PURCHASE AGREEMENT DATED AS OF DECEMBER 12, 2006 BY AND AMONG CELANESE LTD., TICONA POLYMERS INC., CELANESE CHEMICALS EUROPE GMBH, CELANESE CORPORATION, ADVENT OXO (CAYMAN) LIMITED, OXO TITAN US CORPORATION, DRACHENFELSSEE 520. V V GMBH AND...
Exhibit 10.27
[*** The confidential portions of this exhibit have been filed separately with the Securities and
Exchange Commission pursuant to a confidential treatment request in accordance with Rule 24b-2 of
the Securities and Exchange Act of 1934, as amended. The location of each omitted portion is
indicated by a series of three asterisks in brackets (“[***]”).
The Schedules and Exhibits referenced in this Purchase Agreement have been omitted pursuant to Item
601(b)(2) of Regulation S-K. Copies of the omitted Schedules and Exhibits will be provided to the
Securities and Exchange Commission upon its request.”]
DATED AS OF DECEMBER 12, 2006
BY AND AMONG
CELANESE LTD.,
TICONA POLYMERS INC.,
CELANESE CHEMICALS EUROPE GMBH,
CELANESE CORPORATION,
ADVENT OXO (CAYMAN) LIMITED,
OXO TITAN US CORPORATION,
DRACHENFELSSEE 520. V V GMBH
AND
DRACHENFELSSEE 521. V V GMBH
TABLE OF CONTENTS
| Page | ||||||||
| 1. | Definitions | 2 | ||||||
| 2. | Purchase and Sale of Assets | 16 | ||||||
| (a) | Purchase of Assets | 16 | ||||||
| (b) | Excluded Assets | 18 | ||||||
| (c) | Liabilities | 19 | ||||||
| (d) | Purchase Price for Purchased Assets | 23 | ||||||
| (e) | Allocation of Purchase Price | 26 | ||||||
| (f) | Closing | 26 | ||||||
| (g) | Deliveries and Actions at Closing | 26 | ||||||
| (h) | Special Covenants | 27 | ||||||
| 3. | Representations and Warranties of Parent and Sellers | 28 | ||||||
| (a) | Organization | 28 | ||||||
| (b) | Authorization of Transaction | 28 | ||||||
| (c) | Non-contravention | 28 | ||||||
| (d) | Material Contracts | 29 | ||||||
| (e) | Employee Matters | 30 | ||||||
| (f) | Litigation | 32 | ||||||
| (g) | Compliance With Laws | 32 | ||||||
| (h) | Permits | 33 | ||||||
| (i) | Environmental Matters | 33 | ||||||
| (j) | Condemnation | 34 | ||||||
| (k) | Title to Purchased Assets; Sufficiency | 34 | ||||||
i
TABLE OF CONTENTS
(continued)
| Page | ||||||||
| (l) | Intellectual Property and Technology | 35 | ||||||
| (m) | Taxes | 36 | ||||||
| (n) | Capitalization | 38 | ||||||
| (o) | Financial Information | 39 | ||||||
| (p) | Inventories | 40 | ||||||
| (q) | Accounts and Notes Receivable and Payable | 40 | ||||||
| (r) | Intercompany Transactions | 40 | ||||||
| (s) | Customers and Suppliers | 40 | ||||||
| (t) | Product Warranty; Product Liability | 40 | ||||||
| (u) | Site Service Cost Coverage | 41 | ||||||
| (v) | Site Service Profit | 41 | ||||||
| (w) | Disclaimers Regarding Assets | 41 | ||||||
| 4. | Representations and Warranties of Buyer | 41 | ||||||
| (a) | Organization of Buyer | 41 | ||||||
| (b) | Authorization of Transaction | 42 | ||||||
| (c) | Non-contravention | 42 | ||||||
| (d) | Litigation | 42 | ||||||
| (e) | Availability of Funds; Financing | 42 | ||||||
| 5. | Pre-Closing Covenants | 43 | ||||||
| (a) | General | 43 | ||||||
| (b) | Notices, Assignments and Consents | 43 | ||||||
| (c) | Operation of Business | 43 | ||||||
ii
TABLE OF CONTENTS
(continued)
| Page | ||||||||
| (d) | Antitrust Approvals | 45 | ||||||
| (e) | Access to Information | 46 | ||||||
| (f) | Cooperation with Financing | 46 | ||||||
| (g) | Exclusivity | 47 | ||||||
| (h) | Pensionskasse | 47 | ||||||
| (i) | Change of Fiscal Year | 47 | ||||||
| (j) | Amendment of Infraserv Leases | 47 | ||||||
| (k) | Termination of Hereditary Building Right | 47 | ||||||
| (l) | Ancillary Shares Consent | 48 | ||||||
| 6. | Post-Closing Covenants | 48 | ||||||
| (a) | General | 48 | ||||||
| (b) | Employees and European Employees | 48 | ||||||
| (c) | Noncompetition; Nonsolicitation; Confidentiality | 48 | ||||||
| (d) | Use of “Celanese” Name | 51 | ||||||
| (e) | Taxes; Prorations | 51 | ||||||
| (f) | Post Closing Cooperation by Buyer | 56 | ||||||
| (g) | Further Assurances | 57 | ||||||
| (h) | Notification of Transfer | 57 | ||||||
| (i) | Special Indemnification | 57 | ||||||
| (j) | Environmental Matters | 58 | ||||||
| (k) | Marl Demolitions | 58 | ||||||
| (l) | License of Retained Intellectual Property | 59 | ||||||
iii
TABLE OF CONTENTS
(continued)
| Page | ||||||||
| (m) | Seller Guarantees | 59 | ||||||
| (n) | Transaction Services | 60 | ||||||
| (o) | Oberhausen Hereditary Building Right | 60 | ||||||
| 7. | Conditions to Obligation to Close | 60 | ||||||
| (a) | Conditions to Buyer’s Obligation | 60 | ||||||
| (b) | Conditions to Sellers’ Obligation | 62 | ||||||
| 8. | Remedies for Breaches of this Agreement | 63 | ||||||
| (a) | Survival of Representations and Warranties | 63 | ||||||
| (b) | Indemnification by Sellers | 64 | ||||||
| (c) | Indemnification by Buyer | 64 | ||||||
| (d) | Indemnification Procedures | 64 | ||||||
| (e) | Limitations | 65 | ||||||
| (f) | Duty to Mitigate | 66 | ||||||
| (g) | Exclusive Remedy | 66 | ||||||
| 9. | Environmental Indemnity | 67 | ||||||
| (a) | Indemnification by Sellers | 67 | ||||||
| (b) | Indemnification by Buyer | 67 | ||||||
| (c) | Survival | 68 | ||||||
| (d) | Limitations on Duty to Indemnify | 68 | ||||||
| (e) | Cost-Sharing | 70 | ||||||
| (f) | Procedures | 72 | ||||||
| (g) | Assignment | 73 | ||||||
iv
TABLE OF CONTENTS
(continued)
| Page | ||||||||
| (h) | Exclusive Remedy | 73 | ||||||
| 10. | Termination | 73 | ||||||
| (a) | Termination of Agreement | 73 | ||||||
| (b) | Effect of Termination | 74 | ||||||
| 11. | Miscellaneous | 74 | ||||||
| (a) | Press Releases and Public Announcements | 74 | ||||||
| (b) | No Third-Party Beneficiaries | 74 | ||||||
| (c) | Entire Agreement | 74 | ||||||
| (d) | Succession and Assignment | 74 | ||||||
| (e) | Counterparts | 75 | ||||||
| (f) | Headings | 75 | ||||||
| (g) | Notices | 75 | ||||||
| (h) | Governing Law; Arbitration | 76 | ||||||
| (i) | Amendments and Waivers | 77 | ||||||
| (j) | Severability | 77 | ||||||
| (k) | Construction | 77 | ||||||
| (l) | Incorporation of Exhibits, Annexes, and Schedules | 78 | ||||||
| (m) | Specific Performance | 78 | ||||||
| (n) | Limitation on Damages | 78 | ||||||
| (o) | Bulk Transfer Laws | 79 | ||||||
| (p) | Parent Guarantee | 79 | ||||||
v
List of Schedules
| Schedule No. | Name of Schedule | |
| 1(a) | Products |
|
| 1(b) | Company Real Property |
|
| 1(c) | Seller Real Property |
|
| 1(d) | Leased Real Property |
|
| 1(e) | Relevant Competition Authority Jurisdictions |
|
| 1(f) | German Contracts |
|
| 1(g)-1 | United States Tangible Personal Property |
|
| 1(g)-2 | German Tangible Personal Property |
|
| 1(h) | German Transferable Permits |
|
| 1(i) | Estech Assets |
|
| 2(b) | Specified Excluded Assets |
|
| 2(c)(ii) | Specified Excluded Liabilities |
|
| 2(d)(ii) | Amounts Subtracted from Working Capital Adjustments |
|
| 2(e) | Purchase Price Allocation |
|
| 2(h) | Pre-Closing IT Separation Tasks |
|
| 3(b) | Required Governmental Approvals |
|
| 3(c) | Required Consents |
|
| 3(d) | Material Contracts |
|
| 3(e) | Employee Matters |
|
| 3(f) | Litigation |
|
| 3(g) | Compliance with Laws |
|
| 3(h) | Material Permits |
|
| 3(i) | Environmental Matters |
|
| 3(k) | Sufficiency of Purchased Assets |
|
| 3(l)(i) | Transferred Intellectual Property |
|
| 3(l)(ii) | Ownership of and Rights to Transferred Technology and Transferred Intellectual Property |
|
| 3(l)(iii) | Infringement Matters |
|
| 3(l)(vi) | Licenses |
|
| 3(s) | Top Customers and Suppliers |
|
| 3(t) | Product Warranty and Liability |
|
| 6(b) | Employee Transfer Procedures |
|
| 6(c)(iv) | Non-Hire Employees |
|
| 6(e)(x) | Broker Commissions |
|
| 6(m) | Seller Guarantees |
|
| 6(n) | Sample Transition Services |
|
| 7(a)(ix) | Material Consents |
|
| 7(a)(xiii) | Intercompany Contracts to Survive |
vi
List of Exhibits
| Exhibit | Name of Exhibit | |
A (Section 1) |
Working Capital Adjustment | |
B (Section 1) |
Form of Assignment Agreement | |
C (Section 1) |
Form of Deed (2) | |
D (Section 1) |
Form of FIRPTA Affidavit | |
E |
Form of US Site Services Agreements and German Site Services Agreement | |
F-1 |
Form of Formaldehyde Supply Agreement | |
F-2 |
Form of n-Butanol Supply Agreement | |
F-3 |
Form of Acetic Acid Supply Agreement | |
F-4 |
Form of Acetaldehyde Supply Agreement | |
F-5 |
Form of Formalin Supply Agreement | |
F-6 |
Form of Other Products Supply Agreement | |
F-7 |
Form of Ethylene Supply Agreement | |
G |
Form of Bay City Real Property Lease and Xxxxxx Real Property Lease | |
H |
Form of Site Closure Agreement | |
I |
Joint Defense Agreement | |
J |
Debt Term Sheets | |
K |
Equity Commitment Letter | |
2(g)(vii) |
Transfer Deed |
vii
THIS PURCHASE AGREEMENT (this “Agreement”) is entered into as of December 12, 2006, by
and among ADVENT OXO (CAYMAN) LIMITED, a Cayman Island limited liability company (“Parent
Buyer”), OXO TITAN US CORPORATION, a Delaware corporation (“U.S. Buyer”),
DRACHENFELSSEE 520. V V GMBH, a German limited liability company (“German Holdco”),
DRACHENFELSSEE 521. V V GMBH, a German limited liability company (“German Buyer”), CELANESE
LTD., a Texas limited partnership (“Celanese Ltd.”), TICONA POLYMERS INC., a Delaware
corporation (“Ticona,” and together with Celanese Ltd., “U.S. Seller”), CELANESE
CHEMICALS EUROPE GMBH, a German limited liability company (“German Seller”), and, for
purposes of Sections 3, 6(c), 6(e)(xiv) and 11(p) only, CELANESE CORPORATION, a Delaware
corporation (“Parent”). U.S. Seller and German Seller are collectively referred to herein
as “Sellers” and individually as a “Seller.” Parent Buyer, U.S. Buyer, German
Holdco and German Buyer are collectively referred to herein as “Buyer”. Buyer, U.S.
Seller, German Seller and Parent are collectively referred to herein as the “Parties” and
individually as a “Party.”
1. Definitions.
“AAA Rules” has the meaning set forth in Section 11(h)(ii).
“Accounts Receivable” shall mean all accounts, notes, and other receivables, whether
recorded or unrecorded, that are payable to any Seller or Company with respect to the Business from
unaffiliated third party vendors, which would historically be recorded in financial statements of
such Seller or Company as such in accordance with its historical accounting methods.
“Acquiring Business” has the meaning set forth in Section 6(c)(ii).
“Acquired Person” has the meaning set forth in Section 6(c)(ii).
2
“Acquisition Transaction” has the meaning set forth in Section 5(g)(i).
“Acquired Share Interests” means the Entire Eoxo Interest, the Infraserv Oberhausen
Interest, the Titan GmbH Share and the European Pipeline Interest.
“Advent” means Advent International Corporation.
“Affiliate” of a Person means, with respect to any Person, any other Person that,
directly or indirectly, through one or more intermediaries, Controls, is Controlled by, or is under
common Control with that first Person; provided, however, that with respect to a Seller or a
Company, “Affiliate” shall not include the Blackstone Group or any Person under common
Control with a Seller or a Company which would be an Affiliate of such Seller or such Company
solely by reason of its being Controlled by the Blackstone Group.
“Agreement” has the meaning set forth in the preface above.
“Ancillary Agreements” means the following agreements to be entered into between Buyer
and one or more Sellers or their Affiliates as of the Closing:
(a) XX Xxxx Xxxxxxxx Xxxxxxxxx xxx Xxx Xxxx, Xxxxx, XX Site Services Agreement for Xxxxxx,
Texas, and German Site Services Agreement substantially in the form attached as Exhibit E;
(b) Supply Agreement for Formaldehyde, substantially in the form attached as Exhibit
F-1;
(c) Supply Agreement for n-Butanol, substantially in the form attached as Exhibit F-2;
(d) Supply Agreement for Acetic Acid, substantially in the form attached as Exhibit
F-3;
(e) Supply Agreement for Acetaldehyde, substantially in the form attached as Exhibit
F-4;
(f) Supply Agreement for Formalin, substantially in the form attached as Exhibit F-5;
(g) Supply Agreement for Other Products, substantially in the form attached as Exhibit
F-6;
(h) Ethylene Supply Agreement, substantially in the form attached as Exhibit F-7;
(i) Real Property Lease for certain portions of Bay City, Texas site, substantially in the
form attached as Exhibit G;
(j) Real Property Lease for certain portions of Bishop, Texas site, substantially in the form
attached as Exhibit H;
3
(k) Site Closure Agreement, substantially in the form attached as Exhibit I;
(l) Transition Services Agreement, in a form reasonably acceptable to Buyer and Sellers and
containing the terms specified in Section 6(n); and
(m) Joint Defense Agreement, substantially in the form attached as Exhibit J.
“Ancillary Shares” means the Xxx-Xxxxxxxxxx GmbH Share and the Studiengesellschaft mbH
Share.
“Applicable Multiple and Metric” has the meaning set forth in Section 6(c)(iii).
“Asbestos Claims” means any Claims arising out of or relating to personal physical or
bodily injury (including asbestosis, silicosis, lung cancer, mesothelioma and other injuries)
related to exposure to asbestos, asbestos-containing products or materials, silica,
silica-containing products or materials, mixed dust, gases, vapors or other substances.
“Assignment Agreement” means the Xxxx of Sale, Assignment and Assumption Agreement
attached hereto as Exhibit B.
“Assumed Liabilities” has the meaning set forth in Section 2(c)(i).
“Base Amount” has the meaning set forth in Section 2(d)(ii).
“Business” has the meaning set forth in the preface above.
“Business Day” means any day other than a Saturday, Sunday or a day on which banks in
New York, New York or Frankfurt, Germany are authorized or obligated by applicable law or executive
order to close or are otherwise generally closed.
“Buyer” has the meaning set forth in the preface above.
“Buyer Indemnified Parties” has the meaning set forth in Section 6(e)(i).
“Claim” means any and all Liabilities, losses, damages, deficiencies, demands, claims,
fines, penalties, interest, assessments, judgments, Liens, charges, orders, decrees, rulings, dues,
assessments, Taxes, actions, injunctions, proceedings and suits of whatever kind and nature and all
costs and expenses relating thereto, including fees and expenses of counsel, accountants and other
experts, and other expenses of investigation and litigation.
“Closing” has the meaning set forth in Section 2(f).
“Closing Date” has the meaning set forth in Section 2(f).
“Closing Date Statement” has the meaning set forth in Section 2(d)(iii).
“Closing Payment” has the meaning set forth in Section 2(d)(ii).
4
“Code” means the Internal Revenue Code of 1986, as amended.
“Commitment Letters” has the meaning set forth in Section 4(e)(iii).
“Company” means Infraserv Oberhausen, Titan GmbH or Eoxo, and “Companies”
means Infraserv Oberhausen, Titan GmbH and Eoxo.
“Company Employees” means all Employees who are employed by any of the Companies or
their respective subsidiaries.
“Company Facilities” means the chemical manufacturing facilities of each Company
located on, and together with, the Company Real Property or Leased Real Property.
“Company Personal Property” means all tangible personal property owned by each Company
(including all machinery and equipment, mobile or otherwise, vehicles, tools, furniture,
furnishings, Rhodium and Inventory) located on the Company Sites as of the date of this Agreement,
except for the Excluded Assets.
“Company Plans” has the meaning set forth in Section 3(e)(i).
“Company Real Property” means those certain parcels of real property and the buildings
thereon as described in Schedule 1(b), together with all hereditary building rights listed
on Schedule 1(b) and fixtures thereto, but subject to those exceptions listed in
Schedule 1(b).
“Company Site” means (i) with respect to a given Company Facility, the Company Real
Property or Leased Real Property forming a part of, or used or usable in connection with the
Company Facility, and (ii) the Infraserv Oberhausen Site.
“Confidential Information” has the meaning set forth in Section 6(c)(v).
“Confidentiality Agreement” means that certain Confidentiality Agreement, dated as of
August 24, 2006, between Buyer and Parent.
“Contract” means any agreement, contract, obligation, promise, or undertaking, whether
written or oral and whether express or implied, that is legally binding, including, but not limited
to, the agreements related to the portion of the Business located in Germany that are listed on
Schedule 1(f).
“Control” means the power to direct, or cause the direction of, directly or
indirectly, the management or policies of the specified Person, whether through the ownership of
more than 50% of the voting equity ownership of such Person (or securities convertible or
exchangeable into more than 50% of such voting equity ownership interest), by contract or
otherwise.
“Debt Term Sheet” has the meaning set forth in Section 4(e)(ii).
“Debt Financing” has the meaning set forth in Section 4(e)(ii).
5
“Deeds” means special warranty deeds in the form attached hereto as Exhibit C
with respect to each parcel of Real Property included in the Purchased Assets.
“Deutsche Bank Liens” means the security interests and mortgages in and over certain
of the Purchased Assets in favor of Deutsche Bank AG, New York Bank, as administrative agent, under
that certain Credit Agreement, amended and restated as of January 26, 2005.
“Degussa” means Degussa AG, a stock corporation under German law.
“Degussa Interest” means the 50% of the outstanding nominal share capital of Eoxo
owned by OXENO Olefinchemie GmbH, a German limited liability company which is wholly owned by
Degussa.
“Disposal Sites” shall have the meaning provided in Section 9(a)(iv).
“Employees” means the employees of Sellers and the Companies engaged exclusively or
primarily in the Business and employees transferring pursuant to §613a BGB as a result of the
transactions contemplated hereby.
“Employee Benefit Plan” means each employment, bonus, deferred compensation, incentive
compensation, stock purchase, stock option, stock appreciation right or other stock-based
incentive, severance, salary continuation, retention, change-in-control, or termination pay,
hospitalization or other medical, welfare benefits, disability, life or other insurance,
supplemental unemployment benefits, profit-sharing, pension, or retirement plan, program, agreement
or arrangement and each other employee benefit plan, program, agreement or arrangement sponsored,
maintained or contributed to or required to be contributed to by any Person for the benefit of
Employees.
“Employment Agreement” means a Contract of either Seller, any Company or any of their
respective Affiliates with or addressed to any current or former Employee pursuant to which any
Person has any actual or contingent liability or obligation to provide compensation and/or benefits
in consideration for past, present or future services.
“Entire Eoxo Interest” has the meaning set forth in the preface and as described in
detail in Section 2(a)(ix).
“Environment” means soil, land surface or subsurface strata, waters (including
navigable ocean, stream, pond, reservoirs, drainage, basins, wetland, ground and drinking),
sediments, ambient air (including indoor), noise, plant life, human life, animal life and all other
environmental media or natural resources.
“Environmental Conditions” means the presence in or Release to the Environment of
Hazardous Substances, including any migration of those Hazardous Substances through air, soil or
groundwater to or from the Sites, regardless of when such release or other event occurred or is
discovered.
6
“Environmental Laws” means any applicable federal, state, local or foreign statutes,
laws, regulations, ordinances or other legal requirements (including common law) relating to public
or employee health and safety, pollution or protection of the Environment, including those relating
to the manufacture, use, storage, handling, transportation, treatment, disposal, spill, discharge
or other Release to the Environment of Hazardous Substances.
“Eoxo” has the meaning set forth in the preface above.
“Eoxo License” means the License and Know-How Agreement dated October 1, 2003 among
German Seller, Degussa and Eoxo, as amended.
“Eoxo Transaction” means the proposed acquisition by German Seller or its designated
Affiliate of the Degussa Interest.
“Equity Commitment Letter” has the meaning set forth in Section 4(e)(iii).
“Estech Assets” means the equipment listed on Schedule 1(i).
“Estimated Purchase Price” has the meaning given such term in Section 2(d)(ii).
“Estimated Working Capital” has the meaning given such term in Section 2(d)(i).
“Estimated Working Capital Adjustment” has the meaning set forth in Exhibit A.
“European Employees” has the meaning set forth in Section 6(b).
“European Pipeline” has the meaning set forth in the preface above.
“European Pipeline Interest” has the meaning set forth in the preface above.
“Excluded Assets” has the meaning set forth in Section 2(b).
“Excluded Environmental Liabilities” shall mean any Claims or Liabilities related to
Former Sites, Historic Use Contamination and Disposal Sites.
“Excluded Liabilities” has the meaning set forth in Section 2(c)(ii).
“Excluded Products” means n-butyl acetate, i-butyl acetate, hi purity n-propanol,
methyl amines, butyric acid and propionic acid.
“Facilities” means the Seller Facilities and the Company Facilities.
“Fifty Percent Eoxo Interest” has the meaning set forth in the preface above.
“Final Closing Date Statement” has the meaning set forth in Section 2(d)(v).
“Final Purchase Price” has the meaning set forth in Section 2(d)(vii).
7
“Final Specified Deductions” means the sum of the actual amount of the aggregate
pension provisions line item, Estech remnant costs (Oberhausen) line item and real estate transfer
tax (Infraserv) line item listed on Schedule 2(d)(ii), as determined pursuant to the
process set forth in Section 2(d).
