Exhibit 10.8
ANCILLARY AGREEMENT
TO
PROXY AGREEMENTS
WITH RESPECT TO CAPITAL STOCK
OF
MICROPAC INDUSTRIES, INC.
THIS ANCILLARY AGREEMENT, is entered into to be effective as of the
19th day of February, 1987, by and among MICROPAC INDUSTRIES, INC. a Delaware
corporation ("Micropac"), X. Xxxx Xxxxx, Xxxxxxx Xxxxxx Xxxx, Xxxxxxx X.
Xxxxxxxx and their successors appointed as in this Agreement provided
(hereinafter collectively referred to as the "Proxy Holders"), and Heinz-Xxxxxx
Xxxxxx and Xxxxxxxxx-Xxxxxxx Xxxxxx, citizens of the Federal Republic of Germany
(hereinafter called the "Hempels").
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, Micropac, certain Voting Trustees and the Hempels entered into
a Voting Trust Agreement With Respect to Capital Stock of Micropac Industries,
Inc. dated as of the 18th day of January, 1977, amended the 28th day of August,
1980, and further amended the 7th day of September, 1982 (the "Voting Trust
Agreement"); and
WHEREAS, the Voting Trust Agreement expired on the 19th day of January,
1987; and
WHEREAS, Micropac desires, in order to maintain its facility security
clearance issued under the United States Department of Defense Industrial
Security Regulation (the "Regulation"), that each of the Hempels separately
enter into a Proxy Agreement With Respect to Capital Stock of Micropac
Industries, Inc. with Micropac and the Proxy Holders dated and effective as of
this 19th day of February, 1987 (the "Proxy Agreements"); and
WHEREAS, Micropac and the Proxy Holders have agreed as an inducement
for the Hempels' execution and delivery of the Proxy Agreements to make
additional covenants for the benefit of the Hempels in connection with the
execution and delivery of the Proxy Agreements.
NOW, THEREFORE, in consideration of the premises and mutual covenants
herein contained, and such other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the parties hereby agree as
follows:
1. Proxy Agreements Subject to this Ancillary Agreement. This Ancillary
Agreement is an inducement to the execution and delivery of the Proxy
Agreements. As such, both Proxy Agreements are subject to, and will only become
effective and binding on the parties thereto and hereto, upon the execution,
delivery and effectiveness of this Ancillary Agreement.
2. Registration of Micropac Stock of the Hempels by Micropac.
a. The Hempels' Right to Require Registration. At any time after the
effective date of this Ancillary Agreement, the Hempels shall be
entitled by notice to Micropac to require Micropac to file a
registration statement with the Securities and Exchange Commission (the
"Commission") with respect to and to expend best efforts to effect
registration of any number of shares or other units of Micropac Stock
owned by the Hempels in the manner of disposition set forth in such
notice. No such notice shall be effective and Micropac shall not be
required so to file a registration statement unless each of the
following conditions is met:
(i) Micropac shall not have effected any registration under
the Securities Act of 1933, as amended, (the "Securities Act")
as the result of any prior notice by the Hempels pursuant to
this subparagraph (a) of this Paragraph 2, it being intended
that the Hempels may only require one registration of its
Micropac Stock pursuant to this subparagraph (a);
(ii) The minimum number of shares or other units of Micropac
Stock specified in or covered by the notice shall be 400,000
shares of Micropac Stock; and
(iii) There shall not have been a registration statement
covering Micropac Stock in effect and available to the Hempels
and covering its shares of Micropac Stock, during the ninety
(90) days preceding the date of the Hempels' notice hereunder.
b. The Hempels' Right to Participation in Registration. If at any time
following the effective date of this Ancillary Agreement, while the
Hempels shall own any Micropac Stock, Micropac proposes at any time and
from time to time to register any Micropac Stock under the Securities
Act, Micropac shall, at each such time, give notice of such proposal to
the Hempels. The Hempels may, by notice to Micropac, require the
inclusion of all or any portion of the Micropac Stock they then own, up
to 30% of the total of all shares to be registered, in the registration
statement which Micropac has proposed to file, but no such notice shall
be effective unless given no later than thirty (30) days after the date
upon which notice of a proposed registration is given by Micropac and
any such notice shall include the number of shares or units which the
Hempels desire to have included. Micropac shall proceed, pursuant to
the provisions of this Paragraph 2 to effect the registration of any
Micropac Stock specified in an effective notice. Notwithstanding the
foregoing, Micropac may abandon any registration, provided such
abandonment occurs with respect to all securities being registered by
Micropac and further provided that such abandonment shall be without
prejudice to any right of the Hempels to require registration of the
shares of Micropac Stock they own pursuant to subparagraph (a) above.
c. Registration by Micropac; Cost and Expenses. If Micropac is
required, as the result of notice by the Hempels pursuant to
subparagraph (a) or (b) of this Paragraph 2, to effect the registration
of any Micropac Stock, Micropac shall expeditiously:
(i) Prepare and file with the Commission a
registration statement on appropriate form with
respect to the Micropac Stock specified in the
applicable notice and, subject to necessary
Commission approval, to expend best efforts to cause
such registration statement to become and remain
effective for disposition of the Micropac Stock in
accordance with the intended method of disposition
described in the Hempels' notice.
