EXHIBIT 10.24
EXECUTION COPY
SUBSCRIPTION AGREEMENT
SUBSCRIPTION AGREEMENT, dated as of December 23, 2004 (this
"Agreement"), between Xxxxxxx X. Way (the "Director Investor") and CSA
ACQUISITION CORP., a Delaware corporation (the "Company").
WHEREAS, pursuant to that certain Stock Purchase Agreement, dated as
of September 16, 2004, as amended as of December 3, 2004 (the "Purchase
Agreement"), by and among Xxxxxx Tire & Rubber Company, a Delaware corporation
("Cooper"), Xxxxxx Tyre & Rubber Company UK Limited, a company organized under
the laws of England and Wales (together with Cooper, the "Sellers") and the
Company, the Company will purchase equity interests held by the Sellers in the
Sold Companies (the "Transaction"); and
WHEREAS, on the terms and subject to the conditions set forth below,
the Director Investor desires to subscribe for and acquire from the Company, and
the Company desires to issue and sell to the Director Investor, the number of
shares of common stock, par value $0.01 per share (the "Common Stock"), of the
Company set forth herein.
NOW, THEREFORE, in consideration of the mutual promises and agreements
set forth herein, the adequacy of which are hereby acknowledged, the parties
hereto agree as follows:
1. Definitions. Capitalized terms used and not defined herein shall
have the meaning assigned to such terms in the Purchase Agreement. As used in
this Agreement, the following terms shall have the meanings set forth below:
"Affiliate" of any Person means any other Person directly or
indirectly controlling, controlled by or under common control with such
Person. The term "control" means, with respect to any Person, the power to
direct or cause the direction of the management or policies of such Person,
directly or indirectly, whether through the ownership of voting securities,
by contract or otherwise; and the terms "controlling" and "controlled" have
meanings correlative to the foregoing.
"Agreement" has the meaning set forth in the preamble hereto.
"Business Day" means any day other than a Saturday, Sunday or day on
which commercial banks in New York, New York are authorized or required by
law to remain closed.
"Closing" has the meaning set forth in Section 3 below.
"Closing Date" has the meaning set forth in Section 3 below.
"Common Stock" has the meaning set forth in the preamble hereto.
"Company" has the meaning set forth in the preamble hereto.
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"Xxxxxx" has the meaning assigned to such term in the preamble hereto.
"Director Investor" has the meaning assigned to such term in the
preamble hereto.
"Governmental Body" means any government or governmental or regulatory
body thereof, or political subdivision thereof, of any country or
subdivision thereof, whether international, supranational, national,
federal, state or local, or any agency or instrumentality thereof, or any
court or regulatory (including a stock exchange or other self-regulatory
body) authority or agency.
"Person" means any individual, corporation, limited liability company,
limited or general partnership, joint venture, association, joint-stock
company, trust, unincorporated organization, government or any agency or
political subdivisions thereof or any group comprised of two or more of the
foregoing.
"Purchase Agreement" has the meaning set forth in the preamble hereto.
"Purchase Price" has the meaning set forth in Section 2 below.
"Registration Rights Agreement" means the Registration Rights
Agreement, substantially in the form of Exhibit B hereto.
"Securities Act" means the Securities Act of 1933, as amended, and the
rules and regulations promulgated thereunder.
"Sellers" has the meaning assigned to such term in the preamble
hereto.
"Stockholders Agreement" means the Stockholders Agreement,
substantially in the form of Exhibit A hereto.
"Transaction" has the meaning set forth in the preamble hereto.
2. Subscription for and Purchase of the Common Stock. Pursuant to the
terms and subject to the conditions set forth in this Agreement, the Director
Investor hereby subscribes for and agrees to purchase, and the Company hereby
agrees to issue and sell to the Director Investor, on or within 90 days
following the date of consummation of the Transaction, up to 2,500 shares of
Common Stock (the "Shares") at a purchase price per share equal to $100 per
share (the "Purchase Price"). For purposes of this Agreement, the purchase price
per share shall be subject to adjustment for any stock dividends, combinations,
splits or the like subsequent to the date hereof and prior to the Closing.
