SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
Schedule 13D
Under the Securities Exchange Act of 1934
Hudson Technologies, Inc.
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(Name of Issuer)
Common Stock, par value $0.01
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(Title of Class of Securities)
444144-10-9
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(CUSIP Number)
John W. Ward, Esq.
E. I. du Pont de Nemours and Company
1007 Market St.
Wilmington, DE 19898
(302) 774-4103
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(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
January 29, 1997
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(Date of Event which Requires Filing
of this Statement)
If the filing person has previously filed a statement on Schedule 13G to
report the acquisition which is the subject of this Schedule 13D, and is
filing this schedule because of Rule 13d-1(b)(3) or (4), check the following
box [ ].
Note: Six copies of this statement, including all exhibits, should be filed
with the Commission. See Rule 13d-1(a) for other parties to whom copies are
to be sent.
*The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities,
and for any subsequent amendment containing information which would alter
disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be
deemed to be "filed" for the purpose of Section 18 of the Securities Exchange
Act of 1934 ("Act") or otherwise subject to the liabilities of that section of
the Act but shall be subject to all other provisions of the Act (however, see
the Notes).
<PAGE>
This Schedule 13D is filed pursuant to Rule 13d-1 of the
Rules and Regulations under the Securities Exchange Act of 1934,
as amended (the "Exchange Act") by E. I. du Pont de Nemours and
Company, a Delaware corporation ("DuPont") and by Du Pont
Chemical and Energy Operations, Inc., a Delaware corporation and
wholly owned subsidiary of DuPont ("DCEO"), with respect to the
common stock of Hudson Technologies, Inc., a New York corporation
("HDSN" or the "Issuer"):
Item 1. Security and Issues.
This Schedule 13D relates to the Common Stock, par value
$0.01 per share ("Common Stock"), of HDSN. The principal
executive offices of HDSN are located at 25 Torne Valley Road,
Hillburn, New York 10931-9900.
Item 2. Identity and Background.
This Schedule 13D is filed by DuPont and by DCEO. The
principal executive offices of both corporations are located at
1007 Market Street, Wilmington, Delaware 19898.
DuPont is one of the two largest United States chemical
producers and is one of the leading chemical producers worldwide.
It conducts fully integrated petroleum operations primarily
through its wholly owned subsidiary Conoco Inc. and, in 1994,
ranked eighth in the worldwide production of petroleum liquids by
U.S.-based companies, tenth in the production of natural gas, and
sixth in refining capacity. Conoco Inc. and other subsidiaries
and affiliates of DuPont conduct exploration, production, mining,
manufacturing or selling activities, and some are distributors of
products manufactured by DuPont. DuPont operates globally
through approximately twenty strategic business units. Within
the strategic business units approximately 85 businesses
manufacture and sell a wide range of products to many different
markets, including the energy, transportation, textile,
construction, automotive, agricultural, printing, health care,
packaging and electronics markets. DuPont and its subsidiaries
have operations in about 70 nations worldwide and, as a result,
approximately 50% of consolidated sales are derived from sales
outside the United States, based on the location of the corporate
unit making the sale. Total worldwide employment at year-end
1995 was about 105,000 people.
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DCEO was incorporated in Delaware in 1988 and is limited
by its certificate of incorporation to the making, maintenance
and management of its intangible investments and the collection
and distribution of the income from such investments. DCEO is a
wholly owned subsidiary of DuPont.
Information concerning the directors and executive
officers of DuPont and DCEO is contained in Schedule A attached
hereto.
During the last five years, none of DuPont or DCEO nor, to
the best knowledge of DuPont and DCEO, any director or executive
officer of DuPont or DCEO has been (i) convicted in a criminal
proceeding or (ii) a party to a civil proceeding of a judicial or
administrative body of competent jurisdiction and as a result of
such proceeding has been or is subject to a judgment, decree or
final order enjoining future violations of, or prohibiting or
mandating activities subject to, federal or state securities laws
or finding any violation with respect to such laws.
Item 3. Source and Amount of Funds or Other Consideration.
DCEO purchased 500,000 of HDSN common stock in a private
placement from HDSN pursuant to a Stock Purchase Agreement dated
January 29, 1997, for a cash payment of $3,500,000, all of which
was obtained from cash provided by DCEO's holdings.
Item 4. Purpose of Transaction.
Reference is made to the agreements discussed in Item 6
below (collectively, the "Agreements").
On January 29, 1997, DuPont and HDSN formed a strategic
alliance pursuant to which HDSN will provide refrigerant
recovery, reclamation, separation, packaging and testing services
directly to DuPont for marketing through the DuPont
Fluoroproducts Business authorized distribution network. In
addition, HDSN will market DuPont refrigerant products to
selected market segments together with HDSN reclamation and
refrigerant management services. Concurrent with the alliance,
DCEO acquired 500,000 shares of HDSN common stock in order to
enable DCEO to obtain a substantial equity interest in HDSN.
Based upon publicly available information, DCEO believes that it
will be the largest HDSN shareholder. Accordingly, DCEO may in
<PAGE>
the future seek representation on HDSN's Board of Directors
pursuant to the Agreements discussed below.
Except as noted above regarding potential future
representation on HDSN's Board of Directors, DuPont and DCEO
currently have no present plans or proposals of a type which
would be required to be disclosed in this Statement. Neither
DuPont nor DCEO have any present plans to acquire additional
shares, but they may do so (to the extent permitted under the
Agreements) depending upon future market conditions and other
factors. DuPont and DCEO also reserve the right to dispose of
some or all of the shares presently owned (as permitted by the
Agreements), but each of them have no present plans in this
regard.
Item 5. Interest in Securities of the Issuer.
As of January 29, 1997, DCEO directly owns 500,000 shares
of Common Stock of the HDSN. Such shares constitute
approximately 10 percent of the total number of shares of Common
Stock outstanding as of such date. No director or executive
officer of DuPont or DCEO beneficially owns any shares of Common
Stock of the HDSN.
Item 6. Contracts, Arrangements, Understandings or
Relationships With Respect to Securities of the
Issuer.
DuPont, DCEO, HDSN and certain HDSN stockholders have
entered into several agreements dated as of January 29, 1997 (the
"Agreements"), which are filed as exhibits to this Agreement.
Reference is made to such exhibits for the complete text of the
Agreements, and the following description of the Agreements is
qualified by such reference.
The Agreements provide, among other things, that, during
their term:
(1) As a general matter, DuPont and its subsidiaries
(collectively, the "DuPont Group") will not acquire voting
securities of HDSN if the effect of such acquisition would be to
increase the ownership of the DuPont Group to more than 20% of
<PAGE>
the combined voting power of all voting securities of HDSN at the
time outstanding. DuPont will be relieved of this restriction if
(a) any other person acquires, or makes a tender or exchange
offer for, HDSN voting securities representing more than 20% of
the combined voting securities at the time outstanding, (b) it is
publicly disclosed or DuPont otherwise learns that voting
securities representing more than 20% of the total voting power
have been acquired subsequent to January 1, 1997, or are proposed
(in a public announcement or filing) to be acquired subsequent to
such date by any person or group, or (c) any person shall
beneficially own voting securities representing a percentage of
total voting power which exceeds the greater of (x) 10% or (y)
the percentage of total voting power represented by the DuPont
voting power at such time, or (d) pursuant to its rights to
purchase voting securities under the Shareholders Agreement
between DCEO, DuPont, the Company and certain principal
shareholders of the Company dated January 29, 1997 (the
"Shareholders Agreement").
(2) No member of the DuPont Group will solicit proxies or
become a "participant" in a "solicitation" (as those terms are
defined in Regulation 14A under the Securities Act of 1934) in
opposition to the recommendation of the majority of the directors
of HDSN with respect to any matter, except that if DuPont may
oppose any solicitation by HDSN's management with respect to any
Significant Event. For this purpose, the term "Significant
Event" means any charter or bylaw amendment (other than a
proposal to require cumulative voting in the election of
directors), acquisition or disposition of assets (by way of
merger, consolidation or otherwise), change in capitalization,
liquidation, or other action out of the ordinary course of
business of HDSN.
(3) No member of the DuPont Group will offer, sell or
transfer any HDSN voting securities without offering HDSN a right
of first refusal in the manner specified in the Agreements,
except that these provisions will not apply to transfers (a) to
any member of the DuPont Group, (b) pursuant to a bona fide
public offering, registered under the Securities Act of 1933 (the
"Act"), so long as no sales are made to any person or related
group who would thereafter own more than 5% of the total combined
voting power of HDSN voting securities then outstanding, or (c)
pursuant to Rule 144 under the Act"), so long as no sales are
made to any person or related group who would thereafter own more
than 5% of the total combined voting power of HDSN voting
securities then outstanding.
(4) Upon DuPont and DCEO's written request, two designees
of DuPont and DCEO will be elected to the HDSN Board of
<PAGE>
Directors, provided that the DuPont Group continues to
beneficially own 50% of the HDSN shares purchased.
(5) HDSN will not take or recommend to its shareholders
without DuPont's consent any action which would impose
limitations on the legal rights of the DuPont Group as HDSN
shareholders other than those imposed pursuant to the express
terms of the Agreements, provided that the DuPont Group continues
to beneficially own 50% of the HDSN shares purchased.
(6) HDSN will provide to DCEO a "demand" registration
right if DCEO should desire to dispose of its shares after
January 29, 1999.
(7) DuPont and DCEO have agreed with certain other HDSN
shareholders not to sell any HDSN shares for one year, except for
certain de minimus sales by such HDSN shareholders into the
public market pursuant to any registered public offering or Rule
144 under the Securities Act of 1933.
(8) Pursuant to the Shareholders' Agreement, such HDSN
shareholders have provided DuPont and DCEO certain rights of
first refusal to buy shares of HDSN currently held or later
acquired pursuant to stock options currently held by such
shareholders along with certain rights to include shares held by
the DuPont Group in certain sales by any such shareholder to
certain third parties, and such HDSN shareholders have agreed to
vote their shares for any DuPont and DCEO designees to the HDSN
Board of Directors as discussed above.
The term of the Standstill Agreement expires on January
29, 2002. Upon termination of the Agreement, all covenants of
the parties expire. The Agreement may be terminated prior to the
stated termination date if (a) a party defaults in its
obligations or (b) DuPont's designees are not elected. If this
termination notice is given, any of DuPont's designees will
resign from the HDSN Board. The term of the Shareholders'
Agreement expires on January 29, 2002, unless prior thereto the
DuPont Group does not continue to beneficially own at least 50%
of the HDSN shares purchased.
Except for the foregoing agreements and the alliance
agreements discussed above, there are no other contracts,
arrangements, understandings or relationships (legal or
<PAGE>
otherwise) among the persons named in Item 2 and between such
persons and any person with respect to any securities of HDSN.
Item 7. Material to be Filed as Exhibits.
The following agreements are filed as an exhibit to this
Schedule 13D.
A. Agreement dated February 5, 1997, between
DuPont and DCEO in which both agree that this
Schedule is filed on behalf of both of them.
B. Stock Purchase Agreement dated January 29,
1997.
C. Shareholders' Agreement dated January 29, 1997.
D. Standstill Agreement dated January 29, 1997.
E. Registration Agreement dated January 29, 1997.
<PAGE>
SIGNATURE
After reasonable inquiry and to the best of my knowledge
and belief, I certify that the information set forth in this
Statement is true, complete and correct.
E. I. DU PONT DE NEMOURS AND
COMPANY
By: /s/ JOHN C. SARGENT
-------------------------------
John C. Sargent
Vice President and Treasurer
DU PONT CHEMICAL AND ENERGY
OPERATIONS, INC.
By: /s/ C. L. DOWNING
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C. L. Downing
Vice President
<PAGE>
SCHEDULE A
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1. Set forth below are the name, address and present
principal occupation or employment with E. I. du Pont de Nemours
and Company of each director and executive officer. With the
exception of Percy N. Barnevik, who is a Swedish Citizen, each
person listed below is a citizen of the United States of America.
NAME AND ADDRESS POSITION
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Directors:
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Percy N. Barnevik Chairman and Chief Executive
ABB Asea Brown Boveri Ltd. Officer
P.O. Box 8131 ABB Asea Brown Boveri Ltd.
CH-8050
Zurich Switzerland
Andrew F. Brimmer President and Director
Brimmer & Company, Inc. Brimmer & Company, Inc.
4400 MacArthur Blvd., NW
Suite 302
Washington, DC 20007
Louisa C. Duemling Director
c/o John Thayer
1100 DuPont Building
1007 Market Street
Wilmington, DE 19898
Archie W. Dunham* Director
Conoco Inc.
PE-3034
600 North Dairy Ashford
Houston, TX 77079
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* Also President and Chief Executive Officer of Conoco, Inc. and
an Executive Officer of DuPont
<PAGE>
NAME AND ADDRESS POSITION
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Directors:
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Edward B. du Pont Director
1011 Wilmington Trust Center
Wilmington, DE 19801
Charles M. Harper Director
Suite 1500
One Central Park Plaza
Omaha, NE 68102
Lois D. Juliber President
Colgate-Palmolive Colgate-Palmolive
300 Park Avenue North America
New York, NY 10022 Colgate-Palmolive Company
John A. Krol * Director
Administration
9000 DuPont Building
1007 Market Street
Wilmington, DE 19898
William K. Reilly Visiting Professor
Institute for International Stanford University
Studies
Encina Hall, Room 200
Stanford University
Stanford, CA 91305-6055
H. Rodney Sharp, III Director
9000 Du Pont Building
1007 Market Street
Wilmington, DE 19898
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* Also President and Chief Executive Officer of DuPont
<PAGE>
NAME AND ADDRESS POSITION
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Directors:
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Charles M. Vest President
111 Memorial Drive Massachusetts Institute of
Cambridge, MA 02142 Technology
Edgar S. Woolard, Jr. Chairman of the Board
Administration
9000 DuPont Building
1007 Market Street
Wilmington, DE 19898
Executive Officers:
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Jerald A. Blumberg Executive Vice President
Administration
9000 DuPont Building
1007 Market Street
Wilmington, DE 19898
Archie W. Dunham Executive Vice President
Conoco Inc.
