Exhibit b-131
STOCKHOLDERS AGREEMENT
THIS STOCKHOLDERS AGREEMENT is made and entered into this
29th day of May, 1998, by and among X. X. Xxxxxxx Enterprises,
Inc., a Delaware corporation (the "Company"), Home Services
Solutions Inc., a Missouri corporation ("Home Service") and R.
Xxxxxxx Xxxxxxx ("Xxxxxxx"), a Georgia resident, individually and
in his capacity as Voting Trustee and shareholder's
representative under the Voting Trust (as defined below). For
purposes of this Agreement, Home Service and Xxxxxxx shall
hereinafter individually be referred to as a "Stockholder" and
collectively be referred to as the "Stockholders."
RECITALS
A. Home Service currently owns 15,000,000 shares of the
Company's Series A Convertible Preferred Stock, par value $0.001
per share, and Xxxxxxx owns, individually and in his capacity as
Voting Trustee, 15,000,000 shares of the Company's Common Stock,
par value $0.001 per share;
X. Xxxxxxx is the Voting Trustee and shareholder's
representative under a Voting Trust Agreement dated May 22, 1998,
a copy of which is attached hereto as Exhibit A, concerning
certain shares of Common Stock of the Company ("Voting Trust")
under which Xxxxxxx solely controls the voting of such shares for
a period of ten (10) years and which results in Xxxxxxx currently
being able to vote all of the issued and outstanding shares of
Common Stock of the Company.
C. The shares of capital stock that can be voted by Home
Service and Xxxxxxx (either individually or under the Voting
Trust) constitute one hundred percent (100%) of the issued and
outstanding capital stock of the Company, and shall hereinafter
be referred to as the "Shares."
D. The Company, Home Service and Xxxxxxx believe it is in
the best interests of the Company that the management of the
Company be conducted in an orderly manner as hereinafter
provided.
E. The Company, Home Service and Xxxxxxx further believe
it is in the best interests of the Company and the Stockholders
to make provision for the future disposition of the shares of
capital stock of the Company which the Stockholders now own or
may hereafter acquire.
NOW, THEREFORE, for and in consideration of the mutual
covenants and promises contained herein, and other good and
valuable consideration, the receipt and legal sufficiency of
which are hereby acknowledged, the Stockholders and the Company
agree as follows:
1. Scope of Agreement. This Agreement shall apply to all
Shares and to all other shares of capital stock of the Company
that become issued and outstanding in the future (the "Future
Shares"). Each Stockholder covenants, promises and agrees that
he or it will not, voluntarily or involuntarily, by operation of
law or otherwise, whether outright or as security, sell, assign,
transfer, mortgage, pledge, hypothecate or otherwise encumber or
dispose of (hereinafter collectively referred to as a
"Transfer"), with or without consideration, any or all of the
Shares or Future Shares, except for the deposit by Xxxxxxx of
certain Shares in escrow pursuant to the Escrow Agreement of even
date herewith between Home Service, Xxxxxxx and SunTrust Bank,
Atlanta, a Georgia banking corporation, as escrow agent (the
"Escrow Agreement"), and except as permitted by this Agreement
and in accordance with its terms. Any Transfer of a
Stockholder's Shares or Future Shares, or any part thereof,
although permitted under this Agreement, shall be deemed invalid,
null and void, and of no force or effect, unless and until the
transferee of such Shares or Future Shares shall have agreed in
writing to the provisions of this Agreement, or unless such
Transfer is permitted free and clear of restrictions pursuant to
a separate written agreement of all Stockholders. The Company
shall not permit the Transfer of any Shares or Future Shares to
be made on the books of the Company unless the Transfer is
permitted by this Agreement and is made in accordance with its
terms, and any Transfer not permitted by this Agreement or not
made in accordance with its terms shall be deemed invalid, null
and void, and of no force or effect. The restrictions on
Transfer of any Shares or Future Shares shall not be applicable
to any Transfer expressly permitted under the Escrow Agreement or
under that certain Employment Agreement of even date herewith
between the Company and Xxxxxxx (the "Employment Agreement"), or
to any Transfer resulting from the Stockholders' exercise of
their respective rights under the Registration Rights Agreement
(defined below).
2. Board of Directors.
(a) Board Composition. During the term of this
Agreement, the Stockholders hereby agree that the Board of
Directors of the Company shall initially be composed of five (5)
members. Further, the Stockholders agree that the Board of
Directors will always consist of an odd number of Directors and
that the size of the Board of Directors shall not be changed
without the express written consent of both Home Service and
Xxxxxxx.
(b) Home Service Board Representation. Home Service
shall have the right, power and authority to nominate for
election two (2) members (the "Home Service Directors") to the
Company's Board of Directors at any annual or special meeting of
the Stockholders, and Xxxxxxx (and any other Stockholders) hereby
agree to take such action as may be necessary to cause the
election of the Home Service Directors in accordance with the
terms of this Agreement.
