STOCKHOLDERS’ AGREEMENT
Exhibit
10.1
STOCKHOLDERS’ AGREEMENT
This
STOCKHOLDERS’
AGREEMENT (this “Agreement”), dated as of
October 24, 2016, is entered into by and among (i) Smart Server,
Inc., a Nevada corporation (the "Company"), (ii) Berrard Holdings
Limited Partnership, a Delaware limited partnership
(“BHLP”), (iii) Xxxxxx X. Xxxxxxx (together with BHLP,
“Berrard”), (iv) Xxxxxxxx Xxxxxxxx
(“Xxxxxxxx”), and (v) the other stockholders of the
Company listed on the signature page (the
“Stockholders”) (each of the Company, Berrard, Chesrown
and the Stockholders is a "Party" and collectively are referred to
in this Agreement as the "Parties").
WHEREAS, Chesrown and each of the
Stockholders have entered into a letter agreement (each, a
"Purchase Agreement") pursuant to which BHLP has sold to the
respective party shares of common stock, par value $0.001 (the
"Common Stock"), of the Company as set forth in such Purchase
Agreement; and
WHEREAS, the Parties desire to provide
for certain governance rights and other matters, and to set forth
certain rights and obligations of the Parties with respect to the
Company and the Shares of Common Stock owned by such Party on and
after the date hereof.
NOW THEREFORE, in consideration of the
mutual covenants and agreements contained in this Agreement, the
receipt and sufficiency of which are hereby acknowledged, the
Parties agree as follows:
ARTICLE
I
DEFINITIONS
As used
in this Agreement, the following terms shall have the following
respective meanings:
“Affiliate” means, with
respect to any Person, any (a) director, officer, limited or
general partner, member or stockholder holding five percent (5%) or
more of the outstanding capital stock or other equity interests of
such Person, (b) spouse, parent, sibling or descendant of such
Person (or a spouse, parent, sibling or descendant of a Person
specified in clause (a) above relating to such Person) and (c)
other Person that, directly or indirectly, through one or more
intermediaries, Controls, or is Controlled by, or is under common
Control with, such Person.
"Berrard Directors" has the
meaning set forth in Section 2.1(d).
“Board”
means the Board of Directors of the Company.
“Charter” means the
Articles of Incorporation of the Company, as amended from time to
time.
“Chesrown Directors” has
the meaning set forth in Section 2.1(a).
“Common
Stock” means the shares of common stock, par value
$0.001 per share, of the Company.
“Company”
has the meaning set forth in the preamble.
“Control” means
(including, with correlative meanings, “controlled by” and
“under common
control with”), with respect to any Person, the
possession, directly or indirectly, of the power to direct or cause
the direction of the management or policies of a Person, whether
through the ownership of voting securities, by contract or
otherwise.
“Equity Securities” means
all shares of capital stock of the Company, including, without
limitation, all securities convertible into or exchangeable for
shares of capital stock of the Company, and all options,
warrants, and other rights to
purchase or otherwise acquire from the Company shares of such
capital stock, including any stock appreciation or similar rights,
contractual or otherwise.
1
“Exchange Act” means the
Securities Exchange Act of 1934, as amended.
“SEC” means the U.S.
Securities and Exchange Commission.
“Securities Act” means the
Securities Act of 1933, as amended.
ARTICLE
II
2.1. Board
Representation.
(a) As of the date
hereof, the Board shall be comprised of five (5) directors.
Beginning at the closing of the transactions contemplated by the
Purchase Agreement and thereafter, for so long as Chesrown, or an
Affiliate of Chesrown beneficially owns, in the aggregate, at least
1,000,000 shares of the Company's issued and outstanding Common
Stock (the "Minimum Threshold"), the Board shall be comprised of no
more than five (5) directors, and Chesrown shall be entitled to (i)
nominate three (3) individuals to the Board (such individuals,
including their respective successors, the “Chesrown
Directors”), to serve as members of the Board until their
respective successors are elected and qualified, (ii) nominate any
successor to each Chesrown Director, and (iii) direct the removal
from the Board of any Chesrown Director; provided, that at least two of the
Chesrown Directors shall be “independent” as defined by
the applicable rules and regulations of the SEC and the NASDAQ
stock market. The Chesrown Directors shall initially be
Xxxxxxxx Xxxxxxxx,
Xxxxx Xxxxxx, and Xxxxx
Xxxxxxxx.
