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EXHIBIT 99-1
STOCKHOLDERS AGREEMENT
DATED AS OF NOVEMBER 13, 1997
By and Among
GREEN EQUITY INVESTORS, L.P.,
XXXXXX X. XXXXXX,
XXXXXX X. XXXXXX,
and
BIG 5 HOLDINGS CORP.
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STOCKHOLDERS AGREEMENT
This STOCKHOLDERS AGREEMENT (this "AGREEMENT") is entered into as of
November 13, 1997, by and among Green Equity Investors, L.P., a Delaware limited
partnership ("GEI"), Xxxxxx X. Xxxxxx ("XX XXXXXX"), Xxxxxx X. Xxxxxx ("XX
XXXXXX" and together with XX Xxxxxx, the "MILLERS") and Big 5 Holdings Corp., a
Delaware corporation (the "PARENT"), with respect to the following facts and
circumstances:
A. Substantially simultaneously with the execution of this Agreement,
Parent and Big 5 Corp, a Delaware corporation, successor to United Merchandising
Corp., a California corporation ("SUBSIDIARY"), are consummating the
transactions described under the caption "The Recapitalization" contained in
that certain Offering Memorandum, dated November 8, 1997 (the "OFFERING
MEMORANDUM"), (the "RECAPITALIZATION").
B. Upon consummation of the Recapitalization, GEI will own 723,577
shares of the Common Stock, par value $0.01 per share, of Parent (the "COMMON
STOCK"), XX Xxxxxx will own approximately 250,509 shares of Common Stock, XX
Xxxxxx will own 200,000 shares of Common Stock and members of the families of
the Millers will own 100,000 shares of Common Stock.
C. Parent, GEI and the Millers desire, for their mutual benefit and
protection, to enter into this Agreement to set forth their respective rights
and obligations with respect to certain corporate governance issues respecting
Parent and Subsidiary.
NOW THEREFORE, in consideration of the foregoing and for other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
ARTICLE 1
Definitions
1.1 Definitions. In addition to certain terms that are defined elsewhere
herein, as used in this Agreement, the following definitions shall apply:
1.1.1 "AFFILIATE" means, with respect to any Person, any other
Person (other than Parent or Subsidiary) directly or indirectly, through one or
more intermediaries, controlling, controlled by or under common control with any
such Person and, when used with reference to any natural Person, shall also
include such Person's spouse, parents and descendants (whether by blood or
adoption, and including stepchildren), the spouses of such Persons, the siblings
of such Persons and trusts for the benefit of any of the foregoing Persons;
provided, however, that there shall be excluded from the foregoing any entity
formed or existing as part of a transaction or activity in the course of
Parent's or Subsidiary's business. The term "control" (including the terms
"controlling," "controlled by" and "under common control with") means the
possession,
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direct or indirect, of the power to direct or cause the direction of the
management and policies of a Person, whether through the ownership of voting
securities of a Person, by contract or otherwise.
1.1.2 "NASDAQ" means The Nasdaq Stock Market, Inc.'s National Market
or SmallCap systems.
1.1.3 "OPTIONS" means any warrant, option, security convertible or
exchangeable into Common Stock (or stock of any subsidiary) or other right to
acquire Common Stock (or stock of any subsidiary), including, without
limitation, employee stock options.
1.1.4 "PERSON" means an association, a corporation, an individual, a
partnership, a limited liability company or limited liability partnership, a
trust or any other entity, association or organization.
1.1.5 "PREFERRED STOCK" means Parent's Series A 13.45% Senior
Exchangeable Preferred Stock.
1.1.6 "STOCKHOLDER" means each of GEI and the Millers, in each case
together with its and their respective Affiliates, and any other Person who
shall become a party to or agree to be bound by the terms of this Agreement
after the date hereof, together with its and their Affiliates.
1.1.7 "SHARES" means shares of Common Stock and shares of Preferred
Stock, whether now directly or indirectly owned or controlled by any Stockholder
(or Affiliate thereof) or hereafter acquired by any Stockholder (or Affiliate
thereof) in any manner, including upon exercise of any Option.
1.1.8 "SUBSIDIARY" means in addition to Big 5 Corp, a Delaware
corporation, successor to United Merchandising Corp., a California corporation,
any direct or indirect wholly-owned subsidiary of Parent, whether now existing
or hereafter organized or acquired.
