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EXHIBIT 10.13
SHAREHOLDERS AGREEMENT
This SHAREHOLDERS AGREEMENT (this "Agreement"), dated as of January 25,
2000, is by and among MigraTEC, Inc., a Florida corporation (the "Company"), and
MT Partners, L.P., a Texas limited partnership ("Cardinal"), and Mercury Fund
No. 1, Ltd., a Texas limited partnership ("Mercury;" Cardinal and Mercury are
individually referred to herein as an "Investor Shareholder" and, collectively,
as the "Investor Shareholders"), and Xxxxxx Xxxxxxxxxx, Xxx Xxxxxxxx, Xxxx
Xxxxxxx and Xxxx X. Xxxxx (individually, a "Management Shareholder" and,
collectively, the "Management Shareholders") (all individually a "Shareholder"
and, collectively as the "Shareholders") with respect to all of the issued and
outstanding shares of Common Stock, no par value per share (the "Common Stock"),
and Convertible Preferred Stock, Series A, $0.01 par value per share (the
"Series A Preferred Stock"), of the Company, presently or hereafter owned by
each of the Shareholders (collectively, the "Shares").
W I T N E S S E T H:
WHEREAS, the Company has entered into a Note and Warrant Purchase
Agreement (the "Note Purchase Agreement") with Cardinal and Mercury providing
for the issuance to Cardinal and Mercury of promissory notes convertible into
shares of Series A Preferred Stock or Common Stock (the "Notes") and warrants to
purchase shares of Common Stock (the "Warrants"); and
WHEREAS, it is a condition to the consummation of the Note and Warrant
Purchase Agreement that the Company and the Shareholders enter into this
Agreement; and
WHEREAS, the Shareholders agree that the success of the Company
requires the active interest and support of the Shareholders and therefore
desire to promote the best interests of the Company and their mutual interests
by imposing certain conditions, limitations and agreements on the Shares owned
by them as set forth in this Agreement;
NOW, THEREFORE, for and in consideration of the mutual covenants and
promises hereinafter set forth, and for other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the parties hereto
agree as follows:
ARTICLE I
RESTRICTIONS ON TRANSFER OF SHARES
Section 1.1. General Restriction on Transfers.
(a) Each of the Shareholders agrees that such Shareholder will
not in any way sell, transfer, pledge, encumber, assign or otherwise
dispose of any of such Shareholder's
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Shares, or any right or interest therein, whether voluntarily or
involuntarily or by operation of law (each of the foregoing
transactions is hereinafter referred to as a "Disposition"), except in
accordance with the terms of this Agreement, the Note Purchase
Agreement or any instrument governing the terms of the Series A
Preferred Stock or Common Stock.
(b) In addition to the restrictions on transfer set forth in
Section 1.1(a), during the term of this Agreement, none of the Shares
may be transferred unless either (i) such Shares are registered under
the Securities Act of 1933, as amended (the "Securities Act"), and
registered or qualified under any other applicable securities statute,
or (ii) the Company has received an opinion of counsel, in form and
substance reasonably satisfactory to the Company, that such shares may
be transferred in compliance with the Securities Act and any other
securities statute without such registration or qualification.
Section 1.2. Permitted Transfers. Notwithstanding that such transaction
shall be defined as a Disposition under this Agreement, the transfer
restrictions contained in Section 1.1(a) shall not apply to:
(a) a transfer to (i) any entity or entities owned or
controlled by a Shareholder; (ii) any shareholder, member or partner of
an Investor Shareholder (each, an "Equity Holder"); (iii) any
individual having any relationship by blood, marriage or adoption to a
Shareholder; (iv) a trust or trusts in which the Shareholder or any
Equity Holder or anyone related to any such person by blood, marriage
or adoption, has a vested or contingent interest; (v) a nominee or
fiduciary holding for the sole benefit of the Investor Shareholder and
the transfer by such nominee or fiduciary back to such Investor
Shareholder;
(b) a bona fide pledge of the Shares to a financial
institution in accordance with the terms of Section 1.5 hereof; or
(c) a sale of Shares by a Shareholder in a public transaction.
