EXHIBIT 99.4
================================================================================
SHAREHOLDER AGREEMENT
by and among
INTERSTATE BAKERIES CORPORATION,
▇▇▇▇▇▇▇ PURINA COMPANY
and
VCS HOLDING COMPANY
Dated July 22, 1995
================================================================================
TABLE OF CONTENTS
Page
ARTICLE 1 - DEFINITIONS..................................................... 1
Section 1.1 Affiliate................................................ 1
Section 1.2 Applicable Acceptance Period............................. 1
Section 1.3 Associate................................................ 1
Section 1.4 Business Day............................................. 1
Section 1.5 CBC...................................................... 2
Section 1.6 Closing.................................................. 2
Section 1.7 Control.................................................. 2
Section 1.8 Demand Notice............................................ 2
Section 1.9 Demand Registration...................................... 2
Section 1.10 Exchange Act............................................. 2
Section 1.11 First Offer.............................................. 2
Section 1.12 First Registration Rights Agreement...................... 2
Section 1.13 Group.................................................... 2
Section 1.14 IBC...................................................... 2
Section 1.15 IBC Call................................................. 2
Section 1.16 IBC Equity............................................... 2
Section 1.17 IBC Indemnified Party.................................... 2
Section 1.18 IBC Market Price......................................... 3
Section 1.19 IBC Stock................................................ 3
Section 1.20 IBC Securities........................................... 3
Section 1.21 Incidental Notice........................................ 3
Section 1.22 Loss..................................................... 3
Section 1.23 Marketable Number........................................ 3
Section 1.24 Notice of Exercise....................................... 3
Section 1.25 Notice of Intention...................................... 3
Section 1.26 Offered Shares........................................... 3
Section 1.27 Person................................................... 3
Section 1.28 Purchase Agreement....................................... 4
Section 1.29 RAL Stock................................................ 4
Section 1.30 ▇▇▇▇▇▇▇.................................................. 4
Section 1.31 ▇▇▇▇▇▇▇ Indemnified Party................................ 4
Section 1.32 Registration Statement................................... 4
Section 1.33 RPC...................................................... 4
Section 1.34 SEC...................................................... 4
Section 1.35 Securities Act........................................... 4
Section 1.36 Securities Exchange Act.................................. 4
Section 1.37 Transfer................................................. 4
Section 1.38 VCS...................................................... 4
ARTICLE II - STANDSTILL AND VOTING PROVISIONS............................... 4
Section 2.1 Standstill Covenants..................................... 4
Section 2.2 Issuance of IBC Securities............................. 6
Section 2.3 Voting of IBC Equity................................... 6
ARTICLE III - TRANSFERS OF IBC EQUITY.................................... 6
Section 3.1 Restrictions on Transfer............................... 6
Section 3.2 Exceptions to Restrictions............................. 7
Section 3.3 Other Transfers........................................ 7
Section 3.4 Improper Transfer...................................... 7
Section 3.5 Restrictive Legend..................................... 7
ARTICLE IV - RIGHT OF FIRST OFFER....................................... 9
Section 4.1 Sales by ▇▇▇▇▇▇▇....................................... 9
Section 4.2 Purchase of the Offered Shares......................... 9
Section 4.3 Waiting Period with Respect to Subsequent Transfers.... 10
ARTICLE V - REGISTRATION............................................... 10
Section 5.1 Demand Registration.................................... 10
Section 5.2 Delay of Demand Registration........................... 11
Section 5.3 Incidental Registration................................ 12
Section 5.4 Delay of Incidental Registration....................... 13
Section 5.5 Third Party Registration Rights........................ 13
ARTICLE VI - REGISTRATION EXPENSES...................................... 13
Section 6.1 Registration Expenses.................................. 13
ARTICLE VII - REGISTRATION PROCEDURE..................................... 14
Section 7.1 ▇▇▇▇▇▇▇ Information.................................... 14
Section 7.2 Compliance............................................. 15
Section 7.3 Provision of Prospectuses.............................. 15
Section 7.4 Blue Sky Compliance.................................... 15
Section 7.5 Maintenance of Effectiveness........................... 15
Section 7.6 Listing of IBC Equity.................................. 16
Section 7.7 Stop-Orders............................................ 16
ARTICLE VIII - INDEMNIFICATION AND CONTRIBUTION........................... 16
Section 8.1 Indemnification........................................ 16
Section 8.2 Contribution........................................... 19
ARTICLE IX - CALL RIGHTS................................................ 19
Section 9.1 IBC Call............................................... 19
ARTICLE X - ADDITIONAL COVENANTS....................................... 20
Section 10.1 Maintain Listing or Quotation.......................... 20
Section 10.2 Board of Directors..................................... 20
Section 10.3 No Inconsistent Agreements............................. 20
Section 10.4 Preferred Stock........................................ 21
Section 10.5 Rule 144 and 144A...................................... 21
-ii-
Section 10.6 Maximum Allowed Ownership of IBC Securities............................. 21
ARTICLE XI - MISCELLANEOUS................................................................. 21
Section 11.1 Entire Agreement........................................................ 21
Section 11.2 Headings and Captions................................................... 21
Section 11.3 Choice of Law........................................................... 21
Section 11.4 Venue................................................................... 21
Section 11.5 Notices................................................................. 21
Section 11.6 Amendments.............................................................. 22
Section 11.7 Extended Meanings....................................................... 22
Section 11.8 Assignments............................................................. 22
Section 11.9 Severability............................................................ 23
Section 11.10 Counterparts............................................................ 23
Section 11.11 Remedies Cumulative..................................................... 23
Section 11.12 Binding Agreement....................................................... 23
Section 11.13 Recapitalizations, Exchanges, Etc., Affecting IBC Securities............ 23
Section 11.14 Other Agreements........................................................ 23
Section 11.15 Term; Effectiveness..................................................... 23
Section 11.16 Enforcement............................................................. 24
Section 11.17 Confidentiality......................................................... 24
Section 11.18 Fiduciary Accounts...................................................... 24
-iii-
SHAREHOLDER AGREEMENT
THIS SHAREHOLDER AGREEMENT dated July 22, 1995 (the "Agreement"), is made
by and among INTERSTATE BAKERIES CORPORATION, a Delaware corporation ("IBC"),
▇▇▇▇▇▇▇ PURINA COMPANY, a Missouri corporation ("RPC") and VCS HOLDING COMPANY,
a Delaware corporation and a wholly-owned subsidiary of RPC ("VCS") (RPC, VCS
and any of their Affiliates (as defined below) which own IBC Equity (as defined
below) are collectively referred to as "▇▇▇▇▇▇▇").
WHEREAS, pursuant to that certain Sale and Purchase Agreement dated as of
April 12, 1995 (the "Purchase Agreement") by and among IBC, RPC, VCS and
CONTINENTAL BAKING COMPANY, a Delaware corporation and wholly-owned subsidiary
of VCS ("CBC"), IBC acquired all of the outstanding shares of capital stock of
CBC, par value $100 per share, from VCS in exchange for cash in the amount of
$220,000,000 and 16,923,077 shares of IBC Stock (as defined below); and
WHEREAS, the parties hereto desire to enter into this Agreement to provide
for certain rights and restrictions with respect to the shares of IBC Equity.
NOW, THEREFORE, in consideration of the mutual covenants and obligations
set forth herein, each of IBC and ▇▇▇▇▇▇▇ agree as follows:
ARTICLE I
DEFINITIONS
As used in this Agreement, and unless the context requires a different meaning,
the following terms (whether used in the singular or plural) have the meanings
indicated. Any term used and not defined herein has the meaning set forth in
the Purchase Agreement.
Section 1.1 Affiliate. An "Affiliate" of a Person, means any other
Person that directly or indirectly through one or more intermediaries Controls,
is controlled by or is under common control with such Person. When used in this
Agreement with respect to IBC, the term applies only to other Persons that are
Affiliates, as so defined, as of the date of this Agreement.
Section 1.2 Applicable Acceptance Period. "Applicable Acceptance Period"
has the meaning set forth in Section 4.1(c) of this Agreement.
Section 1.3 Associate. An "Associate" of a Person, means any of such
Person's directors, officers, shareholders, representatives, trustees,
employees, attorneys, advisors, or agents.
Section 1.4 Business Day. "Business Day" means any day other than a
Saturday, Sunday or legal holiday for commercial banks in Kansas City, Missouri.
Section 1.5 CBC. "CBC" has the meaning set forth above in the recitals
to this Agreement.
Section 1.6 Closing. "Closing" means the closing of the transactions
contemplated by the Purchase Agreement.
Section 1.7 Control. "Control" (including the terms "controlling,"
"controlled by" and "under common control with") means the possession of the
power, directly or indirectly, (a) to elect a majority of the board of directors
(or equivalent governing body) of the entity in question; or (b) to direct or
cause the direction of the management and policies of or with respect to the
entity or assets in question, whether through ownership of securities, by
contract or otherwise.
Section 1.8 Demand Notice. "Demand Notice" has the meaning set forth in
Section 5.1 of this Agreement.
Section 1.9 Demand Registration. "Demand Registration" has the meaning
set forth in Section 5.1 of this Agreement.
Section 1.10 Exchange Act. "Exchange Act" means the Securities Exchange
Act of 1934, as amended, and the rules and regulations thereunder.
