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Exhibit 9.1
1996 DANIELS VOTING TRUST AGREEMENT
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THIS AGREEMENT made effective as of the 19th day of August, 1996, by and
among Susan H. Daniels ("SHD"), Robert L. Daniels ("RLD"; RLD and SHD being
hereinafter referred to from time to time collectively as the "Stockholders"),
and Robert L. Daniels, as trustee of the voting trust created by this voting
trust agreement (the "Trustee").
WHEREAS, the Stockholders, among others, entered into a Voting Trust
Agreement dated April 29, 1994 (the "1994 Voting Trust Agreement"), which was
subsequently amended and restated by agreement dated as of December 1, 1995, and
was terminated as a result of RLD's resignation as Chairman and Chief Executive
Officer of Project Software & Development, Inc. (the "Corporation") on August
19, 1996; and
WHEREAS, RLD and SHD own, beneficially, 1,097,629 and 1,091,129 shares of
the common stock, $.01 par value, of the Corporation, respectively, which were
subject to the terms of the 1994 Voting Trust, as amended and restated; and
WHEREAS, the Stockholders desire to make said shares subject to this 1996
Daniels Voting Trust Agreement ("Agreement");
NOW, THEREFORE, in consideration of the premises and the mutual covenants
herein contained and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:
1. NAME. The trust created by this Agreement shall be known as the 1996
Daniels Voting Trust.
2. Transfer of Stock to the Trustee.
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(a) The RLD Shares and SHD Shares deposited in trust with the Trustee
under this Agreement, together with all other shares of capital stock of the
Corporation deposited from and after the date hereof with the Trustees under
this Agreement, whether pursuant to this Section 2(a) or by reason of the
payment of dividends by the corporation in capital stock of the Corporation, the
offering of subscription rights by the Corporation to the holders of its capital
stock, a reorganization or recapitalization of the Corporation or otherwise, are
hereinafter referred to as the "Restricted Securities." The Trustee shall hold
the Restricted Securities subject to the terms of this Agreement.
(b) All certificates for Restricted Securities transferred and delivered
to the Trustee pursuant to this Agreement shall be surrendered by the Trustee to
the Corporation and shall be cancelled on the books of the Corporation, and new
certificates therefor shall be issued by the Corporation to the Trustee in the
name of "Robert L. Daniels, as Trustee under the 1996 Daniels Voting Trust." All
certificates representing Restricted Securities issued to the Trustee under this
Agreement shall have endorsed thereon, in addition to any other legends thereon,
a legend in substantially the following form:
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The securities represented by this certificate are subject to restrictions
on voting and transfer set forth in a Voting Trust Agreement dated as of
August 19, 1996 between Susan H. Daniels and Robert L. Daniels,
individually and as Trustee.
3. Voting Trust Certificates.
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(a) Upon delivery to the Trustee by each Stockholder of the certificate
or certificates for their respective Restricted Securities, together with all
necessary instruments of transfer, such Stockholder shall be deemed to be the
beneficial owner of the number of Restricted Securities so deposited with the
Trustee (the "Beneficial Shares"), which beneficial ownership shall be evidenced
by a voting trust certificate or certificates (the "Voting Trust Certificates"),
and the Trustee shall issue and deliver or cause to be delivered to such
Stockholder a Voting Trust Certificate for the number of Restricted Securities
so deposited and transferred by such Stockholder. All such Voting Trust
Certificates shall be in substantially the form of Exhibit A hereto.
(b) Each registered holder of a Voting Trust Certificate shall be
entitled to receive copies of all notices of meetings, annual or period reports
to stockholders or other materials distributed by the Corporation generally to
the holders of any class of securities of which any outstanding shares
constitute Restricted Securities ("Stockholder Information"), and the Trustee
shall, upon his receipt from the Corporation of any Stockholder Information in
respect of Restricted Securities held subject to this Agreement, promptly mail
copies of such Stockholder Information to each such holder of a Voting Trust
Certificate at his or her address as shown on the books of the Trustee. Each
Stockholder acknowledges and agrees that the rights and powers of the Trustee
hereunder, including, without limitation, those rights and powers set forth in
Section 11 below, shall not be affected by any failure of the Trustee to comply
with the provisions of this subsection 3(b).
4. Provisions Regarding Transfer of Beneficial Shares.
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(a) During the term of this Agreement, neither Stockholder shall,
except as otherwise permitted by Section 4(b) and 4A below, sell, assign,
convey, pledge, encumber, hypothecate, subject to any call, option or agreement
to purchase or otherwise transfer any of the Beneficial Shares standing in his
or her name, or any interest therein, or agree or purport to do any of the
foregoing.
