SCHEDULE 13D: EXHIBIT 3
SHAREHOLDERS' AGREEMENT
THIS SHAREHOLDERS' AGREEMENT (the "Agreement") is made and entered into as
of the ____ day of ________, 2001, by and among The Raytech Corporation Asbestos
Personal Injury Settlement Trust (the "PI Trust"), Xxxxxx Xxxxxxx, not
individually but solely as the Shareholder Representative (as such term is
defined in Raytech Corporation's Second Amended Plan of Reorganization), and
Raytech Corporation ("Raytech").
R E C I T A L S:
WHEREAS, Raytech has reorganized under the provisions of Chapter 11 of the
Bankruptcy Code in a case pending in the United States District Court for the
District of Connecticut, known as In re Raytech Corporation, Debtor, Case No.
0-00-00000; and
WHEREAS, Raytech Corporation's Second Amended Plan of Reorganization (the
"Plan") has been confirmed by the Bankruptcy Court; and
WHEREAS, the Plan provides, inter alia, for the PI Trust to provide
"tag-along" rights to the Public Shareholders (as such term is defined below) of
Raytech in certain defined circumstances;
WHEREAS, this Agreement establishes the mechanism for providing the
tag-along rights to the Public Shareholders;
NOW, THEREFORE, in consideration of the premises set forth above and the
mutual covenants herein contained, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS AND CONSTRUCTION
1.01. Definitions. For purposes hereof, the following terms when used
herein and initially capitalized shall have the meanings set forth below:
"Legal Representative" shall mean and include any Person empowered or
entitled to act with respect to the property of the PI Trust, including, but not
limited to, any executor, administrator or trustee.
"Person" means a natural person, a partnership, a corporation, a limited
liability company, an association, a joint stock company, a trust, a joint
venture, an unincorporated organization or other entity, or a governmental
entity or any department, agency or political subdivision thereof.
"Public Shareholder" means any Person that holds New Raytech Common Stock
(as such term is defined in the Plan) that is not the PI Trust, the United
States of America or the State of Connecticut.
1.02 Construction. The masculine pronoun whenever used herein shall be
construed so as to include the feminine and the neuter, and the singular shall
be deemed to include the plural, whenever the context so requires.
ARTICLE II
TAG-ALONG RIGHTS
(a) In the event that the PI Trust desires to sell 90% or more of the New
Raytech Common Stock issued to the PI Trust on the Effective Date, as adjusted
for any subsequent stock splits, dividends, recapitalizations or similar events,
to a Person and its affiliates and subsidiaries in a single transaction or a
series of transactions (a "Proposed Purchaser" and such transfer, a "Proposed
Transfer"), then such PI Trust's right to accept or initiate such a transaction
shall be conditioned upon the Proposed Purchaser making a tender offer to the
Public Shareholders to purchase a pro rata portion (equivalent to the percentage
of New Raytech Common Stock to be purchased from the PI Trust) of such Public
Shareholders' New Raytech Common Stock for the same price per share, with the
same form of consideration and otherwise upon the same terms and conditions as
the Proposed Transfer.
(b) The PI Trust shall, not less than 30 days prior to a Proposed
Transfer, notify the Shareholder Representative in writing of such Proposed
Transfer (the "Proposed Transfer Notice"). Such Proposed Transfer Notice shall
set forth: (i) the number of shares of New Raytech Common Stock proposed to be
transferred (the "Transferred Securities"); (ii) the name(s) and address(es) of
the Proposed Purchaser(s); (iii) the proposed amount and all forms of
consideration and terms and conditions of payment offered by such Proposed
Purchaser, including the proposed date for the closing of the Proposed Transfer
(the "Scheduled Closing"); and (iv) that the Proposed Purchaser has been
informed of the tag-along rights of the Public Shareholders provided for in this
Section and has agreed to purchase the Transferred Securities in accordance with
the terms hereof.
(c) In the event that the Proposed Purchaser(s) does not effect the tender
offer to purchase New Raytech Common Stock from such Public Shareholders as
required by Section 2.01(a) hereof, then the PI Trust shall not sell any New
Raytech Common Stock to the Proposed Purchaser pursuant to the Proposed
Transfer.
