<PAGE> 1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. __)*
Galileo Corporation
- --------------------------------------------------------------------------------
(Name of Issuer)
Common Stock, $.01 par value per share
- --------------------------------------------------------------------------------
(Title of Class of Securities)
363544107
--------------------------------------------
(CUSIP Number)
John F. Blais, Jr.
Optical Filter Corporation
2 Mercer Road, Natick, Massachusetts 01760 (508) 655-1650
- --------------------------------------------------------------------------------
(Name, Address and Telephone Number of Person Authorized to Receive Notices
and Communications)
January 30, 1998
-----------------------------------------------------------
(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> 2
SCHEDULE 13D
- ---------------------------- ---------------------------------------------
CUSIP No. 363544107 Page 2 of 7 Pages
-------------
- ---------------------------- ---------------------------------------------
- --------------------------------------------------------------------------------
1 NAME OF REPORTING PERSONS AND S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE
PERSONS (entities only)
John F. Blais, Jr.
- --------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ] (b) [ ]
Not Applicable
- --------------------------------------------------------------------------------
3 SEC USE ONLY
- --------------------------------------------------------------------------------
4 SOURCE OF FUNDS*
PF
- --------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEMS 2(d) or 2(e) [ ]
Not Applicable
- --------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
United States of America
- --------------------------------------------------------------------------------
7 SOLE VOTING POWER
NUMBER OF
SHARES 868,413 Shares
BENEFICIALLY ----------------------------------------------------
OWNED BY 8 SHARED VOTING POWER
EACH
REPORTING 0
PERSON ----------------------------------------------------
WITH 9 SOLE DISPOSITIVE POWER
752,987 Shares
----------------------------------------------------
10 SHARED DIPOSITIVE POWER
0
- --------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
868,413 Shares
- --------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES* [ ]
Not Applicable
- --------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
Approximately 10.8 %
- --------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
IN
================================================================================
*SEE INSTRUCTIONS BEFORE FILLING OUT
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7
(INCLUDING EXHIBITS) OF THE SCHEDULE, AND THE SIGNATURE ATTESTATION.
<PAGE> 3
Schedule 13D Page 3 of 7 Pages
John F. Blais, Jr.
Item 1. Security and Issuer
The class of security to which this statement relates is the common
stock, par value $.01 per share ("Common Stock"), of Galileo Corporation, a
Delaware corporation (the "Issuer"). The name and address of the principal
executive office of the Issuer is Galileo Corporation, Galileo Park, P.O. Box
550, Sturbridge, Massachusetts 01566.
Item 2. Identity and Background
(a) The name of the person filing this statement is John F. Blais, Jr.
(b) The business address of the person filing this statement is c/o Optical
Filter Corporation, 2 Mercer Road, Natick, Massachusetts 01760.
(c) The present principal occupation of the person filing this statement is
President of Optical Filter Corporation, 2 Mercer Road, Natick,
Massachusetts 01760.
(d) The response to this item is negative.
(e) The response to this item is negative.
(f) Mr. Blais is a citizen of the United States of America.
Item 3. Source and Amount of Funds or Other Consideration.
On December 30, 1997, the Issuer, OFC Acquisition Corporation, a
Delaware corporation and wholly-owned subsidiary of the Issuer ("Acquisition"),
OFC Corporation, a New Hampshire corporation ("OFC"), and certain principal
stockholders of OFC entered into an Agreement and Plan of Merger (the "Merger
Agreement"), pursuant to which OFC would merge with and into Acquisition (the
"Merger"). In connection with the Merger, the Issuer agreed to issue and deliver
1,154,258 shares of its common stock (the "Merger Stock") and pay cash in the
amount of $6,000,000 to the stockholders of OFC. For purposes of the Merger, the
Merger Stock was valued at $12.129 per share.
On January 30, 1998, the Merger was consummated, and the Issuer issued
and delivered 1,038,832 shares of Common Stock and $5,700,000 in cash to the
stockholders of OFC. As a stockholder of OFC, John F. Blais, Jr. received
752,987 shares of Common Stock on this date.
Also on January 30, 1998, Galileo issued 115,426 shares of Common Stock
(the "Escrow Shares") and deposited such shares and $300,000 in cash into
escrow. Mr. Blais has an ownership interest in 83,665 of the Escrow Shares.
Pursuant to the terms of the Merger Agreement and a related Escrow Agreement
dated January 30, 1998, between the Issuer, Mr. Blais as the representative of
the stockholders of OFC, and State Street Bank and Trust Company as escrow
agent, the Escrow Shares and such cash may be used to indemnify the Issuer in
accordance with the terms of the Merger Agreement. Until the Escrow Shares are
released from escrow six months after the consummation of the Merger (assuming
no claim for indemnification
<PAGE> 4
Schedule 13D Page 4 of 7 Pages
John F. Blais, Jr.
is made), Mr. Blais, as the representative of the stockholders of OFC, retains
the power to vote all such shares.
Accordingly, Mr. Blais is the beneficial owner of 868,413 of Common
Stock as of January 30, 1998.
Item 4. Purpose of Transaction.
Please see explanation set forth above with respect to Item 3 for the
purposes of the acquisition of securities of the issuer. The reporting person
has no plans or proposals which may relate to or would result in any of the
matters described pursuant to the lettered subparagraphs of this item.
Accordingly, the answers to Item 4 are as follows:
(a) Not applicable.
(b) Not applicable.
(c) Not applicable.
(d) Not applicable.
(e) Not applicable.
(f) Not applicable.
(g) Not applicable.
(h) Not applicable.
(i) Not applicable.
(j) Not applicable
Item 5. Interest in Securities of the Issuer.
(a) The aggregate number and percentage of shares of Common Stock
beneficially owned by John F. Blais, Jr. are 868,413 and approximately
10.8 % of the issued and outstanding shares of Common Stock as
disclosed in the Issuer's Form 10-K Report for the fiscal year ended
September 30, 1997.
(b) Mr. Blais has the sole power to vote 868,413 shares of Common Stock.
Mr. Blais has the sole power to dispose of 752,987 shares of Common
Stock.
(c) The only transaction in the Common Stock that was effected by Mr. Blais
during the past sixty days is the transaction described in Item 3
above.
(d) Not applicable.
<PAGE> 5
Schedule 13D Page 5 of 7 Pages
John F. Blais, Jr.
(e) Not applicable.
Item 6. Contracts, Arrangements, Understandings or Relationships with
Respect to Securities of the Issuer.
In connection with the Merger Agreement referred to in Item 3 above,
Mr. Blais, the Issuer and certain other parties as indicated entered into the
following agreements:
On December 30, 1997, the Issuer, Mr. Blais and certain other
stockholders of OFC entered into a Stock Restriction and Registration Rights
Agreement that provides for registration of the Merger Stock under the
Securities Act of 1933.