ARTICLE 2
Voting Agreements
2.1 Board of Directors. Each Stockholder shall, and shall cause its
Affiliates to, vote any and all Common Stock held by such Stockholder and its
Affiliates in order to effect the following at all times:
2.1.1 Number of Directors. Parent and Subsidiary each shall be
governed by a Board of Directors consisting of five (5) members. Of such
directors, (i) two (2) shall be designated by GEI (the "GEI DIRECTORS") and (ii)
two (2) shall be the Millers and one (1) or, if either of the Millers shall for
reasons of health be unable to serve as a director, then two (2), shall be
designated by the Millers (the "MILLERS'
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DIRECTORS"). Each of GEI and the Millers, respectively, (the "REMOVING PARTY"),
by notice to the other such party, shall be entitled to cause the parties hereto
to act to remove any of the GEI Directors or Xxxxxx Directors, respectively,
originally designated by such Removing Party. In such event the parties shall
act promptly to cause such removal of any of the GEI Directors or Xxxxxx
Directors originally designated by the Removing Party and to cause the election
of a replacement GEI Director or Xxxxxx Director as designated by the Removing
Party and permitted by this Section. In the event that the size of the Board of
Directors of Parent or Subsidiary is increased or decreased, the number of GEI
Directors and Xxxxxx Directors on such Board of Directors shall be equitably
adjusted so that the Xxxxxx Directors shall constitute a simple majority of the
Board of Directors and the number of GEI Directors shall be increased
proportionately to the number of Xxxxxx Directors.
2.1.2 Initial Board of Directors. The Board of Directors of Parent
and of Subsidiary as of the date of this Agreement consist of the following
members:
Name of Director Designated By:
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XX Xxxxxx Millers
XX Xxxxxx Millers
Xx. Xxxxxxx X. Xxxxxx Millers
Xxxx X. Xxxxxxx GEI
Xxxx X. Xxxxxxx GEI
Each of such persons shall hold office until his or her death,
resignation or removal or until his or her successor shall thereafter have been
duly elected and qualified. By signing this Agreement, each of the parties
hereby consents to the election of the foregoing designees to the initial Board
of Directors of Parent and Subsidiary.
2.1.3 Vacancies; Action by Board of Directors. If a vacancy is
created on the Board of Directors of either of Parent or Subsidiary by reason of
the death, disability, removal or resignation of any director, the party who
originally designated the director whose death, disability, removal or
resignation resulted in such vacancy shall be entitled to designate a new Xxxxxx
Director or GEI Director, as the case may be, to fill such vacancy, and Parent
or Subsidiary, as the case may be, shall cause the remaining directors to meet
within ten (10) business days after the date such vacancy occurs for the purpose
of electing the designated new director to fill such vacancy. Each Stockholder
with respect to Parent, and Parent with respect to Subsidiary, shall take such
steps as are necessary to cause the election of the person so designated to fill
such vacancy.
2.2 Supermajority Director Votes. The parties acknowledge and agree
that, under the Certificate of Incorporation and Bylaws of Parent and of
Subsidiary as they exist on the date hereof and shall exist during the term of
this Agreement, the approval of the following actions shall require a vote of at
least eighty percent (80%) of the authorized number of directors of the
corporation (which such number of authorized directors shall include such number
of directors as may at that time be entitled to be elected by holders of any
series of Preferred Stock of the corporation). If the number of
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authorized directors of Parent or of Subsidiary is ever increased above nine
(9), then the percentage vote required for approval of such actions shall be
equitably increased so that the affirmative vote of at least one of the GEI
Directors is required to approve such actions.
