MANAGEMENT STOCK PURCHASE AGREEMENT
EXECUTION COPY
EXHIBIT 10.9
EXHIBIT 10.9
This MANAGEMENT STOCK PURCHASE AGREEMENT (this “Agreement”), is entered into as of
this 3rd day of August, 2005, by and among SOI Holdings, Inc., a Delaware corporation (the
“Company”), and Xxxx Xxxxxxx (the “Executive”).
“Fair Market Value” shall mean (a) in the case of the Company Common Stock, (i) if the
Company Common Stock is listed on a national securities exchange, the average of the highest and
lowest sale prices of a share of the Company Common Stock reported as having occurred on the
primary exchange with which the Company Common Stock is listed and traded on the date prior to such
date, or, if there is no such sale on that date, then on the last preceding date on which such a
sale was reported; (ii) if the Company Common Stock is not listed on any national securities
exchange but is quoted in the Nasdaq National Market (the “Nasdaq”) on a last sale basis,
the average between the high bid price and low ask price reported on the date prior to such date,
or, if there is no such sale on that date, then on the last preceding date on which a sale was
reported; or (iii) if the Company Common Stock is not listed on a national securities exchange nor
quoted in the Nasdaq on a last sale basis, the amount determined by the compensation committee of
the Board of Directors (the “Committee”), or if no such committee has yet been established,
the Board of Directors, to be the fair market value based upon a good faith attempt to value the
Company Common Stock accurately and computed in accordance with applicable regulations of the Internal Revenue Service; and (b) in the
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case of
the Company Preferred Stock, the amount determined by the Committee to be the fair market value
based upon a good faith attempt to value the Company Preferred Stock accurately, and computed in
accordance with the applicable regulations of the Internal Revenue Service.
“IPO” shall mean the first sale in an underwritten offering of the Company Common
Stock pursuant to a Registration Statement on Form S-1 or otherwise under the Securities Act.
“SEC” shall mean the Securities and Exchange Commission.
“Securities Act” shall mean the Securities Act of 1933, as amended.
(a) Upon the termination of the Executive’s employment with SOI, the Shares shall be subject
to the Call Option described in Section 4(b) below and under certain circumstances to the Put
Option described in Section 4(c) below.
(b) Call Option.
(i) Other than as set forth in the second sentence of Section 4(b)(vii), upon
and following (A) a termination of the Executive’s employment by the Company for
Cause or (B) the termination of the Executive’s employment for any reason (other
than the Executive’s death) within one year following the date of this Agreement
for any reason (or no reason), the Company shall have the right and option (the
“Call Option”), but not the obligation, to purchase from the Executive (or
his estate or permitted transferees) any or all of the shares of Company Common
Stock or Company Preferred Stock, as the case may be, owned by the Executive;
provided, that if the Executive is entitled to exercise his Put Right in
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accordance
with Section 4(c) and he does exercise his Put Right, the provisions of Section
4(c) shall govern the repurchase of Shares by the Company. The purchase price (the
“Call Price”) of the Company Common Stock or Company Preferred Stock, as
the case may be, subject to purchase under this provision (the “Called
Shares”) shall be (x) in the case of (A) a termination of the Executive’s
employment by the Company for Cause or (B) the termination of the Executive’s
employment for any reason (other than the Executive’s death) within one year
following the date of this Agreement, the lower of the Company Common Initial Value
or the Company Preferred Initial Value, as the case may be, of such Called Shares
or the Fair Market Value of such Called Shares on the date of the applicable “Call
Notice” (as defined below).
(ii) The Company may exercise the Call Option by delivering or mailing to the
Executive (or to his estate, if applicable), in accordance with Section 15 of this
Agreement, written notice of exercise (a “Call Notice”). The Call Notice
shall specify the date thereof, the number of Called Shares and the Call Price.
(iii) Within ten (10) days after his receipt of the Call Notice, the Executive
(or his estate) shall tender to the Company, at its principal office the
certificate or certificates representing the Called Shares, duly endorsed in blank
by the Executive (or his estate) or with duly endorsed stock powers attached
thereto, all in form suitable for the transfer of such shares to the Company. Upon
its receipt of such shares, the Company shall pay to the Executive the aggregate
Call Price therefor, in cash or by wire transfer of immediately available funds.
(iv) The Company will be entitled to receive customary representations and
warranties from the Executive (or his estate) regarding the sale of the Called
Shares pursuant to the exercise of the Call Option as may reasonably requested by
the Company, including but not limited to the representation that the Executive has
good and marketable title to the Called Shares to be transferred free and clear of
all liens, claims and other encumbrances.
