EXHIBIT 10.1.2
USS HOLDINGS, INC.
AMENDMENT NO. 2 TO
STOCKHOLDERS AGREEMENT
Dated as of October 6, 1998
Table of Contents
Section 1. Definitions; Rules of Construction........................................................ 1
Section 2. Board of Directors; Adjustment EBITDA Targets............................................. 12
Section 3. Financial Statements and Other Information, Inspections and Board Meetings................ 15
Section 4. Additional Voting Agreements; Required Sale............................................... 18
Section 5. First Refusal Rights for Securities Issued by the Corporation............................. 21
Section 6. Affiliate Transactions.................................................................... 22
Section 7. Issuance of Additional Securities to DGHA Stockholders and Manager Stockholders........... 22
Section 8. Limitations on Transfers of Stock - General............................................... 23
Section 9. Limitations on Transfers of Restricted Shares............................................. 23
Section 10 Limitations on Transfers prior to Third Anniversary....................................... 23
Section 11 Rights of First Refusal after Third Anniversary........................................... 24
Section 12 Rights of Co-Sale......................................................................... 25
Section 13 Drag-Along Rights......................................................................... 26
Section 14 Options Upon Termination Event............................................................ 28
Section 15 Required Sale............................................................................. 32
Section 16 Regulatory Matters........................................................................ 32
Section 17 Requisite Stockholder Approval............................................................ 34
Section 18 Amendment and Waiver...................................................................... 34
Section 19 Securities Law Compliance; Legends........................................................ 34
Section 20 Duration of Agreement..................................................................... 36
Section 21 Severability.............................................................................. 36
Section 22 Entire Agreement.......................................................................... 37
Section 23 Certain Stockholders...................................................................... 37
Section 24 Successors and Assigns.................................................................... 37
Section 25 Counterparts.............................................................................. 37
Section 26 Remedies.................................................................................. 37
Section 27 Notices................................................................................... 38
Section 28 Governing Law............................................................................. 39
Section 29 Further Assurances........................................................................ 39
Section 30 Jurisdiction; Venue; Process.............................................................. 39
Section 31 Representation and Warranties of the Stockholders......................................... 39
Section 32 Conflicting Agreements.................................................................... 41
Section 33 Mutual Waiver of Jury Trial............................................................... 41
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AMENDMENT NO. 2 dated as of
October 6, 1998 ("Amendment No. 2"),
among USS HOLDINGS, INC., a Delaware
corporation (the "Corporation"), and
the stockholders of the Corporation
(each a "Stockholder" and
collectively the "Stockholders")
listed on the signature pages hereof,
to the Stockholders Agreement (the
"Agreement") dated as of February 9,
1996, as amended, among the
Corporation and the Stockholders.
The parties hereto, being the parties to the Agreement required to
amend the Agreement in accordance with Section 18(a) thereof, hereby amend the
Agreement, which amendment shall become effective upon execution of this
Amendment No. 2 by the Corporation, a Majority of the Institutional Stockholders
and a Majority of the DGHA Stockholders, by deleting all of the text and
replacing it with the following:
SECTION 1. Definitions; Rules of Construction.
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(a) Capitalized terms used in this Agreement have the meanings
ascribed to them below:
"Accounting Period" has the meaning ascribed to it in Section 3(a)(i).
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"Acquisition" means USS Acquisition, Inc., a Delaware corporation, and
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any successors thereto (including U.S. Silica after the Merger).
"Actual EBITDA" shall be calculated at the end of each Accounting
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Period of the Corporation, beginning with the Accounting Period ending December
31, 1997, and shall mean the EBITDA of the Corporation for the twelve-month
period ended on the last day of such Accounting Period.
"Additional Institutional Director" shall have the meaning ascribed to
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it in Section 2(b).
"Additional Retiring Purchase" has the meaning ascribed to it in
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Section 14(a).
"Adjusted Proportionate Percentage" shall mean, with respect to any
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Stockholder, the Proportionate Percentage of such Stockholder, calculated as if
the Retiring Shares were not issued and outstanding at the time of calculation.
"Affiliate" means (i) with respect to any individual, (A) a spouse or
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descendant of such individual and (B) any trust or family partnership whose
primary beneficiary shall be such individual and/or such individual's spouse
and/or any Person related by blood or adoption to such individual or such
individual's spouse, (ii) with respect to any Person which is not an individual,
any other Person that, directly or indirectly through one or more intermediaries
Controls, is Controlled by, or is under common Control with, such Person and/or
one or more Affiliates thereof, and, without limiting the generality of the
---
foregoing, with respect to CMC includes (x)
the ultimate parent corporation of CMC, and all the Affiliates of the
aforementioned ultimate parent and (y) a corporation, a general partnership, a
limited partnership or limited liability corporation, in which all the
beneficial interests of any of the foregoing entities is owned directly or
indirectly by one or more present or former employees or executives of CMC or
their respective Affiliates.
"Approved Sale" has the meaning ascribed to it in Section 13.
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"Board" means the Board of Directors of the Corporation.
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"Bylaws" means the Bylaws of the Corporation as amended from time to
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time.
"Budgeted EBITDA" shall mean, for the twelve-month period ending on
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the last day of each Accounting Period, beginning with the Accounting Period
ending December 31, 1998, the EBITDA set forth opposite such Accounting Period
on Schedule 2.
"Cause" shall mean the commission by a Promoter Stockholder of a
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felony or other crime involving moral turpitude, or the commission by a Promoter
Stockholder of any other act which is a breach of his fiduciary duty of loyalty
to his employer or the repeated failure of a Promoter Stockholder to otherwise
perform his duties to his employer as determined in good faith by such
employer's Board of Directors.
"Certificate" means the Amended and Restated Certificate of
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Incorporation of the Corporation as filed with the Secretary of State of
Delaware on February 9, 1996, as supplemented by all Certificates of Designation
and Certificates of Amendment, copies of which are attached as Schedule 3.
"Class A Common Stock" means the Class A Common Stock, $.01 par value,
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of the Corporation.
"Class B Common Stock" means the Class B Common Stock, $.01 par value,
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of the Corporation.
"Class C Common Stock" means the Class C Common Stock, $.0l par value,
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of the Corporation.
"Class C Restricted Shares" means, collectively, the DGHA Restricted
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Shares and the Manager Restricted Shares.
"CMC" means Chase Manhattan Capital L.P., a Delaware limited
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partnership.
"Code" means the Internal Revenue Code of 1986, as amended.
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"Common Stock" means the Class A Common Stock, the Class B Common
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Stock and the Class C Common Stock.
"Common Equivalents" means, at any point in time, (i) as to any
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Stockholder, the number of shares of Common Stock held by such Stockholder at
such time, plus the number of
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shares of Common Stock which are issuable (at such time or thereafter) upon the
exercise or conversion of any option, warrant or convertible security held at
such time by such Stockholder and (ii) as to all Stockholders, collectively, the
aggregate number of shares of Common Stock outstanding at such time plus the
aggregate number of shares of Common Stock issuable (at such time or thereafter)
upon the exercise or conversion of all outstanding options, warrants and
convertible securities.
"Company" means, collectively, the Corporation and its Subsidiaries
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and, individually, the Corporation and each Subsidiary of the Corporation.
"Compensation Committee" shall mean the Compensation Committee of the
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Board, as constituted from time to time in accordance with Section 2(c).
"Competitor" means any Person who directly or indirectly, owns,
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manages, operates, joins, controls or participates in the ownership, management,
operation or control of, or is connected as a director, officer, employee,
partner, consultant or otherwise with, any profit or non-profit business or
organization in any part of the United States or any other jurisdiction in which
the Company sells products or provides services, which, directly or indirectly,
Competes (as hereinafter defined) with the Company. A profit or non-profit
business or organization shall be deemed to "Compete" with the Company if such
business or organization (i) competes with the business of the Company as it is
conducted as of the date hereof or at any time while this Agreement is in
effect, or (ii) engages in the development, production or sale of products, or
the rendering of services, which are the same as, similar to or competitive
with, the products or services being developed, provided, sold or rendered by
the Company as of the date hereof or at any time while this Agreement is in
effect.
"Control" means the possession, directly or indirectly, of the power,
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by stock ownership, contract right, proxy or otherwise, to direct the management
and policies of a Person.
"Corporation" has the meaning ascribed to it in the Preamble.
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"Credit Agreement" means the Credit Agreement dated as of July 21,
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1998, as amended from time to time, among Acquisition and the lenders named
therein.
"Credit Event" means (i) the existence of an event of default under
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any Debt Document, or (ii) the existence of a default, which is not waived or
cured within any applicable grace period provided for therein, under any other
document or agreement to which any Company is a party or an obligor, which
evidences indebtedness of any Company individually or in the aggregate of more
than $1,000,000.
"Debt Documents" shall mean the Credit Agreement, the documents
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attached as exhibits thereto and any other loan agreement pursuant to which the
debt under such agreements is refinanced in whole or in part.
"Deferral Date" has the meaning ascribed to it in Section 14(f).
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"Deferral Election" has the meaning ascribed to it in Section 14(f).
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"DGHA" shall mean D. Xxxxxx Xxxxxx & Associates, Inc.
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"DGHA Fee Letter" means the letter agreement dated the Original
---------------
Agreement Date among the Corporation, certain Subsidiaries thereof and DGHA, as
amended from time to time.
"DGHA Repurchase Agreement" means the DGHA Repurchase Agreement dated
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the date hereof, among the Corporation and the DGHA Stockholders named therein.
"DGHA Restricted Shares" means the 216,263 (as adjusted to reflect any
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stock splits, stock dividends, reverse stock splits or reclassifications of the
Class C Common Stock) shares of Class C Common Stock issued or issuable to the
DGHA Stockholders party to the DGHA Repurchase Agreement (and any Securities
issued in respect thereof), which shares are subject to repurchase by the
Corporation upon an IRR Event pursuant to the DGHA Repurchase Agreement, for so
long as such shares of Class C Common Stock are subject to the DGHA Repurchase
Agreement.
"DGHA Stockholders" shall mean any Person listed on the Schedule of
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DGHA Stockholders attached hereto as Schedule 4 and any other employee of DGHA
or an Affiliate of DGHA who is designated as such by the Chairman of DGHA.
"EBITDA" has the meaning, for any period, ascribed to such term in the
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Credit Agreement.
"EBITDA Event" shall mean and occur if, at the end of any Accounting
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Period commencing with the twelve-month period ending December 31, 1997, the
Actual EBITDA for the twelve-month period ending on the last day of such
Accounting Period is less than 75% of the Budgeted EBITDA for the twelve-month
period ending on the last day of the corresponding Accounting Period.
"Eligible Stockholders" has the meaning ascribed to it in Section
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14(a).
"ERISA" means the Employee Retirement Income Security Act of 1974, as
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amended from time to time, and the regulations promulgated and rulings issued
thereunder.
"ERISA Affiliate" means any Person that for purposes of Title IV of
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ERISA is a member of the controlled group of any Obligor, or under common
control with any Obligor, within the meaning of Section 414 of the Code.
"ERISA Event" means (a) (i) the occurrence of a reportable event,
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within the meaning of Section 4043 of ERISA, with respect to any Plan unless the
30-day notice requirement with respect to such event (or the penalty for failure
to provide such notice) has been waived by the PBGC; or (ii) the requirements of
subsection (1) of Section 4043(b) of ERISA (without regard to subsection (2) of
such Section) are met with a contributing sponsor, as defined in Section
4001(a)(13) of ERISA, of a Plan, and an event described in paragraph (9), (10),
(11), (12) or (13) of Section 4043(c) of ERISA is reasonably expected to occur
with respect to such Plan within the following 30 days; (b) the application for
a minimum funding waiver with respect to a Plan; (c) the provision by the
administrator of any Plan of a notice of intent to
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terminate such Plan, pursuant to Section 4041(a)(2) of ERISA (including any such
notice with respect to a plan amendment referred to in Section 4041(e) of
ERISA); (d) the cessation of operations at a facility of any Obligor or any
ERISA Affiliate in the circumstances described in Section 4062(e) of ERISA; (e)
the withdrawal by any Obligor or any ERISA Affiliate from a Multiple Employer
Plan during a plan year for which it was a substantial employer, as defined in
Section 4001(a)(2) of ERISA; (f) the conditions for imposition of a lien under
Section 302(f) of ERISA shall have been met with respect to any Plan; (g) the
adoption of an amendment to a Plan requiring the provision of security to such
Plan, pursuant to Section 307 of ERISA; or (h) the institution by the PBGC of
proceedings to terminate a Plan pursuant to Section 4042 of ERISA, or the
occurrence of any event or condition described in Section 4042 of ERISA that
could reasonably be expected to constitute grounds for the termination of, or
the appointment of a trustee to administer, such Plan.
"Excess Attributable to the First Priority Additional Retiring
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Purchases" shall mean the lesser of (x) the number of Remaining Retiring Shares
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to be purchased in the aggregate by the First Priority Eligible Stockholders
pursuant to their Additional Retiring Purchases and (y) the excess Remaining
Retiring Shares remaining after the Second Retirement Reduction.
"Excess Attributable to the Second Priority Additional Retiring
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Purchases" shall mean the lesser of (x) the number of Remaining Retiring Shares
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to be purchased in the aggregate by the Second Priority Eligible Stockholders
pursuant to their Additional Retiring Purchases and (y) the excess Remaining
Retiring Shares remaining prior to the First Retirement Reduction.
"Exchange Act" means the Securities Exchange Act of 1934, as amended,
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or any similar federal law then in force.
"Exclusive Period" has the meaning ascribed to it in Section 15.
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"Exempt Issuance" shall mean (i) the issuance of shares of Class A
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Common Stock or Class B Common Stock upon the conversion of shares of Series B
Preferred Stock and the issuance of shares of Class A Common Stock upon the
conversion of shares of Class B Common Stock, (ii) the issuance of Securities to
a DGHA Stockholder pursuant to Section 3 of the DGHA Repurchase Agreement and
Section 7(b), (iii) the issuance of Securities to a Manager Stockholder pursuant
to Section 3 of the Manager Repurchase Agreement and Section 7(a), (iv) the
issuance of the Warrants pursuant to the Warrant Issuance Agreement and the
issuance of Securities pursuant to the exercise of the Warrants, (v) the
issuance of Securities, or any securities convertible into or exercisable for
Securities, pursuant to a Public Offering and (vi) the issuance of Securities to
a DGHA Stockholder or a Manager Stockholder after repurchase by the Corporation
pursuant to the DGHA Repurchase Agreement, the Manager Repurchase Agreement or
pursuant to Section 14, of an equivalent or greater number of Securities from
one or more DGHA Stockholders, Manager Stockholders or Non-Affiliated
Stockholders.
"Fair Value" has the meaning ascribed to it in Section 15(a).
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"First Priority Eligible Stockholders" shall mean (i) with respect to
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any Transfer to be made by a DGHA Stockholder, the other DGHA Stockholders, (ii)
with respect to any Transfer to be made by a Manager Stockholder, the other
Manager Stockholders and (iii) with
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respect to any Transfer to be made by a Non-Affiliated Stockholder, the other
Non-Affiliated Stockholders.
"First Refusal Amount" has the meaning ascribed to it in Section 5(a).
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"First Refusal Securities" has the meaning ascribed to it in Section
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5(a).
"GAAP" means United States generally accepted accounting principles,
----
consistently applied.
"Individual Investor Put Shares" has the meaning ascribed to it in
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Section 14(c).
"Initial Institutional Director" shall have the meaning ascribed to it
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in Section 2(a)(iii).
"Initial Public Offering" means the initial Public Offering of equity
-----------------------
securities of the Corporation.
"Initial Retiring Purchase" has the meaning ascribed to it in Section
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14(a).
"Institutional Directors" has the meaning ascribed to it in Section
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2(b).
"Institutional Securities" means all Securities owned by the
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Institutional Stockholders.
"Institutional Stockholders" means any Person listed on the Schedule
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of Institutional Stockholders attached hereto as Schedule 6 and any successor
to, or Permitted Transferee (excluding any transferee who purchases
Institutional Securities pursuant to Section 6) of, any such Person who or which
agrees in writing to be treated as an Institutional Stockholder hereunder and to
be bound by the terms and comply with all applicable provisions hereof.
"IRR Event" means the occurrence of any of the following:
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(i) the sale of all or substantially all of the assets of the
Corporation and its Subsidiaries (in each case after assumption of all
the liabilities of the Corporation or the Subsidiary), on a
consolidated basis;
(ii) the sale of all or substantially all of the Securities;
(iii) a merger of the Corporation or any Subsidiary, provided
that the merger comprises all or substantially all of the assets of
the Corporation and its Subsidiaries, with another Person if the
stockholders of the Corporation immediately prior to such merger do
not own more than 80% of the corporation surviving such merger;
(iv) the consummation of a Qualified Public Offering; or
(v) a sale made pursuant to Section 15.
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"Majority of the Institutional Stockholders" means those Institutional
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Stockholders who at the time in question hold a majority of the Common
Equivalents then held by all Institutional Stockholders.
