VOTING AGREEMENT
THIS VOTING AGREEMENT is made and effective as of December 6, 1996, by and
among KEYSTONE AUTOMOTIVE INDUSTRIES, INC., a California corporation
("Keystone"), NORTH STAR PLATING COMPANY, a Minnesota corporation ("North
Star"), VIRGIL K. BENTON II, CHARLES J. HOGARTY, AL A. RONCO, ROBERT L. BLANTON
and JOHN M. PALUMBO (collectively, the "Shareholders" and individually, a
"Shareholder") and RONALD G. BROWN ("Brown").
A. Keystone and the Shareholders desire that Keystone, North Star Merger,
Inc., a wholly owned subsidiary of Keystone (the "Subsidiary"), North Star and
certain shareholders of North Star (the "North Star Shareholders") enter into
that certain Agreement and Plan of Merger (as the same may be amended or
supplemented, the "Merger Agreement"), pursuant to which, among other things,
(i) the Subsidiary will be merged with and into North Star (the "Merger"), (ii)
all shares of the capital stock of North Star issued and outstanding immediately
prior to the Merger will be converted into the right to receive an aggregate of
2,450,000 shares of the Common Stock of Keystone (or approximately 25.1% of the
shares of the Common Stock of Keystone to be issued and outstanding immediately
after the Merger) and (iii) Ronald G. Brown, a director, officer and principal
shareholder of North Star, will become a director of Keystone.
B. Keystone and the Shareholders are entering into this Agreement as a
material inducement to North Star and the North Star Shareholders to enter into
the Merger Agreement.
C. Each Shareholder is an executive officer, director or principal
shareholder of Keystone.
NOW, THEREFORE, in consideration of the premises and of the respective
representations, warranties, covenants, agreements and conditions contained
herein and in the Merger Agreement, and intending to be legally bound hereby,
the parties agree as follows:
1. REPRESENTATIONS AND WARRANTIES. Each Shareholder hereby represents
and warrants to Keystone as follows:
(a) The Shareholder is the holder of record, and has the sole power
to vote, or to direct the voting of, and to dispose of, or to direct the
disposition of, that number of shares of the Common Stock of Keystone set forth
opposite such Shareholder's name on SCHEDULE A hereto, except as otherwise
expressly set forth on such schedule.
(b) The Shareholder has the legal right, power, capacity and
authority to execute, deliver and perform this Agreement without obtaining the
approval or consent of any
EXHIBIT 10.37
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person, and this Agreement is the legal, valid and binding obligation of the
Shareholder and is enforceable against the Shareholder in accordance with its
terms.
(c) Neither the execution and delivery of this Agreement nor the
consummation by the Shareholder of the transactions contemplated hereby (i) will
result in a violation of, constitute a default under, conflict with or require
any consent, approval or notice under, any contract, trust, commitment,
agreement, understanding, arrangement or restriction of any kind, or any
judgment, order, decree, statute, law, rule or regulation, to which the
Shareholder is a party or by which the Shareholder is bound or (ii) will result
in the creation or imposition of any lien, claim, charge, security interest,
encumbrance or restriction on any shares of the capital stock of Keystone. If
the Shareholder is married and any shares of the capital stock of Keystone held
by the Shareholder constitute community property, this Agreement has been duly
executed and delivered by, and constitutes the legal, valid and binding
agreement of, the Shareholder's spouse, enforceable against such person in
accordance with its terms.
(d) No broker, investment banker, financial adviser or other person
is entitled to any broker's, finder's, financial adviser's or other similar fee
or commission in connection with the transactions contemplated hereby or by the
Merger Agreement based upon arrangements made by or on behalf of the
Shareholder.
(e) The Shareholder understands and acknowledges that North Star and
the North Star Shareholders are entering into the Merger Agreement in reliance
upon the Shareholder's execution and delivery of this Agreement. The
Shareholder acknowledges that the irrevocable proxy set forth in Section 4 is
granted in consideration for the execution and delivery of the Merger Agreement
by North Star and the North Star Shareholders.
