EXHIBIT 10.9(c)
THE UNITS DISCUSSED HEREIN HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR THE SECURITIES LAWS OF
CERTAIN STATES AND ARE BEING ISSUED IN RELIANCE ON EXEMPTIONS FROM THE
REGISTRATION REQUIREMENTS OF THE ACT AND SUCH LAWS. NEITHER THE UNITS NOR ANY
INTEREST THEREIN MAY BE SOLD, TRANSFERRED, PLEDGED OR OTHERWISE DISPOSED OF IN
THE ABSENCE OF REGISTRATION UNDER THE ACT AND UNDER ANY APPLICABLE STATE
SECURITIES LAWS UNLESS PURSUANT TO EXEMPTIONS THEREFROM. ADDITIONAL RESTRICTIONS
ON TRANSFER OF THE UNITS ARE SET FORTH IN THE LIMITED LIABILITY COMPANY
AGREEMENT. THE UNITS HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION, ANY STATE SECURITIES COMMISSION OR OTHER REGULATORY
AUTHORITY, NOR HAVE ANY OF THE FOREGOING AUTHORITIES PASSED UPON OR ENDORSED THE
MERITS OF THE COMPANY. ANY REPRESENTATION TO THE CONTRARY IS UNLAWFUL.
SPECIAL UNIT ACQUISITION, OWNERSHIP AND REDEMPTION AGREEMENT
This Special Unit Acquisition, Ownership and Redemption Agreement (this
"AGREEMENT") is entered into as of the date set forth on the signature page to
this Agreement by and between Consolidated Container Holdings LLC, a Delaware
limited liability company (the "LLC"), and the individual identified on the
signature page to this Agreement ("SERVICE PROVIDER"). Capitalized terms not
otherwise defined herein shall have the meanings accorded to such terms in the
Limited Liability Company Agreement of Consolidated Container Holdings LLC,
dated as of July 1, 1999 (the "LLC AGREEMENT") or, if not defined in the LLC
Agreement, the Plan (defined below).
W I T N E S S E T H:
WHEREAS, the LLC was formed pursuant to the LLC Agreement;
WHEREAS, Service Provider provides (or will provide) services, as an
employee, to the LLC;
WHEREAS, the LLC desires to sell to Service Provider the interest in
the LLC (the "UNITS") pursuant to the exercise of an option held by Service
Provider under the Consolidated Container Holdings LLC 1999 Unit Option Plan
(the "PLAN"), subject to the terms and conditions of this Agreement; and
WHEREAS, Service Provider desires to acquire the Units specified in
connection with Service Provider's exercise of an option under the Plan, subject
to the terms and conditions of this Agreement.
NOW, THEREFORE, in consideration of the mutual promises,
representations, warranties, covenants and conditions set forth in this
Agreement, the receipt and adequacy of which all the parties to this Agreement
acknowledge, the parties mutually agree as follows:
GRANT OF INTEREST
1. Subject to the terms and conditions of this Agreement, the LLC
hereby sells to Service Provider as of the Effective Date the Units (including
Units subject to an option (an "Option")) identified as being owned by Service
Provider on EXHIBIT B hereto (collectively, the "INTEREST").
REDEMPTION OF THE INTEREST
2. Service Provider hereby agrees and acknowledges that his or her
Interest shall be subject to the following terms and conditions:
(a) TERMINATION FOR CAUSE. At any time after a Termination for
Cause (as hereinafter defined) has occurred, the LLC may purchase the Units for
the lesser of (i) Service Provider's Capital Account with respect to the Units
as of the Election Date (as hereinafter defined) and (ii) the Fair Market Value
(as hereinafter defined) of the Units on the Election Date. In addition, all of
the Service Provider's outstanding Options shall terminate immediately without
payment therefor.