"Majority of the DGHA Stockholders" means those DGHA Stockholders who
---------------------------------
at the time in question hold a majority of the Common Equivalents then held by
all DGHA Stockholders.
"Management Services Agreement" means the Amended and Restated
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Management Services Agreement dated as of the date hereof among the Corporation,
certain subsidiaries thereof and DGHA, as amended or modified from time to time.
"Manager Repurchase Agreement" means the Manager Repurchase
----------------------------
Agreements, a form of which is attached hereto as Schedule 7, to be entered into
between the Corporation and each Manager Stockholder who purchases Manager
Restricted Shares, respectively.
"Manager Restricted Shares" means the 216,263 (as adjusted to reflect
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any stock splits, stock dividends, reverse stock splits or reclassifications of
the Class C Common Stock) shares of Class C Common Stock issued or issuable to
the Manager Stockholders party to the Manager Repurchase Agreement (and any
Securities issued in respect thereof), which shares are subject to repurchase by
the Corporation upon an IRR Event pursuant to the Manager Repurchase Agreement,
for so long as such shares of Class C Common Stock are subject to the Manager
Repurchase Agreement.
"Manager Stockholder" shall mean any Person listed on the Schedule of
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Manager Stockholders attached hereto as Schedule 8 and any Stockholder who
purchases Securities who is a full-time employee of the Corporation or of any
Subsidiary and is designated as such by the Board, but specifically excluding
the DGHA Stockholders.
"Merger" means the consummation of the merger between Acquisition and
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U.S. Silica, with U.S. Silica as the surviving corporation.
"Multiple Employer Plan" means a single employer plan, as defined in
----------------------
Section 4001(a)(15) of ERISA, that (a) is maintained for employees of any
Obligor or any ERISA Affiliate and at least one Person other than the Obligors
and the ERISA Affiliates or (b) was so maintained and in respect of which any
Obligor or any ERISA Affiliate could have liability under Section 4064 or 4069
of ERISA in the event such plan has been or were to be terminated.
"Non-Affiliated Stockholder" shall mean any Person listed on the
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Schedule of Non-Affiliated Stockholders attached hereto as Schedule 5.
"Notice Date" has the meaning ascribed to it in Section 14(b).
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"Notice of Offer" has the meaning ascribed to it in Section 11(a).
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"Obligor" means Acquisition and U.S. Silica.
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"Offer" has the meaning ascribed to it in Section 11(a).
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"Offeree" has the meaning ascribed to it in Section 11(a).
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"Offeror" shall have the meaning ascribed to it in Section 11(a).
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"Officer's Report" has the meaning ascribed to it in Section 3(a)(ii).
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"Original Agreement Date" means February 9, 1996.
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"Other Stockholders" has the meaning ascribed to it in Section 12(a).
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"PBGC" means the Pension Benefit Guaranty Corporation.
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"Permitted Transferees" has the meaning ascribed to such term in
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Section 8(d).
"Person" shall be construed broadly and shall include an individual, a
------
partnership, a corporation, an association, a joint stock company, a limited
liability company, a trust, a joint venture, an unincorporated organization and
a governmental entity or any department, agency or political subdivision
thereof.
"Plan" means a Single Employer Plan or a Multiple Employer Plan.
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"Preferred Stock" means (i) the Series A Preferred Stock, the Series B
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Preferred Stock and the Seller Preferred Stock and (ii) any shares of any series
of Preferred Stock of the Corporation issued to the Stockholders on or after the
Original Agreement Date.
"Primary Retirement Notice" has the meaning ascribed to it in Section
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14(a).
"Proportionate Percentage" means, with respect to a Stockholder, a
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fraction (expressed as a percentage) the numerator of which is the number of
Common Equivalents held by such Stockholder and the denominator of which is (i)
in a situation where the Proportionate Percentage is being calculated with
respect to all Stockholders, the total number of Common Equivalents outstanding
at the time in question and (ii) in a situation where the Proportionate
Percentage is being calculated with respect to a group of Stockholders, the
total number of Common Equivalents held by the members of such group.
"Public Offering" means the closing of a public offering of Common
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Stock pursuant to a registration statement declared effective under the
Securities Act, except that a Public Offering shall not include an offering made
in connection with an employee benefit plan.
"Public Sale" means any sale, occurring simultaneously with or after a
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Public Offering, of Securities to the public pursuant to an offering registered
under the Securities Act or to the public through a broker, dealer or market
maker pursuant to the provisions of Rule 144.
"Qualified Public Offering" means the sale by the Corporation and/or
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one or more stockholders of the Corporation in an underwritten Public Offering
registered under the Securities Act of Common Stock which results in aggregate
net cash proceeds (net of underwriters' discounts and commissions and estimated
offering expenses) to the Corporation and/or any selling stockholders of not
less than $30 million.
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"Registration Rights Agreement" means the Registration Rights
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Agreement dated as of February 9, 1996, as amended by Amendment No. 1 dated as
of the date hereof and as may be amended or modified from time to time in the
future, among the Corporation and the parties named therein.
"Regulatory Problem" means (i) any set of facts or circumstances
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wherein it has been asserted by any governmental regulatory agency, or a
Stockholder believes based on advice of counsel that there is a substantial risk
of such assertion, that such Stockholder is not legally permitted to hold, or
exercise any significant right with respect to, the securities (including any
Securities or debt securities) of the Corporation which it holds or (ii) a
Voting Regulatory Problem.
"Remaining Retiring Shares" has the meaning ascribed to it in Section
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14(a).
"Requisite Stockholders" means a Majority of the Institutional
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Stockholders and a Majority of the DGHA Stockholders; provided, however, that if
the Majority of the Institutional Stockholders have designated the Additional
Institutional Directors pursuant to Section 2(b) hereof, "Requisite
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Stockholders" means, solely for purposes of Section 4(a) (other than subsection
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4(a)(vii) and subsection 4(a)(xi) only with respect to any transactions between
the Corporation or any of its Subsidiaries and any Institutional Stockholder),
Section 4(b) and Section 13, a Majority of the Institutional Stockholders.
"Requisite Stockholder Approval" means the approval of the terms,
------------------------------
vesting or any other characteristics of any restricted stock of the Corporation,
or any compensation arrangement relating to the Corporation, by vote or written
consent in lieu thereof, that is intended to satisfy the requirements of Code
Section 280G(b)(5) and applicable Treasury Regulations thereunder, and shall
also include any vote (with or without a meeting) or any other action or
actions.
"Restricted Securities" means, at any point in time, any Securities
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which have not theretofore been transferred in a Public Sale.
"Retiring Participation Shares" has the meaning ascribed to it in
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Section 14(a).
"Retiring Shares" has the meaning ascribed to it in Section 14(a).
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"Retiring Stockholder" has the meaning ascribed to it in Section
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14(a).
"Rule 144" means Rule 144 promulgated by the Securities and Exchange
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Commission under the Securities Act as such rule may be amended from time to
time, or any similar rule then in force.
"Sale of the Company" has the meaning ascribed to it in Section 13(a).
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"Sale Notice" has the meaning ascribed to it in Section 13(a).
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"Second Retirement Notice" has the meaning ascribed to it in Section
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14(a).
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"Second Priority Eligible Stockholders" shall mean (i) with respect to
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any Transfer to be made by a DGHA Stockholder, the Stockholders other than the
DGHA Stockholders, (ii) with respect to any Transfer to be made by a Manager
Stockholder, the Stockholders other than the Manager Stockholders, and (iii)
with respect to any Transfer to be made by a Non-Affiliated Stockholder, the
Stockholders other than the Non-Affiliated Stockholders.
"Second Retirement Notice" has the meaning ascribed to it in Section
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14(b).
"Section 12 Acceptance" shall have the meaning ascribed to it in
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Section 12(a).
"Section 12 Notice" shall have the meaning ascribed to it in Section
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12(a).
"Section 12 Offer" shall have the meaning ascribed to it in Section
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12(a).
"Section 12 Offeree" shall have the meaning ascribed to it in Section
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12(a).
"Section 12 Offeror" shall have the meaning ascribed to it in Section
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12(a).
"Securities" means the Common Stock, the Preferred Stock, and any and
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all other Common Stock, Preferred Stock or other capital stock or equity
securities (including the Warrants and other derivative securities therefor) of
the Corporation.
"Securities Act" means the Securities Act of 1933, as amended, or any
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similar federal law then in force.
"Securities and Exchange Commission" includes any governmental body or
----------------------------------
agency succeeding to the functions thereof
"Seller Preferred Stock" means the Series C Preferred Stock, $0.01 par
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value, of the Corporation issued to U.S. Borax Inc. upon the closing of the
Stock Purchase Agreement.
"Series A Preferred Stock" means the Series A Preferred Stock, $0.01
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par value, of the Corporation.
"Series B Preferred Stock" means the Series B Preferred Stock, $0.01
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par value, of the Corporation.
"Single Employer Plan" means a single employer plan, as defined in
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Section 4001(a)(15) of ERISA, that (a) is maintained for employees of any
Obligor or any ERISA Affiliate and no Person other than the Obligors and the
ERISA Affiliates or (b) was so maintained and in respect of which any Obligor or
any ERISA Affiliate could have liability under Section 4069 of ERISA in the
event such plan has been or were to be terminated.
"Stock Purchase Agreement" means the Stock Purchase Agreement between
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U.S. Borax Inc. and the Corporation dated October 23, 1995, as amended or
modified from time to time.
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"Subscription Agreement" shall mean the Stock Subscription and
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Exchange Agreement dated the Original Agreement Date, among the Corporation and
the Stockholders which are parties thereto.
"Subsidiary" means with respect to any Person, any corporation or
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other entity of which the shares of stock having a majority of the general
voting power in electing the board of directors of such corporation or other
entity are, at the time as of which any determination is being made, owned by
such Person either directly or indirectly through Subsidiaries.
"Tax Sharing Agreement" means the Amended and Restated Tax Sharing
---------------------
Agreement dated as of July 21, 1998 between the Corporation and the parties
named therein.
"Termination Event" has the meaning ascribed to it in Section 14(d).
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"Transfer" shall be construed broadly and shall include any transfer
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(whether voluntary, involuntary or by operation of law) of securities or any
interest therein, including without limitation, by way of issuance, sale,
participation, pledge, gift, bequeath, intestate transfer, distribution,
liquidation, merger or consolidation.
"Transfer Date" has the meaning ascribed to it in Section 14(e).
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"Trigger Event" shall mean (a) the existence of a Credit Event or the
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occurrence of an EBITDA Event, (b) the termination of the Exclusive Period or
(c) both of Mr. D. Xxxxxx Xxxxxx and Xx. Xxxxxxx X. Xxxxxxxxxx shall have
ceased to serve on the Board due to death, disability or resignation.
"U.S. Silica" means U.S. Silica Company, a Delaware corporation.
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"Valuation Price per Share" means, with respect to any Security, the
-------------------------
amount distributable to such Security, if the Company is sold at Fair Value and
the proceeds are distributed by the Corporation in complete liquidation pursuant
to the rights and preferences set forth in the Certificate immediately prior to
the Notice Date.
"Voting Regulatory Problem" shall exist when a Person and such
-------------------------
Person's Affiliates would own, control or have power over a greater quantity of
securities (including any Securities or debt securities) of any kind issued by
the Corporation or any successor than are permitted under any requirement of any
governmental authority having jurisdiction over such Person.
"Voting Securities" means the Class A Common Stock, the Series B
-----------------
Preferred Stock (from and after a Trigger Event in accordance with the terms of
the Certificate) and any other Securities of the Corporation which shall at the
time in question be entitled to vote on each matter as to which stockholders of
the Corporation are entitled to vote.
"Warrants" means the warrants to purchase shares of Series A Preferred
--------
Stock and Series B Preferred Stock granted from time to time pursuant to the
Warrant Issuance Agreement.
11
"Warrant Issuance Agreement" means a Warrant Issuance Agreement or
--------------------------
similar document to be entered into by the Corporation and the Persons who
shall, from time to time, purchase Warrants.
"Withdrawal Liability" has the meaning assigned to such term in Part I
--------------------
of Subtitle E of Title IV of ERISA.
(b) The use in this Agreement of the term "including" means
"including, without limitation." The words "herein," "hereof," "hereunder"
and other words of similar import refer to this Agreement as a whole,
including the schedules and exhibits, as the same may from time to time be
amended or supplemented, and not to any particular subparagraph or clause
contained in this Agreement. All references to schedules and exhibits mean
the schedules and exhibits attached to this Agreement.
(c) Unless otherwise expressly set forth herein, whenever the term
"best efforts" is used, such efforts shall not include any obligation to
incur substantial expenses or liabilities.
(d) The title of and the section and paragraph headings in this
Agreement are for convenience of reference only and shall not govern the
interpretation of any of the terms or provisions of this Agreement.
(e) The use herein of the masculine, feminine or neuter forms shall
also denote the other forms, as in each case the context may require.
(f) Where specific language is used to clarify by example a general
statement contained herein, such specific language shall not be deemed to
modify, limit or restrict in any manner the construction of the general
statement to which it relates. The language used in this Agreement has
been chosen by the parties to express their mutual intent, and no rule of
strict construction shall be applied against any party.
SECTION 2. Board of Directors; Adjustment EBITDA Targets.
---------------------------------------------
(a) Election of Directors Generally. Each Stockholder shall from
-------------------------------
time to time take such action, in his capacity as a stockholder of the
Corporation, including the voting of all Securities owned or controlled by
such Stockholder, as may be necessary to cause the Corporation to be
managed at all times by a Board, consisting of seven members to be
designated as follows:
(i) for so long as D. Xxxxxx Xxxxxx and his Affiliates own
50% or more of the Securities (other than DGHA Restricted Shares) held
by them on the Original Agreement Date, two directors shall be
designated by D. Xxxxxx Xxxxxx, one of which designated directors
shall be D. Xxxxxx Xxxxxx (each a "Xxxxxx Xxxxxx Director" and
together the "Xxxxxx Xxxxxx Directors");
(ii) for so long as Xxxxxxx X. Xxxxxxxxxx and his Affiliates
own 50% or more of the Securities (other than the DGHA Restricted
Shares) held by them on
12
the Original Agreement Date, one director shall be designated by
Xxxxxxx X. Xxxxxxxxxx (the "Xxxxxxxxxx Director");
(iii) three directors shall be designated by a Majority of the
Institutional Stockholders (each an "Initial Institutional Director"
and together the "Initial Institutional Directors");
(iv) one director shall be the President of the Corporation;
(v) for so long as D. Xxxxxx Xxxxxx shall be elected as a
director he shall also be elected as the Chairman of the Board and
Chief Executive Officer of the Corporation, and for so long as Xxxxxxx
X. Xxxxxxxxxx shall be elected as a director he shall also be elected
as the Vice-Chairman of the Board;
Notwithstanding the forgoing, in the event of a Termination Event with
respect to D. Xxxxxx Xxxxxx or Xxxxxxx X. Xxxxxxxxxx, the DGHA Stockholder with
respect to which such Termination Event has occurred shall not be entitled to
designate any directors and the Xxxxxx Directors or the Xxxxxxxxxx Director, as
applicable, shall thereafter be designated by the Majority of the DGHA
Stockholders.
(b) Election of Additional Institutional Directors. In addition to
----------------------------------------------
the directors designated pursuant to Section 2(a), upon the occurrence of a
Trigger Event, the Majority of the Institutional Stockholders shall have
the right to designate two additional directors (each an "Additional
Institutional Director" and together the "Additional Institutional
Directors") so as to cause the directors designated by the Institutional
Stockholders to constitute a majority of the directors on the Board;
provided, however, that such right shall be exercisable by the Majority of
-------- -------
the Institutional Stockholders only upon the delivery to the Corporation,
during the continuance of the Trigger Event, of a written notice by a
representative of the Majority of the Institutional Stockholders of their
desire to designate the Additional Institutional Directors. The Initial
Institutional Directors and the Additional Institutional Directors are
referred to herein collectively as the "Institutional Directors" and each,
individually, an "Institutional Director". Each Stockholder shall, at such
times as the Majority of the Institutional Stockholders are entitled to
designate the Additional Institutional Directors and upon written notice
from the Corporation or take such action, in his capacity as a stockholder
of the Corporation, including the voting of all Securities owned or
controlled by such Stockholder, as may be necessary to cause the Additional
Institutional Directors to be elected to the Board.
(c) Compensation Committee. Each Stockholder shall from time to
----------------------
time take such action, in his capacity as a stockholder of the Corporation,
including the voting of all Securities owned or controlled by such
Stockholder, as may be necessary to cause a Compensation Committee of the
Board to be constituted and to consist of three directors, two of which
shall be Institutional Directors and one of which shall be a D. Xxxxxx
Xxxxxx Director.
13
(d) Expenses. The Corporation shall pay the reasonable out-of-
--------
pocket expenses incurred by each Board member designated pursuant to
Section 2(a) or 2(b) in connection with attending the meetings of the Board
and any committees thereof.
(e) Covenant to Vote. Each of the Stockholders agrees to vote, in
----------------
person or by proxy, all of the Securities owned by such Stockholder and
entitled to vote at any annual or special meeting of the stockholders of
the Corporation called for the purpose of voting on the election of
directors, or to execute a written consent in lieu thereof, in favor of the
election of the directors selected in accordance with Section 2(a) or 2(b).