“Final Working Capital” has the meaning set forth in Section 2(d)(v).
“Final Working Capital Adjustment” has the meaning set forth in Exhibit A.
“FIRPTA Affidavit” means the affidavit to be delivered by U.S. Seller at the Closing
pursuant to Section 1445(b)(2) of the Code, to establish that U.S. Seller is not a “foreign
person” within the meaning of that Section, a copy of the form of which is attached hereto as
Exhibit D.
“Former Sites” has the meaning set forth in Section 9(a)(iv).
“German Buyer” has the meaning set forth in the preface above.
“German Employees” means Company Employees and employees transferring pursuant to
§613a BGB as a result of the transactions contemplated hereby.
“German Holdco” has the meaning set forth in the preface above.
“German Pension Schemes” has the meaning set forth in Section 3(e)(ix).
“German Seller” has the meaning set forth in the preface above.
“German VAT Act” means the German Value Added Tax Act (Umsatzsteuergesetz).
“Governmental Entity” means any European, national, state, regional, county,
municipal, local or foreign court, arbitral tribunal, agency, board, bureau or commission or other
governmental or other regulatory authority or instrumentality.
“Hazardous Substances” means any material, substance or waste classified,
characterized, regulated or treated as “hazardous,” “toxic,” “radioactive”
or a “pollutant” or “contaminant” under Environmental Laws or which may be alleged
to cause harm to people or the Environment, including, but not limited to, petroleum or oil,
hazardous materials or wastes, air emissions, hazardous or toxic substances, wastewater discharges,
asbestos and any chemical, material or substance, the presence of which requires investigation or
Remediation under applicable Environmental Laws.
“Historic Use Contamination” has the meaning set forth in Section 9(a)(i).
“Indemnification Cap” has the meaning set forth in Section 8(e).
“Indemnification Threshold” has the meaning set forth in Section 8(e).
“Indemnified Party” has the meaning set forth in Section 8(d)(i).
8
“Indemnifying Party” has the meaning set forth in Section 8(d)(i).
“Indemnity Notice” has the meaning set forth in Section 8(d)(vi).
“Infraserv Oberhausen” has the meaning set forth in the preface above.
“Infraserv Oberhausen Interest” has the meaning set forth in the preface above and as
described in detail in Section 2(a)(ix).
“Infraserv Oberhausen Site” means the industrial site managed by Infraserv Oberhausen
and located in Oberhausen, Germany.
“Initial Closing Date Statement” has the meaning set forth in Section 2(d)(i).
“Intellectual Property” means domain names and any rights available (including with
respect to Technology), under patent, trademark, service xxxx, utility model, copyright or trade
secret law or any other statutory provision or common law doctrine in the United States, Germany or
other country, irrespective of whether such rights are registered, and including without
limitation, utilization rights. For avoidance of doubt, Intellectual Property shall include all
design rights (“Gebrauchsmuster”) available under German law.
“Inventory” means inventories of raw materials, feedstocks, work-in-process,
consumable supplies and chemicals (other than Products) located at the Facilities or ordered by the
Facilities in the Ordinary Course of Business for use in the manufacture of Products, the finished
product inventory of Products located at the Sites, and any of the foregoing located at any third
party warehouse or storage location, which would historically be recorded in financial statements
of Sellers or the Companies as such in accordance with their historical accounting methods.
“IRS” means the United States Internal Revenue Service and, to the extent relevant,
the United States Department of Treasury.
“Joint Defense Agreement” means the Joint Defense Agreement described in the
definition of “Ancillary Agreements.”
“Know-How” means proprietary trade secrets, formulae, invention records,
specifications, quality control procedures, manufacturing processes and other know-how.
“Knowledge of Sellers,” “Sellers’ Knowledge,” and similar phrases mean the
actual knowledge, after due inquiry, of (i) with respect to all matters, Xxx Xxxxxxxx, Xxxx
Xxxxxxxxxxxx, Xxxxxxx Xxxxx and Xxxxxx X. Xxxx, (ii) with respect to matters relating to the
Business conducted in Bay City, Texas, Xxxxxxxxx X. Xxxxxx, (iii) with respect to matters relating
to the Business conducted in Xxxxxx, Texas, Xxxx Xxxxx, (iv) with respect to matters relating to
the Business conducted in Germany, Xxxxx Xxxxxxxxx, (v) with respect to matters relating to the
Environment, Xxxx Xxxxx, and (vi) with respect to matters relating to Contracts, Xxxxxxx Xxxx and
Xxxxxxx Xxxxx Xxxxx.
9
“Liability” means any debt, liability or obligation (whether known or unknown, whether
absolute or contingent, whether liquidated or unliquidated, and whether due or to become due).
“Leased Real Property” means those certain parcels of real property and the buildings
thereon as described in Schedule 1(d).
“Lenders” has the meaning set forth in Section 4(e)(ii).
“Licensed Know-How” has the meaning set forth in Section 6(l).
“Licensed Patent” has the meaning set forth in Section 6(l).
“Lien” means any mortgage, pledge, lien, charge, security interest or other
encumbrance of any kind or character, including any obligation to sell or transfer to a third
party; provided that the following shall not be considered a Lien for purposes of this Agreement:
(a) all rights to consent by, required notices to, filings with or other actions by, Governmental
Entities in connection with the sale of any Purchased Assets to the extent such consents are
customary after Closing; (b) any required third-party consents to assignment and similar agreements
and obligations with respect to which, prior to the Closing: (i) waivers or consents have been
obtained from the appropriate party, (ii) the applicable period of time for asserting such rights
has expired without any exercise of such rights, or (iii) arrangements reasonably satisfactory to
Buyer have been made to allow Buyer to receive substantially the same economic benefits as if all
such waivers and consents had been obtained; and (c) restrictions on transfer contained in any
Contracts included in the Purchased Assets.
“Material Adverse Effect” or “Material Adverse Change” means:
(a) with respect to Sellers, any effect or change that would be materially adverse to (i) the
assets, liabilities, results of operations, business or condition (financial or otherwise) of the
Business taken as a whole, except any such effect resulting from or arising in connection with (A)
the execution or announcement of this Agreement, or (B) any change in the financial markets or
general economic conditions generally affecting the industry in which the Business operates, or
(ii) the ability of Sellers to consummate timely the transactions contemplated hereby; and
(b) with respect to Buyer, any effect or change that would be materially adverse to the
ability of Buyer to consummate timely the transactions contemplated hereby.
“Material Contracts” means, collectively, all of the Contracts listed on Schedule
3(d) and any Employment Agreement listed on Schedule 3(e).
“Material Environmental Permits” has the meaning set forth in Section 3(h).
“Material Permits” means all of the Permits listed on Schedule 3(h).
“Material Consents” has the meaning set forth in Section 7(a)(ix).
10
“Measurement Year” has the meaning set forth in Section 2(d)(ix).
“Xxx-Xxxxxxxxxx GmbH” has the meaning set forth in the preface above.
“Xxx-Xxxxxxxxxx GmbH Share” has the meaning set forth in the preface above, namely the
share in the nominal amount of €6,390 in Xxx-Xxxxxxxxxx GmbH held by German Seller.
“Oberhausen Assets” means those Purchased Assets associated with the Business
conducted by German Seller at the Seller Facility in Oberhausen, Germany.
“Ordinary Course of Business” means the ordinary course of business of the Sellers and
the Companies with respect to the Business consistent with past custom and practice (including with
respect to quantity and frequency).
“Parent” has the meaning set forth in the preface above.
“Parent Buyer” has the meaning set forth in the preface above.
“Party” has the meaning set forth in the preface above.
“Permits” means all certificates, licenses, permits, approvals and consents of a
Governmental Entity pertaining to a particular Purchased Asset or required for the lawful operation
of the Business as currently conducted.
“Permitted Liens” means, with respect to all Purchased Assets other than Acquired
Share Interests: (a) Liens for Taxes and other governmental charges and assessments which are not
yet due and payable or are being contested in good faith in accordance with applicable law; (b)
zoning, building and land use laws, ordinances, orders, decrees, restrictions and conditions
imposed by any Governmental Entity, provided no such laws are being violated in any material
respect by the current use of the Purchased Asset subject thereto; (c) other imperfections of title
or encumbrances with respect to the Purchased Assets which arise in the Ordinary Course of Business
and do not materially detract from the value of or materially and adversely interfere with the
present use of the Purchased Assets subject thereto or affected thereby; (d) purchase money Liens
disclosed to Buyer (except as to Real Property) and Liens securing rental payments under lease
arrangements; (e) easements, rights-of-way, servitudes, permits, mineral rights previously conveyed
to third parties, surface leases and other rights with respect to surface obligations, including
without limitation, pipelines, grazing, canals, ditches, reservoirs, or the like, conditions,
covenants or other restrictions, and easements of or for streets, alleys, highways, pipelines,
telephone lines, power lines, railways, and any other easements and rights-of-way on, over or in
respect of any of the Purchased Assets, and similar matters of record to the extent set forth in
any title commitment report or policy applicable to any of the Purchased Assets that has been made
available to Buyer, provided none of which materially interfere with the use of the Seller
Facilities, as applicable, or in the manufacture of the Products as presently conducted; (f) Liens
incurred in the Ordinary Course of Business in respect of pledges or deposits under workers’
compensation laws or similar legislation, carriers, landlord’s, workmen’s, warehousemen’s,
mechanics, laborer’s, materialmen’s or other similar Liens, if the obligations
11
secured by such Liens are Assumed Liabilities and are not delinquent; and (g) the Deutsche
Bank Liens, subject to the delivery of a release and discharge of the Deutsche Bank Liens at the
Closing. With respect to Acquired Share Interests and Ancillary Shares, there shall be no Permitted
Liens.
“Person” means an individual, a partnership, a corporation, a limited liability
company, an association, a joint stock company, a trust, a joint venture, an unincorporated
organization, any other business entity or a Governmental Entity (or any department, agency, or
political subdivision thereof).
“Pre-Closing Business Related Contamination” has the meaning set forth in Section
9(a)(ii).
“Pre-Closing Closures” has the meaning set forth in Section 6(j)(iv).
“Products” means the products listed on Schedule 1(a).
“Purchased Assets” has the meaning set forth in Section 2(a).
“RCRA” has the meaning set forth in Section 6(j)(i).
“Real Property” means the Seller Real Property and the Company Real Property.
“Records” means all books, books of account, engineering plans, designs, documents,
drawings and similar record-keeping materials, regardless of the type of medium on which stored,
excluding same to the extent comprising, containing or relating to the Excluded Assets.
“Referral Firm” has the meaning set forth in Section 2(d)(v).
“Release” means release, spill, leak, discharge, dispose of, pump, pour, emit, empty,
inject, xxxxx, dump or allow to escape into the Environment.
“Relevant Competition Authorities” means (i) the relevant Governmental Entity in each
jurisdiction listed on Schedule 1(e) with legal authority to make a decision pursuant to
antitrust, competition or similar laws granting or refusing to consent to any merger or acquisition
falling within its jurisdiction and within whose jurisdiction the acquisition of all or part of the
Purchased Assets by Buyer actually falls, and (ii) the relevant Governmental Entity in each
jurisdiction in which additional mandatory filings may be required in connection with the
acquisition of all or part of the Purchased Assets by Buyer by reason of a change in legislation
after the date of this Agreement.
“Remediation” means any or all of the following activities to the extent they relate
to or arise from the presence of Hazardous Substances at a Site: (a) monitoring, investigation,
assessment, treatment, cleanup, containment, removal, mitigation, response or restoration work; (b)
obtaining any permits, consents, approvals or authorizations of any Governmental Entity necessary
to conduct any such activity; (c) preparing and implementing any plans or studies for
12
any such activity; (d) obtaining a written notice from a Governmental Entity with jurisdiction
over the Sites under Environmental Laws that no additional work is required by such Governmental
Entity; (e) obtaining a written opinion of state law requirements; and (f) any other activities
reasonably determined by a Party to be necessary or appropriate or required under Environmental
Laws to address the presence of Hazardous Substances at the Sites.
“Representatives” has the meaning set forth in Section 5(g)(i).
“Restricted Activity” has the meaning set forth in Section 6(c)(i).
“Restricted Business” has the meaning set forth in Section 6(c)(iii).
“Restricted Period” has the meaning set forth in Section 6(c)(i).
“RWE Contract” means the Contract to be dated as of January 1, 2007 between German
Seller and RWE Energie AG with respect to the supply of electricity to the Seller Facility in
Oberhausen, Germany, which Contract has been executed by RWE Energie AG and which Contract German
Seller shall execute on or before Closing.
“Seller” has the meaning set forth in the preface above.
“Seller Employees” means all Employees who are not German Employees or European
Employees.
“Seller Facilities” means the chemical manufacturing facilities of Sellers located on,
and together with, the Seller Real Property or the Leased Real Property.
“Seller Guarantees” has the meaning set forth in Section 6(l).
“Seller Indemnified Parties” has the meaning set forth in Section 8(c).
“Seller Personal Property” means all tangible personal property owned by Sellers
(including all machinery and equipment, mobile or otherwise, vehicles, tools, furniture,
furnishings, Rhodium and Inventory) located on the Seller Sites as of the date of this Agreement,
except for the Excluded Assets, and including, but not limited to, the tangible personal property
related to the portion of the Business located in the United States that is listed in Schedule
1(g)-1 and the tangible personal property related to the portion of the Business located in
Germany that is listed in Schedule 1(g)-2.
“Seller Plans” has the meaning set forth in Section 3(e)(i).
“Seller Real Property” means those certain parcels of real property and the buildings
thereon as described in Schedule 1(c), together with all fixtures thereto, but subject to
those exceptions listed in Schedule 1(c).
13
“Seller Site” means, with respect to a given Seller Facility, the Seller Real
Property or Leased Real Property forming a part of, or used or usable in connection with the Seller
Facility.
“Seller Taxes” has the meaning set forth in Section 2(c)(ii)(E).
“Sites” mean the Seller Sites and the Company Sites. Any reference to a Site shall
include, by definition, the surface and subsurface elements, including the soils and groundwater
present at the Site, and any reference to items “at the Site” shall include items “at, on, in,
upon, over, across, under and within” the Site.
“Software” means any and all computer programs, whether in source code or object code,
that can be transferred without impairment to Sellers’ rights in their respective businesses (other
than the Business); databases and compilations, whether machine readable or otherwise;
descriptions, flow-charts and other work product used to design, plan, organize and develop any of
the foregoing; and all documentation including user manuals and other training documentation
related to any of the foregoing.
“Straddle Tax Period” shall mean any taxable period of any Company that includes the
Closing Date (but does not begin or end on the Closing Date).
“Studiengesellschaft mbH” has the meaning set forth in the preface above.
“Studiengesellschaft mbH Share” has the meaning set forth in the preface above, namely
the share in the nominal amount of €1,636.13 in Studiengesellschaft mbH held by German Seller.
“Subsidiary” means, with respect to any Person, any corporation, limited liability
company, partnership, association or other business entity of which:
(a) if a corporation, a majority of the total voting power of shares of stock entitled
(without regard to the occurrence of any contingency) to vote in the election of directors,
managers or trustees thereof is at the time owned or controlled, directly or indirectly, by that
Person or one or more of the other Subsidiaries of that Person or a combination thereof; or
(b) if a limited liability company, partnership, association or other business entity (other
than a corporation), a majority of partnership or other similar ownership interests thereof is at
the time owned or controlled, directly or indirectly, by that Person or one or more Subsidiaries of
that Person or a combination thereof and for this purpose, a Person or Persons owns a majority
ownership interest in such a business entity (other than a corporation) if such Person or Persons
shall be allocated a majority of such business entity’s gains or losses or shall be or control a
majority of the managers or general partners of such business entity (other than a corporation).
The term “Subsidiary” shall include all Subsidiaries of such Subsidiary.
“Tax” means (i) any federal, state, local or foreign income, gross receipts, license,
payroll, employment, corporate, trade, excise, severance, stamp, occupation, premium, windfall
profits, environmental, customs, duties, capital stock, franchise, profits, withholding, social
14
security (or similar), unemployment, disability, real property, personal property, sales, use,
transfer (including real property transfer), registration, value added, alternative or add-on
minimum, estimated, or other tax of any kind whatsoever, (ii) any interest, penalty, or
addition thereto, any liability in respect of any items described in clauses (i) or (ii) payable by
reason of contract, assumption, transferee liability, operation of law, Treasury Regulations
section 1.1502-6(a) (or any predecessor or successor thereof of any analogous or similar provision
under state, local or foreign law) or otherwise.
“Tax Claim” has the meaning set forth in Section 6(e)(viii).
“Tax Return” means any return or report (including any election, declaration,
disclosure, schedule, estimate and information return and any amendments to the foregoing) required
to be supplied to a Governmental Entity relating to Taxes, including any claim for refund, amended
return or declaration of estimated Tax, and including, where permitted or required, combined,
consolidated or unitary returns for any group of entities that includes any Company, any of its
Subsidiaries, or any of their Affiliates.
“Tax Sharing Agreement” shall mean any Tax sharing, allocation, indemnity or similar
agreement or arrangement (whether or not written) pursuant to which any Company or, with respect to
the Purchased Assets, any Seller could have any obligation to make any payments of or in respect of
Taxes after the Closing.
“Taxing Authority” shall mean a Governmental Entity having jurisdiction over the
assessment, determination, collection, or other imposition of any Tax.
“Technology” means, collectively, designs, formulae, methods, techniques, ideas, data,
improvements, inventions, Software and other similar materials, and all recordings, graphs,
drawings, reports, analyses, and Know-How and other writings, and any other embodiments of the
above, in any form whether or not specifically listed herein, and all related technology, that are
used, incorporated or embodied in or displayed by any of the foregoing or used in the design,
development, reproduction, sale, marketing, maintenance or modification of any of the foregoing.
“Third Party Claim” has the meaning set forth in Section 8(d)(i).
“Ticona/Infraserv Lease” means the Lease Agreement (Pachtvertrag) dated
October 26 and 27, 1998 between and among Infraserv and Ticona GmbH relating to certain
commercially used land and buildings amending the Lease Agreement (Pachtvertrag) dated May 30, 1997
between and among Infraserv and Hoechst AG relating to certain commercially used land and
buildings.
“Titan GmbH” has the meaning set forth in the preface above.
“Titan GmbH Share” has the meaning set forth in the preface above and as described in
detail in Section 2(a)(ix).
15
“Transferable Permits” means those Permits which are transferable by a Seller to Buyer
by assignment, by operation of law, or as a consequence of Buyer’s being the successor in title to
a Facility including, but not limited to, those permits related to the portion of the Business
located in Germany that are listed on Schedule 1(h).
“Transferred Intellectual Property” means all Intellectual Property used or held for
use in connection with (a) the Business, (b) the features, manufacturing, distribution, storage,
marketing, sale or deployment of the Products or any intermediate product thereto and (c) technical
knowledge as invented or developed until the Closing Date.
“Transferred Technology” means all Technology used or held for use in connection with
(a) the Business, and (b) the features, manufacturing, distribution, storage, marketing, sale or
deployment of the Products. Notwithstanding the foregoing, Transferred Technology shall exclude any
Know-How that is not used or held for use primarily in connection with the Business or the Products
(“Retained Know-How”).
“Treasury Regulations” means the United States Treasury Regulations promulgated under
the Code, as amended.
“U.S. Buyer” has the meaning set forth in the preface above.
“U.S. Seller” has the meaning set forth in the preface above.
“VAT” means the value added tax as provided for under the German VAT Act.
“Vendor Due Diligence Report” has the meaning set forth in Section 2(h)(ii).
“Vendor Tax Due Diligence” means the vendor tax due diligence reports prepared by
Ernst & Young dated September 20, 2006 with respect to U.S. Seller and September 28, 2006 with
respect to the Companies.
“Working Capital” has the meaning set forth in Exhibit A.
(a) Purchase of Assets. On and subject to the terms and conditions of this Agreement,
Buyer agrees to purchase from Sellers, and Sellers agree to sell (and cause any Affiliate of any
Seller that owns any Purchased Asset to sell) to Buyer, for the consideration specified below in
this Section 2, the Ancillary Shares, the Estech Assets as well as the following assets of Sellers
(the following assets collectively, but not including the Ancillary Shares or the Estech Assets,
the “Purchased Assets”):
(i) Seller Facilities and Seller Real Property. The Seller Facilities and the Seller
Real Property including, but not limited to, the Seller Real Property described in the sale and
transfer agreement attached hereto as Exhibit 2(a)(i) which will be executed at the
Closing;
16
(ii) Seller Personal Property. The Seller Personal Property;
(iii) Transferable Permits. The Transferable Permits;
(iv) Accounts Receivable and Inventory. The Accounts Receivable and Inventory;
(v) Contracts. The Material Contracts to which either Seller is a party, the other
Contracts entered into by either Seller or its Affiliate with customers of or suppliers to any
Seller Facility in the Ordinary Course of Business and related exclusively or primarily to the
operation of such Seller Facility, and each Contract (including any guaranty) relating to or
binding upon any Acquired Share Interest or Ancillary Shares or the holders thereof. With respect
to each Contract included in the Purchased Assets, such Contract shall be assigned to and assumed
by Buyer through the novation of such Contract between Buyer and the other party or parties to such
Contract, to the extent Buyer and Sellers can obtain the consent of such other party or parties to
such novation. Regardless of whether such other party or parties agree to such novation, as
between Buyer and Sellers, the Parties shall treat each other as if each such Contract had been
assigned under full release of Sellers and any Affiliate of Sellers party to such Contract. To the
extent that a Contract is not assignable without the consent of the other party or parties thereto
and if such consent is not obtained prior to the Closing Date, Buyer and each Seller shall (and
Sellers shall cause any applicable Affiliate of Seller to) enter, at its own respective expense
except as noted below, into any lawful arrangement mutually agreeable to Buyer and Sellers to
assist Buyer to obtain all right, title and interest in, and to assume all obligations under, the
Contract with respect to which the consent has not been obtained in accordance with this Agreement.
Such reasonable arrangement may include (A) the subcontracting, sublicensing or subleasing to
Buyer of any and all rights and obligations of the applicable Seller under the third-party Contract
including, without, limitation, any rights arising out of a breach or cancellation thereof by such
third party, and (B) the enforcement by such Seller of such rights at the cost and for the benefit
of Buyer. In addition, certain Material Contracts that relate both to the Purchased Assets and to
the Excluded Assets, as more particularly described on Schedule 3(d), will be retained by
Sellers but Buyer and Sellers shall enter into a mutually satisfactory arrangement pursuant to
which Buyer receives a proportionate amount of the benefits under such Material Contract related to
the Purchased Assets, and assumes a proportionate amount of the obligations under such Material
Contract related to the Purchased Assets. Sellers shall act as trustee for Buyer in this regard,
shall pass on the full proportionate benefit of such Material Contract to Buyer and shall not
exercise any rights under such Material Contracts which affect the Business without the prior
written consent of Buyer;
(vi) Records. All Records pertaining exclusively or primarily to (i) the ownership
and operation of the Seller Facilities, (ii) the Know-How, and (iii) the Employees (subject in each
case to the right of Sellers to retain copies of same for their use);
(vii) Intellectual Property. All Transferred Intellectual Property;
(viii) Technology. All Transferred Technology; and
17
(ix) Share Interests. The Acquired Share Interests, including (A) the two shares in
the nominal amount of €500,000 each in Eoxo held by German Seller and OXENO Olefinchemie GmbH
respectively, (B) the three limited partnership interests in Infraserv Oberhausen in the amount of
€2,079,453 held by Celanese AG, in the amount of €17,883,292 held by German Seller, and in the
amount of €415,891 held by Ticona GmbH, (C) the only share in Titan GmbH, originally in the nominal
amount of €25,000, held by German Seller, and (D) the European Pipeline Interest.