2. VOTING OF KEYSTONE SHARES. Each Shareholder hereby covenants and
agrees as follows:
(a) At any meeting of shareholders of Keystone called to vote upon
the Merger Agreement, the Merger or the other transactions contemplated by the
Merger Agreement, or at any adjournment thereof, or in any other circumstances
in which a vote, consent or other approval with respect to the Merger Agreement,
the Merger or the other transactions contemplated by the Merger Agreement is
sought, the Shareholder shall vote (or cause to be voted) all shares of the
capital stock of Keystone as to which he has the sole or shared voting power, as
of the record date established to determine the persons who have the right to
vote at such meeting or to grant such vote, consent or approval, in favor of the
Merger, the execution and delivery by Keystone of the Merger Agreement and the
approval of the terms of the Merger Agreement, the Merger and each other
transaction contemplated by the Merger Agreement.
(b) At any meeting of shareholders of Keystone, or at any adjournment
thereof, or in any other circumstances in which the vote, consent or other
approval of shareholders of Keystone is sought, the Shareholder shall vote (or
cause to be voted) all shares of the capital stock
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of Keystone as to which he has the sole or shared voting power as of the record
date established to determine the persons who have the right to vote at such
meeting or to grant such vote, consent or the approval against any proposal or
transaction involving Keystone, which proposal or transaction would in any
manner impede, frustrate, prevent or nullify the Merger, the Merger Agreement or
any of the other transactions contemplated by the Merger Agreement (a "Competing
Transaction").
(c) The Shareholder shall retain at all times the right to vote any
shares of the capital stock of North Star, in his sole discretion, on all
matters (other than those set forth in this Section 2) which are at any time or
from time to time presented to the shareholders of Keystone generally.
(d) The Shareholder shall not, without the prior written consent of
North Star in each instance, take any action that would alter or affect in any
way the right to vote any shares of the capital stock of Keystone as to which
the Shareholder has the sole or shared voting power, including, but not limited
to, (i) transferring (whether by sale, gift, pledge or otherwise), or consenting
to the transfer of, any interest in any such shares, (ii) entering into any
contract, option or other agreement or understanding with respect to the voting
of such shares, (iii) granting any proxy, power of attorney or other
authorization in or with respect to the voting of such shares or (iv) depositing
such shares into a voting trust or entering into a voting agreement or
arrangement with respect thereto.
(e) At any meeting of shareholders of Keystone called to elect
directors of Keystone, or at any adjournment thereof, or in any other
circumstances in which a vote with respect to the election of directors is
sought, the Shareholder shall vote (or cause to be voted) all shares of the
capital stock of Keystone as to which he has the sole or shared voting power, as
of the date established to determine the persons who have the right to vote at
such meeting, in favor of the election of Ronald G. Brown as a director of
Keystone.
3. RECOMMENDATIONS TO SHAREHOLDERS. Each Shareholder, who is a director
of Keystone, in his capacity as a director, (i) shall recommend to the
shareholders of Keystone that they approve the Merger Agreement, the Merger and
the transactions contemplated by the Merger Agreement at the Keystone Meeting or
at any other meeting of the shareholders of Keystone, or in any other
circumstances in which the vote, consent or approval of shareholders of Keystone
is sought with respect thereto, and (ii) shall advise the shareholders of
Keystone to reject any Competing Transaction; PROVIDED, however, that a
Shareholder shall not be obligated to take any action specified in clause (ii)
if the Board of Directors of Keystone is advised in writing by Manatt, Phelps &
Phillips, LLP (or such other counsel as is reasonably acceptable to North Star)
that such action would conflict with the proper discharge of his fiduciary
duties under applicable law.
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4. GRANT OF IRREVOCABLE PROXY.
