Investor Rights Agreement

EXHIBIT 10.11


INVESTOR RIGHTS AGREEMENT dated as of the Original Issue Date (this "Agreement") among SALT HOLDINGS CORPORATION, a Delaware corporation (the --------- "Company") and the HOLDERS that are parties hereto. -------


WHEREAS, each Holder deems it to be in the best interest of the Company and the Holders that provision be made for the continuity and stability of the business and policies of the Company, and, to that end, the Company and the Holders hereby set forth herein their agreement with respect to the Common Stock, Preferred Stock and Options owned by them.


NOW, THEREFORE, in consideration of the premises and of the mutual consents and obligations hereinafter set forth, the parties hereto hereby agree as follows:


Section 1. Definitions.
-----------


As used in this Agreement:


"Affiliate" of the Company or YBR means a Person that directly, or
--------- indirectly through one or more intermediaries, controls, or is controlled by, or is under common control with, the Company or YBR, as applicable. As used in this definition, the term "control," including the correlative terms "controlling," "controlled by" and "under common control with," means possession, directly or indirectly, of the power to direct or cause the direction of management or policies (whether through ownership of securities or any partnership or other ownership interest, by contract or otherwise) of a Person. The term "Affiliate" shall not include at any time any portfolio companies of Apollo Management V, L.P. or its Affiliates.


"Affiliate" of a Holder (other than YBR) means: (i) any member of the
--------- immediate family of an individual Holder, including parents, siblings, spouse and children (including those by adoption); the parents, siblings, spouse, or children (including those by adoption) of such immediate family member, and in any such case any trust whose primary beneficiary is such individual Holder or one or more members of such immediate family and/or such Holder's lineal descendants; (ii) the legal representative or guardian of such individual Holder or of any such immediate family members in the event such individual Holder or any such immediate family members becomes mentally incompetent; and (iii) any Person controlling, controlled by or under common control with a Holder. As used in this definition, the term "control," including the correlative terms "controlling," "controlled by" and "under common control with," means possession, directly or indirectly, of the power to direct or cause the direction of management or policies (whether through ownership of securities or any partnership or other ownership interest, by contract or otherwise) of a Person. The term "Affiliate" shall not include at any time any portfolio companies of Apollo Management V, L.P or its Affiliates.


"Apollo Group" means Apollo Investment Fund V, L.P., a Delaware
------------ limited partnership, Apollo Overseas Partner V, L.P. and each of their respective Affiliates.


"Asset Sale" means the sale of all or substantially all of the assets
---------- of the Company to a Person or Group which is not an Affiliate of YBR.


"Board" means the Board of Directors of the Company and any duty
----- authorized committee thereof. All determinations by the Board required pursuant to the terms of this Agreement to be made by the Board shall be binding and conclusive.


"Cause" means a Non-YBR Holder's (a) conviction of a felony or crime
----- of moral turpitude (other than a traffic violation), (b) willful commission of any action that is materially harmful to the Company or its Affiliates on a consolidated basis (other than any action taken in good faith utilizing such Non-YBR Holder's business judgement), or (c) failure to follow any lawful communicated directive of the Board delivered to the Non-YBR Holder.


"Come Along Option" has the meaning ascribed to such term in Section
----------------- 4.2(b).


"Common Stock" means: (a) all shares of the voting or non-voting
------------ common stock of the Company owned by each of the Holders on the date hereof; (b) all shares of the voting or non-voting common stock hereafter issued by the Company to or acquired by any Holder, whether in connection with a purchase, issuance, grant, stock split, stock dividend, reorganization, warrant, option, convertible security, right to acquire, deferred compensation plan or otherwise; and (c) all securities of the Company or any other Person which any Holder acquires in respect of his, her or its shares of Common Stock in connection with any exchange, merger, recapitalization, consolidation, reorganization or other transaction to which the Company is a party. All references herein to Common Stock owned by a Holder include the community interest or similar marital property interest, if any, of the spouse of such Holder in such Common Stock. The term "common stock" means any stock of any class of the Company which has no preference in respect of dividends or of amounts payable in the event of any voluntary or involuntary liquidation, dissolution or winding up of the Company and which is not subject to redemption by the Company (whether or not shares of such class have voting rights).


"Control Disposition" means a Disposition which would have the effect
------------------- of transferring to a Person or Group that is not an Affiliate of YBR a number of shares of Common Stock such that, following the consummation of such Disposition, such Person or Group possesses the voting power to elect a majority of the Board (whether by merger, consolidation or sale or transfer of Common Stock).


