PUT AGREEMENT
This Put Agreement (the "Agreement"), dated as of March 24, 1997, is made
by and among (i) Mity-Lite, Inc., a Utah corporation ("Mity-Lite") and (ii)
Xxxxxx Xxxxxxx, Xxxxx Xxxxxxx, Xxxxxxx Xxxxxxxx, ChiCol Group, Inc., an Ohio
corporation, Sican II Corp., a Delaware corporation and DO Group, Inc., a
Delaware corporation (together, the "DO Group Parties").
RECITALS:
WHEREAS, Mity-Lite has purchased 49.9% of the issued and outstanding shares
(the "Minority Shares") of common stock, no par value (the "DO Group Common
Stock"), of DO Group, Inc., a Delaware corporation ("DO Group"), from certain
shareholders of DO Group, effective as of the date of this Agreement (the
"Minority Share Purchase") for an aggregate purchase price of $750,000 (the
"Purchase Price");
WHEREAS, the DO Group Parties have direct or indirect interests in and/or
are employed by DO Group; and
WHEREAS, in exchange for Mity-Lite's agreement (i) to provide up to
$1,000,000 of term financing to DO Group and/or its subsidiaries as evidenced by
the Term Loan Agreement executed concurrently herewith and related documents
(the "Loan Documents") and (ii) to grant stock options to certain of the DO
Group Parties, the DO Group Parties have agreed to grant the put rights
described herein to Mity-Lite.
NOW, THEREFORE, in consideration of the premises and the mutual covenants
herein contained, the parties hereby agree as follows:
1. PUT RIGHT. At any time from and after the date hereof until three years
and 75 days after the date hereof, Mity-Lite shall have the right to require any
or all of the DO Group Parties, and the DO Group Parties hereby agree, jointly
and severally, to acquire the Minority Shares from Mity-Lite for the
consideration determined in accordance with paragraph 2 (the "Put Right").
Mity-Lite may exercise its Put Right at any time by providing written notice
(the "Put Notice") to each of the DO Group Parties as provided in paragraph 6.
The foregoing notwithstanding, the Put Right shall expire upon the conversion of
all of the Class A common stock of DO Group Holding, Inc. into shares of common
stock of Mity-Lite. Mity-Lite will also provide a copy of the Put Notice to the
Estate of Xxxxxxx X. Xxxxx as provided in Section 6.
2. PUT PRICE.
a. Upon the exercise of the Put Right prior to three years and 45
days from the date of this Agreement, the DO Group Parties shall pay
to Mity-Lite cash (the "Put Price") in an amount equal to the Purchase
Price, plus (i) clearly identifiable costs of Mity-Lite associated
with acquiring the Minority Shares (the "Costs") and (ii) accrued
interest at the rate of ten percent (10%) per annum on the Purchase
Price and Costs from the date of this Agreement to the date of payment
of the Put Price.
b. Upon the exercise of the Put Right after three years and 45
days, but up to and including three years and 75 days from the date of
this Agreement, the DO Group Parties shall pay to Mity-Lite the Put
Price in an amount equal to the greater of:
(i) the Put Price set forth in subparagraph a. above; or
(ii) the market value of the Minority Shares, determined by
multiplying
A. the combined after tax net income of DO Group and
its subsidiaries for the twelve full months ending on the
last full calendar month preceding the date of the Put
Notice (the "Notice Date") calculated in accordance with
generally accepted accounting principles
times
B. the average published P/E ratio of Mity- Lite common
stock for the last ten trading days of the last full
calendar month preceding the Notice Date
times
C. Mity-Lite's percentage ownership of the issued and
outstanding DO Group Common Stock as of the Notice Date.
The calculation of the Put Price in accordance with this Section 2 shall be
made by Mity-Lite in good faith and such determinations shall be final and
binding on the parties hereto.
3. PAYMENT. The Put Price shall be payable by the DO Group Parties to
Mity-Lite in cash within sixty (60) days following the Notice Date by wire
transfer or other immediately available funds. Upon confirmation of receipt of
the Put Price, Mity-Lite shall tender to the DO Group Parties certificate(s)
representing the Minority Shares, duly endorsed in blank or accompanied by other
valid evidence of transfer, free and clear of all liens, encumbrances, claims
and restrictions arising following the Minority Share Purchase as a result of
any action or failure to act on the part of Mity-Lite (other than restrictions
under federal and state securities laws).
4. SECURITY. The payment of the Put Price shall be secured by (i) the
Corporate Guaranty and the Stock Pledge Agreement executed in connection with
this Put Agreement and (ii) the shares of Class A Common Stock of DO Group
Holding, Inc., shares of Common Stock of DO Group, Inc. and Sican Corp.
deposited in escrow pursuant to the Escrow Agreement of even date herewith among
U. S. Bank Trust Company, Mity-Lite and certain of the DO Group Parties.
5. GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of Utah, without regard to its conflicts
of laws principles.
6. NOTICES. All notices or other communications required or permitted
hereunder shall be in writing and shall be deemed given when delivered
personally or when sent by facsimile or by registered or certified mail or by
private courier addressed as follows:
if to Mity-Lite, to:
Xxxxxxx X. Xxxxxx
Mity-Lite, Inc.
0000 Xxxx 000 Xxxxx
Xxxx, XX 00000
Telephone: (000) 000-0000
(000) 000-0000
Facsimile: (000) 000-0000
with copies to:
LeBoeuf, Lamb, Xxxxxx & XxxXxx, L.L.P.
