EXHIBIT 10.14
EXECUTION COPY
STOCK REPURCHASE AGREEMENT
THIS AGREEMENT is made and entered this 9th day of November, 2001, by
and between Xxxxxx X. Xxxxxxxx ("Shareholder") and Young Innovations, Inc., a
Missouri corporation (the "Company").
WHEREAS, Shareholder, members of Shareholder's family and trusts held
for the benefit of Shareholder or his family are the record and beneficial owner
of all right, title and interest in and to an aggregate of 3,925,206 shares of
the issued and outstanding common stock of the Company, $0.01 par value per
share (stock owned by Shareholder is referred to as the "Shareholder Common
Stock");
WHEREAS, the Company desires to reduce the concentrated ownership by
Shareholder in order that (i) ownership of the Company's Common Stock is more
distributed and (ii) Shareholder will no longer possess sufficient voting power
to control the Company unilaterally or together with members of Shareholder's
family or trusts holding shares for the benefit thereof; and
WHEREAS, the Board of Directors of the Company has approved the
repurchase of seven hundred thousand (700,000) shares of the Shareholder Common
Stock (the "Repurchased Shares") in exchange for the Purchase Price in
accordance with and subject to the terms and conditions set forth herein;
NOW, THEREFORE, in consideration of the representations, warranties,
covenants and agreements contained herein, the parties agree as follows:
1. REDEMPTION AND EXCHANGE OF STOCK. At the Closing (as hereinafter
defined), (i) Shareholder shall or shall cause The Xxxxxx X. Xxxxxxxx Revocable
Living Trust, as amended (the "Trust") to surrender for repurchase by transfer
to the Company, and the Company shall repurchase and accept all right, title and
interest in the Repurchased Shares and (ii) as consideration for such
repurchase, the Company shall transfer, assign and deliver to Shareholder, and
Shareholder shall accept cash in the amount of $14,700,000 (the "Purchase
Price").
2. THE CLOSING AND TRANSFER OF STOCK.
2.1. CLOSING. The repurchase of stock contemplated by this Agreement
(the "Closing") shall occur on November 9, 2001 at such time or place as may be
mutually agreed upon by the parties (the "Closing Date"). Upon consummation, the
Closing shall be deemed to take place as of the close of business on the Closing
Date.
2.2. DELIVERIES BY THE SHAREHOLDER. At the Closing, Shareholder shall
deliver or cause to be delivered the following:
(a) certificates evidencing all of the Repurchased Shares with fully
executed stock powers; and
(b) such other instruments or documents as may be reasonably
necessary to carry out the transactions contemplated by this Agreement and
to comply with the terms hereof.
2.3. DELIVERIES BY THE COMPANY. At the Closing, the Company shall
deliver or cause to be delivered the following:
(a) the Purchase Price by wire transfer in accordance with the
instructions set forth on Schedule A attached hereto; and
(b) such other instruments or documents as may be reasonably
necessary to carry out the transactions contemplated by this Agreement and
to comply with the terms hereof.
3. REPRESENTATIONS AND WARRANTIES OF SHAREHOLDER. Shareholder hereby
represents and warrants to the Company as of the date hereof, and as of the
Closing, as follows:
3.1. AUTHORITY. Each of Shareholder and the Trust has full legal
right, power, capacity and authority, without the consent of any other person,
to execute and deliver this Agreement, and to carry out the transactions
contemplated hereby. All actions required to be taken by Shareholder and the
Trust to authorize the execution, delivery and performance of this Agreement and
all transactions contemplated hereby (including any consultation, approval or
other action by or with any other person) have been duly and properly taken. The
execution, delivery and performance by each of the Shareholder and the Trust of
this Agreement and the consummation of the transactions contemplated hereby (i)
require no action by or in respect of, or filing with, any governmental entity,
and (ii) do not and will not contravene or constitute a default, violation or
breach under, or give rise to, a right of termination, cancellation or
acceleration of any right or obligation of Shareholder or the Trust or to a loss
of any benefit of Shareholder or the Trust under, any provision of applicable
law or regulation or any agreement, judgment, injunction, indenture, deed of
trust, order, decree, or other instrument binding on Shareholder or the Trust or
any of their respective properties or result in the imposition of any Lien (as
hereinafter defined) on the Repurchased Shares. The Repurchased Shares do not
constitute community property and are not otherwise owned or held in a manner
that requires spousal or other approval for this Agreement to be legal, valid
and binding.
3.2. VALIDITY. This Agreement has been duly executed and delivered and
is the lawful, valid and legally binding obligation of each of Shareholder and
the Trust, enforceable in accordance with its terms.
