Exhibit 10.13
AGREEMENT OF SHAREHOLDERS
THIS AGREEMENT OF SHAREHOLDERS is made this 12th day of November, 1992, by
and among Xxxxxx X. Xxxxx, a resident of the State of New York ("E. Stack"),
Xxxxxxx X. Xxxxx, a resident of the state of Florida ("R. Stack") and Dick's
Clothing & Sporting Goods, Inc., a New York corporation (the "Company").
W I T N E S S E T H:
WHEREAS, E. Stack and R. Stack currently are holders of Common Stock of the
Company; and
WHEREAS, R. Stack is acquiring from E. Stack simultaneously herewith two
hundred ninety thousand shares of Series B Convertible Preferred Stock (the
"Series B Preferred Stock") of the Company pursuant to a Stock Purchase
Agreement (the "Purchase Agreement") of even date herewith; and
WHEREAS, E. Stack is an officer, employee and member of the Board of
Directors of the Company and fully knowledgeable about the Company and its
business and affairs; and
WHEREAS, E. Stack and R. Stack have also executed and delivered a
Stockholders' Agreement (the "Stockholders Agreement") of even date herewith
among E. Stack, R. Stack, the Company and the other holders of capital stock of
the Company; and
NOW, THEREFORE, in consideration of the sale by E. Stack to R. Stack of the
Series B Preferred Stock, and in consideration of the mutual covenants herein
contained and other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the Company, E. Stack and R. Stack agree as
follows:
1. IRREVOCABLE PROXY. R. Stack hereby grants to E. Stack an irrevocable
proxy in the form attached hereto as Exhibit 1 in respect of all shares of
capital stock of the Company owned by R. Stack, whether now owned or hereafter
acquired by R. Stack. R. Stack hereby agrees that he will, as and when necessary
or advisable, execute and deliver such additional irrevocable proxies or other
documents as requested by E. Stack from time to time during the term of this
Agreement to ensure that E. Stack is fully and completely authorized to act as
proxy for R. Stack for all matters in respect of all shares of capital stock of
the Company held by R. Stack. R. Stack hereby represents and warrants that as of
the date of this Agreement he is the owner of two hundred fifty thousand
(250,000) shares of Common Stock of the Company and two hundred ninety thousand
(290,000) shares of Series B Preferred Stock, inclusive of the shares being
acquired pursuant to the Purchase Agreement.
The irrevocable proxy granted to E. Stack hereunder shall be effective until
terminated in writing by E. Stack, PROVIDED, that in the event R. Stack desires
to sell common stock of the Company (subject to the limitation on sale set forth
in Section 2.1 of this Agreement) to a bonafide unaffiliated purchaser after
there has been a public offering of the Company's common stock, E. Stack will
agree to terminate the irrevocable proxy only as to the shares of common stock
that are sold to such bonafide unaffiliated purchaser.
[The rest of this page 1A has been left intentionally blank.]
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2. OPTION.
2.1 GRANT. R. Stack hereby grants to E. Stack an option (the "Option") to
purchase one hundred forty five thousand (145,00) shares of Common Stock of the
Company owned by R. Stack, for the exercise price and on the other terms set
forth in this Section 2. R. Stack covenants and agrees that he shall at all
times maintain ownership of sufficient shares of Common Stock of the Company in
order to satisfy any exercise of the Option, such shares to be free and clear of
all liens, claims and encumbrances except those hereunder and under the
Stockholders' Agreement.
2.2 TIME OF EXERCISE; TERM. The Option shall be exercisable by E. Stack in
whole or in part at any time after the completion of a public offering of shares
of Common Stock of the Company. The Option shall be irrevocable and shall not
terminate unless and until the earlier of (a) the tenth anniversary of the date
of this Agreement or (b) E. Stack agrees in writing to a termination of the
Option. Upon any partial exercise of the Option, the Option shall remain
outstanding for all remaining shares as to which it has not been exercised.
2.3 EXERCISE PRICE. Subject to any adjustment required by Section 2.6 of
this Agreement, the exercise price of the Option for each share of Common Stock
covered thereby shall be equal to seventy five percent (75%) of the per share
Market Price (as hereinafter defined) of the Common Stock of the Company on the
date the Option is exercised. For purposes of this Agreement, the Market Price
of the Common Stock of the Company shall be deemed to be the mean between the
high and low prices of the Common Stock on the national securities exchange on
the day on which the Option is exercised, if the Common Stock is then being
traded on a national securities exchange, and if the Common Stock is then being
traded on such an exchange but there are no sales on such day, the Market Price
shall be deemed to be the mean between the high and low prices of the Common
Stock on the national securities exchange on the day on which the most recent
sales occurred prior to the date of exercise; and if the Common Stock is not
then traded on such an exchange, then the Market Price shall be deemed to be the
mean between the high and low bid and asked prices for the Common Stock on the
over-the-counter market on the day on which the Option is exercised.