(v) If the Company delivers a Call Notice, then from and after the time of
delivery of the Call Notice, the Executive shall no longer have any rights as a
holder of the Called Shares subject thereto (other than the right to receive
payment of the Call Price as described above), and such Called Shares shall be
deemed purchased in accordance with the applicable provisions hereof and the
Company shall be deemed to be the owner and holder of such Called Shares.
(vi) Any Company Common Shares as to which the Call Option is not exercised
will remain subject to all terms and conditions of
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this Agreement, including the
continuation of the Company’s right to exercise the Call Option.
(vii) This Section 4(b) is in addition to, and not in lieu of, any rights and
obligations of the Executive and the Company in respect of the Shares contained in
the “Stockholders Agreement” (as defined below). Notwithstanding the above, this
Section 4(b) shall be ineffective as to each Company Common Share on and following
an IPO or any other event which causes the Company Common Stock, or other
securities for which all or substantially all of the Company Common Stock may have
been exchanged, to be or become listed for trading on or over an established
securities market or established trading system.
(c) Put Right.
(i) For a period 10 business days following the termination of the Executive’s
employment with the Company by the Company without Cause within one year of the
date of this Agreement, the Executive shall have the right and option (the “Put
Right”), but not the obligation, to sell to the Company any or all of the shares of
Company Common Stock or Company Preferred Stock, as the case may be, owned by the
Executive. The purchase price (the “Put Price”) of the Company Common Stock or
Company Preferred Stock, as the case may be, subject to purchase under this
provision (the “Put Shares”) shall be the Company Common Initial Value or the
Company Preferred Initial Value, as the case may be, of such Put Shares.
(ii) Within ten (10) days after his written notice of exercise of the Put
Right (the ‘Put Notice”), which Put Notice shall specify the number of Put Shares,
the Executive shall tender to the Company, at its principal office the certificate
or certificates representing the Put Shares, duly endorsed in blank by the
Executive or with duly endorsed stock powers attached thereto, all in form suitable
for the transfer of such shares to the Company. Upon its receipt of such shares,
the Company shall pay to the Executive the aggregate Put Price therefor, in cash or
by wire transfer of immediately available funds.
(iii) The Company will be entitled to receive customary representations and
warranties from the Executive (or his estate) regarding the sale of the Put Shares
pursuant to the exercise of the Put Option as may reasonably requested by the
Company, including but not limited to the representation that the Executive has
good and marketable title to the Put Shares to be transferred free and clear of all
liens, claims and other encumbrances.
(iv) If the Executive delivers a Put Notice, then from and after the time of
delivery of the Put Notice, the Executive shall no
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longer have any rights as a
holder of the Put Shares subject thereto (other than the right to receive payment
of the Put Price as described above), and such Put Shares shall be deemed purchased
in accordance with the applicable provisions hereof and the Company shall be deemed
to be the owner and holder of such Put Shares.
(v) Any Company Common Shares as to which the Put Option is not exercised will
remain subject to all terms and conditions of this Agreement, including the
continuation of the Company’s right to exercise the Call Option.
(vi) This Section 4(c) is in addition to, and not in lieu of, any rights and
obligations of the Executive and the Company in respect of the Shares contained in
the “Stockholders Agreement” (as defined below). Notwithstanding the above, this
Section 4(c) shall be ineffective as to each Company Common Share on and following
an IPO or any other event which causes the Company Common Stock, or other
securities for which all or substantially all of the Company Common Stock may have
been exchanged, to be or become listed for trading on or over an established
securities market or established trading system.
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR THE SECURITIES LAWS OF
ANY STATE. THE SECURITIES MAY NOT BE OFFERED AND SOLD EXCEPT PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER SUCH ACT AND APPLICABLE STATE SECURITIES
LAWS OR PURSUANT TO AN APPLICABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF SUCH ACT AND SUCH LAWS OR PURSUANT TO A WRITTEN
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OPINION OF COUNSEL FOR THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED.
