1
EXHIBIT 4
Number
Shareholders Party to Stock Agreement with Purchase Option of Shares
---------------------------------------------------------- ---------
Xxxxxxx Xxxxx Capital Corporation 5,950,177
Xxxxx X. Xxxxx 1,656,187
Xxxxx X. Xxxxx 127,005
Xxxxx Xxxxxx Xxxx, Xx. Ttee Xxxxxxxx Xxxxx Xxxxxx
Xxxxx X. Xxxxx Irrevocable Trust
dtd 12/28/88 FBO Xxxxxxxx Xxxxx Xxxxxx 80,251
Xxxxx Xxxxxx Xxxx, Xx. Ttee Xxxxxx Xxxxx Xxxxx
Xxxxx X. Xxxxx Irrevocable Trust
dtd 12/28/88 FBO Xxxxxx Xxxxx Xxxxx 80,251
Xxxxx Xxxxxx Xxxx, Xx. Ttee Xxxxx X. Xxxxx XX
Xxxxx X. Xxxxx Irrevocable Trust
dtd 12/28/88 FBO Xxxxx X. Xxxxx XX 80,251
The Xxxxx Family Foundation 114,400
The Southeastern Baptist Theological Seminary 300,000
X. Xxxx Xxxxx 1,038,865
Xxxxxxx Xxxxxx Xxxx Xxxxxxxx Xxxxx Xxxxx
X. Xxxx Xxxxx Irrevocable Trust
dtd 12/28/88 FBO Xxxxxxxx Xxxxx Xxxxx 83,351
Xxxxxxx Xxxxxx Ttee Xxxxxx Xxxx Xxxxx
X. Xxxx Xxxxx Irrevocable Trust
dtd 12/28/88 FBO Xxxxxx Xxxx Xxxxx 83,351
X. Xxxxxx Xxxx Xx. 294,685
The Xxxx Family Foundation 49,100
Shareholders Party to Stock Agreement without Purchase Option
-------------------------------------------------------------
Xxxx X. Xxxx 347,600
Xxxxxx X. Xxxxxxx 564,160
Xxxxxxx Children 230,997
Xxx X. XxXxxx, Xx. 1,455,000
2
EXHIBIT 4
FORM OF STOCK AGREEMENT WITH PURCHASE OPTION
STOCK AGREEMENT, dated as of December __, 1996, among PCA International,
Inc., a North Carolina corporation ("Parent"), ASI Acquisition Corp., a North
Carolina corporation and a direct wholly owned subsidiary of Parent (the
"Purchaser"), and ___________________ (the "Shareholder").
W I T N E S S E T H:
WHEREAS, concurrently with the execution and delivery of this Agreement,
Parent, the Purchaser and American Studios, Inc., a North Carolina corporation
(the "Company"), have entered into an Agreement and Plan of Merger (as such
agreement may hereafter be amended from time to time, the "Merger Agreement"),
pursuant to which the Purchaser will be merged with and into the Company (the
"Merger") (capitalized terms used and not defined herein have the respective
meanings ascribed to them in the Merger Agreement);
WHEREAS, in furtherance of the Merger, as soon as practicable (and not
later than five business days) after the execution and delivery of the Merger
Agreement, Purchaser shall commence a cash tender offer (the "Offer") to
purchase at a price of $2.50 per share all outstanding shares of Company Common
Stock (as defined in Section 1 hereof) including all of the Shares (as defined
in Section 2 hereof) beneficially owned by the Shareholder; and
WHEREAS, as an inducement and a condition to entering into the Merger
Agreement, Parent has required that the Shareholder agree, and the Shareholder
has agreed, to enter into this Agreement;
NOW, THEREFORE, in consideration of the foregoing and the mutual premises,
representations, warranties, covenants and agreements contained herein, the
parties hereto, intending to be legally bound hereby, agree as follows:
1. Definitions. For purposes of this Agreement:
(a) "Beneficially Own" or "Beneficial Ownership" with respect to any
securities shall mean having "beneficial ownership" of such securities (as
determined pursuant to Rule 13d-3 under the Securities Exchange Act of 1934, as
amended (the "Exchange Act")), including pursuant to any agreement, arrangement
or understanding, whether or not in writing. 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" as within the meaning of Section
13(d)(3) of the Exchange Act.
(b) "Company Common Stock" shall mean at any time the common stock, $.00l
par value, of the Company.
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(c) "Person" shall mean an individual, corporation, partnership, joint
venture, association, trust, unincorporated organization or other entity.
2. Tender of Shares.
(a) In order to induce Parent and the Purchaser to enter into the Merger
Agreement, the Shareholder hereby agrees to validly tender (or cause the record
owner of such shares to validly tender), and not to withdraw, pursuant to and
in accordance with the terms of the Offer, not later than the fifth business
day after commencement of the Offer pursuant to Section 1.1 of the Merger
Agreement and Rule 14d-2 under the Exchange Act, the number of shares of
Company Common Stock set forth opposite such Shareholder's name on Schedule I
hereto (the "Existing Shares", and together with any shares acquired by the
Shareholder in any capacity after the date hereof and prior to the termination
of this Agreement whether upon the exercise of options, warrants or rights, the
conversion or exchange of convertible or exchangeable securities, or by means
of purchase, dividend, distribution or otherwise, the "Shares"), all of which
are Beneficially Owned by the Shareholder. The Shareholder hereby acknowledges
and agrees that Xxxxxx's and the Purchaser's obligation to accept for payment
and pay for Shares in the Offer, including the Shares Beneficially Owned by
such Shareholder, is subject to the terms and conditions of the Offer.
