EXHIBIT 10.27
FORM OF
SHAREHOLDERS AGREEMENT
FOR
METRETEK, INCORPORATED
DATED AS OF ________, 200__
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TABLE OF CONTENTS
PAGE
SECTION 1. DEFINITIONS.................................................................................4
1.1. Certain Defined Terms..............................................................4
1.2. Certain Other Defined Terms........................................................5
1.3. Other Definitional Provisions......................................................5
SECTION 2. RESTRICTIONS ON TRANSFERS OF EMPLOYEE SHARES................................................6
2.1. General Restrictions on Transfer...................................................6
2.2. Effect of Prohibited Transfer......................................................6
SECTION 3. RIGHT OF FIRST REFUSAL......................................................................6
3.1. Right of First Refusal.............................................................6
3.2. Purchase Price.....................................................................6
3.3. Closing of Right of First Refusal..................................................6
3.4. Sale to Prospective Purchaser......................................................7
3.5. Permitted Transfers................................................................7
3.6. Securities Act Matters.............................................................7
SECTION 4. TAG-ALONG RIGHTS............................................................................8
4.1. Tag-Along Rights...................................................................8
4.2. Tag-Along Notice...................................................................8
4.3. Exercise of Tag-Along Right........................................................8
4.4. Exceptions.........................................................................8
SECTION 5. DRAG-ALONG RIGHT............................................................................8
5.1. Drag-Along Right...................................................................8
5.2. Drag-Along Notice..................................................................8
5.3. Purchase Agreement.................................................................9
SECTION 6. PREEMPTIVE RIGHTS...........................................................................9
6.1 Preemptive Rights for New Securities...............................................9
6.2 Acceptance of Preemptive Offer.....................................................9
6.3 Closing of Exercise of Preemptive Offer............................................9
6.4 Company Sale of Refused Securities.................................................9
6.5 Excepted Securities...............................................................10
SECTION 7. COMPANY'S CALL RIGHT.......................................................................10
7.1. Call Right........................................................................10
7.2. Call Price........................................................................10
7.3. Mechanics of Exercise.............................................................11
7.4. Closing of Call Right.............................................................11
SECTION 8. EFFECTUATION PROVISIONS.....................................................................11
8.1. Enabling Action...................................................................11
8.2. Legend............................................................................11
8.3. Acknowledgement of Necessity of Restrictions......................................12
8.4. Record of Transfers...............................................................12
8.5. Voting of Shares .................................................................12
8.6. No Contrary Action................................................................12
8.7. Company Determinations............................................................12
SECTION 9. TERMINATION OF AGREEMENT....................................................................12
9.1. Termination.......................................................................12
9.2. Effect of Termination.............................................................13
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SECTION 10. ARBITRATION................................................................................13
SECTION 11. GENERAL PROVISIONS.........................................................................13
11.1. Governing Law.....................................................................13
11.2. Amendment.........................................................................13
11.3. Assignment........................................................................13
11.4. Successors and Assigns............................................................13
11.5. Entire Agreement..................................................................13
11.6. Notices...........................................................................13
11.7. Waiver............................................................................14
11.8. Severability......................................................................15
11.9. Counterparts......................................................................15
11.10. Headings..........................................................................15
11.11. No Third Party Beneficiaries......................................................15
11.12. Further Assurances................................................................15
11.13. Best Efforts......................................................................15
11.14. Expenses..........................................................................15
11.15. Construction......................................................................15
11.16. Specific Performance..............................................................15
11.17. No Agency or Partnership..........................................................15
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SHAREHOLDERS AGREEMENT
THIS SHAREHOLDERS AGREEMENT (this "Agreement") is made and entered into
as of the ____ day of _____, 200__, by and among Metretek, Incorporated, a
Florida corporation (the "Company"), Metretek Technologies, Inc., a Delaware
corporation ("Metretek Technologies"), Xxxxxx Xxxxxxx ("Xxxxxxx"), and such
additional persons and entities that from time to time execute this Agreement as
Employee Shareholders (collectively with Xxxxxxx, the "Employee Shareholders").
RECITALS
WHEREAS, Metretek Technologies is the holder of all (100%) of the
issued and outstanding shares of capital stock of the Company; and
WHEREAS, the Company desires to issue additional shares of its capital
stock on the date hereof to Xxxxxxx, and from time to time hereafter to other
Employee Shareholders; and
WHEREAS, it is a condition to the Company's issuance of shares of its
capital stock that Xxxxxxx and any other Employee Shareholders enter into this
Agreement and that such shares be owned upon the terms and subject to the
conditions set forth herein; and
WHEREAS, the Company, Xxxxxxx and all such additional Employee
Shareholders believe it is in the best interests of the Company and its
shareholders to provide for the stability of the ownership of the Company and to
provide for the orderly issuance, ownership and transfer of the Company's
securities;
AGREEMENT
NOW, THEREFORE, in consideration of the premises and the mutual
covenants and agreements set forth herein, and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto, intending to be legally bound, hereby agree as follows:
SECTION 1. DEFINITIONS.
1.1 Certain Defined Terms. As used herein, the following terms shall
have the following respective meanings:
"Affiliate" means, with respect to any Person, any (i) officer,
director, general partner, trustee, manager, or record or beneficial holder of
more than 10% of the outstanding voting interests of, such Person, (ii) any
other Person which directly or indirectly controls, is controlled by, or is
under common control with such Person, or (iii) any Relation of any of the
foregoing Persons. For purposes of this definition, a Person shall be deemed to
"control" another Person if such Person possesses, directly or indirectly, the
power to direct or cause the direction of the management and policies of the
"controlled" Person, whether through ownership of voting securities, by
contract, or otherwise. For purposes of this Agreement, Persons are
"unaffiliated" with each other if neither is an Affiliate of the other.
"Agreement" means this Shareholders Agreement, as from time to time
amended, supplemented or restated in accordance with the terms of this
Agreement.
"Articles" means the Articles of Incorporation of the Company, as from
time to time amended, supplemented or restated in accordance with the terms of
the Articles and the FBCA.