(f) Removal of Directors.
--------------------
(i) At all times (A) a Majority of the Institutional
Stockholders shall have the right to recommend the removal, without
cause, of any or all of the Institutional Directors, (B) D. Xxxxxx
Xxxxxx (or, if the Xxxxxx Xxxxxx Directors are at such time designated
by the Majority of the DGHA Stockholders, the Majority of the DGHA
Stockholders) shall have the right to recommend the removal, without
cause, of any or all of the Xxxxxx Xxxxxx Directors, and (C) Xxxxxxx
X. Xxxxxxxxxx (or, if the Xxxxxxxxxx Director is at such time
designated by the Majority of the DGHA Stockholders the Majority of
the DGHA Stockholders) shall have the right to recommend the removal,
without cause, of the Xxxxxxxxxx Director.
(ii) In the event that any Stockholder acting as described in
Section 2(f)(i) shall, in accordance with their rights specified
herein, recommend the removal of any director or directors with
respect to whom they have such right, then each of the other
Stockholders hereby agrees to join with such acting Stockholder in
recommending such removal as described above, and in causing the
Corporation either to promptly hold a special meeting of stockholders
and to vote, in person or by proxy, all of the Securities owned by
such Stockholder and entitled to vote at such meeting or to execute a
written consent in lieu thereof, as the case may be, in favor of such
removal.
(g) Vacancies. In the event a vacancy is created on the Board by
---------
reason of the death, removal or resignation of any director, (i) such
vacancy may be filled by the remaining directors in accordance with
Sections 2(a) or 2(b), as applicable, (ii) if not so filled, each of the
Stockholders hereby agrees, in its capacity as a stockholder of the
Corporation, to elect a director to fill such vacancy in accordance with
the selection procedures set forth in Sections 2(a) and 2(b) as applicable.
Such election shall occur within thirty days after such vacancy occurs.
Each of the Stockholders hereby agrees, in his capacity as a stockholder of
the Corporation, to use his best efforts to cause the Corporation either to
promptly hold a special meeting of stockholders or to execute a written
consent in lieu thereof, and each of the Stockholders hereby agrees to vote
all of the Securities owned by such Stockholder and entitled to vote at
such meeting, in person or by proxy, or pursuant to such written consent of
stockholders, in favor of the person or persons selected in accordance with
Sections 2(a) or 2(b) to fill such vacancy and, if
14
necessary, in favor of removing any director elected to fill such vacancy
other than in accordance with the selection procedures of Sections 2(a) or
2(b).
(h) No Inconsistent Agreements. Each Stockholder represents that he
--------------------------
has not granted and is not a party to any proxy, voting trust or other
agreement which is inconsistent with or conflicts with the provisions of
this Agreement, and no Stockholder shall grant any proxy or become party to
any voting trust or other agreement which is inconsistent with or conflicts
with the provisions of this Agreement.
(i) Budgeted EBITDA. In the event the Corporation or any Subsidiary
---------------
makes any material capital expenditures not contemplated by the projections
upon which the Budgeted EBITDA targets are based, or the Corporation or any
Subsidiary consummates any mergers, acquisitions or dispositions (whether
of assets or stock or other interests) or other extraordinary transactions,
the Board will determine in good faith appropriate adjustments to the
Budgeted EBITDA targets, which adjustments shall be final and binding.
(j) Appointment of President. Upon the removal or resignation of
------------------------
the President of the Corporation, his successor shall be appointed by the
vote of a majority of the directors on the Board and the outgoing President
shall abstain from such vote.
SECTION 3. Financial Statements and Other Information, Inspections and
-----------------------------------------------------------
Board Meetings.
--------------
(a) Prior to the consummation of an Initial Public Offering, the
Corporation will deliver to each Stockholder having a Proportionate
Percentage of at least 5%:
(i) as soon as available but in any event within 30 days after
the end of each calendar month (the "Accounting Periods") in each
fiscal year, unaudited consolidated statements of income and cash
flows of the Corporation and its Subsidiaries for such Accounting
Period and for the period from the beginning of the fiscal year to the
end of such Accounting Period, which statements shall also include the
EBITDA of the Corporation and its Subsidiaries for such Accounting
Period, and consolidated balance sheets of the Corporation and its
Subsidiaries as of the end of such Accounting Period, setting forth in
each case comparisons to the corresponding period in the annual budget
and to the corresponding period in the preceding fiscal year with
variances delineated, and all such statements will be prepared in
accordance with generally accepted accounting principles, consistently
applied;
(ii) as soon as available but in any event within 45 days after
the end of each fiscal quarter of the Corporation unaudited
consolidated statements of income and cash flows of the Corporation
and its Subsidiaries for such fiscal quarter, setting forth in each
case comparisons to the corresponding period in the annual budget and
to the corresponding period in the preceding fiscal year with
variances delineated, and accompanied by a written report of the
Corporation's Chief Executive Officer, Chief Operating Officer or
Chief Financial Officer with
15
respect to (a) such Officer's lack of actual knowledge after due
investigation of any condition or event which constitutes an event of
default under the terms of this Agreement, a Credit Event or an EBITDA
Event; (b) the operations, problems and achievements of the
Corporation during such period and (c) the calculation of the
financial tests required under the Credit Agreement for such period
(such written report being referred to herein as the "Officer's
Report");
(iii) as soon as available but in any event within 90 days
after the end of each fiscal year of the Corporation, audited
consolidated statements of income and cash flows of the Corporation
and its Subsidiaries for such year, and the related balance sheets of
the Corporation and its Subsidiaries as of the end of such year,
setting forth in each case in comparative form the corresponding
figures for the preceding fiscal year and for the annual budget for
such year, and accompanied by (a) an opinion thereon of independent
certified public accountants reasonably acceptable to a majority in
interest of all Stockholders (it being agreed that Price Waterhouse
Coopers is acceptable), which opinion shall state that said financial
statements (other than the annual budget) fairly present the financial
condition and results of operations of the Corporation and its
Subsidiaries as at the end of, and for, such fiscal year, (b) a letter
from such accounting firm stating that in the course of its
examination they obtained no knowledge, except as specifically stated,
that there was a default in existence by the Corporation or any
Subsidiary under this Agreement or any other material agreement to
which the Corporation or any Subsidiary is a party and (c) an
Officer's Report;
(iv) promptly upon receipt thereof, any additional reports,
management letters (including the annual management letter to the
Board) or other detailed information concerning significant aspects of
the Corporation's and its Subsidiaries' operations and financial
affairs given to the Corporation by its independent accountants (and
not otherwise contained in other materials provided hereunder);
(v) no later than 30 days prior to the end of each fiscal year,
a consolidated annual budget prepared on a monthly basis for the
Corporation and its Subsidiaries for the succeeding fiscal year
(displaying anticipated statements of income and cash flows and
balance sheets);
(vi) promptly (but in any event within ten (10) business days)
after the discovery or receipt of notice of (a) any default under the
terms of any material agreement to which the Corporation or any
Subsidiary is a party (including without limitation, this Agreement)
or, without limitation to the generality of the foregoing, a Trigger
Event or any other adverse event or circumstance affecting the
Corporation or any Subsidiary which is material to the Corporation and
its Subsidiaries taken as a whole (including the filing of any
material litigation against the Corporation or any Subsidiary or the
existence of a dispute that may reasonably be expected to lead to
material litigation) or (b) any noncompliance by the Corporation or
any Subsidiary with applicable laws, rules and regulations of
16
all governmental authorities, the violation of which might reasonably
be expected to have a material adverse effect upon the financial
condition of the Corporation and its Subsidiaries taken as a whole, an
Officer's Certificate specifying the nature and a period of existence
thereof and what actions the Corporation and its Subsidiaries have
taken and propose to take with respect thereto;
(vii) within ten (10) days after transmission thereof, copies
of all registration statements which the Corporation files with the
Securities and Exchange Commission, and copies of all press releases
and other statements made available generally by the Corporation to
the public concerning material developments in the Corporation's
business;
(viii) immediately upon receipt thereof, copies of all
environmental reports or other communications concerning environmental
matters of the Corporation or its Subsidiaries which might reasonably
be expected to have a material adverse effect upon the financial
condition of the Corporation and its Subsidiaries taken as a whole;
and
(ix) with reasonable promptness, such other information and
financial data concerning the Corporation and its Subsidiaries as any
Stockholder having a Proportionate Percentage of at least 5% may
reasonably request.
To the best of the Corporation's knowledge, each of the financial
statements referred to in subparagraphs (i), (ii) and (iii) will be true and
correct in all material respects as of the dates and for the periods stated
therein, subject in the case of the unaudited financial statements to footnotes
and changes resulting from normal year-end audit adjustments.
The Corporation will provide to all Stockholders, when available,
audited consolidated statements of income and cash flows of the Corporation and
its Subsidiaries and the related consolidated balance sheet of the Corporation
and its Subsidiaries, accompanied by an opinion thereon of the Corporation's
independent certified public accountant.
(b) Except as consented to in writing by the Corporation or as
otherwise required by law or judicial order or decree or by any
governmental agency or authority, each Person which obtains information
regarding the Corporation and its Subsidiaries under this Section 3 will
use its best efforts to maintain the confidentiality of all nonpublic
information obtained by it hereunder which the Corporation has reasonably
designated as proprietary or confidential in nature; provided that each
such Person may disclose such information to a Permitted Transferee in
connection with the sale or transfer of any Securities if such Permitted
Transferee agrees in writing to be bound by the provisions hereof.
(c) Prior to the consummation of an Initial Public Offering, the
Corporation will permit each representative designated by any Stockholder
having a Proportionate Percentage of at least 5%, upon reasonable notice to
the Chief Executive Officer of the Corporation, during normal business
hours or such other times as any such holder may reasonably request and in
such manner so as not to unreasonably interfere with the
17
business and operations of the Corporation or any Subsidiary, to, at such
holder's expense, (i) visit and inspect any of the properties of the
Corporation and its Subsidiaries, (ii) examine the corporate and financial
records of the Corporation and its Subsidiaries and make copies thereof or
extracts therefrom and (iii) discuss the affairs, finances and accounts of
any such corporations with the directors, officers, key employees and
independent accountants of the Corporation and its Subsidiaries.
SECTION 4. Additional Voting Agreements; Required Sale.
-------------------------------------------
(a) The Corporation shall not, and shall ensure that each Subsidiary
shall not, without the affirmative vote or written consent of the Requisite
Stockholders:
(i) consummate a Public Offering;
(ii) except as contemplated by this Agreement, the
Subscription Agreement or the Warrant Issuance Agreement, after it
shall have been executed, issue any Securities other than to the
Corporation or to a wholly-owned Subsidiary;
(iii) merge or consolidate with or into another entity (other
than mergers of wholly-owned Subsidiaries and mergers of a wholly-
owned Subsidiary with and into the Corporation where the Corporation
is the surviving corporation);
(iv) acquire any business from, or capital stock of, any
Person;
(v) redeem the Seller Preferred Stock, otherwise than as
required pursuant to the Certificate;
(vi) amend its Certificate of Incorporation;
(vii) amend its Bylaws;
(viii) increase the compensation of any of its officers,
directors or management employees, above the levels in existence as of
the date hereof, or pay any fees to directors unless approved by the
Compensation Committee;
(ix) sell, lease, exchange, convey, license or otherwise
dispose of in any 12-month period in excess of 10% (or, in the
aggregate during the term of this Agreement, in excess of 25%) of its
consolidated assets or assets which contributed 10% (or, in the
aggregate during the term of this Agreement, in excess of 25%), or
more of its average annual EBITDA over the last 12 fiscal months, in
any transaction or series of related transactions (other than sales in
the ordinary course of business);
(x) liquidate, dissolve or effect a recapitalization or
reorganization in any form of transaction;
18
(xi) enter into, revise or amend any contract, agreement or
transaction with any of its officers, directors, management employees
or Affiliates, except for (a) the entering into of the Management
Services Agreement, the DGHA Fee Letter, the Warrant Issuance
Agreement, the Registration Rights Agreement, the Tax Sharing
Agreement, the DGHA Repurchase Agreement and the Manager Repurchase
Agreement and the amendment of the Management Services Agreement
contemplated by Section 5(d) thereof and (b) employment related
transactions on customary terms, bonus plans approved by the
Compensation Committee and for normal employment arrangements and
benefit programs on reasonable terms and except as otherwise
contemplated by this Agreement;
(xii) incur or create, any indebtedness for borrowed money in
excess of the amounts permitted by the Debt Documents;
(xiii) make any loans or advances to, guarantees for the benefit
of, or investments in, any Person (other than a wholly-owned
Subsidiary), except as permitted by the Debt Documents or the
Management Services Agreement and except for (a) reasonable advances
to employees in the ordinary course of business, (b) investments
having a stated maturity no greater than one year from the date the
Corporation makes such investment in (1) obligations of the United
States government or any agency thereof or obligations guaranteed by
the United States government, (2) certificates of deposit of
commercial banks having combined capital and surplus of at least $50
million or (3) commercial paper with a rating of at least "Prime-1" by
Xxxxx'x Investors Service, Inc. or "A- 1" by Standard & Poor's
Corporation and (c) repurchase obligations with a term of not more
than seven days for underlying securities of the types described in
clause (b)(1) of this subparagraph (xiii) entered into with any bank
meeting the qualifications specified in clause (b)(2) of this
subparagraph (xiii);
(xiv) declare or pay any dividends upon the Securities (other
than the Series A Preferred Stock and the Seller Preferred Stock); or
(xv) take any action that would cause the Corporation or any
Subsidiary to incur a material liability to any Plan or the PBGC or
substantially increase the rate of annual contributions to any Plan.
(b) At all times during the term of this Agreement the Corporation
will, and will cause each Subsidiary to unless consent is obtained from the
Requisite Stockholders:
(i) cause to be done all things necessary to maintain,
preserve and renew its corporate existence and all material licenses,
authorizations and permits necessary to the conduct of its businesses;
(ii) maintain and keep its properties in good repair, working
order and condition, and from time to time make all necessary or
desirable repairs, renewals and replacements, so that its businesses
may be properly and advantageously conducted at all times;
19
(iii) pay and discharge when payable all taxes, assessments and
governmental charges imposed upon its properties or upon the income or
profits therefrom (in each case before the same becomes delinquent and
before penalties accrue thereon) and all claims for labor, materials
or supplies which if unpaid might by law become a lien upon any of its
property, unless and to the extent that the same are being contested
in good faith and by appropriate proceedings and adequate reserves (as
determined in accordance with generally accepted accounting
principles, consistently applied) have been established on its books
with respect thereto;
(iv) comply with all other material obligations which it
incurs pursuant to any contract or agreement, whether oral or written,
express or implied, as such obligations become due, unless and to the
extent that the same are being contested in good faith and by
appropriate proceedings and adequate reserves (as determined in
accordance with generally accepted accounting principles, consistently
applied) have been established on its books with respect thereto;
(v) comply with all applicable laws, rules and regulations of
all governmental authorities, the violation of which might reasonably
be expected to have a material adverse effect upon the financial
condition, operating results or business prospects of the Corporation
and its Subsidiaries taken as a whole;
(vi) maintain proper books of record and account which fairly
present its financial condition and results of operations and make
provisions on its financial statements for all such proper reserves as
in each case are required in accordance with generally accepted
accounting principles, consistently applied;
(vii) comply with all environmental regulations and orders with
respect to such regulations, provided that this subparagraph shall not
limit the ability of the Corporation or any Subsidiary thereof to
contest in good faith any such order or regulation;
(viii) apply for and continue in force with good and
responsible insurance companies adequate insurance covering risks of
such types and in such amounts as are customary for well-insured
corporations of similar size engaged in similar lines of business, all
as determined by the Board,
(ix) (A) promptly and in any event within 10 days after
Acquisition or any ERISA Affiliate knows or has reason to know that
any ERISA Event has occurred, furnish to CMC a statement of the chief
financial officer or treasurer of Acquisition describing such ERISA
Event and the action, if any, that Acquisition or such ERISA Affiliate
has taken and proposes to take with respect thereto and (B) on the
date any records, documents or other information must be furnished to
the PBGC with respect to any Plan pursuant to Section 4010 of ERISA,
furnish to CMC a copy of such records, documents and information;
20
(x) promptly and in any event within five days after receipt
thereof by Acquisition or any ERISA Affiliate, furnish to CMC copies
of each notice from the PBGC stating its intention to terminate any
Plan or to have a trustee appointed to administer any Plan;
(xi) furnish to CMC promptly upon receipt thereof by the
Company or any ERISA Affiliate, a copy of the annual actuarial
valuation report of each Plan; and
(xii) promptly and in any event within ten days after receipt
thereof by Acquisition or any ERISA Affiliate from the sponsor of a
Multiemployer Plan, furnish to CMC copies of each notice concerning
(i) the imposition of Withdrawal Liability by any such Multiemployer
Plan, (ii) the reorganization or termination, within the meaning of
Title IV of ERISA, of any such Multiemployer Plan or (iii) the amount
of liability incurred, or that may be incurred, by Acquisition or any
ERISA Affiliate in connection with any event described in clause (i)
or (ii).
