EXHIBIT 10(Q)
SHARE REPURCHASE AGREEMENT
This Share Repurchase Agreement is made as of June 22, 1995
by and among James C. Levinson and Marilyn Gasche Levinson
(collectively, the Levinsons ); the J. and L. Levinson
Partnership, a Texas general partnership (the "Seller"); and
Autoclave Engineers, Inc., a Pennsylvania corporation (the
Company").
FACTS:
The Seller is the owner of shares of Common Stock, $.15 par
value, of the Company (the "Common Stock"). The Levinsons are the
sole partners of the Seller.
The Seller desires to sell, and the Company desires to buy,
shares of Common Stock owned by the Seller on the terms and
conditions set forth in this Agreement, in such amount as is set
forth on Exhibit A hereto (the "Seller Shares").
The Seller and the Levinsons are willing to agree to refrain
from making certain transfers of shares of Common Stock.
The Company is willing to register the shares of Common
Stock owned by the Seller under the Securities Act of 1933
(together with the rules and regulations thereunder, the
Securities Act ) under certain circumstances.
The Company has received a favorable opinion from its
investment banker, Needham & Co. Inc., with respect to the
fairness to the Company from a financial point of view of the
transactions contemplated by this Agreement.
In consideration of the covenants and conditions set forth
in this Agreement, each of the parties agrees as follows:
1. Sale of Seller Shares. The Seller agrees to sell,
transfer and assign to the Company and, subject to and in
reliance upon the representations, warranties, terms and
conditions of this Agreement, the Company agrees to purchase, the
Seller Shares at the purchase price set forth on Exhibit A
hereto.
2. Closing. The closing of the purchase and sale of the
Seller Shares (the "Closing") shall be held concurrently with,
and is contingent upon, the closing of the sale of the assets of
the Company s AEG Division as a separate business (the AEG
Sale ); provided, however, that (i) if the sale of the AEG
Division occurs in connection with the sale of substantially all
of the assets of the Company to or merger of the Company with one
or more unaffiliated third parties, or (ii) if at the time of the
closing of the AEG Sale, the Company has entered into a letter of
intent, agreement in principle or agreement for the sale of
substantially all of the remaining assets of the Company or the
sale of the business of the Company through a merger with an
-2-
unaffiliated party, then, in either case, this Agreement shall
terminate immediately prior to the sale of the AEG Division and
no party hereto shall have any obligation to the others with
respect to the Seller Shares. At the Closing, the Seller will
deliver to the Company a duly executed stock power and a
certificate representing the Seller Shares against payment of the
purchase price therefor by delivery of a certified check to the
Seller. It shall be a condition of the Company s obligation to
close the purchase of the Seller Shares that the AEG Sale shall
have been completed for gross cash proceeds to the Company of at
least $10,500,000.00 and that no litigation with respect to the
transactions contemplated by this Agreement shall have been
commenced or threatened in writing against the Company or members
of the Company s Board of Directors. This Agreement may be
terminated by the Seller and the Levinsons by written notice to
the Company if the AEG Sale is not consummated within 180 days
after the date hereof. This Agreement may be terminated by the
Company by giving written notice to the Levinsons if the AEG Sale
is not consummated within 365 days after the date hereof.
3. Representations and Warranties of the Levinsons and the
Seller. The Levinsons and the Seller represent and warrant as
follows:
(a) Ownership of Stock. The Seller is the sole record
and beneficial owner of, and has good and marketable title to,
the Seller Shares indicated on Exhibit A, free and clear of any
liens, encumbrances, claims, charges, options, voting agreements
and restrictions of any nature, other than restrictions generally
imposed under state and federal securities laws (collectively,
"Encumbrances"). Upon the delivery of the Seller Shares to the
Company as provided in Section 2 above, the Company will receive
good and marketable title to the Seller Shares free and clear of
any and all Encumbrances.
(b) Enforceability of Agreement. This Agreement has
been duly executed and delivered by each of the Levinsons and the
Seller and is enforceable against them in accordance with its
terms.