3. The Closing. The closing (the "Closing") of the issuance and sale
of the Shares shall take place on a mutually agreed upon date (the "Closing Date
") on or within 90 days following the date of consummation of the Transaction
pursuant to the Purchase Agreement. The Closing shall occur at the main offices
of the Company unless an alternative location is mutually agreed upon. At the
Closing, the following shall occur:
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(a) the Director Investor shall deliver to the Company the Purchase
Price payable by delivery to the Company of such amount by wire transfer of
immediately available funds or a certified check payable to the Company as
consideration for the Shares to be issued hereunder; and
(b) the Company shall duly issue the Shares to be received by the
Director Investor, pursuant to Section, and shall deliver to the Director
Investor stock certificates representing the Shares purchased by the
Director Investor.
4. Stockholders Agreement and Registration Rights Agreement. On the
Closing Date, the Director Investor shall execute and deliver the Stockholders
Agreement and the related Registration Rights Agreement. The Shares will be
issued subject to the rights and restrictions set forth in such agreements.
5. Representations and Warranties of the Company. The Company
represents and warrants to the Director Investor as follows:
(a) (i) the Company is a corporation duly incorporated, validly
existing and in good standing under the laws of the State of Delaware and
has full corporate power and authority to execute and deliver this
Agreement and to perform its obligations hereunder, and (ii) this Agreement
has been duly authorized, executed and delivered by the Company and is
valid, binding and enforceable against the Company in accordance with its
terms;
(b) the Shares to be issued to the Director Investor pursuant to this
Agreement, when issued and delivered in accordance with the terms hereof,
will be duly and validly issued and, upon receipt by the Company of the
Purchase Price therefor, will be fully paid and nonassessable with no
personal liability attached to the ownership thereof and will not be
subject to any preemptive rights and restrictions on transfer other than
under applicable securities laws, the terms of this Agreement or the
Stockholders Agreement;
(c) the execution, delivery and performance by the Company of this
Agreement will not (i) conflict with the certificate of incorporation or
by-laws of the Company, (ii) result in any material breach of any terms or
provisions of, or constitute a material default under, any material
contract, agreement or instrument to which the Company is a party or by
which the Company is bound, (iii) violate any United States federal or
state law, rule or regulation applicable to the Company or (iv) require any
consent, waiver, approval, order, permit or authorization of, or
declaration or filing with, or notification or report to, any Governmental
Body;
(d) immediately after giving effect to the transactions pursuant to
the Purchase Agreement, including equity issued in connection therewith on
the date of the closing thereunder, the capitalization of the Company shall
be substantially as set forth on Exhibit C hereto; and
(e) the transactions contemplated by this Agreement do not violate any
"blue sky" or other securities law of any jurisdiction or require the
Company to file a registration
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statement with the SEC or apply to qualify any securities under the "blue
sky" or other securities law of any jurisdiction.
6. Representations and Warranties of the Director Investor. The
Director Investor represents and warrants to the Company as follows:
(a) (i)(x) the Director Investor is over 21 years of age, (y) the
address set forth in Section 9(a)(2) hereof is the true and correct address
and residence of the Director Investor, and (z) the Director Investor has
no current intention of becoming a resident of any other state or
jurisdiction in the foreseeable future and (ii) this Agreement has been,
duly authorized, executed and delivered by the Director Investor and is
valid, binding and enforceable against the Director Investor in accordance
with its terms;
(b) the execution, delivery and performance by the Director Investor
of this Agreement will not (i) result in any material breach of any terms
or provisions of, or constitute a material default under, any material
contract, agreement or instrument to which the Director Investor is a party
or by which the Director Investor is bound, (ii) violate any United States
federal or state law, rule or regulation applicable to the Director
Investor or (iii) except as set forth on Schedule 6(b), require any
consent, waiver, approval, order, permit or authorization of, or
declaration or filing with, or notification or report to, any Governmental
Body;
(c) the Director Investor is acquiring the Shares for investment
solely for investment for its own account and not with a view to, or for
sale in connection with, the distribution or other disposition thereof;
(d) the Director Investor has been advised by the Company that:
(i) the offer and sale of the Shares have not been registered
under the Securities Act;
(ii) there is no established market for the Shares and it is not
anticipated that there will be any public market for the
Shares in the foreseeable future;
(iii) Rule 144 promulgated under the Securities Act is not
presently available with respect to the sale of any
securities of the Company;
(iv) when and if shares of the Shares may be disposed of without
registration under the Securities Act in reliance on Rule
144, such disposition can be made only in limited amounts in
accordance with the terms and conditions of Rule 144;
(v) if the Rule 144 exemption is not available, the offer or
sale of the Shares without registration will require
compliance with some other exemption under the Securities
Act;
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(vi) a restrictive legend in the form heretofore set forth in the
Stockholders Agreement shall be placed on the certificates
representing the Shares; and
(vii) a notation shall be made in the appropriate records of the
Company indicating that the Shares are subject to
restrictions on transfer and, if the Company should at some
time in the future engage the services of a securities
transfer agent, appropriate stop-transfer instructions will
be issued to such transfer agent with respect to the Shares.
