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EXHIBIT 10.9
XXXXXXXXXX INTERNATIONAL STOCKHOLDERS AGREEMENT
THIS XXXXXXXXXX INTERNATIONAL STOCKHOLDERS AGREEMENT ("Agreement") is
made effective as of ___________, 199_ by and among XXXXXXXXXX INTERNATIONAL,
INC., a Texas corporation, formerly known as ICO, Inc. (the "Corporation"), and
each of the holders of common stock, no par value, of the Corporation
("Corporation Common Stock") set forth on the signature pages hereof, in their
capacity as a stockholder as set forth herein (such holders collectively, the
"Stockholders"; individually, a "Stockholder").
R E C I T A L S:
WHEREAS, in furtherance of the transactions contemplated by the Merger
Agreement dated as of December ___, 1995 (the "Merger Agreement") by and among
the Corporation, W Acquisition Corp., a New Jersey corporation, and Wedco
Technology, Inc., a New Jersey corporation ("Wedco"), the parties hereto desire
to provide, through grants of irrevocable proxies, for the orderly disposition
of certain matters involving the Corporation's internal affairs and also for
the representation of the W-F Group (as defined hereinafter) on the Board of
Directors of the Corporation; and
WHEREAS, the parties desire to provide members of the W-F Group
certain authority with respect to the on going management of the Surviving
Corporation (as defined hereinafter).
NOW, THEREFORE, in consideration of the premises and the mutual
covenants and agreements contained hereinafter, the parties hereto hereby agree
as follows:
1. DEFINITIONS. As used in this Agreement, the following terms
shall have the meanings indicated below:
(a) "W-F Group" shall mean Xxxxxxx X. Xxxxxxxxxx, Xxxxx
X. Xxxxxxxxxx, Xxxxxxx X. Xxxxxxxxxx, Xxxxxx X. Xxxxxxxxxx, Xxxx X. Xxxxx, Xxxx
J.M.L. Verhoeff, Xxxxxxxxx Xxxxxxxxxx Xxxxxxx, Xxxxxxx X. Xxxxxxxxxx, as
custodian for Xxxxxxx X. Xxxxxxxxxx, and Xxxxxx X. Xxxxxxxxxx, as custodian for
Xxxxxxx X. Xxxxxxxxxx.
(b) "P Group" shall mean Pacholder Associates, Inc. and
its Subsidiaries, Xxxxxx X. Xxxxxxxxx, Xx. Xxxxx X. Xxxxxxxxx, Xxxxx X.
Xxxxxxxxx and Xxxxxxx X. Xxxxxx.
(c) "Change in Control of the Corporation" shall mean the
occurrence of any of the following:
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(i) any "person" (as defined in Section 13(d) of
the Securities Exchange Act of 1934, as amended (the "1934
Act")) or "group" (as defined in Section 13(d)(3) of the 0000
Xxx) of "persons" becomes the "beneficial owner" (as defined
in Rule 13d-3 promulgated under the 0000 Xxx) of shares of
stock or other securities of the Corporation either (i)
constituting in excess of 50% of the shares of voting stock of
the Corporation, or (ii) entitling such "person," either
immediately or with the passage of time or the occurrence of a
stated event, to exercise a majority of the voting power in
the election of directors of the Corporation; or
(ii) a majority of the Board of Directors of the
Corporation ceases to be composed of the nominees of the
Stockholders (the "Continuing Directors") or of persons
nominated by and elected to the Board of Directors of the
Corporation with the consent or approval of a majority of the
Continuing Directors; or
(iii) a sale, transfer, conveyance, assignment or
other disposition by the Corporation of all or substantially
all its assets, whether in liquidation, dissolution or
otherwise.
(d) "Initial W-F Group Board Representatives" shall mean
the three (3) persons, viz, Xxxxxxx X. Xxxxxxxxxx, Xxxxxx X. Xxxx and Xxxxxx X.
Sirusus, designated by Wedco to represent the interests of the W-F Group on the
Board of Directors of the Corporation immediately after the Effective Time.
(e) "Successor W-F Group Board Representatives" shall
mean the W-F Group Board Representatives succeeding to the offices of the
Initial W-F Group Board Representatives.
