THIS STOCKHOLDERS AGREEMENT (this "Agreement"), dated as of October 17,
1997, is among Acquisition Holdings, Inc., a Delaware corporation ("Holdco"),
and the stockholders (the "Stockholders") of ATC Group Services Inc. (the
"Company") signatory hereto.
RECITALS
WHEREAS, Holdco has simultaneously herewith delivered to the Company an
offer letter, dated October 17, 1997, from Xxxxx, Xxxx & Xxxxx, L.L.C., attached
hereto as Exhibit A, pursuant to which Holdco through a subsidiary would enter
into a business combination with the Company (the "Transaction") pursuant to an
agreement and plan of merger in the form attached hereto as Exhibit B (as the
same may be negotiated and entered into by Holdco and/or its affiliates and the
Company, the "Merger Agreement") in accordance with which Holdco would acquire
the entire equity interest in the Company for $12 per share of Common Stock; and
WHEREAS, the Stockholders have agreed to vote 14.99% in the aggregate of
the Common Stock of the Company in favor of the Transaction and Holdco and the
Stockholders desire to memorialize certain other agreements, all as set forth
herein.
NOW, THEREFORE, in consideration of the foregoing and the mutual covenants
and agreements herein contained and for other good and valuable consideration,
the receipt and adequacy of which is hereby acknowledged, the parties hereto,
intending to be legally bound, hereby agree as follows:
AGREEMENT
1. Certain Definitions. For purposes of this Agreement:
"Acquisition Proposal" shall mean any inquiry, proposal or offer from any
Person relating to any direct or indirect acquisition or purchase of 15% or more
of the assets of the Company and its subsidiaries or 15% or more of any class of
equity securities of the Company or any of its subsidiaries, any tender offer or
exchange offer that if consummated would result in any Person beneficially
owning 15% or more of any class of equity securities of the Company or any of
its subsidiaries, any merger, consolidation, business combination, sale of
substantially all the assets, recapitalization, liquidation, dissolution or
similar transaction involving the Company or any of its subsidiaries, other than
the Transaction, or any other transaction the consummation of which could
reasonably be expected to impede, interfere with, prevent or materially delay
the Transaction or which would reasonably be expected to dilute materially the
benefits to Holdco of the Transaction.
"Beneficially Own" or "Beneficial Ownership" with respect to any securities
shall mean having "beneficial ownership" of such securities (as determined
pursuant to Rule 13d-3 under the Securities Exchange Act of 1934, as amended
(the "Exchange Act")), including pursuant to any agreement, arrangement or
understanding, whether or not in writing. Without duplicative counting of the
same securities by the same holder, securities Beneficially Owned by a Person
shall include securities Beneficially Owned by all other Persons with whom such
Person would constitute a "group" within the meaning of Section 13(d) of the
Exchange Act.
"Closing Date" shall mean the date set forth in the Merger Agreement, if
executed and delivered, as the closing date for the Transaction.
"Common Stock" shall mean at any time the Common Stock, par value $.01 per
share, of the Company.
"Existing Shares" shall mean the shares of Common Stock owned by the
Stockholders on the date hereof.
"Permitted Transfer" means a sale, transfer, assignment or other
disposition to a Permitted Transferee.
"Permitted Transferee" means any person who is (A) the spouse or former
spouse of, or any lineal descendent of, or any spouse of such lineal descendant
of, or the grandparent, parent, brother or sister of, or spouse of such brother
or sister of, either of the Stockholders or of a Permitted Transferee; (B) upon
the death of any of the Stockholders or any Permitted Transferee of such person,
the executors of the estate of such Stockholder or such Permitted Transferee,
and any of such Stockholder's or such Permitted Transferee's heirs, testamentary
trustees, devisees, or legatees; (C) any trust for the benefit of one or more of
the Stockholders or Permitted Transferees; (D) upon the disability of either of
the Stockholders or any Permitted Transferee, any guardian or conservator of
such Stockholder or such Permitted Transferee; (E) any corporation, partnership
or other entity if at least 95% of the beneficial ownership is held by either
Stockholder individually or by the Stockholders in the aggregate or Permitted
Transferees, or (F) a lending institution in whose favor either of the
Stockholders pledges or otherwise grants a security interest in any or all of
the Proxy Shares (as defined herein) for the purpose of obtaining one or more
bona fide loans or advances for the exercise of options, warrants or other
rights held by either Stockholder to acquire shares of Common Stock; provided,
that in each case such transferee (in the case of a transferee under clause (F)
above, on behalf of itself and any transferee of the collateral) assumes and
agrees to perform and becomes a party to this Agreement, agrees not to make an
Acquisition Proposal, and agrees not to dissent in the Transaction, all on terms
reasonably acceptable to Holdco. For purposes of this Agreement, when a
Permitted Transferee has acquired Shares in accordance herewith, such person
shall be deemed a "Stockholder" hereunder.
