DRAFT DATED 05/09/94
5:14 PM
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Date Of Report (date of earliest event reported)
May 13, 1994
UNIVAR CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 1-5858 91-0816142
-------- ------ ----------
(State of (Commission (IRS Employer
Incorporation) File Number) Identification No.)
6100 Carillon Point
Kirkland, Washington 98033
(Address of principal executive office)
Registrant's telephone number, including area code:
(206) 889-3400
Item 5. Other Events
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Amendment of Agreements with The Dow Chemical Company
-----------------------------------------------------
On June 24, 1991, Univar Corporation (the "Registrant" or
"Univar") and The Dow Chemical Company (Dow") entered into two
agreements: (I) an Agreement of Purchase and Sale of Stock (the "Dow
Purchase Agreement"), and (II) a Standstill Agreement (the "Dow
Standstill Agreement"). [Copies of each of the Dow Purchase Agreement,
and subsequent amendments to it, and the Dow Standstill Agreement, are
filed with the Commission in File Number 1-5858 as Exhibits to various
filings made by Univar under the Securities Exchange Act of 1934.]
Univar and Dow have amended the Dow Purchase Agreement and the Dow
Standstill Agreement as described below:
A. Amendment of Dow Purchase Agreement
--------------------------------------
In accordance with the Dow Purchase Agreement as originally
entered into between Univar and Dow on June 24, 1991, Univar sold
1,900,000 shares of its common stock to Dow at a price of $15.84 per
share. In addition, Univar reserved the right to put to Dow between
approximately 2,500,000 and 2,900,000 additional shares of common stock
at a price that escalated over time, but which has reached a maximum
price of $18.74 per share. The number of additional shares that could
be sold depended on whether Pakhoed Investeringen B.V. ("Pakhoed")
exercised its right to acquire shares from Univar at the same price as
they were sold to Dow in order for Pakhoed to maintain its percentage
share ownership in Univar. Univar believes Pakhoed will elect not to
exercise its right to acquire said shares. Therefore, based on the
manner in which the calculation of the number of additional shares to
be sold is made, the actual maximum number of shares that Univar could
put to Dow at this time is 2,509,371. In lieu of the unilateral right
of Univar to put said additional shares of common stock to Dow, the
parties have amended that aspect of the Dow Purchase Agreement as
described below. Dow and Univar have executed an Amended and Restated
Agreement of Purchase and Sale of Stock, a copy of which is included as
Exhibit 2 to this Form 8-K.
In lieu of the put of 2,509,371 shares of common stock by Univar
to Dow, Univar and Dow have agreed as follows:
(I) Sale of Common Stock
------------------------
On May 13, 1994, Dow purchased from Univar 2,000,000 shares of
common stock at a price of $18.74 per share (a total purchase price of
$37,480,000). Dow now holds 3,900,000 shares of common stock
representing 18.02% of the issued and outstanding shares of Univar. In
accordance with the Dow Standstill Agreement, Dow has the right to
representation on Univar's Board of Directors proportional to its
shareholdings. Accordingly, Dow would have the right to have two Dow-
designated members on Univar's Board of Directors. However,
notwithstanding that right, Dow has elected not to designate a second
person to be a member of Univar's Board and will continue to only have
one such representative.
(II) Options For Series A Preferred Stock
-----------------------------------------
Univar has, by resolution of its Board of Directors, established a
new class of preferred stock (the "Series A Preferred Stock"). A copy
of the terms and conditions of the Series A Preferred Stock is attached
hereto as Exhibit 4(ii). In summary, the Series A Preferred Stock has
the following terms and conditions:
(i) 105,000 shares of Series A Preferred Stock have been
reserved for issuance;
(ii) the shares of Series A Preferred Stock shall not have
any right to vote on any matter presented to shareholders of Univar;
(iii) the Series A Preferred Stock is not transferable until
the shares have been converted to common stock;
(iv) dividends will be paid on each share of Series A
Preferred Stock in an amount equal to five times the dividend paid on
each share of common stock (if, as, and when paid on the common);
(v) there is no liquidation preference attached to the
Series A Preferred Stock;
(vi) each share of Series A Preferred Stock is convertible at
any time by the holder into five shares of common stock. Further, it
can be so converted at any time after three years after issuance by
Univar; and
(vii) the Series A Preferred Stock can be redeemed in whole or
in part by Univar at any time after its issuance for an amount equal to
its issue price, plus any accrued and unpaid dividends.
Dow and Univar have agreed that, at any time within the three year
period ending May 12, 1997, Univar can put to Dow, or Dow can call, up
to 101,874 shares of Series A Preferred Stock. The price per share
will be $93.70. In the event of a call or put, either all or half of
said 101,874 shares must be acquired. With respect to the conversions
of the Series A Preferred Stock into Univar common stock, Univar has
agreed in the Dow Standstill Agreement that it will not do so if,
following said conversion, Dow would own in excess of 19.9% of the
issued and outstanding common stock.
Dow has agreed that it will pay to Univar $350,000 per year, in
arrears, for each of the three years ending May 12, 1997, in the event
Univar does not elect to put the Series A Preferred Stock to Dow, or in
the event Dow does not call said Series A Preferred Stock. If there is
a put or call of the Series A Preferred Stock during said three year
period, the annual fee shall be prorated accordingly.
B. Amendment of Dow Standstill Agreement
----------------------------------------
In conjunction with the sale of 2,000,000 shares of common stock
to Dow as described above, Dow and Univar have agreed to amend certain
aspects of the Dow Standstill Agreement which was entered into between
the parties as of June 24, 1991. Each of the amendments is reflected
in the Amended and Restated Dow Standstill Agreement, a copy of which
is attached to this Form 8-K as Exhibit 4(i), including the following
material changes:
(i) Univar has agreed that, if it agrees with one or more holders
of common stock to repurchase some or all of the holders' shares, Dow
will have a right to participate in such a buy-back on a pro-rata
basis. Excluded from this participation right are transactions in
which Univar might repurchase up to 1 million shares of common stock
from Pakhoed or its affiliates on or before October 13, 1994.
(ii) The current Dow Standstill Agreement provides that, until
June 24, 1994, if Univar elects to exercise its right of first refusal
to acquire shares of common stock that Dow elects to sell, Univar may
pay Dow for such shares partly in cash and partly with a promissory
note payable in full five years after it is issued. Under the Amended
and Restated Dow Standstill Agreement, Univar will repay Dow entirely
in cash in the event Univar exercises its right of first refusal.
(iii) If Univar proposes to register shares for a public offering,
Dow has, under the current Dow Standstill Agreement, certain "piggy
back" registration rights that allow Dow to register and sell shares of
Univar common stock owned by Dow, provided that the number of shares
Dow may sell in such an offering is reduced if a managing underwriter
concludes that a reduction (i.e., a "cutback") is desirable to permit
the orderly distribution and sale of the securities being offered.
Under the Amended and Restated Dow Standstill Agreement, in the event
there is a cutback, Dow shall be able to participate in such an
offering by including not less than its pro rata portion (based on the
then current percentage of outstanding common shares held by it) of the
total amount that the underwriter concludes can be sold to the market
in the offering.
(iv) Under the current Dow Standstill Agreement, Dow is given the
right to demand that Univar register shares that Dow wishes to sell to
the public. Univar must do so not more than once per year and the
underwriter to manage such an offering is to be jointly selected by Dow
and Univar. Under the Amended and Restated Dow Standstill Agreement, a
demand registration may be required by Dow up to two times per year and
the managing underwriter will be selected by Dow, subject to the
reasonable approval by Univar of Dow's selection.
(v) A provision has been added to the Dow Standstill Agreement
that grants to Dow the equivalent of "piggy back" registration rights
in those instances where Univar elects to make a private placement of
its common stock for cash or readily marketable securities in a
transaction other than an acquisition. That is, Dow will have a right
to have some additional shares owned by it included in a private
placement to be undertaken by Univar in accordance with procedures,
including a cutback right as described at paragraph (iii) above,
corresponding to those that apply to a registered offering undertaken
by Univar.
Item 7. Financial Statements and Exhibits
- - -----------------------------------------
(c) Exhibits.
Exhibit No. Exhibit
2 Amended and Restated Agreement Of
Purchase and Sale of Stock Between
Univar Corporation and
The Dow Chemical Company dated May 13, 1994
4(i) Amended and Restated Standstill Agreement
between Univar Corporation and
The Dow Chemical Company
dated May 13, 1994
4(ii) Terms and Conditions of Series A
Preferred Stock
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant had duly caused this report to be signed on its
behalf by the undersigned hereunto duly authorized.
UNIVAR CORPORATION
Dated: May 13, 1994 By /s/ Gary E. Pruitt
--------------------------
Vice President-Finance and
Treasurer
EXHIBIT 2
Amended and Restated Agreement Of Purchase and Sale of Stock
Between Univar Corporation and The Dow Chemical Company dated May 13, 1994
AMENDED AND RESTATED
AGREEMENT OF PURCHASE AND SALE OF STOCK
THIS AMENDED AND RESTATED AGREEMENT OF PURCHASE AND SALE OF STOCK
(the "Agreement") is made and entered into as of May 13, 1994, by and
between The Dow Chemical Company, a Delaware corporation (the
"Purchaser"), and Univar Corporation, a Delaware corporation (the
"Company").
R E C I T A L S:
A. The Company and Purchaser initially entered into this
Agreement as of June 24, 1991 in connection with the purchase of the
outstanding shares of capital stock of certain subsidiaries of Kongsbo
Industrier AB ("Kongsbo"), which comprised the Beijer Industrial
Distribution Group ("Beijer"), an industrial group that was a
distributor of Purchaser's products in parts of Europe.
B. To finance a portion of the acquisition of Beijer, the
Company agreed to sell and Purchaser agreed to acquire 1,900,000
shares of the Company's common stock, $.33-1/3 par value per share
(the "Original Shares"), and the Company agreed to sell under certain
circumstances additional shares of the Company's common stock, $.33-
1/3 par value per share (the "Original Additional Shares").
C. This Agreement was amended on September 24, 1993, November
30, 1993, December 21, 1993, and February 21, 1994 and the parties
have agreed to further amend and fully restate their agreement
including provisions for an initial sale of 2,000,000 shares of the
Company's common stock, $.33-1/3 par value per share (the "Additional
Common Shares") and, at the Company's or Purchaser's option, a
subsequent sale of 101,874 shares of Series A Preferred Stock (the
"Additional Preferred Shares") in lieu of the parties' existing
agreement to purchase and sell the Original Additional Shares.
Provisions of the existing agreement with no current or future effect
have been deleted.
NOW, THEREFORE, for and in consideration of the respective
covenants, agreements, representations, and warranties contained
herein, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
As used in this Agreement:
ACT. "Act" shall have the same meaning as in the Dow Standstill
Agreement.
ADDITIONAL CLOSINGS. "Additional Closings" means the
consummation of the Company's transfer(s) to Purchaser of the
Additional Preferred Shares in exchange for certain consideration
which shall occur at the time(s) determined in accordance with Section
2.6 at the place(s) specified in Section 8.1.
ADDITIONAL CLOSING DATES. "Additional Closing Dates" means the
date(s) determined in accordance with Section 2.6 relating to the
consummation of the purchase and sale of the Additional Preferred
Shares.
ADDITIONAL COMMON SHARES. "Additional Common Shares" means the
2,000,000 shares of the Company's common stock, $.33-1/3 par value per
share, that Purchaser agrees to purchase from the Company pursuant to
this Amended and Restated Agreement of Purchase and Sale of Stock.
ADDITIONAL PREFERRED SHARES. "Additional Preferred Shares" means
the 101,874 shares of the Company's Series A Preferred Stock that
Purchaser agrees to purchase from the Company pursuant to this Amended
and Restated Agreement of Purchase and Sale of Stock.
BENEFICIAL OWNER. "Beneficial Owner" and "Beneficial Ownership"
and other derivations thereof shall have the same meaning as in the
Dow Standstill Agreement and shall be interpreted in a manner
consistent with any judicial interpretation of such term under the
Pakhoed Standstill Agreement.
CLOSING. "Closing" means the consummation of the Company's
transfer to Purchaser of the Additional Common Shares in exchange for
certain consideration which shall occur at the time and place
specified in Section 8.1.
CLOSING DATE. "Closing Date" means the date provided for in
Section 8.1 of this Agreement.
COMMISSION. "Commission" means the United States Securities and
Exchange Commission.
COMMON STOCK. "Common Stock" means shares of the Company's
common stock, $.33-1/3 par value per share or such other par value as
may be established from time to time.
COMMON STOCK EQUIVALENTS. "Common Stock Equivalents" shall have
the same meaning as in the Dow Standstill Agreement and shall be
interpreted in a manner consistent with any judicial interpretation of
such term under the Pakhoed Standstill Agreement, if such Pakhoed
Standstill Agreement is in effect as of the time such interpretation
is made.
DOW STANDSTILL AGREEMENT. "Dow Standstill Agreement" means the
agreement between Purchaser and the Company, as amended and
incorporated as Exhibit A.
ENVIRONMENTAL CLAIM. "Environmental Claim" means any notice of
violation, claim, demand, abatement order, designation as a
"Potentially Responsible Party," "Potentially Liable Property" or
other notice or order by any governmental authority or any Person for
any damage, including, without limitation, personal injury (including
sickness, disease or death), tangible or intangible property damage,
contribution, indemnity, indirect or consequential damages, damage to
the environment or natural resources, nuisance, pollution,
contamination or other adverse effects on the environment, or for
fines, penalties, costs or restrictions, resulting from or based upon
(i) the existence of a Release (whether sudden or non-sudden or
accidental or non-accidental) of, or exposure to, any Hazardous
Material in, into or onto the environment at, in, by, from or in the
vicinity of or related to any property owned or leased by the Company
or any of the Subsidiaries, (ii) the use, generation, handling,
transportation, storage, treatment or disposal of Hazardous Materials
in connection with the operation of any property owned or leased by
the Company or any of the Subsidiaries, or (iii) the violation, or
alleged violation, of any statutes, ordinances, orders, rules,
regulations, permits, licenses or authorizations (including, without
limitation, all Environmental Laws) of or from any governmental
authority relating to environmental matters connected with any
property owned or leased by the Company or any of the Subsidiaries.
ENVIRONMENTAL LAWS. "Environmental Laws" means all applicable
laws, statutes, ordinances, orders, rules and regulations relating to
environmental matters, including, without limitation, those relating
to the Release or threatened Release of Hazardous Materials and to the
generation, use, storage, transportation, or disposal of Hazardous
Materials, in any manner applicable to Company or any of its
Subsidiaries or any of their respective properties, including, without
limitation, the Comprehensive Environmental Response, Compensation,
and Liability Act (42 U.S.C. 9601 et seq.), the Hazardous Material
Transportation Act (49 U.S.C. 1801 et seq.), the Resource
Conservation and Recovery Act (42 U.S.C. 6901 et seq.), the Federal
Water Pollution Control Act (33 U.S.C. 1251 et seq.), the Clean Air
Act (42 U.S.C. 7401 et seq.), the Toxic Substances Control Act (15
U.S.C. 2601 et seq.), the Occupational Safety and Health Act (29
U.S.C. 651 et seq.) and the Emergency Planning and Community Right-
to-Know Act (42 U.S.C. 11001 et seq.) and environmental protection,
including, without limitation, the National Environmental Policy Act
(42 U.S.C. 4321 et seq.) and applicable state or provincial laws,
each as amended or supplemented, and any similar or analogous local,
state or provincial and federal statutes and regulations promulgated
pursuant thereto, each as in effect as of the date of this Agreement.
HAZARDOUS MATERIALS. "Hazardous Materials" means (i) any
chemical, material or substance defined as or included in the
definition of "hazardous substances," "hazardous wastes," "hazardous
materials," "extremely hazardous waste," "restricted hazardous waste,"
or "toxic substances" or words of similar import under applicable
Environmental Laws; (ii) (A) oil, natural gas, petroleum or petroleum
derived substance, any drilling fluids, produced waters and other
wastes associated with the exploration, development or production of
crude oil, natural gas or geothermal fluid, any flammable substances
or explosives, any radioactive materials, any hazardous wastes or
substances, any toxic wastes or substances or (B) any other materials
or pollutants that (1) pose a hazard to any property of Company or any
of its Subsidiaries or to Persons on or about such property or to any
other property that may be affected by the Release of such materials
or pollutants from property of Company or its Subsidiaries or to
Persons on or about such property or (2) cause such property or such
other property to be in violation of any Environmental Law; (iii)
asbestos, urea formaldehyde foam insulation, toluene, polychlorinated
biphenyls in excess of fifty parts per million; and (iv) any other
chemical, material or substance, exposure to which is prohibited,
limited or regulated by any applicable governmental authority.
KNOWLEDGE. "Knowledge" "known" and "to the best of Company's
knowledge" and derivations thereof, shall mean the actual knowledge of
the Company's officers after reasonable inquiry.
MARKET PRICE. "Market Price" means the average of the high and
low prices of the Common Stock quoted on any day on the New York Stock
Exchange, or if not listed thereon, any exchange on which the Common
Stock may at the time be listed, or, if there shall have been no sales
on such exchange on such day, the average of the mean between the bid
and asked prices at the end of such day, or if the Common Stock shall
not be so listed, the average of the high and low prices of the Common
Stock on such day quoted on the National Association of Securities
Dealers, Inc. Automated Quotation System, or if the Common Stock is
not so quoted, the average of the mean between the bid and asked
prices per share on such day in the over-the-counter market as
reported by a generally accepted reporting service.
OPTION. Subject to the terms set forth in this Agreement,
"Option" means the reciprocal rights of (i) the Company to put to
Purchaser and (ii) the Purchaser to call from the Company, 101,874
shares of the Series A Preferred Stock.
ORIGINAL ADDITIONAL SHARES. "Original Additional Shares" means
the shares of the Company's common stock, $.33-1/3 par value per share
with respect to which Purchaser and the Company had previously agreed
to purchase and sell, which has been superseded by the terms of this
amended and restated Agreement.
PAKHOED. "Pakhoed" shall have the same meaning as in the Dow
Standstill Agreement.
PAKHOED STANDSTILL AGREEMENT. "Pakhoed Standstill Agreement"
shall have the same meaning as in the Dow Standstill Agreement.
PERSON. "Person" means any individual, partnership, corporation,
joint venture, or other entity.
PREFERRED STOCK. "Preferred Stock" means shares of the Company's
preferred stock, no par value, as may be designated from time to time,
including Series A Preferred Stock.
