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EXHIBIT (c)(2)
STOCK PURCHASE AGREEMENT
STOCK PURCHASE AGREEMENT (this "Agreement"), dated as of July
10, 1997, by and between Insilco Corporation, a Delaware corporation (the
"Company"), and Xxxxxx X. Xxxxxxx ("Shareholder").
WHEREAS, the Company desires to purchase up to 5,714,284
shares of Common Stock, par value $.001, of the Company (the "Shares"),
constituting 59.7% of the outstanding Shares;
WHEREAS, Shareholder owns 127,014 Shares, constituting 1.3% of
the outstanding Shares;
WHEREAS, the Company intends, within one business day from the
date hereof, to commence a tender offer to purchase up to 2,857,142 Shares at a
purchase price of $38.50 per Share in cash in all material respects on the
terms of the draft Tender Offer Statement on Schedule 13E-4 delivered to
Shareholder on the date hereof (the "Offer");
WHEREAS, the Company desires to purchase from Shareholder and
Shareholder desires to sell to the Company 51,948 Shares (the "RLS Shares") at
a purchase price of $38.50 per Share in cash pursuant to this Agreement;
WHEREAS, on March 5, 1997, the Company sold its Rolodex office
products business (the "Rolodex Sale") for gross proceeds of $117 million;
WHEREAS, the Board of Directors of the Company adopted a plan
of partial liquidation with respect to a distribution of the proceeds of the
Rolodex Sale and filed a Form 966 with the Internal Revenue Service with
respect thereto; and
WHEREAS, immediately upon receipt of the proceeds of the
Rolodex Sale, the Company deposited $110 million of such proceeds (the "Rolodex
Proceeds") into a separate bank account, Link DDA Account, account no.
4072-3545, Citibank, New York (the "Link Account"), from which account the
Rolodex Proceeds were then deposited into CUSA FAO Insilco Corp. Cash
Collateral Custody Account, account no. 846-881, Citibank, Tampa (the "Rolodex
Proceeds Account").
WHEREAS, on the date hereof the Company has entered into an
agreement with Water Street Corporate Recovery Fund I, L.P. (the "Water Street
Stock Purchase Agreement") pursuant to which the Company is purchasing
2,805,194 Shares on substantially the same terms and conditions as this
Agreement.
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NOW, THEREFORE, in consideration of the foregoing and
intending to be legally bound hereby, the parties hereto hereby agree as
follows:
ARTICLE 1
PURCHASE AND SALE OF THE SHARES
Section 1.1. The Purchase. On the terms and subject to
the conditions of this Agreement, Shareholder hereby sells, transfers and
conveys the RLS Shares to the Company, and the Company hereby purchases the RLS
Shares from Shareholder, at a purchase price of $38.50 per Share for an
aggregate purchase price of $1,999,998 (the "Purchase Price"). Shareholder,
concurrently with the execution hereof, is delivering to the Company
certificates representing the RLS Shares together with stock powers duly
executed in blank (the "Stock Powers").
Section 1.2. Payment. On the terms and subject to the
conditions of this Agreement, in consideration for the sale of the RLS Shares,
concurrently with the execution hereof the Company is paying the Purchase Price
to Shareholder solely out of the Rolodex Proceeds by delivery to Shareholder of
a cashiers check drawn on the Link Account payable to the order of Shareholder
in the amount of $1,999,998.
ARTICLE 2
REPRESENTATIONS
Section 2.1. Representations of the Company. The Company
hereby represents and warrants to Shareholder that:
(a) The Company has all requisite corporate power and
authority to enter into this Agreement and to consummate the transactions
contemplated hereby.
(b) The execution and delivery by the Company of this
Agreement, and the consummation by the Company of the transactions contemplated
hereby, have been duly authorized by all necessary corporate action on the part
of the Company.
(c) This Agreement has been duly executed and delivered
by the Company and constitutes a valid and binding obligation of the Company
enforceable against the Company in accordance with its terms.
(d) At all times prior to the payment of the Purchase
Price referred to in Section 1.2, both the Rolodex Proceeds Account and the
Link Account contained only the Rolodex Proceeds and interest earned thereon
that had not yet been withdrawn by the Company. No distributions have been
made out of the Rolodex Proceeds Account other than to the Link Account, and no
distributions have been made out of the Link Account other than (i) pursuant to
this Agreement or the Water Street Stock Purchase
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Agreement, or (ii) to withdraw from time to time the interest earned on the
Rolodex Proceeds. The Purchase Price is being paid solely out of the Rolodex
Proceeds.
(e) The Company intends to commence the Offer on the
business day immediately following the date hereof.
Section 2.2. Representations of Shareholder. Shareholder
hereby represents and warrants to the Company that Shareholder owns the RLS
Shares, and is conveying the RLS Shares to the Company, free and clear of any
lien, pledge, security interest or other encumbrance whatsoever (collectively,
"Liens").
