Exhibit 99.3
COMPANY STOCK OPTION AGREEMENT
This COMPANY STOCK OPTION AGREEMENT, dated as of November 22, 1998 (the
"Company Stock Option Agreement") is between THE X.X.XXXXXXXX COMPANY, a
corporation formed under the laws of the State of New York ("Parent") and COLTEC
INDUSTRIES INC, a corporation formed under the laws of the Commonwealth of
Pennsylvania (the "Company").
RECITALS
Parent and the Company are entering into an Agreement and Plan of
Merger (the "Merger Agreement"). As a condition and inducement to entering into
the Merger Agreement, the Company and Parent are entering into certain stock
option agreements dated as of the date hereof (of which this Company Stock
Option Agreement is one) pursuant to which the parties grant each other an
option with respect to certain shares of each other's common stock on the terms
and subject to the conditions set forth therein (referred to collectively as the
"Cross Stock Option Agreements").
NOW, THEREFORE, to induce Parent to enter into the Merger Agreement,
and in consideration of the representations, warranties, covenants and
agreements set forth in the Merger Agreement and the Cross Stock Option
Agreements, the parties agree as follows:
1. GRANT OF OPTION.
(a) Subject to the terms and conditions set forth herein, the Company
hereby grants to Parent an irrevocable option (the "Option") to purchase up to
12,550,638 shares, subject to adjustment as provided in Section 11 (the
"Company Shares"), of common stock, $.01 par value per share, of the Company
(the "Company Common Stock ") (being 19.9% of the number of shares of the
Company Common Stock (excluding any shares of Company Common Stock held by a
subsidiary of the Company) outstanding as of November 20, 1998 in the manner set
forth below, at a price per Company Share of $20.125, subject to adjustment as
provided in Section 11 (the "Exercise Price"). The Exercise Price shall be
payable in cash in accordance with Section 4.
(b) Notwithstanding the foregoing, in no event shall the number of the Company
Shares for which the Option is exercisable exceed 19.9% of the number of issued
and outstanding shares of Company Common Stock (excluding any shares of Company
Common Stock held by a subsidiary of the Company).
(c) Capitalized terms used herein but not defined herein shall have the meanings
set forth in the Merger Agreement. "Acquisition Proposal" shall have the meaning
set forth in Section 9.2(b) of the Merger Agreement.
2. EXERCISE OF OPTION.
(a) The Option may be exercised by Parent, in whole, but not in part,
at any time after the Merger Agreement is terminated and the Company has become
obligated to pay the Termination Fee ("Trigger Event").
(b) (i) The Company shall notify Parent promptly in writing of the occurrence of
any Trigger Event, it being understood that the giving of such notice by the
Company shall not be a condition to the right of Parent to exercise the Option.
(ii) In the event Parent wishes to exercise the Option, Parent shall deliver to
the Company written notice thereof (the "Exercise Notice").
(iii) Upon the giving by Parent to the Company of the Exercise Notice and the
tender of the aggregate Exercise Price, Parent, provided that the conditions to
the Company's obligation to issue the Company Shares to Parent hereunder set
forth in Section 3 have been satisfied or waived, shall be deemed to be the
holder of record of the Company Shares issuable upon such exercise,
notwithstanding that the stock transfer books of the Company shall then be
closed or that certificates representing the Company Shares shall not then be
actually delivered to Parent.
(iv) The closing of the purchase of Company Shares (the "Closing") shall occur
at a place, on a date, and at a time designated by Parent in the Exercise Notice
delivered at least two business days prior to the date of the Closing.
(c) The Option shall terminate upon the earliest to occur of:
(i) the Effective Date of the Merger;
(ii) the termination of the Merger Agreement pursuant to Section 9.1 thereof
other than pursuant to (x) Section 9.1(g) thereof, (y) 9.1(j) thereof or (z) if
an Acquisition Proposal with respect to the Company has been publicly disclosed
to the shareholders of the Company (and not withdrawn or terminated) prior to
the Company Meeting, Section 9.1(c) thereof;
(iii) to the extent that (x) an Acquisition Proposal with respect to the Company
has been publicly disclosed to the shareholders of the Company (and not
withdrawn or terminated) prior to the Company Meeting, (y) the Merger Agreement
is terminated pursuant to Section 9.1(c) thereof and (z) the Company does not
enter into any agreement providing for the consummation of an Acquisition
Proposal with respect to the Company (it being understood that no
confidentiality agreement with respect to an Acquisition Proposal shall
constitute such an agreement) and no Acquisition Proposal with respect to the
Company shall have been consummated, in each case, during the twelve month
period following the termination of the Merger Agreement, twelve months after
the date of such termination; and
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(iv) 30 days following a Trigger Event (or if, at the expiration of such 30 day
period, the Option cannot be exercised by reason of any applicable judgment,
decree, order, law or regulation, ten business days after such impediment to
exercise shall have been removed or shall have become final and not subject to
appeal, but in no event under this clause (iv) later than 180 days following
such Trigger Event).
(d) Notwithstanding the foregoing, the Option may not be exercised and shall
terminate if (x) any of the representations and warranties of Parent contained
in this Company Stock Option Agreement or the Merger Agreement, which are
qualified as to materiality, were or shall be inaccurate in any respect, or any
of the representations and warranties of Parent contained herein or therein,
which are not so qualified, were or shall be inaccurate in any material respect,
in each case, (1) when made, (2) as of the date of any termination of the Merger
Agreement and (3) as of the date of any purported exercise of the Option, in the
case of clauses (2) and (3), as if made as of the date of such termination or
purported exercise, respectively (except for representations and warranties that
by their express provisions are made as of a specific date or dates, which shall
only be deemed inaccurate to the extent that they were or shall have been
inaccurate at such times as stated therein), or (y) at the time of termination
of the Merger Agreement or any purported exercise of the Option, Parent is in
material breach of any of its covenants contained in the Merger Agreement or in
this Company Stock Option Agreement.
3. CONDITIONS TO CLOSING. The obligation of the Company to issue the
Company Shares to Parent hereunder is subject to the conditions that:
(a) the waiting periods, if any, applicable to the issuance of the
Company Shares under the HSR Act and the Competition Act (Canada) shall have
expired or been terminated and all other Company Required Consents and Parent
Required Consents in each case relating to this Company Stock Option Agreement
and required to be obtained prior to issuance of the Company Shares shall have
been obtained, except where the failure to obtain such other Company Required
Consents or Parent Required Consents would not have a Material Adverse Effect on
the Company or Parent, as the case may be;
(b) the Company Shares shall have been authorized for listing on the
NYSE upon official notice of issuance; and
(c) no preliminary or permanent injunction or other order by any court
or other Governmental Entity of competent jurisdiction (i) prohibiting or
preventing such issuance or (ii) having any of the effects set forth in Section
8.1(f)(ii) of the Merger Agreement shall have been issued and remain in effect.