(b) Notwithstanding the foregoing, the following transactions shall not
be deemed to be prohibited by this Section 4 (each a "Permitted Transfer"):
(i) A transfer by either Stockholder made for estate planning
purposes to a trust for the benefit of such Stockholder or of any
member of his or her family or directly to any member of his or
her family; PROVIDED, however, that any Beneficial Shares so
transferred shall remain subject to this Voting Trust Agreement
for as long as such Agreement remains in force.
(ii) Subject to Section 4(d) below, a transfer of Beneficial Shares by
either Stockholder in a BONA FIDE transfer for value to a third
party unaffiliated with the transferor (a "Sale"), in which event
the transferee shall hold the Beneficial Shares so transferred
free of the Voting Trust created hereby and shall be entitled to
receive from the Corporation a certificate registered in such
name as the transferee shall designate. The Trustee hereby agrees
to issue and deliver to the Corporation or its transfer agent
such certificates and
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instructions and to take such other action as may be necessary on
his part to effect the Sale and registration in the name of a
permitted transferee pursuant to this subsection 4(b)(ii).
(iii)A pledge of Beneficial Shares to a bank or other financial
institution as collateral security for the obligations of either
Stockholder under an arrangement with such bank or financial
institution in which the Stockholder simultaneously establishes
both put and call positions with respect to the Common Stock of
the Corporation (a "Collateralized Collar") shall be deemed to
constitute a Sale pursuant subsection 4(b)(ii) above. Upon
receipt by the Trustee of written notice from the Stockholder
that he or she intends to enter into a Collateralized Collar,
setting forth the terms of such Collateralized Collar, such
Stockholder shall be entitled to receive a certificate
representing the pledged shares registered in such name as he or
she shall designate and free of any restrictive legend (except as
otherwise required by law). The bank or other financial
institution, and any of its transferees, shall hold the pledged
shares free of the Voting Trust and any other restrictions on
transfer or voting of the pledged shares created by this
agreement.
(c) It shall be a further condition to any transfer made pursuant to
subsection 4(b)(i) above that the transferee, if not already a party to this
Agreement, shall execute and deliver to the Trustee an instrument in form and
substance satisfactory to the Trustee evidencing the agreement of such
transferee to become a party to and be bound by this Agreement. SHD agrees, as a
further condition to any transfer made by her pursuant to subsection 4(b)(iii)
above, that to the extent that she has the power to direct the voting of any
shares of Common Stock held by any bank or other financial institution pursuant
to a Collateralized Collar she will direct that such shares be voted in
accordance with the written instructions of the Voting Trustee, provided, that
such bank or financial institution shall not have any obligation to determine
independently whether any such direction given by SHD is in conformity with any
instructions of the Voting Trustee.
(d) Notwithstanding the foregoing, and except as otherwise set forth in
subsection 4(e) and (f) below, the aggregate number of shares of Common Stock
transferred by SHD by Sale (including Beneficial Shares transferred pursuant to
subsection 4(b)(ii) or (iii) above) during any calendar quarter prior to the
termination or expiration of this Agreement shall not exceed the greater of (i)
27,500, or (ii) the aggregate number of shares of Common Stock transferred by
Sale by RLD or by any donee of RLD (including Beneficial Shares transferred
pursuant to subsection 4(b)(ii) or (iii) above) during such quarter (the
"Limitation Amount"). The Limitation Amount shall be adjusted for any stock
dividend, stock dividend, stock split, consolidation, reverse stock split,
consolidation, reclassification or other similar transaction effected by the
Corporation with respect to its Common Stock after the date hereof. Subject to
subsection 4(f) below, in the event that the number of Beneficial Shares
actually transferred by SHD pursuant to subsection 4(b)(ii) or (iii) above
during any calendar quarter is less than the Limitation Amount in respect of
such calendar quarter, then the unused balance of the Limitation Amount shall be
carried forward to the next calendar quarter and the Limitation Amount for such
subsequent calendar quarter shall be increased by the amount of such unused
balance. The limitation set forth in this paragraph (the "Volume Limitation")
shall terminate and be of no further force and effect upon the earlier to occur
of the following:
(i) If the Average Share Price, (as hereinafter defined), determined
as of the last day of any of the eighteen-month periods beginning
on January 1, 1996; July
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1, 1997; January 1, 1999; January 1, 2002; and July 1, 2003 and
January 1, 2005 (each a "Measurement Period"), shall not have
increased at a 10% compound annual rate in comparison to the
Average Share Price determined as of the first day of such
Measurement Period; or
(ii) The fifth anniversary of the date hereof; PROVIDED, that
(iii)in the event of the death of SHD prior to such fifth
anniversary, the Volume Limitation shall (to the extent
terminated pursuant to subsection 4(d)(i) above) be reinstated
and, notwithstanding the provisions of such subsection, shall
continue in force as to all SHD Shares then subject to this
Agreement and the trust created hereby until the occurrence of
such fifth anniversary.
