Execution Copy
Exhibit 2.1
PURCHASE AGREEMENT
BY AND AMONG
GENERAL ELECTRIC COMPANY, THROUGH ITS
GE TRANSPORTATION SYSTEMS BUSINESS
AND RELATED ENTITIES
AND
WESTINGHOUSE AIR BRAKE
TECHNOLOGIES CORPORATION
AND RELATED ENTITIES
DATED JULY 24, 2001
TABLE OF CONTENTS
Page
ARTICLE I. DEFINITIONS...........................................................................................1
Section 1.1 Terms Not Defined Elsewhere...........................................................1
Section 1.2 Cross References to Defined Terms.....................................................7
ARTICLE II. PURCHASE AND SALE....................................................................................9
Section 2.1 Agreement to Purchase and Sell........................................................9
Section 2.2 Excluded Assets......................................................................11
Section 2.3 Non-Assignable Contracts.............................................................11
Section 2.4 Assumption of Certain Liabilities....................................................12
Section 2.5 Liabilities Not Assumed..............................................................12
Section 2.6 Acquired Subsidiary Liabilities......................................................13
ARTICLE III. PURCHASE PRICE; ADJUSTMENTS; ALLOCATIONS...........................................................14
Section 3.1 Consideration........................................................................14
Section 3.2 Post-Closing Adjustment..............................................................14
Section 3.3 Purchase Price Allocation............................................................16
ARTICLE IV. REPRESENTATIONS AND WARRANTIES OF SELLERS...........................................................16
Section 4.1 Organization.........................................................................16
Section 4.2 Capitalization of the Acquired Subsidiaries..........................................16
Section 4.3 Authorization........................................................................17
Section 4.4 Absence of Restrictions and Conflicts................................................17
Section 4.5 Real Property........................................................................18
Section 4.6 Title to and Sufficiency of Assets...................................................19
Section 4.7 Financial Statements.................................................................19
Section 4.8 Absence of Certain Changes...........................................................20
Section 4.9 Legal Proceedings....................................................................20
Section 4.10 Compliance with Law..................................................................21
Section 4.11 Material Contracts...................................................................21
Section 4.12 Insurance Policies...................................................................23
Section 4.13 Environmental, Health and Safety Matters.............................................23
Section 4.14 Intellectual Property; Software......................................................25
Section 4.15 Transactions with Affiliates.........................................................26
Section 4.16 Inventory; Accounts Receivable; Accounts Payable.....................................27
Section 4.17 Licenses and Permits.................................................................27
Section 4.18 Ethical Practices....................................................................27
Section 4.19 Brokers, Finders and Investment Bankers..............................................28
Section 4.20 Products; Warranties.................................................................28
Section 4.21 Copies of Documents..................................................................28
ARTICLE V. REPRESENTATIONS AND WARRANTIES OF BUYERS.............................................................29
Section 5.1 Organization.........................................................................29
Section 5.2 Authorization........................................................................29
Section 5.3 Absence of Restrictions and Conflicts................................................29
Section 5.4 Brokers, Finders and Investment Bankers..............................................29
ARTICLE VI. CERTAIN COVENANTS AND AGREEMENTS....................................................................30
Section 6.1 Conduct of Business by the Seller Parties............................................30
Section 6.2 Inspection and Access to Information; Confidential Information.......................33
Section 6.3 Notices of Certain Events............................................................34
Section 6.4 Interim Financial Statements.........................................................34
Section 6.5 No Solicitation of Transactions......................................................34
Section 6.6 Reasonable Efforts; Further Assurances; Cooperation..................................35
Section 6.7 Public Announcements.................................................................36
Section 6.8 Insurance............................................................................36
Section 6.9 Non-Competition; Non-Solicitation....................................................36
Section 6.10 Trademarks, Tradenames and Other Intellectual Property Matters.......................39
Section 6.11 Risk of Loss.........................................................................40
Section 6.12 Transitional Services................................................................41
Section 6.13 IP Development and License Agreement.................................................41
Section 6.14 Environmental Matters................................................................41
Section 6.15 St. Louis Business...................................................................43
Section 6.16 Xxxxxxxx Lease.......................................................................44
Section 6.17 Overlapping Agreements...............................................................44
Section 6.18 Files and Records....................................................................44
ARTICLE VII. EMPLOYEE MATTERS...................................................................................44
Section 7.1 Officers and Employees...............................................................44
Section 7.2 Employee Benefit Plans...............................................................45
Section 7.3 Labor Relations......................................................................46
Section 7.4 Transferred Employees................................................................48
Section 7.5 Sellers' Employee Benefit Plans......................................................49
Section 7.6 Buyers' Benefit Plans................................................................50
Section 7.7 WARN Act.............................................................................50
ARTICLE VIII. TAXES.............................................................................................51
Section 8.1 Representations and Warranties Regarding Taxes.......................................51
Section 8.2 Tax Cooperation; Allocation of Taxes.................................................51
Section 8.3 Acquired Subsidiary Tax Returns......................................................52
Section 8.4 CFC Reporting Requirements...........................................................52
ARTICLE IX. CLOSING.............................................................................................52
Section 9.1 The Closing..........................................................................52
Section 9.2 Deliveries by Seller Parties.........................................................53
Section 9.3 Deliveries by Buyers.................................................................54
ARTICLE X. CONDITIONS PRECEDENT TO CLOSING OBLIGATIONS..........................................................55
Section 10.1 Conditions to Each Party's Obligations...............................................55
Section 10.2 Conditions to Obligations of Buyers..................................................55
Section 10.3 Conditions to Obligations of the Seller Parties......................................56
ARTICLE XI. TERMINATION.........................................................................................57
Section 11.1 Termination..........................................................................57
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Section 11.2 Specific Performance and Other Remedies..............................................58
Section 11.3 Effect of Termination................................................................58
ARTICLE XII. INDEMNIFICATION....................................................................................58
Section 12.1 Termination of Certain Representations and Warranties................................58
Section 12.2 Indemnification Obligations of Sellers...............................................59
Section 12.3 Indemnification Obligations of Buyers................................................59
Section 12.4 Indemnification Procedure............................................................60
Section 12.5 Claims Period........................................................................61
Section 12.6 Liability Limitsg....................................................................62
Section 12.7 Investigations.......................................................................63
Section 12.8 Exclusive Remedy.....................................................................63
ARTICLE XIII. MISCELLANEOUS PROVISIONS..........................................................................63
Section 13.1 Notices..............................................................................63
Section 13.2 Schedules and Exhibits...............................................................65
Section 13.3 Assignment; Successors in Interest; Amendment........................................65
Section 13.4 Number; Gender.......................................................................65
Section 13.5 Captions.............................................................................65
Section 13.6 Jurisdiction, Venue and Applicable Law...............................................65
Section 13.7 Severability.........................................................................65
Section 13.8 Counterparts.........................................................................66
Section 13.9 No Third Party Beneficiaries.........................................................66
Section 13.10 Waiver...............................................................................66
Section 13.11 Integration..........................................................................66
Section 13.12 Compliance with Bulk Sales Laws......................................................66
Section 13.13 Cooperation Following the Closing....................................................67
Section 13.14 Transaction Costs....................................................................67
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PURCHASE AGREEMENT
THIS PURCHASE AGREEMENT (this "Agreement"), dated as of July 24, 2001,
is made and entered into by and among General Electric Company, a New York
corporation, through its GE Transportation Systems business, or its nominee
("GETS"), GE Mexico S.A. de C.V., a corporation organized under the laws of
Mexico, or its nominee ("GE Mexico"), Westinghouse Air Brake Technologies
Corporation, a Delaware corporation ("Wabtec"), each of the Affiliates (as
defined below) of Wabtec set forth on SCHEDULE A, and each Acquired Subsidiary
(as defined below). (GETS and GE Mexico are sometimes referred to herein
individually as "Buyer" and collectively as "Buyers;" Wabtec and the Affiliates
of Wabtec set forth on SCHEDULE A are sometimes referred to herein individually
as "Seller" and collectively as "Sellers;" Sellers and the Acquired Subsidiaries
are sometimes referred to herein individually as a "Seller Party" and
collectively as the "Seller Parties;" and all such entities are sometimes
referred to herein individually as a "Party" and collectively as the "Parties.")
A. Among the businesses conducted by the Seller Parties is the
business described on ANNEX A (the "Business").
B. Buyers desire to acquire from Sellers, and Sellers desire to
transfer to Buyers, certain assets and liabilities of Sellers, including all of
the outstanding shares of capital stock of the Acquired Subsidiaries (the
"Acquired Subsidiary Shares"), on the terms and subject to the conditions set
forth in this Agreement (the "Acquisition").
C. The Parties desire to make certain representations, warranties
and agreements in connection with the Acquisition.
NOW, THEREFORE, in consideration of the foregoing and the respective
representations, warranties, covenants, agreements and conditions hereinafter
set forth, and intending to be legally bound hereby, the Parties agree as
follows:
ARTICLE I.
DEFINITIONS
Section 1.1 TERMS NOT DEFINED ELSEWHERE. The following terms, as used
herein, have the following meanings:
"ACQUIRED SUBSIDIARY" means each Person listed on SCHEDULE B.
"ACQUISITION PROPOSAL" means any proposal with respect to a
merger, consolidation, share exchange, tender offer, exchange offer,
business combination or similar transaction involving the Business, or
any purchase or other acquisition of all or any significant portion of
the assets included in the Business which, in either case, could
reasonably be viewed as being inconsistent with, preventing or
materially delaying the performance by the Seller Parties of any of
their obligations under this Agreement or the consummation of the
transactions contemplated hereby.
"ADA" means the Americans with Disabilities Act.
"ADEA" means the Age Discrimination in Employment Act.
"AFFILIATE" means, with respect to any Person, any other
Person directly or indirectly controlling, controlled by, or under
common control with such other Person. For purposes of this definition,
"control," "controlled" and "controlling" when used with respect to any
specified Person means the power to direct the management and policies
of such Person, directly or indirectly, whether through the ownership
of voting securities, by contract or otherwise.
"ANTITRUST ACTS" means the Xxxx-Xxxxx-Xxxxxx Antitrust
Improvements Act of 1976, as amended, and any equivalent Applicable Law
of Mexico.
"APPLICABLE LAW" means all U.S., Mexican or other foreign,
federal, provincial, state or local laws (including, without
limitation, common law), statutes, treaties, judicial decisions,
regulations, rules, judgments, orders, decrees, injunctions and
agreements with any Governmental Entity.
"BENCHMARK NET WORTH" means an amount equal to the difference
between: (i) the sum of the amounts shown on the balance sheets of each
Division of the Business as of June 30, 2001 (when delivered pursuant
to Section 6.4) under the heading "Assets" and (ii) the sum of the
amounts shown on such balance sheets under the heading "Liabilities."
In addition to accounting adjustments, each balance sheet will include
the following adjustments: "Assets" will be calculated disregarding (A)
any Excluded Assets listed on the applicable balance sheet (including,
without limitation, any accounts receivable from any Wabtec Group
Member or any other inter-company receivables); (B) any inventory
listed on the applicable balance sheet that was purchased from any
Wabtec Group Member business other than the Business; and (C) any other
items listed on the applicable balance sheet but not transferred to
Buyer and (D) any intangible assets that are amortized; "Liabilities"
will be calculated disregarding any liabilities of the Seller Parties
listed on the applicable balance sheet that are not Assumed Liabilities
(including, without limitation, any accounts payable to any Wabtec
Group Member or any other inter-company payables) or are Retained
Subsidiary Liabilities.
"BUSINESS FACILITIES" means the facilities of the Business
that have been visited by representatives of Buyers located at: Mexico
City, Mexico (limited to the sales office and the Xxxxx de Mexico
service shop); Acambaro, Mexico; San Xxxx Potosi, Mexico (excluding the
Wabtec Service Center and the Young Touchstone manufacturing building);
Emporium, Pennsylvania; St. Louis, Missouri (excluding real property
and buildings); Latham, New York; Elk Grove Village, Illinois; and
Barstow, California.
"CERCLA" means the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, as amended, and any rules or
regulations promulgated thereunder.
"CLOSING DATE NET WORTH" means the amount equal to the
difference between: (i) the sum of the amounts shown on each Closing
Date Balance Sheet
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under the heading "Assets" and (ii) the sum of the amounts shown on
each Closing Date Balance Sheet under the heading "Liabilities,"
calculated in a manner consistent with the calculation of the Benchmark
Net Worth, including, without limitation, the adjustments described in
the definition of Benchmark Net Worth.
"CODE" means the Internal Revenue Code of 1986, as amended.
"CONFIDENTIAL INFORMATION" means any data or information of
the Business, other than Trade Secrets, which is valuable to the
operation of the Business and not generally known to the public.
"DIVISION OF THE BUSINESS" means each of "MPI Noreste,"
"Wabtec Distribution," "Wabtec Engine Systems Company" and "Motor Coils
Manufacturing."
"EMPLOYEE BENEFIT PLAN" means with respect to any Person, each
plan, fund, program, agreement, arrangement or scheme, including, but
not limited to each plan, fund, program, agreement, arrangement or
scheme maintained or required to be maintained under Applicable Law
that is at any time sponsored or maintained or required to be sponsored
or maintained by such Person or to which such Person makes or has made,
or has or has had an obligation to make, contributions providing for
employee benefits or for the remuneration, direct or indirect, of the
employees, former employees, directors, officers, consultants,
independent contractors, contingent workers or leased employees of such
Person or the dependents of any of them (whether written or oral),
including, without limitation: each deferred compensation, bonus,
incentive compensation, stock purchase, stock option and other equity
compensation plan; each "welfare" plan (within the meaning of Section
3(1) of ERISA determined without regard to whether such plan is subject
to ERISA); each "pension" plan (within the meaning of Section 3(2) of
ERISA, determined without regard to whether such plan is subject to
ERISA); and each severance plan or agreement, health, supplemental
unemployment benefit, hospitalization insurance, medical, dental, legal
and each other employee benefit plan, fund, program, agreement or
arrangement.
"ENVIRONMENT" means any surface or ground water, drinking
water supply, soil, surface or subsurface strata or medium, and the
ambient air.
"ENVIRONMENTAL LAW" means any and all past, present and future
local, municipal, state, provincial, national or federal law, statute,
decision, judgment, award, regulation, decree, rule, order, consent,
authorization, permit, or similar requirement, approval or standard in
the United States, Mexico or any other jurisdiction concerning
environmental, health or safety matters (including, but not limited to,
the clean-up standards and practices for Hazardous Materials) relating
to buildings, equipment, or the Environment.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended.
"ERISA AFFILIATE" means any Person that, together with any
Seller, would be deemed a "single employer" within the meaning of
Section 414 of the Code.
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"ERISA AFFILIATE PLAN" shall mean each Employee Benefit Plan
sponsored or maintained or required to be sponsored or maintained at
any time by any ERISA Affiliate, or to which such ERISA Affiliate makes
or has made, or has or has had an obligation to make, contributions at
any time.
"EXISTING CONDITION" means the state of repair, condition or
other characteristics of the operations, raw materials, products,
facilities, equipment, properties, sites and any other processes or
items which are or have been used in connection with the Business at or
prior to the Closing.
"FMLA" means the Family and Medical Leave Act.
"FLSA" means the Fair Labor Standards Act.
"GAAP" means generally accepted accounting principles,
consistently applied.
"GOVERNMENTAL ENTITY" means any U.S., Mexican or other
foreign, federal, state, regional, municipal or local governmental or
administrative authority, including any court, tribunal, agency,
bureau, committee, board, commission or instrumentality constituted or
appointed by any such authority.
"HAZARDOUS MATERIALS" mean any waste, pollutant, contaminant,
hazardous substance, toxic, ignitable, reactive or corrosive substance,
hazardous waste, special waste, industrial substance, by-product,
process intermediate product or waste, petroleum or petroleum-derived
substance or waste, chemical liquids or solids, liquid or gaseous
products, or any constituent of any such substance.
"INTELLECTUAL PROPERTY" means (i) all domestic or foreign
patents, patent applications, inventions (whether or not patentable),
processes, technologies, discoveries, copyrightable and copyrighted
works, apparatus, Trade Secrets, trademarks, service marks, trade
names, trade dress, symbols, logos, domain names, design rights,
customer lists, marketing and customer information, mask works rights,
know-how, formulas, licenses, manufacturing data, blueprints, drawings,
technical information (whether confidential or otherwise), software,
systems, databases, models, methodologies, and all other intellectual
property (including any existing instructions or manuals relating
thereto); (ii) all licenses, sublicenses or agreements with respect to
any of the foregoing; and (iii) all filings, registrations and
applications for or issuances of any of the foregoing with or by any
Governmental Entity.
"KNOWLEDGE" means (a) with respect to the Seller Parties, all
facts actually known by the individuals listed on ANNEX B-1 and (b)
with respect to the Buyers, all facts actually known by the individuals
listed on ANNEX B-2.
"LIEN" means, with respect to any property or asset, any
mortgage, lien, pledge, charge, security interest, encumbrance,
restriction, tenancy or other possessory interest, conditional sale or
other title retention agreement, assessment, easement, right of way,
covenant, right of first refusal, defect in title, or any other claim
of any kind in respect of such property or asset. For the purposes of
this Agreement, a Person shall be deemed to
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own a property or asset that is subject to a Lien if it has acquired or
holds such property or asset subject to the interest of a vendor or
lessor under any conditional sale agreement, capital lease or other
title retention agreement relating to such property or asset.
"MATERIAL ADVERSE EFFECT" means, with respect to the Business,
any state of facts, change, event, effect or occurrence that is or may
be reasonably likely to (i) be materially adverse to the business,
financial condition, results of operations, properties, assets or
liabilities (including, without limitation, contingent liabilities) of
the Business, taken as a whole, or (ii) prevent or materially delay the
consummation of the transactions contemplated by this Agreement that,
in either case, causes Buyer Losses, individually or in the aggregate,
in an amount in excess of $25 million. Notwithstanding the above, for
purposes of Section 10.2(d) and Section 11.1(d), Material Adverse
Effect on the Business shall only mean: (x) any breach of any of the
Seller Agreements set forth on SCHEDULE 10.2 that remains uncured
beyond the twenty (20) day period after any Seller Party becomes aware
of such breach, or (y) any state of facts, change, event, effect or
occurrence that causes Buyer Losses, individually or in the aggregate,
in an amount in excess of $25,000,000 and that relates to or arises as
a result of any of the following: any Action, any damage to the
Purchased Assets, any political upheaval or regulatory changes, the
negligent or improper management of the Business by the Seller Parties
or any liability or obligation of Seller not known by or disclosed to
Buyers prior to or as of the date hereof.
"NLRB" means the National Labor Relations Board of the United
States.
"NONCOMPETE PERIOD" shall mean the period beginning on the
Closing Date and ending on the fifth anniversary of the Closing Date.
"OSHA" means the Occupational Safety and Health
Administration.
"PERMITS" means all permits (including, without limitation,
environmental, construction and operation permits), notifications,
licenses, franchises, certificates, approvals, exemptions,
classifications, registrations and other similar documents and
authorizations issued by any Governmental Entity.
"PERMITTED LIENS" means (i) Liens for Taxes not yet due and
payable, (ii) statutory Liens of landlords and Liens of carriers,
warehousemen, mechanics, materialmen and repairmen incurred in the
ordinary course of business consistent with past practice and not yet
delinquent and (iii) zoning, building, or other restrictions,
variances, covenants, rights of way, encumbrances, easements and other
minor irregularities in title; none of which, individually or in the
aggregate, (A) interfere in any material respect with the present use
of or occupancy of the related property or operation of the Business
thereon, (B) have more than an immaterial effect on the value thereof
or its use or (C) would materially impair the ability of such property
to be sold for its present use.
"PERSON" means an individual, corporation, partnership,
limited liability company, association, trust or other entity or
organization, including a Governmental Entity.
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"PRE-CLOSING TAX PERIOD" means (i) any Tax period ending on or
before the Closing Date and (ii) with respect to a Tax period that
commences before but ends after the Closing Date, the portion of such
period up to and including the Closing Date.
"RELATE TO THE BUSINESS," "RELATED TO THE BUSINESS," "RELATING
TO THE BUSINESS" or "IN RELATION TO THE BUSINESS" means primarily used
in, primarily arising from or primarily connected with the Business.
Such terms are deemed to include all assets, properties and operations
of the Acquired Subsidiaries.
"RELEASE" or "RELEASED" means to spill, leak, pump, pour,
emit, empty, discharge, inject, escape, xxxxx, dump or dispose into the
Environment.
"RESTRICTED ACTIVITIES" is defined in ANNEX C.
"SELLER BENEFIT PLAN" means each Employee Benefit Plan in
which any employee of the Business may participate, which is sponsored
or maintained or required to be sponsored or maintained at any time by
any Wabtec Group Member or to which any Wabtec Group Member makes or
has made, or has or has had an obligation to make, contributions at any
time.
"TAX" and "TAXES" means all taxes, assessments, charges,
duties, fees, levies or other governmental charges (including interest,
penalties or additions associated therewith) imposed on the Business,
including income, franchise, capital stock, real property, personal
property, tangible, withholding, employment, payroll, social security,
social contribution, unemployment compensation, disability, transfer,
sales, use, excise, gross receipts, value-added and all other taxes of
any kind relating to the Business for which any Wabtec Group Member may
have any liability imposed by any Governmental Entity, whether disputed
or not, and any charges, interest or penalties imposed by any
Governmental Entity.
"TAX RETURN" means any report, return, declaration or other
information required to be supplied to a Governmental Entity in
connection with Taxes, including estimated returns and reports of every
kind with respect to Taxes.
"TERRITORY" means North America, South America, Australia,
Africa, Europe and Asia; any other area where any customer of the
Business is located as of the Closing Date; and any other area where
any Wabtec Group Member has conducted Restricted Activities prior to or
as of the Closing Date.
"TRADE SECRETS" means information, including, but not limited
to, technical or non-technical data, a formula, pattern, compilation,
program, including, without limitation, computer software and related
source codes, device, method, technique, drawing, process, financial
data, financial plan, product plan, list of actual or potential
customers or suppliers, or other information similar to any of the
foregoing, which derives economic value, actual or potential, from not
being generally known to, and not being readily ascertainable by proper
means by, other persons who can derive economic value from its
disclosure or use.
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"WABTEC GROUP MEMBER" means Wabtec, any of its direct or
indirect subsidiaries, or any parent entity of any of the foregoing.
"WARN ACT" means the United States Worker Adjustment and
Retraining Notification Act.