The condition set forth in paragraph (b) above may be waived by Parent in its
sole discretion.
4. CLOSING. At the Closing,
(a) The Company shall deliver to Parent a single certificate in
definitive form representing the Company Shares, such certificate to be
registered in the name of Parent and to bear the legend set forth in Section 12;
and
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(b) Parent shall deliver to the Company the aggregate Exercise Price
for the Company Shares by wire transfer of immediately available funds to an
account to be designated in writing by the Company.
(c) The Company shall pay all expenses that may be payable in respect
of the preparation, issuance and delivery of stock certificates under this
Section 4.
5. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company
represents and warrants to Parent that:
(a) the Company has taken all necessary corporate action to authorize
and reserve for issuance and (subject to the satisfaction of the conditions set
forth in Section 3) to permit it to issue, upon exercise of the Option, and, at
all times from the date hereof through the expiration of the Option will have
reserved, authorized and unissued shares of Company Common Stock sufficient for
the exercise of the Option and the Company Shares, upon issuance pursuant
hereto, will be duly and validly issued, fully paid and nonassessable; and
(b) upon delivery of the Company Shares to Parent upon the exercise of
the Option, Parent will acquire the Company Shares free and clear of all claims,
liens, charges, encumbrances and security interests of any nature whatsoever.
6. REPRESENTATIONS AND WARRANTIES OF PARENT. Parent represents and
warrants to the Company that:
(a) any Company Shares acquired by Parent upon exercise of the Option
will be acquired for Parent's own account, for investment purposes only and will
not be, and the Option is not being, acquired by Parent with a view to the
public distribution of the Company Shares, in violation of any applicable
provision of the Securities Act; and
(b) any Company Shares acquired by Parent upon exercise of the Option
will not be transferred or otherwise disposed of except in a transaction
registered, or exempt from registration, under the Securities Act and otherwise
in accordance with this Company Stock Option Agreement.
7. CERTAIN REPURCHASES.
(a) At the request of Parent by written notice (the "Cash-Out Notice")
at any time during which the Option is exercisable pursuant to Section 2, the
Company (or any successor entity thereof) shall, to the extent permitted by
applicable law and subject to the receipt by it of any consent or waiver
required by it under the terms of any indenture, loan document or other
contract, pay to Parent, in consideration of the redelivery and cancellation
without exercise of the Option (in whole and not in part), an amount in cash
(the "Cash-Out Amount") equal to the difference between the "Market/Offer Price"
(as defined below) for shares of the Company Common Stock as of the date Parent
delivers the Cash-Out Notice and the Exercise Price, multiplied by the total
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number of the Company Shares, but only if the Market/Offer Price is greater than
the Exercise Price. For purposes of this Section 7, the "Market/Offer Price"
shall mean, as of any date, the higher of (x) the price per share offered as of
such date pursuant to any tender or exchange offer or other public offer with
respect to the highest Acquisition Proposal with respect to the Company which
was made prior to such date and not terminated or withdrawn as of such date (the
"Offer Price") and (y) Fair Market Value (as defined below) as of such date. As
used herein, "Fair Market Value" shall be the average of the daily closing sales
price for a share of the Company Common Stock on the NYSE during the ten NYSE
trading days prior to the fifth NYSE trading day immediately preceding the date
such Fair Market Value is to be determined. In the event that the consideration
offered pursuant to any Acquisition Proposal includes any consideration other
than cash, such consideration shall be valued as follows for purposes of
calculating the Offer Price: (i) any securities that are either listed on a
national securities exchange (as defined under the Securities Act) or on any
designated offshore securities market (as defined in Regulation S under the
Securities Act) or included in a national securities quotation system (as
defined in the Securities Act) (collectively, "Listed Securities") shall be
valued based on the average of the daily closing sale price of such Listed
Securities for the ten trading days on such national securities exchange,
designated offshore securities market or national securities quotation system
prior to the fifth trading day immediately preceding the date of delivery of the
Cash-Out Notice; and (ii) any consideration other than cash or Listed Securities
shall be valued based on the written opinion of an investment banking firm of
nationally recognized reputation selected by Parent, which firm is reasonably
acceptable to the Company. The costs and fees of such investment banking firm in
connection with such valuation shall be borne equally by Parent and the Company.
(b) In the event Parent exercises its right under this Section 7, the
Company shall, within ten business days thereafter, pay the required amount to
Parent in immediately available funds and Parent shall surrender to the Company
the Option, and Parent shall warrant that it owns the Option and that the Option
is then free and clear of all liens, claims, damages, charges and encumbrances
of any kind or nature whatsoever.
8. VOTING OF SHARES. Following the date hereof and prior to the fifth
anniversary of the date hereof (the "Expiration Date"), Parent shall vote any
shares of capital stock of the Company acquired by Parent pursuant to this
Company Stock Option Agreement or otherwise beneficially owned (within the
meaning of Rule 13d-3 promulgated under the Securities Exchange Act of 1934, as
amended (the "Exchange Act")), by Parent on each matter submitted to a vote of
shareholders of the Company for and against such matter in the same proportion
as the vote of all other shareholders of the Company are voted (whether by proxy
or otherwise) for and against such matter.
9. RESTRICTIONS ON TRANSFER.
(a) The Company Shares shall not be directly or indirectly, by
operation of law or otherwise, sold, assigned, pledged, or otherwise disposed of
or transferred, other than in accordance with Section 9(b) or Section 10.
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(b) Parent shall be permitted to sell, assign, transfer or dispose of
any Company Shares beneficially owned by it if such sale is made (i) pursuant to
a transaction that has been approved or recommended, or otherwise determined to
be fair to and in the best interests of the shareholders of the Company, by a
majority of the members of the Board of Directors of the Company, which majority
shall include a majority of directors who were directors prior to the
announcement of such transaction or (ii) to any purchaser or transferee who
would not, to Parent's knowledge after reasonable inquiry, immediately following
such sale, assignment, transfer or disposal beneficially own more than 1% of the
Company Common Stock on a fully diluted basis (excluding any shares of Company
Common Stock held by a subsidiary of the Company).
10. REGISTRATION RIGHTS.
(a) On or prior to the second anniversary of the exercise of the
Option, Parent may by written notice (the "Registration Notice") to the Company
request the Company to register under the Securities Act all or any part of the
Company Shares beneficially owned by Parent (the "Registrable Securities")
pursuant to a bona fide firm commitment underwritten public offering, in which
Parent and the underwriters shall effect as wide a distribution of such
Registrable Securities as is reasonably practicable and shall use their best
efforts to prevent any person (including any group (as used in Rule 13d-5 under
the Exchange Act)) and its affiliates from purchasing through such offering
Company Shares representing more than 1% of the outstanding shares of Company
Common Stock on a fully diluted basis (excluding any shares of Company Common
Stock held by a subsidiary of the Company) (a "Permitted Offering").
