STOCKHOLDERS AGREEMENT
Exhibit
3
Execution
Copy
STOCKHOLDERS
AGREEMENT (this “Agreement”) is made and
entered into as of March 8, 2010, by and between Xxxx X. Xxxxxxxxx (the “Stockholder”), and Kinderhook
Partners, L.P. (“Kinderhook”).
RECITALS
A.
WHEREAS, the Stockholder is, as of the date hereof, the beneficial holder of
15,642,858 shares of common stock of Liberator Medical Holdings, Inc., a Nevada
corporation (the “Company”), par value $.001 per
shares (the “Common
Stock”), which constitutes 45.97% of the Company’s outstanding Common
Stock;
B. WHEREAS,
Kinderhook is purchasing an aggregate of 4,666,667 shares (the “Kinderhook Shares”) of Common
Stock of the Company pursuant to that certain Securities Purchase Agreement
between Kinderhook and the Company, dated the date hereof (the “SPA”);
C. WHEREAS,
in connection with the consummation of the transactions contemplated by the SPA,
the Stockholder has agreed to provide for the future voting of his shares of the
Company’s Common Stock as set forth below.
NOW
THEREFORE, in consideration of Kinderhook entering into the SPA and the mutual
promises and covenants set forth herein, the parties hereto agree as
follows:
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1.
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Kinderhook
Director.
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1.1 Upon
the request of Kinderhook at any time during the term of this Agreement, the
Stockholder agrees to vote or to cause to be voted all of the Shares (as defined
below) now owned or hereafter acquired by such Stockholder or any of its
affiliates or which such Stockholder or any of its affiliates may be empowered
to vote from time to time and at all times in whatever manner as shall be
reasonably necessary (including, without limitation, voting to amend the
Company’s Certificate of Incorporation, if necessary, to increase the number of
directors) to ensure that a director selected at Kinderhook’s sole discretion
and request be elected to the Company’s board of directors (the “Kinderhook
Director”). Such Kinderhook Director shall be an additional
director to be added as a member of the board of directors as such board is then
currently constituted. It is understood and agreed that the initial
Kinderhook Director may be Xxxxxx Xxxx.
1.2 Removal. The
Stockholder shall not vote to remove the Kinderhook Director, other than for
Cause (as defined below). “Cause” shall mean (i) the Kinderhook
Director’s conviction of, or plea of nolo contendere, to a felony or crime
involving moral turpitude, (ii) if it is finally judicially determined by a
court of competent jurisdiction that the Kinderhook Director has violated his
fiduciary duties to the Company in any material respect, or (iii) if the person
serving as the Kinderhook Director would cause the Company to be in violation of
any law or regulation material to the Company. In any such situation,
Kinderhook will be entitled to select another person to be elected or appointed
to the Company’s Board of Directors in accordance with the terms of this
Agreement and the SPA.
1.3 Shares. “Shares” shall mean and include
any and all shares of Common Stock, Preferred Stock and any other shares of
capital stock of the Company, by whatever name called, which carry voting rights
(including without limitation voting rights which arise by reason of default)
and shall include any such shares now owned or subsequently acquired by the
Stockholder, however acquired, including without limitation stock splits and
stock dividends.
1.4 Vacancy. The
Stockholder agrees to vote all of his Shares from time to time and at all times
in whatever manner as shall be reasonably necessary to ensure that in the event
that a Kinderhook Director, for any reason, shall cease to serve as a member of
the Board of Directors during his or her term in office, the resulting vacancy
on the Board of Directors shall be filled in accordance with this
Agreement.
1.5 Further
Action. The Stockholder agrees to take such further actions as
shall be reasonably necessary to carry out the intent of this Agreement,
including, but not limited to, calling a special meeting of stockholders or
initiating or signing and delivering an action by written consent of the
stockholders for the purpose of adding, electing or removing a director as
contemplated hereby. The Stockholder shall vote all of his Shares entitled to
vote at such meeting or in connection with such consent in accordance with this
Agreement.
2. Specific
Enforcement. The parties acknowledge and agree that the
parties hereto would be irreparably damaged in the event any of the provisions
of this Agreement were not performed by the parties in accordance with their
specific terms or were otherwise breached. Accordingly, it is agreed
that the Stockholder and Kinderhook shall be entitled to an injunction to
prevent breaches of this Agreement and to specifically enforce this Agreement
and the terms and provisions hereof in any action instituted in any court of the
United States or any state thereof having subject matter jurisdiction, in
addition to any other remedy to which the parties may be entitled at law or in
equity.
3. Grant of Proxy. Should
the provisions of this Agreement be construed to constitute the granting of
proxies, such proxies shall be deemed coupled with an interest and are
irrevocable for the term of this Agreement.