Section 1.2 CROSS REFERENCES TO DEFINED TERMS. Each of the following
terms has the meaning ascribed to it in the Section of this Agreement set forth
opposite such term:
TERM: DEFINED IN:
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Acquired Subsidiary Assets.....................................................Section 2.1
Acquired Subsidiary Financial Statements.......................................Section 4.7(a)
Acquired Subsidiary Shares.....................................................Recitals
Acquisition....................................................................Recitals
Action.........................................................................Section 4.9
ADA............................................................................Section 7.3(i)
ADEA...........................................................................Section 7.3(i)
Agreement .....................................................................Preamble
Apportioned Obligations........................................................Section 8.2(b)
Assignment and Assumption Agreement............................................Section 9.2(b)
Assumed Collective Bargaining Agreement........................................Section 7.4(a)
Assumed Liabilities............................................................Section 2.4
Xxxxxxxx Lease.................................................................Section 6.16
Business.......................................................................Recitals
Business Balance Sheets........................................................Section 4.7(a)
Business Income Statement......................................................Section 4.7(c)
Buyer(s).......................................................................Preamble
Buyer Ancillary Documents......................................................Section 5.2
Buyer Indemnified Parties......................................................Section 12.2
Buyer Losses...................................................................Section 12.2(f)
Claims Period..................................................................Section 12.5
Closing........................................................................Section 9.1
Closing Date...................................................................Section 9.1
Closing Date Balance Sheets....................................................Section 3.2(b)
Closing Month Inventory........................................................Section 3.2(a)
Closing Statement..............................................................Section 3.2(b)
Components Purchase Agreement..................................................Section 6.9(b)(ii)
Consolidated Financial Statements..............................................Section 4.7(a)
COBRA Coverage.................................................................Section 7.4(b)
Employee Benefit Plans.........................................................Section 7.5
Environmental Consultant.......................................................Section 6.14
Environmental Indemnity Agreement..............................................Section 9.2(m)
Environmental Insurance Policy.................................................Section 6.14(b)
Environmental Reviews..........................................................Section 6.14
Estimated Compliance Costs.....................................................Section 6.14
Estimated Environmental Claims.................................................Section 6.14
Excluded Assets................................................................Section 2.2
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GE Mexico......................................................................Preamble
GETS...........................................................................Preamble
Immaterial Contract............................................................Section 4.11
Indemnified Party..............................................................Section 12.4(a)
Indemnifying Party.............................................................Section 12.4(a)
Independent Accountant.........................................................Section 3.2(b)
Interim Balance Sheets.........................................................Section 4.7(b)
Interim Income Statements......................................................Section 4.7(d)
IP Development and License Agreement...........................................Section 6.13
Labor Laws.....................................................................Section 7.3(q)
Leased Real Property...........................................................Section 4.5(b)
Licenses.......................................................................Section 4.17
March 2001 Balance Sheets......................................................Section 4.7(b)
Material Contract..............................................................Section 4.11
Notice.........................................................................Section 3.2(b)
Non-Assignable Contracts.......................................................Section 2.3
Owned Real Property............................................................Section 2.1(b)
Party(ies).....................................................................Preamble
Post-Closing Tax Period........................................................Section 8.2(b)
Purchase Price.................................................................Section 3.1(b)
Purchased Assets...............................................................Section 2.1
Preceding Month Inventory......................................................Section 3.2(a)
Real Property..................................................................Section 4.5
Receivables....................................................................Section 4.16(a)
Resolution Period..............................................................Section 3.2(b)
Restricted Party(ies)..........................................................Section 6.9(a)
Retained Subsidiary Liabilities................................................Section 2.6
Seller(s)......................................................................Preamble
Seller Agreements..............................................................Section 2.1(h)
Seller Purchased Assets........................................................Section 2.1
Seller Ancillary Documents.....................................................Section 4.3
Seller Indemnified Parties.....................................................Section 12.3
Seller Licensed Software.......................................................Section 4.14(a)
Seller Losses..................................................................Section 12.3
Seller Party(ies)..............................................................Preamble
Seller Proprietary Software....................................................Section 4.14(a)
Seller Software................................................................Section 4.14(a)
Seller Trademarks and Tradenames...............................................Section 6.10
Supply and Marketing Agreement.................................................Section 9.2(r)
Surviving Representations......................................................Section 12.1
St. Louis Assets...............................................................Section 6.15
St. Louis Employees............................................................Section 6.15
Termination Date...............................................................Section 11.1
Threshold Amount...............................................................Section 10.2(a)
Transitional Services..........................................................Section 6.12
Transfer Taxes.................................................................Section 8.2(c)
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Transferred Employees..........................................................Section 7.4(a)
Wabtec.........................................................................Preamble
ARTICLE II.
PURCHASE AND SALE
Section 2.1 AGREEMENT TO PURCHASE AND SELL. Subject to the terms and
conditions of this Agreement and except as otherwise specifically provided in
this Article II and Section 6.15 with respect to the St. Louis Assets, at the
Closing Sellers will grant, sell, assign, transfer and deliver to Buyers, and
Buyers will purchase and acquire from Sellers, free and clear of all Liens other
than Permitted Liens, all right, title and interest of Sellers in and to (x) all
of the Acquired Subsidiaries Shares and (y) all of the assets, properties,
rights (contractual or otherwise) and business of every kind and description,
wherever located, real, personal or mixed, tangible or intangible, owned or
principally used by any Wabtec Group Member in connection with the Business,
including without limitation: (I) those located at any of the Business
Facilities that have not been disposed of in the ordinary course of business
consistent with past practice prior to the Closing Date (all of which shall be
deemed to be owned or principally used in connection with the Business); (II)
those on the March 2001 Balance Sheets that have not been disposed of in the
ordinary course of business consistent with past practice as permitted by this
Agreement; (III) those of the same nature as those shown on the March 2001
Balance Sheets acquired after the date of the March 2001 Balance Sheets; and
(IV) those set forth on a representative basis below:
(a) Machinery, equipment (including, without limitation,
computer hardware), tooling (including, without limitation, tooling located at
supplier sites), parts, furniture, data and telephone equipment supplies, and
other tangible personal property relating principally to the Business,
including, without limitation, those listed on SCHEDULE 2.1(a), which have an
individual original cost in excess of $25,000 (subject to additions thereto and
dispositions thereof in the ordinary course of business consistent with past
practices);
(b) The parcels of real property owned by Sellers, together
with all appurtenant rights, licenses, easements, covenants, privileges,
approvals and qualifications relating thereto and all buildings, structures and
improvements thereon or affixed thereto, including fixtures constituting real
property, listed on SCHEDULE 2.1(b) (the "Owned Real Property");
(c) Raw materials, component parts, production and
non-production supplies, work-in-process and finished goods inventory and other
inventory listed on the Business Balance Sheets, the Interim Balance Sheets and
the Closing Date Balance Sheets, or any such inventory that should be (or should
have been) listed on such balance sheets, including, without limitation, the
inventory as of March 31, 2001 listed on SCHEDULE 2.1(c) (all of which is
subject to additions thereto and dispositions thereof in the ordinary course of
business consistent with past practices);
(d) Permits held by or issued to any Wabtec Group Member
relating principally to the Business (to the extent the same are transferable),
including, without limitation, the Permits listed on SCHEDULE 2.1(d);
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(e) Intellectual Property Relating to the Business (excluding
over-the-counter pre-packaged and accounting software that is not transferable),
including as listed on SCHEDULE 2.1(e);
(f) Leases of equipment, computer hardware, machinery,
vehicles or other tangible personal property relating principally to the
Business to which any Wabtec Group Member is a party, including, without
limitation, those listed on SCHEDULE 2.1(f);
(g) The leases of real property relating, together with all
rights to all buildings, structures and improvements relating thereto, listed on
SCHEDULE 2.1(g) (the "Real Property Leases");
(h) All other contracts, agreements, contract rights, license
agreements, franchise rights and agreements, policies, purchase and sales
orders, quotations and executory commitments, instruments, third party
guaranties, indemnifications, arrangements and understandings, whether oral or
written, relating principally to the Business to which any Wabtec Group Member
is a party (the "Seller Agreements"), including, without limitation, those
listed on SCHEDULE 2.1(h);
(i) Accounts receivable and notes receivable, deposits,
prepaid expenses and other miscellaneous tangible and intangible assets of
Sellers relating principally to the Business, including, without limitation,
those listed on SCHEDULE 2.1(i) (subject to increases or decreases therein in
the ordinary course of business consistent with past practices);
(j) Causes of action, judgments, claims or demands of whatever
kind or description (including, without limitation, those for any past or
present infringement, misappropriation or breach of any rights) against any
Person relating principally to the Business, including, without limitation,
those listed on SCHEDULE 2.1(j), which have an individual value in excess of
$50,000;
(k) Original copies of the charter documents, minute books,
stock ledgers, Tax Returns, books of account and other constituent records
relating to the corporate organization of each Acquired Subsidiary;
(l) Information, files, correspondence, records, data, plans,
reports, contracts and recorded knowledge relating principally to the Business,
including customer, supplier, and price and mailing lists; accounting or other
books and records; and information and records related to the operation and
maintenance of the Purchased Assets, including the Real Property, all in
whatever media retained or stored, including, without limitation, computer
programs and disks; and
(m) Goodwill Relating to the Business.
(Such assets, properties, rights and business (including those owned by the
Acquired Subsidiaries) described in this Section 2.1 are collectively referred
to herein as the "Purchased Assets." The Purchased Assets owned, held or used by
any Acquired Subsidiary are collectively referred to herein as the "Acquired
Subsidiary Assets."
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The Purchased Assets other than the Acquired Subsidiary Assets are
collectively referred to herein as the "Seller Purchased Assets.") The
Seller Parties shall be deemed to have conveyed the Acquired Subsidiary
Assets to Buyers as required by this Section 2.1 through the transfer
by Sellers to Buyers of the Acquired Subsidiary Shares at the Closing
as provided in Article IX.
Section 2.2 EXCLUDED ASSETS. Notwithstanding anything to the contrary
set forth in this Agreement, the Purchased Assets do not include the following
assets (collectively, the "Excluded Assets"):
(a) any cash, cash equivalents or marketable securities and
all rights to any bank accounts;
(b) all ownership and other rights with respect to the Seller
Benefit Plans other than any Assumed Collective Bargaining Agreement;
(c) any Permit that by its terms is not transferable to
Buyers;
(d) any accounts receivable from any Wabtec Group Member or
any other inter-company receivables;
(e) the charter documents, minute books, stock ledgers, Tax
Returns, books of account and other constituent records relating to the
corporate organization of each Seller;
(f) any Purchased Assets sold or otherwise disposed of in the
ordinary course of business and not in breach of any provision of this Agreement
during the period from the date hereof until the Closing;
(g) the rights that accrue to Sellers under this Agreement;
(h) the Seller Parties' interest in the real property and
buildings located at the Boise, Idaho and St. Louis, Missouri facilities, and
any other interest in real property other than that listed on SCHEDULE 2.1(b) or
on SCHEDULE 2.1(g);
(i) any over-the-counter pre-packaged or accounting software
to the extent not transferable under applicable license agreements; and
(j) subject to Section 6.10, the trade names "Motive Power"
and "MPI" and all uses thereof; and
(k) those assets, properties and rights set forth on SCHEDULE
2.2.
Section 2.3 NON-ASSIGNABLE CONTRACTS. To the extent that third party
consents relating to any Seller Agreement have not been obtained by Sellers as
of the Closing, Sellers shall, during the remaining term of such Seller
Agreements (the "Non-Assignable Contracts"), use commercially reasonable efforts
to (a) obtain the consent of the applicable third party, (b) make the benefit of
such Non-Assignable Contracts available to Buyers so long as Buyers fully
cooperate with Sellers and promptly reimburse Sellers for all payments made by
Sellers in connection therewith and indemnify Sellers with respect thereto, and
(c) enforce at the request of Buyers and at the expense and for the account of
Buyers, any rights of Sellers arising from such
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Non-Assignable Contracts against the other party or parties thereto (including
the right to elect or terminate any such Non-Assignable Contract in accordance
with the terms thereof). Sellers will not take any action or suffer any omission
which would limit or restrict or terminate in any material respect the benefits
to Buyers of such Non-Assignable Contracts unless, in good faith and after
consultation with and prior written notice to Buyers, Sellers are ordered orally
or in writing to do so by a Governmental Entity of competent jurisdiction or
Sellers are otherwise required to do so by law; provided that if any such order
is appealable, Sellers will take such actions as are requested by Buyers at the
expense of Buyers to file and pursue such appeal and to obtain a stay of such
order. With respect to any Non-Assignable Contract as to which the necessary
approval or consent for the assignment or transfer to Buyers is obtained
following the Closing, Sellers shall transfer such Non-Assignable Contract to
Buyers by execution and delivery of an instrument of conveyance reasonably
satisfactory to Buyers and Sellers within ten (10) business days following
receipt of such approval or consent. Notwithstanding the foregoing, Sellers
shall not be indemnified to the extent of any losses which result from (i)
Sellers' failure to take any lawful action in accordance with Buyers' reasonable
instructions or (ii) Sellers' gross negligence or willful misconduct.
Section 2.4 ASSUMPTION OF CERTAIN LIABILITIES. Subject to Section 2.5,
Buyers shall assume and agree to pay, discharge or perform, as appropriate, (a)
the liabilities and obligations of the Seller Parties arising under the Material
Contracts and Immaterial Contracts, to the extent such contracts are assigned to
Buyers (or Buyers are provided the benefits thereof) and (b) all other
liabilities and obligations of Sellers of any nature, or claims of such
liability or obligation, matured or unmatured, liquidated or unliquidated, fixed
or contingent, or known or unknown, principally relating to the Business (but
excluding any Excluded Liabilities) (collectively, the "Assumed Liabilities").
Section 2.5 LIABILITIES NOT ASSUMED.
(a) Notwithstanding the provisions of Section 2.4, Buyers
shall not assume or otherwise be responsible for any of the following
liabilities or obligations of any nature (including claims of such liabilities
or obligations, matured or unmatured, liquidated or unliquidated, fixed or
contingent, or known or unknown) of any Seller or other Wabtec Group Member
(collectively, the "Excluded Liabilities"):
(i) for any indebtedness for borrowed money, including any
interest or penalties accrued thereon;
(ii) for any income Taxes relating to any Tax Period,
except for such Taxes properly accrued on the Closing Date Balance
Sheets;
(iii) to any Wabtec Group Member or any other
inter-company payables;
(iv) to any former or current shareholder or director of
any Wabtec Group Member;
(v) relating to, resulting from or arising under any
Action relating to asbestos-containing gaskets allegedly manufactured
or distributed by
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any Wabtec Group Member (including, without limitation, those disclosed
on SCHEDULE 4.9);
(vi) except for the Employee Benefit Plans of the Acquired
Subsidiaries, relating to, resulting from or arising under any Seller
Benefit Plan other than any Assumed Collective Bargaining Agreement;
(vii) relating to, resulting from or arising from the
Seller Parties' obligations under this Agreement or any Seller
Ancillary Document;
(viii) incurred in connection with the negotiation,
preparation and execution of this Agreement and the transactions
contemplated hereby and any fees and expenses of counsel, accountants,
brokers, financial advisors or other experts of the Seller Parties; and
(ix) any liability for Pennsylvania use taxes of the Motor
Coils operations.
(b) Sellers shall be responsible for the satisfaction of all
of the Excluded Liabilities.
Section 2.6 ACQUIRED SUBSIDIARY LIABILITIES. At the Closing and
subject to the terms and conditions of this Agreement, Wabtec shall assume and
become primarily responsible for the following liabilities and obligations of
any nature (including claims of such liabilities or obligations, matured or
unmatured, liquidated or unliquidated, fixed or contingent, or known or unknown)
of the Acquired Subsidiaries:
(a) for any indebtedness for borrowed money, including any
interest or penalties accrued thereon, except indebtedness for borrowed money
under a line of credit in an aggregate amount not to exceed 2 million Mexican
pesos;
(b) for any income Taxes relating to any Tax Period, except
for such Taxes properly accrued on the Closing Date Balance Sheets;
(c) to any Wabtec Group Member or any other inter-company
payables;
(d) to any former or current shareholder or director of any
Wabtec Group Member;
(e) relating to, resulting from or arising under any Action
relating to asbestos-containing gaskets allegedly manufactured or distributed by
any Wabtec Group Member (including, without limitation, those disclosed on
SCHEDULE 4.9);
(f) relating to, resulting from or arising from the Seller
Parties' obligations under this Agreement or any Seller Ancillary Document; and
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(g) incurred in connection with the negotiation, preparation
and execution of this Agreement and the transactions contemplated hereby and any
fees and expenses of counsel, accountants, brokers, financial advisors or other
experts of the Seller Parties.
(The Acquired Subsidiary Liabilities assumed by Wabtec pursuant to this Section
2.6 are collectively referred to herein as the "Retained Subsidiary
Liabilities.") Sellers shall be responsible for the satisfaction of all Retained
Subsidiary Liabilities.
ARTICLE III.
PURCHASE PRICE; ADJUSTMENTS; ALLOCATIONS
Section 3.1 CONSIDERATION. Upon the terms and subject to the conditions set
forth in this Agreement, in consideration for the sale by the Seller Parties to
Buyers of the Purchased Assets and the representations, warranties and covenants
made by Seller Parties to Buyers, at the Closing:
(a) Buyers shall assume or cause to be paid at the Closing the
Assumed Liabilities as provided in Section 2.4 of this Agreement; and
(b) Subject to adjustment pursuant to Section 6.14, GETS (or
its nominee) shall pay to Wabtec (or its nominee) an amount equal to
$240,000,000 (the "Purchase Price") by wire transfer of immediately available
funds to a bank account (or multiple accounts) designated by Wabtec in writing
at least three (3) business days prior to the Closing Date.
Section 3.2 POST-CLOSING ADJUSTMENT.
(a) During the period between the date hereof and the Closing,
Wabtec and GETS will periodically discuss when, and on what day of the month,
the Closing is likely to occur. If the Parties determine that the Closing will
occur between the first and the fifteenth day of a month, which determination
will be made no later than two weeks prior to the end of the month preceding the
month in which the Parties believe the Closing will occur (the "Preceding
Month"), Wabtec shall perform a physical inventory as of the first day after the
end of the Preceding Month (the "Preceding Month Inventory"). If the Parties
determine that the Closing will occur after the fifteenth day of a month, or if
a Preceding Month Inventory is not taken, (i) the Closing shall take place on
the last day of the month in which the conditions set forth in Article X are
satisfied or waived and (ii) Wabtec shall perform a physical inventory as of the
first day after the end of such month (the "Closing Month Inventory"). GETS and
its public accountants shall be entitled to observe the taking of the Preceding
Month Inventory or Closing Month Inventory, as the case may be.
(b) If the Closing occurs prior to 12:00 a.m. on the sixteenth
day of a month, the date of the Closing Date Balance Sheets shall be the last
day of month preceding the month during which the Closing occurs. Otherwise, the
date of the Closing Date Balance Sheets shall be the Closing Date. At the
Closing (or within ten (10) business days after the date of the Closing Date
Balance Sheets, if later than the Closing Date), Wabtec (or its independent
public accountant) shall deliver to GETS: (x) a balance sheet for each Division
of the Business as of the date determined above (the "Closing Date Balance
Sheets"), (y) an accompanying closing
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statement (the "Closing Statement") reasonably detailing Sellers' determination
of the Closing Date Net Worth and (z) if the Closing occurs on or prior to 12:00
a.m. on the sixteenth day of a month, a statement of daily cash flow of each
Division of the Business for the period commencing on the first day of such
month and ending on the Closing Date (the "Cash Flow Statement"). The Cash Flow
Statement, if any, shall be subject to verification and audit by GETS and its
independent public accountant for a period of ten (10) business days after its
delivery. The Closing Date Balance Sheets shall be: (i) prepared as if they were
year-end balance sheets (including typical year-end adjustments customarily made
by Seller Relating to the Business); (ii) prepared in accordance with GAAP,
applied on a basis consistent with that used to prepare the Business Balance
Sheets and the Interim Balance Sheets; and (iii) in a format identical to and in
a manner consistent with the Business Balance Sheets and the Interim Balance
Sheets. The accounting procedures used to prepare the Closing Date Balance
Sheets shall include the results of the Preceding Month Inventory or the Closing
Month Inventory, as the case may be. Any shortages or shrinkages resulting from
such physical inventory shall be applied first to any shrinkage reserve
previously recorded in the financial statements immediately preceding the prior
reporting period. The results of such physical inventory shall be used to
determine the inventory balances, and in valuing the inventory, Wabtec costs
shall be used. Prior to delivery of the Closing Date Balance Sheets, GETS and
its accountants shall be permitted to discuss with Wabtec and its accountants
the proposed Closing Date Balance Sheets and the Cash Flow Statement (if any),
and GETS and its accountants shall have full access upon reasonable notice at
all reasonable times during normal business hours to the work papers and
supporting records of Wabtec relating to the preparation of the Closing Date
Balance Sheets and the Cash Flow Statement (if any), so as to permit GETS and
its accountants to make copies of such work papers and supporting records and to
allow GETS to become informed concerning all matters relating to such
preparation and the accounting procedures, methods, tests and approaches being
utilized in connection therewith. GETS must, within thirty (30) days after its
receipt of the Closing Date Balance Sheets, the Closing Statement, and the Cash
Flow Statement (if its delivery is required), give written notice (the "Notice")
to Wabtec specifying in reasonable detail GETS' objections, if any, with respect
thereto. If GETS does not timely deliver the Notice, Wabtec's determination of
the Closing Date Balance Sheets, the Cash Flow Statement (if any) and the
Closing Date Net Worth shall be final, binding and conclusive on the Parties.
With respect to any disputed amounts, GETS and Wabtec shall negotiate in good
faith during the ten (10) business day period (the "Resolution Period") after
the date of Wabtec's receipt of the Notice to resolve any such disputes. If GETS
and Wabtec are unable to resolve any such dispute within the Resolution Period,
then within five (5) business days after the expiration of the Resolution
Period, all unresolved disputes shall be submitted to the New York, New York
office of PricewaterhouseCoopers LLP (the "Independent Accountant"), who shall
be engaged to provide a final and conclusive resolution of all unresolved
disputes within fifteen (15) business days after such engagement. The
determination of the Independent Accountant shall be final, binding and
conclusive on GETS and Wabtec, and the fees and expenses of the Independent
Accountant shall be borne equally by GETS and Wabtec.
(c) If the Closing Date Net Worth as finally determined
pursuant to Section 3.2(b) is less than the Benchmark Net Worth by more than
$5,000,000, Wabtec shall pay to GETS the amount by which the difference between
the Closing Date Net Worth and the Benchmark Net Worth exceeds $5,000,000. If
the Cash Flow Statement is required to be delivered pursuant to Section 3.2(b),
then (i) if the Cash Flow Statement reflects that the cash
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receipts of the Business exceeded the cash disbursements for the period
beginning on the first day following the end of the Preceding Month and ending
on the Closing, then Wabtec shall remit to GETS the amount of such excess, or
(ii) if the Cash Flow Statement reflects that the cash disbursements of the
Business exceeded the cash receipts for the period beginning on the first day
following the end of the Preceding Month and ending on the Closing, GETS shall
remit to Wabtec the amount of such deficit. All payments required pursuant to
this Section 3.2(c) shall be made within five (5) business days after final
determination of the Closing Date Balance Sheets and the Cash Flow Statements
(if required to be delivered) pursuant to Section 3.2(b).
Section 3.3 PURCHASE PRICE ALLOCATION. The Parties hereby agree that
the Purchase Price, the amount of the Assumed Liabilities and the covenant not
to compete set forth in Section 6.9 shall be allocated for purposes of this
Agreement and for federal, state, local and foreign Tax purposes as set forth on
SCHEDULE 3.3. The Parties shall file all federal, state, local and foreign Tax
Returns, including Internal Revenue Form 8594, in accordance with the allocation
set forth on SCHEDULE 3.3.
ARTICLE IV.
REPRESENTATIONS AND WARRANTIES OF SELLERS
Each Seller jointly and severally represents and warrants to Buyers as
follows:
Section 4.1 ORGANIZATION. SCHEDULE A contains a true and correct list
of each Seller, indicating the type of entity it is, the jurisdiction in which
it was formed or incorporated, and each jurisdiction in which it is qualified or
registered to do business as a foreign entity. Each Seller Party has been duly
formed and is validly existing under the laws of the jurisdiction in which it
was formed or incorporated and has all requisite power and authority to own,
lease and operate its properties and to carry on its business as now being
conducted. Each Seller Party is duly qualified or registered as a foreign
corporation to transact business under the Applicable Law of each jurisdiction
where the character of its activities or the location of the properties owned or
leased by it requires such qualification or registration, except where the
failure to be so qualified would not be material. No Acquired Subsidiary owns,
directly or indirectly, any equity or other ownership interest in any Person,
and no Acquired Subsidiary is subject to any obligation or requirement to
provide funds to or make any investment (in the form of a loan, capital
contribution or otherwise) in any Person. No Acquired Subsidiary currently
conducts, or has conducted in the past five years, any businesses other than the
Business.
