EXHIBIT 10.1
STOCK PURCHASE AGREEMENT
STOCK PURCHASE AGREEMENT, dated as of October 26, 2005, by and
between WHX CS Corp., a Delaware Corporation (the "Company") and Steel Partners
II, L.P., a Delaware limited partnership ("Purchaser").
NOW, THEREFORE, the parties hereto hereby agree as follows:
Section 1. PURCHASE AND SALE OF PREFERRED STOCK.
1.1. ISSUANCE AND SALE OF SHARES. At the Closing, upon the terms and
subject to the conditions contained in this Agreement, the Company shall issue
and sell to Purchaser and Purchaser shall purchase from the Company all right,
title and interest in and to 1,000 shares (the "Shares") of Series A Preferred
Stock, par value $0.01 per share (the "Series A Preferred Stock") for a purchase
price of $5,100 per share for an aggregate purchase price of $5.1 million (the
"Purchase Price").
1.2. CLOSING. The closing of the sale and purchase of the Shares shall
take place simultaneously with the execution and delivery of this Agreement at
the offices of Xxxxxx Xxxxxxxx Frome Xxxxxxxxxx & Wolosky LLP at Park Avenue
Tower, 00 Xxxx 00xx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, on October 25, 2005, or at
such other time and place as Purchaser and the Company shall mutually agree (the
"Closing").
1.3. DELIVERIES AT THE CLOSING. At the Closing, Purchaser shall deliver
the Purchase Price to the Company by wire transfer to such account as the
Company shall designate to Purchaser prior to the Closing. At the Closing, the
Company shall deliver the certificates evidencing the Shares in the name of the
Purchaser (the "WHX CS Certificates").
Section 2. REPRESENTATIONS AND WARRANTIES OF PURCHASER.
Purchaser hereby represents and warrants to the Company as follows:
2.1. AUTHORIZATION. Purchaser has all requisite corporate power and
authority to execute, deliver and perform this Agreement and the transactions
contemplated hereby, and the execution, delivery and performance by Purchaser of
this Agreement has been duly authorized by all requisite action by Purchaser and
this Agreement, when executed and delivered by Purchaser, constitutes a valid
and binding obligation of Purchaser, enforceable against Purchaser in accordance
with its terms, subject to applicable bankruptcy, insolvency, reorganization,
fraudulent conveyance, moratorium or other similar laws affecting creditors'
rights and remedies generally, and subject, as to enforceability, to general
principles of equity (regardless of whether enforcement is sought in a
proceeding at law or in equity).
2.2. INVESTMENT REPRESENTATIONS. Purchaser hereby represents and warrants
to the Company as follows:
(a) INVESTMENT. The Shares to be acquired by Purchaser will be
acquired for investment for Purchaser's own account, not as a nominee or agent,
and not with a view to the resale or distribution thereof.
(b) ACCREDITED INVESTOR. Purchaser is an "Accredited Investor" as
that term is defined in Rule 501 of Regulation D promulgated under the
Securities Act of 1933, as amended (the "Securities Act"). Purchaser is able to
bear the economic risk of the purchase of the Shares pursuant to the terms of
this Agreement, including a complete loss of Purchaser's investment in the
Shares.
(c) RESTRICTED SHARES. Purchaser understands and agrees that, when
acquired by Purchaser pursuant to this Agreement, the Shares will be restricted
within the meaning of the Securities Act, and may not be sold, transferred or
otherwise disposed of without registration under the Securities Act or an
exemption therefrom.
(d) NO REPRESENTATION. Purchaser confirms that neither the Company
nor any agent or affiliate of the Company has made any representation or
warranty to Purchaser about the Company or the Shares other than those set forth
in this Agreement, and that Purchaser has not relied upon any other
representation or warranty, express or implied, in purchasing the Shares.