PE-3034
600 N. Dairy Ashford
Houston, TX 77079
Gary W. Edwards Senior Vice President
Conoco Inc.
PE-3052
600 N. Dairy Ashford
Houston, TX 77079
Kurt Landgraf Executive Vice President
DuPont Finance
D-8000
1007 Market Street
Wilmington, DE 19898
<PAGE>
NAME AND ADDRESS POSITION
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Executive Officers:
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Charles O. Holliday, Jr. Executive Vice President
DuPont Asia Pacific
9000 DuPont Building
1007 Market Street
Wilmington, DE 19898
John A. Krol President and CEO
Administration
9000 DuPont Building
1007 Market Street
Wilmington, DE 19898
Robert E. McKee, III Senior Vice President
Conoco Inc.
PE-3070
600 N. Dairy Ashford
Houston, TX 77079
Joseph A. Miller Senior Vice President
DuPont Research and Development
E-328/411
Rt. 141 and Henry Clay
Wilmington, DE 19880
Stacey J. Mobley Senior Vice President
DuPont External Affairs
N-9510
1007 Market Street
Wilmington, DE 19898
Howard J. Rudge Senior Vice President
DuPont Legal and General Counsel
D-7038
1007 Market Street
Wilmington, DE 19898
<PAGE>
2. Set forth below are the name, address and principal
occupation or employment with DuPont Chemical and Energy
Operations, Inc. of each director and executive officer. With
the exception of Mireille J. Quirina, who is a French citizen and
Robert Gachot, who is a French citizen, each person listed below
is a citizen of the United States of America.
NAME AND ADDRESS POSITION
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John C. Sargent President and Director
8045 DuPont Building
1007 Market Street
Wilmington, DE 19898
Charles L. Downing Vice President, Treasurer
8045 DuPont Building and Director
1007 Market Street
Wilmington, DE 19898
Robert P. Gachot Director
8045 DuPont Building
1007 Market Street
Wilmington, DE 19898
Mireille J. Quirina Vice President
2, Chemin du Pavillon
P.O. Box 50
Ch-1218 Le Grand Saconnex
Geneva, Switzerland
<PAGE>
EXHIBIT A
AGREEMENT
By this Agreement, the undersigned agree that this Schedule
13D being filed on or about this date with respect to the
ownership by the undersigned of shares of Common Stock of Hudson
Technologies, Inc. is being filed on behalf of each of us.
Dated: FEBRUARY 7, 1997
E. I. DU PONT DE NEMOURS AND
COMPANY
By: /s/ JOHN C. SARGENT
-------------------------------
John C. Sargent
Vice President and Treasurer
DU PONT CHEMICAL AND ENERGY
OPERATIONS, INC.
By: /s/ C. L. DOWNING
-------------------------------
C. L. Downing
Vice President
<PAGE>
EXHIBIT B
STOCK PURCHASE AGREEMENT
This Investment Agreement is made and entered into as
of January 29, 1997, between E. I. DUPONT DE NEMOURS AND COMPANY
("DUPONT"), DU PONT CHEMICAL AND ENERGY OPERATIONS, INC.
("DCEO"), a Delaware corporation and a wholly owned subsidiary of
DUPONT, and "HUDSON TECHNOLOGIES, INC.", a New York corporation
("HTI" or "the Company").
W I T N E S S E T H:
WHEREAS, DUPONT, DCEO and HTI are, simultaneously with
the execution of this Stock Purchase Agreement, entering into a
certain Registration Agreement and a Standstill Agreement
(collectively, the above agreements are hereafter referred to as
the "Agreements"), all of which collectively provide for a
constructive and mutually beneficial relationship between DUPONT,
DCEO and HTI; and
WHEREAS, HTI desires to obtain Three Million Five
Hundred Thousand Dollars ($3,500,000.00) of additional capital by
selling to DCEO Five Hundred Thousand (500,000) unregistered
shares of its common stock, par value $0.01 per share and DCEO
desires to acquire the same, all subject to the terms and
conditions of this Stock Purchase Agreement; and
WHEREAS, certain HTI stockholders, DCEO and DUPONT
are, simultaneously, with the execution of the Agreements,
entering into a Shareholders' Agreement dated as of January 29,
1997, among DCEO, DUPONT and the persons named in Attachment A
thereto relative to their voting for DCEO's nominee to the HTI
Board of Directors and to their future sales of shares of Common
Stock of HTI (hereinafter referred to as the "Shareholders'
Agreement").
NOW, THEREFORE, in consideration of the respective
agreements herein contained and subject to the terms and
conditions set forth herein, the parties agree as follows:
ARTICLE I - DEFINITIONS
The terms set forth below are defined by the section
or article in which they are used in this Agreement and are
<PAGE>
applicable also to the other Agreements referred to herein, as
appropriate.
"Affiliate" 8.2(b)
"Base Balance Sheet" 4.4
"Best knowledge of HTI" 4.17
"Closing" 3.1
"Closing Date" 2.2
"Designated Persons" 4.10(e)
"Governmental Authority" 4.1
"Intellectual Property Rights" 4.10(d)
"Key Employees" 4.12
"Licenses" 4.1(b)
"Securities" 7.5
"Shareholders' Agreement" 5.1(e)
"Shares" 2.1
"Standstill Agreement" 5.1(f)
Day" shall mean any day (other than a Saturday or
Sunday) on which banks are generally open for business in the
City of New York.
ARTICLE II - PURCHASE OF SHARES
2.1 SHARES SUBJECT TO PURCHASE
In consideration of the issuance to DCEO of Five Hundred
Thousand (500,000) shares of unregistered HTI Common Stock
("Shares"), DCEO shall pay to HTI Three Million Five Hundred
Thousand Dollars ($3,500,000.00). The above payment shall be
made by wiring the funds to an account designated in writing by
HTI.
<PAGE>
ARTICLE III -CLOSING
3.1 CLOSING
Subject to the terms and conditions of this Agreement, the
closing (the "Closing") of the sale and purchase of the Shares is
taking place upon the execution of this Agreement.
(a) HTI is delivering to DCEO and DUPONT (i) a duly
executed copy of this Agreement; (ii) the Shares; (iii) a duly
executed copy of the Standstill Agreement; (iv) a duly executed
copy of the Registration Agreement; (v) a duly executed copy of
the Shareholders' Agreement; (vi) duly executed copies of the
Segment Marketing Agreement and the Reclamation Services
Agreement; (vii) an opinion of counsel to HTI; and (viii) the
Certificate of Incorporation, Bylaws, and resolutions of the
Board of Directors of HTI authorizing the execution, delivery and
performance of this Agreement, and each of the other documents
being executed and delivered by HTI in connection herewith,
certified by the secretary of HTI.
(b) DUPONT and DCEO are delivering to HTI (i) the purchase
price (via wire transfer); (ii) a duly executed copy of this
Agreement; (iii) a duly executed copy of the Standstill
Agreement; (iv) a duly executed copy of the Registration
Agreement; (v) a duly executed copy of the Shareholders'
Agreement; (vi) a duly executed copy of the Segment Marketing
Agreement and the Reclamation Services Agreement; (vii) an
opinion of counsel to DUPONT and DCEO; (viii) a Secretary's
Certificate certifying the due authorization of the execution,
delivery and performance of this Agreement and each of the other
documents being executed and delivered by DCEO in connection
herewith; and (ix) a Secretary's Certificate certifying the due
authorization, delivery and performance of this Agreement and
each of the other documents being executed and delivered by
DUPONT in connection herewith.
ARTICLE IV - REPRESENTATIONS AND WARRANTIES OF THE COMPANY
In order to induce DUPONT and DCEO to enter into this
Agreement, the Company represents and warrants as follows:
<PAGE>
4.1 ORGANIZATION AND CORPORATE POWER
(a) The Company is a corporation duly organized, validly
existing and in good standing under the laws of New York, and is
qualified to do business as a foreign corporation in each
jurisdiction in which such qualification is required, except
where the failure to do so qualify would not have a material
adverse effect on the Company ("Material Adverse Effect"). The
Company has all required corporate power and authority to own its
property, to carry on its business as presently conducted, to
enter into and perform this Agreement and to carry out the
transactions contemplated hereby. The copies of the Certificate
of Incorporation and Bylaws of the Company, as amended to date,
which have been furnished to counsel for DUPONT and DCEO by the
Company, are correct and complete at the date hereof. The minute
books of the Company are true and complete. No consent, approval,
order, license, permit or authorization of, or registration,
declaration or filing with, any governmental authority or any
other person is required to be obtained or made by or with
respect to the Company in connection with the Agreements or the
consummation of the transactions contemplated thereby , except
where the failure to obtain or make would not have a Material
Adverse Effect on the Company.
(b) Except as provided in Schedule 4.1, the Company and
its properties, assets, operations and business are in compliance
in all material respects with all applicable statutes, laws,
ordinances, rules and regulations of any court, administrative
agency or commission or other governmental authority or
instrumentality, domestic or foreign, of competent jurisdiction
("Governmental Authority") and any filing requirements relating
thereto, including laws and regulations relating to environmental
requirements (such as requirements in respect of air, water and
noise pollution). The Company has obtained all permits, licenses
and other authorizations ("Licenses") which are required with
respect to the operation of its business and the ownership of its
assets under federal, state, local and foreign laws, including
laws relating to pollution or protection of the environment,
except when the failure to obtain would not have a Material
Adverse Effect on the Company, and the Company is in compliance
in all material respects with all terms and conditions of such
permits, licenses and authorizations.
4.2 AUTHORIZATION
The Agreements and all documents and instruments executed
pursuant hereto, are valid and binding obligations of the
<PAGE>
Company, enforceable in accordance with their terms, subject to
applicable bankruptcy, insolvency, reorganization, moratorium and
other laws applicable to creditors' rights and remedies and to
the exercise of judicial discretion in accordance with general
principles of equity. The execution, delivery and performance of
the Agreements and the issuance of the Shares have been duly
authorized by all necessary corporate action of the Company.
4.3 CAPITALIZATION
(a) The authorized and issued capital stock of the Company
are as set forth in Schedule 4.3. All of the presently
outstanding shares of capital stock of the Company have been duly
and validly authorized and issued and are fully paid and
non-assessable. The Shares, when and if issued and delivered as
provided for herein, will be duly authorized, validly issued,
fully paid and nonassessable and free and clear of all liens and
encumbrances.
(b) Except as provided above or in said Schedule 4.3, the
Company has not issued any other shares of its capital stock and
there are no outstanding warrants, options or other rights to
purchase or acquire any of such shares, nor any outstanding
securities convertible into such shares or outstanding warrants,
options or other rights to acquire any such convertible
securities. There are no preemptive rights with respect to the
issuance or sale by the Company of the Company's capital stock.
Except as disclosed in Schedule 4.3, there are no restrictions on
the transfer of the Shares or the Common Stock held by the
Stockholders Group (as defined in the Shareholders' Agreement)
other than those arising from federal and state securities laws
or under this Agreement or the Shareholders' Agreement. The only
subsidiaries of the Company are those set forth in Schedule 4.3,
and the Company does not have any other investments in any other
corporation, trust, partnership or business entity and is not a
party to any joint venture.
(c) Other than as provided in Schedule 4.3, there are no
outstanding rights (other than those of which have been
satisfied) which permit the holder thereof to cause the Company
to file a registration statement under the Securities Act or
which permit the holder thereof to include securities of the
Company in a registration statement filed by the Company under
the Securities Act, and there are no outstanding agreements or
other commitments which otherwise relate to the registration of
<PAGE>
any securities of the Company under the Securities Act. All
securities of the Company heretofore issued and sold by the
Company were issued and sold in compliance with all applicable
Federal and state securities laws. Assuming that the
representations and warranties of DUPONT and DCEO set forth in
Article VII are true and correct, the offering, issuance and sale
of the Shares will be exempt from the registration requirements
of the Securities Act.
4.4 FINANCIAL STATEMENTS
HTI has provided to DCEO its 1995 Annual Report on Form
10-K, its quarterly report on Form 10-Q for the nine month period
ended September 30, 1996, including an income statement and
balance sheet for the nine month period ended September 30, 1996
(the "Base Balance Sheet"), and such financial statements
(including the notes thereto, if any contained in such reports)
(i) are in accordance with the books and records of HTI; (ii)
present fairly the financial position and results of operations
of HTI as of the dates and for the periods indicated; and (iii)
have been prepared in accordance with generally accepted
accounting principles applied on a consistent basis (except as
indicated therein).
4.5 ABSENCE OF UNDISCLOSED LIABILITIES
Except as otherwise specifically disclosed in Schedule 4.5,
the Company does not have any material accrued or contingent
liability or liabilities arising out of any transaction or state
of facts existing prior to the date hereof (whether such
liability is accrued, to become due, contingent, or otherwise)
other than liabilities incurred since said balance sheet in the
ordinary course of business or in connection with this Agreement.
4.6 ABSENCE OF CERTAIN DEVELOPMENTS
Except as specifically disclosed in Schedule 4.6, since the
date of the Base Balance Sheet, there has been (i) no material
adverse change in the financial condition of the Company or in
the assets, liabilities, properties or business of the Company,
(ii) no declaration, setting aside or payment of any dividend or
other distribution with respect to, or any direct or indirect
redemption or acquisition of, any of the capital stock of the
Company, (iii) no waiver of any material valuable right of the
Company or the cancellation of any debt or claim held by the
<PAGE>
Company, (iv) no loan by the Company to any officer, director,
employee or stockholder of the Company, or any agreement or
commitment therefor in excess of $15,000, (v) no increase, direct
or indirect, in the compensation paid or payable to any officer,
director, employee or agent of the Company which increase is in
excess of an annual rate of $50,000, (vi) no material loss,
destruction or damage to any property of the Company, whether or
not insured, (vii) no material labor trouble involving the
Company and no material change in the personnel of the Company or
the terms and conditions of their employment, (viii) no
acquisition or disposition of any assets (or any contract or
arrangement therefor) nor any other transaction by the Company
otherwise than for fair value in the ordinary course of business;
and (ix) no change in the accounting methods, practices or
policies followed by the Company or in the depreciation or
amortization policies or rates theretofore adopted.
