Exhibit 10.1

 

 

SALE AGREEMENT

 

 

RELATING TO PGA ELECTRONIC

 

 

4 November 2013

 

 

 

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SALE AGREEMENT

SUBJECT TO CONDITIONS PRECEDENT

BETWEEN THE UNDERSIGNED:

 

1. Mr Jean-François PIAULET, born on 2 December 1952 in Châteauroux (36),
residing at 28, Rue Romain Rolland – 36130 Déols.

 

2. Mr Daniel PIAULET, born on 17 May 1947 in Déols (36), residing at 304 Avenue
De La Châtre – 36000 Châteauroux.

 

3. Mr Pascal MOULIN, born on 18 June 1962 in Châteauroux (36), residing at 3,
Route de Lizeray – 36100 Saint Valentin.

 

4. Mr Laurent GROUSSIN, born on 23 June 1962 in Valençay (36), residing at 6,
Allée du Bois Doré—36330 Le Poinçonnet.

Referred to collectively as the “Transferors” or individually as a “Transferor”,

ON THE ONE HAND,

AND:

 

5. Astronics Corporation, a company incorporated under the United States laws,
whose registered office is at 130 Commerce Way – East Aurora, NY—14052-2191, USA
and represented by Mr. David Burney,

Hereinafter the “Transferee”

ON THE OTHER HAND,

The Transferors and the Transferee are referred to collectively as the “Parties”
and individually as a “Party”.

PREAMBLE:

 

A. PGA ELECTRONIC s.a. is a public limited company with a board of directors
with a share capital of 1,000,000 Euros, whose registered office is at Avenue
Jean Monnet Z.I. la Malterie 36130 MONTIERCHAUME, registered on Châteauroux
Corporate & Trade Register under number 350 534 939 (the “Company” or “PGA”).
The Company is an aeronautical equipment manufacturer in the field of motion,
lighting and IFEC/CMS systems dedicated to the cabin (the “Activity of the
Company”).

 

B. The Company share capital is divided into five thousand six hundred
(5,600) shares (referred to hereinafter together as the “Shares” or individually
as a “Share”) allocated as indicated in Schedule B. The Transferors own directly
100% less two Shares of the share capital and voting rights of the Company on a
fully diluted basis.

 

C. The Transferors have instituted a competitive sale process. In the context of
this process and following a certain number of exchanges, the Transferee made a
declaration of interest. The Transferee is a leading provider of advanced
technologies for the global aerospace and defense industries and, as such, is a
professional of the same sector of activity of the Company (the “Activity of the
Transferee”, collectively with the Activity of the Company, the “Activities”).

 

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D. Prior to signing the Contract, the Transferee and its advisors have had
access to a physical data room containing information and documents (the “Data
Room”), listed in Schedule D hereto, have had meetings with main managers of the
Company, and visited the site. They have obtained written responses to the
questions asked in the context of their due diligence (the “Q&A”), have had
access to the premises of PGA and have had discussions and meetings with the
accounting and financial department of PGA. The Data Room and the Q&A have been
copied onto a series of CD-Rom of which (x) one copy has been provided to the
Transferee, (y) one copy has been retained by the Transferors’ Agent, and
(z) one copy has been delivered jointly by the Transferors’ Agent and the
Transferee to the notarial office of Mr. Michelez, located at 128 boulevard de
Courcelles – Paris (17ème).

 

E. In the context of the purchase offer selection process, the Transferee set
out in a letter dated 5 June 2013 (as modified in an email dated 3 July 2013 and
by the letter granting exclusivity of negotiation dated 3 July 2013) the terms
of its final offer for its purchase of the Transferors’ Shares in accordance
with the terms and conditions stated therein.

 

F. Prior to signature of this Contract, the Company’s works council was informed
and consulted on 4 November 2013 about the project to sell control of the
Company.

 

G. In these circumstances, the Transferors plan to sell all of their Shares. The
Transferee approached the Transferors with a view to concluding the purchase of
all the Shares of the Company owned by the Transferors at the date hereof and to
be owned by the Transferors at the Completion Date and which represent, and
shall represent at the Completion Date, 100% less the Minority Shareholders
Shares of the share capital and of the voting rights of the Company on a fully
diluted basis (the “Transferred Shares”). At the end of the above-mentioned
procedures, the Parties agreed to commit in accordance with the terms and
conditions of this contract, in particular the conditions precedent, featured
below (the “Contract”).

PURSUANT TO THE PREAMBLE, TERMS OF AGREEMENT ARE AS FOLLOWS

Introductory article—Definitions

For the purposes of this Contract, terms starting with a capital letter, whether
in the plural or singular, shall have the meaning stated below.

 

“Accounting Principles”

meaning defined in the Guarantee agreement.

 

“Actual Net Debt”

means the actual Net Debt at the latest day of the month prior to the Completion
Date as agreed between the Transferors’ Agent and the Transferee or determined
by the Independent Expert, as per the Final Closing Statement of Debt defined in
accordance with article 2.2.

 

“AstStocks”

meaning indicated in article 2.1 (c) (ii).

 

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“Company”

meaning indicated in paragraph (A) of the preamble.

 

“Completion Date”

means the date on which the transfer of full ownership of the Transferred Shares
will be completed in accordance with article 5.

 

“Conditions precedent”

means the conditions precedent mentioned in article 3.1.

 

“Contract”

means this contract, including its preamble and schedules thereto.

 

“Data Room”

meaning indicated in paragraph (D) of the preamble.

 

“Estimated Net Debt”

meaning the Net Debt by close of business on the latest day of the month prior
to the Completion Date as estimated by the Transferee.

 

“Governmental Authority”

meaning defined in the Guarantee agreement.

 

“Guarantee agreement”

meaning indicated in article 5.3.

 

“Net Debt”

meaning assigned to such term in Schedule E.

 

“Party”

meaning defined at the beginning of this Contract.

 

“Payment Stocks”

meaning indicated in article 2.1 (c) (ii).

 

“Price”

meaning indicated in article 2.1.

 

“Reference Accounts”

meaning defined in the Guarantee agreement.

 

“Related Parties”

means in relation to a person, the person or entity in which this person,
directly or indirectly has an interest; “interest” means with respect to a
person (i) direct or indirect ownership of 5% or more of the share capital,
economic rights or voting securities of such person, and/or (ii) the right to
appoint, or cause the appointment of, any members of the board of directors (or
similar governing body), and/or (iii) the spouse, children and parents
(including brothers, sisters, ancestor or lineal descendants) of such person.

 

“Share”

meaning indicated in paragraph (B) of the preamble.

 

“Significant Contract”

means the following contracts, the “contracts” means any contract, agreement,
obligation, promise, commitment or other undertaking:

 

  •   each partnership, consortium or joint venture agreement or other contracts
of the same nature entered into by the Company;

 

  •   each contract or other instrument evidencing or pertaining to the lending
of money by the Company as well as each guarantee, indemnity, suretyship or
other contract pursuant to which the Company guarantees or otherwise provides
security for any obligation of any other person;

 

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  •   each contract providing for the sale of any assets by the Company other
than in the ordinary course of business or for the grant by Company of any
options or preferential rights to purchase any assets (other than inventory);

 

  •   each commitment or other contract with a governmental authority;

 

  •   each contract limiting or restraining the Company from engaging or
competing in any lines of business with any person or in any area or territory;

 

  •   each other contract involving expenditures or receipts by the Company in
excess of €100,000 for the purchases and €500,000 for the sales in the aggregate
(including for the avoidance of doubt any lease agreements, sale, purchase or
supply contracts).

 

“Taxes”

meaning defined in the Guarantee agreement.

 

“Third Party Rights”

means any security interest, easement, lien, surety, pledge, option,
restriction, preferential right, “usufruit” or other real or personal right
(droit réel ou personnel) or any other third party right whatsoever encumbering
directly or indirectly any Share or material assets or restricting any attribute
of ownership of, as well as any option (or other commitment to sell), right of
first refusal, pre-emption right, restriction on voting or receipt of income.

 

“Transferee”

meaning defined at the beginning of this Contract.

 

“Transferee Material Adverse Change” or “Transferee Material Adverse Effect”

means any event, fact, matter, change or occurrence, as the date of this
Contract, which, individually or in the aggregate with other such event, fact,
matter, change of occurrence, is or could reasonably be expected to be
materially adverse to the business, results, profits, financial condition,
assets, properties, liabilities, operations or prospects of Astronics
Corporation with an impact on the income from Operations of Astronics
Corporation which would be in excess of EUR 1,000,000.

