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SARATOGA BEVERAGE GROUP, INC.
STOCKHOLDERS AGREEMENT
Dated as of January 5, 2000
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TABLE OF CONTENTS
Page
ARTICLE I
GOVERNANCE AND MANAGEMENT OF THE COMPANY
Section 1.1. Board of Directors.................................................................1
Section 1.2. Governance.........................................................................2
Section 1.3. Indemnification of Directors and Officers..........................................3
ARTICLE II
RESTRICTIONS ON TRANSFER
Section 2.1. Restrictions on Transfer...........................................................3
Section 2.2. Transfers After Second Anniversary of Closing Public Offering, Change
of Control or Exit Event...........................................................4
Section 2.3. Tag-Along Rights...................................................................4
Section 2.4. Take-Along Rights..................................................................5
Section 2.5. Transfer of Covered Securities to Affiliate of NCP-SBG.............................7
Section 2.6. Hold Back Agreements...............................................................7
ARTICLE III
OTHER AGREEMENTS
Section 3.1. Right of First Refusal.............................................................7
Section 3.2. Issuance of Additional Shares of Equity Securities.................................8
Section 3.3. Future Acquisitions................................................................9
ARTICLE IV
DEFINITIONS
Section 4.1. Definitions; Construction..........................................................9
ARTICLE V
MISCELLANEOUS
Section 5.1. Notices...........................................................................12
Section 5.2. Remedies..........................................................................13
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Section 5.3. Governing Law, etc................................................................14
Section 5.4. Binding Effect....................................................................15
Section 5.5. Assignment........................................................................15
Section 5.6. No Third Party Beneficiaries......................................................15
Section 5.7. Amendment; Waivers, etc...........................................................15
Section 5.8. Legend on Stock Certificates......................................................16
Section 5.9. Entire Agreement..................................................................17
Section 5.10. Severability......................................................................17
Section 5.11. Headings; Counterparts............................................................17
Section 5.12. Subsequent Stockholders...........................................................17
Section 5.13. Reports...........................................................................18
Section 5.14. Certain Agreements................................................................18
Section 5.15. Effectiveness.....................................................................18
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Stockholders Agreement
Schedule A
Reference is made to the Stockholders Agreement, dated January __, 2000,
between Saratoga Beverage Group, Inc., NCP-SBG, L.P., and the other parties
thereto (the "Stockholders Agreement"). The undersigned agrees, by execution
hereof, to become a party to, and to be subject to the rights and obligations
under, the Stockholders Agreement.
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Name:
Title:
Address:
Date:
SARATOGA BEVERAGE GROUP, INC.
By:
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Name:
Title:
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STOCKHOLDERS AGREEMENT
STOCKHOLDERS AGREEMENT (this "Agreement"), dated as of January 5,
2000, among Saratoga Beverage Group, Inc., a Delaware corporation (the
"Company"), NCP-SBG, L.P., a Delaware limited partnership ("NCP-SBG"), and the
Persons listed on the signature pages hereto, and each other person who is, or
becomes, a party to this Agreement pursuant to Section 5.12 hereof
(collectively, with NCP-SBG and the Persons listed on the signature pages
hereto, the "Stockholders"). Capitalized terms used herein without definition
shall have the meanings indicated in Article IV.
WHEREAS, upon the terms and subject to the conditions of the
Stock Purchase Agreement and Agreement and Plan of Merger, dated as of the date
hereof (the "Recapitalization Agreement"), among the Company, NCP-SBG and
NCP-SBG Recapitalization Corp., NCP-SBG will acquire shares (the "Purchased
Shares") of common stock, par value $0.01 per share (the "Common Stock"), of the
Company;
WHEREAS, the parties hereto wish to set forth certain rights and
obligations that shall attach to the ownership of Common Stock held by the
Stockholders; and
WHEREAS, it is a condition to the consummation of the
transactions contemplated by the Recapitalization Agreement that the parties
hereto enter into this Agreement;
NOW, THEREFORE, in consideration of the mutual agreements
contained herein and other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereto hereby agree as
follows:
ARTICLE I
GOVERNANCE AND MANAGEMENT OF THE COMPANY
Section 1.1. Board of Directors. (a) Composition. Subject to the provisions
of this Agreement, the Board of Directors of the Company (the "Board") will
consist initially of seven members: (i) four members nominated by NCP-SBG, and
(ii) three members nominated by ▇▇▇▇▇ ▇▇▇▇▇▇. Subject to the provisions of this
Agreement, each Stockholder entitled to vote shall vote their shares of Common
Stock so as to effect the provisions of this Section 1.1(a).
(b) Nominees. NCP-SBG shall nominate all persons for election to the Board,
except that, for so long as she is the Chief Executive Officer of the Company,
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(i) ▇▇▇▇▇ ▇▇▇▇▇▇ shall be entitled to nominate three directors, provided that if
▇▇▇▇▇ ▇▇▇▇▇▇ is no longer the Chief Executive Officer of the Company, then so
long as the Rollover Stockholders collectively own at least 5% of the
outstanding Common Stock of the Company, such Rollover Stockholders collectively
shall be entitled to nominate one director. Each Stockholder entitled to vote
shall vote their shares of Common Stock so as to elect such nominees to the
Board.