(c) Each Stockholder shall in his capacity as a stockholder of the
Corporation, cause that the Corporation observe and perform its obligations
under Section 4(a) and Section 4(b).
SECTION 5. First Refusal Rights for Securities Issued by the Corporation.
-------------------------------------------------------------
(a) Except for the issuance of Securities in connection with an
Exempt Issuance, if the Corporation authorizes the issuance and sale to any
other Person of any Securities or any securities containing options or
rights to acquire any Securities (the "First Refusal Securities"), the
Corporation will first offer to sell to each Stockholder a portion of the
First Refusal Securities in an amount equal to such Stockholder's
Proportionate Percentage of the First Refusal Securities (the "First
Refusal Amount"). Each Stockholder will be entitled to purchase the First
Refusal Securities at the same price per share and on the same terms as the
First Refusal Securities are to be offered to such other Person.
(b) Each Stockholder must exercise its purchase rights hereunder
within 20 days after receipt of written notice from the Corporation
describing in reasonable detail the First Refusal Securities being offered,
the purchase price per share, the payment terms and such Stockholder's
Proportionate Percentage and First Refusal Amount. If all of the First
Refusal Securities offered to the Stockholders are not fully subscribed by
such Stockholders, the remaining First Refusal Securities will be reoffered
to the Stockholders purchasing their entire First Refusal Amount upon the
terms set forth in this Section until all such First Refusal Securities are
fully subscribed or until all such Stockholders have subscribed for all
such First Refusal Securities which they desire to purchase, except that
such Stockholders must exercise their purchase rights within 5 days after
receipt of all such reoffers.
(c) Upon the expiration of the offering periods described above, the
Corporation will be free to sell such First Refusal Securities which such
Stockholders
21
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 such Stockholders. Any First Refusal Securities offered or
sold by the Corporation after such 60-day period must be reoffered to the
Stockholders pursuant to the terms of this Section.
(d) Payment for First Refusal Securities which a Stockholder has
elected to purchase shall be made against delivery of (i) the certificates
representing the First Refusal Securities at the principal office of the
Corporation not earlier than 10 days nor later than 20 days after
expiration of the 20 days or 5 days referred to in Section 5(b), as the
case may be, and (ii) of the entire price, by cash, certified or bank
cashier's check, or such other consideration specified in the Corporation's
offer.
SECTION 6. Affiliate Transactions.
----------------------
Payments made by the Corporation to DGHA pursuant to the Management
Services Agreement shall be the only payments permitted to be made by the
Corporation to DGHA and its Affiliates without the consent of a majority of the
Institutional Directors.
SECTION 7. Issuance of Additional Securities to DGHA Stockholders and
----------------------------------------------------------
Manager Stockholders.
--------------------
(a) The Corporation shall have the right, but not the obligation, to
issue to the Manager Stockholders from time to time, at the discretion of
the Board, any portion of the Manager Restricted Shares that are not issued
and outstanding on or after the date hereof, at a purchase price of $.01
per share; provided, however, that it shall be a condition precedent of the
-------- -------
issue of any Manager Restricted Shares that each Manager Stockholder to
whom any Manager Restricted Shares are issued shall have executed and
delivered to the Corporation a counterpart signature page to this Agreement
and the Manager Repurchase Agreement, pursuant to which such Manager
Stockholder agrees to be bound by the provisions of this Agreement and the
Manager Repurchase Agreement.
(b) The Corporation shall have the right, but not the obligation, to
issue to the DGHA Stockholders from time to time, at the discretion of the
Chairman of the Corporation, any portion of the DGHA Restricted Shares that
are not issued and outstanding on or after the date hereof, at a purchase
price of $.01 per share; provided, however, that it shall be a condition
-------- -------
precedent of the issue of any DGHA Restricted Shares that each DGHA
Stockholder to whom any DGHA Restricted Shares are issued shall have
executed and delivered to the Corporation a counterpart signature page of
this Agreement and the DGHA Repurchase Agreement, pursuant to which such
DGHA Stockholder agrees to be bound by the provisions of this Agreement and
the DGHA Repurchase Agreement.
SECTION 8. Limitations on Transfers of Stock - General.
-------------------------------------------
(a) The provisions regarding Transfers of Securities contained herein
shall apply to all Securities now owned or hereafter acquired by a
Stockholder, including Securities acquired by reason of any dividend,
distribution, exchange or conversion, additional issuances of Securities,
and acquisitions of outstanding Securities from another
22
Person, and such provisions shall apply to any Securities obtained by a
Stockholder upon the exercise, exchange or conversion of any option,
warrant or other Security.
(b) No Stockholder shall Transfer any Security to a Person not
already a party to this Agreement as a Stockholder unless and until such
Person executes and delivers to the Corporation a written agreement in form
and substance reasonably acceptable to the Corporation pursuant to which
such Person shall agree to become a party to, and to be bound by and to
comply with the provisions of, this Agreement in the same capacity and to
the same extent as the Stockholder Transferring such Security. In the event
of any Transfer to an Affiliate contemplated by clauses (i) (A) or (i)(B)
of the definition thereof, the Transferee shall grant an irrevocable proxy,
which shall be deemed to be coupled with an interest, with respect to
voting rights of such Securities to D. Xxxxxx Xxxxxx (or, if D. Xxxxxx
Xxxxxx is no longer a Stockholder or if the transferor is D. Xxxxxx Xxxxxx,
to Xxxxxxx X. Xxxxxxxxxx and if Xxxxxxx X. Xxxxxxxxxx is no longer a
Stockholder, to an individual elected by a majority of the Board), which
proxy shall expire upon an Initial Public Offering. Any Transfer of
Securities that is not made in compliance with the provisions hereof shall
be void ab initio.
(c) Any provision of this Agreement to the contrary notwithstanding,
no Stockholder shall (i) Transfer any Security to a Person which is a
Competitor or to any Affiliates of a Competitor, (ii) effect any Transfer
which would subject the Corporation to the reporting requirements of the
Exchange Act or (iii) Transfer any Security to any Person if such Transfer
would result in an event of default under any Debt Document.
(d) The restrictions on Transfer contained in Sections 9, 10, 11 and
12 shall not apply with respect to any Transfer of Securities by any
Stockholder to its Affiliates.
SECTION 9. Limitations on Transfers of Restricted Shares.
---------------------------------------------
Except as permitted by Section 8(d) or pursuant to Section 13, no
Stockholder shall Transfer any Class C Restricted Shares at any time that the
Class C Restricted Shares shall be subject to the restrictions contained in the
DGHA Repurchase Agreement or the Manager Repurchase Agreement.
SECTION 10. Limitations on Transfers prior to Third Anniversary.
---------------------------------------------------
Except as permitted by Section 8(d) or pursuant to Section 13 or
Section 14 and except for sales of Securities by Manager Stockholders (to which
CMC shall have consented in its sole discretion) and Non-Affiliated Stockholders
to DGHA Stockholders or Manager Stockholders on or prior to December 31, 1998 at
a price per share equal to $39.90 for Series B Preferred Stock, $39.90 for Class
A Common Stock and $7.78 for Series A Preferred Stock, plus accrued dividends,
no Stockholder shall Transfer any Securities prior to the third anniversary of
the Original Agreement Date.
SECTION 11. Rights of First Refusal after Third Anniversary.
-----------------------------------------------
Except for Transfers permitted by Section 8(d) or Section 13 and
except for sales of Securities by Manager Stockholders (to which CMC shall have
consented in its sole
23
discretion) and Non-Affiliated Stockholders to DGHA Stockholders or Manager
Stockholders on or prior to December 31, 1998 at a price per share equal to
$39.90 for Series B Preferred Stock, $39.90 for Class A Common Stock and $7.78
for Series A Preferred Stock, plus accrued dividends, on or after the third
anniversary of the Original Agreement Date the Stockholders shall comply with
the following procedures in connection with any Transfer of Securities:
(a) The Stockholder ("Offeror") shall first deliver to the
Corporation a written notice (hereinafter in this Section 11 called the
"Notice of Offer"), which shall be irrevocable for a period of 60 days
after delivery thereof, offering (the "Offer") to the Corporation and the
other Stockholders (the "Offerees") all of the Securities proposed to be
Transferred by the Offeror at the purchase price and on the terms specified
therein (which Notice of Offer shall include all relevant terms of the
proposed Transfer). The Offeror shall also furnish to the Corporation such
additional information relating to the Offer as may reasonably be requested
by the Corporation. The Corporation shall have the right and option, for a
period of 30 days after delivery of the Notice of Offer by the Offeror, to
accept all or any portion of the Securities so offered at the purchase
price and on the terms stated in the Notice of Offer. The Corporation
shall, if it does not elect to purchase all of the offered Securities,
deliver a copy of the Notice of Offer to the Offerees. Each Offeree shall
have the right and option, for a period of 30 days after delivery of the
Notice of Offer by the Corporation, by delivery of written notice to the
Corporation (x) to accept all or any of its Proportionate Percentage of the
Securities so offered at the purchase price and on the terms stated in the
Notice of Offer and (y) to offer to purchase any Securities not accepted by
the other Offerees, in which case the Securities not accepted by the other
Offerees, shall be deemed to have been offered to and accepted by the
Offerees, which exercised their option under this clause (y) pro rata in
--- ----
accordance with their respective Proportionate Percentages (computed
without including the Offerees, who have not exercised their option to
purchase Securities under this clause (y)), on the above-described terms
and conditions, and if all of the offered Securities shall not have been
fully subscribed by such Offerees, the remaining offered Securities will be
reofferred to the Offerees who agreed to purchase their entire entitlement
of offered Securities under clause (x) upon the terms set forth in this
Section until all such Securities are fully subscribed or until all such
Offerees have subscribed for all such offered Securities which they desire
to purchase, except that such Offerees must exercise their purchase rights
within five (5) business days after receipt of all such reoffers.
Notwithstanding the foregoing provisions of this Section 11(a), if the
Offeror is a DGHA Stockholder, a Manager Stockholder, a Non-Affiliated
Stockholder or an Institutional Stockholder, the other DGHA Stockholders,
Manager Stockholders, Non-Affiliated Stockholders or Institutional
Stockholders, as the case may be, shall have the right to purchase, on a
pro rata basis among such Stockholders, all of the Securities so offered
--- ----
prior to any purchases by any other Stockholders.
(b) Transfers of Securities under the terms of this Section 11 shall
be made at the offices of the Corporation on a mutually satisfactory
business day within 15 days after the expiration of the applicable time
periods. Delivery of certificates or other instruments evidencing such
Securities, duly endorsed for transfer and free and clear of all liens and
encumbrances, shall be made on such date against payment of the purchase
price therefor.
24
(c) If the Corporation and the Offerees shall not have accepted to
purchase all the Securities offered for sale pursuant to the aforesaid
Notice of Offer, then the Offeror may Transfer to a third party that number
of the Securities not accepted by the Corporation and the Offerees at the
price and on substantially equivalent terms stated in the original Notice
of Offer, at any time within 180 days after the expiration of the Offers
required by Section 11(a). In the event the Securities are not Transferred
by the Offeror on such terms during such 180-day period, the restrictions
of this Section 11 shall again become applicable to any Transfer of
Securities by the Offeror unless within such 180-day period the Offeror
shall deliver to the Corporation a Notice of Offer with respect to an Offer
of the same Securities at a purchase price which is less than the purchase
price set forth in the previous Offer, in which case the 30-day period
specified in Section 11(a) shall be reduced to 15 days and a new 180-day
period shall begin. Nothing in this Section 11 shall preclude any
Stockholder from engaging in discussions with any investment banker,
potential transferee of Securities or other Person with respect to a
possible purchase of Securities from it, so long as the provisions of this
Section 11 are complied with prior to the consummation of any Transfer to
which this applies.
(d) The Offeror may specify in the Notice of Offer that all
Securities mentioned therein must be Transferred, in which case any
acceptance received pursuant to Section 11(a) shall be deemed conditioned
upon (x) receipt of written notices of binding acceptance with respect to
all Securities mentioned in such Notice of Offer or (y) the Transfer of the
remaining Securities pursuant to Section 11 (c).
SECTION 12. Rights of Co-Sale.
-----------------
(a) Subject to the provisions of Section 12(c), in the event that on
or after the third anniversary of the Original Agreement Date a Stockholder
or group of Stockholders (hereinafter, a "Section 12 Offeree") receives a
bona fide offer (the "Section 12 Offer") from a third party which is not an
---- ----
Affiliate of the Section 12 Offeree (the "Section 12 Offeror") to purchase
from such Section 12 Offeree Securities, for a specified price payable in
cash or otherwise and on specified terms and conditions, such Section 12
Offeree shall promptly forward a notice (the "Section 12 Notice") complying
with Section 12(b) to the Corporation and to the other Stockholders (the
Stockholders receiving a Section 12 Notice collectively referred to herein
as the "Other Stockholders"). The Section 12 Offeree shall not Transfer
any Securities prior to the expiration of the 15-day period referred to
below to the Section 12 Offeror unless the terms of the Section 12 Offer
are extended to each Other Stockholder with respect to its Proportionate
Percentage of the aggregate number and classes of Securities to which the
Section 12 Offer relates, whereupon each Other Stockholder shall be
entitled to Transfer such Other Stockholder's Proportionate Percentage of
the aggregate number of Securities to which the Section 12 Offer relates.
Each Other Stockholder shall have a period of 15 days to deliver a written
notice (the "Section 12 Acceptance") to the Section 12 Offeree evidencing
its acceptance of the Section 12 Offer.
(b) The Section 12 Notice shall set forth (i) the number of
Securities to which the Section 12 Offer relates and the name of the
Section 12 Offeree, (ii) the name and address of the Section 12 Offeror,
(iii) the proposed amount and type of consideration
25
(including, if the consideration consists in whole or in part of non-cash
consideration, such information to the Section 12 Offeree as may be
reasonably necessary for the Other Stockholders to properly analyze the
economic value and investment risk of such non-cash consideration) and the
terms and conditions of payment offered by the Section 12 Offeror and (iv)
that the Section 12 Offeror has been informed of the co-sale rights
provided for in this Section 12, and has agreed to purchase Securities held
by the Other Stockholders in accordance with the terms of this Section 12
(which agreement may contain the Section 12 Offeror's obligation to
purchase all of the Securities held by the Other Stockholders subject to
the Section 12 Offer from the Section 12 Offeree so long as such Section 12
Offeree agrees to purchase simultaneously with such sale from the Other
Stockholders if they deliver a Section 12 Acceptance the Securities held by
the Other Stockholders subject to such Section 12 Notice of Acceptance).
(c) The foregoing provisions of this Section 12 shall not apply to a
Transfer or Transfer(s) by a Stockholder or group of Stockholders of up to
the greater of (i) 0.50% of the Common Equivalents outstanding at such
time, and (ii) 10% of the Securities held by such Stockholder or group of
Stockholders at such time.
SECTION 13. Drag-Along Rights.
-----------------
(a) If the Requisite Stockholders approve a sale of all or
substantially all of the capital stock or assets of the Company to a Person
which is not an Affiliate of any Stockholder (other than an Affiliate of a
DGHA Stockholder) (an "Approved Sale"), whether by way of merger,
consolidation, sale of stock or assets, or otherwise (each, a "Sale of the
Company"), all Stockholders shall consent to and raise no objections
against the Approved Sale, and if the Approved Sale is structured as (A) a
merger or consolidation of the Corporation or a Subsidiary, or a sale of
all or substantially all of the assets of the Corporation or a Subsidiary,
each Stockholder shall waive any dissenters rights, appraisal rights or
similar rights in connection with such merger, consolidation or asset sale,
or (B) a sale of all the capital stock of the Corporation or a Subsidiary,
the Stockholders shall agree to sell their Securities on the terms and
conditions approved by the Requisite Stockholders. The Stockholders shall
take all necessary and desirable actions approved by the Requisite
Stockholders, in connection with the consummation of the Approved Sale,
including the execution of such agreements and such instruments and other
actions reasonably necessary to (1) provide the representations,
warranties, indemnities, covenants, conditions, non-compete agreements,
escrow agreements and other provisions and agreements relating to such
Approved Sale and (2) effectuate the allocation and distribution of the
aggregate consideration upon the Approved Sale as set forth below. The
Stockholders shall be permitted to sell their Securities pursuant to an
Approved Sale without complying with the provisions of Sections 8, 9, 10,
11 or 12 of this Agreement.
