0000902664-13-001913.txt : 20130416 0000902664-13-001913.hdr.sgml : 20130416 20130415215300 ACCESSION NUMBER: 0000902664-13-001913 CONFORMED SUBMISSION TYPE: SC 13D/A PUBLIC DOCUMENT COUNT: 2 FILED AS OF DATE: 20130416 DATE AS OF CHANGE: 20130415 GROUP MEMBERS: DANIEL G. KEANE DESCENDANTS TRUST GROUP MEMBERS: KEVIN T. KEANE GROUP MEMBERS: LESLIE R. KEANE FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: KEANE DANIEL G CENTRAL INDEX KEY: 0001182855 FILING VALUES: FORM TYPE: SC 13D/A MAIL ADDRESS: STREET 1: 1801 ELMWOOD AVE CITY: BUFFALO STATE: NY ZIP: 14207 SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: MOD PAC CORP CENTRAL INDEX KEY: 0001191857 STANDARD INDUSTRIAL CLASSIFICATION: PAPERBOARD CONTAINERS & BOXES [2650] IRS NUMBER: 160957153 STATE OF INCORPORATION: NY FILING VALUES: FORM TYPE: SC 13D/A SEC ACT: 1934 Act SEC FILE NUMBER: 005-78992 FILM NUMBER: 13762515 BUSINESS ADDRESS: STREET 1: 1801 ELMWOOD AVE. CITY: BUFFALO STATE: NY ZIP: 14207-2496 BUSINESS PHONE: 716-873-0640 MAIL ADDRESS: STREET 1: 1801 ELMWOOD AVENUE CITY: BUFFALO STATE: NY ZIP: 14207 SC 13D/A 1 p13-1066sc13da.htm MOD-PAC CORP.

 

SECURITIES AND EXCHANGE COMMISSION  
Washington, D.C. 20549  
   
SCHEDULE 13D/A
 
Under the Securities Exchange Act of 1934
(Amendment No. 4)*
 

Mod-Pac Corp.

(Name of Issuer)
 
Common Stock, $0.01 par value

Class B Common Stock, $0.01 par value

(Title of Class of Securities)
 
607495108

607495207

(CUSIP Number)
 
Daniel G. Keane
1801 Elmwood Avenue
Buffalo, New York 14207

(716) 873-0640

(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
 

April 11, 2013

(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 that is the subject of this Schedule 13D, and is filing this schedule because of Rule 13d-1(e), Rule 13d-1(f) or Rule 13d-1(g), check the following box. [ ]

 

(Page 1 of 10 Pages)

______________________________

* 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).

 
CUSIP No. 607495108 and 607495207SCHEDULE 13D/APage 2 of 10 Pages

 

1

NAME OF REPORTING PERSON

Daniel G. Keane

2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP

(a) ¨

(b) ý

3 SEC USE ONLY
4

SOURCE OF FUNDS

PF/OO (See Item 3)

5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDING IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) ¨
6

CITIZENSHIP OR PLACE OF ORGANIZATION

United States

NUMBER OF
SHARES
BENEFICIALLY
OWNED BY
EACH
REPORTING
PERSON WITH:
7

SOLE VOTING POWER

280,321 shares of Common Stock1

201,237 shares of Class B Common Stock

8

SHARED VOTING POWER

0

9

SOLE DISPOSITIVE POWER

280,321 shares of Common Stock1

201,237 shares of Class B Common Stock

10

SHARED DISPOSITIVE POWER

0


11

AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH PERSON

280,321 shares of Common Stock1

201,237 shares of Class B Common Stock

12 CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES ¨
13

PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)

9.4% of the outstanding shares of Common Stock

35.8% of the outstanding shares of Class B Common Stock

26.6% of the aggregate voting power of the outstanding shares of Common Stock and Class B Common Stock

13.6% of the economic interest of the outstanding shares of Common Stock and Class B Common Stock

14

TYPE OF REPORTING PERSON

IN

       

1 Includes 223,400 shares of Common Stock issuable upon exercise of options and 25,000 shares of Common Stock held in a custodial account for the benefit of the Reporting Person's children for which Daniel G. Keane serves as the sole custodian.