(c) Removal and Replacement of Nominees. Any director nominated by a party
hereto may be removed at any time, with or without cause, by such party, and
each Stockholder entitled to vote thereon shall vote their shares of Common
Stock as may be required to effect such removal, including voting its shares for
such removal. In addition, at such time as ▇▇▇▇▇ ▇▇▇▇▇▇ is no longer Chief
Executive Officer of the Company, the Stockholders shall vote their shares of
Common Stock to remove at least two directors nominated by ▇▇▇▇▇ ▇▇▇▇▇▇ if such
directors shall not have resigned. At any time a vacancy shall be created on the
Board as a result of the death, disability, retirement, resignation or removal
of a director nominated by a party hereto, with or without cause, then such
party shall have the right to nominate a replacement for any director nominated
by it in accordance with Sections 1.1(b), and each Stockholder entitled to vote
shall vote their shares of Common Stock so as to elect such replacement.
(d) Fees and Expenses. The Company will cause each non-employee director of
the Board to be reimbursed for all reasonable out-of-pocket costs and expenses
incurred by him or her in connection with serving as a director. No director
nominated by NCP-SBG who is an officer or employee of North Castle Partners II,
L.L.C. ("NCP") or any Affiliate thereof (other than any portfolio company
controlled by NCP or controlled by any other private investment fund under
common control with NCP) shall be entitled to any fee with respect to his or her
service as a director of the Board at any time at which NCP is providing
consulting services to the Company and its subsidiaries pursuant to the
Consulting Agreement, dated as of the date hereof by and between the Company and
NCP.
(e) Chairperson. The Chairperson of the Board shall be designated by
NCP-SBG from among the directors of the Company.
Section 1.2. Governance. (a) Charter and Bylaws. The provisions of the
Company's Certificate of Incorporation and Bylaws will be consistent with the
terms of this Agreement.
(b) Board Approval. All actions requiring the approval of the Board shall
be approved (A) at a meeting of the Board, by a majority of the total number of
directors
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then fixed as constituting the whole board, or (B) without a meeting by the
unanimous written consent of all the members of the Board, in each case except
as required by law.
Section 1.3. Indemnification of Directors and Officers. The Bylaws shall
provide for indemnification of the directors and officers of the Company to the
greatest extent permitted by applicable law.
ARTICLE II
RESTRICTIONS ON TRANSFER
Section 2.1. Restrictions on Transfer. (a) Until the first to occur of
(w) a Public Offering, (x) a Change of Control, (y) the second anniversary of
the Closing under the Recapitalization Agreement (the "Closing"), and (z) an
Exit Event, no Stockholder other than NCP-SBG and its Affiliates may, without
the consent of NCP-SBG (which consent may not be unreasonably withheld), sell,
transfer, pledge, encumber or otherwise dispose of any Covered Security or any
interest therein to any Person except as follows:
(i) to any Family Member of such Stockholder upon the death of such
Stockholder, provided that such Family Member delivers to the Company a
certificate of the transferee, to the effect that the transferee is a
Family Member of the transferor;
(ii) to any Family Member other than upon the death of such
Stockholder, provided that such Family Member delivers to the Company a
certificate of the transferee, to the effect that the transferee is a
Family Member of the transferor;
(iii) to the Company or NCP-SBG or any of its Affiliates or designees;
(iv) pursuant to Sections 2.3 and 2.4; or
(v) in connection with a transaction that results in a Change of
Control;
provided that, in the case of a transfer with NCP-SBG's consent or
pursuant to clauses (i) or (ii) above, (A) the transferor delivers to the
Company an opinion of counsel, which opinion and counsel shall be
reasonably satisfactory to the Company, to the effect that the transfer is
not a Prohibited Transfer, and (B) the transferee becomes a party to this
Agreement in the manner provided in Section 5.12.
(b) Each Stockholder shall give the Company and the other Stockholders
prompt notice of any actual transfer of any Covered Security. Any sale,
transfer, pledge,
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encumbrance or other disposition of any Covered Security other than as permitted
by this Agreement shall be void ab initio and of no effect.
(c) Notwithstanding anything contained herein to the contrary, each
Rollover Stockholder may, without the consent of NCP-SBG, sell or transfer any
Covered Security to another Rollover Stockholder, subject to compliance with
applicable laws and contractual agreements and delivery to the Company of an
opinion of counsel, which opinion and counsel shall be reasonably satisfactory
to the Company, to the effect that the transfer is not a Prohibited Transfer.
(d) Notwithstanding the provisions of Section 2.1(a), ▇▇. ▇▇▇ may
pledge or encumber his Covered Securities or grant a security interest therein
without the consent of NCP-SGB, provided, that any subsequent sale, transfer or
other disposition pursuant to such pledge, encumbrance or security interest
shall require the consent of NCP-SBG.
Section 2.2. Transfers After Second Anniversary of Closing Public
Offering, Change of Control or Exit Event. (a) Following the first to occur of
the second anniversary of the Closing, an initial Public Offering, a Change of
Control and an Exit Event, and subject to Article III, any Stockholder may
transfer Covered Securities to any Person, subject to compliance with applicable
laws and contractual agreements.
(b) Opinion of Counsel. An additional condition to any transfer
pursuant to Sections 2.2(a) shall be that, except with respect to a transfer of
the type described in Section 2.1(a)(iii) or a transfer made pursuant to a
registered public offering, the transferee must deliver to the Company an
opinion of counsel, which opinion and counsel shall be reasonably satisfactory
to the Company, to the effect that such transfer is not required to be
registered under the Securities Act.