(b) The transfer by the Shareholder of the Shares to the Purchaser in the
Offer shall pass to and unconditionally vest in the Purchaser good and valid
title to the Shares, free and clear of all claims, liens, restrictions,
security interests, pledges, limitations and encumbrances whatsoever.
(c) The Shareholder hereby permits Parent and the Purchaser to publish and
disclose in the Offer Documents and, if approval of the Company's shareholders
is required under applicable law, the Proxy Statement (including all documents
and schedules filed with the SEC) its identity and ownership of the Company
Common Stock and the nature of its commitments, arrangements and understandings
under this Agreement.
3. Option. In order to induce Parent and the Purchaser to enter into the
Merger Agreement, the Shareholder hereby grants to Parent an irrevocable option
(a "Stock Option") to purchase the Shares from the Shareholder (the "Option
Shares") at an amount (the "Purchase Price") equal to the Offer Price. If (i)
the Offer is terminated, abandoned or withdrawn by Parent or the Purchaser, or
(ii) the Merger Agreement is terminated in accordance with its terms, the Stock
Option shall, in any such case (but provided neither Parent nor the Purchaser
has materially breached the Merger Agreement), become exercisable, in whole or
in part, upon the first to occur of any such event and remain exercisable in
whole or in part until the date which is 45 days after the date of the
occurrence of such event (the "45 Day Period"), so long as: (i) all waiting
periods under the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of 1976, as
amended (the "HSR Act"), required for the purchase of the Option Shares upon
such exercise shall have expired or been waived, and (ii) there shall not be in
effect any preliminary or final injunction or other order issued by any court
or governmental, administrative or regulatory agency or authority or
legislative body or commission prohibiting the exercise of the Stock Option
pursuant to this
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Agreement; provided that if all HSR Act waiting periods shall not have expired
or been waived or there shall be in effect any such injunction or order, in
each case on the expiration of the 45 Day Period, the 45 Day Period shall be
extended until 5 business days after the later of (A) the date of expiration or
waiver of all HSR Act waiting periods and (B) the date of removal or lifting of
such injunction or order; provided further that in no event shall the 45 Day
Period be extended beyond June 30, 1997. In the event that Parent wishes to
exercise the Stock Option, Parent shall send a written notice (the "Notice") to
the Shareholder identifying the place and date (not less than two nor more than
10 business days from the date of the Notice) for the closing of such purchase.
In the event that Parent has terminated the Offer due to the occurrence of any
event set forth in clauses (a)-(c) of Annex A to the Merger Agreement and
Parent exercises the Stock Option and purchases the Option Shares, Parent
shall, to the extent permitted by law, seek to purchase all of the remaining
shares of Company Common Stock outstanding at the Purchase Price pursuant to a
merger and/or tender offer.
4. Provisions Concerning the Company Common Stock. During the period
commencing on the date hereof and continuing until the first to occur of the
Effective Time or termination of the Merger Agreement in accordance with its
terms, the Shareholder shall, at any meeting of the holders of Company Common
Stock, however called, or in connection with any written consent of the holders
of Company Common Stock, vote (or cause to be voted) the Shares (if any) then
held of record or Beneficially Owned by the Shareholder, (i) in favor of the
Merger, the execution and delivery by the Company of the Merger Agreement and
the approval of the terms thereof and each of the other actions contemplated by
the Merger Agreement and this Agreement and any actions required in furtherance
thereof and hereof; (ii) against any action or agreement that would result in a
breach in any respect of any covenant, representation or warranty or any other
obligation or agreement of the Company under the Merger Agreement; and (iii)
except as otherwise agreed to in writing in advance by Parent, against the
following actions (other than the Merger and the transactions contemplated by
the Merger Agreement): (A) any extraordinary corporate transaction, such as a
merger, consolidation or other business combination involving the Company or
its Subsidiaries; (B) a sale, lease or transfer of a material amount of assets
of the Company or its Subsidiaries, or a reorganization, recapitalization,
dissolution or liquidation of the Company or its Subsidiaries; (C)(1) any
change in a majority of the persons who constitute the board of directors of
the Company; (2) any change in the present capitalization of the Company or any
amendment of the Company's Articles of Incorporation or Bylaws; (3) any other
material change in the Company's corporate structure or business; or (4) any
other action which, in the case of each of the matters referred to in clauses
(iii)(C)(1), (2) or (3) of this Section 4, is intended, or could reasonably be
expected, to impede, interfere with, delay, postpone, or materially adversely
affect the Merger and the actions and transactions contemplated by this
Agreement and the Merger Agreement. The Shareholder shall not enter into any
agreement or understanding with any person or entity the effect of which would
be inconsistent or violative of the provisions and agreements contained in this
Section 4.
5. Covenants, Representations and Warranties of the Shareholder. The
Shareholder hereby represents and warrants to Parent as follows:
5
(a) Ownership of Shares. The Shareholder is the Beneficial Owner of the
Shares, as set forth on Schedule 1. On the date hereof, the Existing Shares
constitute all of the outstanding Shares owned of record or Beneficially Owned
by the Shareholder. The Shareholder has sole voting power and sole power to
issue instructions with respect to the matters set forth in Sections 2 and 4
hereof, sole power of disposition, sole power to demand appraisal rights and
sole power to agree to all of the matters set forth in this Agreement, in each
case with respect to all of the Existing Shares with no limitations,
qualifications or restrictions on such rights, subject to applicable securities
laws and the terms of this Agreement.
