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EXHIBIT 10.12
▇▇▇▇▇▇▇ HOLDINGS, INC.
FIRST AMENDED AND RESTATED SHAREHOLDERS' AGREEMENT
THIS FIRST AMENDED AND RESTATED SHAREHOLDERS' AGREEMENT (this
"Agreement") dated as of December 4, 1996, by and between ▇▇▇▇▇▇▇ HOLDINGS,
INC., a Texas corporation (the "Corporation"), and each of the individuals and
entities described on Schedule A attached hereto and incorporated herein by
reference, all of whom appear as signatories hereto (each sometimes hereinafter
referred to individually as a "Shareholder" and collectively as the
"Shareholders"), and the spouse of each of the Shareholders, if any;
W I T N E S S E T H:
WHEREAS, the Corporation is incorporated under the laws of the State
of Texas with an authorized capitalization of 100,000,000 shares of common
stock, $.01 par value (the "Common Stock") and 50,000,000 shares of preferred
stock, $.01 par value;
WHEREAS, all of the Common Stock currently issued and outstanding is
owned by the Shareholders as reflected on Schedule A attached hereto and
incorporated herein by reference;
WHEREAS, the Corporation and the Shareholders desire to promote their
mutual interests and the interests of the Corporation by entering into certain
agreements relating to the ownership and transferability of the Common Stock;
NOW, THEREFORE, in consideration of the mutual promises contained
herein and other good and valuable consideration, the receipt, adequacy, and
sufficiency of which are hereby acknowledged, it is hereby agreed as follows:
1. Definitions. As used in this Agreement:
(a) Stock. The term "Stock" means the Common Stock of the
Corporation (whether presently or hereafter issued and outstanding) and
any security of the Corporation convertible into such stock and any right
to purchase or acquire any such stock or any security convertible into
such stock. Moreover, all references herein to Stock owned by any
Shareholder include the community interest, if any, of the spouse of such
Shareholder in such Stock.
(b) Shareholders. The term "Shareholders" includes each person (and
such person's spouse) and entity identified as a Shareholder on the
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signature pages hereof as well as each other person (and such person's
spouse) and entity as may hereafter become holders of the Stock of the
Corporation, and shall include the heirs, executors, administrators,
successors and assigns of a Shareholder.
(c) Disposition. The term "Disposition" means any sale, assignment,
gift, exchange, distribution, charge, transfer, pledge, mortgage or other
encumbrance, or any other disposition of Stock (or any interest therein)
whatsoever, whether voluntary or involuntary, direct or indirect, and each
and every transaction occurring by operation of law or otherwise, which has
the purpose or effect of making one or more of the following changes:
(i) a change in the ownership of any of the Stock covered by
this Agreement or any stock certificate or certificates representing
such shares of Stock; or
(ii) in the case of a person who is not a natural person, a
change in the identity, ownership or control of the holder or owner of
the legal or equitable title of or to any of the shares of Stock
covered by this Agreement or any stock certificate or certificates
representing such shares of Stock;
and shall include the failure of a Shareholder to succeed to the community
interest of such Shareholder's spouse in the Stock upon termination of the
marital relationship of the Shareholder by death or divorce; provided,
however, that such term shall not include any transfer pursuant to or
resulting from the acquisition by a Shareholder of all or any part of the
interest, community or otherwise, of such Shareholder's spouse in any
shares of Stock covered by this Agreement.
(d) Agreed Value Per Share of Stock. The term "Agreed Value Per Share
of Stock" means the fair market value per share of Stock as determined
from time to time by the Board of Directors of the Corporation. If any
Shareholder, or his heirs, executor, administrator or former spouse,
required to offer or sell Stock under Sections 4, 5, 6, 8 or 9 at such
price objects to the Agreed Value Per Share of Stock determined as set
forth above and notifies the Corporation and all of the other Shareholders
of such objection within ten days of the respective Trigger Date (as
hereinafter defined), then the Agreed Value Per Share of Stock on the
Trigger Date (as hereinafter defined), or a date as close as is reasonably
possible to the Trigger Date, to be determined as soon as possible after
the Trigger Date, shall be determined by an independent appraiser chosen
by the Board of Directors of the Corporation who shall be experienced in
valuation of privately held
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companies owning energy reserves as a substantial portion of their asset
value. Such appraiser shall be required to determine the Agreed Value Per
Share of Stock, taking into consideration such factors as he/she deem
advisable. In determining the value of oil and gas reserves, the appraisal
firm shall attribute a value of ninety percent (90%) of proved reserves,
sixty percent (60%) of proved behind pipe reserves, and twenty-five percent
(25%) of proved undeveloped reserves, all at a value based upon the
appraiser's best estimate of future oil and gas prices and utilizing a
present value discounting factor of 10%. All other assets and all
liabilities shall be determined as of the regular unaudited balance sheet
of the Corporation as determined from time to time. All fees and expenses
incurred in connection with such appraisal shall be borne one-half (1/2) by
the Corporation and one-half (1/2) by the objecting Shareholders.
