STOCKHOLDERS AGREEMENT
Exhibit
2.2
THIS STOCKHOLDERS AGREEMENT (the
“Agreement”) is made and entered into as of June 16, 2008 by and among MXL
Operations, Inc., a Pennsylvania corporation (the “Company”), MXL Industries,
Inc., a Delaware corporation (“Stockholder A”) and Xxxxxxx X. Xxxx, Xxxx X.
Xxxxx, Xxxxx X. Xxxxxx, Xxxxxxxx X. Xxxxxxx, and Xxxxxx Holdings, LLC (the
“Other Company Stockholders”).
WHEREAS, in connection with the sale to
the Company of the certain portions of the Business (as that term is defined in
that certain Asset Purchase Agreement of even date herewith) Stockholder A has
purchased and the Company has issued 2,000 shares of the Class B Common Stock of
the Company (the “Shares”), constituting 40.95% of the issued and outstanding
Common Stock of the Company, to Stockholder A.
WHEREAS, in connection with the
acceptance of the Shares by Stockholder A, the Company has agreed to register
the Shares upon the terms and conditions set forth herein and the Other Company
Stockholders have agreed to the conditions contained herein.
NOW, THEREFORE, in consideration of the
premises and the mutual promises herein made, and in consideration of the
representations, warranties and covenants herein contained, the Parties agree as
follows:
Section
1
Definitions.
“Account” shall mean an individual
retirement account of an Employee Stockholder under an Eligible Retirement
Plan.
“Affiliate” shall have the meaning set
forth in Rule 12b-2 of the regulations promulgated under the Exchange Act and
shall also include the heirs and legal representatives of any non-corporate
Party.
“Bank Agreement” shall mean the Credit
Agreements dated June 19, 2008 by and between the Buyer Entities and Union
National Community Bank, as amended from time to time.
“Buyer Entities” shall mean the
Company, MXL Leasing, LP and MXL Realty, LP.
“Code” shall mean the Internal Revenue
Code of 1986, as amended.
“Common Stock” shall mean the issued
and outstanding shares of Class A and Class B common stock of the Company in the
aggregate without regard to the Voting Rights Differences.
“Eligible Retirement Plan” shall mean
any individual retirement account described in Code §408(a), an individual
retirement annuity described in Code §408(b), a qualified trust described in
Code §401(a), an annuity plan described in Code §403(a), or an annuity contract
described in Code §403(b).
“Employee Stockholders” shall mean
Xxxxxxx X. Xxxx, Xxxxx X. Xxxxxx, Xxxxxxxx X. Xxxxxxx, Xxxx X. Xxxxx, and any
other person admitted as an Employee Stockholder of the Company in accordance
with this Agreement.
“Encumbrances” shall mean any mortgage,
pledge, lien, charge, security or other third party interest.
“ERISA” shall mean the Employee
Retirement Income Security Act; as amended and al rules and regulations
promulgated thereunder.
“Exchange Act” shall mean the
Securities Exchange Act of 1934; as amended and all rules and regulations
promulgated thereunder.
“Fair Market Value” shall, solely for
purposes of Section 7, mean, as of any date of determination, with respect to
the Common Stock of any Other Company Stockholder, the Other Company
Stockholder’s Percentage Interest multiplied by the net book value of the
Company as shown on the balance sheet of the Company for the most recently
completed fiscal year of the Company as determined by the Company’s
regularly-employed independent certified public accountants, adjusted to reflect
all profits, losses, results of operation, contributions and other adjustments
required by generally accepted accounting principles since the end of such
fiscal year to the date of valuation; provided, however,
that the fair market value of any real estate or equipment owned by the Company
shall be substituted for the book value of the real estate or
equipment. In determining the fair market value of real estate or
equipment, the Company’s accountants shall use either the Company’s lender’s
appraiser or shall select a qualified appraiser, which appraiser may be a
qualified appraiser who is part of or affiliated with the Company’s independent
accounting firm so long as the Company’s accountant reasonably believes such
appraiser can perform his appraisal without bias for or against any involved
Person. If the Company has an appraisal (including for banking
purposes) not more than eighteen (18) months old, such appraisal may be used in
the accountant’s discretion. The fees and expenses incurred in
connection with the appraiser’s determination of fair market value of the real
estate and equipment shall be paid by the Company.
“Indebtedness” shall mean obligations
for borrowed money.
“Percentage Interest” of each
Stockholder shall be based upon the ownership of the Class A and Class B Common
Stock of the Company considered as a single class, as reflected on the books and
records of the Company and without regard to the Voting Rights
Differences.
“SEC” means the US Securities and
Exchange Commission.
“Selling Expenses” shall mean all
underwriting discounts and selling commissions applicable
to a sale of Shares.
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“Securities Act” shall mean the
Securities Act of 1933; as amended and all rules and regulations promulgated
thereunder.
“Stockholders” shall mean Stockholder
A, the Other Company Stockholders and any other person who becomes the owner of
Common Stock in compliance with the terms of this Agreement.
“Voting Rights Differences” shall mean
the fact that Class A Common Stock is entitled to one vote per share on all
matters as to which a stockholder vote is required or permitted under this
Agreement or any applicable law while Class B Common Stock is not entitled to
vote with respect to any such matter.
“Stock Holding Period” shall mean the
period commencing on the date of this Agreement and ending on the date upon
which Stockholder A no longer has beneficial ownership of any of the Shares or
equity securities into which the Shares have been converted.
Section
2
Representations and
Warranties of the Company and the Other Company Stockholders.
(a) The
Company represents and warrants to Stockholders as follows:
(i) The
Company is a corporation duly organized and validly existing under the laws of
the Commonwealth of Pennsylvania and is in good standing under the laws of such
jurisdiction. The Company has the requisite corporate power to own
and operate its property and assets and to carry on its business as presently
conducted or as proposed to be conducted.
(ii) All
corporate action on the part of the Company necessary for the authorization,
execution, delivery and performance of this Agreement and the authorization,
sale, issuance and delivery of the Shares has been duly and validly
taken. The Shares are validly issued, fully paid and
non-assessable. The issuance of the Shares does not give rise to any
preemptive rights or rights of first refusal on behalf of any
person.
(iii) The
execution and delivery of this Agreement, and the performance and consummation
of the transactions contemplated hereby, will not conflict with, or result in
any violation of, or default under, or give rise to an acceleration of any
obligation or the loss of a material benefit under, any other agreement or
instrument applicable to the Company or its properties or materially impair or
restrict the Company’s power to perform its obligations as contemplated by this
Agreement.
