- 5 - that the business and affairs of the corporation shall be conducted subject to the terms and conditions hereof.” Among the actions that can be taken only by unanimous vote of the Board of Directors are: “(i) obligating the Corporation to participate in any exhibition or exposition; * * * [and] (v) entering into any extraordinary agreement or incurring any extraordinary expense not in the usual and regular course of business * * *”. Article 10 of the stockholders’ agreement, entitled “Agreement Regarding Revenues”, provides “that the ‘net profits’ (as defined herein)4 to the Corporation from its exhibition and exposition operations shall be allocated to the Stockholders” under three different scenarios, depending on where “the exhibition or exposition takes place”. Kogan’s percentage of net profits under the three scenarios is always less than 20 percent of net profits and equal to one-half of Pollak’s and Tseytin’s percentages, which are always equal to each other. Under the three scenarios, Agalarov’s percentages of net profits vary to include 50 percent of net profits for trade shows in the former Soviet Union, 10 percent of net profits for trade shows in Romania, and 20 percent of net profits for trade shows in the United States. The stockholders’ agreement does not refer to or 4The last sentence of Article 10 of the stockholders’ agreement provides: “For purposes hereof, the term net profits means the gross revenues from the operations of the Corporation less all cost and expenses and taxes.”Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Next
Last modified: May 25, 2011