Document:

f8k021111ex10xii_triangcast.htm

Exhibit 10.12

STOCKHOLDERS AGREEMENT

STOCKHOLDERS AGREEMENT dated as of January 24, 2011 by and among (i) Prospect Global Resources Inc., a Delaware corporation (the "Company"), (ii) Richard Merkin ("Merkin"), and (iii) the other holders of Common Stock of the Company signatory hereto (together with Merkin, the "Stockholders").

 

Section 1. Definitions.  For purposes of this Agreement, the following terms have the indicated meanings:

 

"Affiliate" of a person means any other person controlling, controlled by or under common control with such person, whether by ownership of voting securities, by contract or otherwise.

 

"Board" means the Company's Board of Directors.

 

"Common Stock" means the Company's common stock, par value $ .0001 per share.

 

"Securities Act" means the Securities Act of 1933, as amended.

 

Section 2. Board of Directors.  Each Stockholder agrees, for so long as Merkin owns at least 1,000,000 shares of Common Stock, to vote all shares of Common Stock over which such Stockholder and its Affiliates have voting control and to take all other necessary or desirable actions within its control (whether as a stockholder, director or officer of the Company or otherwise, and including, without limitation, attendance at meetings in person or by proxy for purposes of obtaining a quorum and execution of written consents in lieu of meetings), and the Company shall take all necessary and desirable actions within its control (including, without limitation, calling special board and stockholder meetings), so that the person Merkin designates in writing from time to time to the other Stockholders is elected to the Board.  For so long as Merkin has the right to designate one member of the Board, and for a period of three (3) years thereafter, the Company shall, at its sole expense, obtain customary a directors’ and officers’ liability insurance policy.

 

Section 3. Tag Along Right.  Except in the case of any transfer to an Affiliate, not less than 15 days prior to any proposed transfer of Common Stock, other than the sale in one or a series of related transactions of Common Stock by any Stockholder or its Affiliates, the transferring Stockholder (the “Initiating Holder”) shall deliver to Merkin a written notice (the “Sale Notice”) specifying in reasonable detail the identity of the proposed transferee(s), the number of shares proposed to be sold, and the terms and conditions of the proposed transfer.  Merkin may elect to participate in the transfer by delivering to the Initiating Stockholder a written notice of such election within the 15-day period following delivery of the Sale Notice.  If Merkin elects to participate in such transfer, the Initiating Stockholder and Merkin will be entitled to sell in such proposed transfer, at the same price and on the same terms (including form of consideration), a number of shares equal to the product of (i) the quotient determined by dividing the number of shares proposed to be sold by the Initiating Stockholder or Merkin, as the case may be, by the number of shares proposed to be sold by the Initiating Stockholder and Merkin, multiplied by (ii) the total number of shares to be sold in such proposed transfer.  Merkin's rights hereunder shall terminate upon the issuance of Common Stock in a registered public offering under the Securities Act of 1933, as amended, with gross proceeds to the Company of at least $10,000,000.

 

  

1

  

 

Section 4. Amendment and Waiver.  Except as otherwise provided herein, no amendment of any provision of this Agreement shall be effective unless such amendment or waiver is approved in writing by the Company, Merkin and the holders of at least a majority of the shares of Common Stock then held by the other Stockholders.  The failure of any party to enforce any provision of this Agreement shall not be construed as a waiver of such provision and shall not affect the right of such party thereafter to enforce each provision of this Agreement in accordance with its terms.

 

Section 5. Severability.  If any provision of this Agreement is held to be invalid, illegal or unenforceable in any respect under any applicable law or rule in any jurisdiction, such invalidity, illegality or unenforceability shall not affect any other provision or any other jurisdiction, but this Agreement shall be reformed, construed and enforced in such jurisdiction as if such invalid, illegal or unenforceable provision had never been contained herein.

 

Section 6. Entire Agreement.  Except as otherwise expressly set forth herein, this document embodies the complete agreement and understanding among the parties hereto with respect to the subject matter hereof and supersedes and preempts any prior understandings, agreements or representations by or among the parties, written or oral, which may have related to the subject matter hereof in any way.

 

Section 7. Successors and Assigns.  This Agreement shall bind and inure to the benefit of and be enforceable by the Company and the Stockholders and their respective successors and assigns; provided, that Merkin may not assign its right to designate a director to any transferee of Common Stock from Merkin other than an Affiliate of Merkin without the Company's written consent.