(b) The Registration Notice shall include a certificate executed by
Parent and its proposed managing underwriter, which underwriter shall be an
investment banking firm of nationally recognized standing (the "Manager"),
stating that
(i) they have a good faith intention to commence promptly a Permitted Offering,
and
(ii) the Manager in good faith believes that, based on the then-prevailing
market conditions, it will be able to sell the Registrable Securities at a per
share price equal to at least 80% of the then Fair Market Value of such shares.
(c) The Company (and/or any person designated by the Company) shall
thereupon have the option exercisable by written notice delivered to the Parent
within ten business days after the receipt of the Registration Notice,
irrevocably to agree to purchase all or any part of the Registrable Securities
proposed to be so sold for cash at a price (the "Option Price") equal to the
product of (i) the number of Registrable Securities to be so purchased by the
Company and (ii) the then Fair Market Value of such shares.
(d) Any purchase of Registrable Securities by the Company (or its
designee) under Section 10(c) shall take place at a closing to be held at the
principal executive offices of the Company or at the offices of its counsel at
any reasonable date and time designated by the Company and/or such designee in
such notice within twenty business days after delivery of such notice, and any
payment for the shares to be so purchased shall be made by delivery at the time
of such closing in immediately available funds.
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(e) If the Company does not elect to exercise its option pursuant to
this Section 10 with respect to all Registrable Securities, it shall use its
reasonable efforts to effect, as promptly as reasonably practicable, the
registration under the Securities Act of the unpurchased Registrable Securities
proposed to be so sold; provided, however, that
(i) Parent shall not be entitled to more than an aggregate of two effective
registration statements hereunder, and
(ii) the Company will not be required to file any such registration statement
during any period of time (not to exceed 180 days after such request) when:
(A) the Company is in possession of material non-public information which it
reasonably believes would be detrimental to be disclosed at such time and, in
the opinion of counsel to the Company, such information would have to be
disclosed if a registration statement were filed at that time;
(B) the Company is required under the Securities Act to include audited
financial statements for any period in such registration statement and such
financial statements are not yet available for inclusion in such registration
statement; or
(C) the Company determines, in its reasonable judgment, that such registration
would interfere with any financing, acquisition or other material transaction
involving the Company or any of its affiliates.
(f) The Company shall use its reasonable best efforts to cause any
Registrable Securities registered pursuant to this Section 10 to be qualified
for sale under the securities or Blue Sky laws of such jurisdictions as Parent
may reasonably request and shall continue such registration or qualification in
effect in such jurisdiction; provided, however, that the Company shall not be
required to qualify to do business in, or consent to general service of process
in, any jurisdiction by reason of this provision.
(g) The registration rights set forth in this Section 10 are subject to
the condition that Parent shall provide the Company with such information with
respect to its Registrable Securities, the plans for the distribution thereof,
and such other information with respect to such holder as, in the reasonable
judgment of counsel for the Company, is necessary to enable the Company to
include in such registration statement all material facts required to be
disclosed with respect to a registration thereunder.
(h) A registration effected under this Section 10 shall be effected at
the Company's expense, except for underwriting discounts and commissions and the
fees and the expenses of counsel to Parent, and the Company shall provide to the
underwriters such documentation (including certificates, opinions of counsel and
"comfort" letters from auditors) as is customary in connection with underwritten
public offerings as such underwriters may reasonably require.
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(i) In connection with any registration effected under this Section 10,
the parties agree
(i) to indemnify each other and the underwriters in the customary manner,
(ii) to enter into an underwriting agreement in form and substance customary for
transactions of such type with the Manager and the other underwriters
participating in such offering, and
(iii) to take further reasonable actions which are necessary to effect such
registration and sale.
(j) The Company shall be entitled to include (at its expense)
additional shares of its common stock in a registration effected pursuant to
this Section 10 only if and to the extent the Manager determines that such
inclusion will not adversely affect the prospects for success of such offering.
11. ADJUSTMENT UPON CHANGES IN CAPITALIZATION. Without limitation to
any restriction on the Company contained in this Company Stock Option Agreement
or in the Merger Agreement, in the event of any change in Company Common Stock
by reason of stock dividends, splitups, mergers (other than the Merger),
recapitalizations, combinations, exchange of shares or the like, the type and
number of shares or securities subject to the Option and the Exercise Price
shall be adjusted appropriately and proper provision will be made in the
agreements governing such transaction, so that Parent will receive upon exercise
of the Option the number and class of shares or other securities or property
that Parent would have received in respect of Company Common Stock if the Option
had been exercised immediately prior to such event or the record date therefor,
as applicable. Subject to Section 1, and without limiting the parties' relative
rights and obligations under the Merger Agreement, if any additional shares of
Company Common Stock are issued after the date of this Company Stock Option
Agreement (other than pursuant to an event described in the first sentence of
this Section 11(a)), the number of Company Shares will be adjusted so that,
after such issuance, it equals 19.9% of the number of shares of Company Common
Stock (excluding any shares of Company Common Stock held by a subsidiary of the
Company) then issued and outstanding, without giving effect to any shares
subject to the Option.
12. RESTRICTIVE LEGENDS. Each certificate representing shares of the
Company Common Stock issued to Parent hereunder shall include a legend in
substantially the following form:
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THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE SECURITIES OR BLUE SKY
LAWS, AND MAY BE REOFFERED OR SOLD ONLY IF SO REGISTERED OR IF AN EXEMPTION FROM
SUCH REGISTRATION IS AVAILABLE. SUCH SECURITIES ARE ALSO SUBJECT TO ADDITIONAL
RESTRICTIONS ON TRANSFER AS SET FORTH IN THE COMPANY STOCK OPTION AGREEMENT,
DATED AS OF NOVEMBER 22, 1998, A COPY OF WHICH MAY BE OBTAINED FROM THE ISSUER
UPON REQUEST.
It is understood and agreed that:
(i) the reference to the resale restrictions of the Securities Act and state
securities or Blue Sky laws in the above legend shall be removed by delivery of
substitute certificate(s) without such reference, if Parent shall have delivered
to the Company a copy of a letter from the staff of the Commission, or an
opinion of counsel, in form and substance satisfactory to the Company, to the
effect that such legend is not required for purposes of the Securities Act or
such laws;
(ii) the reference to the provisions to this Company Stock Option Agreement in
the above legend shall be removed by delivery of substitute certificate(s)
without such reference if the shares have been sold or transferred in compliance
with the provisions of this Company Stock Option Agreement and under
circumstances that do not require the retention of such reference; and
(iii) the legend shall be removed in its entirety if the conditions in the
preceding clauses (i) and (ii) are both satisfied.