"Person" shall mean an individual, corporation, limited liability company,
partnership, joint venture, association, trust, unincorporated organization or
other entity.
"Shares" shall mean the Existing Shares and any right to acquire shares of
Common Stock owned on the date hereof and any shares of Common Stock or rights
to acquire shares of Common Stock acquired by any Stockholder in any capacity
after the date hereof and prior to the termination of this Agreement. "Shares"
shall include (i) shares of Common Stock acquired upon the exercise of options,
warrants or other rights to acquire shares; (ii) shares of Common Stock acquired
upon the conversion or exchange of convertible or exchangeable securities; (iii)
shares of Common Stock acquired by means of purchase, dividend, distribution,
gift, bequest, inheritance or as a successor in interest in any capacity or
otherwise; and (iv) rights to acquire shares of Common Stock, vested or not,
presently exercisable or not, including, but not limited to, options and
warrants. In the event of a stock dividend or distribution, or any change in the
Common Stock by reason of any stock dividend, split-up, recapitalization,
reclassification, combination, exchange of shares or the like, the term "Shares"
shall be deemed to refer to and include the Shares as well as all such stock
dividends and distributions and any shares into which or for which any or all of
the Shares may be changed, reclassified or exchanged and appropriate adjustments
shall be made to the terms and provisions of this Agreement. "Shares" shall also
include voting trust certificates issued in respect of any Shares.
2. Voting of Shares; No Inconsistent Agreements.
(a) With respect to the Shares identified as Proxy Shares on Exhibit C
attached hereto (the "Proxy Shares"), each Stockholder, subject to the terms of
this Agreement, hereby irrevocably grants to, and appoints, Holdco and any other
Person who shall hereafter be designated by Holdco, 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 Proxy Shares, or grant
a consent or approval in respect of such Proxy Shares, at any meeting of
stockholders of the Company or at any adjournment thereof or in any other
circumstances upon which their vote, consent or other approval is sought, (i) in
favor of (A) the Transaction, (B) the Merger Agreement and (C) the transactions
contemplated by the Merger Agreement, including, but not limited to, the
amendments to the Certificate of Incorporation of the Company contemplated
thereby and (ii) against (other than in connection with the Transaction) (A) any
extraordinary corporate transaction, such as a merger, consolidation or other
business combination involving the Company or any of its subsidiaries (other
than the Transaction); (B) any sale, lease or transfer by the Company of a
material amount of assets (including stock) of the Company or any of its
subsidiaries, or a reorganization, restructuring, recapitalization, special
dividend, dissolution or liquidation of the Company or any of its subsidiaries;
and (C)(1) any change in a majority of the persons who constitute the board of
directors of the Company or any of its subsidiaries; (2) any change in the
present capitalization of the Company or any of its subsidiaries including any
proposal to sell a substantial equity interest in the Company or any of its
subsidiaries; (3) any amendment of the Company or any of its subsidiaries'
charters or by-laws; (4) any other change in the Company or any of its
subsidiaries' corporate structure or business; and (5) any other action which,
in the case of each of the matters referred to in clauses (C)(1), (2), (3) or
(4), is intended, or could reasonably be expected, to impede, interfere with,
delay, postpone, or materially adversely affect the Transaction and the
transactions contemplated by this Agreement and the Merger Agreement.
(b) Such Stockholder represents that any proxies previously given in
respect of such Stockholder's Proxy Shares are not irrevocable, and that any
such proxies are hereby revoked.
(c) Such Stockholder hereby affirms that the irrevocable proxy set forth in
this Section 2 is given to secure the performance of the duties of the
Stockholder under this Agreement. Such Stockholder hereby further affirms that
such irrevocable proxy is coupled with an interest and may under no
circumstances be revoked, except in connection with the termination of this
Agreement pursuant to Section 7 hereof. Such Stockholder hereby ratifies and
confirms all that such irrevocable proxy may lawfully do or cause to be done by
virtue hereof. Such irrevocable proxy is executed and intended to be irrevocable
in accordance with the provisions of Section 212(e) of the Delaware General
Corporation Law.