 

Section 8. Counterparts.  This Agreement may be executed in separate counterparts each of which shall be an original but all of which taken together shall constitute but one instrument.

 

Section 9. Notices.  Any notice, payment, demand or communication required or permitted to be given pursuant to this Agreement shall be in writing and shall be (i) delivered personally, (ii) transmitted by telecopy, or (iii) delivered by nationally recognized overnight courier service for next business day delivery, addressed as follows, or to such other address as such person may from time to time specify by notice to the parties hereto:

 

The Company:

 

Prospect Global Resources Inc.

600 17th Street, Suite 2800-South

Denver CO 80202

Attention:  Pat Avery

Fax:  720-294-0402

 

  

2

  

 

Stockholders:  To the address specified on the signature page hereto

 

Section 10. Governing Law.  This Agreement shall be construed in accordance with and governed by the laws of the State of Delaware without giving effect to principles of conflicts of laws thereof.

 

Section 11. Descriptive Headings.  The descriptive headings of this Agreement are inserted for convenience only and do not constitute a part of this Agreement.

 

* * * * *

 

  

3

  

 

    IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first above written.

 

	 	PROSPECT GLOBAL RESOURCES INC.	 
	 	 	 	 
	 	By:	/s/ Patrick Avery	 
	 	 	Patrick Avery	 
	 	 	Chief Executive Officer	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	STOCKHOLDERS	 
	 	 	 
	 	/s/ Richard Merkin	 
	 	Richard Merkin	 
	 	 	 
	 	/s/ Patrick Avery	 
	 	Patrick Avery	 
	 	 	 
	 	/s/ Jonathan Bloomfield	 
	 	Jonathan Bloomfield	 
	 	 	 
	 	/s/ Barry Munitz	 
	 	Barry Munitz	 
	 	 	 
	 	/s/ J. Ari Swiller	 
	 	J. Ari Swiller	 
	 	 	 
	 	/s/ Bevan Cooney	 
	 	Bevan Cooney	 
	 	 	 
	 	 	 
	 	 	 
	 	QUINCY PRELUDE LLC	 
	 	 	 
	 	By:	/s/ Authorized Signatory	 
	 	 	Name:  Authorized Signatory	 
	 	 	Title:  Manager	 
	 	 	 	 
	 	BALKAN HELENIC PARTNERSHIP	 
	 	 	 	 
	 	By:	/s/ Balkan Management LLC	 
	 	 	its general partner	 
	 	 	 	 
	 	By:	/s/ Mark McMillan	 
	 	 	Name: Mark McMillan	 
	 	 	Its: Manager	 
	 	 	 	 

 

 

 4f8k021111ex10xiii_triangcast.htm

Exhibit 10.13

 

SECURITY AGREEMENT

Dated as of January 24, 2011

 

1.  THE SECURITY.  The undersigned, Prospect Global Resources Inc., a Delaware corporation (the “Debtor”), hereby assigns and grants to the holder of the Note (as defined in Section 2) (the “Secured Party”) a security interest in the following described property, now owned or hereafter acquired by the Debtor and wherever located (“Collateral”):

 

(a)  All accounts, contract rights, chattel paper, instruments, deposit accounts, letter of credit rights, payment intangibles and general intangibles and all returned or repossessed goods which, on sale or lease, resulted in an account or chattel paper.

 

(c)  All securities of any type or any other ownership interest in any business or venture of any nature, securities entitlements, securities accounts, investment property, instruments, chattel paper, and electronic chattel paper and Secured Party's books relating to the foregoing.

 

(d)  All inventory, including all materials, work in process and finished goods.

 

(e)  All machinery, furniture, fixtures and other equipment of every type.

 

(f)  All general intangibles, including, but not limited to, (i) all patents, and all unpatented or unpatentable inventions; (ii) all trademarks, service marks, and trade names; (iii) all copyrights and literary rights; (iv) all computer software programs; (v) all mask works of semiconductor chip products; (vi) all trade secrets, proprietary information, customer lists, manufacturing, engineering and production plans, drawings, specifications, processes and systems.  The Collateral shall include all good will connected with or symbolized by any of such general intangibles; all contract rights, documents, applications, licenses, materials and other matters related to such general intangibles; all tangible property embodying or incorporating any such general intangibles; and all chattel paper and instruments relating to such general intangibles.