RELEASE. "Release" means any uncontrolled or unpermitted
release, spill, emission, leaking, pumping, pouring, injection,
escaping, deposit, disposal, discharge, dispersal, leaching or
migration into the indoor or outdoor environment (including, without
limitation, the abandonment or disposal of any barrels, containers or
other closed receptacles containing any Hazardous Materials), or into
or out of any property, including the movement of any Hazardous
Material through the air, soil, surface water, groundwater or property
in violation of any applicable Environmental Law.
SEC DOCUMENTS. "SEC Documents" means the Company's Annual Report
on Form 10-K for the years ended February 28, 1991, February 29, 1992,
and February 28, 1993; its Quarterly Reports on Form 10-Q for each of
the quarters ended May 31, 1993, August 31, 1993, and November 30,
1993; its Form 8-K dated June 24, 1991; its Proxy Statement dated July
2, 1993 relating to the Company's 1993 Annual Meeting of Shareholders;
and all documents attached as Exhibits to or incorporated by reference
into the foregoing.
SERIES A PREFERRED STOCK. "Series A Preferred Stock" means the
Series A Junior Participating Convertible Preferred Stock as
authorized by resolution of the Company's Board of Directors on April
13, 1994 and the Certificate of Designation for which is attached
hereto as Exhibit B.
SHARES. "Shares" means the Company's Common Stock and its Series
A Preferred Stock as may be outstanding from time to time.
SUBSIDIARIES. "Subsidiaries" means Van Waters & Rogers Inc., a
Washington corporation, and Van Waters & Rogers Ltd./Van Waters &
Rogers Ltee, a Canadian corporation.
ARTICLE II
PURCHASE AND SALE OF SHARES
2.1 PURCHASE AND SALE OF ADDITIONAL COMMON SHARES. Subject to
the terms and conditions set forth herein, at the Closing, the Company
shall sell, transfer, convey, assign, and deliver the Additional
Common Shares to Purchaser, and Purchaser shall acquire, purchase, and
accept the Additional Common Shares from the Company.
2.2 PURCHASE PRICE OF ADDITIONAL COMMON SHARES. The price for
the Additional Common Shares shall be $18.74 per share, for a total
purchase price of $37,480,000 for the Additional Common Shares,
subject to Purchaser's right of set-off as provided in Section 8.5 of
this Agreement.
2.3 PAYMENT OF ADDITIONAL COMMON SHARES PURCHASE PRICE. The
total purchase price for the Additional Common Shares shall be
delivered and paid by Purchaser to the Company at the Closing in cash
or by wire transfer to: UNIVAR CORPORATION, Account #1461219, Seattle
First National Bank, ABA # 125000024, Attn. Dora Brown, NW Natl.
Div., 358-3004.
2.4 PURCHASE OF ADDITIONAL PREFERRED SHARES. On and after the
date hereof and through and including the third anniversary of the
date hereof (the "Option Expiration"), the Company shall have the
Option to sell, and the Purchaser shall have the Option to purchase,
up to 101,874 of the Additional Preferred Shares, and, upon exercise
of such Option by the Company or the Purchaser, the Purchaser shall
purchase and the Company shall sell such Additional Preferred Shares,
provided the terms and conditions set forth in this Agreement have
been fulfilled in all material respects.
2.5 PURCHASE PRICE OF ADDITIONAL PREFERRED SHARES. The price
for the Additional Preferred Shares shall be $93.70 per share (the
"Purchase Price").
2.6 EXERCISE OF OPTION. The Company shall provide written
notice to the Purchaser, or the Purchaser shall provide written notice
to the Company, of its election to exercise the Option (the "Option
Notice"). The Option Notice shall specify the number of Additional
Preferred Shares to be purchased and sold, the purchase price
calculated in accordance with Section 2.5, and, if the Option is
exercised by the Company, the proposed use of proceeds of the sale of
the Additional Preferred Shares. The Additional Preferred Shares
shall be sold by the Company and purchased by the Purchaser at one or
two Additional Closings, provided that, at the first Additional
Closing, the Option shall be exercised with respect to all or fifty
percent (50%) of the Additional Preferred Shares, and there shall be
no more than two (2) Additional Closings arising from the exercise of
the Option. Purchaser shall select each Additional Closing Date, but
each Additional Closing Date shall be no later than 90 days after the
date of the applicable Option Notice.
2.7 CONDITIONS TO ADDITIONAL CLOSINGS. In addition to the
conditions in Article VII that are applicable to Additional Closings,
the following shall be conditions precedent to the Purchaser's
obligation to purchase any Additional Preferred Shares following an
exercise of the Option by the Company:
(a) The Company will use the proceeds from the sale of
Additional Preferred Shares for purposes approved by a majority of the
Board of the Company which represent and enhance long term value to
the shareholders of the Company and which the Purchaser reasonably
agrees, which agreement shall not be unreasonably withheld, meet one
or more of the following criteria: the use of proceeds (1) is an
investment within the industry of which the Company and the Purchaser
are a part, (2) promotes the globalization of the Company's business
and/or the development of its distribution business in North America,
(3) enables the Company to appropriately and effectively respond to
environmental concerns and requirements, or (4) enables the Company to
expand, develop, and/or enhance its ChemCarer business; prior to each
Option Notice given by the Company, the Company shall consult with the
Purchaser regarding the proposed use of the proceeds from such Option
and shall give the Purchaser the opportunity to present its views on
the use of proceeds at a meeting of the Company's Board of Directors;
(b) There shall have been no more than one (1) prior
Additional Closing; and
(c) The Closing of the sale of the Additional Common Shares
shall have occurred.
2.8 DEFERRAL FEE. On or before April 30, 1995, April 30, 1996,
and April 30, 1997, provided that an Additional Closing for the
purchase of Additional Preferred Shares has not occurred, Purchaser
shall pay to the Company an annual fee of $350,000 to compensate the
Company at an assumed rate for additional interest expense incurred as
a result of deferring the exercise of the Option as to the Additional
Preferred Shares. In the event of one or more Additional Closing(s)
on or before April 30, 1997, the annual fee shall be proportionately
decreased at a rate of $3.44 per share of Series A Preferred Stock to
take into account the number of shares of Additional Preferred Shares
purchased and prorated based on the number of months during such year
that the Additional Preferred Shares were not outstanding. For
example, if half of the Additional Preferred Shares are purchased
pursuant to the Option in the seventh month of the second year and the
remaining Additional Preferred Shares are purchased at the end of the
second year, then the fee due the Company for the second year would be
$175,000 and there would be no fee for the third year.
2.9 PAYMENT OF ADDITIONAL PREFERRED SHARES PURCHASE PRICE. The
total purchase price for the Additional Preferred Shares shall be
paid at the Additional Closings, subject to Purchaser's right of set-
off as provided in Section 8.5 of this Agreement, in accordance with
wire or other reasonable payment instructions given by the Company
prior to such Additional Closings.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
The Company hereby represents, warrants, and agrees as follows:
3.1 ORGANIZATION AND EXISTENCE. Each of the Company and the
Subsidiaries is a corporation duly organized, validly existing, and in
good standing under the laws of the jurisdiction of its incorporation
with all requisite corporate power to carry on its business as now
conducted and to own and operate the assets and properties now owned
and operated by it. Each of the Company and the Subsidiaries is duly
qualified as a foreign corporation in each jurisdiction in which the
character and location of its assets and the nature of its business
requires such qualification except where the failure to be so
qualified will not have a material adverse effect on the business of
the Company and the Subsidiaries taken as a whole. The Company has
delivered to Purchaser complete and correct copies of the Certificates
of Incorporation and Bylaws of the Company and the Subsidiaries as in
effect on the date hereof. The Subsidiaries are the only operating
subsidiaries of the Company, and neither the Company nor the
Subsidiaries have any other operating subsidiaries.
3.2 AUTHORITY OF THE COMPANY. The Company has full corporate
power and authority to sell the Shares to Purchaser and the sale and
transfer of the Shares by the Company to Purchaser hereunder will vest
title to the Shares in Purchaser free and clear of any lien, pledge,
charge, security interest, adverse claim, or other encumbrance of any
nature whatsoever. The execution, delivery, and performance of this
Agreement by the Company have been duly authorized by all requisite
corporate action and no further action is necessary on the part of the
Company to make this Agreement valid and binding upon the Company in
accordance with its terms. Purchaser has received copies of all
resolutions pertaining to such authorization and all such resolutions
are in full force and effect as of the date hereof.
3.3 CAPITALIZATION. The authorized capital stock of the Company
consists of 40,000,000 shares of Common Stock, of which 19,648,273
shares were issued and outstanding and 2,370,229 shares were held in
the Company's treasury, as of April 1, 1994, and 750,000 shares of no
par Preferred Stock, of which none is outstanding. Series A Preferred
Stock is the only series of preferred stock which has been designated.
As of April 1,1994, 1,045,774 shares were reserved for issuance
pursuant to stock options granted to the Company's employees (the
"Stock Options"). The Company has no other outstanding securities
except for indebtedness reflected in the SEC Documents. All of the
issued and outstanding shares (including the Shares) are or will be at
the time of the Closing or the Additional Closings, as the case may
be, validly issued, fully paid, and non-assessable, and have not and
will not have been issued in violation of (1) the preemptive rights of
any stockholder of the Company or any other party or (2) applicable
federal, state, or foreign securities laws. The Shares are free and
clear of all liens, pledges, charges, security interests, adverse
claims, or other encumbrances of any nature whatsoever. Except for
this Agreement, the Pakhoed Standstill Agreement, the Shareholder
Agreement between the Company and Pakhoed Investeringen B.V.
concerning Univar Europe N.V., and the Stock Options, there are no
outstanding subscriptions, options, rights, warrants, convertible
securities, or other agreements or commitments (contingent or
otherwise) obligating the Company to sell or transfer any of the
Shares or obligating the Company to issue or to transfer from treasury
any additional shares of, or any securities convertible into, the
capital stock of the Company. Except as set forth in the Dow
Standstill Agreement and applicable federal and state securities laws:
(i) there are no restrictions or qualifications of any kind on the
sale or transfer of the Shares and (ii) no proxy, voting trust, or
other instrument, agreement, or document exists which restricts or
could restrict the right, power, or authority of the Purchaser to vote
the Shares as Purchaser deems desirable in its sole discretion.
3.4 NO BREACH. The execution and delivery by the Company of
this Agreement and of any other instrument contemplated hereby to
which the Company will be a party, and the consummation and
performance of the transactions contemplated hereby and thereby, have
not resulted in, will not result in, and do not constitute a conflict
with, a breach or violation of, or a default or an event that, with
notice or lapse of time or both, would be a default, breach, or
violation of, or an event that would permit any party to terminate or
to accelerate the maturity of or any payment pursuant to:
(a) the Certificates of Incorporation or Bylaws of the
Company or any of the Subsidiaries;
(b) any term or provision of any lease, bond, promissory
note, conditional sales contract, commitment, indenture, mortgage,
deed of trust, or other agreement, instrument, indebtedness, or
obligation to which the Company or any of the Subsidiaries, is a party
or by which any of them or any of their respective assets or
properties is bound;
(c) any license, franchise, permit, or other authorization,
governmental or otherwise, held by the Company or any of the
Subsidiaries or otherwise used in connection with the ownership and
present conduct of the business of the Company or any of the
Subsidiaries; or
(d) to the best of the Company's knowledge, any law,
judgment, order, writ, injunction, decree, award, rule, or regulation
of any court, arbitrator, or other agency or body, governmental or
otherwise.
Except compliance with the Securities Exchange Act of 1934, the
execution and delivery of this Agreement and the consummation and
performance of the transactions contemplated hereby do not require the
approval, consent, or authorization of, or any filing with or notice
to, any federal, state, local, or other agency or body, governmental
or otherwise, or any other third party.
3.5 SEC DOCUMENTS. The Company has delivered to Purchaser a
true and complete copy of the SEC Documents. The Company has filed
all documents required to be filed with the SEC since May 1, 1986.
Each of the SEC Documents has been duly filed, and when filed was in
substantial compliance with the requirements of the applicable SEC
form. Each of the SEC Documents was complete and correct in all
material respects as of its date and, as of its date, did not contain
any untrue statement of material fact or omit to state a material fact
required to be stated therein or necessary to make the statements made
therein, in the light of the circumstances in which made, not
misleading. Except to the extent information contained in any SEC
Document has been revised or superseded by a later-filed SEC Document,
none of the SEC Documents currently contains any untrue statement of a
material fact or omits to state a material fact required to be stated
therein or necessary to make the statements therein, in light of the
circumstances under which they were made and taking into account the
date on which the SEC documents were filed, not misleading. Except as
may be disclosed in writing to the Purchaser in connection with the
purchase of the Additional Common Shares or pursuant to the SEC
Documents, since November 30, 1993, there has not been any material
adverse change in the condition (financial or otherwise) or results of
operations of the Company. The audited financial statements of the
Company included in the SEC Documents have been prepared in accordance
with generally accepted accounting principles applied on a consistent
basis during the periods involved (except as may be indicated in the
notes thereto) and fairly present the consolidated financial position
of the Company and its consolidated subsidiaries as at the dates
thereof and the consolidated results of their operations and changes
in financial position for the periods then ended. The unaudited
financial statements included in any SEC Documents comply as to form
in all material respects with applicable accounting requirements and
with the published rules and regulations of the SEC with respect
thereto; and such unaudited financial statements are fairly presented
in conformity with generally accepted accounting principles (except as
otherwise permitted by Form 10-Q of the SEC) applied on a basis
substantially consistent with that of the audited financial statements
included in the SEC Documents subject to normal year-end audit
adjustments.
3.6 ABSENCE OF UNDISCLOSED LIABILITIES. Except as set forth in
the SEC Documents or otherwise disclosed in writing to the Purchaser
in connection with the purchase of the Additional Common Shares, the
Company has not incurred, and none of its assets or properties are
subject to, any liabilities or obligations whether accrued, absolute,
contingent, invoiced or otherwise, whether due or to become due and
whether or not such liabilities are normally shown or reflected on a
balance sheet prepared in a manner consistent with generally accepted
accounting principles, other than:
(a) Estimated federal and state income and other taxes
accrued in the ordinary course of business of the Company since
November 30, 1993; and
(b) Liabilities that, to the best of the Company's
knowledge, individually and in the aggregate do not have a material
adverse effect on the financial condition or business of the Company
and the Subsidiaries taken as a whole.
The Company is not in default in respect of any term or condition of
any material indebtedness or liability. There are no facts in
existence on the date hereof known to the Company that might
reasonably serve as the basis for any material liabilities or
obligations of the Company not disclosed in this Agreement, the SEC
Documents, or the Schedules or Exhibits attached to this Agreement.
3.7 TAX MATTERS. All material federal, state, county, local,
foreign and other taxes, including without limitation, income taxes,
corporate franchise taxes, sales and ad valorem taxes, assessments,
penalties, and interest due and payable by the Company on or before
the date of this Agreement have been paid, are adequately provided for
in the Company's financial statements, or are being contested in good
faith, and the Company has filed (or obtained extensions for) all tax
returns and reports required to be filed by it with all applicable
taxing authorities, within the time and in the manner prescribed by
law. Except as otherwise disclosed in writing to the Purchaser in
connection with the purchase of the Additional Common Shares or in the
SEC Documents, there are no unpaid taxes which are or could become
liens upon any of the property or assets of the Company other than
property taxes not yet due and payable. Appropriate accruals have
been made for all taxes attributable to all periods prior to and
including the Closing, but not yet due. There are no applicable
taxes, fees, or other governmental charges payable in connection with
the execution and delivery of this Agreement.
3.8 CERTAIN REAL PROPERTY MATTERS.
(a) REAL PROPERTY. The Company has previously provided the
Purchaser with a complete and accurate list (as of the date of such
list) (the "Facilities List") of real properties owned by the Company
or any of the Subsidiaries or covered by leases
for more than 3,000 square feet to which the Company or any of the
Subsidiaries is a party (the "Property").
(b) GOVERNMENTAL RESTRICTIONS. The Company has not
received, nor is it aware of, any notifications, restrictions, or
stipulations from the United States of America, any state or any other
governmental authority requiring any work to be done on the Property
or threatening the use of the Property, except environmental matters
disclosed in writing to the Purchaser in connection with the purchase
of the Additional Common Shares or which in the aggregate would not
have a material adverse effect on the Company and the Subsidiaries
taken as a whole. There are no pending or threatened condemnation
proceedings affecting any portion of the Property which is material to
the operations of the Company and the Subsidiaries taken as a whole.
(c) TITLE. Fee simple title to the Property listed on the
Facilities List as owned is currently vested in the Company or the
applicable Subsidiary, as the case may be, subject to no known
mortgages, liens, encumbrances, or other matters affecting title,
except as disclosed in the SEC Documents or on the Facilities List or
as arise in the ordinary course of business (including liens arising
as a matter of law) and do not materially impair the Company's or the
applicable Subsidiary's ownership or use of such Property taken as a
whole.
(d) LEASES AND RENTS. All of the leases listed on the
Facilities List are valid and in full force, and there does not exist
any material default or event which, with notice or lapse of time or
both, would constitute a default under any of these leases and which
would have a materially adverse effect on the Company or the
applicable Subsidiary.
(e) ZONING. To the best of the Company's knowledge, the
Company or the applicable Subsidiary has the right to use each
Property in the use to which it is now put, and neither the Company
nor the applicable Subsidiary has received notice of any zoning
violation or change with regard to any such Property that would
prevent continuation of such use.
(f) ENVIRONMENTAL PROTECTION. To the best of the Company's
knowledge and except as disclosed in writing to the Purchaser in
connection with the purchase of the Additional Common Shares:
(i) the operations of the Company and its
Subsidiaries, comply in all material respects with all Environmental
Laws, noncompliance with which would have a material adverse effect on
the operations, assets, or condition of the Company and its
Subsidiaries taken as a whole;
(ii) the Company and each of its Subsidiaries have
obtained all material permits under Environmental Laws necessary to
their respective operations, and all such permits are in good
standing, and the Company and each of its Subsidiaries are in
compliance with all material terms and conditions of such permits, the
absence of, or noncompliance with, which would have a material adverse
effect on the operations, assets, or condition of the Company and its
Subsidiaries taken as a whole; and
(iii) neither the Company nor any of its Subsidiaries
has any liability in connection with any Release of any Hazardous
Materials by the Company or any of its Subsidiaries or the existence
of any Hazardous Material on under or about any property that would
give rise to an Environmental Claim that would have a material adverse
effect on the operations, assets, or condition of the Company and its
Subsidiaries taken as a whole.
3.9 MATERIAL CONTRACTS. The Company has provided a list of all
contracts and agreements, written or oral, absolute or contingent,
which involve an annual commitment of $1 million or more and to which
the Company or any Subsidiary is a party, other than (a) those
involving the purchase or sale of inventory in the ordinary course of
the Company's business, and (b) those specifically listed in any other
disclosure made pursuant to this Agreement or in the SEC Documents.
