
Terminated Stockholder 3.5
Warrants 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
Organizational Documents; Directors
2.1 Articles of Incorporation; By-Laws. From and after the date
hereof, each Stockholder shall vote the Common Stock owned by him or it at any
meeting of the stockholders of the Company or in any written consent executed
in lieu of such a meeting of stockholders and shall take all actions necessary
to insure that the Certificate of Incorporation and By-Laws of the Company do
not, at any time, conflict with the provisions of this Agreement and take all
necessary and required action to cause the Company to amend, or amend and
restate, the Certificate of Incorporation and By-Laws of the Company as
necessary to effectuate the purposes of this Agreement.
2.2 Directors.
(a) Nominees. The Stockholders shall vote their
Common Stock at any regular or special meeting of the stockholders of the
Company called for the purpose of filling positions on the Board, or in any
written consent executed in lieu of such a meeting of stockholders, shall take
all actions necessary and shall cause the Directors nominated by them pursuant
to this Agreement to take all actions necessary (including the nomination for
election as directors of the persons specified below) to ensure the election to
the Board of the following individuals:
(A) Xxxxxxx X'Xxxxxx, so long as he is
a stockholder of the Company, is employed by the Company as
Chairman and desires to be a Director of the Company;
(B) Xxxxxxx X. XxXxxx, so long as he is a
stockholder of the Company, is employed by the Company as its
Chief Executive Officer and desires to be a Director of the
Company; and
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(C) such other individuals (the "GKH
Nominees") as are necessary to fill the remaining positions on
the Board (which shall in all events be a majority of the
Board) as nominated by GKH.
(b) Removal. Upon the request of GKH, each
Stockholder shall promptly vote the shares of Common Stock held by him to
remove any individual nominated by GKH and appoint another director nominated
by GKH in his stead. Each Minority Stockholder hereby grants to GKH a limited
power of attorney authorizing GKH to take such actions as it deems necessary to
effectuate the purpose and intent of this Section 2.2(b) in the event that such
Minority Stockholder shall fail to fully comply with the provisions of this
Section.
(c) Stockholder Action. In order to effectuate the
provisions of this Section 2.2, each Stockholder hereby agrees, subject to
compliance with applicable law, that when any action or vote is required to be
taken by such Stockholder pursuant to applicable law or this Agreement, such
Stockholder shall use its reasonable best efforts to (i) call, to take all
other actions necessary to call and to cause the Directors nominated by them to
take all actions necessary to call or to cause the appropriate officers and
directors of the Company to call, a special or annual meeting of stockholders
of the Company, as the case may be, or execute or cause to be executed a
consent in writing in lieu of any such meetings pursuant to the General
Corporation Law of the State of Delaware, or any successor statute, to
effectuate such stockholder action and (ii) vote the Common Stock held by him
in a manner consistent with the terms and provisions of this Agreement.
2.3 Preemptive Rights. In the event that the Company shall offer
for sale to Stockholders additional shares of Common Stock, each Stockholder
shall have right to acquire its pro rata share of such offering on the same
terms and conditions offered to all other Stockholders; provided, however, this
right shall not apply to (a) shares issuable in connection with a merger,
acquisition or other similar transaction, (b) shares issuable upon the exercise
of any options, warrants or other convertible securities, (c) shares offered by
the Company to employees and directors of the Company or (d) shares issuable in
connection with preemptive rights granted to other stockholders of the Company
in connection with a merger, acquisition or similar transaction, or in
connection with the issuance by the Company of its 6.5% Cumulative Redeemable
Convertible Series B Preferred Stock.
ARTICLE III
Transfer Restrictions
3.1 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
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terms and conditions of this Article III, (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 (i), (ii) and (iii) are collectively referred to
herein as "Exempt Distributions." 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 the transfer set forth in this Article III, but subject to the
provisions of Section 3.1(f) hereof, any Stockholder (other than an Affiliate
of a Stockholder which acquired Stock pursuant to this Section 3.1(b)) may
Dispose of all or a portion of its Stock to an Affiliate without first
complying with any other provision of this Article III.