 

“Transferor”

meaning defined at the beginning of this Contract.

 

“Transferors’ Agent”

means Mr Jean-François PIAULET, hereby appointed by the Transferors and who
accepts this appointment, as agent to give and receive all notices and other
documents, to give all consents, to receive service of process, to handle,
dispute, settle or otherwise deal with any and all claims against the Transferee
under this Contract, and more generally, to exercise the rights and fulfil all
obligations of the Transferors on their behalf under this Contract. Any decision
of the Transferors’ Agent shall bind the Transferors who shall be timely
informed of any of its action and specifically within five (5) days for any
matters relating to the payment of any portion of the Price to be received by
the Transferors.

 

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  The Transferors’ Agent may at any time notify the Transferee and the other
Transferors that it does not wish to continue to act as agent for all or part of
the Transferors, in which case the Transferors shall appoint a successor
Transferors’ Agent and provide the details thereof to the Transferee no later
than thirty (30) days after the delivery to the Transferee of such notice;
provided however, that any notice made by the Transferee shall be deemed
correctly made if made to the former Transferor’s Agent in accordance with
article 9 until such time as the Transferee shall have actually received the
notice with the details of the successor Transferors’ Agent.

 

“Transferor Material Adverse Change” or “Transferor Material Adverse Effect”

means any event, fact, matter, change or occurrence, as the date of this
Contract, which, individually or in the aggregate with other such event, fact,
matter, change of occurrence, is or could reasonably be expected to be
materially adverse to the business, results, profits, financial condition,
assets, properties, liabilities, operations or prospects of the Company with an
impact on the operating profit (résultat d’exploitation) of the Company which
would be in excess of EUR 250,000.

 

“Transferred Shares”

meaning indicated in paragraph (G) of the preamble.

 

“ValATRO”

meaning indicated in article 2.1 (c) (ii).

 

“Working Day”

means any day other than a Saturday, Sunday or legal holiday in Paris, France or
New York, U.S.A. or other day on which commercial banking institutions in Paris,
France or New York, U.S.A. are required to close.

The expressions « including », « to include » and « in particular » shall be
deemed to be followed by the terms « but not restricted to ». The expressions
« in this contract », « hereinafter » and similar expressions refer to this
Contract overall rather than a specific term thereof. Unless express mention to
the contrary in this Contract, all contracts, documents or regulations defined
or mentioned in this Contract refer to this Contract or document or this
regulation as amended, modified or supplemented, including by waiver or
agreement and, as far as all regulations are concerned, by a later regulation.

Article 1 - Purpose

 

1.1 Sale of the Transferred Shares

 

(a) The Transferors undertake to sell and deliver to the Transferee, and the
Transferee undertakes to purchase, on the Completion Date, in accordance with
the terms and conditions, in particular conditions precedent, of the Contract,
all but not less than all of the Transferred Shares, which shall represent 100%
less two Shares of the total number of issued and outstanding securities in the
Company.

It is understood that on Completion Date the Company will not have issued any
tradable securities granting direct or indirect access to its capital.

 

(b) On the Completion Date, the Transferred Shares shall be sold to the
Transferee by the Transferors, who shall be the owners, on said date, of the
Transferred Shares free from all pledge, pre-emptive right and any other Third
Party Rights whatsoever, in exchange for payment in full by the Transferee of
the Price of the Transferred Shares resulting from article 2 below.

 

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1.2 Ownership—Title

Upon the terms and subject to the conditions set forth in this Contract, the
Transferee shall become owner of the Transferred Shares together with all rights
and benefits now and thereafter attaching hereto and shall acquire full title
(pleine et entière propriété) thereof on the Completion Date. At such point in
time, the Transferee shall be purely and simply subrogated in the rights and
obligations of the Transferors attached to the Transferred Shares and shall be
entitled to receive all pay-outs of dividends and other distributions which may
occur as from the Completion Date and in respect of the current fiscal year. For
the avoidance of doubt, it is specified that since August 31, 2012, the Company
has paid to its current shareholders (including the Transferors) (i) a dividend
of an amount of EUR 201,600 which has been declared by the shareholders’ meeting
of the Company dated February 14, 2013 and paid on February 15, 2013 and (ii) a
dividend of an amount of EUR 2,000,040 which has been declared by the
shareholders’ meeting of the Company dated August 30, 2013 and paid on the same
date.

 

1.3 Substitution

Astronics Corporation shall be replaced for the purchase of the Transferred
Shares from the Transferors by a wholly-owned subsidiary to be incorporated in
France as a société par actions simplifiée. For such purpose, Astronics
Corporation will take all reasonable steps to have this French subsidiary duly
incorporated by November 29, 2013 at the latest. For the avoidance of doubt,
Astronics Corporation will remain jointly and severally liable with its
subsidiary thus substituted, for the perfect fulfilment by said subsidiary of
all of the Transferee’s obligations stipulated herein, in particular payment of
the Price. The Transferee’s obligations stipulated below shall then apply to the
subsidiary thus substituted as if it had been the original Contract signatory.
In any case and whoever is the third party thus substituted, the Payment Stocks
shall be ordinary shares of Astronics Corporation common stock, listed on NASDAQ
National Market System under the symbol “ATRO”.

 

1.4 Minority Shareholders

All Company minority shareholders mean shareholders other than the Transferors
identified in Schedule 1.4 (the “Minority Shareholders”). The two shares owned
by each Minority Shareholder are also featured in Schedule 1.4 (the “Minority
Shareholder Shares”).

Article 2 - Price - Payment

 

2.1 Sale price of the Transferred Shares

 

(a) Amount of the Price. The sale of the Transferred Shares shall take place in
exchange for payment by the Transferee of the total, all-inclusive, final price
of

 

  •   twenty-one million four hundred twenty-five thousand euros (EUR
21,425,000) (the “Enterprise Value “),

 

  •   minus, the amount of the Actual Net Debt, if such amount is positive,

 

  •   plus, the amount of the Actual Net Debt, if such amount is negative.

in each case as finally determined in accordance with article 2.1(e) and 2.2
(the “Price”).

 

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(b) Transferors’ Statement. No later than five (5) Working Days prior to the
Completion Date, the Transferors’ Agent (on behalf of the Transferors) shall
deliver to the Transferee a statement (the “Transferors’ Statement”) prepared in
good faith based upon the financial information available to the Transferors,
after due and careful inquiry, setting out:

 

  (i) an estimated amount of the Net Debt (the “Estimated Net Debt”) with
reasonably detailed information and calculations in respect thereof; and

 

  (ii) an amount (the “Estimated Price”), equal to:

 

  •   the Enterprise Value,

 

  •   minus, the Estimated Net Debt if such amount is positive,

 

  •   plus, the Estimated Net Debt if such amount is negative.

 

(c) Closing Payment. On the Completion Date, the Transferee shall pay the
Estimated Price as set out in the Transferors’ Statement as follows:

 

  (i) thirteen million euros (EUR 13,000,000) in cash by wire transfer to the
Transferors, according to the allocation set forth in Schedule B, to the
Transferors’ bank accounts designated by the Transferors’ Agent, at the latest
three (3) Working Days before the Completion Date, it being specified that an
amount of one million euros (EUR 1,000,0000) shall be retained by the Transferee
pending final determination of the Net Adjustment Amount pursuant to article 2.2
(the “Retained Portion of the Price”). The Retained Portion of the Price shall
be paid by the Transferee to the Transferors at the time and conditions set
forth in article 2.3 and, on the Completion Date, the Transferee shall provide a
first demand bank guarantee in order to secure the Transferors regarding the
payment of the Retained Portion of the Price, it being specified that such bank
guarantee shall be issued by a bank of first rank having a subsidiary or an
establishment in France and under terms and conditions usually used in France.;
and

 

  (ii) for the fraction of Estimated Price in excess of EUR 13,000,000 (the “Non
Cash Fraction of Estimated Price”), according to the allocation set forth in
Schedule B, by shares of Astronics Corporation common stock listed on the NASDAQ
National MarketSystem, under the symbol “ATRO” (hereinafter the “AstStocks”), it
being specified that the total number of AstStocks to be granted to the
Transferors as payment of the Non Cash Fraction of Estimated Price shall be
determined as follows (the “Payment Stocks”):

[Estimated Price – EUR 13,000,000] / [Average value in Euros of the stock quote
of 1 AstStock at closing of the Nasdaq Stock Market reduced by 5% for each
trading day over the last 30 trading days prior to the fifth trading day before
the Completion Date (the “ValATRO”)],

 

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it being specified that for the purpose of determining the ValATRO in Euro, the
average value in US Dollars of the stock quote of 1 AstStock at closing of the
Nasdaq Stock Market reduced by 5% for each trading day over the last 30 trading
days prior to the fifth trading day before the Completion Date shall be
converted in Euro on the basis of the average US Dollar / Euro conversion rate
over the last 30 trading days prior to the fifth trading day before the
Completion Date as published by the Bank of France (Banque de France). For the
avoidance of doubt, the payment of the Non Cash Fraction of Estimated Price in
shares of AstStocks in lieu of cash is being made for the convenience of the
Transferee and has been structured as a delivery of shares to be made as an
alternative mechanism of payment for the Transferred Shares. The delivery of the
Transferred Shares by the Transferors shall in no way constitute a payment in
kind (apport de titres).