The Company has provided Purchaser access to each such contract and
agreement together with all amendments and modifications thereof. The
Company shall provide a copy of such contracts and agreements upon
Purchaser's request.
3.10 NO DEFAULT. There has been no default or event that with
notice or lapse of time, or both would constitute a default, in any
material respect, of any obligation to be performed by the Company,
any Subsidiary, or any other party under any contract or agreement
described in Section 3.9 or in the SEC Documents, nor has the Company
waived any material right under any such contract or agreement. The
Company has never had a material uncured default on the payment of any
principal, premium, or interest on any indebtedness. Neither the
Company nor any Subsidiary has received notice that any party intends
to modify, cancel, or terminate any such contract or agreement.
3.11 PATENTS AND TRADEMARKS. The Company has provided the
Purchaser with a complete written list of all trademarks, trademark
registrations or applications, service marks, patents, trade names,
copyrights, or copyright registrations or applications owned or used
by the Company and each Subsidiary, together with a brief description
of each. Except as disclosed to Purchaser in writing in connection
with the purchase of the Additional Common Shares, the Company and
each Subsidiary owns or possesses all trademarks, trademark
registrations or applications, service marks, patents, trade names,
copyrights, or copyright registrations or applications, the use of
which is necessary in connection with the proper and efficient
operation of the business of the Company and each Subsidiary as now
conducted or as proposed to be conducted, or in connection with the
performance of any contract to which the Company or any Subsidiary is
a party, without any known conflict with the rights of others.
Neither Company nor any Subsidiary has, to the best of its knowledge,
infringed nor is now infringing upon any trademark, trade name,
service mark, or copyright belonging to any other Person whatsoever.
3.12 LICENSES AND PERMITS. Except as to matters covered by
Section 3.8, the Company has all known licenses, franchises, permits,
easements, certificates, consents, rights, and privileges that it
reasonably believes are necessary or appropriate to the proper and
efficient conduct of the business of the Company and each Subsidiary
as now conducted or as proposed to be conducted, without any known
conflict with the rights of others. All such items are in full force
and effect and the Company and each Subsidiary are not in default
under any such items where such default would have a material adverse
effect on the Company and its Subsidiaries taken as a whole.
3.13 INSURANCE. The Company has previously provided a written
description (including coverage amounts) of primary and first level
excess insurance policies (i) currently carried by the Company in
connection with the ordinary conduct of the Company's business and in
connection with assets and properties owned or leased by the Company
(except employee benefit coverages) or (ii) issued since 1950 under
which the Company or any of its subsidiaries engaged in the present or
past chemical business may
be entitled to recovery for losses sustained as a result of any claim
or proceeding involving Hazardous Materials.
3.14 LITIGATION, LABOR DISPUTES, PRODUCT WARRANTIES AND PRODUCT
LIABILITY.
(a) LITIGATION. Except as set forth in the SEC Documents,
or as otherwise disclosed in writing to Purchaser in connection with
the purchase of the Additional Common Shares, no known claim, action,
suit, investigation or other proceeding, reasonably believed to
involve $1,000,000 or more, against the Company or any Subsidiary or
against any asset of the Company or any Subsidiary is pending or, to
the Company's knowledge, threatened. As of February 28, 1994,
reserves for claims reported were $3,400,000 and reserves for incurred
but not reported claims were $2,700,000. It is the Company's present
best judgment that no such claim, action, suit, investigation or other
proceeding would (a) result in any judgment, order, decree or other
determination that would have a material adverse effect on the
Company; or (b) prevent or impede the performance of this Agreement or
of any of the agreements related to this Agreement.
(b) LABOR. There is not pending, nor, to the Company's
knowledge, threatened, any labor or collective bargaining dispute,
petition, strike or work stoppage, organizing campaign, picketing
(whether organized or not) or advocated boycotting, or slowdown that
would affect a material portion of the business of the Company. There
is not pending, nor to the Company's knowledge is there threatened,
any charge or complaint against the Company by the National Labor
Relations Board (or any equivalent agency outside the United States)
or any representative thereof; nor to the Company's knowledge is there
any valid basis for finding that the Company has committed any unfair
labor practice as defined in the National Labor Relations Act of 1947,
as amended, or any similar law of any jurisdiction outside the United
States. The Company has provided Purchaser with true and complete
summary of all union contracts, collective bargaining agreements,
consent decrees or affirmative action plans.
(c) PRODUCT WARRANTIES AND PRODUCTS LIABILITIES. Except as
disclosed to the Purchaser in writing, there is not pending, nor to
the Company's knowledge threatened, any claim, action, suit or other
proceeding against the Company with respect to products sold by the
Company which would have a material adverse effect on the Company and
Subsidiaries taken as a whole.
3.15 COMPLIANCE WITH LAWS. Except with respect to environmental
matters, which are addressed in Section 3.8, the Company and the
Subsidiaries have, to the best of their knowledge, complied, and are
in compliance, in all material respects, with all laws, ordinances,
rules, regulations, requirements, and orders of federal, state, or
local governments and/or their agencies to which they are subject,
(including, without limitation, those relating to zoning, building,
immigration, and equal employment opportunities), the violation of
which does or could materially adversely affect the prospects,
earnings, properties, or condition, financial or otherwise, of the
Company and the Subsidiaries. The Company and the Subsidiaries have
obtained all material licenses, consents, permits, and other
governmental authorizations presently required for the conduct of
their businesses and operations as currently conducted and for the
ownership and operation of the assets and properties now owned and
operated by them. All such licenses, consents, permits and
authorizations are in full force and effect, and the Company and the
Subsidiaries are in compliance therewith.
3.16 EMPLOYEE BENEFIT PLANS. Except for the employee benefit
plans described in the last sentence of this Section 3.16 or as
disclosed in writing to the Purchaser in connection with the purchase
of the Additional Common Shares, there are no pension, bonus, profit
sharing, stock option, stock incentive, savings, or other employee
benefit plans of any kind maintained by the Company or to which the
Company contributes or is required to contribute. Except as so
disclosed, all such plans and their related trusts, if any, comply
with the provisions of and have been administered in compliance with
the provisions of the Employee Retirement Income Security Act of 1974,
as amended ("ERISA"), and all other applicable laws, rules, and
regulations, and any necessary governmental approval of the plans has
been obtained. True and complete copies of (or descriptions of) the
employee benefit plans have been furnished to Purchaser.
3.17 BOOKS AND RECORDS. The books and records of account of the
Company and each Subsidiary are complete and correct and have been
maintained in accordance with generally accepted accounting
principles; the minute books and other records of the Company and each
Subsidiary fairly reflect actions taken at the meetings of the Company
and each Subsidiary and their respective Boards of Directors and
shareholders.
3.18 FULL DISCLOSURE. No representation, warranty, or other
statement contained in this Agreement or in any other document,
certificate, or written statement or disclosure furnished to Purchaser
in connection with the transactions contemplated by this Agreement
contains any untrue statement of a material fact or omits to state a
material fact necessary in order to make the statements contained
herein or therein not misleading. There is no fact (specifically
relating to the Company or any Subsidiary as distinguished from
general industry and general economic facts) known to the Company or
any Subsidiary that materially adversely affects the prospects,
earnings, properties, or condition, financial or otherwise, of the
Company or any Subsidiary that has not been disclosed herein or in
such other documents, certificates, and statements furnished to
Purchaser for use in connection with the transactions contemplated
hereby.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF PURCHASER
Purchaser represents, warrants, and agrees as follows:
4.1 ORGANIZATION AND EXISTENCE. Purchaser is a corporation duly
organized, validly existing, and in good standing under the laws of
the state of Delaware, and has all requisite corporate power to enter
into and perform this Agreement and the transactions contemplated
hereby in the manner provided herein.
4.2 AUTHORITY OF PURCHASER. As of the Closing, the execution,
delivery, and performance by Purchaser of this Agreement shall have
been duly authorized by the Board of Directors of Purchaser, and no
further corporate action shall be necessary on the part of Purchaser
to make this Agreement the legal, valid, and binding obligation of
Purchaser enforceable against it in accordance with its terms.
4.3 PURCHASE FOR INVESTMENT. Purchaser is acquiring the Shares
for its own account for investment purposes and not with a view toward
resale or redistribution. Purchaser may only dispose of the Shares in
accordance with the Dow Standstill Agreement and will not offer to
sell or otherwise dispose of any Shares in violation of applicable
federal and state securities laws. Purchaser has had sufficient
opportunities to discuss and review the Company's business,
management and financial affairs.
ARTICLE V
CONDITIONS PRECEDENT TO PURCHASER'S PERFORMANCE
5.1 CONDITIONS. The obligations of Purchaser to purchase the
Additional Common Shares and any Additional Preferred Shares under
this Agreement are subject to the satisfaction, at or before the
Closing Date, with respect to the Additional Common Shares, and the
Additional Closings, with respect to the Additional Preferred Shares,
of all the conditions set out below in this Article 5. Purchaser may
waive any or all of these conditions in whole or in part without prior
notice; provided, however, that no such waiver of a condition shall
constitute a waiver by Purchaser of any of its other rights or
remedies, at law or in equity, if the Company shall be in material
default of any of its representations, warranties, or covenants under
this Agreement and such default is not actually known to Purchaser on
the Closing Date or the Additional Closing Date, as the case may be.
5.2 ACCURACY OF REPRESENTATIONS. Except as otherwise permitted
by this Agreement, all representations and warranties by the Company
in this Agreement, the Schedules hereto, or in any written statement
delivered to or to be delivered to Purchaser under this Agreement
shall be true on and as of the Closing Date as made at that time.
Prior to each Additional Closing Date, the Company shall update in
writing the representations and warranties including any changes to
the exceptions previously disclosed. The representations and
warranties set forth in Sections 3.1, 3.2, 3.4, 3.6, 3.7, 3.8, 3.9,
3.10, 3.11, 3.12, 3.13, 3.14, 3.15, 3.16, and 3.18 shall each be
substantially the same provided that disclosed exceptions may differ
so long as the representations and warranties, as modified, do not
reflect a material adverse change to the Company and its Subsidiaries
taken as a whole.
5.3 PERFORMANCE OF THE COMPANY. The Company shall have
performed, satisfied, and complied in all material respects with all
covenants, agreements, and conditions required by this Agreement to be
performed or complied with by it on or before the Closing Date and the
Additional Closing Dates, as the case may be.
5.4 ABSENCE OF LITIGATION. No action, suit, or proceeding
before any court or any governmental body or authority, pertaining to
the transactions contemplated by this Agreement or to their
consummation, shall have been instituted or threatened on or before
the Closing Date and the Additional Closing Dates, as the case may be.
5.5 CONSENTS. The Board of Directors of the Purchaser (or
Executive Committee thereof) shall have approved the transactions
contemplated by this Agreement. All necessary agreements and consents
of any parties to the consummation of the transactions contemplated by
this Agreement, or otherwise pertaining to the matters covered by it,
shall have been obtained by the Company and delivered to Purchaser.
5.6 APPROVAL OF DOCUMENTS. The form and substance of all
certificates, instruments, opinions, and other documents delivered to
Purchaser under this Agreement shall be satisfactory in all reasonable
respects to Purchaser and its counsel.
ARTICLE VI
CONDITIONS PRECEDENT TO THE COMPANY'S PERFORMANCE
6.1 CONDITIONS. The obligations of the Company to sell and
transfer the Shares under this Agreement are subject to the
satisfaction, at or before the Closing Date and the Additional Closing
Dates, as the case may be, of all the following conditions of this
Article 6. The Company may waive any or all of these conditions in
whole or in part without prior notice; provided, however, that no such
waiver of a condition shall constitute a waiver by the Company of any
of their other rights or remedies, at law or in equity, if Purchaser
shall be in material default in any of its representations,
warranties, or covenants under this Agreement and such default Is not
actually known to the Company on the Closing Date or the Additional
Closing Dates, as the case may be.
6.2 PURCHASER'S WARRANTIES. All representations and warranties
by Purchaser contained in this Agreement or in any written statement
delivered by Purchaser under this Agreement shall be true on and as of
the Closing Date and the Additional Closing Dates, as the case may be,
as though made as of that date.
6.3 PERFORMANCE OF PURCHASER. Purchaser shall have performed,
satisfied, and complied with all covenants, agreements, and conditions
required by this Agreement to be performed, satisfied or complied with
by it on or before the Closing Date and the Additional Closing Dates,
as the case may be.
6.4 ABSENCE OF LITIGATION. No action, suit or proceeding before
any court or any governmental body or authority, pertaining to the
transactions contemplated by this Agreement or to their consummation,
shall have been instituted threatened on or before the Closing Date
and the Additional Closing Dates, as the case may be.
6.5 APPROVAL OF DOCUMENTS. The form and substance of all
certificates, instruments, opinions, and other documents delivered to
the Company under this Agreement shall be satisfactory in all
reasonable respects to the Company and its counsel.
ARTICLE VII
THE CLOSING
7.1 CLOSING. The Closing with respect to the transactions
contemplated by this Agreement with respect to the sale of the
Additional Common Shares shall be held on May 13, 1994, 9:00 a.m.
local time at Midland, Michigan or at such other time, place, and date
as may be mutually agreed to by the parties (the "Closing Date").
7.2 THE COMPANY'S OBLIGATIONS. At the Closing, the Company
shall deliver to Purchaser the following:
(a) A certificate representing the Additional Common Shares
in the name of the Purchaser;
(b) An executed counterpart of the Dow Standstill
Agreement; and
(c) The updates to all Schedules or other written
disclosures.
7.3 PURCHASER'S OBLIGATIONS. At the Closing, Purchaser shall
deliver to the Company the following:
(a) $37,480,000 in cash or by wire transfer, as provided in
Section 2.3 hereof; and
(b) An executed counterpart of the Dow Standstill
Agreement.
ARTICLE VII
POST CLOSING
8.1 NATURE OF STATEMENTS. All statements contained herein, in
any Schedule or Exhibit hereto, or in any certificate or other written
instrument delivered by or on behalf of the Company or Purchaser
pursuant to this Agreement, or in connection with the transactions
contemplated hereby, shall be deemed representations and warranties by
the Company or Purchaser, as the case may be.
8.2 SURVIVAL OF REPRESENTATIONS AND WARRANTIES. Regardless of
any investigation at any time made by or on behalf of any party
hereto, or of any information any party may have in respect thereof,
all covenants, agreements, representations, and warranties made
hereunder or pursuant hereto or in connection with the transactions
contemplated hereby shall survive the Closing and each Additional
Closing until the later of February 28, 1997 or one year after the
applicable Additional Closing Date.
8.3 EXPENSES. The Company and Purchaser each (i) represent and
warrant that they have not taken and will not take any action that
would cause the other party to have any obligation or liability to any
person for a finder's or broker's fee, and (ii) agree to indemnify the
other party for breach of the foregoing representation and warranty,
whether or not the Closing occurs. Each of the parties hereto shall
pay all costs and expenses incurred by it or on its behalf in
connection with this Agreement and the transactions contemplated
hereby, including, without limiting the generality of the foregoing,
fees and expenses of its own financial consultants, accountants, and
counsel.
8.4 INDEMNIFICATION BY THE COMPANY. The Company agrees to
indemnify, defend, and hold harmless Purchaser and its permitted
successors and assigns from and against any assessment, claim, demand,
obligation, liability, loss, cost, damage, or expense, including,
without limitation, interest, penalties, and reasonable attorneys'
fees resulting from, arising out of, or relating to, any:
(a) Breach or default in the performance by the Company of
any covenant or agreement of the Company contained in this Agreement;
(b) Breach of warranty or inaccurate or erroneous
representation made by the Company herein or in any Schedule or
Exhibit hereto or in any certificate or other instrument delivered by
or on behalf of the Company pursuant hereto; or
(c) Liability arising out of any and all actions, suits,
proceedings, claims, demands, judgments, costs, and expenses incident
to any of the foregoing.
Purchaser and its successors and permitted assigns shall promptly
notify the Company of any such liability, breach of warranty,
inaccuracy, misrepresentation, or any other claim arising under the
foregoing indemnification provision. The Company may contest and
defend in good faith any claim of third parties covered by this
Section 8.4, provided such contest is made without cost or prejudice
to Purchaser, and provided the Company notifies Purchaser within
thirty (30) days of its receipt of notice thereof of the Company's
desire to contest the claim, but no later than 2 business days prior
to the deadline for responsive pleadings. If the Company does not
notify Purchaser of its desire to contest the claim, the Company shall
reimburse Purchaser on demand for any payment actually made by
Purchaser at any time after the Closing Date with respect to any
liabilities, obligations, expenditures, or claims to which the
foregoing indemnity relates.
8.5 PURCHASER'S SET-OFF. In the event Purchaser incurs any
liabilities, losses, damages, costs, or expenses resulting from, or
related to any breach of, or failure by the Company to perform, any of
their representations, warranties, covenants, or agreements in this
Agreement, or in any Schedule, Exhibit, certificate, or other
instrument furnished or to be furnished by the Company thereunder,
and/or in the event the Company becomes obligated to indemnify
Purchaser pursuant to the terms hereof, Purchaser may, at its option
and without prejudice to any right of Purchaser to proceed directly
against the Company, be entitled to set-off all or any portion of the
amount of any such liability, loss, damage, or expense or indemnity to
which Purchaser shall be entitled hereunder against the unpaid amounts
due under this Agreement. The exercise of such right of set-off by
Purchaser hereunder shall be evidenced by means of a notice to such
effect given by Purchaser to the Company. Upon the exercise by
Purchaser of its right to set-off hereunder, the amount to which
Purchaser is entitled to set-off shall be, and is deemed to be,
applied in reduction of, and shall constitute a payment of, the
amounts due under this Agreement to the extent specified in the notice
of set-off.
8.6 INDEMNIFICATION BY PURCHASER. Purchaser shall indemnify,
defend, and hold harmless the Company and its permitted successors and
assigns from and against any assessment, claim, demand, obligation,
liability, loss, cost, damage, or expense, including, without
limitation, interest, penalties, and reasonable attorneys' fees
resulting from, arising out of, or relating to, any:
(a) Breach or default in the performance by Purchaser of
any covenant or agreement of Purchaser contained in this Agreement;
(b) Breach of warranty or inaccurate or erroneous
representation made by Purchaser herein or in any Schedule or Exhibit
hereto or in any certificate or other instrument delivered by or on
behalf of Purchaser pursuant hereto; or
(c) Liability arising out of any and all actions, suits,
proceedings, claims, demands, judgments, costs, and expenses incident
to any of the foregoing.
