REDEMPTION AND WARRANT PURCHASE AGREEMENT
By and Among
ROLLER BEARING HOLDING COMPANY, INC.
CERTAIN STOCKHOLDERS OF ROLLER BEARING HOLDING COMPANY, INC.
and
XXXXXXX X. XXXXXXXX, AS PURCHASER REPRESENTATIVE
May 20, 1997
TABLE OF CONTENTS
Page
1. DEFINITIONS.......................................................... 3
1.1 Index of Defined Terms...................................... 3
1.2 General Defined Terms....................................... 4
2. THE REDEMPTION AND PURCHASE.......................................... 6
2.1 Redemption.................................................. 6
2.2 Effects of the Primary Redemption........................... 6
2.3 Additional Redemption and Purchase.......................... 6
2.4 The Closing................................................. 7
2.5 Closing Deliveries.......................................... 8
2.6 Closing Deliveries - Holdings............................... 9
3. CONSIDERATION........................................................ 10
3.1 Redemption Consideration.................................... 10
3.2 Purchase Consideration...................................... 10
4. REPRESENTATIONS AND WARRANTIES OF THE REDEEMING
STOCKHOLDERS AND THE SELLING WARRANTHOLDERS.......................... 11
4.1 Litigation.................................................. 11
4.2 Status and Authority........................................ 11
4.3 Conflicts, Consents and Approvals........................... 12
4.4 Shares and Warrants......................................... 13
4.5 Brokers..................................................... 13
4.6 Validity of Representations and Warranties.................. 14
5. REPRESENTATIONS AND WARRANTIES OF HOLDINGS........................... 14
5.1 Authorization............................................... 14
5.2 Conflicts................................................... 15
5.3 Consent of Government Authorities........................... 15
5.4 Brokers..................................................... 16
5.5 Financing Commitments....................................... 16
5.6 Solvency; Surplus........................................... 16
5.7 California Corporations Code Section 2115................... 18
5.8 Capitalization.............................................. 18
6. ADDITIONAL AGREEMENTS................................................ 18
6.1 Conduct of the Business..................................... 18
6.2 Actions of Redeeming Stockholders and Selling Warrantholders 21
6.3 Meetings of Stockholders of Holdings and the Subsidiaries... 23
6.4 Closing Authorizations...................................... 24
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6.5 The Purchaser Representative; Authority to Act on Behalf of
Holdings; Enforcement....................................... 24
6.6 Cooperation................................................. 26
6.7 1997 Financial Statements................................... 27
6.8 Payment of Expenses......................................... 28
6.9 Public Announcements........................................ 29
6.10 Directors' and Officers' Insurance, Indemnification......... 29
6.11 Reasonable Efforts; Consents................................ 32
6.12 Notification of Certain Matters............................. 34
6.13 No Solicitation............................................. 34
6.14 Indemnification of Redeeming Stockholders and Selling
Warrantholders.............................................. 35
6.15 Draft of Solvency Opinion; Access; Supporting Materials..... 37
7. CONDITIONS PRECEDENT................................................. 38
7.1 Conditions Precedent to Obligations of Redeeming
Stockholders and Selling Warrantholders..................... 38
7.2 Conditions Precedent to Obligations of Holdings............. 40
8. SURVIVAL; RECOURSE................................................... 42
8.1 Survival.................................................... 42
8.2 Recourse.................................................... 43
9. TERMINATION; AMENDMENT; WAIVER....................................... 44
9.1 Termination................................................. 44
9.2 Effect of Termination....................................... 44
9.3 Amendment and Waivers....................................... 44
9.4 Extension; Waiver........................................... 45
10. MISCELLANEOUS........................................................ 45
10.1 Notices..................................................... 45
10.2 Further Assurances.......................................... 47
10.3 Entire Agreement............................................ 47
10.4 Captions.................................................... 48
10.5 No Third Party Beneficiary.................................. 48
10.6 Remedies Cumulative......................................... 48
10.7 Dispute Resolution.......................................... 48
10.8 Governing Law............................................... 49
10.9 Assignment.................................................. 49
10.10 Expenses.................................................... 50
10.11 Counterparts................................................ 50
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REDEMPTION AND WARRANT PURCHASE AGREEMENT
This Redemption and Warrant Purchase Agreement dated as of this 20th day
of May, 1997 (this "Agreement") by and among:
ROLLER BEARING HOLDING COMPANY, INC., a Delaware corporation having a
principal place of business at 00 Xxxxx Xxxx Xxxx, Xxxxxxxxx, XX 00000
("Holdings");
THOSE STOCKHOLDERS OF HOLDINGS WHO ARE LISTED ON SCHEDULE
A ATTACHED HERETO (collectively, the "Primary Stockholders"); and
XXXXXXX X. XXXXXXXX AS THE REPRESENTATIVE OF THE NON-
REDEEMING STOCKHOLDERS AND NON-SELLING WARRANTHOLDERS, an
individual having a principal place of business at 00 Xxxxx Xxxx Xxxx, XX
00000 (the "Purchaser Representative").
WHEREAS, the authorized capital stock of Holdings is comprised of shares
of the Class A Voting Common Stock, par value $.01 per share (the "Class A
Common Stock"), Class B Non-Voting Common Stock, par value $.01 per share (the
"Class B Common Stock") Series A Redeemable Exchangeable Cumulative Preferred
Stock (the "Series A Preferred Stock"), Series B Redeemable Exchangeable
Cumulative Preferred Stock (the "Series B Preferred Stock") and Series C
Convertible Redeemable Exchangeable Cumulative Preferred Stock (the "Series C
Preferred Stock" and, together with the Class A Common Stock, the Series A
Preferred Stock, and the Series B Preferred Stock, the "Shares");
WHEREAS, the issued and outstanding Shares are held by those Persons (the
"Stockholders") and in those amounts, as set forth on Schedule B attached
hereto;
WHEREAS, Holdings has issued warrants (the "Warrants") to purchase Class A
Common Stock and Class B Common Stock to those Persons (the "Warrantholders")
and in those amounts set forth on Schedule C attached hereto;
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WHEREAS, the Primary Stockholders are desirous of having Holdings redeem
those shares of Class A Common Stock and Series A Preferred Stock set forth
opposite such Primary Stockholders' names on Schedule A (collectively, the
"Primary Redeemed Shares") and Holdings is desirous of redeeming all of the
Primary Redeemed Shares;
WHEREAS, Holdings is prepared to redeem Shares and purchase Warrants from
those Stockholders ("Additional Stockholders") and Warrantholders ("Additional
Warrantholders") set forth on Schedule D attached hereto;
WHEREAS, the shares of Class A Common Stock, Series A Preferred Stock,
Series B Preferred Stock and Series C Preferred Stock (collectively the
"Non-Redeemed Shares") held by those Stockholders (the "Non-Redeeming
Stockholders") whose names are set forth on Schedule E shall not be redeemed by
Holdings and shall remain outstanding with the same rights as exist on the date
of this Agreement;
WHEREAS, the Warrants (collectively the "Non-Purchased Warrants") held by
those Warrantholders (the "Non-Selling Warrantholders") whose names are set
forth on Schedule F shall not be purchased by Holdings and shall remain in full
force and effect with the same rights and obligations as they exist on the date
of this Agreement; and
WHEREAS, the Purchaser Representative is a Non-Redeeming Stockholder and
Non-Selling Warrantholder, and by reason of the Redemption and Purchase shall be
the largest holder of Shares on a fully diluted basis.
NOW, THEREFORE, in consideration of the premises and the mutual covenants,
agreements, representations and warranties hereinafter set forth and other good
and valuable
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consideration, the receipt and sufficiency of which are hereby acknowledged, and
intending to be legally bound hereby, the parties hereto agree as follows:
1. DEFINITIONS
1.1 Index of Defined Terms. The following is an index of defined terms
utilized in this Agreement:
Defined Term Section Page
------------ ------- ----
1997 Financial Statements 6.7 27
Additional Share Redemption 2.3 6
Additional Redeemed Stock 2.3 6
Additional Stockholders Recitations 2
Additional Warrantholders Recitations 2
Affiliate 1.2 4
Agreement Preface 1
Class A Common Stock Recitations 1
Class B Common Stock Recitations 1
Closing 2.4 7
Closing Date 2.4 7
Consideration 3.2 10
Control 1.2 4
CSFB 6.5(b)(iv) 25
Financing 5.5 16
Financing Assurances 5.5 16
Government Authority 1.2 5
Holdings Preface 1
Holdings Related Agreements 5.1(a) 14
Holdings' Release 7.1(c) 38
Indemnified Parties 6.10(b) 30
Joinder Agreement 2.3 7
Knowledge 1.2 5
Liens 4.3(a) 13
Material 1.2 5
Non-Purchased Warrants Recitations 7
Non-Redeemed Shares Recitations 2
Non-Redeeming Stockholders Recitations 2
3
Non-Selling Warrantholders Recitations 2
Person 1.2 5
Present Fair Salable Value 5.6(a) 17
Primary Redeemed Shares Recitations 2
Primary Redemption 2.1 2.1
Primary Stockholders Preface 1
Purchased Warrants 2.3 7
Purchaser Representative Preface 1
Redeemed Shares 2.3 7
Redeeming Stockholders 2.3 7
Redemption and Purchase 2.3 7
Redemption Consideration 3.1 10
Related Agreements 4.2 12
Sellers' Releases 7.2(b) 40
Series A Preferred Stock Recitations 1
Series B Preferred Stock Recitations 1
Series C Preferred Stock Recitations 1
Shares Recitations 1
Shopping Activities 6.13 34
Solvency 5.6 16
Stockholders Recitations 1
Subject Transactions 5.6(a) 17
Subsidiary 1.2 6
Third Party Transaction 6.13 34
Valuation 7.1(b) 38
Warrant Purchase 2.3 7
Warrant Purchase Consideration 3.2 10
Warrantholders Recitations 1
Warrants Recitations 1
1.2 General Defined Terms. As used herein, the following terms shall have
the meaning indicated:
"Affiliate" shall mean a Person controlled by, in control of, or under
common control with, another Person. For purposes of this definition, "control"
(including the correlative terms "controlled by", "in control of" and "under
common control with"), with respect to any Person, shall mean possession,
directly or indirectly, of the power to direct or cause the
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direction of the management and policies of such Person, whether through the
ownership of voting securities or by contract or otherwise.
