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EXHIBIT 10.1
COMMON STOCK PURCHASE AGREEMENT
THIS
COMMON STOCK PURCHASE AGREEMENT (this "Agreement") is made and
entered into effective as of June 27, 2005,
by and between TRANS-INDUSTRIES,
INC., a Delaware corporation (the
"Company"), and CLARK-RELIANCE CORPORATION, a
Delaware corporation (the "Purchaser").
WHEREAS,
the Company desires to issue and sell to the Purchaser, and the
Purchaser desires to purchase from the
Company, newly issued shares of the
Company's Common Stock, par value $0.10 per
share (the "Common Stock"), at the
price per share and upon and subject to the
other terms and conditions set forth
in this Agreement;
ACCORDINGLY, the Company and the Purchaser hereby agree as
follows:
1. AUTHORIZATION OF SALE
OF THE COMMON STOCK
The
Company has authorized the issuance and sale to the Purchaser
of
shares of Common Stock with an aggregate
value of $250,000, as determined in
Section 2.2 below, all upon and subject to
the terms and conditions set forth in
this Agreement.
2. AGREEMENT TO SELL AND
PURCHASE THE COMMON STOCK
2.1
PURCHASE AND SALE
Upon the
terms and subject to the terms and conditions set forth in this
Agreement, at the Closing (as defined
below), the Company shall issue and sell
to the Purchaser, and the Purchaser shall
purchase from the Company, 384,615
shares of Common Stock. The shares of
Common Stock to be issued and sold by the
Company to the Purchaser hereunder are
referred to herein collectively as the
"Purchased Shares."
2.2
PURCHASE PRICE
The total
purchase price payable to the Company by the Purchaser for all
of the Purchased Shares to be issued and
sold to such Purchaser hereunder shall
be equal to $250,000. The per share
purchase price of the Purchased Shares shall
be $0.65 (equal to the higher of (1) the
average closing purchase price of the
Common Stock as listed on the NASDAQ
SmallCap Market for the 30 calendar day
period preceding the Closing Date (as
defined below); or (2) the listed closing
price on the day before the Closing
Date.)
2.3 USE OF
PROCEEDS
The
Company shall use the proceeds of the sale of the Purchased Shares
to
pay the fees and expenses incurred by the
Company in connection with the
transactions contemplated by this Agreement
and to redeem shares of the
Company's Series A Preferred Stock, par
value One Dollar ($1.00) ("Series A
Preferred Stock"), from the Company's
Profit Sharing Plan.
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3. THE CLOSING; CLOSING
ACTIONS
3.1 THE
CLOSING
The
consummation of the purchase and sale of the Purchased Shares and
the
other transactions and deliveries
contemplated by this Agreement (the "Closing")
shall take place at the offices of Calfee,
Halter & Griswold LLP at 1400
McDonald Investment Center, 800 Superior
Avenue, Cleveland, Ohio 44114,
simultaneously with the execution and
delivery of this Agreement by the Company
and the Purchaser on the date of this
Agreement (the "Closing Date").
3.2
CLOSING ACTIONS
In
connection with the execution and delivery of this Agreement,
except as
specifically set forth below, the following
actions shall occur simultaneously
with, or prior to, the execution and
delivery of this Agreement (the "Closing
Actions").
(i) The Company shall deliver to the Purchaser a certificate of
the
Secretary of State of the State of
Delaware, dated as of the Closing Date, as to
the status of the Company as a corporation
in good standing under the laws of
the State of Delaware as of the Closing
Date.
(ii) The Company shall deliver to the Purchaser a certificate
executed by its Secretary, in form and
substance satisfactory to the Purchaser,
certifying the resolutions authorizing the
transactions contemplated by this
Agreement and certain incumbency
matters.
(iii) Within ten days of the Closing Date, the Company shall
deliver
to the Purchaser one or more certificates
or other instruments representing the
Purchased Shares being purchased by the
Purchaser at the Closing pursuant to
Section 2.1, which certificates and
instruments shall be in a form satisfactory
to the Purchaser and registered in the name
of the Purchaser or such nominee or
nominees as the Purchaser may designate in
writing to the Company, against
receipt by the Company of payment of the
full amount of the Purchase Price for
the Purchased Shares either by check or by
wire-transfer of immediately
available funds to the Company in
accordance with wire-transfer instructions
furnished by the Company to the Purchaser
at least two business days prior to
the Closing Date.