  

 
CUSIP No. 607495108 and 607495207SCHEDULE 13D/APage 3 of 10 Pages

 

1

NAME OF REPORTING PERSON

Daniel G. Keane Descendants Trust

2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP

(a) ¨

(b) ý

3 SEC USE ONLY
4

SOURCE OF FUNDS

OO (See Item 3)

5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDING IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) ¨
6

CITIZENSHIP OR PLACE OF ORGANIZATION

State of New York

NUMBER OF
SHARES
BENEFICIALLY
OWNED BY
EACH
REPORTING
PERSON WITH:
7

SOLE VOTING POWER

0

8

SHARED VOTING POWER

406,905 shares of Common Stock

9

SOLE DISPOSITIVE POWER

0

10

SHARED DISPOSITIVE POWER

406,905 shares of Common Stock


11

AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH PERSON

406,905 shares of Common Stock

12 CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES ¨
13

PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)

14.8% of the outstanding shares of Common Stock

4.9% of the aggregate voting power of the outstanding shares of Common Stock and Class B Common Stock

12.3% of the economic interest of the outstanding shares of Common Stock and Class B Common Stock

14

TYPE OF REPORTING PERSON

OO

       
 
CUSIP No. 607495108 and 607495207SCHEDULE 13D/APage 4 of 10 Pages

 

1

NAME OF REPORTING PERSON

Leslie R. Keane

2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP

(a) ¨

(b) ý

3 SEC USE ONLY
4

SOURCE OF FUNDS

PF/OO (See Item 3)

5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDING IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) ¨
6

CITIZENSHIP OR PLACE OF ORGANIZATION

United States

NUMBER OF
SHARES
BENEFICIALLY
OWNED BY
EACH
REPORTING
PERSON WITH:
7

SOLE VOTING POWER

16,997 shares of Common Stock

14,995 shares of Class B Common Stock

8

SHARED VOTING POWER

406,905 shares of Common Stock2

9

SOLE DISPOSITIVE POWER

16,997 shares of Common Stock

14,995 shares of Class B Common Stock

10

SHARED DISPOSITIVE POWER

406,905 shares of Common Stock2


11

AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH PERSON

423,902 shares of Common Stock2

14,995 shares of Class B Common Stock

12 CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES ¨
13

PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)

15.4% of the outstanding shares of Common Stock

2.7% of the outstanding shares of Class B Common Stock

6.8% of the aggregate voting power of the outstanding shares of Common Stock and Class B Common Stock

13.2% of the economic interest of the outstanding shares of Common Stock and Class B Common Stock

14

TYPE OF REPORTING PERSON

IN

       

2 Includes 406,905 shares of Common Stock held in trust by the Daniel G. Keane Descendants Trust.

 
CUSIP No. 607495108 and 607495207SCHEDULE 13D/APage 5 of 10 Pages

 

1

NAME OF REPORTING PERSON

Kevin T. Keane

2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP

(a) ¨

(b) ý

3 SEC USE ONLY
4

SOURCE OF FUNDS

PF/OO (See Item 3)

5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDING IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) ¨
6

CITIZENSHIP OR PLACE OF ORGANIZATION

United States

NUMBER OF
SHARES
BENEFICIALLY
OWNED BY
EACH
REPORTING
PERSON WITH:
7

SOLE VOTING POWER

99,189 shares of Common Stock3

75,649 shares of Class B Common Stock4

8

SHARED VOTING POWER

0

9

SOLE DISPOSITIVE POWER

99,189 shares of Common Stock3

75,649 shares of Class B Common Stock4

10

SHARED DISPOSITIVE POWER

0

11

AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH PERSON

99,189 shares of Common Stock3

75,649 shares of Class B Common Stock4

12 CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES ¨
13

PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)

3.5% of the outstanding shares of Common Stock

13.4% of the outstanding shares of Class B Common Stock

10.1% of the aggregate voting power of the outstanding shares of Common Stock and Class B Common Stock

5.3% of the economic interest of the outstanding shares of Common Stock and Class B Common Stock

14

TYPE OF REPORTING PERSON

IN

       

3 Includes 64,750 shares of Common Stock issuable upon exercise of options and 29,439 shares of Common Stock owned by, or held in trust for the benefit of, the Reporting Person's wife.