(ii) Furnish to the Hempels such number of copies of
a summary prospectus or other prospectus, including a
preliminary prospectus, in conformity with the
requirements of the Securities Act and such other
documents as the Hempels may reasonably request in
order to facilitate their disposition of Micropac
Stock owned by them and covered by such registration
statement; and
(iii) Subject to necessary governmental approvals,
register or qualify the Micropac Stock owned by the
Hempels and covered by such registration statement
under such other securities or blue sky laws of such
jurisdictions within the United States as the Hempels
may reasonably request, to enable the Hempels to
consummate the disposition in such jurisdictions of
the Micropac Stock owned by the Hempels and covered
by such registration statement.
The rights created by subparagraphs (a) and (b) of this Paragraph 2
shall be cumulative, not exclusive. With respect to any registration of
Micropac Stock under subparagraph (a) of this Paragraph 2, the Hempels
shall pay underwriting discounts and commissions, registration and
filing fees, fees of any special legal counsel to the Hempels and
expenses of special audits incident to or required by any such
registration, provided however, Micropac shall pay and shall hold the
Hempels harmless against (i) any such accounting costs if such demand
for registration is coordinated with the regular preparation of
financial reports by Micropac and (ii) any costs of counsel or other
experts for Micropac; and further provided, that in the event Micropac
or any other holder of Micropac Stock includes any additional Micropac
securities in the registration statement which the Hempels have
required to be filed, then any such expenses to be borne by the Hempels
shall be proportionately allocated among all participants in said
registration. With respect to any registration of Micropac Stock under
subparagraph (b) of this Paragraph 2, Micropac shall pay all expenses
of such registration including expenses incurred by the Hempels other
than fees and disbursements of any special legal counsel for the
Hempels and excluding any underwriter's commissions on the Micropac
Stock sold by the Hempels. It shall be a condition precedent to the
obligation of Micropac to take any action pursuant to this Paragraph 2
that the Hempels shall furnish to Micropac such information regarding
Micropac Stock held by the Hempels and the intended method of
disposition thereof, and other relevant information, as Micropac shall
reasonably request and as shall be required in connection with the
actions to be taken by Micropac.
d. The rights granted in this Paragraph 2 shall expire and be of no
further force and effect on the earlier to occur of (i) the tenth
(10th) anniversary hereof, (ii) the date on which the Micropac Stock is
listed on the New York Stock Exchange or (iii) the date on which the
public float of the Micropac Stock is at least 250,000 shares.
3. Cooperation in Private Placements.
If at any time the Hempels shall desire to offer for sale or sell any Micropac
Stock in a transaction which is either exempt from the registration provision of
the Securities Act or not subject to the jurisdiction thereof, Micropac shall,
as promptly as practicable after notice to such effect from the Hempels, furnish
in writing such information concerning Micropac and its affairs as the Hempels
may request for inclusion in any placement memorandum or other offering document
including information of the character described and referred to in the
Commission's Regulation D or other rules regarding unregistered sales of
securities as may be applicable under the Securities Act and a reasonable number
of copies of the documents referenced therein. Micropac shall promptly notify
the Hempels of any material developments not disclosed in the information
furnished or of the occurrence of any event as a result of which the information
furnished contains an untrue statement of a material fact or omits to state a
material fact required to be stated therein under such rules necessary to make
the statements therein not misleading under the then-existing circumstances.
Micropac will also provide access to its books and records and afford the
Hempels, the offeree(s) and their representatives, the opportunity to consult
with the executive officers of Micropac in order to obtain information necessary
to verify facts and statements; and Micropac will otherwise cooperate fully with
the Hempels in placing such Micropac Stock, including executing and delivering
such reasonable certificates and assurances as customarily are required in
institutional private placements. The foregoing shall not be construed to
require the Board of Directors or management of Micropac to violate their
fiduciary duty under the Delaware General Corporation Law ("GCL").