4. REPRESENTATIONS,
WARRANTIES AND COVENANTS OF THE COMPANY
Except (i)
as disclosed in any Exchange Act Filings (as defined in Section
4.8 below) filed by the Company with the
SEC subsequent to December 31, 2004 or
(ii) as disclosed in the Schedule of
Exceptions attached to this Agreement as
Exhibit I, the Company hereby represents
and warrants to the Purchaser as
follows (which representations and
warranties shall be deemed to apply, where
appropriate, to each subsidiary of the
Company):
4.1
ORGANIZATION AND QUALIFICATION
The
Company is a corporation that has been duly incorporated and is
validly existing and in good standing under
the laws of the State of Delaware.
The Company has all requisite corporate
power and authority to own and operate
its properties and assets and to conduct
its
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business as it is presently being conducted
and as it is proposed to be
conducted. The Company is duly qualified as
a foreign corporation to transact
business in, and is in good standing in,
each jurisdiction in which its
ownership, lease or operation of its
properties or assets, the nature of its
activities or the conduct of its business
makes such qualification necessary,
except for any failure or failures to be so
qualified could not, individually or
in the aggregate, reasonably be expected to
result in a material adverse effect
on the condition, financial or otherwise,
or the earnings, assets, liabilities,
business or prospects of the Company.
Except as disclosed in Section 4.7(d), the
Company is not in violation or breach of
any of the terms, conditions or
provisions of such Certificate of
Incorporation or By-Laws.
4.2
AUTHORIZATION
The
Company has all requisite corporate power and authority to execute
and
deliver (a) this Agreement, and (b) the
Purchased Shares (collectively, the
"Transaction Documents"), and to perform
its obligations under the Transaction
Documents. The execution and delivery by
the Company of each of the Transaction
Documents and the performance by the
Company of its obligations thereunder have
been duly authorized by all necessary
corporate action on its part, and no other
corporate proceedings on its part are
necessary to authorize its execution and
delivery of the Transaction Documents or
its performance of its obligations
under the Transaction Documents.
4.3
PURCHASED SHARES
The
Purchased Shares and the issuance, sale and delivery thereof upon
the
terms and conditions set forth in this
Agreement have been duly authorized by
all requisite action of the Board of
Directors of the Company and all requisite
stockholder action. When issued and
delivered to the Purchaser upon the terms
and conditions of this Agreement (and paid
for as contemplated by this
Agreement), the Purchased Shares will be
validly issued and fully paid and
nonassessable, with no personal liability
attached to the ownership thereof and
not subject to any preemptive rights,
rights of first refusal or other similar
rights of any stockholder of the Company or
any other person, and, based upon
the representations and warranties of the
Purchaser set forth in Section 5 of
this Agreement, shall have been issued in
compliance with all applicable
securities laws.
4.4 DUE
EXECUTION AND DELIVERY; BINDING OBLIGATIONS
Each
Transaction Document has been duly executed and delivered by
the
Company, and each such Transaction Document
constitutes the legal, valid and
binding obligation of the Company,
enforceable against the Company in accordance
with its terms, except as such enforcement
may be limited by bankruptcy,
insolvency, reorganization, moratorium,
fraudulent transfer or conveyance or
similar laws relating to or limiting
creditors' rights generally or by equitable
principles relating to enforceability and
except as rights of indemnity or
contribution may be limited by federal or
state securities or other laws or the
public policy underlying such laws.
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4.5 NO
CONFLICT OR VIOLATION
The
execution and delivery by the Company of each Transaction
Document,
and the performance by the Company of its
obligations under each Transaction
Document, will not result in any conflict
with, or result in a violation or
breach of any of the terms, conditions or
provisions of, or constitute (with or
without due notice, lapse of time or both)
a default under, or give rise to a
right of termination, cancellation or
acceleration of any obligation under, or
result in the creation of any lien upon any
of the properties or assets of the
Company or any of its subsidiaries under,
(i) the Certificate of Incorporation
or the By-Laws of the Company, or the
certificate of incorporation, articles of
incorporation or by-laws of any subsidiary
of the Company, (ii) any material
contract to which the Company or any of its
subsidiaries is a party or to which
any of their respective properties or
assets is subject; or (iii) any law,
statute, ordinance, rule, regulation,
judgment, order, decree, license or permit
applicable to the Company or any of its
subsidiaries or to which any of their
respective properties or assets is
subject.