(d) Each Stockholder severally and not jointly agrees that it shall not
enter into any agreement or understanding with any Person the effect of which
would be inconsistent with or violative of the provisions and agreements
contained herein, including in this Section 2. Further, from the date hereof
until such time as Holdco's designees shall constitute a majority of the members
of the Board of Directors of the Company, each Stockholder severally and not
jointly agrees that it will, if the Board of Directors of the Company fails or
refuses to submit the Transaction to the Company stockholders, vote all Proxy
Shares held of record or Beneficially Owned by such Stockholder to (i) call or
cause to be called a special meeting of stockholders of the Company (or effect a
written consent) to remove the directors of the Company who have so failed or
refused, or to increase the size of the Board of Directors and elect a majority
of new directors who will submit the Transaction to the stockholders of the
Company for a vote, and (ii) use its reasonable efforts to vote such Proxy
Shares to effect such removal and replacement, or increase and election, and the
submission of the Transaction to the stockholders of the Company; and (iii), at
any time after initial approval by the stockholders of the Company of the
Transaction, if so requested by Holdco, vote such Proxy Shares to approve all or
any actions incident to the Transaction or the other matters referred to in this
Section 2 by stockholder written consent.
3. Other Stockholder Covenants.
(a) Restriction on Transfer; Proxies and Non-interference. From the date
hereof through the Closing Date or the earlier termination of this Agreement in
accordance with its terms, and except for Permitted Transfers as expressly
permitted herein and subject to Section 3(f), each Stockholder severally and not
jointly agrees that it shall not directly or indirectly:
(i) offer for sale, sell, transfer, tender, pledge, encumber, assign
or otherwise dispose of, or enter into any contract, option or other arrangement
or understanding with respect to, or consent to the offer for sale, sale,
transfer, tender, pledge, encumbrance, assignment or other disposition of
(collectively, "transfer"), any or all of the Proxy Shares or any interest
therein;
(ii) grant any proxies or powers of attorney with respect to the Proxy
Shares, deposit the Proxy Shares into a voting trust or enter into a voting
agreement with respect to the Proxy Shares; or
(iii) take any action that would make any representation or warranty
of such Stockholder contained herein untrue or incorrect or would result in a
breach by such Stockholder of its obligations under this Agreement.
(b) No Solicitation.
Subject to Section 3(f), from the date hereof until the Closing Date, or
the earlier termination of this Agreement in accordance with Section 7 hereof,
each Stockholder severally and not jointly agrees that such Stockholder shall
not, and shall not permit any of such Stockholder's representatives, agents or
affiliates (including, without limitation, any investment banker, attorney or
accountant retained by any Stockholder) to, directly or indirectly, enter into,
solicit, initiate or continue any discussions or negotiations with, or provide
any information to, or otherwise cooperate in any other way with, any Person or
group, other than Holdco and its affiliates, concerning any offer or proposal
which constitutes or is reasonably likely to lead to an Acquisition Proposal.
Each Stockholder severally and not jointly agrees that it will immediately
notify Holdco orally and in writing if any discussions or negotiations are
sought to be initiated, any inquiry or proposal is made, or any information is
requested with respect to any Acquisition Proposal or which could lead to an
Acquisition Proposal, and immediately notify Holdco of all material terms of any
proposal which it may receive in respect of any such Acquisition Proposal,
including the identity of the prospective purchaser or soliciting party if
known, and thereafter shall inform Holdco on a timely, ongoing basis of the
status and content of any discussions or negotiations with such a third party,
including immediately reporting any material changes to the terms and conditions
thereof.
(c) Reliance. Each Stockholder understands and acknowledges that Holdco is
proposing to enter into the Transaction in reliance upon each Stockholder's
execution and delivery of this Agreement.
(d) Further Assurances. From time to time, at Holdco's request and without
further consideration, each Stockholder severally and not jointly agrees that it
shall execute and deliver such additional documents and take all such further
lawful action as may be necessary or desirable to consummate and make effective,
in the most expeditious manner practicable, the purposes of this Agreement.
