Exhibit 10(q)
CONFIDENTIAL
MASTER TRANSACTION AGREEMENT
between
HATCH ASSOCIATES, INC.
and
XXXXXX GROUP INTERNATIONAL, INC.
Dated as of
July 6, 2000
TABLE OF CONTENTS
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ARTICLE 1 DEFINITIONS..................................................... 1
1.1 Definitions............................................ 1
ARTICLE 2 SALE AND PURCHASE OF THE ASSETS................................. 2
2.1 Transferred Assets..................................... 2
2.2 Excluded Assets........................................ 3
2.3 Assumption of Liabilities.............................. 5
2.4 Excluded Liabilities................................... 6
ARTICLE 3 THE CLOSING..................................................... 7
3.1 Place and Date......................................... 7
3.2 Purchase Price......................................... 7
3.3 Deposit................................................ 7
3.4 Allocation of Purchase Price........................... 7
3.5 Deliveries............................................. 8
3.6 Closing Financial Statements........................... 9
3.7 Consents of Third Parties.............................. 9
3.8 Closing Date Adjustment................................ 9
ARTICLE 4 REPRESENTATIONS AND WARRANTIES OF KAISER........................ 10
4.1 Organization, Standing, Etc. of Sellers................ 10
4.2 Corporate Authorization; Enforceability................ 10
4.3 Charters and Bylaws; Capitalization of Transferred
Subsidiaries........................................... 11
4.4 Governmental Authorizations and Consents............... 11
4.5 Financial Statements................................... 11
4.6 Absence of Certain Changes or Events................... 12
4.7 Title to Transferred Assets............................ 12
4.8 Transferred Intellectual Property...................... 12
4.9 Assumed Contracts...................................... 13
4.10 Litigation............................................. 14
4.11 Licenses and Permits................................... 14
4.12 Environmental Compliance............................... 14
4.13 Absence of Certain Business Practices.................. 15
4.14 Personnel Matters...................................... 15
4.15 Labor Matters.......................................... 16
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4.16 Seller Benefit Plans................................. 16
4.16.1 United States........................................ 16
4.16.2 Non-U.S. Employee Benefit Plans...................... 18
4.17 Insurance............................................ 19
4.18 Powers of Attorney................................... 19
4.19 Brokers.............................................. 19
4.20 Taxes................................................ 20
4.21 Accounts Receivable.................................. 20
4.22 Adequacy of Assets................................... 20
ARTICLE 5 REPRESENTATIONS AND WARRANTIES OF BUYER......................... 20
5.1 Organization and Standing of Buyer................... 21
5.2 Authorization........................................ 21
5.3 Enforceability....................................... 21
5.4 Compliance with Other Instruments and Laws........... 21
5.5 Governmental Authorizations and Consents............. 21
5.6 Litigation........................................... 21
5.7 Access............................................... 22
5.8 Financial Capacity................................... 22
5.9 Brokers.............................................. 22
5.10 Buyer Awareness...................................... 22
ARTICLE 6 COVENANTS RELATING TO PERSONNEL ARRANGEMENTS.................... 22
6.1 Transferee Employees................................. 22
6.2 Severance Obligations................................ 23
6.3 COBRA Obligations.................................... 23
6.4 Plans, Benefits and Policies......................... 23
6.5 Foreign Employees.................................... 25
6.6 Bonuses.............................................. 25
ARTICLE 7 COVENANTS OF SELLERS............................................ 25
7.1 Conduct of Business.................................. 25
7.2 Use of Business Names by Buyer....................... 27
7.3 Access............................................... 28
7.4 Acquisition Proposals................................ 28
ARTICLE 8 COVENANTS OF BUYER.............................................. 28
8.1 Investigation........................................ 28
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8.2 Intentionally Omitted................................ 28
8.3 Buyer Cooperation.................................... 28
ARTICLE 9 COVENANTS OF BOTH PARTIES....................................... 30
9.1 Commercially Reasonable Efforts...................... 30
9.2 Other Filings........................................ 30
9.3 Public Announcements................................. 30
9.4 Consents; Cooperation................................ 30
9.5 Communications with Customers and Suppliers.......... 31
9.6 Liability for Transfer Taxes......................... 31
9.7 Books and Records.................................... 32
9.8 Tax Matters.......................................... 32
9.8.1 Tax Returns.......................................... 32
9.8.2 Tax Liability........................................ 33
9.8.3 Cooperation.......................................... 33
9.9 Tax Elections........................................ 34
9.10 Confidentiality...................................... 34
9.11 Ancillary Agreements................................. 35
9.12 Assistance........................................... 35
9.13 Notice............................................... 35
ARTICLE 10 BUYER PROTECTIONS: OVERBIDDING PROCEDURES AND
BREAK-UP FEES........................................ 35
10.1 Bankruptcy Court Approvals........................... 35
10.2 Obtaining the Orders................................. 36
10.3 Overbidding Procedures and Break-Up Fee.............. 36
ARTICLE 11 CONDITIONS TO OBLIGATIONS OF BUYER TO CLOSE.................... 37
11.1 Accuracy of Representations and Warranties........... 38
11.2 Performance.......................................... 38
11.3 No Conflict.......................................... 38
11.4 Certificate.......................................... 38
11.5 Bankruptcy Court Approval............................ 38
11.6 Intentionally Omitted................................ 38
11.7 Consents............................................. 38
11.8 Transfer Documents................................... 39
11.9 Transaction Documents................................ 39
11.10 Resignations......................................... 39
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11.11 Corporate Records.................................... 39
11.12 Further Instruments.................................. 39
ARTICLE 12 CONDITIONS TO OBLIGATIONS OF KAISER TO CLOSE................... 39
12.1 Accuracy of Representations and Warranties........... 40
12.2 Performance.......................................... 40
12.3 No Conflict.......................................... 40
12.4 Certificate.......................................... 40
12.5 Bankruptcy Court Approval............................ 40
12.6 Intentionally Omitted................................ 40
12.7 Consents............................................. 40
12.8 Assumption Agreement................................. 41
12.9 Transaction Documents................................ 41
12.10 Further Instruments.................................. 41
12.11 Payment.............................................. 41
ARTICLE 13 TERMINATION.................................................... 41
13.1 Right to Terminate Agreement......................... 41
13.2 Effect of Termination................................ 42
13.3 Buyer's Remedies..................................... 42
13.4 Sellers' Remedies.................................... 42
13.5 Deposit Interest..................................... 42
ARTICLE 14 MISCELLANEOUS.................................................. 42
14.1 Expiration of Representations, Warranties............ 42
and Covenants........................................ 43
14.2 Material Adverse Effect.............................. 43
14.3 Disclaimer of Projections, Etc....................... 43
ARTICLE 15 AGREEMENT CONVENTIONS.......................................... 43
15.1 Further Assurances................................... 43
15.2 Notices.............................................. 44
15.3 Assignment........................................... 45
15.4 Entire Agreement; Amendment; Governing Law; Etc...... 45
15.5 Consent to Jurisdiction.............................. 46
15.6 Severability......................................... 46
15.7 Reliance on Counsel and Other Advisors............... 46
15.8 Exhibits and Schedules............................... 46
15.9 Rules of Construction................................ 46
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15.10 Counterparts......................................... 47
15.11 No Third Party Rights................................ 47
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SCHEDULES
Schedule Subject Matter
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2.1(a) Owned Fixed Assets
2.1(b) Accounts Receivable
2.1(c) Transferred Intellectual Property
2.1(e) Assumed Contracts
2.1(f) Inventory
2.1(m) Transferred Insurance
2.2(a) Excluded Intellectual Property
2.2(h) Excluded Litigation Rights
2.2(q) Additional Excluded Assets
2.3(e) Other Assumed Liabilities
2.4 Other Excluded Liabilities
4.3 Capitalization of Transferred Subsidiaries
4.4 Government Authorizations and Consents Required by Sellers
4.5 Exceptions to Financial Statements
4.6 Exceptions to Ordinary Course
4.7 Title to Transferred Assets
4.8(c) Claims Related to Transferred Intellectual Property
4.9 Material Contracts
4.10 Litigation
4.11 Exceptions to License and Permits
4.12 Environmental Compliance Exceptions
4.14(a) Employees of the Business
4.14(b) Disputes between Employees and Sellers
4.14(c) Employee Policies and Manuals
4.15 Labor Orders and Disputes
4.16.1 Sellers' U.S. Benefit Plans
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Schedule Subject Matter
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4.16.2 Sellers' Non-U.S. Benefit Plans
4.17 Insurance Policies
4.18 Powers of Attorney
4.20 Tax Matters
5.5 Government Authorizations and Consents Required by Buyer
7.1 Covenants of Sellers
11.7 Consents as Conditions to Buyer's Obligations
12.7 Consents as Conditions to Sellers' Obligations
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EXHIBITS
A. Definitions
X. Xxxxxx Trademark License Agreement
C. Transition Services Agreement
MASTER TRANSACTION AGREEMENT
THIS MASTER TRANSACTION AGREEMENT (this "Master Agreement") is entered into
as of July 6, 2000, by and between HATCH ASSOCIATES, INC., a Delaware
corporation ("Buyer"), and XXXXXX GROUP INTERNATIONAL, INC., a Delaware
corporation ("Kaiser").
RECITALS
WHEREAS, Kaiser, directly or through various Affiliates (as defined in
Exhibit A), including the Sellers (as defined in Exhibit A), is engaged in the
Business (as defined in Exhibit A);
WHEREAS, Buyer wishes to purchase and acquire from Kaiser, and Kaiser
wishes to sell, assign and transfer to Buyer, the Transferred Assets (as defined
in Section 2.1), including without limitation the capital stock of the
Transferred Subsidiaries, and Buyer has agreed to assume the Assumed Liabilities
(as defined in Section 2.3), all for the Purchase Price (as defined in Section
3.2), and upon the terms and subject to the conditions, herein set forth;
WHEREAS, Kaiser expects to implement the transactions contemplated by this
Master Agreement through its voluntary bankruptcy case (the "Bankruptcy Case")
pursuant to Chapter 11 of Title 11 of the United States Code (the "Bankruptcy
Code") in the United States Bankruptcy Court for the District of Delaware (the
"Bankruptcy Court"); and
WHEREAS, the transactions contemplated in this Master Agreement involve a
sale, other than in the Ordinary Course of business, of certain of Xxxxxx'x
assets and properties out of Xxxxxx'x bankruptcy estate pursuant to Bankruptcy
Code Sections 363 and 365;
NOW, THEREFORE, in consideration of the premises and of the
representations, warranties and covenants hereinafter set forth, and intending
to be legally bound hereby, the parties agree as follows:
ARTICLE 1
DEFINITIONS
1.1 Definitions. The definitions set forth in Exhibit A are incorporated
herein by reference.
ARTICLE 2
SALE AND PURCHASE OF THE ASSETS
2.1 Transferred Assets. Subject to and upon the terms and conditions set
forth in this Master Agreement, at the Closing, Kaiser shall, or shall cause the
other Sellers to, sell, assign, transfer, convey and deliver to Buyer, and Buyer
shall purchase and acquire from each Seller, all right, title and interest of
each Seller in and to the properties, assets, contracts and rights of the
Business (collectively, the "Transferred Assets"). The Transferred Assets (i)
include assets owned by the Transferred Subsidiaries which otherwise fit within
the meaning of "Transferred Assets" herein, which assets, along with the
Transferred Subsidiaries' liabilities, shall be transferred indirectly by
transferring the capital stock of the Transferred Subsidiaries and (ii) include
without limitation the following:
(a) all of the Fixed Assets described on Schedule 2.1(a);
(b) all accounts receivables of the Business, including those
listed on Schedule 2.1(b), whether billed or unbilled, and cash, cash
equivalents and similar type investments, such as certificates of deposits,
treasury bills and other marketable securities in the Transferred
Subsidiaries as of the Closing Date;
(c) rights in respect of the Transferred Intellectual Property
listed on Schedule 2.1(c);
(d) all equity ownership interests in the Transferred Subsidiaries,
which interests are listed on Schedule 4.3, and any wholly-owned Subsidiary
of Sellers which Buyer requests to be transferred by Sellers to Buyer not
less than seven (7) days prior to Closing (unless any Seller has a business
related reason to object to the transfer);
(e) all of the Assumed Contracts listed on Schedule 2.1(e);
(f) all inventories of office and other supplies located at the
Transferred Facilities listed on Schedule 2.1(f) or specific to the
Business;
(g) all of the prepaid expenses and security deposits reflected on
the Closing Financial Statements that relate to any of the Assumed
Contracts;
(h) all of the Books and Records;
(i) to the extent their transfer is permitted by Applicable Law,
all Consents and Permits specific to the Transferred Facilities, the
Transferred Assets or the Business;
(j) to the extent transferable, all rights under express or implied
warranties from or rights against Sellers' suppliers of goods, services or
properties with respect to the Transferred Assets or the Assumed Contracts;
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(k) all rights to causes of action, lawsuits, claims and demands of
any nature available to the Sellers to the extent that they relate to the
Transferred Assets, the Assumed Liabilities or to the Business, other than
(i) avoidance actions under the Bankruptcy Code and (ii) causes of action,
lawsuits, claims and demands referred to in Section 2.2(h);
(l) to the extent transferable, all guarantees, warranties,
indemnities, bonds, letters of credit and similar arrangements that run in
favor of Sellers in connection with the Transferred Assets;
(m) the insurance policies listed on Schedule 2.1(m) and any
coverage that remains available under such existing insurance policies as
are maintained by the Sellers after Closing for claims specific to the
Transferred Assets or Assumed Liabilities or the Business;
(n) the retentions and advances that relate to the Assumed
Contracts;
(o) additional assets arising in the Ordinary Course of business
between the date hereof and the Closing Date reflected on the Closing
Financial Statements; and
(p) to the extent they exist and are transferable, all rights under
confidentiality and invention agreements with the Transferee Employees but
only to the extent such agreements are specific to the Business.
For the avoidance of doubt, in Sections 2.1(f), (i), and (m) where certain
categories of Transferred Assets are expressly described as those being specific
either to the Business or to any other assets otherwise transferred hereby, the
term "Transferred Assets" (i) shall not include properties, assets, contracts
and rights of the Business which are not exclusively used in the Business but
(ii) shall include any properties, assets, contracts and rights of the Business
identified in the Disclosure Schedule or reflected in the Closing Financial
Statements.