Section 2.3. Tag-Along Rights. If prior to a Public Offering any of
NCP-SBG or its Affiliates desire to transfer in excess of 10% of the maximum
amount of Common Stock ever owned in the aggregate by NCP-SBG and its Affiliates
(the "Tag- Along Minimum"), to a Person who is not an Affiliate of NCP-SBG (a
"Tag-Along Buyer"), on a cumulative basis, in one or a series of transactions,
then NCP-SBG shall deliver written notice (a "Tag-Along Notice") to the Company
and the other Stockholders, which notice shall state (i) the name and address of
the Tag-Along Buyer, (ii) the per share amount (the "Tag-Along Price") and form
of consideration NCP-SBG proposes to receive for its shares of Common Stock, and
(iii) the number of shares of Common Stock NCP-SBG proposes to sell (the
"Tag-Along Shares") and shall be accompanied by drafts of purchase and sale
documentation (the "Tag-Along Purchase Agreement") setting forth the terms and
conditions of payment of such consideration and all other material terms and
conditions of such transfer (the "Tag-Along Terms"). During the 15 Business Day
period
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following receipt of such notice by the Company and the other Stockholders, the
other Stockholders shall have the right (a "Tag-Along Right"), exercised by
delivery of a written notice to NCP-SBG and the Company, to participate in such
sale to the Tag-Along Buyer on and subject to the same price, terms and
conditions offered to NCP-SBG, on a pro rata basis determined as the quotient
obtained by dividing (A) the number of shares of Common Stock then held by each
Stockholder so electing to sell (each such Person, an "Accepting Stockholder")
by (B) the aggregate number of shares of Common Stock then held by NCP-SBG and
Affiliates and by all of the Accepting Stockholders who are transferring shares
to the Tag-Along Buyer. If the Tag-Along Right shall not have been exercised
prior to the expiration of the 15 Business Day period, then at any time during
the 90 days following the expiration of the 15 Business Day period, subject to
extension for not more than an additional 60 days to the extent reasonably
required to comply with applicable laws in connection with such sale, NCP-SBG
and its Affiliates may sell the Tag- Along Shares to the Tag-Along Buyer at the
Tag-Along Price and on the Tag-Along Terms. Upon request from NCP-SBG, the
Company will provide NCP-SBG with a Stockholder List.
Section 2.4. Take-Along Rights. (a) Take-Along Notice. If NCP-SBG
intends to effect a sale or transfer (a "Take-Along Sale") of all or
substantially all of its shares of Common Stock to a Person who is not an
Affiliate (a "Take-Along Buyer") prior to a Public Offering and elects to
exercise its rights under this Section 2.4, then NCP-SBG shall deliver written
notice (a "Take-Along Notice") to the Company and the other Stockholders, which
notice shall (i) state (w) that NCP-SBG wishes to exercise its rights under this
Section 2.4 with respect to such transfer, (x) the name and address of the
Take-Along Buyer and (y) the per share amount and form of consideration NCP-SBG
proposes to receive for its shares of Common Stock, (ii) be accompanied by
drafts of purchase and sale documentation setting forth the terms and conditions
of payment of such consideration and all other material terms and conditions of
such transfer (the "Take- Along Purchase Agreement"), (iii) contain an offer
(the "Take-Along Offer") by the Take-Along Buyer to purchase from the other
Stockholders all of their shares of Common Stock, on and subject to the same
price, terms and conditions offered to NCP-SBG and (iv) state the anticipated
time and place of the closing of such transfer (a "Take-Along Closing"), which
(subject to such terms and conditions) shall occur not fewer than 15 nor more
than 90 days after the date such Take-Along Notice is delivered, provided that
if such Take-Along Closing shall not occur prior to the expiration of such
90-day period, NCP-SBG shall be entitled to deliver additional Take-Along
Notices with respect to such Take-Along Offer. Upon the request of NCP-SBG, the
Company shall provide NCP-SBG with a Stockholder List.
(b) Conditions to Take-Along. Upon delivery of a Take-Along Notice,
each of the other Stockholders shall transfer all of its shares of Common Stock
pursuant
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to the Take-Along Offer, as such offer may be modified from time to time, if
NCP-SBG transfers all of its shares of Common Stock to the Take-Along Buyer at
the Take-Along Closing and if all shares of Common Stock held by NCP-SBG and the
other Stockholders are sold to the Take-Along Buyer at the same price, and on
the same terms and conditions. No Stockholder other than NCP-SBG and its
Affiliates shall be obligated to make any representation or warranty to the
Take-Along Buyer with respect to, or agree to indemnify the Take-Along Buyer
against, any matter other than (i) title to such Stockholder's shares of Common
Stock to be sold pursuant to the Take-Along Offer and (ii) authority and legal
capacity of such Stockholder to sell such shares or incur any out-of-pocket
costs in connection with such transaction other than such Stockholder's pro rata
share of any transaction expenses payable in connection with the Take-Along
Closing. Within five Business Days prior to the closing contemplated by the
Take-Along Notice, each of the other Stockholders shall (i) deliver or cause to
be delivered to NCP-SBG or an agent acting on its behalf certificates
representing such other Stockholder's shares of Common Stock, duly endorsed for
transfer or accompanied by duly executed stock powers, and (ii) execute and
deliver to NCP-SBG or an agent acting on its behalf a limited power of attorney
and a letter of transmittal and custody agreement in favor of NCP-SBG or an
agent acting on its behalf, and in form and substance reasonably satisfactory to
NCP-SBG, appointing NCP-SBG or an agent acting on its behalf as the true and
lawful attorney-in-fact and custodian for such other Stockholder with respect to
the Take-Along Purchase Agreement and the transactions contemplated thereby,
with full power of substitution, and authorizing NCP-SBG or such agent to
execute and deliver a purchase and sale agreement substantially in the form of
the Take-Along Purchase Agreement and otherwise in accordance with the terms of
this Section 2.4 and to take such actions as NCP-SBG may reasonably deem
necessary or appropriate to effect the sale and transfer of the shares of Common
Stock to the Take-Along Buyer, upon receipt of the purchase price therefor set
forth in the Take-Along Notice at the Take-Along Closing, free and clear of any
Liens, options and voting agreements, together with all other documents
delivered with such Notice and required to be executed in connection with the
sale thereof pursuant to the Take-Along Offer. NCP-SBG or such agent shall hold
such shares and other documents in trust for such other Stockholder for release
against payment to such Stockholder of such Stockholder's net proceeds in
accordance with the contemplated transaction. If, within 15 days after delivery
of such shares and other documents to NCP-SBG or an agent acting on its behalf,
NCP-SBG or such agent has not completed the sale of all of the shares of Common
Stock owned by NCP-SBG and the other Stockholders to the Take-Along Buyer and
another Take-Along Notice with respect to such Take-Along Offer has not been
sent to the other Stockholders, NCP-SBG or such agent shall return to each other
Stockholder all certificates representing the shares and all other documents
that such other Stockholder delivered in connection with such sale. Promptly
after the Take-Along Closing, NCP-SBG or an agent acting on its behalf shall
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furnish such other evidence of the completion and time of completion of such
sale and the terms thereof as may reasonably be requested by any of the other
Stockholders.
