Exhibit 4.2 Shareholder Agreement Dated as of April 14, 1998
SHAREHOLDER AGREEMENT
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THIS AGREEMENT is made and entered this 14th day of April, 1998, by and
among Nationwide Electric, Inc., a Delaware corporation (the "Company"), and the
following shareholders of the Company, hereinafter sometimes referred to
collectively as "Shareholders" or individually as "Shareholder": KLT Energy
Services Inc. ("KLT"), Xxxxxxxxx X. Xxxxx XX ("Green"), Xxxxx X. Xxxxx
("Xxxxx"), Xxxxx Xxxxx ("Xxxxx"), Xxxx Xxxx ("Xxxx") and Xxxxxxx Capital, L.L.C.
("Xxxxxxx").
RECITALS
A. The Shareholders own, directly or indirectly, all of the issued and
outstanding shares of Common Stock and Class A Nonvoting Common Stock of the
Company.
B. The Company and Shareholders believe it is in the best interests of
the Company and the Shareholders to make certain provisions for the future
registration and voting of the shares of capital stock of the Company which
Green, Clark, Xxxxx and Xxxx now own or may hereafter acquire (the "Shares").
NOW, THEREFORE, in consideration of the mutual covenants and promises
contained herein, and other good and valuable consideration, the receipt of
which is hereby acknowledged, the Shareholders and the Company agree as follows:
1. Scope of Agreement.
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This Agreement shall apply to all Shares now owned or hereafter
acquired by Green, Clark, Xxxxx and Wood.
2. Transferees Bound.
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Each transferee of any of the Shares, or any interest therein, shall
own such Shares or such interest subject to all of the terms and provisions of
this Agreement including the restrictions on transfer as provided in this
Agreement. The term "Shareholder" as defined herein shall be deemed to include
any and all such transferees, unless the context indicates otherwise. Each
certificate representing any of the Shares, when issued shall bear a legend to
the following effect in addition to such other legends as may be appropriate to
reflect certain restrictions on transferability imposed under any applicable
subscription agreement, federal and state securities laws:
THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT THE TERMS OF THAT
CERTAIN SHAREHOLDER AGREEMENT DATED APRIL __, 1998, BETWEEN THE COMPANY AND
ITS SHAREHOLDERS AND WHICH AGREEMENT MAY BE EXAMINED AT THE PRINCIPAL
OFFICES OF THE COMPANY.
3. Registration Rights.
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(a) In the event the Board of Directors of the Company votes to offer
any common stock to the public through a public offering, the Company hereby
agrees at its sole cost and expense, to cause any and all Shares owned by Green,
Clark, Xxxxx and Xxxx at any time within thirty (30) days following such vote,
to be registered with the Securities and Exchange Commission subject only to
such restrictions as shall be imposed on all other Shareholders and such
restrictions as required by the underwriters of such public offering (which
shall be applied to all common stock owned by the Shareholders as of the public
offering). If the public offering underwriter(s) advises the Company that
marketing factors require a limitation of the number of shares to be
underwritten, then the number of shares owned by the Shareholders that may be
included in the registration and underwriting shall be allocated among all
Shareholders in proportion, as nearly as practicable, to the respective amounts
of shares held by the Shareholders at the time of filing the registration
statement. No shares held by the Shareholders excluded from the underwriting by
reason of the underwriters' marketing limitation shall be included in such
registration. Notwithstanding anything to the contrary herein, the Shareholders
acknowledge that Galt Financial, Inc. has been issued common stock by the
Company, which common stock shall be registered in connection with the initial
public offering of the Company's common stock, and which may be subject to
different, and more favorable, restrictions than those imposed upon the
Shareholders. The Company and Shareholders agree to execute such amendments to
this Agreement, any stock purchase or option agreement, or any other agreement
respecting the Shares as may be required by said underwriters.
