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Exhibit 10.2
AGREEMENT, dated as of April 8, 1997, between POLYSINDO HONG KONG LIMITED,
a Hong Kong corporation ("Texmaco"), and DYERSBURG CORPORATION, a Tennessee
corporation (the "Company").
WHEREAS, contemporaneously with the execution and delivery of this
Agreement, Texmaco has entered into one or more Securities Purchase Agreements
dated the date hereof in connection with the purchase of 3,000,000 shares of the
common stock, $0.01 par value, of the Company from shareholders of the Company
party thereto (collectively, the "Purchase Agreement");
WHEREAS, it is a condition to Texmaco's obligation to consummate the
transactions contemplated by the Purchase Agreement, that this Agreement be
executed by the parties hereto;
WHEREAS, Texmaco is under common control with PT. Texmaco Jaya, an
Indonesian corporation ("Texmaco Jaya");
WHEREAS, it is the intention of the Company, Texmaco and Texmaco Jaya to
pursue strategic business relationships that will benefit each of their
respective shareholders;
WHEREAS, Texmaco Jaya hereby joins in this Agreement for the purpose of
being bound by its terms with the same effect as if it were named as Texmaco
herein; and
WHEREAS, the terms and conditions of this Agreement shall become effective
as to the parties hereto on such date (the "Effective Date") as the transactions
contemplated by the Purchase Agreement shall have been consummated.
NOW, THEREFORE, in consideration of the mutual covenants herein contained
and other valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the Company and Texmaco hereby agree as follows:
1. Definitions. For purposes of this Agreement, the following terms have
the meanings specified below:
"Acquired Shares" means any Shares held by Texmaco as of the date of this
Agreement or subsequently acquired by Texmaco or its Affiliates in compliance
with this Agreement.
"Affiliate" means any Person that directly or indirectly through one or
more intermediaries controls or is controlled by, or is under common control
with Texmaco; provided, that for purposes of this Agreement, the Company shall
not be deemed to be an Affiliate of Texmaco.
"Commission" means the United States Securities and Exchange Commission and
any successor federal agency having similar powers.
"Common Stock" means the common stock, $0.01 par value, of the Company.
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"Disinterested Members of the Board of Directors" means such members of the
Board of Directors of the Company that are not Affiliates of Texmaco or Texmaco
Jaya or designees of Texmaco pursuant to Section 5(a) or 5(b) hereof.
"Holder" means Texmaco and any of its Affiliates that beneficially own
Acquired Shares.
"Outstanding Common Stock" means, as of a given date, the number of shares
of outstanding Common Stock on such date on a fully diluted basis.
"Person" means an individual, a corporation, a partnership, an association,
a joint stock company, a trust, any unincorporated organization, or a government
or political subdivision thereof.
"Register," "registered," and "registration" refer to a registration
effected by preparing and filing a registration statement or similar document in
compliance with the Securities Act of 1933, as amended (the "1933 Act"), and the
automatic effectiveness or the declaration or ordering of effectiveness of such
registration statement or document.
"Registrable Securities" means the Acquired Shares and any Common Stock of
the Company issued as (or issuable upon the conversion or exercise of any
warrant, option, right, or other security which is issued as) a dividend or
other distribution with respect to, or in exchange for, or in replacement of,
the Acquired Shares; provided, however, that Registrable Securities shall not
include any shares of Common Stock which have been previously registered in
accordance with Section 4, or which have been sold to the public either pursuant
to a registration statement or Rule 144 promulgated under the 1933 Act, or which
have been sold in a private transaction in which the transferor's rights under
Section 4 have not been assigned.
"Registration Expenses" means all expenses incurred in effecting any
registration pursuant to this Agreement, including, without limitation, all
registration, qualification, and filing fees, printing expenses, escrow fees,
fees and disbursements of counsel for the Company, blue sky fees and expenses,
and expenses of any regular or special audits incident to or required by any
such registration, but shall not include Selling Expenses, fees and
disbursements of counsel for the Holders and the compensation of regular
employees of the Company, which shall be paid in any event by the Company.
"Selling Expenses" means all underwriting discounts, selling commissions
and stock transfer taxes applicable to the sale of Registrable Securities and
fees and disbursements of counsel for any Holder.
"Shares" means shares of Common Stock.
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"Transfer" of any Shares means to sell, assign, convey, pledge,
hypothecate, mortgage, gift or otherwise transfer or dispose of such Shares and
a "Transfer" (used as a noun) shall mean the act of Transferring.
2. Right of First Offer. (a) So long as this Agreement remains in effect,
neither Texmaco nor any of its Affiliates that holds Acquired Shares (Texmaco or
any such Affiliate being referred to herein as the "Transferor") will Transfer
all or any portion of the Acquired Shares without the prior written consent of
the Disinterested Members of the Board of Directors of the Company, to any
Person except pursuant to the provisions of Section 2(b) or 2(c) below.
(b) (i) Prior to any sale or offer of sale of any Acquired Shares,
the Transferor will give at least thirty (30) days' advance
written notice (the "Offer Notice") of such event to the
Company. The Offer Notice shall specify the number of
Acquired Shares which the Transferor desires to sell (the
"Offered Shares") and the purchase price in cash which such
Transferor proposes to receive for such Offered Shares.
During the thirty (30) day period following the Company's
receipt of the Offer Notice (the "Notice Period"), the
Company may give written notice to the Transferor (an
"Acceptance Notice") agreeing to purchase (or agreeing to
cause a Person designated by the Company to purchase) all
(but not less than all) of the Offered Shares for the
purchase price set forth in the Offer Notice or,
alternatively, the Company may give written notice (the
"Counter Offer Notice") offering to purchase (or to cause a
Person designated by the Company to purchase) all (but not
less than all) of the Offered Shares at a purchase price and
on such terms specified in the Counter Offer Notice. In the
event the Company delivers a Counter Offer Notice to the
Transferor during the Notice Period, both parties shall
negotiate diligently and in good faith during the Notice
Period to agree upon terms upon which the Transferor will
sell the Offered Shares to the Company, but nothing herein
shall obligate the parties to reach such an agreement.
