STOCKHOLDER AGREEMENT
This STOCKHOLDER AGREEMENT (the "Agreement"), dated as of January 30,
1995, is among (a) CDI GROUP, INC., a Delaware corporation (the "Company"), (b)
BANCBOSTON VENTURES INC. ("BBV"), a Massachusetts corporation, (c) HARVEST
PARTNERS INTERNATIONAL, LP, HARVEST TECHNOLOGY PARTNERS, LP, EUROPEAN
DEVELOPMENT CAPITAL CORPORATION N.V. and DEUTSCHE BETEILIGUNGSGESELLSCHAFT MBH
(collectively, the "Initial Harvest Stockholders"), (d) BANQUE PARIBAS
("Paribas"), (e) PARIBAS PRINCIPAL, INC. ("PPI"), (f) TA HOLDING, INC. ("TA"),
(g) Xxx Xxxxxxxx, (h) Xxxxx Xxxxxxx and any other officer, employee or director
of the Company who becomes a party to this Agreement by executing an Instrument
of Accession ("Instrument of Accession") in the form of Schedule 1 hereto
(collectively, the "Managers") and (i) each other Person who becomes a party to
this Agreement by executing an Instrument of Accession.
WHEREAS, the parties hereto wish to set forth their relative rights
with regard to the transfer and issuance of the Company's securities, election
of the Company's Board of Directors and certain other matters concerning the
Company's capital stock;
NOW, THEREFORE, the parties to this Agreement hereby agree as follows:
ss.1. DEFINITIONS. For all purposes of this Agreement, the following
terms shall have the meanings set forth below:
Acquisition Offer. See Section 3.2(a).
Affiliate. Affiliate shall mean, with respect to any Stockholder, any
Person directly or indirectly controlling, controlled by or under direct or
indirect common control with such Stockholder and shall include (a) any Person
who is a director or beneficial holder of at least 5% of the then outstanding
capital stock (or partnership interests or other shares of beneficial interest)
of such Stockholder and Family Members of any such Person, (b) any Person of
which such Stockholder or an Affiliate (as defined in clause (a) above) of such
Stockholder directly or indirectly, either beneficially owns at least 5% of the
then outstanding capital stock (or partnership
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interests or other shares of beneficial interest) or constitutes at least a 5%
equity participant, (c) any Person of which an Affiliate (as defined in clause
(a) above) of such Stockholder is a partner, director, officer or executive
employee, and (d) in the case of a specified Person who is an individual, the
Family Members of such Person.
Approved Sale. See Section 3.3.
BBV. See preamble.
BBV Securities. BBV Securities shall mean (a) the shares of Common
Stock and Preferred Stock purchased by BBV pursuant to the Investor Purchase
Agreement, (b) all other shares of the Company's capital stock purchased by or
issued from time to time to BBV, (c) all shares of the Company's capital stock
issued with respect to such shares by way of stock dividend or stock split or in
connection with any merger, consolidation, recapitalization or other
reorganization affecting the Company's capital stock and (d) the Notes purchased
by BBV pursuant to the Investor Purchase Agreement. BBV Securities will continue
to be BBV Securities in the hands of any holder and each transferee thereof will
succeed to the rights and obligations of a holder of BBV Securities hereunder,
provided that BBV Securities will cease to be BBV Securities when transferred
(i) to the Company, or (ii) pursuant to a Public Sale.
BBV Stockholder. BBV Stockholder shall mean BBV for so long as BBV
holds BBV Securities and any other Person to whom BBV Securities are transferred
in accordance with the provisions hereof for so long as such Person holds any
BBV Securities.
Charter. Charter shall mean the Company's Certificate of Incorporation
and all amendments thereto.
Class A Common Stock. See definition of "Common Stock."
Class B Common Stock. See definition of "Common Stock."
Common Stock. Common Stock shall mean (a) the Company's Class A Voting
Common Stock $.00001 par value per share, (the "Class A Common Stock"), (b) the
Company's Class B Non-Voting Common Stock $.00001 par value per share, (the
"Class B Common Stock"), and (c) any shares of any other class of capital stock
of the Company hereafter issued which is (i) not preferred as to dividends or
assets over any class of stock of the Company, (ii) not subject to redemption
pursuant to the terms thereof, or (iii) issued to the holders of shares of
Common Stock upon any reclassification thereof.
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Company. See preamble.
Family Members. Family Members shall mean, as applied to any
individual, any parent, spouse, child, grandchildren, spouse of a child, and
each trust created for the benefit of one or more of such Persons and each
custodian of a property of one or more such Persons.
Harvest Securities. Harvest Securities shall mean (a) all shares of
Common Stock and Preferred Stock purchased by the Initial Harvest Stockholders
pursuant to the Investor Purchase Agreement, (b) all other shares of the
Company's capital stock purchased by or issued from time to time to the Initial
Harvest Stockholders, (c) all shares of the Company's capital stock issued with
respect to such shares by way of stock dividend or stock split or in connection
with any merger, consolidation, recapitalization or other reorganization
affecting the Company's capital stock and (d) the Notes purchased by the Initial
Harvest Stockholders pursuant to the Investor Purchase Agreement. Harvest
Securities will continue to be Harvest Securities in the hands of any holder and
each transferee thereof will succeed to the rights and obligations of a holder
of Harvest Securities hereunder, provided that Harvest Securities will cease to
be Harvest Securities when transferred (i) to the Company, or (ii) pursuant to a
Public Sale.
Harvest Stockholder. Harvest Stockholder shall mean each of the Initial
Harvest Stockholders for so long as such Initial Harvest Stockholder holds
Harvest Securities and any other Person to whom Harvest Securities are
transferred in accordance with the provisions hereof for so long as such Person
holds any Harvest Securities.
Initial Harvest Stockholders. See preamble.
Initiating Stockholder. See Section 3.1.
Instrument of Accession. Instrument of Accession shall mean an
Instrument of Accession in the form of Schedule 1 hereto.
Investor Purchase Agreement. Investor Purchase Agreement shall mean the
Investor Securities Purchase Agreement of even date herewith among the Company,
BBV and the Initial Harvest Stockholders.
Investor Stockholders. Investor Stockholders shall mean, collectively,
the BBV Stockholders, the Harvest Stockholders, the Paribas Stockholders and the
TA Stockholders.
Liquidation Value. Liquidation Value shall have the meaning assigned to
such term in the Charter.
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Major Holder. Major Holder shall mean the holder or holders, together
with such holder's Affiliates, at the relevant time of determination (excluding
the Company) of at least three percent (3%) of the then outstanding shares of
Common Stock on a fully-diluted basis (assuming exercise of all outstanding
warrants, options and convertible securities, including those held by the holder
with respect to which the determination is being made); provided that in any
event each of the Initial Harvest Stockholders shall be deemed to be a Major
Holder hereunder at any time of determination if at such time the Initial
Harvest Stockholders collectively hold at least three percent (3%) of the then
outstanding shares of Common Stock on a fully-diluted basis (assuming exercise
of all outstanding warrants, options and convertible securities, including those
held by the holder with respect to which the determination is being made).
Management Option Agreement. Management Option Agreement shall mean the
Option Agreement of even date herewith among BBV, the Initial Harvest
Stockholders and Xxxxx Xxxxxxx, on behalf of the other Managers, pursuant to
which each of BBV and the Initial Harvest Stockholders have granted certain
options to such Managers to purchase the number of shares of Common Stock and
Preferred Stock specified therein during the period from the date hereof until
July 31, 1995.