(iv) The
authorized equity securities of the Company consist of 50,000 shares of Class A
Common Stock with no par value, and 50,000 shares of Class B Common Stock, with
no par value; of which 6 shares of Class A Common Stock and 4,878 shares of
Class B Common Stock are duly issued and outstanding, and owned of record and
beneficially as set forth on Exhibit A
hereto. The privileges, rights and interest represented by
each issued and outstanding share of Class A Common Stock and Class B Common
Stock, including without limitation the right to receive dividends or
distributions of any kind, is identical in all respects except for the Voting
Rights Differences. Each of the Other Company Stockholders are the
record and beneficial owners and holders of the shares owned by each of them,
free and clear of all encumbrances. Except as set forth in this
Agreement or the Put and Call Agreement, there are no contracts relating to the
issuance, sale or transfer of any equity securities or other securities of the
Company. None of the outstanding Common Stock was issued in violation
of the Securities Act or any other legal requirement. The Certificate
of Incorporation and Bylaws of the Company are attached hereto as Exhibit
B.
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(v) There
are no contracts, understandings, courses of dealings, obligations, rights or
liabilities (whether or not evidenced in writing) by and between the Company and
the Other Company Stockholders, or their Affiliates, in connection with the
Common Stock other than as contained in this Agreement and in the Put and Call
Agreement.
(b) Each
Other Company Stockholder individually warrants to the Company and Stockholder A
as follows:
(i) To
the extent applicable, all action on the part of the Other Company Stockholder
necessary for the authorization, execution, delivery and performance of this
Agreement has been duly and validly taken.
(ii) The
execution and delivery of this Agreement, and the performance and consummation
of the transactions contemplated hereby, will not conflict with, or result in
any violation of, or default under, or give rise to an acceleration of any
obligation or the loss of a material benefit under, any other agreement or
instrument applicable to the Other Company Stockholder or its properties or
materially impair or restrict the Other Company Stockholder’s power to perform
its obligations as contemplated by this Agreement.
(iii) The
Other Company Stockholder understands that (i) the Shares are “restricted
securities” under the Securities Act and may not be resold without either
registration or an applicable exemption from registration under the Securities
Act and (ii) the Company is under no obligation to register the Shares except to
the extent provided in this Agreement.
(iv) Each
of the Other Company Stockholders are the record and beneficial owners and
holders of the shares owned by each of them, free and clear of all
encumbrances. Except as set forth in the this Agreement or Put and
Call Agreement, there are no contracts relating to the issuance, sale or
transfer of any equity securities or other securities of the
Company.
(v) There
are no contracts, understandings, courses of dealings, obligations, rights or
liabilities (whether or not evidenced in writing) by and between the Company and
the Other Company Stockholders, or their Affiliates, in connection with the
Common Stock other than as contained in this Agreement and in the Put and Call
Agreement.
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Section
3
Representations and
Warranties of Stockholder A.
Stockholder
A represents and warrants to the Company and the Other Company Stockholders as
follows:
(a) Stockholder
A is a corporation duly organized and validly existing under the laws of the
State of Delaware and is in good standing under the laws of such
jurisdiction. Stockholder A has the requisite corporate power to own
and operate its property and assets and to carry on its business as presently
conducted or as proposed to be conducted.
(b) All
corporate action on the part of Stockholder A necessary for the authorization,
execution, delivery and performance of this Agreement has been duly and validly
taken.
(c) The
execution and delivery of this Agreement, and the performance and consummation
of the transactions contemplated hereby, will not conflict with, or result in
any violation of, or default under, or give rise to an acceleration of any
obligation or the loss of a material benefit under, any other agreement or
instrument applicable to Stockholder A or its properties or materially impair or
restrict Stockholder A’s power to perform its obligations as contemplated by
this Agreement.
(d) Stockholder
A is an “accredited investor” within the meaning of Regulation D promulgated
under the Securities Act.
(e) Stockholder
A understands that (i) the Shares are “restricted securities” under the
Securities Act and may not be resold without either registration or an
applicable exemption from registration under the Securities Act and (ii) the
Company is under no obligation to register the Shares except to the extent
provided in this Agreement.
Section
4 Tag-Along
Rights.
(a) Subject
to Section 4 (f), prior to the end of the Stock Holding Period, the Other
Company Stockholders agree that they shall not, directly or indirectly, sell or
otherwise dispose of any shares of Common Stock unless the terms and conditions
of such sale or other disposition shall include an offer to Stockholder A by the
third party purchasing such shares to include, at the option of Stockholder A,
the purchase by said third party of the Shares on the same terms and conditions;
and without regard for the Voting Rights Differences. In the event
the Other Company Stockholders are selling less than all of the shares of Common
Stock held by them, the obligation to obtain an offer from the third party for
the Shares under the previous sentence shall be limited to a percentage of the
Shares equal to the percentage of the total number of shares of Common Stock
held by the Other Company Stockholders (computed in the aggregate) which are
being sold or otherwise disposed of to said third party.
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(b) The
Other Company Stockholders, or any one or more of them, that intends to accept
an offer to sell or otherwise dispose of any of their shares of Common Stock
under Section 4 (a) shall immediately give notice to Stockholder
A. Such notice shall be accompanied by a true and correct copy of the
third party offer which identifies the third party, the number of shares the
third party intends to purchase or otherwise acquire from the Other Company
Stockholders, the price and other terms and conditions of the offer to the Other
Company Stockholders and a binding commitment from the third party to purchase
the Shares to the extent required by Section 4 (a) above. Stockholder
A shall have 15 business days to accept the third party offer with respect to
the Shares. If Stockholder A accepts the offer, the sale and
purchase of the Shares shall take place concurrently with the related sale and
purchase by the Other Company Stockholders. If Stockholder A does not
accept the offer within the time limit contained in this Section 4 (b), all
rights to sell Shares to the third party shall be deemed to have been waived;
provided that said sale of other disposition of shares by the Other Company
Stockholders takes place on the terms set forth in the aforesaid notice within
30 business days after the last day on which Stockholder A could have accepted
such third party offer. In the event the third party shall
amend its offer, Stockholder A shall receive a notice disclosing such amendment
and the offer required by Section 4 (a) above shall be amended identically and
remain open for acceptance for 15 business days from the date notice of such
amendment is received by Stockholder A.
(c) If
Stockholder A shall have accepted the offer of the third party with respect to
the Shares under this Section 4, the sale of the Shares and the Common Stock
being sold by the Other Company Stockholders shall take place
contemporaneously. If for any reason, the third party fails or
refuses to purchase the Shares to the full extent required to be purchased
pursuant hereto, the Other Company Stockholders shall not sell or otherwise
dispose of any of their shares of common stock of the Company.
(d) If
one or more of the Other Company Stockholders are permitted by this Section 4 to
sell some or all of their shares of Common Stock, in a transaction which will
not cause the Stock Holding Period to end contemporaneously with the
consummation of such transaction, the Other Company Stockholder(s) may only sell
such shares of common stock if the purchaser(s) thereof agrees in writing to be
bound by the terms of this Agreement.
(e) The
Company and its transfer agent are hereby authorized and directed to refuse to
record on the books of the Company or otherwise recognize for any purpose any
transfer of its common stock which does not comply with the terms of this
Section 4.