(a)
4. Termination. This
Agreement and the rights and obligations of the parties hereunder shall
terminate and be of no further force or effect upon the earliest of (a) the
fourth (4th)
anniversary of the date of this Agreement and (b) such time as Kinderhook shall
no longer hold at least seventy-five percent (75%) of the Kinderhook
Shares. Notwithstanding the foregoing, Kinderhook may terminate its
rights under Section
1.1 in its discretion at any time upon notice to the
Company.
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5.
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Miscellaneous.
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5.1 Binding
Effect. This Agreement shall inure to the benefit of and shall
be binding upon the respective parties hereto and their respective successors
and permitted assigns. The Shares subject to this Agreement may be transferred
or assigned by the Stockholder; provided, however, that, if
such transfer or assignment is effected in a transaction other than a sale of
Shares by means of a broker transaction through an Eligible Market (as defined
in the SPA) or an underwritten public offering, then (i) Kinderhook must receive
written notice prior to the time of said transfer or assignment, stating the
name and address of said transferee or assignee, and (ii) such transferee or
assignee must agree to be bound by the terms and conditions of this
Agreement. The right and obligations of the Stockholder to vote its
Shares in accordance with this Agreement shall not be assignable other than to
an affiliate of, or an entity under common investment management with, the
Stockholder.
5.2 Further
Assurances. At any time or from time to time after the date hereof,
the parties agree to cooperate with each other, and at the request of any other
party, to execute and deliver any further instruments or documents and to take
all such further action as the other party may reasonably request in order to
evidence or effectuate the consummation of the transactions contemplated hereby
and to otherwise carry out the intent of the parties hereunder.
5.3 Governing
Law. THE CORPORATE LAWS OF THE STATE OF NEW YORK SHALL GOVERN
ALL ISSUES CONCERNING THE RELATIVE RIGHTS OF THE PARTIES HERETO, WITHOUT REGARD
TO ITS CONFLICTS OF LAW PROVISIONS. ALL QUESTIONS CONCERNING THE
CONSTRUCTION, VALIDITY, ENFORCEMENT AND INTERPRETATION OF THIS AGREEMENT SHALL
BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW
YORK. THE COMPANY, THE STOCKHOLDER AND KINDERHOOK HEREBY IRREVOCABLY
SUBMIT TO THE NON-EXCLUSIVE JURISDICTION OF THE STATE AND FEDERAL COURTS SITTING
IN THE CITY OF NEW YORK, BOROUGH OF MANHATTAN FOR THE ADJUDICATION OF ANY
DISPUTE BROUGHT BY THE COMPANY, THE STOCKHOLDER OR KINDERHOOK HEREUNDER, IN
CONNECTION HEREWITH OR WITH ANY TRANSACTION CONTEMPLATED HEREBY OR DISCUSSED
HEREIN (INCLUDING WITH RESPECT TO THE ENFORCEMENT OF ANY OF THE TRANSACTION
DOCUMENTS), AND HEREBY IRREVOCABLY WAIVE, AND AGREE NOT TO ASSERT IN ANY SUIT,
ACTION OR PROCEEDING BROUGHT BY THE COMPANY, THE STOCKHOLDER OR KINDERHOOK, ANY
CLAIM THAT IT IS NOT PERSONALLY SUBJECT TO THE JURISDICTION OF ANY SUCH COURT,
OR THAT SUCH SUIT, ACTION OR PROCEEDING IS IMPROPER. EACH PARTY
HEREBY IRREVOCABLY WAIVES PERSONAL SERVICE OF PROCESS AND CONSENTS TO PROCESS
BEING SERVED IN ANY SUCH SUIT, ACTION OR PROCEEDING BY MAILING A COPY THEREOF
VIA REGISTERED OR CERTIFIED MAIL OR OVERNIGHT DELIVERY (WITH EVIDENCE OF
DELIVERY) TO SUCH PARTY AT THE ADDRESS IN EFFECT FOR NOTICES TO IT UNDER THIS
AGREEMENT AND AGREES THAT SUCH SERVICE SHALL CONSTITUTE GOOD AND SUFFICIENT
SERVICE OF PROCESS AND NOTICE THEREOF. NOTHING CONTAINED HEREIN SHALL
BE DEEMED TO LIMIT IN ANY WAY ANY RIGHT TO SERVE PROCESS IN ANY MANNER PERMITTED
BY LAW. THE COMPANY, THE STOCKHOLDER AND KINDERHOOK HEREBY WAIVE ALL
RIGHTS TO A TRIAL BY JURY.