As from the date hereof and until the Completion Date, in the event Astronics
Corporation performs prior to Closing any transaction or declaration of any
dividend or distribution, stock split, reverse stock split, stock dividend,
reorganization, reclassification, merger, combination, recapitalization, or
other like change or any other transaction with respect to or affecting the
financial rights attached to shares of AstStocks (i.e. for more than 1% of
financial impact) (an “AstStocks Dilution Event”), and including any stock
repurchase or redemption effected on a substantially pro rata basis or in which
the majority of Astronics Corporation’s stockholders participate, prior to the
Closing which materially affects the number of shares of Payment Stock the
Transferors should equitably receive, such number of shares of Payment Stock
shall be equitably adjusted to the extent necessary to provide the Transferors
the same economic effect as contemplated by this Contract prior to such
transaction or declaration.

The Transferee shall notify the Transferors’ Agent upon deciding or announcing
any AstStocks Dilution Event to be performed or decided no later than the
Completion Date. In case the Parties do not reach agreement on the necessary
equitable adjustment prior to the Completion Date, the matters in dispute shall
be referred to the Independent Expert mutatis mutandis according to the
provisions of Article 2.2 hereunder and Closing shall be extended to the
remittance of the Independent Expert final report solving this dispute.

For the avoidance of doubt, with respect to the stock distribution to be
distributed on October 24, 2013 in which each Astronics Corporation shareholder
received one share of Astronics Class B Stock for every five shares of Astronics
Common Stock and Class B Stock held by such shareholder on October 10, 2013, the
share price of AstStocks to be used to calculate the Payment Stocks for periods
up to the ex-dividend date for such stock distribution should be adjusted down
by 20% to reflect the dilution on the price of AstStocks attributable to such
stock distribution.

Notwithstanding the above, if, in application of the above formula, the number
of AstStocks to be delivered to any of the Transferors in accordance with the
allocation set forth in Schedule B, results in a fractional number, the number
of AstStocks to be delivered to such Transferor shall be rounded off in the
integer of number of AstStocks immediately lower and the remainder shall be paid
in cash to this Transferor by the Transferee on the Completion Date.

 

(d) Description of the Payment Stock mechanism

 

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Notwithstanding the provisions of article 2.1(c), if, as at Completion Date, the
number of AstStocks to be delivered to Mr. Jean-François Piaulet pursuant to
article 2.1(c) above would exceed 0.95% of the total number of issued securities
or voting rights of Astronics Corporation, the Transferee undertakes to reduce
the number of AstStocks to be delivered to Mr. Jean-François Piaulet to a number
of AstStocks which will not exceed 0.95% of the share capital or voting rights
of Astronics Corporation, the remainder being paid in cash by wire transfer to
Mr Jean-François Piaulet’s bank account on Completion Date by the Transferee.

As a result of the above, on the Completion Date, the Payment Stocks shall be
transferred as follows to the Transferors, according to the allocation set forth
in Schedule B.

 

(e) Post-Closing Adjustment. Subsequent to the Completion Date, the Estimated
Price shall be:

 

  (i) reduced, on a Euro for Euro basis, by the amount, if any, by which the
Actual Net Debt exceeds the Estimated Net Debt; or

 

  (ii) increased, on a Euro for Euro basis, by the amount, if any, by which the
Estimated Net Debt exceeds the Actual Net Debt.

 

2.2 Closing Financial Statements, Closing Statement of Debts; Computation of Net
Adjustment Amount.

 

(a) Within forty five (45) Working Days after the Completion Date, the
Transferee shall procure that the Company prepare (i) closing financial
statements of the Company as at close of business on the latest day of the month
prior to the Completion Date by applying the same accounting principles and a
format/mapping of accounts consistent with those used in the preparation of the
relevant financial statement of the preceding financial year (the “Closing
Financial Statements”) and (ii) a computation of the Net Debt in the format as
required in Schedule E (the “Closing Statement of Debt”) at the same date than
the Closing Financial Statements. The Transferors hereby undertake to cooperate
and provide the Transferee with all assistance and information required for such
purpose upon being requested to do so by the Transferee. As soon as reasonably
practicable, and in any event by no later than fifteen (15) Working Days after
the Closing Financial Statements and the Closing Statement of Debt have been
made available to the Transferee, the Transferee shall deliver to the
Transferors’ Agent a copy of the Closing Financial Statements, Closing Statement
of Debt and a statement (the “Transferee’s Statement”) signed by an authorized
representative of the Transferee, setting forth in reasonable detail a
computation of the net amount of the adjustments required by article 2.1(e)
above (the “Net Adjustment Amount”) based on the information set forth in the
Closing Financial Statements and the Closing Statement of Debt. As from the date
of the delivery of the Transferee’s Statement, the Transferee shall, subject to
reasonable notice, make available to the Transferors’ Agent and its advisors the
books and records relating to the Company reasonably required in connection with
their review of the Closing Financial Statements, Closing Statement of Debt and
the Transferee’s Statement.

 

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(b) Within twenty (20) Working Days of receipt by the Transferors’ Agent of the
Transferee’s Statement, the Transferors’ Agent may give written notice (the
“Transferors’ Disagreement Notice”) to the Transferee stating that it disagrees
with the Transferee’s Statement together with the reasons for such disagreement
in reasonable detail. If the Transferors’ Agent has not delivered a Transferors’
Disagreement Notice within such twenty (20) Working Days period, the
Transferee’s Statement shall be final and binding on the Parties for all
purposes. If the Transferors’ Agent and the Transferee do not reach agreement
(a) within twenty (20) Working Days after the Transferee’s receipt of the
Transferors’ Disagreement Notice or (b) as at Completion Date at the latest
about an AstStocks Dilution Event, the matters in dispute shall be referred to
the Independent Expert, as defined below, at the request of either of the
Transferors’ Agent and the Transferee, it being specified that, notwithstanding
that dispute, that fraction of the Net Adjustment Amount (if any) which will not
be in dispute will then be immediately paid. No matters other than those listed
in the Transferee’s Statement and in the Transferors’ Disagreement Notice shall
be within the terms of reference of the Independent Expert. The Independent
Expert shall be a firm of statutory auditors of international standing appointed
jointly by the Transferors’ Agent and the Transferee, within ten (10) Working
Days as from the corresponding request, or, if failing to reach an agreement
within this time-period, by order of the President of the Paris Commercial Court
ruling in the format of emergency proceedings (procédure de référé) at the
request of any of the Parties and without possible appeal.

 

(c) Except to the extent that the Transferee and the Transferors agree
otherwise, the Independent Expert shall determine its own procedures, and
interpret and apply the definitions set out in Schedule E and the other
directives and principles set out in this article 2.2 and related Schedules. The
Independent Expert shall also (i) give the Transferee and the Transferors’ Agent
an opportunity to make written and oral representations to it; (ii) require that
the Transferee and the Transferors’ Agent supply each other with a copy of any
written submission to the Independent Expert at the same time as such submission
is made to the Independent Expert, (iii) permit each of the Transferee and the
Transferors’ Agent to be present while oral submissions are being made by the
other and, more generally, (iv) at all times respect the principle of
“contradictoire”.