On January 30, 1998, Mr. Blais and the Issuer entered into a Standstill
Agreement that provides that for a period of five years Mr. Blais will not,
without prior written consent of the Issuer: (a) acquire voting stock of the
Issuer; (b) deposit any shares of voting stock of the Issuer in a voting trust
or subject any voting stock to any arrangement or agreement with respect to the
voting thereof; (c) join or otherwise act with any third party for the purpose
of acquiring, holding or disposing of voting stock of the Issuer; (d) sell or
otherwise transfer to any third party Common Stock that would represent at the
time of such transfer more than one percent of the Issuer's then issued and
outstanding Common Stock, except for sales made in the public market in
accordance with Rule 144 or pursuant to a registration statement filed by the
Issuer under the Securities Act of 1933.
On January 30, 1998, the Issuer, Mr. Blais as the representative of the
stockholders of OFC, and State Street Bank and Trust Company as escrow agent
entered into an Escrow Agreement giving Mr. Blais the power to vote the Escrow
Shares until they are released from escrow.
Item 7. Material to be Filed as Exhibits.
Attached to this statement and filed with this statement as Exhibits
are the following documents:
EXHIBIT A: Agreement and Plan of Merger dated December 30, 1997
among the Issuer, OFC Acquisition Corporation, a
Delaware corporation and wholly-owned subsidiary of
the Issuer, OFC Corporation, a New Hampshire
corporation, and certain principal stockholders of
OFC named therein (filed as exhibit 2.1 to the
Issuer's Form 8-K filed January 7, 1998, file no.
33-13752, and incorporated herein by reference).
EXHIBIT B: Stock Restriction and Registration Rights Agreement
dated December 30, 1997 between the Issuer, OFC, Mr.
Blais and certain other stockholders of OFC.
EXHIBIT C: Standstill Agreement dated as of January 30, 1998
between the Issuer and Mr. Blais.
<PAGE> 6
Schedule 13D Page 6 of 7 Pages
John F. Blais, Jr.
EXHIBIT D: Escrow Agreement dated as of January 30, 1998 among
the Issuer, Mr. Blais as the representative of the
stockholders of OFC and State Street Bank and Trust
Company as escrow agent.
The foregoing descriptions of these Exhibits are qualified in their
entirety by reference to the Exhibits themselves.
<PAGE> 7
Schedule 13D Page 7 of 7 Pages
John F. Blais, Jr.
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.
February 3, 1998 /s/ John F. Blais, Jr
- ------------------------------ -----------------------------
Date John F. Blais, Jr.
<PAGE> 1
EXHIBIT B
---------
STOCK RESTRICTION AND
REGISTRATION RIGHTS AGREEMENT
This Stock Restriction and Registration Rights Agreement dated as of
December 30, 1997 is between Galileo Corporation (the "Company"), a Delaware
corporation, and the undersigned holders (the "Holders") of shares (the "OFC
Shares") of common stock and options to purchase shares of common stock (the
"OFC Options") of OFC Corporation ("OFC"), a New Hampshire corporation. This
Agreement is made in connection with the execution of the Agreement and Plan of
Merger dated as of the date hereof (the "Merger Agreement") pursuant to which
OFC will merge with and into a subsidiary of the Company (the "Merger") and the
Holders will receive shares of common stock of the Company (the "Shares") in
exchange for their OFC Shares and Options.
The parties hereto agree as follows:
SECTION 1 - REPRESENTATIONS, WARRANTIES
AND AGREEMENTS OF HOLDERS
Each Holder severally represents, warrants and agrees as to itself as
follows:
1.1 AUTHORITY; NO BREACH. The Holder has the legal power and authority
to execute, deliver and perform its obligations under this Agreement. This
Agreement has been duly executed and delivered by and is the valid and binding
obligation of the Holder, enforceable against it in accordance with its terms,
subject to general principles of equity and to bankruptcy, insolvency and
similar laws affecting creditors' rights and remedies generally. The Holder has
obtained all governmental and other consents and approvals required for it to
execute, deliver and perform its obligations under this Agreement, and such
execution, delivery and performance will not violate or constitute (or with
notice or lapse of time or both would constitute) a default under any agreement,
order or judgment binding upon the Holder or its property.
1.2 TITLE TO OFC SHARES. The Holder owns beneficially and of record,
free and clear of any lien, encumbrance or adverse claim, the OFC Shares and
Options set forth opposite the Holder's name in the Seller Disclosure Schedule
delivered pursuant to the Merger Agreement. There are no shareholder agreements,
voting trusts, proxies or other agreements or understandings with respect to the
outstanding shares of capital stock of OFC to which the Holder is a party.
1.3 APPROVAL OF MERGER. The Holder has duly and validly approved the
Merger Agreement in accordance with the New Hampshire Business Corporation Act
and will not modify or rescind such approval.
1.4 CONTINUITY OF INTEREST. The Holder has no current plan or
intention, and the Holder knows of no plan (written or oral) of the other
Holders, to engage in any sale, exchange, transfer, pledge, or other transaction
that would reduce the risk of ownership (collectively, a
<PAGE> 2
"Sale") of any of the Shares received in the Merger. Notwithstanding the above,
the Holder may engage in a Sale of any Shares released to the Holder under the
terms of the Escrow Agreement referred to in Section 1.10 of the Merger
Agreement (the "Escrow Agreement") without violating the representations in this
Section 1.4 if, after such Sale, the aggregate fair market value (determined as
of the date of the Merger) of the Shares retained by the Holders (excluding any
Shares which continue to be held by the Escrow Agent under the terms of the
Escrow Agreement) equals or exceeds 50 percent of the fair market value of the
OFC Shares outstanding immediately prior to the Merger. For purposes of this
representation, OFC Shares exchanged for cash or other property and OFC Shares
exchanged for cash in lieu of fractional Shares will be treated as outstanding
immediately prior to the Merger. A Sale of the Shares for purposes of this
Section 1.4 includes any Sale or redemption in contemplation of, or related or
pursuant to the Merger Agreement, including a Sale or redemption of OFC Shares
prior to the Merger.
1.5 INVESTMENT REPRESENTATION. The Holder is acquiring the Shares for
the Holder's own account for investment and not with a view to, or for sale in
connection with, any distribution thereof, nor with any present intention of
distributing the Shares. The Holder acknowledges that the Shares are restricted
securities that are unregistered; that the Holder must hold the Shares
indefinitely unless they are subsequently registered under the Securities Act of
1933 (the "Securities Act") or an exemption from such registration is available;
and that the registration rights provisions of this Agreement constitute the
only obligation of the Company to register the Shares.
1.6 RECEIPT OF INFORMATION. The Holder acknowledges receipt of the
Company's Annual Report on Form 10-K for the year ended September 30, 1997 and
Proxy Statement for the 1998 annual meeting of shareholders. The Holder further
acknowledges that the Holder has had the opportunity to obtain such additional
information and to ask such questions as the Holder considered necessary in
connection with the receipt of the Shares.