"Government Authority" shall mean any foreign, federal, state or local
court, arbitration tribunal, legislative body, administrative agency or
commission, or other governmental or other regulatory authority, agency or
department.
"Knowledge," whether capitalized or not, when used to qualify a
representation, warranty or covenant contained in this Agreement shall mean (i)
that knowledge actually in the possession of the Person making the
representation or warranty or bound by the covenant, or of such other Person as
is referred to and (ii) that knowledge that could be obtained by any such Person
following a reasonable inquiry into the facts underlying the representation,
warranty or covenant. The Knowledge of a Person not a natural person shall be
the Knowledge of such Person's executive officers.
"Material," whether capitalized or not, when used to qualify a
representation, warranty, or covenant contained in this Agreement shall mean,
unless otherwise defined, that there is a reasonable probability, under all the
circumstances and in view of the total mix of information available, that a
reasonable Person in the position of the party relying thereon would attach
importance in deciding whether to enter into and consummate this Agreement in
accordance with the specific terms contained herein.
"Person" shall mean any natural person, corporation, organization,
partnership, association, joint-stock company, limited liability company, joint
venture, trust or other entity or government, or any agency or political
subdivision of any government.
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"Subsidiary" shall mean any entity in which Holdings or a subsidiary of
Holdings, directly or indirectly, owns more than fifty percent (50%) of the
outstanding voting equity securities or ownership interests.
2. THE REDEMPTION AND PURCHASE
2.1 Redemption. Subject to the terms and conditions contained herein, on
the Closing Date, Holdings shall redeem, and the Primary Stockholders shall
deliver to Holdings in consideration for the Redemption Consideration, the
Primary Redeemed Shares (the "Primary Redemption").
2.2 Effects of the Primary Redemption. On the Closing Date, by reason of
the Primary Redemption, and with no further action on the part of Holdings or
the Primary Stockholders, each Primary Redeemed Share shall be returned to the
treasury of Holdings and shall be available for future issuance in accordance
with the Certificate of Incorporation of Holdings and applicable law, and the
Primary Stockholders will cease to have any rights with respect thereto.
2.3 Additional Redemption and Purchase. On the Closing Date, Holdings
shall purchase, and the Additional Stockholders shall deliver to Holdings in
consideration for the Redemption Consideration, all of the Shares held by the
Additional Stockholders which the Additional Stockholders wish to sell to
Holdings (such Shares being sold constituting the "Additional Redeemed Stock"
and such purchase of such shares constituting the "Additional Share
Redemption"); and Holdings shall purchase, and the Additional Warrantholders
shall sell to Holdings in consideration for the Warrant Purchase Consideration,
all of those Warrants which the Additional Warrantholders wish to sell (such
Warrants being sold
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constituting the "Purchased Warrants" and such purchase of such Warrant
constituting the "Warrant Purchase"). Each Additional Stockholder wishing to
sell Stock to Holdings and each Additional Warrantholder wishing to sell
Warrants to Holdings shall, as a condition to any such sale, enter into a
Joinder Agreement (a "Joinder Agreement") in the form attached hereto as
Schedule 2.3 pursuant to which each such sale and each such Additional
Stockholder wishing to sell stock (upon delivery of such Joinder Agreement, a
"Selling Stockholder") and Additional Warrantholder wishing to sell Warrants
(upon delivery of such Joinder Agreement, a "Selling Warrantholder") shall
become subject to the terms and conditions of this Agreement.
For the purposes hereof, the Primary Stockholders and the Selling
Stockholders shall hereinafter be referred to as the "Redeeming Stockholders;"
the Primary Redeemed Shares and the Additional Redeemed Stock shall hereinafter
be referred to as the "Redeemed Shares;" and the Primary Redemption, the
Additional Share Redemption and the Warrant Purchase shall hereinafter be
referred to as the "Redemption and Purchase."
2.4 The Closing. The closing of the transactions described herein (the
"Closing") shall take place as soon as practicable following the satisfaction of
all conditions set forth in Article 7 of this Agreement (the date upon which the
Closing occurs, being referred to herein as the "Closing Date") at the offices
of XxXxxxxxx, Will & Xxxxx, 00 Xxxxxxxxxxx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000 or at
such other place in the City of New York as may be agreed to by the parties. The
Closing shall be effective as of the close of business on the Closing Date. At
the Closing, the parties shall deliver, or cause to be delivered, such
certificates, receipts or other documents or instruments as are provided for in
this Agreement
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and shall attend to such other matters as may be required to comply with the
terms of this Agreement.
2.5 Closing Deliveries.
(a) Primary Stockholders. At the Closing, the Primary Stockholders
shall deliver, or cause to be delivered to Holdings the following:
(i) an opinion, dated the Closing Date, of Xxxxxx, Xxxx & Xxxxxxxx,
LLP ("GDC"), counsel to the Primary Stockholders and, as to certain matters
(litigation, injunctions and other governmental orders and governmental
consents), to Holdings, in form reasonably satisfactory to Holdings; and
(ii) the terminations referred to in Section 7.2(c) below.
(b) Redeeming Stockholders and Selling Warrantholders. At the
Closing, each of the Redeeming Stockholders and the Selling Warrantholders
(including, without limitation, the Primary Stockholders), as the case may be,
shall deliver, or cause to be delivered, to Holdings the following as to each
such Person:
(i) stock certificates representing the Redeemed Shares;
(ii) warrant certificates representing the Purchased
Warrants;
(iii) in accordance with Section 2.3, Joinder Agreements
executed by each of the Selling Stockholders and the Selling Warrantholders
(other than the Primary Stockholders);
(iv) the Sellers' Releases; and
(v) such other documents as the Purchaser Representative and
his counsel may reasonably request prior to the Closing.
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2.6 Closing Deliveries - Holdings. At the Closing, Holdings shall deliver
to the Redeeming Stockholders and Selling Warrantholders the following:
(a) the Consideration;
(b) an opinion, dated the Closing Date, of XxXxxxxxx, Will & Xxxxx,
counsel, as to certain matters, to Holdings, in form reasonably satisfactory to
the Primary Stockholders;
(c) certified copies of resolutions adopted by the Board of
Directors of Holdings authorizing the execution, delivery and performance by
Holdings of this Agreement and the consummation of all transactions contemplated
by this Agreement;
(d) the Solvency Opinion referred to in Section 7.1(b) below;
(e) a certificate of good standing of Holdings and each of the
Subsidiaries issued by the Secretaries of State of the states of their
incorporation and qualification;
(f) the Holdings' Release;
(g) the Certificate of the Chief Financial Officer of Holdings
referred to in Section 7.1(d) below;
(h) (i) all fees payable under the Consulting Agreement with the
Primary Stockholders, and (ii) an amount equal to all expenses to be reimbursed
pursuant to Section 6.8(a);
(i) the agreements contemplated by Section 6.11(d); and
(j) such other documents as the Primary Stockholders and their
counsel may reasonably request prior to the Closing.
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3. CONSIDERATION
3.1 Redemption Consideration. At the Closing, in exchange for each of the
Redeemed Shares and against delivery of a stock certificate representing such
Redeemed Share, Holdings shall cause to be paid, by wire transfer of funds to
the Redeeming Stockholder holding such Redeemed Share (the "Redemption
Consideration"):
(a) for each Redeemed Share of Class A Common Stock, $514.00;
(b) for each Redeemed Share of Series A Preferred Stock, Series B
Preferred Stock and Series C Preferred Stock, the Stated Value of such Redeemed
Share plus an amount equal to any and all dividends, declared or undeclared,
which have accrued but have not been paid from the date of issuance of such
Redeemed Share through the Closing Date, as set forth on Schedule 3.1(b)
attached hereto (which shall be updated to the Closing). The Redeeming
Stockholders holding such Preferred Stock acknowledge and agree that the
calculations of the Redemption Consideration for Preferred Stock set forth on
Schedule 3.1(b) constitute an accurate calculation of the stated value of such
Redeemed Shares plus accrued and unpaid dividends thereon, assuming that the
Closing Date is June 30, 1997.
3.2 Purchase Consideration. At the Closing, in exchange for each Purchased
Warrant and against delivery of a warrant certificate representing such
Purchased Warrant, Holdings shall cause to be paid, by wire transfer of funds to
each Selling Warrantholder the sum of $514.00 less the exercise price applicable
to such Purchased Warrant for each share represented by such Purchased Warrant
(the "Warrant Purchase Consideration" and collectively with the Redemption
Consideration, the "Consideration").
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4. REPRESENTATIONS AND WARRANTIES OF THE REDEEMING
STOCKHOLDERS AND THE SELLING WARRANTHOLDERS
Each Redeeming Stockholder and each Selling Warrantholder represents
and warrants to Holdings and to the Non-Redeeming Stockholders and the
Non-Selling Warrantholders, severally as to each such Redeeming Stockholder or
Selling Warrantholder and not jointly, as follows:
4.1 Litigation. There is no lawsuit, arbitration, action, claim,
investigation hearing, charge, complaint, demand or administrative proceeding by
any Person either (i) pending in any court or before any Government Authority or
non-governmental body against such Redeeming Stockholder or Selling
Warrantholder, (ii) to the Knowledge of such Redeeming Stockholder or Selling
Warrantholder, pending in any court or before any Government Authority or
non-governmental body against Holdings or (iii) to the Knowledge of such
Redeeming Stockholder or Selling Warrantholder, threatened, against Holdings or
such Redeeming Stockholder or Selling Warrantholder, that in any such case could
reasonably be expected to have a Material adverse effect on any of the
transactions contemplated by this Agreement or any Related Agreement, including
any prohibition or restriction on the sale, transfer or exchange of the Redeemed
Shares or the Purchased Warrants.
