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Exhibit 10.2.(a)
EXECUTION COPY
STOCKHOLDERS’ AGREEMENT
(Aurora
Entities Version)
STOCKHOLDERS’ AGREEMENT, dated as of March 5, 2007
(this " Agreement "), among MEGGITT-USA, INC., a
Delaware corporation (" Purchaser "), certain of the
stockholders of K & F INDUSTRIES HOLDINGS, INC., a Delaware
corporation (the " Company ") listed on the signature
pages hereto (each, a " Stockholder " and,
collectively, the " Stockholders ") and the
Company.
WHEREAS, Purchaser, Ferndown Acquisition Corp., a Delaware
corporation (" Merger Sub "), and the Company propose
to simultaneously herewith enter into an Agreement and Plan of
Merger dated as of the date hereof (as the same may be amended or
supplemented, the " Merger Agreement "; capitalized
terms used but not defined herein shall have the meanings set forth
in the Merger Agreement) providing for the merger of Merger Sub
with and into the Company;
WHEREAS, as of the date hereof, each Stockholder is both the
record and beneficial owner (as such term is defined in Rule 13d-3
of the Exchange Act) of that number of shares of Common Stock set
forth in column 1 opposite its name on Schedule A to this
Agreement (subject to adjustment as contemplated herein, the "
Owned Shares ");
WHEREAS, in addition to the Owned Shares, the Stockholders have
the irrevocable proxy power to vote, individually and as a group,
as of the date hereof, an aggregate of 2,743,753 shares of Common
Stock (subject to adjustment as contemplated herein, the "
Proxy Shares "), pursuant to that certain
Securityholders Agreement dated November 18, 2004, as amended
by the First Amendment dated as of December 27, 2004 and as further
amended by the Second Amendment dated as of April 27, 2005 (the "
Securityholders’ Agreement ");
WHEREAS, in addition to the Owned Shares and the Proxy Shares,
certain additional stockholders have agreed to vote, as of the date
hereof, an aggregate of 6,111,850 shares of Common Stock (subject
to adjustment as contemplated herein, the " Voting
Shares " and, collectively with the Owned Shares and the
Proxy Shares, the " Subject Shares ") in such manner
as the Stockholders shall vote, including with respect to all
matters required by this Agreement, pursuant to and subject to the
terms of the Securityholders’ Agreement; and
WHEREAS, as a condition to the willingness of Purchaser and
Merger Sub to enter into the Merger Agreement, and as an inducement
and in consideration therefor, Purchaser has requested that the
Stockholders enter into this Agreement.
NOW, THEREFORE, the parties hereto agree as follows:
Section 1. Representations, Warranties and Covenants of
the Stockholders . Each Stockholder hereby represents and
warrants, on a several and not joint basis, to Purchaser as of the
date hereof as follows:
(a)
Authority . Such Stockholder has all requisite power
and authority to execute this Agreement and to consummate the
transactions contemplated hereby. The execution and delivery
by such Stockholder of this Agreement and consummation of the
transactions contemplated hereby have been duly
authorized by all necessary action on the part of such
Stockholder.
(b)
Execution; Delivery; Securityholders’ Agreement
. Such Stockholder has duly executed and delivered this
Agreement, and this Agreement constitutes the valid and binding
obligation of such Stockholder, enforceable against such
Stockholder in accordance with its terms, subject to bankruptcy,
insolvency, fraudulent transfer, reorganization, moratorium and
similar laws of general applicability relating to or affecting
creditors rights and to general principles of equity. No
consent of, or registration or filing with, any Governmental Entity
is required to be obtained or made by or with respect to such
Stockholder in connection with the execution, delivery and
performance of this Agreement or the consummation of the
transactions contemplated hereby, other than (i) such reports,
schedules or statements under the Exchange Act as may be required
to be filed by such Stockholder in connection with this Agreement
and the transactions contemplated hereby and (ii) such consents,
registrations or filings by such Stockholder the failure of which
to be obtained or made would not have an adverse effect on such
Stockholder’s ability to timely perform its obligations
hereunder. The Securityholders’ Agreement is the valid
and binding obligation of such Stockholder, enforceable against
such party in accordance with its terms, subject to bankruptcy,
insolvency, fraudulent transfer, reorganization, moratorium and
similar laws of general applicability relating to or affecting
creditors rights and to general principles of equity. Such
Stockholder will not consent or permit any termination,
cancellation, amendment, waiver or modification of the
Securityholders’ Agreement that would, individually or in the
aggregate, reasonably be expected to impair the ability of such
Stockholder to timely perform its obligations under this Agreement
or prevent or delay the consummation of the transactions
contemplated by the Merger Agreement.