For purposes of this paragraph, the "Average Share Price" determined as of any
date shall mean the average of the closing prices of the Common Stock, as
reported by the NASDAQ National Market, or by such other automated quotation
system or national or regional stock exchange on which the Common Stock is then
publicly traded, on each of the twenty (20) business days preceding such date
(adjusted as necessary to give effect to any stock split, reverse stock split,
stock dividend, recapitalization or other similar transaction affecting the
Common Stock occurring during the relevant Measurement Period).
(e) RLD agrees that, if, at any time prior to the fifth anniversary of
the date of this Agreement and thereafter during the lifetime of SHD, any public
offering of the Corporation's Common Stock that includes shares to be sold for
the account of selling stockholders (a "Secondary Offering") shall be effected
and if any shares shall be included in such Secondary Offering for the account
of RLD (whether constituting Beneficial Shares or not), then in such event RLD
will use his best efforts to cause to be included in the Secondary Offering such
number of the SHD Shares as SHD may request in writing within twenty (20) days
of the receipt from the Company of written notice that it intends to effect such
Secondary Offering (the "Registrable SHD Shares"). Unless all the Registrable
SHD shares are included in the Secondary Offering, the number of shares to be
included for the account of RLD in such Secondary Offering shall not exceed the
number of Registrable SHD shares or such lesser number of shares as is actually
included in the Secondary Offering for the account of SHD.
The Stockholders acknowledge that they have been advised that their
sales of Common Stock may be required to be aggregated for purposes of the
volume limitations of Rule 144 promulgated by the Securities and Exchange
Commission pursuant to the Securities Act of 1933, as amended ("Rule 144"). Each
Stockholder agrees that he or she (i) will notify the other in writing prior to
any Sale of Common Stock (including any transfer of Beneficial Shares pursuant
to subsection 4(b)(ii) or (iii) above, and whether or not such Sales is subject
to Rule 144), and (ii) will not, without the prior written consent of the other,
effect any such Sale of Common Stock that would cause the aggregate number of
shares of Common Stock so transferred by such Stockholder during any three-month
period to exceed one-half of the aggregate number that would be permitted to be
sold by both Stockholders during such three-month period under Rule 144(e). The
Stockholders further acknowledge that they have been advised that each
collateralized option written by them in connection with the establishment of a
Collateralized Collar pursuant to subsection 4(b)(iii) above may be deemed to
constitute a separate sale of the underlying shares for purposes of the volume
limitations of Rule 144, and agree that each such option will be counted as a
separate Sale for purposes of the Limitation Amount referred to in subsection
4(d) above.
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(f) In the event that during any calendar quarter the number of
Beneficial Shares transferred by SHD pursuant to subsection 4(b)(ii) and (iii)
above exceeds the number of Beneficial Shares transferred by RLD pursuant to
such subsection during such quarter (including, in each case, any Beneficial
Shares sold in a Secondary Offering), then on the first day of the calendar
quarter there shall automatically be released from the trust created hereby and
distributed to RLD in his own name a number of Beneficial Shares that is equal
to such excess.
(g) The Trustee shall keep a record of Voting Trust Certificates and
shall be entitled to rely conclusively upon said record as to the identity and
address of the holders of Voting Trust Certificates. The Trustee may treat the
registered holder of each Voting Trust Certificate as the owner thereof and of
the Beneficial Shares evidenced thereby for all purposes whatsoever, but the
Trustee shall not be required to deliver certificates for Restricted Securities
as required hereunder without the surrender of the corresponding Voting Trust
Certificates. In addition, the Trustee shall not be required to recognize any
transfer of any Voting Trust Certificate or Beneficial Share not made in
accordance with the provisions hereof unless the person claiming such ownership
shall produce indicia of title satisfactory to the Trustee and shall deposit
with the Trustee an indemnity satisfactory to the Trustee.
(h) If any Voting Trust Certificate is lost, stolen, mutilated, damaged
or destroyed, the Trustee shall issue a duplicate of such certificate upon
receipt of: (i) evidence of such fact satisfactory to him, (ii) an indemnity
satisfactory to him; (iii) the existing certificate, if mutilated or damaged;
and (iv) the Trustee's reasonable fees and expenses in connection with the
issuance of a replacement Voting Trust Certificate.