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5.4 Counterparts. This
Agreement may be executed in two or more counterparts, each of which shall be
deemed an original, but all of which together shall constitute one and the same
instrument. This Agreement may be signed by facsimile
signature.
5.5 Notices. Any
and all notices or other communications or deliveries required or permitted to
be provided hereunder shall be in writing and shall be deemed given and
effective on (a) the date of transmission, if such notice or communication is
delivered via facsimile or email prior to 6:30 p.m. EST (if such
transmission is delivered on or after 6:30 p.m. EST, then such transmission or
communication shall be deemed to be the business date immediately following such
transmission or communication), or (b) the business day immediately following
the date of deposit with a nationally recognized overnight courier
service. The addresses, facsimile numbers and email addresses for
such notices and communications are those set forth on the signature pages
hereof, or such other address or facsimile number as may be designated in
writing hereafter, in the same manner, by any such Person.
5.6 Severability. In
case any provision of this Agreement shall be invalid, illegal or unenforceable,
the validity, legality and enforceability of the remaining provisions shall not
in any way be affected or impaired thereby.
5.7 Costs of
Enforcement. If any party to this Agreement seeks to enforce
its rights under this Agreement by legal proceedings, the non-prevailing party
shall pay all costs and expenses reasonably incurred by the prevailing party,
including, without limitation, all reasonable attorney
fees. Notwithstanding the foregoing sentence, Kinderhook shall retain
its right to indemnification, contribution, enforcement and other remedies
pursuant to the terms of the SPA.
5.8 Entire
Agreement. This Agreement constitutes and contains the entire
agreement of the parties with regard to the subject matter hereof and supersedes
any and all prior negotiations, correspondence, understandings and agreements
between the parties regarding the subject matter hereof.
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5.9 Amendment. This
Agreement may be amended or terminated and the observance of any term of this
Agreement may be waived with respect to the parties to this Agreement (either
generally or in a particular instance and either retroactively or
prospectively), with the prior written consent of each of the Company, the
Stockholder and Kinderhook. The Company shall give prompt written
notice of any amendment or termination hereof or waiver hereunder to any party
or beneficiary hereto that did not consent in writing to such amendment,
termination or waiver. Any amendment, termination or waiver effected
in accordance with this Section 8.9 shall be
binding on all parties hereto. No waivers of or exceptions to any
term, condition or provision of this Agreement, in any one or more instances,
shall be deemed to be, or construed as, a further or continuing waiver of any
such term, condition or provision.
5.10 No Third-Party
Beneficiaries. This Agreement is intended for the benefit of
the parties hereto and their respective successors and permitted assigns and is
not for the benefit of, nor may any provision hereof be enforced by, any other
Person.
[SIGNATURE PAGES
FOLLOW]
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IN
WITNESS WHEREOF, the parties have executed this Agreement as of the day and year
first above written.
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STOCKHOLDER:
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Xxxx
X. Xxxxxxxxx
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Address for
Notice:
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Liberator
Medical Holdings, Inc.
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0000
XX Xxxx Xxxxxxx
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Xxxxxx,
XX 00000
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Telephone:
000-000-0000
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Facsimile
No.: (000) 000-0000
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Xxxx
X. Xxxxxxxxx, President
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With a copy
to:
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Siegel,
Lipman, Xxxxx, Xxxxxxx & Xxxxxx, XXX
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Xxx
Xxxxx, Xxxxx 000
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0000
Xxxx Xxxxxx Xxxx
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Xxxx
Xxxxx, XX 00000
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Tel:
000-000-0000
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Fax:
000-000-0000
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Email:
xxxxxxxx@xxxxxxx.xxx
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Attn:
Xxxxxxxx Xxxxxxx,
Esq.
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| KINDERHOOK PARTNERS, L.P. | |
| /s/ Xxxxxx Xxxx | |
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Name:
Xxxxxx Xxxx
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Title:
Associate
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Address for
Notice:
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Kinderhook
Partners, L.P.
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0
Xxxxxxxxx Xxxxx
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Xxxxx
000
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Xxxx
Xxx, XX 00000
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Attn:
Xxxxxx Xxxx
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Telephone:
(000) 000-0000
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Facsimile
No.: (000) 000-0000
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Email:
xxxxx@xxxxxxxxxxxxxxxxxx.xxx
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With a copy
to:
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Proskauer
Rose LLP
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0000
Xxxxxxxx
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Xxx
Xxxx, XX 00000
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Attn:
Xxxxxx Xxxxxxxx, Esq.
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Tel:
000-000-0000
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Email:
Xxxxxxxxx@xxxxxxxxx.xxx
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Signature
Page to Stockholder Agreement