 

(g)  All negotiable and non-negotiable documents of title covering any Collateral.

 

(h)  All accessions, attachments and other additions to the Collateral, and all tools, parts and equipment used in connection with the Collateral.

 

(i) All substitutes or replacements for any Collateral, all cash or non-cash proceeds, products, rents and profits of any Collateral, all income, benefits and property receivable on account of the Collateral, all rights under warranties and insurance contracts, letters of credit, guaranties or other supporting obligations covering the Collateral, and any causes of action relating to the Collateral.

 

(j)  All books and records pertaining to any Collateral, including but not limited to any computer-readable memory and any computer hardware or software necessary to process such memory (“Books and Records”).

 

2.  THE INDEBTEDNESS.  The Collateral secures and will secure all obligations of the Debtor to the Secured Party as defined in the Convertible Secured Promissory Note, dated the date hereof, in an aggregate principal amount of $2,000,000, by the Debtor to the Secured Party (the “Note”).  “Secured Indebtedness” means all debts, obligations or liabilities now or hereafter existing, absolute or contingent of the Debtor to the Secured Party, whether voluntary or involuntary, whether due or not due, or whether incurred directly or indirectly or acquired by the Secured Party by assignment or otherwise.

 

  

1

  

 

3.  DEBTOR’S REPRESENTATIONS AND COVENANTS.  The Debtor represents, covenants and warrants that unless compliance is waived by the Secured Party in writing:

 

(a)  The Debtor will properly preserve the Collateral; defend the Collateral against any adverse claims and demands; and keep accurate Books and Records.

 

(b)  On the date hereof, the Debtor’s chief executive office is located at the address specified on the signature page hereof.  In addition, on the date hereof, the Debtor’s jurisdiction of organization and exact legal name are as set forth in the first paragraph of this Agreement.  The Debtor shall give the Secured Party at least 10 Business Days’ notice before changing its chief executive office or jurisdiction of incorporation or organization or its registration as an organization (or effecting any new such registration).  The Debtor will notify the Secured Party in writing prior to any change in the location of any Collateral, including the Books and Records.

 

(c)  The Debtor will notify the Secured Party in writing at least 10 days prior to any change in the Debtor’s name, identity or business structure.

 

(d)  The Debtor has not granted and will not grant any security interest in any of the Collateral, and will keep the Collateral free of all liens, claims, security interests and encumbrances of any kind or nature, in each case except for the security interest of the Secured Party and other Permitted Liens (as defined in the Credit Agreement).

 

(e)  The Debtor will promptly notify the Secured Party in writing of any event which materially and adversely affects the value of the Collateral, taken as a whole, the ability of the Debtor or the Secured Party to dispose of the Collateral, or the rights and remedies of the Secured Party in relation thereto.

 

(f)  The Debtor shall pay all costs necessary to preserve, defend, enforce and collect the Collateral, including but not limited to taxes, assessments, insurance premiums, repairs, rent, storage costs and expenses of sales, and any costs to perfect the Secured Party’s security interest (collectively, the “Collateral Costs”).  Without waiving the Debtor’s default for failure to make any such payment, the Secured Party at its option may pay any such Collateral Costs, and discharge encumbrances on the Collateral, and such Collateral Costs payments shall be a part of the Secured Indebtedness and bear interest at the rate set out in the Credit Agreement. The Debtor agrees to reimburse the Secured Party on demand for any Collateral Costs so incurred.

 

(g)  Until the Secured Party exercises its rights to make collection, the Debtor will diligently pursue rights to payment constituting Collateral.

 

(h)  If any Collateral is or becomes the subject of any registration certificate, certificate of deposit or negotiable document of title, including any warehouse receipt or bill of lading, the Debtor shall immediately deliver such document to the Secured Party, together with any necessary endorsements.

 

(i)  So long as no default has occurred and is continuing under this Agreement, the Debtor may withdraw funds from any deposit account which is part of the Collateral without the Secured Party’s prior written consent.

 

(j)  The Debtor will at its expense protect and defend all rights in the Collateral against any material claims and demands of all persons other than the Secured Party and will, at its expense, enforce all rights in the Collateral against any and all infringers of the Collateral where such infringement would materially impair the value or use of the Collateral to the Debtor or the Secured Party.  The Debtor will not license or transfer any of the Collateral, except for such licenses as are customary in the ordinary course of the Debtor’s business, or except with the Secured Party’s prior written consent.

