_____________________________________________________
_____________________________________________________
SHAREHOLDER AGREEMENT
by and among
INTERSTATE BAKERIES CORPORATION,
XXXXXXX PURINA COMPANY
and
VCS HOLDING COMPANY
Dated July 22, 1995
_____________________________________________________
_____________________________________________________
TABLE OF CONTENTS
Page
ARTICLE I DEFINITIONS 1
Section 1.1 Affiliate. 1
Section 1.2 Applicable Acceptance Period. 1
Section 1.3 Associate. 1
Section 1.4 Business Day. 1
Section 1.5 CBC. 2
Section 1.6 Closing. 2
Section 1.7 Control. 2
Section 1.8 Demand Notice. 2
Section 1.9 Demand Registration. 2
Section 1.10 Exchange Act. 2
Section 1.11 First Offer. 2
Section 1.12 First Registration Rights Agreement. 2
Section 1.13 Group. 2
Section 1.14 IBC. 2
Section 1.15 IBC Call. 2
Section 1.16 IBC Equity. 2
Section 1.17 IBC Indemnified Party. 2
Section 1.18 IBC Market Price. 2
Section 1.19 IBC Stock. 3
Section 1.20 IBC Securities. 3
Section 1.21 Incidental Notice. 3
Section 1.22 Loss. 3
Section 1.23 Marketable Number. 3
Section 1.24 Notice of Exercise. 3
Section 1.25 Notice of Intention. 3
Section 1.26 Offered Shares. 3
Section 1.27 Person. 3
Section 1.28 Purchase Agreement. 4
Section 1.29 RAL Stock. 4
Section 1.30 Xxxxxxx. 4
Section 1.31 Xxxxxxx Indemnified Party. 4
Section 1.32 Registration Statement. 4
Section 1.33 RPC. 4
Section 1.34 SEC. 4
Section 1.35 Securities Act. 4
Section 1.36 Securities Exchange Act. 4
Section 1.37 Transfer. 4
Section 1.38 VCS. 4
ARTICLE II STANDSTILL AND VOTING PROVISIONS 4
Section 2.1 Standstill Covenants. 4
Section 2.2 Issuance of IBC Securities. 6
Section 2.3 Voting of IBC Equity. 6
ARTICLE III TRANSFERS OF IBC EQUITY 6
Section 3.1 Restrictions on Transfer. 6
Section 3.2 Exceptions to Restrictions. 6
Section 3.3 Other Transfers. 7
Section 3.4 Improper Transfer. 7
Section 3.5 Restrictive Legend. 7
ARTICLE IV RIGHT OF FIRST OFFER 9
Section 4.1 Sales by Xxxxxxx. 9
Section 4.2 Purchase of the Offered Shares. 9
Section 4.3 Waiting Period with Respect to Subsequent
Transfers. 9
ARTICLE V REGISTRATION 10
Section 5.1 Demand registration. 10
Section 5.2 Delay of Demand Registration. 11
Section 5.3 Incidental Registration. 12
Section 5.4 Delay of Incidental Registration. 13
Section 5.5 Third Party Registration Rights. 13
ARTICLE VI REGISTRATION EXPENSES 13
Section 6.1 Registration Expenses. 13
ARTICLE VII REGISTRATION PROCEDURE 14
Section 7.1 Xxxxxxx Information. 14
Section 7.2 Compliance. 14
Section 7.3 Provision of Prospectuses. 15
Section 7.4 Blue Sky Compliance. 15
Section 7.5 Maintenance of Effectiveness. 15
Section 7.6 Listing of IBC Equity. 15
Section 7.7 Stop-Orders. 16
ARTICLE VIII INDEMNIFICATION AND CONTRIBUTION 16
Section 8.1 Indemnification. 16
Section 8.2 Contribution. 18
ARTICLE IX CALL RIGHTS 19
Section 9.1 IBC Call. 19
ARTICLE X ADDITIONAL COVENANTS 20
Section 10.1 Maintain Listing or Quotation. 20
Section 10.2 Board of Directors. 20
Section 10.3 No Inconsistent Agreements. 20
Section 10.4 Preferred Stock. 20
Section 10.5 Rule 144 and 144A. 20
Section 10.6 Maximum Allowed Ownership of IBC Securities. 21
ARTICLE XI MISCELLANEOUS 21
Section 11.1 Entire Agreement. 21
Section 11.2 Headings and Captions. 21
Section 11.3 Choice of Law. 21
Section 11.4 Venue. 21
Section 11.5 Notices. 21
Section 11.6 Amendments. 22
Section 11.7 Extended Meanings. 22
Section 11.8 Assignments. 22
Section 11.9 Severability. 22
Section 11.10 Counterparts. 23
Section 11.11 Remedies Cumulative. 23
Section 11.12 Binding Agreement. 23
Section 11.13 Recapitalizations, Exchanges, Etc.,
Affecting IBC Securities. 23
Section 11.14 Other Agreements. 23
Section 11.15 Term., Effectiveness. 23
Section 11.16 Enforcement. 23
Section 11.17 Confidentiality. 24
Section 11.18 Fiduciary Accounts. 24
SHAREHOLDER AGREEMENT
---------------------
THIS SHAREHOLDER AGREEMENT dated July 22, 1995 (the "Agreement"), is
made by and among INTERSTATE BAKERIES CORPORATION, a Delaware corporation
("IBC"), XXXXXXX PURINA COMPANY, a Missouri corporation ("RPC") and VCS
HOLDING COMPANY, a Delaware corporation and a wholly-owned subsidiary of RPC
("VCS") (RPC, VCS and any of their Affiliates (as defined below) which own
IBC Equity (as defined below) are collectively referred to as "Xxxxxxx").
WHEREAS, pursuant to that certain Sale and Purchase Agreement dated as
of April 12, 1995 (the "Purchase Agreement") by and among IBC, RPC, VCS and
CONTINENTAL BAKING COMPANY, a Delaware corporation and wholly-owned
subsidiary of VCS ("CBC"), IBC acquired all of the outstanding shares of
capital stock of CBC, par value $100 per share, from VCS in exchange for cash
in the amount of $220,000,000 and 16,923,077 shares of IBC Stock (as defined
below); and
WHEREAS, the parties hereto desire to enter into this Agreement to
provide for certain rights and restrictions with respect to the shares of IBC
Equity.
NOW, THEREFORE, in consideration of the mutual covenants and
obligations set forth herein, each of IBC and Xxxxxxx agree as follows:
ARTICLE I
DEFINITIONS
-----------
As used in this Agreement, and unless the context requires a different
meaning, the following terms (whether used in the singular or plural) have
the meanings indicated. Any term used and not defined herein has the meaning
set forth in the Purchase Agreement.
Section 1.1 Affiliate. An "Affiliate" of a Person, means any
other Person that directly or indirectly through one or more intermediaries
Controls, is controlled by or is under common control with such Person. When
used in this Agreement with respect to IBC, the term applies only to other
Persons that are Affiliates, as so defined, as of the date of this Agreement.
Section 1.2 Applicable Acceptance Period. "Applicable
Acceptance Period" has the meaning set forth in Section 4.1(c) of this
Agreement.
Section 1.3 Associate. An "Associate" of a Person, means any
of such Person's directors, officers, shareholders, representatives,
trustees, employees, attorneys, advisors, or agents.
Section 1.4 Business Day. "Business Day" means any day other
than a Saturday, Sunday or legal holiday for commercial banks in Kansas City,
Missouri.
Section 1.5 CBC. "CBC" has the meaning set forth above in the
recitals to this Agreement.
Section 1.6 Closing. "Closing" means the closing of the
transactions contemplated by the Purchase Agreement.
Section 1.7 Control. "Control" (including the terms
"controlling," "controlled by" and "under common control with") means the
possession of the power, directly or indirectly, (a) to elect a majority of
the board of directors (or equivalent governing body) of the entity in
question; or (b) to direct or cause the direction of the management and
policies of or with respect to the entity or assets in question, whether
through ownership of securities, by contract or otherwise.
Section 1.8 Demand Notice. "Demand Notice" has the meaning set
forth in Section 5.1 of this Agreement.
Section 1.9 Demand Registration. "Demand Registration" has the
meaning set forth in Section 5.1 of this Agreement.
Section 1.10 Exchange Act. "Exchange Act" means the Securities
Exchange Act of 1934, as amended, and the rules and regulations thereunder.
Section 1.11 First Offer. "First Offer" has the meaning set
forth in Section 4.1(a) of this Agreement.
Section 1.12 First Registration Rights Agreement. "First
Registration Rights Agreement" has the meaning set forth in Section 5.5 of
this Agreement.
Section 1.13 Group. "Group" means any group of Persons within
the meaning of Section 13(d)(3) of the Exchange Act.
Section 1.14 IBC. "IBC" has the meaning set forth above in the
recitals to this Agreement.
Section 1.15 IBC Call. "IBC Call" means the right of IBC to
acquire certain IBC Equity pursuant to Section 9.1(a) of this Agreement.
Section 1.16 IBC Equity. "IBC Equity" means shares of IBC Stock
acquired by Xxxxxxx at the Closing and any other IBC Securities owned,
beneficially or of record, by Xxxxxxx at any time during the term of this
Agreement.
Section 1.17 IBC Indemnified Party. "IBC Indemnified Party" has
the meaning set forth in Section 8.1(a) of this Agreement.
Section 1.18 IBC Market Price. "IBC Market Price" means the
average of the closing sale prices of the class of IBC Securities being
valued on the New York Stock Exchange or if such IBC Securities are not
listed or admitted to trading on the New York Stock Exchange, as reported in
the principal consolidated transaction reporting system of the principal
national securities exchange on which the security is listed or admitted to
trading, for the twenty (20) trading days which end on the day immediately
prior to the date of the (i) Notice of Exercise delivered pursuant to an IBC
Call; (ii) Notice of Intention; (iii) Demand Notice; or (iv) Incidental
Notice, as the case may be. If the IBC Securities are not listed or admitted
to trading on any national securities exchange, the IBC Market Price means
the last quoted sale price or, if not so quoted, the average of the high bid
and low asked prices in the over-the-counter market, as reported by the
National Association of Securities Dealers, Inc. Automated Quotations System
or such other system then in use, for the twenty (20) trading days which end
on the day immediately prior to such date, or, if on any such trading day
such IBC Securities are not quoted by any such organization, the average of
the closing bid and asked prices as furnished by two professional market
makers making a market in such securities, one selected in good faith by the
board of directors of IBC and the other selected in good faith by Xxxxxxx.
If the IBC Securities are not publicly held or so listed or publicly traded,
IBC Market Price means the cash price at which a willing seller would sell
and a willing buyer would buy such securities in an arm's-length negotiated
transaction without undue time restraints, as determined in good faith by, an
investment banking firm selected by agreement between IBC and Xxxxxxx
Section 1.19 IBC Stock. "IBC Stock" means the $.01 par value
common stock of IBC.
Section 1.20 IBC Securities. "IBC Securities" means any voting
securities of IBC or its affiliates, including any securities convertible
into or exercisable or exchangeable for any voting securities of IBC.
Section 1.21 Incidental Notice. "Incidental Notice" has the
meaning set forth in Section 5.3(a) of this Agreement.