(f) "W-F Group Board Representatives" shall mean the
Initial W-F Group Board Representatives and the Successor W-F Group Board
Representatives, collectively.
(g) Capitalized terms used in this Agreement without
specific definition shall have the meanings respectively ascribed thereto in
the Merger Agreement.
2. INITIAL BOARD REPRESENTATION OF THE W-F GROUP.
(a) The W-F Group hereby confirms the designation of
Xxxxxxx X. Xxxxxxxxxx, Xxxxxx X. Xxxx and Xxxxxx X. Sirusus as the Initial W-F
Group Board Representatives and acknowledges that the Initial W-F Group Board
Representatives shall constitute three (3) members of a nine (9) member
classified Board of Directors.
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(b) The Stockholders hereby covenant to take (or to cause
to be taken) all actions necessary or appropriate to cause the election or
other designation of the Initial W-F Group Board Representatives as members of
the Corporation's Board of Directors for terms beginning immediately after the
Effective Time and ending, respectively, on the date of the Corporation's
annual stockholders meeting in 1996 (Xxxxxxx X. Xxxxxxxxxx), the date of the
Corporation's annual stockholder's meeting in 1997 (Xxxxxx X. Xxxx) and the
date of the Corporation's annual stockholders meeting in 1998 (Xxxxxx X.
Sirusus). Irrespective of the amount of Corporation Common Stock held by the
W-F Group, the Stockholders further covenant that they shall take (or cause to
be taken) all actions necessary or appropriate to renominate and re-elect
Xxxxxxx X. Xxxxxxxxxx and Xxxxxx X. Xxxx for additional three (3) year terms
as members of the Corporation's Board of Directors when their initial terms
expire, respectively, on the date of the Corporation's annual stockholders
meeting in 1996 (Xxxxxxx X. Xxxxxxxxxx) and 1997 (Xxxxxx X. Xxxx). For all
purposes of this Agreement, the service of Xxxxxxx X. Xxxxxxxxxx and Xxxxxx X.
Xxxx as members of the Corporation's Board of Directors for the additional
three (3) year terms described in the immediately preceding sentence shall be
deemed to constitute service as an Initial W-F Group Board Representative.
3. CONTINUED BOARD REPRESENTATION OF THE W-F GROUP. The P Group
hereby covenants that, until the earlier of: (i) the time that the W-F Group,
taken as a whole, beneficially owns (as defined in Rule 13d-3 promulgated under
the 0000 Xxx) less than 1,500,000 shares ("Minimum Share Level") of issued and
outstanding Corporation Common Stock; provided, however, if and whenever the
outstanding shares of Corporation Common Stock shall be combined by reverse
stock split or similar transaction into a smaller number of shares of
Corporation Common Stock, the Minimum Share Level shall be proportionately
reduced, such reduction to become effective immediately on the day upon which
such combination becomes effective; or (ii) there is a Change in Control of the
Corporation, they shall (in conjunction with the W-F Group) take (or cause to
be taken) any and all actions necessary or appropriate to have the W-F Group's
interests represented on the Corporation's Board of Directors by the Initial
W-F Group Board Representatives as and after the respective terms of service of
the Initial W-F Group Board Representatives expire.
4. VACANCIES, ETC. If any of the Initial W-F Group Board
Representatives shall cease to serve as a member of the Corporation's Board of
Directors or if, at any time when the P Group is obligated under Section 3
above to ensure W-F Group representation on the Board of Directors through W-F
Group Board Representatives, an Initial or Successor W-F Group Board
Representative shall cease to serve as a member of the Corporation's Board of
Directors, the Stockholders shall take (or cause to be taken) any and all
actions necessary or appropriate to ensure that the vacancy created by the
non-serving W-F Group Board Representative shall be filled by a person
nominated by the remaining W-F Group Board Representatives or, if there shall
be only one remaining W-F Group Board Representative, then that representative,
subject
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to the consent of a majority of the full Board of Directors, such consent not
to be unreasonably withheld and, provided, such consent shall not be deemed to
have been unreasonably withheld to the extent necessary to act in accordance
with the fiduciary duties of such Board of Directors under applicable laws (as
determined by such Board of Directors in good faith after consultation with and
based upon advice of counsel). However, if there are no remaining W-F Group
Board Representatives the vacancy (or vacancies) shall be filled in accordance
with the directions of the W-F Group acting by a majority in interest (as to
beneficial ownership of Corporation Common Stock), subject to the consent of a
majority of the full Board of Directors as set forth above herein. If the
consent by a majority of the full Board of Directors in accordance with
Sections 3 or 4 hereof is not obtained, the failure to obtain such consent
shall not affect the rights of the then-incumbent W-F Group Board
Representatives or W-F Group, as the case may be, to designate additional
person(s) to serve as W-F Group Board Representatives in accordance with the
terms hereof.