(f) The
provisions of this Section 4 shall not be applicable to a sale or other disposal
of shares of the Common Stock by the Other Company Stockholders (i) to one or
more Affiliates (providing that such Affiliates agree to be bound by the terms
of this Agreement as an “Other Company Stockholder”) or (ii) in a transaction
subject to Section 5 below.
Section
5 Registration
Rights.
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Section
5 Registration
Rights.
(a) The
Company shall notify Stockholder A at least 15 business days prior to the filing
of any registration statement under the Securities Act for a public
offering of securities of the Company (including, but not limited to,
registration statements relating to secondary offerings of securities of
the Company) and will afford Stockholder A an opportunity to include in such
registration statement all or part of the Shares. Such notice
shall (i) offer Stockholder A the opportunity to register such number of
Shares as it may request and (ii) describe such securities and specify
the form and manner and other relevant facts involved in such proposed
registration (including, without limitation, if known, the price at which
such securities are reasonably expected to be sold to the public, whether
or not such registration will be in connection with an underwritten
offering and, if so, the identity of the managing underwriter, whether such
underwritten offering will be pursuant to a "best efforts" or "firm
commitment" underwriting, and the amount of the underwriting discount reasonably
expected to be incurred in connection therewith). If Stockholder A
desires to include in any such registration statement all or part of the
Shares, it shall, within 15 business days after receipt of the
above-described notice from the Company, so notify the Company in
writing. Such notice shall state the number of Shares which Stockholder A
requests to be included in such registration and its intended method
of disposition of the Shares. If Stockholder A decides not to
include all of its Shares in any registration statement filed by the
Company, it shall nevertheless continue to have the right to include any Shares
in any subsequent registration statement or registration statements as may
be filed by the Company, all upon the terms and conditions set forth herein and
the rights contained in the Put and Call Agreement and Section 4 shall continue
to apply with respect to any Shares continued to be held by Stockholder
A.
(b) If
the registration statement under which Stockholder A gives notice under
this Section 5 is for an underwritten offering, Stockholder A's
right to be included in a registration pursuant to this Section 5 shall be
conditioned upon its participation in the underwriting and its
entering into an underwriting agreement in customary form with the
underwriter or underwriters selected for such underwriting by the Company.
Notwithstanding any other provision of this Section 5, if the underwriter
determines in good faith that marketing factors require a limitation of the
number of securities to be underwritten (including the Shares), then the
Company shall so advise Stockholder A, and the number of securities that
may be included in the underwriting shall be allocated on a pro rata basis
based on the total number of Shares requested to be sold by Stockholder A and
the total number of shares of common stock of the Company requested to be sold
by the Company and the Other Company Stockholders. If Stockholder A
disapproves of the terms of any such underwriting, it may elect to withdraw
therefrom by written notice to the Company and the underwriter, delivered
at least 10 business days prior to the effective date of the registration
statement. Any Shares excluded or withdrawn from such underwriting shall be
excluded and withdrawn from the registration.
(c) The
Company shall have the right to terminate or withdraw any registration
initiated by it under this Section 5 prior to the effectiveness of such
registration whether or not Stockholder A has elected to include securities
in such registration.
(d) All
expenses incurred in connection with any registration pursuant to Section 5
shall be borne by the Company, except Selling Expenses, which shall be
borne by the holders of the securities so registered pro rata on the basis
of the number of shares so registered.
(e) Whenever
registering any Shares, the Company shall, as expeditiously as reasonably
possible:
(i) Prepare
and file with the SEC a registration statement with respect to such Shares and
use its commercially reasonable efforts to cause such registration
statement to become effective.
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(ii) Prepare
and file with the SEC such amendments (including post-effective amendments
and supplemental opinions of counsel, if required) and supplements to such
registration statement and the prospectus used in connection with
such registration statement as may be necessary to comply with the
provisions of the Securities Act with respect to the disposition of all
securities covered by such registration statement for a commercially
reasonable period.
(iii) Use
its commercially reasonable efforts to register and qualify the Shares covered
by such registration statement under such other securities or Blue Sky laws
of such jurisdictions as Stockholder A shall reasonably request, and do any
and all other acts and things which may be reasonably necessary or
advisable to enable Stockholder A to consummate the disposition of the Shares in
such jurisdictions.
(iv) Notify
Stockholder A, at any time when a prospectus relating to the Shares is required
to be delivered under the Securities Act, of the happening of any event as
a result of which the prospectus included in such registration statement,
as then in effect, includes an untrue statement of a material fact or omits
to state a
material
fact required to be stated therein or necessary to make the
statements
therein
not misleading in the light of the circumstances then existing.
(v) Within
a reasonable time before each filing of the registration statement or any
amendment or supplement thereto with the SEC, furnish to Stockholder
A’s counsel copies of such documents proposed to be filed,
which documents shall be subject to the reasonable approval of such
counsel, and further to provide such counsel any financial or other records as
shall be necessary for such counsel to assist Stockholder A in exercising its
due diligence with respect to the contents of the registration
statement.
(vi) Use
its commercially reasonable efforts to prevent the issuance of any
order suspending the effectiveness of a registration statement and, if one
is issued, immediately notify Stockholder A of the receipt of such notice
and use its commercially reasonable efforts to obtain the withdrawal of any
order suspending the effectiveness of a registration statement at the
earliest possible moment.
(vii) Otherwise
use its commercially reasonable efforts to cooperate with the SEC and other
regulatory agencies and take all reasonable actions and execute and deliver
or cause to be executed and delivered all documents reasonably necessary to
effect the registration of any securities under this Agreement.
(viii) Provide
a transfer agent and registrar for all Shares not later than the effective date
of such registration statement.
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(ix) If
such registration involves an underwritten offering, obtain and furnish
a comfort letter, dated the effective date of such registration statement,
and the date of the closing under the underwriting agreement, signed by the
Company's independent public accountants and addressed to Stockholder A, in
customary form and covering such matters as are customarily covered by
comfort letters by independent public accountants in such public offerings
and such other financial matters as Stockholder A may reasonably
request.
(x) If
such registration involves an underwritten offering, furnish a
legal opinion of the Company's counsel, dated the date of the closing under
the underwriting agreement and addressed to Stockholder A, with respect to
the registration statement, each amendment and supplement thereto, the
prospectus included therein (including the preliminary prospectus) and
other documents relating thereto, in customary form and covering such
matters as are customarily covered by legal opinions of issuers' counsel in
such public offerings.
(xi) During
the period when a prospectus is required to be delivered under
the Securities Act, promptly file all documents required to be filed with
the SEC pursuant to Sections 13(a), 13(c), 14, or 15(d) of the Exchange
Act.
(f) It
shall be a condition precedent to the obligations of the Company to take
any action pursuant to Section 5 that Stockholder A shall furnish to the
Company such information regarding Stockholder A and the Shares as shall be
required to effect the registration of the Shares.
