EXHIBIT 4.2
VOTING AGREEMENT
VOTING AGREEMENT, dated as of June 24, 1999, among RSJ Acquisition
Co., a Delaware corporation ("Merger Co."), and the individuals and other
parties listed on Schedule A attached hereto (each a "Stockholder" and,
collectively, the "Stockholders").
WHEREAS, concurrently herewith Merger Co. and Citation Corporation, a
Delaware corporation (the "Company"), are entering into an Agreement and Plan of
Merger and Recapitalization of even date herewith (as such agreement may be
amended from time to time, the "Merger Agreement"; capitalized terms used but
not otherwise defined herein shall have the respective meanings ascribed to them
in the Merger Agreement) pursuant to which Merger Co. will be merged with and
into the Company (the "Merger"); and
WHEREAS, Merger Co. has required, as a condition to its entering into
the Merger Agreement, that each Stockholder enter into, and each such
Stockholder has agreed to enter into, this Agreement.
NOW, THEREFORE, to induce Merger Co. to enter into, and in
consideration of its entering into, the Merger Agreement, and in consideration
of the premises and the representations, warranties and covenants contained
herein, the parties agree as follows:
1 Representations and Warranties of Each Stockholder. Each Stockholder
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hereby severally represents and warrants to Merger Co. as follows:
(a) Ownership of Shares. Such Stockholder is either (A) the record holder
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and beneficial owner of, (B) trustee of a trust that is the record holder or
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beneficial owner of, and whose beneficiaries are the beneficial owners (such
trustee, a "Trustee") of, (C) executor of an estate that is the record holder or
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beneficial owner of, and whose beneficiaries are the beneficial owners (such
executor, an "Executor") of, or (D) the beneficial owner but not the record
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holder of, the number of shares of the common stock of the Company, par value
$.01 per share (the "Common Stock"), set forth opposite such Stockholder's name
on Schedule A hereto (the "Shares").
(b) Such Stockholder has (A) sole power of disposition; (B) sole voting
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power and (C) sole power to demand appraisal rights, in each case with respect
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to all of such Stockholder's Shares and with no restrictions on such rights,
subject to applicable federal securities laws and the terms of this Agreement.
(c) Power; Binding Agreement. Such Stockholder has all requisite legal
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capacity, power and authority to enter into and perform all of such
Stockholder's obligations under this Agreement. The execution, delivery and
performance of this Agreement by such Stockholder will not violate any other
agreement to which such Stockholder is a party or by which such Stockholder is
bound, including, without limitation, any trust agreement, will, testamentary
document, voting agreement, stockholders agreement, voting trust or other
agreement. This Agreement has been duly and validly authorized, executed and
delivered by such Stockholder and constitutes a valid and binding agreement of
such Stockholder, enforceable against such Stockholder in accordance with its
terms,
except as such enforceability may be limited by bankruptcy, insolvency,
moratorium or other similar laws affecting or relating to the enforcement of
creditors' rights generally or by general principles of equity. There is no
beneficiary of or holder of a voting trust certificate or other interest of any
trust of which a Stockholder is Trustee or any estate in respect of which a
Stockholder is an Executor whose consent is required for the execution and
delivery of this Agreement or the consummation of the transactions contemplated
hereby. If such Stockholder is married and such Stockholder's Shares constitute
community property or otherwise require spousal or other approval for this
Agreement to be legal, valid and binding, this Agreement has been duly
authorized, executed and delivered by, and constitutes a valid and binding
agreement of, such Stockholder's spouse, enforceable against such person in
accordance with its terms, except as such enforceability may be limited by
bankruptcy, insolvency, moratorium or other similar laws affecting or relating
to the enforcement of creditors' rights generally or by general principles of
equity.