Management Purchase Agreement. Management Purchase Agreement shall mean
the Management Securities Purchase Agreement between the Company and Xxxxx
Xxxxxxx.
Management Securities. Management Securities shall mean (a) the shares
of Common Stock and Preferred Stock purchased by Xxxxx Xxxxxxx pursuant to the
Management Purchase Agreement, (b) the shares of Common Stock and Preferred
Stock sold to the Managers pursuant to the exercise of the option under the
Management Option Agreement, (c) the shares of Common Stock issued or issuable
upon exercise of options granted by the Company to the Managers, (d) all other
shares of the Company's capital stock purchased by or issued from time to time
to the Managers and (e) all shares of the Company's capital stock issued with
respect to such shares by way of stock dividend or stock split or in connection
with any merger, consolidation, recapitalization or other reorganization
affecting the Company's capital stock. Management Securities will continue to be
Management Securities in the hands of any holder and each transferee thereof
will succeed to the rights and obligations of a holder of Management Securities
hereunder, provided that shares of Management Securities will cease to be
Management Securities when transferred (i) to the Company, or (ii) pursuant to a
Public Sale.
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Management Stockholder. Management Stockholder shall mean each Manager
for so long as such Manager holds Management Securities and any other Person to
whom Management Securities are transferred in accordance with the provisions
hereof for so long as such Person holds any Management Securities.
Manager. See preamble.
Non-Initiating Stockholder. See Section 3.2(a).
Non-Transferring Stockholder. See Section 2.2.
Notes. Notes shall mean the Company's Senior Subordinated Notes in the
aggregate principal amount of $13,250,000, issued to the Investor Stockholders
pursuant to the Investor Purchase Agreement, the TA Subscription Agreement, the
Tietbohl Subscription Agreement, and upon exercise by PPI of the option under
the Paribas Option Agreement.
Offer Notice. See Section 2.2.
Offer Price Per Security. The Offer Price Per Security shall mean, (a)
in the case of each share of Common Stock, the quotient obtained by dividing (i)
the amount of the Acquisition Offer, by (ii) the sum of the number of shares of
Common Stock then outstanding, plus the number of shares of Common Stock then
issuable upon exercise of then outstanding and exercisable warrants, options or
convertible securities, (b) in the case of each share of Preferred Stock, the
Liquidation Value of such share and (c) in the case of each Note, the
outstanding principal amount of such Note plus all accrued and unpaid interest
thereon.
Paribas. See preamble.
Paribas Option Agreement. Paribas Option Agreement shall mean the
Option Agreement of even date herewith among BBV, the Initial Harvest
Stockholders and PPI.
Paribas Securities. Paribas Securities shall mean (a) all shares of
Common Stock purchased by PPI pursuant to the exercise by PPI of its option
under the Paribas Option Agreement, (b) the Paribas Warrants, (c) the Paribas
Warrant Shares, (d) all other shares of the Company's capital stock purchased by
or issued from time to time to Paribas or PPI, (e) all shares of the Company's
capital stock issued with respect to such shares by way of stock dividend or
stock split or in connection with any merger, consolidation, recapitalization or
other reorganization affecting the Company's capital stock and (f) the Notes
purchased by Paribas pursuant to the exercise by PPI of its
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option under the Paribas Option Agreement. Paribas Securities will continue to
be Paribas Securities in the hands of any holder and each transferee thereof
will succeed to the rights and obligations of a holder of Paribas Securities
hereunder, provided that Paribas Securities will cease to be Paribas Securities
when transferred (i) to the Company, or (ii) pursuant to a Public Sale.
Paribas Stockholder. Paribas Stockholder shall mean Paribas and PPI for
so long as Paribas or PPI holds Paribas Securities and any other Person to whom
Paribas Securities are transferred in accordance with the provisions hereof for
so long as such Person holds any Paribas Securities.
Paribas Warrant Agreement. Paribas Warrant Agreement shall mean the
Warrant Agreement of even date herewith between the Company and Paribas.
Paribas Warrant Shares. Paribas Warrant Shares shall mean all shares of
Common Stock issued or issuable upon exercise of the Paribas Warrants in
accordance with their terms.
Paribas Warrants. Paribas Warrants shall mean the warrants of the
Company issued to Paribas pursuant to the Paribas Warrant Agreement as in effect
on the date hereof and any warrants issued upon transfer, exchange or
replacement thereof.
Person. Person shall mean an individual, partnership, corporation,
association, trust, joint venture, unincorporated organization, or any
government, governmental department or agency or political subdivision thereof.
PPI. See preamble.
Preferred Stock. Preferred Stock shall mean the Preferred Stock, $1.00
par value per share, of the Company.
Principal Stockholders. Principal Stockholders shall mean the BBV
Stockholders and the Harvest Stockholders.
Public Sale. Public Sale shall mean any sale of Common Stock to the
public pursuant to a public offering registered under the Securities Act of
1933, as amended, or to the public through a broker or market-maker pursuant to
the provisions of Rule 144 (or any successor rule) adopted under the Securities
Act of 1933, as amended.
Put Notice. See Section 3.2(a).
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Qualified Public Offering. Qualified Public Offering shall mean the
Company's underwritten public offering pursuant to an effective registration
statement under the Securities Act covering the offer and sale of shares of
Common Stock in which not less than $20,000,000 of gross proceeds from such
public offering are received by the Company for the account of the Company.
Sale Notice. See Section 3.1.
Securities. Securities shall mean the BBV Securities, the Harvest
Securities, the Paribas Securities, the Management Securities and the TA
Securities.
Stockholder Election Period. See Section 2.2.
Stockholders. Stockholders shall mean, collectively, the Investor
Stockholders and the Management Stockholders.
Subsidiary. Subsidiary shall mean any corporation, association, trust,
or other business entity, of which the designated parent shall at any time own
or control directly or indirectly through a Subsidiary or Subsidiaries at least
a majority (by number of votes) of the outstanding shares of capital stock (or
other shares of beneficial interest) entitled ordinarily to vote for the
election of such business entity's directors (or in the case of a business
entity that is not a corporation, for those Persons exercising functions similar
to directors of a corporation).
TA. See preamble.
TA Securities. TA Securities shall mean (a) all shares of Common Stock
purchased by TA pursuant to the TA Subscription Agreement, (b) the shares of
Common Stock purchased by Xxx Xxxxxxxx pursuant to the Subscription Agreement of
even date herewith between the Company and Xxx Xxxxxxxx, (c) all shares of the
Company's capital stock issued with respect to such shares by way of stock
dividend or stock split or in connection with any merger, consolidation,
recapitalization or other reorganization affecting the Company's capital stock,
(d) the Notes purchased by Xxx Xxxxxxxx pursuant to the Tietbohl Subscription
Agreement and (e) the Notes purchased by TA pursuant to the TA Subscription
Agreement. TA Securities will continue to be TA Securities in the hands of any
holder and each transferee thereof will succeed to the rights and obligations of
a holder of TA Securities hereunder, provided that TA Securities will cease to
be TA Securities when transferred (i) to the Company or (ii) pursuant to a
Public Sale.
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TA Stockholders. TA Stockholder shall mean each of TA and Xxx Xxxxxxxx
for so long as such Persons hold TA Securities and any other Person to whom TA
Securities are transferred in accordance with the provisions hereof for so long
as such Person holds any TA Securities.