2.2.1 a sale, assignment, lease, transfer, conveyance or other
disposition involving all or substantially all of the assets or capital stock of
the corporation or any of its subsidiaries; a merger, consolidation or other
business combination, or a transaction in which all stockholders of Parent are
not treated equally;
2.2.2 adoption of a plan of dissolution or liquidation of the
corporation or any of its subsidiaries;
2.2.3 any increase in the compensation to either of the Millers, or
any Affiliates of the Millers, except any increase in compensation in the
ordinary course of business not materially different from past practices
(including the practices of any predecessor by merger);
2.2.4 the issuance of any shares of capital stock, or any options,
warrants or rights (including convertible or exchangeable securities) to acquire
shares of capital stock, of the corporation, except shares of capital stock
issued for cash in connection with the exercise of compensatory employee Options
issued by the corporation in the ordinary course of business not materially
different from past practices (including the practices of any predecessor by
merger), provided that Subsidiary may only issue shares of capital stock to
Parent;
2.2.5 the corporation entering into, or permitting any subsidiary to
enter into, any arrangement or contract with any Person which, together with its
Affiliates, beneficially owns or has a Option to acquire, directly or
indirectly, five percent (5%) or more of the outstanding shares of any class of
stock of the corporation or with any Affiliate of such Person, except for any
arrangement or contract that exists as of the date hereof and any extensions and
non-material modifications and amendments thereof;
2.2.6 the (i) redemption, retirement, purchase or other acquisition
for value of any shares of the corporation, (ii) assignment to any person of
Parent's right to purchase or acquire shares of the corporation pursuant to
Article ELEVENTH of the Certificate of Incorporation of Parent, or (iii) making
of any determination with respect to any shares of the corporation pursuant to
such Article ELEVENTH, other than the redemption or repurchase of Common Stock
in the ordinary course of business (A) constituting (in a transaction or series
of related transactions) less than one (1) percent of the outstanding Common
Stock of the corporation on the date or dates of purchase pursuant (x) to
Article ELEVENTH or (y) to a contractual obligation to the holder of any such
security, or (B) in amounts that are not material pursuant to any management
stock purchase agreement consistent with past practices (including the practices
of any predecessor by merger);
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2.2.7 the determination to have the corporation or any of its
subsidiaries enter into any lines of business other than retail merchandising of
sporting goods and other business activities ancillary thereto;
2.2.8 the transfer, disposition or issuance of any shares of capital
stock, or any options, warrants or rights (including convertible or exchangeable
securities) to acquire shares of capital stock, of or by any subsidiary of the
corporation, or by any other Person that is a wholly-owned subsidiary of such
subsidiary, other than issuances by such a wholly-owned subsidiary to its
immediate parent; and
2.2.9 any amendment of the Certificate of Incorporation or Bylaws of
the corporation that would alter or affect in any way the supermajority director
voting requirements.
The parties agree that during the term of this Agreement, without the prior
written consent of GEI, no Stockholder shall take any action or vote or give its
consent to any amendment or change of the Certificate of Incorporation or Bylaws
of either Parent or Subsidiary that would alter or affect in any way the
supermajority director voting requirements set forth above. Further, the parties
agree that if for any reason they cannot agree on an equitable adjustment to the
supermajority vote as a result of a change in the number of directors, then the
number of directors necessary to approve any of the actions enumerated above
shall be changed by amendment to the Certificate of Incorporation and/or Bylaws
(as applicable) of the corporation to require the affirmative vote of all of the
directors less one (1).
2.3 Binding Agreements on Affiliates and Transferees. Each of the
Millers and GEI agrees to cause its Affiliates who own Common Stock from time to
time to enter into a counterpart of this Agreement (at the date hereof as to
Affiliates who own such Common Stock at the date hereof or upon acquiring such
Common Stock hereafter) and thereby such Affiliate shall agree to vote such
Common Stock in the same manner as the party with respect to whom such Person is
an Affiliate is obligated to vote any Common Stock owned by such party. In the
event that prior to the Common Stock being listed or admitted to trading on a
national securities exchange or quoted on the NASDAQ and the rules and
regulations of such national securities exchange or the NASDAQ, as the case may
be, any Stockholder shall transfer any of the Common Stock owned by any of them
to a person who is not an Affiliate of the transferor, then as a condition to
such transfer, the transferee shall be obligated to enter into a counterpart of
this Agreement and thereby agree to vote such Common Stock in the same manner as
such person's transferor was obligated to vote such Common Stock and to cause
such Person's transferees to be bound by the terms and conditions of this
Agreement.