(c) No Brokers or Finders. No person has or will
have, as a result of the transactions contemplated by this
Agreement, any right, interest or valid claim against or upon the
Seller for any commission, fee or other compensation as a finder
or broker because of any act or omission by the Seller or the
Levinsons; and the Levinsons and the Seller agree to indemnify
and hold the Company harmless against any such commissions, fees
or other compensation arising from any such acts or omissions.
(d) Legends. Certificates representing all shares of
Common Stock owned by the Levinsons and the Seller after the date
hereof and until the expiration of the Standstill Period (as
defined below) shall bear the legends set forth on Exhibit B
hereto. The Company will promptly remove such legends upon
request after the expiration of the Standstill Period.
-3-
4. Representations and Warranties of the Company. The
Company represents and warrants as follows:
(a) Power and Authority. The Company has full power
and authority to execute, deliver and perform this Agreement and
to make this Agreement its valid and enforceable obligation.
(b) Enforceability of Agreement. The execution,
delivery and performance of this Agreement have been duly
authorized by all necessary corporate action of the Company.
This Agreement has been duly executed and delivered by the
Company and is enforceable against it in accordance with its
terms.
(c) No Conflict. The execution, delivery and
performance of this Agreement by the Company in accordance with
its terms does not and will not conflict with or result in a
breach of any terms and provisions of, or constitute a default
under, the articles of incorporation or bylaws of the Company,
any law or regulation applicable to the Company, or any agreement
or instrument to which the Company is a party or by which the
Company or its assets are bound.
(d) No Brokers or Finders. No person has or will
have, as a result of the transactions contemplated by this
Agreement, any right, interest or valid claim against or upon it
for any commission, fee, or other compensation as a finder or
broker because of any act or omission by the Company (except for
the fees owing to Needham & Company, Inc., which shall be solely
the responsibility of the Company); and the Company agrees to
indemnify and hold the other parties hereto harmless against any
such commissions, fees or other compensation arising from the
Company's acts or omissions.
5. Standstill. The Levinsons and the Seller each agree
not to sell, assign, pledge, transfer (by gift or otherwise) or
otherwise dispose of, directly or indirectly, any shares of
Common Stock whatsoever (whether now held or hereafter acquired)
and agree not to engage in any hedging transactions with respect
to the Common Stock owned by them that may directly or indirectly
have an impact on the market price of the Common Stock, in each
case during the period commencing with and including the date
hereof and ending on the close of business on the date which is
eighteen (18) months after the Closing (the "Standstill Period");
provided, however, that the prohibition contained in this
Section 5 shall not apply to:
(i) gifts in any amount in which (A) each donee agrees
with the Company in writing to be bound by the restrictions
contained in this Section 5; and (B) certificates representing
the shares received by the donee bear the legends set forth on
Exhibit B hereto;
(ii) sales made pursuant to an effective registration
statement under the Securities Act; or
-4-
(iii) lawful "private" sales in which (A) no such
shares of Common Stock are sold publicly, or pursuant to Rule 144
under the Securities Act; and (B) such sales are made solely as a
private sale pursuant to an exemption under the Securities Act
other than Rule 144; (C) the certificates representing the
shares of Common Stock acquired by the purchaser bear the legends
set forth on Exhibit B hereto; and (D) each purchaser agrees with
the Company in writing to be bound by the restrictions contained
in this Section 5.
6. Registration of the Shares; Compliance with the
Securities Act.
(a) Registration Requirements.
(1) Subject to the limitations set forth in the
remainder of this Section 6(a), the Seller may at any time
following the Standstill Period give to the Company a written
request for the registration by the Company under the Securities
Act of all or any part of the shares of Common Stock owned by it.
After the receipt of such a request, the Company shall use its
best efforts in good faith to effect promptly the registration
under the Securities Act of all such shares as to which a request
for registration has been received.
