STOCKHOLDERS AGREEMENT
This Agreement is made as of April 29, 2004 by and among ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇ & Company, Inc., a Connecticut corporation ("▇▇▇▇▇▇▇▇▇ Company" and
together with any transferee to whom it transfers Shares, as hereinafter
defined, to the extent of the Shares so transferred, collectively, the
"▇▇▇▇▇▇▇▇▇ Stockholders"), Palisade Investors LLC, a New Jersey limited
liability company ("Palisade"), ▇▇▇▇▇▇ Industries, Inc., a Florida corporation
("▇▇▇▇▇▇ Industries" and, together with Palisade and any transferees to whom
Palisade or the ▇▇▇▇▇▇ Industries transfers Shares, to the extent of the Shares
so transferred, collectively, the "Palisade/▇▇▇▇▇▇ Stockholders"), and ▇▇▇▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇ and ▇▇▇▇▇▇ ▇▇▇▇▇ (the "Banks Family" and together with any
transferees to whom any of them transfers Shares to the extent of the Shares so
transferred, collectively, the "Banks Family Stockholders"). Each of the
▇▇▇▇▇▇▇▇▇ Stockholders, the Palisade/▇▇▇▇▇▇ Stockholders and the Banks Family
Stockholders are individually referred to as a "Stockholder" and collectively
referred to as the "Stockholders".
WHEREAS, Palisade is the owner of 1,504,545 shares, ▇▇▇▇▇▇▇ ▇▇▇▇▇ is
the owner of 980,000 shares, ▇▇▇▇▇▇ ▇▇▇▇▇ is the owner of 250,000 shares and
▇▇▇▇▇▇ ▇▇▇▇▇ is the owner of 249,808 shares of the Common Stock, having a
present par value of $.10 per share (which par value is proposed to be reduced
to $.01 per share), of GVC Venture Corp., a Delaware corporation (the
"Company");
WHEREAS, ▇▇▇▇▇▇▇▇▇ Company, ▇▇▇▇▇▇ ▇▇▇▇▇ and the ▇▇▇▇▇▇ Industries are
parties to a Stock Purchase Agreement of even date herewith (the "Stock Purchase
Agreement") pursuant to which ▇▇▇▇▇▇▇▇▇ Company, ▇▇▇▇▇▇ ▇▇▇▇▇, and ▇▇▇▇▇▇
Industries have agreed to purchase, subject to certain terms and conditions,
6,300,000; 1,300,000; 1,300,000 shares, respectively, of the Company's Common
Stock after a reduction in the par value thereof to $.01 per share (such shares,
together with the shares referred to in the immediately preceding preamble, are
referred to collectively as the "Shares").
WHEREAS, the Stockholders believe it is in their mutual best interests
to vote together with respect to certain matters in the manner set forth in this
Agreement and to effectuate the other purposes of this Agreement,
NOW, THEREFORE, in consideration of the premises and the mutual
representations, covenants and agreements set forth herein, and for other good
and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the Stockholders hereby agree as follows:
1. Agreement to Vote. Except to the extent otherwise agreed from time
to time by each of: (a) the holders of a majority of the Shares held by the
▇▇▇▇▇▇▇▇▇ Stockholders, (b) the holders of a majority of the Shares held by the
Palisade/▇▇▇▇▇▇ Stockholders and (c) the holders of a majority of the Shares
held by the Banks Family Stockholders, each Stockholder
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covenants and agrees to vote (in person or by proxy), at all meetings of the
stockholders of the Company however called and with regard to all actions
proposed to be taken by written consent of the stockholders of the Company at
any time during the term of this Agreement, all voting securities of the Company
(whether now owned or hereafter acquired) which such Stockholder beneficially
owns (within the meaning of Rule 13(d)(3) promulgated under the Securities and
Exchange Act of 1934, other than shares of the Company's capital stock owned by
persons who are not bound by this Agreement (i) which such Stockholder has the
right to vote solely as a result of being designated a proxy pursuant to a
solicitation made on behalf of the Company's Board of Directors (the "Board"),
(ii) which such Stockholder may be deemed to beneficially own solely from the
possession of dispositive power with respect to such shares, and (iii) which are
presently held by or hereafter acquired by such Stockholder as trustee or in
another fiduciary capacity and shares held by a spouse of such Stockholder
(except that Shares presently owned directly by such Stockholder which are
transferred to such trustee or other fiduciary or to such Stockholder's spouse
shall be subject to this Agreement and such transfer shall be made only in
accordance with Section 3 of this Agreement):
(a) in favor of each proposal set forth in the Notice of Special
Meeting of the Company's Stockholders contained in the Preliminary Information
Statement being submitted by the Company to the Securities and Exchange
Commission on or about April 30, 2004; and
(b) in favor of the election as directors of the Company of (i)
one designee as may be selected by the holders of a majority of the Shares held
by the Banks Family Stockholders, (ii) one designee as may be selected by the
holders of a majority of the Shares held by the Palisade/▇▇▇▇▇▇ Stockholders,
and (iii) a number of designees as may be selected of the ▇▇▇▇▇▇▇▇▇ Stockholders
that are sufficient to constitute, at all times, a majority of the Entire Board.