Section 4.2 CAPITALIZATION OF THE ACQUIRED SUBSIDIARIES. SCHEDULE B
sets forth for each Acquired Subsidiary (a) its name and jurisdiction of
incorporation, (b) the number of authorized shares of each class of its capital
stock, (c) the number of issued and outstanding shares of each class of its
capital stock, (d) the number of shares of its capital stock held in treasury,
(e) all of its directors and officers, and (f) each jurisdiction in which it is
qualified or registered to do business as a foreign entity. The issuance and
sale of all of the shares of capital stock of the Acquired Subsidiaries,
including the Acquired Subsidiary Shares, have been in material compliance with
all Applicable Law. All of the Acquired Subsidiary Shares are duly authorized,
validly issued, fully paid and nonassessable. SCHEDULE B sets forth each holder,
of record and beneficially, of all of the Acquired Subsidiary Shares. All
Acquired Subsidiary Shares are held
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free and clear of any restrictions on transfer (other than restrictions under
the securities laws of the United States), Taxes, Liens, options, warrants,
purchase rights, contracts, commitments, equities, claims and demands. There are
no outstanding securities convertible into or exchangeable for capital stock or
voting securities of any Acquired Subsidiary, and no options, warrants, purchase
rights, subscription rights, conversion rights, exchange rights, other contracts
or commitments (other than this Agreement) or Applicable Law, that could require
any Seller or their Affiliates (including the Acquired Subsidiaries) to issue,
sell, transfer, or otherwise dispose of any capital stock of any of the Acquired
Subsidiaries or that could require any Acquired Subsidiary to issue, sell, or
otherwise cause to become outstanding any of its own capital stock. There are no
outstanding stock appreciation, phantom stock, profit participation or similar
rights with respect to any Acquisition Subsidiary. There are no voting trusts,
proxies or other agreements or understandings with respect to the voting of any
capital stock of any Acquired Subsidiary. Upon the deliveries made at the
Closing, Buyers will become the owner of all right, title and interest in and to
Acquired Subsidiary Shares free and clear of all Liens, except for restrictions
imposed by the securities laws of the United States.
Section 4.3 AUTHORIZATION. Each Seller Party has full power and
authority to execute and deliver this Agreement and any other certificate,
agreement, document or other instrument to be executed and delivered by it in
connection with the transactions contemplated by this Agreement (collectively,
the "Seller Ancillary Documents") and to perform its obligations under this
Agreement and the applicable Seller Ancillary Documents and to consummate the
transactions contemplated hereby and thereby. The execution and delivery of this
Agreement and the applicable Seller Ancillary Documents by each Seller Party,
the performance by such Person of its obligations hereunder and thereunder, and
the consummation of the transactions provided for herein and therein have been
duly and validly authorized by all necessary board and shareholder action on the
part of such Person. No vote of the shareholders of Wabtec is required with
respect to the consummation of the transactions provided for herein. This
Agreement has been, and the applicable Seller Ancillary Documents will be as of
the Closing, duly executed and delivered by each Seller Party and do (and will)
constitute the valid and binding agreements of such Person, enforceable against
it in accordance with their respective terms.
Section 4.4 ABSENCE OF RESTRICTIONS AND CONFLICTS. The execution,
delivery and performance of this Agreement and the Seller Ancillary Documents,
the consummation of the transactions provided for herein and therein, and the
fulfillment of and compliance with the terms and conditions hereof and thereof
do not (or will not), with the passing of time or the giving of notice or both,
violate or conflict with, constitute a breach of or default under, result in the
loss of any benefit under, permit the acceleration of any obligation under or
create in any party the right to terminate, modify or cancel (a) any term or
provision of the charter documents of any Seller Party, (b) except as indicated
on SCHEDULE 2.1(h), any Material Contract, (c) any judgment, decree or order of
any Governmental Entity to which any Seller Party is a party or by which any
Seller Party, the Business or the Purchased Assets are bound; or (d) any
material Permit or Applicable Law applicable to any Seller Party, the Business
or the Purchased Assets. No consent, approval, order or authorization of, or
registration, declaration or filing with, any Governmental Entity is required
with respect to any Seller Party in connection with the execution, delivery or
performance of this Agreement and the Seller Ancillary Documents or the
consummation of the transactions provided for herein and therein, except as
required by the Antitrust Acts.
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Section 4.5 REAL PROPERTY.
(a) The Owned Real Property, as listed on SCHEDULE 2.1(b),
constitutes all parcels of real property used primarily in connection with the
Business and owned by any Wabtec Group Member, except for the facilities located
in Boise, Idaho and St. Louis, Missouri. Sellers have good and marketable fee
simple title to each parcel of Owned Real Property free and clear of all Liens
other than Permitted Liens. No Acquired Subsidiary owns any parcels of real
property.
(b) Set forth on SCHEDULE 2.1(g) is a complete and accurate
list of all parcels of real property, together with all buildings, structures
and improvements relating thereto, used in connection with the Business and
leased by any Wabtec Group Member (the "Leased Real Property" and together with
the Owned Real Property, the "Real Property"). Each Seller Party that leases
Leased Real Property has a valid leasehold interest in its Leased Real Property,
free and clear of any Liens other than Permitted Liens. Each such lease is
legal, valid, binding and enforceable in accordance with its respective terms
with respect to each Seller Party that is a party thereto and, to the Knowledge
of the Seller Parties, each other party thereto. There are no existing material
defaults or breaches of any Seller Party under any such lease (or events or
conditions which, with notice or lapse of time or both would constitute a
default or breach) and, to the Knowledge of the Seller Parties, there are no
such defaults (or events or conditions which, with any notice or lapse of time
or both, would constitute a default or breach) with respect to any other party
to any such lease.
(c) Sellers have received no written notice that any material
portion of the Real Property, or any of the plants, buildings, structures and
other improvements located thereon, violates any Applicable Law, including those
relating to zoning, building, land use, the Environment, health and safety,
fire, air, sanitation and noise control.
(d) All of the Real Property is in the possession or control
of one or more Seller Party and no other Person is entitled to possession (other
than a lessor of any Leased Property) of any such properties. There are no
leases, subleases or licenses granting to any third party the right of use or
occupancy of any portion of any Real Property. There are no outstanding options
or rights of first refusal to purchase the Owned Real Property or any portion
thereof or interest therein.
(e) The plants, buildings and structures located on the Real
Property currently have access to water supply, storm and sanitary sewer
facilities, telephone, gas and electrical connections, fire protection, drainage
and other public utilities, in each case as is necessary for the conduct of the
Business as it is presently conducted. To Knowledge of the Seller Parties, such
plants, building and structures are in good operating condition and in a state
of good maintenance and repair, ordinary wear and tear excepted, and are
structurally sound. There are no condemnation or appropriation or similar
proceedings pending or, to the Knowledge of the Seller Parties, threatened
against any of the Real Property.
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Section 4.6 TITLE TO AND SUFFICIENCY OF ASSETS.
(a) Except as set forth in SCHEDULE 4.6(a), (i) Sellers own
and have (and will convey at Closing) good and marketable title to all of the
Seller Purchased Assets, free and clear of any Liens except for Permitted Liens,
and (ii) the Acquired Subsidiaries own, and have good title and marketable title
to, all of the Acquired Subsidiary Assets, free and clear of any Liens except
for Permitted Liens.
(b) The Purchased Assets constitute all of the assets
necessary and sufficient to conduct the operations of the Business as presently
conducted by the Seller Parties. No Person other than a Seller Party owns any
equipment, computer hardware, machinery, vehicles or other tangible personal
property or assets situated on the premises of such Seller Party that are
necessary to the operation of the Business, except for such assets that are
leased by such Seller Party.
(c) Since December 31, 2000, no Seller Party has sold,
transferred or disposed of any assets of the Business, other than in the
ordinary course of business consistent with past practice.
Section 4.7 FINANCIAL STATEMENTS.
(a) Wabtec has furnished to GETS an unaudited balance sheet as
of December 31, 2000 and 1999 for each Division of the Business (the "Business
Balance Sheets"). The Business Balance Sheets (i) have been prepared from and
are in accordance with the books and records of the Seller Parties, (ii) have
been prepared in conformity with GAAP (excluding footnotes and statements of
shareholders' equity and cash flows), (iii) have been prepared in a manner
consistent with the balance sheets included with the audited consolidated
financial statements of Wabtec and its subsidiaries as filed with the Securities
and Exchange Commission pursuant to the Securities Exchange Act of 1934, as
amended, or the Securities Act of 1933, as amended (the "Consolidated Financial
Statements"), which includes any applicable year-end adjustments, (iv) are true,
correct and complete in all material respects, and (v) fairly present in all
material respects the financial condition of each Division of the Business as
operated by the Seller Parties as of the date stated.
(b) The (A) balance sheets for each Division of the Business
as of March 31, 2001 (the "March 2001 Balance Sheets"), which Seller has
furnished to Buyer, and (B) when delivered in accordance with Section 6.4, the
quarterly balance sheets for each Division of the Business as of the dates
stated, (collectively, including the March 2001 Balance Sheets, the "Interim
Balance Sheets"): (i) have been (or will be) prepared from and in accordance
with the books and records of the Seller Parties, (ii) have been (or will be)
prepared in conformity with GAAP (excluding footnotes and statements of
shareholders' equity and cash flows) applied on a basis consistent with that
used in the Business Balance Sheets, (ii) have been (or will be) prepared in a
format consistent with the Business Balance Sheets, (iii) are (or will be) true,
correct and complete in all material respects, (iv) fairly present (or will
fairly present) in all material respects the financial condition of each
Division of the Business as operated by the Seller Parties as of such dates, and
(v) exclude the items specifically excluded in the definition of Benchmark Net
Worth.
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(c) Wabtec has furnished to GETS an unaudited statement of
income for the fiscal year ended on December 31, 2000 for each Division of the
Business (the "Business Income Statements"). The Business Income Statements (i)
have been prepared from and are in accordance with the books and records of the
Seller Parties, (ii) have been prepared in conformity with GAAP (excluding
footnotes and statements of shareholders' equity and cash flows), (iii) have
been prepared in a manner consistent with the Consolidated Financial Statements,
which includes any applicable year-end adjustments, (iv) are true, correct and
complete in all material respects, and (v) fairly present in all material
respects the results of operations of each Division of the Business as operated
by the Seller Parties for the year then ended. There are no non-recurring gains
(including, but not limited to, gains from dispositions of assets not in the
ordinary course of business) included in the Business Income Statements in
excess of $250,000 individually or $1,000,000 in the aggregate.
(d) The (A) statement of income for each Division of the
Business for the quarter ended March 31, 2001, which Seller has furnished to
Buyer, and (B) when delivered in accordance with Section 6.4, the quarterly
statements of income for each Division of the Business for the quarters ending
as of the dates stated (collectively, the "Interim Income Statements"): (i) have
been (or will be) prepared from and in accordance with the books and records of
the Seller Parties, (ii) have been (or will be) prepared in conformity with GAAP
(excluding footnotes and statements of shareholders' equity and cash flows)
applied on a basis consistent with that used in the Business Income Statements,
(iii) have been (or will be) prepared in a format consistent with the Business
Income Statements, (iv) are (or will be) true, correct and complete in all
material respects, and (v) fairly present (or will present) in all material
respects the results of operations of each Division of the Business as operated
by the Seller Parties for the periods then ended. There are no non-recurring
gains (including, but not limited to, gains from dispositions of assets not in
the ordinary course of business) included in the Interim Income Statements in
excess of $250,000 individually or $1,000,000 in the aggregate.
(e) The representations set forth in clauses (c) and (d) above
do not include any effect on the statements of income furnished to Buyer which
may occur from an adjustment of a balance sheet item or a breach of any other
representation or warranty of the Seller Parties in this Agreement.
Section 4.8 ABSENCE OF CERTAIN CHANGES. Since December 31, 2000, and
except as set forth in SCHEDULE 4.8, there has not been (a) any event,
occurrence, development or state of circumstances or facts which, individually
or in the aggregate, has had or could reasonably be expected to have a Material
Adverse Effect on the Business, other than those primarily resulting from or
arising in connection with events or occurrences that affect the U.S. or Mexican
economies generally or the industry in which the Business operates generally, or
(b) any damage, destruction, loss or casualty to property or assets used in the
Business with a value in excess of $250,000 individually or $1,000,000 in the
aggregate, whether or not covered by insurance.
Section 4.9 LEGAL PROCEEDINGS. Except as set forth in SCHEDULE 4.9,
there is no suit, claim, action, proceeding or investigation affecting the
Business (an "Action") pending or, to the Knowledge of the Seller Parties,
threatened against any Seller Party or any of their respective officers or
directors. No Seller Party is subject to any outstanding order, writ, injunction
or decree.
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Section 4.10 COMPLIANCE WITH LAW. To the Knowledge of the Seller
Parties, except as set forth on SCHEDULE 4.10, each Seller Party is in material
compliance with all Applicable Law applicable to the Business. Except as set
forth in SCHEDULE 4.10 and to the Knowledge of the Seller Parties, (i) no Seller
Party has been charged with and, to the Knowledge of the Seller Parties, is not
now under investigation with respect to a material violation of any Applicable
Law applicable to the Business, (ii) no Seller Party is a party to or bound by
any order, judgment, decree or award of any Governmental Entity applicable to
the Business, and (iii) each Seller Party has filed all material reports and has
all material Permits issued in connection with the Business required to be filed
with any Governmental Entity or obtained in connection with the Business.
Section 4.11 MATERIAL CONTRACTS.
(a) SCHEDULE 2.1(h) sets forth a true and correct list of
Seller Agreements that fall within any of the following categories:
(i) all, bonds, indentures, mortgages, promissory notes,
loan agreements, guarantees, letters of credit or other agreements,
instruments or commitments for the borrowing or the lending of money in
an amount in excess of $500,000, or providing for the creation of any
material Lien upon any of the Purchased Assets;
(ii) all leases (as lessor or lessee) or licenses (as
licensor or licensee) of any property or assets (whether real, personal
or mixed, tangible or intangible) involving an annual commitment or
payment of more than $500,000 individually by any Seller Party;
(iii) Seller Agreements that, after the Closing, would
have the effect of limiting the freedom of Buyers or the Acquired
Subsidiaries to compete in any line of business in any geographic area
or to hire any individual or group of individuals, including any Seller
Agreements with distributors granting any exclusive rights;
(iv) joint venture, partnership, operating and similar
Seller Agreements;
(v) all franchising and licensing agreements and all other
agreements relating to Seller Intellectual Property (excluding those
relating to over-the-counter pre-packaged and accounting software);
(vi) any Seller Agreement for capital expenditures or the
acquisition or construction of fixed assets requiring the payment by
any Seller Party of an amount in excess of $100,000;
(vii) any Seller Agreement that provides for an increased
payment or benefit in excess of $100,000, or accelerated vesting of
rights, upon the execution of this Agreement or in connection with the
transactions contemplated hereby;
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(viii) any Seller Agreement granting any Person a Lien on
all or any part of any of the Purchased Assets with an original
purchase price in excess of $50,000;
(ix) any Seller Agreement for the cleanup or abatement in
connection with any Hazardous Materials, the remediation of any
existing environmental condition or relating to the performance of any
environmental audit or study;
(x) any Seller Agreement granting to any Person an option
or a first refusal, first offer or similar preferential right to
purchase or acquire any Purchased Assets with an original purchase
price in excess of $100,000;
(xi) any material Seller Agreement that has a remaining
duration of more than twelve (12) months that is a fixed price or other
risk sharing agreement with a customer not cancelable by any Seller
Party (without premium or penalty) upon no more than thirty (30) days
notice;
(xii) any Seller Agreement with any agent, distributor or
representative that is not cancelable by any Seller Party (without
premium or penalty) upon no more than thirty (30) days notice;
(xiii) any Seller Agreement for the granting or receiving
of a license, sublicense or cross-license or under which any Person is
obligated to pay or has the right to receive a royalty, license fee or
similar payment in excess of $500,000;
(xiv) any Seller Agreement with a labor organization;
(xv) any Seller Agreement providing for the
indemnification or holding harmless of any officer, director, employee
or any other Person outside of the ordinary course of business;
(xvi) any Seller Agreement providing for "earn-outs" or
other contingent payments in excess of $50,000;
(xvii) any Seller Agreement that contains minimum purchase
conditions or requirements or other terms that restrict or limit the
purchasing relationships of any Seller Party or any customer thereof;
(xviii) any Seller Agreement with any customer for the
provision of goods or services by any Seller Party involving payments
of more than $2,000,000 over its term;
(xix) any outstanding power of attorney empowering any
Person to act on behalf of any Acquired Subsidiary; and
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(xx) all other existing written contracts (other than
those described in the foregoing subparagraphs of this Section 4.11(a))
by which any of the Purchased Assets or any Acquired Subsidiary are
bound that involve an annual commitment or annual payment to or from
any Seller Party of more than $500,000 individually or that are
otherwise material to the Business.
(The Seller Agreements listed on SCHEDULE 2.1(h) are collectively referred to
herein as the "Material Contracts." The Seller Agreements that are not required
to be disclosed on SCHEDULE 2.1(h) pursuant to this Section 4.11(a) are
collectively referred to herein as the "Immaterial Contracts.")
(b) Each Material Contract is legal, valid, binding and
enforceable in accordance with its respective terms with respect to each Seller
Party that is a party thereto and, to the Knowledge of the Seller Parties, each
other party thereto. There are no existing material defaults or breaches of any
Seller Party under any Material Contract (or events or conditions which, with
notice or lapse of time or both would constitute a default or breach) and, to
the Knowledge of the Seller Parties, there are no such defaults (or events or
conditions which, with any notice or lapse of time or both, would constitute a
default or breach) with respect to any other party to any Material Contract. No
Seller Party is participating in any discussions or negotiations with any third
party regarding material modification of or amendment to any Material Contract
or entering into any new contract outside of the ordinary course of business
that binds the Business, the Purchased Assets or any Acquired Subsidiary that if
already entered into as of the date hereof would be required to have been listed
on SCHEDULE 2.1(h). SCHEDULE 2.1(h) identifies with an asterisk each Material
Contract set forth therein that requires the consent of or notice to any other
party to avoid any breach, default or violation thereof in connection with the
transactions contemplated hereby, including the assignment of such Material
Contract to Buyers, if applicable. There are no contracts, agreements or
understandings that are material to the Business other than the Material
Contracts.
Section 4.12 INSURANCE POLICIES. Each Seller Party maintains
insurance with reputable insurers for the business and assets of any Seller
Party against all risks normally insured against, and in amounts normally
carried, by corporations of similar size engaged in similar lines of business
and such coverage is sufficient. All insurance policies and bonds covering the
Business or the Purchased Assets are in full force and effect and will be
maintained by the applicable Seller Party in full force and effect as they apply
to any matter, action or event relating to such Seller Party occurring through
the Closing. There is no claim by any Seller Party pending under any of such
policies or bonds as to which coverage has been questioned, denied or disputed
by the underwriters of such policies or bonds or in respect of which such
underwriters have reserved their rights. All premiums payable under all such
policies and bonds have been timely paid and each Seller Party has otherwise
complied fully with the terms and conditions of all such policies and bonds. To
the Knowledge of the Seller Parties, there is no threatened termination of,
premium increase with respect to, or material alteration of coverage under, any
of such policies or bonds.
Section 4.13 ENVIRONMENTAL, HEALTH AND SAFETY MATTERS. Except
as set forth in SCHEDULE 4.13, with respect to the Business, the Acquired
Subsidiaries and the Purchased Assets
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(for purposes of this Section, the term "Seller Party" includes any Person that
was, in whole or in part, an immediate predecessor to any Seller Party with
respect to the Business):
(a) Each Seller Party possesses, and is in compliance with,
all material Permits relating to the Business and has filed all notices that are
required under applicable Environmental Law relating to the Business, and each
Seller Party is in compliance with all applicable limitations, restrictions,
conditions, standards, prohibitions, requirements, obligations, schedules and
timetables contained in any applicable Environmental Law relating to the
Business.
(b) No Seller Party has received notice of actual or
threatened liability relating to the Purchased Assets under CERCLA or any other
applicable Environmental Law from any Governmental Entity or any other Person
and, to the Knowledge of the Seller Parties, there are no facts or circumstances
that could form the basis for the assertion of any claim relating to the
Purchased Assets against any Seller Party under any applicable Environmental Law
including, without limitation, CERCLA or any similar local, state or foreign law
with respect to any on-site or off-site location.
(c) No Seller Party has entered into or agreed to enter into,
and no Seller Party currently intends to enter into, any consent decree or order
relating to the Business, and no Seller Party is subject to any judgment, decree
or judicial or administrative order relating to compliance with, or the cleanup
of Hazardous Materials relating to the Business under, any applicable
Environmental Law.
(d) No notice, notification, demand, request for information,
citation, summons or order for an administrative or judicial proceeding relating
to the Business has been received by any Seller Party; and no complaint has been
filed, no penalty has been assessed and no Action is pending against or, to the
Knowledge of the Seller Parties, threatened by any Governmental Entity or other
Person against any Seller Party arising out of any applicable Environmental Law.
(e) No Seller Party is subject to any claim, obligation,
liability, loss, damage or expense of whatever kind or nature, contingent or
otherwise, incurred or imposed or based upon any provision of any applicable
Environmental Law or arising out of any act or omission of any Seller Party, or
their employees, agents or representatives or arising out of the ownership, use,
control or operation by any Seller Party of any plant, facility, site, area or
property (including, without limitation, any plant, facility, site, area or
property currently or previously owned or leased by any Seller Party or any
waste disposal site not owned, leased or operated by a Seller Party) from which
any Hazardous Materials were Released into the Environment, and there are no
events, conditions, situations or set of circumstances of which any Seller Party
is aware that could reasonably be expected to result in or be the basis for any
such liability.
(f) No polychlorinated biphenyls, lead (except for paint),
asbestos-containing material (except for non-friable materials), incinerator,
sump, surface impoundment, lagoon, landfill, septic, wastewater treatment or
other disposal system or underground storage tank (active or inactive) is or has
been present at, on or under any Real Property or in any Purchased Asset
currently owned, leased or operated by any Seller Party.
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(g) No Seller Party has imported, manufactured, stored, used,
operated, transported, treated or disposed of any Hazardous Materials other than
in compliance with all applicable Environmental Law.
(h) There has been no environmental investigation, study,
audit, test, review or other analysis conducted of which any Seller Party has
Knowledge in relation to any Purchased Asset, Real Property or any other
property or facility now or previously owned or leased by any Seller Party that
has not been made available to GETS.
Section 4.14 INTELLECTUAL PROPERTY; SOFTWARE.
(a) Set forth on SCHEDULE 2.1(e) is a true and correct list of
registered copyrights, tradenames, trademarks, trade secrets, service marks,
domain names, invention disclosures, know how, patents (and applications
therefore) and software used in the Business and being transferred to the Buyers
("Seller Intellectual Property"). SCHEDULE 2.1(e) indicates each jurisdiction in
which such Seller Intellectual Property is registered, if any. The Seller
Intellectual Property set forth on SCHEDULE 2.1(e), together with the
Intellectual Property listed on SCHEDULE 4.14(a), constitutes all the
Intellectual Property used in connection with the operation of the Business as
presently conducted. To the Knowledge of the Seller Parties, no Intellectual
Property other than the Intellectual Property set forth on SCHEDULE 2.1(e) and
SCHEDULE 4.14(a) is necessary for Buyers to operate the Business in
substantially the same manner as the Business is presently conducted.