Section 1.22 Loss. "Loss" has the meaning set forth in
Section 8.1(a)(i) of this Agreement.
Section 1.23 Marketable Number. "Marketable Number" has the
meaning set forth in Section 5.3(b) of this Agreement.
Section 1.24 Notice of Exercise. "Notice of Exercise" has the
meaning set forth in Section 4.1(c) of this Agreement.
Section 1.25 Notice of Intention. "Notice of Intention" has the
meaning set forth in Section 4.1(b) of this Agreement.
Section 1.26 Offered Shares. "Offered Shares" has the meaning
set forth in Section 4.1(b) of this Agreement.
Section 1.27 Person. "Person" means an individual, corporation,
partnership, trust, incorporated or unincorporated association, joint
venture, joint stock company, limited liability company, government (or an
agency or political subdivision thereof) or other entity of any kind.
Section 1.28 Purchase Agreement. "Purchase Agreement" has the
meaning set forth above in the recitals to this Agreement.
Section 1.29 RAL Stock. "RAL Stock" means RPC's Xxxxxxx-Xxxxxxx
Purina Group Common Stock, $.10 par value per share, or any such other class
of common stock of RPC at any time outstanding.
Section 1.30 Xxxxxxx. "Xxxxxxx" has the meaning set forth above
in the recitals to this Agreement.
Section 1.31 Xxxxxxx Indemnified Party. "Xxxxxxx Indemnified
Party" has the meaning set forth in Section 8.1(b) of this Agreement.
Section 1.32 Registration Statement. "Registration Statement'
means any registration statement or comparable document under Section 5 of
the Securities Act through which a public sale or disposition of IBC
Securities may be registered other than a registration statement (a) relating
to an Employee Benefit Plan or similar plan, or a business combination; or
(b) on any form that is not available for a secondary offering.
Section 1.33 RPC. "RPC" has the meaning set forth above in the
recitals to this Agreement.
Section 1.34 SEC. "SEC" means the Securities and Exchange
Commission or other federal agency at the time administering the Securities
Act, the Exchange Act or any successor acts thereto.
Section 1.35 Securities Act. "Securities Act" means the
Securities Act of 1933, as amended, and the rules and regulations thereunder.
Section 1.36 Securities Exchange Act. "Securities Exchange Act"
means the Securities Exchange Act of 1934, as amended, and the rules and
regulations thereunder.
Section 1.37 Transfer. "Transfer" with respect to all or any
part of the IBC Equity means to directly or indirectly (whether or not
through an underwriter) offer, sell, convey, distribute, transfer (by merger
or otherwise), assign, devise, exchange, encumber, gift, pledge, hypothecate
or otherwise dispose of such IBC Equity.
Section 1.38 VCS. "VCS" has the meaning set forth above in the
recitals to this Agreement.
ARTICLE II
STANDSTILL AND VOTING PROVISIONS
--------------------------------
Section 2.1 Standstill Covenants. Unless specifically requested
or permitted in writing in advance by the Chairman of the Board of IBC or
unless otherwise permitted in this Agreement, Xxxxxxx agrees that until the
sixth anniversary date of this Agreement, it will not, directly or
indirectly:
(a) acquire, offer to acquire, or agree to acquire by
purchase or otherwise, any IBC Securities except as a result of a stock
split, stock dividend or similar recapitalization by IBC;
(b) except in the ordinary course of business, acquire,
offer to acquire, or agree to acquire by purchase or otherwise, any
assets of IBC;
(c) initiate, solicit, propose, seek to effect or
negotiate, alone or with any other Person, (i) any form of business
combination transaction involving IBC or any Affiliate thereof, or
(ii) any restructuring, recapitalization or similar transaction with
respect to IBC or any Affiliate thereof;
(d) initiate, solicit, propose, seek to effect,
negotiate, or announce an intent to make, alone or with any other
Person, any tender offer, exchange offer, merger, consolidation or
share exchange for any IBC Securities, or disclose an intent, purpose,
plan or proposal with respect to IBC, any of its Affiliates or any IBC
Securities inconsistent with the provisions of this Agreement;
(e) make, or in any way participate in, any
"solicitation" of "proxies" (as such terms are defined or used in
Regulation 14A under the Exchange Act) with respect to IBC or any of
its Affiliates or become a "participant" in any "election contest"
(as such terms are defined or used in Rule 14a-11 under the Exchange
Act) involving IBC or any of its Affiliates;
(f) initiate, solicit, or propose the approval of one or
more shareholder proposals with respect to IBC or any of its Affiliates
or induce or attempt to induce any other Person to initiate any such
shareholder proposal;
(g) form, join or in any way participate in a Group with
respect to the IBC Securities;
(h) except as expressly provided herein, seek election to
or seek to place a representative on the board of directors of IBC or
any of its affiliates or seek the removal of any member of the board of
directors of IBC or any of its Affiliates;
(i) except for participation on the board of directors of
IBC, act in concert with any other Person to seek to affect the
management or board of directors of IBC or any of its Affiliates or
the business, operations or affairs of IBC or any of its Affiliates;
(j) call or seek to have called any meeting of the
shareholders of IBC or any of its Affiliates;
(k) disclose to any third party or in any filing with any
governmental authority any intention, plan or arrangement inconsistent
with any of the foregoing or with the restrictions on transfer set
forth in this Agreement; or
(l) enter into any discussions, negotiations,
arrangements or understandings with any third party with respect to any
of the foregoing, or advise, assist, encourage or influence any other
Person to take any action with respect to any of the foregoing.
Section 2.2 Issuance of IBC Securities. Notwithstanding anything
in Section 2.1 herein, during the term of this Agreement, if IBC issues any
IBC Securities in a public offering (other than a public offering of
Xxxxxxx'x IBC Equity) or as consideration in an acquisition, Xxxxxxx may
purchase in one or more open market transactions or otherwise that number of
shares necessary to bring its percentage of ownership in IBC to the same
level as immediately prior to such offering or acquisition; provided,
however, that Xxxxxxx must still comply with the provisions of Section 10.6.
Section 2.3 Voting of IBC Equity. Xxxxxxx agrees that during the
term of this Agreement, with respect to the election of directors of IBC,
each class of IBC Equity owned by Xxxxxxx shall be voted (i) "for" the
nominees recommended by the Board of Directors of IBC, provided IBC is in
compliance with the terms of Section 10.2 of this Agreement, (ii) in accordance
with the recommendation of the Board of Directors of IBC on each proposal of
a security holder pursuant to Rule 14a-8 under the Securities Exchange Act,
so long as the subject matter of such proposal does not fall within the
proviso hereto, and, (iii) with respect to all other matters requiring a vote
of the IBC Equity, "for" any proposal in the same proportion as the votes
cast "for" such proposal by the holders of the IBC Securities of the same
class (excluding the IBC Equity owned by Xxxxxxx), and "against" any
proposal in the same proportion as the votes cast "against" such proposal by
the holders of each such class of IBC Securities (excluding the IBC Equity
owned by Xxxxxxx) and that with respect to broker non-votes and abstentions,
each class of IBC Equity owned by Xxxxxxx will be voted in the same
proportion as votes deemed "for," "against" or "abstain," giving the
effect to broker non-votes and abstentions as required under the laws and
rules then applicable; provided, however, that Xxxxxxx shall retain the right
to vote its IBC Equity in any manner it sees fit with respect to any
proposals for (1) the merger of IBC or any subsidiary of IBC with or into any
other corporation, (2) the sale, lease, exchange, transfer or other
disposition of all or substantially all of the assets of IBC and all of its
subsidiaries taken together as a single business, or (3) the creation of any
other class of stock with voting rights. The provisions of this Section 2.3
shall apply to both the casting of votes at meetings of shareholders and
execution of actions by written consent.
ARTICLE III
TRANSFERS OF IBC EQUITY
-----------------------
Section 3.1 Restrictions on Transfer. During the term of this
Agreement, Xxxxxxx agrees that it will not, and it will cause each of its
Affiliates who acquire IBC Equity pursuant to Sections 3.2(c) or 3.3(c) of
this Agreement not to, Transfer any IBC Equity, except as permitted by or in
accordance with this Agreement.
Section 3.2 Exceptions to Restrictions. Subject to all
applicable laws, the restrictions on Transfer set forth in Section 3.1 hereof
shall not apply to any of the following:
(a) a Transfer of some or all of the IBC Equity pro rata
to all of the holders of the RAL Stock as a dividend or distribution or
similar transaction;
(b) a Transfer of some or all of the IBC Equity to an
Affiliate of Xxxxxxx, provided that such Affiliate shall agree to the
provisions of this Agreement and Xxxxxxx will remain liable for the
performance by such Affiliate of its obligations under this Agreement;
(c) a Transfer of some or all of the IBC Equity in
accordance with Section 5.3 of this Agreement;
(d) a Transfer of some or all of the IBC Equity in any
tender offer, self-tender, exchange offer, going private transaction or
other transaction involving a Transfer which is recommended to
shareholders of IBC by the board of directors of IBC;
(e) a Transfer of some or all of the IBC Equity in
accordance with Section 5.1 of this Agreement; and
(f) a Transfer of some or all of the IBC Equity allowed
under Rule 144 of the Securities Act.
Section 3.3 Other Transfers. In the event Xxxxxxx desires to
Transfer the IBC Equity in a manner not specifically permitted under Sections
3.2 of this Agreement, Xxxxxxx may submit a written Notice of Intention (as
defined in Section 4.1 hereof) to IBC. In the event IBC declines to purchase
the IBC Equity described in the Notice of Intention, and if, in the sole and
absolute discretion of IBC, the Chairman of the Board of IBC notifies Xxxxxxx
in writing that such Transfer may occur, the Transfer may proceed strictly in
accordance with Xxxxxxx'x Notice of Intention and with any terms and
conditions imposed by IBC on such Transfer and the transferee.
Section 3.4 Improper Transfer. Any attempt to Transfer any
shares of IBC Equity during the term of this Agreement not in accordance with
this Agreement will be null and void and IBC will not give nor permit the
transfer agent of IBC to give any effect to such attempted Transfer in its
stock records.
Section 3.5 Restrictive Legend.
(a) A copy of this Agreement will be filed with the
Secretary of IBC and kept with the records of IBC. All certificates
representing shares of IBC Equity hereafter issued to or acquired by
Xxxxxxx, if applicable, (or, if applicable, its successors in a
Transfer pursuant to Section 3.3) will bear the following legend noted
conspicuously on such certificates:
THE SHARES EVIDENCED BY THIS CERTIFICATE HAVE BEEN
ACQUIRED FOR DIVESTMENT ONLY, AND MAY NOT BE OFFERED,
SOLD, TRANSFERRED (BY MERGER OR OTHERWISE) ASSIGNED,
DEVISED, EXCHANGED, GIFTED, PLEDGED, HYPOTHECATED OR
OTHERWISE DISPOSED OF UNLESS AND UNTIL REGISTERED
UNDER THE SECURITIES ACT OF 1933,
AS AMENDED (THE "ACT") AND ANY APPLICABLE STATE
SECURITIES LAWS OR UNLESS SUCH TRANSFER IS EXEMPT FROM
REGISTRATION, AND AN ACCEPTABLE OPINION OF COUNSEL IS
DELIVERED TO IBC WITH REGARD TO SUCH EXEMPTION, OR IS
OTHERWISE IN COMPLIANCE WITH THE ACT AND SUCH STATE
SECURITIES LAWS.