(d) No Conflicts. Except for filings under the Hart-Scott-Rodino
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Antitrust Improvements Act of 1976, as amended, if applicable (i) no filing
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with, and no permit, authorization, consent or approval of, any state or federal
public body or authority is necessary to be made or obtained by such Stockholder
for the execution of this Agreement by such Stockholder and the consummation by
such Stockholder of the transactions contemplated hereby and (ii) neither the
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execution and delivery of this Agreement by such Stockholder nor the
consummation by such Stockholder of the transactions contemplated hereby nor
compliance by such Stockholder with any of the provisions hereof shall (A)
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conflict with or result in any breach of any applicable trust, estate, or other
organization documents applicable to such Stockholder, (B) result in a violation
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or breach of, or constitute (with or without notice or lapse of time or both) a
default (or give rise to any third party right of termination, cancellation,
modification, prepayment or acceleration) under any of the terms, conditions or
provisions of any note, bond, mortgage, indenture, license, contract,
commitment, arrangement, understanding, agreement or other instrument or
obligation of any kind to which such Stockholder is a party of by which such
Stockholder or any of such Stockholder's properties or assets may be bound or
(C) violate any order, writ, injunction, decree, judgment, statute, rule,
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regulation or governmental permit or license (collectively, "Laws") applicable
to such Stockholder or any of such Stockholder's properties or assets.
(e) Absence of Liens. Except as set forth on Schedule B hereto, such
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Stockholder's Shares and the certificates representing such Shares are now and
at all times during the term hereof will be held by such Stockholder, or by a
nominee or custodian for the benefit of such Stockholder, free and clear of all
liens, claims, security interests, proxies, voting trusts or agreements,
understandings, arrangements or any other encumbrances whatsoever, except for
any such encumbrances or proxies arising hereunder. Such Stockholder is not in
default under any of the credit or other like arrangements secured by the liens
set forth on Schedule B hereto, and has no reason to believe that any such
default will occur prior to the Termination Date.
(f) No Brokers. No broker, investment banker, financial adviser or other
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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 based upon arrangements made by or on behalf of such Stockholder.
(g) Review of Merger Agreement. Such Stockholder understands and
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acknowledges that
Merger Co. is entering into the Merger Agreement in reliance upon such
Stockholder's execution and delivery of this Agreement. Such Stockholder has
read the Merger Agreement carefully and fully understands the terms and
provisions thereof.
2 Agreement to Vote; Proxy.
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(a) Voting. Each Stockholder hereby severally agrees that, during the
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time this Agreement is in effect, at any meeting of the stockholders of the
Company, however called, or in connection with any written consent of the
stockholders of the Company, such Stockholder shall vote (or cause to be voted)
the Shares of such Stockholder (i) in favor of the adoption of the Merger
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Agreement and the approval of the terms thereof and each of the other actions
contemplated by the Merger Agreement and this Agreement and any actions required
in furtherance hereof and thereof; (ii) against any action or agreement that
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would result in a breach of any covenant, representation or warranty or any
other obligation or agreement of the Company under the Merger Agreement or this
Agreement; and (iii) except as specifically requested in writing by Merger Co.
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in advance, against the following actions (other than the Merger and the
transactions contemplated by the Merger Agreement): (A) any extraordinary
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corporate transaction, such as a merger, consolidation or other business
combination involving the Company or its subsidiaries; (B) a sale, lease or
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transfer of a material amount of assets of the Company or its subsidiaries or a
reorganization, recapitalization, dissolution, liquidation or winding up of the
Company or any of its subsidiaries; (C) any change in the majority of the board
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of directors of the Company; (D) any material change in the present
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capitalization of the Company or any amendment of the Company's Certificate of
Incorporation; (E) any other material change in the Company's corporate
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structure or business; and (F) any other action which is intended or would
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reasonably be expected to impede, interfere with, delay, postpone, discourage or
materially adversely affect the Merger, the transactions contemplated by the
Merger Agreement or this Agreement or the contemplated economic benefits of any
of the foregoing. Such Stockholder shall not enter into any agreement or
understanding with any Person prior to the Termination Date (as defined in
Section 7) to vote in any manner inconsistent with clause (i), (ii) or (iii) of
the preceding sentence.