(b) TERMINATION OTHER THAN FOR CAUSE. At any time after a
Termination Event (as hereinafter defined) has occurred, the LLC may purchase
(i) the Units for a price equal to the Fair Market Value of the Units on the
Election Date and (ii) all vested Options whose exercise price is less than the
Fair Market Value of the Units on the Election Date for a price equal to (A) the
Fair Market Value of the Units on the Election Date LESS (B) the exercise price
of such Options. In addition, all of the Service Provider's outstanding Options
that are unvested or whose exercise price is greater than the Fair Market Value
of the Units on the Election Date shall terminate without payment therefor.
(c) METHOD OF EXERCISE OF REDEMPTION RIGHT. The Partnership
may make an election pursuant to this SECTION 2 to purchase the Interest by
delivering written notice of such election to Service Provider. Delivery may be
made by courier, regular U.S. mail, overnight delivery, or telecopy, and shall
be effective on the date of delivery to Service Provider.
(d) DEFINITIONS. The "ELECTION DATE" shall mean the date the
LLC elects to purchase all or any portion of the Interest. The "FAIR MARKET
VALUE" of the Interest as of any date (the "VALUATION DATE") shall be equal to,
prior to a Public Offering, the fair market value thereof, disregarding any
discount for minority interest or marketability of the Interest and assuming the
prior conversion, exercise or exchange of all outstanding securities convertible
into Units ("UNIT EQUIVALENTS") as determined within six (6) months of the
Valuation Date by the Board of Directors in its sole discretion (the "BOARD
DETERMINATION"); PROVIDED, that if the Board Determination is in excess of
$250,000 in the aggregate for all Units being valued and if the Service Provider
disagrees, in good faith, with the Board Determination, the Service Provider
shall promptly notify the LLC of such disagreement, in which event an
independent appraiser,
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accountant or investment banking firm (the "APPRAISER") selected by mutual
agreement of the Service Provider and the Board of Directors of the LLC shall
make a determination of the fair market value thereof, disregarding any discount
for minority interest or marketability of the Interest and assuming the prior
conversion, exercise or exchange of all outstanding Unit Equivalents (the
"APPRAISER DETERMINATION"), and if the Appraiser Determination is (i) not at
least 110% of the Board Determination, "FAIR MARKET VALUE" shall be the Board
Determination and the Service Provider shall pay the cost of such Appraiser
Determination or (ii) 110% of the Board Determination or greater, "FAIR MARKET
VALUE" shall be the Appraiser Determination and the LLC shall pay the cost of
such Appraiser Determination. Subsequent to an Initial Public Offering (as
defined in the LLC Agreement), the term "FAIR MARKET VALUE" shall mean the price
per share equal to the average of the last sales price of the Class A Common
Stock, par value $.01 per share ("COMMON STOCK"), of Reid Plastics Holdings,
Inc., or any successor thereto (the "COMPANY") on the last thirty trading days
prior to the Valuation Date (the "REPURCHASE CALCULATION PERIOD") on each
exchange on which the Common Stock may at the time be listed or, if there shall
have been no sales on any of such exchanges during the Repurchase Calculation
Period, the average of the closing bid and asked prices on each such exchange on
each day during the Repurchase Calculation Period or, if there are no such bid
and asked prices during the Repurchase Calculation Period on the next preceding
date when such bid and asked prices occurred or, if the Common Stock shall not
be so listed, the average of the closing sales prices as reported by Nasdaq
during the Repurchase Calculation Period in the over-the-counter market. A
"TERMINATION FOR CAUSE" means a circumstance with respect to which the LLC or
any Subsidiary terminates the Service Provider's employment for "CAUSE", as such
term is defined in the Service Provider's employment agreement or, if no such
agreement exists, or such term is not defined in the employment agreement,
"Cause" shall mean the following the Service Provider's (i) willful and
intentional misconduct or gross negligence in the performance of, or willful
neglect of, the Service Provider's duties, which has caused demonstrable and
serious injury (monetary or otherwise) to the LLC or (ii) conviction of, or plea
of nolo contendere to, a felony. A "TERMINATION EVENT" means a circumstance with
respect to which Service Provider is no longer an employee of or consultant to
the LLC or any Subsidiary for any reason (other than a Termination for Cause),
including, without limitation, voluntary retirement by the Service Provider,
termination by the LLC without Cause, termination due to disability or voluntary
termination by the Service Provider.
