EXHIBIT 4.3
STOCK REPURCHASE AGREEMENT
FOR EMPLOYEE STOCKHOLDERS
THIS STOCK REPURCHASE AGREEMENT ("Agreement") is made on --------,
between ------------------------------------------- (the "Stockholder") and
XXXXX XXXXXX SONS', INC., a Delaware corporation (the "Corporation").
WHEREAS, the Corporation's Restated Certificate of Incorporation, as
amended from time to time (the "Certificate") sets forth certain restrictions
on the ownership and transfer of shares of the Corporation's $0.01 par value
common stock ("Common Stock"); and
WHEREAS, the Stockholder desires to own Common Stock subject to the terms
and restrictions set forth in this Agreement and in the Certificate.
NOW THEREFORE, in consideration of the issuance of Common Stock to the
Stockholder and for other good and valuable consideration, the receipt and
sufficiency of which is acknowledged by each of the parties hereto, the
Stockholder and the Corporation agree as follows:
(1) Common Stock Subject to Agreement. This Agreement shall apply to
all Common Stock issued to or owned by the Stockholder on or before the date
of this Agreement and any additional shares of Common Stock which are issued
to or owned by the Stockholder after the date of this Agreement. This
Agreement supersedes any previous agreement between the Corporation and the
Stockholder relating to such Common Stock and the sale or repurchase of such
Common Stock by the Corporation.
(2) Prohibited Transfers of Common Stock. Except as specifically
provided in this Agreement and the Certificate, the Stockholder shall not
sell, assign, give, bequeath, pledge, or otherwise transfer any or all of the
Stockholder's Common Stock by any means, whether voluntary or involuntary. Any
such attempted sale or transfer shall be void and of no force or effect. If
such transfer is attempted, the Corporation shall give written notice to the
Stockholder to sell and deliver all of such Common Stock to the Corporation
within 90 days after the date on which the Corporation receives actual notice
of the attempted or proposed transfer.
(3) Voluntary Sales of Common Stock to Corporation. The Stockholder
may sell all or part of the Stockholder's Common Stock to the Corporation by
delivering to the Corporation the certificates representing the Common Stock
to be sold with a written notice stating the Stockholder's desire to sell such
Common Stock. The Corporation will accept such notice only during the first
fifteen days of each calendar month. Notices received thereafter will be
deemed to have been received on the first day of the following month. The
Corporation shall purchase any Common Stock so offered. Notwithstanding the
foregoing, the Stockholder's right to voluntarily sell Common Stock and the
Corporation's duty to repurchase such Common Stock are subject to the terms
and conditions of the Certificate, including those referenced in Paragraph 17
of this Agreement.
(4) Corporation's Option to Purchase All Shares of Common Stock. If
the Stockholder attempts to make a prohibited transfer of, or voluntarily
sells to the Corporation, part of the Stockholder's Common Stock, the
Corporation shall have the option to purchase all or any part of the
Stockholder's remaining Common Stock. The Corporation may exercise this option
within 90 days after (a) the date of the written notice to the Stockholder
referred to in Paragraph 2 in the case of an attempted prohibited transfer, or
(b) the receipt of the certificates and written notice referred to in
Paragraph 3 in the case of a voluntary sale to the Corporation. The
Corporation may exercise such option by giving the Stockholder written notice
to sell and deliver all or part of the Stockholder's remaining Common Stock,
as specified in such notice.
(5) Termination of Employment. Within 90 days after the termination
of the Stockholder's employment for any reason other than death, the
Corporation shall give a written notice to the Stockholder to sell and deliver
all of such Stockholder's Common Stock to the Corporation. For the purpose of
this Agreement, "employment" means employment by the Corporation, one of its
subsidiaries, a joint venture in which the Corporation and/or its subsidiaries
have a 20 percent or more interest, KCP, Inc. or any subsidiary thereof or any
joint venture in which KCP, Inc. or any such subsidiary has a 20 percent or
more interest. "Subsidiaries" of the Corporation are any corporation in which
the Corporation owns directly or indirectly at least 20 percent of the
outstanding capital stock, based on the total dollar value of outstanding
stock if there is more than one class of stock outstanding. "Subsidiaries" of
KCP, Inc. are any corporation in which KCP, Inc. owns directly or indirectly
at least a majority of the outstanding capital stock, based on the total
dollar value of outstanding stock if there is more than one class of stock
outstanding.
(6) Death.