(e) FINANCIAL EXPERIENCE. The Purchaser represents that by reason of
Purchaser's business or financial experience or the business or financial
experience of Purchaser's professional advisors who are unaffiliated with and
who are not compensated by either the Company or any affiliate or selling agent
of the Company, directly or indirectly, Purchaser has the capacity to protect
Purchaser's own interests in connection with the transactions contemplated by
this Agreement.
(f) LEGEND. Purchaser understands and agrees that the certificate
evidencing the Shares shall be endorsed with the following legend:
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AND HAVE BEEN
ACQUIRED FOR INVESTMENT AND NOT WITH A VIEW TO, OR IN
CONNECTION WITH, THE SALE OR DISTRIBUTION THEREOF. NO SUCH
TRANSFER MAY BE EFFECTED WITHOUT AN EFFECTIVE REGISTRATION
STATEMENT RELATED THERETO OR AN OPINION OF COUNSEL IN A
FORM SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS
NOT REQUIRED UNDER THE SECURITIES ACT OF 1933."
(g) ACKNOWLEDGMENT. Purchaser understands that the foregoing
representations and warranties are to be relied upon by the Company as a basis
for exemption of the sale of the Shares under the Securities Act and under the
securities laws of all applicable states and for other purposes. Purchaser
warrants that the information provided to the Company is true and correct as of
the date hereof, and Purchaser agrees to advise the Company, prior to the
execution of this Agreement, of any material change in any such information.
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Section 3. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.
The Company hereby represents and warrants to Purchaser with respect to
itself and its Shares as follows:
3.1. ORGANIZATION, GOOD STANDING, CORPORATE POWER AND QUALIFICATION. The
Company is a corporation duly organized, validly existing and in good standing
under the laws of the State of Delaware. The Company has all requisite power and
authority to carry on its business as previously and presently conducted and as
proposed to be conducted. The Company is duly qualified to transact business and
is in good standing in each jurisdiction in which the failure to so qualify
would have a material adverse effect on the business, assets, liabilities,
financial condition, property or results of operations of the Company
3.2. CAPITALIZATION. The authorized capital of the Company on the date
hereof consists of 5,000 shares divided as follows:
(a) 4,000 shares of common stock, par value $0.01 per share (the
"Common Stock"), 1,000 shares of which are issued and outstanding. All of the
outstanding shares of Common Stock have been duly authorized, are fully paid and
nonassessable and were issued in compliance with all applicable federal and
state securities laws. The Company holds no treasury stock; and
(b) 1,000 shares of Series A Preferred Stock, par value $0.01 per
share, of which no shares are issued or outstanding prior to the Closing.
There are no outstanding options, warrants, rights (including conversion or
preemptive rights and rights of first refusal or similar rights) or agreements,
orally or in writing, to purchase or acquire from the Company, or to the
Company's knowledge, from any third party any shares of Common Stock or Series A
Preferred Stock, or any securities convertible into or exchangeable for shares
of Common Stock or Series A Preferred Stock.
3.3. SUBSIDIARIES. The Company is a wholly-owned subsidiary of WHX
Corporation, a Delaware Corporation and does not currently own or control,
directly or indirectly, any interest in any other corporation, partnership,
trust, joint venture, limited liability company, association, or other business
entity. The Company is not a participant in any joint venture, partnership or
similar arrangement.
3.4. AUTHORIZATION. All corporate action required to be taken by the
Company's Board of Directors and stockholders in order to authorize the Company
to enter into this Agreement, and to issue the Shares as contemplated hereunder
has been taken. All action on the part of the officers of the Company necessary
for the execution and delivery of this Agreement, the performance of all
obligations of the Company hereunder, and the issuance and delivery of the
Shares has been taken or will be taken prior to the Closing. This Agreement,
when executed and delivered by the Company, shall constitute a valid and legally
binding obligation of the Company, enforceable against the Company in accordance
with its terms, except (i) as limited by applicable bankruptcy, insolvency,
reorganization, moratorium, fraudulent conveyance or other laws of general
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application relating to or affecting the enforcement of creditors rights
generally or (ii) as limited by laws relating to the availability of specific
performance, injunctive relief, or other equitable remedies.