(b) Power; Binding Agreement. The Shareholder has the legal capacity,
power and authority to enter into and perform all of his obligations under this
Agreement. The execution, delivery and performance of this Agreement by the
Shareholder will not violate any other agreement to which the Shareholder is a
party including, without limitation, any voting agreement, proxy arrangement,
pledge agreement, shareholders agreement or voting trust. This Agreement has
been duly and validly executed and delivered by the Shareholder and constitutes
a valid and binding agreement of the Shareholder, enforceable against the
Shareholder in accordance with its terms. There is no beneficiary or holder of
a voting trust certificate or other interest of any trust of which the
Shareholder is a trustee whose consent is required for the execution and
delivery of this Agreement or the consummation by such Shareholder of the
transactions contemplated hereby.
(c) No Conflicts. Except for (i) filings under the HSR Act and the
Exchange Act, (A) no filing with, and no permit, authorization, consent or
approval of, any state or federal public body or authority is necessary for the
execution of this Agreement by the Shareholder and the consummation by the
Shareholder of the transactions contemplated hereby and (B) none of the
execution and delivery of this Agreement by the Shareholder, the consummation
by the Shareholder of the transactions contemplated hereby or compliance by the
Shareholder with any of the provisions hereof shall (1) conflict with or result
in any breach of any applicable organizational documents applicable to the
Shareholder, (2) 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 note,
loan agreement, bond, mortgage, indenture, license, contract, commitment,
arrangement, understanding, agreement or other instrument or obligation of any
kind to which the Shareholder is a party or by which the Shareholder or any of
its properties or assets may be bound, or (3) violate any order, writ,
injunction, decree, judgment, order, statute, rule or regulation applicable to
the Shareholder or any of its properties or assets.
(d) No Encumbrances. Except as permitted by this Agreement, the Shares
and the certificates representing such Shares are now, and at all times during
the term hereof will be, held by the Shareholder, or by a nominee or custodian
for the benefit of such Shareholder, free and clear of all liens, claims,
security interests, proxies, voting trusts or agreements, understandings or
arrangements or any other encumbrances whatsoever, except for any such
encumbrances or proxies arising hereunder.
6
(e) No Finder's Fees. No broker, investment banker, financial advisor or
other person is entitled to any broker's, finder's, financial adviser's or
other similar fee or commission in connection with the transactions
contemplated hereby based upon arrangements made by or on behalf of the
Shareholder.
(f) No Solicitation. The Shareholder shall not, in the capacity as a
shareholder or otherwise, directly or indirectly, solicit (including by way of
furnishing information) or negotiate in response to any inquiries or the making
of any proposal by any person or entity (other than Parent or any affiliate of
Parent) concerning any merger, tender offer, exchange offer, sale of assets,
sale of shares of capital stock or debt securities or similar transactions
involving the Company or any Subsidiary, division or operating or principal
business unit of the Company. If the Shareholder receives any such inquiry or
proposal, then the Shareholder shall promptly inform Parent of the existence
thereof. The Shareholder will immediately cease and cause to be terminated any
existing activities, discussions or negotiations with any parties conducted
heretofore with respect to any of the foregoing. Notwithstanding the
foregoing, nothing herein shall prevent the Shareholder from complying with any
fiduciary duties it may have in its capacity as an officer and/or director of
the Company.
(g) Restriction on Transfer, Proxies and Non-Interference. The
Shareholder shall not, directly or indirectly: (i) except as applicable in
connection with the transactions contemplated by Section 2 hereof, offer for
sale, sell, transfer, tender, pledge, encumber, assign or otherwise dispose of,
or enter into any contract, option or other arrangement or understanding with
respect to or consent to the offer for sale, sale, transfer, tender, pledge,
encumbrance, assignment or other disposition of, any or all of the Shares or
any interest therein (any such transaction, a "Transfer"), except that
Shareholder may transfer Shares to a family member of such Shareholder or a
charitable organization provided such transferee agrees to be bound by the
provisions of this Agreement; (ii) except as contemplated by this Agreement,
grant any proxies or powers of attorney, deposit the Shares into a voting trust
or enter into a voting agreement with respect to the Shares; or (iii) take any
action that would make any representation or warranty of the Shareholder
contained herein untrue or incorrect or have the effect of preventing or
disabling the Shareholder from performing its obligations under this Agreement.
(h) Reliance by Xxxxxx. The Shareholder understands and acknowledges that
Parent is entering into, and causing Purchaser to enter into, the Merger
Agreement in reliance upon the Shareholder's execution and delivery of this
Agreement.
(i) Waiver of Appraisal Rights. The Stock holder hereby waives any rights
of appraisal or rights to dissent from the Merger that such Shareholder may
have.
(j) Access to Information. The Shareholder represents and warrants that,
in connection with the execution and delivery of this Agreement, the
Shareholder has been afforded the full opportunity to ask questions and receive
information regarding the Offer and the terms of the Merger Agreement and the
transactions contemplated thereby and the interests of any affected party.
7
6. Covenants, Representations and Warranties of Parent and the Purchaser.
Each of Parent and the Purchaser hereby represents and warrants to the
Shareholder as follows:
(a) Power; Binding Agreement. Parent and the Purchaser each has the
corporate power and authority to enter into and perform all of its obligations
under this Agreement. The execution, delivery and performance of this
Agreement by the each of the Parent and the Purchaser will not violate any
other agreement to which either of them is a party. This Agreement has been
duly and validly executed and delivered by each of the Parent and the Purchaser
and constitutes a valid and binding agreement of each of the Parent and the
Purchaser, enforceable against each of the Parent and the Purchaser in
accordance with its terms.