TA Subscription Agreement. TA Subscription Agreement shall mean the
Subscription Agreement of even date herewith between the Company and TA.
Tietbohl Subscription Agreement. Tietbohl Subscription Agreement shall
mean the Subscription Agreement of even date herewith between the Company and
Xxx Xxxxxxxx.
Transferring Stockholder. See Section 2.3. Transfer. See Section 2.1.
ss.2. RESTRICTIONS ON TRANSFER OF SECURITIES.
2.1. Transfer. No Stockholder may sell, assign, pledge or otherwise
transfer (a "Transfer") any interest in any Securities, either voluntarily or
involuntarily, by operation of law or otherwise, except (a) in the case of any
Management Stockholder in a sale or transfer that is permitted or required
pursuant to the Management Purchase Agreement, (b) in the case of any Investor
Stockholder, to (i) its Affiliates, (ii) the Company to the extent such Transfer
is approved in accordance with the provisions of Section 4 hereof and is
permitted under Section 6.6 of the Investor Purchase Agreement or (iii) pursuant
to Section 2.4 hereof, (c) in the case of any Principal Stockholder, (i) up to
26,571 shares of Common Stock and 6,643 shares of Preferred Stock to the
Managers pursuant to the Management Option Agreement, (ii) pursuant to Section
3.2 hereof, or (iii) up to 40,000 shares of Common Stock and Notes in an
aggregate principal amount not to exceed $1,400,000 to PPI pursuant to the
Paribas Option Agreement, (d) at any time after the fifth anniversary hereof, to
any other Person so long as such Stockholder has complied with the provisions of
Sections 2.2 and, except in the case of the Paribas Stockholders, 2.3 hereof for
such Transfer, (e) pursuant to a Public Sale or an Approved Sale pursuant to
Section 3.3 hereof, (f) in the case of any Paribas Stockholder, (i) to any
member of the consolidated group of Compagnie Financiere de Paribas or any
officer or employee of any member of the consolidated group of Compagnie
Financiere de Paribas or (ii) pursuant to Section 3.2 hereof, or (g) in the case
of any Paribas Stockholder holding Paribas Warrants or Paribas Warrant Shares,
the Paribas Warrants and the Paribas Warrant Shares in accordance with Section
5 of the Paribas Warrants; provided that (x) the restrictions contained in this
Section 2 will continue to be applicable to the Securities
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after any Transfer pursuant to clauses (a) (other than a Transfer to the
Company), (b)(i), (b)(iii), (c), (d), (f) or (g) above, and (y) the transferee
of such Securities pursuant to clause (x) above shall have executed and
delivered an Instrument of Accession.
2.2. First Right of Purchase. Any Stockholder making any Transfer of
Securities pursuant to clause (d) of Section 2.1 shall comply with the
provisions of this Section 2.2 and 2.3 hereof. At least 45 days prior to any
such Transfer, the transferring Stockholder (the "Transferring Stockholder")
will deliver a written notice (the "Offer Notice") to the Company and to each of
the other Stockholders (the "Non-Transferring Stockholders"). The Offer Notice
will disclose in reasonable detail the proposed number of Securities to be
transferred, the class or classes of such Securities and the type of such
Securities, the proposed price, terms and conditions of the Transfer and the
identity of the transferee. The Non-Transferring Stockholders may elect to
purchase all (but not less than all) of the Securities specified in the Offer
Notice at the price and on the terms specified therein by delivering written
notice of such election to the Transferring Stockholder within 30 days after the
delivery of such Offer Notice (the "Stockholder Election Period"). If any
Non-Transferring Stockholders elect to purchase all of such Securities, the
Transfer of the Securities will be consummated within 15 days after the
expiration of the Stockholder Election Period. If more than one Non-Transferring
Stockholder elects to purchase all of the Securities of any type or class to be
transferred, each Non-Transferring Stockholder electing to purchase such
Securities will be entitled to purchase from the Transferring Stockholder a pro
rata portion (based upon the respective numbers of shares of Common Stock then
held by such Non-Transferring Stockholders (on a fully-diluted basis treating
all classes of Common Stock as a single class) of the Securities of such type or
class (treating all classes of Common Stock as a single class) proposed to be
transferred. If none of the Non-Transferring Stockholders elects to purchase all
of the Securities being offered, the Transferring Stockholder may, within 90
days after the expiration of the Stockholder Election Period, complete the
Transfer of the Securities specified in the Offer Notice at a price and on terms
no more favorable to the transferees than the price and terms offered to the
Non-Transferring Stockholders in the Offer Notice, provided that no such
Transfer may be completed except in compliance with Section 2.3 and unless each
of such transferees shall have executed and delivered an Instrument of Accession
as a condition precedent to the transfer thereof. If the Transferring
Stockholder fails to consummate such Transfer within the 90 day period after the
expiration of the Stockholder Election Period, any subsequent proposed Transfer
of the Securities shall be once again subject to the provisions of this Section
2.2.
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2.3. Participation Rights. In the event that the Non-Transferring
Stockholders fail to purchase the Securities specified in the Offer Notice, each
of the Non-Transferring Stockholders may elect to participate in any such
contemplated sale by any Transferring Stockholder other than the Paribas
Stockholders by delivering written notice to the Transferring Stockholder within
15 days after expiration of the Stockholder Election Period. If any of the
Non-Transferring Stockholders elects to participate in such sale, each of the
Transferring Stockholder and such participating Non-Transferring Stockholders
will be entitled to sell in the contemplated sale a number of Securities equal
to the product of (i) the fraction, the numerator of which is the number of
Securities of the type or class to be transferred (on a fully-diluted basis
treating all classes of Common Stock as a single class) held by such Person, and
the denominator of which is the aggregate number of Securities of the same type
or class (on a fully-diluted basis, treating all classes of Common Stock as a
single class) owned by the Transferring Stockholder and such participating
Non-Transferring Stockholders, multiplied by (ii) the number of Securities of
the same type or class (on a fully-diluted basis treating all classes of Common
Stock as a single class) to be sold in the contemplated sale.
For example, if the notice from the Transferring Stockholder
contemplated a sale of 100 shares of Common Stock by the Transferring
Stockholder and the Transferring Stockholder at such time owns 300
shares of Common Stock, and if one Non-Transferring Stockholder elects
to participate in such sale and such Non-Transferring Stockholder owns
200 shares of Common Stock (on a fully-diluted basis), such
Transferring Stockholder would be entitled to sell 60 shares (300/500 x
100 shares) and such Non-Transferring Stockholder would be entitled to
sell 40 shares (200/500 x 100 shares).
The Transferring Stockholder will use its best efforts to obtain the agreement
of the prospective transferee(s) to the participation of the Non-Transferring
Stockholders in any contemplated sale and will not transfer any of its
Securities to the prospective transferee(s) if the prospective transferee(s)
declines to allow the participation of the Non-Transferring Stockholders on the
terms specified herein. In addition, in any sale pursuant to this Section 2.3,
the Transferring Stockholder and any participating Non-Transferring Stockholder
shall receive the same form and amount of consideration per Security as is given
the other Non-Transferring Stockholders and the Transferring Stockholders, or if
any such Person is given an option as to the form and amount of consideration to
be received, all of such Persons will be given the same option, and no
Stockholder will be entitled to receive any economic benefits which are not made
available on a pro rata basis to all of
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the other Stockholders. In determining the amount of consideration per Security
payable to any Stockholder in connection with any sale pursuant to this Section
2.3, all consulting, noncompetition, investment banking or other fees payable to
such Stockholder in connection with such sale shall be deemed to be part of the
consideration to be paid to such Stockholder in connection with such sale (other
than any bona fide investment banking fees paid to the TA Stockholders in
connection with any investment banking or advisory services rendered by them in
connection with such sale).