(b) PROXY. EACH STOCKHOLDER HEREBY GRANTS TO, AND APPOINTS EACH OF MERGER
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CO. AND EACH OF JAMES J. CONNORS, II AND FRANK LOVERRO IN THEIR RESPECTIVE
CAPACITIES AS OFFICERS OF MERGER CO., AND ANY INDIVIDUAL WHO SHALL HEREAFTER
SUCCEED TO ANY SUCH OFFICE OF MERGER CO., AND ANY OTHER DESIGNEE OF MERGER CO.,
AS SUCH STOCKHOLDER'S IRREVOCABLE (UNTIL THE TERMINATION DATE) PROXY AND
ATTORNEY-IN-FACT (WITH FULL POWER OF SUBSTITUTION) TO VOTE THE SHARES AS
INDICATED IN SECTION 2(a) ABOVE. EACH STOCKHOLDER INTENDS THIS PROXY TO BE
IRREVOCABLE (UNTIL THE TERMINATION DATE) AND COUPLED WITH AN INTEREST AND WILL
TAKE SUCH FURTHER ACTION AND EXECUTE SUCH OTHER INSTRUMENTS AS MAY BE NECESSARY
TO EFFECTUATE THE INTENT OF THIS PROXY AND HEREBY REVOKES ANY PROXY PREVIOUSLY
GRANTED BY SUCH STOCKHOLDER WITH RESPECT TO SUCH STOCKHOLDER'S SHARES.
NOTWITHSTANDING THE FOREGOING, THIS PROXY SHALL BE AUTOMATICALLY REVOKED WITHOUT
ANY FURTHER ACTION ON THE PART OF ANY STOCKHOLDER OR MERGER CO. ON THE
TERMINATION DATE.
(c) Stockholder Capacity. (i) No Person executing this Agreement who is,
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or becomes during the term hereof, a director or officer of the Company makes
any agreement or understanding herein in his or her capacity as such director or
officer, and the agreements set forth herein shall in no way restrict any
director or officer in the exercise of his or her fiduciary duties as a director
or officer of the Company. Each Stockholder signs solely in his or her capacity
as the record and beneficial owner of such Stockholder's Shares or as a Trustee
or Executor, in each case whose beneficiaries are the beneficial owners of such
Stockholder's Shares.
(ii) Merger Co. acknowledges that no individual who has an ownership
interest in any of the Stockholders or who is an officer, director, employee,
trustee, executor, beneficiary or member of any of the Stockholders or any of
the partners of any of the Stockholders is making any agreement or understanding
herein in his or her capacity as a director or officer of the Company and that
each of the Stockholders signs solely in its capacity as the record holder and
beneficial owner of such Stockholder's Shares or as Trustee or Executor, in each
case whose beneficiaries are the beneficial owners of such Stockholder's Shares,
and nothing herein shall limit or affect any actions taken by any individual who
has an ownership interest in any of the Stockholders or who is an officer,
director, employee, trustee, executor, beneficiary or member of any of the
Stockholders or any of the partners of any of the Stockholders in his or her
capacity as a director or officer of the Company.
3 Certain Covenants of Stockholders. Except in accordance with the
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terms of this Agreement, each Stockholder hereby severally covenants and agrees
as follows:
(a) No Solicitation. Such Stockholder has read and fully understands
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Section 4.04 of the Merger Agreement and agrees to abide by all of the
provisions thereof applicable to such Stockholder. Without limiting the
generality of the foregoing, no Stockholder shall, directly or indirectly
(including through advisors, agents or other intermediaries), initiate, solicit,
negotiate, encourage, provide confidential information or take any other action
to facilitate any proposal or offer by any Person that constitutes or could
reasonably be expected to lead to a Company Takeover Proposal.
(b) Restriction on Transfer, Proxies and Non-Interference; Restriction on
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Withdrawal. No Stockholder shall, directly or indirectly: (i) except pursuant
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to the terms of the Merger Agreement and this Agreement, and except for gifts to
family members who either are signatories to this Agreement or who, upon such
gift, become signatories to this Agreement, offer for sale, sell, transfer,
tender, pledge, encumber, assign or otherwise dispose of (collectively,
"Disposition"), enforce or permit the execution of the provisions of any
agreement with the Company whereby the Company may be obligated to repurchase,
or enter into any other contract, option or other arrangement or understanding
with respect to, or otherwise consent to the Disposition of any or all of such
Stockholder's Shares or any interest therein; (ii) except as contemplated
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hereby, grant any proxies or powers of attorney, deposit any Shares into a
voting trust or enter into a voting agreement with respect to any Shares; or
(iii) take any action that would make any representation or warranty of such
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Stockholder contained herein untrue or incorrect or have the effect of
preventing or disabling such Stockholder from performing such Stockholder's
obligations under this Agreement.