(b) No Conflicts. Except for (i) filings under the HSR Act and the
Exchange Act, (A) no filing with, and no permit, authorization, consent or
approval of, any state or federal public body or authority is necessary for the
execution of this Agreement by each of the Parent and the Purchaser and the
consummation by each of the Parent and the Purchaser of the transactions
contemplated hereby and (B) none of the execution and delivery of this
Agreement by each of the Parent and the Purchaser, the consummation by each of
the Parent and the Purchaser of the transactions contemplated hereby or
compliance by each of the Parent and the Purchaser with any of the provisions
hereof shall (1) conflict with or result in any breach of any applicable
organizational documents applicable to either of the Parent or the Purchaser,
(2) 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 note, loan agreement, bond,
mortgage, indenture, license, contract, commitment, arrangement, understanding,
agreement or other instrument or obligation of any kind to which either of the
Parent or the Purchaser is a party or by which either of the Parent or the
Purchaser or any of their properties or assets may be bound, or (3) violate any
order, writ, injunction, decree, judgment, order, statute, rule or regulation
applicable to either of the Parent or the Purchaser or any of their properties
or assets.
(c) No Finder's Fees. No broker, investment banker, financial advisor or
other person is entitled to any broker's, finder's, financial adviser's or
other similar fee or commission in connection with the transactions
contemplated hereby based upon arrangements made by or on behalf of either of
the Parent or the Purchaser.
7. Further Assurances. From time to time, at the other party's request
and without further consideration, each party hereto shall execute and deliver
such additional documents and take all such further lawful action as may be
necessary or desirable to consummate and make effective, in the most
expeditious manner practicable, the transactions contemplated by this
Agreement.
8. Stop Transfer. The Shareholder shall not request that the Company
register the transfer (book-entry or otherwise) of any certificate or
uncertificated interest representing any of the Shares, unless such transfer is
made in compliance with this Agreement. In the event of a stock dividend or
distribution, or any change in the Company Common Stock by reason of any stock
dividend, split-up, recapitalization, combination, exchange of shares or
8
the like, the term "Shares" shall refer to and include the Shares as well as
all such stock dividends and distributions and any shares into which or for
which any or all of the Shares may be changed or exchanged.
9. Termination. Except for Section 10 hereof, and except as otherwise
provided herein, including, but not limited to, Section 3 hereof, the covenants
and agreements contained herein shall terminate upon the termination of the
Merger Agreement in accordance with its terms.
10. Indemnification. Parent shall indemnify, defend and hold harmless the
Shareholder from and against any and all losses, damages, liabilities and
expenses (including, without limitation but subject to the next sentence,
reasonable fees and expenses of outside counsel) resulting from any claim or
litigation arising out of the execution, delivery and performance by the
Shareholder of this Stock Agreement. The Shareholder shall give prompt written
notice to Parent upon the Shareholder becoming aware of any claim or action in
respect of which the Shareholder intends to seek indemnity hereunder, and
Parent shall by prompt written notice to the Shareholder be entitled to assume
the defense of such claim or action with counsel selected by the Parent and
reasonably acceptable to the Shareholder.
Notwithstanding the foregoing, if the undersigned is an officer and/or
director of the Company and the claim or litigation relates to the
undersigned's status or conduct as an officer and/or director as well as the
undersigned's execution, delivery and performance of this Stock Agreement as a
Shareholder, the undersigned shall first seek recourse under any other
indemnity or insurance coverage to which the undersigned may be entitled in
such other capacities prior to being entitled to any indemnity hereunder.
11. Miscellaneous.
(a) Entire Agreement. This Agreement constitutes the entire agreement
between the parties with respect to the subject matter hereof and supersedes
all other prior agreements and understandings, both written and oral, between
the parties with respect to the subject matter hereof.
(b) Binding Agreement. This Agreement and the obligations hereunder shall
attach to the Shares and shall be binding upon any person or entity to which
legal or beneficial ownership of such Shares shall pass, whether by operation
of law or otherwise. Notwithstanding any voluntary transfer of Shares, the
transferor shall remain liable for the performance of all obligations under
this Agreement of the transferor.
(c) Assignment. This Agreement shall not be assigned by operation of law
or otherwise without the prior written consent of the other parties, provided
that Parent may assign, in its sole discretion, its rights and obligations
hereunder to any direct or indirect wholly owned subsidiary of Parent, but no
such assignment shall relieve Parent of its obligations hereunder if such
assignee does not perform such obligations.
9
(d) Amendments, Waivers, Etc. This Agreement may not be amended, changed,
supplemented, waived or otherwise modified or terminated, except upon the
execution and delivery of a written agreement executed by the parties hereto.
(e) Notices. All notices, requests, claims, demands and other
communications hereunder shall be in writing and shall be given (and shall be
deemed to have been duly received if given) by hand delivery or telecopy (with
a confirmation copy sent for next day delivery via courier service, such as
Federal Express), or by any courier service, such as Federal Express, providing
proof of delivery. All communications hereunder shall be delivered to the
respective parties at the following addresses:
If to Shareholder:
Telephone No.:
Telecopy No.:
If to Parent or PCA International, Inc.
the Purchaser: 000 Xxxxxxxx - Xxxx Xxxx Xxxx
Xxxxxxxx, Xxxxx Xxxxxxxx 00000
Attention: Xxxx Xxxxxx
Telephone No.: (000) 000-0000
Telecopy No.: (000) 000-0000
copy to: Xxxxxxx Xxxx & Xxxxx LLP
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxx Xxxxxxxxxx, Esq.
Telephone No.: (000) 000-0000
Telecopy No.: (000) 000-0000
or to such other address as the person to whom notice is given may have
previously furnished to the others in writing in the manner set forth above.
(f) Severability. Whenever possible, each provision or portion of any
provision of this Agreement will be interpreted in such manner as to be
effective and valid under applicable law but if any provision or portion of any
provision of this Agreement is held to be invalid, illegal or unenforceable in
any respect under any applicable law or rule in any jurisdiction, such
invalidity, illegality or unenforceability will not affect any other provision
or portion of any provision in such jurisdiction, and this Agreement will be
reformed, construed and
10
enforced in such jurisdiction as if such invalid, illegal or unenforceable
provision or portion of any provision had never been contained herein.