(b) Beginning with the
first annual meeting of stockholders following the closing of the
transactions contemplated by the Purchase Agreement with Chesrown
and thereafter, for so long as Chesrown or an Affiliate of Chesrown
beneficially owns, in the aggregate, at least the Minimum
Threshold, each nomination to the Board of any Chesrown Director
for election at an annual meeting of stockholders of the Company
shall be made by delivering to the Company a notice signed by
Chesrown, which notice shall include the names and qualifications
of such proposed Chesrown Directors. As promptly as practicable,
the Company shall provide a copy of such notice to the
Company’s Corporate Governance and Nominating Committee (the
“Committee”), which shall, if the proposed Chesrown
Director satisfies the criteria for qualifications of directors set
forth in the Charter of the Committee (the “Charter”)
in all material respects, as determined in good faith by the
Committee, at the next Committee meeting at which Board nominees
are determined for purposes of the Company’s annual meeting
of stockholders, make a recommendation to the Board that such
Chesrown Directors shall be nominated for election to the Board at
the Company's next annual meeting of stockholders and shall, in the
Company’s proxy statement relating to such annual meeting,
recommend to the Company's Stockholders that the Stockholders
should vote their shares in favor of the election of the proposed
Chesrown Directors. If the Committee reasonably determines in good
faith that a proposed Chesrown Director does not meet such
criteria, the Committee shall notify Chesrown of such fact within
10 days following receipt of the Chesrown Notice, specifying in
reasonable detail the reasons for the determination that such
criteria have not been met, and within 10 calendar days Chesrown
may submit to the Committee a new proposed Chesrown
Director.
(c) For so long as
Chesrown or an Affiliate of Chesrown beneficially owns, in the
aggregate, at least the Minimum Threshold, each nomination to the
Board of any Chesrown Director for election other than at an annual
meeting of stockholders of the Company (whether due to the
resignation, removal or death of a Chesrown Director or otherwise)
shall be made by delivering to the Company a notice signed by
Chesrown, which notice shall include the names and qualifications
of such proposed Chesrown Director. As promptly as practicable, the
Company shall provide a copy of such notice to the Committee, which
shall, if the proposed Chesrown Director satisfies the criteria for
qualifications of directors set forth in the Charter in all
material respects, as determined in good faith by the Committee, as
promptly as practicable, make a recommendation to the Board that
such Chesrown Directors shall be appointed for election to the
Board, which appointment may be made by the Board to the extent
permitted pursuant to the Company’s bylaws. As promptly as
practicable thereafter, the Company shall take or cause to be taken
such corporate actions as may be required to cause such appointment
to be effected. If the Committee reasonably determines in good
faith that such proposed Chesrown Director does not meet such
criteria, the Committee shall notify Chesrown of such fact within
10 days of receipt of the Chesrown Notice, specifying in reasonable
detail the reasons for the determination that such criteria have
not been met, and within 10 calendar days Chesrown may submit to
the Committee a new proposed Chesrown Director.
2
(d) Beginning at the
closing of the transactions contemplated by the Purchase Agreement
with Chesrown and thereafter for so long as Berrard, or an
Affiliate of Berrard beneficially owns, in the aggregate, at least
the Minimum Threshold, the Board shall be comprised of no more than
five (5) directors, and Berrard shall be entitled to (i) nominate
one individual to the Board (such individual, including such
individual's successor, the “Berrard Director”), to
serve as a member of the Board until the Berrard Director's
successor is elected and qualified, (ii) nominate any successor to
the Berrard Director, and (iii) direct the removal from the Board
of the Berrard Director. The Berrard Directors shall initially be
Xxxxxx X. Xxxxxxx.
(e) Beginning with the
first annual meeting of stockholders following the closing of the
transactions contemplated by the Purchase Agreement with Chesrown
and thereafter, for so long as Berrard, or an Affiliate of Berrard
beneficially owns, in the aggregate, at least the Minimum
Threshold, each nomination to the Board of any Berrard Director for
election at an annual meeting of stockholders of the Company shall
be made by delivering to the Company a notice signed by Berrard,
which notice shall include the name and qualifications of the
proposed Berrard Director. As promptly as practicable, the Company
shall provide a copy of such notice to the Committee which shall,
if the proposed Berrard Director satisfies the criteria for
qualifications of directors set forth in the Charter in all
material respects, as determined in good faith by the Committee, at
the next Committee meeting at which Board nominees are determined
for purposes of the Company’s annual meeting of stockholders,
make a recommendation to the Board that such Berrard Director shall
be nominated for election to the Board at the Company's next annual
meeting of stockholders and shall, in the Company’s proxy
statement relating to such annual meeting, recommend to the
Company's Stockholders that the Stockholders should vote their
shares in favor of the election of the proposed Berrard Directors.