(c) Xxxxxxx Board Representation. Xxxxxxx shall have
the right, power and authority to nominate for election two (2)
members (the "Xxxxxxx Directors") to the Company's Board of
Directors at any annual or special meeting of the Stockholders,
and Home Service (and any other Stockholders) hereby agree to
take such action as may be necessary to cause the election of the
Xxxxxxx Directors in accordance with the terms of this Agreement.
(d) Independent Director. Xxxxxxx shall have the sole
right, power and authority to nominate for election one (1)
member (the "Independent Director") to the Company's Board of
Directors at any annual or special meeting of the Stockholders.
If Home Service does not agree to such nomination, Xxxxxxx shall
continue to nominate one (1) member until such member is approved
by Home Service. The parties agree that once such member's
nomination is approved by Home Service, the Stockholders shall
take such action as may be necessary to cause the election of
such member.
(e) Procedure for Election. The Company shall provide
to each party entitled to nominate for election members of the
Board of Directors under Sections 2(b)-(d) prior written notice
of any intended mailing of notice to Stockholders for a meeting
at which Directors are to be elected, and any party entitled to
nominate for election Directors under Sections 2(b)-(d) shall
notify the Company in writing, prior to such mailing, of the
person(s) designated by it or them as its or their nominee(s) for
election as Director(s). At each annual meeting of the
Stockholders, at each special meeting of the Stockholders
involving the election of Directors of the Company, and at each
other time at which the Stockholders will have the right to, or
will, vote for or render consent in writing regarding the
election of Directors of the Company, then and in each such
event, the Stockholders covenant and agree to vote all of the
Shares and Future Shares to cause and maintain the election to
the Board of Directors of the Company of the Home Service
Directors, the Xxxxxxx Directors, the Independent Director, and
no others.
(f) Change in Number of Directors. If the number of
members of the Board of Directors of the Company is changed,
then, notwithstanding the provisions of Sections 2(b) and 2(c)
above, each of Home Service and Xxxxxxx shall have the right,
power and authority to nominate for election an equal number of
members of the Board of Directors (totaling one (1) less than the
number of Directors, as changed), pursuant to the terms of this
Section 2, and Xxxxxxx shall have the sole right, power and
authority to nominate for election the other member of the Board
of Directors.
(g) Removal, Resignation and Vacancy of Directors. No
Stockholder shall vote or take any other action to remove any
Director that was nominated for election by the other
Stockholders, except as provided below. In the event either Home
Service or Xxxxxxx desires to remove a Director that has been
elected as its own nominee to the Board of Directors of the
Company, the other Stockholders shall vote for or consent to such
removal. In the event a vacancy in the office of a Director is
caused by death, resignation, retirement or removal of a
Director, the vacancy shall be filled by appointing or electing
the nominee of the Stockholder who had nominated for election the
Director whose death, resignation, retirement or removal caused
such vacancy, all in accordance with the terms of this Agreement,
and the other Stockholders shall take such action as may be
necessary to cause the election of such new number.
(h) Required Votes; Location of Meetings. Except as
otherwise required by this Agreement, or applicable law, all
actions of the Board of Directors shall be accomplished by the
vote of at least a simple majority of all of the members of the
Board of Directors. All meetings of the Board of Directors shall
take place at a location mutually agreeable to the Stockholders.
(i) Expense Reimbursement and D&O Insurance. The
Company hereby agrees to reimburse all reasonable expenses
incurred by the members of the Board of Directors for expenses
related to attendance and participation at meetings of the Board
of Directors, but only upon due verification and documentation of
such expenses. The Company shall also provide, if reasonably
available, and at no cost to the individuals serving on its Board
of Directors, directors and officers liability insurance.