5. GRANTS OF PROXY.
(a) EFFECTIVE DURING THE TERMS OF THE INITIAL W-F GROUP
BOARD REPRESENTATIVES AND DURING THE PERIOD IN WHICH THE P GROUP IS OBLIGATED
TO ENSURE W-F GROUP REPRESENTATION ON THE BOARD OF DIRECTORS THROUGH W-F GROUP
BOARD REPRESENTATIVES (THE "P GROUP PROXY PERIOD"), EACH MEMBER OF THE P GROUP
HEREBY IRREVOCABLY GRANTS TO AND APPOINTS, XXXXXX X. XXXX AND XXXXXX X. XXXXX,
OR ANY ONE (1) OF THEM, SUCH STOCKHOLDER'S PROXY AND ATTORNEY-IN-FACT (WITH
FULL POWER OF SUBSTITUTION) FOR AND IN THE NAME, PLACE AND STEAD OF SUCH
STOCKHOLDER, TO VOTE SUCH STOCKHOLDER'S SHARES OF CORPORATION COMMON STOCK, OR
GRANT CONSENTS IN RESPECT OF SUCH SHARES OF CORPORATION COMMON STOCK, IN FAVOR
OF THE SLATE OF NOMINEES FOR THE CORPORATION'S BOARD OF DIRECTORS SELECTED BY
THE THEN-INCUMBENT MEMBERS OF THE CORPORATION'S BOARD OF DIRECTORS (THE
"NOMINATED SLATE"). EACH SUCH MEMBER OF THE P GROUP AFFIRMS THAT THIS
IRREVOCABLE PROXY IS COUPLED WITH AN INTEREST AND MAY UNDER NO CIRCUMSTANCES BE
REVOKED DURING THE P GROUP PROXY PERIOD. SUCH IRREVOCABLE PROXY IS EXECUTED
AND INTENDED TO BE IRREVOCABLE IN ACCORDANCE WITH THE PROVISIONS OF ARTICLE
2.29 OF THE TEXAS BUSINESS CORPORATION ACT (THE "TEXAS ACT").
(b) EFFECTIVE WHILE ANY W-F GROUP MEMBERS OWNS
CORPORATION COMMON STOCK AND UNTIL THERE SHALL HAVE OCCURRED A CHANGE IN
CONTROL OF THE CORPORATION (THE "W-F GROUP PROXY
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PERIOD"), EACH MEMBER OF THE W-F GROUP HEREBY IRREVOCABLY GRANTS TO, AND
APPOINTS, XXXXXX X. XXXXXXXXX AND XX. XXXXX X. XXXXXXXXX, OR ANY ONE (1) OF
THEM, SUCH STOCKHOLDER'S PROXY AND ATTORNEY-IN-FACT (WITH FULL POWER OF
SUBSTITUTION) FOR AND IN THE NAME, PLACE AND STEAD OF SUCH STOCKHOLDER, TO VOTE
SUCH STOCKHOLDER'S SHARES OF CORPORATION COMMON STOCK, OR GRANT CONSENTS IN
RESPECT OF SUCH SHARES OF CORPORATION COMMON STOCK, IN FAVOR OF THE NOMINATED
SLATE. EACH SUCH MEMBER OF THE W-F GROUP AFFIRMS THAT THIS IRREVOCABLE PROXY
IS COUPLED WITH AN INTEREST AND MAY UNDER NO CIRCUMSTANCES BE REVOKED DURING
THE W-F GROUP PROXY PERIOD. SUCH IRREVOCABLE PROXY IS EXECUTED AND INTENDED TO
BE IRREVOCABLE IN ACCORDANCE WITH ARTICLE 2.29 OF THE TEXAS ACT.