(e) (i) the Director Investor's financial situation is such that it
can afford to bear the economic risk of holding the Shares for an
indefinite period of time, has adequate means for providing for its current
needs and personal contingencies, and can afford to suffer a complete loss
of its investment in the Shares; (ii) the Director Investor's knowledge and
experience in financial and business matters are such that it is capable of
evaluating the merits and risks of the investment in the Shares; (iii) the
Director Investor understands that the Shares are a speculative investment
which involves a high degree of risk of loss of its investment therein,
there are substantial restrictions on the transferability of the Shares,
and, on the Closing Date and for an indefinite period following the
Closing, there will be no public market for the Shares and, accordingly, it
may not be possible for the Director Investor to liquidate its investment
in case of emergency or otherwise; (iv) the Director Investor understands
and has taken cognizance of all the risk factors related to the purchase of
the Shares, and, other than as set forth in this Agreement, no
representations or warranties have been made to the Director Investor or
its representatives concerning the Shares or the Company or their prospects
or other matters; (v) the Director Investor has been given the opportunity
to examine all documents and to ask questions of, and to receive answers
from, the Company and its representatives concerning the Company and its
subsidiaries, the Transaction, the Purchase Agreement and the terms and
conditions of the purchase of the Shares and to obtain all additional
information which the Director Investor or its representatives deems
necessary; (vi) in making its decision to purchase the Shares hereby
subscribed for, the Director Investor has relied upon independent
investigations made by it and, to the extent believed by it to be
appropriate, its representatives, including its own professional,
financial, tax and other advisors; and (vii) the Director Investor is an
"accredited investor" within the meaning of Rule 501 of Regulation D under
the Securities Act.
(f) The Director Investor has an understanding of the Company and its
business. The Director Investor has been given the opportunity to obtain
any additional information or documents (and to ask questions and receive
answers about such information and documents) about the Company and its
business which the Director Investor deems necessary to evaluate the merits
and risks related to its investment in the shares of Common Stock.
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7. Covenants of the Company and the Director Investor.
(a) Further Assurances. Each of the parties shall, and shall cause
their respective Affiliates under their control to, execute such
instruments and take such action as may be reasonably required or desirable
to carry out the provisions hereof and the transactions contemplated
hereby.
8. Conditions Precedent to Closing. The obligations of the Company and
the Director Investor to consummate the Closing are subject to the satisfaction
or written waiver by both the Company and the Director Investor on or prior to
the Closing Date of the following conditions:
(i) the Transaction shall have been consummated pursuant to the
Purchase Agreement; and
(ii) no laws shall have been adopted or promulgated, and no temporary
restraining order, preliminary or permanent injunction or other
order issued by a court or other Governmental Body of competent
jurisdiction shall be in effect, having the effect of making the
purchase of the Shares by the Director Investor and the other
transactions contemplated hereby illegal or otherwise prohibiting
consummation thereof.
9. Miscellaneous.
(a) Notices. All notices and other communications required or
permitted hereunder shall be in writing and shall be deemed effectively
given: (a) upon personal delivery to the party to be notified; (b) when
sent by confirmed facsimile if sent during normal business hours of the
recipient, if not, then on the next Business Day, provided that a copy of
such notice is also sent via nationally recognized overnight courier,
specifying next day delivery, with written verification of receipt; (c)
five (5) days after having been sent by registered or certified mail,
return receipt requested, postage prepaid; or (d) one (1) Business Day
after deposit with a nationally recognized overnight courier, specifying
next day delivery, with written verification of receipt. All communications
shall be sent to such party's address as set forth below or at such other
address as the party shall have furnished to each other party in writing in
accordance with this provision:
(1) If to the Company:
CSA Acquisition Corp.