4.7 TITLE TO PROPERTIES
The Company has good and marketable title to all of its
properties and assets, subject to existing encumbrances.
4.8 TAX MATTERS
Except as set forth in Schedule 4.8, all federal, state,
county and local taxes due and payable by the Company have been
paid. There are no taxes due to any foreign jurisdictions. The
provisions for taxes on the Base Balance Sheet are sufficient for
the payment of all accrued and unpaid federal, state, county and
local taxes of the Company, whether or not assessed or disputed
as of the date of the Base Balance Sheet. There exist no unpaid
assessments nor any basis for the assessment of additional
federal income taxes on the Company for any fiscal period. All
federal, state, county or local income tax returns of the Company
have either been filed, or valid unexpired extensions to the due
dates have been obtained. The income tax returns of HTI have
never been audited by any federal, state, local or foreign
authorities. HTI has not waived any statute of limitations with
respect to taxes and have not agreed to any extension of time
with respect to any tax assessment or deficiency.
4.9 CONTRACTS AND COMMITMENTS
(a) Except as disclosed in Schedule 4.9, the Company is
not a party to any contract, obligation or commitment which
<PAGE>
involves a potential commitment by HTI in excess of $500,000 or
which is otherwise material and not entered into in the ordinary
course of business and is not obligated under any contract or
agreement or subject to any charter restriction which presently
materially adversely affects its business, properties, assets,
prospects or financial condition. The Company is not in default
under any contract, obligation or commitment the consequences of
which default would have a Material Adverse Effect on the
Company. All agreements terminable by a third party in the event
the Company enters into this Agreement have been brought to
DUPONT's attention.
(b) Except as set forth in Schedule 4.9, HTI is not a
party to any material written or oral
(a) contract with any labor union;
(b) contract for the future purchase of fixed assets
or for the future purchase of materials, supplies or equipment in
excess of normal operating requirements;
(c) contract for the employment of any officer or
director on a full-time basis or any contract with any person on
a consulting basis;
(d) bonus, pension, profit-sharing, retirement, stock
purchase, stock option, or similar plan;
(e) agreement or indenture relating to the borrowing
of money or to the mortgaging, pledging or placement of a lien on
any assets of HTI;
(f) guaranty of any obligation for borrowed money or
otherwise;
(g) lease or agreement under which HTI is lessee of
or holds or operates any property, real or personal, owned by any
other party;
(h) lease or agreement under which HTI is lessor of
or permits any third party to hold or operate any property, real
or personal, owned or controlled by HTI;
<PAGE>
(i) agreement or other commitment under which HTI is
obligated to pay any broker's fees, finder's fees or any such
similar fees, to any third party in excess of $75,000 during the
year ended December 31, 1996;
(k) contract, agreement or commitment under which HTI
has issued, or may become obligated to issue, any shares of
capital stock of HTI, or any warrants, options, convertible
securities or other commitments pursuant to which HTI is or may
become obligated to issue any shares of its capital stock; or any
other contract, agreement, arrangement or understanding which is
material to the business of HTI. HTI has furnished to DUPONT
true and correct copies of all such agreements and other
documents requested by DUPONT or its authorized representatives.
4.10 PROPRIETARY RIGHTS
(a) HTI owns, possesses, has the exclusive or nonexclusive
right, as the case may be, to use, or where useful or necessary,
has made timely and proper application for, all Intellectual
Property Rights (as defined in subsection (d) of this Section
4.10) useful, necessary or required for the conduct of its
business as presently conducted, and HTI has no reason to
believe, and does not believe, that it will be unable to obtain
on reasonable terms all Intellectual Property Rights useful,
necessary or required for the conduct of its business.
(b) Except as set forth in Schedule 4.10, no royalties,
honorariums or fees are payable by HTI to other persons by reason
of the ownership or use of said Intellectual Property Rights.
(c) There is no pending or, to the best knowledge of HTI,
threatened claim or litigation against HTI nor, to the best
knowledge of HTI, does there exist any basis therefor, contesting
the validity or right to use of any of the foregoing, nor has HTI
received any notice that any of said Intellectual Property Rights
or the operation of HTI's business conflicts, or will conflict,
with the asserted rights of others, nor, to the best knowledge of
HTI, does there exist any basis for any such conflict. As used
herein, the term "Intellectual Property Rights" means all
industrial and intellectual property rights, including, without
limitation, patents, patent applications, trademarks, trade
names, fictitious or assumed names, service marks, copyrights,
computer programs and other computer software, certificates of
public convenience and necessity, franchises, licenses, trade
secrets, proprietary processes and formulae.
<PAGE>
(d) To the best knowledge of HTI, no valid claim may be
asserted by any third party against HTI, with respect to (i) the
continued employment by, or association with, HTI of any of the
present officers or employees of or consultants to (said
directors, officers, employees and/or consultants being
hereinafter collectively referred to as the "Designated Persons")
or (ii) the use, in connection with any business presently
conducted by HTI, by any of the Designated Persons of any
information which HTI or any of the Designated Persons would be
prohibited from using, in each case under any prior agreements,
arrangements or other preexisting set of facts, including,
without limitation, any such agreement or arrangement between any
of the Designated Persons and any former employer of any of the
Designated Persons (as the case may be), or any legal or
equitable considerations applicable to, among other things,
unfair competition, trade secrets or proprietary information.
4.11 EFFECT OF TRANSACTIONS
The execution, delivery and performance by the Company of
this Agreement, the Shareholders' Agreement in the form set forth
in Exhibit A, the Standstill Agreement in the form set forth in
Exhibit B, and the Registration Agreement in the form set forth
in Exhibit C will not conflict with or result in any default
under any material contract, obligation or commitment of the
Company, or any charter provision, bylaw or corporate restriction
of the Company, or the creation of any lien, charge or
encumbrance of any material nature upon any of the properties or
assets of the Company, except pursuant to this Agreement. The
Company's execution and delivery of this Agreement and its
performance of the transactions contemplated hereby will not
violate any material instrument, agreement, judgment, decree,
order, statute, rule or regulation of any Governmental Authority
applicable to the Company.
4.12 LITIGATION
Except as disclosed in Schedule 4.12, there is no material
litigation or governmental proceeding or investigation pending
or, to the best knowledge of the Company, threatened against the
Company, which, individually or in the aggregate affects any of
its properties or assets, or to the best knowledge of the
Company, against any of the Company's Officers (collectively, the
"Key Employees"), or which, individually or in the aggregate, if
decided adversely to the Company or such Key Employee, would
<PAGE>
invalidate, or materially hinder the enforceability or
performance of this Agreement or any action taken or to be taken
pursuant hereto.
4.13 STATE SECURITIES LAWS
The Company has complied and will comply in all material
respects with all applicable state "blue-sky" or securities laws
in connection with the issuance and sale of its Common Stock
heretofore and upon the closing of this Agreement.
4.14 INFORMATION SUPPLIED TO DUPONT AND DCEO
Neither this Agreement, the Form 10-K of the year ended
December 31, 1995, the Form 10-Q for the quarter ended September
30, 1996, nor any document, certificate, or written statement
furnished to DUPONT or DCEO by the Company, contains as of the
date hereof any untrue statement of a material fact, and none of
this Agreement or such other documents, certificates and
statements, omits to state a material fact necessary in order to
make the statements contained herein or therein not misleading.
4.15 BROKERAGE
There are no claims for brokerage commissions, finder's
fees or similar compensation in connection with the transactions
contemplated by this Agreement based on any arrangement or
agreement made by or on behalf of the Company.
4.16 DEFINITION OF BEST KNOWLEDGE
As used herein, the term "to the best knowledge of HTI"
shall mean and include (a) actual knowledge of the executive
officers of HTI and (b) that knowledge which a prudent
businessperson could have obtained in the management of his or
her business affairs after making due inquiry and exercising due
diligence with respect thereto. In connection therewith, the
knowledge of any such executive officer of HTI shall be imputed
to be the knowledge of HTI. For purposes of this Agreement,
disclosure of any matters in any Schedule shall be deemed
disclosure for all purposes.
ARTICLE V - CONDITIONS OF PURCHASE
5.1 CONDITIONS TO CLOSING
<PAGE>
DCEO's obligation to purchase and pay for the Shares shall
be subject to compliance by the Company with its agreements
herein contained and to the fulfillment to DUPONT's satisfaction
on or before and at the Closing of the following conditions:
(a) Opinion of the Company Counsel. DUPONT shall have
received from counsel for the Company, Tenzer Greenblatt L.L.P.,
their opinion, dated the Closing Date.
(b) Authorization. The Board of Directors of the Company
shall have duly adopted resolutions in form reasonably
satisfactory to DUPONT authorizing the Company to consummate the
transactions contemplated hereby in accordance with the terms
hereof, and DUPONT shall have received a duly executed
certificate of the Secretary or an Assistant Secretary of the
Company setting forth a copy of such resolutions and such other
matters as may be requested by DUPONT.
(c) Shareholders' Agreement. The Company, DCEO, DUPONT,
and certain stockholders of the Company shall have executed and
delivered a Shareholders' Agreement in the form of Exhibit A
hereto.
(d) Standstill Agreement. The Company, DCEO, and DUPONT
shall have executed and delivered a Standstill Agreement in the
form of Exhibit B hereto.
(e) Registration Agreement. The Company and DCEO shall
have executed and delivered a Registration Agreement in the form
of Exhibit C hereto.
(f) All Proceedings Satisfactory. All corporate and other
proceedings taken prior to or at the Closing in connection with
the transactions contemplated by this Agreement, and all
documents and evidences incident thereto, shall be reasonably
satisfactory in form and substance to DUPONT, and DUPONT shall
receive such copies thereof. The issuance and sale of the Shares
to DCEO shall be made in conformity with all applicable state and
federal securities laws.
ARTICLE VI - COVENANTS OF THE COMPANY
The Company shall comply, and the Company shall cause any
direct or indirect subsidiaries of the Company to comply, with
the following covenants, except as shall otherwise be expressly
<PAGE>
agreed pursuant to a written consent executed by DUPONT. All
references to "the Company" in this Article VI shall be deemed to
refer to the Company and its direct and indirect subsidiaries, if
applicable, on a consolidated basis.
6.1 USE OF PROCEEDS
The proceeds received by the Company hereunder shall be
used by the Company to reduce existing operating lines of credit,
finance working capital and to redeem outstanding convertible
notes and debentures.
6.2 REGISTRATION RIGHTS
All Shares purchased by DCEO under this Agreement shall be
subject to registration rights in accordance with the
Registration Agreement set forth in Exhibit C.
6.3 EXCHANGE, TRANSFER AND REPLACEMENT OF SHARE CERTIFICATES
Upon surrender of any certificate representing Shares for
exchange or transfer at the offices of the Company, the Company
shall, at its expense (exclusive of applicable transfer taxes),
issue in exchange therefor new certificates in such denomination
or denominations as may be requested for the same aggregate
number of Common Shares represented by the certificate so
surrendered and registered as may be requested. Upon receipt of
evidence reasonably satisfactory to the Company of the loss,
theft, destruction or mutilation of any certificate representing
Common Shares and, in the case of any such loss, theft or
destruction, upon delivery of an agreement of indemnity, and if
required such other instruments or security bond, reasonably
satisfactory to the Company and its Transfer Agent, or, in the
case of any such mutilation, upon surrender and cancellation
thereof, the Company shall, at its expense, issue a new
certificate for the same aggregate number of Common Shares
represented by such lost, stolen, destroyed or mutilated
certificate, as the case may be.
ARTICLE VII - REPRESENTATIONS OF DUPONT AND DCEO
To induce the Company to execute this Agreement, DUPONT and
DCEO hereby jointly and severally represent and warrant to, and
covenants with, the Company with respect to DCEO's purchase of
Shares hereunder, that:
<PAGE>
7.1 AUTHORIZATION
The Agreements and all documents and instruments executed
pursuant hereto, are valid and binding obligations of each of
DUPONT and DCEO, enforceable in accordance with their terms,
subject to applicable bankruptcy, insolvency, reorganization,
moratorium and other laws applicable to creditors' rights and
remedies and to the exercise of judicial discretion in accordance
with general principles of equity. The execution, delivery and
performance of the Agreements have been duly authorized by all
necessary corporate action of each of DUPONT and DCEO.
7.2 EFFECT OF TRANSACTIONS
The execution, delivery and performance by each of DUPONT
and DCEO of this Agreement, the Shareholders' Agreement in the
form set forth in Exhibit A, the Standstill Agreement in the form
set forth in Exhibit B, and the Registration Agreement in the
form set forth in Exhibit C will not conflict with or result in
any default under any material contract, obligation or commitment
of either DUPONT or DCEO, or any charter provision, bylaw or
corporate restriction of either DUPONT or DCEO, or the creation
of any lien, charge or encumbrance of any material nature upon
any of the properties or assets of either DUPONT or DCEO. The
execution and delivery of this Agreement by each of DUPONT and
DCEO and their performance of the transactions contemplated
hereby will not violate any material instrument, agreement,
judgment, decree, order, statute, rule or regulation of any
Governmental Authority applicable to either DUPONT or DCEO.
7.3 SECURITIES ACT
(a) The Shares to be purchased by DCEO pursuant to this
Agreement are being acquired for investment purposes only and not
with a view to any public distribution thereof, and it will not
offer to sell or otherwise dispose of the Shares so acquired by
it in violation of any of the registration requirements of the
Securities Act of 1933, as amended. The certificates evidencing
the Shares will bear a legend reading substantially as follows:
THE SECURITIES REPRESENTED BY THIS
CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933 AND MAY NOT BE SOLD OR
TRANSFERRED EXCEPT IN COMPLIANCE WITH THAT ACT.
