EXHIBIT 10.4
AMENDMENT NO. 1 TO SHAREHOLDERS' AGREEMENT
WHEREAS, Elson T. Killam Associates, Inc., a New Jersey
corporation ("Killam"), Engineering, Technology and Knowledge
Corporation, a Delaware corporation (formerly known as
Environmental, Technology and Knowledge Corporation ("ETKC"), and
certain persons (individually, a "Shareholder" and collectively,
the "Shareholders") are parties to that certain Shareholders'
Agreement dated as of the 29th day of January, 1995 (the
"Shareholders' Agreement");
WHEREAS, ETKC owns 100% of the outstanding capital stock of
Killam (the "Killam Stock") and the Shareholders collectively own
vested options (the "Killam Options") to purchase, in the
aggregate, 1,590 additional shares of Killam Stock;
WHEREAS, in the absence of any public trading market for
Killam Stock, the Shareholders' Agreement contains certain
provisions intended under certain identified circumstances to
provide the Shareholders with liquidity with respect to their
shares of Killam Stock;
WHEREAS, pursuant to a Stock Purchase and Sale Agreement of
even date herewith, Thermo Process Systems Inc., a Delaware
corporation ("Thermo"), has acquired 100% of the outstanding
capital stock of ETKC;
WHEREAS, as of the date hereof, the Killam Options (after
taking into account the cancellation of certain of the Killam
Options) have been assumed by Thermo and have been converted into
options to purchase shares of the common stock of Thermo, which
shares are listed for trading on the American Stock Exchange and
are freely tradable under U.S. securities laws in the public
securities markets; and
WHEREAS, the parties wish to clarify the Shareholders'
Agreement to establish such public markets as the means to
provide the Shareholders with the liquidity guaranteed by the
Shareholders' Agreement;
NOW, THEREFORE, in consideration of the foregoing, of the
mutual promises set forth herein, and intending to be legally
bound, the parties hereto hereby agree as follows:
1. The Shareholders' Agreement is amended by deleting
Section 1.8 thereof in its entirety and substituting therefor the
following:
"1.8 "SHARES" shall mean shares of the common stock of
Thermo Process Systems Inc. acquired upon the exercise of
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options received by the Shareholders as of February 6, 1995
(the "Thermo Options") upon the conversion of
then-outstanding options to purchase shares of the capital
stock of Killam."
2. The Shareholders' Agreement is amended by deleting
Section 2.2 thereof in its entirety and substituting therefor the
following:
"2.2 FUTURE SHARES. The Shareholders agree to be bound
by this Agreement only with respect to the Shares. This
Agreement shall not apply to any other shares of stock of
Thermo Process Systems Inc. acquired by the Shareholders."
3. The Shareholders' Agreement is amended by deleting
Article 3, Sections 4.2, 4.3, 4.4 and 4.5 and Article 7 thereof
in their entirety.
4. The Shareholders' Agreement is amended by deleting
Section 5.1 thereof in its entirety and substituting therefor the
following:
"5.1 DEATH. Upon the death of a Shareholder, the
estate or personal representative of such deceased
Shareholder may sell, transfer or otherwise dispose of any
Shares owned by such deceased Shareholder to any third party
on such terms as such estate or personal representative and
such third party may agree. Any such third party shall take
such Shares free and clear of any restriction imposed on the
Shareholder by this Agreement."
5. The Shareholders' Agreement is amended by deleting
Section 5.2 thereof in its entirety and substituting therefor the
following:
"5.2 DISABILITY. In the event that a Shareholder
becomes Disabled, such Disabled Shareholder or the legal
guardian of such Disabled Shareholder may sell, transfer or
otherwise dispose of any Shares owned by such Disabled
Shareholder to any third party on such terms as such
Disabled Shareholder or such legal guardian and such third
party may agree. Any such third party shall take such
Shares free and clear of any restriction imposed on the
Shareholder by this Agreement."
6. The Shareholders' Agreement is amended by deleting
Section 5.3 thereof in its entirety and substituting therefor the
following:
"5.3 INVOLUNTARY TERMINATION OF EMPLOYMENT. If any
Shareholder ceases to be employed by Killam, or any Related
Corporation, on account of an involuntary termination, such
Shareholder may sell, transfer or otherwise dispose of any
Shares owned by such Shareholder to any third party on such
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terms as such Shareholder and such third party may agree.
Any such third party shall take such Shares free and clear
of any restriction imposed on the Shareholder by this
Agreement."
7. The Shareholders' Agreement is amended by deleting
Section 5.4 thereof in its entirety and substituting therefor the
following:
"5.4 VOLUNTARY TERMINATION OF EMPLOYMENT. If any
Shareholder ceases to be employed by Killam, or any Related
Corporation, on account of a voluntary termination, such
Shareholder may sell, transfer or otherwise dispose of any
Shares owned by such Shareholder to any third party on such
terms as such Shareholder and such third party may agree.
