Daniel H. Leever c/o MacDermid, Incorporated 1401 Blake Street Denver, Colorado 80202
Exhibit 7e
Xxxxxx X. Xxxxxx
c/x XxxXxxxxx, Incorporated
0000 Xxxxx Xxxxxx
Xxxxxx, Xxxxxxxx 00000
c/x XxxXxxxxx, Incorporated
0000 Xxxxx Xxxxxx
Xxxxxx, Xxxxxxxx 00000
December 15, 2006
To:
|
MDI Holdings, LLC | |
| The Other Investors Listed on Schedule B | ||
Re:
|
Acquisition of MacDermid, Incorporated |
Ladies and Gentlemen:
Reference is made to the Agreement and Plan of Merger, dated as of the date hereof (the
“Merger Agreement”), by and among MDI Holdings, LLC, a Delaware limited liability company
(“Parent”), Matrix Acquisition Corp., a Connecticut corporation (“Merger Sub”) and
MacDermid, Incorporated, a Connecticut corporation (the “Company”), and pursuant to which
Merger Sub, or its permitted assignees, will be merged with and into the Company (the
“Merger”). Capitalized terms used but not defined herein have the meanings ascribed to
them in the Merger Agreement. This letter is being delivered to the addressees in connection with
the execution of the Merger Agreement by Parent, Merger Sub and the Company.
The undersigned hereby commits, subject to the conditions set forth herein, to subscribe for
preferred units and common units of Parent (“Subscribed Units”) for aggregate consideration
consisting of (i) the number of shares of Company Common Stock set forth on Schedule A (the
“Committed Shares”) and (ii) proceeds from the Merger with an aggregate value as set forth
on Schedule A (the “Committed Proceeds”), provided that the undersigned shall not, under
any circumstances, be obligated to contribute to, purchase equity or debt of or otherwise provide
funds to Parent other than the contribution of the Committed Shares and Committed Proceeds. The
value of the Committed Shares and Committed Proceeds shall be used to purchase the Subscribed Units
at the same per unit price and in the same proportions as the Guarantors are acquiring units. The
obligation of the undersigned to fund the Committed Shares and Committed Proceeds (the
“Commitment”) is subject to (a) the terms of this letter, and (b) the substantially
concurrent consummation of the Merger in accordance with the terms of the Merger Agreement and
without waiver of any condition or amendment of the Merger Agreement that, in either case, is not
consented to in writing by (1) the undersigned or (2) Court Square Capital Partners L.P.
(“CSC”).
This letter, and the undersigned’s obligation to fund the Commitment, will terminate
automatically and immediately upon the earliest to occur of (a) the Effective Time (but only if
Parent’s obligation pursuant to Section 2.2(a) of the Merger Agreement shall have been performed in
full) and (b) termination of the Merger Agreement.
The undersigned represents and warrants to Parent that: (i) the undersigned has the requisite
capacity and authority to execute and deliver this letter and to fulfill and perform the
undersigned’s obligations hereunder; (ii) this letter has been duly and validly executed and
delivered by the undersigned and constitutes a legal, valid and binding agreement of the
undersigned enforceable by the addressees against the undersigned in accordance with its terms;
(iii) the undersigned is the record and beneficial
owner of the Committed Shares, free and clear of any lien or encumbrance (other than those
arising under this letter) and has full and unrestricted power to dispose of all of such Committed
Shares as contemplated by this letter without the consent or approval of, or any other action on
the part of, any other Person; (iv) other than the filing by the undersigned of any reports with
the SEC required by Sections 13(d) or 16(a) of the Exchange Act, none of the execution and delivery
of this letter by the undersigned, the consummation by the undersigned of the transactions
contemplated hereby or compliance by the undersigned with any of the provisions hereof (1) requires
any consent or other permit of, or filing with or notification to, any Governmental Entity or any
other Person by the undersigned, (2) results in a violation or breach of, or constitutes (with or
without notice or lapse of time or both) a default (or gives rise to any third party right of
termination, cancellation, material modification or acceleration) under any of the terms,
conditions or provisions of any organizational document or contract to which the undersigned is a
party or by which the undersigned or any of the Committed Shares may be bound or affected, (3)
violates any law or order or judgment of any governmental authority applicable to the undersigned
or the Committed Shares, or (4) results in a lien or encumbrance upon any of the Committed Shares;
and (v) the undersigned has not entered into any share disposition, commitment or other agreement
or arrangement that is inconsistent with this letter (including the Commitment). The undersigned
covenants and agrees that from and after the date hereof and for so long as this letter remains in
effect, the undersigned shall not take or omit to take any action that would or would cause or
result in any of the foregoing representations and warranties to become untrue.