THE SHARES EVIDENCED BY THIS CERTIFICATE ARE SUBJECT TO
THE RESTRICTIONS ON TRANSFER AS SET FORTH IN THE
SHAREHOLDER AGREEMENT, DATED JULY 22, 1995. NO TRANSFER
OF THESE SHARES WILL BE EFFECTIVE UNLESS AND UNTIL THE
TERMS AND CONDITIONS OF SUCH SHAREHOLDER AGREEMENT HAVE
BEEN COMPLIED WITH IN FULL AND NO PERSON MAY REQUEST
INTERSTATE BAKERIES CORPORATION TO RECORD THE TRANSFER
OF ANY SHARES IF SUCH TRANSFER IS IN VIOLATION OF SUCH
SHAREHOLDER AGREEMENT. A COPY OF THE SHAREHOLDER
AGREEMENT IS ON FILE AT THE EXECUTIVE OFFICES OF
INTERSTATE BAKERIES CORPORATION AND WILL BE FURNISHED
WITHOUT CHARGE TO THE HOLDER OF SUCH SHARES UPON WRITTEN
REQUEST. THE SHARES EVIDENCED BY THIS CERTIFICATE ARE
SUBJECT TO RESTRICTIONS ON VOTING PROVIDED FOR IN THE
SHAREHOLDER AGREEMENT AND NO VOTE OF SUCH SHARES THAT
CONTRAVENES THE SHAREHOLDER AGREEMENT SHALL BE
EFFECTIVE.
(b) Until such time as the IBC Equity has been registered
pursuant to a registration statement under the Securities Act or sold
pursuant to Rule 144 of the Securities Act, the certificates
representing IBC Equity (including, without limitation, all
certificates issued upon Transfer or in exchange thereof or
substitution therefor) will also bear any legend required under any other
applicable laws, including state securities or blue sky laws.
(c) IBC may make a notation on its records or give stop-
transfer instructions to any transfer agents or registrars for the IBC
Equity in order to implement the restrictions set forth in this
Article III hereof
(d) In the event Xxxxxxx acquires any other or additional
IBC Securities, Xxxxxxx will submit all certificates representing such
IBC Securities to IBC so that the legend or legends required by this
Section 3.5 may be placed thereon.
ARTICLE IV
RIGHT OF FIRST OFFER
--------------------
Section 4.1 Sales by Xxxxxxx.
(a) Except for Transfers permitted by Section 3.2(a), (b)
or (e), during the term of this Agreement, Xxxxxxx shall not sell any
shares of IBC Equity to any Person unless it has first made an offer
(the "First Offer") to sell such shares to IBC in accordance with this
Article IV and such First Offer shall have been rejected or not
accepted within the Applicable Acceptance Period (as hereinafter
defined).
(b) The First Offer to IBC shall be set forth in the form
of a notice made in writing (the "Notice of Intention") to IBC setting
forth (i) Xxxxxxx'x desire to make a sale; and (ii) the number of
shares of IBC Equity proposed to be sold (the "Offered Shares").
(c) Upon receipt of the Notice of Intention, IBC will
have the right to purchase the Offered Shares at the IBC Market Price,
exercisable by the delivery of an acceptance in the form of a notice in
writing to Xxxxxxx by IBC (the "Notice of Exercise") at any time
within twenty (20) calendar days from the date of receipt of the Notice
of Intention (the "Applicable Acceptance Period"). The right of IBC
to purchase IBC Equity will terminate if such Notice of Exercise is not
delivered within Applicable Acceptance Period. IBC may assign its
right to purchase the Offered Shares pursuant to a specific Notice of
Intention, once received by IBC, to any Person, but may not otherwise
assign its rights under this Article IV.
(d) In the event that IBC exercises its right to purchase
the Offered Shares in accordance with Section 4.1(c) hereof, then
Xxxxxxx must sell the Offered Shares to IBC at the IBC Market Price
within twenty (20) days from the date of receipt of the Notice of
Exercise delivered by IBC, subject to receipt of any required material
third-party or governmental approvals, compliance with applicable laws
and the absence of any injunction or similar legal order preventing
such transaction.
Section 4.2 Purchase of the Offered Shares. In the event IBC
rejects the First Offer or fails to deliver a Notice of Exercise within the
Applicable Acceptance Period, then Xxxxxxx may (a) proceed with the Transfer
pursuant to Articles V, VI, VII and VIII hereof, if applicable, or
(b) otherwise sell such Offered Shares to transferees who agree to be bound
by the terms and conditions of this Agreement, in the case of a rejection,
within ninety (90) days after the delivery of such rejection or, in the case
of a failure to deliver a Notice of Exercise, within ninety (90) days after
the expiration of the Applicable Acceptance Period, subject to the other
terms and conditions of this Agreement
Section 4.3 Waiting Period with Respect to Subsequent Transfers.
In the event that IBC' does not deliver a Notice of Exercise within the
Applicable Acceptance Period and Xxxxxxx does not sell the Offered Shares,
then Xxxxxxx may not offer to sell any additional IBC Equity (other than the
Offered Shares) for a period of ninety (90) days from the expiration of the
Applicable Acceptance Period.
ARTICLE V
REGISTRATION
------------
Section 5.1 Demand registration.
(a) During the term of this Agreement, upon Xxxxxxx'x
written request specifying the intended manner of disposition (a
"Demand Notice"), IBC will use its best efforts to prepare and file
with the SEC, as expeditiously as possible, a Registration Statement on
an available form for which IBC then qualifies and which legal counsel
for IBC deems appropriate and which form is available for the sale of
IBC Equity in accordance with the intended method of distribution
thereof to permit an offering of some or all of the shares of IBC
Equity then held by Xxxxxxx and use its best efforts to cause such
registration statement to become effective (a "Demand Registration");
provided, however, that with respect to proposed dispositions of IBC
Equity to shareholders of Xxxxxxx, Xxxxxxx and IBC will cooperate and
use their respective reasonable best efforts to obtain a "no-action
letter" from the SEC allowing such dispositions without registration.
(b) A Demand Registration will not be deemed to have
occurred until it has become effective under the Securities Act (unless
Xxxxxxx delivers a Demand Notice and subsequently withdraws the Demand
Notice, in which case such a Demand Registration will be deemed to have
occurred unless Xxxxxxx agrees to pay all reasonable out-of-pocket
expenses associated with such registration actually incurred by IBC);
provided, however, that if, after a Demand Registration has become
effective, the offering of IBC Equity pursuant to such Demand
Registration is prohibited by any stop-order, injunction or other order
or requirement of the SEC or other governmental agency or court, such
Demand Registration will be deemed not to have occurred (unless such
prohibition on the sale of the IBC Equity is based on actions or
omissions of Xxxxxxx, in which case such a Demand Registration will be
deemed to have occurred unless Xxxxxxx agrees to pay all reasonable
out-of-pocket expenses associated with such registration actually
incurred by IBC).
(c) IBC will only be obligated to effect a total of five
(5) Demand Registrations under Section 5.1 hereof and shall not be
obligated under Section 5.1 hereof to effect more than one (1) Demand
Registration in any twelve-month period (except that during each of the
twelve-month periods commencing on the date hereof and on the fourth
anniversary of this Agreement, Xxxxxxx shall be entitled to request up
to two (2) Demand Registrations); provided, however, that IBC will not
be required to register, the IBC Equity pursuant to a Demand Notice
under Section 5.1 hereof if at such time (i) the shares of IBC Equity
which Xxxxxxx is requesting to be registered pursuant to Section 5.1
hereof constitute less than five percent (5%) of such class or series
of the outstanding IBC Securities so requested to be registered or
(ii) such Demand Notice is given within six (6) months after the
effective date of any other registration of any IBC Securities under
the Securities Act.
(d) If any Demand Registration involves an underwritten
offering, the first lead underwriter, and, subject to the last sentence
of this Section 5.1(d), any other underwriter that will administer the
offering will be selected by Xxxxxxx; provided, however, that such
underwriter(s) shall be subject to the approval of IBC which approval
shall not be unreasonably withheld. In the event there is one or more
co-managers, the first such co-manager shall be selected by IBC,
provided that such co-manager shall be subject to the approval of
Xxxxxxx, which approval shall not be unreasonably withheld.
(e) If any Demand Registration involves an underwritten
offering, then as many shares of IBC Securities that IBC elects may be
included in such offering on the same terms and conditions as the IBC
Equity; provided, however, that if the managing underwriter(s) advises
Xxxxxxx and IBC that, in its judgment, the number of shares proposed to
be included in such offering should be limited, then the total number
of shares to be included in such offering will be determined by the
managing underwriter(s) and IBC shall include in such offering
(i) first, all the shares of IBC Equity that Xxxxxxx proposes to sell
and (ii) second all the shares of IBC Securities that IBC proposes to
sell. Except as otherwise provided for in this Agreement or the First
Registration Rights Agreement (as hereinafter defined), no person other
than Xxxxxxx shall be permitted to offer any IBC Securities under any
Demand Registration pursuant to this Section 5.1 without the prior
written consent of Xxxxxxx.
Section 5.2 Delay of Demand Registration.
(a) Notwithstanding anything to the contrary in Article V
hereof, in the event that IBC determines in its reasonable judgment
that it may be advisable to delay filing a Registration Statement
described in Section 5.1 hereof or, to withdraw such Registration
Statement if such Registration Statement has already been filed, IBC
may delay filing such, or withdraw such previously filed, Registration
Statement for a period of not more than ninety (90) days from the date
of receipt of the request for the Demand Registration if IBC furnishes
to Xxxxxxx a certificate signed by the Chairman of the Board of IBC
stating that IBC has reasonably determined that (i) such a filing would
adversely affect any proposed financing or acquisition by IBC or
(ii) such a filing would otherwise represent an undue hardship for IBC;
provided, however, that IBC will be responsible for any reasonable out
of pocket costs (excluding any decline in the IBC Market Price) which
arise out of such delay and IBC will, at the request of Xxxxxxx, file
or refile, as the case may be, such Registration Statement promptly
after IBC, in its judgment, determines that it is no longer advisable
to delay filing or to continue the withdrawal of such Registration
Statement.
(b) IBC may not delay filing or refiling, as the case may
be, a Registration Statement pursuant to Section 5.2(a) hereof, if
following the delay IBC would be required to file audited financial
statements other than audited financial statements included in IBC's
annual report on Form 10-K, unless IBC agrees to provide such audited
financial statements
Section 5.3 Incidental Registration.
(a) Right To Include IBC Equity.