(e) Stockholder Termination Fee. In the event that any Acquisition Proposal
is consummated, then each Stockholder shall pay to Holdco as soon as
practicable, but in no event longer than two business days after receipt of the
consideration paid to such Stockholder in connection with such Acquisition
Proposal an amount (the "Stockholder Termination Fee") equal to the product of
(x) the number of Shares Beneficially Owned by such Stockholder, multiplied by
(y) the excess of the per share value of consideration paid or payable in
consequence of consummation of the Acquisition Proposal (with the value of any
non-cash consideration being determined by agreement of Holdco and such
Stockholder or, failing such agreement within 10 business days of consummation
of such Acquisition Proposal, as provided below) over $12. In the case of
options on Shares, to the extent the same are cancelled for a payment in cash
(the "Option Payment"), the amount due hereunder shall be the amount by which
the Option Payment exceeds the product of (a) the number of Shares underlying
such options and (b) $12. In the event that the consideration paid or payable in
consequence of consummation of the Acquisition Proposal: (i) consists solely of
cash, then the Stockholder Termination Fee shall be payable solely in cash, or
(ii) consists of cash and other non-cash property, or solely non-cash property,
then the Stockholder Termination Fee shall be payable in cash and such non-cash
property in the same proportion as the cash bears to the value of the non-cash
property issued or issuable in consequence of consummation of the Acquisition
Proposal (as such value is determined herein).
If Holdco and such Stockholder fail to agree promptly on the value of such
non-cash consideration, then the parties shall appoint an independent investment
banking firm reasonably acceptable to Holdco and such Stockholder to act as
arbitrator (the "Arbitrator"). Upon the selection of the Arbitrator, Holdco on
the one hand and such Stockholder on the other shall deliver to the Arbitrator
and to each other their last and final offer concurrently in writing (the
"Certified Offers"). The Certified Offers shall list one amount which the
submitting party asserts is the appropriate valuation of such non-cash
consideration as of the date of submittal. The Arbitrator's sole role shall be
to select which one of the two Certified Offers most closely approximates the
valuation the Arbitrator would have determined for such non-cash consideration,
taking into account current market valuations of any publicly traded securities
which constitute such non-cash consideration. The Arbitrator shall notify the
parties of such determination. The determination of the Arbitrator shall be
binding on the parties. All costs and expenses of the Arbitrator shall be borne
by the parties whose Certified Offer is not selected.
Each Stockholder acknowledges that the agreements contained in this Section
3(e) are an integral part of the transactions contemplated by this Agreement and
the Transaction. Accordingly, if the Stockholder shall fail to pay when due any
amounts which shall become due under Section 3(e) hereof, the Stockholder shall
in addition hereto pay to Holdco all costs and expenses (including fees and
disbursements of counsel) incurred in collecting such overdue amounts, together
with interest on such overdue amounts from the date such payment was required to
be made until the date such payment is received at a rate per annum equal to the
Prime Rate as announced from time to time by Citibank, N.A. as its "prime rate,"
"reference rate," "base rate" or other similar rate. Any payment required to be
made pursuant to this Section 3(e) shall be made when due by wire transfer of
immediately available funds to an account designated by Holdco.
The parties agree and acknowledge that in the event that any Acquisition
Proposal is consummated, it would be impracticable and extremely difficult to
ascertain with certainty the amount of damages to Holdco. Therefore, the parties
agree that payment of the Stockholder Termination Fee pursuant to this Section
3(e) shall represent full liquidated damages. The parties agree that no party
shall be liable for special, indirect, incidental or consequential damages of
any nature arising from this Agreement.
(f) Fiduciary Duty of Directors. Holdco agrees and acknowledges that each
Stockholder is a director of the Company, and, in such capacity, has fiduciary
duties to the stockholders of Company. Nothing in this Agreement (including,
without limitation, Section 3(b)) shall be deemed to limit or affect the
obligation of each Stockholder, as a director of the Company, to take any and
all action as may be necessary in the exercise of his fiduciary duty to the
stockholders of the Company.