<PAGE>
THE SECURITIES REPRESENTED BY THIS CERTIFICATE
ARE SUBJECT TO THE PROVISIONS OF A PURCHASE
AGREEMENT DATED AS OF JANUARY 29, 1997, BETWEEN
HUDSON TECHNOLOGIES, INC. (THE "COMPANY") AND
CERTAIN SHAREHOLDERS OF THE COMPANY AND A
STANDSTILL AGREEMENT DATED AS OF JANUARY 29,
1997, AMONG THE COMPANY AND CERTAIN
SHAREHOLDERS OF THE COMPANY, COPIES OF WHICH
ARE ON FILE AT THE PRINCIPAL EXECUTIVE OFFICES
OF THE COMPANY.
(b) DUPONT and DCEO each have substantial experience in
business and financial matters and in making investments of the
type contemplated by this Agreement and is capable of evaluating
the merits and risks of its purchase of the Shares and is able to
bear the economic risks of its investment.
(c) DUPONT and DCEO each have had an opportunity to
discuss the Company's business, management and financial affairs,
and the terms and conditions of the Shares with the Company's
management and all such questions have been answered to the full
satisfaction of DUPONT and DCEO.
(d) DUPONT and DCEO each are an entity that qualifies as
an "accredited investor" within the meaning of Rule 5.01(a) of
Regulation D under the Securities Act.
7.4 NO REGISTRATION
(a) DUPONT and DCEO have been advised that the Securities
have not been and are not being registered under the Securities
Act or under the "blue sky" laws of any jurisdiction and that the
Company in issuing the Securities is relying upon, among other
things, the representations and warranties of DUPONT and DCEO
contained in this Article VII in concluding that each such
issuance is a "private offering" and does not require compliance
with the registration provisions of the Securities Act and
applicable state securities laws.
(b) Absent an effective registration statement under the
Securities Act covering the disposition of the Shares or unless
DCEO is entitled to have the restrictions imposed on the Shares
removed pursuant to Section 7.4(d) hereof, DCEO will not sell,
transfer, assign or otherwise dispose of any or all of the Shares
without first providing the Company with an opinion of counsel
<PAGE>
reasonably satisfactory in form and substance to counsel for the
Company to the effect that such sale, transfer, assignment or
other disposition will be exempt from the registration
requirements of the Securities Act.
(c) DCEO consents to the Company's making a notation on
its records or giving instructions to any transfer agent of the
Shares in order to implement the restrictions on transfer of the
Shares mentioned in this Section 7.4.
(d) Any legend endorsed on a certificate evidencing the
Shares pursuant to Section 7.3 and 7.4 hereof and the stop
transfer instructions and record notations with respect to such
Shares shall be removed and the Company shall issue a certificate
without such legend to the holder of such Shares if (i) such
Shares are registered under the Securities Act, (ii) such Shares
are sold under Rule 144(k) of the Commission under the Securities
Act or (iii) such holder provides the Company with an opinion of
counsel reasonably satisfactory in form and substance to counsel
for the Company to the effect that a public sale or transfer of
such Shares was made without registration under the Securities
Act.
7.5 SECURITIES
For purposes of this Article, the term "Securities"
includes all securities issued hereunder or on account of
ownership of or conversion of the Shares whether in connection
with any stock dividend, stock split, recapitalization, merger,
consolidation or otherwise.
ARTICLE VIII - GENERAL
8.1 AMENDMENTS, WAIVERS AND CONSENTS
For the purposes of this Agreement and all agreements,
documents and instruments executed pursuant hereto, except as
otherwise specifically set forth herein or therein, no course of
dealing between the Company and DUPONT or DCEO and no delay on
the part of any party hereto in exercising any rights hereunder
or thereunder shall operate as a waiver of the rights hereof and
thereof. No covenant or other provision hereof or thereof may be
waived otherwise than by a written instrument signed by the party
so waiving such covenant or other provision; provided, however,
that except as otherwise provided herein or therein, changes in
<PAGE>
or additions to, and any consents required by this Agreement may
be made, and compliance with any term, covenant, condition or
provision set forth herein may be omitted or waived (either
generally or in a particular instance and either retroactively or
prospectively) by a consent or consents in writing of DUPONT.
Any amendment or waiver effected in accordance with this
paragraph shall be binding upon DUPONT and DCEO and the Company.
8.2 SURVIVAL OF COVENANTS; ASSIGNABILITY OF RIGHTS
(a) All covenants, agreements, representations and
warranties of the Company made herein and in the certificates,
lists, exhibits, schedules or other written information delivered
or furnished to DUPONT and DCEO in connection herewith shall be
deemed material and to have been relied upon by DUPONT and DCEO,
and, except as provided otherwise in this Agreement, shall
survive the delivery of the Shares for a period of nine months,
and shall bind the Company's successors and assigns, whether so
expressed or not, and, except as provided otherwise in this
Agreement, all such covenants, agreements, representations and
warranties shall inure to the benefit of DCEO's successors and
assigns and to transferees of the Securities, whether so
expressed or not.
(b) This Agreement and the rights hereunder shall not be
assignable or transferable by DUPONT or DCEO or the Company
(except by operation of law in connection with a merger,
consolidation or other reorganization or sale of all or
substantially all the assets of DUPONT, DCEO or the Company)
without the prior written consent of the other party hereto;
provided that DUPONT or DCEO may assign, in its sole discretion,
any or all of its rights, interests and obligations under this
Agreement to any of DUPONT's more than 50% owned subsidiaries
("Affiliates") or to any transferee of the Shares. Subject to
the preceding sentence, this Agreement shall be binding upon,
inure to the benefit of and be enforceable by the parties hereto
and their respective successors and assigns. The assignment by
DUPONT or DCEO of any rights, interest or obligations under this
Agreement to any transferee of the Shares acquired hereunder
shall not affect or diminish the rights or obligations of DUPONT
or DCEO under this Agreement.
<PAGE>
8.3 GOVERNING LAW
The enforcement of this Agreement shall be governed by, and
in connection with such enforcement this Agreement shall be
construed in accordance with, the laws of the State of Delaware.
8.4 SECTION HEADINGS
The descriptive headings in this Agreement have been
inserted for convenience only and shall not be deemed to limit or
otherwise affect the construction of any provision thereof or
hereof.
8.5 PUBLICITY
The Company and DUPONT agree that (a) no public release or
announcement concerning the transactions contemplated hereby
shall be issued by any party hereto without the prior consent of
the other party, except as such release or announcement may be
required by law or the rules or regulations of any securities
exchange, in which case the party required to make the release or
announcement shall allow the other party reasonable time to
comment on such release or announcement in advance of such
issuance and (b) without the prior consent of DUPONT, the Company
shall not issue any public release or announcement or issue or
distribute any document to be used in connection with the private
or public sale of debt or equity securities of the Company if
such release, announcement or document refers to DCEO's
investment in or contracts or other arrangements with the
Company, except as may be required by law or the rules or
regulations of any securities exchange or by any Governmental
Authority, in which case the Company shall allow DUPONT
reasonable time to comment on the relevant portions of such
release, announcement or document.
8.6 COUNTERPARTS
This Agreement may be executed simultaneously in any number
of counterparts, each of which when so executed and delivered
shall be taken to be an original; but such counterparts shall
together constitute but one and the same document.
8.7 NOTICES
All notices, requests, demands and other communications
hereunder shall be in writing and shall be deemed given if
delivered personally or mailed by certified or registered mail,
<PAGE>
postage prepaid, return receipt requested, or delivered to a
nationally recognized next business day courier for delivery on
the next business day, or by facsimile, with a copy sent as
aforesaid and in any instance addressed as follows:
(i) if to DUPONT
E. I. Du Pont de Nemours and Company
1007 Market Street
Wilmington, DE 19898
Attention: Vice President and Treasurer
(ii) if to the Company
Hudson Technologies, Inc.
25 Torne Valley Road
Hillburn, NY 10931-9900
Attention: President
(iii) if to DCEO
DuPont Building, Room 8045
1007 Market Street
Wilmington, DE 19898
Attention: Administrator -
Du Pont Chemical and Energy
Operations, Inc.
or such other address as shall be furnished in writing by any of
the parties, and any such notice or communication shall be deemed
to have been given as of the date so delivered personally, so
mailed, so delivered to the courier service, or so transmitted by
telecopy (except that a notice of change of address shall not be
deemed to have been given until received by the addressee).
8.8 SEVERABILITY
Whenever possible, each provision of this Agreement shall
be interpreted in such a manner as to be effective and valid
under applicable law, but if any provision of this Agreement
shall be deemed prohibited or invalid under such applicable law,
such provision shall be ineffective to the extent of such
<PAGE>
prohibition or invalidity, and such prohibition or invalidity
shall not invalidate the remainder of such provision or the other
provisions or this Agreement.
8.9 EXPENSES
The Company shall pay all costs and expenses that it incurs
with respect to the negotiation, execution, delivery and
performance of this Agreement, and DUPONT and DCEO shall pay all
costs and expenses that they incur with respect to the
negotiation, execution, delivery and performance of this
Agreement.
8.10 ENTIRE AGREEMENT
This Agreement and the agreements referred to herein
contain the entire agreement and understanding between the
parties hereto with respect to the subject matter hereof and
supersede all prior agreements and understandings relating to
such subject matter
8.11 SPECIFIC ENFORCEMENT; INJUNCTIVE RELIEF
The parties acknowledge that damages would be an inadequate
remedy for any breach of the provisions of this Agreement.
Therefore, the obligations of the parties hereunder shall be
specifically enforceable and each of the parties agrees that each
of them shall be entitled to an injunction, restraining order or
other equitable relief from any court of competent jurisdiction,
restraining any party from committing any violations of the
provisions of this Agreement.
IN WITNESS WHEREOF, the undersigned have executed this
Agreement as a sealed instrument as of the day and year first
above written.
HUDSON TECHNOLOGIES, INC.
By /s/ Kevin J. Zugibe
Title President
Date January 29, 1997
<PAGE>
E. I. DUPONT DE NEMOURS AND COMPANY
By /s/ Mark E. Stookey
Title Attorney-in-Fact
Date January 29, 1997
DU PONT CHEMICAL AND ENERGY OPERATIONS, INC.
By /s/ Mark D. Matthews
Title Attorney-in-Fact
Date January 29, 1997
<PAGE>
Exhibit C
SHAREHOLDERS' AGREEMENT
------------------------
This Shareholders' Agreement (the "Agreement") is made and
entered into as of January 29, 1997, among HUDSON TECHNOLOGIES,
INC. ("HTI"), E. I. DU PONT DE NEMOURS AND COMPANY ("DUPONT"),
DU PONT CHEMICAL AND ENERGY OPERATIONS, INC. ("DCEO") and the
persons named in Attachment A to this Shareholders' Agreement who
have Beneficial Ownership of approximately twenty percent (20%)
of the issued and outstanding Common Stock, par value $0.01 per
share ("Common Stock") of HTI (hereafter the individuals named in
Attachment A are referred to collectively as the Stockholders
Group).
W I T N E S S E T H :
HTI, DCEO and DUPONT are simultaneously herewith entering
into a Stock Purchase Agreement, a Standstill Agreement, and a
Registration Agreement, all of which are dated as of January 29,
1997.
Each member of the Stockholders Group is willing to execute
this Shareholders' Agreement and to be bound by its provisions
with respect to future sales of their shares of Common Stock and
to voting for DUPONT's nominee for election to the Board of
Directors of HTI. It is a condition precedent to DUPONT entering
into the Stock Purchase Agreement, the Standstill Agreement, and
the Registration Agreement that this Shareholders' Agreement be
signed by the parties hereto. Each of the parties considers the
provisions contained herein to be in the best interest of HTI.
NOW, THEREFORE, in consideration of the respective
agreements herein contained, the parties hereto agree as follows:
1. DEFINITIONS
For purposes of this Shareholders' Agreement:
(a) The term "Voting Securities" shall mean all classes of
capital stock of HTI which are then entitled to vote generally in
the election of directors or securities which do not carry the
right to vote generally in the election of directors (including
<PAGE>
convertible debt securities) but which may be exchanged,
converted or exercised into a class of capital stock with such
voting rights, and shall include Voting Securities owned
contemporaneously with the date first above written or purchased
subsequent to such date pursuant to stock options held on such
date.
(b) The term "Beneficial Ownership" shall have the meaning
set forth in Rule 13d-3(a) under the Securities Exchange Act of
1934, as amended (the "1934 Act").
(c) The term "Control Disposition" shall mean a
Disposition or a series of related Dispositions that would have
the effect of transferring to any transferee or group (as defined
for purposes of Section 13(d)(3) of the Securities Exchange Act
of 1934, as amended, and the rules and regulations thereunder
(the "Exchange Act")) of persons (a "Group") beneficial ownership
(as defined in Rule 13d-3 of the Exchange Act ) of a number of
shares of outstanding Voting Securities that, in the aggregate,
exceeds (1) 5% of the outstanding shares of Voting Securities if,
after giving effect to such proposed transfer, the proposed
transferee or Group will have beneficial ownership, directly or
indirectly, of 10% or more of the then outstanding shares of
Voting Securities or (2) 10% of the then outstanding shares of
Voting Securities. "Control Disposition" shall not include the
transfer of Voting Securities from one member of the Stockholder
Group to another member of the Stockholder Group.
(d) The term "Disposition" shall mean any direct or
indirect transfer, assignment, sale, gift, pledge, hypothecation,
encumbrance or other disposition of Voting Securities (or any
interest therein) or of all or part of the voting power (other
than the granting of a revocable proxy) associated with the stock
(or any interest therein) whatsoever, or any other transfer of
beneficial ownership of Voting Securities, whether voluntary or
involuntary, including, without limitation, any such disposition
or transfer as a part of any liquidation of the holder's assets
or any reorganization of a holder pursuant to the United States
or any other bankruptcy law or other similar debtor relief laws.