(x) Oberhausen Assets. All Oberhausen Assets.
(xi) Title Transfer. At the Closing, Sellers shall assign and transfer to Buyer the
Purchased Assets in accordance with Section 2(g)(vii) through (xi); and
(xii) Joint Title/Expectant Right. It is agreed between Buyer and Sellers that in the
event that any Purchased Assets are subject to a retention of title right (Eigentumsvorbehalt), the
respective expectant right (Anwartschaftsrecht) of Sellers is sold and transferred under this
Agreement; in case Sellers only hold joint title (Miteigentum) to a Purchased Asset such joint
title is sold and transferred under this Agreement.
The Purchased Assets will be acquired by Buyer as follows: (A) German Holdco shall acquire the
Entire Eoxo Interest, (B) U.S. Buyer shall acquire the Purchased Assets located in the United
States, and (C) German Buyer shall acquire the Ancillary Shares and all other Purchased Assets.
Parent Buyer may modify such allocation by notifying Sellers prior to Closing. All assets of
Sellers not expressly included in the Purchased Assets shall remain the property of Sellers from
and after the Closing.
(b) Excluded Assets. Notwithstanding anything to the contrary in this Agreement,
nothing in this Agreement will constitute or be construed as conferring on Buyer, and Buyer is not
acquiring, any right, title or interest in or to (x) any properties, assets, business, operation,
or division of Sellers or any Affiliate of Sellers not expressly set forth in Section 2(a), or (y)
the specific assets associated with the Companies or the Purchased Assets, but are specifically
excluded from the sale contemplated hereby and the definition of Purchased Assets herein,
consisting of the following assets (collectively, the “Excluded Assets”):
(i) Excluded Facilities. Sellers’ Affiliate’s n-butyl acetate and i-butyl acetate
production facilities in Singapore, German Seller’s n-butyl acetate, i-butyl acetate and hi purity
n-propanol production facilities in Frankfurt am Main, U.S. Seller’s propionic and butyric acid
production facilities in Pampa, Texas, and all real, personal and intangible property and other
Contracts, rights, interests, licenses and assets associated with such facilities;
(ii) Specified Assets. The real, personal and intangible property and other
Contracts, rights, interests, licenses and assets described on Schedule 2(b), as well as
all Permits, Contracts and warranties, to the extent they relate to the foregoing;
(iii) Cash. All cash and cash equivalents, checkbooks and canceled checks, bank
accounts and deposits (including any such items held by or on behalf of any Company);
18
(iv) Securities. All certificates of deposits, shares of stock, securities, bonds,
debentures, evidences of indebtedness, and interests in joint ventures, partnerships, limited
liability companies and other entities, other than the Acquired Share Interests and the Ancillary
Shares;
(v) Causes of Action. (A) The rights of Sellers in and to any causes of action
against third parties relating specifically to the Purchased Assets for any period prior to and
through the Closing Date, including prepaid expenses, monies held by third parties and loans to
employees, (B) Sellers’ insurance policies, and (C) all claims under Sellers’ insurance policies
whether arising prior to or after the Closing Date, in each of case (A) and (C) above, only to
the extent it relates to an Excluded Liability;
(vi) Names. The rights of Sellers to the names “Celanese,” “Celanese
Ltd.,” “Celanese Chemicals,” “CEL,” and any derivatives thereof, and any and
all trademarks and trade names associated therewith; and
(vii) Personnel Records. All personnel records of Sellers or their Affiliates (other
than the Companies), other than (A) records for the Employees (subject to Section 2(a)(v)), (B)
records the disclosure of which is required by law or subpoena, and (C) records which any Seller is
required by applicable law to retain.
(c) Liabilities.
(i) Assumed Liabilities. At the Closing, subject to the terms and conditions of this
Agreement, including without limitation, Section 9 of this Agreement, Sellers shall assign, and
Buyer shall assume and agree to pay, perform and discharge (x) all of the Claims against and
Liabilities of Sellers with respect to the Business only to the extent arising out of or relating
to the period from and after the Closing, and (y) subject to Section 6(e), all of the Claims
against and Liabilities of the Companies with respect to the Business and with respect to the
Company Sites (whether arising or occurring prior to, on or after the Closing), including, but not
limited to, the following Claims against and Liabilities of Sellers to the extent arising out of or
relating to the period from and after the Closing and the following Claims against and Liabilities
of the Companies whether arising or occurring prior to, on or after the Closing (collectively, the
“Assumed Liabilities”), in any way associated with or related to:
(A) All Claims and Liabilities, including Asbestos Claims, arising out of any allegations of
injury, illness, exposure to Hazardous Substances or workers compensation Claims for Seller
Employees, former Seller Employees, contractors of any Seller, visitors to any Seller Site or any
other people with respect to any Seller Site, based on conditions allegedly existing or exposure
allegedly occurring exclusively after the Closing; provided, however, that responsibility for any
Claims or Liabilities based, in each case, on conditions allegedly existing or exposure allegedly
occurring in part on or prior to Closing and in part after Closing shall be allocated between
Sellers and Buyer in relative proportion to the number of months said conditions or exposure
allegedly occurred on or prior to Closing (which shall be allocated to Sellers) and the number of
months said conditions or exposure allegedly occurred after Closing
19
(which shall be allocated to
Buyer); furthermore, the procedure for the conduct of all Claims and Liabilities described in this
paragraph, including cooperation between Buyer and Sellers, shall be governed by the Joint Defense
Agreement. The determination of when conditions allegedly existed or exposure allegedly occurred
for purposes of allocating liability under this paragraph shall be based on the allegations of the
claimant’s complaint or, if no lawsuit has yet been filed, the allegations of claimant’s settlement
brochure, in which case the liability allocation will be re-determined if and when a lawsuit is
filed based on the allegations of the complaint. Absent allegations in the claimant’s complaint or
settlement brochure as to when conditions allegedly existed or exposure allegedly occurred, Buyer
and Sellers agree to use records relating to the claimant’s employment on the premises of the
subject plant, or if no such records exist for the claimant, then until the seventh anniversary of
the Closing Date, liability shall be allocated 0% to
Buyer and 100% to Sellers until an exposure period can be determined through discovery, at
which time liability will be reallocated between Buyer and Sellers according to exposure as
described above. After the seventh anniversary of the Closing Date, liability shall be allocated
100% to Buyer and 0% to Sellers until an exposure period can be determined through discovery at
which time liability will be reallocated according to exposure as described above. If an exposure
period cannot be determined through discovery, then liability shall be allocated between Buyer and
Sellers based on the year the claimant first gave notice of his or her claim to either Buyer or
Sellers, with Sellers bearing 100% of the liability for claims for which notice is first received
prior to the seventh anniversary of the Closing Date, and Buyer bearing 100% of the liability for
claims for which notice is first received on or after the seventh anniversary of the Closing Date.
(B) Any pension liabilities (except as provided on Schedule 6(b)) and any inventorship
remuneration according to the German law “Arbeitnehmererfindergesetz” for any Seller
Employees and former Seller Employees, who are entitled to receive such remunerations, arising
after the Closing Date;
(C) The Purchased Assets and the business conducted with the Purchased Assets;
(D) Products made, used or sold by Sellers from the Facilities, whether based on breach of
warranty or in negligence, strict liability, tort or otherwise, including obligations and
liabilities for refunds, adjustments, allowances, repairs, exchanges, returns and warranty,
merchantability and other Claims;
(E) Rebates or other amounts payable to any customer by Sellers, any of Sellers’ Affiliates or
the Companies relating to Products sold by Sellers from the Facilities which were ordered prior to
the Closing Date for delivery after the Closing Date, but only to the extent such Liability is
included in Final Working Capital;
(F) The operation and use of the Facilities or the manufacture, marketing and sale of the
Products as and to the extent relating to Transferred Intellectual Property or Transferred
Technology;
20
(G) Taxes of Sellers for which Buyer is liable pursuant to Section 6(e)(v);
(H) Purchase orders issued in the Ordinary Course of Business for any goods, materials or
services for the facility or production of Products;
(I) Obligations to be performed by any Seller or any Affiliate of any Seller under each
Contract included in the Purchased Assets;
(J) The Acquired Share Interests and the Ancillary Shares, including any obligations to be
performed by any Seller or any Affiliate of any Seller under any Contract (including any guaranty)
relating to or binding upon any Acquired Share Interest or the holder thereof;
(K) European or national state aid; and
(L) Obligations of German Seller under the shareholders agreement, indemnification agreement,
subordination deed and related agreements entered into by German Seller with respect to European
Pipeline (including the obligation to provide letters of credit and comfort), as more particularly
described on Schedule 3(d).
(ii) Excluded Liabilities. Except for the Assumed Liabilities, Buyer shall not assume
or become liable for any Liabilities (1) of Parent or its Subsidiaries (other than the Companies)
or Sellers or (2) of the Companies for indebtedness for borrowed money (including factoring
arrangements) or leases required to be capitalized in accordance with historical accounting methods
(collectively, the “Excluded Liabilities”). Excluded Liabilities include, but are not
limited to any and all Liabilities arising out of, related to, or attributable to:
(A) All Claims and Liabilities, including Asbestos Claims, arising out of any allegations of
injury, illness, exposure to Hazardous Substances or workers compensation Claims for Seller
Employees, former Seller Employees, contractors of any Seller, visitors to any Seller Site or any
other people with respect to any Seller Site, based on conditions existing or exposure occurring
exclusively on or prior to the Closing and including any pending litigation relating to Asbestos
Claims; provided, however, that responsibility for any Claims or Liabilities based, in each case,
on conditions allegedly existing or exposure allegedly occurring in part on or prior to Closing and
in part after Closing shall be allocated between Sellers and Buyer in relative proportion to the
number of months said conditions or exposure allegedly occurred on or prior to Closing (which shall
be allocated to Sellers) and the number of months said conditions or exposure allegedly occurred
after Closing (which shall be allocated to Buyer); furthermore, the procedure for the conduct of
all Claims and Liabilities described in this paragraph, including cooperation between Buyer and
Sellers, shall be governed by the Joint Defense Agreement. (By way of clarification, any of the
foregoing with respect to a Company Employee, former Company Employee, contractor of any Company,
visitor to any Company Site or any other person with respect to any Company Site shall be an
Assumed Liability.) The determination of when conditions allegedly existed or exposure allegedly
occurred for purposes of allocating liability under this paragraph shall be based on the
allegations of the claimant’s complaint or, if
21
no lawsuit has yet been filed, the allegations of
claimant’s settlement brochure, in which case the liability allocation will be re-determined if and
when a lawsuit is filed based on the allegations of the complaint. Absent allegations in the
claimant’s complaint or settlement brochure as to when conditions allegedly existed or exposure
allegedly occurred, Buyer and Sellers agree to use records relating to the claimant’s employment on
the premises of the subject plant, or if no such records exist for the claimant, then until the
seventh anniversary of the Closing Date, liability shall be allocated 0% to Buyer and 100% to
Sellers until an exposure period can be determined through discovery, at which time liability will
be reallocated between Buyer and Sellers according to exposure as described above. After the
seventh anniversary of the Closing Date, liability shall be allocated 100% to Buyer and 0% to
Sellers until an exposure period can be determined through discovery at which time liability will
be reallocated according to exposure as described above. If an exposure period cannot be
determined through discovery, then liability shall be allocated between Buyer and Sellers based on
the year the claimant first gave notice of his or her claim to either Buyer or Sellers, with
Sellers bearing 100% of the liability for claims for which notice is first received prior to the
seventh anniversary of the Closing Date, and Buyer
bearing 100% of the liability for claims for which notice is first received on or after the
seventh anniversary of the Closing Date.
(B) Any pension liabilities (except as provided on Schedule 6(b)) and any inventorship
remuneration according to the German law “Arbeitnehmererfindergesetz” for any Seller
Employees and former Seller Employees, who are entitled to receive such remunerations, arising on
or prior to the Closing Date;
(C) Any and all Liabilities relating to (i) indebtedness for money borrowed and other
indebtedness evidenced by notes, debentures, bonds or other similar instruments (which shall
include intercompany indebtedness); (ii) all obligations of Sellers under Contracts that are not
specifically an Assumed Liability; (iii) all obligations of Sellers for the reimbursement of any
obligor on any letter of credit, banker’s acceptance or similar credit transaction; (iv) all
obligations of Sellers under interest rate or currency swap transactions (valued at the termination
value thereof); (v) all obligations of the type referred to in clauses (i) through (iv) of Sellers
for the payment of which Sellers are responsible or liable, directly or indirectly, as obligor,
guarantor, surety or otherwise, including guarantees of such obligations.
(D) Any and all Liabilities of Sellers relating to any pending or threatened litigation or
claim (i) affecting the Purchased Assets or Business from any matter or state of facts existing
prior to the Closing Date whether or not disclosed; (ii) in respect of any product liability or
warranty claim whenever made relating to products sold or services provided by Sellers prior to the
Closing Date; (iii) in respect of any liabilities or claims asserted by any person or entity,
whenever asserted, arising out of the sale of products or services (whether under a theory of
contract, tort or other liability) by Sellers prior to the Closing Date; or (iv) in respect of any
Excluded Asset (by way of clarification, any of the foregoing with respect to a Company or Company
Site shall be an Assumed Liability).
(E) Any and all Liabilities related to the Excluded Assets;
22
(F) Any and all Liabilities relating to Taxes of Sellers, but excluding Taxes for which Buyer
is liable pursuant to Section 6(e)(v) (such non-excluded Taxes, “Seller Taxes”);
(G) Any and all Liabilities, contingent or otherwise, arising from or relating to the
employment or termination of employment of any person with respect to the Business, including but
not limited to any such obligations or liabilities arising from or relating to the Employee Benefit
Plans or compensation of Employees, except as set forth in Schedule 6(b);
(H) Any and all Liabilities related to Accounts Payable (as defined in Exhibit A
hereto) of the Business arising prior to the Closing Date (as defined in Exhibit A) in the
amount of (a) €27,600,000 with respect to the German Seller relating to the Business conducted at
the Facilities, and (b) US$34,500,000 with respect to U.S. Seller relating to the Business
conducted at the Facilities (collectively, the “Excluded Accounts Payable”);
(I) Any and all Liabilities related to the Excluded Environmental Liabilities;
(J) Any and all Liabilities of Sellers (other than any Liability for Taxes, which shall be
governed exclusively by Section 6(e)) in any way associated with or related to the
ownership by Sellers prior to Closing of the Acquired Share Interests and the Ancillary Shares,
specifically including any Liabilities of German Seller under the Purchase and Assignment Agreement
dated as of August 26, 2006 between OXENO Olefinchemeie GmbH and German Seller granting an option
to German Seller to purchase the Degussa Interest and the Joint Venture Agreement dated as of
November 22, 2002 between Degussa and German Seller with respect to Eoxo; and
(K) the specified Liabilities listed on Schedule 2(c)(ii).
(d) Purchase Price for Purchased Assets. Buyer agrees to pay to or for the account of
Sellers (as directed by Sellers) for the Purchased Assets as follows:
(i) Prior to Closing, Buyer and Sellers shall conduct a physical inventory of the Facilities
for the purpose of determining the Inventory to be included in the calculation of Working Capital.
At least three Business Days prior to the Closing Date, Sellers shall deliver to Buyer a
certificate executed by Sellers (the “Initial Closing Date Statement”), setting forth a
good faith estimate of the Working Capital (the “Estimated Working Capital”) as of the
Closing Date. The Initial Closing Date Statement shall be prepared in accordance with Sellers’
historical accounting methods, policies, practices and procedures, with consistent classifications,
judgments, thresholds and estimation methodology reflected or assumed therein.
(ii) At the Closing, Buyer shall pay to or for the account of Sellers (as directed by Sellers)
(A) the sum of Four Hundred Eighty Million Euro (€480,000,000) (the “Base Amount”),
plus the Estimated Working Capital Adjustment, minus (B) the total of the amounts
outstanding as of the close of business on the day immediately preceding the Closing Date for
23
the items listed on Schedule 2(d)(ii) in cash, payable by wire transfer of immediately
available funds in accordance with the written instructions of Sellers provided by Sellers to Buyer
(the “Closing Payment”). The Closing Payment shall constitute the “Estimated Purchase
Price.”
(iii) As soon as reasonably practicable, but not later than 90 calendar days after the Closing
Date, Buyer shall (A) prepare a statement of the calculation of Working Capital as of the Closing
Date, the Final Working Capital Adjustment and the Final Specified Deductions (the “Closing
Date Statement”), and (B) deliver to Sellers the Closing Date Statement. The calculation of
the items set forth in the Closing Date Statement shall be prepared in accordance with Sellers’
historical accounting methods, policies, practices and procedures, with consistent classifications,
judgments, thresholds and estimation methodology, as were used in the preparation of the items set
forth in the Initial Closing Date Statement.
(iv) In connection with the preparation of the Closing Date Statement, Sellers shall permit
Buyer and their representatives reasonable access to books and records, personnel, and facilities
of Sellers to permit them to prepare the Closing Date Statement. Sellers shall have the right to
review the work papers of Buyer underlying or utilized in preparing the Closing Date Statement to
the extent reasonably necessary to verify the accuracy and fairness of the presentation of the
Closing Date Statement and calculation of the Final Working Capital Adjustment in conformity with
this Agreement.
(v) Within 20 calendar days after its receipt of the Closing Date Statement, Sellers either
shall inform Buyer in writing that the Closing Date Statement is acceptable or object thereto in
writing, setting forth a specific description of each of its objections. If Sellers so object and
the Parties do not resolve such objections on a mutually agreeable basis within 10 calendar days
after Buyer’s receipt of Sellers’ objections, the remaining disputed items shall be resolved within
an additional 20 calendar days by an internationally recognized independent accounting firm
selected by Buyer and reasonably acceptable to Sellers (the “Referral Firm”). Upon (A) the
agreement of the Parties, (B) the decision of the Referral Firm or (C) if Sellers fail to deliver
an objection to Buyer within the first 20-day period referred to above, then the Closing Date
Statement, as so adjusted (the “Final Closing Date Statement”), shall be final, conclusive
and binding against the Parties hereto. The statement of Working Capital set forth in the Final
Closing Statement shall be the “Final Working Capital” for all purposes hereunder. Sellers
shall make available to Buyer (upon request following the giving of any objection to the Closing
Date Statement) the workpapers of Sellers generated in connection with their review of the Closing
Date Statement.
(vi) In resolving any disputed item, the Referral Firm (A) shall be bound by the provisions of
this Section 2(d), (B) may not assign a value to any item greater than the greatest value claimed
for such item or less than the smallest value for such item claimed by either Buyer or Sellers and
(C) shall limit its decision to such items as are in dispute. The fees, costs and expenses of the
Referral Firm shall be borne by Buyer, on the one hand, and by Sellers, on the other hand, in
inverse proportion to their relative success in the resolution of such disputed items.
24
(vii) The “Final Purchase Price” shall mean (A) the sum of the Base Amount,
plus the Final Working Capital Adjustment, minus (B) the total of the amounts
outstanding as of the close of business on the day immediately preceding the Closing Date for the
items listed on Schedule 2(d)(ii) as adjusted to take into account the Final Specified
Deductions. Promptly after their receipt of the Final Closing Date Statement, Sellers and Buyer
shall compute the difference, if any, between the Estimated Purchase Price and the Final Purchase
Price. If the Estimated Purchase Price exceeds the Final Purchase Price, then Buyer shall be
entitled to receive, promptly and in any event within five Business Days, from Sellers an amount in
cash equal to such excess amount. If the Estimated Purchase Price is less than the Final Purchase
Price, Sellers shall be entitled to receive, promptly and in any event within five Business Days,
from Buyer an amount in cash equal to such deficiency. The amount of any payment to be made
pursuant to this Section 2(d)(vii) shall bear simple interest from and including the
Closing Date to but excluding the date of payment at a rate per annum equal to the rate of interest
published by the Wall Street Journal (Eastern edition) on the Closing Date as the
“prime rate” at large U.S. money center banks. Such interest shall be payable at the same
time as the payment to which it relates.
(viii) Within 90 days of the Closing Date, Buyer shall pay Sellers an amount equal to the
Excluded Accounts Payable as of the Closing Date.
(B) The sale of assets other than those referred to under subsection (A) above that are exempt
from VAT under Sec 4 of the German VAT Act remains tax free. German Seller will not exercise its
option right under Sec 9 of the German VAT Act with respect to such assets.
25
(e) Allocation of Purchase Price. The Final Purchase Price shall be preliminarily
allocated among the following: (i) Infraserv Oberhausen, (ii) German real estate (within any of the
Purchased Assets), (iii) Eoxo, (iv) European Pipeline, (v) Xxx-Xxxxxxxxxx GmbH, (vi)
Studiengesellschaft mbH, (vii) each of the German and U.S. portion of the Noncompetition Agreement
contemplated by Section 6(c), (viii) the Purchased Assets being sold by U.S. Seller and
(ix) all remaining Purchased Assets not otherwise included in clauses (i) through (viii) for
financial and tax accounting purposes as set forth in the allocation schedule attached hereto as
Schedule 2(e) (the “Initial Allocation Statement”). Within 90 days after the
Closing, Buyer and Sellers shall allocate the Final Purchase Price among the Purchased Assets in a
manner consistent with the Initial Allocation Statement (such final allocation, the “Final
Allocation Statement”) including further allocation, as the Parties may deem necessary, among the
Purchased Assets described in clauses (viii) and (ix). The Final Allocation Statement shall be
binding on Buyer and Sellers for all purposes, including federal, state, local and foreign income
Tax purposes, and the Parties agree not to take a contrary position on any Tax Return filed by any
Party with any Governmental Entity.
(f) Closing. The closing of the transactions contemplated by this Agreement (the
“Closing”) shall take place at a location or locations mutually satisfactory to the Parties
commencing at 9:00 a.m. local time (i) if the satisfaction or waiver of all conditions to the
obligations of the Parties to consummate the transactions contemplated hereby (other than
conditions with respect to actions the respective Parties will take at the Closing itself)
occurs at least five Business Days prior to the last Business Day of a calendar month, then on the
last Business Day of such calendar month, (ii) if the satisfaction or waiver of all conditions to
the obligations of the Parties to consummate the transactions contemplated hereby (other than
conditions with respect to actions the respective Parties will take at the Closing itself) occurs
less than five Business Days prior to the last Business Day of a calendar month, then on the last
Business Day of the calendar month immediately following the calendar month in which such
satisfaction or waiver occurs, or (iii) on such other date as Buyer and Sellers may mutually agree
in writing (the “Closing Date”); provided, however, that the Closing Date shall not be
earlier than January 21, 2007.