The rights and obligations under this letter may not be assigned by any party hereto without
the prior written consent of Parent and CSC, and any attempted assignment shall be null and void
and of no force or effect. This letter may not be amended, and no provision hereof waived or
modified, except by an instrument in writing signed by Parent and the undersigned and approved in
writing by CSC.
This letter shall be binding on the undersigned solely for the benefit of the addressees, and
nothing set forth in this letter shall be construed to confer upon or give to any person other than
the addressees any benefits, rights or remedies under or by reason of, or any rights to enforce or
cause such addressee to enforce, the Commitment or any provisions of this letter.
This letter may only be enforced by the addressees at the direction of CSC, so long as CSC is
not in default of any of its respective obligations under its equity commitment letter and is
ready, willing and able to consummate the Merger. Subject to the foregoing, Parent shall have no
right to enforce this letter unless directed to do so by CSC in its sole discretion. Neither
Parent’s creditors nor any other person shall have any right to enforce this letter or to cause
Parent to enforce this letter.
The Company’s remedies against the Guarantors under the Limited Guarantees shall, and are
intended to be, the sole and exclusive direct or indirect remedies available to the Company against
the Guarantors, including the undersigned, in respect of any liabilities or obligations arising
under, or in connection with, the Merger Agreement and the transactions contemplated thereby,
including in the event Parent or Merger Sub breaches its respective obligations under the Merger
Agreement, whether or not Parent’s or Merger Sub’s breach is caused by the undersigned’s breach of
its obligations under this letter.
This letter shall be treated as confidential and is being provided to the addressees solely in
connection with the Merger. This letter may not be used, circulated, quoted or otherwise referred
to in any document, except with the written consent of CSC. The foregoing notwithstanding, and
without prejudice to the sixth paragraph of this letter, this letter may be provided to the Company
if the Company agrees to treat this letter as confidential, except that the Company and the
undersigned may disclose the existence of this letter to the extent required by law, the applicable
rules of any national securities exchange or in connection with any SEC filings relating to the
Merger, including the Proxy Statement, Schedule 13E-3 or any Schedule 13D filings by the
undersigned.
The parties hereto intend for the contribution of the Commitment by the undersigned to be
treated as a rollover or other tax-free exchange (to the extent of stock received) under the
Internal Revenue Code of 1986, as amended, and will treat such contribution as such for all tax
purposes unless otherwise required by a change in applicable law.
This letter may be executed in counterparts and by facsimile. This letter shall be governed
by, and construed and interpreted in accordance with, the laws of the State of Delaware, without
giving effect to any applicable principles of conflict of laws that would cause the laws of another
State to otherwise govern this Agreement. The parties hereto hereby (a) submit to the personal
jurisdiction of Delaware Court of Chancery, or in the event (but only in the event) that such court
does not have subject matter jurisdiction over an action or proceeding, in the United States
District Court for the District of Delaware, and (b) waive any claim of improper venue or any claim
that those courts are an inconvenient forum. The parties hereto agree that mailing of process or
other papers in connection with any action or proceeding in the manner provided in Section 8.7 of
the Merger Agreement or in such other manner as may be permitted by applicable laws, will be valid
and sufficient service thereof.
EACH OF THE PARTIES HERETO HEREBY WAIVES TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW ANY
RIGHT IT MAY HAVE TO A TRIAL BY JURY WITH RESPECT TO ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING
OUT OF, UNDER OR IN CONNECTION WITH THIS LETTER OR ANY OF THE TRANSACTIONS CONTEMPLATED HEREBY.
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| Very truly yours, |
||||
| /s/ Xxxxxx X. Xxxxxx | ||||
| Xxxxxx X. Xxxxxx | ||||
Accepted and Acknowledged:
MDI HOLDINGS, LLC
By:
|
/s/ Xxxxxx X. Xxxxxxxxx
|
|||
| Title: President |
Schedule A
Commitment
(a) 302,553 shares of Company Common Stock held in the name of Xxxxxx Xxxxxx and 155,000 shares of
Company Common Stock held by Xxxxxx Xxxxxx in the Company’s 401(k) Plan with an aggregate value of
$16,014,355
(b) Proceeds in connection with the Merger with respect to the disposition of restricted stock and
options with an aggregate value of $3,985,645
Schedule B
Other Investors
Court Square Capital Partners, X.X.
Xxxxxx Presidio V, L.P.
Xxxxxx Presidio V, L.P.