(i) If IBC or any other Person at any time proposes
to register any IBC Securities under the Securities Act (other
than a registration of securities in connection with a merger, an
acquisition, an exchange offer, or an Employee Benefit Plan
maintained by IBC or its Affiliates or on Form S-4 or S-8 or any
successor or similar form), whether or not for sale for its own
account, in a manner which would permit registration of the IBC
Equity for sale to the public under the Securities Act, it will
give written notice to Xxxxxxx (to the extent permitted by such
other Person's current contractual registration rights, if any)
of its intention to do so and of Xxxxxxx'x rights under this
Section 5.3(a)(i), at least thirty (30) calendar days prior to
the anticipated filing date of a Registration statement relating
to such registration (an "Incidental Notice"). Such Incidental
Notice will offer Xxxxxxx the opportunity to include in such
Registration Statement that number of shares of IBC Equity as
Xxxxxxx may request. Upon the written request (which request
will specify the number of shares of IBC Equity intended to be
disposed of by Xxxxxxx pursuant to such Registration Statement)
of Xxxxxxx made within ten (10) calendar days after the receipt
of the Incidental Notice, IBC will use its best efforts to effect
the registration under the Securities Act of all shares of IBC
Equity which IBC has been so requested to register; provided,
however, that (A) if such registration involves an underwritten
offering, Xxxxxxx must sell its IBC Equity requested to be
included in such registration to the underwriter(s) selected by
IBC on the same terms and conditions as apply to other Persons,
including IBC, and (B) if, at any time after receiving a reply
from Xxxxxxx to an Incidental Notice, and prior to the effective
date of the Registration Statement filed in connection with such
registration, IBC decides for any reason not to register any
shares of IBC Securities, IBC will notify Xxxxxxx and thereupon
be relieved of its obligation to register any IBC Equity in
connection with such registration.
(ii) No registration, whether or not effected under
Section 5.3 (a) hereof will relieve IBC of its obligations to
effect Demand Registrations under Section 5.1 hereof.
(b) Priority in Incidental Registrations. If a
registration pursuant to Section 5.3(a) hereof involves an underwritten
offering and the managing underwriter advises IBC in writing, that, in
its opinion, the number of IBC Securities intended to be included in
such Registration Statement exceeds the largest number of IBC
Securities which can be sold without having an adverse effect on such
offering, including the price at which such securities can be sold or,
if in a non-underwritten offering, IBC determines, in its reasonable
discretion, to limit the number of securities to be sold, (in either
case, the "Marketable Number"), IBC will include in such Registration
Statement (i) first, all of the IBC Securities IBC or the Person
referred to in the first sentence of Section 5.3(a)(i) proposes to
sell for its own account, (ii) second, all of the IBC Securities
requested to be included by holders of IBC Securities pursuant
to Section 3 of the First Registration Rights Agreement, (iii)
third, the IBC Securities requested to be included by Xxxxxxx pursuant to
Section 5.3(a) hereof and (iv) fourth, the securities requested to be
included by other Persons (but if the number of securities to be
registered pursuant to clause (iv) together with the number of
securities to be included in such registration pursuant to clauses (i),
(ii) and (iii) of this Section 5.3(b) exceeds the Marketable Number,
the number of securities of Persons to be registered pursuant to clause
(iv) shall be allocated pro rata among such Persons on the basis of the
relative number of IBC Securities each such Person has requested to be
included in such registration).
Section 5.4 Delay of Incidental Registration. Notwithstanding
anything to the contrary in this Article V, in the event that IBC determines
in its reasonable judgment that it may be advisable to delay fling a
Registration Statement described in Section 5.3 hereof or, to withdraw such
Registration Statement if such Registration Statement has already been filed,
IBC may delay filing such, or withdraw such previously filed, Registration
Statement in accordance with the provisions of Section 5.3(a)(i) hereof.
Section 5.5 Third Party Registration Rights. The provisions of
this Article V are in all cases subject to the contractual registration
rights granted by that certain Registration Rights Agreement dated July 23,
1991 (the "First Registration Rights Agreement") by and among IBC, Mezzanine
Investment Limited Partnership-8, 1987 Merchant Investment Partnership,
Merchant LBO Inc. and GKB IX, L.P. IBC hereby represents and warrants that
the First Registration Rights Agreement is the only agreement entered into by
IBC or any of its Associates or Affiliates governing the registration of
shares of IBC Securities. IBC will not extend, amend or waive any provisions
of the First Registration Rights Agreement and will not grant any additional
registration rights to any other Person which could limit or restrict the
registration rights granted Xxxxxxx pursuant to this Agreement.
ARTICLE VI
REGISTRATION EXPENSES
---------------------
Section 6.1 Registration Expenses.
(a) Subject to Section 5.1(b) of this Agreement, all
expenses incident to IBC's performance of or compliance with Articles V
and VII of this Agreement to effect five (5) Demand Registrations will
be borne by IBC, including, without limitation:
(i) all federal registration and filing fees;
(ii) subject to Section 7.4, fees and expenses of
compliance with securities or blue sky laws; provided, however,
that IBC will in no event be obligated to pay the fees and
disbursements of counsel for the underwriters or Xxxxxxx in
connection with blue sky qualifications of the IBC Equity under
the laws of such jurisdictions as the managing underwriter(s) may
designate;
(iii) printing, messenger, telephone and delivery
expenses;
(iv) fees and disbursements of legal counsel for IBC;
(v) fees and disbursements of all independent
certified public accountants of IBC;
(vi) NASD fees and disbursements of the
underwriters; provided, however, that in all cases Xxxxxxx will
pay all costs of discounts, commissions, spreads or fees of
underwriters, selling brokers, dealer managers or similar
securities industry professionals relating to the distribution of
the IBC Equity being sold by Xxxxxxx;
(vii) fees and expenses of other Persons retained by
IBC; and
(viii) listing or quotation fees and expenses required
to be made pursuant to Section 7.6 hereof in connection with the
Registration Statement.
(b) Each of IBC and Xxxxxxx will pay its own internal
expenses (including, without limitation, all salaries and expenses of
its officers and employees performing legal or accounting duties), the
expenses of its annual audit, rating agency fees and fees and expenses
of any Person, including special experts retained by IBC or Xxxxxxx,
respectively.
ARTICLE VII
REGISTRATION PROCEDURE
----------------------
Section 7.1 Xxxxxxx Information. Xxxxxxx will provide IBC with
such information about Xxxxxxx and the intended manner of distribution of IBC
Equity and otherwise cooperate with IBC and the underwriter(s) as may be
necessary in the reasonable opinion of IBC to satisfy any obligation of IBC
under this Agreement to register the IBC Equity under federal or state
securities laws and otherwise take actions related thereto. In the event of
the failure of Xxxxxxx to comply with the requirements of the preceding
sentence IBC may delay filing such, and withdraw such previously filed,
Registration Statement. IBC will file or refile, as the case may be, such
Registration Statement promptly following compliance with such requirements
by Xxxxxxx; provided, however, that Xxxxxxx will be responsible for any
reasonable out of pocket costs which arise out of such non-compliance.
Xxxxxxx will immediately notify IBC upon discovery that any information
provided by Xxxxxxx which is included in the prospectus that is included in a
Registration Statement, as then in effect, is untrue in any material respect,
or omits to state any material fact required to be stated therein or to make
the information stated therein not misleading in the light of the
circumstances under which it is presented.
Section 7.2 Compliance. Each of Xxxxxxx and IBC will comply with
all rules and regulations of The SEC and applicable state securities or blue
sky laws governing, the manner of sale of securities in connection with its
Transfer of any of the IBC Equity pursuant to any Registration Statement.
Section 7.3 Provision of Prospectuses.
(a) IBC will furnish to Xxxxxxx such number of copies of
a summary prospectus or other prospectus, including a prospectus
subject to completion in conformity with the requirements of the
Securities Act, and such other documents as Xxxxxxx may reasonably
request in writing, in order to facilitate the public sale or other
disposition of the IBC Equity included in a Registration Statement.
(b) At any time when a sale or other disposition of IBC
Equity pursuant to a Registration Statement is subject to a prospectus
delivery requirement, IBC will notify Xxxxxxx of the occurrence of any
event that causes the prospectus included in such Registration
Statement, as then in effect, to include an untrue statement of a
material fact or to omit to state a material fact required to be stated
therein or necessary to make the statements therein not misleading in
the light of the circumstances then existing and IBC will use its best
efforts, as expeditiously as possible, to either amend the prospectus
or otherwise take any actions so that use of the previous prospectus
may be legally resumed. Upon receipt of such a notice, Xxxxxxx will
immediately discontinue all sales or other dispositions of IBC Equity
pursuant to the Registration Statement. Xxxxxxx may resume such sales
or dispositions only upon receipt of an amended prospectus or after
Xxxxxxx is advised by IBC that the use of the previous prospectus may
be legally resumed.
Section 7.4 Blue Sky Compliance. IBC will use its best efforts
to (a) register or qualify the IBC Equity included in a Registration
Statement under the securities or blue sky laws of such jurisdictions within
the United States as Xxxxxxx reasonably requests and (b) do any and all other
acts that may be reasonably necessary or advisable to enable Xxxxxxx to
consummate the public sale or disposition of such securities in such
jurisdictions; provided, however, that IBC is not required to consent to, or
take any action that would subject it to, general service of process or
taxation in any jurisdiction where it is not then so subject, nor qualify to
do business in any jurisdiction where it is not then so qualified.
Section 7.5 Maintenance of Effectiveness. IBC will use its best
efforts to prepare and file promptly with the SEC such amendments and
supplements to any Registration Statement, and the prospectus used in
connection therewith, as may be necessary to keep such Registration Statement
continuously effective and in compliance with the Securities Act until the
one hundred twentieth (120th) day following the date on which such
Registration Statement becomes effective, or until all IBC Equity included in
such Registration Statement has been sold, whichever is earlier; provided,
however, that IBC will have no obligation under this Section 7.5 to keep
effective any Registration Statement during the period following any date on
which IBC would be required to file audited financial statements other than
the date by which IBC is required to file its next annual report on Form 10-K
containing such required audited financial statements.
Section 7.6 Listing of IBC Equity. IBC will use its best efforts
to cause the IBC Equity when issued to be listed on all securities exchanges
on which any securities issued by IBC are then listed, or quoted on all
automated quotation systems on which any such securities of IBC are then
quoted, including, without limitation, entering into appropriate
customary agreements (including a listing application and indemnification
agreement in customary form).
Section 7.7 Stop-Orders. IBC will promptly notify Xxxxxxx of
(a) the receipt by IBC of any notification with respect to the issuance by
the SEC of any stop-order or order suspending the effectiveness of any
Registration Statement covering any IBC Equity or the initiation of any
proceedings for that purpose, or (b) the receipt by IBC of any notification
with respect to the limitation, restriction or suspension of the offer or
sale of IBC Equity in any jurisdiction in which the IBC Equity was qualified
to be sold, or the initiation of any proceedings for such purpose. In the
event that IBC notifies Xxxxxxx of any such event, Xxxxxxx will immediately
discontinue all sales or other dispositions of IBC Equity pursuant to the
Registration Statement until such time that IBC notifies Xxxxxxx of the
lifting of such stop-order or similar order; provided, however, that such a
stop-order or similar order issued by a state securities or blue sky
administrator will apply only to offers and sales in such state, unless
Xxxxxxx is advised otherwise by IBC. IBC, with the cooperation of Xxxxxxx,
will use its best efforts to contest any such proceedings and to obtain the
withdrawal of any such order at the earliest possible date.