4. Representations and Warranties of Stockholders. Each Stockholder hereby
severally and not jointly (and solely with respect to itself and the Shares held
of record or Beneficially Owned by such Stockholder) represents and warrants to
Holdco as follows:
(a) Ownership of Shares. Such Stockholder is the record and/or Beneficial
Owner of the Existing Shares set forth on Exhibit C hereto. On the date hereof,
the Existing Shares constitute all of the Shares owned of record or Beneficially
Owned by such Stockholder. With respect to the number of shares set forth
opposite such Stockholder's name on Exhibit C hereto, and with the exceptions
noted thereon, if any, such Stockholder has sole voting power and sole power to
issue instructions with respect to the matters set forth in Sections 2 and 3
hereof, sole power of disposition, sole power of conversion, sole power to
demand appraisal rights and sole power to agree to all of the matters set forth
in this Agreement, in each case with respect to all of the Existing Shares with
no limitations, qualifications or restrictions on such rights, subject to
applicable securities laws and the terms of this Agreement.
(b) Due Authorization. Such Stockholder has all requisite capacity, power
and authority to execute and deliver this Agreement and perform its obligations
hereunder. This Agreement has been duly and validly executed and delivered by
such Stockholder and constitutes a valid and binding agreement enforceable
against such Stockholder in accordance with its terms except to the extent (i)
such enforcement may be limited by applicable bankruptcy, insolvency or similar
laws affecting creditors rights and (ii) the remedy of specific performance and
injunctive and other forms of equitable relief may be subject to equitable
defenses and to the discretion of the court before which any proceeding therefor
may be brought.
(c) No Conflicts. Except for filings, authorizations, consents and
approvals contemplated by the Transaction and necessary for the consummation of
the transactions contemplated hereby and thereby, (i) no filing with, and no
permit, authorization, consent or approval of, any state or federal public body
or authority is necessary for the execution of this Agreement by such
Stockholder and the consummation by such Stockholder of the transactions
contemplated hereby and (ii) none of the execution and delivery of this
Agreement by such Stockholder, the consummation by such Stockholder of the
transactions contemplated hereby or compliance by such Stockholder with any of
the provisions hereof shall (A) result in a violation or breach of, or
constitute (with or without notice or lapse of time or both) a default (or give
rise to any third party right of termination, cancellation, material
modification or acceleration) under any of the terms, conditions or provisions
of any note, loan agreement, bond, mortgage, indenture, license, contract,
commitment, arrangement, understanding, agreement or other instrument or
obligation of any kind to which such Stockholder is a party or by which such
Stockholder or any of its properties or assets may be bound, or (B) violate any
order, writ, injunction, decree, judgment, statute, rule or regulation
applicable to such Stockholder or any of its properties or assets.
(d) No Encumbrances. Except as set forth on Exhibit C or as otherwise
permitted herein, the Shares and the certificates representing such Shares are
now, and at all times during the term hereof, will be, held by such Stockholder,
or by a nominee, custodian or trust for the benefit of such Stockholder, free
and clear of all liens, claims, security interests, proxies, voting trusts or
agreements, understandings or arrangements or any other encumbrances whatsoever,
except for any such arising hereunder.
(e) No Finder's Fees. No broker, investment banker, financial advisor or
other Person is entitled to any broker's, finder's, financial adviser's or other
similar fee or commission in connection with the transactions contemplated
hereby based upon arrangements made by or on behalf of such Stockholder.
5. Representations and Warranties of Holdco. Holdco represents and warrants
to the Stockholders as follows:
(a) Organization. Holdco is a corporation duly organized, validly existing
and in good standing under the laws of its state of incorporation, and has all
requisite corporate power or other power and authority to execute and deliver
this Agreement and perform its obligations hereunder. The execution and delivery
by Holdco of this Agreement and the performance by Holdco of its obligations
hereunder have been duly and validly authorized by its Board of Directors and,
except as contemplated in the Transaction, no other corporate proceedings on the
part of Holdco are necessary to authorize the execution, delivery or performance
of this Agreement or the consummation of the transactions contemplated hereby.
(b) Agreement. This Agreement has been duly and validly executed and
delivered by Holdco and constitutes a valid and binding agreement of Holdco
enforceable against Holdco in accordance with its terms, except that (i) such
enforcement may be subject to applicable bankruptcy, insolvency, or other
similar laws, now or hereafter in effect, affecting creditors' rights generally,
and (ii) the remedy of specific performance and injunctive and other forms of
equitable relief may be subject to equitable defenses and to the discretion of
the court before which any proceedings therefor may be brought.
