Looking for an agreement? Search from over 1 million agreements now.

Option Repurchase Agreement

This is an actual contract by Advanced Accessory Holdings.

Save time and money with our Premium Packages.
Buy all (8) recommended agreements for
$140.00 (50% savings)
Agreement Preview
Sectors: Automotive and Transport Equipment
Governing Law: New York, View New York State Laws
Effective Date: May 17, 2005
Related Agreement Types:
Search This Document
Exhibit 10.2
Execution Copy


OPTION REPURCHASE AGREEMENT


This Option Repurchase Agreement (this "Agreement") is made and entered into as of May 17, 2005 by and between Brink International B.V. (the "Company"), a private company with limited liability ("besloten vennootschap met beperkte aansprakelijkheid") organized and existing under the laws of The Netherlands, having its corporate seat at Staphorst (address: 7951 CX Staphorst, Industrieweg 5, The Netherlands), and Gerrit DeGraaf (the "Optionholder").


WHEREAS, the Optionholder is an employee of the Company and/or one of its Subsidiaries;


WHEREAS, pursuant to that certain Brink Management Option Subscription Agreement (the "BRINK SUBSCRIPTION AGREEMENT") dated as of the date hereof between the Company and the Optionholder, among other things, the Company agreed to grant and the Optionholder agreed to acquire options to purchase 7254 ordinary shares of the Company (the "RESTRICTED OPTIONS"); and


NOW, THEREFORE, the parties hereto agree as follows:


1. DEFINITIONS. For the purposes of this Agreement, the following terms shall have the meanings set forth below:


"ADJUSTED BRINK EBITDA" means, for any period, the net income (or net loss) of the Brink Companies, determined in accordance with GAAP, plus (a) any provision for (or less any benefit from) Income Taxes, (b) any deduction for interest expense, net of interest income and (c) depreciation and amortization expense (including the amortization of capitalized tooling that is customer owned and non-reimbursed), and as adjusted for the following items (to the extent that they are reflected in net income or net loss):


(i) elimination of: (A) all extraordinary gains and losses determined in accordance with GAAP (APB 30), (B) gains and losses from sales or dispositions of property and equipment or other fixed assets, (C) all non-recurring income and expense items not incurred in the ordinary course of business to the extent included in the determination of net income for the relevant determination period and (D) foreign currency transaction gains and losses, to the extent included in the determination of net income for the relevant determination period;


(ii) add back for the portion of the management fees that are paid or accrued to members of the Castle Harlan Group, pursuant to the Management Agreement charged to the Brink Companies in accordance with past practice; and


(iii) elimination of any income statement impact from the reserve established by any of the Brink Companies in connection with the G3.0 Model Recall (as defined in the Securities Purchase Agreement), to the extent Losses (as defined in the Securities Purchase Agreement) arising from the G3.0 Model Recall are actually paid for or reimbursed by the Sellers or are subject to a continuing obligation of indemnification of the Sellers pursuant to Article IX of the Securities Purchase Agreement under which the Sellers are not in default.


Each of the financial accounting terms in this definition of Adjusted Brink EBITDA shall be determined in accordance with GAAP, to the extent such items are addressed by GAAP.


"AFFILIATE" shall mean, with respect to any specified Person, a Person that directly, or indirectly through one or more intermediaries, controls, is controlled by or is under common control with, such specified Person (it being understood that a Person shall be deemed to "control" another Person, for purposes of this definition, if such Person directly or indirectly has the power to direct or cause the direction of the management and policies of such other Person, whether through holding beneficial ownership interests in such other Person, through contracts or otherwise). For purposes of an individual, an Affiliate of such individual shall also mean any family member of such individual or a Person owned 10% or more by such individual.


"ATTRIBUTED CONSOLIDATED EBITDA MULTIPLE" shall be determined, in connection with a Consolidated Change in Control, as the quotient determined by dividing:


(A) the Fair Value of the consideration received, without
duplication, for the sale of the equity interests sold by
all holders of equity interests in the Persons or assets
sold in the Consolidated Change in Control on an enterprise
value basis and without giving effect to any reduction of
net Indebtedness (as of the date of receipt thereof) plus


(B) if applicable, the Fair Value of any direct or indirect
beneficial ownership interest maintained by any holder of
equity interests in the Persons or any successor entity
immediately after such Consolidated Change in Control in
lieu of the sale or disposition of such interests for cash;
PROVIDED, that, in the case of a Consolidated Change in
Control occurring as part of a Public Offering, the Fair
Value of any class of equity interests publicly offered
shall be the price at which such interests are sold to the
public in such Public Offering.


