EXHIBIT (d)(2)
FORM OF
EXCHANGE AGREEMENT
THIS EXCHANGE AGREEMENT, dated as of _____________, 2004 (this
"Agreement"), is by and among JAC Acquisition Company, Inc., a Delaware
corporation ("JAC") and each of the parties listed on Exhibit A hereto (each in
his, her or its individual capacity, a "Stockholder," and, collectively, the
"Stockholders").
W I T N E S S E T H:
WHEREAS, the Joule Inc. (the "Company") and JAC have entered
into an Agreement and Plan of Merger, dated as of March 19, 2004 (the "Merger
Agreement"), pursuant to which JAC will merge with and into the Company, with
the Company being the surviving corporation (the "Merger");
WHEREAS, as of the date hereof, each Stockholder owns,
beneficially and of record, the number of shares of common stock, par value $.01
per share of the Company (the "Company Shares") set forth beside such
Stockholder's name on Exhibit A (all such Company Shares, together with any
additional Company Shares which may hereafter be acquired by such Stockholder
prior to the termination of this Agreement, whether upon the exercise of options
or by means of purchase, dividend, distribution or otherwise, being referred to
herein as the "Owned Shares") and one share of common stock, par value $.01 per
share, of JAC (the "JAC Common"); and
WHEREAS, it is contemplated and agreed that each Stockholder
will contribute the Owned Shares owned by him or her to JAC immediately prior to
consummation of the Merger in exchange for newly issued shares of capital stock
of JAC as provided herein;
NOW, THEREFORE, in consideration of the foregoing and the mutual
covenants and agreements herein contained, and intending to be legally bound
hereby, JAC and each Stockholder hereby agree as follows:
ARTICLE I
COVENANTS OF THE STOCKHOLDERS
Section 1.1 No Inconsistent Arrangements. Except as
contemplated by this Agreement and the Merger Agreement, no Stockholder shall
during the term (i) transfer (which term shall include, without limitation, any
sale, assignment, gift, pledge, hypothecation or other disposition), or consent
to any transfer of, any or all of the Owned Shares or any interest therein, or
create or permit to exist any Encumbrance (as defined in Section 3.3 hereof) on
such Owned Shares, (ii) enter into any contract, option or other agreement or
understanding with respect to
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any transfer of any or all of the Owned Shares or any interest therein, (iii)
grant any proxy, power-of-attorney or other authorization in or with respect to
the Owned Shares, (iv) deposit the Owned Shares into a voting trust or enter
into a voting agreement or arrangement with respect to the Owned Shares, or (v)
take any other action that would in any way restrict, limit or interfere with
the performance of its obligations hereunder or the transactions contemplated
hereby.
Section 1.2 Stop Transfer. No Stockholder shall request that
the Company register the transfer (book-entry or otherwise) of any certificate
or uncertificated interest representing any of the Owned Shares, unless such
transfer is made in compliance with this Agreement.
Section 1.3 Indemnity. The representations, warranties and
agreements made by each Stockholder herein shall survive the closing of this
Exchange (as defined in Section 2.1) as anticipated hereby. Each Stockholder
hereby agrees to indemnify and hold harmless JAC from and against any and all
loss, liability, claim, damage and expense (including, without limitation,
attorney's fees and disbursements) suffered or incurred as a result of a
misrepresentation or breach of any warranty or agreement made by such
Stockholder in this Agreement.
ARTICLE II
EXCHANGE OF OWNED SHARES
Section 2.1 Exchange. The equity capitalization of JAC
immediately following the Exchange (as defined below) shall be as set forth on
Exhibit B hereto (the "JAC Equity Schedule"). Each Stockholder shall, upon
receipt of notice from the Secretary of Joule that the 20-day waiting period
following the mailing of the Information Statement relating to the Merger to the
stockholders of Joule, exchange such Stockholder's Owned Shares for newly issued
shares of JAC common stock (the "JAC Shares") consistent with the JAC Equity
Schedule (the "Exchange").
Section 2.2 Certain Warranties. The contribution by the
Stockholders of the Owned Shares to JAC pursuant to this Agreement shall pass to
and unconditionally vest in JAC good and valid title to the Owned Shares, free
and clear of all Encumbrances whatsoever.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE STOCKHOLDERS
By executing this Agreement, each Stockholder makes the
following representations, declarations and warranties to JAC, with the intent
and understanding that JAC will rely thereon:
Section 3.1 Due Authorization. Such Stockholder has all
requisite power and authority to execute, deliver and perform this Agreement and
to consummate the transactions contemplated hereby. The execution, delivery and
performance of this Agreement and the
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consummation of the transactions contemplated hereby have been duly authorized
by all necessary action on the part of such Stockholder. This Agreement has been
duly executed and delivered by or on behalf of such Stockholder and constitutes
a legal, valid and binding obligation of such Stockholder, enforceable against
such Stockholder in accordance with its terms.
