STOCKHOLDERS AGREEMENT
STOCKHOLDERS AGREEMENT dated ("Agreement") as of August 26,
1998 by and between Salton/Maxim Housewares, Inc., a Delaware
corporation ("Acquiror"), and the other parties signatory hereto
(each a "Stockholder").
RECITALS
Concurrently herewith, Acquiror, Salt Acquisition Corp., a
Missouri corporation ("Newco"), and Toastmaster Inc., a Missouri
corporation (the "Company"), are entering into an Agreement and
Plan of Merger of even date herewith (as such agreement may be
amended from time to time, the "Merger Agreement"; capitalized
terms used but not defined herein shall have the meanings set
forth in the Merger Agreement) pursuant to which (and subject to
the terms and conditions specified therein) Newco will be merged
with and into the Company (the "Merger"), whereby each share of
common stock, par value $.10 per share, of the Company ("Company
Common Stock") issued and outstanding immediately prior to the
Effective Time will be converted into the right to receive $7.00
cash, other than (i) shares of Company Common Stock owned,
directly or indirectly, by the Company or any subsidiary of the
Company or by Acquiror and (ii) Dissenting Shares.
As a condition to Acquiror's entering into the Merger
Agreement, Acquiror requires that each Stockholder enter into,
and each such Stockholder has agreed to enter into, this
Agreement with Acquiror.
AGREEMENT
To implement the foregoing and in consideration of the
mutual agreements contained herein, the parties hereby agree as
follows:
1. Representations and Warranties of Stockholders. Each
Stockholder hereby severally and not jointly represents and
warrants to Acquiror as follows:
(a) OWNERSHIP OF SHARES. (i) Such Stockholder is
either (i) the record holder or beneficial owner, either
alone or with such Stockholder's spouse, of the number of or
(ii) trustee of a trust that is the record holder or
beneficial owner of, and whose beneficiaries are the
beneficial owners (such trustee, a "Trustee") of shares of
Company Common Stock as is set forth opposite such
Stockholder's name on Schedule I hereto (such shares shall
constitute the "Existing Shares", and together with any
shares of Company Common Stock acquired of record or
beneficially by such Stockholder in any capacity after the
date hereof and prior to the termination hereof, whether
upon exercise of options, conversion of convertible
securities, purchase, exchange or otherwise, shall
constitute the "Shares").
(ii) On the date hereof, the Existing Shares
set forth opposite such Stockholder's name on Schedule
I hereto constitute all of the outstanding shares of
Company Common Stock owned of record or beneficially by
such Stockholder. Such Stockholder does not have
record or beneficial ownership of any Shares not set
forth on Schedule I hereto.
(iii) Such Stockholder has sole power, or
shared power with such Stockholder's spouse, of
disposition with respect to all of the Existing Shares
set forth opposite such Stockholder's name on
Schedule I and sole power, or shared power with such
Stockholder's spouse, to demand dissenter's or
appraisal rights, in each case with respect to all of
the Existing Shares set forth opposite such
Stockholder's name on Schedule I, with no restrictions
on such rights, subject to applicable federal
securities laws and the terms of this Agreement.
(b) POWER; BINDING AGREEMENT. Such Stockholder has
the legal capacity, power and authority to enter into and
perform all of such Stockholder's obligations under this
Agreement. The execution, delivery and performance of this
Agreement by such Stockholder will not violate any other
agreement to which such Stockholder is a party or by which
such Stockholder is bound including, without limitation, any
trust agreement, voting agreement, stockholders agreement,
voting trust, partnership or other agreement. This Agreement
has been duly and validly executed and delivered by such
Stockholder and constitutes a valid and binding agreement of
such Stockholder, enforceable against such Stockholder in
accordance with its terms. There is no beneficiary of or
holder of interest in any trust of which a Stockholder is
Trustee whose consent is required for the execution and
delivery of this Agreement or the consummation of the
transactions contemplated hereby. If such Stockholder is
married and such Stockholder's Shares constitute community
property, this Agreement has been duly authorized, executed
and delivered by, and constitutes a valid and binding
agreement of, such Stockholder's spouse, enforceable against
such person in accordance with its terms. The Stockholders
Agreement dated November 13, 1991, as amended on December
30, 1993 (as so amended, the "Existing Stockholders
Agreement"), has been amended so that the provisions of the
Existing Stockholders Agreement will not apply to the
Acquiror Option.