"Disposition" means any direct or indirect transfer, assignment, sale,
----------- gift, pledge, hypothecation or other encumbrance, or any other disposition, of Common Stock or Preferred Stock (or any interest therein or right thereto) or of all or part of the voting power (other than the granting of a revocable proxy) associated with the Common Stock or Preferred Stock (or any interest therein) whatsoever, or any other transfer of beneficial ownership of Common Stock or Preferred Stock whether voluntary or involuntary, including, without limitation (a) as a part of any liquidation of a Non-YBR Holder's assets or (b) as a part of any reorganization of a Non-YBR Holder pursuant to the United States or other bankruptcy law or other similar debtor relief laws; provided, that (i) without
-------- limiting restrictions contained in this Agreement, pledge arrangements which may be entered into by a Non-YBR Holder pledging his, her or its Common Stock or Preferred Stock to banks or other bona fide sources of financing and any transactions contemplated thereby, shall not constitute a Disposition, and (ii) the participation by a Non-YBR Holder in a proposed underwritten public offering of common stock or preferred stock of the Company (including the entry into an underwriting agreement, a custody agreement and other


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agreements ordinarily executed by selling Holders in connection therewith), which public offering, if consummated, would constitute a Qualified Public Offering, and the consummation thereof, or the participation by a Non-YBR Holder in any other registration pursuant to any demand or piggyback registration rights that such Non-YBR Holder may have pursuant to any registration rights or similar agreement with the Company and the consummation thereof, shall not constitute a Disposition, it being understood that, if such proposed underwritten public offering is terminated or abandoned prior to consummation or is not consummated in a manner which constitutes a Qualified Public Offering, or such other registration is terminated or abandoned prior to consummation or is not consummated, the Common Stock or Preferred Stock of such participating Non-YBR Holder shall remain subject to this Agreement and no Disposition thereof (whether pursuant to agreement entered into in connection with such proposed underwritten public offering or otherwise) shall be permitted hereunder without compliance with the terms of this Agreement. The term Disposition shall include a Control Disposition.


"Divorced Non-YBR Holder" has the meaning ascribed to such term in
----------------------- Section 2.1.


"Divorced Spouse" has the meaning ascribed to such term in Section
--------------- 2.1.


"Eligible Offerees" means the Company and YBR.
-----------------


"Exchange Act" means the Securities Exchange Act of 1934, as amended,
------------ and the rules and regulations thereunder.


"Fair Market Value of the Shares of Common Stock" means as of any
----------------------------------------------- particular date (the "Determination Date") for a share of Common Stock the ratio
------------------ of (a) the sum of (i) the product of (A) the ratio of (I) the cash purchase price paid by YBR, the Apollo Group and their Affiliates for the equity of the Company as of the Original Issue Date plus the value of the equity retained by IMC Global, Inc. on the Original Issue Date plus or minus any post-closing adjustments made in connection with the agreement evidencing the merger between an affiliate of YBR and the Company to (II) the Company's consolidated earnings before interest, taxes, depreciation and amortization ("EBITDA") for the 12
------ months prior to the Original Issue Date as described in the Company's applicable high yield prospectus and (B) the Company's EBITDA for the 12 months prior to the Determination Date calculated on the same basis as EBITDA was calculated for the 12 months prior to the Original Issue Date plus (ii) the amount that would be received by the Company upon the exercise of all Options outstanding that have an exercise price that is less than the fair market value per share of Common Stock as of the Determination Date, such fair market value to be determined assuming the receipt of amounts for the exercise of all Options outstanding unless after such assumption the fair market value per share of Common Stock is less than the exercise price per share of the Options ("In the
------ Money Options") minus (iii) the amount of the Company's net debt and Fair Market - ------------- Value of the Shares of Preferred Stock as of the Determination Date to (b) the number of shares of Common Stock outstanding as of the Determination Date determined on a fully diluted basis (including the number of shares subject to In-the Money Options as of such date). For purposes of this definition of Fair Market Value of the Shares of Common Stock, EBITDA for the 12 months prior to the Determination Date shall be adjusted to take into account a materially good or bad winter pursuant to the terms


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agreed to by YBR and the Company's Chief Executive Officer, which terms shall be set forth on Annex I hereto (or other factors that may be appropriate from time
------- to time). The Company shall deliver a written notice to Holders on a quarterly basis of such Fair Market Value.