(c) Transfers to Persons other than Affiliates.
Except pursuant to the procedures described in Sections 3.2, 3.3, 3.4 and 3.5
hereof, 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, with or without cause, in the sole and absolute discretion of such
other Stockholders). Any Stock Disposed of pursuant to this Section 3.1(c)
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.
(d) The provisions of Section 3.1(c) notwithstanding,
GKH may, without complying with the provisions of this Article III, Dispose of
Stock held by it to any Person so long as after the consummation of such
transaction, GKH and its Affiliates shall own at least 50% of the outstanding
Common Stock and (ii) GKH may, without complying with the provisions of this
Article III, Dispose of all or a portion of its Stock to its partners or other
beneficial owners.
(e) Pledge. No Stockholder may pledge or hypothecate
any of its Stock for any purpose; provided, however that a Minority Stockholder
may pledge his Common Stock to the Company as security for a loan or loans made
by the Company to such Minority Stockholder, the proceeds of which were used
solely to purchase Common Stock.
(f) Rules of Construction and General Application.
The following rules of construction shall be applicable to all transactions
consummated pursuant to Article III:
(i) 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 Sections 3.1(d), 3.3 and 3.4 hereof, each transferee
of Stock pursuant to this Article III (including transferees pursuant
to Section 3.1(b)), shall execute and acknowledge such
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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
conditions 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.
(iii) Except for rights of GKH pursuant to
Sections 3.1(d) and 3.3, during the term of any proceedings,
transactions or Dispositions pursuant to any provision of Article III,
no Stockholder may exercise any rights under any provision of Article
III (other than rights granted to such Stockholder pursuant to the
provision under which such proceedings are taking place or in
progress) except, in the event one or more Stockholders are exercising
their rights as Participating Minority Stockholders pursuant to
Section 3.4 hereof and concurrently therewith other Stockholders
desire to exercise their rights pursuant to Section 3.2(b) hereof,
then such Stockholders exercising their rights pursuant to Section
3.2(b) shall purchase, all, but not less than all, of the Stock that
is proposed to be sold pursuant to Section 3.4 (including Stock held
by GKH and the Participating Minority Stockholders) in accordance with
the terms of Section 3.2(b).
3.2 Dispositions by Minority Stockholders.
(a) Offer from Bona Fide Purchaser. If a Minority
Stockholder (for purposes of this Section 3.2, "Seller") desires to effect the
Disposition of all of its Stock to a Bona Fide Purchaser, 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 sell less than all of its Stock to any such Bona Fide Purchaser.
(b) Rights of First and Second Refusal. By delivery
of the Transfer Notice, Seller shall be deemed to have offered the Company, 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, the Company
shall deliver written notice to such effect to Seller within 25 days of its
receipt of the Transfer Notice. In the event that the Company exercises its
rights for less than 100% of the Seller's Stock pursuant to the first sentence
of this Section 3.2(b), then the Company shall within 30 days of the date that
the Transfer Notice is deemed given hereunder provide GKH 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. GKH 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 GKH will purchase. If the Company and/or GKH, 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 3.2(c) hereof.
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A failure by either the Company or GKH to timely deliver any notice of intent
to purchase required pursuant to this Section 3.2(b) shall constitute such
Persons's failure to exercise its rights under this Section 3.2(b).
(c) Consummation of Purchase.
(i) The purchase price payable by
either the Company or GKH or their respective designees (collectively,
the "Purchasers") to Seller shall be paid as set 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 3.2(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 3.2(b), (A) each
Purchaser 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 Purchaser appropriate instruments of
assignment duly executed in a proper form to effect the transfer of
such Stock from Seller to each such Purchaser on the books and records
of the Company.
(d) Other Disposition Provisions.
(i) If the Purchasers do not agree to
purchase all of Seller's Stock by the expiration of the periods set
forth in Section 3.2(b), Seller shall have 45 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 Company and GKH pursuant to Section 3.2, 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 Company
and GKH.