Each capitalized term not here defined shall have the
meaning assigned to it by the provisions in which it is first
used, or if not defined in this Agreement, the meaning assigned
to it by the Stock Purchase Agreement.
<PAGE>
2. TERM
(a) The effective date of this Shareholders' Agreement
shall commence as of January 29, 1997, and shall terminate on
January 29, 2002. Notwithstanding the foregoing, this
Shareholders' Agreement shall not become effective unless and
until the Stock Purchase Agreement, the Standstill Agreement and
the Registration Agreement have been signed by HTI, DUPONT and
DCEO, and received by the other party.
(b) If prior to January 29, 2002, DUPONT and DCEO
beneficially own a number of Voting Securities that represent
less than 50% of the DuPont Voting Power (as defined in the
Standstill Agreement) that DUPONT and DCEO held immediately after
the Closing then this Shareholders' Agreement shall terminate at
such time upon written notice by any of the parties hereto.
3. ONE-YEAR PROHIBITION
Except for Voting Securities offered for sale or transfer
in accordance with the provisions of paragraph 4(f) hereof, no
party to this Agreement shall, without the prior written consent
of all other parties to this Agreement, sell, agree to sell,
transfer or otherwise dispose of any Voting Securities until
January 29, 1998; provided, that, the prohibitions of this
Section 3 shall not apply to the sale and transfer of Voting
Securities by such shareholder to an Affiliate of such
shareholder if (in the case of an Affiliate that is not a party
hereto) such Affiliate has furnished to the other parties hereto
an undertaking, the performance of which is guaranteed by such
shareholder, in form reasonably satisfactory to the other parties
hereto, to be bound by the provisions of this Agreement. Any
purported disposition made in violation of this Section 3 shall
be void.
4. RIGHT OF FIRST REFUSAL
Except for Voting Securities offered for sale or transfer
in accordance with the provisions of paragraph 4(f) hereof, no
member of the Stockholders Group and no agent or representative
of any member of the Stockholders Group shall, directly or
indirectly, offer, sell or transfer any Voting Securities without
offering DUPONT the right of first refusal set forth in this
Section 4 in the following manner:
<PAGE>
(a) Any member of the Stockholders Group intending to make
such an offer, sale or transfer shall give notice (the "Transfer
Notice") to DUPONT in writing of such intention, specifying the
number of Voting Securities proposed to be disposed of and the
proposed price therefor, and the specific offer to purchase such
Voting Securities theretofore received and then remaining open,
identifying the offeror and setting forth all the terms of such
offer (including price). For purposes hereof, a bona fide
third-party tender or exchange offer pursuant of Regulation 14D
of the 1934 Act to purchase Voting Securities shall be deemed to
be an offer at the price specified therein, without regard to any
provisions thereof with respect to proration or conditions to the
offeror's obligation to purchase. In the event the Transfer
Notice specifies Voting Securities are intended to be sold into
the public trading market, the "proposed price" per share for
such sale shall be the average of the high and low price for one
share of HTI Common Stock as reported on the National Association
of Securities Dealers Automated Quotations System ("NASDAQ") on
the last trading date immediately prior to the date that DUPONT
provides such member of the Stockholders Group written notice of
DUPONT's intent to exercise its right of first refusal with
regard to such Voting Securities (the "Market Price"); provided,
however, such member of the Stockholder Group shall have the
right to withdraw such Transfer Notice, by written notice to
DUPONT within two (2) business days following DUPONT's notice, if
such Market Price is below the minimum acceptable Market Price
(the "Floor Price") provided in the Transfer Notice; provided
that, such Floor Price shall not be greater than the closing
price as quoted on NASDAQ on the last trading day immediately
prior to the date of the Transfer Notice; provided further, that
any such Transfer Notice that does not specify a Floor Price
shall be ineffective.
(b) DUPONT shall have the right, exercisable by written
notice given by DUPONT to the member of the Stockholders Group
who gave the Transfer Notice within thirty (30) days after
receipt of such Transfer Notice (the "Regular Notice Period") (or
in the case of a cash tender or exchange offer pursuant to
Regulation 14D of the 1934 Act, no later than 24 hours prior to
the latest time by which Voting Securities must be tendered in
order to be accepted pursuant to such offer or to qualify for any
proration applicable to such offer; provided that the Transfer
Notice is received by DUPONT no later than five (5) business days
after the tender offer materials have been received by the member
of the Stockholders Group who gave such Transfer Notice) to
<PAGE>
exercise its right of first refusal to purchase (or to cause a
corporation, entity, person or group designated by DUPONT to
purchase) all, but not a part of, the Voting Securities specified
in such Transfer Notice for cash at the price set forth therein;
provided however, that such Regular Notice Period shall be
reduced from thirty (30) days to fifteen (15) days (the
"Accelerated Notice Period") for any Transfer Notice proposing to
sell Voting Securities for a total purchase price in cash of less
than $500,000 (which shall be determined, in the event the
Transfer Notice specifies Voting Securities are intended to be
sold into the public trading market, by multiplying the number of
Voting Securities proposed to be sold times the Floor Price
designated in the Transfer Notice); provided further, that there
shall be no more than (1) one Accelerated Notice Period for any
member of the Stockholder Group in any 12 month period.
(c) Except as set forth in Section 4(b) above, the
following procedures shall be followed with respect to a Transfer
Notice which includes any property other than cash:
(i) If the purchase price specified in the Transfer
Notice includes any property other than cash, such purchase price
shall be deemed to be the amount of any cash included in the
purchase price plus the value (as jointly determined by DUPONT
and the member of the Stockholders Group who gave such Transfer
Notice or, in the event DUPONT and the member of the Stockholders
Group who gave such Transfer Notice are unable to agree, by a
nationally or regionally recognized investment banking or
consulting firm (the "Property Valuation Firm"), which firm shall
be selected by two other previously chosen nationally or
regionally recognized investment banking or consulting firms,
each of which was chosen by DUPONT and the member of the
Stockholders Group who gave such Transfer Notice, respectively,
of such other property included in such price. DUPONT and the
member of the Stockholders Group who gave the Transfer Notice
shall share equally the expenses incurred by the Property
Valuation Firm.
(ii) DUPONT and the member of the Stockholders
Group who gave such Transfer Notice shall use their best efforts
to cause any determination of the value of any securities
included in the purchase price to be made within three (3)
business days after the date of delivery of the Transfer Notice.
If DUPONT and the member of the Stockholders Group who gave such
Transfer Notice are unable to agree upon the value of any such
<PAGE>
securities within such three-day period, DUPONT and the member of
the Stockholders Group who gave such Transfer Notice shall
promptly (but in no event later than five (5) business days after
the date of delivery of the Transfer Notice) cause the selection
of the Property Valuation Firm whose determination, which shall
be made within three (3) business days of its selection, shall be
conclusive.
(iii) DUPONT and the member of the Stockholders Group
who gave such Transfer Notice shall use their best efforts to
cause any determination of the value of property other than
securities to be made within five (5) business days after the
date of delivery of the Transfer Notice. If DUPONT and the
member of the Stockholders Group who gave such Transfer Notice
are unable to agree upon a value within such five-day Period,
DUPONT and the member of the Stockholders Group who gave such
Transfer Notice shall promptly (but in no event later than seven
(7) business days after the date of delivery of the Transfer
Notice) cause the selection of the Property Valuation Firm whose
determination, which shall be made within five (5) business days
of its selection, shall be conclusive.
(iv) If the above process to determine the value of
the other non-cash property is not completed within fifteen
calendar days of the date of the Transfer Notice, then DUPONT's
exercise of its right of first refusal shall be extended until
fifteen (15) calendar days after the value of such other non-cash
property is determined as provided for in paragraphs 4(c)(ii) and
4(c)(iii) above.
(d) If DUPONT exercises its right of first refusal
hereunder, the closing of the purchase of the Voting Securities
with respect to which such right has been exercised shall take
place within thirty (30) calendar days after DUPONT gives notice
of such exercise, or within twenty (20) calendar days after
DUPONT has obtained any necessary government approval or
nonobjection, if any, whichever is later. DUPONT shall make
application for any necessary government approval as soon as
practicable after exercising its right of first refusal. Upon
exercise of its right of first refusal, DUPONT shall not be
legally obligated to consummate the purchase contemplated
thereby, unless and until any such necessary government approvals
are received.
<PAGE>
(e) If DUPONT does not exercise its right of first refusal
hereunder within the time specified for such exercise, the party
giving the Transfer Notice shall be free during the period of
ninety (90) calendar days following the expiration of such time
for exercise to sell the Voting Securities specified in such
Transfer Notice to the offeror identified therein at the price
specified therein or at any price in excess thereof. With regard
to any Transfer Notice specifying the sale of Voting Securities
into the public trading market, such party shall be free during
such 90-day period to sell the Voting Securities specified in
such Transfer Notice into such public trading market at any price
greater than or equal to the Floor Price specified in the
Transfer Notice. If such party shall not have completed such
transfer within such 90-day period, the restrictions on transfer
imposed by this Section 4 shall again apply to any proposed
transfer of such Voting Securities.
(f) No member of the Stockholders Group shall, directly or
indirectly, offer, sell or transfer any Voting Securities without
offering DUPONT a right of first refusal in the manner provided
in Section 4 except (i) to another member of the Stockholders
Group, (ii) in a bona fide public offering registered under the
Act (provided that no sales of Voting Securities are made to any
person or related group of persons who would immediately
thereafter, to the knowledge of any member of the Stockholders
Group, have Beneficial Ownership of, or have the right to acquire
Beneficial Ownership of, Voting Securities representing more than
five percent (5%) of the total combined voting power of all
Voting Securities then outstanding), (iii) pursuant to Rule 144
under the Act (provided that no sales of Voting Securities are
made to any person or related group of persons who would
immediately thereafter, to the knowledge of the selling member of
the Stockholders Group, have Beneficial Ownership of, or have the
right to acquire Beneficial Ownership of, Voting Securities
representing more than five percent (5%) of the total combined
voting power of all Voting Securities then outstanding), (iv) to
a trust for the benefit of members of the Stockholders Group,
their spouses and relatives (whether born or unborn), provided
the trust becomes a party to this Shareholders' Agreement, or (v)
to any beneficiary of the estate of any member of the
Stockholder's Group provided that prior to receiving Beneficial
Ownership of said Voting Securities the beneficiary becomes a
party to this Shareholders' Agreement; provided, however, that
with regard to clauses (ii) and (iii) any such sales by a member
of the Stockholders Group shall not exceed: (a) 25,000 shares of
<PAGE>
Voting Securities in the initial 12 month period of the term of
this Agreement, (b) 50,000 shares of Voting Securities in the
initial 24 month period of the term of this Agreement, (c) 75,000
shares of Voting Securities in the initial 36 month period of the
term of this Agreement or (d) 100,000 shares of Voting Securities
during the term of this Agreement.
For purposes of (ii) and (iii) above, the seller or donor,
as the case may be, his counsel and HTI's transfer agent shall be
entitled to rely on a written representation from the person
purchasing or receiving the Voting Securities to the effect that
neither such person, nor any related group of persons,
immediately after receipt thereof, will have Beneficial Ownership
of or the right to acquire Beneficial Ownership of Voting
Securities representing more than five percent (5%) of the total
combined voting power of all Voting Securities then outstanding.
For purposes of this Shareholders' Agreement, the term
"related group of persons" means persons acting in concert with
each other as to HTI and its Voting Securities.
5. CONTROL DISPOSITION
Notwithstanding anything herein to the contrary, no member
of the Stockholder Group shall make or participate in any Control
Disposition without first complying with Sections 3 and 4. Any
member of the Stockholder Group desiring to make or participate
in a Control Disposition ("Control Offeror"), after complying
with Sections 3 and 4, shall give a written notice ("Control
Disposition Offer") to all other holders of outstanding Common
Stock who are parties to this Agreement ("Control Offerees") (1)
describing the proposed Control Disposition and the proposed
transferee in reasonable detail and setting forth the number of
shares to Stock as to which the Control Offeror desires to make a
Control Disposition and (2) providing each Control Offeree with
the right to elect (by written notice to the Company within ten
(10) days after the receipt of the Control Disposition Offer) to
dispose of in the Control Disposition, at the same price and on
the same terms that the beneficial ownership of the Control
Offeror's Stock is to be transferred in the Control Disposition,
any number of shares of the common stock of the Company held by
such Control Offeree as determined in the sole discretion of the
Control Offeree.
<PAGE>
6. ELECTION OF DCEO NOMINEE(S)
During the period that DCEO exercises its right to
designate a person(s) for nomination to the HTI Board of
Directors pursuant to Section 4 of the Standstill Agreement, each
member of the Stockholders Group, individually, shall vote all
the Voting Securities over which he has direct or indirect voting
control for such nominee(s).
7. MISCELLANEOUS
(a) DUPONT and the members of the Stockholders Group
acknowledge and agree that irreparable damage would occur to
DUPONT and to the members of the Stockholders Group in the event
any of the provisions of this Shareholders' Agreement were not
performed in accordance with their specific terms or were
otherwise breached. It is accordingly agreed that DUPONT and the
members of the Stockholders Group shall be entitled to an
injunction or injunctions to prevent breaches of the provisions
of this Shareholders' Agreement and to enforce specifically the
terms and provisions hereof in any court of the United States or
any state thereof having jurisdiction, in addition to any other
remedy to which they may be entitled at law or in equity.
(b) The members of the Stockholders' Group agree that HTI
may enter a stop transfer order with the transfer agent or agents
of Voting Securities prohibiting the transfer of Voting
Securities other than in compliance with the requirements of this
Shareholders' Agreement.