1.7 RESTRICTION ON TRANSFER. The Holder will not sell, transfer,
distribute or otherwise dispose of the Shares except (i) pursuant to an
effective registration statement under the Securities Act as then in effect
covering the Shares and proposed distribution or (ii) upon first furnishing to
the Company an opinion of counsel satisfactory to it stating that the proposed
disposition is not in violation of the registration requirements of the
Securities Act and such undertakings and agreements with the Company by the
proposed transferee as the Company may reasonably require to ensure compliance
with the Securities Act. Each certificate representing the Shares will bear a
legend substantially in the following form:
The shares represented by this certificate have not been registered
under the Securities Act of 1933 and may not be transferred or
otherwise disposed of unless and until (i) the shares are registered
under the Act or (ii) an opinion of counsel satisfactory to the Issuer
to the effect that registration under the Act is not required, and such
undertakings as the Issuer may reasonably require to ensure compliance
with the Act, are furnished
The Holder understands that the certificates representing the Shares will be
placed on the "stop-transfer list" maintained by the Company's transfer agent
and will remain so listed so long as the restrictions imposed on the Shares
under this Agreement remain in effect.
- 2 -
<PAGE> 3
SECTION 2 - REGISTRATION RIGHTS
2.1 RESALE REGISTRATION. The Company will within 30 days after the date
of the closing of the Merger prepare and file a Registration Statement under the
Securities Act covering the resale by each Holder of the Holder's Shares from
time to time in transactions not involving an underwritten public offering and
will thereafter use reasonable efforts to cause the Registration Statement to be
declared effective by the Securities and Exchange Commission (the "Commission")
as soon as practicable thereafter and to keep the Registration Statement
continuously effective for a period of two years following the Merger or such
other period as may be specified in Rule 144(k) under the Securities Act or any
successor provision, but in no event after the date on which the Holder no
longer holds any Shares registered under the Registration Statement. In
connection with the foregoing:
(a) The Company will promptly (subject to Section 2.2) prepare and file
with the Commission such amendments and post-effective amendments to the
Registration Statement as may be necessary to keep the Registration Statement
effective for as long as such registration is required to remain effective
hereunder; will cause the Prospectus to be supplemented by any required
Prospectus supplement, and, as so supplemented, to be filed pursuant to Rule 424
under the Securities Act; and will comply with the provisions of the Securities
Act applicable to it with respect to the disposition of all Shares covered by
such Registration Statement during the applicable period in accordance with the
intended methods of disposition by the Holders set forth in the Registration
Statement or supplement to the Prospectus.
(b) The Company will promptly furnish to each Holder such number of
copies of the Prospectus (including each preliminary Prospectus) and any
amendments or supplements thereto as the Holder may reasonably request in order
to facilitate the public sale or other disposition of the Shares being sold by
the Holder.
(c) The Company will, on or prior to the date on which the Registration
Statement is declared effective, use reasonable efforts to register or qualify
the Shares covered by the Registration Statement under such securities or "blue
sky" laws, if any, as may be applicable of such states of the United States as
any Holder reasonably requests; provided, however, that the Company shall not be
required to qualify generally to do business in any jurisdiction where it would
not otherwise be required to qualify or to file any general consent to service
of process.
(d) The Company will promptly give notice to each Holder (i) when the
Prospectus or any Prospectus supplement or post-effective amendment has been
filed and, with respect to the Registration Statement or any post-effective
amendment, when the same has become effective, (ii) of any request by the
Commission or any state securities authority with jurisdiction for amendments
and supplements to the Registration Statement and Prospectus or for additional
information after the Registration Statement has become effective, (iii) of the
issuance by the Commission of any stop order suspending the effectiveness of the
Registration Statement, (iv) of the issuance by any state securities commission
or other regulatory authority with jurisdiction of any order suspending the
qualification or exemption from qualification of any of the Shares under any
applicable state securities or "blue sky" laws and (v) of the happening of any
event which makes any statement made in the Registration Statement or related
Prospectus untrue or which requires the making of any changes in the
Registration Statement or Prospectus so that
- 3 -
<PAGE> 4
they will not contain any untrue statement of a material fact or omit to state
any material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading. As soon as practicable following any of such events, but in any
case not later than the expiration of the period for suspension of disposition
of the Shares under Section 2.2, the Company will prepare and file with the
Commission and furnish such supplement or amendment to such Prospectus as may be
necessary so that, as thereafter deliverable to the purchasers of the Shares,
such Prospectus will not contain any untrue statement of a material fact or omit
to state a material fact necessary to make the statement therein, in light of
the circumstances under which they were made, not misleading.
2.2 SUSPENSION PERIOD. Upon receipt of a notice under clauses (ii)
through (v) of Section 2.1(d), each Holder will forthwith discontinue
disposition of the Shares pursuant to the Registration Statement until the
Holder's receipt of the copies of the supplemented or amended Prospectus
contemplated by Section 2.1(d) or until the Holder is advised in writing by the
Company that the use of the Prospectus may be resumed and has received copies of
any additional or supplemental filings which are incorporated by reference in
the Prospectus, and, if so directed by the Company, the Holder will deliver to
the Company (at the Company's expense) all copies, other than permanent file
copies then in the Holder's possession, of the Prospectus covering the Shares
current at the time of receipt of such notice; provided, however, that in no
event will the period of suspension of disposition of the Shares under this
Section 2.2 exceed 90 days.
2.3 REGISTRATION EXPENSES. The Company will bear all expenses incurred
in connection with the registration of the Shares pursuant to this Section 2,
including without limitation all printing, legal and accounting expenses
incurred by the Company and all registration and filing fees imposed by the
Commission, any state securities commission or the Nasdaq Stock Market or, if
the common stock of the Company is not then listed on such market, the principal
national securities exchange or national market system on which the common stock
is then traded or quoted. Each Holder will be responsible for any brokerage
commissions and taxes of any kind (including, without limitation, transfer
taxes) with respect to any disposition, sale or transfer of the Holder's Shares
and for any legal, accounting and other expenses incurred by the Holder.
2.4 INDEMNIFICATION.
(a) INDEMNIFICATION BY THE COMPANY. The Company agrees to indemnify and
hold harmless, to the full extent permitted by law, each Holder, its partners,
officers, directors, trustees, stockholders, employees and agents, and each
person who controls such Holder within the meaning of either Section 15 of the
Securities Act or Section 20 of the Securities Exchange Act of 1934 (the
"Exchange Act"), or is under common control with, or is controlled by, such
Holders, together with the partners, officers, directors, trustees,
stockholders, employees and agents of such controlling person (collectively, the
"Controlling Persons"), from and against all losses, claims, damages,
liabilities and expenses, including without limitation reasonable legal fees and
expenses (collectively, the "Damages"), incurred by such Holder and any such
Controlling Person arising out of or based upon any untrue or alleged untrue
statement of material fact contained in the Registration Statement (or any
amendment thereto), or any omission or alleged omission to state therein a
material fact necessary to make the statements
- 4 -
<PAGE> 5
therein in light of the circumstances under which they were made not misleading,
or any untrue statement or alleged untrue statement of a material fact contained
in any Prospectus (as amended or supplemented if the Company shall have
furnished any amendments or supplements thereto), or any omission or alleged
omission to state therein a material fact necessary to make the statements
therein in light of the circumstances under which they were made not misleading,
except insofar as such Damages arise out of or are based upon any such untrue
statement or omission based upon information relating to such Holder furnished
in writing to the Company by such Holder specifically for use therein; provided,
however, that the Company shall not be liable to any Holder under this Section
2.4(a) to the extent that any such Damages were caused by the fact that such
Holder sold the Shares to a person as to whom it shall be established that there
was not sent or given, at or prior to the written confirmation of such sale, a
copy of the Prospectus as then amended or supplemented if, and only if (i) the
Company has previously furnished copies of such amended or supplemented
Prospectus to such Holder and (ii) such Damages were caused by any untrue
statement or omission or alleged untrue statement or omission contained in the
Prospectus so delivered which was corrected in such amended or supplemented
Prospectus.