Any such third party shall take such Shares free and clear
of any restriction imposed on the Shareholder by this
Agreement."
8. The Shareholders' Agreement is amended by deleting
Section 5.5 thereof in its entirety and substituting therefor the
following:
"5.5 RETIREMENT. If any Shareholder ceases to be
employed by Killam, or any Related Corporation, on account
of Retirement, such Shareholder may sell, transfer or
otherwise dispose of any Shares owned by such Shareholder to
any third party on such terms as such Shareholder and such
third party may agree. Any such third party shall take such
Shares free and clear of any restriction imposed on the
Shareholder by this Agreement."
9. The Shareholders' Agreement is amended by deleting
Section 6.1 thereof in its entirety and substituting therefor the
following:
"6.1 SALE OF SHARES. Notwithstanding the provisions
contained in Article 4, (a) on and after January 1, 1997,
each Shareholder may sell up to 25% of his Shares to any
third party on such terms as such Shareholder and such third
party may agree; (b) on and after January 1, 1998, each
Shareholder may sell up to 25% of his Shares to any third
party on such terms as such Shareholder and such third party
may agree; (c) on and after January 1, 1999 each Shareholder
may sell up to 25% of his Shares to any third party on such
terms as such Shareholder and such third party may agree;
and (d) on and after January 1, 2000 each Shareholder may
sell up to 25% of his Shares to any third party on such
terms as such Shareholder and such third party may agree;
such that beginning on January 1, 1997, each Shareholder
will have been entitled to sell one-fourth of his total
Shares on and after each such date. Any such third party
shall take such Shares free and clear of any restriction
imposed on the Shareholder by this Agreement. This Section
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6.1 shall not limit the ability of each Shareholder to sell
Shares as set forth in Article 5."
10. The Shareholders' Agreement is amended by adding the
following Section 13.11 immediately after Section 13.10:
"13.11 FLOOR PRICE ON SHARES. In the event that a
Shareholder desires to sell in the open market any or all of
his Shares at any time prior to January 29, 2002 (subject to
the resale restrictions set forth in this Agreement), but
cannot do so at prices equal to at least $8.00 per Share, as
adjusted for stock dividends, stock splits,
reclassifications and similar events (the "Floor Price"),
Killam's parent company, Thermo Process Systems Inc.
("Thermo") will either, in its discretion, buy any such
Shares that cannot be sold for at least the Floor Price for
an amount equal to the Floor Price or (ii) permit the
Shareholder to sell such Shares in the open market at such
price or prices as may be obtainable and pay to the
Shareholder an amount which is equal to the difference
between the Floor Price and the amount which such
Shareholder received (before taking into account
commissions, taxes and other transaction costs) upon such
sales. The Shareholders agree, as a condition to such
agreements by Thermo, to give Thermo reasonable prior
written notice of any such intention to sell such Shares and
to consult with Thermo as to the timing of such sales."
11. The Shareholders' Agreement is amended by adding the
following Section 13.12 immediately after Section 13.11:
"13.12 PLEDGES. Notwithstanding any other provision
of this Agreement, each Shareholder may pledge any or all of
his Shares as collateral for any loans that may be needed to
enable such Shareholder to pay any alternative minimum tax
or other income tax due as a result of the exercise of the
Thermo Options, provided, however, that any lender accepting
such Shares as collateral shall continue to be prohibited
from disposing of such Shares except in accordance with the
provisions of Section 6.1 of this Agreement."
12. Except as expressly amended hereby, the Shareholders'
Agreement shall remain in full force and effect in accordance
with the terms thereof.
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IN WITNESS WHEREOF, the parties have executed this Amendment
No. 1 as of the day and year first written above.
ELSON T. KILLAM ASSOCIATES, INC. ENGINEERING, TECHNOLOGY
AND KNOWLEDGE CORPORATION
By: /s/ Emil C. Herkert By: /s/ John P. Appleton
Printed Name: Emil C. Herkert Printed Name: John P.
Title: President Appleton
Title: President
/s/ Emil C. Herkert /s/ Kenneth L. Zippler
Emil C. Herkert Kenneth L. Zippler
/s/ Franklin O. Williamson, Jr. /s/ Fletcher N. Platt, Jr.
Franklin O. Williamson, Jr. Fletcher N. Platt,
Jr.
/s/ Eugene J. Destefano /s/ Meint Olthof
Eugene J. Destefano Meint Olthof
/s/ Stanley P. Kaltnecker, Jr.
Stanley P. Kaltnecker, Jr.
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for purposes of SectionS 10 and 11 hereof only:
THERMO PROCESS SYSTEMS INC.
By: /s/ John P. Appleton
Printed Name: John P. Appleton
Title: President