EXHIBIT 10.5
EXHIBIT TO AMENDED EMPLOYMENT AGREEMENT
WITH XXXXXXX XXXXXXXXX
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STOCKHOLDER AGREEMENT
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STOCKHOLDER AGREEMENT dated as of November 30, 1999 (this "Agreement"),
among HOUSEHOLD INTERNATIONAL, INC., a Delaware corporation ("Household") and
Xxxxxxx Xxxxxxxxx ("Stockholder").
WHEREAS, Stockholder desires that RENAISSANCE HOLDINGS, INC., an Oregon
corporation ("RHI"), Household and RENAISSANCE CREDIT SERVICES, INC., a Delaware
corporation and a wholly-owned subsidiary of Household ("Sub"), enter into an
Agreement and Plan of Merger dated as of the date hereof in the form of Exhibit
A hereto (as the same may be amended or supplemented, the "Merger Agreement"),
pursuant to which it is intended that RHI merge with and into the Sub (the
"Merger");
WHEREAS, Stockholder has entered into an Employment Agreement with RHI
effective as of September 1, 1999 and has agreed to amend the Employment
Agreement (as so amended, the "Amended Employment Agreement") in connection with
the Merger as of the Effective Time;
WHEREAS, Stockholder has agreed, in connection with the Amended Employment
Agreement, to enter into this Agreement;
WHEREAS, as of the date hereof, Stockholder is beneficial owner of, and has
the right to vote and dispose of the number of shares of RHI common stock, par
value $.01 per share ("RHI Common Stock") which is set forth in Schedule A
hereto; and
WHEREAS, Stockholder is executing this Agreement as an inducement to
Household and Sub to enter into and execute the Merger Agreement;
NOW, THEREFORE, in consideration of the execution and delivery by Household
and Sub of the Merger Agreement and the covenants, conditions and agreements
contained herein and therein, the parties agree as follows:
Section 1. General Representations, Warranties and Covenants. Stockholder
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represents, warrants and covenants to Household, as of the date of this
Agreement and the Effective Time, as follows:
(a) Stockholder is the record and beneficial owner of the number of
shares of RHI Common Stock set forth in Schedule A hereto, as such Schedule
is amended or modified pursuant to Section 5 hereof (the "Stockholder's
Shares" or such "Shares"). Except for the Shares, Stockholder is not
the record or beneficial owner of any other shares of RHI Common Stock and,
except as set forth in Schedule B hereto, does not
Stockholders Agreement of Xxxxxxx Xxxxxxxxx Page 1
own, or have the right to acquire, any option, warrant or other right to
subscribe for, purchase or otherwise acquire any shares of RHI Common Stock
or any security convertible into shares of RHI Common Stock ("Options").
(b) This Agreement has been duly authorized, executed and delivered by
the Stockholder and, assuming due execution and delivery of this Agreement
by Household, shall constitute the legal, valid and binding obligation of
the Stockholder, enforceable against the Stockholder in accordance with its
terms, except as enforceability may be limited by bankruptcy and other
similar laws and general principles of equity. Neither the execution and
delivery of this Agreement nor the consummation by the Stockholder of the
transactions contemplated hereby will result in a violation of, or a
default under, or conflict with, any contract, trust, commitment,
agreement, understanding, arrangement or restriction of any kind to which
the Stockholder is a party or bound or to which the Stockholder's Shares or
any Options are subject. No trust of which the Stockholder is a trustee
requires the consent of any beneficiary to the execution and delivery of
this Agreement or to the consummation of the transactions contemplated
hereby. If the Stockholder is married and the Stockholder's Shares or
Options constitute community property, this Agreement has been duly
authorized, executed and delivered by, and constitutes a valid and binding
agreement of, the Stockholder's spouse, enforceable against such person in
accordance with its terms, except as enforceability may be limited by
bankruptcy and other similar laws and general principles of equity.
Execution and delivery of the Agreement by the Stockholder and performance
of the transactions contemplated hereby will not violate, or require any
consent, approval or notice under any provision of any judgment, order,
decree, statute, law, rule or regulation applicable to the Stockholder, the
Stockholder's Shares or Options.
(c) The Stockholder's Shares and the certificates representing such
Shares are now and at all times during the term hereof will be held by the
Stockholder, or by a nominee or custodian for the benefit of the
Stockholder, 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.
(d) No broker, investment banker, financial adviser 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 Stockholder.
(e) The Stockholder understands and acknowledges that Household and
Sub are entering into the Merger Agreement in reliance upon the
Stockholder's execution and delivery of this Agreement.