4. Indemnification.
Micropac shall, upon the written request of the Hempels, indemnify the Hempels
and each other person, if any, who controls the Hempels within the meaning of
the Securities Act, and each underwriter who participated in the offering of
such securities, against any losses, claims, expenses (including the reasonable
costs of investigating and defending against any claim therefor and related
counsel fees and settlement costs), damages or liabilities, joint or several, to
which the Hempels or such controlling person or underwriter may become subject
under the Securities Act, the Securities Exchange Act of 1934, as amended, (the
"Exchange Act") or otherwise as the result of failure to comply with the
Securities Act or the Exchange Act by reason of any omission of any material
fact required to be stated or necessary to make statements made not misleading,
or by reason of the fact that such statements made contain any untrue statement
of a material fact, or by reason of any omission from any prospectus or offering
materials or filing furnished to such holder of any material fact necessary to
be stated therein in order to make statements therein in the light of the
circumstances under which they were made not misleading, or by reason of the
fact that such prospectus, offering materials or filing contained any untrue
statements of a material fact, unless such statement or omission was made in
reliance upon and in conformity with written information furnished to Micropac
by the Hempels. Micropac's indemnity obligation shall be limited accordingly in
the event and to the extent that the Hempels shall have been determined to have
been guilty of wrongdoing in connection with any transaction under Paragraphs 2
and 3. The Hempels, as a condition precedent of Micropac's obligations under
Paragraphs 2 and 3, hereby agree that they will, upon the written request of
Micropac, indemnify Micropac to the same extent as the foregoing indemnity from
Micropac to them but only with respect to information furnished in writing by
the Hempels for use in any registration statement or prospectus, offering
materials or filing.
5. Presentation of Proposals.
Micropac shall promptly forward to the Hempels any proposal for any type of
business combination transaction delivered to Micropac or any member of its
Board of Directors or management. The Hempels and their representatives and
financial advisors shall have the right to participate fully in all meetings
regarding and all negotiations regarding such proposals. Any financial advisor
or investment banker engaged by Micropac will be subject to approval by the
Hempels.
6. Pursuit of Proposals.
Micropac, its Board of Directors and management, consistent with their fiduciary
duties to Micropac stockholders (including the Hempels), shall cooperate fully
with the Hempels in the good faith pursuit of any proposals, or negotiations
regarding any proposals, for business combinations, such as described under
Paragraph 5, including the recommendation of any such proposals or negotiations
leading to a proposed business combination which would benefit all stockholders.
The foregoing shall not be construed to require the Board of Directors or
management of Micropac to violate their fiduciary duty under the GCL.
7. Cost of the Agreements.
All costs and expenses incurred by Micropac or the Hempels in the establishment,
execution and delivery, maintenance and administration of the Proxy Agreements
or this Ancillary Agreement shall be borne by Micropac.
Micropac shall, upon the written request of the Hempels, indemnify the Hempels
for any losses, claims or expenses which they may incur pursuant to this
Ancillary Agreement.
8. Most Favored Rights of the Hempels.
If at any time Micropac shall grant any registration rights more favorable to
the holder than the rights granted herein to the Hempels, the Hempels rights
should be automatically included with such rights subsequently granted therein.
9. Notices.
All notices to be given to the Hempels shall be given by mailing the same in a
sealed postpaid envelope, addressed to the address as shown on the books of the
Proxy Holders, and any notice whatsoever when mailed by or on behalf of the
Proxy Holder as herein provided shall have the same effect as though personally
served. All notices to be given to the Proxy Holders shall be given by serving a
copy thereof upon the Proxy Holders personally or by mailing the same in a
sealed postpaid envelope addressed to them at their office in the Town of
Garland, Texas with a copy to the last known residence address of each Proxy
Holder.
10. Entire Agreement.
This Ancillary Agreement, in conjunction with the Proxy Agreement, constitutes
the entire agreement among the parties hereto, and any other prior
understandings or agreements regarding the subject matter hereof are expressly
superseded by this Ancillary Agreement and the Proxy Agreement.
11. Binding Effect.
This Ancillary Agreement shall be binding upon and inure to the benefit of the
parties and their respective legal representatives, successors and assigns;
provided however that the rights of the Hempels and the obligations of Micropac
hereunder shall (i) as to the provision of Paragraph 2 be freely assignable in
any transaction not involving a public offering; (ii) as to the other provisions
hereof, shall be transferable by the Hempels only by devise or the laws of
intestate succession, or to each other.
12. Headings.
The Paragraph headings in this Ancillary Agreement are for convenience of
reference only, and shall not be deemed to alter or affect the meaning or
interpretation of any provisions hereof.
13. Construction.
This Ancillary Agreement shall be constued in accordance with and governed by
the laws of the State of Texas.
14. Counterparts.
This Ancillary Agreement may be executed in one or more counterparts each of
which shall be deemed to be an original and all of which together shall be
deemed to be one and the same instrument.
IN WITNESS WHEREOF, this Ancillary Agreement has been duly executed and
delivered to be effective as of the date first above written.
MICROPAC INDUSTRIES, INC.
By: /s/ N. Nodolsky
-----------------------------
Xxxxxxxx Xxxxxxxx
President and
Chairman of the Board
By: /s/ X X Xxxxx
------------------------- -----------------------------
Witness Proxy Holder
By: /s/ Xxxxxxx X Xxxx
------------------------- -----------------------------
Witness Proxy Holder
By: /s/ Xxxxxxx Xxxxxxxx
------------------------- -----------------------------
Witness Proxy Holder
By: /s/ Heinz-Xxxxxx Xxxxxx
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Heinz-Xxxxxx Xxxxxx
By: /s/ Xxxxxxxxx-Xxxxxxx Xxxxxx
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Xxxxxxxxx-Xxxxxxx Xxxxxx