(e) Trigger Date. The term "Trigger Date" means (i) in the case of a
purchase of Stock under Section 4 hereof, the date the written notice
specified in Section 4(a) is sent by the Corporation, (ii) in the case of a
purchase of Stock under Section 5 hereof, the date of death of the spouse
of the Shareholder or the date the decree of divorce of the Shareholder
becomes a final judgment, whichever is applicable, (iii) in the case of a
purchase of Stock under Section 6 hereof, the date on which the Selling
Shareholder sends the Corporation the Offering Notice required by Section
6, or (iv) in the case of a purchase of Stock under Section 9, the date of
death of the Shareholder.
(f) Determination Date. The term "Determination Date" means (i) in
all cases where an appraisal is not required to determine the purchase
price of the Stock being sold, ten days after the Trigger Date, and (ii) in
all cases where an appraisal under Section 1(d) is required to determine
the purchase price of the Stock being sold, the date upon which the report
with respect to the final appraisal required thereunder is delivered to the
Corporation.
2. Provisions of General Applicability. For purposes of this
Agreement:
(a) Pro Rata Offers of Stock. Whenever any Shareholder is required
under this Agreement to offer Stock to the Shareholders, such offer shall
be deemed to be made, to the Shareholders pro rata in accordance with their
respective holdings at the time of the offer of, shares of Stock
(determined exclusive of the Stock held by the offering Stockholder) or in
such other proportions as all of the Shareholders (excluding the offering
Shareholder) may agree upon among themselves. Except as may otherwise be
agreed among all Shareholders (excluding the offering Shareholder) each
such Shareholder to whom Stock is so offered, shall have the right to
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purchase that proportion of the number of shares of such offered Stock
which the number of shares of Stock owned by each such Shareholder bears to
the total number of shares of Stock owned by all such Shareholders electing
to accept the offer.
(b) Corporate Action. Whenever any Stock is offered to the
Corporation pursuant to this Agreement, the determination of the
Corporation to accept or reject such offer shall be made by the Board of
Directors of the Corporation. Any director of the Corporation who is (i)
the offering Shareholder, (ii) if the offering Shareholder is a
corporation, a director, officer or shareholder of the offering
Shareholder, (iii) if the offering Shareholder is a trust, a trustee or
beneficiary of the offering Shareholder, or (iv) if the offering
Shareholder is a partnership, a partner of such partnership or an officer,
director or shareholder of any corporate partner of such partnership, shall
be disqualified and abstain from voting on any such determination. In the
event that all directors are disqualified and abstain pursuant to the
preceding sentence, then the determination of the Corporation to accept or
reject such offer shall be made by vote of the Shareholders (other than the
offering Shareholder).
3. Rights of First Refusal on Stock. If any Shareholder desires to
sell any Stock owned or held by such Shareholder in a bona fide third-party
transaction for cash or a combination of cash and one or more promissory notes
or other debt securities secured only by such Stock, and if all Shareholders do
not consent to such sale as provided in Section 7 or the transaction is not
otherwise permitted by this Agreement, then such Shareholder (for purposes of
this Section 3, the "Selling Shareholder"), prior to making such sale, shall
first offer such shares (for purposes of this Section 3, the "Option Stock")
for sale to the Shareholders as set forth in Section 2(a) hereof, and if such
offer is not accepted by the Shareholders, then to the Corporation, all in
accordance with the following provisions and on the terms and conditions set
forth in this Section 3. Each Shareholder agrees that he will not sell any
Stock to any third party for consideration other than cash, promissory notes or
other securities.
(a) Option Price; Terms; Offering Notices. The price at which the
Selling Shareholder shall be required to offer the Option Stock, and the
terms of such offer, shall be the price at which and the terms upon which
any proposed third-party purchaser shall have offered in writing to
purchase the Option Stock from the Selling Shareholder and which the
Selling Shareholder is prepared to accept. Each offer required to be made
by the Selling Shareholder pursuant to this Section 3 shall be made by a
written notice (for purposes of this Section 3, the "Offering Notice")
which shall state that the offer is being made pursuant to Section 3 of
this Agreement and which shall set forth the number of shares of Option
Stock, the name or names of the proposed purchaser or purchasers of the
Option Stock, the price offered by
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such proposed purchaser or purchasers for the Option Stock (the "Option
Price"), the method of payment of the Option Price and the scheduled date
of consummation of such proposed sale. A copy of the written offer from any
proposed third-party purchaser shall be attached to each Offering Notice.