4.6
CONSENTS AND APPROVALS
The
execution and delivery by the Company of each Transaction
Document,
and the performance by the Company of its
obligations under each Transaction
Document, do not and will not require any
consent, approval, license, permit,
order or authorization of, or any
registration, notification, declaration or
filing with, any person (including any
securities exchange or self-regulatory
organization or any governmental agency,
entity or authority), except for (i)
such as have been obtained or made and are
in full force and effect as of the
Closing, (ii) the filing of any notice with
respect to the Closing with any
governmental agency, entity or authority
which may be required subsequent to the
Closing under the Securities Act of 1933,
as amended (the "Securities Act"), any
state securities laws, or the rules and
regulations promulgated thereunder (and
which, if required, will be filed on a
timely basis as may be so required), and
(iii) the approval of the shareholders of
the Company which may be required by
NASD listing standards.
4.7
CAPITALIZATION
(a) All
outstanding shares of capital stock of the Company of every
class
and series have been duly authorized and
validly issued, free of any preemptive
or similar rights except such as have been
fully complied with, and are fully
paid and nonassessable, with no liability
attaching to the ownership thereof.
(b) Except
as set forth in Section 4.7(d) below and the (x) Certificate of
Incorporation, (y) the two Stock Purchase
Agreements entered into in 2005 by and
between the Company and Dale S. Coenen and
Delmer Fields, respectively, or (z)
the Registration Rights Agreement, the
Investor Rights Agreement, the Right of
First Refusal Agreement, or the Voting
Agreement (all of which were entered into
by the Company and the various other
parties thereto as of March 4, 2004, as
they may have been amended), there are no
outstanding (i) rights of first offer
or first refusal, "drag-along" rights,
"tag-along" rights or other similar
rights or agreements, arrangements or
commitments of any character which
obligate the Company or any of its
subsidiaries, or, to the knowledge of the
Company, any stockholder of the Company or
other person, to transfer, sell or
vote any Company Securities (as defined
below), (ii) obligations on
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the part of the Company or any of its
subsidiaries to repurchase, redeem or
otherwise acquire any Company Securities,
(iii) liabilities on the part of the
Company or any of its subsidiaries for
dividends declared or accumulated but
unpaid with respect to Company Securities,
(iv) obligations on the part of the
Company or any of its subsidiaries to
register for public sale any Company
Securities, and (v) obligations on the part
of the Company or any of its
subsidiaries or, to the knowledge of the
Company, of any stockholder of the
Company or other person for the voting of
Company Securities in any manner
whatsoever. "Company Securities" means (i)
shares of capital stock or other
voting securities of the Company, (ii)
securities of the Company or any of its
subsidiaries convertible into or
exchangeable for shares of capital stock or
voting securities of the Company, and (iii)
options, warrants or other rights to
acquire from the Company or any of its
subsidiaries.
(c) Except
as set forth in (x) the 1996 Stock Option Plan with respect to
options granted or to be granted
thereunder, (y) warrants beneficially owned by
Harry E. Figgie, Jr. or (z) the Certificate
of Incorporation, no Company
Securities will become issuable to any
Person, nor will the conversion or
exercise price or exchange factor or ratio
of any Company Securities be reduced,
pursuant to any so-called "anti-dilution"
or similar adjustment provisions of
any Company Securities or pursuant to any
agreements, arrangements or
commitments to which the Company or any of
its subsidiaries is a party.
(d) The
Company has no liability whatsoever to any stockholder, former
stockholder or other person, whether fixed
or variable, accrued or contingent,
for the payment of any dividends, whether
or not declared and whether cumulative
or non-cumulative, except for the Company's
liability for cumulative dividends
accrued with respect to the shares of the
Series A Preferred Stock, presently
issued and outstanding in accordance with
the terms thereof as set forth in the
Certificate of Incorporation. None of such
dividends are currently due or
payable, and the total amount of the
Company's liability for such accrued
cumulative dividends on the Prior Preferred
Stock as of May 31, 2005, was
$625,282.19.