(c) Waiver of Appraisal Rights. Each Stockholder hereby waives any
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appraisal rights that such Stockholder may have in connection with the Merger.
Each Trustee and Executor represents that no beneficiary who is a beneficial
owner of Shares under any trust or estate for which such Stockholder acts as
Trustee or Executor, respectively, has any appraisal rights which have not been
so waived.
(d) No Termination or Closure of Trusts and Estates. Each Stockholder who
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is a Trustee or Executor shall not take any action to terminate, close or
liquidate any such trust or estate and shall take all steps necessary to
maintain the existence thereof at least until the first to occur of (i) the
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Effective Time and (ii) the Termination Date, in each case unless, in connection
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therewith, the Shares held by any trust or estate which are presently subject to
the terms of this Agreement are transferred upon termination to one or more
Stockholders and remain subject in all respects to the terms of this Agreement,
or other Persons or entities who upon receipt of such Shares become parties to,
and agree to be bound by the terms and conditions of, this Agreement.
(e) Additional Shares. In the event that any of the banks listed on
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Schedule B hereto enforces its rights under any of the applicable security
agreements listed on such Schedule such that such Stockholder ceases to have the
sole power of disposition and the sole voting power with respect to any of the
Shares subject to such security agreement, such Stockholder shall use its best
efforts to cause additional shares of Common Stock owned by such Stockholder to
become subject to this Voting Agreement such that, after giving effect to such
action, the aggregate number of shares of Common Stock owned by such Stockholder
and subject to this Voting Agreement represents 29.99% of the issued and
outstanding Common Stock on a fully diluted basis.
4 Further Assurances. From time to time, at any party's request and
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without further consideration, each other party shall execute and deliver such
additional documents and take all such further action as may be necessary or
desirable to consummate and make effective, in the most expeditious manner
practicable, the transactions contemplated by this Agreement.
5 Certain Events. Each Stockholder agrees that this Agreement and the
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obligations hereunder shall attach to such Stockholder's Shares and, subject to
the rights of the lien holders listed on Schedule B hereto upon a default under
any of the applicable security agreements listed on such Schedule, 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, without
limitation, such Stockholder's heirs, guardians, administrators or successors or
as a result of any divorce.
6 Stop Transfer. Each Stockholder agrees with, and covenants to, Merger
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Co. that such Stockholder shall not request that the Company register the
transfer (book-entry or otherwise) of any certificate or uncertificated interest
representing any of such Stockholder's Shares, unless such transfer is made in
compliance with this Agreement. Each Stockholder agrees, with respect to any
Shares in certificated form, that such Stockholder will tender to the Company,
within ten business days after the date hereof, the certificates representing
such Shares and the Company will inscribe upon such certificates the following
legend: "The shares of Common Stock, par value $.0l per share, of Citation
Corporation (the "Company") represented by this certificate are subject to a
Voting Agreement dated as of June 24, 1999, and may not be sold or otherwise
transferred, except in accordance therewith. Copies of such Agreement may be
obtained at the principal executive offices
of the Company." Each Stockholder agrees that within ten business days after the
date hereof, such Stockholder will no longer hold any Shares, whether
certificated or uncertificated, in "street name" or in the name of any nominee.
7 Termination. This Agreement shall terminate upon the earlier of (a)
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the termination of the Merger Agreement for any reason (provided that any
Termination Fee and Expenses which are then due and owing to Merger Co. (or its
designee) under the terms of the Merger Agreement have been paid) or (b) the
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Effective Time. The date of termination of this Agreement is referred to herein
as the "Termination Date".
8 Releases. Effective from and after the Effective Time, each
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Stockholder hereby irrevocably waives and releases all known and unknown claims
it may have against the Company, its subsidiaries, Merger Co. and any present
and former directors, officers, agents and employees of the Company, its
subsidiaries and Merger Co. from any and all actions, claims, causes of action
or liabilities of any nature, in law or equity, known or unknown, and whether or
not heretofore asserted, which such Stockholder ever had, now has or hereafter
can, shall or may have against any of the foregoing for, upon or by reason of
any matter, cause or thing whatsoever from the formation of the Company and each
subsidiary of the Company to the Effective Time, other than with respect to (i)
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any rights to indemnification or advancement of expenses from the Company or any
subsidiary of the Company, (ii) any compensation or benefits which such
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Stockholder is entitled to receive pursuant to any employment agreement or
similar agreement with, or benefit plan of, the Company or any subsidiary of the
Company and (iii) as provided in Section 5.05 of the Merger Agreement.