(b) Offer to Shareholders. The Selling Shareholder shall first offer
the Option Stock to the Shareholders, as set forth in Section 2(a) hereof,
by delivering an Offering Notice to each of them. Within 30 days from the
date of receipt of the Offering Notice, each of the Shareholders shall
deliver to the Selling Shareholder a reply notice accepting or rejecting
the offer of the Option Stock. If by such reply notice one or more of the
Shareholders accepts the offer made by the Selling Shareholder, the reply
notice shall constitute an agreement binding on the Selling Shareholder and
those Shareholders accepting the offer to sell and purchase the Option
Stock at the Option Price. If within such 30-day period, one or more
Shareholders shall have failed to deliver one or more reply notices
accepting the offer of the Selling Shareholder as to all of the Option
Stock, each of such Shareholders shall be deemed to have rejected such
offer.
(c) Lapse of Options. If none of the options provided for in this
Section 3 have been exercised, the Selling Shareholder may sell not less
than all of the Option Stock at any time within, but not subsequent to, 90
days after the lapse of all options granted pursuant to this Section 3;
provided, however, that (i) no sale of all or a part of the Option Stock
shall be made at any price lower than the Option Price or on terms
materially different from those specified in the Offering Notice or to any
person or persons other than the person or persons specified in the
Offering Notice, and (ii) the person or persons to whom the Option Stock is
to be transferred enter into an Addendum Agreement in substantially the
form of Exhibit A attached hereto, pursuant to which such person or persons
agree to be bound by all of the terms and provisions of this Agreement. If
after the lapse of the 90-day period the Option Stock shall not have been
sold, all of the provisions of this Agreement, including the provisions of
this Section 3, shall apply to any future Disposition or proposed
Disposition of Stock owned by the Selling Shareholder.
(d) Consummation of Purchases. Each transaction of purchase and sale
of Option Stock pursuant to this Section 3 shall be completed by delivery
of the stock certificates representing the Option Stock endorsed in blank,
or accompanied by duly executed stock powers or assignments, as
appropriate, and by actual registration of the transfer of the Option Stock
on the books of the Corporation upon payment of the purchase price to the
Selling Shareholder. Any such transaction shall be closed at such time and
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place as shall be agreed upon by the parties thereto, or, if no such
agreement is reached, at the principal office of the Corporation on the
thirtieth (30th) day following the later of the expiration of the thirty
day reply period described in Section 3(b) or the date of delivery of the
last reply notice given in connection with such transaction or, if such
day shall not be a business day, on the first business day thereafter
during normal business hours.
4. Options Upon Termination of Marriage of an Individual
Shareholder. If the marriage of an individual Shareholder is terminated by the
death of his spouse or by divorce, and if such Shareholder does not succeed to
all of his spouse's community interest, if any, in the Stock held by him at the
time of such termination, then such Shareholder shall notify the Corporation
within ten days of such event, and shall have a first option, and if such
Shareholder does not exercise such option, the Shareholders shall have a second
option, in accordance with the provisions of Section 2(a) hereof, and if such
Shareholders do not exercise such option, the Corporation shall have a third
option, to purchase from the former spouse of such Shareholder, or from the
executor, administrator or heirs of the former spouse of such Shareholder, as
the case may be, all (but not less than all) of the interest of such former
spouse, heirs, executor or administrator, as the case may be, in such shares
(the "Option Stock"), in accordance with the following provisions of this
Section 4. As used in the following paragraphs of this Section 4, the term
"Selling Shareholder" means the former spouse of any individual Shareholder who
shall have been divorced or, in the event of the death of the spouse of a
Shareholder, the executor, administrator or heirs of such spouse's estate, as
the case may be, and the term "Individual Shareholder" means the Shareholder
who shall have been divorced or whose spouse shall have died.
(a) Option Price. The price per share at which the Individual
Shareholder, the Shareholders or the Corporation shall be entitled to
purchase the Option Stock shall be the Agreed Value Per Share of Stock at
the Trigger Date. The price at which shares of Stock are purchasable under
this Section 4 is referred to in this Section 4 as the "Option Price."
Within 30 days following the Determination Date, the Corporation shall send
to each Shareholder a notice setting forth the Option Price.
(b) Exercise by Individual Shareholder. If the Individual
Shareholder wishes to exercise his option with respect to the Option
Stock, he shall do so by delivering to the Selling Stockholder, within 30
days from the receipt of the notice from the Corporation provided for in
paragraph (a) of this Section 4, a notice to such effect. If by such notice
the Individual Shareholder elects to exercise such option, such notice
shall constitute an agreement binding on the Selling Shareholder and the
Individual Shareholder to sell and purchase the Option Stock at the Option
Price.
(c) Exercise by Shareholders. If the option of the Individual
Shareholder shall not be exercised by him as provided in paragraph (b) of
this
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Section 4, and if any Shareholders wish to exercise their option with
respect to the Option Stock, they shall do so by delivering to the
Selling Shareholder, within 30 days from the expiration of the 30-day
period referred to in paragraph (b) of this Section 4, a notice to such
effect. If by such notice, any such Shareholders elect to exercise such
option, such notice shall constitute an agreement binding on the
Selling Shareholder and such Shareholders to sell and purchase the
Option Stock at the Option Price.