Dispositions which are not subject to the transfer restrictions of this
Agreement by reason of this Section 1.2 are referred to herein as "Permitted
Transfers." Unless agreed to otherwise by the non-transferring Shareholders, any
transferee receiving Shares pursuant to a Permitted Transfer (other than a
transfer pursuant to Section 1.2(c)) shall be deemed a "Shareholder" for
purposes of this Agreement. In the event of a Permitted Transfer (other than a
transfer pursuant to Section 1.2(c)), any transferee other than the Company that
is not a Shareholder prior to such Permitted Transfer (and his or her spouse, if
any) must execute a counterpart of this Agreement. Notwithstanding the failure
to execute a counterpart of this Agreement, any transferee shall take the Shares
subject to this Agreement and by acceptance of any certificate representing such
Shares shall be bound by this Agreement (other than a transfer pursuant to
Section 1.2(c)). No Shareholder and no transferee receiving Shares pursuant to a
Permitted Transfer (other than a transfer pursuant to Section 1.2(c)) may use
the provisions of this Section 1.2 to circumvent or otherwise frustrate the
purposes of the transfer restrictions contained in this Agreement.
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Section 1.3. Rights of First Refusal for Proposed Private Transfers of
Shares.
(a) Except for any Permitted Transfers, if a Management
Shareholder proposes to sell all or a part of such Management
Shareholder's Shares or receives a bona fide offer for the purchase of
all or a part of such Management Shareholder's Shares (or any rights or
interests therein) in a private transaction which the Management
Shareholder desires to accept, or such Management Shareholder otherwise
proposes or agrees to transfer all or a part of such Management
Shareholder's Shares (or any rights or interests therein) in a private
transaction, such Shareholder (the "Offering Shareholder") shall first
make a written offer (the "Offer") to sell such Shares to the other
Shareholders (such other Shareholders being sometimes collectively
referred to herein for purposes of this Section 1.3 as the "Offerees").
The Offer shall set forth:
(i) the name and address of any proposed transferee;
(ii) the number of Shares proposed to be transferred
(the "Offered Shares");
(iii) the cash consideration per Share to be received
by the Offering Shareholder in connection with such proposed
private sale;
(iv) the address of the Offering Shareholder at which
each Offeree may give any notice required herein;
(v) an offer to sell and transfer the Offered Shares
to the Offerees pursuant to the provisions of this Agreement;
and
(vi) all other terms and conditions of the proposed
transfer.
(b) The Offerees shall have the right at any time prior to the
close of business on the fifteenth (15th) day following the date of
receipt of such Offer (the "Offer Date") to deliver to the Offering
Shareholder a written notice of election to purchase any part or all of
the Offered Shares described in the Offer at a cash price and upon such
other terms as are specified in such Offer, provided however, that the
aggregate of all of the elections must constitute an election to
purchase all of the Offered Shares. The Offerees (the "Investor
Offerees") shall have the option and preferential right, but shall not
be obligated, to purchase all of the Offered Shares. Such option shall
be exercisable by notice of election from an Investor Offeree to the
Offering Shareholder within the requisite time period. The Investor
Offeree's notice shall set forth the number of Offered Shares which the
Investor Offeree desires to purchase. Each Investor Offeree shall have
the right to accept the Offer as to all or part of the Offered Shares.
If an Investor Offeree shall elect to purchase all or a part of the
Offered Shares, such Investor Offeree shall, within ten (10) days after
the Offer Date, individually communicate in writing such election to
purchase to the Offering Shareholder, which communication shall be
delivered by hand or mailed to such Offering Shareholder at
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the address set forth on the signature page hereto or at such other
address furnished in accordance with Section 4.1 and shall, when taken
in conjunction with the Offer, be deemed to constitute a valid, legally
binding and enforceable agreement for the sale and purchase of the
Shares covered thereby, so long as the Investor Offerees in the
aggregate shall have elected to purchase all of the Offered Shares.
