AMENDED AND RESTATED STOCKHOLDERS? AGREEMENT

Exhibit 10.1

AMENDED AND RESTATED STOCKHOLDERS’ AGREEMENT

among

JOHNSONDIVERSEY HOLDINGS, INC.,

COMMERCIAL MARKETS HOLDCO, INC.

and

MARGA B.V.

Dated as of May 1, 2006

TABLE OF CONTENTS

 

 

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SCHEDULES AND EXHIBITS:

 

 

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AMENDED AND RESTATED STOCKHOLDERS’ AGREEMENT

This AMENDED AND RESTATED STOCKHOLDERS’ AGREEMENT (this “ Agreement ”), dated as of May 1, 2006, is by and among JohnsonDiversey Holdings, Inc., a Delaware corporation (formerly known as Johnson Professional Holdings, Inc., the “ Company ”), Commercial Markets Holdco, Inc., a Wisconsin corporation (“ Holdco ”), and Marga B.V., a company organized under the laws of The Netherlands (“ Marga ”) and an indirect, wholly-owned subsidiary of Unilever N.V., a company organized under the laws of The Netherlands (“ Unilever NV ”). Marga, together with Holdco and such other Persons listed on Schedule A (as such schedule may be amended from time to time), including any Permitted Transferees, are referred to collectively as the “ Stockholders ” and each individually as a “ Stockholder .”

RECITALS

WHEREAS, the Company, which was formed by the filing on November 8, 2001 of a Certificate of Incorporation with the Secretary of State of the State of Delaware, had been a wholly-owned subsidiary of Holdco at all times prior to the Closing Date (as hereinafter defined);

WHEREAS, on November 20, 2001, the Company, S.C. Johnson Commercial Markets, Inc. a Delaware corporation (now known as JohnsonDiversey, Inc., “ CMI ”) and a wholly-owned (except for one share) subsidiary of the Company, and Conopco, Inc., a New York corporation (“ Conopco ”) and an indirect, wholly-owned subsidiary of Unilever entered into a Purchase Agreement (the “ Purchase Agreement ”) providing for, among other things, (i) Conopco paying or causing to be paid the Subscription Payment (as defined in the Purchase Agreement) in exchange for the issuance by the Company to Marga of the number of Class B Shares (as hereinafter defined) set forth opposite Marga’s name on Schedule A as of the date hereof and (ii) the execution of this Agreement to set forth provisions relating to, among other things, the governance of the Company and various other rights and obligations of the Company and the Stockholders;

WHEREAS, Conopco has caused Marga to pay the Subscription Payment to the Company pursuant to the Purchase Agreement, and Unilever NV has guaranteed the performance by Conopco of its obligations thereunder and by the Unilever Stockholder of its obligations hereunder, in each case pursuant to a Guarantee of Performance and Indemnity Agreement, dated as of November 20, 2001;

WHEREAS, Marga shall initially be the Unilever Stockholder;

WHEREAS, on or before the Closing Date, Holdco transferred to the Company, as an additional capital contribution, $25 million in the form of cash in consideration for which the Company issued additional Class A Shares (as hereinafter defined), which are included in the number of Class A Shares set forth opposite Holdco’s name on Schedule A as of the date hereof; and

WHEREAS, the Company and the Stockholders desire to amend and restate this Agreement as provided herein, effective upon the completion of the sale of the Polymer Business

pursuant to the terms and conditions of the Asset and Equity Interest Purchase Agreement, dated as of May 1, 2006, by and among Johnson Polymer, LLC, JohnsonDiversey Holdings II B.V. and BASF Aktiengesellschaft in the form approved in writing by the Stockholders (including such amendments as may be made in accordance with that approval), save that the amendment set forth in Exhibit 11 shall become effective and binding, and the original Stockholders’ Agreement, dated May 3, 2002, shall be so amended, immediately upon the execution of this Agreement by the parties hereto.

NOW, THEREFORE, the Company and the Stockholders agree as follows:

ARTICLE I

DEFINITIONS

1.1 Certain Definitions . Terms used in this Agreement with initial capital letters that are not defined in this Agreement shall have the meanings given to them in the Purchase Agreement. As used in this Agreement, the following terms have the following meanings:

“ 144A Notes ” means the 9.625% Senior Subordinated Notes due 2012 of CMI in the aggregate principal amount of $300,000,000 (the “Dollar Notes”) and the 9.625% Senior Subordinated Notes due 2012 of CMI in the aggregate principal amount of EUR 225,000,000 (the “Euro Notes”) in each case, issued on the Closing Date.

“ 144A Notes Indentures ” means the Indenture dated as of the Closing Date between CMI and BNY Midwest Trust Co., as trustee, providing for the issuance of the Dollar Notes and the Indenture dated as of the Closing Date between CMI and The Bank of New York, as trustee, providing for the issuance of the Euro Notes, in each case, as amended or supplemented from time to time.

“ Accounting Expert ” means a firm of internationally recognized independent public accountants (other than the then current auditors of the Company, the Unilever Stockholder or Unilever) mutually selected by the Unilever Stockholder and the Company or, if the Unilever Stockholder and the Company fail to agree within ten Business Days after commencing discussions thereon, (a) the public accounting firm of Ernst & Young, LLP or any successor organization, subject to clearance of any conflicts of interest, (b) if Ernst & Young, LLP is conflicted, the public accounting firm of KPMG, LLP or any successor organization, subject to clearance of any conflicts of interest, and (c) if KPMG, LLP is conflicted, the public accounting firm of Deloitte & Touche LLP, or any successor organization, subject to clearance of any conflicts of interest.

“ Accounts Receivable Securitization Facility ” means (a) the Receivables Sale Agreement, dated as of March 2, 2001, between CMI and JWPR Corporation, (b) the Receivables Sale Agreement, dated as of March 2, 2001, between Polymer and JWPR Corporation, (c) the Receivables Sale Agreement, dated as of March 2, 2001, between U.S. Chemical Corporation and JWPR Corporation, (d) the Receivables Sale Agreement, dated as of March 2, 2001, between Whitmire and JWPR Corporation, (e) the Receivables Purchase

 

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Agreement, dated as of March 2, 2001, among JWPR Corporation, Falcon Asset Securitization Corporation and Bank One, NA, and (f) the Receivables Sale and Contribution Agreement, dated as of March 2, 2001, among Polymer, U.S. Chemical Corporation, Whitmire, CMI, JWP Investments, Inc. and JWPR Corporation, in each case, as amended, restated or supplemented on or after the date hereof, other than to increase the amount of Indebtedness available thereunder.

“ Accreted Value ” has the meaning set forth in the Note Indenture.

“ Accumulated Excess Pension Contributions ” means the cumulative aggregate amount of all Pension Differential Contributions determined for all full and partial Fiscal Years, without duplication, during the period beginning on the Closing Date and ending on the last day of the applicable Measurement Period; provided , however , that if such aggregate amount is negative, it shall be deemed to be zero.

“ Additional Divestiture ” has the meaning set forth in Section 8.13.

“ Additional Divestiture Identification ” has the meaning set forth in Section 8.13.

“ Additional Floor Payment ” has the meaning set forth in Section 7.9.

“ Additional Payments ” has the meaning set forth in Section 7.9.

“ Additional Rounding Payment ” has the meaning set forth in Section 7.9.

“ Additional Shares ” has the meaning set forth in Section 7.9.

“ Additional Shares Closing Date ” has the meaning set forth in Section 7.9.

“ Additional Shares Exercise Date ” has the meaning set forth in Section 7.9.

“ Additional Shares Purchase Price ” has the meaning set forth in Section 7.9.

“ Affiliate ” means, with respect to a specified Person, any other Person that directly, or indirectly through one or more intermediaries, controls, is controlled by, or is under common control with, such specified Person. Notwithstanding the foregoing, for the purposes of this Agreement, (a) no Unilever Group Member shall be regarded as an Affiliate of Holdco, any other Holdco Group Member or any Company Group Member, and (b) no Holdco Group Member shall be regarded as an Affiliate of Unilever, any Unilever Group Member or any Company Group Member.

“ Affiliate Transaction ” means any agreement, contract, arrangement or other transaction or series of related transactions (including, without limitation, any purchase, sale, transfer, assignment, lease, license, conveyance or exchange of assets or property, any merger, consolidation or similar transaction or any provision of any service) between or among (i) the Company or any Affiliate controlled by the Company (a “ Company-Controlled Affiliate ”), on the one hand, and (ii) any Holdco Group Member (other than the Company or a Company-Controlled Affiliate) or any director or officer of any such Holdco Group Member, on the other hand, that has an aggregate fair market value or pursuant to the terms thereof will result in

 

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aggregate expenditures or aggregate payments in excess of (a) with respect to agreements, contracts, arrangements and transactions that are not on arm’s length terms, $100,000 individually, or (b) with respect to agreements, contracts, arrangements and transactions that are on arm’s length terms, $2,000,000 individually, or (c) $100,000 individually (in the case of arm’s length agreements, contracts, arrangements and transactions) or $10,000 individually (in the case of non-arm’s length agreements, contracts, arrangements and transactions), as applicable, in each case in the event that Affiliate Transactions in excess of $10,000,000, collectively, have been entered into in the immediately preceding twelve months (each, an “ Affiliate Maximum Amount ”); provided , however , that Affiliate Transactions shall not include (A) transactions effected pursuant to (1) any Transaction Document, (2) any agreement, contract or arrangement set forth on Part A of Exhibit 1 as of the date of the Purchase Agreement, (3) any agreement, contract or arrangement on arm’s length terms set forth on Part B of Exhibit 1 as of the date hereof, (4) any agreement, contract or arrangement on arm’s length terms in effect, or entered into, on or prior to the date hereof that has an aggregate fair market value or pursuant to the terms thereof will result in aggregate expenditures or aggregate payments of less than $500,000 individually, and (5) any renewal, extension, amendment or modification of any of the foregoing which (x) is not material and does not provide for any price increases under such agreement, contract or arrangement in excess of 10% of then current prices, or (y) is automatically effective under the terms of such agreement, contract or arrangement as in effect on or prior to the date hereof), (B) any agreement, contract, arrangement or transaction with respect to the compensation of a director or officer of the Company or any Company-Controlled Affiliate approved by the Compensation Committee of the Board, and (C) any employment, non-competition, confidentiality or similar agreement entered into by the Company or any Company-Controlled Affiliate with a director, officer or employee of the Company or a Company-Controlled Affiliate in the Ordinary Course of Business. For purposes of this definition, “ arm’s length terms ” means terms that are no less favorable to the Company or such Company-Controlled Affiliate than those that could have been obtained in a transaction by the Company or such Company-Controlled Affiliate with a Person that is an independent third party.