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ARTICLE 3
Tag-Along Rights
3.1 Right to Participate in Sale. If (i) the Millers (and any Affiliated
transferee or transferees of equity securities of the Millers) enter into an
agreement to transfer, sell or otherwise dispose of any interest (including the
grant of an option) in ("Transfer") more than fifty percent (50%) of the
aggregate shares of Common Stock held by them or (ii) the Millers (and any
Affiliated transferee or transferees of equity securities of the Millers) and
any other stockholders of Parent, with or without the participation or
involvement of Parent, acting as a group within the meaning of Rule 13d or 14d
of the Securities Exchange Act of 1934, as amended, whether or not applicable,
enter into an agreement, arrangement or series of agreements or arrangements (A)
to Transfer more than fifty percent (50%) of the then outstanding shares of
Common Stock of Parent or (B) to Transfer a combination of outstanding and newly
issued Common Stock that would constitute more than fifty percent (50%) of the
shares of Common Stock of Parent to be outstanding upon the completion of the
Transfer or related series of Transfers (collectively, any such proposed
transferor or transferors (excluding Parent), the "MAJORITY STOCKHOLDER" and
each such Transfer or related series of Transfers, a "TAG-ALONG SALE"), then the
Millers, and Parent if it is a Transferor, shall as a condition of such
Tag-Along Sale, arrange for GEI (including, for purposes of this Article 3, the
Affiliates and transferees of GEI) to have the right, but not the obligation, to
participate in such Tag-Along Sale with respect to the Common Stock proposed to
be sold by the Majority Stockholder. The number of shares of Common Stock that
GEI will be entitled to include in a Tag-Along Sale ("GEI'S ALLOTMENT") shall be
determined by multiplying (a) the total number of shares of such Common Stock
proposed to be Transferred pursuant to the Tag-Along Sale (other than shares
proposed to be issued by Parent), by (b) a fraction, the numerator of which
shall equal the aggregate number of shares of such Common Stock owned by GEI on
the day immediately preceding the Tag-Along Notice Date (as defined below) and
the denominator of which shall equal the sum of (I) the aggregate number of
shares of such Common Stock owned by the Majority Stockholder plus (II) the
aggregate number of shares of such Common Stock held by all other Persons
holding shares of such Common Stock of Parent and the aggregate number of shares
of such Common Stock subject to stock options to acquire such Common Stock held
by Persons who have tag-along rights with regard to such shares or shares
subject to stock options, and others who may have tag-along rights relative to
the Majority Stockholder, in each case, on the day immediately preceding the
Tag-Along Notice Date. The "TAG-ALONG NOTICE DATE" shall be the date that the
Tag-Along Sale Notice (as defined below) is first delivered, mailed or sent by
courier or telecopy to GEI.
3.2 Limitation on Representations; Indemnity. Any sales of Common Stock
by GEI (and Persons with similar or derivative tag-along rights) as a result of
the "Tag- Along Rights" granted to GEI pursuant to this Agreement shall be on
the same terms and conditions as the proposed Tag-Along Sale by the Majority
Stockholder; provided, however, that in negotiating a Tag-Along Sale, the
Millers and, if applicable, Parent
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shall use their or its reasonable, good faith efforts to provide (i) that the
only representation and warranty which GEI shall be required to make in
connection with any Transfer is a warranty with respect to its own ownership of
the shares to be sold by it and its ability to convey title thereto free and
clear of liens, encumbrances or adverse claims, and (ii) that the liability of
GEI with respect to any representation and warranty made in connection with any
Transfer is the several (and not joint) liability of GEI and that such liability
is limited to the amount of proceeds actually received by GEI.
3.3 Sale Notice. The Millers and, if applicable, Parent shall provide
GEI with written notice (the "TAG-ALONG SALE NOTICE") not more than sixty (60)
nor less than twenty (20) days prior to the proposed date of the Tag-Along Sale
(the "TAG-ALONG SALE DATE"). Each Tag-Along Sale Notice shall set forth: (i) the
name and address of each proposed transferee or purchaser of shares in the
Tag-Along Sale; (ii) the number of shares proposed to be Transferred by the
Majority Stockholder and, if applicable, Parent; (iii) the proposed amount and
form of consideration to be paid for such shares and the terms and conditions of
payment offered by each proposed transferee or purchaser; (iv) the aggregate
number of shares of Common Stock proposed to be Transferred that are held of
record as of the close of business on the day immediately preceding the
Tag-Along Notice Date by the Majority Stockholder; (v) GEI's Allotment assuming
GEI elected to sell the maximum number of shares of Common Stock possible; (vi)
confirmation that the proposed purchaser or transferee has been informed of the
"Tag-Along Rights" provided for herein and has agreed to purchase shares of such
Common Stock in accordance with the terms hereof; and (vii) the Tag-Along Sale
Date.