(c) Each member of the Stockholders' Group and HTI agree
to take or cause to be taken such action as may be required to
accomplish the intent of this Shareholders' Agreement and further
agrees to provide DUPONT with such additional certificates,
opinions, instruments or documents as DUPONT may reasonably
request to accomplish the intent of the transactions contemplated
by this Shareholders' Agreement.
(d) This Shareholders' Agreement shall be binding on the
successors, assigns, donees, heirs, distributees, beneficiaries,
devisees and legatees of each member of the Stockholders Group,
except for permitted sales, transfers and assignments under
Section 4 hereof.
<PAGE>
(e) This Shareholders' Agreement and the attachments
hereto contain the entire understanding of the parties with
respect to the transactions contemplated herein, and this
Shareholders' Agreement may be amended only by an agreement in
writing executed by the parties hereto.
(f) All notices, requests, demands and other
communications hereunder shall be in writing and shall be deemed
given if delivered personally or mailed by certified or
registered mail, postage prepaid, return receipt requested, or
delivered to a nationally recognized next business day courier
for delivery on the next business day, or by facsimile, with a
copy sent as aforesaid and in any instance addressed as follows:
If to Company:
Hudson Technologies, Inc.
25 Torne Valley Road
Hillburn, New York 10931-9900
If to DUPONT:
E. I. du Pont de Nemours and Company
1007 Market Street
Wilmington, Delaware 19898
Attention: Vice President and Treasurer
If to DCEO:
Du Pont Chemical and Energy Operations, Inc.
DuPont Building, Room 8045
1007 Market Street
Wilmington, Delaware 19898
Attention: Administrator
If to any member of the Stockholder's Group:
or such other address as shall be furnished in writing by any of
the parties, and any such notice or communication shall be deemed
to have been given as of the date so delivered personally, so
mailed, so delivered to the courier service, or so transmitted by
telecopy (except that a notice of change of address shall not be
deemed to have been given until received by the addressee).
<PAGE>
(g) This Agreement shall be governed by and construed and
enforced in accordance with the laws of the State of Delaware
applicable to contracts made and to be performed therein.
IN WITNESS WHEREOF, DUPONT, DCEO, HTI and the members of
the Stockholders Group have caused this Agreement to be duly
executed all as of the day and year first above written.
E. I. DUPONT DE NEMOURS AND COMPANY
By /s/ Mark E. Stookey
Name: Mark E. Stookey
Title: Attorney-in-Fact
DU PONT CHEMICAL AND ENERGY OPERATIONS, INC.
By /s/ Mark D. Matthews
Name: Mark D. Matthews
Title: Attorney-in-Fact
HUDSON TECHNOLOGIES, INC.
By /s/ Kevin J. Zugibe
Name: Kevin J. Zugibe
Title: President
THE STOCKHOLDER[S]
/s/ Frederick J. Zugibe /s/ Stephen Mandracchia
/s/ Kevin J. Zugibe /s/ Stephen Cole-Hatchard
/s/ Thomas P. Zugibe
<PAGE>
Attachment A
HTI STOCKHOLDERS GROUP
HTI Shares HTI Options
---------- -----------
Kevin J. Zugibe 234,000 115,000
Stephen J. Cole-Hatchard 233,000 100,000
Stephen P. Mandracchia 122,000 100,000
Thomas P. Zugibe 234,000 100,000
Frederick T. Zugibe 212,500 75,000
------- -------
Total 1,035,500 490,000
========= =======
<PAGE>
Exhibit D
STANDSTILL AGREEMENT
AGREEMENT dated as of January 29, 1997 between E. I. DU
PONT DE NEMOURS AND COMPANY, a Delaware corporation ("DuPont"),
DU PONT CHEMICAL AND ENERGY OPERATIONS, INC., a Delaware
corporation ("DCEO") and HUDSON TECHNOLOGIES, INC., a New York
Corporation (the "Company").
DCEO has acquired pursuant to a Stock Purchase Agreement
with the Company dated January 29, 1997 (the "Stock Purchase
Agreement") and currently owns an aggregate of 500,000 shares of
the Common stock, par value $0.01 per share (such class of common
stock being referred to herein as "Common Stock"), of the
Company. In order to establish a constructive and mutually
beneficial relationship between DuPont, DCEO and the Company, the
parties agree as follows:
1. TERM OF AGREEMENT
(a) Except as otherwise expressly provided herein, the
respective covenants and agreements of the parties contained in
this Agreement will continue in full force and effect until
January 29, 2002 (such date being referred to herein as the
"Termination Date").
(b) If notice of termination is delivered by DuPont or
DCEO or the Company as provided in paragraph 7(a), this Agreement
shall terminate in its entirety on the date which is sixty days
following such notice (such date being referred to herein as the
"Termination Date"), but shall continue in full force and effect
until the Termination Date except as otherwise provided herein.
(c) If this Agreement is terminated as provided in this
paragraph, unless the Company otherwise agrees, DuPont and DCEO
will cause all designees of DuPont or DCEO serving on the
Company's Board of Directors pursuant to paragraph 4 to resign
from such Board of Directors, effective as of the Termination
Date.
<PAGE>
2. COVENANTS OF DUPONT
Prior to the Termination Date or earlier termination of
this Agreement in accordance with its terms and subject to the
further provisions hereof:
(a) Neither DuPont nor any corporation or other entity
controlled by DuPont (collectively, the "DuPont Group") will,
directly or indirectly, acquire any shares of any class of
capital stock of the Company which is then entitled to vote
generally in the election of directors (all such classes of
capital stock of the Company being referred to herein as "Voting
Securities") (except by way of stock dividends or other
distributions or offerings made available to holders of Voting
Securities generally) if the effect of such acquisition would be
to increase the aggregate voting power in the election of
directors of all Voting Securities then owned by all members of
the DuPont Group (such aggregate voting power of all Voting
Securities owned by all members of the DuPont Group being
referred to herein as the "DuPont Voting Power") to greater than
20% of the total combined voting power in the election of
directors of all the Voting Securities then outstanding (such
total combined voting power of all the Voting Securities
outstanding being referred to herein as the "Total Voting
Power"); provided that the DuPont Group may acquire Voting
Securities without regard to the foregoing limitation if any of
the following events (hereinafter referred to as "Triggering
Events") shall occur: (i) a tender or exchange offer is made by
any person or 13D Group (as hereinafter defined) (other than an
affiliate of, or any person acting in concert with, any member of
the DuPont Group and other than a tender or exchange offer that
is induced by any member of the DuPont Group) to acquire Voting
Securities which, if added to the Voting Securities (if any)
already owned by such person or 13D Group, would represent more
than 20% of the Total Voting Power at such time, (ii) it is
publicly disclosed or DuPont otherwise learns that Voting
Securities representing more than 20% of the Total Voting Power
have been acquired subsequent to January 1, 1997, or are proposed
(in a public announcement or filing) to be acquired subsequent to
such date by any person or 13D Group (other than an affiliate of,
or any person acting in concert with, any member of the DuPont
Group and other than any such acquisition or proposed acquisition
of Voting Securities that has been induced, in whole or in part,
by any member of the DuPont Group), or (iii) any person (not
including any member of the Stockholders Group, as defined in the
Stockholders Agreement as defined below) or 13D Group (not
including affiliates or members of the DuPont Group and not
<PAGE>
including any 13D Group comprised solely of the members of the
Stockholders Group, as defined in the Shareholders Agreement as
defined below) shall beneficially own Voting Securities
representing a percentage of the Total Voting Power which exceeds
the greater of (x) 10% or (y) the percentage of the Total Voting
Power represented by the DuPont Voting Power at such time, and
would be required (under rules and regulations in effect on
January 29, 1997) to file a statement on Schedule 13D with the
Securities and Exchange Commission reporting beneficial ownership
of such Voting Securities, other than any such beneficial
ownership that has been induced, in whole or in part, by any
member of the DuPont Group or (iv) pursuant to its rights to
purchase Voting Securities under the Shareholders Agreement
between DCEO, DuPont, the Company and certain principal
shareholders of the Company dated January 29, 1997 (the
"Shareholders Agreement"). As used herein, the term "13D Group"
shall mean any group of persons formed for the purpose of
acquiring, holding, voting or disposing of Voting Securities
which would be required under Section 13(d) of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and the
rules and regulations thereunder (as in effect, and based on
legal interpretations thereof existing, on January 29, 1997) to
file a statement on Schedule 13D with the Securities and Exchange
Commission as a "person" within the meaning of Section 13(d)(3)
of the Exchange Act if such group beneficially owned Voting
Securities representing more than 5% of any class of Voting
Securities then outstanding.
(b) If at any time the DuPont Voting Power shall be
increased to more than 20% of the Total Voting Power as a result
of a repurchase of Voting Securities by the Company or any other
change in the Company's capitalization, no member of the DuPont
Group shall be required to dispose of any Voting Securities.
(c) As used herein, the term "Significant Event" means any
charter or bylaw amendment, acquisition or disposition of assets
(by way of merger, consolidation or otherwise), change in
capitalization, liquidation, or other action out of the ordinary
course of business of the Company.
(d) The members of the DuPont Group, as holders of Voting
Securities, shall be present, in person or by proxy, at all
meetings of shareholders of the Company so that all Voting
Securities beneficially owned by them may be counted for the
purpose of determining the presence of a quorum at such meetings.
<PAGE>
(e) No member of the DuPont Group shall solicit proxies or
become a "participant" in a "solicitation" (as such terms are
defined in Regulation 14A under the Exchange Act, as in effect on
January 29, 1997) in opposition to the recommendation of the
majority of the directors of the Company with respect to any
matter; provided that the limitation contained in this paragraph
(e) shall not apply to any Significant Event to be voted on by
the Company's shareholders that is not initiated or proposed by
any member of the DuPont Group.
(f) No member of the DuPont Group shall join a
partnership, limited partnership, syndicate or other group, or
otherwise act in concert with any other person, for the purpose
of acquiring, holding, voting or disposing of Voting Securities,
or otherwise become a "person" within the meaning of Section
13(d)(3) of the Exchange Act (in each case other than solely with
members of the DuPont Group), except as to voting on specific
matters as to which the DuPont Group is permitted to solicit
proxies pursuant to the proviso of paragraph 2(e).
(g) No member of the DuPont Group shall, directly or
indirectly, offer, sell or transfer any Voting Securities without
offering the Company a right of first refusal in the manner
provided in paragraph 5, except (i) to another member of the
DuPont Group, (ii) pursuant to a bona fide public offering,
registered under the Securities Act of 1933, as amended (the
"Act"), of Voting Securities (provided that no sales of Voting
Securities or securities exchangeable for Voting Securities are
made to any person or related group of persons who would
immediately thereafter, to the knowledge of any member of the
DuPont Group, own or have the right to acquire Voting Securities
representing more than 5% of the Total Voting Power) or (iii)
pursuant to Rule 144 under the Act (provided that no sales of
Voting Securities are made to any person or related group of
persons who would immediately thereafter, to the knowledge of any
member of the DuPont Group, own or have the right to acquire
Voting Securities representing more than 5% of the Total Voting
Power).
For purposes of (ii) and (iii) above, DuPont, DuPont's
counsel and HTI's transfer agent shall be entitled to rely on a
written representation from the person purchasing or receiving
the Voting Securities to the effect that neither such person, nor
any related group of persons, immediately after receipt thereof,
<PAGE>
will have Beneficial Ownership of or the right to acquire
Beneficial Ownership of Voting Securities representing more than
five percent (5%) of the total combined voting power of all
Voting Securities then outstanding.
For purposes of this Standstill Agreement, the term
"related group of persons" means persons acting in concert with
each other as to HTI and its Voting Securities.
3. COVENANTS OF THE COMPANY
(a) Prior to the Termination Date or earlier termination
of this Agreement in accordance with its terms and subject to the
further provisions hereof without DuPont's written consent, the
Company will not take or recommend to its shareholders any action
during the term of this Agreement which would (1) impose
limitations on the legal rights of the DuPont Group as Company
shareholders other than those imposed pursuant to the express
terms of this Agreement, including, without limitation, any
action which would impose restrictions (i) based upon the size of
security holding, nationality of a security holder, the business
in which a security holder is engaged or other considerations
applicable to the DuPont Group and not to security holders
generally, or (ii) with reference to Common Stock generally, by
means of the issuance of or proposal to issue any other class of
securities having voting power disproportionately greater than
the equity investment in the Company represented by such
securities; (2) involve the issuance or corporate action
providing for the issuance of any warrant, capital stock or other
security or any other rights of which (including rights of
redemption) are dependent upon the amount of Voting Securities
owned by the DuPont Group; (3) deny any benefit to the members of
the DuPont Group proportionately as holders of any class of
Voting Securities that is made available to other holders of the
same class of Voting Securities generally; or (4) alter voting or
other rights of the holders of any class of Voting Securities so
that any such rights (or the vote required with respect to any
matter) are determined with reference to the amount of Voting
Securities held by the DuPont Group; provided that the Company
will cease to be subject to this paragraph 3(a) if a Triggering
Event has occurred (other than pursuant to the rights of the
DuPont Group to purchase Voting Securities pursuant to the
Shareholders Agreement) and DuPont does not deliver to the
Company, within five business days after becoming aware of such
Triggering Event, a written waiver of the DuPont Group's right to
acquire Voting Securities representing more than 20% of the Total
Voting Power pursuant to the proviso of paragraph 2(a).
<PAGE>
(b) The Company will cease to be subject to paragraph 3(a)
above at such time that the DuPont Group beneficially owns a
number of Voting Securities that represents less than 50% of the
DuPont Voting Power that the DuPont Group held immediately after
the Closing.