BY


the earnings before interest, tax, depreciation and amortization of the Persons or the businesses being sold in the Consolidated Change in Control (determined using the definition of "Adjusted Brink EBITDA" and replacing references therein to the "Brink Companies" with the Persons or businesses being sold in such Consolidated Change in Control).


"BOARD" shall mean the Board of Managers of the Parent.


"BRINK CHANGE IN CONTROL" means the initial event or series of events that does not otherwise constitute a Consolidated Change in Control in which:


(i) any Persons who are not shareholders of the Company as of
the date hereof shall become the direct or indirect beneficial owners
(within the meaning of Section 13(d) of the Exchange Act) of equity
interests in the


-2-


Company which represent a majority of the voting power of all classes
of equity interests of the Company taken together as one class, except
pursuant to an underwritten Public Offering; or


(ii) there shall occur a sale or other disposition of all or
substantially all of the assets of the Brink Parent, other than to the
Parent and/or to one or more Subsidiaries of the Parent that are and
that remain a corporation, partnership, association or other business
entity of which securities or other ownership interests representing
more than 50% of the equity and more than 50% of the ordinary voting
power or more than 50% of the general partnership interests are owned
by the Parent or any Subsidiaries of the Parent.


"BRINK COMPANIES" shall mean, collectively, the Brink Parent and its Subsidiaries.


"BRINK PARENT" shall mean AAS Acquisitions, LLC.


"CALCULATED OPTION VALUE" shall mean the amount determined by calculating the difference between (a) the quotient determined by dividing (i) Total Brink Equity Value, as of the Repurchase Price Date, by (ii) the number of outstanding Options, including all of the Restricted Options, outstanding on a Fully Diluted Basis on the Repurchase Price Date, less (b) the Option Exercise Price with respect to such Restricted Option.


"CASH EQUIVALENTS" shall mean (i) United States dollars (ii) cash denominated in foreign currencies based upon the exchange rate set forth in the Wall Street Journal on the relevant date of determination, (iii) securities issued or directly and fully guaranteed or insured by the United States government or any agency or instrumentality thereof having maturities of not more than one year from the date of acquisition, (iv) certificates of deposit with maturities of one year or less from the date of acquisition, bankers' acceptances with maturities not exceeding one year, and overnight bank deposits, in each case, with any Eligible Institution, (v) commercial paper rated, "P-1," "A-1" or the equivalent thereof by Moody's or S&P, respectively, and in each case maturing within 180 days after the date of acquisition, (vii) shares of money market funds that invest solely in United States dollars and securities of the types described in clauses (iii) through (v), and (viii) demand and time deposits and certificates of deposit with an Eligible Institution or with commercial banks insured by the Federal Deposit Insurance Corporation; PROVIDED, that the face amount of any outstanding uncashed checks written by the Company or any of its Subsidiaries shall be deducted in the determination of Cash Equivalents to the extent not otherwise treated as a current liability in any relevant determination.


"CASTLE HARLAN GROUP" shall mean CHP IV, CHI and any other accounts or funds managed by CHI or any Affiliate of CHI, other than the Parent and its Subsidiaries.


"CAUSE" shall mean with respect to the Optionholder, (a) the Optionholder's continued failure to substantially perform the Optionholder's duties, (b) failure to follow the lawful directions of the Board of Managers of the Parent or any Subsidiary by whom the Optionholder is then employed, either directly or indirectly through its Chairman, (c) material, willful acts of dishonesty, theft or fraud resulting or intending to result in personal gain or enrichment at the expense of the Parent or any of its Subsidiaries, (d) commission of a felony, (e)


-3-


a violation of any written policy of the Parent or any of its Subsidiaries including, but not limited to, the Parent's or any Subsidiaries' by whom the Optionholder is then employed employment manuals, rules and regulations which materially and adversely affects the Parent or any of its Subsidiaries by whom the Optionholder is then employed or could reasonably be expected to materially and adversely affect the Parent or any of its Subsidiaries by whom the Optionholder is then employed, or (f) the Optionholder engaging in any act that is intended, or may reasonably be expected to materially harm the reputation, business or operations of the Parent or any of its Subsidiaries by whom the Optionholder is then employed or any member of their respective Boards of Managers or similar governing bodies or (g) any other material breach of this Agreement or any other agreement with the Parent or any of its Subsidiaries that the Optionholder signs in his personal capacity, including, but not limited to, any non-competition and confidentiality agreement, but excluding the Securities Purchase Agreement. Prior to a termination for "Cause", the Optionholder shall be entitled to written notice from the Parent or the Company and ten (10) business days to cure the deficiency leading to the Cause determination, if such deficiency is curable. Notwithstanding the foregoing and without limiting the foregoing in any way, for the avoidance of doubt, the Optionholder shall receive written notice and ten (10) business days to cure a deficiency under subsections (a) and (b) hereof. Notwithstanding the foregoing, to the extent that the Optionholder is subject to an employment agreement with the Parent and/or one of its Subsidiaries that contains a definition of cause, "Cause" under this Agreement shall be as defined in such employment agreement.


