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EXHIBIT D
SHAREHOLDER AGREEMENT
This Agreement dated as of February 26, 1997 by and between Xxxxxxx
Foods, Inc., a Delaware corporation ("Xxxxxxx"); the Shareholders of Xxxxxxx
listed on Schedule I (individually "Shareholder" and collectively
"Shareholders"); the other former shareholders and partners of Papetti's
Hygrade Egg Products, Inc. ("Papetti's Hygrade") and the Acquired Entities
identified in the Reorganization Agreement described below and listed on
Schedule I (the "Sellers") and the Representative of the Shareholders and
Sellers;
WHEREAS, Xxxxxxx is a publicly-held corporation whose common stock is traded
on the NASDAQ National Market System ("NASDAQ-NMS"); and
WHEREAS, under date of June 29, 1996 Xxxxxxx, X.X. Xxxxxxxx
Company, a Nebraska corporation ("Acquisition"), Papetti's Hygrade and the
Acquired Entities defined therein entered into an Agreement and Plan of
Reorganization (the "Reorganization Agreement") whereby Xxxxxxx was to acquire
Papetti's Hygrade by merger (the "Papetti's Hygrade Reorganization") and
Acquisition was to acquire each of the Acquired Entities by mergers (the
"Mergers") or through asset purchases and liability assumption (the "Asset
Acquisitions"), as the case may be (the "Reorganization"); and
WHEREAS, as a condition to the completion of Papetti's Hygrade
Reorganization, the Mergers and the Asset Acquisitions, Xxxxxxx required that
the Shareholders and Sellers enter into this Agreement.
NOW, THEREFORE, in consideration of the foregoing and of the terms and
conditions hereinafter set forth, the parties agree as follows:
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SECTION 1. CERTAIN DEFINITIONS.
Capitalized terms not otherwise defined herein shall have the meaning
ascribed to them in the Reorganization Agreement. As used in this Agreement,
the following terms shall have the following meanings:
(a) "Affiliate" shall mean, as applied to a specified Person, any other
Person that directly or indirectly through one or more intermediaries,
Controls, or is Controlled by, or is under common Control with, such specified
Person.
(b) "Associate" when used to indicate a relationship with any Person, shall
mean: (i) any corporation or organization of which such Person is an officer or
partner or is, directly or indirectly, the beneficial owner of 10 percent or
more of any class of equity securities; (ii) any trust or other estate in which
such Person has a substantial beneficial interest or as to which such Person
serves as trustee or in a similar fiduciary capacity; and (iii) any relative or
spouse of such person, or any relative of such spouse, who has the same primary
residence as such Person or who is a director or officer of the Person or any
of its parents or subsidiaries.
(c) "Beneficially Own" or "Beneficial Ownership" with respect to any
securities shall mean having "Beneficial Ownership" of such securities in
accordance with the provisions of Rule 13d-3 under the Exchange Act, except
that a Person shall be deemed to be the Beneficial Owner of a security if that
Person has the right to acquire Beneficial Ownership of such security without
giving effect to the 60-day provision provided under such rule. Without
duplicative counting of the same securities by the same holder, securities
Beneficially Owned by a Person shall include securities Beneficially Owned by
all other Persons with whom such Person would constitute a Group.
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(d) "Business Day" shall mean any day that is not a Saturday, a Sunday, a
bank holiday or any other day on which commercial banking institutions in
Minneapolis, Minnesota, are not generally open for business.
(e) "Control" shall mean, with respect to a specified Person, the position
or the possession, directly or indirectly, of the power to direct, cause the
direction of, or substantially influence the management and policies of such
Person, whether through the ownership of voting securities, partnership
interests or other ownership interests, or by contract or otherwise; provided
that, in any event, any Person who owns directly or indirectly 10% or more of
the securities having ordinary voting power for the election of directors or
other governing body of a corporation or 10% or more of the partnership
interests or other ownership interests of any other Person shall be deemed to
control such corporation or other Person.
(f) "Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended, or any similar federal statute, and the rules and regulations of the
SEC thereunder, all as the same shall be in effect from time to time.
(g) "Equity Securities" shall mean: (i) any and all shares of capital stock
of Xxxxxxx; and (ii) any other securities, warrants, options or rights of any
nature (whether or not issued by Xxxxxxx) that are convertible into any,
exchangeable for, or exercisable for the purchase of, or otherwise give the
holder thereof any rights in respect of, shares of capital stock of Xxxxxxx.
(h) "Governmental Authority" shall mean any nation or government, any state
or other political subdivision thereof and any entity exercising executive,
legislative, judicial, regulatory or administrative functions of or pertaining
to government.
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(i) "Group" shall mean two or more Persons acting together for the purpose
of acquiring, holding, voting or disposing of Equity Securities, which Persons
would be required to file a statement on Schedule 13D or 13G with the SEC as a
"person" within the meaning of Section 13(d)(3) of the Exchange Act if such
Persons Beneficially Owned sufficient securities to require such a filing under
the Exchange Act.
(j) "Holder" shall mean any Shareholder that owns of record Registrable
Securities.
(k) "Person" shall mean an individual, partnership, corporation, business
trust, joint stock company, trust, unincorporated association, joint venture or
other entity of whatever nature.
(l) "Registrable Securities" means common stock of Xxxxxxx acquired by a
Shareholder in the Papetti's Hygrade Reorganization and any securities of
Xxxxxxx issued in respect thereof as a result of a stock dividend, stock split,
recapitalization, merger or other similar transaction with respect to such
common stock so acquired.