(iii) If Seller shall fail to
consummate a Disposition of its Stock within the time period set forth
in Section 3.2(d)(i), then no Disposition of such Stock may be made by
Seller without first re-offering such Stock to the Company and GKH in
accordance with the provisions of this Section 3.2.
3.3 Rights to Compel Disposition.
(a) Rights of GKH. If GKH proposes to Dispose of all
(but not less than all) of the Common Stock owned by it to a Bona Fide
Purchaser, then, notwithstanding anything in this Agreement to the contrary,
GKH may require the Minority Stockholders to Dispose of their Common 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 Common Stock.
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(b) Obligations of Minority Stockholders. In the
event that GKH desires to exercise its rights pursuant to Section 3.3(a), GKH
shall deliver to the Company and the Minority Stockholders written notice
setting forth the consideration per share to be paid by such Bona Fide
Purchaser and the other terms and conditions of such Disposition. Within 15
days following the date of such notice, each Minority Stockholder shall deliver
to GKH (i) a stock certificate or certificates evidencing such Minority
Stockholder's Common Stock, together with an appropriate assignment separate
from certificate duly executed in a proper form to effect the Disposition of
such Common Stock from such Minority Stockholder 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 Common 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 Minority Stockholders' Common Stock is disposed of
for the same consideration per share and otherwise on the same terms and
conditions upon which GKH effects the Disposition of its Common Stock. In the
event that any Minority Stockholder shall fail to deliver such stock
certificate(s), (A) assignment separate from certificate 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 Common Stock of such Minority Stockholder
is bound by the provisions of this Section 3.3 and that the Disposition of such
Common Stock may be effected without such Minority Stockholder's consent or
surrender of its Common Stock and (B) hold back the proceeds of the Disposition
of any such Minority Stockholder's Common Stock in an interest bearing account
pending compliance by such Minority Stockholder with its obligations under this
Section 3.2(b).
In addition, in the event GKH exercises its rights under this Section
3.3(a), each Minority Stockholder shall be required to make to a Bona Fide
Purchaser such unqualified representations and warranties with respect to its
Common Stock as are set forth in Section 3.6(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. Promptly after the
consummation of the Disposition of Common Stock pursuant to this Section 3.3,
GKH shall (i) deliver notice thereof to the Minority Stockholders, (ii) remit
to the Minority Stockholders the total consideration received by GKH, if any,
with respect to the Minority Stockholders' Common Stock Disposed of 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 such Minority Stockholders.
(d) Failure to Effect Transfer. If, within 120 days
after GKH's delivery of the notice required pursuant to Section 3.3(b), GKH has
not completed the Disposition of its Common Stock and that of the Minority
Stockholders in accordance herewith, GKH shall return to each of the Minority
Stockholders (i) the stock certificates and assignments of certificates with
respect to such Minority Stockholder's Common Stock which such Minority
Stockholder delivered pursuant to this Section 3.3 and (ii) the related limited
power-of-attorney. Upon the Minority
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Stockholders' receipt of such materials, all of the restrictions on Disposition
contained in this Agreement with respect to the Common Stock owned by the
Stockholders shall again be in effect.
3.4 Rights of Inclusion.
(a) Rights of Minority Stockholders. If (i) GKH
proposes to Dispose of Common Stock owned by it to a Bona Fide Purchaser, (ii)
such Common Stock represents greater than 50% of the outstanding Common Stock
(on an undiluted basis) then owned by GKH and (iii) GKH elects not to exercise
its rights under Section 3.3, then each Minority Stockholder, at its sole right
and option, may require GKH to require the Bona Fide Purchaser to purchase that
percentage of its Common Stock which is equal to the percentage of all Common
Stock then owned by GKH that is being so Disposed of by GKH for the same
consideration per share and otherwise on the same terms and conditions upon
which GKH effects the Disposition of its Common Stock.