(d) Exercise by Corporation. If the option in favor of the
Shareholders shall not be exercised by any them as provided in
paragraph (c) of this Section 4, and if the Corporation wishes to
exercise its option with respect to the Option Stock, then the
Corporation shall deliver to the Selling Shareholder, within 30 days
following the expiration of the 30 days following the expiration of the
30-day period referred to in paragraph (c) of this Section 4, a notice
stating its intent to exercise such option. Such notice shall
constitute an agreement binding on the Selling Shareholder and the
Corporation to sell and purchase the Option Stock at the Option Price.
(e) Lapse of Options. If none of the options provided for in this
Section 4 have been timely exercised, then such options shall expire,
but all of the provisions of this Agreement shall apply to any future
Disposition or Proposed Disposition of Stock owned or held by the
Selling Shareholder.
(f) Consummation of Purchases. If any option provided for in this
Section 4 shall be timely exercised as provided in this Section 4, the
purchase and sale of the Option Stock shall be completed by delivery of
the certificates representing such Option Stock endorsed in blank, or
accompanied by duly executed stock powers or assignments, as
appropriate, and by actual registration of the transfer of such Option
Stock on the books of the Corporation upon payment in cash of the
Option Price to the Selling Shareholder. Any such transaction shall be
closed as such time and place as shall be agreed upon by the parties
thereto, or, if no such agreement is reached, at the principal office
of the Corporation on the tenth (10th) day following the date of
delivery of any notice of exercise given to the Selling Shareholders
pursuant to paragraph (b),(c) or (d) of this Section 4, whichever is
applicable, or if such day shall not be a business day, on the first
business day thereafter during normal business hours.
5. Involuntary Disposition of Stock. Upon the reasonable belief of
a Shareholder that any of the shares of Stock owned by such Shareholder are or
will be subject to an involuntary Disposition, and in any event upon or prior to
any involuntary Disposition of such shares of Stock, such Shareholder shall
deliver an offering notice (the "Offering Notice") to the Corporation and to the
Shareholders setting forth the events giving rise to the delivery of the
Offering Notice. Upon
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receipt of the Offering Notice by the Corporation, the Shareholders shall have
a first option, as set forth in Section 2(a) hereof, and if such Shareholders
do not exercise such option, the Corporation shall have a second option, to
purchase from such Shareholder all (but not less than all) of such
Shareholder's interest in such shares (for purposes of this Section 5 the
"Option Stock"), in accordance with the following provisions of this Section 5.
For purposes of this Section 5, "involuntary Disposition" shall include,
without limitation, any Disposition or other transfer of shares of Stock
pursuant to or by reason of or under judicial order, legal or equitable
process, execution, attachment or enforcement of a pledge, trust or other
security interest or encumbrance. As used in the following paragraphs of this
Section 5, the term "Selling Shareholder" means the Shareholder who owns such
shares of stock subject to the involuntary Disposition, or his representative,
as the case may be.
(a) Option Price. The price per share at which the Shareholders or the
Corporation shall be entitled to purchase Option Stock shall be the Agreed
Value Per Share of Stock at the Trigger Date. The price at which shares of
Stock are purchasable under this Section 5 is referred to in this Section 5
as the "Option Price." Within ten (10) days following the Determination
Date, the Corporation shall send to each Shareholder a notice setting forth
the Option Price.
(b) Exercise by Shareholders. If any Shareholder wishes to exercise
his option with respect to the Option Stock, he shall do so by delivering
to the Selling Shareholder, within ten (10) days from the receipt of the
notice from the Corporation provided for in paragraph (a) of this Section
5, a notice to such effect. If by such notice, any such Shareholder elects
to exercise such option, such notice shall constitute an agreement binding
on the Selling Shareholder and such Shareholder to sell and purchase the
Option Stock at the Option Price.
(c) Exercise by Corporation. If the option in favor of the
Shareholders shall not be exercised by any of them as provided in paragraph
(b) of this Section 5, and if the Corporation wishes to exercise its option
with respect to the Option Stock, then the Corporation shall deliver to the
Selling Shareholder, within ten (10) days following the expiration of the
10-day period referred to in paragraph (b) of this Section 5, a notice
stating its intent to exercise such option. Such notice shall constitute an
agreement binding on the Selling Shareholder and the Corporation to sell
and purchase the Option Stock at the Option Price.
(d) Lapse of Options. If none of the options provided for in this
Section 5 shall have been exercised within the applicable 10-day periods
set forth above, then such options shall expire, but all of the provisions
of this
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Agreement shall apply to any future Disposition or proposed Disposition
of Stock owned or held by the Selling Shareholder.