(a) Each Shareholder hereby irrevocably grants to, and appoints,
North Star and Ronald G. Brown, the President of North Star, and Kim D. Wood, a
Vice President of North Star, in their respective capacities as officers of
North Star, and any individual who hereafter shall succeed to any such office of
North Star, and each of them individually, the Shareholder's proxy and
attorney-in-fact (with full power of substitution), for and in the name, place
and stead of the Shareholder to vote all shares of the capital stock of Keystone
as to which the Shareholder has the sole or shared voting power, or to grant a
consent or approval in respect of such shares, (i) in favor of the Merger, the
execution and delivery of the Merger Agreement and the approval of the terms
thereof and of each other transaction contemplated by the Merger Agreement and
(ii) against any Competing Transaction.
(b) Each Shareholder hereby represents that any proxies heretofore
given in respect of any shares of the capital stock of Keystone are not
irrevocable, and that any such proxies hereby are revoked.
(c) Each Shareholder hereby affirms that the irrevocable proxy set
forth in this Section 4 is given in connection with the execution of the Merger
Agreement, and that such irrevocable proxy is given to secure the performance of
the duties of the Shareholder under this Agreement. Each Shareholder hereby
further affirms that the irrevocable proxy is coupled with an interest and may
under no circumstances be revoked. Each Shareholder hereby ratifies and
confirms all that such irrevocable proxy may lawfully do or cause to be done by
virtue hereof.
5. LEGEND. Each Shareholder shall stamp, print or type, or shall cause
to be stamped, printed or typed, the following legend on the face of any
certificate evidencing shares of the Common Stock or other securities of
Keystone held by such Shareholder:
"THE VOTING OF THE SECURITIES REPRESENTED BY THIS
CERTIFICATE IS SUBJECT TO A VOTING AGREEMENT DATED AS OF DECEMBER
6, 1996, A COPY OF WHICH IS ON FILE AT THE OFFICES OF THE
COMPANY."
6. TERMINATION. All rights and obligations of the parties under this
Agreement shall terminate upon the date upon which the Merger Agreement is
terminated in accordance with Section 9.1 thereof.
7. SUCCESSORS AND ASSIGNS. Neither this Agreement nor any of the rights
or duties hereunder shall be assigned, in whole or in part, by operation of law
or otherwise, by any of the parties without the prior written consent of each
other party. Any assignment in violation of the foregoing shall be void. This
Agreement and the obligations of a Shareholder hereunder shall attach to all
shares of the capital stock of Keystone now held or hereafter acquired by such
Shareholder and, except for the obligations set forth in Section 2(e), shall
inure to the benefit of
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and shall be binding upon any person to which legal or beneficial ownership of
such shares shall pass, whether by operation of law or otherwise, including, but
not limited to, the Shareholder's permitted heirs, representatives, successors
or assigns. In the event of any stock split, stock dividend, merger,
reorganization, recapitalization or other change in the capital structure of
Keystone, or the acquisition of any interest in additional shares of the capital
stock of Keystone by any Shareholder, the number of shares subject to the terms
of this Agreement shall be adjusted appropriately and this Agreement and the
obligations hereunder shall attach to any interest in any additional shares of
the capital stock of Keystone issued to or acquired by such Shareholder.
8. INDEMNIFICATION.
(a) Each party hereto shall indemnify each other party hereto and
hold it harmless against and in respect of any and all payments, damages,
demands, claims, losses, expenses, costs, obligations and liabilities
(including, but not limited to, reasonable attorneys' fees and costs) which
arise or result from or are related to any breach by such indemnifying party or
failure by such indemnifying party to perform any of its representations,
warranties, commitments, obligations, covenants or conditions hereunder.
Consummation of the transactions contemplated hereby shall not be deemed or
construed to be a waiver of any right or remedy of the indemnified party nor
shall this section or any other provision of this Agreement be deemed or
construed to be a waiver of any ground of defense by the indemnified party.