(b) INDEMNIFICATION BY THE HOLDERS. Each Holder agrees, severally and
not jointly, to indemnify and hold harmless the Company, its directors, officers
and each person, if any, who controls the Company within the meaning of either
Section 15 of the Securities Act or Section 20 of the Exchange Act to the same
extent as the foregoing indemnity from the Company to such Holder, but only with
reference to information relating to such Holder furnished in writing to the
Company by such Holder specifically for use in the Registration Statement (or
any amendment thereto) or any Prospectus (or any amendment or supplement
thereto); provided, however, that such selling Holder shall not be obligated to
provide such indemnity to the extent that such Damages result from the failure
of the Company to promptly amend or take action to correct or supplement the
Registration Statement or Prospectus on the basis of corrected or supplemental
information provided by such Holder to the Company expressly for such purpose.
In no event shall the liability of any Holder of the Shares hereunder be greater
in amount than the amount of the proceeds received by such Holder upon the sale
of the Shares giving rise to such indemnification obligation.
(c) PROCEDURE. Each party entitled to indemnification under this
Section 2.4 (the "Indemnified Party") shall give prompt notice of any claim as
to which indemnification may be sought to the party required to provide
indemnification (the "Indemnifying Party"), provided that failure to give such
notice shall not relieve the Indemnifying Party of its obligations hereunder
except to the extent of actual prejudice. The Indemnifying Party shall be
entitled to assume the defense of any such claim with counsel reasonably
satisfactory to the Indemnified Party. The Indemnified Party may participate in
such defense at its own expense, provided that the Indemnifying Party will pay
such expense if representation of the Indemnified Party by the counsel retained
by the Indemnifying Party would be inappropriate due to actual or potential
differing interests between the Indemnified Party and any other party
represented by such counsel in such proceeding. No Indemnifying Party shall,
except with the consent of the Indemnified Party, agree to any settlement that
does not include a release of the Indemnified Party from all liability in
respect of such claim, and the Indemnified Party shall not settle such claim
without the prior written consent of the Indemnifying Party.
- 5 -
<PAGE> 6
2.5 RESTRICTIONS ON SALE. In the event of an underwritten public
offering for the account of the Company, upon the written request of the
managing underwriter or underwriters of such offering, each Holder agrees not to
effect any public sale or distribution of any securities similar to those being
registered in such offering, including without limitation, through sales of the
Shares pursuant to the Registration Statement, during the 21 days prior to, and
during the 90- day period beginning on, the effective date of the Registration
Statement relating to such offering. In the event of the delivery of such a
request, the right of a Holder to sell under the Registration Statement and the
obligations of the Company to keep the Registration Statement current shall be
suspended for the period specified in the preceding sentence.
2.6 CERTAIN DEFINITIONS. As used in this Section 2, the following terms
have the following meanings:
(a) "PROSPECTUS" means the prospectus included in any Registration
Statement (including, without limitation, a prospectus that discloses
information previously omitted from a prospectus filed as part of an effective
registration statement in reliance upon Rule 430A under the Securities Act), as
amended or supplemented by any prospectus supplement, and by all other
amendments and supplements to the prospectus, including post-effective
amendments, and in each case including all material incorporated by reference or
deemed to be incorporated by reference in such prospectus.
(b) "REGISTRATION STATEMENT" means any registration statement of the
Company that covers any of the Shares pursuant to the provisions of this
Agreement and all amendments and supplements to any such registration statement,
including post-effective amendments, in each case including the Prospectus, all
exhibits, and all material incorporated by reference or deemed to be
incorporated by reference in such registration statement.
SECTION 3 - MISCELLANEOUS
3.1 AMENDMENT AND WAIVER. This Agreement may not be amended, modified
or supplemented or any requirement hereunder waived, except in writing signed by
the party to bound thereby.
3.2 NOTICES. All notices and other communications provided for or
permitted hereunder shall be in writing and shall be deemed to have been duly
given if delivered personally or sent by telecopier, registered or certified
mail (return receipt requested), postage prepaid or courier to the parties at
their respective addresses set forth on the signature pages hereof (or at such
other address for any party as shall be specified by like notice, provided that
notices of a change of address shall be effective only upon receipt thereof).
All such notices and communications shall be deemed to have been received at the
time delivered by hand, if personally delivered; five business days after being
deposited in the mail, postage prepaid, if mailed; when receipt is acknowledged,
if telecopied; and on the next business day if timely delivered to a courier
guaranteeing overnight delivery.
3.3 SUCCESSORS AND ASSIGNS. This Agreement shall inure to the benefit
of and be binding upon the successors, assigns, heirs and legal representatives
of the parties. This Agreement may not be assigned by any Holder and any
attempted assignment shall be void and
- 6 -
<PAGE> 7
of no effect and shall terminate all obligations of the Company hereunder with
respect to such Holder.
3.4 COUNTERPARTS. This Agreement may be executed in any number of
counterparts and by the parties hereto in separate counterparts, each of which
when so executed shall be deemed to be an original and all of which taken
together shall constitute the same agreement.
3.5 HEADINGS. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.
3.6 GOVERNING LAW. This Agreement shall be governed by the laws of
Massachusetts without regard to principles of conflicts of law.
[Remainder of Page Intentionally Left Blank]
- 7 -
<PAGE> 8
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed as of the date stated above.
GALILEO CORPORATION
By: /s/ William T. Hanley, President
----------------------------------
William T. Hanley, President
Address: Galileo Park, P.O. Box 550
Sturbridge, MA 01566
HOLDERS:
/s/ John F. Blais, Jr.
----------------------------------
John F. Blais, Jr.
Address:
-----------------------------
/s/ James F. Briggs
----------------------------------
James F. Briggs
Address:
-----------------------------
/s/ Robert Clark
----------------------------------
Robert Clark
Address:
-----------------------------
/s/ John Lucy
----------------------------------
John Lucy
Address:
-----------------------------
/s/ Kris Anderson
----------------------------------
Kris Anderson
Address:
-----------------------------
- 8 -
<PAGE> 1
EXHIBIT C
---------
STANDSTILL AGREEMENT
This Agreement dated as of January 30, 1998 is between Galileo
Corporation (the "Company"), a Delaware corporation, and John F. Blais, Jr.
("Blais"). It is made as a condition precedent to consummation of the merger
(the "Merger") of OFC Corporation ("OFC") into a subsidiary of the Company
pursuant to the Agreement and Plan of Merger dated as of December 30, 1997.
Blais was the controlling stockholder of OFC and will receive shares of Common
Stock of the Company (the "Shares") in the Merger.
