SHARE PURCHASE AGREEMENT DATED AS OF SEPTEMBER 30, 2009 BY AND AMONG MICHAEL BAKER CORPORATION, BAKER HOLDING CORPORATION, BAKER OTS, INC., MICHAEL BAKER INTERNATIONAL, INC., WOOD GROUP E.&P.F. HOLDINGS, INC., WOOD GROUP HOLDINGS (INTERNATIONAL)...
Exhibit 10.1
DATED AS OF SEPTEMBER 30, 2009
BY AND AMONG
XXXXXXX XXXXX CORPORATION,
XXXXX HOLDING CORPORATION,
XXXXX OTS, INC.,
XXXXXXX XXXXX INTERNATIONAL, INC.,
WOOD GROUP E.&P.F. HOLDINGS, INC.,
WOOD GROUP HOLDINGS (INTERNATIONAL) LIMITED,
AND
WOOD GROUP ENGINEERING AND OPERATIONS SUPPORT LIMITED
TABLE OF CONTENTS
ARTICLE I DEFINITIONS |
1 | |||
1.1 Definitions |
1 | |||
1.2 Accounting Terms and Determinations Usage |
11 | |||
ARTICLE II PURCHASE AND SALE OF THE SHARES |
11 | |||
2.1 Purchase and Sale of the Shares |
11 | |||
2.2 Closing |
11 | |||
2.3 Purchase Price |
11 | |||
2.4 Purchase Price Adjustment |
13 | |||
ARTICLE III CONDITIONS OF CLOSING |
17 | |||
3.1 Conditions to Obligations of Buyers |
17 | |||
3.2 Conditions to Obligations of the Sellers |
21 | |||
ARTICLE IV REPRESENTATIONS AND WARRANTIES CONCERNING ACQUIRED SUBSIDIARIES |
22 | |||
4.1 Organization, Good Standing, Qualification and Power; Equity Interests, Etc. |
22 | |||
4.2 Accounting; Financial and Business Matters |
24 | |||
4.3 Material Contracts |
28 | |||
4.4 Litigation |
30 | |||
4.5 Real Property |
31 | |||
4.6 Title and Condition and Sufficiency of Assets |
31 | |||
4.7 Intellectual Property |
32 | |||
4.8 Benefit Plans |
33 | |||
4.9 Related Party Transactions |
35 | |||
4.10 Non-contravention; Consents |
35 | |||
4.13 Legal Compliance |
41 | |||
4.14 Environmental, Health, and Safety |
43 | |||
4.16 Banking Relationships |
47 | |||
4.17 Vessels |
48 | |||
4.18 Customers and Suppliers |
49 | |||
4.19 Disclosure |
50 | |||
4.20 Brokers |
50 | |||
4.21 Sole Representations and Warranties |
50 | |||
ARTICLE V REPRESENTATIONS AND WARRANTIES OF THE SELLERS |
50 | |||
5.1 Organization, Authority and Enforceability, No Violations, Etc. |
50 | |||
5.2 Ownership |
51 | |||
5.3 Brokers |
51 | |||
5.4 Legal Action |
52 | |||
5.5 Sole Representations and Warranties |
52 | |||
ARTICLE VI REPRESENTATIONS AND WARRANTIES OF BUYERS |
52 | |||
6.1 Organization, Authority and Enforceability, No Violations, Etc. |
52 |
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6.2 Legal Action |
53 | |||
6.3 Brokers |
53 | |||
6.4 No Distribution, Investment Intent |
53 | |||
6.5 Resale Restrictions |
53 | |||
6.6 Capitalization |
53 | |||
6.7 Sole Representations and Warranties |
53 | |||
ARTICLE VII PRE-CLOSING AND POST-CLOSING COVENANTS |
54 | |||
7.1 Pre-Closing Covenants |
54 | |||
7.2 Post-Closing Covenants |
57 | |||
ARTICLE VIII TAX MATTERS |
63 | |||
8.1 Tax Indemnification |
63 | |||
8.2 Straddle Period |
63 | |||
8.3 Responsibility for Filing Tax Returns |
64 | |||
8.4 Cooperation on Tax Matters |
65 | |||
8.5 Tax-Sharing Agreements |
65 | |||
8.6 Certain Taxes and Fees |
65 | |||
8.7 Audits |
66 | |||
8.8 Carrybacks |
66 | |||
8.9 Retention of Carryovers |
66 | |||
8.9 Section 338(g) Election |
66 | |||
ARTICLE IX INDEMNIFICATION |
66 | |||
9.1 Survival |
66 | |||
9.2 General Indemnification of Buyers |
67 | |||
9.3 Indemnification of Sellers |
67 | |||
9.4 Special Indemnification Provisions |
68 | |||
9.5 Time Limitations |
68 | |||
9.6 Limitations on Amount |
69 | |||
9.7 Procedures for Making Claims |
70 | |||
9.8 Other Matters Relating to Indemnification |
72 | |||
9.9 Exclusive Remedy |
72 | |||
9.9 Special Limitation on Claims |
72 | |||
ARTICLE X TERMINATION |
73 | |||
10.1 Termination of Agreement |
73 | |||
10.2 Availability of Remedies at Law; Survival of Certain Obligations |
73 | |||
ARTICLE XI MISCELLANEOUS |
74 | |||
11.1 Interpretive Provisions; Certain Definitions |
74 | |||
11.2 Expenses |
74 | |||
11.3 Entire Agreement; Amendments and Waivers; Conflicts |
74 | |||
11.4 Severability |
75 | |||
11.5 Notices |
75 | |||
11.6 Counterparts |
76 | |||
11.7 Governing Law; Waiver of Trial by Jury |
77 |
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11.8 Consent to Jurisdiction and Service of Process |
77 | |||
11.9 Benefits of Agreement |
78 | |||
11.10 Non Disclosure Agreement |
78 | |||
11.11 Public Announcements |
78 | |||
11.12 No Third Party Beneficiaries |
78 | |||
11.13 Further Assurances |
79 |
Appendices:
Appendix A — Acquired Subsidiaries
Appendix B — Shares Owned by Sellers to be Transferred at Closing
Appendix C — List of Director and Officer Resignations
Appendix D — Acquired Subsidiaries: Corporate Information
Appendix B — Shares Owned by Sellers to be Transferred at Closing
Appendix C — List of Director and Officer Resignations
Appendix D — Acquired Subsidiaries: Corporate Information
Exhibits:
Exhibit A — Form Legal Opinion
Exhibit B — Form Charter Agreement
Exhibit C — Form of Put and Call Agreement
Exhibit D — Form of Secondment Agreement
Exhibit E — Form Sublease Agreement
Exhibit F — Sublease Guaranty
Exhibit B — Form Charter Agreement
Exhibit C — Form of Put and Call Agreement
Exhibit D — Form of Secondment Agreement
Exhibit E — Form Sublease Agreement
Exhibit F — Sublease Guaranty
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THIS SHARE PURCHASE AGREEMENT (this “Agreement”), dated as of September 30, 2009, by
and among WOOD GROUP E.&P.F. HOLDINGS, INC., a Delaware corporation, WOOD GROUP HOLDINGS
(INTERNATIONAL) LIMITED, a limited company incorporated in Scotland, United Kingdom, and WOOD GROUP
ENGINEERING AND OPERATIONS SUPPORT LIMITED, a limited company incorporated in Scotland, United
Kingdom (each a “Buyer” and collectively, the “Buyers”), XXXXXXX XXXXX CORPORATION,
a Pennsylvania corporation (“Xxxxx”), XXXXX HOLDING CORPORATION, a Delaware corporation,
XXXXX OTS, INC., a Delaware corporation, and XXXXXXX XXXXX INTERNATIONAL, INC., a Delaware
corporation (each of Xxxxx, Xxxxx Holding Corporation, Xxxxx OTS, Inc., and Xxxxxxx Xxxxx
International, Inc., a “Seller” and collectively, the “Sellers”). Buyers and the
Sellers are sometimes referred to herein individually as a “Party” and, collectively, as
the “Parties”.
RECITALS
WHEREAS, the Sellers directly own the issued and outstanding capital stock and other equity
interests of each of the subsidiaries of the Sellers as set forth on Appendix B (collectively, the
“Shares”); and
WHEREAS, subject to the terms and conditions set forth herein, the Sellers desire to sell to
Buyers, and Buyers desire to purchase from the Sellers, all of the Shares.
NOW, THEREFORE, the Sellers agree to sell, convey, deliver and transfer the Shares to Buyers
and Buyers agree to purchase the Shares from the Sellers for the consideration and on the terms set
forth in this Agreement and the Parties agree to enter into the other agreements contemplated by
this Agreement.
AGREEMENT
The Parties, intending to be legally bound and obligated, covenant and agree as follows:
ARTICLE I
DEFINITIONS
DEFINITIONS
1.1 Definitions. Capitalized terms used in this Agreement are defined in this Section 1.1 or
elsewhere in this Agreement, and shall have the meanings therein ascribed to such terms.
“30-Day Period” has the meaning set forth in Section 2.4(d)(i).
“Accounts Receivable” means all accounts, notes and other receivables of the Acquired
Subsidiaries.
“Acquired Subsidiary” and “Acquired Subsidiaries” means those direct and
indirect subsidiaries of the Sellers that are being acquired by Buyers pursuant to this Agreement
and listed on Appendix A attached hereto.
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“Affiliate” means, with respect to any Person, any Person that, directly, or
indirectly through one or more intermediaries, controls or is controlled by, or is under common
control with, the Person specified.
“Affiliated Group” means any affiliated group within the meaning of Code §1504(a) or
any similar group defined under a similar provision of state, local, or foreign Law.
“Agreement” has the meaning set forth in the Preamble.
“Ancillary Agreements” means the Thailand Share Purchase Agreement, the Transition
Services Agreement, the Sublease Agreement, the Sublease Guaranty, the Charter Agreement, the
Secondment Agreement and the Put and Call Agreement.
“Anti-Indemnity Claims” has the meaning set forth in Section 9.4(c).
“Anti-Indemnity Law” means any Law concerning the validity or enforceability of
indemnification provisions (and insurance relating thereto) including, but without limitation, the
Texas Oilfield Anti-Indemnity Act (Tex. Civ. Prac. & Rem. Code Xxx. §§ 127.001-127.008), the
Louisiana Oilfield Indemnity Act (La. Rev. Stat. Xxx.§9.2780) and the Wyoming Oilfield
Anti-Indemnity Act (Wyo. Stat. Xxx. § 30-1-131 (2002)).
“Arbitrating Accountants” has the meaning set forth in Section 2.4(d)(iii).
“Asserted Liability” has the meaning set forth in Section 9.7(a).
“Assets” means all of the assets, properties (real, personal, or mixed, tangible or
intangible) and rights owned or held by any Acquired Subsidiary.
“Xxxxx” has the meaning set forth in the Preamble.
“Basket” has the meaning set forth in Section 9.6(b).
“Breach” — a “Breach” of a representation, warranty, covenant, obligation, or
other provision of this Agreement or any instrument delivered pursuant to this Agreement will be
deemed to have occurred if there is or has been (a) any inaccuracy in or breach of, or any failure
to perform or comply with, such representation, warranty, covenant, obligation, or other provision,
or (b) any claim (by any Person) or other occurrence or circumstance that is or was inconsistent
with such representation, warranty, covenant, obligation, or other provision, and the term “Breach”
means any such inaccuracy, breach, failure, claim, occurrence, or circumstance.
“Business” means all businesses and operations of the Acquired Subsidiaries as
conducted as of the Closing Date.
“Business Day” means a day that is not a Saturday, Sunday or a day on which commercial
banking institutions located in the United States are authorized or required to close.
“Buyer” and “Buyers” has the meaning set forth in the Preamble.
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“Buyer Indemnified Party” and “Buyer Indemnified Parties” have the meaning set
forth in Section 9.2.
“Cap” has the meaning set forth in Section 9.6(c).
“CERCLA” has the meaning set forth in Section 4.14(b)(i).
“Charter Agreement” means that certain Fleet Time Charter Agreement between Xxxxx
Vessels, Inc. and Xxxxx M/O Services, Inc. in the form attached hereto as Exhibit B.
“Claims” has the meaning set forth in Section 7.2(g).
“Claims Notice” has the meaning set forth in Section 9.7(a).
“Closing” has the meaning set forth in Section 2.2.
“Closing Balance Sheet” has the meaning set forth in Section 2.4(c).
“Closing Date” has the meaning set forth in Section 2.2.
“Closing Payment” has the meaning set forth in Section 2.3(a).
“Code” means the Internal Revenue Code of 1986, as amended.
“Confidential Information” has the meaning set forth in Section 7.2(f).
“Contemplated Transactions” means all of the transactions contemplated by this
Agreement, including the Closing and the performance by Buyers and Sellers of their respective
covenants and obligations under this Agreement.
“Contract” means any agreement, contract, obligation, promise, or undertaking (whether
written or oral and whether express or implied) that is legally binding.
“Current Policies” has the meaning set forth in Section 4.11(a).
“Customs and International Trade Laws” means any Law, executive order, permit,
license, directive, Order, award, or other decision or Law having the force or effect of Law, of
any Governmental Authority, concerning the importation of merchandise, the export or re-export of
products (including technology and services), the terms and conduct of international transactions,
and making or receiving international payments, including but not limited to the Tariff Act of 1930
as amended and other Laws and programs administered or enforced by the United States Customs
Service and its successor agencies, the Export Administration Act of 1979 as amended, the Export
Administration Regulations, the International Emergency Economic Powers Act as amended, the Arms
Export Control Act, the International Traffic in Arms Regulations, any other export controls
administered by an agency of the United States government, the Uniting and Strengthening America by
Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001, Executive
Orders of the President regarding embargoes and restrictions on transactions with designated
entities (including countries,
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terrorists, organizations and individuals), the embargoes and restrictions administered by the
United States Office of Foreign Assets Control, the Money Laundering Control Act of 1986 as
amended, requirements for the marking of textiles and wearing apparel, prohibitions or restrictions
on the importation of merchandise made with the use of slave or child labor, the FCPA, the
anti-boycott regulations administered by the United States Department of Commerce, the anti-boycott
regulations administered by the United States Department of the Treasury, legislation and
regulations of the United States and other countries implementing the North American Free Trade
Agreement, anti-dumping and countervailing duty Laws and regulations, and Laws and regulations
adopted by the governments or agencies of other countries concerning the ability of U.S. persons to
own businesses or conduct business in those countries, restrictions by other countries on holding
foreign currency or repatriating funds, or otherwise relating to the same subject matter as the
United States statutes and regulations described above.
“Customer Owned Vessels” has the meaning set forth in Section 4.17(a).
“Damages” means any damages, dues, penalties, royalties, fines, costs, amounts paid in
settlement, liabilities, obligations, Taxes, liens, losses, expenses, and fees, including court
costs and reasonable attorneys’ fees and expenses and costs of investigation, provided that Damages
should not include any special, incidental, consequential or punitive damages (unless awarded in
connection with a third party claim and except as specifically provide in Section 9.4).
“Deficiency Amount” has the meaning set forth in Section 2.4(e)(ii).
“Disclosure Schedule” has the meaning set forth in the introduction to Article
IV.
“Effective Time” has the meaning set forth in Section 2.2.
“Encumbrances” means any charge, claim, community property interest, condition,
equitable interest, lien, option, pledge, mortgage, security interest, right of first refusal, or
restriction of any kind, including any restriction on use, voting, transfer, receipt of income, or
exercise of any other attribute of ownership.
“Environmental, Health and Safety Requirements” has the meaning set forth in
Section 4.14(b)(i).
“Environmental Permits” has the meaning set forth in Section 4.14(c)(v).
“ERISA” means the Employee Retirement Income Security Act of 1974, as amended.
“Excluded Claims” has the meaning set forth in Section 9.6(b).
“Existing Bonds” means the following existing bonds issued by Chubb Surety and as to
which Xxxxx/MO Services, Inc. is the principal: (i) Bond #104739025 (State of Wyoming — Ten Acre
Exemption Permit — Bow and Arrow Scoria Pit) in the bond amount of $10,000; (ii) Bond #81971343
(State of Wyoming — Ten Acre Exemption Permit — Gravel Pit) in the bond amount of $10,000; (iii)
Bond #82032637 (City of Sheridan, New York Compliance Bond) in the bond amount of $10,000; (iv)
Bond #81971349 (State of Montana — Reclamation Bond for open cut mining) in the bond amount of
$86,482; (v) Bond #81971347 (Governor of the State of Texas
4
Notary Public Bond) in the bond amount of $10,000; and (vi) the bonds identified on Section
4.3(a)(v) of the Disclosure Schedule.
“FCPA” has the meaning set forth in Section 4.13(c).
“FCPA Violations” has the meaning set forth in Section 9.4(a).
“Final Net Assets” has the meaning set forth in Section 2.4(c).
“Final Net Assets Statement” has the meaning set forth in Section 2.4(c).
“Financial Statements” has the meaning set forth in Section 4.2(a).
“Fundamental Documents” means, with respect to any Person, whether foreign or
domestic, those instruments that (i) define its existence, as filed or recorded with the applicable
Governmental Authority, including a corporation’s articles or certificate of incorporation or
amalgamation and (ii) otherwise govern its internal affairs, including its operating agreement or
by-laws, as the same have been amended, supplemented, or restated to the date hereof.
“Fundamental Representation” has the meaning set forth in Section 9.6(b).
“GAAP” means generally accepted accounting principles of the United States as in
effect from time to time.
“Governmental Authority” means any:
(a) nation, state, county, city, town, village, district, or other jurisdiction of any nature;
(b) federal, state, local, municipal, foreign, or other government;
(c) governmental or quasi-governmental authority of any nature (including any governmental
agency, branch, department, official, or entity and any court or other tribunal);
(d) multi-national organization or body; or
(e) body exercising, or entitled to exercise, any administrative, executive, judicial,
legislative, police, regulatory, or taxing authority or power of any nature.
“Government Authorization” means any approval, filing, Order, consent, license,
Permit, waiver, or other authorization, registration, designation, declaration or qualification
issued, granted, given, or otherwise made available by or under the authority of any Governmental
Authority or pursuant to any Law.
“Hazardous Materials” has the meaning set forth in Section 4.14(b)(ii).
“Immediate Family Member” means, with respect to any natural person, (a) such person’s
spouse, parents, grandparents, children, grandchildren and siblings, (b) such person’s former
spouses and current spouses of such person’s children, grandchildren and siblings and (c)
5
estates, trusts, partnerships and other entities of which substantially all of the interest is
held directly or indirectly by the foregoing.
“Indemnified Party” has the meaning set forth in Section 9.7.
“Indemnifying Party” has the meaning set forth in Section 9.7.
“Insurance Reserve” means the aggregate value of all reserves for Insured Claims
included on the Closing Balance Sheet.
“Insured Claim” means any claim against an Acquired Subsidiary that arises from an
action (or actions), inaction (or inactions) or other event or events occurring prior to the
Effective Time and is the type of claim covered by the property and general liability, marine, auto
and/or workers’ compensation insurance policies under which such Acquired Subsidiary is covered,
including (i) any claim up to the $500,000 deductible per claim for any worker’s compensation
insured claim under the worker’s compensation policy, (ii) any claim up to the $1,000,000
self-insured retention per claim for any general liability insurance policy claim and up to the
applicable deductible under the general liability marine and auto insurance policies
notwithstanding the applicability of any Anti-Indemnity Law to such claims, other than an insurance
policy or insurance policies acquired by Buyers or any Acquired Subsidiary after the Effective
Time.
“Intellectual Property Rights” means (i) rights in patents, patent applications and
patentable subject matter, whether or not the subject of an application, (ii) rights in trademarks,
service marks, trade names, trade dress and other designators of origin, registered or
unregistered, (iii) rights in copyrightable subject matter or protectable designs, registered or
unregistered, (iv) trade secrets, (v) rights in internet domain names, uniform resource locators
and e-mail addresses, (vi) rights in semiconductor topographies (mask works), registered or
unregistered, (vii) know-how and (viii) all other intellectual and industrial property rights of
every kind and nature and however designated, whether arising by operation of Law, Contract,
license or otherwise.
“Interim Financial Statements” has the meaning set forth in Section
4.2(a)(ii).
“IRS” means the United States Internal Revenue Service.
“Knowledge” has the meaning set forth in Section 11.1(a).
“Law” means any federal, state, local, municipal, foreign, international,
multinational, or other administrative order, ruling, decree, constitution, law, ordinance,
principle of common law, regulation, statute, code, treaty, rule of law (including common law), or
any legal requirement of any Governmental Authority or any binding agreement with any Governmental
Authority binding upon a Person or its assets.
“Leased Real Property” has the meaning set forth in Section 4.5(b).
“Legal Actions” means any legal actions, claims, demands, arbitrations, hearings,
charges, complaints, investigations, examinations, indictments, litigations, suits or other civil,
6
criminal, administrative or investigative proceedings, at law, in equity or otherwise, by or
before any Governmental Authority.