Section 3.2 No Conflicts; Consents.
(a) Except as would not impair or delay the ability
of such Stockholder to consummate the transactions contemplated hereby, the
execution and delivery of this Agreement by such Stockholder does not, and the
performance of this Agreement by such Stockholder will not, (i) conflict with or
violate any law applicable to such Stockholder or by which such Stockholder or
any of such Stockholder's assets is bound or affected or (ii) result in any
breach of or constitute a default (or an event that with notice or lapse of time
or both would become a default) under, or give to others any rights of
termination, acceleration or cancellation of, or result in the creation of an
Encumbrance on any assets of such Stockholder, including, without limitation,
the Owned Shares, pursuant to any note, bond, mortgage, indenture, contract,
agreement, lease, license, permit, franchise or other instrument or obligation
to which such Stockholder is a party or by which such Stockholder or any of such
Stockholder's assets is bound or affected.
(b) Except as would not impair or delay the ability
of such Stockholder to consummate the transactions contemplated hereby, the
execution and delivery of this Agreement by such Stockholder does not, and the
performance of this Agreement by such Stockholder will not, require any consent,
approval, authorization or permit of, or filing with or notification to, any
governmental or regulatory authority (other than any necessary filing under the
Securities Exchange Act of 1934, as amended).
Section 3.3 Title to Owned Shares. Except as disclosed to
JAC in writing by such Stockholder, such Stockholder is the sole record and
beneficial owner of the Owned Shares, free and clear of any pledge, lien,
security interest, mortgage, charge, claim, equity, option, proxy, voting
restriction, voting trust or agreement, understanding, arrangement, right of
first refusal, limitation on disposition, adverse claim of ownership or use or
encumbrance of any kind (collectively, "Encumbrances"), except for Encumbrances
arising pursuant to this Agreement. As of the date hereof, the Owned Shares
listed on Exhibit A beside such Stockholder's name under the caption "Number of
Owned Shares" are the only Company Shares, together with any additional Company
Shares which may hereafter be acquired by such Stockholder prior to the
termination of this Agreement, whether upon the exercise of options or by means
of purchase, dividend, distribution or otherwise, owned of record or
beneficially by such Stockholder. No member of such Stockholder's family who is
not also a Stockholder owns, beneficially or of record, any Company Shares.
Section 3.4 No Finder's Fees. No broker, investment banker,
financial advisor or other person is entitled to any broker's, finder's,
financial advisor's or other similar fee or commission in connection with the
transactions contemplated hereby based upon arrangements made by or on behalf of
such Stockholder. Such Stockholder, on behalf of itself and its affiliates,
hereby acknowledges that it is not entitled to receive any broker's, finder's,
financial advisor's or
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other similar fee or commission in connection with the transactions contemplated
hereby. Such Stockholder agrees and acknowledges that the Exchange is being made
without an underwriter or placement agent who would have responsibilities to any
of the Stockholders, and accordingly, such Stockholder agrees and acknowledges
such Stockholder's sole responsibility for a "due diligence" investigation of
JAC.
Section 3.5 Investment Intent.
(a) Such Stockholder is an "accredited investor" as
that term is defined in Regulation D of the Securities Act of 1933, as amended
(the "Securities Act"). Such Stockholder understands that such Stockholder must
bear the economic risk of an investment in JAC Shares for an indefinite period.
Such Stockholder is investing in JAC Shares for such Stockholder's own account
as principal for investment and not with a view toward resale or distribution.
(b) The Stockholder has been advised and is aware
that: (1) there is no public market for JAC Shares and it is not likely that any
public market will develop; and (ii) JAC Shares have not been registered under
the Securities Act, or the securities laws of any state or other jurisdiction
and, therefore, cannot be sold except in compliance with such laws. Such
Stockholder agrees not to sell or otherwise dispose of JAC Shares acquired by
such Stockholder unless JAC Shares are subsequently registered under the
Securities Act and such state securities laws as are applicable or unless there
are available exemptions from such registration that are supported by an opinion
of counsel for such Stockholder, which opinion is satisfactory in form and
substance to the Company. Such Stockholder has no present arrangement,
understanding or agreement for transferring or disposing of any or all shares of
JAC. Such Stockholder agrees that a legend to the foregoing effect may be placed
upon any and all certificates representing shares of JAC.