2.4. Exempted Transfers. Notwithstanding any provision herein to the
contrary, any Investor Stockholder may Transfer Securities to the extent
required by governmental rule, law or regulation, or any directive or order of
any governmental authority.
2.5. Transfers of Securities in Breach of this Agreement. In the event
of any Transfer of Securities in breach of this Agreement, commencing
immediately upon the date of such attempted Transfer (a) such Transfer shall be
void and of no effect, (b) no dividend of any kind or any distribution pursuant
to any liquidation, redemption or otherwise shall be paid by the Company to the
purported transferee in respect of such Securities (all such rights to payment
by the transferring Stockholder and/or the purported transferee being deemed
waived), (c) the voting rights of such Securities, if any, shall terminate, and
(d) neither the transferring Stockholder nor the purported transferee shall be
entitled to exercise any rights with respect to such Securities until such
Transfer in breach of this Agreement has been rescinded.
ss.3. SALE OF THE COMPANY.
3.1. Initiation of Sale. At any time after January 30, 2000, the
holders of a majority of the shares of Common Stock included in BBV Securities
or the holders of a majority of the shares of Common Stock included in Harvest
Securities (the "Initiating Stockholders") shall have the right to initiate the
sale of the Company (whether by merger, consolidation, sale of all or
substantially all of its assets or sale of all of the outstanding Common Stock)
by giving written notice to the Company and the other Stockholders of their
desire to sell the Company (the "Sale Notice"). After receipt of the Sale
Notice, the Company's Board of Directors shall appoint an investment banking
firm of nationally recognized standing to deliver a written evaluation of the
Company's value and its prospects for sale, to give advice as to structuring the
sale as a sale of stock or assets and to assist the Company's Board of Directors
in conducting and negotiating the sale. All fees and expenses of such investment
banking firm shall be for the account of the Company. The investment banking
firm shall prepare a confidential information memorandum for presentation to
prospective purchasers and
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shall solicit offers for the acquisition of the Company. The Company and the
Stockholders hereby agree to cooperate fully in any sale initiated pursuant to
this Section 3.1 and not to take any action prejudicial to or inconsistent with
such sale. All offers to acquire the Company which are received by the
investment banking firm referred to above shall be submitted to the Company's
Board of Directors for consideration and shall be subject to the approval of the
Company's Board of Directors. The Initiating Stockholders shall not accept any
such offer received by the investment banking firm referred to above until it
has been approved by the Company's Board of Directors.
3.2. Sale of Initiating Stockholder's Securities. (a) If (i) the
investment banking firm retained by the Company's Board of Directors pursuant to
Section 3.1 shall have received a bona fide written offer from a third party who
is not an Affiliate of the Company (the "Acquisition Offer") to acquire the
Company, (ii) the directors designated by the Initiating Stockholders on the
Company's Board of Directors shall have voted to approve the Acquisition Offer
and (iii) the Board of Directors shall have failed to approve the Acquisition
Offer, then the Initiating Stockholders and the Paribas Stockholders shall be
entitled to sell to the other Principal Stockholders (the "Non-Initiating
Stockholders"), and the Non-Initiating Stockholders shall be obligated to
purchase, all of the Initiating Stockholder's and the Paribas Stockholder's
Securities at the Offer Price Per Security by delivering written notice
requiring such purchase (the "Put Notice") to the Non-Initiating Stockholders
and the Company within 60 days from the date on which the Company's Board of
Directors declined to approve such Acquisition Offer. Each Non-Initiating
Stockholder shall be irrevocably obligated to purchase, at the Offer Price Per
Security, at a closing to be held pursuant to Section 3.2(b) hereof, a pro rata
portion (based on the respective numbers of shares of Common Stock then held by
such Non-Initiating Stockholder (on a fully-diluted basis)) of the Securities
being offered by the Initiating Stockholder and the Paribas Stockholders.
(b) The closing of any sale pursuant to this Section 3.2 shall take
place at the offices of the Company at 10:00 a.m. local time on a date not more
than 60 days after the Put Notice is received by the Company, or at such other
time and place as the Non-Initiating Stockholders, the Initiating Stockholders
and the Paribas Stockholders may agree upon. At the closing, the Initiating
Stockholders and the Paribas Stockholders will deliver to the Non-Initiating
Stockholders a certificate or certificates or instruments evidencing all of the
Securities held by such Initiating Stockholders and the Paribas Stockholders
(properly endorsed or accompanied by stock powers or assignments with
signature(s)
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guaranteed or similar appropriate documentation of authority to transfer and
free and clear of any mortgage, lien, pledge, charge, security interest,
encumbrance, or other adverse claim thereto), and the Non-Initiating
Stockholders shall pay to the Initiating Stockholders and the Paribas
Stockholders the purchase price therefor in cash or in immediately available
funds.
3.3. Consent of Stockholders. If at any time the Company's Board of
Directors approves the sale of the Company to any Person who is not an Affiliate
of the Company (whether by merger, consolidation, sale of all or substantially
all of the Company's assets or sale of all of the outstanding shares of Common
Stock and Preferred Stock in which all of the Stockholders are entitled to
participate) (an "Approved Sale"), each Stockholder hereby waives, to the extent
permitted by applicable law, all rights to object to or dissent from such
Approved Sale and hereby agrees that it will consent to and raise no objections
against such Approved Sale. Each Stockholder agrees to vote such Stockholder's
Securities entitled to vote to approve the terms of any such Approved Sale and
any matters ancillary thereto as may be necessary in the judgment of the
Company's Board of Directors to effect such Approved Sale. If the Approved Sale
is structured as a sale of Securities, each Stockholder agrees to sell all of
such Stockholder's Securities on the terms and conditions approved by the
Company's Board of Directors. Notwithstanding the foregoing the Paribas
Stockholders shall not be required to make any representations and warranties to
the purchaser in any Approved Sale other than with respect to such Paribas
Stockholder's title to its Securities, provided that the Paribas Stockholders
shall nonetheless be liable for any indemnification obligations in connection
with any Approved Sale on the same terms as the other Stockholders, but only to
the extent of the proceeds received by the Paribas Stockholders in such Approved
Sale.
3.4. Received Consideration. The obligations of each Stockholder with
respect to any Approved Sale are subject to the satisfaction of the conditions
that (a) upon the consummation of the Approved Sale, each Stockholder will
receive the same form and amount of consideration per share of outstanding
Common Stock and Preferred Stock and per Note as is given to each other
Stockholder, or if any holders are given an option as to the form and amount of
consideration to be received, all holders will be given the same option, and no
Stockholder will be entitled to receive any economic benefits which are not made
on a pro rata basis to all of the other Stockholders; provided, that (i) no
Stockholder shall be required to accept any consideration which it is prohibited
by law from receiving and (b) in such event, such Stockholder shall be entitled
to receive cash or the economic equivalent of such consideration in other
property, and (ii) receipt by the holders of Securities of a written fairness
opinion from an investment
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banking firm of national prominence which is not an Affiliate of the Company or
of any Stockholder and which is selected by the Company's Board of Directors
that the consideration per share of Common Stock and Preferred Stock and per
Note to be received by each holder of Securities is not less than the fair value
thereof. In determining the amount of consideration per share payable to any
Stockholder in connection with an Approved Sale, all consulting, noncompetition,
investment banking or other fees payable to such Stockholder in connection with
such Approved Sale shall be deemed to be part of the consideration payable to
such Stockholder in such Approved Sale (other than any bona fide investment
banking fees paid to the TA Stockholders in connection with any investment
banking or advisory services rendered by them in connection with such Approved
Sale).