“Liability” means any liability or obligation of whatever kind or nature (whether
known or unknown, whether asserted or unasserted, whether absolute or contingent, whether accrued
or unaccrued, whether liquidated or unliquidated, and whether due or to become due), including any
liability for Taxes.
“Licensed-In Intellectual Property Rights” means Third-Party Intellectual Property
Rights used or held for use by any of the Acquired Subsidiaries with the permission of the owner.
“Material Adverse Effect” means any change, effect, event, occurrence, state of facts
or development that results in or could, with the passage of time, reasonably be expected to
result, individually or in the aggregate, in an adverse effect on the business, properties, assets,
condition (financial or otherwise) or results of operations of the Business in excess of $750,000;
provided, however, that none of the following shall be deemed, either alone or in combination, to
constitute, and the following shall not be taken into account in determining whether there has been
or will be, a Material Adverse Effect: (a) any failure of the Acquired Subsidiaries to meet
internal projections or forecasts or revenue or earnings predictions for any period ending (or for
which revenues or earnings are released) on or after the date of this Agreement; (b) any adverse
change, effect, event, occurrence, state of facts or development to the extent attributable to the
announcement or pendency of the transactions contemplated hereby (including any cancellations of or
delays in customer orders, any reduction in sales, any disruption in supplier, distributor, partner
or similar relationships or any loss of employees); (c) any adverse change, effect, event,
occurrence, state of facts or developments attributable to conditions affecting the industries in
which the Acquired Subsidiaries participate, the U.S. economy as a whole or foreign economies in
any locations where the Acquired Subsidiaries have registrations, operations or sales, or (d) any
adverse change, effect, event, occurrence, state of facts or developments arising from or relating
to any change in accounting requirements or principles or any change in applicable laws, rules or
regulations or the interpretation thereof.
“Material Contracts” has the meaning set forth in Section 4.3(a).
“NDA” has the meaning set forth in Section 11.10.
“Net Assets” has the meaning set forth in Section 2.4(b).
“Northbelt Lease Agreement” means the Lease Agreement dated August 31, 2005 between
Northbelt Office Center II, L.P. and Xxxxx/MO Services, Inc.
“Notice of Adjustment” has the meaning set forth in Section 2.4(c).
“Objection Notice” has the meaning set forth in Section 2.4(d)(ii).
“Off-the-Shelf Software” means Software that is widely commercially available for a
price of less than $1,000 for any number of users or less than $1,000 per seat, PC, CPU or user.
7
“Order” any award, decree, decision, injunction, judgment, order, ruling, subpoena, or
verdict entered, issued, made, or rendered by any court, administrative agency, or other
Governmental Authority or by any arbitrator.
“Ordinary Course of Business” means an action taken by a Person which is consistent
with the past customs and practices of such Person and is taken in the ordinary course of the
normal operations of such Person.
“Owned Intellectual Property Rights” means Intellectual Property Rights owned by any
of the Acquired Subsidiaries
“Owned Vessels” has the meaning set forth in Section 4.17(a).
“Parent Company Guarantee” has the meaning set forth in Section 7.2(e).
“Party” and “Parties” have the meaning set forth in the Preamble.
“Permits” means any franchises, grants, authorizations, licenses, registrations,
easements, variances, exceptions, consents, certificates, approvals and other permits of any
Governmental Authority.
“Permitted Encumbrances” means (i) Encumbrances for current Taxes (as defined below)
not yet due and payable, and (ii) Encumbrances of materialmen, carriers, landlords and like
Persons, all of which are not yet due and payable.
“Person” means any individual, corporation, association, limited liability company,
partnership, joint venture or other entity or organization of any kind.
“Plan” means every plan, fund, Contract, program and arrangement (whether written or
not) for the benefit of present or former employees or other service providers or their respective
spouses or dependents, including those intended to provide (i) medical, surgical, health care,
hospitalization, dental, vision, workers’ compensation, life insurance, death, disability, legal
services, severance, sickness or accident benefits (whether or not defined in Section 3(1) of
ERISA), (ii) pension, profit sharing, stock bonus, retirement, supplemental retirement or deferred
compensation benefits (whether or not tax qualified and whether or not defined in Section 3(2) of
ERISA) including, without limitation, any multiemployer plan as defined in Section 3(37) of ERISA
or a multiple employer welfare arrangement as defined in Section 3(40)(A) of ERISA, or (iii) salary
continuation, unemployment, supplemental unemployment, severance, termination pay,
change-in-control, vacation or holiday benefits (whether or not defined in Section 3(3) of ERISA),
(w) that is maintained or contributed to by any Acquired Subsidiary, (x) that any Acquired
Subsidiary has committed to implement, establish, adopt or contribute to in the future, (y) for
which any Acquired Subsidiary is or may be financially liable as a result of the direct sponsor’s
affiliation with any Acquired Subsidiary, or such Acquired Subsidiary’s shareholders (whether or
not such affiliation exists at the date of this Agreement and notwithstanding that the Plan is not
maintained by any Acquired Subsidiary for the benefit of its employees or former employees or other
service providers or their respective spouses or dependents) including, without limitation, any
multiemployer plan as defined in Section 3(37) of ERISA or a multiple employer welfare arrangement
as defined in Section 3(40)(A) of ERISA, or (z) for or with
8
respect to which any Acquired Subsidiary is or may become liable under any common law
successor doctrine, express successor liability provisions of Law, provisions of a collective
bargaining agreement, labor or employment Law or agreement with a predecessor employer. Plan does
not include any arrangement that has been terminated and completely wound up prior to the date of
this Agreement and for which no Acquired Subsidiary has any present or potential liability.
“Pre-Closing Tax Period” has the meaning set forth in Section 8.1.
“Purchase Price” has the meaning set forth in Section 2.3(a).
“Put and Call Agreement” means that certain Put and Call Option Agreement between
Xxxxx Vessels, Inc. and Xxxxx M/O Services, Inc. in the form attached hereto as Exhibit C.
“RCRA” has the meaning set forth in Section 4.14(b)(i).
“Real Property Lease” has the meaning set forth in Section 4.5(b).
“Registered Intellectual Property Rights” means Intellectual Property Rights of an
Acquired Subsidiary that are the subject of a pending application or an issued patent, trademark,
copyright, design right or other similar registration formalizing exclusive rights.
“Related Party” means any Affiliate and each equity holder, member of the board of
directors, or officer of an Acquired Subsidiary or an Immediate Family Member or Affiliate thereof,
including, specifically, any Seller; provided, however, that an Acquired Subsidiary shall not be
deemed to be a Related Party of another Acquired Subsidiary.
“Release” has the meaning set forth in Section 4.14(b)(iii).
“Released Matters” has the meaning set forth in Section 7.2(g).
“Releasee” and “Releasees” have the meaning set forth in Section
7.2(g).
“Remaining Disputed Items” has the meaning set forth in Section 2.4(d)(iii).
“Replacement Bonds” has the meaning set forth in Section 7.2(n).
“Retained Liabilities” has the meaning set forth in Section 2.4(a).
“Secondment Agreement” means that certain Secondment Agreement between Xxxxx Vessels,
Inc. and Xxxxx M/O Services, Inc. in the form attached hereto as Exhibit D.
“Seller” and “Sellers” has the meaning set forth in the Preamble.
“Shares” has the meaning set forth in the Recitals.
“Share Register Instruments” means the items referred to in Section 3.1(i) (ii)
through (xiii).
9
“Software” means computer programs or data in computerized form, whether in object
code, source code or other form.
“Storm Cat Receivables” has the meaning set forth in Section 2.4(b).
“Straddle Period” has the meaning set forth in Section 8.2.
“Sublease Agreement” means the Sublease Agreement in the form attached hereto as
Exhibit E which is to be entered into and delivered before the Closing by and between Xxxxx/MO
Services, Inc. as Sublessor and Xxxxxxx Xxxxx Jr., Inc. as Sublessee with respect to the portion of
the Houston office facility which is to be subleased by Xxxxxxx Xxxxx Jr., Inc.
“Sublease Guaranty” means the Sublease Guaranty in the form attached as Exhibit F
which is to be executed and delivered before the Closing by Xxxxxxx Xxxxx Corporation.
“Subsidiary” means, as of the applicable point in time, each corporation, partnership,
limited liability company or other entity of which the applicable party owns, directly or
indirectly, more than fifty percent (50%) of the outstanding voting securities or equity interests.
“Surplus Amount” has the meaning set forth in Section 2.4(e)(iii).
“Tax” and “Taxes” means any federal, state, local, or foreign income, gross
receipts, license, payroll, employment, excise, severance, stamp, occupation, premium, windfall
profits, environmental, customs duties, capital stock, franchise, profits, withholding, social
security (or similar), unemployment, workers’ compensation, disability, real property, personal
property, sales, use, service transfer, registration, value added, alternative or add-on minimum,
estimated, or other tax, duty, impost or charge of any kind whatsoever, including any interest,
penalty, or addition thereto, whether disputed or not, and any transferee liability in respect of
any item described in this definition.
“Tax Return” means any return (including any information return), report, statement,
schedule, notice, form, or other document or information filed with or submitted to, or required to
be filed with or submitted to, any Governmental Authority in connection with the determination,
assessment, collection, or payment of any Tax or in connection with the administration,
implementation, or enforcement of or compliance with any Law relating to any Tax.
“Targeted Net Assets” has the meaning set forth in Section 2.4(a).
“Third Party Claim” has the meaning set forth in Section 9.7(c)(i).
“Third-Party Intellectual Property Rights” means Intellectual Property Rights in which
a Person other than an Acquired Subsidiary has any ownership interest.
“Transaction Document” means this Agreement, the Ancillary Agreements, and any
agreements, instruments, certificates and documents required to be executed and delivered pursuant
hereto or in connection herewith.
10
“Unbilled Accounts Receivable” means cost of Contracts in progress and estimated
earnings, less xxxxxxxx of the Acquired Subsidiaries.
1.2 Accounting Terms and Determinations. Unless otherwise specified herein, all accounting terms
used herein shall be interpreted and all accounting determinations hereunder shall be made in
accordance with GAAP.
ARTICLE II
PURCHASE AND SALE OF THE SHARES
PURCHASE AND SALE OF THE SHARES
2.1 Purchase and Sale of the Shares.
At the Closing, on the terms and subject to the conditions contained herein, the Sellers shall
sell, transfer, assign, convey and deliver all of the Shares to Buyers free and clear of any
Encumbrances, and Buyers shall purchase and accept all of the Shares from the Sellers.
2.2 Closing.
The closing of the purchase and sale of the Shares (the “Closing”) shall take place at
the offices of Xxxx Xxxxx LLP, 000 Xxxxx Xxxxxx, Xxxxxxxxxx, Xxxxxxxxxxxx 00000 on the later of
September 30, 2009, or at such other time and place as the Parties may agree (the “Closing
Date”). The Closing shall be deemed effective at 11:59 p.m. on the Closing Date (the
“Effective Time”). Subject to the provisions of Article X, failure to consummate
the purchase and sale provided for in this Agreement on the date and time and at the place
determined pursuant to this Section 2.2 will not result in the termination of this
Agreement and will not relieve any Party of any obligation under this Agreement.
2.3 Purchase Price.
(a) Purchase Price. The purchase price for the Shares shall be Thirty-Seven Million
Nine Hundred Forty Four Thousand Dollars ($37,944,000) (the “Purchase Price”), which is
subject to an adjustment after Closing as provided in Section 2.4 below, which shall be
paid by Buyers at the Closing upon surrender by Sellers of the Shares in cash (such amount, the
“Closing Payment”). The Closing Payment shall be allocated among and paid to each Seller,
by wire transfer of immediately available funds to the following account to be allocated among the
Sellers as follows:
Citizens Bank
Riverside, RI
ABA:
Swift:
Riverside, RI
ABA:
Swift:
Xxxxxxx Xxxxx Corporation
000 Xxxxxxx Xxxxx
Xxxxxxx Xxxxxxxx Xxxx
Xxxx Xxxxxxxx, XX 00000
000 Xxxxxxx Xxxxx
Xxxxxxx Xxxxxxxx Xxxx
Xxxx Xxxxxxxx, XX 00000
Account No.:
11
Seller | Dollar Amount Allocation of Closing Payment | |||
Xxxxxxx Xxxxx Corporation |
$ | 15,990 | ||
Xxxxxxx Xxxxx International, Inc. |
$ | 755,820 | ||
Xxxxx Holding Corporation |
$ | 19,890,000 | ||
Xxxxx OTS Inc. |
$ | 17,282,190 |
(b) Purchase Price Allocation. The Purchase Price shall be allocated among the Shares
as follows:
Percentage Purchase Price | ||||
Shares / Company | Allocation | |||
1,000 shares of Xxxxxxx Xxxxx Global, Inc. |
0.042 | % | ||
1,000 shares of Xxxxx/MO Services, Inc. |
52.420 | % | ||
9,900 shares of Xxxxx Energy de Venezuela, C.A. |
1.992 | % | ||
1,000 shares of Xxxxx O&M International, Ltd. |
0.003 | % | ||
2,665 shares of Overseas Technical Services
International, Ltd. |
39.376 | % | ||
100 shares of Xxxxx OTS International, Inc. |
4.111 | % | ||
2,665 shares of OTS Finance and Management Ltd. |
2.056 | % | ||
1,000 shares of SD Forty Five Limited |
0.000 | % |
(c) Termination and Waiver of Certain Rights. Each of the Sellers hereby waives any
preemptive rights that such Party may have, including, without limitation, those preemptive rights
under the Fundamental Documents of the Acquired Subsidiaries or any other agreement by and among
any Acquired Subsidiary and any Seller, with respect to the consummation of the Closing.
12
2.4 Purchase Price Adjustment.
(a) Purchase Price Assumptions. The Purchase Price is based upon the assumption that
Net Assets (defined below) transferred at Closing to Buyers will be equal to the Net Asset
Threshold (the “Targeted Net Assets”) and that Buyers and the Acquired Subsidiaries (1)
shall not assume or otherwise be responsible for any of the liabilities or obligations of the
Acquired Subsidiaries or BES to the Sellers or any of Sellers’ direct or indirect subsidiaries or
Affiliates (excluding the Acquired Subsidiaries and BES), (2) such amounts shall not be treated as
liabilities of the Acquired Subsidiaries or BES for purposes of calculating Targeted Net Assets or
BES Net Assets in this Section 2.4, and (3) such amounts shall be and are hereby assumed by Xxxxx
at the Closing (the “Retained Liabilities”). The Net Asset Threshold shall be calculated
and determined as follows:
Net Asset Threshold equals the sum of $31,350,000 plus the Vessel Proceeds plus the
BES Adjustment
For purposes of determining the Net Asset Threshold, the following definitions and calculations
shall be applicable:
“Vessel Proceeds” will equal the net proceeds received by Xxxxx Vessels, Inc. in respect of the
sale of the Owned Vessels under the terms of the Put and Call Agreement plus any insurance proceeds
received or receivable by Xxxxx Vessels Inc. with respect to any of the Owned Vessels unless such
proceeds are used to repair or replace.
“BES Adjustment” will equal whichever of the following three alternatives is applicable:
(i) If Wood Group Holdings (International) Limited acquires, pursuant to and in accordance with
the BES Share Purchase Agreement, 79.7% of B.E.S. Energy Resources Company Limited, a Thailand
Joint Venture (“BES”) from Sellers, then the amount of the BES Adjustment will be zero;
(ii) If , pursuant to and in accordance with the BES Share Purchase Agreement, Wood Group
Holdings (International) Limited does not acquire any shares of capital stock in BES from
Sellers, then the BES Adjustment will be calculated and determined as follows:
[(BES Net Assets Less BES Net Cash Plus BES Intercompany Debt) * 79.7%] *
-1
(iii) If, pursuant to and in accordance with the BES Share Purchase Agreement, Wood Group
Holdings (International) Limited acquires 100% of the capital stock of BES from Sellers, then
the BES Adjustment will be calculated as follows:
[(BES Net Assets Less BES Net Cash Plus BES Intercompany Debt) * 20.3%]
The following terms shall have the following meanings for purposes of the calculations referred
to herein:
13
“BES Net Assets” means (A) the total assets of BES minus (B) the total liabilities of BES,
calculated in accordance with GAAP and using the same accounting methods, policies, practices,
and procedures, with consistent classification, judgments, and estimation methodology as were
used by BES in preparing the BES financial statements for the year ending December 31, 2008
(provided that in the event of any conflict between GAAP and consistency, GAAP will control);
“BES Net Cash” means the actual cash holdings of BES minus (i) the total value of all
bank, lease, hire purchase, and other similar debt and (ii) debt owed by BES to affiliates of
BES other than the Acquired Subsidiaries, all at the date of this Agreement; and
“BES Inter Company Debt” means the total debt owed by BES to the Acquired Subsidiaries at the
date of this Agreement.
(b) Net Assets. “Net Assets” means (A) the total assets of the Acquired
Subsidiaries minus (B) the total liabilities of the Acquired Subsidiaries, calculated in accordance
with GAAP and using the same accounting methods, policies, practices, and procedures, with
consistent classification, judgments, and estimation methodology as were used by the Acquired
Subsidiaries in preparing the Financial Statements (provided that in the event of any conflict
between GAAP and consistency, GAAP will control), provided however, (i) the liabilities of the
Acquired Subsidiaries shall not include the Retained Liabilities, (ii) no value will be assigned to
the accounts receivable owed to Xxxxx or the Acquired Subsidiaries arising from pre-petition claims
of the Chapter 11 filing by Storm Cat Energy (USA) Operating Companies and any of its Affiliates
(the “Storm Cat Receivables”); and (iii) goodwill will not be included in total assets.
Schedule 2.4(b) attached hereto contains an example of the calculation for Net Assets.
(c) Preparation of Closing Statements. As promptly as practicable following the
Closing Date, but in no event more than sixty (60) Business Days after the Closing Date, Buyers, at
their sole expense, shall prepare and deliver to the Sellers a notice (the “Notice of
Adjustment”) of Buyers setting forth its proposed adjustment, if any, of the Purchase Price as
contemplated under this Section 2.4, along with (i) an unaudited combined balance sheet of
the Acquired Subsidiaries as of the Effective Time (the “Closing Balance Sheet”), and (ii)
a statement (the “Final Net Assets Statement”) setting forth Buyers’ proposed computation
of the Net Assets as of the Effective Time (the “Final Net Assets”). Both the Closing
Balance Sheet and the Final Net Assets Statement shall be prepared in accordance with GAAP using
the same accounting methods, policies, practices, and procedures, with consistent classification,
judgments, and estimation methodology as were used by the Acquired Subsidiaries in preparing the
Financial Statements (provided that in the event of any conflict between GAAP and consistency, GAAP
will control); provided, however, that for purposes of preparing the Final Net Assets Statement,
Net Assets shall be calculated and determined in accordance with Section 2.4(b) above. The Vessel
Proceeds component shall be determined as of the date of Xxxxx Vessels Inc.’s receipt of the Vessel
Proceeds and the Parties shall cooperate to provide all relevant information to each other with
respect to such Vessel Proceeds in a timely manner. The amount of the BES Adjustment shall be
determined by Buyer within forty-five days following the closing of the transactions contemplated
by the BES Share Purchase Agreement. It is agreed that the amount of the Vessel Proceeds and BES
Adjustment may be determined following the date that Closing Balance Sheet and Final Net Assets
Statement are resolved and finalized.
14
(d) Review by the Sellers.
(i) Following receipt of the Notice of Adjustment, the Sellers will be
afforded a period of thirty (30) Business Days (the “30-Day Period”) to review the
Notice of Adjustment. During the 30-Day Period, Buyers shall provide the Sellers and their
advisors with reasonable access upon prior written request to the Acquired Subsidiaries’
books and records, as well as the right to make copies of all such books and records of the
Acquired Subsidiaries, in each case, as related to the preparation of the Closing Balance
Sheet and the preparation of the Final Net Assets Statement. Buyers shall also provide the
Sellers with reasonable access upon prior written request to work papers, trial balances and
similar materials used in connection with preparing the Closing Balance Sheet and the Final
Net Assets Statement and shall allow the Sellers to make copies thereof. Following receipt
of notice of the BES Adjustment, the Sellers will be afforded a 30-Day Period to review the
amount of the BES Adjustment (the “BES 30”). During the BES 30, Buyers shall provide the
Sellers and their advisors with reasonable access upon prior written request to BES’ books
and records, as well as the right to make copies of all such books and records of BES, in
each case, as related to the preparation of the BES closing balance sheet and the
preparation of the BES Final Net Assets Statement. Buyers shall also provide the Sellers
with reasonable access upon prior written request to work papers, trial balances and similar
materials used in connection with preparing the closing balance sheet and the final net
assets statement of BES and shall allow the Sellers to make copies thereof.