4.2 Status and Authority. If such Redeeming Stockholder or Selling
Warrantholder is a corporation, such Redeeming Stockholder or Selling
Warrantholder is a corporation duly organized, validly existing and in good
standing under the laws of the jurisdiction in which it is incorporated. If such
Redeeming Stockholder or Selling Warrantholder is a limited partnership, such
Redeeming Stockholder or Selling
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Warrantholder is a limited partnership duly organized and validly existing under
the laws of the jurisdiction in which it is organized. Such Redeeming
Stockholder or Selling Warrantholder has the right, power and authority (i) to
own the Shares or Warrants owned by it, (ii) to execute and deliver, as
applicable, this Agreement, the Sellers' Release and its Joinder Agreement (the
Sellers' Release and Joinder Agreement being the "Related Agreements"), (iii) to
perform its obligations hereunder and thereunder and (iv) to consummate the
transactions in accordance with the terms contemplated hereby and thereby. The
execution, delivery and performance of this Agreement and the Related Agreements
by such Redeeming Stockholder or Selling Warrantholder and the consummation of
the transactions in accordance with the terms contemplated hereby and thereby
have been duly authorized by all necessary action on the part of such Redeeming
Stockholder or Selling Warrantholder. This Agreement and the Related Agreements
have been duly executed and delivered by such Redeeming Stockholder or Selling
Warrantholder and constitute the valid and binding obligations of such Redeeming
Stockholder or Selling Warrantholder, enforceable against such Redeeming
Stockholder or Selling Warrantholder in accordance with their terms.
4.3 Conflicts, Consents and Approvals.
(a) The execution, delivery and performance of this Agreement and
the Related Agreements by such Redeeming Stockholder or Selling Warrantholder do
not and will not result in (i) any conflict with any organizational documents of
such Redeeming Stockholder or Selling Warrantholder (if such Redeeming
Stockholder or Selling Warrantholder is not an individual), (ii) any breach or
violation of or default under any law,
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rule, statute, regulation, judgment, order or decree or any note, bond,
mortgage, agreement, deed of trust, indenture, license, permit, lease, loan
agreement, contract, agreement or any other instrument or arrangement to which
such Redeeming Stockholder or Selling Warrantholder is a party or by which such
Redeeming Stockholder or Selling Warrantholder or its properties or assets are
bound or (iii) the creation or imposition of any liens, security interests,
claims, charges or encumbrances, limitations, rights of others and other
encumbrances of any kind or nature whatsoever ("Liens") on the Shares or
Warrants owned by the Redeeming Stockholder or Selling Warrantholder.
(b) No consent, approval or authorization of or filing,
registration, qualification, designation or declaration with, or notice to, any
Government Authority or any third party is required on the part of such
Redeeming Stockholder or Selling Warrantholder in connection with the execution
and delivery of this Agreement and the Related Agreements or the consummation of
the transactions contemplated hereby and thereby.
4.4 Shares and Warrants. Such Redeeming Stockholder or Selling
Warrantholder owns the Shares and/or Warrants in the amount set forth opposite
its name on Schedule B and/or Schedule C free and clear of all Liens. Except as
indicated on Schedule 4.4 and except for this Agreement, such Redeeming
Stockholder or Selling Warrantholder is not a party to any agreement restricting
the transfer or the voting of any of the Shares or the transfer of any Warrants.
4.5 Brokers. Such Redeeming Stockholder or Selling Warrantholder has not
retained, nor has anyone acting on such Redeeming Stockholder's or Selling
Warrantholder's behalf engaged, retained, or incurred any liability to, any
broker, investment banker, finder
13
or agent or agreed to pay any brokerage fees, commission, finder's fees or other
fees with respect to the transactions contemplated hereby. All negotiations
relating to this Agreement and the transactions contemplated hereby have been
carried out without the intervention of any Person acting on behalf of such
Redeeming Stockholder or Selling Warrantholder in such manner as to give rise to
any claim for any brokerage or finder's commission, fee or similar compensation.
4.6 Validity of Representations and Warranties. No representation or
warranty of such Redeeming Stockholder or Selling Warrantholder in this Article
4 contains any untrue statement of a Material fact or omits to state a Material
fact necessary in order to make the statements in this Article 4 not misleading.
5. REPRESENTATIONS AND WARRANTIES OF HOLDINGS
Holdings represents and warrants to the Redeeming Stockholders and to the
Selling Warrantholders as follows:
5.1 Authorization.
(a) Holdings has full and unrestricted right, power and authority
(i) to execute and deliver this Agreement, and every Related Agreement to which
it is a party (the "Holdings Related Agreements"); (ii) to perform its
obligations hereunder and under the Holdings Related Agreements; and (iii) to
consummate the transactions contemplated hereby and thereby.
(b) The execution and delivery by Holdings of this Agreement and
each of the Holdings Related Agreements, and the performance by Holdings of its
obligations
14
hereunder and thereunder, and the consummation of the transactions contemplated
hereby and thereby, have been duly authorized by all requisite corporate action.
(c) This Agreement and each of the Holdings Related Agreements have
been duly executed and delivered by Holdings and constitute the valid and
legally binding obligations of Holdings enforceable against it in accordance
with their respective terms.
5.2 Conflicts. Neither the execution, delivery or performance by Holdings
of this Agreement or of any Holdings Related Agreement, or the consummation of
the transactions contemplated hereby or thereby, does or will (i) violate or
contravene any provision of the Certificate of Incorporation, By-Laws or any
other organizational documents of Holdings, or of any law, rule, or regulation
of any governmental body or any order, decree or judgment of any court or
Government Authority, (ii) violate, contravene or constitute a breach of or
default under any mortgage, indenture, loan agreement, contract, note or other
agreement or instrument binding upon Holdings or any of its property, (iii)
result in the creation of any Lien upon any property of Holdings, or (iv)
require the consent, approval or action of, or any filing with, or notice to,
any Person.
5.3 Consent of Government Authorities. No consent, approval or action of,
or any filing, registration or qualification with, or notice to, any Government
Authority is required in connection with the execution and delivery by Holdings
of this Agreement or any Holdings Related Agreement in connection with the
performance by of its obligations under this Agreement or such Holdings Related
Agreement or the consummation by Holdings of the transactions contemplated
hereby or thereby.
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5.4 Brokers. Holdings has not retained, nor has anyone acting on Holdings'
behalf engaged, retained, or incurred any liability to, any broker, investment
banker, finder or agent or agreed to pay any brokerage fees commission, finder's
fees or other fees with respect to the transactions contemplated hereby. All
negotiations relating to this Agreement and the transactions contemplated hereby
have been carried out without the intervention of any Person acting on behalf of
Holdings in such manner as to give rise to any claim for any brokerage or
finder's commission, fee or similar compensation.
5.5 Financing Commitments. Holdings has received a written commitment from
Credit Suisse First Boston Corporation ("CSFB") with respect to a senior secured
credit facility in the amount of $70,000,000, and a highly confident letter from
CSFB with respect to senior subordinated notes in the amount of $100,000,000 and
other debt and/or equity securities in the amount of $40,000,000 (in the
aggregate, the "Financing") subject in each case to the conditions and caveats
contained therein (the "Financing Assurances"). Copies of the Financing
Assurances are attached hereto as Schedule 5.5. It is the good faith belief of
Holdings, as of the date hereof, that the Financing contemplated by this Section
5.5 will be obtained. Holdings shall use its commercially reasonable efforts to
obtain all Financing required to consummate the transactions contemplated by
this Agreement, including using commercially reasonable efforts to fulfill or
cause to be fulfilled the conditions contained in such Financing Assurances
which are within its control.
5.6 Solvency; Surplus.
(a) Each of Holdings and its Subsidiary Roller Bearing Corporation
of America, Inc. ("RBCA") will be Solvent immediately after giving effect to (x)
the
16
Redemption and Purchase, (y) the Financing and the application of the proceeds
thereof and (z) any other transactions contemplated by this Agreement or by the
agreements related to the Financing (the "Subject Transactions"). For purposes
of this Agreement, "Solvent" when used with respect to either Holdings or RBCA,
shall mean that, as of any date of determination, (i) the amount of the Present
Fair Salable Value of its assets will, as of such date, exceed all its
liabilities, contingent or otherwise, as of such date, (ii) such corporation
will not have, as of such date, an unreasonably small amount of capital for the
business in which it is engaged or will be engaged and (iii) such corporation
will be able to pay its debts as they become absolute and mature, taking into
account the timing of and amounts of cash to be received by it and the timing of
and amounts of cash to be payable on or in respect of its indebtedness, in each
case after giving effect to the Subject Transactions. For purposes of the
definition of "Solvent, " (A) "debt" means liability on a "claim"; and (B)
"claim" means (i) any right to payment, whether or not such a right is reduced
to judgment, liquidated, unliquidated, fixed, contingent, matured, unmatured,
disputed, undisputed, legal, equitable, secured or unsecured or (ii) the right
to an equitable remedy for breach or performance if such breach gives rise to a
right to payment, whether or not such equitable remedy is reduced to judgment,
liquidated, unliquidated, fixed, contingent, matured, unmatured, disputed,
undisputed, legal, equitable, secured or unsecured. The term "Solvency" shall
have its correlative meaning. "Present Fair Salable Value" means the amount that
may be realized if Holdings' or RBCA's aggregate assets (including goodwill) are
sold as an entirety with reasonable promptness in an arms length transaction
under present conditions for the sale of comparable business enterprises.
17
(b) After giving effect to the Subject Transactions, including the
Financing, the Present Fair Saleable Value of each of Holdings' and RBCA's
assets will exceed such corporation's debt, as defined above, plus the total
"capital" of such corporation, as such "capital" is determined in accordance
with Section 154 of the Delaware General Corporation Law.
5.7 California Corporations Code Section 2115. Neither Holdings nor RBCA
is subject to the provisions of California Corporations Code Section 2115.
