ASSET PURCHASE AND SALE AGREEMENT
THIS ASSET PURCHASE AND SALE AGREEMENT ("Agreement"), dated as of June
26, 1998 by and between ALLIEDSIGNAL INC., a Delaware corporation ("Seller"),
and KMG-BERNUTH, INC., a Delaware corporation ("Buyer").
Seller is the owner of a business engaged in the marketing and
distribution of creosote (the "Business"). Seller desires to sell and Buyer
desires to purchase the Business on the terms and conditions set forth in this
Agreement. Accordingly, in consideration of the mutual covenants contained
herein and intending to be legally bound, Seller and Buyer agree as follows:
ARTICLE I.
SALE AND PURCHASE OF ASSETS
Concurrently with the execution and delivery hereof, Seller is
selling, transferring, assigning, conveying, setting over and delivering to
Buyer, and Buyer is purchasing and acquiring from Seller, certain assets
associated with the Business, which include certain creosote supply contracts
("Creosote Contracts"), as specifically set forth on Exhibit 1.0 (collectively,
the "Assets"). No other rights, properties or assets, whether or not associated
with the Business are intended to, or shall, be included among the Assets or
conveyed, granted, transferred, contributed, assigned or delivered to the Buyer
hereunder except as set forth in Exhibit 1.0.
ARTICLE II.
CLOSING AND PURCHASE PRICE
2.1 THE CLOSING. The closing (the "Closing") of the transactions
contemplated hereby shall take place at Seller's offices in Morristown, New
Jersey, effective as of June 30, 1998 (the "Closing Date"). Title to the Assets
shall pass to Buyer as of 11:59 p.m. Eastern Daylight time on the Closing Date.
Buyer shall assume risk of loss for the Assets at that time as of the Closing
Date. Time is of the essence in this Agreement, and this Agreement shall
terminate if the closing has not been completed by June 30, 1998.
2.2 CONSIDERATION. In consideration of the sale and transfer of the
Assets to Buyer and the other undertakings of Seller hereunder, Buyer shall:
(a) pay the Purchase Price (as hereinafter defined) to Seller, and (b) assume
the Assumed Liabilities (as hereinafter defined), as of the Closing Date. The
Purchase Price to be paid by Buyer hereunder shall be made by delivery to Seller
of immediately available funds by bank wire transfer to a bank account
designated by Seller.
2.3 PURCHASE PRICE. The Purchase Price shall be the sum of Four
Million Five
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Hundred Thousand Dollars ($4,500,000.00). The Purchase Price shall be paid
in cash by wire transfer in immediately available funds to an account
specified by Seller.
2.4 ALLOCATION OF PURCHASE PRICE. Seller and Buyer mutually agree to
the allocation of the Purchase Price among the Assets as set forth on Schedule
2.4, in accordance with Section 1060 of the Internal Revenue Code of 1986, as
amended (the "Code"). Each of the parties agrees to report this transaction for
all Tax purposes in accordance with such allocation of the Purchase Price,
including, without limitation, for all purposes on any federal or state income
or franchise Tax return filed by any party after the Closing Date.
ARTICLE III.
ASSUMPTION OF LIABILITIES
As of the Closing Date, Buyer will assume and become liable for (i)
all obligations of Seller under the Creosote Contracts; (ii) all railcar leases
set forth on Exhibit 1.0; and (iii) any and all liabilities which arise out of
or relate to the Business or to the Assets as operated or owned after the
Closing Date or arise out of events first occurring or conditions first existing
after the Closing Date (collectively, the "Assumed Liabilities"). All
liabilities except for the Assumed Liabilities which have arisen or arise out of
or relate to the Business, all liabilities which arise out of or relate to the
operation of the Assets, as conducted by Seller, prior to and on the Closing
Date and all liabilities which arise out of or relate to the manufacture and
production of creosote by Seller (collectively, the "Excluded Liabilities"),
shall continue to be liabilities of Seller. Certain of the Excluded Liabilities
are set forth more specifically on Exhibit 3.0.
ARTICLE IV.
REPRESENTATIONS AND WARRANTIES
4.1 REPRESENTATIONS AND WARRANTIES OF SELLER. Except as set forth in
the disclosure schedule attached hereto, Seller hereby represents and warrants
to Buyer as follows:
4.1.1 ORGANIZATION. Seller is a corporation duly organized,
validly existing and in good standing under the laws of the State of Delaware.
Seller is duly qualified to do business as a foreign corporation and is in good
standing in all jurisdictions in which the ownership of the Assets or the
operation of the Business makes such qualification necessary, except to the
extent that the failure to be so qualified has not resulted in, and is not
likely to result in, a material adverse change in the Business.