(ii) At or before the end of the 30-Day Period, the Sellers will either
(A) accept the Final Net Assets (as set forth in the Notice of Adjustment) in its entirety,
in which case the Final Net Assets will be as set forth in the Notice of Adjustment or
(B) deliver to Buyers a written notice (the “Objection Notice”) containing a
reasonably detailed written explanation of the specific items in the Final Net Assets
Statement or the Closing Balance Sheet which the Sellers dispute, in which case the Final
Net Assets Statement shall be deemed to be in dispute. The failure by the Sellers to
deliver the Objection Notice within the 30-Day Period shall constitute the Sellers’
acceptance of the Final Net Assets as set forth in the Notice of Adjustment and the Final
Net Assets as calculated by the Buyers shall be binding and conclusive on the Parties and
will be used in determining the adjustment to the Purchase Price as set forth in Section
2.4(e). At or before the end of the BES 30, the Sellers will either (A) accept the BES
final net assets (as set forth in the BES notice of adjustment) in its entirety, in which
case the BES final net assets will be as set forth in the BES notice of adjustment or
(B) deliver to Buyers a written notice (the “BES Objection Notice”) containing a
reasonably detailed written explanation of the specific items in the BES final net assets
statement or the BES closing balance sheet which the Sellers dispute, in which case the BES
final net assets statement shall be deemed to be in dispute. The failure by the Sellers to
deliver the BES Objection Notice within the BES 30 shall constitute the Sellers’ acceptance
of the BES final net assets as set forth in the BES notice of adjustment and the BES final
net assets as calculated by the Buyers shall be binding and conclusive on the Parties and
will be used in determining the adjustment to the Purchase Price as set forth in Section
2.4(e).
15
(iii) If the Sellers deliver the Objection Notice or the BES Objection
Notice in a timely manner, then, within a further period of twenty (20) Business Days (or
such longer period as mutually agreed upon by Sellers and Buyers) from the end of the 30-Day
Period or the BES 30, as applicable, the Parties and, if desired, their respective
accountants will attempt to resolve in good faith the disputed items in the Objection Notice
or BES Objection Notice and reach a written agreement with respect thereto. Failing such
resolution, any unresolved disputed items (“Remaining Disputed Items”) will be
referred for final binding resolution to KPMG LLP or, in the event KPMG LLP is unavailable
to serve as the arbitrating accountants, then to an international accounting firm mutually
acceptable to the parties (the “Arbitrating Accountants”). If any Remaining
Disputed Items are submitted to the Arbitrating Accountants for resolution, (i) within 30
days of the engagement of the Arbitrating Accountants, each Party will submit to the
Arbitrating Accountants a written brief of its position as to the Remaining Disputed Items
and shall furnish to the Arbitrating Accountants such workpapers and other documents and
information relating to the Remaining Disputed Items as the Arbitrating Accountants may
request and are available to that Party or its Affiliates (or its independent public
accountants); (ii) each Party will be afforded the opportunity to present to the Arbitrating
Accountants any written material relating to the determination of its position as to the
Remaining Disputed Items and to discuss such determination with the Arbitrating Accountants;
(iii) the Arbitrating Accountants’ determination for the Remaining Disputed Items must be
rendered within 30 days of the submission of the Parties’ briefs as to their respective
positions on the Remaining Disputed Items; (iv) the Arbitrating Accountants’ determination
for any of the Remaining Disputed Items cannot be greater than or less than the greatest or
lowest value, respectively, claimed for that particular item in the Closing Balance Sheet,
the Final Net Assets Statement, and Notice of Adjustment delivered by the Buyers, or in the
Objection Notice delivered by the Sellers; of the BES closing balance sheet, the BES final
net assets statement, and BES notice of adjustment delivered by the Buyers, or in the
Objection Notice or BES Objection Notice delivered by the Sellers; in each case as
applicable, (v) the determination by the Arbitrating Accountants, as set forth in a written
report delivered to all Parties by the Arbitrating Accountants, will be in accordance with
the terms hereof, including GAAP, and shall be binding on, conclusive, and non-appealable
by, the Parties and their respective Affiliates and not subject to collateral attack for any
reason other than manifest error or fraud, and the Arbitrating Accountants shall not be
entitled to consider any items or matters other than the Remaining Disputed Items or BES
Remaining Dispute Items, as applicable; and (vi) the fees and expenses of the Arbitrating
Accountants shall be paid 50% by the Buyers and 50% by the Sellers. Each Party shall pay
the costs, if any, of its own accountants and advisors in connection with the adjustment to
the Purchase Price contemplated by this Section 2.4.
(e) Post Closing Adjustment.
If the Final Net Assets (as determined under this Section 2.4) equals the
Targeted Net Assets, then no adjustment shall be made to the Purchase Price and no cash
payment shall be required by either Buyers or Sellers after Closing.
16
(ii) If the Final Net Assets (as determined under this Section
2.4) is less than the Targeted Net Assets (the amount of such shortfall being referred
to herein as the “Deficiency Amount”), then the Purchase Price shall be decreased by
the amount of the Deficiency Amount and the Deficiency Amount shall be paid to the Buyers by
the Sellers in cash by wire transfer of immediately available funds within five (5) Business
Days after the final resolution of the adjustment amount by the mutual agreement of the
Parties or by the Arbitrating Accountants (or at the end of the 30-Day Period, if no
Objection Notice is delivered).
(iii) If the Final Net Assets (as determined under this Section
2.4) is greater than the Targeted Net Assets (the amount of such excess being referred
to herein as the “Surplus Amount”), then the Purchase Price shall be increased by
the amount of the Surplus Amount and Buyers shall pay to the Sellers the Surplus Amount in
cash by wire transfer of immediately available funds within five (5) Business Days after the
final resolution of the adjustment amount by the mutual agreement of the Parties or by the
Arbitrating Accountants (or at the end of the 30-Day Period, if no Objection Notice is
delivered) (such payment to be paid to the Sellers in the same proportions that the Closing
Payment is paid to the Sellers as set forth in Section 2.3(a)).
(iv) The amount of the Vessel Proceeds component of the Targeted Net
Assets shall be within five (5) Business Days following Xxxxx Vessels Inc.’s receipt of the
Vessel Proceeds.
(v) The amount of the BES Adjustment will be paid to the appropriate
Sellers within five (5) Business Days after the final resolution of the BES Adjustment
Amount by the Parties or by the Arbitrating Accountants (or at the end of the BES 30 if no
BES Objection Notice is delivered.
The rights set forth in this Section 2.4 are the sole and exclusive remedy with
respect to the subject matter of this Section 2.4. The indemnification provisions set
forth in Article IX shall not apply to the matters set forth in this Section 2.4.
ARTICLE III
CONDITIONS OF CLOSING
CONDITIONS OF CLOSING
3.1 Conditions to Obligations of Buyers.
The obligation of Buyers to consummate the Closing is subject to the satisfaction of the
following conditions (any of which may be waived in writing by Buyers in whole or in part):
(a) Representations and Warranties. Without giving effect to any disclosures made to
Buyers pursuant to Section 7.1(c), the representations and warranties of the Sellers set
forth in Articles IV and V (subject to the Disclosure Schedule) shall be true and correct
in all material respects (except for those representations and warranties qualified as to material,
materiality or Material Adverse Effect or similar expressions, which shall be true and correct in
17
all respects) as of the date of this Agreement and as of the Closing Date as though made on
and as of the Closing Date (provided that such representations and warranties which are made
expressly as of a particular date shall be true and correct as of such date).
(b) Performance of Covenants and Agreements. Each Seller shall have performed and
complied in all material respects with all of the covenants and agreements required to be performed
by it under this Agreement at or prior to the Closing;
(c) Fundamental Documents; Books and Records. Each of the Acquired Subsidiaries shall
have in its possession its respective original Fundamental Documents, minute books and governance
records, except for the original Fundamental Documents, minute books and governance records set
forth on Section 4.1(a) of the Disclosure Schedule and Section 4.2(c) of the Disclosure Schedule.
(d) Orders, Legal Actions. There shall not be any Law or Order in effect that
enjoins, prohibits or prevents the performance of this Agreement and/or the consummation of the
Contemplated Transactions. No Legal Action shall be pending or threatened before any Governmental
Authority wherein an unfavorable Order could reasonably be expected to prevent consummation of any
of the Contemplated Transactions or result in a Material Adverse Effect.
(e) Government Approvals; Third Party Consents. The Parties and the Acquired
Subsidiaries shall have received all Government Authorizations identified in Section 4.10(b) of the
Disclosure Schedule. All of the notices, consents and approvals listed on Section 4.10(a) of the
Disclosure Schedule shall have been obtained or made (as applicable) by the Sellers and/or the
Acquired Subsidiaries and shall be in full force and effect.
(f) No Material Adverse Effect. A Material Adverse Effect shall not have occurred.
(g) Transfer of Vessel Operations. (i) Xxxxx M/O Services, Inc. shall have sold and
transferred all Owned Vessels free of Encumbrances pursuant to the bills of sale between Xxxxx M/O
Services, Inc. and Xxxxx Vessels, Inc. and delivered to the Buyers an executed copy thereof; (ii)
Xxxxx M/O Services, Inc. and Xxxxx Vessels, Inc. shall have duly executed the Charter Agreement and
the Put and Call Agreement; (iii) Xxxxx M/O Services, Inc. shall have terminated the nine employees
who are full time members of the crews of the Owned Vessels, and Xxxxx shall have hired such
employees on behalf of Xxxxx Vessels, Inc. and included such employees in Xxxxx’x benefit plans;
(iv) Xxxxx Vessels, Inc. shall have filed U.S. Coast Guard CG-1258, (v) Xxxxx M/O Services, Inc.
and Xxxxx Vessels, Inc. shall have duly executed the Secondment Agreement.
(h) Xxxxx M/O Services, Inc. and Xxxxxxx Xxxxx Jr., Inc. shall have duly executed the Sublease
Agreement
(i) Xxxxxxx Xxxxx Corporation shall have duly executed the Sublease Guaranty.
(j) Closing Deliverables. The Sellers shall have delivered, or caused to be
delivered, to Buyers each of the following before or at Closing:
18
(i) the certificates (or lost share affidavits reasonably satisfactory to Buyers)
representing the Shares duly endorsed in blank for transfer;
(ii) the share register book for Xxxxx Energy de Venezuela, C.A., to be updated to
effect the consummation of the sale of the Shares of Xxxxx Energy de Venezuela, C.A.;
(iii) the share register book for Xxxxx O&M International, Ltd., to be updated to
effect the consummation of the sale of the Shares of Xxxxx O&M International, Ltd.;
(iv) an executed and notarized counterpart to the Instrument of Transfer for the sale
of the Shares of Xxxxx O&M International, Ltd., duly executed by a Person authorized to
execute and deliver the Instrument of Transfer on behalf of Xxxxx O&M International, Ltd.;
(v) the share register book for Xxxxx OTS International, Inc., to be updated to effect
the consummation of the sale of the Shares of Xxxxx OTS International, Inc.;
(vi) an executed and notarized counterpart to the Instrument of Transfer for the sale
of the Shares of Xxxxx OTS International, Inc., duly executed by a Person authorized to
execute and deliver the Instrument of Transfer on behalf of Xxxxx OTS International, Inc.;
(vii) certification of the register of members of Xxxxx O&M International, Ltd. and
Xxxxx OTS International, Inc. by the secretary or registered agent of each;
(viii) certificate of incumbency from the Registrar of Companies in the Cayman Islands
certifying the directors and officers of Xxxxx O&M International, Ltd. and Xxxxx OTS
International, Inc.
(ix) the share register book for Overseas Technical Services International, Ltd., to be
updated to effect the consummation of the sale of the Shares of Overseas Technical Services
International, Ltd.;
(x) an executed and notarized counterpart to the Transfer of Shares document for the
sale of the Shares of Overseas Technical Services International, Ltd., duly executed by a
Person authorized to execute and deliver the Instrument of Transfer on behalf of Overseas
Technical Services International, Ltd.;
(xi) the share register book for OTS Finance and Management Ltd., to be updated to
effect the consummation of the sale of the Shares of OTS Finance and Management Ltd.;
(xii) an executed and notarized counterpart to the Transfer of Shares document for the
sale of the Shares of OTS Finance and Management Ltd., duly executed
19
by a Person authorized to execute and deliver the Instrument of Transfer on behalf of
OTS Finance and Management Ltd.;
(xiii) duly executed stock transfer forms representing the Shares of SD Forty Five
Limited under UK law;
(xiv) evidence of the execution of the Ancillary Agreements;
(xv) evidence that all Encumbrances set forth in Section 4.6(a) of the Disclosure
Schedule have been removed, except for those that the Buyer agrees shall remain in place for
the equipment leases duly noted in Section 4.6(a) of the Disclosure Schedule;
(xvi) a certificate from each of the Sellers, dated as of the Closing Date, stating
that the conditions specified in subsections (a), (b) and (c) of this Section 3.1,
as they relate to such Seller and/or the Acquired Subsidiaries, as applicable, have been
satisfied;
(xvii) a certificate of the Secretary (or similar officer) of each Seller certifying
(A) that correct and complete copies of each resolution of its board of directors (or
similar governing body) approving the execution of this Agreement and the Contemplated
Transactions are attached thereto and (B) the incumbency and signature of the Persons
authorized to execute and deliver this Agreement on behalf of such Seller;
(xviii) a resignation, effective as of the Effective Time, from each director and/or
officer of the Acquired Subsidiaries set forth on Appendix C, in form and substance
reasonably satisfactory to Buyers;
(xix) certificates from appropriate Governmental Authorities, each dated as of a recent
date, as to the good standing or qualification to do business, as the case may be, of the
Acquired Subsidiaries in those jurisdictions set forth on Section 4.1(a) of the Disclosure
Schedule;
(xx) a certificate of the Secretary (or similar officer) of each Acquired Subsidiary
certifying that complete and accurate copies of (A) all Fundamental Documents in the
possession of the Acquired Subsidiaries or Sellers as of the Closing Date been given to the
Buyers and that (B) each Acquired Subsidiary is in possession of the originals of such
Fundamental Documents, its minute books and governance records, except as set forth on
Section 4.1(a) of the Disclosure Schedule and Section 4.2(c) of the Disclosure Schedule;
(xxi) an opinion from Xxxx Xxxxx, counsel to Sellers, in form and substance set forth
on Exhibit A attached hereto;
(xxii) such other documents and instruments, in form and substance reasonably
satisfactory to Buyers and their counsel, as are necessary in order to consummate the
Closing in accordance with the terms and provisions hereof.
20
(xxiii) an executed release by the banks of Xxxxx/MO Services, Inc. and Xxxxx OTS, Inc.
from any and all obligations under Sellers First Amended and Restated Loan Agreement;
(xxiv) evidence of the transfer of the Owned Vessels in accordance with Section 3.1(g)
(xxv) evidence of the Consent of Directors of Xxxxx/MO Services, Inc. approving the
sale of the capital stock of Xxxxx/MO Services, Inc. to the Buyers.
The items referred to in Section 3.1(i) (ii) through (xiii) are referred to herein as the “Share
Register Instruments”. If the Closing occurs, all Closing conditions set forth in this Section
3.1 which have not been fully satisfied as of the Closing shall be deemed to have been fully
waived by Buyers for purposes of this Section 3.1 with no further action required by the
Parties.
3.2 Conditions to Obligations of the Sellers.
The obligation of the Sellers to consummate the Closing is subject to the satisfaction of the
following conditions (any of which may be waived in writing by the Sellers in whole or in part):
(a) Representations and Warranties. The representations and warranties of Buyers set
forth in Article VI shall be true and correct in all material respects (except for those
representations and warranties qualified as to material, materiality or Material Adverse Effect or
similar expressions, which shall be true and correct in all respects) as of the date of this
Agreement and as of the Closing Date as though made on and as of the Closing Date (provided that
such representations and warranties which are made expressly as of a particular date shall be true
and correct as of such date).
(b) Performance of Covenants and Agreements. Each Buyer shall have performed and
complied in all material respects with all of the covenants and agreements required to be performed
by it under this Agreement at or prior to the Closing.
(c) Orders. There shall not be any Law or Order in effect that enjoins, prohibits or
prevents the performance of this Agreement and/or the consummation of the Contemplated
Transactions. No Legal Action shall be pending or threatened before any Governmental Authority
wherein an unfavorable Order could reasonably be expected to prevent consummation of any of the
Contemplated Transactions.
(d) Closing Deliverables. Buyers shall have delivered, or caused to be delivered, to
the Sellers each of the following at Closing:
(i) without duplication, cash payment of the amount of the Closing Payment due to the
Sellers at Closing pursuant to Section 2.3(a)(i), by wire transfer of immediately
available funds to such accounts at such banks as the Sellers shall designate in writing;
21
(ii) a certificate from each Buyer, dated as of the Closing Date, stating that the
conditions specified in subsections (a) and (b) of this Section 3.2, as they relate
to such Buyer, have been satisfied;
(iii) a certificate of the Secretary (or similar officer) of each Buyer certifying (A)
that correct and complete copies of each resolution of its board of directors (or similar
governing body) approving the execution and delivery of this Agreement and the Contemplated
Transactions are attached thereto and (B) the incumbency and signature of the Persons
authorized to execute and deliver this Agreement on behalf of such Buyer;
(iv) the Share Register Instruments which are required to be executed by Buyer by
applicable law; and
(v) such other documents and instruments, in form and substance reasonably satisfactory
to the Sellers and their counsel, as are necessary in order to consummate the transactions
contemplated hereby in accordance with the terms and provisions hereof.
If the Closing occurs, all Closing conditions set forth in this Section 3.2 which have not
been fully satisfied as of the Closing shall be deemed to have been fully waived by the Sellers for
purposes of this Section 3.2 with no further action required by the Parties.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES CONCERNING ACQUIRED
SUBSIDIARIES
REPRESENTATIONS AND WARRANTIES CONCERNING ACQUIRED
SUBSIDIARIES
Subject to any matters disclosed by the Sellers in the disclosure schedule attached hereto
(the “Disclosure Schedule”), the Sellers, jointly and severally, represent and warrant to
Buyers that the statements contained in this Article IV are true, correct and complete as
of the date of this Agreement and will be true, correct and complete as of the Closing Date (as
though made then and as though the Closing Date were substituted for the date of this Agreement
throughout this Article IV) (unless such representation or warranty expressly relates to a
specific date, in which case, as of such date). The Disclosure Schedule will be arranged in
sections and subsections corresponding to the sections and subsections contained in this Agreement,
and any information disclosed in any such section or subsection of the Disclosure Schedule shall be
deemed to be disclosed only for purposes of the corresponding section or subsection of this
Agreement.
4.1 Organization, Good Standing, Qualification and Powers; Equity Interests, Etc.
(a) Organization, Good Standing, Qualification and Powers. Appendix D contains, for
each Acquired Subsidiary, a complete and accurate list of its name, its jurisdiction of
incorporation or formation, and other jurisdictions in which it is authorized to do business. Each
Acquired Subsidiary is duly organized, validly existing, and in good standing under the Laws of its
jurisdiction of incorporation or formation, with full corporate or other power and authority to
own, operate and lease its properties and to carry on its respective Business as
22
currently conducted. Each Acquired Subsidiary is duly authorized to conduct business as a
foreign corporation or other foreign entity and is in good standing under the Laws of each state or
other jurisdiction in which the nature of property owned by it or the conduct of its Business
requires such qualification, except where the lack of such qualification would not reasonably be
expected to have a Material Adverse Effect. The Sellers have delivered to Buyers complete copies
of the Fundamental Documents in the possession of Sellers or the Acquired Subsidiaries as in effect
on the date hereof. Section 4.1(a) of the Disclosure Schedule contains a list of any original
Fundamental Documents not in the possession of the Sellers or the Acquired Subsidiaries.
(b) Officers and Directors. Section 4.1(b) of the Disclosure Schedule contains a
complete and accurate list of the officers and directors for each Acquired Subsidiary immediately
prior to Closing.
(c) Equity Interests of the Acquired Subsidiaries; Title to Securities; Etc.
(i) Section 4.1(c)(i) of the Disclosure Schedule sets forth, as of the date hereof, (i) the
equity capitalization and the authorized, issued, outstanding and treasury capital stock of the
Acquired Subsidiaries, (ii) the names of the respective owners of such shares of capital stock that
are being sold by the Sellers pursuant to this Agreement; and (ii) to the Sellers’ Knowledge, the
names of the owners, other than the Sellers, of the capital stock of Overseas Technical Services
Nigeria, Ltd. To the Sellers’ Knowledge, no Person other than those listed on Section 4.1(c)(i) of
the Disclosure Schedule has made any claim within the three-year period prior to the date of this
Agreement that it owns any shares of capital stock of Overseas Technical Services Nigeria, Ltd.
The Shares are held of record and beneficially by the Sellers free and clear of any Encumbrances.
All of the outstanding Shares have been duly authorized, validly issued and are fully paid and
non-assessable. No Acquired Subsidiary has issued or owns any bearer shares or uncertificated
shares of capital stock.