(b) The party indemnified hereunder (the "Indemnitee") shall promptly
notify the indemnifying party (the "Indemnitor") of the existence of any claim,
demand or other matter involving liabilities to third parties to which the
Indemnitor's indemnification obligations would apply and shall give the
Indemnitor a reasonable opportunity to defend the same at its own expense and
with counsel of its own selection (who shall be approved by the Indemnitee,
which approval shall not be unreasonably withheld); PROVIDED, however, that the
Indemnitee at all times also shall have the right to fully participate in the
defense at its own expense. If the Indemnitor within a reasonable time after
such notice fails to defend such claim, or fails to pursue such defense
vigorously once commenced, the Indemnitee shall have the right, but not the
obligation, to undertake the defense of, and to compromise or settle (exercising
reasonable business judgment), the claim or other matter on behalf, for the
account and at the risk and expense of the Indemnitor. Except as provided in
the preceding sentence, the Indemnitee shall not compromise or settle the claim
or other matter without the prior written consent of the Indemnitor in each
instance. If the claim is one that cannot by its nature be defended solely by
the Indemnitor, the Indemnitee shall make available all information and
assistance that the Indemnitor reasonably may request; PROVIDED, however, that
any associated expenses shall be paid by the Indemnitor.
9. SURVIVAL OF REPRESENTATIONS, WARRANTIES AND AGREEMENTS. All
representations, warranties and agreements made by the parties hereto in this
Agreement (including, but not limited to, statements contained in any schedule
or certificate or other instrument delivered by or on behalf of any party hereto
or in connection with the transactions contemplated hereby) shall
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survive the date hereof and any investigations, inspections, examinations or
audits made by or on behalf of any party.
10. ENTIRE AGREEMENT. This Agreement constitutes the entire agreement
between the parties hereto pertaining to the subject matter hereof, and
supersedes all prior agreements, understandings, negotiations and discussions,
whether oral or written, relating to the subject matter of this Agreement. No
supplement, modification, waiver or termination of this Agreement shall be valid
unless executed by the party to be bound thereby. No waiver of any of the
provisions of this Agreement shall be deemed or shall constitute a waiver of any
other provisions hereof (whether or not similar), nor shall such waiver
constitute a continuing waiver unless otherwise expressly provided.
11. NOTICES. Any notice or other communication required or permitted
hereunder shall be in writing and shall be deemed to have been given (i) if
personally delivered, when so delivered, (ii) if mailed, one (1) week after
having been placed in the mail, registered or certified, postage prepaid,
addressed to the party to whom it is directed at the address set forth on the
signature page hereof or (iii) if given by telex or telecopier, when such notice
or other communication is transmitted to the telex or telecopier number
specified on the signature page hereof and the appropriate answer back or
telephonic confirmation is received. Any party may change the address to which
such notices are to be addressed by giving the other parties notice in the
manner herein set forth.
12. GOVERNING LAW. The validity, construction and interpretation of this
Agreement shall be governed in all respects by the laws of the State of
California applicable to contracts made and to be performed wholly within that
State.
13. HEADINGS. Section and subsection headings are not to be considered
part of this Agreement and are included solely for convenience and reference and
in no way define, limit or describe the scope of this Agreement or the intent of
any provisions hereof.
14. ATTORNEYS' FEES. In the event any party takes legal action to enforce
any of the terms of this Agreement, the unsuccessful party to such action shall
pay the successful party's expenses (including, but not limited to, attorneys'
fees and costs) incurred in such action.
15. THIRD PARTIES. Nothing in this Agreement, expressed or implied, is
intended to confer upon any person other than the parties hereto and their
successors and assigns any rights or remedies under or by reason of this
Agreement.
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16. INJUNCTIVE RELIEF. Keystone and the Shareholders each hereby
acknowledge and agree that the obligations of the Shareholders hereunder are
unique and North Star would not have an adequate remedy at law for money damages
in the event of the breach or threatened breach of any provision of this
Agreement. Accordingly, North Star shall be entitled to temporary and
injunctive relief, including temporary restraining orders, preliminary
injunctions and permanent injunctions, to enforce such provisions without the
necessity of proving actual damages or being required to post any bond or
undertaking in connection with any such action. This provision with respect to
injunctive relief shall not diminish, however, the right of North Star to any
other relief or to claim and recover damages.
17. COUNTERPARTS. This Agreement may be executed simultaneously in two or
more counterparts, each one of which shall be deemed an original, but all of
which shall constitute one and the same instrument.
