SHAREHOLDER AGREEMENT
This Shareholder Agreement, dated as of June 8, 1999 (this
"Agreement"), is made and entered into among EM Laboratories, a New
York corporation ("Parent"), EM Subsidiary, Inc., a Pennsylvania
corporation and a wholly owned subsidiary of Parent ("Sub"), and each
of the parties listed on the signature pages hereto (each a "Shareholder,"
and collectively, the "Shareholders").
WHEREAS, each of the Shareholders is, as of the date hereof,
the beneficial owner of the number of shares of common stock, par value
$1.00 per share (the "Common Stock"), of VWR Scientific Products
Corporation, a Pennsylvania corporation (the "Company"), set forth
opposite his name on Annex I hereto;
WHEREAS, concurrently herewith, Parent, Sub and the
Company have entered into an Agreement and Plan of Merger, dated as
of the date hereof (the "Merger Agreement"), which provides, upon the
terms and subject to the conditions set forth therein, for (i) the
commencement by Sub of a tender offer (the "Offer") for all of the
issued and outstanding shares of Common Stock of the Company and (ii)
the subsequent merger of Sub with and into the Company (the
"Merger");
WHEREAS, as a condition to the willingness of Parent and Sub
to enter into the Merger Agreement and in order to induce Parent and
Sub to enter into the Merger Agreement, Shareholders have agreed to
enter into this Agreement; and
WHEREAS, capitalized terms used but not defined in this
Agreement have the meaning given to those terms in the Merger
Agreement.
NOW, THEREFORE, in consideration of the execution and
delivery by Parent and Sub of the Merger Agreement and the mutual
representations, warranties, covenants and agreements set forth herein
and therein, and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, and intending to be
bound hereby, the parties hereto agree as follows:
ARTICLE I.
TENDER OF SHARES
Section 1.1. Tender. Each Shareholder hereby agrees validly
to tender his Shares (or cause the record owner of such Shares validly to
tender), and not to withdraw any Shares so tendered, promptly, and in
any event not later than the fifth business day after commencement of the
Offer pursuant to Section 1.1 of the Merger Agreement and Rule 14d-2
under the Securities Exchange Act of 1934, as amended (the "Exchange
Act"); provided, however, that in the event that the Unaffiliated Directors
(as defined in the Merger Agreement) (or any committee designated
thereby) shall withdraw, or propose publicly to withdraw, the approval or
recommendation by such Unaffiliated Directors or such committee of the
Offer, the Merger or Merger Agreement (or any transaction contemplated
thereby), each Shareholder shall have the right to withdraw any Shares so
tendered. Sub hereby agrees to purchase all the Shareholder's Shares so
tendered at the Purchase Price or any higher price that may be paid in the
Offer; provided, however, that Sub's obligation to accept for payment
and pay for the Common Stock (including the Shares) in the Offer is
subject to all the terms and conditions of the Offer set forth in the Merger
Agreement.
Section 1.2. Certain Warranties. Without limiting the
generality or effect of any other term or condition of the Offer, the
transfer by each of the Shareholders of his Shares to Sub in the Offer
shall pass to and unconditionally vest in Sub good and valid title to the
Shares, free and clear of all liens, claims, restrictions, security interests,
pledges, limitations and Encumbrances (as defined herein) whatsoever.
Section 1.3. Disclosure. Each Shareholder hereby authorizes
Parent and Sub to publish and disclose in the Offer Documents and, if
approval of the Company's shareholders is required under applicable
law, the Proxy Statement (including all documents and schedules filed
with the SEC), his identity and ownership of the Shares and the nature of
his commitments, arrangements and understandings under this
Agreement provided that each Shareholder is provided with a reasonable
opportunity to review in advance any such disclosure contained in the
Offer Documents or the Proxy Statement.
ARTICLE II.