4A SALES OF BENEFICIAL SHARES IN CERTAIN CIRCUMSTANCES. Notwithstanding
any other provision of this Agreement to the contrary, the parties
hereto may sell their entire respective interests in the Beneficial
Shares as follows:
(A) A sales of the entire interest of the Beneficial Shares approved
by the Stockholders in connection with a tender or exchange offer
for all the common shares of the Company (collectively a
"Takeover");
(B) A Sale of the entire interest of the Beneficial Shares in
connection with a Takeover by any party hereto for a price, which
a Qualified Investment Bank has opined is fair from a financial
point of view. A Qualified Investment Bank is any investment bank
mutually acceptable to the parties hereto. The parties hereto
agree not to unreasonably withhold their approval of any
investment bank proposed by either of them; provided, however,
that any party who wishes to sell his or her entire interest in
Beneficial Shares at a price approved as fair by a Qualified
Investment Bank shall be required to offer in writing to sell his
or her entire interest in Beneficial Shares to the other party
hereto (the "Offer") for a period of ten (10) business days at
the price approved as fair by the Qualified Investment Bank or
such higher price, if any, as may be offered in connection with
the Takeover prior to acceptance of the Offer in writing (the
"Buy-Out Option"). If the consideration offered in connection
with any Takeover includes securities, the securities shall be
valued for purposes of this Buy-Out Option by the Qualified
Investment Bank as of the date of the Offer. The Offer shall be
accepted only by a writing, delivered to the selling
Stockholder's address for notice within the ten (10)
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business day period, unconditionally committing to consummate the
purchase within thirty (30) days or less of the acceptance.
5. ASSENT TO AGREEMENT. Every person from time to time holding a Voting
Trust Certificate or Certificates, whether a Stockholder or one claiming through
or under a Stockholder, by the fact of such person's acceptance of such Voting
Trust Certificate or Certificates, shall be deemed to have assented and agreed
to all of the provisions of this Agreement.
6. Dividends.
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(a) Prior to the expiration or earlier termination of this Agreement,
the holders of Voting Trust Certificates shall be entitled to receive payments
equal to the cash dividends, if any, received by the Trustee from the
Corporation, ratably in proportion to their respective number of Beneficial
Shares then outstanding. In lieu of receiving such cash dividends and paying the
same to the holders of Voting Trust Certificates, the Trustee may instruct the
Corporation in writing to pay such cash dividends directly to the holders of
Voting Trust Certificates. Upon such instructions being given by the Trustee to
the Corporation, and unless explicitly limited or until revoked by the Trustee,
all liability of the Trustee with respect to such cash dividends shall
terminate. The Trustee may at any time revoke such instructions and by written
notice to the Corporation direct it to make dividend payments to the Trustee.
The Corporation shall not be liable to any holder of Voting Trust Certificates
or to any person claiming to be entitled to any such cash dividends by reason of
following ny written instructions of the Trustee.
(b) If any dividend in respect of Restricted Securities owned of record
by the Trustee is paid, in whole or in part, in capital stock of the
Corporation, then (i) the Trustee shall hold, subject to the terms of this
Agreement, the certificate or certificates for shares of such stock which are
received by him on account of such dividend; and (ii) the holder of each Voting
Trust Certificate shall be entitled to receive a Voting Trust Certificate issued
under this Agreement for the number of shares of capital stock received as such
dividend in respect of such holder's Beneficial Shares.
(c) Holders entitled to receive the dividends above shall be those
registered as holders of Voting Trust Certificates on the books of the Trustee
at the close of business on the record date fixed by the Corporation for
determining those holders of its capital stock entitled to receive such
dividends or, if the Corporation has fixed no such record date, then on the date
fixed by the Trustee for the purpose of determining the holders of Voting Trust
Certificates entitled to receive such payment or distribution, those registered
as such at the close of business on the date so fixed by the Trustee; PROVIDED,
that if no such record date is set by the Corporation or the Trustee, then in
such event the record date for determining shall be the close of business on the
day preceding such payment of distribution.
7. SUBSCRIPTION RIGHTS. In case any stock or other securities of the
Corporation are offered for subscription to the holders of Restricted Securities
deposited hereunder, the Trustee, promptly upon receipt of notice of such offer,
shall mail a copy thereof to each of the holders of Voting Trust Certificates.