(c) Stockholder hereby agrees to cooperate with JAC
in all of its efforts to comply with any applicable federal, state or local
statutes and regulations.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF JAC
JAC hereby represents and warrants to each Stockholder as
follows:
Section 4.1 Due Organization, Authorization, etc. JAC is
duly organized, validly existing and in good standing under the laws of the
State of Delaware. JAC has all requisite corporate power and authority to
execute and deliver this Agreement and to consummate the transactions
contemplated hereby. The execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby by JAC have been duly
authorized by all necessary corporate action on the part of JAC. This Agreement
has been duly executed and delivered by JAC and constitutes a legal, valid and
binding obligation of JAC, enforceable against JAC in accordance with its terms.
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Section 4.2 Investment Intent. JAC will be acquiring the
Owned Shares pursuant to the Exchange for its own account and not with a view to
distribution or resale in any manner which would be in violation of the
Securities Act.
ARTICLE V
MISCELLANEOUS
Section 5.1 Termination. This Agreement shall terminate and
be of no further force and effect: (i) upon the written mutual consent of the
parties hereto and (ii) automatically and without any required action of the
parties hereto upon termination of the Merger Agreement. No such termination of
this Agreement shall relieve any party hereto from any liability for any breach
of this Agreement prior to termination.
Section 5.2 Further Assurance. From time to time, at another
party's request and without additional consideration, each party hereto shall
execute and deliver such additional documents and take all such further action
as may be necessary or desirable to consummate and make effective, in the most
expeditious manner practicable, the transactions contemplated by this Agreement.
Section 5.3 Specific Performance. Each Stockholder
acknowledges that if such Stockholder fails to perform any of its obligations
under this Agreement, immediate and irreparable harm or injury would be caused
to JAC for which money damages would not be an adequate remedy. In such event,
each Stockholder agrees that JAC shall have the right, in addition to any other
rights that it may have, to specific performance of this Agreement. Accordingly,
if JAC should institute an action or proceeding seeking specific enforcement of
the provisions hereof, each Stockholder hereby waives the claim or defense that
JAC has an adequate remedy at law and hereby agrees not to assert in any such
action or proceeding the claim or defense that such a remedy at law exists. Each
Stockholder further agrees to waive any requirements for the securing or posting
of any bond in connection with obtaining any such equitable relief.
Section 5.4 Notice. All notices, requests, claims demands
and other communications under this Agreement shall be in writing and shall be
deemed given if delivered personally or sent by overnight courier (providing
proof of delivery) to the parties at the following addresses (or at such other
address for a party as shall be specified by like notice):
(a) If to JAC:
JAC Acquisition Company, Inc.
x/x Xxxxxxxx Xxxxxx
00 Xxxxxxxxxxxx Xxxxx
Xxxxxxxxxx, Xxx Xxxxxx 00000
Attn: Xxxxxxx X. Xxxxxxxxxx
(b) If to a Stockholder:
To the appropriate address shown on Exhibit A.
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Section 5.5 Headings. The headings contained in this
Agreement are for reference purposes only and shall not affect in any way the
meaning or interpretation of this Agreement.
Section 5.6 Severability. If any term or other provision of
this Agreement is invalid, illegal or incapable of being enforced by any rule of
law or public policy, all other conditions and provisions of this Agreement
shall nevertheless remain in full force and effect so long as the economic or
legal substance of the transactions contemplated hereby is not affected in any
manner adverse to any party. Upon such determination that any term or other
provision is invalid, illegal or incapable of being enforced, the parties hereto
shall negotiate in good faith to modify this Agreement so as to effect the
original intent of the parties as closely as possible in an acceptable manner to
the end that transactions contemplated hereby are fulfilled to the maximum
extent possible.
Section 5.7 Entire Agreement; No Third-Party Beneficiaries.
This Agreement constitutes the entire agreement among the parties hereto and
supersedes all other prior agreements and understandings, both written and oral,
among the parties with respect to the subject matter of this Agreement, and this
Agreement is not intended to confer upon any person, other than the parties
hereto, any rights or remedies.
Section 5.8 Assignment. Neither this Agreement nor any of
the rights, interests or obligations under this Agreement may be assigned or
delegated, in whole or in part by any of the parties, other than by operation of
law; provided, however, that JAC may assign, in its sole discretion, its rights
and obligations hereunder to any direct or indirect wholly-owned subsidiary of
JAC, but no such assignment shall relieve JAC of its obligations hereunder if
such assignee does not perform such obligations. Each Stockholder agrees that
this Agreement and such Stockholder's obligations hereunder shall attach to the
Owned Shares and shall be binding upon any person or entity to which legal or
beneficial ownership of the Owned Shares shall pass by operation of law.