(g) Specific Performance. Each of the parties hereto recognizes and
acknowledges that a breach by it of any covenants or agreements contained in
this Agreement will cause the other party to sustain damages for which it would
not have an adequate remedy at law for money damages, and therefore in the
event of any such breach the aggrieved party shall be entitled to the remedy of
specific performance of such covenants and agreements and injunctive and other
equitable relief in addition to any other remedy to which it may be entitled,
at law or in equity.
(h) Remedies Cumulative. 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, and the exercise of any thereof by any
party shall not preclude the simultaneous or later exercise of any other such
right, power or remedy by such party.
(i) No Waiver. The failure of any party hereto to exercise any right,
power or remedy provided under this Agreement or otherwise available in respect
hereof at law or in equity, or to insist upon compliance by any other party
hereto with its obligations hereunder, and any custom or practice of the
parties at variance with the terms hereof, shall not constitute a waiver by
such party of its right to exercise any such or other right, power or remedy or
to demand such compliance.
(j) No Third Party Beneficiaries. This Agreement is not intended to be
for the benefit of, and shall not be enforceable by, any person or entity who
or which is not a party hereto.
(k) Governing Law. This Agreement shall be governed and construed in
accordance with the laws of the State of North Carolina, without giving effect
to the principles of conflicts of law thereof.
(l) Descriptive Headings. The descriptive headings used herein are
inserted for convenience of reference only and are not intended to be part of
or to affect the meaning or interpretation of this Agreement.
(m) Counterparts. This Agreement may be executed in counterparts, each of
which shall be deemed to be an original, but all of which, taken together,
shall constitute one and the same Agreement.
11
IN WITNESS WHEREOF, Parent, the Purchaser and the Shareholder have caused
this Agreement to be duly executed as of the day and year first above written.
PCA INTERNATIONAL, INC.
By:
-------------------------------
Name:
Title:
ASI ACQUISITION CORP.
By:
-------------------------------
Name:
Title:
-----------------------------------
12
SCHEDULE I
Shareholder Number of Shares
----------- ----------------
13
FORM OF STOCK AGREEMENT WITHOUT PURCHASE OPTION
STOCK AGREEMENT, dated as of December __, 1996, among PCA International,
Inc., a North Carolina corporation ("Parent"), ASI Acquisition Corp., a North
Carolina corporation and a direct wholly owned subsidiary of Parent (the
"Purchaser"), and __________________ (the "Shareholder").
W I T N E S S E T H:
WHEREAS, concurrently with the execution and delivery of this Agreement,
Parent, the Purchaser and American Studios, Inc., a North Carolina corporation
(the "Company"), have entered into an Agreement and Plan of Merger (as such
agreement may hereafter be amended from time to time, the "Merger Agreement"),
pursuant to which the Purchaser will be merged with and into the Company (the
"Merger") (capitalized terms used and not defined herein have the respective
meanings ascribed to them in the Merger Agreement);
WHEREAS, in furtherance of the Merger, as soon as practicable (and not
later than five business days) after the execution and delivery of the Merger
Agreement, Purchaser shall commence a cash tender offer (the "Offer") to
purchase at a price of $2.50 per share all outstanding shares of Company Common
Stock (as defined in Section 1 hereof) including all of the Shares (as defined
in Section 2 hereof) beneficially owned by the Shareholder; and
WHEREAS, as an inducement and a condition to entering into the Merger
Agreement, Parent has required that the Shareholder agree, and the Shareholder
has agreed, to enter into this Agreement;
NOW, THEREFORE, in consideration of the foregoing and the mutual premises,
representations, warranties, covenants and agreements contained herein, the
parties hereto, intending to be legally bound hereby, agree as follows:
1. Definitions. For purposes of this Agreement:
(a) "Beneficially Own" or "Beneficial Ownership" with respect to any
securities shall mean having "beneficial ownership" of such securities (as
determined pursuant to Rule 13d-3 under the Securities Exchange Act of 1934, as
amended (the "Exchange Act")), including pursuant to any agreement, arrangement
or understanding, whether or not in writing. 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" as within the meaning of Section
13(d)(3) of the Exchange Act.
(b) "Company Common Stock" shall mean at any time the common stock, $.00l
par value, of the Company.
14
(c) "Person" shall mean an individual, corporation, partnership, joint
venture, association, trust, unincorporated organization or other entity.
2. Tender of Shares.
(a) In order to induce Parent and the Purchaser to enter into the Merger
Agreement, the Shareholder hereby agrees to validly tender (or cause the record
owner of such shares to validly tender), and not to withdraw, pursuant to and
in accordance with the terms of the Offer, not later than the fifth business
day after commencement of the Offer pursuant to Section 1.1 of the Merger
Agreement and Rule 14d-2 under the Exchange Act, the number of shares of
Company Common Stock set forth opposite such Shareholder's name on Schedule I
hereto (the "Existing Shares", and together with any shares acquired by the
Shareholder in any capacity after the date hereof and prior to the termination
of this Agreement whether upon the exercise of options, warrants or rights, the
conversion or exchange of convertible or exchangeable securities, or by means
of purchase, dividend, distribution or otherwise, the "Shares"), all of which
are Beneficially Owned by the Shareholder. The Shareholder hereby acknowledges
and agrees that Xxxxxx's and the Purchaser's obligation to accept for payment
and pay for Shares in the Offer, including the Shares Beneficially Owned by
such Shareholder, is subject to the terms and conditions of the Offer.