(c) NO CONFLICTS. Except for filings under the Xxxx-
Xxxxx-Xxxxxx Antitrust Improvements Act of 1976, as amended
(the "HSR Act"), if applicable, and the expiration or
termination of any applicable waiting period thereunder, (A)
no filing with, and no permit, authorization, consent or
approval of, any state or federal public body or authority
is necessary for the execution of this Agreement by such
Stockholder and the consummation by such Stockholder of the
transactions contemplated hereby and (B) neither the
execution and delivery of this Agreement by such Stockholder
nor the consummation by such Stockholder of the transactions
contemplated hereby nor compliance by such Stockholder with
any of the provisions hereof shall (x) conflict with or
result in any breach of any applicable trust, partnership
agreement or other agreements or organizational documents
applicable to such Stockholder, (y) result in a violation or
breach of, or constitute (with or without notice or lapse of
time or both) a default (or give rise to any third party
right of termination, cancellation, material modification or
acceleration) under any of the terms, conditions or
provisions of any note, bond, mortgage, indenture, license,
contract, commitment, arrangement, understanding, agreement
or other instrument or obligation of any kind to which such
Stockholder is a party or by which such Stockholder or any
of such Stockholder's properties or assets may be bound or
(z) violate any order, writ, injunction, decree, judgment,
statute, rule or regulation applicable to such Stockholder
or any of such Stockholder's properties or assets.
(d) Such Stockholder's Shares and the certificates
representing such Shares are now and at all times during the
term hereof will be held by such Stockholder, or by a
nominee or custodian for the benefit of such Stockholder,
free and clear of all liens, claims, security interests,
proxies, voting trusts or agreements, understandings or
arrangements or any other encumbrances whatsoever, except
for any such encumbrances or proxies arising hereunder.
(e) No broker, investment banker, financial adviser or
other person is entitled to any broker's, finder's,
financial adviser's or other similar fee or commission in
connection with the transactions contemplated hereby based
upon arrangements made by or on behalf of such Stockholder
in his or her capacity as such.
(f) Such Stockholder understands and acknowledges that
Acquiror is entering into the Merger Agreement in reliance
upon such Stockholder's execution and delivery of this
Agreement with Acquiror.
2. OPTION GRANTED TO ACQUIROR. (a) Each Stockholder,
severally and not jointly, hereby grants to Acquiror an
irrevocable option to purchase all, but not less than all, of
such Stockholder's Shares at any time prior to the termination of
the Merger Agreement in accordance with its terms, on the terms
and subject to the conditions set forth herein (collectively,
with respect to all the Stockholder's Shares, the "Acquiror
Option"), which Acquiror Option shall attach to each
Stockholder's Shares and be binding upon any person or entity to
which legal or beneficial ownership of such Shares shall pass,
whether by operation of law or otherwise, including without
limitation such Stockholder's heirs, guardians, administrators or
successors or as a result of any divorce.
(b) If Acquiror wishes to exercise the Acquiror
Option, Acquiror shall send a written notice to each
Stockholder of its election to exercise the Acquiror Option,
any time prior to the Closing, which exercise shall be
subject to the fulfillment of the conditions specified in
Section 2(e) hereof. The place and date of the closing of
the Acquiror Option ("Acquiror Option Closing") shall be the
same as the Closing, and the time of the Acquiror Option
Closing shall be immediately prior to the Closing.
(c) At the Acquiror Option Closing, each Stockholder
shall deliver to Acquiror all of such Stockholder's Shares
by delivery of a certificate or certificates evidencing such
Shares, duly endorsed to Acquiror or accompanied by stock
powers duly executed in favor of Acquiror, with all
necessary stock transfer stamps affixed (provided that the
cost of such transfer stamps is reimbursed by Acquiror).