2.4 MANNER OF EXERCISE. E. Stack shall exercise the Option, as to all or a
portion of the shares covered thereby, by providing written notice of exercise
to R. Stack. The notice of exercise shall be signed by E. Stack and shall
specify the number of shares to be purchased and the exercise price to be paid
therefor, and shall be accompanied by the payment of the exercise price for the
shares as to which the Option is then being exercised. The exercise price must
be payable in United States dollars and may be paid by check or wire transfer
payable to R. Stack. Upon notice of exercise and payment of the exercise
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price, R. Stack shall deliver to E. Stack a stock certificate or certificates
representing the number of shares of Common Stock as to which the Option has
been exercised, duly endorsed for transfer to E. Stack or accompanied by
executed stock powers reflecting transfer to E. Stack, in each case with his
signature(s) guaranteed. All such shares shall be free and clear of all liens,
claims and encumbrances except those imposed by this Agreement.
2.5 TRANSFERABILITY. The Option granted hereby shall not be assignable or
transferable by E. Stack except that upon his death the Option shall be
transferable to the executors or administrators of his estate or any person or
persons who shall have acquired the right to exercise the Option by bequest or
inheritance. Transferability of shares of Common Stock issued upon the exercise
of the Option shall not be restricted by this Agreement.
2.6 ADJUSTMENTS FOR CERTAIN TRANSACTIONS.
(a) In case the Company shall (i) declare a dividend on outstanding
shares of its Common Stock in shares of its Common Stock, (ii) subdivide
outstanding shares of Common Stock, (iii) combine outstanding shares of Common
Stock into a smaller number of such shares, (iv) issue by reclassification of
shares of Common Stock (including any such reclassification in connection with a
consolidation or merger in which the Company is the continuing corporation) any
shares of any class of stock, or (v) distribute any other property (other than
cash) as a distribution or dividend on or in exchange for shares of Common Stock
(including any such distribution in connection with a consolidation, merger,
sale of assets or liquidation), the number of shares of Common Stock or other
consideration for which the Option may be exercised at the time of the record
date for such dividend or the effective date of such subdivision, combination or
reclassification (the "Determination Date") shall be proportionately adjusted in
such manner that the number of shares of Common Stock for which E. Stack has an
Option shall be equal to the number of shares or other consideration that he
would be entitled to receive if the Option (or any unexercised portion thereof)
had been exercised immediately prior to the Determination Date.
(b) In the event the Company takes any action described in subsections
(a)(i), (ii), (iii), (iv) or (v), above, the Company shall give written notice
of such action to E. Stack at least thirty (30) days prior to the action. Upon
any such action, the exercise price shall be increased or decreased, as the case
may be, such that the exercise price is equal to (i) the aggregate exercise
price less any amounts paid to R. Stack upon the partial exercise of the Option
prior to the Determination Date, (ii) divided by the number of shares of Common
Stock for which the Option may be exercised after the adjustment described in
subsection (a) above is made.
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3. TERMINATION. This Agreement, and the respective rights and obligations
of the parties hereto, shall terminate only upon a written agreement of
termination executed by all parties hereto.
4. NOTICES. All notices and other communications hereunder shall be in
writing and shall be delivered to each party as follows:
if to E. Stack to:
000 Xxxxxxxxx Xxxxx
Xxxxxx, Xxx Xxxx 00000
if to R. Stack to:
15218 00xx Xxx X.
Xxxx Xxxxx Xxxxxxx, Xxxxxxx 00000
if to the Company to:
Dick's Clothing & Sporting Goods, Inc.
Corporate Xxxx Xxxxx
XX0, Xxx 00-X
Xxxxxxx, Xxx Xxxx 13748
or to such other address as any party may specify in writing to other parties.
All such notices and other communications shall be effective after delivery to
the address specified.
5. SPECIFIC PERFORMANCE. The rights of the parties under this Agreement are
unique and, accordingly, the parties shall, in addition to such other remedies
as may be available to any of them at law or in equity, have the right to
enforce their rights hereunder by actions for specific performance to the extent
permitted by law.
