EXHIBIT 2
EXCHANGE AGREEMENT
THIS EXCHANGE AGREEMENT (the "Agreement") is executed and
entered into effective as of March 12, 2003, by and among (i) X.X. Xxxxxxxx
Trusts LLC, a Delaware limited liability company (the "LLC"), (ii) Xxxxxxx X.
Xxxxx ("Xxxxxxx Xxxxx"), (iii) Xxxxx Xxxxx Wiley ("Xxxxx Xxxxx"), (iv) Xxxxxxxx
Xxxxx XX ("Xxxxxxxx Xxxxx"), and (v) X. Xxxxxxxx Wiley Associates, L.P., a New
Jersey limited partnership (the "Partnership").
RECITALS
WHEREAS, the parties to this Agreement own approximately 20
percent of the total outstanding shares of capital stock of Xxxx Xxxxx & Sons,
Inc. (the "Company") and control approximately 50 percent of the voting power of
the Company;
WHEREAS, the LLC was established for the purpose of
maintaining family ownership and control of the Company by owning, investing in,
administering and managing shares of the Company's Class A common stock, par
value $1.00 per share (the "Class A Stock") and shares of the Company's Class B
common stock, par value $1.00 per share (the "Class B Stock," and together with
the Class A Stock, the "Shares"); and
WHEREAS, it is the intent of the parties that the LLC shall
become the holder of record of all of the Class B Stock currently held by
Xxxxxxx Xxxxx, Xxxxx Xxxxx, Xxxxxxxx Xxxxx and the Partnership.
AGREEMENT
NOW, THEREFORE, for and in consideration of the mutual
covenants and agreements contained herein, the parties hereto do hereby agree as
follows:
SECTION I
EXCHANGE OF SHARES
1.1 Exchange of Class A Stock for Class B Stock. Each of
Xxxxxxx Xxxxx, Xxxxx Xxxxx, Xxxxxxxx Xxxxx and the Partnership (collectively,
the "Family Holders") hereby agrees to transfer to the LLC all of his, her or
its shares of Class B Stock as set forth below opposite their respective names
solely in exchange for the number of shares of Class A Stock as set forth below
opposite their respective names. For the purposes of this exchange, each share
of Class B Stock shall equal .961184 shares of Class A Stock based on the
appraisal of Management Planning, Inc., dated March 12, 2003.
Shares of Class B Stock Shares of Class A Stock
Family Holder Transferred to LLC Received from LLC
------------- ------------------ ----------------
Xxxxxxx Xxxxx 645,472 654,068
Xxxxx Xxxxx 608,544 616,649
Xxxxxxxx Xxxxx 608,544 616,649
Partnership 297,680 301,644
--------- ---------
Total 2,160,240 2,189,010
1.2 The Closing. The closing (the "Closing") of the
transactions contemplated by this Agreement shall take place on the date hereof
at the offices of the Company, or on such other date, time or place as may be
agreed upon in writing by the parties hereto. The date of the Closing is herein
referred to as the Closing Date.
1.3 Closing Deliveries. In connection with the Closing each
Family Holder shall deliver to the LLC certificates representing the shares of
Class B Stock to be transferred by each, duly endorsed to the LLC, or with stock
powers attached, duly endorsed to the LLC. The LLC shall deliver to each Family
Holder certificates representing the shares of Class A Stock to be transferred
to each such Family Holder, duly endorsed to each such Family Holder, or with
stock powers attached, duly endorsed to each such Family Holder.
1.4 Transfer Taxes. The LLC shall bear the cost of
documentary, stamp, sales, excise or other taxes payable in respect of the
transfer of the Shares, if any.
SECTION II
REPRESENTATIONS AND WARRANTIES
2.1 As a material inducement to the LLC to exchange the
Shares, each Family Holder represents and warrants to the LLC as follows:
(a) Legal Age; Legally Competent. Each of Xxxxxxx
Xxxxx, Xxxxx Xxxxx and Xxxxxxxx Xxxxx is of legal
age to execute and perform this Agreement and is legally competent to do so.
(b) Due Authorization, Enforceability, No Conflicts.
The Partnership has taken all action necessary to authorize the execution,
deliver and performance by it of this Agreement and the consummation of the
transactions contemplated hereby. This Agreement constitutes a valid and binding
obligation of each Family Holder, enforceable against him, her or it in
accordance with its terms, subject to applicable bankruptcy, insolvency,
reorganization, moratorium and similar laws of general application relating to
or affecting enforcement of creditors' rights generally and general principles
of equity. The execution, delivery and performance by each Family
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Holder of this Agreement will not violate, conflict with or cause any breach of
the terms of any law, rule, regulation, order, writ, injunction or decree to
which he, she or it is subject, or any agreement or instrument to which such
Family Holder is a party or by which such Family Holder may be bound.
(c) Consents. No consent, approval or authorization
of, or exemption by, or registration or filing with, any governmental or
regulatory authority or other third party which has not been obtained or made by
any Family Holder on or before the date hereof is required in connection with
the execution and delivery by him, her or it of this Agreement or the
consummation by him, her or it of the transactions contemplated hereby.