“ Agency Adjustment ” means an amount equal to the product of (a) the annual net after interest, allocated with revenue as the key, and tax earnings of the Company attributable to amounts payable by Unilever pursuant to the New Agency Agreement (the “ Annual Agency Earnings ”), times (b) the number of years remaining in the Agency Term after the applicable Put Closing Date or Call Closing Date (as the case may be). Annual Agency Earnings shall be measured on the basis of the net after interest and tax earnings attributable to (a) amounts actually paid by Unilever during the applicable Measurement Period if the New Agency Agreement was in effect during the entirety of such Measurement Period, or (b) amounts estimated in good faith by the Company to be paid by Unilever during the first year of the New Agency Agreement if the New Agency Agreement was not in effect during the entirety of the applicable Measurement Period, based upon the terms and conditions of the New Agency Agreement and prior experience which is comparable to the experience the Company anticipates under the New Agency Agreement.

“ Agency Term ” has the meaning set forth in Section 8.16.

“ Agreement ” has the meaning set forth in the introductory paragraph to this Agreement.

 

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“ Alternative Structure Conditions ” has the meaning set forth in Section 7.9.

“ Annual Capital Budget ” has the meaning set forth in Section 4.11.

“ Annual Operating Budget ” has the meaning set forth in Section 4.11.

“ Applicable EBITDA ” means the aggregate EBITDA during the applicable Measurement Period, calculated in accordance with Exhibit 4 .

“ Applicable Indebtedness ” means the Indebtedness of the Company Group as of the last day of the applicable Measurement Period (measured on a consolidated basis in accordance with GAAP) as reflected on the financial statements of the Company as of such day.

“ Applicable Law ” means (a) all applicable and binding international, foreign, federal, European Union, national, supranational, state, regional or local laws, statutes and subordinate legislation, directives, rules, regulations, ordinances, zoning, building or other similar restrictions, orders, decisions, judgments or decrees, regulatory agreements or regulatory orders, (b) the common law and (c) the rules and regulations of any United States or foreign securities exchange.

“ Applicable Rate ” means a rate per annum (carried out to the fifth decimal place) equal to the offered rate that appears on a specified date (or, if it does not appear on such specified date, on the next preceding date on which it does appear) on the page of the Telerate Screen that displays an average British Banker’s Association Interest Settlement Rate for deposits in the applicable currency with a term of 180 days, plus 25 basis points.

“ Approved Sale ” has the meaning set forth in Section 7.2.

“ Approved Sale Notice Date ” means the date on which notice is given to the Unilever Stockholder of an Approved Sale, which notice shall not be given more than 30 calendar days prior to the date the parties enter into a definitive and binding agreement for such Approved Sale.

“ Assumption Agreement ” means an agreement in substantially the form of Exhibit 2 .

“ Audit Committee Charter ” means the statement of authority and powers of the Audit Committee of the Board as set forth in Part A of Exhibit 12 , which was adopted at the first regular meeting of the Board following the Closing Date, as such charter may be amended from time to time, subject to Section 4.10(a)(xiii).

“ Bankruptcy Event ” has the meaning set forth in Section 4.14.

“ Bankruptcy Laws ” has the meaning set forth in Section 4.14.

“ Base Value ” means the enterprise value of the Company Group, determined as of the last day of the applicable Measurement Period, as may be agreed to by the Unilever Stockholder and the Company or as otherwise determined pursuant to Sections 8.9, 8.10 and 8.11 in accordance with the Valuation Principles; provided , however , that the Base Value shall not be less than eight times the Applicable EBITDA.

 

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“ beneficial owner ,” “ beneficially own ” and “ beneficial ownership ” means, with respect to any securities, (a) securities that the designated Person or any of such Person’s Affiliates is deemed to “beneficially own” within the meaning of Rule 13d-3 under the Exchange Act, as in effect on the date of this Agreement, and (b) any securities that such Person or any of such Person’s Affiliates has the right to acquire (whether such right is exercisable immediately or only after the passage of time) pursuant to any agreement, arrangement or understanding (written or oral), or upon the exercise of conversion rights, exchange rights, rights, warrants or options or otherwise (it being understood that such Person will also be deemed to be the beneficial owner of the securities convertible into or exchangeable for such securities).

“ Board ” means the Board of Directors of the Company.

“ Brand License Agreement ” has the meaning set forth in Section 7.3.

“ Business ” means (a) the business of manufacturing, marketing, distributing, developing and selling building maintenance, cleaning, pest elimination, laundry, warewashing, food hygiene and sanitation products, plastic additives and polymer intermediates to, or for ultimate use by, Customers, and (b) the business of developing, marketing, selling and providing facilities maintenance services for Professional End-Users. Without limiting the generality of the foregoing, the Business shall include the DiverseyLever Business (as defined in the Purchase Agreement).

“ Business Day ” means a day that is not a Saturday, Sunday or other day on which commercial banking institutions in New York City, Amsterdam or London are authorized or required by Applicable Law to be closed; provided , that the days beginning on an including December 21 of each year and ending on and including January 2 of each year shall not constitute Business Days.

“ Business Plan ” has the meaning set forth in Section 4.11.

“ Business Plan Meeting ” has the meaning set forth in Section 4.11.

“ Bylaws ” has the meaning set forth in Section 2.1.

“ Call Closing ” has the meaning set forth in Section 8.6.

“ Call Closing Date ” has the meaning set forth in Section 8.6.

“ Call Notes ” has the meaning set forth in Section 8.5.

“ Call Notice ” has the meaning set forth in Section 8.5.

“ Call Option ” has the meaning set forth in Section 8.5.

“ Call Shares ” has the meaning set forth in Section 8.5.

 

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“ Cash ” means the cash (or cash equivalents) balance of the Company Group as of the last day of the applicable Measurement Period (measured on a consolidated basis in accordance with GAAP).

“ Certificate ” has the meaning set forth in Section 2.1.

“ Certified Applicable EBITDA ” has the meaning set forth in Section 8.10.

“ Certified Base Value ” has the meaning set forth in Section 8.11.

“ Certified Cash Flows ” has the meaning set forth in Section 8.10.

“ Chairman ” means the chairman from time to time of the Board.

“ Charter Documents ” means the Certificate and the Bylaws.

“ Chief Executive Officer ” means the chief executive officer from time to time of the Company.

“ Chief Financial Officer ” means the chief financial officer from time to time of the Company.

“ Class A Common Stock ” means (a) the Class A Common Stock, par value $0.01 per share, of the Company, and (b) any equity securities issued with respect to any such Class A Common Stock by way of a stock dividend or stock split, or in connection with a combination of shares, recapitalization, merger, consolidation, or other reorganization, or otherwise.

“ Class A Shares ” means shares of Class A Common Stock.

“ Class B Common Stock ” means (a) the Class B Common Stock, par value $0.01 per share, of the Company, and (b) any equity securities issued with respect to any such Class B Common Stock by way of a stock dividend or stock split, or in connection with a combination of shares, recapitalization, merger, consolidation, or other reorganization, or otherwise. The Class B Common Stock shall have a liquidation preference equal to the Share Price (the “ Class B Liquidation Preference ”). The Class B Common Stock shall be identical to the Class A Common Stock in all respects, other than the Class B Liquidation Preference.

“ Class B Shares ” means shares of Class B Common Stock.

“ Closing Date ” means May 3, 2002.

“ CMI ” has the meaning set forth in the second recital to this Agreement.

“ CMI Business ” shall mean (a) the business of manufacturing, marketing, distributing, developing and selling building maintenance, cleaning, pest elimination, laundry, warewashing, food hygiene and sanitation products, plastic additives and polymer intermediates to Customers, and (b) the business of developing, marketing, selling and providing facilities maintenance services for Professional End-Users, in the case of (a) and (b), as conducted by the

 

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Company, its Subsidiaries (excluding, prior to the Closing Date, the “Companies” sold to the Company pursuant to the Purchase Agreement, but including them thereafter) and any other Persons that are controlled, directly or indirectly, by the Company.

“ Common Stock ” means the Class A Common Stock and Class B Common Stock.

“ Common Stock Equivalents ” means any options, warrants or other rights, agreements, arrangements or commitments of any character obligating the Company or any of its Subsidiaries to issue or sell any shares of capital stock of or other equity interests in the Company or any of its Subsidiaries, or any securities or obligations convertible into, or exchangeable for, any such shares of capital stock or other equity interests, or obligating the Company or any of its Subsidiaries to grant, extend, or enter into any such right, agreement, arrangement or commitment, other than the issuance of any of the foregoing by any Subsidiary of the Company to the Company or any other Subsidiary of the Company.

“ Company ” has the meaning set forth in the introductory paragraph to this Agreement.

“ Company Group ” means the Company and any Subsidiaries of the Company from time to time.

“ Company Group Member ” means any member of the Company Group.

“ Compensation Committee Charter ” means the statement of authority and powers of the Compensation Committee of the Board as set forth in Part B of Exhibit 12 , which was adopted at the first regular meeting of the Board following the Closing Date, as such charter may be amended from time to time, subject to Section 4.10(a)(xii).

“ Confidential Information ” has the meaning set forth in Section 6.4.

“ Confidentiality Agreements ” means the Letter Agreement, dated as of December 20, 2000, between Unilever United States, Inc. and CMI, as amended, and the Joint Defense Agreement, dated as of June 1, 2001, between Unilever NV, Unilever PLC and CMI.

“ Conflicting Provisions ” has the meaning set forth in Section 10.16.

“ Conopco ” has the meaning set forth in the second recital to this Agreement.

“ Contingent Payment Amount ” has the meaning set forth on Exhibit 9 .

“ control ” means the possession, directly or indirectly, of the power to direct or cause the direction of the management, policies or activities of another Person whether through the ownership of securities, by contract or agency, or otherwise, it being understood, without prejudice to the generality of the foregoing, that a Person shall be presumed to have control of an Entity when such Person has direct or indirect ownership of more than 50% of the Total Voting Power or general partnership interests or voting interests in such Entity, and the terms “ controlling ,” “ controlled by ” and “ under common control with ” shall be construed accordingly.

 

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“ Credit Agreement ” means the Credit Agreement, dated as of the Closing Date, among S.C. Johnson Commercial Markets, Inc., Johnson Wax Professional, Inc., a company organized under the laws of Canada, Johnson Professional Co., Ltd., a company organized under the laws of Japan, and Johnson Diversey Netherlands II B.V., a company organized under the laws of the Netherlands, each as a borrower, Johnson Professional Holdings, Inc., the lenders and issuers party thereto, as lenders, Citicorp USA, Inc., as administrative agent for such lenders, Goldman Sachs Credit Partners L.P., as syndication agent for the Senior Lenders, and ABN Amro Bank N.A., Bank One N.A., Royal Bank of Scotland PLC, New York Branch and General Electric Capital Corporation, each as a co-documentation agent for such lenders, as amended, restated, supplemented or otherwise modified from time to time.