ARTICLE VIII
INDEMNIFICATION AND CONTRIBUTION
--------------------------------
Section 8.1 Indemnification.
(a) Indemnification by Xxxxxxx.
(i) Xxxxxxx agrees to indemnify and hold harmless
IBC, its Affiliates and Associates (each such Person being
hereinafter referred to as an "IBC Indemnified Party") from and
against all losses, claims, damages, liabilities and expenses
(including reasonable costs of investigation and legal expenses)
(each a "Loss") arising out of or based upon any untrue
statement or alleged untrue statement of a material fact
contained in any Registration Statement or preliminary, final or
summary prospectus covering any IBC Equity, or in any amendment
or supplement thereto, or in any document incorporated by
reference into any of the foregoing or arising out of or based
upon any omission or alleged omission to state therein a material
fact required to be stated therein or necessary to make the
statements therein not misleading, but only if, and only to the
extent, such statement or alleged statement or omission or
alleged omission was made in reliance upon and in conformity with
written information furnished to IBC or its representatives by or
on behalf of Xxxxxxx for use in the preparation of such
Registration Statement, preliminary, final or summary prospectus
or such amendment or supplement thereto, or such document
incorporated by reference. This indemnity will be in addition to
any liability which Xxxxxxx may otherwise have. Xxxxxxx will
also indemnify the underwriter(s), selling broker(s), dealer
manager(s) and similar securities industry professionals
participating in the distribution, their officers and directors
and each Person who Controls such Persons, to the same extent as
provided above with respect to the indemnification of the IBC
Indemnified Party.
(ii) Xxxxxxx also agrees to indemnify and hold
harmless any IBC Indemnified Party from and against all Losses
arising out of any action or proceeding brought against any IBC
Indemnified Party in connection with the distribution or proposed
distribution of IBC Equity to the holders of RAL Stock; provided,
however, that this Section 8.1(a)(ii) shall not apply to any
Losses for which IBC is responsible as provided in Section 8.1(b)
of this Agreement.
(iii) If any action or proceeding (including any
governmental investigation or inquiry) is brought or asserted
against an IBC Indemnified Party in respect of which indemnity
may be sought from Xxxxxxx, such IBC Indemnified Party will
promptly notify Xxxxxxx in writing of the commencement of such
action and Xxxxxxx shall assume the defense thereof and have
primary control over any related suit or proceeding, including
the employment of legal counsel and the payment of all expenses
in connection therewith; provided, however, that the failure of
any IBC Indemnified Party to give notice as provided herein shall
not relieve Xxxxxxx of its obligations under this Section 8.1(a)
except to the extent that Xxxxxxx is actually materially
prejudiced by such failure to give notice. An IBC Indemnified
Party shall have the right to participate in and jointly with
Xxxxxxx, to the extent that it may wish, and employ separate
counsel reasonably satisfactory to such IBC Indemnified Party,
provided, however, that Xxxxxxx will not be liable to such IBC
Indemnified Party for any legal or other expenses subsequently
incurred by such IBC Indemnified Party in connection therewith,
unless such IBC Indemnified Party shall have been advised by
counsel that a conflict of interest between such IBC Indemnified
Party and Xxxxxxx is likely to exist in respect of such claim.
(b) Indemnification by IBC.
(i) IBC agrees to indemnify and hold harmless
Xxxxxxx and its Affiliates and Associates (each such person being
hereinafter referred to as a "Xxxxxxx Indemnified Party") from
and against all Losses arising out of or based upon any untrue
statement or alleged untrue statement of a material fact
contained in any Registration Statement, preliminary, final or
summary prospectus covering any IBC Equity, or in any amendment
or supplement thereto, or in any document incorporated by
reference into any of the foregoing or arising out of or based
upon any omission or alleged omission to state therein a material
fact required to be stated therein or necessary to make the
statement therein not misleading, except insofar as such Losses
arise out of or are based solely upon any such untrue statement
or omission or allegation thereof based upon written information
provided by or on behalf of Xxxxxxx for inclusion in such
Registration Statement, preliminary, final or summary prospectus,
or such amendment or supplement thereto, or such document
incorporated by reference; provided, however, that IBC will not
be liable in any such case to the extent that any such Loss
arises out of or is based upon an untrue statement or alleged
untrue statement or omission or alleged omission made in any
preliminary prospectus if (A) Xxxxxxx failed to send or deliver a
copy of the final prospectus with or prior to the delivery of
written confirmation of the sale of the IBC Equity covered by
the Registration Statement to the Person asserting such Loss, and
(B) the final prospectus would have corrected such untrue statement
or omission and provided, further, that IBC will not be liable in any such
case to the extent that any such Loss arises out of or is based
upon an untrue statement or omission in the final prospectus, if
such untrue statement or omission is corrected in an amendment or
supplement to the final prospectus and if, having previously been
furnished by or on behalf of IBC with copies of the final
prospectus as so amended or supplemented, Xxxxxxx thereafter
fails to deliver such prospectus as so amended or supplemented,
prior to or concurrently with the sale of the IBC Equity to the
Person asserting such Loss who purchased such IBC Equity which is
the subject thereof. This indemnity will be in addition to any
liability which IBC may otherwise have. IBC will also indemnify
the underwriter(s), selling broker(s), dealer manager(s) and
similar securities industry professionals participating in the
distribution, their officers and directors and each Person who
Controls such Persons, to the same extent as provided above with
respect to the indemnification of the Xxxxxxx Indemnified Party.
(ii) If any action or proceeding is brought against
a Xxxxxxx Indemnified Party in respect of which indemnity may be
sought against such Xxxxxxx Indemnified Party, Xxxxxxx will
promptly notify IBC in writing of the commencement of such action
and IBC will assume the defense thereof and have primary control
over any related suit or proceeding, including the employment of
legal counsel and the payment of all expenses in connection
therewith; provided, however, that the failure of any Xxxxxxx
Indemnified Party to give notice as provided herein shall not
relieve IBC of its obligations under this Section 8.1(b) except
to the extent that IBC is actually materially prejudiced by such
failure to give notice. A Xxxxxxx Indemnified Party shall have
the right to participate in and jointly with IBC, to the extent
that it may wish, and employ separate counsel reasonably
satisfactory to such Xxxxxxx Indemnified Party, provided,
however, that IBC will not be liable to such Xxxxxxx Indemnified
Party for any legal or other expenses subsequently incurred by
such Xxxxxxx Indemnified Party in connection therewith, unless
such Xxxxxxx Indemnified Party shall have been advised by counsel
that a conflict of interest between such Xxxxxxx Indemnified and
IBC is likely to exist in respect of such claim.
Section 8.2 Contribution.
(a) If the indemnification provided for in Section 8.1
hereof is unavailable to an IBC Indemnified Party or Xxxxxxx
Indemnified Party under Section 8.1(a) or Section 8.1(b) hereof (other
than by reason of the exceptions provided in Sections 8.1(a) and
8.1(b)) in respect of any Losses referred to therein, then such
indemnifying party, in lieu of indemnifying such indemnified party,
will contribute to the amount paid or payable by such indemnified party
as a result of such Losses in such proportion as is appropriate to
reflect the relative fault of the indemnifying party, on the one hand,
and the indemnified party, on the other hand, in connection with the
statements or omissions which resulted in such Losses, as well as any
other relevant equitable considerations. The relative fault of the
indemnifying party, on the one hand, and the indemnified party, on the
other hand, shall be determined by reference to, among other things,
whether the untrue statement or alleged untrue statement of a material
fact or the omission or alleged omission to state a material fact
relates to information supplied by such indemnified party and each
parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission. The
amount paid or payable by each party as a result of the Losses referred
to above will be deemed to include, subject to the limitations set
forth in Section 8.1(b) hereof, any legal or other fees or expenses
reasonably incurred by such party in connection with investigating or
defending any action or claim.
(b) Notwithstanding the provisions of Section 8.2(a)
hereof, no Person found to be guilty of fraudulent misrepresentation
shall be entitled to contribution from any Person who is not found to
be guilty of such fraudulent misrepresentation.
ARTICLE IX
CALL RIGHTS
-----------
Section 9.1 IBC Call.
(a) At any time during the one-year period commencing on
the fifth anniversary date of this Agreement, IBC shall have the right
to acquire all, but not less than all of the IBC Equity then owned by
Xxxxxxx at a purchase price equal to one hundred and ten percent (110%)
of the IBC Market Price of the IBC Equity then owned by Xxxxxxx (such
right to acquire the IBC Equity is referred to as the "IBC Call").
IBC will notify Xxxxxxx of its election to exercise the IBC Call (a
"Call Notice"), which Call Notice will contain IBC's notice of
election to purchase such shares subject to the IBC Call, the purchase
price of the shares subject to the IBC Call calculated in accordance
with this Section 9.1(a), and the date estimated for consummation of
the purchase and sale (not more than thirty (30) days after the date of
the Call Notice). The consummation of the purchase and sale pursuant
to this Section 9.1(a) will take place no later than thirty (30) days
after the date specified in the Call Notice, subject to the provisions
of Section 9.1(b) hereof and subject to any and all waiting periods
required under any applicable laws or regulations. IBC may assign the
right to purchase such shares subject to the IBC Call to any Person.
Any rights to IBC Equity arising pursuant to an IBC Call shall continue
in effect during the term hereof unless extinguished by IBC pursuant to
a written notice to Xxxxxxx affirmatively relinquishing such rights.
IBC shall be permitted to relinquish rights to acquire all of the IBC
Equity subject to an IBC Call.
(b) Upon the consummation of a purchase and sale pursuant
to Section 9.1(a) hereof:
(i) Xxxxxxx will transfer and deliver to IBC, all
of its right, title and interest in and to the IBC Equity then
owned by Xxxxxxx, free and clear of all liens and encumbrances
and will deliver to IBC a certificate(s) evidencing the shares
sold duly endorsed, or accompanied by written instruments of
transfer in form satisfactory to IBC, duly executed, with evidence
of payment of any applicable stock transfer taxes.
(ii) IBC or its assignee will deliver to Xxxxxxx an
amount in cash equal to the purchase price of the IBC Equity then
owned by Xxxxxxx as set forth in the IBC Call.
(c) The IBC Call shall be exercised within one (1) year
following the expiration of the fifth anniversary date of this
Agreement, and shall expire if not exercised by such date.
ARTICLE X
ADDITIONAL COVENANTS
--------------------
Section 10.1 Maintain Listing or Quotation. IBC hereby covenants
and agrees that it shall use its best efforts to maintain its listing of IBC
Securities on any securities exchanges on which its IBC Securities are
currently listed or on which they are listed in the future pursuant to
Section 7.6 hereof and to maintain its quotation of IBC Securities on an any
automated quotation systems on which its IBC Securities are currently quoted
or on which they are quoted in the future pursuant to Section 7.6 hereto.