(g) Deliveries and Actions at Closing. At the Closing,
(i) Sellers will deliver to Buyer the various certificates, instruments and documents referred
to in Section 7(a);
(ii) Buyer will deliver to Sellers the various certificates, instruments and documents
referred to in Section 7(b);
26
(iii) Buyer will deliver to Sellers the Closing Payment;
(iv) With respect to the Seller Real Property located in the United States, U.S. Seller shall
deliver to the title company issuing Buyer’s title policy a standard seller’s affidavit to remove
standard printed exceptions to a title policy capable of deletion within the jurisdiction
(excluding the survey exception), and a gap indemnity/affidavit, and if existing surveys are
acceptable to title company, a seller’s survey affidavit;
(vi) U.S. Seller and U.S. Buyer shall execute and deliver a counterpart of a memorandum of
lease in recordable form as to the Facility located in Bay City, Texas, to be leased by U.S. Buyer
to U.S. Seller at Closing;
(vii) Buyer and German Seller will execute the transfer deed substantially in the form
attached hereto as Exhibit 2 (g)(vii) concerning the transfer of title to all shares in
Eoxo, Xxx-Xxxxxxxxxx GmbH, Studiengesellschaft mbH and Titan GmbH and title to the limited
partnership interest in Infraserv Oberhausen, and will execute a transfer deed in accordance with
Dutch law with respect to the European Pipeline Interest;
(viii) Sellers will deliver to Buyer an application letter to the commercial register for the
transfer of the limited partnership interest in Infraserv Oberhausen from German Seller to German
Buyer duly executed by all signatures of the partners of Infraserv Oberhausen that are Sellers or
Affiliates of Sellers, and Sellers shall use commercially reasonable efforts to obtain the
signatures of the partners that are not Sellers or Affiliates of Sellers, and such signatures will
be notarized (notariell beglaubigt) in line with German law requirements;
(ix) It is agreed between Buyer and Sellers that the executions of the documentation set forth
under item (vii) above constitute closing actions which shall take place at the Closing Date at the
latest, unless another date has been mutually agreed by Buyer and Sellers in writing.
(h) Special Covenants.
(i) Sellers shall, at Sellers’ sole expense, take all actions necessary and pay all
out-of-pocket costs of third parties required in order to accomplish prior to the Closing the tasks
set forth on Schedule 2(h) related to the carve-out from Sellers’ other operations of the
information technology systems used in the Business.
(ii) Sellers shall, at Sellers’ sole expense, repair the gasometer at Oberhausen to the extent
of the required repairs described in the Project Titan Business Review dated September 29, 2006
prepared by Ernst & Young (the “Vendor Due Diligence Report”) and use its commercially
reasonable best efforts to cause such repairs to be completed by the Closing.
27
(iii) Buyer shall cause to be paid when due all pension-related obligations for which Buyer
has made a deduction to the Final Purchase Price as set forth on Schedule 2(d)(ii).
(a) Organization. Parent is a corporation duly incorporated, validly existing and in
good standing under the laws of the State of Delaware. U.S. Seller is a limited partnership duly
organized, validly existing and in good standing under the laws of the State of Texas. German
Seller is a limited liability company duly incorporated and validly existing under the laws of
Germany. Each Company is a limited liability company duly incorporated and validly existing under
the laws of Germany. Each of Parent, Sellers and the Companies: (i) has all requisite corporate
power and authority to own, lease and operate its properties and to carry on its business as now
conducted, and (ii) except as would not reasonably be expected to have a Material Adverse Effect,
is duly qualified or authorized to do business and is in good standing under the laws of each
jurisdiction in which the conduct of its business or the ownership of its properties requires such
qualification or authorization.
(b) Authorization of Transaction. Each of Parent and Sellers has full power and
authority (including full corporate, limited liability company or partnership, as the case may be,
power and authority) to execute, deliver and perform its obligations under this Agreement. This
Agreement has been duly executed by Parent and each Seller, and, assuming the due authorization,
execution and delivery by each other Party hereto, this Agreement constitutes a valid and legally
binding obligation of Parent and each Seller, enforceable in accordance with its terms and
conditions, subject to the effect of any applicable bankruptcy, reorganization, insolvency,
moratorium, fraudulent conveyance or similar laws affecting creditors’ rights generally and to
general principles of equity, including concepts of materiality, reasonableness, good faith and
fair dealing, regardless of whether considered in a proceeding in equity or at law. Except as set
forth on Schedule 3(b), neither Parent nor any Seller is required by applicable law to give
any notice to, make any filing with, or obtain any authorization, consent or approval of
any Governmental Entity in order to consummate the transactions contemplated by this
Agreement, except where the failure to give notice, to file, or to obtain any authorization,
consent or approval has not had, and would not reasonably be likely to have a Material Adverse
Effect. The execution, delivery and performance of this Agreement and all other agreements
contemplated hereby have been duly authorized by Parent and each Seller. Sellers have made
available to Buyer copies of all current articles of associations and shareholders’ agreements
applicable to the Companies, all of which are presently valid and in full force and effect. Any
material facts and other material documents with respect to the Companies that are required by
applicable law to be filed with the competent commercial register have been filed and there are no
resolutions which are required to be registered in such commercial register but are not reflected
in the current excerpts therefrom.
(c) Non-contravention. Except as set forth on Schedule 3(c), neither the
execution and the delivery of this Agreement nor the consummation of the transactions contemplated
hereby or thereby, will:
28
(i) violate any constitution, statute, regulation, rule, injunction, judgment, order, decree,
ruling, charge or other restriction of any Governmental Entity to which Parent, either Seller or
any Company is subject or any provision of their respective articles or certificate of
incorporation, bylaws or other governing or organizational documents,
(ii) conflict with, result in a breach of, constitute a default under, result in the
acceleration of, create in any Person the right to accelerate (whether after the giving of notice
or lapse of time or both), terminate, modify or cancel, or require any notice or consent under any
Material Contract or Material Permit to which either Seller or a Company is a party or by which
either Seller or a Company is bound or to which any of either Seller’s or a Company’s assets is
subject, or
(iii) result in the imposition, loss, or creation of a Lien upon, or with respect to, the
Purchased Assets or a Company’s assets, other than Permitted Liens.
(d) Material Contracts.
(i) Except for Contracts listed on Schedule 3(d), there is no Contract which
constitutes a Purchased Asset or an Assumed Liability or to which a Company is a party which is:
(A) a Contract with any labor union or association;
(B) a note, loan, credit agreement or other Contract relating to the borrowing of money
(including derivative or hedging instruments) by either Seller or a Company in connection with the
Business or to the direct or indirect guarantee or assumption by either Seller or a Company of the
obligation of any other Person related thereto with respect to the Business;
(C) a lease or similar agreement under which either Seller or a Company is a lessee of, or
holds or operates, any real property owned by any third party;
(D) a Contract involving future payment for goods or services by either Seller or a Company of
more than €800,000 or US$1,000,000 annually (unless terminable by such Seller or such Company
without payment or penalty upon no more than 90 days’ notice or having a remaining term as of the
date hereof of less than six months, and excluding purchase orders issued by either Seller or a
Company or its Affiliates in the Ordinary Course of Business);
(E) a Contract involving the obligation of either Seller or a Company to deliver in the future
Products or services for payment of more than €800,000 or US$1,000,000 annually (unless terminable
without payment or penalty by such Seller or a Company upon no more than 90 days’ notice or having
a remaining term as of the date hereof of less than six months);
(F) a Contract evidencing any Lien on the Purchased Assets or a Company’s assets (other than
Permitted Liens);
29
(G) an executory Contract for the sale of any of the Purchased Assets or a Company’s assets
other than in the Ordinary Course of Business or for the grant to any Person of any preferential
rights to purchase any Purchased Assets outside of the Ordinary Course of Business or any Company;
(H) a Contract for a joint venture, strategic alliance, partnership or sharing of profits, in
each case involving equity ownership by a Seller or a Company, or a Contract relating to a
licensing arrangement or sharing of proprietary information outside of the Ordinary Course of
Business;
(I) a Contract containing covenants of either Seller or any Company not to compete in any line
of business or with any Person in any geographical area or not to solicit or hire any Person with
respect to employment or covenants of any other Person not to compete with either Seller or any
Company in any line of business or in any geographical area or not to solicit or hire any Person
with respect to employment;
(J) a Contract relating to the acquisition (by merger, purchase of stock or assets or
otherwise) by either Seller or any Company of the capital stock or any operating business or
material assets (excluding goods and services acquired in the Ordinary Course of Business) of any
other Person;
(K) any Contract included in the Purchased Assets which relates to German Seller’s ownership
of the European Pipeline Interest or any of the Ancillary Shares; or
(L) a Tax Sharing Agreement.
(ii) Each Material Contract (A) constitutes, or will at the Closing constitute, a valid and
binding obligation of the Seller or the Company party to such Material Contract, (B) is in full
force and effect and (C) is not terminable by the other party thereto by reason of this
transaction. Except as set forth in Schedule 3(d), no Seller or Company is in default
under any Material Contract, except for any such event of default as to which requisite waivers
have been obtained.
(e) Employee Matters.
(i) Schedule 3(e) contains a true and correct list of Employee Benefit Plans and
Employment Agreements (other than Employment Agreements providing for annual compensation of less
than €120,000 or US$150,000, “at-will” employment and severance benefits not exceeding the
greater of two weeks’ salary or wages for each year of service or one month’s base salary or wages)
and separately identifies the Employee Benefit Plans and Employment Agreements sponsored by or
solely with any of the Companies and their Subsidiaries or exclusively covering Company Employees
(“Company Plans”) and all other Employee Benefit Plans and Employment Agreements
(“Seller Plans”).”
(ii) There are no Employees with Employment Agreements other than German Employees and
European Employees.
30
(iii) There are no pending actions, claims or lawsuits arising from or relating to any Company
Plan except for any matter involving an action, claim or lawsuit for damages of less than €400,000
or US$500,000, nor are to Sellers’ Knowledge such actions, claims or lawsuits threatened in writing
to be brought or filed.
(iv) Except as set forth on Schedule 3(e), neither the execution and delivery of this
Agreement nor the consummation of the transaction contemplated hereby will, either alone or in
connection with any other event, (i) result in any payment becoming due to any current or former
Company Employee, (ii) increase any benefits owed to any current for former Company Employee under
any Employee Benefit Plan or Employment Agreement, (iii) result in the acceleration of the time of
payment or vesting of any benefits or rights of any Company Employee under any Employee Benefit
Plan or Employment Agreement, or (iv) require any contributions or payments to fund any obligations
with respect to any Company Employee under any Employee Benefit Plan or Employment Agreement.
(v) Each Company Plan in which German Employees participate has been maintained and
administered in compliance in all material respects with its terms and all applicable laws.
(vi) Except as set forth on Schedule 3(e), there are no labor, collective bargaining
or similar agreements with respect to Employees, and no Employees are represented by any works
council, union or similar labor organization. To Sellers’ Knowledge there are no organizing
activities (including any demand for recognition or certification proceedings pending or threatened
in writing to be brought or filed with the National Labor Relations Board or other labor relations
tribunal) involving Employees, or either Seller or any Company with respect to Employees. There
are no strikes, work stoppages, slowdowns, lockouts, unfair labor practice charges, grievances,
complaints, arbitrations or other material labor disputes pending or, to Sellers’ Knowledge,
threatened in writing against or involving Employees that would have a Material Adverse Effect.
(vii) Except as set forth on Schedule 3(e), there are no complaints, charges or claims
against either Seller or any Company pending, or, to Sellers’ Knowledge, threatened in writing to
be brought or filed, with any public or governmental authority, arbitrator or court
based on, arising out of, in connection with, or otherwise relating to the employment or
termination of employment by either Seller or any Company of any current or former Employee that
would have a Material Adverse Effect.
(viii) With respect to Employees, each of Sellers and the Companies are in compliance in all
material respects with all laws and orders relating to the employment of labor.
(ix) Without limiting the generality of the foregoing, with respect to all material pension
schemes in force and applicable to the German Employees (“German Pension Schemes”):
31
(A) The German Pension Schemes comply in all material respects with and have at all times been
administrated in all material respects in accordance with all applicable laws, regulations and
requirements;
(B) If applicable, adjustments in accordance with Section 16 German Act on Improvement of
Occupational Pension Schemes (Gesetz zur Verbesserung der betrieblichen Altersversorgung — BetrAVG)
have been made appropriately at all times prior to the Closing Date;
(C) Employer’s contributions to external funding vehicles for the German Pension Schemes due
prior to the Closing Date, in particular contributions to “Pensionskasse der Mitarbeiter der
Hoechst-Gruppe VVaG”, the “Hoechster Pensionskasse VVaG”, the “Xxxx/Degussa Pensionskasse” and the
“Degussa Unterstutzungskasse”, have been fully and timely paid or will be paid without undue delay;
(D) Except as disclosed in Schedule 3(e), there have been no closures of German
Pension Schemes carried out after December 31, 1986 and prior to the Closing Date; and
(E) To Seller’s Knowledge, there is nothing that will give rise to a pension claim, pension
entitlement or pension expectancy of Employees of the Companies under shop practice aspects
(Betriebliche Übung).
(f) Litigation. Except as set forth on Schedule 3(f), there is no pending or,
to Sellers’ Knowledge, threatened action, litigation, arbitration or proceeding, by any
Governmental Entity or private person against either Seller or a Company or any of its Affiliates
which has resulted or if threatened may result, in (i) the institution of legal proceedings to
prohibit, enjoin or restrain the performance in any material respect by either Seller of this
Agreement or any of the Ancillary Agreements to which such Seller or its Affiliate is to be a
party, or (ii) a Claim for damages related to the Purchased Assets, a Company’s assets or the
Facilities or any of the Ancillary Agreements, in either case, except for any matter involving a
claim for damages of less than €400,000 or US$500,000.
(g) Compliance With Laws. Except as disclosed on Schedule 3(g) and except
with respect to Environmental Laws, which are covered in Section 3(i), (i) each of the Sellers and
Companies are and have been during the five-year period prior to the date hereof in compliance in
all material respects with all laws applicable to their respective operations with
respect to the Business or Purchased Assets, and in particular all applicable laws regarding
the increase or decrease of the share capital (Stammkapital) and liability capital
(Kommanditeinlage)of the Companies have been duly observed; (ii) none of the Sellers or Companies
has received any written notice of or been charged with the violation of any laws with respect to
the Business which has not been resolved; and (iii) none of the Sellers or Companies has received
written notice that it is under investigation with respect to the violation of any laws with
respect to the Business.
32
(h) Permits. Schedule 3(h) contains a list of all Permits which are
required for the operation of the Business at the Facilities as presently conducted and as
presently intended to be conducted and which are material to the Business conducted at the
Facilities (the “Material Permits”). Material Permits does not include Permits required
for the operation of the Business at the Facilities as presently conducted and as presently
intended to be conducted under Environmental Laws and which are material to the Business conducted
at the Facilities (the “Material Environmental Permits”). Except as disclosed on
Schedule 3(h), Sellers and the Companies possess all Material Permits. None of Sellers or
the Companies is in default or violation, and no event has occurred which, with notice or the lapse
of time or both, would constitute a default or violation, in any material respect of any term,
condition or provision of any Material Permit. There are no legal proceedings pending or, to
Sellers’ Knowledge, threatened, relating to the suspension, revocation or modification of any of
the Material Permits. Except as disclosed on Schedule 3(h), none of the Material Permits
will be impaired or in any way affected by the consummation of the transactions contemplated by
this Agreement.
(i) Environmental Matters. Schedule 3(i) contains a list of all Material
Environmental Permits. Except as disclosed on Schedule 3(i) or except for conditions that
would not reasonably be expected to result in material Liabilities under Environmental Laws with
respect to the Business:
(A) each Seller and Company has obtained, currently maintains and is in compliance in all
material respects with all Material Environmental Permits, which are required for the operation of
the Business as presently conducted and, to the Knowledge of Sellers, there are no legal
proceedings pending or threatened relating to the suspension, revocation or modification of the
Material Environmental Permits and, to the Knowledge of Sellers, none of the Material Environmental
Permits will be modified (or are reasonably likely to be modified) in a manner that impose new
material obligations or costs on the Business in order to consummate the transactions contemplated
by this Agreement;
(B) Sellers’ and the Companies’ use of and operations at the Facilities are and have been in
compliance in all material respects with all applicable Environmental Laws;
(C) None of Sellers or any Company has received any written notice or claim from any
Governmental Entity or other Person that such Seller’s or such Company’s use and operation of the
Business violates such Material Permits or any applicable Environmental Laws or alleges Liability
of such Seller or such Company with respect to the Business under any Environmental Laws, other
than notices that have been resolved, and to the Knowledge of Sellers, no such notice or claim has
been threatened; and
(D) None of Sellers or any Company with respect to the Business is subject to any proceeding
or, to Sellers’ Knowledge, any investigation, nor to Sellers’ Knowledge, is any such proceeding or
investigation threatened, alleging the violation of or Liability under Environmental Laws.
33
(j) Condemnation. Neither Seller nor a Company has received any written notice of any
pending or threatened proceeding or governmental action to condemn or take by power of eminent domain or otherwise by any Governmental Entity of all or any part of the
Purchased Assets or a Company’s assets.
(k) Title to Purchased Assets; Sufficiency.
(i) Sellers or their Affiliates hold good and marketable title to all the Purchased Assets,
free and clear of all Liens, but subject to the Permitted Liens. Each Company holds good and
marketable title to all of its assets, including its Company Personal Property, free and clear of
all Liens, but subject to the Permitted Liens. This subclause (i) does not relate to the Real
Property, the Estech Assets or the Transferred Intellectual Property, which are exclusively the
subject of Sections 3(k)(ii)(A) and (B), Section 3(k)(ii)(C) and Section 3(l) hereof, respectively.
(ii) (A) Sellers or their Affiliates have good, indefeasible and insurable title to the Seller
Real Property, free and clear of all Liens other than Permitted Liens.
(B) Each Company has good, indefeasible and insurable title to its Company Real Property, free
and clear of all Liens other than Permitted Liens.
(C) Sellers or their Affiliates hold good and marketable title to all the Estech Assets, free
and clear of all Liens, but subject to the Permitted Liens.
(iii) Except as set forth on Schedule 3(k), the Purchased Assets, together with the
products and services to be provided to Buyer pursuant to the Ancillary Agreements, constitute all
of the assets primarily used in the Business, and such Purchased Assets are sufficient for Buyer to
conduct the Business immediately after the Closing in all material respects as the Business has
been conducted immediately prior to the Closing consistent with past practices.
(iv) The hereditary building right created with notarial deed N° 812/2003 of the notary Xxxxx
Xxxxx in Marl can be entered in all relevant land registers on first rank and no obstacles —
whatever they might be — exist which might prohibit or prevent the registration of the hereditary
building right in the relevant land registers.
34
(l) Intellectual Property and Technology.
(i) Schedule 3(l)(i) sets forth an accurate list, as of the date of this Agreement, of
all registered Transferred Intellectual Property as well as applications for registration of
Transferred Intellectual Property. All Transferred Intellectual Property is valid, subsisting and,
to Sellers’ Knowledge, enforceable. Except as set forth on Schedule 3(l)(i), Sellers and
their Affiliates have the sole and exclusive right, title and interest in and to, or have valid and
continuing rights to use and sell to Buyer, all Transferred Intellectual Property and Transferred
Technology, free and clear of all Liens or obligations to others.
(ii) Following the Closing and except as set forth on Schedule 3(l)(ii), Buyer shall
solely and exclusively own all right, title and interest in and to, or have valid and continuing
rights to use, sell and license, all Transferred Technology and Transferred Intellectual Property, with the exception only of moral rights in copyrights that are not capable, as a
matter of applicable law, of being transferred.
(iii) Except as set forth in Schedule 3(l)(iii), there is no action, suit, proceeding,
investigation, notice or complaint pending or, to the Knowledge of Sellers, threatened, by any
Person before any court or tribunal relating to any Transferred Technology or Transferred
Intellectual Property, nor has any claim or demand been made to Sellers or any of their Affiliates
that (a) challenges the validity, enforceability, use or ownership of any Transferred Technology or
Transferred Intellectual Property or (b) alleges that any aspect of the Business or the Products
infringes or otherwise violates any Person’s right in or to its own Technology or Intellectual
Property, nor is there any basis for any such claim or demand. To Sellers’ Knowledge, there is no
infringement of the Transferred Intellectual Property by any Person as of the Closing Date.
(iv) Schedule 3(l)(iv) sets forth a complete and accurate list of: (a) all agreements
pursuant to which Sellers or their Affiliates have licensed a third party for any purpose any
Intellectual Property or Technology included in the Transferred Intellectual Property and
Transferred Technology; and (b) all agreements pursuant to which Sellers or their Affiliates
receive a license from any third party under any Intellectual Property or Technology (excluding
systems Software used by Sellers on a corporate-wide basis and off-the-shelf Software) used in
connection with the Business. Except as set forth on Schedule 3(l)(iv) and to the
Knowledge of Sellers, the consummation of the transactions contemplated by this Agreement will not
give rise to a right of any counterparty to terminate or limit the rights of Sellers, their
Affiliates or Buyer with respect to any Intellectual Property included in the Transferred
Intellectual Property and/or Transferred Technology.
(v) Sellers and their Affiliates have taken reasonable measures, consistent with practices in
the chemicals industry, to protect the confidentiality of all trade secrets included in the
Transferred Intellectual Property and Transferred Technology that are material to the Business.
Except for disclosures made to customers, clients, partners or prospects pursuant to non-disclosure
agreements as contained in Sellers’ data room materials, neither Sellers nor any Affiliate has
disclosed or provided to any Person (other than an employee under enforceable
35
obligations of confidence) any confidential or secret material concerning the Transferred Intellectual Property or
Transferred Technology.
(vi) All service inventions (“Diensterfindungen”) achieved by German employees that
are part of the Transferred Intellectual Property and/or Transferred Technology have been claimed
in compliance with Section 6 of the German Employee Invention Act
(“Arbeitnehmererfindungsgesetz”). All claims of such inventors for which Sellers are
liable and that are due before the Closing Date, have been or will be fully satisfied by Sellers
and have not exceeded the amount of €128,000 per year in the last 5 calendar years prior to the
Closing Date. Where service inventions are kept as unpatented know-how, Sellers have honored the
patentability of such service inventions according to Section 17 of the Employee Inventions Act. To
the extent the Transferred Intellectual Property includes service inventions achieved in other
countries that have laws or regulations comparable to the German Employee Invention Act, Sellers
have complied with the requirements imposed by these laws, and all claims of such inventors for which Sellers are liable and that are due before the Closing Date, have been or
will be fully satisfied by Sellers.
(vii) If Degussa exercises its right to terminate the Eoxo License, then Degussa or OXENO
Olefinchemie GmbH has the obligation to negotiate either a permanent license at no charge or a
transfer of the intellectual property referred to in the Eoxo License.
(m) Taxes.
(i) (A) all material Tax Returns required to be filed by, on behalf of or with respect to the
Companies and the Purchased Assets have been duly and timely filed in all jurisdictions in which
such Tax Returns are required to be filed (after giving effective to any duly obtained extensions
of time in which to make such filings), and all such Tax Returns are true, complete and correct in
all material respects; (B) as to Eoxo, all Taxes shown due on such applicable Tax Returns have been
paid, and as to the Companies (other than Eoxo) and the Purchased Assets, all amounts of material
Taxes due and payable or claimed or asserted by any Taxing Authority to be due and payable with
respect to such Companies and the Purchased Assets have been timely paid; and (C) each Company
(and, with respect to the Purchased Assets, each Seller) has, with respect to any period for which
Tax Returns have not yet been filed or for which Taxes are not yet due or owing (including
contingent and deferred Tax liabilities), made accruals for the full amount of such Taxes on such
Company’s or the relevant Seller’s financial statements in accordance with such Company’s or
Seller’s historical accounting methods.