5.8 Capitalization. Attached hereto as Schedule 5.8 is a table of the
capitalization of Holdings and its consolidated subsidiaries, as presently
contemplated, and after giving pro forma effect to the transactions contemplated
hereby.
6. ADDITIONAL AGREEMENTS
6.1 Conduct of the Business. Except as otherwise contemplated by this
Agreement, during the period from the date of this Agreement to the Closing,
Holdings and the Subsidiaries will conduct their operations consistent with the
ordinary and usual course of business and with past practice, and Holdings and
the Subsidiaries will take all actions reasonably within their power to ensure
that Holdings and the Subsidiaries, preserve intact their business organization,
keep available the services of their officers and employees and maintain
satisfactory relationships with licensors, licensees, suppliers, contractors,
distributors, customers and others having business relationships with them.
Without limiting the generality of the foregoing, and except as otherwise
expressly provided in this Agreement, prior to the Closing, neither Holdings nor
any of the Subsidiaries will take any action so as to cause Holdings or any
Subsidiary to:
18
(a) amend any of their Certificates of Incorporation or Bylaws or
similar charter documents;
(b) authorize for issuance, issue, sell, deliver or agree or commit
to issue, sell or deliver (whether through the issuance or granting of
options, warrants, commitments, subscriptions, rights to purchase or
otherwise) any stock of any class or any other securities, except upon the
conversion of the Series C Preferred Stock in accordance with its terms as
in effect on the date hereof;
(c) split, combine or reclassify any shares of its capital stock,
declare, set aside or pay any dividend or other distribution (whether in
cash, stock or property or any combination thereof) in respect of its
capital stock, or redeem or otherwise acquire any of its securities or any
securities of the Subsidiaries;
(d) except (x) for the Financing or (y) in the ordinary course of
business in respect of presently existing lines of credit, and consistent
with past practices, (i) incur or assume any long-term or short-term
indebtedness, (ii) assume, guarantee, endorse or otherwise become liable
or responsible (whether directly, contingently or otherwise) for the
obligations of any other Person or (iii) make any loans, advances or
capital contributions to, or investments in, any other Person;
(e) transfer any assets or liabilities to any new Subsidiary or,
except in the ordinary course of business and consistent with past
practice, to any Subsidiary;
(f) grant, waive any infringement of, license or transfer, rights
under any patents, patent rights, trademarks rights, trade names, trade
name rights, copyrights or know-how or waive any Material rights under,
terminate or Materially modify any
19
existing Material license, lease, contract or other agreement or
instrument, other than in the ordinary course of business and consistent
with past practice;
(g) except pursuant to the Financing, acquire, sell, lease, create
Liens with respect to, or otherwise dispose of any Material assets outside
the ordinary course of business or enter into or modify any Material
commitment or transaction outside the ordinary course of business;
(h) change the rates of compensation, commission or bonus payable,
or pay or agree to pay, conditionally or otherwise, any bonus or any extra
compensation, pension, severance pay or vacation pay, to any of Holdings'
or any Subsidiary's employees;
(i) acquire any assets, including any acquisition of any business
enterprise, or otherwise commit to any capital expenditures, other than in
the normal course of business;
(j) discharge any liability except in the ordinary course of
business consistent with past practice;
(k) otherwise in any respect operate other than in the ordinary
course of business;
(l) except as may be required by law, take any action to terminate
or amend any of its employee benefits plans;
(m) except as contemplated by Section 6.7, change any accounting
methods or policies; or
20
(n) take or agree in writing or otherwise to take, any of the
actions or any other action which would make any representation or
warranty of Holdings contained in this Agreement untrue or incorrect in
any Material respect as of the date made or as of a future date
contemplated by such representation or warranty or which will have the
effect of (x) causing Holdings to fail to perform any of its affirmative
covenants contained in this Agreement or in any Related Agreement, or (y)
causing Holdings to violate any negative covenant contained in this
Agreement or in any Related Agreement; or
(o) enter into any agreement or make any commitments to take any of
the types of action described in subsections (a) through (n) above.
6.2 Actions of Redeeming Stockholders and Selling Warrantholders.
(a) None of the Redeeming Stockholders or Selling Warrantholders
shall take any action, or fail to take any reasonable action, which shall have
the effect of causing (i) a representation or warranty of such Redeeming
Stockholder or Selling Warrantholder contained in this Agreement or any Related
Agreement to fail to be true, (ii) such Redeeming Stockholder or Selling
Warrantholder to fail to perform any of its positive covenants contained in this
Agreement or in any Related Agreement, or (iii) such Redeeming Stockholder or
Selling Warrantholder to take any action that violates any of its negative
covenants contained in this Agreement or in any Related Agreement.
(b) None of the Redeeming Stockholders shall take any action in its
capacity as a stockholder of Holdings, which shall have the effect of causing
(i) a representation or warranty of Holdings contained in this Agreement or any
Related
21
Agreement to fail to be true, (ii) Holdings to fail to perform any of its
positive covenants contained in this Agreement or in any Related Agreement, or
(iii) Holdings to take any action that violates any of its negative covenants
contained in this Agreement or in any Related Agreement.
(c) Whether or not the Redemption and Purchase is deemed to be a
"tender offer" within the meaning of Section 14(e) of the Securities Exchange
Act of 1934, as amended, Holdings will:
(i) distribute to each Additional Stockholder disclosure
materials containing (A) a description of the materials terms of the offer
to redeem the Shares and to purchase the Warrants, (B) a copy of this
Agreement, (C) a description of the proposed Financing transactions, (D)
historical financial statements of the Company for the fiscal years ended
March 28, 1992, March 27, 1993, March 26, 1994, March 25, 1995 and March
31, 1996, (E) pro forma financial statements of the Company for the fiscal
year ended Xxxxx 00, 0000, (X) a description of the federal income tax
considerations of the Redemption and Purchase, (G) a description of the
risks associated with the general corporation laws and the fraudulent
conveyance laws of the State of Delaware, (H), a copy of the Joinder
Agreement and the procedure for executing and delivering such document to
Holdings (I) one or more execution copies of the Joinder Agreement and (J)
any other information necessary to comply with Section 6.2(c)(ii);
22
(ii) ensure that the disclosure materials described in Section
6.2(c)(i) shall not contain any untrue statement of a Material fact or
omit to state a Material fact necessary in order to make the statements
made therein not misleading;
(iii) keep open the offer to redeem the Additional Shares and
to purchase the Additional Warrants for a reasonable period of time; and
(iv) inform each Additional Stockholder in writing of any
material amendment of this Agreement or modification of the terms and
conditions of the offer to redeem the Additional Shares and to purchase
the Additional Warrants and keep open the offer to redeem the Additional
Shares and to purchase the Additional Warrants for a reasonable period of
time after any such amendment or modification.
6.3 Meetings of Stockholders of Holdings and the Subsidiaries. Holdings
and the Redeeming Stockholders and Selling Warrantholders agree that, should any
vote of stockholders of Holdings or any Subsidiary be required by applicable law
or determined to be advisable in respect of the transactions contemplated
hereby, such parties shall vote all shares of stock of any class or series of
Holdings and the Subsidiaries in favor of proceeding with such transactions, and
agree to call any meetings required for such purpose; provided, however, that
the ultimate votes in respect of the within transactions and the Financing shall
be undertaken in accordance with Section 6.4 below; and provided, further, that
the Redeeming Stockholders and Selling Warrantholders shall not be required to
vote any Shares in favor of matters (a) which would be Materially adverse to the
interests of such Redeeming Stockholder or Selling Warrantholder if the Closing
does not occur, (b) which would Materially adversely affect its rights under
this Agreement or any Related Agreement or (c)
23
which would Materially adversely affect its rights as a stockholder or
warrantholder except as otherwise contemplated by this Agreement or any Related
Agreement.
6.4 Closing Authorizations. In the event that there is a change in the
composition of the Board of Directors of Holdings or any Subsidiary prior to the
Closing or the termination of this Agreement, the Redeeming Stockholders shall
vote their respective shares in Holdings as may be necessary to approve,
execute, deliver and, if necessary, ratify this Agreement, the Related
Agreements and the Financing and as may otherwise be necessary in order to
complete Closing, including, without limitation, electing additional or
replacement directors.
6.5 The Purchaser Representative; Authority to Act on Behalf of Holdings;
Enforcement.
(a) The Purchaser Representative shall act as the representative of
the Non-Redeeming Stockholders and Non-Selling Warrantholders for the purposes
of this Agreement, and in respect of the transactions contemplated hereby.
(b) In connection with pursuing the transactions contemplated hereby
on behalf of Holdings, including the Financing, the Purchaser Representative and
his designated agents and representatives shall have the express authority to
act on behalf of Holdings and to represent and hold themselves out to third
parties as having such authority; provided, however, (i) the Purchaser
Representative shall keep the Primary Stockholders reasonably informed of the
status of all discussions respecting the Financing; (ii) the Purchaser
Representative shall not enter into any binding commitments with respect to the
Financing (A) which will survive the termination of this Agreement if the
Closing does not occur or (B)
24
which (x) differ Materially and in a manner adverse to Holdings from those terms
set forth in the Financing Assurances and (y) in the reasonable opinion of the
Primary Stockholders, by reason of such differences, Materially and adversely
affect the Solvency of Holdings; (iii) the Purchaser Representative shall not
enter into any binding commitments in respect of the Financing that would commit
Holdings to complete such Financing unless the aggregate proceeds thereof are
sufficient to complete the Redemption and Purchase; and (iv) the Purchaser
Representative shall not enter into any binding commitments with respect to the
Financing which will subject the Primary Stockholders to any liability under
applicable federal or state securities laws. Without limiting the generality of
the foregoing, the Primary Stockholders acknowledge that Holdings has entered
into an engagement arrangement with CSFB in connection with which CSFB has been
retained to arrange the Financing. The Primary Stockholders hereby consent to
such engagement in the form attached hereto as Schedule 6.5.