The parties hereto agree as follows:
1. COVENANTS OF BLAIS. Blais agrees that for a period of five
years from the date hereof, he will not, directly or indirectly, without the
prior written consent of the Company:
(a) acquire beneficial ownership of any securities of the
Company entitled ordinarily to vote in the election of directors of the Company
or any securities convertible into or exchangeable for such securities
(collectively, "Voting Stock"), except by way of stock dividends or other
distributions or offerings made available to holders of Voting Stock generally;
authorize, announce or make a tender, exchange or other offer that would result
in such an acquisition; or engage in any solicitation of proxies (within the
meaning of the federal securities laws) for the purpose of obtaining stockholder
approval for any transaction that would result in such an acquisition;
(b) deposit any shares of Voting Stock in a voting trust or
subject any Voting Stock to any arrangement or agreement with respect to the
voting thereof;
(c) join or otherwise act in concert with any third party, or
become a member of a group, for the purpose of acquiring, holding or disposing
of Voting Stock; or
(d) sell or otherwise transfer to any third party any Shares
that would represent at the time of such transfer (together with all prior sales
to such party or any affiliate or associate of such party) more than one percent
of the Company's then issued and outstanding Common Stock, except for sales made
in the public market in accordance with Rule 144 or pursuant to a registration
statement filed by the Company under the Securities Act of 1933, as amended.
Notwithstanding the foregoing, Blais may transfer Shares to his spouse or any
descendant or any trust for their benefit, provided that any such transferee
shall hold the Shares subject to the terms of this Agreement and the Shares
transferred shall be aggregated with all Shares held by Blais for this purpose.
2. NOTICE OF PURCHASES. Without limiting the restrictions in
Section 1, Blais will notify the Company of his acquisition of any shares of
Voting Stock, or rights thereto, within two days after such acquisition,
regardless of whether such transaction is otherwise required to be reported
under law. Such notice shall be made by telecopy and U.S. mail in accordance
with Section 4.
<PAGE> 2
3. LEGEND. Each certificate representing Shares held by Blais,
and any permitted transferee thereof subject to the terms of this Agreement,
shall bear the following legend:
The shares represented by this certificate are subject to a
Standstill Agreement dated January 30, 1998, which may be
obtained upon written request from the Secretary of the
Issuer.
4. NOTICES. All notices and other communications required or
permitted hereunder shall be effective upon receipt and shall be in writing and
may be delivered in person, by telecopy, express delivery service or U.S. mail
sent first-class, certified or registered, postage prepaid, addressed to the
party to be notified, at the respective addresses set forth below, or at such
other address for a party as it may specify by notice to the other party:
Galileo Corporation
Galileo Park, P.O. Box 550
Sturbridge, MA 01566
Fax: (508) 347-2270
Attention: President
with a copy to:
David R. Pokross, Jr., Esq.
Palmer & Dodge LLP
One Beacon Street
Boston, MA 02108
Fax: (617) 227-4420
John F. Blais, Jr.
362 Singletary Lane
Framingham, MA 01702
with a copy to:
Andrew L. Nichols, Esq.
Choate, Hall & Stewart
Exchange Place
53 State Street
Boston, MA 02109
Fax: (617) 248-4000
- 2 -
<PAGE> 3
5. MISCELLANEOUS.
(a) AMENDMENT AND WAIVER. This Agreement may not be amended,
modified or supplemented and no requirement hereunder may be waived, except in
writing signed by the party to be bound thereby.
(b) SUCCESSORS AND ASSIGNS. This Agreement shall inure to the
benefit of and be binding upon the successors, assigns, heirs and legal
representatives of the parties.
(c) COUNTERPARTS. This Agreement may be executed in any number
of counterparts and by the parties hereto in separate counterparts, each of
which when so executed shall be deemed to be an original and all of which taken
together shall constitute the same agreement.
(d) HEADINGS. The headings in this Agreement are for
convenience of reference only and shall not limit or otherwise affect the
meaning hereof.
(e) GOVERNING LAW. This Agreement shall be governed by the
laws of Massachusetts without regard to principles of conflicts of law.
IN WITNESS WHEREOF, the parties have executed this Agreement as an
instrument under seal as of the date stated above.
GALILEO CORPORATION
By: /s/ William T. Hanley, President
----------------------------------------
William T. Hanley, President
/s/ John F. Blais, Jr.
--------------------------------------------
JOHN F. BLAIS, JR.
- 3 -
<PAGE> 1
EXHIBIT D
---------
ESCROW AGREEMENT
This Escrow Agreement dated January 30, 1998 is among Galileo
Corporation (the "Buyer"), a Delaware corporation, John F. Blais, Jr., as the
representative of the shareholders and the optionholders (the "Shareholder
Representative") of OFC Corporation (the "Seller"), a New Hampshire corporation,
and State Street Bank and Trust Company, as escrow agent (the "Escrow Agent").
PRELIMINARY STATEMENT
Pursuant to an Agreement and Plan of Merger dated as of December 30,
1997 (the "Merger Agreement") between the Buyer and the Seller, the Buyer is
acquiring the Seller through the merger of the Seller into a subsidiary of the
Buyer (the "Merger"). Capitalized terms used herein and not otherwise defined
have the meanings assigned to them in the Merger Agreement.
Pursuant to Section 1.10 of the Merger Agreement, 115,426 shares of
Buyer Common Stock (the "Escrow Shares") and cash in the amount of $300,000 (the
"Escrow Cash Deposit") are being deposited by the shareholders and optionholders
(the "Shareholders") of the Seller hereunder to provide indemnification of the
Buyer under Section 10 of the Merger Agreement. The Escrow Cash Deposit and all
investments thereof and earnings thereon and any distributions on the Escrow
Shares are referred to hereafter as the "Escrow Cash." The Escrow Shares and the
Escrow Cash are referred to hereafter as the "Escrow Fund." A list of all
Shareholders, their interests in the Escrow Shares and the Escrow Cash, and
their pro rata interests in the Escrow Shares, the Escrow Cash and the Escrow
Fund is attached hereto as Schedule I.
The parties hereto agree as follows:
1. ESTABLISHMENT OF ESCROW; PAYMENT.
(a) The Buyer has delivered to the Escrow Agent and the Escrow
Agent acknowledges receipt of the Escrow Shares in the form of a single stock
certificate and the Escrow Cash by wire transfer. The Escrow Fund shall be held
in escrow in the name of the Escrow Agent or its nominee, subject to the terms
and conditions set forth herein. Unless and until the Escrow Shares are returned
to the Buyer or distributed to the Shareholder Representative pursuant to the
terms of this Agreement, the Escrow Agent shall vote the Escrow Shares in
accordance with the written instructions of the Shareholder Representative.
(b) The payment of any amount from the Escrow Fund by the
Escrow Agent hereunder, including the allocation of a portion of the Escrow Fund
to a Set Aside Amount under Section 4(a), shall be made first from any Escrow
Cash then available and then by transfer of Escrow Shares valued at $12.129 per
share (the "Agreed Share Value"). Any distributions of Escrow Shares to the
Shareholders shall be in kind.
