EXHIBIT
10.3
SHAREHOLDERS AGREEMENT
BETWEEN:
- SONEPAR ELECTRONIQUE INTERNATIONAL (SEI), a French limited liability
company with its registered office at 0, xxx xx xx Xxxx xxx Xxxxx (00000)
XXXXXX, represented by Xxxx XXXXXXXX, in this duly authorized by, a
Management Board Resolution passed on June 26th, 1997
and
- SEI INVESTMENTS BV, a Dutch company having its registered office at 0,
Xxxxxxxxxxxx XXXXX (XXX XXXXXXXXXXX), represented by Xxxx XXXXXXXXXX, in
this duly authorized by, a Shareholders Resolution passed on July 9th, 1997
and
- XXXXXXXX INDUSTRIES (MI or XXXXXXXX), a California corporation having its
registered office at 0000 Xxxxxxx Xxxxxx, Xx Xxxxx, Xxxxxxxxxx 00000,
U.S.A., represented by Xxxxx XXXX, in this duly authorized by, the Board
Minutes of August 25th, 1994
and
- XXXXXXXX INDUSTRIES INVESTMENTS BV (Xxxxxxxx Subsidiary), a Dutch company
having its registered office at C/O Holland Intertrust Corporation BV,
Xxxxxxxxxxx 00, 0000 XX Xxxxxxxxx (Xxx Xxxxxxxxxxx), represented
by Xxxxx Xxxx.
Whereas
- SEI holds the entire issued capital of SEI Management BV which company
in its turn holds the entire issued share capital of SEI Investments
BV, both companies being private companies with limited liability,
established under the laws of the Netherlands.
- EUROTRONICS BV, a private company with limited liability, established
under the laws of the Netherlands (hereinafter "the Company") with
several subsidiaries as described per Appendix 1 is a wholly
controlled subsidiary of SEI Investments BV.
- SEI. SEI Management BV, SEI Investments BV, the Company and the
Company's subsidiaries form a group of companies ("group") as
defined in article 2:24(b) of the Dutch Civil Code (aforementioned
companies as such individually "Sonepar Group-company" and
collectively "Sonepar Group-companies).
- MI holds the entire issued capital of Xxxxxxxx Subsidiary.
- In 1994, SEI and MI, hereafter referred to as "the Parties" agreed
to form a strategic alliance between them with the purpose to improve
operation of their electronic distribution businesses respectively
located for MI in the USA and for SEI in Europe and in particular to
serve the fast and strong globalization process in this industry.
- In the meantime the parties have strengthened their links throughout:
a EDP common task forces and investigations
b Franchise mutual support
c I.T. development especially on Internet
d Inventory management skill exchanges
e Mutual participation at their Boards
f Regular meetings between their CEO's
g Joint Executive video-conference
- In the past three years each Party has led its own development in full
agreement and understanding of the other, such as further strategic
alliances with WYLE for XXXXXXXX or with JAKOB HATTELAND ELECTRONIC
for SEI.
- The Parties have agreed to achieve a capital association to be
implemented through the Company as their joint venture company, where
XXXXXXXX will hold a minority stake.
- The Parties hereto have accordingly resolved to enter into this
agreement (hereinafter : "this/the Agreement") on the terms
hereinafter set forth to establish further specific rules and rights
under which they want to bind their capital association, in complement
to the articles of association of the Company.
It is hereby agreed as follows:
Article 1 - EUROTRONICS B.V.
1.1 SEI, as the ultimate beneficiary of the Company, commits itself to cause
its group company SEI INVESTMENTS B.V.;
(a) to enter into an agreement with XXXXXXXX regarding the contribution to
be made by XXXXXXXX Subsidiary of its 99.5% shareholding in EUROTRONICS SAS,
a limited liability company established under the laws of France, having its
registered seat at 2, rue de la Tour des Dames (75009) PARIS (considered
after conversion by XXXXXXXX INDUSTRIES of its loan in EUROTRONICS SAS) in
the capital of the Company (the "Contribution") in consideration of the
BV-shares as defined hereunder issued to XXXXXXXX Subsidiary. The terms and
conditions of the Contribution shall be integrated in the deed of share issue
as referred to in Article 2 below.