If the Committee reasonably determines in good faith that a
proposed Berrard Director does not meet such criteria, the
Committee shall notify Berrard of such fact within 10 days
following receipt of the Berrard Notice, specifying in reasonable
detail the reasons for the determination that such criteria have
not been met, and within 10 calendar days Berrard may submit to the
Committee a new proposed Berrard Director.
(f) For so long as
Berrard or an Affiliate of Berrard beneficially owns, in the
aggregate, at least the Minimum Threshold, each nomination to the
Board of any Berrard Director for election other than at an annual
meeting of stockholders of the Company (whether due to the
resignation, removal or death of a Berrard Director or otherwise)
shall be made by delivering to the Company a notice signed by
Berrard, which notice shall include the names and qualifications of
such proposed Berrard Director. As promptly as practicable, the
Company shall provide a copy of such notice to the Committee, which
shall, if the proposed Berrard Director satisfies the criteria for
qualifications of directors set forth in the Charter in all
material respects, as determined in good faith by the Committee, as
promptly as practicable, make a recommendation to the Board that
such Berrard Director shall be appointed for election to the Board,
which appointment may be made by the Board to the extent permitted
pursuant to the Company’s bylaws. As promptly as practicable
thereafter, the Company shall take or cause to be taken such
corporate actions as may be required to cause such appointment to
be effected. If the Committee reasonably determines in good faith
that such proposed Berrard Director does not meet such criteria,
the Committee shall notify Berrard of such fact within 10 days of
receipt of the Berrard Notice, specifying in reasonable detail the
reasons for the determination that such criteria have not been met,
and within 10 calendar days Berrard may submit to the Committee a
new proposed Berrard Director.
3
(g) The Company shall
include in the slate of nominees recommended by the Board for
election as directors each Chesrown Director and the Berrard
Director for so long as Chesrown and Berrard, respectively, are
entitled to nominate the Chesrown and Berrard Directors pursuant to
this Agreement. Each of Berrard, Chesrown, and each of the
Stockholders covenants and agrees to vote all Equity Securities
held by such person or their Affiliate for the election to the
Board of all individuals nominated in accordance with this Section
2.1.
2.2. Vacancies
and Removal.
(a) The Berrard and
Chesrown Directors will be elected at each annual meeting of the
Company’s stockholders and will serve until their successors
are duly elected and qualified or until their earlier resignation
or removal in accordance with this Agreement.
(b) Each of Berrard and
Chesrown agrees to vote, or cause to be voted, all Equity
Securities beneficially owned by them, or over which such person
has voting control, from time to time and at all times, in whatever
manner as shall be necessary to ensure that:
(i) no Berrard or
Chesrown Director may be removed from office unless such removal is
directed or approved by Berrard or Chesrown, respectively, or such
removal is for cause, as reasonably determined in good faith by the
Board; and
(ii) any
vacancies created by the resignation, removal or death of a Berrard
or Chesrown Director shall be filled as proposed by Berrard or
Chesrown, respectively, in accordance with Section 2.1 of this
Agreement.
2.3. Restrictions
on Transfer and Other Agreements.
(a) Each of Berrard,
Chesrown, and the Stockholders hereby agrees that Berrard,
Chesrown, or such Stockholder will not, prior to the first
anniversary of the date hereof (the “Restricted
Period”), offer, pledge, sell, contract to sell, sell any
option or contract to purchase, purchase any option or contract to
sell, grant any option, right or warrant to purchase, lend or
otherwise transfer or dispose of, directly or indirectly, any
shares of Common Stock or any securities convertible into or
exercisable or exchangeable for Common Stock
(“Transfer”). The foregoing sentence shall not apply to
(a) Transfers of shares of Common Stock or any security
convertible into Common Stock as a bona fide gift,
(b) Transfers to such Stockholder’s family or by will or
intestate succession to such Stockholder’s family or to a
trust, the beneficiaries of which are exclusively such Stockholder
or members of such Stockholder’s family, (c) Transfers
by such Stockholder to any entity that is directly or indirectly
Controlled by, or is under common Control with, such Stockholder,
(d) the establishment of a trading plan pursuant to Rule
10b5-1 under the Exchange Act for the sale of shares of Common
Stock, provided that such
plan does not provide for the transfer of shares of Common Stock
during the Restricted Period, or (e) Transfers of equity
securities of the Company for purposes of paying any such
Stockholder’s tax liability related to or in connection with
vested equity awards (“Permitted
Transfers”).