(c)
The Owned Shares . Such Stockholder is the record and
beneficial owner of the Owned Shares set forth in column 1 opposite
its name on Schedule A , free and clear of (i) any
Encumbrances (other than the Merger Agreement and those created by
the Securityholders’ Agreement) and (ii) any
restrictions whatsoever with respect to the ownership, transfer or
voting of the Owned Shares that would, individually or in the
aggregate, reasonably be expected to impair the ability of the
Stockholder to timely perform its obligations under this Agreement
or prevent or delay the consummation of the transactions
contemplated by the Merger Agreement. None of such Owned
Shares are subject to any voting trust or other voting agreement,
except pursuant to the Securityholders’ Agreement or as
contemplated by this Agreement. Except for the Subject
Shares, such Stockholder does not own beneficially or of record any
common stock or other voting securities of the Company on the date
hereof, and does not, directly or indirectly, own or have any
option, warrant or other right to acquire any securities of the
Company that are or may by their terms become entitled to vote or
any securities that are convertible or exchangeable into or
exercisable for any securities of the Company that are or may by
their terms become entitled to vote under the Company’s
Charter, applicable Law or otherwise.
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(d)
The Proxy Shares .
(i)
As of the date hereof, such Stockholder has the power to vote by
proxy, pursuant to the Securityholders’ Agreement, all of the
shares of Common Stock that constitute Proxy Shares as of the date
hereof.
(ii)
The parties acknowledge that neither the Securityholders’
Agreement nor this Stockholders Agreement prohibit any record owner
of the shares of Common Stock that constitute, as of the date
hereof, Proxy Shares, from selling or transferring any or all such
shares of Common Stock, and neither the Company nor any Stockholder
shall have any liability, hereunder, under the Merger Agreement or
otherwise, to Purchaser, Merger Sub or Parent if any such record
owner transfers or sells any such shares of Common Stock at any
time prior to the Effective Time. If any such record owner of
shares of Common Stock that constitute, as of the date hereof,
Proxy Shares, sells or transfers any such shares of Common Stock,
then such shares of Common Stock shall, effective upon such sale or
transfer, no longer constitute Proxy Shares and the number of
shares of Common Stock then subject to the definition of Proxy
Shares hereunder shall be adjusted accordingly.
(iii) As
of the Effective Time, such Stockholder will have the power to vote
by proxy, pursuant to the Securityholders’ Agreement, all of
the shares of Common Stock that constitute Proxy Shares as of the
Effective Time.
(e)
The Voting Shares .
(i)
As of the date hereof, such Stockholder has the contractual rights,
in its favor, set forth in Section 7.2 of the
Securityholders’ Agreement, with respect to all of the shares
of Common Stock that constitute, as of the date hereof, Voting
Shares.
(ii)
The parties acknowledge that neither the Securityholders’
Agreement nor this Stockholders Agreement prohibit any record owner
of the shares of Common Stock that constitute, as of the date
hereof, Voting Shares, from selling or transferring any or all such
shares of Common Stock, and neither the Company nor any Stockholder
shall have any liability, hereunder, under the Merger Agreement or
otherwise, to Purchaser, Merger Sub or Parent if any such record
owner transfers or sells any such shares of Common Stock at any
time prior to the Effective Time. If any such record owner of
shares of Common Stock that constitute, as of the date hereof,
Voting Shares, sells or transfers any such shares of Common Stock,
then such shares of Common Stock shall, effective upon such sale or
transfer, no longer constitute Voting Shares and the number of
shares of Common Stock then subject to the definition of Voting
Shares hereunder shall be adjusted accordingly.
(iii) As
of the Effective Time, such Stockholder will have the contractual
rights, in its favor, set forth in Section 7.2 of the
Securityholders’ Agreement, with respect to all of the shares
of Common Stock that constitute, as of the Effective Time, Voting
Shares.
(f)
No Conflicts . Subject to appropriate filings by such
Stockholder under the Exchange Act (which such Stockholder agrees
to make as and to the extent required by the Exchange Act), to the
extent applicable, the execution and delivery of this Agreement do
not,
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and the consummation of the transactions
contemplated hereby and compliance with the provisions hereof will
not, conflict with, result in a violation or breach of, or
constitute a default (or an event that, with notice or lapse of
time or both, would result in a default) or give rise to any right
of termination or acceleration under, (i) any organizational
or constituent document of such Stockholder (ii) the
Securityholders’ Agreement, (iii) any loan or credit
agreement, bond, note, mortgage, indenture, lease or any other
contract, agreement or instrument to which such Stockholder or is a
party or by which such Stockholder or any of the Subject Shares is
bound or (iv) any Law or Order applicable to such Stockholder;
except, in the case of clauses (iii) and (iv) above, for any such
violation, breach, default or right of termination or acceleration
that does not impair or materially delay such Stockholder’s
ability to perform its obligations hereunder.