3. Super-Majority Vote. The Stockholders and the Company
agree that, except as otherwise provided in Section 7 below, the
Company shall not take any of the following actions without the
affirmative vote or consent of at least eighty percent (80%) of
the members of the Board of Directors (and, to the extent
Delaware law requires stockholder approval to take such action,
without affirmative vote or consent of at least eighty percent
(80%) of the issued and outstanding capital stock of the
Company):
(a) amend, repeal or alter in any way the Certificate
of Incorporation or Bylaws of the Company or any of its
subsidiaries;
(b) merge or consolidate or agree to merge or
consolidate the Company with or into any other legal entity, or
convert the Company into any other legal entity, or authorize a
share exchange;
(c) liquidate, dissolve, reorganize or recapitalize
the Company or adopt any plan to do so;
(d) issue, sell or seek to register for a public
offering any shares of capital stock of the Company or any
options or rights to purchase any shares of capital stock of the
Company, whether or not such shares have been previously
authorized or issued, except for performing its obligations under
Section 1.2(b) of the Stock Purchase Agreement by and among
Company, Home Service and Xxxxxxx dated May 29, 1998 ("Stock
Purchase Agreement"), and performing its obligations under that
certain Registration Rights Agreement (the "Registration Rights
Agreement") of even date herewith by and between the Company,
Xxxxxxx and Home Service;
(e) declare or pay any dividends on, or make any other
distributions upon or in respect of, or purchase, retire or
retain any shares of the capital stock of the Company, or set
aside any funds for such purposes except as otherwise set forth
in the Employment Agreement between the Company and Xxxxxxx, or
in Section 1.3(a) of the Stock Purchase Agreement;
(f) except as provided in the annual capital budget of
the Company approved by the Board of Directors, make any capital
expenditures or any capital additions or improvements requiring
the payment of more than an agreed to amount for any one capital
addition or improvement, or an aggregate of more than an agreed
to amount in any 12-month period for all capital additions and
improvements, except as may be involved in ordinary repairs,
maintenance and replacement and minor plant and equipment
additions;
(g) acquire any stock or assets of any legal entity or
invest in or acquire any interest in any business enterprise;
(h) sell, lease, exchange, transfer or otherwise
dispose of (1) all or substantially all the tangible, intangible
or other assets of the Company or of any of its subsidiaries, or
(2) all or substantially all of the trademarks, trade names,
licenses, copyrights, patents, patent applications and other
intellectual property owned or used by the Company or any of its
subsidiaries, or (3) any stock of any other corporation or any
investment or interest in any business enterprise, or (4) any
other asset of the Company except in the ordinary course of
business;
(i) approve or ratify the initial operating budget of
the Company, including, without limitation, appropriations for
advertising and promotional expenses;
(j) approve payment of the salary to be paid to each
member of the Board of Directors or executive officer directly
involved in operations, marketing, finance or acquisitions for
the Company except for Xxxxxxx' salary and compensation, as
agreed to in the Employment Agreement;
(k) agree to pay, conditionally or otherwise, any
bonus, extra compensation, pension or any severance pay to any
directors or executive officers directly involved in operations,
marketing, finance or acquisitions for the Company or increase
the compensation paid by the Company to any of its executive
officers directly involved in operations, marketing, finance or
acquisitions for the Company except for Xxxxxxx' salary and
compensation, as agreed to in the Employment Agreement;
(l) increase or decrease, by resolution or otherwise,
the number of directors constituting the entire Board of
Directors;
(m) hire any professionals, including investment
bankers, accountants or attorneys other than professionals needed
only for the day to day operations of the business of the
Company;
(n) request any additional capital contribution from
its stockholders; or
(o) form an executive committee under the Bylaws of
the Company.
4. Right of First Refusal.
(a) If any Stockholder shall make or receive a bona
fide written offer (the "Transferee Offer"), to or from a third
party (the "Transferee") for the purchase of all of the Shares or
Future Shares owned by him or it (the "Offered Shares"), which
such Stockholders (hereinafter referred to as the "Selling
Stockholder") or the Transferee desires to accept, the Company
and the other Stockholders (the "Non-Offering Stockholders")
shall have the option (the "Option"), as hereinafter described,
to collectively purchase all of the Offered Shares. The Selling
Stockholder shall not be eligible to vote his or its Shares or
Future Shares, or to cause the Directors nominated for election
by him or it to vote, in favor of or against the exercise by the
Company of its Option to purchase the Offered Shares.
(b) The Option price for the Offered Shares shall be
the price contained in the Transferee Offer and shall be paid in
cash.
(c) The Company shall have the initial opportunity to
purchase all, but not less than all, of the Offered Shares. The
Selling Stockholder shall give the Company and the Non-Offering
Stockholders written notice (the "Notice") within thirty (30)
days after the making or receipt by him or it of the Transferee
Offer, together with a complete copy of said Transferee Offer and
a statement as to the identity of the Transferee. The Company
shall have a period of thirty (30) days from the receipt of such
Notice (the "Notice Period"), to exercise in writing its Option
to purchase all of the Offered Shares, by written notice to the
Selling Stockholder (the "Exercise Notice").
(d) If the Company elects to exercise the Option
herein granted as to all of the Offered Shares, the Exercise
Notice shall fix a closing date for such purchase (the
"Closing"), which shall be within sixty (60) days after the
expiration of the Notice Period, and shall state the number of
the Offered Shares to be purchased. The purchase price shall be
payable in cash only.