(e) Consummation of Purchases. If any option provided for in this
Section 5 shall be timely exercised as provided in this Section 5, the
purchase and sale of the Option Stock shall be completed by delivery of
the certificates representing such Option Stock endorsed in blank, or
accompanied by duly executed stock powers or assignments, as
appropriate, and by actual registration of the transfer of such Option
Stock on the books of the Corporation upon payment in cash of the
Option Price to the Selling Shareholder. Any such transaction shall be
closed at such time and place as shall be agreed upon by the parties
thereto, or, if no such agreement is reached, at the principal office
of the Corporation on the tenth (10th) day following the date of
delivery of any notice of exercise given to the Selling Shareholder
pursuant to paragraph (b) or (c) of this Section 5, whichever is
applicable, or if such day shall not be a business day, on the first
business day thereafter during normal business hours.
6. Permitted Dispositions. No Disposition of Stock may be made by any
Shareholder (a) except in accordance with the terms of this Agreement or (b) (i)
unless all Shareholders other than the Shareholder making the Disposition
consent in writing to the transfer and (ii) any person other than a current
Shareholder to whom shares are to be so transferred executes an Addendum
Agreement in the form of Exhibit A attached hereto, pursuant to which such
person agrees to be bound by all of the terms and provisions of this Agreement.
7. Voting for Directors. In connection with any annual or special
meeting of the Shareholders for the purposes of electing Directors to the Board
of Directors of the Corporation, each of ▇▇▇▇▇ ▇. ▇▇▇▇ ("▇▇▇▇"), ▇▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ and ▇▇▇ ▇. ▇▇▇▇▇ shall have the right
to designate one nominee for membership on the Board of Directors of the
Corporation. The foregoing right to designate a nominee to the Board of
Directors shall terminate for any individual who no longer is a Shareholder, and
upon such occurrence that person's nominee on the Board of Directors shall
immediately resign. Each of the Shareholders covenant and agree that they will
vote all of their shares of Stock (i) in such a manner that the number of
Directors to serve on the Board of Directors of the Corporation shall be, and
shall thereinafter remain, five (5); and (ii) for each nominee designated by
certain of the Shareholders pursuant to this Section 7. Notwithstanding anything
to the contrary contained herein, no matter requiring approval of the
Shareholders shall be deemed to have taken place unless not only the requisite
vote of the outstanding shares does occur, but in addition the approval of ▇▇▇▇
shall have been procured so long as ▇▇▇▇ owns at least thirty percent (30%) or
more of the issued and outstanding shares of the Corporation.
8. Death of Individual Shareholders.
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(a) Purchase by Corporation. Upon the death of any individual
Shareholder, the Corporation will be obligated to purchase the Stock
owned by the deceased Shareholder, and the estate of said Shareholder
will sell all such shares of Stock now owned or hereafter acquired by
such Shareholder or his or her spouse, if any.
(b) Purchase Price. The price per share at which the Corporation
will purchase the Stock (the "Purchase Price") will be equal to the
Agreed Value Per Share of Stock as of the Trigger Date.
(c) Consummation of Purchases. Upon receipt of the cash payment
due and owing for the purchase of the Stock of the deceased
Shareholder, the estate of the deceased Shareholder will deliver the
certificate(s) representing the Stock being purchased by the
Corporation, endorsed in blank or accompanied by duly executed stock
powers or assignments, as appropriate, and by actual registration of
the transfer of the Stock on the books of the Corporation upon payment
of the Purchase Price to the estate of the deceased Shareholder. Any
such transaction will be closed at such time and place as agreed upon
by the parties thereto, or, if no such agreement is reached, at the
principal office of the Corporation on the ninetieth (90th) day
following the Trigger Date or, if such day is not a business day, on
the first business day thereafter, during normal business hours.
9. Disposition by Shareholder upon Termination of Employment.
(a) Obligation of the Company. Upon the termination of any
salaried employee Shareholder's employment with the Corporation for any
reason (other than death which is covered by Section 8 herein or
termination by the Corporation without cause), including (but not
limited to) retirement, resignation, expiration of the term of an
employment agreement, or termination by the Corporation with cause of a
Shareholder, the Corporation shall promptly notify the other
Shareholders of such event. The other Shareholders shall have a first
option, in accordance with the provisions of Section 2(a) hereof, and
if none of the Shareholders exercise such option, the Corporation shall
have a second option, to purchase from the former employee Shareholder
all (but not less than all) of the interest of such former employee in
such shares (the "Option Stock"), in accordance with the following
provisions of this Section 9. As used in the following paragraphs of
this Section 9, the term "Selling Shareholder" means the former
employee Shareholder.
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(b) Option Price. The price per share at which the Selling
Shareholder, the other Shareholders or the Corporation shall be
entitled to purchase the Option Stock shall be the Agreed Value Per
Share of Stock at the Determination Date. The price at which shares of
Stock are purchasable under this Section 9 is referred to in this
Section 9 as the "Option Price." Within thirty (30) days following the
Trigger Date, the Corporation shall send to each Shareholder a notice
setting forth the Option Price.