(ii) In the event during the Notice Period the Company either
delivers an Acceptance Notice to the Transferor or the
Transferor and the Company (or its designee) agree to the
terms upon which the Company (or its designee) shall
purchase the Offered Shares, the Company (or its designee)
shall purchase, and the Transferor shall sell to the Company
(or its designee), the Offered Shares on the terms set forth
in the Acceptance Notice or on the terms negotiated, as the
case may be, at a closing to take place at a place and time
to be agreed to by the Transferor and the Company (or its
designee),
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but in no event shall such closing occur more than
seventy-five (75) days following termination of the Notice
Period.
(iii) If the Transferor does not receive an Acceptance Notice
during the Notice Period or if the Transferor and the
Company (or its designee) are unable to negotiate mutually
acceptable terms for the purchase by the Company (or its
designee) of the Offered Shares during the Notice Period,
the Transferor may, at any time within one hundred and
eighty (180) days following termination of the Notice
Period, sell all (but not less than all) of the Offered
Shares to a third party other than an Affiliate of the
Transferor for a purchase price in cash at least ten percent
(10%) greater than the highest purchase price offered by the
Company (or its designee) during the Notice Period. No
transfer of Offered Shares shall be made after the end of
said one hundred and eighty (180) day period without again
complying with the provisions of this Section 2.
(c) The following Transfers may be made by a Transferor without
compliance with Section 2(a) or 2(b):
(i) any Transfer by the Transferor to an Affiliate provided the
transferee agrees to be bound by the provisions of this
Agreement as if such transferee were originally named as
Texmaco herein by executing and delivering to the Company
the agreement set forth in Exhibit A hereto;
(ii) a Transfer pursuant to a bona fide pledge of or the granting
of a security interest or other lien or encumbrance in such
Acquired Shares to a lender to secure a bona fide loan,
guarantee or other financial support, and a Transfer
resulting from the foreclosure of such pledge or security
interest or other lien or encumbrance that may be placed
involuntarily upon any Acquired Shares, provided that, in
the instance of a foreclosure, the transferee or pledgee
agrees to be bound by the provisions of this Agreement as if
such transferee or pledgee were originally named as Texmaco
herein by executing and delivering to the Company the
Agreement set forth in Exhibit A hereto;
(iii) a Transfer pursuant to a tender offer, merger,
consolidation or similar transaction approved by the
Disinterested Members of the Board of Directors of the
Company; and
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(iv) a Transfer pursuant to a firm commitment underwritten public
sale of the Acquired Shares registered with the Commission
in accordance with the provisions of Section 4 hereof.
3. Restrictions on Other Transactions. In the event Texmaco and its
Affiliates shall not own more than fifty percent (50%) of the Outstanding Common
Stock on the date that is eighteen months following the Effective Date, neither
Texmaco nor any of its Affiliates will so long as this Agreement remains in
effect, directly or indirectly, without the prior written consent of the
Disinterested Members of the Board of Directors of the Company:
(a) acquire, or offer or propose to acquire, beneficial ownership of
any Shares or other securities of the Company (or direct or indirect rights
or options to acquire any securities of the Company), except by way of
stock dividends or other distributions made in respect of Acquired Shares;
(b) acquire or agree to acquire, by purchase or otherwise, control of
any Person which, prior to the time of such acquisition is publicly
disclosed (by filing with the Commission or otherwise), or is otherwise
known by Texmaco, to be the beneficial owner of more than 5% of the
Outstanding Common Stock; provided, however, that Texmaco may acquire such
control if it causes the Person to dispose of such Person's Common Stock as
soon as practicable after the acquisition of control by Texmaco;
(c) except for the purpose of assuring the election of the three
Texmaco designees to the Board of Directors to the extent contemplated by
Section 5 hereof, solicit proxies, seek to induce any other Person to
solicit proxies, or become a "participant" in a "solicitation" of proxies,
as those terms are defined in Item 4 of Schedule 14A and Rule 14a-1 under
the Securities Exchange Act of 1934, as amended (the "1934 Act"), in
respect of any shares of capital stock of the Company or call any
shareholders meeting or initiate or propose, or otherwise solicit
shareholders of the Company to approve or disapprove, any shareholder
proposal;
(d) enter into any shareholders' agreement or other agreement of
similar effect with respect to the ownership or disposition of any shares
of Common Stock of the Company or the voting of any shares of Common Stock
or the control of the Company, or deposit any securities in a voting trust
or subject such securities to a voting trust agreement or any other
agreement of similar effect with respect to the Company, other than, in
each such case, an agreement, voting trust or other arrangement involving
only Texmaco and its Affiliates;
(e) except for the purpose of assuring the election of the three
Texmaco designees to the Board of Directors to the extent contemplated by
Section 5 hereof, seek to advise, encourage or influence any person with
respect to the voting of any securities of the Company, or induce, attempt
to induce or in any manner assist any other Person in
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initiating any shareholder proposal or a tender or exchange offer for
securities of the Company or any change of control of the Company, or for
the purpose of convening a shareholders meeting of the Company;
(f) take any action (or permit any investment banker, attorney,
accountant or any other representative retained by Texmaco or of any of its
Affiliates to take any action), directly or indirectly, to (A) acquire or
affect control of the Company, (B) participate in, or encourage the
formation of, any Group (as defined in Rule 13d-5 under the 1934 Act) with
respect to any shares of capital stock of the Company (other than a Group
consisting solely of Texmaco and its Affiliates) or (C) initiate contact
with any Person in an effort to solicit, encourage or assist that Person in
any proposal for a merger or other business combination involving the
Company or for the acquisition of any of the Company's capital stock or any
of the Company's assets;
(g) make any public announcement or make any written or oral proposal
or invitation to discuss any possibility, intention, plan or arrangement,
relating to a tender or exchange offer for securities of the Company or a
business combination (or other similar transaction which would result in a
change of control), sale of assets, liquidation or other extraordinary
corporate transaction between Texmaco or any of its Affiliates and the
Company or take any action which might require the Company to make a public
announcement regarding any of the foregoing; or
(h) enter into any oral or written contract, arrangement or
understanding with respect to any of the foregoing.