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4.1.2 AUTHORITY TO CONDUCT BUSINESS AND TO OWN AND SELL ASSETS.
Seller has all necessary power and authority to own the properties, rights and
other assets it purports to own and which are used or useful in the Business and
to carry on the Business as it is now being conducted, and has the right, power
and authority to transfer the Assets in accordance with the terms and conditions
hereof.
4.1.3 NO CONSENTS. No governmental consents, approvals, orders or
authorizations, and no consent or approval of any other third party, are
required for the execution and delivery of this Agreement by Seller, or for the
consummation by Seller of the transactions contemplated hereby.
4.1.4 AUTHORITY TO EXECUTE, DELIVER AND PERFORM THIS AGREEMENT.
Seller has all necessary corporate power and authority to execute, deliver and
perform this Agreement. All proceedings and actions by Seller required to
authorize the legal and valid execution, delivery and performance of this
Agreement and the consummation of all of the transactions contemplated by this
Agreement, have been, or will be on or before the Closing Date, duly and validly
completed. This Agreement has been duly and validly authorized, executed and
delivered by, and is the valid and binding obligation of, Seller.
4.1.5 NO VIOLATION OF LAWS, AGREEMENTS; NO LIENS. The execution
and delivery of this Agreement by Seller and the consummation by Seller of the
transactions contemplated hereby (i) are not prohibited by, and do not violate
any provision and will not result in the breach of, or accelerate or permit the
acceleration of the performance required by the terms of (A) any applicable law,
rule, regulation, judgment, decree, order or other requirement of (x) the United
States or of (y) any State of the United States or of (z) any court, authority,
department, commission, board, bureau, agency or instrumentality of either (x)
or (y), (B) the Articles of Incorporation or By-Laws of Seller, and any
amendments to any of them, or (C) any material contract, indenture, agreement or
commitment to which Seller is a party or is bound or to which any of the Assets
are subject or which is material to the Business, and (ii) have not resulted and
will not result in the creation or imposition of any material lien,
encroachment, easement, encumbrance, mortgage, hypothecation, equity, charge,
restriction, possibility of reversion or other similar conflicting ownership or
security interest on any Asset.
4.1.6 BUSINESS IN THE ORDINARY COURSE. Since January 1, 1998,
Seller has conducted the Business in the ordinary course of business as
heretofore conducted and has not entered into any contracts or transactions with
respect to the Business other than in the ordinary course of business.
4.1.7 FINANCIAL STATEMENTS. Exhibit 4.1.7 sets forth the
statement of operations of the Business for the periods ended December 31, 1997
and March 31, 1998 (the "Operating Statements"). The Operating Statements have
been prepared from the books and records of the Business using the accounting
principles set forth in the notes to the Operating Statements. Except as
disclosed in those notes, the Operating Statements reflect in all material
respects the
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results of operations of the Business for the respective periods. Seller
makes no representation or warranty that the results of operations reflected
in the Operating Statements included in Exhibit 4.1.7 may be attained or
exceeded in any future period by any business or enterprise which Buyer may
conduct using the Assets.
4.1.8 NO UNDISCLOSED LIABILITIES. There are no liabilities of
Seller materially affecting the Business and the Assets (other than Excluded
Liabilities) except as shown in the Operating Statements and the notes thereto
and those arising in the ordinary course of business.
4.1.9 NO LITIGATION. There is no legal action or investigation or
inquiry currently pending or, to the knowledge of the officers of Seller,
threatened in writing against Seller (before any court, agency, arbitrator or
otherwise) with respect to the Business or any of the Assets. Seller is not
subject to any judgment, decree or order entered in any lawsuit or proceeding
brought against it that may reasonably be expected to adversely affect the
Assets in any material respect. It is understood and agreed that any such
action or proceeding arising from events prior to Closing, or any liability
resulting therefrom, will constitute an Excluded Liability.
4.1.10 CUSTOMER LISTS. Exhibit 1.0 hereto includes the top ten
customers of Seller with respect to the Business during the twelve-month period
ended December 31, 1997 and the four-month period ended April 30, 1998.
4.1.11 COMPLIANCE WITH LAW. Seller has complied in all material
respects with each, and is not in material violation of any law, ordinance, or
governmental rule or regulation to which the Business or any of the Assets is
subject.
4.1.12 TITLE TO ASSETS. Seller has as of the date hereof, and on
the Closing Date will have and convey to Buyer, except as shown on Exhibit
4.1.12 hereto, good and marketable title to all the Assets, free and clear of
any mortgage, security interest, pledge, lien, or encumbrance, other than those
which do not adversely affect the value or use in the Business of any Asset or
interfere with the conduct of the Business as now conducted.