“ Credit Documents ” means the Credit Agreement and any and all notes, guarantees, security agreements, pledge agreements, mortgages, deposit account control agreements, fee letters, letter of credit reimbursement agreements, foreign exchange or currency swap agreements, each hedging contract to which the Company, or a subsidiary of the Company, and a lender under the Credit Agreement (or an affiliate) is a party, each agreement pursuant to which a lender under the Credit Agreement (or an affiliate) provides cash management services to the Company, or a subsidiary of the Company, other agreements delivered by the Company, or a subsidiary of the Company, granting a lien on or security interest in any of its property to secure payment of the Company’s, or such subsidiary’s, obligations under the Credit Agreement other documents, instruments or agreements entered into in connection with or pursuant to the foregoing, and any and all documents, instruments or agreements evidencing or securing the amendment, refinancing, modification, replacement, renewal, restatement, refunding, deferral, extension, supplement, reissuance or resale thereof.

“ Cumulative Special Funding Adjustment ” means the amount of contributions paid, during the period beginning on the Closing Date and ending on the last day of the applicable Measurement Period, in respect of an unfunded pension arrangement to a fund for the purpose of prefunding such benefits as are provided under the unfunded pension arrangements, other than as may be required by Applicable Law. All such contributions in a local jurisdiction shall initially be expressed in the relevant local currency but shall be converted into dollars as of the last day of each Fiscal Year (and, if the applicable Measurement Period is not a Fiscal Year, the last day of such Measurement Period). Each such conversion shall be calculated using (1) the applicable exchange rate as published in the “Cross-Rates and Derivatives: Exchange Cross-Rates” (or any successor column), as appearing in the Financial Times on the last day of the applicable Fiscal Year or Measurement Period, or (2) if the Financial Times is not published or such column does not appear on such date, the applicable exchange rate on the immediately preceding date on which the Financial Times is so published and such column appears, or (3) if an exchange rate for the relevant local currency is not so published, such rate as the Company’s independent auditors and Unilever’s independent auditors shall mutually agree by reference to generally accepted, published exchange rates for such currency into dollars as at, or as near as possible to, the last day of the applicable Fiscal Year or Measurement Period.

“ Customer ” means (a) Professional End-Users and (b) any wholesaler, distributor, “cash and carry” outlet or similar reseller who purchases products sold by the Business, in each case described in clause (b), for the purpose of resale, either directly or indirectly, to Professional End-Users.

 

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“ DGCL ” means the Delaware General Corporation Law, as amended from time to time.

“ Directors ” means the members of the Board.

“ DiverseyLever Business Products ” means (a) fabric care products, (b) machine warewashing products, (c) kitchen cleaning products, (d) personal care products, (e) building care products (including floorcare, washroom and roomcare cleaning products), (f) pest control products, (g) air cleaning products, (h) vehicle cleaning products, (i) open plant cleaning products, (j) commercial bottlewashing products, (k) track treatment products, (l) cleaning and hygiene products for intensive livestock, food and beverage processing and packaging, pasteurizer treatment, agriculture and dairy applications, (m) commercial floorcare and carpet care machines (including parts and accessories therefor), (n) cleaning and hygiene utensils and paper products for use by Professional End-Users (including tools, pads, cloths, cutting boards and the like), (o) commercial membrane cleaning products, (p) commercial cleaning in place products, (q) industrial water treatment products, (r) industrial lubricant, paper manufacturing, industrial surface cleaning and treatment, industrial maintenance and cleaning and other specialty manufacturing products, and (s) equipment used to dispense, dose, monitor or control any of the foregoing.

“ Early Unilever Sale ” has the meaning set forth in Section 7.3.

“ Early Unilever Sale Period ” has the meaning set forth in Section 7.3.

“ EBITDA ” has the meaning set forth on Exhibit 4 .

“ Eighth Year ” means the eighth anniversary of the Closing Date.

“ Eighth Year Action ” has the meaning set forth in Section 8.13.

“ Eighth Year Put Closing Date ” has the meaning set forth in Section 8.3.

“ Election Meeting ” means any Stockholders Meeting held or to be held for the purpose of electing a Director or Directors to the Board.

“ Entity ” means any general partnership, limited partnership, corporation, association, cooperative, joint stock company, trust, limited liability company, business trust, joint venture, unincorporated organization or governmental entity (or any department, agency or political subdivision thereof).

“ Exchange Act ” means the Securities Exchange Act of 1934, as amended.

“ Exit Note ” shall mean a subordinated promissory note of the Company dated as of the Eighth Year Put Closing Date (a) in an aggregate principal amount equal to the Share Price as of the Eighth Year Put Closing Date, (b) bearing interest from the Eighth Year Put Closing Date to the maturity date at the Applicable Rate as of the Eighth Year Put Closing Date, payable in arrears on the maturity date, (c) having a final maturity date of (i) if the Unilever Stockholder’s Ownership Interest on the Eighth Year Put Closing Date is 10% or less, 1 year

 

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from the Eighth Year Put Closing Date, or (ii) if the Unilever Stockholder’s Ownership Interest on the Eighth Year Put Closing Date is more than 10%, 90 days from the Eighth Year Put Closing Date, and (d) providing for the terms and conditions, including, without limitation, the terms relating to ranking, subordination covenants, other terms and rights and remedies relative to other creditors of the Company Group, set forth on Exhibit 3 . The holder of the Exit Note shall not transfer such Note to any other Person except (x) a Unilever Group Member of which Unilever has Unilever Required Control (subject to compliance with Sections 7.3 and 7.4, which Sections shall apply, mutatis mutandi , to the Exit Note), or (y) a Person that is previously approved in writing by the Company, which approval may be granted or withheld in the Company’s sole discretion.

“ Experts ” has the meaning set forth in Section 8.11.

“ Fair Market Value ” means (a) (i) the Base Value, minus (ii) the Net Debt Amount (or, if the Net Debt Amount is a negative number, plus the absolute value of the Net Debt Amount), minus (iii) all Repurchase Expenses to the extent not otherwise reflected in the Net Debt Amount and incurred on or prior to the applicable Put Closing Date or Call Closing Date, plus (iv) $90 million multiplied by (b) (i) the number of Unilever Shares to be purchased by the Company, divided by (ii) the total number of issued and outstanding Shares (on a Fully-Diluted basis) on the date the Initial Put Notice or Call Notice, as the case may be, is given.

“ Final Exit Date ” means the date on which (a) the Company consummates the purchase from the Unilever Stockholder of Unilever Shares (whether for cash or in exchange for the Exit Note) in accordance with (i) the Unilever Stockholder’s exercise of its Put Option, or (ii) the Company’s exercise of its Call Option, or (b) the sale of Unilever Shares pursuant to an Approved Sale, Unilever Sale, Early Unilever Sale, Private Placement or other permitted Transfer is consummated, in each case such that immediately following such purchase or sale the Unilever Stockholder ceases to own any Class B Shares.

“ Financial Advisors ” has the meaning set forth in Section 8.9.

“ Financial Expert ” has the meaning set forth in Section 8.11.

“ Financing Agreements ” means (a) the Credit Agreement and any Credit Document, (b) the 144A Notes and the 144A Notes Indenture, (c) the Note and the Note Indenture, (d) the Accounts Receivable Securitization Facility, (e) any other documents, indentures, notes, instruments and agreements entered into by the Company or any of its Subsidiaries (i) in connection with the 144A Notes and the 144A Notes Indenture, or (ii) on or prior to the date hereof, in connection with the Credit Agreement, the Note, the Note Indenture, the Accounts Receivable Securitization Facility or the transactions contemplated thereby, and (f) subject to the second proviso to Section 4.10(c)(i), any other documents, indentures, notes, instruments or agreements entered into in connection with a Refinancing, in the case of (a) through (f) above, as amended, restated, supplemented or otherwise modified from time to time.

“ First Offer Closing Date ” has the meaning set forth in Section 7.3.

“ First Offer Notice ” has the meaning set forth in Section 7.3.

 

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“ First Offer Price ” has the meaning set forth in Section 7.3.

“ First Offer Sale ” has the meaning set forth in Section 7.3.

“ Fiscal Quarter ” means each three-month period ending on the Friday nearest, in each case, March 31, June 30, September 30 or December 31, as the case may be.

“ Fiscal Year ” means the 12-month period ending on the Friday nearest June 30 or any other comparable date on which a Fiscal Quarter ends, as fixed by the Board from time to time for annual fiscal reporting purposes.

“ Fixed Price Date ” has the meaning set forth in Section 8.2.

“ Full Representation Holding ” means the beneficial ownership of Class B Shares representing in the aggregate at least 20% of the outstanding Shares.

“ Fully-Diluted ” means giving effect to the exercise or conversion of, or otherwise giving effect to the existence, on a pro forma basis, of any Common Stock Equivalents (other than Common Stock Equivalents which are convertible into, or exercisable or exchangeable for, Common Stock at a price greater than the Base Value for the applicable Measurement Period on a per share basis assuming only the Shares are outstanding) issued in accordance with Section 4.10, and assuming that such Common Stock Equivalents were exercised or converted.

“ Funded Indebtedness ” of the Company Group means on any date an amount equal to the aggregate outstanding principal amount of Indebtedness; provided , however , that Indebtedness in respect of the Note shall be excluded from the amount referred to above.

“ GAAP ” means U.S. generally accepted accounting principles, as in effect from time to time, consistently applied.

“ Governmental Authority ” means any governmental department, commission, board, bureau, agency, court, regulatory body or other instrumentality of competent jurisdiction of the United States, the European Union or any other country, or any state, region, jurisdiction, municipality or other political subdivision of a country or any other supranational organization of sovereign states.

“ Group ” means the Holdco Group, the Unilever Group or the Company Group, as the case may be.

“ Holdco ” has the meaning set forth in the introductory paragraph of this Agreement.

“ Holdco Directors ” means Helen Johnson Leipold, S. Curtis Johnson, Clifford Louis and Gregory E. Lawton, each of whom is currently serving as a Director as of the date hereof, and any other Directors nominated by the Holdco Stockholder pursuant to Section 4.3(a)(ii).

 

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“ Holdco Group ” means Holdco, its Affiliates from time to time and Johnson Family Members.

“ Holdco Group Member ” means any member of the Holdco Group.

“ Holdco Note Indebtedness ” has the meaning set forth in Section 4.10(c)(v).

“ Holdco Required Control ” means, with respect to a Person, (a) (i) if a corporation, the aggregate beneficial ownership by Holdco of securities representing at least 80% of the Total Voting Power in such Person and (ii) if an Entity other than a corporation, the aggregate beneficial ownership by Holdco of at least 80% of the partnership or other similar voting interest, and (b) the right to elect a majority of such Person’s board of directors or comparable governing body.

“ Holdco Shares ” means the Class A Shares originally issued to or hereafter acquired by any Holdco Group Member.

“ Holdco Stockholder ” means, collectively, the Holdco Group Members who from time to time hold Class A Shares.

“ Incumbent Independent Directors ” has the meaning set forth in the definition of “Independent Director” herein.