(g)
If any
Shares are included in a registration statement under this Section
5:
(i)
To the extent permitted by law, the Company will indemnify and hold harmless
Stockholder A, and its officers, directors, employees and agents, against any
losses, claims, damages, or liabilities (joint or several) to which they may become subject under the Securities Act, the
Exchange Act, or other federal or state law, insofar as such losses,
claims, damages, or liabilities (or actions in respect thereof) arise out
of or are based upon any of the following statements, omissions, or
violations (collectively a "Violation") by the Company: (A) any untrue
statement or alleged untrue statement of a material fact contained in such
registration statement, including any preliminary prospectus or
final prospectus contained therein or any amendments or supplements
thereto; (B) the omission or alleged omission to state therein a material
fact required to be stated therein, or necessary to make the statements
therein not misleading; or (C) any Violation or alleged Violation by the
Company of the Securities Act, the Exchange Act, or any state securities
law or any rule or regulation promulgated under the Securities Act, the
Exchange Act, or any state securities law in connection with the offering
covered by such registration statement; and, subject to subsection (iii)
below, the Company will pay as incurred to Stockholder A, its officers,
directors, employees or agents any legal or other expenses reasonably
incurred by them in connection with investigating or defending any such
loss, claim, damage, liability, or action.
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(ii) To
the extent permitted by law, Stockholder A will, if Shares are included in the
securities as to which such registration is being effected, indemnify and
hold harmless the Company, and its officers, directors, employees and agents, if
any, who control the Company within the meaning of the Securities Act,
against any losses, claims, damages, or liabilities (joint or several)
to which the Company or any such person may become subject under the
Securities Act, the Exchange Act, or other federal or state law, insofar as
such losses, claims, damages, or liabilities (or actions in respect
thereto) arise out of or are based upon any Violation, in each case to the
extent (and only to the extent) that such Violation occurs in reliance upon
and in conformity with written information furnished by Stockholder A
specifically for use in connection with such registration; and, subject to
subsection (iii) below, Stockholder A will pay as incurred any legal or
other expenses reasonably incurred by the Company or any such person
in connection with investigating or defending any such loss, claim,
damage, liability, or action if it is judicially determined that there was
such a Violation; provided that in no event shall any indemnity obligation of
Stockholder A under this Subsection (ii) exceed the net
proceeds received by Stockholder A from the sale of Shares pursuant to such
registration statement.
(iii) Promptly
after receipt by an indemnified party under this Section 5 (g) of notice of
the commencement of any action (including any governmental action), such
indemnified party will, if a claim in respect thereof is to be made
against any indemnifying party under this Section 6 (g), deliver to the
indemnifying party a written notice of the commencement thereof and the
indemnifying party shall have the right to participate in, and, to the
extent the indemnifying party so desires, jointly with any other
indemnifying party similarly noticed, to assume the defense thereof with
counsel mutually satisfactory to the parties; provided, however, that an
indemnified party shall have the right to retain its own counsel, with the
fees and expenses to be paid by the indemnifying party, if representation
of such indemnified party by the counsel retained by the indemnifying party
would be inappropriate due to actual or potential differing interests
between such indemnified party and any other party represented by
such counsel in such proceeding. The failure to deliver written notice to
the indemnifying party within a reasonable time of the commencement of any
such action, if materially prejudicial to its ability to defend such
action, shall relieve such indemnifying party of any liability to the
indemnified party under this Section 5 (g), but the omission so to deliver
written notice to the indemnifying party will not relieve it of any
liability that it may have to any indemnified party otherwise than under
this Section 5 (g).
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(iv) If
the indemnification provided for in this Section 5 (g) is held by a
court of competent jurisdiction to be unavailable to an indemnified party
with respect to any losses, claims, damages, or liabilities referred to
herein, the indemnifying party, in lieu of indemnifying such indemnified
party thereunder, shall to the extent permitted by applicable law
contribute to the amount paid or payable by such indemnified party as a
result of such loss, claim, damage, or liability in such proportion as is
appropriate to reflect the relative fault of the indemnifying party on the
one hand and of the indemnified party on the other in connection with the
Violation(s) that resulted in such loss, claim, damage, or liability, as
well as any other relevant equitable considerations. The relative fault of
the indemnifying party and of the indemnified party shall be determined by
a court of law by reference to, among other things, whether the untrue or
alleged untrue statement of a material fact or the omission to state
a material fact relates to information supplied by the indemnifying party
or by the indemnified party and the parties' relative intent, knowledge,
access to information, and opportunity to correct or prevent such statement
or omission; provided, that in no event shall any contribution by
Stockholder A hereunder exceed the net proceeds from the offering received
by Stockholder A. The parties hereto agree that it would not be just and
equitable if contributions pursuant to this Section 5 (g) were determined by pro
rata allocation or any other method of allocation which does not take into
account the equitable consideration referred to in this subsection
(iv).
(v) The
obligations of the Company and Stockholder A under this Section 5 (g) shall
survive completion of any offering of Shares in a registration statement and the termination of this Agreement. No indemnifying party,
in the defense of any such claim or litigation, shall, except with the
consent of each indemnified party, consent to entry of any judgment or enter
into any settlement which does not include as an unconditional term thereof
the giving by the claimant or plaintiff to such indemnified party of a
release from all liability in respect to such claim or
litigation.
(h) To
the extent, any of the Shares are sold by Stockholder A pursuant to this Section
5, prior to such sale the Company and the Other Company Stockholders
agree to take all action necessary to amend the provisions of the Company’s
Certificate of Incorporation to remove all Voting Rights Differences by giving
voting rights to Class B Common Stock equal to that held by Class A Common
Stock.
Section
6 Operations of the
Company.
(a) For
the duration of the Stock Holding Period, Stockholder A shall have the right to
designate one person (an “Advisory Director”) who shall receive notice of, and
be permitted to attend, all meetings of the Board of Directors of the Company,
and any committees of said Board of Directors and enter into all discussions
undertaken at such meetings. In addition, the Advisory Director shall
have the right to call meetings of the Board of Directors, add agenda items to
any such meeting of the Board of Directors and shall receive copies of any
proposed Board of Director statements of consent simultaneously with the members
of the Board of Directors. The Advisory Director shall have all of
the rights of a member of the Board of Directors except that he or she shall not
have a vote on any matter before the Board and shall not have any fiduciary duty
to the Company or the Stockholders. The indemnification
provisions contained in the Company’s Certificate of Incorporation and Bylaws
and the protection afforded by any insurance provided for the benefit of members
of the Board of Directors shall apply to the Advisory Director to the same
extent as applicable to the members of the Board of Directors.
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(b) The
Company will not take, and the Other Company Stockholders who hold or otherwise
have voting rights with respect to Class A Common Stock shall not vote such
shares of Class A Common Stock in favor or any of the following actions without
first receiving the written approval of Stockholder A and such other authority
as required by this Agreement, the Put and Call Agreement, the Certificate of
Incorporation or Bylaws of the Company or any applicable law:
(i)
Issuing, repurchasing, canceling or redeeming any security,
including any Indebtedness (other than the Bank Agreement or any other bank
agreements which in the aggregate do not exceed $500,000 and which do not
contain covenants or other restrictions on Stockholder A exercising its “put”
rights under the Put and Call Agreement which are more restrictive than those
contained in the Bank Agreement), any Indebtedness convertible into equity, or
any other form of equity in the Company other than options or other equity
interests issued under a plan approved pursuant to subsection (ii) below or as
permitted in Section 7.