(ii) Except as set forth in Section 4.1(c)(ii) of the Disclosure Schedule, none of the
Acquired Subsidiaries have any outstanding or authorized options, warrants, purchase rights,
subscription rights, conversion rights, exchange rights, preemptive rights or other Contracts or
commitments that require any Acquired Subsidiary to issue, sell, or otherwise cause to become
outstanding any of its capital stock or other equity interests or equity securities convertible or
exchangeable therefor, or any options, warrants, or rights to purchase, any of such capital stock
or other equity interests. Except as set forth in Section 4.1(c)(ii) of the Disclosure Schedule,
there are no outstanding or authorized stock appreciation, phantom stock, profit participation or
similar rights with respect to any Acquired Subsidiary. There are no outstanding obligations of
any Acquired Subsidiary to repurchase, redeem or otherwise acquire any of its capital stock or
other equity interests. There are no declared and unpaid dividends on any shares of capital stock
of any Acquired Subsidiary. Section 4.1(c)(ii) of the Disclosure Schedule identifies any
stockholders’ agreement or voting agreement relating to any class of capital stock or other equity
interests of any Acquired Subsidiary or any entity in which any Acquired Subsidiary has any equity
or debt interest, and Sellers have delivered true and complete copies of all such agreements to
Buyers.
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(iii) Except as set forth in Section 4.1(c)(iii) of the Disclosure Schedule, no Acquired
Subsidiary owns, or has any right to acquire, directly or indirectly, any equity securities or
other securities of any Person or any direct or indirect equity or ownership interest in any other
business. Except as set forth in Section 4.1(c)(iii) of the Disclosure Schedule, no Person has any
interest or right to acquire an interest in any Acquired Subsidiary other than the Sellers. Except
as set forth in Section 4.1(c)(iii) of the Disclosure Schedule, no Acquired Subsidiary is a
participant in any joint venture, partnership or similar arrangement.
4.2 Accounting; Financial and Business Matters.
(a) Financial Statements. Section 4.2(a) of the Disclosure Schedule attached hereto
contains true, correct and complete copies of the following financial statements (the
“Financial Statements”):
(i) the audited combined balance sheet of the Acquired Subsidiaries and Xxxxx OTS Inc.,
Overseas Technical Services (Middle East) and Venezuela DeMantenimiento o Operacioes VB O&M, C.A.,
which are not being acquired as Acquired Subsidiaries under this Agreement, as of December 31, 2008
and the related combined statements of income, shareholders deficit and cash flows of the Acquired
Subsidiaries and Xxxxx OTS Inc., Overseas Technical Services (Middle East) and Venezuela
DeMantenimiento o Operacioes VB O&M, C.A. for the year then ended;
(ii) the unaudited combined balance sheet of the Acquired Subsidiaries as of June 30, 2009 and
the related combined statements of income for the 6 month period then ended (the “Interim
Financial Statement”).
The Financial Statements (x) present fairly in all material respects the financial position of
the Acquired Subsidiaries as of the dates thereof and their results of operations for such periods,
(y) have been prepared in accordance with GAAP, consistently applied, throughout the periods
covered thereby, except as may be indicated in the notes to the Financial Statements (except that
the unaudited Financial Statements are not accompanied by notes or other textual disclosure
required by GAAP and subject to, in the case of the Interim Financial Statement, normal year end
adjustments, which shall not be material in amount), and (z) except as set forth on Section 4.2(a)
of the Disclosure Schedule, are in accordance with the books and records of the Acquired
Subsidiaries which have been regularly maintained by Sellers in a manner consistent with historical
practice.
(b) No Undisclosed Liabilities.
(i) Except as reflected or expressly and adequately reserved against in the Financial
Statements, no Acquired Subsidiary has any Liability and there is no basis for any present or
future litigation, charge, complaint, claim or demand against any of them giving rise to any
Liability, except (A) a Liability that has arisen after the date of the Interim Financial Statement
in the Ordinary Course of Business (none of which relates to any breach of Contract, breach of
warranty, tort, infringement or violation of Law, or arose out of any Legal Action), (B)
Liabilities set forth in Section 4.2(b) of the Disclosure Schedule, or (C) any Liabilities arising
in connection with this Agreement, the Ancillary Agreements, or the Contemplated Transactions.
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(ii) Off-Balance Sheet Liabilities. No Acquired Subsidiary is a party to, or has any
commitment to become a party to, any joint venture, off-balance sheet partnership or any similar
Contract or arrangement (including any Contract relating to any transaction or relationship between
or among any Acquired Subsidiary or any of its Subsidiaries, on the one hand, and any
unconsolidated Affiliate of any Acquired Subsidiaries or any of its Subsidiaries, including any
structured finance, special purpose or limited purpose entity or Person, on the other hand, or any
“off-balance sheet arrangements” (as defined in Item 303 of Regulation S-K of the United States
Securities and Exchange Commission)), where the result, purpose or effect of such Contract is to
avoid disclosure of any material transaction involving, or material liabilities of, any Acquired
Subsidiary or any of its Subsidiaries in the Financial Statements.
(c) Books and Record; Internal Controls. The books of account of each Acquired
Subsidiary are complete and correct in all material respects. Each Acquired Subsidiary maintains
books, records and accounts which, in reasonable detail, accurately and fairly reflect its
transactions, Assets and liabilities and maintains a system of internal accounting controls that
provides reasonable assurance that: (i) its transactions are executed in accordance with
management’s authorization; (ii) its transactions are recorded as necessary to permit the
preparation of financial statements in conformity with GAAP and to maintain accountability for its
Assets; (iii) access to its Assets are permitted only in accordance with management’s
authorization; (iv) the recorded values for the Assets of each Acquired Subsidiary are compared
with existing Assets at reasonable intervals and appropriate action is taken with respect to any
differences; and (v) no Acquired Subsidiary maintains off-the-books accounts or more than one set
of books, records or accounts. Except as set forth on Section 4.2(c) of the Disclosure Schedule,
the Acquired Subsidiaries have not received any written advice or notification from their
independent certified public accountants that they have used any improper accounting practice that
would have the effect of not reflecting or incorrectly reflecting their financial position in any
respect in the Financial Statements or their books and records. Except as set forth on Section
4.2(c) of the Disclosure Schedule, the minute books and stock or equity records of each Acquired
Subsidiary, all of which are in the possession of Sellers or the Acquired Subsidiaries have been
made available to Buyers, and are complete and correct in all material respects. At the Closing,
all such books and records will be in the possession of the Acquired Subsidiaries except, for the
avoidance of doubt, those minute books and stock records set forth on Section 4.2(c) of the
Disclosure Schedule.
(d) Accounts Receivable. All Accounts Receivable and Unbilled Accounts Receivable
shown on the Financial Statements or on the accounting records of the Acquired Subsidiaries
represent, and the Accounts Receivable and Unbilled Accounts Receivable outstanding on the Closing
Date will represent, valid obligations arising from sales actually made or services actually
performed in the Ordinary Course of Business in bona fide transactions and, except for the Storm
Cat Receivables and as set forth on Section 4.2(d) of the Disclosure Schedule, are not subject to
any defenses, counterclaims, or rights of setoff, other than those arising in the Ordinary Course
of Business and for which reasonably adequate reserves have been established, relating to the
amount or validity of such Accounts Receivable and Unbilled Accounts Receivable. The reserves for
uncollectible Accounts Receivable reflected on the Financial Statements were established, and the
reserves for uncollectible Accounts Receivable reflected in the accounting records of the Acquired
Subsidiaries on the Closing Date will be established, in accordance with GAAP, are consistent with
the Acquired Subsidiaries’ historical
25
methods and practices in establishing such reserves and are adequate. Subject to such
reserves, each of such Accounts Receivable and Unbilled Accounts Receivable either has been or will
be collected in full, without any setoff, within twenty-two (22) months after the day on which it
first becomes due and payable.
(e) Absence of Changes. Except as set forth on Section 4.2(e) of the Disclosure
Schedule, since December 31, 2008 none of the Acquired Subsidiaries has experienced any change
(including, without limitation, any change in the relationship between any Acquired Subsidiary and
any significant customer, supplier or other business relationship) in the Business, financial
position, or results of operations that has had or could reasonably be expected to have,
individually or in the aggregate, a Material Adverse Effect. Since December 31, 2008, the Business
of the Acquired Subsidiaries has been operated in the Ordinary Course of Business consistent with
past practice and, except as set forth on Section 4.2(e) of the Disclosure Schedule:
(i) there has been no material damage, destruction or loss (whether or not covered by
insurance) to the Assets of the Acquired Subsidiaries;
(ii) except in the Ordinary Course of Business, there has been no increase in compensation
payable or to become payable by the Acquired Subsidiaries to, or any other material change in
employment terms of, any of their respective directors, officers or employees or the making of any
bonus payment, loan or similar arrangement to or with any of them;
(iii) no Acquired Subsidiary has made any material change in any Tax or financial accounting
methods, principles, practices, periods or elections from those utilized in the preparation of the
most recently filed Tax Returns or the Financial Statements;
(iv) there has been no incurrence of, or increase in, Liabilities of any nature in excess of
$250,000 other than items incurred in the Ordinary Course of Business (or experience of any change
in the assumptions underlying or the methods of calculating) of any bad debt, contingency, or other
reserve;
(v) no Encumbrance has been imposed on any of the Assets, other than Permitted Encumbrances;
(vi) no Acquired Subsidiary has declared, set aside or paid any dividend on or made any other
distribution in respect of any of its equity securities, or directly or indirectly redeemed,
purchased or otherwise acquired any of its equity securities, and there has been no stock split,
combination, reclassification or other similar change in the outstanding capital or other equity
securities of any Acquired Subsidiary;
(vii) no Acquired Subsidiary, other than in the Ordinary Course of Business, has made any
payment or transfer of consideration of any kind to any of its Affiliates, other than payments
which have not exceeded $50,000 individually to each such Affiliate and $250,000 in the aggregate
for all such payments;
(viii) no Acquired Subsidiary has acquired by merging or consolidating with, or by purchasing
any material portion of the equity securities or assets of, or by any other manner,
26
any Person, any business or any corporation, partnership, association or other business
organization or division thereof;
(ix) there has been no material change, termination, amendment, modification or renewal to or
of any Material Contract and, to the Sellers’ Knowledge, no other party to a Material Contract
intends to take any such action;
(x) there has not been any material change in (i) the credit or payment policies of each
Acquired Subsidiary or (ii) the time or manner in which each Acquired Subsidiary extends discounts
or credit to customers;
(xi) each Acquired Subsidiary has continued to invest in capital expenditures, sales and
marketing in accordance with their respective annual budgets and past practices;
(xii) no Acquired Subsidiary has incurred or committed to incur any capital expenditure (or
series of related capital expenditures) involving more than $100,000 individually, or $250,000 in
the aggregate;
(xiii) no Acquired Subsidiary has sold, leased, licensed, pledged, transferred, assigned or
otherwise disposed of any of its Assets, tangible or intangible, for a purchase price in excess of
$250,000 in the aggregate, other than in the Ordinary Course of Business;
(xiv) no Acquired Subsidiary has entered into any Contract (or series of related Contracts
with any single customer) involving more than $1,000,000;
(xv) no Acquired Subsidiary has issued any note, bond or other debt security or created,
incurred, assumed or guaranteed any indebtedness (including advances on existing credit facilities)
or capital lease either involving more than $50,000 individually or $250,000 in the aggregate, or
made any loan or advance to the Sellers or any other Person;
(xvi) no Acquired Subsidiary has canceled, compromised, waived or released any right or claim
(or series of related rights or claims) involving more than $100,000, or otherwise settled any
pending or threatened Legal Action against it that would reasonably be expected to involve in
excess of $250,000 in aggregate payments, and there has been no Order issued against any Acquired
Subsidiary requiring any Acquired Subsidiary to take any action (or refrain from taking any
actions) other than the payment of money in an amount less than $100,000;
(xvii) no Acquired Subsidiary has sold, assigned, transferred or granted any license or
sublicense of any rights under or with respect to any of its Intellectual Property Rights;
(xviii) there has been no change made to or authorized in the Fundamental Documents of any
Acquired Subsidiary;
(xix) no Acquired Subsidiary has entered into any employment or collective bargaining
agreement, written or oral, or modified the terms of any such existing agreement;
27
(xx) no Acquired Subsidiary has adopted, amended, modified or terminated any Plan (or taken
any such action with respect to any Plan);
(xxi) no Acquired Subsidiary has discharged or satisfied any Encumbrance or paid any
Liability, in each case with a value in excess of $50,000 individually or $250,000 in the
aggregate, other than current Liabilities paid in the Ordinary Course of Business;
(xxii) no Acquired Subsidiary has disclosed to any Person other than Buyers and authorized
representatives of Buyers any proprietary confidential information, other than pursuant to a
confidentiality agreement prohibiting the use or further disclosure of such information, which
agreement is listed on Section 4.2(e) of the Disclosure Schedule and is in full force and effect;
(xxiii) no Acquired Subsidiary has settled any Tax claim or assessment relating to the
Business, or entered into any closing agreement, or surrendered any right to claim a Tax refund, or
consented to any extension or waiver of the limitation period applicable to any Tax claim or
assessment relating to the Business;
(xxiv) there has been no change in any current cash management or working capital practices
with respect to the Business, write down of the value of any Assets in excess of $50,000
individually or $250,000 in the aggregate, acceleration or write off any Accounts Receivable in
excess of $50,000 individually or $250,000 in the aggregate or delay or postponement in any
material respect of the payment of accounts payable or other Liabilities in excess of $50,000
individually or $250,000 in the aggregate;
(xxv) there has been no strike, work stoppage or slowdown involving any Acquired Subsidiary or
its employees;
(xxvi) no Acquired Subsidiary has adopted any plan of complete or partial liquidation,
dissolution, merger, consolidation, restructuring, recapitalization or other reorganization;
(xxvii) no Acquired Subsidiary or Seller has failed to keep in full force and effect any
Current Policies, or reduced the amount of any insurance coverage provided by the Current Policies;
and
(xxviii) other than this Agreement and the Ancillary Agreements, there has been no Contract,
understanding, agreement, commitment or authorization for any Acquired Subsidiary to take any of
the actions specified in subparagraphs (i) through (xxvii) of this Section 4.2(e).
4.3 Material Contracts.
(a) Material Contracts. Section 4.3(a) of the Disclosure Schedule identifies all of
the following Contracts to which one or more of the Acquired Subsidiaries is a party or by which
any of them or any of their Assets are bound as of the date hereof (collectively the “Material
Contracts”):
28
(i) any written Contract with any present or former employee or consultant or for the
employment of any person, including any consultant, other than those written Contracts containing
the Acquired Subsidiary’s standard terms and conditions of employment (which have been provided to
Buyers), and any Contract pursuant to which any of the Acquired Subsidiaries is or may become
obligated to make any severance, termination, bonus or relocation payment or any other payment
(other than payments in respect of salary, reimbursement of expenses, director and manager fees and
expenses and the Plans, in each case, in the Ordinary Course of Business) to any current or former
officer, director, manager, employee, agent, representative or consultant;
(ii) any Contract for the purchase of, or payment for, supplies or products, or for the
performance of services by a third party involving in any one case $500,000 or more;
(iii) any Contract to sell or supply products or to perform maintenance, services or similar
duties involving in any one case $1,000,000 or more;
(iv) any distribution, marketing, dealer, representative, or sales agency Contract;
(v) any note, debenture, bond, letter of credit agreement, loan agreement, or other Contract
for the borrowing or lending of money or agreement or arrangement for a line of credit or
guarantee, pledge, or undertaking of the indebtedness of any other person in excess of $500,000;
(vi) any Contract for any charitable or political contribution;
(vii) each Contract containing covenants that in any way purport to restrict the Business
activity of the Acquired Subsidiaries or limit the freedom of the Acquired Subsidiaries to engage
in any line of business or to compete with any third party or engage in business with any third
party;
(viii) any Contract or transaction with a Related Party;
(ix) each licensing agreement or other Contract with respect to any Owned Intellectual
Property Rights, including agreements with current or former employees, consultants, or independent
contractors regarding the appropriation or the non-disclosure of any of the Owned Intellectual
Property Rights;
(x) any material license to use any Third Party Intellectual Property Rights used in the
Business (other than Off-the-Shelf Software);
(xi) each joint venture, partnership, and other Contract (however named) involving a sharing
of profits, losses, costs, or Liabilities by any Acquired Subsidiary with any other third party;
(xii) the Real Property Leases and each lease, rental or occupancy agreement, license,
installment and conditional sale agreement, and other Contract affecting the ownership
29
of, leasing of, title to, use of, or any leasehold or other interest in, any real or personal
property involving payment of more than $50,000 per year;
(xiii) each Contract that was not entered into in the Ordinary Course of Business that
involves expenditures or receipts in excess of $50,000;
(xiv) each Contract with an annual value of $250,000 or more providing for payments to or by
any third party based on sales, purchases, or profits, other than direct payments for goods;
(xv) each power of attorney or agency agreement that is currently effective and outstanding;
(xvi) each Contract for capital expenditures with a value of $100,000 or more;
(xvii) each written warranty, guaranty, and or other similar undertaking with respect to
contractual performance extended by any Acquired Subsidiary other than in the Ordinary Course of
Business; and
(xviii) any Contract under which any Acquired Subsidiary may be liable for consequential
damages, punitive damages, indirect losses, loss of profits or revenues, or damages to xxxxx or
reservoirs or any similar damages.
(b) Validity of Material Contracts. The Sellers have made available to the Buyers a
correct and complete copy of each Material Contract (or a description if unwritten), as amended to
date. Each Material Contract is legally binding, in full force and effect, and enforceable by the
Acquired Subsidiaries in accordance with its terms, except to the extent that such enforceability
may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar Laws relating
to creditors rights generally and to general principles of equity. Except as set forth on Section
4.3(b) of the Disclosure Schedule, the applicable Acquired Subsidiary and, to the Knowledge of the
Sellers, each other party thereto, is not in material breach or default under, or repudiated any
provision of, any Material Contract, and to the Knowledge of the Sellers, no event has occurred or
condition or set of circumstances exists which, with or without notice or lapse of time or both,
would constitute a material breach or default under any Material Contract by any party thereto.
Except as set forth on Section 4.3(b) of the Disclosure Schedule, no Acquired Subsidiary has given
nor has any Acquired Subsidiary received from any other Person, any notice or other communication
regarding the existence of any breach of, or default under, any Material Contract.
4.4 Litigation.
(a) Section 4.4(a) of the Disclosure Schedule sets forth a true, correct and complete list of
all Legal Actions pending which have been filed and served on any Acquired Subsidiary or as to
which any Acquired Subsidiary has been given written notice or, to the Knowledge of the Sellers,
all Legal Actions threatened against (i) any Acquired Subsidiary, or (ii) any director, officer,
manager or employee of the Acquired Subsidiaries or other Person for whom the Acquired Subsidiaries
may be liable. No Acquired Subsidiary is subject to, or bound by, any outstanding Order that has
not been satisfied in full or otherwise discharged or has
30
received notice of any Legal Action against the Assets of any Acquired Subsidiary. Schedule
4.4(a) sets forth all Orders to which any Acquired Subsidiary has been subject in the past three
(3) years.
(b) Section 4.4(b) of the Disclosure Schedule sets forth a true, correct and complete list of
each Legal Action that, within the last three (3) years, resulted in payments in excess of $100,000
individually by any Acquired Subsidiary, or any of their respective officers or members of the
board of directors in their capacity as such (whether as a result of an Order, civil fine,
settlement or otherwise).
4.5 Real Property.
(a) The Acquired Subsidiaries do not own any real property.
(b) Section 4.5(b) of the Disclosure Schedule contains a list of all of the real property in
which any Acquired Subsidiary currently has a leasehold interest (each a “Leased Real
Property” and collectively the “Leased Real Properties”). Section 4.5(b) of the
Disclosure Schedule also lists each Contract, agreement or instrument pursuant to which any
applicable Acquired Subsidiary leases any Leased Real Property (each, a “Real Property
Lease”). The Acquired Subsidiaries have delivered or made available to Buyers complete and
accurate copies of each Real Property Lease. The Leased Real Properties constitute all of the real
property leased (whether or not occupied and including any leases assigned or leased premises
sublet for which any Acquired Subsidiary remains liable), used or occupied by any Acquired
Subsidiary.
(c) The Real Property Leases are in full force and effect, and the Acquired Subsidiaries hold
a valid and existing leasehold interest under each of the Real Property Leases. To the Sellers’
Knowledge, the Leased Real Property is subject to no ground lease, master lease, mortgage, deed of
trust or other Encumbrance, other than Permitted Encumbrances, or interest that would entitle the
holder thereof to interfere with or disturb use or enjoyment of the Leased Real Property or the
exercise by the lessee of its rights under such lease so long as the lessee is not in default under
such Real Property Lease.
4.6 Title and Condition and Sufficiency of Assets.
(a) Each Acquired Subsidiary has good and marketable title to, or a valid leasehold interest
in, the buildings, equipment, and other tangible assets and properties used by it, located on its
premises or reflected as being owned by it on the Financial Statements as of December 31, 2008
(except for those sold or otherwise disposed of in the Ordinary Course of Business since December
31, 2008) and to those acquired by the Acquired Subsidiaries after December 31, 2008 and not sold
or otherwise disposed of since their acquisition, free and clear of all Encumbrances, except for
Permitted Encumbrances and Encumbrances listed on Section 4.6(a) of the Disclosure Schedule.