Section 2.5. Transfer of Covered Securities to Affiliate of NCP-SBG.
In the event that any Covered Securities are transferred to any Affiliate of
NCP-SBG, such transfer to such Affiliate shall be of no effect and shall be void
ab initio unless such Affiliate agrees in writing to become a party to this
Agreement.
Section 2.6. Hold Back Agreements. If and whenever the Company
proposes to register any of its equity securities under the Securities Act,
whether or not for its own account (other than pursuant to a Special
Registration), or is required to use its reasonable best efforts to effect the
registration of any Registrable Securities (as such term is defined in the
Registration Rights Agreement, dated as of the date hereof, by and between the
Company, NCP-SBG and the other parties thereto (the "Registration Rights
Agreement")) under the Securities Act pursuant to Sections 3.1 or 3.2 of the
Registration Rights Agreement, each party hereto, if required by the managing
underwriter in an underwritten offering, agrees not to effect (other than
pursuant to such registration) any public sale or distribution, including, but
not limited to, any sale pursuant to Rule 144 or Rule 144A, of any Registrable
Securities, any other equity securities of the Company or any securities
convertible into or exchangeable or exercisable for any equity securities of the
Company for 90 days (or 180 days, if the managing underwriter so requires)
after, and during the 20 days prior to, the effective date of such registration,
to the extent timely notified in writing by the Company or the managing
underwriter, and the Company agrees to cause each holder of any Equity Security,
or of any security convertible into or exchangeable or exercisable for any
Equity Security, of the Company purchased from the Company at any time other
than in a Public Offering to enter into a similar agreement with the Company.
The Company further agrees not to effect (other than pursuant to such
registration or pursuant to a Special Registration) any public sale or
distribution, or to file any registration statement (other than such
registration or a Special Registration) covering any, of its equity securities,
or any securities convertible into or exchangeable or exercisable for such
securities, during the 20 days prior to, and for 90 days (or 180 days, if the
managing underwriter so requires) after, the effective date of such registration
if required by the managing underwriter.
ARTICLE III
OTHER AGREEMENTS
Section 3.1. Right of First Refusal. Prior to an initial Public
Offering, if any Stockholder other than NCP-SBG and its Affiliates (a "Selling
Holder") desires to transfer any Covered Securities pursuant to Section 2.1(a)
following an offer (which offer must be
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in writing, be irrevocable by its terms for at least 30 Business Days and be a
bona fide offer) from any prospective purchaser to purchase all or any part of
such Covered Securities owned by such Selling Holder, such Selling Holder shall
give notice (the "Notice of Offer") in writing to the Company and to NCP-SBG (i)
designating the number of shares of Covered Securities that such Selling Holder
proposes to sell (the "Offered Shares"), (ii) identifying the prospective
purchaser thereof (the "Potential Purchaser") and its address and (iii)
specifying the price (the "Offer Price") and terms (the "Offer Terms") upon
which such Selling Holder desires to sell the same. During the 20 Business Day
period following receipt of such notice by the Company and NCP-SBG (the "Refusal
Period"), such Selling Holder shall not be permitted to accept such offer, but
may submit a new Notice of Offer in respect of any revised offer in accordance
with and subject to this Section 2.3. During the first ten Business Days of the
Refusal Period, the Company shall have the right to purchase from the Selling
Holder at the Offer Price and on the Offer Terms all, any portion of the Offered
Shares. If the Company shall not have exercised such right with respect to all
Covered Securities after ten Business Days, NCP-SBG or any Affiliate or designee
of NCP-SBG, including any pooled investment vehicle organized by the managing
member of NCP-SBG or by any of its Affiliates, shall have the same right of
first refusal with respect to any such remaining Covered Securities for the
remainder of the Refusal Period. The rights provided hereunder shall be
exercised by written notice to the Selling Holder and the Company or NCP-SBG, as
the case may be, given at any time during the Refusal Period. If such right is
exercised, the Company or NCP-SBG (or its Affiliate or designee), as the case
may be, shall deliver to the Selling Holder payment of the Offer Price in
accordance with the Offer Terms, against delivery of appropriately endorsed
certificates or other instruments representing the Offered Shares, provided that
the Company and NCP-SBG shall not be required to consummate such purchase on
fewer than 20 Business Days from the date of acceptance of the offer. If the
Company and NCP-SBG fail, in the aggregate, to exercise their right of first
refusal for all of the Offered Shares during the Refusal Period, then they shall
have no right to purchase any Offered Shares, and the Selling Holder may, for a
period of up to 120 days, sell to the Potential Purchaser the Offered Shares at
the Offer Price and on the Offer Terms.