4.1.13 BROKERS AND FINDERS. Seller has taken no action that,
directly or indirectly, would obligate Buyer to anyone acting as broker, finder,
financial advisor or in any similar capacity in connection with this Agreement
or any of the transactions contemplated hereby.
4.1.14 TENANCIES; THIRD PARTY RIGHTS. Seller has granted no
leases or tenancies for any portion of the Assets, and no third party has any
rights to the purchase, use or possession of any part or all of the Assets.
4.1.15 LIMITATIONS. EXCEPT FOR THE REPRESENTATIONS AND WARRANTIES
OF SELLER EXPRESSLY SET FORTH IN THIS AGREEMENT, THE SALE OF THE ASSETS IS MADE
"AS IS, WHERE IS," AND THE SELLER SHALL
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NOT BE DEEMED TO HAVE MADE ANY FURTHER REPRESENTATIONS OR WARRANTIES, EXPRESS
OR IMPLIED, NOW OR HEREAFTER, AS TO THE VALUE, ECONOMIC VIABILITY OR
PROFITABILITY OF ANY ENTERPRISE BUYER MAY CONDUCT USING THE ASSETS ACQUIRED
HEREUNDER, CONDITION, DESIGN, OPERATION, MERCHANTABILITY, QUALITY OR
WORKMANSHIP, FITNESS FOR USE OR A PARTICULAR PURPOSE, MAINTENANCE OR
MARKETABILITY OF ANY OF THE ASSETS. NO REFERENCE TO "BUSINESS" IN THIS
AGREEMENT SHALL BE READ TO IMPLY ANY SUCH REPRESENTATION OR WARRANTY AND ANY
REFERENCE TO "BUSINESS" HEREIN REFERS ONLY TO THE ENTERPRISE CONDUCTED BY
SELLER PRIOR TO THE DATE HEREOF AND SHALL NOT BE INTERPRETED OTHERWISE.
4.2 REPRESENTATIONS AND WARRANTIES OF BUYER. Buyer hereby represents
and warrants to Seller as follows:
4.2.1 ORGANIZATION OF BUYER. Buyer is a corporation duly
organized, validly existing and in good standing under the laws of Delaware with
all requisite power and authority to own or hold the Assets it will acquire
pursuant to the transactions contemplated by this Agreement, and to execute,
deliver and perform this Agreement and other documents to be executed by Buyer
in connection with this transaction.
4.2.2 AUTHORITY TO EXECUTE, DELIVER AND PERFORM THIS AGREEMENT.
Buyer has all necessary corporate power and authority to execute, deliver and
perform this Agreement. All proceedings and action by Buyer required to
authorize the legal and valid execution, delivery and performance of this
Agreement and other documents related to this transaction and its consummation
have been, or will be on or before the Closing Date, duly taken by Buyer. This
Agreement has been duly authorized, executed and delivered by, and is the valid
and binding obligation of, Buyer.
4.2.3 NO VIOLATION OF LAWS, AGREEMENTS. The execution and
delivery of this Agreement by Buyer and the consummation by Buyer of the
transactions contemplated hereby are not prohibited by, and do not violate any
provision and will not result in the breach of, or accelerate or permit the
acceleration of the performance required by the terms of, (A) any applicable
law, rule, regulation, judgment, decree, order or other requirement of (x) the
United States or of (y) any State of the United States, or of (z) any court,
authority, department, commission, board, bureau, agency or instrumentality of
(x) or (y), (B) the Charter and By-Laws of Buyer or (C) any material contract,
indenture, agreement or commitment to which Buyer is a party or bound or to
which any of Buyer's properties are subject.
4.2.4 KNOWLEDGE CONCERNING REPRESENTATIONS BY SELLER. Neither
Buyer nor any of its representatives has knowledge of any breach by Seller or
the failure to be true and correct of any of the representations or warranties
set forth in Section 4.1 of this Agreement.
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4.2.5 BUYER'S FULL ACCESS. Buyer acknowledges that it has been
permitted full and complete access to the Assets and the Business that it has
desired or requested to see and/or review, and that Buyer and its
representatives have had a full opportunity to meet with the representatives of
Seller to discuss the Assets and the employees of the Business to inspect the
Assets. Buyer further acknowledges that neither Seller nor any other person has
made any representation or warranty, express or implied, as to the accuracy or
completeness of any information regarding the Assets not included in this
Agreement, and Seller will not have or be subject to any liability to Buyer or
any person resulting from the distribution to Buyer, or Buyer's use of, any such
information.
4.2.6 BROKERS AND FINDERS. Buyer has taken no action that,
directly or indirectly, would obligate Seller to anyone acting as a broker,
finder, financial advisor or in any similar capacity in connection with this
Agreement or any of the transactions contemplated hereby.