3.3. OWNERSHIP OF REPURCHASED SHARES. As of the date hereof, the Trust
is, and at the Closing shall be, the sole record, legal and beneficial owner of
the Repurchased Shares, and the Trust has good, valid and marketable title to
the Repurchased Shares registered in its name and the absolute right, power and
capacity to sell, assign, transfer and deliver the same to the Company free and
clear of any liens, encumbrances, pledges, security interests, restrictive
agreements, transfer restrictions, voting trust arrangements, claims and
imperfections of any nature whatsoever (collectively, "Lien"). None of the
Repurchased Shares is subject to any voting trust or other agreement,
arrangement or restriction with respect to the voting of such
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Repurchased Shares. Upon delivery of the certificates for the Repurchased Shares
to the Company, the Company will have good, valid and marketable title to such
shares free and clear of all Liens.
3.4. SUBSEQUENT TRANSFERS. Shareholder will cause the transfer of a
portion of Shareholder Common Stock in accordance with Section 4.1 hereof.
4. OTHER PROVISIONS.
4.1. Shareholder agrees that on or before May 8, 2003, he will
transfer 435,000 shares of the Shareholder's Common Stock (appropriately
adjusted for stock splits, stock dividends or similar events) (the "Required
Number of Shares") to (a) a charitable remainder trust (within the meaning of
Section 664 of the Internal Revenue of Code 1986, as amended (the "Code") or
charity described in Section 501(c)(3) of the Code, and/or (b) an unaffiliated
third party, in each case, to a transferee whose ownership of such shares would
not in whole or in part, be attributed to Shareholder under Section 318 of the
Internal Revenue Code of 1986, as amended (the "Code") and who is neither
controlled by, nor substantially under the controlling influence of, Shareholder
(individually, a "Permitted Transferee"; collectively, the "Permitted
Transferees"). If Shareholder does not dispose of the Required Number of Shares
by May 8, 2003, Shareholder agrees that Company will on such date: (a) cause
Shareholder to transfer ninety-five percent (95%) of Required Number of Shares
which have not been transferred to one or more Permitted Transferees in
accordance with this Section 4.1 to one or more charities described in Section
501(c)(3) of the Code chosen by Company which charities are based in Missouri
and are a Permitted Transferee; and (b) purchase five percent (5%) of the
Required Number of Shares which have not been transferred to one or more
Permitted Transferees in accordance with this Section 4.1 for aggregate
consideration of $1.00, with the closing of such share purchase to occur
immediately after the transfer to the charity. For purposes of this Section 4.1,
Shareholder's obligation to transfer shares shall be satisfied to the extent
that shares currently owned by his family members that are attributable to
Shareholder under Section 318 of the Code are transferred to one or more
Permitted Transferees and are not subsequently treated as owned by Shareholder
under Section 318 of the Code.
4.2. AMENDMENT, WAIVER AND ENFORCEMENT. No amendment or waiver of or
consent to any provision of this Agreement shall in any event be effective,
unless the same shall be in writing and signed by the parties hereto, and then
such amendment, waiver or consent shall be effective only in the specific
instance and for the specific purpose for which given. If Shareholder breaches
Section 4.1 of this Agreement, Shareholder agrees that (a) the Company shall be
entitled to enforce Section 4.1 by specific performance, and (b) in connection
with the Company's enforcement of Section 4.1, Shareholder will not contest the
assertion, if any, by the Company that monetary damages do not provide an
adequate remedy.
4.3. NOTICES. All notices, requests, demands and other communications
hereunder shall be in writing.
4.4. COUNTERPARTS. This Agreement may be executed simultaneously in
two or more counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same Agreement.
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4.5. PARTIES IN INTEREST. This Agreement shall bind and inure to the
benefit of the parties named herein and their respective heirs, successors and
assigns.
4.6. ENTIRE TRANSACTION. This Agreement and the documents referred to
herein contain the entire understanding among the parties with respect to the
transactions contemplated hereby and supersede all other agreements and
understandings among the parties.
4.7. APPLICABLE LAW. This Agreement shall be governed by and construed
in accordance with the internal substantive laws of the State of Missouri.
4.8. HEADINGS. The section and other headings contained in this
Agreement are for reference purposes only and shall not affect in any way the
meaning or interpretation of this Agreement.
IN WITNESS WHEREOF, each of the parties has caused this Agreement to
be duly executed all as of the date first written above.
YOUNG INNOVATIONS, INC.
By: /s/ Xxxxxx X. Xxxxxx, Xx. /s/ Xxxxxx X. Xxxxxxxx
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Name: Xxxxxx X. Xxxxxx, Xx. Xxxxxx X. Xxxxxxxx
Title: Vice President Strategic
Planning and Chief
Financial Officer
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