(e) All
shares of capital stock and other equity or debt securities of
the
Company and its subsidiaries (including any
predecessors of the Company and such
subsidiaries) issued prior to the Closing
have been offered, sold and issued
either pursuant to an effective
registration statement under the Securities Act
of 1933, as amended (the "Securities Act"),
or in a transaction exempt from
registration under the Securities Act, and
in compliance with all applicable
state securities laws and all rules and
regulations promulgated under the
Securities Act and applicable state
securities laws. Neither the Company nor any
of its subsidiaries nor any predecessor
thereof has violated the Securities Act
or any applicable state securities laws or
any rules or regulations promulgated
thereunder in connection with the issuance,
sale and delivery of any securities.
4.8
EXCHANGE ACT FILINGS
The
Company has timely filed all documents required to be filed by
the
Company (the "Exchange Act Filings") with
the Securities and Exchange Commission
(the "SEC") pursuant to the Securities
Exchange Act of 1934, as amended, and the
rules and regulations promulgated
thereunder (the "1934 Act"). As of their
respective filing dates, all Exchange Act
Filings complied in all material
respects with the requirements of the 1934
Act, and none of the
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Exchange Act Filings contained any untrue
statement of a material fact or
omitted to state a material fact required
to be stated therein or necessary to
make the statements made therein, in light
of the circumstances in which they
were made, not misleading. All financial
statements of the Company included in
any Exchange Act Filings complied as to
form in all material respects with the
then applicable accounting requirements and
with the published rules and
regulations of the SEC with respect
thereto, were prepared in accordance with
generally accepted accounting principles
applied on a consistent basis during
the periods involved ("GAAP") (except as
may be indicated in the notes thereto
or, in the case of unaudited statements, as
permitted by Form 10-Q and
Regulation S-X) and fairly present the
consolidated financial position of the
Company and its consolidated subsidiaries
as of the dates thereof and the
consolidated results of their operations
and changes in financial position for
the periods then ended (subject, in the
case of unaudited statements, to
normally, recurring year-end audit
adjustments).
4.9
FINANCIAL STATEMENTS
All
financial statements of the Company included, whether as exhibits
or
otherwise, or incorporated by reference in
the Exchange Act Filings have been
prepared from and in accordance with the
books and records of the Company and
its subsidiaries (which have been
maintained in accordance with good business
practices and are true and complete in all
material respects), and fairly
present in all material respects the
consolidated financial position and
consolidated results of operations,
stockholders' equity and cash flows of the
Company and its subsidiaries as of the
respective dates thereof and for the
respective periods indicated therein in
accordance with GAAP, subject, in the
case of any unaudited financial statements
included among such financial
statements, to normal, recurring year-end
adjustments (which adjustments are not
material, individually or in the aggregate)
and the lack of footnotes and other
presentation items required by GAAP. Since
January 1, 2005, except as required
by applicable law or GAAP, there has been
no change in any accounting principle,
procedure or practice followed by the
Company or any of its subsidiaries or in
the method of applying any such principle,
procedure or practice.
4.10
UNDISCLOSED LIABILITIES
The
Company and its subsidiaries do not have any liabilities or
obligations whatsoever (whether matured or
unmatured, known or unknown, fixed or
contingent or otherwise) of a type required
to be reflected on or reserved
against in, or to be disclosed in the notes
to, a balance sheet prepared in
accordance with GAAP, except (i) to the
extent expressly reflected on or
reserved against in, or otherwise disclosed
in the notes to, the Company's
audited consolidated financial statements
as of and for the period ended
December 31, 2004 (the "Latest Audited
Financial Statements"), as set forth in
the company's Annual Report on Form 10-K as
filed with the SEC pursuant to the
1934 Act (the "Annual Report"), (ii) for
those liabilities or obligations
expressly disclosed or reflected in
Exchange Act Filings filed by the Company
with the SEC subsequent to the Annual
Report, and (iii) for those liabilities or
obligations arising since December 31, 2004
in the ordinary course of business
consistent (in amount and kind) with past
practice, none of which, except as
expressly set forth in any Exchange Act
Filings filed by the Company with the
SEC subsequent to the Annual Report, is a
liability or obligation arising from
any breach of contract, breach of warranty,
tort, infringement claim, violation
of law or any action, suit or
proceeding.