C/o The Cypress Group L.L.C.
00 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxx X. Xxxxxxxx
Telecopy: (000) 000-0000
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with copies to:
GS Capital Partners 2000, L.P.
00 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxxx Xxxxxxxxx
Telecopy: (000) 000-0000
Xxxxxxx Xxxxxxx & Xxxxxxxx LLP
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxxxx X. Xxxxxx
Telecopy: (000) 000-0000
and
Fried, Frank, Harris, Xxxxxxx & Xxxxxxxx LLP
Xxx Xxx Xxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxxx X. Xxxxxxxx
Telecopy: (000) 000-0000
(2) If to the Director Investor:
Xxxxxxx X. Way
0000 Xxxxxxx Xxxxxx Xxxxx
Xxxxxxxxxx Xxxxx, XX 00000
Telecopy: (000) 000-0000
Any party may, by notice given in accordance with this Section 9(a),
designate another address or person for receipt of notices hereunder.
(b) Amendment and Waiver.
(i) No failure or delay on the part of any party hereto in exercising
any right, power or remedy hereunder shall operate as a waiver
thereof, nor shall any single or partial exercise of any such
right, power or remedy preclude any other or further exercise
thereof or the exercise of any other right, power or remedy. The
remedies provided for herein are cumulative and are not exclusive
of any remedies that may be available to the parties hereto at
law, in equity or otherwise.
(ii) Any amendment, supplement or modification of or to any provision
of this Agreement, any waiver of any provision of this Agreement,
and any consent to any departure by any party from the terms of
any provision of this Agreement, shall be effective against a
party to this Agreement only if it is made or given in writing
and signed by such party.
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(c) Specific Performance. Each party hereto acknowledges that money
damages would not be an adequate remedy in the event that any of the
covenants or agreements in this Agreement are not performed in accordance
with its terms, and it is therefore agreed that in addition to and without
limiting any other remedy or right it may have, the non-breaching party
will have the right to an injunction, temporary restraining order or other
equitable relief in any court of competent jurisdiction enjoining any such
breach and enforcing specifically the terms and provisions hereof.
(d) Headings. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.
(e) Severability. Whenever possible, each provision of this Agreement
shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Agreement is held to be
invalid, illegal or unenforceable in any respect under any applicable law
or rule in any jurisdiction, such invalidity, illegality or
unenforceability shall not affect any other provision or any other
jurisdiction, but this Agreement shall be reformed, construed and enforced
in such jurisdiction as if such invalid, illegal or unenforceable provision
had never been contained herein.
(f) Entire Agreement. Except as otherwise expressly set forth herein,
this Agreement together with the Stockholder Agreement and the Registration
Rights Agreement embodies the complete agreement and understanding among
the parties hereto with respect to the subject matter hereof and supersedes
and preempts any prior understandings, agreements or representations by or
among the parties, written or oral, that may have related to the subject
matter hereof in any way.
(g) Expenses. Each of the parties hereto shall bear its own expenses
(including fees and disbursements of counsel, accountants and other
experts) incurred by it in connection with the preparation, negotiation,
execution, delivery and performance hereof, each of the other documents and
instruments executed in connection herewith or contemplated hereby and the
consummation of the transactions contemplated hereby and thereby.
(h) GOVERNING LAW; JURISDICTION; WAIVER OF JURY TRIAL. THIS AGREEMENT
SHALL BE GOVERNED AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
NEW YORK APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED ENTIRELY WITHIN
SUCH STATE. Any claim arising out of or relating to this Agreement may be
instituted in Federal or State court in the State of New York (unless
personal or subject matter jurisdiction cannot be obtained therein), and
each party agrees not to assert, by way of motion, as a defense or
otherwise, in any such claim, that it is not subject personally to the
jurisdiction of such court, that the claim is brought in an inconvenient
forum, that the venue of the claim is improper or that this Agreement or
the subject matter hereof may not be enforced in or by such court. Each
party further irrevocably submits to the jurisdiction of such courts in any
such claim. Any and all service of process and any other notice in any such
claim shall be effective against any party if given personally or by
registered or certified mail, return receipt requested, or by
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any other means of mail that requires a signed receipt, postage prepaid,
mailed to such party as herein provided. Nothing herein contained shall be
deemed to affect the right of any party to serve process in any manner
permitted by law or to commence legal proceedings or otherwise against any
other party in any other jurisdiction.