(e) If the Company rejects or fails to exercise the
Option herein granted as to all of the Offered Shares, the Non-
Offering Stockholders shall have the opportunity to collectively
purchase all of the Offered Shares. Not earlier than the
expiration of the Notice Period, nor later than thirty (30) days
after the expiration of the Notice Period, the Non-Offering
Stockholders shall have the Option to collectively purchase all
of the Offered Shares. Each Non-Offering Stockholder shall have
the Option to purchase his or its "Proportion" of the Offered
Shares, which is defined as a fraction, the numerator of which is
equal to the total number of Shares and Future Shares owned by
such Non-Offering Stockholder, and the denominator of which is
the total number of Shares and Future Shares owned by all Non-
Offering Stockholders. Each Non-Offering Stockholder who
exercises his or its Option to purchase his or its Proportion of
the Offered Shares shall do so by giving an Exercise Notice. In
the event that any such Non-Offering Stockholder elects to
purchase less than his or its Proportion, each of the remaining
Non-Offering Stockholders shall be entitled to purchase a pro
rata portion of such unpurchased Offered Shares. If the Non-
Offering Stockholders elect to exercise the Option herein granted
as to any of the Offered Shares, the purchase shall be within
ninety (90) days after the expiration of the Notice Period and
the purchase price shall be payable in cash only.
(f) If and to the extent the Company and the Non-
Offering Stockholders collectively reject or fail to exercise the
Option herein granted as to all of the Offered Shares, or if the
exercise or purchase by the Company and the Non-Offering
Stockholders is not made within the time periods specified
herein, then the Selling Stockholder shall be free, for a period
of thirty (30) days from the date of such failure to exercise or
purchase, to Transfer all of the Offered Shares to the Transferee
for the same price and on the same terms and conditions as set
forth in the Notice, subject only to any additional restriction
on such Transfer that may be imposed by any other agreement
between the parties hereto, by statute, law, ordinance, rule or
regulation, or by the Certificate of Incorporation or Bylaws of
the Company. If the Selling Stockholder does not Transfer the
Offered Shares to the Transferee within such thirty (30) day
period, his or its right to Transfer the Offered Shares pursuant
to this Section 4 with respect to the Transfer then under
consideration shall cease and terminate. Any Transfer by a
Selling Stockholder after the last day of such thirty (30) day
period made without compliance with the terms, provisions and
conditions of this Section 4 shall be absolutely null and void.
5. Option Upon Death. Except as otherwise set forth in the
Employment Agreement, upon the death of any Stockholder, the
Company shall have an irrevocable option to purchase any or all
the Shares and Future Shares owned by him or her immediately
prior to his or her death, his or her estate, or by any trust
established by the deceased shareholder. The Company may
exercise this option at any time within sixty (60) days after the
Stockholder's death by delivering notice thereof in compliance
with this Agreement. The purchase price of such Shares and
Future Shares shall be mutually agreed by the parties and shall
be based upon an independent appraiser valuation as chosen by the
Company in its sold discretion.
6. Co-Sale Rights. If any of the Stockholders (the
"Selling Stockholders") proposes to sell any portion of his or
its Shares or Future Shares (the "Third Party Sale") to a third
party (the "Third Party") who is not an affiliate or relative of
the Selling Stockholder, such Selling Stockholder shall first
give written notice of the Third Party Sale to each other
Stockholder, and each other Stockholder separately may elect to
sell a portion of the Shares or Future Shares then owned by such
other Stockholder to the same Third Party on the same terms and
conditions as the Selling Stockholder (the "Co-Sale Right'). The
number of Shares or Future Shares owned by each other Stockholder
which shall be entitled to the Co-Sale Right in any instance (the
"Offered Shares") shall be determined by multiplying the total
number of Shares or Future Shares subject to the Third Party Sale
by a fraction: (i) the numerator of which shall be the number of
Shares and Future Shares then owned by such other Stockholder,
and (ii) the denominator of which shall be the sum of all Shares
and Future Shares then owned by all Stockholders. The Offered
Shares shall be rounded down to the nearest whole number of
shares and the total number of Shares and Future Shares the
Selling Stockholder may convey pursuant to such Third Party Sale
shall be reduced by the number of Offered Shares. Each other
Stockholder shall notify the Selling Stockholder within thirty
(30) days of receipt of the notice of the Third Party Sale,
whether such other Stockholder wishes to exercise its Co-Sale
Right, and if such other Stockholder does not give such notice in
a timely manner, such right shall expire with respect to such
instance. Upon the consummation of a sale pursuant to a Third
Party Sale each other Stockholder exercising its Co-Sale Right
shall make available for transfer its Offered Shares and shall be
entitled to receive its pro rata share of the proceeds of such
sale. The Co-Sale Right may be exercised any number of times but
may not be transferred by a Stockholder under any circumstances.
To the extent the Third Party refuses to purchase the Offered
Shares, or any part thereof, from any Stockholder exercising its
Co-Sale Right hereunder, the Selling Stockholder shall not sell
to such Third Party any Shares or Future Shares, unless and
until, simultaneously with such sale, the Selling Stockholder
shall purchase such refused Offered Shares from the other
Stockholder(s) on the same terms and conditions as the Selling
Stockholder sells its or his Shares or Future Shares to the Third
Party.