 

(d) The Independent Expert shall deliver to the Transferors’ Agent and to the
Transferee, within a period of twenty (20) Working Days after the date of its
appointment, a final report which shall indicate its determination of the Price
and the Net Adjustment Amount. Such final report shall explicitly state (i), if
the amount of the Estimated Price exceeds the Price (as thus determined), that
the Transferors shall pay to the Transferee the Net Adjustment Amount or (ii),
if the Price (as thus determined) exceeds the amount of the Estimated Price,
that the Transferee shall pay to the Transferors the Net Adjustment Amount. The
Independent Expert shall act as a “tiers arbitre mandataire” in accordance with
article 1592 of the French Civil Code and its determination of any matter
falling within its jurisdiction shall be final and binding on the Parties save
in the event of manifest error (erreur grossière).

 

(e) The fees, costs and expenses of the Independent Expert (as well as those of
any experts consulted by the Independent Expert) will be borne equally between
the Transferors and the Transferee (the fees to be borne by the Transferors
being allocated pro rata to their respective amount of Transferred Shares).

 

(f) For the purposes hereof, the “Final Closing Statement of Debt” shall be:

 

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  (i) the Closing Statement of Debt, if the Transferors’ Agent shall not have
delivered a Transferors’ Disagreement Notice in accordance with subsection
(b) above, or

 

  (ii) if the Transferors’ Agent shall have delivered a Transferors’
Disagreement Notice in accordance with subsection (b) above, either (A) the
definitive Closing Statement of Debt as agreed by the Transferor’s Agent and the
Transferee pursuant to subsection (c) above, or (B) in the absence of an
agreement between the Transferor’s Agent and the Transferee, the Closing
Statement of Debt read in light of the final report delivered by the Independent
Expert pursuant to the subsection (d) above.

 

2.3 Payment of Net Adjustment Amount and Retained Portion of the Purchase Price.

 

(a) If the amount of the Estimated Price exceeds the amount of the Price (as
determined pursuant to articles 2.1 and 2.2), the Transferors shall pay, pro
rata to their respective number of Transferred Shares, to the Transferee, the
amount equal to the excess of (x) the Estimated Price, over (y) the Price.

 

(b) If an amount shall be payable by the Transferors to the Transferee pursuant
to the foregoing subsection (a), it shall first be satisfied out of the Retained
Portion of the Price, and for any remaining balance (i.e. if the Net Adjustment
Amount is superior to the Retained Portion of the Price) in accordance with the
subsections (d) and (e).

 

(c) If the amount of the Price (as determined pursuant to articles 2.1 and 2.2)
exceeds the amount of the Estimated Price, the Transferee shall pay to the
Transferors the amount equal to the excess of (x) the Price over (y) the
Estimated Price. In such case, the Transferee shall pay in cash to the
Transferors the Retained Portion of the Price defined in article 2.1 (c) plus
any remaining balance in accordance with subsection (d) and (e).

 

(d) Any amounts payable pursuant to this article 2.3 shall be paid within five
(5) Working Days of the definitive determination of the Net Adjustment Amount by
electronic funds transfer of cash to a bank account of the recipient designated
in writing by the recipient at least three (3) Working Days prior to the date of
payment. Any delay shall give right to interest at a yearly rate of 5%.

 

(e) The allocation among the Transferors of any payments made to or by the
Transferors pursuant to this article 2.3 shall be made in accordance with the
allocation as set forth in Schedule B, it being specified that the Transferee
shall not be liable nor assume any responsibility in relation to such
allocation. The obligations of the Transferors to make payment pursuant to this
article 2,3 shall be several and not joint.

 

2.4 Specific guarantee of the Transferee.

 

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As from Completion Date and subject to the provisions of this article 2.4, the
Transferee shall indemnify and hold the Transferors harmless against any tax
liabilities, costs and expenses actually suffered and/or paid by them resulting
exclusively from any operation concerning the Astronics Corporation’s share
capital during the year following the Completion Date and having for
consequences that stake in Astronics Corporation received by any of the
Transferors at completion of the transaction contemplated herein represents more
than 1% of the share capital or voting rights of Astronics Corporation, and
therefore placing such Transferor in breach of the conditions required to
benefit from the tax regime provided under article 150 0D ter IV of the French
Code general des impôts.

For the avoidance of doubt, it is specified that the above indemnification
undertaking from the Transferee shall only be applicable if the crossing by a
Transferor of the threshold of 1% of the share capital or voting rights of
Astronics Corporation is a direct and exclusive consequence of such operation
over the share capital of Astronics Corporation during the year following the
Completion Date.

The Transferee acknowledges that this undertaking is material and of essence for
the Transferors, who would not have accepted the Payments Stocks without
guarantee regarding the above.

ARTICLES 3 – CONDITIONS PRECEDENT

 

3.1 The Transferors’ obligation to sell the Transferred Shares and the
Transferee‘s obligation to purchase the latter are subordinate to prior
fulfilment of the following conditions precedent (“Conditions precedent”):

 

(i) Prior agreement of the Transferee by the Company in accordance with the
terms of the articles of association.

 

(ii) Each of the representations and warranties made by the Transferors and the
Transferee under this Contract and the Guarantee agreement shall have been
accurate in all respects as of the date of this Contract and must be accurate in
all respects as of the Completion Date as if made on the Completion Date,
subject to the update of the schedules of the Guarantee agreement as set forth
in article 4.4.

 

(iii) The covenants, obligations, undertakings that the Parties are required to
perform or to comply with pursuant to this Contract at or prior to Completion
Date shall have been duly performed and complied with in all material respects.

 

(iv) No change, situation, development or other event having a Transferor
Material Adverse Effect or Transferee Material Adverse Effect shall have
occurred.

 

(v) Meetings (held physically or by conference call(s) in the most practical way
for the Transferee and the Transferors’ Agent) organized and managed by the
Transferors’ Agent with the three following customers: SOGERMA, Thompson and
PAC, such meetings and discussions being schedule to take place before
November 29, 2013.

For the avoidance of doubt, the purpose of these meetings will be exclusively to
introduce the Transferee and to enable identifying whether major issue comes up,
such as these customers indicate their will to materially and adversely change
their business relationship with the Company, which will constitute a Transferor
Material Adverse Effect.

 

3.2 Obligations of the Parties with respect to fulfillment of the conditions
precedent

 

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(i) The Parties undertake to do their best efforts to ensure that the condition
precedents stipulated in article 3.1 is met at their earliest convenience from
the Contract signature date.

 

(ii) In the event that one of the Parties is aware of any facts or circumstances
of such a nature as to compromise or jeopardise the fulfilment of one or more
conditions precedent, it undertakes to inform the other Parties thereof at its
earliest convenience in order to plan the necessary remedial measures to
implement.

 

3.3 Certification of fulfilment of conditions precedent

Certification of fulfilment of the above-mentioned conditions shall take place
at the initiative of the most diligent Party which shall notify the other Party
thereof.

The conditions must be fulfilled by 29 November 2013 at the latest.

On failure to fulfil any of the conditions before the above-mentioned date, the
Contract shall be considered null and void and each Party shall be entitled to
regain its full and complete liberty without any indemnity by either party,
without prejudice nevertheless to all compensation in the event that
non-fulfilment of a condition precedent should result from a wilful misconduct
by one Party with its commitments under the Contract. In this instance the
Contract shall be null and void, subject to the confidentiality obligations.