(i) No Recourse. Notwithstanding anything else that may be expressed
or implied in this Agreement, the Director Investor hereby covenants,
agrees and acknowledges that no recourse under this Agreement or any
documents or instruments delivered in connection with this Agreement or any
of the transactions contemplated hereby shall be had against any current or
future director, officer, employee, general or limited partner, member or
Affiliate (including The Cypress Group L.L.C. and GS Capital Partners 2000,
L.P.) of the Company or of any of the foregoing, whether by the enforcement
of any assessment or by any legal or equitable proceeding, or by virtue of
any statute, regulation or other applicable law, it being expressly agreed
and acknowledged that no personal liability whatsoever shall attach to, be
imposed on or otherwise be incurred by any current or future officer, agent
or employee of the Company or any current or future stockholder of the
Company or any current or future director, officer, employee, general or
limited partner, member or Affiliate (including The Cypress Group L.L.C.
and GS Capital Partners 2000, L.P.) of any of the foregoing, as such, for
any obligation of the Company under this Agreement or any documents or
instruments delivered in connection with this Agreement or any of the
transactions contemplated hereby or for any claim based on, in respect of
or by reason of such obligations of the Company.
(j) Successors and Assigns. This Agreement shall be binding upon and
inure to the benefit of the parties and their respective permitted
successors and assigns, including Permitted Transferees (as defined in the
Stockholders Agreement) of the Director Investor. Unless otherwise
specifically provided for herein, this Agreement is not assignable.
(k) Counterparts; Facsimile Signatures. This Agreement may be executed
in any number of counterparts, each of which shall be an original, but all
of which together shall constitute one instrument. This Agreement may be
executed by facsimile signature(s).
[Remainder of page left intentionally blank]
IN WITNESS WHEREOF, the undersigned have executed, or have caused to
be executed, this Agreement on the date first written above.
CSA ACQUISITION CORP.
By: /s/ Xxxxx X. Xxxxxxxx
------------------------------------
Name: Xxxxx X. Xxxxxxxx
Title: Vice President
/s/ Xxxxxxx X. Way
----------------------------------------
Xxxxxxx X. Way
Way Subscription Agreement
EXHIBIT C
POST-TRANSACTION CAPITALIZATION
OF CSA ACQUISITION CORP.
PRO FORMA COMMON
STOCK OWNERSHIP AS OF SHARES
STOCKHOLDER DECEMBER 23, 2004 SUBSCRIBED FOR*
----------- --------------------- ---------------
Cypress Merchant Banking Partners II L.P. 1,508,152.1964 0
Cypress Merchant B II C.V. 64,113.9394 0
00xx Xxxxxx Partners II L.P. 14,553.8642 0
Cypress Side-by-Side LLC 3,180 0
GS Capital Partners 2000, L.P. 899,797 0
GS Capital Partners 2000 Offshore, L.P. 326,952 0
GS Capital Partners 2000 GmbH & Co. Beteiligungs KG 37,609 0
GS Capital Partners 2000 Employee Fund, L.P. 285,892 0
Xxxxxxx Sachs Direct Investment Fund 2000, L.P. 39,750 0
Xxxxx X. XxXxxx 10,000 12,000**
X.X. Xxxxxxx 2,000 3,000
Xxxxxxx X. Way 2,500 0
Xxxxx X. Xxxxx 0 3,227.725
Xxxxx X. Xxxxxxxx 0 3,038.985
Xxxx X. Xxxxxxx 0 3,009.07
Xxxxxx X. Xxxxxx 0 2,709.33
Xxxx X. Xxxxxxxx 0 3,029.93
Xxxxx X. Xxxxx 0 3,454.03
Xxxxxxx X. Xxxxxxxx 0 2,598.83
Xxxxx X. Xxxxx 0 1,024.77
* Shares referred to in this column will be purchased after the date hereof
pursuant to Subscription Agreements entered into as of the date hereof.
** Stockholder may purchase up to this amount under his Subscription
Agreement.