“ Incur ” means, with respect to any Indebtedness, to create, issue, incur (by merger, conversion, exchange or otherwise), assume, guarantee or become liable in respect of, or create any obligation to pay, such Indebtedness (and “ Incurrence ” and “ Incurred ” shall have meanings correlative to the foregoing); provided , however , that a change in GAAP that results in an obligation of the Company Group that exists at such time, and is not therefore classified as Indebtedness, becoming Indebtedness shall not be deemed an Incurrence of such Indebtedness; provided , further , that any indebtedness of a Person existing at the time such Person becomes a Subsidiary of the Company shall be deemed to be Incurred by such Subsidiary at the time it becomes a Subsidiary of the Company; and provided , further , that amortization of discount of Indebtedness sold at a discount shall not be deemed to be the Incurrence of Indebtedness.

“ Indebtedness ” means the aggregate amount for the Company Group of all borrowings and indebtedness in the nature of borrowings (including, without limitation, financing, acceptance credits, borrowings under letter of credit facilities and similar transactions, discounting or similar facilities, finance leases, capital leases, loan stocks, bonds, debentures, notes, debt or inventory financing, sale and lease back arrangements, obligations incurred in connection with the acquisition of, or as the deferred purchase price for, property, assets or businesses, overdrafts, net obligations under any accounts receivable financing or securitization transactions, net obligations arising from hedging arrangements in respect of interest rates, currencies or raw materials or other commodities, whether or not accounted for on the balance sheet, or any other arrangements the purpose of which is to raise money, and all obligations of the type referred to above of other Persons the payment of which a Company Group Member is responsible for or liable (including as co-obligor, guarantor or otherwise), in each case to the extent of such responsibility or liability), in each case as reflected in the financial statements of the Company in accordance with GAAP or, if no financial statements are available as of the

 

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applicable date, as would be required to be so reflected on such financial statements prepared as of such date in accordance with GAAP, but excluding (a) trade and other accounts payable incurred in the ordinary course of business, and (b) obligations with respect to letters of credit securing obligations entered into in the ordinary course of business of the relevant Company Group Member to the extent such letters of credit are not drawn upon or, if and to the extent drawn upon, such drawing is reimbursed no later than the third Business Day following receipt by such Company Group Member of a demand for reimbursement following payment on the letter of credit.

“ Indebtedness to EBITDA Ratio ” means (a) the sum of (i) Funded Indebtedness as of the last day of the applicable Measurement Period (except to the extent such Indebtedness is to be repaid and/or refinanced in connection with a Refinancing on such day and is included in clause (ii) below), and (ii) all additional Funded Indebtedness incurred or to be incurred in connection with the applicable Refinancing as if such Refinancing had occurred on such day, divided by (b) the Applicable EBITDA.

“ Indemnified Documents ” shall mean (a) any registration statement (and any amendment or supplement thereto) under the Securities Act (“ Registration Statement ”), including any related preliminary prospectus or final prospectus, and exhibits and schedules thereto, (b) any information, documents and reports filed pursuant to the Exchange Act, and (c) any preliminary or final offering memorandum or other document provided to prospective investors and pursuant to which the Company offers and sells securities and under which there is liability under the Securities Act or the Exchange Act, in each case of or by any member of the Company Group and as amended or supplemented from time to time.

“ Independence Questionnaire ” means a director questionnaire signed by an Independent Director or an individual proposed to be nominated as an Independent Director assessing the criteria set forth in the definition of “Independent Director” herein with respect to such Director or nominee.

“ Independent Director ” means an individual other than (a) an officer or employee of the Company or any of its Subsidiaries, or (b) any other individual having a relationship which, in the opinion of the Board, would interfere with the exercise of independent judgment in carrying out the responsibilities of a Director, in each case at the time of his or her nomination and at any time thereafter. Except to the extent the Unilever Stockholder shall have waived in writing any of the criteria set forth below with respect to a particular individual nominated or elected to serve as an Independent Director (an “ Independence Criteria Waiver ”), the following individuals shall not be considered independent:

(i) a Johnson Family Member;

(ii) an individual who is a member of the immediate family of a lineal descendant of Herbert F. Johnson Jr. or Henrietta Johnson Louis.;

(iii) an individual who is employed by a Related Person or who has been employed by a Related Person at any time during the past two years;

 

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(iv) an individual who accepts any compensation from a Related Person in excess of $60,000 during the previous Fiscal Year, other than (a) compensation for board service, or (b) benefits under a retirement plan or program;

(v) an individual who is a member of the immediate family of an individual who is, or has been in any of the past three years, employed by a Related Person as an officer;

(vi) an individual who is a partner in, or a controlling shareholder or an executive officer of, any for-profit business organization to which a Related Person made, or from which a Related Person received, payments (other than those arising solely from investments in such Related Person’s securities) that exceed 5% of such Related Person’s or business organization’s consolidated gross revenues for that year, or $200,000, whichever is more, in any of the past two years; and

(vii) an individual who is employed as an executive officer of another Entity where any of the Company’s executive officers serve on that Entity’s compensation committee.

Notwithstanding the foregoing, (x) Todd Brown, Irene M. Esteves, Robert M. Howe, Neal Nottleson and Reto Wittwer, each of whom is, as of the date hereof, serving, or has agreed to serve, as a Director (the “ Incumbent Independent Directors ”), shall be deemed to be “Independent Directors,” as of the date hereof and thereafter, and (y) no Unilever Director shall be deemed to be an “Independent Director.” Except as otherwise agreed by the Holdco Stockholder and the Unilever Stockholder, an Independence Criteria Waiver, once given, shall remain in full force and effect as to the Director to which it relates to the extent and scope of the specific criteria so waived for the full term of such Director’s service as Director of the Company, and any renewal terms thereof. For purposes of this definition, “ immediate family ” means a person’s spouse, parents, children, siblings, mother-in-law, father-in-law, brother-in-law, sister-in-law, son-in-law, daughter-in-law and any other relative who resides in such person’s home.

“ Initial Unilever Proposals ” has the meaning set forth in Section 8.9.

“ Initial EBITDA Proposal ” has the meaning set forth in Section 8.9.

“ Initial Put Notice ” has the meaning set forth in Section 8.1.

“ Initial Sale Period ” means (a) May 3, 2007 through the later of (i) May 3, 2008 and (ii) February 3, 2009, if the Unilever Stockholder shall have delivered a First Offer Notice to the Company by May 3, 2008, and (b) if the Unilever Stockholder shall not have delivered a First Offer Notice to the Company by May 3, 2008 pursuant to Section 7.3(g), the period commencing on the termination of the Initial Put Notice and ending on May 3, 2010.

“ Initial Valuation Proposal ” has the meaning set forth in Section 8.9.

“ Intellectual Property ” means all intellectual property, including, without limitation, (a) all patents, industrial and utility models and registered designs, including applications, provisional applications, reissues, divisions, continuations, continuations-in-part,

 

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renewals, re-examinations and extensions of the foregoing, and all forms of protection of a similar nature or having equivalent or similar effect to any of these that may subsist anywhere in the world, (b) trademarks, service marks, proprietary rights in trade names, trade dress, domain names, labels, logos, slogans and all other devices used to identify any product, service, business or company whether registered, unregistered or at common law, and any applications for registration or registrations thereof and all forms of protection of a similar nature or having equivalent or similar effect to any of these that may subsist anywhere in the world, (c) all proprietary know-how and trade secrets (including anything deemed a “trade secret” as defined under the Delaware Uniform Trade Secret Act (D EL . C ODE A NN . tit. 6, §§ 2001 et seq. (2000))) held in any form, including all product specifications, processes, formulas, product designs, plans, ideas, concepts, inventions, manufacturing, engineering and other manuals and drawings, technical information, data, research records, customer and supplier lists and similar data and information, and all other confidential or proprietary technical and business information and (d) all copyrights and database rights (whether registered or unregistered and including applications for the registration of any such thing) and unregistered design rights and all forms of protection of a similar nature or having equivalent or similar effect to any of these which may subsist anywhere in the world.

“ Japan Business ” has the meaning set forth in Section 8.13.

“ Johnson Family Member ” means (a) a lawful lineal descendant of Herbert F. Johnson, Jr. or Henrietta Johnson Louis or the spouse of any such person; (b) an estate, trust (including a revocable trust, declaration of trust or a voting trust), guardianship or custodianship for the primary benefit of one or more individuals described in clause (a) above; and (c) an Entity controlled by one or more individuals or entities described in clauses (a) or (b) above; provided , however , that, for purposes of this Agreement, no Company Group Member shall be regarded as a Johnson Family Member. For the avoidance of doubt, S.C. Johnson & Son, Inc. and its Subsidiaries are, as of the date hereof, Johnson Family Members.

“ Management Plan Documents ” means the Commercial Markets Holdco, Inc. Amended and Restated Long-Term Equity Incentive Plan (the “ Holdco Plan ”), the Long Term Incentive Plan Operating Provisions – Senior Executive under the Holdco Plan and the form of Employment Agreement under the Holdco Plan.

“ Marga ” has the meaning set forth in the introductory paragraph of this Agreement.

“ Material Legal Proceeding ” means any Legal Proceeding (as defined in the Purchase Agreement) involving amounts that are not covered by insurance and are in excess of $10   million, other than any Legal Proceeding to which any Unilever Group Member is or is proposed to be a party opposed or having any interest adverse to, directly or indirectly, the Company Group Member which is a party to such Legal Proceeding.

“ Measurement Period ” means:

(a) for purposes of any exercise of the Put Option, the twelve-month period ending on the last day of the most recent Fiscal Quarter covered by the most recent

 

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financial statements delivered by the Company pursuant to Section 6.1(b) or (c) on or prior to the date on which such Put Option is exercised, subject to clause (x) of Section 8.4(d);

(b) for purposes of any exercise of the Call Option, the twelve-month period ending on the last day of the most recent Fiscal Quarter covered by the most recent financial statements delivered by the Company pursuant to Section 6.1(b) or (c) on or prior to the date on which such Call Option is exercised, subject to the proviso to Section 8.5(a) and the proviso to Section 8.5(b); and

(c) for purposes of an Approved Sale, the twelve-month period ending on the last day of the most recent Fiscal Quarter immediately preceding the Approved Sale Notice Date.

For the avoidance of doubt, unless the Share Price is fixed in accordance with Section 8.4(d) or 8.5(a) or (b), the Measurement Period shall be reset each time a Put Notice or Call Notice is given or deemed given.

“ Minimum Representation Holding ” means the beneficial ownership of Class B Shares representing in the aggregate at least 5% of the outstanding Shares.

“ Net Debt Amount ” means Applicable Indebtedness, minus Cash, and as adjusted in accordance with Exhibit 11 .