Upon the expiration of all applicable periods under this Section
1.3(b), the number of Shares to be purchased by each Investor Offeree
shall be determined as follows: (1) there shall first be allocated to
each Investor Offeree a number of Offered Shares equal to such Investor
Offeree's Pro Rata Fraction (defined below), and (2) the balance, if
any, not allocated under clause (1) above, shall be allocated to those
Investor Offerees who accepted the Offer as to a number of Offered
Shares which exceeded their respective Pro Rata Fractions, in each case
on a pro rata basis in proportion to the amount of such excess. For
purposes of this Section 1.3, a Shareholder's "Pro Rata Fraction" shall
equal that number of Offered Shares as shall be equal to the product
obtained by multiplying (i) the aggregate number of Offered Shares by
(ii) a fraction, the numerator of which is the number of shares of
Common Stock of the Company then owned by such Investor Offeree
(assuming the conversion and exercise by such Investor Offeree of all
securities convertible into or exercisable for Common Stock) and the
denominator of which is the total number of shares of Common Stock
owned by all the Investor Offerees (assuming the conversion and
exercise by such Investor Offerees of all securities convertible into
or exercisable for Common Stock). Upon such determination, the
Secretary of the Company shall give prompt notice to the Investor
Offerees of the number of Shares which may be purchased at any time by
any of the Investor Offerees during each of the periods specified
above. For the purpose of the foregoing, fractional interests shall
either be rounded to the nearest full share or be totaled and
allocated, on a whole-share basis, among the Investor Offerees that
have exercised their purchase rights.
(c) If the Investor Offerees do not elect to purchase all of
the Offered Shares pursuant to Section 1.3(b), the Offering Shareholder
will have the right to make a Disposition, subject to Section 5.9, of
all of the Offered Shares to the proposed transferee pursuant to the
terms of the Offer, subject however, to the following: (i) the
consummation of any such Disposition shall be subject to the "tag along
rights" set forth in Section 1.4, (ii) such transferee must execute and
become a party to this Agreement and must hold the Offered Shares
subject to all the terms and conditions of this Agreement;
notwithstanding the failure to execute a counterpart of this Agreement,
any such transferee shall take such Offered Shares subject to this
Agreement and by acceptance of any certificate representing such
Offered Shares shall be bound by this Agreement, and (iii) if all of
the Offered Shares are not transferred in accordance with the terms of
the Offer within a period of one hundred twenty (120) days after the
expiration of the option period provided in Section 1.3(b), the
Offering Shareholder shall not thereafter dispose of such Shares
without first providing the Investor Shareholders a new Offer and
complying with the foregoing procedures specified in Sections 1.3(a)
and (b).
(d) If an Investor Offeree elects to accept an Offer, then the
Offering Shareholder shall deliver the certificate or certificates, if
any, representing the Shares described in the
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Offer, free and clear of all liens, adverse claims and encumbrances
(except for those created by this Agreement and except for any
securities law restrictions that may be applicable either before or by
reason of the transfer), to the purchasing Investor Offerees in return
for the payment of the purchase price, by cashier's check or wire
transfer, for such securities, all in accordance with the terms of the
Offer or as otherwise established by the mutual agreement of the
parties.
(e) In a proposed Disposition under this Section 1.3, the
consideration proposed to be paid must be cash due and payable at the
closing of such Disposition.
(f) Except as otherwise permitted by this Agreement, the
Management Shareholders agree that they will not, directly or
indirectly, for a period of two (2) years from the date of this
Agreement, without the prior written consent of the Investor
Shareholders, sell, offer to sell or otherwise transfer any Shares;
provided, however, that with respect to public sales by each Management
Shareholder, the foregoing restriction shall not apply as to twenty
percent (20%) of such Management Shareholder's Shares (assuming the
conversion and exercise by such Management Shareholder of all
securities convertible or exercisable for Common Stock) as of January
15, 2000 and shall lapse as to an additional twenty percent (20%) of
such Management Shareholder's Shares on each six (6) month anniversary
of the date of this Agreement such that no such restriction shall apply
to the Management Shareholders' Shares effective as of the two year
anniversary of the date of this Agreement; and provided further,
however, that none of the foregoing restrictions shall apply to Shares
owned by, or warrants purchased in conjunction with the purchase of
Shares owned by, the Management Shareholders as of the date hereof; and
provided further, however, that this provision will terminate and be of
no further force and effect as to any Management Shareholder
immediately upon such Management Shareholder's termination of
employment with the Company for any reason other than for "cause," as
determined pursuant to such Management Shareholder's employment
agreement with the Company.
Section 1.4. Tag-Along Rights.