3.5. VALID ISSUANCE OF SHARES. The Shares, when issued, sold and delivered
in accordance with the terms and for the consideration set forth in this
Agreement, will be validly issued, fully paid and nonassessable and free of
restrictions on transfer other than restrictions on transfer under this
Agreement, applicable state and federal securities laws and liens or
encumbrances created by or imposed by a Purchaser. Assuming the accuracy of the
representations of the Purchasers in SECTION 2 of this Agreement, the Shares
will be issued in compliance with all applicable federal and state securities
laws.
3.6. COMPLIANCE WITH OTHER INSTRUMENTS. The Company is not in violation,
breach or default of any term of the Company's Certificate of Incorporation, as
amended (including the Certificate of Designations for the Series A Preferred
Stock) (the "Certificate") or the Company's bylaws (the "Bylaws") or in any
material respect of any term or provision of any material mortgage, indenture,
contract, agreement or instrument to which the Company is a party or by which it
may be bound, (the "Company Contracts") or of any provision of any foreign or
domestic state or federal judgment, decree, order, statute, rule or regulation
applicable to or binding upon the Company. The execution, delivery and
performance of and compliance with this Agreement and the consummation of the
transactions contemplated hereby will not result in any such violation, breach
or default, or be in conflict with or constitute, with or without the passage of
time or the giving of notice or both, either a default under the Certificate,
Bylaws, or any Company Contract.
Section 4. INDEMNIFICATION.
(a) The Company agrees to indemnify and hold harmless Purchaser (and
its officers, employees, partners, agents, affiliates and controlling parties)
from and against any and all losses, liabilities, damages, claims, suits,
actions, judgments or causes of action, assessments, costs and expenses,
including without limitation interest, penalties, reasonable attorneys' fees,
any and all reasonable expenses incurred in investigating, preparing or
defending against any litigation, commenced or threatened, or any claim
whatsoever, and any and all amounts paid in settlement of any claim or
litigation, asserted against, resulting to, imposed upon, or incurred or
suffered by Purchaser, directly as a result of third party claims resulting or
arising from any inaccuracy in or breach or nonfulfillment of or any alleged
inaccuracy in or breach or nonfulfillment of any of the representations,
warranties, covenants or agreements made by the Company in this Agreement,
provided, however, that the indemnity agreement contained in this SUBSECTION
4(A) shall not apply to amounts paid in settlement of any such loss, claim,
damage, liability, or action if such settlement is effected without the consent
of the Company (which consent shall not be unreasonably withheld, conditioned or
delayed).
(b) Purchaser agrees to indemnify and hold harmless the Company (and
its officers, employees, partners, agents, affiliates and controlling parties)
from and against any and all losses, liabilities, damages, claims, suits,
actions, judgments or causes of action, assessments, costs and expenses,
including without limitation interest, penalties, reasonable attorneys' fees,
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any and all reasonable expenses incurred in investigating, preparing or
defending against any litigation, commenced or threatened, or any claim
whatsoever, and any and all amounts paid in settlement of any claim or
litigation, asserted against, resulting to, imposed upon, or incurred or
suffered by such the Company directly as a result of third party claims
resulting or arising from any inaccuracy in or breach or nonfulfillment of or
any alleged inaccuracy in or breach or nonfulfillment of any of the
representations, warranties, covenants or agreements made by the Purchaser in
this Agreement.
Section 5. BROKERS AND FINDERS. No party hereto shall be obligated to pay any
commission, brokerage fee or finder's fee based on any alleged agreement or
understanding between any such party and a third person in respect of the
transactions contemplated hereby. Each party hereto hereby agrees to indemnify
the other against any claim by any third person for any commission, brokerage or
finder's fee or other payment with respect to this Agreement or the transactions
contemplated hereby based on any alleged agreement or understanding between such
party and such third person, whether express or implied from the actions of such
party.
Section 6. SUCCESSORS AND ASSIGNS.