(b) Except as set forth in SCHEDULE 4.14(b): (i) the Seller
Parties own the entire right, title and interest in and to, and have the right
to use, free and clear of any Liens, the Seller Intellectual Property, and such
Seller Parties have the exclusive right to bring Actions for any infringement
thereof; (ii) all of the patents, trademark registrations, service xxxx
registrations, tradename registrations, domain name registrations, design right
registrations, and copyright registrations included in the Seller Intellectual
Property are enforceable and in good standing with the respective Governmental
Entity with which it is registered; (iii) with respect to the operation of the
Business, no Person has asserted, nor does any Seller Party have any Knowledge
that, any Seller Party or a licensee of a Seller Party is infringing or has
infringed any domestic or foreign patent, trademark, service xxxx, tradename,
copyright, domain name right or design right, or has misappropriated or
improperly used or disclosed any Trade Secret, Confidential Information or
know-how; (iv) all working requirements and all fees, annuities, and other
payments which are due on or before the Closing Date for any of the Seller
Intellectual Property, including, without limitation, all foreign or domestic
patents, patent applications, trademark registrations, service xxxx
registrations, tradename registrations, domain name registrations, copyright
registrations and any applications for any of the preceding, have been met or
paid; (v) the Seller Intellectual Property is not the subject of any pending
Action; (vi) no part of the Seller Intellectual Property was obtained through
inequitable conduct or fraud in the United States Patent and Trademark Office or
any foreign Governmental Entity; (vii) the execution, delivery and performance
of this Agreement by the Seller Parties, and the consummation of the
transactions contemplated hereby, will not breach, violate or conflict with any
instrument or agreement governing or contained within any of the Seller
Intellectual Property, will not cause the forfeiture or termination or give rise
to a right of forfeiture or termination of any of the Seller Intellectual
Property or in any way impair the right of Buyers or the Acquired Subsidiaries
to
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use, sell, offer to sell, license or dispose of, or to bring any Action for
the infringement of, any Seller Intellectual Property following the Closing;
(viii) there are no royalties, honoraria, fees or other payments payable to any
third party by reason of the ownership, use, license, sale or disposition of the
Seller Intellectual Property; and (ix) to the Knowledge of the Seller Parties,
no Person is infringing on or has misappropriated any of the Intellectual
Property rights of any of the Seller Parties.
(c) To the Knowledge of the Seller Parties, each Seller Party
has taken all steps that are reasonably necessary and appropriate to safeguard
and maintain (i) the secrecy and confidentiality of all Trade Secrets contained
in the Seller Intellectual Property; (ii) all patents contained in the Seller
Intellectual Property (including, without limitation, entering into appropriate
assignments with all current and former officers, directors, employees and third
party consultants of such Seller Party); and (iii) all trademarks, service
marks, domain names and tradenames contained in the Seller Intellectual
Property.
(d) SCHEDULE 4.14(d) also sets forth a true and complete list
of: (i) all software used in the Business that is owned by any Seller Party (the
"Seller Proprietary Software"); (ii) all software other than Seller Proprietary
Software used by any Wabtec Group Member in the Business (the "Seller Licensed
Software" and, together with the Seller Proprietary Software, the "Seller
Software"); and (iii) all technical and restricted materials relating to the
acquisition, design, development, use of maintenance of computer code program
documentation and materials used in the Business. As the Business is presently
conducted, the use of the Seller Software does not breach any terms of any
license or other agreement between any Seller Party and any other Person. Each
Seller Party is in compliance with the terms and conditions of all license
agreements in favor of such Seller Party relating to the Seller Licensed
Software. The Seller Proprietary Software is free and clear of all Liens. The
Seller Proprietary Software was either (i) developed by employees of a Seller
Party working within the scope of their employment at the time of such
development; (ii) developed by agents, consultants, contractors or others who
have executed appropriate instruments of assignment in favor of a Seller Party
as assignee that have conveyed to such Seller Party ownership of all of his or
her Intellectual Property rights in the Seller Proprietary Software; or (iii)
acquired by a Seller Party in connection with acquisitions in which such Seller
Party obtained appropriate representations, warranties and indemnities from the
transferring party relating to the title to the Seller Proprietary Software. No
Seller Party has received notice from any other Person claiming any right, title
or interest in the Seller Proprietary Software. No Seller Party has granted
rights in the Seller Proprietary Software to any third party. The source code
for the Seller Proprietary Software has been maintained in confidence.
Section 4.15 TRANSACTIONS WITH AFFILIATES. Except in connection with
intercompany transactions in the ordinary course of business consistent with
past practice and except as set forth on SCHEDULE 4.15, no Wabtec Group Member
other than the Seller Parties, nor any officer or director of any Wabtec Group
Member, has any interest in: (a) any Material Contract or (b) any property
(real, personal or mixed), tangible or intangible, used or currently intended to
be used by any Seller Party in Relation to the Business or the Purchased Assets.
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Section 4.16 INVENTORY; ACCOUNTS RECEIVABLE; ACCOUNTS PAYABLE.
(a) The inventories reflected on the Business Balance Sheets,
the Interim Balance Sheets and on the Closing Date Balance Sheets have been
valued in accordance with GAAP (including materiality standards inherent in
GAAP). Physical adjustments since the most recent date of the Business Balance
Sheets have been correctly recorded in the ordinary course of business. Such
inventories (i) are carried at an amount not materially in excess of the lower
of cost or net realizable value, and (ii) do not include any material inventory
which is obsolete, surplus or not usable or salable in the lawful and ordinary
course of the Business, in each case net of reserves provided therefor.
(b) SCHEDULE 2.1(i) references a list of the accounts
receivable Relating to the Business as of March 31, 2001, showing the amount of
each such receivable and an aging of amounts due thereunder, which list is
materially true and complete as of that date. To the Knowledge of the Seller
Parties, the debtors to which such receivables relate are not in or subject to a
bankruptcy or insolvency proceeding, and none of the Receivables have been made
subject to an assignment for the benefit of creditors that have not been
provided for in the reserve for doubtful accounts. The accounts receivable
reflected on the Business Balance Sheets, the Interim Balance Sheets and on the
Closing Date Balance Sheets (net of any reserves shown thereon): (i) are valid,
existing and fully collectible in a manner consistent with the Seller Parties'
past practice without resort to legal proceedings or collection agencies and
(ii) to the Knowledge of the Seller Parties, are not subject to any refunds or
adjustments or any defenses or rights of set-off. No Seller Party has factored
any such receivables.
(c) The accounts payable reflected on the Business Balance
Sheets, the Interim Balance Sheets and on the Closing Date Balance Sheets arose
from bona fide transactions in the ordinary course of business.
Section 4.17 LICENSES AND PERMITS. SCHEDULE 4.17 is a true and
complete list of all material Permits (including, without limitation,
construction and operation permits), other than Environmental Permits, issued in
connection with the Business or relating to any Purchased Assets; provided,
however, that all Permits relating to human health and safety are deemed
material for purposes of this Section 4.17. To the Knowledge of the Seller
Parties, the Permits listed on SCHEDULE 4.17 are all of the material Permits
that are necessary to carry on the Business as presently conducted, and all such
Permits held by Sellers are transferable to Buyers. All such Permits are
currently in effect. The execution, delivery, and performance of this Agreement
and the consummation of the transactions contemplated hereby will not adversely
affect any such Permit. The Seller Parties have taken all necessary action to
maintain each such Permit, except where the failure to so act is not likely to
have a Material Adverse Effect on the Business. No Seller Party is in default
and no condition exists that with notice or lapse of time or both could
constitute default under any such Permit. To the Knowledge of the Seller
Parties, no loss or expiration of any such Permit is threatened, pending, or
reasonably foreseeable (other than expiration upon the end of any term).
Section 4.18 ETHICAL PRACTICES. No Seller Party, nor any agent or
representative thereof, has offered or given, and to the Knowledge of the Seller
Parties, no other Person has offered or given on its behalf, anything of value
to: (a) any official of a Governmental Entity, any political
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party or official thereof, or any candidate for political office; (b) any
customer or member of the government; or (c) any other Person, in any such case
while knowing or having reason to know that all or a portion of such money or
thing of value may be offered, given or promised, directly or indirectly, to any
customer, member of the government or candidate for political office for the
purpose of the following: (x) influencing any action or decision of such Person,
in such Person's official capacity, including a decision to fail to perform such
Person's official function to assist any Seller Party in obtaining or retaining
business for, or with, or directing business to, any Person; (y) inducing such
Person to use such Person's influence with any government or instrumentality
thereof to affect or influence any act or decision of such government or
instrumentality to assist any Seller Party in obtaining or retaining business
for, or with, or directing business to, any Person; or (z) where such payment
would constitute a bribe, kickback or illegal or improper payment to assist any
Seller Party in obtaining or retaining business for, or with, or directing
business to, any Person.
Section 4.19 BROKERS, FINDERS AND INVESTMENT BANKERS. No Seller Party,
nor any of its officers, directors, employees or Affiliates, has employed any
broker, finder or investment banker or incurred any liability for any investment
banking fees, financial advisory fees, brokerage fees or finders' fees in
connection with the transactions contemplated by this Agreement.
Section 4.20 PRODUCTS; WARRANTIES. Except as set forth in SCHEDULE
4.20, no Seller Party makes any express warranties or guaranties outside of the
ordinary course of business as conducted consistently with past practice on its
own behalf as to goods sold or services provided in Relation to the Business. To
the Knowledge of the Seller Parties, no Seller Party has any exposure to
liability under any such warranty beyond that (i) which is in excess of reserves
accrued therefor on the Business Balance Sheets, the Interim Balance Sheets and
on the Closing Date Balance Sheets or (ii) would have a Material Adverse Effect
on the Business.
Section 4.21 COPIES OF DOCUMENTS. Wabtec has made available to GETS
true, correct and complete copies of: (a) the charter documents, bylaws, minute
books and stock books of each Acquired Subsidiary, and those of any Person that
was a predecessor to the Business that is currently operated by such Acquired
Subsidiary; (b) with respect to the Owned Real Property, the deed evidencing the
Sellers' ownership of such property, each mortgage or other encumbrance thereon
(if any) reflected in a written instrument, each instrument (if any) evidencing
a grant by or to any Seller Party of an option to purchase or lease such
property, each lease and leasehold mortgage (if any) with respect to such
property, and any title policies or commitments and surveys with respect to such
property; (c) each of the Material Contracts; (d) each trademark and service
xxxx registration application and patent application included in the Purchased
Assets; (e) the pleadings and briefs filed in each pending Action listed in the
Schedules and any judgments, orders, injunctions, decrees, stipulations and
awards listed therein; (f) all files pertaining to environmental matters that
Relate to the Business; (g) each employment agreement, term sheet or other
document listed on SCHEDULE 7.1; and (h) the plan summaries, summary plan
descriptions or, if there is no summary or summary plan description, a written
description of, each Seller Benefit Plan and ERISA Affiliate Plan.
Notwithstanding the above, Wabtec's making such documents available does not
alone constitute adequate disclosure of those facts required to be disclosed on
any Schedule to this Agreement, and notice of their
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contents (other than by express reference on a Schedule) will in no way limit
the Seller Parties' other obligations or the Buyers' other rights under this
Agreement.
ARTICLE V.
REPRESENTATIONS AND WARRANTIES OF BUYERS
Each Buyer hereby jointly and severally represents and warrants to the
Seller Parties as follows:
Section 5.1 ORGANIZATION. Each Buyer is a corporation duly organized,
validly existing and in good standing under the laws of the jurisdiction set
forth in the introductory paragraph of this Agreement and has all requisite
corporate power and authority to own, lease and operate its properties and to
carry on its business as now being conducted, except where the failure to be so
qualified would not be material.
Section 5.2 AUTHORIZATION. Each Buyer has full corporate power and
authority to execute and deliver this Agreement and any other certificate,
agreement, document or other instrument to be executed and delivered by it in
connection with the transactions contemplated by this Agreement (collectively,
the "Buyer Ancillary Documents"), to perform its obligations under this
Agreement and the Buyer Ancillary Documents and to consummate the transactions
contemplated by this Agreement and the Buyer Ancillary Documents. The execution
and delivery of this Agreement and the Buyer Ancillary Documents by each Buyer,
the performance by each Buyer of its obligations under this Agreement and the
Buyer Ancillary Documents, and the consummation of the transactions provided for
in this Agreement and the Buyer Ancillary Documents have been duly and validly
authorized by all necessary corporate action on the part of each Buyer. This
Agreement has been and, as of the Closing, the Buyer Ancillary Documents will
be, duly executed and delivered by the each Buyer and do or will, as the case
may be, constitute the valid and binding agreements of each Buyer, enforceable
against such Buyer in accordance with their respective terms.
Section 5.3 ABSENCE OF RESTRICTIONS AND CONFLICTS. The execution, delivery and
performance of this Agreement and the Buyer Ancillary Documents, the
consummation of the transactions contemplated by this Agreement and the Buyer
Ancillary Documents and the fulfillment of and compliance with the terms and
conditions of this Agreement and the Buyer Ancillary Documents do not or will
not, as the case may be, with the passing of time or the giving of notice or
both, violate or conflict with, constitute a breach of or default under, result
in the loss of any benefit under, or permit the acceleration of any obligation
under, (a) any term or provision of the charter documents of either Buyer, (b)
any material contract to which either Buyer is a party, (c) any judgment, decree
or order of any Governmental Entity to which either Buyer is a party or by which
either Buyer or any of its properties is bound or (d) any Applicable Law, except
for compliance with the applicable requirements of the Antitrust Acts.
Section 5.4 BROKERS, FINDERS AND INVESTMENT BANKERS. No Buyer, nor any
its officers, directors, employees or Affiliates, has employed any broker,
finder or investment banker or incurred any liability for any investment banking
fees, financial advisory fees, brokerage fees or finders' fees in connection
with the transactions contemplated by this Agreement.
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ARTICLE VI.
CERTAIN COVENANTS AND AGREEMENTS
Section 6.1 CONDUCT OF BUSINESS BY THE SELLER PARTIES. From the date
hereof until the Closing, each Seller Party shall, except as required in
connection with the transactions contemplated by this Agreement and except as
otherwise consented to in writing by GETS, conduct the Business in the ordinary
course on a basis consistent with past practice and not enter into any
agreement, transaction or activity or make any commitment affecting the Business
or the Purchased Assets except those in the ordinary course of business and not
otherwise prohibited under this Section 6.1. By way of illustration and not in
limitation of the foregoing, each Seller Party agrees that it will do (or cause
to be done) the following:
(a) use its commercially reasonable efforts to preserve intact
the goodwill and business organization of the Business, keep the employees of
the Business available to Buyers and preserve the relationships and goodwill of
the Seller Parties with customers, distributors, suppliers, employees and others
having business relations with the Seller Parties Relating to the Business;
(b) maintain its existence and good standing in its
jurisdiction of organization and in each jurisdiction in which the ownership or
leasing of the Purchased Assets or the conduct of the Business, requires such
qualification, except where failure to maintain such qualification would not
have a Material Adverse Effect;
(c) duly and timely file or cause to be filed all reports and
returns required to be filed with any Governmental Entity and promptly pay or
cause to be paid when due all Taxes, assessments and governmental charges,
including interest and penalties levied or assessed, unless diligently contested
in good faith by appropriate proceedings;
(d) except as applicable to federal or state foreign or
domestic taxes based on income, not enter into any closing agreements, Tax
sharing agreements, Tax Return extensions, extensions of statutes of limitations
or request or secure any rulings or similar agreements with any Tax authority or
other party involving Taxes;
(e) maintain in existing condition and repair (ordinary wear
and tear excepted), consistent with past practices, all buildings, offices,
shops and other structures located on the Real Property, all personal property
and all other material equipment, fixtures and other tangible personal property
Relating to the Business, including all Acquired Subsidiary Assets;
(f) not authorize for issuance, issue and deliver any
additional shares of capital stock of any Acquired Subsidiary, or securities
convertible into or exchangeable for shares of such capital stock, or issue or
grant any right, option or other commitment for the issuance of shares of such
capital stock or of such securities, or split, combine or reclassify any shares
of such capital stock;
(g) not amend or modify the charter documents of any Acquired
Subsidiary;
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(h) with respect to any Acquired Subsidiary, not declare any
dividend payable in property other than cash, pay or set aside for payment any
dividend or other distribution in respect of shares of property other than cash;
(i) with respect to any Acquired Subsidiary, not create any
subsidiary, acquire any capital stock or other equity securities of any
corporation or acquire any equity or ownership interest in any other Person;
(j) not sell, transfer or assign any interests in any Seller
Party other than Wabtec and Wabtec Holding Corp., or otherwise fail to maintain
control of any Seller Party over which it has control as of the date hereof;
(k) not dispose of or permit to lapse any rights to the use of
any Seller Intellectual Property, or dispose of or disclose to any Person, any
Trade Secret, Confidential Information or know-how of the Business not
heretofore a matter of public knowledge, except in the ordinary course of
business consistent with past practice;
(l) not (i) sell any Purchased Assets other than in the
ordinary course of business consistent with past practice, (ii) create, incur or
assume any indebtedness secured by the Purchased Assets, (iii) grant, create,
incur or suffer to exist any Liens on the Purchased Assets that did not exist on
the date hereof, other than by the Acquired Subsidiaries pursuant to a line of
credit in an aggregate amount not to exceed 2 million Mexican pesos, (iv) other
than Permitted Liens, incur any material liability or obligation (absolute,
accrued or contingent) in any way affecting the Business or the Purchased
Assets, except in the ordinary course of business consistent with past practice
and other than by the Acquired Subsidiaries pursuant to a line of credit in an
aggregate amount not to exceed 2 million Mexican pesos, (v) write-off any
material guaranteed checks, notes or accounts receivable Relating to the
Business except in the ordinary course of business consistent with past
practice, (vi) materially write-down the value of any asset (including, without
limitation, any of the Purchased Assets) on its books or records, except for
depreciation and amortization in the ordinary course of business and consistent
with past practice, (vii) cancel any debt Relating to the Business or waive any
claims or rights Relating to the Business, (viii) make any commitment Relating
to the Business for any capital expenditure to be made on or after the Closing
in excess of $250,000 in the case of any single expenditure or $1,000,000 in the
case of all capital expenditures; (ix) sell or factor any accounts receivable
Related to the Business (other than accounts receivable that constitute Excluded
Assets), with or without recourse; or (x) enter into any contract or agreement
Relating to the Business with a term greater than twelve (12) months and
involving the receipt or payment of more than $1,000,000 in any 12-month period
without the written consent of GETS;
(m) not increase in any manner the base compensation of, or
enter into any new bonus or incentive agreement or arrangement with, any of its
employees, directors or consultants that are employed in Relation to the
Business, or promise or commit to do any of the foregoing, except in the
ordinary course of business consistent with past practice;
(n) not adopt, amend or terminate any Seller Benefit Plan or
increase the benefits provided under any Seller Benefit Plan which covers or
affects any employee or consultant of the Business, except as provided under
such Seller Benefit Plan;
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(o) except in the ordinary course of business consistent with
past practice, not amend or terminate any existing employment, severance,
consulting, or other compensation agreement or enter into any new employment,
severance, consulting or other compensation agreement with respect to the
current or former employees or consultants of the Business;
(p) continue to extend customers Relating to the Business
credit, collect accounts receivable and pay accounts payable and similar
obligations in the ordinary course of business consistent with past practice;
(q) (i) perform in all material respects all of the
obligations Relating to the Business under, and not default or suffer to exist
any event or condition which with notice or lapse of time or both would
constitute a default under, any Material Contract (except those being contested
in good faith); (ii) not materially amend any Material Contract, and (iii) not
enter into or assume any other contract or commitment of the type described in
Section 4.11(a);
(r) not pay, discharge or satisfy any material claim,
liability or obligation (absolute, contingent or otherwise) Relating to the
Business other than the payment, discharge or satisfaction in the ordinary
course of business consistent with past practice of claims, liabilities and
obligations reflected or reserved against in the March 2000 Balance Sheets or
incurred in the ordinary course of business consistent with past practice after
the date thereof;
(s) except in the ordinary course of business consistent with
past practice, not increase any reserves for contingent liabilities Relating to
the Business;
(t) maintain in full force and effect and in the same amounts
policies of insurance Relating to the Business comparable in amount and scope of
coverage to that now maintained by or on behalf of any Seller Party;
(u) continue to maintain the books and records Relating to the
Business in accordance with GAAP and on a basis consistent with past practice;
(v) continue the cash management practices Relating to the
Business in the ordinary course of business consistent with past practice; and
(w) not authorize, promise, commit or agree to do (or cause to
be done), any of the foregoing actions.
In connection with the continued operation of the Business between the date
hereof and the Closing Date, each Seller Party will confer in good faith with
one or more representatives of Buyers designated to Wabtec regarding the general
status of ongoing operations on a regular basis and will notify Buyers of any
event or occurrence that has had or may reasonably be expected to have a
Material Adverse Effect on the Business. Each Seller Party acknowledges that
Buyers do not and will not waive any rights they may have under this Agreement
as a result of such consultations. No Seller Party shall take any action that
would, or that could reasonably be expected to, result in any of the
representations and warranties of the Seller Parties set forth in this Agreement
becoming untrue.
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Section 6.2 INSPECTION AND ACCESS TO INFORMATION; CONFIDENTIAL
INFORMATION.
(a) From the date of this Agreement to the Closing Date, each
Seller Party shall (i) provide Buyers and their designees with such information
as they may from time to time reasonably request with respect to the Business,
the Acquired Subsidiaries, the Purchased Assets, the Acquired Subsidiary Assets,
the Assumed Liabilities and the transactions contemplated by this Agreement,
(ii) provide Buyers and their designees, officers, counsel, accountants, outside
environmental consultants (including, without limitation, the Environmental
Consultant), actuaries, and other authorized representatives access during
regular business hours and upon reasonable notice to the Purchased Assets, the
Acquired Subsidiary Assets and the Real Property, and the books, records,
offices, personnel, counsel, accountants and actuaries of the Business as Buyers
or their designees may from time to time reasonably request, and (iii) permit
the Environmental Consultant to conduct the Environmental Reviews and permit
Buyers and their designees to make such other inspections thereof as Buyers may
reasonably request. Any investigation shall be conducted in such a manner so as
not to interfere unreasonably with the operation of the business of any Seller
Party. No such investigation (or any disclosure made at any time by any Seller
Party to Buyers) shall limit or modify in any way, or act or result in a waiver
of, the Seller Parties' obligations with respect to any breach of their
representations, warranties, covenants or agreements contained herein
(including, without limitation, conditions to Closing or indemnification
obligations).
(b) After the Closing, each Seller Party will hold, and will
use its commercially reasonable efforts to cause any other Wabtec Group Member,
and the officers, directors, employees, accountants, counsel, consultants,
advisors and agents of the Wabtec Group Members, to hold, in confidence, unless
compelled to disclose by judicial or administrative process or by other
requirements of law, all Confidential Information and Trade Secrets Relating to
the Business, except to the extent that such information can be shown to have
been (i) previously known on a nonconfidential basis by any Wabtec Group Member,
(ii) in the public domain through no fault of any Wabtec Group Member or (iii)
later lawfully acquired by any Wabtec Group Member from sources other than those
related to its prior ownership of the Business or the Acquired Subsidiaries. The
obligation of each Seller Party, the other Wabtec Group Members and the
officers, directors, employees, accountants, counsel, consultants, advisors and
agents of the Wabtec Group Members to hold any such information in confidence
shall be satisfied if they exercise the same care with respect to such
information as they would take to preserve the confidentiality of their own
similar information.