2. INVESTMENT; TAX MATTERS. Cash held in the Escrow Fund may be
invested at the written direction of the Shareholder Representative by the
Escrow Agent in money market
<PAGE> 2
mutual funds invested primarily in securities issued or guaranteed by the United
States or any agency of the United States or an interest bearing demand deposit
account at the Escrow Agent. Investments pursuant to such investment
instructions described above shall in all instances be subject to availability
(including any time-of-day requirements). In no instance shall the Escrow Agent
have any obligation to provide investment advice of any kind. The Escrow Agent
shall be authorized at all times and from time to time to liquidate any
investment of the Escrow Fund as may be necessary to provide available cash to
make any release, disbursement or payment called for under the terms of this
Agreement. The Escrow Agent shall have no responsibility or liability for any
losses resulting from liquidation of the Escrow Fund (such as liquidation prior
to maturity). All amounts earned on the Escrow Fund, including any distributions
on the Escrow Shares, shall be held as part of the Escrow Fund. The parties
agree that to the extent permitted by applicable law, all amounts earned on the
Escrow Fund shall be allocated to the Shareholders in accordance with their pro
rata interests as set forth on Schedule I, and the Shareholders will include
such amounts in their gross income for federal, state and local income tax
(collectively, "income tax") purposes and pay any income tax resulting
therefrom. The Shareholders shall furnish to the Escrow Agent all information
necessary to enable it to comply with the reporting and backup withholding
requirements of the Internal Revenue Code of 1986, as amended, including a
completed Form W-8 or W-9, as applicable.
3. CLAIMS AGAINST ESCROW FUND.
(a) At any time or times prior to the Expiration Date (as
defined below), the Buyer may make claims against the Escrow Fund for amounts
due for indemnification under Section 10 of the Merger Agreement. The Buyer
shall notify the Shareholder Representative and the Escrow Agent in writing of
each such claim, including a brief description of the amount and nature of such
claim. Each such notice delivered to the Escrow Agent by the Buyer shall contain
a representation of the Buyer to the effect that the Buyer has delivered a copy
of such notice to the Shareholder Representative prior to or simultaneously with
its delivery to the Escrow Agent. In the event that the amount subject to the
claim is unliquidated, the Buyer shall make a good faith estimate as to the
amount of the claim for purposes of determining the portion of the Escrow Fund
to be withheld by the Escrow Agent if such claim is not resolved or otherwise
adjudicated by the Expiration Date. If the Shareholder Representative disputes
such claim, the Shareholder Representative shall give written notice thereof to
the Buyer and to the Escrow Agent within thirty days after the date the Buyer's
notice of claim was delivered to the Shareholder Representative, in which case
the Escrow Agent shall continue to hold the Escrow Fund in accordance with the
terms of this Agreement; otherwise, such claim shall be deemed to have been
acknowledged to be payable from the Escrow Fund in the full amount thereof as
set forth in the claim and the Escrow Agent shall pay such claim to the Buyer as
soon as practicable after expiration of that thirty-day period. If the amount of
the claim exceeds the aggregate value of the Escrow Fund, the Escrow Agent shall
have no liability or responsibility for any deficiency. All claims paid out of
the Escrow Shares shall be rounded to the nearest whole share. Under no
circumstances shall the Shareholders or the Shareholder Representative have any
right to substitute other property for the Escrow Shares or to change the Agreed
Share Value.
(b) If the Shareholder Representative gives notice to the
Buyer and the Escrow Agent pursuant to Section 3(a) disputing a Buyer claim, no
payment from the Escrow Fund shall be made by the Escrow Agent to the Buyer or
to the Shareholders of the Set Aside Amount under Section 4(a) with respect to
such claim until either (i) such disputed claim has
- 2 -
<PAGE> 3
been resolved as evidenced by a written notice executed by the Buyer and the
Shareholder Representative instructing the Escrow Agent as to the distribution
of such Set Aside Amount or portion thereof or (ii) such dispute shall have been
adjudicated in accordance with the arbitration procedures described in Section
4(b).
4. DISPUTED CLAIMS.
(a) If the Shareholder Representative disputes an
indemnification claim of the Buyer as above provided and subject to Section 3,
the Escrow Agent shall allocate a portion of the Escrow Fund equal to the amount
of the claim as set forth in the notice of the claim (the "Set Aside Amount").
In the event the Buyer notifies the Escrow Agent in writing that it has made
out-of-pocket expenditures or anticipates that it will incur legal expenses in
connection with any such disputed claim with respect to which it is entitled to
be indemnified under the Merger Agreement, a portion of the Escrow Fund equal to
such incurred or anticipated expenditures shall also be added to and become a
part of the Set Aside Amount, provided that in the event that it shall be agreed
(as evidenced by a written notice executed by the Buyer and the Shareholder
Representative as described in Section 3(b)) or determined through an
arbitration proceeding described in Section 4(b) that the Buyer is not entitled
to indemnification with respect to such claim, the Buyer shall not be entitled
to such additional portion, and such additional portion shall be released from
the Set Aside Amount.
(b) If the Escrow Agent does not receive written notice
executed by the Buyer and the Shareholder Representative within sixty days after
the Shareholder Representative sends notice of such dispute to the effect that
the disputed indemnification claim has been resolved (or at such earlier time as
the Buyer and Shareholder Representative may agree), the indemnification claim
shall be referred by the Buyer and the Shareholder Representative to an
arbitrator chosen by agreement of the Shareholder Representative and the Buyer.
If no agreement is reached regarding selection of the arbitrator within thirty
days after written request from either party to the other, the Buyer or the
Shareholder Representative may submit the matter in dispute to the American
Arbitration Association, to be settled by arbitration in Boston, Massachusetts
in accordance with the commercial arbitration rules of the Association. The
Buyer and the Shareholder Representative agree to act in good faith to mutually
select an arbitrator. The fees and expenses of any arbitration shall be borne by
the Escrow Fund and the Buyer in such proportions as shall be determined by the
arbitrator, or if there is no such determination, then such fees and expenses
shall be borne equally by the Escrow Fund and the Buyer. The determination of
the arbitrator as to the amount, if any, of the indemnification claim that is
properly allowable shall be conclusive and binding upon the parties hereto and
judgment may be entered thereon in any court having jurisdiction. The Escrow
Agent shall make payment of such claim to the Buyer out of the Set Aside Amount
and make payment of the fees and expenses of the arbitration out of the Escrow
Fund, in each case as and to the extent allowed as soon as practicable following
its receipt of a copy of the arbitration award determination.
5. PARTIAL RELEASE; TERMINATION.
(a) On the date that is three months after the date of this
Agreement or as soon as practicable thereafter, the Escrow Agent shall
distribute to the Shareholder Representative for distribution to the
Shareholders all Escrow Cash then held in the Escrow Fund except to the
- 3 -
<PAGE> 4
extent that such Escrow Cash has been, or is then required to be, allocated to a
Set Aside Amount.