 

  

2

  

 

4.  ADDITIONAL REQUIREMENTS.  The Debtor agrees that the Secured Party may at its option at any time, whether or not the Debtor is in default hereunder:

 

(a)  Require the Debtor to deliver to the Secured Party (i) copies of or extracts from the Books and Records, and (ii) information on any contracts or other matters affecting the Collateral.

 

(b)  Examine the Collateral, including the Books and Records, and make copies of or extracts from the Books and Records, and for such purposes enter at any reasonable time after reasonable notice to the Debtor upon the property where any Collateral or any Books and Records are located.

 

(c)  Require the Debtor to deliver to the Secured Party any instruments, chattel paper or letters of credit which are part of the Collateral, and to assign to the Secured Party the proceeds of any such letters of credit.

 

(d)  Only at such time that an Event of Default has occurred and is continuing, notify any account debtors, any buyers of the Collateral, or any other persons of the Secured Party’s interest in the Collateral.

 

5.  DEFAULTS.  Any Event of Default (as defined in the Notes) shall be an Event of Default hereunder.

 

6.  SECURED PARTY’S REMEDIES AFTER DEFAULT.  Upon the occurrence of, and during the continuance of, any Event of Default, the Secured Party may do any one or more of the following:

 

(a)  Declare any Secured Indebtedness immediately due and payable, without notice or demand.

 

(b)  Enforce the security interest given hereunder pursuant to the Uniform Commercial Code and any other applicable law.

 

(c)  Exert control over any deposit or securities accounts of the Debtor.

 

(d)  Enforce the security interest of the Secured Party in any deposit account of the Debtor maintained with the Secured Party by applying such account to the Secured Indebtedness.

 

(e) Require the Debtor to obtain the Secured Party’s prior written consent to any sale, lease, agreement to sell or lease, or other disposition of any Collateral consisting of inventory.

 

(f)  Require the Debtor to segregate all collections and proceeds of the Collateral so that they are capable of identification and deliver daily such collections and proceeds to the Secured Party in kind.

 

(g)  Require the Debtor to direct all account debtors to forward all payments and proceeds of the Collateral to a post office box under the Secured Party’s exclusive control.

 

(h)  Require the Debtor to assemble the Collateral, including the Books and Records, and make them available to the Secured Party at a place designated by the Secured Party.

 

  

3

  

 

(i)  Enter upon the property where any Collateral, including any Books and Records, are located and take possession of such Collateral and such Books and Records, and use such property (including any buildings and facilities) and any of the Debtor’s equipment, if the Secured Party deems such use necessary or advisable in order to take possession of, hold, preserve, process, assemble, prepare for sale or lease, market for sale or lease, sell or lease, or otherwise dispose of, any Collateral.

 

(j)  Demand and collect any payments on and proceeds of the Collateral.  In connection therewith the Debtor irrevocably authorizes the Secured Party to endorse or sign the Debtor’s name on all checks, drafts, collections, receipts and other documents, and to take possession of and open the mail addressed to the Debtor and remove therefrom any payments and proceeds of the Collateral.

 

(k)  Grant extensions and compromise or settle claims with respect to the Collateral for less than face value, all without prior notice to the Debtor.

 

(l)  Use or transfer any of the Debtor’s rights and interests in any Intellectual Property now owned or hereafter acquired by the Debtor, if the Secured Party deems such use or transfer necessary or advisable in order to take possession of, hold, preserve, process, assemble, prepare for sale or lease, market for sale or lease, sell or lease, or otherwise dispose of, any Collateral.  The Debtor agrees that any such use or transfer shall be without any additional consideration to the Debtor.  As used in this paragraph, “Intellectual Property” includes, but is not limited to, all trade secrets, computer software, service marks, trademarks, trade names, trade styles, copyrights, patents, applications for any of the foregoing, customer lists, working drawings, instructional manuals, and rights in processes for technical manufacturing, packaging and labeling, in which the Debtor has any right or interest, whether by ownership, license, contract or otherwise.

 

(m)  Have a receiver appointed by any court of competent jurisdiction to take possession of the Collateral.  The Debtor hereby consents to the appointment of such a receiver and agrees not to oppose any such appointment.