(b) The obligations of the Stockholders pursuant to this Section
13 are subject to the satisfaction of the following conditions:
(i) subject to Section 13(b)(iii), upon the consummation of
the Approved Sale, all of the Stockholders shall receive the same
proportion of the
26
aggregate consideration from such Approved Sale that such holder would
have received if such aggregate consideration had been distributed by
the Corporation in complete liquidation pursuant to the rights and
preferences set forth in the Certificate as in effect immediately
prior to such Approved Sale (giving effect to applicable orders of
priority) and after giving effect to the purchase rights (if any) set
forth in the DGHA Repurchase Agreement and the Manager Repurchase
Agreement;
(ii) if any Stockholders of a class are given an option as to
the form and amount of consideration to be received, all holders of
such class will be given the same option;
(iii) all holders of then-currently exercisable Common
Equivalents will be given an opportunity to either (A) exercise such
rights prior to the consummation of the Approved Sale (but only to the
extent such Common Equivalents are then vested) and participate in
such sale as Stockholders or (B) upon the consummation of the Approved
Sale, receive in exchange for such Common Equivalents consideration
equal to the amount determined by multiplying (x) the same amount of
consideration per share of Common Stock (of the same class as that for
which the Common Equivalent is exercisable) received by the holders of
such class of Common Stock in connection with the Approved Sale less
the exercise price per Common Equivalent by (y) the number of
Common Equivalents;
(iv) no Stockholder shall be obligated to make any out-of-
pocket expenditure prior to the consummation of the Approved Sale
(excluding modest expenditures for postage, copies, etc.) and no
Stockholder shall be obligated to pay more than his pro rata share
(based upon the amount of consideration received) of reasonable
expenses incurred in connection with a consummated Approved Sale to
the extent such costs are incurred for the benefit of all Stockholders
and are not otherwise paid by the Corporation or the acquiring party
(costs incurred by or on behalf of a Stockholder for its or his sole
benefit will not be considered costs of the transaction hereunder),
provided that a Stockholder's liability for such expenses shall be
capped at the total purchase price received by such Stockholder for
his Securities (including the exercise price thereof); and
(v) in the event that the Stockholders are required to
provide any representations or indemnities in connection with the
Approved Sale (other than representations and indemnities concerning
each Stockholder's valid ownership of his Securities, free of all
liens and encumbrances (other than those arising under applicable
securities laws), and each Stockholder's authority, power, and right
to enter into and consummate such purchase or merger agreement without
violating any other agreement), then each Stockholder shall not be
liable for more than his pro rata share (based upon the number of
Securities held and not the amount of consideration received) of any
liability for misrepresentation or indemnity and such liability shall
not exceed the total purchase price received by such Stockholder for
his Securities (including the exercise price thereof), after taxes
27
(after giving effect to all potential amendments of tax returns
arising in connection with any indemnification claim) and expenses,
and such liability shall be satisfied solely out of any funds escrowed
for such purpose.
(c) If the Corporation and any of the Stockholders or their
representatives, enter into any negotiation or transaction for which Rule
506 under the Securities Act (or any similar rule then in effect) may be
available with respect to such negotiation or reaction (including a merger,
consolidation or other reorganization), each Stockholder who is not an
accredited investor (as such term is defined in Rule 501 under the
Securities Act) will, at the request of the Corporation or the
Institutional Stockholders, appoint a purchaser representative (as such
term is defined in Rule 501 under the Securities Act) reasonably acceptable
to the Corporation or such Stockholders.
SECTION 14. Options Upon Termination Event.
------------------------------
(a) Upon the occurrence of a Termination Event with respect to a
Stockholder who is a Manager Stockholder or a DGHA Stockholder (except a
Termination Event described in Section 14(d)(ii)(1) or (2) with respect to
a Stockholder who is a DGHA Stockholder), in each case occurring on or
prior to the fifth anniversary of the Original Agreement Date (or at any
time with respect to a Termination Event described in Section 14(d)(i)(1)
or (2) with respect to a Stockholder who is a Manager Stockholder), subject
to Section 14(c), the Corporation shall have the right but not the
obligation to purchase any or all of such Stockholder's (the "Retiring
Stockholder") Securities (other than Class C Restricted Shares) (the
"Retiring Shares"). The Corporation shall have 20 days after the
occurrence of any Termination Event described above in which to give notice
(the "Primary Retirement Notice") to the Retiring Stockholder of its
election to purchase all of the Retiring Shares. The Primary Retirement
Notice will disclose in reasonable detail the Corporation's election to
purchase all of the Retiring Shares and the terms and conditions of the
sale including the price per share of the Retiring Shares. In the event
that the Corporation does not elect to purchase all of the Retiring Shares,
the Corporation shall, within 20 days after the occurrence of any
Termination Event described above, deliver, on behalf of the Retiring
Stockholder but at the expense of the Corporation, a written notice (the
"Secondary Retirement Notice") to the remaining Stockholders (the "Eligible
Stockholders") and the Retiring Stockholder, which Secondary Retirement
Notice will disclose in reasonable detail the terms and conditions of the
sale including the total number of Retiring Shares and the number of
Retiring Shares, if any, to be purchased by the Corporation and the price
per share of the Retiring Shares. Upon receipt of the Secondary Retirement
Notice, each Eligible Stockholder shall have a right to purchase the
Retiring Shares which will not be purchased by the Corporation (the "R
Retiring Shares"), in the case of each Eligible Stockholder, up to that
number of the Retiring Shares equal to such Eligible Stockholder's Adjusted
Proportionate Percentage of the Remaining Retiring Shares (such number of
shares hereinafter referred to as the "Retiring Participation Shares") with
respect to such Eligible Stockholder. The Eligible Stockholders shall have
20 days after the Secondary Retirement Notice is received in which to give
counter-notice of such Eligible Stockholder's election to purchase such
Remaining Retiring Shares (such election by an Eligible Stockholder being
referred to as an "Initial Retiring Purchase"). An Initial Retiring
Purchase by an Eligible Stockholder
28
may be of all or part of his or its Retiring Participation Shares. Any
Eligible Stockholder may at any time elect in his or its counter-notice to
purchase, in addition to his or its Retiring Participation Shares, the
balance (or the balance up to a maximum stated number) of any Remaining
Retiring Shares being offered to other Eligible Stockholders which are not
accepted by such other Eligible Stockholders (such acceptance being
hereinafter referred to as an "Additional Retiring Purchase"). If the
number of Remaining Retiring Shares that the Eligible Stockholders elect to
purchase in their Initial Retiring Purchases and Additional Retiring
Purchases exceeds the number of Remaining Retiring Shares, the number of
Remaining Retiring Shares to be purchased in the aggregate by all Second
Priority Eligible Stockholders shall be reduced to the extent of the Excess
Attributable to the Second Priority Additional Retiring Purchases with such
reduction in the number of Remaining Retiring Shares to be purchased in the
aggregate by all Second Priority Eligible Stockholders to be allocated
among such Second Priority Eligible Stockholders in proportion to the
number of Remaining Retiring Shares each Second Priority Eligible
Stockholder has agreed to purchase in such Second Priority Eligible
Stockholder's Additional Retiring Purchase (the "First Retirement
Reduction"). If any excess remains after the First Retirement Reduction,
the number of Remaining Retiring Shares to be purchased in the aggregate by
all Second Priority Eligible Stockholders shall be further reduced to the
extent of the Excess Attributable to the Second Priority Initial Retiring
Purchases with such reduction in the number of Remaining Retiring Shares to
be purchased in the aggregate by all Second Priority Eligible Stockholders
to be allocated among such Second Priority Eligible Stockholders in
proportion to the number of Remaining Retiring Shares each Second Priority
Eligible Stockholder has agreed to purchase in such Second Priority
Eligible Stockholder's Initial Retiring Purchase (the "Second Retirement
Reduction"). If any excess remains after the Second Retirement Reduction,
the number of Remaining Retiring Shares to be purchased in the aggregate by
all First Priority Eligible Stockholders shall be reduced to the extent of
the Excess Attributable to the First Priority Additional Retiring Purchases
with such reduction in the number of Remaining Retiring Shares to be
purchased in the aggregate by all First Priority Eligible Stockholders to
be allocated among such First Priority Eligible Stockholders in proportion
to the number of Remaining Retiring Shares each First Priority Eligible
Stockholder has agreed to purchase in such First Priority Eligible
Stockholder's Additional Retiring Purchase. To the extent possible, any
mechanical problems shall be solved in any equitable manner determined by
the Board to be consistent with the intent of the parties hereto.
(b) The price per share for Retiring Shares shall be the Valuation
Price per Share as in effect on the date of the Primary Retirement Notice
or, in the event that the Corporation does not deliver a Primary Retirement
Notice, as in effect on the date of the Secondary Retirement Notice (the
"Notice Date").
(c) Upon the occurrence of any Termination Event (except for a
Termination Event described in Section 14(d)(i)(5) or Section 14(d)(ii)(5)
with respect to a Stockholder who is a Manager Stockholder or a DGHA
Stockholder, in each case occurring on or prior to the fifth anniversary of
the Original Agreement Date (or at any time with respect to a Termination
Event described in Section 14(d)(i)(1) or (2) or Section 14(d)(ii)(1) or
(2)), such Stockholder or his or her designated beneficiaries, as the
29
case may be, shall be entitled to require, subject to the provisions of the
next sentence, by written notice delivered to the Corporation within 60
days of such Termination Event, that the Corporation (or, at the election
of the Corporation, the Corporation's designee) repurchase for cash not
less than all Securities (other than Class C Restricted Shares) then held
by such Stockholder prior to such Termination Event (the "Individual
Investor Put Shares") at a price per share equal to the Valuation Price per
Share as of the date of such Termination Event. The Corporation's
repurchase obligation described in the foregoing sentence shall be in all
cases subject to any applicable restrictions provided by the Delaware
General Corporation Law, the Certificate and any applicable restrictions
and conditions set out in the Debt Documents.
(d) As used in this Section 14, a "Termination Event" shall have
occurred if:
(i) a Manager Stockholder's employment with the Corporation or
any Subsidiary thereof is terminated (and not continued, or
substantially simultaneously resumed, with the Corporation or any
Subsidiary thereof) as a result of:
(1) the death of such Manager Stockholder;
(2) the permanent disability (as determined by the
Board or the Board of Directors of such Subsidiary, as the
case may be, in good faith) of such Manager Stockholder;
(3) the retirement at or above age 65 (or such other
age as may be determined by the Compensation Committee) of
such Manager Stockholder;
(4) termination by the Corporation or any such
Subsidiary of such Manager Stockholder for any reason other
than for Cause; or
(5) such Manager Stockholder notifies the Corporation
or any such Subsidiary that he is terminating his
employment, or the Corporation or any such Subsidiary
notifies such Manager Stockholder that the employment of
such Manager Stockholder is being terminated for Cause.
(ii) a DGHA Stockholder's employment with DGHA or any Affiliate
thereof is terminated (and not continued, or substantially
simultaneously resumed, with DGHA or any Affiliate thereof) as a
result of:
(1) the death of such DGHA Stockholder;
(2) the permanent disability (as determined by the
Board or the Board of Directors of such Affiliate, as the
case may be, in good faith) of such DGHA Stockholder;
30
(3) the retirement at or above age 70 (or such other
age as may be determined by the Compensation Committee) of
such DGHA Stockholder;
(4) termination by DGHA or any Affiliate thereof of
such DGHA Stockholder for any reason other than for Cause;
or
(5) such DGHA Stockholder notifies DGHA or any
Affiliate thereof that he is terminating his employment, or
DGHA or any Affiliate thereof notifies such DGHA Stockholder
that the employment of such DGHA Stockholder is being
terminated for Cause.
(e) Any repurchase by the Corporation or purchase by an Eligible
Stockholder of the Individual Investor Put Shares or the Retiring Shares,
as the case may be, pursuant to this Section 14 shall be effected by
delivery by the Stockholder or his beneficiaries, as the case may be, of
the certificate(s) for all such Retiring Shares of Individual Investor Put
Shares (properly endorsed for transfer) to the appropriate transferee(s) on
a date five (5) business days after the requisite notice or notices
pursuant to this Section 14 requiring the repurchase or purchase of all
such Retiring Shares or Individual Investor Put Shares, as the case may be,
have been given (the "Transfer Date"). As of the Transfer Date, title to
such Retiring Shares or Individual Investor Put Shares shall be deemed
transferred to the respective transferee(s) upon tender by such
transferee(s) of the purchase price for such Retiring Shares or Individual
Investor Put Shares to the Stockholder or his designated beneficiaries by a
check or checks in New York Clearing House funds or by a wire transfer to
the account of the Stockholder or his designated beneficiaries.
(f) Notwithstanding anything to the contrary contained in this
Section 14, the Corporation and the Retiring Stockholder (in the case of a
repurchase contemplated by Section 14(a)) or the Corporation and the
Manager Stockholder or DGHA Stockholder or his or her designated
beneficiaries (in the case of a repurchase contemplated by (Section 14(c)),
as the case may be, shall have the right and option to elect (the "Deferral
Election"), pursuant to a written agreement duly executed by such persons,
to deem the date of the relevant Termination Event to be deferred for
purposes of this Section 14 until a date (the "Deferral Date") not more
than six years following the date of the Deferral Election. A Deferral
Election must be made within 90 days of the occurrence of the relevant
Termination Event. A Deferral Election shall be effective solely to defer
for purposes of this Section 14 the date of a Termination Event until the
Deferral Date specified in, or determined pursuant to, such Deferral
Election (at which time Sections 14(a) and 14(c) shall be applicable
according to their respective terms) and such Deferral Election shall not
otherwise affect the rights or obligations of any party hereto.
SECTION 15. Required Sale.
-------------
Notwithstanding anything contained herein to the contrary if, at any
time on or after the fourth anniversary of the Original Agreement Date, an IRR
Event shall not have occurred, the Majority of the Institutional Stockholders
shall have the right, at any time, to serve
31
written notice on the Corporation of the desire of the Majority of the
Institutional Stockholders to effect a Sale of the Company. The DGHA
Stockholders shall have the exclusive right for a period of 180 days (the
"Exclusive Period"), commencing on the date of the determination of "Fair Value"
(as hereinafter defined) to consummate either a Sale of the Company at Fair
Value or the acquisition of the Institutional Securities, at a price equal to
what the Institutional Stockholders would receive for the Institutional
Securities if a Sale of the Company was consummated at Fair Value after giving
effect to the provisions of the DGHA Repurchase Agreement and the Manager
Repurchase Agreement. "Fair Value" means the highest price that would be paid
for all or substantially all of (i) the Securities, (ii) the capital stock of a
Subsidiary, (iii) the assets of the Corporation (after the assumption of all of
the liabilities of the Corporation), or (iv) the assets of a Subsidiary (after
the assumption of all the liabilities of such Subsidiary), as the case may be,
and in each case, on a going-concern basis in a single arm's-length transaction
between a willing buyer and a willing seller in an orderly process, using
valuation techniques then prevailing in the securities industry and assuming
full disclosure of all relevant information and a reasonable period of time for
effectuating such sale, as determined jointly by the Majority of the
Institutional Stockholders and the Majority of the DGHA Stockholders. If such
parties are unable to reach agreement within 30 days, such Fair Value shall be
determined by an independent nationally recognized investment bank experienced
in valuing companies or assets jointly selected by the Majority of the
Institutional Stockholders and the Majority of the DGHA Stockholders. If the
parties cannot agree on the selection of an investment bank within 30 days, the
investment bank will be selected by an independent arbitrator appointed in
accordance with the rules of the American Arbitration Association. The
determination of such investment bank shall be final and binding upon the
parties, and the Corporation shall pay the fees and expenses of such investment
bank.
SECTION 16. Regulatory Matters.
------------------
(a) Regulatory Compliance Cooperation.
---------------------------------
(i) If a Stockholder determines that it has a Regulatory
Problem, the Corporation agrees to take all such actions as are
reasonably requested by such Stockholder (x) to effectuate and
facilitate any Transfer by such Stockholder of any Securities (as
defined below) of the Corporation then held by such Stockholder to any
Person designated by such Stockholder, (y) to permit such Stockholder
(or any Affiliate of such Stockholder) to exchange all or any portion
of the voting Securities then held by such Person on a share-for-share
basis for shares of a class of nonvoting Securities of the
Corporation, which nonvoting Securities shall be identical in all
respects to such voting Securities, except that such new Securities
shall be nonvoting and shall be convertible into voting Securities on
such terms as are requested by such Stockholder in light of regulatory
considerations then prevailing, and (z) to continue and preserve the
respective allocation of the voting interests with respect to the
Corporation provided for in the Certificate and this Agreement and
with respect to such Stockholder's ownership of the Corporation's
voting Securities. Such actions may include, without limitation, (x)
entering into such additional agreements as are reasonably requested
by such Stockholder to permit any Person(s) designated by such
Stockholder to exercise any voting power which is relinquished by such
32
Stockholder upon any exchange of voting Securities for nonvoting
Securities of the Corporation; and (y) entering into such additional
agreements, adopting such amendments to this Agreement, the
Certificate and the Bylaws of the Corporation and taking such
additional actions as are reasonably requested by such Stockholder in
order to effectuate the intent of the foregoing; provided, however
that such actions will not change materially any of the agreements,
rights or obligations of the parties reflected herein or in the
Certificate or the Bylaws.