In addition, such certificates shall bear any other legend as may be required by
law. Certificates representing shares sold in a registered public offering
pursuant to Section 10 shall not be required to bear the legend set forth in
this Section 12.
13. BINDING EFFECT: NO ASSIGNMENT: NO THIRD PARTY BENEFICIARIES. (a)
This Company Stock Option Agreement shall be binding upon and inure solely to
the benefit of each party hereto and their respective successors and permitted
assigns.
(b) Except as expressly provided for in this Company Stock Option
Agreement, neither this Company Stock Option Agreement nor the rights or
obligations of either party hereto are assignable except with the written
consent of the other party.
(c) Nothing contained in this Company Stock Option Agreement, express
or implied, is intended to confer upon any person other than the parties hereto
and their respective permitted assigns any rights or remedies hereunder.
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(d) Any Company Shares sold by Parent in compliance with the provisions
of Section 10 shall, upon consummation of such sale, be free of the restrictions
imposed with respect to such shares by this Company Stock Option Agreement.
14. SPECIFIC PERFORMANCE. The parties hereto agree that irreparable
harm would occur in the event that any of the provisions of this Company Stock
Option Agreement were not performed in accordance with their specified terms or
were otherwise breached. It is accordingly agreed that the parties hereto shall
be entitled to an injunction or injunctions to prevent breaches of this Company
Stock Option Agreement and to enforce specifically the terms and provisions
hereof in any court of the United States or any state having jurisdiction, this
being in addition to any other remedy to which they are entitled at law or in
equity.
15. VALIDITY. (a) The invalidity or unenforceability of any provision
of this Company Stock Option Agreement shall not affect the validity or
enforceability of the other provisions of this Company Stock Option Agreement,
which shall remain in full force and effect.
(b) In the event any court or other competent authority holds any
provision of this Company Stock Option Agreement to be null, void or
unenforceable, the parties hereto shall negotiate in good faith the execution
and delivery of an amendment to this Company Stock Option Agreement in order, as
nearly as possible, to effectuate, to the extent permitted by law, the intent of
the parties hereto with respect to such provision and the economic effects
thereof.
(c) Each party agrees that, should any court or other competent
authority hold any provision of this Company Stock Option Agreement or part
hereof to be null, void or unenforceable, or order any party to take any action
inconsistent herewith, or not take any action required herein, the other party
shall not be entitled to specific performance of such provision or part hereof
or to any other remedy, including but not limited to money damages, for breach
hereof or of any other provision of this Company Stock Option Agreement or part
hereof as the result of such holding or order.
16. NOTICES. All notices and other communications under this Company
Stock Option Agreement shall be in writing and shall be given (and shall be
deemed to have been duly given upon receipt) by delivery in person, if (a)
delivered personally, by overnight courier, telecopy or by registered or
certified mail, postage prepaid, return receipt requested addressed as follows:
A. If to Parent, to:
The X.X.Xxxxxxxx Company
0000 Xxxxxxx Xxxxx Xxxx.
Xxxxxxxxx, XX 00000-0000
Attention: Xxxxxxxx X. Xxxxxxx
Xx. Vice President and General Counsel
Fax: (000) 000-0000
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with a copy to:
Squire, Xxxxxxx & Xxxxxxx L.L.P.
0000 Xxx Xxxxx
000 Xxxxxx Xxxxxx
Xxxxxxxxx, Xxxx 00000-0000
Attention: Xxxxxx X. Xxxxxx, Esq.
Fax: (000) 000-0000
B. If to the Company, to:
Coltec Industries Inc
3 Coliseum Centre
0000 Xxxx Xxxxxx Xxxx
Xxxxxxxxx, XX 00000
Attention: Corporate Secretary
Fax: (000) 000-0000
with a copy to:
Cravath, Swaine & Xxxxx
000 Xxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx X. Xxxxxxx, Xx., Esq. and
Xxxxx Xxxxxxxxx, Esq.
Fax: (000) 000-0000
or to such other address as either party may have furnished to the other party
in writing in accordance with this Section.
17. GOVERNING LAW: CHOICE OF FORUM. This Company Stock Option Agreement
shall be governed in all respects, including validity, interpretation and effect
by and construed in accordance with the laws of the Commonwealth of Pennsylvania
without giving effect to the provisions thereof relating to conflicts of law to
the extent that the application of the laws of another jurisdiction would be
required thereby.
18. INTERPRETATION.
(a) When reference is made in this Company Stock Option Agreement to
Articles, Sections, Schedules or Exhibits, such reference shall be to an
Article, Section, Schedule or Exhibit of this Company Stock Option Agreement, as
the case may be, unless otherwise indicated.
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(b) The headings contained in this Company Stock Option Agreement are
for reference purposes only and shall not affect in any way the meaning or
interpretation of the Company Stock Option Agreement.
(c) Whenever the words "include," "includes," or "including" are used
in this Company Stock Option Agreement and are not followed by the words
"without limitation", they shall be deemed to be followed by the words "without
limitation." The words "hereof", "herein" and "hereunder" and words of similar
import when used in this Company Stock Option Agreement shall refer to this
Company Stock Option Agreement as a whole and not to any particular provision of
this Company Stock Option Agreement.
(d) Whenever "or" is used in this Company Stock Option Agreement it
shall be construed in the nonexclusive sense.
19. COUNTERPARTS; EFFECT. This Company Stock Option Agreement may be
executed in one or more counterparts, each of which shall be deemed to be an
original, but all of which shall constitute one and the same agreement and each
of which shall only become effective when one or more counterparts have been
signed by each party and delivered to the other party.
20. AMENDMENTS; WAIVER. This Company Stock Option Agreement may be
amended by the parties hereto and the terms and conditions hereof may be waived
but, in the case of an amendment, only by an instrument in writing signed on
behalf of each of the parties hereto, or, in the case of a waiver, by an
instrument signed on behalf of the party waiving compliance.
21. LOSS OR MUTILATION. Upon receipt by the Company of evidence
reasonably satisfactory to it of the loss, theft, destruction or mutilation of
this Company Stock Option Agreement, and (in the case of loss, theft or
destruction) of reasonably satisfactory indemnification, and upon surrender and
cancellation of this Company Stock Option Agreement, if mutilated, the Company
will execute and deliver a new Company Stock Option Agreement of like tenor and
date.
IN WITNESS WHEREOF, the parties hereto have caused this Company Stock
Option Agreement to be executed by their respective duly authorized officers as
of the date first above written.
THE X.X.XXXXXXXX COMPANY
By:
Name: Xxxxx X. Burner
Title: Chairman and Chief Executive Officer
COLTEC INDUSTRIES INC
By:
Name: Xxxx X. Xxxxxx, Xx.