This Agreement shall bind and inure to the benefit of the parties hereto
and their respective successors and assigns.
Section 7. ENTIRE AGREEMENT.
This Agreement, including any and all exhibits and schedules hereto,
contains the entire understanding of the parties with respect to the subject
matter hereof and supersedes all prior agreements and understandings among the
parties with respect thereto.
Section 8. NOTICES.
All notices, demands and requests of any kind to be delivered to any
party in connection with this Agreement shall be in writing and shall be deemed
to have been duly given if personally delivered or if sent by
internationally-recognized overnight courier or by registered or certified mail,
return receipt requested and postage prepaid, addressed as follows:
(a) if to Purchaser, to:
Xxxxxx Xxxxxxxxxxxx
c/o Steel Partners II, L.P.
000 Xxxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
with a copy to:
Xxxxxxx Krooks LLP
000 0xx Xxxxxx, 00xx Xxxxx
0
Xxx Xxxx, XX 00000
Telecopier: (000) 000-0000
Attention: Xxxxxxxx X. Xxxxxxx, Esq.
(b) if to the Company, to:
WHX CS Corporation
000 Xxxxxxxx Xxxxx Xxx
Xxx, Xxx Xxxx 00000
Telecopier: (000) 000-0000
Attention: Xxxxxx Xxxxx
with a copy to:
Xxxxxx Xxxxxxxx Frome Xxxxxxxxxx & Xxxxxxx LLP
00 Xxxx 00xx Xxxxxx
Xxx Xxxx, XX 00000
Telecopier: (000) 000-0000
Attention: Xxxxxx Xxxxxxx, Esq.
or to such other address as the party to whom notice is to be given may have
furnished to the other parties to this Agreement in writing in accordance with
the provisions of this Section. Any such notice or communication shall be deemed
to have been received (i) in the case of personal delivery, on the date of such
delivery, (ii) in the case of nationally-recognized overnight courier, on the
next business day after the date when sent and (iii) in the case of mailing, on
the third business day following that on which the piece of mail containing such
communication is posted.
Section 9. AMENDMENTS.
This Agreement may not be modified or amended, or any of the provisions
of this Agreement waived, except by written agreement of all parties hereto.
Section 10. GOVERNING LAW; WAIVER OF JURY TRIAL.
(a) All questions concerning the construction, interpretation and
validity of this Agreement shall be governed by and construed and enforced in
accordance with the domestic laws of the State of New York without giving effect
to any choice or conflict of law provision or rule (whether in the State of New
York or any other jurisdiction) that would cause the application of the laws of
any jurisdiction other than the State of New York. In furtherance of the
foregoing, the internal law of the State of New York will control the
interpretation and construction of this Agreement, even if under such
jurisdiction's choice of law or conflict of law analysis, the substantive law of
some other jurisdiction would ordinarily or necessarily apply.
(b) BECAUSE DISPUTES ARISING IN CONNECTION WITH COMPLEX FINANCIAL
TRANSACTIONS ARE MOST QUICKLY AND ECONOMICALLY RESOLVED BY AN EXPERIENCED AND
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EXPERT PERSON AND THE PARTIES WISH APPLICABLE LAWS TO APPLY (RATHER THAN
ARBITRATION RULES), THE PARTIES DESIRE THAT THEIR DISPUTES BE RESOLVED BY A
JUDGE APPLYING SUCH APPLICABLE LAWS. THEREFORE, TO ACHIEVE THE BEST COMBINATION
OF THE BENEFITS OF THE JUDICIAL SYSTEM AND OF ARBITRATION, THE PARTIES HERETO
WAIVE ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, SUIT OR PROCEEDING BROUGHT TO
ENFORCE OR DEFEND ANY RIGHTS OR REMEDIES UNDER THIS AGREEMENT OR ANY DOCUMENTS
RELATED HERETO.
Section 11. SUBMISSION TO JURISDICTION.