(b) to adopt in its capacity of sole shareholder of the Company a
resolution:
(i) to issue 28,800 common shares with a par value of NLG 1,000 (in words
one thousand Dutch Guilders) each in the capital of the Company ("BV-Shares")
to XXXXXXXX Subsidiary, with the exclusion of any pre-emptive rights of SEI
INVESTMENTS BV or any other SONEPAR Group-company or third party:
(ii) to appoint Xx. Xxxxxx XXXXX and Mr. Xxxxxx XXXXXXXX to the Supervisory
Board of the Company as per the Completion Date (as defined in article 2 of
this Agreement), such appointment being made to give effect to the provisions
of article 3.1 of this Agreement.
1.2 A copy of the articles of association of the Company as presently in
force, the draft of the aforementioned shareholders resolution and the draft
of the notarial deed of share issue as referred to in article 2 below are
attached as Appendixes 2, 3 and 4 respectively.
Article 2 - SHARE ISSUE EUROTRONICS BV
As soon as practicable after the formation of XXXXXXXX Subsidiary, or any
other date to be agreed to by XXXXXXXX, SEI and the Company (the "Completion
Date"), Xxxxxxxx Subsidiary and the Company will appear before the Civil Law
Notary Xxxxx X. XXXX, practising in Rotterdam, or his substitute to execute a
notarial deed whereby the Company shall issue new BV-shares to XXXXXXXX
Subsidiary (The Completion"). The BV-shares shall represent 16% of the total
issued share capital of the Company.
Article 3 - MANAGEMENT OF THE COMPANY
3.1 The management of the business and affairs of the Company will be
supervised by a Board of Supervisory Directors (Raad van Commissarissen)
("Supervisory Board") that the shareholders shall cause to be composed of a
minimum of five Supervisory Directors. Notwithstanding paragraph 7 of
Article 14 of the Articles of the Company during the term of this Agreement
the shareholders shall cause the Supervisory Board to be constituted as
follows:
a) two members of the Supervisory Board shall be appointed, dismissed and
suspended by the General Meeting upon binding nomination for appointment,
dismissal, or suspension by XXXXXXXX Subsidiary. The first two members to be
so nominated by XXXXXXXX Subsidiary will be Xxxxxx Xxxxx and Xxxxxx Xxxxxxxx.
b) all rights and provisions for members of the Supervisory Board granted to
existing members, excluding the Chairman of the Supervisory Board, shall
apply to the members nominated by Xxxxxxxx Subsidiary.
c) each Party shall ensure that the General Meeting shall vote in favour of
the appointment of the candidates nominated in accordance with this clause as
members of the Supervisory Board.
d) each vacancy in the Supervisory Board by a member appointed pursuant to
paragraph (a) above shall upon request of either the Supervisory Board or the
General Meeting be filled by appointment by the General Meeting of a
candidate, nominated by XXXXXXXX Subsidiary.
3.2 The Shareholders will, in accordance with the articles, appoint the
single Managing Board member who will be entrusted as the Chief Executive
Officer of the Company with all powers to run the business subject to the
restricted operations requiring either Supervisory Board or Shareholders
prior consent.
Article 4 - VETO RIGHT
SEI and MI intend to give the representatives of XXXXXXXX Subsidiary
participating in the Supervisory Board of the Company a veto right with
regard to certain matters. Therefore, it has been provided in article 14,
paragraph 4 juncto paragraph 7 of the articles of association of the Company
that the unanimous approval of the Supervisory Board - of which pursuant to
the provisions of this agreement the nominees of XXXXXXXX Subsidiary are
members -will be required for resolutions relating to those matters set forth
in such Article 14. Thus, all matters described in paragraph 4 of article 14
of the Articles of Association of the Company that require the prior approval
of the Board of Supervisory Directors shall only be passed if such approval
is granted by the Board of Supervisory Board by a unanimous vote with the two
XXXXXXXX Subsidiary appointees to the Board voting in favour of such action.
Article 5 - BASIC FINANCIAL INFORMATION
SEI or SEI Investments shall, or shall cause the Company, to provide to
XXXXXXXX reports on and copies of the audited yearly financial statements of
all the SEI Group companies and of both the quarterly and yearly combined non
audited statements by country.
Article 6 - RIGHT OF 1ST REFUSAL
6.1 The articles of the Company contain a right of first refusal provision
which states the Dutch corporate law procedures in this matter. However, the
parties' will goes beyond the Dutch corporate law constraints as far as right
of first refusal is concerned, as set forth in this Article 8.
6.2 The parties agree that if a shareholder wishes to transfer any or all
of its shares in the Company to a third party (where none of the conditions
set forth in paragraph 16 of Article 12 of the Articles of the Company apply
to such shareholder), that shareholder wishing to transfer its shares shall
waive its right under paragraph 8 of Article 12 of the Articles of the
Company to require that the price of the allotted shares be determined by the
experts and accordingly, the price of the allotted shares shall be the price
mentioned in paragraph 2 of Article 12 of the Articles of the Company.