(b) The buildings, improvements, building systems, machinery, equipment and other tangible
assets and properties used in the conduct of the Acquired Subsidiaries’ Business are in good
condition and repair, ordinary wear and tear excepted, and are usable in the Ordinary Course of
Business. Each such asset is suitable for the purposes for which it is used
31
and is proposed to be used, is free from known material defects, and has been maintained in
accordance with normal industry practices.
(c) The Assets are sufficient for the continued conduct of the Business after the Closing in
substantially the same manner as conducted prior to the Closing. Except as set forth on Section
4.6(c) of the Disclosure Schedule, no Related Party has any interest in any Asset of any Acquired
Subsidiary or provides any services to any Acquired Subsidiary.
4.7 Intellectual Property.
(a) Section 4.7(a)(i) of the Disclosure Schedule lists and provides a summary description of
all Owned Intellectual Property Rights that are Registered Intellectual Property Rights and all
other material Owned Intellectual Property Rights. Section 4.7(a)(ii) of the Disclosure Schedule
lists all Contracts relating to Licensed-In Intellectual Property Rights other than Software and
provides a summary description of the Intellectual Property Rights covered by such Contracts; to
the extent there is no written Contract covering a Licensed-In Intellectual Property Right, Section
4.7(a)(ii) of the Disclosure Schedule lists the licensor and provides a summary description of the
Intellectual Property Rights so licensed. Section 4.7(a)(iii) of the Disclosure Schedule lists all
Contracts relating to Licensed-In Intellectual Property Rights that are Software other than
Off-the-Shelf Software and provides a summary description of the Intellectual Property Rights
covered thereby; to the extent there is no written Contract covering any Software, Section
4.7(a)(iii) of the Disclosure Schedule lists the licensor and provides a summary description of the
Software so licensed. The Owned Intellectual Property Rights and the Licensed-In Intellectual
Property Rights constitute all Intellectual Property Rights used in the Business or that is in
Sellers’ reasonable business judgment necessary for the Business as conducted immediately prior to
the Closing.
(b) The Acquired Subsidiaries own all right, title and interest in the Owned Intellectual
Property Rights free and clear of all Encumbrances, except for Permitted Encumbrances and except as
listed on Section 4.7(b) of the Disclosure Schedule. The Acquired Subsidiaries are the official
and sole owner of record of all Registered Intellectual Property Rights. To Sellers’ Knowledge, no
Owned Intellectual Property Right has been infringed by any Person.
(c) Sellers and the Acquired Subsidiaries have taken reasonable precautions to protect the
secrecy, confidentiality and value of the trade secrets and all other proprietary information used
by the Acquired Subsidiaries. Each Acquired Subsidiary has an unqualified right to use all trade
secrets and other proprietary information currently used in its Business, subject to any Contract
relating to Licensed-In Intellectual Property Rights.
(d) Except as set forth on Section 4.7(d) of the Disclosure Schedule, all material Licensed-In
Intellectual Property will be fully available to one or more of the Acquired Subsidiaries after the
Closing, and to Sellers’ Knowledge no Acquired Subsidiary has any present expectation that any
material Licensed Intellectual Property will not be renewed.
(e) No Acquired Subsidiary has infringed, misappropriated or otherwise violated any
Third-Party Intellectual Property Right, and no Acquired Subsidiary has received
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any notice of any infringement, misappropriation or violation by any Acquired Subsidiary of
any Third-Party Intellectual Property Right. No infringement, misappropriation or violation of any
Third-Party Intellectual Property Right has occurred with respect to products or services sold by
the Acquired Subsidiaries..
(f) Each Acquired Subsidiary has the right to use the Software used in its Business as it is
being used, without any conflict with the rights of others. No Acquired Subsidiary is in material
breach of any license to, or license of, any Software. Except as set forth in Section 4.7(f) of
the Disclosure Schedule, each Acquired Subsidiary following the Closing will have sufficient rights
to all necessary Software to operate its Business as conducted immediately prior to the Closing.
4.8 Benefit Plans.
(a) Section 4.8(a) of the Disclosure Schedule lists each Plan adopted, maintained, or
contributed to by any Acquired Subsidiary or under which any Acquired Subsidiary has any liability
or is required to contribute. Section 4.8(a) of the Disclosure Schedule also lists each bonus,
incentive, sales commission or other variable compensation arrangement covering employees of any
Acquired Subsidiary, and identifies the employees eligible thereunder.
(b) Section 4.8(b) of the Disclosure Schedule lists each corporation, trade or business
(separately for each category below that applies): (i) that is (or was during the preceding five
years) under common control with any Acquired Subsidiary within the meaning of Section 414(b) or
(c) of the Code, (ii) that is (or was during the preceding five years) in an affiliated service
group with any Acquired Subsidiary within the meaning of Section 414(m) of the Code, (iii) that is
(or was during the preceding five years) the legal employer of Persons providing services to any
Acquired Subsidiary as leased employees within the meaning of Section 414(n) of the Code and (iv)
with respect to which any Acquired Subsidiary is a successor employer for purposes of group health
or other welfare plan continuation rights (including Section 601 et seq. of ERISA) or the Family
and Medical Leave Act.
(c) Sellers have provided or made available to Buyers current, accurate and complete copies of
(i) the most recent determination letter received by any Acquired Subsidiary from the IRS regarding
each Plan, (ii) the most recent determination or opinion letter ruling from the IRS that each trust
established in connection with Plans that are intended to be tax exempt under Section 501(a) or (c)
of the Code are so tax exempt, (iii) all pending applications for rulings, determinations,
opinions, no action letters and the like filed with any governmental agency (including the
Department of Labor, IRS, Pension Benefit Guaranty Corporation and the SEC), (iv) the financial
statements for each Plan for the three most recent fiscal or plan years (in audited form if
required by ERISA) and, where applicable, Annual Report/Return (Form 5500) with disclosure
schedules, if any, and attachments for each Plan, (v) plan documents, trust agreements, insurance
contracts, service agreements and all related contracts and documents (including any employee
summaries and material employee communications) with respect to each Plan, (vi) collective
bargaining agreements (including side agreements and letter agreements) relating to the
establishment, maintenance, funding and operation of any Plan, and (vii) attorney’s response to
auditors’ requests for information.
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(d) (i) All Plans intended to be federal income Tax qualified under Section 401(a) or Section
403(a) of the Code are so qualified, (ii) all trusts established in connection with Plans intended
to be federal income Tax exempt under Section 501(a) or (c) of the Code are so exempt, (iii) to the
extent required either as a matter of Law or to obtain the intended federal income Tax treatment
and federal income Tax benefits, all Plans comply, in all material respects, with the requirements
of ERISA and the Code and other applicable Laws, (iv) all Plans have been administered in
compliance, in all material respects, with the documents and instruments governing the Plans and
other applicable Laws, (v) all reports and filings with Governmental Authorities (including the
Department of Labor, the IRS, Pension Benefit Guaranty Corporation and the SEC) required in
connection with each Plan have been timely made, (vi) all disclosures and notices required by Law
or Plan provisions to be given to participants and beneficiaries in connection with each Plan have
been properly and timely made, and (vii) each Acquired Subsidiary has complied, in all material
respects, with the reporting and taxation requirements for FICA taxes with respect to any deferred
compensation arrangements under Section 3121(v) of the Code.
(e) (i) All contributions, premium payments and other payments required to be made through the
Closing Date in connection with the Plans have been timely made (as limited for claims made in the
case of payments made under self-insured plans), (ii) a proper accrual has been made on the books
of account of each Acquired Subsidiary for all contributions, premium payments and other payments
due in the current fiscal year, (iii) no contribution, premium payment or other payment has been
made in support of any Plan that is in excess of the allowable deduction for federal income Tax
purposes under Section 404, Section 419 or Section 419A of the Code, and (iv) with respect to each
Plan that is subject to Section 301 et seq. of ERISA or Section 412 of the Code, no Acquired
Subsidiary is liable for any “accumulated funding deficiency” as that term is defined in Section
412 of the Code and the projected benefit obligations do not exceed the assets of the Plan.
(f) Except as provided in Section 4.8(f) of the Disclosure Schedule, the consummation of the
Contemplated Transactions will not by themselves or in combination with any other event (without
regard to whether such event has or may occur) (i) cause any Plan to increase benefits payable to
any participant or beneficiary, (ii) entitle any current or former employee or other service
provider of any Acquired Subsidiary to severance pay, unemployment compensation or any other
payment, benefit or award or (iii) accelerate or modify the time of payment or vesting, or increase
the amount of any benefit, award or compensation due any such employee or service provider.
(g) Except as provided in Section 4.8(g) of the Disclosure Schedule, (i) No Legal Action is
pending or threatened to a Plan official with regard to any Plan other than routine uncontested
claims for benefits, (ii) no Plan is currently under examination or audit by the Department of
Labor, the IRS or the Pension Benefit Guaranty Corporation, (iii) no Acquired Subsidiary has any
actual, or to the Sellers’ Knowledge, potential liability arising under Title IV of ERISA as a
result of any Plan that has terminated or is in the process of terminating, (iv) no Acquired
Subsidiary has any actual, or to the Sellers’ Knowledge, potential liability under Section 4201 et
seq. of ERISA for either a complete withdrawal or a partial withdrawal from a multiemployer plan,
(v) with respect to the Plans, no Acquired Subsidiary has any liability (either directly or as a
result of indemnification) for (and the Contemplated Transactions will not
34
cause any liability for): (A) any excise Taxes under Section 4971 through Section 4980B,
Section 4999, Section 5000 or any other Section of the Code, (B) any penalty under Section 502(i),
Section 502(l), Part 6 of Title I or any other provision of ERISA, or (C) any excise Taxes,
penalties, damages or equitable relief as a result of any prohibited transaction, breach of
fiduciary duty or other violation under ERISA or any other applicable Law, (vi) all accruals
required under FAS 106 and FAS 112 have been properly accrued on the Financial Statements, (vii) no
condition, agreement or Plan provision limits the right of any Acquired Subsidiary to amend, cut
back or terminate any Plan (except to the extent such limitation arises under ERISA or the Code),
and (viii) no Acquired Subsidiary has any liability for life insurance, death or medical benefits
after the end of the month in which separation from employment occurs, including any such coverage
for retirees, other than (A) death benefits under the Plans, (B) health care continuation benefits
described in Section 4980B of the Code, or (C) except as may be specifically provided in this
Agreement.
(i) No Acquired Subsidiary, nor any Person treated or previously treated as a single employer
with any Acquired Subsidiary under Section 414 of the Code, has ever contributed to or had any
other liability under or with respect to any (i) Plan subject to the funding requirements of
Section 303 of ERISA, Section 412 of the Code or Title IV of ERISA; (ii) “multiple employer welfare
arrangement” as defined in Section 3(40)(A) of ERISA or “multiple employer plan” as described in
Section 413(c) of the Code; or (iii) multiemployer plan as defined in Section 3(37) of ERISA. No
Acquired Subsidiary has liability, nor has taken any action that could give rise to such liability,
including under any Plan, arising out of the treatment of any service provider as a consultant or
independent contractor and not as an employee.
4.9 Related Party Transactions.
Listed on Section 4.9 of the Disclosure Schedule are all transactions, Contracts, agreements
or arrangements between any Acquired Subsidiary and any Related Party, with such disclosure
detailing, in the case of each loan or extension of credit, the outstanding principal amount, the
interest rate and final maturity date, and in the case of any other Contract or transaction, the
nature and terms thereof and any amounts paid and/or payable in connection therewith.
4.10 Non-contravention; Consents.
(a) Except as listed on Section 4.10(a) of the Disclosure Schedule, neither the execution and
delivery of any Transaction Document by the Acquired Subsidiaries nor the performance by the
Acquired Subsidiaries of their obligations hereunder or thereunder will (i) violate any of the
provisions of the Acquired Subsidiaries’ Fundamental Documents; (ii) violate any Law or Order
applicable to any Acquired Subsidiary, (iii) conflict with, result in a breach of, constitute a
default (or any event which, with or without due notice or lapse of time, or both, would constitute
a violation or default) under, result in the acceleration of, create in any party the right to
accelerate, terminate, modify, or cancel, or require any notice under any Material Contract to
which any Acquired Subsidiary is a party or by which it is bound or to which any of its Assets is
subject, or (iv) result in the imposition or creation of an Encumbrance upon or with respect to the
Shares.
35
(b) Except as listed on Section 4.10(b) of the Disclosure Schedule, no consent, authorization
or approval or other action by, and no notice to or declaration, filing or registration with, any
Governmental Authority will be required to be obtained or made by the Sellers or the Acquired
Subsidiaries in connection with the due execution and delivery by Sellers of this Agreement or the
performance or consummation by the Sellers of the Contemplated Transactions.
4.11 Insurance.
(a) Details of Insurance Experience. Section 4.11(a) of the Disclosure Schedule sets
out, by year, for the current policy year (collectively, the “Current Policies”) and each
of the three (3) preceding policy years:
(i) a description (including the name of the policy, the insurer, the policyholder, and each
covered insured, the policy number, and the period of coverage) of each insurance policy (including
policies providing property, casualty, liability, and workers’ compensation coverage and bond and
surety arrangements) with respect to which an Acquired Subsidiary, or any director or officer
thereof, is a party, a named insured, or otherwise the beneficiary of coverage;
(ii) a summary of the loss experience under each such policy; and
(iii) a statement describing each claim under an insurance policy for an amount in excess of
$250,000 which sets forth (A) a description of the policy (including name of the policy, the
insurer, type of insurance, policy number, and period of coverage); and (B) the amount and a brief
description of the claim and the name of the claimant.
(b) Deliveries to Buyers. Sellers have delivered to Buyers (i) true and complete
copies of all policies of insurance listed, or required to be listed, on Section 4.11(a) of the
Disclosure Schedule in Sellers’ possession and, in the case of policies not in Sellers’ possession,
a binder or other proof of coverage for such policies; and (ii) true and complete copies of all
pending applications as of the date of this Agreement for policies of insurance with respect to
which an Acquired Subsidiary is to be a party, a named insured, or otherwise the beneficiary of
coverage.
(c) Validity of Policies. All Current Policies:
(i) are valid, outstanding, and enforceable;
(ii) taken together, in Sellers’ reasonable business judgment provide adequate insurance
coverage for the Assets and the operations of the Acquired Subsidiary;
(iii) are sufficient for compliance with all (a) Contracts to which the Acquired Subsidiary is
a party or by which any of them is bound, and (b) Laws; and
(iv) except as set forth on Section 4.11(c)(iv) of the Disclosure Schedule, do not provide for
any retrospective premium adjustment or other experienced-based liability on the part of the
Sellers or the Acquired Subsidiaries.
36
(d) No Notices. With respect to the Current Policies, neither the Sellers and nor any
Acquired Subsidiary has received (i) any denial of coverage, or (ii) any notice of cancellation or
any other indication that any insurance policy is no longer in full force or effect or will not be
renewed except for a notice of non-renewal received in the ordinary course of business in
anticipation of policy renewal or that the issuer of any policy is not willing or able to perform
its obligations thereunder.
(e) Compliance by the Sellers and Acquired Subsidiaries. Neither the Acquired
Subsidiaries nor, to the Sellers’ Knowledge, any other party to any Current Policy is in breach or
default (including with respect to the payment of premiums or the giving of notices), and no event
has occurred which, with notice or the lapse of time, would constitute such a breach or default, or
permit termination, modification, or acceleration, under any Current Policy.
(f) Notices of Claims. The Sellers or the Acquired Subsidiaries have given proper
notice to the insurer of all known claims that may be insured thereby.
(g) Adequate Coverage. The Current Policies will provide coverage in accordance with
their terms, conditions, endorsements and exclusions for any and all Liabilities of the Acquired
Subsidiaries that are included in the coverage provided under the Current Policies and based upon
or arising from an event, occurrence, action or inaction occurring, or losses or damages incurred,
prior to the Effective Time. Any Liabilities of the Acquired Subsidiaries included in such
coverage do not exceed the amount of the insurance proceeds recoverable by the Acquired
Subsidiaries under the Current Policies plus the reserve for such Liabilities included on the
balance sheet in the Interim Financial Statement as adjusted for the passage of time through the
Closing Date in accordance with past customs and practices of the Acquired Subsidiaries.
4.12 Taxes.
(a) Except as set forth on Section 4.12(a) of the Disclosure Schedule, each Acquired
Subsidiary has timely filed all material Tax Returns that it was required to file under applicable
Laws, either separately or as a member of a group of corporations, and all such Tax Returns are
true, correct and complete in all material respects. All such Tax Returns as so filed disclose all
material Taxes required to be paid for the periods covered thereby. All material Taxes due and
owing by each Acquired Subsidiary (whether or not shown on any Tax Return) have been paid. Except
as set forth on Section 4.12(a) of the Disclosure Schedule, no Acquired Subsidiary currently is the
beneficiary of any extension of time within which to file any Tax Return. There are no liens for
Taxes (other than Taxes not yet due and payable) upon any of the Assets. Except as set forth on
Section 4.12(a) of the Disclosure Schedule, each Acquired Subsidiary has withheld and paid all
material Taxes required to have been withheld and paid in connection with amounts paid or owing to
any employee, independent contractor, creditor, stockholder, foreign Persons or other third party,
and all IRS Forms W-2, 1099 and all foreign material Tax reporting forms required with respect
thereto have been properly completed and timely filed.
(b) No federal, state, local, or non-U.S. Tax audits or administrative or judicial Tax
proceedings or any other Legal Action are pending or being conducted with respect
37
to any Acquired Subsidiaries. Except as set forth on Section 4.12(b) of the Disclosure
Schedule, no Acquired Subsidiary has received from any federal, state, local, or non-U.S. taxing
authority (including jurisdictions where an Acquired Subsidiary has not filed Tax Returns) any (i)
notice indicating an intent to open an audit or other review, (ii) request for information related
to Tax matters, or (iii) notice of deficiency or proposed adjustment for any amount of Tax
proposed, asserted, or assessed by any taxing authority against any Acquired Subsidiary. Except as
set forth on Section 4.12(b) of the Disclosure Schedule, there is no deficiency, adjustment,
dispute or claim concerning any Tax liability of any Acquired Subsidiary either (A) claimed or
raised by any Tax authority, or (B) as to which any of the Sellers have Knowledge.
(c) Section 4.12(c) of the Disclosure Schedule lists all material federal, state, local, and
foreign Tax Returns filed with respect to the Acquired Subsidiaries for taxable periods ended on or
after December 31, 2008, indicates those Tax Returns that have been audited, and indicates those
Tax Returns that currently are the subject of audit. Sellers have delivered to Buyers correct and
complete copies of all material Tax Returns, examination reports, and statements of deficiencies
assessed against, or agreed to by each Acquired Subsidiary for taxable periods ended on or after
December 31, 2008.
(d) No Acquired Subsidiary has waived any statute of limitations in respect of Taxes or agreed
to any extension of time with respect to a Tax assessment or deficiency.
(e) No Acquired Subsidiary is a party to any agreement, Contract, arrangement, or plan that
has resulted or would result, separately or in the aggregate, in the payment of any “excess
parachute payment” within the meaning of Code Section 280G (or any corresponding provision of
state, local, or foreign Tax Law) and any amount that will not be fully deductible as a result of
Code Section 162(m) (or any corresponding provision of state, local, or foreign Tax law). No
Acquired Subsidiary is now or has been a United States real property holding corporation within the
meaning of Code Section 897(c)(2) during the applicable period specified in Code Section
897(c)(1)(A)(ii). No Acquired Subsidiary has engaged in a transaction that the IRS has identified
by regulation or other form of published guidance as a listed transaction, as set forth in Treasury
Regulation Section 1.6011-4(b)(2).
(f) No Acquired Subsidiary is a party to or bound by any Tax allocation, Tax sharing or
similar agreement that will survive the Closing. No Acquired Subsidiary has been a member of an
Affiliated Group filing a consolidated federal income Tax Return other than a group the common
parent of which is Xxxxx. Xxxxx has filed a consolidated federal income Tax Return with Xxxxxxx
Xxxxx Global, Inc. and Xxxxx/MO Services, Inc. for the taxable year immediately preceding the
current taxable year.
(g) Section 4.12(g) of the Disclosure Schedule sets forth the following information with
respect to each of the Acquired Subsidiaries as of the most recent practicable date: (A) the amount
of any net operating loss, net capital loss, unused investment or other credit, unused foreign tax
credit, or excess charitable contribution allocable to the Acquired Subsidiary; and (B) the amount
of any deferred gain or loss allocable to the Acquired Subsidiary arising out of any inter-company
transaction.