Upon receipt by the Trustee of a request from any registered holder of a Voting
Trust Certificate or Certificates to subscribe on such holder's behalf,
accompanied by the sum of money required to pay for such stock or securities or
a promise to pay such sum, the Trustee shall make such subscription and payment,
or a promise to make payment, and instruct the Corporation to issue to the
Trustee certificates for such shares of securities so subscribed for in the name
of "Robert L. Daniels, as Trustee under the 1996 Daniels Voting Trust." Upon
receiving from the
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Corporation the certificates for shares or securities so subscribed for, the
Trustee shall issue to such purchasing holder a Voting Trust Certificate in
respect thereof.
8. DISSOLUTION OF THE CORPORATION. In the event of the dissolution or
liquidation of the Corporation, whether voluntary or involuntary, or any other
return of capital to the holders of securities of the Corporation, the Trustee
shall receive the moneys, securities, rights or property to which the holders of
the Restricted Securities held hereunder are entitled, and shall distribute the
same among the registered holders of the Voting Trust Certificates ratably in
accordance with their respective number of Beneficial Shares then outstanding,
or the Trustee may in his discretion deposit such moneys, securities, rights or
property with any bank or trust company doing business in the United States,
with authority and instructions to distribute the same as above provided, and
upon such deposit all further obligations or liabilities of the Trustee in
respect of such moneys, securities, rights or property so deposited shall
terminate.
9. Reorganization or Recapitalization of the Corporation.
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(a) In case the Corporation is merged into or consolidated with another
corporation or entity, or all or substantially all of the assets of the
Corporation are transferred to another corporation or entity, then in connection
with such merger, consolidation or transfer (i) the term "Corporation" for all
purposes of this Agreement shall be taken to include such successor corporation
or entity: (ii) the Trustee shall receive and hold under this Agreement any
stock of such successor corporation or entity which is received on account of
his ownership as Trustee hereunder of the Restricted Securities held hereunder
prior to such merger, consolidation or transfer; and (iii) the Trustee may, in
his discretion, substitute for voting Trust Certificates, new voting trust
certificates in appropriate form, and the terms "Common Stock" and "Restricted
Securities" as used herein shall be taken to include any shares of stock which
may be received by the Trustee in lieu of all or part of the shares of Common
Stock or the Restricted Securities, respectively.
(b) In the event that the Corporation shall effect a stock split,
reverse stock split, consolidation, reclassification or other similar
transaction in respect of any class of its capital stock constituting Restricted
Securities held by the Trustee hereunder, the Trustee shall issue to the holders
of Voting Trust Certificates additional or substitute Voting Trust Certificates
representing such number and class of Beneficial Shares as are issuable in
respect of such Restricted Securities by reason of such transaction; provided,
in the case of substitute Voting Trust Certificates, that there shall have been
surrendered to the Corporation for cancellation the original Voting Trust
Certificate of Certificates in respect of which such substitute Voting Trust
Certificates are to be issued. In the event that the Restricted Securities
include securities of more than one class or series, the Trustee may cause
Voting Trust Certificates designated as belonging to more than one class or
series to be issued to the holder of Beneficial Shares so that each such Voting
Trust Certificate corresponds to Restricted Securities of a particular class or
series.
10. ADDITIONS TO TRUST PROPERTY. From time to time the Trustee may, in
his discretion, receive additional certificates for Restricted Securities either
from a Stockbroker or from any other stockholder of the Corporation who becomes
a signatory hereto, and all such certificates shall be treated as if originally
transferred and deposited hereunder. Upon any such receipt of addition
certificates for Restricted Securities, the Trustee shall cause additional
Voting Trust Certificates representing beneficial interests in such Restricted
Securities to b issued to the beneficial owners of such Restricted Securities to
reflect the transfer and deposit of such Restricted Securities in trust
hereunder.
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11. Rights and Powers of the Trustee: Death of Disability.
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(a) The Trustee shall have full legal title to, and be the record owner
of, the Restricted Securities held hereunder. The Trustee may, but shall not be
obliged to, deposit any stock certificate representing Restricted Securities
with a bank, securities firm or other financial institution for safekeeping in
the name of the Trustee as record owner.
(b) Until the actual delivery to the holder of Voting Trust Certificates
of stock certificates representing Restricted Securities issued in exchange
therefor, and until the surrender of the Voting Trust Certificates for
cancellation upon such delivery, the Trustee shall have the right, subject to
the provisions of this paragraph, (i) to exercise, in person or by his nominee
or proxy, all voting rights and powers in respect of all Restricted Securities
held hereunder, (ii) to take part in or consent to any corporate or
stockholders' action of any kind whatsoever, and (iii) to file applications
with, and otherwise deal with, any Federal or state regulatory agencies with
respect to all matters arising out of or relating to the Restricted Securities.