"Board" means the Board of Directors of the Company.
"Bylaws" means the Bylaws of the Company, as from time-to-time amended,
supplemented or restated in accordance with the terms of the Articles, the
Bylaws and the FBCA.
"Closing" means a closing of the purchase and sale of Shares made
pursuant to this Agreement.
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"Company" means Metretek Contract Manufacturing Company, Inc., a
Florida corporation, and its successors and assigns.
"Employee Shares" means any Shares owned from time to time by the
Employee Shareholders or any Affiliate of the Employee Shareholders.
"FBCA" means the Florida Business Corporation Act, as from time to time
amended, and any successor statutes.
"IPO" means an underwritten initial public offering of Shares pursuant
to a registration statement which has become effective under the Securities Act.
"Metretek Technologies" means Metretek, Incorporated, a Florida
corporation, and its successors and assigns.
"Person" means an individual, corporation, partnership, limited
liability company, joint venture, trust, association, unincorporated
organization, regulatory or governmental body or authority or any other form of
business, entity or organization.
"Purchase Price" means the purchase price to be paid for Shares
purchased and sold under this Agreement.
"Purchaser" means any Person purchasing Shares under this Agreement.
"Relation" means, with respect to any Person, such Person's
grandparents, parents, siblings, spouse, children, stepchildren or
grandchildren, whether by blood, marriage or adoption.
"Representative" means, with respect to a Shareholder, the Person who
is in legal control of the Shares owned by such Shareholder, including, but not
limited to, an executor, representative, guardian or trustee of the Shareholder
or the Shareholder's estate, as applicable.
"Securities Act" means the Securities Act of 1933, as amended.
"Seller" means any Person selling Shares under this Agreement.
"Shares" means the shares of capital stock of the Company, and other
securities into which the shares are converted, reclassified, reorganized or
exchanged.
"Shareholder" means each of the Employee Shareholders and Metretek
Technologies, and any other Person whom after the date hereof becomes bound by
the terms of, and a party to, this Agreement, as the result of or in connection
with a Transfer of Shares to such Person or otherwise.
"Subsidiary" means, with respect to any Person, another Person of which
at least a majority of the voting securities or voting interests of such Person
are owned, directly or indirectly, by such Person.
"Transfer" means any sale, issuance, grant, assignment, transfer,
conveyance, distribution, pledge, hypothecation, encumbrance, disposition,
transfer, gift of, or attempt to create or grant a security interest in the
shares, whether voluntary or involuntary, by operation of law or otherwise
(including, without limitation, by will or intestate distribution, or pursuant
to a merger, consolidation, sale of assets or other form of reorganization).
1.2 Certain Other Defined Terms. Capitalized terms used in this
Agreement that are not defined in Section 2.1 shall be used as defined in this
Agreement.
1.3 Other Definitional Provisions. Except as otherwise expressly
provided herein, as used in this Agreement:
(a) Any reference to any federal, state, local or foreign
statute or law shall be deemed also to refer to all rules and regulations
promulgated thereunder.
(b) The term "including" means "including, without limitation".
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(c) The number and gender of each name and pronoun and the term
"Person" or "Persons" or the like shall be construed to mean such number and
gender as the context, circumstances or its antecedent may require.
(d) The terms "hereof", "herein", "hereunder", and the like
refer to this Agreement as a whole, and not to any Section, subsection, or
clause of this Agreement.
(e) Each reference to a Section means such Section of this
Agreement.
SECTION 2. RESTRICTIONS ON TRANSFERS OF EMPLOYEE SHARES.
2.1 General Restrictions on Transfer. No Employee Shareholder shall
directly or indirectly Transfer or agree to Transfer any Shares now owned or
hereafter acquired by such Employee Shareholder, unless (i) such Transfer is
made in compliance in all respects with the provisions of this Agreement, and
the transferee (if other than the Company or Metretek Technologies) has agreed
in writing to become a party to, and be bound by the terms of, this Agreement as
a holder of Employee Shares and subject to the same terms and conditions as the
Employee Shareholders, or (ii) the Transfer is a "Permitted Transfer" (as
defined in Section 3.6). The restrictions and prohibitions set forth in this
Agreement shall not apply to any Shares owned or held by Metretek Technologies
or any of its subsidiaries.
2.2 Effect of Prohibited Transfer. Any Transfer, or attempted or
purported Transfer, of any Employee Shares that is not made in compliance in all
respects with, or which violates any of, the provisions of this Agreement shall
be null and void and be given no effect, and neither the Company nor any Person
acting as share transfer agent for the Company shall recognize the Transfer or
recognize the transferee as the holder of any Shares for any purpose.
SECTION 3. RIGHT OF FIRST REFUSAL.
3.1 Right of First Refusal.
(a) Notice of Offer. If any Employee Shareholder (the "Selling
Employee Shareholder") receives a bona fide written offer (the "Offer") from any
Person (the "Prospective Purchaser") to purchase any or all of the Selling
Employee Shareholder's Shares (the Shares subject to the Offer hereinafter
referred to as the "Offered Shares"), then such Selling Employee Shareholder
shall first offer such Shares at the proposed purchase price set forth in the
Offer (the "Offer Price") and give notice of the Offer (the "Notice of Offer")
to the Company and to Metretek Technologies. The Notice of Offer shall include
the number of Offered Shares, the Offer Price, the identity of the Prospective
Purchaser and the terms of the proposed Transfer in reasonable detail, including
the name and address of the Prospective Purchaser (including its name and
address), and the other material terms of the Offer. The Notice of Offer shall
also contain an irrevocable offer by the Selling Employee Shareholder to sell
the Offered Shares to the Company upon the terms and conditions of the Rights of
Refusal set forth in this Agreement.