3.4 Tag-Along Notice. If GEI wishes to participate in the Tag-Along
Sale, it shall provide written notice (the "TAG-ALONG NOTICE") to the Millers
and, if applicable, Parent no less than ten (10) business days prior to the
Tag-Along Sale Date. The Tag-Along Notice shall set forth the number of shares
of Common Stock proposed to be Transferred that GEI elects to include in the
Tag-Along Sale, which shall not exceed GEI's Allotment. The Tag-Along Notice
shall also specify the aggregate number of additional shares of Common Stock
owned of record as of the close of business on the day immediately preceding the
Tag-Along Notice Date by GEI, if any, which GEI desires also to include in the
sale ("ADDITIONAL SHARES") in the event there is any under-subscription for the
entire amount of shares that may be included by Persons having, and pursuant to,
tag-along rights relative to the Majority Stockholder (collectively, the
"SELLERS' ALLOTMENTS"). In the event there is an under-subscription of the
entire amount of such Sellers' Allotments, the Millers and, if applicable,
Parent shall apportion the unsubscribed Sellers' Allotments to such holders
whose tag-along notices specified an amount of Additional Shares, which
apportionment shall be on a pro rata basis among such holders in accordance with
the number of Additional Shares specified by all such holders in their Tag-Along
Notice. The Tag-Along Notice given by GEI shall constitute its binding agreement
to sell such Common Stock on the terms and conditions applicable to the
Tag-Along Sale, subject to the provisions of Section 3.2 above and provided
further that, in the event that there is any material change in the terms and
conditions of such Tag-Along Sale applicable to GEI after GEI gives such
Tag-Along Notice, then, notwithstanding anything herein to the contrary, GEI
shall have the right to elect not to
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participate in the Tag-Along Sale with respect to any or all of its shares of
Common Stock affected thereby. If the proposed transferee or purchaser does not
purchase all of such shares on the same terms and conditions applicable to the
Millers (except as otherwise provided herein), then the Millers and, if
applicable, Parent shall not consummate the Tag-Along Sale of any of their or
its shares to such transferee or purchaser, unless the shares of GEI and the
Majority Stockholder are reduced or limited pro rata in proportion to the
respective number of shares actually sold in any such Tag-Along Sale and GEI
elects to Transfer its shares on such revised terms.
3.5 Failure to Exercise. If a Tag-Along Notice is not received by the
Millers and, if applicable, Parent from GEI prior to the ten (10)-day period
specified above, the Majority Stockholder shall have the right to Transfer the
number of shares specified in the Tag-Along Sale Notice to the proposed
purchaser or transferee without any participation by GEI, but only on terms and
conditions which are no more favorable in any material respect to each of the
Millers and, if applicable, Parent than as stated in the Tag-Along Sale Notice
to GEI and only if such Tag-Along Sale occurs on a date within sixty (60)
business days of the Tag-Along Sale Date.
3.6 Exempt Transfers. The provisions of Section 3.1 shall not apply to
(i) any bona fide offering of Common Stock pursuant to an effective registration
statement under the Act or any bona fide public distribution of Common Stock
pursuant to Rule 144 thereunder, or (ii) any Transfer without consideration
(other than nominal consideration to satisfy legal title transfer requirements)
by the Millers to one of their affiliates (except that (A) prior to any such
disposition the party receiving such shares of Common Stock shall agree in
writing to be bound by the terms of this Agreement applicable to the Millers as
if such Transferee were an original party hereto and (B) any such shares of
Common Stock shall continue to be subject to this Agreement).
ARTICLE 4
Representations and Warranties
4.1 Representations and Warranties of Parent.
Parent represents and warrants to the Stockholders as follows:
4.1.1 Organization. It is a corporation duly organized and validly
existing under the laws of the State of Delaware.
4.1.2 Authority. It has full corporate power and authority to
execute, deliver and perform this Agreement and to consummate the transactions
contemplated hereby.
4.1.3 Binding Obligation. The execution, delivery and performance of
this Agreement by it and the consummation by it of the transactions contemplated
hereby have been duly and validly authorized by all necessary corporate action
on its part, and,
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assuming the due authorization, execution and delivery of this Agreement by each
of the other parties hereto, this Agreement constitutes its binding obligation,
enforceable against it in accordance with its terms, except as may be limited by
bankruptcy, insolvency, reorganization, moratorium and other similar laws and
equitable principles relating to or limiting creditors' rights generally.
4.1.4 No Conflict. The execution, delivery and performance of this
Agreement by it and the consummation by it of the transactions contemplated
hereby will not, with or without the giving of notice or the lapse of time or
both, (i) violate any provision of law, statute, rule or regulation to which it
is subject, (ii) violate any order, judgment or decree applicable to it, or
(iii) conflict with, or result in a breach or default under, any term or
condition of its Certificate of Incorporation or Bylaws or any material
agreement or other material instrument to which it is a party or by which it or
its property is bound or affected.
