EXHIBIT 10.12
STOCK SUBSCRIPTION AGREEMENT
THIS STOCK SUBSCRIPTION AGREEMENT (the "Subscription Agreement") is made as
of this 7th day of April 1998 by and among:
RIVER HOLDING CORP., a corporation organized and existing under the
laws of the State of Delaware (the "Company"); and
The investors set forth on Schedule 1 hereto (collectively, the
"Investors") who are subscribing for and purchasing the number of
Common Shares, par value $ .01 per share (the "Shares"), set forth
opposite such Investor's name on Schedule 1.
1. Subscription of Shares.
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1.1 Subscriptions. Upon the terms and subject to the conditions of this
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Subscription Agreement, each Investor hereby subscribes for the number of Shares
set forth opposite such Investor's name on Schedule 1, for a purchase price of
$10.00 per share, for the aggregate purchase price set forth opposite such
Investor's name on Schedule 1.
1.2 Closing. Upon the terms and subject to the conditions of this
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Agreement, the closing (the "Closing") of the transactions contemplated by this
Subscription Agreement shall take place at the same time and place and
substantially concurrently with the closing under the Amended and Restated
Merger Agreement dated as of March 15, 1998, by and among the Company, River
Acquisition Corp., a California corporation, Hudson Respiratory Care Inc., a
California corporation ("Hudson RCI") and the Shareholders of Hudson RCI (the
"Merger Agreement"). The only conditions to the Closing under this Subscription
Agreement shall be the substantially concurrent satisfaction or waiver of the
conditions to closing of the transactions contemplated by the Merger Agreement.
At the Closing, the Company shall deliver to each Investor a certificate for
the number of Shares set forth opposite such Investor's name on Schedule 1 duly
registered in the name of such Investor.
1.3 Payment by the Investors. At the Closing, the Investors shall pay the
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purchase price, in the respective amounts set forth in Schedule 1, by wire
transfer to an account designated by Freeman Spogli & Co. Incorporated for that
purpose (which account may be an account in the name of the Company, or the
paying agent in connection with the Merger).
2. Representations and Warranties of the Investors.
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2.1 Investment Representation. Each of the Investors hereby severally
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(and not jointly and severally) represents and warrants to the Company with
respect to itself as follows: (a) Investor is acquiring the Shares for its own
account and not with a view to or for sale in connection with any distribution
of the Shares; (b) Investor (i) is familiar with the business of the
Company and Hudson RCI, (ii) has had an opportunity to discuss with
representatives of the Company and Hudson RCI the condition of any prospects for
the continued operation and financing of the Company and Hudson RCI and such
other matters as Investor has deemed appropriate in considering whether to
invest in the Shares, and (iii) has been provided access to all available
information about the Company and Hudson RCI requested by Investor; and (c)
Investor understands that the Shares have not been registered under the
Securities Act of 1933, as amended (the "Act"), or registered or qualified under
the securities laws of any state and that Investor may not sell or otherwise
transfer the Shares unless they are subsequently registered under the Act and
registered or qualified under applicable state securities laws, or unless an
exemption is available which permits sale or other transfer without such
registration and qualification.
2.2 Indemnification of the Company. Each Investor, severally and not
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jointly and severally, hereby agrees to indemnify, defend and hold harmless the
Company (including its officers, directors, assigns and successors) from and
against any and all claims, actions, deficiencies, assessments, liabilities,
losses, damages, costs, expenses, judgments and settlements, including
reasonable legal fees, of any kind (collectively, "Claims") relating to or
arising out of or in connection with or incidental to any breach of any
representation or warranty of an Investor under this Subscription Agreement.
3. Representations and Warranties of the Company.
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3.1 The Company represents and warrants as follows:
(a) Organization and Corporate Authority; Binding Obligation. The
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Company is a corporation duly organized, validly existing and in good standing
under the laws of Delaware, and has full corporate power and authority to
execute, deliver and perform this Agreement. The Company has all requisite
corporate power and authority to enter into this Agreement and to consummate the
transactions contemplated hereby. This Agreement has been duly authorized by
all necessary corporate action and constitutes (or upon execution and delivery
will constitute) a legal, valid and binding obligation of the Company,
enforceable against it in accordance with its terms, except as enforcement may
be limited by equitable principles or by bankruptcy, insolvency, reorganization,
moratorium or similar laws relating to creditors' rights generally.