(c) After the Closing, each Seller will promptly afford to
Buyers and their agents reasonable access to its books of account, financial and
other records (including, without limitation, accountant's work papers),
information, employees and auditors Relating to the Business, to the extent
necessary or useful for Buyers in connection with any audit, investigation,
dispute or litigation or any other reasonable business purpose Relating to the
Business but not otherwise readily available to Buyers; provided, however, that
any such access by Buyers shall not unreasonably interfere with the conduct of
the business of such Seller. Buyers shall bear all of the out-of-pocket costs
and expenses (including, without limitation, attorneys' fees, but excluding
reimbursement for general overhead, salaries and employee benefits) reasonably
incurred in connection with the foregoing.
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Section 6.3 NOTICES OF CERTAIN EVENTS.
(a) Wabtec shall promptly notify GETS of:
(i) any notice or other communication from any Person
alleging that the consent of such Person is or may be required in
connection with the transactions contemplated by this Agreement;
(ii) any Actions that become pending or, to the Knowledge
of the Seller Parties, are threatened against, relating to or involving
or otherwise affecting any Seller Party or the Business that, if
pending on the date of this Agreement, would have been required to have
been disclosed pursuant to Section 4.9 or that relate to the
consummation of the transactions contemplated by this Agreement; and
(iii) the damage or destruction by fire or other casualty
of any material portion of the Purchased Assets or in the event that
any material portion of the Purchased Assets becomes the subject of any
proceeding or, to the Knowledge of the Seller Parties, threatened
proceeding for the taking thereof or any part thereof or of any right
relating thereto by condemnation, eminent domain or other similar
governmental action.
(b) Each Party shall promptly notify each other Party of any
notice or other communication from any Governmental Entity in connection with
the transactions contemplated by this Agreement.
Section 6.4 INTERIM FINANCIAL STATEMENTS. As promptly as practicable
after each quarter after March 31, 2001 and prior to the Closing Date, Wabtec
will deliver to GETS quarterly financial reports in the form that it customarily
prepares for its internal purposes concerning the Business, and, if available,
balance sheets for each Division of the Business as of the last day of such
quarter, and the related statement of income for the period then ended. In
addition, Wabtec will deliver to GETS any monthly balance sheet and income
statements prepared by Wabtec in the ordinary course of business for internal
purposes concerning the Business promptly after such statements are prepared;
provided, however, that the Seller Parties make no representations or
warranties, expressed or implied, with respect to such monthly balance sheet and
income statements.
Section 6.5 NO SOLICITATION OF TRANSACTIONS. From the date hereof
until the earlier of the Closing or termination of this Agreement under Article
XI, no Seller Party will, nor shall it authorize or permit any of its
Affiliates, any of its directors, officers, employees, advisors or agents or
other representatives, or those of its Affiliates to, directly or indirectly:
(a) solicit, initiate or encourage the submission of, or enter into any
agreement or understanding with respect to any Acquisition Proposal or (b)
participate in, engage in or encourage any discussions or negotiations
regarding, or furnish to any person any non-public information with respect to,
or take any other action to assist or facilitate, any inquiries or the making of
any proposal that constitutes, or could reasonably be expect to lead to, any
Acquisition Proposal. The Seller
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Parties will promptly suspend or terminate any negotiations or discussions with
any other Person with respect to any Acquisition Proposal.
Section 6.6 REASONABLE EFFORTS; FURTHER ASSURANCES; COOPERATION.
Subject to the other provisions of this Agreement, the Parties will each use
their reasonable, good faith efforts to perform their obligations in this
Agreement and to take, or cause to be taken, and do, or cause to be done, all
things necessary and commercially reasonable under Applicable Law to obtain all
consents required as described on SCHEDULE 2.1(h) and all regulatory approvals
and to satisfy all conditions to their respective obligations under this
Agreement and to cause the transactions contemplated in this Agreement to be
effected on or prior to December 31, 2001, in accordance with the terms of this
Agreement and will cooperate fully with each other and their respective
officers, directors, employees, agents, counsel, accountants and other designees
in connection with any steps required to be taken as a part of their respective
obligations under this Agreement, including, without limitation:
(a) Each Party will promptly make its respective filings and
submissions pursuant to, and will furnish all information required by and take
all actions necessary, proper or advisable under, any Applicable Law to obtain
any required approval of any Governmental Entity with jurisdiction over the
transactions contemplated by this Agreement (except that the Parties shall have
no obligation to take or consent to the taking of any action required by any
such Governmental Entity that could adversely affect the Business, the Purchased
Assets or the transactions contemplated by this Agreement or the Buyer Ancillary
Documents or Seller Ancillary Documents, as the case may be). Each Party will
furnish to each other Party, in advance of filing, copies of all such filings
and submissions, except as prohibited by Applicable Law.
(b) Buyers and Sellers shall assist each other in obtaining
all material Permits, approvals and variances required (i) for Buyers to operate
the Business and the Purchased Assets as currently operated and in compliance
with all Applicable Laws, including, without limitation, Environmental Laws, and
(ii) to transfer the Owned Real Property to Buyers at the Closing as
contemplated by this Agreement.
(c) In the event any Action by any Governmental Entity or
other Person is commenced which questions the validity or legality of the
Acquisition or any of the other transactions contemplated by this Agreement or
seeks damages in connection therewith, the Parties agree to cooperate and use
all reasonable efforts to defend against such claim, action, suit, investigation
or other proceeding and, if an injunction or other order is issued in any such
action, suit or other proceeding, to use all reasonable efforts to have such
injunction or other order lifted and to cooperate reasonably regarding any other
impediment to the consummation of the transactions contemplated by this
Agreement.
(d) Each Seller Party will give any notices to third parties
and use its commercially reasonable efforts (in consultation with Buyers) to
obtain any third party consents (i) necessary, proper or advisable to consummate
the transactions contemplated by this Agreement, (ii) disclosed or required to
be disclosed in the Schedules to this Agreement, including, without limitation,
the consents described in SCHEDULE 2.1(h), (iii) required to avoid a breach of
or default by any Seller Party under any Material Contracts in connection with
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the consummation of the transactions contemplated by this Agreement or (iv)
required to prevent a Material Adverse Effect on the Business caused by a breach
or default of any Material Contract by any Seller Party, whether prior to or
after the Closing.
(e) The Parties will give prompt notice to the other Parties
of (i) the occurrence, or failure to occur, of any event which occurrence or
failure would be likely to cause any representation or warranty of any Seller
Party or Buyer, as the case may be, contained in this Agreement to be untrue or
inaccurate at any time from the date hereof to the Closing Date or that will or
may result in the failure to satisfy any of the conditions specified in Article
X of this Agreement and (ii) any failure of any Seller Party or Buyer, as the
case may be, to comply with or satisfy any covenant, condition or agreement to
be complied with or satisfied by any of them under this Agreement.
Section 6.7 PUBLIC ANNOUNCEMENTS. Except to the extent disclosure is
otherwise required by Applicable Law, the Parties agree to obtain the consent of
the other Party prior to making any announcement regarding any aspect of this
Agreement or the transactions contemplated hereby to the financial community,
Governmental Entities, employees, customers or the general public.
Section 6.8 INSURANCE. If requested by Buyers, the Seller Parties shall in good
faith cooperate with Buyers and take all actions reasonably requested by Buyers
that are necessary or desirable to permit Buyers to have available to it
following the Closing the benefits (whether direct or indirect) of the insurance
policies maintained by or on behalf of any Seller Party Relating to the Business
that are currently in force. All costs relating to the actions described in this
Section shall be borne by Buyers.
Section 6.9 NON-COMPETITION; NON-SOLICITATION.
(a) Sellers acknowledge that Wabtec and MotivePower, Inc.
currently conduct the Restricted Activities throughout the Territory. Sellers
acknowledge that to protect adequately the interest of Buyers in the Business
following the Closing, it is essential that any noncompete covenant with respect
thereto cover Sellers and any other Wabtec Group Member existing at any time
after the Closing (collectively, the "Restricted Parties") with respect to all
Restricted Activities and the entire Territory. Accordingly, except as permitted
pursuant to Section 6.9(b), each Seller shall not, and shall cause any other
Restricted Party not to, during the Noncompete Period, in any manner, directly
or indirectly or by assisting others, engage in, have an equity or profit
interest in, or render services (of an executive, marketing, manufacturing,
research and development, administrative, financial or consulting nature) to any
business that conducts, any of the Restricted Activities in the Territory.
(b) Notwithstanding Section 6.9(a):
(i) if any Person listed on SCHEDULE 6.9(b) (each, a
"Competing Acquirer") acquires MotivePower, Inc., MotivePower, Inc.
shall promptly notify GETS of the same and GETS shall have the right,
upon six months prior written notice to Wabtec, to terminate the Supply
and Marketing Agreement; provided, however, that the marketing
provisions of the Supply and
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Marketing Agreement shall terminate immediately upon GETS' written
notice to Wabtec of its intent to terminate such agreement and
provided, further, that for (x) uncompleted orders at MotivePower,
Inc.; (y) work quoted by MotivePower, Inc. in writing as of the Closing
Date; and (z) options with respect to purchase orders, contracts or
quotes described in clauses (x) or (y) identified to GETS in writing as
of the Closing Date, GETS shall continue to supply products pursuant to
the terms and conditions of the Supply and Marketing Agreement and the
IP Development and License Agreement shall continue until the
completion of such projects. The obligations and covenants in Section
6.9(a) shall continue solely with respect to the physical assets and
intangible property of Wabtec, but shall not apply to any Competing
Acquirer.
(ii) if a Competing Acquirer acquires Wabtec, Wabtec shall
promptly notify GETS of the same and GETS shall have the right, upon
six months prior written notice to Wabtec, to terminate (A) the
Component Purchase Agreement attached hereto (the "Components Purchase
Agreement") and/or (B) the Supply and Marketing Agreement; provided,
however, that the marketing provisions of the Supply and Marketing
Agreement shall terminate immediately upon GETS' written notice to
Wabtec of its intent to terminate such agreement and provided, further,
that for (x) uncompleted orders at MotivePower, Inc.; (y) work quoted
by MotivePower, Inc. in writing; and (z) options with respect to
purchase orders, contracts or quotes described in clauses (x) or (y)
identified to GETS in writing, GETS shall continue to supply products
pursuant to the terms and conditions of the Supply and Marketing
Agreement and the IP Development and License Agreement shall continue
until the completion of such projects. The obligations and covenants in
Section 6.9(a) shall continue solely with respect to the physical
assets and intangible property of Wabtec, but shall not apply to any
Competing Acquirer.
(iii) If any Person not listed on SCHEDULE 6.9(b) acquires
Wabtec or MotivePower, Inc., then the Component Purchase Agreement and
the Supply and Marketing Agreement shall remain in full force and
effect, and the obligations and covenants in Section 6.9(a) shall
continue solely with respect to the physical assets and intangible
property of Wabtec, but shall not apply to any acquirer.
(iv) If Wabtec or MotivePower, Inc. acquires an entity
that engages in business activities that constitute Restricted
Activities but such activities generate $10 million or less in revenues
for the twelve months prior to the closing of the acquisition, Wabtec
or MotivePower, Inc., as the case may be, shall not be in violation of
the obligations and covenants in Section 6.9(a) by reason of the
acquisition or operation of the entity thereafter.
(v) If Wabtec or MotivePower, Inc. acquires an entity that
engages in business activities that constitute Restricted Activities
and such activities generate over $10 million in revenues for the
twelve months prior to the closing of the acquisition, then Wabtec
shall notify GETS of the same, and
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Wabtec or MotivePower, Inc., as the case may be, shall not be in
violation of the obligations and covenants in Section 6.9(a) by reason
of the acquisition or operation of the entity thereafter provided that:
(A) if, within six months of the closing of such
acquisition, Wabtec or MotivePower ceases to operate the
portion of the newly acquired business that engages in
Restricted Activities; or
(B) if, at the time of the closing of such
acquisition, Wabtec or MotivePower, Inc. has an executed
letter of intent or purchase agreement pursuant to which
Wabtec or MotivePower, Inc., as the case may be, has agreed to
dispose of the entire portion of the newly-acquired business
or substantially all of the portion of the newly-acquired
business that engages in Restricted Activities (the "Competing
Business"), and Wabtec or MotivePower, Inc., as the case may
be, disposes of the Competing Business within six months of
the closing of the initial acquisition; or
(C) if, at the time of the closing of such
acquisition, Wabtec or MotivePower, Inc. does not have an
executed letter of intent or purchase agreement pursuant to
which Wabtec or MotivePower, Inc. has agreed to dispose of the
Competing Business, and, prior to selling such Competing
Business to any third Person, Wabtec first offers to sell such
Competing Business to GETS at a price and upon terms and
conditions determined by Wabtec in good faith taking into
consideration then current market and commercial conditions.
GETS shall notify Wabtec in writing within five business days
of GETS' intention to purchase the Competing Business at such
price and upon such terms and conditions. If GETS elects not
to purchase the Competing Business, GETS shall notify Wabtec
of the same in writing within five business days of GETS'
receipt of such notice, then Wabtec or MotivePower, Inc., as
the case may be, shall have six months from the date of such
notice to sell the Competing Business to a third Person or
cease the conduct of Restricted Activities by the Competing
Business, during which time Wabtec and MotivePower, Inc. shall
not be in violation of the obligations and covenants in
Section 6.9(a). If GETS elects to purchase the Competing
Business, then Wabtec and MotivePower, Inc. shall not be in
violation of the obligations and covenants in Section 6.9(a)
while GETS and Wabtec negotiate a definitive purchase
agreement and close the transaction, provided, however, that
if such negotiations or purchase agreement are terminated by
either party, then Wabtec and MotivePower, Inc. shall not be
in violation of the covenants and obligations in Section
6.9(a) if Wabtec or MotivePower, Inc., as the case may be,
sells the Competing Business or ceases the conduct of
Restricted Activities by the Competing Business within six
months of such termination.
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(vi) If Wabtec disposes of a division, subsidiary,
affiliate or other operation, the provisions of Section 6.9(a) shall
not apply to such division, subsidiary, affiliate or other operation
subsequent to disposition thereof by Wabtec.
(vii) To the extent MotivePower, Inc. is engaging in
activities described in clauses (x), (y) or (z) of Section 6.9(b)(i) on
the Closing Date, MotivePower, Inc. shall not be in violation of the
obligations and covenants in Section 6.9(a) while MotivePower, Inc.
completes such work in accordance with the terms of the applicable
purchase order, contract, quote or bid, as the case may be.
(c) Each Seller hereby agrees that it shall not, and shall
cause any other Restricted Party not to, prior to the second anniversary of the
Closing Date, in any manner, directly or indirectly or by assisting others,
recruit or hire away or attempt to recruit or hire away, on their behalf or on
behalf of any other Person, any employee of the Business (other than the
employees listed on SCHEDULE 7.4 and employees of the Business who are
discharged by Buyers after the Closing Date).
(d) If a judicial determination is made that any of the
provisions of this Section 6.9 constitutes an unreasonable or otherwise
unenforceable restriction against any Restricted Party, the provisions of this
Section 6.9 shall be rendered void only to the extent that such judicial
determination finds such provisions to be unreasonable or otherwise
unenforceable with respect to such Restricted Party. In this regard, the Parties
hereby agree that any judicial authority construing this Agreement shall be
empowered to sever any portion of the Territory, any prohibited business
activity or any time period from the coverage of this Section 6.9 and to apply
the provisions of this Section 6.9 to the remaining portion of the Territory,
the remaining business activities and the remaining time period not so severed
by such judicial authority. Sellers agree that Buyers' election to pursue any of
its equitable remedies provided in this Section 6.9 for any Restricted Party's
violation of this Section 6.9, including the remedy of specific enforcement,
shall not preclude Buyer from recovering monetary damages as a result of such
violation. The time period during which the prohibitions set forth in this
Section 6.9 shall apply shall be tolled and suspended for a period equal to the
aggregate time during which any Restricted Party violates such prohibitions in
any respect unless monetary damages are recovered by Buyers as a result of such
violation.
(e) Any remedy at law for any breach of the provisions
contained in this Section 6.9 shall be inadequate and Buyers shall be entitled
to injunctive relief in addition to any other remedy Buyers might have under
this Agreement.
Section 6.10 TRADEMARKS, TRADENAMES AND OTHER INTELLECTUAL PROPERTY
MATTERS.
(a) Promptly after the Closing Date, each Wabtec Group Member
shall change its corporate name to remove any reference to the following trade
names included in the Purchased Assets: "Power Parts," "Engine Systems," "Motor
Coils," "G&G," "G&G Locotronics," "Maxitrax" and "Xxxxx." Subject to the
provisions of Section 6.10(b), Sellers specifically retain and reserve all
rights to any Wabtec Group Member may have to the trade
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names "MotivePower" and "MPI" and all uses thereof. As promptly as practicable
after the Closing Date, Sellers shall file in all jurisdictions in which it is
qualified to do business any documents necessary to reflect such change of name
or to terminate its qualification therein. In connection with enabling Buyers,
at or as soon as practicable after the Closing Date, to use the current
corporate name of Sellers, Sellers shall, at or prior to the Closing Date,
execute and deliver to Buyers all consents related to such change of name as may
be requested by Buyers, and will otherwise cooperate with Buyers.
(b) Except as set forth in this Section 6.10, after the
Closing, Buyers shall not use any of the marks or names of any Wabtec Group
Member not included in the Purchased Assets (the "Seller Trademarks and
Tradenames"). After the Closing, Buyers shall have the limited right to dispose
of then-existing inventory and to use then-existing packaging, labeling,
containers, supplies, advertising materials, technical data sheets and any
similar materials that constitute part of the Purchased Assets and bear any
Seller Trademarks and Tradenames. All such inventory that bears any Seller
Trademarks and Tradenames shall be disposed of within twelve months after the
Closing Date. Buyers shall comply with all Applicable Laws in any use of
packaging or labeling containing Seller Trademarks and Tradenames. Buyers shall
not be obligated to change the Seller Trademarks and Tradenames on any goods in
the hands of dealers, distributors or customers as of the Closing. Buyers agree
to use commercially reasonable efforts to cease using Seller Trademarks and
Tradenames on buildings, cars, trucks and other fixed assets as soon as possible
within a period not to exceed twelve months after the Closing Date. In addition,
Buyers will have the limited right to use the names "MotivePower" and "MPI" in
connection with the Business in Mexico for a period of two years after the
Closing Date.
(c) Sellers shall in good faith provide to Buyers, at the cost
and expense of Buyers, reasonable assistance in perfecting title in and to all
Seller Intellectual Property included in the Seller Purchased Assets in the name
of the applicable Buyer or its nominee and do all other things reasonably
necessary, proper or advisable under Applicable Law to document and perfect the
change in ownership of such Seller Intellectual Property. From and after the
date hereof for a period of two years after the Closing Date, Sellers shall not,
and shall cause any other Restricted Party not to, actively solicit business or
form or register any Person in Mexico using the name "MotivePower" or "MPI."
(d) At the Closing, Sellers shall grant Buyers a royalty-free,
perpetual, non-exclusive right and license (with right of assignment) to any
Intellectual Property not Related to the Business, but needed to conduct the
Business as presently conducted for use by Buyers (and their successors) within
GETS in the performance of the Business after the Closing.
Section 6.11 RISK OF LOSS. The risk of loss with respect to the
Purchased Assets shall remain with Sellers or the Acquired Subsidiaries, as the
case may be, until Closing. If before the Closing any of the Purchased Assets
are lost, damaged or destroyed and the loss, damage or destruction has or would
reasonably be expected to have a Material Adverse Effect on the Business, then:
(a) Buyers may terminate this Agreement in accordance with the
provisions of Section 11.1(d); or
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(b) Buyers may require Sellers to assign to Buyers the
proceeds of any insurance payable as a result of the occurrence of such loss,
damage or destruction and to reduce the Purchase Price by the amount of the
replacement cost of the Purchased Assets that were lost, damaged or destroyed
less the amount of any proceeds of insurance payable as a result of the
occurrence.
Section 6.12 TRANSITIONAL SERVICES.
(a) Buyers and the Sellers acknowledge that certain
administrative operations of the Seller Parties relate to or are used by both
the Business and Sellers' other businesses. Certain of such operations will be
acquired by Buyers pursuant to the Acquisition, while other such operations will
be retained by Sellers. In order to promote the orderly transition of the
Business from the Seller Parties to Buyers, to the extent requested in writing
prior to the Closing by Buyers, on the one hand, or Sellers, on the other hand:
(a) Sellers shall continue to provide for Buyers those services that are
reasonably necessary for Buyers to conduct the Business following the Closing,
including, without limitation, those services set forth on SCHEDULE 6.12(a), and
(b) Buyers shall provide those services for Sellers that are reasonably
necessary for Sellers to conduct their other businesses following the Closing,
including, without limitation, those services set forth on SCHEDULE 6.12(b)
(collectively, the "Transitional Services"). Each Party's obligation to provide
Transitional Services shall terminate twelve months after the Closing Date or
such earlier time as the Party receiving such services can assume responsibility
therefor in an orderly manner. The Party receiving Transitional Services shall
reimburse the Party providing such services for the costs and expenses
reasonably incurred in providing such services (including, without limitation,
an hourly fee for each employee who provides Transitional Services); provided,
however, that such costs and expenses shall not include any fee, service charge
or other profit consideration.
Section 6.13 IP DEVELOPMENT AND LICENSE AGREEMENT. At the Closing,
GETS and Wabtec shall enter into an Intellectual Property Development and
Licensing Agreement substantially in the form attached hereto as EXHIBIT 6.13
(the "IP Development and License Agreement"), pursuant to which GETS shall
license Wabtec certain Tier 0 and Tier 1 emissions technology on the terms and
conditions set forth on EXHIBIT 6.13 hereto.
Section 6.14 ENVIRONMENTAL MATTERS.