The right to vote shall include the right to vote in favor of, or against, or to
withhold any vote in respect of, any resolution or proposed action of any
character whatsoever which may be presented at any meeting or which may require
the consent of stockholders of the Corporation, as the Trustee, in his sole
discretion, shall deem appropriate.
(c) Notwithstanding the provisions of paragraph 11(b), in the event the
Corporation shall seek the approval of its shareholders for any proposal for a
merger, liquidation, dissolution or consolidation of the Corporation (the
"Proposed Transaction"), the power of the Trustee to vote the Restricted
Securities shall be subject to the following limitation..
(i) If both Stockholders agree, the Trustee shall vote all such
securities with respect to the Proposed Transaction in accordance
with such agreement;
(ii) If the Stockholders do not agree and a Qualified Investment Bank
has opined that the consideration offered in the Proposed
Transaction is fair from a financial point of view, the Trustee
shall vote the Restricted Securities in accordance with the
directions of the Stockholders, in proportion to their beneficial
ownership interests; provided, however, that the Stockholder
choosing to support such Proposed Transaction shall be required
to offer in writing to sell his or her entire interest in the
Restricted Securities to the other Stockholders (the "Offer") for
a period of ten (10) business days before the date on which such
vote is to be taken at the consideration offered in the Proposed
Transaction (the "Buy-Out Option"). If the consideration offered
includes securities, the securities shall be valued for purposes
of this Buy-Out Option by the Qualified Investment Bank as of the
date of the Offer. The Offer shall be accepted only be a writing,
delivered to the selling Stockholder's address for notice within
the ten (10) business day period, unconditionally committing to
consummate the purchase within thirty (30) days or less of the
acceptance.
(d) In the event that the Trustee should die or suffer a Disability
during the term of this Agreement, his executor (in case of death) or legal
representative (in case of Disability) shall serve as Trustee hereunder. The
term "Disability" shall mean, for purposes of this Agreement, (i) the
adjudication of the Trustee by a court of competent jurisdiction as an
incompetent, or (ii) the imposition by a court of competent jurisdiction of a
conservatorship over the affairs of the Trustee.
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12. Compensation of the Trustee.
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(a) The Trustee shall serve without compensation. The Trustee and each
of his agents shall be reimbursed by the owners of the Beneficial Shares ratably
according to the respective number of Beneficial Shares then outstanding for all
out-of-pocket expenses reasonably incurred by him or any of them in the
performance of his or their respective duties under this Agreement.
(b) Nothing contained herein shall disqualify or incapacitate the
Trustee from serving the Corporation or any of its subsidiaries as an officer,
director or agent acting in any other capacity, holding any shares of any class
of stock in the Corporation or any such subsidiary, becoming a creditor of the
Corporation or any such subsidiary, or in any other way dealing with or
receiving compensation from the Corporation or any such subsidiary, becoming a
creditor of the Corporation or any such subsidiary, or in any other way dealing
with or receiving compensation from the Corporation or any such subsidiary.
13. Standard of Liability
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(a) The Trustee hereunder shall not under any circumstances or in any
event be held liable (as stockholder, Trustee or otherwise) or accountable out
of his personal assets by reason of any error of judgment or mistake of fact or
law or other mistake, if such Trustee was acting in good faith, or in reliance
on the opinion of qualified legal counsel (who may be counsel for the
Corporation) selected in good faith, nor shall the Trustee be held liable by
reason of the act or omission of any agent, proxy, attorney, co-trustee, or
person to whom he may reasonably delegate his powers hereunder; PROVIDED, that
where any provision of this Agreement by its terms applies equally to RLD and to
SHD, nothing in the preceding sentence shall be deemed to authorize the Trustee
to interpret or apply such provision in an inconsistent manner where the
interests of RLD and SHD, respectively, are concerned.
(b) Without limiting the generality of the foregoing, each Stockholder
acknowledges that he or she has been advised that he or she individually will be
responsible for filing any reports required pursuant to Section 16 of the
Securities Exchange Act of 1934 ("Section 16") in respect of his or her
beneficial ownership of Restricted Securities and acknowledges and agrees that
the Trustee in his capacity as such shall have no duty or responsibility with
respect to compliance by either Stockholder with Section 16 or with any other
requirements of federal or state securities law relating to beneficial ownership
or transfer of any Restricted Securities or Beneficial Shares.
(c) In no event shall the Trustee have any liability whatsoever, whether
arising in contract, in tort or otherwise, to any Stockholder, holder of a
Voting Trust Certificate or other person arising out of any vote or consent
lawfully cast or given by him, or withheld by him, in respect of any Voting
Stock held subject to this Agreement.