7. Condition to Exercise of Certain Rights.
Notwithstanding any provision in this Agreement to the contrary,
Home Service shall not be entitled to enforce or exercise its
rights under the terms and conditions of Sections 2 and 3 of this
Agreement unless Home Service makes all of the capital
contributions described in, and otherwise complies with all of
its obligations set forth in, Sections 1.2 and 1.3 of that
certain Stock Purchase Agreement of even date herewith by and
between Home Service, Xxxxxxx and the Company.
8. Limitation on Liquidation Preference. Notwithstanding
anything in Section IV(C)(1)(a) of the Company's Certificate of
Incorporation to the contrary, if the amount paid by Home Service
to the Company to purchase its shares of Series A Convertible
Preferred Stock is less than Fifteen Million Dollars
($15,000,000), the Liquidation Preference (as such term is
defined in the Certificate of Incorporation) shall be modified to
be equal to the amount determine by dividing the actual amount
paid by Home Service for such shares by three (3).
9. Additional Capital Contributions. From time to time,
the Company may request each of the Stockholders to make
additional capital contributions to the Company for working
capital purposes or to assist the Company for acquisition
activities. The Company shall make any such capital contribution
requests to each of the Stockholders by delivering a notice by
certified mail to each Stockholder setting forth the aggregate
amount of said capital contribution and the pro-rata portion that
each Stockholder is requested to make of such capital
contribution. Within sixty (60) days of receipt of such notice,
each of the Stockholders shall be entitled to make his or its pro-
rata capital contribution by delivering to the Company a
certified check in the amount of the contribution. Thereafter,
the Company shall issue to each Stockholder making the
contribution such Future Shares of Common Stock (except for Home
Service, who shall be issued shares of Series A Convertible
Preferred Stock of the Company) as are calculated by dividing the
capital contribution made by each Stockholder by the fair market
value of each of the Future Shares at the time of the
contribution. The parties agree that the fair market value of
the Future Shares shall be determined by agreement of the parties
hereto, or, if the parties cannot agree upon such value, by
appraisal by one or more third party appraisers with significant
experience in valuing entities like the Company. In the event
that any Stockholder fails to make the capital contribution, the
remaining Stockholders may elect to make such capital
contribution on a pro-rata basis.
10. Transferees Bound. Each subscriber to issuances of
Future Shares and each Transferee of any Shares or Future Shares,
or any interest therein, including any interest in the Voting
Trust, shall own such Shares of Future 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. Each certificate representing any of the Shares or
Future 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
federal and state securities laws:
THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, OR ANY APPLICABLE STATE SECURITIES LAWS, AND
MAY NOT BE PLEDGED, SOLD, ASSIGNED, OR OTHERWISE
TRANSFERRED OR DISPOSED OF WITHOUT REGISTRATION UNDER
SAID ACT AND LAWS OR AN AVAILABLE EXEMPTION THEREFORM.
THE SALE, TRANSFER, PLEDGE OR OTHER DISPOSITION OF
SHARES REPRESENTED BY THIS CERTIFICATE IS FURTHER
RESTRICTED BY THE TERMS OF THAT CERTAIN STOCKHOLDERS
AGREEMENT DATED THE 29th DAY OF MAY, 1998, BETWEEN THE
COMPANY AND ALL ITS STOCKHOLDERS AND CERTAIN TERMS OF
THE CERTIFICATE OF INCORPORATION AND BYLAWS OF THE
COMPANY, WHICH INSTRUMENTS AND/OR AGREEMENTS MAY BE
EXAMINED AT THE PRINCIPAL OFFICES OF THE COMPANY.
11. Termination.
(a) This Agreement and all restrictions on the
Transfer of Shares and Future Shares created hereby shall
terminate on the occurrence of any of the following events: (i)
the bankruptcy or dissolution of the Company; (ii) a single
Stockholder becoming the owner of all of the Shares and Future
Shares, which are then subject to this Agreement; (iii) the
execution of a written instrument by the persons or entities who
are parties to this Agreement at such time which terminates the
same; or (iv) upon the sale of shares of capital stock or
convertible debt securities of the Company in an initial public
offering pursuant to an effective registration statement under
the Securities Act of 1933, as amended, resulting in at least
$25,000,000 or net proceeds actually received by Target.
(b) Upon termination of this Agreement, by reason of
the occurrence of any of the foregoing events, each Stockholder
shall have the right within thirty (30) days after termination to
purchase from the Company all insurance policies on his life
owned by the Company for cash in the amount of the cash surrender
value thereof and the unearned net premiums thereon, both amounts
as of the date of the termination of the Agreement.
(c) 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.
12. General Provisions.
(a) Governing Law. This Agreement shall be construed
pursuant to the laws of the State of Delaware with reference to
conflicts of laws principles.
(b) Definitions. Unless the context otherwise
requires, the words "Stockholder" and "Stockholders" shall for
all purposes of this Agreement mean and include (1) all of the
parties hereto other than the Company; and (2) all persons to
whom Shares or Future Shares may hereafter be issued or
transferred.