4 Includes 12,413 shares of Class B Common Stock owned by, or held in trust for the benefit of, the Reporting Person's wife.

 
CUSIP No. 607495108 and 607495207SCHEDULE 13D/APage 6 of 10 Pages

This Amendment No. 4 amends the statement on Schedule 13D filed by certain of the Reporting Persons on October 26, 2012 (the "Original Schedule 13D"), as amended by Amendment No. 1 filed by certain of the Reporting Persons on October 29, 2012, Amendment No. 2 filed by the Reporting Persons on December 17, 2012 and Amendment No. 3 filed by the Reporting Persons on January 17, 2013 (the Original Schedule 13D, as amended, the "Schedule 13D") relating to the (i) shares of common stock, par value $0.01 per share (the "Common Stock"), of Mod-Pac Corp., a New York corporation (the "Issuer") and (ii) shares of class B common stock, par value $0.01 per share (the "Class B Common Stock"), of the Issuer. This Amendment No. 4 amends Items 3, 4, 5, 6 and 7 as set forth below.

 

Item 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION
   
  Item 3 of the Schedule 13D is hereby supplemented as follows:
   
  It is anticipated that the funding (excluding expenses) required for the transactions contemplated by the Merger Agreement (as defined in Item 4 below) as further described in Item 4 below (the "Transaction") will be approximately $22.2 million.
   
  Mandan Acquisition Corp., a New York corporation ("Merger Sub") and wholly owned subsidiary of Parent (as defined below) has entered into a commitment letter, dated April 8, 2013, with M&T Bank (the "Debt Commitment Letter") providing that, upon the terms and conditions specified therein, M&T Bank will provide up to $22 million of the required funding for the Transaction through a combination of a $6 million revolving credit facility and a $16 million term loan facility. Additional funding required for the Transaction has been or will be funded by certain Family Shareholders, Parent or Family Corp. (each as defined below). This summary of the Debt Commitment Letter does not purport to be complete and is qualified in its entirety by the Debt Commitment Letter attached hereto as Exhibit 12 and incorporated herein by reference.
   
  In addition, on April 11, 2013, the Reporting Persons, Elizabeth R. Keane (the wife of Mr. K. Keane), individually and as Co-Trustee under the Irrevocable Lifetime Trust Agreement dated as of October 15, 1997, and Kevin R. Keane (the brother of Mr. D. Keane and the son of Mr. K. Keane) as Co-Trustee under the Irrevocable Lifetime Trust Agreement dated as of October 15, 1997 (collectively, the "Family Shareholders") entered into a Rollover Agreement (the "Rollover Agreement") with LeCaron Enterprises Corp., a Delaware corporation ("Family Corp."). Pursuant to the Rollover Agreement, the Family Shareholders will, subject to the terms and conditions contained therein, immediately prior to the effective time of the Merger, (i) convert all of the Class B Common Stock owned by them into the Company's Common Stock on a one-to-one basis in accordance with the Issuer's Certificate of Incorporation and (ii) then contribute, assign, transfer, convey and deliver all of the shares of the Company’s Common Stock (including those shares issued upon conversion of the Company’s Class B Common Stock) then owned by such parties (collectively, the "Rolled Shares") to Family Corp. in exchange for all of the equity interests in Family Corp. (the "Rollover"). On April 11, 2013, Family Corp. entered into a Contribution Agreement (the "Contribution Agreement") with Rosalia Capital LLC, a Delaware limited liability company and a wholly owned subsidiary of Family Corp. ("Parent"), pursuant to which Family Corp. will, subject to the terms and conditions contained therein, contribute the Rolled Shares to Parent in exchange for equity interests in Parent immediately after the consummation of the Rollover, but prior to the effective time of the Merger. The Rolled Shares are
   