Household represents, warrants and covenants to Stockholder, as of the date of
this Agreement and the Effective Time, as follows:
Stockholders Agreement of Xxxxxxx Xxxxxxxxx Page 2
(aa) This Agreement and the Merger Agreement have been duly and
validly executed and delivered by Household and Sub, as applicable, and
assuming due execution and delivery of this Agreement by Stockholder, shall
constitute the legal, valid and binding obligation of Household and Sub, as
applicable, enforceable in accordance with their terms, except as
enforceability may be limited by bankruptcy and other similar laws and
general principles of equity. Neither the execution and delivery of this
Agreement or the Merger Agreement nor the consummation of the Merger or the
transactions contemplated hereby will result in the violation of, or a
default under, or conflict with, any contract, trust, commitment,
agreement, understanding, arrangement or restriction of any kind to which
Household or Sub is a party or bound. Execution and delivery by Household
and Sub of this Agreement and the Merger Agreement and performance of the
transactions contemplated thereby will not violate or require any consent,
approval or notice under any provision of any judgment, order, decree,
statute, law, rule or regulation applicable to Household or Sub, except for
(i) applicable requirements, if any, of the OTS, the OCC, the Exchange Act,
the Securities Act, the Blue Sky Laws and the HSR Act, in each case,
including rules and regulations promulgated thereunder and (ii) the Merger
Filing.
(bb) Household and Sub understand and acknowledge that Stockholder,
is entering into this Agreement in reliance upon the covenant and agreement
of Household and Sub to perform their respective covenants and obligations
under this Agreement and the Merger Agreement in accordance with its terms.
Household and Sub hereby covenant to Stockholder to perform their
respective covenants and obligations under the Merger Agreement in
accordance with its terms.
(cc) A true and correct copy of the Merger Agreement is attached
hereto as Exhibit A.
Section 2. The Merger. Stockholder hereby agrees to (i) vote his Shares
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in favor of the Merger and the Merger Agreement at the RHI Meeting, and any
adjournment or postponement thereof and (ii) deliver his Shares to Household
pursuant to the terms of the Merger Agreement. Further, Stockholder hereby
agrees that he will not exercise any dissenters' rights or rights of appraisal
that he may have with respect to the Merger.
Section 3. Specific Stockholder Covenants. Stockholder agrees with and
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covenants to Household:
(a) Stockholder shall not, except as contemplated by the terms of
this Agreement or the Merger Agreement, (i) transfer (which terms shall
include, without limitation, for the purposes of this Agreement, any sale,
gift, pledge or other disposition), or consent to any transfer of, any or
all of such Stockholder's Shares, Options or any interest therein, (ii)
enter into any contract, option or other agreement of understanding with
respect to any transfer of any or all of such Stockholder's Shares, Options
or any interest therein, (iii) grant any proxy, power-of-attorney or other
authorization in or with respect to such Stockholder's Shares or Options,
(iv) deposit such Stockholder's Shares or
Stockholders Agreement of Xxxxxxx Xxxxxxxxx Page 3
Options into a voting trust or enter into a voting agreement or arrangement
with respect to such Stockholder's Shares or Options or (v) take any other
action that would in any way restrict, limit or interfere with the
performance of his obligations hereunder or the transactions contemplated
hereby.
(b) Stockholder shall not, directly or indirectly, solicit, initiate
or encourage the submission of, any takeover proposal with respect to RHI
other than the Merger.
(c) At any meeting of stockholders of RHI or at any adjournment
thereof or in any other circumstances upon which their vote, consent or
other approval is sought, Stockholder shall vote (or cause to be voted) any
voting shares of RHI Common Stock which he has the power to vote against
(i) any merger agreement or merger, consolidation, combination, tender
offer (including an exchange offer), sale of substantial assets,
reorganization, joint venture, recapitalization, dissolution, liquidation
or winding up of or by RHI or any Affiliate thereof (other than the Merger
as set forth in the Merger Agreement) and (ii) any amendment of RHI's
Articles of Incorporation or By-laws or other proposal or transaction
involving RHI or any of its subsidiaries which amendment or other proposal
or transaction would in any manner impede, frustrate, prevent or nullify,
or result in a breach of any covenant, representation or warranty or any
other obligation or agreement of RHI under or with respect to the Merger
Agreement or any of the other transactions contemplated by the Merger
Agreement (each of the foregoing in clause (i) or (ii) above, a "Competing
Transaction").