6. LEGEND. The certificates representing all shares of capital stock of the
Company owned by R. Stack shall bear on their face a legend indicating the
existence of the restrictions imposed hereby.
7. ENTIRE AGREEMENT. This Agreement constitutes the entire agreement among
the parties with respect to the subject matter hereof and supersedes all prior
agreements and understandings between them or any of them as to such subject
matter.
8. WAIVERS AND FURTHER AGREEMENTS. Any waiver by any party of a breach of
any provision of this Agreement shall not operate or be construed as a waiver of
any subsequent breach of that provision or of any other provision hereof. Each
of the parties hereto agrees to execute all such further instruments and
documents and to take all such further action as any other party
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may reasonably require in order to effectuate the terms and purposes of this
Agreement.
9. ASSIGNMENT; SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon
and shall inure to the benefit of the parties hereto and their respective heirs,
executors, legal representatives, successors and permitted transferees,
PROVIDED, HOWEVER, that except as specifically provided herein, this Agreement
shall not be assignable by any party without the written consent of the other
parties hereto.
10. SEVERABILITY. In case any one or more of the provisions contained in
this Agreement shall for any reason be held to be invalid, illegal or
unenforceable in any respect, such invalidity, illegality or unenforceability
shall not affect any other provision of this Agreement and such invalid, illegal
and unenforceable provision shall be reformed and construed so that it will be
valid, legal, and enforceable to the maximum extent permitted by law.
11. COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
12. SECTION HEADINGS. The headings contained in this Agreement are for
reference purposes only and shall not in any way affect the meaning or
interpretation of this Agreement.
13. GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York.
IN WITNESS WHEREOF, the undersigned have executed this Agreement as a
sealed instrument as of the day and year first above written.
DICK'S CLOTHING AND SPORTING GOODS, INC.
By:/s/
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President
/s/ Xxxxxx X. Xxxxx
-------------------------------
XXXXXX X. XXXXX
/s/ Xxxxxxx X. Xxxxx
-------------------------------
XXXXXXX X. XXXXX
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EXHIBIT 1
IRREVOCABLE PROXY
-----------------
KNOW ALL MEN BY THESE PRESENTS that the undersigned does hereby make,
constitute and appoint XXXXXX X. XXXXX his true and lawful attorney, for him and
in his name, place and xxxxx, to act as his proxy in respect of all of the
shares of capital stock of Dick's Clothing & Sporting Goods, Inc., a New York
corporation (hereinafter referred to as the "Corporation"), which he now or
hereafter may own or hold, including, without limitation, the right, on his
behalf, to demand the call by any proper officer of the Corporation pursuant to
the provisions of its Certificate of Incorporation or By-Laws and as permitted
by law of a meeting of its shareholders and at any such meeting of shareholders,
annual, general or special, to vote for the transaction of any and all business
that may come before such meeting, or any adjournment thereof, including,
without limitation, the right to vote for the sale of all or any part of the
assets of the Corporation and/or the liquidation and dissolution of the
Corporation; giving and granting to his said attorney full power and authority
to do and perform each and every act and thing whether necessary or desirable to
be done in and about the premises, as fully as he might or could do if
personally present with full power of substitution, appointment and revocation,
hereby ratifying and confirming all that his said attorney shall do or cause to
be done by virtue hereof.
This Proxy is given to XXXXXX X. XXXXX pursuant to the Agreement of
Shareholders of even date herewith by and among Xxxxxx X. Xxxxx, Xxxxxxx X.
Xxxxx and the Corporation, and this Proxy shall not be revocable or revoked by
the undersigned, shall be binding upon his heirs, administrators, successors and
assigns until such Agreement of Shareholders is terminated as provided therein.
This Proxy shall survive so long as such Agreement of Shareholders is in effect.
IN WITNESS WHEREOF, the undersigned has executed this Irrevocable Proxy
this ___ day of November, 1992.
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XXXXXXX X. XXXXX
STATE OF )
) ss:
COUNTY OF )
On November ___, 1992 before me personally came Xxxxxxx X. Xxxxx to me
known, and known to me to be the individual described in, and who executed the
foregoing IRREVOCABLE PROXY, and duly acknowledged to me that he executed the
same.
________________________________________
Notary Public
EXHIBIT 2
RELEASE
To all whom these presents shall come or may concern, know that Xxxxxxx X.