   
 
CUSIP No. 607495108 and 607495207SCHEDULE 13D/APage 7 of 10 Pages

 

valued at approximately $7,392,120 (based on the $8.40 per share merger consideration described in Item 4). The Issuer is not a party to the Rollover Agreement or the Contribution Agreement. The Rollover Agreement and the Contribution Agreement are filed as Exhibits 13 and 14 hereto, respectively, and are each incorporated by reference into this Item 3. The foregoing description of the Rollover Agreement and Contribution Agreement does not purport to be complete, and is qualified in its entirety by reference to the full text thereof.

 

Item 4. PURPOSE OF TRANSACTION
   
  Item 4 of the Schedule 13D is hereby supplemented as follows:
   
  On April 11, 2013, the Issuer published a press release announcing that it entered into an Agreement and Plan of Merger, dated as of April 11, 2013 (the "Merger Agreement"), with Parent and Merger Sub. At the effective time of the Merger (as defined below), each issued and outstanding share of the Issuer (other than shares owned by the Parent and Merger Sub (which will include at the effective time all the shares held by the Family Shareholders) and dissenting shares of the Company's Class B Common Stock) will be converted into the right to receive $8.40 per share, in cash and Merger Sub will merge with and into the Issuer, with the Issuer surviving the merger as a wholly owned subsidiary of Parent (the "Merger"). The Merger Agreement is filed as Exhibit 15 hereto and incorporated by reference into this Item 4. The foregoing description of the Merger Agreement does not purport to be complete, and is qualified in its entirety by reference to the full text thereof.
   
  In connection with the execution of the Merger Agreement, the Family Shareholders entered into the Rollover Agreement described in Item 3 above. Pursuant to the Rollover Agreement, the Family Shareholders will, subject to the terms and conditions contained therein, immediately prior to the effective time of the Merger, contribute the Rolled Shares to Family Corp. in exchange for equity interests in Family Corp. The Family Shareholders also entered into the Contribution Agreement described in Item 3 above pursuant to which Family Corp. will, subject to the terms and conditions contained therein, contribute the Rolled Shares to Parent in exchange for equity interests in Parent immediately after the consummation of the Rollover, but prior to the effective time of the Merger. The Rollover Agreement and the Contribution Agreement are filed as Exhibits 13 and 14 hereto, respectively, and incorporated by reference into this Item 4. The foregoing description of the Rollover Agreement and Contribution Agreement does not purport to be complete, and is qualified in its entirety by reference to the full text thereof.
   
  Shareholders of the Company will be asked to vote on the adoption of the Merger Agreement and the approval of the Merger at a special shareholders meeting called for such purpose that will be held on a date to be announced.  The Merger Agreement provides, amount other things, that the closing of the Merger is subject to a non-waiveable condition that an affirmative vote of a majority of the votes cast at such meeting, other than those issued and outstanding shares of the Company's Common Stock or Class B Common Stock beneficially owned by the Family Shareholders, adopt the Merger Agreement and approve the Merger.

 

 
CUSIP No. 607495108 and 607495207SCHEDULE 13D/APage 8 of 10 Pages

 

  Also in connection with the execution of the Merger Agreement, (i) the Family Shareholders, Parent and Family Corp. entered into a Voting Agreement, dated as of April 11, 2013 (the "Voting Agreement"), pursuant to which each Family Shareholder, Family Corp. and Parent agreed, subject to the terms and conditions set forth therein, to vote the outstanding Common Stock and Class B Common Stock over which they have voting power (representing in the aggregate approximately 41.0% of the Company's total outstanding voting power as of the date hereof) in favor of the adoption of the Merger Agreement and the approval of the Merger and (ii) Mr. D. Keane executed a limited guarantee in favor of the Issuer, dated April 11, 2013 (the "Limited Guarantee"), pursuant to which he guaranteed to the Company, subject to the terms and conditions set forth therein, the obligation of Parent under the Merger Agreement to reimburse, under certain circumstances, the Issuer’s transaction expenses up to a maximum amount of $500,000.
   