(b) Company's Right of First Refusal. The Company shall have
the irrevocable first right and option (the "Right of First Refusal") to
purchase all, but not less than all, of the Offered Shares upon the terms and
conditions set forth in this Section 3.1(b). The Company may exercise its Right
of First Refusal by giving written notice of such exercise (the "Notice of
Exercise") to the Selling Employee Shareholder on or before the thirtieth (30th)
day after the Company shall have received the Notice of Offer from the Selling
Employee Shareholder. The Company shall have the right, without the consent or
approval of the Employee Selling Shareholder, to assign its Right of First
Refusal with respect to any Offered Shares to Metretek Technologies or any of
its Affiliates, in which case the assignee shall have all of the rights and
duties of the Company under this Agreement with respect to the Offered Shares.
3.2 Purchase Price. The Purchase Price to be paid for each Offered
Share purchased by the Company in accordance with this Section 3 shall be the
Offer Price for such Offered Share as set forth in the Notice of Offer, and
shall be paid on the same terms set forth in the Offer or, at the option of the
Company, by check or wire transfer of immediately available funds, at the
Closing, or by any other means mutually acceptable to the Company and the
Selling Employee Shareholder.
3.3 Closing of Right of First Refusal. The Closing of the purchase
and sale of the Offered Shares pursuant to this Section 3 shall take place at
the principal place of business of the Company on a date forty-five (45)
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business days after the date the Company receives the Notice of Offer, unless
the Company and the Selling Employee Shareholder mutually agree on a different
place or time. At the Closing, the Selling Employee Shareholder shall deliver to
the Company all certificates representing the Offered Shares duly endorsed in
blank, or with duly endorsed blank stock powers attached, and otherwise in
proper form for Transfer, against payment by the Company, by Company, bank
cashiers or certified check, or by wire transfer of immediately available funds
to an account designated by the Selling Employee Shareholder, of the Purchase
Price for the Offered Shares, pursuant to the terms and conditions of the Offer,
as modified as permitted by this Agreement or mutual consent of the Company and
the Selling Employee Shareholder. Upon Closing, the Selling Employee Shareholder
shall conclusively be deemed, unless the Company, in its sole discretion,
provides otherwise in writing, to have given the following representations and
warranties to the Company, which shall survive the Closing: (A) The Selling
Employee Shareholder is the legal, beneficial and record owner of the Offered
Shares, has good and marketable title thereto and the absolute right to Transfer
the same to the Company, and such Offered Shares, upon Transfer to the Company,
will be free and clear of all security interests, pledges, claims, liens,
option, rights of first refusal, limitations or voting rights and restrictions
of any kind whatsoever (other than restrictions imposed by this Agreement and by
federal and state securities laws); and (B) the Transfer of Offered Shares by
the Selling Employee Shareholder as contemplated by this Agreement does not
require any consent or approval of any governmental authority, court or other
Person that has not already been obtained.
3.4 Sale to Prospective Purchaser. If the Right of First Refusal
shall not have been timely exercised for the purchase of all (100%) of the
Offered Shares, then the Selling Employee Shareholder shall have the right, for
a period ending 60 days after the earlier of (i) the day the Right of First
Refusal expires, or (ii) the day the Selling Employee Shareholder receives
notice that the Company will not exercise its Right of First Refusal to purchase
100% of the Offered Shares, to Transfer all, but not less than all, of the
Offered Shares free of the Right of First Refusal to the Prospective Purchaser
at the same price and otherwise upon the same terms (or at a price that is
greater than and/or upon terms more favorable to the Selling Employee
Shareholders than the terms) described in the Offer. If the Selling Employee
Shareholder does not Transfer the Offered Shares to the Prospective Purchaser
within such 60-day period, then the Transfer by the Selling Employee Shareholder
of the Offered Shares will be again subject to the Right of First Refusal. It
shall be a condition of the effectiveness of the Transfer of the Offered Shares
to a Prospective Purchaser that the Prospective Purchaser shall have agreed in
writing with the Company to become a party to this Agreement as an Employee
Shareholder, and to be bound by and to comply with all the terms of this
Agreement applicable to Employee Shareholders, and that the Offered Shares so
purchased shall be subject to all of the restrictions applicable to the Employee
Shareholders' Shares set forth in this Agreement.
3.5 Permitted Transfers. Notwithstanding any other provision of
this Section 3 to the contrary, the following Transfers (collectively, the
"Permitted Transfers") of Shares by the Employee Shareholders shall not be
subject to the Right of First Refusal:
(a) any Transfer of Shares made by an Employee Shareholder to
the Company, Metretek Technologies or a subsidiary of either;
(b) any Transfer of Shares made by an Employee Shareholder to
any Relation of such Employee Shareholder or an Entity owned or controlled by
the Employee Shareholders or any Relation of the Employee Shareholders, for no
consideration for estate planning purposes (provided the transferee complies
with the provisions in clause (ii) of the last sentence of Section 3.4 as if the
transferee were a Prospective Purchaser);
(c) any Transfer of Shares by an Employee Shareholders
pursuant to such Employee Shareholder's Tag-Along Right under Section 4; and
(d) any Transfer of Shares made by an Employee Shareholder
that has been approved in advance in writing by the Company, which approval may
be withheld or delayed for any reason or no reason in its sole discretion.
3.6 Securities Act Matters. Notwithstanding any other provision of
this Agreement to the contrary, but subject to express written waiver by the
Company in the exercise of its good faith and reasonable judgment, the Employee
Shareholders shall not make any Transfer of Shares without the registration of
the Transfer of such Shares under the Securities Act and applicable state
securities laws or until the Company shall have received such legal opinions or
other assurances that such Transfer is exempt from the registration requirements
under the Securities Act and applicable state securities laws as the Company in
its good faith and reasonable discretion deems appropriate in
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light of the fact and circumstances relating to such proposed Transfer, together
with such representations, warranties and indemnifications from the transferor
and the transferee as the Company in its good faith and reasonable discretion
deems appropriate to confirm the accuracy of the facts and circumstances that
are the basis for any such opinion or other assurances and to protect the
Company from any liability resulting from any such Transfer.
SECTION 4. TAG-ALONG RIGHT.
4.1 Tag-Along Right. In the event Metretek Technologies desires to
Transfer all, or any part constituting a majority of all then outstanding
Shares, of its Shares of the Company for value to an unaffiliated third party
("Tag-Along Purchaser"), then the Employee Shareholders shall have the right
("Tag-Along Right"), subject to applicable law and compliance with any other
restrictions applicable to such Transfer, to participate in such Transfer in
accordance with this Section 4.