(a) For a period of three (3) years from the date of this
Agreement, if an Offering Shareholder proposes to accept one or more
bona fide offers (collectively, the "Purchase Offer") from any persons
(collectively the "Purchaser") to purchase Shares from such Offering
Shareholder in a privately-negotiated transaction which is subject to
the provisions of Section 1.3 hereof, and any other Investor
Shareholder shall fail to exercise his or its right of first refusal
pursuant to Section 1.3 with respect to all or part of the Offered
Shares (a "Non-Electing Shareholder"), then each Non-Electing
Shareholder shall have the right, exercisable upon written notice to
the Offering Shareholder within twenty (20) days after the Offer Date,
to participate in such Offering Shareholder's sale of Shares on the
same terms and conditions. To the extent any Non-Electing Shareholder
exercises such right of participation, the number of Shares (on a
Common Stock-equivalent basis) (for purposes of this Section 1.4, the
"Offered Shares") which the Offering Shareholder may sell pursuant to
such Purchase Offer shall be correspondingly reduced. The right of
participation of the Non-Electing Shareholders shall be subject to the
terms and conditions set forth in this Section 1.4.
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(b) Each Non-Electing Shareholder may sell all or any part of
that number of Shares (on a Common Stock-equivalent basis) equal to the
product obtained by multiplying (i) the aggregate number of Offered
Shares by (ii) a fraction, the numerator of which is the number of
shares of Common Stock then owned by such Non-Electing Shareholder
(assuming the conversion and exercise by such Non-Electing Shareholder
of all securities convertible into or exercisable for Common Stock) and
the denominator of which is the total number of shares of Common Stock
then owned by the Offering Shareholder and all Non-Electing
Shareholders (assuming the conversion and exercise by such Shareholders
of all securities convertible into or exercisable for Common Stock, and
including any shares that have been transferred in accordance with the
Permitted Transfer provisions hereof); provided, however, that any
purchase by the Purchaser of less than all of the Offered Shares shall
be made from the Offering Shareholder and each participating
Non-Electing Shareholder pro rata based upon the number of Shares
proposed to be sold by each. For purposes of this Section 1.4. the
number of shares that each Non-Electing Shareholder is entitled to sell
under this Section 1.4 is referred to as his "Pro Rata Fraction."
(c) Each Non-Electing Shareholder may participate in the sale
by delivering to the Offering Shareholder for transfer to the Purchaser
one or more certificates (after conversion into Common Stock of any
convertible securities by such Non-Electing Shareholder required to
deliver such certificates) properly endorsed for transfer, which
represent the number of Shares (on a Common Stock-equivalent basis)
equal to or exceeding the Non-Electing Shareholder's Pro Rata Fraction.
The stock certificate or certificates which a Non-Electing Shareholder
delivers to the Offering Shareholder shall be transferred by the
Offering Shareholder to the Purchaser in consummation of the sale of
the Shares pursuant to the terms and conditions specified in the Offer,
and the Offering Shareholder shall promptly thereafter remit to the
Non-Electing Shareholder that portion of the sale proceeds to which
such Non-Electing Shareholder is entitled by reason of its
participation in such sale.
(d) If the Offering Shareholder should sell any Shares in
contravention of the participation rights of the Non-Electing
Shareholders under this Section 1.4 (a "Prohibited Transfer"), the
Non-Electing Shareholders, in addition to such other remedies as may be
available at law, in equity or hereunder, shall have the put option
provided in Section 1.4(e) below, and the Offering Shareholder shall be
bound by the applicable provisions of such put option.
(e) In the event of a Prohibited Transfer, each Non-Electing
Shareholder shall have the right to sell to the Offering Shareholder a
number of Shares (on a Common Stock-equivalent basis) equal to the
number of Shares such Non-Electing Shareholder would have been entitled
to transfer to the Purchaser in the Prohibited Transfer pursuant to the
terms hereof. Such sale shall be made on the following terms and
conditions:
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(i) The price per share at which the Shares are to be
sold to the Offering Shareholder shall be equal to the price
per Share paid by the Purchaser to the Offering Shareholder in
the Prohibited Transfer. The Offering Shareholder shall also
reimburse the Non-Electing Shareholder for any and all fees
and expenses, including legal fees and expenses, incurred
pursuant to the exercise or the attempted exercise of its
rights under this Section 1.4(e).
(ii) Within ninety (90) days after the later of the
dates on which the Non-Electing Shareholder (a) received
notice from the Offering Shareholder of the Prohibited
Transfer; or (b) otherwise becomes aware of the Prohibited
Transfer, each Non-Electing Shareholder shall, if exercising
the put option created hereby, deliver to the Offering
Shareholder the certificate or certificates representing
Shares to be sold, each certificate to be properly endorsed
for transfer.