2.2 Excluded Assets. Notwithstanding anything contained in Section 2.1
hereof to the contrary, the Transferred Assets do not include any of the
following (herein referred to collectively as the "Excluded Assets"):
(a) except to the extent set forth in the Kaiser Trademark License
Agreement (the form of which is attached hereto as Exhibit B) or elsewhere
in the Transaction Documents, the names and marks "Kaiser" and "Xxxxxx
Engineers" and any name or xxxx derived from or including the foregoing,
including all corporate symbols or logos incorporating "Kaiser" or "Kaiser
Engineers" and the other intellectual property and intellectual property
rights described on Schedule 2.2(a) (the "Excluded Intellectual Property");
(b) the rights in intellectual property, intangible property
rights, license agreements and software licenses not within the definition
of Transferred Intellectual Property;
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(c) all cash and cash equivalents and similar type investments,
such as certificates of deposit, treasury bills and other marketable
securities, except to the extent provided for in Section 2.1(b) of this
Master Agreement with respect to the Transferred Subsidiaries;
(d) all collateral associated with bonds, letters of credit and
similar arrangements that run in favor of others;
(e) inter-company receivables and payables arising between the
Business and the balance of Xxxxxx'x business from the conduct of the
Business prior to the Closing Date;
(f) all books and records relating to or used in the business of
Sellers and not specific to the Business;
(g) all Policies, other than those, if any, listed on Schedule
2.1(m), maintained by the Sellers, and all rights of action, lawsuits,
claims and demands, rights of recovery and set-off, and proceeds, under or
with respect to such insurance policies;
(h) all rights to causes of action, lawsuits, claims and demands
listed on Schedule 2.2(h);
(i) all right, title and interest of the Sellers (other than the
Transferred Subsidiaries) in and to and any claims for any refund, credit,
rebate or abatement with respect to Taxes of the Business for any period or
portion thereof prior to the Closing Date;
(j) the right to occupy leased premises used by the Business,
except to the extent contemplated by the real property leases for the
Transferred Facilities, which leases are listed on Schedule 4.9, or by the
Transition Services Agreement (the form of which is attached hereto as
Exhibit C);
(k) all assets relating to Seller Benefit Plans, except as
specifically provided in Article 6;
(l) all claims against third parties for Losses suffered in
connection with Excluded Assets and Excluded Liabilities;
(m) the assets that will be utilized by Sellers in providing
services to Buyer under the Transition Services Agreement on or after the
Closing Date;
(n) except to the extent provided under the Ancillary Agreements on
or after the Closing Date, the services available to the Sellers that are
not specific to the Business as conducted prior to the Closing Date;
(o) except to the extent transferable and specific to the
Transferred Assets, the Transferred Facilities or the Business, permits
related to the conduct of the Business;
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(p) all contracts and leases rejected pursuant to Section 365 of
the Bankruptcy Code by Kaiser prior to the Closing;
(q) assets relating to Xxxxxx'x headquarters staff and not used
primarily in the Business, any direct or indirect interest in, or the
business of, Xxxxxx-Xxxx Company LLC, and the contract rights (including,
without limitation, retention account funds and fees payable to Kaiser or
Xxxxxx Netherlands, B.V.) related to the Nova Hut project, the stock of
Xxxxxx Netherlands, B.V., Xxxxxx'x right to receive the Gramercy incentive
fee payable pursuant to Section 3.2, Xxxxxx'x right to receive the fees and
payments pursuant to Section 8.3(a) and (b) (Nova Hut and Worsley) and any
other additional assets listed on Schedule 2.2(q); and
(r) all other properties, assets, contracts and rights of the
Business which are used in common by the Business and the other businesses
of Kaiser and its Subsidiaries (other than the Transferred Subsidiaries and
the properties, assets, contracts and rights identified on the Disclosure
Schedule or in the Closing Financial Statements) and which are not used
primarily in the Business.
For the avoidance of doubt, in Sections 2.2(f), (n) and (o) where certain
categories of Excluded Assets are expressly described as those being specific
either to the Business or to any other assets otherwise transferred hereby, the
term "Excluded Assets" shall (i) include properties, assets, contracts and
rights of the Business which are not exclusively used in the Business and (ii)
not include any properties, assets, contracts and rights of the Business
identified in the Disclosure Schedules or reflected in the Closing Financial
Statements.
2.3 Assumption of Liabilities. Subject to the terms and conditions set
forth herein, at the Closing, Buyer shall assume and agree to pay, honor,
perform and discharge when due the Liabilities and obligations relating to the
Transferred Assets and the Business (other than the Excluded Liabilities) which
are described as follows:
(a) all Liabilities and obligations of the Sellers to be performed
from and after the Closing Date under or relating to the Assumed Contracts
and the Transferred Facilities, including, without limitation, any guaranty
by Kaiser or an Affiliate of Kaiser under an Assumed Contract;
(b) all Liabilities and obligations relating to or arising out of
the conduct of the Business on or after the Closing Date;
(c) pursuant to the Assumed Contracts, all payments required to be
made pursuant to Section 365(b)(i) of the Bankruptcy Code, whether
necessary to cure defaults or otherwise allow the assumption and assignment
of the Assumed Contracts (the "Cure Obligations");
(d) all Liabilities and obligations of Sellers to be assumed by
Buyer in accordance with the terms of Article 6; and
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(e) all Liabilities reflected on the Closing Financial Statements,
or to any extent that such Liabilities were incurred subsequently in a
manner permitted under Section 7.1 of the Master Agreement, or otherwise
listed on Schedule 2.3(e).
The Liabilities and obligations described in Section 2.3 are collectively
referred to as the "Assumed Liabilities." For the avoidance of doubt, all
Liabilities and obligations of each of the Transferred Subsidiaries shall remain
in that Transferred Subsidiary consistent with the sale of the capital stock of
the Transferred Subsidiary.
2.4 Excluded Liabilities. Except as specifically set forth in Section 2.3
and the Transaction Documents, Buyer shall not assume or in any way be
responsible for, and the Sellers shall remain responsible for, the debts,
claims, commitments, liabilities and obligations of Sellers (other than those of
the Transferred Subsidiaries) and the Business (the "Excluded Liabilities"),
including the following:
(a) except to the extent reflected on the Closing Financial
Statements, all Tax liabilities, including penalties and interest, in
respect of periods prior to the Closing Date;
(b) indebtedness for borrowed money relating to the conduct of the
Business for all periods prior to the Closing Date, except as reflected on
the Closing Financial Statements;
(c) Liabilities arising directly out of the Excluded Assets;
(d) inter-company payables and receivables between the Business and
the balance of Sellers' business arising from the conduct of the Business
prior to the Closing Date;
(e) payroll obligations of the Business in respect of periods prior
to the Closing Date;
(f) obligations under any Seller Benefit Plan, except as
specifically provided in Section 2.3(d) and Article 6;
(g) the Liabilities, if any, listed on Schedule 2.4;
(h) any action, suit, proceeding, claim or investigation involving
any of the Sellers, other than those of the Transferred Subsidiaries; and
(i) obligations relating to the Nova Hut project.
For the avoidance of doubt, all of the Liabilities and obligations of each
Transferred Subsidiary will remain with that Transferred Subsidiary consistent
with the sale of the capital stock of the Transferred Subsidiary.
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ARTICLE 3
THE CLOSING
3.1 Place and Date. The closing of the sale and purchase of the
Transferred Assets (the "Closing") and the assumption of the Assumed Liabilities
shall take place at 10:00 a.m., local time, not later than the third business
day following the satisfaction or waiver of the conditions referred to in
Articles 11 and 12 at the offices of Squire, Xxxxxxx & Xxxxxxx L.L.P., 0000
Xxxxxxxxxxxx Xxxxxx, X.X., Xxxxxxxxxx, X.X. or such other time and place upon
which the parties may agree. The day on which the Closing actually occurs is
sometimes referred to herein as the "Closing Date." Notwithstanding the actual
time of Closing on the Closing Date, the Closing shall be deemed to have
occurred as of 12:01 a.m., local time, on the day of the Closing.
3.2 Purchase Price. On the terms and subject to the conditions set forth
in this Master Agreement, at Closing, Buyer shall pay to Sellers the sum of U.S.
$8,000,000 (the "Purchase Price"), less any cash Deposit, by wire transfer of
immediately available funds to an account or accounts designated by Kaiser;
provided however, that the Purchase Price shall be subject to adjustment as set
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forth in Section 3.8. In addition, after Closing and notwithstanding anything
herein to the contrary Buyer shall pay or cause to be paid to Kaiser the first
U.S. $1 million of incentive fee payable to Buyer or any Subsidiary or Affiliate
of Buyer and not otherwise received by Kaiser or any Sellers (other than a
Transferred Subsidiary) under the contract with Xxxxxx Aluminum and Chemical
Corporation relating to the Gramercy project, exclusive of the U.S. $500,000 fee
received on or before June 2, 2000, regardless of whether received prior to or
following Closing, and Buyer shall enter into a reasonable arrangement with
Xxxxxx Aluminum and Chemical Corporation and Kaiser prior to Closing to
implement this provision.
3.3 Deposit. Within two business days of execution of this Master
Agreement, Buyer shall pay to Sellers an amount equal to U.S.$375,000 (the
"Deposit") by wire transfer of immediately available funds to an account
designated by Kaiser where it shall be held in a segregated interest-bearing
escrow account until Closing. In lieu of a Deposit, Buyer may, in its sole
discretion, deliver a letter of credit to Kaiser in a form reasonably
satisfactory to Kaiser from a commercial bank in the United States in an amount
equal to the Deposit. At Closing, any cash Deposit shall be applied and the
Purchase Price reduced by such amount.
3.4 Allocation of Purchase Price.
(a) The parties shall allocate the aggregate consideration received
by Sellers with respect to the Transferred Assets in accordance with
Section 1060 of the Tax Code (including without limitation the shares of
capital stock of the Transferred Subsidiary), as mutually agreed to by the
parties pursuant to the procedure described below. Subject to the
requirements of any applicable Tax law or election, all such mutually
agreed-to allocations shall be used by each party in preparing any filings
required pursuant to Section 1060 of the Tax Code or any similar provisions
of foreign, state or local law and all relevant Income Tax Returns. Neither
Buyer nor Sellers will take any position before any taxing authority or in
any judicial proceeding with respect to Income Taxes that is
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inconsistent with such mutually agreed-to allocations without the prior
written consent of the other party, in the consenting party's sole
discretion. The parties shall exercise commercially reasonable efforts to
support such mutually agreed-to reported allocations in any audit
proceedings initiated by any taxing authority; provided, however, that none
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of Sellers shall have any obligation to pay for an appraisal or in any
other way incur unreasonable or extraordinary out-of-pocket expenses.
(b) Within 10 business days after the Closing Date, Buyer will
provide to Kaiser copies of IRS Form 8594 and any required exhibits thereto
with Buyer's proposed allocation of the consideration received by Sellers
with respect to the Transferred Assets. Within 60 days after the receipt of
such statement, Kaiser will propose to Buyer any changes to such statement.
If Xxxxxx shall fail to propose any such changes within such 60-day period,
then Kaiser shall be deemed to have accepted such statement.
(c) If Buyer and Kaiser cannot agree on an allocation of the
consideration received by Sellers with respect to the Transferred Assets,
then Buyer and Kaiser shall promptly submit such differences to the
independent accounting firm, Ernst & Young, and the decision of such
accounting firm with respect to the resolution of such differences shall be
conclusive and binding on the parties hereto, absent manifest error. The
fees and expenses of such accounting firm shall be shared equally by Buyer
and Kaiser. Kaiser and Buyer agree that any resolution of this allocation
process shall be read into and form part of this Master Agreement.
(d) Kaiser will use its commercially reasonable efforts to expedite
this Section 3.4 process to facilitate the registration of the stock of the
Australian Transferred Subsidiaries, including without limitation
attempting to reach a resolution with Buyer of this aspect of the
allocation issue as soon as practicable after execution and delivery of the
Master Agreement and in no event later than the fifteenth day prior to the
due date for the filing of the related stamp duty. If the resolution
process is not completed by such date through no fault of Buyer, then Buyer
shall select an independent arbitrator who shall, upon reviewing the
materials presented to him, render a decision, and such decision shall be
conclusive and binding absent manifest error.
3.5 Deliveries. At the Closing, (a) Buyer shall deliver to or as directed
by Kaiser the Purchase Price and the agreements, instruments of assumption,
certificates and other documents required to be delivered by Buyer pursuant to
Article 12 and (b) Sellers shall deliver to Buyer the agreements, instruments of
transfer, certificates and other documents required to be delivered by Sellers
pursuant to Article 11.
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3.6 Closing Financial Statements. Not less than seven (7) days prior to
the Sale Hearing, Kaiser shall deliver to Buyer an updated set of financial
statements similar to the Financial Statements (the "Closing Financial
Statements"), prepared as of the most recent available business day prior to its
delivery date. The Closing Financial Statements shall be prepared in a manner
consistent with the Financial Statements and the terms of this Master Agreement
and shall only reflect the Transferred Assets and Assumed Liabilities as of the
date reflected thereon on a basis consistent with the Financial Statements,
including without limitation the estimate of working capital accounts. The
Closing Financial Statements will be derived from a combination of system
reports and working capital estimates (including without limitation accounts
receivable, work-in-process, accounts payable and cash of Transferred
Subsidiaries). Kaiser shall make, and shall cause its Subsidiaries to make,
financial personnel, records and information available to Buyer to assist Buyer
in confirming the information contained in the Closing Financial Statements. The
parties shall discuss the resolution of any open issues promptly with a view to
achieving resolution prior to the Sale Hearing. At the time of the Sale Hearing,
the calculation of Net Book Value shall be deemed final to the extent that any
and all objections are resolved.
3.7 Consents of Third Parties. Notwithstanding anything to the contrary
in this Master Agreement, this Master Agreement shall not constitute an
agreement to assign or transfer any Consent from a Governmental Authority,
instrument, contract (including Contracts which fit within the definition of the
Assumed Contracts), lease, or other agreement or arrangement or any claim, right
or benefit arising thereunder or resulting therefrom, to the extent that such
assignment or transfer or an attempt to make such an assignment or transfer
cannot be made pursuant to Section 365 of the Bankruptcy Code without the
consent or approval of a third party. In the event any such consent or approval
is not obtained on or prior to the Closing Date, the applicable Seller shall
cooperate with Buyer in any lawful arrangement proposed by Buyer to provide that
Buyer shall receive the benefits under any such Consent, instrument, contract,
lease or other agreement or arrangement, provided, however, that Buyer shall
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undertake to pay, perform, discharge or satisfy the corresponding liabilities
and obligations for the enjoyment of such benefit to the extent Buyer would have
been responsible therefor if such consent or approval had been obtained.
Notwithstanding anything to the contrary in this Section 3.7, nothing in this
Section 3.7 shall reduce or otherwise affect the obligation of Sellers to cause
the Assumed Contracts to be assumed and assigned to Buyer as required by the
other provisions of this Master Agreement.
3.8 Closing Date Adjustment.
(a) The Purchase Price will be reduced, dollar for dollar, at the
Closing to the extent that the Net Book Value of the Business as identified
in the Closing Financial Statements ("Closing Net Book Value") is less than
U.S. $6,685,000. The Purchase Price will be increased, dollar for dollar,
at the Closing to the extent that the Closing Net Book Value of the
Business is more than U.S. $ 6,685,000. Notwithstanding anything herein to
the contrary, no Purchase Price adjustment pursuant to Section 3.8 shall be
made if the difference between the Net Book Value reflected on the
Financial Statements and the Closing Net Book Value is not greater than
U.S. $200,000; provided, however, that if the amount exceeds the U.S.
-------- -------
$200,000 amount, then the Purchase Price adjustment called for
-9-
herein will be made dollar-for-dollar for the entire amount of the
difference between Net Book Value reflected on the Financial Statements and
the Closing Net Book Value.
ARTICLE 4
REPRESENTATIONS AND WARRANTIES OF KAISER
Except as set forth in the Disclosure Schedule delivered to Buyer
contemporaneously herewith (the "Disclosure Schedule"), of which the Schedules
referred to below are a part, and in the documents and other materials
identified in the Disclosure Schedule (it being agreed that any matter disclosed
in the Disclosure Schedule with respect to any section of this Master Agreement
shall be deemed to have been disclosed with respect to all other sections of
this Master Agreement if its relevance to such other sections is reasonably
discernable from its disclosure), and subject to the limitations contained in
Section 14.1, as of the date of this Master Agreement, Kaiser makes to Buyer the
following representations and warranties.
4.1 Organization, Standing, Etc. of Sellers. Each Seller is a corporation
duly incorporated and validly existing and in good standing under the laws of
the jurisdiction where it is organized and has all requisite corporate power and
authority to carry on the Business as currently conducted by it and to own or
lease and to operate the properties of the Business used by it. Each Seller is
qualified to do business in each jurisdiction in which the Business is conducted
that requires such qualification by such Seller and where the failure to so
qualify would have a Material Adverse Effect on the Business. For the purposes
of the Transaction Documents, a "Material Adverse Effect on the Business" means
any material adverse change in, or material adverse effect on, the assets,
liabilities, business or operations of the Transferred Assets or the Business
taken as a whole. Each Seller (other than the Transferred Subsidiaries) is
currently a debtor-in-possession in the Bankruptcy Case pursuant to the
Bankruptcy Code, and retains full authority and power to operate its business
and affairs pursuant to sections 1107 and 1108 of the Bankruptcy Code, with no
trustee, examiner, facilitator or other officer or agent with similar authority
or powers to a trustee, examiner or facilitator having been appointed in such
Bankruptcy Case.