(b) Neither
Berrard or Chesrown, nor any Stockholder nor any of their
respective Affiliates shall grant any proxy or enter into or agree
to be bound by any voting trust, agreement or arrangement of any
kind with any Person with respect to its Common Stock if and to the
extent the terms thereof conflict with the provisions of this
Agreement and each of Berrard and Chesrown shall take all necessary
actions within its power to cause the Company to comply with the
provisions of this Agreement.
4
ARTICLE
III
MISCELLANEOUS
3.1. Termination.
This
Agreement shall terminate and be of no further force and effect
upon the written agreement of Xx. Xxxxxxx and Xx.
Xxxxxxxx.
3.2. Successors
and Assigns; Beneficiaries.
Except
as otherwise provided herein, all of the terms and provisions of
this Agreement shall be binding upon, shall inure to the benefit of
and shall be enforceable by the respective successors and permitted
assigns of the parties hereto and any of their respective
successors and permitted assigns. This Agreement may not be
assigned without the express prior written consent of the other
parties hereto, and any attempted assignment, without such
consents, will be null and void; provided, that each Party (from time to time party
hereto) shall be entitled to assign its rights and obligations
hereunder to any Affiliate of such Party; provided, such transferee executes a
joinder agreeing to be bound by the terms of this Agreement in the
same capacity as the transferring Party.
3.3. Amendment
and Modification; Waiver of Compliance.
(a) This Agreement may
be amended only by a written instrument duly executed by the
Company and the Parties hereto.
(b) Except as otherwise
provided in this Agreement, any failure of any of the parties to
comply with any obligation, covenant, agreement or condition herein
may be waived by the party entitled to the benefits thereof only by
a written instrument signed by the party granting such waiver, but
such waiver or failure to insist upon strict compliance with such
obligation, covenant, agreement or condition shall not operate as a
waiver of, or estoppel with respect to, any subsequent or other
failure.
3.4. Notices.
Any
notice, request, claim, demand, document and other communication
hereunder to any party shall be effective upon receipt (or refusal
of receipt) and shall be in writing and delivered personally or
sent by e-mail, facsimile, or first class mail, or by Federal
Express, United Parcel Service or other similar courier or other
similar means of communication to:
the
Company or Berrard:
0000
Xxxxxx Xxxx
Xxxxx
000
Xxxxxxxxx, XX
00000
with a
copy to:
Akerman
LLP
Attn:
Xxxxxxx Xxxxxxx
000
Xxxx Xxx Xxxx Xxxx, Xxxxx 0000
Xxxx
Xxxxxxxxxx, XX 00000
xxxxxxx.xxxxxxx@xxxxxxx.xxx
Fax:
000.000.0000
5
Chesrown:
Xxxxxxxx
Xxxxxxxx
0000
Xxxxx Xxxxx
Xxxxxxxxx, XX
00000
with a
copy to:
S. Xxx
Xxxxx, Jr.
Xxxxx
Xxxxxx & Xxxxxx LLP
0000
00xx
Xxxxxx #000
Xxxxxx,
XX 00000
xxxx.xxxxx@xxxxxx.xxx
Fax:
000.000.0000
The
Stockholders:
at such
address set forth opposite such Stockholder’s
name on
the signature page,
or, in
each case, to such other address as such party may designate in
writing to the other parties by written notice given in the manner
specified herein.
3.5. Specific
Performance.
Each
party hereto acknowledges and agrees that in the event of any
breach of this Agreement by any of them, the other parties hereto
would be irreparably harmed and could not be made whole by monetary
damages. Each party accordingly agrees to waive the defense in any
action for specific performance that a remedy at law would be
adequate and agrees that the parties, in addition to any other
remedy to which they may be entitled at law or in equity, shall be
entitled to specific performance of this Agreement without the
posting of bond.
3.6. Entire
Agreement.
The
provisions of this Agreement and the other writings referred to
herein or delivered pursuant hereto which form a part hereof
contain the entire agreement among the parties hereto with respect
to the subject matter hereof and supersede all prior oral and
written agreements and memoranda and undertakings among the parties
hereto with regard to such subject matter.