ARTICLE 4 — OTHER CONDITIONS WHICH APPLY PRIOR TO THE COMPLETION DATE

 

4.1 Temporary management of the Company

The Transferors shall procure that between the date of this Contract and the
Completion Date, the Company is managed in a responsible manner, in the context
of normal, prudent management and in compliance with current management
practices (in the ordinary course of business). In particular, the Transferors
undertake that, in the Company and prior to the Completion Date, none of the
following operations, decisions or actions shall be taken or performed without
the prior consent of the Transferee, which may not delay or refuse its consent
without legitimate reason:

 

(a) investment of an amount individually or when aggregated with other
investments based on substantially the same facts and circumstances in excess of
100,000 Euros,

 

(b) acquisition or sale of any interest in any business or entity, or form or
make any investment in any entity,

 

(c) acquisition or disposal of any assets (other than in the ordinary course of
business consistent with past practice),

 

(d) commitment to a new financing operation or contract any off-balance sheet
commitments exceeding 100,000 Euros in the aggregate,

 

(e) granting of performance, surety bonds or guarantee to third parties, incur
or guarantee any additional indebtedness or issue any notes, bonds or other debt
securities, grant any option, warrant or right to acquire any such debt
securities or issue any security convertible into or exchangeable for any such
debt securities or repurchase or prepay any indebtedness or enter into any
arrangement having the economic effect of any of the foregoing,

 

(f) increase of remunerations or other benefits payable to employees or company
officers, other than imposed by currently valid law or by existing contract or
company agreement disclosed to the Transferee or in the ordinary course of
business consistent with past practices,

 

(g) conclusion of any contract which could trigger the liability or a payment
obligation by the Company for an amount exceeding 100,000 Euros; amendment or
termination of any Significant Contract,

 

(h) change in business activity, legal structure, articles of association,
company capital or in the accounting and Tax methods, principles or practices
except insofar as may be required by law;

 

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(i) delay the payment of any trade payables or accelerate the payment of any
trade receivables, other than in the ordinary course of its business operations
consistent with past practice;

 

(j) launch of all new business activities or interruption of all existing
business activities,

 

(k) materially altering their employment contracts, firing or recruitment of
personnel, unless (i) on fixed term contracts in the legally provided cases, or
(ii) to replace a sick or resigning employee and if the gross annual
remuneration of the employee recruited in replacement does not exceed 70,000
Euros, or (iii) in the normal context of the Company’s business activities,

 

(l) withdrawal of funds from any bank account for a use other than strictly
necessitated by the Company’s normal, current operation,

 

(m) declare or pay-out of dividends (in any form whatsoever, including interim
dividends) or other distributions, sharing, dissolving or reduction of capital,

 

(n) payment of any management or other fees or amount to the Transferors or any
their respective Related Parties,

 

(o) legal operation such as merger, demerger, partial contribution of assets,
dissolving or liquidation,

 

(p) transfer or amortisation of any Shares (it being stipulated, where
necessary, that said obligation shall not prevent the Transferors from
purchasing any Shares currently owned by a company officer or shareholder or
minority shareholder with a view to their sale to the Transferee on the
Completion Date),

 

(q) create any Third Party Right on (x) Shares or other securities or (y) on any
assets, except, in respect of (y), in the ordinary course of business consistent
with past practice,

 

(r) issue (or promise to issue or award to any third party) tradable securities,
of any kind (including for the avoidance of doubt, any securities convertible
into, or any rights, warrants or options to acquire any shares, voting
securities or convertible securities) or otherwise make any changes to its
capital stock,

 

(s) pay, discharge, settle or satisfy any material claims, liabilities or
obligations or any disputes for payments in excess of 100,000 Euros other than
payment, discharge, settlement or satisfaction in the ordinary course of
business consistent with past practice,

 

(t) enter into, amend, waive the benefits of or terminate any contract with the
Transferors or any of their respective Related Parties,

 

(u) taking any action, or omitting to take any action, which action or omission
would result in a breach of any of the representations and warranties made by
the Transferors in this Contract, or

 

(v) authorizing, or committing, resolving or agreeing to take any of the
foregoing actions.

The Transferee acknowledges that it has been duly informed that the company
ACTEURS SA, a public limited company with registered capital of 107,200 Euros,
whose registered office is at rue Isaac Newton – 18000 Bourges, registered on
Bourges Corporate and trade register under number 400 617 361, is under the
legal process of amicable liquidation (liquidation amiable) since June 25, 2013
and that the company REGITEC SARL, a limited liability company with registered
capital of 16,000 Euros, whose registered office is at rue Isaac Newton – 18000
Bourges, registered on Bourges Corporate and trade register under number
402 947 337 I is under the process of judicial liquidation (liquidation
judiciaire) since November 27, 2012. In this context, the Company shall not be
bound by any outstanding obligations nor any liabilities arising in, or which
could result from, the context of these liquidations, given that the Company nor
the Transferors are not the legal representatives of ACTEURS SA nor REGITEC
SARL. The Parties hereby agree and undertake that no agreement relating to
definitive liquidation of ACTEURS SA or REGITEC SARL will be entered into
without the prior consent of the Transferee.

 

4.2 Access and Information

The Transferors undertake to inform the Transferee of all above-mentioned new,
significant facts or events, brought to their attention, relating to the Company
or the Activity of the Company, arising between the Contract date and the
Completion Date or brought to the Transferors’ attention during this period.

 

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In addition, during the period from the date of this Contract until the
Completion Date, upon the reasonable written request of the Transferee, the
Transferors shall arrange for the Transferee and its representatives to be in
position to contact Mr Jean-François Piaulet, the Deputy General Manager
(Directeur Général Délégué) or the Chief Financial Officer (Directeur Financier)
of the Company during normal business hours in order to have a reasonable access
to the books and records of the Company and be informed of its business
activity, provided that such contact is requested with a two (2) Working Days
prior notice and shall not interfere with the normal business and operations of
the Company. It is specified for the avoidance of doubt that the Transferors
cannot unreasonably refused to grant such access.

 

4.3 Exclusivity

Between the Contract date and the Completion Date, the Transferors undertake not
to conduct, directly or via an intermediary, any negotiation with anyone
whatsoever concerning or relating to, directly or indirectly, all or part of the
Shares or assets of the Company to a third party.

 

4.4 Guarantee agreement update

Between the Contract date and the Completion Date, the Parties undertake to
update the schedules to the Guarantee agreement of which a draft is attached as
Schedule 5.3. The Transferors shall be entitled to update the declarations and
guarantees for all events occurring between the date of this Contract and the
Completion Date subject to having duly informed the Transferee thereof, unless
(i) the event object of the update constitutes an infringement of the
commitments of the interim period in article 4.1, (ii) such supplement or
amendment (A) arises from any matters known by any of the Transferors on the
date hereof or (B) reflects matters which, individually or in the aggregate, are
likely to result in a loss, damage, prejudice or any other kind of liabilities,
costs or expenses for the Company or the Transferee exceeding 100,000 Euros.

 

4.5 Significant contracts

Significant Contracts containing an intuitu personae clause requiring the
co-contracting party’s consent or a change of control clause are listed in
Schedule 4.5. The Transferors shall do their best efforts to ensure the
continuation of these Significant Contracts.

ARTICLE 5 — COMPLETION DATE

The Parties shall transfer ownership of the Transferred Shares to the Transferee
in exchange for payment by said latter of the Price according to article 2, on
4 December 2013 at 9.a.m. at the offices of HOGAN LOVELLS LLP, 17 avenue
Matignon in Paris (France), unless the Parties reach express agreement on
another date or location (the “Completion Date”), if all of the conditions
precedent mentioned in article 3 are fulfilled by 29 November 2013 at the latest
and if this Contract has not been terminated in accordance with this Contract.

On the Completion Date, each of the Transferors, shall transfer all of their
Shares to the Transferee and the Transferee shall pay the Price to the
Transferors in accordance with article 2 (the “Closing”).

The Parties agree that the Price shall be allocated among the Transferors, under
the sole responsibility of the Transferors and further agree that in any case
the Transferee shall have no liability for the allocation of the Price among the
Transferors.

 

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Thus, on the Completion Date, the Parties to this Contract shall be required to
complete or ensure that the following documents are completed:

 

  •   Prior agreement of the new shareholder and the appointment of the new
company officers;

Furthermore, each Party shall be required to provide the other with the
following documents, on said same date, it being specified that all matters at
the Closing will be considered to take place simultaneously, and no delivery of
any document required to be completed at or in connection with the Closing will
be deemed complete until all transactions and deliveries of documents required
by this Agreement to be completed at or in connection with the Closing are
completed.