4.2 Tag-Along Notice. Metretek Technologies may Transfer any
Shares to a Tag-Along Purchaser under the circumstances set forth in Section 4.1
only if (i) the Tag-Along Purchaser agrees to provide the Employee Shareholders
with the right to participate in the Transfer of the Shares to such Tag-Along
Purchaser upon the same terms and conditions as Metretek Technologies, and (ii)
Metretek Technologies first notifies the Employee Shareholders, in writing, of
such intended Transfer at least fifteen (15) days prior to the proposed date of
Transfer (the "Tag-Along Notice"). The Tag-Along Notice shall set forth in
reasonable detail the terms of the Transfer, the date on or about which such
Transfer is to be consummated, the number of Shares to the Transferred, and the
name and address of the Tag-Along Purchaser.
4.3 Exercise of Tag-Along Right. If any Employee Shareholder
desires to exercise his Tag-Along Right under this Section 4, then such Employee
Shareholder shall notify Metretek Technologies in writing within ten (10) days
after receipt of the Tag-Along Notice that he will sell to either the
Prospective Purchaser or to Metretek Technologies, at Metretek Technologies's
option, a number of Shares on the same terms and conditions as the Selling
Stockholder set forth in the Tag-Along Notice. If the Tag-Along Purchaser will
not purchase all of the Shares which the Employee Shareholder wishes to sell
pursuant to this Section 4, then the number of Shares which the Employee
Shareholder may Transfer pursuant to this Section 4 shall be equal to the
product obtained by multiplying (x) the total number of Shares being purchased
by the Tag-Along Purchaser, by (y) a fraction, (i) the numerator of which is the
total number of Shares owned by the Employee Shareholder, and (ii) the
denominator of which is the total number of Shares then outstanding.
4.4 Exceptions. Notwithstanding any other provision of this
Section 4 to the contrary, the Tag-Along Right of the Employee Shareholders set
forth in this Section 4 shall not apply to the following Transfers:
(i) any Transfer of Shares made by Metretek Technologies in
connection with an IPO;
(ii) any Transfer of Shares by Metretek Technologies to any
Employee Shareholder;
(iii) any Transfer of Shares by Metretek Technologies to,
Metretek, the Company or any Affiliate of either; or
(v) any other Transfer of Shares that has been approved in
writing by Employee Shareholders holding a majority of the then outstanding
Employee Shares.
SECTION 5. DRAG-ALONG RIGHT.
5.1 Drag-Along Right. If Metretek Technologies desires to Transfer
all of its Shares in any transaction with an unaffiliated third party
("Drag-Along Purchaser"), then Metretek Technologies shall have the right (the
"Drag-Along Right"), subject to applicable law and compliance with any other
restrictions applicable to such Transfer, to require the Employee Shareholders
to Transfer, and the Employee Shareholders hereby agrees to Transfer, all of the
Employee Shares to the Drag-Along Purchaser, upon the same terms and conditions
as applicable to Metretek Technologies.
5.2 Drag-Along Notice. In order to exercise its Drag-Along Right,
Metretek Technologies shall give written notice to the Employee Shareholders at
least fifteen (15) days prior to the proposed date of Transfer (the "Drag-Along
Notice"). The Drag-Along Notice shall set forth in reasonable detail the terms
and conditions of the
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Transfer, the date on which such Transfer is to be consummated, and the name and
address of the Drag-Along Purchaser.
5.3 Purchase Agreement. If Metretek Technologies exercises its
Drag-Along Right, then the Employee Shareholders shall agree to enter into a
purchase agreement in form and substance approved by Metretek Technologies to
the extent such Agreement shall contain customary representations from the
Employee Shareholders as to the ownership of the Shares to be purchased in the
absence of liens thereon and customary indemnification provisions solely with
respect to such representations from the Employee Shareholders. No Employee
Shareholder shall be required to participate in a proposed Transfer pursuant to
the exercise of the Drag-Along Right unless his liability for breaches of
representations and warranties made in connection with the Transfer is limited
to no more than the total sales price received by such Employee Shareholder in
such sale.
SECTION 6. PREEMPTIVE RIGHTS.
6.1 Preemptive Rights for New Securities. Except in the case of
Excepted Securities (as defined in Section 6.5), the Company shall not issue,
sell or exchange, agree to issue, sell or exchange, or reserve or set aside for
issuance, sale or exchange (i) any Shares, (ii) any other equity security of the
Company, (iii) any debt security of the Company which by its terms is
convertible into or exchangeable for any equity security of the Company, (iv)
any security that is a combination of debt and equity, or (v) any option,
warrant or other right to subscribe for, purchase or otherwise acquire any
equity security or any debt security referred to above to any Person (the "New
Purchaser"), unless in each case the Company shall have first offered (the
"Preemptive Offer") to sell such securities (the "New Securities") to the
Employee Shareholders by delivering to the Employee Shareholders a written
notice of such Preemptive Offer stating that the Company proposes to sell such
New Securities, and setting forth the number or amount and type of the New
Securities proposed to be sold, the proposed purchase price therefor, the
proposed New Purchaser or class of proposed New Purchasers (if known) and any
other terms and conditions of such Preemptive Offer. The Preemptive Offer shall
be its terms remain open and irrevocable for a period of ten (10) days from the
date it is delivered by the Company (the "Preemptive Period").
6.2 Acceptance of Preemptive Offer. Each Employee Shareholder
shall have the option, exercisable at any time during the Preemptive Period by
delivering written notice of acceptance to the Company (an "Acceptance Notice"),
to subscribe for and purchase, on the terms and conditions as set forth in the
Preemptive Offer, the number or amount of such New Securities up to his Equity
Percentage of the total number or amount of New Securities proposed to be
issued. An Employee Shareholder's "Equity Percentage" shall be equal to a
fraction, the numerator of which shall be equal to the total number of Shares
then owned by such Employee Shareholder, and the denominator of which shall be
the total number of Shares then outstanding, in each case including Shares into
which any then outstanding shares of preferred stock are then convertible, but
without giving effect to any other option, warrant or right to acquire Shares.