(ii) Each Company (other than Eoxo) has complied in all material respects with all applicable
laws relating to the payment and withholding of Taxes, and has duly and timely withheld and paid
over to the appropriate Taxing Authority all amounts required to be so withheld and paid under all
applicable laws. Eoxo has complied in all material respects with all applicable laws relating to
the payment and withholding of Taxes, and has duly and timely withheld and paid over to the
appropriate Taxing Authority all material amounts shown due on the applicable Tax Returns.
36
(iii) None of the Companies has any liability for the Taxes of any other Person as a
transferee or successor, or by contract or otherwise.
(iv) Since the completion of the Vendor Tax Due Diligence, none of the Companies (or, with
respect to the Purchased Assets, Sellers) has (A) made or changed any material Tax election (other
than the U.S. Election as provided in 6(e)(xiv)) or (B) amended any Tax Return, settled any
material Tax action, suit, investigation, audit or claim.
(v) None of the Companies (or, with respect to property Taxes levied with respect to the
Purchased Assets, the Sellers) (A) is a party to any agreement extending the time within which to
file any Tax Return, (B) has granted any extension of the statute of limitations for the assessment
or collection of Taxes or (C) has granted to any Person any power of attorney that is currently in
force with respect to any Tax matter.
(vi) Since the completion of the Vendor Tax Due Diligence, there have been no new actions,
suits, investigations or audits by any Taxing Authority in progress with respect to material Taxes
of or relating to any Company or the Purchased Assets. Since the completion of the Vendor Tax Due Diligence, none of the Companies (or, with respect to the Purchased
Assets, Sellers) has received any written notice to the effect that, nor does any Company (or, with
respect to property Taxes levied with respect to the Purchased Assets, any Seller) have knowledge
that, any Taxing Authority intends to conduct such an audit or investigation. Since the completion
of the Vendor Tax Due Diligence, there have been no new assessments, claims or deficiencies for any
material Taxes of any Company (or with respect to any of the Purchased Assets) that have been
proposed, asserted or assessed.
(vii) None of the Companies has (A) agreed to nor is currently required to make any
adjustments pursuant to a change of accounting method under any applicable provision of federal,
state, local or foreign Tax law, (B) knowledge that any Taxing Authority has proposed any such
adjustment, or (C) an application pending with any Taxing Authority requesting permission for any
changes in accounting methods.
(viii) Since the completion of the Vendor Tax Due Diligence, none of the Companies (or, with
respect to property Taxes levied with respect to the Purchased Assets, Sellers) has executed or
entered into any written agreement with, or obtained or applied for any written consents or written
clearances or any other Tax rulings from, nor has there been any written agreement executed or
entered into on behalf of any of them with any Taxing Authority, relating to material Taxes.
(ix) To the Knowledge of the Sellers, none of the Companies is, or has ever been, subject to
income Tax in a jurisdiction outside Germany.
(x) The Vendor Tax Due Diligence identifies all items which would had to have been disclosed
on Schedule 3(m) had the representations herein not been limited in certain respects to
events occurring after the Vendor Tax Due Diligence was completed.
37
(n) Capitalization.
(i) German Seller is the sole owner of the Fifty Percent Eoxo Interest, free and clear of any
Liens. The Fifty Percent Eoxo Interest and the Degussa Interest constitute all of the outstanding
nominal share capital of Eoxo. At the Closing, German Seller will own the Entire Eoxo Interest,
free and clear of any Liens. There is not outstanding (A) any security directly or indirectly
convertible into or exercisable or exchangeable for any new share of Eoxo, or (B) any option,
warrant or other right to acquire any new share of Eoxo or any security directly or indirectly
convertible into or exercisable or exchangeable for any new share of Eoxo.
(ii) Sellers and their Affiliates are the sole owners of the Infraserv Oberhausen Interest,
free and clear of any Liens. There is not outstanding (A) any security directly or indirectly
convertible into or exercisable or exchangeable for any new partnership interest of Infraserv
Oberhausen, or (B) any option, warrant or other right to acquire any new partnership interest of
Infraserv Oberhausen or any security directly or indirectly convertible into or exercisable or
exchangeable for any new partnership interest of Infraserv Oberhausen.
(iii) German Seller is the sole owner of the Titan GmbH Share, free and clear of any Liens.
The Titan GmbH Share constitutes all of the outstanding nominal share capital of Titan GmbH, and
there is not outstanding (A) any security directly or indirectly convertible into or exercisable or exchangeable for any new share of Titan GmbH, or (B) any option, warrant or
other right to acquire any new share of Titan GmbH or any security directly or indirectly
convertible into or exercisable or exchangeable for any new share of Titan GmbH.
(iv) German Seller is the sole owner of the European Pipeline Interest, free and clear of any
Liens.
(v) German Seller is the sole owner of the Ancillary Shares, free and clear of any Liens.
There are no outstanding contributions due and owing by German Seller with respect to the Ancillary
Shares.
(vi) The share capital (Stammkapital) and liability capital (Kommanditeinlage) of each of the
Companies is fully paid-in, non-assessable (nicht nachschusspflichtig) and no repayments or
refunds, neither openly nor concealed, have been made. The Companies have not entered into any
silent partnership agreements, domination and profit and loss pooling agreements or any other
agreements within the meaning of Section 291 et seq. of the German Stock Corporation Act or similar
agreements such as plant management agreements.
(vii) Other than the Acquired Share Interests, the Companies do not hold — neither directly,
indirectly nor in trust — any shares, interests or equity (including, without limitation, silent
partnerships and sub-participations) in, and have not entered into any agreement to hold any
shares, interests or equity in or to establish, any other entity.
(viii) No bankruptcy, insolvency, judicial composition or comparable proceedings have been
initiated or applied for under any applicable law against any of the Companies.
38
(o) Financial Information.
(i) True and complete copies of the audited financial statements of Eoxo, together with all
related notes and schedules thereto, accompanied by the report thereon of Eoxo’s independent
auditors for the years ended December 31, 2004 and 2005 (the “Eoxo Financial Statements”)
present fairly, in all material respects, the financial position, results of operations and cash
flows of Eoxo for the periods indicated therein and have been prepared in accordance with
accounting principles generally accepted in Germany.
(ii) The unaudited pro forma balance sheet information, current trading information and cash
flows information of the Business for the year ended December 31, 2004 and 2005 and for the eight
months ended August 31, 2006 contained in the Vendor Due Diligence Report present fairly, in all
material respects, the financial position, results of operations and cash flows of the Business for
the periods indicated therein and have been prepared in accordance with historical accounting
methods (except with respect to Eoxo, such methods being in accordance with accounting principles
generally accepted in the United States), as modified by the assumptions and adjustments stated
therein. The assumptions used in preparing such information in the Vendor Due Diligence Report
provide a reasonable basis for presenting the significant effects directly attributable to the
transactions or events described therein. The related pro forma adjustments give appropriate
effect to those assumptions (and, to the Knowledge of Sellers, no circumstances exist which would cause such assumptions or
adjustments to no longer be valid in all material respects).
(iii) None of the Sellers or any Company has any material Liabilities of any kind that are
included in Assumed Liabilities and that are not set forth (A) in the balance sheet of Eoxo as of
December 31, 2005 included in the Eoxo Financial Statements, or (B) in the pro-forma balance sheet
of the Business as of August 31, 2006, except for (1) such Liabilities that would not be required
to be included in such balance sheet in accordance with the accounting principles used to prepare
such balance sheet, and (2) Liabilities incurred by Eoxo since December 31, 2005 in the Ordinary
Course of Business and Liabilities incurred by the Business since August 31, 2006 in the Ordinary
Course of Business.
(iv) As of the Closing Date, none of the Companies shall have any indebtedness for borrowed
money, except for the obligation to reimburse employees, directors and officers for travel and
entertainment expenses in the Ordinary Course of Business.
(v) Since August 31, 2006, no action has been taken by the Companies or, with respect to the
Business, Sellers which, if taken after the date hereof, would be a violation of Section 5(c)(ii).
(vi) The Vendor Due Diligence Report reflects in all material respects the economic terms set
forth in the Ancillary Agreements listed in clauses (a) through (f), inclusive, of the definition
of “Ancillary Agreements.”
39
(vii) Sellers have outstanding guarantees relating to the Business as set forth in
Schedule 6(m), and the amounts of such guarantees do not exceed the respective amounts set
forth in Schedule 6(m).
(p) Inventories. The inventories of the Business meet applicable specifications, are
saleable in the Ordinary Course of Business and are consistent in quantity with Sellers’ past
practices. Inventory values are recorded in accordance with Sellers’ historical accounting
methods, which includes adequate reserves for obsolete or otherwise unusable inventory.
(q) Accounts and Notes Receivable and Payable.
(i) All accounts and notes receivable of Sellers and the Companies that are related to the
Business have arisen from bona fide transactions in the Ordinary Course of Business consistent with
past practice and are payable on ordinary trade terms. None of the accounts or the notes
receivable of Sellers and the Companies that are related to the Business are subject to any
material setoffs or counterclaims in excess of the bad debt reserve set forth in the pro forma
financial statements in the Vendor Due Diligence Report.
(ii) All accounts payable of Sellers and the Companies that are related to the Business are
the result of bona fide transactions in the Ordinary Course of Business.
(r) Intercompany Transactions. At the Closing, there will be no indebtedness for
borrowed money owed by any of the Companies to Sellers or any employee, director, officer or
Affiliate of Sellers (other than the Companies), except for the obligation to reimburse such employees, directors and officers for travel and entertainment expenses in the Ordinary Course
of Business, and there will be no indebtedness for borrowed money owed by any employee, director,
officer or Affiliate of Sellers (other than the Companies) to the Companies. There are no
outstanding loans by any of the Companies to any of the Employees.
(s) Customers and Suppliers.
(i) Schedule 3(s) sets forth a list of the ten largest customers and the ten largest
suppliers of the Business, as measured by the dollar amount of purchases therefrom or thereby,
during each of the fiscal years ended December 31, 2004 and 2005.
(ii) In the 12 months prior to the date hereof, no customer or supplier listed on Schedule
3(s) has terminated its relationship with the Business or materially reduced or materially
changed the pricing or other terms of its business with the Business and no customer or supplier
listed on Schedule 3(s) has provided written notice to a Seller that it intends to
terminate or materially reduce or change the pricing or other terms of its business with the
Business.
(t) Product Warranty; Product Liability. Except as set forth on Schedule
3(t), no material amount of Product manufactured, sold and delivered within the past three
years in the Business has failed to be in conformity in all material respects with all product
specifications and warranties provided to customers thereof.
40
(u) Site Service Cost Coverage. The aggregate price to be paid by Sellers (and their
Affiliates if applicable) for all “Site Services” to be delivered by Buyer to Sellers (and their
Affiliates and licensees, if and as applicable), pursuant to the schedules attached to the US Site
Services Agreement for Bay City, Texas, and the German Site Services Agreement for Oberhausen,
Germany, has been calculated to be sufficient to cover all costs reflected in the Vendor Due
Diligence Report payable by Sellers (and their Affiliates, if applicable) in order to obtain such
“Site Services” for the benefit of Sellers (and their Affiliates and licensees, if and as
applicable), in the one-year period ending December 31, 2006.
(v) Site Service Profit. The aggregate profit of Sellers (and their Affiliates if
applicable) for all “Site Services” to be delivered by Sellers pursuant to the pricing terms
therefor set forth in the schedules attached to the US Site Services Agreement for Bay City, Texas,
and the US Site Services Agreement for Xxxxxx, Texas, shall not exceed €4,500,000 under such
pricing terms during the first year of the term of such Site Services Agreements.
(w) Disclaimers Regarding Assets. Except for any representations and warranties set
forth herein, the Purchased Assets are sold “as is, where is”, and each Seller expressly
disclaims any other representations or warranties of any kind or nature, express or implied, as to
liabilities, operations of the facilities, the title, condition, value or quality of the Purchased
Assets or the prospects (financial and otherwise), risks and other incidents of the Purchased
Assets and Sellers specifically disclaim any representation or warranty of merchantability, usage,
suitability or fitness for any particular purpose with respect to the Purchased Assets, or any part
thereof, or whether latent or patent, or as to the condition of the Purchased Assets, or any part
thereof, or whether Sellers possess sufficient resources to operate the Purchased Assets. Except as otherwise expressly provided
herein, Sellers further specifically disclaim any representation or warranty regarding the absence
of Hazardous Substances or liability or potential liability arising under Environmental Laws.
Without limiting the generality of the foregoing, except as otherwise expressly provided herein,
Sellers expressly disclaim any representation or warranty of any kind regarding the Business, the
condition of the Purchased Assets or the suitability of the Facilities for operation as
manufacturing plants and no exhibit to this Agreement, nor any other material or information
provided by or communications made by any Seller or its Affiliates, or by any advisor thereof,
whether by use of a “data room,” or in any vendor due diligence report or information
memorandum, or otherwise, or by any broker or investment banker, will cause or create any warranty,
express or implied, as to the title, condition, value or quality of the Business or the Purchased
Assets.
(a) Organization of Buyer. Parent Buyer is a limited liability company, duly
organized, validly existing and in good standing under the laws of the Cayman Islands. U.S. Buyer
is a corporation, duly organized, validly existing and in good standing under the laws of the State
of Delaware. German Holdco is a limited liability company, duly organized, validly
41
existing and in
good standing under the laws of Germany. German Buyer is a limited liability company, duly
organized, validly existing and in good standing under the laws of Germany.
(b) Authorization of Transaction. Buyer has full power and authority (including full
corporate, limited liability company or partnership, as the case may be, power and authority) to
execute, deliver and perform its obligations under this Agreement. This Agreement has been duly
executed by Buyer, and, assuming the due authorization, execution and delivery by each other Party
thereto, this Agreement constitutes a valid and legally binding obligation of Buyer, enforceable in
accordance with its terms and conditions, subject to the effect of any applicable bankruptcy,
reorganization, insolvency, moratorium, fraudulent conveyance or similar laws affecting creditors’
rights generally and to general principles of equity, including concepts of materiality,
reasonableness, good faith and fair dealing regardless of whether considered in a proceeding in
equity or at law. Buyer is not required by applicable law to give any notice to, make any filing
with, or obtain any authorization, consent or approval of any Governmental Entity in order to
consummate the transactions contemplated by this Agreement, except where the failure to give
notice, to file, or to obtain any authorization, consent or approval has not had and would not
reasonably be likely to have a Material Adverse Effect. The execution, delivery and performance of
this Agreement and all other agreements contemplated hereby have been duly authorized by Buyer.
(c) Non-contravention. Neither the execution and the delivery of this Agreement, nor
the consummation of the transactions contemplated hereby, will (i) violate any constitution,
statute, regulation, rule, injunction, judgment, order, decree, ruling, charge or other restriction
of any Governmental Entity to which Buyer is subject or any provision of its certificate of
incorporation, bylaws or other governing documents, or (ii) conflict with, result in a breach of,
constitute a default under, result in the acceleration of, create in any Person the right to
accelerate (whether after the giving of notice or lapse of time or both), terminate, modify, or cancel, or require any notice under any Contract to which Buyer is a party or by which it is
bound or to which any of its assets is subject, except those breaches, defaults, violations or
conflicts that individually have not had, and would not reasonably be likely to have a Material
Adverse Effect.
(d) Litigation. There is no pending or, to the knowledge of Buyer, threatened action,
by any Governmental Entity or private person which has resulted in (i) the institution of legal
proceedings to prohibit or restrain the performance by Buyer of this Agreement or any of the
Ancillary Agreements to which Buyer is a party, or (ii) a Claim for damages as a result of this
Agreement or any of the Ancillary Agreements, in either case, except for any matter that will not
individually have a Material Adverse Effect.
(e) Availability of Funds; Financing.
(i) Buyer will have, as of the Closing, sufficient funds to consummate the transactions
contemplated by this Agreement.
(ii) Attached hereto as Exhibit K is a true and complete copy of the term sheets,
dated as of the date hereof (the “Debt Term Sheets”), between Buyer and Commerzbank
42
Aktiengesellschaft and UBS Limited (the “Lenders”) confirming the Lenders’ respective
commitments to provide Buyer with debt financing specified therein (the “Debt Financing”).
(iii) Attached hereto as Exhibit L is a true and complete copy of a binding equity
commitment letter, dated as of the date hereof and issued by Advent to Parent Buyer (the
“Equity Commitment Letter” and together with the Debt Term Sheets, the “Commitment
Letters”).
(iv) Each Commitment Letter has been duly authorized and executed by Buyer, Advent, as
applicable, and to the knowledge of Buyer, the other parties thereto. Each Commitment Letter is in
full force and effect. The Equity Commitment Letter constitutes, and at the Closing will
constitute, the legal, valid and binding obligation of Advent. Each Seller is a third-party
beneficiary of the Equity Commitment Letter with the right to enforce such Equity Commitment Letter
in accordance with its terms.
(i) From the date hereof through the Closing Date, except as may be expressly contemplated by
this Agreement and except as may be consented to in writing by Buyer, Sellers will, and shall cause
the Companies to, with respect to the Business:
(A) conduct the Business only in the Ordinary Course of Business; and
(B) use its commercially reasonable efforts to preserve the present business
operations, organization (including officers and Employees) and goodwill of
43
Sellers and the Companies and preserve the present relationships with Persons having business dealings with Sellers and the Companies (including customers and suppliers).
(ii) Without limiting the generality of the foregoing, except as otherwise expressly provided
by this Agreement or with the prior written consent of Buyer, from the date hereof through the
Closing Date, Sellers shall not permit the Companies to take any of the following actions, and
Sellers shall not take any of the following actions, in each case only to the extent such actions
would affect its obligations hereunder or affect the Purchased Assets or Assumed Liabilities:
(A) make, change or revoke any Tax election (except the U.S. Election provided in
Section 6(e)(xiv)), settle or compromise any Tax claim or liability or enter into a
settlement or compromise, or change (or make a request to any taxing authority to change)
any material aspect of its method of accounting for Tax purposes;
(B) prepare or file any Tax Return (or any amendment thereof) unless such Tax Return
shall have been prepared in a manner consistent with past practice.
(C) except as provided in Section 5(h), adopt or amend any Company Plan, increase
compensation or benefits to any Employee, enter into or amend any Employment Agreement,
except as required by applicable laws or existing agreement; or adopt or amend any Seller
Plans except in the Ordinary Course of Business;
(D) subject any of the Purchased Assets or any asset of the Companies to any Lien,
except for Permitted Liens;
(E) acquire any material properties or assets or sell, assign, license, transfer,
convey, lease or otherwise dispose of any of the Purchased Assets or any asset of the
Companies, other than in the Ordinary Course of Business;
(F) enter into or agree to enter into any merger or consolidation with, any corporation
or other entity, and not engage in any new business or invest in, make a loan, advance or
capital contribution to, or otherwise acquire the securities of any other Person, except (1)
in accordance with the terms of existing Contracts, or (2) to the extent such actions do not
prevent the consummation of the sale of the Purchased Assets and assumption of the Assumed
Liabilities on the terms contemplated by this Agreement;
(G) cancel or compromise any material debt or claim or waive or release any material
right of any Seller or any of the Companies except in the Ordinary Course of Business;
(H) enter into any commitment for capital expenditures in excess of the current capital
expenditure budget of the Business;
44
(I) enter into, modify or terminate any material labor agreement or any collective
bargaining agreement or make any commitment or incur any material liability to any labor
organization with respect to any Employee;
(J) introduce any material change with respect to the operation of the Business,
including any material change in the types, nature, composition or quality of products or
services, or, other than in the Ordinary Course of Business, make any material change in
product specifications or prices or terms of distributions of such products;
(K) enter into any Contract, understanding or commitment that restrains, restricts,
limits or impedes the ability of the Business, or the ability of Buyer, to compete with or
conduct any business or line of business in any geographic area or solicit the employment of
any persons;
(L) terminate, amend, restate, supplement or waive any rights under any (A) Material
Contract other than in the Ordinary Course of Business or (B) Material Permit or Material
Environmental Permit;
(M) settle or compromise any pending or threatened Legal Proceeding in excess of
€400,000 or US$500,000;
(N) accelerate collections of receivables (whether or not past due) or fail to pay or
delay payment of payables or other Liabilities other than in the Ordinary Course of
Business;
(O) amend the organizational or governing document of any Company; or
(P) agree to do anything (A) prohibited by this Section 5(c)(ii) or (B) that
would be reasonably expected to have a Material Adverse Effect.
(iii) Notwithstanding anything to the contrary in this Agreement, Sellers’ termination of
Seller Guarantees prior to Closing in accordance with Section 6(m) shall not constitute a breach of this Agreement and Sellers shall have no Liability to Buyer by reason
thereof, including without limitation any Liability relating to termination of any Contract in
accordance with its terms, the performance of which is subject to such Seller Guarantees.
45
(i) notify the other Party as soon as reasonably practicable (and provide copies or, in
the case of non-written material communications, reasonable summaries, except where the notifying
Party deems the information contained therein to be confidential, in which case it will be provided
to the notified Party’s legal advisers on a counsel-only basis) of any communications with any such
Relevant Competition Authority relating to any such consent, approval or action;
(ii) provide the other Party (or where the notifying Party deems the information contained
therein to be confidential, the notified Party’s legal advisers on a counsel- only basis) with a
final draft of all submissions, notifications, filings and other communications to any Governmental
Entity at such time as will allow the notified Party (or its advisers) a reasonable opportunity to
provide comments and for the notifying Party to take account of any reasonable comments of the
notified Party (or its advisers) on such drafts prior to their submission;
(iii) give the other Party reasonable notice of and the opportunity for the other Party or any
of its advisers to attend all material meetings and telephone calls where appropriate (having
regard to commercial sensitivities) with any Relevant Competition Authority; and
(iv) periodically review with the other Party the progress of any notifications or filings
with a view to obtaining clearance from any Relevant Competition Authority at the earliest
reasonable opportunity.
46
(iv) to the extent required by any
lender providing financing to Buyer, an estoppel certificate and
landlord consent for U.S. Seller’s lease of the Facility in Xxxxxx, Texas to Buyer in a form
reasonably acceptable to Buyer and U.S. Seller.
(i) Sellers shall not, and shall not permit any of the Affiliates, directors, officers,
Employees, representatives or agents of Sellers or the Companies (collectively, the
“Representatives”) to, directly or indirectly, (A) discuss, encourage, negotiate,
undertake, initiate, authorize, recommend, propose or enter into, either as the proposed surviving,
merged, acquiring or acquired corporation, any transaction involving a merger, consolidation,
business combination, purchase or disposition of any material amount of the Purchased Assets or any
capital stock of any of the Companies other than the transactions contemplated by this Agreement
(an “Acquisition Transaction”), (B) facilitate, encourage, solicit or initiate discussions,
negotiations or submissions of proposals or offers in respect of an Acquisition Transaction, (iii)
furnish or cause to be furnished, to any Person, any information concerning the Purchased Assets or
the Companies in connection with an Acquisition Transaction, or (C) otherwise cooperate in any way
with, or assist or participate in, facilitate or encourage, any effort or attempt by any other
Person to do or seek any of the foregoing.