  The Voting Agreement and Limited Guarantee are filed as Exhibits 16 and 17 hereto respectively, and are incorporated by reference into this Item 4. The foregoing descriptions of the Voting Agreement and Limited Guarantee do not purport to be complete, and are qualified in their entirety by reference to the full text thereof.
   
  The purpose of the Transaction is to acquire all of the outstanding capital stock of the Issuer (other than the Rollover Shares). If the Transaction is consummated, the Common Stock of the Issuer will be delisted from The NASDAQ Global Market and the Common Stock and Class B Common Stock will cease to be registered under the Act and the Issuer will be privately held by Parent.
   
Item 5. INTEREST IN SECURITIES OF THE ISSUER
   
  Item 5 of the Schedule 13D is hereby amended and restated as follows:
   
(a) See rows (11) and (13) of the cover pages to this Schedule 13D for the aggregate number of shares of Common Stock and Class B Common Stock and percentages of the Common Stock and Class B Common Stock beneficially owned by each of the Reporting Persons.  The percentages reported in this Schedule 13D are calculated based upon the 2,753,826 shares of Common Stock and the 562,770 shares of Class B Common Stock outstanding as of April 3, 2013, as represented by the Issuer in the Merger Agreement.
   
(b) See rows (7) through (10) of the cover pages to this Schedule 13D for the number of shares of Common Stock and Class B Common Stock as to which each Reporting Person has the sole or shared power to vote or direct the vote and sole or shared power to dispose or to direct the disposition.
   
(c) The Reporting Persons have not effected any transaction in the Issuer's stock during the past sixty days.
   
(d) No person is known by the Reporting Persons to have the right to receive or the power to direct the receipt of dividends from, or the proceeds from the sale of, any shares of Common Stock or Class B Common Stock beneficially owned by the Reporting Persons.
   
(e) Not applicable.

 

 
CUSIP No. 607495108 and 607495207SCHEDULE 13D/APage 9 of 10 Pages

 

Item 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT TO SECURITIES OF THE ISSUER
   
  Item 6 of the Schedule 13D  is hereby supplemented as follows:
   
  See the discussion in Item 4 regarding the Rollover Agreement, the Contribution Agreement, the Merger Agreement, the Voting Agreement and the Limited Guarantee. Such descriptions of the Rollover Agreement, the Contribution Agreement, the Merger Agreement, the Voting Agreement and the Limited Guarantee do not purport to be complete, and are qualified in their entirety by reference to the full text of the Rollover Agreement, the Contribution Agreement, the Merger Agreement, the Voting Agreement and the Limited Guarantee, which are filed as Exhibits 13, 14, 15, 16 and 17 respectively, and incorporated by reference into this Item 6.
   
Item 7. MATERIAL TO BE FILED AS EXHIBITS
   
  Item 7 of the Schedule 13D is hereby supplemented as follows:
   
  Exhibit 12: Debt Commitment Letter, dated April 8, 2013, by and between Merger Sub and M&T Bank (incorporated by reference to Exhibit 10.1 of the Current Report on Form 8-K/A filed by the Issuer on April 15, 2013).
   
  Exhibit 13:  Rollover Agreement, dated as of April 11, 2013, by and among Family Corp. and the Family Shareholders (incorporated by reference to Exhibit 10.2 of the Current Report on Form 8-K/A filed by the Issuer on April 15, 2013).
   