GRANT OF PROXY
Section 2.1. Proxy. Each Shareholder hereby irrevocably
appoints Parent and Sub (and any nominee of either Parent or Sub) and
each of them, with full power of substitution and re-substitution, (i) as
proxies for such Shareholder to vote all of his Shares for and in the
name, place, and stead of such Shareholder at any meeting of the holders
of Common Stock or any adjournments or postponements thereof or
pursuant to any consent in lieu of a meeting, or otherwise, with respect
only to the approval of this Agreement, the Merger Agreement, the
Offer, the transactions contemplated by the Merger Agreement, any
matters related to or in connection with the Merger and any corporate
action, the consummation of which would violate, frustrate the purposes
of, prevent or delay the consummation of the transactions contemplated
by the Merger Agreement (including, without limitation, any proposal to
amend the Articles of Incorporation or By-laws of the Company or
approve any merger, consolidation, sale or purchase of any assets,
issuance of Common Stock or any other equity security of the Company
(or a security convertible into an equity security of the Company),
reorganization, recapitalization, liquidation, winding up of or by the
Company or any similar transaction) and (ii) as his true and lawful
attorneys-in-fact to execute one or more consents or other instruments
from time to time in order to take such actions informally without notice
of a meeting of the shareholders of the Company; provided, however,
that in the event that the Unaffiliated Directors (as defined in the Merger
Agreement) (or any committee designated thereby) shall withdraw, or
propose publicly to withdraw, the approval or recommendation by such
Unaffiliated Directors or such committee of the Offer, the Merger or
Merger Agreement (or any transaction contemplated thereby), such
appointment of Parent and Sub as proxies shall become immediately
revocable. Each Shareholder agrees that the foregoing proxy and power-
of-attorney granted to Parent and Sub (and their respective nominees) in
this subsection shall be irrevocable during the term of this Agreement
and shall be deemed to be coupled with an interest. Each Shareholder
represents that any proxies heretofore given in respect of his Shares are
not irrevocable, and that such proxies are hereby revoked.
ARTICLE III.
OPTION
Section 3.1. Grant of Option. Each Shareholder hereby
grants to Parent or Sub, as Parent may designate (each, an "Optionee"),
an irrevocable option (the "Option") to purchase the number of shares of
Common Stock opposite such Shareholder's name on Annex I hereto and
any additional shares of Common Stock acquired by such Shareholder in
any capacity (whether by exercise of options, warrants or rights, the
conversion or exchange of convertible or exchangeable securities or by
means of a purchase, distribution, dividend or otherwise) (collectively,
the "Shares") at a purchase price of $37.00 per share or such higher price
as may be paid by Parent or Sub pursuant to the Offer (the "Purchase
Price").
Section 3.2. Exercise of Option.
(a) Parent or Sub may exercise, but shall not be
required to exercise, the Option from time to time, in whole or in part, on
or after the date of the consummation of the Offer but prior to the
Effective Date if the Offer is consummated but (whether due to improper
tender or withdrawal of tender) Sub has not accepted for payment and
paid for all of a Shareholder's Shares.
(b) Parent and Sub's obligation to purchase Shares
upon exercise of the Option shall be subject to the conditions that:
(i) no preliminary or permanent injunction or other
order issued by any court or governmental, administrative or regulatory
agency or authority prohibiting the exercise of the Option pursuant to
this Agreement shall be in effect (and no action or proceeding shall have
been commenced or threatened for the purpose of obtaining such an
injunction or order);
(ii) any applicable waiting period under the Xxxx-
Xxxxx-Xxxxxx Antitrust Improvements Act of 1976, as amended (the
"HSR Act") or similar foreign law required for the purchase of the Shares
upon such exercise shall have expired; and
(iii) there shall have been no material breach of the
representations, warranties or covenants of any Shareholder contained in
this Agreement; provided, that any failure by Parent or Sub to purchase
Shares upon exercise of the Option at any Closing (as defined below) as
a result of the nonsatisfaction of any of such conditions shall not affect or
prejudice Parent or Sub's right to purchase such Shares upon the
subsequent satisfaction of such conditions.
(c) In the event that Parent or Sub, as the case may
be, wishes to exercise the Option, Parent or Sub, as the case may be,
shall send a written notice to the Shareholders specifying the total
number of such Shareholder's Shares it wishes to purchase and the place
and date for the closing of such purchase (each, a "Closing") at least
three business days prior to such Closing; and
(d) At any Closing, (i) each Shareholder shall
deliver to Parent or Sub (in accordance with Parent or Sub's instructions)
a certificate or certificates (the "Certificates") representing all of such
Shareholder's Shares being purchased by Sub at the Closing, duly
endorsed or accompanied by stock powers duly executed in blank and
(ii) Sub shall deliver to such Shareholder a certified or bank cashier's
check or checks payable to or upon the order of such Shareholder in an
amount equal to (A) the number of such Shareholder's Shares being
purchased at the Closing multiplied by (B) the Purchase Price.