4.2 Corporate Authorization; Enforceability.
(a) Subject to any required approval by the Bankruptcy Court, the
execution, delivery and performance of this Master Agreement and all other
documents executed or to be executed pursuant to this Master Agreement by
any Seller, and the consummation of the Contemplated Transactions
(including without limitation the transfer of the capital stock of the
Transferred Subsidiaries) have been duly authorized by all necessary
corporate action on the part of each Seller. Subject to any required
approval by the Bankruptcy Court, this Master Agreement and the Ancillary
Agreements executed or to be executed by a Seller have been, or will have
been, at the time of their respective executions and deliveries, duly
executed and delivered by a duly authorized officer of each such Seller.
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(b) Subject to any required approval by the Bankruptcy Court, this
Master Agreement and each Ancillary Agreement executed or to be executed by
a Seller constitutes, or at the time executed by a Seller will constitute,
the valid and legally binding obligation of each Seller, enforceable in
accordance with its terms.
4.3 Charters and Bylaws; Capitalization of Transferred Subsidiaries.
Copies of the charters and bylaws and other organizational documents of the
Sellers and the Transferred Subsidiaries have been made previously available to
Buyer, and each such copy is true, correct and complete. All returns,
particulars, filings, notices and other documents required to be delivered by
the Australian Transferred Subsidiaries to the Australian Securities and
Investments Commission or other government agency, whether federal, state, local
or foreign, have been duly delivered, except where the failure to make such
delivery would not have a Material Adverse Effect on the Business. The
execution, delivery and performance of this Master Agreement and the Ancillary
Agreements executed or to be executed by Sellers and the consummation of the
Contemplated Transactions (including without limitation the transfer of the
capital stock of the Transferred Subsidiaries) will not cause or result in any
violation of or default under any provision of the charter or bylaws of any
Seller. The minute books, registers and all other books and records of each
Transferred Subsidiary (whether or not required to be kept or maintained) comply
with legal requirements and are complete and accurate in all respects, except
where such noncompliance, inaccuracy or incompleteness would not have a Material
Adverse Effect on the Business. Each Seller has complied in all material
respects with its charter and by-laws except where such noncompliance would not
have a Material Adverse Effect on the Business. Schedule 4.3 sets forth the
authorized and outstanding capital stock of the Transferred Subsidiaries, all of
which is owned beneficially and of record by one or more of the Sellers or by a
nominee whose actions with respect thereto are under the direction of one or
more Sellers. Except as set forth on Schedule 4.3, none of Kaiser or any of the
Transferred Subsidiaries has any outstanding securities convertible into or
exercisable for any shares of capital stock of any Transferred Subsidiary, nor
does it have any outstanding rights to subscribe for or to purchase, or any
options for the purchase, or any arrangements providing for the issuance
(contingent or otherwise), of, or any calls against, commitments by or claims
against it of any character relating to, any shares of capital stock of any
Transferred Subsidiary or any securities convertible into or exchangeable or
exercisable for any shares of capital stock of any Transferred Subsidiary.
4.4 Governmental Authorizations and Consents. Except as set forth on
Schedule 4.4, no consents, licenses, approvals or authorizations of, or
registrations or declarations with, any Governmental Authority or any third
party are required to be obtained or made by any Seller in connection with the
execution, delivery, performance, validity and enforceability of this Master
Agreement or any Ancillary Agreement, other than (a) any required Bankruptcy
Court approval, and (b) other consents, licenses, approvals, authorizations,
registrations or declarations, where the failure to obtain such would not have a
Material Adverse Effect on the Business.
4.5 Financial Statements. Kaiser has delivered to Buyer the following
financial statements, each as of March 31, 2000 (the "Financial Statements
Date"): (a) pro forma statements of the Transferred Assets and Assumed
Liabilities, other than those of the Transferred Subsidiaries; (b) balance
sheets for the Transferred Subsidiaries; and (c) related statements of revenue
and direct expense for the period January 1, 2000 through March 31, 2000 (such
statements hereinafter being referred to as the "Financial Statements"). The
Financial
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Statements have been prepared in accordance with the accounting records and
policies of Kaiser and with GAAP, and fairly present in all material respects
the Transferred Assets and the Assumed Liabilities of the Business as of the
dates thereof, except as agreed to by the parties and attached hereto as
Schedule 4.5.
4.6 Absence of Certain Changes or Events. Since the Financial Statements
Date, each Seller has conducted its operations related to the Business in the
Ordinary Course of business except: (i) as set forth on Schedule 4.6, (ii) the
filing of the Bankruptcy Case and any actions taken in connection therewith, and
(iii) activities related to the Contemplated Transactions. No meeting has been
convened or resolution proposed, or petition presented, and no order has been
made, for the winding-up of any Transferred Subsidiary. No receiver, receiver
and manager, provisional liquidator, liquidator or other officer of the court
has been appointed in relation to any Transferred Subsidiary.
4.7 Title to Transferred Assets.
(a) Except as set forth on Schedule 4.7, and except for real and
personal property subject to leases or licenses, each Seller has (i) good
title to or other valid ownership rights in the Transferred Assets and in
the case of leases or licenses, a good and valid leasehold or license
interest and (ii) the Transferred Assets are free of all liens, claims or
encumbrances. At the Closing, Sellers shall have the right to transfer
such title, leasehold interests and license rights to Buyer pursuant to the
Contemplated Transactions, free of any liens, claims and encumbrances
except as set forth on Schedule 4.7.
(b) Schedule 2.1(e) sets forth all personal property leases which
constitute Assumed Contracts. There exist no defaults by any Seller
(except for defaults resulting from the commencement of the Bankruptcy
Case) or, to Sellers' Knowledge, any default or threatened material default
by any third party thereunder, that has affected or could reasonably be
expected to affect the rights and privileges of any Seller under an any
such personal property lease and which would result in a Material Adverse
Effect on the Business. Except as provided on Schedule 2.1(e), the
assumption by Buyer of such personal property leases and the consummation
of the Contemplated Transactions shall not result in any default under any
such lease or impose any penalty on Buyer which default or penalty could
reasonably be expected to cause a Material Adverse Effect on the Business.
(c) This Section 4.7 does not apply to the Transferred Intellectual
Property.
4.8 Transferred Intellectual Property.
(a) The Sellers own, or are licensed or otherwise possess the right to
use, all the Transferred Intellectual Property, and the Transferred
Intellectual Property, together with the Excluded Intellectual Property, is
all the intellectual property necessary to conduct the Business
substantially as currently conducted by the Sellers in all material
respects.
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(b) Schedule 2.1(c) includes a list of patents, registered copyrights,
registered trademarks, registered trade names and registered service marks,
and any pending applications therefor, included in the Transferred
Intellectual Property.
(c) To the Sellers' Knowledge, except as set forth on Schedule 4.8(c),
no claims with respect to the Transferred Intellectual Property have been
asserted and are pending (i) to the effect that the sale, licensing or use
of any of the products or services of the Business infringes any other
party's valid copyright, trademark, service xxxx, trade secret or other
intellectual property right, (ii) against the use by any Seller of any
trademarks, service marks, trade names, trade secrets, copyrights, patents,
technology, know-how or computer software programs or applications used in
the Business as currently conducted, or (iii) challenging the ownership or
use by any Seller or any of the Transferred Intellectual Property that any
Seller owns or uses or purports to own or use, nor, to Sellers' Knowledge,
is there a valid basis for such a claim described in this Section 4.8(c).
(d) To Sellers' Knowledge, none of the Transferred Intellectual
Property is subject to any outstanding order, ruling, decree, judgment or
stipulation by or with any court, arbitrator or administrative agency which
would impair the ability of Buyer to utilize the Transferred Intellectual
Property or otherwise impair its value in any manner which would result in
a Material Adverse Effect on the Business.
4.9 Assumed Contracts. Kaiser has made available to Buyer a copy or
description of all outstanding Assumed Contracts constituting:
(a) All customer contracts and open purchase orders of the Business
with a reasonably expected value in excess of U.S. $200,000 per annum;
(b) All pending bids for customer contracts with a reasonably
expected value in excess of U.S. $200,000 per annum;
(c) All contracts for the employment of any Person by a Seller
specific to the Business and providing for cash compensation equal to or
greater than U.S. $50,000 per annum;
(d) All collective bargaining agreements specific to the Business;
(e) All consulting agreements in excess of U.S. $50,000 to which
the Sellers are parties in connection with the conduct of the Business;
(f) All joint venture, teaming and similar arrangements to which
the Sellers are parties in connection with the Business, whether
incorporated or unincorporated;
(g) All agreements for the purchase by a Seller of equipment
specific to the Business involving outstanding commitments in excess of
U.S. $125,000;
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(h) All notes and installment obligations and other instruments and
contracts specific to the Business and relating to any borrowing of, or
issuance of letters of credit for, an amount in excess of U.S. $125,000 by
one or more Sellers;
(i) All leases of real or personal property involving payments of
more than U.S. $125,000 per annum to be assumed by Buyer; and
(j) All agreements materially limiting the freedom of a Seller to
compete in the Business with any Person or other entity or in any
geographical area, and any other Contract which is material to the
Business.
A list or description of each of the items described above (the "Material
Contracts") is set forth on Schedule 4.9. As of the date of this Master
Agreement, except as disclosed on Schedule 4.9, all Material Contracts are in
full force and effect.
4.10 Litigation. Except as set forth on Schedules 4.10 and 4.12 and other
than the Bankruptcy Case, there are no actions, suits, proceedings or
governmental investigations pending against any Seller or, to Sellers'
Knowledge, overtly threatened, in any jurisdiction anywhere in the world
involving the Business or the Transferred Assets, at law or in equity or before
any Governmental Authority, or that have been settled, dismissed or resolved on
or since March 31, 2000, that would reasonably be expected to have a Material
Adverse Effect on the Business following the Closing Date. No Seller is subject
to any judgment, stipulation, order or decree arising from any action, suit,
proceeding or investigation that individually or in the aggregate would
reasonably be expected to have a Material Adverse Effect on the Business
following the Closing Date. Except for the Bankruptcy Case, no Seller is subject
to any winding-up, receivership or other similar proceedings which relate to
insolvency.
4.11 Licenses and Permits. Each Seller has all licenses, permits and other
authorizations from Governmental Authorities necessary for the conduct of the
Business as conducted by the Sellers prior to the date hereof (collectively
"Permits"), except where the failure to have such Permits could not reasonably
be expected to result in a Material Adverse Effect on the Business. Except as
set forth on Schedule 4.11, (a) each of said Permits is in full force and
effect, (b) the Business is in compliance with the terms, provisions and
conditions thereof, except where the failure to be so in compliance could not
reasonably be expected to result in a Material Adverse Effect on the Business,
(c) to Sellers' Knowledge there are no outstanding violations, notices of
noncompliance, judgments, consent decrees, orders or judicial or administrative
actions, investigations or proceedings adversely affecting any of said Permits,
and (d) to Sellers' Knowledge no condition exists and no event has occurred
which (whether with or without notice, lapse of time or the occurrence of any
other event) would permit the suspension or revocation of any material Permits
other than by expiration of the term set forth therein. Sellers make no
representation or warranty with respect to the transferability of the Permits to
Buyer.
4.12 Environmental Compliance. Except as set forth in Schedule 4.12, to
Sellers' Knowledge the conduct of the Business by Sellers and any Transferred
Facility owned, leased or operated by any Seller has at all times complied and
currently complies in all material respects with all Environmental Laws, except
where the failure to so comply would not reasonably be
- 14 -
expected to result in a Material Adverse Effect on the Business. "Environmental
Laws" shall mean all applicable U.S. and foreign (including without limitation
Australia) federal, state and local laws, ordinances and regulations pertaining
to air and water quality, Hazardous Materials, waste, disposal or other
environmental matters, including the Clean Water Act, the Clean Air Act, the
Federal Water Pollution Control Act, the Solid Waste Disposal Act, the Resource
Conservation Recovery Act, the Occupational Health and Safety Act, the
Comprehensive Environmental Response, Compensation, and Liability Act, and the
rules, regulations and ordinances of the cities and other jurisdictions in which
the Business is located (including without limitation the Environment Protection
(Impact of Proposals) Xxx 0000, the Hazardous Waste (Regulation of Exports and
Imports) Xxx 0000, the National Environment Protection Council Xxx 0000, the
National Environment Protection Measures (Implementation) Xxx 0000, the Ozone
Protection Xxx 0000, the Environment Protection and Biodiversity Conservation
Xxx 0000, the Environment Reform (Consequential Provisions) Xxx 0000, the
Environment Protection (Impact of Proposals) Xxx 0000, the Intergovernmental
Agreement on the Environment 1992, and the Occupation Health and Safety Act
(Commonwealth, State or Territory)), the U.S. Environmental Protection Agency
and all other applicable Governmental Authorities.
4.13 Absence of Certain Business Practices. To Sellers' Knowledge, no
Seller nor any officer, employee or agent of any Seller, or any other Person
acting on their behalf, has, directly or indirectly, since the date of formation
of such Seller, respectively, given, offered, solicited or agreed to give, offer
or solicit any contribution, gift, bribe, rebate, payoff, influence payment,
kickback or other payment, regardless of form and whether in money, property or
services, to any customer, supplier, governmental employee or other Person who
is or may be in a position to help or hinder the Business in connection with the
conduct of the Business (a) which subjected or could reasonably be expected to
have subjected a Seller to any material damage or penalty in any civil, criminal
or governmental litigation or proceeding, (b) which, if not given in the past,
could reasonably be expected to have had a Material Adverse Effect on the
Business, (c) which, if not continued in the future, could reasonably be
expected to have a Material Adverse Effect on the Business or subject a Seller
to suit or penalty in any private or governmental litigation or proceeding, (d)
for any purposes described in Section 162(c) of the Tax Code, or (e) for the
purpose of establishing or maintaining any concealed fund or concealed bank
account.
4.14 Personnel Matters.
(a) Sellers have heretofore provided to Buyer a list of all of the
employees for which Buyer will be responsible pursuant to Section 2.3(d)
and Article 6 (such employees, collectively, "Employees of the Business"),
which list is attached hereto as Schedule 4.14(a), and their respective job
titles and current salaries or wages.
(b) Except as set forth on Schedule 4.14(b), to Sellers' Knowledge
there are no material employment-related disputes, grievances, or
disciplinary actions pending or threatened, by or between any of the
Sellers and any Employees of the Business.
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(c) All currently effective personnel policies and manuals of the
Sellers are listed on Schedule 4.14(c) and true, accurate, and complete
copies of all such written personnel policies and manuals have been made
available to Buyer.
4.15 Labor Matters. This Section 4.15 does not extend to the subject
matter of Section 4.16. Except as set forth on Schedule 4.15, in relation to the
conduct of the Business:
(a) No Seller is obligated by, or subject to, any order of the U.S.
National Labor Relations Board, the Australian Industrial Relations
Commission and the Federal Court or other foreign or U.S. labor board or
administration, or any unfair labor practice decision.
(b) No Seller is a party or is subject to any pending or, to Sellers'
Knowledge, threatened labor or civil rights dispute, controversy or
grievance or any unfair labor practice proceeding with respect to claims
of, or obligations of, any employee or group of employees. No Seller has
received any notice that any labor representation request is pending or is
threatened with respect to Employees of the Business.
(c) Each Seller is in compliance in all material respects with all
Applicable Laws respecting employment and employment practices, terms and
conditions of employment and wages and hours.
(d) To Sellers' Knowledge, no Employees of the Business or former
employee of any Seller has any claim against any Seller (whether under
Applicable Law, pursuant to any employment agreement, or otherwise) on
account of, or for: (i) overtime pay, other than for the current payroll
period; (ii) wages or salary (excluding bonuses and amounts accruing under
any pension or profit-sharing plan, including but not limited to any
Benefit Arrangement (as such term is defined in Section 4.16.1(a))) for a
period other than the current payroll period; or (iii) vacation, time off
or pay in lieu of vacation or time off, other than vacation or time off (or
pay in lieu thereof) earned in respect of the current or past fiscal year
of Sellers or accrued on the Closing Financial Statements.