4. Registration Rights.
4.1 Request for Registration.
(a) Subject to compliance with the provisions of Section 2(c)(iv)
hereof, if the Company shall receive at any time after April 4, 1998 a
written request from the Holders of the Registrable Securities then
outstanding and entitled to registration rights under this Section 4 (the
"Initiating Holders") that the Company effect the registration under the
1933 Act of at least 20% of the Registrable Securities then outstanding, or
a lesser percentage if the aggregate offering price of the Registrable
Securities for which a request has been made under this Section 4.1(a) is
expected to be at least $10,000,000, then the Company shall, within five
(5) days of the receipt thereof, give written notice of such request to all
Holders and shall, subject to the limitations of this Section 4.1, use its
best efforts to effect such a registration as soon as practicable by filing
a registration statement under the 1933 Act covering all the Registrable
Securities which the Holders shall in writing request (given within twenty
(20) days of receipt of the notice given by the Company pursuant to this
Section 4.1(a)) to be included in such registration and to use its best
efforts to have such registration statement become effective.
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(b) Notwithstanding the foregoing, the Company shall not be obligated
to effect the filing of a registration statement pursuant to this Section
4.1 (i) if the Initiating Holders do not request that such offering be
firmly underwritten by underwriters reasonably acceptable to the Company,
(ii) if the Company and the Initiating Holders are unable to obtain the
commitment of the underwriter(s) described in (i) above to firmly
underwrite the offering, or (iii) during the period starting with the date
60 days prior to the Company's good faith estimate of the date of filing
of, and ending on a date 180 days following the effective date of, a
registration statement pertaining to the underwritten public offering of
securities for the account of the Company. If the Company shall furnish to
Holders requesting a registration statement pursuant to this Section 4.1 a
certificate signed by the President of the Company stating that in the good
faith judgment of the Disinterested Members of the Board of Directors of
the Company, it would be seriously detrimental to the Company and its
shareholders generally for such registration statement to be filed, the
Company shall have the right to defer such filing for a period of not more
than 180 days after receipt of the request of the Initiating Holders;
provided, however, that the Company may not utilize such right more than
twice in any eighteen-month period.
(c) The right of any Holder to include its Registrable Securities in
such registration shall be conditioned upon such Holder's participation in
the underwriting and the inclusion of such Holder's Registrable Securities
in the underwriting to the extent provided herein. All Holders proposing to
distribute their securities through such underwriting shall (together with
the Company as provided in Section 4.4(d)) enter into an underwriting
agreement in the usual and customary form for similar transactions with the
managing underwriter or underwriters selected for such underwriting.
Notwithstanding any other provision of this Section 4.1, if, in the case of
a registration requested pursuant to Section 4.1(a), the managing
underwriter advises the Initiating Holders and the Company in writing that
marketing factors require a limitation of the number of Shares to be
underwritten, then the Initiating Holders shall so advise the Company and
all Holders of Registrable Securities which would otherwise be underwritten
pursuant hereto, and the number of Registrable Securities that may be
included in the underwriting shall be allocated pro rata among all Holders
thereof desiring to participate in such underwriting (according to the
number of Registrable Securities then held by each Holder). No Registrable
Securities requested by a Holder to be included in a registration pursuant
to Section 4.1(a) shall be excluded from the underwriting unless all
securities other than Registrable Securities are first excluded.
(d) The Company is obligated to effect only two registrations pursuant
to Section 4.1(a); provided, however, that no registration of Registrable
Securities which shall not have become and remained effective in accordance
with Section 4.4 hereof shall be included in the calculation of the number
of registrations contemplated by this Section 4.1.
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4.2 Company Registration. At any time after April 4, 1998, if (but without
any obligation to do so) the Company proposes to register for its own account
any of its Common Stock under the 1933 Act in connection with the public
offering of such Common Stock solely for cash (other than a registration on Form
S-8 or any successor form relating solely to the sale of securities to
participants in a Company stock plan, or a registration on Form S-4 or any
successor form), the Company shall, at such time, promptly give each Holder
written notice of such registration. Upon the written request of any Holder
given within twenty (20) days after mailing of such notice by the Company, the
Company shall, subject to the provisions of Section 4.7, use its best efforts to
cause a registration statement covering all of the Registrable Securities that
each such Holder has requested to be registered to become effective under the
1933 Act. Any Holder who elects to participate in such a registration may
withdraw such election within two (2) business days prior to the registration
statement therefor becoming effective by providing written notice to the
Company.
4.3 Form S-3 Registration. In case the Company shall receive from any
Holder or Holders at any time on or after April 4, 1998 a written request or
requests that the Company effect a registration on Form S-3 and any related
qualification or compliance with respect to all or a part of the Registrable
Securities owned by such Holder or Holders, the Company, subject to compliance
with the provisions of Section 2(c)(iv) hereof, will:
(a) promptly give written notice of the proposed registration, and any
related qualification or compliance, to all other Holders; and
(b) use its best efforts to effect, as soon as practicable, such
registration, qualification or compliance as may be so requested and as
would permit or facilitate the sale and distribution of all or such portion
of such Holder's or Holders' Registrable Securities as are specified in
such request, together with all or such portion of the Registrable
Securities of any other Holder or Holders joining in such request as are
specified in a written request given within twenty (20) days after receipt
of such written notice from the Company; provided, however, that the
Company shall not be obligated to effect any such registration,
qualification or compliance pursuant to this Section 4.3 if: (1) Form S-3
is not available for such offering by the Holders; (2) the aggregate net
offering price (after deduction of underwriting discounts and commissions)
of the Registrable Securities specified in such request does not exceed
$3,000,000; (3) the Company has already effected one registration on Form
S-3 within the previous twelve-month period; (4) the Company has already
effected three registrations on Form S-3 pursuant to this Section 4.3; or
(5) the Company shall furnish to the Holders a certificate signed by the
President of the Company stating that in the good faith judgment of the
Board of Directors of the Company, it would be seriously detrimental to the
Company and its shareholders for such Form S-3 registration to be effected
at such time, in which event the Company shall have the right to defer the
filing of the Form S-3 registration for a period of not more than 180 days
after receipt of the request of the Holder or Holders under this Section
4.3;
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provided, however, that the Company shall not utilize this right more than
twice in any eighteen-month period.
4.4 Obligations of the Company. Whenever required under this Section 4 to
use its best efforts to effect the registration of any Registrable Securities,
the Company shall, as expeditiously as reasonably possible, prepare and file
with the Commission a registration statement with respect to such Registrable
Securities and use its best efforts to cause such registration statement to
become effective, and, upon the request of the Holders of a majority of the
Registrable Securities registered thereunder, keep such registration statement
effective for up to 45 days or until the Holders have informed the Company in
writing that the distribution of their securities has been completed, whichever
first occurs; and shall:
(a) Prepare and file with the Commission such amendments and
supplements to such registration statement and the prospectus used in
connection with such registration statement, and use its best efforts to
cause each such amendment to become effective, as may be necessary to
comply with the provisions of the 1933 Act with respect to the disposition
of all securities covered by such registration statement; provided,
however, that at least seven (7) days prior to filing a registration
statement, prospectus or any amendments or supplements thereto, including
documents incorporated by reference after the initial filing of the
registration statement, the Company shall furnish to the Holders of the
Registrable Shares covered by such registration statement, such Holders'
counsel and the underwriters draft copies of all such documents proposed to
be filed.