6.3 The parties agree that if there are purchasers for shares being
offered, the parties shall cause the Board of Managing Directors to make the
allotment pursuant to paragraph 5 of Article 12 of the Articles of the
Company within seven days after all of the shareholders who have the right to
purchase have notified the Board of Managing Directors whether they exercise
their right of purchase rather than within seven days of the expiry of the
allotment term.
6.4 The parties agree that the transfer of shares to purchasers and
simultaneous payment of the purchase price as provided in paragraph 13 of
Article 12 of the Articles of the Company shall be made within seven days of
the expiry of the term within which the transferor could withdraw his offer
rather than within thirty days of such date. If any of the events set forth
in Paragraph 16 of Article 12 of the Articles of the Company occurs with
respect to any direct or indirect parent company of a shareholder, the
provisions of Article 12 of the Articles of the Company shall apply fully as
though such event occurred with respect to such shareholder, thereby giving
the other shareholders the right of first refusal described in such Article
12.
6.5 Where the application term of 180 days is reduced to 60 days if less
than a fourth of the nominal issued capital is offered as provided in
paragraph 4 of Article 12 of the Articles of the Company, there shall be a
minimum term of six months between each enforcement of such provision.
6.6 Where shares become available after initial allotment because a
shareholder fails to exercise its right of purchase pursuant to paragraph 11
of Article 12 of the Articles of the Company, and as a result, paragraphs 3
up to and including 7 of Article 12 of the Articles of the Company apply
mutatis mutandis with respect to the shares that have become available, a
determination of the price shall not take place again and the initial
application term period in which to respond with respect to such additional
shares that have become available shall be 30 days rather than 180 days.
6.7 Notwithstanding the right of first refusal provisions set forth in the
Articles of the Company, SEI Investments BV and XXXXXXXX Subsidiary shall be
entitled to sell and transfer its shares in the Company to any other company
or entity wholly controlled by it and the other party shall in applying the
preemptive right contained in the articles of association of the Company
fully cooperate in effecting such sale and transfer.
Such sale and transfer would be on the conditions precedent that:
- the transferee shall purchase and accept all shares held by the transferor.
- the transferee accedes to this agreement, assumes from the transferor any
and all obligations arising in connection with this agreement; and
- the transferor fully guarantees the timely complete and correct performance by
the transferee of any and all obligations arising in connection with this
agreement.
6.8 If the Company desires to sell any of its shares in the SEI-Group
companies listed in appendix 1 or any additional companies acquired in the
electronic business in Europe, it shall give written notice to XXXXXXXX of
its intention as described in article 12 of the articles of association of
the Company and Xxxxxxxx shall have such right of first refusal as described
in said article except for the application term mentioned in Article 12.4
which will be reduced to 45 days in both cases.
6.9 No transfers of shares of intermediate holding companies of the
Company may be made by either party which circumvent the rights of first
refusal set forth in the Articles of the Company and this Shareholders
Agreement. In furtherance thereof: (a) at all times during which any company
or entity controlled by SEI is the owner of shares of the Company (including
but not limited to SEI Investments BV), one hundred percent (100%) of the
equity interest of such company or entity shall be owned by SEI or its direct
or indirect wholly-owned subsidiaries: and (b) at all times during which a
company or entity controlled by MI (including but not limited to XXXXXXXX
Subsidiary) is the owner of shares of the Company, one hundred percent (100%)
of the equity interest of such company or entity shall be owned by XXXXXXXX
or its direct or indirect wholly-owned subsidiaries.
Article 7 - BUYOUT PROPOSAL
At any time after two (2) years from the Completion Date, XXXXXXXX shall have
the option of making an offer to purchase the remaining shares of the Company
that it does not own from SEI INVESTMENTS BV or any SEI-Group company to
which such shares may have been transferred according to this Agreement. SEI
shall have up to six (6) months from the date of this offer to either accept
or reject the offer for and on behalf of such entity or entities. If the
offer is not accepted by SEI, then SEI must purchase the Company's shares
owned by XXXXXXXX Subsidiary or any of its affiliates to which such shares
may have been transferred according to this Agreement, at the price offered
by XXXXXXXX or cause such purchase to be made by the appropriate SEI-Group
company.