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4.11 NO
MATERIAL CHANGE
Since
December 31, 2004,
(a) there
has been no material adverse change or any development
involving
a prospective material adverse effect on or
affecting the condition, financial
or otherwise, or the earnings, assets,
liabilities, business or prospects of the
Company, whether or not arising in the
ordinary course of business;
(b) there
have been no transactions entered into by the Company other
than
those in the ordinary course of business,
which are material with respect to the
Company; and
(c) there
has been no dividend or distribution of any kind declared, paid
or made by the Company on or with respect
to any class or series of its capital
stock, nor has the Company repurchased or
redeemed any shares of its capital
stock.
4.12
ENVIRONMENTAL MATTERS
Except as
could not, individually or in the aggregate, reasonably be
expected to have a material adverse effect
on the condition, financial or
otherwise, or the earnings, assets,
liabilities, business or prospects of the
Company,
(a) the
Company is in compliance with all applicable Environmental Laws
(as defined below);
(b) the
Company has all permits, authorizations and approvals required
under any applicable Environmental Laws and
is in compliance with the
requirements of such permits authorizations
and approvals;
(c) there
are no pending or, to the knowledge of the Company, threatened
Environmental Claims (as defined below)
against the Company; and
(d) under
applicable law, there are no circumstances with respect to any
property or operations of the Company that
are reasonably likely to form the
basis of an Environmental Claim against the
Company.
For
purposes of this Agreement, the following terms shall have the
following meanings: "Environmental Law"
means any federal, state, local or
municipal statute, law, rule, regulation,
ordinance, code, policy or rule of
common law and any judicial or
administrative interpretation thereof, including
any judicial or administrative order,
consent decree or judgment, relating to
the environment, human health or safety, or
any chemical, material or substance,
exposure to which is prohibited, limited or
regulated by any governmental
authority. "Environmental Claims" means any
and all administrative, regulatory
or judicial actions, suits, demands, demand
letters, claims, liens, notices of
noncompliance or violation, investigations
or proceedings relating in any way to
any Environmental Law.
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4.13 NO
DEFAULTS
The
Company is not in material default in the performance or observance
of
any obligation, agreement, covenant or
condition contained in any contract,
indenture, mortgage, loan agreement, deed,
trust, note, lease, sublease, voting
agreement, voting trust, or other
instrument or agreement to which the Company
is a party or by which it may be bound, or
to which any of the property or
assets of the Company is subject, except
for any such defaults as could not,
either individually or in the aggregate,
reasonably be expected to result in a
material adverse effect on or affecting the
condition, financial or otherwise,
or in the earnings, assets, liabilities,
business or prospects of the Company.
4.14 LABOR
MATTERS
There
exists no material dispute with any employees or group of
employees
of the Company, whether or not covered by
any collective bargaining agreement,
and, to the knowledge of the Company, no
such dispute is or has been threatened.
4.15 NO
ACTIONS
There are
no actions, suits, proceedings or investigations before or by
any court or governmental agency or body,
domestic or foreign, now pending, or,
to the knowledge of the Company, threatened
against or affecting the Company
which if determined adversely to the
Company could, either individually or in
the aggregate, reasonably be expected to
result in a material adverse effect on
the condition, financial or otherwise, or
the earnings, assets, liabilities,
business or prospects of the Company or
which relates in any way to the
transactions contemplated by this
Agreement, nor, to the knowledge of the
Company, is there any reasonable basis for
any such action, suit or proceeding.
Neither the Company nor any of its
subsidiaries is in default with respect to
any judgment, order or decree of any court
or governmental agency or
instrumentality applicable the Company or
any such subsidiary.
4.16
INTELLECTUAL PROPERTY
(a) The
Company owns or is licensed to use or otherwise possesses the
legal right to use all patents, patent
applications, inventions, trademarks,
trade names, applications for registration
of trademarks, service marks, service
mark applications, copyrights, know-how,
manufacturing processes, formulae,
trade secrets, licenses and rights in any
thereof and any other in