Section 4. Certain Events. Stockholder agrees that this Agreement and the
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obligations hereunder shall attach to such Stockholder's Shares and the Options
and shall be binding upon any person or entity to which legal or beneficial
ownership of such Shares or Options shall pass, whether by operation of law or
otherwise, including without limitation Stockholder's heirs, guardians,
administrators or successors. In the event of any stock split, stock dividend,
merger, reorganization, recapitalization or other change in the capital
structure of RHI affecting the RHI Common Stock, or the acquisition of
additional shares of RHI Common Stock or other voting securities of RHI by
Stockholder, the number of Stockholder's Shares listed in Schedule A shall be
adjusted appropriately and this Agreement and the obligations hereunder shall
attach to any additional shares of RHI Common Stock or other voting securities
of RHI issued to or acquired by Stockholder.
Section 5. Restriction on Stock Sales. Except in accordance with the
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provisions of this Section, Stockholder agrees that without the prior written
consent of Household, the Stockholder will not offer for sale, contract to sell,
sell or otherwise dispose of any of the shares of Household Common Stock
received as a portion of the Merger Consideration pursuant to the Merger
Agreement (including the receipt of any such shares through the exercise of RHI
Stock Options after the Effective Time), sell short any such shares of Household
Common Stock, sell any covered call with respect to such shares of Household
Common Stock or purchase a put with respect to such shares of Household Common
Stock; provided, however, that, without the written consent of Household,
Stockholder may sell, contract to sell or otherwise dispose of all shares of
Household Common Stock beneficially owned by Stockholder upon the termination of
Stockholders Agreement of Xxxxxxx Xxxxxxxxx Page 4
Stockholder as an employee of Household or its subsidiaries. Notwithstanding
the foregoing, subject to satisfaction of Household's stock ownership goal
program revised guidelines dated January 1, 1996 (a copy of which has been
provided to Stockholder), Stockholder may sell, contract to sell or otherwise
dispose of (x) up to 50.00% of the shares of Household Common Stock acquired by
Stockholder as part of the Merger Consideration (including such shares acquired
through the exercise of RHI Stock Options after the Effective Time), in whole or
in part, on the Closing Date, (y) up to an additional 25.00% of the shares of
Household Common Stock acquired by Stockholder as part of the Merger
Consideration (including such shares acquired through the exercise of RHI Stock
Options after the Effective Time), in whole or in part, anytime after January 1,
2001, and (2) all of the shares of Household Common Stock acquired by
Stockholder as part of the Merger Consideration (including such shares acquired
through the exercise of RHI Stock Options after the Effective Time), in whole or
in part, any time after January 1, 2002. This Section 5 shall expire and be of
no further effect upon the earlier to occur of (a) January 1, 2002, or (b) the
date on which Stockholder (or the spouse who is employed by RHI on the date
hereof, in the case of married parties jointly owning Household Common Stock) is
no longer an employee of Household or its subsidiaries.
Section 6. Stockholder Capacity. The Stockholder, by executing this
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Agreement, does not make any agreement or understanding herein in his capacity
as a director or officer of RHI. Stockholder signs solely in his capacity as
the record holder and beneficial owner of such Stockholder's Shares and Options
and nothing herein shall limit or affect any actions taken by Stockholder in his
capacity as an officer or director of RHI to the extent specifically permitted
by the Merger Agreement.
Section 7. Affiliate Agreements. Prior to the Effective Time, Stockholder
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hereby agrees to execute and deliver to Household a Rule 145 Affiliate
Agreement, substantially in the form of Exhibit A to the Merger Agreement.
Section 8. Termination. Other than Sections 5 and 9 which shall survive,
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this Agreement, and all rights and obligations of the parties hereunder, shall
terminate as of the Effective Time. In addition, this Agreement, and all rights
and obligations of the parties hereunder, shall terminate concurrent with a
termination of the Merger Agreement for any reason. Any termination shall not
affect any rights or remedies for breach of this Agreement that may have accrued
to a party hereto prior to the date of termination.
Section 9. Miscellaneous.
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(a) Capitalized terms used and not otherwise defined in this
Agreement shall have the respective meanings assigned such terms in the
Merger Agreement.
(b) All notices, requests, claims, demands and other communications
under this Agreement shall be in writing and shall be deemed given if
delivered personally or sent by overnight courier (providing proof of
delivery) to the parties at the following addresses (or at such other
address for a party as shall be specified by like notice): (i) if to
Household, to the address set forth in Section 9.4 of the Merger Agreement;
and (ii) if
Stockholders Agreement of Xxxxxxx Xxxxxxxxx Page 5
to a Stockholder, to the address set forth in Schedule A hereto, or such
other address as may be specified in writing by Stockholder.
(c) The headings contained in this Agreement are for reference
purposes only and shall not affect in any way the meaning or interpretation
of this Agreement.