4.16 Seller Benefit Plans.
4.16.1 United States.
(a) Schedule 4.16.1 lists and identifies (i) each employee pension
benefit plan, as defined in Section 3(2) of ERISA (a "Pension Plan"); (ii)
each employee welfare benefit plan, as defined in Section 3(1) of ERISA (a
"Welfare Plan"); and (iii) each compensation and employment arrangement,
including, but not limited to, any fringe benefit, incentive compensation,
stock option, stock purchase, bonus, severance, deferred compensation, and
supplemental executive compensation plan or employment agreement (a
"Benefit Arrangement"), that is maintained by a Seller for Employees of the
Business based in the United States or to which a Seller is obligated to
make contributions for their benefit (collectively, the "U.S. Benefit
Plans"). Copies of all U.S. Benefit Plans have been provided or made
available to Buyer, including, but not limited to (i) each Pension Plan and
any related trust agreement (including all amendments to such Pension Plan
and
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trust) and its most recent summary plan description, the most recent
determination letter issued by the IRS, and (ii) each Welfare Plan and
Benefit Arrangement and any related insurance contracts or other funding
arrangement, administrative services agreement and summary plan description
and the most recent annual report on Form 5500 required to be filed with
the IRS in respect of any Pension Plan, Welfare Plan and Benefit
Arrangement. Except for the 1999 and 2000 contributions to the Pension
Plans which by law are not yet required to be made, all contributions have
been made to the Pension Plans. Except as disclosed on Schedule 4.16.1, no
Seller maintains or contributes to any Welfare Plan that provides benefits
to employees after termination of employment other than as required by Part
6 of Title I of ERISA.
(b) Except as disclosed on Schedule 4.16.1, neither any Seller nor any
ERISA Affiliate is obligated to contribute to any multiemployer plan, as
defined in Section 3(37) of ERISA nor has been obligated to contribute to
any multiemployer plan, at any time during the most recent five years, and,
to Sellers' Knowledge, for any prior period. As used herein, the term
"ERISA Affiliate" shall mean a (i) corporation which is a member of the
same controlled group of corporations (within the meaning of Section 414(b)
of the Tax Code) as Kaiser, (ii) partnership or other trade or business
(whether or not incorporated) under common control (within the meaning of
Section 414(c) of the Tax Code) with Kaiser, (iii) member of the same
affiliated service group (within the meaning of Section 414(m) of the Tax
Code) as Kaiser, (iii) any corporation described in clause (i) above or any
partnership or trade or business described in clause (ii) above, and (iv)
any other entity which is required to be aggregated with Kaiser pursuant to
the provisions of Section 414(o) of the Tax Code. With respect to any such
multiemployer plan, no Seller or ERISA Affiliate had incurred, or is
reasonably likely to incur, any withdrawal liability under Title IV of
ERISA, nor is any such plan in reorganization.
(c) No Pension Plan is subject to Title IV of ERISA. No liability
under Subtitle C or D of Title IV of ERISA has been or is expected to be
incurred by any Seller or any ERISA Affiliate with respect to any "single-
employer plan," within the meaning of Section 4001(a)(15) of ERISA,
currently or formerly maintained by Kaiser or any ERISA Affiliate. All
contributions required to be made by any ERISA Affiliate to any employee
benefit plan subject to Section 412 of the Tax Code or Section 302 of ERISA
have been timely made. No employee benefit plan subject to Section 412 of
the Tax Code sponsored, maintained or contributed to by Kaiser or any ERISA
Affiliate has an "accumulated funding deficiency" (whether or not waived)
within the meaning of Section 412 of the Tax Code or Section 302 of ERISA
and no ERISA Affiliate has an outstanding funding waiver.
(d) Each Pension Plan which is intended to be qualified under Section
401(a) of the Tax Code as currently in effect has been determined by the
IRS to be so qualified and each trust related to any such Pension Plan has
been determined to be exempt from federal income tax under Section 501(a)
of the Tax Code. There have been no prohibited transactions (as described
in Section 406 or Section 4975 of the Tax Code) with respect to any Pension
Plan for which there is any outstanding liability. No material litigation
or administrative or other proceedings involving the U.S. Benefit Plans has
occurred which would reasonably be expected to have a Material Adverse
Effect on the Business.
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(e) Each U.S. Benefit Plan has been administered in accordance with
its terms and Applicable Law except where the failure to be so administered
would not have a Material Adverse Effect on the Business.
4.16.2 Non-U.S. Employee Benefit Plans.
(a) Except as set forth on Schedule 4.16.2, with respect to all
Employees of the Business whose employment is based outside of the United
States, none of the Sellers presently maintains, contributes to or has any
liability under any material non-U.S. bonus, incentive compensation, profit
sharing, retirement, pension, group insurance, death benefit, health,
disability, stock option, stock purchase, savings, deferred compensation,
severance pay or termination pay, welfare or other employee benefit or
fringe benefit plan, program or arrangement, excluding any foreign
government sponsored or mandated plan, program or arrangement affecting
such employees (including without limitation compulsory superannuation
under the Superannuation Guarantee (Administration) Act 1992) ("Government
Sponsored or Mandated Plans"). The plans, programs and arrangements set
forth on Schedule 4.16.2 are referred to herein as the "Non-U.S. Employee
Benefit Plans."
(b) With respect to each of the Non-U.S. Employee Benefit Plans,
Kaiser has made or will, prior to the Closing Date, make available to Buyer
copies of:
(i) The plan documents, including any related trust agreements or
insurance contracts, including amendments thereto, or a written
summary of the terms and conditions of the plan if there is no written
plan document.
(ii) With respect to any Non-U.S. Employee Benefit Plan
maintained primarily for the benefit of employees of a Seller, the
most recent actuarial valuations and financial statements, if any.
(c) The Non-U.S. Employee Benefit Plans and Government Sponsored or
Mandated Plans administered by Sellers have been administered and are in
material compliance with all material requirements of Applicable Law and
the terms of each such plan except where such failure would not have a
Material Adverse Effect on the Business; any Non-U.S. Employee Benefit Plan
which is intended to be qualified under applicable law or registered or
approved by a Governmental Authority has been determined to be so
qualified, registered or approved by the appropriate Governmental
Authority; and nothing has occurred between the date of the last such
determination and the Closing Date to cause the appropriate Governmental
Authority to revoke such determination or which would materially adversely
affect the continuing qualified, registered or approved status of such Non-
U.S. Employee Benefit Plan, except where such revocation or change in
status would not have a Material Adverse Effect on the Business.
(d) All contributions (including premiums) required by law or contract
to have been paid or accrued, under or with respect to the Non-U.S.
Employee Benefit Plans and Government Sponsored or Mandated Plans to the
Closing Date (including periods from
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the first day of the then current plan year to the Closing Date) will have
been paid or accrued prior to the Closing Date except to the extent failure
to pay or accrue such contributions would not be reasonably expected to
have a Material Adverse Effect on the Business.
(e) The accrued benefits provided under each Non-U.S. Employee Benefit
Plan and Government Sponsored or Mandated Plans providing retirement,
severance or similar benefits (to the extent established and formally
communicated to employees), determined as of the Closing Date, will not
exceed the fair market value as of such date of the assets applicable to
such Non-U.S. Employee Benefit Plan or Government Sponsored or Mandated
Plan, or the book reserve, balance sheet reserve or other reserve with
respect thereto as of the Closing Date. Notwithstanding the foregoing, the
only amounts so required to be so funded or reserved shall be the amounts
required to be funded, reserved or provided for in conformity with
generally accepted accounting principles in the applicable country. For
this purpose, "accrued benefits" means the present value of all retirement,
severance or similar benefits (as described above) under a plan recognizing
salary and service to Closing.
(f) There are no material pending or, to Sellers' Knowledge,
threatened claims (other than routine claims for benefits), investigations,
litigation or other enforcement actions against Sellers or any of their
officers, directors, employees or agents, with respect to any of the Non-
U.S. Employee Benefit Plans, nor is there any other liability with respect
to such plans except those incurred in the normal course of operation or
those which would not have a Material Adverse Effect on the Business.
(g) No material improvement in the benefits accrued or provided under
the Non-U.S. Employee Benefit Plans will be made on or before the Closing
Date.
4.17 Insurance. Schedule 4.17 contains a list of all material insurance
policies maintained by or on behalf of or covering each Seller in connection
with the Business (the "Policies"). Each Seller has made available to Buyer
copies of all current declaration sheets relating to the Policies. Except as
noted on Schedule 4.17, as of the date of the Agreement, the Policies are, to
Sellers' Knowledge, in full force and effect, no notices of cancellation or
nonrenewal have been received by any Seller with respect thereto, and all
premiums due thereon have been paid.
4.18 Powers of Attorney. Except as set forth on Schedule 4.18, none of
the Sellers has given any irrevocable power of attorney (other than such powers
of attorney given in the Ordinary Course of business with respect to routine
matters or as may be necessary or desirable in connection with the consummation
of the Contemplated Transactions) to any person, firm, or corporation for any
purpose whatsoever with respect to the Business.
4.19 Brokers. With the exception of fees and expenses payable to Xxxxxxx
Xxxxx & Associates, Inc. and Jefferies & Co., Inc., which shall be paid by
Kaiser, all negotiations relating to this Master Agreement, and the Contemplated
Transactions, have been carried on without the participation of any Person
acting on behalf of any Seller or such party's Affiliates in such manner as to
give rise to any valid claim against Buyer for any brokerage or finder's
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commission, fee or similar compensation, or for any bonus payable to any
officer, director, employee, agent or sales representative of or consulant to
any Seller or such party's Affiliates upon consummation of the Contemplated
Transactions.
4.20 Taxes. Except as set forth on Schedule 4.20, with respect to Taxes:
(a) Each Seller has properly completed and filed or caused to
be filed or shall properly complete and file or cause to be filed, within
the time prescribed by law, including extensions, all Tax Returns with
respect to the Transferred Assets or Transferred Subsidiaries that are or
were required to be filed under federal, state, local or any foreign laws
prior to the Closing Date, except where the failure to file such Tax
Returns would not have a Material Adverse Effect on the Business.
(b) Each Transferred Subsidiary has, within the time and in
the manner prescribed by law, paid or caused to be paid (and until the
Closing will, within the time and in the manner prescribed by law, pay or
cause to be paid) all Taxes due and payable prior to the Closing, except
where the failure to pay such Taxes would not have a Material Adverse
Effect on the Business.
(c) No extensions or waivers of statutes of limitation with
respect to any Tax Returns of any Transferred Subsidiary (or its parent if
filing a consolidated or combined Tax Return) have been given by or
requested from any of the Transferred Subsidiaries (or such parent).
(d) None of the Transferred Subsidiaries, or any entity in
which a Transferred Subsidiary owns an interest, is a party to or bound by
any tax indemnity, tax sharing or tax allocation agreement that will not be
terminated on the Closing Date.
4.21 Accounts Receivable. The accounts receivable of the Business
reflected on the Financial Statements, are valid and existing receivables which
arose in the Ordinary Course and are collectible substantially in accordance
with their terms and at their recorded amounts, subject to a reserve for bad
debts as will be set forth in the Closing Financial Statements.
4.22 Adequacy of Assets. Except as set forth on Schedule 4.22, the
Transferred Assets and the services to be provided pursuant to the terms of the
Transition Services Agreement are sufficient for the conduct of the Business on
the Closing Date in substantially the same manner in which it has been conducted
by Sellers since March 31, 2000.
ARTICLE 5
REPRESENTATIONS AND WARRANTIES OF BUYER
Buyer represents and warrants to Kaiser as set forth below as of the date
of this Master Agreement:
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5.1 Organization and Standing of Buyer. Buyer is a corporation duly
organized, validly existing and in good standing under the laws of the
jurisdiction where it is organized and has all requisite corporate power and
authority to enter into this Master Agreement and the Ancillary Agreements, to
carry out the Contemplated Transactions and to perform its obligations
hereunder. Buyer is a domestic corporation within the meaning of Section 7701 of
the Tax Code.
5.2 Authorization. The execution, delivery and performance of this Master
Agreement and the Ancillary Agreements executed or to be executed by Buyer
pursuant to this Master Agreement, and the consummation of the Contemplated
Transactions have been duly authorized by all necessary corporate and other
action on the part of Buyer. This Master Agreement and the Ancillary Agreements
executed or to be executed by Buyer have been, or will have been, at the time of
their respective executions and deliveries, duly executed and delivered by a
duly authorized officer of Buyer.
5.3 Enforceability. This Master Agreement and each Ancillary Agreement
constitutes, or when executed and delivered will constitute, the valid and
legally binding obligation of Buyer, enforceable in accordance with its terms,
except as such enforceability may be limited by equitable principles and by
applicable bankruptcy, insolvency, reorganization, arrangement, moratorium or
similar laws relating to or affecting the rights of creditors generally.
5.4 Compliance with Other Instruments and Laws. The execution, delivery
and performance of this Master Agreement and the Ancillary Agreements executed
or to be executed by Buyer pursuant to this Master Agreement, and the
consummation of the Contemplated Transactions will not conflict with or result
in any violation of or default under any provision (a) of the charter or bylaws
of Buyer, or (b) of any mortgage, indenture, trust, lease, partnership or other
agreement or other instrument, permit, concession, grant, franchise, license,
judgment, order, decree, statute, law, ordinance, rule or regulation applicable
to Buyer or any of its properties or assets, the result of which, with respect
to items identified in clause (b) would (either individually or in the
aggregate) have a material adverse effect on the operations or financial
condition of Buyer and its subsidiaries, taken as a whole, or would materially
impair Buyer's ability to consummate the Contemplated Transactions (a "Material
Adverse Effect on Buyer").
5.5 Governmental Authorizations and Consents. Except as set forth on
Schedule 5.5, no consents, licenses, approvals or authorizations of, or
registrations or declarations with, any Governmental Authority, bureau, agency
or commission, or any third party, are required to be obtained or made by Buyer
in connection with the execution, delivery, performance, validity and
enforceability of this Master Agreement or the other Ancillary Agreements, other
than (a) Bankruptcy Court approval, and (b) other consents, licenses, approvals,
authorizations, registrations or declarations, where the failure to obtain such
would not have a Material Adverse Effect on Buyer. Buyer is not currently
engaged in, or contemplating, any business transaction that would be reasonably
expected to hinder or delay the authorizations and consents referred to in this
Section 5.5.
5.6 Litigation. As of the date of this Master Agreement, no action, suit,
proceeding or governmental investigation is pending or, to the knowledge of
Buyer, threatened, against
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Buyer or its properties, at law or in equity or before any Governmental
Authority that seeks to question, delay or prevent the consummation of the
Contemplated Transactions.
5.7 Access. Buyer has received and reviewed the Financial Statements and
is acquainted with the Business. Buyer has had an opportunity to review the
assets, books, records and contracts of the Business made available to it by
Sellers, and has been given the opportunity to meet with officers and other
representatives of Kaiser for the purpose of investigating and obtaining
information regarding the Business operations and its financial and legal
affairs.
5.8 Financial Capacity. Buyer has the financial capacity to consummate the
Contemplated Transactions within its existing credit lines as previously
disclosed to Kaiser.
5.9 Brokers. No agent, broker, Person or firm acting on behalf of Buyer or
its stockholders is, or will be, entitled to any commission or broker's or
finder's fees from any of the parties hereto, or from any Person controlling,
controlled by or under common control with any of the parties hereto, in
connection with any of the Contemplated Transactions.
5.10 Buyer Awareness. As of the date of this Master Agreement, Buyer is not
aware of any fact, circumstance or condition which Buyer believes constitutes a
material breach of any representation or warranty of Kaiser contained in this
Master Agreement, or which could reasonably be expected to have a Material
Adverse Effect on the Business.