Section 3.2. Issuance of Additional Shares of Equity Securities. In
the case of the proposed sale or issuance of, or the proposed granting by the
Company of, any equity securities of the Company, or any securities convertible
into equity securities of the Company, to NCP-SBG or any of its Affiliates
following the Effective Time, the Rollover Stockholders shall have the right,
exercisable within 20 Business Days after the Company has given notice, which
notice shall include copies of all material documents setting forth the terms
and conditions of the proposed sale, issuance or grant, to the Rollover
Stockholders of such proposed sale, issuance or grant, to purchase their
respective pro rata share (based on such Stockholder's percentage ownership of
the common stock of the Company) of the equity securities (or securities
convertible into equity securities)
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proposed to be issued or granted on the same terms as such equity securities (or
securities convertible into equity securities) are offered to NCP-SGB or its
Affiliates.
Section 3.3. Future Acquisitions. The Company and NCP-SBG agree, and
NCP-SPG agrees to cause its Affiliates and the respective officers and directors
of such Affiliates, to pursue all future acquisitions, mergers and
recapitalizations involving businesses in the refrigerated juice industry (other
than minority investments by NCP-SGB or any of its affiliates) through (i) the
Company, with such entities to be acquired, owned and operated by the Company,
or (ii) any other company, provided that the Rollover Stockholders shall have
had an opportunity to exchange their respective shares of common stock of the
Company for shares of common stock of an equivalent value in such other company
in connection with any such transaction which results in the Company not being
the top-tier holding company for investments by NCP-SGB in the refrigerated
juice industry.
ARTICLE IV
DEFINITIONS
Section 4.1. Definitions; Construction. Whenever used in this
Agreement, the following terms shall have the respective meanings given to them
below or in the Sections indicated below:
Affiliate: of a Person means a Person that directly or indirectly
through one or more intermediaries, controls, is controlled by, or is under
common control with, the first Person, including but not limited to a
Subsidiary of the first Person, a Person of which the first Person is a
Subsidiary, or another Subsidiary of a Person of which the first Person is
also a Subsidiary. "Control" (including the terms "controlled by" and
"under common control with") means the possession, directly or indirectly,
of the power to direct or cause the direction of the management policies of
a person, whether through the ownership of voting securities, by contract
or credit arrangement, as trustee or executor, or otherwise. With respect
to NCP-SBG, the term Affiliate explicitly includes the Fund, NCP II
Co-Investment Fund, L.P., any other investment vehicle now or in the future
managed by North Castle Partners, L.L.C. and any Person with coinvestment
rights with respect to investments made by the Fund.
Board: as defined in Section 1.1(a).
Business Day: any day other than a Saturday, Sunday or other day on
which the commercial banks in New York City are authorized or required to
close.
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Change of Control: means, with respect to the Company, the first to
occur after the Effective Time of the following events:
(1) the acquisition by any person, entity or group (as defined in
section 13(d) of the Exchange Act) (other than (w) the Company and its
subsidiaries, (x) any employee benefit plan of the Company or its
subsidiaries or (y) the Fund or any Affiliate or partner thereof), through
one transaction or a series of transactions of 50% or more of the combined
voting power of the then outstanding voting securities of the Company;
(2) the merger or consolidation of the Company as a result of which
persons who were Stockholders of the Company immediately prior to such
merger or consolidation, do not, immediately thereafter, own, directly or
indirectly, more than 50% of the combined voting power entitled to vote
generally in the election of directors of the merged or consolidated
company;
(3) the liquidation or dissolution of the Company (other than (x) a
dissolution occurring upon a merger or consolidation thereof (y) a
liquidation of the Company into its subsidiary or (z) a liquidation or
dissolution that is incident to a reorganization); and
(4) the sale, transfer or other disposition of all or substantially
all of the assets of the Company through one transaction or a series of
related transactions to one or more persons or entities that are not, im
mediately prior to such sale, transfer or other disposition, Affiliates of
the Fund.
Closing: as defined in Section 2.1(a).
Covered Security: all of the shares of Common Stock and any other
security, option, warrant or other right that does or may allow the holder
thereof to receive Common Stock, owned from time to time by any of the
Stockholders.
Equity Security: means (i) any Common Stock or other voting
securities, (ii) any securities of the Company convertible into or exchangeable
for Common Stock or other voting securities or (iii) any options, rights or
warrants (or any similar securities) issued by the Company to acquire common
stock or other voting securities.
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Exchange Act: as defined in Section 2.2(a).
Exit Event: any sale, transfer, merger or other transaction as a
result of which NCP-SBG and its Affiliates sell or otherwise dispose of all
or substantially all of their Common Stock, including in any dissolution or
liquidation of the Company.
Family Member: with respect to any Stockholder, (i) a spouse, sibling
or any lineal ancestor or descendant, (ii) a trust or trusts of which such
family members are the sole beneficiaries or charitable remainder trusts in
which such family members have an interest or (iii) a partnership or
limited liability company in which such family members are the only
partners or members, as the case may be.
Fund: North Castle Partners II, L.P.
NCP: as defined in Section 1.1(d).
Person: any natural person, firm, partnership, association,
corporation, company, trust, business trust, governmental authority or
other entity.