Section 1.11 First Offer. "First Offer" has the meaning set forth in
Section 4.1(a) of this Agreement.
Section 1.12 First Registration Rights Agreement. "First Registration
Rights Agreement" has the meaning set forth in Section 5.5 of this Agreement.
Section 1.13 Group. "Group" means any group of Persons within the meaning
of Section 13(d)(3) of the Exchange Act.
Section 1.14 IBC. "IBC" has the meaning set forth above in the recitals
to this Agreement.
Section 1.15 IBC Call. "IBC Call" means the right of IBC to acquire
certain IBC Equity pursuant to Section 9.1(a) of this Agreement.
Section 1.16 IBC Equity. "IBC Equity" means shares of IBC Stock acquired
by ▇▇▇▇▇▇▇ at the Closing and any other IBC Securities owned, beneficially or of
record, by ▇▇▇▇▇▇▇ at any time during the term of this Agreement.
Section 1.17 IBC Indemnified Party. "IBC Indemnified Party" has the
meaning set forth in Section 8.1(a) of this Agreement.
Section 1.18 IBC Market Price. "IBC Market Price" means the average of
the closing sale prices of the class of IBC Securities being valued on the New
York Stock Exchange or if
such IBC Securities are not listed or admitted to trading on the New York Stock
Exchange, as reported in the principal consolidated transaction reporting system
of the principal national securities exchange on which the security is listed or
admitted to trading, for the twenty (20) trading days which end on the day
immediately prior to the date of the (i) Notice of Exercise delivered pursuant
to an IBC Call; (ii) Notice of Intention; (iii) Demand Notice; or (iv)
Incidental Notice, as the case may be. If the IBC Securities are not listed or
admitted to trading on any national securities exchange, the IBC Market Price
means the last quoted sale price or, if not so quoted, the average of the high
bid and low asked prices in the over-the-counter market, as reported by the
National Association of Securities Dealers, Inc. Automated Quotations System or
such other system then in use, for the twenty (20) trading days which end on the
day immediately prior to such date, or, if on any such trading day such IBC
Securities are not quoted by any such organization, the average of the closing
bid and asked prices as furnished by two professional market makers making a
market in such securities, one selected in good faith by the board of directors
of IBC and the other selected in good faith by ▇▇▇▇▇▇▇. If the IBC Securities
are not publicly held or so listed or publicly traded, IBC Market Price means
the cash price at which a willing seller would sell and a willing buyer would
buy such securities in an arm's-length negotiated transaction without undue time
restraints, as determined in good faith by, an investment banking firm selected
by agreement between IBC and ▇▇▇▇▇▇▇.
Section 1.19 IBC Stock. "IBC Stock" means the $.01 par value common stock
of IBC.
Section 1.20 IBC Securities. "IBC Securities" means any voting securities
of IBC or its affiliates, including any securities convertible into or
exercisable or exchangeable for any voting securities of IBC.
Section 1.21 Incidental Notice. "Incidental Notice" has the meaning set
forth in Section 5.3(a) of this Agreement.
Section 1.22 Loss. "Loss" has the meaning set forth in Section 8.1(a)(i)
of this Agreement.
Section 1.23 Marketable Number. "Marketable Number" has the meaning set
forth in Section 5.3(b) of this Agreement.
Section 1.24 Notice of Exercise. "Notice of Exercise" has the meaning set
forth in Section 4.1(c) of this Agreement.
Section 1.25 Notice of Intention. "Notice of Intention" has the meaning
set forth in Section 4.1(b) of this Agreement.
Section 1.26 Offered Shares. "Offered Shares" has the meaning set forth
in Section 4.1(b) of this Agreement.
Section 1.27 Person. "Person" means an individual, corporation,
partnership, trust, incorporated or unincorporated association, joint venture,
joint stock company, limited liability company, government (or an agency or
political subdivision thereof) or other entity of any kind.
Section 1.28 Purchase Agreement. "Purchase Agreement" has the meaning set
forth above in the recitals to this Agreement.
Section 1.29 RAL Stock. "RAL Stock" means RPC's ▇▇▇▇▇▇▇-▇▇▇▇▇▇▇ Purina
Group Common Stock, $.10 par value per share, or any such other class of common
stock of RPC at any time outstanding.
Section 1.30 ▇▇▇▇▇▇▇. "▇▇▇▇▇▇▇" has the meaning set forth above in the
recitals to this Agreement.
Section 1.31 ▇▇▇▇▇▇▇ Indemnified Party. "▇▇▇▇▇▇▇ Indemnified Party" has
the meaning set forth in Section 8.1(b) of this Agreement.
Section 1.32 Registration Statement. "Registration Statement" means any
registration statement or comparable document under Section 5 of the Securities
Act through which a public sale or disposition of IBC Securities may be
registered other than a registration statement (a) relating to an Employee
Benefit Plan or similar plan, or a business combination; or (b) on any form that
is not available for a secondary offering.
Section 1.33 RPC. "RPC" has the meaning set forth above in the recitals
to this Agreement.
Section 1.34 SEC. "SEC" means the Securities and Exchange Commission or
other federal agency at the time administering the Securities Act, the Exchange
Act or any successor acts thereto.
Section 1.35 Securities Act. "Securities Act" means the Securities Act of
1933, as amended, and the rules and regulations thereunder.
Section 1.36 Securities Exchange Act. "Securities Exchange Act" means the
Securities Exchange Act of 1934, as amended, and the rules and regulations
thereunder.
Section 1.37 Transfer. "Transfer" with respect to all or any part of the
IBC Equity means to directly or indirectly (whether or not through an
underwriter) offer, sell, convey, distribute, transfer (by merger or otherwise),
assign, devise, exchange, encumber, gift, pledge, hypothecate or otherwise
dispose of such IBC Equity.
Section 1.38 VCS. "VCS" has the meaning set forth above in the recitals
to this Agreement.
ARTICLE II STANDSTILL AND VOTING PROVISIONS
Section 2.1 Standstill Covenants. Unless specifically requested or
permitted in writing in advance by the Chairman of the Board of IBC or unless
otherwise permitted in this Agreement, ▇▇▇▇▇▇▇ agrees that until the sixth
anniversary date of this Agreement, it will not, directly or indirectly:
(a) acquire, offer to acquire, or agree to acquire by purchase or
otherwise, any IBC Securities except as a result of a stock split, stock
dividend or similar recapitalization by IBC;
(b) except in the ordinary course of business, acquire, offer to
acquire, or agree to acquire by purchase or otherwise, any assets of IBC;
(c) initiate, solicit, propose, seek to effect or negotiate, alone or
with any other Person, (i) any form of business combination transaction
involving IBC or any Affiliate thereof, or (ii) any restructuring,
recapitalization or similar transaction with respect to IBC or any
Affiliate thereof;
(d) initiate, solicit, propose, seek to effect, negotiate, or
announce an intent to make, alone or with any other Person, any tender
offer, exchange offer, merger, consolidation or share exchange for any IBC
Securities, or disclose an intent, purpose, plan or proposal with respect
to IBC, any of its Affiliates or any IBC Securities inconsistent with the
provisions of this Agreement;
(e) make, or in any way participate in, any "solicitation" of
"proxies" (as such terms are defined or used in Regulation 14A under the
Exchange Act) with respect to IBC or any of its Affiliates or become a
"participant" in any "election contest" (as such terms are defined or used
in Rule 14a-11 under the Exchange Act) involving IBC or any of its
Affiliates;
(f) initiate, solicit, or propose the approval of one or more
shareholder proposals with respect to IBC or any of its Affiliates or
induce or attempt to induce any other Person to initiate any such
shareholder proposal;
(g) form, join or in any way participate in a Group with respect to
the IBC Securities;
(h) except as expressly provided herein, seek election to or seek to
place a representative on the board of directors of IBC or any of its
affiliates or seek the removal of any member of the board of directors of
IBC or any of its Affiliates;
(i) except for participation on the board of directors of IBC, act in
concert with any other Person to seek to affect the management or board of
directors of IBC or any of its Affiliates or the business, operations or
affairs of IBC or any of its Affiliates;
(j) call or seek to have called any meeting of the shareholders of
IBC or any of its Affiliates;
(k) disclose to any third party or in any filing with any
governmental authority any intention, plan or arrangement inconsistent with
any of the foregoing or with the restrictions on transfer set forth in this
Agreement; or
(l) enter into any discussions, negotiations, arrangements or
understandings with any third party with respect to any of the foregoing,
or advise, assist, encourage or influence any other Person to take any
action with respect to any of the foregoing.
Section 2.2 Issuance of IBC Securities. Notwithstanding anything in
Section 2.1 herein, during the term of this Agreement, if IBC issues any IBC
Securities in a public offering (other than a public offering of ▇▇▇▇▇▇▇'▇ IBC
Equity) or as consideration in an acquisition, ▇▇▇▇▇▇▇ may purchase in one or
more open market transactions or otherwise that number of shares necessary to
bring its percentage of ownership in IBC to the same level as immediately prior
to such offering or acquisition; provided, however, that ▇▇▇▇▇▇▇ must still
comply with the provisions of Section 10.6.