(b) The transfer by the Shareholder of the Shares to the Purchaser in the
Offer shall pass to and unconditionally vest in the Purchaser good and valid
title to the Shares, free and clear of all claims, liens, restrictions,
security interests, pledges, limitations and encumbrances whatsoever.
(c) The Shareholder hereby permits Parent and the Purchaser to publish and
disclose in the Offer Documents and, if approval of the Company's shareholders
is required under applicable law, the Proxy Statement (including all documents
and schedules filed with the SEC) its identity and ownership of the Company
Common Stock and the nature of its commitments, arrangements and understandings
under this Agreement.
3. Provisions Concerning the Company Common Stock. During the period
commencing on the date hereof and continuing until the first to occur of the
Effective Time or termination of the Merger Agreement in accordance with its
terms, the Shareholder shall, at any meeting of the holders of Company Common
Stock, however called, or in connection with any written consent of the holders
of Company Common Stock, vote (or cause to be voted) the Shares (if any) then
held of record or Beneficially Owned by the Shareholder, (i) in favor of the
Merger, the execution and delivery by the Company of the Merger Agreement and
the approval of the terms thereof and each of the other actions contemplated by
the Merger Agreement and this Agreement and any actions required in furtherance
thereof and hereof; (ii) against any action or agreement that would result in a
breach in any respect of any covenant, representation or warranty or any other
obligation or agreement of the Company under the Merger Agreement; and (iii)
except as otherwise agreed to in writing in advance by Parent, against the
following actions (other than the Merger and the transactions contemplated by
the Merger Agreement): (A) any extraordinary corporate transaction, such as a
merger, consolidation or other business
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combination involving the Company or its Subsidiaries; (B) a sale, lease or
transfer of a material amount of assets of the Company or its Subsidiaries, or
a reorganization, recapitalization, dissolution or liquidation of the Company
or its Subsidiaries; (C)(1) any change in a majority of the persons who
constitute the board of directors of the Company; (2) any change in the present
capitalization of the Company or any amendment of the Company's Articles of
Incorporation or Bylaws; (3) any other material change in the Company's
corporate structure or business; or (4) any other action which, in the case of
each of the matters referred to in clauses (iii)(C)(1), (2) or (3) of this
Section 4, is intended, or could reasonably be expected, to impede, interfere
with, delay, postpone, or materially adversely affect the Merger and the
actions and transactions contemplated by this Agreement and the Merger
Agreement. The Shareholder shall not enter into any agreement or understanding
with any person or entity the effect of which would be inconsistent or
violative of the provisions and agreements contained in this Section 4.
4. Covenants, Representations and Warranties of the Shareholder. The
Shareholder hereby represents and warrants to Parent as follows:
(a) Ownership of Shares. The Shareholder is the Beneficial Owner of the
Shares, as set forth on Schedule 1. On the date hereof, the Existing Shares
constitute all of the outstanding Shares owned of record or Beneficially Owned
by the Shareholder. The Shareholder has sole voting power and sole power to
issue instructions with respect to the matters set forth in Sections 2 and 4
hereof, sole power of disposition, sole power to demand appraisal rights and
sole power to agree to all of the matters set forth in this Agreement, in each
case with respect to all of the Existing Shares with no limitations,
qualifications or restrictions on such rights, subject to applicable securities
laws and the terms of this Agreement.
(b) Power; Binding Agreement. The Shareholder has the legal capacity,
power and authority to enter into and perform all of his obligations under this
Agreement. The execution, delivery and performance of this Agreement by the
Shareholder will not violate any other agreement to which the Shareholder is a
party including, without limitation, any voting agreement, proxy arrangement,
pledge agreement, shareholders agreement or voting trust. This Agreement has
been duly and validly executed and delivered by the Shareholder and constitutes
a valid and binding agreement of the Shareholder, enforceable against the
Shareholder in accordance with its terms. There is no beneficiary or holder of
a voting trust certificate or other interest of any trust of which the
Shareholder is a trustee whose consent is required for the execution and
delivery of this Agreement or the consummation by such Shareholder of the
transactions contemplated hereby.
(c) No Conflicts. Except for (i) filings under the HSR Act and the
Exchange Act, (A) no filing with, and no permit, authorization, consent or
approval of, any state or federal public body or authority is necessary for the
execution of this Agreement by the Shareholder and the consummation by the
Shareholder of the transactions contemplated hereby and (B) none of the
execution and delivery of this Agreement by the Shareholder, the consummation
by the Shareholder of the transactions contemplated hereby or compliance by the
Shareholder with any of the provisions hereof shall (1) conflict with or result
in any breach of any applicable organizational documents applicable to the
Shareholder, (2) result in a violation or breach of, or
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16
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 note, loan agreement, bond, mortgage, indenture, license, contract,
commitment, arrangement, understanding, agreement or other instrument or
obligation of any kind to which the Shareholder is a party or by which the
Shareholder or any of its properties or assets may be bound, or (3) violate any
order, writ, injunction, decree, judgment, order, statute, rule or regulation
applicable to the Shareholder or any of its properties or assets.
(d) No Encumbrances. Except as permitted by this Agreement, the Shares
and the certificates representing such Shares are now, and at all times during
the term hereof will be, held by the Shareholder, or by a nominee or custodian
for the benefit of such Shareholder, free and clear of all liens, claims,
security interests, proxies, voting trusts or agreements, understandings or
arrangements or any other encumbrances whatsoever, except for any such
encumbrances or proxies arising hereunder.
(e) No Finder's Fees. No broker, investment banker, financial advisor or
other person is entitled to any broker's, finder's, financial adviser's or
other similar fee or commission in connection with the transactions
contemplated hereby based upon arrangements made by or on behalf of the
Shareholder.
