1
EXHIBIT (c)(4)
STOCKHOLDER AGREEMENT
AGREEMENT, dated as of December 15, 1997, among Xxxxxx Services Corp., a
corporation existing under the laws of Ontario ("Parent"), AES Acquisition
Corp., a New York corporation and a wholly owned subsidiary of Parent (the
"Purchaser"), and _________________________________ (the "Stockholder").
W I T N E S S E T H:
WHEREAS, concurrently with the execution and delivery of this Agreement,
Parent, the Purchaser and Advanced Environmental Systems, Inc., a New York
corporation (the "Company"), have entered into an Agreement and Plan of Merger
(as such agreement may hereafter be amended from time to time, the "Merger
Agreement"), pursuant to which Purchaser will be merged with and into the
Company (the "Merger");
WHEREAS, in furtherance of the Merger, Parent and the Company desire that
as soon as practicable (and not later than five business days) after the
execution and delivery of the Merger Agreement, the Purchaser shall commence a
cash tender offer (the "Offer") to purchase at a price of $0.0059 per share all
outstanding shares of Company Common Stock (as defined in Section 1 hereof)
including all of the Shares (as defined in Section 2 hereof) beneficially owned
by the Stockholders; and
WHEREAS, as an inducement and a condition to entering into the Merger
Agreement, Parent has required that the Stockholders agree, and the Stockholder
has agreed, to enter into this Agreement;
NOW, THEREFORE, in consideration of the foregoing and the mutual
representations, warranties, covenants and agreements contained herein, the
parties hereto agree as follows:
1. Definitions. For purposes of this Agreement:
(a) "Beneficially Own" or "Beneficial Ownership" with respect to any
securities shall mean having "beneficial ownership" of such securities (as
determined pursuant to Rule 13d-3 under the Securities Exchange Act of 1934, as
amended (the "Exchange Act")), including pursuant to any agreement, arrangement
or understanding,
2
whether or not in writing. Without duplicative counting of the same securities
by the same holder, securities Beneficially Owned by a Person shall include
securities Beneficially Owned by all other Persons with whom such Person would
constitute a "group" as within the meaning of Section 13(d)(3) of the Exchange
Act.
(b) "Company Common Stock" shall mean at any time the Common Stock, $.0001
par value, of the Company.
(c) "Person" shall mean an individual, corporation, partnership, joint
venture, association, trust, unincorporated organization or other entity.
(d) Capitalized terms used and not defined herein have the respective
meanings ascribed to them in the Merger Agreement.
2. Tender of Shares.
(a) In order to induce Parent and the Purchaser to enter into the Merger
Agreement, the Stockholder hereby agrees to validly tender (or cause the record
owner of such shares to validly tender), and not to withdraw, pursuant to and
in accordance with the terms of the Offer, not later than the fifth business
day after commencement of the Offer pursuant to Section 1.1 of the Merger
Agreement and Rule 14d-2 under the Exchange Act, the number of shares of
Company Common Stock set forth opposite such Stockholder's name on Schedule I
hereto (the "Existing Shares", and together with any shares acquired by such
Stockholder in any capacity after the date hereof and prior to the termination
of this Agreement whether upon the exercise of Company Options or by means of
purchase, dividend, distribution or otherwise, the "Shares"), all of which are
Beneficially Owned by such Stockholder. The Stockholder hereby acknowledges
and agrees that Parent's and the Purchaser's obligation to accept for payment
and pay for the Shares in the Offer, including the Shares Beneficially Owned by
such Stockholder, is subject to the terms and conditions of the Offer.
(b) The transfer by the Stockholder of the Shares to Purchaser in the
Offer shall pass to and unconditionally vest in the Purchaser good and valid
title to the Shares, free and clear of all Liens.
(c) The Stockholder hereby permits Parent and the Purchaser to publish and
disclose in the Offer Documents and, if approval of the Company's stockholders
is
2
3
required under applicable law, the Proxy Statement (including all documents and
schedules filed with the SEC) his identity and ownership of the Company Common
Stock and the nature of his commitments, arrangements and understandings under
this Agreement.