(m) "Requirement of Law" shall mean, as to any specified Person, any law,
treaty, rule or regulation of any Governmental Authority applicable to such
Person or any of its property or to which such Person or any of its property is
subject.
(n) "Schedule 13G Person" shall mean any Person or Group eligible to file a
statement on Schedule 13G with respect to Equity Securities pursuant to Rule
13d-1(b) under the Exchange Act.
(o) "SEC" shall mean the Securities and Exchange Commission or its
successor.
(p) "Securities Act" shall mean the Securities Act of 1933, as amended, or
any similar federal statute, and the rules and regulations of the SEC
thereunder, all as the same shall be in
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effect from time to time, and a reference to a particular section thereof shall
be deemed to include a reference to the comparable section, if any, of any
similar federal statute.
(q) The "Total Voting Power" at any measurement date shall mean the total
number of votes which could have been cast in an election of directors of
Xxxxxxx had a meeting of the shareholders of Xxxxxxx xxxx duly held based upon
a record date as of the measurement date if all Equity Securities then
outstanding and entitled to vote at such meeting were present and voted to the
fullest extent possible at such meeting.
SECTION 2. REPRESENTATIONS AND WARRANTIES OF XXXXXXX
Xxxxxxx represents and warrants to the Shareholders and Sellers that:
(a) Xxxxxxx has been duly incorporated and is validly existing and in good
standing as a corporation under the laws of the State of Delaware, with
corporate power to transact in all material respects its business as now
conducted by it, to enter into this Agreement, and to perform its obligations
hereunder.
(b) This Agreement has been duly authorized, executed and delivered by
Xxxxxxx and constitutes a legal, valid and binding agreement of Xxxxxxx,
enforceable against Xxxxxxx in accordance with its terms, except as such
enforceability may be limited by bankruptcy, insolvency, reorganization,
moratorium and other similar laws relating to or affecting creditors generally,
by general equity principles (regardless of whether such enforceability is
considered in a proceeding in equity or at law) or by an implied covenant of
good faith and fair dealing.
(c) Except as otherwise contemplated in this Agreement, no consent, approval
or authorization of, or filing, registration, qualification, declaration or
designation with, any Governmental Authority is required on the part of Xxxxxxx
as a condition to the valid execution,
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delivery and performance of this Agreement by Xxxxxxx, except where the absence
of any such consent, approval or authorization of, or the failure to make any
such filing, registration, qualification, declaration or designation with any
Governmental Authority would not have a material adverse effect on Xxxxxxx and
its subsidiaries taken as a whole or materially impair Michael's ability to
perform its obligations hereunder.
(d) The execution, delivery and performance by Xxxxxxx of this Agreement
will not: (i) conflict with the Articles of Incorporation or Bylaws of Xxxxxxx,
as amended; (ii) conflict with, result in a violation or breach of, or
constitute (with or without notice or lapse of time or both) a default (or give
rise to any third-party right of termination, cancellation, material
modification or acceleration) under, any of the terms, conditions or provisions
of any trust agreement, voting agreement, stockholders agreement, voting trust,
note, bond, mortgage, indenture, license, contract, commitment, arrangement,
understanding, agreement or other instrument or obligation of any kind
affecting Xxxxxxx or to which Xxxxxxx is a party or by which any of its
properties or assets are or may be bound; (iii) violate any Requirement of Law
applicable to Xxxxxxx; or (iv) violate any order, injunction, judgment or
decree of any court or other Governmental Authority or any determination of an
arbitrator applicable to Xxxxxxx or any of Michael's properties or assets,
except where such conflict, breach or other default under clause (ii) or any
such violation under clauses (iii) or (iv) would not have a material adverse
effect on Xxxxxxx and its subsidiaries taken as a whole or materially impair
Michael's ability to perform its obligations hereunder.
SECTION 3. REPRESENTATIONS AND WARRANTIES OF THE SHAREHOLDERS AND SELLERS
Each Shareholder and Seller jointly and severally represents and warrants to
Xxxxxxx that:
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(a) Each Shareholder and Seller has the legal capacity, power and authority
to enter into and perform all of such Shareholder's and Seller's obligations
under this Agreement. This Agreement has been duly executed and delivered by
each Shareholder and Seller and constitutes a legal, valid and binding
agreement of each Shareholder and Seller, enforceable against each Shareholder
and Seller in accordance with its terms, except as such enforceability may be
limited by bankruptcy, insolvency, reorganization, moratorium and other similar
laws relating to or affecting creditors generally, by general equity principles
(regardless of whether such enforceability is considered in a proceeding in
equity or at law) or by an implied covenant of good faith and fair dealing. If
any Shareholder is married and such Shareholder's Equity Securities constitute
community property, this Agreement has been duly authorized, executed and
delivered by, and constitutes a legal, valid and binding agreement of such
Shareholder's spouse, enforceable against such Person in accordance with its
terms, except as such enforceability may be limited by bankruptcy, insolvency,
reorganization, moratorium and other similar laws relating to or affecting
creditors generally, by general equity principles (regardless of whether such
enforceability is considered in a proceeding in equity or at law) or by an
implied covenant of good faith and fair dealing.
(b) No consent, approval or authorization of, or filing, registration,
qualification, declaration or designation with, any Governmental Authority is
required on the part of any Shareholder or Seller as a condition to the valid
execution, delivery and performance of this Agreement by any Shareholder.