(ii) Adoption
of any plan pursuant to which equity interests in the Company in an aggregate
amount equal to more than 10% of the Common Stock outstanding on the date hereof
may be granted to directors, officers or employees of the Company.
(iii) Any
amendment to the Company’s Certificate of Incorporation or Bylaws which would
alter or affect the capital structure or permitted capital structure of the
Company or could otherwise adversely affect the rights of Stockholder A or the
underlying value of the Shares.
(iv) Executing
or delivering any assignment for the benefit of creditors of the Company or the
filing of any voluntary petition in bankruptcy or receivership with respect to
the Company or taking actions to dissolve the Company.
(v) Selling
or otherwise disposing of any tangible or intangible assets, except in the
ordinary course of business, having a value, individually or in the aggregate
for any series of related transactions, in excess of $500,000 (provided that the
sale of real estate or equipment shall be considered in the ordinary course of
business and further provided that such sale is not to an Other Company
Stockholder or an Affiliate and the net proceeds for such sale are used to
purchase additional or replacement real estate or equipment to be utilized
exclusively by the Company or reduce indebtedness incurred to purchase such
additional or replacement real estate or equipment).
-12-
(vi)
Any transaction with the Other Company Stockholders or any of their Affiliates
having a value during any fiscal year which individually or in the aggregate
exceeds $50,000 except for compensation or other payments reasonably related to
the performance of the Company and said employee’s performance and, in any
event, reasonably based upon employee compensation for similarly situated
companies in industries reasonably related to the Business provided that this
subsection (vi) shall not apply to transactions with MXL Realty and/or MXL
Leasing.
(vii) The
purchase, lease or other acquisition of any tangible or intangible asset that
will not be used exclusively by the Company.
(c)
For the duration of the Stock Holding Period and for two years
thereafter, none of Stockholder A nor any of the Other Company Stockholders will
engage, directly or indirectly, in the manufacture, sale or distribution of
optical plastics molding or precision coating products which are competitive
with the products of the Company in any geographic area where the Business
operates.
(d)
All transactions between the Company and any one or both of
the other Buying Entities shall be at arms-length and, in the reasonable view of
the president of the Company, upon terms and conditions no less favorable to the
Company than could be obtained from an unaffiliated third party.
Section
7. Transfer of Common
Stock
(a) The
Stockholders shall not have the right to transfer their Common Stock except as
otherwise specifically provided in this Agreement or the Put and Call
Agreement. A transfer shall include a voluntary or involuntary sale,
exchange, assignment, gift, pledge, hypothecation, or other encumbrance or
disposition (hereinafter a “Transfer”). No transferee of Common Stock
shall have any rights as a stockholder of the Company, unless the Transfer was
made in accordance with this Agreement.
(i) THE
OWNERSHIP AND TRANSFERABILITY OF COMMON STOCK OF THE COMPANY ARE SUBSTANTIALLY
RESTRICTED. NEITHER RECORD TITLE NOR BENEFICIAL OWNERSHIP OF COMMON
STOCK MAY BE TRANSFERRED OR ENCUMBERED EXCEPT AS OTHERWISE SET FORTH IN THIS
AGREEMENT. THE COMPANY IS FORMED BY THOSE WHO KNOW AND TRUST ONE
ANOTHER, WHO HAVE SURRENDERED CERTAIN MANAGEMENT RIGHTS, OR WHO WILL HAVE
ASSUMED MANAGEMENT RESPONSIBILITY AND RISK BASED UPON THEIR RELATIONSHIP AND
TRUST. CAPITAL IS MATERIAL TO THE BUSINESS AND INVESTMENT OBJECTIVES
OF THE COMPANY. AN UNAUTHORIZED TRANSFER OF COMMON STOCK COULD CREATE
A SUBSTANTIAL HARDSHIP TO THE OTHER PARTIES TO THIS AGREEMENT,
JEOPARDIZE ITS CAPITAL BASE, AND ADVERSELY AFFECT ITS TAX
STRUCTURE. THE RESTRICTIONS UPON OWNERSHIP AND TRANSFER UNDER THIS
ARTICLE 7 ARE NOT INTENDED AS A PENALTY, BUT AS A METHOD TO PROTECT AND PRESERVE
EXISTING RELATIONSHIPS BASED UPON TRUST AND THE COMPANY'S CAPITAL AND ITS
FINANCIAL ABILITY TO CONTINUE. THEREFORE, THE STOCKHOLDERS AGREE THAT
NO STOCKHOLDER SHALL TRANSFER, OR PERMIT TO BE TRANSFERRED, ALL OR ANY PORTION
OF HIS RECORD TITLE OR BENEFICIAL INTEREST IN COMMON STOCK OF THE COMPANY
WHETHER NOW OR HEREAFTER ACQUIRED, EXCEPT IN ACCORDANCE WITH THE TERMS OF THIS
AGREEMENT OR WITH THE PRIOR WRITTEN CONSENT OF ALL OF THE PARTIES TO THIS
AGREEMENT.
-13-
(ii) Any
attempted Transfer of any Common Stock not in accordance with the terms of this
Agreement shall be null and void and shall not be reflected on the Company’s
books; provided, however, that, if the Company is required to recognize a
Transfer that is not otherwise permitted then, the interest so
Transferred shall be strictly limited to the transferor's rights to dividends
and other distributions with respect to the Transferred interest, which
distributions may be applied (without limiting any other legal or equitable
rights of the Company) to satisfy any debts, obligations, or liabilities for
damages that the transferor or transferee of such interest may have to the
Company.
(iii) Each party
to this Agreement hereby acknowledges the reasonableness of the restrictions on
Transfer imposed by this Agreement in view of the Company purposes and the
relationship of the parties hereto. Accordingly, the restrictions on
Transfer contained herein shall be specifically enforceable.
(b) Transfers
of Common Stock shall be subject to and made only in accordance with this
Section 4, Section 5 and Section 7 and any purported Transfer to the contrary
shall be null and void ab initio and shall not
be recognized by or binding upon the Company.
(i)
Stockholder A may transfer all or any part of its Shares only if the
transferee agrees in writing to be bound by this Agreement and the transferred
Shares remain subject to the rights of the Buyer Entities under the Put and Call
Agreement; provided that Stockholder A’s rights under Section 6 (a) and (b) and
the Put and Call Agreement shall terminate unless the Transfer is approved by
the holders of a majority of the Class A Common Stock. For purposes
of this Agreement, Stockholder A shall not be deemed to have transferred any
part of its Shares pursuant to any sale or transfer
involving (i) more than 50% of the outstanding voting power of Stockholder A;
(ii) all or a substantial part of the assets of Stockholder A; (iii) the merger
of Stockholder A with or into another entity; or (iv) a transaction with an
Affiliate of Stockholder A.