(2) The Company shall not be required to effect
more than one registration pursuant to the provisions of Section
6(a)(1). The Company shall not be required to effect any
registration pursuant to the provisions of Section 6(a)(1) if
the Seller shall have sold at least 150,000 shares of Common
Stock pursuant to an effective registration statement of the
Company filed with the Securities and Exchange Commission (the
Commission ) under the Securities Act.
(3) If the Seller requests the Company to
withdraw a registration statement requested by it and filed by
the Company under the Securities Act, the Company shall have no
further obligations under Section 6(a)(1).
(4) The Company shall not be obligated to effect
any registration pursuant to the provisions of Section 6(a)(1)
during the period commencing on the date falling 60 days prior to
the Company s estimated date of filing of, and ending 90 days
following the effective date of, any registration statement
pertaining to any registration initiated by the Company (other
than with respect to securities registered in connection with
employee benefit plans).
(5) The Company shall not be required to effect
any registration pursuant to the provisions of Section 6(a)(1)
for any 60-day period following receipt of any written request
for registration, if in the good faith judgment of the Board of
Directors of the Company, the filing of any registration
statement during such 60-day period would adversely affect a
material proposed or pending acquisition, merger or other
material corporate event to which the Company reasonably expects
to conclude.
-5-
(6) The Company shall not be required to effect
any registration pursuant to the provisions of Section 6(a)(1)
with respect to any shares of Common Stock that may be sold
pursuant to the provisions of Rule 144(k), or any rule of similar
effect, of the Commission
(7) The Seller shall not effect sales of any
securities pursuant to any registration pursuant to the
provisions of Section 6(a)(1) after receipt of notice from the
Company to suspend sales to permit the Company to correct or
update such registration statement, which the Company shall
undertake to do as soon as practicable; in such event, the period
of time described in Section 6(b)(1) shall be extended by a
period of days equal to the period such suspension is in effect.
(b) Registration Procedures.
(1) With respect to any registration statement
filed by the Company pursuant to Section 6(a)(1) (the
Registration Statement ), the Company will prepare and file with
the Commission such amendments and supplements thereto and to
the prospectus used in connection therewith as may be necessary
to comply with the Securities Act for a period of sixty (60)
days after the effective date of such Registration Statement.
After the conclusion of such 60-day period, the Seller shall not
make any sales of Common Stock pursuant to such Registration
Statement, and such Registration Statement may be withdrawn by
the Company.
(2) The Company will furnish to the Seller with
respect to the securities registered under the Registration
Statement (and to each underwriter, if any, of such securities)
such number of copies of prospectuses and preliminary
prospectuses in conformity with the requirements of the
Securities Act and such other documents as the Seller may
reasonably request, in order to facilitate the public sale or
other disposition of all or any of such securities by the Seller;
provided, however, that the obligation of the Company to deliver
copies of prospectuses or preliminary prospectuses to the Seller
shall be subject to the receipt by the Company of reasonable
assurances from the Seller that the Seller will comply with the
applicable provisions of the Securities Act and of such other
securities or blue sky laws as may be applicable in connection
with any use of such prospectuses or preliminary prospectuses;
(3) The Company will file documents required of
the Company for blue sky clearance in states specified in writing
by the Seller and will use its reasonable best efforts to obtain
all such clearances; provided, however, that the Company shall
not be required to qualify to do business or consent to service
of process in any jurisdiction in which it is not now so
qualified or has not so consented; and
-6-
(4) The Company will bear all expenses in
connection with each Registration Statement and with the
procedures specified in this Section 6(b) and the registration of
the shares pursuant to the Registration Statement, other than
fees and expenses, if any, of underwriters and of counsel or
other advisers to the Seller.
(5) In the event that any registration pursuant
to Section 6(a) involves an underwritten public offering, the
Company will execute an underwriting agreement containing
customary terms.
(6) The Company will give the Sellers, any
underwriters and their respective representatives reasonable and
customary access to the books, records and properties of the
Company and will make available its officers and representatives
to discuss the business and affairs of the Company in order to
permit the Seller and underwriter to conduct a reasonable due
diligence investigation of the Company within the meaning of the
Securities Act.