(c) The execution, delivery and performance by each Shareholder and Seller
of this Agreement will not: (i) conflict with, result in a violation or breach
of, or constitute (with or
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without notice or lapse of time or both) a default (or give rise to any
third-party right of termination, cancellation, material modification or
acceleration) under, any of the terms, conditions or provisions of any trust
agreement, voting agreement, stockholders agreement, voting trust, note, bond,
mortgage, indenture, license, contract, commitment, arrangement, understanding,
agreement or other instrument or obligation of any kind affecting such
Shareholder or Seller or to which such Shareholder or Seller is a party or by
which any of such Shareholder's or Seller's properties or assets are or may be
bound; (ii) violate any Requirement of Law applicable to such Shareholder or
Seller; or (iii) violate any order, injunction, judgment or decree of any court
or other Governmental Authority or any determination of an arbitrator
applicable to such Shareholder or Seller or any of such Shareholder's or
Seller's properties or assets.
SECTION 4. COVENANTS OF THE SHAREHOLDERS AND SELLERS
(a) Acquisition of Equity Securities. For a period of three years from the
date of this Agreement or until the time that the Shareholders and Sellers as a
Group Beneficially Own Equity Securities representing in the aggregate less
than 5% of the Total Voting Power, whichever is earlier, no Shareholder or
Seller shall, directly or indirectly, acquire, offer to acquire, agree to
acquire, become the Beneficial Owner of, or obtain any rights in respect of,
any Equity Securities, by purchase or otherwise, or take any action in
furtherance thereof, if the effect of such acquisition, agreement or other
action would be (either immediately or upon consummation of any such
acquisition, agreement or other action, or expiration of any period of time
provided in any such acquisition, agreement or other action) to increase the
aggregate voting power in the election of directors of all Equity Securities
then Beneficially Owned by all
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Shareholders and Sellers (such aggregate voting power, (the "Aggregate Voting
Power") to 20% or more of the Total Voting Power (such maximum percentage
limitation, the "Maximum Percentage"). Notwithstanding anything to the
contrary in this Section 4(a), the Maximum Percentage may be exceeded if, and
solely to the extent that, the Aggregate Voting Power is or will be increased
solely as a result of a repurchase of any Voting Securities by Xxxxxxx or any
of its subsidiaries or any other change in Michael's capitalization or by
reason of the issuance of stock options by Xxxxxxx to any of the Shareholders
pursuant to any stock option plan maintained by Xxxxxxx.
(b) No Voting Trusts. For a period of three years from the date of this
Agreement or unitl the time that the Shareholders and Sellers as a Group
Beneficially Own Equity Securities representing in the aggregate less than 5%
of the Total Voting Power, whichever is earlier, no Shareholder or Seller shall
deposit any Equity Securities in a voting trust or subject any Equity
Securities to any arrangement or agreement with respect to the voting of such
Equity Securities except for a voting trust or other arrangement among the
Shareholders or Sellers or any of their Affiliates.
(c) No Proxy Solicitation Adverse to Board Recommendation. For a period of
three years from the date of this Agreement or until the time that the
Shareholders and Sellers as a Group Beneficially Own Equity Securities
representing in the aggregate less than 5% of the Total Voting Power, whichever
is earlier, no Shareholder or Seller shall solicit proxies or become a
"participant" in a "solicitation" (as such terms are defined in Regulation 14A
under the Exchange Act) in opposition to the recommendation of the Board of
Directors of Xxxxxxx with respect to any matter.
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(d) No Formation of Group. For a period of three years from the date of
this Agreement or until the time that the Shareholders and Sellers as a Group
Beneficially Own Equity Securities representing in the aggregate less than 5%
of the Total Voting Power, whichever is earlier, no Shareholder or Seller shall
join a partnership, limited partnership, syndicate or other Group, or otherwise
act in concert with any other Person, for the purpose of acquiring, holding,
voting or disposing of Equity Securities, or otherwise become a "Person" within
the meaning of Section 13(d)(3) of the Exchange Act (in each case other than
solely with other Shareholders or Sellers or their Affiliates or with such
Shareholders', Sellers' or Affiliates' representatives for estate planning
purposes).
(e) Vote For Restructuring. Each Shareholder will vote all of his Equity
Securities in favor of the Restructuring as described in the Reorganization
Agreement at any meeting of the stockholders of Xxxxxxx called for such purpose
or at any adjournment thereof.
SECTION 5. ADDITIONAL COVENANTS OF SHAREHOLDERS
(a) Two Year Restrictions on Disposition. For a period of two years from
the date of this Agreement, the Shareholders, individually or collectively,
shall not:
(i) sell or offer to sell Equity Securities in excess of 45,000
shares, as adjusted for any share dividend, stock split or other
recapitalization of Equity Securities, during any period of three
consecutive months;
(ii) pledge, hypothecate or encumber any Equity Securities Beneficially
Owned by such Shareholder, except to a financial institution pursuant to a
bona fide pledge, hypothecation or encumbrance to secure a bona fide loan for
money borrowed to one or more Shareholders, provided that, upon foreclosure
on such Equity Securities, such
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financial institution has executed and delivered to Xxxxxxx an agreement
whereby such financial institution agrees to be legally bound by the terms of
this Agreement as a "Shareholder" as if such financial institution were an
original signatory hereto; or
(iii) take or cause to be taken any action or actions which will
disqualify the Papetti's Hygrade Reorganization as contemplated in the
Reorganization Agreement, as a reorganization within the meaning of Section
368(a) of the Code.