(ii) Before the Corporation redeems, purchases or otherwise
acquires, directly or indirectly, or converts or takes any action with
respect to the voting rights of, any Securities, the Corporation shall
give written notice of such pending action to each Stockholder. Upon
the written request of any Stockholder made within 10 days after its
receipt of such notice stating that after giving effect to such action
such Stockholder would have a Voting Regulatory Problem, the
Corporation shall defer taking such action for such period (not to
extend beyond 45 days after such Stockholder's receipt of the
Corporation's original notice) as such Stockholder requests to permit
it and its Affiliates to reduce the quantity of Securities they own or
take other appropriate action in order to avoid the Voting Regulatory
Problem. In addition, in the event that the Corporation shall be a
party to any merger, consolidation, recapitalization or other
transaction pursuant to which any Stockholder would be required to
take any voting Securities, or any Securities convertible into, or
exchangeable or exercisable for, voting Securities, which might
reasonably be expected to cause such Stockholder to have a Voting
Regulatory Problem, then the Corporation shall not be a party to such
transaction unless such Stockholder shall receive non-voting
Securities.
(b) Cooperation of Other Stockholders. Each Stockholder agrees to
---------------------------------
cooperate with the Corporation in complying with Section 16(a) above,
including without limitation, voting to approve amending the Certificate,
this Agreement or the Bylaws in a manner reasonably requested by the
Stockholder requesting such amendment.
(c) Covenant Not to Amend. The Corporation and each Stockholder
---------------------
agree not to amend or waive the voting or other provisions of the
Certificate, this Agreement or the Bylaws if such amendment or waiver would
cause any Stockholder to have a Voting Regulatory Problem, provided that
any such Stockholder notifies the Corporation that it would have a Voting
Regulatory Problem promptly after it has notice of such amendment or
waiver.
SECTION 17. Requisite Stockholder Approval.
------------------------------
Each Stockholder agrees to consider in good faith any proposal or
proposals made by the Corporation for a Stockholder vote (with or without a
meeting), or for a Stockholder or Stockholders to take any other action or
actions, that the Corporation deems reasonably advisable in connection with
achieving a Requisite Stockholder Approval. The Corporation shall make one or
more proposals for a Stockholder vote (with or without a meeting), or for a
Stockholder or Stockholders to take any other action or actions, that the
Corporation deems reasonably advisable in connection with achieving a Requisite
Stockholder Approval.
33
SECTION 18. Amendment and Waiver.
--------------------
(a) Except as expressly set forth herein, the provisions of this
Agreement may only be amended or waived with the prior written consent of
the Corporation, a Majority of the Institutional Stockholders and a
Majority of the DGHA Stockholders; provided, however, that Schedule 1 to
this Agreement shall be deemed to be automatically amended from time to
time to reflect issuances and Transfers of Securities made in accordance
with the terms hereof without requiring the consent of any party, and the
Corporation will, upon request, distribute to any Stockholder a revised
Schedule 1 to reflect any such changes.
(b) No course of dealing between the Corporation, its Subsidiaries
and the Stockholders (or any of them) or any delay in exercising any rights
hereunder will operate as a waiver of any rights of any party to this
Agreement.
(c) For purposes of this Agreement, shares of capital stock held
by the Corporation or any Subsidiaries will not be deemed to be
outstanding.
(d) 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.
SECTION 19. Securities Law Compliance; Legends.
----------------------------------
(a) Restriction on Transfer. No Stockholder shall Transfer
-----------------------
Restricted Securities except in compliance with the conditions specified in
this Agreement or pursuant to a Public Sale.
(b) Restrictive Legends. Each certificate for the Restricted
-------------------
Securities shall (unless otherwise provided by the provisions of Section
19(d)) be stamped or otherwise imprinted with a legend in substantially the
following terms:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE BEEN
ACQUIRED FOR INVESTMENT AND HAVE NOT BEEN REGISTERED UNDER
THE UNITED STATES SECURITIES ACT OF 1933 OR ANY STATE
SECURITIES OR BLUE SKY LAWS. THESE SECURITIES MAY NOT BE
SOLD OR TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR
AN EXEMPTION THEREFROM UNDER SAID ACT OR LAWS.
(c) Notice of Transfer. The holder of any Restricted Securities,
------------------
by its acceptance or purchase thereof, agrees, prior to any Transfer of any
such Restricted Securities (except pursuant to an effective registration
statement), to give written notice to the Corporation of such holder's
intention to effect such Transfer and agrees to comply in all other
respects with the provisions of this Section 19. Each such notice shall
describe the manner and circumstances of the proposed Transfer and, unless
waived by the Corporation, shall be accompanied by the written opinion,
addressed to the
34
Corporation, of counsel for the holder of such Restricted Securities (which
counsel shall be reasonably satisfactory to the Corporation), stating that
in the opinion of such counsel (which opinion shall be reasonably
satisfactory to the Corporation) such proposed Transfer does not involve a
transaction requiring registration or qualification of such Restricted
Securities under the Securities Act or the securities laws of any state of
the United States. Subject to complying with the other applicable
provisions hereof, such holder of Restricted Securities shall be entitled
to consummate such Transfer in accordance with the terms of the notice
delivered by it to the Corporation if the Corporation does not object (on
the basis that such Transfer violates the provisions of this Section 19) to
such Transfer within five days after the delivery of such notice. Each
certificate or other instrument evidencing the securities issued upon the
Transfer of any Restricted Securities (and each certificate or other
instrument evidencing any untransferred balance of such Securities) shall
bear the legend set forth in Section 19(b) unless (i) in such opinion of
such counsel registration of future Transfer is not required by the
applicable provisions of the Securities Act or the securities laws of any
state of the United States or (ii) the Corporation shall have waived the
requirement of such legend.
(d) Removal of Legends, Etc. Notwithstanding the foregoing
-----------------------
provisions of this Section 19, the restriction imposed by Sections 19(a),
(b) and (c) upon the transferability of any Restricted Securities shall
cease and terminate when (i) any such Restricted Securities are sold or
otherwise disposed of in accordance with the intended method of disposition
by the seller or sellers thereof set forth in a registration statement or
are sold or otherwise disposed of in a transaction contemplated by Section
19(c) which does not require that the securities transferred bear the
legend set forth in Section 19(b), or (ii) the holder of such Restricted
Securities has met the requirement of transfer of such Restricted
Securities pursuant to subparagraph (k) of Rule 144. Whenever the
restrictions imposed by Sections 19(a), (b) and (c) shall terminate, as
herein provided, the holder of any Restricted Securities shall be entitled
to receive from the Corporation, without expense, a new certificate not
bearing the restrictive legend set forth in Section 19(b) and not
containing any other reference to the restrictions imposed by Sections
19(a), (b) and (c).
(e) Additional Legend. Each certificate evidencing Securities
-----------------
and each certificate issued in exchange for or upon the Transfer of any
Securities (if such shares remain Securities as defined herein after such
Transfer) shall be stamped or otherwise imprinted with a legend in
substantially the following form:
"THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE ALSO
SUBJECT TO A STOCKHOLDERS AGREEMENT DATED AS OF FEBRUARY 9,
1996 AMONG THE ISSUER OF SUCH SECURITIES (THE "COMPANY") AND
CERTAIN OF THE COMPANY'S STOCKHOLDERS. THE TERMS OF SUCH
STOCKHOLDERS AGREEMENT INCLUDE, AMONG OTHER THINGS, VOTING
AGREEMENTS, REPURCHASE AGREEMENTS AND RESTRICTIONS ON
TRANSFERS. A COPY OF SUCH STOCKHOLDERS AGREEMENT WILL BE
FURNISHED WITHOUT
35
CHARGE BY THE COMPANY TO THE HOLDER HEREOF UPON WRITTEN
REQUEST."
The Corporation shall imprint such legends on certificates evidencing shares
outstanding prior to the date hereof. The legend set forth above shall be
removed from the certificates evidencing any shares which cease to be Securities
in accordance with the terms of this Agreement.
SECTION 20. Duration of Agreement.
---------------------
The rights and obligations of each Stockholder under this Agreement
shall terminate as to such Stockholder upon the earliest to occur of (a) the
Transfer of all Securities owned by such Stockholder and (b) the consummation of
an IRR Event.
SECTION 21. 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 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, and such invalid, void or
otherwise unenforceable provisions shall be null and void. It is the intent of
the parties, however, that any invalid, void or otherwise unenforceable
provisions be automatically replaced by other provisions which are as similar as
possible in terms to such invalid, void or otherwise unenforceable provisions
but are valid and enforceable to the fullest extent permitted by law.
SECTION 22. Entire Agreement.
----------------
This document embodies the complete agreement and understanding among
the parties hereto with respect to the subject matter hereof 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.
SECTION 23. Certain Stockholders.
--------------------
If any Stockholder is an entity that was formed for the purpose of
acquiring Securities or that has no substantial assets other than Securities or
interests in Securities, such Stockholder agrees that (a) shares of its common
stock or other instruments reflecting equity interests in such entity (and the
shares of common stock or other equity interests in any similar entities
controlling such entity) will note the restrictions contained in this Agreement
on the transfer of Securities as if such common stock or other equity interests
were Securities and (b) no shares of such common stock or other equity interests
may be transferred to any Person other than in accordance with the terms and
provisions of this Agreement as if such common stock or other equity interests
were Securities.
SECTION 24. Successors and Assigns.
----------------------
Except as otherwise provided herein, this Agreement will bind and
inure to the benefit of and be enforceable by the Corporation and its successors
and assigns and the
36
Stockholders and any subsequent holders of Securities and the respective
successors and permitted assigns of each of them, so long as they hold
Securities. None of the provisions hereof shall create, or be construed or
deemed to create, any right to employment in favor of any Person by the
Corporation or any of its Subsidiaries. This Agreement is not intended to create
any third party beneficiaries.
SECTION 25. Counterparts.
------------
This Agreement may be executed simultaneously in two or more
counterparts, any one of which need not contain the signatures of more than one
party, but all such counterparts taken together will constitute one and the same
agreement. It shall not be necessary in making proof of this Agreement to
produce or account for more than one such counterpart.
SECTION 26. Remedies.
--------
(a) Each Stockholder shall have all rights and remedies reserved for
such Stockholder pursuant to this Agreement, the Subscription Agreement
dated the Original Agreement Date, the Certificate and Bylaws and all
rights and remedies which such holder has been granted at any time under
any other agreement or contract and all of the rights which such holder has
under any law or equity. Any Person having any rights under any provision
of this Agreement will be entitled to enforce such rights specifically, to
recover damages by reason of any breach of any provision of this Agreement
and to exercise all other rights granted by law or equity.
(b) The parties hereto agree that if any parties seek to resolve any
dispute arising under this Agreement pursuant to a legal proceeding, the
prevailing parties to such proceeding shall be entitled to receive
reasonable fees and expenses (including reasonable attorneys' fees and
expenses) incurred in connection with such proceedings.
(c) It is acknowledged that it will be impossible to measure in
money the damages that would be suffered if the parties fail to comply with
any of the obligations herein imposed on them and that in the event of any
such failure, an aggrieved Person will be irreparably damaged and will not
have an adequate remedy at law. Any such person shall, therefore, be
entitled to injunctive relief, including specific performance, to enforce
such obligations, and if any action should be brought in equity to enforce
any of the provisions of this Agreement, none of the parties hereto shall
raise the defense that there is an adequate remedy at law.
SECTION 27. Notices.
-------
All notices, demands or other communications to be given or delivered
under or by reason of the provisions of this Agreement shall be in writing and
shall be deemed to have been given (a) when delivered personally to the
recipient, (b) one business day after being sent by reputable overnight courier
(charges prepaid) (regardless of whether the recipient refuses to accept
delivery), (c) five business days after being sent to the recipient by certified
or registered mail, return receipt requested and postage prepaid (regardless of
whether the recipient refuses to accept delivery) or (d) when sent to the
recipient by facsimile (followed promptly by personal, courier or certified or
registered mail delivery). The Corporation's address is:
37
USS Holdings, Inc.
c/o D. Xxxxxx Xxxxxx & Associates, Inc.
000 Xxxx Xxxxxx
00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telephone: (000) 000-0000
Telecopier: (000) 000-0000
Attention: Xxxxxx X. Xxxxxxxxxx
With a copy to:
Winthrop, Stimson, Xxxxxx & Xxxxxxx
Xxx Xxxxxxx Xxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telephone: (000) 000-0000
Telecopier: (000) 000-0000
Attention: Xxxxxxx X. Xxxxxxxxx, Esq.
The address for each Stockholder is set forth on Schedule 1 hereto;
and if to CMC, with a copy to:
X'Xxxxxxxx Graev & Karabell, LLP
00 Xxxxxxxxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telephone: (000) 000-0000
Telecopier: (000) 000-0000
Attention: Xxxx X. Xxxxxx, Esq.
SECTION 28. Governing Law.
-------------
All questions concerning the construction, interpretation and validity
of this Agreement shall be governed by and construed in accordance with the
domestic laws of the State of New York without giving effect to any choice or
conflict of law provision or rule (whether in the State of New York or any other
jurisdiction) that would cause the application of the laws of any jurisdiction
other than the State of New York.
SECTION 29. Further Assurances.
------------------
Each party hereto shall do and perform or cause to be done and
performed all such further acts and things and shall execute and deliver all
such other agreements, certificates, instruments, and documents as any other
party hereto reasonably may request in order to carry out the provisions of this
Agreement and the consummation of the transactions contemplated hereby.
38
SECTION 30. Jurisdiction; Venue; Process.
----------------------------
The parties to this Agreement agree that jurisdiction and venue in any
action brought by any party hereto pursuant to this Agreement shall properly
(but not exclusively) lie in any federal or state court located in the State of
New York. By execution and delivery of this Agreement, the parties hereto
irrevocably submit to the jurisdiction of such courts for himself and in respect
of his property with respect to such action. The parties hereto irrevocably
agree that venue would be proper in such court, and hereby waive any objection
that such court is an improper or inconvenient forum for the resolution of such
action. The parties further agree that the mailing by certified or registered
mail, return receipt requested, of any process required by any such court shall
constitute valid and lawful service of process against them, without necessity
for service by any other means provided by statute or rule of court.
SECTION 31. Representation and Warranties of the Stockholders.
-------------------------------------------------
Each Stockholder (as to himself or itself only) represents and
warrants to the Corporation and the other Stockholders that, as of the time such
Stockholder becomes a party to this Agreement:
(a) this Agreement has been duly and validly executed and delivered
by such Stockholder and this Agreement constitutes a legal and binding
obligation of such Stockholder, enforceable against such Stockholder in
accordance with its terms;
(b) the execution, delivery and performance by such Stockholder of
this Agreement and the consummation by such Stockholder of the transactions
contemplated hereby will not, with or without the giving of notice or lapse
of time, or both (i) violate any provision of law, statute, rule or
regulation to which the Stockholder is subject, (ii) violate any order,
judgment or decree applicable to such Stockholder, or (iii) conflict with,
or result in a breach or default under, any term or condition of any
agreement or other instrument to which such Stockholder is a party or by
which such Stockholder is bound, except for such violations, conflicts,
breaches or defaults that would not, in the aggregate, materially affect
the Stockholder's ability to perform its obligations hereunder;
(c) the Stockholder purchased the Securities owned by it for its own
account, for investment and not with a view to the distribution thereof
within the meaning of the Securities Act;
(d) the Stockholder understands that the Securities have not been
registered under the Securities Act or registered or qualified under
applicable state securities laws by reason of their issuance by the
Corporation in a transaction exempt from the registration and qualification
requirements of the Securities Act and applicable state securities laws,
and (ii) the Securities must be held by the Stockholder indefinitely unless
a subsequent disposition thereof is registered or qualified under the
Securities Act and applicable state securities laws or is exempt from such
registration or qualification. The Stockholder understands that the
certificates for the Securities will bear the legends described in Section
19(b) and (e);
39
(e) the Stockholder further understands that, with respect to the
Securities, the exemption from registration afforded by Rule 144 (the
provisions of which are known to the Stockholder) depends on the
satisfaction of various conditions, and that, if applicable, Rule 144 may
only afford the basis for sales only in limited amounts;
(f) the Stockholder has not employed any broker or finder or similar
person in connection with its purchase of the Securities;
(g) except as disclosed in writing to the Corporation prior to the
acquisition of Securities by such Stockholder, the Stockholder is an
"accredited investor" (as defined in Rule 501(a) of Regulation D
promulgated under the Securities Act). The Corporation has made available
to the Stockholder or its representatives all agreements, documents,
records and books that the Stockholder has requested relating to an
investment in the Securities. The Stockholder has had an opportunity to
ask questions of, and receive answers from, Persons acting on behalf of the
Corporation concerning the terms and conditions of this investment, and
answers have been provided to all of such questions to the full
satisfaction of the Stockholder. No oral representations have been made or
furnished to, or relied on by, the Stockholder or its representatives in
connection with its investment in the Securities. The Stockholder has such
knowledge and experience in financial and business matters that it is
capable of evaluating the risks and merits of its investment in the
Securities;
(h) the Stockholder has no need for liquidity in its investment in
the Securities and is able to bear the economic risk of its investment in
the Securities and the complete loss of all of such investment;
(i) the Stockholder further understands that this Agreement is made
with the Stockholder in reliance upon the Stockholder's representations to
the Corporation contained in this Section 31; and
(j) the Stockholder and its representatives have conducted a due
diligence investigation and have had the opportunity to review all
documents and information which the Stockholder and its representatives
have requested concerning Silica, the Corporation, the Subsidiaries and the
Stockholder's investment. In reaching its decision to invest in the
Corporation, the Stockholder has relied on the foregoing investigation and
information, on the representations and warranties in the Stock Purchase
Agreement and on the representations and warranties set forth herein.
