STOCKHOLDER SUPPORT AGREEMENT
THIS STOCKHOLDER SUPPORT AGREEMENT (this "Agreement"), is made and
entered into, as of the date indicated on the signature page hereof, by and
between the Xxxxxx X. Xxxxxx Irrevocable Trust (the "Stockholder"), a
stockholder of Universal International, Inc., a Minnesota corporation (the
"Company"), and 99 CENTS Only Stores, a California corporation ("99 CENTS Only
Stores").
WHEREAS, as of the date hereof, the Stockholder owns of record and
beneficially an aggregate of 220,000 shares of Common Stock, par value $0.05
per share ("Company Common Stock") of the Company (such shares of Company
Common Stock, together with any other voting or equity securities of the
Company hereafter acquired by the Stockholder prior to the termination of
this Agreement, being referred to herein collectively as the "Shares");
WHEREAS, 99 CENTS Only Stores proposes to make a tender offer to
acquire all of the issued and outstanding shares of Company Common Stock (the
"Offer") pursuant to which 99 CENTS Only Stores will offer to exchange one
share of Common Stock, no par value, of 99 CENTS Only Stores, for 16 shares of
Company Common Stock (the "Exchange Ratio") ( the purchase (if any) of shares
of the Common Stock of Universal pursuant to the Offer is referred to herein
as the "Closing," and the date of such purchase (if any) of shares of the
Common Stock of Universal pursuant to the Offer is referred to herein as the
"Closing Date"); and
WHEREAS, as a condition to the willingness of 99 CENTS Only Stores
to make the Offer, 99 CENTS Only Stores has requested that the Stockholder
agree, and in order to induce 99 CENTS Only Stores to make the Offer, the
Stockholder has agreed, to enter into this Agreement and perform its
obligations hereunder.
NOW, THEREFORE, in consideration of the foregoing and the mutual
covenants and agreements contained herein, and intending to be legally bound
hereby, the parties hereby agree as follows:
Section 1. VOTING OF SHARES. Subject to the provisions of Section 3
below, the Stockholder hereby agrees that, at any meeting of the stockholders
of the Company, however called, and in any action by consent of the
stockholders of the Company, the Stockholder will vote all of the Shares (a)
in favor of the Offer and (b) in favor of any other matter deemed necessary
by 99 CENTS Only Stores to effectuate the Offer or solicited in connection
with the Offer, and considered and voted upon by the stockholders of the
Company (or any class thereof).
Section 2. TENDER OF SHARES. Subject to the provisions of Section 3
below, the Stockholder hereby irrevocably agrees to tender and sell all of
the Shares to 99 CENTS Only Stores pursuant to the terms of the Offer.
Section 3. THE OFFER. Stockholder's obligations under Section 1 and
2 above are conditioned upon (x) the actual exchange ratio included as part
of the Offer being no less favorable to the Stockholder than the Exchange
Ratio, and (y) the Stockholder receiving in consideration for his tender
pursuant to Section 2 above, the same per share consideration offered to the
stockholders of the Company generally in the Offer. In addition, following
commencement of the Offer, 99 CENTS Only Stores shall be obligated to purchase
and acquire the Shares concurrent with its acquisition of the first shares of
Company Common Stock it acquires from any stockholder of the Company pursuant
to the Offer.
Section 4. TRANSFER OF SHARES. Other than for sales of Shares to
99 CENTS Only Stores made pursuant to the Offer or otherwise, from and after
the date hereof until the earlier of any termination of this Agreement in
accordance with the terms hereof or the Closing Date, the Stockholder will
not, directly or indirectly, (a) sell, assign, transfer, pledge, encumber or
otherwise dispose of any of the Shares, (b) deposit any of the Shares into a
voting trust or enter into a voting agreement or arrangement with respect to
any of the Shares or grant any proxy or power of attorney with respect
thereto which is inconsistent with this Agreement or (c) enter into any
contract, option or other arrangement or undertaking with respect to the
direct or indirect sale, assignment, transfer or other disposition of any
Company Common Stock.
Section 5. TERMINATION. This Agreement shall terminate (a) only
with the written consent of 99 CENTS Only Stores and Stockholder or (b) on the
first to occur of (x) that date (whether prior to or following commencement
of the Offer, and prior to such time (if any) that the Company actually
purchases any shares of the Common Stock of Universal) on which the Company
announces that it has determined not to proceed with the Offer, and (y)
September 30, 1998.
Section 6. MISCELLANEOUS.
a. This Agreement constitutes the entire agreement between the
parties hereto with respect to the subject matter hereof and supersedes all
prior agreements and understandings, both written and oral, between the
parties with respect thereto. This Agreement may not be amended, modified or
rescinded except by an instrument in writing signed by each of the parties
hereto.
b. This Agreement and all other similar agreements entered into
concurrently herewith include all of the shares held of record and held
beneficially by Stockholder and any and all trusts with which either party is
affiliated which hold of record of beneficially any shares of Company Common
Stock.
c. If any term or other provision of this Agreement is invalid,
illegal or incapable of being enforced by any rule of law, or public policy,
all other conditions and provisions of this Agreement shall nevertheless
remain in full force and effect. Upon such determination that any term or
other provision is invalid, illegal or incapable of being enforced, the
parties hereto shall negotiate in good faith to modify this Agreement so as
to effect the original intent of the parties as closely as possible to the
fullest extent permitted by applicable law in a mutually acceptable manner in
order that the terms of this Agreement remain as originally contemplated to
the fullest extent possible.
d. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF MINNESOTA WITHOUT REGARD TO THE
PRINCIPLES OF CONFLICTS OF LAW THEREOF.
e. This Agreement may be executed in counterparts, each of which
shall be deemed an original and all of which together shall constitute one
and the same instrument.
f. The Stockholder acknowledges that 99 CENTS Only Stores's rights
hereunder are unique and that it will not have adequate remedies at law for
the Stockholder's failure to perform his obligations hereunder. Accordingly,
it is agreed that 99 CENTS Only Stores shall have the right to specific
performance and equitable injunctive relief for the enforcement of such
obligations in addition to all other available remedies at law or in equity.
IN WITNESS WHEREOF, each of the parties hereto has caused this
Agreement to be duly executed as of the 24th day of February, 1998.
99 CENTS Only Stores
By: /s/ Xxxxx Xxxx
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Name: Xxxxx Xxxx
Its: Chairman of the Board, Chief Executive
Officer and President
STOCKHOLDER
THE XXXXXX X. XXXXXX IRREVOCABLE TRUST
/s/ Xxxx Xxxxxx
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Xxxx Xxxxxx, Trustee