(7) The Company will use its best efforts to
furnish to the Seller and underwriter, if any, an opinion of
counsel for the Company and a cold comfort letter of its
auditors, in each case, covering matters customarily covered in
such documents in underwritten public offerings.
(8) While any Registration Statement is
effective, the Company will immediately notify the Seller of
(i) any event which could cause the Registration Statement to
contain an untrue statement, or (ii) any communication from the
Commission with respect to the Registration Statement.
(c) Indemnification. For the purpose of this
Section 6(c):
(1) The term "Selling Shareholder" shall mean the
Seller if it has sold shares of Common Stock pursuant to the
Registration Statement, and any affiliate of the Seller,
including the Levinsons;
(2) The term "Registration Statement" shall
include any preliminary prospectus, final prospectus, exhibit,
supplement or amendment included in or relating to the
Registration Statement; and
(3) The term "untrue statement" shall mean any
untrue statement or alleged untrue statement of a material fact
in the Registration Statement, or any omission or alleged
omission to state in the Registration Statement a material fact
required to be stated therein or necessary to make the statements
therein, in the light of the circumstances under which they were
made, not misleading.
-7-
The Company agrees to indemnify and hold harmless each
Selling Shareholder from and against any losses, claims, damages
or liabilities to which such Selling Shareholder may become
subject (under the Securities Act or otherwise) insofar as such
losses, claims, damages or liabilities (or actions or proceedings
in respect thereof) arise out of, or are based upon, any untrue
statement contained in the Registration Statement, and the
Company will reimburse such Selling Shareholder for any legal or
other expenses reasonably incurred in investigating, defending or
preparing to defend any such action, proceeding or claim;
provided, however, that the Company shall not be liable in any
such case to the extent that such loss, claim, damage or
liability arises out of, or is based upon, an untrue statement
made in such Registration Statement in reliance upon and in
conformity with written information furnished to the Company by
or on behalf of such Selling Shareholder specifically for use in
preparation of the Registration Statement, or the failure of such
Selling Shareholder to comply with the covenants and agreements
contained herein respecting sale of its securities.
The Seller and the Levinsons agrees to indemnify and
hold harmless the Company and (and each person, if any, who
controls the Company within the meaning of Section 15 of the
Securities Act, each officer of the Company who signs the
Registration Statement and each director of the Company) from
and against any losses, claims, damages or liabilities to which
the Company (or any such officer, director or controlling
person) may become subject (under the Securities Act or
otherwise), insofar as such losses, claims, damages or
liabilities (or actions or proceedings in respect thereof) arise
out of, or are based upon, any failure of the Seller to comply
with the covenants and agreements contained herein, or any untrue
statement contained in the Registration Statement if such untrue
statement was made in reliance upon and in conformity with
written information furnished by or on behalf of the Seller
specifically for use in preparation of the Registration
Statement, and the Seller will reimburse the Company (or such
officer, director or controlling person), as the case may be, for
any legal or other expenses reasonably incurred in investigating,
defending or preparing to defend any such action, proceeding or
claim.
Promptly after receipt by any indemnified person of a
notice of a claim or the beginning of any action in respect of
which indemnity is to be sought against an indemnifying person
pursuant to this Section 6(c), such indemnified person shall
notify the indemnifying person in writing of such claim or of the
commencement of such action, and, subject to the provisions
hereinafter stated, in case any such action shall be brought
against an indemnified person and such indemnifying person shall
have been notified thereof, such indemnifying person shall be
entitled to participate therein, and, to the extent it shall
wish, to assume the defense thereof, with counsel reasonably
satisfactory to such indemnified person. After notice from the
indemnifying person to such indemnified person of its election to
-8-
assume the defense thereof, such indemnifying person shall not be
liable to such indemnified person for any legal expenses
subsequently incurred by such indemnified person in connection
with the defense thereof, provided, however, that if there exists
or shall exist a conflict of interest that would make it
inappropriate, in the opinion of counsel to the indemnified
person, for the same counsel to represent both the indemnified
person and such indemnifying person or any affiliate or associate
thereof, the indemnified person shall be entitled to retain its
own counsel at the expense of such indemnifying person; provided,
however, that no indemnifying person shall be responsible for the
fees and expenses of more than one separate counsel for all
indemnified parties.