3.5. Proxy. Each Stockholder hereby appoints the Company in any
Approved Sale as such Stockholder's true and lawful proxy and attorney, with
full power of substitution, to vote all of such Stockholder's Securities
entitled to vote to effectuate the agreements set forth in this Section 3 in the
event of any breach by such Stockholder of its obligations under this Section 3.
The proxies and powers granted by each Stockholder pursuant to this Section 3.5
are coupled with an interest and are given to secure the performance of such
Stockholder's duties under this Section 3. Such proxies are irrevocable for so
long as this Section 3 remains in effect and will survive the death,
incompetency or disability of any Stockholder who is an individual and the
merger, liquidation or dissolution of any Stockholder that is a corporation,
partnership or other entity.
ss.4. BOARD OF DIRECTORS.
4.1. Boards of Directors; Voting Agreements. (a) Subject to adjustment
as provided below, in any and all elections of directors of the Company and its
Subsidiaries (whether at a meeting or by written consent in lieu of a meeting),
each Stockholder shall vote, or cause to be voted, or cause such Stockholder's
designees as directors to vote, all shares of Class A Common Stock owned by such
Stockholder or over which such Stockholder has voting control so as to fix the
number of directors of each of the Company and its Subsidiaries at five, and to
nominate and elect such five directors of the Company and its Subsidiaries as
follows:
(i) Two individuals designated by the holders of a majority of
the outstanding shares of Common Stock included in BBV Securities;
(ii) Two individuals designated by the holders of a majority
of the outstanding shares of Class A Common Stock included in Harvest
Securities; and
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(iii) Xxxxx Xxxxxxx, so long as he continues to be employed by
the Company as President and Chief Executive Officer, and thereafter,
his successor as President and Chief Executive Officer of the Company.
(b) If any vacancy shall occur in the Board of Directors of the Company
or any of its Subsidiaries as a result of death, disability, resignation or any
other termination of a director, the replacement for such vacating director
shall be designated by the Person who, pursuant to ss.4.1(a) above, originally
designated such vacating director. Each Person entitled to designate a director
pursuant to this ss.4 shall also be entitled to designate the removal of such
director with or without cause and a replacement for any director so removed.
Each Stockholder hereby agrees to vote or cause to be voted or cause such
Stockholder's designees as directors to vote all shares of Class A Common Stock
owned by such Stockholder so as to comply with this ss.4.1(b).
4.2. Consent to Certain Actions. The Company hereby agrees that it will
not take, and will not permit any of its Subsidiaries to take any of the actions
set forth in Schedule 2 attached hereto and incorporated herein by reference,
and each of the Stockholders hereby agrees that it shall not vote for or cause
any of the directors designated by it to vote for or approve any of the actions
set forth on Schedule 2, unless such action has been approved by (i) the
affirmative vote of the directors designated by the BBV Stockholders pursuant to
Section 4.1(a)(i) hereof at any time while any director so designated is serving
on the Company's Board of Directors or such BBV Stockholders holding a majority
of the then outstanding shares of Common Stock included in BBV Securities at any
time when such Persons have not designated any directors pursuant to Section
4.1(a)(i) hereof and (ii) the affirmative vote of the directors designated by
the Harvest Stockholders pursuant to Section 4.1(a)(ii) hereof at any time while
any director so designated is serving on the Company's Board of Directors or
such Harvest Stockholders holding a majority of the then outstanding shares of
Class A Common Stock included in Harvest Securities at any time when such
Persons have not designated any directors pursuant to Section 4.1(a)(ii) hereof.
4.3. PROXY. EACH STOCKHOLDER HEREBY GRANTS TO THE COMPANY AN
IRREVOCABLE PROXY, COUPLED WITH AN INTEREST, TO VOTE ALL OF SUCH STOCKHOLDER'S
VOTING SECURITIES TO THE EXTENT NECESSARY TO CARRY OUT THE PROVISIONS OF THIS
SECTION 4 IN THE EVENT OF ANY BREACH BY SUCH STOCKHOLDER OF HIS, HER OR ITS
OBLIGATIONS UNDER THE VOTING AGREEMENT CONTAINED HEREIN.
4.4. Action by Stockholders. Each Stockholder further agrees that such
Stockholder will not vote any voting securities owned by such
-16-
Stockholder or over which such Stockholder has voting control, or take any
action by written consent, or take any other action as a stockholder of the
Company, to circumvent the voting arrangements required by this ss.4. Without
limiting the generality of the foregoing, each Stockholder agrees not to (a)
vote any voting securities owned by such Stockholder or over which such
Stockholder has voting control, or take any other action as a stockholder of the
Company, to approve any corporate action or transaction by the Company not
previously approved by the Board of Directors of the Company elected in
accordance with this ss.4 or (b) commence or maintain any shareholder's
derivative suit challenging any action or transaction approved by the Company's
Board of Directors.
ss.5. LIMITED FIRST REFUSAL RIGHTS.
5.1. Anti-Dilution Provision. Except for the issuance of Common Stock
(or securities convertible into or containing options or rights to acquire
shares of Common Stock) (a) pursuant to a Public Sale, (b) pursuant to the
Company's 1995 Stock Option Plan, (c) the proceeds of which are used solely to
finance any acquisition of all or substantially all of the assets or stock of
any Person which is approved in accordance with Section 4.2 hereof, (d) upon
conversion of Common Stock of another class, or (e) pursuant to the exercise of
the Paribas Warrants, if the Company authorizes the issuance and sale of any
shares of capital stock or any securities convertible into or containing options
or rights to acquire any shares of capital stock (other than as a dividend on
the outstanding Common Stock), the Company will first offer to sell to each
Major Holder a portion of such securities equal to the percentage determined by
dividing (i) the sum of (A) the number of shares of Common Stock held by such
Major Holder plus (B) the number of shares of Common Stock then purchasable by
such Major Holder upon the exercise of all outstanding options and the
conversion of all outstanding convertible securities held by such Major Holder,
by (ii) the sum of (A) the number of shares of Common Stock then outstanding
plus (B) the number of shares of Common Stock then purchasable upon exercise of
all outstanding options and the conversion of all outstanding convertible
securities. Each Major Holder will be entitled to purchase all or part of such
stock or securities at the same price and on the same terms as such stock or
securities are to be offered to any other Persons.
5.2. Major Holders' Exercise of Right. Each Major Holder must exercise
such Major Holder's purchase rights hereunder within 30 days after receipt of
written notice from the Company describing in reasonable detail the stock or
securities being offered, the purchase price thereof, the payment terms and such
Major Holder's percentage allotment. If all of the stock or securities offered
to the Major Holders are not fully subscribed by the Major
-17-
Holders, the stock or securities which are not so subscribed for will be
reoffered to the Major Holders purchasing their full allotment upon the terms
set forth in this ss.5, except that such Major Holders must exercise their
purchase rights within 10 days after receipt of such reoffer.
