Exhibit 10.2
DEFERRED SHARE REPURCHASE AND OPTION
CANCELLATION AGREEMENT
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REPURCHASE AND OPTION CANCELLATION AGREEMENT, dated as of July 31, 2001,
between RACI Holding, Inc., a Delaware corporation (the "Company"), and Xxxxxx
Xxxxxxx (the "Shareholder").
WHEREAS, effective as of July 31, 2001 (the "Termination Date"), the
Shareholder has resigned from his employment with the Company's wholly owned
subsidiary, Remington Arms Company, Inc. ("Remington");
WHEREAS, in connection with the Shareholder's termination of employment,
the Shareholder, Remington and the Company have entered into a separation
agreement dated July 31, 2001 ("Separation Agreement");
WHEREAS, the Company and the Shareholder are parties to several Stock
Purchase Right Deferred Share Award Agreements and Matching Deferred Share Award
Agreements (collectively, the "Deferred Share Agreements"), pursuant to which
the Shareholder acquired an aggregate of 2,046 deferred shares (the "Deferred
Shares") of the Common Stock, par value $.01 per share, of the Company (the
"Common Stock");
WHEREAS, pursuant to the terms of the Deferred Stock Agreements, the
Shareholder is entitled to receive one share of Common Stock in settlement of
the Deferred Shares that he holds and the Shareholder is required to grant the
Company and Xxxxxxx, Dubilier & Rice Private Equity Fund IV Limited Partnership
(the "CDR Fund") successive rights to repurchase the Deferred Shares following
any termination of the Shareholder's employment with the Company or any
subsidiary thereof that employs the Shareholder as a condition to receipt of the
shares of Common Stock in respect of the Deferred Shares;
WHEREAS, in lieu of providing Shareholder with a share in settlement of
each Deferred Share and exercising its right to repurchase the Deferred Shares
(which right the Company desires to exercise), the Company and the Shareholder
agree that the Company shall pay the Shareholder $180 for each such Deferred
Share;
WHEREAS, the Company and the Shareholder are also parties to several
Management Stock Option Agreements - Service Option and Management Stock Option
Agreements - Performance Option (the "Option Agreements") pursuant to which the
Company granted to the Shareholder options (the "Options" ) to purchase 3,860
shares of Common Stock (the "Option Shares"), at exercise prices between $100 to
$230 per share;
WHEREAS, pursuant to the terms of the Option Agreements, in the event of
any termination of the Shareholders employment with the Company or any
subsidiary thereof that employs the Shareholder, the portion, if any, of the
Options that have not become
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vested on or prior to the date of such termination automatically terminates and
is forfeited effective immediately upon such termination;
WHEREAS, pursuant to the terms of the Option Agreements, the Company and
the CDR Fund have successive rights to repurchase the Vested Options following
any termination of the Shareholder's employment with the Company or any
subsidiary thereof that employs the Shareholder;
WHEREAS, as of the Termination Date, the Shareholder has earned a vested
right to options to purchase 3,155 Option Shares(collectively, the "Vested
Options") and the Shareholder agrees that the Vested Options shall be terminated
and forfeited; and
WHEREAS, as of the Termination Date, the Shareholder has not earned a
vested right to any of the remaining options to purchase 705 Option Shares (the
"Unvested Options") and, accordingly, pursuant to the terms of the Option
Agreements, such Unvested Options will be automatically terminated and forfeited
as of such date.
NOW, THEREFORE, in consideration of the promises and mutual covenants
contained herein and in the Separation Agreement and for other good and valuable
consideration, the Company and the Shareholder hereby agree as follows:
1. Payment for the Deferred Shares. Simultaneously with the execution of
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the Separation Agreement or such other date as the parties shall mutually agree
in writing (the "Closing Date"), the Company shall pay the Shareholder for the
Deferred Shares, at the purchase price set forth in Section 2 below, payable as
provided in Section 5 below.
2. Purchase Price. The Company and the Shareholder agree that the
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purchase price for the Deferred Shares is $180 per Share and that the aggregate
purchase price for the Deferred Shares is $368,280 (the "Deferred Share Purchase
Price"). The Company and the Shareholder acknowledge and agree that the
Deferred Share Purchase Price is equal to the aggregate fair market value of the
Deferred Shares as of the Termination Date.