(c) Exercise by Shareholders. If the other Shareholders wish to
exercise their option with respect to the Option Stock, they shall do
so by delivering to the Selling Stockholder, within thirty (30) days
from the delivery of the notice referred to in paragraph (b) of this
Section 9, a notice to such effect. Such notice shall constitute an
agreement binding on the Selling Shareholder and such Shareholders to
sell and purchase the Option Stock at the Option Price.
(d) Exercise by Corporation. If the option in favor of the other
Shareholders shall not be exercised by any of them as provided in
paragraph (c) of this Section 9, and if the Corporation wishes to
exercise its option with respect to the Option Stock, then the
Corporation shall deliver to the Selling Shareholder, within thirty
(30) days following the expiration of the 30-day period referred to in
paragraph (c) of this Section 9, a notice stating their intent to
exercise such option. Such notice shall constitute an agreement binding
on the Selling Shareholder and the Corporation to sell and purchase the
Option Stock at the Option Price.
(e) Lapse of Options. If none of the options provided for in this
Section 9 have been timely exercised, then such options shall expire,
but all of the provisions of this Agreement shall apply to any future
Disposition or Proposed Disposition of Stock owned or held by the
Selling Shareholder.
(f) Consummation of Purchases. If any option provided for in this
Section 9 shall be timely exercised as provided in this Section 9, the
purchase and sale of the Option Stock shall be completed by delivery of
the certificates representing such Option Stock endorsed in blank, or
accompanied by duly executed stock powers or assignments, as
appropriate, and by actual registration of the transfer of such Option
Stock on the books of the Corporation upon payment in cash of the
Option Price to the Selling Shareholder. Any such transaction shall be
closed at such time and place as shall be agreed upon by the parties
thereto, or, if no such agreement is reached, at the principal office
of the Corporation on the tenth (10th) day following the date of
delivery of any notice of exercise given to the Selling Shareholder
pursuant to paragraph (c) or (d) of this Section 9, whichever is
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applicable, or if such day shall not be a business day, on the first
business day thereafter during normal business hours.
10. Investment Representation and Legend on Stock Certificates. Each
of the Shareholders hereby represents that as of the date any Stock was or will
be acquired by such Shareholder, such Stock was or will be acquired for such
Shareholder's own account, for investment and not with a view to the
distribution thereof. Each of the Shareholders understands that any Stock which
has been or will be acquired by such Shareholder has not been and will not be
registered under the Securities Act of 1933, as amended (the "Securities Act"),
or the securities laws of any state, pursuant to an exemption from the
registration provisions of the Securities Act and such state securities laws.
Each of the Shareholders hereby agrees that the Stock which has been or will be
acquired by such Shareholder pursuant to an exemption from the registration
provisions of the Securities Act and applicable state securities laws shall not
be sold, transferred, pledged or hypothecated unless the sale of such Stock is
registered under the Securities Act and any applicable state securities laws or
unless there is furnished an opinion of counsel satisfactory to the Corporation
that registration of such Stock under the Securities Act and applicable state
securities laws is not required. All certificates representing shares of Stock
now owned or hereafter acquired by the Shareholders shall contain an
appropriate reference on the face thereof to the following legend which shall
be endorsed on the reverse side of each such certificate.
"The transfer of the shares of stock represented by this certificate is
restricted by the terms and conditions of a First Amended and Restated
Shareholders' Agreement (the "Agreement") dated as of December 4, 1996,
among the Corporation and all of the holders of Stock of the Corporation.
As more fully set forth in the Agreement, such shares have not been
registered under the Securities Act of 1933, as amended (the "Securities
Act"), or the securities laws of any state, have been acquired for
investment and not with a view to distribution thereof, and may not be
sold, offered for sale, transferred, pledged or hypothecated unless the
sale, transfer, pledge or hypothecation of such shares is registered under
the Securities Act and any applicable state securities laws or unless
there is furnished an opinion of counsel satisfactory in form and
substance to the Corporation that registration of such shares under the
Securities Act and any applicable state securities laws is not required. A
copy of the Agreement is on file at the offices of the Corporation."
Each Shareholder understands that the Corporation is under no obligation to
register the Stock under the Securities Act. The provisions of this Section 10
shall remain in effect until, in the opinion of counsel for the Corporation,
they are no longer required.
11. Notices. Any offer, notice, request, reply, instruction or other
communication (herein severally and collectively called "Notice") in this
Agreement provided or permitted to be given to the Corporation or to any
Shareholder or spouse of a Shareholder or executor or administrator of a
deceased Shareholder shall be in writing and shall be considered to have been
sent when personally
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13
delivered or sent, first class, registered or certified mail, return receipt
requested, postage prepaid. Notice sent in the United States mail, in the
manner described, shall be effective and deemed to be received by the addressee
upon the expiration of three (3) days after deposit. Notice given in any other
manner shall be effective only when received by the party to be notified. For
purposes of Notice, the address of the Corporation shall be ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, and the respective addresses of the
Shareholders shall be the addresses hereinafter set forth next to the
signatures to this Agreement of each of the Shareholders. Any party to this
Agreement shall have the right to change his address for the purposes of this
Agreement by giving at least three (3) days' written notice of such change of
address to each of the other parties hereto in the manner set forth in this
Agreement.