COOPERATION IN EFFECTING TRANSFER TO PARTNERSHIP
3. Service Provider acknowledges and agrees that upon the transfer of
the Interest, Service Provider shall promptly execute, perform and deliver any
and all documents, forms and agreements requested by the LLC to reflect the
assignment, transfer and redemption of the Interest by the Service Provider to
the LLC.
SERVICE PROVIDER REPRESENTATIONS AND WARRANTIES
4. Service Provider hereby represents and warrants to the LLC as
follows:
(a) (i)Service Provider has been furnished prior to the date
hereof a copy of the LLC Agreement or a photocopy counterpart
thereof, (ii) the LLC has made available to the Service
Provider the opportunity to ask questions of, receive answers
and to
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obtain any additional information necessary to verify the
accuracy of the information set forth in the LLC Agreement and
all attachments and amendments thereto, and Service Provider
has received all such requested information from the LLC
concerning the terms and conditions of the LLC Agreement, and
(iii) Service Provider has such knowledge and experience in
financial and business matters that he is capable of
evaluating the merits and risks of owning the Interest.
(b) Service Provider has received no representations or warranties
from LLC, any member of the LLC or their employees or agents,
or any other person and, in accepting the Interest, Service
Provider is relying solely on the information contained in the
LLC Agreement.
(c) Service Provider recognizes that the potential reward from
owning the Interest is speculative and that any obtaining of
money pursuant to the Interest involves a high degree of
uncertainty.
(d) Service Provider has adequate net worth and means of providing
for his current needs and possible personal contingencies, and
has no need, and anticipates no need in the foreseeable
future, to sell the Interest which he hereby acquires.
(e) Service Provider acknowledges that it has been advised that
the interests in the LLC have not been registered under the
Securities Act of 1933, as amended, or under any state
securities law or regulation.
(f) The Interest which Service Provider hereby accepts will be
acquired for his own account for investment and not for the
benefit of any other person or with a view toward resale or
redistribution, and Service Provider does not now have any
reason to anticipate any change in his circumstances or other
particular occasion or event which would cause him to sell his
Interest.
(g) Service Provider acknowledges that there are substantial
restrictions on the transferability of the Interest. Since the
Interest is not, will not be, and Service Provider has no
right to require that it be, registered under the Securities
Act of 1933, as amended, or any other applicable state
securities laws, the Interest may not be, and Service Provider
agrees that it shall not be, sold unless such sale is exempt
from such registration under the Securities Act of 1933, as
amended, and any other applicable state securities laws or
regulations and unless the other requirements set forth in the
LLC Agreement are met, and the Service Provider recognizes
that the Interest must otherwise be held indefinitely and the
Service Provider must continue to bear the economic risk of
the investment in the Interest. Service Provider further
acknowledges that the LLC is under no obligation to aid him or
her in obtaining any exemption from any registration
requirements and that the Interest is completely
non-transferable. The Service Provider acknowledges that there
is not an existing public or other market for the Interest and
there can be no assurance that he will be able to sell or
dispose of his Interest, even if the transfer of such interest
is otherwise allowed pursuant to this Agreement or the LLC
Agreement.
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(h) In the event that Service Provider resides in a jurisdiction
which requires any legend to be placed on the LLC Agreement in
addition to the legend existing thereon, Service Provider
consents to the placement of such legend on such document.
(i) The Service Provider is competent to and has sufficient
capacity to enter into and perform his obligations under this
Agreement. This Agreement has been duly executed and delivered
by the Service Provider. Assuming the due execution and
delivery hereof by the other parties thereto, this Agreement
is enforceable against the Service Provider in accordance with
its terms.