3.7. Severability.
If any
provision of this Agreement, or the application of such provision
to any Person or circumstance or in any jurisdiction, shall be held
to be invalid or unenforceable to any extent, (i) the remainder of
this Agreement shall not be affected thereby, and each other
provision hereof shall be valid and enforceable to the fullest
extent permitted by law, (ii) as to such Person or circumstance or
in such jurisdiction such provision shall be reformed to be valid
and enforceable to the fullest extent permitted by law and (iii)
the application of such provision to other Persons or circumstances
or in other jurisdictions shall not be affected
thereby.
3.8. Governing
Law.
This
Agreement shall be governed by and construed in accordance with the
laws of the State of Nevada without regard to conflicts of law
principles thereof.
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3.9. Waiver
of Jury Trial.
EACH
PARTY ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY WHICH MAY ARISE
UNDER THIS AGREEMENT IS LIKELY TO INVOLVE COMPLICATED AND DIFFICULT
ISSUES, AND THEREFORE EACH SUCH PARTY HEREBY IRREVOCABLY AND
UNCONDITIONALLY WAIVES ANY RIGHT SUCH PARTY MAY HAVE TO A TRIAL BY
JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING
OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS
CONTEMPLATED HEREBY, OR IN ANY WAY CONNECTED WITH OR RELATED OR
INCIDENTAL TO THE DEALINGS OF THE PARTIES OR ANY OF THEM IN RESPECT
OF THIS AGREEMENT. EACH PARTY CERTIFIES AND ACKNOWLEDGES THAT (i)
NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS
REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD
NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING
WAIVER, (ii) EACH SUCH PARTY UNDERSTANDS AND HAS CONSIDERED THE
IMPLICATIONS OF THIS WAIVER, (iii) EACH SUCH PARTY MAKES THIS
WAIVER VOLUNTARILY, AND (iv) EACH SUCH PARTY HAS BEEN INDUCED TO
ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE WAIVERS AND
CERTIFICATIONS IN THIS SECTION. EACH PARTY AGREES THAT THE OTHER
MAY FILE A COPY OF THIS AGREEMENT WITH ANY COURT AS WRITTEN
EVIDENCE OF THE CONSENT OF THE PARTIES TO THE WAIVER OF THEIR RIGHT
TO TRIAL BY JURY.
3.10. 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.
3.11. Further
Assurances.
At any
time or from time to time after the date hereof, the parties hereto
agree to cooperate with each other, and at the request of any other
party, to execute and deliver any further instruments or documents
and to take all such further action as any other party may
reasonably request in order to evidence or effectuate the
provisions of this Agreement and to otherwise carry out the intent
of the parties hereunder.
3.12. Schedule
13D.
In
accordance with the requirements of Rule 13d-1(k) under the
Exchange Act, as amended (the “Exchange
Act”), and subject to the limitations set forth
therein, each Party agrees to file an appropriate Schedule 13D no
later than 10 calendar days following the date hereof and, if
required a Form 3 no later than 10 calendar days following the date
of the closing of the Party's purchase of Equity Securities
pursuant to the Party's Purchase Agreement.
7
IN
WITNESS WHEREOF, each of the undersigned has signed this
Stockholders’ Agreement as of the date first above
written.
| Smart Server, Inc. |
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By:
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/s/
Xxxxxx
X. Xxxxxxx
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Chief Executive
Officer, Chairman and
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Interim Chief
Financial Officer
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| Berrard Holdings Limited Partnership |
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Berrard Holdings, LLC, its general partner |
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| By: | /s/ Xxxxxx X. Xxxxxxx |
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| Title: | Sole Member |
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/s/
Xxxxxx X. Xxxxxxx
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Xxxxxx
X. Xxxxxxx
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/s/ Xxxxxxxx
Xxxxxxxx
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| Xxxxxxxx Xxxxxxxx |
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Stockholder:
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JWC
Investments, Inc.
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/s/
Xxxx Check
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/s/ Xxx Xxxxx |
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Xxxx
Xxxxx
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Xxx Xxxxx |
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Blue
Flame Capital, LLC
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/s/ Xxxxxx X.
Xxxxx
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/s/ Xxxx Xxxx |
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Xxxxxx X.
Xxxxx
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Xxxx Xxxx |
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/s/ Xxx
Xxxxxx
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/s/
Xxx
Xxxxxxx |
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Xxx
Xxxxxx
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Xxx
Xxxxxxx |
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/s/ Xxxxxxx
Xxxx
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/s/ Xxxxx Xxxxx |
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Xxxxxxx
Xxxx
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Xxxxx Xxxxx |
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{39816765;1}
[Signature
Page to Stockholders’ Agreement]
8