The Company and its successors and assigns shall promptly notify
Purchaser of any such liability, breach of warranty, inaccuracy,
misrepresentation, or any other claim arising under the foregoing
indemnification provision. Purchaser may contest and defend in good
faith any claim of third parties covered by this Section 8.6, provided
such contest is made without cost or prejudice to the Company, and
provided Purchaser notifies the Company within thirty (30) days of
Purchaser's receipt of notice thereof that Purchaser intends to
contest the claim, but no later than 2 business days prior to
the deadline for responsive pleadings. If Purchaser does not notify
the Company of its intention to contest the claim, Purchaser shall
reimburse the Company on demand for any payment actually made by the
Company at any time after the Closing Date with respect to any
liabilities, obligations, expenditures, or claims to which the
foregoing indemnity relates.
8.7 NOTICES. All notices, requests, consents, and other
communications hereunder shall be in writing and shall be deemed to
have been delivered on the date first (a) personally delivered (b)
received by facsimile or (c) recorded as delivered by overnight
courier, if addressed as follows:
(a) if to the Company, to: Univar Corporation
6100 Carillon Point
Kirkland, WA 98033
Attn: General Counsel
Facsimile: (206) 889-4136
With a copy to: Preston Gates & Ellis
5000 Columbia Center
701 Fifth Avenue
Seattle, WA 98104-7078
Attn: Richard B. Dodd
Facsimile: (206) 623-7022
(b) if to Purchaser, to: The Dow Chemical Company
2030 Willard H. Dow Center
Midland, MI 48674
Attn: Director
of Mergers and Acquisitions
Facsimile: (517) 636-1830
With a copy to: The Dow Chemical Company
2030 Willard H. Dow Center
Midland, MI 48674
Attn: General Counsel
Facsimile: (517) 636-0861
Any party may change its address for purposes of this Section 8.7 by
giving the other parties written notice of the new address in the
manner set forth above.
8.8 ARBITRATION. Any controversy or claim arising out of, or
related to, this Agreement, or the making, performance, or
interpretation thereof, shall be settled by arbitration in Chicago,
Illinois in accordance with the rules of the American Arbitration
Association then existing, or the rules of any other comparable
organization in the event the American Arbitration Association shall
not then be in existence, and judgment on the arbitration award may be
entered in any court having jurisdiction over the subject matter of
the controversy.
8.9 SPECIFIC PERFORMANCE. Each party's obligations under this
Agreement are unique. If any party should default in its obligations
under this Agreement, the parties each acknowledge that it would be
extremely impracticable to measure the resulting damages; accordingly,
the non-defaulting party, in addition to any other available rights or
remedies, may sue in equity for specific performance, and the
parties each expressly waive the defense that a remedy in damages
will be adequate. Notwithstanding any breach or default by any of the
parties of any of their respective representations, warranties,
covenants, or agreements under this Agreement, if the purchase and
sale contemplated by it shall be consummated at the Closing, each of
the parties waives any rights that it or he may have to rescind this
Agreement or the transaction consummated by it; provided, however,
this waiver shall not affect any other rights or remedies available to
the parties under this Agreement or under the law except for defaults
or breaches actually known to such parties on the Closing Date or
Additional Closing Date, as the case may be.
8.10 COSTS. If any legal action or an arbitration 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 relief to which it or they may be
entitled.
8.11 Assignment. This Agreement may not be assigned by any
party hereto without the prior written consent of the other parties
hereto. Subject to the foregoing, this Agreement is binding upon the
successors and assigns of the parties hereto.
ARTICLE IX
MISCELLANEOUS
9.1 CONFIDENTIALITY. The parties agree that, except as may be
required by law, no public release or other disclosure of information
concerning this Agreement, the proposed transaction, the Company or
the business affairs of the Company shall be made subsequent to the
date hereof, including subsequent to the Closing, unless and until
mutual agreement is reached in writing on any such publicity or other
disclosure.
9.2 SECTION AND PARAGRAPH HEADINGS. The Article and Section
headings in this Agreement are for reference purposes only and shall
not affect in any way the meaning or interpretation of this Agreement.
9.3 CHANGES, WAIVERS, ETC. Neither this Agreement nor any
provision hereof may be changed, waived, discharged, or terminated
orally, but only by a statement in writing signed by the party against
which enforcement of the change, waiver, discharge, or termination is
sought.
9.4 ENTIRE AGREEMENT. This Agreement and the Exhibits,
Schedules, certificates, and documents referred to herein constitute
the entire agreement of the parties hereto, and supersede all prior
understandings with respect to the subject matter hereof. All
Exhibits and Schedules attached to this Agreement are deemed to be
fully incorporated herein by this reference for all purposes, as
though fully set forth at length herein.
9.5 COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all of
which shall constitute the same instrument.
9.6 SEVERABILITY. In the event that a court of competent
jurisdiction determines that any portion of this Agreement is in
violation of any statute or public policy,
then only the portions of this Agreement that violate such statute
or public policy shall be stricken. All portions of this Agreement
that do not violate any statute or public policy shall continue in
full force and effect. Any court order striking any portion of this
Agreement shall modify the stricken terms as narrowly as possible to
give as much effect as possible to the intentions of the parties
pursuant to this Agreement.
9.7 GOVERNING LAW. This Agreement shall be construed in
accordance with, and governed by, the laws of the State of Washington.
IN WITNESS WHEREOF, this Agreement has been duly executed by the
parties hereto as of the date first above written.
UNIVAR CORPORATION
By: /S/ JAMES W. BERNARD
Its: President And Chief Executive
Officer
THE DOW CHEMICAL COMPANY
By: /S/ ENRIQUE SOSA
Its: Senior Vice President
EXHIBIT 4(i)
Amended and Restated Standstill Agreement between Univar
Corporation and
The Dow Chemical Company dated May 13, 1994
AMENDED AND RESTATED
STANDSTILL AGREEMENT
THIS AMENDED AND RESTATED STANDSTILL AGREEMENT (the "Agreement")
is made this 13th day of May, 1994, by and between UNIVAR CORPORATION,
a Delaware corporation ("Company"), and THE DOW CHEMICAL COMPANY, a
Delaware corporation ("Dow").
RECITALS
A. Company and Dow initially entered into this Agreement as of
June 24, 1991 along with a Stock Purchase Agreement (as defined
below). Pursuant to the Stock Purchase Agreement, Dow shall acquire
from Company 2,000,000 shares of Common Stock and may, upon
circumstances described in the Stock Purchase Agreement, acquire up to
101,874 shares of Series A Preferred Stock of Company, in accordance
with the terms of the Stock Purchase Agreement.
B. The parties seek to regulate the acquisition and disposition
by Dow of Company's Voting Securities, provide for Dow representation
on Company's Board, and generally foster a constructive and mutually
beneficial relationship.
C. Dow and Company acknowledge that Company has made, prior to
the initial date hereof, a careful evaluation of Dow's investment
objectives with regard to its ownership of Voting Securities, and the
compatibility of Dow's management and objectives with the management
and objectives of Company; that such factors were critical to Company
in its decision to enter into this Agreement; that, absent the
provisions of Articles II through IV hereof, Dow's ownership of Voting
Securities would present an unusual opportunity for it to gain an
unusual degree of influence over Company and Company might have
reached a different decision with regard to entering into this
Agreement and the Stock Purchase Agreement; that, therefore, the
provisions of Articles II through IV were and continue to be a
material inducement to Company to enter into and amend this Agreement
and the Stock Purchase Agreement; and, that the primary purposes of
Articles II through IV are that, so long as such provisions remain in
effect and except as permitted by such provisions, the Voting
Securities owned by Dow not come to rest in the hands of any single
holder or group of holders other than Dow, and Dow's ownership of
Voting Securities not be increased, other than as provided for in this
Agreement, the Stock Purchase Agreement, or with the consent of
Company. Dow acknowledges that such purposes are reasonable and that
the provisions of Articles II through IV are reasonable in view of
such purposes.
D. The parties desire to amend and restate this agreement
contemporaneously with the amendment and restatement of the Stock
Purchase Agreement. Provisions of the existing agreement with no
current or future effect have been deleted.
NOW, THEREFORE, in consideration of the agreements and covenants
set forth herein and in the Stock Purchase Agreement, and for other
good and valuable consideration, the parties agree as follows:
ARTICLE I
DEFINITIONS
As used in this Agreement, in addition to other terms defined
elsewhere herein, the following terms have the respective meanings set
forth below:
1.1 ACT. "Act" means the Securities Act of 1933, as amended.
1.2 AFFILIATE. "Affiliate" means any Person directly or
indirectly controlled by, controlling or under common control with
another Person, including but not limited to a Person who is employed
by or is a consultant or independent contractor to another Person.
For purposes of this definition, "control" means the power to direct
the management or policies of the Person in question.
1.3 BENEFICIAL OWNER. "Beneficial Owner" and "Beneficial
Ownership" and other derivations thereof shall have the same meaning
as under Rule 13d-3 (as now in effect) adopted pursuant to Section
13(d) of the Exchange Act.
1.4 BOARD. "Board" means the Board of Directors of Company as
constituted from time to time.
1.5 BUSINESS DAY. "Business Day" means any Monday through
Friday, inclusive, excluding any such day which is a Federal or State
of Washington holiday.
1.6 COMMISSION. "Commission" means the Securities and Exchange
Commission of the United States.
1.7 COMMON STOCK. "Common Stock" means the common stock of
Company, par value $.33-1/3 per share or such other par value as may
be established from time to time.
1.8 COMMON STOCK EQUIVALENTS. "Common Stock Equivalents" means
the sum of the following, determined at any time during the term of
this Agreement: (a) the total number of shares of issued and
outstanding Common Stock, plus (b) the number of shares of Common
Stock reserved for issuance pursuant to stock options granted (but not
yet exercised) under Company's stock option plans, and plus (c) the
number of votes which may be cast for the election of directors
(whether directly or by formula) as a result of ownership of any
Voting Securities other than Common Stock; provided, however, the
shares of Common Stock described in (b) above shall not be included in
Common Stock Equivalents until the earlier of (I) the date the options
are exercisable, or (ii) the end of the fiscal year of Company during
which such options were granted; provided, further, that the votes
described in (c) above shall not be included in Common Stock
Equivalents until the Voting Securities other than Common Stock are
able to be voted for the election of directors.
1.9 CORE SHAREHOLDERS. "Core Shareholders" means the
individuals identified on the attached Exhibit A.
1.10 DOW AFFILIATE. "Dow Affiliate" means any Affiliate of Dow.
1.11 DOW AFFILIATED DIRECTOR. "Dow Affiliated Director" means
any member of the Board who has been designated by Dow under Article
VI for nomination or appointment as a director of Company.
1.12 EFFECTIVE DATE. "Effective Date" means the 13th day of
May, 1994.
1.13 EXCHANGE ACT. "Exchange Act" means the Securities Exchange
Act of 1934, as amended.
1.14 HOLDER. "Holder" means Dow and any Person to whom the
registration rights under Article VII have been transferred in
compliance with Section 7.7.
1.15 INVESTMENT BANKING FIRM. "Investment Banking Firm" means a
nationally recognized investment banking firm.
1.16 MARKET DISPOSITION PROGRAM. See Section 3.9(a).
1.17 MARKETABLE SECURITIES. See Section 3.13(a).
1.18 NOTICE OF EXERCISE. See Section 3.9.(b)(iii).
1.19 NOTICE OF ISSUE. See Section 2.6.
1.20 NOTICE OF PROPOSED SALE. See Section 3.9(a).
1.21 NOTICE OF PROPOSED COMPANY PURCHASE. See Section 3.12.
1.22 PAKHOED. Pakhoed means, collectively, Pakhoed
Investeringen B.V., a Netherlands corporation ("Parent"), Pakhoed
Holding, N.V., a Netherlands corporation ("Holding"), Pakhoed USA,
Inc., a Delaware corporation, and any Affiliates of said corporations.
1.23 PAKHOED AFFILIATED DIRECTOR. "Pakhoed Affiliated Director"
means any member of the Board who has been designated by Pakhoed under
the Pakhoed Standstill Agreement.
1.24 PAKHOED STANDSTILL AGREEMENT. The "Pakhoed Standstill
Agreement" means that certain Standstill Agreement among the Company,
and Pakhoed dated as of September 19, 1986, including any and all
amendments thereto.
1.25 PERCENTAGE LIMITATION. See Section 2.2.
1.26 PERMITTED PERCENTAGE. "Permitted Percentage" means the
Percentage Limitation or, if the percentage of Common Stock
Equivalents owned by Dow increases as a consequence of (a) a reduction
in the number of outstanding Voting Securities other than as a result
of (1) the expiration of rights to acquire Common Stock under
Company's stock option plans or (2) the lapse of rights to vote for
the election of directors as a result of ownership of any Voting
Securities other than Common Stock, (b) Dow's acquisitions of Voting
Securities with Board approval in accordance with Section 2.8, or in
accordance with the Stock Purchase Agreement, or (c) Dow's
acquisitions of Voting Securities in a tender offer permitted by
Section 2.7, following which Company fails to repurchase shares of
Voting Securities in accordance with Section 2.7(b), such greater
percentage of Common Stock Equivalents owned by Dow after such
reduction, acquisition, or failure, respectively. The Permitted
Percentage shall
be reduced from time to time if, upon the issuance by Company of
Common Stock Equivalents, Dow either does not or is not permitted by
this Agreement to purchase its full Permitted Percentage of such
issuance.
1.27 PERSON. "Person" means any individual, partnership,
association, corporation, trust, or other entity, including without
limitation employee pension, profit sharing, and other benefit plans
and trusts.
1.28 PRINCIPAL TRADING MARKET. "Principal Trading Market" means
the principal trading exchange or national automated stock quotation
system on which the Common Stock is traded or quoted.
1.29 PRIVATE SALE. See Section 3.9(a).
1.30 SERIES A PREFERRED STOCK. "Series A Preferred Stock" means
the Series A Junior Participating Convertible Preferred Stock of the
Company, as created by a Certificate of Designation adopted by
resolution of the Board on April 13, 1994.
1.31 STOCK PURCHASE AGREEMENT. "Stock Purchase Agreement" means
the Agreement of Purchase and Sale of Stock originally dated June 24,
1991 between Dow and Company, including any and all amendments
thereto.
1.32 13D GROUP. "13D Group" means any group of Persons (other
than the Core Shareholders) formed for the purpose of acquiring,
holding, voting, or disposing of Voting Securities required under
Section 13(d) of the Exchange Act and the rules and regulations
thereunder (as now in effect) to file a statement on Schedule 13D with
the Commission as a "person" within the meaning of Section 13(d)(3) of
the Exchange Act disclosing beneficial ownership of Voting Securities
representing more than 5% of any class of Voting Securities.
1.33 TWENTY DAY AVERAGE. "Twenty Day Average" means the average
closing sale price of Common Stock on the Principal Trading Market for
the twenty (20) trading days preceding the earlier of the closing of,
or public announcement date concerning, the issuance of Voting
Securities by Company.
1.34 UNAFFILIATED DIRECTOR. "Unaffiliated Director" means a
director on the Board who is neither a Dow Affiliated Director nor a
Pakhoed Affiliated Director.
1.35 VOTING SECURITIES. "Voting Securities" means Common Stock
and any other Company securities entitled to vote for the election of
directors, or any security (including any preferred stock of Company)
convertible into or exchangeable for or exercisable for the purchase
of Common Stock or other Company securities entitled to vote for the
election of directors.
ARTICLE II
RESTRICTIONS ON ACQUISITION OF ADDITIONAL SHARES BY DOW
2.1 NO PURCHASES BEYOND PERCENTAGE LIMITATION. Except as
otherwise permitted herein and except as may occur as a consequence of
Dow's acquisition of Series A Preferred Stock pursuant to the Stock
Purchase Agreement, Dow shall not, directly or indirectly, acquire any
Voting Securities beyond its "Percentage Limitation". The
"Percentage Limitation" shall be 21% or such greater percentage of
Common Stock Equivalents as Dow may then own in accordance with this
Agreement, but in no event greater than 27%.
2.2 PERMITTED PURCHASES. If Dow's aggregate ownership of Common
Stock Equivalents falls below its then Percentage Limitation, Dow may
acquire additional shares of Common Stock, up to its Percentage
Limitation, at any time by open market purchases, partial tender
offer, or private transaction. If the Common Stock Equivalents
increase at any time and, as a consequence thereof Dow's aggregate
ownership of Common Stock Equivalents falls below its then Percentage
Limitation, Dow may acquire additional shares of Common Stock, up to
its Percentage Limitation, as follows:
(a) at any time by open market purchases, partial tender
offer, or private transaction; and/or
(b) Dow may, in accordance with Section 2.3, purchase
unissued or treasury shares of Common Stock from Company.
2.3 PROCEDURES CONCERNING DOW'S ACQUISITION OF COMMON STOCK FROM
COMPANY IN RESPONSE TO INCREASES IN COMMON STOCK EQUIVALENTS.
(a) Within thirty (30) days after any increase in Common
Stock Equivalents (other than an increase previously notified to Dow
under Section 2.5), Company shall give Dow written notice setting
forth the number of Common Stock Equivalents prior to the increase,
the number of Common Stock Equivalents after the increase, Dow's then
Percentage Limitation, the number of shares of Common Stock Dow may
purchase as a consequence of said increase, and the per share purchase
price for such shares.
(b) The purchase price per share of Common Stock purchased
under Section 2.2(b) shall be established as follows:
(i) if the Common Stock Equivalents increased as a
result of issuance by Company of one or more Voting Securities (other
than issuance of options under Company's stock option plans), the
price per share shall be the lesser of the Twenty Day Average or the
aggregate fair market value of all consideration received by Company
for such Voting Securities as determined by the Board (including
attribution of the consideration received with respect to each Voting
Security other than Common Stock) within thirty (30) days after the
issuance, divided by the number of Common Stock Equivalents issued by
Company; or
(ii) if the Common Stock Equivalents increased as a
result of Company's issuance of stock options under Company's stock
option plans, the purchase price shall be the closing sale price of
Common Stock on the Principal Trading Market for the last day of
Company's fiscal year in which such options were issued.
(c) Dow shall have the right to purchase from Company a
number of shares of Common Stock equal to its then Percentage
Limitation multiplied times the increase in the Common Stock
Equivalents. Dow shall have fifteen (15) days from receipt of
Company's notice pursuant to Section 2.3(a) above to notify Company in
writing whether it elects to purchase any of such shares of Common
Stock and, if it so elects, the number of shares it elects to
purchase. At the time Dow delivers its notice to Company, there shall
be a binding agreement between Dow and Company for the purchase
and sale of the number of shares of Common Stock elected by Dow. Dow
shall pay the purchase price to Company in immediately available
funds, and Company shall deliver certificates representing the shares
to Dow, on a date specified by Dow in its notice, which date shall not
be more than twenty (20) days after Dow delivers its notice to
Company.