4.2.7. BUYER AS SOPHISTICATED USER. Buyer is a sophisticated user,
marketer, and distributor of creosote and is familiar with all requirements and
practices (including, without limitation, health, safety, and environmental)
necessary for the legal and safe carrying-on of the Business or other
disposition of the Assets from and after the Closing.
ARTICLE V.
CONDITIONS TO CLOSING
5.1 BUYER'S CONDITIONS. The obligations of Buyer to consummate the
transactions contemplated hereby at the Closing are subject to the satisfaction
(unless waived) of the following conditions:
(a) Seller shall execute and deliver to Buyer a general
assignment and xxxx of sale and such other good and sufficient instruments of
transfer conveying and transferring to Buyer all of the Assets (the "Transfer
Documents"), in each case in form satisfactory to Buyer.
(b) Seller and Buyer shall execute an agreement concerning the
sale of creosote from Seller to Buyer, in the form attached hereto as Exhibit
5.1(b).
(c) Buyer shall receive the opinion of Xxxxx X. Xxxxx, Esq.
counsel for Seller in the form attached hereto as Exhibit C.
(d) Each of the representations and warranties of Seller set
forth in Section 4.1 of this Agreement shall be true and correct in all material
respects both on the date of this Agreement and on the Closing Date as though
made on and as of each such date (except with respect to the effect of
transactions permitted by the provisions of this Agreement), except as to
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any matter waived by Buyer, and Seller shall deliver to Buyer at the Closing
a certificate dated as of the Closing Date and executed by any authorized
officer to that effect.
(e) There shall have been no material adverse change in the
Assets or the Business.
(f) Seller shall have complied with all of the covenants and
agreements herein contained to be performed by it at or prior to the time fixed
for the Closing, and Seller shall deliver to Buyer at the Closing a certificate
dated as of the Closing Date and executed by any authorized officer to that
effect.
(g) All requisite approvals, authorizations and orders of all
governmental authorities pertaining to consummation of the transactions
contemplated hereby shall have been obtained, except to the extent that failure
to obtain such consent shall not have a material adverse effect on the Assets.
(h) There shall be no suit, action or other proceeding pending or
threatened before any court or before or by any governmental agency in which it
is sought to restrain, prohibit, invalidate or set aside in whole or in part the
consummation of this Agreement or the transactions contemplated hereby or to
obtain damages in connection therewith.
5.2 SELLER'S CONDITIONS. The obligation of Seller to consummate the
transactions contemplated hereby at the Closing are subject to the satisfaction
(unless waived) of the following conditions:
(a) Seller and Buyer shall execute an agreement concerning the
sale of creosote from Seller to Buyer, in the form attached hereto as Exhibit
5.1(b) (the "Supply Agreement").
(b) Buyer shall execute and deliver to Seller an assumption
agreement pursuant to which Buyer shall assume the Assumed Liabilities in a form
satisfactory to Seller.
(c) Seller shall receive the opinion of Xxxxx & Xxxxxxx, L.L.P.
counsel for Buyer in the form attached hereto as Exhibit C.
(d) Buyer shall pay to Seller at the Closing the Purchase Price.
(e) Seller shall receive from KMG Chemicals, Inc., in the form
attached hereto as Exhibit 5.2(e), an irrevocable guaranty of all obligations of
Buyer under this Agreement and all ancillary agreements, including but not
limited to Buyer's obligations under the agreement set forth as Exhibit 5.1(b)
and Buyer's obligations under Article VI of this Agreement.
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(f) Each of the representations and warranties of Buyer set
forth in Section 4.2 of this Agreement shall be true and correct in all material
respects both on the date of this Agreement and on the Closing Date as though
made on and as of each such date (except with respect to the effect of
transactions permitted by the provisions of this Agreement), except as to any
matter waived by Seller, and Buyer shall deliver to Seller at the Closing a
certificate dated the Closing Date and executed by any authorized officer to
that effect.
(g) Buyer shall have complied with all of the covenants and
agreements herein contained to be performed by it at or prior to the time fixed
for the Closing, and Buyer shall deliver to Seller at the Closing a certificate
dated as of the Closing Date and executed by any authorized officer to that
effect.
(h) All requisite approvals, authorizations and orders of all
governmental authorities pertaining to consummation of the transactions
contemplated hereby shall have been obtained.
(i) There shall be no suit, action or other proceeding pending
or threatened before any court or before or by any governmental agency in which
it is sought to restrain, prohibit, invalidate or set aside in whole or in part
the consummation of this Agreement or the transactions contemplated hereby or to
obtain damages in connection therewith.