-14-
(ii)
An Other Company Stockholder may Transfer all, or any part of
his Common Stock if (A) the Transfer complies with Section 7 (e) of this
Agreement and the transferee agrees in writing to be bound by this Agreement; or
(B) such Other Company Stockholder shall have first obtained the written consent
to such Transfer from the holders of a majority of the Class A Common Stock (and
the holders of Class A Common Stock shall have complete discretion to approve or
disapprove of any such Transfer), and the transferee agrees in writing to be
bound by this Agreement; provided, however, that any
transfer permitted under (A) or (B) above shall also comply with Articles 4 or
5, to the extent applicable.
(iii) If
the transferee agrees in writing to be bound by this Agreement, an Other Company
Stockholder may Transfer all, or any part of his Common Stock, during life or at
death, by sale, gift, bequest or otherwise to (A) his spouse; (B) his issue; (C)
a trust, partnership or similar entity, if 80% or more of the beneficial
interests therein are owned by the Other Company Stockholder and/or persons
described in clauses (A) or (B) above; (D) a corporation, if 80% of the issued
and outstanding stock is owned by the Other Company Stockholder and/or persons
described in clauses (A) or (B) above; (E) his estate or (F) in the event the
Other Company Stockholder is an Eligible Retirement Plan, to (I) an Account in
any other Eligible Retirement Plan, (II) the participant/owner of the Account in
such Eligible Retirement Plan or (III) the beneficiary or beneficiaries of the
Account in such Eligible Retirement Plan provided that such beneficiary or
beneficiaries are persons described in clauses (A), (B), (C) or (D) above as
determined in relation to the participant/owner of the Account under such
Eligible Retirement Account, provided, however, that, after
the later of the date on which the Other Company Stockholder Transferring his
Common Stock under this subparagraph (iii) ceases to be either employed by any
Buyer Entity or serving in a material, advisory role to any Buyer Entity, any
Class A Common Stock of the Company acquired by a person under this subparagraph
(iii) shall be immediately converted to Class B Common Stock; provided that, if
by the operation of this subparagraph or otherwise there are no shares of Class
A Common Stock issued and outstanding, then the shares of Class B Common Stock
shall be entitled to one vote per issued and outstanding share. For
purposes this subparagraph (iii), any Common Stock held in an Account by an
Eligible Retirement Plan shall be deemed to have been transferred to such
Eligible Retirement Plan by the Employee Stockholder who is a participant in
such Eligible Retirement Plan and shall be subject to the limited rights set
forth in this subparagraph and, to the extent applicable, the provisions of
subparagraph 7 (f) (iv), after the later of the date on which the
participant ceases to be either employed by any Buyer Entity or serving in a
material, advisory role to any Buyer Entity.
(iv) All
Stockholders may transfer its Common Stock pursuant to Section 5 without
complying with Sections 4 or 7 and Stockholder A may transfer its Shares under
Section 4 without complying with Section 7.
-15-
(c) If
any person acquires Common Stock or becomes an assignee in violation of the
terms of this Agreement, as a result of an order of a court which the Company is
required by law to recognize, or if a party to this Agreement makes an
unauthorized transfer or assignment of Common Stock in violation of the terms of
this Agreement, which the Company is required to recognize, including a transfer
of a party's interest at death, the Company shall have the unilateral option to
acquire the interest of the transferee or assignee, or any fraction or part
thereof, upon the following terms and conditions:
(i)
The Company shall have the option to acquire the interest by giving notice
to the transferee or assignee of its intent to purchase within ninety (90) days
from the date it is finally determined that the Company is required to recognize
the transfer or assignment. The transferee or assignee shall sell
such interest to the Company if the option is exercised upon the terms and
conditions set forth herein. In the case of an impermissible transfer
at death, the transferee or assignee shall be deemed to be the decedent's
personal representative.
(ii)
Unless the Company and the transferee or assignee agree
otherwise, the purchase price for the Common Stock, or any fraction to be
acquired by the Company, shall be its Fair Market Value, determined as of the
last day of the month immediately preceding the month in which notice is
delivered.
(iii) Closing
of the sale shall occur at the principal office of the Company at 10 o'clock
a.m. on the first Tuesday of the month following the month in which the Fair
Market Value is determined.
(iv) In
order to reduce the burden upon the resources of the Company, the Company shall
have the option, to be exercised in writing delivered at closing, to pay its
purchase money obligation in sixty (60) equal monthly
installments with interest payable at the applicable federal rate for
mid-term obligations published by the United States Treasury
Department. The first installment shall be due and payable on the
first day of the month following closing, and subsequent monthly installments,
with accrued interest, shall be due and payable on the first day of each
succeeding month until the entire amount of the obligations is
paid. The Company shall have the right to prepay all or any part of
the purchase money obligation at any time without penalty.
(d) If
a party to this Agreement shall, or shall attempt to, sell, assign, transfer,
pledge, subject to any security interest, or otherwise dispose of its Common
Stock (except in a transaction permitted hereunder) without compliance with the
requirements of this Section 7, such party shall indemnify and hold harmless the
other parties to this Agreement against and from any and all liabilities,
obligations, costs and expenses the other parties hereto may incur as a result
of such failure.
(e) In
addition to the other limitations and restrictions set forth in this Section 7,
except as permitted by Section 7 (b), no Other Company Stockholder shall
Transfer all or any portion of its Common Stock (the “Offered Interest”) unless
such Other Company Stockholder (the “Selling Stockholder”) first offers to sell
the Offered Interest pursuant to the terms of this Section 7 (e).
-16-
(i) No
Transfer may be made under this Section 7 (e) unless the Selling Stockholder has
received a bona fide written offer (the “Purchase Offer”) from a Person (the
“Purchaser”) to purchase the Offered Interest for a purchase price (the “Offer
Price”) denominated and payable in United States dollars at closing or according
to specified terms, with or without interest, which offer shall be in writing
signed by the Purchaser and shall be irrevocable for a period ending no sooner
than the day following the end of the Offer Period, as hereinafter
defined.
(ii) Prior
to making any Transfer that is subject to the terms of this Section 7 (e), in
addition to giving the notice required by and otherwise complying with Section
4, the Selling Stockholder shall give to the Company and each Other Company
Stockholder written notice (the “Offer Notice”) which shall include a copy of
the Purchase Offer and an offer (the “Firm Offer”) to sell the Offered Interest
to the Other Company Stockholders and to the Company (the “Offerees”) for the
Offer Price, payable according to the same terms as (or more favorable terms
than) those contained in the Purchase Offer, provided that the Firm Offer shall
be made without regard to the requirement of any xxxxxxx money or similar
deposit required of the Purchaser prior to closing, and without regard to any
security (other than the Offered Interest) to be provided by the Purchaser for
any deferred portion of the Offer Price.