Section 10.2 Board of Directors. IBC hereby covenants and agrees
that (a) effective as of the Closing, IBC shall nominate and appoint
Xxxxxxx X. Xxxxxxx and Xx. Xxxxx X. Xxxxxxxx to the board of directors of
IBC, one to hold office until the 1996 annual meeting of IBC shareholders and
one to hold office until the 1997 annual meeting of IBC shareholders, and
(b) the nominee chosen by Xxxxxxx to serve in the 1996 class shall be
nominated and elected to an additional term of not less than two years at the
1996 annual meeting of IBC shareholders. There will be no obligation of IBC
under the terms of this Agreement to nominate any Xxxxxxx representatives
after such terms expire.
Section 10.3 No Inconsistent Agreements. IBC hereby covenants and
agrees that it shall not enter into any agreements governing the transfer or
registration of shares of IBC Securities which would adversely effect
Xxxxxxx'x rights under this Agreement, without Xxxxxxx'x prior written
consent.
Section 10.4 Preferred Stock. IBC hereby covenants and agrees
that during the term of this Agreement, so long as Xxxxxxx owns at least 15%
of the IBC Securities, IBC shall not issue any Person any shares of preferred
stock of IBC which possess voting rights which are greater than the equity
interest represented by such shares of preferred stock of IBC.
Section 10.5 Rule 144 and 144A. IBC hereby covenants and agrees
that it will use its reasonable best efforts to file any reports required to
be filed by it under the Securities Act and Exchange Act and that it will
take such further action as Xxxxxxx may reasonably request, all to the extent
required from time to time to enable Xxxxxxx to sell its IBC Equity (subject
to the terms hereof) without registration under the Securities Act
within the limitation of the exemptions provided by (a) Rule 144 or
144A under the Securities Act, as such Rules may be amended from time to time,
or (b) any similar rule or regulation hereafter adopted by the Commission.
Section 10.6 Maximum Allowed Ownership of IBC Securities. Xxxxxxx
hereby covenants and agrees that on the fifth anniversary of this Agreement
its ownership of IBC Securities shall be no more than 14.9% of the total
outstanding IBC Securities.
ARTICLE XI
MISCELLANEOUS
-------------
Section 11.1 Entire Agreement. This Agreement, constitutes the
entire agreement between the parties hereto relative to the subject matter
hereof, and supersedes all prior written or oral understandings, agreements,
conditions or representations.
Section 11.2 Headings and Captions. All headings and captions
used in this Agreement are for convenience only, and will not be construed to
either limit or broaden the language of this Agreement or any particular
section.
Section 11.3 Choice of Law. This Agreement will be governed by
and construed under and in accordance with the laws of the State of Missouri,
without giving effect to the conflict of laws provisions thereof, except that
all matters relating to the internal affairs of IBC shall be governed by and
construed under and in accordance with the General Corporation Law of
Delaware.
Section 11.4 Venue. Any action or legal proceedings to enforce
this Agreement or any of its terms, or for indemnification and the recovery
of losses as provided for in this Agreement by a party, may be brought and
prosecuted in such court or courts located in the Eastern or Western District
of Missouri as provided by law, and the parties to this Agreement consent to
the jurisdiction of said court or courts and to service of process by
registered mail, return receipt requested, or by any other manner provided by
Missouri law.
Section 11.5 Notices. Any notice or other communication required
or permitted hereunder is deemed delivered when delivered in person, when
transmitted by telecopier (which will also be sent concurrently by certified
or registered mail), on the next Business Day when sent by Federal Express or
a similar overnight delivery service, or on the third Business Day when sent
by registered or certified U.S. mail service as follows:
If to Xxxxxxx or VCS: Office of the Chief Executive Officer
Xxxxxxx Purina Company
Xxxxxxxxxxxx Xxxxxx
Xx. Xxxxx, XX 00000
With a Copy to: Office of the General Counsel
Xxxxxxx Purina Company
Xxxxxxxxxxxx Xxxxxx
Xx. Xxxxx, XX 00000
Attn: Xxxxx X. Xxxxxxx, Esq.
If to IBC: Office of the Chief Executive Officer
Interstate Bakeries Company
00 Xxxx Xxxxxx Xxxxxxxxx
Xxxxxx Xxxx, XX 00000
With Copies to: Office of the General Counsel
Interstate Bakeries Company
00 Xxxx Xxxxxx Xxxxxxxxx
Xxxxxx Xxxx, XX 00000
Attn: Ray Xxxxx Xxxxxx, Esq.
Shook, Hardy & Bacon P.C.
One Kansas City Place
0000 Xxxx Xxxxxx, Xxxxx 0000
Xxxxxx Xxxx, XX 00000
Attn: Xxxxxxxx X. Xxxxxx, Esq.
The parties to this Agreement will promptly notify each other in the manner
provided in this Section 11.5 of any change in their respective addresses. A
notice of change of address will not be deemed to have been given until
received by the addressee.
Section 11.6 Amendments. No changes, modifications, amendments or
additions will be valid unless such be made in writing and signed by or on
behalf of each party.
Section 11.7 Extended Meanings. Words importing the singular
number include the plural and vice versa, and words importing the masculine
gender include the feminine and neuter genders.
Section 11.8 Assignments. In addition to the specific assignment
rights set forth herein, IBC has the right to assign any and all of its
rights or obligations under this Agreement to the surviving entity in a
merger, consolidation, combination or other corporate transaction involving
IBC which agrees in writing with Xxxxxxx to be bound by the terms hereof
Except as otherwise provided herein, Xxxxxxx may not assign any of its rights
or obligations hereunder to any Person.
Section 11.9 Severability. The invalidity or unenforceability of
any provision hereof in any jurisdiction will not affect the validity or
enforceability of this Agreement, including that provision, in any other
jurisdiction. To the extent permitted by applicable law, each party waives
any provision of law that renders any provision hereof prohibited or
unenforceable in any respect. If any term, provision, covenant or
restriction in this Agreement is held by a court of competent jurisdiction
to be invalid, void or unenforceable, the parties hereto will use their best
efforts to find and employ an alternative means to
achieve the same or substantially the same result as that contemplated by
such term, provision, covenant or restriction and the remainder of the terms,
provisions, covenants and restrictions set forth herein shall remain in full
force and effect, in order to achieve the intent of the parties to the extent
possible.
Section 11.10 Counterparts. This Agreement may be executed
simultaneously in two or more counterparts, each of which is deemed an
original, but all of which together constitutes a single agreement, and it is
not necessary in making proof of this Agreement to produce or account for
more than one such counterpart.
Section 11.11 Remedies Cumulative. Except as otherwise
expressly limited herein, the remedies given to any party by this Agreement
are in addition to all remedies under any statute or rule of law. Any
forbearance or failure or delay in exercising any remedy hereunder is not
deemed to be a waiver of any other remedy a party may have under this
Agreement.
Section 11.12 Binding Agreement. This Agreement will be
deemed effective and legally binding upon the parties when it has been
executed and delivered by all parties hereto. This Agreement will inure to
the benefit of the parties hereto and their permitted successors and
assignees.
Section 11.13 Recapitalizations, Exchanges, Etc., Affecting
IBC Securities. The provisions of this Agreement apply to the full extent
set forth herein with respect to the IBC Equity, to any and all shares of
capital stock of IBC or any successor or assign of IBC (whether by merger,
consolidation, sale of assets, or otherwise) which may be issued in respect
of, in exchange for, or in substitution of, IBC Equity and will be
appropriately adjusted for any stock dividends, splits, reverse splits,
combinations, recapitalizations and the like occurring after the date hereof.
Section 11.14 Other Agreements. Nothing contained in this
Agreement will be deemed to be a waiver of, or release from, any obligations
any party hereto may have under any other agreement, including, without
limitation, the Purchase Agreement.
Section 11.15 Term., Effectiveness. The term of this
Agreement will begin'(and this Agreement will become effective) upon the date
hereof and will continue until the date which is five (5) years from the date
hereof; provided, however, that Article IX and Section 2.1 shall survive
until the date which is six (6) years from the date hereof. The provisions
of Articles VI and VIII hereof shall survive the termination of this
Agreement.
Section 11.16 Enforcement. Each of IBC and Xxxxxxx agrees
that any breach of the provisions contained in this Agreement by IBC and/or
Xxxxxxx would cause irreparable harm to the other and its Affiliates and,
therefore, notwithstanding any right of IBC and/or Xxxxxxx to recover
monetary damages with respect to any such breach as set forth in (a) this
Agreement or (b) at law, IBC and Xxxxxxx will each be entitled to
equitable relief to enjoin any threatened or continuing breach of the
other hereof and, in the event of any action for specific performance,
each party shall waive the defense that a remedy at law would be
adequate. If the scope of any restriction contained in this Agreement is too
broad to permit enforcement to its full extent, then such restriction will be
enforced to the maximum extent permitted by law in the manner provided in
Section 11.9 hereof. Nothing herein stated will be construed as prohibiting
any party from pursuing any other remedies available to that party for a
breach hereunder, including recovery of damages.
Section 11.17 Confidentiality. Each of Xxxxxxx and IBC
acknowledges that the other would be irreparably damaged if confidential
knowledge of its business and affairs were disclosed or utilized on behalf of
any Person. Each of IBC and Xxxxxxx covenants and agrees not to disclose or
use any such confidential information of the other unless such information
has been made available to the public generally (other than in violation of
this Section 11.17) or IBC and/or Xxxxxxx is required to disclose such
information by a governmental body or regulatory agency or by law in
connection with a transaction that is not otherwise prohibited hereby.
Performance by IBC and Xxxxxxx of their respective obligations under this
Section 11.17 shall be in accordance with the provisions set forth on
Exhibit A attached hereto, which Exhibit is incorporated herein and made a
part hereof.
Section 11.18 Fiduciary Accounts. IBC and Xxxxxxx each
acknowledge and agree that this Agreement shall apply only to the IBC
Securities owned by Xxxxxxx for its own account and does not apply to any IBC
Securities which may be deemed to be beneficially owned or controlled by
Xxxxxxx or its Affiliates and which shares are held in fiduciary accounts in
connection with any pension plans, profit sharing plans or other employee
benefit plans or held in any other fiduciary accounts.
IN WITNESS WHEREOF the parties have executed this Agreement by an
officer thereunto duly authorized, all as of the day and year first above
written.
ATTEST: INTERSTATE BAKERIES CORPORATION
By: /s/ Ray Xxxxx Xxxxxx By: /s/ Xxxx X. Xxxxxx
-------------------- ------------------
Its Secretary Its Vice President
ATTEST: XXXXXXX PURINA COMPANY, on its
behalf and on behalf of its Affiliates
By: /s/ N.E. Xxxxxxxx By: /s/ Xxxxx X. Xxxxxxx
----------------------- --------------------
Its Assistant Secretary Its Vice President
ATTEST: VCS HOLDING COMPANY
By: /s/ N.E. Xxxxxxxx By: /s/ X.X. Xxxxxx
----------------------- ---------------
Its Assistant Secretary Its Secretary
EXHIBIT A
Exhibit A
For purposes of Section 11.17 of the Shareholder Agreement by and among
Interstate Bakeries Corporation, Xxxxxxx Purina Company and VCS Holding
Company, the following provisions shall apply:
1. "Confidential Information" shall include all information
provided heretofore or hereafter by either Xxxxxxx or IBC (individually, a
"Company" and collectively, the "Companies") or their representatives,
Affiliates, advisors officers, directors, employees or agents
("Representatives"), to the other. The term "Confidential Information"
also will include any analyses, studies or other documents prepared by
Representatives of a Company containing or based in whole or in part on any
information furnished to the other. Confidential Information shall not
include information which (i) becomes generally available to the public other
than as a result of a disclosure in violation hereof by a Company or its
Representatives, (ii) was in the possession of a Company on a non-
confidential basis prior to its disclosure or (iii) becomes available to a
Company on a non-confidential basis from a source other than the other
Company, which source is entitled to make the disclosure without violation of
any obligation of confidentiality to a Company or other party.