3. Payment of Purchase Price. (a) On the Closing Date, the Company shall
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deliver to the Shareholder a check, payable to the order of the Shareholder, for
the Deferred Share Purchase Price, subject to reduction for any applicable tax
and other withholding.
(b) The Shareholder shall execute a receipt, in the form attached as
Exhibit A hereto, acknowledging receipt of the Purchase Price.
4. Cancellation of Options. Effective as of the Termination Date and as
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a result of the Shareholder's termination of employment with Remington, the
Shareholder hereby acknowledges and agrees that all of the Unvested Options have
been automatically canceled and terminated and the rights of the Shareholder in
respect of such Unvested Options have been automatically forfeited, in each
case, in accordance with the terms of the Option Agreements and without any
liability or obligation on the part of Company in respect thereof. Effective as
of the Termination Date, the Company
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and the Shareholder agree that, notwithstanding any provisions of the Option
Agreements, the Deferred Share Agreements or any other agreement to the
contrary, all of the Vested Options shall be canceled and terminated and the
rights of the Shareholder in respect thereof have been forfeited, without any
liability or obligation on the part of Company.
5. Shareholder's Release; Deferred Share and Option Agreements and
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Related Documents. The Shareholder hereby waives any and all rights that he may
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have or that otherwise may exist or may have arisen with respect to any of the
Deferred Shares, the Options, the Option Shares or the Common Shares under any
of the Deferred Share Agreements, the Option Agreements, or otherwise in
connection with the offering or sale by the Company or the acquisition by the
Shareholder of the Shares, the grant of the Options by the Company or the
issuance of any Deferred Shares, Common Shares or Option Shares in respect
thereof to the Shareholder, in each case, pursuant to the Confidential Offering
Memorandum, dated as of May 14, 1999, as supplemented (the "Confidential
Offering Memorandum, and ,collectively with any other agreement or document
executed or to be executed in connection therewith, the "Other Transaction
Documents"). The Shareholder and the Company hereby each acknowledges and
agrees that all of their respective rights and obligations under the Deferred
Share Agreements, the Option Agreements and the Other Transaction Documents with
respect to the Deferred Shares, the Options, the Option Shares and the Common
Shares are hereby terminated, and the Shareholder hereby releases and forever
discharges the Company, CDR Fund, and each of their respective subsidiaries,
affiliates, successors and assigns and each of their respective employees,
directors, officers, agents and other representatives from any and all claims,
obligations and liabilities arising under or in connection with any of the
Deferred Share Agreements, the Option Agreements or the Other Transaction
Documents or otherwise in respect of the Deferred Shares, the Options, the
Option Shares or the Common Shares and acknowledges to be fully satisfied all of
his rights under the Deferred Share Agreements, the Option Agreements and the
Other Transaction Documents and otherwise in respect of the Deferred Shares, the
Options, the Option Shares and the Common Shares.
6. Entire Agreement; Applicable Law. This Agreement, including the
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attached Exhibit A, together with the Separation Agreement, constitutes the
entire agreement between the parties with respect to the subject matter hereof.
All prior correspondence and proposals (including summaries of proposed terms)
and all prior promises, representations, understandings, arrangements and
agreements relating to such subject matter (including, but not limited to, those
made to or with Shareholder by any other person or entity) are merged herein and
superseded hereby. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAW OF THE STATE OF DELAWARE, REGARDLESS OF THE LAW THAT
MIGHT BE APPLIED UNDER PRINCIPLES OF CONFLICT OF LAWS.
7. Counterparts. This Agreement may be executed in any number of
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counterparts, each of which shall be deemed to be an original and all of which
together shall constitute one and the same instrument.
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IN WITNESS WHEREOF, the Company and the Shareholder have executed this
Repurchase and Option Cancellation Agreement as of the date first above written.
RACI HOLDING, INC.
By:___________________________
Name:
Title:
______________________________
Xxxxxx Xxxxxxx
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EXHIBIT A
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RECEIPT RELATING TO
THE TERMS OF THE (insert date of Agreement)
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REPURCHASE AGREEMENT
I, Xxxxxx Xxxxxxx, hereby acknowledge receipt from RACI HOLDING, INC. (the
"Company") of a check in the amount of $_______, which amount is in full payment
of the purchase price for the 2,046 Deferred Shares of the Company's Common
Stock, par value $.01 per share that the Company is repurchasing from me.
Dated : ____________________________
______________________
Xxxxxx Xxxxxxx
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