38
(h) The unpaid Taxes of the Acquired Subsidiaries (A) did not, as of the date of the Interim
Financial Statements, exceed the aggregate reserves for Tax Liability (rather than any reserve for
deferred Taxes established to reflect timing differences between book and Tax income) set forth on
the balance sheet contained in the Interim Financial Statements, and (B) will not, as of the
Closing Date, exceed that reserve as adjusted for operations and transactions through the Closing
Date in accordance with the past custom and practice of the Acquired Subsidiaries in filing their
Tax Returns. Since the date of the balance sheet contained in the Interim Financial Statements, no
Acquired Subsidiary has incurred any Liability for Taxes arising from extraordinary gains or
losses, as that term is used in GAAP, outside the Ordinary Course of Business consistent with past
custom and practice.
(i) No Acquired Subsidiary will be required to include any item of income in, or exclude any
item of deduction from, taxable income for any taxable period (or portion thereof) ending after the
Closing Date as a result of any:
(A) change in method of accounting for a taxable period ending on or prior to the
Closing Date;
(B) “closing agreement” as described in Code Section 7121 (or any corresponding or
similar provision of state, local or foreign income Tax Law) executed on or prior to the
Closing Date;
(C) inter-company transactions or any excess loss account described in Treasury
Regulations under Code Section 1502 (or any corresponding or similar provision of state,
local or foreign income Tax Law);
(D) installment sale or open transaction disposition made on or prior to the Closing
Date; or
(E) prepaid amount received on or prior to the Closing Date.
(j) No Acquired Subsidiary has distributed stock of another Person, or has had its stock
distributed by another Person, in a transaction that was purported or intended to be governed in
whole or in part by Section 355 of the Code.
(k) All material sales, use or value added Taxes that are required or permitted have been
withheld or collected by each Acquired Subsidiary have been duly withheld and collected and, to the
extent required, have been properly paid or deposited as required by applicable Laws. Any
applicable exemption for sales, use or value added Taxes has been properly claimed by delivering or
receiving to or from the proper party a properly completed and executed exemption certificate.
(l) None of the Acquired Subsidiaries has executed or entered into a closing agreement
pursuant to Section 7121 of the Code or any predecessor provision thereof or any similar provision
of state, local or foreign law that could have a continuing effect with respect to any taxable
period or portion thereof beginning on or after the Closing Date.
39
(m) None of the Acquired Subsidiaries has filed, or have pending, any ruling requests with any
Tax authority, including any request to change any accounting method.
(n) Except as set forth on Section 4.12(n) of the Disclosure Schedule, each Acquired
Subsidiary (to the extent required by Law) has preserved and retained in its possession complete
and accurate records relating to its Tax affairs (including, without limitation, payroll and
value-added tax records and records relating to transfer pricing) and has sufficient records
relating to past events to calculate for Tax purposes the gain or loss that would arise on the
disposal or realization of any Asset owned by it at the date of this Agreement or acquired by it
after that date but on or prior to Closing.
(o) None of the Assets of any Acquired Subsidiary directly or indirectly secures any debt the
interest on which is tax exempt under Section 103(a) of the Code. None of the property owned or
used by any Acquired Subsidiary is subject to a tax benefit transfer lease executed in accordance
with Section 168(f)(8) of the Internal Revenue Code of 1954, as amended. None of the property
owned by any Acquired Subsidiary is “tax-exempt use property” within the meaning of Section 168(h)
of the Code.
(p) Each such Plan and Contract of the Acquired Subsidiaries that provides for nonqualified
deferred compensation has, since January 1, 2005, been operated and maintained materially in
accordance with a good faith, reasonable interpretation of Code Section 409A, as determined under
applicable guidance of the Department of Treasury and IRS, as was in effect from time to time, with
respect to amounts deferred (within the meaning of Code Section 409A) after January 1, 2005.
(q) Each Affiliated Group has filed all material Tax Returns that it was required to file for
each taxable period during which any Acquired Subsidiary was a member of the group. All such Tax
Returns were correct and complete in all material respects. All material Taxes owed by any
Affiliated Group (whether or not shown on any Tax Return) have been paid for each taxable period
during which any Acquired Subsidiary was a member of the group.
(r) There is no dispute or claim concerning any Tax Liability of any Affiliated Group for any
taxable period during which any of the Acquired Subsidiaries was a member of the group either (A)
claimed or raised by any Government Authority in writing, or (B) as to which any Seller and the
directors and officers (and employees responsible for Tax matters) of any of Xxxxx and its
Subsidiaries has knowledge. No Affiliated Group has waived any statute of limitations in respect
of any Taxes or agreed to any extension of time with respect to a Tax assessment or deficiency for
any taxable period during which any of the Acquired Subsidiaries was a member of the group.
(s) Except as set forth on Section 4.12(s) of the Disclosure Schedule, no Acquired Subsidiary
has any liability for the Taxes of any Person (other than an Acquired Subsidiary) (A) under
Treasury Regulation Section 1.1502-6 (or any similar provision of state, local, or foreign Law),
(B) as a transferee or successor, (C) by Contract, or (D) otherwise.
40
(t) No Acquired Subsidiary has undergone an ownership change that limits the use of its net
operating losses or other carryovers that would otherwise be available after the Closing.
4.13 Legal Compliance.
(a) Compliance with Laws. Except as set forth on Section 4.13(a) of the Disclosure
Schedule, each Acquired Subsidiary (and each director, officer, and employee, and each
representative and agent of any of the foregoing, in their respective capacity as such) (i) has,
within the past five years, complied with each Law that is or was applicable to the Business or the
ownership of the Assets of such Acquired Subsidiary, and (ii) is not in violation of any applicable
Law. No Acquired Subsidiary is relying on any exemption from or deferral of any Law, Order or
Government Authorization that would not be available to Buyers after the Closing. Within the five
year period preceding the date of this Agreement, no Acquired Subsidiary has received any notice or
other communication from any Governmental Authority alleging its actual or potential violation of
any applicable Law. Sellers and each Acquired Subsidiary is in material compliance with, in
accordance with a good faith, reasonable interpretation of, all registration and reporting
requirements for all Claims pursuant to the Medicare, Medicaid SCHIP Extension Xxx 0000, Section
111.
(b) Government Authorizations. The Acquired Subsidiaries hold all Government
Authorizations that are necessary to permit the Acquired Subsidiaries to lawfully conduct and
operate their Business in the manner they currently conduct and operate such Business and to permit
the Acquired Subsidiaries to own and use their Assets in the manner in which they currently own and
use such Assets. Section 4.13(b) of the Disclosure Schedule lists each Government Authorization
held by the Acquired Subsidiaries. All such Government Authorizations are in full force and
effect. Each Acquired Subsidiary has complied with all Government Authorizations identified on
Section 4.13(b) of the Disclosure Schedule. No Acquired Subsidiary has received notice of (i) any
pending proceedings which could reasonably be expected to result in the revocation, cancellation,
suspension or any modification of any such Government Authorizations, or (ii) any default under any
of such Government Authorizations.
(c) Foreign Corrupt Practices Act.
(i) None of the Acquired Subsidiaries (nor any of their respective Affiliates), nor their
directors, officers, or employees, or any representatives or agents of any of the foregoing, in
their respective capacity as such, have directly or indirectly offered, promised, authorized or
made any payment or given anything of value to any Governmental Authority official, political
party, party official or candidate, or any employee, agent or representative thereof (or to any
Person, with the knowledge that all or part of the payment would be, or is reasonably likely to be
shared with a Governmental Authority official, political party, party official or candidate, or any
employee, agent or representative thereof) for the purpose of securing any improper advantage in
connection with any business of the Acquired Subsidiaries, this Agreement or the Contemplated
Transactions, or consents required in connection with this Agreement and/or the Contemplated
Transactions or otherwise in violation of any applicable Law, including the Foreign Corrupt
Practices Act of 1977, as amended (“FCPA”).
41
(ii) No director, officer, employee, agent or representative of any Acquired Subsidiary is (i)
a Governmental Authority official, political party official or candidate, or an employee, agent or
representative of any of the foregoing, (ii) or a director, shareholder, officer, or employee of
any enterprise that is controlled (whether by majority stock ownership or otherwise) by any
Governmental Authority where such position would violate any applicable Laws.
(iii) Regardless of whether such action may constitute a violation of FCPA or any other Law,
no director, officer, employee, agent or representative of any Acquired Subsidiary has (A) made,
offered or agreed to offer anything of value to any supplier or customer of an Acquired Subsidiary
for the purpose of obtaining or securing any improper advantage in connection with obtaining or
retaining business for an Acquired Subsidiary, or (B) received or expected to receive anything of
value from any third party in connection with any transaction entered into by an Acquired
Subsidiary or such director, officer, employee, agent or representative (other than salary, wages,
other ordinary compensation or other payments paid to such director, officer, employee, agent or
representative in accordance with applicable Law).
(iv) Each Seller has fully and accurately disclosed the nature and scope of all inquiries by
Governmental Authorities with respect to the Acquired Subsidiaries’ past (A) use of any corporate
or other funds for unlawful contributions, gifts, entertainment or other unlawful expenses relating
to political activity, (B) unlawful payment or acquiescence to payment by a third party to foreign
or domestic government officials or employees or to foreign or domestic political parties or
campaigns or otherwise violated any provision of the FCPA or (C) any other unlawful payment,
contribution, expenditure or gift (including acquiescence to any unlawful payment contribution,
expenditure or gift made by a third party). There are no current inquiries by Governmental
Authorities, other than those disclosed in Section 4.13(c)(iv) of the Disclosure Schedule,
regarding any of the foregoing activities or any other fraudulent or corrupt activity involving the
Acquired Subsidiaries or Assets of the Acquired Subsidiaries.
(d) International Trade Laws. Each Acquired Subsidiary has at all times during the
five years preceding the date of this Agreement complied with all applicable import and export
control and trade embargo Laws and for the five year period preceding the date hereof has complied
with all applicable import and export control and trade embargo Laws in connection with any actual
or proposed transaction, including all applicable Customs and International Trade Laws. No
Acquired Subsidiary is subject to any civil or criminal investigation, litigation, audit,
compliance assessment, focused assessment, penalty proceeding or assessment, liquidated damages
proceeding or claim, forfeiture or forfeiture action, assessment of additional duty for failure to
properly xxxx imported merchandise, notice to properly xxxx merchandise or return merchandise to
customs custody, claim for additional customs duties or fees, denial order, suspension of export
privileges, government sanction, or any other Legal Action by or Order of a Governmental Authority
involving or otherwise relating to any alleged or actual violation of the Customs and International
Trade Laws or relating to any alleged or actual underpayment of customs duties, fees, taxes or
other amounts owed pursuant to the Customs and International Trade Laws, and each Acquired
Subsidiary has paid all material customs duties and fees and brokerage fees owed for merchandise
imported by them or imported on their behalf into the United States. No Acquired Subsidiary has
conducted business in, or
42
with any Person in, any of the following countries: Burma (Myanmar), Cuba, Iran, North Korea,
Sudan, Syria or Zimbabwe.
4.14 Environmental, Health, and Safety.
(a) The Sellers have made available to Buyers copies of all environmental site assessments,
reports and studies conducted by or on behalf of any Acquired Subsidiary with respect to its Leased
Real Property that have been prepared during the past three years, or that are otherwise in any
Acquired Subsidiary’s possession. Section 4.14(a) of the Disclosure Schedule contains a listing of
such environmental assessments, reports and studies.
(b) For purposes of this Agreement:
(i) “Environmental, Health and Safety Requirements” shall mean all existing federal,
state, local and foreign statutes, regulations, rules, codes, (Laws (including without limitation
common law) and reporting or licensing requirements concerning pollution or protection of the
environment (including ambient outdoor and indoor air, surface water, ground water, land surface or
subsurface strata) or workplaces health or safety, including without limitation: (i) the
Comprehensive Environmental Response Compensation and Liability Act, (42 U.S.C. §§9601 et seq.)
(“CERCLA”); (ii) the Solid Waste Disposal Act, as amended by the Resource Conservation and
Recovery Act, as amended, (42 U.S.C. §§6901 et seq.), (“RCRA”); (iii) the Emergency
Planning and Community Right to Know Act (42 U.S.C. §§11001 et seq.); (iv) the Clean Air Act (42
U.S.C. §§ 7401 et seq.); and (v) the Clean Water Act (33 U.S.C. §§1251 et seq.). Environmental,
Health and Safety Requirement shall also include any regulation, code, plan, order, decree,
judgment, notice or demand issued, entered by, promulgated or approved by any Environmental, Health
and Safety Requirement.
(ii) “Hazardous Materials” means any chemical, waste, by—product, pollutant,
contaminant, compound, product, substance, equipment or fixture defined as or deemed to be
hazardous or toxic under any applicable Environmental, Health and Safety Requirement in effect as
of the Closing Date.
(iii) “Release” shall have the same meaning ascribed thereto hereunder as under CERCLA
Section 101(22) except that it shall apply to all Hazardous Materials, not just CERCLA hazardous
substances.
(c) Except as set forth on Section 4.14(c) of the Disclosure Schedule, each Acquired
Subsidiary:
(i) is in compliance with all Environmental, Health and Safety Requirements, the
non-compliance with which would likely result in a Material Adverse Effect;
(ii) has not received any written notice regarding any actual or alleged material violation of
any Environmental, Health and Safety Requirements or any liabilities or potential liabilities
(whether accrued, absolute, contingent, unliquidated or otherwise), including any investigatory,
remedial or corrective obligations, relating to any Acquired Subsidiary or any of their respective
facilities arising under any Environmental, Health and Safety Requirement. No Acquired Subsidiary
has been notified in writing that it is potentially liable under or received
43
any written requests for information or other correspondence concerning any site or facility
under CERCLA or any similar Law;
(iii) has accurately prepared and timely filed with the appropriate jurisdictions all reports
and filings required pursuant to any Environmental, Health and Safety Requirements applicable to or
affecting any Acquired Subsidiary or its Business;
(iv) has not entered into or received, nor is any Acquired Subsidiary in default under, any
consent decree, compliance order, administrative order, judgment, order, writ or injunction of any
Governmental Authority relating to Environmental, Health and Safety Requirements; and
(v) has obtained all material permits, licenses, approvals, consents, orders and
authorizations that are required under Environmental, Health and Safety Requirements
(“Environmental Permits”) for conducting the operations of any Acquired Subsidiary as
currently being conducted or the ownership of the Assets and properties owned or used by any
Acquired Subsidiary, and Section 4.14(c)(v) of the Disclosure Schedule contains a list of each such
Environmental Permit. Except where non-compliance would not have a Material Adverse Effect, each
Acquired Subsidiary is in compliance in all respects with each Environmental Permit, and no
Environmental Permit materially restricts any Acquired Subsidiary from operating any equipment
covered by such Environmental Permit in the manner operated in the Business of such Acquired
Subsidiary.
(d) With respect to each Acquired Subsidiary:
(i) There are no actions, suits, claims, arbitration proceedings, or complaints pending or, to
the Sellers’ Knowledge, threatened by any Person or Governmental Authority relating to compliance
with Environmental, Health and Safety Requirements, or the condition of the Leased Real Properties,
or, to the Sellers’ Knowledge, any of their predecessors or current or former subsidiaries; and
(ii) to the Sellers’ Knowledge, except as set forth on Section 4.14(d)(ii) of the Disclosure
Schedule, there has been no disposal, spillage, burial, placement or other Release of Hazardous
Materials by any Acquired Subsidiary, or any of their predecessors or current or former
subsidiaries, or by any other party on, in, at, about, or from any of the Leased Real Properties.
4.15 Employees.
(a) Buyers will be provided with an electronic data file listing, as of the date of this
Agreement for United States employees and as of the following dates for the following non-U.S.
employees: OTS International Training Services, Ltd. (September 23, 2009); Overseas Technical
Services (Harrow) Limited (September 23, 2009); and BES Energy Resources Co., Ltd (September 22,
2009) (the “Electronic Data File”), the names of all employees in each Acquired Subsidiary,
each such employee’s annual salary, any other compensation payable (including compensation payable
pursuant to bonus, incentive, deferred compensation or commission arrangements, excepting
compensation required by non-U.S. laws), date of employment, hourly or salaried status, job
position, any visa or work permit status, whether the
44
employee is on an active or inactive status, vacation or other leave entitlement vested but
unused, classification as exempt or non-exempt (for U.S. employees only) and as full-time,
part-time or temporary (for U.S. employees only), and if the employee is now absent from active
employment, the basis of such leave. Promptly following the Closing, but in any event no later
than fifteen (15) days following the Closing Date, Sellers shall provide to Buyers an updated
version of the Electronic Data File reflecting the information required under the foregoing
sentence as of the date of this Agreement (the “Updated Electronic Data File”). No change
reflected in the Updated Electronic Data File shall constitute a Material Adverse Change to the
Business.
(b) No employee of any Acquired Subsidiary has provided written notice of his or her intention
to terminate employment with any Acquired Subsidiary or to terminate his or her employment upon a
sale of, or business combination relating to any Acquired Subsidiary or in connection with the
transactions contemplated by this Agreement. To Sellers’ Knowledge, no management employee of any
Acquired Subsidiary and no group of employees of any Acquired Subsidiary has any plans to terminate
his, her or their employment, and no Acquired Subsidiary has a present intention to terminate the
employment of any Acquired Subsidiary employee.
(c) Section 4.15(c) of the Disclosure Schedule lists each employment agreement with respect to
individuals working in the U.S. to which any Acquired Subsidiary is a party and copies of such
employment agreements and any amendments thereto have been provided to Buyers and lists any other
individual who is working for any Acquired Subsidiary in the U.S. who must be given at least 30
days notice of termination of employment. Except in the Ordinary Course of Business, with respect
to individuals working in the U.S. no Acquired Subsidiary has (i) entered into any agreement that
obligates it to make an offer of employment to any individual or (ii) promised or otherwise
provided assurances (contingent or other) to any applicant for employment, employee, consultant or
contractor of any Acquired Subsidiary of any terms or conditions of employment regarding business
following the Closing. Except as set forth on Section 4.15(c) of the Disclosure Schedule or as may
be required by law, no Acquired Subsidiary has any written employment contracts or oral agreement
of any nature that provides for employment for any particular period of time or that provides any
restrictions upon any Acquired Subsidiary’s right to terminate employment or imposes any obligation
on any Acquired Subsidiary to make any post-termination payment with any of the employees.
(d) Each Acquired Subsidiary is and at all times has been in material compliance with all
applicable Laws relating to employment, employment practices and labor relations. Except as
provided in Section 4.15(d) of the Disclosure Schedule, there are no workers’ compensation claims
or other claims by employees pending against any Acquired Subsidiary or, to the Sellers’ Knowledge,
any facts that would give rise to such a claim. To Sellers’ Knowledge, no employee or other
service provider of any Acquired Subsidiary is subject to any secrecy or non-competition agreement
or any other agreement or restriction of any kind that would impede in any way the ability of such
employee or service provider to carry out fully all activities of such employee or service provider
in furtherance of the Business.
(e) Section 4.15(e) of the Disclosure Schedule lists each employee working in the U.S. of each
Acquired Subsidiary as of the date of this Agreement who holds a temporary work authorization,
including X-0X, X-0, X-0 or J-1 visas or work authorizations (the “Work
45
Permits”), and shows for each such employee the type of Work Permit and the length of time
remaining on such Work Permit. Each Acquired Subsidiary and, to the Knowledge of Sellers, each
current employee, contractor and consultant, is in compliance with all applicable visa and work
permit requirements related to his or her employment or engagement with the Acquired Subsidiary in
the U.S. With respect to each Work Permit, all of the information that the Acquired Subsidiaries
provided to the Department of Labor and the Immigration and Naturalization Service or the
Department of Homeland Security (collectively, the “Department”) in the application for such Work
Permit was true and complete to Sellers’ Knowledge. The Acquired Subsidiaries received the
appropriate notice of approval from the Department with respect to each such Work Permit. No
Acquired Subsidiary has received any notice from the Department that any Work Permit has been
revoked, modified or suspended. There is no action pending or, to Sellers’ Knowledge, threatened
to revoke or adversely modify the terms of any Work Permit. Except as disclosed in Section 4.15(d)
of the Disclosure Schedule, no employee of any Acquired Subsidiary working in the U.S. is (i) a
non-immigrant employee whose status would terminate or otherwise be affected by the transactions
contemplated by this Agreement, or (ii) an alien who is authorized to work in the United States in
non-immigrant status. For each employee of the Acquired Subsidiaries working in the U.S. and hired
after November 6, 1986, the Acquired Subsidiaries have retained an Immigration and Naturalization
Service Form I-9, completed in accordance with applicable Laws. The Acquired Subsidiaries have
materially complied with all applicable Laws relating to immigration with respect to employees,
consultants and other service providers working outside the United States and have all required
authorizations. The acquiring entity assumes and accepts all visa and immigration related assets,
obligations and liabilities of Xxxxxxx Xxxxx Jr., Inc. attached to the Energy division with respect
to the individual identified on Section 4.15(e) of the Disclosure Schedule.