(a) Within 180 days after the death of the Stockholder, the
Corporation shall give a written notice to the Stockholder's successors or the
personal representative of the Stockholder's estate to sell and deliver all of
such Stockholder's Common Stock to the Corporation.
(b) Notwithstanding Paragraph 11 of this Agreement, the deceased
Stockholder's successors or the personal representative of the Stockholder's
estate shall have the option to fix one or more alternate dates for the sale
of the Common Stock by giving written notice of such dates to the Corporation
and identifying the shares of Common Stock to be sold on such dates. Notice of
any alternate sales dates must be given within 180 days after the death of the
Stockholder or within 10 days after the date of the Corporation's notice to
sell and deliver under giver paragraph (6)(a), above, whichever comes first.
The earliest alternate sale date may be the date of the notice given by the
representative under this paragraph (6)(b) and the latest sale date shall be
the tenth day of January following the end of the fiscal year of the
Corporation during which the Stockholder died. The stock certificates
representing the Common Stock to be sold on a particular date shall be
delivered to the Corporation on or before such date.
(7) Authorized Transfers and Pledges of Common Stock.
(a) With the prior approval of the Board of Directors of the
Corporation (the "Board"), the Stockholder may transfer Common Stock to a tax-
exempt charitable organization approved as such by the Internal Revenue
Service.
(b) With the prior approval of the Board, a Stockholder may transfer
Common Stock to: (i) a fiduciary for the benefit of the members of the
Stockholder's immediate family, (ii) a corporation 100 percent owned by the
Stockholder or the Stockholder and their spouse and/or children, or (iii) a
fiduciary for the benefit of such a corporation.
(c) As a condition precedent to transfer, each transferee under
Paragraph (7)(a) or (b) above must sign a new repurchase agreement in a form
satisfactory to the Corporation.
(d) The Stockholder may pledge Common Stock for loans in connection
with the ownership of Common Stock. "Qualified Financial Institutions" (as
defined in the Certificate) to which such Common Stock has been pledged shall
be permitted to own such Common Stock upon foreclosure of such Common Stock in
accordance with the terms of any agreement evidencing such pledge, subject to
such ownership and transfer restrictions set forth in the Certificate.
(8) Excessive Amount of Common Stock. Under Article Sixth,
subparagraph (D)(3)(d) of the Certificate, upon a determination by the Board
that the amount of Common Stock held by the Stockholder is excessive in view
of the Corporation's policy that the level of Stockholder's stock ownership
should reflect certain factors, including but not limited to (a) the relative
contribution of that Stockholder to the economic performance of the
Corporation, (b) the effort being put forth by such Stockholder, and/or (c)
the level of responsibility of such Stockholder, the Corporation shall have
the option to purchase from such Stockholder an amount of Common Stock
sufficient to decrease the amount of Common Stock owned by such Stockholder to
an amount that the Board, in its discretion, believes is appropriate. In the
event that the Corporation elects to exercise this option, it shall give the
Stockholder written notice to sell and deliver to the Corporation the amount
of Common Stock specified in such notice.
(9) Purchase Price for Common Stock. Article Sixth, subparagraph
(D)(4) of the Certificate, provides that, if the Corporation is to repurchase
shares of Common Stock, the purchase price shall be the Common Share Price.
Article Eighth of the Corporation's Certificate sets forth definitions of the
terms "Common Share Price", as well as "Formula Value", and other terms
relevant to calculating the price applicable to any particular repurchases.
These provisions of the Certificate are incorporated herein by reference. The
Corporation shall purchase Common Stock for the Common Share Price determined
as of the following respective dates: (i) the date upon which the Corporation
receives certificates evidencing such Common Stock in the event of a voluntary
sale by the Stockholder under Paragraph 3 of this Agreement, and (ii) the date
certificates representing such Common Stock are required to be delivered to
the Corporation in the event of any other sale under this Agreement.
(10) Payment. Subject to Paragraph 11 of this Agreement:
(a) The Corporation shall make payment for any Common Stock it
purchases within 60 days after (i) the date upon which the Corporation
receives stock certificates evidencing such Common Stock in the event of a
voluntary sale by the Stockholder under Paragraph 3 of this Agreement, (ii)
the date of the sale of such Common Stock specified in any notice given by the
Stockholder's successors or personal representative under Paragraph 6(b) of
this Agreement, or (iii) the date of the Corporation's written notice to sell
and deliver such Common Stock in the event of any other sale under this
Agreement; provided, however, that no payment shall be required to be made
with respect to the purchases and sales of Common Stock described in clauses
(ii) or (iii) until the Corporation shall have received stock certificates
evidencing such Common Stock.