6.3 Closing of Exercise of Preemptive Offer. The Closing of the
issuance, sale and purchase of the New Securities pursuant to this Section 6
shall take place at the principal office of the Company on the later of the
fifth (5th) business day after the expiration of the Preemptive Notice Period or
the date of the closing of the issuance of New Securities. At such Closing, the
Employee Shareholders desiring to purchase New Securities shall pay the Purchase
Price for the New Securities being purchased as set forth in the Preemptive
Offer by bank cashier's or certified check, or wire transfer of immediately
available funds to an account designated by the Company, along with such written
investment representations and warranties as may be reasonably requested by the
Company for securities law purposes, against delivery of certificates,
registered in the name of such Employee Shareholders, representing the New
Securities so purchased.
6.4 Company Sale of Refused Securities. If Acceptance Notices are
not given by the Employee Shareholders in the aggregate for all of the New
Securities subject to the Preemptive Offer, then the Company shall have the
right for a period of ninety (90) days from the expiration of the Preemptive
Period to sell all or any part of the New Securities as to which Acceptance
Notices have not been given by the Employee Shareholders (the "Refused
Securities") to any other Persons, but only upon terms and conditions that, in
the aggregate, are not more favorable to such other Persons or less favorable to
the Company than those set forth in the Preemptive Offer. Any New Securities not
timely purchased by the Employee Shareholders or any other Persons in accordance
with this Section 6 may not be issued, sold or otherwise Transferred by the
Company until they are again offered to the Employee Shareholders under the
procedures specified in this Section 6.
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6.5 Excepted Securities. As used herein, the term "Excepted
Securities" means (i) Shares (or options therefor) issued, granted or sold to
directors, officers, employees or representatives of, or consultants or advisors
to, the Company under any stock plan approved by the Board; (ii) Shares issued
by the Company in a bona fide underwritten public offering registered under the
Securities Act, (iii) securities issued pursuant to the conversion or exercise
of convertible or exercisable securities, (iv) securities issued in connection
with a stock split or stock dividend or pursuant to a reverse stock split, and
(v) securities listed, granted or sold with the consent of the holders of a
majority of the then outstanding Employee Shares.
SECTION 7. COMPANY'S CALL RIGHT.
7.1 Call Right. In the event that the employment of any Employee
Shareholder (the "Terminated Shareholder") is terminated for any reason, whether
with or without cause, and whether by the Company or by the Terminated
Shareholder, then the Company shall have the irrevocable first right and option
("Call Right"), but not the obligation, for a period of six (6) months year
after the date of termination of the Terminated Shareholder's employment (the
"Call Period") to purchase, and if the Company exercises its Call Right then the
Terminated Shareholder shall have the obligation to sell to the Company, all of
the Shares owned by such Terminated Shareholder on the date of termination of
employment (the "Call Shares"), upon the terms and conditions set forth in this
Section 7. The Company shall have the right, without the consent or approval of
the Terminating Shareholder, to assign its Call Right with respect to any Call
Shares to Metretek Technologies or any of its Affiliates, in which case the
assignee shall have all of the rights and duties of the Company under this
Agreement with respect to the Call Shares.
7.2 Call Price. The Purchase Price to be paid for the Call Shares
purchased in accordance with this Section 7 (the "Call Price") shall be equal to
the value of such Call Shares as determined as follows:
(i) The amount mutually agreed to between the Terminated Shareholder
and the Company, if such agreement can be obtained within thirty (30) days after
the Company gives the Call Notice (as defined below) (the "Call Price Agreement
Period"); or
(ii) The value of the Call Shares as determined by the following
appraisal process. The Company shall select a "Qualified Appraiser" that is
unaffiliated with the Company (the "Company Appraiser"), and give written notice
of the name, address and other reasonable identification of the Company
Appraiser to Terminated Shareholder (the "Company Appraiser Notice"), within
thirty (30) days after the expiration of the Call Price Agreement Period. For
purposes of this Agreement, a "Qualified Appraiser" shall mean an investment
banking firm or other Person that is in the business of conducting, and is
qualified to conduct, an appraisal of businesses such as the business of the
Company. The designation of the Company Appraiser shall be subject to the
approval of the Terminated Shareholder, which approval shall not be unreasonably
withheld and will be deemed to have given, unless the Terminated Shareholder
delivers to the Company, within fourteen (14) days after the Company provides
the Company Appraiser Notice (the "Company Appraiser Objection Period"), written
notice (the "Terminated Shareholder Rejection Notice") of (i) objection to the
Company Appraiser and (ii) the name, address and other reasonable identification
of another Qualified Appraiser unaffiliated with the Terminated Shareholder (the
"Terminated Shareholder Appraiser"). If the Terminated Shareholder does not duly
reject the Company Appraiser, then the value of the Call Shares as determined in
the written opinion of the Company Appraiser shall be binding on the Company and
the Terminated Shareholder for purposes of this Section 7. If the Terminated
Shareholder does duly reject the Company Appraiser and designate an Terminated
Shareholder Appraiser, then within thirty (30) days following the Terminated
Shareholder Rejection Notice, the two appraisers shall determine and state in
writing signed by them their opinion of the value of the Call Shares. In the
event that the appraisers agree on a value of the Call Shares, then such value
shall be binding on the Company and the Terminated Shareholder for purposes of
this Section 7. In the event the two appraisers cannot agree upon a value of the
Call Shares, then (i) the two appraisers shall select a third Qualified
Appraiser (the "Neutral Appraiser") within fourteen (14) days after delivery of
their written opinions, (ii) the Neutral Appraiser shall determine and set forth
in a written opinion within thirty (30) days of being selected the value of the
Call Shares, and the value of the Call Shares shall be equal to the average of
the value thereof set forth in the three appraisals, all with equal weighting.