5.3 FAILURE OF A CONDITION. The parties shall use good faith efforts
to bring about the satisfaction of the conditions hereunder prior to and at
Closing. Notwithstanding anything to the contrary set forth herein, this
Agreement may be terminated and the transactions contemplated hereby abandoned
at any time prior to Closing: (a) by mutual written consent of Buyer and
Seller; or (b) by Buyer or Seller, upon written notice to the other, if such
other party (or its affiliate) has breached any material representation,
warranty or covenant contained in this Agreement in any material respect, if the
non-breaching party has notified the breaching party of the breach in writing
and the breach has continued without cure for a period of thirty (30) days after
notice of breach (during which time the breaching party shall use its reasonable
efforts to remedy such breach). If this Agreement is terminated pursuant to
this Section, neither party shall have any rights or obligations to the other
hereunder or otherwise.
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ARTICLE VI.
INDEMNIFICATION
6.1 INDEMNIFICATION BY SELLER. Seller shall indemnify, defend, save
and hold Buyer harmless from and against all Adverse Consequences (as defined
below) incurred by Buyer in connection with (i) any breach of the
representations and warranties made by Seller in this Agreement, (ii) any breach
of any of the covenants or agreements made by Seller in this Agreement, or (iii)
the Excluded Liabilities. Notwithstanding the foregoing, Buyer shall have no
right to indemnification with respect to any claim which may arise under the
Supply Agreement set forth as Exhibit 5.1(b) hereto, and Buyer's rights and
remedies for any such claims shall be governed by the terms and conditions of
the Supply Agreement.
6.2 INDEMNIFICATION BY BUYER. Buyer shall indemnify, defend, save
and hold Seller harmless from and against any and all demands, claims or actions
incurred by Seller in connection with (i) any breach of the representations and
warranties made by Buyer in this Agreement, (ii) any breach of any of the
covenants or agreements made by Buyer in this Agreement, (iii) any Assumed
Liabilities, or (iv) the operation of any of the Assets after the Closing Date.
Notwithstanding the foregoing, Seller shall have no right to indemnification
with respect to any claim which may arise under the Supply Agreement set forth
as Exhibit 5.1(b) hereto, and Seller's rights and remedies for any such claims
shall be governed by the terms and conditions of the Supply Agreement.
6.3 NOTICE OF CLAIMS. If Buyer or Seller, as the case may be, (an
"Indemnified Party") believes that it has suffered or incurred any Adverse
Consequences for which it is entitled to indemnification under this Article VII,
such Indemnified Party shall promptly notify the party or parties from whom
indemnification is being claimed (the "Indemnifying Parties") identifying with
particularity the basis of such claim. If any action at law or suit in equity
is instituted by or against a third party with respect to which any Indemnified
Party intends to claim any Adverse Consequences, such Indemnified Party shall
promptly notify the Indemnifying Parties of such action or suit, provided,
however, that no undue delay on the part of the Indemnified party in notifying
the Indemnifying party shall relieve the Indemnifying Party from any obligation
hereunder unless (and then solely to the extent) the Indemnifying Party is
prejudiced thereby. If an Indemnified Party makes a claim for indemnification
within the applicable survival period as set forth in Section 6.5, then the
obligations of the Indemnifying Party with respect to Adverse Consequences under
Sections 6.1 or 6.2 shall continue through and after the date of the claim for
indemnification (including any Adverse Consequences suffered after the end of
the applicable survival period.)
6.4 THIRD PARTY CLAIMS; LIMITATION. So long as (i) the Indemnifying
Party notifies the Indemnified Party in writing within fifteen (15) days after
the Indemnified Party has given notice of such third party claim that
Indemnifying Party will indemnify the Indemnified Party from and against the
entirety of any Adverse Consequences the Indemnified Party may suffer resulting
from, arising out of, relating to or in the nature of or caused by the third
party claim, (ii) the third
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party claim involves only money damages and does not seek an injunction or
other equitable relief as a primary form of relief, (iii) the Indemnifying
Party conducts the defense of the third party claim actively and diligently,
then the Indemnifying Party shall have the right to conduct and control,
through counsel of its choosing, any third party claim, action or suit So
long as the Indemnifying Party is conducting the defense of a third party
claim in accordance with this Section 6.4, (i) the Indemnified Party may
retain separate co-counsel at its sole cost and expense and participate in
the defense of the third party claim, (ii) the Indemnified Party will not
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 unreasonably withheld), and (iii) the
Indemnifying Party will not 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 unreasonably withheld).
