CONSENT AGREEMENT
Exhibit
10.2
This
Consent Agreement (the “Agreement”)
is
made and entered into as of March 29, 2007 between Contran Corporation, a
Delaware corporation (“Contran”),
and
Valhi, Inc., a Delaware corporation (“Valhi”).
Recitals
A. On
Xxxxx
00, 0000, Xxxxx issued to Contran 5,000 shares of its 6% Series A Preferred
Stock, par value $.01 per share (“Series A Preferred Stock”) under the terms of
a Stock Purchase Agreement dated March 26, 2007 (“Stock Purchase
Agreement”).
B. On
the
terms and subject to the conditions of this Agreement, Valhi and Contran
now
wish to amend certain terms of the Series A Preferred Stock, to be effective
March 26, 2007, which amendment will remove the cumulative nature of the
dividends on the Series A Preferred Stock.
Agreement
The
parties agree as follows:
ARTICLE I.
THE
AMENDMENT
Section 1.1. Certificate
of Designations, Rights and Preferences.
Notwithstanding the certificate of designations, rights and preferences attached
to Exhibit A to the Stock Purchase Agreement (the “Prior Certificate”),
effective March 26, 2007 the certificate of designations, rights and preferences
of the Series A Preferred Stock shall be as set forth on Exhibit A attached
hereto.
Section 1.2. Prior
Cumulative Dividends.
Notwithstanding the terms of the Prior Certificate, Contran agrees to completely
waive any rights to any dividend which may be deemed to have accrued to Contran
on the Series A Preferred Stock under the terms of the Prior Certificate.
Section 1.3. No
Other Changes.
All of the other terms, provisions and conditions of the Stock Purchase
Agreement shall remain hereafter unchanged in effect.
ARTICLE II.
REPRESENTATIONS
AND WARRANTIES OF VALHI
Valhi
hereby represents and warrants to Contran as of the date of this Agreement
as
follows:
Section 2.1. Authority. It
is a corporation validly existing and in good standing under the laws of
the
state of its incorporation. It has full corporate power and authority, without
the consent or approval of any other person, to execute and deliver this
Agreement and to consummate the Transaction. All corporate action required
to be
taken by or on behalf of it to authorize the execution, delivery and performance
of this Agreement has been duly and properly taken.
Section 2.2. Validity. This
Agreement is duly executed and delivered by it and constitutes its lawful,
valid
and binding obligation, enforceable in accordance with its terms. The execution
and delivery of this Agreement and the consummation of the Transaction by
it are
not prohibited by, do not violate or conflict with any provision of, and
do not
result in a default under (a) its charter or bylaws; (b) any material contract,
agreement or other instrument to which it is a party or by which it is bound;
(c) any order, writ, injunction, decree or judgment of any court or governmental
agency applicable to it; or (d) any law, rule or regulation applicable to
it,
except in each case for such prohibitions, violations, conflicts or defaults
that would not have a material adverse consequence to the
Transaction.
ARTICLE III.
REPRESENTATIONS
AND WARRANTIES OF CONTRAN
Contran
hereby represents and warrants to Valhi as of the date of this Agreement
as
follows:
Section 3.1. Authority. It
is a corporation validly existing and in good standing under the laws of
the
state of Delaware. It has full corporate power and authority, without the
consent or approval of any other person, to execute and deliver this Agreement
and to consummate the Transaction. All corporate and other actions required
to
be taken by or on behalf of it to authorize the execution, delivery and
performance of this Agreement have been duly and properly taken.
Section 3.2. Validity. This
Agreement is duly executed and delivered by it and constitutes its lawful,
valid
and binding obligation, enforceable in accordance with its terms. The execution
and delivery of this Agreement and the consummation of the Transaction by
it are
not prohibited by, do not violate or conflict with any provision of, and
do not
result in a default under (a) its charter or bylaws; (b) any material contract,
agreement or other instrument to which it is a party or by which it is bound;
(c) any order, writ, injunction, decree or judgment of any court or governmental
agency applicable to it; or (d) any law, rule or regulation applicable to
it,
except in each case for such prohibitions, violations, conflicts or defaults
that would not have a material adverse consequence to the
Transaction.