“ Net Periodic Pension Cost ” means net periodic pension cost as determined on a FAS 87, FAS 106 or FAS 112 basis as applicable (or if these accounting standards are not applicable, using principles consistent with these accounting standards) using the projected unit credit method.

“ Net Proceeds ” means the net proceeds, after payment of all Repurchase Expenses, of a Refinancing, any action in connection with a Partial Repurchase or an Eighth Year Action, as the case may be.

“ New Agency Agreement ” has the meaning set forth in Section 8.16.

“ New Material Benefit Plan ” has the meaning set forth in Section 4.10.

“ Non-Arm’s Length Terms ” has the meaning set forth in Exhibit 4 .

“ Notes ” means the 10.67% Senior Discount Notes due 2013 of the Company issued on the Closing Date, and any “Special Interest Notes” (as defined in the Notes Indenture) issued in accordance with the terms of Exhibit A to the Registration Rights Agreement dated as of the Closing Date between the Company and Unilever N.V.

“ Notes Indenture ” means the Indenture dated as of the Closing Date between the Company and BNY Midwest Trust Co., as trustee, providing for the issuance of the Notes, as amended or supplemented from time to time.

 

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“ Notice Period ” means the period commencing on the date on which the Company delivers financial statements pursuant to Section 6.1(b) or (c) and ending 20 Business Days after such date.

“ Noticed Shares ” has the meaning set forth in Section 7.3.

“ Ordinary Course of Business ” means, in relation to any part of the DiverseyLever Business or the CMI Business, as the case may be, the ordinary and usual course of operations of the DiverseyLever Business or the CMI Business, as the case may be, consistent with past practice.

“ Ownership Interest ” means, with respect to a Stockholder, the number of Shares beneficially owned by such Stockholder divided by the total number of Shares then outstanding.

“ Partial Put Notice ” has the meaning set forth in Section 8.4.

“ Partial Repurchase ” means (a) the repurchase by the Company of less than all the Unilever Shares and Notes, in each case then beneficially owned by the Unilever Stockholder following the exercise by the Company of the Call Option pursuant to Section 8.5 or (b) the repurchase by the Company of less than all the Put Securities following the exercise by the Unilever Stockholder of a Put Option pursuant to Section 8.1.

“ Partially Put Securities ” means the portion of the Put Securities that (a) has an aggregate Put Price equal to the Net Proceeds described in the first sentence of Section 8.4(d), and (b) comprise either (i) solely Put Shares or (ii) (A) a number of Put Shares equal to the total number of Put Shares multiplied by the Partial Put Percentage, and (B) Put Notes with an aggregate Accreted Value equal to the aggregate Accreted Value of all the Put Notes multiplied by the Partial Put Percentage, in each case rounded down to the nearest whole number. For purposes of this definition, the “ Partial Put Percentage ” shall be equal to (1) the amount of the Net Proceeds described in the first sentence of Section 8.4(d), divided by (2) the aggregate Put Price for all the Put Securities.

“ Pension Differential Contribution ” means, in respect of a full or partial Fiscal Year during the period beginning on the Closing Date and ending on the last day of the applicable Measurement Period for each funded defined benefit Pension plan in which the Company or any of its Subsidiaries participates, the amount determined by multiplying (a) (i) the amount of any employer contribution made during such full or partial Fiscal Year to such funded defined benefit Pension plan, minus (ii) the Net Periodic Pension Cost for such full or partial Fiscal Year for such plan, by (b) one minus the tax rate applicable in the jurisdiction in question to the contribution so made. Each Pension Differential Contribution may be either a positive or negative amount. Each Pension Differential Contribution shall initially be expressed in the relevant local currency but shall be converted into dollars as of the last day of each Fiscal Year (and, if the applicable Measurement Period is not a Fiscal Year, the last day of such Measurement Period). Each such conversion shall be calculated using (1) the applicable exchange rate as published in the “Cross-Rates and Derivatives: Exchange Cross-Rates” (or any successor column), as appearing in the Financial Times on the last day of the applicable Fiscal Year or Measurement Period, or (2) if the Financial Times is not published or such column does

 

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not appear on such date, the applicable exchange rate on the immediately preceding date on which the Financial Times is so published and such column appears, or (3) if an exchange rate for the relevant local currency is not so published, such rate as the Company’s independent auditors and Unilever’s independent auditors shall mutually agree by reference to generally accepted, published exchange rates for such currency into dollars as at, or as near as possible to, the last day of the applicable Fiscal Year or Measurement Period. For purposes of this definition, “ Pension ” means defined benefit pension and other similar post-retirement benefit obligations.

“ Pension Plan Amendment ” means the amendment, without the Unilever Stockholder’s prior written consent, of benefit levels provided under a Shared Pension Plan, which amendment results in an increase in the Net Periodic Pension Cost of benefits of the Company Group under such Plan in excess of 10% of the Prior Net Periodic Pension Cost, calculated using the same assumptions, methodology and funded status of such Plan as was used to calculate such Prior Net Periodic Pension Cost and exclusive of any increases (including healthcare premium, prescription plan and other provider costs) attributable to general market increases in the cost of providing the same or comparable benefits or third party cost and premium increases applicable to then existing terms and conditions.

“ Pension Plan Amendment Adjustment ” means the cumulative aggregate amount, without duplication, of all Pension Plan Amendment Differential Costs incurred by the Company Group prior to the last day of the applicable Measurement Period, other than any such Pension Plan Amendment Differential Costs, the effect of which is or has been at any time eliminated from Applicable EBITDA in accordance with Exhibit 4 .

“ Pension Plan Amendment Differential Costs ” means, in respect of a full or partial Fiscal Year prior to the last day of the applicable Measurement Period, the amount of the increased cost of benefits under a Shared Pension Plan (a) resulting from a Pension Plan Amendment and (b) in excess of 10% of the Prior Net Periodic Pension Cost, calculated using the same assumptions, methodology and funded status and exclusive of any increases (including healthcare premium, prescription plan and other provider costs) attributable to general market increases in the cost of providing the same or comparable benefits or third party cost and premium increases applicable to then existing terms and conditions. Each Pension Plan Amendment Differential Cost shall initially be expressed in the relevant local currency but shall be converted into dollars as of the last day of each Fiscal Year (and, if the applicable Measurement Period is not a Fiscal Year, the last day of such Measurement Period). Each such conversion shall be calculated using (1) the applicable exchange rate as published in the “Cross-Rates and Derivatives: Exchange Cross-Rates” (or any successor column), as appearing in the Financial Times on the last day of the applicable Fiscal Year or Measurement Period, or (2) if the Financial Times is not published or such column does not appear on such date, the applicable exchange rate on the immediately preceding date on which the Financial Times is so published and such column appears, or (3) if an exchange rate for the relevant local currency is not so published, such rate as the Company’s independent auditors and Unilever’s independent auditors shall mutually agree by reference to generally accepted, published exchange rates for such currency into dollars as at, or as near as possible to, the last day of the applicable Fiscal Year or Measurement Period.

 

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“ Permitted Transferee ” means any Person to whom Shares are Transferred in a Transfer not in violation of this Agreement and who is required to, and does, enter into an Assumption Agreement and become bound by the terms of this Agreement, and includes any Person to whom a Permitted Transferee of any Stockholder (or a Permitted Transferee of a Permitted Transferee) further Transfers Shares and who is required to, and does, enter into an Assumption Agreement and become bound by the terms of this Agreement.

“ Person ” means any individual or Entity, and the heirs, executors, administrators, legal representatives, successors and assigns of such individual or Entity.

“ Polymer ” means Johnson Polymer, LLC, a Wisconsin limited liability company and a wholly-owned subsidiary of CMI, together with its Subsidiaries.

“ Polymer Business ” has the meaning set forth in Section 8.13.

“ Post Measurement Period Special Program ” has the meaning set forth in Exhibit 4 .

“ Pre-Closing Period ” means the period commencing on the date an Initial Put Notice or Call Notice, as the case may be, is given in accordance with this Agreement, and ending on the applicable Put Closing Date or Call Closing Date.

“ Premium ” has the meaning set forth in Section 7.3.

“ Primary Structure ” has the meaning set forth in Section 7.9.

“ Prior Net Periodic Pension Cost ” means the Net Periodic Pension Cost of benefits of the Company Group under a Shared Pension Plan for the Fiscal Year preceding a Pension Plan Amendment.

“ Private Placement ” has the meaning set forth in Section 8.13.

“ Professional End-Users ” means commercial, industrial or institutional or other non-domestic end-users.

“ Public Offering ” means the sale, either in an SEC registered public offering or a Rule 144A offering, of equity securities of the Company resulting in net proceeds to the Company in excess of $20 million, and listing of such equity securities on one or more national securities exchanges, the NASDAQ National Market System or equivalent exchanges.

“ Purchase Agreement ” has the meaning set forth in the second recital to this Agreement.

“ Put Closing ” has the meaning set forth in Section 8.3.

“ Put Closing Date ” has the meaning set forth in Section 8.3.

“ Put Notes ” has the meaning set forth in Section 8.1.

 

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“ Put Notice ” has the meaning set forth in Section 8.1.

“ Put Option ” has the meaning set forth in Section 8.1.

“ Put Price ” has the meaning set forth in Section 8.2.

“ Put Securities ” has the meaning set forth in Section 8.1.

“ Put Shares ” has the meaning set forth in Section 8.1.

“ Qualified Candidate ” means, with respect to any Person, (a) the chief executive officer, chief operating officer, chief financial officer, chief administrative officer, any senior vice president, any executive vice president or any member of the board of directors of such Person, or (b) any other individual who would be an Independent Director, but for the provisions of clause (y) of the definition of such term. A Unilever Director shall cease to remain a Qualified Candidate and shall be replaced by the Unilever Stockholder if such Unilever Director fails to attend in accordance with the Bylaws at least 50% of all regular meetings of the Board during any 12-month period without good cause.

“ Refinancing ” means any financing, refinancing, restructuring, recapitalization or similar transaction which is undertaken for the purpose or with the effect of generating cash proceeds sufficient to enable the Company to pay (a) all, or any portion in excess of 50% of, the Put Price for the Put Securities in connection with the exercise of the Put Option, or (b) all of the Put Price for the Call Shares subject to the exercise of the Call Option; provided , however , that no Refinancing need be undertaken or consummated by the Company prior to the Eighth Year (x) if, after giving effect to such Refinancing, the Company’s Indebtedness to EBITDA Ratio would exceed 4.6, or (y) if the Net Proceeds would be insufficient to pay at least 50% of the Put Price for the Put Securities; provided , however , that, notwithstanding anything to the contrary contained in this definition or any other provision of this Agreement, so long as any obligation, amount or commitment is outstanding under any Credit Document, any such financing, refinancing, restructuring, recapitalization, or similar transaction shall only constitute a “Refinancing” for the purposes of the condition set forth in Section 8.4(a) if, as a result thereof, all obligations and amounts owing under such Credit Documents shall have been paid in full in cash and the obligations and commitments of the lenders (and their affiliates) thereunder shall have been terminated.