2.4 LIMITATION ON DOW'S RIGHT TO PURCHASE COMMON STOCK PURSUANT
TO SECTION 2.2 IN THE EVENT OF A BUSINESS ACQUISITION BY COMPANY.
(a) Notwithstanding Section 2.2, Dow shall have no right
to purchase additional shares of Common Stock if (i) the Common Stock
Equivalents increased due to issuance by Company of Voting Securities
in connection with Company's acquisition of a business entity from a
third party, (ii) during the one year period following closing of such
an acquisition, Company repurchases a number of shares of Voting
Securities equal to or greater than the number of shares of Common
Stock Equivalents issued to the third party, and (iii) Company's plan
to repurchase shares was approved by a majority of the Unaffiliated
Directors and notice thereof was given to Dow, prior to the closing of
the acquisition. If Company does not within the one year period
repurchase a number of shares of Voting Securities equal to the number
of Common Stock Equivalents issued to the third party, Dow shall have
all rights under Section 2.2 to purchase shares of Common Stock up to
its Percentage Limitation. For purposes of Section 2.3, Company shall
give notice to Dow in accordance with Section 2.3(a) within thirty
(30) days after the end of the one year period, and the purchase price
to be paid by Dow to purchase shares from Company shall be established
in accordance with Section 2.3(b)(i) as of the date of the closing of
the business acquisition. Except as modified by the preceding
sentence, the provisions of Section 2.3 shall govern any such
purchase.
(b) The limitation contained in Section 2.4 shall only
apply to increases of up to fifteen (15%) in the Common Stock
Equivalents. If in connection with an acquisition Company issues
Voting Securities which cause the Common Stock Equivalents to increase
more than fifteen (15%), Dow shall have all rights under Section 2.2
to purchase Common Stock in connection with such increase over fifteen
(15%).
2.5 PERMITTED PURCHASE IF COMPANY PROPOSES TO ISSUE VOTING
SECURITIES FOR CASH. If Company proposes to issue Voting Securities
solely for cash pursuant to a registered offering or a private
placement, and as a consequence thereof Dow's aggregate ownership of
Common Stock Equivalents would fall below its then Percentage
Limitation, Company shall give Dow written notice of such fact (the
"Notice of Issue") at least thirty (30) days prior to the anticipated
date of such issuance stating the number of Common Stock Equivalents
to be issued and the anticipated price per Common Stock Equivalent.
[See also notice requirements in section 3.13 below.] Dow shall have
the right to purchase from Company a number of shares of Common Stock
equal to its then Percentage Limitation multiplied times the gross
number of Common Stock Equivalents to be issued including any shares
which Pakhoed or Dow may elect to purchase pursuant to either this
Agreement or the Pakhoed Standstill Agreement. Dow shall have fifteen
(15) days from receipt of the Notice of Issue to notify Company in
writing whether it elects to purchase any of such shares of Common
Stock and, if it so elects, the number of shares it elects to
purchase. At the time Dow delivers its election to Company, there
shall be a binding agreement between Dow and Company for the purchase
and sale of the number of shares of Common Stock elected by Dow. The
purchase price per share shall be the price per Common Stock
Equivalent at which the Voting Securities are actually issued by
Company; provided, however, that without Dow's consent the purchase
price paid by Dow shall not be more than one hundred twenty percent
(120%) of the anticipated price per Common
Stock Equivalent set forth in the Notice of Issue. Dow shall pay the
purchase price to Company in immediately available funds, and Company
shall deliver certificates representing the shares of Common Stock to
Dow, on the date of Company's issuance of the Voting Securities.
2.6 PERMITTED PURCHASE IN RESPONSE TO THIRD PARTY TENDER OFFER.
(a) If a tender or exchange offer is made by any Person or
13D Group (other than Dow or any Person acting in concert with Dow) to
acquire Voting Securities, Dow may make a tender offer for up to an
equivalent number of shares of such Voting Securities as are sought to
be purchased by the party making the other tender offer. If Dow
initiates a tender offer under this Section 2.6, the tender offer may
be on such terms as Dow shall elect and Company agrees that it shall
not in any way (whether by active opposition, Board announcement, or
otherwise) contest said tender offer.
(b) If, following the tender offer, Dow owns in the
aggregate more than 27% of the Common Stock Equivalents, Company shall
have the right, exercisable at any time during the six month period
following completion of Dow's tender offer, to purchase from Dow a
number of shares of such Voting Securities as will cause Dow to own in
the aggregate 27% of the Common Stock Equivalents following such
purchase. Company shall, within said six (6) month period, notify Dow
in writing whether it elects to purchase any of such shares and, if it
so elects, the number of shares it elects to purchase. At the time
Company delivers its notice to Dow, there shall be a binding agreement
between Dow and Company for the purchase and sale of the number of
shares of such Voting Securities elected by Company.
(c) The purchase price per share shall be the price paid by
Dow in the tender offer to the tendering shareholders, plus a prorata
share of the costs and expenses incurred by Dow in conducting said
tender offer. The prorata share of costs and expenses shall be the
aggregate of all costs and expenses directly incurred by Dow, divided
by the number of shares of Voting Securities acquired in the tender
offer. Company shall pay the purchase price to Dow in immediately
available funds, and Dow shall deliver certificates representing the
shares to Company, on a date specified by Company in its notice, which
date shall not be more than twenty (20) days after Company delivers
its notice to Dow.
(d) If Company's purchase is subject to or is voluntarily
submitted for shareholder approval, Dow shall vote all its Voting
Securities in favor of the purchase.
(e) If Company does not elect to purchase shares from Dow,
or elects to purchase only a portion of the shares under Section
2.6(b), Dow shall be entitled to retain the shares over 27%, but the
Percentage Limitation shall remain at 27% (or such lesser percentage
as it shall become from time to time thereafter).
2.7 PERMITTED PURCHASE WITH BOARD APPROVAL. Notwithstanding any
other provision of this Agreement, Dow may purchase additional shares
of Voting Securities at any time, if a majority of the Unaffiliated
Directors approve such purchase in advance.
2.8 PERMITTED PURCHASE BY AND REQUIREMENTS FOR 100% TENDER
OFFERS. Dow shall at any time have the right to acquire additional
shares of Common Stock by means of a tender offer in accordance with
the following requirements and procedures:
(a) Whenever Dow shall make a tender offer for shares of
Common Stock under this Section, Dow may not close the acquisition of
the tendered shares unless all of the following requirements have been
satisfied:
(i) Dow's offer shall have been made to all holders
of Common Stock;
(ii) Dow shall offer to purchase for cash all shares
tendered; and
(iii) Dow's offer shall have been accepted by
shareholders owning not less than two-thirds (2/3) of the outstanding
Common Stock.
(b) With respect to calculating whether Dow's offer has
been accepted by shareholders owning two-thirds (2/3) of the
outstanding Common Stock, the following shall apply:
(i) Common Shares beneficially owned by Dow and
Pakhoed shall be excluded from the outstanding Common Stock;
(ii) if one or more Core Shareholders do not tender
all of their shares of Common Stock, the shares not tendered shall be
excluded from the outstanding Common Stock.
2.9 MANDATORY DISPOSAL OF EXCESS SHARES. If in violation of any
provision of Article II Dow shall at any time hold in the aggregate in
excess of its then Permitted Percentage, Dow shall be required to
dispose of such excess shares by promptly selling, subject to
Company's right of first refusal under Section 3.8, sufficient Voting
Securities so that after such sale Dow shall own in the aggregate not
more than its then Permitted Percentage. If Dow fails to dispose of
shares of Voting Securities within ninety (90) days after receipt of
notice from Company advising Dow of its obligation so to dispose of
shares (it being understood that giving of notice by Company is not a
precondition to Dow's obligation to dispose of excess shares), Company
shall have the right to redeem at par value from Dow a number of
shares of Common Stock so that after such redemption the shares of
Voting Securities owned by Dow do not exceed Dow's then Permitted
Percentage.
2.10 MONTHLY REPORT OF OWNERSHIP. During the term of this
Agreement, Dow will furnish to Company, within ten (10) days after the
end of each calendar month in which Dow acquires or disposes of any
Voting Securities, a statement showing the number of shares of Voting
Securities acquired or disposed of during the just ended month and the
aggregate number of shares of Voting Securities held by Dow at the end
of such month. To the extent that any such acquisition or disposition
must be reported to the Commission, Dow may fulfill the statement
requirement in this Section 2.10 by providing to Company a copy of
such report to the Commission.
2.11 GENERAL RULE REGARDING ACQUISITION OF VOTING SECURITIES.
Dow agrees that any and all acquisitions of Voting Securities shall be
made in compliance with all applicable federal and state laws,
including securities laws, and in accordance with restrictions
generally imposed on members of the Board and their Affiliates with
respect to trading on non-public information. Dow agrees to
indemnify, defend and hold harmless Company, its officers, directors
and employees from and against any and all losses, claims,
liabilities, assertions and expenses incurred or suffered by any of
them, including attorneys' fees and costs of litigation, as a
consequence of a claim by
any party other than Company or any of its Affiliates that Dow
breached its obligations set forth in the preceding sentence.
ARTICLE III
SALES OF SHARES BY DOW AND RELATED RIGHTS AND OBLIGATIONS OF DOW AND COMPANY
3.1 GENERAL RESTRICTIONS ON RESALE OR OTHER DISPOSITION. During
the term of this Agreement, Dow shall not sell, transfer any
beneficial interest in, pledge, hypothecate or otherwise dispose of
any Voting Securities except in compliance with Article III.
3.2 ALLOWED SALES PURSUANT TO REGISTRATION RIGHTS. Subject to
Company's right of first refusal under Section 3.8, Dow may at any
time sell Common Stock by means of an offering made pursuant to the
registration rights set forth in Article VII below.
3.3 ALLOWED SALES PURSUANT TO RULE 144. Subject to Company's
right of first refusal under Section 3.8, Dow may at any time sell
Common Stock pursuant to Rule 144 of the General Rules and Regulations
under the Act, provided that Dow shall notify Company at least two
Business Days prior to the date of entering any sale or transfer order
of Common Stock pursuant to Rule 144, and provided further that, if
Company shall thereupon notify Dow of the pendency of its public
offering of any Voting Securities, Dow shall not effect any sales
under Rule 144 within 10 days prior to the commencement of or during
such offering.
3.4 ALLOWED PRIVATE SALES TO THIRD PARTIES OR PURSUANT TO TENDER
OFFER. Subject to Company's right of first refusal under Section 3.8,
Dow may at any time make private sales of Voting Securities to a third
person, including sales pursuant to a tender offer or exchange offer,
provided that without the express written consent of Company Dow shall
not sell, transfer any beneficial interest in, pledge, hypothecate or
otherwise dispose of any shares of Series A Preferred Stock other than
by conversion of Series A Preferred Stock to Common Stock.
3.5 ALLOWED PLEDGES. Dow may at any time make a bona fide
pledge of or grant a security interest in Voting Securities to a
commercial or an institutional bank or lender for money borrowed,
provided that the bank or lender acknowledges in writing that (a) it
has received a copy of this Agreement and (b) its sale of Voting
Securities following foreclosure shall be subject to Company's right
of first refusal under Section 3.8 (as if such bank or lender were
Dow).
3.6 ALLOWED TRANSFERS TO DOW AFFILIATES. Dow and Dow Affiliates
may at any time transfer Voting Securities among themselves, provided
that in the reasonable opinion of counsel acceptable to Company and
Dow such transfer would have no clear, adverse impact of a financial
character on Company, and would not adversely affect the liabilities
and/or responsibilities of Dow to Company, and provided further that
the transferee shall agree in advance in writing to be bound by the
terms of this Agreement.
3.7 ALLOWED TRANSFERS UPON APPROVED BUSINESS DISPOSITION. Dow
may dispose of Voting Securities in conjunction with a merger or
consolidation in which Company is acquired, or in conjunction with a
sale of all or substantially all of Company's assets, provided a
majority of the Board approved such merger, consolidation, or sale.
3.8 RIGHT OF FIRST REFUSAL. If during the term of this
Agreement, Dow desires to sell any Voting Securities in accordance
with Section 3.2, 3.3, or 3.4, Company shall have a right of first
refusal to purchase said Voting Securities in accordance with the
procedures set forth in Section 3.9 below.
3.9 PROCEDURES FOR RIGHT OF FIRST REFUSAL.
(a) If Dow desires to sell to a third party all or part of
its Voting Securities in accordance with Section 3.4 above ("Private
Sale"), or if Dow desires to sell all or part of its Common Stock in
the open market pursuant to Section 3.2 or 3.3 above ("Market
Disposition Program"), Dow shall transmit to Company and to each
Unaffiliated Director a written notice ("Notice of Proposed Sale")
setting forth:
(i) if a Private Sale, (A) as to each Person to whom
such sale is proposed to be made: (1) the name, address and principal
business activity of such Person; (2) the number of shares of Voting
Securities proposed to be sold to such Person; (3) the manner in which
the sale is proposed to be made; and (4) the price at which or other
consideration for which, and the material terms upon which, such sale
is proposed to be made, and (B) representing that the Private Sale is,
to the best knowledge of Dow, bona fide; and
(ii) if sales pursuant to a Market Disposition
Program: (A) the approximate date the sales are scheduled to commence;
and (B) the amount of Common Stock sought to be disposed of.
(b) Upon receipt of the Notice of Proposed Sale, Company
shall have an option to purchase, in the case of a Private Sale, all
but not less than all of the Voting Securities proposed to be sold,
and in the case of a Market Disposition Program, all, if the Market
Disposition Program is a firm commitment public offering, or, if it is
not such an offering, any part, of the Common Stock proposed to be
disposed of, on the following terms and conditions:
(i) If the option arises in connection with a
Private Sale, the purchase price shall be the price specified in the
Notice of Proposed Sale.
(ii) If the option arises in connection with a Market
Disposition Program, the purchase price per share of Common Stock
shall be the Twenty Day Average determined as if the day Dow delivers
the Notice of Proposed Sale to Company is the closing date of an
issuance of securities by Company in the absence of any public
announcement.
(iii) If a majority of the Unaffiliated Directors
determine that it is in the best interests of Company to exercise the
option, they shall direct Company to send a written notice (the
"Notice of Exercise") to Dow within thirty (30) days after the Notice
of Proposed Sale is received by Company specifying the number of
shares Company is purchasing; provided, however, that in the case of a
tender offer, Dow must receive the Notice of Exercise not less than
forty-eight (48) hours prior to the earlier of (A) the expiration of
the tender offer or (B) any date after which shares tendered may be
treated less favorably than shares tendered prior thereto. If
approval of such purchase by Company's shareholders is required by law
or Company's Restated Certificate of Incorporation, and if the Private
Sale is in response to a tender offer, Company shall waive its right
of first refusal granted under Section 3.8; otherwise, Company's
Notice of Exercise shall be subject to receipt of such shareholder
approval,
which Company shall use its best efforts to obtain as soon as
possible, and in any event within one hundred twenty (120) days after,
the date of the Notice of Exercise. Company's failure to obtain
shareholder approval within the one hundred twenty (120) day period
shall give Dow the right to proceed with the proposed sale under
Section 3.9(c). If such repurchase is subject to shareholder approval,
Dow shall vote all its Voting Securities in favor of the purchase.
(iv) Upon Dow's receipt of the Notice of Exercise,
there shall be a binding agreement between Dow and Company for the
purchase and sale of the number of shares contained in the Notice of
Exercise. The closing of the purchase and sale shall occur on the
thirtieth Business Day following Dow's receipt of the Notice of
Exercise. At the closing Dow will deliver to Company certificates for
the Voting Securities to be sold, duly endorsed for transfer or
accompanied by a duly executed stock power, and Company will deliver
to Dow the purchase price as follows: if Company's purchase is
following Dow's proposed Private Sale, Company shall pay Dow the price
specified in the Notice of Proposed Sale in the same manner (and the
sale shall be upon the same terms) specified therein, and if Company's
purchase is following Dow's proposed Market Disposition Program,
Company shall pay Dow at the closing for the shares purchased in
immediately available funds.
(v) Company may assign its right to purchase the
Voting Securities and may designate in the Notice of Exercise one or
more Persons to take title to all or any part of the Voting
Securities, but this shall not relieve Company of its obligation to
pay the purchase price.
(c) If following receipt of a Notice of Proposed Sale
Company fails to give Dow a Notice of Exercise within the prescribed
time period, Dow shall be free to effect such sale on the following
terms and conditions:
(i) if a Private Sale was proposed, Dow may effect
such sale at any time during the period ending one hundred twenty
(120) days after the date Company's Notice of Exercise was required to
be given, to the Person or Persons specified in the Notice of Proposed
Sale for the consideration and on the terms specified in said notice;
and
(ii) if a Market Disposition Program was proposed, Dow
may effect such sales at any time during the period ending one hundred
eighty (180) days after the date Company's Notice of Exercise was
required to be given.
(d) If Dow does not make the sales within the time periods
provided above, the Voting Securities so proposed to be sold will once
again become subject to this Agreement to the same extent as if such
sales had not been proposed.
3.10 DOW'S COVENANTS WITH RESPECT TO DISTRIBUTION OF SHARES. In
any transaction or transactions under Section 3.2 or 3.3, Dow shall
use its best efforts, and shall cause any underwriter involved to use
its best efforts, to sell the Common Stock in the United States and in
a manner which will effect the broadest possible distribution, with no
sales to any one person or group (as defined in the Exchange Act) in
excess of 10% of the Common Stock sold in such sale.
3.11 COMPANY'S UNDERTAKING TO FILE REPORTS AND COOPERATE IN RULE
144 TRANSACTIONS. During the term of this Agreement, Company shall
use its best efforts to file, on a timely basis, all annual, quarterly
and other reports it is required to file
under Sections 13 and 15(d) of the Exchange Act, and the Rules and
Regulations of the Commission thereunder, as amended from time to
time. In the event of any proposed sales of Common Stock by Dow under
Section 3.3, Company shall cooperate with Dow to enable such sales to
be made in accordance with applicable laws, rules and regulations, the
requirements of Company's transfer agent, and the reasonable
requirements of the broker through which the sales are proposed to be
executed, and shall, upon request, furnish unlegended certificates
representing Common Stock in such numbers and denominations as Dow
shall reasonably require for delivery in connection with such sales.
3.12 ALLOWED SALES PURSUANT TO COMPANY REPURCHASE.
(a) In the event that Company agrees to repurchase, redeem
or otherwise acquire (collectively, "redeem") any shares of Common
Stock from one, some, or all of its shareholders, Company shall
transmit to Dow a written notice ("Notice of Proposed Company
Purchase") setting forth (i) the number of shares of Common Stock
proposed to be redeemed; (ii) the manner in which the redemption is
proposed to be made; (iii) the price at which and the material terms
upon which such redemption is proposed to be made; and (iv) the
approximate date the redemption is scheduled to occur.