(c) No Conflicts. Except for filings, authorizations, consents, and
approvals contemplated by the Transaction and necessary for the consummation of
the transactions contemplated hereby and thereby, (i) no filing with, and no
permit, authorization, consent or approval of, any state or federal public body
or authority is necessary for the execution of this Agreement by Holdco and the
consummation by Holdco of the transactions contemplated hereby, and (ii) none of
the execution and delivery of this Agreement by Holdco, the consummation by
Holdco of the transaction contemplated hereby or compliance by Holdco with any
of the provisions hereof shall (A) conflict with or result in any breach of the
charter or bylaws of Holdco, (B) result in a violation or breach of, or
constitute (with or without notice or lapse of time or both) a default (or give
rise to any third-party right of termination, cancellation, material
modifications or acceleration) under any of the terms, conditions or provisions
of any note, loan agreement, bond, mortgage, indenture, license, contract,
commitment, arrangement, understanding, agreement or other instrument or
obligation of any kind to which Holdco is a party or by which Holdco of its
properties or assets may be bound, or (C) violate any order, writ, injunction,
decree, judgment, statute, rule or regulation applicable to Holdco or its
respective properties or assets.
6. Legend.
(a) Each Stockholder severally and not jointly agrees with, and covenants
to, Holdco that such Stockholder shall not request that the Company register the
transfer (by book-entry or otherwise) of any certificate or uncertificated
interest representing any of the Proxy Shares, unless such transfer is in
compliance with this Agreement.
(b) Each Stockholder severally and not jointly agrees that it shall
promptly after the date hereof surrender to Holdco all certificates representing
the Proxy Shares held by such Stockholder, and Holdco shall place the following
legend on such certificates, which legend, except as otherwise expressly
provided in this Agreement, shall remain on such certificates until the
termination of this Agreement:
"THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO AN
AGREEMENT, DATED AS OF OCTOBER 17, 1997 AMONG CERTAIN STOCKHOLDERS AND
ACQUISITION HOLDINGS, INC. THE SHARES ARE SUBJECT TO RESTRICTIONS ON
TRANSFER OR ENCUMBRANCE AND VOTING. A COPY OF THE AGREEMENT IS
AVAILABLE AT THE PRINCIPAL OFFICE OF THE COMPANY."
7. Termination. This Agreement shall terminate upon the earlier to occur of
(i) the Closing Date and (ii) that date which is one year after the date hereof;
provided, however, if Holdco shall have breached its obligations under this
Agreement or the Merger Agreement, then this Agreement shall terminate in all
respects (including, without limitation, Section 3(e)) 150 days after the date
hereof unless Holdco breaches its obligations under Section 10(a), in which case
this Agreement shall terminate immediately upon such breach. Notwithstanding the
immediately preceding sentence, the parties hereto agree that the provisions of
Section 3(e) (but only to the extent an Acquisition Proposal is made, proposed,
communicated, disclosed or consummated prior to termination hereunder) and
Section 8 shall survive any termination of this Agreement, and that no such
termination shall relieve any party of liability for a breach hereof prior to
termination.
8. Confidentiality and Public Announcements. The parties recognize that
successful consummation of the transactions contemplated by this Agreement may
be dependent upon confidentiality with respect to the matters referred to
herein. In this connection, pending public disclosure thereof, each of the
parties hereto severally and not jointly agrees not to disclose or discuss such
matters with anyone not a party to this Agreement (other than its counsel,
advisors, corporate parents and affiliates) without the prior written consent of
the other parties hereto, except for filings required pursuant to the Exchange
Act and the rules and regulations thereunder or disclosures its counsel advises
are necessary in order to fulfill its obligations imposed by law or the
requirements of any securities exchange. At all times during the term of this
Agreement, the parties hereto will consult with each other before issuing or
making any reports, statements or releases to the public with respect to this
Agreement or the transactions contemplated hereby and will use good faith
efforts to agree on the text of public reports, statements or releases.
9. Severance and Consulting Agreements. Holdco and the Stockholders agree
to enter into severance, consulting and non-competition agreements in the forms
attached hereto as Exhibits D-1 and D-2 on and as of the effective date of the
merger under the Merger Agreement.