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9 Miscellaneous.
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(a) Entire Agreement; Assignment. This Agreement (i) constitutes the
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entire agreement among the parties with respect to the subject matter hereof and
supersedes all other prior agreements and understandings, both written and oral,
among the parties with respect to the subject matter hereof and (ii) shall not
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be assigned by operation of law or otherwise without the prior written consent
of (A) in the case of an assignment by a Stockholder, Merger Co. and (B) in the
case of an assignment by Merger Co. under any circumstance, provided that Merger
Co. may in its sole discretion assign its rights and obligations hereunder to
any of its direct or indirect wholly-owned subsidiaries.
(b) Amendments. This Agreement may not be modified, amended, altered or
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supplemented, except upon the execution and delivery of a written agreement
executed by the parties hereto; provided, however, that Schedule A may be
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supplemented by Merger Co. without the agreement of any other party, by adding
the name and other relevant information concerning any stockholder of the
Company who agrees to be bound by the terms of this Agreement, and thereafter
such added stockholder shall be treated as a "Stockholder" for all purposes of
this Agreement.
(c) Notices. All notices and other communications under this Agreement
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shall be in writing and shall be given (and shall be deemed to have been duly
given upon receipt) by delivery in person, facsimile, telex or other standard
form of telecommunications, by courier service, or by registered or certified
mail, postage prepaid, return receipt requested, addressed
If to Merger Co., to:
c/o Kelso & Company
320 Park Avenue - 24th Floor
New York, NY 10022
Attn: James J. Connors, II, Esq.
With a copy to:
Debevoise & Plimpton
875 Third Avenue
New York New York 10022
Facsimile No.: (212) 909-6836
Attention: Richard D. Bohm, Esq.
If to a Stockholder, to such Stockholder's address or facsimile number
set forth in Schedule A hereto,
or to such other address or facsimile number as the Person to whom notice is
given shall have previously furnished to the others in writing in the manner set
forth above.
(d) Governing Law. This Agreement shall be governed by and construed in
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accordance with the laws of the State of Delaware without giving effect to the
conflicts of laws principles thereof.
(e) Enforcement. The parties agree that irreparable damage would occur in
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the event that any of the provisions of this Agreement were not performed in
accordance with their specific terms or were otherwise breached. It is
accordingly agreed that the parties shall be entitled to seek an injunction or
injunctions to prevent breaches of this Agreement and to enforce specifically
the terms and provisions of this Agreement.
(f) Counterparts. This Agreement may be executed in one or more
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counterparts, each of which shall be deemed to be an original, but all of which
when taken together shall constitute one and the same Agreement.
(g) Descriptive Headings. The descriptive headings used herein are
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inserted for convenience of reference only and are not intended to be part of or
to affect the meaning or interpretation of this Agreement.
(h) Severability. Whenever possible, each provision or portion of any
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provision of this Agreement will be interpreted in such manner as to be
effective and valid under applicable law but if any provision or portion of any
provision of this Agreement is held to be invalid, illegal or unenforceable in
any respect under any applicable law or rule in any jurisdiction, such
invalidity, illegality or unenforceability will not affect any other provision
or portion of any provision in such jurisdiction, and this Agreement will be
reformed, construed and enforced in such jurisdiction as if such invalid,
illegal or unenforceable provision or portion of any provision had never been
contained herein.
(i) Definitions; Construction. For purposes of this Agreement:
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(i) "beneficially own" or "beneficial ownership" with respect to any
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securities shall mean having "beneficial ownership" of such securities (as
determined pursuant to Rule 13d-3 under the Exchange Act), including
pursuant to any agreement, arrangement or understanding, whether or not in
writing. Without duplicative counting of the same securities by the same
holder, securities beneficially owned by a Person shall include securities
beneficially owned by all other Persons with whom such Person would
constitute a "group" as described in Section 13(d)(3) of the Exchange Act.