(iii) The
Firm Offer shall be irrevocable for a period of time (the “Offer Period”) ending
at 11:59 P.M., local time at the Company's principal place of business, on the
ninetieth day following the day of the Offer Notice.
(iv) At any time during the first sixty
(60) days of the Offer Period, any Offeree who is an Other Company Stockholder
may accept the Firm Offer as to all or any portion of the Offered Interest, by
giving written notice of such acceptance to the Selling Stockholder and Company
which notice shall indicate the maximum interests that such Offeree is willing
to purchase. In the event that within the first sixty (60) days of the Offer
Period, Offerees (“Accepting Offerees”), in the aggregate, accept the Firm Offer
with respect to all of the Offered Interest, the Firm Offer shall be deemed to
be accepted and the Selling Stockholder shall comply with Section 4. Except as
otherwise agreed by the remaining Stockholders, the right of the Accepting
Offerees to purchase the interests covered by the Purchase Offer shall be
allocated among the Accepting Offerees in proportion to their relative
Percentage Interests in the Company. At any time after the sixtieth (60) day of
the Offer Period, the Company may accept the Firm Offer as to any portion of the
Offered Interest that has not been previously accepted by giving written notice
of such acceptance to the Selling Stockholder. In the event that Accepting
Offerees, including the Company, in the aggregate, accept the Firm Offer with
respect to all of the Offered Interest, the Firm Offer shall be deemed to be
accepted. If Offerees do not accept the Firm Offer as to all of the Offered
Interest during the Offer Period, the Firm Offer shall be deemed to be rejected
in its entirety.
-17-
(v) In
the event that the Firm Offer is accepted, the closing of the sale of the
Offered Interest shall take place within thirty (30) days after the Firm Offer
is accepted or, if later, the date of closing set forth in the Purchase
Offer. The Selling Stockholder and all Accepting Offerees shall
execute such documents and instruments as may be necessary or appropriate to
effect the sale of the Offered Interest pursuant to the terms of the Firm Offer
and this Section 7. Any further transfer of the Offered Interest in
the hands of the Accepting Offerees shall be subject to the restrictions on
transfer contained in this Agreement, including without limitation Sections 4
and 5.
(vi) If
the Firm Offer is not accepted in the manner herein above provided, the Selling
Stockholder may, subject to compliance with Section 4, sell the Offered Interest
to the Purchaser at any time within sixty (60) days after the last day of the
Offer Period, provided that such sale shall be made on terms no more favorable
to the Purchaser than the terms contained in the Purchase Offer and provided
further that such sale complies with other terms, conditions, and restrictions
of this Agreement that are applicable to sales of interests and are not
expressly made inapplicable to sales occurring under this Section 7
(e). In the event that the Offered Interest is not sold in accordance
with the terms of the preceding sentence, the Offered Interest shall again
become subject to all of the conditions and restrictions of this Section 7
(e).
(f) An
Other Company Stockholder (and, in the case of subparagraphs (iii) and (iv), any
Person to which an Other Company Stockholder’s Common Stock has been transferred
under Section 7 (b) (iii)) shall be required to transfer the Stockholder’s
Common Stock to the Company, or at the option of the Company, to
the Other Company Stockholders proportionately, or to a new
stockholder, for the "Purchase Price" (hereafter defined) upon the occurrence of
any of the following:
(i) the
entry of any order or decree of court incident to any proceeding for divorce,
child support, division of marital property or similar proceeding requiring a
transfer of all or any part of the Other Company Stockholder’s Common
Stock;
(ii) attachment
or seizure in any legal proceedings of all or any part of the Other Company
Stockholder’s Common Stock or entry of any charging order against an Other
Company Stockholder’s Common Stock which is not being duly contested by the
Partner in good faith;
(iii) a
material breach of this Agreement by the Other Company Stockholder;
-18-
(iv) in
the case of an Employee Stockholder, the involuntary termination of employment
with the Company and/or the other Buying Entities. For purposes of
this provision, “involuntary termination” shall be termination of employment due
to (A) the employee’s failure, without leave or approval of the Company and/or
the other Buying Entities, to perform the employee’s duties reasonably assigned,
from time to time, to such employee by the Company and/or the other Buying
Entities, (B) employee’s fraud, misappropriation, embezzlement, willful
misconduct, gross negligence, or any other acts in dereliction of employee’s
duties and responsibilities to the Company and/or the other Buying Entities, (C)
employee’s conviction of any criminal offense involving dishonesty or moral
turpitude; (D) employee’s willful conduct that exposes the Company and/or the
other Buying Entities to criminal liability (or significant regulatory action)
under the laws of the Commonwealth of Pennsylvania or the United States; (E)
employee’s violation of any law, rule or regulation that jeopardizes the
business of employer; (F) employee’s misconduct or negligence that is injurious
to the Company and/or the other Buying Entities, or (G) any other cause which
would normally and reasonably constitute sufficient cause to terminate the
employment of an employee in employee’s job classification.
Upon the
occurrence of any of the foregoing events, such transferring Other Company
Stockholder's Common Stock shall be deemed transferred, and thereafter the Other
Company Stockholder or deceased Other Company Stockholder shall no longer be
entitled to any of the benefits of being a holder of Common Stock of the
Company, and shall be merely a creditor thereof to the extent of the Purchase
Price. The Purchase Price shall be the Fair Market Value of the
Common Stock, as determined on the last day of the month immediately preceding
the occurrence of the applicable event giving rise to the
transfer. The Purchase Price may be paid pursuant to the terms of
Section 7 (c) (v) and closing for the transfer of the Common Stock shall occur
on the first Tuesday of the month following the month in which the Fair Market
Value is determined.
(g) The
restrictions of this Section 7 shall not apply to any transfer pursuant to the
Put and Call Agreement or Section 5. The purchase rights of the Other
Company Stockholders under Section 7 (e) shall be limited to the non-selling
Other Company Stockholders; provided that if such Other Company Stockholders and
the Company fail to exercise such rights and Stockholder A has given written
notice of its intent to exercise the rights granted thereunder, Stockholder A
may exercise such rights.
(h) To
the extent that paragraph (f) of this Section 7 does not apply, after the later
of the date on which an Other Company Stockholder (or, in the case where the
Other Company Stockholder is an Eligible Retirement Plan, the participant/owner
of an account under an Eligible Retirement Plan) ceases to be either employed by
any Buyer Entity or serving in a material, advisory role to any Buyer Entity,
any Class A Common Stock held by the Other Company Stockholder shall be
immediately converted to Class B Common Stock; provided that, if by the
operation of this subparagraph of otherwise there are no shares of Class A
Common Stock issued and outstanding, then the shares of Class B Common Stock
shall be entitled to one vote per issued and outstanding share.