Section 2.3 Voting of IBC Equity. ▇▇▇▇▇▇▇ agrees that during the term of
this Agreement, with respect to the election of directors of IBC, each class of
IBC Equity owned by ▇▇▇▇▇▇▇ shall be voted (i) "for" the nominees recommended by
the Board of Directors of IBC, provided IBC is in compliance with the terms of
Section 10.2 of this Agreement, (ii) in accordance with the recommendation of
the Board of Directors of IBC on each proposal of a security holder pursuant to
Rule 14a-8 under the Securities Exchange Act, so long as the subject matter of
such proposal does not fall within the proviso hereto, and, (iii) with respect
to all other matters requiring a vote of the IBC Equity, "for" any proposal in
the same proportion as the votes cast "for" such proposal by the holders of the
IBC Securities of the same class (excluding the IBC Equity owned by ▇▇▇▇▇▇▇),
and "against" any proposal in the same proportion as the votes cast "against"
such proposal by the holders of each such class of IBC Securities (excluding the
IBC Equity owned by ▇▇▇▇▇▇▇) and that with respect to broker non-votes and
abstentions, each class of IBC Equity owned by ▇▇▇▇▇▇▇ will be voted in the same
proportion as votes deemed "for," "against" or "abstain," giving the effect to
broker non-votes and abstentions as required under the laws and rules then
applicable; provided, however, that ▇▇▇▇▇▇▇ shall retain the right to vote its
IBC Equity in any manner it sees fit with respect to any proposals for (1) the
merger of IBC or any subsidiary of IBC with or into any other corporation, (2)
the sale, lease, exchange, transfer or other disposition of all or substantially
all of the assets of IBC and all of its subsidiaries taken together as a single
business, or (3) the creation of any other class of stock with voting rights.
The provisions of this Section 2.3 shall apply to both the casting of votes at
meetings of shareholders and execution of actions by written consent.
ARTICLE III TRANSFERS OF IBC EQUITY
Section 3.1 Restrictions on Transfer. During the term of this Agreement,
▇▇▇▇▇▇▇ agrees that it will not, and it will cause each of its Affiliates who
acquire IBC Equity pursuant to Sections 3.2(c) or 3.3(c) of this Agreement not
to, Transfer any IBC Equity, except as permitted by or in accordance with this
Agreement.
Section 3.2 Exceptions to Restrictions. Subject to all applicable laws,
the restrictions on Transfer set forth in Section 3.1 hereof shall not apply to
any of the following:
(a) a Transfer of some or all of the IBC Equity pro rata to all of
the holders of the RAL Stock as a dividend or distribution or similar
transaction;
(b) a Transfer of some or all of the IBC Equity to an Affiliate of
▇▇▇▇▇▇▇, provided that such Affiliate shall agree to the provisions of this
Agreement and ▇▇▇▇▇▇▇ will remain liable for the performance by such
Affiliate of its obligations under this Agreement;
(c) a Transfer of some or all of the IBC Equity in accordance with
Section 5.3 of this Agreement;
(d) a Transfer of some or all of the IBC Equity in any tender offer,
self-tender, exchange offer, going private transaction or other transaction
involving a Transfer which is recommended to shareholders of IBC by the
board of directors of IBC;
(e) a Transfer of some or all of the IBC Equity in accordance with
Section 5.1 of this Agreement; and
(f) a Transfer of some or all of the IBC Equity allowed under Rule
144 of the Securities Act.
Section 3.3 Other Transfers. In the event ▇▇▇▇▇▇▇ desires to Transfer
the IBC Equity in a manner not specifically permitted under Sections 3.2 of this
Agreement, ▇▇▇▇▇▇▇ may submit a written Notice of Intention (as defined in
Section 4.1 hereof) to IBC. In the event IBC declines to purchase the IBC Equity
described in the Notice of Intention, and if, in the sole and absolute
discretion of IBC, the Chairman of the Board of IBC notifies ▇▇▇▇▇▇▇ in writing
that such Transfer may occur, the Transfer may proceed strictly in accordance
with ▇▇▇▇▇▇▇'▇ Notice of Intention and with any terms and conditions imposed by
IBC on such Transfer and the transferee.
Section 3.4 Improper Transfer. Any attempt to Transfer any shares of IBC
Equity during the term of this Agreement not in accordance with this Agreement
will be null and void and IBC will not give nor permit the transfer agent of IBC
to give any effect to such attempted Transfer in its stock records.
Section 3.5 Restrictive Legend.
(a) A copy of this Agreement will be filed with the Secretary of IBC
and kept with the records of IBC. All certificates representing shares of
IBC Equity hereafter issued to or acquired by ▇▇▇▇▇▇▇, if applicable, (or,
if applicable, its successors in a Transfer pursuant to Section 3.3) will
bear the following legend noted conspicuously on such certificates:
THE SHARES EVIDENCED BY THIS CERTIFICATE HAVE BEEN ACQUIRED FOR
INVESTMENT ONLY, AND MAY NOT BE OFFERED, SOLD, TRANSFERRED (BY MERGER
OR OTHERWISE) ASSIGNED, DEVISED, EXCHANGED, GIFTED, PLEDGED,
HYPOTHECATED OR OTHERWISE DISPOSED OF UNLESS AND UNTIL REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT") AND ANY
APPLICABLE STATE SECURITIES LAWS OR UNLESS SUCH TRANSFER IS EXEMPT
FROM REGISTRATION, AND AN ACCEPTABLE OPINION OF COUNSEL IS DELIVERED
TO IBC WITH REGARD TO SUCH EXEMPTION, OR IS OTHERWISE IN COMPLIANCE
WITH THE ACT AND SUCH STATE SECURITIES LAWS.
THE SHARES EVIDENCED BY THIS CERTIFICATE ARE SUBJECT TO THE
RESTRICTIONS ON TRANSFER AS SET FORTH IN THE SHAREHOLDER AGREEMENT,
DATED JULY 22, 1995. NO TRANSFER OF THESE SHARES WILL BE EFFECTIVE
UNLESS AND UNTIL THE TERMS AND CONDITIONS OF SUCH SHAREHOLDER
AGREEMENT HAVE BEEN COMPLIED WITH IN FULL AND NO PERSON MAY REQUEST
INTERSTATE BAKERIES CORPORATION TO RECORD THE TRANSFER OF ANY SHARES
IF SUCH TRANSFER IS IN VIOLATION OF SUCH SHAREHOLDER AGREEMENT. A COPY
OF THE SHAREHOLDER AGREEMENT IS ON FILE AT THE EXECUTIVE OFFICES OF
INTERSTATE BAKERIES CORPORATION AND WILL BE FURNISHED WITHOUT CHARGE
TO THE HOLDER OF SUCH SHARES UPON WRITTEN REQUEST. THE SHARES
EVIDENCED BY THIS CERTIFICATE ARE SUBJECT TO RESTRICTIONS ON VOTING
PROVIDED FOR IN THE SHAREHOLDER AGREEMENT AND NO VOTE OF SUCH SHARES
THAT CONTRAVENES THE SHAREHOLDER AGREEMENT SHALL BE EFFECTIVE.
(b) Until such time as the IBC Equity has been registered pursuant to
a registration statement under the Securities Act or sold pursuant to Rule
144 of the Securities Act, the certificates representing IBC Equity
(including, without limitation, all certificates issued upon Transfer or in
exchange thereof or substitution therefor) will also bear any legend
required under any other applicable laws, including state securities or
blue sky laws.
(c) IBC may make a notation on its records or give stop-transfer
instructions to any transfer agents or registrars for the IBC Equity in
order to implement the restrictions set forth in this Article III hereof.
(d) In the event ▇▇▇▇▇▇▇ acquires any other or additional IBC
Securities, ▇▇▇▇▇▇▇ will submit all certificates representing such IBC
Securities to IBC so that the legend or legends required by this Section
3.5 may be placed thereon.
ARTICLE IV RIGHT OF FIRST OFFER
Section 4.1 Sales by ▇▇▇▇▇▇▇.
(a) Except for Transfers permitted by Section 3.2 (a), (b) or (e),
during the term of this Agreement, ▇▇▇▇▇▇▇ shall not sell any shares of IBC
Equity to any Person unless it has first made an offer (the "First Offer")
to sell such shares to IBC in accordance with this Article IV and such
First Offer shall have been rejected or not accepted within the Applicable
Acceptance Period (as hereinafter defined).
(b) The First Offer to IBC s hall be set forth in the form of a
notice made in writing (the "Notice of Intention") to IBC setting forth (i)
▇▇▇▇▇▇▇'▇ desire to make a sale; and (ii) the number of shares of IBC
Equity proposed to be sold (the "Offered Shares").
(c) Upon receipt of the Notice of Intention, IBC will have the right
to purchase the Offered Shares at the IBC Market Price, exercisable by the
delivery of an acceptance in the form of a notice in writing to ▇▇▇▇▇▇▇ by
IBC (the "Notice of Exercise") at any time within twenty (20) calendar days
from the date of receipt of the Notice of Intention (the "Applicable
Acceptance Period"). The right of IBC to purchase IBC Equity will terminate
if such Notice of Exercise is not delivered within Applicable Acceptance
Period. IBC may assign its right to purchase the Offered Shares pursuant to
a specific Notice of Intention, once received by IBC, to any Person, but
may not otherwise assign its rights under this Article IV.