(ii) "Person" shall mean an individual, corporation, partnership,
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limited liability company, joint venture, association, trust,
unincorporated organization or other entity.
(iii) In the event of a stock dividend or distribution, or any change
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in the Company Common Stock by reason of any stock dividend, split-up,
recapitalization, combination, exchange of shares or the like, the term
"Shares" shall be deemed to refer to and include the Shares as well as all
such stock dividends and distributions and any shares into which or for
which any or all of the Shares may be changed or exchanged.
IN WITNESS WHEREOF, Merger Co. and each Stockholder have caused this
Agreement to be duly executed as of the day and year first above written.
RSJ ACQUISITION CO.
By: /s/ James J. Connors II
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Wilmington Trust Company, as Trustee
of the Morris Hackney Irrevocable Trust
dated June 1, 1999
By: /s/ Daryl S. Gebhart
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Its:Vice President
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Hackney One Investments, LLC
a Delaware limited liability company
By: /s/ T. Morris Hackney
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T. Morris Hackney
Its Manager
Hackney Two Investments, LLC
a Delaware limited liability company
By: /s/ T. Morris Hackney
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T. Morris Hackney
Its Manager
Hackney Three Investments, LLC
a Delaware limited liability company
By: /s/ T. Morris Hackney
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T. Morris Hackney
Its Manager
The Hackney Foundation
an Alabama nonprofit corporation
By: /s/ Brenda M. Hackney
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Brenda M. Hackney
Its President
Wilmington Trust Company, as Trustee
of the Brenda M. Hackney Irrevocable Trust
dated June 1, 1999
By: /s/ Daryl S. Gebhart
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Its: Vice President
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/s/ Brenda M. Hackney
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Brenda M. Hackney, as Trustee of Declaration
of Trust dated October 2, 1994 for the
benefit of Thomas Mitchell Hackney
/s/ Brenda M. Hackney
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Brenda M. Hackney, as Trustee of Declaration
of Trust dated October 2, 1994 for the
benefit of Anne Morris Hackney
Stockholder name and address: Shares
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Wilmington Trust Company, as Trustee 1,009,840*
of the Morris Hackney Irrevocable Trust dated June 1, 1999
Rodney Square North
1100 North Market Street
Wilmington, DE 19890-0001
Attn: Daryl Gebhart
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Hackney One Investments, LLC, a Delaware limited liability company 3,299,634
2 Office Park Circle, Suite One
Birmingham, Alabama 35223
Attn: T. Morris Hackney
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Hackney Two Investments, LLC, a Delaware limited liability company 160,000
2 Office Park Circle, Suite One
Birmingham, Alabama 35223
Attn: T. Morris Hackney
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Hackney Three Investments, LLC, a Delaware limited liability company 160,000
2 Office Park Circle, Suite One
Birmingham, Alabama 35223
Attn: T. Morris Hackney
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The Hackney Foundation, an Alabama nonprofit corporation 338,000
2 Office Park Circle, Suite One
Birmingham, Alabama 35223
Attn: Brenda M. Hackney
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____________________
* see Schedule B
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Wilmington Trust Company, as Trustee 364,166
of the Brenda M. Hackney Irrevocable Trust dated June 1, 1999
Rodney Square North
1100 North Market Street
Wilmington, DE 19890-0001
Attn: Daryl Gebhart
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Brenda M. Hackney, as Trustee of Declaration of Trust dated 9,200
October 2, 1994 f/b/o Thomas Mitchell Hackney
2 Office Park Circle, Suite One
Birmingham, Alabama 35223
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Brenda M. Hackney, as Trustee of Declaration of Trust dated 9,200
October 2, 1994 f/b/o Anne Morris Hackney
2 Office Park Circle, Suite One
Birmingham, Alabama 35223
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TOTAL 5,350,040
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An aggregate of 1,009,840 of the Shares are subject to security agreements:
700,000 shares pledged to Colonial Bank
300,000 shares pledged to National Bank of Commerce
9,840 shares pledged to AmSouth Bank
Notwithstanding such security agreements, such Stockholder has the power and
authority to execute and deliver this Agreement and, in the absence of a default
under any such security agreement, has the sole power of disposition and sole
voting power with respect to all such Shares.