(d) At the Acquiror Option Closing, Acquiror shall pay
to the Stockholders, by wire transfer in immediately
available funds to the account of such Stockholders
specified in writing no more than one business day prior to
the Acquiror Option Closing, an amount equal to the product
of $7.00 and the number of Shares purchased pursuant to the
exercise of the Acquiror Option.
(e) Each of the following conditions must be satisfied
at the time the Acquiror Option is exercised and at the time
of the Acquiror Option Closing:
(i) no court, arbitrator or governmental
body, agency or official shall have issued any order,
decree or ruling (which has not been stayed or
suspended pending appeal) and there shall not be any
effective statute, rule or regulation, restraining,
enjoining or prohibiting the consummation of the
purchase and sale of the Shares pursuant to the
exercise of the Acquiror Option;
(ii) any waiting period applicable to the
consummation of the purchase and sale of the Shares
pursuant to the exercise of the Acquiror Option under
the HSR Act shall have expired or been terminated; and
(iii) all of the conditions set forth in
Article VII of the Merger Agreement shall have been
satisfied or waived.
3. CERTAIN COVENANTS OF STOCKHOLDERS. Except in
accordance with the terms of this Agreement, each Stockholder
hereby severally covenants and agrees as follows:
3.1 NO SOLICITATION. Prior to the termination of the
Merger Agreement in accordance with its terms, no Stockholder
shall, in its capacity as such, directly or indirectly (including
through advisors, agents or other intermediaries), solicit
(including by way of furnishing information) or respond to any
inquiries or the making of any proposal by any person or entity
(other than Acquiror, Newco or any affiliate thereof) with
respect to the Company that constitutes or could reasonably be
expected to lead to an Acquisition Proposal (as defined in
Section 6.7 in the Merger Agreement), provided, however, that the
foregoing shall not restrict a Stockholder who is also a director
of the Company from taking actions in such Stockholder's capacity
as a director to the extent and in the circumstances permitted by
Section 6.7 of the Merger Agreement. If any Stockholder in its
capacity as such receives any such inquiry or proposal, then such
Stockholder shall promptly inform Acquiror of the terms and
conditions, if any, of such inquiry or proposal and the identity
of the person making it. Each Stockholder, in its capacity as
such, will immediately cease and cause to be terminated any
existing activities, discussions or negotiations with any parties
conducted heretofore with respect to any of the foregoing.
3.2 RESTRICTION ON TRANSFER, PROXIES AND
NONINTERFERENCE; RESTRICTION ON WITHDRAWAL. Prior to the
termination of the Merger Agreement in accordance with its terms,
no Stockholder shall, directly or indirectly: (i) except pursuant
to the terms of the Merger Agreement and to Acquiror pursuant to
this Agreement, offer for sale, sell, transfer, tender, pledge,
encumber, assign or otherwise dispose of, enforce or permit the
execution of the provisions of any redemption agreement with the
Company or enter into any contract, option or other arrangement
or understanding with respect to or consent to the offer for
sale, sale, transfer, tender, pledge, encumbrance, assignment or
other disposition of, or exercise any discretionary powers to
distribute, any or all of such Stockholder's Shares or any
interest therein, including any trust income or principal, except
in each case to a Permitted Transferee who is or agrees in a
writing executed by the Acquiror to become bound by this
Agreement; (ii) grant any proxies or powers of attorney with
respect to any Shares, deposit any Shares into a voting trust or
enter into a voting agreement with respect to any Shares; or
(iii) take any action that would make any representation or
warranty of such Stockholder contained herein untrue or incorrect
or have the effect of preventing or disabling such Stockholder
from performing such Stockholder's obligations under this
Agreement. For purposes of the Agreement, "Permitted
Transferees" means, with respect to a Stockholder, any of the
following persons: (a) the spouse of such Stockholder, provided
that at all relevant times of determination such Stockholder is
not separated or divorced from, or is not involved in separation
or divorce proceedings with, such spouse; (b) the issue of such
Stockholder; (c) any charitable foundation or similar
organization founded by such Stockholder; (d) a trust of which
there are no principal beneficiaries other than (i) such
Stockholder, (ii) such Stockholder's spouse (provided that at all
relevant times of determination such Stockholder is not separated
or divorced from, or is not involved in separation or divorce
proceedings with, such spouse), (iii) the issue of such
Stockholder, or (iv) any charitable foundation or similar
organization founded by such Stockholder; (e) the legal
representative of such Stockholder in the event such Stockholder
becomes mentally incompetent; and (f) the beneficiaries under (i)
the will of such Stockholder or the will of such Stockholder's
spouse, or (ii) a trust described in clause (d) above.