ARTICLE IV.
GENERAL
PROVISIONS
Section 4.1.
Survival. The
representations, warranties covenants and other agreements set forth in this
Agreement shall survive the execution of this Agreement and the consummation
of
the transactions contemplated herein.
Section 4.2. Amendment
and Waiver. No
amendment or waiver of any provision of this Agreement shall in any event
be
effective unless the same shall be in a writing referring to this Agreement
and
signed by the parties hereto, and then such amendment, waiver or consent
shall
be effective only in the specific instance and for the specific purpose for
which given.
Section 4.3. Parties
and Interest. This
Agreement shall bind and inure to the benefit of the parties named herein
and
their respective heirs, successors and assigns.
Section 4.4. Entire
Transaction. This
Agreement contains the entire understanding among the parties with respect
to
the transactions contemplated hereby and supersedes all other agreements
and
understandings among the parties with respect to the subject matter of this
Agreement.
Section 4.5. Applicable
Law. This
Agreement shall be governed by and construed in accordance with the domestic
laws of the state of Delaware, without giving effect to any choice of law
or
conflict of law provision or rule (whether of the state of Delaware or any
other
jurisdiction) that would cause the application of the laws of any jurisdiction
other than the state of Delaware.
Section 4.6.
Severability. If
any provision of this Agreement is found to violate any statute, regulation,
rule, order or decree of any governmental authority, court, agency or exchange,
such invalidity shall not be deemed to effect any other provision hereof
or the
validity of the remainder of this Agreement and such invalid provision shall
be
deemed deleted to the minimum extent necessary to cure such
violation.
Section 4.7. Notice. All
notices, requests, demands and other communications hereunder shall be in
writing and shall be sent by registered or certified mail, postage prepaid
as
follows:
If
toValhi: Valhi,
Inc.
0000
XXX
Xxxxxxx
Xxxxx
Xxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx,
Xxxxx 00000-0000
Attention: Secretary
If
to
Contran: Contran
Corporation
5430
LBJ
Freeway
Three
Xxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx,
Xxxxx 00000-0000
Attention: General
Counsel
Section 4.8. Headings. The
sections and other headings contained in this Agreement are for reference
purposes only and shall not effect in any way the meaning or interpretation
of
this Agreement.
The
parties hereto have caused this Agreement to be executed by their duly
authorized officers as of the date first written above.
VALHI,
INC.
By:
Xxxxxxx
X. Xxxxxxxx, Vice President
CONTRAN
CORPORATION
By:
Xxxxx
X. X’Xxxxx, Vice President
c:\documents
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agreement (2).doc
Exhibit
A
Certificate
of Designations, Rights and Preferences of 6% Series A Preferred Stock of
Valhi,
Inc.
AMENDED
AND RESTATED
CERTIFICATE
OF DESIGNATIONS, RIGHTS AND PREFERENCES OF
6%
SERIES A PREFERRED STOCK
Pursuant
to Section 151 of the
General
Corporation Law of the State of Delaware
Valhi,
Inc.,
a
Delaware corporation (the “Corporation”),
certifies as follows:
FIRST:
The
Certificate of Incorporation of the Corporation authorizes the issuance of
5,000,000 shares of Preferred Stock, par value $.01 per share, and, further,
authorizes the Board of Directors of the Corporation, subject to the limitations
prescribed by law and the provisions of the Certificate of Incorporation,
to
provide for the issuance of shares of the Preferred Stock or to provide for
the
issuance of shares of the Preferred Stock in one or more series, to establish
from time to time the number of shares to be included in each such series
and to
fix the designations, voting powers, preference rights and qualifications,
limitations or restrictions of the shares of the Preferred Stock of each
such
series.