"Fair Market Value of the Shares of Preferred Stock" means the per
-------------------------------------------------- share fair market value of the outstanding Preferred Stock of the Company, which shall be calculated as of any Determination Date as the sum of the Original Cost and the value of the dividends accrued, but not paid, to the Preferred Stock as such fair market value was last determined in good faith by the Board prior to the Offer or, if the Board determines in good faith that such fair market value has materially changed from the amounts as last determined by the Board prior to the Offer, the fair market value as determined in good faith by the Board as of the most recent practicable date prior to the Offer; provided, however, that if
-------- ------- shares of Preferred Stock are publicly traded or quoted at the time of any Offer, then the fair market value of such shares shall be the most recently quoted trading price on the business day immediately prior to the Offer. The Board shall have no obligation to determine such fair market value at any time. Neither the Company nor any officer, director, employee or agent of the Company shall have any liability with respect to valuation of shares of Preferred Stock that are bought or sold at the fair market value, as determined pursuant to this paragraph even though the fair market value, as so determined, may be more or less than actual fair market value, and shall be fully protected in relying in good faith upon the records of the Company and upon information, opinions, reports or statements presented to the Company by any Person as to matters which the Company or such director, officer, employee or agent reasonably believes are within such other Person's professional or expert competence and who has been selected with reasonable care by or on behalf of the Company. The fair market value of Preferred Stock as of the date of this Agreement and until the first determination of fair market value thereof by the Board shall, for purposes of this paragraph, be deemed to be Original Cost, subject to appropriate adjustment by the Board for stock splits, stock dividends, combinations and similar transactions. The Company shall deliver a written notice to Holders on a quarterly basis of such Fair Market Value.


"Good Reason" means voluntary resignation after any of the following
----------- actions are taken by the Company or any of its subsidiaries without the Non-YBR Holder's consent: (a) the continued failure to pay compensation when due to the Non-YBR Holder for more than 30 (30) days; (b) a significant diminution in the responsibilities or authority of the Non-YBR Holder; (c) a significant diminution in the annual base compensation and other benefits to be paid to the Non-YBR Holder (but not including any diminution related to a broader compensation or benefit reduction that is not limited to any particular employee) or (d) relocation of the Non-YBR Holder's primary work place beyond a fifty (50) mile radius of the employee's current location; provided, that none of the events described in the foregoing clauses (a), (b), (c) or (d) shall constitute Good Reason unless the Non-YBR Holder shall have notified the Company in writing describing the events which constitute Good Reason and then only if the Company shall have failed to cure such event within 30 days after the Company's receipt of such written notice.


"Group" shall have the meaning ascribed thereto in Section 13(d)(3) of
----- the Exchange Act.


"Holders" means the holders of securities of the Company (and the
------- Persons who have a right to receive securities of the Company pursuant to Options or any deferred


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compensation plan) who are parties hereto or to any other similar investor rights agreement or stockholders agreement.


"Initial Purchased Shares" shall mean, with respect to each Non-YBR
------------------------ Holder, all shares of Common Stock and Preferred Stock (a) purchased by such Non-YBR Holder as of the Original Issue Date and (b) issuable to such Non-YBR Holder pursuant to a distribution from the Company's Senior Executives' Deferred Compensation Plan pursuant to any deferral election made thereunder on or prior to the Original Issue Date, and any securities of the Company which may be issued or distributed with respect to, or in exchange or substitution for, or conversion of, such Initial Purchased Securities.


"IRA" has the meaning ascribed to such term in Section 6.2(c).
---


"Material Agreement" has the meaning ascribed to such term in Section
------------------ 4.1.


"Non-Initial Purchased Shares" shall mean all shares of Common Stock
---------------------------- or Preferred Stock that may be purchased by, transferred to, or are otherwise held by, any Non-YBR Holder (whether upon the exercise of an Option or otherwise) other than Initial Purchased Shares.


"Non-YBR Holders" means Holders other than the Company and YBR.
---------------


"Notice" has the meaning ascribed to such term in Section 4.1.
------


"Offer" has the meaning ascribed to such term in Section 2.1, 2.2,
----- 2.3, 2.4 or 2.5, as applicable.


"Option" means the options issued to Holders pursuant to the Company's
------ 2001 Stock Option Plan, as it is amended, supplemented or restated from time to time, or any other option plan approved by the Company.