2. Each Company recognizes and acknowledges the competitive value
and the confidential and proprietary nature of the Confidential Information
and the damage that could result to the other Company if information
contained therein is disclosed to any third party. Each Company agrees that
it will not use the Confidential Information in any manner that is
competitive with or detrimental to the business or operations of the other
Company. Each Company further agrees that it will not disclose any of the
Confidential Information to any person or entity without the prior written
consent of the other Company; provided, however, that there may be a
disclosure of such information to such of its Representatives that need to
know such information in connection with any transactions between the
Companies or for valid business reasons which do not otherwise violate the
provisions of this agreement. Each Company acknowledges that its
Representatives are bound hereto to the same extent as each Company as if
there were parties hereto, and each Company shall be responsible for any
breach hereof by any of its Representatives.
3. Each Company agrees that a breach of the provisions hereof may
give rise to irreparable injury to the other Company that cannot be
compensated for adequately by monetary damages. Consequently, each Company
shall be entitled from the other Company, in addition to all other remedies
available, to injunctive and other equitable relief to prevent a breach
hereof and to secure the enforcement hereof in any court of competent
jurisdiction in the United States or any state thereof.
4. Each Company hereby acknowledges that it is aware, and will
advise its Representatives and financing sources who are informed as to
the matters which are the subject hereof, that the federal and state
securities law prohibit any person who has received material, non-
public information concerning the matters that are related hereto
from purchasing or selling securities of the Companies or from communicating
such information to any other person under circumstances in which it is
reasonably foreseeable that such person is likely to purchase or sell such
securities.
5. If either Company is requested or becomes legally compelled to
disclose any of the Confidential Information, such Company agrees that it
will provide the other Company with prompt written notice of such request so
that the other Company may seek a protective order. In the event that such
protective order or other remedy is not obtained, the Company agrees to
furnish only that portion of the Confidential Information and other
information that it is legally obligated to disclose.
6. At either Company's request, the other agrees to promptly return
or, at such Company's option, to destroy the Confidential Information and all
copies thereof. All copies, extracts or other reproductions in whole or in
part thereof shall be destroyed and not retained by the other Company or its
representatives in any form or for any reason, and such destruction shall be
certified in writing to the requesting Company by an authorized officer
supervising such destruction. All documents, pleadings, court filings,
memoranda, notes and other writings whatsoever prepared by the other Company
or its representatives based on the Confidential Information (except, in the
case of pleadings and court filings, to the extent reasonably required for
proper record keeping purposes) shall be destroyed, and such destruction
shall be certified in writing to the requesting Company by an authorized
officer supervising such destruction.
7. If any provision hereof or the application of any such provision
to any person or circumstance is held invalid, illegal or unenforceable for
any reason whatsoever, the remaining provisions and the application of such
provision to other persons or circumstances shall not be affected thereby.
To the fullest extent possible the court finding such provision invalid,
illegal or unenforceable shall modify and construe the provisions as to
render it valid and enforceable as against all persons or entities and to
give the maximum possible protection to each of the Companies and their
Representatives within the bounds of validity, legality and enforceability.
8. The provisions hereof shall continue in effect throughout the
term of the Shareholder Agreement.
SUPPLEMENT TO SHAREHOLDER AGREEMENT
July 25,1995
In conjunction with the execution of the Shareholder Agreement by and
among Interstate Bakeries Corporation ("IBC"), Xxxxxxx Purina Company and
VCS Holding Company of even date herewith (the "Shareholder Agreement"),
subject to the restriction in the following paragraphs, it is agreed by the
parties hereto that officers, directors and employees of Xxxxxxx who are or
would be deemed to be Affiliates of Xxxxxxx under the Shareholder Agreement
will be allowed to acquire IBC Securities during the term of the Shareholder
Agreement without Xxxxxxx violating Sections 2.1(a) or 2.1(b) of the
Shareholder Agreement.
The preceding paragraph is subject to the restriction that under no
circumstances during the term of the Shareholder Agreement shall IBC
Securities acquired in reliance hereof by such officers, directors or
employees who are or would be deemed to be Affiliates result in such
individuals owning in the aggregate, at any time during the term of the
Shareholder Agreement, more than 2% of the total outstanding shares of the
IBC Securities. In addition, any acquisitions of IBC Securities by such
officers, directors and employees in reliance hereof shall not be made at the
direction of or in concert with Xxxxxxx.
Xxxxxxx shall be under no obligation to attempt to prevent such
individuals from independently acquiring IBC Securities unless Xxxxxxx
becomes aware by any means, including notification by IBC, that a proposed
purchase would result in the 2% threshold being exceeded. In the event that
Xxxxxxx becomes aware or is notified by IBC that the 2% threshold has been
exceeded at any time during the term of the Shareholder Agreement, then
Xxxxxxx will use its reasonable best efforts to cause the individual or
individuals who last purchased IBC Securities which resulted in the 2%
threshold being exceeded to divest a sufficient number of shares of IBC
Securities so as to decrease the aggregate ownership of all of such officers,
directors and employees below the 2% threshold. Xxxxxxx shall further
request such officers, directors and employees to refrain from purchasing
such IBC Securities until such time that IBC has notified Xxxxxxx that the
risk of exceeding the 2% threshold has sufficiently diminished.
If the Chief Executive Officer of IBC notifies RPC that the number of
shares of IBC Securities owned by such officers, directors and employees who
are or would be deemed to be Affiliates of Xxxxxxx continues to exceed the 2%
threshold, whether on a continuous or recurrent basis, then Xxxxxxx shall
immediately take such action necessary (including the delivery of one of its
Demand Notices) to divest at least that number of shares of IBC Securities
equal to the greatest number of shares owned by such officers, directors and
employees who would be deemed to be Affiliates in excess of the 2% threshold
in the prior 60 days.
Nothing herein shall be deemed a modification or amendment of any of
the definitions of the Shareholder Agreement. Except for the consent of IBC
to the purchase of IBC Securities by Persons who are or would be deemed to be
Affiliates of Xxxxxxx, none of the other terms or provisions of the
Shareholder Agreement are amended or modified hereby. Nothing herein shall
be deemed to be a pre-approval by IBC or its Board of Directors of any
purchases of IBC Securities by such officers, directors or employees for
purposes of Section 203 of the Delaware General Corporation Law or Article
NINTH of the Certificate of Incorporation of IBC, as amended.
INTERSTATE BAKERIES CORPORATION
By: /s/ Xxxx X. Xxxxxx
------------------
Its Vice President
XXXXXXX PURINA COMPANY
By: /s/ Xxxxx X. Xxxxxxx
--------------------
Its General Counsel,
Vice President and
Secretary
VCS HOLDING COMPANY
By: /s/ X X Xxxxxx
--------------
Its Secretary
Interstate Bakeries Corporation Letterhead
July 3, 1997
Xx. Xxxxx Xxxxxxxx
Vice President and CFO
Xxxxxxx Purina Company
Checkerboard Square - Floor 15T
Xx. Xxxxx, XX 00000
Dear Xx. Xxxxxxxx:
This letter amends the Shareholder Agreement dated July 22, 1995 by and
among Interstate Bakeries Corporation ("IBC"), Xxxxxxx Purina Company
("Xxxxxxx") and VCS Holding Company (the "Shareholder Agreement").
The parties agree that if the consummation of the SAILS transaction
occurs between July 22, 1997 and August 15, 1997, then certain provisions of
the Shareholder Agreement shall be deemed amended as set forth below. If the
SAILS transaction is consummated prior to July 22, 1997 or is not consummated
by August 15, 1997, then the Shareholder Agreement shall not be deemed to be
amended as set forth below.
1. The phrase "until the sixth anniversary date of this Agreement"
in Section 2.1 of the Shareholder Agreement shall be replaced
with "until 24 days after the sixth anniversary date of this
Agreement."
2. The phrase "commencing on the fifth anniversary date of this
Agreement" in Section 9.l(a) of the Shareholder Agreement shall
be replaced with "commencing on the 24th day after the fifth
anniversary of the date of this Agreement."
3. The phrase "within one (1) year following the expiration of the
fifth anniversary date" in Section 9.1(c) of the Shareholder
Agreement shall be replaced with "within one (1) year and 24
days following the expiration of the fifth anniversary date."
4. The phrase "on the fifth anniversary date of this Agreement" in
Section 10.6 of the Shareholder Agreement shall be replaced with
"on the 24th day after the fifth anniversary date of this
Agreement."
5. The phrase "which is five (5) years from the date hereof," in
Section 11.15 of the Shareholder Agreement shall be replaced
with "which is five (5) years and 24 days from the date hereof"
and the phrase "which is six (6) years from the date hereof" in
Section 11.15 shall be replaced with "which is six (6) years and
24 days from the date hereof."
If the foregoing is acceptable to you, please indicate by signing two
of the originals of each of this letter where indicated and return them to
us.
INTERSTATE BAKERIES CORPORATION
/s/ Ray Xxxxx Xxxxxx
------------------------
By: Ray Xxxxx Xxxxxx
Title: Vice President
XXXXXXX PURINA COMPANY
/s/ Xxxxx X. Xxxxxxxx
------------------------------
By: Xxxxx X. Xxxxxxxx
Title: Vice President and CFO
cc: Xxxxx X. Xxxxxxx, Esq.
General Counsel
Xxxxxxx Purina Company
Xxxxxxxxxxxx Xxxxxx
Xx. Xxxxx, XX 00000
Xxxx X. Xxxxxx
Vice President and Treasurer
Interstate Bakeries Corporation
00 Xxxx Xxxxxx Xxxxxxxxx
Xxxxxx Xxxx, XX 00000
AMENDMENT TO SHAREHOLDER AGREEMENT
This Amendment to the Shareholder Agreement, dated as of March 30, 2000
("Amendment"), is made by and among Interstate Bakeries Corporation, a
Delaware corporation ("IBC"), Xxxxxxx Purina Company, a Missouri corporation
("Xxxxxxx"), and Tower Holding Company, Inc., a Delaware corporation and
wholly-owned subsidiary of Xxxxxxx, and successor to VCS Holding Company
("VCS"), for the purpose of amending and supplementing the Shareholder
Agreement by and among IBC, Xxxxxxx and VCS, dated July 22, 1995 (the
"Shareholder Agreement"), as supplemented and amended by the Supplement to
Shareholder Agreement by and among IBC, Xxxxxxx and VCS, dated July 25, 1995
(the "Supplement Agreement"). Defined terms used herein without definition
shall have the meanings ascribed to them in the Shareholder Agreement.