(b) Three Year Restrictions on Disposition. For a period of three
years from the date of this Agreement or until the time that the
Shareholders and Sellers as a Group Beneficially Own Equity Securities
representing in the aggregate less than 5% of the Total Voting Power, whichever
is earlier, the Shareholders, individually or collectively, shall not:
(i) sell or offer to sell Equity Securities having five percent (5%) or
more of the Total Voting Power of Xxxxxxx to any Person or Group in any single
transaction or series of transactions without providing Xxxxxxx the first
right to buy such shares as provided in Section 5(c) below;
(ii) sell or offer to sell Equity Securities to any Person or Group
which the Shareholders have actual knowledge at time of the sale to
Beneficially Own five percent (5%) or more of the total Voting Power of
Xxxxxxx or, to any Person or Group who, by virtue of the sale or offer, would
Beneficially Own, five percent (5%) or more of the Total Voting Power of
Xxxxxxx, without in either case, providing to Xxxxxxx a first right to buy
such shares as provided in Section 5(c) below.
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(c) Michael's First Right to Purchase. Upon the occurrence of any event
described in Section 5(b)(i) or (ii), the Shareholder or Shareholders proposing
to sell or offer Equity Securities shall provide written notice thereof to
Xxxxxxx and shall offer to Xxxxxxx the right to purchase such Equity Securities.
The notice shall state the number of shares offered and the price per share and
any other conditions of the proposed sale or offer and shall include a copy of
any written document setting forth the terms of the proposed sale or offer
between the Shareholder or Shareholders and the purchaser or offeree. Xxxxxxx
shall have * from its receipt of such notice within which to purchase the Equity
Securities so offered. In the event that Xxxxxxx does not complete the purchase
within such * period, the Shareholder or Shareholders sending the notice shall
be permitted for a period of * thereafter to sell Equity Securities equal in
number to the shares offered in such notice free of any restrictions under this
Agreement at a price not less than the purchase price per share set forth in
such notice and under terms and conditions no more favorable to the purchaser
than the terms and conditions offered to Xxxxxxx in such notice.
(d) Tender Offers. The restrictions set forth in Section 5(b) and the first
right to buy set forth in Section 5(c) shall not apply if a tender offer is
made for all or substantially all of the outstanding shares of Xxxxxxx Common
Stock and the Board of Directors of Xxxxxxx does not, within seven days of the
commencement of such tender offer, announce its opposition to the tender offer.
Notwithstanding the foregoing, the following additional terms and conditions
shall apply in the event of the commencement of a tender offer:
(i) In the event that one or more of the Shareholders has given
notice to Xxxxxxx pursuant to Section 5(c) of this Agreement and, prior to
the exercise
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* The confidential portion has been so omitted and filed separately with
the Securities and Exchange Commission pursuant to a request for confidential
treatment under Rule 24(b)2 of the Securities Act of 1934.
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of Michael's right to buy, a tender offer is commenced for all or
substantially all of the outstanding shares of Xxxxxxx Common Xxxxx, Xxxxxxx
shall, within 20 days of the date that such Shareholder or Shareholders have
given such notice, have the right to acquire the Equity Securities subject to
the notice at the higher of the price offered by the Shareholder or
Shareholders in the notice or the tender offer price, regardless of whether
Michael's Board of Directors has announced its opposition to such tender
offer.
(ii) In the event that one or more of the Shareholders has given
notice to Xxxxxxx pursuant to Section 5(c) of this Agreement and, subsequent
to the exercise of Michael's right to buy, either a tender offer is commenced
for all or substantially all of the outstanding shares of Xxxxxxx Common Stock
or the Board of Directors rescinds its earlier opposition to such tender
xxxxx, Xxxxxxx shall have the option of (A) rescinding its agreement to
purchase the shares from the Shareholder or Shareholders within two days after
the commencement of such tender offer or the announcement by the Board of the
rescission of opposition to the tender offer, or (B) acquiring such shares at
the higher of the price offered by the Shareholder or Shareholders in the
notice or the tender office price.
SECTION 6. LEGEND.
All certificates representing shares of common stock of Xxxxxxx which are
subject to this Agreement shall bear the following legend:
"The shares represented by this certificate are subject to certain
restrictions on the transfer, sale or other disposition of the shares pursuant
to an agreement dated February 26, 1997 between the issuer and the
registered
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owner hereof, a copy of which may be obtained from the secretary of the
corporation."
Any shareholder receiving common stock of Xxxxxxx which is subject to this
Agreement shall promptly deliver the certificate for such shares to the
secretary of Xxxxxxx who shall place the foregoing legend on the certificate.
The Secretary of Xxxxxxx shall promptly return the legended certificates to the
Shareholders.
SECTION 7. - DIRECTORS.
For a period of three (3) years following the date of this Agreement, the
Board of Directors of Xxxxxxx shall include representatives of the Shareholders
as provided below. If the Shareholders collectively own * or more of the
outstanding common stock of Xxxxxxx, they shall be entitled to nominate two (2)
directors. If the Shareholders own less than * of the outstanding common
stock of Xxxxxxx, they shall be entitled to nominate one (1) director. Within
thirty (30) days following the end of each calendar year the Representative (as
defined in the Reorganization Agreement) shall give notice to Xxxxxxx of the
nominees of the Shareholders.