ARTICLE IV.
REPRESENTATIONS AND WARRANTIES OF SHAREHOLDER
Each Shareholder severally, and not jointly, represents and
warrants to Parent and Sub as follows:
Section 4.1. Title to Shares. Such Shareholder is the sole
beneficial owner of the Shares (as may be adjusted from time to time
pursuant to Section 7.1 hereof) set forth opposite his name on Annex I to
this Agreement, free and clear of any pledge, lien, security interest,
mortgage, charge, claim, equity, option, proxy, voting restriction, voting
trust or agreement, understanding, arrangement, right of first refusal,
limitation on disposition, adverse claim of ownership or use or
encumbrance of any kind ("Encumbrances"), other than restrictions
imposed by applicable securities laws or pursuant to this Agreement and
the Merger Agreement, and except that as of the date hereof 40,000
Shares owned by N. Xxxxxxx Xxxxxx are pledged as security for a loan.
Section 4.2. Total Shares. On the date hereof, the Shares
opposite such Shareholder's name on Annex I hereto constitute all of the
Shares owned by such Shareholder. Such Shareholder has the exclusive
right to vote or dispose of (or exercise the voting or disposition of) such
Shares and Shareholder owns no options to purchase or rights to
subscribe for or otherwise acquire any securities of the Company other
than as set forth on Annex I hereto.
Section 4.3. Due Authorization. Each Shareholder has the
legal capacity to execute and deliver this Agreement and to consummate
the transactions contemplated hereby. This Agreement has been duly
executed and delivered by or on behalf of such Shareholder and,
assuming its due authorization, execution and delivery by Parent and
Sub, constitutes a legal, valid and binding obligation of such
Shareholder, enforceable against such Shareholder in accordance with its
terms, except as enforcement may be limited by bankruptcy, insolvency,
moratorium or other laws effecting creditors' rights generally and by
general equitable principles (regardless of whether such enforceability is
considered in a proceeding in equity or at law).
Section 4.4. No Conflicts; Required Filings and Consents.
(a) The execution and delivery of this Agreement by
such Shareholder do not, and the performance by such Shareholder of
such Shareholder's obligations under this Agreement will not (i) conflict
with or violate any law applicable to such Shareholder or by which such
Shareholder or any of such Shareholder's properties is bound or affected
or (ii) result in any breach of or constitute a default (or an event that with
notice or lapse of time or both would become a default) under, or give to
others any rights of termination, acceleration or cancellation of, or result
in the creation of a lien or encumbrance on any assets of such
Shareholder, including, without limitation, his Shares, pursuant to, any
note, bond, mortgage, indenture, contract, agreement, lease, license,
permit, franchise or other instrument or obligation to which such
Shareholder is a party or by which such Shareholder or any of such
Shareholder's assets is bound or affected, except for any such breaches,
defaults or other occurrences that would not prevent or delay the
performance by such Shareholder of such Shareholder's obligations
under this Agreement.
(b) The execution and delivery of this Agreement by
such Shareholder do not, and the performance by such Shareholder of
such Shareholder's obligations under this Agreement will not, require
any consent, approval, authorization or permit of, or filing with or
notification to, any governmental or regulatory authority (other than any
necessary filing under the HSR Act or similar foreign laws or the
Exchange Act), domestic or foreign, except where the failure to obtain
such consents, approvals, authorizations or permits, or to make such
filings or notifications, would not prevent or delay the performance by
such Shareholder of such Shareholder's obligations under this
Agreement. There is no beneficiary or holder of a voting trust certificate
or other interest of any trust of which such Shareholder is trustee whose
consent is required for the execution and delivery of this Agreement or
the consummation by Shareholder of the transactions contemplated
hereby.
