EXHIBIT 4
XXXXX HOLDING CORP.
AMENDED AND RESTATED SHAREHOLDER'S AGREEMENT
THIS AMENDED AND RESTATED SHAREHOLDER'S AGREEMENT (this "Agreement") is
made this 30th day of June, 2003, by and among Xxxxx Xxxxx, ("Xxxxx"), Xxxxx
Holding Corp. ("RHC"), a California corporation, Xxxxxx Xxxx Xxxxx, Xxxxxxx
Xxxxxx Xxxxx, and RAM Investments (Xxxxx Xxxxx as Trustee), a trust formed under
the laws of the State of California.
WITNESSETH:
WHEREAS, RHC has authorized capital stock consisting of 100,000,000
shares of common stock, no par value (the "Common Stock"), of which the
following shares of Common Stock are currently issued, outstanding and owned
beneficially by Xxxxx as follows:
Shareholder Shares
----------- ------
RAM Investments 11,292,622
(Xxxxx Xxxxx as Trustee)
WHEREAS, the parties hereto believe that the execution of this
Agreement will facilitate the continuous, harmonious and effective management of
the affairs, policies, and operations of RHC;
WHEREAS, the parties intend to allow RHC to purchase shares of Common
Stock owned beneficially by Xxxxx upon her death;
WHEREAS, the parties intend to allow Xxxxx'x representatives to sell
shares of Common Stock owned beneficially by Xxxxx to RHC upon her death;
WHEREAS, the parties believe that the restrictions that this Agreement
places upon Xxxxx'x shares combined with the number of shares that she controls
entitles her to receive additional consideration if RHC repurchases them;
WHEREAS, the parties have entered into the Xxxxx Holding Corp.
Shareholder's Agreement, dated May 27, 1998 (the "Shareholder's Agreement"); and
WHEREAS, the parties hereto have agreed that the Shareholder's
Agreement be amended and restated as set forth herein.
NOW, THEREFORE, in consideration of the mutual covenants and promises
set forth in this Agreement and other good and valuable consideration, the
sufficiency and receipt of which is hereby acknowledged, the parties agree as
follows:
1. Insurance.
RHC shall make application for, take out and maintain in effect such
insurance policies on the life of Xxxxx whenever and in such amounts as, in the
opinion of the Board of Directors of RHC, may be required to fulfill its
obligations under Section 2 and 3 of this Agreement. Such insurance shall be
listed in the Life Insurance Schedule attached hereto as Schedule A and
incorporated by reference herein (such policies are hereinafter collectively
referred to as the "Life Policies"). RHC shall maintain such Life Policies in
full force and effect and shall not, without the prior written consent of Xxxxx,
cancel any Life Policy or take or omit to take any action which might give rise
to the termination or cancellation thereof. RHC shall pay all premiums on all
Life Policies carried by it
pursuant to this Agreement as such premiums become due and shall, upon written
notice from Xxxxx, give due proof of such payment to Xxxxx within five days
after receipt of such written notice. If any premium on any such Life Policy is
not paid within 20 days after its due date, Xxxxx may pay or cause to be paid
the premium on such Life Policy and shall be entitled to reimbursement from RHC
therefor. RHC may apply any dividends declared on any Life Policies to the
payment of premiums.