14. CERTIFICATE OF TRUSTEE. Any certificate in writing executed by the
Trustee setting forth the existence of any fact the existence of which is
necessary to authorize the execution of any instrument or the taking of any
action by the Trustee, or setting forth any other facts in relation to the trust
created hereby, shall, as to all persons acting in good faith in reliance
thereon, be conclusive evidence of the truth of the statements made in such
certificate and of the existence of the facts therein stated to exist.
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15. AMENDMENTS. This Agreement may be amended only by a written instrument
signed by (i) all of the registered holders of Voting Trust Certificates then
outstanding, and (ii) the Trustee. Any amendment shall be sent to all holders of
Voting Trust Certificates by the Trustee.
16. SALE AND TRANSFER OF RESTRICTED SECURITIES. Except pursuant to a
Permitted Transfer, the Trustee shall not sell, hypothecate, pledge, assign or
otherwise transfer legal title to any Restricted Securities held hereunder.
17. Term and Termination: Distribution of Trust Property; Provisions for
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Voting.
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(a) The Restricted Securities held pursuant to this Agreement shall be
released from the trust created hereby and distributed to the Stockholders upon
the satisfaction of certain conditions, as follows:
(i) Upon the expiration or termination of this Agreement and the
trust created hereby pursuant to subsection 17(d) or (e) below,
all Restricted Securities shall be distributed to the registered
holders of the Voting Trust Certificates representing such
Restricted Securities, and each such holder shall be entitled to
receive from the Corporation a certificate representing such
Restricted Securities registered in the name of such holder.
(ii) Notwithstanding the foregoing, the Trustee shall make no
distribution pursuant to Section 17(a)(i) to SHD or to any
transferee of SHD in a transfer pursuant to subsection 4(b)(i)
above unless there shall have been delivered to RLD in his
individual capacity the irrevocable proxy and transfer
restriction agreement of SHD or of such transferee in the form
attached hereto as Exhibit A (each a "Proxy").
(b) Following the expiration or termination of this Agreement and the
delivery to RLD of the foregoing Proxy or Proxies, SHD and any transferee of SHD
(other than an Unrestricted Transferee, as defined in subsection 17(b)(i) below)
(each a "Restricted Transferee"), shall be entitled to sell, assign, convey,
pledge, encumber, hypothecate, subject to any call, option or agreement to
purchase or otherwise transfer any Restricted Securities or any interest
therein, on the following conditions:
(i) SHD and any Restricted Transferee may transfer Restricted
Securities free of the Proxy and any other restrictions set forth
in this Agreement, on the condition that any such transfer shall
be made in a transaction and to a person permitted by subsection
4(b)(ii) or (iii) above (each an "Unrestricted Transferee").
Without limiting the generality of the foregoing sentence, the
term "Unrestricted Transferee" shall also include a transferee
unaffiliated with SHD who purchases Restricted Securities for
value in a BONA FIDE transaction with a bank or financial
institution which is selling such Restricted Securities pursuant
to the exercise of its rights as a secured party with respect to
Restricted Securities pledged to it as collateral security in a
transaction effected in compliance with subsection 17(b)(ii)
below. The Corporation will issue, or will cause its transfer
agent to issue, a certificate or certificates representing the
Restricted Securities so transferred registered in the name of
such Unrestricted Transferee free of the restrictions set forth
herein and the
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legend referred to in subsection 17(c) below, PROVIDED that (i)
the Transferee effecting such transfer shall have certified to
the Corporation in writing that the condition set forth in the
preceding sentence has been met, and (ii) any certificate issued
to SHD or such Restricted Transferee to represent the balance of
any Restricted Securities not so transferred shall remain subject
to the Proxy and bear the legend set forth in subsection 17(c)
below.
(ii) SHD and any Restricted Transferee may transfer Restricted
Securities in a transaction not meeting the conditions set forth
in subsection 17(b)(i) above only on the condition that the
transferee of SHD or such Restricted Transferee shall have
delivered to RLD a Proxy and transfer restriction agreement in
the form attached hereto as Exhibit B (and shall be deemed to be
a "Restricted Transferee" for purposes of this Agreement).
(c) Any certificate representing restricted Securities issued to SHD or
any Restricted Transferee of SHD shall have endorsed thereon, in addition to any
other required legends, a legend in substantially the following form:
The securities represented by this certificate are subject to restrictions
on transfer and upon voting set forth in an Irrevocable Proxy dated
___________, 199_, delivered by the original holder of this certificate.
(d) This Agreement and the trust created hereby shall expire upon the
soonest to occur of (i) the written agreement of all holders of outstanding
Voting Trust Certificates and the Trustee, or (ii) the fifth anniversary of the
date hereof.