(iii) The Offering Shareholder shall, upon receipt of
the certificate or certificates for the Shares to be sold by
the Non-Electing Shareholders, pursuant to Section 1.4(e)(ii),
pay the aggregate purchase price therefor and the amount of
reimbursable fees and expenses, as specified in Section
1.4(e)(i), by a cashier's check or bank draft made payable to
the order of such Non-Electing Shareholder.
(iv) Notwithstanding the foregoing, any attempt to
transfer shares of the Company in violation of this Section
1.4 shall be void, and the Company agrees it will not effect
such a transfer nor will it treat any alleged transferee as
the holder of such shares without the written consent of the
Non-Electing Shareholders.
(f) The exercise or non-exercise of the rights of a
Shareholder under Section 1.4 to participate in one or more sales of
Shares made by the Offering Shareholder shall not adversely affect the
rights of such Shareholder to participate in subsequent sales of Shares
or transfers by such Offering Shareholder pursuant to Section 1.3.
Section 1.5. Pledges. Except for the Investor Shareholders, no
Shareholder shall encumber or pledge any Shares unless (i) such Shares shall be
encumbered to a financial institution solely as security for borrowed money and
(ii) such financial institution shall enter into a written agreement with the
Company for the benefit of the Company and the other Shareholders, in all
respects satisfactory to the Company, which provides that such institution
acknowledges that it holds such Shares subject to the terms and provisions of
this Agreement, including the right of first refusal provisions of Section 1.3.
The failure or refusal of such financial institution to enter into such a
written agreement shall not limit the applicability of this Agreement to such
Shares. The attempt by any such financial institution to foreclose a lien on or
security interest in the Shares shall constitute an attempted Disposition
subject to the provisions of Section 1.3.
Section 1.6. Shares Received in Certain Corporate Transactions. The
terms of this Agreement relating to the transfer of Shares shall not apply to
the exchange of Shares pursuant to a plan of merger, consolidation,
recapitalization, or reorganization of the Company, but any stock
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or securities received in exchange therefor shall also become subject to this
Agreement; provided, however, that this Agreement shall terminate upon the
consummation of any such merger, consolidation, recapitalization or
reorganization if any stock or securities received in such merger,
consolidation, recapitalization or reorganization are registered under the
Securities Exchange Act of 1934, as amended.
ARTICLE II
BOARD OF DIRECTORS
Section 2.1. Board Composition and Election. The Company and the
Shareholders hereby acknowledge and agree that the composition of the Board
shall be subject to the following terms and conditions:
(a) The Board shall initially consist of five (5) members. The
size of the Board may be increased or decreased by a resolution adopted
by all of the members of the Board. The Investor Shareholders shall
have the right to designate two (2) members of the Board as set forth
in this Section 2.1; provided, however, that in the event that the size
of the Board is increase to seven members, the Investor Shareholders
shall have the right to designate three (3) members. The Shareholders
agree to vote all of their Shares, and otherwise to use their
respective best efforts as shareholders or directors of the Company, to
cause and maintain the election to the Board of two (2) persons
designated by the Investor Shareholders on a five person Board or three
(3) members on a seven person Board one of which shall be the Chairman
of the Board. One (1) of the members designated by the Investor
Shareholders shall serve as the Chairman of the Board of Directors. The
Investor Shareholders shall have such rights to vote on all other
members of the Board of Directors as shall be provided under applicable
law. If the members of the Board unanimously consent to increase or
decrease the size of the Board to a size that does not permit the
maintenance on the Board of representatives of the Investor
Shareholders in the proportions set forth in the preceding sentence,
the resolution adopted by all of the members of the Board changing the
size of the Board shall specify the respective rights of the
Shareholders to designate members to serve on such increased or
decreased Board of Directors. In the event that the aggregate amount of
all Advances (as defined in the Notes) by the Investor Shareholders
pursuant to the Note Purchase Agreement is less than $3,000,000, the
Investor Shareholders shall only be entitled to designate one (1)
person whom the Shareholders agree to vote for as a director and
support for the position of Chairman of the Board; provided, however,
that as contemplated by Section 5.7 of the Note Purchase Agreement, the
Investor Shareholders may, under certain circumstances, have the right
to designate persons who, if elected, would constitute a majority of
the members of the Board of Directors.