(c) Remedies for Breach. The Stockholders expressly
recognize and agree that violation of the terms and provisions of
this Agreement, including without limitation, those relating to
the restrictions on Transfer of Shares and Future Shares, may
cause irreparable damage to Company or the other Stockholders,
which may not be adequately compensated by monetary damages. In
the event of a breach or threatened breach by any Stockholders of
the provisions of this Agreement, the Company and the other
Stockholders, in addition to and not in limitation of any other
rights, remedies, or damages available to the Company or other
Stockholders at law or in equity, shall be entitled to a
permanent injunction in order to prevent or to restrain any such
breach by a Stockholder or by such Stockholder's partners,
agents, representatives, servants, employees or transferees. The
Stockholders 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 and other communications
required or permitted to be given hereunder shall be in writing
and shall be deemed to have fully given if delivered personally
or sent by certified mail, postage prepaid, to the following
addresses:
If to Home Service:
Home Service Solutions Inc.
Xxxx X. XxXxxxxxx, President
0000 Xxxxxx
Xxxxxx Xxxx, Xxxxxxxx 00000-0000
with copies to:
Xx. Xxxxxx Xxxx
Senior Vice President
Chief Legal Officer
0000 Xxxxxx
Xxxxxx Xxxx, Xxxxxxxx 00000-0000
and
Xxxxxxxx Xxxxxxx & Xxxxxx, P.C.
000 Xxxx 00xx Xxxxxx, Xxxxx 0000
Xxxxxx Xxxx, Xxxxxxxx 00000
Attn: Xxxxxx X. Xxxxxxxxxx, Xx., Esq.
If to the Company:
X.X. Xxxxxxx Enterprises, Inc.
Attn: R. Xxxxxxx Xxxxxxx
President and Chief Executive Officer
0000 Xxxxxxxx Xxxxxx
Xxxxxx, Xxxxxxx 00000
with copies to:
Chorey, Taylor & Xxxx
Attn: Xxxxx X. Xxxxxxxx
The Lenox Building, Suite 1700
0000 Xxxxxxxxx Xxxx, X.X.
Xxxxxxx, Xxxxxxx 00000-0000
If to Xxxxxxx:
R. Xxxxxxx Xxxxxxx
0000 Xxxxxxxx Xxxxxx
Xxxxxx, Xxxxxxx 00000
or to any other address or addresses as may hereafter be
specified by notice given by any of the above for itself to the
others. Additionally, notices and other communications required
or permitted to be given hereunder may be sent using any other
means (including expedited courier, messenger service, facsimile
transmission or electronic mail), but no such notices or other
communications shall be deemed to have been given unless and
until they are actually received by the intended recipient.
(e) Amendment. This Agreement may be amended or
altered only by the execution of a written instrument by the
Company and all the Stockholders who then own Shares or Future
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,
permitted assigns, and transferees, and to the Stockholders and
their respective heirs, personal representatives, successors and
permitted assigns and transferees.
(h) Facsimile Signatures. The parties hereby agree
that, for purposes of the execution of this Agreement, facsimile
signatures shall constitute original signatures.
(i) Entire Agreement. Each Stockholder represents
that he or it has not granted, and is not a party to, any proxy,
voting trust (other than the Voting Trust) or other agreement
which is inconsistent with or conflicts with the provisions of
this Agreement. Except for the Voting Trust, and applicable
provisions of the Employment Agreement, the Escrow Agreement, the
Stock Purchase Agreement, and the Registration Rights Agreement,
this Agreement contains the entire agreement among the parties
with respect to the subject matter hereof, and to such extent
supersedes all prior oral or written agreements, commitments or
understandings with respect to the subject matter hereof.
(j) Assignment. This Agreement and the rights and
obligations of any party hereunder are not assignable by any of
the parties hereto without the written consent of the others.
(k) Rules of Construction. Notwithstanding any
provision in the Certificate of Incorporation and the Bylaws of
the Company, if there is any conflict or inconsistency between
the terms of this Agreement shall govern and control.
Furthermore, the terms of this Agreement shall supersede the
provisions of Article IV(C)(4)-(6) of the Company's Certificate
of Incorporation during the term of this Agreement.
[END OF PAGE]
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
IN WITNESS WHREOF, the Company and the Stockholders have
executed this Agreement on the day and year above written.