(b) The Corporation shall be authorized to deduct from the payment of
the purchase price for Common Stock sold by the Stockholder any amount owed by
the Stockholder to the Corporation, any subsidiary of the Corporation and/or
to any pledgee of such Common Stock; provided, however that the purchase price
otherwise payable to a Qualified Financial Institution shall not be reduced by
any amount owed to the Corporation or any subsidiary of the Corporation by the
Stockholder who pledged the Common Stock to the Qualified Financial
Institution. Payment of the purchase price shall otherwise be made as directed
by the Stockholder.
(c) The Corporation shall not be obligated to pay any interest on any
amounts to be paid under this Agreement.
(d) If the per share price at which the Corporation is to purchase
Common Stock has not been computed within the time prescribed for payment
under this Agreement because the preparation of the audited Consolidated
Financial Statements of the Corporation and Consolidated Subsidiaries has not
yet been completed, the Corporation shall make an "initial payment" within the
time period prescribed for payment for such Common Stock, using the per share
price applicable to purchases of Common Stock during the preceding fiscal
year. If the per share price for purchases during the current year is
determined to be greater than that for the preceding year, the Corporation
shall pay the difference between the initial payment and the actual amount
entitled to be received under the current per share price within 10 days after
the date upon which the per share price for the current year is completed. If
the per share price for purchases during the current year is determined to be
less than that for the preceding year, the person or entity to whom the
initial payment was made shall repay the difference between the initial
payment and the actual amount entitled to be received under the current per
share price within 10 days after the date of a written notice from the
Corporation requiring payment of such amount.
(11) Surrender of Common Stock. Except as otherwise provided in the
Certificate or Paragraph 6(b) of this Agreement, the Stockholder or the
Stockholder's successors or the personal representative of the Stockholder's
estate must sell and deliver stock certificates to the Corporation within 10
days after the date of the Corporation's notice to sell and deliver such
Common Stock. Any stock certificate to be sold to the Corporation must be
endorsed in blank or accompanied by appropriate stock powers executed in
blank, and accompanied by such other evidence of authority as the Corporation
may reasonably require. In the event of failure to deliver stock certificates
with required evidence of authority within the time periods specified, the
Corporation's Secretary shall cancel each certificate on the books of the
Corporation and such shares of Common Stock shall be deemed no longer
outstanding. The holder of canceled shares of Stock shall have no further
interest as a stockholder of the Corporation with respect to such shares of
Common Stock except the right to receive the purchase price.
(12) Notices. Any notices under this Agreement shall be in writing
and shall be sufficient if delivered in person or sent by certified mail,
return receipt requested. The notice to the Stockholder or the Stockholder's
successors or personal representative, if mailed, shall be sent to the
Stockholder's last known address. The notice to the Corporation shall be
delivered or mailed to the Secretary, Xxxxx Xxxxxx Sons' Inc., Xxxxxx Xxxxx,
Xxxxx, Xxxxxxxx 00000.
(13) Governing Law. This Agreement shall be governed by the laws of
the State of Delaware.
(14) Failure to Meet Times. No failure by the Corporation, the
Stockholder, or the successors or personal representative of the Stockholder's
estate to take any action within any time period prescribed by this Agreement
shall render the Common Stock of the Corporation transferable other than in
conformance with the provisions of this Agreement or preclude the Corporation
from exercising its right to purchase or cancel any such Common Stock.
(15) Binding Effect. This Agreement is binding on the Stockholder's
transferees, pledgees, heirs, successors, personal representatives, and
assigns, and upon the successors and assigns of the Corporation.
(16) Severability. If any portion of this Agreement is held invalid,
that invalidity shall not affect the remaining portions which can be given
effect without the invalid portion.
(17) Suspension of Repurchase Duties. Article Sixth, subparagraph
(D)(8) of the Certificate provides that the Board may suspend the
Corporation's obligation to repurchase Common Stock for a period of not longer
than 365 days.
(18) Restated Certificate of Incorporation. The Corporation's
Certificate contains additional restrictions which may apply to the
Stockholder, the terms and conditions of which are incorporated herein by this
reference. The parties agree that, if the provisions of the Certificate,
including any amendments that may be adopted subsequent to the date of this
Agreement, are more restrictive than the provisions of this Agreement, the
more restrictive provisions of the Certificate shall prevail.
***
WITNESS:
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Stockholder
ATTEST:
XXXXX XXXXXX SONS', INC.
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Assistant Secretary President
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