10. General Provisions.
(a) Commercially Reasonable Efforts to Consummate the Transaction. Holdco
agrees that if the Merger Agreement, in the form attached hereto (the "Form
Merger Agreement"), is acceptable to the Special Committee of Independent
Directors of the Company's Board of Directors (the "Special Committee"), Holdco
will execute the Form Merger Agreement; provided, however, that Holdco will not
be required to execute the Form Merger Agreement if the Company discloses on the
Company Disclosure Schedule (as such term is defined in the Form Merger
Agreement) an event or circumstance of which Holdco has no knowledge as of the
date hereof that would cause the representations and warranties in the Form
Merger Agreement to fail to be true and correct without regard to the Company
Disclosure Schedule. If such an event or circumstance is disclosed on the
Company Disclosure Schedule or if the Special Committee requests changes to the
Form Merger Agreement, Holdco agrees to negotiate the Merger Agreement in good
faith and to use its commercially reasonable efforts to consummate the
Transaction on terms mutually acceptable to the Special Committee and Holdco.
Expenses. Whether or not the transactions contemplated hereby are
consummated, all costs and expenses incurred in connection with this Agreement
and the transactions contemplated hereby shall be paid by the party incurring
such expenses, except as otherwise specifically noted herein or in the Merger
Agreement.
Notices. All notices, requests, demands and other communications which are
required or may be given under this Agreement shall be in writing and shall be
deemed to have been duly given when received if personally delivered; when
transmitted if transmitted by telecopy, electronic or digital transmission
method; the day after it is sent, if sent for next day delivery to a domestic
address by recognized overnight delivery service (e.g., Federal Express); and
upon receipt, if sent by certified or registered mail, return receipt requested.
In each case notice shall be sent to:
(i) if to Holdco, to:
Acquisition Holdings, Inc.
c/x Xxxxx, Xxxx & Xxxxx
Xxx Xxx Xxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx X. Xxxxxxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
with copies to:
Xxxxxxxxxx & Xxxxx LLP
00 Xxxxxxxxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx X. Xxxxxxxx, Esq.
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
(ii) if to the Stockholders, to the respective addresses set forth on
Exhibit C.
Interpretation. When a reference is made in this Agreement to Sections,
such reference shall be to a Section of this Agreement unless otherwise
indicated. Headings contained in this Agreement are for reference purposes only
and shall not affect in any way the meaning or interpretation of this Agreement.
Whenever the word "include," "includes" or "including" are used in this
Agreement, they shall be deemed to be followed by the words "without
limitation". This Agreement shall not be construed for or against either party
by reason of the authorship or alleged authorship of any provision hereof or by
reason of the status of the respective parties. All terms defined in this
Agreement in the singular shall have comparable meanings when used in the
plural, and vice versa, unless otherwise specified.
Entire Agreement; No Third-Party Beneficiaries. This Agreement constitutes
the entire agreement and supersedes all prior agreements and understandings,
both written and oral, among the parties with respect to the subject matter
hereof and is not intended to confer upon any Person other than the parties
hereto any rights or remedies hereunder.
Assignment. Except in connection with Permitted Transfers, neither this
Agreement nor any of the rights, interests or obligations hereunder shall be
assigned (whether by operation of law or otherwise) by any Stockholder without
the consent of Holdco. Subject to the preceding sentence, this Agreement will be
binding upon, inure to the benefit of and be enforceable by the parties and
their respective successors and assigns.
Governing Law. This Agreement shall be construed, interpreted and the
rights of the parties determined in accordance with the laws of the State of New
York (without reference to the choice of law provisions), except with respect to
matters of law concerning the internal corporate affairs of any corporate entity
which is a party to or the subject of this Agreement, and as to those matters
the law of the jurisdiction under which the respective entity derives its powers
shall govern.
Severability. Each party agrees that, should any court or other competent
authority hold any provision of this Agreement or part hereof to be null, void
or unenforceable, or order any party to take any action inconsistent herewith or
not to take an action consistent herewith or required hereby, the validity,
legality and enforceability of the remaining provisions and obligations
contained or set forth herein shall not in any way be affected or impaired
thereby. Upon any such holding that any provision of this Agreement is null,
void or unenforceable, the parties will negotiate in good faith to modify this
Agreement so as to effect the original intent of the parties as closely as
possible in an acceptable manner to the end that the transactions contemplated
by this Agreement are consummated to the extent possible. Except as otherwise
contemplated by this Agreement, to the extent that a party hereto took an action
inconsistent herewith or failed to take action consistent herewith or required
hereby pursuant to an order or judgment of a court or other competent authority,
such party shall incur no liability or obligation unless such party did not in
good faith seek to resist or object to the imposition or entering of such order
or judgment.