HOME SERVICE SOLUTIONS INC.,
A Missouri corporation
By: /s/ Xxxx X. XxXxxxxxx
Name: Xxxx X. XxXxxxxxx
Title: President
X.X. XXXXXXX ENTERPRISES, INC.,
a Delaware corporation
By: /s/ X. X. Xxxxxxx
R. Xxxxxxx Xxxxxxx, Chief
Executive Officer
/s/ X. X. Xxxxxxx
R. Xxxxxxx Xxxxxxx, individually
and as Voting Trustee and
Shareholder's Representative under
that certain Voting Trust Agreement
dated the 22nd day of May, 1998
FIRST AMENDMENT TO STOCKHOLDERS AGREEMENT
THIS FIRST AMENDMENT TO STOCKHOLDERS AGREEMENT (this
"First Amendment") is made and entered into as of April 1, 1999,
by and among X. X. Xxxxxxx Enterprises, Inc., a Delaware
corporation (the "Company"), and the stockholders of the Company
set forth on the signature pages to this First Amendment, being
all of the stockholders of the Company (individually, a
"Stockholder" and collectively, the "Stockholders").
WHEREAS, the Company and its then current Stockholders
as of May 29, 1998, entered into a certain Stockholders Agreement
dated May 29, 1998, a copy of which is attached hereto as Exhibit
A (the "Stockholders Agreement"), pursuant to which the parties
thereto set forth certain provisions relating to the ownership
and governance of the Company, and entered into an agreement
relating to other corporate affairs; and
WHEREAS, pursuant to Section 12(e) of the Stockholders
Agreement, the parties hereto wish to amend the Stockholders
Agreement in accordance with the provisions hereof.
NOW, THEREFORE, for and in consideration of the
premises, the mutual covenants contained herein, and other good
and valuable considerations, the receipt and legal sufficiency of
which are hereby acknowledged, the parties hereto agree as
follows:
1. Permitted Transfers. Current Section 1 of the
Stockholders Agreement is hereby renumbered as Section 1(a) of
the Stockholders Agreement, and the following is hereby added as
new Section 1(b) of the Stockholders Agreement:
(b) The restrictions on Transfer of any Shares or
Future Shares set forth in this Agreement shall not be
applicable to any of the following Transfers:
(1) The pledge by any Stockholder of Shares or
Future Shares to the Company or to any of its
subsidiaries or other affiliates to secure any
obligations of such Stockholder to any such entity;
(2) The Transfer by R. Xxxxxxx Xxxxxxx of up to
Two Hundred Fifty Thousand (250,000) of his Shares or
Future Shares per calendar year, but only if: (I) R.
Xxxxxxx Xxxxxxx gives Home Service Solutions, Inc.
written notice of any such transfer and (II) such
transferee(s) shall have contemporaneously with the
consummation of such Transfer executed and delivered to
R. Xxxxxxx Xxxxxxx and the Company an agreement
substantially in the form of Exhibit B attached hereto;
or
(3) Any Transfer approved in writing by both R.
Xxxxxxx Xxxxxxx and Home Service Solutions Inc., but
only if such transferee(s) shall have contemporaneously
with the consummation of such Transfer executed and
delivered to the transferor and the Company an
agreement substantially in the form of Exhibit B
attached hereto.
2. Notices. The following sentence shall be added at the
end of Section 12(d) of the Stockholders Agreement:
The addresses of all future parties to this Agreement
shall be determined from the Company's books and records.
All parties hereto shall keep a current address on file with
the Company for purposes of this Section 12(d).
3. No Other Amendments. Except as otherwise provided in
Sections 1 and 2 above, the Stockholders Agreement, as amended to
date, shall remain in full force and effect with no further
amendments pursuant to this First Amendment.
4. Counterparts. This First Amendment may be executed
simultaneously in multiple counterparts, each of which shall be
deemed an original, and all of which, when taken together, shall
constitute one and the same document. The signature of any party
to any counterpart shall be deemed a signature to, and may be
appended to, any other counterpart.
5. Consent to Certain Prior and Future Transfers.
(a) The Stockholders and the Company hereby acknowledge and
understand that (1) effective on November 15, 1998, R. Xxxxxxx
Xxxxxxx transferred 240,000 shares of the capital stock of the
Company owned by him to five key employees of the Company and/or
its subsidiaries without first obtaining the written consent of
the Stockholders and the Company is required by the Stockholders
Agreement; and (2) all such transferees have executed and
delivered to R. Xxxxxxx Xxxxxxx and the Company an agreement
substantially in the form of Exhibit B attached hereto and have
entered into voting trust agreements naming R. Xxxxxxx Xxxxxxx as
voting trustee. The Stockholders and the Company hereby consent
to and ratify all such transfers, waive all claims they may
otherwise have against R. Xxxxxxx Xxxxxxx under the Stockholders
Agreement or otherwise in connection with all such transfers, and
agree that the transferees are and shall be parties to the
Stockholders Agreement as stockholders of the Company.
(b) The Stockholders hereby acknowledge and understand that
(1) Xxxxxxx X. Xxxxxxx desires to transfer up to 80,000 shares of
the capital stock of the Company owned by him to one or more
former key employees of Xxxx-Royal, Inc.; and (2) Xxxxxxx X.