  Exhibit 14:  Contribution Agreement, dated as of April 11, 2013, by and between Family Corp. and Parent.
   
  Exhibit 15:  Merger Agreement, dated as of April 11, 2013, by and among Parent, Merger Sub and the Issuer (incorporated by reference to Exhibit 2.1 of the Current Report on Form 8-K/A filed by the Issuer on April 15, 2013).
   
  Exhibit 16:  Voting Agreement, dated as of April 11, 2013, by and among the Issuer, Family Corp. Parent and the Family Shareholders (incorporated by reference to Exhibit 10.4 of the Current Report on Form 8-K/A filed by the Issuer on April 15, 2013).
   
  Exhibit 17:  Limited Guarantee, dated as of April 11, 2013 by Mr. D. Keane (incorporated by reference to Exhibit 10.3 of the Current Report on Form 8-K/A filed by the Issuer on April 15, 2013).

 

 
CUSIP No. 607495108 and 607495207SCHEDULE 13D/APage 10 of 10 Pages

SIGNATURES

After reasonable inquiry and to the best of his knowledge and belief, each of the undersigned certifies that the information set forth in this statement is true, complete and correct.

Date: April 15, 2013

 

     
/s/ Daniel G. Keane    
DANIEL G. KEANE    
     
     
     
     
DANIEL G. KEANE DESCENDANTS TRUST    
     
/s/ Leslie R. Keane    
Name: Leslie R. Keane    
Title: Trustee    
     
     
     
     
/s/ Leslie R. Keane    
LESLIE R. KEANE    
     
     
     
/s/ Kevin T. Keane    
KEVIN T. KEANE    
     
     

 

 

EX-99 2 p13-1066exhibit14.htm P13-1066EXHIBIT14

 

CONTRIBUTION AGREEMENT

This Contribution Agreement (this “Agreement”) is made and entered into as of April 11, 2013, by and between LeCaron Enterprises Corp., a Delaware corporation ("Family Corp."), and Rosalia Capital LLC, a Delaware limited liability company and wholly-owned subsidiary of Family Corp. ("Rosalia").

WHEREAS, concurrently with the execution and delivery of this Agreement, Rosalia, Mandan Acquisition Corp., a New York corporation and wholly owned subsidiary of Rosalia (“Merger Sub”), and Mod-Pac Corp., a New York corporation ("Mod-Pac") are entering into an Agreement and Plan of Merger (as amended, supplemented or otherwise modified from time to time, the “Merger Agreement”), which provides, among other things, for the merger of Merger Sub with and into Mod-Pac, with Mod-Pac surviving as a wholly-owned subsidiary of Parent (the “Merger”);

WHEREAS, concurrently with the execution and delivery of this Agreement, Family Corp. is entering into a Rollover Agreement, dated as of the date of this Agreement (as amended, supplemented or otherwise modified from time to time, the "Rollover Agreement"), with certain shareholders of Mod-Pac (the "Family Shareholders"), providing for the Family Shareholders' contribution, immediately prior to the Effective Time (after giving effect to the conversion of all of their shares of Class B Stock of Mod-Pac into shares of Common Stock of Mod-Pac (in each case as defined in the Merger Agreement)), of all of their shares of Mod-Pac's Common Stock (the "Rollover Shares") to Family Corp. in exchange for their receipt of newly issued shares of Family Corp.'s capital stock (the "Rollover"); and

WHEREAS, subject to the conditions set forth herein, immediately after the consummation of the Rollover, but prior to the Effective Time, Family Corp. and Rosalia desire that Family Corp. contribute all of the Rollover Shares to the capital of Rosalia;

NOW, THEREFORE, in consideration of the foregoing and the agreements set forth below, the parties hereto agree as follows: 

1.                  Contribution. At the Closing, Family Corp. will contribute, assign, transfer, convey and deliver all of the Rollover Shares to the capital of Rosalia.