"Original Cost" means:
-------------


(a) With respect to a share of Common Stock, $10 per share,
subject to appropriate adjustment by the Board for stock splits, stock
dividends, combinations and similar transactions; and


(b) With respect to a share of Preferred Stock, $1,000 per
share, subject to appropriate adjustment by the Board for stock
splits, stock dividends, combinations and similar transactions.


"Original Issue Date" means the date of consummation of the merger
------------------- between YBR and the Company.


"Person" shall be construed broadly and shall include, without
------ limitation, an individual, a partnership, a corporation, an association, a joint stock company, a limited liability company, a trust, a joint venture, an unincorporated organization and a governmental entity or any department agency or political subdivision thereof.


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"Piggy-Back Registration Rights" has the meaning ascribed to such term
------------------------------ in Section 10.


"Preferred Stock" means shares of any class of preferred stock of the
--------------- Company issued and outstanding as of the Original Issue Date or any exchange debentures issued in exchange for such preferred stock pursuant to its terms.


"Proportionate Percentage" means, with respect to any Holder, (i) in
------------------------ respect of shares of Common Stock, a fraction (expressed as a percentage) the numerator of which is the total number of shares of Common Stock held by such Holder (including any shares of Common Stock that such Holder purchases pursuant to any Option exercised in connection with the applicable Section 4.2 Transaction or any shares distributed pursuant to any deferred compensation plan in connection with the applicable Section 4.2 Transaction) and the denominator of which is the total number of shares of Common Stock outstanding at the time of determination (including any shares of Common Stock that such Holder purchases pursuant to any Option exercised in connection with the applicable Section 4.2 Transaction or any shares distributed pursuant to any deferred compensation plan in connection with the applicable Section 4.2 Transaction) and (ii) in respect of the Preferred Stock, a fraction (expressed as a percentage) the numerator of which is the total number of shares of Preferred Stock held by such Holder and the denominator of which is the total number of shares of Preferred Stock outstanding at the time of determination.


"Public Sale" means any sale, occurring simultaneously with or after
----------- an initial public offering, of Common Stock or Preferred Stock to the public pursuant to an offering registered under the Securities Act or to the public in the manner described by the provisions of Rule 144(f).


"Purchase Price" means, subject to adjustment pursuant to Section 3.5
-------------- and the provisions of this paragraph, (i) for purposes of the purchase of Securities Subject to the Offer under Sections 2.1, 2.2, 2.3 or 2.5, and shares of Common Stock or Preferred Stock purchased by a Divorced Non-YBR Holder or a Surviving Non-YBR Holder under Sections 2.1 or 2.2, the Original Cost of such Securities Subject to the Offer and (ii) for purposes of the purchase of Securities Subject to the Offer under Section 2.4, the Fair Market Value of the shares of Common Stock and the Fair Market Value of the Shares of Preferred Stock.


"Qualified Public Offering" means an underwritten public offering of
------------------------- Common Stock by the Company pursuant to an effective registration statement filed by the Company with the Securities and Exchange Commission (other than on Forms S-4 or S-8 or successors to such forms) under the Securities Act, pursuant to which the aggregate offering price of the Common Stock sold in such offering is at least $100,000,000.


"Qualified Preferred Public Offering" means an underwritten public
----------------------------------- offering of Preferred Stock by the Company pursuant to an effective registration statement filed by the Company with the Securities and Exchange Commission (other than on Forms S-4 or S-8 or successors to such forms) under the Securities Act, pursuant to which the aggregate offering price of the Preferred Stock sold in such offering is at least $50,000,000.


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"Receipt Notice" has the meaning ascribed to such term in Section 3.4.
--------------


"Required Voting Percentage" means a majority of the shares of Common
-------------------------- Stock outstanding owned by the Holders as of the date the vote is taken and the vote of the shares of Common Stock owned by YBR.


"Sale Notice" has the meaning ascribed to such term in Section 4.2(a).
-----------


"Section 4.2 Transaction" has the meaning ascribed to such term in
----------------------- Section 4.2(a).


"Securities Act" means the Securities Act of 1933, as amended, and the
-------------- rules and regulations thereunder.