4.2 Representations and Warranties of GEI. GEI represents and warrants
to the Millers and to Parent as follows:
4.2.1 Organization. It is a limited partnership duly organized and
validly existing under the laws of its state of organization.
4.2.2 Authority. It has full power and authority to execute, deliver
and perform this Agreement and to consummate the transactions contemplated
hereby.
4.2.3 Binding Obligation. The execution, delivery and performance of
this Agreement by it and the consummation by it of the transactions contemplated
hereby have been duly and validly authorized by all necessary action on its
part, and, assuming the due authorization, execution and delivery of this
Agreement by each of the other parties hereto, this Agreement constitutes its
binding obligation, enforceable against it in accordance with its terms, except
as may be limited by bankruptcy, insolvency, reorganization, moratorium and
other similar laws and equitable principles relating to or limiting creditors'
rights generally.
4.2.4 No Conflict. The execution, delivery and performance of this
Agreement by it and the consummation by it of the transactions contemplated
hereby will not, with or without the giving of notice or the lapse of time or
both, (i) violate any provision of law, statute, rule or regulation to which it
is subject, (ii) violate any order, judgment or decree applicable to it, or
(iii) conflict with, or result in a breach or default under, any term or
condition of its charter, bylaws or equivalent governing documents or any
material agreement or other material instrument to which it is a party or by
which it or its property is bound or affected.
4.3 Representations and Warranties of the Millers. Each of the Millers,
severally and not jointly, represents and warrants to GEI and to Parent as
follows:
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4.3.1 Authority. He has full power and authority to execute, deliver
and perform this Agreement and to consummate the transactions contemplated
hereby.
4.3.2 Binding Obligation. Assuming the due authorization, execution
and delivery of this Agreement by each of the other parties hereto, this
Agreement constitutes his binding obligation, enforceable against him in
accordance with its terms, except as may be limited by bankruptcy, insolvency,
reorganization, moratorium and other similar laws and equitable principles
relating to or limiting creditors' rights generally.
4.3.3 No Conflict. The execution, delivery and performance of this
Agreement by him and the consummation by him of the transactions contemplated
hereby will not, with or without the giving of notice or the lapse of time or
both, (i) violate any provision of law, statute, rule or regulation to which he
is subject, (ii) violate any order, judgment or decree applicable to him, or
(iii) conflict with, or result in a breach or default under, any term or
condition of any material agreement or other material instrument to which he is
a party or by which he or his property is bound or affected.
ARTICLE 5
Miscellaneous
5.1 Termination. The provisions of Article 2 of this Agreement shall
terminate on, and be of no further force and effect after, the first to occur of
the following: (i) the date the Common Stock is listed or admitted to trading on
a national securities exchange or quoted on NASDAQ, (ii) the date the Millers
and their Affiliates own less than fifty percent (50%) of the Common Stock owned
by them immediately following the consummation of the Recapitalization, (iii)
the date the shares of Common Stock of Parent outstanding immediately following
the consummation of the Recapitalization constitute less than fifty percent
(50%) of the outstanding Common Stock of Parent on a fully diluted basis taking
into account Options, (iv) the death or permanent disability of both of the
Millers so that they are no longer willing or able to serve as Xxxxxx Directors
or (v) December 1, 2007.
5.2 Recapitalization, Exchanges, etc. Affecting the Common Stock. The
provisions of this Agreement shall apply to the full extent set forth herein
with respect to (i) the Common Stock and any Option to acquire Common Stock,
(ii) any and all shares of capital stock or other securities of Parent or any
successor or assign of Parent (whether by merger, consolidation, stock sale,
sale of assets, exchange or otherwise) which may be issued in respect of, in
exchange for, or in substitution for the Common Stock or any Options, by
combination, recapitalization, reclassification, merger, consolidation or
otherwise, and (iii) any shares of capital stock or other securities of Parent
or any successor or assign received in connection with any stock split, stock
dividend, stock combination or other recapitalization or similar event; and in
each such case the provisions of this Agreement shall be appropriately adjusted
so that the
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Stockholders receive all of the benefits of, and have all of the obligations
under, this Agreement with respect to all such securities.