ARTICLE 6
COVENANTS RELATING TO PERSONNEL ARRANGEMENTS
6.1 Transferee Employees. Effective as of the Closing Date, Sellers shall
terminate the employment of the Employees of the Business (including persons
hired following the execution and delivery of this Master Agreement pursuant to
Section 7.1), other than the employees of the Transferred Subsidiaries, and
Buyer or one of its Subsidiaries shall offer employment to all employees whose
employment is so terminated effective as of the time of their termination of
employment with Sellers, including all employees who are not actively at work on
the Closing Date due to short-term disability, layoff, military service or other
authorized leave of absence. In addition, Buyer shall offer employment to all
Employees of the Business who on the Closing Date are absent from work due to a
long-term disability and who notify Buyer within twelve months of the Closing
Date that they have recovered from such long-term disability. All such employees
who accept Buyer's offer of employment and all employees of Transferred
Subsidiaries shall be referred to herein as "Transferee Employees." Buyer or its
Subsidiaries shall hire Transferee Employees other than employees covered by a
collective bargaining agreement at levels of direct cash compensation (excluding
employee and fringe benefits) not lower than their current level of direct cash
compensation with Sellers. Except as otherwise provided herein, Sellers shall be
responsible for (by payment or accrual on the Closing Financial Statements)
wages, salaries and benefits (including vacations) of employees until they
become Transferee Employees.
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6.2 Severance Obligations. Following the Closing Date, full-time and
benefit-eligible part-time (i.e., employees whose scheduled work hours are 30 or
more per week) Employees of the Business who are not offered employment by Buyer
as required in Section 6.1 shall receive severance and accrued vacation
benefits, if any, under the Welfare Plan, Benefit Arrangements and Retention
Arrangements of Sellers, and Buyer shall reimburse Sellers for the payment of
any such amounts which may be due. Notwithstanding anything contained in the
prior sentence to the contrary, Buyer shall have no such payment obligations to
any Employee of the Business who is in good faith offered employment by Buyer
and does not accept such employment, and Sellers will be solely responsible for
obligations, if any, for such benefits, including Retention Arrangements, for
any Employees of the Business who for any reason do not become Transferee
Employees after receiving a good faith offer of employment from Buyer. Buyer
shall be solely responsible for the payment of Retention Arrangements to the
extent reflected on the Closing Financial Statements. Sellers shall be solely
responsible for any obligation for severance pay for Employees of the Business
who become Transferee Employees, including severance pay to any Transferee
Employee who asserts that either the termination of employment by a Seller and
subsequent employment by Buyer or one of its subsidiaries or the transfer of
ownership of a Transferred Subsidiary to Buyer constitutes a termination of
employment which entitles him to severance pay. In the case of any Transferee
Employee whose employment is based in the United States and is terminated by
Buyer, Buyer will make severance payments in accordance with Buyer's severance
policies. Buyer acknowledges that it has not informed Sellers of any planned or
contemplated decisions or actions by Buyer or one of its subsidiaries that would
require service of notice under the WARN Act. Buyer agrees that neither it nor
any of its subsidiaries will take any action which will cause the notice
provision of the WARN Act to become applicable to the Contemplated Transactions.
6.3 COBRA Obligations. Buyer will be solely responsible for any
obligations for continuation coverage under Section 4980B of the Tax Code and
part 6 of Subtitle B of Title I of ERISA with respect to Transferee Employees.
6.4 Plans, Benefits and Policies.
(a) Except as otherwise provided herein, Buyer and its Subsidiaries
will, as of the Closing Date, adopt and provide for Transferee Employees
whose employment is based in the United States employment and benefit plans
and programs (including, to the extent applicable, profit sharing and
retirement plans, medical and severance benefits) on terms and conditions
consistent with Buyer's employment and benefit plans and programs
maintained for similarly situated employees of Buyer.
(b) Buyer and its Subsidiaries will credit Transferee Employees with
service with Sellers (and predecessors of Sellers) for purposes of (i)
vesting for and eligibility to participate in any Pension Plan, but not for
purposes of benefit accruals; (ii) any waiting periods, eligibility or pre-
existing condition limitations for any Welfare Plan; and (iii) eligibility
and benefit computation for vacation and severance pay plans; provided,
--------
however, that with respect to vacation plans for the remainder of calendar
-------
year 2000 only, Buyer shall maintain vacation plans equivalent to, and in
lieu of, Sellers' vacation plans covering the Transferee Employees
immediately prior to the Closing Date (offset by vacation time used under
Sellers' vacation plans as of the Closing Date). Buyer shall
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credit Transferee Employees with any amounts paid prior to the Closing Date
under any Welfare Plan that is a health plan toward the satisfaction of
deductible amounts and copayment minimums under the Buyer's corresponding
welfare benefit plans.
(c) Sellers shall take all necessary actions to vest all Transferee
Employees in their benefits under any Pension Plan maintained by a Seller
(other than the Transferred Subsidiaries) as of the Closing Date. Sellers
have not made contributions to their Pension Plans with respect to the
years 1999 and 2000.
(d) Sellers shall not take any action that will cause Buyer to be or
become a successor corporation with respect to any Pension Plan maintained
by a Seller as of the Closing Date.
(e) Sellers shall take all necessary actions to cause a distributable
event under Section 401(k)(10) of the Tax Code with respect to Employees of
the Business who participate in a Pension Plan of the Sellers that permits
contributions under Section 401(k) of the Tax Code.
(f) Except as otherwise provided herein, as of the Closing Date all
Transferee Employees whose employment is based in the United States shall
cease participation in Benefit Plans of Sellers.
(g) Sellers and/or the applicable U.S. Benefit Plans or other employee
benefit programs sponsored or administered by Sellers shall be responsible
for benefits accrued or claims incurred prior to the Closing (including
expenses incurred post-Closing on a claim incurred prior to Closing) with
respect to Transferee Employees and their eligible dependents in accordance
with the provisions of the applicable Seller's employee benefit program
with respect to: (i) disability benefits, both long-term and short-term,
for disabilities that commenced before the Closing Date; (ii) benefits for
confinements covered under Seller's medical plans that commenced before the
Closing Date; (iii) health care benefits for services rendered or materials
received under Seller's medical plans before the Closing Date; and (iv)
worker's compensation benefits for disabilities resulting from an accident
or occurrence while employed by Seller or a Subsidiary of Seller or a
predecessor thereof which occurred prior to the Closing Date.
(h) After Closing, Buyer and Sellers will cooperate with each other
and provide each other such information as is required concerning
Transferee Employees in order to determine whether a Transferee Employee is
entitled to compensation from either party or benefits under any plan,
program or arrangement sponsored or maintained by either party.
(i) No provision in this Article 6 or Section 2.3(d) shall create any
third-party beneficiary rights in any employee or former employee
(including any beneficiary or dependent thereof) of Buyer, Kaiser, any
Seller or any of their Affiliates.
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6.5 Foreign Employees. As of the Closing Date, Buyer shall cause the
Transferred Subsidiaries to continue to provide the Non-U.S. Employee Benefit
Plans for Transferee Employees whose employment is based outside the U.S.,
subject to the right of Buyer and its Subsidiaries to amend or terminate such
benefit plans on a basis consistent with the terms and conditions of Buyer's
employment and benefit plans from time to time.
6.6 Bonuses. Sellers and Buyer agree that U.S. based Employees of the
Business who become Transferee Employees shall participate in Buyer's applicable
bonus programs as of the Closing Date. Buyer shall be liable for bonuses
accruing prior to the Closing Date to the extent of the aggregate accrual amount
identified on the Closing Financial Statements. Kaiser shall schedule such bonus
accrual on the Closing Financial Statements, identifying each employee entitled
to a bonus and the bonus accrual for such employee.
ARTICLE 7
COVENANTS OF SELLERS
7.1 Conduct of Business.
(a) Except as set forth on Schedule 7.1 or as may be otherwise
expressly permitted by this Master Agreement or with the prior written
consent of Buyer, and subject to any order of the Bankruptcy Court which
shall take precedence over any provision of this Master Agreement, from the
date hereof and prior to the Closing, Kaiser will, and will cause each
Seller to: (i) operate the Business only in the Ordinary Course; (ii) use
commercially reasonable efforts to preserve intact the organization of the
Business; (iii) continue in full force and effect all existing insurance
policies (or comparable insurance) of or relating to the Business; and (iv)
use commercially reasonable efforts to preserve each Seller's relationships
with its suppliers, customers, licensors and licensees and others having
business dealings with any Seller relating to the Business.
(b) Without limiting the generality of Section 7.1(a), and except as
may be otherwise expressly permitted by this Master Agreement or ordered by
the Bankruptcy Court or with the prior written consent of Buyer, which
shall not be unreasonably withheld, delayed or conditioned, from the date
hereof through the Closing, Kaiser shall not permit any Seller, with
respect to the Business, to:
(i) enter into any material transaction in connection with the
Business outside the Ordinary Course.
(ii) conduct the Business in a manner that departs materially
from the manner in which the Business was being conducted prior to the
date of this Master Agreement;
(iii) sell, lease, transfer, mortgage or assign any of the
Transferred Assets, tangible or intangible, other than in the Ordinary
Course;
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(iv) cancel, compromise, knowingly waive or lease any material
right or claim (or series of related rights and claims) under Material
Contracts, outside the Ordinary Course;
(v) make any change in the rate of compensation, commission,
bonus or other direct or indirect remuneration payable, or agree to
pay, conditionally or otherwise, any material bonus, incentive,
retention or other compensation, retirement, welfare, fringe or
severance benefit or vacation pay, to or in respect of any Employee of
the Business, other than the increases and payments in the Ordinary
Course in compensation payable to Employees of the Business and any
Retention Arrangements;
(vi) except for the elimination of intercompany transactions
contemplated by this Master Agreement, cause or permit any Transferred
Subsidiary to declare, pay or distribute any dividend, bonus or other
distribution of profits, or any return or distribution of capital, to
its shareholders and will return or caused to be returned any such
payment or distribution to such Transferred Subsidiary;
(vii) terminate any Employee of the Business whose annual cash
compensation exceeds U.S. $75,000;
(viii) induce any of the Employees of the Business to leave the
employ of Sellers;
(ix) hire any Employee of the Business with annual cash
compensation exceeding U.S. $75,000; and
(x) agree to do any of the foregoing.
(c) In the event that any of Sellers wishes to engage in any act which
falls within the provisions of Section 7.1(b), such Seller shall provide
notice thereof to Buyer who shall advise such Seller within three business
days of any objection Buyer has with such action. In the event that Buyer
fails to object within such period, Buyer shall be deemed to have waived
any objection to such act.
(d) Notwithstanding anything to the contrary contained herein, (i) at
any time prior to the Closing, Sellers may cause any asset of a Transferred
Subsidiary that would not be included in the Transferred Assets if the
assets, rather than the stock, of such Transferred Subsidiary were being
conveyed hereunder, to be transferred to Kaiser or one or more of its
Subsidiaries, and (ii) prior to the Closing, Kaiser shall remove from the
books of each Transferred Subsidiary any intercompany receivable or
intercompany payable, so that at and after the Closing no Transferred
Subsidiary shall owe, or have the right to receive from, Kaiser or any of
its other Subsidiaries (other than a Transferred Subsidiary) any amount for
goods, services or cash advanced or other extensions of credit provided
prior to the Closing. Sellers shall not remove any asset from a
Transferred Subsidiary which is reflected on the Closing Financial
Statements. If an Australian
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Transferred Subsidiary has a Subsidiary incorporated in the Philippines,
then on or before Closing Kaiser shall cause the Australian Transferred
Subsidiary to transfer all of the capital stock of that Filipino Subsidiary
owned beneficially and of record by that Australian Transferred Subsidiary
to Kaiser or a Kaiser Subsidiary which is not a Transferred Subsidiary.
(e) Between the ending date of the Closing Financial Statements and
the Closing, Kaiser (i) shall apply cash received in payment of accounts
receivable of the Business to the payment of Liabilities of the Business in
the Ordinary Course of the Business consistent with prior periods in types
and amounts and (ii) shall not engage in any intercompany transaction which
is prohibited by Section 7.1.
7.2 Use of Business Names by Buyer.
(a) Buyer acknowledges that Sellers have asserted the absolute and
exclusive proprietary right to all names, marks, trade names, trademarks,
service names and service marks (collectively, "Names") incorporating
"Kaiser" or "Kaiser Engineers" or any similar Name and to all corporate
symbols or logos (collectively, "Logos") incorporating "Kaiser" or "Kaiser
Engineers" or any similar Name. All rights of Sellers and its Affiliates
to the same and the goodwill represented thereby and pertaining thereto are
being retained by Sellers. Buyer agrees that it will not, and will cause
the Business not to, use the Kaiser or Kaiser Engineers Name or any similar
Name or any Logo incorporating such Name or any similar Name in any manner,
including in connection with the sale of any products or services or
otherwise in the conduct of the Business, except as expressly permitted by
subsection (b) of this Section 7.2.
(b) Buyer shall not use in any manner the Kaiser and Kaiser Engineers
Names and the Kaiser and Kaiser Engineers Logos incorporating such Names
except to the extent provided pursuant to the Kaiser Trademark License
Agreement. At all times following the Closing, Buyer shall not indicate
that Buyer or the Business is affiliated with any Seller or any of its
Affiliates.
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7.3 Access. Subject to reasonable notice and as permitted by law,
each Seller shall afford to Buyer and its accountants, counsel and other agents
and representatives full access during normal business hours throughout the
period prior to the Closing Date to all of the properties, books, contracts,
commitments and records of the Business and, during such period, each Seller
shall furnish promptly to Buyer and its representatives in relation to the
Business access to all other information concerning the business, properties and
personnel of the Business as Buyer may reasonably request. Each Seller shall
promptly upon request provide Buyer access to a true, complete and correct copy
of each written agreement or other instrument, together with all amendments or
clarifications thereto, and a true, complete and correct summary of the terms
and conditions of each oral agreement, identified in the Disclosure Schedule. If
access is restricted due to a term in the agreement or by Applicable Law, each
Seller shall use its commercially reasonable efforts to secure consent from the
other party(ies) to the agreement to provide such access prior to Closing with
sufficient time for Buyer review. Buyer will treat the documents and other
material and information referred to in this Section 7.3 as confidential in
compliance with Section 9.10.
7.4 Acquisition Proposals. Kaiser specifically agrees that neither
Sellers nor any representative acting on their behalf nor any Affiliate of
Kaiser shall solicit any offer from any third party with respect to the
disposition of all or a substantial part of the assets of the Business unless
required by the Bankruptcy Court or unless Kaiser receives an opinion from
nationally recognized bankruptcy counsel to the effect that Kaiser and Sellers
have a fiduciary duty to take such action.
ARTICLE 8
COVENANTS OF BUYER
8.1 Investigation. In conducting its review of the Business, Buyer
shall conduct itself so as not to interfere unreasonably with the Business or
with the performance of any Seller's employees.
8.2 Intentionally Omitted.
8.3 Buyer Cooperation.
(a) Buyer shall, and shall cause its Affiliates to, provide
transition support to Xxxxxx'x Nova Hut project, primarily from Pittsburgh,
on arms' length terms as provided for in the Transition Services Agreement,
and meet, at their own expense, with interested parties, including without
limitation Nova Hut a.s. and the International Finance Corporation to
confirm this support. In consideration of this support, Buyer and Kaiser
will split, or cause to be split, the fees, if any, payable to Xxxxxx
Netherlands, B.V., its successors or assigns upon final acceptance of the
Nova Hut project, with an amount equal to 20% of the "net fee" (e.g., net
of payment to project employees) payable to Buyer and 80% being retained by
Xxxxxx Netherlands, B.V., its successors or assigns. Notwithstanding
anything herein to the contrary, Kaiser will retain the right to decide, in
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its sole discretion, to negotiate changes to, and cease performing on, the
Nova Hut contract at any time without liability to Buyer or its Affiliates
(other than as provided in the Transition Services Agreement). For the
avoidance of doubt, this provision only relates to the division of the
success fees and does not relate to the cash collateral or retentions.
Kaiser will cause any transferee of the capital stock of Xxxxxx
Netherlands, B.V. to assume Xxxxxx'x obligations under this Section 8.3(a).