(c) Notwithstanding anything contained herein to the contrary, and
without limiting the generality of the provisions of Section 8 below, neither
Holdings, nor any of the Stockholders (including the Redeeming Stockholders and
the Selling Warrantholders) shall have any rights of recourse of any kind or
nature whatsoever against the Purchaser Representative on account of this
Agreement or the Related Agreement or the transactions contemplated hereby or
thereby, (i) regardless of whether or not the Closing occurs, and (ii) if the
Closing does not occur, regardless of the reason therefor, and (iii) if the
Closing does not occur, regardless of the nature of the Purchaser
Representative's actions or omissions in connection therewith.
25
(d) The parties hereto acknowledge that after the Redemption and
Purchase, the Non-Redeeming Stockholders and the Non-Selling Warrantholders
shall be the primary holders of all outstanding equity interests in Holdings and
that they, therefore, will ultimately benefit by virtue of the transactions
contemplated thereby. Pursuant thereto, each of Holdings, the Redeeming
Stockholders and the Selling Warrantholders hereby acknowledges and confirms
that the Non-Redeeming Stockholders and the Non-Selling Warrantholders are
ultimate beneficiaries of the transactions contemplated hereby. Therefore, each
of Holdings, the Redeeming Stockholders and the Selling Warrantholders hereby
grant to the Purchaser Representative, in the capacity of representative of the
Non-Redeeming Stockholders and Non-Selling Warrantholders, the right to enforce
the obligations of Holdings, the Redeeming Stockholders and the Selling
Warrantholders hereunder, insofar as such obligations relate to the consummation
of the Redemption and Purchase. Without limiting the generality of the
foregoing, and in recognition of the possibility that remedies of law may be
inadequate, the Purchaser Representative shall be entitled to seek and obtain
injunctive or other equitable relief on behalf of the Non-Redeeming Stockholders
and the Non-Selling Warrantholders in order to effect and enforce the obligation
of all of the parties hereto to consummate the Redemption and Purchase. Such
actions by the Purchaser Representative may be to compel performance hereof by
Holdings or, on behalf of Holdings, to compel performance by the Redeeming
Stockholders and Selling Warrantholders.
6.6 Cooperation.
(a) The Primary Stockholders shall cooperate with CSFB as may be
reasonably requested by CSFB in connection with the arrangement of the
Financing.
26
Pursuant thereto, Holdings, the Subsidiaries and the Primary Stockholders hereby
authorize the Purchaser Representative, in his capacity as an officer of
Holdings and the Subsidiaries, to pursue the arrangement of the Financing in
such fashion as is, and subject to Section 6.5(b)(ii), (iii) and (iv), on such
terms as are, acceptable to the Purchaser Representative in such capacity.
(b) Between the date hereof and the Closing, Holdings will give the
Purchaser Representative and its authorized representatives (including CSFB),
and potential sources of the Financing and their authorized representatives,
access during normal business hours to all facilities, books and records of
Holdings and the Subsidiaries as the Purchaser Representative and its authorized
representatives may reasonably request; will permit the Purchaser
Representative, potential sources of the Financing and their respective
authorized representatives to make such inspections as they may reasonably
require; and will cause its officers and those of the Subsidiaries to furnish
the Purchaser Representative, potential sources of the Financing and their
respective authorized representatives with such financial and operating data and
other information with respect to the business and properties of Holdings and
the Subsidiaries as the Purchaser Representative may from time to time
reasonably request.
6.7 1997 Financial Statements. The Purchaser Representative has notified
Holdings and the Primary Stockholders that it wishes to institute the changes
set forth on Schedule 6.7 to Holdings' accounting methods effective with the
financial statements covering the fiscal year ended March 29, 1997 (the "1997
Financial Statements") and certain prior periods. Pursuant thereto, (i) unless
otherwise approved by the Primary Stockholders,
27
Holdings shall not issue its 1997 Financial Statements prior to the Closing
Date, (ii) Holdings shall instruct its employees and accountants to cooperate
with the Purchaser Representative in preparing the 1997 Financial Statements
with the changes in accounting methods designated by the Purchaser
Representative, and (iii) concurrently with the Closing (or earlier, but only
with the approval of the Primary Stockholders), Holdings shall issue the 1997
Financial Statements with such changes in accounting methods included therein.
If for any reason the Closing is not consummated by June 30, 1997, Holdings
shall be free to issue the 1997 Financial Statements with or without such
changes in accounting methods as it deems appropriate, without regard to the
foregoing.
6.8 Payment of Expenses.
(a) Holdings shall reimburse each of the Primary Stockholders for,
or at the request of either Primary Stockholder directly satisfy, the following
amounts in respect of the expenses of such parties in connection with the
negotiation of this Agreement and the Related Agreements, the consummation of
the Redemption and Purchase and otherwise in connection with the transactions
contemplated by this Agreement:
(i) if the transactions contemplated by this Agreement are not
consummated, up to $150,000 in reasonable legal fees actually incurred by such
parties, to GDC, plus GDC's actual out-of-pocket disbursements,
(ii) if the transactions contemplated by this Agreement are
consummated, a fixed amount of $200,000 payable to GDC in respect of all of its
fees and disbursements.
28
(b) If (i) the transactions contemplated by this Agreement are
consummated or (ii) the transactions contemplated by this Agreement are not
consummated because of the failure of a condition set forth in Section 7,
Holdings shall satisfy all reasonable out-of-pocket expenses (including fees and
expenses) actually incurred by it or by the Non-Redeeming Stockholders and
Non-Selling Warrantholders in connection with the transactions contemplated by
this Agreement (including the arrangement of the Financing). Following the date
hereof, the Purchaser Representative shall provide Holdings with a reasonable
budget for all such expenses. Holdings' present good faith estimate of the
dollar amount of such expenses is $1,000,000 in the aggregate.
6.9 Public Announcements. The Purchaser Representative, Holdings and the
Primary Stockholders will consult with each other before issuing any press
release or otherwise making any public statements with respect to the
transactions contemplated by this Agreement and shall not issue any such press
release or make any such public statement prior to such consultation, except as
may be required by law or compulsory legal process or by obligations pursuant to
any listing agreement with any national securities exchange.
6.10 Directors' and Officers' Insurance, Indemnification.
(a) Holdings agrees that all rights to indemnification now existing
or thereafter arising at or prior to Closing in favor of the present or former
directors or officers of Holdings, together with such other directors of
Holdings as may be acting as such prior to the Closing, as provided in its
Certificate of Incorporation or Bylaws as in effect on the date thereof or
pursuant to other agreements in effect on the date thereof (it being understood
that between the date hereof and the Closing Date, Holdings shall enter into
indemnification
29
agreements in the form provided by the Primary Stockholders to Holdings prior to
the date hereof with all persons who have served as directors or officers of
Holdings or any Subsidiary at any time during 1997) shall survive the
termination of this Agreement, the consummation of the transaction contemplated
by this Agreement and the Closing, and continue in full force and effect until
the expiration of the applicable statute of limitations periods, provided that,
in the event any claim or claims are asserted or made within such period, all
rights to indemnification in respect of any such claim or claims shall continue
until final disposition of any and all such claims.
(b) Holdings shall, regardless of whether the transactions
contemplated by this Agreement are effected, indemnify and hold harmless to the
fullest extent permitted under applicable law and under its Certificate of
Incorporation, Bylaws and any other agreement in effect on the date hereof (and
shall also advance expenses as incurred to the fullest extent permitted under
applicable law provided the person to whom expenses are advanced provides an
undertaking to repay such advances if it is ultimately determined that such
person is not entitled to indemnification), all of the present and former
officers and directors of Holdings and the Subsidiaries, such other officers and
directors of Holdings and the Subsidiaries as may be acting as such prior to the
Closing and all of the Stockholders (collectively, the "Indemnified Parties")
against any costs or expenses (including attorneys' fees), judgments, fines,
losses, claims, damages, liabilities and amounts paid in settlement in
connection with any claim, action, suit, proceeding or investigation, whether
civil, criminal, administrative or investigative, arising out of or pertaining
to any action or omission occurring with respect to the transactions
contemplated by this Agreement (other than any of
30
the above arising from the breach by such Indemnified Party of any
representation, warranty or covenant contained in this Agreement, any Related
Agreement or any Financing Assurance). In the event of any such claim, action,
suit, proceeding or investigation (whether arising before or after the Closing),
if Holdings has the financial capacity to pay all monies due under this Section
6.10 and such payment is not prohibited by compulsory legal process, Holdings
shall have the right to assume the defense thereof, except that if Holdings
elects not to assume such defense or counsel for the Indemnified Parties advises
that there are issues which may raise conflicts of interest between Holdings and
the Indemnified Parties, the Indemnified Parties may retain counsel satisfactory
to them, and Holdings shall pay all reasonable fees and expenses of such counsel
for the Indemnified Parties promptly as statements therefor are received,
provided, however, that Holdings shall pay for only one firm of counsel for all
Indemnified Parties in any jurisdiction unless the use of one counsel for such
Indemnified Parties would present such counsel with a conflict of interest and
provided, that Holdings shall not be liable for any settlement effected without
its prior written consent, and provided further that Holdings shall not have any
obligation hereunder to any Indemnified Party when and if a court of competent
jurisdiction shall ultimately determine, and such determination shall have
become final, that the indemnification of such Indemnified Party in the manner
contemplated hereby is prohibited by applicable law. Any Indemnified Party
wishing to claim indemnification under this Section 6.10, upon learning of any
such claim, action, suit, proceeding or investigation, shall notify Holdings
thereof, but the failure to so notify shall not relieve Holdings of any
liability it may have to such Indemnified Party if such failure does not
Materially prejudice Holdings as the indemnifying
31
party. The parties intend, to the extent not prohibited by applicable law, that
the indemnification provided for in this Section 6.10 shall apply to negligent
acts or omissions by the Indemnified Parties. If such indemnify is not available
with respect to any Indemnified Party, then Holdings and the Indemnified Party
shall contribute to the amount payable in such proportion as is appropriate to
reflect relative faults and benefits.