SECTION 8. REGISTRATION RIGHTS.
(a) Piggyback Rights. If at any time prior to the third anniversary date of
this Agreement, Xxxxxxx proposes to register Equity Securities under the
Securities Act, in connection with a public offering of Equity Securities for
its own account solely for cash (other than a registration on Form S-4 or S-8
or any successor form thereof) in a manner that would permit registration of
all or a portion of the Registrable Securities owned by the Shareholders,
Xxxxxxx will give prompt notice thereof to the Shareholders. Upon written
notice of any Shareholder to Xxxxxxx received within fifteen (15) days after
delivery of notice of the proposed
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* The confidential portion has been so omitted and filed separately with
the Securities and Exchange Commission pursuant to a request for confidential
treatment under Rule 24(b)-2 of the Securities Act of 1934.
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offering by Xxxxxxx, Xxxxxxx will use its best efforts to effect the
registration of the Registrable Securities covered by such notice under the
Securities Act; provided, however, that Xxxxxxx shall have the right to abandon
the registration in its entirety at any time and shall not be required to
register Registrable Securities if the underwriters in any underwritten
offering reasonably object to the inclusion of such shares in the registration,
and provided further, that in any underwritten offering, the Shareholders
participating in the registration agree to sell their Registrable Securities to
the underwriters on the same terms and conditions as apply to Xxxxxxx, with
such differences as customarily apply in combined primary and secondary
offerings of Equity Securities.
(b). Requested Registration. If, at any time prior to the third
anniversary date of this Agreement, Xxxxxxx shall receive a written request
from one or more Shareholders that Xxxxxxx effect the registration under the
Securities Act of all or a part of such Shareholders' Registrable Securities,
then Xxxxxxx will, within ten (10) days after receipt thereof, give notice to
all other Shareholders of the receipt of such request and each such holder may
elect by written notice received by Xxxxxxx within ten (10) days from the date
of the notice by Xxxxxxx to have all or part of his Registrable Securities
included in such registration. Upon receipt of such notice, Xxxxxxx will, as
soon as practicable, use reasonable efforts to effect the registration on Form
S-3 and pursuant to Rule 415 (the "Resale Registration Statement") under the
Securities Act of all Registrable Securities which it has been so requested to
register covering resales from time to time of such Registrable Securities and
Xxxxxxx shall use its reasonable best efforts to: (i) cause the Resale
Registration Statement to be declared effective by the SEC as soon as
practicable thereafter; and (ii) maintain the effectiveness of the Resale
Registration Statement
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continuously until the earliest of: (A) the date on which the Shareholders no
longer hold Registrable Securities registered under the Resale Registration
Statement or (B) the third anniversary of this Agreement or such lesser time as
may be permitted under Rule 144 under the Securities Act to enable the
Shareholders to sell the Registrable Securities under the Securities Act
without such registration. Xxxxxxx: (i) shall not be obligated to cause any
special audit to be undertaken in connection with any such registration; (ii)
shall be entitled to postpone for a reasonable period of time, but not in
excess of ninety (90) days, the filing of any registration statement otherwise
required to be prepared pursuant to this section if Xxxxxxx is, at such time,
conducting or about to conduct an underwritten public offering of equity
securities (or securities convertible into equity securities) and is advised in
writing by its managing underwriter that such underwritten public offer would,
in its opinion, be adversely effected by the registration so requested; and
(iii) shall be entitled to postpone such requested registration for up to 90
days if Xxxxxxx determines, in view of the advisability of deferring public
disclosure of material corporate developments or other information, that such
registration and the disclosure required to be made pursuant thereto would not
be in the best interest of Xxxxxxx at such time.
(c) Effective Registration. A registration pursuant to this
Section 9 will not be deemed to have been effected unless the Registration
Statement has been declared effective by the SEC; provided, however, that if
after such Registration Statement has been declared effective, the offering of
Registrable Securities pursuant to such Registration Statement is interfered
with by any stop order, injunction or other order or requirement of the SEC or
any other Governmental Authority or court, such Registration Statement will be
deemed not to have
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been effected during the period of such interference until the offering of
Registrable Securities pursuant to such Registration Statement may legally
resume.
(d) Registration Expenses. Xxxxxxx shall bear all expenses
incurred in connection with the registration of the Registrable Securities
pursuant to this Section 9. Such expenses shall include, without limitation,
all printing, legal and accounting expenses incurred by Xxxxxxx and all
registration and filing fees imposed by the SEC, any state securities
commission or the NASDAQ-NMS. Each Shareholder shall be responsible for any
brokerage fees or commissions and any taxes of any kind (including, without
limitation, transfer taxes) with respect to any disposition, sale or transfer
of Registrable Securities and for any legal, accounting and other expenses
incurred by such Shareholder.
(e) Selection of Underwriter and Investment Manager. If a
requested registration pursuant to this Section 9 involves an underwritten
offering, Xxxxxxx shall have the exclusive right to select an investment banker
or bankers and managers to administer the offering.