Section 5.9 Governing Law. This Agreement shall be governed
by, and construed in accordance with, the laws of the State of New York,
regardless of the laws that might otherwise govern under applicable principles
of conflicts of laws thereof. Each of the parties hereto (a) hereby irrevocably
and unconditionally consents to submit to the personal jurisdiction of the
courts of the State of New York and of the United States of America located in
the State of New York in the event any dispute arises out of this Agreement or
any of the transactions contemplated by this Agreement, (b) shall not object to
or attempt to deny or defeat such personal jurisdiction by motion or other
request for leave from any such court, and (c) shall not bring any action
relating to this Agreement or any of the transactions contemplated by this
Agreement in any other court.
Section 5.10 WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO
HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL
PROCEEDING ARISING OUT OF OR RELATED TO THIS AGREEMENT OR THE TRANSACTIONS
CONTEMPLATED HEREBY.
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Section 5.11 Amendment. This Agreement may not be amended
except by an instrument in writing signed by the parties hereto.
Section 5.12 Waiver. Any party hereto may (a) extend the time
for the performance of any of the obligations or other acts of the other parties
hereto, (b) waive any inaccuracies in the representations and warranties of the
other parties hereto contained herein or in any document delivered pursuant
hereto and (c) waive compliance by the other parties hereto with any of their
agreements or conditions contained herein. Any agreement on the part of a party
hereto to any such extension or waiver shall be valid only as against such party
and only if set forth in an instrument in writing signed by such party. The
failure of any party hereto to assert any of its rights under this Agreement or
otherwise shall not constitute a waiver of those rights.
Section 5.13 Counterparts. This Agreement may be executed in
one or more counterparts, all of which shall be considered one and the same
instrument and shall become effective when one or more counterparts have been
signed by each of the parties and delivered to the other parties.
SIGNATURE PAGE FOLLOWS
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IN WITNESS WHEREOF, the parties have executed this Exchange
Agreement as of the date first above written.
PURCHASER
JAC ACQUISITION COMPANY, INC.
By:
----------------------------------
Name:
Title:
STOCKHOLDERS
-------------------------------------
Xxxxxxx X. Xxxxxxxxxx
-------------------------------------
Xxxxx Xxxxxxxxxx
-------------------------------------
Xxxx X. Xxxxxxxxxx
-------------------------------------
Xxxxxx Xxxxxxxxxx
-------------------------------------
Xxxxx Xxxxxxxxxx
-------------------------------------
Xxxx X. Xxxxxxx, Xx.
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EXHIBIT A
LIST OF OWNED SHARES
NAME AND ADDRESS NUMBER OF OWNED SHARES % OF CLASS
------------------------- ---------------------- ----------
Xxxxxxx X. Xxxxxxxxxx (1) 807,125 21.9%
c/o Joule Inc.
0000 X.X. Xxxxx 0 Xxxxx
Xxxxxx, XX 00000
Xxxxx Xxxxxxxxxx (2) 360,622 9.8%
c/o Joule Inc.
0000 X.X. Xxxxx 0 Xxxxx
Xxxxxx, XX 00000
Xxxx X. Xxxxxxxxxx 476,722 12.9%
00 Xxxxxxxxxxxx Xxxxx
Xxxxxxxxxx, XX 00000
Xxxxxx Xxxxxxxxxx 476,622 12.9%
00 Xxxxxx Xxxx
Xxxxxx, XX 00000
Xxxxx Xxxxxxxxxx 493,348 13.4%
00 XxXxxxxx Xxxxxx
Xxxxxx, XX 00000
Xxxx X. Xxxxxxx, Xx. (3) 22,075 0.6%
c/o Joule Inc.
0000 X.X. Xxxxx 0 Xxxxx
Xxxxxx, XX 00000
------------ ----------
Total 2,636,514 71.5%
------------ ----------
(1) Excludes 360,622 shares of common stock beneficially owned solely by
Xxxxx Xxxxxxxxxx as to which shares he disclaims beneficial ownership.
(2) Excludes 807,100 shares of common stock beneficially owned solely by
Xxxxxxx X. Xxxxxxxxxx as to which shares she disclaims beneficial
ownership.
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EXHIBIT B
JAC EQUITY SCHEDULE
NAME NUMBER OF SHARES % OF CLASS
------------------------- ---------------- ----------
Xxxxxxx X. Xxxxxxxxxx (1) 2,191 30.6%
Xxxxx Xxxxxxxxxx (2) 979 13.7%
Xxxx X. Xxxxxxxxxx 1,294 18.1%
Xxxxxx Xxxxxxxxxx 1,294 18.1%
Xxxxx Xxxxxxxxxx 1,339 18.7%
Xxxx X. Xxxxxxx, Xx. 60 0.8%
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Total 7,157 100%
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