EXHIBIT 7
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STOCK PURCHASE AGREEMENT
This STOCK PURCHASE AGREEMENT, dated as of September 16, 1997 (the
"Agreement"), between ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ("▇▇▇▇▇▇"), ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ FAMILY
LIMITED PARTNERSHIP (the "Partnership" and collectively with ▇▇▇▇▇▇, the
"Glazers") and SPECIALTY EQUIPMENT COMPANIES, INC., a Delaware corporation
("Company").
W I T N E S S E T H:
WHEREAS, the Board of Directors (the "Board") of the Company has determined
that it is in the best interests of the Company and its stockholders to commence
a stock repurchase plan pursuant to which the Company repurchases shares of the
Company's Common Stock, par value $.01 per share ("Common Stock"), having an
aggregate fair market value (as determined based upon the prevailing market
price on the Nasdaq National Market for a share of Common Stock at the time of
repurchase) of $10,000,000 for $10,000,000 (the "Repurchase Plan");
WHEREAS, the Glazers own beneficially and of record 40.83% (the "Applicable
Percentage") of the outstanding shares of Common Stock, such amount having been
calculated in accordance with Rule 13d-3 pursuant to the Securities Exchange Act
of 1934, as amended (the "Exchange Act");
WHEREAS, ▇▇▇▇▇▇ and his sons, Avram and ▇▇▇▇▇ ▇▇▇▇▇▇, serve on the Board of
Directors of the Company;
WHEREAS, the Company desires to make certain of the repurchases pursuant to
the Repurchase Plan through open market purchases in compliance with Rule 10b-18
under the Exchange Act;
WHEREAS, the Company and the Glazers agree that the Glazers' participation
in any open market purchases by the Company could have unintended adverse
effects on the Company, the Repurchase Plan and the Glazers; and
WHEREAS, the Glazers desire to sell shares of Common Stock in the
Repurchase Plan in an amount which would equal the Applicable Percentage of the
aggregate number of shares of Common Stock to be repurchased by the Company
pursuant to the Repurchase Plan (the "Aggregate Shares") and the Company desires
to repurchase from the Glazers such number of shares and that the purchase price
for the shares to be sold by the Glazers to the Company shall be the average
price paid by the Company for shares purchased by the Company from shareholders
other than the Glazers pursuant to the Repurchase Plan.
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A G R E E M E N T:
NOW, THEREFORE, in connection of the foregoing recitals and the mutual
covenants contained in this Agreement, and for other good and valuable
consideration, the receipt and sufficiency of which are acknowledged, the
Glazers and the Company agree as follows:
1. Sale and Purchase of Shares.
Subject to the terms and conditions of this Agreement, the Glazers shall
sell to Company and Company shall purchase from Glazers, the Applicable
Percentage of the Aggregate Shares pursuant to and in accordance with the terms
hereof. In no event may the Aggregate Shares in any event exceed a number of
shares equal to $10,000,000 divided by the average purchase price paid per share
of Common Stock paid by the Company pursuant hereto and in connection with other
purchases pursuant to the Repurchase Plan. The obligations of the Glazers
hereunder are joint and several in all respects.
2. Closings.
(a) Time and Dates. The transfer of the shares of Common stock hereunder
and payments therefore will be made at weekly closings (the "Closings") to be
held at 10 A.M. Chicago time on Tuesday of each week commencing on September 22,
1997, at the offices of Lazard Freres, or at such other time or location as
▇▇▇▇▇▇ and Company shall mutually agree. The time and date of such payment and
delivery are referred to in this Agreement as the "Closing Dates." Each such
Closing shall relate to the Applicable Number of shares of Common Stock, as
determined in accordance with Section 2(b) hereof, with the purchase price for
such shares being equal to the Applicable Aggregate Price as determined in
accordance with Section 2(b) hereof.
(b) Notices. On or before 1 p.m. Chicago time on the Monday immediately
preceding each Closing, the Company shall deliver to the Glazers a notice
specifying: (i) the number of shares purchased by the Company pursuant to the
Repurchase Plan and not made pursuant to this Agreement in the immediately
preceding calendar week ("Purchased Shares"), (ii) the average price per share
paid for such shares by the Company (the "Average Price"), (iii) Applicable
Number of shares of Common Stock and (iv) the Applicable Aggregate Price for
such shares. The "Applicable Number" shall be equal to the Applicable Percentage
of a fraction (i) the numerator of which is equal to the number of Purchased
Shares during the applicable calendar week and (ii) the denominator of which is
equal to 0.5917. The Applicable Aggregate Price shall equal the product of the
Applicable Number for such calendar week times the Average Price for such
calendar week.