(ii) Sellers shall (and shall cause its Representatives to) immediately cease and cause to be
terminated any existing discussions or negotiations with any Persons (other than Buyer) conducted
heretofore with respect to any Acquisition Transaction. Sellers agree not to release any third
party from the confidentiality and standstill provisions of any agreement to which Sellers or any
of the Companies is a party.
47
xxxx 00, xxxxxxx 0, 00 and 33, from and after January 1, 2007, in the event that a termination
agreement regarding the hereditary building right with respect to the aforementioned parcels
created with notarial deed N° 812/2003 of the notary Xxxxx Xxxxx in Marl, registered in the
land register of the local court of Marl, folio 5528, is concluded prior to Closing.
(i) Except to the extent otherwise permitted under Section 6(c)(ii), Parent and each Seller
agrees that, during the period beginning on the Closing Date and ending on the third anniversary of
the Closing Date (the “Restricted Period”), neither Parent nor either Seller nor any of
their Affiliates shall, directly or indirectly, engage in the manufacture or sale of Products other
than Excluded Products (the “Restricted Activity”).
(ii) Notwithstanding anything to the contrary contained in Section 6(c)(i), Buyer hereby
agrees that the provisions set forth in such clause shall not prohibit or restrict in
48
any way Parent, either Seller or any of their Affiliates from directly or indirectly engaging in the
following activities:
(A) the purchase, manufacture, marketing, distribution, sale, research or development by
Parent, either Seller or any of their Affiliates of any materials used as a raw material in the
manufacture of Products;
(B) the purchase of Products from another Person (excluding any Affiliate of Parent or either
Seller), the incorporation of Products into any material, and the manufacture, marketing,
distribution, sale, supply or sale of such material by Parent, either Seller or any of their
Affiliates;
(C) the ownership by Parent, either Seller or any of their Affiliates, individually or in the
aggregate, of 8% or less of the outstanding voting securities of any Person engaged in the
Restricted Activity, regardless of whether or not such securities are listed on a national or
foreign securities exchange or on the NASDAQ National Market;
(D) the acquisition by Parent, either Seller or any of their Affiliates of any Person (whether
through the purchase of stock or assets or by way of merger, consolidation or other transaction)
engaged in the Restricted Activity (the “Acquired Person”) so long as the gross sales of
the Restricted Activity of such Acquired Person do not exceed 8% of the total gross sales of such
Acquired Person during the trailing 12-month period ended as of the last day of the calendar month
that is at least 30 days but not more than 60 days prior to the date that the definitive
documentation with respect to such acquisition is executed; or
(E) the engagement in the Restricted Activity by any Person (other than by or through Parent
or either Seller) that acquires Control of Parent or either Seller (an “Acquiring
Business”); provided, however, that such Person is not an Affiliate of Parent or either Seller
as of the date hereof and was not an Affiliate of Parent or either Seller immediately prior to the
transaction pursuant to which such Person acquired Control of Parent or such Seller.
(iii) Subject to the restrictions in the succeeding sentence, if Parent or either Seller,
directly or through any of their Affiliates, acquires during the Restricted Period any interest in
a Person conducting the Restricted Activity in accordance with Section 6(c)(ii)(D) above, Parent or
such Seller shall give Buyer written notice of such acquisition promptly after such acquisition is
completed and in such notice shall offer to sell to Buyer that portion of the business of the
acquired entity engaged in the Restricted Activity (a “Restricted Business”) at a price
equal to the Applicable Multiple and Metric of the Restricted Business. “Applicable Multiple
and Metric” means the multiple and metric (including the time period over which such metric is
measured) used to determine the price paid by Parent or such Seller to make such acquisition.
Buyer shall have 60 days from the date such notice is deemed effective pursuant to Section 11(g) to
determine whether to purchase the Restricted Business. During such 60-day period, Parent or such
Seller shall make available to Buyer such books and records regarding the Restricted Business as
Buyer shall reasonably request, subject to Buyer entering into a customary confidentiality
agreement. If Buyer gives Parent or such Seller written notice of its acceptance
49
of such offer
within such 60-day period, then such parties shall use commercially reasonable efforts to close
such transaction as soon as reasonably practicable thereafter. If Buyer gives Parent or such
Seller written notice that it rejects such offer or if Buyer fails to give Parent or such Seller
written notice accepting such offer within such 60-day period, then Parent or such Seller shall
have the right to operate such Restricted Business as it sees fit in its sole discretion,
except that neither Parent nor either Seller nor any of their Affiliates shall, directly or
indirectly, (A) disclose any confidential or proprietary information related to the Purchased
Assets to the Restricted Business or (B) license or otherwise permit the Restricted Business to use
any of the Transferred Intellectual Property (1) during the time that Parent, either Seller or any
of their Affiliates own any interest in such Person (and such Person continues to engage in the
Restricted Business), (2) in connection with the sale of such Person to any Person that is not an
Affiliate of Parent or either Seller, or (3) thereafter.
(iv) Except to the extent otherwise permitted under Section 6(c)(ii), Parent and each Seller
agrees that, during the Restricted Period, neither Parent nor any Seller nor any of their
Affiliates shall: (A) cause, solicit, induce or encourage any Employees to leave such employment,
provided, however, this prohibition shall not apply to any Employee who responds to a public
solicitation not targeted directly at such Employee or the Business; or (B) cause, induce or
encourage any material customer or supplier of the Business to terminate or modify any such
relationship. Additionally, Parent and each Seller agree that, during the two-year period
following the Closing Date, neither Parent nor any Seller nor any of their Affiliates shall hire,
employ or otherwise engage the services of any of the Persons set forth on Schedule
6(c)(iv), unless Buyer has terminated such Person’s employment with Buyer or Buyer’s Affiliate
prior thereto.
(v) From and after the date hereof, Parent and Sellers shall not and shall cause their
Affiliates and their respective officers and directors not to, directly or indirectly, disclose,
reveal, divulge or communicate to any Person other than authorized officers, directors and
employees of Buyer or use or otherwise exploit for its own benefit or for the benefit of anyone
other than the Buyer, any Confidential Information (as defined below). Sellers and their officers,
directors and Affiliates shall not have any obligation to keep confidential any Confidential
Information if and to the extent disclosure thereof is specifically required by law;
provided, however, that in the event disclosure is required by applicable law,
Sellers shall, to the extent reasonably possible, provide Buyer with prompt notice of such
requirement prior to making any disclosure so that Buyer may seek an appropriate protective order.
For purposes of this Section 6(c)(v), “Confidential Information” means any information with
respect to the Business, including methods of operation, customers, customer lists, products,
prices, fees, costs, Technology, inventions, trade secrets, Know-How, Software, marketing methods,
plans, personnel, suppliers, competitors, markets or other specialized information or proprietary
matters. Confidential Information does not include, and there shall be no obligation hereunder
with respect to, information that (i) is generally available to the public on the date of this
Agreement or (ii) becomes generally available to the public other than as a result of a disclosure
not otherwise permissible thereunder.
50
(vi) The Parties acknowledge and agree that the time, scope, and other provisions of this
Section 6(c) have been specifically negotiated by sophisticated commercial parties and specifically
hereby agree that such time, scope and other provisions are reasonable under the circumstances.
The Parties further agree that if, at any time, despite the express agreement of the Parties, a
court of competent jurisdiction holds that any portion of this Section 6(c) is unenforceable
because any of the restrictions therein are unreasonable, or for any other reason, such decision
shall not affect the validity or enforceability of any of the other provisions of this Agreement,
and the maximum restrictions of time or scope reasonable under the
circumstances, as determined by such court, will be substituted for any such restrictions
which are held unenforceable.
(i) Tax Indemnification. Except to the extent taken into account in determining the
Final Working Capital, Sellers hereby agree, jointly and severally, to be liable for and to
indemnify and hold Buyer and its Affiliates (including the Companies) and their respective
stockholders, officers, directors, employees, agents and assigns (collectively, the “Buyer
Indemnified Parties”) harmless from and against, and pay to the Buyer Indemnified Parties the
amount of, any and all losses or damages resulting from, arising out of, or incurred with respect
to, any claims that may be asserted by any party, based on, attributable to, or resulting from (i)
all Taxes of or with respect to the Companies (or any predecessors thereof) or attributable to the
Purchased Assets (A) for any taxable period ending on or before the Closing Date, (B) for the
portion of any Straddle Tax Period ending at the close of business on the Closing Date (determined
as provided in Section 6(e)(iv) and Section 6(e)(v)) and for the avoidance of doubt including any
trade Tax (Gewerbesteuer) triggered on the level of Infraserv due to the transactions contemplated
by this Agreement; and (C) for any taxable period ending after the Closing Date to the extent
additional VAT is levied based upon Section 1 para. 1a 3rd sentence, Sections 15(a) or 17 of the
German VAT Act and is related to supplies made or received prior to the Closing Date; (ii) the
failure of any of the representations and warranties contained in Section 3(m) to be true
and correct (determined without regard to any qualification related to materiality contained
therein) or the failure to perform any covenant contained in this Agreement with respect to Taxes;
(iii) any Seller Taxes; and (iv) any liability or obligation provided for under Section 75, 73 of
the German General Tax Code (Abgabenordnung) or Section 1 (para. 1a of the German VAT Act) or any
similar provision which relates to Taxes incurred by Sellers or the Companies in a taxable period
or portion thereof ending on or prior to the Closing Date. By way of clarification, with respect
to any losses or damages arising out of a matter that constitutes both a breach of a representation
or warranty and an Excluded Liability, such losses and damages shall be treated as an Excluded
Liability and Sellers’ indemnification obligation hereunder shall not require Sellers to indemnify
the Buyer Indemnified Parties against the same losses and damages twice.
51
(ii) Sales and Transfer Taxes. All sales and transfer taxes other than VAT (including
real property transfer taxes and including such taxes accrued at the level of Infraserv Oberhausen)
arising in connection with the sale and transfer of the Purchased Assets will be shared equally
between Buyer, on the one hand, and Sellers on the other hand, and Buyer or Sellers, as the case
may be, will file, to the extent required by applicable law, all necessary Tax Returns required to
be supplied to any Taxing Authority with respect to such sales and transfer Taxes.
(A) Sellers shall cause each Company to timely file all Tax Returns required to be
filed by it on or prior to the Closing Date and shall pay or cause to be paid all Taxes
shown due thereon. All such Tax Returns shall be prepared in a manner consistent with prior
practice. Sellers shall provide Buyer with copies of such completed Tax Returns at least
twenty days prior to the due date for filing thereof, along with supporting workpapers, for
Buyer’s review and approval, such approval not to be unreasonably withheld or delayed.
(B) Buyer will be responsible for the preparation and filing of all Tax Returns in
respect of the Purchased Assets and the Companies which are due after the Closing Date
(other than for Taxes with respect to periods for which the consolidated, unitary, and
combined Tax Returns of Sellers will include the operations of any of the Companies or the
Purchased Assets); provided, however, that, for any Tax Return for Taxes for
which Buyer is to be indemnified under Section 6(e)(i), Buyer shall provide the Sellers with
copies of such completed Tax Returns at least twenty days prior to the due date for filing
thereof, along with supporting workpapers, for the Sellers’ review and approval, such
approval not to be unreasonably withheld or delayed. Subject to the rights to payment from
the Sellers under paragraph (C) below, Buyer will make all payments required with respect to
any such Tax Return.
(C) In the event of any disagreement between the Sellers and Buyer with respect to any
Tax Return for which the other party has the right of review and approval (as described in
paragraphs (A) and (B) above), the Sellers and Buyer shall attempt in good faith to resolve
any such disagreement regarding such Tax Return prior to the due date for filing. In the
event that the Sellers and Buyer are unable to resolve any dispute with respect to such Tax
Return at least ten days prior to the due date for filing, such dispute shall be resolved
pursuant to Section 6(e)(xi), which resolution shall be binding on the parties.
(D) Not later than five days prior to the due date for the payment of Taxes on any Tax
Returns which Buyer has the responsibility to cause to be filed pursuant to paragraph (B)
above, the Sellers shall pay to Buyer the amount of Taxes as reasonably determined by Buyer,
owed by the Sellers pursuant to the provisions of Section 6(e)(iv) and Section 6(e)(v). No
payment pursuant to this paragraph (D) shall excuse the Sellers from their indemnification
obligations pursuant to Section 6(e)(i) if the
52
amount of Taxes as ultimately determined (on
audit or otherwise) for the periods covered by such Tax Returns exceeds the amount of the
Sellers’ payment under this paragraph (D).
(iv) Straddle Period Tax Allocations. Each Company will, unless prohibited by
applicable law, close the taxable period of such Company as of the close of business on the Closing
Date. For the avoidance of doubt, no Company is obligated to change its fiscal year (other than as
provided for in Section 5(i)) to end as of the Closing Date. If applicable law does not permit a
Company to close its taxable year on the Closing Date, Taxes (other than property taxes which are
subject to the provisions of Section 6(e)(v) below), if any, attributable to such Straddle Tax
Period shall be allocated (i) to the Sellers for the period up to and including the close of
business on the Closing Date, and (ii) to Buyer for the period subsequent to the Closing
Date. Any allocation of income or deductions required to determine any Taxes attributable to
a Straddle Tax Period shall be made by means of a closing of the books and records of each Company
as of the close of the Closing Date, provided that exemptions, allowances or deductions
that are calculated on an annual basis (including, but not limited to, depreciation and
amortization deductions) shall be allocated between the period ending on the Closing Date and the
period after the Closing Date in proportion to the number of days in each such period. Buyer shall
be responsible for any Tax resulting from transactions occurring after the Closing and prior to the
close of business of Closing Date outside of the Ordinary Course of Business and other than any
transactions contemplated by this Agreement.
(v) Property Taxes. Real and personal property Taxes relating to the Purchased Assets
and the Companies’ assets for the taxable period in which the Closing Date occurs will be equitably
prorated (in the event that final assessed Tax amounts are not available for the Closing, the
proration will be based upon the Tax xxxx for the last full finally assessed Tax year) between
Buyer and Sellers, as follows: Sellers shall be responsible for all such Taxes assessed for any
period up to and including the Closing Date, and Buyer shall be responsible for all such Taxes for
the period commencing with the day after the Closing. All Taxes will be prorated on the assumption
that an equal amount of Taxes applies to each day of the year, regardless of how any installment
payments are billed or made. Within 30 Business Days after any such Taxes prorated on an estimated
basis are finally assessed, Sellers shall pay to Buyer or Buyer shall pay to Sellers, as the case
may be, its proportionate share of any difference between the estimated and assessed Taxes.
(vi) Abatements, Refunds and Credits. Sellers shall be entitled to any abatements,
refunds or credits of Taxes relating to the Purchased Assets or the Companies for the period prior
to and including the Closing Date, net of any costs incurred or Taxes payable in respect of the
receipt of such abatements, refunds or credits. Buyer will promptly notify and forward to Sellers
the amounts of any such abatements, refunds or credits received by Buyer within 15 days after
receipt thereof. Any abatements, refunds and credits of Taxes relating to a Straddle Tax Period
shall be shared, net of any costs incurred or Taxes payable in respect of the receipt of such
abatements, refunds or credits, proportionately between Sellers and Buyer based on the portion of
the taxable period in question that each owned the Purchased Assets or the
53
Companies. Buyer shall
not amend any Tax Return of a Company covering any taxable period that ends on or prior to the
Closing Date unless required by law.
(vii) Tax Audits. After the Closing, Buyer will notify Sellers in writing, within
fifteen (15) days after its receipt of any correspondence, notice or other communications from a
Taxing Authority or any representative thereof, of any pending or threatened Tax audit, or any
pending or threatened judicial or administrative proceedings that involves Taxes relating to the
Purchased Assets or the Companies for the period prior to and including the Closing, and furnish
Sellers with copies of all correspondence received from any such Taxing Authority in connection
with any audit or information request with respect to any such Taxes relating to the Purchased
Assets or the Companies for the period prior to and including the Closing to the extent such
correspondence relates to an amount that is subject to indemnification by the Sellers pursuant to
Section 6(e)(i).
(viii) Tax Claims. Notwithstanding any provision of this Agreement to the contrary,
with respect to any Claim for abatement, refund, audit examination, notice of deficiency or
assessment or any judicial or administrative proceeding that involves Taxes relating to the
Purchased Assets or the Companies, (collectively, a “Tax Claim”), Buyer shall have the
right, at the expense of the Sellers to the extent such Tax Claim is subject to indemnification by
the Sellers pursuant to Section 6(e)(i) hereof, to represent the interests of the Companies
in any such Tax Claim (or to otherwise prosecute or contest such Tax Claim relating to the
Purchased Assets); provided, that with respect to a Tax Claim that is subject to
indemnification by the Sellers pursuant to Section 6(e)(i), (A) Buyer shall keep the Sellers
reasonably informed of the progress of such Tax Claim and consult seriously and in good faith with
the Sellers and their tax advisors with respect to any issue relating to such Tax Claim; (B) Buyer
shall provide the Sellers with copies of all correspondence, notice or other written materials
received from any Taxing Authorities and shall otherwise keep the Sellers and their tax advisors
advised of significant developments in the Tax Claim and of significant communications involving
representations of the Taxing Authorities; (C) Buyer shall provide the Sellers with a copy of any
written submission to be sent to a Taxing Authority prior to the submission thereof and shall give
serious and good faith consideration to any comments or suggested revisions that the Sellers or
their tax advisors may have with respect thereto; and (D) there will be no settlement, resolution,
or closing or other agreement with respect thereto without the consent of the Sellers, which
consent will not be unreasonably withheld.
(ix) Proration of Certain Expenses. Except as set forth in Sections 6(e)(i)
through 6(e)(viii), all expenses relating to the business operations of the Facilities and
Purchased Assets and the Companies that are normally pro-rated, including water and sewer use
charges, other charges in the nature of utility services, rents, permit, license, registration,
compliance or other fees for Permits, for the period prior to and including the Closing Date will
be for the account of Sellers, and all such expenses for the period after the Closing Date will be
for the account of Buyer, all as determined by the accrual method of accounting. All prorations
will be made on the basis of the actual number of days of the month or year, as applicable, which
will have elapsed as of the Closing Date and based upon a 365-day year. Sellers shall prepare a
good-faith estimate of each Party’s respective pro-rated share of such expenses as of the Closing
54
Date. At the Closing, such estimate shall be compared to the actual expenses that have been paid
as of the Closing by Sellers, and the Parties shall make such payments to each other as may be
required in order to cause the Sellers’ actual expenses paid as of the Closing conform to Sellers’
estimated pro-rata portion of such expenses. Within 90 days following the Closing, Sellers shall
calculate the actual expenses relating to the business operations of the Facilities and the
Purchased Assets and the Companies and the pro-rata portion of same for each of Sellers and Buyer
as of the Closing Date and the difference, if any, between such actual pro-rata portions of such
expenses for each of Sellers and Buyer and the estimated pro-rata portions of such expenses for
each of Sellers and Buyer prepared by Sellers in accordance with this Section 6(e)(ix),
which difference, if any, shall be set forth in writing by Sellers. Payment of the difference
(which difference shall be adjusted to account for any actual payment made between the Parties on
the Closing Date as contemplated by this Section 6(e)(ix) shall be made within 10 business
days following delivery of such written statement by wire transfer in US dollars in immediately
available funds to the account designated by the recipient Party and delivered to the paying Party.
(x) Costs and Expenses. Except to the extent specifically provided herein, whether or
not the transactions contemplated hereby are consummated, all costs and expenses incurred in
connection with this Agreement and the transactions contemplated hereby shall be borne by the Party
incurring such costs and expenses. Notwithstanding anything to the contrary herein, Buyer will be
responsible for (A) all costs and expenses associated with the obtaining of any title insurance
policy and all endorsements thereto that Buyer elects to obtain, (B) all fees and expenses of any
nature whatsoever incurred in obtaining the approval of any Governmental Entity for the payment by
Buyer of the Estimated or Final Purchase Price hereunder, and (C) all costs and fees in connection
with the assignment of the registered Transferred Intellectual Property and the Real Property to
Buyer before any Governmental Entity (except any costs incurred to clear Sellers’ title prior to
such assignment). Sellers and Buyer each represent and warrant to the other, respectively, that,
except as set forth on Schedule 6(e)(x), no broker, finder or other person is entitled to
any brokerage fees, commissions or finder’s fees in connection with the transaction contemplated
hereby by reason of any action taken by the party making such representation. Each of Sellers and
Buyer will pay to the other, or otherwise discharge, and will indemnify and hold the other harmless
from and against, any and all Claims for all brokerage fees, commissions, and finders’ fees (other
than as described above) incurred by reason of any action taken by the indemnifying party.
(xi) Disputes. Any dispute as to any matter covered hereby shall be resolved by an
independent accounting firm mutually acceptable to Sellers and Buyer. The fees and expenses of
such accounting firm shall be borne equally by Sellers, on the one hand, and Buyer on the other.
If any dispute with respect to a Tax Return is not resolved prior to the due date of such Tax
Return, such Tax Return shall be filed in the manner which the party responsible for preparing such
Tax Return deems correct.
(xii) Time Limits. Any claim for indemnity under this Section 6(e) may be made at any
time prior to 60 days after the expiration of the applicable Tax statute of limitations
55
with respect to the relevant taxable period (including all periods of extension, whether automatic or
permissive).
(xiii) Exclusive Tax Remedy. The indemnification provided for in this Section 6(e)
shall be the sole remedy for any claim in respect of Taxes, including any claim arising out of or
relating to a breach of Section 3(m). In the event of a conflict between the provisions of this
Section 6(e), on the one hand, and the provisions of Section 8, on the other, the provisions of
this Section 6(e) shall control. For the avoidance of doubt, the indemnity for Taxes provided for
in this Section 6(e) shall not be subject to the “Indemnification Threshold” or
“Indemnification Cap” as set forth in Section 8(e) or the minimum €20,000 threshold
described in the last sentence of Section 8(e).
(xiv) U.S. Entity Classification Election. Parent shall make or cause to be made a
U.S. entity classification election pursuant to Treasury regulation § 301.7701-3(c) (“U.S.
Election”) with respect to the Entire Eoxo Interest after acquiring the Degussa Interest and
prior to the Closing Date. The effect of such U.S. Election shall be to treat Eoxo as a
disregarded entity for U.S. federal income tax purposes prior to the Closing Date.
(i) Information and Administrative Support. For a period of seven years after the
Closing Date (or, if requested in writing by Sellers within seven years after the Closing Date,
until the closing of the examination of Sellers’ federal and state income Tax Returns for all
periods prior to and including the Closing Date, if later), Buyer agrees that it will, promptly
following the request of any Seller and at Sellers’ expense, provide such information and
administrative support as will be reasonably requested by any Seller to enable Sellers to comply
with its obligations with respect to the issuance of Forms W-2, 1099 and other Tax reports, reports
and notices relating to pension, profit sharing, health and other plans, income Tax Returns,
preparation of financial statements and completion of Sellers’ audit for the two fiscal years ended
December 31 following the Closing Date, and other similar matters.