Xxxxxxx has agreed that he will only make such transfers if the
transferees shall contemporaneously with the consummation of such
transfers execute and deliver to Xxxxxxx X. Xxxxxxx and the
Company an agreement substantially in the form of Exhibit B
attached hereto. Based upon Xxxxxxx X. Xxxxxxx' covenant set
forth above, the Stockholders and the Company hereby consent to
all such transfers and waive all claims they may otherwise have
against Xxxxxxx X. Xxxxxxx under the Stockholders Agreement or
otherwise in connection with all such transfers, and agree that
upon such transfers the transferees shall be parties to the
Stockholders Agreement as stockholders of the Company.
(c) The Stockholders hereby acknowledge and understand that
(1) Xxxxxx X. Xxxxx desires to transfer up to 15,000 shares of
the capital stock of the Company beneficially owned by him to Xx.
Xxxxxx X. Xxxxxxx, and up to 15,000 shares of the capital stock
of the Company beneficially owned by him to Xxxxx X. Xxxxxxxx;
and (2) Xxxxxx X. Xxxxx has agreed that he will only make such
transfers if the transferees shall contemporaneously with the
consummation of such transfers execute and deliver to Xxxxxx X.
Xxxxx and the Company an agreement substantially in the form of
Exhibit B attached hereto. Based upon Xxxxxx X. Xxxxx' covenant
set forth above, the Stockholders and the Company hereby consent
to all such transfers and waive all claims they may otherwise
have against Xxxxxx X. Xxxxx under the Stockholders Agreement or
otherwise in connection with all such transfers, and agree that
upon such transfers the transferees shall be parties to the
Stockholders Agreement as stockholders of the Company.
(d) The Stockholders hereby acknowledge and understand that
(1) Xxxxx X. Xxxxxxxx and Xxxxxx X. Xxxxxxxx each desires to
transfer up to 42,000 shares of the capital stock of the Company
owned by him or her to one or more direct family members; and (2)
Xxxxx X. Xxxxxxxx and Xxxxxx X. Xxxxxxxx each has agreed that he
or she will only make such transfers if the transferees shall
contemporaneously with the consummation of such transfers execute
and deliver to Xxxxx X. Xxxxxxxx or Xxxxxx X. Xxxxxxxx, as the
case may be, and the Company an agreement substantially in the
form of Exhibit B attached hereto. Based upon the covenants of
Xxxxx X. Xxxxxxxx and Xxxxxx X. Xxxxxxxx set forth above, the
Stockholders and the Company hereby consent to all such transfers
and waive all claims they may otherwise have against Xxxxx X.
Xxxxxxxx and Xxxxxx X. Xxxxxxxx under the Stockholders Agreement
or otherwise in connection with all such transfers, and agree
that upon such transfers the transferees shall be parties to the
Stockholders Agreement as stockholders of the Company.
IN WITNESS WHEREOF, the parties have executed this First
Amendment as of the date first above written.
STOCKHOLDERS:
/s/ X. X. Xxxxxxx
R. Xxxxxxx Xxxxxxx, individually
and as voting trustee
HOME SERVICE SOLUTIONS INC.
By: /s/ Xxxx X. XxXxxxxxx
Xxxx X. XxXxxxxxx, President
/s/ Xxxxxxx X. Xxxx
Xxxxxxx X. Xxxx
/s/ Xxxxx X. Xxxxxxxx
Xxxxx X. Xxxxxxxx
/s/ Xxxxxxx X. Xxxxxxxx
Xxxxxxx X. Xxxxxxxx
/s/ Xxxxx X. Xxxxxxxx
Xxxxx X. Xxxxxxxx
J. Xxxxx Xxxxxxxxx
/s/ Xxxxxxx Xxxxxx
Xxxxxxx Xxxxxx
/s/ Xxxx Xxxxxxxx
Xxxx Xxxxxxxx
/s/ Xxxxxxx X. Xxxxx
Xxxxxxx X. Xxxxx
/s/ Xxxxxxx X. Xxxxxxx
Xxxxxxx X. Xxxxxxx
/s/ Xxxxx X. Xxxxxxx
Xxxxx X. Xxxxxxx
/s/ Xxxxxxx X. Xxxxx
Xxxxxxx X. Xxxxx
/s/ Xxxxx X. Xxxxxxxx
Xxxxx X. Xxxxxxxx
/s/ Xxxxxx X. Xxxxxxxx
Xxxxxx X. Xxxxxxxx
/s/ Xxxx X. Xxxx
Xxxx X. Xxxx
/s/ Xxx X. Xxxx
Xxx X. Xxxx
/s/ Xxxxxxx X. Xxxxxx
Xxxxxxx X. Xxxxxx
/s/ Xxx X. Xxxxx
Xxx X. Xxxxx
COMPANY:
X.X. Xxxxxxx Enterprises, Inc.
By: /s/ X. X. Xxxxxxx
R. Xxxxxxx Xxxxxxx, Chief Executive
Officer