18. FURTHER ASSURANCES. Each party hereto shall, from time to time at and
after the date hereof, execute and deliver such instruments, documents and
assurances and take such further actions as the other party may reasonably
request to carry out the purpose and intent of this Agreement.
19. JURISDICTION.
(a) Each party hereto irrevocably submits to the non-exclusive
jurisdiction of any court of the State of California or the United States of
America sitting in the City of Los Angeles over any suit, action or proceeding
arising out of or relating to this Agreement. To the fullest extent it may
effectively do so under applicable law, each party irrevocably waives and agrees
not to assert, by way of motion, as a defense or otherwise, any claim that it is
not subject to the jurisdiction of any such court, any objection that it may now
or hereafter have to the establishment of the venue of any such suit, action or
proceeding brought in any such court and any claim that any such suit, action or
proceeding brought in any such court has been brought in an inconvenient forum.
(b) Each party hereto agrees, to the fullest extent it may
effectively do so under applicable law, that a judgment in any suit, action or
proceeding of the nature referred to hereinabove brought in any such court shall
be conclusive and binding upon such person and its successors and assigns and
may be enforced in the courts of the United States of America or the State of
California (or any other courts to the jurisdiction of which such person is or
may be subject) by a suit upon such judgment.
(c) Each party hereto consents to process being served in any suit,
action or proceeding of the nature referred to hereinabove by mailing a copy
thereof by registered or certified mail, postage prepaid, return receipt
requested, to the address of the other set forth in Section 11. Each party
agrees that such service (i) shall be deemed in every respect effective service
of process upon such person in any such suit, action or proceeding and (ii)
shall, to the
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fullest extent permitted by law, be taken and held to be valid personal service
upon and personal delivery to such person.
20. DEFINED TERMS. Capitalized terms used and not otherwise defined in
this Agreement shall have the respective meanings assigned to them in the Merger
Agreement.
21. SEVERABLE PROVISIONS. If any term, provision, covenant or restriction
herein, or the application thereof to any circumstance, shall, to any extent, be
held by a court of competent jurisdiction to be invalid, void or unenforceable,
the remainder of the terms, provisions, covenants and restrictions herein and
the application thereof to any other circumstances, shall remain in full force
and effect, shall not in any way be affected, impaired or invalidated, and shall
be enforced to the fullest extent permitted by law.
IN WITNESS WHEREOF, the undersigned parties have executed and delivered
this Agreement as of the day and year first above written.
KEYSTONE: KEYSTONE AUTOMOTIVE INDUSTRIES, INC.
By \s\ Charles J. Hogarty
------------------------------------------------
Charles J. Hogarty, Chief Operating Officer
700 East Bonita Avenue
Pomona, California 91767
NORTH STAR: NORTH STAR PLATING COMPANY
By \s\ Ronald G. Brown
------------------------------------------------
Ronald G. Brown, President
3621 Marshall Street, N.E.
Minneapolis, Minnesota 55418
SHAREHOLDERS:
\s\ Virgil K. Benton II
--------------------------------------------------
VIRGIL K. BENTON II
\s\ Robert L. Blanton
--------------------------------------------------
ROBERT L. BLANTON
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\s\ Charles J. Hogarty
--------------------------------------------------
CHARLES J. HOGARTY
\s\ John M. Palumbo
--------------------------------------------------
JOHN M. PALUMBO
\s\ Al A. Ronco
--------------------------------------------------
AL A. RONCO
BROWN: \s\ Ronald G. Brown
--------------------------------------------------
RONALD G. BROWN
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SPOUSAL CONSENT
I am the spouse of __________________, a Shareholder in the above
Agreement. I understand that I may consult independent legal counsel as to the
effect of this Agreement and the consequences of my execution of this Agreement
and, to the extent I felt it necessary, I have discussed it with legal counsel.
I hereby confirm this Agreement and agree that it shall bind my interest in the
Shares, if any.
-------------------------------
(Print Name)
-------------------------------
(Signature)
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