(j) Service Provider understands the meaning and legal
consequences of the representations and warranties of Service
Provider contained in this SECTION 4. Service Provider further
understands that the LLC and its respective members,
principals and officers will rely upon such representations
and warranties in connection with their execution and
performance of this Agreement. In this connection, Service
Provider hereby agrees to indemnify and hold the LLC and their
respective principals, officers, affiliates, employees and
agents harmless from and against all losses, claims, damages,
expenses or liabilities resulting or arising from the
inaccuracy, the incompleteness or a breach by Service Provider
of any such representation or warranty. All representations
and warranties of Service Provider contained in this Agreement
shall survive the execution of this Agreement.
(k) Service Provider acknowledges that he will not be deemed to
have made any capital contributions to the LLC by virtue of
his services to the LLC.
(l) Service Provider acknowledges that, as an entity formed (for
federal income tax purposes) as a partnership, the LLC will
not pay federal income taxes, but each member (including
Service Provider) of the LLC will be required to report his
share (whether or not distributed) of the income, gains,
losses, deductions and credits of the character specified in
Section 702 of the Internal Revenue Code of 1986, as amended
("CODE"). Service Provider acknowledges that he understands
that the LLC may not be able to distribute cash to provide for
such taxes. Thus, it is possible that Service Provider as a
member of the LLC could incur income tax liabilities
attributable to the LLC without receiving from the LLC
sufficient cash distributions with which to pay such tax
liabilities.
(m) In addition to the federal income tax consequences described
above, Service Provider acknowledges that certain states in
which the LLC may own property will impose an income tax on
that portion of an individual member's distributive share of
LLC net income, as adjusted, attributable to that state in
excess of certain allowable pro-rated deductions and/or
personal exemptions (or credits). Service Provider
acknowledges that both the substantive features of state and
local taxes, income taxes and the filing requirements will
vary and that the LLC may also be required to withhold state
taxes from distributions to Service Provider in some
instances.
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CERTIFICATE OF NONFOREIGN STATUS
5. Service Provider shall complete and execute EXHIBIT A to this
Agreement with respect to his nonforeign status.
COVENANTS OF SERVICE PROVIDER
6. Service Provider hereby acknowledges and agrees that Service
Provider, as the owner of the Interest, has executed a counterpart of the LLC
Agreement and therefore is bound by and subject to the terms of the LLC
Agreement. Service Provider covenants and agrees to abide by the terms of the
LLC Agreement as in effect from time to time.
POWER OF ATTORNEY
7. Service Provider does hereby irrevocably constitute and appoint the
chief financial officer of the LLC with full power of substitution as his true
and lawful agent and attorney-in-fact, in Service Provider's name and stead to
execute, acknowledge, deliver, swear to and/or file the LLC Agreement and all
such other instruments as are described in the LLC Agreement. The power of
attorney granted hereby shall be deemed to be coupled with an interest and shall
be irrevocable and survive the death, dissolution, disability, bankruptcy or
legal incapacity of Service Provider and shall extend to Service Provider's
heirs, successors and assigns.
MISCELLANEOUS
8. The address of Service Provider for all purposes shall be the
address set forth on the signature page of this Agreement or such other address
of which the LLC has received written notice.
9. All article or section titles or captions in this Agreement are for
convenience only. They shall not be deemed part of this Agreement and in no way
define, limit, extend or describe the scope or intent of any provisions of this
Agreement.
10. The parties shall execute and deliver all documents, provide all
information and take or refrain from taking action as may be necessary or
appropriate to achieve the purpose of this Agreement.
11. This Agreement shall be binding upon and inure to the benefit of
the parties and their heirs, executors, administrators, successors, legal
representatives and permitted assigns.
12. This Agreement constitutes the entire agreement among the parties
pertaining to the subject matter hereof and supersedes all prior agreements and
understandings pertaining thereto.
13. No failure by any party to insist upon the strict performance of
any covenant, duty, agreement or condition of this Agreement or to exercise any
right or remedy consequent upon a breach thereof shall constitute waiver of any
such breach or any other covenant, duty, agreement or condition.