2. Option to Sell upon Death.
2.1. Upon the death of Xxxxx (the "Decedent"), the Decedent's
personal representative(s) and/or trustee(s) of trust(s) created during Xxxxx'x
lifetime (collectively, the "Representatives") shall have the right (but not the
obligation) to sell, at their option, all or a portion of the shares of Common
Stock of RHC owned of record and beneficially by the Decedent at the time of her
death (the "Decedent Shares") or that were transferred by Xxxxx during her
lifetime to trust(s) (the "Trust Shares"). Upon receipt of notice from one or
more of the Decedent's Representatives of their intent to sell a portion of the
Decedent Shares and/or Trust Shares to RHC, RHC shall purchase such number of
Decedent Shares and/or Trust Shares that the Representatives elect to sell. RHC
shall by written notice addressed to the Representatives fix a closing date (the
"Decedent Closing Date") for the purchase of such number of the Decedent Shares
and/or Trust Shares. The Decedent Closing Date shall not be less than ten days
after the appointment of such Representatives or notification to the trustee(s),
whichever event is earliest, nor more than six months after RHC receives the
notice of intent to sell. RHC shall purchase and the Representatives shall sell
such number of the Decedent Shares and/or Trust Shares on the Decedent Closing
Date at a price per share (the "Decedent Purchase Price") which shall be 125% of
the Stated Value (as defined in Section 4 of this Agreement) per share of the
Decedent Shares or as otherwise determined pursuant to Section 4 of this
Agreement.
2.2. The dollar amount of the Decedent Purchase Price
multiplied by the number of Decedent Shares so owned by the Decedent at the date
of death of the Decedent and/or Trustee Shares (the "Aggregate Decedent Purchase
Price") shall be paid in cash on the Decedent Closing Date to the extent of the
cash proceeds received by RHC under the Life Policies insuring the life of the
Decedent (the "Insurance Proceeds") and neither the Decedent nor her
Representatives shall have any right, title or interest in or to any Insurance
Proceeds in excess of the Decedent Purchase Price. In the event that the
Aggregate Decedent Purchase Price shall exceed the dollar amount of Insurance
Proceeds (the "Decedent Insurance Purchase Price Cash Shortfall"), RHC shall pay
the Decedent Insurance Purchase Price Cash Shortfall in cash.
3. Option to Purchase upon Death.
3.1. Upon the death of Xxxxx, RHC shall have the right (but
not the obligation) to buy, at its option, all or a portion of the Decedent
Shares or the Trust Shares. Upon receipt of notice from the Company of its
intent to buy all or a portion of the Decedent Shares and/or Trust Shares, the
Representatives shall sell such number of Decedent Shares and/or Trust Shares
that RHC elects to buy. RHC shall by written notice addressed to the
Representatives fix a closing date (the "Company Closing Date") for the purchase
of such number of the Decedent Shares and/or Trust Shares. The Company Closing
Date shall not be less than ten days after the appointment of such
Representatives or notification to the trustee(s), whichever event is earliest,
nor more than six months after the first Representative receives the notice of
RHC's intent to buy. The Representatives shall sell and RHC shall purchase such
number of the Decedent Shares and/or Trust Shares on the Company Closing Date at
the Decedent Purchase Price which shall be 125% of the Stated Value (as defined
in Section 4 of this Agreement) per share of the Decedent Shares or as otherwise
determined pursuant to Section 4 of this Agreement.
3.2. The dollar amount of the Aggregate Decedent Purchase
Price shall be paid in cash on the Company Closing Date to the extent of the
cash proceeds received by RHC under the Insurance Proceeds and neither the
Decedent nor her Representatives shall have any right, title or interest in or
to any Insurance Proceeds in excess of the Decedent Purchase Price. In the event
that the Aggregate Decedent Purchase Price shall exceed the Decedent Insurance
Purchase Price Cash Shortfall, RHC shall pay the Decedent Insurance Purchase
Price Cash Shortfall in cash.
2
4. Stated Value.
RHC issues a Stated Value every six months. The "Stated Value" is the
value of the Company's Series A Non Redeemable common stock as determined by an
independent appraiser for financial reporting purposes. The Stated Value shall
be determined based on a discounted cash flow approach after consideration of
outstanding options and with the recognition of a marketability discount of 35%.
If RHC fails to give a Stated Value for six months, the Stated Value shall be
107.5% of the previous Stated Value or the fair market value (whichever is
greater).