3. [left blank]
4. Additional Agreements.
(a) Voting Agreement. The Stockholder shall, during the period commencing
on the date hereof and continuing until the first to occur of the Effective
Time or the termination of the Merger Agreement in accordance with its terms,
at any meeting of the holders of Company Common Stock, however called, or in
connection with any written consent of the holders of Company Common Stock,
vote (or cause to be voted) the Shares (if any) then held of record or
Beneficially Owned by such Stockholder, (i) in favor of the Merger, the
execution and delivery by the Company of the Merger Agreement and the approval
of the terms thereof and each of the other actions contemplated by the Merger
Agreement and this Agreement and any actions required in furtherance thereof
and hereof; and (ii) against any Acquisition Proposal and against any action or
agreement that would impede, frustrate, prevent or nullify this Agreement, or
result in a breach in any respect of any covenant, representation or warranty
or any other obligation or agreement of the Company under the Merger Agreement
or which would result in any of the conditions set forth in Annex A to the
Merger Agreement or set forth in Article VI of the Merger Agreement not being
fulfilled.
(b) No Inconsistent Arrangements. The Stockholder hereby covenants and
agrees that, except as contemplated by this Agreement and the Merger Agreement,
it shall not (i) transfer (which term shall include, without limitation, any
sale, gift, pledge or other disposition), or consent to any transfer of, any or
all of such Stockholder's Shares, Company Options or any interest therein, (ii)
enter into any contract, option or other agreement or understanding with
respect to any transfer of any or all of such Shares, Company Options or any
interest therein, (iii) grant any proxy, power-of-attorney or other
authorization in or with respect to such Shares or Company Options, (iv)
deposit such Shares or Company Options into a voting trust or enter into a
voting agreement or arrangement with respect to such Shares or Company Options,
or (v) take any other action that would in any way restrict, limit or interfere
with the performance of its
3
4
obligations hereunder or the transactions contemplated hereby or by the Merger
Agreement. Notwithstanding anything contained in this Section to the contrary,
the Stockholder shall have the right to transfer ownership of Shares to members
of his or her immediate family or to a trust created by the Stockholder,
provided that any and all transferees and trustees of any such trusts first
agree in writing to hold such Shares so transferred subject to this Agreement.
(c) [left blank]
(d) No Solicitation. The Stockholder hereby agrees, in its or his
capacity as a stockholder of the Company, that neither such Stockholder nor any
of its Subsidiaries or affiliates shall (and such Stockholder shall use its
best efforts to cause its officers, directors, employees, representatives and
agents, including, but not limited to, investment bankers, attorneys and
accountants, not to), directly or indirectly, encourage, solicit, participate
in or initiate discussions or negotiations with, or provide any information to,
any corporation, partnership, person or other entity or group (other than
Parent, any of its affiliates or representatives) concerning any Acquisition
Proposal. The Stockholder will immediately cease any existing activities,
discussions or negotiations with any parties conducted heretofore with respect
to any Acquisition Proposal. The Stockholder will immediately communicate to
Parent the terms of any proposal, discussion, negotiation or inquiry such
Stockholder, in its or his capacity as a stockholder of the Company, receives
(and will disclose any written materials received by such Stockholder, in its
or his capacity as a stockholder of the Company, in connection with such
proposal, discussion, negotiation or inquiry) and the identity of the party
making such proposal or inquiry which it may receive in respect of any such
transaction.
(e) Company Options. If the Stockholder holds Company Options to acquire
shares of Company Common Stock, it shall, if requested by the Company, consent
to the cancellation or substitution of its Company Options in accordance with
the terms of the Merger Agreement and shall execute all appropriate
documentation in connection with such cancellation or substitution.
(f) Best Reasonable Efforts. Subject to the terms and conditions of this
Agreement, each of the parties hereto agrees to use its best reasonable efforts
to
4
5
take, or cause to be taken, all actions, and to do, or cause to be done, all
things necessary, proper or advisable under applicable laws and regulations to
consummate and make effective the transactions contemplated by this Agreement
and the Merger Agreement. Each party shall promptly consult with the other and
provide any necessary information and material with respect to all filings made
by such party with any Governmental Entity in connection with this Agreement
and the Merger Agreement and the transactions contemplated hereby and thereby.
(g) Waiver of Appraisal Rights. Each Stockholder hereby waives any rights
of appraisal or rights to dissent from the Merger that it or he may have.