5.3. Company's Exercise of Right. Upon the expiration of the offering
periods described above, the Company will be free to sell such stock or
securities which the Major Holders have not elected to purchase during the 60
days following such expiration on terms and conditions no more favorable to the
purchasers thereof than those offered to the Major Holders. Any stock or
securities offered or sold by the Company after such 60-day period must be
reoffered to the Major Holders pursuant to the terms of this ss.5.
ss.6. PARIBAS PARTICIPATION RIGHTS. No Principal Stockholder may, at
any time after the completion of a Qualified Public Offering, Transfer to the
Company or any other Person any Common Stock constituting Securities without
complying with the provisions of this Section 6, except (i) pursuant to a Public
Sale or (ii) to an Affiliate of such Principal Stockholder. The Principal
Stockholder will deliver a notice to the Paribas Stockholders at least 15 days
prior to such Transfer. Such notice will disclose in reasonable detail the
number of shares of Common Stock to be transferred, the class or classes of such
Common Stock, the proposed price, terms and conditions of the Transfer and the
identity of the transferee. Each of the Paribas Stockholders may elect to
participate in the contemplated Transfer by delivering written notice to the
Principal Stockholders within 15 days after delivery of the notice from the
Principal Stockholder. Each of the Principal Stockholder and the Paribas
Stockholders will be entitled to sell in the contemplated sale, at the same
price and on the same terms, a number of shares of Common Stock constituting
Securities equal to the product of (i) the fraction, the numerator of which is
the number of shares of Common Stock constituting Securities (on a fully-diluted
basis, treating all classes of Common Stock as a single class) held by such
Person, and the denominator of which is the aggregate number of shares of Common
Stock constituting Securities (on a fully-diluted basis, treating all classes of
Common Stock as a single class) owned by the Principal Stockholder and such
participating Paribas Stockholders, multiplied by (ii) the number of shares of
Common Stock constituting Securities (on a fully-diluted basis, treating all
classes of Common Stock as a single class) to be sold in the contemplated sale.
The transferring Principal Stockholder will use its best efforts to obtain the
agreement of the prospective transferee(s) to the participation of the Paribas
Stockholders in any contemplated sale and will not transfer any of its Common
Stock constituting Securities to the prospective transferee(s) if the
prospective transferee(s) declines to allow the participation of the Paribas
Stockholders on the terms specified herein. In addition, in any sale pursuant to
-18-
this Section 6, each Principal Stockholder and Paribas Stockholder shall receive
the same form and amount of consideration per Security as is given the other
Principal Stockholders and the Paribas Stockholders, or if any such Person is
given an option as to the form and amount of consideration to be received, all
of such Persons will be given the same option, and no Stockholder will be
entitled to receive any economic benefits which are not made available on a pro
rata basis to all of the other Stockholders. In determining the amount of
consideration per share of Common Stock payable to any Stockholder in connection
with any sale pursuant to this Section 6, all consulting, noncompetition,
investment banking or other fees payable to such Stockholder in connection with
such sale shall be deemed to be part of the consideration to be paid to such
Stockholder in connection with such sale (other than any bona fide investment
banking fees paid to the TA Stockholders in connection with any investment
banking or advisory services rendered by them in connection with such sale).
ss.7. ADDITIONAL LEGEND. So long as any Securities are subject to the
provisions hereof, (a) all certificates representing shares of Common Stock and
Preferred Stock constituting Securities will have imprinted on them the
following legend:
The shares represented by this certificate are subject to the terms of
a certain Stockholder Agreement, dated as of January 30, 1995, among
the issuer of this certificate and certain investors. The Stockholder
Agreement contains certain restrictive provisions relating to the
voting and transfer of shares of the stock represented hereby. A copy
of the Stockholder Agreement is on file at the Company's principal
offices. Upon written request to the Company's Secretary, a copy of the
Stockholder Agreement will be provided without charge to appropriately
interested persons.
and (b) all Notes which constitute Securities will bear the following legend:
This Note is subject to the terms of a certain Stockholder Agreement,
dated as of January 30, 1995, among the issuer of this Note and certain
investors. The Stockholder Agreement contains certain restrictive
provisions relating to the transfer of this Note. A copy of the
Stockholder Agreement is on file at the Company's principal offices.
Upon written request to the Company's Secretary, a copy of the
Stockholder Agreement will be provided without charge to appropriately
interested persons.
ss.8. SEVERABILITY. Whenever possible, each provision of this Agreement
will be interpreted in such manner as to be effective and valid under applicable
law, but if any provision of this Agreement is held to be
-19-
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 any other jurisdiction, but this Agreement
will be reformed, construed and enforced in such jurisdiction as if such
invalid, illegal or unenforceable provision had never been contained herein.
ss.9. ENTIRE AGREEMENT. Except as otherwise expressly set forth herein,
this document embodies the complete agreement and understanding among the
parties hereto with respect to the subject matter hereof and thereof and
supersedes and preempts any prior understandings, agreements or representations
by or among the parties, written or oral, which may have related to the subject
matter hereof in any way.
ss.10. SUCCESSORS AND ASSIGNS. This Agreement will bind and inure to
the benefit of and be enforceable by the Company and the Stockholders and their
respective successors and assigns.
ss.11. COUNTERPARTS. This Agreement may be executed in separate
counterparts each of which will be an original and all of which taken together
will constitute one and the same agreement.
ss.12. REMEDIES. The Stockholders will be entitled to enforce their
rights under this Agreement specifically (without posting a bond or other
security), to recover damages by reason of any breach of any provision of this
Agreement and to exercise all other rights existing in their favor. The parties
hereto agree and acknowledge that money damages may not be an adequate remedy
for any breach of the provisions of this Agreement and that any Stockholder may
in its sole discretion apply to any court of law or equity of competent
jurisdiction for specific performance and/or injunctive relief in order to
enforce or prevent any violation of the provisions of this Agreement. In the
event of any dispute involving the terms of this Agreement, the prevailing party
shall be entitled to collect reasonable fees and expenses incurred by the
prevailing party in connection with such dispute from the other parties to such
dispute.
ss.13. NOTICES. Any notice provided for in this Agreement will be in
writing and will be deemed properly delivered if either personally delivered or
sent by overnight courier or mailed certified or registered mail, return receipt
requested, postage prepaid to the recipient at the address listed for such
Stockholder in the stock records of the Company. Any such notice shall be
effective (i) if delivered personally, when received, (ii) if sent by overnight
courier, when receipted for, and (iii) if mailed, 3 days after being mailed as
described above. The Company agrees to make available to each Stockholder upon
request an address list of all Stockholders to ensure correct delivery of all
notices hereunder.