Section 4.5. No Finder's Fees. No broker, investment
banker, financial adviser or other person is entitled to any broker's,
finder's, financial advisor's or other similar fee or commission in
connection with the transactions contemplated hereby based upon
arrangements made by or on behalf of such Shareholder. Such
Shareholder hereby acknowledges that he is not entitled to receive any
broker's, finder's, financial advisor's or other similar fee or commission
in connection with the transactions contemplated hereby or by the
Merger Agreement.
ARTICLE V.
REPRESENTATIONS AND WARRANTIES OF
SUB AND PURCHASER
Parent and Sub hereby, jointly and severally, represent and
warrant to each Shareholder as follows:
Section 5.1. Due Organization, Authorization, etc. Sub and
Parent are corporations duly organized, validly existing and in good
standing under the laws of their respective jurisdictions of incorporation.
Sub and Parent have all requisite corporate power and authority to
execute and deliver this Agreement and to consummate the transactions
contemplated hereby. The execution and delivery of this Agreement and
the consummation of the transactions contemplated hereby by each of
Sub and Parent have been duly authorized by all necessary corporate
action on the part of Sub and Parent, respectively. This Agreement has
been duly executed and delivered by each of Sub and Parent and,
assuming its due authorization, execution and delivery by each
Shareholder, constitutes a legal, valid and binding obligation of each of
Sub and Parent, enforceable against Sub and Parent in accordance with
its terms, except as enforcement may be limited by bankruptcy,
insolvency, moratorium or other laws affecting rights of creditors
generally and by general equitable principles (regardless of whether such
enforceability is considered in a proceeding in equity or at law).
Section 5.2. Funds. Parent has sufficient funds available to it
to pay for the Shareholder Shares in accordance with this Agreement and
the Merger Agreement.
Section 5.3. No Conflicts.
(a) The execution and delivery of this Agreement by
Parent and Sub do not, and the performance by Parent and Sub of their
obligations under this Agreement will not (i) conflict with or violate any
law applicable to Parent or Sub or by which Parent or Sub any of their
properties is bound or affected or (ii) result in any breach of or constitute
a default (or an event that with notice or lapse of time or both would
become a default) under, or give to others any rights of termination,
acceleration or cancellation of, or result in the creation of a lien or
encumbrance on any assets of Parent or Sub, pursuant to, any note, bond,
mortgage, indenture, contract, agreement, lease, license, permit,
franchise or other instrument or obligation to which Parent or Sub is a
party or by which Parent or Sub or any of their assets is bound or
affected, except for any such breaches, defaults or other occurrences that
would not prevent or delay the performance by Parent or Sub of their
obligations under this Agreement.
(b) The execution and delivery of this Agreement by
Parent and Sub do not, and the performance by Parent and Sub of their
obligations under this Agreement will not, require any consent, approval,
authorization or permit of, or filing with or notification to, any
governmental or regulatory authority (other than any necessary filing
under the HSR Act or similar foreign laws or the Exchange Act),
domestic or foreign, except where the failure to obtain such consents,
approvals, authorizations or permits, or to make such filings or
notifications, would not prevent or delay the performance by Parent or
Sub of their obligations under this Agreement.
Section 5.4. Purchase Without View to Distribute. Any
Shareholder Shares acquired by Sub hereunder are not being acquired
with a view to distribution within the meaning of the Securities Act of
1933, as amended (the "1933 Act"), and the rules and regulations
thereunder, and Sub will not distribute such Shareholder Shares in
violation of the 1933 Act.
ARTICLE VI.
COVENANTS OF THE SHAREHOLDERS
Section 6.1. No Inconsistent Arrangements. Each
Shareholder hereby covenants and agrees that, except as contemplated by
this Agreement and the Merger Agreement, he shall not (i) transfer
(which term shall include, without limitation, any sale, gift, pledge or
other disposition), or consent to any transfer of, any or all of his Shares
or any interest therein, (ii) enter into any contract, option or other
agreement or understanding with respect to any transfer of any or all of
such shares or any interest therein, (iii) grant any proxy, power-of-
attorney or other authorization in or with respect to his Shares, (iv)
deposit his Shares into a voting trust or enter into a voting agreement or
arrangement with respect to his Shares, or (v) take any other action that
would in any way restrict, limit or interfere with the performance of his
obligations hereunder or the transactions contemplated hereby or by the
Merger Agreement.