(b) The Company will indemnify the Shareholders each of its officers,
directors and partners, and each person controlling the Shareholders within the
meaning of Section 15 of the Act (collectively the "Indemnified Parties"), with
respect to which registration has been effected pursuant to this Paragraph 3,
against all expenses, claims, losses, damages or liabilities (or actions in
respect thereof), including any of the foregoing incurred in settlement of any
litigation, commenced or threatened, arising out of or based on any untrue
statement (or alleged untrue statement) of a material fact contained in any
registration statement, prospectus, offering circular or other document, or any
amendment or supplement thereto, incident to any such registration,
qualification or compliance, or based on any omission (or alleged omission) to
state therein a material fact required to be stated therein or necessary to make
the statements therein, in light of the circumstances in which they were made,
not misleading, or any violation by the Company of the Act or any state
securities laws in connection with any such registration. The Company will
reimburse the Indemnified Parties for any legal and any other expenses
reasonably incurred in connection with investigating, preparing or defending any
such claim, loss, damage, liability or action, provided that the Company will
not be liable in any such case to the extent that any such claim, loss, damage,
liability or expense arises out of or is based on any untrue statement or
omission or alleged untrue statement or omission, made in reliance upon and in
conformity with written information furnished to the Company by an instrument
duly executed by the Indemnified Parties and stated to be specifically for use
therein.
(c) The registration rights granted by this Paragraph 3 may not be
transferred by a Shareholder under any circumstances (except pursuant to a
permitted transfer under the applicable subscription agreement between that
Shareholder and the Company).
4. Proxies.
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Until the closing of the initial registered public offering of the
Company's common stock, each of Green, Clark, Xxxxx and Wood shall execute and
deliver to KLT and Xxxxxxx, respectively, irrevocable proxies each covering one-
half of the Shares now or hereafter owned by said Green, Clark, Xxxxx and Wood.
Any permitted transferee of any of the Shares shall, as a condition to such
transfer, execute and deliver to KLT and Xxxxxxx, respectively, irrevocable
proxies each covering one-half of the Shares now or hereafter owned by said
transferee. Said proxies are deemed coupled with an interest sufficient in law
to make such proxies irrevocable. KLT and Xxxxxxx may vote the Shares covered by
said proxies in any manner they deem appropriate, in their individual judgments,
subject to any agreements or other arrangements between them.
5 Termination.
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(a) This Agreement and all restrictions on the transfer of Shares
created hereby shall terminate on the occurrence of any of the following events:
(a) The bankruptcy or dissolution of the Company.
(b) A single Shareholder becoming the owner of all of the Shares
of the Company, which are then subject to this Agreement.
(c) The execution of a written instrument by the Company and all
of the Shareholders who then own Shares subject to this Agreement which
terminates the same.
(b) The termination of this Agreement for any reason shall not
affect any right or remedy existing hereunder prior to the effective date of its
termination.
6. General Provisions.
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(a) Governing Law. This Agreement shall be construed pursuant to the
laws of the State of Missouri, without giving effect to that State's conflict of
laws provisions.
(b) Definitions. Unless the context otherwise requires, the words
"Shareholder" and "Shareholders" shall for all purposes of this Agreement mean
and include all of the parties hereto other than the Company and all persons to
whom Shares may hereafter be transferred. Furthermore, the term "Shareholder"
shall also include any individual who holds title to his Shares in a revocable
inter vivos trust. The term "Shares" applies to any class of shares which the
Company now or hereafter is authorized to issue.
(c) Remedies for Breach. The Shareholders expressly recognize and
agree that violation of the terms and provisions in this Agreement, including
without limitation, those relating to the execution and delivery of proxies, may
cause irreparable damage to Company or the other Shareholders, which may not be
adequately compensated by monetary damages. In the event of a breach or
threatened breach by any Shareholders of the provisions of this Agreement, the
Company
and the other Shareholders, in addition to and not in limitation of any other
rights, remedies or damages available to the Company or other Shareholders at
law or in equity, shall be entitled to a permanent injunction in order to
prevent or to restrain any such breach by a Shareholder or by such Shareholder's
partners, agents, representatives, servants, employees or transferees. The
Shareholders expressly recognize and agree that such injunctive relief shall be
in addition to all other rights and remedies available under applicable law.
(d) Notices. All notices provided for by this Agreement shall be made
in writing (1) either by actual delivery or (2) by mailing of the notice in the
United States mail to the last known address of the party entitled thereto,
registered or certified mail, return receipt requested.
(e) Amendment. This Agreement may be amended or altered only by the
execution of a written instrument by the Company and all the Shareholders who
then own Shares of the Company.
(f) Descriptive Headings. Titles to paragraphs are for information
purposes only.
(g) Binding Effect. This Agreement is binding upon and inures to the
benefit of the Company, its successors, assigns, and transferees, and to the
Shareholders and their respective heirs, personal representatives, successors
and permitted assigns and transferees.