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14. This Agreement may be executed in counterparts, all of which
together shall constitute one agreement binding on all the parties,
notwithstanding that all the parties are not signatories to the original or the
same counterpart.
15. THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH, AND THE
RIGHTS OF THE PARTIES SHALL BE GOVERNED BY, THE LAWS OF THE STATE OF DELAWARE
APPLICABLE TO CONTRACTS ENTERED INTO AND TO BE PERFORMED IN THE STATE OF
DELAWARE.
16. If any provision of this Agreement is or becomes invalid, illegal
or unenforceable in any respect, the validity, legality and enforceability of
the remaining provisions contained herein shall not be affected thereby.
17. For purposes of this Agreement, the terms "CONTROLLING" and
"CONTROL" with respect to an entity means the power, directly or indirectly,
either to direct or cause the direction of the management policies of such
entity, whether through the ownership of voting securities or equity interest,
by contract or otherwise.
18. Any provision of this Agreement to the contrary notwithstanding,
the LLC may take such steps as it may deem necessary or desirable for the
withholding of any taxes which it is required by law or regulation of any
governmental authority, federal, state or local, domestic or foreign, to
withhold in connection with the Interest granted hereto.
19. If Service Provider shall ever become legally divorced, then in
connection with the property settlement that occurs with respect to such
divorce, Service Provider and his spouse ("SPOUSE") shall each use his or her
best efforts to convince the court to award 100% of the Interest to Service
Provider. If the court awards any portion of the Interest to Spouse, Service
Provider shall purchase and/or otherwise acquire from Spouse, for Liquidation
Value (defined below), all of Spouse's interest (if any) in the Interest, and
Spouse agrees to cooperate in transferring to Service Provider such legal,
economic and other rights in the Interest. If Service Provider fails to purchase
and/or otherwise acquire such rights, then the LLC shall have the right to
acquire from Spouse, for Liquidation Value, all of Spouse's interest in the
Interest. If the LLC does not acquire Spouse's interest in the Interest, Spouse
shall be treated only as an assignee of an interest in the LLC, and shall not be
treated as a substitute member, and shall merely have a right to receive
allocations of, profit, loss and other items of income, gain or deduction and
credit, and the rights to distributions. Spouse is executing this Agreement
solely to evidence her consent and agreement to take such actions as may be
necessary to comply with this SECTION 19. If Service Provider should ever become
divorced and then remarry during the term of this Agreement, Service Provider
covenants and agrees that Service Provider will cause his spouse to execute a
counterpart to this Agreement solely to evidence such spouse's consent and
agreement to take such actions as may be necessary to comply with this SECTION
19. The term "LIQUIDATION VALUE" with respect to the Interest (or an economic
interest in any portion of the Interest) means the amount the owner would
receive under the terms of the LLC Agreement if the LLC sold its assets for Fair
Market Value, discharged all of its liabilities, and distributed the remaining
proceeds to the Partners pursuant to Article XII of the LLC Agreement.
20. Nothing contained in this Agreement shall be deemed to obligate the
LLC or any subsidiary of the LLC to employ the Service Provider in any capacity
whatsoever or to prohibit
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or restrict the Company (or any such subsidiary) from terminating the
employment, if any, of the Service Provider at any time or for any reason
whatsoever, with or without cause.
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IN WITNESS WHEREOF, this Agreement is executed as of ______________,
1999.
LLC:
CONSOLIDATED CONTAINER HOLDINGS
LLC, a Delaware limited liability company
By:
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Name:
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Title:
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SERVICE PROVIDER:
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Name:
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Address:
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---------------------------------
Tax Identification Number
(Social Security Number):
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SERVICE PROVIDER'S SPOUSE:
__________________ is executing this Agreement solely to evidence her consent
and agreement to take such actions as may be necessary to comply with SECTION 19
of this Agreement.
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Name:
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