“ Refinancing Period ” has the meaning set forth in Section 8.4.

“ Related Person ” means the Company or any of its Affiliates, any Unilever Group Member or any Holdco Group Member.

“ Relevant Transferee ” has the meaning set forth in Section 7.3.

“ Remaining Unilever Shares ” has the meaning set forth in Section 8.2.

“ Remaining Put Securities ” has the meaning set forth in Section 8.4.

 

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“ Repurchase Expenses ” means all out-of-pocket expenses and fees incurred, accrued or payable by any Company Group Member or on its behalf in connection with the exercise of the Put Option or the Call Option or an Approved Sale (including, without limitation, (a) fees and expenses of banks, investment banking firms, other financial institutions and their agents and counsel in connection with (i) the arranging, committing to provide or providing of any financing, or (ii) the structuring, negotiation or consummation of a Refinancing, any action in connection with a Partial Repurchase, an Eighth Year Action, an Approved Sale or any agreements relating thereto; (b) fees of counsel, accountants, experts and consultants to the Company; and (c) all printing and advertising expenses); provided , however , that the aggregate amount of Repurchase Expenses subtracted from the Base Value pursuant to clause (a)(iii) of the definition of “Fair Market Value” herein and from the Share Price pursuant to Section 8.2(b), without duplication, shall not exceed the sum of (x) $45 million, plus (y) the aggregate amount of the costs described in Section 8.11(e).

“ Requisite Vote ” means the affirmative vote of holders of Shares representing in the aggregate more than 90% of the outstanding Shares.

“ Revolving Credit Limits ” has the meaning set forth in Section 4.10.

“ ROFR Notice ” has the meaning set forth in Section 7.3.

“ ROFR Price ” has the meaning set forth in Section 7.3.

“ SCJ Competitor ” has the meaning set forth in Section 7.3.

“ Secondary Structures ” has the meaning set forth in Section 7.9.

“ Securities Act ” means the Securities Act of 1933, as amended.

“ Senior Credit Debt ” means the loans and all other amounts, obligations, covenants and duties owing to the administrative agent, the collateral agent or any lender party to the Credit Agreement, any affiliate of any of them, or any indemnitee under any Credit Document, of every type and description (whether by reason of an extension of credit, opening or amendment of a letter of credit or payment of any draft drawn thereunder, loan, guaranty, indemnification, foreign exchange or currency swap transaction, interest rate hedging transaction or otherwise), present or future, arising under the Credit Agreement or any other Credit Document, any hedging agreement, foreign exchange or currency swap agreement, any agreement for cash management services entered into in connection with the Credit Agreement or any other Credit Document, whether direct or indirect (including those acquired by assignment), absolute or contingent, due to or become due, now existing or hereafter arising and however acquired and whether or not evidenced by any note, guaranty or other instrument or for the payment of money, and includes all letter of credit, cash management and other fees, interest (including interest which, but for the filing of a petition in bankruptcy with respect to any borrower under the Credit Agreement, would have accrued on any obligation constituting Senior Debt hereunder, whether or not a claim is allowed against such borrower for such interest in the related bankruptcy proceeding), charges, expenses, fees, attorneys’ fees and disbursements and other sums chargeable to any borrower under the Credit Agreement, any other Credit Document, any hedging agreement, foreign exchange or currency swap agreement, any agreement for cash

 

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management services entered into in connection with the Credit Agreement or any other Credit Document. To the extent any payment of Senior Debt (whether by or on behalf of the borrowers under the Credit Agreement, as proceeds of security or enforcement or any right of setoff or otherwise) is declared to be fraudulent or preferential, set aside or required to be paid to a trustee, receiver or other similar party under any bankruptcy, insolvency, receivership or similar law, then if such payment is recovered by, or paid over to, such trustee, receiver or other similar party, the Senior Debt or part thereof originally intended to be satisfied shall be deemed to be reinstated and outstanding as if such payment had not occurred.

“ Senior Debt ” means (a) the Senior Credit Debt, and (b) all other Indebtedness under the Financing Agreements or, to the extent the Financing Agreements (including any Senior Credit Debt) have been amended, restated, supplemented or replaced in connection with a Refinancing, Indebtedness under such amended, restated, supplemented or replacement agreements or arrangements.

“ Seventh Year ” means the seventh anniversary of the Closing Date.

“ Share Price ” has the meaning set forth in Section 8.2.

“ Shared Pension Plans ” means the following employee benefit plans: (a) Johnson Wax Limited/S.C. Johnson Professional Limited Retirement and Life Assurance Plan, consisting of the Money Purchase Section and the Final Salary Section, with the Final Salary Section replacing SERPS (also referred to as Johnson Wax Retirement and Life Assurance Plan) (U.K.), (b) Pension Plan for Employees of S.C. Johnson and Son, Limited, as amended and restated effective July 1, 1992, including amendments effective January 1, 1996, updated February 29, 1996 to incorporate changes requested by Revenue Canada to the 1992 Income Tax Act (Canada), and (c) S.C. Johnson Pension Fund (Netherlands).

“ Shares ” means the Class A Shares and the Class B Shares.

“ Special Bankruptcy Committee ” means a committee (a) comprising all the Independent Directors and no other Directors, and (b) constituted for the purpose of acting, and having the authority of the Board to the extent permitted by the DGCL, with respect to the matters described in Section 4.14.

“ Special Committee ” has the meaning set forth in Section 8.13.

“ Special Items ” has the meaning set forth in Exhibit 4 .

“ Stockholders ” has the meaning set forth in the introductory paragraph to this Agreement.

“ Stockholders’ Meeting ” means (a) any annual or special meeting of the Stockholders or (b) any action by written consent of the Stockholders.

“ Strategic Plan ” has the meaning set forth in Section 4.12.

 

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“ Subject Securities ” means the Put Securities, Partially Put Securities or Call Securities, as the case may be.

“ Subsidiary ” means, with respect to any Person, any Entity of which (a) if a corporation, a majority of the total voting power of shares of stock entitled (without regard to the occurrence of any contingency) to vote in the election of directors, managers or trustees thereof is at the time owned or controlled, directly or indirectly, by that Person or one or more of the other Subsidiaries of that Person or a combination thereof, or (b) if a limited liability company, partnership, association or other business entity, a majority of the partnership or other similar ownership interest thereof is at the time owned or controlled, directly or indirectly, by that Person or one or more Subsidiaries of that Person or a combination thereof. For purposes of this definition, a Person or Persons shall be deemed to have a majority ownership interest in an Entity other than a corporation if such Person or Persons shall be allocated a majority of such Entity’s gains or losses or shall be or control any managing member or general partner of such Entity.

“ Supermajority Approval ” has the meaning set forth in Section 4.10.

“ Total Voting Power ” means, at any time, the aggregate number of votes which may be cast by holders of outstanding common stock and any other securities issued by an Entity that are entitled to vote generally for the election of directors of such Entity (other than securities having such powers only upon the occurrence of a contingency unless that contingency is satisfied at that time).

“ Transaction Documents ” means this Agreement, the Purchase Agreement, all agreements the forms of which, or terms sheets for which, are attached as exhibits or schedules hereto or thereto and all other documents, instruments and agreements executed in connection with the Purchase Agreement or the transactions contemplated thereby.

“ Transfer ” means any sale, transfer, assignment, pledge, mortgage, exchange, hypothecation, grant of a security interest or other direct or indirect disposition or encumbrance of an interest (including, without limitation, by operation of law) or the acts thereof. The terms “ Transferee ,” “ Transferor ,” “ Transferred ,” and other forms of the word “ Transfer ” shall have correlative meanings.

“ Unilever ” means Unilever NV and/or Unilever PLC.

“ Unilever Director ” means a Director nominated by the Unilever Stockholder pursuant to Section 4.3(a)(i).

“ Unilever Group ” means Unilever NV, Unilever PLC and their respective Affiliates from time to time.

“ Unilever Group Member ” means any member of the Unilever Group.

“ Unilever NV ” has the meaning set forth in the introductory paragraph to this Agreement.

 

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“ Unilever PLC ” means Unilever PLC, a company organized under the laws of England and Wales.

“ Unilever Required Control ” means, with respect to a Person, (a) (i) if a corporation, the aggregate beneficial ownership by Unilever of securities representing at least 80% of the Total Voting Power in such Person and (ii) if an Entity other than a corporation, the aggregate beneficial ownership by Unilever of at least 80% of the partnership or other similar voting interest, and (b) the right to elect a majority of such Person’s board of directors or comparable governing body.

“ Unilever Sale ” has the meaning set forth in Section 8.13.

“ Unilever Shares ” means the Class B Shares originally issued to or hereafter acquired by any Unilever Group Member.

“ Unilever Stockholder ” means, collectively, the Unilever Group Members who from time to time hold Class B Shares.

“ Unilever Valuation Report ” has the meaning set forth in Section 8.9.

“ Valuation Principles ” means objective, generally accepted financial and valuation procedures utilized in determining the enterprise value of companies and businesses similarly situated to the Company Group, taking into account the following factors:

(a) The businesses of the Company Group (in each case taking into account any long term and contingent liabilities) shall be valued (i) as if 100% of such businesses were being sold as of the last day of the applicable Measurement Period without, for the avoidance of doubt, any premium or discount being applied to reflect the Ownership Interests being sold or transferred, (ii) on the basis of an open market sale occurring on the last day of the applicable Measurement Period between a willing seller and a willing, knowledgeable and arm’s length buyer of such businesses as a whole receiving warranties and indemnities equivalent to those set forth in the Purchase Agreement, (iii) assuming that the Company Group has working capital equal to the Company Group’s average working capital during the applicable Measurement Period which formed the basis of the Applicable EBITDA and the Base Value computations, measured on a consistent basis, and (iv) assuming that the Company Group has no Indebtedness or Cash.

(b) Appropriate adjustment shall be made to take into account the impact on valuation of the difference between Non-Arm’s Length Terms and arm’s length terms and, where EBITDA is the basis for the enterprise value, only to the extent such impact has not already been taken into account as an adjustment to Applicable EBITDA.

“ Value ” means (a) the price per share obtained by the Unilever Stockholder in the sale of all of its Class B Shares on a Final Exit Date, or (b) if no such sale has occurred as of the Additional Shares Exercise Date, the Share Price per share as of such date, as calculated in accordance with the provisions of this Agreement.

 

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“ Veto Matter ” has the meaning set forth in Section 4.10.

“ Whitmire ” means Whitmire Micro-Gen Research Laboratories, a Delaware corporation and a wholly-owned subsidiary of CMI, together with its Subsidiaries.

“ Wholly-Owned Subsidiary ” means, with respect to any Person, a Subsidiary of which 100% of the outstanding equity securities or partnership or other similar ownership interests (other than director-qualifying shares or interests, shares or interests held by trustees and nominal share interests held by individuals or other entities, including, for the avoidance of doubt, the one share of CMI held by S.C. Johnson & Son, Inc.) thereof is at the time owned by that Person or one or more Wholly-Owned Subsidiaries of that Person or a combination thereof.