Prohibited Transfer: any transfer of a Covered Security to a Person
which (a) may not be effected without registering the securities involved
under the Securities Act, (b) would result in the assets of the Company
constituting Plan Assets as such term is defined in the Department of Labor
regulations promulgated under the Employee Retirement Income Security Act
of 1974, as amended, (c) would cause the Company to be, be controlled by or
under common control with an "investment company" for purposes of the
Investment Company Act of 1940, as amended, or (d) would require any
securities of the Company to be registered under the Exchange Act.
Public Offering: any underwritten sale of Common Stock to the public
pursuant to an effective registration statement under the Securities Act
after which at least 20% of the outstanding shares of Common Stock shall
have been registered under the Securities Act and such shares may be freely
traded.
Purchased Shares: as defined in the recitals to this Agreement.
Rollover Stockholders: shall be ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇▇, Steel Partners II, L.P., Pershing Securities
Limited and ▇▇▇▇ ▇▇▇▇▇▇.
Securities Act: the Securities Act of 1933, as amended.
11
16
Special Registration: the registration of shares of equity securities
and/or options or other rights in respect thereof to be offered solely to
directors, members of management, employees, consultants or sales agents,
distributors or similar representatives of the Company or its direct or
indirect subsidiaries, solely on Form S-8 or any successor form.
Stockholder: as defined in the introduction to this Agreement.
Stockholder List: at any applicable time, the list of the name and
addresses of the Stockholders at such time.
ARTICLE V
MISCELLANEOUS
Section 5.1. Notices. All notices, requests, demands, waivers and
other communications required or permitted to be given under this Agreement
shall be in writing and shall be deemed to have been duly given if (a)
delivered personally, (b) mailed, certified or registered mail with
postage prepaid, (c) sent by next-day or overnight mail or delivery or (d)
sent by fax, with a copy sent by (a), (b), or (c) above, or telegram, as
follows:
(i) if to NCP-SBG:
NCP-SBG, L.P.
c/o North Castle Partners, L.L.C.
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Tel: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
with a copy to:
Debevoise & ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Tel: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, Esq.
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(ii) if to the Company:
Saratoga Beverage Group, Inc.
▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Tel: (▇▇▇) ▇▇▇-▇▇▇▇ ▇-▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇
(iii) if to any other Person who is a party, or to any
Person who becomes a party to this Agreement
pursuant to Section 5.12 hereof, to the name and
address specified for such Person on the signature
pages hereto or in Schedule A hereto;
or, in each case, at such other address as may be specified in writing to the
other parties hereto.
All such notices, requests, demands, waivers and other communications shall
be deemed to have been received (w) if by personal delivery on the day after
such delivery, (x) if by certified or registered mail, on the seventh business
day after the mailing thereof, (y) if by next-day or overnight mail or delivery,
on the day delivered, (z) if by telecopy or telegram, on the next day following
the day on which such telecopy or telegram was sent, provided that a copy is
also sent by certified or registered mail.
Section 5.2. Remedies. Each Stockholder acknowledges that the other
Stockholders and the Company would be irreparably damaged in the event of a
breach or a threatened breach by such Stockholder or the Company of any of its
obligations under this Agreement (including without limitation the covenants set
forth in Section 3.3) and the Company and each Stockholder agrees that, in the
event of a breach or a threatened breach by the Company or such Stockholder of
any such obligation, each of the other Stockholders and the Company shall, in
addition to any other rights and remedies available to them in respect of such
breach, be entitled to an injunction from a court of competent jurisdiction
(without any requirement to post bond) granting them specific performance by
such Stockholder of its obligations under this Agreement (including without
limitation the covenants set forth in Section 3.3). In the event that any
Stockholder or the Company shall file suit to enforce the covenants contained in
this Agreement (including without limitation the covenants set forth in Section
3.3) (or obtain any other remedy in respect of any breach thereof), the
prevailing party in the suit shall be entitled to recover, in addition to all
other damages to which it may be entitled, the costs incurred by such party in
conducting the suit, including reasonable attorney's fees and expenses.
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18
Section 5.3. Governing Law, etc. (a) THIS AGREEMENT SHALL BE GOVERNED
IN ALL RESPECTS, INCLUDING AS TO VALIDITY, INTERPRETATION AND EFFECT, BY THE
INTERNAL LAWS OF THE STATE OF NEW YORK, WITHOUT GIVING EFFECT TO THE CONFLICT OF
LAWS RULES THEREOF TO THE EXTENT ANY SUCH RULES WOULD REQUIRE OR PERMIT THE
APPLICATION OF THE LAWS OF ANY OTHER JURISDICTION, EXCEPT TO THE EXTENT THAT THE
CORPORATE LAW OF THE STATE OF INCORPORATION OF THE COMPANY SPECIFICALLY AND
MANDATORILY APPLIES. EACH PARTY HERETO HEREBY IRREVOCABLY SUBMITS TO THE
JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK AND THE FEDERAL COURTS OF
THE UNITED STATES OF AMERICA LOCATED IN ▇▇▇ ▇▇▇▇▇, ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇
SOLELY IN RESPECT OF THE INTERPRETATION AND ENFORCEMENT OF THE PROVISIONS OF
THIS AGREEMENT AND OF THE DOCUMENTS REFERRED TO IN THIS AGREEMENT, AND IN
RESPECT OF THE TRANSACTIONS CONTEMPLATED HEREBY AND THEREBY. EACH PARTY HERETO
HEREBY WAIVES, AND AGREES NOT TO ASSERT, AS A DEFENSE IN ANY ACTION, SUIT OR
PROCEEDING FOR THE INTERPRETATION OR ENFORCEMENT HEREOF OR OF ANY SUCH DOCUMENT
OR IN RESPECT OF ANY SUCH TRANSACTION, THAT IT IS NOT SUBJECT TO SUCH
JURISDICTION, THAT SUCH ACTION, SUIT OR PROCEEDING MAY NOT BE BROUGHT OR IS NOT
MAINTAINABLE IN SUCH COURTS, THAT THE VENUE THEREOF MAY NOT BE APPROPRIATE OR
THAT THIS AGREEMENT OR ANY SUCH DOCUMENT MAY NOT BE ENFORCED IN OR BY SUCH
COURTS. EACH PARTY HERETO HEREBY CONSENTS TO AND GRANTS ANY SUCH COURT
JURISDICTION OVER THE PERSON OF SUCH PARTIES AND OVER THE SUBJECT MATTER OF ANY
SUCH DISPUTE AND AGREES THAT MAILING OF PROCESS OR OTHER PAPERS IN CONNECTION
WITH ANY SUCH ACTION OR PROCEEDING IN THE MANNER PROVIDED IN SECTION 5.1 OR IN
SUCH OTHER MANNER AS MAY BE PERMITTED BY LAW, SHALL BE VALID AND SUFFICIENT
SERVICE THEREOF.