(h) Acquisition of Remaining Shares. Parent agrees that, in the event
that within three years following Parent's exercise of the Stock Option,
Parent, the Purchaser or any of their Subsidiaries acquires any additional
shares of Company Common Stock from, or pursuant to an offer made to all of the
Company's stockholders, whether by merger, consolidation, tender offer or other
similar transaction, the price paid per share of Company Common Stock shall be
no less than the Purchase Price.
5. Representations and Warranties of the Stockholder. The Stockholder
hereby represents and warrants to Parent as follows:
(a) Ownership of Shares. Such Stockholder is the record and Beneficial
Owner of the Existing Shares, as set forth on Schedule I opposite such
Stockholder's name. On the date hereof, the Existing Shares constitute all of
the Shares owned of record or Beneficially Owned by such Stockholder. Such
Stockholder has sole voting power and sole power to issue instructions with
respect to the matters set forth in Sections 2, 3 and 4 hereof, sole power of
disposition, sole power of conversion, sole power to demand appraisal rights
and sole power to agree to all of the matters set forth in this Agreement, in
each case with respect to all of the Existing Shares with no limitations,
qualifications or restrictions on such rights, subject to applicable securities
laws and the terms of this Agreement.
(b) Power; Binding Agreement. Such Stockholder has the legal capacity,
power and authority to enter into and perform all of such Stockholder's
obligations under this Agreement. The execution, delivery and performance of
this Agreement by such Stockholder will not violate any
5
6
other agreement to which such Stockholder is a party including, without
limitation, any voting agreement, proxy arrangement, pledge agreement,
shareholders agreement or voting trust. This Agreement has been duly and
validly executed and delivered by such Stockholder and constitutes a valid and
binding agreement of such Stockholder, enforceable against such Stockholder in
accordance with its terms. There is no beneficiary or holder of a voting trust
certificate or other interest of any trust of which such Stockholder is a
trustee whose consent is required for the execution and delivery of this
Agreement or the consummation by such Stockholder of the transactions
contemplated hereby.
(c) No Conflicts. Except for filings under the Exchange Act (if
applicable), (i) no filing with, and no permit, authorization, consent or
approval of, any Governmental Entity for the execution of this Agreement by
such Stockholder and the consummation by such Stockholder of the transactions
contemplated hereby and (ii) none of the execution and delivery of this
Agreement by such Stockholder, the consummation by such Stockholder of the
transactions contemplated hereby or compliance by such Stockholder with any of
the provisions hereof shall (A) conflict with or result in any breach of any
organizational documents applicable to the Stockholder, (B) result in a
violation or breach of, or constitute (with or without notice or lapse of time
or both) a default (or give rise to any third party right of termination,
cancellation, material modification or acceleration) under any of the terms,
conditions or provisions of any note, loan agreement, bond, mortgage,
indenture, license, contract, commitment, arrangement, understanding, agreement
or other instrument or obligation of any kind to which such Stockholder is a
party or by which such Stockholder or any of its properties or assets may be
bound, or (C) violate any order, writ, injunction, decree, judgment, order,
statute, rule or regulation applicable to such Stockholder or any of its
properties or assets.
(d) No Liens. Except as permitted by this Agreement, the Existing Shares
and the certificates representing such Shares are now, and at all times during
the term hereof will be, held by such Stockholder, or by a nominee or custodian
for the benefit of such Stockholder, free and clear of all Liens, proxies,
voting trusts or agreements, understandings or arrangements or any other rights
whatsoever, except for any such Encumbrances or proxies arising hereunder.
6
7
(e) No Finder's Fees. No broker, investment banker, financial advisor or
other person is entitled to any broker's, finder's, financial adviser's or
other similar fee or commission in connection with the transactions
contemplated hereby based upon arrangements made by or on behalf of such
Stockholder.
(f) Reliance by Parent. The Stockholder understands and acknowledges that
Parent is entering into, and causing Purchaser to enter into, the Merger
Agreement in reliance upon such Stockholder's execution and delivery of this
Agreement.
6. Representations and Warranties of Parent and the Purchaser. Each of
Parent and the Purchaser hereby represents and warrants to the Stockholder as
follows:
(a) Power; Binding Agreement. Parent and the Purchaser each has the
corporate power and authority to enter into and perform all of its obligations
under this Agreement. The execution, delivery and performance of this
Agreement by each of Parent and the Purchaser will not violate any other
agreement to which either of them is a party. This Agreement has been duly and
validly executed and delivered by each of Parent and the Purchaser and
constitutes a valid and binding agreement of each of Parent and the Purchaser,
enforceable against each of Parent and the Purchaser in accordance with its
terms.