Notwithstanding anything herein to the contrary, Xxxxxx X. Xxxxxx
and/or Xxxxxxx X. Xxxxxx may donate in the aggregate up to
200,000 Shares to the University of Colorado Foundation and/or
the Xxxxxx X. and Xxxxxxx X. Xxxxxx Foundation, tax exempt
organizations.
3.3 WAIVER OF APPRAISAL AND DISSENTER'S RIGHTS. Each
Stockholder hereby waives any rights of appraisal or rights to
dissent from the Merger that such Stockholder may have. Each
Trustee represents that no beneficiary who is a beneficial owner
of Shares under any trust has any right of appraisal or right to
dissent from the Merger which has not been so waived.
3.4 NO TERMINATION OR CLOSURE OF TRUSTS. Unless, in
connection therewith, the Shares held by any trust which are
presently subject to the terms of this Agreement are transferred
upon termination to one or more Stockholders and remain subject
in all respects to the terms of this Agreement, or other
Permitted Transferees who upon receipt of such Shares become
signatories to this Agreement, the Stockholders who are Trustees
shall not take any action to terminate, close or liquidate any
such trust and shall take all steps necessary to maintain the
existence thereof at least until the termination of the Merger
Agreement in accordance with its terms.
4. FURTHER ASSURANCES. From time to time, at the other
party's request and without further consideration, each party
hereto shall execute and deliver such additional documents and
take all such further action as may be necessary or desirable to
consummate and make effective, in the most expeditious manner
practicable, the transactions contemplated by this Agreement.
5. CERTAIN EVENTS. Each Stockholder agrees that this
Agreement and the obligations hereunder shall attach to such
Stockholder's Shares and shall be binding upon any person or
entity to which legal or beneficial ownership of such Shares
shall pass, whether by operation of law or otherwise, including
without limitation such Stockholder's heirs, guardians,
administrators or successors or as a result of any divorce.
6. STOP TRANSFER. Each Stockholder agrees with, and
covenants to, Acquiror that such Stockholder shall not request
that the Company register the transfer (book-entry or otherwise)
of any certificate or uncertificated interest representing any of
such Stockholder's Shares, unless such transfer is made in
compliance with this Agreement.
7. TERMINATION. In the event the Merger Agreement is
terminated in accordance with its terms, the obligations set
forth in this Agreement shall also terminate.
8. MISCELLANEOUS.
8.1 Entire Agreement; Assignment. This Agreement,
together with the Merger Agreement (and the Exhibits and Schedule
thereto) and the Confidentiality Agreement (i) constitute the
entire agreement between the parties with respect to the subject
matter hereof and supersedes all other prior agreements and
understandings, both written and oral, between the parties with
respect to the subject matter hereof and (ii) shall not be
assigned by operation of law or otherwise without the prior
written consent of the other party.
8.2 AMENDMENTS. This Agreement may not be modified,
amended, altered or supplemented, except upon the execution and
delivery of a written agreement executed by the parties hereto;
provided that Schedule I may be supplemented by Acquiror by
adding the name and other relevant information concerning any
stockholder of the Company who is or agrees to be bound by the
terms of this Agreement without the agreement of any other party
hereto, and thereafter such added stockholder shall be treated as
a "Stockholder" for all purposes of this Agreement.
8.3 NOTICES. All notices and other communications
hereunder shall be in writing and shall be deemed to have been
duly given; as of the date of delivery, if delivered personally;
upon receipt of confirmation, if telecopied or upon the next
business day when delivered during normal business hours to an
overnight courier service, such as Federal Express, in each case
to the parties at the following addresses or at such other
addresses as shall be specified by the parties by like notice;
unless the sending party has knowledge that such notice or other
communication hereunder was not received by the intended
recipient:
If to the Stockholders:
Toastmaster Inc.