1.2 Construction . As used in this Agreement, the words “herein,” “hereof,” “hereunder” and other words of similar import refer to this Agreement as a whole and not to any particular paragraph, subparagraph, Section, subsection, Article or other subdivision, and, unless the context otherwise requires, all references to parties, Sections, Articles, Exhibits or Schedules are to parties to this Agreement and Sections and Articles of and Exhibits and Schedules to this Agreement. The table of contents and section headings of this Agreement and titles given to Exhibits and Schedules to this Agreement are for reference purposes only and are to be given no effect in the construction or interpretation of this Agreement. Whenever the context may require, any pronoun used in this Agreement will include the corresponding masculine, feminine or neuter forms, the singular form of nouns, pronouns and verbs will include the plural and vice versa and, except as otherwise expressly provided in this Agreement, each term used herein which is defined in GAAP is used herein as so defined. Any rule of construction to the effect that any ambiguities are to be resolved against the drafting party will not be employed in the interpretation or construction of this Agreement.

1.3 Currency . References to “$” are to United States dollars. All financial amounts and calculations thereof referred to in this Agreement, and all payments pursuant to this Agreement, shall be in United States dollars.

ARTICLE II

ORGANIZATION

2.1 Certificate of Incorporation and Bylaws . As of the date of effectiveness of this Agreement, the Certificate of Incorporation of the Company (the “ Certificate ”) and the Bylaws of the Company (the “ Bylaws ”) shall be in the forms attached hereto as Exhibits 5 and 6 , respectively. The rights and obligations of the Stockholders with respect to the Company shall be determined pursuant to the DGCL, the Certificate, the Bylaws and this Agreement. To the extent that the rights or obligations of a Stockholder are different by reason of any provision of this Agreement than they would be in the absence of such provision, this Agreement, to the extent permitted by the DGCL and the Certificate, shall control.

2.2 Headquarters . The worldwide corporate headquarters and principal office of the Company shall be at such place as the Board may designate from time to time. From and after the Closing Date, until changed by action of the Board, the worldwide corporate

 

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headquarters and principal office of the Company will be located at the Company’s current headquarters in Sturtevant, Wisconsin, U.S.A.

ARTICLE III

STOCKHOLDERS

3.1 Stockholders . The name and business, mailing or residence address of each Stockholder of the Company and the number and class of Shares held by such Stockholder are set forth on Schedule A . Henceforth, the Board shall cause Schedule A to be amended from time to time to reflect the addition or retirement of Stockholders, or the issuance, purchase or Transfer of Shares, in each case in accordance with the terms of this Agreement.

3.2 Purchase of Shares . On the Closing Date, Marga paid the Subscription Payment, in an amount set forth on Schedule A , in consideration for the issue of the Unilever Shares.

ARTICLE IV

MANAGEMENT OF THE COMPANY

4.1 The Board .

(a) The business and affairs of the Company will be managed by or under the direction of the Board, and the Board shall have all powers, subject to subsection (c) of this Section 4.1, and rights necessary, appropriate or advisable to effectuate and carry out the purposes and business of the Company. No Stockholder, by reason of its status as such, shall have any authority to act for or bind the Company or otherwise take part in the management of the Company.

(b) Without limiting the generality of subsection (a) of this Section 4.1, but subject to Section II.A.2.b of Article Fourth of the Certificate, subsection (c) of this Section 4.1 and Sections 4.5 and 4.10, the Board, and the committees thereof constituted in accordance with Article IV of the Bylaws and Section 4.5, will be responsible for directing the oversight of the management of the Company, including, without limitation, the following matters:

(i) Hiring the Chief Executive Officer, Chief Financial Officer and the chief operating and administrative officers of the Company, evaluating their performance and planning for their succession;

(ii) Establishing compensation and benefits policies and plans for employees of the Company, including profit sharing;

(iii) Reviewing and approving Company strategies, the Business Plans and the Strategic Plan;

 

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(iv) Reviewing and approving significant external business opportunities for the Company, including, without limitation, acquisitions, mergers and divestitures;

(v) Reviewing external and internal audits and management responses thereto;

(vi) Approving dividends and distributions to Stockholders;

(vii) Reviewing and approving policies of the Company in the areas of environmental responsibility, employee safety and health and community, government, employee and customer relations; and

(viii) Reviewing and approving any individual capital expenditure in excess of $5 million.

(c) Any action of the Board with respect to a Veto Matter shall be subject to the requirements of Section II.A.2.b of Article Fourth of the Certificate and Section 4.10 with respect to obtaining Stockholder approval in accordance therewith, and no such Veto Matter shall become effective until such approval, if required, has been obtained.

4.2 Size of the Board; Term . The Company shall take such actions as are necessary, and each of the Stockholders shall vote its Shares and shall take such other actions as are necessary, to cause the Board at all times from and after the Closing Date, subject to Sections 4.3(a)(iii) and 4.4(a)(ii), to consist of eleven Directors in accordance with the Bylaws. The Board shall not be classified and shall be elected annually. Each Director shall hold office until a successor is duly elected and qualified or until his or her earlier death, resignation or removal in accordance with the Bylaws and this Agreement.

4.3 Nomination of Directors .

(a) The Company shall take such actions as may be lawful and necessary, and each of the Stockholders (subject to subsection (c) of this Section 4.3) shall vote its Shares and shall take such other actions as may be necessary, to cause the Board, at all times from and after the Closing Date, to include the following Directors nominated and elected as follows:

(i) Unilever Directors . If and so long as Unilever has Unilever Required Control of the Unilever Stockholder:

(A) If and so long as the Unilever Stockholder has the Full Representation Holding, the Unilever Stockholder shall be entitled to nominate as Unilever Directors two Qualified Candidates of any Unilever Group Member to the Board; and

(B) If the Unilever Stockholder does not have the Full Representation Holding but continues to have the Minimum Representation Holding, the Unilever Stockholder shall be entitled to nominate as a Unilever Director one Qualified Candidate of any Unilever Group Member to the Board.

 

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If the Unilever Stockholder ceases to maintain the Full Representation Holding or Minimum Representation Holding, as the case may be, the vacancy resulting from such event shall be filled by an individual nominated by the Holdco Stockholder, in each case, as more fully set forth in Section 4.4(a).

(ii) Holdco Directors . Except as otherwise provided in Section 4.4(a), the Holdco Stockholder shall be entitled to nominate four individuals to the Board.

(iii) Independent Directors . The Holdco Stockholder shall be entitled to nominate five additional individuals to the Board, each of whom shall satisfy the requirements to be an Independent Director; provided , that as of the date hereof, the Incumbent Independent Directors shall continue to serve on the Board pursuant to this subsection (iii).

(b) The Unilever Stockholder shall, prior to the nomination of any Unilever Director (including the nomination of any Director chosen to fill a vacancy pursuant to Section 4.4(b)(i)), give the Holdco Stockholder a reasonable opportunity to raise any objections as to his or her suitability, and the Holdco Stockholder shall, prior to the nomination of any Holdco Director (including the nomination of any Director chosen to fill a vacancy pursuant to Section 4.4(a)(i), (a)(ii) or (b)(ii)), give the Unilever Stockholder a reasonable opportunity to raise any objections as to his or her suitability. The Holdco Stockholder shall, prior to the nomination of any Independent Director (other than Incumbent Independent Directors but including the nomination of any Independent Director chosen to fill a vacancy pursuant to Section 4.4(a)(i), (a)(ii), (a)(iii) or (b)(iii)), deliver to the Unilever Stockholder a copy of an Independence Questionnaire for such Independent Director demonstrating such Independent Director’s compliance with the criteria set forth in the definition of “Independent Director” herein and give the Unilever Stockholder a reasonable opportunity to raise any objections as to his or her suitability and, upon reasonable notice and during normal business hours, to interview such Independent Director at a mutually convenient location. The Holdco Stockholder shall also deliver to the Unilever Stockholder no later than one week prior to the Election Meeting at which Independent Directors (other than Incumbent Independent Directors) shall be elected or re-elected (as the case may be) or at the Unilever Stockholder’s reasonable request, but not more frequently than once every Fiscal Year in respect of any particular Independent Director, copies of Independence Questionnaires for such Independent Directors.

(c) Notwithstanding the foregoing, nothing in this Agreement shall require the Unilever Stockholder to vote the Unilever Shares or act by written consent to elect any Holdco Director or Independent Director nominated by the Holdco Stockholder pursuant to this Section 4.3 or Section 4.4.

(d) The Unilever Stockholder shall provide, at the Company’s reasonable request, any information about a Unilever Director or any member of the Unilever Group as may be required to enable the Company or its Affiliates to comply with the Exchange Act, the Securities Act and the rules and regulations thereunder.

(e) Notwithstanding the foregoing, the Unilever Stockholder’s right to continued Board representation pursuant to this Agreement shall be subject to compliance with Section 8 of the Clayton Act relating to interlocking directorates.

 

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4.4 Vacancies; Removal .

(a) (i) If the Unilever Stockholder ceases to have the Full Representation Holding but continues to have the Minimum Representation Holding, then one of the Unilever Directors (as designated by the Unilever Stockholder in its sole discretion, or, in the absence of such designation, designated by the Holdco Stockholder) shall be deemed to have resigned effective immediately upon the occurrence of such event, and the Unilever Stockholder, the Holdco Stockholder and the Company shall take all actions necessary to give effect to such resignation. Any vacancy resulting from any such resignation described in this subsection (i) shall be filled with either an Holdco Director or an Independent Director nominated by the Holdco Stockholder.

(ii) If the Unilever Stockholder ceases to have the Minimum Representation Holding, then any and all Unilever Directors then remaining as Directors shall be deemed to have resigned effective immediately upon the occurrence of such event, and the Unilever Stockholder, the Holdco Stockholder and the Company shall take all actions necessary to give effect to such resignation. If following such resignation, the Unilever Stockholder continues to own Unilever Shares, any vacancy resulting from any such resignation described in this subsection (ii) shall be filled with an Independent Director nominated by the Holdco Stockholder to the extent necessary to maintain a majority of Independent Directors on the Board but otherwise (x) such vacancy may be filled with a Holdco Director nominated by the Holdco Stockholder or (y) the number of Directors may be reduced to eliminate such vacancy.

(iii) If an Independent Director (other than an Incumbent Independent Director) ceases to qualify as an Independent Director hereunder, as determined by reference to such Independent Director’s Independence Questionnaire, such Independent Director shall not be nominated for reelection at the Election Meeting following receipt by the Company of such Independence Questionnaire and the resulting vacancy shall be filled with an Independent Director nominated by the Holdco Stockholder.