4. COVENANTS REGARDING BOARD REPRESENTATION
(a) As promptly as practicable after receipt of written
notice from DCEO and DuPont, the Company will cause two persons
designated by DCEO and DuPont to be elected to the Company's
Board of Directors. Such designation of any person for election
to the Company's Board of Directors, or to attend Board meetings
as an observer, shall be made after consultation with the
Company, and any such person shall be a person agreed to by the
Company (which agreement will not be unreasonably withheld). At
the time of any such designation, such designee will affirm his
or her duty of confidentiality to the Company with regard to any
non-public, confidential Company information through a
confidentiality agreement reasonably satisfactory to the Company
and DuPont. Until the Termination Date or earlier termination of
this Agreement in accordance with its terms, the Company's
nominating committee shall recommend to the Company's Board of
Directors that all persons designated by DCEO and DuPont for
election to the Company's Board of Directors in accordance with
the provisions of this paragraph (a) be included in the slate of
nominees recommended by such Board to the Company's shareholders
for election as directors at each annual meeting of the
shareholders of the Company. In the event that any designee of
DCEO and DuPont for election to the Company's Board of Directors
pursuant to the foregoing provisions shall cease to serve as a
director for any reason, the vacancy resulting therefrom shall be
filled according to the procedures described above.
(b) The Company will furnish to such designees on the
Company's Board of Directors all information that is provided to
the other directors of the Company.
(c) At any time that the DuPont Group does not have two
designees serving on the Board of Directors, DCEO and DuPont
shall be entitled to designate a non-voting observer for each
such Board seat and such observer(s) shall be entitled to attend
all Board meetings.
<PAGE>
(d) It is the Company's policy to discuss with the Board
of Directors any proposed merger, consolidation, reorganization
or acquisition or disposition of material assets other than in
the ordinary course of business and other transactions out of the
ordinary course of business which would have a material impact on
the Company's financial position or results of operations. If in
the future it should no longer be the Company's policy to present
any such matters to the Board, then the Company will, during the
term of this Agreement, discuss any such transactions with DuPont
in advance.
(e) The parties acknowledge and agree that any director or
observer nominated or designated by DCEO and DuPont will be under
an obligation to DuPont not to disclose to any person outside of
DuPont, or use in other than DuPont's business, any confidential
information or material relating to the business of DuPont or its
subsidiaries. The parties acknowledge that there shall be no
obligation on the part of such director or observer to disclose
any such information or material to the Company, even if such
disclosure would be of interest or value to the Company.
(f) The right of DCEO and DuPont to nominate up to two
designees to be a director or observer shall terminate at such
time that the DuPont Group beneficially owns a number of Voting
Securities that represents less than 50% of the DuPont Voting
Power that the DuPont Group held immediately after the Closing.
5. RIGHT OF FIRST REFUSAL
To the extent required by paragraph 2(g), any member of the
DuPont Group, prior to making any offer to sell, sale or transfer
of Voting Securities, shall give the Company the opportunity to
purchase such Voting Securities in the following manner:
(a) Any member of the DuPont Group intending to make such
offer, sale or transfer shall give notice (the "Transfer Notice")
to the Company in writing of such intention, specifying the
number of Voting Securities proposed to be disposed of and the
proposed price therefor, and the specific offer to purchase such
Voting Securities theretofore received and then remaining open,
identifying the offeror and setting forth all the terms of such
offer (including price). For purposes hereof a bona fide
third-party tender or exchange offer to purchase Voting
Securities shall be deemed to be an offer at the price specified
therein, without regard to any provisions thereof with respect to
proration or conditions to the offeror's obligation to purchase.
<PAGE>
(b) The Company shall have the right, exercisable by
written notice given by the Company to DuPont within thirty (30)
days after receipt of such Transfer Notice (or in the case of a
tender or exchange offer, no later than 24 hours prior to the
latest time by which Voting Securities must be tendered in order
to be accepted pursuant to such offer or to qualify for any
proration applicable to such offer, provided that the Transfer
Notice is received by the Company no later than five (5) business
days after the tender offer materials have been received by
DuPont) to exercise its right of first refusal to purchase (or to
cause a person or group designated by the Company to purchase)
all, but not a part of, the Voting Securities specified in such
Transfer Notice for cash at the price set forth therein.
(c) Except as set forth in Section 5(b) above, the
following procedures shall be followed with respect to a Transfer
Notice which includes any property other than cash:
(i) If the purchase price specified in the Transfer
Notice includes any property other than cash, such purchase price
shall be deemed to be the amount of any cash included in the
purchase price plus the value (as jointly determined by the
parties or, in the event the parties are unable to agree, by a
nationally or regionally recognized investment banking or
consulting firm (the "Property Valuation Firm"), which firm shall
be selected by two other previously chosen nationally or
regionally recognized investment banking or consulting firms,
each of which was chosen by DuPont and the Company, respectively,
of such other property included in such price. The parties shall
share equally the expenses incurred by the Property Valuation
Firm.
(ii) The parties shall use their best efforts to
cause any determination of the value of any securities included
in the purchase price to be made within three (3) business days
after the date of delivery of the Transfer Notice. If the
parties are unable to agree upon the value of any such securities
within such three-day period, the parties shall promptly (but in
no event later than five (5) business days after the date of
delivery of the Transfer Notice) cause the selection of the
Property Valuation Firm whose determination, which shall be made
within three (3) business days of its selection, shall be
conclusive.
<PAGE>
(iii) The parties shall use their best efforts to
cause any determination of the value of property other than
securities to be made within five (5) business days after the
date of delivery of the Transfer Notice. If the parties are
unable to agree upon a value within such five-day period, the
parties shall promptly (but in no event later than seven (7)
business days after the date of delivery of the Transfer Notice)
cause the selection of the Property Valuation Firm whose
determination, which shall be made within five (5) business days
of its selection, shall be conclusive.
(iv) If the above process to determine the value of
the other non-cash property is not completed within 15 calendar
days of the date of the Transfer Notice, then the Company's
exercise of its right of first refusal shall be extended until
fifteen (15) calendar days after the value of such other non-cash
property is determined or provided for in paragraphs 5(c)(i) and
5(c)(ii) above.
(d) If the Company exercises its right of first refusal
hereunder, the closing of the purchase of the Voting Securities
with respect to which such right has been exercised shall take
place within 30 calendar days (or if approval of such purchase by
the Company's shareholders is required by law or pursuant to any
stock exchange rule or policy, within 90 calendar days) after the
Company gives notice of such exercise. Upon exercise of its
right of first refusal, the Company shall use its best efforts to
secure all approvals required in connection therewith.
(e) If the Company does not exercise its right of first
refusal hereunder within the time specified for such exercise,
the DuPont Group shall be free during the period of 90 calendar
days following the expiration of such time for exercise to sell
the Voting Securities specified in such Transfer Notice to the
offeror identified therein at the price specified therein or at
any price in excess thereof. If the DuPont Group shall not have
completed such transfer within such 90-day period, the
restrictions or transfer imposed by this Section 4 shall again
apply to any proposed transfer of such Voting Securities.
<PAGE>
6. FURTHER UNDERSTANDINGS
(a) DuPont, DCEO and the Company shall use their best
efforts to further the purposes of this Agreement and the spirit
of cooperation which it evidences. Each party will refrain from
inducing or encouraging any other party to interfere with the
relationships and rights created hereby. The parties recognize
that the foregoing provisions of this paragraph (a) cannot and
should not be interpreted so as to restrict the ability of the
Board of Directors of the Company to take such action as such
Board may deem to be in the best interests of all the Company's
shareholders, or the ability of the Board of Directors of DuPont
to take such action as such Board may deem to be in the best
interests of DuPont's shareholders.
(b) The Company and DuPont each agree to advise the other
of any intention on the part of the Company or any member of the
DuPont Group, as the case may be, to acquire outstanding Voting
Securities of any class in order to insure that such acquisitions
of Voting Securities will conform to all applicable legal
requirements.
7. TERMINATION
(a) Notwithstanding any other provision of this Agreement,
either DuPont and DCEO or the Company may terminate this
Agreement, in its sole discretion, if (i) the other party fails
to perform or observe any of its obligations pursuant to this
Agreement or (ii) DCEO's and DuPont's designees pursuant to
paragraph 4 are not elected to the positions specified therein
(except as provided for in paragraph 4(f)). In addition, the
Company shall have the right to terminate this Agreement, in its
sole discretion, as provided in paragraph 8(b).
(b) In the event of the termination of this Agreement
pursuant to this paragraph 7, unless the parties otherwise agree,
DCEO and DuPont will cause all its respective designees serving
on the Board of Directors of the Company pursuant to paragraph 4
to resign from such Board of Directors effective as of the date
of such termination.
8. MISCELLANEOUS
(a) DuPont, on the one hand, and the Company, on the
other, acknowledge and agree that irreparable damage would occur
in the event any of the provisions of this Agreement were not
<PAGE>
performed in accordance with their specific terms or were
otherwise breached. It is accordingly agree that the parties
shall be entitled to an injunction or injunctions to prevent
breaches of the provisions of this Agreement and to enforce
specifically the terms and provisions hereof in any court of the
United States or any state thereof having jurisdiction, in
addition to any other remedy to which they may be entitled at law
or equity.
(b) If any provision of this Agreement is in violation of
any statute, rule, regulation, order or decree of any
governmental authority, court or agency, or subjects any member
of the DuPont Group to governmental regulation to which it would
not be subject except for such provision, then such member of the
DuPont Group shall be relieved of its obligations under such
provision to the minimum extent necessary to cure such violation
or eliminate the applicability of such regulation; and provided
further that in the event any member of the DuPont Group is
relieved of its obligations under any provision of this Agreement
pursuant to this paragraph, the Company may terminate this
Agreement, in its sole discretion.
(c) If requested in writing by the Company, DuPont shall
present or cause to be presented promptly all certificates
representing Voting Securities now owned or hereafter acquired by
members of the DuPont Group, for the placement thereon of the
following legend, which will remain thereon as long as such
Voting Securities are subject to the restrictions contained in
this Agreement:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE
ARE SUBJECT TO THE PROVISIONS OF AN AGREEMENT DATED
AS OF JANUARY 29, 1997, BETWEEN E. I. DU PONT DE NEMOURS
AND COMPANY AND HUDSON TECHNOLOGIES, INC., AND MAY NOT
BE SOLD OR TRANSFERRED EXCEPT IN ACCORDANCE THEREWITH.
A COPY OF SAID AGREEMENT IS ON FILE AT THE OFFICE
OF THE CORPORATE SECRETARY OF HUDSON TECHNOLOGIES, INC.
The Company may enter a stop transfer order with the transfer
agent or agents of Voting Securities against the transfer of
Voting Securities except in compliance with the requirements of
this Agreement. The Company agrees to remove promptly any stop
transfer order with respect to, and issue promptly unlegended
certificates in substitution for, certificates for any Voting
Securities that are no longer subject to the restrictions
contained in this Agreement.
<PAGE>
(d) As used herein, the term "affiliate" shall have the
meaning set forth in Rule 12b-2 under the Exchange Act (as in
effect on January 29, 1997), and the term "person" shall mean any
individual, partnership, corporation, trust or other entity.
(e) This Agreement, the Stock Purchase Agreement, the
Shareholders Agreement and the Registration Agreement contain the
entire understanding of the parties with respect to the
transactions contemplated hereby and this Agreement may be
amended only by an agreement in writing executed by the parties
hereto.
(f) Descriptive headings are for convenience only and
shall not control or affect the meaning or construction of any
provision of this Agreement.
(g) For the convenience of the parties, any number of
counterparts of this Agreement may be executed by the parties
hereto and each such executed counterpart shall be deemed to be,
an original instrument.
(h) All notices, requests, demands and other
communications hereunder shall be in writing and shall be deemed
given if delivered personally or mailed by certified or
registered mail, postage prepaid, return receipt requested, or
delivered to a nationally recognized next business day courier
for delivery on the next business day, or by facsimile, with a
copy sent as aforesaid and in any instance addressed as follows:
THE COMPANY:
Hudson Technologies, Inc.
25 Torne Valley Road
Hillburn, New York 10931-9900
Attention: President
DUPONT:
E. I. du Pont de Nemours and Company
1007 Market Street
Wilmington, Delaware 19898
Attention: Vice President and Treasurer
<PAGE>
DCEO:
Du Pont Chemical and Energy Operations, Inc.
DuPont Building, Room 8045
1007 Market Street
Wilmington, Delaware 19898
Attention: Administrator --
Du Pont Chemical and Energy Operations, Inc.
or such other address as shall be furnished in writing by any of
the parties, and any such notice or communication shall be deemed
to have been given as of the date so delivered personally, so
mailed, so delivered to the courier service, or so transmitted by
telecopy (except that a notice of change of address shall not be
deemed to have been given until received by the addressee).
(i) From and after the Termination Date or earlier
termination of this Agreement in accordance with its terms, the
covenants of the parties set forth herein shall be of no further
force or effect and the parties shall be under no further
obligation with respect thereto.
(j) This Agreement shall be governed by and construed and
enforced in accordance with the laws of the State of Delaware
applicable to contracts made and to be performed therein.
(k) Each capitalized term not defined herein shall have
the meaning assigned to it by the provisions in which it is first
used, or if not defined in this Agreement, the meaning assigned
to it by the Stock Purchase Agreement.
IN WITNESS THEREOF, DuPont and the Company have caused
this Agreement to be duly executed by their respective officers,
each of whom is duly authorized, all as of the day and year first
above written.
E. I. DUPONT DE NEMOURS AND COMPANY
By /s/ Mark E. Stookey
Name: Mark E. Stookey
Title: Attorney-in-Fact
DU PONT CHEMICAL AND ENERGY OPERATIONS, INC.
By /s/ Mark D. Matthews
Name: Mark D. Matthews
Title: Attorney-in-Fact
HUDSON TECHNOLOGIES, INC.