(f) Registration Procedures. If and whenever Xxxxxxx is required
to use its reasonable efforts to cause the registration of any Registrable
Securities under the Securities Act as provided in this Agreement, Xxxxxxx
will, as expeditiously as reasonably possible: (i) prepare and file with the
SEC such amendments and supplements to such Resale Registration Statement and
the prospectus used in connection therewith and shall timely file with the SEC
all required filings under the Exchange Act as may be necessary to comply with
the provisions of the Securities Act with respect to the disposition of all
Registrable Securities covered by such Resale Registration Statement and to
keep the Resale Registration Statement effective, but only while it shall be
required under the provisions of this Agreement to cause the Registration
Statement
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to remain current; (ii) furnish to each Shareholder seeking registration
hereunder such number of copies of the prospectus included in such Resale
Registration Statement (including each preliminary prospectus and summary
prospectus), and such other documents as each such Shareholder may reasonably
request in order to facilitate the disposition of the Registrable Securities by
such Shareholder but only while it shall be required under the provisions
hereof to cause the Registration Statement to remain current; (iii) use its
reasonable efforts to register or qualify such Registrable Securities covered
by such Resale Registration Statement under such other securities or blue sky
laws of such jurisdictions as the Shareholders shall reasonably request, except
that Xxxxxxx shall not, for any purpose, be required to qualify generally to do
business as a foreign corporation in any jurisdiction where, but for the
requirements of this clause, it would not be obligated to be so qualified, to
subject itself to taxation in any such jurisdiction, or consent to general
service of process in any such jurisdiction; (iv) use its reasonable efforts
to list the Registrable Securities on the NASDAQ-NMS, if such Registrable
Securities are not already so listed.
(g) Post-Registration Notices. Xxxxxxx shall promptly notify the
Shareholders: (i) when a prospectus or any prospectus supplement or
post-effective amendment (including any required filings under the Exchange
Act) has been filed and, with respect to the Resale Registration Statement or
any post-effective amendment, when the same has become effective; (ii) of any
request by the SEC or any state securities authority for amendments or
supplements to the Resale Registration Statement and prospectus or for
additional information after the Resale Registration Statement has become
effective; (iii) of the issuance by the SEC of any stop order suspending the
effectiveness of the Resale Registration Statement; (iv) of the issuance by any
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state securities commission or other regulatory authority of any order
suspending the qualification or exemption from qualification of any of the
Registrable Securities under such state's securities or "blue sky" laws; and
(v) of the happening of any event which makes any statement made in the Resale
Registration Statement or related prospectus untrue or which requires the
making of changes in such Resale Registration Statement or prospectus so that
they will not contain any untrue statement of a material fact or omit to state
any material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading. As soon as practicable, following the expiration of the
Suspension Period (as defined below), Xxxxxxx shall prepare and file with the
SEC and furnish a supplement or amendment to such prospectus so that, as
thereafter deliverable to the purchasers of such Registrable Securities, such
prospectus will not contain any untrue statement of a material fact or omit to
state a material fact necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading.
Upon receipt of any notice (a "Suspension Notice") by the Shareholders
from Xxxxxxx of the happening of any event of the kind described in this
Section 9(g), the Shareholders shall forthwith discontinue disposition of the
Registrable Securities pursuant to the Resale Registration Statement until the
Shareholders' receipt of the copies of the supplemental or amended prospectus
contemplated by this Section 9(g) or until the Shareholders have been advised
in writing (the "Advice") by Xxxxxxx that the use of the prospectus may be
resumed, and has received copies of any additional or supplemental filings
which are incorporated by reference in the prospectus, and, if so directed by
Xxxxxxx, will, or will request any broker or dealer acting as the Shareholders'
agent(s) to deliver to Xxxxxxx (at Michael's expense) all copies, other
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than permanent file copies then in the Shareholders' or their brokers' or
dealers' possession of the prospectus covering such Registrable Securities
current at the time of receipt of such notice; provided, however, that in no
event shall the period from the date on which the Shareholders receive a
Suspension Notice to the date which the Shareholders receive either the Advice
or copies of the supplemental or amended prospectus contemplated in this
Section 9(g) (the "Suspension Period") exceed 60 calendar days.
(h) Information. Xxxxxxx xxx require each selling Shareholder to
furnish it with such information regarding such selling Shareholder and
pertinent to the disclosure requirements relating to the registration and the
distribution of such securities as Xxxxxxx xxx from time to time reasonably
request in writing.
(i) Underwriting Agreement. The selling Shareholders shall
execute and deliver an underwriting agreement in customary form in connection
with any underwritten offering made pursuant to a registration hereunder.
SECTION 9 INDEMNIFICATION AND CONTRIBUTION
(a) Indemnification by Xxxxxxx. Xxxxxxx agrees to indemnify and
hold harmless to the full extent permitted by law, each Shareholder from and
against all losses, claims, damages, liabilities and expenses (including,
without limitation, reasonable legal fees and expenses incurred by shareholders
(collectively, the "Damages") to which the Shareholders may become subject
under the Securities Act or otherwise, insofar as such Damages (or proceedings
in respect thereof) arise out of or are based upon any untrue or alleged untrue
statement of a material fact contained in the Resale Registration Statement (or
any supplement or amendment thereto, including filings under the Exchange Act)
pursuant to which Registrable Securities were
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registered under the Securities Act, or caused by any omission or alleged
omission to state therein a material fact necessary to make the statements
therein in light of the circumstances under which they were made, not
misleading, or caused by any untrue statement or alleged untrue statement of a
material fact contained in any prospectus (as amended or supplemented if
Xxxxxxx shall have furnished any amendments or supplements thereto), or caused
by any omission or alleged omission to state therein a material fact necessary
to make the statements therein in light of the circumstances under which they
were made, not misleading, except insofar as such Damages arise out of or are
based upon any such untrue statement or omission based upon information
relating to the Shareholders furnished in writing to Xxxxxxx by the
Shareholders specifically for use therein; provided, however, that Xxxxxxx
shall not be liable to the Shareholders under this Section 10(a) to the extent
that any such Damages were caused by the fact that the Shareholders sold
Registrable Securities to a Person as to who it shall be established that there
was not sent or given, at or prior to written confirmation of such sale, a copy
of the prospectus as then amended or supplemented if, but only if: (i) Xxxxxxx
has previously furnished copies of such amended or supplemented prospectus to
the Shareholders; and (ii) such Damages were caused by any untrue statement or
omission or alleged untrue statement or omission contained in the prospectus so
delivered which was corrected in such amended or supplemented prospectus.