Each director so elected shall serve in accordance with the Company's Restated
Certificate of Incorporation and By-laws, as same may be amended or restated
from time to time (the "Certificate of Incorporation" and "By-laws,"
respectively). Such directors shall serve in such classes as may be required
under the Company's Certificate of Incorporation and By-laws, as shall be
determined by ▇▇▇▇▇▇▇▇▇ Company, unless and until the Company's stockholders
determine to declassify the Board and all directors cease to be classified.
Should any designee of the ▇▇▇▇▇▇▇▇▇ Stockholders, the Palisade/▇▇▇▇▇▇
Stockholders or the Banks Family Stockholders resign, determine not to seek
re-election to the Board, be removed from office, die, become incapacitated or
otherwise cease to serve on the Board, and should such designee not be replaced
by the Board with the a designee recommended to the Board by the Stockholders
who designated the director being replaced, or should such designee's term of
office expire, the Stockholders agree to take all such action as may be
permitted under the Company's Certificate of Incorporation or By-laws and laws
of its state of incorporation to promptly call a special or other meeting of
stockholders of the Company and vote, or execute a written consent, to elect as
the successor to such former director a person designated by the holders of a
majority of the Shares held by the Stockholders whose designee is to be
replaced. Such successor shall be elected into the class (if any) of directors
in which such former designee was serving.
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The term "Entire Board," as used in this Agreement, means the total
number of directors that the Company would have if there were no vacancies on
the Board of Directors.
The ability of each of the ▇▇▇▇▇▇▇▇▇ Stockholders, the Palisade/▇▇▇▇▇▇
Stockholders and the Banks Family Stockholders to designate one or more
directors is a right and not an obligation and such right may be exercised at
any time during the term of this Agreement.
2. Non Transfer of Shares. Until December 15, 2005, no Stockholder
will offer, sell, contract to sell, pledge, grant any option for the sale of, or
otherwise dispose or cause the disposition of, any shares of the Company's
Common Stock owned by such Stockholder or any securities convertible into or
exchangeable or exercisable for any such shares, whether owned on the date
hereof or hereafter acquired, except (a) pursuant to those certain Stock Option
Agreements dated as of April 29, 2004 between ▇▇▇▇▇▇▇▇▇ & Company and ▇▇▇▇▇▇
Industries granting ▇▇▇▇▇▇ Industries the option to purchase 1,300,000, and
between ▇▇▇▇▇▇▇▇▇ & Company and ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ granting Mr. Orlando the option
to purchase 500,000, of the shares being purchased by ▇▇▇▇▇▇▇▇▇ & Company
pursuant to the Stock Purchase Agreement and (b) pursuant to a merger with, or
sale of substantially all of its assets to, or another change in control
transaction with, another entity that is approved by the Board of Directors
following which transaction or series of transactions the stockholders of the
Company immediately following the closing thereof do not own more than 50% of
the outstanding voting power of the resulting entity at the effective date of
the last of such transactions.