(b) Upon receipt of the Notice of Proposed Company Purchase
Dow shall have an option to have redeemed by the Company that number
of shares of Common Stock determined by multiplying the percentage
that Dow's Common Stock Equivalents represents of the Company's
outstanding Common Stock Equivalents times the number of shares of
Common Stock that Company proposes to redeem from its shareholders
other than Dow. Dow's option as specified in the preceding sentence
shall be on the following terms and conditions: (i) the purchase
price for Dow's shares shall be the same price per share as the price
paid to shareholders other than Dow; (ii) all other terms and
conditions of the redemption shall be the same as the terms and
conditions as the redemption with the shareholders other than Dow;
(iii) Dow shall deliver certificates for the Common Stock to be
redeemed, duly endorsed for transfer or accompanied by a duly executed
stock power; and (iv) the closing of the purchase and sale shall occur
on that day scheduled for the redemption of shares of shareholders
other than Dow; provided, however, that this Section 3.12 shall not
apply with respect to the redemption of up to 1,000,000 shares of
Common Stock from Pakhoed during the six (6) months following the
Effective Date.
3.13 RIGHTS OF COSALE.
(a) In the event that Company proposes to issue any shares
of Common Stock in one or more related transactions, other than a
registered public offering described in section 7.3, solely for cash
or "Marketable Securities" (which term shall mean any securities which
are readily tradable on a recognized exchange, national automated
quotation system or regular over-the-counter market and which the
Company does not intend to hold for more than one year), Company shall
transmit to Dow a Notice of Issue (as defined in section 2.5) setting
forth (i) the number of shares of Common Stock proposed to be sold;
(ii) the manner in which the sale is proposed to be made; (iii) the
price at which and the material terms (including anticipated expenses)
upon which such sale is proposed to be made; and (iv) the approximate
date the sale is scheduled to occur.
(b) Upon receipt of the Notice of Issue, Dow shall have an
option to sell that number of shares of Common Stock determined by
multiplying the percentage that
Dow's Common Stock Equivalents represent of the Company's outstanding
Common Stock Equivalents times the number of shares of Common Stock
that Company proposes to issue, on the following terms and conditions:
(i) The sale price per share will be, and Dow will
receive, the price (less expenses of the transaction allocable to
Common Stock sold by Dow) specified in the Notice of Issue in the same
manner (and the sale shall be upon the same terms) specified therein;
(ii) If Dow determines to exercise the option, it
shall send a written notice to Company within fifteen (15) days after
the Notice of Issue is received by Dow specifying the number of shares
Dow proposes to sell;
(iii) Dow shall execute an agreement for the sale of
such shares in form reasonably acceptable to Dow, Company and the
purchaser of the Common Stock, and Dow shall deliver certificates for
the Common Stock to be sold, duly endorsed for transfer or accompanied
by a duly executed stock power, together with such other documents as
may be reasonably requested by Company or the purchaser of the Common
Stock; and
(iv) The closing of the purchase and sale shall occur
on that day scheduled for the issuance of shares by the Company.
ARTICLE IV
LEGENDS AND STOP TRANSFER ORDERS
4.1 PLACEMENT OF LEGENDS AND ENTRY OF TRANSFER ORDERS. Dow
agrees:
(a) that, within ten (10) Business Days after its
acquisition of any certificates evidencing Voting Securities to submit
such certificates to Company for placement on the face thereof the
following legends:
"The shares represented by this certificate are
subject to the restrictions on disposition set
forth in and to the other provisions of an Amended
and Restated Standstill Agreement dated as of
May 13, 1994, between [Company] and [Dow].
Copies of such Agreement are on file at the
respective offices of [Company] and [Dow].";
and such additional legends designed to ensure compliance with Federal
and State laws as counsel for Company may reasonably request; and
(b) to the entry of stop transfer orders with the transfer
agents of any such Voting Securities, against the transfer of such
legended certificates except in compliance with this Agreement.
4.2 REMOVAL OF LEGENDS AND STOP TRANSFER ORDERS. Company agrees
that it will, upon receipt of an opinion from its counsel that it is
appropriate so to do and upon the presentation to its transfer agent
of the certificates containing the legends provided for in Section
4.1(a), remove such legends and withdraw the stop transfer
orders provided for in Section 4.1(b) with respect to such
certificates, upon the earlier of the following:
(a) any sale of the shares represented by such certificates
made under Section 3.2, 3.3 or 3.4; or
(b) termination of this Agreement.
ARTICLE V
CERTAIN AGREEMENTS OF DOW AND COMPANY
5.1 FUTURE ACTIONS. Dow shall not, unless the prior written
consent of the Board (in which a majority of the Unaffiliated
Directors shall concur) has been obtained, and then only to the extent
express written consent has been obtained:
(a) at any time before the expiration of five (5) years
after the Effective Date, solicit proxies or become a "participant" in
a "solicitation" (as such terms are defined in Regulation 14A under
the Exchange Act) in opposition to the recommendation of the majority
of the directors on the Board with respect to any matter, provided
that this provision shall not apply if Pakhoed is not at such time
subject to substantially the same restriction; or
(b) deposit any Voting Securities in a voting trust or
subject them to a voting agreement or other arrangement of similar
effect; provided, however, that nothing in this Section 5.1 shall
preclude Dow from so depositing any Voting Securities if such trust,
agreement or arrangement is, and continues to be during the term of
this Agreement, solely by and among Dow and Dow Affiliates; or
(c) join a partnership, limited partnership, syndicate or
other group for the purpose of acquiring, holding or disposing of
Voting Securities within the meaning of Section 13(d) of the Exchange
Act; or
(d) induce or attempt to induce any other Person to
initiate a tender offer for any securities of Company, or to effect
any change of control of Company, or take any action for the purpose
of convening a stockholders' meeting of Company; or
(e) acquire, by purchase or otherwise, more than 1% of any
class of equity securities of any entity which, prior to the time Dow
acquires more than 1% of such class, is publicly disclosed (by filing
with the Commission or otherwise) to be the beneficial owner of more
than 5% of any class of the Voting Securities; provided, that if Dow
owns in the aggregate in excess of 1% of any such entity, it shall
divest such excess within seven (7) days of acquiring such excess,
and, provided further, that upon being notified by Company in writing
that an entity owns in excess of 5% of any class of the Voting
Securities, Dow shall affirm in writing to Company that Dow does not
own, in the aggregate, more than 1% of any class of equity securities
of such Person.
5.2 ACQUISITIONS AND TRANSFERS IN CONTRAVENTION OF AGREEMENT.
Notwithstanding Company's rights to seek injunctions or other relief,
any Voting Securities acquired or transferred by Dow or contravention
of this Agreement may not be voted on any matter on which shareholders
of Company are entitled to vote.
5.3 COMPANY'S ISSUANCE OF SECURITIES. During the term of this
Agreement, Company shall not issue any security (including without
limitation any Voting Security) which provides the holder(s) thereof
with any extraordinary or special voting rights or any right to veto
any action of Company, unless such issuance is approved in advance by
a not less than eighty percent (80%) vote of the Board. Further,
Company shall not consider or approve any such issuance prior to the
Effective Date.
5.4 RESTRICTIONS ON CONVERSION OF SERIES A PREFERRED STOCK. The
Company agrees that it will not, without Dow's written consent,
require, as permitted by a Certificate of Designation, the conversion
to Common Stock of Series A Preferred Stock owned by Dow if such
conversion would cause Dow's ownership of Common Stock Equivalents to
exceed 19.9%.
ARTICLE VI
BOARD OF DIRECTORS
6.1 SIZE OF BOARD. If Dow so elects, on or before the Effective
Date, Company shall make its best efforts to create, by requesting one
or more members of the Board to resign, a vacancy on the Board and
appoint, effective as of the Effective Date, or as soon thereafter as
possible, an additional individual designated by Dow to serve as a
member of the Board. The parties agree the size of the Board shall
remain at twelve or such other number as may be acceptable to Dow and
Pakhoed.
6.2 TERMS. The Dow Affiliated Director appointed pursuant to
Section 6.1 shall have an initial term equal to the unexpired term of
the director who resigned pursuant to Section 6.1. After the initial
term of any Affiliated Director expires, his or her successor shall
serve a term of three (3) years as provided in the Restated
Certificate of Incorporation of Company.
6.3 PROPORTIONAL REPRESENTATION.
(a) If Dow so elects, Company shall cause representatives
designated by Dow to be nominated for election to the Board so as to
provide Dow with representation on the Board proportionate to its
share ownership of Common Stock Equivalents rounded down to the
nearest whole number. With respect to committees of the Board, Dow
shall be entitled to be represented on any committee with respect to
which Dow requests representation.
(b) Dow shall vote its shares of Common Stock so as to
provide other Company shareholders with corresponding proportionate
representation. If, pursuant to the Restated Certificate of
Incorporation of Company, cumulative voting for the election of
Company directors is required, Dow may initially vote its shares to
ensure that its then proportionate number of Dow Affiliated Directors
are elected. Dow agrees that, once its proportionate number of Dow
Affiliated Directors are elected, Dow shall vote its shares of Common
Stock so as to elect persons to the Board who have been designated by
the Unaffiliated Directors.
(c) Company shall use its best efforts to cause a change in
Board representation to be effected as soon as reasonably possible
following a change in Dow's share ownership. At Dow's request Company
shall cause such change to occur at the first Board meeting to be held
following a change in Dow's share ownership, which
meeting shall be held not more than ninety (90) days following the
change in Dow's share ownership. Company may effect changes in Board
representation by increase in the size of the Board or by resignations
or retirements of Board members. Notwithstanding the foregoing, Dow's
right to proportional Board representation shall not cause the number
of Dow Affiliated Directors to (i) decrease during the one year period
during which Company has the right to purchase Voting Securities under
Section 2.5(a), or (ii) increase beyond 27% during the six month
period during which Company has the right to purchase Voting
Securities under Section 2.7(b)
6.4 PUBLIC POLICY COMMITTEE.
(a) Company shall cause the Public Policy Committee of the
Board to be continued during the term of this Agreement. The Public
Policy Committee shall be responsible to audit and recommend to the
Board policies with respect to Company health and safety,
environmental, insurance and real estate affairs. The Committee's
activities will include performing audits of and making
recommendations concerning existing and proposed Company real property
sites and insurance coverage, consultation concerning budgets within
the areas of the Committee's responsibility, and review of approved
lists of legal and other consultants to provide services to Company in
the areas of the Committee's responsibility. Meetings of the Public
Policy Committee shall be called on notice by any member of the
Committee, by the Chairman of the Board, and/or by the Senior Vice
President with responsibility for environmental policy issues. The
Chief Executive Officer shall be a member of the Committee.
(b) Company shall continue during the term of this
Agreement to assign responsibility for environmental policies to a
Senior Vice Presidents or other comparable senior position and title.
The Senior Vice President shall be responsible for the health, safety
and environmental affairs of Company. The Senior Vice President shall
report to Company's Chief Executive Officer.
ARTICLE VII
REGISTRATION RIGHTS
7.1 DURATION OF REGISTRATION RIGHTS. Dow's rights to have
Company register shares of Common Stock provided in this Article VII
shall terminate upon termination of this Agreement. Rights of a
Holder other than Dow to have Company register shares of Common Stock
provided in this Article VII shall terminate two (2) years after
Holder acquired its Common Stock and shall survive termination of this
Agreement during such two year period.
7.2 DEMAND REGISTRATION COVENANT.
(a) If a Holder requests in writing that Company register
under the Act any Common Stock then owned by Holder, Company will use
its best efforts to cause the offering and sale to be registered as
soon as reasonably practicable. In connection therewith Company shall
prepare and file a registration statement under the Act on such form
as Company shall determine to be appropriate; provided, however, that
Company shall not be obligated to file more than two registration
statements pursuant to this Section 7.2 during any 12-month period.
The request shall specify the amount of Common Stock intended to be
offered and sold, shall express Holder's present intent to offer such
Common Stock for distribution, shall describe the nature or method of
the proposed offer and sale, and shall contain the undertaking of
Holder to comply with all applicable requirements of this Article VII.
(b) Upon receipt of a request for registration under
Section 7.2, Company will promptly give notice to all Holders other
than those initiating the request and provide a reasonable opportunity
for such Holders to participate in such registration. Any such other
Holder must notify Company in writing of its desire to participate,
within thirty (30) days of receipt of Company's notice.
(c) Any request for registration under Section 7.2 must be
for a firm commitment public offering to be managed by one or more
underwriters selected pursuant to Section 7.5(c). If, in the written
opinion of the underwriters, marketing factors require a limitation of
the number of shares to be underwritten, and if the total amount of
securities that Holders (initiating and non-initiating) request
pursuant to Section 7.2 to be included in such offering exceeds the
amount of securities that the underwriters reasonably believe
compatible with the success of the offering, Company shall only be
required to include in the offering the amount of Common Stock that
the underwriters believe will not jeopardize the success of the
offering, and such amount shall be allocated among such Holders in
proportion to the respective amounts of Common Stock proposed to be
sold by each of the Holders. Any shares of Common Stock that are so
excluded from the underwriting shall be excluded from the
registration.
(d) If within ninety (90) days after receipt of a request
under Section 7.2(a) and any requests under Section 7.2(b) Company
shall have obtained (i) from Commission a "no-action" letter in which
the Commission has indicated that it will take no action if, without
registration under the Act, Holders dispose of the Common Stock
covered by the request(s) in the manner proposed or (ii) an opinion of
its counsel (concurred in by counsel for the requesting Holder(s))
that no registration under the Act is required, Company need not
comply with such request or request(s); provided, however, that
receipt of such "no-action" letter or opinion shall not constitute a
registration for the purpose of determining Company's obligations to
Holders under Section 7.2; and provided, further, that in such event
counsel for Company shall opine whether, by reason of the "no-action"
letter or otherwise, the removal of any legend from certificates
representing all shares to which such "no-action" letter or opinion
refers is permissible, and, if so, Company shall remove from such
certificates all legends no longer required and shall rescind any stop-
transfer instructions previously communicated to its transfer agent
relating to such certificates.
7.3 PARTICIPATION REGISTRATION COVENANT. If Company shall
propose registration under the Act of an offering of Common Stock,
Company shall give prompt written notice of such fact to each Holder
and will use all reasonable efforts to cause the registration of such
number of shares of Common Stock then owned by Holders as Holders
shall request, within fifteen (15) days after receipt of such notice,
to be included, upon the same terms (including the method of
distribution) of any such offering; provided, however, that (a)
Company shall not be required to give notice or include such Common
Stock in any such registration if the proposed registration (i) is not
a primary registration of securities by Company for its own account,
or (ii) is primarily (A) a registration of a stock option or
compensation plan or of securities issued or issuable pursuant to any
such plan, or (B) a registration of securities proposed to be issued
in exchange for securities or assets of, or in connection with a
merger or consolidation with, another corporation; (b) the offering of
Common Stock by Holders shall comply with Section 3.10 above; and (c)
Company may, in its sole discretion and without the consent of the
Holders, withdraw such registration statement and abandon the proposed
offering.
7.4 COMPANY'S OBLIGATIONS IN CONNECTION WITH REGISTRATIONS. In
connection with any registration of Common Stock undertaken by Company
under Article VII, Company shall:
(a) furnish to Holders or their underwriter such copies of
any prospectus (including any preliminary prospectus) Holders may
reasonably request to effect the offering and sale, but only while
Company is required under the provisions hereof to cause the
registration statement to remain current;
(b) use its best efforts to qualify the offering under
applicable Blue Sky or other state securities laws to enable Holders
to offer and sell the Common Stock; provided, however, that Company
shall not be obligated to qualify as a foreign corporation to do
business under the laws of any jurisdiction in which it is not then
qualified or to file any general consent to service of process;
(c) furnish Holders, at the expense of Company, with
unlegended certificates representing ownership of the Common Stock
being sold in such numbers and denominations as Holders shall
reasonably request, meeting the requirements of the Principal Trading
Market;
(d) use its best efforts to cause the registration
statement to remain current for thirty (30) days following its
effective date or such lesser period as the underwriters may agree;
and
(e) instruct the transfer agent(s) and the registrar(s) of
Company's securities to release the stop transfer orders with respect
to the Common Stock being sold.
7.5 CONDITIONS TO OBLIGATIONS REGISTRATION COVENANTS. Company's
obligations to register the Common Stock owned by Holders under
Article VII are subject to the following conditions.
(a) Company (upon the decision of a majority of the
Unaffiliated Directors) shall be entitled to postpone for up to ninety
(90) days the filing of any registration statement under Section 7.2,
if at the time it receives the request for registration such
Unaffiliated Directors determine, in their reasonable judgment, that
such registration and offering would materially interfere with any
financing, acquisition, corporate reorganization or other material
transaction involving Company or any of its Affiliates. Company shall
promptly give Holders written notice of such determination.
(b) If, in the opinion of Company's Investment Banking
Firm, a reduction is desirable in the number of shares of Common Stock
offered for sale by the Company and Holders, pursuant to a request for
registration under Section 7.3, to permit the orderly distribution and
sale of the securities being offered, then Company shall only be
required to include in the offering the amount of Common Stock that
the underwriters believe will not jeopardize the success of the
offering, which shares will be allocated among the Company, Dow and
Holders as follows: First to be included shall be Common Stock owned
by Dow equal to the total number of shares to be included in the
offering multiplied by Dow's then current ownership percentage of
Common Stock Equivalents; Second to be included shall be the number of
shares requested by the Company to be included in the offering; and
Third, with respect to any shares remaining to be included in the
offering (if any), there shall be included that number of shares of
each Holder (including Dow) multiplied by a fraction, the numerator of
which is each
Holder's percentage of Common Stock Equivalents and the denominator
of which is the total of all Holders' percentage of Common Stock
Equivalents. If Company shall require such a reduction, Holders shall
have the right to withdraw from the offering.
(c) If Holders request registration pursuant to Section
7.2, (i) the managing underwriter shall be an Investment Banking Firm
selected by the Holders and approved by Company (which approval will
not be unreasonably withheld) and (ii) Company will enter into an
underwriting agreement containing representations, warranties and
agreements not materially different from those customarily included in
underwriting agreements with an issuer for a secondary distribution;
provided, however, that Company will not be obligated to indemnify the
underwriters on terms materially different from those set forth in
Section 7.8(a).
(d) Company may require, as a condition to fulfilling its
obligations under the registration covenants in Section 7.2 and 7.3,
the indemnification agreements provided in Section 7.8(b) from Holders
and the underwriters.