-20-
ss.14. AMENDMENT AND WAIVER. No modification, amendment or waiver of
any provision of this Agreement will be effective against the Company or the
Investor Stockholders unless such modification, amendment or waiver is approved
in writing by the holders of at least 70% of the total number of then
outstanding shares of Common Stock constituting Securities hereunder; provided,
however, that no amendment, modification or waiver of any provision of this
Agreement that materially adversely affects the rights of one particular Party
(as hereinafter defined) to this Agreement (whether or not such amendment,
modification or waiver materially adversely affects such Party in a manner
different from the rights of the other Parties) shall be effective against such
adversely affected Party unless approved in writing by the holders of at least
fifty-one (51%) of the total number of outstanding shares of Common Stock then
held by all members of such Party. As used in this Section 13, "Party" means any
one of the following entities or groups: (i) the Company, (ii) BBV, (iii) the
BBV Stockholders, (iv) the Harvest Stockholders, (v) the Paribas Stockholders,
(vi) the Management Stockholders, (vii) the TA Stockholders and (viii) in the
case of Section 4.1(a), Xxxxx Xxxxxxx. The failure of any party to enforce any
of the provisions of this Agreement will in no way be construed as a waiver of
such provisions and will not affect the right of such party thereafter to
enforce each and every provision of this Agreement in accordance with its terms.
ss.15. EMPLOYMENT. Nothing contained in this Agreement is intended to
create for any Stockholder who is a Manager a right to continued employment with
the Company or employment in the same position or on the same terms as those
currently in effect. Any such right to employment shall be pursuant to a
separate employment agreement between the Company and such Stockholder.
ss.16. TERMINATION. This Agreement (other than Section 6) will
terminate upon the earliest to occur of (i) the completion of any voluntary or
involuntary liquidation or dissolution of the Company, (ii) the completion of a
Qualified Public Offering or (iii) the completion of any Approved Sale.
ss.17. GOVERNING LAW. ALL QUESTIONS CONCERNING THE CONSTRUCTION,
VALIDITY AND INTERPRETATION OF THIS AGREEMENT WILL BE GOVERNED BY THE LAWS OF
THE STATE OF DELAWARE.
ss.18. DESCRIPTIVE HEADINGS. The descriptive headings of this Agreement
are inserted for convenience only and do not constitute a part of this
Agreement.
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IN WITNESS WHEREOF, the parties hereto have executed this Stockholder
Agreement on the day and year first above written.
CDI GROUP, INC.
By: ______________________________
Title: ___________________________
BANCBOSTON VENTURES INC.
By: ______________________________
Title: ___________________________
HARVEST PARTNERS
INTERNATIONAL, LP
By: ______________________________
Title: ___________________________
HARVEST TECHNOLOGY
PARTNERS, LP
By: ______________________________
Title: ___________________________
EUROPEAN DEVELOPMENT
CAPITAL CORPORATION N.V.
By: ______________________________
Title: ___________________________
DEUTSCHE
BETEILIGUNGSGESELLSCHAFT
MBH
-22-
By: ______________________________
Title: ___________________________
BANQUE PARIBAS
By: ______________________________
Title: ___________________________
PARIBAS PRINCIPAL, INC.
By: ______________________________
Title: ___________________________
TA HOLDING, INC.
By: ______________________________
Title: ___________________________
__________________________________
Xxx Xxxxxxxx
__________________________________
Xxxxx Xxxxxxx
-23-
SCHEDULE 1
TO STOCKHOLDER
AGREEMENT
Instrument of Accession
The undersigned, ____________________, in order to become the owner or
holder of [________ shares of [Preferred Stock] [[Class A Voting] [Class B
Non-Voting] Common Stock, $.00001 par value per share] [a Senior Subordinated
Note in the principal amount of $__________] of CDI Group, Inc., a Delaware
corporation, hereby agrees to become a Stockholder party to that certain
Stockholder Agreement, dated as of January 30, 1995 (the "Stockholder
Agreement"), a copy of which is attached hereto. This Instrument of Accession
shall become a part of such Stockholder Agreement.
Executed as of the date set forth below under the laws of the State of
Delaware.
Signature: ___________________________
Address: ___________________________
___________________________
___________________________
Date: ___________________________
Accepted:
CDI GROUP, INC.
By: _______________________________
Date: _____________________________
-24-
SCHEDULE 2
TO STOCKHOLDER
AGREEMENT
I. Consent to Certain Actions
(a) the establishment and modification of the annual budget and
forecasts with respect to operating income, cash flow, and capital expenditures
of the Company and its Subsidiaries;
(b) the establishment of any pension, insurance or benefit plan for any
employee of the Company and its Subsidiaries (including, without limitation,
officers and directors liability insurance);
(c) except as provided in the annual budget approved pursuant to clause
(a) above, (i) the entering into by the Company or any of its Subsidiaries of
any operating lease which requires total payments of more than $100,000 over the
term of such lease, (ii) the making of any capital expenditure in excess of
$20,000 for any single expenditure or project or such expenditures or projects
which individually have a value of less than $20,000 but which aggregate more
than $75,000 in any fiscal year and (iii) the sale or any commitment for the
sale by the Company or any of its Subsidiaries of any assets or property which
individually have a value of more than $25,000 or such assets or property which
individually have a value of less than $25,000 but which aggregate more than
$100,000 in any fiscal year;
(d) the issuance, purchase, redemption or repurchase, or determination
whether to exercise repurchase rights, of any Common Stock or other securities
of the Company and its Subsidiaries including, without limitation, options and
warrants, and the selection of an appraiser in connection with any repurchase
pursuant to the Management Purchase Agreement;
(e) the declaration or payment of any dividends or other distribution in
respect of the capital of the Company and its Subsidiaries;
(f) the making of an initial public offering of the securities of the
Company or its Subsidiaries;
(g) the borrowing of any money by the Company or any of its Subsidiaries
including, without limitation, the establishment of a line of credit at any bank
or other financial institution except for the borrowings contemplated by the
Credit Agreement as in effect on the Closing Date;
-25-
(h) the giving by the Company or any of its Subsidiaries of any
guaranties or indemnities in connection with the debt or other obligations of
any Person, other than endorsements of negotiable instruments in the ordinary
course of business;
(i) the institution or settlement of any lawsuit or other legal
proceeding involving a claim by the Company or any of its Subsidiaries of more
than $100,000;
(j) any action to effect the voluntary, or which would precipitate an
involuntary, dissolution or winding-up of the Company or any of its
Subsidiaries;
(k) the entering into by the Company or any of its Subsidiaries of any
partnership, joint venture or other similar joint business undertaking;
(l) the creation, modification, amendment or repeal of the Charter or
by-laws of the Company or any of its Subsidiaries;
(m) the establishment of any new business or change in the business of
the Company and its Subsidiaries;
(n) the entering into or consummating of any merger or consolidation, or
sale, lease, sublease or other transfer or disposition of any assets of the
Company or any of its Subsidiaries or the voting stock of any Subsidiary of the
Company (other than sales of assets in the ordinary course of business
consistent with past practice or any sales of assets provided in the annual
budget approved pursuant to clause (a) above or permitted pursuant to clause (c)
above);
(o) the acquisition or making by the Company or any of its Subsidiaries
of any Investment (as defined in the Credit Agreement) except for the
Investments permitted pursuant to the Credit Agreement as in effect on the
Closing Date;
(p) (i) the entering into by the Company or any of its Subsidiaries of
any transaction with any Affiliate on terms more favorable to such Affiliate
than would have been obtainable on an arms-length basis in the ordinary course
of business, or (ii) the making of any payment (whether in cash, securities or
other property) to or for the benefit of any Affiliate of the Company or any of
its Subsidiaries in respect of any indebtedness owed by, or other obligation of,
the Company or any of its Subsidiaries to such Affiliate, other than (A)
compensation (other than any bonuses or any increases in base
-26-
salary from the level specified for the Initial Term (as such term is defined in
the Employment Agreements)) payable to each of Xxxxx Xxxxxxx and Xxxx Xxxxxxxx
pursuant to the terms of the Employment Agreements as in effect on the Closing
Date, (B) payments made pursuant to the Management Fee Agreement, (C) the
reasonable compensation and reimbursement for out-of-pocket expenses of any
member of the Board of Directors of the Company or any of its Subsidiaries who
is not an employee, officer or shareholder of the Company or its Subsidiaries,
not to exceed $5,000 per meeting of the Board of Directors, and (D) the
reasonable costs and expenses associated with any rights of board or executive
committee attendance or observation or inspection and lodging expenses related
thereto;
(q) any amendment or modification of, or the granting of any waiver, or
the failure to enforce any of the rights of the Company pursuant to, any of the
Related Agreements;
(r) the appointment and termination of the President, Chief Executive
Officer, Chief Operating Officer or Chief Financial Officer of the Company and
its Subsidiaries, any President of any division of the Company and its
Subsidiaries or any Vice President of the Company and its Subsidiaries (or
Persons holding equivalent positions to any of the foregoing), and the
establishment of any bonus plan or incentive compensation payable to any of such
officers of the Company or its Subsidiaries;
(s) the appointment and retention of auditors and legal counsel for the
Company and its Subsidiaries;
(t) retaining and compensating by the Company or any of its Subsidiaries
any consultant, advertising agency, public relations firm, investment banker or
other advisor or professional whose annual remuneration exceeds $50,000; and
(u) the prepayment of any of the Company's Senior Subordinated Notes
issued pursuant to the Investor Purchase Agreement.