Title: Chairman and Chief Executive Officer
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PARENT STOCK OPTION AGREEMENT
This PARENT STOCK OPTION AGREEMENT, dated as of November 22, 1998 (the
"Parent Stock Option Agreement") is between THE X.X.XXXXXXXX COMPANY, a
corporation formed under the laws of the State of New York ("Parent") and COLTEC
INDUSTRIES INC, a corporation formed under the laws of the Commonwealth of
Pennsylvania (the "Company").
RECITALS
Parent and the Company are entering into an Agreement and Plan of
Merger (the "Merger Agreement"). As a condition and inducement to entering into
the Merger Agreement, the Company and Parent are entering into certain stock
option agreements dated as of the date hereof (of which this Parent Stock Option
Agreement is one) pursuant to which the parties grant each other an option with
respect to certain shares of each other's common stock on the terms and subject
to the conditions set forth therein (referred to collectively as the "Cross
Stock Option Agreements").
NOW, THEREFORE, to induce the Company to enter into the Merger
Agreement, and in consideration of the representations, warranties, covenants
and agreements set forth in the Merger Agreement and the Cross Stock Option
Agreements, the parties agree as follows:
1. GRANT OF OPTION.
(a) Subject to the terms and conditions set forth herein, Parent hereby
grants to the Company an irrevocable option (the "Option") to purchase up to
14,792,612 shares, subject to adjustment as provided in Section 11 (the
"Parent Shares"), of common stock, $5 par value per share, of Parent (the
"Parent Common Stock") (being 19.9% of the number of shares of Parent Common
Stock outstanding as of November 18, 1998 in the manner set forth below, at a
price per Parent Share of $35.9375, subject to adjustment as provided in Section
11 (the "Exercise Price"). The Exercise Price shall be payable in cash in
accordance with Section 4.
(b) Notwithstanding the foregoing, in no event shall the number of the Parent
Shares for which the Option is exercisable exceed 19.9% of the number of issued
and outstanding shares of Parent Common Stock.
(c) Capitalized terms used herein but not defined herein shall have the meanings
set forth in the Merger Agreement.
2. EXERCISE OF OPTION.
(a) The Option may be exercised by the Company, in whole, but not in
part, at any time after the Merger Agreement is terminated and Parent has become
obligated to pay the Termination Fee ("Trigger Event").
(b) (i) Parent shall notify the Company promptly in writing of the occurrence of
any Trigger Event, it being understood that the giving of such notice by Parent
shall not be a condition to the right of the Company to exercise the Option.
(ii) In the event the Company wishes to exercise the Option, the Company shall
deliver to Parent written notice thereof (the "Exercise Notice").
(iii) Upon the giving by the Company to Parent of the Exercise Notice and the
tender of the aggregate Exercise Price, the Company, provided that the
conditions to Parent's obligation to issue the Parent Shares to the Company
hereunder set forth in Section 3 have been satisfied or waived, shall be deemed
to be the holder of record of the Parent Shares issuable upon such exercise,
notwithstanding that the stock transfer books of Parent shall then be closed or
that certificates representing the Parent Shares shall not then be actually
delivered to the Company.
(iv) The closing of the purchase of Parent Shares (the "Closing") shall occur at
a place, on a date, and at a time designated by the Company in the Exercise
Notice delivered at least two business days prior to the date of the Closing.
(c) The Option shall terminate upon the earliest to occur of:
(i) the Effective Date of the Merger;
(ii) the termination of the Merger Agreement pursuant to Section 9.1 thereof
other than pursuant to (x) Section 9.1(i) thereof, (y) 9.1(k) thereof or (z) if
an Acquisition Proposal with respect to Parent has been publicly disclosed to
the shareholders of Parent (and not withdrawn or terminated) prior to the Parent
Meeting, Section 9.1(d) thereof;
(iii) to the extent that (x) an Acquisition Proposal with respect to Parent has
been publicly disclosed to the shareholders of Parent (and not withdrawn or
terminated) prior to the Parent Meeting, (y) the Merger Agreement is terminated
pursuant to Section 9.1(d) thereof and (z) Parent does not enter into any
agreement providing for the consummation of an Acquisition Proposal with respect
to Parent (it being understood that no confidentiality agreement with respect to
an Acquisition Proposal shall constitute such an agreement) and no Acquisition
Proposal with respect to Parent shall have been consummated, in each case,
during the twelve month period following the termination of the Merger
Agreement, twelve months after the date of such termination; and
(iv) 30 days following a Trigger Event (or if, at the expiration of such 30 day
period, the Option cannot be exercised by reason of any applicable judgment,
decree, order, law or regulation, ten business days after such impediment to
exercise shall have been removed or shall have become final and not subject to
appeal, but in no event under this clause (iv) later than 180 days following
such Trigger Event).
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(d) Notwithstanding the foregoing, the Option may not be exercised and shall
terminate if (x) any of the representations and warranties of the Company
contained in this Parent Stock Option Agreement or the Merger Agreement, which
are qualified as to materiality, were or shall be inaccurate in any respect, or
any of the representations and warranties of the Company contained herein or
therein, which are not so qualified, were or shall be inaccurate in any material
respect, in each case, (1) when made, (2) as of the date of any termination of
the Merger Agreement and (3) as of the date of any purported exercise of the
Option, in the case of clauses (2) and (3), as if made as of the date of such
termination or purported exercise, respectively (except for representations and
warranties that by their express provisions are made as of a specific date or
dates, which shall only be deemed inaccurate to the extent that they were or
shall have been inaccurate at such times as stated therein), or (y) at the time
of termination of the Merger Agreement or any purported exercise of the Option,
the Company is in material breach of any of its covenants contained in the
Merger Agreement or in this Parent Stock Option Agreement.
3. CONDITIONS TO CLOSING. The obligation of Parent to issue the Parent
Shares to the Company hereunder is subject to the conditions that:
(a) the waiting periods, if any, applicable to the issuance of the
Parent Shares under the HSR Act and the Competition Act (Canada) shall have
expired or been terminated and all other Company Required Consents and the
Parent Required Consents in each case relating to this Parent Stock Option
Agreement and required to be obtained prior to issuance of the Parent Shares
shall have been obtained, except where the failure to obtain such other Company
Required Consents or the Parent Required Consents would not have a Material
Adverse Effect on the Company or Parent, as the case may be;
(b) the Parent Shares shall have been authorized for listing on the
NYSE upon official notice of issuance; and
(c) no preliminary or permanent injunction or other order by any court
or other Governmental Entity of competent jurisdiction (i) prohibiting or
preventing such issuance or (ii) having any of the effects set forth in Section
8.1(f)(ii) of the Merger Agreement shall have been issued and remain in effect.