5.3 Notices. All notices, requests, claims, demands and other
communications hereunder shall be in writing and shall be deemed to have been
duly given upon receipt if delivered personally or sent by facsimile
transmission (receipt of which is confirmed) or by courier service promising
overnight delivery (with delivery confirmed the next day) or three (3) business
days after sent by registered or certified mail (postage prepaid, return receipt
requested). Notices shall be addressed as follows:
To Parent: Big 5 Holdings Corp.
0000 Xxxx Xx Xxxxxxx Xxxxxxxxx
Xx Xxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxx Xxxxx, General Counsel
Facsimile: (000) 000-0000
With a copy to: Irell & Xxxxxxx LLP
000 Xxxxx Xxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxx X. Xxxxxxx, Esq.
Facsimile: (000) 000-0000
To GEI: Green Equity Investors, L.P.
c/o Xxxxxxx Xxxxx & Partners, L.P.
00000 Xxxxx Xxxxxx Xxxxxxxxx
Xxxxx 0000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxxxx Xxxxxx Xxxxxx
Facsimile: (000) 000-0000
To the Millers: Xxxxxx X. Xxxxxx
Xxxxxx X. Xxxxxx
c/o Big 5 Holdings Corp.
0000 Xxxx Xx Xxxxxxx Xxxxxxxxx
Xx Xxxxxxx, Xxxxxxxxxx 00000
Facsimile: (000) 000-0000
Any party may from time to time change its address for the purpose of notices by
a similar notice specifying the new address but no such change shall be
effective as against any Person until such Person shall have actually received
it.
5.4 Specific Performance. The parties hereto agree that if any of the
provisions of this Agreement were not performed in accordance with their
specific terms or were otherwise breached, irreparable damage would occur, no
adequate remedy at law would exist and damages would be difficult to determine,
and that the parties shall be entitled
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to specific performance of the terms hereof (without requirement to post bond),
in addition to any and all other remedies at law or in equity.
5.5 Amendment; Waiver. This Agreement may be amended, modified,
supplemented or terminated only by a written instrument signed by Parent and
each Stockholder. No provision of this Agreement may be waived orally, but only
by a written instrument signed by the party against whom enforcement of such
waiver is sought. Stockholders shall be bound from and after the date of the
receipt of a written notice from Parent setting forth such amendment or waiver,
whether or not the Common Stock shall have been marked to indicate the same. No
alteration, modification or impairment shall be implied by reason of any
previous waiver, extension of time, delay or omission in exercise, or other
indulgence.
5.6 Further Assurances. Each party hereto agrees to execute any and all
further documents and writings and to perform such other actions which may be or
become necessary or expedient to effectuate and carry out this Agreement.
5.7 No Third-Party Benefits. None of the provisions of this Agreement
shall be for the benefit of, or enforceable by, any third-party beneficiary.
5.8 Interpretation. For all purposes of this Agreement, except as
otherwise expressly provided, all terms defined herein include the plural as
well as the singular and the words "include," "includes" and "including" shall
be deemed in each case to be followed by the words "without limitation."
5.9 Assignability. This Agreement shall be binding upon, inure to the
benefit of, and be enforceable by, the parties hereto and their respective
successors and assigns.
5.10 Severability. If any provision hereof shall be held to be
unenforceable or invalid by any court of competent jurisdiction or as a result
of future legislative action, such holding or action shall be strictly construed
and shall not alter the enforceability, validity or effect of any other
provision hereof.
5.11 Entire Agreement. This Agreement contains the final and entire
agreement among the parties with respect to the matters contemplated hereby and
supersedes all written or verbal representations, warranties, commitments and
other understandings prior to the date hereof. No reference shall be made to any
draft of this Agreement for purposes of interpretation or resolution of
ambiguity or otherwise.
5.12 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of California.
5.13 Attorney's Fees. In any suit or proceeding arising out of this
Agreement to interpret or enforce any provision of this Agreement, the
prevailing party shall be entitled to all reasonable out-of-pocket expenses and
reasonable attorneys' fees incurred by such party in connection with such suit
or proceeding.
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5.14 Captions. The descriptive headings herein are inserted for
convenience only and are not intended to be part of or to affect the meaning
or interpretation of this Agreement.
5.15 Information Regarding Beneficial Ownership. Each Stockholder agrees
to promptly provide to Parent any information or representations that Parent
may request regarding such Stockholder's beneficial ownership of Common Stock.
5.16 Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original but all of which
together shall constitute one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement
as of the day and year first set forth above.
[SIGNATURE BLOCKS OMITTED]
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