ARTICLE 3
COVENANTS
Section 3.1. Maintenance of Rolodex Proceeds. No later
than the next business day following the receipt thereof, Shareholder shall
deposit the Purchase Price in a segregated Cash Management Account at Xxxxxxx
Xxxxx, account no. 656 82C41 (the "Shareholder Account"), and shall maintain
such funds, together with all interest actually earned thereon, in the
Shareholder Account (and no other money shall be deposited in such account)
until the earlier of (x) the first date on which the Company pays for Shares
tendered in the Offer (the "Payment Date") or (y) the date on which Shareholder
returns the Purchase Price to the Company pursuant to Section 3.5(a).
Section 3.2. Offer; Agreement Not to Tender. (a) The
Offer shall be for not more than 2,857,142 Shares at a purchase price of $38.50
per Share and shall be in all material respects on the terms of the draft
Tender Offer Statement on Schedule 13E-4 delivered to Shareholder on the date
hereof.
(b) Shareholder shall not tender any Shares in the Offer.
(c) The Company shall not (i) accept for purchase or
purchase more than 2,857,142 Shares in the Offer (including in connection with
odd lot purchases), nor (ii) pay more than $38.50 per Share, nor (iii) extend
the Offer past 45 days from the date of its commencement, unless the Company
and Shareholder shall first have entered into a written agreement amending this
Agreement with respect thereto.
Section 3.3. Interest Payment. If the Company purchases
Shares in the Offer, Shareholder shall, on the Payment Date, pay to the
Company, by wire transfer of immediately available funds, all interest actually
earned on the Purchase Price from and including the date of its deposit in the
Shareholder Account up to the Payment Date.
Section 3.4. Rescission. If the Offer expires or
terminates without any Shares having been purchased therein, the purchase and
sale of the RLS Shares pursuant to this Agreement shall automatically, and
without any further action by any party, be rescinded (the "Rescission"). The
Company shall promptly notify Shareholder in writing of the Rescission.
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Section 3.5. Effect of Rescission. If there is a
Rescission, then on the business day immediately following receipt by
Shareholder of written notice of the Rescission:
(a) Shareholder shall return to the Company the Purchase
Price, together with all interest actually earned thereon from and including
the date of its deposit in the Shareholder Account up to the date of such
return, by wire transfer of immediately available funds from the Shareholder
Account to the Link Account; and
(b) the Company shall return to Shareholder the
certificates representing the RLS Shares, together with the Stock Powers, free
and clear of all Liens, other than Liens created by Shareholder.
Section 3.6. Agreement Not To Sell. Shareholder agrees
that until the earlier of the acceptance by the Company of Shares tendered in
the Offer for payment and the expiration or termination of the Offer without
any Shares having been purchased therein, he shall not sell, transfer, assign,
pledge, distribute or otherwise dispose of the Shares beneficially owned by him
on the date hereof, other than pursuant to this Agreement.
ARTICLE 4
MISCELLANEOUS
Section 4.1. Governing Law. This Agreement shall be
construed in accordance with and governed by the laws of the State of New York
applicable to agreements made and to be performed wholly within such
jurisdiction.
Section 4.2. Severability. If any provision of this
Agreement is invalid, illegal or incapable of being enforced by any rule of law
or public policy, all other 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 adverse manner to
any party. Upon such determination that any 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 so that the transactions
contemplated hereby are fulfilled to the greatest extent possible.
Section 4.3. Counterparts; Facsimile Signatures. This
Agreement may be executed in any number of counterparts, each of which shall be
deemed to be an original, but all of which together shall constitute but one
and the same agreement. Delivery of a photocopy or transmission by telecopy of
a signed signature page of this Agreement shall constitute delivery of such
signed signature page.
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Section 4.4. Notice. All notices and other communications
required or permitted to be given under this Agreement shall be in writing and
shall be deemed to have been validly given, made or served on the date of
delivery, if delivered personally or by telecopier, or on the day after having
been sent by overnight courier, or seven days after having been sent by
registered or certified mail, return receipt requested, postage prepaid, to the
other party to this Agreement at the following address or to such other address
as such party shall specify by notice to the other party:
(a) If to the Company, addressed to:
Insilco Corporation
000 Xxxxx Xxxxx X.
Xxxxx Xxxxx
Xxxxxx, Xxxx 00000
Attention: Vice President and
General Counsel
Telephone: (000) 000-0000
Telecopier: (000) 000-0000
with a copy to
Fried, Frank, Harris, Xxxxxxx & Xxxxxxxx
Xxx Xxx Xxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx Xxxxxxx
Telephone: (000) 000-0000
Telecopier: (000) 000-0000
(b) If to Shareholder, addressed to:
Xxxxxx X. Xxxxxxx
0000 Xxxx Xxxxx Xxx
Xxxxxx, Xxxx 00000
Telephone: (000) 000-0000
Section 4.5. Exclusive Agreement. This Agreement
constitutes the sole understanding of the parties with respect to the subject
matter hereof and any verbal or written communication between the parties prior
to the adoption of this Agreement shall be deemed merged herein and of no
further force or effect.
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IN WITNESS WHEREOF, the parties have executed this Agreement
and caused the same to be duly delivered on their behalf as of the day and year
first written above.
INSILCO CORPORATION
By: /s/ Xxxxxxx X. Xxxx
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Name: Xxxxxxx X. Xxxx
Title: Vice President
/s/ Xxxxxx X. Xxxxxxx
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Xxxxxx X. Xxxxxxx