6. DIRECTORS AND OFFICERS OF THE SURVIVING CORPORATION. Xxxxxx
X. Xxxxxxxxx shall be President and Chief Executive Officer ("CEO") of the
corporation surviving the merger of Wedco with and into W Acquisition and any
successor through which the merged corporation operates its business in the
United States (the "Surviving Corporation") from and after the Effective Time.
Xx. Xxxxx O. Pacholder shall be Chairman of the Board and Chief Operating
Officer ("COO") of the Surviving Corporation from and after the Effective Time.
The Articles of Incorporation of the Surviving Corporation
shall provide that: the President, Chairman of the Board, CEO, COO, or any
person who shall hold any other office, position or title having similar
functions or authority to the functions of Chairman of the Board, CEO,
President or COO, or who shall have equivalent operating authority of the
Surviving Corporation, shall be elected by a unanimous vote of the Board of the
Surviving Corporation.
The Corporation (Xxxxxxxxxx International, Inc.) hereby agrees
to elect as a Director of the Surviving Corporation (as defined in this
Section) Xxxxxxx X. Xxxxxxxxxx and if Xxxxxxx X. Xxxxxxxxxx shall be unable or
shall, for any reason, cease to serve, the Corporation shall elect Xxxxxx X.
Xxxx, Esquire, as Director. In the event that Xxxxxx X. Xxxx shall be unable
or shall cease for any reason to act as a Director, the Corporation shall elect
Xxxxxx X. Xxxxx, Esquire, to act as Director of the Surviving Corporation. If
Xxxxxx X. Xxxxx, Esquire, shall be unable or shall cease for any reason to act
as a Director, then the Corporation shall elect as a Director of the Surviving
Corporation such person as is nominated by the W-F Group Representatives on the
Board of Directors of the Corporation.
It is the intent of the parties to this Agreement, in
consideration of this Agreement and of the Merger Agreement, with the exception
of the election of Xx. Xxxxx X. Xxxxxxxxx and Xxxxxx X. Xxxxxxxxx any person
holding the office or title of President, CEO, Chairman, COO, or who shall hold
any other office, position or title having similar functions or authority to
the
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functions of Chairman of the Board, CEO, President or COO, or who shall have
equivalent operating authority of the Surviving Corporation or Wedco, Inc. (or
any successor through which the Surviving Corporation operates its business in
the United States), will not be elected without the approval of the W-F Group
Board Representative.
7. RESTRICTION ON BLOCK TRANSFERS OF W-F GROUP AND P GROUP SHARES
OF CORPORATION COMMON STOCK. Except as expressly set forth in this Section 7,
nothing in this Agreement shall be deemed to constitute a restriction on the
right, power or authority of any member of the W-F Group or P Group, as the
case may be, to sell, convey or otherwise transfer, after the Effective Time,
any shares of Corporation Common Stock owned by him, her or it. However, if
any one (1) or more members of the W-F Group or P Group, as the case may be,
desire to sell, convey or otherwise transfer Five Hundred Thousand (500,000) or
more shares of Corporation Common Stock to any person (as defined in Section
13(d) of the Securities Exchange Act of 1934, as amended (the "1934 Act")) or
group of persons (as defined in Rule 13d-5 promulgated under the 1934 Act),
other than to an underwriter or underwriter group in connection with an
underwritten public offering that would not result in a transfer or transfers
of Five Hundred Thousand (500,000) or more shares of Corporation Common Stock,
to any person (as defined in Section 13(d) of the 0000 Xxx) or group of persons
(as defined in Rule 13d-5 promulgated under the 1934 Act), in a single
transaction or series of related transactions, such proposed sale, conveyance
or other transfer shall not be effective, and the Corporation shall have no
obligation to register the transfer of such shares of Corporation Common Stock
unless and until the proposed vendee or transferee agrees to be bound as
regards the obligations (but not the rights) of a W-F Group member or P Group
member, as the case may be, by this Agreement as though an original member of
the W-F Group or P Group, as the case may be. The members of the W-F Group and
P Group (and each of them) agree that the foregoing limited restriction on
transfer is necessary to achieve the purposes of this Agreement and that the
other Stockholders and the Corporation shall be entitled to obtain injunctive
relief (including, without limitation, a permanent mandatory injunction) and
specific performance in the event of a breach or threatened breach of the
foregoing limited restriction on transfer. The certificates evidencing the
shares of Corporation Common Stock held by the members of the W-F Group and P
Group shall bear a legend referring to the provisions of this Section 7.