(c) In the event any action, suit, proceeding or investigation
relating hereto or to the transactions contemplated hereby is commenced by a
third party whether before or after the Closing, the parties hereto agree to
cooperate and use their reasonable efforts to defend against and respond
thereto.
(d) The Indemnified Parties shall be deemed to be third party
beneficiaries of, and shall have the legal right to enforce, the provisions of
this Section 6.10.
6.11 Reasonable Efforts; Consents.
(a) Subject to the terms and conditions herein provided, each of the
parties hereto agrees to use its reasonable efforts to take or cause to be taken
all action, and to do, or cause to be done, all things necessary, proper or
advisable under applicable laws and regulations to consummate and make effective
the transactions contemplated by this Agreement. In case at any time after the
Closing any further action is necessary or desirable to carry out the purposes
of this Agreement, the proper officers and directors of each party to this
Agreement shall take all such necessary action.
(b) Holdings, the Purchaser Representative and the Redeeming
Stockholders and Selling Warrantholders each will use its reasonable efforts to
obtain
32
consents of all third parties and Government Authorities necessary to the
consummation of the transactions contemplated by this Agreement.
(c) Subject to the review and approval of the Primary Stockholders
(which approval shall not be unreasonably delayed or withheld), Holdings shall,
at its sole expense, take all actions necessary to ensure that the transactions
contemplated by this Agreement comply with all applicable state environmental
laws regarding the transfer of real property, including, without limitation, the
New Jersey Industrial Site Recovery Act, N.J.S.A. 13:1K-6 et seq. and the
Connecticut Transfer Act, as amended, Conn. Gen. Stat. Sec. 22a-134 et seq.
(collectively, the "Transfer Statutes"). Holdings shall indemnify and hold
harmless the Primary Stockholders for all Damages incurred by the Primary
Stockholders as a result of the failure of Holdings to secure any consents from
any Government Authorities required under the Transfer Statutes. As used in this
Section 6.11, "Damages" means all demands, claims, actions or causes of action,
assessments, losses, damages, costs, expenses, liabilities, judgments, awards,
fines, sanctions, penalties, charges and amounts paid in settlement net of
insurance proceeds actually received, including without limitation, reasonable
costs, fees and expenses of attorneys, accountants and other agents of Holdings.
(d) Holdings shall use its commercially reasonable efforts to obtain
a written agreement, signed by each of the Non-Redeeming Stockholders and
Non-Selling Warrantholders, and shall be obligated to obtain a written agreement
signed by the Purchaser Representative in his individual capacity, in each case
agreeing to waive any and all rights under any circumstances to unwind the
Redemption and Purchase or otherwise to seek to obtain a return of any or all of
the Consideration, whether on a theory that the Redemption
33
and Purchase constituted, or resulted in, a fraudulent conveyance under
applicable law, the Redemption and Purchase violated Section 174 of the Delaware
General Corporation Law, or otherwise.
6.12 Notification of Certain Matters. The parties hereto each agree to
give prompt notice to each other party of (i) the occurrence, or failure to
occur, of any event which occurrence or failure to occur would be likely to
cause any representation or warranty contained in this Agreement to be untrue or
inaccurate in any Material respect at any time from the date hereof to the
Closing, (ii) any Material failure on its part to comply with or satisfy any
covenant, condition or agreement to be complied with or satisfied by it
hereunder; provided, however, that the delivery of any notice pursuant to this
Section 6.12 shall not limit or otherwise affect the remedies available
hereunder to the party receiving such notice, and (iii) any action, suit or
proceeding that shall be instituted or threatened against such party to
restrain, prohibit or otherwise challenge the legality of any transaction
contemplated by this Agreement.
6.13 No Solicitation. From the date hereof through the earlier to occur of
(i) the Closing Date, and (ii) the termination of this Agreement in accordance
with its terms, neither Holdings nor any of the Subsidiaries nor any of the
Redeeming Stockholders or Selling Warrantholders shall directly or indirectly,
including through any third-party intermediaries, representatives, investment
bankers, or the like, engage in any Shopping Activities (as defined below).
"Shopping Activities" shall mean any and all activities having the direct or
indirect intent or possible effect of leading to a transaction involving either
(A) a sale of all or substantially all of the assets of Holdings (or of Holdings
and the Subsidiaries taken as a
34
whole) or such portion of the Shares as may constitute control of Holdings (or
of the Subsidiaries), or (B) a recapitalization of the Holdings (a "Third Party
Transaction"). In connection therewith, neither Holdings nor any Subsidiary, nor
any Redeeming Stockholder or Selling Warrantholder shall directly or indirectly
(i) solicit any inquiries respecting a Third Party Transaction, (ii) respond to
any inquiries respecting a Third Party Transaction other than to indicate that
no such Transaction will be considered during the period covered by this Section
6.13, (iii) engage any intermediary to act in any fashion in respect of a Third
Party Transaction, or (iv) otherwise undertake any activities that could
reasonably be expected to lead to a Third Party Transaction.
6.14 Indemnification of Redeeming Stockholders and Selling Warrantholders.
Holdings shall, from and after the Closing, indemnify and hold harmless to the
fullest extent permitted under applicable law (and shall also advance expenses
as incurred to the fullest extent permitted under applicable law provided the
person to whom expenses are advanced provides an undertaking to repay such
advances if it is ultimately determined that such person is not entitled to
indemnification), the Redeeming Stockholders and the Selling Warrantholders
against the amount of any portion of the Consideration returned to Holdings,
together with related costs or expenses (including attorneys' fees) by virtue of
judgments, fines, losses, claims, damages, liabilities and amounts paid in
settlement in connection with any claim, action, suit, proceeding or
investigation, whether civil, criminal, administrative or investigative, arising
out of or pertaining to a breach of the representation and warranty contained in
Section 5.6 of this Agreement. In the event of any such claim, action, suit,
proceeding or investigation (whether arising before or after the Closing), if
Holdings has the
35
financial capacity to pay all monies due under this Section 6.14 and such
payment is not prohibited by compulsory legal process, Holdings shall have the
right to assume the defense thereof, except that if Holdings elects not to
assume such defense or counsel for the Redeeming Stockholders and Selling
Warrantholders advises that there are issues which may raise conflicts of
interest between Holdings and the Redeeming Stockholders and Selling
Warrantholders, the Redeeming Stockholders and Selling Warrantholders may retain
counsel satisfactory to them, and Holdings shall pay all reasonable fees and
expenses of such counsel for the Redeeming Stockholders and Selling
Warrantholders promptly as statements therefor are received, provided, however,
that Holdings shall pay for only one firm of counsel for all Redeeming
Stockholders and Selling Warrantholders in any jurisdiction unless the use of
one counsel for such Redeeming Stockholders and Selling Warrantholders would
present such counsel with a conflict of interest and provided, that Holdings
shall not be liable for any settlement effected without its prior written
consent, and provided further that Holdings shall not have any obligation
hereunder to any Redeeming Stockholders and Selling Warrantholders when and if a
court of competent jurisdiction shall ultimately determine, and such
determination shall have become final, that the indemnification of such
Redeeming Stockholders and Selling Warrantholders in the manner contemplated
hereby is prohibited by applicable law. Any Redeeming Stockholders and Selling
Warrantholders wishing to claim indemnification under this Section 6.14, upon
learning of any such claim, action, suit, proceeding or investigation, shall
notify Holdings thereof, but the failure to so notify shall not relieve Holdings
of any liability it may have to such Redeeming Stockholders and Selling
Warrantholders if such failure does not Materially prejudice Holdings as the
indemnifying
36
party. If such indemnify is not available with respect to any Redeeming
Stockholders and Selling Warrantholders, then Holdings and the Redeeming
Stockholders and Selling Warrantholders shall contribute to the amount payable
in such proportion as is appropriate to reflect relative faults and benefits.
6.15 Draft of Solvency Opinion; Access; Supporting Materials.
(a) Not later than three (3) days prior to the Closing Date,
Holdings shall cause to be delivered to the Primary Stockholders a substantially
complete draft of the Solvency Opinion prepared by Houlihan, Lokey, Xxxxxx &
Xxxxx or by such other valuation consultant reasonably approved in writing by
the Primary Stockholders (the "Valuation Consultant").
(b) Holdings shall instruct the Valuation Consultant to make
available to the Primary Stockholders all materials provided to the Valuation
Consultant by Holdings to assist the Valuation Consultant in preparing the
Solvency Opinion.
(c) Holdings shall make available to the Primary Stockholders such
other materials reasonably accessible to it as may be necessary or, in the
reasonable discretion of the Primary Stockholders, desirable, to evaluate the
Solvency Opinion or any of the materials made available pursuant to Section
6.15(b). Without limiting the foregoing, Holdings shall distribute to designated
representatives of the Primary Stockholders draft copies of the Confidential
Memorandum under preparation by Holdings in connection with the Financing on or
after May 23, 1997 as such drafts are generally distributed to the parties
involved in the preparation of such Confidential Memorandum and shall invite
designated representatives
37
of the Primary Stockholders to attend as observers all drafting sessions
respecting such Confidential Memorandum.