(f) No Solicitation. The Shareholder shall not, in the capacity as a
shareholder or otherwise, directly or indirectly, solicit (including by way of
furnishing information) or negotiate in response to any inquiries or the making
of any proposal by any person or entity (other than Parent or any affiliate of
Parent) concerning any merger, tender offer, exchange offer, sale of assets,
sale of shares of capital stock or debt securities or similar transactions
involving the Company or any Subsidiary, division or operating or principal
business unit of the Company. If the Shareholder receives any such inquiry or
proposal, then the Shareholder shall promptly inform Parent of the existence
thereof. The Shareholder will immediately cease and cause to be terminated any
existing activities, discussions or negotiations with any parties conducted
heretofore with respect to any of the foregoing. Notwithstanding the
foregoing, nothing herein shall prevent the Shareholder from complying with any
fiduciary duties it may have in its capacity as an officer and/or director of
the Company.
(g) Restriction on Transfer, Proxies and Non-Interference. The
Shareholder shall not, directly or indirectly: (i) except as applicable in
connection with the transactions contemplated by Section 2 hereof, offer for
sale, sell, transfer, tender, pledge, encumber, assign or otherwise dispose of,
or enter into any contract, option or other arrangement or understanding with
respect to or consent to the offer for sale, sale, transfer, tender, pledge,
encumbrance, assignment or other disposition of, any or all of the Shares or
any interest therein (any such transaction, a "Transfer"), except that
Shareholder may transfer Shares to a family member of such Shareholder or a
charitable organization provided such transferee agrees to be bound by the
provisions of this Agreement; (ii) except as contemplated by this Agreement,
grant any proxies or powers of attorney, deposit the Shares into a voting trust
or enter into a voting agreement with respect to the Shares; or (iii) take any
action that would make any representation or warranty of
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the Shareholder contained herein untrue or incorrect or have the effect of
preventing or disabling the Shareholder from performing its obligations under
this Agreement.
(h) Reliance by Xxxxxx. The Shareholder understands and acknowledges that
Parent is entering into, and causing Purchaser to enter into, the Merger
Agreement in reliance upon the Shareholder's execution and delivery of this
Agreement.
(i) Waiver of Appraisal Rights. The Stock holder hereby waives any rights
of appraisal or rights to dissent from the Merger that such Shareholder may
have.
(j) Access to Information. The Shareholder represents and warrants that,
in connection with the execution and delivery of this Agreement, the
Shareholder has been afforded the full opportunity to ask questions and receive
information regarding the Offer and the terms of the Merger Agreement and the
transactions contemplated thereby and the interests of any affected party.
5. Covenants, Representations and Warranties of Parent and the Purchaser.
Each of Parent and the Purchaser hereby represents and warrants to the
Shareholder as follows:
(a) Power; Binding Agreement. Parent and the Purchaser each has the
corporate power and authority to enter into and perform all of its obligations
under this Agreement. The execution, delivery and performance of this
Agreement by the each of the Parent and the Purchaser will not violate any
other agreement to which either of them is a party. This Agreement has been
duly and validly executed and delivered by each of the Parent and the Purchaser
and constitutes a valid and binding agreement of each of the Parent and the
Purchaser, enforceable against each of the Parent and the Purchaser in
accordance with its terms.
(b) No Conflicts. Except for (i) filings under the HSR Act and the
Exchange Act, (A) no filing with, and no permit, authorization, consent or
approval of, any state or federal public body or authority is necessary for the
execution of this Agreement by each of the Parent and the Purchaser and the
consummation by each of the Parent and the Purchaser of the transactions
contemplated hereby and (B) none of the execution and delivery of this
Agreement by each of the Parent and the Purchaser, the consummation by each of
the Parent and the Purchaser of the transactions contemplated hereby or
compliance by each of the Parent and the Purchaser with any of the provisions
hereof shall (1) conflict with or result in any breach of any applicable
organizational documents applicable to either of the Parent or the Purchaser,
(2) 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 note, loan agreement, bond,
mortgage, indenture, license, contract, commitment, arrangement, understanding,
agreement or other instrument or obligation of any kind to which either of the
Parent or the Purchaser is a party or by which either of the Parent or the
Purchaser or any of their properties or assets may be bound, or (3) violate any
order, writ, injunction, decree, judgment, order, statute, rule or regulation
applicable to either of the Parent or the Purchaser or any of their properties
or assets.
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18
(c) No Finder's Fees. No broker, investment banker, financial advisor or
other person is entitled to any broker's, finder's, financial adviser's or
other similar fee or commission in connection with the transactions
contemplated hereby based upon arrangements made by or on behalf of either of
the Parent or the Purchaser.
6. Further Assurances. From time to time, at the other party's request
and without further consideration, each party hereto shall execute and deliver
such additional documents and take all such further lawful action as may be
necessary or desirable to consummate and make effective, in the most
expeditious manner practicable, the transactions contemplated by this
Agreement.
7. Stop Transfer. The Shareholder shall not request that the Company
register the transfer (book-entry or otherwise) of any certificate or
uncertificated interest representing any of the Shares, unless such transfer is
made in compliance with this Agreement. In the event of a stock dividend or
distribution, or any change in the Company Common Stock by reason of any stock
dividend, split-up, recapitalization, combination, exchange of shares or the
like, the term "Shares" shall refer to and include the Shares as well as all
such stock dividends and distributions and any shares into which or for which
any or all of the Shares may be changed or exchanged.
8. Termination. Except for Section 10 hereof, and except as otherwise
provided herein, the covenants and agreements contained herein shall terminate
upon the termination of the Merger Agreement in accordance with its terms.