SECOND:
The
Board of Directors of the Corporation, as of February 28, 2007, duly adopted
the
following resolutions, authorizing the creation and issuance of a series
of said
Preferred Stock to be known as 6% Series A Preferred Stock:
RESOLVED,
the
Board of Directors, pursuant to the authority vested in it by the provisions
of
the Certificate of Incorporation of the Corporation, hereby authorizes the
issuance of a series of the Corporation’s Preferred Stock, par value $.01 per
share, consisting of 5,000 shares of which are authorized to be issued under
the
Corporation’s Certificate of Incorporation (such 5,000 shares being hereinafter
referred to as the “Series
A Preferred Stock”),
of
the Corporation and hereby fixes the number thereof.
THIRD:
As of
March 29, 2007, the Board of Directors of the Corporation duly adopted, and
the
Sole Stockholder of the Series A Preferred stock consented to, the following
resolutions, authorizing the amendment and restatement of the certificate
of
designations, rights and preferences of the Series A Preferred
Stock:
RESOLVED,
the
Board of Directors, pursuant to the authority vested in it by the provisions
of
the Certificate of Incorporation of the Corporation, hereby authorizes the
amendment and restatement of the designations, preferences, rights and
limitations of the Series A Preferred Stock in addition to those set forth
in
said Certificate of Incorporation as follows:
Section 1. Certain
Definitions.
As used
in this Certificate, the following terms shall have the following meanings,
unless the context otherwise requires:
“Board
of Directors”
means
either the board of directors of the Corporation or any duly authorized
committee of such board.
“Business
Day”
means
any day other than a Saturday, Sunday or a day on which state or U.S. federally
chartered banking institutions in New York, New York are not required to
be
open.
“Capital
Stock”
of
any
Person means any and all shares, interests, participations or other equivalents
however designated of corporate stock or other equity participations, including
partnership interests, whether general or limited, of such Person and any
rights
(other than debt securities convertible or exchangeable into an equity
interest), warrants or options to acquire an equity interest in such Person
that
are traded on an established national or regional trading market or exchange,
including but not limited to the common stock, par value $.01 per share,
of
Valhi, Inc., a Delaware corporation.
“Certificate”
means
this Certificate of Designations, Rights and Preferences of 6% Series A
Preferred Stock.
“Certificate
of Incorporation”
means
the Certificate of Incorporation of the Corporation, as amended from time
to
time.
“Common
Stock”
means
the voting Common Stock, $.01 par value per share, of the Corporation and
any
other stock of any class of the Corporation that has no preference in respect
of
dividends or of amounts payable in the event of any voluntary or involuntary
liquidation, dissolution or winding up of the Corporation.
“Corporation”
means
Valhi, Inc., a Delaware corporation, and its successors.
“Dividend
Payment Date”
means
March 31, June 30, September 30 and December 31, of each year, or if any
such
date is not a Business Day, on the next succeeding Business Day.
“Dividend
Period”
means
the period beginning on, and including, a Dividend Payment Date and ending
on,
and excluding, the immediately succeeding Dividend Payment Date.
“Liquidation
Preference”
has
the
meaning assigned to such term in Section
4(a).
“Outstanding”
means,
when used with respect to Series A Preferred Stock, as of any date of
determination, all shares of Series A Preferred Stock outstanding as of such
date; provided
further
that, in
determining whether the holders of Series A Preferred Stock have given any
request, demand, authorization, direction, notice, consent or waiver or taken
any other action hereunder, Series A Preferred Stock owned by the Corporation
shall be deemed not to be outstanding.
“Parity
Stock”
has
the
meaning assigned to such term in Section
2.
“Person”
means
an individual, a corporation, a partnership, a limited liability company,
an
association, a trust or any other entity or organization, including a government
or political subdivision or an agency or instrumentality thereof.