(a) Promptly after the execution hereof, Wabtec will engage an
environmental consulting firm reasonably acceptable to GETS (the "Environmental
Consultant") to perform Phase II environmental and safety reviews of the
Business (and any further reviews deemed reasonably necessary by GETS in light
of the results of the Phase II environmental and safety reviews, which further
reviews Wabtec shall have the right to reasonably approve) at the following
locations: Elk Grove Village, Illinois; Emporium, Pennsylvania; Xxxxxx, New
York; and San Xxxx Potosi and Acambaro, Mexico (collectively, the "Environmental
Reviews"). Wabtec will not change the Environmental Consultant without GETS'
prior written approval. The scope of the Environmental Reviews, including all
procedures, methods, tests and approaches utilized in connection therewith,
shall be in accordance with standard procedures and scope and professional
practices for such reviews, and shall be approved by GETS, provided that such
approval will not be unreasonably withheld. During the Environmental Reviews,
GETS
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and its outside environmental consultants shall be permitted to participate in
and discuss with the Environmental Consultant the Environmental Reviews so as to
become informed concerning all matters relating to the Environmental Reviews and
all procedures, methods, tests and approaches being utilized in connection
therewith, provided that Wabtec representatives are included in such discussions
and communications. GETS shall receive copies of all reports prepared by the
Environmental Consultant in connection with the Environmental Reviews. All costs
and expenses relating to the Environmental Reviews, including, without
limitation, the fees and expenses of the Environmental Consultant, shall be
borne by GETS. Upon completion of the Environmental Reviews, the Environmental
Consultant shall issue a report detailing its findings (the "Environmental
Report"). The Environmental Report shall include the Environmental Consultant's
good faith and reasonable estimate (after consultation with GETS and Wabtec) of
(i) the aggregate potential of claims (measured in dollars) by (A) third parties
for personal injury, (B) third parties for off-site property damage, (C) third
parties for on-site personal property damage and (D) Governmental Entities, all
of which relating to the Existing Conditions at the reviewed sites other than
San Xxxx Potosi and Acambaro, Mexico to the extent such third party or
Governmental Entity claims related to San Xxxx Potosi and Acambaro, Mexico sites
are to be satisfied by another Person, whether pursuant to contractual agreement
or otherwise ("Estimated Environmental Claims") and (ii) the aggregate cost and
expense necessary to bring the Existing Conditions of each reviewed site other
than the sites at San Xxxx Potosi and Acambaro, Mexico into compliance with all
applicable Environmental Laws ("Estimated Compliance Costs"). For purposes of
this Section 6.14, Estimated Compliance Costs shall be based upon the lowest
reasonable cost methods for investigation, remediation, removal, corrective
action and/or monitoring permitted by applicable Environmental Laws and as
necessary to comply with applicable Environmental Laws. Any required
remediation, removal, corrective action and/or monitoring shall include the use
of risk-based remedies (including without limitation, natural attenuation
remedies), institutional and/or engineering controls or deed restrictions, if
such remedies or controls have been approved or accepted for general application
by the relevant Governmental Entities in similar situations and provided that
such remedies or controls do not unreasonably restrict or interfere with the
current use of the property. Buyers shall have the right to terminate this
Agreement pursuant to Section 11.1(d) if (x) the Estimated Environmental Claims
equal or exceed $35 million or (y) the Estimated Compliance Costs equal or
exceed $18 million. The Purchase Price shall be reduced by the amount of the
Estimated Compliance Costs (excluding any costs related to occupational safety,
as opposed to environmental, conditions) up to a maximum of $15 million, as set
forth in the Environmental Report and as mutually and reasonably agreed upon by
GETS and Wabtec, each acting in good faith. Upon any such Purchase Price
reduction, the Seller Parties shall have no further obligation for remediation
of on-site environmental conditions.
(b) Wabtec shall in good faith use its commercially reasonable
efforts to obtain from a nationally recognized insurance carrier reasonably
acceptable to GETS a policy of environmental liability insurance with respect to
the Purchased Assets (including the Real Property) that satisfies the following
requirements in all material respects: (i) such policy has a term of twenty (20)
years beginning as of the Closing Date with an aggregate deductible of not
greater than $5 million and a coverage limit not less than $35 million, (ii)
such policy names each Buyer (or its designees) as an additional insured for the
first ten years of its term and as a primary insured for the last ten years of
its term and provides that Wabtec and any of its Affiliates shall be the primary
insureds for the first ten (10) years of its term and as additional
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insureds for the last ten (10) years of its term, and (iii) such policy contains
such other terms and provisions as set forth on SCHEDULE 6.14 (the
"Environmental Insurance Policy"). If Wabtec submits to GETS a copy of any
draft, specimen or form insurance policy received by Wabtec in its effort to
obtain the Environmental Insurance Policy, GETS shall notify Wabtec whether such
draft policy, in GETS' reasonable determination, satisfies (or does not satisfy)
in all material respects the requirements of the previous sentence (including
the reasons it does not satisfy such requirements, if so determined by GETS)
within ten (10) business days after GETS receives the copy of such draft policy.
If the Environmental Insurance Policy is obtained, Wabtec shall pay in full, at
or prior to the Closing Date, all premiums and other costs necessary to maintain
the Environmental Insurance Policy in full force and effect for its entire term.
If Wabtec fails or is unable to obtain the Environmental Insurance Policy by the
time all other conditions to the Closing set forth in Sections 10.1 and 10.2 are
satisfied, (x) the condition to the Closing set forth in Section 10.2(i) shall
be deemed to be waived by Buyers, (y) the Purchase Price shall be reduced by $10
million, and (z) the execution and delivery of the Environmental Indemnity
Agreement shall no longer be a condition of Closing pursuant to Section 9.2(m)
and Section 9.3(b).
Section 6.15 ST. LOUIS BUSINESS. Promptly following the Closing, GETS
and Wabtec shall agree to the procedure for winding up operations at the Seller
Parties' St. Louis, Missouri facility, and the Seller Parties shall begin to
dismantle and prepare for shipping the Purchased Assets located at such facility
(the "St. Louis Assets"). The Seller Parties shall use their commercially
reasonable efforts to cause the St. Louis Assets to be prepared for shipping and
delivery to Buyers ex works within sixty (60) days following the Closing Date.
Buyers shall be entitled to observe and participate in the dismantling and
packaging of the St. Louis Assets so as to become informed concerning all
matters relating to the re-assembly of such assets. During the period between
the Closing and the delivery of the St. Louis Assets, the Seller Parties shall
use their commercially reasonable efforts to maintain the St. Louis Assets in
existing condition and repair, other than ordinary wear and tear and changes in
such condition and repair associated with the dismantling and packaging of such
assets. Notwithstanding anything herein to the contrary, all right and title to,
and of risk of loss of, the St. Louis Assets shall remain with the Seller
Parties until the St. Louis Assets are delivered ex works pursuant to this
Section 6.15. Upon such delivery, Sellers shall deliver to Buyers a good and
sufficient General Conveyance, Assignment and Xxxx of Sale, duly executed by
each applicable Seller Party in a form reasonably acceptable to Wabtec and GETS,
conveying, selling, transferring and assigning to Buyers (or their designees)
title to the St. Louis Assets free and clear of all Liens. The Seller Parties
shall keep Buyers informed as to the readiness for shipping of the St. Louis
Assets. Buyers shall notify the Seller Parties at least five (5) business days
prior to the anticipated delivery date of the location for delivery. Buyers
shall arrange for the transportation of the St. Louis Assets to the delivery
site. All costs and liabilities incurred with respect to the dismantling and
preparation for shipment of the St. Louis Assets shall be borne by the Seller
Parties. All costs and liabilities incurred with respect to the shipping of the
St. Louis Assets from the Seller Parties' current St. Louis site to the
destination provided by Buyers shall be borne by Buyers. All officers,
employees, contractors, agents and other workers associated with the operations
of the St. Louis facility (the "St. Louis Employees") shall remain the officers,
employees, contractors, agents and workers of the Seller Parties, and shall not
be offered employment by Buyers under the provisions of Section 7.4(a). The
Seller Parties shall be solely responsible for all liabilities and obligations
relating to the St. Louis Employees, including those under any collective
bargaining
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agreements or employment agreements relating to the St. Louis Employees or those
related to the termination of the St. Louis Employees; provided, however, that
notwithstanding anything to the contrary contained in this Agreement, Buyers
shall reimburse the Seller Parties for fifty percent of the costs referred to in
this sentence up to a maximum of $450,000 to be paid by Buyers. The Parties
shall work together in good faith using commercially reasonable efforts to cause
the St. Louis Assets to be delivered to the site designated by Buyers as quickly
as possible after the date scheduled for delivery as provided above.
Section 6.16 XXXXXXXX LEASE. Pursuant to a form of lease reasonably
acceptable to Wabtec and GETS (the "Braddock Lease"), Sellers shall lease to
Buyers, on a triple net basis, Sellers' office building located in Braddock,
Pennsylvania for one year for nominal consideration.
Section 6.17 OVERLAPPING AGREEMENTS. With respect to any contract
which relates both to the Business and to a business to be retained by Sellers
for which transfer to Buyer is provided for in this Agreement, only the portion
of such contract which relates to Business shall be transferred to Buyer
immediately prior to or at the Closing, and the rights and obligations under
such contract shall be equitably apportioned between Buyer and Sellers. As
promptly as practicable following the Closing, each Party shall use its
reasonable best efforts to determine whether to (and after such determination,
use its reasonable best efforts to so implement such determination) (a) attempt
to enter into new agreements with the relevant third party relative to the
allocation of rights and responsibilities under that contract, (b) enter into an
agreement between the Parties relative to the assignment of a Party's rights and
the delegation of a Party's duties under that contract, or (c) arrive at some
other form of agreement which maximizes the total benefit to the Parties of the
contract, while equitably apportioning the rights and obligations of the Parties
under the contract.
Section 6.18 FILES AND RECORDS. To the extent that any books, records,
files or papers, whether in hard copy or computer format, relate both to the
Business and to a business to be retained by a Sellers, then the Parties shall
reasonably cooperate such that, promptly following the Closing, subject to
Applicable Law and the receipt of any necessary approvals, the Purchaser obtains
the portion (or copies thereof) of such files and records which relate to the
Business, subject to the right of Sellers to redact any information contained in
such files and records not relating to the Business.
ARTICLE VII.
EMPLOYEE MATTERS
Section 7.1 OFFICERS AND EMPLOYEES. SCHEDULE 7.1 contains a true and
complete list, as of the date hereof, of all of the officers and employees
(whether full-time, part-time or otherwise) and material independent contractors
of the Business, and further identifies those officers and employees by location
and country of employment, and whether such officer's or employee's employment
is governed by a collective bargaining agreement. SCHEDULE 7.1 sets forth each
such person's title or job description, salary/hourly wage, hire date, birth
date and whether such person is full-time or part-time, together with an
appropriate notation next to the name of any officer or other employee on such
list who is subject to any written employment
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agreement. Except as set forth on SCHEDULE 7.1, no Seller Party is a party to or
bound by any contracts, consulting agreements or termination or severance
agreements in respect to any officer, employee or former employee, consultant or
independent contractor Relating to the Business. No Seller Party has received a
claim from any Governmental Entity to the effect that such Seller Party has
improperly classified as an independent contractor any person named on SCHEDULE
7.1. No Seller Party has made any verbal commitments to any such officers,
employees or former employees, consultants or independent contractors with
respect to compensation, promotion, retention, termination, severance or similar
matters in connection with the transactions contemplated by this Agreement.
Except as indicated on SCHEDULE 7.1, all officers and employees of Sellers are
active on the date hereof.
Section 7.2 EMPLOYEE BENEFIT PLANS.
(a) SCHEDULE 7.2(a) contains a true and complete list of each
Seller Benefit Plan, indicating any special Tax status enjoyed by such plan.
(b) Except as set forth in SCHEDULE 7.2(b):
(i) No Seller Benefit Plan is or was subject to Title IV
of ERISA or Section 412 of the Code, nor is any Seller Benefit Plan a
"multiemployer pension plan," as defined in Section 3(37) of ERISA, or
subject to Section 302 of ERISA. No Seller Party has terminated or
withdrawn from or sought a funding waiver with respect to, and, to the
Knowledge of the Seller Parties, no facts exist which could reasonably
be expected to result in a termination or withdrawal from or seeking a
funding waiver with respect to, any Seller Benefit Plan that is subject
to Title IV of ERISA. No Seller Party has incurred, and, to the
Knowledge of the Seller Parties, no facts exist that reasonably could
be expected to result in, liability to any Seller Party as a result of
a termination, withdrawal or funding waiver with respect to a Seller
Benefit Plan.
(ii) Each Seller Benefit Plan has been established,
registered, qualified, invested, operated and administered in all
respects in accordance with its terms and in material compliance with
ERISA, the Code and all other Applicable Law. No Seller Party has
incurred, and, to the Knowledge of the Seller Parties, no facts exist
that reasonably could be expected to result in any material liability
to any Seller Party with respect to any Seller Benefit Plan, including
without limitation, any material liability, Tax, penalty or fee under
ERISA, the Code or any Applicable Law (other than to pay premiums,
contributions or benefits in the ordinary course).
(iii) To the Knowledge of the Seller Parties, no fact or
circumstance exists that could materially adversely affect the
tax-exempt status of a Seller Benefit Plan that is intended to be
tax-exempt. Further, each Seller Benefit Plan intended to be
"qualified" within the meaning of Section 401(a) of the Code and the
trusts maintained thereunder that are intended to be exempt from
Taxation under Section 501(a) of the Code has received a favorable
determination or other letter indicating that it is so qualified.
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(iv) There is no pending or, to the Knowledge of the
Seller Parties, threatened complaint, claim (other than a routine claim
for benefits), proceeding, examination, audit, investigation or other
proceeding or Action of any kind in or before any Governmental Entity
with respect to any Seller Benefit Plan and, to the Knowledge of the
Seller Parties, there exists no state of facts which after notice or
lapse of time or both reasonably could be expected to give rise to any
such material Action or to materially adversely affect the registration
of any Seller Benefit Plan required to be registered.
Section 7.3 LABOR RELATIONS. Except as set forth in SCHEDULE 7.3:
(a) The employees of the Business have not been, and currently
are not, represented by a labor organization or group that was either certified
or voluntarily recognized by any labor relations board, including, without
limitation, the NLRB, or certified or voluntarily recognized by any other
Governmental Entity.
(b) No Seller Party is or has ever been a signatory to a
collective bargaining agreement with any trade union, labor organization or
group in connection with the Business.
(c) No representation election petition or application for
certification has been filed by employees of the Business or is pending with the
NLRB or any other Governmental Entity and no union organizing campaign or other
attempt to organize or establish a labor union, employee organization or labor
organization or group involving employees of any Seller Party Relating to the
Business has occurred in the last twelve (12) months, is in progress or, to the
Knowledge of the Seller Parties, is threatened.
(d) No Seller Party has engaged in the last twelve (12) months
in any unfair labor practice in connection with the Business and there is no
pending or, to the Knowledge of the Seller Parties, threatened labor board
proceeding in connection with the Business of any kind, including any such
proceeding against any Seller Party or any trade union, labor union, employee
organization or labor organization representing the employees of the Business.
(e) As of June 30, 2001, no grievance or arbitration demand or
proceeding in connection with the Business, whether or not filed pursuant to a
collective bargaining agreement, has been filed, is pending or, to the Knowledge
of the Seller Parties, is threatened against any Seller Party.
(f) No labor dispute, walk out, strike, slowdown, hand
billing, picketing, work stoppage (sympathetic or otherwise), or other
"concerted action" involving the employees of the Business has occurred during
the last twelve (12) months, is in progress or, to the Knowledge of the Seller
Parties, has been threatened.
(g) No breach of contract or denial of fair representation
claim in connection with the Business has been filed during the last twelve (12)
months, is pending or, to the Knowledge of the Seller Parties, threatened
against any Seller Party or any trade union, labor union, employee organization
or labor organization representing the employees of the Business.
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(h) No claim, complaint, charge or investigation for unpaid
wages, bonuses, commissions, employment withholding Taxes, penalties, overtime,
or other compensation, benefits, child labor or record keeping violations of the
Business has been filed during the last twelve (12) months, is pending or, to
the Knowledge of the Seller Parties, threatened under the Fair Labor Standards
Act, Xxxxx-Xxxxx Act, Xxxxx-Xxxxxx Act, or Service Contract Act or any other
Applicable Law.
(i) No discrimination or retaliation claim, complaint, charge
or investigation in connection with the Business has been filed during the last
twelve (12) months, is pending or, to the Knowledge of the Seller Parties,
threatened against any Seller Party under the 1866 or 1964 Civil Rights Acts,
the Equal Pay Act, the ADEA, the ADA, the FMLA, the FLSA, ERISA or any other
Applicable Law relating to fair employment practices.
(j) If any Seller Party is a federal or state contractor
obligated to develop and maintain an affirmative action plan, no discrimination
claim, show cause notice, conciliation proceeding, sanction or debarment
proceeding in connection with the Business has been, to the Knowledge of the
Seller Parties, threatened, or filed during the last twelve (12) months or is
pending with the Office of Federal Contract Compliance Programs or any other
federal agency or any comparable state or foreign agency or court and no desk
audit or on-site review is in progress.
(k) No citation has been issued by OSHA against any Seller
Party affecting the Business and no notice of contest, claim, complaint, charge,
investigation, or other administrative enforcement proceeding with respect to
the Business has been filed during the last twelve (12) months, is pending or,
to the Knowledge of the Seller Parties, threatened against any Seller Party
under OSHA or any other Applicable Law relating to occupational safety and
health.
(l) No workers' compensation or retaliation claim, complaint,
charge or investigation has been filed during the last twelve (12) months, is
pending or, to the Knowledge of the Seller Parties, threatened against any
Seller Party relating to employees of the Business.
(m) No investigation or citation of any Seller Party in
connection with the Business has occurred and no enforcement proceeding has been
initiated during the last twelve (12) months, is pending or, to the Knowledge of
the Seller Parties, threatened under any Applicable Law relating to immigration.
(n) The Business has not taken any action that would
constitute a "mass layoff," "mass termination" or "plant closing" within the
meaning of the WARN Act or otherwise trigger notice requirements or liability
under any federal, local, state or foreign plant closing notice or collective
dismissal law.
(o) No wrongful discharge, retaliation, libel, slander or
other claim, complaint, charge or investigation that arises out of the
employment relationship between any Seller Party and employees of the Business
has been filed during the last twelve (12) months, is pending or, to the
Knowledge of the Seller Parties, threatened against any Seller Party under any
Applicable Law.
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(p) The Business has maintained and currently maintains
adequate insurance as required by Applicable Law with respect to workers'
compensation claims and unemployment benefits claims.
(q) The Business is in material compliance with all Applicable
Laws and orders and all contracts or collective bargaining agreements governing
or concerning labor relations, unions and collective bargaining, conditions of
employment, employment discrimination and harassment, wages, hours or
occupations safety and health, including, without limitation, ERISA, the
Immigration Reform and Control Act of 1986, the National Labor Relations Act,
the Civil Rights Acts of 1866 and 1964, the Equal Pay Act, the ADEA, the ADA,
the FMLA, WARN, the Occupational Safety and Health Act, the Xxxxx Xxxxx Act, the
Xxxxx-Xxxxxx Act, the Service Contract Act, Executive Order 11246, FLSA and the
Rehabilitation Act of 1973 and all regulations under such acts (collectively,
the "Labor Laws").
(r) The Business is not liable for any material liabilities,
judgments, decrees, orders, arrearage of wages or Taxes, fines or penalties for
failure to comply with any of the Labor Laws.
(s) Wabtec has provided GETS with a copy of the Seller
Parties' policies for providing employees of the Business leaves of absence
under the FMLA and SCHEDULE 7.3 identifies each employee who is currently on
FMLA leave.
(t) Each Seller Party has paid or accrued all current
assessments in connection with the Business under workers' compensation
legislation, and no Seller Party has been subject to any special or penalty
assessment under such legislation that has not been paid.
Section 7.4 TRANSFERRED EMPLOYEES.
(a) Subject to Section 6.15 and except as set forth on
SCHEDULE 7.4, Buyers shall offer employment commencing on the Closing Date, on
an "at will" basis to all of the employees of Sellers Relating to the Business,
other than the St. Louis Employees, who are not subject to the terms and
conditions of a collective bargaining agreement, at comparable salary, wage and
benefit levels and on such other comparable terms and conditions as such
employees are currently employed by Sellers. (Such employees of the Business who
accept such offers are, as of the Closing Date, referred to herein as
"Non-Collectively Bargained Transferred Employees"). Subject to Section 6.15 and
except as set forth on SCHEDULE 7.4, Buyers shall offer the opportunity of
employment, commencing on the Closing Date to all of the employees of Sellers
Relating to the Business, other than the St. Louis Employees, who are subject to
the terms and conditions of any collective bargaining agreement set forth on
SCHEDULE 7.3, under such terms and conditions of employment that are comparable
to the terms and conditions upon which such employees are employed by the
Sellers. Notwithstanding the above, Buyers may, in their sole discretion, be
substituted for Sellers under, and otherwise assume, as of the Closing Sellers'
collective bargaining agreement with such union (an "Assumed Collective
Bargaining Agreement") and continue the employment of such employees under and
subject to the terms of such Assumed Collective Bargaining Agreement. (Such
collectively-bargained employees of the Business who accept such offers, or
whose employment is continued under an Assumed Collective Bargaining Agreement,
as the case may be, are, as of the Closing Date, referred to
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herein as "Collectively Bargained Transferred Employees." Non-Collectively
Bargained Transferred Employees and Collectively Bargained Transferred Employees
shall collectively be referred to herein as "Transferred Employees.") Except as
provided in this Section, Buyers shall not assume responsibility for or be
substituted for Sellers under any collective bargaining agreement of Sellers
applicable to employees of the Business. No Seller Party will take any action
which could impede, hinder, interfere, or otherwise compete with Buyers' effort
to hire any employee (except for the employees listed on SCHEDULE 7.4) of
Sellers Relating to the Business, and, in fact, the Seller Parties shall
undertake such efforts as may be reasonably requested by Buyers to facilitate
discussions with appropriate union personnel in advance of the Closing Date.
Buyers shall not assume responsibility for any Transferred Employee until such
employee commences employment with Buyers, and in no event shall any Buyer be
considered a successor employer. Buyers shall be responsible for any severance
obligations in respect of any Transferred Employee.
(b) Sellers shall be solely responsible for offering and
providing any continuation coverage required under Section 4980B of the Code and
Part 6 of Title I of ERISA ("COBRA Coverage"), if applicable, with respect to
any "qualified beneficiary" who is covered by a Seller Benefit Plan that is a
"group health plan" and who experiences a qualifying event prior to the Closing
Date. Buyers shall be solely responsible for offering and providing any COBRA
Coverage required with respect to any Transferred Employees (or other "qualified
beneficiaries") who become covered by a group health plan sponsored or
contributed to by Buyers and who experience a "qualifying event" after the
Closing Date. ("Qualified beneficiary," "group health plan" and "qualifying
event" are as defined in Section 4980B of the Code.)
(c) Sellers shall provide Buyers all information relating to
each Transferred Employee as Buyers may reasonably require in connection with
its employment of such persons, including, without limitation, initial
employment date, termination dates, reemployment dates, compensation and Tax
withholding history and such information shall be true and correct in all
material respects.
Section 7.5 SELLERS' EMPLOYEE BENEFIT PLANS.
(a) Sellers shall retain all obligations and liabilities under
the Seller Benefit Plans in respect of each employee or former employee
(including any beneficiary thereof) who is not a Transferred Employee,
including, without limitation, the St. Louis Employees. Seller or its designated
Affiliate shall retain all liabilities and obligations in respect of benefits
incurred as of the Closing Date by Transferred Employees under the Seller
Benefit Plans, and neither Buyer nor any of its Affiliates shall have any
liability with respect thereto. No assets of any Seller Benefit Plan shall be
transferred to any Buyer or any of its Affiliates or to any plan of any Buyer or
any of its Affiliates. Buyers shall be responsible for any multiemployer plan
withdrawal liability that may arise in connection with the transactions
contemplated by this Agreement in accordance with Title IV of ERISA with respect
to the multiemployer plans set forth on SCHEDULE 7.2(b). Sellers shall continue
to make the required contributions to such multiemployer plans through the
Closing Date.
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(b) Except for any liabilities and obligations arising under
any Assumed Collective Bargaining Agreement, with respect to the Transferred
Employees (including any beneficiary or dependent thereof), Sellers shall
retain, except to the extent reflected on the Closing Date Balance Sheets (i)
all liabilities and obligations arising under any group life, accident, medical,
dental or disability plan or similar arrangement (whether or not insured) to the
extent that such liability or obligation relates to contributions or premiums
accrued (whether or not payable), or to claims incurred (whether or not
reported), on or prior to the Closing Date, (ii) all liabilities and obligations
arising under any worker's compensation arrangement to the extent such liability
or obligation relates to the period prior to the Closing Date, including
liability for any retroactive worker's compensation premiums attributable to
such period and (iii) all other liabilities and obligations arising under the
Employee Plans and the Benefit Arrangements to the extent any such liability or
obligation relates to the period prior to the Closing Date, including
proportional accruals through the Closing Date and including, without
limitation, liabilities and obligations in respect of accruals through the
Closing Date under any bonus plan or arrangement, any vacation plans,
arrangements and policies.