(b) Indemnification by Shareholders. The Shareholders agree to
indemnify, jointly and severally, and hold harmless Xxxxxxx, its stockholders,
directors, officers and each Person, if any, who controls Xxxxxxx within the
meaning of either Section 15 of the Securities Act or Section 20 of the
Exchange Act to the same extent as the foregoing indemnity from Xxxxxxx to
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the Shareholders in Section 10(a) of this Agreement but only with reference to
information relating to the Shareholders furnished in writing to Xxxxxxx by the
Shareholders specifically for use in the Resale Registration Statement (or any
amendment thereto) or any prospectus (or any amendment or supplement thereto);
provided, however, that the Shareholders shall not be obligated to provide such
indemnity to the extent that such Damages result from a failure of Xxxxxxx to
promptly amend or take action to correct or supplement any such Resale
Registration Statement or prospectus on the basis of corrected or supplemental
information provided in writing by the Shareholders to Xxxxxxx expressly for
such purpose. In no event shall the liability of the Shareholders hereunder be
greater in amount than the amount of the proceeds received by the Shareholders
upon the sale of the Registrable Securities giving rise to such indemnification
obligation.
(c) Contribution. To the extent that the indemnification provided
for in Section 10(a) or (b) is unavailable to an indemnified party or
insufficient in respect of any Damages, then each indemnifying party under such
Section, in lieu of indemnifying such indemnified party thereunder, shall
contribute to the amount paid or payable by such indemnified party as a result
of such Damages in such proportion as is appropriate to reflect the relative
fault of Xxxxxxx, on the one hand, and the Shareholders, on the other hand, in
connection with the statements or omissions that resulted in such Damages, as
well as any other relevant equitable considerations. The relative fault of
Xxxxxxx, on the one hand, and the Shareholders, on the other hand, shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to
state a material fact relates to information supplied by Xxxxxxx or by the
Shareholders and the parties' relative intent,
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knowledge, access to information and opportunity to correct or prevent such
statement or omission.
If indemnification is available under Section 10(a) or (b), the
indemnifying parties shall indemnify each indemnified party to the full extent
provided in such sections without regard to the relative fault of said
indemnifying party or the indemnified party or any other equitable
considerations provided for in this Section 10(c). Xxxxxxx and the
Shareholders agree that it would not be just or equitable if contribution
pursuant to this Section 10(c) were determined by pro rata allocation or by any
other method of allocation that does not take into account the equitable
considerations referred to in this section.
SECTION 10. GENERAL PROVISIONS
(a) Governing Law. This agreement shall be governed by and
interpreted and enforced in accordance with the laws of the State of Delaware
without giving effect to any conflicts of law provisions.
(b) Remedies. Xxxxxxx, on the one hand, and the Shareholders and
Sellers, on the other, acknowledge and agree that the other would not have an
adequate remedy at law for money damages in the event that any of the covenants
or agreements in this Agreement of such party were not performed in accordance
with its terms, and it is therefore agreed that in addition to and without
limiting any other remedy or right such party may have, any party will have the
right to an injunction or other equitable relief (including specific
performance) in any court of competent jurisdiction, enjoining any such breach
and enforcing specifically the terms and provisions hereof. All rights, powers
and remedies provided under this Agreement or otherwise available in respect
hereof at law or in equity shall be cumulative and not alternative.
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(c) Notices. All notices, demands and other communications which
may or are required to be given hereunder or with respect hereto shall be given
by the Representative on behalf of the Shareholders and Sellers and by Xxxxxxx
on behalf of itself. All such notices, demands and other communications shall
be in writing, shall be given either by personal delivery or by nationally
recognized overnight courier or by telecopier, and shall be deemed to have been
given or made when personally delivered, one business day after delivered to a
nationally recognized overnight courier, postage prepaid, and receipt
requested, or one business day after transmission by facsimile, receipt
confirmed, addressed as follows:
(i) IF TO XXXXXXX:
Xxxxxxx X. Xxxxxxx
Executive Vice President
Xxxxxxx Foods, Inc.
0000 Xxxxxxx Xxxxxxxxx
000 Xxxx Xxxxxxxx Xxxx Xxxxxxxx
Xxxxxxxxxxx, Xxxxxxxxx 00000
Telephone: 000-000-0000
Facsimile No.: 000-000-0000
with a copy to:
Xxxxxx X. Xxxxxxxx
Maun & Simon, PLC
0000 Xxxxxxx Xxxxx Xxxxxxxx Xxxx
000 Xxxxxxxx Xxxx
Xxxxxxxxxxx, Xxxxxxxxx 00000
Telephone: 000-000-0000
Facsimile No.: 000-000-0000
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(ii) IF TO THE SHAREHOLDERS OR SELLERS:
Xxxxxx X. Xxxxxxx
c/o Papetti's Hygrade Egg Products, Inc.