3. Stockholders' Representations. Each Stockholder represents and
warrants to each other Stockholder that: (a) upon consummation of the purchase
of Shares pursuant to the Stock Purchase Agreement, (i) the Stockholder will be
the sole owner of record and beneficially, with sole voting power, of the Shares
reflected below such Stockholder's signature to this Agreement and (ii) such
Shares will constitute all of the outstanding voting securities of the Company
then owned of record or beneficially by such Stockholder; (b) the Stockholder
possesses full power and authority to enter into this Agreement and carry out
such Stockholder's obligations under this Agreement; (c) the execution and
delivery of this Agreement does not, and carrying out such Stockholder's
obligations under this Agreement will not, conflict with or result in the
violation of any agreement, judgment, decree, law or regulation applicable to
the Stockholder; and (d) there are no outstanding rights or obligations granted
by the Stockholder relating to the ownership, voting or disposition of any of
the voting securities of the Company owned (including Shares to be purchased by
such Stockholder under the Stock Purchase Agreement) of record or beneficially
by such Stockholder.
4. Parties Bound. This Agreement shall inure to the benefit of, and be
binding upon, the parties hereto and their respective heirs, personal
representatives, successors and permitted assigns. Notwithstanding the
foregoing, the rights and obligations under this Agreement of an initial party
hereto or a permitted assignee thereof may be assigned without such consent with
a transfer of such Shares to a member of such Stockholder's "immediate
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family" or an "Affiliate" of such Stockholder (as these terms are defined below)
or a member of the `immediate family" of such Affiliate. Any Stockholder
effectuating any transfer pursuant to the preceding sentence shall, as a
condition to such transfer, first obtain an agreement in writing from such
transferee to be bound by all of the terms and provisions of this Agreement with
the same force and effect as if such transferee were a "Stockholder" (and such
transferee shall then be considered, for all purposes of this Agreement, a
"Stockholder" and member of the group of Stockholders (i.e., ▇▇▇▇▇▇▇▇▇, Banks
Family or Palisade/▇▇▇▇▇▇ Stockholders) from which such transferee received the
transferred Shares or interest therein. Nothing herein (except as provided in
Section 2) shall be construed as otherwise limiting a Stockholder's right to
transfer his, her or its Shares; however any such transferee, other than
pursuant to the immediately preceding two sentences, shall not be entitled to
the rights and benefits of this Agreement but shall be subject to the
obligations under this Agreement of the group of Stockholders from which such
transferee acquired such Shares. All rights and authority granted herein by each
Stockholder shall survive the death or incapacity of the Stockholder.
The stock certificates evidencing Shares held by such Stockholder (and
any Shares issued to transferees thereof to whom this Agreement applies) shall,
so long as this Agreement pertains thereto, bear the following legend:
"The shares represented by this certificate are subject to the
terms and conditions of a Stockholders Agreement dated as of
April 29, 2004 by and among certain stockholders of the
Company, a copy of which is on file at the principal office of
the Company."
As used in this Agreement, (a) the term "immediate family" means such
person's spouse, parents, children, siblings and trusts created exclusively for
such Stockholder and/or the aforementioned relatives of such Stockholder, and
(b) an "Affiliate" of a referenced person, firm or entity shall mean any person
controlling, controlled by or under common control with such referenced person,
firm or entity.
5. Term. This Agreement shall become effective upon its execution by
all initial parties hereto (the "Effective Date") and shall terminate on the
earliest to occur of: (i) the termination of the Stock Purchase Agreement
without the purchase of any Shares thereunder; (ii) December 31, 2006; or (iii)
the liquidation of the Company or the Company's merger with, or sale of
substantially all of its assets to, or another change in control transaction
with, another entity that is approved by the Board of Directors, following which
transaction or series of transactions the stockholders of the Company
immediately prior to the first of such transactions do not own more than 50% of
the outstanding voting power of the resulting entity at the effective date of
the last of such transactions.
6. Availability of Equitable Remedies. The Stockholders acknowledge
that a breach of the provisions of this Agreement by any Stockholder would cause
irrevocable injury to the other Stockholders and could not adequately be
compensated by money damages. Accordingly, a Stockholder shall be entitled, in
addition to any other right or remedy available to
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him, her or it, to an injunction restraining a breach or a threatened breach of
this Agreement and to specific performance of any such provision of this
Agreement, in either case without bond or other security, and the other
Stockholders will not take any action, directly or indirectly, in opposition to
the moving party seeking such relief on the grounds that any other remedy or
relief is available at law or in equity.