(b) Agreement not a Breach. The execution of this Agreement by the
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Company and the fulfillment, performance and compliance with the terms and
provisions of this Agreement by the Company will not (i) conflict with or result
in a breach of any provision of the Company's Certificate of Incorporation or
Bylaws; (ii) conflict with, violate or result in a breach of the terms,
conditions or provisions of, or constitute a default or result in the
acceleration of any obligation under, or result in the cancelation or
modification of, or permit termination of, any material agreement or instrument
to which the Company is a party or by which the Company is bound; or (iii)
conflict with or violate the provisions of any law or any judgment, decree,
order, regulation, arbitration award or rule of any court or governmental
authority or any covenant or
2.
restriction binding upon the Company, including, without limitation, the
Certificate of Incorporation.
3.2 Indemnification. The Company hereby agrees to indemnify, defend and
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hold harmless each Investor (including their respective officers, directors,
partners, representatives, employees, assigns and successors and affiliates)
from and against any and all claims, actions, deficiencies, assessments,
liabilities, losses, damages, costs, expenses, judgments and settlements,
including reasonable legal fees, of any kind (collectively, "Claims") relating
to or arising out of or in connection with or incidental to (i) any breach of
any representation or warranty of the Company under this Subscription Agreement,
and (ii) any liability that an Investor may incur, or litigation or Claims
relating to, Investor's status as a stockholder of the Company or its successors
or assigns (including litigation that Investors may be made party to as a result
of their ownership of Common Stock or other securities of the Company, or its
successors and assigns). Upon any liquidation of Company as contemplated by
Section 7.4 of the Shareholders Agreement dated as of April 7, 1998, this
Agreement and the obligations of the Company to the Investors shall become
obligations of Hudson RCI (or any successor) to the Investor.
4. Miscellaneous.
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4.1 Legends on Certificates. Any and all certificates now or hereafter
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issued evidencing the Shares shall have endorsed upon them a legend such legends
and shall be subject to such restrictions on transfer as may be necessary to
comply with all applicable federal and state securities laws and regulations.
4.2 Further Assurances. Each party hereto agrees to perform any further
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acts and execute and deliver any document which may be reasonably necessary to
carry out the intent of this Agreement.
4.3 Binding Agreement. This Agreement shall bind and inure to the benefit
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of the successors and assigns of the Company and successors and assigns of the
Investors.
4.4 Notices. Any notice required or permitted to be given pursuant to
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this Agreement shall be in writing and shall be deemed given upon personal
delivery or, if mailed, upon the expiration of 48 hours after mailing by any
form of United States mail requiring a return receipt, addressed (i) to Investor
at the address set forth on the signature page hereof, (ii) to the Company at
599 Lexington Avenue, New York, New York. A party may change its address by
giving written notice to the other parties setting forth the new address for the
giving of notices pursuant to this Agreement.
4.5 Amendments. This Agreement may be amended at any time by the written
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agreement and consent of the parties hereof.
3.
4.6 Governing Law. This Agreement shall be governed by and construed in
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accordance with the laws of the State of Delaware.
4.7 Disputes. In the event of any dispute among the parties arising out
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of this Agreement, the prevailing party shall be entitled to recover from the
nonprevailing party the reasonable expenses of the prevailing party, including,
without limitation, reasonable attorneys' fees.
4.8 Entire Agreement. This Agreement, including the agreements referred
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to herein, constitutes the entire agreement and understanding among the parties
pertaining to the subject matter hereof and supersedes any and all prior
agreements, whether written or oral, relating thereto.
4.9 Headings. Introductory headings at the beginning of each section of
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this Agreement are solely for the convenience of the parties and shall not be
deemed to be a limitation upon or description of the contents of any such
section.
4.10 Counterparts. This Agreement may be executed in two or more
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counterparts, all of which, when taken together, shall constitute one and the
same instrument.
4.
IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement as
of the day and year first above written.
RIVER HOLDING CORP.
By: /s/ Charles P. Rullman
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Charles P. Rullman
Its: President
FS EQUITY PARTNERS III, L.P.
By: FS Capital Partners, L.P.
Its: General Partner
By: FS Holdings, Inc.
Its: General Partner
By: /s/ Charles P. Rullman
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Charles P. Rullman
Its:
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FS EQUITY PARTNERS IV, L.P.
By: FS Capital Partners LLC
Its: General Partner
By: /s/ Charles P. Rullman
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Charles P. Rullman
Its: Managing Member
FS EQUITY PARTNERS INTERNATIONAL, L.P.
By: FS & Co. International, L.P.
Its: General Partner
By: FS International Holdings Limited
Its: General Partner
By: /s/ Charles P. Rullman
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Charles P. Rullman
Its:
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