(d) In the event that IBC exercises its right to purchase the Offered
Shares in accordance with Section 4.1(c) hereof, then ▇▇▇▇▇▇▇ must sell the
Offered Shares to IBC at the IBC Market Price within twenty (20) days from
the date of receipt of the Notice of Exercise delivered by IBC, subject to
receipt of any required material third-party or governmental approvals,
compliance with applicable laws and the absence of any injunction or
similar legal order preventing such transaction.
Section 4.2 Purchase of the Offered Shares. In the event IBC rejects the
First Offer or fails to deliver a Notice of Exercise within the Applicable
Acceptance Period, then ▇▇▇▇▇▇▇ may (a) proceed with the Transfer pursuant to
Articles V, VI, VII and VIII hereof, if applicable, or (b) otherwise sell such
Offered Shares to transferees who agree to be bound by the terms and conditions
of this Agreement, in the case of a rejection, within ninety (90) days after the
delivery
of such rejection or, in the case of a failure to deliver a Notice of Exercise,
within ninety (90) days after the expiration of the Applicable Acceptance
Period, subject to the other terms and conditions of this Agreement.
Section 4.3 Waiting Period with Respect to Subsequent Transfers. In the
event that IBC does not deliver a Notice of Exercise within the Applicable
Acceptance Period and ▇▇▇▇▇▇▇ does not sell the Offered Shares, then ▇▇▇▇▇▇▇ may
not offer to sell any additional IBC Equity (other than the Offered Shares) for
a period of ninety (90) days from the expiration of the Applicable Acceptance
Period.
ARTICLE V REGISTRATION
Section 5.1 Demand Registration.
(a) During the term of this Agreement, upon ▇▇▇▇▇▇▇'▇ written request
specifying the intended manner of disposition (a "Demand Notice"), IBC will
use its best efforts to prepare and file with the SEC, as expeditiously as
possible, a Registration Statement on an available form for which IBC then
qualifies and which legal counsel for IBC deems appropriate and which form
is available for the sale of IBC Equity in accordance with the intended
method of distribution thereof to permit an offering of some or all of the
shares of IBC Equity then held by ▇▇▇▇▇▇▇ and use its best efforts to cause
such registration statement to become effective (a "Demand Registration");
provided, however, that with respect to proposed dispositions of IBC Equity
to shareholders of ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ and IBC will cooperate and use their
respective reasonable best efforts to obtain a "no-action letter" from the
SEC allowing such dispositions without registration.
(b) A Demand Registration will not be deemed to have occurred until
it has become effective under the Securities Act (unless ▇▇▇▇▇▇▇ delivers a
Demand Notice and subsequently withdraws the Demand Notice, in which case
such a Demand Registration will be deemed to have occurred unless ▇▇▇▇▇▇▇
agrees to pay all reasonable out-of-pocket expenses associated with such
registration actually incurred by IBC); provided, however, that if, after a
Demand Registration has become effective, the offering of IBC Equity
pursuant to such Demand Registration is prohibited by any stop-order,
injunction or other order or requirement of the SEC or other governmental
agency or court, such Demand Registration will be deemed not to have
occurred (unless such prohibition on the sale of the IBC Equity is based on
actions or omissions of ▇▇▇▇▇▇▇, in which case such a Demand Registration
will be deemed to have occurred unless ▇▇▇▇▇▇▇ agrees to pay all reasonable
out-of-pocket expenses associated with such registration actually incurred
by IBC).
(c) IBC will only be obligated to effect a total of five (5) Demand
Registrations under Section 5.1 hereof and shall not be obligated under
Section 5.1 hereof to effect more than one (1) Demand Registration in any
twelve-month period (except that
during each of the twelve-month periods commencing on the date hereof and
on the fourth anniversary of this Agreement, ▇▇▇▇▇▇▇ shall be entitled to
request up to two (2) Demand Registrations); provided, however, that IBC
will not be required to register the IBC Equity pursuant to a Demand Notice
under Section 5.1 hereof if at such time (i) the shares of IBC Equity which
▇▇▇▇▇▇▇ is requesting to be registered pursuant to Section 5.1 hereof
constitute less than five percent (5%) of such class or series of the
outstanding IBC Securities so requested to be registered or (ii) such
Demand Notice is given within six (6) months after the effective date of
any other registration of any IBC Securities under the Securities Act.
(d) If any Demand Registration involves an underwritten offering, the
first lead underwriter, and, subject to the last sentence of this Section
5.1(d), any other underwriter that will administer the offering will be
selected by ▇▇▇▇▇▇▇; provided, however, that such underwriter(s) shall be
subject to the approval of IBC which approval shall not be unreasonably
withheld. In the event there is one or more co-managers, the first such co-
manager shall be selected by IBC, provided that such co-manager shall be
subject to the approval of ▇▇▇▇▇▇▇, which approval shall not be
unreasonably withheld.
(e) If any Demand Registration involves an underwritten offering,
then as many shares of IBC Securities that IBC elects may be included in
such offering on the same terms and conditions as the IBC Equity; provided,
however, that if the managing underwriter(s) advises ▇▇▇▇▇▇▇ and IBC that,
in its judgment, the number of shares proposed to be included in such
offering should be limited, then the total number of shares to be included
in such offering will be determined by the managing underwriter(s) and IBC
shall include in such offering (i) first, all the shares of IBC Equity that
▇▇▇▇▇▇▇ proposes to sell and (ii) second all the shares of IBC Securities
that IBC proposes to sell. Except as otherwise provided for in this
Agreement or the First Registration Rights Agreement (as hereinafter
defined), no person other than ▇▇▇▇▇▇▇ shall be permitted to offer any IBC
Securities under any Demand Registration pursuant to this Section 5.1
without the prior written consent of ▇▇▇▇▇▇▇.
Section 5.2 Delay of Demand Registration.
(a) Notwithstanding anything to the contrary in Article V hereof, in
the event that IBC determines in its reasonable judgment that it may be
advisable to delay filing a Registration Statement described in Section 5.1
hereof or, to withdraw such Registration Statement if such Registration
Statement has already been filed, IBC may delay filing such, or withdraw
such previously filed, Registration Statement for a period of not more than
ninety (90) days from the date of receipt of the request for the Demand
Registration if IBC furnishes to ▇▇▇▇▇▇▇ a certificate signed by the
Chairman of the Board of IBC stating that IBC has reasonably determined
that (i) such a filing would adversely affect any proposed financing or
acquisition by IBC or (ii) such a filing would otherwise represent an undue
hardship for IBC; provided, however, that IBC will be responsible for any
reasonable out of pocket costs (excluding any decline in the IBC Market
Price) which arise out of such delay and IBC will, at the request of
▇▇▇▇▇▇▇, file or refile, as the case
may be, such Registration Statement promptly after IBC, in its judgment,
determines that it is no longer advisable to delay filing or to continue
the withdrawal of such Registration Statement.
(b) IBC may not delay filing or refiling, as the case may be, a
Registration Statement pursuant to Section 5.2(a) hereof, if following the
delay IBC would be required to file audited financial statements other than
audited financial statements included in IBC's annual report on Form 10-K,
unless IBC agrees to provide such audited financial statements.
Section 5.3 Incidental Registration.
(a) Right To Include IBC Equity.
(i) If IBC or any other Person at any time proposes to register
any IBC Securities under the Securities Act (other than a registration of
securities in connection with a merger, an acquisition, an exchange offer,
or an Employee Benefit Plan maintained by IBC or its Affiliates or on Form
S-4 or S-8 or any successor or similar form), whether or not for sale for
its own account, in a manner which would permit registration of the IBC
Equity for sale to the public under the Securities Act, it will give
written notice to ▇▇▇▇▇▇▇ (to the extent permitted by such other Person's
current contractual registration rights, if any) of its intention to do so
and of ▇▇▇▇▇▇▇'▇ rights under this Section 5.3(a)(i), at least thirty (30)
calendar days prior to the anticipated filing date of a Registration
Statement relating to such registration (an "Incidental Notice"). Such
Incidental Notice will offer ▇▇▇▇▇▇▇ the opportunity to include in such
Registration Statement that number of shares of IBC Equity as ▇▇▇▇▇▇▇ may
request. Upon the written request (which request will specify the number of
shares of IBC Equity intended to be disposed of by ▇▇▇▇▇▇▇ pursuant to such
Registration Statement) of ▇▇▇▇▇▇▇ made within ten (10) calendar days after
the receipt of the Incidental Notice, IBC will use its best efforts to
effect the registration under the Securities Act of all shares of IBC
Equity which IBC has been so requested to register; provided, however, that
(A) if such registration involves an underwritten offering, ▇▇▇▇▇▇▇ must
sell its IBC Equity requested to be included in such registration to the
underwriter(s) selected by IBC on the same terms and conditions as apply to
other Persons, including IBC, and (B) if, at any time after receiving a
reply from ▇▇▇▇▇▇▇ to an Incidental Notice, and prior to the effective date
of the Registration Statement filed in connection with such registration,
IBC decides for any reason not to register any shares of IBC Securities,
IBC will notify ▇▇▇▇▇▇▇ and thereupon be relieved of its obligation to
register any IBC Equity in connection with such registration.
(ii) No registration, whether or not effected under Section
5.3(a) hereof will relieve IBC of its obligations to effect Demand
Registrations under Section 5.1 hereof.