(b) Furnish to the Holders such reasonable number of copies of a
prospectus, including a preliminary prospectus, in conformity with the
requirements of the 1933 Act, and such other documents as they may
reasonably request in order to facilitate the disposition of Registrable
Securities owned by them.
(c) Use its best efforts to register or qualify the securities covered
by such registration statement under such other securities or Blue Sky laws
of such jurisdictions as shall be reasonably requested by the Holders
provided that the Company shall not be required in connection therewith or
as a condition thereto to qualify to do business or to file a general
consent to service of process in any such states or jurisdictions.
(d) Enter into and perform its obligations under an underwriting
agreement, in the usual and customary form for similar transactions, with
the managing underwriter or underwriters of such offering. Each Holder
participating in such underwriting shall also enter into and perform its
obligations under such an agreement, including furnishing any opinion of
counsel or entering into a lock-up agreement in the usual or customary form
for similar transactions, requested by the managing underwriter or
underwriters.
(e) Notify each Holder of Registrable Securities covered by such
registration statement, at any time when a prospectus relating thereto
covered by such registration
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statement is required to be delivered under the 1933 Act, of the happening
of any event as a result of which the prospectus included in such
registration statement, as then in effect, includes an untrue statement of
a material fact or omits to state a material fact required to be stated
therein or necessary to make the statements therein not misleading in the
light of the circumstances then existing and promptly file such amendments
and supplements which may be required pursuant to subparagraph (b) of this
Section 4.4 on account of such event and use its best efforts to cause each
such amendment and supplement to become effective.
(f) Furnish, at the request of any Holder requesting registration of
Registrable Securities pursuant to this Section 4, on the date that such
Registrable Securities are delivered to the underwriters for sale in
connection with a registration pursuant to this Section 4, if such
securities are being sold through underwriters, (i) an opinion or opinions,
dated such date, of the counsel representing the Company for the purposes
of such registration, in form and substance as is customarily given by
company counsel to the underwriters in an underwritten public offering,
addressed to the underwriters, if any, and (ii) a letter dated such date,
from the independent certified public accountants of the Company, in form
and substance as is customarily given by independent certified public
accountants to underwriters in an underwritten public offering, addressed
to the underwriters, if any.
(g) Make available at reasonable times for inspection by Holders of
Registrable Securities covered by such registration statement, and the
underwriters, and any attorney, accountant or other agent retained by any
such Holder or underwriter, all pertinent financial and other records, and
pertinent corporate documents and properties of the Company, and cause the
Company's officers, directors, employees, independent accountants and other
agents to supply all information reasonably requested by any such Holder,
underwriter, attorney, accountant or agent in connection with such
registration statement.
(h) Notify each Holder of Registrable Securities to be included in
such registration statement of any request by the Commission for the
amending or supplementing of such registration statement or for additional
information.
(i) Cause all Registrable Securities to be listed on the New York
Stock Exchange or such other exchange on which the Common Stock may be
listed at the time of registration.
(j) In connection with an underwritten offering pursuant to Section
4.1(a) or Section 4.3, participate, to the extent reasonably requested by
the managing underwriter for the offering, in customary efforts to sell the
securities under the offering, including, without limitation, participating
in "road shows."
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4.5 Furnish Information. It shall be a condition precedent to the
obligations of the Company to take any action pursuant to this Section 4 in
respect of the Registrable Securities of any selling Holder that such selling
Holders shall furnish to the Company such information regarding themselves, the
Registrable Securities held by them, and the intended method of disposition of
such securities as shall be required to effect the registration of their
Registrable Securities.
4.6 Expenses of Registration. All Registration Expenses and Selling
Expenses incurred in connection with any registration, qualification or
compliance pursuant to Section 4.1(a) or Section 4.3 shall be borne by the
Holders pro rata on the basis of the number of Shares so registered on their
behalf. All Registration Expenses incurred in connection with any registration,
qualification or compliance pursuant to Section 4.2 hereof shall be borne by the
Company and all Selling Expenses relating to securities so registered for the
benefit of the Holders shall be borne by the Holders pro rata on the basis of
the number of Shares so registered on their behalf.
4.7 Underwriting Requirements. In connection with any offering involving an
underwriting of securities being issued by the Company, the Company shall not be
required under Section 4.2 to include any of the Holders' securities in such
underwriting unless they accept the terms of the underwriting as agreed upon
between the Company and the underwriters selected by it (which terms shall
include such representations and warranties by the Holders and such other terms
and provisions as are customarily contained in such underwriting agreements). If
the managing underwriter for the offering shall advise the Company in writing
that the total amount of securities, including Registrable Securities, requested
by Holders to be included in such offering exceeds the amount of securities to
be sold other than by the Company that can be successfully offered, then the
Company shall be required to include in the offering only that number of such
securities, including Registrable Securities, which the managing underwriter
reasonably believes will not jeopardize the success of the offering (the
securities so included to be reduced as follows: all securities other than those
to be included by the Company for its own account that may be included in the
underwriting shall be reduced pro rata among the selling Holders in accordance
with the number of shares held by such Holder).