 

5.1 Documents to be provided by the Transferors

 

(a) Originals of share transfer orders duly signed by the Transferors, bearing
the Completion Date, certifying transfer of full ownership of and title to all
of the Transferred Shares to the Transferee free and clear of any Third Party
Right;

 

(b) Original minutes of the Board of Directors of the Company (i) confirming
Mr. Jean-François Piaulet in his current position of President and General
Manager for a four months period as from the Completion Date without changes in
the management, (ii) deciding a subsequent second four months period during
which the scope of liabilities of Mr. Fabrice Berthelot will be extended, and
Mr. Fabrice Berthelot will be entitled to directly report to the Transferee and
(iii) deciding a third four months period where Mr. Jean-François Piaulet
commits to give his resignation letter as General Manager only and remaining
President of the Board, without executive position. It is specified for the
avoidance of doubt that any resignation shall be rendered without costs to the
Company that no claims or monies would be owed by the Company to such person in
such capacity in connection with such resignations;

 

(c) Original resignation letters of Marc Piaulet, Daniel Piaulet and Gérard
Robin of their respective duties as Directors (Administrateurs) of the Company
taking effect on the Completion Date and including statements to the effect that
such resignation is rendered without costs to the Company and no claims or
monies are owed by the Company to such person in such capacity (excluding, for
the avoidance of doubt, the sums due by the Company to Mr. Marc Piaulet and
Mr. Marc Moulin as employees);

 

(d) The following documents, which shall be up to date in respect of all
operations performed through to the Completion Date inclusive:

 

  (i) registers of share transfer orders and individual shareholder’s accounts
for the Company;

 

  (ii) registers containing minutes of the decisions of the shareholders meeting
since its creation; registers or attendance sheets associated therewith;

 

(e) A certified copy of the minutes of the Company board of directors approving
the Transferee as shareholder, in accordance with the terms of its articles of
association.

 

(f) CERFA N°2759 DGI forms associated with the sale of their Shares, duly signed
by each of the Transferors for the Transferred Shares it is selling;

 

(g) A certified copy of the minutes of the Works council meeting whose purpose
is the operation object of this Contract, it being stipulated that the Works
council has already been informed and consulted on the Contract date.

 

(h) An original of a certificate duly signed by each Transferor whereby each
Transferor confirms that (i) apart from the settlement agreements entered into
with Mr Pascal Moulin and Mr Laurent Groussin relating to the termination of
their respective employment contracts, it has no longer any relationship with
the Company and any and all contracts entered into between any Transferor or its
respective Related Parties with the Company has been terminated as of the
Completion Date and that (ii) the Company no longer owes any sums to the
Transferors or their respective Related Parties (apart from the employment
contracts of Mr. Marc Piaulet and Mr. Marc Moulin).

 

(i) A certified copy of the shareholders’ meeting relating to ACTEURS SA
winding-up.

 

(j) A closing certificate, in the form set out in schedule 5.1, duly signed by
the Transferors as Guarantors under the Guarantee agreement reiterating the
representations and warranties contained in this Contract as well as in the
Guarantee agreement as at the Completion Date, up-dated according to article
4.4.

 

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(k) An original copy of all relevant and satisfactory documents confirming that
the Transferors obtained all required consents from the co-contracting parties
of any contracts entered into by the Company and providing for early termination
in the event of change of control.

 

(l) A bank guarantee (caution) granted by a first rank French credit institution
for an amount equal to 10% of the Estimated Price, in substantially the form
attached hereto as schedule 5.1(l) (the “Indemnity Bank Guarantee”) duly signed
by the bank and the Transferors. The terms and conditions of the Indemnity Bank
Guarantee shall be reasonably satisfactory for the Transferee.

 

(m) The Guarantee agreement duly signed by the Transferors.

 

(n) Confirmation that the DADS2 for fiscal year 2012 form has been duly and
properly filled on 1st October 2013.

 

(o) Original minutes of the Board of Directors of the Company approving
(“arrêtant”) the Reference Accounts.

 

5.2 Documents to be provided by the Transferee

At the Completion Date, the Transferee shall pay the Estimated Price, in
accordance with article 2.1 (c) and (d).

At the Completion Date, the Transferee shall (i) issue and deliver to the
Transferors documents evidencing the transfer of ownership of the shares in
Astronics Corporation to be transferred to the Transferors in accordance with
article 2.1(c)(ii) and 2.1 (d) including share certificates made out to each of
the Transferors and (ii) provide the Transferors with the first demand bank
guarantee related to the payment of the Retained Portion of the Price set forth
in article 2.1(c)(i) and (iii) provide the Transferors a closing certificate, in
the form set out in schedule 5.2, duly signed by the Transferee as reiterating
the declarations made under Article 6.2 of the Contract contained in the
Contract as at the Completion Date.

 

5.3 Documents to be signed & exchanged between the Parties

By the Completion Date at the latest, the Parties shall sign and provide each
other with originals of the following documents: the guarantee agreement, in
accordance with the terms featured in Schedule 5.3, plus associated schedules
(the “Guarantee agreement”) and the Indemnity Bank Guarantee.

ARTICLE 6 — DECLARATIONS OF THE PARTIES

 

6.1 Transferors’ declarations

 

(a) The Transferors have the necessary powers to conclude and sign the Contract,
perform the operations therein and fulfil their obligations under the Contract,
in particular regarding their respective matrimonial property regimes where
applicable.

 

(b) The Contract has been validly concluded and signed by the Transferors and
constitutes a legally valid obligation, which may be enforced against said
Transferors in accordance with the terms therein, without restriction or
reservation.

 

(c) The heirs and other beneficiaries of the Transferors, even minors or legally
incapable, shall be jointly and severally liable with their respective
Transferor(s), for the fulfilment of all obligations resulting from the
Contract, the Transferee being already dispensed from serving the notice
stipulated in article 877 of the Civil code.

 

(d) By reason of its business or financial experience, each Transferor is
capable of evaluating the risks and merits of an investment in Astronics
Corporation and of protecting its own interests in connection with this
investment.

 

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(e) Each Transferor has acquired securities in Astronics Corporation for
investment purposes for its own account only and not with a view to or for sale
in connection with any distribution of all or any part of such interest.

 

(f) Each Transferor acknowledges that its interest in Astronics Corporation has
not been registered under the Securities Act, or under any applicable blue sky
laws in reliance, in part, upon its representations, warranties, and agreements
herein.

 

(g) Each Transferor understands that its securities in Astronics Corporation are
“restricted securities” under the Securities Act in that such securities will be
acquired from the Transferee in a transaction not involving a public offering,
and that its securities in Astronics Corporation may be resold without
registration under the Securities Act, or pursuant to an exemption therefrom.

 

(h) It represents, warrants, and agrees that the Transferee and the Transferors
are under no obligation to register or qualify their respective interests in
Astronics Corporation under the Securities Act or under any state securities
law, or to assist it in complying with any exemption from registration and
qualification.

 

(i) Without limiting the representations set forth above, and without limiting
anything contained elsewhere in this Contract, none of the Transferors will make
any disposition of all or any part of its interest in Astronics Corporation
which will result in violation by it or by the Transferee of the Securities Act
or any other applicable securities laws. Without limiting the foregoing, each
Transferor agrees not to make any disposition of all or any part of its
securities in Astronics Corporation unless and until it has notified the
Transferee of the proposed disposition and obtained from the Transferee a
written confirmation that such disposition will not require registration of any
securities under the Securities Act or the consent of or a permit from
appropriate authorities under any applicable state securities laws.

 

(j) The Transferors acknowledge that their interests in Astronics Corporation
involve a substantial degree of risk of loss of its entire investment, and
understand and take full cognizance of the risks related to the acquisition of
such interests.

 

(k) Each Transferor has received and reviewed this Contract and the other
information provided by the Transferee it considers necessary or appropriate for
deciding whether to invest in Astronics Corporation.

 

(m) None of the Transferors have seen, received, been presented with, or been
solicited by any leaflet, public promotional meeting, article or any other form
of advertising or general solicitation with respect to the sale of securities in
Astronics Corporation.

 

6.2 Transferee’s declarations

 

(a) Astronics Corporation is a stock company duly organized and validly existing
and in good standing under the laws of New York State.

(i) The authorized capital stock of Astronics Corporation consists of 40,000,000
ordinary shares of AstStock, of which 11,495,436 shares were issued and
outstanding as of the close of business on October 31, 2013 and 10,000,000 Class
B shares of AstStock, of which 5,984,657 shares were issued and outstanding as
of the close of business on October 31, 2013. The Class B shares and the
ordinary shares carry identical rights and vote as a single class in
shareholder’s meeting, except that Class B Shares carry 10 voting rights per
shares and ordinary shares carry one voting right per share. All of the shares
of AstStock (A) have been duly authorized and validly issued, (B) are fully paid
and non-assessable, and (C) were issued in compliance with all applicable
security laws concerning the issuance of securities.

(ii) The Payment Stocks are not subject to any voting trust agreement or other
contract, agreement or arrangement restricting or otherwise relating to the
voting, dividend rights or disposition of such equity interests other than the
Contract.