(b) EACH PARTY ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY WHICH MAY
ARISE UNDER THIS AGREEMENT IS LIKELY TO INVOLVE COMPLICATED AND DIFFICULT
ISSUES, AND THEREFORE EACH SUCH PARTY HEREBY IRREVOCABLY AND UNCONDITIONALLY
WAIVES ANY RIGHT SUCH PARTY MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY
LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT,
OR THE BREACH, TERMINATION OR VALIDITY OF THIS AGREEMENT, OR THE TRANSACTIONS
CONTEMPLATED BY THIS AGREEMENT. EACH PARTY CERTIFIES AND ACKNOWLEDGES
14
19
THAT (1) NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS
REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE
EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER, (2) SUCH PARTY
UNDERSTANDS AND HAS CONSIDERED THE IMPLICATIONS OF THIS WAIVER, (3) SUCH PARTY
MAKES THIS WAIVER VOLUNTARILY, AND (4) SUCH PARTY HAS BEEN INDUCED TO ENTER INTO
THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN
THIS SECTION 5.3(b).
Section 5.4. Binding Effect. This Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective heirs,
successors and permitted assigns.
Section 5.5. Assignment. This Agreement shall not be assignable or
otherwise transferable by any party hereto without the prior written consent of
the Company, NCP-SBG, and any purported assignment or other transfer without
such consent shall be void and unenforceable; provided that NCP-SBG may assign
this Agreement or any of their rights and obligations hereunder to any of their
respective Affiliates or any other Person.
Section 5.6. No Third Party Beneficiaries. Nothing in this Agreement
shall confer any rights upon any person or entity other than the parties hereto
and their respective heirs, successors and permitted assigns.
Section 5.7. Amendment; Waivers, etc. No amendment, modification or
discharge of this Agreement, and no waiver hereunder, shall be valid or binding
unless set forth in writing and duly executed by NCP-SBG and the party against
whom enforcement of the amendment, modification, discharge or waiver is sought.
Any such waiver shall constitute a waiver only with respect to the specific
matter described in such writing and shall in no way impair the rights of the
party granting such waiver in any other respect or at any other time. Neither
the waiver by any of the parties hereto of a breach of or a default under any of
the provisions of this Agreement, nor the failure by any of the parties, on one
or more occasions, to enforce any of the provisions of this Agreement or to
exercise any right or privilege hereunder, shall be construed as a waiver of any
other breach or default of a similar nature, or as a waiver of any of such
provisions, rights or privileges hereunder. The rights and remedies herein
provided are cumulative and none is exclusive of any other, or of any rights or
remedies that any party may otherwise have at law or in equity.
Section 5.8. Legend on Stock Certificates. A copy of this Agreement
shall be filed with the Secretary of the Company and kept with the records of
the Company.
15
20
Each certificate representing Covered Securities which are subject to this
Agreement shall be endorsed with a legend substantially to the following effect:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE BEEN ACQUIRED FOR
INVESTMENT AND HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED (THE "ACT"), AND MAY NOT BE OFFERED, SOLD, ASSIGNED, PLEDGED,
HYPOTHECATED, TRANSFERRED OR OTHERWISE DISPOSED OF (EACH, A "TRANSFER")
UNLESS AND UNTIL REGISTERED UNDER THE ACT AND ANY APPLICABLE STATE
SECURITIES LAWS OR UNLESS SUCH TRANSFER IS (A) EXEMPT FROM REGISTRATION OR
IS OTHERWISE IN COMPLIANCE WITH THE ACT AND SUCH LAWS IN THE OPINION OF
COUNSEL TO THE STOCKHOLDER, WHICH COUNSEL MUST BE, AND THE FORM AND
SUBSTANCE OF WHICH OPINION ARE, REASONABLY SATISFACTORY TO THE ISSUER AND
(B) IN COMPLIANCE WITH THE STOCKHOLDERS AGREEMENT OF THE ISSUER, DATED AS
OF JANUARY 5, 2000 AND ANY AMENDMENTS, SUPPLEMENTS OR MODIFICATIONS
THERETO (THE "STOCKHOLDERS AGREEMENT").
THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO THE
RESTRICTIONS ON TRANSFER SET FORTH IN (I) A STOCKHOLDERS AGREEMENT AND (II)
A REGISTRATION RIGHTS AGREEMENT, COPIES OF WHICH ARE AVAILABLE FOR
INSPECTION AT THE OFFICES OF THE COMPANY. NO TRANSFER OF SUCH SECURITIES
WILL BE MADE ON THE BOOKS OF THE COMPANY, AND SUCH TRANSFER SHALL BE
VOIDABLE, UNLESS ACCOMPANIED BY EVIDENCE OF COMPLIANCE WITH THE TERMS OF
SUCH AGREEMENTS.