(d) This Agreement may be executed in two or more counterparts, all of
which shall be considered one and the same agreement and shall become
effective as to Stockholder when one or more counterparts have been signed
by Household and Stockholder and delivered to each of them.
(e) This Agreement (including the documents and instruments referred
to herein) constitutes the entire agreement, and supersedes all prior
agreements and understandings, both written and oral, among the parties
with respect to the subject matter hereof.
(f) This Agreement shall be governed by, and construed in accordance
with, the laws of the State of Oregon, regardless of the laws that might
otherwise govern under applicable principles of conflicts of laws thereof.
(g) Neither this Agreement nor any of the rights, interests or
obligations under this Agreement shall be assigned, in whole or in part, by
operation of law or otherwise, by any of the parties without the prior
written consent of the other parties, except by laws of descent.
(h) If any term, provision, covenant or restriction herein, or the
application thereof to any circumstance, shall, to any extent, be held by a
court of competent jurisdiction to be invalid, void or unenforceable, the
remainder of the terms, provisions, covenants and restrictions herein and
the application thereof to any other circumstances, shall remain in full
force and effect, shall not in any way be affected, impaired or
invalidated, and shall be enforced to the fullest extent permitted by law.
(i) Each party agrees that irreparable damage would occur and that the
non-breaching party would not have any adequate remedy at law in the event
that any of the provisions of this Agreement were not performed in
accordance with their specific terms or were otherwise breached. It is
accordingly agreed that any non-breaching party shall be entitled to an
injunction or injunctions to prevent breaches by any breaching party of
this Agreement and to enforce specifically the terms and provisions of this
Agreement in any court of the United States located in the State of Oregon
or in Oregon state court, this being in addition to any other remedy to
which they are entitled at law or in equity or under the Merger Agreement.
In addition, each of the parties hereto (i) consents to submit such party
to the personal jurisdiction of any Federal court located in the State of
Oregon or any Oregon state court in the event any dispute arises out of
this Agreement or any of the transactions contemplated hereby, other than
the Merger Agreement, (ii) agrees that such party will not attempt to deny
or defeat such personal jurisdiction by motion or
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other request for leave from any such court and (iii) agrees that such
party will not bring any action relating to this Agreement or any of the
transactions contemplated hereby, other than the Merger Agreement, in any
court other than a Federal court sitting in the State of Oregon or a Oregon
state court. It is further agreed that any breaching or defaulting party
hereunder shall pay to the other parties hereto such out of pocket costs
and expenses, including legal and accounting fees, as are reasonably
incurred in pursuit of such parties' remedies hereunder.
(j) No amendment, modification or waiver in respect of this Agreement
shall be effective against any party unless it shall be in writing and
signed by such party. Household agrees not to amend or modify the Merger
Agreement if such amendment or modification changes the form or amount of
the Merger Consideration unless Stockholder shall have consented in writing
to such amendment or modification.
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Stockholders Agreement of Xxxxxxx Xxxxxxxxx Page 7
IN WITNESS WHEREOF, Household and the Stockholder have caused this
Agreement to be duly executed and delivered as of the date first written above.
HOUSEHOLD INTERNATIONAL, INC.
By: ________________________________________
Title: _______________________________________
___________________________________________
STOCKHOLDER
Stockholders Agreement of Xxxxxxx Xxxxxxxxx Page 8
SCHEDULE A
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Name and Address of Stockholder Number of Stockholder Shares
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Xxxxxxx X. Xxxxxxxxx 49,543
c/o Renaissance Holdings, Inc.
0000 X.X. Xxxxxxxxx-Xxxxxxxxx Xxxxxx
Xxxxx 000
Xxxxxxxxx, XX 00000
Stockholders Agreement of Xxxxxxx Xxxxxxxxx Page 9
SCHEDULE B
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Name and Address Grant RHI Common Stock Exercise Price
of Option Holder Date Issuable Upon Exercise for RHI Shares
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Xxxxxxx Xxxxxxxxx 6/1/96 22,271 shares $ 3.3675
c/o Renaissance Holdings, Inc. 10/31/97 22,000 shares $ 2.5100
0000 X.X. Beaverton- 10/1/98 18,000 shares $ 0.0000
Xxxxxxxxx Xxxxxx 8/5/99 40,000 shares $14.0000
Xxxxx 000
Xxxxxxxxx, XX 00000
Stockholders Agreement of Xxxxxxx Xxxxxxxxx Page 10
EXHIBIT LIST
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Exhibit A -- Merger Agreement
Stockholders Agreement of Xxxxxxx Xxxxxxxxx Page 11
