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EDGEN CORP | David L. Laxton, III. RealDealDocs™ contains millions of easily searchable legal documents and clauses from top law firms. Search for free - click here. |
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Exhibit 10.13
EXECUTION COPY
TRANSACTION
FEE AGREEMENT
TRANSACTION FEE AGREEMENT, dated as of October 20, 2004, by and among Edgen Corporation, a Nevada corporation (the “Company”), Jed DiPaolo (“DiPaolo”), John B. Elstrott (“Elstrott”), Edgar Hotard (“Hotard”), Dan O’Leary (“O’Leary”) and David L. Laxton, III (“Laxton”).
W I T N E S S E T H:
WHEREAS, the Company and its subsidiaries (the “Subsidiaries”) are in the business of supplying and distributing prime carbon and alloy steel pipe to the energy, process and fabrication industries;
WHEREAS, the Company is evaluating possible transactions pursuant to which one or more third parties would acquire, either directly or through a subsidiary, substantially all of the assets or alternatively, all of the issued and outstanding capital shares of the Company and/or its Subsidiaries (a “Sale”);
WHEREAS, each of DiPaolo, Elstrott and Hotard serves as a director of the Company (collectively, the “Directors”);
WHEREAS, O’Leary serves as President and Chief Executive Officer of the Company and Edgen Louisiana Corporation, a Louisiana corporation and a wholly-owned subsidiary of the Company (“Edgen Louisiana”), and Laxton serves as Chief Financial Officer and Senior Vice, President of the Company and Edgen Louisiana (collectively, the “Executives”);
WHEREAS, the Company desires that each of the Directors continue his directorship arrangement with the Company until the consummation of the Sale;
WHEREAS, the Company desires that each of the Executives continue his employment with the Company and Edgen Louisiana until the consummation of the Sale;
NOW, THEREFORE, in consideration of the mutual covenants herein contained, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties, hereto, intending to be legally bound hereby, agree as follows:
1. Effective Date. This Agreement shall be effective as of the date first above written (the “Effective Date”),
2. Compensation. Concurrent with the closing of (i) a stock sale, merger, joint venture formation or other business combination or recapitalization of the Company or its Subsidiaries in connection with which control of the Company or its Subsidiaries, as the case may be, is assumed by one or more unaffiliated third parties (collectively, a “Business Combination”), or (ii) a sale of all or substantially all of the Company’s or its Subsidiaries’ assets (an “Asset Sale”, and, together with a Business Combination, a “Transaction”), the
Company will pay to the Directors, Executives and certain other individuals an aggregate amount equal to 2% of the Transaction Amount (the “Transaction Fee”).
(a) Concurrent with, and as a condition to, the closing of a Transaction, the Company will pay to each Director, in consideration of such Director’s continued services as a director of the Company until the consummation of a Transaction, a fee in an amount set forth opposite such Director’s name on Schedule A attached hereto (the “Director Transaction Fee”).
(b) Concurrent with, and as a condition to, the closing of a Transaction, the Company will pay to each Executive, in consideration of such Executive’s continued employment with the Company and with Edgen Louisiana until the consummation of a Transaction, a fee in an amount equal to the percentage set forth opposite such Executive’s name on Schedule A attached hereto of the Transaction Fee (the “Executive Transaction Fee”).
(c) The balance of the Transaction Fee shall be paid to certain individuals at the discretion of, and by the mutual agreement of, Ira Kleinman and O’Leary.
(d) “Transaction Amount” as used herein, is defined as the total consideration paid or contributed for the assets, or existing and any newly issued stock of the Company or any of its Subsidiaries, and shall include amounts paid in cash, notes, property, stock or other evidences of indebtedness or securities. Any securities that form part or all of the Transaction Amount will be valued at the quoted public market price or, in the absence of a quoted market price, the fair value thereof. If part of the consideration paid or contributed in a Business Combination or Asset Sale shall be payable in installments or shall be contingent, then the amount, if any, of the Transaction Fee shall be payable in the proportionate amounts and at the same time as such installments or contingent payments are made. In the event of a recapitalization, Transaction Amount shall equal the value of cash, notes, property and securities distributed to the Company’s stockholders. The Transaction Fee will be payable so long as a Transaction is consummated.
3. Term. The term of this Agreement shall commence on the date hereof and shall terminate upon March 31, 2005 (the “Term”).
4. Assignment. Neither the Executive nor the Company may assign this Agreement or any of their respective rights or obligations hereunder, except that either of them may assign or transfer this Agreement to any other person who or which acquires all or substantially all of their respective property, business and assets.
5. Severability. The invalidity or unenforceability of any provision of this Agreement shall, not in any manner or way affect any other provision hereof; and this Agreement shall be construed, if possible, as if amended to conform to legal requirement, failing which it shall be construed as if any such offending provision were omitted.
6. Governing Law. This Agree