7. Consent to Service of Process, etc. Each Stockholder hereby
consents to the personal jurisdiction of the United States District Court for
the Southern District of New York and of any of the courts of the State of New
York in New York County, New York in any action, suit or proceeding arising
under this Agreement. Each Stockholder agrees to bring any such action, suit or
proceeding only in such courts. Each Stockholder agrees further that service of
process or notice in any such action, suit or proceeding shall be effective if
given in the manner set forth in Section 7 hereof.
8. Notices. All notices, requests, demands and other communications
which are required to be or which may be given under this Agreement shall be in
writing and shall be deemed to have been duly given when delivered in person,
the scheduled business day of delivery if sent by Express Mail, Federal Express,
other overnight delivery service or five business days after mailed if mailed by
certified or registered first class mail return receipt requested, in any such
case with delivery charges prepaid, to the party to whom the same is so given or
made, at the following addresses (or such other address as shall be provided by
notice given in accordance with this Section 8 by the party whose address is to
be changed):
(a) If to a member of the Banks Family:
c/o ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
With copy by e-mail to:
▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇
and
▇▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇
(b) If to a member of the Palisade/▇▇▇▇▇▇ Stockholders:
c/o Palisade Investors LLC ▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇ ▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
(c) If to a member of the ▇▇▇▇▇▇▇▇▇ Stockholders:
c/o ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
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9. Amendments. This Agreement and any term hereof may not be amended,
changed, discharged or terminated except by an instrument in writing signed by
the original signatories hereof.
10. Waivers. The failure of a party to insist upon strict adherence to
any term or provision of this Agreement on any occasion shall not be considered
a waiver, or deprive the party of the right thereafter to insist upon strict
adherence to that term or provision or any other term or provision of this
Agreement. Any waiver must be in writing and be duly executed by the party to be
charged.
11. Governing Law. This Agreement shall be governed and interpreted in
accordance with the laws of the state of Delaware, without regard to the
conflict of laws principles thereof that would defer to the laws of another
jurisdiction or the actual domiciles of the parties hereto.
12. Counterparts. This Agreement may be executed in two or more
counterparts and by the different parties hereto on separate counterparts, each
of which shall be deemed an original, but all of which together shall constitute
one and the same instrument.
13. Headings. The headings in this Agreement are for purposes of
reference only and shall not be considered in construing this Agreement.
14. Entire Agreement. This Agreement contains the entire understanding
of the parties herein, and supersedes all prior discussions and understandings
of the parties hereto, respecting the subject matter hereof.
15. Severability. If any provision of this Agreement or the
application of any provision to any person or circumstance shall be held
invalid, the remainder of this Agreement, or the application of that provision
to persons or circumstances other than those which it is held invalid, shall not
be affected thereby.
IN WITNESS WHEREOF, the parties have executed and delivered this
Agreement.
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ & COMPANY, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
------------------------------
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, President
Number of Shares of Common Stock:
6,300,000 after the Closing under
the Stock Purchase Agreement.
[Signatures continued on next page]
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PALISADE INVESTORS LLC
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Chief Operating Officer
Number of Shares of Common Stock:
1,504,545
▇▇▇▇▇▇ INDUSTRIES, INC.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Vice President
Number of Shares of Common Stock:
1,300,000 after the Closing under
the Stock Purchase Agreement.
/s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇
-------------------------------
▇▇▇▇▇▇▇ ▇▇▇▇▇
Number of Shares of Common Stock:
980,000
/s/ ▇▇▇▇▇▇ ▇▇▇▇▇
-------------------------------
▇▇▇▇▇▇ ▇▇▇▇▇
Number of Shares of Common Stock:
250,000
/s/ ▇▇▇▇▇▇ ▇▇▇▇▇
-------------------------------
▇▇▇▇▇▇ ▇▇▇▇▇
Number of Shares of Common Stock: 249,808 and
1,549,808 prior to and after the Closing under the
Stock Purchase Agreement, respectively
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