7. CONDITIONS PRECEDENT
7.1 Conditions Precedent to Obligations of Redeeming Stockholders and
Selling Warrantholders. The obligations of the Redeeming Stockholders and the
Selling Warrantholders to consummate the Redemption and Purchase are subject to
the satisfaction at or prior to the Closing of the following conditions:
(a) The representations and warranties of Holdings contained in
Section 5 hereof shall be true and correct in all Material respects at and as of
the Closing;
(b) Holdings shall have delivered (i) to the Redeeming Stockholders
and the Selling Warrantholders a so-called "Solvency Opinion" with respect to
each of Holdings and RBCA (the "Solvency Opinion") dated the Closing Date,
addressed to the Redeeming Stockholders and Selling Warrantholders, containing
the "Opinion" described in paragraph 2 of the proposed engagement letter
attached hereto as Schedule 7.1(b) and otherwise in form and substance
reasonably satisfactory to the Primary Stockholders and (ii) to the current and
former directors of Holdings and RBCA, a reliance letter entitling each of them
to rely on such Solvency Opinion;
(c) Holdings and the Subsidiaries shall have delivered to each of
the Redeeming Stockholders and Selling Warrantholders a release of any and all
claims (other than claims arising out of or relating to the rights of Holdings
under this Agreement and the Related Agreements or, in the case of Redeeming
Stockholders and Selling Warrantholders other than the Primary Stockholders,
claims arising out of or relating to any past or present
38
employment of such Person with Holdings or the Subsidiaries) whether matured or
contingent, known or unknown, in the form attached hereto as Schedule 7.1(c)
(the "Holdings' Release");
(d) There shall have been delivered a certificate of the Chief
Financial Officer of Holdings and RBCA, solely in his capacity as such and with
no personal recourse to such officer, dated the Closing Date, to the effect that
(i) each such corporation is Solvent (as defined in Section 5.6(a)) immediately
after giving effect to the Subject Transactions and (ii) after giving effect to
the Subject Transactions, the Present Fair Saleable Value of each of Holdings'
and RBCA's assets exceeds its "debt" (as such term is defined in Section
5.6(a)), plus the total "capital" of such corporation, as such "capital" is
determined in accordance with Section 154 of the Delaware General Corporation
Law;
(e) Holdings shall have performed in all Material respects its
obligations under this Agreement required to be performed at or prior to the
Closing;
(f) No Government Authority shall have enacted, issued, promulgated,
enforced or entered any statute, rule, regulation, injunction or other order
(whether temporary, preliminary or permanent) which has the effect of
prohibiting consummation of the Redemption and Purchase;
(g) All fees and expenses owing to GDC for services rendered to
Holdings and the Subsidiaries other than in respect of the transactions
contemplated hereby shall have been paid; provided that Holdings shall have
received xxxxxxxx with respect to all matters thereto on or before June 15, 1997
and shall have approved such xxxxxxxx for payment after having had a reasonable
opportunity to discuss such fees and expenses with GDC; and
39
provided, further, that Holdings acknowledges that the fees and expenses due and
owing through February 28, 1997 are $19,960.91 and shall be responsible for no
additional fees and expenses to GDC in respect of such period.
(h) All outstanding fees and xxxxxxxx in respect of the Consulting
Agreement with the Primary Stockholders shall have been paid by wire transfer to
an account designated by the Primary Stockholders; provided, further, that the
expenses set forth on Schedule 7.1(h) are all such expenses due and owing
through April 30, 1997; and
(i) All consents necessary to undertake the Redemption and Purchase
shall have been obtained.
7.2 Conditions Precedent to Obligations of Holdings. The obligations of
Holdings to consummate the Redemption and Purchase with respect to each
Redeeming Stockholder or Selling Warrantholder are subject to the satisfaction
at or prior to the Closing of each of following conditions; provided that
Holdings shall have no obligation to consummate the Redemption and Purchase with
respect to any Redeeming Stockholder or Selling Stockholder unless and until
each of such conditions shall have been satisfied with respect to the Primary
Stockholders:
(a) The representations and warranties of such Redeeming Stockholder
or such Selling Warrantholders contained in Section 4 hereof shall be true and
correct in all Material respects at and as of the Closing;
(b) Such Redeeming Stockholder or Selling Warrantholder shall have
delivered to Holdings and the Purchaser Representative a release of any and all
claims (other than claims arising out of or relating to the rights of such
Redeeming Stockholder or Selling
40
Warrantholder under this Agreement and the Related Agreements or, in the case of
Redeeming Stockholders and Selling Warrantholders other than the Primary
Stockholders, claims arising out of or relating to any past or present
employment of the Redeeming Stockholders or Selling Warrantholders with Holdings
or the Subsidiaries), whether matured or contingent, known or unknown, from and
after the Closing (the "Sellers' Releases") in the form attached hereto as
Schedule 7.2(b);
(c) The Primary Stockholders and their respective Affiliates shall
have fully and indefeasibly terminated all contractual relationships with
Holdings and/or the Subsidiaries (including that certain Third Amended and
Restated Consulting Agreement, dated as of October 30, 1996 (the "Consulting
Agreement")); provided, however, that the indemnity provided by Section 14 of
the Consulting Agreement shall survive the termination thereof in accordance
with its terms.
(d) Such Redeeming Stockholder or Selling Warrantholder shall have
performed in all Material respects its obligations under this Agreement required
to be performed by it at or prior to the Closing;
(e) No Government Authority shall have enacted, issued, promulgated,
enforced or entered any statute, rule, regulation, injunction or other order
(whether temporary, preliminary or permanent) which is in effect and has the
effect of prohibiting consummation of the Redemption and Purchase or the
provision of the Financing necessary for such transaction;
(f) All consents necessary to undertake the Redemption and Purchase
and to conduct the businesses of Holdings and the Subsidiaries after the Closing
Date in a manner
41
consistent with that as conducted by Holdings and the Subsidiaries prior to the
Closing Date shall have been obtained, except for such consents the failure of
which to have been so obtained would not, individually or in the aggregate,
Materially adversely affect the businesses of Holdings and the Subsidiaries
after the Closing Date or the transactions contemplated by this Agreement; and
(g) The Financing shall have been consummated on terms and
conditions satisfactory to the Purchaser Representative (provided that the terms
set forth on Schedule 7.2(g) hereto, or more favorable terms (taken as a whole),
shall be deemed to be satisfactory) so as to provide sufficient funds to effect
the Redemption and Purchase; provided, however, the Purchaser Representative, on
behalf of Holdings shall not have the right to elect not to consummate the
Financing unless either (i) the terms thereof are not satisfactory, as
aforesaid, or (ii) despite its commercially reasonable efforts, it is unable to
satisfy one or more conditions to the consummation of the Financing contemplated
by the Financing Assurances and by reason of such failure, the financial
institutions providing such Financing shall elect not to consummate such
Financing.
8. SURVIVAL; RECOURSE
8.1 Survival. Except for the warranties and representations of the
Redeeming Stockholders and Selling Warrantholders set forth in Section 4 hereof
(other than the first two sentences of Section 4.2) and of Holdings set forth in
Section 5 hereof, and the covenants set forth in Sections 6.8, 6.9, 6.10, 6.11
and 6.14 and Section 10 hereof, which warranties, representations and covenants
shall survive the Closing and the consummation of the transactions contemplated
by this Agreement (or the earlier termination hereof), the
42
warranties, representations and covenants of Holdings, the Redeeming
Stockholders and the Selling Warrantholders contained in this Agreement or in
any Related Agreement shall not survive the Closing and the consummation of the
transactions contemplated hereby.
8.2 Recourse. Except as set forth below, none of the Purchaser
Representative, Holdings, or any Redeeming Stockholder or Selling Warrantholder
shall be subject to any recourse of any kind or nature to any other Person
(including without limitation each other or any Non-Redeeming Stockholder or
Non-Selling Warrantholder) on account of the transactions contemplated hereby:
(a) A Redeeming Stockholder and a Selling Warrantholder shall be
subject to recourse after the Closing on account of any breach of a
representation or warranty by it under Section 4 hereof (other than the first
two sentences of Section 4.2); provided that the maximum liability of such
Redeeming Stockholder or Selling Warrantholder shall be the total amount of
Consideration received by it.
(b) Holdings shall be subject to recourse to a Redeeming Stockholder
or a Selling Warrantholder on account of a breach by it of a representation or
warranty under Section 5 hereof, and pursuant to its indemnification obligations
under Sections 6.10 and 6.14.
(c) As set forth in Section 6.5(d) above, the Purchaser
Representative shall have the right to seek recourse against Holdings and any
Redeeming Stockholder and Selling Warrantholder on account of the failure by any
one of them prior to the Closing to satisfy its respective obligations under
Section 6 hereof, as well as to consummate the Redemption and
43
Purchase. Further, and as set forth in such Section 6.5, the Purchaser
Representative shall have the right to obtain injunctive relief in respect of
any such violation.
9. TERMINATION; AMENDMENT; WAIVER
9.1 Termination. This Agreement may be terminated and the Redemption and
Purchase may be abandoned at any time prior to the Closing;
(a) by written consent of the Purchaser Representative and each
Primary Stockholder; or
(b) by the Primary Stockholders if the parties providing the
Financing shall not have provided, on or before June 27, 1997, a written
commitment, in form and substance as to the commitment itself and not as to the
terms of the financing (subject to Section 6.5(b)) reasonably satisfactory to
the Primary Stockholders, to consummate the Financing on or before June 30,
1997; or
(c) by the Purchaser Representative, the Primary Stockholders or
Holdings if the Closing shall not have occurred on or before June 30, 1997;
provided, however, that the right to terminate this Agreement under this Section
9.1(c) shall not be available to any party whose failure to fulfill any
obligation under this Agreement has been the cause of, or resulted in, the
failure of the Closing to occur on or before such date.
9.2 Effect of Termination. In the event of the termination and abandonment
of this Agreement pursuant to Section 9.1 hereof, this Agreement shall forthwith
become void and have no effect, without any liability on the part of any party
or its directors, officers, partners or stockholders, other than as set forth in
Sections 6.8, 6.10 and 8.2 above.
44
9.3 Amendment and Waivers. This Agreement may be amended and any provision
hereof may be waived by Holdings (but in either case only with the consent of
the Purchaser Representative) and the Primary Stockholders at any time by
execution of a written instrument signed on behalf of such parties and upon
notice to any other Redeeming Stockholders and Selling Warrantholders; provided
that, notwithstanding the provisions of this Section 9.3, upon receipt of such
notice, any other Redeeming Stockholder or Selling Warrantholder may terminate
its obligations hereunder in accordance with the terms of its Joinder Agreement.
9.4 Extension; Waiver. At any time prior to the Closing, the parties may
(i) extend the time for the performance of any of the obligations to other acts
of the other party hereto, (ii) waive any inaccuracies in the representations
and warranties continue herein or in any document, certificate or writing
delivered pursuant hereto or (iii) waive compliance with any of the agreements
or conditions contained herein. Any agreement on the part of any party to any
such extension or waiver shall be valid only if set forth in an instrument in
writing signed on behalf of such party.