(e) It shall be a condition precedent to the obligations of
Company to take action pursuant to this Article VII that each Holder
whose Common Stock is being registered, and each underwriter
designated by such Holder, will furnish to Company such information
and materials as Company may reasonably request and as shall be
required in connection with the action to be taken by Company. To the
extent possible Holders shall provide Company with any information and
materials required to obtain acceleration of the effective date of the
registration statement.
(f) If, in the reasonable opinion of counsel to Company it
is necessary or appropriate for Company to comply with any applicable
rule, regulation, or release promulgated by the Commission, each
Holder whose Common Stock is being registered and any underwriter
participating in such public offering shall execute and deliver to
Company an appropriate agreement, in form satisfactory to counsel for
Company, that such Holder or underwriter will comply with all
prospectus delivery requirements of the Act and with all
antistabilization, manipulation, and similar provisions of Section 10
of the Exchange Act and any rules issued thereunder by the Commission,
and will furnish to Company information about sales made in such
public offering.
(g) Holders of Common Stock included in the registration
statement shall not (until further notice) effect sales thereof after
receipt of written notice (which may include notice by telegraph) from
Company to suspend sales, to permit Company to correct or update a
registration statement or prospectus; provided, however, that the
obligations of Company with respect to maintaining any registration
statement current and effective shall be extended by a period of days
equal to the period such suspension is in effect.
(h) At the end of the period during which Company is
obligated to keep any registration statement current and effective
(and any extensions thereof required by the preceding paragraph), and
upon receipt of notice from Company of its intention to remove from
registration the securities covered by such registration statement
that remain unsold, Holders of Common Stock included in the
registration statement shall discontinue sales of such Common Stock
pursuant to such registration statement, and each such Holder shall
notify Company of the number of shares registered belonging to such
Holder that remain unsold promptly following receipt of such notice
from Company.
(i) No Holder shall have any right to take any action to
restrain, enjoin, or otherwise delay any registration as the result of
any controversy that might arise with respect to the interpretation or
implementation of this Article VII.
7.6 EXPENSES.
(a) To the extent the expenses of registration incurred in
connection with a demand registration statement pursuant to Section
7.2 exceed the amount which Company would otherwise have incurred in
its normal Commission compliance work (which amount Company shall
pay), all Holders participating in such registration shall pay all
such expenses including, without limitation, all Commission and Blue
Sky registration and filing fees, printing expenses, fees and
disbursements of legal counsel for Company and Blue Sky counsel,
transfer agents' and registrars' fees, fees and disbursements of
experts used by Company in connection with such registration, and
expenses incidental to any post-effective amendment to any such
registration statement, provided that Company shall pay such expenses
if the registration statement is filed on Form S-3 and coordinated
with Company's other filings with the Commission so as to avoid the
necessity of any amendments to such filings or any special audit by
Company's independent auditors. Further, such participating Holders
shall pay all underwriting discounts, commissions and expenses, fees
and disbursements of their counsel and accountants, and expenses of
any special audits of Company incidental to or required in connection
with such registration.
(b) In connection with any registration pursuant to Section
7.3, Company shall pay all Commission and Blue Sky registration and
filing fees, underwriting discounts, commissions and expenses,
printing expenses, fees and disbursements of legal counsel for Company
and Blue Sky counsel, transfer agents' and registrars' fees, fees and
disbursements of experts used by Company in connection with such
registration, expenses of any special audits of Company incidental to
or required by such registration, and expenses incidental to any post-
effective amendment to any such registration statement, except to the
extent the aggregate of such costs exceeds the amount which Company
would have expended in conducting an offering of only the shares sold
by it, and the participating Holders pro rata shall pay such excess
based on the number of shares of Common Stock offered by each pursuant
to such registration statement. Such Holders shall pay all expenses
directly attributable to the inclusion in the offering of Common Stock
being sold by the Holders, including without limitation fees and
disbursements of their own counsel and accountants.
7.7 ASSIGNABILITY OF REGISTRATION RIGHTS. The registration
rights afforded Dow in this Article VII shall be assignable to a
transferee of Common Stock from Dow so long as (i) such transferee has
acquired not less than 500,000 shares of Common Stock (as adjusted
from time to time to reflect stock splits, stock dividends and similar
changes in the capitalization of Company) from Dow, (ii) such
transferee has agreed with Company in writing to comply with all
applicable provisions of this Article VII, and (iii) Dow has otherwise
complied with all provisions of this Agreement which affect its right
to sell, transfer or otherwise dispose of shares of Common Stock. For
a transfer of registration rights to be effective, Dow shall give
Company written notice at the time of such transfer stating the name
and address of the transferee and identifying the shares with respect
to which the rights under this Article VII are being assigned.
7.8 INDEMNIFICATION.
(a) In the case of each registration effected by Company
pursuant to Section 7.2 or 7.3, to the extent permitted by law Company
("indemnifying party") agrees to indemnify and hold harmless each
Holder, its officers and directors, and each underwriter within the
meaning of Section 15 of the Act, against any and all losses, claims,
damages, liabilities or actions to which they or any of them may
become subject under the Act or any other statute or common law,
including any amount paid in settlement of any litigation, commenced
or threatened, if such settlement is effected with the written consent
of Company, and to reimburse them for any legal or other expenses
incurred by them in connection with investigating any claims and
defending any actions, insofar as any such losses, claims, damages,
liabilities or actions arise out of or are based upon (i) any untrue
statement or alleged untrue statement of a material fact contained in
the registration statement relating to the sale of such shares, or any
post-effective amendment thereto, or the omission or alleged omission
to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, (ii) any
untrue statement or alleged untrue statement of a material fact
contained in any preliminary prospectus, if used prior to the
effective date of such registration statement, or contained in the
final prospectus (as amended or supplemented if Company shall have
filed with the Commission any amendment thereof or supplement thereto)
if used within the period during which Company is required to keep the
registration statement to which such prospectus relates current under
Section 7.4(d) (including any extensions of such period as provided in
Section 7.5(g)), or the omission or alleged omission to state therein
(if so used) a material fact necessary to make the statements therein,
in light of the circumstances under which they were made, not
misleading; provided, however, that the indemnification agreement
contained in this Section 7.8(a) shall not (x) apply to such losses,
claims, damages, liabilities or actions arising out of, or based upon,
any such untrue statement or alleged untrue statement, or any such
omission or alleged omission, if such statement or omission was made
in reliance upon and in conformity with information furnished to
Company by such Holder or underwriter for use in connection with
preparation of the registration statement, any preliminary prospectus
or final prospectus contained in the registration statement, or any
amendment or supplement thereto, or (y) inure to the benefit of any
underwriter or any Person controlling such underwriter, if such
underwriter failed to send or give a copy of the final prospectus to
the Person asserting the claim at or prior to the written confirmation
of the sale of such securities to such Person and if the untrue
statement or omission concerned had been corrected in such final
prospectus.
(b) In the case of each registration effected by Company
pursuant to Section 7.2 or 7.3 above, each Holder and each underwriter
of the shares to be registered (each such party and such underwriters
being referred to severally as an "indemnifying party") shall agree in
the same manner and to the same extent as set forth in Section 7.8(a)
to indemnify and hold harmless Company, each Person (if any) who
controls Company within the meaning of Section 15 of the Act, the
directors of Company and those officers of Company who shall have
signed any such registration statement, with respect to any untrue
statement or alleged untrue statement in, or omission or alleged
omission from, such registration statement or any post-effective
amendment thereto or any preliminary prospectus or final prospectus
(as amended or supplemented, if amended or supplemented) contained in
such registration statement, if such statement or omission was made in
reliance upon and in conformity with information furnished to Company
by such indemnifying party for use in connection with the preparation
of such registration statement or any preliminary prospectus or final
prospectus contained in such registration statement or any such
amendment or supplement thereto.
(c) Each indemnified party will, promptly after receipt of
written notice of the commencement of an action against such
indemnified party in respect of which indemnity may be sought under
this Section 7.8, notify the indemnifying party in writing of the
commencement thereof. In case any such action shall be brought
against any indemnified party and it shall so notify an indemnifying
party of the commencement thereof, the indemnifying party will be
entitled to participate therein and to the extent it may wish, jointly
with any other indemnifying party similarly notified, to assume the
defense thereof with counsel satisfactory to such indemnified party,
and after notice from the indemnifying party to such indemnified party
of its election so to assume the defense thereof, the indemnifying
party will not be liable to such indemnified party under this Section
7.8 for any legal or other expenses subsequently incurred by such
indemnified party in connection with the defense thereof other than
reasonable costs of investigation. The indemnity agreements in this
Section 7.8 shall be in addition to any liabilities which the
indemnifying parties may have pursuant to law.
ARTICLE VIII
TERMINATION
8.1 TERMINATION. This Agreement shall terminate upon the
earliest to occur of the following:
(a) Dow's completion of a tender offer in accordance with
Section 2.11; or
(b) the date Dow owns in the aggregate less than five
percent (5%) (provided that such percentage shall be ten percent (10%)
if the Pakhoed Standstill Agreement is terminated) of the then Common
Stock Equivalents; or
(c) if elected by Dow, exercisable upon delivery of written
notice thereof to Company, upon the failure of Company to comply with
its obligations under this Agreement and cure of such failure does not
occur within thirty (30) days after Dow gives written notice of such
failure to Company; or
(d) if elected by Company, exercisable upon delivery of
written notice thereof to the Dow, upon the failure of Dow to comply
with its obligations under this Agreement and cure of such failure
does not occur within thirty (30) days after Company gives written
notice of such failure to Dow.
8.2 EXTENDED CURE PERIOD. Notwithstanding Sections 8.1(c) and
8.1(d), the parties agree that if the nature of the failure requires
that more than thirty (30) days are necessary to cure, this Agreement
shall not terminate if the failing party commences a cure within the
thirty (30) day period and thereafter continuously and diligently
pursues all steps necessary to cure the failure up to and including
completion of the cure; provided, however, that this Section 8.2 shall
not apply to Company's failure to sell at the time provided shares of
Common Stock to Dow under Section 2.4 or 2.6.
8.3 TERMINATION OF ONE PARTY'S OBLIGATIONS. In lieu of
terminating this Agreement upon a breach by the other party under
Section 8.1(c) or 8.1(d), the party not in breach may notify the other
that, upon expiration of said notice period (subject to
Section 8.2), all rights of the defaulting party hereunder shall
cease but all of the defaulting party's obligations hereunder shall
continue in full force and effect.
ARTICLE IX
REPRESENTATIONS AND WARRANTIES
9.1 OF COMPANY. Company hereby represents and warrants to Dow
as follows:
(a) Company is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware,
with corporate power to own its properties and to conduct its business
as now conducted.
(b) The authorized capital stock of Company consists of (i)
40,000,000 shares of Common Stock, as of April 1, 1994, 19,648,273
shares were validly issued and outstanding, fully paid and
nonassessable and 2,370,229 shares were held in the Company's
treasury, and (ii) 750,000 series preferred shares, no par value, of
which, at the date of this Agreement, no shares were issued and
outstanding, and Series A Preferred Stock is the only series which has
been designated. In addition, as of April 1, 1994, approximately
1,045,774 shares of Common Stock (including authorized but unissued
shares and treasury shares) were reserved for issuance pursuant to
presently existing options under currently existing stock option
plans. There are outstanding no other options, warrants, rights or
convertible securities providing for the issuance of Company capital
stock, except for rights conferred upon Pakhoed pursuant to the
Pakhoed Standstill Agreement.
(c) Company has full legal right, power and authority to
enter into and perform this Agreement, and the execution and delivery
of this Agreement by Company and the consummation of the transactions
contemplated hereby have been duly authorized by the Board and require
no other Board or stockholder action. This Agreement constitutes a
valid and binding agreement of Company. Neither this Agreement nor
the performance of this Agreement by Company or Dow violate Company's
Restated Certificate of Incorporation.
9.2 OF DOW. Dow hereby represents and warrants to Company as
follows: (a) Dow is a corporation duly organized, validly existing and
in good standing under the laws of the state of Delaware, with
corporate power to own its properties and to conduct its business as
now conducted, (b) it has full legal right, power and authority to
enter into and perform this Agreement, and the execution and delivery
of this Agreement by it and the consummation of the transactions
contemplated hereby have been duly authorized by its Board of
Directors and require no other Board of Directors or stockholder
action. This Agreement constitutes a valid and binding agreement of
Dow.
ARTICLE X
MISCELLANEOUS
10.1 SPECIFIC ENFORCEMENT. The parties hereto acknowledge and
agree that each would be irreparably damaged if any of the provisions
of this Agreement are not performed by the other in accordance with
their specific terms or are otherwise breached. It is accordingly
agreed that each party shall be entitled to an injunction
or injunctions to prevent breaches of this Agreement by the other and
to enforce this Agreement and the terms and provisions hereof
specifically against the other in any action instituted in the United
States District Court for the Western District of Washington, in
addition to any other remedy to which such aggrieved party may be
entitled at law or in equity. Company and Dow each consents to
personal jurisdiction in any such action brought in the United States
District Court for the Western District of Washington.
10.2 SEVERABILITY. If any term or provision of this Agreement is
held by a court of competent jurisdiction or other authority to be
invalid, void, unenforceable or against its regulatory policy, the
remainder of the terms, provisions, covenants and restrictions of this
Agreement shall remain in full force and effect and shall in no way be
affected, impaired or invalidated.
10.3 EXPENSES. Except as otherwise provided herein, each party
hereto shall pay its own expenses in connection with this Agreement.
10.4 ASSIGNMENT; SUCCESSORS. This Agreement shall be binding
upon and shall inure to the benefit of and be enforceable by the
successors of the parties hereto. Except as otherwise provided
herein, this Agreement shall not be assignable.
10.5 AMENDMENTS. This Agreement may not be modified, amended,
altered or supplemented except by a written agreement signed by
Company and Dow which shall be authorized by all necessary corporate
action of each party. Any party may waive any condition to the
obligations of any other party hereunder.
10.6 NOTICES. Every notice or other communication required or
contemplated by this Agreement to be given by a party shall be
delivered either by (a) personal delivery, (b) courier mail, or (c)
facsimile addressed to the party for whom intended at the following
address:
To Company: Univar Corporation
6100 Carillon Point
Kirkland, WA 98033
Attention: Corporate Secretary
Facsimile: (206) 889-4136
With a copy to: Preston Gates & Ellis
5000 Columbia Center
701 Fifth Avenue
Seattle, WA 98104-7078
Attention: Richard B. Dodd
Facsimile: (206) 623-7022
To Dow: The Dow Chemical Company
2030 Willard H. Dow Ctr.
Midland, MI 48674
Attn: Director of Mergers and
Acquisitions
Facsimile: (517) 636-1830
With a copy to: The Dow Chemical Company
2030 Willard H. Dow Ctr.
Midland, MI 48674
Attn: General Counsel
Facsimile: (517) 636-0861
or at such other address as the intended recipient previously shall
have designated by written notice to the other parties. Notice by
courier mail shall be effective on the date it is officially recorded
as delivered to the intended recipient by return receipt or
equivalent. All notices and other communications required or
contemplated by this Agreement delivered in person or sent by
facsimile shall be deemed to have been delivered to and received by
the addressee and shall be effective on the date of personal delivery
or on the date sent, respectively. Notice not given in writing shall
be effective only if acknowledged in writing by a duly authorized
representative of the party to whom it was given.
10.7 ATTORNEYS' FEES. If any action or proceeding shall be
commenced to enforce this Agreement or any right arising in connection
with this Agreement, the prevailing party in such action or proceeding
shall be entitled to recover from the other party the reasonable
attorneys' fees, costs and expenses incurred by such prevailing party
in connection with such action or proceeding.
10.8 INTEGRATION. This Agreement contains the entire
understanding of the parties with respect to its subject matter.
There are no restrictions, agreements, promises, warranties, covenants
or undertakings other than those expressly set forth herein with
respect to any matter.
10.9 WAIVERS. No failure or delay on the part of either party
in the exercise of any power, right or privilege hereunder shall
operate as a waiver thereof, nor shall any single or partial exercise
of any such power, right or privilege preclude other or further
exercise thereof or of any other right, power or privilege. All
rights and remedies existing under this Agreement are cumulative to,
and not exclusive of, any rights or remedies otherwise available.
10.10 GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the substantive law of the State of
Washington without giving effect to the principles of conflict of
laws.
10.11 COUNTERPARTS. This Agreement may be executed, in one or
more counterparts, each of which shall be deemed to be an original,
but all of which together shall constitute one and the same
instrument.
10.12 COOPERATION. The parties hereto shall each perform such
acts, execute and deliver such instruments and documents, and do all
such other things as may be reasonably necessary to accomplish the
transactions contemplated in this Agreement.
IN WITNESS WHEREOF, Company and Dow have caused this Agreement to
be executed as of the date first above written.
UNIVAR CORPORATION
BY: /S/ JAMES W. BERNARD
ITS: President And Chief Executive Officer
THE DOW CHEMICAL COMPANY
BY: /S/ ENRIQUE SOSA
ITS: Senior Vice President
EXHIBIT A
LIST OF CORE SHAREHOLDERS NAMES NUMBER OF SHARES OWNED
James W. & Maureen Bernard 186,386*
Richard E. and Gail J. Engebrecht 71,000
Milton M. and Lorraine D. Harris 197,534
Curtis P. & Mary B. Lindley 214,804
N. Stewart & Carol Rogers 303,019
Robert S. & Gloria D. Rogers 237,234
James H. & Ann R. Wiborg 475,011
* Includes stock options exercisable as of April 1, 1994 and
Uni$aver Plan (401(k)) shares as of December 31, 1993.
EXHIBIT 4(ii)
Terms and Conditions of Series A Preferred Stock
CERTIFICATE OF DESIGNATION
OF
SERIES A JUNIOR PARTICIPATING CONVERTIBLE PREFERRED STOCK
OF
UNIVAR CORPORATION
(Pursuant to Section 151 of the
Delaware General Corporation Law)
Univar Corporation, a corporation organized and existing under the
General Corporation Law of the State of Delaware (the "Corporation"),
hereby certifies that the following resolution was adopted by the Board
of Directors of the Corporation as required by Section 151 of the
Delaware General Corporation Law at a meeting duly called and held on
April 13, 1994:
RESOLVED, that pursuant to the authority granted to and
vested in the Board of Directors of this Corporation (the
"Board of Directors" or the "Board") in accordance with the
provisions of the Restated Certificate of Incorporation, as
amended, the Board of Directors hereby creates a series of
Preferred Stock, without par value, of the Corporation and
hereby states the designation and number of shares, and fixes
the relative rights, preferences, and limitations thereof (in
addition to any provisions set forth in the Restated Certificate
of Incorporation of the Corporation, which are applicable to
the Preferred Stock of all classes and series) as follows:
1. DESIGNATION AND AMOUNT. The shares of such series shall
be designated as "Series A Junior Participating Convertible
Preferred Stock" (the "Series A Preferred Stock") and the number of
shares constituting the Series A Preferred Stock shall be 105,000.