(b) Obligations of Participating Minority
Stockholders. If GKH desires to accept a Bona Fide Purchaser's offer to
purchase all of the Common Stock which GKH proposes to sell in accordance with
this Section 3.4(a), GKH shall deliver a copy of the Bona Fide Purchaser's
offer to the Company and each of the Minority Stockholders, and, within 15 days
of the receipt of such copy, each Minority Stockholder desiring to exercise its
rights pursuant to this Section 3.4 (each a "Participating Minority
Stockholder," collectively, the "Participating Minority Stockholders") shall
deliver to the Company and GKH written notice to such effect and shall deliver
to GKH (i) a stock certificate or certificates evidencing its Common Stock,
together with an appropriate assignment separate from certificate duly executed
in a proper form to effect the Disposition of the Participating Common 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
Common 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 Minority
Stockholders' Common Stock that is being transferred pursuant to this Section
3.4 is Disposed of for the same consideration per share and otherwise on the
same terms and conditions upon which GKH effects the Disposition of its Common
Stock. The failure of a Minority Stockholder to deliver notice of its desire
to exercise its rights under or to otherwise comply with the provisions of this
Section 3.4(b) shall be deemed to be a waiver of such Minority Stockholder's
rights hereunder and such Minority Stockholder shall not be deemed to be a
Participating Minority Stockholder.
(c) Responsibility of GKH. Promptly after the
consummation of the sale of Common Stock under this Section 3.4, GKH shall (i)
deliver notice thereof to the Participating Minority Stockholders of the sale,
(ii) remit to the Participating Minority Stockholders the total consideration
received by GKH, if any, with respect to the Minority Stockholders' Common
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 a Participating Minority Stockholder.
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(d) Failure to Effect Transfer. If, within 120 days
after GKH's delivery of the copy of the Bona Fide Purchaser's offer pursuant to
Section 3.4(b), GKH has not completed the Disposition of its Common Stock and
that of the Participating Minority Stockholders in accordance herewith, GKH
shall return to each of the Participating Minority Stockholders (i) the stock
certificates and assignments of certificates with respect to such Participating
Minority Stockholder's Common Stock which such Participating Minority
Stockholder delivered for Disposition pursuant to this Section 3.4 and (ii) the
related limited power-of-attorney. Upon the Participating Minority
Stockholders' receipt of such materials, all the restrictions on Disposition
contained in this Agreement with respect to the Common Stock owned by the
Stockholders shall again be in effect.
3.5 Certain Sales Upon Termination of Employment. In the event
that an Employee Minority Stockholder (the "Terminated Stockholder") ceases to
be employed by the Company or any of its Affiliates, the parties shall have the
rights set forth in this Section 3.5, which rights and obligations shall
survive the termination of this Agreement.
(a) Termination for Cause. In the event the
employment of the Terminated Stockholder is terminated for Cause, the Company
shall have the right, but not the obligation for a period of 90 days thereafter
to purchase all, but not less than all, of the Common Stock of the Terminated
Stockholder by delivering written notice to such effect. The purchase price
for the Common Stock purchased pursuant to this Section 3.5(a) shall be equal
to the lesser of (i) Cost and (ii) 80% of the Fair Market Value thereof,
payable by delivery of a promissory note of the Company having a term of seven
years and otherwise complying with Section 3.5(f) hereof.
(b) Termination upon Death, Retirement or Permanent
Disability or Without Cause. In the event the employment of the Terminated
Stockholder is terminated by death, Retirement, Permanent Disability or without
Cause, the Company shall have the right, but not the obligation, to purchase
all, but not less than all, of the Common Stock of the Terminated Stockholder
by delivering written notice to such effect within 90 days thereafter. The
purchase price for the Common Stock purchased pursuant to this Section 3.5(b)
shall be the Fair Market Value thereof, payable, subject to Section 3.5(e)
hereof, in cash.