(b) No Conflicts. Except for filings under the Exchange Act (if
applicable), (i) no filing with, and no permit, authorization, consent or
approval of, any Governmental Entity is necessary for the execution of this
Agreement by each of Parent and the Purchaser and the consummation by each of
Parent and the Purchaser of the transactions contemplated hereby and (ii) none
of the execution and delivery of this Agreement by each of Parent and the
Purchaser, the consummation by each of Parent and the Purchaser of the
transactions contemplated hereby or compliance by each of Parent and the
Purchaser with any of the provisions hereof shall (A) conflict with or result
in any breach of any organizational documents applicable to either of Parent or
the Purchaser, (B) result in a violation or breach of, or constitute (with or
without notice or lapse of time or both) a default (or give rise to any third
party right of termination, cancellation, material modification or
acceleration) under any of the terms, conditions or provisions of any note,
loan agreement, bond, mortgage, indenture, license, contract, commitment,
7
8
arrangement, understanding, agreement or other instrument or obligation of any
kind to which either of Parent or the Purchaser is a party or by which either
of Parent or the Purchaser or any of their properties or assets may be bound,
or (C) violate any order, writ, injunction, decree, judgment, order, statute,
rule or regulation applicable to either of Parent or the Purchaser or any of
their properties or assets.
7. Further Assurances. From time to time, at the other party's request
and without further consideration, each party hereto shall execute and deliver
such additional documents and take all such further lawful action as may be
necessary or desirable to consummate and make effective, in the most
expeditious manner practicable, the transactions contemplated by this
Agreement.
8. Stop Transfer. Each Stockholder shall not request that the Company
register the transfer (book-entry or otherwise) of any certificate or
uncertificated interest representing any of the Shares, unless such transfer is
made in compliance with this Agreement. In the event of a stock dividend or
distribution, or any change in the Company Common Stock by reason of any stock
dividend, split-up, recapitalization, combination, exchange of shares or the
like, the term "Shares" shall refer to and include the Shares as well as all
such stock dividends and distributions and any shares into which or for which
any or all of the Shares may be changed or exchanged.
9. Termination. Except as provided in Section 3 hereof, the covenants,
agreements and proxy shall terminate upon the termination of the Merger
Agreement in accordance with its terms.
10. Miscellaneous.
(a) Entire Agreement. This Agreement constitutes the entire agreement
between the parties with respect to the subject matter hereof and supersedes
all other prior agreements and understandings, both written and oral, between
the parties with respect to the subject matter hereof.
(b) Binding Agreement. This Agreement and the obligations hereunder shall
attach to the Shares and shall be binding upon any person or entity to which
legal or beneficial ownership of such Shares shall pass, whether by operation
of law or otherwise, including, without limitation, a Stockholder's heirs,
guardians, administrators or
8
9
successors. Notwithstanding any transfer of Shares, the transferor shall
remain liable for the performance of all obligations of the transferor under
this Agreement.
(c) Assignment. This Agreement shall not be assigned by operation of law
or otherwise without the prior written consent of the other parties, provided
that Parent may assign, in its sole discretion, its rights and obligations
hereunder to any direct or indirect wholly owned subsidiary of Parent, but no
such assignment shall relieve Parent of its obligations hereunder if such
assignee does not perform such obligations.
(d) Amendments, Waivers, Etc. This Agreement may not be amended, changed,
supplemented, waived or otherwise modified or terminated, except upon the
execution and delivery of a written agreement executed by the parties hereto.
(e) Notices. All notices, requests, claims, demands and other
communications hereunder shall be in writing and shall be given (and shall be
deemed to have been duly received if given) by hand delivery or telecopy (with
a confirmation copy sent for next day delivery via courier service, such as
Federal Express), or by any courier service, such as Federal Express, providing
proof of delivery. All communications hereunder shall be delivered to the
respective parties at the following addresses:
If to the
Stockholders: c/o Advanced Environmental Systems, Inc.
000 00xx Xxxxxx
Xxxxxx, Xxxxxxxx 00000
Attention: Xxxx Xxxxxxx, Vice President
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Copy to: Waldbaum, Corn, Xxxx, Xxxxxx & Xxxxx P.C.