By /s/ Kevin J. Zugibe
Name: Kevin J. Zugibe
Title: President
<PAGE>
Exhibit E
REGISTRATION AGREEMENT
This Registration Agreement (the "Registration Agreement")
is made and entered into as of January 29, 1997, between DU PONT
CHEMICAL AND ENERGY OPERATIONS, INC., a Delaware corporation
("DCEO"), E. I. DU PONT DE NEMOURS AND COMPANY, a Delaware
corporation ("DUPONT") and HUDSON TECHNOLOGIES, INC., a New York
corporation ("HTI" or the "Company").
W I T N E S S E T H :
WHEREAS, DCEO, DUPONT and HTI are, simultaneously with this
Registration Agreement, entering into a certain Stock Purchase
Agreement ("Stock Purchase Agreement") to provide a constructive
and mutually beneficial relationship between HTI, DUPONT and
DCEO, including the purchase of certain shares of Common Stock,
par value $0.01 per share of HTI.
NOW, THEREFORE, in consideration of the respective
agreements herein contained and in order to induce DCEO to enter
into the Investment Agreement, the parties agree as follows:
1. DEMAND REGISTRATION
(a) The demand registration rights of DCEO set forth in
Section 1 of this Registration Agreement may only be exercised by
DCEO (i) anytime between January 29, 1999 and January 29, 2002,
and (ii) only one (1) time, after which such demand registration
rights shall terminate.
(b) Subject to Section l(a), in the event that HTI shall
receive a written request from DCEO that HTI register under the
Securities Act of 1933, as amended (the "Act") on Form S-3, or
any other similar form then in effect, and provided that HTI is
eligible to use such Form S-3, at least 500,000 Shares of Common
Stock then owned by DCEO (the "Shares"), HTI agrees that it will
use its best efforts to promptly file (but in no event more than
forty-five (45) days after such request) a registration statement
and to cause such registration statement to become effective as
soon as practicable. In the case of any registration pursuant to
this Section 1 which involves a firm commitment underwritten
public offering, the managing underwriter or underwriters shall
be selected by DCEO and approved by HTI, which approval shall not
<PAGE>
be unreasonably withheld, and HTI agrees to enter into an
underwriting agreement in customary form with such underwriters.
HTI will use its best efforts to cause any such registration to
remain effective (with a prospectus at all times meeting the
requirements of the Act) for 90 days from the effective date of
the registration statement and will use its best efforts to
effect such qualifications under applicable Blue Sky or other
state securities laws as may be reasonably requested by DCEO
(provided that HTI shall not be obligated to file a general
consent to service of process or to qualify to do business as a
foreign corporation or to otherwise subject itself to taxation
solely for the purpose of any such qualification) to permit or
facilitate such sale or other distribution. Notwithstanding the
above, the Company will not be obligated to undergo an audit of
its financial statements other than in the ordinary course of its
business.
(c) The Company may postpone for up to 60 days the filing
or the effectiveness of a registration statement for a Demand
Registration if the President of the Company delivers a written
certificate to DCEO certifying that the Company's Board of
Directors (evidenced by a resolution) has determined that public
disclosure in a Registration Statement of certain information
concerning the Company at that time would materially adversely
affect the financial position or business of the Company;
provided that in any such event, DCEO may withdraw such request
and that, if such request is withdrawn, such request will not be
deemed a Demand Registration. The Company may only make one
election in any 12-month period to postpone a Demand Registration
pursuant hereto.
2. PIGGYBACK REGISTRATION
(a) The piggyback registration rights of DCEO set forth in
Section 2 of this Registration Agreement may be exercised by DCEO
anytime between January 29, 1998 and January 29, 2002.
(b) Subject to Section 2(a), if HTI shall take action to
register any of its common stock for sale to the public for cash,
it shall promptly give DCEO written notice of its intention so to
do (such notice shall in no event be given later than five (5)
business days after HTI and its underwriter have signed a letter
of intent with respect to such offering) and shall use its best
efforts to promptly file (but in no event more than forty-five
(45) days after such request) a registration statement and to
<PAGE>
cause such registration statement to become effective as soon as
practicable including such number of the Shares held by DCEO as
may be specified by written notice from DCEO delivered to HTI
within fifteen (15) days after receiving the written notice by
HTI of its intention to register; provided, however, that HTI
shall not be required to honor any such request of DCEO unless
such request involves registration of at least 100,000 Shares;
provided, however, that if, in the written opinion of the
Company's managing underwriter, if any, for such offering, the
inclusion of all or a portion of the Shares requested to be
registered will exceed the maximum amount of the Company's
securities which can be marketed (i) at a price reasonably
related to their then current market value, or (ii) without
otherwise materially adversely affecting the entire offering,
then (x) the Company may exclude from such offering all or a
portion of the Shares which it has been requested to register or
(y) if the underwriter so requests, such Shares shall not be sold
until the expiration of 90 days from the effective date of the
offering that gave rise to the piggyback registration rights that
are the subject of this Section 2.
(c) Notwithstanding the provisions of this Section 2, the
Company shall have the right at any time after it shall have
given written notice pursuant to this Section 2 (irrespective of
whether any written request for inclusion of Shares shall have
already been made) to elect not to file any such proposed
registration statement, or to withdraw the same after the filing
but prior to the effective date thereof.
3. PROSPECTUSES, DOCUMENTS, ETC.
Upon making a request for demand registration pursuant to
Section 1 hereof or for piggyback registration pursuant to
Section 2 hereof, DUPONT shall furnish to HTI such information
regarding DCEO's holdings and the proposed manner of distribution
thereof as shall be reasonably required in connection with any
registration, qualification or compliance referred to in such
Sections, and shall otherwise reasonably cooperate with HTI in
the preparation and filing of any registration statement,
amendment or supplement required thereunder and in any efforts by
HTI to establish any exemptions under federal and state
securities laws. HTI agrees that it will furnish to DUPONT the
number of prospectuses, offering circulars or other documents, or
any amendments or supplements thereto, incident to any
registration, qualification or compliance referred to in Section
1 hereof as DCEO from time to time may reasonably request.
<PAGE>
4. EXPENSES
The obligations of HTI to register Shares held by DCEO
shall be subject to the following terms and conditions:
(a) With respect to a demand registration, DUPONT shall
pay all expenses of such registration, including (i) all
underwriters' discounts and commissions, (ii) all expenses
(including filing fees) incurred in connection with qualifying
under state securities or Blue Sky laws, (iii) all other filing
fees, (iv) the cost of any customary insurance policy that the
underwriters may, in the exercise of their sole discretion,
require in connection with such registration, (v) the reasonable
fees of HTI's legal counsel, (vi) the fees of DUPONT's legal
counsel, (vii) reasonable audit and other accounting fees and
expenses, and (viii) printing costs (together the "Registration
Costs").
(b) With respect to a piggyback registration, DUPONT shall
pay its proportionate share of all expenses of such registration
(the proportion to be the number of Shares being so registered at
DUPONT's request as compared to the total number of shares of
common stock being so registered), including (i) all
underwriters' discounts and commissions in connection with the
Shares sold by DCEO, (ii) its proportionate share of all expenses
(including filing fees) incurred in connection with the
qualifying under state securities or Blue Sky laws, except that
with respect to any states requested by DUPONT and not the
underwriters, DUPONT shall pay all expenses incurred in
connection with qualifying under the state securities or Blue Sky
laws of such states, (iii) its proportionate share of all other
filing fees, (iv) its proportionate share of the fees of HTI's
legal counsel, (v) all of the fees of DUPONT's legal counsel,
(vi) its proportionate share of audit and other accounting fees
and expenses, and (vii) its proportionate share of printing
costs.
5. INDEMNIFICATION RELATING TO A REGISTRATION STATEMENT
(a) Whenever pursuant to Section 1 or Section 2 hereof a
registration statement relating to Shares is filed under the Act,
HTI will indemnify and hold harmless DUPONT and DCEO, each
<PAGE>
underwriter of any such Shares and each person, if any, who
controls any such underwriter, against any losses, claims,
damages or liabilities, joint or several, to which DUPONT and
DCEO, any such underwriter or any such controlling person may
become subject under the Act or otherwise, including any amount
paid in settlement of any litigation, commenced or threatened, if
such settlement is effected with the written consent of HTI, and
to reimburse them for all legal or other expenses reasonably
incurred by them in connection with investigating or defending
against such loss, claim, damage, or liability (or actions in
respect thereof), insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are
based upon any untrue statement or misrepresentation or alleged
untrue statement of a material fact contained in such
registration statement, or preliminary, final or summary
prospectus contained therein, as may be amended or supplemented,
or arise out of or are based upon the omission or alleged
omission to state therein a material fact required to be stated
therein or necessary in order to make the statements therein not
misleading, unless such untrue statement or omission was made in
such registration statement or final prospectus in reliance upon
and in conformity with information furnished in writing to the
Company in connection therewith by DUPONT or any such underwriter
or any such person through DUPONT or the underwriter expressly
for use therein; provided, however, that the indemnity agreement
contained in this Section 5 with respect to any Preliminary
Prospectus will not inure to the benefit of the underwriter (or
to the benefit of any other person that may be indemnified
pursuant to this Section 5 if (A) the person asserting any such
losses, claims, damages, expenses or liabilities purchased the
Shares which are the subject thereof from the underwriter or
other indemnified person; (B) the underwriter or other
indemnified person failed to send or give a copy of the
Prospectus to such person at or prior to the written confirmation
of the sale of such Shares to such person; and (C) the Prospectus
did not contain any untrue statement or alleged untrue statement
or omission or alleged omission giving rise to such cause, claim,
damage, expense or liability.
(b) Whenever pursuant to Section 1 or 2 hereof a
registration statement relating to Shares is filed under the Act,
DUPONT and DUPONT's underwriter of the Shares to be registered
and each person, if any, who controls any such underwriter (each
such party being referred to severally in this subsection (b) as
the "indemnifying party"), will jointly and severally indemnify
<PAGE>
and hold harmless HTI, each of its directors, each of its
officers and agents who have signed such registration statement
(including consents) and each other person, if any, who controls
HTI, in the same manner and to the same extent as set forth in
subsection (a) of this Section 5, with respect to any untrue
statement or alleged untrue statement of a material fact
contained in such registration statement, or preliminary, final
or summary prospectus contained therein, as may be amended or
supplemented, or with respect to any omission or alleged omission
to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, but only
if, and to the extent that, such untrue statement, alleged untrue
statement or omission or alleged omission was made in reliance
upon and in conformity with written information furnished to HTI
by an indemnifying party specifically for use in the preparation
thereof.
(c) Promptly after receipt by an indemnified party under
subsection (a) or (b) of this Section 5 of notice of the
commencement of any action, such indemnified party will, if a
claim in respect thereof is to be made against the indemnifying
party under such clause, notify the indemnifying party in writing
of the commencement thereof; but the omission so to notify the
indemnifying party will not relieve the indemnifying party from
any liability which it may have to any indemnified party
otherwise than under such subsections. In case any such action
shall be brought against any indemnified party, and it shall
notify the indemnifying party of the commencement thereof, the
indemnifying party will be entitled to participate therein, and,
jointly with any other indemnifying party similarly notified, to
assume the defense thereof (unless such indemnified party
reasonably objects to such assumption on the ground that there
may be legal defenses available to it which are different from or
in addition to those available to such indemnifying party) with
counsel satisfactory to such indemnified party. After such an
assumption, the indemnifying party shall not be liable to such
indemnified party under such subsection for any legal or other
expenses subsequently incurred by such indemnified party in
connection with the defense thereof other than reasonable costs
of investigation.
(d) For purposes of this Section 5 the terms "control",
"controlling person" and "underwriter" have the meanings which
they have in and under the Act.
<PAGE>
6. MISCELLANEOUS
(a) DUPONT, DCEO and HTI acknowledge and agree that
irreparable damage would occur in the event any of the provisions
of this Registration Agreement were not performed in accordance
with their specific terms or were otherwise breached. It is
accordingly agreed that the parties shall be entitled to an
injunction or injunctions to prevent breaches of the provisions
of this Registration Agreement and to enforce specifically the
terms and provisions hereof in any court of the United States or
any State thereof having jurisdiction, in addition to any other
remedy to which any of them may be entitled by law or equity.
(b) All notices, consents, requests, instructions,
approvals and other communications provided for herein and all
legal process in regard hereto shall be validly given, made or
served, if in writing and delivered or mailed as provided in the
Stock Purchase Agreement.
(c) This Registration Agreement, the Stock Purchase
Agreement, the Shareholders' Agreement and the Standstill
Agreement contain the entire understanding of the parties with
respect to the transactions contemplated hereby and this
Registration Agreement may be amended only by an agreement in
writing executed by the parties hereto.
(d) For the convenience of the parties, any number of
counterparts of this Registration Agreement may be executed by
the parties hereto and each such executed counterpart shall be,
and shall be deemed to be, an original instrument.
(e) Descriptive headings are for convenience only and
shall not control or affect the meaning or construction of any
provisions of this Registration Agreement.
(f) This Registration Agreement shall be binding upon the
respective successors and assigns of DUPONT, DCEO and HTI.
(g) This Registration Agreement shall be governed by and
construed in accordance with the laws of the State of Delaware
applicable to contracts made and to be performed therein.
(h) As used herein the term "person" shall mean any
individual, partnership, corporation, trust or other entity.
<PAGE>
7. DEFINITIONS
Each capitalized term used and not otherwise defined
herein shall have the meaning assigned to it by the Stock
Purchase Agreement.
IN WITNESS WHEREOF, DUPONT, DCEO and HTI have caused this
Registration Agreement to be duly executed by their respective
officers, each of whom is duly authorized, all as of the day and
year first above written.
E. I. DUPONT DE NEMOURS AND COMPANY
By /s/ Mark E. Stookey
Name: Mark E. Stookey
Title: Attorney-in-Fact
DU PONT CHEMICAL AND ENERGY OPERATIONS, INC.
By /s/ Mark D. Matthews
Name: Mark D. Matthews
Title: Attorney-in-Fact
HUDSON TECHNOLOGIES, INC.
By /s/ Kevin J. Zugibe
Name: Kevin J. Zugibe
Title: President