In the event any of the conditions to the Indemnifying Party conducting the
defense of the third party claim is or becomes unsatisfied, however, (i) the
Indemnified Party may defend against, and consent to the entry of any
judgment or enter into any settlement with respect to, the third party claim
in any manner it reasonably may deem appropriate (and the Indemnified Party
need not consult with, or obtain any consent from, the Indemnifying Party in
connection therewith), (ii) the Indemnifying Party will reimburse the
Indemnified Party promptly and periodically for the cost of defending against
the third party claim (including reasonable attorneys fees and expenses), and
(iii) the Indemnifying Party will remain responsible for any Adverse
Consequences the Indemnified Party may suffer resulting from, arising out of,
relating to or in the nature of, or caused by the third party claim to the
fullest extent provided in this Article VI. No Indemnifying Party shall be
liable for any indemnity for any damages unless the aggregate amount of such
damages exceeds $50,000.00, and then such Indemnifying Party shall be liable
for indemnity only to the extent of such excess. In no case, however, shall
such Indemnifying Party be liable for damages which exceed, in the aggregate,
fifty percent (50%) of the Purchase Price.
6.5 SURVIVAL PERIOD. The representations and warranties set forth
herein shall survive for a period of one year from the Closing Date. The
liability of Seller for Excluded Liabilities and the liability of Buyer for
Assumed Liabilities shall survive the Closing Date and continue in full force
and effect forever thereafter (subject to any applicable statute of
limitations).
6.6 EXCLUSIVE REMEDY. The indemnification provided in this Article
VI shall be the exclusive post-Closing remedy available to any party hereto for
any breach or inaccuracy of any representation, warranty or covenant contained
herein, except that either party may obtain such equitable remedies as may be
available under applicable law for the breach of the post-Closing covenants set
forth in Article VIII.
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6.7 MINIMIZING LOSSES. Each party agrees to use all reasonable
efforts to minimize all Adverse Consequences for which it may seek
indemnification from the other party pursuant to this Article VI, and to
minimize the amount of such indemnification obligation by reasonably pursuing
the maximum possible insurance recovery or recovery from other available sources
with respect to Adverse Consequences.
6.8 ADVERSE CONSEQUENCES. For purposes of this Agreement, the term
"Adverse Consequences" means all actions, suits, proceedings, hearing,
investigations, charges, complaints, claims, demands, injunctions, judgments,
orders, decrees, rulings, damages, dues, penalties, fines, costs, amounts paid
in settlement (subject, however, to Section 6.4 hereof), liability, obligation,
taxes, liens, losses, expenses and fees, including court costs and reasonable
attorneys fees and expenses.
ARTICLE VII.
TAXES AND EXPENSES
7.1 PRE-CLOSING TAXES. Seller shall be responsible for and shall pay
any and all Taxes arising or resulting from the conduct of the Business or the
ownership of the Assets on or prior to the Closing Date (including, without
limitation, the sale of the Business and the Assets on the Closing Date pursuant
to this Agreement), which liability shall be an Excluded Liability.
7.2 POST-CLOSING TAXES. Buyer shall be responsible for and shall pay
any and all Taxes arising or resulting from the conduct of the Business or the
ownership of the Assets after the Closing Date (excluding, without limitation,
the sale of the Business and the Assets on the Closing Date pursuant to this
Agreement), which liability shall be an Assumed Liability.
7.3 DEFINITION OF "TAX." "Tax" means any tax imposed under Subtitle A
of the Code and any net income, alternative or add-on minimum tax, gross income,
gross receipts, sales, use, ad valorem, transfer, franchise, profits, license,
lease, service, service use, withholding on amounts paid to or by Seller,
payroll, employment, excise, severance, stamp, capital stock, occupation,
property, environmental or windfall profit tax, premium, custom, duty or other
tax, governmental fee or other like assessment or charge of any kind whatsoever,
together with any interest, penalty, addition to tax or additional amount
imposed by any governmental authority responsible for the imposition of any such
tax.
7.4 TRANSFER TAXES. Buyer shall pay all sales, use, registration and
any other similar transfer taxes, and all interest, penalties, or additions to
such taxes, assessed or payable in connection with the transfer of the Assets by
Seller to Buyer.
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7.5 EXPENSES. Except as otherwise provided in this Article VII, each
party shall bear and pay its own expenses and taxes incurred in connection with
the transactions referred to in this Agreement.
ARTICLE VIII.
MISCELLANEOUS
8.1 FURTHER Assurances. After the Closing, Seller shall from time to
time, at Buyer's request, execute and deliver to Buyer, such other instruments
of conveyance and transfer (including without limitation, additional assignments
suitable for recording and any actions necessary to effect the transfer of any
registrations under the Federal Insecticide, Fungicide, and Rodenticide Act) and
take such other action as Buyer may reasonably request to the extent necessary
to more effectively sell, transfer, assign and deliver and vest in Buyer, title
to and possession of the Assets as provided in this Agreement or otherwise
necessary to consummate the transactions contemplated by this Agreement.