Article 8 - XXXXXXXX STOCK OPTION
Concurrently with Completion Date: (a) XXXXXXXX will grant SEI INVESTMENTS
B.V. an option to purchase XXXXXXXX common stock in the form evidenced in
Exhibit 5; and (b) SEI shall assign and transfer all of its right, title and
interest in and to the Registration Rights Agreement dated as of September
15, 1994 between MI and SEI to SEI INVESTMENTS BV and MI will execute all
necessary documents to affect the option under a Registration Rights
Agreement. Such Registration Rights Agreement shall not be assignable or
transferable by SEI Investments BV.
Article 9 - GOOD FAITH
The parties hereto agree that they shall use their best efforts and take all
such steps as may reasonably be within their power, so as to cause the
Company to comply with and act in a manner specified by the provisions of
this Agreement: and so as to implement the provisions of this Agreement to
the full extent permitted by laws and shall cause its respective nominees as
members of the Supervisory Board of the Company to act accordingly. In
entering into this Agreement, the parties hereto recognise that it is
impracticable to make provisions for every contingency that may arise in the
course of performance hereof. Accordingly, the parties hereby declare it to
be their intention that this Agreement shall operate between them with
fairness and without detriment to the interests of either of them, and if in
the course of the performance of this Agreement unfairness to either party is
disclosed or anticipated then the parties hereto shall use their best efforts
to agree upon such action as may be necessary and equitable to remove the
cause or causes of the same.
Article 10 - EXCLUSIVITY / NON COMPETITION
Except through the Company, XXXXXXXX agrees that it shall not own or
establish a company or business based in Europe that competes with SEI-Group
companies in the electronics distribution business: provided however, that
XXXXXXXX may own or establish businesses to provide service, product and/or
logistical support in Europe due to customer or vendor requirements that SEI
cannot provide.
SEI agrees that it shall not own, invest in, conduct or otherwise be
associated with any electronics distribution business in Europe other than
through the Company. Except through XXXXXXXX, SEI agrees that it shall not
own or establish a company or business based in North America that competes
with XXXXXXXX in the electronics distribution business; provided however,
that SEI may own or establish business to provide service, product and/or
logistical support in North America due to customer or vendor requirements
that XXXXXXXX cannot provide.
Article 11 - TERMINATION OF AGREEMENT
This Agreement shall be terminated upon the occurrence of one of the
following events:
(i) a written agreement of XXXXXXXX and SEI
(ii) at such times as:
a. none of XXXXXXXX or any of its wholly-owned subsidiaries is a
shareholder of the Company or,
b. none of SEI or any of its wholly-owned subsidiaries is a shareholder of
the Company.
Article 12 - NOTICES
Any notice or other communication required or permitted to be given under
this Agreement shall be in writing and signed by or on behalf of the party
giving notice and shall be given either personally, by overnight courier
service, by facsimile transmission or by registered or certified mail, return
receipt requested, first-class postage prepaid, or by other means of written
communication, addressed to such other party at the address appearing below.
A notice to a party delivered other than by mail shall be deemed to have been
given at the time it is actually received by the part to whom notice is given.
All notices are to be sent as follows:
if to XXXXXXXX or XXXXXXXX Subsidiary: to the attention of Xx. Xxxxxx XXXXX
c/x XXXXXXXX INDUSTRIES (MI), 0000 Xxxxxxx Xxxxxx, Xx Xxxxx, Xxxxxxxxxx
00000, X.X.X.
With a copy to : D. Xxxxxxx Xxxxxx, O'Melveny & Xxxxx, 000 Xxxxx Xxxx Xxxxxx,
Xxx Xxxxxxx, Xxxxxxxxxx 00000, U.S.A.,
If to SEI : to the attention of Monsieur Xxxx XXXXXXXX c/o SONEPAR
ELECTRONIQUE INTERNATIONAL (SEI), 2. xxx xx xx Xxxx xxx Xxxxx (00000) FRANCE.
If to SEI INVESTMENTS BV : to the attention of Xx Xxxx XXXXXXXX x/x XXX
XXXXXXXXXXX XX, 0. Takkebisters BREDA (THE NETHERLANDS).
With a copy to : Xx Xxxxxx PEN, Coopers & Xxxxxxx, Xxxxxx Xxxxxxx 00, XX Xxx
0000, 0000 XX Xxxxxxxxx, XXX XXXXXXXXXXX.
Article 13 - FURTHER ASSURANCES
The parties hereto shall execute any additional documents or amendments to
documents and shall take any further actions that may be necessary to carry
out the terms of this Agreement. If there is any conflict between any
provision of this Agreement and any such document, including those attached
in Exhibits hereto, the provisions of this Agreement shall prevail.