"CONSOLIDATED CHANGE IN CONTROL" means the initial event or series of events in which:


(i) any Persons who are not Equityholders as of the date hereof
shall become the direct or indirect beneficial owners (within the
meaning of Section 13(d) of the Exchange Act) of equity interests in
the Parent which represent a majority of the voting power of all
classes of equity interests of the Parent taken together as one class,
except pursuant to an underwritten Public Offering; or


(ii) there shall occur a sale or other disposition of all or
substantially all of the assets of the Parent, other than to the
Parent and/or to one or more Subsidiaries of the Parent that are and
that remain a corporation, partnership, association or other business
entity of which securities or other ownership interests representing
more than 50% of the equity and more than 50% of the ordinary voting
power or more than 50% of the general partnership interests are owned
by the Parent or any Subsidiaries of the Parent; or


(iii) so long as no Consolidated Change in Control has occurred
under clauses (i) or (ii) above at such time, CHP IV, John K. Castle
or Leonard M. Harlan shall cease to have the right to designate and
elect a majority of the members of the Board of Managers of the
Parent; or


(iv) a CHP IV Distribution has occurred; or


(v) a Brink Change in Control in which contemporaneously
therewith, there shall occur a sale or other disposition of more than
50% of the equity


-4-


interests in or all or substantially all of the assets of, all other
businesses of the Parent (including the SportRack and/or Valley
businesses) other than to the Parent and/or to one or more
Subsidiaries of the Parent that are and that remain a corporation,
partnership, association or other business entity of which securities
or other ownership interests representing more than 50% of the equity
and more than 50% of the ordinary voting power or more than 50% of the
general partnership interests are owned by the Parent or any
Subsidiaries of the Parent.


PROVIDED, that, in no event shall a Consolidated Change in Control be deemed to occur as a result of the sale or other disposition of the SportRack and/or Valley businesses in the absence of a contemporaneous Brink Change in Control, even if such sale or disposition represents all or substantially all of the assets of the Parent.


"CHI" shall mean Castle Harlan, Inc., a Delaware corporation.


"CHP IV" shall mean Castle Harlan Partners IV, L.P., a Delaware limited partnership.


"CHP IV DISTRIBUTION" shall mean the distribution by CHP IV of all of its equity interests in the Parent (or the securities issued in respect thereof or in exchange therefor) to its limited partners, other than by reason of the dissolution, liquidation or termination of CHP IV.


"COMPANY" shall have the meaning set forth in the preamble to this Agreement.


"DETERMINATION DATE" shall mean the last day of each Measurement Period; PROVIDED, that in the event of a Brink Change in Control or Consolidated Change in Control, the "Determination Date" shall mean the date that such Brink Change in Control or Consolidated Change in Control occurs.


"DISABILITY" shall mean a determination by the Company, in accordance with applicable law that, as a result of a physical or mental injury or illness, the Optionholder is unable to perform the essential functions of his job with or without reasonable accommodation. Notwithstanding the foregoing, to the extent that the Optionholder is subject to an employment agreement with the Parent and/or one of its Subsidiaries that contains a definition of disability, "Disability" under this Agreement shall be as defined in such employment agreement or if the Optionholder is not subject to an employment agreement with the Parent and/or one of its Subsidiaries and such Optionholder is covered by a disability policy covering employees of the Parent and/or the relevant Subsidiary by whom the Optionholder is then employed, then "Disability" shall be defined as such term is defined in such policy.


"ELIGIBLE INSTITUTION" means a commercial banking institution that has combined capital and surplus of not less than $500 million and that is rated "A" (or higher) according to Moody's or S&P at the time as of which any investment or rollover therein is made.


