Exhibit 10.15
SHAREHOLDERS' AGREEMENT
SHAREHOLDERS' AGREEMENT dated as of June 19, 2000, among DURASWITCH
INDUSTRIES, INC., a Nevada corporation ("Company"), DELPHI AUTOMOTIVE SYSTEMS
CORPORATION, a Delaware corporation ("Delphi"), and R. XXXXXX XXXXXX, XXXXXXX X.
VAN ZEELAND and XXXXXX X. XXXXXX (collectively, the "Primary Shareholders").
WHEREAS, the Primary Shareholders are the record owners of over 37% of the
outstanding shares of capital stock of Company (the shares of Company capital
stock presently outstanding or Issued from time to time pursuant to securities
exchangeable for such capital stock are referred to as the "Shares");
WHEREAS, Company and Delphi have executed an Option Purchase Agreement
dated April 20, 2000 (the "Option Agreement") granting to Delphi an option to
purchase 1,651,846 shares of capital stock of Company ("Option Shares");
WHEREAS, the Option Agreement requires that this Shareholders' Agreement be
executed if Delphi acquires the Option Shares; and
WHEREAS, concurrently with the execution of this Shareholders' Agreement,
Delphi has purchased the Option Shares.
NOW, THEREFORE, each of the Primary Shareholders and Company covenant and
agree with Delphi as follows:
1. Designees. The Board of Directors of Company shall, at all times during
the term of this Shareholders' Agreement, consist of six members. At the date of
this Agreement, the Board consists of Xxxxxxx X. Peelie, Xxxx X. Xxxx, Xxxxxxx
Van Zeeland, Xxxxxxx X. Van Zeeland, and R. Xxxxxx Xxxxxx. As soon as possible
after Delphi designates in writing to the other parties one individual to be
elected as director of Company, the other parties will use their best efforts to
cause such individual to be elected to fill the sixth position. The Primary
Shareholders will use their best efforts to cause all of the Directors to waive
any Share ownership requirements as to any individual designated as the Delphi
Designee. Thereafter, Delphi will designate in writing to the other parties one
individual to be elected as director of Company, and the Primary Shareholders
(by the majority vote of the Primary Shareholders) will similarly designate in
writing to Delphi and Company three Individuals to be elected as directors of
Company. Each such Individual is hereinafter referred to as a "Designee".
2. Voting of Shares. Delphi and each Primary Shareholder will vote all
Shares owned by them in such manner, and Company, Delphi and the Primary
Shareholders will take such other action as may be necessary;
A. To cause the By-laws of Company to be amended to include the terms
set forth in Schedule I hereto (to the extent such By-laws are not already in
effect):
B. To prevent, without the written consent of Delphi, any amendment to
the Articles of Incorporation or By-laws of Company except as referred to in
clause A above or in Section 8 of this Shareholders' Agreement;
C. Cause the Board of Directors of Company to consist of six members
and to cause one Designee of Delphi (increased to two Designees if Delphi's
ownership interest increases to 20% or greater and Board of Directors increases
to greater than six members) and the three Designees of the Primary Shareholders
to be elected as directors of Company;
D. To prevent Company from taking any action inconsistent with this
Shareholders' Agreement or the Articles of Incorporation or By-laws described
herein
E. To prevent any subsidiary or affiliate of Company from taking,
without the consent of Delphi, any action which, if taken by Company, would
require the prior unanimous consent of the Directors of Company, and
F. Company currently has comprehensive employee benefit plans. The
parties will consider, in good faith, whether any voting provisions are
appropriate relating to significant changes in employee compensation
arrangements.
If, during the period of this Shareholders' Agreement, any Designee ceases to
act as a director for reasons of death, disability, resignation, failure or
refusal to so act or for any other reason, or Delphi or the Primary Shareholders
determine that another person should be named in substitution for one of their
respective Designees theretofore selected, then a successor shall promptly be
designated by the party or parties originally designating the director and the
other parties shall take all available steps necessary to effect such Designee's
prompt election as a director of Company.
3. Transfer of Shares. No Primary Shareholder shall transfer, assign,
pledge, hypothecate, or in any way alienate any Shares (collectively, a
"Transfer"), in any transaction or series of related transactions, representing
4% or more of Company's securities (including as outstanding for purposes of
calculating said 4% all convertible securities, stock options and other
securities that are exchangeable for Shares of Company), whether voluntarily or
by operation of law, or gift or otherwise, to any person or such person's
Associates (as defined in SEC regulations) without first obtaining from the
transferee of such Shares a written agreement ("Transferee Agreement") to be
bound by the obligations of this Shareholders' Agreement to the same extent as
the Primary Shareholder from whom such transferee is acquiring Shares, except
that thereafter this Shareholders' Agreement will apply to any and all Transfers
of such Shares. Company will cause its transfer agent to issue a certificate to
a permitted transferee representing the Shares so Transferred only upon receipt
of a signed original copy of the Transferee Agreement. Any purported Transfer in
violation of this Agreement shall be void and ineffectual, and shall not operate
to transfer any interest or title to the purported transferee.