ARTICLE III
ENDORSEMENT ON STOCK CERTIFICATE
3.01 Upon the Effective Date of the Plan, all certificates evidencing the
shares New Raytech Common Stock distributed to the PI Trust pursuant to the Plan
shall be endorsed as follows:
"NOTICE: This certificate and the shares of common stock
evidenced hereby are subject to the restrictions stated in, and
may not be sold, transferred, encumbered, or otherwise disposed
of in any manner, voluntarily or involuntarily, except upon
compliance with the provisions of that certain Shareholders'
Agreement dated as of __________, 2001, copies of which are on
file in the offices of the PI Trust , and the provisions of
which are incorporated herein by reference."
ARTICLE IV
SPECIFIC PERFORMANCE: INJUNCTIVE RELIEF
By execution and delivery hereof, each party hereto hereby
acknowledges and agrees that each of the parties to this
Agreement will be entitled to enforce such party's rights under
this Agreement specifically, to recover damages by reason of any
breach of any provision of this Agreement and to exercise all
other rights existing in such party's favor. The parties hereto
agree and acknowledge that money damages will not be an adequate
remedy for any breach of the provisions of this Agreement and
that any party may in such party's sole discretion apply to any
court of competent jurisdiction for specific performance or
injunctive relief in order to enforce or prevent any violations
of the provisions of this Agreement, without the necessity of
posting a bond or proving actual damages.
ARTICLE V
TERM
5.01 Term. This Agreement shall commence on the date hereof and
shall continue until terminated upon the earliest to occur of any of
the following events:
(a) dissolution of Raytech or the PI Trust;
(b) the completion of a tender offer for the shares of
New Raytech Common Stock held by Public Shareholders
as required by Section II(a) hereof;
(c) the fifteenth year anniversary of this Agreement.
5.02 Termination. Upon termination of this Agreement, Raytech or
the PI Trust shall, upon surrender to it by the PI Trust of the
certificates representing the outstanding Shares then held by the PI
Trust, issue to the PI Trust new certificates for an equal number of
Shares but without the endorsement set forth in Article IV hereof.
ARTICLE VI
COMPENSATION
6.01 Annual Fee. Raytech shall pay the Shareholder
Representative an annual fee of $10,000.00, payable in advance.
6.02 Expenses. Raytech shall reimburse the Shareholder
Representative for all reasonable out-of-pocket expenses incurred in
connection with the performance of his or her responsibilities under
this Agreement, excluding attorneys' fees; provided, however, that in
the event of a Proposed Transfer which shall not be in compliance with
Article II hereof, Raytech shall pay all reasonable attorneys' fees
incurred by the Shareholder Representative in enforcing the rights of
the Public Shareholders under Article II hereof, provided that such
fees shall not exceed $50,000. Notwithstanding the foregoing, in
addition, in the event that the Shareholder Representative is required
to enforce the rights of the Public Shareholders under Article II
hereof by the filing of an action or otherwise, then the Shareholder
Representative may recover all reasonable expenses, including
attorneys' fees and costs, from the PI Trust in the event that the
Shareholder Representative obtains a final order that is not the
subject of an appeal determining that a Proposed Tender is not in
compliance with Article II hereof. Any dispute over the reasonableness
of any fees incurred by the Shareholder Representative shall be
resolved by mandatory arbitration.
ARTICLE VII
RESIGNATION OF SHAREHOLDER REPRESENTATIVE
7.01 Resignation. The Shareholder Representative may resign and
be discharged from any future obligations and liabilities hereunder by
giving written notice thereof to the Board of Directors of Raytech and
the Trustees of the PI Trust at least 30 days prior to the effective
date of such resignation. Such resignation shall become effective on
the day specified in such notice.