(c) With respect to any Transferred Employee (including any
beneficiary or dependent thereof) who enters a hospital or is on short-term
disability or long-term disability under any Benefit Arrangement on or prior to
the Closing Date and continues in a hospital or on short-term disability or
long-term disability after the Closing Date, Sellers shall be responsible for
claims and expenses incurred both before and after the Closing Date in
connection with such Person, to the extent that such claims and expenses are
covered by a Benefit Arrangement, until such time, (if any) that, in the case of
a Transferred Employee, such Person resumes full-time employment with Buyers or
one of their Affiliates and, in the case of any beneficiary or dependent of a
Transferred Employee, such Person's hospitalization has terminated. With respect
to any Benefit Arrangements covering medical expenses and other costs relating
to pregnancies and maternity leave, Sellers shall be responsible for all claims
(whether or not reported) and expenses incurred during the period prior to and
ending on the Closing Date, and Buyers or one of their Affiliates shall be
responsible for such benefit arrangements covering such pregnancies and
maternity leave for the period subsequent to the Closing Date.
(d) Notwithstanding the foregoing, the provisions of Sections
7.5(a), (b) and (c) shall not apply to the Seller Benefit Plans of the Acquired
Subsidiaries. Buyers shall assume all liabilities, obligations and assets of the
Seller Benefit Plans of the Acquired Subsidiaries.
Section 7.6 BUYERS' BENEFIT PLANS. Buyers or one of their Affiliates
will recognize service of the Transferred Employees with Sellers or any of their
Affiliates for purposes of vesting and eligibility to participate in those
Employee Benefit Plans in which the Transferred Employees are enrolled by Buyers
or one of their Affiliates immediately after the Closing Date.
Section 7.7 WARN ACT. The parties agree to cooperate in good faith to
determine whether any notification may be required under the WARN Act as a
result of the transactions contemplated by this Agreement. Except as provided in
the following sentence, Buyers will be responsible for providing any
notification that may be required under the WARN Act with respect to any
Transferred Employees. Sellers will be responsible for providing any
notification that may be required under the WARN Act with respect to any St.
Louis Employees; provided that Buyers have given sufficient notice to enable
Sellers to provide such timely notification. If
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Buyers fail to provide sufficient notice, Buyers shall be liable for any
additional expenditure resulting from the failure to provide notification
required under the WARN Act with respect to any employees of the Business.
ARTICLE VIII.
TAXES
Section 8.1 REPRESENTATIONS AND WARRANTIES REGARDING TAXES. Each
Seller jointly and severally represents and warrants to Buyers as follows:
(a) Each Acquired Subsidiary has prepared and timely filed all
material Tax Returns with the appropriate Taxing authorities required to be
filed through the date of this Agreement by such Acquired Subsidiary (taking
into account any extension of time to file granted to or obtained on behalf of
such Acquired Subsidiary) and has timely paid all material Taxes shown thereon
(including those due with respect to any distribution or dividend to any of its
shareholders), and all interest and penalties due thereon and payable by it for
the Pre-Closing Tax Period which will have been required to be paid on or prior
to the Closing Date, the non-payment of which would result in a material Lien on
any of the Purchased Assets, would otherwise adversely affect the Business or
would result in any Buyer becoming liable or responsible therefor. SCHEDULE
8.1(a) identifies all closing agreements, Tax sharing agreements, open Tax
Return extensions, open extensions of statutes of limitations and rulings or
similar agreements with any Tax authority or other party involving Taxes due by
any of the Selling Parties.
(b) Each Seller Party has established, in accordance with GAAP
applied on a basis consistent with that of preceding periods, adequate reserves
for the payment of, and will timely pay all material Tax liabilities,
assessments, interest and penalties which arise from or with respect to the
Purchased Assets or which affect the Business and are incurred in or
attributable to the Pre-Closing Tax Period, the non-payment of which would
result in a material Lien on any of the Purchased Assets, would otherwise
adversely affect the Business or would result in any Buyer becoming liable
therefor.
(c) The unpaid Taxes of the Acquired Subsidiaries do not, as
of the Closing Date, exceed the reserve for Tax liability (other than any
reserve for deferred Taxes established to reflect timing differences between
book and Tax income) set forth on the face of the Closing Date Balance Sheets
and do not exceed that reserve as adjusted for the passage of time through the
Closing Date in accordance with the past custom and practice of the Acquired
Subsidiaries in filing their Tax Returns.
(d) To the Knowledge of the Seller Parties, there is no
pending or threatened commencement of any audit by the Mexican Ministry of
Finance and Public Credit (Secretaria de Hacienda y Credito Publico) concerning
any of the Tax Returns described in Section 8.1(a).
Section 8.2 TAX COOPERATION; ALLOCATION OF TAXES.
(a) The Parties agree to furnish or cause to be furnished to
each other, upon request, as promptly as practicable, such information and
assistance relating to the Business, the
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Purchased Assets and the Acquired Subsidiaries (including, without limitation,
access to books and records) as is reasonably necessary for the filing of all
Tax Returns, the making of any election relating to Taxes, the preparation for
any audit by any Taxing authority, and the prosecution or defense of any claim,
suit or proceeding relating to any Tax. Buyers and Sellers shall retain all
books and records with respect to Taxes pertaining to the Purchased Assets and
the Acquired Subsidiaries for a period of at least six years following the
Closing Date. Buyers and Sellers shall cooperate with each other in the conduct
of any audit or other proceeding relating to Taxes involving the Purchased
Assets, the Business and the Acquired Subsidiaries.
(b) All real property Taxes, personal property Taxes, similar
ad valorem obligations and all other Taxes levied with respect to the Purchased
Assets for a taxable period that includes (but does not end on) the Closing Date
shall be borne by Buyers.
(c) All excise, sales, use, value added, registration stamp,
recording, documentary, conveyancing, franchise, property, transfer, gains and
similar Taxes, levies, charges and fees (excluding any such Taxes, levies,
charges and fees based on the Seller Parties' net income under U.S. or Mexican
tax law) (collectively, "Transfer Taxes") incurred in connection with the
transactions contemplated by this Agreement shall be borne by Buyers. Buyers and
Sellers shall cooperate in providing each other with any appropriate resale
exemption certifications and other similar documentation. The Party that is
required by Applicable Law to make the filings, reports, or returns with respect
to any applicable Transfer Taxes shall do so, and the other Party shall
cooperate with respect thereto as necessary.
Section 8.3 ACQUIRED SUBSIDIARY TAX RETURNS. Wabtec shall prepare and
file on behalf of each Acquired Subsidiary, in a manner consistent with past
practices, all income, franchise, single business and other Tax Returns for any
Pre-Closing Tax Period, and shall pay all Taxes due with respect to such
periods, except for those set forth on the Closing Date Balance Sheets. Buyers
shall be responsible for filing all Tax Returns relating to each Acquired
Subsidiary, and the payment of all Taxes with respect thereto, for all periods
beginning on or after the Closing Date.
Section 8.4 CFC REPORTING REQUIREMENTS. At GETS' request, Wabtec shall
provide to GETS all of the information not otherwise available to any Buyer
required to satisfy the reporting requirements of Treasury Regulation Section
1.959-1(d) imposed upon any Buyer in respect of its ownership of the Acquired
Subsidiaries Shares, to the extent that such requirements relate to information
in the possession or control of any Seller Party.
ARTICLE IX.
CLOSING
Section 9.1 THE CLOSING. Except as provided in Section 3.2(a), the
consummation of the transactions contemplated by this Agreement (the "Closing")
shall take place at 10:00 a.m. on the fifth business day following the
satisfaction or waiver of the conditions set forth in Article X (the "Closing
Date"), at the offices of Xxxxx & Xxxxxxxxx LLP, 3200 National City Center, 0000
X. Xxxxx Xxxxxx, Xxxxxxxxx, Xxxx 00000, or at such other place or date as may be
agreed upon in writing by GETS and Wabtec.
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Section 9.2 DELIVERIES BY SELLER PARTIES. At or prior to the Closing,
the Seller Parties shall deliver to Buyers, duly and properly executed by each
applicable Seller Party, the following:
(a) One or more good and sufficient General Conveyance,
Assignment and Xxxx of Sale, each in a form reasonably acceptable to Wabtec and
GETS, conveying, selling, transferring and assigning to Buyers (or their
designees) title to all of the Seller Purchased Assets (other than the St. Louis
Assets) free and clear of all Liens;
(b) One or more Assignment and Assumption of the Assumed
Liabilities and the Contracts, each in a form reasonably acceptable to Wabtec
and GETS, which shall include, to the extent obtained, the written consents of
all parties necessary in order to duly transfer all of Seller's rights
thereunder to Buyers (or their designees) (the "Assignment and Assumption
Agreement");
(c) Certificates representing the Acquired Subsidiary Shares,
duly endorsed (or accompanied by duly executed stock powers) for transfer to
GETS or its nominee;
(d) An Assumption of the Retained Subsidiary Liabilities, in a
form reasonably acceptable to Wabtec and GETS;
(e) A Special Warranty Deed, in a form reasonably acceptable
to Wabtec and GETS, with respect to each parcel of Owned Real Property;
(f) A certificate of the officers of Wabtec delivered in
accordance with Section 10.2(e);
(g) One or more Assignments of Trademark and Servicemark, each
in a form reasonably acceptable to Wabtec and GETS;
(h) One or more Assignments of Patents, each in a form
reasonably acceptable to Wabtec and GETS;
(i) A receipt of Wabtec with respect to amounts paid to Wabtec
pursuant to Section 3.1(b) in a form and substance satisfactory to counsel to
Sellers and Buyers;
(j) A copy of the resolutions adopted by the board of
directors of each Seller Party authorizing the execution and delivery of this
Agreement and the consummation of the transactions contemplated hereby,
certified by the Secretary of such Seller Party;
(k) A certificate of the Secretary of State (or other
applicable Governmental Entity) of the jurisdiction in which each Seller Party
is formed or incorporated, dated as of a date no earlier than fourteen (14) days
prior to the Closing Date, as to the good standing of such Seller Party in such
jurisdiction;
(l) An opinion of Xxxx Xxxxx LLP, counsel for Sellers,
addressed to Buyers and dated the Closing Date, in a form reasonably acceptable
to Wabtec and GETS;
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(m) An Environmental Indemnity Agreement in the form attached
hereto as EXHIBIT 9.2(m), subject to Section 6.14(b) (the "Environmental
Indemnity Agreement") and, subject to Section 6.14(b), a certificate of
insurance with respect to the Environmental Insurance Policy issued by the
carrier thereof;
(n) Evidence reasonably satisfactory to GETS that all Liens
(other than Permitted Liens) affecting the Purchased Assets have been released;
(o) The IP Development and License Agreement;
(p) The Xxxxxxxx Lease;
(q) A letter of resignation, effective as of the Closing, from
each officer and director of each Acquired Subsidiary, other than those
designated by GETS prior to the Closing;
(r) A Supply and Marketing Agreement, in the form attached
hereto as EXHIBIT 9.2(q) (the "Supply and Marketing Agreement"); and
(s) Such other separate instruments of sale, assignment or
transfer that Buyers may reasonably deem necessary or appropriate in order to
perfect, confirm or evidence title to all or any part of the Purchased Assets.
Section 9.3 DELIVERIES BY BUYERS. At or prior to the Closing, GETS
shall deliver to or for the account of Wabtec the Closing Date Payment in
accordance with Section 3.1(b), and shall deliver to Sellers, all duly and
properly executed by each applicable Buyer (or Buyers' designees, as the case
may be), the following:
(a) The Assignment and Assumption Agreement(s);
(b) Subject to Section 6.14(b), the Environmental Indemnity
Agreement;
(c) A certificate of GETS in accordance with Section 10.3(c);
(d) A certificate of the Secretary or Assistant Secretary of
each Buyer certifying the due authorization of such Buyer to execute and deliver
this Agreement and consummate the transactions contemplated hereby;
(e) The IP Development and License Agreement;
(f) The Xxxxxxxx Lease;
(g) The Supply and Marketing Agreement; and
(h) A certificate of the Secretary of State (or other
applicable Governmental Entity) of the jurisdiction in which each Buyer Party is
formed or incorporated, dated as of a date no earlier than fourteen (14) days
prior to the Closing Date, as to the good standing of such Buyer Party in such
jurisdiction.
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ARTICLE X.
CONDITIONS PRECEDENT TO CLOSING OBLIGATIONS
Section 10.1 CONDITIONS TO EACH PARTY'S OBLIGATIONS. The respective
obligations of each Party to effect the transactions contemplated by this
Agreement will be subject to the fulfillment at or prior to the Closing of each
of the following conditions:
(a) LAWS, REGULATIONS AND INJUNCTION. No provision of any
Applicable Law shall restrain, prevent, materially delay or restructure the
transactions contemplated by this Agreement. There will be no effective
injunction, writ or preliminary restraining order or any order of any nature
issued by any Governmental Entity to the effect that the Acquisition may not be
consummated as provided in this Agreement, no proceeding or lawsuit will have
been commenced by any Governmental Entity for the purpose of obtaining any such
injunction, writ or preliminary restraining order and no written notice will
have been received from any Governmental Entity indicating an intent to
restrain, prevent, materially delay or restructure the transactions contemplated
by this Agreement.
(b) GOVERNMENTAL CONSENTS. All consents, approvals, orders or
authorizations of, or registrations, declarations or filings with, any
Governmental Entity required in connection with the execution, delivery or
performance of this Agreement will have been obtained or made, except where the
failure to have obtained or made any such consent, approval, order,
authorization, declaration or filing would not have a Material Adverse Effect on
the Business after the Closing.
(c) ANTITRUST APPROVALS. The waiting period applicable to the
consummation of the Acquisition under the Antitrust Acts shall have expired or
been terminated.
Section 10.2 CONDITIONS TO OBLIGATIONS OF BUYERS. The obligations of
Buyers to consummate the transactions contemplated by this Agreement will be
subject to the fulfillment at or prior to the Closing of each of the following
additional conditions:
(a) REPRESENTATIONS AND WARRANTIES. Except with respect to
breaches or inaccuracies that in the aggregate do not constitute a Material
Adverse Effect equal to or exceeding an amount equal to $25 million less the
difference, if any, of $110 million minus the Benchmark Net Worth (the
"Threshold Amount"), the representations and warranties of the Seller Parties in
this Agreement, considered collectively, and each of such representations and
warranties, considered individually, shall have been true and correct in all
respects as of the date hereof and shall be true and correct in all respects as
of the Closing Date as though made on and as of the Closing Date (other than
representations and warranties made as of a specified date, which shall be true
and correct in all respects only as of such date). For purposes of this Section
10.2(a) only: (i) the representations and warranties set forth in Section 4.2
shall be true and correct in all respects (other than de minimis items that
would not individually or in the aggregate adversely affect to any significant
extent Buyers' rights with respect to the ownership of the Acquired
Subsidiaries) regardless of whether a breach thereof or inaccuracy therein,
individually or in the aggregate, would constitute a Material Adverse Effect
equal to or exceeding the Threshold Amount, and (ii) all such representations
and warranties shall be
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construed without regard for materiality, Material Adverse Effect or similar
phrases contained within such representations and warranties.
(b) PERFORMANCE OF OBLIGATIONS OF THE SELLER PARTIES. The
Seller Parties shall have performed in all material respects all covenants and
agreements required to be performed by them under this Agreement on or prior to
the Closing Date.
(c) TAX SHARING AGREEMENTS. All Tax sharing agreements entered
into with respect to the Acquired Subsidiaries shall have been terminated.
(d) NO MATERIAL ADVERSE CHANGE. Between the date hereof and
the Closing Date, there shall not have occurred (nor shall any Buyer have become
aware of) any Material Adverse Effect on the Business.
(e) WABTEC CERTIFICATE. The Chief Financial Officer of Wabtec
shall have executed and delivered to Buyers a certificate as to compliance with
the conditions set forth in Sections 10.2(a), (b), (c) and (d).
(f) CLOSING DELIVERIES. The Seller Parties shall have made all
other deliveries required by Section 9.2.
(g) CONSENTS. Sellers shall have obtained and delivered to
GETS the written consents (or waivers with respect to thereto) indicated on
SCHEDULE 2.1(h), and all such consents and waivers shall be in full force and
effect.
(h) ENVIRONMENTAL REVIEWS. The Environmental Consultant shall
have delivered to GETS a copy of the Environmental Report which complies in all
material respects with Section 6.14.
(i) ENVIRONMENTAL INSURANCE. Wabtec shall have delivered to
Buyers a certificate of insurance with respect to the Environmental Insurance
Policy issued by the carrier thereof as provided in Section 6.14(b).
Section 10.3 CONDITIONS TO OBLIGATIONS OF THE SELLER PARTIES. The
obligations of the Seller Parties to consummate the transactions contemplated by
this Agreement will be subject to the fulfillment at or prior to the Closing of
each of the following additional conditions:
(a) REPRESENTATIONS AND WARRANTIES. All of the representations
and warranties of Buyers in this Agreement (considered collectively), and each
of such representations and warranties (considered individually), shall have
been true and correct in all material respects as of the date hereof and shall
be true and correct in all material respects as of the Closing Date as though
made on and as of the Closing Date.
(b) PERFORMANCE OF OBLIGATIONS BY BUYERS. Buyers shall have
performed in all material respects all covenants and agreements required to be
performed by them under this Agreement on or prior to the Closing Date.
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(c) CERTIFICATES. GETS shall have delivered to Wabtec a
certificate of an authorized officer as to compliance with the conditions set
forth in Sections 10.3(a) and (b).
(d) CLOSING DELIVERIES. Buyers shall have made all other
deliveries required by Section 9.3.
ARTICLE XI.
TERMINATION
Section 11.1 TERMINATION. This Agreement may be terminated at any time
at or prior to the Closing (the "Termination Date"):
(a) in writing by mutual consent of GETS and Wabtec;
(b) by written notice from Wabtec to GETS, if any Buyer (i)
fails to perform in any material respect any of its agreements contained in this
Agreement required to be performed by it on or prior to the Closing Date or (ii)
materially breaches any of its representations and warranties contained in this
Agreement, which failure or breach is not cured within ten (10) days after
Wabtec has notified GETS of its intent to terminate this Agreement pursuant to
this subparagraph (b);
(c) by written notice from GETS to Wabtec, if any Seller Party
(i) fails to perform in any material respect any of its agreements contained in
this Agreement required to be performed by it on or prior to the Closing Date or
(ii) breaches any of the representations and warranties of the Seller Parties in
this Agreement, except for breaches that in the aggregate do not constitute a
Material Adverse Effect equal to or exceeding the Threshold Amount (provided
that, for purposes of this Section 11.1(c) only, (A) a breach of the
representations and warranties set forth in Section 4.2 (other than de minimis
items that would not individually or in the aggregate adversely affect to any
significant extent Buyers' rights with respect to the ownership of the Acquired
Subsidiaries) shall entitle GETS to terminate this Agreement pursuant to this
Section 11.1(c) regardless of whether such breach, individually or in the
aggregate, would constitute a Material Adverse Effect equal to or exceeding the
Threshold Amount, and (B) all such representations and warranties shall be
construed without regard for materiality, Material Adverse Effect or similar
phrases contained within such representations and warranties), which failure or
breach is not cured within ten (10) days after GETS has notified Wabtec of its
intent to terminate this Agreement pursuant to this subparagraph (c);
(d) by written notice from GETS to Wabtec under the
circumstances described in Section 6.11(a), Section 6.14(a), or if GETS
determines, in its good faith reasonable determination pursuant to its due
diligence review, that a Material Adverse Effect on the Business exists.
(e) by written notice by Wabtec to GETS or GETS to Wabtec, as
the case may be, if the Closing does not occur by November 30, 2001; provided,
however, that Wabtec and GETS, as the case may be, shall only have the right to
terminate this Agreement pursuant to this Section 11.1(e) if the reason for the
Closing not to have occurred by November 30, 2001 is
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due to a reason other than non-performance of any Buyer (if GETS is seeking such
termination) or any Seller Party (if Wabtec is seeking such termination); or
(f) by either GETS or Wabtec if there shall be any Applicable
Law that makes the consummation of the transactions contemplated hereby illegal
or otherwise prohibited or if consummation of the transactions contemplated
hereby would violate any nonappealable final order, decree or judgment of any
court or governmental body having competent jurisdiction.
Section 11.2 SPECIFIC PERFORMANCE AND OTHER REMEDIES. The Parties each
acknowledge that the rights of each Party to consummate the transactions
contemplated by this Agreement are special, unique and of extraordinary
character and that, in the event that any Party violates or fails or refuses to
perform any covenant or agreement made by it in this Agreement, the
non-breaching Party may be without an adequate remedy at law. The Parties agree,
therefore, that in the event that any Party violates or fails or refuses to
perform any covenant or agreement made by such Party in this Agreement, the
non-breaching Party or Parties may, subject to the terms of this Agreement and
in addition to any remedies at law for damages or other relief, institute and
prosecute an action in any court of competent jurisdiction to enforce specific
performance of such covenant or agreement or seek any other equitable relief.
Section 11.3 EFFECT OF TERMINATION. If this Agreement is terminated as
permitted by Section 11.1, such termination shall be without liability of either
Party (or any stockholder, director, officer, employee, agent, consultant or
representative of such Party) to the other Party to this Agreement; provided
that if such termination shall result from the (i) willful failure of any Party
to fulfill a condition to the performance of the obligations of the other Party,
(ii) failure to perform a covenant of this Agreement or (iii) breach, in any
material respect, by any Party hereto of any representation or warranty or
agreement contained herein, such Party shall be fully liable for any and all
damages incurred or suffered by the other Party as a result of such failure or
breach. The provisions of Section 6.7 (Public Announcements), Section 13.1
(Notices), Section 13.6 (Choice of Law; Venue), and Section 13.14 (Transaction
Costs) shall survive any termination hereof pursuant to Section 11.1.
ARTICLE XII.
INDEMNIFICATION
Section 12.1 TERMINATION OF CERTAIN REPRESENTATIONS AND WARRANTIES.
None of the representations and warranties of the Seller Parties in this
Agreement shall survive the Closing except for those in the following Sections,
Subsections, or portions thereof, as the case may be (collectively, the
"Surviving Representations"): Section 4.1 (Organization); Section 4.2
(Capitalization of Acquired Subsidiaries); Section 4.3 (Authorization); Section
4.4 (Absence of Restrictions and Conflicts); Section 4.6(a) (Title to Assets);
Section 4.7(c) and (d) (Income Statements); Section 4.8 (Absence of Certain
Changes), but only with respect to events or occurrences resulting from the acts
or omissions of any Wabtec Group Member; Section 4.10 (Compliance with Law);
Section 4.14(b)(i), (iii), (viii) and (ix) (Intellectual Property; Software);
Section 4.18 (Ethical Practices); and Article VIII (Taxes). The Parties
acknowledge and agree that Buyers shall have no remedy after the Closing
pursuant to this Agreement for any breach of
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the representations and warranties of the Seller Parties set forth in Section
4.13 (Environmental, Health and Safety Matters), and that any post-Closing
remedy of Buyers for any such breach shall be pursuant to the terms and
conditions of the Environmental Indemnity Agreement.