8.2 ACCESS TO BOOKS AND RECORDS. After Closing:(i) Buyer shall
provide Seller with reasonable access, upon reasonable notice, to all books and
records comprising the Business or the Assets transferred hereunder, in the
event that Seller shall become involved in any effort, undertaking, litigation,
or other matter which would have required such access had the Closing not taken
place; and (ii) Seller shall provide Buyer with reasonable access, upon
reasonable notice, to all books and records to the extent related to the
Business or the Assets transferred hereunder to assist Buyer in making any
submission or any filing required under applicable securities or other law
(including the Federal Insecticide, Fungicide and Rodenticide Act). The parties
shall retain such books and records for a period of no less than five (5) years.
8.3 CONFIDENTIALITY. After Closing: (i) Seller shall maintain the
confidentiality of, and shall not use, for the benefit of itself or others, any
confidential information concerning the Business or the Assets, including but
not limited to any customer lists, pricing information or other business
information; and (ii) Buyer shall not use any confidential information obtained
from Seller relating to periods prior to the Closing Date, except for its own
legitimate business purposes. PROVIDED, HOWEVER, that this Section 8.3 shall
not restrict (a) any disclosure by either party of any confidential information
required by applicable law, securities exchange or any court of competent
jurisdiction; PROVIDED, that the other party is given notice and an adequate
opportunity to contest such disclosure, (b) any disclosure on a confidential
basis to any such party's attorneys, accountants, lenders and investment bankers
and (c) any disclosure of information (i) which is available publicly as of the
date of this Agreement, (ii) which, after the date of this Agreement, becomes
available publicly through no fault of the disclosing party or any of its
Affiliates or (iii) which is received by such party from a third party not, to
the best of such party's knowledge, subject to any obligation of confidentiality
with respect thereto.
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8.5 NON-SOLICITATION. Buyer agrees that it will not, for a period of
two (2) years from the date hereof, solicit the employment or other services of
any person who is an active employee of Seller.
8.6 NOTICES. All notices, requests, consents and other
communications hereunder shall be in writing and shall be deemed to have been
duly given when personally delivered or upon expiration of three (3) days after
being mailed by registered or certified first class mail, return receipt
requested, postage prepaid, and in each case addressed:
If to Seller, to:
AlliedSignal Inc.
P. O. Xxx 0000
000 Xxxxxxxx Xx.
Xxxxxxxxxx, XX 00000
Attention: General Manager, Carbon Materials & Technologies
with a copy to:
Xxxxx X. Xxxxx, Esq.
Assistant General Counsel
AlliedSignal Inc.
X.X. Xxx 0000
000 Xxxxxxxx Xx.
Xxxxxxxxxx, XX 00000
If to Buyer, to:
KMG-Bernuth, Inc.
00000 Xxxxxx Xxxxx 000
Xxxxxxx, XX 00000
Attention: President
with a copy to:
Xxxxx & Xxxxxxx, L.L.P.
Suite 1111
0000 Xxxxx Xxxxx
Xxxxxxx, XX 00000
provided, however, that if either addressee shall have designated a different
address by such notice to the other addressee, then to the last address so
designated.
8.7 ASSIGNMENT. This Agreement and the rights and duties hereunder
shall be binding upon and inure to the benefit of the successors and assigns of
each of the parties hereto.
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8.8 WAIVERS. Any waiver by Seller or Buyer of any breach of or
failure to comply with any provision of this Agreement by the other party must
be in writing and shall not be construed as, or constitute, a continuing waiver
of such provision, or a waiver of such provision, or a waiver of any other
breach of, or failure to comply with, any other provision of this Agreement.
8.9 COMPLETE AGREEMENT. Except as set forth in any contemporaneous
written instruments signed by each of the parties hereto, this Agreement and the
Exhibits and ancillary documents hereto set forth the entire understanding of
the parties hereto and supersede all prior agreements, covenants, arrangements,
communications, representations or warranties, whether oral or written, by any
officer, employee or representative of any party.
8.10 GOVERNING LAW. This Agreement shall be construed and enforced
in accordance with and governed by the laws of the State of New York without
giving effect to the principles of conflicts of laws thereof.
8.11 THIRD PARTIES; AMENDMENT AND TERMINATION. Nothing herein
expressed or implied is intended or shall be construed to confer upon or give to
any person or entity, other than the parties hereto, any rights or remedies
under or by reason of this Agreement. This Agreement may not be amended or
terminated orally but only by an instrument in writing duly executed by the
parties hereto.