(b) In the absence of any designation from any Investor
Shareholders, the director previously designated by such Investor
Shareholders and then serving shall be re-elected if still eligible to
serve as provided herein. The Board cannot vote to remove any member of
the Board designated in accordance with the aforesaid procedure unless
the Investor Shareholders so vote.
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(c) Any vacancy on the Board created by the resignation,
removal, incapacity or death of any person designated under this
Section 2.1 by the Investor Shareholders shall be filled by another
person designated by the Investor Shareholders. The Shareholders shall
vote their respective Shares in accordance with such new designation,
and any such vacancy shall not be filled in the absence of a new
designation by the Investor Shareholders.
(d) The Shareholders agree that the Investor Shareholders
shall have the right to request, in advance of Board meetings, the
permission of the Board to have non-Board members present during
portions of Board meetings. Upon approval of such requests, which shall
not be unreasonably withheld, such non-Board members shall be eligible
to attend the portions of Board meetings deemed appropriate by the
Board.
Section 2.2. Board Approval of Certain Matters. Neither the Company nor
any subsidiary of the Company shall, without the affirmative consent or approval
of at least seventy percent (70%) of the members of the Board:
(a) authorize or issue additional series or class or shares of
any capital stock resulting in dilution, on a fully-diluted common
stock equivalent basis of greater than 10% when compared to the
fully-diluted common stock equivalent position of the Company on the
date hereof, other than the issuance of (i) 72,927,458 shares of Common
Stock currently issued and outstanding, (ii) 30,000,000 shares of
Common Stock reserved for issuance upon conversion of the Series A
Preferred Stock or conversion of the Notes, (iii) 6,000,000 shares of
Common Stock reserved for issuance upon exercise of warrants issued
pursuant to the Note Purchase Agreement, (iv) 252,716 shares of Common
Stock reserved for issuance upon the exercise of options granted
pursuant to the Company's Employee Stock Option Plan, (v) approximately
8,316,206 shares of Common Stock reserved for issuance to employees,
directors and consultants of the Company and others pursuant to
outstanding options to purchase Common Stock, (vi) approximately
13,968,585 shares of Common Stock reserved for issuance pursuant to
outstanding warrants to purchase Common Stock, and (vii) up to the
number of shares of Common Stock, issuable in a private placement,
equal to the quotient of (i) the difference between (A) $3,750,000 and
(B) the aggregate amount of all Advances (as defined in the Notes) by
the Investor Shareholders pursuant to the Note Purchase Agreement
divided by (ii) $0.125;
(b) sell, abandon, transfer, lease or otherwise dispose of all
or substantially all of the properties or assets of the Company;
(c) merge or consolidate with or into, or permit any
subsidiary to merge or consolidate with or into, any other corporation,
corporations or other entity or entities where such transaction
involves greater than 20% of the Company's market capitalization;
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(d) voluntarily dissolve, liquidate, or wind-up or carry out
any partial liquidation or distribution or transaction in the nature of
a partial liquidation or distribution (except as may be permitted by
any bankruptcy, insolvency, reorganization or similar laws affecting
creditors' rights);
(e) incur or permit to exist aggregate indebtedness for
borrowed money in excess of (i) the Notes, (ii) indebtedness of
$250,000 incurred after the date hereof, and (iii) indebtedness for
borrowed money existing as of the date hereof;
(f) incur or agree to incur any single capital expenditure or
group of related capital expenditures in excess of $150,000;
(g) declare or pay any dividend on or make any distribution
with respect to any capital stock of the Company;
(h) make any payment on account of the purchase of any capital
stock of the Company, other than any such payment made in compliance
with the terms of this Agreement;
(i) amend any employment contract, or make material changes to
the compensation or employee benefits of Xxxxxx Xxxxxxxxxx, Xxxx Xxxxx,
Xxxx Xxxxxxx, Xxx Xxxxxxxx or Xxxxxxx Xxxxxx;
(j) take any action to cause any amendment, alteration or
repeal of the Company's Articles of Incorporation or Bylaws;
(k) pay any severance in excess of amounts contractually
obligated to pay to Xxxxxx Xxxxxxxxxx, Xxxx Xxxxx, Xxxx Xxxxxxx, Xxx
Xxxxxxxx or Xxxxxxx Xxxxxx; or
(l) enter into any contract, agreement or other arrangement
with any "affiliate" of the Company (as such term is defined under the
Securities Act), other than contracts, agreements or arrangements that
arise solely from the ownership by such affiliate of securities of the
Company; provided, however, that if such affiliate is represented on
the Board, such Board representative or representatives shall recuse
themselves from the vote on any such contract, agreement or
arrangement.