“Record
Date”
means
with respect to the dividends payable on March 31, June 30, September 30
and
December 31 of each year, March 15, June 15, September 15 and December 15
of each year, respectively, or such other record date, not more than 60 days
and
not less than 10 days preceding the applicable Dividend Payment Date, as
may be
fixed by the Board of Directors.
“Senior
Stock”
has
the
meaning assigned to such term in Section
2.
“Series
A Preferred Stock”
has
the
meaning assigned to such term in the Resolution set forth in the Preamble
hereto.
Section 2. Rank.
The
Series A Preferred Stock shall, with respect to rights upon liquidation,
dissolution or winding up of the Corporation, rank (a) senior to all classes
or
series of Common Stock and to any other class or series of equity securities
issued by the Corporation not referred to in clauses (b) or (c) of this
paragraph, (b) on a parity with all equity securities issued by the Corporation
in the future, the terms of which specifically provide that such equity
securities rank on a parity with the Series A Preferred Stock with respect
to
dividend rights or rights upon the liquidation, dissolution or winding up
of the
Corporation (“Parity
Stock”)
and
(c) junior to all equity securities issued by the Corporation in the future
the
terms of which specifically provide that such equity securities rank senior
to
the Series A Preferred Stock with respect to dividend rights or rights upon
the
liquidation, dissolution or winding up of the Corporation (“Senior
Stock”).
The
term “equity securities” shall not include convertible debt
securities.
Section 3. Dividends.
(a) Holders
of the then Outstanding shares of Series A Preferred Stock shall be entitled
to
receive, only when and as authorized and declared by the Board of Directors,
out
of funds legally available for the payment of dividends, cash dividends at
the
rate of 6% of the $133,466.75 per share Liquidation Preference per annum.
If, as
and when declared, such dividends shall be payable quarterly in arrears on
each
Dividend Payment Date. Any dividend payable on the Series A Preferred Stock
for
any full or partial Dividend Period will be computed on the basis of a 360-day
year consisting of twelve 30-day months. Dividends will be payable to holders
of
record as they appear in the stock records of the Corporation at the close
of
business on the applicable Record Date.
(b) No
dividends on shares of Series A Preferred Stock shall be declared by the
Corporation or paid or set apart for payment by the Corporation at such time
as
the terms and provisions of any agreement of the Corporation, including any
agreement relating to its indebtedness, prohibit such declaration, payment
or
setting apart for payment or provide that such declaration, payment or setting
apart for payment would constitute a breach thereof or a default thereunder,
or
if such declaration or payment shall be restricted or prohibited by
law.
(c) Dividends
on the Series A Preferred Stock that are not declared or paid for any full
or
partial Dividend Period shall not accrue or accumulate under any
circumstances.
(d) Nothing
contained herein shall prevent or restrict the Corporation from the declaration,
payment or set aside for payment or any other distribution of cash or other
property, directly or indirectly, on or with respect to any shares of the
Common
Stock, or shares of any other class or series of equity securities ranking
junior to or on a parity with the Series A Preferred Stock as to dividends
or
upon liquidation, including without limitation not declaring or paying any
dividend on the Series A Preferred Stock for any full or partial Dividend
Period. Further, nothing contained herein shall prevent or restrict the
Corporation from redeeming, purchasing or otherwise acquiring for any
consideration (or any moneys be paid to or made available for a sinking fund
for
the redemption of any such shares) by the Corporation any shares of Common
Stock, or any shares of equity securities ranking junior to or on a parity
with
the Series A Preferred Stock as to dividends or upon liquidation, including
without limitation not declaring or paying any dividend on the Series A
Preferred Stock for any full or partial Dividend Period.
Section 4. Liquidation
Preference.