WITNESSETH:
WHEREAS, IBC and Xxxxxxx entered into the Shareholder Agreement to
provide certain rights and restrictions with respect to the IBC Equity owned
by Xxxxxxx; and
WHEREAS, the parties have agreed to extend the term of the Shareholder
Agreement and to make certain amendments to the provisions of the Shareholder
Agreement; and
WHEREAS, the parties agree that by entering this Amendment they
acknowledge and confirm that they will continue to be bound by the terms of
the Shareholder Agreement, as previously amended and supplemented by the
Supplement Agreement and by this Amendment;
NOW, THEREFORE, in consideration of the mutual covenants and
obligations set forth herein, the parties agree as follows:
1. Except as specifically provided in, and as amended by, this Amendment,
the rights and restrictions with respect to the IBC Equity set forth in
the Shareholder Agreement and the Supplement Agreement shall continue
during the term hereof.
2. The recital paragraph of the Shareholder Agreement is hereby deleted
and replaced with the following:
"THIS SHAREHOLDER AGREEMENT dated July 22, 1995 (the "Agreement"), is
made by and among INTERSTATE BAKERIES CORPORATION, a Delaware corporation
("IBC"), XXXXXXX PURINA COMPANY, a Missouri corporation ("Xxxxxxx") and
VCS HOLDING COMPANY, a Delaware corporation and a wholly-owned subsidiary
of Xxxxxxx ("VCS")."
3. The first WHEREAS clause of the Shareholder Agreement is hereby amended
by substituting "Xxxxxxx" for "RPC" in the second line.
4. Section 1.29 of the Shareholder Agreement is hereby deleted and
replaced with the following:
"Section 1.29 RAL Stock. "RAL Stock means Xxxxxxx'x $.10 par value
Common Stock, or any other class of common stock of Xxxxxxx at any time
outstanding."
5. Section 1.33 of the Shareholder Agreement is deleted.
6. The introductory sentence to Section 2.1 of the Shareholder Agreement
is hereby deleted and replaced with the following:
"Section 2.1 Standstill Covenants. Unless specifically requested or
permitted in writing in advance by the Chairman of the Board of IBC or
unless otherwise permitted in this Agreement, Xxxxxxx agrees that until
August 1, 2006, neither it nor any of its Affiliates will, directly or
indirectly:"
7. The introductory language before "(i)" in Section 2.3 of the
Shareholder Agreement is hereby deleted and replaced with the
following:
"Section 2.3 Voting of IBC Equity. Xxxxxxx agrees that during the
term of this Agreement, with respect to the election of directors of
IBC, each class of IBC Equity owned by Xxxxxxx and its Affiliates shall
be voted."
8. Section 3.1 of the Shareholder Agreement is hereby deleted and replaced
with the following:
"Section 3.1 Restrictions of Transfer. During the term of this
Agreement, Xxxxxxx agrees that it will not, and it will cause each of
its Affiliates who have acquired IBC Equity under this Agreement, or
who may acquire IBC Equity pursuant to Section 3.2(b) of this
Agreement, not to Transfer any IBC Equity except as permitted by or in
accordance with this Agreement."
9. Section 4.1(a) of the Shareholder Agreement is hereby deleted and
replaced with the following:
"(a) Except for Transfers permitted by Section 3.2(a) and (b), and
Transfers to a Person making a tender offer for outstanding IBC Equity
which is recommended to shareholders of IBC by the board of directors
of IBC, during the term of this Agreement, Xxxxxxx and its Affiliates
shall not sell any shares of IBC Equity to any Person unless it has
first made an offer (the "First Offer") to sell such shares to IBC in
accordance with this Article IV and such First Offer shall have been
rejected or not accepted within the Applicable Acceptance Period (as
hereinafter defined); provided, however, that if Xxxxxxx or any of its
Affiliates propose to sell a specified number of shares of IBC Equity
pursuant to a Transfer permitted by Section 3.2(f) and the First Offer
shall have been rejected by IBC, the proposed Transfer by Xxxxxxx or
its Affiliates may proceed at any time thereafter under Rule 144
without regard to the 20 day period referenced in Section 4.1(d)."
10. Section 4.2 of the Shareholder Agreement is hereby deleted and replaced
with the following:
"Section 4.2 Purchase of the Offered Shares. In the event IBC
rejects the First Offer or fails to deliver a Notice of Exercise within
the Applicable Acceptance Period, then Xxxxxxx may proceed with the
Transfer pursuant to Articles V, VI, VII and VIII hereof, if
applicable; provided that, a Person upon purchasing such shares from
Xxxxxxx will not own more than fifteen percent (15%) of the outstanding
IBC Equity."
11. Sections 5.1(c), (d) and (e) of the Shareholder Agreement are hereby
deleted and replaced with the following:
"(c) IBC will be obligated to effect only one (1) Demand Registration
under Section 5.1 hereof; provided, however, that IBC will not be
required to register the IBC Equity pursuant to a Demand Notice under
Section 5.1 hereof if at such time (i) the shares of IBC Equity which
Xxxxxxx is requesting to be registered pursuant to Section 5.1 hereof
constitutes less then five percent (5%) of such class or series of the
outstanding IBC Securities so requested to be registered or (ii) such
Demand Notice is given within six (6) months after the effective date
of any other registration of any IBC Securities under the Securities
Act."
"(d) Any Demand Registration to be effective pursuant to this
Article V shall only be accomplished in an underwritten offering which
is designed to cause the widespread distribution and sale of such
underwritten securities. The first lead underwriter, and, subject to
the next sentence of this Section 5.1(d), any other underwriter
that will administer the offering will be selected by Xxxxxxx;
provided, however, that such underwriter(s) shall be subject to
the approval of IBC, which approval shall not be unreasonably
withheld. In the event there is one or more co-managers, the
first such co-manager shall be selected by IBC, provided that
such co-manager shall be subject to the approval of Xxxxxxx,
which approval shall not be unreasonably withheld. Xxxxxxx agrees
to use reasonable efforts in connection with any Demand Registration
to assure the widespread distribution and sale of such underwritten
securities and Xxxxxxx agrees to request that the underwriters use
reasonable efforts to assure the widespread distribution and sale of
such underwritten securities."
"(e) In any such Demand Registration there may be included as many
shares of IBC Securities that IBC elects to be included on the same
terms and conditions as the IBC Equity; provided, however, that if the
managing underwriter advises Xxxxxxx and IBC that, in its judgment, the
number of shares proposed to be included in such offering should be
limited, then the total number of shares to be included in such
offering will be determined by the managing underwriter and IBC shall
include in such offering (i) first, all the shares of IBC Equity that
Xxxxxxx proposes to sell and (ii) second all the shares of IBC
Securities that IBC proposes to sell. Except as otherwise provided for
in this Agreement or the First Registration Rights Agreement (as
hereinafter defined), no person other than Xxxxxxx shall be permitted
to offer any IBC Securities under any Demand Registration pursuant to
this Section 5.1 without the prior written consent of Xxxxxxx."
12. The first sentence of Section 9.1(a) of the Shareholder Agreement is
hereby deleted and replaced with the following:
"(a) At any time during the one-year period commencing on August 1,
2005, IBC shall have the right to acquire all, but not less than all,
of the IBC Equity then owned by Xxxxxxx and its Affiliates at a
purchase price equal to one-hundred and ten percent (110%) of the IBC
Market Price of the IBC Equity then owned by Xxxxxxx and its Affiliates
(such right to acquire the IBC Equity is referred to as the "IBC
Call").
13. Section 9.1(c) of the Shareholder Agreement is hereby deleted and
replaced with the following:
"(c) The IBC Call shall be exercised within one (1) year following
August 1, 2005, and shall expire if not exercised by such date."
14. Section 10.2 of the Shareholder Agreement is hereby deleted.
15. Section 10.6 of the Shareholder Agreement is hereby deleted and
replaced with the following:
"Section 10.6 Maximum Allowed Ownership of IBC Securities.
"(a) Xxxxxxx agrees that if it has not sold the IBC Equity owned by
Xxxxxxx and its Affiliates prior to August 15, 2000 it shall cause the
principal amount of each Stock Appreciation Income Linked Securities
("SAILS") related to its 7% Exchangeable Notes Due August 1, 2000 to be
mandatorily exchanged into shares of IBC Stock and not into cash or
other consideration."
"(b) Xxxxxxx agrees that between the execution of this Amendment and
September 30, 2000, Xxxxxxx shall sell, or Xxxxxxx shall cause its
Affiliates to sell, shares of IBC Equity equal to the amount of IBC
Equity that Xxxxxxx and its Affiliates hold in excess of twenty (20%)
of the IBC Securities outstanding on September 30, 2000, such sales
being made pursuant to the terms of the Shareholder Agreement."
"(c) Xxxxxxx covenants and agrees that by August 1, 2004, the
ownership of IBC Securities by Xxxxxxx and its Affiliates shall be not
more than 15% of the then total outstanding IBC Securities."
"(d) Xxxxxxx covenants and agrees that by August 1, 2005 the ownership
of IBC Securities by Xxxxxxx and its Affiliates shall be not more than
10% of the then total outstanding IBC Securities."
"(e) In the event that the SAILS are not exchanged into shares of IBC
Stock by August 15, 2000 or that Xxxxxxx and its Affiliates do not
accomplish the complete sale (or exchange in the case of the SAILS) of
IBC Equity provided for in (a), (b), (c), or (d) above by the
prescribed dates, IBC shall thereafter be entitled to purchase at one
time or from time to time, all or any portion of the unsold IBC Equity
owned by Xxxxxxx and its Affiliates which would otherwise be required
to be sold (or the number of shares of IBC Stock resulting from the
exchange of SAILS in the case of (a) above at a purchase price equal to
the IBC Market Price of the IBC Equity."
16. The first sentence of Section 11.15 of the Shareholder Agreement is
hereby deleted and replaced with the following:
"Section 11.15 Term; Effectiveness. The term of this Agreement will
begin (and this Agreement will become effective) upon the date hereof
and will continue until August 1, 2005; provided, however, that
Article IX and Section 2.1 shall survive until August 1, 2006."
17. A new Section 11.19 is added to the Shareholder Agreement, as follows:
"Section 11.19 Certain Matters Concerning Affiliates. For purposes
of Sections 2.3, 9.1(a) and 10.6, it is understood and agreed that the
term "Affiliates" shall only be deemed to apply to entities Controlled
by Xxxxxxx.
18. In all other respects, the parties hereby agree that the Shareholder
Agreement, and the Supplement Agreement, shall remain in full force and
effect.
IN WITNESS WHEREOF, the parties have executed this Amendment to
Shareholder Agreement and Supplement Agreement as of the 30th day of March,
2000.
INTERSTATE BAKERIES CORPORATION
/s/ Ray Xxxxx Xxxxxx
------------------------
By: Ray Xxxxx Xxxxxx
XXXXXXX PURINA COMPANY
/s/ Xxxxx X. Xxxxxxx
------------------------
By: Xxxxx X. Xxxxxxx
TOWER HOLDING COMPANY, INC.
/s/ Xxxxx X. Xxxxxxxx
-------------------------
By: Xxxxx X. Xxxxxxxx