Notwithstanding the foregoing, the restrictions set forth above shall not apply
to transfers of Corporation Common Stock by the holders of partnership
interests of P M Special Fund, Limited Partnership and O P Limited Partnership
upon the termination or expiration of such partnerships in accordance with the
terms of their respective partnership agreements.
8. ENDORSEMENT ON STOCK CERTIFICATES. It is understood that all
of the Certificates representing shares of Corporation Common Stock owned by
the W-F Group or the P Group will be endorsed as follows:
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"THE SHARES REPRESENTED BY THIS CERTIFICATE MAY NOT BE
TRANSFERRED UNLESS EITHER A REGISTRATION STATEMENT WITH
RESPECT THERETO IS IN EFFECT UNDER THE SECURITIES ACT OF 1933
OR, IN THE OPINION OF THE CORPORATION'S COUNSEL, AN EXEMPTION
FROM THE REGISTRATION PROVISIONS OF SAID ACT IS THEN AVAILABLE
UNDER SAID ACT OR ANY RULE OR REGULATION OF THE SECURITIES AND
EXCHANGE COMMISSION THEREUNDER OR SIMILAR ENDORSEMENT."
The removal of such endorsement requires the opinion of
counsel of the Corporation. Any transfer which comes to the attention of
counsel for the Corporation which shall reasonably appear to be in violation of
Section 7 hereof may be held up by said counsel provided said counsel shall, by
the end of the next business day after the receipt of the request for an
opinion for the transfer of the shares, contract the transferor questioning
whether the transfer of the Corporation Common Stock is in violation of Section
7 and said counsel shall give to the transferor the basis upon which said
counsel shall reasonably believe that the transfer is in violation of Section 7
hereof. The transferor of the shares of Corporation Common Stock shall advise
said counsel whether, to the best of transferor's knowledge, taking into
consideration the information given by counsel to the transferor, said transfer
is in violation of Section 7 and if it is not, said transferor will forward to
said counsel a letter which shall include the following:
"The transfer of the shares of Xxxxxxxxxx International, Inc.
Common Stock being made by me and subject to your inquiry of
[date] are not, to the best of my knowledge, taking into
consideration facts supplied by you in the said inquiry, being
transferred in violation of Section 7 of the Xxxxxxxxxx
International Stockholders Agreement dated the _____ day of
______________, 1995.
"It is understood that the transfer is being approved in
reliance upon this statement.
____________________________________
Transferor"
The receipt of such statement by corporate counsel shall
constitute conclusive evidence to the said corporate counsel that the transfer
is not in violation of Section 7 hereof and
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said corporate counsel shall, without further delay, give the opinion required
for the transfer of the shares. Until such time as corporate counsel receives
the foregoing statement signed by the transferor, corporate counsel may deem
that the shares are in violation of Section 7 and corporate counsel shall not
be required to complete the transfer.
The parties subject to Section 7 shall keep corporate counsel
advised of their address and facsimile numbers so that all inquiries to be made
hereunder may be made quickly. All inquiries and responses shall be made by
either facsimile or overnight private couriers. It is the intention hereof
that there shall be no unreasonable delay in the transfer of the said shares of
Corporation Common Stock if the said transfer is not in violation of Section 7.
Counsel for the Corporation shall not question transfers of 100,000 shares or
less unless the same appears to be part of a series which could reasonably be
believed to be in violation of Section 7 hereof.