The Company and the Terminated Shareholder shall each be responsible for
one-half (50%) of all costs and expenses of all appraisers. Signed opinions of
the value of the Call Shares by all appraisers shall be promptly delivered to
both the Company and the Terminated Shareholder.
10
7.3 Mechanics of Exercise. The Company may exercise its Call Right
at any time during the Call Period by giving written notice thereof to the
Terminated Shareholder (the "Call Notice").
7.4 Closing of Call Right. The Closing of the purchase and sale of
the Call Shares pursuant to this Section 7 shall take place at the principal
place of business of the Company no later than fifteen (15) days after the date
the Call Price is determined as provided in Section 7.2, unless the Company and
the Terminated Shareholder mutually agree on a different place or time. At the
Closing, the Terminated Shareholder shall deliver to the Company all
certificates representing the Call Shares duly endorsed in blank, or with duly
endorsed blank stock powers attached, and otherwise in proper form for Transfer,
against payment by the Company of the Call Price by wire transfer of immediately
available funds, or other means mutually acceptable to the Company and the
Terminated Shareholder; provided, however, that the Company shall have the right
to pay up to one-half (50%) of the Call Price, over a time period not to exceed
three (3) years from the Closing, by delivering to the Terminated Shareholder at
the Closing a duly executed promissory note made payable to the Terminated
Employee containing the terms of such payment, and the unpaid principle balance
of the note shall bear interest at the rate announced as of the day prior to the
Closing, as changed on the first business day of each calendar year, announced
by Xxxxx Fargo as its "prime lending rate" (by whatever equivalent term it uses
from time to time). At the Closing, the Terminated Shareholder shall
conclusively be deemed, unless the Company, in its sole discretion, permits
otherwise in writing, to have given the following representations and warranties
to the Company, which shall survive the Closing: (A) the Terminated Shareholder
is the legal, beneficial and record owner of the Call Shares, as good and
marketable title thereto and the absolute right to Transfer the same to the
Company, and the Call Shares, upon Transfer to the Company, will be free and
clear of all security interests, pledges, claims, liens, options, right to first
refusal, limitations on voting rights and restrictions of any kind whatsoever
(other than restrictions imposed by this Agreement and by federal and state
securities laws); and (B) the Transfer of the Call Shares by the Terminated
Shareholder as contemplated by this Agreement does not require any consent or
approval of any governmental authority, court or other Person that has not
already been obtained.
SECTION 8. EFFECTUATION PROVISIONS
8.1 Enabling Action.
(a) If any amendment to the Articles and/or of the Bylaws
of the Company, or any other action requiring the vote, consent or approval of
the shareholders of the Company, is required in order to make permissible or
lawful any of the purchases of its own Shares which the Company may be obligated
or entitled to make in accordance with the terms of this Agreement, then the
Employee Shareholders agree to vote all Employee Shares then held by them in
favor of, or shall consent in writing to, such amendment or action, whether such
amendment or action is voted upon or consented to at, prior to or after the time
of such purchase or purchases by the Company.
(b) The foregoing agreement by the Employee Shareholders
to vote their Employee Shares in a certain manner shall be deemed, in each
instance, to include an agreement by each Employee Shareholder to use his best
efforts to take all actions necessary to call, or cause the Company and the
appropriate officers and directors of the Company to call, as promptly as
practicable, a special meeting of the shareholders or to act by written consent.
(c) When any action is required to be taken by an
Employee Shareholder pursuant to this Agreement, such Employee Shareholder shall
take all steps necessary to implement such action, including calling a special
meeting of shareholders or executing or causing to be executed one or more
consents in writing in lieu of a meeting of the shareholders, in each case as
promptly as practical.
8.2 Legend. The Company shall cause each certificate representing
Employee Shares to bear, in bold, all-caps typeface, the following legends (or
legends to a similar effect):
THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR
THE SECURITIES LAWS OF ANY STATE AND, ACCORDINGLY, NEITHER
THESE SHARES NOR ANY INTEREST THEREIN MAY BE OFFERED, SOLD,
ASSIGNED, TRANSFERRED, PLEDGED OR OTHERWISE DISPOSED OF UNLESS
THE SAME IS REGISTERED UNDER THE SECURITIES ACT OF
11
1933, AS AMENDED, AND ANY APPLICABLE STATE SECURITIES LAWS OR
UNLESS IN THE OPINION OF COUNSEL FOR THE COMPANY AN EXEMPTION
FROM SUCH REGISTRATION IS AVAILABLE AND THE COMPANY RECEIVES
EVIDENCE OF SUCH EXEMPTION REASONABLY SATISFACTORY TO IT
(WHICH EVIDENCE MAY INCLUDE AN OPINION OF COUNSEL).
THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO
RESTRICTIONS ON TRANSFER CONTAINED IN THAT CERTAIN
SHAREHOLDERS AGREEMENT DATED AS OF JUNE 27, 2002 BETWEEN THE
CORPORATION AND CERTAIN OF ITS SHAREHOLDERS. THE COMPANY WILL
MAIL A COPY OF SUCH AGREEMENT TO THE HOLDER OF THIS
CERTIFICATE WITHOUT CHARGE WITHIN FIVE (5) DAYS AFTER RECEIPT
OF A WRITTEN REQUEST THEREFOR.
8.3 Acknowledgement of Necessity of Restrictions. The Employee
Shareholders and the Company agree and acknowledge that the restrictions on the
issuance, transfer and encumbrance of Employee Shares of the Company imposed by
this Agreement are imposed to accomplish legitimate purposes of the Company, and
that such restrictions are not more restrictive than necessary to accomplish
those purposes.
8.4 Record of Transfers. The Company shall not make or record any
Transfer of its Shares which are subject to the provisions of this Agreement on
its books and records unless and until there shall have been full compliance
with the provisions of this Agreement and there shall have been furnished to the
Company such affidavits, certificate or other documents evidencing such
compliance as the Company may reasonably request.