THE SALE, ASSIGNMENT, HYPOTHECATION, PLEDGE, ENCUMBRANCE OR OTHER DISPOSITION (EACH
A “TRANSFER”) AND VOTING OF ANY OF THE SECURITIES REPRESENTED BY THIS
CERTIFICATE ARE RESTRICTED BY THE TERMS OF THE STOCKHOLDERS AGREEMENT, DATED AUGUST
3, 2005, BY AND AMONG THE COMPANY AND THE OTHER PERSONS NAMED THEREIN, AND THE
MANAGEMENT STOCK PURCHASE AGREEMENT, DATED AUGUST 3, 2005, BY AND AMONG THE COMPANY
AND THE OTHER PERSONS NAMED THEREIN, A COPY OF EACH WHICH MAY BE INSPECTED AT THE
COMPANY’S PRINCIPAL OFFICE. THE COMPANY WILL NOT REGISTER THE TRANSFER OF SUCH
SECURITIES ON THE BOOKS OF THE COMPANY UNLESS AND UNTIL THE TRANSFER HAS BEEN MADE
IN COMPLIANCE WITH THE TERMS OF THE STOCKHOLDERS AGREEMENT AND THE MANAGEMENT STOCK
PURCHASE AGREEMENT.
(a) The Executive is acquiring the Shares for his own account and not with a view to, or for
sale in connection with, any distribution of the Shares in violation of the Securities Act or any
rule or regulation under the Securities Act or in violation of any applicable state securities law.
(b) The Executive has had such opportunity as he has deemed adequate to obtain from
representatives of the Company such information as is necessary to permit him to evaluate the
merits and risks of his investment in the Company.
(c) The Executive has sufficient experience in business, financial and investment matters to
be able to evaluate the risks involved in acquiring of the Shares and to make an informed
investment decision with respect to such investment.
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(d) The Executive can afford the complete loss of the value of the Shares and is able to bear
the economic risk of holding such shares for an indefinite period.
(e) The Executive understands that (i) the Shares have not been registered under the
Securities Act and are “restricted securities” within the meaning of Rule 144 under the Securities
Act; (ii) the Shares cannot be sold, transferred or otherwise disposed of unless they are
subsequently registered under the Securities Act or an exemption from registration is then
available; (iii) in any event, the exemption from registration under Rule 144 will not be available
for at least one (1) year and even then will not be available unless a public market then exists
for such shares, adequate information concerning the Company (as applicable) is then available to
the public, and other terms and conditions of Rule 144 are complied with and (iv) there is now no
registration statement on file with the SEC with respect to the Shares and, except as set forth in
Section 5(b) hereof or in the Stockholders Agreement, there is no commitment on the part of the
Company to make any such filing.
(a) If from time to time during the term of this Agreement there is any stock split-up, stock
dividend, stock distribution or other reclassification of the Company Common Stock and/or the
Company Preferred Stock, any and all new, substituted or additional securities to which the
Executive is entitled by reason of his ownership of the Shares shall be immediately subject to the
terms of this Agreement.
(b) If the Company Common Stock and/or the Company Preferred Stock, is converted into or
exchanged for, or stockholders of the Company receive by reason of any distribution in total or
partial liquidation, securities of another corporation, or other property (including cash),
pursuant to any merger of the Company or acquisition of assets, then the rights of the Company
under this Agreement shall inure to the benefit of the Company’s successor and this Agreement shall
apply to the securities or other property received upon such conversion, exchange or distribution
in the same manner and to the same extent as the Shares.
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any party shall operate as a waiver of any other right, or as a waiver of the same right with
respect to any subsequent occasion for its exercise, or as a waiver of any right to damages. No
waiver by any party of any breach of this Agreement shall be held to constitute a waiver of any
other breach or a waiver of the continuation of the same breach.
To the Company:
c/o Clarion Capital Partners, LLC
000 Xxxx 00xx Xxxxxx, Xxxxx 0000
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxx X. Xxxx
with a copy to:
Xxxx, Weiss, Rifkind, Xxxxxxx & Xxxxxxxx LLP
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
To the Executive:
The most recent address for the Executive in the records of the Company or SOI.
The Executive hereby agrees to promptly provide the Company
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and SOI with written
notice of any change in the Executive’s address for so long as this Agreement
remains in effect.
20. GOVERNING LAW; CONSENT TO JURISDICTION. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE AND TO
BE WHOLLY PERFORMED WITHIN THAT STATE. ANY ACTION TO ENFORCE THIS AGREEMENT MUST BE BROUGHT IN A
COURT SITUATED IN, AND THE PARTIES HEREBY CONSENT TO THE JURISDICTION OF, COURTS SITUATED IN NEW
YORK COUNTY, NEW YORK. EACH PARTY HEREBY WAIVES THE RIGHTS TO CLAIM THAT ANY SUCH COURT IS AN
INCONVENIENT FORUM FOR THE RESOLUTION OF ANY SUCH ACTION.