Xxxxx, residing at 00000 00xx Xxx X., Xxxx Xxxxx Xxxxxxx, Xxxxxxx, as RELEASOR,
in consideration of the sum of one ($1) dollar and all other good and valuable
consideration received from Dick's Clothing & Sporting Goods, Inc. (the
"Company"), and Xxxxxx X. Xxxxx, individually and as an officer, director and
shareholder of the Company, as RELEASEES, receipt and sufficiency of which are
hereby acknowledged, releases and discharges each RELEASEE, jointly and
severally, and each RELEASEE's officers, directors, shareholders, employees,
investors, agents, affiliates, administrators, heirs, successors and assigns,
individually and as representatives of RELEASEES, from all actions, causes of
action, suits, debts, dues, sums of money, accounts, reckonings, bonds, bills,
specialties, covenants, contracts, controversies, agreements, promises,
variances, trespasses, damages, judgments, extents, executions, claims, and
demands whatsoever, in law, admiralty or equity (hereinafter "ACTIONS"), which
against each RELEASEE, jointly or severally, the RELEASOR, RELEASOR'S, agents,
affiliates, administrators, successors or assigns ever had, now have or
hereafter can, shall or may, have, individually or as representatives of
RELEASOR, for, upon, or by reason of any matter, cause or thing, including
without limitation all ACTIONS arising out of the operation, management,
restructuring, recapitalization or issuance of capital stock of the Company,
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from the beginning of the world to the day of the date of this RELEASE; except
for (a) ACTIONS under the Agreement of Shareholders dated as of November 11,
1992 among RELEASOR and RELEASEES, and (b) ACTIONS under the Stockholder's
Agreement dated as of November 11, 1992 among RELEASOR, RELEASEES, and the other
shareholders of the Company.
This RELEASE may not be changed orally.
IN WITNESS WHEREOF, the RELEASOR has hereunto set RELEASOR'S hand and seal
on November __, 1992.
In Presence of
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XXXXXXX XXXXX
STATE OF )
) SS.
COUNTY OF )
On November __, 1992, before me personally came Xxxxxxx X. Xxxxx to me
known to be the individual described in, and who executed the foregoing RELEASE,
and duly acknowledged to me that he executed the same.
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Notary Republic
EXHIBIT 3
SHAREHOLDER CERTIFICATE
The undersigned, Xxxxxxx X. Xxxxx, a shareholder of Dick's Clothing &
Sporting Goods, Inc., a New York corporation (the "Company"), does hereby
certify as follows:
1. I have reviewed and understand the proposed transaction involving the
Company pursuant to which the capital structure of the Company will be changed,
the rights and preferences of outstanding stock will be changed, additional
preferred stock that is convertible to common stock will be issued to certain
new investors, and a stockholders' agreement restricting my ability to transfer
my stock will be signed. I understand that this transaction will dilute my
interest in the Company and that certain rights that I may presently have,
including pre-emptive rights under New York law, will be eliminated.
2. I have been represented by counsel that I believe to be competent in
connection with the proposed transaction.
3. I have read the following documents relating to this transaction:
(a) Series A Preferred Stock Purchase Agreement and the Schedules to
the Purchase Agreement;
(b) Stockholders Agreement;
(c) Registration Rights Agreement;
(d) Restatement of Certification of Incorporation;
(e) Stock Purchase Agreement;
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(f) Unanimous Consent of Shareholders and related Resolutions;
(g) Termination of Stock Purchase Agreement;
(h) Agreement of Shareholders;
(i) Release; and
(j) Irrevocable Proxy.
All of the foregoing documents have been explained to me by my counsel and I
understand their effect on me and my ownership in the Company. My attorney and
I have been provided with the opportunity to speak with and ask questions of
the officers, directors and other shareholders of the Company, and the
Company's counsel, and to review documents and information regarding the
Company and the proposed transaction. To the extent questions have been asked
or documents or information requested they have been answered or provided to my
satisfaction and to the satisfaction of my attorney.
4. I have given careful consideration of the proposed transaction and have
decided to vote in favor of and to consummate the proposed transaction based
upon my personal review and investigation of the Company and the transaction and
upon the advice of my counsel. I am not relying on any representations, promises
or agreements of any other person except to the extent any representations,
promises or agreements are specifically set forth in one of the documents
described above.
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5. I believe the proposed transaction is in my best interest as a
shareholder of the Company.
Executed this ________ of November, 1992.
___________________________________
XXXXXXX X. XXXXX
STATE OF )
) ss:
COUNTY OF )
On November ___, 1992 before me personally came Xxxxxxx X. Xxxxx to me
known, and known to me to be the individual described in, and who executed the
foregoing SHAREHOLDER CERTIFICATE, and duly acknowledged to me that he executed
the same.
___________________________________
Notary Public