8.5 Voting of Shares. Each Employee Shareholder shall vote any and
all Shares or other voting securities of the Company which he owns or has the
right or power to vote to cause the Company to provide the Employee Shareholders
with the rights and benefits contemplated by this Agreement, and to comply with
and perform fully each of the obligations, commitments, covenants, and
agreements of the Company to and with the Employee Shareholders contained in
this Agreement and shall take any and all action as a shareholder of the Company
as may be necessary to cause the Company to provide such rights and benefits and
to comply with such obligations, commitments, covenants, and agreements.
8.6 No Contrary Action. No Employee Shareholder shall take any
action as an officer, director or shareholder of the Company which would prevent
such Employee Shareholder or the Company from providing the Employee
Shareholders with the rights and benefits contemplated by this Agreement, or
which would otherwise cause such Employee Shareholder or the Company to breach
any of its obligations, commitments, covenants and agreement to and with the
Employee Shareholder set forth in this Agreement.
8.7 Company Determinations. All determinations hereunder by the
Company to exercise any of its rights and obligations shall be made by the
Board, exclusive of the Shareholder who owns, controls or holds the Shares at
issue and his Affiliates.
SECTION 9. TERMINATION OF AGREEMENT
9.1 Termination. This Agreement, and the rights and obligations of
the parties hereunder, shall remain in effect until terminated on the earlier
of:
(a) The date this Agreement is terminated by unanimous
written consent of the Company, Metretek Technologies and all Employee
Shareholders;
(b) The date on which only Metretek Technologies holds all issued
and outstanding Shares;
(c) The date of the consummation of an IPO;
(d) The date of the completion of the liquidation, dissolution
or winding-up of the affairs of the Company; or
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(e) The date of the sale of all of the Shares of the Company
to a third party in compliance with this Agreement.
9.2 Effect of Termination. Termination of this Agreement for any
reason shall not affect any rights or obligations of any Employee Shareholder or
of the Company accrued hereunder prior to such termination, or any right or
remedy with respect to a breach or default hereunder.
SECTION 10. ARBITRATION.
Any dispute, controversy or claim arises out of, under or in connection
with, or otherwise relating to, this Agreement (a "Dispute"), including but not
limited to the parties' rights and obligations hereunder, or any actual or
alleged breach hereof, shall be determined and settled by binding arbitration in
Florida in accordance with the rules of the commercial rules and procedures of
the American Arbitration Association, as amended by this Agreement. Promptly
after a Dispute arises, the parties agree to make a good faith effort to select
one mutually agreeable arbitrator. If the parties are unable to reach agreement
on an arbitrator within thirty (30) days after the Dispute is submitted to
arbitration, one arbitrator shall be selected in accordance with the commercial
rules and procedures of the American Arbitration Association. Any determination,
resolution or award made by the arbitrators shall specify the findings of fact
of the arbitrators and the reasons for the determination, resolution or award,
and such determination, resolution or award shall be final and binding. If the
parties hereto mutually agree to a resolution of any Dispute prior to the
arbitrators' decision, the agreement of the parties shall resolve the Dispute.
The party prevailing in any arbitration, as determined by the arbitrator, shall
be entitled to an award of all of its out-of-pocket costs and expenses incurred
in connection with the Dispute, including but not limited to reasonable
attorneys' fees, court costs and expert fees. An arbitration award or decision
may be entered by any court of competent jurisdiction, or application may be
made to such a court for judicial acceptance of the award or decision and any
appropriate order, including enforcement. The parties hereby consent to the
submission of any Dispute for settlement by binding arbitration in accordance
with this Section 12 and agrees to carry out without delay the provisions of any
arbitration award, decision or resolution.
SECTION 11. GENERAL PROVISIONS.
11.1 Governing Law. This Agreement shall in all respects be
governed by, and construed in accordance with, the internal substantive laws of
the State of Florida, without giving effect to any conflict or choice of law
principles or rules.
11.2 Amendment. This Agreement may not be amended or modified in
whole or in part in any manner except in a writing which makes reference to this
Agreement executed by all parties hereto.
11.3 Assignment. No Employee Shareholder may not assign any or all
of his rights or delegate any or all of his duties under this Agreement without
the prior written consent of the Company, which may be withheld or delayed for
any reason or no reason in its sole discretion.
11.4 Successors and Assigns. This Agreement shall inure to the
benefit of and be binding upon the parties hereto and their respective heirs,
legatees, personal representatives, devisees, executors, successors and
permitted assigns.
11.5 Entire Agreement. This Agreement sets forth the entire
agreement and understanding of the parties hereto with respect to the subject
matter hereof and supersedes in their entirety all prior and contemporaneous
written and oral agreements, arrangements, understandings, negotiations,
communications, covenants, representations and warranties among the parties
hereto relating to the subject matter hereof.
11.6 Notices..Any and all notices, demands, requests, elections and
other communications required or permitted to be given hereunder shall be in
writing and shall be deemed to have been duly given (i) upon personal delivery;
(ii) upon confirmation of receipt when sent by facsimile transmission; (iii) one
business day after deposit during normal business hours with a nationally
recognized overnight courier, specifying next day delivery, with written
verification of receipt; (iv) five business days after being sent by first class
(certified or registered) mail, postage prepaid, return receipt requested, in
each case to the following addresses:
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If to the Company, to:
Metretek, Incorporated.
000 Xxxxx Xxxxx
Xxxxxxxxx, XX 00000
Attn: Chief Executive Officer
Phone 000-000-0000
Fax 000-000-0000
With copies to:
Metretek Technologies, Inc.
000 Xxxx 00xx Xxxxxx
Xxxxxx, Xxxxxxxx 00000
Attn: W. Xxxxxxx Xxxxxx, President
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Xxxx X. Xxxx, Esq.
Kegler, Brown, Hill & Xxxxxx Co., L.P.A.
00 X. Xxxxx Xxxxxx, Xxxxx 0000
Xxxxxxxx, Xxxx 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
If to the Metretek Technologies, to:
Metretek Technologies, Inc.
000 Xxxx 00xx Xxxxxx
Xxxxxx, Xxxxxxxx 00000
Attn: W. Xxxxxxx Xxxxxx, President
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
With copies to:
Xxxx X. Xxxx, Esq.