Section 2. Representations and Warranties of
Purchaser . Purchaser hereby represents and warrants to
each Stockholder as follows:
(a)
Authority . Purchaser has all requisite corporate
power and authority to execute this Agreement and to consummate the
transactions contemplated hereby. The execution and delivery
by Purchaser of this Agreement and consummation of the transactions
contemplated hereby have been duly authorized by all necessary
action on the part of Purchaser.
(b)
Execution; Delivery . Purchaser has duly executed and
delivered this Agreement, and this Agreement constitutes the valid
and binding obligation of Purchaser, enforceable against Purchaser
in accordance with its terms, subject to bankruptcy, insolvency,
fraudulent transfer, reorganization, moratorium and similar laws of
general applicability relating to or affecting creditors rights and
to general principles of equity. No consent of, or
registration or filing with, any Governmental Entity is required to
be obtained or made by or with respect to Purchaser in connection
with the execution, delivery and performance of this Agreement or
the consummation of the transactions contemplated hereby, other
than as set forth in the Merger Agreement.
(c)
No Conflicts . Subject to compliance by Purchaser with
the Regulatory Filings, neither the execution and delivery of this
Agreement nor the performance by Purchaser of its obligations
hereunder will result in a violation or breach of, or constitute a
default (or an event that, with notice or lapse of time or both,
would result in a default) or give rise to any right of termination
or acceleration under, (i) Purchaser’s certificate of
incorporation or similar constituent documents, (ii) any loan
or credit agreement, bond, note, mortgage, indenture, lease or any
other contract, agreement or instrument to which Purchaser is a
party or by which Purchaser is bound, or (iii) any Law or
Order applicable to Purchaser; except, in the case of clauses (ii)
and (iii) above, for any such violation, breach, default or right
of termination or acceleration that does not impair or materially
delay Purchaser’s ability to perform its obligations
hereunder.
Section 3. Agreement to Vote Proxy Shares and Owned
Shares; Agreement with Respect to Voting Shares . Each
Stockholder agrees that, during the term of this Agreement, at any
meeting of the stockholders of the Company, however called, such
Stockholder shall vote (or cause to be voted) (i) all of the shares
of Common Stock that constitute, at the time of any such meeting,
Proxy Shares, and (ii) all of the Owned Shares (A) in favor of the
Merger, the adoption
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of the Merger Agreement and each other action
contemplated by the Merger Agreement and any actions required in
furtherance hereof or thereof and (B) against the adoption of any
Acquisition Proposal. Each Stockholder further agrees that,
during the term of this Agreement, in connection with any meeting
of the stockholders of the Company, however called, such
Stockholder shall give such instructions, notice or other
information, in accordance with the terms of the
Securityholders’ Agreement, and use its commercially
reasonable efforts (but in no event will any such Stockholder be
obligated to initiate litigation), to cause all of the shares of
Common Stock that constitute, at the time of any such meeting,
Voting Shares to be voted in accordance with the terms of the
Securityholders’ Agreement and this Agreement (i) in favor of
the Merger, the adoption of the Merger Agreement and each other
action contemplated by the Merger Agreement and any actions
required in furtherance hereof or thereof and (ii) against the
adoption of any Acquisition Proposal. The foregoing
provisions shall also apply to the extent appropriate in the event
of stockholder action by written consent to the extent permitted in
the Company’s Certificate of Incorporation.
Section 4. Provisions Concerning Common Stock
. Concurrently with this Agreement, each Stockholder has duly
executed and delivered an irrevocable proxy in the form attached as
Exhibit A hereto (the " Irrevocable Proxy
") appointing Purchaser and any of its authorized Representatives
as such Stockholder’s proxy with the power to vote, at any
meeting of stockholders of the Company, however called, or in any
other circumstance upon which the vote or other approval of holders
of Common Stock is sought, all of such Stockholder’s Owned
Shares and Proxy Shares: (i) in favor of the Merger, the
adoption of the Merger Agreement and each other action contemplated
by the Merger Agreement and any actions required in furtherance
hereof or thereof and (ii) against the adoption of any Acquisition
Proposal. In addition to the other covenants and agreements
of such Stockholder provided for elsewhere in this Agreement, from
the execution of this Agreement until the first to occur of the
Effective Time or the Termination Date, none of the Stockholders
shall amend, waive, cancel or terminate the Securityholders’
Agreement or enter into any agreement, arrangement or understanding
with any Person or entity to refrain from taking any of the actions
described in clause (i) or (ii) of the foregoing sentence, or the
effect of which would be inconsistent with or violate the
provisions and agreements contained in this Section 4 , in
any case without the p
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