(e) In addition, this Agreement and the trust created hereby, and the
restrictions on voting and transfer provided in subsections 17(b) and (c) above
(as evidenced by any Proxy delivered to RLD hereunder or otherwise), shall
terminate and be of no further force and effect upon the earliest to occur of
the following:
(i) when RLD shall cease to be the beneficial owner of at least
920,000 shares of Common Stock or when SHD and any Restricted
Transferees of SHD shall cease to be the beneficial owners of an
aggregate of at least 230,000 shares of Common Stock (in each
case as adjusted for any stock dividend, stock split,
consolidation, reverse stock split, reclassification or other
similar transaction effected by the Corporation with respect to
its Common Stock after the date hereof);
(ii) upon the death of RLD;
(iii)the Corporation is acquired by way of the sale of all or
substantially all its assets or a merger or consolidation of the
Corporation with any other corporation or entity (other than a
merger or consolidation which would result in the voting
securities of the Corporation outstanding immediately prior
thereto continuing to represent, either by remaining outstanding
or by being converted into voting securities of the surviving
entity, more than 50% of the combined voting power of the voting
securities of the Corporation or such surviving entity
outstanding immediately after such merger or consolidation,
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or a merger or consolidation effected to implement a
recapitalization or reincorporation of the Corporation in which
no material change in voting control of the Corporation takes
place).
18. Notices and Distributions.
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(a) Unless otherwise specifically provided in this Agreement, any
notice to or communication with the holders of Voting Trust Certificates shall
be deemed to be sufficiently given or made if in writing and given by prepaid,
first class, registered or certified mail, or by a nationally recognized
overnight delivery service, or by personal delivery, to such holders at their
addresses appearing on the books of the Trustee. Any notice to the Trustee
hereunder shall be sufficient if in writing and given by first class, registered
or certified mail, or by a nationally recognized overnight delivery service, or
by personal delivery, as follows:
If to SHD:
Susan H. Daniels
33 Circuit Road
Brookline, Massachusetts 02167
If to RLD:
Robert L. Daniels
4 Heartbreak Hill
Ipswich, Massachusetts 01938
Every notice given shall in the case of mailing, or personal delivery, when
actually delivered and in the case of the effective, overnight delivery service,
on the business day following its dispatch by means of such service.
(b) All distributions of cash, securities or other property hereunder by
the Trustee to the holders of Voting Trust Certificates may be made, in the
discretion of the Trustee in person, by mail, or where appropriate, by wire
transfer to any bank or fund account of which the receiving holder has notified
the Trustee in the manner provided for herein.
19. Miscellaneous.
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(a) This Agreement shall be governed by, and construed and enforced in
accordance with, the substantive laws of The Commonwealth of Massachusetts,
without reference to its principles of conflict of law.
(b) If any provision of this Agreement shall be determined to be invalid,
illegal or otherwise unenforceable by any court of competent jurisdiction, the
validity, legality and enforceability of the other provisions of this Agreement
shall not be affected thereby. Any invalid, illegal or unenforceable provision
of this Agreement shall be severable, and after any such severance, all other
provisions hereof shall remain in full force and effect.
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(c) This Agreement shall be binding upon, and shall inure to the benefit
of, the parties hereto and their heirs, legal representatives, successors and
permitted assigns. This Agreement may not be assigned by any party without the
written consent of each other party.
(d) This Agreement and the documents referred to in it and to be delivered
pursuant to it constitute the entire agreement of the parties pertaining to its
subject matter and supersede all prior agreements, understandings negotiations
and discussions of the parties, whether written or oral, with respect to the
subject matter hereof.
(e) The headings contained in this Agreement are for reference only and
shall not affect the meaning or interpretation of this Agreement.
(f) This Agreement may be executed in two or more counterparts, each of
which shall be deemed an original, but all of which together shall constitute
one and the same agreement.
(g) The rights and remedies of the parties hereto shall be cumulative
and in addition to all other rights and remedies such parties may have, at law,
in equity, by contract or otherwise.
(h) The parties hereto agree to execute such further instruments and to
take such further actions as may reasonably be necessary to carry out the intent
of this Agreement.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as an
instrument under seal as of the date first above written.
/s/ ROBERT L. DANIELS
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Robert L. Daniels, individually
SUSAN H. DANIELS
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Susan H. Daniels
ROBERT L. DANIELS
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Robert L. Daniels, as Trustee
and not individually
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