4.8 Indemnification. In the event any Registrable Securities are included
in a registration statement under this Section 4:
(a) The Company will indemnify and hold harmless each Holder, the
officers, directors, partners, agents and employees of each Holder, any
underwriter (as defined in the 1933 Act) and each person, if any, who
controls such Holder or underwriter within the meaning of the 1933 Act or
the 1934 Act, against any losses, claims, damages, or liabilities (joint or
several) to which they may become subject under the 1933 Act, the 1934 Act
or other federal or state law, insofar as such losses, claims, damages, or
liabilities (or actions in respect thereof) arise out of or are based upon
any of the following statements, omissions or violations (each, a
"Violation"): (i) any untrue statement or alleged untrue statement of a
material fact contained in such registration statement,
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including any preliminary prospectus or final prospectus contained therein
or any amendments or supplements thereto, (ii) the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein, in light of the circumstances in
which they were made, not misleading, or (iii) any violation or alleged
violation by the Company of the 1933 Act, the 1934 Act, any state
securities law or any rule or regulation promulgated under the 1933 Act,
the 1934 Act or any state securities law in connection with any matter
relating to such registration statement. The Company will reimburse each
such Holder, officer, director, partner, agent, employee, underwriter or
controlling person for any legal or other expenses reasonably incurred by
them in connection with investigating or defending any such loss, claim,
damage, liability, or action. The indemnity agreement contained in this
subsection 4.8(a) shall not apply to amounts paid in settlement of any
loss, claim, damage, liability, or action if such settlement is effected
without the consent of the Company (which consent shall not be unreasonably
withheld), nor shall the Company be liable to a Holder in any such case for
any such loss, claim, damage, liability, or action (i) to the extent that
it arises out of or is based upon a Violation which occurs in reliance upon
and in conformity with written information furnished expressly for use in
connection with such registration by or on behalf of such Holder,
underwriter or controlling person or (ii) in the case of a sale directly by
a Holder of Registrable Securities (including a sale of such Registrable
Securities through any underwriter retained by such Holder to engage in a
distribution solely on behalf of such Holder), such untrue statement or
alleged untrue statement or omission or alleged omission was contained in a
preliminary prospectus and corrected in a final or amended prospectus, and
such Holder failed to deliver a copy of the final or amended prospectus at
or prior to the confirmation of the sale of the Registrable Securities to
the person asserting any such loss, claim, damage or liability in any case
where such delivery is required by the 1933 Act.
(b) Each Holder will, if Registrable Securities held by such Holder
are included in the securities as to which such registration,
qualification, or compliance is being effected, indemnify and hold harmless
the Company, each of its directors, each of its officers who have signed
the registration statement, each person, if any, who controls the Company
within the meaning of the 1933 Act, each agent and any underwriter for the
Company, and any other Holder selling securities in such registration
statement or any of its directors, officers, partners, agents or employees
or any person who controls such Holder or underwriter, against any losses,
claims, damages, or liabilities (joint or several) to which the Company or
any such director, officer, controlling person, agent, or underwriter or
controlling person, or other such Holder or director, officer or
controlling person may become subject, under the 1933 Act, the 1934 Act or
other federal or state law, insofar as such losses, claims, damages or
liabilities (or actions in respect thereto) arise out of or are based upon
any Violation, in each case to the extent (and only to the extent) that
such Violation occurs in reliance upon and in conformity with written
information furnished by or on behalf of such Holder expressly for use in
connection with such registration; and each such Holder will reimburse any
legal or other expenses
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reasonably incurred by the Company or any such director, officer,
controlling person, agent or underwriter or controlling person, other
Holder, officer, director, partner, agent, employee, or controlling person
in connection with investigating or defending any such loss, claim, damage,
liability, or action; provided, however, that the liability of any Holder
hereunder shall be limited to the amount of gross proceeds received by such
Holder in the offering giving rise to the Violation; and provided further
that the indemnity agreement contained in this subsection 4.8(b) shall not
apply to amounts paid in settlement of any such loss, claim, damage,
liability or action if such settlement is effected without the consent of
the Holder, which consent shall not be unreasonably withheld nor, in the
case of a sale directly by the Company of its securities (including a sale
of such securities through any underwriter retained by the Company to
engage in a distribution solely on behalf of the Company), shall the Holder
be liable to the Company in any case in which such untrue statement or
alleged untrue statement or omission or alleged omission was contained in a
preliminary prospectus and corrected in a final or amended prospectus, and
the Company failed to deliver a copy of the final or amended prospectus at
or prior to the confirmation of the sale of the securities to the person
asserting any such loss, claim, damage or liability in any case where such
delivery is required by the 1933 Act.
(c) Promptly after receipt by an indemnified party under this Section
4.8 of notice of the commencement of any action (including any governmental
action), such indemnified party will, if a claim in respect thereof is to
be made against any indemnifying party under this Section 4.8, deliver to
the indemnifying party a written notice of the commencement thereof and the
indemnifying party shall have the right to participate in, and, to the
extent the indemnifying party so desires, jointly with any other
indemnifying party similarly noticed, to assume and control the defense
thereof with counsel mutually satisfactory to the parties; provided,
however, that an indemnified party shall have the right to retain its own
counsel, with the fees and expenses to be paid by the indemnifying party,
if representation of such indemnified party by the counsel retained by the
indemnifying party would be inappropriate due to actual or potential
differing interests, as reasonably determined by either party, between such
indemnified party and any other party represented by such counsel in such
proceeding; and provided further that, in any event, the indemnified party
shall have the right to retain its own counsel at its own expense, and such
counsel shall be permitted to participate reasonably in the proceedings.
The failure to deliver written notice to the indemnifying party within a
reasonable time of the commencement of any such action, if prejudicial to
its ability to defend such action, shall relieve such indemnifying party of
any liability to the indemnified party under this Section 4.8 to the extent
of such prejudice, but the omission so to deliver written notice to the
indemnifying party will not relieve it of any liability that it may have to
any indemnified party otherwise than under this Section 4.8.
(d) If the indemnification provided for in this Section 4.8 is
unavailable to a party that would have been an indemnified party under such
Section in respect of any losses, claims, damages or liabilities (or
actions or proceedings in respect thereof) referred
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to therein, then each party that would have been an indemnifying party
thereunder shall, in lieu of indemnifying such indemnified party,
contribute to the amount paid or payable by such indemnified party as a
result of such losses, claims, damages or liabilities (or actions or
proceedings in respect thereof) in such proportion as is appropriate to
reflect the relative fault of such indemnifying party on the one hand and
such indemnified party on the other in connection with the statements or
omissions which resulted in such losses, claims, damages or liabilities (or
actions or proceedings in respect thereof). The relative fault shall be
determined by reference to, among other things, whether the Violation
relates to information supplied by such indemnifying party or such
indemnified party and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such Violation. The
parties agree that it would not be just and equitable if contribution
pursuant to this Section 4.8(d) were determined by pro rata allocation or
by any other method of allocation which does not take account of the
equitable considerations referred to in the preceding sentence. The amount
paid or payable by a contributing party as a result of the losses, claims,
damages or liabilities (or actions or proceedings in respect thereof)
referred to above in this Section 4.8(d) shall include any legal or other
expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. No person guilty of
fraudulent misrepresentation (within the meaning of Section 10(f) of the
1933 Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. The liability of any Holder of
Registrable Securities in respect of any contribution obligation of such
Holder arising under this Section 4.8(d) shall not in any event exceed an
amount equal to the gross proceeds to such Holder from the disposition of
the Registrable Securities disposed of by such Holder pursuant to such
registration.