The condition set forth in paragraph (b) above may be waived by the Company in
its sole discretion.
4. CLOSING. At the Closing,
(a) Parent shall deliver to the Company a single certificate in
definitive form representing the Parent Shares, such certificate to be
registered in the name of the Company and to bear the legend set forth in
Section 12; and
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(b) The Company shall deliver to Parent the aggregate Exercise Price
for the Parent Shares by wire transfer of immediately available funds to an
account to be designated in writing by Parent.
(c) Parent shall pay all expenses that may be payable in respect of the
preparation, issuance and delivery of stock certificates under this Section 4.
5. REPRESENTATIONS AND WARRANTIES OF PARENT. Parent represents and
warrants to the Company that:
(a) Parent has taken all necessary corporate action to authorize and
reserve for issuance and (subject to the satisfaction of the conditions set
forth in Section 3) to permit it to issue, upon exercise of the Option, and, at
all times from the date hereof through the expiration of the Option will have
reserved, authorized and unissued shares of Parent Common Stock sufficient for
the exercise of the Option and the Parent Shares, upon issuance pursuant hereto,
will be duly and validly issued, fully paid and nonassessable; and
(b) upon delivery of the Parent Shares to the Company upon the exercise
of the Option, the Company will acquire the Parent Shares free and clear of all
claims, liens, charges, encumbrances and security interests of any nature
whatsoever.
6. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company
represents and warrants to Parent that:
(a) any Parent Shares acquired by the Company upon exercise of the
Option will be acquired for the Company's own account, for investment purposes
only and will not be, and the Option is not being, acquired by the Company with
a view to the public distribution of the Parent Shares, in violation of any
applicable provision of the Securities Act; and
(b) any Parent Shares acquired by the Company upon exercise of the
Option will not be transferred or otherwise disposed of except in a transaction
registered, or exempt from registration, under the Securities Act and otherwise
in accordance with this Parent Stock Option Agreement.
7. CERTAIN REPURCHASES.
(a) At the request of the Company by written notice (the "Cash-Out
Notice") at any time during which the Option is exercisable pursuant to Section
2, Parent (or any successor entity thereof) shall, to the extent permitted by
applicable law and subject to the receipt by it of any consent or waiver
required by it under the terms of any indenture, loan document or other
contract, pay to the Company, in consideration of the redelivery and
cancellation without exercise of the Option (in whole and not in part), an
amount in cash (the "Cash-Out Amount") equal to the difference between the
"Market/Offer Price" (as defined below) for shares of Parent Common Stock as of
the date the Company delivers the Cash-Out Notice and the Exercise Price,
multiplied by the total number of the Parent Shares, but only if the
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Market/Offer Price is greater than the Exercise Price. For purposes of this
Section 7, the "Market/Offer Price" shall mean, as of any date, the higher of
(x) the price per share offered as of such date pursuant to any tender or
exchange offer or other public offer with respect to the highest Acquisition
Proposal with respect to Parent which was made prior to such date and not
terminated or withdrawn as of such date (the "Offer Price") and (y) Fair Market
Value (as defined below) as of such date. As used herein, "Fair Market Value"
shall be the average of the daily closing sales price for a share of Parent
Common Stock on the NYSE during the ten NYSE trading days prior to the fifth
NYSE trading day immediately preceding the date such Fair Market Value is to be
determined. In the event that the consideration offered pursuant to any
Acquisition Proposal includes any consideration other than cash, such
consideration shall be valued as follows for purposes of calculating the Offer
Price: (i) any securities that are either listed on a national securities
exchange (as defined under the Securities Act) or on any designated offshore
securities market (as defined in Regulation S under the Securities Act) or
included in a national securities quotation system (as defined in the Securities
Act) (collectively, "Listed Securities") shall be valued based on the average of
the daily closing sale price of such Listed Securities for the ten trading days
on such national securities exchange, designated offshore securities market or
national securities quotation system prior to the fifth trading day immediately
preceding the date of delivery of the Cash-Out Notice; and (ii) any
consideration other than cash or Listed Securities shall be valued based on the
written opinion of an investment banking firm of nationally recognized
reputation selected by the Company, which firm is reasonably acceptable to
Parent. The costs and fees of such investment banking firm in connection with
such valuation shall be borne equally by Parent and the Company.
(b) In the event the Company exercises its right under this Section 7,
Parent shall, within ten business days thereafter, pay the required amount to
the Company in immediately available funds and the Company shall surrender to
Parent the Option, and the Company shall warrant that it owns the Option and
that the Option is then free and clear of all liens, claims, damages, charges
and encumbrances of any kind or nature whatsoever.
8. VOTING OF SHARES. Following the date hereof and prior to the fifth
anniversary of the date hereof (the "Expiration Date"), the Company shall vote
any shares of capital stock of Parent acquired by the Company pursuant to this
Parent Stock Option Agreement or otherwise beneficially owned (within the
meaning of Rule 13d-3 promulgated under the Securities Exchange Act of 1934, as
amended (the "Exchange Act")), by the Company on each matter submitted to a vote
of shareholders of Parent for and against such matter in the same proportion as
the vote of all other shareholders of Parent are voted (whether by proxy or
otherwise) for and against such matter.
9. RESTRICTIONS ON TRANSFER.
(a) The Parent Shares shall not be directly or indirectly, by operation
of law or otherwise, sold, assigned, pledged, or otherwise disposed of or
transferred, other than in accordance with Section 9(b) or Section 10.
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(b) The Company shall be permitted to sell, assign, transfer or dispose
of any Parent Shares beneficially owned by it if such sale is made (i) pursuant
to a transaction that has been approved or recommended, or otherwise determined
to be fair to and in the best interests of the shareholders of Parent, by a
majority of the members of the Board of Directors of Parent, which majority
shall include a majority of directors who were directors prior to the
announcement of such transaction or (ii) to any purchaser or transferee who
would not, to the Company's knowledge after reasonable inquiry, immediately
following such sale, assignment, transfer or disposal beneficially own more than
1% of Parent Common Stock on a fully diluted basis.
10. REGISTRATION RIGHTS.
(a) On or prior to the second anniversary of the exercise of the
Option, the Company may by written notice (the "Registration Notice") to Parent
request Parent to register under the Securities Act all or any part of the
Parent Shares beneficially owned by the Company (the "Registrable Securities")
pursuant to a bona fide firm commitment underwritten public offering, in which
the Company and the underwriters shall effect as wide a distribution of such
Registrable Securities as is reasonably practicable and shall use their best
efforts to prevent any person (including any group (as used in Rule 13d-5 under
the Exchange Act)) and its affiliates from purchasing through such offering
Parent Shares representing more than 1% of the outstanding shares of Parent
Common Stock on a fully diluted basis (a "Permitted Offering").