Section 12.2 INDEMNIFICATION OBLIGATIONS OF SELLERS. Each Seller will
jointly and severally indemnify, defend and hold harmless each Buyer and its
Affiliates, each of their respective officers, directors, employees, agents and
representatives and each of the heirs, executors, successors and assigns of any
of the foregoing (collectively, the "Buyer Indemnified Parties") from, against
and in respect of any and all claims, liabilities, obligations, losses, costs,
expenses, penalties, fines and judgments (at equity or at law) and actual
damages whenever arising or incurred (including, without limitation, amounts
paid in settlement, costs of investigation and reasonable attorneys' fees and
expenses) arising out of or relating to:
(a) any Excluded Liabilities or any Retained Subsidiary
Liabilities;
(b) any breach or inaccuracy of any Surviving Representation
(for purposes of this Article XII, such representations and warranties shall be
read without reference to materiality, Material Adverse Effect or similar
phrases);
(c) the assertion of any third-party Action that is not the
subject of any other representation or warranty herein, after the Closing,
relating to any state of facts, change, event, effect or occurrence that existed
at or prior to the Closing;
(d) any breach or non-performance of any covenant, agreement
or undertaking made by any Seller Party in this Agreement or in the Seller
Ancillary Documents;
(e) any fraud, willful misconduct or bad faith of any Seller
Party in connection with this Agreement or the Seller Ancillary Documents; or
(f) non-compliance by the Parties with any applicable bulk
sales legislation.
(The claims, liabilities, obligations, losses, costs, expenses, penalties, fines
and damages of the Buyer Indemnified Parties described in this Section 12.2 as
to which the Buyer Indemnified Parties are entitled to indemnification are
collectively referred to herein as the "Buyer Losses.") The rights to
indemnification pursuant to this Section 12.2 are in addition to those available
to the Buyer Indemnified Parties pursuant to the Environmental Indemnity
Agreement.
Section 12.3 INDEMNIFICATION OBLIGATIONS OF BUYERS. Buyers will
jointly and severally indemnify and hold harmless each Seller Party and each of
its officers, directors, employees, agents and representatives and each of the
heirs, executors, successors and assigns of any of the foregoing (collectively,
the "Seller Indemnified Parties") from, against and in respect of any and all
claims, liabilities, obligations, losses, costs, expenses, penalties, fines and
judgments (at equity or at law, including statutory and common) and actual
damages whenever arising or incurred (including, without limitation, amounts
paid in settlement, costs of investigation and reasonable attorneys' fees and
expenses) arising out of or relating to:
(a) the failure of either Buyer to perform, discharge or
satisfy the Assumed Liabilities;
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(b) any breach or inaccuracy of any representation or warranty
made by Buyers in this Agreement or in any of the Buyer Ancillary Documents (for
purposes of this Article XII, such representations and warranties shall be read
without reference to materiality, Material Adverse Effect or similar phrases);
(c) any breach or non-performance of any covenant, agreement
or undertaking made by either Buyer in this Agreement or in any of the Buyer
Ancillary Documents; or
(d) any fraud, willful misconduct or bad faith of either Buyer
in connection with this Agreement or the Buyer Ancillary Documents.
(The claims, liabilities, obligations, losses, costs, expenses, penalties, fines
and damages of the Seller Indemnified Parties described in this Section 12.3 as
to which the Seller Indemnified Parties are entitled to indemnification are
hereinafter collectively referred to as "Seller Losses.")
Section 12.4 INDEMNIFICATION PROCEDURE.
(a) Promptly after receipt by a Buyer Indemnified Party or a
Seller Indemnified Party (hereinafter collectively referred to as an
"Indemnified Party") of notice by a third party (including any Governmental
Entity) of any complaint or the commencement of any audit, investigation, action
or proceeding with respect to which such Indemnified Party may be entitled to
receive payment from the other Party for any Buyer Losses or Seller Losses (as
the case may be), such Indemnified Party will notify GETS or Wabtec, as the case
may be (the "Indemnifying Party"), promptly following the Indemnified Party's
receipt of such complaint or of notice of the commencement of such audit,
investigation, action or proceeding; provided, however, that the failure to so
notify the Indemnifying Party will relieve the Indemnifying Party from liability
under this Agreement with respect to such claim only if, and only to the extent
that, the Indemnifying Party is prejudiced thereby. The Indemnifying Party will
have the right, upon written notice delivered to the Indemnified Party within
ten (10) days to assume the defense of such audit, investigation, action or
proceeding, including the employment of counsel reasonably satisfactory to the
Indemnified Party and the payment of the fees and disbursements of such counsel.
If, however, the Indemnifying Party declines or fails to assume the defense of
the audit, investigation, action or proceeding on the terms provided above or to
employ counsel reasonably satisfactory to the Indemnified Party, in either case
within such ten (10)-day period, then such Indemnified Party may employ counsel
to represent or defend it in any such audit, investigation, action or proceeding
and the Indemnifying Party will pay the reasonable fees and disbursements of
such counsel as incurred; provided, however, that the Indemnifying Party will
not be required to pay the fees and disbursements of more than one (1) counsel
for all Indemnified Parties in any jurisdiction in any single audit,
investigation, action or proceeding. In any audit, investigation, action or
proceeding with respect to which indemnification is being sought hereunder, the
Indemnified Party or the Indemnifying Party, whichever is not assuming the
defense of such action, will have the right to participate in such matter and to
retain its own counsel at such Party's own expense. The Indemnifying Party or
the Indemnified Party, as the case may be, will at all times use reasonable
efforts to keep the Indemnifying Party or the Indemnified Party, as the case may
be, reasonably apprised of the status of the defense of any matter the defense
of which they are maintaining and to cooperate in good faith with each other
with respect to the defense of any such matter.
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(b) No Indemnified Party may settle or compromise any claim or
consent to the entry of any judgment with respect to which indemnification is
being sought hereunder without the prior written consent of the Indemnifying
Party, unless (i) the Indemnifying Party fails to assume and maintain the
defense of such claim pursuant to Section 12.4(a) or (ii) such settlement,
compromise or consent includes an unconditional release of the Indemnifying
Party from all liability arising out of such claim. An Indemnifying Party may
not, without the prior written consent of the Indemnified Party, settle or
compromise any claim or consent to the entry of any judgment with respect to
which indemnification is being sought hereunder unless (i) such settlement,
compromise or consent includes an unconditional release of the Indemnified Party
from all liability arising out of such claim, (ii) does not contain any
admission or statement suggesting any wrongdoing or liability on behalf of the
Indemnified Party and (iii) does not contain any equitable order, judgment or
term which in any manner affects, restrains or interferes with the business of
the Indemnified Party or any of the Indemnified Party's Affiliates.
(c) In the event any Indemnified Party should have a claim for
indemnity against any Indemnifying Party that does not involve a third party
claim, the Indemnified Party shall deliver notice of such claim with reasonable
promptness to the Indemnifying Party. Such notice shall specify the basis for
such claim. The failure by any Indemnified Party so to notify the Indemnifying
Party shall not relieve the Indemnifying Party from any liability that it may
have to such Indemnified Party with respect to any claim made pursuant to this
Section 12.4(c), it being understood that notices for claims in respect of a
breach of a representation or warranty must be delivered prior to the expiration
of the applicable Claims Period for such representation or warranty under
Section 12.5. If the Indemnifying Party disputes its liability with respect to
such claim, such Indemnifying Party and the Indemnified Party will establish the
merits and amount of such claim (by mutual agreement, litigation or otherwise)
and, within five (5) business days of the final determination of the merits and
amount of such claim, the Indemnifying Party will pay to the Indemnified Party
immediately available funds in an amount equal to such claim as determined
hereunder.
Section 12.5 CLAIMS PERIOD. For purposes of this Agreement, a "Claims
Period" shall be the period during which a claim for indemnification may be
asserted under this Agreement by an Indemnified Party. The Claims Periods under
this Agreement shall begin on the date hereof and terminate as follows:
(a) The Claims Period shall continue indefinitely, except as
limited by law (including by applicable statutes of limitation), with respect to
any indemnification claim of any Buyer Indemnified Party arising under:
(i) Section 12.2(b) with respect to any breach or
inaccuracy of any Surviving Representation in:
(A) Section 4.1 (Organization); Section 4.2
(Capitalization of the Acquired Subsidiaries), Section 4.3
(Authorization), Section 4.6(a) (Title to Assets) and Article
VIII (Taxes); or
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(B) Section 4.14 (Intellectual Property), but only
with respect to those representations and warranties that
relate to title;
(ii) Section 12.2(c), but only with respect to Actions
relating to asbestos-containing gaskets allegedly manufactured or
distributed by any Wabtec Group Member; or
(iii) Section 12.2(a) or Section 12.2(e).
(b) The Claims Period shall continue indefinitely, except as
limited by law (including any applicable statutes of limitation), with respect
to any indemnification claim of any Seller Indemnified Party arising under (i)
Section 12.3(b) with respect to any breach or inaccuracy of any representation
or warranty in Section 5.2, or (ii) Section 12.3(a) or Section 12.3(d).
(c) The Claims Period shall terminate on February 28, 2002
with respect to any indemnification claim of any Buyer Indemnified Party arising
under Section 12.2(b) with respect to any breach or inaccuracy of any Surviving
Representation in Section 4.7(c) or Section 4.7(d) (Financial Statements).
(d) The Claims Period shall continue indefinitely, except as
limited by law (including by applicable statutes of limitations) and except as
specifically limited by the provisions of the applicable covenant, agreement or
undertaking, with respect to all indemnification claims of any Indemnified Party
arising under Section 12.2(d) or Section 12.3(c).
(e) The Claims Period shall terminate on the date that is
eighteen (18) months after the Closing Date with respect to all other
indemnification claims of any Indemnified Party arising under this Agreement.
Notwithstanding the foregoing, if, prior to the close of business on the last
day of the applicable Claims Period, an Indemnifying Party shall have been
properly notified of a claim for indemnity hereunder and such claim shall not
have been finally resolved or disposed of at such date, such claim shall
continue to survive and shall remain a basis for indemnity hereunder until such
claim is finally resolved or disposed of in accordance with the terms hereof.
Section 12.6 LIABILITY LIMITS. Notwithstanding anything to the
contrary set forth herein:
(a) The Buyer Indemnified Parties shall not make a claim
against any Seller for indemnification for Buyer Losses pursuant to any
subparagraph of Section 12.2 (i) other than Section 12.2(a) and Section 12.2(e)
and (ii) other than Section 12.2(d), except for claims of breach or
non-performance of the covenants contained in Sections 2.3(a), 6.1(a), 6.1(e),
6.1(o), 6.1(r), 6.1(s), 6.4, 6.8, 6.17 and 6.18 unless and until the aggregate
amount of such Buyer Losses exceeds $3,000,000, in which event the Buyer
Indemnified Parties may claim indemnification for all such Buyer Losses in
excess of $3,000,000; and
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(b) the maximum aggregate liability of Sellers for Buyer Losses with respect to
claims for indemnification pursuant to Section 12.2 (i) excluding Section
12.2(a) and Section 12.2(e) and (ii) excluding Section 12.2(d), except for
claims of breach or non-performance of the covenants contained in Sections
2.3(a), 6.1(a), 6.1(e), 6.1(o), 6.1(r), 6.1(s), 6.4, 6.8, 6.17 and 6.18 shall be
$13,000,000; and
(c) if any Buyer Indemnified Party recovers from Sellers pursuant to this
Article XII and has an insurance claim against an insurance company that is not
an Affiliate of Buyers for the Buyer Losses that were recovered from Sellers,
GETS shall use good faith efforts to pursue such claim and pay to Sellers any
proceeds from such claim (net of any deductibles) up to the amount actually
recovered from Sellers.
Section 12.7 INVESTIGATIONS. Notwithstanding anything to the contrary
contained herein:
(a) Buyers hereby waive any right they may have to file a
claim for reimbursement or indemnity against Sellers under the terms of this
Agreement concerning any matter in respect of which it is determined that
Buyers, on or prior to the date hereof (i) had Knowledge of facts that
constitute a breach by Sellers of any representation or warranty made under this
Agreement and (ii) failed to disclose such Knowledge to Sellers prior to the
date hereof; and
(b) Buyers hereby waive any right they may have to file a
claim for reimbursement or indemnity against Sellers under the terms of this
Agreement concerning any matter in respect of which it is determined that Buyers
between the date hereof and the Closing Date (i) had Knowledge of facts that
constitute a breach by Sellers of any representation or warranty made under this
Agreement and (ii) failed to disclose such Knowledge to Sellers between the date
hereof and the Closing Date, provided, however, that such waiver has no effect
unless such breach of representation or warranty gives rise to a right of Buyers
in their reasonable judgment to terminate this Agreement pursuant to Section
11.1(c) because the condition in Section 10.2(a) is not satisfied.
Section 12.8 EXCLUSIVE REMEDY. Except for any remedies available under
the Environmental Indemnity Agreement, the Parties agree that the provisions of
this Article XII constitute the sole and exclusive remedy of the Parties with
respect to any Action of any nature whatsoever arising from this Agreement or
the transactions contemplated hereby.
ARTICLE XIII.
MISCELLANEOUS PROVISIONS
Section 13.1 NOTICES. All notices, communications and deliveries under
this Agreement will be made in writing signed by or on behalf of the Party
making the same, will specify the Section under this Agreement pursuant to which
it is given or being made, and will be delivered personally or by telecopy
transmission or sent by registered or certified mail (return receipt requested)
or by next day courier (with evidence of delivery and postage and other fees
prepaid) as follows:
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To either Buyer: GE Transportation Systems
0000 Xxxx Xxxx Xxxx
Xxxx. 00-000
Xxxx, XX 00000
Attn: Xxxx Xxxxxxxx, Jr., President
and Chief Executive Officer
Telecopy No.: (000) 000-0000
with a copy to: GE Transportation Systems
0000 Xxxx Xxxx Xxxx
Xxxx. 00-000
Xxxx, XX 00000
Attn: W. Xxxxx Xxxxxx, General Counsel
Telecopy No.: (000) 000-0000
and to: Xxxxx & Xxxxxxxxx LLP
3200 National City Center
0000 Xxxx 0xx Xxxxxx
Xxxxxxxxx, XX 00000
Attn: Xxxxxx X. Xxxx
Telecopy: (000) 000-0000
To any Seller Party: Westinghouse Air Brake
Technologies Corporation
0000 Xxx Xxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
Attn: Xxxx Xxxxxx, President
and Chief Executive Officer
Telecopy No.: (000) 000-0000
with a copy to: Westinghouse Air Brake
Technologies Corporation
0000 Xxx Xxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
Attn: Xxxxxx Xxxxxx-Xxxxx,
Senior Vice President-Finance
Telecopy No.: (000) 000-0000
and to: Xxxx Xxxxx LLP
000 0xx Xxxxxx
Xxxxxxxxxx, XX 00000
Attn: Xxxxx X. XxXxxxx, Esq.
Telecopy No.: (000) 000-0000
or to such other representative or at such other address of a Party as such
Party may furnish to the other Parties in writing. Any notice which is delivered
personally or by telecopy transmission in the manner provided herein shall be
deemed to have been duly given to the Party to whom it is directed upon actual
receipt by such Party or its agent. Any notice which is addressed and mailed in
the manner herein provided shall be conclusively presumed to have been
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duly given to the Party to which it is addressed at the close of business, local
time of the recipient, on the fourth business day after the day it is so placed
in the mail (or on the first business day after placed in the mail if sent by
overnight courier)or, if earlier, the time of actual receipt.
Section 13.2 SCHEDULES AND EXHIBITS. The Schedules and Exhibits to
this Agreement are hereby incorporated into this Agreement and are hereby made a
part of this Agreement as if set out in full in this Agreement.
Section 13.3 ASSIGNMENT; SUCCESSORS IN INTEREST; AMENDMENT. No
assignment or transfer by any Party of such Party's rights and obligations under
this Agreement will be made except with the prior written consent of the other
Parties to this Agreement; provided, however, that Buyers shall, without the
obligation to obtain the prior written consent of any other Party to this
Agreement, be entitled to assign this Agreement or all or any part of its rights
or obligations hereunder to any one or more of their Affiliates provided that
Buyers remain liable for any obligations under this Agreement. This Agreement
will be binding upon and will inure to the benefit of the Parties and their
successors and permitted assigns, and any reference to a Party will also be a
reference to a successor or permitted assign. This Agreement may not be amended,
modified or supplemented except by written agreement of the Parties.
Section 13.4 NUMBER; GENDER. Whenever the context so requires, the
singular number will include the plural and the plural will include the
singular, and the gender of any pronoun will include the other genders.
Section 13.5 CAPTIONS. The titles, captions and table of contents
contained in this Agreement are inserted in this Agreement only as a matter of
convenience and for reference and in no way define, limit, extend or describe
the scope of this Agreement or the intent of any provision of this Agreement.
Unless otherwise specified to the contrary, all references to Articles and
Sections are references to Articles and Sections of this Agreement and all
references to Schedules or Exhibits are references to Schedules and Exhibits,
respectively, to this Agreement.
Section 13.6 JURISDICTION, VENUE AND APPLICABLE LAW(a) . The Parties
agree that any suit, action, dispute or proceeding related to this Agreement or
the transactions related hereto shall be brought in the federal courts located
in Allegheny County in the Commonwealth of Pennsylvania. By execution hereof,
each Party irrevocably waives any objection to, and any right of immunity on the
grounds of, improper venue, the convenience of the forum, the personal
jurisdiction of such court or the execution of any judgment resulting therefrom.
This Agreement and the transactions related hereto shall be governed by the laws
of the State of New York, without regard for conflicts of laws principles
thereof. EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT
TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATED TO THIS
AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.
Section 13.7 SEVERABILITY. Any provision of this Agreement which is
prohibited or unenforceable in any jurisdiction will, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions of this Agreement,
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and any such prohibition or unenforceability in any jurisdiction will not
invalidate or render unenforceable such provision in any other jurisdiction. To
the extent permitted by law, the Parties waive any provision of law which
renders any such provision prohibited or unenforceable in any respect.
Section 13.8 COUNTERPARTS. This Agreement may be executed in two (2)
or more counterparts, each of which will be deemed an original, and it will not
be necessary in making proof of this Agreement or the terms of this Agreement to
produce or account for more than one (1) of such counterparts.
Section 13.9 NO THIRD PARTY BENEFICIARIES. Nothing expressed or
implied in this Agreement is intended, or will be construed, to confer upon or
give any Person other than the Parties, and their successors or permitted
assigns, any rights, remedies, obligations or liabilities under or by reason of
this Agreement, or result in such Person being deemed a third party beneficiary
of this Agreement. Without limiting the foregoing, no provision of Article VII
shall create any third party beneficiary or other rights in any employee or
former employee (including any beneficiary or dependent thereof) of any Seller
Party or of its Affiliates in respect of continued employment (or resumed
employment) with Buyers or any of their Affiliates and no provision of Article
VII shall create any such rights in any such Persons in respect of any benefits
that may be provided, directly or indirectly, under any Employee Plan or Benefit
Arrangement or any plan or arrangement which may be established by Buyers or any
of their Affiliates. No provision of this Agreement shall constitute a
limitation on rights to amend, modify or terminate after the Closing Date any
such plans or arrangements of Buyers or any of their Affiliates.
Section 13.10 WAIVER. Any agreement on the part of a Party to any
extension or waiver of any provision of this Agreement will be valid only if set
forth in an instrument in writing signed on behalf of such Party. A waiver by a
Party of the performance of any covenant, agreement, obligation, condition,
representation or warranty will not be construed as a waiver of any other
covenant, agreement, obligation, condition, representation or warranty. A waiver
by a Party of a condition to Closing will not be considered a waiver of any
rights to indemnification that may be claimed by such Party with respect to the
matters relating to such waived condition. A waiver by any Party of the
performance of any act will not constitute a waiver of the performance of any
other act or an identical act required to be performed at a later time.
Section 13.11 INTEGRATION. This Agreement and the documents executed
pursuant to this Agreement supersede all negotiations, agreements and
understandings (both written and oral) among the Parties with respect to the
subject matter of this Agreement, except for that certain Confidentiality
Agreement, dated November 8, 2000, between GETS and Wabtec, and constitutes the
entire agreement between the Parties. The Parties hereby agree that for purposes
of this Agreement (including, but not limited to conditions to Closing and
indemnification obligations) neither Party has made to the other any
representations, warranties or covenants or other disclosures other than those
contained in this Agreement.
Section 13.12 COMPLIANCE WITH BULK SALES LAWS. The Parties hereby
waive compliance by the Parties with the bulk sales laws and any other similar
laws in any applicable jurisdiction in respect of the transactions contemplated
by this Agreement.
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Section 13.13 COOPERATION FOLLOWING THE CLOSING. Following the
Closing, each of the Parties shall deliver to the others such further
information and documents and shall execute and deliver to the others such
further instruments and agreements as the other Party shall reasonably request
to consummate or confirm the transactions provided for in this Agreement, to
accomplish the purpose of this Agreement or to assure to the other Party the
benefits of this Agreement.
Section 13.14 TRANSACTION COSTS. Except as provided above or as
otherwise expressly provided herein, (a) Buyers will pay their own fees, costs
and expenses incurred in connection with this Agreement and the transactions
contemplated by this Agreement, including the fees, costs and expenses of their
financial advisors, accountants and counsel, and (b) Sellers will pay the fees,
costs and expenses of the Seller Parties incurred in connection with this
Agreement and the transactions contemplated by this Agreement, including the
fees, costs and expenses of their financial advisors, accountants and counsel.
All filing fees associated with any filings required under the Antitrust Acts
shall be borne by GETS.
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[Signature page to Purchase Agreement.]
IN WITNESS WHEREOF, the Parties have caused this Agreement to be duly
executed, as of the date first above written.
BUYERS:
GENERAL ELECTRIC COMPANY, through its GE
TRANSPORTATION SYSTEMS business
By:
----------------------------------
Name: Xxxx Xxxxxxxx
Title: President and Chief Executive Officer, GE
Transportation Systems
GE MEXICO S.A. DE C.V.
By:
----------------------------------
Name: Xxxxx X. Xxxxxxxx
Title: General Counsel, GE Mexico
SELLER PARTIES:
WESTINGHOUSE AIR BRAKE TECHNOLOGIES CORPORATION
By:
----------------------------------
Name:
-------------------------------
Title:
------------------------------
WABTEC DISTRIBUTION COMPANY
By:
----------------------------------
Name:
-------------------------------
Title:
------------------------------
WABTEC ENGINE SYSTEMS COMPANY
By:
----------------------------------
Name:
-------------------------------
Title:
------------------------------
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[Signature page to Purchase Agreement.]
WABTEC HOLDING CORP.
By:
----------------------------------
Name:
-------------------------------
Title:
------------------------------
MOTIVEPOWER, INC.
By:
----------------------------------
Name:
-------------------------------
Title:
------------------------------
YOUNG TOUCHSTONE COMPANY
By:
----------------------------------
Name:
-------------------------------
Title:
------------------------------
WABTEC AUSTRALIA PTY. LTD.
By:
----------------------------------
Name:
-------------------------------
Title:
------------------------------
MPI DE MEXICO, S.A. DE C.V.
By:
----------------------------------
Name:
-------------------------------
Title:
------------------------------
MPI NORESTE, S.A. DE C.V.
By:
----------------------------------
Name:
-------------------------------
Title:
------------------------------
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[Signature page to Purchase Agreement.]
MOTOR COILS DE MEXICO, S.A. DE C.V.
By:
----------------------------------
Name:
-------------------------------
Title:
------------------------------