(b) This Agreement shall terminate six months after the date
hereof (the "Expiration Date"), provided that there are no outstanding
indemnification claims as to which the Escrow Agent has received notice pursuant
to Section 3 on or prior to the Expiration Date; otherwise this Agreement shall
continue in effect until the resolution of all such indemnification claims. On
the Expiration Date or as soon thereafter as is practicable, the Escrow Agent
shall distribute to the Shareholder Representative for distribution to the
Shareholders the Escrow Fund less (i) the amount of any then existing Set Aside
Amounts and (ii) the amount specified in any notice of a claim delivered to the
Escrow Agent on or prior to the Expiration Date with respect to which no Set
Aside Amount has yet been established and the Escrow Agent has not otherwise
been instructed by the Buyer and the Shareholder Representative. At such time
thereafter as any remaining indemnification claim hereunder has been resolved
and the Escrow Agent has received a written notice executed by the Buyer and the
Shareholder Representative to that effect (or a copy of an arbitration award
pursuant to Section 4(b) to that effect) and any amounts to be distributed to
the Buyer in connection therewith have been so distributed, the Escrow Agent
shall deliver the remaining Escrow Shares to the Buyer's transfer agent for
distribution to the Shareholders in accordance with instructions from the
Shareholder Representative and this Agreement shall terminate. The Buyer shall
not be required to issue certificates for fractional shares in any distribution
of Escrow Shares pursuant to this Agreement, but rather shall pay to the
Shareholder Representative for distribution to the Shareholders an amount in
cash (without interest) determined by multiplying each Shareholder's fractional
interest by the Agreed Share Value.
6. THE ESCROW AGENT.
(a) Notwithstanding anything herein to the contrary, the
Escrow Agent shall promptly dispose of all or any part of the Escrow Shares as
directed by a writing jointly signed by the Shareholder Representative and the
Buyer. The reasonable fees and expenses of the Escrow Agent in connection with
its execution and performance of this Agreement as set forth on Schedule II
hereto shall be borne by the Buyer. The Escrow Agent shall not be liable for any
act or failure to act under this Agreement, including any and all claims made
against the Escrow Agent as a result of its holding the Escrow Shares in its own
name, except for its own gross negligence or willful misconduct. The Escrow
Agent shall not be liable for, and the Buyer shall indemnify and hold harmless
the Escrow Agent and its directors, employees, officers, agents, successors and
assigns against, any losses or claims (including reasonable out-of-pocket
expenses) arising out of any action taken or omitted in good faith hereunder and
reasonable costs of investigation and counsel fees and expenses which may be
imposed on the Escrow Agent or reasonably incurred by it in connection with its
acceptance of this appointment or performance of its duties hereunder. The
Escrow Agent may decline to act and shall not be liable for failure to act if in
doubt as to its duties under this Agreement. The Escrow Agent may act upon any
instrument or signature believed by it to be genuine and may assume that any
person purporting to give any notice or instruction hereunder, reasonably
believed by it to be authorized, has been duly authorized to do so. The Escrow
Agent's duties shall be determined only with reference to this Agreement and
applicable law and the Escrow Agent is not charged with knowledge of or
- 4 -
<PAGE> 5
any duties or responsibilities in connection with any other document or
agreement, including without limitation, the Merger Agreement.
(b) The Escrow Agent shall have the right at any time to
resign hereunder by giving written notice of its resignation to the parties
hereto, at the addresses set forth herein or at such other address as the
parties shall provide, at least thirty days prior to the date specified for such
resignation to take effect. In such event the Buyer shall with the approval of
the Shareholder Representative, which approval shall not be unreasonably
withheld, appoint a successor escrow agent within that thirty-day period; if the
Buyer does not designate a successor escrow agent within such period, the Escrow
Agent may appoint a successor escrow agent. Upon the effective date of such
resignation, the Escrow Fund then held by the Escrow Agent hereunder shall be
delivered by it to such successor escrow agent or as otherwise shall be
designated in writing by the Buyer and the Shareholder Representative.
(c) In the event that the Escrow Agent should at any time be
confronted with inconsistent or conflicting claims or demands by the other
parties hereto, the Escrow Agent shall have the right to interplead the parties
in any court of competent jurisdiction and request that such court determine the
respective rights of the parties with respect to this Agreement and, upon doing
so, the Escrow Agent shall be released from any obligations or liability to the
other parties as a consequence of any such claims or demands.
(d) The Escrow Agent may execute any of its powers or
responsibilities hereunder and exercise any rights hereunder, either directly or
by or through its agents or attorneys. Nothing in this Agreement shall be deemed
to impose upon the Escrow Agent any duty to qualify to do business or to act as
fiduciary or otherwise in any jurisdiction other than The Commonwealth of
Massachusetts. The Escrow Agent shall not be responsible for and shall not be
under a duty to examine, inquire into or pass upon the validity, binding effect,
execution or sufficiency of this Agreement or of any amendment or supplement
hereto.
(e) Neither the Escrow Agent nor any of its directors,
officers or employees shall be liable to anyone for any error of judgment, or
for any act done or step taken or omitted to be taken by it or any of its
directors, officers or employees, or for any mistake of fact or law, or for
anything which it, or any of its directors, officers or employees, may do or
refrain from doing in connection with or in the administration of this
Agreement, unless and except to the extent the same constitutes gross negligence
or willful misconduct on the part of the Escrow Agent. In no event shall the
Escrow Agent be liable for any indirect, punitive, special or consequential
damages, or any amount of in excess of the value of the Escrow Fund (as of the
date of the action or omission giving rise to liability).
(f) The Escrow Agent may consult with, and obtain advice from,
legal counsel (including, without limitation, in-house counsel) with respect to
any question as to any of the provisions hereof or its duties hereunder, or any
matter relating hereto, and the opinion of such counsel shall be full and
complete authorization and protection in respect of any action taken, suffered
or omitted by the Escrow Agent in good faith in accordance with the opinion and
directions of such counsel.
(g) The Escrow Agent shall not be deemed to have notice of any
fact, claim or demand with respect hereto unless actually known by an officer
charged with responsibility for
- 5 -
<PAGE> 6
administering this Agreement or unless in writing received by the Escrow Agent
and making specific reference to this Agreement.
(h) No provision of this Agreement shall require the Escrow
Agent to expend or risk its own funds, or to take any legal or other action
hereunder which might in its judgment involve it in, or require it to incur in
connection with the performance of its duties hereunder, any expense or any
financial liability unless it shall be furnished with indemnification acceptable
to it.
(i) Any permissive right of the Escrow Agent to take any
action hereunder shall not be construed as duty.
(j) All indemnifications contained in this Agreement shall
survive the resignation or removal of the Escrow Agent, and shall survive the
termination of this Agreement.
(k) The Escrow Agent is not responsible for the recitals
appearing in this Agreement. The recitals shall be deemed to be statements of
the Buyer and the Shareholders.
(l) The Escrow Agent has no responsibility for the sufficiency
of this Agreement for any purpose. Without limiting the foregoing, if any
security interest is referred to herein, the Escrow Agent shall have no
responsibility for, and makes no representation or warranty as to, the creation,
attachment or perfection of any such security interest or the sufficiency of
this Agreement therefor.