(f) (i) Each current employee is eligible to work in the country in which such individual is
employed or engaged by the Acquired Subsidiary and (ii) to the Knowledge of Sellers, each such
individual has satisfied all requirements under applicable Law related to such individual’s
employment or engagement in such country including, with respect to individuals employed in the
United States, the requirements under the Immigration Reform and Control Act of 1986, as amended,
and other Laws related to the employment of non-United States citizens applicable in the state in
which the employees or other service providers are employed or engaged. Employees of any Acquired
Subsidiary who perform services in the United States are either United States citizens or are
legally entitled to work in the United States under the Immigration Reform and Control Act of 1986,
as amended, other United States immigration laws and the laws related to the employment of
non-United States citizens applicable in the state in which the employees are employed. Each
employee who performs services outside the United States is legally entitled to work in the country
in which such employee performs services and the reporting and payment of, and withholding from,
such employee’s salary and other compensation complies in all material respects with all applicable
Laws in both the United States and the work country (including social security contributions, where
applicable). With respect to any employee who performs services outside the United States, each
Acquired Subsidiary is in compliance with all foreign employment, labor, health and safety and
other applicable Laws governing employment and the rights of employees and labor unions. There is
no pending dispute regarding the classification of employees, independent contractors and
consultants of any Acquired Subsidiary for purposes of any Laws, including federal and applicable
state Tax laws and laws applicable to Plans. Except as set forth in Section 4.15(f) of the
Disclosure Schedule,
46
all agreements for the provision of services other than as an employee can be cancelled with
less than ninety (90) days’ notice without penalty.
(g) Except as provided in Section 4.15(g) of the Disclosure Schedule, the Contemplated
Transactions will not cause any Acquired Subsidiary to incur or suffer any liability relating to,
or obligation to pay, any severance, bonus compensation, termination or other similar payment to
any Person or to accelerate the time of payment or vesting, or increase the amount of or otherwise
enhance any benefit due any Person.
(h) Within the last five years, no Acquired Subsidiary has experienced and, to Sellers’
Knowledge, there has not been threatened, any strike, work stoppage, slowdown, concerted refusal to
work overtime, lockout, picketing, leafleting, boycott, other labor dispute, union organization
attempt, demand for recognition from a labor organization or petition for representation under the
National Labor Relations Act or other applicable Law. No grievance, demand for arbitration or
arbitration proceeding arising out of or under any collective bargaining agreement is pending or,
to Sellers’ Knowledge, threatened. Except as provided in Section 4.15(h) of the Disclosure
Schedule, no Legal Action, proceedings, audits, investigations, charges, claims, complaints, or
grievances are pending or, to Sellers’ Knowledge, threatened respecting, involving, by or on behalf
of, any applicant for employment, any current employee or any former employee, or other service
provider, or any class of the foregoing, whether in the form of claims for employment
discrimination, harassment, retaliation, wrongful discharge, breach of contract, unfair business
practice, unfair labor practices, wage and hour, tort, unfair competition or otherwise.
(i) Except as set forth in Section 4.15(i) of the Disclosure Schedule, no Acquired Subsidiary
is covered by, a party to or bound by any collective bargaining agreement (whether written or oral
and whether with a trade union, employee representative, staff association or any other employee
body representing workers), no collective bargaining agreement is currently being negotiated, and
to Sellers’ Knowledge there are no labor unions or other organizations representing or purporting
or attempting to represent any employee or other service provider of any Acquired Subsidiary. For
the past five years, no Acquired Subsidiary has received an application or request for recognition
from any trade union in relation to current or former employees.
(j) Section 4.15(j) of the Disclosure Schedule contains a list of individuals who are
currently performing services. for any Acquired Subsidiary and are classified as “consultants” or
“independent contractors,” the respective compensation of each such “consultant” or “independent
contractor” and whether the Acquired Subsidiary is party to a consulting, independent contractor or
other agreement with the individual, including the individual or project name, role, rate or fee
and work location. Any such agreements have been delivered to Buyers and are set forth on Section
4.15(j) of the Disclosure Schedule.
4.16 Banking Relationships.
Set forth on Section 4.16 of the Disclosure Schedule are the names and locations of all banks
and other financial institutions in which the Acquired Subsidiaries have accounts, lines of credit,
safety deposit boxes and, with respect to each account, line of credit, and safety deposit
47
box, the names of all persons authorized to draw thereon or to have access to, as well as the
account numbers.
4.17 Vessels.
(a) Set forth on Section 4.17 of the Disclosure Schedule is a list of all vessels owned (the
“Owned Vessels”) by any of the Acquired Subsidiaries as of the date hereof. Upon the transfer of
the Owned Vessels pursuant to Section 3.1(g), no Acquired Subsidiary, including Energy Logistics,
Inc. and, for purposes of this Section 4.17(a) only, Liberty Services, Inc., will own any vessels.
Set forth on Section 4.17 of the Disclosure Schedule is a list of all customer owned vessels
operated by employees of the Acquired Subsidiaries as of the date hereof (the “Customer Owned
Vessels”). Upon the transfer of the Owned Vessels, the entry into the Secondment Agreement and the
amendment or termination of any agreements related to the Customer Owned Vessels, no Acquired
Subsidiary, including Energy Logistics, Inc. and, for purposes of this Section 4.17(a) only,
Liberty Services, Inc., will operate or charter any vessels or engage in any other activity subject
to the Merchant Marine Act of 1920 at the Effective Time, except for the operation of the Customer
Owned Vessels. There are no charter agreements between any Acquired Subsidiary, including Energy
Logistics, Inc. and, for purposes of this Section 4.17(a) only, Liberty Services, Inc., and any
customers or any other person related to the Customer Owned Vessels.
(b) Immediately prior to the transfer of the Owned Vessels pursuant to the bills of sale
between Xxxxx M/O Services, Inc. and Baker Vessels, Inc, Xxxxx/MO Services, Inc. will be the sole
owner of the Owned Vessels, and each Owned Vessel will be free and clear of any Encumbrances. As
of the Closing Date, Xxxxx M/O Services, Inc has transferred full and marketable title to the Owned
Vessels, free and clear of any encumbrances, to Xxxxx Vessels, Inc. Baker Vessels, Inc., Xxxxx/MO
Services, Inc., Xxxxx Holdings Corp and Baker are citizens of the United States with the meaning of
Section 50501 (a) and (d) of Xxxxx 00, Xxxxxx Xxxxxx Code.
(c) Each of the Owned Vessels was constructed in the United States and, to the extent any
Owned Vessel has been rebuilt, was rebuilt in the United States, and therefore each of the Owned
Vessels is entitled to trade in the US coastwise trades as described in Section 55101(a) of Xxxxx
00, Xxxxxx Xxxxxx Code.
(d) The eight Owned Vessels listed below currently are documented under the laws of the United
States by the United States Coast Guard with a valid coastwise endorsement with no restrictions
noted on the certificate of documentation.
Name | Official Number | |
BENGAL 1 |
592166 | |
BOB |
528623 | |
XXXXX |
641600 | |
XXX |
566353 |
48
Name | Official Number | |
XXXXX |
523723 | |
XXXX |
544299 | |
XXXXX |
635317 | |
SOUTH FORK |
524813 |
The remaining nine Owned Vessels each hold a Boat Registration Certificate issued by the State of
Louisiana Department of Wildlife and Fisheries Boat Registration and are permitted to operate in
the US coastwise trades as described in Section 55101(a) of Xxxxx 00, Xxxxxx Xxxxxx Code and engage
in all other services in which they have been and are currently engaged. Each of the Owned Vessels
holding a Boat Registration Certificate issued by the State of Louisiana Department of Wildlife and
Fisheries is in full compliance with all rules and regulations associated with such registration
and applicable to such Owned Vessels.
(e) Each of the Owned Vessels documented with the United States Coast Guard has been issued a
Certificate of Inspection and each Certificate is current and, except as specifically noted on the
Certificate, there are no requirements or restrictions on use applicable to each respective Owned
Vessel.
(f) Each of the Owned Vessels not currently laid up is well maintained and fully operational.
4.18 Customers and Suppliers.
(a) Except as set forth on Section 4.18(a) of the Disclosure Schedule, none of the largest 20
customers of the Acquired Subsidiaries (as measured by revenues of the Acquired Subsidiaries on a
consolidated basis during the two most recent fiscal years), which customers are set forth on
Section 4.18(a) of the Disclosure Schedule, has during the last two years materially reduced or
otherwise discontinued or materially adversely modified the terms on which products or services of
the Acquired Subsidiaries are purchased, or to the Sellers’ Knowledge threatened to materially
reduce or discontinue or materially adversely modify the terms in connection with the purchase of
such items from the Acquired Subsidiaries.
(b) Except as set forth on Section 4.18(b) of the Disclosure Schedule, none of the top 10
suppliers of the Acquired Subsidiaries (as measured by expenditures by each Acquired Subsidiary
during the two most recent fiscal years), which suppliers are set forth on Section 4.18(b) of the
Disclosure Schedule, has during the last two years materially reduced or otherwise discontinued or
materially adversely modified the terms on which such products or services are supplied, or to the
Sellers’ Knowledge threatened to materially reduce or discontinue or materially adversely modify
the terms in connection with supplying such items to the Acquired Subsidiaries. There are no
suppliers of products or services to any Acquired Subsidiary which are material and with respect to
which practical alternative sources of supply are not generally available to the Acquired
Subsidiaries.
49
4.19 Disclosure.
No representation or warranty by any Seller in this Agreement or in any exhibit, schedule,
written statement, certificate or other document delivered or to be delivered to Buyers pursuant
hereto or in connection with the consummation of the Contemplated Transactions contains any untrue
statement of a material fact or omits to state a material fact necessary to make the statements
contained herein or therein not misleading.
4.20 Brokers.
Except with respect to Xxxxxx Xxxxxx & Co. Inc., no agent, broker, investment banker or other
Person acting in a similar capacity on behalf of any Seller or under the authority of any Seller
will be entitled to any fee or commission, directly or indirectly, before or after Closing, from
Buyers, or after Closing from any Acquired Subsidiary in connection with any of the Contemplated
Transactions.
4.21 Sole Representations and Warranties.
The Sellers shall not be deemed to have made to Buyers any representation or warranty
regarding the Acquired Subsidiaries with respect to the Contemplated Transactions other than as
expressly made in this Agreement, the Schedules hereto and/or in any certificate delivered
hereunder by or on behalf of such Sellers.
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF THE SELLERS
REPRESENTATIONS AND WARRANTIES OF THE SELLERS
The Sellers, jointly and severally, represent and warrant to Buyers that the statements
contained in this Article V are true, correct and complete as of the date of this Agreement
and will be true, correct and complete as of the Closing Date (as though made then and as though
the Closing Date were substituted for the date of this Agreement throughout this Article V)
(unless such representation or warranty expressly relates to a specific date, in which case, as of
such date).
5.1 Organization, Authority and Enforceability, No Violations, Etc.
(a) Xxxxx is a corporation duly organized, validly existing and in good standing under the
Laws of the Commonwealth of Pennsylvania, and each Seller other than Xxxxx is a corporation duly
organized, validly existing and in good standing under the Laws of the State of Delaware. Each
Seller has the requisite power to execute and deliver this Agreement and the other Transaction
Documents to which it is or will be a party and to perform its obligations under each Transaction
Document. The execution and delivery by each Seller of each Transaction Document to which it is or
will be a party and the performance by each Seller of its obligations hereunder and thereunder have
been or shall be duly and validly authorized by all necessary corporate action on the part of such
Seller. Each Transaction Document to which each Seller is or will be a party has been, or upon its
execution and delivery will be, duly and validly executed and delivered by such Seller and is, or
upon the execution and delivery of such Transaction Document will be (assuming the valid
authorization, execution and delivery of such Transaction Document by the other parties thereto) a
valid and binding obligation of such Seller,
50
enforceable against such Seller in accordance with its terms, except to the extent that such
enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium or other
similar Laws relating to creditors’ rights generally and to general principles of equity. Xxxxx
Vessels, Inc. is a corporation duly organized validly existing and in good standing under the Law
of the Commonwealth of Pennsylvania.
(b) Except as set forth on Section 5.1(b) of the Disclosure Schedule, neither the execution
nor the delivery by each Seller of any Transaction Document to which it is or will be a party, the
consummation by each Seller of the transactions contemplated hereby and thereby, nor the
performance by each Seller of its obligations hereunder or thereunder will (i) violate any of the
provisions of the Sellers’ Fundamental Documents; (ii) violate any Law or Order applicable to any
Seller, (iii) violate, result in a breach of, or constitute a default of any provision of any
material contract or agreement to which such Seller is a party or by which the Shares may be bound,
except any such violation, breach or default which would not have a material adverse effect on such
Seller’s ability to perform its obligations under the Transaction Documents to which such Seller is
or will be a party, or (iv) result in the imposition or creation of an Encumbrance upon or with
respect to the Shares.
(c) No consent, authorization or approval or other action by, and no notice to or declaration,
filing or registration with, any Governmental Authority will be required to be obtained or made by
the Sellers or the Acquired Subsidiaries in connection with the due execution and delivery by
Sellers of this Agreement or the performance or consummation by the Sellers of the Contemplated
Transactions.
5.2 Ownership.
Each Seller holds of record and owns beneficially the Shares set forth next to its name on
Appendix B, free and clear of any restrictions on transfer (other than restrictions under federal
and state securities Laws), Taxes, Encumbrances, options, warrants, purchase rights, Contracts,
commitments, equities, claims, and demands. Except as set forth on Section 5.2 of the Disclosure
Schedule, no Seller is a party to any option, warrant, purchase right, or other Contract or
commitment that could require such Seller to sell, transfer, or otherwise dispose of any Shares
(other than this Agreement). Except as set forth on Section 5.2 of the Disclosure Schedule, no
Seller is a party to any voting trust, proxy, or other agreement or understanding with respect to
the voting of any Shares. Upon payment in full of the Purchase Price at Closing, good, valid and
marketable title to the Shares will pass to Buyers, free and clear of all Encumbrances and with no
restrictions on the voting rights or other incidents of record and beneficial ownership of such
Shares.
5.3 Brokers.
Except with respect to Xxxxxx Xxxxxx & Co., Inc., no agent, broker, investment banker or other
Person acting in a similar capacity acting on behalf of Sellers or under the authority of Sellers
is or will be entitled to any fee or commission directly or indirectly from Buyers, Sellers or any
Acquired Subsidiary after Closing in connection with any of the Contemplated Transactions.
51
5.4 Legal Action.
There are no Legal Actions pending or, to the Sellers’ Knowledge, threatened against or
affecting any Seller at law or in equity, or before or by any Governmental Authority that would
adversely affect any Seller’s performance under this Agreement or the consummation of the Closing.
5.5 Sole Representations and Warranties.
The Sellers shall not be deemed to have made to Buyers any representation or warranty
regarding the Sellers or with respect to the Contemplated Transactions other than as expressly made
in this Agreement, the Schedules hereto and/or in any certificate delivered hereunder by or on
behalf of such Seller.
ARTICLE VI
REPRESENTATIONS AND WARRANTIES OF BUYERS
REPRESENTATIONS AND WARRANTIES OF BUYERS
Buyers, jointly and severally, represent and warrant to the Sellers that the statements
contained in this Article VI are true, correct and complete as of the date of this
Agreement and will be true, correct and complete as of the Closing Date (as though made then and as
though the Closing Date were substituted for the date of this Agreement throughout this Article
VI) (unless such representation or warranty expressly relates to a specific date, in which
case, as of such date).
6.1 Organization, Authority and Enforceability, No Violations, Etc.
(a) Each Buyer is a corporation duly organized, validly existing, and in good standing under
the Laws of the State of its jurisdiction of incorporation. Each Buyer has all requisite power and
authority to execute and deliver this Agreement and each of the other Transaction Documents to
which it is or will be a party as contemplated hereby and to perform its obligations under each
such Transaction Document. The execution and delivery by each Buyer of each of the Transaction
Documents to which it is a party and the performance by each Buyer of its obligations thereunder
have been or will be duly and validly authorized by all necessary legal action on the part of such
Buyer. Each of the Transaction Documents to which each Buyer is a party has been, or upon its
execution and delivery will be, duly and validly executed and delivered by such Buyer and is, or
upon its execution and delivery will be (assuming the valid authorization, execution and delivery
of such Transaction Document by the other parties thereto) a valid and binding obligation of such
Buyer, enforceable against it in accordance with its terms, except to the extent that such
enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium or other
similar Laws relating to creditors’ rights generally and to general principles of equity.
(b) Neither the execution nor delivery by each Buyer of any of the Transaction Documents to
which it is or will be a party, nor the performance by each Buyer of its obligations hereunder or
thereunder, nor compliance by each Buyer with any of the provisions hereof or thereof will (i)
violate any of the provisions of Buyers’ Fundamental Documents; (ii) violate any Law or Order
applicable to any Buyer, or (iii) violate, result in a breach of, or constitute a default of any
provision of any material contract or agreement to which such Buyer
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is a party, except any such violation, breach or default which would not have an adverse
effect on such Buyer’s ability to perform its obligations under the Transaction Documents to which
such Buyer is or will be a party.
(c) No consent, authorization or approval or other action by, and no notice to or declaration,
filing or registration with, any Governmental Authority or any third party will be required to be
obtained or made by the Buyers in connection with the due execution and delivery by Buyers of this
Agreement or the performance or consummation by the Buyers of the Contemplated Transactions.
6.2 Legal Action.
There are no Legal Actions pending or, to any Buyer’s knowledge, threatened against or
affecting any Buyer at law or in equity, or before or by any Governmental Authority that would
adversely affect any Buyer’s performance under this Agreement or the consummation of the Closing.
6.3 Brokers.
No agent, broker, investment banker, or other Person acting in a similar capacity acting on
behalf of Buyers or under the authority of such Person is or will be entitled to any fee or
commission directly or indirectly from any of the Sellers prior to, or with respect to the Sellers,
after the consummation of the Contemplated Transactions, or in connection with the Contemplated
Transactions.
6.4 No Distribution, Investment Intent.
Each Buyer is acquiring the Shares hereunder for its own account, not as a nominee or agent,
for investment and not with a view to the distribution thereof in violation of any applicable
securities Law.
6.5 Resale Restrictions.
Buyers understand that (i) the Shares have not been, and will not be, registered or qualified
under any securities Laws, by reason of their sale in a transaction exempt from the registration or
qualification requirements of such Laws, and (ii) the Shares must be held indefinitely unless a
subsequent disposition thereof is registered or qualified under all applicable securities Laws or
is exempt from such registration or qualification.
6.6 Capitalization.
Each Buyer has sufficient capital to perform its obligations under this Agreement.
6.7 Sole Representations and Warranties.
Buyers shall not be deemed to have made to the Sellers any representation or warranty with
respect to the Contemplated Transactions other than as expressly made in this Article VI,
53
the Schedules hereto and/or in any certificate delivered hereunder by or on behalf of such
Buyers.
ARTICLE VII
PRE-CLOSING AND POST-CLOSING COVENANTS
PRE-CLOSING AND POST-CLOSING COVENANTS
7.1 Pre-Closing Covenants.
(a) Antitrust Notification; Efforts to Consummate; Consents.
(i) Each Party acknowledges and agrees that no notification is required to be filed by its
“ultimate parent entity” under the Xxxx Xxxxx Xxxxxx Antitrust Improvements Act of 1976, as
amended, and the rules and regulations promulgated thereunder with the United States Federal Trade
Commission or the Antitrust Division of the Department of Justice. Each Party shall consult with
the other Parties with respect thereto prior to making any communication, written or oral, with any
antitrust jurisdiction with respect to this Agreement or the Contemplated Transactions.
(ii) Upon the terms and subject to the conditions of this Agreement, each of the Parties shall
use its commercially reasonable efforts to take, or cause to be taken, all appropriate action, and
to do, or cause to be done, all things necessary, proper or advisable under applicable Laws or
otherwise to cause the fulfillment of the conditions to Closing set forth herein and to consummate
and make effective the Contemplated Transactions including, without limitation, using its
commercially reasonable efforts to obtain all permits, consents, approvals, authorizations,
qualifications and orders of Government Authorities and parties to Contracts with the Acquired
Subsidiaries as are necessary for the consummation of the Contemplated Transactions and to fulfill
the conditions to the Closing.
(iii) Without limiting the generality of Section 7.1(a)(ii), at the Sellers’ sole
costs and expense, Sellers shall cause the Acquired Subsidiaries to give any notices to third
parties, and shall cause the Acquired Subsidiaries to use their commercially reasonable efforts, to
obtain any third party consents referred to in Section 4.10(b) and the items set forth in
Section 4.10(b) of the Disclosure Schedule prior to the Closing. Buyers shall have the right to
approve (which approval shall not be unreasonably withheld or delayed) the form of consent and
transmittal letter used to transmit any necessary third party consent. Buyers shall not be
obligated to give any consideration or assume any Liability in connection with obtaining any
necessary third party consent. The Sellers shall not consent to any material modification or
amendment of any term of a Contract to obtain a required third party consent without the prior
written consent of Buyers.