(b) (i) With respect to the Worsley project in Australia, following
the payment of any fees (A) due to Xxxxxx'x Australian Transferred
Subsidiaries in connection with the Worsley project reflected as
receivables in the Closing Financial Statements and (B) for ongoing
services provided by Xxxxxx'x Australian Transferred Subsidiaries in
connection with the completion of the Worsley project, Buyer will pay to
Kaiser an amount equal to 70% of the net amount of disputed fees (net of
direct costs expended in connection with the pursuit of such fees), if any,
received by Kaiser Engineers Pty. Ltd. (or its successors and assigns) on
or after the Closing Date. For the avoidance of doubt, following the
Closing neither Kaiser nor any of its Subsidiaries immediately following
the Closing shall bear any downside risk with respect to the Worsley
project.
(ii)(A) Following the Closing Date, Buyer will cause Kaiser
Engineers Pty Ltd., its successors and assigns to consult with Kaiser on a
regular basis concerning such disputed fees.
(B) In the event that Buyer considers that a resolution with
respect to such disputed fees may be achievable, Buyer shall use its
commercially reasonable efforts to cause Kaiser to receive information and
updates with a view to establishing with Kaiser an approved range of
settlement options and obtaining the consent of Kaiser thereto.
(C) In the event that Kaiser is unwilling or unable to
consent to settlement options or to a settlement or resolution with respect
to such fees which is satisfactory to Buyer, Buyer may proceed to settle or
resolve the matter provided that Buyer does not receive any consideration
or other financial benefit as a result of such settlement or resolution
other than its portion of the payment on account of the disputed fees and a
release of claims arising out of the Worsley project. In the event that a
proposed resolution includes any other consideration or financial benefit,
full details thereof shall be provided to Kaiser, and Buyer shall not enter
into any such resolution without the consent of Kaiser, which consent shall
not be unreasonably withheld, delayed or conditioned, it being not
unreasonable for Kaiser to require Buyer to account for and pay to Kaiser,
Xxxxxx'x 70% share of all such consideration or benefits.
(D) In the event that Kaiser does not consent, then the
parties agree to submit their dispute to an independent arbitrator to be
selected in accordance with the rules of the American Arbitration
Association, and the arbitration shall occur in New York City. For the
avoidance of doubt, the provisions in Sections 9.4 and 9.12 of this Master
Agreement which survive the Closing will apply to the arbitration. The
losing party shall pay all reasonable costs and expenses of the
arbitration.
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ARTICLE 9
COVENANTS OF BOTH PARTIES
9.1 Commercially Reasonable Efforts. Subject to the terms and conditions
of this Master Agreement, each party will use its commercially reasonable
efforts to take, or cause to be taken, all actions and to do, or cause to be
done, all things necessary or desirable under Applicable Law and the terms of
this Master Agreement to consummate the Contemplated Transactions, including the
execution and delivery of any further instruments or documents which are
reasonably requested by a party or its counsel to any party signatory hereto in
order to evidence or facilitate the consummation of the Contemplated
Transactions.
9.2 Other Filings. Buyer and Sellers shall cooperate with one another (i)
in determining whether any other action by or in respect of, or filing with, any
Governmental Authority is required, or any actions, consents, approvals or
waivers are required to be obtained from parties to any Material Contracts, in
connection with the consummation of the Contemplated Transactions and (ii) in
taking such actions or making any such filings, in furnishing such information
as may be required in connection therewith, and in seeking timely to obtain any
such actions, consents, approvals or waivers.
9.3 Public Announcements. None of Buyer, the Sellers nor any of their
Affiliates will issue any press release or make any public statement with
respect to this Master Agreement or the Contemplated Transactions, or disclose
the existence of this Master Agreement to any Person or entity, prior to the
Closing and, after the Closing, will not issue any such press release or make
any such public statement without the prior consent of the other party (which
consent shall not be unreasonably withheld or delayed), subject to any
applicable disclosure obligations pursuant to Applicable Law (including Xxxxxx'x
and Buyer's requirement to issue a press release promptly after the execution of
this Master Agreement, Xxxxxx'x obligation to file a Form 8-K with the U.S.
Securities and Exchange Commission, and disclosures required in connection with
the Bankruptcy Case), provided that the party proposing to issue any press
release or similar public announcement or communication in compliance with any
such disclosure obligations shall use commercially reasonable efforts to consult
in good faith with the other party before doing so. In addition, Sellers may
inform their employees of the Contemplated Transactions, and Sellers may
continue to communicate with persons potentially interested in acquiring all or
part of the Business.
9.4 Consents; Cooperation. Kaiser and Buyer will use their commercially
reasonable efforts, and Kaiser will cause the other Sellers to use their
commercially reasonable efforts:
(a) to obtain prior to the earlier of the date required (if so
required) or the Closing Date, all authorizations, consents, orders,
permits or approvals of, or notices to, or filings, registrations or
qualifications with, all Governmental Authorities (including, without
limitation, the approval of the Bankruptcy Court) and any other Person or
entity
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that are required on their respective parts, for the consummation of the
Contemplated Transactions;
(b) to defend, consistent with applicable principles and requirements
of law, any lawsuit or other legal proceeding, whether judicial or
administrative, whether brought derivatively or on behalf of third Persons
(including Governmental Authorities) challenging this Master Agreement or
the Contemplated Transactions;
(c) to furnish to each other such information and assistance as may
reasonably be requested in connection with the foregoing, including without
limitation, the negotiation of the final versions of the Ancillary
Agreements;
(d) to reasonably assist each other as necessary with regard to the
determination of contract or order closeouts or other issues which affect
the Assumed Contracts, to notify Buyer of additional disallowances or
potential adverse audit findings, and to consult and reach agreement with
respect to advanced coordination of negotiating positions, offers of
compromise, or final agreements or settlements, all such cooperation to be
without charge to both parties to this Master Agreement; and
(e) to enter into mutually acceptable arrangements pursuant to which
any payments recovered by Sellers following the Closing Date in respect of
receivables arising under the Assumed Contracts following the Closing Date
are promptly remitted to Buyer.
9.5 Communications with Customers and Suppliers. Kaiser and Buyer will
mutually agree upon all communications with suppliers and customers of the
Business relating to this Master Agreement and the Contemplated
Transactions prior to the Closing Date.
9.6 Liability for Transfer Taxes.
(a) Buyer shall be responsible for and pay in a timely manner all
sales, use, value added, documentary, stamp, gross receipts, registration,
transfer, conveyance, excise, recording, license and other similar Taxes
and fees (including without limitation any goods and services tax, but, for
the avoidance of doubt, exclusive of any Income Taxes) ("Transfer Taxes")
arising out of or in connection with or attributable to the Contemplated
Transactions. Each party hereto shall prepare and timely file all Tax
Returns required to be filed in respect of Transfer Taxes that are the
primary responsibility of such party under Applicable Law, provided,
--------
however, that such party's preparation of any such Tax Returns shall be
-------
subject to the other party's approval which approval shall not be
unreasonably withheld, conditioned or delayed. Notwithstanding anything to
the contrary herein, Buyer shall not be responsible for the payment of any
Transfer Taxes to the extent an order of the Bankruptcy Court rules that
there is an exemption therefrom under Section 1146(c) of the Bankruptcy
Code.
(b) The Transferred Assets are composed of (i) assets as to which the
"isolated, casual or occasional sale" exemption or similar exemption from
Transfer Taxes is or may be applicable and (ii) other assets as to which
other exemptions from Transfer
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Taxes are or may be applicable. In order to obtain any exemption or
favorable tax rate, Buyer shall, to the extent consistent with Applicable
Law, provide Sellers with any exemption or resale certificate, permit,
license or such other documentation as may be required by any taxing
authority to establish the right to such exemption or tax rate.
9.7 Books and Records. Subject to the confidentiality provisions hereof,
Kaiser shall have the right to retain copies of the Books and Records. From and
after the Closing and until the sixth anniversary thereof, (a) each Seller
agrees to grant to Buyer, upon reasonable notice and during normal business
hours, reasonable access to any books and records that pertain to the Business,
but which are not Books and Records, to the extent it is operating and has books
and records in its possession, and Buyer may make copies, at Buyer's expense,
and (b) Buyer agrees to grant to Kaiser or its estate, upon reasonable notice
and during normal business hours, reasonable access to any Books and Records
included in the Transferred Assets that pertain to the operations of the
Business on or prior to the Closing Date. Each of Sellers shall provide Buyer
not less than 45 days' notice prior to the destruction of any books and records
that pertain to the Business or the date when it intends to terminate operations
and Buyer shall have the right to have such records copied, at its cost, prior
to destruction.
9.8 Tax Matters.
9.8.1 Tax Returns.
(a) Kaiser shall be the sole and exclusive agent of the Transferred
Subsidiaries in any and all matters relating to the U.S. federal income tax
liability of the consolidated group of which Kaiser is the common parent
(the "Seller Consolidated Group") for all consolidated return years.
Kaiser shall, inter alia, have the right with respect to any federal
consolidated returns which it files (i) to determine (x) the manner in
which such returns shall be prepared and filed, including, without
limitation, the manner in which any item of income, gain, loss, deduction
or credit shall be reported, (y) whether any extensions of the due dates
for filing of such returns or of the applicable statutes of limitations may
be requested and (z) the elections that will be made by any member of
Seller Consolidated Group, (ii) to file and prosecute any claim for refund,
and (iii) to determine whether any refunds, to which Seller Consolidated
Group may be entitled, shall be paid by way of refund or credited against
the tax liability of Seller Consolidated Group. Prior to the Closing,
Kaiser will cause the Transferred Subsidiaries to irrevocably appoint
Kaiser as agent and attorney-in-fact to take such action (including the
execution of documents) as Kaiser may xxxx appropriate to effect the
foregoing.
(b) Kaiser shall file or cause to be filed when due all Tax Returns
in respect of Taxes not related to the Transferred Subsidiaries for taxable
years or periods ending on or before the Closing Date and shall pay or
cause to be paid the Taxes shown to be due on any such Return.
(c) Buyer shall be responsible for filing all Tax Returns relating
to the Transferred Subsidiaries following the Closing Date, whether or not
they relate to taxable years or periods ending on or prior to the Closing
Date.
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(d) Buyer shall file or cause to be filed when due all Tax Returns
in respect of Taxes not related to the Transferred Subsidiaries for taxable
years or periods ending after the Closing Date and shall pay or cause to be
paid the Taxes shown to be due on any such Tax Return.
(e) Buyer shall have the sole right, at its sole expense and for its
sole benefit, to prepare and file any amended Tax Return, or claim for
refund, and to prosecute any claim for refund, with respect to any Taxes
paid or payable by the Transferred Subsidiaries with respect to periods
ending before, on or after the Closing Date.
9.8.2 Tax Liability. Whenever it is necessary for purposes of this Master
Agreement to determine the Tax Liability of the Transferred Subsidiaries or
Taxes related to the Business for a taxable year or period that ends on or after
the Closing Date, the determination shall be made by assuming that the entity
had a taxable year that ended at the close of the day prior to the Closing Date
and by using the accounting practices and procedures previously used by Kaiser
or the Transferred Subsidiaries, as the case may be, in preparing its Tax
Returns, provided that (a) exemptions, allowances or deductions that are
--------
calculated on an annual basis, such as the deduction for depreciation, shall be
apportioned on a time basis, (b) Taxes (other than income taxes) that are
determined based upon specific transactions (including but not limited to value
added, sales, and use Taxes) shall be allocated in accordance with the timing of
such specific transactions, and (c) responsibility for real estate, personal
property, license, franchise, doing business, and similar Taxes (but not
including any Taxes based on income) shall be pro rated as of the Closing Date
based on the fiscal tax year to which such Taxes relate as set forth on the day
prior to the Closing Financial Statements.
9.8.3 Cooperation.
(a) Kaiser and Buyer shall provide each other with such
assistance and documents, without charge and in a timely fashion, as may be
reasonably requested by either of them in connection with (i) the
preparation of any Tax Return, (ii) the conduct of any procedure relating
to Taxes, or (iii) any other matter that is the subject of this Master
Agreement. Such assistance shall include, without limitation: (i) the
provision on demand of books, records, Tax Returns, documentation or other
information relating to any relevant Tax Return ("Tax Data"); (ii) the
execution of any document that may be necessary or reasonably helpful in
connection with the filing of any Tax Return, or in connection with any
procedure relating to Taxes, including, without limitation, the execution
of powers of attorney and extensions of applicable statutes of limitations;
and (iii) the use of reasonable efforts to obtain any documentation from
any Governmental Authority or other Person that may be necessary or
reasonably helpful in connection with the foregoing. Such cooperation shall
include, without limitation, making their respective employees and
independent auditors reasonably available on a mutually convenient basis
for all reasonable purposes, including, without limitation, to provide
explanations and background information and to permit the copying of books,
records, schedules, workpapers, notices, revenue agent reports, settlement
or closing agreements and other documents containing the Tax Data ("Tax
Documentation"). If a third party is retained in connection with any review
hereunder, the party retaining such third party shall be responsible for
any fees and expenses for such third party.
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(b) Kaiser and each other member of Seller Consolidated Group, and
Buyer and the Transferred Subsidiaries, shall retain or cause to be
retained the Tax Data, the Tax Documentation, all Tax Returns, schedules
and workpapers, and all material records or other documents relating
thereto, until one year after the expiration of all applicable statutes of
limitations (including any waivers or extension thereof) with respect to
the Taxable periods to which such Tax Returns and other documents relate or
until the expiration of any additional period that either Buyer or Seller,
as the case may be, may reasonably request in writing with respect to
specifically designated material records or documents; provided, however,
-------- -------
that in the event an audit, examination, investigation or other proceeding
has been instituted prior to the expiration date of an applicable statute
of limitations, the Tax Data and Tax Documentation relating thereto shall
be retained until there is a final determination thereof (and the time for
any appeal has expired). After the expiration of the time when the Tax
Data and the Tax Documentation must be retained pursuant to this Section
9.8.3(b), then any such material may be destroyed. Kaiser shall give Buyer
not less than thirty (30) days prior written notice before Tax Data or Tax
Documentation in the possession or control of any member of the Seller
Consolidated Group is destroyed and shall give Buyer an opportunity to copy
any such material during such thirty (30) day period. Buyer shall give
Kaiser not less than thirty (30) days prior written notice before any Tax
Data or Tax Documentation in the possession or control of Buyer or any
Transferred Subsidiary is destroyed and shall give Kaiser an opportunity to
copy any such material during such thirty (30) day period.
9.9 Tax Elections. Kaiser shall make no material new elections with
respect to Taxes, or any material changes in current elections with respect to
Taxes, affecting the Transferred Assets or the Transferred Subsidiaries for
periods from and after the Closing Date after the date of this Master Agreement
without the prior written consent of Buyer.
9.10 Confidentiality.
(a) Between the date of this Master Agreement and the Closing Date,
Buyer and Sellers will maintain in confidence, and will cause their
respective directors, officers, employees, agents and advisors to maintain
in confidence, and not use to the detriment of another party, Sellers or
the Transferred Subsidiaries any written, oral, or other information
obtained in confidence from another party, Sellers or the Transferred
Subsidiaries in connection with this Master Agreement or the Contemplated
Transactions, unless (i) such information is already known to such party or
to others not bound by a duty of confidentiality or such information
becomes publicly available through no fault of such party, (ii) the use of
such information is necessary or appropriate in making any filing or
obtaining any consent or approval required for the consummation of the
Contemplated Transactions, or (iii) the furnishing or use of such
information is required by legal proceedings; provided, however, that the
-------- -------
party required to disclose the confidential information pursuant to Section
9.10(a)(iii) shall first notify the other party of such order and afford
the other party the opportunity to seek a protective order relating to such
disclosure.
(b) If the Contemplated Transactions are not consummated, each party
will immediately return or destroy all such confidential information and
any and all copies
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thereof, however stored, and, if requested by the other
party, shall certify conformity with this Section 9.10(b) in writing.
(c) Following the Closing, Sellers shall not, and shall cause their
officers, directors, employees and agents not to, disclose any confidential
information specific to the Business to any third party, except as required
under the Transition Services Agreement.
9.11 Ancillary Agreements. Following the Closing Date, Kaiser and Buyer
will perform, or cause to be performed, their respective obligations under the
Ancillary Agreements.