(b) The Registration Notice shall include a certificate executed by the
Company and its proposed managing underwriter, which underwriter shall be an
investment banking firm of nationally recognized standing (the "Manager"),
stating that
(i) they have a good faith intention to commence promptly a Permitted Offering,
and
(ii) the Manager in good faith believes that, based on the then-prevailing
market conditions, it will be able to sell the Registrable Securities at a per
share price equal to at least 80% of the then Fair Market Value of such shares.
(c) Parent (and/or any person designated by the Parent) shall thereupon
have the option exercisable by written notice delivered to the Company within
ten business days after the receipt of the Registration Notice, irrevocably to
agree to purchase all or any part of the Registrable Securities proposed to be
so sold for cash at a price (the "Option Price") equal to the product of (i) the
number of Registrable Securities to be so purchased by Parent and (ii) the then
Fair Market Value of such shares.
(d) Any purchase of Registrable Securities by Parent (or its designee)
under Section 10(c) shall take place at a closing to be held at the principal
executive offices of Parent or at the offices of its counsel at any reasonable
date and time designated by Parent and/or such designee in such notice within
twenty business days after delivery of such notice, and any payment for the
shares to be so purchased shall be made by delivery at the time of such closing
in immediately available funds.
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(e) If Parent does not elect to exercise its option pursuant to this
Section 10 with respect to all Registrable Securities, it shall use its
reasonable efforts to effect, as promptly as reasonably practicable, the
registration under the Securities Act of the unpurchased Registrable Securities
proposed to be so sold; provided, however, that
(i) The Company shall not be entitled to more than an aggregate of two effective
registration statements hereunder, and
(ii) Parent will not be required to file any such registration statement during
any period of time (not to exceed 180 days after such request) when:
(A) Parent is in possession of material non-public information which it
reasonably believes would be detrimental to be disclosed at such time and, in
the opinion of counsel to Parent, such information would have to be disclosed if
a registration statement were filed at that time;
(B) Parent is required under the Securities Act to include audited financial
statements for any period in such registration statement and such financial
statements are not yet available for inclusion in such registration statement;
or
(C) Parent determines, in its reasonable judgment, that such registration would
interfere with any financing, acquisition or other material transaction
involving Parent or any of its affiliates.
(f) Parent shall use its reasonable best efforts to cause any
Registrable Securities registered pursuant to this Section 10 to be qualified
for sale under the securities or Blue Sky laws of such jurisdictions as the
Company may reasonably request and shall continue such registration or
qualification in effect in such jurisdiction; provided, however, that Parent
shall not be required to qualify to do business in, or consent to general
service of process in, any jurisdiction by reason of this provision.
(g) The registration rights set forth in this Section 10 are subject to
the condition that the Company shall provide Parent with such information with
respect to its Registrable Securities, the plans for the distribution thereof,
and such other information with respect to such holder as, in the reasonable
judgment of counsel for Parent, is necessary to enable Parent to include in such
registration statement all material facts required to be disclosed with respect
to a registration thereunder.
(h) A registration effected under this Section 10 shall be effected at
Parent's expense, except for underwriting discounts and commissions and the fees
and the expenses of counsel to the Company, and Parent shall provide to the
underwriters such documentation (including certificates, opinions of counsel and
"comfort" letters from auditors) as is customary in connection with underwritten
public offerings as such underwriters may reasonably require.
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(i) In connection with any registration effected under this Section 10,
the parties agree
(i) to indemnify each other and the underwriters in the customary manner,
(ii) to enter into an underwriting agreement in form and substance customary for
transactions of such type with the Manager and the other underwriters
participating in such offering, and
(iii) to take further reasonable actions which are necessary to effect such
registration and sale.
(j) Parent shall be entitled to include (at its expense) additional
shares of its common stock in a registration effected pursuant to this Section
10 only if and to the extent the Manager determines that such inclusion will not
adversely affect the prospects for success of such offering.
11. ADJUSTMENT UPON CHANGES IN CAPITALIZATION. Without limitation to
any restriction on Parent contained in this Parent Stock Option Agreement or in
the Merger Agreement, in the event of any change in Parent Common Stock by
reason of stock dividends, splitups, mergers (other than the Merger),
recapitalizations, combinations, exchange of shares or the like, the type and
number of shares or securities subject to the Option and the Exercise Price
shall be adjusted appropriately and proper provision will be made in the
agreements governing such transaction, so that the Company will receive upon
exercise of the Option the number and class of shares or other securities or
property that the Company would have received in respect of Parent Common Stock
if the Option had been exercised immediately prior to such event or the record
date therefor, as applicable. Subject to Section 1, and without limiting the
parties' relative rights and obligations under the Merger Agreement, if any
additional shares of Parent Common Stock are issued after the date of this
Parent Stock Option Agreement (other than pursuant to an event described in the
first sentence of this Section 11(a)), the number of Parent Shares will be
adjusted so that, after such issuance, it equals 19.9% of the number of shares
of Parent Common Stock then issued and outstanding, without giving effect to any
shares subject to the Option.
12. RESTRICTIVE LEGENDS. Each certificate representing shares of Parent
Common Stock issued to the Company hereunder shall include a legend in
substantially the following form:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE SECURITIES OR BLUE SKY
LAWS, AND MAY BE REOFFERED OR SOLD ONLY IF SO REGISTERED OR IF AN EXEMPTION FROM
SUCH REGISTRATION IS AVAILABLE. SUCH SECURITIES ARE ALSO SUBJECT TO ADDITIONAL
RESTRICTIONS ON TRANSFER AS SET FORTH IN THE PARENT STOCK OPTION AGREEMENT,
DATED AS OF NOVEMBER 22, 1998, A COPY OF WHICH MAY BE OBTAINED FROM THE ISSUER
UPON REQUEST.
- 8 -
It is understood and agreed that:
(i) the reference to the resale restrictions of the Securities Act and state
securities or Blue Sky laws in the above legend shall be removed by delivery of
substitute certificate(s) without such reference, if the Company shall have
delivered to Parent a copy of a letter from the staff of the Commission, or an
opinion of counsel, in form and substance satisfactory to Parent, to the effect
that such legend is not required for purposes of the Securities Act or such
laws;
(ii) the reference to the provisions to this Parent Stock Option Agreement in
the above legend shall be removed by delivery of substitute certificate(s)
without such reference if the shares have been sold or transferred in compliance
with the provisions of this Parent Stock Option Agreement and under
circumstances that do not require the retention of such reference; and
(iii) the legend shall be removed in its entirety if the conditions in the
preceding clauses (i) and (ii) are both satisfied.
In addition, such certificates shall bear any other legend as may be required by
law. Certificates representing shares sold in a registered public offering
pursuant to Section 10 shall not be required to bear the legend set forth in
this Section 12.