12. Necessary Documents. If under the terms of this Agreement the
Stock of any Shareholder is purchased, such Shareholder or the spouse of any
Shareholder or the executor or administrator of such Shareholder, as the case
may be, shall execute and deliver at the closing as provided in this Agreement
all necessary documents that may be reasonably required for accomplishing a
complete transfer of such Stock for the purposes of the purchase contemplated
hereby in this Agreement.
13. Miscellaneous Provisions.
(a) Governing Law. This Agreement shall be subject to and governed by
the laws of the State of Texas.
(b) Arbitration. If a dispute arises out of or relates to this
Agreement, or the breach thereof, and if said dispute cannot be settled
through negotiation, the Parties agree first to try in good faith to
settle the dispute by mediation under the Commercial Mediation Rules of
the American Arbitration Association, before resorting to arbitration,
litigation, or some other dispute resolution procedure as required by this
Section 13(b). Failing an adequate resolution by mediation, any
controversy or claim arising out of or relating to this Agreement or the
transactions contemplated hereby, including any controversy or claim
arising out of or relating to the Parties' decision to enter into this
Agreement, shall be settled by binding arbitration. There shall be one
arbitrator to be mutually agreed upon by the Parties involved in the
controversy and to be selected from the Judicial Panel of the Center for
Public Resources (or successor panel, if any). If within 45 days after
service of the demand for arbitration the Parties are unable to agree upon
such an arbitrator who is willing to serve, then an arbitrator shall be
appointed by the American Arbitration Association in accordance with its
rules. Except as specifically provided in this Section 13(b), the
arbitration shall be conducted in accordance with the Commercial
Arbitration Rules of the American Arbitration Association. The arbitrator
shall not render an award of punitive damages. Any arbitration hereunder
shall be held in ▇▇▇▇▇▇
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14
County, Texas. Except as otherwise specifically provided hereinafter,
expenses related to the arbitration, including counsel fees, shall be
borne by the Party incurring such expenses. The fees of the arbitrator
and of the American Arbitration Association, if any, shall be divided
equally among the Parties involved in the controversy. Judgement upon
the award rendered by the arbitrator (which may, if deemed appropriate
by the arbitrator, include equitable or mandatory relief with respect
to performance of obligations hereunder) may be entered in any court of
competent jurisdiction. If any legal action or other proceeding is
brought for the enforcement of this Agreement, or because of an alleged
dispute, breach, default or misrepresentation in connection with any of
the provisions of this Agreement, the successful or prevailing Party or
Parties shall be entitled to recover reasonable attorneys' fees and
other costs incurred in that action or proceeding in addition to any
other remedies to which it or they may be entitled at law or equity.
(c) Gender. Whenever the context requires, the gender of all
words used herein shall include the masculine, feminine and neuter, and
the number of all words shall include the singular and plural.
(d) Binding Effect. This Agreement shall be binding upon the
Corporation, the Shareholders, the spouses of the Shareholders and
their heirs, executors, administrators, successors and assigns.
(e) Amendment. This Agreement may be amended from time to time by
an instrument in writing signed by all those who are parties to this
Agreement at the time of such amendment, such instrument being
designated on its face as an "Amendment" to this Agreement.
(f) Termination. This Agreement shall terminate automatically
upon (i) the bankruptcy or lawful dissolution of the Corporation, (ii)
the occurrence of any event which reduces the number of Shareholders to
one or (iii) the merger or consolidation of the Corporation with
another corporation (providing the Corporation is not the surviving
corporation of such merger or consolidation and provided further that
the surviving corporation is not owned or controlled, directly or
indirectly, by the Shareholders). This Agreement may also be terminated
by an instrument in writing signed by all those who are parties to this
Agreement at the time of the signing of such instrument.
(g) Rights after Sale. Any Shareholder who sells all of his Stock
shall cease to be a party to this Agreement and shall have no further
rights hereunder.