(b) Priority in Incidental Registrations. If a registration pursuant
to Section 5.3(a) hereof involves an underwritten offering and the managing
underwriter advises
IBC in writing, that, in its opinion, the number of IBC Securities intended
to be included in such Registration Statement exceeds the largest number of
IBC Securities which can be sold without having an adverse effect on such
offering, including the price at which such securities can be sold or, if
in a non-underwritten offering, IBC determines, in its reasonable
discretion, to limit the number of securities to be sold, (in either case,
the "Marketable Number"), IBC will include in such Registration Statement
(i) first, all of the IBC Securities IBC or the Person referred to in the
first sentence of Section 5.3(a)(i) proposes to sell for its own account,
(ii) second, all of the IBC Securities requested to be included by holders
of IBC Securities pursuant to Section 3 of the First Registration Rights
Agreement, (iii) third, the IBC Securities requested to be included by
▇▇▇▇▇▇▇ pursuant to Section 5.3(a) hereof and (iv) fourth, the securities
requested to be included by other Persons (but if the number of securities
to be registered pursuant to clause (iv) together with the number of
securities to be included in such registration pursuant to clauses (i),
(ii) and (iii) of this Section 5.3(b) exceeds the Marketable Number, the
number of securities of Persons to be registered pursuant to clause (iv)
shall be allocated pro rata among such Persons on the basis of the relative
number of IBC Securities each such Person has requested to be included in
such registration).
Section 5.4 Delay of Incidental Registration. Notwithstanding anything
to the contrary in this Article V, in the event that IBC determines in its
reasonable judgment that it may be advisable to delay filing a Registration
Statement described in Section 5.3 hereof or, to withdraw such Registration
Statement if such Registration Statement has already been filed, IBC may delay
filing such, or withdraw such previously filed, Registration Statement in
accordance with the provisions of Section 5.3(a)(i) hereof.
Section 5.5 Third Party Registration Rights. The provisions of this
Article V are in all cases subject to the contractual registration rights
granted by that certain Registration Rights Agreement dated July 23, 1991 (the
"First Registration Rights Agreement") by and among IBC, Mezzanine Investment
Limited Partnership-8, 1987 Merchant Investment Partnership, Merchant LBO Inc.
and GKB IX, L.P. IBC hereby represents and warrants that the First Registration
Rights Agreement is the only agreement entered into by IBC or any of its
Associates or Affiliates governing the registration of shares of IBC Securities.
IBC will not extend, amend or waive any provisions of the First Registration
Rights Agreement and will not grant any additional registration rights to any
other Person which could limit or restrict the registration rights granted
▇▇▇▇▇▇▇ pursuant to this Agreement.
ARTICLE VI REGISTRATION EXPENSES
Section 6.1 Registration Expenses.
(a) Subject to Section 5.1(b) of this Agreement, all expenses
incident to IBC's performance of or compliance with Articles V and VII of
this Agreement to effect five (5) Demand Registrations will be borne by
IBC, including, without limitation:
(i) all federal registration and filing fees;
(ii) subject to Section 7.4, fees and expenses of compliance
with securities or blue sky laws; provided, however, that IBC will in no
event be obligated to pay the fees and disbursements of counsel for the
underwriters or ▇▇▇▇▇▇▇ in connection with blue sky qualifications of the
IBC Equity under the laws of such jurisdictions as the managing
underwriter(s) may designate;
(iii) printing, messenger, telephone and delivery expenses;
(iv) fees and disbursements of legal counsel for IBC;
(v) fees and disbursements of all independent certified public
accountants of IBC;
(vi) NASD fees and disbursements of the underwriters; provided,
however, that in all cases ▇▇▇▇▇▇▇ will pay all costs of discounts,
commissions, spreads or fees of underwriters, selling brokers, dealer
managers or similar securities industry professionals relating to the
distribution of the IBC Equity being sold by ▇▇▇▇▇▇▇;
(vii) fees and expenses of other Persons retained by IBC; and
(viii) listing or quotation fees and expenses required to be made
pursuant to Section 7.6 hereof in connection with the Registration
Statement.
(b) Each of IBC and ▇▇▇▇▇▇▇ will pay its own internal expenses
(including, without limitation, all salaries and expenses of its officers
and employees performing legal or accounting duties), the expenses of its
annual audit, rating agency fees and fees and expenses of any Person,
including special experts retained by IBC or ▇▇▇▇▇▇▇, respectively.
ARTICLE VII REGISTRATION PROCEDURE
Section 7.1 ▇▇▇▇▇▇▇ Information. ▇▇▇▇▇▇▇ will provide IBC with such
information about ▇▇▇▇▇▇▇ and the intended manner of distribution of IBC Equity
and otherwise cooperate with IBC and the underwriter(s) as may be necessary in
the reasonable opinion of IBC to satisfy any obligation of IBC under this
Agreement to register the IBC Equity under federal or state securities laws and
otherwise take actions related thereto. In the event of the failure of ▇▇▇▇▇▇▇
to comply with the requirements of the preceding sentence IBC may delay filing
such, and withdraw such previously filed, Registration Statement. IBC will file
or refile, as the case may be, such Registration Statement promptly following
compliance with such requirements by ▇▇▇▇▇▇▇; provided, however, that ▇▇▇▇▇▇▇
will be responsible for any reasonable out of pocket costs which arise out of
such non-compliance. ▇▇▇▇▇▇▇ will immediately notify IBC upon discovery that
any information provided by ▇▇▇▇▇▇▇ which is included in the prospectus that is
included in a Registration Statement, as then in effect, is untrue in any
material respect, or omits to state any material fact required to be stated
therein or to make the information stated therein not misleading in the light of
the circumstances under which it is presented.
Section 7.2 Compliance. Each of ▇▇▇▇▇▇▇ and IBC will comply with all
rules and regulations of the SEC and applicable state securities or blue sky
laws governing the manner of sale of securities in connection with its Transfer
of any of the IBC Equity pursuant to any Registration Statement.
Section 7.3 Provision of Prospectuses.
(a) IBC will furnish to ▇▇▇▇▇▇▇ such number of copies of a summary
prospectus or other prospectus, including a prospectus subject to
completion in conformity with the requirements of the Securities Act, and
such other documents as ▇▇▇▇▇▇▇ may reasonably request in writing, in order
to facilitate the public sale or other disposition of the IBC Equity
included in a Registration Statement.
(b) At any time when a sale or other disposition of IBC Equity
pursuant to a Registration Statement is subject to a prospectus delivery
requirement, IBC will notify ▇▇▇▇▇▇▇ of the occurrence of any event that
causes the prospectus included in such Registration Statement, as then in
effect, to include an untrue statement of a material fact or to omit to
state a material fact required to be stated therein or necessary to make
the statements therein not misleading in the light of the circumstances
then existing and IBC will use its best efforts, as expeditiously as
possible, to either amend the prospectus or otherwise take any actions so
that use of the previous prospectus may be legally resumed. Upon receipt of
such a notice, ▇▇▇▇▇▇▇ will immediately discontinue all sales or other
dispositions of IBC Equity pursuant to the Registration Statement. ▇▇▇▇▇▇▇
may resume such sales or dispositions only upon receipt of an amended
prospectus or after ▇▇▇▇▇▇▇ is advised by IBC that the use of the previous
prospectus may be legally resumed.
Section 7.4 Blue Sky Compliance. IBC will use its best efforts to (a)
register or qualify the IBC Equity included in a Registration Statement under
the securities or blue sky laws of such jurisdictions within the United States
as ▇▇▇▇▇▇▇ reasonably requests and (b) do any and all other acts that may be
reasonably necessary or advisable to enable ▇▇▇▇▇▇▇ to consummate the public
sale or disposition of such securities in such jurisdictions; provided, however,
that IBC is not required to consent to, or take any action that would subject it
to, general service of process or taxation in any jurisdiction where it is not
then so subject, nor qualify to do business in any jurisdiction where it is not
then so qualified.
Section 7.5 Maintenance of Effectiveness. IBC will use its best efforts
to prepare and file promptly with the SEC such amendments and supplements to any
Registration Statement, and the prospectus used in connection therewith, as may
be necessary to keep such Registration Statement continuously effective and in
compliance with the Securities Act until the one hundred twentieth (120th) day
following the date on which such Registration Statement becomes effective, or
until all IBC Equity included in such Registration Statement has been sold,
whichever is earlier; provided, however, that IBC will have no obligation under
this Section 7.5 to keep effective any Registration Statement during the period
following any date on which IBC would be required to file audited financial
statements other than the date by which IBC is required to file its next annual
report on Form 10-K containing such required audited financial statements.
Section 7.6 Listing of IBC Equity. IBC will use its best efforts to
cause the IBC Equity when issued to be listed on all securities exchanges on
which any securities issued by IBC are then listed, or quoted on all automated
quotation systems on which any such securities of IBC are then quoted,
including, without limitation, entering into appropriate customary agreements
(including a listing application and indemnification agreement in customary
form).