4. Remedies. The parties agree that damages at law would not be an adequate
remedy for any violation or threatened violation of this Shareholders' Agreement
and that each party will accordingly be entitled to obtain and hereby consents
to injunctive relief, in any court having jurisdiction, restraining the other
party from any such violation or threatened violation and mandating any
affirmative act necessary to permit the consummation of any transaction
contemplated in this Shareholders' Agreement; and each party waives the claim or
defense therein that the other party has an adequate remedy at law, and shall
not urge in any action or proceeding the claim or defense that a remedy at law
exists. Injunctive relief shall not be exclusive of any other remedies, at law
or equity, available to the party seeking such relief upon any violation or
threatened violation of this Shareholders' Agreement.
5. Successors and Assigns. This Shareholders' Agreement shall be binding
upon and shall operate for the benefit of the Primary Shareholders, Company and
Delphi and their respective heirs, executors, administrators, successors and
assigns. Except as otherwise consented to in writing by Delphi, each transferee
of any interest in the Shares owned by the Primary Shareholders (including
securities exchangeable for such Shares) shall be bound by all of the terms of
this Shareholders' Agreement as though specifically named as a Primary
Shareholder herein and as though such transferee were a signatory hereto.
6. Severability. The invalidity or unenforceability of any particular
provision of this Shareholders' Agreement or with respect to any particular
party shall not affect the other provisions hereof or the validity or
enforceability with respect to the other parties, and this Shareholders'
Agreement shall be construed in all respects as if such invalid or unenforceable
provision was omitted or such party was not a signatory.
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7. Counterparts. This Shareholders' Agreement may be executed
simultaneously in two or more counterparts, each of which shall be deemed an
original, but all of which together shall constitute one and the same Agreement.
A copy of this Shareholders' Agreement shall at all times be kept at the
principal office of Company.
8. Termination. This Shareholders' Agreement shall continue in full force
and effect until the 15th anniversary of this Shareholders' Agreement, unless
earlier terminated pursuant to the next sentence of this Section 8, or hereafter
extended by written agreement of the parties. This Shareholders' Agreement shall
automatically terminate upon the earliest of the following events. (i) the date
on which Delphi ceases to hold any Shares or securities exchangeable for Shares;
or (ii) the date on which Delphi acquires at least a 51% ownership interest in
Company. If this Shareholders' Agreement is terminated pursuant to clause (ii)
above, the Primary Shareholders shall take such action as may be necessary to
cause: (a) Company's Articles and By-laws to be amended to require a mere
majority director vote for all matters; and (b) the resignation of an
appropriate number of Primary Shareholders Designees and their replacement by
Delphi Designees.
9. Governing Law. The interpretation, performance and enforcement of this
Agreement shall be governed by the laws of the State of Nevada without resort to
that state's conflict-of-laws principles.
10. Notice. When any notice is required by this Shareholders' Agreement to
be given to a person, such notice shall be provided by first class mail, postage
prepaid, or by facsimile transmission or any other means of physical delivery
reasonably calculated to reach such person-at least as quickly as first class
mail, to the principal executive offices of such person, attention: Corporate
Secretary; or, in the case of the Primary Shareholders, to their addresses set
forth below.
THIS AGREEMENT was executed of the date first set forth above.
DURASWITCH INDUSTRIES, INC. DELPHI AUTOMOTIVE SYSTEMS CORPORATION
By: /s/ R. Xxxxxx Xxxxxx By: /s/ Xxxxx X. Xxxxxxx
------------------------------- ------------------------------------
Xxxxx X. Xxxxxxx
Its: CEO Its: Vice President
------------------------------ -----------------------------------
/s/ R. XXXXXX XXXXXX
----------------------------------------
R. XXXXXX XXXXXX
00000 X. Xxxxxxx Xxxxx, Xxxxxxxx Xxxxx,
Xxxxxxx 00000
/s/ XXXXXXX X. VAN ZEELAND
----------------------------------------
XXXXXXX X. VAN ZEELAND
0000 X. Xxxxxx Xxxxxx, Xxxx,
Xxxxxxx 00000
/s/ XXXXXX X. XXXXXX
----------------------------------------
XXXXXX X. XXXXXX
0000 X. Xxxxxxx Xxxxxx, Xxxx,
Xxxxxxx 00000
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Schedule I
AMENDED AND RESTATED BY-LAWS OF
DURASWITCH INDUSTRIES INC.
In addition to other matters, in form and substance satisfactory to Delphi, the
By-laws will require that the Board of Directors consist of 6 directors (who
need not be residents of the State of Nevada or shareholders of Company) and
will require the unanimous approval of the directors of Company for the
following matters:
(i) Changing the nature of Company's business or expanding or reducing
the scope of Company's operations;
(ii) Amending the Certificate of Incorporation or By-laws of Company;
(iii) The creation of debt or debt obligations exceeding a two to one
ratio of debt to equity;
(iv) Dividends or other distributions absent cumulative, positive
retained earnings.
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