4.9 Choice of Managing Underwriter. With respect to any registration
effected pursuant to Sections 4.1(a), 4.2 or 4.3, the Company shall be entitled
to choose the managing underwriter or underwriters of the offering to which such
registration applies; provided that the selection of such underwriter(s) shall
be reasonably acceptable to the Holders of Registrable Securities being included
in such registration.
4.10 Assignment of Registration Rights. The rights to cause the Company to
register Registrable Securities pursuant to this Section 4 may be assigned in
whole or in part by any Holder to any transferee provided such transferee (i)
acquires from the Holder Registrable Securities representing at least 3% of the
Company's Outstanding Common Stock, and (ii) shall (a) as a condition to such
transfer, deliver to the Company a written instrument by which such transferee
agrees to be bound by the obligations imposed upon Holders under this Agreement
to the same extent as if she, he or it were a Holder under this Agreement and
(b) be deemed to be a Holder hereunder.
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5. Board of Directors; Approval of Transactions.
(a) Promptly following the Effective Date, the Company's Board of
Directors shall fill the vacancies created on the Board of Directors by the
resignations of John D. Howard, Julius Koppelman and Daniel W. Miller with
three designees of Texmaco. The Texmaco designees shall be senior executive
officers of Texmaco Jaya or its Affiliates reasonably acceptable to the
Chairman of the Company's Board of Directors. The Disinterested Members of
the Board of Directors shall, subject to the remaining provisions of this
Section 5 and to fulfilling applicable fiduciary duties, recommend each of
the Texmaco designees for election at each annual meeting of the Company's
shareholders at which each such designee shall stand for election. Texmaco
shall provide the Company with notice of the Texmaco designee not later
than 120 days prior to the scheduled date for the ensuing annual meeting.
In the absence of timely designation from Texmaco, the Texmaco designee
then serving whose term is expiring shall be renominated if still eligible
to serve.
(b) Texmaco shall be entitled to name a new designee to fill any
vacancy on the Board of Directors created by the resignation, removal,
incapacity or death of a Texmaco designee. The Disinterested Members of the
Board of Directors shall, subject to the remaining provisions of this
Section 5 and to applicable fiduciary duties, vote to fill such vacancy
with the new Texmaco designee.
(c) At such time, if ever, as Texmaco and its Affiliates own less than
20% but at least 15% of the Outstanding Common Stock, Texmaco shall only be
entitled to two designees to the Board of Directors. At such time, if ever,
as Texmaco and its Affiliates own less than 15% but at least 10% of the
Outstanding Common Stock, Texmaco shall only be entitled to one designee to
the Board of Directors. At such time, if ever, as Texmaco and its
Affiliates own less than 10% of the Outstanding Common Stock, Texmaco shall
not be entitled to any designees to the Board of Directors. Immediately
upon the occurrence of any such event, Texmaco shall cause the appropriate
number of its designees to resign from the Company's Board of Directors and
the obligations of the Disinterested Members of the Board of Directors
pursuant to Section 5(a) and the rights afforded to Texmaco pursuant to
Section 5(b) shall be adjusted accordingly.
(d) Texmaco will, and will cause its Affiliates to, vote any shares of
Common Stock beneficially owned by any of them in accordance with the
recommendation of the Disinterested Members of the Board of Directors with
respect to the election of directors. Texmaco shall use its best efforts to
cause the Company's Board of Directors to include four members who are not
Affiliates of Texmaco or its Affiliates. Texmaco agrees that any
transaction between the Company and Texmaco or its Affiliates shall be on
terms no less favorable than those which would be obtained from
unaffiliated parties in an arms' length transaction and must be approved by
the Disinterested Members of the Board of Directors. Notwithstanding the
foregoing, transactions in the ordinary course of business
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on terms no less favorable than could be obtained from unaffiliated parties
when the size of the transaction or group of related transactions does not
exceed $1,000,000 shall be permitted without requiring the prior approval
of the Disinterested Members of the Board of Directors.
(e) So long as Texmaco or its Affiliates beneficially own Common
Stock, Texmaco or such Affiliate shall be present, in person or by proxy,
at all meetings of shareholders of the Company so that all Common Stock
beneficially owned by Texmaco or any Affiliate may be counted for the
purpose of determining the presence of a quorum at such meeting.
(f) Notwithstanding the foregoing, if Texmaco and its Affiliates
acquire more than 50% of the Outstanding Common Stock on or before the date
that is eighteen months following the Effective Date, then immediately upon
such acquisition subsections 5(a), (b) and (d) shall no longer be
applicable to the parties except as follows:
(i) Texmaco shall continue to use its best efforts to cause the
Company's Board of Directors to include at least four Disinterested
Members of the Board of Directors;
(ii) Texmaco agrees that any transaction between the Company and
Texmaco or its Affiliates shall be on terms no less favorable than
those which would be obtained from unaffiliated parties in arms'
length transactions and must be approved by the Disinterested Members
of the Board of Directors; provided, however, that transactions in the
ordinary course of business on terms no less favorable than could be
obtained from unaffiliated parties when the size of the transaction or
group of related transactions does not exceed $1,000,000 shall be
permitted without requiring the prior approval of the Disinterested
Members of the Board of Directors; and
(iii) Texmaco agrees that three of its representatives to the
Board of Directors shall be senior executive officers of Texmaco Jaya
or its Affiliates.
6. Participation Rights in Connection with Future Issuances by the Company.
(a) Subject to the remaining provisions of this Section 6, in the
event the Company shall issue additional shares of Common Stock or
securities convertible into or exchangeable for Common Stock (collectively,
"Additional Securities"), Texmaco shall have the right to purchase
Additional Securities in that amount necessary to enable Texmaco to
maintain its percentage ownership in the Outstanding Common Stock
immediately preceding such issuance by the Company. If and when Section 3
becomes applicable to Texmaco and its Affiliates, Texmaco shall continue to
have the right to purchase Additional Securities under this Section 6.