Kegler, Brown, Hill & Xxxxxx Co., L.P.A.
00 X. Xxxxx Xxxxxx, Xxxxx 0000
Xxxxxxxx, Xxxx 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
If to one or more Employee Shareholders, to:
The address of such Employee Shareholder set
forth on the Signature Page hereof below his
name.
Any party hereto may send any notice, demand, request, election or
other communication to the intended recipient at its address set forth above
using any other means (such as expedited courier, messenger service, telecopy,
telex, ordinary mail or electronic mail), but no such notice, demand, request or
other communication shall be deemed to have been given until it is actually
received by the recipient. Any party hereto may change its designated address by
giving written notice to all other parties. Upon receipt of a request from an
Employee Shareholder, the Company shall provide such Employee Shareholder with a
list of all such addresses.
11.7 Waiver. The obligations of any party hereunder may be waived
only with the written consent of the party or parties entitled to the benefits
the obligations so involved. Any waiver of a breach or violation of or default
under any provision of this Agreement shall not be construed or operate as, or
constitute, a waiver of any
14
other or subsequent breach or violation of or default under that provision or
any other provision of this Agreement. The failure of any party to insist upon
strict compliance with any provision of this Agreement on any one or more
occasions shall not be construed or operate as, or constitute, a continuing
waiver of, or an estoppel of that party's right to insist upon strict compliance
with, that provision or any other provision of this Agreement.
11.8 Severability. If any provision of this Agreement is determined
by any court of law to be illegal, invalid or unenforceable in any situation,
such illegality, invalidity or unenforceability shall not affect or impair the
legality, validity or enforceability of that provision in any other situation or
of any other provision of this Agreement in any situation which shall remain in
full force and effect and this Agreement shall be construed as if such illegal,
invalid or unenforceable provision were omitted. The provisions of this
Agreement shall be deemed severable and the invalidity or unenforceability of
any provision shall not affect the validity or enforceability of the other
provisions hereof or thereof. If any provision of this Agreement, or the
application thereof to any Person or any circumstance, is invalid or
unenforceable: (a) a suitable and equitable provision shall be substituted
therefor in order to carry out, so far as may be valid and enforceable, the
intent and purpose of such invalid or unenforceable provision; and (b) the
remainder of this Agreement and the application of such provision to other
Persons or circumstances shall not be affected by such invalidity or
unenforceability, nor shall such invalidity or unenforceability affect the
validity or enforceability of such provision, or the application thereof, in any
other jurisdiction.
11.9 Counterparts. This Agreement may be executed in any number of
counterparts (including counterparts executed by less than all parties hereto),
each of which shall be deemed to be an original, but all of which together shall
constitute one and the same instrument.
11.10 Headings. The headings used herein are solely for convenience
of reference and shall not be given any effect in the construction or
interpretation of this Agreement.
11.11 No Third Party Beneficiaries. Nothing in this Agreement,
express or implied, in intended to create or confer and shall not be construed
or operate as creating or conferring, any rights or remedies under or by reason
of this Agreement, upon any Person other than the parties hereto and their
respective successors and permitted assigns.
11.12 Further Assurances. The parties hereto agree to take or cause
to be taken all actions, including without limitation, the execution and
delivery of documents and the voting of their Shares, which are necessary,
convenient or desirable in order to effect the transactions contemplated by this
Agreement.
11.13 Best Efforts. Each of the parties hereto shall act in good
faith and use its best efforts to bring about the transactions contemplated by
this Agreement.
11.14 Expenses. Each of the parties to this Agreement shall pay its
own costs and expenses incurred in connection with this Agreement and the
consummation of the transactions contemplated hereby.
11.15 Construction. In the event an ambiguity or question or intent
or interpretation arises, this Agreement shall be construed as if drafted
jointly by the parties hereto and no presumption or burden of proof shall arise
favoring or disfavoring any party hereto by virtue of the authorship of any of
the provisions of this Agreement
11.16 Specific Performance. Each of the parties hereto acknowledges
and agrees that the other parties hereto would suffer irreparable damage for
which an adequate remedy at law would not be available in the event any of the
provisions of this Agreement is not performed in accordance with its specific
terms or otherwise is breached. Accordingly, each of the parties hereto agrees
that the non-breaching parties shall be entitled to an injunction, restraining
order or other form of equitable relief from any court of competent jurisdiction
to prevent breaches of, and to specifically enforce, the provisions of this
Agreement.
11.17 No Agency or Partnership. Nothing contained in this Agreement
shall make or constitute any party to the representative, agent, principal or
partner of any other party and it is understood that no party has the capacity
to make commitments of any kind whatsoever or incur obligations or liabilities
binding upon any other party.
* * * * *
15
IN WITNESS WHEREOF, the parties hereto have duly executed, or cause
their duly authorized representatives to duly execute, this Shareholders
Agreement to be effective as of the day first above written.
THE COMPANY:
METRETEK, INCORPORATED
By:
--------------------------------------
W. Xxxxxxx Xxxxxx, Chairman
METRETEK TECHNOLOGIES
METRETEK TECHNOLOGIES, INC.
By:
--------------------------------------
W. Xxxxxxx Xxxxxx, Chairman
EMPLOYEE SHAREHOLDER:
------------------------------------------
Xxxxxx X. Xxxxxxx, Individually
------------------------------------------
Xxxxxx Xxxxxxx
------------------------------------------
Xxxx, Xxxxx, Zip Code
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SIGNATURE PAGE FOR ADDITIONAL EMPLOYEE SHAREHOLDER
IN WITNESS WHEREOF, the undersigned has duly executed, or cause its
duly authorized representative to duly execute, this Shareholders Agreement, and
has agreed to become a party to this Shareholders Agreement and to be bound by
all terms and conditions set forth therein as an "Employee Shareholder",
effective as of the date set forth below his or its signature below.
EMPLOYEE SHAREHOLDER:
------------------------------------------
Signature
------------------------------------------
Print Name
------------------------------------------
Xxxxxx Xxxxxxx
------------------------------------------
Xxxx, Xxxxx, Zip Code
Dated:
------------------------------------
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