Section 6.2. Each Shareholder covenants and agrees that,
during the term of this Agreement, he shall not, directly or indirectly
through any officer, director, agent or other representative, solicit,
initiate or encourage, or take any other action designed or reasonably
likely to facilitate, any inquiries or the making of any proposal from any
person (other than Parent, Sub and any of their Affiliates (as defined
below)) relating to (i) any acquisition of all or any shares of Common
Stock of the Company or (ii) any transaction that constitutes a Takeover
Proposal, or participate in any negotiations regarding, or furnish to any
person any information with respect to, or otherwise cooperate in any
way with, or assist or participate in or facilitate or encourage, any effort
or attempt by any person to do or seek to do any of the foregoing. Such
Shareholder immediately shall cease and cause to be terminated all
existing discussions or negotiations of such Shareholder and his agents or
other representatives with any person conducted heretofore with respect
to any of the foregoing. Such Shareholder shall notify Parent and Sub
promptly if any such proposal or offer, or any inquiry or contact with any
person with respect thereto, is made and shall, in any such notice to
Parent and Sub, indicate in reasonable detail the identity of the person
making such proposal, offer, inquiry or contact and the terms and
conditions of such proposal, offer, inquiry or contact. Notwithstanding
any provision of this Section 6.2 to the contrary, if such Shareholder or
any agent or representative of such Shareholder is a member of the Board
of Directors of the Company, such member of the Board of Directors of
the Company may take actions in such capacity to the extent permitted
by Section 6.2 of the Merger Agreement. As used in this Agreement,
with respect to any person, "Affiliate" shall mean any entity directly or
indirectly controlling, controlled by, or under common control with, such
person.
Section 6.3. Waiver of Appraisal Rights. Each Shareholder
hereby waives any rights of appraisal or rights to dissent from the
Merger.
ARTICLE VII.
MISCELLANEOUS
Section 7.1. Certain Events. In the event of any stock split,
stock dividend, merger, reorganization, recapitalization or other change
in the capital structure of the Company affecting the Shares or the
acquisition of additional shares of capital stock or other securities or
rights of the Company by any Shareholder, the number of such
Shareholder's Shares shall be adjusted appropriately, and this Agreement
and the rights and obligations hereunder shall attach to any additional
shares of Common Stock or other securities or rights of the Company
issued to or acquired by any such Shareholder in respect of such
Shareholder Shares.
Section 7.2. Termination. This Agreement shall terminate
and be of no further force and effect automatically and without any
required action of the parties hereto upon the earlier to occur of (A) the
Effective Time and (B) the calendar day immediately after the
termination of the Merger Agreement in accordance with its terms;
provided, however, that Articles III, IV, V, VI and VII of this Agreement
shall survive the termination of this Agreement until the earlier to occur
of the Closing of the exercise of the Option and the expiration of the
Option. No such termination of this Agreement shall relieve any party
hereto from any liability for any breach of this Agreement prior to
termination.
Section 7.3. Expenses. All costs and expenses incurred in
connection with the transactions contemplated by this Agreement shall
be for the account of the party incurring such costs and expenses.
Section 7.4. Notices. All notices and other communications
hereunder shall be in writing and shall be deemed to have been duly
given when delivered in person, by facsimile, receipt confirmed, or on
the next business day when sent by overnight courier or on the second
succeeding business day when sent by registered or certified mail
(postage prepaid, return receipt requested) to the respective parties at the
following addresses (or at such other address for a party as shall be
specified by like notice):
(a) if to Parent or Sub, to:
EM Industries, Incorporated
0 Xxxxxxx Xxxxx
Xxxxxxxxx, Xxx Xxxx 00000
Attention: Xxxxxxx X. Xxxxx
Facsimile: (000) 000-0000
with copies to:
Xxxxxx & Xxxxx LLP
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx X. Xxxxxx, Esq.