Section 7.7 Stop-Orders. IBC will promptly notify ▇▇▇▇▇▇▇ of (a) the
receipt by IBC of any notification with respect to the issuance by the SEC of
any stop-order or order suspending the effectiveness of any Registration
Statement covering any IBC Equity or the initiation of any proceedings for that
purpose, or (b) the receipt by IBC of any notification with respect to the
limitation, restriction or suspension of the offer or sale of IBC Equity in any
jurisdiction in which the IBC Equity was qualified to be sold, or the initiation
of any proceedings for such purpose. In the event that IBC notifies ▇▇▇▇▇▇▇ of
any such event, ▇▇▇▇▇▇▇ will immediately discontinue all sales or other
dispositions of IBC Equity pursuant to the Registration Statement until such
time that IBC notifies ▇▇▇▇▇▇▇ of the lifting of such stop-order or similar
order; provided, however, that such a stop-order or similar order issued by a
state securities or blue sky administrator will apply only to offers and sales
in such state, unless ▇▇▇▇▇▇▇ is advised otherwise by IBC. IBC, with the
cooperation of ▇▇▇▇▇▇▇, will use its best efforts to contest any such
proceedings and to obtain the withdrawal of any such order at the earliest
possible date.
ARTICLE VIII INDEMNIFICATION AND CONTRIBUTION
Section 8.1 Indemnification.
(a) Indemnification by ▇▇▇▇▇▇▇.
(i) ▇▇▇▇▇▇▇ agrees to indemnify and hold harmless IBC, its
Affiliates and Associates (each such Person being hereinafter referred to
as an "IBC Indemnified Party") from and against all losses, claims,
damages, liabilities and expenses (including reasonable costs of
investigation and legal expenses) (each a "Loss") arising out of or based
upon any untrue statement or alleged untrue statement of a material fact
contained in any Registration Statement or preliminary, final or summary
prospectus covering any IBC Equity, or in any amendment or supplement
thereto, or in any document incorporated by reference into any of the
foregoing or arising out of or based upon any omission or alleged omission
to state therein a material fact required to be stated therein or necessary
to make the statements therein not misleading, but only if, and only to the
extent, such statement or alleged statement or omission or alleged omission
was made in reliance upon and in conformity with written information
furnished to IBC or its
representatives by or on behalf of ▇▇▇▇▇▇▇ for use in the preparation of
such Registration Statement, preliminary, final or summary prospectus or
such amendment or supplement thereto, or such document incorporated by
reference. This indemnity will be in addition to any liability which
▇▇▇▇▇▇▇ may otherwise have. ▇▇▇▇▇▇▇ will also indemnify the underwriter(s),
selling broker(s), dealer manager(s) and similar securities industry
professionals participating in the distribution, their officers and
directors and each Person who Controls such Persons, to the same extent as
provided above with respect to the indemnification of the IBC Indemnified
Party.
(ii) ▇▇▇▇▇▇▇ also agrees to indemnify and hold harmless any IBC
Indemnified Party from and against all Losses arising out of any action or
proceeding brought against any IBC Indemnified Party in connection with the
distribution or proposed distribution of IBC Equity to the holders of RAL
Stock; provided, however, that this Section 8.1(a)(ii) shall not apply to
any Losses for which IBC is responsible as provided in Section 8.1(b) of
this Agreement.
(iii) If any action or proceeding (including any governmental
investigation or inquiry) is brought or asserted against an IBC Indemnified
Party in respect of which indemnity may be sought from ▇▇▇▇▇▇▇, such IBC
Indemnified Party will promptly notify ▇▇▇▇▇▇▇ in writing of the
commencement of such action and ▇▇▇▇▇▇▇ shall assume the defense thereof
and have primary control over any related suit or proceeding, including the
employment of legal counsel and the payment of all expenses in connection
therewith; provided, however, that the failure of any IBC Indemnified Party
to give notice as provided herein shall not relieve ▇▇▇▇▇▇▇ of its
obligations under this Section 8.1(a) except to the extent that ▇▇▇▇▇▇▇ is
actually materially prejudiced by such failure to give notice. An IBC
Indemnified Party shall have the right to participate in and jointly with
▇▇▇▇▇▇▇, to the extent that it may wish, and employ separate counsel
reasonably satisfactory to such IBC Indemnified Party, provided, however,
that ▇▇▇▇▇▇▇ will not be liable to such IBC Indemnified Party for any legal
or other expenses subsequently incurred by such IBC Indemnified Party in
connection therewith, unless such IBC Indemnified Party shall have been
advised by counsel that a conflict of interest between such IBC Indemnified
Party and ▇▇▇▇▇▇▇ is likely to exist in respect of such claim.
(b) Indemnification by IBC.
(i) IBC agrees to indemnify and hold harmless ▇▇▇▇▇▇▇ and its
Affiliates and Associates (each such person being hereinafter referred to
as a "▇▇▇▇▇▇▇ Indemnified Party") from and against all Losses arising out
of or based upon any untrue statement or alleged untrue statement of a
material fact contained in any Registration Statement, preliminary, final
or summary prospectus covering any IBC Equity, or in any amendment or
supplement thereto, or in any document incorporated by reference into any
of the foregoing or arising out of or based upon any omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statement therein not misleading, except insofar as
such Losses arise out of or are based solely upon
any such untrue statement or omission or allegation thereof based upon
written information provided by or on behalf of ▇▇▇▇▇▇▇ for inclusion in
such Registration Statement, preliminary, final or summary prospectus, or
such amendment or supplement thereto, or such document incorporated by
reference; provided, however, that IBC will not be liable in any such case
to the extent that any such Loss arises out of or is based upon an untrue
statement or alleged untrue statement or omission or alleged omission made
in any preliminary prospectus if (A) ▇▇▇▇▇▇▇ failed to send or deliver a
copy of the final prospectus with or prior to the delivery of written
confirmation of the sale of the IBC Equity covered by the Registration
Statement to the Person asserting such Loss, and (B) the final prospectus
would have corrected such untrue statement or omission and provided,
further, that IBC will not be liable in any such case to the extent that
any such Loss arises out of or is based upon an untrue statement or
omission in the final prospectus, if such untrue statement or omission is
corrected in an amendment or supplement to the final prospectus and if,
having previously been furnished by or on behalf of IBC with copies of the
final prospectus as so amended or supplemented, ▇▇▇▇▇▇▇ thereafter fails to
deliver such prospectus as so amended or supplemented, prior to or
concurrently with the sale of the IBC Equity to the Person asserting such
Loss who purchased such IBC Equity which is the subject thereof. This
indemnity will be in addition to any liability which IBC may otherwise
have. IBC will also indemnify the underwriter(s), selling broker(s), dealer
manager(s) and similar securities industry professionals participating in
the distribution, their officers and directors and each Person who Controls
such Persons, to the same extent as provided above with respect to the
indemnification of the ▇▇▇▇▇▇▇ Indemnified Party.
(ii) If any action or proceeding is brought against a ▇▇▇▇▇▇▇
Indemnified Party in respect of which indemnity may be sought against such
▇▇▇▇▇▇▇ Indemnified Party, ▇▇▇▇▇▇▇ will promptly notify IBC in writing of
the commencement of such action and IBC will assume the defense thereof and
have primary control over any related suit or proceeding, including the
employment of legal counsel and the payment of all expenses in connection
therewith; provided, however, that the failure of any ▇▇▇▇▇▇▇ Indemnified
Party to give notice as provided herein shall not relieve IBC of its
obligations under this Section 8.1(b) except to the extent that IBC is
actually materially prejudiced by such failure to give notice. A ▇▇▇▇▇▇▇
Indemnified Party shall have the right to participate in and jointly with
IBC, to the extent that it may wish, and employ separate counsel reasonably
satisfactory to such ▇▇▇▇▇▇▇ Indemnified Party, provided, however, that IBC
will not be liable to such ▇▇▇▇▇▇▇ Indemnified Party for any legal or other
expenses subsequently incurred by such ▇▇▇▇▇▇▇ Indemnified Party in
connection therewith, unless such ▇▇▇▇▇▇▇ Indemnified Party shall have been
advised by counsel that a conflict of interest between such ▇▇▇▇▇▇▇
Indemnified and IBC is likely to exist in respect of such claim.
Section 8.2 Contribution.
(a) If the indemnification provided for in Section 8.1 hereof is
unavailable to an IBC Indemnified Party or ▇▇▇▇▇▇▇ Indemnified Party under
Section 8.1(a) or Section
8.1(b) hereof (other than by reason of the exceptions provided in Sections
8.1(a) and 8.1(b)) in respect of any Losses referred to therein, then such
indemnifying party, in lieu of indemnifying such indemnified party, will
contribute to the amount paid or payable by such indemnified party as a
result of such Losses in such proportion as is appropriate to reflect the
relative fault of the indemnifying party, on the one hand, and the
indemnified party, on the other hand, in connection with the statements or
omissions which resulted in such Losses, as well as any other relevant
equitable considerations. The relative fault of the indemnifying party, on
the one hand, and the indemnified party, on the other hand, shall be
determined by reference to, among other things, whether the untrue
statement or alleged untrue statement of a material fact or the omission or
alleged omission to state a material fact relates to information supplied
by such indemnified party and each parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such statement
or omission. The amount paid or payable by each party as a result of the
Losses referred to above will be deemed to include, subject to the
limitations set forth in Section 8.1(b) hereof, any legal or other fees or
expenses reasonably incurred by such party in connection with investigating
or defending any action or claim.
(b) Notwithstanding the provisions of Section 8.2(a) hereof, no
Person found to be guilty of fraudulent misrepresentation shall be entitled
to contribution from any Person who is not found to be guilty of such
fraudulent misrepresentation.