If the indemnification provided for in this Section 6(d) is
for any reason unavailable, then each indemnifying party shall
contribute to the amount paid or payable by the indemnified party
(including legal fees and other expenses) in proportion to their
relative fault with respect to the untrue statement or other fact
giving rise to the amount so paid or payable, determined by
reference to who supplied the information giving rise to the
untrue statement and who had the opportunity to correct the
untrue statement or to remedy any other defect, as well as other
equitable considerations, but not by reference to the indemnified
party s stock ownership in the Company.
8. Counterparts. This Agreement may be executed in
counterparts, each of which will be deemed an original but all of
which will be deemed one instrument.
9. Survival of Representations and Warranties. All
representations and warranties made in this Agreement or any
other instrument or document delivered in connection herewith,
shall survive the execution and delivery hereof.
10. Prior Agreements. This Agreement constitutes the
entire agreement between the parties with respect to its subject
matter and supersedes any prior understandings or agreements
concerning such subject matter.
11. Severability. The invalidity or unenforceability of
any provision hereof shall in no way affect the validity or
enforceability of any other provision.
12. Governing Law. This Agreement shall be governed by,
and construed in accordance with, Pennsylvania law.
13. Headings. Section headings in this Agreement are
included herein for convenience of reference only and shall not
constitute a part of the Agreement for any other purpose.
14. Amendments and Waivers. Changes in or additions to
this Agreement may be made, and compliance with any covenant or
other provision herein set forth may be omitted or waived, only
by an instrument in writing executed by all of the parties
hereto.
-9-
15. Non-Assignability. The provisions of this Agreement
are non-assignable, except that the estate of the survivor of
James C. Levinson and Marilyn Gasche Levinson shall be entitled
to the benefits of, and shall be subject to the provisions of,
this Agreement.
16. Joint and Several Obligations. The Levinsons jointly
and severally agree to cause the Seller to perform all of its
obligations hereunder, and all obligations of the Levinsons
and/or of the Seller shall be joint and several, whether so
expressed or not. The term Seller shall be deemed to include
the Levinsons if the Seller shall be dissolved or if any of the
shares of Common Stock owned by the Seller shall be distributed
to the Levinsons, but the provisions of this sentence shall not
create any duplicative obligations on the part of the Company.
17. Further Assurances. Subject to the specific terms of
this Agreement, each of the parties hereto shall make, execute,
acknowledge and deliver, such other instruments and documents,
and take all such other actions, as may be seasonably necessary
in order to effectuate the purpose of this Agreement and to
consummate the transactions contemplated hereby.
-10-
IN WITNESS WHEREOF, the parties have executed this Agreement
as of the date first above written.
AUTOCLAVE ENGINEERS, INC.
By:___________________________
Title:
THE J. AND L. LEVINSON PARTNERSHIP
By:__________________________
James C. Levinson
By:__________________________
Marilyn Gasche Levinson
_______________________________
James C. Levinson, individually
_______________________________
Marilyn Gasche Levinson, individually
EXHIBIT A
Purchase Price Total Pur-
Seller Seller Shares Per Share chase Price
------ ------------- -------------- -----------
The J. and L. Levinson 220,000 $11.75 $2,585,000
Partnership
EXHIBIT B
The shares represented by this certificate have not been
registered under the Securities Act of 1933. These shares have
been acquired for investment and not with a view to distribution
or resale, and may not be sold, mortgaged, pledged, hypothecated
or otherwise transferred without an effective registration
statement for such shares under the Securities Act of 1933, or an
opinion of Counsel for the Corporation that registration is not
required under such act.
The shares represented by this certificate are subject to
restriction on transfer contained in a Share Repurchase
Agreement, dated June 22, 1995. A copy of such agreement may be
obtained, without charge, from the Secretary of the Corporation.