"EMPLOYEE GOOD REASON" shall mean, without the consent of the Optionholder (a) a reduction in base salary or any agreed upon benefit provided to the Optionholder; provided that the Parent or any of its Subsidiaries may at any time or from time to time amend, modify, suspend or terminate any bonus, incentive compensation or other benefit plan or program (in


-5-


each case, other than base salary) provided to the Optionholder for any reason and without the Optionholder's consent if such modification, suspension or termination is consistent with modifications, suspensions or terminations for other employees of the Parent or any of its Subsidiaries that are on a level comparable to the Optionholder, (b) a material reduction in the Optionholder's responsibilities or duties (other than a change in the number or identity of persons reporting to the Optionholder) or the title of the Optionholder or (c) the requirement by the Board of Managers of the Parent or any of its Subsidiaries (or any comparable governing body) that the Optionholder relocate his residence from the Staphorst, Holland area; PROVIDED, that, the Parent shall have thirty (30) days after receipt of notice from the Optionholder to cure the deficiency resulting in the termination with Employee Good Reason. Notwithstanding the foregoing, to the extent that the Optionholder is subject to an employment agreement with the Parent and/or one of its Subsidiaries that contains a definition of good reason or employee good reason, "Employee Good Reason" under this Agreement shall be as defined in such employment agreement.


"EQUITYHOLDER" means holders of equity interests of the Parent or any member of the Castle Harlan Group and their respective Affiliates, but only to the extent the foregoing hold interests in the Parent, the voting control over which is vested with an officer, director or senior employee of CHI.


"EXCHANGE ACT" shall mean the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder.


"EXISTING SENIOR CREDIT FACILITY" means the Amended and Restated Credit Agreement among SportRack LLC, Valley Industries LLC, Brink B.V., various lenders from time to time party thereto, and General Electric Capital Corporation as agent for such lenders, as such Amended and Restated Credit Agreement may be amended, supplemented, or otherwise modified or replaced from time to time including any refinancing thereof.


"FAIR VALUE" means, on any date specified herein (i) in the case of Cash Equivalents, the dollar amount thereof, (ii) in the case of a security admitted for trading on any national securities exchange or quoted in the over-the-counter market, the Market Price, (iii) in the case of securities or property subject to a sale agreement, the implied fair market value thereof, to the extent such value may be clearly extrapolated from the express provisions of the agreements or instruments governing the sale or disposition of such securities or property and (iv) in all other cases, the fair market value thereof as determined in good faith by the Parent.


"FIRST ANNIVERSARY" shall mean December 31, 2005.


"FIRST DAY OF MEASUREMENT PERIOD" shall mean the first day of the next calendar month immediately following the month of the Starting Date.


"FIRST MEASUREMENT PERIOD" shall mean the period commencing on the First Day of Measurement Period and ending on the First Anniversary.


"FULLY-DILUTED BASIS" shall mean with respect to any Person, all outstanding equity interests in such Person, whether or not subject to a repurchase agreement, and after giving effect to any additional equity interests of such Person issued or issuable upon the exercise, conversion or exchange of any options, warrants and other rights to acquire equity


-6-


interests of such Person outstanding, whether or not vested, on or immediately prior to the Determination Date (or the Repurchase Price Date, in the case of a determination of Repurchase Price under Section 3 hereof); PROVIDED, HOWEVER, that with respect to Restricted Options, only those Restricted Options that have become Type 2 Restricted Options, including any portion of the Type 1 Restricted Options that have been tested under Section 3(c)(i) and have become Type 2 Restricted Options and any Type 1 Restricted Options only to the extent that they are being tested under Section 3(c)(i) hereof shall be counted in the determination of Fully-Diluted Basis.


"GAAP" shall mean U.S. generally accepted accounting principles Consistently Applied (as such term is defined in the Securities Purchase Agreement).


"GOVERNMENTAL ENTITY" means any nation or government, any foreign, federal, state, province, city, town, municipality, county, local or other political subdivision thereof or thereto and any department, commission, court or arbitrator of competent jurisdiction, stock exchange board, bureau, instrumentality, agency, organization, self-regulatory authority or other entity exercising executive, legislative, judicial, taxing, regulatory, quasi-governmental or administrative powers or functions of or pertaining to government.


"INCOME TAXES" means Taxes imposed upon, or measured by, net income.