2.                  Closing.

(a)                The closing of the transactions contemplated by Section 1 (the “Closing”) will take place immediately after the occurrence of the Rollover Closing, but prior to the Effective Time, at the offices of Hodgson Russ LLP at the Guaranty Building, 140 Pearl Street, Suite 100, Buffalo, New York 14202 or otherwise, if agreed by all of the parties hereto.

(b)               At the Closing, Family Corp. will deliver (i) in the case of the Rollover Shares held in "street name" (if any), ownership of such Rollover Shares to a brokerage account established in the name of Rosalia in accordance with customary practices for the transfer of shares held in such manner, and (y) in the case of the remainder of the Rollover Shares, to Rosalia the original stock certificates representing all of such Rollover Shares, duly endorsed by Family Corp. in blank (or accompanied by stock powers duly executed by Family Corp. in blank form).

3.                  Further Assurances.  Each party to this Agreement shall execute such documents and other papers and take such further actions as may be reasonably required or desirable to carry out the provisions hereof and the transactions contemplated hereby.

4.                  Termination.  This Agreement shall terminate upon the termination of the Merger Agreement in accordance with its terms.

5.                  Notices.  All notices and other communications hereunder shall be in writing and shall be deemed to have been duly given if delivered personally or sent by telecopy, overnight courier service or by registered or certified mail (postage prepaid, return receipt requested), to the respective parties at the following addresses or at such addresses as shall be specified by the parties by like notice:  

(i)         If to Family Corp.:

LeCaron Enterprises Corp.
P. O. Box 754
Buffalo, New York 14207-0754
Attention:  Daniel G. Keane

            with a copy to (which shall not constitute notice):

Schulte Roth & Zabel LLP
919 Third Avenue
New York, New York 10022
Telecopier:  (212) 935-9935
Attention:  Peter J. Halasz

(ii)        If to Rosalia:

Rosalia Capital LLC
c/o LeCaron Enterprises Corp.
P. O. Box 754
Buffalo, New York 14207-0754
Attention:  Daniel G. Keane

            with a copy to (which shall not constitute notice):

Schulte Roth & Zabel LLP
919 Third Avenue
New York, New York 10022
Telecopier:  (212) 935-9935
Attention:  Peter J. Halasz

6.                  Entire Agreement.  This Agreement (including the documents and instruments referred to herein) constitutes the entire agreement and supersedes all other prior agreements and understandings, both written and oral, between the parties hereto with respect to the subject matter hereof.

7.                  Amendment.  This Agreement may not be modified, amended, altered or supplemented except by written agreement of each of the parties hereto.

2
 

 8.                  Binding Effect; Benefits. This Agreement will be binding upon the parties hereto and their respective successors and permitted assigns.  Nothing in this Agreement, express or implied, is intended or will be construed to give any person other than the parties to this Agreement and their respective successors and permitted assigns any legal or equitable right, remedy or claim under or in respect of any agreement or any provision contained herein.

9.                  Successors and Assigns.  Neither this Agreement nor any right, remedy, obligation or liability arising hereunder or by reason hereof will be assignable by Family Corp. without the prior written consent of Rosalia.

10.              Counterparts.  This Agreement may be executed by facsimile and in two or more counterparts, each of which shall be deemed to be an original, but all of which together shall constitute one and the same instrument.