-19-
Section
8 Employee
Offering. Notwithstanding any other provision herein, the
parties hereto consent to the offering of 5,117 shares of Class B Common Stock
of the Company for cash equal to $107.25 per share; provided that such offering
is:
(a)
Made and
completed on or before December 31, 2008;
(b) Any
Person purchasing Common Stock pursuant to such offering (i) is employed by any
Buying Entity or serving as a material consultant to any Buying Entity (an
“Authorized Person”) or (ii) an Eligible Retirement Plan for the Account of a
participant/owner who is an Authorized Purchaser and agrees to bound by this
Agreement as an Other Company Stockholder and an Employee
Stockholder;
(c) The
offering does not preempt or adversely affect any rights of Stockholder A
hereunder;
(d) Upon
completion of such offering, Stockholder A shall continue to own at least 19.9%
of all outstanding Common Stock and other equity of the Company;
and
(e) In
full compliance with ERISA and the Securities Act.
Section
9 General.
(a) The
provisions of this Agreement shall be binding upon and inure to the benefit of
the Parties hereto and their respective heirs, successors and assigns; provided,
that the Company may not assign any of its rights or obligations hereunder
without the consent of the other Parties hereto and none of Stockholder A nor
any of the Other Company Stockholders may assign any of its rights and
obligations hereunder unless such assignment is in connection with a transfer of
its equity interest in the Company in a transaction not prohibited by this
Agreement and, prior to such assignment, the assignee agrees in writing to
become bound by the terms of this Agreement.
(b) Any
party to this Agreement which ceases to own equity securities in the Company
shall cease to be a party to, or be bound by, this Agreement; provided, that
such transfer is not prohibited by this Agreement and further provided, that
said party shall remain responsible for any obligation related to the period
during which said party owned equity securities in the Company.
(c) The
provisions of this Agreement shall apply to any and all shares of capital stock
of the Company, or any successor or assign of the Company (whether by merger,
consolidation, sale of assets or otherwise), which may issued in respect of, in
exchange for, or in substitution for the shares of Common Stock by reason of any
stock dividend, split, reverse split, combination, recapitalization,
reclassification, merger, consolidation or otherwise.
(d) Each
Party shall do and perform or cause to be performed all such further acts and
things and shall execute and deliver all such other agreements, certifications,
instruments and documents as any other Party hereto may reasonably request in
order to carry out the intent and accomplish the purposes of this Agreement and
the consummation of the transactions contemplated hereby.
-20-
(e) Except
as otherwise expressly provided herein, all notices which are required or
contemplated by this Agreement shall be in writing. Delivery of such
notices shall be deemed to be made when the same are either personally served
upon the person entitled thereto or sent by telecopy (fax) to such person (with
receipt acknowledged by the person receiving such telecopy) or three (3) days
after being deposited in the mails, by certified or registered mail, with
postage prepaid, addressed to such person at its mailing address as shown on the
records of the Company as changed by notice to parties hereto in accordance
herewith.
(f) Waiver
by any Party of any breach or default by any other Party of any of the terms of
this Agreement shall not operate as a waiver of any other breach or default
whether similar to or different from the breach or default waived. No
waiver shall be implied from any course of dealing or from any failure of any
Party to assert its rights hereunder on any occasion or series of
occasions.
(g) All
calculations and computations required or contemplated hereunder shall be
performed by the Company’s independent public accountants, whose determinations
absent manifest error shall be conclusive and binding on all
parties.
(h) This
Agreement constitutes the entire agreement and understanding of the parties
hereto with respect to the matters referred to herein. This Agreement
supersedes all previous agreements and understandings among the parties with
respect to such matters.
(i) This
Agreement shall be governed by and construed in accordance with the laws of the
Commonwealth of Pennsylvania, without regard to its principles of choice of laws
or conflict of laws. The Company and each of the Stockholders agree
that the venue for any dispute arising between the parties regarding this
Agreement shall be binding arbitration conducted by the American Arbitration
Association (AAA) in Philadelphia, Pennsylvania in accordance with the
Commercial Arbitration rules of the American Arbitration
Association. All disputes between the parties hereto shall be
determined solely and exclusively by arbitration in accordance with the
Commercial Rules then in effect of the American Arbitration Association, or any
successors hereto, in Philadelphia, Pennsylvania, unless the parties otherwise
agree in writing. The parties shall jointly select an
arbitrator. In the event the parties fail to agree upon an arbitrator
within ten (10) days, then each party shall select a party arbitrator within (7)
days and such arbitrators shall then select a third arbitrator to serve as the
sole arbitrator, provided that if either party through their party arbitrator
fails to select an arbitrator within seven (7) days, or the parties through
their party arbitrator fail to agree upon a sole arbitrator within seven (7)
days of appointment, such arbitrator shall be selected by the AAA upon
application of either party. Judgment upon the award of the agreed
upon arbitrator or the arbitrator selected by the AAA, as the case may be, shall
be binding and shall be entered into by a court of competent
jurisdiction. EACH PARTY TO THIS AGREEMENT HEREBY WAIVES THE RIGHT TO
SUBMIT ANY DISPUTE, CLAIM OR CAUSE OF ACTION THAT IT MAY HAVE AGAINST THE OTHER
PARTY UNDER THIS AGREEMENT TO A PUBLIC TRIBUNAL FOR JURY OR NON-JURY TRIAL,
PROVIDED THAT JUDGMENT ON THE AWARD RENDERED BY THE ARBITRATOR MAY BE ENTERED IN
ANY COURT HAVING JURISDICTION THEREOF.
-21-
(j) The
parties hereto may execute this Agreement and any document from time to time
executed in connection herewith in any number of counterparts, and by facsimile
or electronic transmission, each of which, when executed and delivered, shall be
an original; but all such counterparts shall constitute one and the same
instrument.
[The remainder of this page is
intentionally blank. Signatures on the next page]
-22-
| MXL OPERATIONS, INC. | ||
|
By:
|
/s/ Xxxxx X.
Xxxxxx
|
|
|
The
Company
|
||
| MXL INDUSTRIES, INC | ||
|
By:
|
/s/ Xxxx X.
Xxxxxxx
|
|
|
The
A Stockholder
|
||
| /s/ Xxxxxxx X. Xxxx | ||
| Xxxxxxx X. Xxxx | ||
| /s/ Xxxx X. Xxxxx | ||
| Xxxx X. Xxxxx | ||
| /s/ Xxxxx X. Xxxxxx | ||
| Xxxxx X. Xxxxxx | ||
| /s/ Xxxxxxxx X. Xxxxxxx | ||
| Xxxxxxxx X. Xxxxxxx | ||
| Xxxxxx Holdings, LLC | ||
|
By:
|
/s/ Xxxxxx
Xxxxxxx
|
|
| The Other Company Stockholders | ||
-23-
The
following schedule to the Stockholders Agreement is omitted from this filing
pursuant to Item 601(b)(2) of Regulation S-K:
Exhibit
A, listing the stockholders of MXL Operations, Inc. and their ownership
interests therein
The
registrant agrees to furnish supplementally a copy of the omitted schedule to
the Securities and Exchange Commission upon request.
-24-