(c) Payment of Purchase Price. The purchase price shall be paid to the
Glazers at each Closing with immediately available funds, by a wire transfer (to
an account specified in writing to the Company by the ▇▇▇▇▇▇'▇ not less than
forty-eight hours prior to any Closing) or by check (naming ▇▇▇▇▇▇, or such
other person as specified in writing to the
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Company by the Glazers not less than forty-eight hours prior to any Closing, as
the payee) representing good funds. At each Closing, the Glazers shall deliver
to Company stock certificates representing the shares sold pursuant to the terms
of this Agreement duly endorsed for transfer or accompanied by any necessary or
applicable stock powers executed in blank.
(d) Closing Certificate. At each Closing, the Glazers shall deliver a
certificate specifying that one or both of them are the sole and exclusive
record and beneficial owners of the shares of Common Stock to be sold (the
"▇▇▇▇▇▇ Shares"), that the seller of the ▇▇▇▇▇▇ Shares has good and marketable
title to such shares, and the absolute right, power and capacity to sell,
assign, transfer and deliver such shares to the Company free and clear of, and
the ▇▇▇▇▇▇ Shares are free and clear of, any liens, encumbrances, pledges,
security interests, restrictive agreements, transfer restrictions (other than
pursuant to applicable federal and state securities laws), voting trust
arrangements or claims of any nature whatsoever.
3. Glazers Representations. The Glazers hereby jointly and severally
represent and warrant to Company as follows:
(a) Authority. ▇▇▇▇▇▇ has full capacity, right, power and authority without
the consent of any other person, to execute and deliver this Agreement and to
carry out the transactions contemplated hereby. The Partnership has taken all
requisite partnership action and has the authority to execute and deliver this
Agreement and to carry out the transactions contemplated hereby.
(b) Ownership of Shares by ▇▇▇▇▇▇. The Glazers are the record and
beneficial owner of 7,925,532.14 shares of Common Stock including shares that
can be acquired through the exercise of a warrant to purchase shares of Common
Stock (the "Warrant"), they (individually or collectively) have good and
marketable title to all shares to be sold pursuant to this Agreement ("Such
Shares"), and the absolute right, power and capacity to sell, assign, transfer
and deliver all Such Shares to the Company free and clear of, and Such Shares
are free and clear of, any liens, encumbrances, pledges, security interests,
restrictive agreements, transfer restrictions (other than pursuant to applicable
federal and state securities laws), voting trust arrangements or claims of any
nature whatsoever.
(c) Validity. This Agreement has been duly executed and delivered by the
Glazers and is the lawful, valid and legally binding obligation of the Glazers,
enforceable in accordance with its terms, except to the extent limited by
bankruptcy, solvency, reorganization, moratorium or similar laws affecting
creditors' rights generally or by general equitable principles.
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(d) No Conflicts. Neither the execution and delivery of this Agreement nor
the Glazers' performance of their obligations hereunder will conflict with, or
result in a breach or violation of, any provision of the Partnership's
Partnership Agreement, any contract, agreement or order to which the Glazers (or
either of them) is a party or by which the Glazers (or either of them) may be
bound or any law applicable to the Glazers (or either of them).
(e) Terms of the Repurchase Plan. The Glazers acknowledge that on signing
this Agreement the Company intends to notify the Nasdaq National Market, issue a
press release announcing the intended number or value of shares it intends to
purchase and describing to the extent it believes is necessary, appropriate or
desirable the details contained in this Agreement with ▇▇▇▇▇▇; and that the open
market purchases are subject to and will be administered in accordance with Rule
10b-18 under the Exchange Act. The Glazers have reviewed with counsel Rule
10b-18 and are fully familiar with its terms and the impact which it may have
upon the Company's pursuit of the Repurchase Plan. The Glazers further
acknowledge the Company has no obligation under this Agreement to make any open
market purchases of its stock under the Repurchase Plan.
4. Company Representation. The Company hereby represents and warrants to
the Glazers as follows:
(a) Authority. The Company has taken all requisite corporate action and has
the authority to execute and deliver this Agreement and to carry out the
transactions contemplated hereby.
(b) Validity. This Agreement has been duly executed and delivered by the
Company and is the lawful, valid and legally binding obligation of Company,
enforceable in accordance with its terms, except to the extent limited by
bankruptcy, solvency, reorganization, moratorium or similar laws affecting
creditors' rights generally or by general equitable principles.
(c) No Conflicts. Neither the execution and delivery of this Agreement nor
the Company's performance of its obligations hereunder will conflict with, or
result in a breach or violation of, any provision of the Company's Certificate
of Incorporation or By-Laws, any contract, agreement or order to which the
Company is a party or by which the Company may be bound or any law applicable to
the Company.