(d) Title. Each Family Holder has full legal and
beneficial title to the shares of Class B Stock attributed to him, her or it,
and, upon transfer to the LLC, the LLC will have full legal and beneficial title
thereto free and clear of all liens, encumbrances or other interests of third
parties.
2.2 As a material inducement to each of the Family Holders to
exchange the Shares, the LLC represents and warrants to each Family Holder as
follows:
(a) Due Authorization, Enforceability, No Conflicts.
The LLC has taken all action necessary to authorize the execution, deliver and
performance by it of this Agreement and the consummation of the transactions
contemplated hereby. This Agreement constitutes a valid and binding obligation
of the LLC, enforceable against it in accordance with its terms, subject to
applicable bankruptcy, insolvency, reorganization, moratorium and similar laws
of general application relating to or affecting enforcement of creditors' rights
generally and general principles of equity. The execution, delivery and
performance by the LLC of this Agreement will not violate, conflict with or
cause any breach of the terms of any law, rule, regulation, order, writ,
injunction or decree to which it is subject, or any agreement or instrument to
which the LLC is a party or by which it may be bound.
(b) Consents. No consent, approval or authorization
of, or exemption by, or registration or filing with, any governmental or
regulatory authority or other third party which has not been obtained or made by
the LLC on or before the date hereof is required in connection with the
execution and delivery by it of this Agreement or the consummation by it of the
transactions contemplated hereby.
(c) Title. The LLC has full legal and beneficial
title to the shares of Class A Stock attributed to it, and, upon transfer to the
Family Holders, each Family Holder will have full legal and beneficial title to
the Shares received free and clear of all liens, encumbrances or other interests
of third parties.
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SECTION III
MISCELLANEOUS
3.1 Entire Agreement. This Agreement sets forth the entire
agreement of the parties hereto with respect to the subject matter hereof and
supersedes all prior agreements between them, whether written or oral, with
respect to the subject matter hereof.
3.2 Survival of Representations and Warranties. The respective
representations and warranties of the Family Holders and the LLC, contained in
this Agreement shall survive the exchange of the Shares, contemplated hereby.
3.3 Amendment and Waiver. This Agreement may not be amended
nor may any of the provisions hereof be waived orally. To be effective, any
amendment to this Agreement shall be in writing and signed by all of the parties
hereto. To be effective, any waiver of any of the provisions of this Agreement
shall be in writing and signed by the party to be charged and then such waiver
shall be effective only to the extent specifically set forth in such writing.
3.4 Notices. All notices, consents, waivers or other
communications required or permitted to be given or made pursuant to any of the
provisions of this Agreement shall be in writing and shall be deemed to have
been duly given or made for all purposes if sent by certified or registered
mail, return receipt requested, and postage prepaid, hand delivered, sent by
confirmed telecopy or other confirmed electronic means or by express mail
service or other nationally recognized overnight courier service to the party at
its or his or her address.
3.5 Governing Law. This Agreement and the rights and
obligations of the parties hereunder shall be governed by, construed and
enforced in accordance with the laws of the State of New York without reference
to the choice of law provisions thereof.
3.6 Binding Effect. This Agreement shall be binding upon and
shall inure to the benefit of the parties hereto and their respective
successors.
3.7 Severability. If any provision of this Agreement is held
to be prohibited by or invalid under applicable law in any jurisdiction, such
provision shall be ineffective only to the extent of such prohibition or
invalidity, without invalidating any other provisions of this Agreement.
3.8 Counterparts. This Agreement may be executed in one or
more counterparts, each of which when so executed and delivered shall be an
original, but all of which together shall constitute one and the same
instrument.
3.9 Headings. The headings in this Agreement are inserted for
convenience of reference only and shall not affect the interpretation of this
Agreement.
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IN WITNESS WHEREOF, the parties have executed and delivered
this Agreement as of the day and year first above written.
X.X. XXXXXXXX TRUSTS LLC
By: /s/ Xxxxxxx X. Xxxxx
----------------------------
Name: Xxxxxxx X. Xxxxx
Title: Manager
/s/ Xxxxxxx X. Xxxxx
----------------------------
Xxxxxxx X. Xxxxx
/s/ Xxxxx Xxxxx Xxxxx
----------------------------
Xxxxx Xxxxx Wiley
/s/ Xxxxxxxx Xxxxx XX
----------------------------
Xxxxxxxx Xxxxx XX
X. XXXXXXXX XXXXX ASSOCIATES, L.P.
By: /s/ Xxxxxxx X. Xxxxx
----------------------------
Name: Xxxxxxx X. Xxxxx
Title: General Partner
By: /s/ Xxxxx Xxxxx Wiley
----------------------------
Name: Xxxxx Xxxxx Xxxxx
Title: General Partner
By: /s/ Xxxxxxxx Xxxxx XX
----------------------------
Name: Xxxxxxxx Xxxxx XX
Title: General Partner
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