8.12 NO WAIVER. Failure to exercise any power given any party
hereunder or to insist upon strict compliance by any other party shall not
constitute a waiver of any party's right to demand exact compliance with the
terms hereof.
8.13 SEPARABILITY OF PROVISIONS. Each provision of this Agreement
shall be considered separable and if for any reason any provision which is not
essential to the effectuation of the basic purpose of this Agreement is
determined to be invalid or contrary to any existing or future law, such
invalidity shall not impair the operation of or affect those provisions of this
Agreement which are valid.
8.14 HEADINGS. The headings of the Articles and Sections of this
Agreement and of the Appendices to this Agreement are inserted for convenience
of reference only and shall not be deemed to constitute a part hereof.
8.15 COUNTERPARTS. More than one counterpart of this Agreement may be
executed by the parties hereto, and each executed counterpart shall be deemed an
original.
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8.16 PUBLICITY. Any public announcements or other publicity with
respect hereto or the transactions contemplated hereby shall be made only at
such time and in such manner Seller and Buyer shall mutually agree, except that
either party shall be free to make such public announcements as it shall deem
reasonably necessary, after full consultation with the other, to comply with
federal or state securities or other applicable laws.
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WITNESS the due execution hereof on the day and year first above
written.
ALLIEDSIGNAL INC.
By: /s/ XXXXXXX X. XXXXX
----------------------------
Name: Xxxxxxx X. Xxxxx
--------------------------
Title: General Manager
-------------------------
KMG-BERNUTH, INC.
By: /s/ Xxxxx X. Xxxxxxx
----------------------------
Name: Xxxxx X. Xxxxxxx
--------------------------
Title: President
-------------------------
16
Asset Purchase and Sale Agreement
Exhibit 1.0
ASSETS BEING SOLD BY SELLER TO BUYER
1. Federal Insecticide, Fungicide, and Rodenticide Act Registrations for
Creosote
See Exhibit 1.0 Attachments 1 through 15
2. All of Seller's interests in the Creosote Council II as more specifically
set forth in a certain Memorandum of Understanding which created Creosote
Council II
3. Current Customer List
See Exhibit 1.0 Attachment 16
4. Creosote Supply Contract with Xxxx-XxXxx Chemical Corporation for period of
January 1, 1998 - December 31, 1998
See Exhibit 1.0 Attachment 17
5. Railcar Leases
The associated railcar leases are not freely assignable; however,
Seller will make arrangements to either assign the leases or make other
arrangements acceptable to Buyer.
See Exhibit 1.0 Attachments 18 through 19 for copies of Seller's
current railcar leases with General Electric Railcar Services
Corporation and General American Transportation Corporation
EXHIBIT 2.4
ALLOCATION OF PURCHASE PRICE
All assets conveyed hereunder: $4,500,000.00
Asset Purchase and Sale Agreement
Exhibit 3.0
CERTAIN EXCLUDED LIABILITIES
All liabilities, other than the Assumed Liabilities, which have arisen or
arise out of, or relate to, the Business, and all liabilities which arise
out of, or relate to, the operation of the Assets, as conducted by Seller
prior to closing, including, but not limited to:
Accounts Payable and Accrued Liabilities
Income, Payroll and Sales & Use Tax obligations
Employee Pension, Post Employment, and Post Retirement Obligations
Environmental Liabilities regarding the manufacturing business
Any or all liabilities relating to a certain past non-product related
customer dispute which has been settled under terms of confidentiality
Asset Purchase and Sale Agreement
Exhibit 4.1.7
STATEMENT OF OPERATIONS FOR THE CREOSOTE BUSINESS
See Exhibit 4.1.7 Attachments 1 and 2
Asset Purchase and Sale Agreement
Exhibit 4.1.12
EXCLUDED ASSETS
The railcar leases are not freely assignable; however, Seller will make
arrangements to either assign the leases or make other arrangements
acceptable to Buyer.
Asset Purchase and Sale Agreement
Exhibit 5.1(b)
AGREEMENT REGARDING THE SALE OF CREOSOTE FROM SELLER TO BUYER
See Creosote Supply Agreement, an ancillary agreement to the Asset Purchase
and Sale Agreement
Asset Purchase and Sale Agreement
Exhibit C
Opinion of Xxxxx X. Xxxxx, Counsel for Seller
Opinion of Xxxxx X. Xxxxxxx, Xxxxx & Xxxxxxx, L.L.P., Counsel for Buyer
Asset Purchase and Sale Agreement
Exhibit 5.2(e)
IRREVOCABLE GUARANTY OF ALL OBLIGATIONS OF BUYER UNDER THIS AGREEMENT AND
ALL ANCILLARY AGREEMENTS