 

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(b) The Transferee has the necessary powers to conclude and sign the Contract,
perform the operations and fulfil the obligations for which it is responsible
under the Contract. The Transferee has made all acts required to be made under
the Transferee’s corporate documents (i.e. by-laws, rules of procedure for the
boards of directors and any similar corporate documents) and applicable law to
enter into the Contract and perform its obligations hereunder. No consent from
any shareholder, creditor or any other Person, or notification to or
registration with any court of law or administrative body is required in
connection with the execution and performance of the Contract, except as set out
in the Contract.

 

(c) Astronics Corporation has filed or furnished, as applicable, on a timely
basis all reports, schedules, forms, statements and other documents required to
be filed by it under the Exchange Act or any successor statute, and the rules
and regulations promulgated thereunder, including pursuant to Section 13(a) or
15(d) thereof, since December 31, 2011. Each such report complied, or if not yet
filed or furnished, will comply, in all material respects with the applicable
requirements of the Exchange Act, the Securities Act and the Sarbanes-Oxley Act,
and any rules and regulations promulgated thereunder. As of their respective
dates, such reports did not, and any such reports filed with or furnished to the
SEC subsequent to the date hereof will not, contain any untrue statement of a
material fact or omit to state a material fact required to be stated therein or
necessary to make the statements made therein, in light of the circumstances in
which they were made, not misleading.

 

(d) None of Astronics Corporation, its affiliates (as defined in Rule 501(b) of
Regulation D under the Securities Act, an “Affiliate”) or any person acting on
its or their behalf has directly, or through any agent, (A) sold, offered for
sale, solicited offers to buy or otherwise negotiated in respect of, any
security (as defined in the Securities Act) which is or will be integrated with
the transfer of the AstStocks in a manner that would require registration of the
AstStocks under the Securities Act or (B) engaged in any form of general
solicitation or general advertising (as those terms are used in Regulation D) or
directed selling efforts (within the meaning of Regulation S) in connection with
the offering or sale of the AstStocks, or in any manner involving a public
offering within the meaning of Section 4(2) of the Securities Act.

 

(e) It is not necessary in connection with the offer, sale and delivery of the
AstStocks in the manner contemplated by this Contract to register the AstStocks
under the Securities Act; none of Astronics Corporation, its Affiliates or any
person acting on its or their behalf has performed or shall perform transactions
to offer, sell, or deliver securities that would result in an obligation to
register the AstStocks under the Securities Act.

 

(f) Neither Astronics Corporation nor any of its subsidiaries has taken,
directly or indirectly, any action intended to constitute, or having the effect
of constituting, or which would have constituted or could constitute, a
stabilization or a manipulation of the price of any security of Astronics
Corporation to facilitate the sale or resale of the AstStocks.

 

(g) Except for the stock distribution performed on October 24, 2013 in which
each Astronics Corporation shareholder received one share of Astronics Class B
Stock for every five shares of Astronics common stock and Class B Stock held by
such shareholder on October 10, 2013, since December 31, 2012 and through the
date hereof, Astronics Corporation has not made any declaration, setting aside
or payment of any dividend or other distribution with respect to any shares of
AstStocks or any repurchase or other acquisition by Astronics Corporation of any
outstanding shares of AstStocks.

 

(h) The Payment Stocks are duly authorized and will be validly issued, fully
paid and will not be subject to any option, call, preemptive, subscription or
similar rights under any provision of applicable law, the organizational
documents of Astronics Corporation or any of its subsidiaries, except otherwise
provided herein.

 

(i) The Contract has been validly concluded and signed by the Transferee and
constitutes a legally valid obligation, enforceable against the Transferee in
accordance with the terms therein, without restriction or reservation.

 

(j) Contract signature and fulfilment plus the enforcement of the operations and
commitments mentioned therein do not contravene any legal, regulatory or
statutory provisions, or administrative, judicial or arbitral decisions,
applicable to the Transferee, nor any terms of any contracts concluded by the
Transferee or any binding obligation upon the Transferee.

 

( ) The Payment Stocks shall be delivered to the Transferors indirectly by the
Transferee on the Completion Date, who shall be the owner, on said date, of the
Payment Stocks free from all pledge, pre-emptive right and any other Third Party
Rights whatsoever, in payment for the sale of Transferred Shares.

 

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(l) Upon the terms and subject to the conditions set forth in this Contract, the
Transferors will as from the Completion Date, become, in accordance with the
allocation mentioned in Schedule B, the owners of the Payment Stocks together
with all rights and benefits attached thereto, and will acquire full title
(pleine et entière propriété) thereof. At this point in time, the Transferors
shall, in respect of the Payment Stocks they will have received be entitled to
receive all pay-outs of dividends and other distributions which may occur as
from the Completion Date and of every rights attached to the full ownership of
such AstStocks.

ARTICLE 7 — POST-COMPLETION COVENANTS

 

7.1 No claims against the Company. After the Completion Date, the Transferors
shall not, and shall procure that none of their Related Parties, assert any
claim against the Company based on their capacity as a former direct or indirect
shareholders of Company.

 

7.2 Non-Solicitation of Employees. For period of three (3) years after the
Completion Date, the Transferors shall not, and shall procure that none of their
respective Related Parties, offer, solicit or induce to enter into, any written
or oral arrangement, agreement or understanding regarding employment or
retention as a consultant with any individual who is, on the date hereof, a
director, officer, or key technical employee of the Company.

 

7.3 Non-Compete

 

  a. For a period of three (3) years after the Completion Date, and unless
authorized in writing by the Transferee, the Transferors shall not, and shall
procure that none of their respective Related Parties:

 

  i. participate or engage, directly or indirectly, for itself or on behalf of
or in conjunction with any person, whether as agent, shareholder, partner, joint
venture, investor or otherwise, in any activities, competing with, related to or
incidental to the business of the Company and the Transferee within territories
where they carry out their Activities;

 

  ii. whether for its own account or for the account of any other person,
directly or indirectly, solicit, endeavour to entice away from the Company or
otherwise directly interfere with the relationship of the Company with any third
party who is an important customer, distributor or a supplier of the Company.

 

  b. The Transferors shall not, and shall procure that none of their respective
Related Parties, disclose or use for any purpose any confidential or proprietary
information concerning the Company or their businesses, operations, properties
or assets, except (i) to the extent required by applicable law; (ii) to its
professional advisers under circumstances of confidentiality; or (iii) to the
extent that such information is at the date hereof or hereafter becomes public
knowledge otherwise than through improper disclosure by any person.

 

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  c. The Parties acknowledge that the foregoing restrictions are reasonable in
scope, are necessary for the Company’s business and goodwill and form an
essential part of the consideration for which the Transferee is willing to enter
into the Contract. If any provision of this article 7.3 shall be adjudicated to
be invalid, ineffective or unenforceable, the remaining provisions shall not be
affected thereby. The invalid, ineffective or unenforceable provision shall,
without further action by the Parties, be amended automatically to effect the
original purposes and intent of the invalid, ineffective or unenforceable
provision; provided, however, that any such amendment shall apply only with
respect to the operation of such provision in the particular jurisdiction with
respect to which such adjudication is made. Without limiting the generality of
the foregoing, if any provision of this article 7.3 is invalid in part, it shall
be curtailed, as to scope, time and location, to the minimum extent required for
its validity in the jurisdiction in which such provision is challenged, and
shall be binding and enforceable with respect to the Transferors as so
curtailed.

 

  d. Without intending to limit the remedies available to the Transferee, each
Transferor agrees for itself and on behalf of its Related Parties that a breach
of any covenant contained in this article 7.3 may cause a material irreparable
harm and that a monetary remedy for a breach thereof may be inadequate and
impracticable. Each Transferor further agrees that the Company or the Transferee
shall be entitled to obtain temporary and permanent injunctive relief without
the necessity of proving actual damages or posting any bond. In the event of
such a breach or threat of breach, each Transferor agrees on its behalf and on
behalf of its Related Parties that the Transferee shall be entitled to such
injunctive relief, including temporary restraining orders, preliminary
injunctions and permanent injunctions as a court of competent jurisdiction shall
determine.

 

  e. Without prejudice to the above non-compete agreement regarding Mr
Jean-François Piaulet, it is specified that (i) his son, Mr Marc Piaulet, is
employed by the Company as Commercial and Marketing Manager (Directeur
Commercial et Marketing) and bound by a specific non-compete agreement according
to his employment contract, and that (ii) his daughter, Mrs Estelle Piaulet has
an activity of consulting in human resources matters for companies having
business in aeronautic. For the avoidance of doubt, it is specified that
Mr. Jean-François Piaulet will not in any circumstances help or support his son
or daughter having an adverse effect, whether direct or indirect, on the above
non-compete agreement, but will not be personally liable for any act occurred
without his support.