ARTICLE IX CALL RIGHTS
Section 9.1 IBC Call.
(a) At any time during the one-year period commencing on the fifth
anniversary date of this Agreement, IBC shall have the right to acquire
all, but not less than all of the IBC Equity then owned by ▇▇▇▇▇▇▇ at a
purchase price equal to one-hundred and ten percent (110%) of the IBC
Market Price of the IBC Equity then owned by ▇▇▇▇▇▇▇ (such right to acquire
the IBC Equity is referred to as the "IBC Call"). IBC will notify ▇▇▇▇▇▇▇
of its election to exercise the IBC Call (a "Call Notice"), which Call
Notice will contain IBC's notice of election to purchase such shares
subject to the IBC Call, the purchase price of the shares subject to the
IBC Call calculated in accordance with this Section 9.1(a), and the date
estimated for consummation of the purchase and sale (not more than thirty
(30) days after the date of the Call Notice). The consummation of the
purchase and sale pursuant to this Section 9.1(a) will take place no later
than thirty (30) days after the date specified in the Call Notice, subject
to the provisions of Section 9.1(b) hereof and subject to any and all
waiting periods required under any applicable laws or regulations. IBC may
assign the right to purchase such shares subject to the IBC Call to any
Person. Any rights to IBC Equity arising pursuant to an IBC Call shall
continue in effect during the term hereof unless extinguished by IBC
pursuant to a written notice to ▇▇▇▇▇▇▇ affirmatively relinquishing such
rights. IBC shall be permitted to relinquish rights to acquire all of the
IBC Equity subject to an IBC Call.
(b) Upon the consummation of a purchase and sale pursuant to Section
9.1(a) hereof:
(i) ▇▇▇▇▇▇▇ will transfer and deliver to IBC, all of its right,
title and interest in and to the IBC Equity then owned by ▇▇▇▇▇▇▇, free and
clear of all liens and encumbrances and will deliver to IBC a
certificate(s) evidencing the shares sold duly endorsed, or accompanied by
written instruments of transfer in form satisfactory to IBC, duly executed,
with evidence of payment of any applicable stock transfer taxes.
(ii) IBC or its assignee will deliver to ▇▇▇▇▇▇▇ an amount in
cash equal to the purchase price of the IBC Equity then owned by ▇▇▇▇▇▇▇ as
set forth in the IBC Call.
(c) The IBC Call shall be exercised within one (1) year following the
expiration of the fifth anniversary date of this Agreement, and shall
expire if not exercised by such date.
ARTICLE X ADDITIONAL COVENANTS
Section 10.1 Maintain Listing or Quotation. IBC hereby covenants and
agrees that it shall use its best efforts to maintain its listing of IBC
Securities on any securities exchanges on which its IBC Securities are currently
listed or on which they are listed in the future pursuant to Section 7.6 hereof
and to maintain its quotation of IBC Securities on an any automated quotation
systems on which its IBC Securities are currently quoted or on which they are
quoted in the future pursuant to Section 7.6 hereto.
Section 10.2 Board of Directors. IBC hereby covenants and agrees that (a)
effective as of the Closing, IBC shall nominate and appoint ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
and ▇▇. ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ to the board of directors of IBC, one to hold office
until the 1996 annual meeting of IBC shareholders and one to hold office until
the 1997 annual meeting of IBC shareholders, and (b) the nominee chosen by
▇▇▇▇▇▇▇ to serve in the 1996 class shall be nominated and elected to an
additional term of not less than two years at the 1996 annual meeting of IBC
shareholders. There will be no obligation of IBC under the terms of this
Agreement to nominate any ▇▇▇▇▇▇▇ representatives after such terms expire.
Section 10.3 No Inconsistent Agreements. IBC hereby covenants and agrees
that it shall not enter into any agreements governing the transfer or
registration of shares of IBC Securities which would adversely effect ▇▇▇▇▇▇▇'▇
rights under this Agreement, without ▇▇▇▇▇▇▇'▇ prior written consent.
Section 10.4 Preferred Stock. IBC hereby covenants and agrees that during
the term of this Agreement, so long as ▇▇▇▇▇▇▇ owns at least 15% of the IBC
Securities, IBC shall not issue to any Person any shares of preferred stock of
IBC which possess voting rights which are greater than the equity interest
represented by such shares of preferred stock of IBC.
Section 10.5 Rule 144 and 144A. IBC hereby covenants and agrees that it
will use its reasonable best efforts to file any reports required to be filed by
it under the Securities Act and Exchange Act and that it will take such further
action as ▇▇▇▇▇▇▇ may reasonably request, all to the extent required from time
to time to enable ▇▇▇▇▇▇▇ to sell its IBC Equity (subject to the terms hereof)
without registration under the Securities Act within the limitation of the
exemptions provided by (a) Rule 144 or 144A under the Securities Act, as such
Rules may be amended from time to time, or (b) any similar rule or regulation
hereafter adopted by the Commission.
Section 10.6 Maximum Allowed Ownership of IBC Securities. ▇▇▇▇▇▇▇ hereby
covenants and agrees that on the fifth anniversary of the date of this Agreement
its ownership of IBC Securities shall be no more than 14.9% of the total
outstanding IBC Securities.
ARTICLE XI MISCELLANEOUS
Section 11.1 Entire Agreement. This Agreement, constitutes the entire
agreement between the parties hereto relative to the subject matter hereof, and
supersedes all prior written or oral understandings, agreements, conditions or
representations.
Section 11.2 Headings and Captions. All headings and captions used in
this Agreement are for convenience only, and will not be construed to either
limit or broaden the language of this Agreement or any particular section.
Section 11.3 Choice of Law. This Agreement will be governed by and
construed under and in accordance with the laws of the State of Missouri,
without giving effect to the conflict of laws provisions thereof, except that
all matters relating to the internal affairs of IBC shall be governed by and
construed under and in accordance with the General Corporation Law of Delaware.
Section 11.4 Venue. Any action or legal proceedings to enforce this
Agreement or any of its terms, or for indemnification and the recovery of losses
as provided for in this Agreement by a party, may be brought and prosecuted in
such court or courts located in the Eastern or Western District of Missouri as
provided by law, and the parties to this Agreement consent to the jurisdiction
of said court or courts and to service of process by registered mail, return
receipt requested, or by any other manner provided by Missouri law.
Section 11.5 Notices. Any notice or other communication required or
permitted hereunder is deemed delivered when delivered in person, when
transmitted by telecopier (which will also be sent concurrently by certified or
registered mail), on the next Business Day when sent by Federal Express or a
similar overnight delivery service, or on the third Business Day when sent by
registered or certified U.S. mail service as follows:
If to ▇▇▇▇▇▇▇ or VCS: Office of the Chief Executive Officer
▇▇▇▇▇▇▇ Purina Company
▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇. ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
With a Copy to: Office of the General Counsel
▇▇▇▇▇▇▇ Purina Company
▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇. ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
If to IBC: Office of the Chief Executive Officer
Interstate Bakeries Company
▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
With Copies to: Office of the General Counsel
Interstate Bakeries Company
▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: Ray ▇▇▇▇▇ ▇▇▇▇▇▇, Esq.
Shook, Hardy & Bacon P.C.
One Kansas City Place
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
The parties to this Agreement will promptly notify each other in the manner
provided in this Section 11.5 of any change in their respective addresses. A
notice of change of address will not be deemed to have been given until received
by the addressee.
Section 11.6 Amendments. No changes, modifications, amendments or
additions will be valid unless such be made in writing and signed by or on
behalf of each party.
Section 11.7 Extended Meanings. Words importing the singular number
include the plural and vice versa, and words importing the masculine gender
include the feminine and neuter genders.
Section 11.8 Assignments. In addition to the specific assignment rights
set forth herein, IBC has the right to assign any and all of its rights or
obligations under this Agreement to the surviving entity in a merger,
consolidation, combination or other corporate transaction involving IBC which
agrees in writing with ▇▇▇▇▇▇▇ to be bound by the terms hereof. Except as
otherwise provided herein, ▇▇▇▇▇▇▇ may not assign any of its rights or
obligations hereunder to any Person.
Section 11.9 Severability. The invalidity or unenforceability of any
provision hereof in any jurisdiction will not affect the validity or
enforceability of this Agreement, including that provision, in any other
jurisdiction. To the extent permitted by applicable law, each party waives any
provision of law that renders any provision hereof prohibited or unenforceable
in any respect. If any term, provision, covenant or restriction in this
Agreement is held by a court of competent jurisdiction to be invalid, void or
unenforceable, the parties hereto will use their best efforts to find and employ
an alternative means to achieve the same or substantially the same result as
that contemplated by such term, provision, covenant or restriction and the
remainder of the terms, provisions, covenants and restrictions set forth herein
shall remain in full force and effect, in order to achieve the intent of the
parties to the extent possible.
Section 11.10 Counterparts. This Agreement may be executed simultaneously
in two or more counterparts, each of which is deemed an original, but all of
which together constitutes a single agreement, and it is not necessary in making
proof of this Agreement to produce or account for more than one such
counterpart.