(c) Voluntary Termination with Good Reason. Upon
Voluntary Termination with Good Reason, the Company shall have the right, but
not the obligation, to purchase all, but not less than all, of the Common Stock
of the Terminated Stockholder by delivering notice to such effect within 90
days thereafter. The purchase price for the Common Stock purchased pursuant to
this Section 3.5(c) shall be the Fair Market Value thereof, payable, subject to
Section 3.5(e) hereof, in cash.
(d) Voluntary Termination without Good Reason. Upon
Voluntary Termination without Good Reason, the Company shall have the right,
but not the obligation, to purchase all, but not less than all, of the Common
Stock of the Terminated Stockholder by delivering written notice to such effect
within 90 days thereafter. The purchase price for the
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Common Stock purchased pursuant to this Section 3.5(d) shall be equal to the
lesser of (i) Cost and (ii) the Fair Market Value thereof. If the termination
occurs on or prior to the third anniversary of this Agreement, the purchase
price shall be payable by delivery of a promissory note of the Company having a
term of seven years and otherwise complying with Section 3.5(f) hereof. If
such termination occurs after the third anniversary of this Agreement, the
purchase price shall be payable in cash (subject to Section 3.5(e) hereof).
(e) Exceptions for Payment in Cash. Notwithstanding
anything herein to the contrary, if the payment of all or a portion of the
purchase price in cash under any subsection of Section 3.5 would cause a
default under any agreement or instrument respecting the incurrence of
indebtedness, including, without limitation, any credit agreement, note,
mortgage, bond, indenture, or deed of trust to which the Company or any of its
subsidiaries is a party or by which any of its or their properties or assets
are bound (each, a "Debt Instrument") then such portion of the purchase price
shall be payable in cash to the extent such default would not be caused and the
remainder of such portion of the purchase price shall be payable pursuant to
the Company's delivery of a promissory note in accordance with Section 3.5(f)
and having the shortest term permissible without causing such a default. To
the extent that any or all of the portion of the purchase price is payable to
the Terminated Stockholder in cash, the amount of such payment shall offset by
the cancellation of any indebtedness owed by the Terminated Stockholder to the
Company or its Affiliates (including, without limitation, any indebtedness owed
by such Terminated Stockholder to the Company in connection with such
Terminated Stockholder's purchase of the Common Stock).
(f) Payment Pursuant to Promissory Note. Any
promissory note of the Company required to be delivered pursuant to this
Section 3.5 shall be in a form reasonably acceptable to the parties and shall
have the following terms: (i) the principal amount of the note shall be equal
to the purchase price for the Terminated Stockholder's Common Stock offset by
the cancellation of any indebtedness owed by the Terminated Stockholder to the
Company or its Affiliates (including, without limitation, any indebtedness owed
by such Terminated Stockholder to the Company in connection with such
Terminated Stockholder's purchase of the Common Stock) after giving effect to
any such offset made pursuant to Section 3.5(e), (ii) the Company's obligations
under such promissory note shall be subordinated and subject in right of
payment to the prior payment of all indebtedness of the Company and its
subsidiaries the terms of which require such subordination, (iii) the principal
amount of such promissory note shall be payable, to the extent permitted by all
Debt Instruments, in equal annual installments commencing on the first
anniversary of the issuance thereof and continuing as required by subsection
(a), (d) or (e), as appropriate, of this Section 3.5 and (iv) the principal
amount of such promissory note shall be bear interest payable annually at the
prime rate announced from time to time by Chemical Bank in New York, New York.
(g) Tender of Common Stock. Any payment of the
purchase price pursuant to Section 3.5, whether by delivery of a note, in cash
or by a combination thereof, shall be made
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against delivery of the certificates representing the Common Stock so
purchased, duly endorsed, or, at the purchaser's option, accompanied by a stock
power executed in blank.