9.12 Assistance. Following the Closing Date, upon request of any party,
the other party will use its commercially reasonable efforts to assist such
party in connection with collection of accounts receivable related to the
Transferred Assets or the Excluded Assets as the case may be. To the extent a
party receives payments that belong to the other party, such party shall
promptly pay such amounts to the appropriate party. Neither party shall
compromise any accounts receivable or other payments due to the other party
without the prior written consent of the other party.
9.13 Notice. Between the date of this Agreement and Closing, Buyer and
Sellers shall promptly notify the other party of any fact, circumstance or
condition which such party believes constitutes a material breach of any
representation or warranty of Kaiser contained in this Master Agreement, or
which could reasonably be expected to have a Material Adverse Effect on the
Business.
ARTICLE 10
BUYER PROTECTIONS: OVERBIDDING PROCEDURES AND
BREAK-UP FEES
10.1 Bankruptcy Court Approvals. As promptly as practicable, Sellers
subject to Bankruptcy Court approval shall file with the Bankruptcy Court and
serve motions seeking: (i) a hearing (the "Interim Hearing") before the
Bankruptcy Court for an order (A) approving, among other things, the adequacy of
notice to creditors and parties in interest of the final hearing to approve the
sale of the Transferred Assets and the assumption of the Assumed Liabilities
(the "Sale Hearing"), and (B) setting a date for the Sale Hearing (the "Interim
Order"); and (ii) an order authorizing, among other things, (A) Sellers to sell
the Transferred Assets to Buyer pursuant to this Master Agreement and Sections
363 and 365 of the Bankruptcy Code, free and clear of all encumbrances
(including without limitation any and all "interests" in the Transferred Assets
within the meaning of Bankruptcy Code Section 363(f), except for the Assumed
Liabilities, and (B) Buyer to assume the Assumed Liabilities and Sellers to be
relieved of liability therefrom (the "Sale Order").
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10.2 Obtaining the Orders. Sellers shall use their commercially reasonable
efforts to obtain the Interim Order and the Sale Order as soon as practicable.
The Interim Order and the Sale Order shall be in form and substance reasonably
satisfactory to the Buyer.
10.3 Overbidding Procedures and Break-Up Fee. Sellers and Buyer agree that
the overbidding procedures allowing for the payment of a Break-Up Fee shall be
as follows:
(a) No competing bid will be accepted or approved by the Sellers
unless it is made pursuant to terms substantially similar to those
contained in this Master Agreement (a "Competing Bid") and provides for
aggregate consideration having a value equal to at least the sum of (A) the
Purchase Price plus (B) the Break-up Fee, if any is required to be paid on
account of the Competing Bid, plus (C) One Hundred Thousand Dollars
($100,000);
(b) Any bidder making a Competing Bid (a "Competing Bidder") shall
be required to deliver to the Sellers an executed copy of an agreement
substantially similar to this Master Agreement (the "Competing Bid
Agreement") on or before three (3) calendar days before the date scheduled
by the Bankruptcy Court for the Sale Hearing, together with evidence of the
Competing Bidder's financial ability to consummate the Competing Bid
Agreement; and the Competing Bidder shall be required to submit to the
Sellers on or before the date scheduled by the Bankruptcy Court for the
Sale Hearing, a cashier's check drawn to the order of the Sellers in an
amount equal to five percent (5%) of the purchase price set forth in the
Competing Bid (the "Competing Bid Deposit") (or a letter of credit in such
amount in a form reasonably satisfactory to Kaiser from a commercial bank
in the United States) . If one or more Competing Bid Agreements are
submitted, an auction shall be held at the office of the Sellers' counsel,
000 Xxxxxxxx Xxxxxx, Xxxxx 0000, Xxxxxxxxxx, XX 00000. At the auction,
Buyer and all parties who have submitted conforming Competing Bid
Agreements shall have the opportunity to submit additional higher and
better bids (each successive Competing Bid Agreement shall be in increments
of not less than $100,000 in each successive round of bidding). At the Sale
Hearing, Sellers will determine the highest and best bid and will request
the Bankruptcy Court to confirm Sellers' determination of the prevailing
Competing Bidder; if so determined, the prevailing Competing Bidder shall
execute and deliver at the Sale Hearing, to the extent not delivered
already, a signed instrument of irrevocable agreement with terms
substantially similar to those described in this Master Agreement.
(c) If the closing under an agreement is not timely concluded with a
successful Competing Bidder, Sellers shall be authorized without further
Bankruptcy Court approval or orders promptly to conclude the Contemplated
Transactions with the next highest willing bidder at the Sale Hearing in
accordance with the terms of such next highest winning bidder's bid
(assuming such bid otherwise complies with this Master Agreement).
(d) Subject to approval of the Bankruptcy Court and the closing of
the Contemplated Transactions by an accepted Competing Bid, if a Competing
Bid is approved by order of the Bankruptcy Court, Buyer shall be paid a
break-up fee of three percent (3%) of the Purchase Price (the "Break-Up
Fee"), and shall have its Deposit
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refunded; provided, however, notwithstanding anything to the contrary
-------- -------
herein, no such Break-Up Fee shall be paid to Buyer if (i) the Buyer has
terminated, withdrawn or abandoned this Master Agreement for any reason
other than pursuant to Section 13.1(c)(i) or (ii) Sellers have, prior to
the issuance of such order of the Bankruptcy Court, terminated this Master
Agreement pursuant to Section 13.1(c)(ii), except that the Deposit shall be
returned to Buyer if Buyer terminates this Master Agreement pursuant to
Section 13.1(c)(i).
(e) Subject to Section 10.3(f), the Buyer shall be entitled to
payment of the Break-Up Fee (and the Deposit) if the Sellers materially
breach their obligations to proceed with the Contemplated Transactions for
any reason, and Buyer terminates this Master Agreement pursuant to Section
13.1(c).
(f) Payment of the Break-Up Fee and a refund of the Deposit shall
(i) be full consideration for Buyer's efforts and expenses in connection
with the bidding process, this Master Agreement and the Contemplated
Transactions, including the due diligence efforts of Buyer and its
professionals and advisors and (ii) constitute liquidated and agreed
damages in respect of this Master Agreement and the Contemplated
Transactions, and Sellers shall have no further liability to the Buyer.
Buyer believes that it is impossible to determine accurately the amount of
all damages that it would incur by virtue of a breach by Sellers of their
obligations to proceed with the Contemplated Transactions, and its sole and
exclusive remedy for any such breach shall be to receive payment of the
Break-Up Fee (and a refund of the Deposit). Except as provided in this
Section 10.3 and Section 13.3, Buyer shall have no right nor remedy against
any Seller, at law or in equity, by reason of a breach by any Seller of its
obligation to proceed with the Contemplated Transactions.
(g) Sellers shall obtain an order from the Bankruptcy Court that
provides that the Break-Up Fee shall constitute a first priority
administrative expense of the Sellers pursuant to Section 503(b) of the
Bankruptcy Code and shall be paid upon the earlier of (i) the closing of
the Contemplated Transactions by an accepted Competing Bid and (ii) the
entry of any order of the Bankruptcy Court directing payment by Sellers of
such amounts.
(i) Sellers reserve the right to alter, amend and/or revise the
bidding procedures as they deem appropriate.
ARTICLE 11
CONDITIONS TO OBLIGATIONS OF BUYER TO CLOSE
The obligations of Buyer to purchase the Business and the Transferred
Assets and otherwise consummate the transactions that are to be consummated at
the Closing are subject to the satisfaction, as of the Closing Date, of the
following conditions (any of which may be waived by Buyer, in its sole
discretion, in whole or in part):
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11.1 Accuracy of Representations and Warranties. The representations and
warranties of Kaiser set forth in Article 4 and the Ancillary Agreements shall
be accurate in all material respects as of the Closing, as though made on and as
of the Closing Date, except to the extent that (a) any of the representations
and warranties in Sections 4.1 through 4.22 (for greater certainty excluding the
first paragraph of Article 4) refers specifically to a date other than the
Closing Date, in which case such representation or warranty shall have been
accurate in all material respects as of such other date, and (b) the accuracy of
any of such representations and warranties is affected by any of the
Contemplated Transactions, provided that this Section 11.1 shall not entitle
Buyer to refuse to close the Contemplated Transactions unless the inaccuracies
of the representations and warranties set forth in Article 4 give rise, or would
reasonably be expected to give rise, to Condition-Triggering Losses.
11.2 Performance. Kaiser shall have, and shall have caused each Seller to
have, performed in all material respects all obligations required by this Master
Agreement to be performed by Kaiser or any Seller on or before the Closing Date,
including without limitation Xxxxxx'x obligations pursuant to Section 3.6(a) and
the last sentence of Section 7.1(d) (Filipino shares), except where the failure
to perform such obligations did not and would not reasonably be expected to
result in Condition-Triggering Losses.
11.3 No Conflict. The Contemplated Transactions and the consummation of the
Closing shall not be illegal or prohibited under any Applicable Law. No
temporary restraining order, preliminary or permanent injunction, cease and
desist order or other order issued by any court of competent jurisdiction or any
competent Governmental Authority or any other legal restraint or prohibition
preventing the transfers contemplated hereby (including without limitation the
transfer of the capital stock of the Transferred Subsidiaries) or the
consummation of the Closing, or imposing Condition-Triggering Losses in respect
thereto, shall be in effect, and there shall be no pending or threatened actions
or proceedings by any Governmental Authority (or determinations by any
Governmental Authority) that result, or would reasonably be expected to result,
in Condition-Triggering Losses.
11.4 Certificate. Buyer shall have received from a duly authorized officer
of each Seller a certificate dated the Closing Date confirming, to such person's
knowledge, that the conditions in Sections 11.1, 11.2 and 11.3 have been met.
Such officer shall be one of the persons whose knowledge comprises Sellers'
Knowledge.
11.5 Bankruptcy Court Approval. The Bankruptcy Court shall have entered the
Sale Order, in form and substance reasonably satisfactory to Buyer, and the
implementation, operation or effect of such order shall not be stayed or any
stay entered shall have been dissolved, and the Bankruptcy Court shall not have
entered any order which would result, or would reasonably be expected to result,
in Condition-Triggering Losses.
11.6 Intentionally Omitted.
11.7 Consents. All approvals, consents, waivers and authorizations required
to be obtained by any Seller in connection with the Contemplated Transactions
that are identified on Schedule 11.7 shall have been obtained and shall be in
full force and effect, except where the
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failure to obtain such consents did not and would not reasonably be expected to
result in Condition-Triggering Losses.
11.8 Transfer Documents. Kaiser shall, and shall have caused each other
Seller to, have delivered to Buyer at the Closing all documents, certificates
and agreements necessary to transfer to Buyer all of Seller's right and title to
and interests in the Transferred Assets, including, without limitation:
(a) bills of sale, assignments and general conveyances, in form and
substance reasonably satisfactory to Buyer, dated the Closing Date, with
respect to the Transferred Assets other than Transferred Assets owned by
the Transferred Subsidiaries;
(b) certificates representing the outstanding shares of capital
stock of the Transferred Subsidiaries accompanied by duly executed stock
powers in form and substance reasonably satisfactory to Buyer;
(c) assignments of all Assumed Contracts and any other agreements
and instruments constituting Transferred Assets (other than such
Transferred Assets owned by the Transferred Subsidiaries) in form and
substance reasonably satisfactory to Buyer, dated the Closing Date,
assigning to Buyer all of each Sellers' right, title and interest therein
and thereto; and
(d) certificates of title to all owned motor vehicles, if any,
included in the Transferred Assets to be transferred to Buyer hereunder
(other than the Transferred Assets owned by the Transferred Subsidiaries)
in form and substance reasonably satisfactory to Buyer, duly endorsed for
transfer to Buyer as of the Closing Date.
11.9 Transaction Documents. Buyer and Kaiser shall have entered into the
Ancillary Agreements and other Transaction Documents.
11.10 Resignations. Sellers shall have delivered to Buyer the resignations
of the directors and officers of the Transferred Subsidiaries.
11.11 Corporate Records. Sellers shall deliver to Buyer the minute books
and corporate records of the Transferred Subsidiaries.
11.12 Further Instruments. Sellers shall deliver to buyer such further
instruments of assignment, conveyance or transfer or other documents of further
assurance as Buyer may reasonably request reasonably in advance of the Closing.
ARTICLE 12
CONDITIONS TO OBLIGATIONS OF KAISER TO CLOSE
The obligation of Kaiser to sell the Transferred Assets and otherwise
consummate the transactions that are to be consummated at the Closing is subject
to the satisfaction, as of the
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Closing Date, of the following conditions (any of which may be waived by Kaiser,
in its sole discretion in whole or in part):
12.1 Accuracy of Representations and Warranties. The representations and
warranties of Buyer set forth in Article 5 shall be accurate in all material
respects as of the Closing, as though made on and as of the Closing Date, except
to the extent that (a) any of such representations and warranties refers
specifically to a date other than the Closing Date, in which case such
representation or warranty shall have been accurate in all material respects as
of such other date, or (b) the accuracy of any of such representations and
warranties is affected by any of the Contemplated Transactions.
12.2 Performance. Buyer shall have performed in all material respects all
obligations required by this Master Agreement to be performed by Buyer on or
before the Closing Date except where the failure to perform such obligations did
not and would not reasonably be expected to result in a material adverse effect
on the Contemplated Transactions.
12.3 No Conflict. The Contemplated Transactions and the consummation of the
Closing shall not be illegal or prohibited under any Applicable Law. No
temporary restraining order, preliminary or permanent injunction, cease and
desist order or other order issued by any court of competent jurisdiction or any
competent Governmental Authority or any other legal restraint or prohibition
preventing the transfers contemplated hereby (including without limitation the
transfer of the capital stock of the Transferred Subsidiaries) or the
consummation of the Closing, or imposing damages in respect thereto, shall be in
effect, and there shall be no pending or threatened actions or proceedings by
any Governmental Authority (or determinations by any Governmental Authority)
that would reasonably be expected to have a material adverse effect on the
Contemplated Transactions.
12.4 Certificate. Kaiser shall have received from a duly authorized officer
of Buyer a certificate dated the Closing Date confirming, to such person's
knowledge, that the conditions in Sections 12.1, 12.2 and 12.3 have been met.
12.5 Bankruptcy Court Approval. The Bankruptcy Court shall have entered the
Sale Order, in form and substance reasonably satisfactory to Kaiser, and the
implementation, operation or effect of such order shall not be stayed or any
stay entered shall have been dissolved.
12.6 Intentionally Omitted.
12.7 Consents. All approvals, consents, waivers and authorizations required
to be obtained by Buyer in connection with the Contemplated Transactions that
are identified on Schedule 12.7 shall have been obtained and shall be in full
force and effect, except where the failure to obtain such consents did not and
would not reasonably be expected to have a material adverse effect on the
Contemplated Transactions.
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12.8 Assumption Agreement. Kaiser shall have received from Buyer an
Assumption Agreement, in form and substance reasonably satisfactory to Sellers,
under which Buyer shall have assumed the Assumed Liabilities.
12.9 Transaction Documents. Buyer and Kaiser shall have entered into the
Ancillary Agreements and the other Transaction Documents.
12.10 Further Instruments. Buyer shall deliver to Kaiser such further
instruments of assumption or other documents of further assurance as Sellers may
reasonably request reasonably in advance of the Closing.
12.11 Payment. Kaiser shall have received immediately available funds by
wire transfer in accordance with Section 3.2 hereto.