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(b) If the Company proposes to undertake an issuance of Additional
Securities, it shall give Texmaco written notice of its intention
describing the type of Additional Securities, the anticipated price, the
amount of Additional Securities to be issued, and the general terms and
conditions upon which the Company proposes to issue the same. Except as
hereinafter provided in this Section 6(b), the notice shall provide that
Texmaco shall have twenty (20) days from the giving of such notice to agree
to purchase Additional Securities by giving written notice to the Company
and stating therein the amount of Additional Securities to be purchased by
Texmaco. The parties agree that in the event of the proposed issuance of
Additional Securities in connection with (i) a firm commitment underwritten
public offering, the Company shall provide Texmaco written notice of such
proposed issuance at least ten (10) days prior to the filing of the
registration statement with the Commission with respect to such issuance
and Texmaco shall have ten (10) days following the date of such filing to
notify the Company of the amount of Additional Securities to be purchased
by Texmaco, (ii) an acquisition (whether by merger or otherwise) by the
Company or any of its subsidiaries of the stock or assets of another
company (an "Acquisition") or a private placement of senior or subordinated
indebtedness of the Company (a "Financing"), the Company shall provide
Texmaco with the anticipated terms of such Acquisition or Financing,
including the amount of Additional Securities anticipated to be issued in
connection therewith, and Texmaco shall have twenty (20) days from such
date to notify the Company of the quantity of Additional Securities to be
purchased by Texmaco.
(c) Except as hereinafter provided in this Section 6(c), any
Additional Securities purchased by Texmaco hereunder shall be purchased for
the price and upon the terms and conditions upon which the Company issues
the Additional Securities to a third party. In the event of a firm
commitment underwritten public offering, the price to be paid by Texmaco
for the Additional Securities it elects to purchase shall be the price to
the public as reflected in the registration statement relating thereto. In
the event the Company shall issue Additional Securities consisting of
securities convertible into or exchangeable for Common Stock, the option
price, conversion price or exchange ratio for such Additional Securities as
Texmaco shall elect to purchase hereunder shall be based on the greater of
such price or ratio as specified in the Company's notice or the fair market
value of the Common Stock (as hereinafter defined). In the event the
Company shall issue Additional Securities in connection with an Acquisition
or a Financing, the price to be paid by Texmaco for the Additional
Securities it elects to purchase shall be based on the fair market value of
the Common Stock.
(d) The right to purchase Additional Securities set forth in this
Section 6 shall not apply to (i) stock dividends, stock splits,
recapitalizations or other subdivisions of shares of Common Stock, (ii)
shares of Common Stock or related options exercisable for capital stock of
the Company issued to employees, officers and directors of, and consultants
to, the Company pursuant to the 1992 Stock Incentive Plan, or (iii) stock
issued pursuant to any rights or agreement, including, without limitation,
convertible
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securities, options and warrants, provided that the rights established by
this Section 6 apply with respect to the initial grant or sale by the
Company of such rights or agreement.
(e) If Texmaco fails to exercise the rights provided in this Section 6
within the applicable time periods provided for herein, the Company shall
have one hundred and eighty (180) days thereafter to sell the Additional
Securities at a price and upon general terms and conditions not materially
more favorable to the purchasers thereof than specified in the Company's
notice pursuant to Section 6(b) above. If the Company has not sold the
Additional Securities within such one hundred and eighty (180) days, the
Company shall not thereafter issue or sell any Additional Securities
without first complying with the provisions of this Section 6.
(f) For purposes of this Section 6, "fair market value of the Common
Stock" means, as of any date, the average of the reported closing sale
price of the Common Stock on the New York Stock Exchange for the twenty
(20) trading days which end five (5) days prior to such date.
7. Representations and Warranties of the Company. The Company represents
and warrants to Texmaco as follows:
(a) No Undisclosed Restrictions. To the Company's knowledge, the
Shares purchased by Texmaco pursuant to the Purchase Agreement are not
subject to any holding period, right of first refusal, voting rights
restrictions or any restrictions with respect to their transferability,
other than restrictions on transfer under applicable securities laws and as
expressly set forth in this Agreement. The provisions of the Tennessee
Control Share Acquisition Act are not applicable to the Company and the
Company's Board of Directors has approved the transactions contemplated by
the Purchase Agreement in accordance with the provisions of the Tennessee
Business Combination Act.
(b) No Conflict. The execution and delivery of this Agreement do not,
and the consummation of the transactions contemplated hereby and by the
Purchase Agreement will not (i) result in a violation of, or require any
authorization, approval, consent or other action by, or registration or
filing with, any court or administrative or governmental body pursuant to
any statute, law or regulation applicable to the Company, or (ii) conflict
with or result in a breach or default under any contract or agreement of
the Company to which the Shares are subject.
8. Termination of this Agreement. Unless otherwise specified, this
Agreement, and the respective rights and obligations of the parties hereto,
shall terminate upon the earlier of:
(a) the execution and delivery by the Company and the Parties (as
hereinafter defined) of a written agreement terminating this Agreement, or
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(b) the sale of all Acquired Shares pursuant to Section 2(a), 2(b),
2(c)(iii) or 2(c)(iv) hereof.
The "Parties" shall mean (i) Texmaco unless Texmaco has Transferred all of
its interest in Acquired Shares in a Transfer permitted by this Agreement and
(ii) any subsequent transferee pursuant to Section 2(c)(i) or Section 2(c)(ii)
hereof.
9. Assignment; Benefit. This Agreement and all of the provisions hereof
shall be binding upon and shall inure to the benefit of the parties hereto and
their respective heirs assigns, executors, administrators, or successors.
10. Governing Law. This Agreement shall be construed in accordance with and
governed by the laws of the State of Tennessee applicable to agreements made and
to be performed wholly within that jurisdiction. Each of the parties hereto
hereby irrevocably and unconditionally consents to submit to the exclusive
jurisdiction of the courts of the United States of America located in the State
of Georgia for any litigation arising out of or relating to this Agreement and
the transactions contemplated hereby (and agrees not to commence any litigation
relating thereto except in such courts), and further agrees that service of any
process, summons, notice, or document by U.S. registered mail to its respective
address set forth in Section 11 shall be effective service of process for any
litigation brought against it in any court. Each of the parties hereto
irrevocably and unconditionally waives any objection to the laying of venue in
any litigation arising out of this Agreement or the transactions contemplated
hereby in the courts of the United States of America located in the State of
Georgia and hereby further irrevocably and unconditionally waives and agrees not
to plead or claim in any such court that any such litigation brought in any such
court has been brought in an inconvenient forum.