(h) Arbitration. All claims, counterclaims, disputes and other
matters in question between the parties hereto arising out of or relating to
this Agreement or the breach thereof will be decided by arbitration in
accordance with the Commercial Arbitration Rules of the American Arbitration
Association then obtaining, subject to the limitations and restrictions stated
in paragraphs (ii) and (iii) below. This Agreement so to arbitrate and any other
agreement or consent to arbitrate entered into in accordance herewith as
provided in this subsection will be specifically enforceable under the
prevailing law of any court having jurisdiction.
(i) Notice of demand for arbitration must be filed in writing
with the other parties to this Agreement and with the American Arbitration
Association. The arbitration shall be conducted in Kansas City, Missouri. The
demand must be made within a reasonable time after the claim, dispute or other
matter in question has arisen. In no event may the demand for arbitration be
made after the date when institution of legal or equitable proceedings based on
such claim, dispute or other matter in question would be barred by the
applicable statute of limitations.
(ii) All demands for arbitration and all answering statements
thereto which include any monetary claim must contain a statement that the total
sum or value in controversy as alleged by the party making such demand or
answering statement is not more than $200,000 (exclusive of interest and costs).
The arbitrators will not have jurisdiction, power or authority to render a
monetary award in response thereto against any party which totals more than
$200,000 (exclusive of interest and costs). The arbitrators will not have
jurisdiction, power or authority to consider, or make findings (except in denial
of their own jurisdiction) concerning any claim, counterclaim, dispute or other
matter in question where the amounts in controversy of any such claim, counter-
claim, dispute or matter is more than $200,000 (exclusive of interest and
costs).
(iii) No arbitration arising out of, or relating to, this
Agreement may include, by consolidation, joinder or in any other manner, any
person or entity who is not a party to this Agreement.
(iv) By written consent signed by all the parties to this
Agreement and containing a specific reference hereto, the limitations and
restrictions contained in paragraphs (ii) and (iii) above may be waived in whole
or in part as to any claim, counterclaim, dispute or other matter specifically
described in such consent. No consent to arbitration in respect of a
specifically described claim, counterclaim, dispute or other matter in question
will constitute consent to arbitrate any other claim, counterclaim, dispute or
other matter in question which is not specifically described in such consent or
in which the sum or value in controversy exceeds $200,000 (exclusive of interest
and costs) or which is with any party not specifically described therein.
(v) The award rendered by the arbitrators will be final,
judgment may be entered upon it in any court having jurisdiction thereof, and
will not be subject to modification or appeal except to the extent permitted by
Sections 10 and 11 of the Federal Arbitration Act (9 U.S.C. (S)(S) 10, 11).
(i) Choice of Venue. All actions or proceedings with respect to this
Agreement shall be instituted only in any state or federal court sitting in
Xxxxxxx County, Missouri, and by execution and delivery of this Agreement, the
parties irrevocably and unconditionally subject to the jurisdiction (both
subject matter and personal) of each such court and irrevocably and
unconditionally waive: (a) any objection that the parties might now or hereafter
have to the venue of any of such court; and (b) any claim that any action or
proceeding brought in any such court has been brought in an inconvenient forum.
THIS CONTRACT CONTAINS A BINDING ARBITRATION PROVISION WHICH MAY BE
ENFORCED BY THE PARTIES.
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IN WITNESS WHEREOF, the Company and the Shareholders have executed this
Agreement on the day and year above written.
ATTEST: Nationwide Electric, Inc.
/s/ Xxxx X. English , Secretary /s/ Xxxxxxx X. Xxxxx
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Xxxxxxx X. Xxxxx, Chairman of the Board
SHAREHOLDERS:
KLT Energy Services Inc.
/s/ Xxxx X. English , Secretary /s/ Xxxxxxx X. Xxxxx
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Xxxxxxx X. Xxxxx, President
Xxxxxxx Capital, L.L.C.
/s/ Xxxxxxx X. Xxxxx
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Xxxxxxx X. Xxxxx, Member
/s/ Xxxxxxxxx X. Xxxxx
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Xxxxxxxxx X. Xxxxx XX
/s/ Xxxxx X. Xxxxx
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Xxxxx X. Xxxxx
/s/ Xxxxx Xxxxx
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Xxxxx Xxxxx
/s/ Xxxx Xxxx
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Xxxx Xxxx