II. Definitions
Capitalized terms defined in the Investor Purchase Agreement and not
otherwise defined herein are used herein with the meanings so defined.
FIRST AMENDMENT TO STOCKHOLDER AGREEMENT
This FIRST AMENDMENT TO STOCKHOLDER AGREEMENT, dated as of October 16,
1997, is made by and among CDI Group, Inc., a corporation organized and existing
under the laws of the State of Delaware (the "Company"), and the stockholders of
the Company set forth on the signature pages hereto (each, a "Stockholder", and
collectively, the "Stockholders").
BACKGROUND
WHEREAS, the Company, the Stockholders and certain other holders of
capital stock of the Company entered into a Stockholder Agreement, dated as of
January 30, 1995 (the "Stockholder Agreement"), in connection with the
acquisition by the Company of Community Distributors, Inc., a corporation
organized and existing under the laws of the State of Delaware ("CDI");
WHEREAS, the Company and CDI entered into a Credit Agreement, dated as
of January 30, 1995, with the various banks named therein and Banque Paribas as
Agent (the "Old Credit Facility");
WHEREAS, CDI intends to issue approximately $80,000,000 in Senior Notes
due 2004, and use the proceeds thereof to (i) repay the amounts outstanding
under the Old Credit Facility, and (ii) pay a dividend of approximately
$45,000,000 to the Company, its sole stockholder;
WHEREAS, in connection with the repayment of the Old Credit Facility,
CDI intends to enter into a new Loan and Security Agreement with PNC Bank,
National Association, which Loan and Security Agreement shall provide for a
revolving line of credit in the maximum principal amount of $20,000,000 (the
"New Credit Facility");
WHEREAS, under the terms of the Stockholder Agreement, the Company
requires the consent of certain of the Stockholders to take certain actions,
including borrowing money other than under the Old Credit Facility; and
WHEREAS, the Stockholders are holders of at least 70% of the total
number of outstanding shares of common stock of the Company constituting
"Securities" under the Stockholder Agreement.
WHEREAS, the Company and the Investors desire to amend the Stockholder
Agreement, primarily to change the reference to the Old Credit Facility to a
reference to the New Credit Facility.
-2-
NOW THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the Company and the Stockholders do
hereby agree as follows:
1. Amendment of Stockholder Agreement.
The Stockholder Agreement is hereby amended as follows:
(a) Section 1 of the Stockholder Agreement is amended by deleting the
definition of "Investor Purchase Agreement" appearing in such Section in its
entirety and replacing it with the following:
"Investor Purchase Agreement. Investor Purchase Agreement
shall mean the Investor Securities Purchase Agreement, dated as of
January 30, 1995, among the Company, BBV and the Initial Harvest
Stockholders, as the same may be amended from time to time."
(b) Section 4.1(a) of the Stockholder Agreement is amended by deleting
the existing Section 4.1(a) in its entirety and inserting the following in
substitution thereof:
"4.1. Boards of Directors; Voting Agreements. (a) Subject to
adjustment as provided below, in any and all elections of directors of
the Company and its Subsidiaries (whether at a meeting or by written
consent in lieu of a meeting), each Stockholder shall vote, or cause to
be voted, or cause such Stockholder's designees as directors to vote,
all shares of Class A Common Stock owned by such Stockholder or over
which such Stockholder has voting control so as to fix the number of
directors of each of the Company and its Subsidiaries at five, and to
nominate and elect up to five directors of the Company and its
Subsidiaries to comprise such boards of directors as follows:
(i) Up to two individuals designated by the holders of a
majority of the outstanding shares of Common Stock included in the BBV
Securities;
(ii) Up to two individuals designated by the holders of a
majority of the outstanding shares of Class A Common Stock included in
the Harvest Securities; and
(iii) Xxxxx Xxxxxxx, so long as he continues to be employed by
the Company as President and Chief Executive Officer, and thereafter,
his successor as President and Chief Executive Officer of the Company."
-3-
(c) Schedule 2 to the Stockholder Agreement is amended by deleting the
existing paragraph I(g) of such Schedule 2 in its entirety and inserting the
following in substitution thereof:
"(g) the borrowing of any money by the Company or any of its
Subsidiaries including, without limitation, the establishment of a line
of credit at any bank or other financial institution except for the
borrowings contemplated by the Credit Agreement as in effect on October
16, 1997."
2. No Other Amendment.
Except as specifically provided herein, the Stockholder Agreement shall
remain in full force and effect in the form in which it existed on the date
hereof prior to giving effect to the terms of this First Amendment to
Stockholder Agreement and the Company and the Stockholders ratify and reaffirm
the Stockholder Agreement in its entirety, as modified hereby.
[signature pages follow]
-4-
IN WITNESS WHEREOF, the parties hereto have cause this First Amendment
to Stockholder Agreement to be duly executed as an instrument under seal as of
the date first above written.
COMPANY:
CDI GROUP, INC.
By: _____________________________________
Title: ________________________________
STOCKHOLDERS:
BANCBOSTON VENTURES INC.
By: _____________________________________
Title: ________________________________
HARVEST PARTNERS
INTERNATIONAL, LP
By: _____________________________________
Title: ________________________________
HARVEST TECHNOLOGY PARTNERS, LP
By: _____________________________________
Title: ________________________________
EUROPEAN DEVELOPMENT CAPITAL
CORPORATION N.V.
By: _____________________________________
Title: ________________________________
-5-
DEUTSCHE
BETEILIGUNGSGESELLSCHAFT MBH &
CO. FONDS I KG
By: _____________________________________
Title: ________________________________
DBG AUSLANDS-HOLDING GMBH
By: _____________________________________
Title: ________________________________
BANQUE PARIBAS
By: _____________________________________
Title: ________________________________
PARIBAS PRINCIPAL, INC.
By: _____________________________________
Title: ________________________________
TA HOLDING, INC.
By: _____________________________________
Title: ________________________________
_________________________________________
Xxx Xxxxxxxx
_________________________________________
Xxxxx Xxxxxxx