5. Delivery of Certificates.
On the Decedent Closing Date or the Company Closing Date (the
"Closing"), the purchase by RHC of the Shares shall take place at 10:00 a.m. at
a location designated by RHC. At the Closing, the stock certificate or
certificates representing the Shares shall be delivered to RHC duly endorsed in
blank, and RHC shall pay the Aggregate Decedent Purchase Price therefor in cash.
6. Termination.
This Agreement shall be perpetual until the happening of the first of
any of the events listed below:
6.1. An agreement in writing prior to the death of Xxxxx
between RHC and Xxxxx to terminate this Agreement.
6.2. The dissolution of RHC prior to the death of Xxxxx.
6.3. The consummation prior to the death of Xxxxx of a merger,
consolidation or share exchange whereby RHC is not the surviving or successor
corporation.
6.4. The adjudication prior to the death of Xxxxx of RHC as
bankrupt, the execution prior to the death of Xxxxx by RHC of an assignment for
the benefit of creditors, or the appointment prior to the death of Xxxxx of a
receiver for RHC.
6.5. One year elapses after the death of Xxxxx.
7. Notices. All notices and other communications under this Agreement
shall be in writing and shall be given and deemed to be received when
hand-delivered and a signed receipt is given therefor or mailed registered or
certified U.S. mail, return receipt requested, postage prepaid, and addressed to
RHC at 0000 Xxxxxx Xxxxxx, Xxxxxxxx, Xxxxxxxxxx 00000; to Xxxxx Xxxxx at 000
Xxxxx Xxxxxx Xxxx, Xxxxxxxx, Xxxxxxxxxx 00000; to RAM Investments at 000 Xxxxx
Xxxxxx Xxxx, Xxxxxxxx, Xxxxxxxxxx 00000; to Xxxxxx Xxxx Xxxxx at 00 Xxxxxx Xxxx,
Xxxxxx, Xxxxxxxxxx, 00000; and to Xxxxxxx Xxxxxx Xxxxx at 000 Xxxxx Xxxxxx Xxxx,
Xxxxxxxx, Xxxxxxxxxx 00000.
8. Additional Actions and Documents. Each of the parties hereto agrees
to take or cause to be taken such further actions as are necessary to execute,
acknowledge, seal and deliver or cause to be executed, acknowledged, sealed and
delivered such further instruments and documents as are necessary and to use
her/its reasonable efforts to obtain such requisite consents as any other party
may from time to time reasonably request to fully effectuate the purposes and
fulfill the content of this Agreement.
9. Insertion in Will. Xxxxx agrees to insert in her will, or to execute
a codicil thereto, a provision directing and authorizing her personal
representatives to fulfill and comply with the terms, provisions and conditions
of this Agreement and to sell and transfer shares of Common Stock held by her
beneficially or of record in accordance herewith.
10. Transfer of Shares. The parties agree that Xxxxx'x shares may be
transferred as security for any transaction (provided that if RHC elects to
purchase the shares, the proceeds must first be used to pay the debt with the
balance being paid to the certificate holder) or transferred to any trust or
estate planning vehicle with fifteen days
3
notice to the parties without being bound by the restrictions contained herein.
However, when Xxxxx dies, Xxxxxxx Xxxxxx Xxxxx and Xxxxxx Xxxx Xxxxx agree to be
bound by the terms and conditions contained in this Agreement as to any stock of
RHC that they own at Xxxxx'x death.
11. Miscellaneous.
11.1. This instrument contains the entire, integrated
agreement among the parties and supersedes all prior oral or written agreements,
commitments or understandings with respect to the matters provided for herein,
and no modification shall be binding upon the party affected unless set forth in
writing and duly executed by each party to this Agreement.