(a) Upon
any
voluntary or involuntary liquidation, dissolution or winding up of the affairs
of the Corporation, the holders of shares of Series A Preferred Stock then
Outstanding are entitled to be paid out of the assets of the Corporation,
legally available for distribution to its stockholders, a liquidation preference
of $133,466.75 per share of Series A Preferred Stock (the “Liquidation
Preference”),
plus
an amount equal to any declared and unpaid dividends (and only to the extent
declared and unpaid) for the full or partial Dividend Period in which the
liquidation, dissolution or winding up occurs, before any distribution of
assets
is made to holders of Common Stock or any other class or series of equity
securities that ranks junior to the Series A Preferred Stock as to liquidation
rights.
(b) In
the
event that, upon any such voluntary or involuntary liquidation, dissolution
or
winding up, the available assets of the Corporation are insufficient to pay
the
amount of the liquidating distributions on all Outstanding shares of Series
A
Preferred Stock and the corresponding amounts payable on all shares of each
other class or series of equity securities ranking on a parity with the Series
A
Preferred Stock as to liquidation rights, then the holders of the Series
A
Preferred Stock and each such other class or series of equity securities
shall
share proportionately in any such distribution of assets in proportion to
the
full liquidating distributions to which they would otherwise be respectively
entitled.
(c) After
payment of the full amount of the liquidating distributions to which they
are
entitled, the holders of Series A Preferred Stock will have no right or claim
to
any of the remaining assets of the Corporation.
(d) Written
notice of any such liquidation, dissolution or winding up of the Corporation,
stating the payment date or dates when, and the place or places where, the
amounts distributable in such circumstances shall be payable, shall be given
by
first class mail, postage pre-paid, not less than 30 nor more than 60 days
prior
to the payment date stated therein, to each record holder of the Series A
Preferred Stock at the respective addresses of such holders as the same shall
appear on the stock transfer records of the Corporation.
(e) The
consolidation or merger of the Corporation with or into any other corporation,
trust or entity or of any other corporation with or into the Corporation,
or the
sale, lease or conveyance of all or substantially all of the property or
business of the Corporation, shall not be deemed to constitute a liquidation,
dissolution or winding up of the Corporation.
Section 5. Voting
Rights.
(a) Holders
of the Series A Preferred Stock will not have any voting rights, except as
set
forth below or as otherwise provided in the Certificate of Incorporation,
by law
or pursuant to agreements among the holders of voting equity securities of
the
Corporation.
(b) The
affirmative vote of holders of at least two-thirds of the Outstanding shares
of
the Series A Preferred Stock and all other Parity Stock with like voting
rights,
voting as a single class, in person or by proxy, at a special meeting called
for
the purpose, or by written consent in lieu of meeting, shall be required
to
alter, repeal or amend, whether by merger, consolidation, combination,
reclassification or otherwise, any provisions of the Certificate of
Incorporation if the amendment would amend, alter or affect the powers,
preferences or rights of the Series A Preferred Stock, so as to adversely
affect
the holders thereof; provided,
however,
that
any increase in the amount of the authorized common stock or authorized
preferred stock or the creation and issuance of other series of common stock
or
preferred stock will not be deemed to materially and adversely affect such
powers, preferences or special rights.
Section 6. Consolidation,
Merger and Sale of Assets.
The
Corporation, without the consent of the holders of any of the Outstanding
Series
A Preferred Stock, may consolidate with or merge into any other Person or
convey, transfer or lease all or substantially all of its assets to any Person
or may permit any Person to consolidate with or merge into, or transfer or
lease
all or substantially all its properties to the Corporation.
Section 7. Headings.
The
headings of the Sections of this Certificate are for convenience of reference
only and shall not define, limit or affect any of the provisions
hereof.
IN
WITNESS WHEREOF, the Corporation has caused this Certificate to be signed
in its
name and on its behalf on this 29th
day of
March, 2007.
Valhi,
Inc.
By:
|
Xxxxxxx
X. Xxxxxxxx
Vice
President and Controller