Injunctive Relief. Subject to the last paragraph of Section 3(e), the
parties acknowledge that it will be impossible to measure in money the damages
that would be suffered if the parties fail to comply with any of the obligations
herein imposed on them and that in the event of any such failure, an aggrieved
Person or entity will be irreparably damaged and will not have an adequate
remedy at law. Subject to the last paragraph of Section 3(e), any such Person or
entity shall, therefore, be entitled to injunctive relief, including specific
performance, to enforce such obligations, and if any action should be brought in
equity to enforce any of the provisions of this Agreement, none of the parties
shall raise the defense that there is an adequate remedy at law.
Attorneys' Fees. If any party to this Agreement brings an action to enforce
its rights under this Agreement, the prevailing party shall be entitled to
recover its costs and expenses, including without limitation reasonable
attorneys' fees, incurred in connection with such action, including any appeal
of such action.
Cumulative Remedies. Subject to the last paragraph of Section 3(e), all
rights and remedies of either party hereto are cumulative of each other and of
every other right or remedy such party may otherwise have at law or in equity,
and the exercise of one or more rights or remedies shall not prejudice or impair
the concurrent or subsequent exercise of other rights or remedies.
Counterparts. This Agreement may be executed in two or more counterparts,
all of which shall be considered one and the same instrument and shall become
effective when executed and delivered by each of the parties.
(m) Amendments, Waivers, Etc. This Agreement may not be amended, changed,
supplemented, waived or otherwise modified or terminated, except upon the
execution and delivery of a written agreement executed by the parties hereto.
(n) Binding Agreement. Each Stockholder agrees that this Agreement and the
obligations hereunder shall attach to the Shares and shall be binding upon any
Person or entity to which legal or Beneficial Ownership of such shares shall
pass, whether by operation of law or otherwise, including, without limitation,
such Stockholder's heirs, distributees, guardians, administrators, executors,
legal representatives, or successors or other transferees (for value or
otherwise) and any other successors in interest. Notwithstanding any transfer of
Shares the transferor shall remain liable for the performance of all obligations
under this Agreement of the transferor.
(o) Capacity. For purposes of this Agreement and the representations,
covenants and promises contained herein, each of the Stockholders is acting
solely in his capacity as a stockholder of, and not as a director, officer,
employee, representative or agent of, the Company.
(p) Obligations of the Stockholders. The liabilities and obligations of
each Stockholder under any provision of this Agreement are several and not joint
and apply solely to such Stockholder and to the Shares held of record or
Beneficially Owned by such Stockholder. No Stockholder shall have any liability
or obligation under this Agreement for any act, omission or breach by any other
Stockholder.
(q) Consent and Jurisdiction. Each party irrevocably and unconditionally
agrees and consents that any suit, action or other legal proceeding arising out
of or related to this Agreement shall be brought and heard in New York County,
State of New York and each party irrevocably consents to personal jurisdiction
in any and all tribunals in said County.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first written above.
Acquisition Holdings, Inc.
By:
----------------------------------------
Name: Xxxxxx X. Xxxxxxxxxx
President
----------------------------------------
Xxxxx X. Xxxxx
----------------------------------------
Xxxxxx Xxxxx
Exhibit C
Stockholder Existing Shares (#) Proxy Shares (#)
Xxxxxx Xxxxx 1,022,042 720,035
c/o ATC Group Services Inc.
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Tel: (000) 000-0000
Fax: (000) 000-0000
with a copy to:
Cadwalader, Xxxxxxxxxx & Xxxx
000 Xxxxxx Xxxx
Xxx Xxxx, Xxx Xxxx 00000
Tel: (000) 000-0000
Fax: (000) 000-0000
Attn: Xxxxxxxx X. Xxxxxx, Esq.
Xxxxx X. Xxxxx 638,739 449,995
c/o ATC Group Services Inc.
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Tel: (000) 000-0000
Fax: (000) 000-0000
with a copy to:
Cadwalader, Xxxxxxxxxx & Xxxx
000 Xxxxxx Xxxx
Xxx Xxxx, Xxx Xxxx 00000
Tel: (000) 000-0000
Fax: (000) 000-0000
Attn: Xxxxxxxx X. Xxxxxx, Esq.
Total 1,660,781 1,170,030
Total Outstanding* 7,805,407
--------------------------
* As of August 18, 1997.