(b) If a vacancy on the Board occurs as a result of a death, disability, resignation, removal or otherwise of a Director (other than the resignation of a Unilever Director pursuant to subsection (a)(i) or (ii) of this Section 4.4 but including any replacement pursuant to subsection (a)(iii) of this Section 4.4), such vacancy shall be filled as follows, and the provisions of Section 4.3, as relevant (including with respect to the raising of objections but excluding any shareholder vote), shall apply to the filling of such vacancy:

(i) If such vacancy results from the death, disability, resignation, removal or otherwise of a Unilever Director, such vacancy shall be filled by the Unilever Stockholder.

(ii) If such vacancy results from the death, disability, resignation, removal or otherwise (including pursuant to Section 4.3(a)(iii)) of a Holdco Director, such vacancy shall be filled by the Holdco Stockholder.

 

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(iii) If such vacancy results from the death, disability, resignation, removal or otherwise of an Independent Director, such vacancy shall be filled with another Independent Director nominated by the Holdco Stockholder.

(c) (i) Subject to subsection (ii) of this Section 4.4(c), the Directors elected under Section 4.3(a) shall hold office until the next election of Directors and until their successors shall have been elected and qualified.

(ii) Each Director (including an Independent Director) may be removed and replaced, with or without cause, at any time by the Stockholder that nominated him or her, but, except as provided in this Section 4.4, may not be removed or replaced by any other means. The Holdco Stockholder shall notify the Unilever Stockholder of, and consult with the Unilever Stockholder with respect to, its intent to remove or replace any Independent Director prior to such removal or replacement, but such removal or replacement shall be at Holdco’s sole discretion. A Stockholder who removes one or more of its Directors from the Board or whose nominee otherwise is no longer a Director will promptly notify the other Stockholders as to the name of its replacement Director. Any Stockholder who removes a Director from office, or whose nominee vacates office under this Section 4.4, shall, jointly and severally, with any other Stockholder voting for such removal, indemnify each other Stockholder and the Company against any claim, whether for compensation for loss of office, wrongful dismissal or otherwise, which arises out of that Director ceasing to hold office.

4.5 Committees .

(a) Subject to the exercise by the Board of its fiduciary duties, the Company and each of the Stockholders shall take such actions as are necessary to cause the following committees of the Board to be constituted in accordance with Article IV of the Bylaws:

(i) An Audit Committee constituted solely of Independent Directors, which shall operate in accordance with the Audit Committee Charter. The Unilever Stockholder may appoint one of the Unilever Directors as an observer to attend, but not vote at, meetings of the Audit Committee. Such observer shall be provided the same rights with respect to the receipt of materials, advance notification of meetings and participation in meetings as are afforded to members of the Audit Committee.

(ii) A Compensation Committee, which shall operate in accordance with the Compensation Committee Charter. The Compensation Committee shall include one of the Unilever Directors, but shall otherwise be constituted solely of Independent Directors.

(b) All other committees of the Board (other than (i) committees constituted (A) for the purpose of assessing or determining any matter in which any Unilever Group Member or Unilever Director has any interest materially adverse to any interest of any Company Group Member, including, without limitation, the rights of the Unilever Stockholder under this Agreement, the Purchase Agreement or any Ancillary Document, (B) solely of Independent Directors in order to comply with, or to be afforded protections under Delaware law, including the DGCL (including, without limitation, Sections 144 and 145 of the DGCL), or (C) pursuant to

 

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Section 8.13(e), or (ii) any Special Bankruptcy Committee) shall include one of the Unilever Directors as a member.

4.6 Election Meetings . Subject to Section 4.3(c), at each and every Election Meeting held after the Closing Date, each Stockholder hereby agrees to vote or act by written consent with respect to (or cause to be voted or acted upon by written consent) (i) all Shares held of record or beneficially owned by such Stockholder at the time of such vote or action by written consent and (ii) all Shares as to which such Stockholder at the time of such vote or action by written consent has voting control, in each case in favor of the election of the Directors nominated in accordance with Section 4.3 to serve on the Board.

4.7 Chairman of the Board . The Holdco Stockholder shall be entitled to appoint one of the Holdco Directors to act as the Chairman, who shall preside at any Stockholders’ Meeting at which he or she is present.

4.8 Board Meetings .

(a) Except as otherwise set forth in the Bylaws, all actions of the Board will be taken at meetings of the Board in accordance with this Section 4.8.

(b) As soon as practicable after the election of Directors as provided in Section 4.3, the Board will meet for the purpose of organization and the transaction of other business as provided in the Bylaws.

(c) Regular meetings of the Board will be held at such times as are provided in the Bylaws, but no less frequently than once each Fiscal Quarter.

(d) Special meetings of the Board will be held whenever called by the Chairman, the Chief Executive Officer or any Stockholder that is entitled to nominate at least one Director. Any and all business may be transacted at a special meeting that may be transacted at a regular meeting of the Board.

(e) The Board may hold its meetings at such place or places as the Board may from time to time by resolution determine or as may be designated in the respective notices or waivers of notice thereof. The Company will use reasonable efforts to schedule the time and place of each meeting of the Board so as to ensure that a quorum and at least one Director nominated by each Stockholder will be present at each such meeting. Members of the Board or any committee thereof may participate in and act at any meeting of the Board or such committee through video conference or the use of a conference telephone or other communications equipment, in each case by means of which all persons participating in the meeting can hear each other, and participation in the meeting by such means shall constitute presence in person at the meeting.

(f) Notices of regular meetings of the Board or of any adjourned regular meeting will be given at least four weeks prior to such meeting, unless otherwise agreed in writing by each Stockholder. Notices of special meetings of the Board or of any adjourned special meeting will be faxed by the Secretary or an Assistant Secretary to each Director addressed to him or her at his or her residence or usual place of business, so as to be received at

 

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least five Business Days (excluding days on which the principal office of the Company is not open for business) before the day on which such meeting is to be held. Such notice will include the purpose, time and place of such meeting and will set forth in reasonable detail the matters to be considered at such meeting. However, notice of any such meeting need not be given to any Director if such notice is waived by him or her in writing, whether before or after such meeting is held, or if he or she is present at such meeting (unless such Director objects, before any business is conducted thereat, to the holding of such meeting without due notice), or with respect to regular meetings scheduled at a meeting of the Board held at least 30 calendar days prior to the date of a subsequent meeting.

(g) Meetings of the Board will be presided over by the Chairman or, if the Chairman is not present, a Director designated by the Chairman. The Secretary of the Company or, in the case of his or her absence, any Person whom the Person presiding over the meeting may appoint, will act as secretary of such meeting and keep the minutes thereof.

4.9 Compensation . Unless the Stockholders otherwise agree in writing, no Director will be entitled to any compensation from the Company in connection with his or her services as a Director, except that Independent Directors will be entitled to compensation for their service as such, the amount and nature of which will be determined from time to time by the Board.

4.10 Veto Matters .

(a) Subject to subsections (b) and (c) of this Section 4.10, each of the following matters, and only the following matters, will constitute a “ Veto Matter ,” and the Company shall not, and, to the extent restrictions apply, the Company shall cause its Subsidiaries to not, without the prior approval of the Stockholders by the Requisite Vote taken in accordance with Section II.A.2.b of Article Fourth of the Certificate (the “ Supermajority Approval ”), take any of the following actions:

(i) The entering into by the Company of any transaction or transactions of a type specified in this Section 4.10(a)(i) or the entering into by any Subsidiary of the Company of any transaction or transactions of a type specified in this Section 4.10(a)(i) (other than, in any such case, any such transaction between or among any Wholly-Owned Subsidiary of the Company, on the one hand, and the Company or any other Wholly-Owned Subsidiary of the Company, on the other hand):

(A) except as otherwise provided in Section 7.2 or subsection (c)(i) of this Section 4.10, any acquisition or disposition (whether by way of distribution, sale, merger, consolidation, combination, lease, assignment, license, transfer or other disposition) of any Entity, property or assets (including intellectual property), any joint venture, alliance or capital project, in any such case involving the Company or any of its Subsidiaries and having an aggregate fair market value or which pursuant to the terms thereof will result in aggregate expenditures or payments in excess of (1) $50 million individually, or (2) $10 million individually and $100 million collectively with other such transactions entered into in the immediately preceding twelve months, other than any of the foregoing relating to feeders

 

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or dosing equipment provided to customers (including such equipment so provided on a leased or free on loan basis) or acquired in the Ordinary Course of Business;

(B) the issuance of any additional shares of capital stock, including Shares and Common Stock Equivalents, or other equity or equity-related interests (other than performance-based cash compensation of employees under employee benefit plans), including any of the foregoing held in treasury, to any Person (including any Stockholder or pursuant to a Public Offering) after the date hereof, other than the issuance of any of the foregoing by any Subsidiary of the Company to either the Company or any other Subsidiary of the Company;

(C) except as otherwise provided in Section 7.2 or subsection (c)(i) of this Section 4.10, any merger, consolidation or similar business combination or any sale of all or substantially all of the assets or equity or any reorganization or recapitalization having similar effect, in each case, of the Company or any Subsidiary of the Company;

(D) the liquidation or dissolution of the Company or any Subsidiary (other than a Wholly-Owned Subsidiary) of the Company; and

(E) the purchase or investment by the Company or any Subsidiary of the Company of a minority equity investment or investment in the nature of Indebtedness in any Entity if such purchase or investment has a fair market value or pursuant to the terms thereof will result in payments exceeding $10 million;

(ii) The entering into by the Company or any Subsidiary of the Company of any material line of business unrelated to the Business;

(iii) The closing, winding-up, discontinuation or other exiting or termination (other than by way of any disposition of the type described in subsection (i)(A) of this Section 4.10(a)) by the Company or any of its Subsidiaries of any line of business that the Company or any of its Subsidiaries is engaged in as of the date hereof, if such line of business generated more than $5 million of EBITDA during the four full Fiscal Quarters immediately preceding the date on which the Supermajority Approval is sought with respect to such closing, winding-up, discontinuation or other exiting or termination and such closing, winding-up, discontinuation or other exiting or termination is commenced after such Supermajority Approval has been obtained;

(iv) The amendment, supplement or other modification of the principles or policies governing the amount, timing, frequency or method of calculation of dividends or distributions to the Stockholders from that described on Exhibit 7 (the “ Agreed Dividend Policy ”) or the declaration by the Company of dividends or distributions in violation of the Agreed Dividend Policy, other than pro rata dividends or distributions to holders of Common Stock as may be required, and which are used, to enable the Holdco Stockholder to effect repurchases from employees of the Company and its Subsidiaries, pursuant to the Management Plan Documents, of shares of Holdco’s capital stock issued pursuant to grants approved by the Compensation Committee of the Board;

 

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(v) The Incurrence by the Company or any of its Subsidiaries after the date hereof of Indebtedness, other than (A) Indebtedness in the nature of revolving credit or working capital Indebtedness up to the aggregate princi