7.02 Appointment of a Successor Shareholder Representative. If,
at any time, the Shareholder Representative shall give notice of his
intent to resign or shall become incapable of acting as determined by
a court of competent jurisdiction, the United States Bankruptcy Court
for the District of Connecticut, Bridgeport Division, or such other
court of competent jurisdiction, shall choose, upon notice and a
hearing, a successor Shareholder Representative to act under this
Agreement.
7.03 Acceptance of Appointment by Successor Representative. Any
successor Shareholder Representative appointed hereunder shall execute
an instrument accepting such appointment hereunder in the form
determined by the United States Bankruptcy Court for the District of
Connecticut, Bridgeport Division, or such other court of competent
jurisdiction. Thereupon, such successor Shareholder Representative
shall, without any further act, become vested with all of the rights,
powers, trusts and duties of its predecessor hereunder with like
effect as if originally named herein.
ARTICLE VIII
MISCELLANEOUS
8.01 Severability. Whenever possible, each provision of this
Agreement shall be interpreted in such manner as to be effective and
valid under applicable law, but if any provision of this Agreement or
the application thereof to any party of circumstance shall be
prohibited by or invalid under applicable law, such provision shall be
ineffective to the minimal extent of such prohibition or invalidity
without invalidating the remainder of such provision or the remaining
provisions of this Agreement or the application of such provision to
other parties or circumstances.
8.02 Governing Law. This Agreement shall be construed under the
laws of the State of Connecticut (without regard to Connecticut
conflicts of law principles). By executing this Agreement, the PI
Trust and the Shareholder Representative thereby consents to, and
agrees not to contest, the jurisdiction of any court sitting in
Connecticut to hear any action brought under this Agreement.
8.03 Counterparts. This Agreement may be executed in several
counterparts, each of which when so executed may be deemed to be an
original.
8.04 Successors and Assigns. This Agreement shall be binding
upon and inure to the benefit of the Public Shareholders, the PI Trust
and their respective heirs, executors, Legal Representatives and
permitted assigns.
8.05 Notices. All notices required to be given under the terms
of this Agreement or which any of the parties may desire to give
hereunder shall be in writing and shall be deemed given upon personal
delivery or two (2) days after deposit in the United States mail,
registered or certified, postage prepaid, addressed to the party to be
notified at the following address or at such other address as the
party to be notified may, from time to time in writing, furnish to the
other parties in the manner provided in this Section:
If to the Shareholder Xxxxxx Xxxxxxx
Representative: 0000 00xx Xxxxxx, X.X.
Xxxxxxxxxx, XX 00000
with a copy to: Xxxxxxx X. Xxxxxx
Xxxx, Scholer, Fierman, Xxxx &
Handler
000 X. Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
If to the PI Trust:
with a copy to:
If to Raytech or its
Board of Directors :
with a copy to:
8.06 Headings. The headings, titles and subtitles herein are
inserted for convenience of reference only and are to be ignored in
any construction of the provisions hereof.
8.07 Amendments. No amendments or additions to this Agreement
shall be binding unless in writing and signed by all the parties
hereto.
8.08 Entire Agreement. This Agreement, together with the other
documents and instruments referred to herein, constitutes the entire
agreement of the parties and supersedes all other prior agreements,
oral or written, with respect to the subject matter hereof.
8.9 Computation of Time. Time is of the essence of this
Agreement. In the computation of any period of time provided for in
this Agreement or by law, the day of the act or event from which said
period of time runs shall be excluded and the last day of such period
shall be included, unless it is a Saturday, Sunday or legal holiday,
in which case the period shall be deemed to run until the end of the
next day which is not a Saturday, Sunday or legal holiday.
8.10 Waiver. The waiver by and party hereto of any breach of any
term or condition of this Agreement shall not be deemed to constitute
the waiver of any other breach of the same or any other term or
condition hereof.
IN WITNESS WHEREOF, the parties have executed this Agreement as
of the day and date first mentioned above.
THE RAYTECH CORPORATION
ASBESTOS PERSONAL INJURY
SETTLEMENT TRUST
By:
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Its:
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RAYTECH CORPORATION
By:
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Its:
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Xxxxxx Xxxxxxx, not individually,
but solely as the Shareholder
Representative