SECTION 32. Conflicting Agreements.
----------------------
No Stockholder shall enter into any stockholder agreements or
arrangements of any kind with any Person with respect to any Securities on terms
inconsistent with the provisions of this Agreement (whether or not such
agreements or arrangements are with other Stockholders or with Persons that are
not parties to this Agreement), including but not limited to, agreements or
arrangements with respect to the acquisition or disposition of Securities of the
Corporation in a manner which is inconsistent with this Agreement.
40
SECTION 33. Mutual Waiver of Jury Trial.
---------------------------
BECAUSE DISPUTES ARISING IN CONNECTION WITH COMPLEX FINANCIAL
TRANSACTIONS ARE MOST QUICKLY AND ECONOMICALLY RESOLVED BY AN EXPERIENCED AND
EXPERT PERSON AND THE PARTIES WISH APPLICABLE STATE AND FEDERAL LAWS TO APPLY
(RATHER THAN ARBITRATION RULES), THE PARTIES DESIRE THAT THEIR DISPUTES BE
RESOLVED BY A JUDGE APPLYING SUCH APPLICABLE LAWS. THEREFORE, TO ACHIEVE THE
BEST COMBINATION OF THE BENEFITS OF THE JUDICIAL SYSTEM AND OF ARBITRATION, THE
PARTIES HERETO WAIVE ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, SUIT OR
PROCEEDING BROUGHT TO ENFORCE OR DEFEND ANY RIGHTS OR REMEDIES UNDER THIS
AGREEMENT OR ANY DOCUMENTS RELATED HERETO.
* * * * *
41
IN WITNESS WHEREOF, the undersigned have duly executed this Amendment
No. 2 as of the date first written above.
USS HOLDINGS, INC.
By: /s/ Xxxxxx X. Xxxxxxxxxx
----------------------------------
Name:
Title:
CHASE MANHATTAN CAPITAL, L.P.
By: Chase Manhattan Capital Corporation,
its general partner
By: /s/ Xxxxxx X. Xxxxxxx
-----------------------------
Name: Xxxxxx X. Xxxxxxx
Title: General Partner
CHASE VENTURE CAPITAL
ASSOCIATES, L.P.
By: Chase Capital Partners,
its general partner
By: /s/ Xxxxxx X. Xxxxxxx
-----------------------------
Name: Xxxxxx X. Xxxxxxx
Title: General Partner
MASSACHUSETTS MUTUAL LIFE INSURANCE COMPANY
By: __________________________________
Name:
Title:
42
MASSMUTUAL PARTICIPATION INVESTORS
By: __________________________________
Name:
Title:
MASSMUTUAL CORPORATE INVESTORS
By: __________________________________
Name:
Title:
XXXXXXX & CO.
By: __________________________________
Name:
Title:
/s/ D. Xxxxxx Xxxxxx
--------------------------------------
D. Xxxxxx Xxxxxx
/s/ Xxxxxxx X. Xxxxxxxxxx
--------------------------------------
Xxxxxxx X. Xxxxxxxxxx
/s/ Xxxxxxx X. Xxxxxxx
--------------------------------------
Xxxxxxx X. Xxxxxxx
/s/ Xxxxxx X. Xxxxxxxxxx
--------------------------------------
Xxxxxx X. Xxxxxxxxxx
______________________________________
Xxxxx Xxxxxxxx
/s/ Xxxxxxx X. Xxxx
--------------------------------------
Xxxxxxx X. Nick
43
______________________________________
Xxxxxxx X. Xxxxxx
______________________________________
Xxxxxxx X. Xx Xxxxxx
______________________________________
Xxxxxxx X. Xxxx
______________________________________
Xxxxxxx X. Xxxxx
______________________________________
Xxxxx XxXxxxxxx
______________________________________
Xxxxxx X. Xxxxx
______________________________________
Xxxxx Xxxxx
______________________________________
Xxxxx X. Day
______________________________________
Xxxxxx Xxxxxxxxxx
______________________________________
Xxxxx Xxxxxx
______________________________________
Xxx Xxxxxxxx
______________________________________
Xxxxx Xxxxxxxx
______________________________________
Xxxxxxxx X. Xxxxxxx, Xx.
44
___________________________________________
Xxxxx F.X. Xxxxxx
___________________________________________
Xxxxxx X. Xxxxxxxxxxx
___________________________________________
Xxxxxx X. Xxxxxx
___________________________________________
Xxxxxxx X. Xxxx
___________________________________________
Xxxxxxx Xxxxxxxxx
___________________________________________
Xxxxxxx X. Xxxxxx
___________________________________________
Xxxxxxx X. Xxxxx, Xx.
___________________________________________
Xxxxxxx X. Xxxxxxxx
___________________________________________
Xxxxx X. Xxxxxxx
___________________________________________
Xxxxxxx X. Fell
___________________________________________
Xxxxx X. Xxxxxxx
___________________________________________
Xxxxxx Xxxx
___________________________________________
Xxxxxx X. Xxxxxx
45
___________________________________________
Xxxxx X. Xxxxxx
___________________________________________
Xxxx X. Xxxxxx
___________________________________________
Xxxxxxxx Xxxxx
___________________________________________
Xxxxx X. Xxxxxx
___________________________________________
Xxxxxxx X. Xxxxx
___________________________________________
Xxxx X. Xxxxx
___________________________________________
Xxxxxx X. Xxxxxx
___________________________________________
Xxxxx X. Pullio
___________________________________________
M. Xxx Xxxxx
___________________________________________
Xxxxxx X. Xxxxxxxx
___________________________________________
Xxxxx X. Xxxxxx
___________________________________________
Xxxx X. Xxxxx
___________________________________________
Xxxx X. Xxxxxxxx
46
___________________________________________
Xxx X. Xxxxxxxx
___________________________________________
Xxxxxxx X. Xxxxx
___________________________________________
Xxxxxx X. Xxxxxx
___________________________________________
Xxxxx X. Xxxxxxx
___________________________________________
Xxxxxxx X. XxXxxxx
___________________________________________
Xxxxxx X. Xxxxxx
___________________________________________
Xxxx X. XxXxxxxx
___________________________________________
Xxxxxxx X. Xxxxx
___________________________________________
Xxxxxxx X. Xxxxxxx
___________________________________________
Xxxxx X. Xxxx
___________________________________________
Cyrus X. Xxxxxxx, Xx.
___________________________________________
Xxxxxx X. Xxxxxx
___________________________________________
Xxxxxxxx X. Xxxxx
47
___________________________________________
Xxxxx X. Xxxxxxxxx
___________________________________________
Xxxx X. Xxxxxx
___________________________________________
Xxxx X. Xxxxxxx
___________________________________________
Xxx Xxx Xxxxxxx, Xx.
___________________________________________
Xxxxxxx X. Xxxxxx
___________________________________________
Xxxxxx X. Xxxxxxxx
___________________________________________
Xxxx X. Xxxxxx
___________________________________________
Xxxxx X. Xxxxxxx
___________________________________________
H. Xxxxxxx Xxxxxxx
___________________________________________
Xxxxxx X. Xxxx
___________________________________________
Xxxx X. Xxxxx
___________________________________________
Xxxxxx X. Xxxxxxxxx
___________________________________________
Xxxxx X. Xxxxxxxx
48
___________________________________________
Xxxxxxx X. Xxxxxxx
___________________________________________
Xxxx X. Xxxxxxxx
___________________________________________
Xxxxxx X. Xxxxxxxx
___________________________________________
Xxxxxx X. Xxxxxxx
___________________________________________
Xxxx X. Xxxxxx
___________________________________________
Xxxxx X. Xxxxxx
___________________________________________
Xxxxxx X. Xxxxxx
___________________________________________
Xxxxxx X. Xxxxxx
___________________________________________
Xxxx X. Xxxxxxxx
___________________________________________
Xxxxx X. Xxxxxx
___________________________________________
Xxxxx X. Xxxxxxxxxxx
___________________________________________
Xxxx X. Xxxxxx
___________________________________________
Xxxxx X. Xxxx
49
___________________________________________
Xxxxx X. Xxxxxxxxx
___________________________________________
Xxxx X. Xxxxxxxx
___________________________________________
Xxx X. Xxxxxxx
___________________________________________
Xxxxxxx X. Xxxxxxx
___________________________________________
Xxxxxxx X. Xxxxxxxx
___________________________________________
Xxxxxxx X. Xxxxxxx
Trust under Agreement of D. Xxxxxx Xxxxxx
dated November 18, 1994
F/B/O Xxxxxx Xxxxxx
By /s/ Xxxxxxx X. Xxxxxxxxxx
----------------------------------------
Xxxxxxx X. Xxxxxxxxxx, Trustee
By /s/ Xxxxxx X. Xxxxxxxxxx
----------------------------------------
Xxxxxx X. Xxxxxxxxxx, Trustee
Trust under Agreement of D. Xxxxxx Xxxxxx
dated November 18, 1994
F/B/O Xxxxxxxx Xxxxxx
By /s/ Xxxxxxx X. Xxxxxxxxxx
----------------------------------------
Xxxxxxx X. Xxxxxxxxxx, Trustee
By /s/ Xxxxxx X. Xxxxxxxxxx
----------------------------------------
Xxxxxx X. Xxxxxxxxxx, Trustee
50
Trust under Agreement of D. Xxxxxx Xxxxxx
dated November 18, 1994
F/B/O Xxxxx Xxxxxxx
By /s/ Xxxxxxx X. Xxxxxxxxxx
----------------------------------------
Xxxxxxx X. Xxxxxxxxxx, Trustee
By /s/ Xxxxxx X. Xxxxxxxxxx
----------------------------------------
Xxxxxx X. Xxxxxxxxxx, Trustee
Trust under Agreement of D. Xxxxxx Xxxxxx
dated November 18, 1994
F/B/O Xxxxx Xxxxxxx
By /s/ Xxxxxxx X. Xxxxxxxxxx
----------------------------------------
Xxxxxxx X. Xxxxxxxxxx, Trustee
By /s/ Xxxxxx X. Xxxxxxxxxx
----------------------------------------
Xxxxxx X. Xxxxxxxxxx, Trustee
Trust under Agreement of D. Xxxxxx Xxxxxx
dated November 18, 1994
F/B/O Augustus Northridge
By /s/ Xxxxxxx X. Xxxxxxxxxx
----------------------------------------
Xxxxxxx X. Xxxxxxxxxx, Trustee
By /s/ Xxxxxx X. Xxxxxxxxxx
----------------------------------------
Xxxxxx X. Xxxxxxxxxx, Trustee
51
Trust under Agreement of D. Xxxxxx Xxxxxx
dated January 31, 1995
F/B/O P.G.F. Scurr
By /s/ Xxxxxxx X. Xxxxxxxxxx
----------------------------------------
Xxxxxxx X. Xxxxxxxxxx, Trustee
By /s/ Xxxxxx X. Xxxxxxxxxx
----------------------------------------
Xxxxxx X. Xxxxxxxxxx, Trustee
Trust under Agreement of Xxxxxxx X.
Xxxxxxxxxx dated October 29, 1990
By /s/ D. Xxxxxx Xxxxxx
----------------------------------------
D. Xxxxxx Xxxxxx, Trustee
By ________________________________________
Xxxxxxx X. Xxxxxxx, Trustee
Trust under Agreement of Xxxxxx X.
Xxxxxxxxxx dated December 16, 1993
F/B/O Xxxxxx X. Xxxxxxxxxx
By /s/ Xxxxxx X. Xxxxxxxxxx
----------------------------------------
Xxxxxx X. Xxxxxxxxxx, Trustee
By /s/ Xxxxxxx X. Xxxxxxxxxx
----------------------------------------
Xxxxxxx X. Xxxxxxxxxx, Trustee
52
Trust under Agreement of Xxxxxx X. Xxxxxxxxxx
dated December 16, 1993
F/B/O Xxxxxxx X. Xxxxxxxxxx
By /s/ Xxxxxx X. Xxxxxxxxxx
----------------------------------------
Xxxxxx X. Xxxxxxxxxx, Trustee
By /s/ Xxxxxxx X. Xxxxxxxxxx
----------------------------------------
Xxxxxxx X. Xxxxxxxxxx, Trustee
Trust under Agreement of Xxxxxx X. Xxxxxxxxxx
dated December 16, 1993
F/B/O Xxxxxxxx X. Xxxxxxxxxx
By /s/ Xxxxxx X. Xxxxxxxxxx
----------------------------------------
Xxxxxx X. Xxxxxxxxxx, Trustee
By /s/ Xxxxxxx X. Xxxxxxxxxx
----------------------------------------
Xxxxxxx X. Xxxxxxxxxx, Trustee
Trust under Agreement of Xxxxxx X. Xxxxxxxxxx
dated December 16, 1993
F/B/O Xxxxxx X. Xxxxxxxxxx
By /s/ Xxxxxx X. Xxxxxxxxxx
----------------------------------------
Xxxxxx X. Xxxxxxxxxx, Trustee
By /s/ Xxxxxxx X. Xxxxxxxxxx
----------------------------------------
Xxxxxxx X. Xxxxxxxxxx, Trustee
53
Schedule 1
Chase Manhattan Capital, X.X. Xxxxx Venture Capital Massachusetts Mutual Life
c/o Chase Manhattan Capital Associates, L.P. Insurance Company
Corporation c/o Chase Capital Partners c/o Xx. Xxxx Xxxxx
000 Xxxxxxx Xxxxxx, 00xx Floor 000 Xxxxxxx Xxxxxx, 00xx Floor Managing Director
Xxx Xxxx, XX 00000 Xxx Xxxx, XX 00000 Securities Investment Division
Mass Mutual
0000 Xxxxx Xxxxxx
Xxxxxxxxxxx, XX 00000-0000
MassMutual Participation Mass Mutual Corporate Investors D. Xxxxxx Xxxxxx
Investors c/o Xx. Xxxx Xxxxx D. Xxxxxx Xxxxxx & Associates, Inc.
c/o Xx. Xxxx Xxxxx Managing Director 000 Xxxx Xxxxxx, 00xx floor
Managing Director Securities Investment Division Xxx Xxxx, XX 00000
Securities Investment Division Mass Mutual
Mass Mutual 0000 Xxxxx Xxxxxx
0000 Xxxxx Xxxxxx Xxxxxxxxxxx, XX 00000-0000
Xxxxxxxxxxx, XX 00000-0000
Xxxxxxx X. Xxxxxxxxxx Xxxxxxx X. Xxxxxxx Xxxxxx X. Xxxxxxxxxx
D. Xxxxxx Xxxxxx & Associates, Inc. D. Xxxxxx Xxxxxx & Associates, Inc. D. Xxxxxx Xxxxxx & Associates, Inc.
000 Xxxx Xxxxxx, 00xx floor 000 Xxxx Xxxxxx, 00xx floor 000 Xxxx Xxxxxx, 00xx xxxxx
Xxx Xxxx, XX 00000 Xxx Xxxx, XX 00000 Xxx Xxxx, XX 00000
Xxxxxxx X. Nick Xxxxxxx X. Xxxxxx Xxxxxxx X. XxXxxxxx
D. Xxxxxx Xxxxxx & Associates, Inc. 0000 Xxxx 000xx Xxxxxx 00000 Xxxxx
000 Xxxx Xxxxxx, 00xx xxxxx Xxxxxxxx Xxxx, XX 00000 Xxxxxxxx Xxxx, XX 00000
Xxx Xxxx, XX 00000
Xxxxxxx X. Xxxx Xxxxx Xxxxxxxx Xxxxxx X. Xxxxx
D. Xxxxxx Xxxxxx & Associates, Inc. 0 Xxxxx Xxxx 00000 Xxxxxx Dr.
000 Xxxx Xxxxxx, 00xx xxxxx Xxxxxxxxxx Xxxxxxx, XX 00000
Xxx Xxxx, XX 00000 Xxxxxx X0 0XX
Xxxxxx Xxxxxxx
Xxxxx X. Xxxxx Xxxxx X. Xxx Xxxxxx X. Xxxxxxxxxx
0000 Xxxx 000xx Xx. 0000 X. 000xx Xx. 00000 Xxxxxxxxxx
Xxxxxxxx Xxxx, XX 00000 Xxxxxxxx Xxxx, XX 00000 Xxxxxxxx Xxxx, XX 00000
Xxxxx Xxxxxx Xxx X. Xxxxxxxx Xxxxx X. Xxxxxxxx
00000 Xxxxx Xx. 2147 West 5025 South 00000 Xxx
Xxxxxxxx Xxxx, XX 00000 Xxx, XX 00000 Xxxxxxxx Xxxx, XX 00000
Xxxxx Xxxxxx Xxxxxxxx X. Xxxxxxx Xxxxx XxXxxxxxx
000 Xxxxx Xxxxxxxx Xxx 0000 Xxxx 000xx Xx. 00 Xxxxxx Xxxxx
Xxxxxxxxx, XX 00000 Xxxxxxxx Xxxx, XX 00000 Xx. Xxxx'x Xxxx
Xxxxxx, XX0 0-X
Xxxxxx Xxxxxxx
Xxxxxx X. Xxxxxxxxxxx Xxxxxxx X. Xxxxx Trust under Agreement of X. Xxxxxx
00000 Xxxx 000xx Xxxxx 00000 Xxxxxxxx Xxxx Xxxxxx dated November 18, 0000
Xxxxxxxx Xxxx, XX 00000 Xxxxxx, XX 00000 F/B/O Xxxxxx Xxxxxx
c/o D. Xxxxxx Xxxxxx & Associates, Inc.