1000 Xxxxxx Building
000 Xxxxx Xxxx Xxxxxx
Xxxx Xxxx Xxxx, XX 00000
Attention: Xxxxx X. Xxxxxx, Esq.
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
if to the DO Group Parties, to:
Xxxxxxx Xxxxxxxx
0000 Xxxxxxxx Xxxxxx
Xxxxxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Xxxxx Xxxxxxx
0000 Xxxxxxxx Xxxxxx
Xxxxxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Xxxxxx Xxxxxxx
0000 Xxxxxxxx Xxxxxx
Xxxxxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
ChiCol Group, Inc.
0000 Xxxxxxxx Xxxxxx
Xxxxxxx, XX 00000
Attention: Xxxxxxx Xxxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Sican II
0000 Xxxxxxxx Xxxxxx
Xxxxxxx, XX 00000
Attention: Xxxxxxx Xxxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
DO Group, Inc.
0000 Xxxxxxxx Xxxxxx
Xxxxxxx, XX 00000
Attention: Xxxxxxx Xxxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
if to Dekko, to:
Estate of Xxxxxxx X. Xxxxx
0000 Xxxxxxxx Xxxxx
Xxxxxxxxxxxx, XX 00000
Attention: Xxxxx Xxxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
or to such other address as such party may indicate by a notice delivered
to the other parties hereto.
7. SUCCESSORS AND ASSIGNS. The rights and obligations of each party under
this Agreement shall not be assignable by such party hereto except that
Mity-Lite may assign its rights and/or obligations to any affiliate of
Mity-Lite. This Agreement shall be binding upon and inure to the benefit of the
parties hereto and their successors, heirs and assigns. Nothing in this
Agreement, expressed or implied, is intended or shall be construed to confer
upon any person or entity other than the parties and authorized successors and
assigns hereunder, any right, remedy or claim under or by reason of this
Agreement.
8. ENTIRE AGREEMENT; AMENDMENTS. This Agreement contains the entire
understanding of the parties hereto with regard to the subject matter contained
herein, and supersedes all prior agreements, understandings or intents between
or among any of the parties hereto. The parties hereto, by mutual agreement in
writing signed by all parties hereto, may amend, modify and supplement this
Agreement.
9. WAIVERS. Any term or provision of this Agreement may be waived, or the
time for its performance may be extended or shortened, by the party or parties
entitled to the benefit thereof. Mity-Lite may grant any such waiver to any one
or more of the DO Group Parties without affecting the liability of the other DO
Group Parties under this Agreement. The failure of any party hereto to enforce
at any time any provision of this Agreement shall not be construed to be a
waiver of such provision, nor in any way to affect the validity of this
Agreement or any part hereof or the right of any party thereafter to enforce
each and every such provision. No waiver of any breach of this Agreement shall
be held to constitute a waiver of any other or subsequent breach.
10. EXPENSES. Each party hereto will pay all costs and expenses incident to
its compliance with all agreements and conditions contained herein on its part
to be performed or complied with, including the fees, expenses and disbursements
of its counsel and accountants. In the event of a breach of this Agreement by
any party hereto, the breaching party shall pay all nonbreaching parties any
costs or fees, including attorneys' and accountants' fees, incurred as a result
of such breach or in connection with any arbitration brought under Section 12
hereof or the enforcement of any arbitration award hereunder.
11. PARTIAL INVALIDITY. Whenever possible, each provision hereof shall be
interpreted in such manner as to be effective and valid under applicable law,
but in case any one or more of the provisions contained herein shall, for any
reason, be held to be invalid, illegal or unenforceable in any respect, such
invalidity, illegality or unenforceability shall not affect any other provision
of this Agreement, and this Agreement shall be construed as if such invalid,
illegal or unenforceable provision or provisions had never been contained herein
unless the deletion of such provision or provisions would result in such a
material change as to cause completion of the transactions contemplated hereby
to be unreasonable.
12. ARBITRATION. The parties agree that, upon written demand by any of the
parties, any dispute or claim regarding the Put Price or any other matter
hereunder shall be settled by binding arbitration. The arbitration proceeding
shall be conducted in Salt Lake City, Utah under the Commercial Arbitration
Rules of the American Arbitration Association in effect at the time a written
demand for arbitration is made by a panel of three arbitrators selected by the
American Arbitration Association. A decision and award of the panel of
arbitrators made under said rules shall be made within twenty (20) days of the
conclusion of the arbitration hearing and shall be conclusive, final and binding
on all parties, their heirs, executors, administrators, successors and assigns
and enforceable against the parties.
13. EXECUTION IN COUNTERPARTS. This Agreement may be executed in two or
more counterparts, each of which shall be considered an original instrument, but
all of which shall be considered one and the same agreement.
[SIGNATURE PAGE FOLLOWS]
IN WITNESS WHEREOF, the parties hereto have caused this Put Agreement to be
executed the day and year first above written.
MITY-LITE, INC.
By: /s/ Xxxxxxx X. Xxxxxx
Its: President
/s/ Xxxxxx Xxxxxxx
Xxxxxx Xxxxxxx
/s/ Xxxxx Xxxxxxx
Xxxxx Xxxxxxx
/s/ Xxxxxxx Xxxxxxxx
Xxxxxxx Xxxxxxxx
XXXXXX GROUP, INC.
By: /s/ Xxxxxx Xxxxxxx
Its: Chairman
SICAN II CORP.
By: /s/ Xxxxxx Xxxxxxx
Its: Xxxxxx Xxxxxxx
DO GROUP, INC.
By: /s/ Xxxxxx Xxxxxxx
Its: Xxxxxx Xxxxxxx