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15
(h) Joinder of Spouses. The respective spouses of the individual
Shareholders are fully aware of, understand, and fully consent and
agree to the provisions of this Agreement and its binding effect upon
any community or other property interest that they may now or hereafter
own, and agree that the termination of their marital relationship with
any Shareholder, for any reason, shall not have the effect of removing
any Stock of the Corporation otherwise subject to this Agreement from
the coverage hereof and that their awareness, understanding, consent
and agreement are evidenced by their execution of this Agreement. If at
any time hereafter a natural person shall become a party to this
Agreement, then the spouse of such natural person, by execution of an
Addendum Agreement in the form of Exhibit A attached hereto pursuant to
which such Shareholder shall adopt this Agreement, shall evidence and
acknowledge that such spouse is fully aware of, understands and agrees
to the provisions of this Agreement and its binding effect upon any
interest, community or otherwise, such spouse may at any time own in
any shares of Stock, and by such execution such spouse will agree that
the termination of marriage to such natural person for any reason shall
not have the effect of removing any shares of Stock otherwise subject
to this Agreement from the coverage hereof.
(i) Attempted Disposition as Breach. Any attempted Disposition in
breach of this Agreement shall be null and void. Each party hereto
acknowledges that a remedy at law for any breach or attempted breach of
any of Sections 3 through 8 shall be inadequate, agrees that each other
party hereto shall be entitled to specific performance and injunctive
and other equitable relief in case of any such breach or attempted
breach, and further agrees to waive any requirement for the securing or
posting of any bond in connection with the obtaining of any such
injunctive or other equitable relief.
(j) Addendum Agreement. No Shareholder shall transfer shares of
Stock, or allow any Disposition of such Shareholder's Stock, and the
Corporation shall not issue shares of Stock, to any person who is not
already a party hereto, unless such person and the spouse of such
person, if applicable, become parties to this Agreement
contemporaneously with the transfer, Disposition or issuance of such
shares. Any such person and the spouse of such person shall become
parties to this Agreement by the execution of an Addendum Agreement in
substantially the form attached hereto as Exhibit A, to be executed by
all Shareholders, which Addendum Agreement shall bind such person to,
and grant them the benefits of, this Agreement as though they were
original parties hereto.
(k) Separability. If any term or provision contained in this
Agreement is or is hereafter found to be inconsistent with, contrary
to, or
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16
invalid or unenforceable under any law or official rule, regulation or
order, this Agreement shall be deemed to be modified accordingly and
the remaining terms and provisions of this Agreement shall not be
affected thereby and shall continue in full force and effect.
(l) Power of Attorney. Each of the Shareholders hereby
irrevocably appoints and authorizes the Corporation to execute and
deliver on his or her behalf the Addendum Agreement described in
Paragraph 13(j) hereof. The Corporation's authority shall begin on the
date hereof and shall not terminate on the disability of the respective
Shareholder.
(m) Waiver. Any waiver to be enforceable must be in writing and
executed by the party against whom the waiver is sought to be enforced.
(n) Drafting. Both parties hereto acknowledge that each party
was actively involved in the negotiation and drafting of this Agreement
and that no law or rule of construction shall be raised or used in
which the provisions of this Agreement shall be construed in favor or
against either party hereto because one is deemed to be the author
thereof.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement in
multiple counterparts, each of which shall be considered an original, but all of
which together shall constitute but one and the same agreement, effective as of
the date and year first above written.
THE CORPORATION:
▇▇▇▇▇▇▇ HOLDINGS, INC.,
a Texas corporation
Address
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇
-----------------------------------
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇. ▇▇▇▇,
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇ Chief Executive Officer
17
THE SHAREHOLDERS:
Address Name
2334 Quenby /s/ ▇▇▇▇▇ ▇. ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇ ---------------------------
▇▇▇▇▇ ▇. ▇▇▇▇
/s/ ▇▇▇▇▇▇ ▇▇▇▇
---------------------------
▇▇▇▇▇▇ ▇▇▇▇, spouse
▇▇▇▇ ▇▇▇▇▇▇ ▇▇. /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇ ---------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
/s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇, M.D., spouse
16308 ▇▇▇▇▇ /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇ ---------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
/s/ ▇▇▇▇▇ ▇▇▇▇▇
---------------------------
▇▇▇▇▇ ▇▇▇▇▇, spouse
▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇ /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇ ---------------------------
▇▇▇▇▇ ▇▇▇▇▇▇▇▇
/s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
---------------------------
▇▇▇▇▇ ▇▇▇▇▇▇▇▇, spouse
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ /▇/ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇ ---------------------------
▇▇▇▇▇▇▇ ▇▇▇▇▇
/s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇
---------------------------
▇▇▇▇▇▇▇ ▇▇▇▇▇, spouse
3210 Ashfield /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇ ---------------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
/s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
---------------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, spouse
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▇▇▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇. /s/ ▇▇▇ ▇. ▇▇▇▇▇
Suite 850 ------------------------------
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ ▇▇▇ ▇. ▇▇▇▇▇
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
-------------------------------
Spouse
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SCHEDULE A
Shareholders
Shares of Common
Shareholder Stock Owned
----------- ----------------
▇▇▇▇▇ ▇. ▇▇▇▇ 450,000
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ 255,000
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ 100,000
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ 50,000
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ 20,000
▇▇▇ ▇. ▇▇▇▇▇ 50,000
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ 30,000
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