0000 Xxxxx Xxxxxxx Xxxxxxxxx
Xxxxxxxx, Xxxxxxxx 00000
Attention: Chairman
Telecopy: (000) 000-0000
with a copy to:
Xxxxxxx, Mag & Fizzell P.C.
0000 Xxxxxx Xxxxxx
Xxxxxx Xxxx, Xxxxxxxx 00000
Attention: Xxxx X. Xxxxxx
Telecopy: (000) 000-0000
If to Acquiror:
Salton/Maxim Housewares, Inc.
000 Xxxxxxxx Xxxxxx Xxxxx
Xxxxx Xxxxxxxx, Xxxxxxxx 00000
Attn: Chairman
Telecopy: (000) 000-0000
with a copy to:
Xxxxxxxxxxxx Xxxx & Xxxxxxxxx
0000 Xxxxx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Attn: Xxxx Xxxxxxxxxx, Esq.
Telecopy: (000) 000-0000
or to such other address as the person to whom notice is given
may have previously furnished to the others in writing in the
manner set forth above.
8.4 GOVERNING LAW. The validity, interpretation and
effect of this Agreement shall be governed exclusively by the
laws of the State of Missouri, without giving effect to the
principles of conflict of laws thereof.
8.5 ENFORCEMENT. The parties agree that irreparable
damage would occur in the event that any of the provisions of
this Agreement were not performed in accordance with their
specific terms or were otherwise breached. It is accordingly
agreed that the parties shall be entitled to an injunction or
injunctions to prevent breaches of this Agreement and to enforce
specifically the terms and provisions of this Agreement.
8.6 COUNTERPARTS. This Agreement may be executed in
two or more counterparts, each of which shall be deemed to be an
original, but both of which shall constitute one and the same
Agreement.
8.7 DESCRIPTIVE HEADINGS. The descriptive headings
used herein are inserted for convenience of reference only and
are not intended to be part of or to affect the meaning or
interpretation of this Agreement.
8.8 SEVERABILITY. If any term or provision of this
Agreement or the application thereof to any party or set of
circumstances shall, in any jurisdiction and to any extent, be
finally held invalid or unenforceable, such term or provision
shall only be ineffective as to such jurisdiction, and only to
the extent of such invalidity or unenforceability, without
invalidating or rendering unenforceable any other terms or
provisions of this Agreement under any other circumstances, and
the parties shall negotiate in good faith a substitute provision
which comes as close as possible to the invalidated or
unenforceable term or provision, and which puts each party in a
position as nearly comparable as possible to the position it
would have been in but for the finding of invalidity or
unenforceability, while remaining valid and enforceable.
8.9 DEFINITIONS; CONSTRUCTION. For purposes of this
Agreement:
(a) "Beneficially Own" or "Beneficial Ownership"
with respect to any securities shall mean having
"beneficial ownership" of such securities (as
determined pursuant to Rule 13d-3 under the Exchange
Act), including pursuant to any agreement, arrangement
or understanding, whether or not in writing. Without
duplicative counting of the same securities by the same
holder, securities Beneficially Owned by a Person shall
include securities Beneficially Owned by all other
Persons with whom such Person would constitute a
"group" as described in Section 13(d)(3) of the
Exchange Act.
(b) "Person" shall mean an individual,
corporation, partnership, joint venture, association,
trust, unincorporated organization or other entity.
(c) In the event of a stock dividend or
distribution, or any change in the Company Common Stock
by reason of any stock dividend, split-up,
recapitalization, combination, exchange of shares or
the like, the term "Shares" shall be deemed to refer to
and include the Shares as well as all such stock
dividends and distributions and any shares into which
or for which any or all of the Shares may be changed or
exchanged. In addition, in the event of any change in
the Company's capital stock by reason of stock
dividends, stock splits, mergers, consolidations,
recapitalizations, combinations, conversions, exchanges
of shares, extraordinary or liquidating dividends, or
other changes in the corporate or capital structure of
the Company which would have the effect of diluting or
changing the Acquiror's rights hereunder, the number
and kind of shares or securities subject to the Option
and the purchase price per Share (but not the total
purchase price) shall be appropriately and equitably
adjusted so that the Acquiror shall receive upon
exercise or the Acquiror Option the number and class of
shares or other securities or property that the
Acquiror would have received in respect of the Shares
purchasable upon exercise of the Acquiror Option if the
Acquiror Option had been exercised immediately prior to
such event. Each Stockholder shall take such steps in
connection with such consolidation, merger, liquidation
or other such action as may be necessary to assure that
the provisions hereof shall thereafter apply as nearly
as possible to any securities or property thereafter
deliverable upon exercise of the Acquiror Option.