Any stock certificate issued at any time in exchange or substitution for a
certificate bearing such legend (except a new certificate issued upon the
completion of a public distribution of securities of the Company represented
thereby or otherwise if the holder of the Shares represented by such certificate
shall have delivered to the Company an opinion of counsel, which opinion and
counsel shall be reasonably satisfactory to the Company, that the Act permits
such certificate to be issued without such legend or with a legend modified as
set forth in such opinion) shall also bear such legend. The provisions of this
Agreement shall be binding upon, and shall inure to the benefit of, the
Stockholders and all subsequent holders of Covered Securities who acquired the
same directly or indirectly from a Stockholder in a transaction or series of
transactions not involving any Public Offering.
16
21
The Company agrees that it will not transfer on its books any certificate
representing Covered Securities in violation of the provisions of this
Agreement.
Section 5.9. Entire Agreement. This Agreement constitutes the entire
agreement and supersedes all prior agreements and understandings, both written
and oral, among the parties with respect to the subject matter hereof.
Section 5.10. Severability. If any provision, including any phrase,
sentence, clause, section or subsection, of this Agreement is invalid,
inoperative or unenforceable for any reason, such circumstances shall not have
the effect of rendering such provision in question invalid, inoperative or
unenforceable in any other case or circumstance, or of rendering any other
provision herein contained invalid, inoperative, or unenforceable to any extent
whatsoever.
Section 5.11. Headings; Counterparts. The headings contained in this
Agreement are for purposes of convenience only and shall not affect the meaning
or interpretation of this Agreement. This Agreement may be executed in several
counter parts, each of which shall be deemed an original and all of which shall
together constitute one and the same instrument.
Section 5.12. Subsequent Stockholders. Each of the parties hereto
agrees that in order for any Person who after the date of this Agreement is
offered shares of Common Stock or securities exercisable for or convertible into
shares of Common Stock (or any interest therein) to become a party to this
Agreement, both the Company and such Person must execute Schedule A hereto and
duly executed copies thereof must be delivered to NCP-SBG in accordance with
Section 5.1. The Company shall maintain a register of all parties to this
Agreement which shall be available for review by any party hereto. Any transfer
of Covered Securities (or any interest therein) to a transferee required hereby
to become a party to this Agreement shall be of no effect and shall be void ab
initio unless such transferee becomes a party to this Agreement as provided in
the previous sentence.
Section 5.13. Reports. Within 60 days after the end of each fiscal
quarter, the Company shall furnish to each Stockholder an unaudited financial
report prepared in accordance with generally accepted accounting principles
applied on a consistent basis setting forth as of the end of such fiscal
quarter, a balance sheet of the Company and an income statement and a cash flow
statement for the Company for such fiscal quarter.
Section 5.14. Certain Agreements. The Stockholders party to that
certain Stockholders' Agreement, dated as of October 13, 1998, by and among the
Company, ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇ and ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, and that certain
Stockholders'
17
22
Agreement, dated as of October 22, 1998, between ▇▇▇▇▇ ▇▇▇▇▇▇ and ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, agree to terminate or cause to be terminated, as of the Effective
Time, such stockholders' agreements.
Section 5.15. Effectiveness. The effectiveness of this Agreement is
conditioned upon the occurrence of the Effective Time as contemplated by the
Recapitalization Agreement. If the Effective Time does not occur, or the
Recapitalization Agreement is terminated in accordance with its terms, this
Agreement shall be of no force or effect.
18
23
IN WITNESS WHEREOF, the parties have duly executed this Agreement as
of the date first above written.
SARATOGA BEVERAGE GROUP, INC.
By: /s/ ▇▇▇ ▇▇▇▇▇
------------------------------------------
Name: ▇▇▇ ▇▇▇▇▇
Title: Chief Financial Officer
NCP-SBG, L.P.
By: NCP-SBG, GP, L.L.C.,
its General Partner
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
--------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Executive Vice President
/s/ ▇▇▇▇▇ ▇▇▇▇▇▇ Address: ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇.
---------------------------------------
▇▇▇▇▇ ▇▇▇▇▇▇ A-1703
▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
/s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ Address: c/o Morgan ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
---------------------------------------
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
/s/ ▇▇▇▇▇▇ ▇▇▇▇▇ Address: ▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
---------------------------------------
▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
[Signature page for Stockholders Agreement]
24
STEEL PARTNERS II, L.P. Address: c/o Steel Partners II, L.P.
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇., ▇▇▇▇ ▇▇▇▇▇
By: STEEL PARTNERS, L.L.C., ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
its General Partner
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇
--------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇
Title: Managing Member
[Signature page for Stockholders Agreement]
25
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇▇ Address: c/o Steel Partners II, L.P.
----------------------------- ▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇., ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
26
PERSHING SECURITIES LIMITED Address: ▇▇▇▇▇▇▇ ▇▇▇▇▇
#▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇ Dock
By: /s/ Christiane ▇▇▇ ▇▇▇▇▇▇▇▇
------------------------------------- ▇▇▇▇▇▇ ▇▇▇ ▇▇▇
Name: Christiane ▇▇▇ ▇▇▇▇▇▇▇▇ England
Title: Compliance Officer
[Signature page for Stockholders Agreement]
27
/s/ ▇▇▇▇ ▇▇▇▇▇▇ Address: c/o Investa AG
-----------------------------------
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇ 4127
[Signature page for Stockholders Agreement]