(ii) Books and Records. For a period of seven years after the Closing Date (or, if
requested in writing by Sellers within seven years after the Closing Date, until the closing of the
examination of Sellers’ federal and state income Tax Returns for all periods prior to and including
the Closing Date, if later), Buyer will not dispose of any Records relating to any of the Purchased
Assets or the Companies’ assets delivered to it by Sellers without first giving notice to Sellers
of its intent to so dispose of such Records, and permitting Sellers to retain or copy such Records
at Sellers’ expense as Sellers may select. During such period, Buyer will permit Sellers to
examine and make copies, at Sellers’ expense, of such Records for any reasonable purpose, including
any litigation now pending or hereafter commenced against any Seller, or the preparation of Tax
Returns.
56
(iii) Employees. For a period of six years after the Closing Date, Buyer will make
available to Sellers on a reasonable basis and as requested from time to time by Sellers after the
Closing Date at Sellers’ expense, those of Buyer’s employees with knowledge of, or relevant to, the
matters described in this Section 6(f) for the purpose of consultation, investigation or testimony
in connection therewith.
(iv) Return of Records. After the Closing Date, Buyer shall deliver to Sellers any
records of Sellers transferred to Buyer pursuant to this Agreement if such records (A) were
transferred to Buyer by mistake, (B) are unrelated to the Purchased Assets or the Companies’ assets
or (C) were not otherwise contemplated to be transferred to Buyer pursuant to this Agreement.
Buyer shall be obligated to immediately deliver to Sellers the above-referenced records upon
Sellers’ request therefor or upon Buyer’s becoming aware of any such records.
(i) From and after the Closing Date, Sellers shall pay and discharge, in accordance with past
practice but not less than on a commercially reasonable timely basis, all accounts payable incurred
by Sellers or the Companies on or prior to the Closing Date in respect of the Business and included
in the Excluded Liabilities.
(ii) Sellers and Buyer agree that after the Closing Date they will hold in trust and will
promptly transfer and deliver to the proper recipient thereto, from time to time as and when
received by them, any cash, checks with appropriate endorsements (using their commercially
reasonable efforts not to convert such checks into cash), or other property that they may receive
on or after the Closing which properly belongs to the other party, including without limitation,
any insurance proceeds, and will account to the other for all such receipts.
(A) a Seller and/or any Affiliate of any Seller is held liable for any Liabilities
arising out of or in connection with (i) the conduct of the business of, or any action taken
by a Seller and/or any Affiliate of any Seller with respect to, any Company, European
Pipeline, Xxx-Xxxxxxxxxx GmbH or Studiengesellschaft mbH or (ii) a Seller and/or any
Affiliate of any Seller being directly or indirectly a partner or shareholder of such
Company, European Pipeline, Xxx-Xxxxxxxxxx GmbH or Studiengesellschaft mbH, in each case, to
the extent any Claim is made against a Seller and/or any Affiliate of any Seller or a Seller
and/or any Affiliate of any Seller is held liable by a third party (including any
Governmental Entity), or a Company, European Pipeline, Xxx-Xxxxxxxxxx GmbH or
Studiengesellschaft mbH, and such Seller would not be liable to Buyer under this Agreement
for such Claim; or
57
(B) a Seller and/or any Affiliate of any Seller is held liable by any third party or a
Company (1) as former unlimited partner of Infraserv Oberhausen under Sections 161 para. 2,
Section 160 para. 1 German Commercial Code (Handelsgesetzbuch) or (2) as former limited
partner of Infraserv Oberhausen under Section 172 para. 4 German Commercial Code
(Handelsgesetzbuch), provided that such Seller would not be liable to Buyer under this
Agreement for such liability.
This Section shall constitute with respect to Sellers and their Affiliates a contract for the
benefit of a third party.
(i) Transfer of Environmental Permits. Prior to and following the Closing, the
Parties agree to cooperate and take all actions reasonably necessary to effectuate the transfer of
Permits issued pursuant to Environmental Laws or, if the transfer of such Permits is not allowed
under Environmental Laws, the Parties agree to cooperate and take all actions reasonably necessary
to obtain new Permits required pursuant to Environmental Laws. To this end and without limiting
the generality of the foregoing, Sellers shall (a) transfer the existing Title V air permit at Bay
City to Purchaser and shall independently apply for any air permits required for the Sellers
retained operations, (b) use commercially best efforts to cause the Texas Commission on
Environmental Quality to separate the obligations under the Bay City Resource
Conservation and Recovery Act (“RCRA”) hazardous waste permit so that (A) the permit
issued to Buyer shall be limited to the two active RCRA units (the hazardous waste burning boilers
and the container storage area) and (B) Sellers obtain a permit or RCRA order to address all
corrective action obligations, including, but not limited to those associated with the RCRA closed
units and the RCRA Corrective Action Unit Landfill F-2/F-3.
(ii) Until such time as the Governmental Entities have transferred the RCRA permit to Buyer,
separated the obligation the obligation thereunder as set forth in subsection (j)(i) above and
approved the form of financial assurances that Buyer must post to continue to operate the two
active RCRA waste management units, Sellers shall maintain its financial assurances. Once the
Governmental Entities have accepted Buyer’s form of financial assurances and those assurances have
been put in place, Sellers shall be obligated only to maintain the financial assurances necessary
to satisfy the Governmental Entities with respect to the on-going RCRA investigation and
Remediation.
(iii) Single Site Petition. The Parties agree to join in filing single site petitions
pursuant to 30 TAC 101.2(b) for each of their Xxxxxx and Bay City operations.
58
(i) Buyer acknowledges that Sellers have the outstanding guarantees listed on Schedule
6(m) (collectively, the “Seller Guarantees”). Buyer and Sellers agree that, promptly
following the date hereof, they shall contact the beneficiaries of such Seller Guarantees, and
Sellers and Buyer shall use commercially reasonable efforts and cooperate (including arranging
meetings or telephone conferences with such beneficiaries) to obtain from the beneficiaries the
release of Sellers from the Seller Guarantees effective as of the Closing Date, and to obtain a
consent of such beneficiaries to accept replacement guarantees, letters of credit or other
financial assurances from the Lenders or other financial institutions. Sellers agree that
following the Closing they shall continue any remaining Seller Guarantees in an aggregate amount
not to exceed €40,000,000 (the “Continuing Guarantees”), and Buyer acknowledges that
Sellers may terminate prior to Closing any Seller Guarantees in excess of the Continuing
Guarantees; provided, however, that Sellers shall only be required to keep (A) the
Continuing Guarantees remaining outstanding for up to (and not more than) 30 days following the
Closing Date, and (B) Continuing Guarantees equal to not more than €10,000,000 in the aggregate
outstanding for 60 days following Closing. After the 60th day following Closing,
Sellers shall not be obligated to maintain any Seller Guarantees. Sellers’ termination of Seller
Guarantees in accordance with this Section 6(m) shall not constitute a breach of this Agreement and
Sellers shall have no Liability to Buyer by reason thereof, including without limitation any
Liability relating to termination of any Contract in accordance with its terms, the performance of
which is subject to such Seller Guarantees.
At Closing, Buyer will deliver counter guarantees in form and substance reasonably
satisfactory to Sellers to be issued by the Lenders or such other financial institutions as are
reasonably satisfactory to Sellers in favor of Sellers in respect of any Seller Guarantees not
terminated as of the Closing, and Buyer shall cause such counter guarantees to remain in place
until such Seller Guarantees are released. Sellers agree that, following the Closing, Sellers will
59
not modify (except for the termination of such Seller Guarantees in accordance with this Section
6(m)(i)) any such Seller Guarantees while they remain outstanding without Buyer’s prior written
consent, which shall not be unreasonably withheld or delayed.
(ii) With respect to the RWE Contract, (A) the Parties shall use their commercially reasonable
efforts to obtain prior to the Closing RWE Energie AG’s consent to the assignment of the RWE
Contract to Buyer, (B) to the extent that RWE Energie AG conditions the grant of its consent on
Buyer obtaining a guarantee or other form of financial assurance, from and after the date of this
Agreement Buyer will use its commercially reasonable efforts to obtain such guarantee or form of
financial assurance, and (C) if Buyer is unable to obtain RWE Energie AG’s consent, Buyer and
Sellers shall enter a lawful arrangement reasonably satisfactory to Buyer and Sellers that enables
Buyer to obtain the benefits of and assume the obligations under the RWE Contract as provided in
Section 2(a)(v).
(i) The representations and warranties set forth in Sections 3(a), 3(b), 3(k) and 3(n) shall
be true and correct at and as of the Closing Date, and the other representations and warranties set
forth in Section 3 above shall be, in the aggregate, true and correct in all material respects at
and as of the Closing Date, as if made on and as of such date, except to the extent that such
representations and warranties are qualified by terms such as “material,” “Material
Adverse Change” or “Material Adverse Effect,” in which case such representations and
warranties shall be, in the aggregate, true and correct in accordance with their respective terms
at and as of the
60
Closing Date, except for the entering of Contracts by Sellers and the Companies in
the Ordinary Course of Business for which Buyer’s consent is not required by Section 5(c)(ii) and
such other actions to which Buyer has consented in writing;
(ii) Sellers shall have performed and complied with all of its covenants hereunder in all
material respects through the Closing, except to the extent that such covenants are qualified by
terms such as “material,” “Material Adverse Change” or “Material Adverse
Effect,” in which case Sellers shall have performed and complied with all of such covenants in
all respects through the Closing;
(iii) There shall not be any injunction, judgment, order, decree, ruling, or charge in effect
preventing consummation of any of the transactions contemplated by this Agreement;
(iv) Sellers shall have delivered to Buyer a certificate duly executed by an authorized
representative to the effect that each of the conditions specified in Sections 7(a)(i) and (ii) is
satisfied in all respects;
(v) Sellers shall have delivered to Buyer the Deeds, the Assignment Agreement, the FIRPTA
Affidavit and stock powers or other appropriate transfer instruments with respect to the Acquired
Share Interests, the Ancillary Shares and the Purchased Assets, each duly executed by the
applicable Sellers and evidencing the transfer of the Purchased Assets and the Assumed Liabilities
to Buyer;
(vi) Sellers shall have delivered to Buyer the Ancillary Agreements, duly executed by Sellers;
(vii) Each Seller shall have executed and delivered to Buyer a certificate as to: (A)
resolutions (or other corporate instruments as applicable) embodying all corporate and partnership
actions taken by and on behalf of such Person to authorize the execution, delivery and performance
of this Agreement by such Person; and (B) the incumbency of each officer signing this Agreement or
any agreement, document or instrument executed in connection with this Agreement or the
transactions contemplated by this Agreement on behalf of such Person;
(viii) The consent of each Relevant Competition Authority shall have been obtained;
(ix) The consent of each Person set forth on Schedule 7(a)(ix) to the transactions
contemplated by this Agreement, to the extent required in order to consummate the transactions
contemplated by this Agreement, shall have been obtained (the “Material Consents”),
provided, however, that a Material Consent shall not constitute a condition to Closing hereunder to
the extent that Sellers provide, with Buyer’s reasonable cooperation, a lawful arrangement
reasonably satisfactory to Buyer and Sellers as provided in Section 2(a)(v) that enables Buyer to
obtain the benefits of and assume the obligations under the Contract with respect to which the
Material Consent has not been obtained in substantially the same manner as if such Material Consent
had been obtained;
61
(x) The Eoxo Transaction shall have been completed;
(xi) A release and discharge of the Deutsche Bank Liens shall have been obtained;
(xii) There shall not have occurred any event which would or would reasonably be expected to
have a Material Adverse Effect; and
(xiii) Except for the Contracts listed on Schedule 7(a)(xiii) and except as otherwise
expressly contemplated by this Agreement, Sellers shall have caused the termination of (A) all
Contracts between any Seller or its Affiliate, on the one hand, and any Company, on the other hand,
and (B) all Contracts between any Seller or its Affiliate, on the one hand, and any other Seller
and its Affiliate, on the other hand, that relate to the Business and if not terminated would be
included in the Purchased Assets or Assumed Liabilities.
Buyer may waive any condition specified in this Section 7(a) if it executes a writing so stating at
or prior to the Closing.
(i) the representations and warranties set forth in Sections 4(a) and 4(b) shall be true and
correct at and as of the Closing Date, and the other representations and warranties set forth in
Section 4 above shall be, in the aggregate, true and correct in all material respects at and as of
the Closing Date, as if made on and as of such date, except to the extent that such representations
and warranties are qualified by terms such as “material,” “Material Adverse Change” or “Material
Adverse Effect,” in which case such representations and warranties shall
be, in the aggregate, true and correct in accordance with their respective terms at and as of
the Closing Date;
(ii) Buyer shall have performed and complied with all of its covenants hereunder in all
material respects through the Closing, except to the extent that such covenants are qualified by
terms such as “material,” “Material Adverse Change” or “Material Adverse
Effect,” in which case Buyer shall have performed and complied with all of such covenants in
all respects through the Closing;
(iii) There shall not be any injunction, judgment, order, decree, ruling, or charge in effect
preventing consummation of any of the transactions contemplated by this Agreement;
(iv) Buyer shall have delivered to Sellers a certificate duly executed by an authorized
representative to the effect that each of the conditions specified in Sections 7(b)(i) and (ii) is
satisfied in all respects;
62
(v) Buyer shall have delivered to Sellers the Deeds and the Assignment Agreement,
evidencing the acceptance of the Purchased Assets and the assumption of the Assumed Liabilities by
Buyer;
(vi) Buyer shall have delivered to Sellers the Ancillary Agreements, duly executed by Buyer;
(vii) Buyer shall have delivered the Closing Payment to Sellers;
(viii) Buyer shall have executed and delivered to Sellers a certificate as to: (A)
resolutions embodying all corporate actions taken by and on behalf of such Person to authorize the
execution, delivery and performance of this Agreement; and (B) the incumbency of each officer
signing this Agreement or any agreement, document or instrument executed in connection with this
Agreement or the transactions contemplated by this Agreement on behalf of such Person;
(ix) The consent of each Relevant Competition Authority shall have been obtained;
(x) Each Material Consent shall have been obtained; provided, however, that a Material Consent
shall not constitute a condition to Closing hereunder to the extent that Sellers provide, with
Buyer’s reasonable cooperation, a lawful arrangement reasonably satisfactory to Buyer and Sellers
as provided in Section 2(a)(v) that enables Buyer to obtain the benefits of and assume the
obligations under the Contract with respect to which the Material Consent has not been obtained in
substantially the same manner as if such Material Consent had been obtained;
(xi) A release and discharge of the Deutsche Bank Liens shall have been obtained; and
(xii) U.S. Buyer shall have registered with the State of Texas for sales and use tax purposes.
Sellers may waive any condition specified in this Section 7(b) if Sellers execute a writing so
stating at or prior to the Closing.
63
forth in this Section 8(a). So long as an Indemnified Party asserts a Claim
for indemnification under and in accordance with this Section 8 for a breach by another Party of
any of its representations, warranties or covenants contained in this Agreement prior to the
expiration of the applicable survival period set forth in this Section 8(a), such Indemnified Party
shall be deemed to have preserved its rights to indemnification under this Section 8 regardless of
when such Claim is ultimately liquidated or resolved. Claims by Sellers relating to Assumed
Liabilities may be brought at any time following the Closing.
(i) If any third party shall notify any Party (the “Indemnified Party”) with respect
to any matter (a “Third Party Claim”) which may give rise to a Claim for indemnification
against any other Party (the “Indemnifying Party”) then the Indemnified Party shall
promptly (and in any event within ten Business Days after receiving notice of the Third Party
Claim) notify each Indemnifying Party thereof in writing. The failure to notify the Indemnifying
Party promptly of a Third Party Claim shall not relieve the Indemnifying Party from its
indemnification obligation hereunder, except to the extent that the Indemnifying Party is
materially prejudiced thereby.
(ii) Any Indemnifying Party will have the right at any time to assume and thereafter conduct
the defense of the Third Party Claim with counsel of its choice reasonably satisfactory to the
Indemnified Party; provided, however, that the Indemnifying Party shall not waive any defense,
cause of action or counterclaim or consent to the entry of any judgment or enter into any
settlement with respect to the Third Party Claim without the prior written consent of the
Indemnified Party (not to be withheld unreasonably). In the event that the Indemnifying Party
assumes the defense as provided in this Section 8(d), the Indemnified Party shall have the
64
right to participate in such defense (including with counsel of its choice), at its own expense, and the
Indemnifying Party shall reasonably cooperate with the Indemnified Party in connection with such
participation. In the event that the Indemnified Party shall in good faith determine that the
Indemnified Party may have available to it one or more defenses or counterclaims that are
inconsistent with one or more of those that may be available to the Indemnifying Party in
respect of any Third Party Claim or any litigation relating thereto, the Indemnified Party shall
have the right at all times to take over and assume control over the defense, settlement,
negotiations or litigation relating to any such Third Party Claim at the sole cost of the
Indemnifying Party; provided, however, that if the Indemnified Party does so take over and assume
control, the Indemnified Party shall not consent to the entry of any judgment or enter into a
settlement with respect to such Third Party Claim without the prior written consent of the
Indemnifying Party (not to be withheld unreasonably).
(iii) Unless and until an Indemnifying Party assumes the defense of the Third Party Claim as
provided in Section 8(d)(ii) above, however, the Indemnified Party may defend against the Third
Party Claim in any manner it reasonably may deem appropriate, on behalf of and for the risk of the
Indemnifying Party and the Indemnifying Party shall be liable for the reasonable fees and expenses
of counsel employed by the Indemnified Party for any period during which the Indemnifying Party has
not assumed the defense thereof.
(iv) In no event will the Indemnified Party consent to the entry of any judgment or enter into
any settlement with respect to the Third Party Claim without the prior written consent of the
Indemnifying Party (not to be withheld unreasonably).
(v) The Party assuming the defense under this Section 8(d) shall keep the appropriate Parties
reasonably informed regarding the progress and status thereof.
(vi) In the event any Indemnified Party should have a Claim against any Indemnifying Party
hereunder which does not involve a Third Party Claim, the Indemnified Party shall promptly transmit
to the Indemnifying Party a written notice (the “Indemnity Notice”) describing in
reasonable detail the nature of the Claim and the basis of the Indemnified Party’s request for
indemnification under this Agreement, provided, however, that failure of the Indemnified Party to
give the Indemnity Notice will not relieve the Indemnifying Party from liability hereunder unless
and solely to the extent that the Indemnifying Party did not otherwise learn of such Claim and such
failure results in the forfeiture by the Indemnifying Party of substantial rights and defenses, and
will not in any event relieve the Indemnifying Party from any obligations to the Indemnified Party
other than the indemnification obligation provided herein. In the event that the Indemnifying
Party disputes the validity or scope of the Claim set forth in the Indemnity Notice, the parties
will use their good faith efforts to resolve such matter within 30 days of receipt of the Indemnity
Notice. If the dispute is not resolved during such 30-day period, such matter shall be resolved in
accordance with Section 11(h).
65
such
Claim (net of any resulting increase in insurance premiums and any expenditures made in connection
with obtaining such insurance recovery). Sellers shall not be required to indemnify Buyer under
Section 8(b)(i) with respect to any Claims, and Buyer shall not be required to indemnify Sellers
under Section 8(c)(i) with respect to any Claims, until the aggregate amount of all such Claims
against Seller, or against Buyer, as the case may be, exceeds an amount equal to €5,000,000 (the
“Indemnification Threshold”), in which case the
Indemnifying Party shall only be liable for the amount of all Claims in excess of the
Indemnification Threshold. Sellers’ aggregate liability to Buyer, and Buyer’s aggregate liability
to Sellers, for Claims arising from this Agreement under Section 8(b)(i) or Section 8(c)(i) each
shall be limited to an amount equal to €50,000,000 (the “Indemnification Cap”).
Notwithstanding anything to the contrary in this Section 8, in no event shall Buyer or Sellers be
entitled to indemnification under Section 8(b)(i) or Section 8(c)(i) with respect to any individual
Claim arising out of a breach of any representation or warranty other than the representations and
warranties set forth in Section 3(o) unless the amount of the individual Claim for which
indemnification is being sought by such Party exceeds €20,000 (without regard to any materiality
qualifiers in such representation or warranty), but any such otherwise indemnifiable Claim that
does not exceed €20,000 shall not be taken into account in calculating whether the Indemnification
Threshold has been satisfied. Notwithstanding the foregoing, breaches of representations and
warranties in Sections 3(a), 3(b), 3(k)(i), 3(k)(ii), 3(m), 3(n), 4(a) and 4(b) shall not be
subject to the Indemnification Threshold or Indemnification Cap. By way of clarification, with
respect to any Claims arising out of a matter that constitutes both a breach of a representation or
warranty and an Excluded Liability, such Claims shall be treated as an Excluded Liability and
Sellers’ indemnification obligation hereunder shall not require Sellers to indemnify the Buyer
Indemnified Parties against the same Claims twice.
66
(i) Environmental Conditions which (a) are known as of the Closing, or (b) are associated with
Hazardous Substances present or Released at the Facilities prior to the Closing but no longer used
by the Business as of the Closing, including the Hazardous Substances being investigated and/or
remediated as of the Closing (collectively “Historic Use Contamination”), including any
third-party claim for loss of life, or injury to persons or property to the extent caused (or
allegedly caused) by the Historic Use Contamination;
(ii) Environmental Conditions which are unknown as of the Closing and relate to Hazardous
Substances present or Released at the Facilities on or prior to the Closing, and still used by the
Business as of the Closing (“Pre-Closing Business Related Contamination”), including any
third-party claim for loss of life, or injury to persons or property to the extent caused (or
allegedly caused) by the Pre-Closing Business Related Contamination, but only to the extent of
Sellers’ applicable cost-sharing percentage as described in Section 9(e); and
(iii) Environmental Conditions at any real property not included in the Facilities, which was
either (x) owned, operated, leased or used by the Companies or Sellers for the Business
(“Former Sites”) or (y) used by the Companies or Sellers with respect to the Business for
the off-site disposal or treatment of Hazardous Substances (“Disposal Sites”) on or prior
to the Closing Date (collectively “Excluded Environmental Liabilities”), including any
third-party claim for loss of life, or injury to persons or property to the extent caused (or
allegedly caused) by Excluded Environmental Liabilities; and
(i) Pre-Closing Business Related Contamination, but only to the extent of Buyer’s applicable
cost-sharing percentage as described in Section 9(e);
(ii) Environmental Conditions associated with Hazardous Substances Released at the Facilities
after the Closing, including any third-party claim for loss of life, or injury to persons or
property to the extent caused (or allegedly caused) by such Environmental Conditions or Release;
and
(iii) Any violation of the terms and conditions of any Environmental Permit or any portion
thereof applicable to the Purchased Assets until such Environmental Permits are transferred or
reissued to Buyer or Buyer Indemnified Party.
67
(i) To the extent acceptable to the Governmental Entities with jurisdiction over the
investigation or remediation of any Historic Use Contamination or Pre-Closing Business Related
Contamination, Buyer Indemnified Parties shall agree to the Sellers’ use of risk-based cleanup
standards appropriate for commercial and industrial sites to conduct Remediation and achieve
closure, including where appropriate deed restrictions and engineering controls, provided such
standards and restrictions do not unreasonably interfere with the operations of the Business or
impose any material undertakings or obligations on the Business or require the Business to obtain
any new Permits. Without limiting the foregoing, Sellers may elect to perform or have performed
the least costly Remediation allowed by Environmental Law and acceptable to the relevant
Governmental Entity, which is also reasonable in terms of the protection of the environment, health
and safety.