In the event the Investor Shareholders have not invested at least $3,000,000 in
the Company pursuant to the Purchase Agreement by May 1, 2000, through no fault
of the Company, the provisions of this Section 2.2 shall become null and void.
Section 2.3. Board Meetings; Fees; Expenses. Unless the members of the
Board unanimously agree otherwise, the Company shall hold its meetings of the
Board no less than quarterly. The Company shall reimburse reasonable
out-of-pocket expenses of non-employee directors incurred in connection with
attending Board and committee meetings and work on any
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special projects. The Company shall pay the Chairman of the Board a fee of
$5,000 per month of service payable monthly in advance. Other non-management
directors shall be paid $10,000 per year payable annually in advance.
ARTICLE III
STOCK LEGEND
The Company and each Shareholder agree that all certificates
representing all Shares of the Company that at any time are subject to the
provisions of this Agreement will have endorsed upon them in boldface type
legends in substantially the following form:
RESTRICTIONS ON THE RIGHT TO OWN OR TRANSFER THE SHARES REPRESENTED BY
THIS CERTIFICATE HAVE BEEN IMPOSED PURSUANT TO A SHAREHOLDERS AGREEMENT
DATED JANUARY 25, 2000, BY AND AMONG THE COMPANY AND CERTAIN HOLDERS OF
THE COMPANY'S STOCK. A COPY OF THE AGREEMENT IS ON FILE AT THE
PRINCIPAL OFFICE OF THE COMPANY AND WILL BE FURNISHED WITHOUT CHARGE TO
THE HOLDER OF THIS CERTIFICATE UPON RECEIPT BY THE COMPANY AT ITS
PRINCIPAL PLACE OF BUSINESS OR REGISTERED OFFICE OF A WRITTEN REQUEST
FROM THE HOLDER REQUESTING SUCH A COPY.
ARTICLE IV
MISCELLANEOUS
Section 4.1. Notices. Any notice required to be given hereunder will be
deemed to be duly given on the date of delivery or attempted delivery during
normal business hours to the party or parties that are to receive such notice at
the addresses indicated on the signature page of this Agreement. The address of
any Shareholder or the Company may be changed only by giving written notice of
such change of address to the Company or to each of the Shareholders, in the
case of the Company.
Section 4.2. Void Transfers. Any attempted or purported Disposition of
any Shares otherwise than in accordance with the terms and conditions of this
Agreement shall be invalid, void ab initio and of no effect; however, the
persons or entities who would otherwise have been Offerees hereunder regarding
such Shares shall, instead of treating such Disposition as a nullity, have the
right (but not the obligation), exercisable at any time prior to the expiration
of six (6) months after first receiving written or other notice of such
attempted or purported Disposition, to purchase such Shares at such price and in
all other respects as if an Offer had been made in accordance with Section 1.3
of this Agreement. Such right shall constitute an "adverse claim" within the
meaning of such term as used within the Uniform Commercial Code as enacted in
the State of Florida. It is hereby agreed by all the Shareholders that the
Company, on its own behalf and on behalf of the Shareholders, upon
SHAREHOLDERS AGREEMENT - Page 11
12
the written request of any Shareholder who asserts that any attempted or
purported Disposition or transfer is not in accordance with the terms of this
Agreement, shall hold and refuse to transfer any of the Shares, or any
certificate therefor, tendered to it for transfer, in addition to, and without
prejudice to, any and all other rights or remedies which may be available to any
Shareholder.
Section 4.3. Entire Agreement; Counterparts. This Agreement contains
the entire understanding between the parties concerning the subject matter
contained in this Agreement, provided Shares are also subject to other
restrictions contained in other agreements with the Company. Except for such
restrictive agreements, there are no representations, agreements, arrangements,
or understandings, oral or written, between or among the parties hereto,
relating to the subject matter of this Agreement, that are not fully expressed
herein. In the event of a conflict between the terms of this Agreement and a
share restriction agreement between the Company and the Shareholder, the terms
of such share restriction agreement shall control. This Agreement may be signed
in one or more counterparts, all of which shall be considered one and the same
agreement.