000 Xxxx Xxxxxxxxxxx Xxxxxx
Xxxxx 000
Xxxxxx, Xxxxxxxx 00000
Attention: Xxxxxxx X. Xxxx
Telephone No.: (000) 000-0000
Facsimile: (000) 000-0000
9
10
If to Parent or
the Purchaser: Xxxxxx Services Corp.
000 Xxxx Xxxxxx Xxxx
X.X. Xxx 0000, LCD #1
Hamilton, Ontario
L8N 4J6
Attention: Xxx Xxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Copy to: Skadden, Arps, Slate,
Xxxxxxx & Xxxx LLP
Suite 1820, North Tower
Box 000, Xxxxx Xxxx Xxxxx
Xxxxxxx, Xxxxxxx
X0X 0X0
Attention: Xxxxxxxxxxx X. Xxxxxx
Telephone No.: (000) 000-0000
Telecopy No.: (000) 000-0000
or to such other address as the person to whom notice is given may have
previously furnished to the others in writing in the manner set forth above.
(f) Severability. Whenever possible, each provision or portion of any
provision of this Agreement will be interpreted in such manner as to be
effective and valid under applicable law but if any provision or portion of any
provision of this Agreement is held to be invalid, illegal or unenforceable in
any respect under any applicable law or rule in any jurisdiction, such
invalidity, illegality or unenforceability will not affect any other provision
or portion of any provision in such jurisdiction, and this Agreement will be
reformed, construed and enforced in such jurisdiction as if such invalid,
illegal or unenforceable provision or portion of any provision had never been
contained herein.
(g) Specific Performance. Each of the parties hereto recognizes and
acknowledges that a breach by it of any covenants or agreements contained in
this Agreement will cause the other party to sustain damages for which it would
not have an adequate remedy at law for money damages, and therefore in the
event of any such breach the aggrieved party shall be entitled to the remedy of
specific performance of such covenants and agreements and injunctive and other
equitable relief in addition to any
10
11
other remedy to which it may be entitled, at law or in equity.
(h) Remedies Cumulative. All rights, powers and remedies provided under
this Agreement or otherwise available in respect hereof at law or in equity
shall be cumulative and not alternative, and the exercise of any thereof by any
party shall not preclude the simultaneous or later exercise of any other such
right, power or remedy by such party.
(i) No Waiver. The failure of any party hereto to exercise any right,
power or remedy provided under this Agreement or otherwise available in respect
hereof at law or in equity, or to insist upon compliance by any other party
hereto with its obligations hereunder, and any custom or practice of the
parties at variance with the terms hereof, shall not constitute a waiver by
such party of its right to exercise any such or other right, power or remedy or
to demand such compliance.
(j) No Third Party Beneficiaries. This Agreement is not intended to be
for the benefit of, and shall not be enforceable by, any person or entity who
or which is not a party hereto.
(k) Governing Law. This Agreement shall be governed and construed in
accordance with the laws of the State of New York, without giving effect to the
principles of conflicts of law thereof.
(l) Jurisdiction. Each party hereby irrevocably submits to the exclusive
jurisdiction of the Courts of the State of New York and the United States
District Court for the Southern District of New York in any action, suit or
proceeding arising in connection with this Agreement, and agrees that any such
action, suit or proceeding shall be brought only in such court (and waives any
objection based on forum non conveniens or any other objection to venue
therein). Each party hereto hereby waives any right to a trial by jury in
connection with any such action, suit or proceeding.
(m) Descriptive Headings. The descriptive headings used herein are
inserted for convenience of reference only and are not intended to be part of
or to affect the meaning or interpretation of this Agreement.
(n) Counterparts. This Agreement may be executed in counterparts, each of
which shall be deemed to be
11
12
an original, but all of which, taken together, shall constitute one and the
same Agreement.
IN WITNESS WHEREOF, Parent, the Purchaser and the Stockholder have caused
this Agreement to be duly executed as of the day and year first above written.
12
13
XXXXXX SERVICES CORP.
By:________________________________
Name:
Title:
AES ACQUISITION CORP.
By:________________________________
Name:
Title:
__________________________________
(Name of Stockholder)
By:________________________________
Name:
Title:
13
14
Schedule I
Number of Shares
and Company Options
Name of Stockholder Beneficially Owned
------------------- -----------------------
Shares Options
------ -------
14