Any legal action or proceeding with respect to this Agreement may be
brought in the courts of the State of New York and the United States of America
located in the City of New York, New York and, by execution and delivery of this
Agreement, the parties hereby accept for themselves and in respect of their
properties, generally and unconditionally, the jurisdiction of the aforesaid
courts. The parties hereby irrevocably waive, in connection with any such action
or proceeding, any objection, including, without limitation, any objection to
the venue or based on the grounds of forum non conveniens, which they may now or
hereafter have to the bringing of any such action or proceeding in such
respective jurisdictions. The parties hereby irrevocably consent to the service
of process of any of the aforementioned courts in any such action or proceeding
by the mailing of copies thereof by registered or certified mail, postage
prepaid, to them at the address set forth herein.
Section 12. SEVERABILITY.
It is the desire and intent of the parties that the provisions of this
Agreement be enforced to the fullest extent permissible under the law and public
policies applied in each jurisdiction in which enforcement is sought.
Accordingly, in the event that any provision of this Agreement would be held in
any jurisdiction to be invalid, prohibited or unenforceable for any reason, such
provision, as to such jurisdiction, shall be ineffective, without invalidating
the remaining provisions of this Agreement or affecting the validity or
enforceability of such provision in any jurisdiction. Notwithstanding the
foregoing, if such provision could be more narrowly drawn so as not to be
invalid, prohibited or unenforceable in such jurisdiction, it shall, as to such
jurisdiction, be so narrowly drawn, without invalidating the remaining
provisions of this Agreement or affecting the validity or enforceability of such
provision in any other jurisdiction.
Section 13. COUNTERPARTS.
This Agreement may be executed in any number of counterparts, and each
such counterpart of this Agreement shall be deemed to be an original instrument,
but all such counterparts together shall constitute but one agreement. Facsimile
counterpart signatures to this Agreement shall be acceptable and binding.
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Section 14. HEADINGS.
The section and paragraph headings contained in this Agreement are for
reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement.
Section 15. EXPENSES.
Each party hereto shall pay its own expenses incurred in the
preparation, negotiation and execution of this Agreement and the consummation of
the transactions contemplated hereby and thereby, including without limitation
expenses for legal and accounting services.
Section 16. SURVIVAL.
The warranties, representations, and covenants of the Company and
Purchaser contained in or made pursuant to this Agreement shall survive the
execution and delivery of this Agreement and the Closing and shall in no way be
affected by any investigation of the subject matter thereof made by or on behalf
of Purchaser or the Company.
Section 17. FURTHER ASSURANCES.
From and after the date of this Agreement, the Purchaser and the
Company agree to execute and deliver any additional documents, instrument and
other writings as may be reasonably necessary to effect the transfer of the
Shares to the Purchaser, including any documents required by the Company's
transfer agent or counsel.
Section 18. PREPARATION OF AGREEMENT.
Each party to this Agreement acknowledges that: (i) the party had the
advice of, or sufficient opportunity to obtain the advice of, legal counsel
separate and independent of legal counsel for any other party hereto; (ii) the
terms of the transactions contemplated by this Agreement are fair and reasonable
to such party; and (iii) such party has voluntarily entered into the
transactions contemplated by this Agreement without duress or coercion. Each
party further acknowledges that such party was not represented by the legal
counsel of any other party hereto in connection with the transactions
contemplated by this Agreement, nor was he or it under any belief or
understanding that such legal counsel was representing his or its interests.
Each party agrees that no conflict, omission or ambiguity in this Agreement, or
the interpretation thereof, shall be presumed, implied or otherwise construed
against any other party to this Agreement on the basis that such party was
responsible for drafting this Agreement.
* * * * *
IN WITNESS WHEREOF, each of the undersigned has duly executed this
Stock Purchase Agreement as of the date first written above.
STEEL PARTNERS II, L.P.
By: Steel Partners, L.L.C.
General Partner
By: /s/
-----------------------------------
Name:
Title:
WHX CS CORP.
By: /s/
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Name:
Title:
