Exhibit 10.13
October 1, 1997
Xx. Xxxx Xxxxxxx
000 Xxxxxxx Xxxxxx
Xxxxx 000
Xxx Xxxx, Xxx Xxxx 00000
Standstill Agreement
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Dear Xx. Xxxxxxx:
This letter agreement sets forth the terms of our
agreement with respect to any direct and/or indirect ownership or
acquisition by you, Xxxx Xxxxxxx ("Xxxxxxx"), of any Voting
Securities (as defined below) of American Electromedics Corp., a
Delaware corporation (the "Company"). The Company and you
acknowledge, respectively, that the consideration for entering
into and delivering this letter agreement is your sale of 500,000
shares of the Company's Common Stock to some investors and the
issuance and delivery by the Company to you of a General Release
simultaneous with such sale.
For the purposes of this letter agreement, the
following definitions shall apply: "Common Stock" means the
Common Stock, par value $.10 per share of the Company or any
securities of the Company issued in substitution thereof;
"affiliate" of a person means a person that directly or
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indirectly through one or more intermediaries, controls, is
controlled by, or is under common control with such person and,
to the extent not otherwise within this definition, a member of
such person's immediate family; "control" means the power to
direct or cause the direction of the management or policies of a
person whether through ownership of securities, by contract or
otherwise; "person" means and includes an individual, a
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partnership; a joint venture, a corporation, a group, a trust, an
estate, an unincorporated organization or association, and any
"person" within the meaning of Section 13(d)(3) of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"); "immediate
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family" of a person means a son or daughter of such person or a
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descendent of either, a stepson or stepdaughter of such person,
the father or mother of such person or an ancestor of either, a
stepfather or stepmother of such person or a spouse of such
person; for the purpose of determining whether any of the
foregoing relations exists, a legally adopted child of a person
shall be considered a child of such person by blood; and "Voting
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Securities" includes the Common Stock, and any other securities
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of the Company entitled to vote generally for the election of
directors or any securities having the right to convert into such
securities or any option or rights to acquire any of the
foregoing, now or hereafter outstanding.
1. Xxxxxxx covenants and agrees with the Company that
he will not in his name, nor will he permit any affiliate over
which he exercises control (including but not limited to The
Alden Foundation and Xxxx Xxxxxxx Co. Defined Contribution
Pension Plan), without the prior consent of the Company's Board
of Directors specifically expressed in a resolution adopted by a
majority of the directors of the Company, for a period of two (2)
years following the date of this letter agreement (the "Agreement
Term") to:
(a) Own or acquire or offer to acquire, directly
or indirectly, of record or beneficially, by
purchase or otherwise, any Voting Securities in
aggregate amount at any time exceeding the greater
of (I) 150,000 shares of Common Stock (as the
shares are presently constituted) or (II) two (2%)
percent of the issued and outstanding shares of
Common Stock (excluding treasury shares); or
(b) Seek representation on the Board of Directors of
the Company or solicit proxies with respect to Voting
Securities under any circumstances; submit proposals
for the vote of stockholders of the Company; or become
a "participant" in any "election contest" relating to
the election of directors of the Company (as such terms
are used on the date hereof in Rule 14a-11 of
Regulation 14A under the Exchange Act); or
(c) Enter into any joint venture, partnership, voting
arrangement or other understanding or otherwise act in
concert with any other person for the purpose of
acquiring, holding or voting of any Voting Securities;
(d) Take any action (or permit any investment banker,
attorney, accountant or any other representative
retained by him to take any action a part of such
retention), directly or indirectly, to acquire or
affect a change of control of the Company or initiate
contact with any person or entity in an effort to
solicit, encourage or assist such person or entity in a
takeover proposal. As used in this paragraph,
"takeover proposal" shall mean any proposal for a
merger or other business combination involving the
Company or for the acquisition of a substantial equity
interest in the Company or a substantial portion of the
Company's assets.
2. Xxxxxxx acknowledges and agrees that the Company
would be irreparably damaged in the event any of the provisions
of this letter agreement were not performed by him in accordance
with their specific terms or were otherwise breached. It is
accordingly agreed that the Company shall be entitled to an
injunction or injunctions to redress breaches of this letter
agreement and to specifically enforce the terms and provisions
hereof in any state thereof having subject matter jurisdiction,
in addition to any other remedy to which such party may be
entitled, at law or in equity.
3. This letter agreement sets forth the entire
agreement between us with respect to the subject matter herein,
and cannot be amended, modified or terminated except by an
agreement in writing executed by both of us.
4. This letter agreement shall be construed and
enforced in accordance with the laws of the State of Delaware.
If the foregoing correctly sets forth our agreement,
kindly sign and return to us the enclose copy of this letter
agreement.
American Electromedics Corp.
By: /s/ Xxxxxxx X. Xxxxxxxxx
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Agreed to:
/s/ Xxxx Xxxxxxx
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Xxxx Xxxxxxx