Article 14 - COUNTERPARTS
This Agreement may be executed in one or more counterparts, and when executed
by each of the parties signatory hereto, said counterparts shall constitute a
single valid agreement through each of the signatory parties may have
executed separate counterpart hereof.
Article 15 - SUCCESSORS
This Agreement is binding upon and shall insure to the benefit of the parties
hereto and to their respective successors, assigns, personal representatives,
heirs and legatees.
Article 16 - GOVERNING LAW
This agreement is made under and shall be construed pursuant to the laws of
the Netherlands.
Article 17 - INTEGRATION
17.1 This Agreement together with all appendixes as enunciated along the
above articles sets forth the entire understandings of the parties with
respect to the subject matter hereof and supersedes all prior or
contemporaneous agreements of the parties whether oral or written with
respect to the subject matter hereof.
The parties understand and agree that the subject matter hereof does not
relate to prior agreements solely between XXXXXXXX and SEI which relate to
matters other than corporate governance and action by shareholders of
Eurotronics BV.
17.2 In the event of any discrepancy, between the provisions of this
agreement and those of the articles of association of the Company, the former
shall prevail.
Article 18 - EUROTRONICS S.A.S.
Without MARSHALL's prior written consent, SEI will not, and will not permit
any of its affiliates, to liquidate or otherwise dispose of the shares of
EUROTRONICS SAS or any of the assets of EUROTRONICS SAS for at least 10 years
from the Completion Date, except that EUROTRONICS SAS may dispose of shares
of Bloomers Electronics Ltd. and/or SEI Electronics Purchasing GmbH.
Article 19 - SUBSEQUENT SHAREHOLDERS AGREEMENT
If either shareholder offers its shares to the other shareholder pursuant to
any of the right of first refusal provisions of the Articles of Association
of the Company, as amended by this Shareholders Agreement, and the
shareholder(s) having the right of first refusal elects not to exercise their
right of first refusal, the transfer of the shares by the offering
shareholder to the third party (the "Transferee") shall be on the condition
precedent that the Transferee shall enter into an agreement (the "Subsequent
Shareholders Agreement" ) with the remaining shareholders(s) whereby the
Transferee agrees:
(a) to become a party to and be bound by Sections 6.2, 6.3, 6.4, 6.5, 6.7,
6.8, 6.9 and 6.10 of Article 6 of this Shareholders Agreement and Article 18
of this Shareholders Agreement, mutatis mutandis;
(b) that so long as XXXXXXXX subsidiary or any of its affiliates is a
shareholder of the Company, the transferee shall be bound by the provisions
of Section 3.1 of Article 3 of this Shareholders Agreement;
(c) to be bound by the provisions of Article 10 of this Shareholders
Agreement; provided, however that the part of the second sentence of the
second paragraph that reads "Except through its ownership in XXXXXXXX" shall be
deleted if it is SEI or its affiliate that is transferring the shares; and
(d) that any subsequent transferee to whom the Transferee transfers its
shares in accordance with the Articles of the Company and the Subsequent
Shareholders Agreement shall be bound by the Subsequent Shareholders
Agreement.
Article 20 - INVALID PARTS
If part of this Agreement or any right pursuant to this Agreement is invalid
or unenforceable, this shall not in any way affect the remaining terms or
rights. Parties shall replace the invalid or unenforceable part with valid
provisions containing the same purpose and goal as the replaced part.
Executed in Paris
On September 15, 1997
XXXXXXXX INDUSTRIES SONEPAR ELECTRONIQUE
INTERNATIONAL
/S/ XXXXX XXXX /S/ XXXX XXXXXXXX
-------------------------- -------------------------------
Xxxxx Xxxx Xxxx Xxxxxxxx
Chief Financial Officer President du Directoire
XXXXXXXX INDUSTRIES INVESTMENTS BV SEI INVESTMENTS BV
/S/ XXXXX XXXX /S/ XXXX XXXXXXXXXX
-------------------------- -------------------------------
Xxxxx Xxxx Xxxx Xxxxxxxxxx
Solely authorized managing director Director
LIST OF APPENDIXES
1. List of the direct subsidiaries of EUROTRONICS BV
2. Articles of Association of EUROTRONICS BV
3. Shareholders Resolution
4. Notarial Deed of Share Issue
5. SONEPAR ELECTRONIQUE INTERNATIONAL's option on
XXXXXXXX INDUSTRIES' shares