Section 4.4. Term. This Agreement will terminate, if not earlier
terminated pursuant to Section 1.6, upon the following: (1) the agreement of all
parties hereto to terminate this Agreement; or (2) disposal by Investor
Shareholders of Common Stock equivalents composing more than 60% of their
aggregate ownership as of May 1, 2000.
Section 4.5. Further Assurances. Each party to this Agreement agrees to
perform all further acts and to execute and deliver all further documents as may
be reasonably necessary to carry out the intent of this Agreement.
Section 4.6. Severability. In the event that any of the provisions, or
portions thereof, of this Agreement are held to be unenforceable or invalid by
any court of competent jurisdiction, the validity and enforceability of the
remaining provisions, or portions thereof, will not be affected, and such
unenforceable provision shall be automatically replaced by a provision as
similar in terms as may be valid and enforceable.
Section 4.7. Construction. Whenever used in this Agreement, the
singular number will include the plural, and the plural number will include the
singular and the masculine or neuter gender shall include the masculine,
feminine, or neuter gender. The headings of the Articles and Sections of this
Agreement have been inserted for purposes of convenience and shall not be used
for interpretive purposes.
Section 4.8. Governing Law. This Agreement shall be governed by and
construed in accordance with the internal laws of the State of Florida,
excluding its choice of law rules.
Section 4.9. Successors. Subject to the restrictions against any
Disposition or transfer as contained in this Agreement, the provisions of this
Agreement will benefit and will be binding upon the assigns, successors in
interest, personal representatives, estates, heirs and legatees of each of the
parties hereto. If any of the Shareholders disposes of all of its Shares in
compliance with the terms of this Agreement, it will no longer be a party to
this Agreement unless and until it acquires more
SHAREHOLDERS AGREEMENT - Page 12
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Shares. Each of the Shareholders agrees that it will not create or permit to
exist any lien, claim or encumbrance at any time on any of its Shares subject to
this Agreement, other than (i) the encumbrances created by this Agreement, (ii)
securities law restrictions that may from time to time be applicable and (iii)
liens established after compliance by the Shareholder with Section 1.5 of this
Agreement.
Section 4.10. Specific Performance. Each of the parties hereto
acknowledges and agrees that in the event of any breach of this Agreement, the
non-breaching parties would be irreparably harmed and could not be made whole by
monetary damages. Each of the parties hereto accordingly agrees to waive the
defense in any action for injunction or specific performance that a remedy at
law would be adequate and that the parties hereto, in addition to any other
remedy to which they may be entitled at law or in equity, shall be entitled to
an injunction or to compel specific performance of this Agreement.
Section 4.11. Amendment. This Agreement may only be amended or modified
by the written consent of all of the Shareholders.
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SHAREHOLDERS AGREEMENT - Page 13
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IN WITNESS WHEREOF, the parties hereto have entered into this Agreement
this 25th day of January, 2000.
COMPANY:
ADDRESS:
00000 Xxxxxxxx Xxxxxxx, Xxxxx 000 MIGRATEC, INC.
Xxxxxx, Xxxxx 00000
By:
--------------------------------------
Xxxxxx Xxxxxxxxxx
President
SHAREHOLDERS:
-----------------------------------------
Xxxxxx Xxxxxxxxxx
-----------------------------------------
Xxx Xxxxxxxx
-----------------------------------------
Xxxx X. Xxxxx
-----------------------------------------
Xxxx Xxxxxxx
ADDRESS:
00000 Xxxxxxxx Xxxxxxx, Xxxxx 000
Xxxxxx, Xxxxx 00000
SHAREHOLDER AGREEMENT - Signature Page
15
00000 Xxxxxxx Xxxx, Xxxxx 000 MERCURY FUND NO. 1, LTD.
Xxxxxx, Xxxxx 00000
By: Mercury Ventures, Ltd.
Its: General Partner
By: Mercury Management, L.L.C.
Its: General Partner
By:
----------------------
Name: Xxxxx Xxxx
Its: Manager
000 Xxxxxxxx Xxxxx, Xxxxx 000 XX PARTNERS, L.P.
Xxxxxx, Xxxxx 00000
By: Cardinal Holding Corporation
Its: General Partner
By:
----------------------
Name: Xxxxxxxx Xxxxx
Its: President
SHAREHOLDER AGREEMENT - Signature Page