10. MISCELLANEOUS
10.1 Notices. Any notice, request, instruction, or other communication to
be given hereunder by any party to another shall be in writing and shall be
deemed to have been duly given if delivered by hand or sent by telecopier
(transmission confirmed), certified or registered mail (return receipt
requested), postage prepaid, or by overnight express service, addressed to the
respective party or parties at the following addresses:
45
If to the Non-Redeeming Stockholders and Non-Selling Warrantholders:
Xxxxxxx X. Xxxxxxxx, as
Purchaser Representative
c/o Roller Bearing Holding Company, Inc.
00 Xxxxx Xxxx Xxxx
P.O. Box 430
Fairfield, Connecticut 06430-0430
Telecopier: 000-000-0000
with a copy (which shall
not constitute notice) to: C. Xxxxx Xxxxxxx, Esq.
XxXxxxxxx, Will & Xxxxx
00 Xxxxxxxxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telecopier: 000 000-0000
If to Holdings: Roller Bearing Holding Company, Inc.
00 Xxxxx Xxxx Xxxx
P.O. Box 430
Fairfield, Connecticut 06430-0430
Telecopier: 000-000-0000
Attention: Xxxxxxx X. Xxxxxxxx
with a copy (which shall
not constitute notice) to: C. Xxxxx Xxxxxxx, Esq.
XxXxxxxxx, Will & Xxxxx
00 Xxxxxxxxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telecopier: 000-000-0000
and Xxxxx X. Xxxxx, Esq.
Xxxxxx, Xxxx & Xxxxxxxx LLP
000 Xxxxx Xxxxx Xxxxxx
Xxx Xxxxxxx, XX 00000
Telecopier: 000-000-0000
If to the Primary
Stockholders: c/o Aurora Capital Partners, L.P.
0000 Xxxxxxx Xxxx Xxxx
Xxxxx 0000
Xxx Xxxxxxx, XX 00000
Telecopier: 310-277-5591
Attention: Xxxxxxx X. Xxxxxx
46
with a copy (which shall
not constitute notice) to: Xxxxx X. Xxxxx, Esq.
Xxxxxx, Xxxx & Xxxxxxxx LLP
000 Xxxxx Xxxxx Xxxxxx
Xxx Xxxxxxx, XX 00000
Telecopier: 000-000-0000
and to any other Redeeming Stockholder or Selling Warrantholder at such address
for notice as may be set forth in the Joinder Agreement executed by such
Redeeming Stockholder or Selling Warrantholder or to such other address or
addresses as any party may designate to the others by like notice as set forth
above. Any notice given hereunder shall be deemed given and received on the date
of hand delivery or transmission by telecopier, or three (3) days after mailing
by certified or registered mail or one (1) day after delivery to an overnight
express service for next day delivery, as the case may be.
10.2 Further Assurances. At any time and from time to time after the
Closing, at the request of any party and without further consideration, the
other parties hereto shall execute and deliver such other instruments of sale,
conveyance, transfer, lease, assignment, assumption and confirmation, and take
such other action, as the requesting party may reasonably deem necessary or
desirable, in order to carry out and implement more effectively the provisions
and purposes of this Agreement.
10.3 Entire Agreement. This Agreement (including the Schedules and the
Exhibits hereto) contains the entire agreement between the parties with respect
to the transactions contemplated hereby. There are no agreements,
representations, warranties or covenants with respect to the transactions
contemplated herein other than those expressly set forth or
47
referred to herein. This Agreement supersedes all prior agreements and
understandings between the parties hereto, whether written or oral, express or
implied, with respect to the subject matter herein.
10.4 Captions. The captions of the various Articles, Sections and
Schedules of this Agreement have been inserted only for convenience of reference
and shall not be deemed to modify, explain, enlarge or restrict any provision of
this Agreement or affect the construction hereof.
10.5 No Third Party Beneficiary. Except as otherwise specifically set
forth herein, nothing expressed or implied in this Agreement is intended, or
shall be construed, to confer upon or give any person other than the parties
hereto and their respective heirs, personal representatives, legal
representatives, and successors, any rights or remedies under or by reason of
this Agreement.
10.6 Remedies Cumulative. No remedy made available by any of the
provisions of this Agreement is intended to be exclusive of any other remedy,
and each and every remedy shall be cumulative and shall be in addition to every
other remedy given hereunder or now or hereafter existing at law or in equity.
10.7 Dispute Resolution. Any controversy or claim arising out of or
relating to this Agreement or any Related Agreement shall be resolved by
arbitration in New York, New York, in accordance with the rules of the American
Arbitration Association then in effect and judgment upon such award rendered by
the arbitrator may be entered in any court. The arbitrator shall be determined
by the mutual agreement of Primary Stockholders, on the one hand, and the
Purchaser Representative, on the other hand. In the event Primary
48
Stockholders and the Purchaser Representative are unable to agree on an
arbitrator, the Primary Stockholders shall appoint an arbitrator and the
Purchaser Representative shall appoint one arbitrator and the two arbitrators so
chosen shall appoint a third, neutral arbitrator. Each party shall pay its own
expenses of arbitration and the expenses of the arbitrator shall be shared
equally; provided, however, that the arbitrator may assess as part of the award,
all or any part of the arbitration expenses (including reasonable attorneys'
fees) of the prevailing party against the losing party.
10.8 Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED AND
ENFORCED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF DELAWARE, WITHOUT
REGARD TO CONFLICT OF LAWS OF SUCH STATE.
10.9 Assignment. Neither this Agreement nor any of the rights, interests
or obligations hereunder shall be assigned by any of the parties hereto (whether
by operation of law or otherwise) without the prior written consent of the other
parties, except that Holdings, and the Non-Redeeming Stockholders and the
Non-Selling Warrantholders may assign any or all of their rights, interests and
obligations hereunder as security for obligations to any Person providing
Financing to such parties in connection with the Redemption and Purchase and
except that Holdings or any Primary Stockholder may assign its rights under this
Agreement provided (i) that notice of such assignment is provided, as
applicable, to Holdings, the Purchaser Representative and each of the Primary
Stockholders not more than two (2) days after such assignment and (ii) that
Holdings or such Redeeming Stockholder shall not be released from any of its
obligations hereunder by reason of such assignment.
49
Subject to the preceding sentence, this Agreement will be binding upon, inure to
the benefit of and be enforceable by the parties and their respective successors
and assigns.
10.10 Expenses. All costs and expenses incurred in connection with this
Agreement and the transactions contemplated hereby shall be paid by the party
incurring such expense except to the extent otherwise provided in Section 6.8.
10.11 Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be considered one and the same agreement and
shall become effective when a counterpart has been signed by each of the parties
and delivered to the other party, it being understood that all parties need not
sign the same counterpart.
50
IN WITNESS WHEREOF, the parties hereto have executed this Redemption and
Warrant Purchase Agreement on this 20th day of May, 1997.
ROLLER BEARING HOLDING
COMPANY, INC.
By: ______________________
Name: Xxxxxxx X. Xxxxxxxx
Title: President
RBC EQUITY PARTNERS, L.P.
By: TRIBOS Management Company, Inc.,
its General Partner
By: ______________________
Xxxxxx X. Xxxxxx
President
PRBC INVESTMENT PARTNERS, L.P.
By: PRBC Management Company, Inc.,
its General Partner
By: ______________________
Xxxxxxx X. Xxxxxx
Vice President
PURCHASER REPRESENTATIVE
By: _______________________
Xxxxxxx X. Xxxxxxxx
51
AMENDMENT NO. 1
Dated as of June __, 1997
AMENDMENT by and among ROLLER BEARING HOLDING COMPANY, INC., a Delaware
corporation, CERTAIN STOCKHOLDERS OF ROLLER BEARING HOLDING COMPANY, INC. and
XXXXXXX X. XXXXXXXX, AS PURCHASER REPRESENTATIVE.
PRELIMINARY STATEMENTS:
A. The parties hereto have entered into a Redemption and Warrant Purchase
Agreement dated as of May 20, 1997 (the "Purchase Agreement"; the capitalized
terms defined therein being used herein as therein defined unless otherwise
defined herein).
B. The parties hereto have agreed to amend the Purchase Agreement as
hereinafter set forth.
SECTION 1. Amendments. The Purchase Agreement is, effective as of the date
hereof, hereby amended as follows:
(a) Section 2.1 of the Purchase Agreement is amended and restated to read
in full as follows:
2.1 Redemption. Subject to the terms and conditions contained herein, on
the Closing Date, Holdings shall purchase and the Primary Stockholders shall
deliver to Holdings in consideration for the Redemption Consideration, the
Primary Redeemed Shares (the "Primary Redemption").
(b) The form of the Holdings' Release attached to the Purchase Agreement
as Schedule 7.1(c) is hereby replaced with the form of Holdings' Release
attached hereto as Schedule 7.1(c).
SECTION 2. Reference to and Effect on the Purchase Agreement.
(a) On and after the date hereof each reference in the Purchase Agreement
to "this Agreement," "hereunder," "hereof," "herein" or words of like import and
each reference in any other document to the Purchase Agreement, shall mean and
be a reference to the Purchase Agreement as amended hereby.
(b) Except as specifically amended above, the Purchase Agreement shall
remain in full force and effect and is hereby ratified and confirmed.
IN WITNESS WHEREOF, the parties hereto have executed this Amendment as of
the date first above written.
ROLLER BEARING HOLDING
COMPANY, INC.
By: ______________________
Name: Xxxxxxx X. Xxxxxxxx
Title: President
RBC EQUITY PARTNERS, L.P.
By: TRIBOS Management Company, Inc.,
its General Partner
By: ______________________
Name:
Title:
PRBC INVESTMENT PARTNERS, L.P.
By: PRBC Management Company, Inc.,
its General Partner
By: ______________________
Name:
Title:
PURCHASER REPRESENTATIVE
By: _______________________
Xxxxxxx X. Xxxxxxxx