9. SPECIFIC PERFORMANCE. The parties hereto agree that if any of
the provisions of this Agreement were not performed in accordance with their
specific terms or were otherwise breached, irreparable damage would occur, no
adequate remedy at law would exist and damages would be difficult to determine,
and that the parties shall be entitled to specific performance of the terms
thereof, in addition to any other remedy at law or equity.
10. SEVERABILITY. If any term or other provision of this
Agreement is invalid, illegal or incapable of being enforced by any rule of
law, or public policy, and as a result thereof, the economic or legal substance
of this Agreement is affected in a manner materially adverse to a party hereto,
the materially adversely affected party may terminate this Agreement upon
notice to the other parties hereto. Upon a determination that any term or
other provision is invalid, illegal or incapable of being enforced, and, as a
result thereof, the economic or legal substance of this Agreement is not
affected in a manner materially adverse to a party hereto, the parties hereto
shall negotiate in good faith to modify this Agreement so as to effect the
original intent of the parties in order that the terms of this Agreement remain
as originally contemplated to the fullest extent possible.
11. MISCELLANEOUS. This Agreement shall be construed under and
governed by the internal substantive laws of the State of Texas applicable to
contracts negotiated, executed and wholly performed within the State of Texas
except for matters pertaining to Section 6 hereof, to which the laws of the
State of New Jersey shall be applicable in the same manner as contracts
negotiated, executed and wholly performed within the State of New Jersey. This
Agreement may not be amended or modified without the prior written consent of
all the parties hereto. If any court or other tribunal of competent
jurisdiction should find any provision of this Agreement to be unenforceable,
said court or other tribunal shall sever the unenforceable provision and
enforce the remaining provisions as originally executed and delivered.
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12. COUNTERPARTS. This Agreement may be executed in two or more
counterparts, all of which shall be considered one and the same agreement and
shall become effective as to any Stockholder when one or more counterparts have
been signed by each of the Corporation and such Stockholder and delivered to
the Corporation and such Stockholder.
13. INTERPRETATION. The descriptive headings contained herein are
for convenience of reference only and shall not affect in any way the meaning
or interpretation of this Agreement.
14. LEGAL OPINION. Prior to or simultaneous with the execution of
this Agreement, the Stockholders and the Corporation shall have received an
opinion from Xxxxxx & Xxxxxx in form and substance reasonably satisfactory to
them, substantially to the effect that, this Agreement creates legal, valid and
binding obligations of the parties hereto and is enforceable in accordance with
its terms under the laws of the State of Texas.
15. TERMINATION. This Agreement shall terminate: (i) with the
consent of the Corporation and the Stockholders party to this Agreement; or
(ii) upon the occurrence of an event described in Section 3(i) or (ii).
IN WITNESS WHEREOF, the undersigned have hereunto set their respective
hands effective as of the date and year first above written.
XXXXXXXXXX INTERNATIONAL, INC.
By:________________________________
Name:
Title:
THE STOCKHOLDERS:
________________________________________
XXXXXXX X. XXXXXXXXXX
________________________________________
XXXXX X. XXXXXXXXXX
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________________________________________
XXXXXXX X. XXXXXXXXXX
________________________________________
XXXXXX X. XXXXXXXXXX
________________________________________
XXXX X. XXXXX
________________________________________
THEO J.M.L. VERHOEFF
________________________________________
XXXXXXX X. XXXXXXXXXX, AS
CUSTODIAN FOR XXXXXXX X.
XXXXXXXXXX
________________________________________
XXXXXX X. XXXXXXXXXX, AS
CUSTODIAN FOR XXXXXXX X.
XXXXXXXXXX
________________________________________
XXXXXXXXX XXXXXXXXXX XXXXXXX
________________________________________
XXXXXX X. XXXXXXXXX
________________________________________
XX. XXXXX X. XXXXXXXXX
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________________________________________
XXXXX X. XXXXXXXXX
________________________________________
XXXXXXX X. XXXXXX
PACHOLDER ASSOCIATES, INC.
By:_____________________________________
Its:____________________________________
P M DELAWARE, INC.
By:_____________________________________
Its:____________________________________
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