3.6 Agreement of Selling Stockholder. All sales of Common Stock
to be made pursuant to Sections 3.2, 3.3, 3.4 and 3.5 of this Agreement shall
be subject to the following terms:
(a) Deliveries. Subject to the provisions of Section
3.1 hereof, the Seller shall deliver to the purchaser certificates evidencing
the Common Stock being sold, free and clear of any Encumbrance, together with
duly executed transfers thereof in favor of the purchaser or its nominees and
such other documents, including evidence of ownership and authority, as the
purchaser may reasonably request;
(b) Representations and Warranties. The Seller shall
not be required to make any representations or warranties to any Person in
connection with such sale, except as to (i) good title to the Common Stock
being sold, (ii) the absence of Encumbrances with respect to the Common Stock
being sold, (iii) the due organization and valid existence of the Seller if the
Seller is not an individual, (iv) the authority for, and validity and binding
effect of (as against such Seller), any agreement entered into by such Seller
in connection with such sale, (v) all required material consents to Seller's
sale and governmental approvals having been obtained (excluding any approvals
required by applicable state or federal securities laws) and (vi) the fact that
no broker's commission is payable by the Seller as a result of Seller's conduct
in connection with the sale; and
(c) Indemnification. The Seller shall not be required
to provide any indemnities in connection with such sale except for breach of
the representations and warranties contained in Section 3.6(b).
ARTICLE IV
Miscellaneous Provisions
4.1 Endorsement on Common Stock Certificates. Each and every
certificate of stock evidencing Common Stock and Preferred Stock shall contain
upon its face, or on the reverse side thereof, the following legend:
"THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED, AND MAY NOT BE OFFERED, SOLD OR OTHERWISE
TRANSFERRED, PLEDGED OR HYPOTHECATED UNLESS AND UNTIL REGISTERED UNDER
SUCH ACT, OR UNLESS SUCH OFFER, SALE, TRANSFER, PLEDGE OR
HYPOTHECATION IS EXEMPT FROM REGISTRATION OR IS OTHERWISE IN
COMPLIANCE WITH SUCH ACT. THE TRANSFERABILITY OF THIS SECURITY IS
ALSO SUBJECT TO RESTRICTIONS CONTAINED IN A STOCKHOLDERS AGREEMENT
WHICH
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AGREEMENT THE COMPANY WILL FURNISH TO THE HOLDER OF THIS SECURITY
UPON REQUEST.
A STATEMENT SUMMARIZING THE VOTING POWERS, DESIGNATIONS,
PREFERENCES, LIMITATIONS, RESTRICTIONS AND RELATIVE RIGHTS OF THE
VARIOUS CLASSES OF STOCK OR SERIES THEREOF MAY BE OBTAINED BY THE
STOCKHOLDERS OF THE COMPANY, WITHOUT CHARGE, FROM THE PRINCIPAL
OFFICES OF THE COMPANY."
4.2 Termination.
(a) Voting Provisions. Sections 2.1 and 2.2 of this
Agreement shall terminate upon GKH ceasing to own 50% of the then issued and
outstanding Common Stock (on an undiluted basis).
(b) Agreement. This Agreement (other than the
provisions of Section 3.5 hereof and provisions necessary to effectuate the
intent of Section 3.5) shall terminate upon the earliest to occur of the
following events:
(i) Bankruptcy of the Company;
(ii) the Common Stock being owned by a single
Stockholder;
(iii) the passage of six months (or such longer
time period required by the Company's underwriters) from the date 25%
or more of the issued and outstanding Common Stock is listed on a
nationally recognized exchange or quoted on the National Association
of Securities Dealers Automated Quotation System;
(iv) GKH ceases to own 35% or more of the then
issued and outstanding Common Stock (on an undiluted basis); or
(v) the voluntary agreement, in writing, of
(A) the Company, (B) GKH and (C) Minority Stockholders holding a
majority of the Common Stock then held by all Minority Stockholders.
4.3 Common 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 Effective Date, (ii)
any Stock issued to any Stockholder pursuant to Section 4.3(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 by, acquired by or
issued to any
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Stockholder. All stock certificates evidencing Stock subject to this
Agreement shall, on the reverse thereof, contain the restrictive legend set
forth in Section 4.1.