11. Notices. All notices, consents, requests, instructions, approvals or
other communications required or permitted hereunder shall be in writing and
shall be validly given if delivered personally or when sent by registered or
certified mail addressed as follows:
If to the Company, to:
Dyersburg Corporation
1315 Phillips Street
Dyersburg, Tennessee 38024-0767
Attention: President
With a copy to:
Bass, Berry & Sims PLC
2700 First American Center
Nashville, Tennessee 37238
Attention: J. Page Davidson
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If to Texmaco, to:
c/o PT. Texmaco Jaya
Sentra Mulia Suite 1008, 10th Floor
JI H.R. Rasuna Said Kay, X-6 No. 8
Jakarta 12940, Indonesia
Attention: P. Manohar
With a copy to:
Alston & Bird
1201 West Peachtree Street
Atlanta, Georgia 30309-3424
Attention: B. Harvey Hill, Jr.
or to such other address as such party may indicate by a notice delivered to the
other party hereto. Notice given by mail as set forth above shall be deemed
delivered five days after the date the same is postmarked. With respect to
transferee Parties, all notices or other communications shall be delivered to
the address specified in the relevant agreement in the form of Exhibit A whereby
the transferee became bound by the provisions of this Agreement.
12. Entire Agreement; Integration. This Agreement supersedes all prior
agreements between or among any of the parties hereto with respect to the
subject matter contained herein and therein, and such Agreement embodies the
entire understanding among the parties relating to such subject matter.
13. Injunctive Relief. Each of the parties hereto acknowledges that in the
event of a breach by any of them of any material provision of this Agreement,
the aggrieved party may be without an adequate remedy at law. Each of the
parties therefore agrees that in the event of such a breach hereof the aggrieved
party may elect to institute and prosecute proceedings in any court of competent
jurisdiction set forth in Section 10 herein, to enforce specific performance or
to enjoin the continuing breach hereof. By seeking or obtaining any such relief,
the aggrieved party shall not be precluded from seeking or obtaining any other
relief to which it may be entitled.
14. Transfer of Shares; Legend. Texmaco understands and agrees that the
Shares acquired pursuant to the Purchase Agreement have not been registered
under the 1933 Act or the securities laws of any state. Accordingly, Texmaco
agrees to transfer any Acquired Shares held by it only in full compliance with
the terms and conditions of this Agreement and with the 1933 Act. The
certificates representing the Acquired Shares shall state therein:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE
ARE SUBJECT TO THE PROVISIONS OF AN AGREEMENT
DATED AS OF APRIL 8, 1997 BETWEEN THE COMPANY
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AND PT. TEXMACO JAYA, A COPY OF WHICH IS ON FILE
AT THE OFFICES OF THE COMPANY.
THE SECURITIES REPRESENTED BY THIS CERTIFICATE
HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933 OR THE SECURITIES LAWS OF ANY STATE
AND MAY NOT BE SOLD OR OTHERWISE DISPOSED OF
EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT UNDER SUCH ACT AND APPLICABLE STATE
SECURITIES LAWS OR AN APPLICABLE EXEMPTION TO
THE REGISTRATION REQUIREMENTS OF SUCH ACT OR
SUCH LAWS.
In addition, Texmaco shall cause to be presented promptly all certificates
representing Shares hereafter acquired by Texmaco or its Affiliates, for the
placement thereon of the above legend. The Company may enter a stop transfer
order with the transfer agent or agents of the Shares against the transfer of
Shares except in compliance with the requirements of this Agreement.
15. Section Headings. Section headings are for convenience of reference
only and shall not affect the meaning of any provision of this Agreement.
16. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be an original, and all of which shall
together constitute one and the same instrument. All signatures need not be on
the same counterpart.
17. Severability. If any provision of this Agreement shall be invalid or
unenforceable, such invalidity or unenforceability shall not affect the validity
and enforceability of the remaining provisions of this Agreement, unless the
result thereof would be unreasonable, in which case the parties hereto shall
negotiate in good faith as to appropriate amendments hereto.
18. Amendment and Waiver. This Agreement may be amended, and the observance
of any term hereof may be waived, with (and only with) the written consent of
the Company and the parties hereto. No such amendment or waiver will extend to
or affect any obligation, covenant or agreement not expressly amended or waived
or impair any right consequent thereon. No course of dealing between the Company
and Texmaco (or any other Parties) nor any delay in exercising any rights
hereunder shall operate as a waiver of any rights hereunder.
19. Filing. A copy of this Agreement and of all amendments hereto shall be
filed at the principal executive office of the Company.
20. Attorney's Fees. In any action or proceeding brought to enforce any
provision of this Agreement, or where any provision hereof is validly asserted
as a defense, the successful
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party shall be entitled to recover reasonable attorneys' fees (including any
fees incurred in any appeal) in addition to its costs and expenses and any other
available remedy.
IN WITNESS WHEREOF, this Agreement has been duly executed by the parties
hereto as of the date first written above.
DYERSBURG CORPORATION
By: /s/ T. Eugene McBride
Its: President
POLYSINDO HONG KONG LIMITED
By: /s/ P. Manohar
Its: Vice President - Finance
The undersigned hereby agrees to be bound by the terms of this Agreement
with the same effect as if the undersigned were named as Texmaco herein.
PT. TEXMACO JAYA
By: /s/ Sinivasan Marimutu
Its: President/Director
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EXHIBIT A
AGREEMENT TO BE BOUND
The undersigned, being the [transferee] of __________ shares of the common
stock, $0.01 par value, of Dyersburg Corporation, a Tennessee corporation (the
"Company"), as a condition to the receipt of such securities, acknowledges that
matters pertaining to such securities are governed by an Agreement dated as of
April __, 1997 (the "Agreement") initially between the Company and Polysindo
Hong Kong Limited (the "Transferor") and the undersigned hereby (1) acknowledges
receipt of a copy of the Agreement, and (2) agrees to be bound by the terms of
the Agreement, with the same effect as if the undersigned were originally named
as the Transferor under the Agreement.
Agreed to this _____ day of ______________, ______.
________________________________
________________________________*
________________________________*
*Include address for notices.