5. ▇▇▇▇▇▇ Covenants. The Glazers, jointly and severally, hereby covenant
and agree as follows:
(a) Limitations on Other Sales by the Glazers. The Glazers each covenant
and agree that from the date hereof until the End Date (as defined below),
neither the Glazers, nor any other member of the ▇▇▇▇▇▇ Group (as defined below)
shall, directly or indirectly, sell, offer, contract to sell, make any short
sale, pledge or otherwise dispose of
Page 13 of 16 Pages
any shares of Common Stock or any securities convertible into or exchangeable
for, Common Stock or any options, warrants or rights to purchase or acquire
Common Stock (collectively a "Sale Transaction") other than pursuant to this
Agreement without first providing the Company with (i) ten (10) days' prior
written notice, (ii) a certificate (the "Certificate") in which the Glazers and
any other members of the ▇▇▇▇▇▇ Group which is a party to the proposed Sale
Transaction represent and warrant to the Company that (A) such Sale Transaction
(1) is in compliance with all applicable federal or state securities laws,
including, without limitation, Rule 10b-18 under the Exchange Act and (2) will
not result in the Company's continued consummation of the Repurchase Plan (on
terms described to the Glazers by the Company contemporaneous with the provision
of such representation) being in violation of Regulation M or Rule 10b-18 under
the Exchange Act and (B) that such representations and warranties have been made
after consultation with counsel reasonably believed by the Glazers to be expert
in federal securities law and (iii) an indemnification agreement, in form and
substance acceptable to the Glazers, the Company and their respective counsels,
pursuant to which the Glazers indemnify the Company against any losses which the
Company may suffer as a result of the falsity or incorrectness of any
representation or warranty made by the Glazers in the Certificate.,
For the purpose of this Agreement the term "End Date" shall mean the
earliest of the following: (i) the date on which the Company has repurchased
shares pursuant to the Repurchase Plan (whether pursuant hereto or otherwise)
for aggregate consideration of $10,000,000, (ii) the date on which the
Repurchase Date is terminated by the Company's Board (or any committee of the
Board with valid authority) by resolution validly adopted (provided that if the
Board passes a resolution terminating the Repurchase Plan at a later date, the
date of such termination (and not the date the resolution is passed) shall be
the applicable date) and (iii) the 46th Nasdaq National Market trading day after
the Company makes its first purchase pursuant to the Repurchase Plan. The
Company will provide the Glazers with prompt notice of the occurrence of the End
Date.
For the purposes of this Agreement the term "▇▇▇▇▇▇ Group" shall mean the
Glazers and any corporations, persons, partnerships, trusts or other entities in
which the Glazers or their affiliates (as defined under Rule 12b-2 under the
Exchange Act) own 50% or more of the equity securities that are entitled to vote
in the election of directors or persons holding similar positions.
(b) Schedule 13D Amendment. Promptly following signing this Agreement
▇▇▇▇▇▇ shall file with the Securities and Exchange Commission an amended
Schedule 13D to reflect the terms hereof.
6. Governing Law; Jurisdiction and Venue. This Agreement shall be governed
by the laws of the State of Delaware applicable in the case of contracts made
and to be performed in that state, without giving effect to any conflict of law
principles thereunder. The Glazers and the Company irrevocably agree that any
legal action or proceeding against him or it, as the case may be, with respect
to this Agreement and any transactions
Page 14 of 16 Pages
contemplated hereby shall be brought in the courts of the State of Delaware, or
of the United States of America for the District of Delaware, and by execution
and delivery of this Agreement, the Glazers and the Company irrevocably submit
to the jurisdiction of such courts.
7. Miscellaneous.
(a) Successors and Assigns. This Agreement shall be binding upon and shall
inure to the benefit of the parties and their respective successors and assigns,
provided, however, that neither this Agreement, nor any right hereunder, may be
assigned by any party without the consent of the other party hereto.
(b) Entire Agreement; Amendment. This Agreement, including the recitals
hereto, and the other instruments referred to herein embody the entire agreement
of the parties hereto with respect to the subject matter hereof and supersede
all prior agreements with respect thereto. This Agreement may be amended, and
any provision hereof waived, but only in a writing signed by the party against
whom such amendment or waiver is sought to be enforced.
(c) Counterparts. This Agreement may be executed in two or more
counterparts, all of which taken together shall constitute one and the same
instrument.
(d) Severability. Any term or provision of this Agreement which is invalid
or unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such invalidity or enforceability without rendering
invalid or unenforceable the remaining terms and provisions of this Agreement,
or affecting the validity or enforceability of any of the terms or provisions of
this Agreement in any other jurisdiction.
(e) Captions. The captions herein are inserted for convenience of reference
only and shall be ignored in the construction or interpretation hereof.
(f) Termination. The obligations of the parties hereunder shall terminate
on the End Date; provided, however, that (i) the termination shall in no way
effect the validity of any purchase and sale of Common Stock pursuant hereto
prior to such termination and (ii) (1) all representations and warranties made
hereunder and in any certificate delivered in connection herewith and (2) all
indemnity rights and obligations provided in connection with Section 5(a) hereof
shall survive such termination.
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IN WITNESS WHEREOF, this Agreement has been executed by the parties hereto
as of the date first above written.
COMPANY:
SPECIALTY EQUIPMENT COMPANIES, INC.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
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Its: Executive Vice President
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GLAZERS:
/s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
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▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ FAMILY LIMITED
PARTNERSHIP
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
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Its: Trustee
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