(b) If at any time, and from time to time, the Company
shall declare and pay a dividend upon any of the Stock in the form of
additional shares of Stock, or shall validly issue shares 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 shares 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 nationally recognized overnight mail delivery or courier service, (c) 5 days
after being mailed by certified or registered mail, return receipt requested,
postage prepaid or (d) delivery by prepaid telegram or facsimile transmission
(with written confirmation of receipt). All notices shall be addressed to the
Company at its principal office and to the Stockholders at their addresses last
appearing on the stock records of the Company. Any party hereto may change 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
Articles or 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 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 (a)
the Company, (b) GKH and (c) Minority Stockholders holding a majority of the
shares of Common Stock (on a Fully Diluted Basis) then held by all Minority
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 and the agreements and related documentation, if any, pursuant to
which the Stockholders acquired their respective shares of Stock from the
Company, constitute the entire agreement among the parties hereto and supersede
all prior agreements and
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understandings, oral or written, among the parties hereto with respect to the
subject matter hereof and thereof including, without limitation, the Prior
Stockholders' Agreements.
4.10 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.
4.11 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 the
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.
4.12 Consent of Spouse; Insertion in Will. Each married Minority
Stockholder, or, if currently unmarried, each Minority Stockholder upon his
marriage, agrees to obtain the consent and approval of his spouse to all of the
terms and provisions of this Agreement by the execution hereof by such spouse.
Each Minority Stockholder, if an individual, agrees to insert in his last will
and testament, or other similar instrument, or to execute a codicil thereto,
directing and authorizing his personal representatives to fulfill and comply
with the provisions hereof and to sell and transfer his Common Stock in
accordance with the terms and provisions of this Agreement.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
day and year first above written.
THE COMPANY:
HANOVER COMPRESSOR COMPANY, a Delaware corporation
By:
----------------------------------------------
Xxxxxx Xxxxxxx
Chief Financial Officer and
Treasurer
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STOCKHOLDERS:
GKH INVESTMENTS, L.P., a Delaware
limited partnership
By: GKH PARTNERS, L.P., a Delaware
limited partnership, its general
partner
By: JAKK HOLDING CORP., a Nevada
corporation, a general partner
By:
-----------------------------------
Name: Xxxxxx X. Xxxxx,
President
GKH PARTNERS, L.P., a Delaware limited
partnership
By: JAKK HOLDING CORP., a Nevada
corporation, a general partner
By:
-----------------------------------
Name: Xxxxxx X. Xxxxx,
President
[signatures of Minority Stockholders
continued on next pages]
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SIGNATURE PAGE TO AMENDED AND RESTATED STOCKHOLDERS'
AGREEMENT, DATED AS OF AUGUST 7, 1995,
FOR MINORITY STOCKHOLDERS
(INDIVIDUALS)
MINORITY STOCKHOLDER:
---------------------------------------
Print Name:
----------------------------
Number of Shares:
----------------------
Home Address:
--------------------------
SPOUSAL CONSENT
The undersigned, the spouse of the Minority Stockholder whose name
appears immediately above, which Minority Stockholder is one of the parties to
the foregoing Amended and Restated Stockholders' Agreement, hereby consents to
the execution of Amended and Restated Stockholders' Agreement and the
consummation of the transactions contemplated thereby by her spouse, and to the
extent the undersigned has acquired or hereafter acquires an interest in and to
the property and subject matter of the Amended and Restated Stockholders'
Agreement, hereby agrees to be bound by the terms of such Amended and Restated
Stockholders' Agreement.
Date:
--------------------------- -----------------------------------
Print Name:
------------------------
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SIGNATURE PAGE TO AMENDED AND RESTATED STOCKHOLDERS' AGREEMENT
FOR MINORITY STOCKHOLDERS
(ENTITIES)
MINORITY STOCKHOLDER:
---------------------------------------
By:
-----------------------------------
Its:
----------------------------------
Number of Shares:
---------------------
Address:
------------------------------
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