000 Xxxxxxxx Xxxxxx
Xxxxxxxxx, Xxx Xxxxxx 00000
Telephone: 000-000-0000
Facsimile No.: 000-000-0000
As Representative
with a copy to:
Xxxxxx X. X'Xxxxxx, XX Xxxxxx X. XxXxxx
X'Xxxxxx, Xxxxx & X'Xxxxxx Xxxxxxxx Xxxxxx
Liberty Hall Center One Mercantile Center
0000 Xxxxxx Xxxxxx Xxxxx 0000
Xxxxx, Xxx Xxxxxx 00000 Xx. Xxxxx, Xxxxxxxx 00000
Telephone: 000-000-0000 Telephone: 000-000-0000
Facsimile No.: 000-000-0000 Facsimile No.: 000-000-0000
or to such other address as any such person or entity may from time to time
designate by notice to the others.
(d) Severability. If any term, provision, covenant or restriction
of this Agreement is held by a court of competent jurisdiction to be invalid,
void, or unenforceable, the remainder of the terms, provisions, covenants and
restrictions shall remain in full force and effect and shall in no way be
affected, impaired or invalidated. The parties agree that they will use their
best efforts at all times to support and defend this Agreement.
(e) Amendments. This Agreement may be amended only by an
agreement in writing signed by all of the parties hereto.
(f) Descriptive Headings. Descriptive headings are for
convenience only and shall not control or affect the meaning or construction of
any provision of this Agreement.
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(g) Counterparts. This Agreement shall become binding when one or
more counterparts hereof, individually or taken together, bears the signatures
of each of the parties hereto. This Agreement may be executed in any number of
counterparts, each of which shall be an original as against the party whose
signature appears thereon, or on whose behalf such counterpart is executed, but
all of which when taken together shall be one and the same statement.
(h) Successors and Assigns. This Agreement shall be binding upon
and inure to the benefit of and be enforceable by the successors and assigns of
the parties hereto, provided that a Shareholder may not assign any of his
rights or obligations hereunder to any person without the prior written consent
of Xxxxxxx. Notwithstanding the foregoing, the consent of Xxxxxxx shall not be
required in connection with the assignment of this Agreement to the estate of a
Shareholder.
IN WITNESS WHEREOF, the parties hereto intending to be legally bound
have duly executed this Agreement, all as of the day and year first above
written.
XXXXXXX FOODS, INC.
By: /s/ Xxxxx Xxxxxxxxx
-------------------------
Its: President
-----------------------
/s/ Xxxxxx X. Xxxxxxx
----------------------------------
Xxxxxx X. Xxxxxxx
As Representative of and
attorney-in-fact for the Shareholders
and Sellers listed on Schedule I
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SCHEDULE I
LIST OF SHAREHOLDERS AND SELLERS
A. SHAREHOLDERS
Xxxxxxx Xxxxxxx
Xxxxxx Xxxxxxx
Xxxxxx X. Xxxxxxx
X. XXXXXXX
Xxxxxx X. Xxxxxxx
Xxxxxxx Xxxxxxx
The Xxxxxx Xxxxxxx S Corporation Stock Trust
The Xxxxxxx Xxxxxxx S Corporation Stock Trust
The Xxxx Xxxxx Xxxx S Corporation Stock Trust
The Xxxxxx X. Xxxxxxx S Corporation Stock Trust
The Xxxx Xxxxxxx Xxxxxxx S Corporation Stock Trust
Declaration of Irrevocable Living Trust by Xxxxxxx Xxxxxxx FBO Xxxxxxx
Xxxxxxx U/D 2/1/95
Declaration of Irrevocable Living Trust by Xxxxxxx Xxxxxxx FBO Xxxxxx
Xxxxxxx U/D 2/1/95
Declaration of Irrevocable Living Trust by Xxxxxx X. Xxxxxxx FBO
Xxxxxx X. Xxxxxxx U/D 12/1/93
Declaration of Irrevocable Living Trust by Xxxxxx X. Xxxxxxx FBO Xxxx
Xxxxx Xxxxxxx-Xxxx U/D 12/1/93
Declaration of Irrevocable Living Trust by Xxxxxx X. Xxxxxxx FBO Xxxx
Xxxxxxx Xxxxxxx U/D 12/1/93
Xxxxxx X. Xxxxxxx Family Limited Partnership
Xxxxxxx Xxxxxxx Family Limited Partnership
Xxxx Xxxxx Xxxx Family Limited Partnership
Xxxxxx Xxxxxxx Family Trust
Xxxxxxx Xxxxxxx Family Trust
Xxxxxx X. Xxxxxxx Family Trust
Xxxx Xxxxx Xxxx Family Trust
1995 Irrevocable Living GSTE Trust by Xxxxxxx Xxxxxxx FBO Xxxxxx X.
Xxxxxxx U/D 8/10/95
1995 Irrevocable Living GSTE Trust by Xxxxxxx Xxxxxxx FBO Xxxxxx
Xxxxxxx U/D 8/10/95
1995 Irrevocable Living GSTE Trust by Xxxxxxx Xxxxxxx FBO Xxxxxxx
Xxxxxxx U/D 8/10/95
1995 Irrevocable Living Trust by Xxxx Xxxxx Xxxx FBO Xxxx Xxxxx Xxxx
U/D 8/10/95 Xxxx Xxxxxxx Xxxxxxx
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