000 Xxxx Xxxxxx, 00xx xxxxx
Xxx Xxxx, XX 00000
Trust under Agreement of X. Xxxxxx Trust under Agreement of X. Xxxxxx Trust under Agreement of D. Xxxxxx
Xxxxxx dated November 18, 1994 Xxxxxx dated November 18, 1994 Xxxxxx dated November 18, 1994
F/B/O Xxxxxxxx Xxxxxx F/B/O Xxxxx Xxxxxxx F/B/O Xxxxx Xxxxxxx
c/o D. Xxxxxx Xxxxxx & Associates, Inc. c/o D. Xxxxxx Xxxxxx & Associates, Inc. c/o D. Xxxxxx Xxxxxx & Associates, Inc.
000 Xxxx Xxxxxx, 00xx floor 000 Xxxx Xxxxxx, 00xx floor 000 Xxxx Xxxxxx, 00xx xxxxx
Xxx Xxxx, XX 00000 Xxx Xxxx, XX 00000 Xxx Xxxx, XX 00000
Trust under Agreement of X. Xxxxxx Trust under Agreement of X. Xxxxxx Trust under Agreement of Xxxxxxx
Xxxxxx dated November 18, 1994 Xxxxxx dated January 31, 1995 X. Xxxxxxxxxx dated October 29, 1990
F/B/O Augustus Northridge F/B/O P.G.F. Scurr c/o D. Xxxxxx Xxxxxx & Associates, Inc.
c/o D. Xxxxxx Xxxxxx & Associates, Inc. c/o D. Xxxxxx Xxxxxx & Associates, Inc. 000 Xxxx Xxxxxx, 00xx floor
000 Xxxx Xxxxxx, 00xx floor 000 Xxxx Xxxxxx, 00xx xxxxx Xxx Xxxx, XX 00000
Xxx Xxxx, XX 00000 Xxx Xxxx, XX 00000
Trust under Agreement of Xxxxxx X. Trust under Agreement Xxxxxx X. Trust under Agreement of Xxxxxx X.
Xxxxxxxxxx dated December 16, 0000 Xxxxxxxxxx dated December 16, 0000 Xxxxxxxxxx dated December 16, 1993
F/B/O Xxxxxx X. Xxxxxxxxxx F/B/O Xxxxxxx X. Xxxxxxxxxx F/B/O Xxxxxxxx X. Xxxxxxxxxx
c/o D. Xxxxxx Xxxxxx & Associates, Inc. c/o D. Xxxxxx Xxxxxx & Associates, Inc. c/o D. Xxxxxx Xxxxxx & Associates, Inc.
000 Xxxx Xxxxxx, 00xx floor 000 Xxxx Xxxxxx, 00xx floor 000 Xxxx Xxxxxx, 00xx xxxxx
Xxx Xxxx, XX 00000 Xxx Xxxx, XX 00000 Xxx Xxxx, XX 00000
Trust under Agreement of Xxxxxx X.
Xxxxxxxxxx dated December 16, 1993
F/B/O Xxxxxxx X. Xxxxxxxxxx
c/o D. Xxxxxx Xxxxxx & Associates, Inc.
000 Xxxx Xxxxxx, 00xx xxxxx
Xxx Xxxx, XX 00000
Xxxxxx X. Xxxxxxx Xxxxx X. Xxxxxxx Xxxxx X. Xxxxxx
000 Xxxxxx Xxxxx 00000 Xxxxx Xxxx Xxxx 0000 Xxxxxxxx Xxxx.
Xxxxxxxxx, XX 00000 Xxxxxxxxxxxx, XX 00000 Xxxxxxxxxx, XX 00000
2
Xxxxxx X. Xxxxxx Xxxxx X. Xxxx H. Xxxxxxx Xxxxxxx
93 Hickory Hill 0000 Xxxx 0Xx Xxxx 000 Xxxxxxx Xxxxxx
Xxxxxx, XX 00000 Xxxxxxx, XX 00000 Xxxxx Xxxxxxxx, XX 00000
Xxxx X. Xxxxxxxx Xxxxx X. Xxxxxxxx M. Xxx Xxxxx
00000 Xxxxxxxx Xxxxx 000 X. Xxxxxxxx Xxxxxx 000 Xxx X'Xxx
Xxxxxxxxxx, XX 00000 Xxxxxxxxxxx, XX 00000 Xxxxxxxxx, XX 00000
Xxxxxx X. Xxxxxxxx Xxxxxx X. Xxxxxx Xxxxxx X. Xxxxxxxx
0000 Xxxxxxxxxxxx Xxxx 00000 Xxxxxx Xxxxx Xxxx P. O. Xxx 000
Xxxxxxxxxx, XX 00000 Xxxx Xxxxx, XX 00000 Xxxxxxxx Xxxxxxx, XX 00000
Xxxxxxx X. Xxxxxxx Xxxxxxx X. Fell Xxxxxxx X. Xxxxxx
000 Xxxxxxxxxxx Xxxxx 0000 Xxxxxxxxx Xxxxx 00000 Xxxxxxxxx Xxxx
Xxxxxxxxxx, XX 00000 Xxxxxxxxxx, XX 00000 Xxxxxxxxxx, XX 00000Xxxx
Xxxx X. Xxxxxx Xxxxxx X. Xxxxxx Xxxxx X. Xxxxxxx
00000 Xxxxx Xxxxxx 0000 Xxxxxxxxxxx Xxxxx Xxxxx 0, Xxx 00
Xxxxxxxxxx, XX 00000 Xxxxxxxxxxx, XX 00000 Xxxxxxxxxxx, XX 00000-0000
Xxxxxx X. Xxxxxxxxx Xxxxxxx X. Xxxxxxx Xxxx X. Xxxxxxxx
000 Xxxxxxxx Xxxx Xxxxx 5, Box 000 Xxxxx 0, Xxx 000X
Xxxxxx, XX 00000 Xxxxxxxxxxx, XX 00000 Xxxxxxxxxxx, XX 00000
Xxxx X. Xxxxxx Xxxxx X. Xxxxxx Xxxxxxx Xxxxxxxxx
000 Xxxxxxx Xxxxx Xxxx 217 Green Acre Circle 00000 Xxxxxxxx Xxxx
Xxxxxx, XX 00000 Xxxxxxxxx, XX 00000 Clear Xxxxxx, XX 00000
Xxxxxxx X. Xxxx Xxxx X. Xxxxx Xxxxx X. Xxxxxxx
0000 Xxxxxxxx Xxxxx Xxxxx 3, Box 53 00000 Xxxxxxx Xxxx XX
Xxxxx Xxxxxxxx, XX 00000 Xxxxxxxx, XX 00000 Xxxxxx Xxxxxxx, XX 00000
Xxxxx X. Xxxxxxxxxxx Cyrus X. Xxxxxxx, Xx. Xxxxxx X. Xxxxxx
0000 Xxxxx Xxxx Xx#x 0 Xxxxxxxx Xxxx 00 Xxxxxxxxxxx Xxxxxx
Xxxxxx, XX 00000 Xxxxxxx, XX 00000 Xxxxxx, XX 00000
Xxxxxxx X. XxXxxxx Xxxxxxxx Xxxxx Xxxx X. Xxxxx
000 0/0 Xxxx Xxxxxxxx Xxxxxx 000 Xxxxxxxx Xxxx 00 X. Xxxxx Xxxxxx, Xxx. 00X
Xxxxxx, XX 00000 Xxxx, XX 00000 Xxxxxxxxx, XX 00000
Xxxxxxx X. Xxxxx Xxxxxx Xxxx Xxxxx X. Xxxxxx
000 Xxxxxxx Xxxxx 00 Xxxxx Xxxx Xxxxxxx 000 Xxxxxxxxx Xxxxx
Xxxxxxxxxx, XX 00000 Xxxxxxxx Xxxxxxx, XX 00000 Xxxxxxxx, XX 00000
3
Xxxx X. Xxxxx Xxxxxxx X. Xxxxxxx Xxxx X. XxXxxxxx
000 Xxxxxx Xxxxx 0000 X. Xxxxx Xxxxxx 000 X. Xxxxxxx
Xxxxxxxx Xxxxxxx, XX 00000 Xxxxxxxx, XX 00000 Xxxxxx, XX 00000
Xxxxxx X. Xxxxxx Xxxx X. Xxxxxx Xxxxxx X. Xxxxxx
0 Xxxxxxx Xxxx 00000 Xxxxxxxx Xxxxx Xxxxx 1, Box 242 Honeywood
Xxxxxxxxxx Xxxxxxxx, XX 00000 Xxxxxxxxxx, XX 00000 Xxxxxxxxxxx, XX 00000
Xxxxxx X. Xxxx Xxxxxx X. Xxxxxxx Xxxxx X. Pullio
Xx. 0, Xxx 0000 0000 X. Xxxxxxx Xxxxxx 802 E. Yeagua
Xxxxxxxxxx, XX 00000 Xxxxxxxxxxx, XX 00000 Xxxxxxxxx, XX 00000
Xxxx X. Xxxxxxxx Xxxxxxxx X. Xxxxx Xxxxx X. Xxxx
0000 Xxxxxx Xxxx 434 Alverston Court 0000 Xxxxx Xxxxxx
Xxxxxxx, XX 00000 Xxxxxxx, XX 00000 Xxxxx, XX 00000
Xxxxxxx X. Xxxxxx Xxxxxx X. Xxxxxx Xxx X. Xxxxxxxx
Xxxxx 0, Xxx 000 X 00000 Xxxxx Xxxxx 0000 Xxxxx Xxxx
Xxxxxxxxxxx, XX 00000 Xxxxxxxxxx, XX 00000 Xxxxxxx, XX 00000
Xxxxx X. Xxxxxxxxx Xxxxxxx X. Xxxxx, Xx. Xxxxxxx X. Xxxxxxxx
00 Xxxxxxxx Xxxxx Xxxxx 0, Xxx 00000 Xxxxx 2, Box 156
Groton, CT 06340 Xxxxxxxx Xxxxxxx, XX 00000 Xxxxxxxx Xxxxxxx, XX 00000
Xxxxxxx X. Xxxxxxxx Xxxx X. Xxxxxxxx Xxxx X. Xxxxxx
000 Xxxxxxxxxx Xxxxx 5211 Powers Ferry Road 00000 Xxx Xxxxxxx Xxxxxx
Xxxxxxxxxx, XX 00000 Xxxxxxx, XX 00000 Xxxxxxxxxx, XX 00000
Xxxxx X. Xxxxxxx Xxx Xxx Xxxxxxx, Xx. Xxxxx X. Xxxxxx
0000 Xxxxxxx Xxxxx Xx 0, Xxx 0 0000 Xxxxxxxx Xxxx
Xxxxxx, XX 00000 Xxxxxxxxxx, XX 00000 Xxxxxxxxx, XX 00000
Xxxxx X. Xxxxxx Xxx X. Xxxxxxx Xxxxxxx X. Xxxxx
0000 Xxxxxxxxxx Xxxxx 000 Xxxxxxx Xxxxxxx Drive 0000 Xxxxxxx Xxxx
Xxxxxxxxxxx, XX 00000 Xxxxxxxxx, XX 00000 Xxxxxxxxxxx, XX 00000
Xxxxx X. Xxxxxxxxx Xxxxxx X. Xxxxxxx Xxxx X. Xxxxxx
0000 Xxxxxx Xxxx 75 Xxxxxxx Xxxxx Rd. 135 00 Xxxxxxxx Xxxxxx Xxxx
Xxx, XX 00000 Berkeley Springs, X 00000 Xxxxxxxxxx, XX 00000
Xxxxxxx X. Xxxxx Xxxx X. Xxxxxxx Xxxxxxx X. Xxxxxxx
263 Hyatt 00000 Xxxxxx Xxxx Xxxxx 0, Xxx 0000
Xxxxxx, XX 00000 Xxxxxxxxxx, XX 00000 Xxxxxxxx Xxxxxxx, XX 00000
4
Schedule 2
Accounting Period Budgeted EBITDA
----------------- ---------------
Fiscal Year Ending December 31, 1998 $31,715
Fiscal Year Ending December 31, 1999 $36,695
Fiscal Year Ending December 31, 2000 $40,642
Fiscal Year Ending December 31, 2001 $43,130
Fiscal Year Ending December 31, 2002 $45,400
Schedule 3
[Form of Restated Certificate]
Schedule 4
DGHA Stockholders
D. Xxxxxx Xxxxxx
Xxxxxxx X. Xxxxxxxxxx
Xxxxxxx X. Xxxxxxx
Xxxxxx X. Xxxxxxxxxx
Xxxxxxx X. Xxxx
Schedule 5
Non-Affiliated Stockholders
Xxxxxxx X. Xxxxx
Xxxxx XxXxxxxxx
Xxxxxx X. Xxxxx
Xxxxx Xxxxx
Xxxxx X. Day
Xxxxxx Xxxxxxxxxx
Xxxxx Xxxxxx
Max Xxxxxxxx
Xxxxx Xxxxxxxx
Xxxxx F. X. Xxxxxx
Xxxxxxxx X. Xxxxxxx, Xx.
Xxxxxx X. Xxxxxxxxxxx
Xxxxxxx X. Xxxxxx
Xxxxxxx X. XxXxxxxx
Xxxxxxx X. Xxxx
Xxxxx Xxxxxxxx
Schedule 6
Institutional Stockholders
Chase Manhattan Capital, X.X.
Xxxxx Venture Capital Associates, L.P.
Massachusetts Mutual Life Insurance Company
Massmutual Participation Investors
Massmutual Corporate Investors
Xxxxxxx & Co.
Schedule 7
Form of Manager Repurchase Agreement
Schedule 8
Manager Stockholders
Xxxxxx X. Xxxxxxx Xxxxx X. Xxxxxx
Xxxxx X. Xxxxxxx Xxxx X. Xxxxx
Xxxxx X. Xxxxx Xxxxxxx X. Xxxxxxx
Xxxxxx X. Xxxxxx Xxxx X. XxXxxxxx
Xxxxx X. Xxxx Xxxxxx X. Xxxxxx
H. Xxxxxxx Xxxxxxx Xxxx X. Xxxxxx
Xxxx X. Xxxxxxxx Xxxxxx X. Xxxxxx
Xxxxx X. Xxxxxxxx Xxxxxx X. Xxxx
X. Xxx Xxxxx Xxxxxx X. Xxxxxxx
Xxxxxx X. Xxxxxxxx Xxxxx X. Pullio
Xxxxxx X. Xxxxxx Xxxx X. Xxxxxxxx
Xxxxxx X. Xxxxxxxx Xxxxxxxx X. Xxxxx
Xxxxxxx X. Xxxxxxx Xxxxx X. Xxxx
Xxxxxxx X. Fell Xxxxxxx X. Xxxxxx
Xxxxxxx X. Xxxxxx Xxxxxx X. Xxxxxx
Xxxx X. Xxxxxx Xxxxxxx X. Xxxxxxx
Xxxxxx X. Xxxxxx Xxx X. Xxxxxxxx
Xxxxx X. Xxxxxxx Xxxxx X. Xxxxxxxxx
Xxxxxx X. Xxxxxxxxx Xxxxxxx X. Xxxxx, Xx.
Xxxxxxx X. Xxxxxxx Xxxxxxx X. Xxxxxxxx
Xxxx X. Xxxxxxxx Xxxxxxx X. Xxxxxxxx
Xxxx X. Xxxxxx Xxxx X. Xxxxxxxx
Xxxxx X. Xxxxxx Xxxx X. Xxxxxx
Xxxxxxx Xxxxxxxxx Xxxxx X. Xxxxxxx
Xxxxxxx X. Xxxx Xxx Xxx Xxxxxxx, Xx.
Xxxx X. Xxxxx Xxxxx X. Xxxxxx
Xxxxx X. Xxxxxxx Xxxxx X. Xxxxxx
Xxxxx X. Xxxxxxxxxxx Xxx X. Xxxxxxx
Cyrus X. Xxxxxxx, Xx. Xxxxxxx X. Xxxxx
Xxxxxx X. Xxxxxx Xxxxx X. Xxxxxxxxx
Xxxxxxx X. XxXxxxx Xxxxxx X. Xxxxxxx
Xxxxxxxx Xxxxx Xxxx X. Xxxxxx
Xxxx X. Xxxxx Xxxxxxx X. Xxxxx
Xxxxxxx X. Xxxxx Xxxx X. Xxxxxxx
Xxxxxx Xxxx