Such number of shares may be increased or decreased by resolution
of the Board of Directors; provided, that no decrease shall
reduce the number of shares of Series A Preferred Stock to a number
less than the number of shares then outstanding plus the number of
shares reserved for issuance upon the exercise of any outstanding
options, rights, or warrants.
2. DIVIDENDS AND DISTRIBUTIONS.
2.1 Subject to the prior and superior rights of the
holders of any shares of any series of Preferred Stock or any
similar stock ranking prior and superior to the Series A Preferred
Stock with respect to dividends, the holders of shares of Series A
Preferred Stock, in preference to the holders of any stock ranking
junior to the Series A Preferred Stock but on a parity with the
holders of Common Stock, $0.33-1/3 par value (the "Common Stock"),
shall be entitled to receive, when, as and if paid by the
Corporation out of funds legally available for the purpose,
dividends or other distributions equal to five (5) times the
aggregate per share amount of all dividends or other distributions
paid with respect to the Common Stock of the Corporation, other
than a dividend payable in shares of Common Stock or a subdivision
of the outstanding shares of Common Stock (by reclassification or
otherwise). In the event the Corporation shall at any time declare
or pay any dividend on the Common Stock payable in shares of
Common Stock, or effect a subdivision or combination or consolidation
of the outstanding shares of Common Stock (by reclassification or
otherwise) into a greater or lesser number of shares of Common
Stock, then in each such case the amount of such dividend or
distribution to which holders of shares of Series A Preferred Stock
were entitled immediately prior to such event under the preceding
sentence shall be adjusted by multiplying such amount by a fraction,
the numerator of which is the number of shares of Common Stock
outstanding immediately after such event and the denominator of
which is the number of shares of Common Stock that were outstanding
immediately prior to such event.
2.2 The Corporation shall declare a dividend or
distribution on the Series A Preferred Stock as provided in
subsection 2.1 of this Section at the same time it declares a dividend
or distribution on the Common Stock (other than a dividend payable in
shares of Common Stock).
2.3 The Board of Directors may fix a record date for
the determination of holders of shares of Series A Preferred Stock
entitled to receive payment of a dividend or distribution declared
thereon, which record date shall be not more than 60 days prior to
the date fixed for the payment thereof.
3. VOTING. The shares of Series A Preferred Stock shall not
have any voting powers, either general or special, except that the
consent of the holders of at least a majority of all of the shares
of Series A Preferred Stock at the time outstanding, given in person
or by proxy, shall be necessary for authorizing, effecting or
validating the amendment, alteration or repeal of any of the
provisions of the Restated Certificate of Incorporation or of any
certificate amendatory thereof or supplemental thereto (including
any Certificate of Designation or any similar document relating to
any series of Preferred Stock) so as to affect adversely the powers,
preferences, or rights, of Series A Preferred Stock. An increase of
the authorized amount of Common Stock or the Preferred Stock, or the
creation or authorization of any shares of any other class of stock
of the Corporation ranking prior to or on a parity with the shares
of Series A Preferred Stock as to dividends or upon liquidation,
dissolution, or winding up, or the reclassification of any authorized
stock of the Corporation into any such prior or parity shares, or
the creation or authorization of any obligation or security
convertible into or evidencing the right to purchase any such prior
or parity shares shall not be deemed to affect adversely the powers,
preferences, or rights of Series A Preferred Stock.
4. CERTAIN RESTRICTIONS. Whenever dividends or distributions
payable on the Series A Preferred Stock as provided in Section 2 are
in arrears, thereafter and until all accrued and unpaid dividends and
distributions, whether or not declared, on shares of Series A
Preferred Stock outstanding shall have been paid in full, the
Corporation shall not:
4.1 declare or pay any dividends, or make any other
distributions, on any shares of stock ranking junior (either as
to dividends or upon liquidation, dissolution, or winding up) to the
Series A Preferred Stock;
4.2 declare or pay dividends, or make any other
distributions, on any shares of stock ranking on a parity (either as
to dividends or upon liquidation, dissolution, or winding up) with
the Series A Preferred Stock except dividends paid ratably on the
Series A Preferred Stock and all such parity stock on which dividends
are payable or in arrears in proportion to the total amounts to which
the holders of all such shares are then entitled; or
4.3 redeem or purchase or otherwise acquire for
consideration shares of any stock ranking junior (either as to
dividends or upon liquidation, dissolution, or winding up) to the
Series A Preferred Stock, provided that the Corporation may at any
time redeem, purchase or otherwise acquire shares of any such
junior stock in exchange for shares of any stock of the Corporation
ranking junior (either as to dividends or upon dissolution,
liquidation or winding up) to the Series A Preferred Stock.
5. CONVERSION. Each share of the Series A Preferred Stock may
be converted at any time, at the option of the holder thereof, into
shares of Common Stock of the Corporation, on the terms and
conditions set forth below in this Section 5. Further, each share
of the Series A Preferred Stock may be converted at any time after
the expiration of three years from the date of issuance of the
Series A Preferred Stock, at the option of the Corporation, into
shares of Common Stock of the Corporation, on the terms and
conditions set forth below in this Section 5.
5.1 Subject to the provisions for adjustment hereinafter
set forth, each share of the Series A Preferred Stock shall be
convertible at the option of the holder thereof, or, as set forth
in the preceding paragraph, at the option of the Corporation, in
the manner hereinafter set forth, into five (5) fully paid and non
assessable shares of Common Stock of the Corporation;
5.2 The number of shares of Common Stock into which
each share of the Series A Preferred Stock is convertible as set
forth in subsection 5.1 shall be adjusted from time to time as follows:
5.2.1 In case the Corporation shall at any time or
from time to time declare or pay any dividend on its Common Stock
payable in its Common Stock or effect a subdivision of the outstanding
shares of its Common Stock into a greater number of shares of Common
Stock (by reclassification or otherwise than payment of a dividend
in its Common Stock), then, and in each such case, the number of
shares of Common Stock into which each share of the Series A
Preferred Stock is convertible shall be adjusted so that the holder
of each share thereof shall be entitled to receive, upon the
conversion thereof, the number of shares of Common Stock determined
by multiplying (a) the number of shares of Common Stock into which
such share was convertible immediately prior to the occurrence of
such event by (b) a fraction, the numerator of which is the sum of
(I) the number of shares of Common Stock into which such shares
was convertible immediately prior to the occurrence of such event
plus (II) the number of shares of Common Stock which such holder
would have been entitled to receive in connection with the occurrence
of such event had such share been converted immediately prior thereto,
and the denominator of which is the number of shares of Common Stock
into which such shares was convertible immediately prior to the
occurrence of such event. An adjustment made pursuant to this
subsection 5.2.1 shall become effective (a) in the case of any such
dividend, immediately after the close of business on the record date
for the determination of holders of Common Stock entitled to receive
such dividend, or (b) in the case of any such subdivision, at the
close of business on the day immediately prior to the day upon which
such corporate action becomes effective;
5.2.2 In case the Corporation at any time or from
time to time shall combine or consolidate the outstanding shares
of its Common Stock into a lesser number of shares of Common Stock,
by reclassification or otherwise, then, and in each such case, the
number of shares of Common Stock into which each share of the Series A
Preferred Stock is convertible shall be adjusted so that the holder
of each share thereof shall be entitled to receive, upon the
conversion thereof, the number of shares of Common Stock determined
by multiplying (a) the number of shares of Common Stock into which
such share was convertible immediately prior to the occurrence of
such event by (b) a fraction, the numerator of which is the number
of shares which the holder would have owned after giving effect to
such event had such share been converted immediately prior to the
occurrence of such event and the denominator of which is the number
of Common Shares into which such share was convertible immediately
prior to the occurrence of such event. An adjustment made pursuant
to this subsection 5.2.2 shall become effective at the close of
business on the day immediately prior to the day upon which such
corporate action becomes effective; and
5.2.3 In case the Corporation at any time or from
time to time shall issue rights or warrants to all holders of shares
of its Common Stock entitling them (for a period expiring within 45
calendar days after the date of issuance) to subscribe for or purchase
shares of its Common Stock (or securities convertible into its Common
Stock) at a price per share (or having a conversion price per share)
less than the Current Market Price (as defined in subsection 5.3
below) per share of Common Stock on the record date fixed for the
determination of shareholders entitled to receive such right or warrant,
then, and in each such case (unless the holders of shares of the
Series A Preferred Stock shall be permitted to subscribe for or
purchase shares of Common Stock on the same basis as though such
shares of the Series A Preferred Stock had been converted into
shares of Common Stock immediately prior to the close of business on
such record date), the number of shares of Common Stock into which
each share of the Series A Preferred Stock is convertible shall be
adjusted so that the holder of each share thereof shall be entitled
to receive, upon the conversion thereof, the number of shares of
Common Stock determined by multiplying (a) the number of shares of
Common Stock into which such share was convertible immediately prior
to such event by (b) a fraction, the numerator of which shall be the
sum of (I) the number of shares of Common Stock outstanding on such
record date plus (II) the number of additional shares of Common Stock
offered for subscription or purchase, and the denominator of which
shall be the sum of (I) the number of shares of Common Stock
outstanding on such record date plus (II) the number of shares of
Common Stock which the aggregate consideration receivable by the
Corporation for the total number of shares of Common Stock so
offered would purchase at such Current Market Price on such record
date. For purposes of this subsection 5.2.3, the aggregate
consideration receivable by the Corporation in connection with the
issuance of rights or warrants to subscribe for or purchase securities
convertible into Common Stock shall be deemed to be equal to the
sum of the aggregate offering price of such securities plus the
minimum aggregate amount, if any, payable upon conversion of such
securities into shares of Common Stock. An adjustment made pursuant
to this subsection 5.2.3 shall be made upon the issuance of any such
rights or warrants and shall be effective retroactively immediately
after the close of business as of the record date fixed for the
determination of shareholders entitled to receive such rights or
warrants. For purposes of this subsection 5.2.3, the granting of
the right to purchase Common Stock (whether treasury shares or newly
issued shares) pursuant to any plan providing for the reinvestment
of dividends or interest payable on securities of the Corporation,
and the investment of additional optional amounts, in shares of
Common Stock, in any such case at a price per share of not less than
95% of the current market price (determined as provided in such
plans) per share of Common Stock, shall not be deemed to constitute
an issue of rights or warrants by the Corporation within the meaning
of this subsection).
5.3 The term "Current Market Price" shall mean, as applied
to any class of stock on any date, the average of the daily "Closing
Prices" (as hereinafter defined) for the twenty (20) consecutive
"Trading Days" (as hereinafter defined) immediately prior to the
date in question; provided, however, that in the event that the
Current Market Price per share of Common Stock is determined during
a period following the announcement by the Corporation of a dividend
or distribution on its Common Stock payable in shares of its Common
Stock or securities convertible into shares of its Common Stock, and
prior to the expiration of thirty Trading Days after the ex-dividend
date for such dividend or distribution, then, and in each such case,
the Current Market Price shall be appropriately adjusted to reflect
the Current Market Price per Common Stock equivalent. The term
"Closing Price" on any day shall mean the last sales price, regular
way, per share of such stock on such day, or, if no such sale takes
place on such day, the average of the closing bid and asked prices,
regular way, as reported in the principal consolidated transaction
reporting system with respect to securities listed or admitted to
trading on the New York Stock Exchange or, if shares of such stock
are not listed or admitted to trading on the New York Stock Exchange,
as reported in the principal consolidated transaction reporting
system with respect to securities listed on the principal national
securities exchange on which the shares of such stock are listed or
admitted to trading or, if the shares of such stock are not listed
or admitted to trading on any national securities exchange, as
reported by the National Association of Securities Dealers Inc.'s
Automated Quotation System. The term "Trading Day" shall mean a day
on which the principal national securities exchange on which shares
of such stock are listed or admitted to trading is open for the
transaction of business or, if the shares of such stock are not
listed or Thursday or Friday on which banking institutions in the
Borough of Manhattan, City and State of New York, are not authorized
or obligated by law or executive order to close;
5.4 The holder of any shares of the Series A Preferred
Stock may exercise his option to convert such shares into shares
of Common Stock by surrendering for such purpose to the Corporation,
at its principal office or at such other office or agency maintained
by the Corporation for that purpose, a certificate or certificates
representing the shares of Series A Preferred Stock to be converted
accompanied by a written notice stating that such holder elects to
convert all or a specified whole number of such shares in accordance
with the provisions of this Section 5. Such notice shall be
accompanied by payment of all transfer taxes payable upon the
issuance of shares of Common Stock, provided that in no event shall
a certificate of Common Stock be issued in contravention of Section 6
or any agreement between the Corporation and the holder. As promptly
as practicable, and in any event within five business days after the
surrender of such certificates and the receipt of such notice
relating thereto and, if applicable, payment of all transfer taxes,
the Corporation shall deliver or cause to be delivered (i) certificates
representing the number of validly issued, fully paid and non
assessable shares of Common Stock of the Corporation to which the
holder of the Series A Preferred Stock so converted shall be entitled
and (ii) if less than the full number of shares of the Series A
Preferred Stock evidenced by the surrendered certificate or
certificates are being converted, a new certificate or certificates,
of like tenor, for the number of shares evidenced by such surrendered
certificate or certificates less the number of shares converted.
Such conversions shall be deemed to have been made at the close of
business on the date of giving of such notice and of such surrender
of the certificate or certificates representing the shares of the
Series A Preferred Stock to be converted so that the rights of the
holder thereof shall cease except for the right to receive Common
Stock of the Corporation in accordance herewith, and the converting
holder shall be treated for all purposes as having become the record
holder of such Common Stock of the Corporation at such time;
5.5 Upon conversion of any shares of the Series A Preferred
Stock, the holder thereof, after such conversion, shall not be
entitled to receive any accumulated, accrued or unpaid dividends in
respect of the shares so converted, provided that such holder shall
be entitled to receive any dividends on such shares of the Series A
Preferred Stock declared prior to such conversion if such holder held
such shares on the record date fixed for the determination of holders
of the Series A Preferred Stock entitled to receive payment of such
dividend;
5.6 In connection with the conversion of any shares of
the Series A Preferred Stock, no fractions of shares of Common Stock
shall be issued, but the Corporation shall pay a cash adjustment in
respect of such fractional interest in an amount equal to the market
value of such fractional interest. In such event, the market value
of a share of Common Stock of the Corporation shall be the Closing
Price (as defined in section 5.3) of such shares on the last business
day on which such shares were traded immediately preceding the date
upon which such shares of Series A Stock are deemed to have been
converted; and
5.7 The Corporation shall at all times reserve and keep
available out of its authorized Common Stock the full number of shares
of Common Stock of the Corporation issuable upon the conversion of all
outstanding shares of the Series A Preferred Stock.
6. RESTRICTIONS ON TRANSFER. NO SHARES OF SERIES A PREFERRED
STOCK SHALL BE SOLD, ASSIGNED, ALIENATED, PLEDGED, HYPOTHECATED,
TRANSFERRED OR OTHERWISE DISPOSED OF WITHOUT THE EXPRESS WRITTEN
CONSENT OF THE CORPORATION. THE HOLDER, IN ACCEPTING SHARES OF
SERIES A PREFERRED STOCK, ACKNOWLEDGES THAT CONVERSION PURSUANT TO
SECTION 5 IS A PREREQUISITE TO ANY TRANSFER OF ANY BENEFICIAL
INTEREST IN SUCH SHARES. EACH CERTIFICATE OF SERIES A PREFERRED
STOCK SHALL BEAR A LEGEND SETTING FORTH THIS RESTRICTION.
7. REACQUIRED SHARES. Any shares of Series A Preferred Stock
purchased or otherwise acquired by the Corporation in any manner
whatsoever shall be retired and canceled promptly after the
acquisition thereof. The Corporation shall cause all such shares
upon their cancellation to become authorized but unissued shares of
Preferred Stock which may be reissued as part of a new series of
Preferred Stock subject to the conditions and restrictions on issuance
set forth herein, in the Restated Certificate of Incorporation, in
any other Certificate of Designation establishing a series of
Preferred Stock or any similar stock, or as otherwise required by
law.
8. LIQUIDATION, DISSOLUTION, OR WINDING UP. Upon any
liquidation, dissolution, or winding up of the Corporation, the
Series A Preferred Shares shall not be entitled to any preference
over the Company's Common Stock with respect to distributions of
the assets of the Company.
9. CONSOLIDATION, MERGER, ETC. In case the Corporation shall
enter into any consolidation, merger, combination, or other
transaction in which the shares of Common Stock are exchanged for or
changed into other stock or securities, cash and/or any other
property payable in kind, then in any such case, each share of
Series A Preferred Stock shall at the same time be similarly
exchanged or changed into an amount per share, subject to the
provision for adjustment hereinafter set forth, equal to five (5)
times the aggregate amount of stock, securities, cash, and/or any
other property (payable in kind), as the case may be, into which or
for which each share of Common Stock is changed or exchanged. In the
event the Corporation shall at any time declare or pay any dividend
on the Common Stock payable in shares of Common Stock, or effect a
subdivision or combination or consolidation of the outstanding
shares of Common Stock (by reclassification or otherwise than by
payment of a dividend in shares of Common Stock) into a greater or
lesser number of shares of Common Stock, then in each such case the
amount set forth in the preceding sentence with respect to the
exchange or change of shares of Series A Preferred Stock shall be
adjusted by multiplying such amount by a fraction, the numerator of
which is the number of shares of Common Stock outstanding immediately
after such event and the denominator of which is the number of shares
of Common Stock that were outstanding immediately prior to such event.
10. REDEMPTION. The shares of Series A Preferred Stock may
be redeemed in whole or in part by the Corporation at any time
after issuance for an amount equal to the issue price, plus any
accrued and unpaid dividends.
11. RANK. The Series A Preferred Stock shall rank junior
with respect to the payment of dividends and the distribution of
assets to all series of the Corporation's Preferred Stock or any
similar stock that specifically provide that they shall rank prior to
the Series A Preferred Stock. Nothing herein shall preclude the Board
from creating any series of Preferred Stock or any similar stock
ranking on a parity with or prior to the Series A Preferred Stock as
to the payment of dividends or the distribution of assets upon
liquidation, dissolution, or winding up.
IN WITNESS WHEREOF, the Corporation has caused this Certificate to
be executed in its name by the undersigned, thereunto duly authorized,
this 13th day of April, 1994.
UNIVAR CORPORATION
By: /S/ James W. Bernard
Title: President
ATTEST:
/s/ William A. Butler
Corporate Secretary