(ii) With respect to any Historic Use Contamination or Pre-Closing Business Related
Contamination, Sellers shall have no obligation to indemnify Buyer Indemnified Parties hereunder
for any Liabilities or Claims that result from: (A) any Buyer Indemnified Party undertaking any
testing, drilling or sampling of the Environment other than (1) as required by or necessary to
achieve compliance with applicable Environmental Law or as required by an order or directive of a
Governmental Entity or by an applicable Permit, or (2) as may be determined by Buyer in the
exercise of its commercially reasonable judgment to be necessary to (x) avoid or eliminate a
serious and current risk to human health or safety or the Environment or (y) respond to a pending
or threatened claim; (3) to carry out and in conjunction with a bona fide construction, renovation
or demolition project or emergency repair; or (4) with Sellers approval; or (B) any notification,
report, admission or disclosure of any pre-closing condition by Buyer to any Governmental Entities
except to the extent (1) required by Environmental Laws, Permits or any Order of a Governmental
Entity or (2) agreed to in writing by Sellers or (3) made in response to an emergency incident or
other exigent circumstance at a Facility, or (c) any Buyer Indemnified Party voluntarily undertakes
Remediation not required by or necessary to achieve compliance with Environmental Law other than in
conjunction with a bona fide construction, renovation or demolition project or emergency repair or
in response to an emergency incident or other exigent circumstances at a Facility.
(iii) With respect to the Historic Use Contamination or Pre-Closing Business Related
Contamination, Sellers shall have no obligation to indemnify Buyer Indemnified Parties
68
hereunder
for any of the increased Liabilities or Claims that arise directly from the gross negligence or
willful misconduct of any Buyer Indemnified Party or any successor in title to the Business or the
Companies or the related assets; provided, this is limited to the increased costs caused by such
conduct.
(iv) By way of clarification, with respect to any Claims or Liabilities arising out of a
matter that constitutes both a breach of a representation or warranty and an Excluded Environmental
Liability, such Claims or Liabilities shall be treated as an Excluded
Environmental Liability and Sellers’ indemnification obligation hereunder shall not require
Sellers to indemnify the Buyer against the same Claims and Liabilities twice.
(v) Buyer shall promptly notify Sellers following Buyer obtaining actual knowledge of any
intent by a Governmental Entity to amend, modify or otherwise require terms and conditions in an
Environmental Permit which contains or may reasonably lead to such Permit containing a requirement
for Remediation for which Sellers would be solely liable and, to the extent reasonably practical,
allow and cause each affiliated Buyer to allow Sellers and their representatives to attend and
participate in any discussions, site visits or meetings and to comment in advance (and to have
comments reasonably taken into account) on any material filings with respect to such Environmental
Permits; provided that Buyer shall have no obligation to take any position that would in Buyer’s
reasonable opinion would be expected to impose materially greater obligations on Buyer than would
be imposed without taking into account Sellers indemnity obligations hereunder. Neither Buyer nor
any Buyer Indemnified Party shall knowingly or intentionally offer or suggest that an Environmental
Permit contain any condition or provision requiring Remediation for which Sellers would be liable
under Section 9, in any correspondence or discussions with any Governmental Entity except with the
consent of Sellers, which consent shall not be unreasonably withheld; provided, however, that
nothing herein shall prevent Buyer Indemnified Parties from agreeing to such a condition if raised
or imposed by the Governmental Entity.
(vi) Remediation Derived Wastewater. With respect to sites on which Buyer or any
Buyer Indemnified Party operates a wastewater treatment plant, which plant has excess capacity,
Buyer agrees to accept at no charge to Sellers, any water or recovered groundwater produced in the
course of a Seller-controlled Remediation, to the extent accepting such waters is allowed by
Environmental Laws, including Buyer’s willingness to use commercially reasonable efforts to seek
modification or amendments to any relevant Permit so that it can accept such waters; provided,
Buyer shall not be required to modify or make any capital improvements to its wastewater treatment
plant; provided, further, Buyer shall have the right to impose a reasonable fee for such services
(such fee to be consistent with the methodology in the applicable U.S. or German Site Services
Agreement); if the costs are more than incidental to Buyer’s operations or otherwise raises
capacity issues for Buyer. Sellers shall indemnify Buyer Indemnified Parties for costs associated
with any disposal of waters, which are incompatible with Buyer’s wastewater treatment plant.
Should Buyer-controlled Remediation occur at Sellers’ Xxxxxx, Texas site, the provisions of this
Section 9(d)(vi) shall apply with the term “Buyer” replaced by “Sellers” and the term “Seller” or
“Sellers” replaced by “Buyer.”
69
*** The confidential portions of this exhibit have been filed separately with the Securities
and Exchange Commission pursuant to a confidential treatment request in accordance with Rule 24b-2
of the Securities and Exchange Act of 1934, as amended. The location of each omitted portion is
indicated by a series of three asterisks in brackets (“[***]”).
(vii) Remediation Derived-Soil Disposal. Where nonhazardous contaminated soil or
nonhazardous waste are generated in the course of Sellers-controlled Remediation, Buyer agrees that
Sellers shall have the right to construct new landfills on-site to accept such wastes, which
landfills shall be constructed in an area approved by Buyer, which approval shall not be
unreasonably withheld, denied or conditioned, and in compliance with applicable laws, including
Environmental Laws. Buyer agrees that Buyer and Buyer Indemnified Parties shall cooperate with
Sellers in the construction of the landfill, including, if required by Environmental Laws obtaining
new Permits in the name of Buyer or the relevant Buyer Indemnified Party to construct new on-site
landfills to accept such wastes. Sellers shall indemnify the Buyer Indemnified Parties for (a)
reasonable, third-party costs, expenses or capital expenditures incurred in the implementation of
this paragraph and (b) any Claims or Liabilities asserted against or imposed on Buyer Indemnified
Parties as a result of such Seller-controlled landfills. Should Buyer-controlled Remediation occur
at Sellers’ Xxxxxx, Texas site, the provisions of this Section 9(d)(vii) shall apply with the term
“Buyer” replaced by “Seller” and the term “Seller” or “Sellers” replaced by “Buyer.”
(viii) With respect only to [***] [***] [***] [***] [***] [***], prior to seeking recovery of
a claim against Sellers under this Article 9, Buyer shall use commercially reasonable efforts to
pursue such matter against [***] [***] [***] [***] [***] [***] [***] [***] [***] [***], including
pursuing claims pursuant to [***] [***] [***] [***] [***] [***] [***] [***] [***] [***],
provided Buyer shall not be required to commence litigation against [***], except as provided
in the penultimate sentence of this paragraph 9(d)(viii). While pursuing a claim against [***]
[***] [***] [***], Buyer shall keep Sellers reasonably informed of the progress of such claim and
consult in good faith with Sellers. Prior to settling or compromising such a claim, Buyers shall
seek Sellers’ approval, which shall not be unreasonably withheld. Should Buyer’s efforts fail to
enforce such a claim, Buyer shall, to the extent legally permissible, assign its relevant rights
pursuant to such contract between [***] [***] [***] to Sellers or, if not legally permissible,
shall exercise such rights at Sellers’ direction, benefit and cost. Sellers shall reimburse Buyer
for (a) all reasonable out-of-pocket costs and expenses incurred in enforcing such rights unless
such costs are recovered from [***] [***] [***] and (b) the shortfall in any settlement or
compromise reached with [***] [***] [***] under this paragraph.
| For Claims Made: | Sellers’ Percentage | Buyer’s Percentage | ||||||
On or before the First
Anniversary of the Closing
|
100 | % | 0 | % | ||||
After the First Anniversary of
the Closing but on or before
the Second Anniversary of the Closing
|
93 | % | 7 | % | ||||
70
| For Claims Made: | Sellers’ Percentage | Buyer’s Percentage | ||||||
After the Second Anniversary
of the Closing but on or
before the Third Anniversary
of the Closing
|
87 | % | 13 | % | ||||
After the Third Anniversary of
the Closing but on or before
the Fourth Anniversary of the
Closing
|
80 | % | 20 | % | ||||
After the Fourth Anniversary
of the Closing but on or
before the Fifth Anniversary
of the Closing
|
73 | % | 27 | % | ||||
After the Fifth Anniversary of
the Closing but on or before
the Sixth Anniversary of the
Closing
|
67 | % | 33 | % | ||||
After the Sixth Anniversary of
the Closing but on or before
the Seventh Anniversary of the
Closing
|
60 | % | 40 | % | ||||
After the Seventh Anniversary
of the Closing but on or
before the Eighth Anniversary
of the Closing
|
53 | % | 47 | % | ||||
After the Eighth Anniversary
of the Closing but on or
before the Ninth Anniversary
of the Closing
|
47 | % | 53 | % | ||||
After the Ninth Anniversary of
the Closing but on or before
the Tenth Anniversary of the
Closing
|
40 | % | 60 | % | ||||
After the Tenth Anniversary of
the Closing but on or before
the Eleventh Anniversary of
the Closing
|
33 | % | 67 | % | ||||
71
| For Claims Made: | Sellers’ Percentage | Buyer’s Percentage | ||||||
After the Eleventh Anniversary
of the Closing but on or
before the Twelfth Anniversary
of the Closing
|
27 | % | 73 | % | ||||
After the Twelfth Anniversary
of the Closing but on or
before the Thirteenth
Anniversary of the Closing
|
20 | % | 80 | % | ||||
After the Thirteenth
Anniversary of the Closing but
on or before the Fourteenth
Anniversary of the Closing
|
13 | % | 87 | % | ||||
After the Fourteenth
Anniversary of the Closing but
on or before the Fifteenth
Anniversary of the Closing
|
6 | % | 94 | % | ||||
After the Fifteenth
Anniversary of the Closing
|
0 | % | 100 | % | ||||
For the sake of clarity, this Cost-Sharing Formula shall not apply to Excluded Environmental
Liabilities or Historic Use Contamination.
(i) Remediation. Sellers shall control any Remediation governed by this Section 9;
provided, that with respect to Pre-Closing Business Related Contamination, the Party with
the higher cost-sharing percentage at the time the Claim for such Pre-Closing Business Related
Contamination is filed shall control the Remediation with respect to such Claim; provided,
further, that with respect to any Remediation of any Environmental Condition at the Facilities,
the Party that is not controlling the Remediation may monitor and participate in discussions with
respect to such Remediation at its sole cost and expense; and provided, further, that prior to
commencing any Remediation at a Buyer Facility, Sellers shall notify Buyer of its intent to
undertake Remediation and shall provide Buyer with a reasonable opportunity to review and comment
on any proposed plans or reports, work plans or other reports or documents associated with
Remediation and shall make a reasonable effort to incorporate any reasonable comments by Buyer on
such plans, reports or other documents. Buyer shall use commercially reasonable efforts to assist
Sellers in its obligations hereunder, including providing reasonable access to the Facilities and
Sellers agree to (i) not allow its activities to unreasonably interfere with the operation of the
Business, except to the extent required in order to comply with applicable law, (ii) use
environmental professionals reasonably acceptable to Buyer, possessing
72
reasonable levels of insurance, taking into account the nature of the project, and which name Buyer
Indemnified Parties as additional insureds, (iii) coordinate access with Buyer and to provide
reasonable advance notice when Seller or its consultants will be undertaking work at a Buyer
Facility.
(ii) Third-Party Claims for Damages. Claims made pursuant to this Section 9 not
involving Remediation at a Buyer Facility shall be governed by the procedures set forth in Section
8(d).
(i) Buyer and Sellers may terminate this Agreement by mutual written consent at any time prior
to the Closing;
(ii) Buyer or Sellers may terminate this Agreement if any Governmental Entity shall have
enacted, promulgated or issued any statute, rule, regulation, ruling, writ or injunction, or taken
any other action, restraining, enjoining or otherwise prohibiting the transactions contemplated
hereby and all appeals and means of appeal therefrom have been exhausted;
(iii) Buyer may terminate this Agreement by giving written notice to Sellers at any time prior
to the Closing (A) if any Seller has breached any representation, warranty or covenant contained in
this Agreement, such breach would result in the Closing condition set forth in Section 7(a)(i) or
(ii) not being met, Buyer has notified Sellers of the breach in writing, and the breach has
continued without cure for a period of 30 days after written notice of breach or is incapable of
being cured, or (B) if the Closing shall not have occurred on or before June 30, 2007, by reason of
the failure of any condition precedent under Section 7(a) hereof (unless the failure results
primarily from Buyer itself materially breaching any representation, warranty or covenant contained
in this Agreement); and
73
(iv) Sellers may terminate this Agreement by giving written notice to Buyer at any time prior
to the Closing (A) if Buyer has breached any representation, warranty or covenant contained in this
Agreement, such breach would result in the Closing condition set forth in Section 7(b)(i) or (ii)
not being met, Sellers have notified Buyer of the breach in writing, and the breach has continued
without cure for a period of 30 days after written notice of breach or is incapable of being cured,
or (B) if the Closing shall not have occurred on or before June 30, 2007, by reason of the failure
of any condition precedent under Section 7(b) hereof (unless the failure results primarily from
either Seller materially breaching any representation, warranty or covenant contained in this
Agreement).
(d) Succession and Assignment. This Agreement shall be binding upon and inure to the
benefit of the Parties named herein and their respective successors and permitted assigns. No
Party may assign either this Agreement or any of its rights, interest or obligations hereunder
without the prior written approval of the other Parties; provided, however, that a Party may assign
any of its rights or obligations under this Agreement to any of its Affiliates upon written notice
to the other Parties, but such assignment shall not constitute a release of the assigning Party,
which shall remain responsible for performing any assigned obligation in the event the assignee
fails to perform such obligation. Buyer, Parent and Sellers also may assign this
74
Agreement in whole or part by way of security to any bank or other financial institution on behalf
of itself or other creditors for the purpose of securing any obligations under banking or other
financings made or proposed to be made available to Buyer, Parent, any Seller or any Affiliate
thereof. Any purported assignment or delegation in violation of this Section 11(d) shall be null
and void.
| If to Parent or Sellers: | Celanese Corporation | |||
| 0000 Xxxx XXX Xxxxxxx | ||||
| Xxxxxx, XX 00000 | ||||
| Attention: Xxxxxx X. Xxxx, Esq., Executive Vice President, General Counsel and Corporate Secretary | ||||
| Fax: (000) 000-0000 | ||||
| With copy to: | Xxxxxxxx Xxxxxx LLP | |||
| One XX Xxxx Xxxxx | ||||
| Xx. Xxxxx, Xxxxxxxx 00000 | ||||
| Attention: Xxxxxx X. Xxxx, Esq. | ||||
| Fax: (000) 000-0000 | ||||
| If to Buyer: | Advent Oxo (Cayman) Limited | |||
| 00 Xxxxx Xxxxxx | ||||
| Xxxxxx, Xxxxxxxxxxxxx 00000 | ||||
| Attention: Xxxxx Xxxxxxx | ||||
| Fax: (000) 000-0000 |
75
| With copies to: | Advent International Corporation | |||
| 00 Xxxxx Xxxxxx | ||||
| Xxxxxx, Xxxxxxxxxxxxx 00000 | ||||
| Attention: | ||||
| Fax: (000) 000-0000 | ||||
| and | ||||
| Weil, Gotshal & Xxxxxx LLP | ||||
| Xxxxxxxxxxxx 0 (Xxxxxx) | ||||
| 00000 Xxxxxxxxx, Xxxxxxx | ||||
| Attention: Xxxxxxx Xxxxxxx | ||||
| Fax: 00 00 00000 000 | ||||
| and | ||||
| Weil, Gotshal & Xxxxxx LLP | ||||
| 000 Xxxxxxx Xxxxxx | ||||
| Xxxxxx, Xxxxxxxxxxxxx 00000 | ||||
| Attention: Xxxxxxx Xxxxxx | ||||
| Fax: (000) 000-0000 | ||||
| and | ||||
| Lovells | ||||
| Xxxxxxxxxxxxxxx 0 | ||||
| 00000 Xxxxxxxxx, Xxxxxxx | ||||
| Attention: Xxxxxxx Xxxxxxx | ||||
| Fax: 00 00 000 00 000 |
Any Party may change the address to which notices, requests, demands, Claims, and other
communications hereunder are to be delivered by giving the other Parties notice in the manner
herein set forth.
(i) This Agreement shall be governed by and construed and interpreted in accordance with the
substantive laws of the State of New York, without giving effect to any choice of law or conflicts
of law provision that would cause the application of the laws of a jurisdiction other than New
York; provided that the transfer of shares, partnership interests, real estate and other assets
shall be governed by the law that mandatorily applies thereto.
(ii) Any disputes, controversies or Claims arising out of or in connection with this
Agreement, including any question regarding its existence, validity or expiration but
76
excluding specific performance or injunctive relief sought under Section 11(m), shall be finally
and completely resolved without appeal by arbitration under the International Arbitration Rules of
the American Arbitration Association (“AAA Rules”) in force at the date of the request for
arbitration, which AAA Rules are deemed to be incorporated by reference into this clause; provided,
however, that in the event of any conflict between such rules and the other provisions of this
Agreement, such other provisions of this Agreement shall control. The arbitral tribunal shall
consist of three arbitrators, each of which shall be fluent in English. Each of Buyer, on the one
hand, and Sellers, on the other hand, shall appoint one arbitrator. If either Buyer or Sellers
fails to appoint an arbitrator within 30 days of receiving notice of an appointment of an
arbitrator by the other Party, such arbitrator shall at the request of either Buyer or Sellers be
appointed by the President of the American Arbitration Association. The two arbitrators so
appointed shall, within 30 days of the date of the appointment of the second arbitrator, appoint a
third arbitrator who shall act as the chairman of the tribunal. If the two arbitrators to be
appointed fail to agree upon a third arbitrator within 30 days of the appointment of the second
arbitrator, then the third arbitrator shall be appointed by the President of the American
Arbitration Association at the written request of either Buyer or Sellers. The arbitration
proceedings shall take place in New York, New York and the language of such proceedings, including
arguments and briefs, shall be English. Each party shall be entitled to reasonable discovery
rights, and issues as to discovery shall be determined by the arbitral panel applying to the laws
of New York without regard to principles of conflicts of laws. The award of the arbitrators shall
be by majority vote and shall be in writing, shall set forth the facts found by the arbitrators to
exist, their determination and the basis of their determination. Any award shall be made in US
dollars. Notwithstanding any provision of this Agreement which may be interpreted to the contrary,
the arbitral tribunal shall not have the authority to award consequential or punitive damages.
Each Party shall bear its own attorneys’ fees and expenses. The fees and expenses for the arbitral
panel shall be borne on a 50/50 basis by Buyer and Sellers. The award of the arbitral tribunal
shall be final and not subject to appeal and judgment upon the award may be entered in any
competent court.
77
proof shall arise favoring or disfavoring any Party by virtue of the authorship of any of the
provisions of this Agreement. Any reference to any federal, state or local or foreign statute or
law shall be deemed also to refer to all rules and regulations promulgated thereunder, unless the
context requires otherwise. The word “including” shall mean including without limitation.
The words “historical accounting methods” means the accounting methods and practices
historically used by the applicable Seller or Company, which (i) in the case of Sellers, Titan GmbH
and Infraserv Oberhausen, are in accordance with accounting principles generally accepted in the
United States, and (ii) in the case of Eoxo, are in accordance with accounting principles generally
accepted in Germany.
(m) Specific Performance. Each Party acknowledges and agrees that the other Parties
would be irreparably injured if any of the provisions of this Agreement are not performed in
accordance with their specific terms and that money damages may not or would not be an adequate
remedy in such event. Therefore, the non-breaching Party may be entitled to specific performance
of this Agreement and injunctive or other equitable relief to prevent breaches of this Agreement
and to specifically enforce the provisions hereof. Each Party agrees to waive any requirement for
the securing or posting of any bond in connection with any such remedy. For purposes of any action
for specific performance of this Agreement or other injunctive or equitable relief, each Party
irrevocably and unconditionally consents and submits to the exclusive jurisdiction and venue of the
U.S. federal courts situated in the Southern District of New York, and the Parties hereto hereby
irrevocably submit to the exclusive jurisdiction of such courts in such event. Each Party, to the
extent permitted by applicable law, hereby waives and agrees not to assert, by way of motion, as a
defense or otherwise, in any such suit, action or proceeding brought in such courts, any claim that
it is not subject personally to the jurisdiction of such courts, that its property is exempt or
immune from attachment or execution, that the suit, action or proceeding is brought in an
inconvenient forum, that the venue of the suit, action or proceeding is improper or that this
Agreement or the subject matter hereof may not be enforced in or by such court. Each Party
consents to the service of process in any suit, action or proceeding by the mailing of copies
thereof to such Party at any time at its address to which notices are to be given pursuant to
Section 11(g). Each Party agrees that its submission to jurisdiction and consent to service of
process by mail is made for the express benefit of the other Parties. Final judgment against any
Party in any such suit, action or proceeding shall be conclusive, and may be enforced in any other
jurisdiction (i) by suit, action or proceeding on the judgment, a certified or true copy of which
shall be conclusive evidence of the fact and the amount of liability of the party therein described
or (ii) in any other manner provided by or pursuant to the laws of such other jurisdiction.
78
79
| PARENT BUYER: ADVENT OXO (CAYMAN) LIMITED |
||||
| By | /s/ Xxxxxxx X. Xxxxxxxx | |||
| Name: | Xxxxxxx X. Xxxxxxxx | |||
| Title: | Director | |||
| U.S. BUYER: OXO TITAN US CORPORATION |
||||
| By | /s/ Xxxxxxx Xxxxxx | |||
| Name: | Xxxxxxx Xxxxxx | |||
| Title: | Managing Director | |||
| GERMAN HOLDCO: DRACHENFELSSEE 520. V V GMBH |
||||
| By | /s/ Xxxxxxx Xxxxxx | |||
| Name: | Xxxxxxx Xxxxxx | |||
| Title: | Managing Director | |||
| GERMAN BUYER: DRACHENFELSSEE 521. V V GMBH |
||||
| By | /s/ Xxxxxxx Xxxxxx | |||
| Name: | Xxxxxxx Xxxxxx | |||
| Title: | Managing Director | |||
| U.S. SELLER: CELANESE LTD. (By its General Partner, Celanese International Corporation) |
PARENT: For purposes of Sections 3, 6(c) and 11(p) only, CELANESE CORPORATION |
||||||
| By | /s/ Xxx Xxxxxxxx | By | /s/ Xxxxxx X. Xxxx | ||||
| Name: | Xxx Xxxxxxxx | Name: | Xxxxxx X. Xxxx | ||||
| Title: | Vice President |
Title: | Executive Vice President and General Counsel | ||||
| TICONA POLYMERS INC. |
||||
| By | /s/ Xxx Xxxxxxxx | |||
| Name: | Xxx Xxxxxxxx | |||
| Title: | Attorney-In-Fact | |||
| GERMAN SELLER: CELANESE CHEMICALS EUROPE GMBH |
||||
| By | /s/ Xxx Xxxxxxxx | |||
| Name: | Xxx Xxxxxxxx | |||
| Title: | Attorney-In-Fact | |||
| By | /s/ Xxxxxx X. Xxxx | |||
| Name: | Xxxxxx X. Xxxx | |||
| Title: | Attorney-In-Fact | |||