11.              Governing Law; Jurisdiction. This Agreement shall be governed by and construed in accordance with the Laws of the State of New York, regardless of the Laws that might otherwise govern under applicable principles of conflicts of laws thereof, except to the extent that mandatory provisions of federal law apply.  Each of the parties hereto hereby irrevocably and unconditionally submits, for itself and its property, to the exclusive jurisdiction of the courts of the State of New York and any appellate court thereof and the United States District Court for the Western District of New York and any appellate court thereof, in any action or proceeding arising out of or relating to this Agreement or the agreements delivered in connection herewith or the transactions contemplated hereby or thereby or for recognition or enforcement of any judgment relating thereto, and each of the parties hereby irrevocably and unconditionally (i) agrees not to commence any such action except in such courts, (ii) agrees that any claim in respect of any such action or proceeding may be heard and determined in such courts, (ii) waives, to the fullest extent it may legally and effectively do so any objection which it may now or hereafter have to venue of any such action or proceeding in any such courts, and (iv) waives, to the fullest extent permitted by Law, the defense of any inconvenient forum to the maintenance of such action or proceeding in any such courts.  Each of the parties hereto agrees that a final judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by Law.  To the extent permitted by law, each party hereby irrevocably agrees that any suit, action or other proceeding brought by it against any other party hereto shall be brought, heard and determined solely in such courts.  Each of the parties to this Agreement irrevocably consents to service of process in any such action or proceeding in the manner provided for notices in Section 5 of this Agreement; provided, however, that nothing in this Agreement shall affect the right of any party to this Agreement to serve process in any other manner permitted by Law.

12.                Waiver of Jury Trial.  EACH PARTY ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY THAT MAY ARISE UNDER THIS AGREEMENT IS LIKELY TO INVOLVE COMPLICATED AND DIFFICULT ISSUES, AND THEREFORE IT HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT AND ANY OF THE AGREEMENTS DELIVERED IN CONNECTION HEREWITH OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.  EACH PARTY CERTIFIES AND ACKNOWLEDGES THAT (A) NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE SUCH WAIVER, (B) IT UNDERSTANDS AND HAS CONSIDERED THE IMPLICATIONS OF SUCH WAIVER, (C) IT MAKES SUCH WAIVER VOLUNTARILY, AND (D) IT HAS BEEN INDUCED TO ENTER THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVER AND CERTIFICATIONS CONTAINED IN THIS SECTION.

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 13.              Severability.  Any term or provision of this Agreement which is invalid or unenforceable in any jurisdiction shall, as to that jurisdiction, be ineffective to the extent of such invalidity or unenforceability without rendering invalid or unenforceable the remaining terms and provisions of this Agreement or affecting the validity or enforceability of any terms or provisions of this Agreement in any other jurisdiction so long as the economic or legal substance of the transactions contemplated hereby is not affected in any manner adverse to any party.  Upon such determination that any term or other provision is invalid, illegal or incapable of being enforced, the parties shall negotiate in good faith to modify this Agreement so as to effect the original intent of the parties as closely as possible in an acceptable manner to the end that the transactions contemplated hereby are fulfilled to the fullest extent possible.

14.              Interpretation.  The subject headings of the Sections and subsections of this Agreement are included for the purposes of convenience only, and shall not affect the construction or interpretation of any of the provisions of this Agreement.  References in this Agreement to Sections are to the Sections to this Agreement, unless the context requires otherwise.  Unless the context of this Agreement otherwise requires, (i) words using the singular or plural number also include the plural or singular number, respectively; (ii) the terms “hereof,” “herein,” “hereby” and derivative or similar words refer to this entire Agreement; and (iii) the word “or” shall be disjunctive but not exclusive unless the context clearly prohibits that construction.

15.              Effectiveness. The obligations of the parties under this Agreement shall not be effective or binding upon the parties until such time as this Agreement is executed and delivered by all of the parties specified herein as parties hereto.

16.              Definitions.  Unless otherwise indicated herein, capitalized terms used herein and not otherwise defined herein shall have the meanings ascribed them in the Merger Agreement.

[Signatures on the following page]

 

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IN WITNESS WHEREOF, the parties hereto have executed this Contribution Agreement as of the date first above written.

 

                LECARON ENTERPRISES CORP.
               

 

 

                By:

/s/ Daniel G. Keane 

                  Daniel G. Keane
                  President and Chief Executive Officer
                   
                   
                ROSALIA CAPITAL LLC
               

 

 

                By:

/s/ Daniel G. Keane 

                  Daniel G. Keane
                  President and Chief Executive Officer

 

 

 

 

 

 

 

 

 

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