"Securities Subject to the Offer" means: (i) with respect to an Offer
------------------------------- required under Section 2.1, all shares of Common Stock and Preferred Stock transferred to or retained by or vested in the Divorced Spouse (defined therein) and not elected to be purchased by the Divorced Non-YBR Holder (as defined therein) within the time limits specified in that section, and no others; (ii) with respect to an Offer required under Section 2.2, all shares of Common Stock and Preferred Stock vesting in or transferable to any heir or legatee of the deceased spouse other than the Surviving Non-YBR Holder (as defined in that Section) and not elected to be purchased by the Surviving Non-YBR Holder within the time limits specified in that Section, and no others; and (iii) all shares of Common Stock and Preferred Stock owned by a Non-YBR Holder required to make an Offer under Sections 2.3, 2.4 and 2.5.


"Subject Employee" has the meaning ascribed to such term in Section
---------------- 6.2(c).


"Surviving Non-YBR Holder" has the meaning ascribed to such term in
------------------------ Section 2.2.


"Tag Along Holder" has the meaning ascribed to such term in Section
---------------- 4.2(a).


"Tag Along Notice" has the meaning ascribed to such term in Section
---------------- 4.2(a).


"YBR" means YBR Holdings LLC, a Delaware limited liability company.
---


Section 2. General Rule.
------------


Without limiting Section 7, except as expressly permitted by the terms of Sections 2, 4, 5, 9 and 10 without the consent of the Company, no Non-YBR Holder shall make any Disposition, directly or indirectly, through an Affiliate or otherwise. The preceding sentence shall apply with respect to all shares of Common Stock and Preferred Stock held at any time by a Non-YBR Holder (including without limitation to all shares of Common Stock acquired upon the exercise of any stock option or upon the distribution from any deferred compensation plan), regardless of the manner in which such Non-YBR Holder initially acquired Common Stock or Preferred Stock, as applicable. In the event of a conflict between any provision of this Section 2 and Section 9, the terms of Section 9 shall control.


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2.1 Divorce of Non-YBR Holder.
-------------------------


If the marital relationship of a Non-YBR Holder is terminated by divorce, and pursuant to such divorce, or any property settlement in connection with such divorce, Common Stock or Preferred Stock, previously registered in the name of such Non-YBR Holder ("Divorced Non-YBR Holder") are transferred to, or a
----------------------- community property interest or similar marital property interest is retained by or vested in, the spouse of the Divorced Non-YBR Holder ("Divorced Spouse"), the
--------------- Divorced Non-YBR Holder shall promptly notify the Company of such event. The Divorced Non-YBR Holder shall have the option to purchase all of the Divorced Non-YBR Holder's Common Stock and all of the Divorced Non-YBR Holder's Preferred Stock, which have been transferred to or which are retained by or vested in the Divorced Spouse by virtue of the divorce decree, property settlement, or by operation of the community property or similar marital property laws for the Purchase Price, and the Divorced Spouse shall be obligated to sell such Common Stock and such Preferred Stock, to the Divorced Non-YBR Holder for the Purchase Price. Such option must be exercised, and the purchase consummated, within 30 days after the Common Stock and the Preferred Stock are transferred to or otherwise vested in or allowed to be retained by the Divorced Spouse. The option shall be exercised by the giving of written notice of exercise to the Divorced Spouse. The Divorced Non-YBR Holder shall, within five days after the expiration of such 30 day period, deliver written notice to the Company as to whether the Divorced Non-YBR Holder has purchased all of the Common Stock and the Preferred Stock, so transferred to or otherwise vested in or retained by the Divorced Spouse. In the event such written notice states that the Divorced Non-YBR Holder has not purchased all such Common Stock and Preferred Stock, or no such notice is delivered to the Company within the time required, the Divorced Spouse shall be deemed to have made an irrevocable offer (the "Offer") of all such Common
----- Stock and Preferred Stock, to the Eligible Offerees, and the Company shall (and is hereby authorized by the Non-YBR Holders and their respective spouses to), within five business days after (i) the receipt of such notice, if delivered within the time required, or (ii) if such notice is not delivered within the time required, the receipt by the Company of evidence, satisfactory to it that all such Common Stock and Preferred Stock, were not purchased by the Divorced Non-YBR Holder within such 30 day period, deliver written notice of the Offer to the Eligible Offerees stating all such Common Stock and Preferred Stock are Securities Subject to the Offer pursuant to this Section 2.1, and the date of such Offer shall be deemed to be the date such written notice of the Offer is so delivered by the Company.


2.2 Death of Spouse.
---------------


If the spouse of a Non-YBR Holder dies, and all or any portion of the Common Stock and/or Preferred Stock registered in the name of such Non-YBR Holder ("Surviving Non-YBR Holder") vests i ...