Facsimile: (000) 000-0000
(b) If to Shareholders, to the address set forth in
Annex I hereto:
Section 7.5. Severability. In case any provision in this
Agreement shall be held invalid, illegal or unenforceable by a court of
competent jurisdiction, such provision shall be modified or deleted, as to
the jurisdiction involved, only to the extent necessary to render the same
valid, legal and enforceable, and the validity, legality and enforceability
of the remaining provisions hereof shall not in any way be affected or
impaired thereby nor shall the validity, legality or enforceability of such
provision be affected thereby in any other jurisdiction.
Section 7.6. Entire Agreement. This Agreement constitutes
the entire agreement among the parties with respect to the subject matter
hereof and supersedes all prior agreements and understandings, both
written and oral, among the parties, or any of them, with respect thereto.
Section 7.7. Assignment. Neither this Agreement nor any of
the rights, interests or obligations hereunder shall be assigned by any of
the parties hereto (whether by operation of law or otherwise) without the
prior written consent of the other parties, and any such purported
assignment shall be null and void; provided, however, that either of
Parent or Sub may, without the prior written consent of any Shareholder,
assign its rights and obligations to any of its direct or indirect wholly
owned subsidiaries. Subject to the preceding sentence, this Agreement
shall be binding upon, inure to the benefit of and be enforceable by, the
parties and their respective successors and assigns, and the provisions of
this Agreement are not intended to confer upon any person other than the
parties hereto any rights or remedies hereunder.
Section 7.8. Amendment. This Agreement may not be
modified, amended, altered or supplemented, except upon the execution
and delivery of a written agreement executed by all of the parties hereto;
provided that Annex I hereto may be supplemented by Parent by adding
the name and other relevant information concerning any shareholder of
the Company who agrees to be bound by the terms of this Agreement
without the agreement of any other party hereto, and thereafter such
added shareholder shall be treated as a "Shareholder" for all purposes of
this Agreement.
Section 7.9. Further Assurances. Each Shareholder shall,
upon request of Parent or Sub, execute and deliver any additional
documents and take such further actions as may reasonably be deemed
by Parent or Sub to be reasonably necessary or desirable to consummate,
in the most expeditious manner practicable, the transactions
contemplated by this Agreement.
Section 7.10. No Waiver. The failure of any party hereto to
exercise any right, power, or remedy provided under this agreement or
otherwise available in respect hereof at law or in equity, or to insist upon
compliance by any other party hereto with his or its obligations
hereunder, any custom or practice of the parties at variance with the
terms hereof shall not constitute a waiver by such party of his or its right
to exercise any such or other right, power or remedy or to demand such
compliance.
Section 7.11. Specific Performance. Each of the parties hereto
acknowledges and agrees that in the event of any breach of this
Agreement, each non-breaching party would be irreparably and
immediately harmed and could not be made whole by monetary
damages. It is accordingly agreed that the parties hereto (i) shall waive,
in any action for specific performance, the defense of adequacy of a
remedy at law and (ii) shall be entitled, in addition to any other remedy
to which they may be entitled at law or in equity, to compel specific
performance of this Agreement.
Section 7.12. Governing Law. This Agreement shall be
governed by, and construed in accordance with, the internal laws of the
Commonwealth of Pennsylvania without regard to its conflict of laws
principles.
Section 7.13. Headings. The descriptive headings contained
in this Agreement are included for convenience of reference only and
shall not affect in any way the meaning or interpretation of this
Agreement.
Section 7.14. Counterparts. This Agreement may be executed
in one or more counterparts, each of which shall be deemed an original,
but all of which together shall constitute one and the same instrument.
IN WITNESS WHEREOF, each of Parent and Sub has caused
this Agreement to be executed by its officer thereunto duly authorized
and each Shareholder has caused this Agreement to be executed, or duly
executed by an authorized signatory, as of the date first written above.
EM LABORATORIES,
INCORPORATED
By: /s/ Xxxxxxx X.
Xxxxx
Name: Xxxxxxx X.
Xxxxx
Title: Vice-President
and Secretary
EM SUBSIDIARY,
INC.
By: /s/ Xxxxxx
Xxxxxxx
Name: Xxxxxx Xxxxxxx
Title: President
By: /s/ Xxxxxxx X.
Xxxxxx
Xxxxxxx X.
Xxxxxx
By: /s/ N. Xxxxxxx
Xxxxxx
X. Xxxxxxx
Xxxxxx
XXX 180342.9