Section 11.11 Remedies Cumulative. Except as otherwise expressly limited
herein, the remedies given to any party by this Agreement are in addition to all
remedies under any statute or rule of law. Any forbearance or failure or delay
in exercising any remedy hereunder is not deemed to be a waiver of any other
remedy a party may have under this Agreement.
Section 11.12 Binding Agreement. This Agreement will be deemed effective
and legally binding upon the parties when it has been executed and delivered by
all parties hereto. This Agreement will inure to the benefit of the parties
hereto and their permitted successors and assignees.
Section 11.13 Recapitalizations, Exchanges, Etc., Affecting IBC Securities.
The provisions of this Agreement apply to the full extent set forth herein with
respect to the IBC Equity, to any and all shares of capital stock of IBC or any
successor or assign of IBC (whether by merger, consolidation, sale of assets, or
otherwise) which may be issued in respect of, in exchange for, or in
substitution of, IBC Equity and will be appropriately adjusted for any stock
dividends, splits, reverse splits, combinations, recapitalizations and the like
occurring after the date hereof.
Section 11.14 Other Agreements. Nothing contained in this Agreement will
be deemed to be a waiver of, or release from, any obligations any party hereto
may have under any other agreement, including, without limitation, the Purchase
Agreement.
Section 11.15 Term; Effectiveness. The term of this Agreement will begin
(and this Agreement will become effective) upon the date hereof and will
continue until the date which is five (5) years from the date hereof; provided,
however, that Article IX and Section 2.1 shall survive until the date which is
six (6) years from the date hereof. The provisions of Articles VI and VIII
hereof shall survive the termination of this Agreement.
Section 11.16 Enforcement. Each of IBC and ▇▇▇▇▇▇▇ agrees that any breach
of the provisions contained in this Agreement by IBC and/or ▇▇▇▇▇▇▇ would cause
irreparable harm to the other and its Affiliates and, therefore, notwithstanding
any right of IBC and/or ▇▇▇▇▇▇▇ to recover monetary damages with respect to any
such breach as set forth in (a) this Agreement or (b) at law, IBC and ▇▇▇▇▇▇▇
will each be entitled to equitable relief to enjoin any threatened or continuing
breach of the other hereof and, in the event of any action for specific
performance, each party shall waive the defense that a remedy at law would be
adequate. If the scope of any restriction contained in this Agreement is too
broad to permit enforcement to its full extent, then such restriction will be
enforced to the maximum extent permitted by law in the manner provided in
Section 11.9 hereof. Nothing herein stated will be construed as prohibiting any
party from pursuing any other remedies available to that party for a breach
hereunder, including recovery of damages.
Section 11.17 Confidentiality. Each of ▇▇▇▇▇▇▇ and IBC acknowledges that
the other would be irreparably damaged if confidential knowledge of its business
and affairs were disclosed or utilized on behalf of any Person. Each of IBC and
▇▇▇▇▇▇▇ covenants and agrees not to disclose or use any such confidential
information of the other unless such information has been made available to the
public generally (other than in violation of this Section 11.17) or IBC and/or
▇▇▇▇▇▇▇ is required to disclose such information by a governmental body or
regulatory agency or by law in connection with a transaction that is not
otherwise prohibited hereby. Performance by IBC and ▇▇▇▇▇▇▇ of their respective
obligations under this Section 11.17 shall be in accordance with the provisions
set forth on Exhibit A attached hereto, which Exhibit is incorporated herein and
made a part hereof.
Section 11.18 Fiduciary Accounts. IBC and ▇▇▇▇▇▇▇ each acknowledge and
agree that this Agreement shall apply only to the IBC Securities owned by
▇▇▇▇▇▇▇ for its own account and does not apply to any IBC Securities which may
be deemed to be beneficially owned or controlled by ▇▇▇▇▇▇▇ or its Affiliates
and which shares are held in fiduciary accounts in connection with any pension
plans, profit sharing plans or other employee benefit plans or held in any other
fiduciary accounts.
IN WITNESS WHEREOF, the parties have executed this Agreement by an
officer thereunto duly authorized, all as of the day and year first above
written.
ATTEST: INTERSTATE BAKERIES
CORPORATION
/s/ ▇. ▇. ▇▇▇▇▇▇ /s/ ▇. ▇. ▇▇▇▇▇▇
___________________________ _________________________________
By: ▇. ▇. ▇▇▇▇▇▇ By: ▇. ▇. ▇▇▇▇▇▇
Its Secretary Its Vice President
ATTEST: ▇▇▇▇▇▇▇ PURINA COMPANY, on its
behalf and on behalf of its Affiliates
/s/ N. E. ▇▇▇▇▇▇▇▇ /s/ ▇. ▇. ▇▇▇▇▇▇▇
_____________________________ _______________________________
By: N. E. ▇▇▇▇▇▇▇▇ By: ▇. ▇. ▇▇▇▇▇▇▇
Its Assistant Secretary Its Vice President
ATTEST: VCS HOLDING COMPANY
/s/ N. E. ▇▇▇▇▇▇▇▇ /s/ ▇. ▇. ▇▇▇▇▇▇
_____________________________ _______________________________
By: N. E. ▇▇▇▇▇▇▇▇ By: ▇. ▇. ▇▇▇▇▇▇
Its Assistant Secretary Its Secretary
EXHIBIT A
For purposes of Section 11.17 of the Shareholder Agreement by and among
Interstate Bakeries Corporation, ▇▇▇▇▇▇▇ Purina Company and VCS Holding Company,
the following provisions shall apply:
1. "Confidential Information" shall include all information provided
heretofore or hereafter by either ▇▇▇▇▇▇▇ or IBC (individually, a "Company" and
collectively, the "Companies") or their representatives, Affiliates, advisors,
officers, directors, employees or agents ("Representatives"), to the other. The
term "Confidential Information" also will include any analyses, studies or other
documents prepared by Representatives of a Company containing or based in whole
or in part on any information furnished to the other. Confidential Information
shall not include information which (i) becomes generally available to the
public other than as a result of a disclosure in violation hereof by a Company
or its Representatives, (ii) was in the possession of a Company on a non-
confidential basis prior to its disclosure or (iii) becomes available to a
Company on a non-confidential basis from a source other than the other Company,
which source is entitled to make the disclosure without violation of any
obligation of confidentiality to a Company or other party.
2. Each Company recognizes and acknowledges the competitive value and the
confidential and proprietary nature of the Confidential Information and the
damage that could result to the other Company if information contained therein
is disclosed to any third party. Each Company agrees that it will not use the
Confidential Information in any manner that is competitive with or detrimental
to the business or operations of the other Company. Each Company further agrees
that it will not disclose any of the Confidential Information to any
person or entity without the prior written consent of the other Company;
provided, however, that there may be a disclosure of such information to such of
its Representatives that need to know such information in connection with any
transactions between the Companies or for valid business reasons which do not
otherwise violate the provisions of this agreement. Each Company acknowledges
that its Representatives are bound hereto to the same extent as each Company as
if there were parties hereto, and each Company shall be responsible for any
breach hereof by any of its Representatives.
3. Each Company agrees that a breach of the provisions hereof may give
rise to irreparable injury to the other Company that cannot be compensated for
adequately by monetary damages. Consequently, each Company shall be entitled
from the other Company, in addition to all other remedies available, to
injunctive and other equitable relief to prevent a breach hereof and to secure
the enforcement hereof in any court of competent jurisdiction in the United
States or any state thereof.
4. Each Company hereby acknowledges that it is aware, and will advise its
Representatives and financing sources who are informed as to the matters which
are the subject hereof, that the federal and state securities law prohibit any
person who has received material, non-public information concerning the matters
that are related hereto from purchasing or selling securities of the Companies
or from communicating such information to any other person under circumstances
in which it is reasonably foreseeable that such person is likely to purchase or
sell such securities.
5. If either Company is requested or becomes legally compelled to disclose
any of the Confidential Information, such Company agrees that it will provide
the other Company with prompt written notice of such request so that the other
Company may seek a protective order. In the event that such protective order or
other remedy is not obtained, the Company agrees to furnish only that portion of
the Confidential Information and other information that it is legally obligated
to disclose.
6. At either Company's request, the other agrees to promptly return or, at
such Company's option, to destroy the Confidential Information and all copies
thereof. All copies, extracts or other reproductions in whole or in part
thereof shall be destroyed and not retained by the other Company or its
representatives in any form or for any reason, and such destruction shall be
certified in writing to the requesting Company by an authorized officer
supervising such destruction. All documents, pleadings, court filings,
memoranda, notes and other writings whatsoever prepared by the other Company or
its representatives based on the Confidential Information (except, in the case
of pleadings and court filings, to the extent reasonably required for proper
record keeping purposes) shall be destroyed, and such destruction shall be
certified in writing to the requesting Company by an authorized officer
supervising such destruction.
7. If any provision hereof or the application of any such provision to any
person or circumstance is held invalid, illegal or unenforceable for any reason
whatsoever, the remaining provisions and the application of such provision to
other persons or circumstances shall not be affected thereby. To the fullest
extent possible the court finding such provision invalid, illegal or
unenforceable shall modify and construe the provisions as to render it valid and
enforceable as against all persons or entities and to give the maximum possible
protection to each of the Companies and their Representatives within the bounds
of validity, legality and enforceability.
8. The provisions hereof shall continue in effect throughout the term of
the Shareholder Agreement.