(m) Nothing in this Agreement shall obligate the Escrow Agent
to qualify to do business or act in any jurisdiction in which it is not
presently qualified to do business, or be deemed to impose upon the Escrow Agent
the duties of a trustee. The duties of the Escrow Agent under this Agreement are
strictly ministerial in nature.
(n) In no event shall the Escrow Agent have any liability for
any failure or inability of any of other party to perform or observe its duties
under the Agreement, or by reason of a breach of this Agreement by any other
party. In no event shall the Escrow Agent be obligated to take any action
against any other party to compel performance hereunder.
(o) The Escrow Agent shall in no instance be obligated to
commence, prosecute or defend any legal proceedings in connection herewith.
(p) Whenever the terms hereof call for any notice, payment or
other action on a day which is not a business day, such payment or action may be
taken, or such notice given, as the case may be, on the next succeeding business
day. As used herein, "business day" shall mean any day other than a Saturday or
Sunday, or any other day on which the Escrow Agent is closed for business.
(q) In the event of any ambiguity or uncertainty under this
Agreement, or in any notice, instruction, or other communication received by the
Escrow Agent hereunder, the Escrow Agent may, in its discretion, refrain from
taking action, and may retain the Escrow Fund,
- 6 -
<PAGE> 7
until and unless it receives written instruction signed by all Interested
Parties which eliminates such uncertainty or ambiguity.
(r) If at any time Escrow Agent is served with any judicial or
administrative order, judgment, decree, writ or other form of judicial
administrative process which in any way relates to or affects the Escrow Fund
(including but not limited to orders of attachment or garnishment or other forms
of levies or injunctions or stays relating to the Escrow Fund), Escrow Agent is
authorized to comply therewith in any manner as it or its legal counsel deems
appropriate; and if the Escrow Agent complies with any such judicial or
administrative order, judgment, decree, writ or other form of judicial or
administrative process, Escrow Agent shall not be liable to any of the parties
hereto or to any other person or entity notwithstanding that though such order,
judgment, decree, writ or process may be subsequently modified, annulled, set
aside, vacated, found to have been without proper jurisdiction, or otherwise
determined to have been without legal force or effect.
7. SHAREHOLDER REPRESENTATIVE.
(a) In the event the Shareholder Representative shall die or
resign or otherwise terminate his status as such, his successor shall be Bernard
A. Moisan or such other person as the Shareholder Representative may appoint. If
the successor Shareholder Representative shall die or resign or otherwise
terminate his status as such, his successor shall be any person appointed by
such successor Shareholder Representative or, in the case of his failure to
appoint a successor after a vacancy has been created, elected by the vote or
written consent of a majority in interest of the Shareholders. All decisions of
the Shareholder Representative shall be binding upon the Shareholders. The
Shareholder Representative shall keep the Shareholders reasonably informed of
his or her material decisions.
(b) The Shareholder Representative is authorized to take any
action deemed by him appropriate or necessary to carry out the provisions of,
and to determine the rights of the Shareholders under this Agreement. The
Shareholder Representative shall serve as the agent of the Shareholders for all
purposes related to this Agreement, including without limitation service of
process upon the Shareholders. By execution of this Agreement, the Shareholder
Representative accepts and agrees to diligently discharge the duties and
responsibilities of the Shareholder Representative set forth in this Agreement
without compensation for his services hereunder. The authorization and
designation of the Shareholder Representative under this Section 7(b) shall be
binding upon the successors and assigns of each Shareholder. The Buyer and the
Escrow Agent shall be entitled to rely upon such authorization and designation
and shall be fully protected in dealing with the Shareholder Representative, and
shall have no duty to inquire into the authority of any person reasonably
believed by any of them to be the Shareholder Representative.
(c) The Shareholder Representative (i) shall not be liable to
any of the Shareholders for any error of judgment, or action taken or omitted in
good faith, or mistake of fact or law unless caused by his own gross negligence
or willful misconduct, (ii) shall be entitled to treat as genuine any letter or
other document furnished to him by the Buyer, the Shareholders or the Escrow
Agent and believed by him to be genuine and to have been signed and presented by
the proper party or parties and (iii) shall be reimbursed from any portions of
the Escrow Fund
- 7 -
<PAGE> 8
otherwise immediately deliverable to the Shareholders under the this Agreement
for counsel fees and other out-of-pocket expenses incurred by the Shareholder
Representative in connection with this Agreement.
8. GOVERNING LAW. This Agreement is governed by the laws of
Massachusetts without regard to its conflict of law provisions, and shall inure
to the benefit of and be binding upon the successors, assigns, heirs and
personal representatives of the parties hereto.
9. COUNTERPARTS. This Agreement may be executed in two or more
counterparts, all of which documents shall be considered one and the same
document.
10. NOTICES. Any notice or other communication required or permitted
hereunder shall be in writing and shall be deemed given when delivered in
person, by overnight courier, by facsimile transmission (with receipt confirmed
by telephone or by automatic transmission report) or two business days after
being sent by registered or certified mail (postage prepaid, return receipt
requested), as follows:
TO THE BUYER:
Galileo Corporation
Galileo Park, P.O. Box 550
Sturbridge, MA 01566
Fax: (508) 347-2270
Attn: William T. Hanley, President
With copies to:
David R. Pokross, Jr., Esq.
Palmer & Dodge LLP
One Beacon Street
Boston, MA 02108
Fax: (617) 227-4420
TO THE SHAREHOLDER REPRESENTATIVE:
John F. Blais, Jr.
OFC Corporation
2 Mercer Road
Natick, MA 01760
Fax: (508) 653-0729
With copies to:
Andrew L. Nichols, Esq.
Choate, Hall & Stewart
Exchange Place
53 State Street
- 8 -
<PAGE> 9
Boston, MA 02109
Fax: (617) 248-4000
TO ESCROW AGENT:
State Street Bank and Trust Company
Corporate Trust Department - 5th Floor
Two International Place
Boston, MA 02110
Attention: Galileo - OFC Acquisition Escrow
Tel. (617) 664-5588
Fax: (617) 664-5365
Any party may by notice given in accordance with this section to the other
parties designate another address or person for receipt of notices hereunder.
11. FORCE MAJEURE.
The Escrow Agent shall not be responsible or liable for delays
or failures in performance resulting from acts beyond its control. Such acts
shall include but not be limited to acts of God, strikes, lockouts, riots, acts
of war, epidemics, laws or governmental regulations changed or superimposed
after the fact, fire, communication line failures, power failures, computer
viruses, earthquakes or other disasters, or to unavailability of Federal Reserve
Bank wire or telex facilities.
[Remainder of Page Intentionally Left Blank]
- 9 -
<PAGE> 10
IN WITNESS WHEREOF, the parties hereto have executed this Agreement
under seal as of the date first stated above.
GALILEO CORPORATION
By /s/ William T. Hanley, President
-----------------------------------------
William T. Hanley, President
SHAREHOLDER REPRESENTATIVE
/s/ John F. Blais, Jr.
--------------------------------------------
John F. Blais, Jr.
STATE STREET BANK AND TRUST COMPANY,
as Escrow Agent
By
-----------------------------------------
Title:
- 10 -