9. Indemnification. Parent shall indemnify, defend and hold harmless the
Shareholder from and against any and all losses, damages, liabilities and
expenses (including, without limitation but subject to the next sentence,
reasonable fees and expenses of outside counsel) resulting from any claim or
litigation arising out of the execution, delivery and performance by the
Shareholder of this Stock Agreement. The Shareholder shall give prompt written
notice to Parent upon the Shareholder becoming aware of any claim or action in
respect of which the Shareholder intends to seek indemnity hereunder, and
Parent shall by prompt written notice to the Shareholder be entitled to assume
the defense of such claim or action with counsel selected by the Parent and
reasonably acceptable to the Shareholder.
Notwithstanding the foregoing, if the undersigned is an officer and/or
director of the Company and the claim or litigation relates to the
undersigned's status or conduct as an officer and/or director as well as the
undersigned's execution, delivery and performance of this Stock Agreement as a
Shareholder, the undersigned shall first seek recourse under any other
indemnity or insurance coverage to which the undersigned may be entitled in
such other capacities prior to being entitled to any indemnity hereunder.
10. Miscellaneous.
(a) Entire Agreement. This Agreement constitutes the entire agreement
between the parties with respect to the subject matter hereof and supersedes
all other prior
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agreements and understandings, both written and oral, between the parties with
respect to the subject matter hereof.
(b) Binding Agreement. This Agreement and the obligations hereunder shall
attach to the Shares and shall be binding upon any person or entity to which
legal or beneficial ownership of such Shares shall pass, whether by operation
of law or otherwise. Notwithstanding any voluntary transfer of Shares, the
transferor shall remain liable for the performance of all obligations under
this Agreement of the transferor.
(c) Assignment. This Agreement shall not be assigned by operation of law
or otherwise without the prior written consent of the other parties, provided
that Parent may assign, in its sole discretion, its rights and obligations
hereunder to any direct or indirect wholly owned subsidiary of Parent, but no
such assignment shall relieve Parent of its obligations hereunder if such
assignee does not perform such obligations.
(d) Amendments, Waivers, Etc. This Agreement may not be amended, changed,
supplemented, waived or otherwise modified or terminated, except upon the
execution and delivery of a written agreement executed by the parties hereto.
(e) Notices. All notices, requests, claims, demands and other
communications hereunder shall be in writing and shall be given (and shall be
deemed to have been duly received if given) by hand delivery or telecopy (with
a confirmation copy sent for next day delivery via courier service, such as
Federal Express), or by any courier service, such as Federal Express, providing
proof of delivery. All communications hereunder shall be delivered to the
respective parties at the following addresses:
If to Shareholder:
Telephone No.:
Telecopy No.:
If to Parent or PCA International, Inc.
the Purchaser: 000 Xxxxxxxx - Xxxx Xxxx Xxxx
Xxxxxxxx, Xxxxx Xxxxxxxx 00000
Attention: Xxxx Xxxxxx
Telephone No.: (000) 000-0000
Telecopy No.: (000) 000-0000
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copy to: Xxxxxxx Xxxx & Xxxxx LLP
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxx Xxxxxxxxxx, Esq.
Telephone No.: (000) 000-0000
Telecopy No.: (000) 000-0000
or to such other address as the person to whom notice is given may have
previously furnished to the others in writing in the manner set forth above.
(f) Severability. Whenever possible, each provision or portion of any
provision of this Agreement will be interpreted in such manner as to be
effective and valid under applicable law but if any provision or portion of any
provision of this Agreement is held to be invalid, illegal or unenforceable in
any respect under any applicable law or rule in any jurisdiction, such
invalidity, illegality or unenforceability will not affect any other provision
or portion of any provision in such jurisdiction, and this Agreement will be
reformed, construed and enforced in such jurisdiction as if such invalid,
illegal or unenforceable provision or portion of any provision had never been
contained herein.
(g) Specific Performance. Each of the parties hereto recognizes and
acknowledges that a breach by it of any covenants or agreements contained in
this Agreement will cause the other party to sustain damages for which it would
not have an adequate remedy at law for money damages, and therefore in the
event of any such breach the aggrieved party shall be entitled to the remedy of
specific performance of such covenants and agreements and injunctive and other
equitable relief in addition to any other remedy to which it may be entitled,
at law or in equity.
(h) Remedies Cumulative. 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, and the exercise of any thereof by any
party shall not preclude the simultaneous or later exercise of any other such
right, power or remedy by such party.
(i) No Waiver. The failure of any party hereto to exercise any right,
power or remedy provided under this Agreement or otherwise available in respect
hereof at law or in equity, or to insist upon compliance by any other party
hereto with its obligations hereunder, and any custom or practice of the
parties at variance with the terms hereof, shall not constitute a waiver by
such party of its right to exercise any such or other right, power or remedy or
to demand such compliance.
(j) No Third Party Beneficiaries. This Agreement is not intended to be
for the benefit of, and shall not be enforceable by, any person or entity who
or which is not a party hereto.
(k) Governing Law. This Agreement shall be governed and construed in
accordance with the laws of the State of North Carolina, without giving effect
to the principles of conflicts of law thereof.
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(l) Descriptive Headings. The descriptive headings used herein are
inserted for convenience of reference only and are not intended to be part of
or to affect the meaning or interpretation of this Agreement.
(m) Counterparts. This Agreement may be executed in counterparts, each of
which shall be deemed to be an original, but all of which, taken together,
shall constitute one and the same Agreement.
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IN WITNESS WHEREOF, Parent, the Purchaser and the Shareholder have caused
this Agreement to be duly executed as of the day and year first above written.
PCA INTERNATIONAL, INC.
By:
---------------------------------
Name:
Title:
ASI ACQUISITION CORP.
By:
---------------------------------
Name:
Title:
-------------------------------------
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SCHEDULE I
Shareholder Number of Shares
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-11-