8.10 STOCKHOLDER CAPACITY. Notwithstanding anything
herein to the contrary, no person executing this Agreement who
is, or becomes during the term hereof, a director of the Company
makes any agreement or understanding herein in his or her
capacity as such director, and the agreements set forth herein
shall in no way restrict any director in the exercise of his or
her fiduciary duties as a director of the Company. Each
Stockholder has executed this Agreement solely in his or her
capacity as the record or beneficial holder of such Stockholder's
Shares or as the trustee of a trust whose beneficiaries are the
beneficial owners of such Stockholder's Shares.
IN WITNESS WHEREOF, Acquiror and each Stockholder have
caused this Agreement to be duly executed as of the day and year
first above written.
/s/ Xxxx X. Xxxxxxxx SALTON/MAXIM HOUSEWARES, INC.
Xxxx X. Xxxxxxxx
/s/ Xxxxxx X. Xxxxxxxx By: /s/ Xxxxx Xxxxx
Xxxxxx X. Xxxxxxxx Name: Xxxxx Xxxxx
Title: Chairman
/s/ Xxxxxx X. Xxxxxx
Xxxxxx X. Xxxxxx
/s/ Xxxxxxx X. Xxxxxx
Xxxxxxx X. Xxxxxx
/s/ Xxxxxx X. Xxxxxxx
Xxxxxx X. Xxxxxxx
/s/ Xxxxxx X. Xxxxxxx
Xxxxxx X. Xxxxxxx
/s/ Xxxxxxx X. Xxxxxx
Xxxxxxx X. Xxxxxx, as Trustee
Under Indenture 73180 for the
benefit of Stephen R.H. Xxxxxx,
Xxxxxx S. G. Xxxxxx, Xxxxxxx X.
X. Xxxxxx and Xxxxx X. X. Xxxxxx
/s/ Xxxxxxx X. Xxxxxx
Xxxxxxx X. Xxxxxx, as Trustee
Under Agreement of Xxxxxx X.
Xxxxxx dated August 1, 1991
for the benefit of Xxxxxxxxx
X. Xxxxxx, Xxxxxx X. Xxxxxx,
Xxxx X. Xxxxxx, Xxxxxxxx X.
Xxxxxx, Xxxxxxx X. Xxxxxx and
Xxxxxx X. Xxxxxx
SCHEDULE I
Record Holder Number of Shares
Xxxx X. Xxxxxxxx 664,985*
Xxxxxx X. Xxxxxxxx, as custodian for children 26,880
Xxxxxx X. Xxxxxx 127,684
Xxxxxxx X. Xxxxxx 345,445
Xxxxxx X. Xxxxxxx 906,000
Xxxxxx X. Xxxxxxx, as trustee for children 126,271
Xxxxxxx X. Xxxxxx, as Trustee Under 477,046
Indenture 73180 for the benefit of
Stephen R.H. Xxxxxx, Xxxxxx S. G.
Xxxxxx, Xxxxxxx X. X. Xxxxxx and
Xxxxx X. X. Xxxxxx
Xxxxxxx X. Xxxxxx, as Trustee Under 389,418
Agreement of Xxxxxx X. Xxxxxx dated
August 1, 1991 for the benefit of
Xxxxxxxxx X. Xxxxxx, Xxxxxx X. Xxxxxx,
Xxxx X. Xxxxxx, Xxxxxxxx X. Xxxxxx,
Xxxxxxx X. Xxxxxx and Xxxxxx X. Xxxxxx
________________
* Includes 609,685 shares held in Xx. Xxxxxxxx'x recovable
trust.