13. BINDING EFFECT: NO ASSIGNMENT: NO THIRD PARTY BENEFICIARIES. (a)
This Parent Stock Option Agreement shall be binding upon and inure solely to the
benefit of each party hereto and their respective successors and permitted
assigns.
(b) Except as expressly provided for in this Parent Stock Option
Agreement, neither this Parent Stock Option Agreement nor the rights or
obligations of either party hereto are assignable except with the written
consent of the other party.
(c) Nothing contained in this Parent Stock Option Agreement, express or
implied, is intended to confer upon any person other than the parties hereto and
their respective permitted assigns any rights or remedies hereunder.
(d) Any Parent Shares sold by the Company in compliance with the
provisions of Section 10 shall, upon consummation of such sale, be free of the
restrictions imposed with respect to such shares by this Parent Stock Option
Agreement.
14. SPECIFIC PERFORMANCE. The parties hereto agree that irreparable
harm would occur in the event that any of the provisions of this Parent Stock
Option Agreement were not performed in accordance with their specified terms or
were otherwise breached. It is accordingly agreed that the parties hereto shall
be entitled to an injunction or injunctions to prevent breaches of this Parent
Stock Option Agreement and to enforce specifically the terms and provisions
hereof in any court of the United States or any state having jurisdiction, this
being in addition to any other remedy to which they are entitled at law or in
equity.
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15. VALIDITY. (a) The invalidity or unenforceability of any provision
of this Parent Stock Option Agreement shall not affect the validity or
enforceability of the other provisions of this Parent Stock Option Agreement,
which shall remain in full force and effect.
(b) In the event any court or other competent authority holds any
provision of this Parent Stock Option Agreement to be null, void or
unenforceable, the parties hereto shall negotiate in good faith the execution
and delivery of an amendment to this Parent Stock Option Agreement in order, as
nearly as possible, to effectuate, to the extent permitted by law, the intent of
the parties hereto with respect to such provision and the economic effects
thereof.
(c) Each party agrees that, should any court or other competent
authority hold any provision of this Parent Stock Option Agreement or part
hereof to be null, void or unenforceable, or order any party to take any action
inconsistent herewith, or not take any action required herein, the other party
shall not be entitled to specific performance of such provision or part hereof
or to any other remedy, including but not limited to money damages, for breach
hereof or of any other provision of this Parent Stock Option Agreement or part
hereof as the result of such holding or order.
16. NOTICES. All notices and other communications under this Parent
Stock Option Agreement shall be in writing and shall be given (and shall be
deemed to have been duly given upon receipt) by delivery in person, if (a)
delivered personally, by overnight courier, telecopy or by registered or
certified mail, postage prepaid, return receipt requested addressed as follows:
A. If to Parent, to:
The X.X.Xxxxxxxx Company
0000 Xxxxxxx Xxxxx Xxxx.
Xxxxxxxxx, XX 00000-0000
Attention: Xxxxxxxx X. Xxxxxxx
Xx. Vice President and General Counsel
Fax: (000) 000-0000
with a copy to:
Squire, Xxxxxxx & Xxxxxxx L.L.P.
0000 Xxx Xxxxx
000 Xxxxxx Xxxxxx
Xxxxxxxxx, Xxxx 00000-0000
Attention: Xxxxxx X. Xxxxxx, Esq.
Fax: (000) 000-0000
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B. If to the Company, to:
Coltec Industries Inc
3 Coliseum Centre
0000 Xxxx Xxxxxx Xxxx
Xxxxxxxxx, XX 00000
Attention: Corporate Secretary
Fax: (000) 000-0000
with a copy to:
Cravath, Swaine & Xxxxx
000 Xxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx X. Xxxxxxx, Xx., Esq. and
Xxxxx Xxxxxxxxx, Esq.
Fax: (000) 000-0000
or to such other address as either party may have furnished to the other party
in writing in accordance with this Section.
17. GOVERNING LAW: CHOICE OF FORUM. This Parent Stock Option Agreement
shall be governed in all respects, including validity, interpretation and effect
by and construed in accordance with the laws of the Commonwealth of Pennsylvania
without giving effect to the provisions thereof relating to conflicts of law to
the extent that the application of the laws of another jurisdiction would be
required thereby.
18. INTERPRETATION.
(a) When reference is made in this Parent Stock Option Agreement to
Articles, Sections, Schedules or Exhibits, such reference shall be to an
Article, Section, Schedule or Exhibit of this Parent Stock Option Agreement, as
the case may be, unless otherwise indicated.
(b) The headings contained in this Parent Stock Option Agreement are
for reference purposes only and shall not affect in any way the meaning or
interpretation of the Parent Stock Option Agreement.
(c) Whenever the words "include," "includes," or "including" are used
in this Parent Stock Option Agreement and are not followed by the words "without
limitation", they shall be deemed to be followed by the words "without
limitation." The words "hereof", "herein" and "hereunder" and words of similar
import when used in this Parent Stock Option Agreement shall refer to this
Parent Stock Option Agreement as a whole and not to any particular provision of
this Parent Stock Option Agreement.
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(d) Whenever "or" is used in this Parent Stock Option Agreement it
shall be construed in the nonexclusive sense.
19. COUNTERPARTS; EFFECT. This Parent Stock Option Agreement may be
executed in one or more counterparts, each of which shall be deemed to be an
original, but all of which shall constitute one and the same agreement and each
of which shall only become effective when one or more counterparts have been
signed by each party and delivered to the other party.
20. AMENDMENTS; WAIVER. This Parent Stock Option Agreement may be
amended by the parties hereto and the terms and conditions hereof may be waived
but, in the case of an amendment, only by an instrument in writing signed on
behalf of each of the parties hereto, or, in the case of a waiver, by an
instrument signed on behalf of the party waiving compliance.
21. LOSS OR MUTILATION. Upon receipt b y Parent of evidence reasonably
satisfactory to it of the loss, theft, destruction or mutilation of this Parent
Stock Option Agreement, and (in the case of loss, theft or destruction) of
reasonably satisfactory indemnification, and upon surrender and cancellation of
this Parent Stock Option Agreement, if mutilated, Parent will execute and
deliver a new Parent Stock Option Agreement of like tenor and date.
IN WITNESS WHEREOF, the parties hereto have caused this Parent Stock
Option Agreement to be executed by their respective duly authorized officers as
of the date first above written.
THE X.X.XXXXXXXX COMPANY
By:
Name: Xxxxx X. Burner
Title: Chairman and Chief Executive Officer
COLTEC INDUSTRIES INC
By:
Name: Xxxx X. Xxxxxx, Xx.
Title: Chairman and Chief Executive Officer
- 12 -