 

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  f. By exception to the non-compete provision provided under article 7.3(a),
for a period of two (2) years, Laurent Groussin shall not carry out any activity
or perform any action which would compete the Activity of the Company. For the
avoidance of doubt, Mr Laurent Groussin is bound by the any and all other
provisions of this article 7 in their other aspects. However, the Transferee
hereby acknowledges that Mr Laurent Groussin will carry out an activity of
consulting (on his own or through a privately owned company) in the area of
global seat safety and definition of specifications of seats (which may concern
partially seat motion and actuation issues but which shall exclude for the
avoidance of doubt, the consulting in the sole area of seat motion and
actuation) to the benefit of seat manufacturers and /or airlines (other than
Thompson, Precilec (Zodiac Actuation System) and any of their respective related
companies).

 

7.3 Transferee’s covenants

Astronics Corporation covenants to file on a timely basis all required reports
under Section 13(a) or 15(d) under the Exchange Act, other than Form 8-K
reports, and submit electronically and post on its corporate Web site every
Interactive Data File required to be submitted and posted pursuant to Rule 405
of Regulation S-T. Each such report will comply in all material respects with
the applicable requirements of the Exchange Act, the Securities Act and the
Sarbanes-Oxley Act, and any rules and regulations promulgated thereunder. As of
their respective dates, such reports will not contain any untrue statement of a
material fact or omit to state a material fact required to be stated therein or
necessary to make the statements made therein, in light of the circumstances in
which they were made, not misleading. Astronics Corporation further undertakes
to promptly and at its own expense take such reasonable steps as may be
necessary or appropriate to permit the disposal of the AstStocks in U.S. market
transactions, including without limitation to remove or cause to be removed any
restrictive legends relating to the AstStocks from the relevant share
certificates or the Astronics Corporation share registry, as applicable upon the
expiry of the applicable holding period under Rule 144(d) under the Securities
Act.

ARTICLE 8 — INDIVISIBILITY OF COMMITMENTS

 

8.1 Each of the Contract terms shall determine the respective commitments of the
Parties, which are legally bound thereto. Deeds which reiterate, observe or
detail the terms of agreement contained in the Contract shall be subordinate to
the terms of the latter. No prior drafts of this Contract and no words or
phrases from any such prior drafts shall be admissible into evidence in any
dispute involving this Contract.

 

8.2 The Parties shall be required to enforce and comply with (and ensure that
the company that they control enforces and complies with) each of the Contract
terms, in particular sign (or have signed) all necessary deeds reiterating,
observing or detailing the latter.

 

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ARTICLE 9 — NOTIFICATIONS

All notices and other communications required or permitted to be given or made
pursuant to this Contract shall be in writing and shall be: (x) delivered by
hand against an acknowledgement of delivery dated and signed by the recipient;
(y) sent by an overnight courier service of recognized international standing
(all charges paid); or (z) sent by facsimile transmission and confirmed by
registered mail (postage prepaid, return receipt requested) (lettre recommandée
avec demande d’avis de réception) posted no later than the following Working Day
(with any such facsimile transmission to be deemed received at the time
indicated on the corresponding activity report, a copy of which shall be
included in the confirmation by mail) (provided that any notice or communication
which is received after 6 p.m. (local time in the place of receipt) on a Working
Day or on any day which is not a Working Day shall be deemed received only at 9
a.m. (local time in the place of receipt) on the next Working Day) to the
relevant party at its address set forth below:

 

If to the Transferors, to:    Mr. Jean-François Piaulet    28, Rue Romain
Rolland    36130 Déols    Attention: Mr. Jean-François Piaulet   
(jeanfrancois.piaulet@orange.fr)    with a copy to:    ARISTEA    29, rue de
Marignan    75008 Paris    Attention: Mrs Anne-Sophie Bastard de Crisnay   
(asb@aristea.fr)    Mr. Arnaud Meunier du Houssoy    (amh@aristea.fr) If to the
Transferee, to:    Astronics Corporation    130 Commerce Way    East Aurora, NY
- 14052-2191    USA    Attention: Mr. Peter Gundermann   
(Peter.Gundermann@astronics.com)    with a copy to:    Astronics Corporation   
130 Commerce Way    East Aurora, NY - 14052-2191    USA    Attention: Mr. David
Burney    (david.burney@astronics.com)    with a copy to:    Hogan Lovells
(Paris) LLP    17, avenue Matignon    75008 Paris    Attention: Mr. Jean-Marc
Franceschi    (jean-marc.franceschi@hoganlovells.com)

 

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or to such other persons or at such other addresses as hereafter may be
furnished by either party by like notice to the other. Any such notice or other
communication shall be effective only upon actual receipt thereof by its
intended recipient.

ARTICLE 10 —MISCELLANEOUS TERMS

 

10.1 The Contract, including the schedules thereto, expresses all of the
contractual obligations of the Parties and replaces and/or cancels all prior
verbal or written communication(s), proposition(s), commitment(s) between the
Parties relating to the subject matter of this Contract. The Contract may only
be amended by a written document signed by the Parties.

 

10.2 The Contract and the operations stipulated therein are strictly
confidential, in particular terms pertaining to the Price and its financing,
subject to (i) the option for the Parties to disclose said document to their
advisers bound by professional secrecy and banks for the financing necessary for
fulfilment of the Contract purpose, (ii) legal or administrative necessity to
assert its rights or Contract performance and (ii) all other imperative rules.
Consequently, outside this scope, the Parties undertake not to inform the public
or publish any communiqué concerning the Contract, content of the latter, or the
operations mentioned therein, or authorise any of their respective employees,
advisers or agents to publish such communiqués, without prior written consent
from the other Parties.

In particular, the Parties undertake to dialogue as of the Completion Date in
order to agree on common communication, in particular by communiqué, to
commercial and financial partners, as well as Company employees.

 

10.3 In the event that any of the terms of this Contract are declared null or
void in any way and for any reason whatsoever, the Parties undertake to dialogue
to remedy the cause of the observed nullity in such a manner that, barring
impossibility, the Contract shall remain valid without discontinuity with the
same economic effect.

The Contract schedules are an integral part of this Contract. In the event of
contradiction between the terms of the Contract and the appended schedules, the
Contract terms shall be overriding.

 

10.4 The Transferors may not under any circumstances transfer any of their
rights or any of their obligations under the Contract without prior, written
consent from the Transferee. The Transferors are acting jointly and severally
for the transfer of the Transferred Shares, but not for the representations and
warranties granted under the Guarantee agreement.

The Contract shall benefit the Transferee, plus all other physical persons or
legal entities that it wishes to joinder, or replace it or delegate it rights
to, throughout the Contract term of validity.

 

10.5 The rights and obligations of the Transferors under the Contract shall
benefit their heirs, beneficiaries and successors and are legally binding for
them.

ARTICLE 11 — SETTLEMENT OF DISPUTES

 

11.1 The Contract is governed by French law.

 

11.2 All disputes arising between the Parties pertaining to Contract
interpretation or performance shall, on failure to reach an out-of-court
agreement within thirty (30) days of certification of the dispute, be referred
to the jurisdiction of Paris Commercial Court.

 

11.3 The Parties agree that the binding version shall be the English version and
that the French version is solely for information purposes.

 

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ARTICLE 12 — COSTS, DISBURSEMENTS & FEES

Each Party shall pay the fees of its own advisors incurred for the preparation,
drafting or performance of the Contract and subsequent documents, with the
exception of registration fees due for the purchase of the Transferred Shares
from the Transferors which shall be paid by the Transferee as well as fees and
costs regarding Payment Stocks.

ARTICLE 13 — ADDRESS FOR SERVICE

For the purposes of Contract fulfilment, the Parties appoint address for service
of notice at their respective registered offices mentioned at the beginning of
this contract.

oOo

Executed in Paris, on 4 November 2013, in five (5) original copies signed by the
Parties.

 

 

The Transferee Represented by The Transferors:

 

Mr Jean-François PIAULET

 

Mr Daniel PIAULET

 

Mr Pascal MOULIN

 

Mr Laurent GROUSSIN

 

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