11.2. Xxxxx represents and warrants: that she is the sole
beneficial owner of the number of shares of the Common Stock as set forth
immediately above her signature hereto, evidenced by the certificate numbers
shown immediately after such number of shares; that all of such shares are free
and clear of any and all liens, claims, charges, security interests or
encumbrances of any kind except as reflected by any endorsements on the
certificates; and that she has the full and entire right, power and authority to
sell or otherwise transfer such shares in accordance with the terms, provisions
and conditions of this Agreement. Xxxxx, however, discloses that the shares are
subject to a contract between Xxxxx and Xxxxx Xxxxx, Xx. which requires her to
vote her shares to elect him as a director if he instructs her to do so.
11.3. All of the covenants and agreements in this Agreement by
or on behalf of any of the parties hereto shall bind and inure to the benefit of
their respective heirs, guardians, personal and legal representatives,
successors and permitted assigns.
11.4. This Agreement shall be construed and enforced in
accordance with, and the rights of the parties shall be governed by, the laws of
the State of California, without giving effect to the conflict of laws rules of
the State of California.
11.5. In the event that one or more of the provisions of this
Agreement shall be invalid, illegal, or unenforceable in any respect, the
validity, legality and enforceability of the remaining provisions contained
herein shall not in any way be affected or impaired thereby.
11.6. In the event of a breach of this Agreement, any
nonbreaching party hereto may maintain an action for specific performance
against the party or parties hereto who are alleged to have breached any of the
terms, conditions, representations, warranties, provisions, covenants or
agreements herein contained, and it is hereby further agreed that no objection
to the form of action in any proceeding for specific performance of this
Agreement shall be raised by any party hereto so that such specific performance
of this Agreement may not be obtained by the aggrieved party. Anything contained
herein to the contrary notwithstanding, this Section 11.6 shall not be construed
to limit in any manner whatsoever any other rights and remedies an aggrieved
party may have by virtue of any breach of this Agreement.
11.7. The descriptive headings of the several sections and
paragraphs of this Agreement are inserted for convenience only and do not
constitute a part of this Agreement.
11.8. Unless the context otherwise requires, whenever used in
this Agreement, the singular shall include the plural, the plural shall include
the singular, and the masculine gender shall include the neuter and feminine
gender, and vice versa.
11.9. This Agreement may be executed in counterparts, each of
which shall be an original, but all of which shall together constitute one
document.
4
[signatures on the following page]
5
IN WITNESS WHEREOF, the patties hereunto have executed, sealed and
delivered this Agreement on the date first written above.
Number of Certificate
Shareholder Shares owned Number(s)
----------- ------------ ---------
RAM Investments 11,292,622 RHA 0417
(Xxxxx Xxxxx Trustee)
XXXXX HOLDING CORP. XXXXX XXXXX
BY: /s/ R. Xxxxxxx Xxxxx BY: /s/ Xxxxx Xxxxx
---------------- ---------------
R. Xxxxxxx Xxxxx Title: President Xxxxx Xxxxx
XXXXXXX XXXXXX XXXXX
BY: /s/ Xxxxxxx Xxxxxx Xxxxx
-------------------------
XXXXXX XXXX XXXXX Xxxxxxx Xxxxxx Xxxxx
BY: /s/ Xxxxxx Xxxx Xxxxx
----------------------
Xxxxxx Xxxx Xxxxx
RAM INVESTMENTS, XXXXX XXXXX AS TRUSTEE
BY: /s/ Xxxxx Xxxxx as Trustee
--------------------------
Xxxxx Xxxxx as Trustee
6
Schedule A
1. $14 million face amount with Indianapolis Life Insurance Company.
Issued July 15, 1998, expires July 15, 2043 (age 95). 10 year level
term. Policy # 000100038622. Xxxxx Xxxxx Insured, Beneficiary - Xxxxx
Holding Corp.
2. $15 million face amount with Security-Connecticut Life Insurance
Company, Issued November 8, 2000, expires November 8, 2043. 5 year
level term. Policy # 2433369K. Xxxxx X Xxxxx Insured, Beneficiary Xxxxx
Holding Corp.