ARTICLE 13
TERMINATION
13.1 Right to Terminate Agreement. This Master Agreement may be
terminated and the Contemplated Transactions may be abandoned at any time prior
to the Closing (the actual date on which this Master Agreement is terminated
being referred to herein as the "Termination Date"):
(a) by Buyer or Sellers, if the Closing has not occurred on or
before September 30, 2000 (the "Outside Date"), unless such failure to
close is due to the failure of the party seeking to terminate this Master
Agreement to comply fully with its obligations under this Master Agreement;
(b) by mutual written consent of Buyer and Sellers, subject to any
necessary Bankruptcy Court approval;
(c) (i) by Buyer, if any of the conditions in Article 11 has not
been satisfied or if satisfaction of any such condition is or becomes
impossible as of the Outside Date (other than through the failure of Buyer
to comply with Buyer's obligations under this Master Agreement), and Buyer
has not waived such conditions on or before the Outside Date; or
(ii) by Sellers, if any of the conditions in Article 12 has not
been satisfied or if satisfaction of any such condition is or becomes
impossible as of the Outside Date (other than through the failure of
Sellers to comply with Sellers' obligations under this Master Agreement),
and Sellers have not waived such conditions on or before the Outside Date;
(d) automatically, if the Bankruptcy Court shall have entered an
order approving a Competing Bid and the Contemplated Transactions by the
Competing Bid are subsequently consummated; and
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(e) by Buyer, if Buyer is not reasonably satisfied with the results
of its additional due diligence concerning the Worsley project, which due
diligence may include meetings with representatives of Alcoa, Billiton
and/or Bechtel, together with Kaiser representatives.
13.2 Effect of Termination. Upon the termination of this Master Agreement
pursuant to Section 13.1:
(a) Buyer shall promptly cause to be returned to Kaiser all
documents and information obtained in connection with this Master Agreement
and the Contemplated Transactions and all documents and information
obtained in connection with Buyer's investigation of the Business,
including any copies made by or supplied to Buyer or any of Buyer's agents
of any such documents or information; and
(b) All rights and obligations of the parties hereunder shall
terminate without any liability of any party to the other party except for
(i) any liability of any party for a breach prior to termination, including
the remedy provided for in Section 13.4, (ii) the rights, if any, the Buyer
may have under Section 13.3, and (iii) the confidentiality provisions
contained in Section 9.10 and the Confidentiality Agreement entered into
prior to this Master Agreement, which shall survive termination.
13.3 Buyer's Remedies. The Buyer's exclusive remedy for any breach or
termination of this Master Agreement prior to Closing shall be the rights to
liquidated damages provided for in Article 10 of this Master Agreement,
including the return of the Deposit to the extent provided for therein.
13.4 Sellers' Remedies. The Sellers' exclusive remedy for any breach or
termination of this Master Agreement prior to Closing shall be the Deposit,
being released to Sellers from the Sellers' segregated account if the following
conditions are met. Sellers shall be entitled to such liquidated damages if
Buyer fails to close the transaction proposed by this Master Agreement and both
of the following are true: (a) Buyer has not properly terminated this Master
Agreement in accordance with Section 13.1 hereof, and (b) all of Buyer's
conditions to Closing have been met or Sellers are willing and able to meet such
conditions which have not yet been fulfilled.
13.5 Deposit Interest. Interest accrued on the cash Deposit shall belong
and be paid to the party which receives or retains the cash Deposit.
ARTICLE 14
MISCELLANEOUS
14.1 Expiration of Representations, Warranties and Covenants. The
representations, warranties and, except as expressly provided herein to the
contrary, the covenants set forth in this Master Agreement shall terminate and
expire, and shall cease to be of any force or effect, on the Closing Date; all
liability of the parties hereto with respect to such representations, warranties
and covenants shall thereupon be extinguished; and BUYER
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ACKNOWLEDGES THAT IT HAS HAD SUFFICIENT OPPORTUNITY TO MAKE WHATEVER
INVESTIGATION MAY BE NECESSARY AND ADVISABLE FOR PURPOSES OF DETERMINING WHETHER
OR NOT TO ENTER INTO AND CLOSE THIS MASTER AGREEMENT. For the avoidance of
doubt, the covenants provided for in Article 6, Section 8.3, Sections 9.2, 9.3,
9.4, 9.9, 9.10, 9.11 and 9.12 shall continue without expiration or limit, the
covenants provided for in Sections 9.6 and 9.8 shall continue until the first
anniversary of the statute of limitations with respect to the statutes governing
the applicable Taxes and the covenant provided for in Section 9.7 shall continue
until the sixth anniversary of the Closing; provided however that nothing in
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this sentence shall prevent Kaiser and/or any of its Subsidiaries from
consummating a complete liquidation.
14.2 Material Adverse Effect. Any adverse change, event or effect that is
proximately caused by conditions affecting the United States or international
economy generally shall not be taken into account in determining whether there
has been or would be a Material Adverse Effect on the Business or a Material
Adverse Effect on Buyer (unless such conditions adversely affect Sellers or
Buyer, as the case may be, in a materially disproportionate manner). Any adverse
change, event or effect that is proximately caused by any industry in which
Buyer or Sellers competes shall not be taken into account in determining whether
there has been or would be a Material Adverse Effect on Buyer or Material
Adverse Effect on the Business (unless such conditions adversely affect Sellers
or Buyer, as the case may be, in a materially disproportionate manner). Any
adverse change, event or effect that is proximately caused by the announcement
or pendency of the sale of the Business and the Transferred Assets shall not be
taken into account in determining whether there has been or would be a Material
Adverse Effect on Buyer or a Material Adverse Effect on the Business. Any
adverse change, event or effect that is proximately caused by any breach by
Buyer or Sellers of any covenant or obligation set forth in this Master
Agreement shall not be taken into account in determining whether there has been
or would be a Material Adverse Effect on the Business or Material Adverse Effect
on Buyer, respectively.
14.3 Disclaimer of Projections, Etc. Sellers make no representation or
warranty to Buyer except as specifically made in this Master Agreement and the
Ancillary Agreements. In particular, Sellers make no representation or warranty
to Buyer with respect to the contents of Seller descriptive materials and
management presentations to Buyer or the data room made available to Buyer,
including the certainty or accuracy of any financial projection or forecast
delivered by or on behalf of any Seller to Buyer. Buyer acknowledges that (a)
there are uncertainties inherent in attempting to make such projections and
forecasts, (b) it is familiar with such uncertainties, (c) it is taking full
responsibility for making its own evaluation of the adequacy and accuracy of all
such projections and forecasts so furnished to it, and (d) it shall have no
claim against Sellers with respect thereto.
ARTICLE 15
AGREEMENT CONVENTIONS
15.1 Further Assurances. Each party agrees, at any time and from time to
time after the Closing Date, upon reasonable request from the other party, to
do, execute, acknowledge and
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deliver, as appropriate, such further acts, deeds, assignments, transfers,
conveyances, assumptions, and powers of attorney as may reasonably be required
for (a) the better assigning, transferring, granting, conveying, assuming,
assuring and confirming to such other party, or its successors and assigns, of
any of the assets, properties or liabilities to be assigned to it, or (b) the
reassignment or return to Sellers of assets that may have been inadvertently
assigned, transferred or delivered to Buyer but should not have been so
assigned, transferred or delivered, in each case as provided in the Transaction
Documents.
15.2 Notices. All notices, requests, demands, waivers and other
communications required or permitted to be given under the Transaction Documents
shall be in writing and shall be deemed to have been duly given if (a) delivered
personally, (b) mailed by first-class, registered or certified mail, return
receipt requested, postage prepaid, (c) sent by next-day or overnight mail or
courier or (d) sent by facsimile transmission. All such notices, requests,
demands, waivers and other communication shall be deemed to have been received
(i) if by personal delivery, upon delivery, (ii) if by certified or registered
mail, on the third business day after the mailing thereof, (iii) if by next-day
or overnight mail or courier, on the day after such mailing, (iv) if by
facsimile, three hours after the sender receives a fax confirmation, unless the
fax is sent after 5:00 p.m. on a business day or on a non-business day, in which
case it shall be deemed received on the next business day.
If to Buyer:
Hatch Associates, Inc.
0000 Xxxxxxxx Xxxxx
Xxxxxxx, Xxx Xxxx 00000-0000
Attention: Secretary
Tel: (000) 000-0000
Fax: (000) 000-0000
with a copy to:
Phillips, Lytle, Xxxxxxxxx, Xxxxxx & Xxxxx LLP
0000 XXXX Xxxxxx
Xxxxxxx, XX 00000
Attention: Xxxxxxxxx X. Xxxxx
Tel: (000) 000-0000
Fax: (000) 000-0000
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If to Kaiser or Sellers, to:
Xxxxxx Group International, Inc.
0000 Xxx Xxxxxxx
Xxxxxxx, XX 00000-0000
Attention: Office of General Counsel
Tel: (000) 000-0000
Fax: (000) 000-0000
with a copy to:
Squire, Xxxxxxx & Xxxxxxx L.L.P.
0000 Xxx Xxxxx
000 Xxxxxx Xxxxxx
Xxxxxxxxx, XX 00000-0000
Attention: G. Xxxxxxxxxxx Xxxxx
Tel: (000) 000-0000
Fax: (000) 000-0000
or, in each case, to such other address as may be specified in writing to the
other parties.
Any party may give any notice, instruction or communication in connection
with the Transaction Documents using any other means (including personal
delivery, telecopy or ordinary mail), but no such notice, instruction or
communication shall be deemed to have been delivered unless and until it is
actually received by the party to whom it was sent. Any party may change the
address to which notices, instructions, or communications are to be delivered by
giving the other parties to the Transaction Documents notice thereof in the
manner set forth in this Section 15.2.
15.3 Assignment. This Master Agreement may not be assigned by either party,
provided, however, that Buyer may assign any or all of Buyer's rights and
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delegate any or all of Buyer's duties under this Master Agreement, including
without limitation the right to acquire the shares of the Transferred
Subsidiaries to Hatch Associates Limited, Hatch Associates Pty. Ltd., Hatch
(Australia) Pty. Ltd. or one or more corporations which is a wholly-owned direct
or indirect Subsidiary of Buyer's 100% ultimate parent company, but no
assignment shall relieve Buyer of Buyer's obligations under this Master
Agreement. Subject to the foregoing, this Master Agreement and the rights and
obligations set forth herein shall inure to the benefit of, and be binding upon,
the parties hereto and each of their respective successors, heirs and permitted
assigns.
15.4 Entire Agreement; Amendment; Governing Law; Etc. The Transaction
Documents (together with the Exhibits and Schedules thereto) embody the entire
agreement and understanding among the parties hereto with respect to the subject
matter thereof. The Transaction Documents may be amended, modified, waived,
discharged or terminated only by
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(and any consent hereunder shall be effective only if contained in) an
instrument in writing signed by the party against which enforcement of such
amendment, modification, waiver, discharge, termination or consent is sought.
The Transaction Documents shall be construed in accordance with and governed by
the laws of the State of Delaware as it applies to contracts to be performed
entirely within Delaware.
15.5 Consent to Jurisdiction. THE BANKRUPTCY COURT SHALL HAVE JURISDICTION
OVER ALL MATTERS, INCLUDING, BUT NOT LIMITED TO, ANY LEGAL ACTION, SUIT OR
PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT, ANY RELATED AGREEMENTS,
OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY AND THE INTERPRETATION,
IMPLEMENTATION AND ENFORCEMENT OF THIS AGREEMENT, AND THE PARTIES HERETO
IRREVOCABLY SUBMIT AND CONSENT TO SUCH JURISDICTION.
Each of Buyer and each of the Sellers further agrees that service of any
process, summons, notice or document by U.S. registered mail to such party's
respective address set forth in Section 15.2 of this Master Agreement shall be
effective service of process for any action, suit or proceeding with respect to
any matters to which it has submitted to jurisdiction as set forth above. Each
of Buyer and each of the Sellers irrevocably and unconditionally waives any
objection to the laying of venue of any action, suit or proceeding arising out
of this Agreement in the Bankruptcy Court, and irrevocably and unconditionally
waives and agrees not to plead or claim in any such court that any such action,
suit or proceeding brought in any such court has been brought in an inconvenient
forum. In the event that a court should find that subject matter jurisdiction
is not available in the Bankruptcy Court, Buyer and Sellers hereby agree to
submit any and all disputes arising out of this Agreement to the jurisdiction
and venue of the U.S. District Court for the District of Delaware.
15.6 Severability. Any term or provision of the Transaction Documents that
is invalid or unenforceable in any jurisdiction, as to such jurisdiction, shall
be ineffective to the extent of such invalidity or unenforceability, without
rendering invalid or unenforceable the remaining terms and provisions of the
Transaction Documents or affecting the validity or enforceability of any of the
terms or provisions of the Transaction Documents in any other jurisdiction.
15.7 Reliance on Counsel and Other Advisors. Each party has consulted such
legal, financial, technical or other experts as it deems necessary or desirable
before entering into the Transaction Documents. Each party represents and
warrants that it has read, knows, understands and agrees with the terms and
conditions of the Transaction Documents.
15.8 Exhibits and Schedules. Each of the Exhibits and Schedules referred to
in the Transaction Documents and attached thereto is an integral part of the
Transaction Documents and is incorporated in the respective Transaction
Documents by this reference.
15.9 Rules of Construction. Unless the context otherwise requires: (a) a
term has the meaning assigned to it; (b) an accounting term not otherwise
defined has the meaning assigned to it in accordance with U.S. GAAP; (c)
references in the singular or to "him," "her," "it," "itself," or other like
references, and references in the plural or the feminine or masculine reference,
as
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the case may be, shall also, when the context so requires, be deemed to include
the plural or singular, or the masculine or feminine reference, as the case may
be; (d) the use of the word "including" shall mean including, without
limitation, with regard to the items listed thereafter; (e) provisions apply to
successive events and transactions; (f) references to Articles, Sections,
Schedules and Exhibits in a Transaction Document shall refer to Articles,
Sections, Schedules and Exhibits of that Transaction Document, unless otherwise
specified; (g) the headings in the Transaction Documents are for convenience and
identification only and are not intended to describe, interpret, define or limit
the scope, extent, or intent of the respective Transaction Documents or any
provision thereof; (h) the Transaction Documents shall be construed without
regard to any presumption or other rule requiring construction against the party
that drafted and caused the Transaction Documents to be drafted; (i) the use of
the term "specific" in relation to a subject means relating exclusively to that
subject; (j) references to "commercially reasonable efforts" in the Transaction
Documents shall require the efforts that a prudent person desirous of achieving
a commercially reasonable result would use in similar circumstances to achieve a
result within a commercially reasonable time; and (k) all references to
"dollars" or "$" shall mean United States Dollars.
15.10 Counterparts. The Transaction Documents may be executed in several
counterparts, each of which shall be an original, but all of which shall
constitute one instrument.
15.11 No Third Party Rights. This Agreement is not intended to create
third-party beneficiary rights or remedies in other Persons not parties hereto.
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IN WITNESS WHEREOF, the parties hereto have duly caused this Master
Agreement to be executed as of the date first above written.
HATCH ASSOCIATES, INC.
By: /s/ Burto Xxxxxxx /s/ Xxxx X. Xxxxxxx
-------------------------------------------
Name: Burto Xxxxxxx Xxxx X. Xxxxxxx
-------------------------------------
Title: Director Managing Director,
------------------------------------
Corporate Services
------------------------------------
XXXXXX GROUP INTERNATIONAL, INC.
By: /s/ Xxxxxxx X. X'Xxxxxx
-------------------------------------------
Name: Xxxxxxx X. X'Xxxxxx
-------------------------------------
Title: Chief Financial Officer
-------------------------------------
Each of the following Sellers own the shares of capital stock
identified as owned by it on Schedule 4.3 of this Master Agreement, and agrees
to transfer them to Buyer in accordance with and subject to the terms of this
Master Agreement.
XXXXXX ENGINEERS, INC.
By: /s/ Xxxxxxx X. Xxxxxxx, Xx.
-------------------------------------------
Name: Xxxxxxx X. Xxxxxxx, Xx.
-------------------------------------
Title: President
-------------------------------------
XXXXXX ENGINEERS AND
CONSTRUCTORS, INC.
By: /s/ Xxxxxxx X. Xxxxxxx, Xx.
-------------------------------------------
Name: Xxxxxxx X. Xxxxxxx, Xx.
-------------------------------------
Title: President
-------------------------------------
XXXXXX ENGINEERS INTERNATIONAL, INC.
By: /s/ Xxxxxxx X. Xxxxxxx, Xx.
-------------------------------------------
Name: Xxxxxxx X. Xxxxxxx, Xx.
-------------------------------------
Title: President
-------------------------------------
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