 

(n)  Take such measures as the Secured Party may deem necessary or advisable to take possession of, hold, preserve, process, assemble, insure, prepare for sale or lease, market for sale or lease, sell or lease, or otherwise dispose of, any Collateral, and the Debtor hereby irrevocably constitutes and appoints the Secured Party as the Debtor’s attorney-in-fact to perform all acts and execute all documents in connection therewith.

 

(o)  Without notice or demand to the Debtor, set off and apply against any and all of the Secured Indebtedness any and all deposits (general or special, time or demand, provisional or final) at any time held or owing by the Secured Party or any of the Secured Party’s agents or affiliates to or for the credit of the account of the Debtor.

 

(p)  Exercise any other remedies available to the Secured Party at law or in equity.

 

7.  MISCELLANEOUS.

 

(a)  Any waiver, express or implied, of any provision hereunder and any delay or failure by the Secured Party to enforce any provision shall not preclude the Secured Party from enforcing any such provision thereafter.

 

  

4

  

 

(b)  The Debtor shall, at the request of the Secured Party, execute such other agreements, documents, instruments or financing statements in connection with this Agreement as the Secured Party may reasonably deem necessary.

 

(c)  All notes, security agreements, subordination agreements and other documents executed by the Debtor or furnished to the Secured Party in connection with this Agreement must be in form and substance satisfactory to the Secured Party.

 

(d)  This Agreement shall be governed by and construed according to the law of the State of Delaware.

 

(e)  All rights and remedies herein provided are cumulative and not exclusive of any rights or remedies otherwise provided by law.  Any single or partial exercise of any right or remedy shall not preclude the further exercise thereof or the exercise of any other right or remedy.

 

(f)  Except as set forth in the Credit Agreement, all terms not defined herein are used as set forth in the Uniform Commercial Code.

 

(g)  In the event of any action by the Secured Party to enforce this Agreement or to protect the security interest of the Secured Party in the Collateral, or to take possession of, hold, preserve, process, assemble, insure, prepare for sale or lease, market for sale or lease, sell or lease, or otherwise dispose of, any Collateral, the Debtor agrees to pay immediately the costs and expenses thereof, together with attorney’s fees and allocated costs for in-house legal services to the extent permitted by law.

 

(h)  In the event the Secured Party seeks to take possession of any or all of the Collateral by judicial process, the Debtor hereby irrevocably waives any bonds and any surety or security relating thereto that may be required by applicable law as an incident to such possession, and waives any demand for possession prior to the commencement of any such suit or action.

 

(i)  This Agreement shall constitute a continuing agreement, applying to all future as well as existing transactions, whether or not of the character contemplated at the date of this Agreement, and if all transactions between the Secured Party and the Debtor shall be closed at any time, shall be equally applicable to any new transactions thereafter.

 

(j)  No amendment or waiver of any provision of this Agreement and no consent by the Secured Party to any departure therefrom by the Debtor shall be effective unless such amendment, waiver or consent shall be in writing and signed by a duly authorized officer of the Secured Party, and any such amendment, waiver or consent shall then be effective only for the period and on the conditions and for the specific instance specified in such writing.  No failure or delay by the Secured Party in exercising any right, power or privilege hereunder shall operate as a waiver thereof, nor shall any single or partial exercise thereof preclude any other or further exercise thereof or the exercise of any other rights, power or privilege.

 

  

5

  

 

(k)  The Secured Party’s rights hereunder shall inure to the benefit of its successors and assigns.  In the event of any assignment or transfer by the Secured Party of any of the Secured Indebtedness or the Collateral, the Secured Party thereafter shall be fully discharged from any responsibility with respect to the Collateral so assigned or transferred, but the Secured Party shall retain all rights and powers hereby given with respect to any of the Secured Indebtedness or the Collateral not so assigned or transferred.  All terms, covenants and agreements of the Debtor herein shall be binding upon the successors and assigns of the Debtor.

 

IN WITNESS WHEREOF, this Security Agreement has been executed as of the date set forth above.

 

	 	PROSPECT GLOBAL RESOURCES INC.	 
	 	 	 	 
	
 

	
By: 

	/s/ Patrick Avery	 
	 	 	Patrick Avery, Chief Executive Officer	 
	 	 	 	 
	 	SECURED PARTY:	 
	 	 	 	 
	 	/s/ Richard Merkin	 
	 	Richard Merkin	 

 

 

6

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00184-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00184-of-00352.parquet"}]]