"INDEBTEDNESS" means, without duplication, with respect to any Person and its Subsidiaries (i) all indebtedness for borrowed money, (ii) all obligations for the deferred purchase price of property and assets or services, other than those incurred in the ordinary course of business; (iii) all obligations evidenced by notes, bonds, debentures or other similar instruments, or upon which interest payments are ordinarily made, (iv) all capitalized lease obligations (including, in the case of the Parent and its Subsidiaries, whether or not treated as a capitalized lease obligation under GAAP, the aggregate amount of the unpaid obligations under the lease entered into in connection with the French Facility Building Sale/Leaseback Transaction (as defined in the Securities Purchase Agreement)), (v) all obligations under acceptance, standby letters of credit or similar facilities, (vi) all matured obligations to purchase, redeem, retire, defease or otherwise make any payment in respect of any membership interests, shares of capital stock or other ownership or profit interest or any warrants, rights or options to acquire such membership interests, shares or such other ownership or profit interest (it being understood that, for purposes of this definition, redeemable warrants shall not constitute Indebtedness until the holder of any such warrant is entitled by its terms to require redemption thereof), (vii) all obligations guaranteeing any Indebtedness, leases, dividends or other obligations, of any other Person in any manner, whether directly or indirectly, (viii) all accrued interest of all obligations referred to in (i) - (vii) and (ix) all obligations referred to in (i) - (viii) of a third-party secured by any Lien on property or assets; PROVIDED, that Indebtedness shall exclude all intercompany Indebtedness between the Brink Companies but shall not exclude Indebtedness owing by any of the Brink Companies to the Parent or any Subsidiary of the Parent that is not a member of the Brink Companies; PROVIDED, FURTHER, that the amounts of the "other non-current assets" specifically referenced in subsection (j) of the definition of Net Indebtedness in the Securities Purchase Agreement outstanding on any relevant date of determination arising with respect to the French Facility Building Sale/Leaseback Transaction (as defined in the Securities Purchase Agreement), together with accrued and unpaid interest thereon through the relevant date of determination, shall reduce the amount of Indebtedness in any relevant


-7-


determination of Indebtedness. For the avoidance of doubt, any unfunded portion (whether or not recorded in the books and records of the Parent and its Subsidiaries) of any pension plan of the Parent and its Subsidiaries, whether a U.S. Benefit Plan covered by Title IV of ERISA or a Foreign Pension Plan, in each case as defined in the Securities Purchase Agreement, shall not be considered part of Indebtedness.


"IRR" means the compounded internal rate of return to the Brink Parent with respect to its investment in the Company and its Subsidiaries calculated for the period from the Starting Date to any Determination Date, based on the Original Equity Value, any Subsequent Equity Contribution and the Total Brink Equity Value (as though such Total Brink Equity Value were paid in full to the Brink Parent on the relevant Determination Date), based on the following equation:


Brink Parent Equity Value = ((1 + IRR)[n] x Original Equity Value) + ((1 + IRR)[s] x Subsequent Equity Contribution) - ((1+IRR)[t] x dividends, distributions on equity or redemption proceeds in respect of capital stock or other equity securities received, directly or indirectly, by the Brink Parent (excluding in all cases, tax distributions and management fees paid or payable to the Brink Parent or any other Subsidiary of the Parent that is not a member of the Brink Group).


where n is the number of whole months from the Starting Date to the Determination Date, s is the number of whole months from the date of the applicable Subsequent Equity Contribution by the Brink Parent in the Company or any of its Subsidiaries, without duplication, to the Determination Date and t is the number of whole months from the date of such dividend, distribution or redemption to the Determination Date.


"IRR-BASED OPTIONS" shall mean 3,625 of the Restricted Options acquired by the Optionholder.


"IRR TARGET" shall mean, with respect to 1,208 Restricted Options, an IRR of 1.5309470% per month from the Starting Date to the Determination Date and, with respect to 2,417 Restricted Options, an IRR of 1.8769265% per month from the Starting Date to the Determination Date; provided that, with respect to the IRR Based Options that become Type 2 Restricted Options on the basis of achievement of a 1.8769265% per month IRR, to the extent the IRR as of the Determination Date, is more than 1.5309470% per month and less than 1.8769265% per month, such IRR Based Options shall proportionately become Type 2 Restricted Options using a straight line interpolation following Appendix A.


"LIEN" means any preemptive right, mortgage, restriction on voting or transfer or any pledge, lien (statutory or otherwise), usufruct, hypothetical assignment for security, "claim" (as such term is used in this context outside of the United States), preference priority charge, hypothecary, encumbrance or security interest of any kind.


"MANAGEMENT AGREEMENT" means the management agreement among the Parent, Advanced Accessory Systems, LLC and CHI, as may be amended, modified or supplemented from time to time.


-8-


"MARKET PRICE" means, on any date specified herein with respect to any securities, the amount per share of the securities, equal to (i) the last reported sale price of such securities, regular way, on such date or, in case no such sale takes place on such date, the average of the closing bid and asked prices thereof regular way on such date, in either case as officially reported on the principal national securities exchange on which such securities are then listed or admitted for trading, (ii) if such securities are not then listed or admitted for trading on any national securities exchange but are designated as a national market system security by the National Association of Securities Dealers ("NASD"), the last reported trading price of such securities on such date, or (iii) if there shall
-- End of Preview --
Home| About Us| FAQ| Subscription | Contact Us |

Privacy Policy   Terms of Service  3.85.143.239