(iv) In case, at any time after the Closing Date, any further action is necessary or desirable
to carry out the purposes of this Section 7.1(a), the proper officers and directors of each
Party shall use its commercially reasonable efforts to take all such action.
(b) Conduct of Business.
(i) From the date hereof until the Closing, the Sellers and the Acquired Subsidiaries (A)
shall conduct the Business in the Ordinary Course of Business on a basis
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consistent with past practice, (B) shall use commercially reasonable efforts to preserve
intact the current business structure of the Business and to preserve the relationships and
goodwill of the Acquired Subsidiaries with customers, distributors, suppliers, employees and others
having business relations with the Acquired Subsidiaries, and (C) shall use commercially reasonable
efforts to keep available the services of the key employees listed on Schedule 7.1(b) and other
employees of the Business.
(ii) Except as otherwise expressly contemplated by this Agreement or agreed to by Buyers in
writing, from the date hereof until the Closing, the Sellers shall cause the Acquired Subsidiaries
to:
(A) not authorize for issuance, issue and delivery 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;
(B) not amend or modify the Fundamental Documents of any Acquired Subsidiary;
(C) not sell, transfer or assign any interests in any Acquired Subsidiary, or otherwise
fail to maintain control of any Acquired Subsidiary over which it has control as of the date
hereof;
(D) (i) not sell any material Assets having an aggregate book value of greater than
$100,000 other than in the Ordinary Course of Business consistent with past practice or (ii)
not enter into any Contract or agreement relating to the Business involving the receipt or
payment of more than $5,000,000 in any twelve (12)-month period;
(E) (i) perform in all material respects all of the obligations relating to the
Business under, and shall 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) or (ii) not materially amend any Material
Contract;
(F) maintain the Current Policies;
(G) continue to make capital expenditures in accordance with budget previously approved
with respect to the Business;
(H) except in the Ordinary Course of Business consistent with past practice or as may
be required under the terms of any Plan or Contract, not (i) grant any severance, retention
or termination pay to, or amend any existing severance, retention or termination arrangement
with, any current or former director, officer or employee of any Acquired Subsidiary, (ii)
increase or accelerate the payment or vesting of, benefits payable under any existing
severance, retention or termination pay policies or employment agreements, (iii) enter into
or amend any employment, consulting, deferred compensation or other similar agreement with
any Person, (iv) establish, adopt, amend or
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terminate, or materially increase the benefits provided under, any collective
bargaining agreement, retention agreement or Plan (except as required by applicable Law or
the Plan) or (v) materially increase the compensation, bonus or other benefits payable to
any director, officer or employee, consultant, independent contractor of any Acquired
Subsidiary;
(I) not (i) abandon or fail to maintain any Intellectual Property Rights, or (ii)
license, assign, sell or otherwise transfer any Intellectual Property Rights of any Acquired
Subsidiary;
(J) not settle any litigation relating to the Business;
(K) not enter into any transaction with any Related Party.
(L) not take any action set forth in Section 4.2(e); and
(M) take any action, or fail to take any commercially reasonable action within their
control, the result of which any of the changes or events listed in this Section
7.1(b) are likely to occur.
(c) Notices of Certain Events.
(i) Xxxxx shall promptly notify Buyers of:
(A) any material Legal Actions that become pending relating to the Business or that
relate to the consummation of the Contemplated Transactions; or
(B) the damage or destruction by fire or other casualty of any material Assets or in
the event that any material Assets become the subject of any proceeding for the taking
thereof or any part thereof.
(ii) Each Party shall promptly notify each other Party of any notice or other communication
from any Governmental Authority in connection with the Contemplated Transactions.
(iii) From the date hereof until the Closing, each Party shall notify the other Parties in
writing of any event, condition, fact, circumstance or development that occurs, arises or exists
after the date of this Agreement that would cause (i) a Breach of any of the representations and
warranties made by the notifying Party in this Agreement, or (ii) a Breach of any covenant or
obligation of the notifying Party. Notwithstanding the foregoing, solely for purposes of
determining whether the conditions to Buyers’ obligation to consummate the Closing set forth in
Section 3.1 have been satisfied, no disclosure by any Party pursuant to this Section
7.1(c)(iii) shall be deemed to amend or supplement the Disclosure Schedule or to prevent or
cure any misrepresentation or Breach of warranty or covenant. The Parties agree that any matter
set forth in a notice delivered pursuant to this Section 7.1(c) after the execution of this
Agreement but prior to the Closing shall give rise to a claim by the notified party under
Article IX. The Parties agree that the Parties shall use commercially reasonable efforts
to not take any action, or enter into any transaction, which would cause any of their respective
representations or
56
warranties contained in this Agreement to be untrue or result in a Breach of any covenant made
by the applicable Party in this Agreement.
(d) No Negotiation. Until such time, if any, as this Agreement is terminated pursuant
to Article X, Sellers will not, and will cause each Acquired Subsidiary and each of their
representatives not to, directly or indirectly solicit, initiate or encourage any inquiries or
proposals from, discuss or negotiate with, provide any non-public information to, or consider the
merits of any unsolicited inquiries or proposals from, any Person (other than Buyers) relating to
any transaction involving the sale of the Business or Assets (other than in the Ordinary Course of
Business) of any Acquired Subsidiary, or any of the capital stock of any Acquired Subsidiary, or
any merger, consolidation, business combination or similar transaction involving any Acquired
Subsidiary.
(e) Access to Information and Employees. Sellers will, and shall cause the Acquired
Subsidiaries to, continue to provide the Buyers and its accountants, counsel, financial advisors
and other representatives, reasonable access during normal business hours to its properties,
personnel, books, Contracts, commitments and records; provided, however, that the foregoing right
of access shall not require furnishing information that, in the reasonable opinion of Sellers’
outside counsel, would violate any Laws. Promptly following the execution of this Agreement, and
generally throughout the period preceding Closing, Sellers will cause the Acquired Subsidiaries to
provide Buyers reasonable access during normal business hours to such employees as Buyers may
reasonably identify for the purposes of discussing eventual business integration and Buyers’
proposed terms and conditions of their future employment with the Acquired Subsidiaries.
(f) Delivery of Certain Financials. Prior to Closing, Sellers shall deliver to Buyers
within 30 days after each month end, unaudited combined financial statements of the Acquired
Subsidiaries as of the end of each month. All such financial statements shall be in form and
substance comparable to the Interim Financial Statements.
(g) Directors’ and Officers’ Insurance. For a period of three years following the
Closing, Sellers shall provide insurance coverage for pre-closing acts and omissions for each
person who, prior to the Effective Time, served as an officer or director of any Acquired
Subsidiary and was covered by Sellers’ director and officer insurance in connection with its annual
renewal of director and officer insurance coverage.
7.2 Post-Closing Covenants.
The Parties agree as follows with respect to the period following the Closing:
(a) General. In case at any time after the Closing any further action is necessary or
desirable to carry out the purposes of this Agreement, each of the Parties will take such further
action (including the execution and delivery of such further instruments and documents) as any
other Party reasonably may request, all at the sole cost and expense of the requesting Party
(unless the requesting Party is entitled to indemnification therefor under Article VIII or
IX below). The Sellers acknowledge and agree that from and after the Closing, Buyers will be
entitled to possession of all documents, books, records (including Tax records),
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agreements, and financial data of any sort relating to the Acquired Subsidiaries; provided,
however, that during the seven (7) year period following the Closing Date, the Sellers shall have
access to and the right to copy books and records (including Tax records) for the purposes of (i)
preparing or responding to any inquiry regarding any Tax Returns required to be filed by the
Sellers, including, without limitation any Tax Returns filed by any Acquired Subsidiary with
respect to periods prior to the Closing, or (ii) responding to any indemnification claim against
Sellers with respect to a Breach of the representations and warranties set forth in Section
4.11.
(b) Transition. No Seller will take any action that is designed or intended to have
the effect of discouraging any lessor, licensor, customer, supplier, or other business associate of
any Acquired Subsidiary from maintaining the same business relationships with the Acquired
Subsidiaries after the Closing as it maintained with the Acquired Subsidiaries prior to the
Closing.
(c) Use of Name; Name Changes. Within sixty (60) days following the Closing, Buyers
shall cease to use the name “Xxxxxxx Xxxxx”, and within one (1) year following Closing, Buyers
shall cease to use the name “Xxxxx” in connection with the operation of the Business and shall have
taken all action necessary in relation thereto, including without limitation, changing the name of
all Acquired Subsidiaries that contain “Xxxxx” or “Xxxxxxx Xxxxx” therein.
(d) No WARN Liability. Buyers shall not take any actions that could reasonably be
expected to impose any requirements or liability upon the Sellers or the Acquired Subsidiaries
under the United States Worker Adjustment and Retraining Notification Act.
(e) Houston Lease. If Xxxxx is not released from its obligations under the Parent
Company Guarantee agreement dated August 25, 2005 (the “Parent Company Guarantee”) related
to the Northbelt Lease Agreement as of the Closing, Buyers shall use their commercially reasonable
efforts after the Closing to obtain from applicable third parties such release and will indemnify
Xxxxx for any losses in connection with the Parent Company Guarantee arising from the conduct of
the Business after the Closing.
(f) Confidentiality; Noncompetition and Nonsolicitation.
(i) Each of the Sellers acknowledges and agrees that in their respective capacities as the
equity owners of the Acquired Subsidiaries, Sellers have been privy to Confidential Information
regarding the Acquired Subsidiaries and the Business. Each of the Sellers agrees that it shall not
use or disclose to others, and shall prevent their respective Affiliates, directors, officers,
employees and agents from using or disclosing to others, directly or indirectly, any Confidential
Information regarding the Acquired Subsidiaries and the Business. “Confidential
Information” means all confidential and proprietary information of, about or created by or for
the Acquired Subsidiaries or the Business, including without limitation, (i) information regarding
clients, customers, suppliers and vendors, (ii) information relating to business plans or
prospective business of the Acquired Subsidiaries, (iii) any confidential or proprietary records
concerning the products or services provided to customers of the Business; (iv) any information
containing sensitive or non-public pricing policies or order histories, including prices charged or
discounts or specific payment terms made available to customers or
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obtainable by the Acquired Subsidiaries or the Business from their respective suppliers; (v)
customer and supplier lists; (vi) financial information; forecasts, budgets, marketing information,
research and development, expansion plans, management policies and methods of operation, (vii)
information concerning wages and salaries and other personnel information relative to employees of
the Business; (viii) technical data specifications, programs, documentation and analyses, and (ix)
any proprietary knowledge, trade secrets, data, formulae, specifications, pricing, information,
business plans (present and future), strategies, marketing concepts and information, testing
information and all papers and other records (including computer records) containing Confidential
Information. Each Seller acknowledges and agrees that such Confidential Information is
specialized, unique in nature and of great value to the Business and that such information gives
the Business a competitive advantage.
(ii) As an inducement to the Buyers to enter into this Agreement and to provide Sellers the
consideration described herein, each of the Sellers hereby covenants and agrees with the Buyers and
the Acquired Subsidiaries that, during a period of five (5) years commencing on the Closing Date,
it shall not, directly or indirectly, own, manage, operate or control, or engage, join or
participate in the ownership, management, operation or control of, or furnish any capital or loans
to, or be connected in any manner with, any Person or business that competes in any manner
whatsoever with the Business; provided, however, that the foregoing shall not prohibit the
acquisition of up to 1% of outstanding securities in a publicly traded company for investment
purposes and further provided that nothing in this Section 7.2(f) shall restrict in any way the
ability of Xxxxx and its Affiliates to perform engineering, construction inspection, or
construction management services and/or to act as general contractor or in a similar capacity with
respect to a project in which a third party is providing construction services.
(iii) For a period of five (5) years following the Closing Date, each of the Sellers agrees
that it shall not, directly or indirectly, (a) solicit the business of any present or former
customers, clients or other Persons from whom any Acquired Subsidiary derived revenues during the
two (2) year period prior to the Closing Date for the purpose of competing with the Business, or
(b) persuade or attempt to persuade any present or future customer, distributor, client, vendor,
service provider, supplier, contractor or any other Person having material business dealings with
any Acquired Subsidiary to cease doing business with any of the Acquired Subsidiaries (or any such
former customer, distributor, vendor, service provider, supplier, contractor or any other Person
who has had material business dealings with any Acquired Subsidiary during the two (2) year period
prior to Closing), or (c) otherwise intentionally disrupt, damage, impair or interfere in any
manner with the Business or any Acquired Subsidiary, or (d) induce any person who is or has been an
employee, consultant, or independent contractor of any Acquired Subsidiary as of the Closing Date
or during the two (2) year period preceding the Closing Date to terminate his or her relationship
with the Acquired Subsidiary or offer any such person employment.
(iv) Each of the parties making the covenants in this Section 7.2(f) acknowledges and
recognizes that (a) the businesses and markets of the Acquired Subsidiaries are conducted
throughout the world, (b) Buyers are investing substantial sums of money to acquire the Shares from
the Sellers, (c) Buyers would not be doing so but for the covenants contained in this Agreement,
and (d) such covenants are necessary in order to protect and
59
maintain the proprietary interests and other legitimate business interests of the Acquired
Subsidiaries, the Business, and the prospective business of the Acquired Subsidiaries and (e) such
covenants are reasonable in light of the foregoing. Each of the Sellers further acknowledges and
agrees that the geographic scope and duration of the foregoing covenants not to compete and
non-solicitation covenants are reasonable.
(v) If any Governmental Authority determines that any of the covenants or other provisions
contained in this Section 7.2(f), or any part hereof, is invalid or unenforceable, the
remainder of such covenants and this Agreement shall not thereby be affected and shall be given
full effect without regard to the invalid portions. If any Governmental Authority determines that
any of the covenants contained in this Section 7.2(f), or any part hereof, are
unenforceable because of the duration of such provision or the Persons, products, services or area
covered thereby or for any other reason, such Governmental Authority shall have the power and the
Parties intend and desire that such Governmental Authority, and in connection with the purchase of
the Shares, the Buyers are relying on such Governmental Authority to, exercise such power to reduce
the duration or coverage of such provision to the minimum extent necessary to render such provision
enforceable, and in its reduced form, such provision shall then be deemed enforceable and shall be
enforced.
(vi) Each party intends to and does hereby confer jurisdiction to enforce the covenants and
other provisions contained in this Section 7.2(f), upon the courts and Governmental
Authorities of any jurisdiction within the geographic scope of such covenants or other provisions.
If the courts of any one or more of such jurisdictions holds such covenants or other provisions
wholly unenforceable by reason of the breadth of such scope or otherwise, it is the intention of
each Party that such determination not bar or in any way adversely affect the rights of the Buyers
to relief in the courts of any other jurisdiction within the geographic scope of such covenants or
other provisions, as to breaches of such covenants or other provisions in any such other
jurisdiction, such covenants or other provisions as they relate to each jurisdiction and geographic
location being, for this purpose, severable into diverse and independent covenants and other
provisions.
(vii) Each of the Sellers hereby agrees that its violation or attempted or threatened
violation of the covenants or other provisions contained in this Section 7.2(f), or any
part thereof, will cause irreparable injury to the Business and the Buyers for which money damages
would be inadequate, and that the Business and the Buyers shall be entitled, in addition to any
other rights or remedies that may be available to them at law or in equity, to an injunction
enjoining and restraining the Sellers, from violating or attempting or threatening to violate any
provision of this Section 7.2(f). The duration of the covenants and other provisions
contained in this Section 7.2(f) shall be extended as to each applicable Person by a period
equal to the duration of any breach or violation thereof by such Person.
(g) Seller Release. As of immediately after the Closing and effective upon payment by
the Buyers of the Purchase Price to which such Seller is entitled at Closing, each Seller, to the
fullest extent permitted by applicable Law, hereby releases and forever discharges the Acquired
Subsidiaries, Buyers, their subsidiaries and Affiliates, and their respective successors and
assigns (individually, a “Releasee” and collectively, “Releasees”) from any and all
losses, costs, expenses, Liabilities, damages, claims, demands, proceedings, causes of action,
60
orders, judgments, obligations, Contracts, agreements, debts and liabilities whatsoever,
whether known or unknown, suspected or unsuspected, both at law and in equity (“Claims”),
which such Seller now has, has ever had or may hereafter have against the respective Releasees to
the extent arising as a result of such Seller’s equity ownership or investment in the Acquired
Subsidiaries on and prior to the Closing Date, or as a result of any matter required to be
disclosed in the Disclosure Schedule and not so disclosed (collectively, the “Released
Matters”). For the avoidance of doubt, in no event shall the foregoing release and discharge
extend to, and in no event shall the Released Matters include, (a) any Claims or rights of such
Seller under any Contract, agreement or arrangement disclosed in the Disclosure Schedule, or (b)
any Claims or rights of any Seller that relates to any obligation of the Buyers or post-Closing
obligation of the Business under this Agreement.
(h) Sellers’ Website. On and after Closing, the Sellers shall cause those parts of
their website accessible at URL xxxx://xxx.xxxxxxxxxxx.xxx as it relates to the Acquired
Subsidiaries or the Business to automatically redirect visitors to xxxx://xxx.xxxxxxxxx.xxx or such
other URL as Buyers may require (such re-direction to remain in place until Buyers otherwise direct
or, if earlier, a period of 6 month after Closing).
(i) Claims Under Insurance Policies. As reasonably requested by either Party after
the Closing, each Party shall, and shall cause its respective Affiliates to, cooperate with the
other parties in respect of any Claims made under the insurance policies based upon actions,
inactions and events occurring prior to the Closing Date. The Sellers agree not to, and shall not
permit their Affiliates to, limit, modify or otherwise compromise the Buyers’ ability to make
claims under any such insurance policies.
(j) Insured Claims Adjustment. To the extent that the Insurance Reserve exceeds the
aggregate amount of any and all payments made by the Acquired Subsidiaries or their successors and
assigns during the period beginning at the Effective Time and ending on the seventh
(7th) anniversary of the Closing Date that arise from or relate to any Insured Claim
(including any insurance deductibles and reasonable expenses related thereto), Buyers shall pay to
the Sellers an amount equal to such excess within thirty (30) days following the seventh
(7th) anniversary of the Closing Date.
(k) Storm Cat Receivables. Buyers hereby acknowledge that while no value will be
assigned to the Storm Cat Receivables under Section 2.4(b), the Storm Cat Receivables and
all rights and obligations associated therewith shall be transferred to, or retained by, Xxxxx/MO
Services, Inc. as part of the sale of the stock of Xxxxx/MO Services, Inc. In the event Xxxxx/MO
Services, Inc. collects any amount of the Storm Cat Receivables, whether in the form of a cash
payment made in respect of such receivables or in the form of other value received by Xxxxx/MO
Services, Inc. in respect of such receivables pursuant to any action or proceeding taken or made in
connection therewith, including bankruptcy, reorganization, enforcement of lien rights, or the
exchange of anything of value created prior to the Closing (a “Collected Amount”), Buyers
shall cause Xxxxx/MO Services, Inc. to pay to Xxxxxxx Xxxxx Jr., Inc. in cash an amount equal to
50% of the net after Tax value of such Collected Amount; provided, however, that in
the event any equity interests are received by Buyers in respect of such receivables, Buyers shall
transfer and assign to Xxxxxxx Xxxxx Jr., Inc. 50% of such equity interests or if a direct
assignment is impractical, then Buyers will transfer and assign to Xxxxxxx Xxxxx Jr., Inc. an
61
undivided 50% interest in such equity interests. Neither Buyers nor their affiliates shall
take any action inconsistent with the collection of the Storm Cat Receivables. Buyers’ obligations
under this Section 7.2(k) shall survive indefinitely.
(l) SIEX Registration. Sellers shall cooperate with Buyers and will take such further
action (including the execution and delivery of such further instruments and documents) as the
Buyers reasonably may request to register Xxxxx Energy de Venezuela, C.A. under the
Superintendencia de Inversiones Extranjeras.
(m) Payments Submitted to Incorrect Payee. If any Party receives a payment from a
third party which belongs to another Party hereto, the Party who receives the payment agrees to
hold in trust and promptly remit such payment to the Party entitled thereto. If either Party
receives a payment from a customer that cannot be identified to a specific invoice or obligation,
the recipient shall, if reasonable under the circumstances, inquire of the customer as to the
intended application thereof and, lacking a response, the payment shall be applied to the oldest
outstanding undisputed invoice relating to the payor.
(n) Existing Bonds and Bank Debt. Buyers shall use their commercially reasonable
efforts to put into place, as promptly as practicable and at Buyers’ sole expense, new bonds
(“Replacement Bonds”) to replace the Existing Bonds. Sellers agree to cause each of the
Existing Bonds to remain outstanding from and after the Closing until the earlier to occur of (i)
the date upon which the Replacement Bonds have been put into place in accordance with the preceding
sentence or (ii) the date which is ninety (90) days following the Closing Date. Upon the
expiration of such ninety (90) day period or the earlier termination of Sellers obligation to
maintain in place the Existing Bonds, Sellers shall be under no further obligation to maintain in
place the Existing Bonds. In the event of any call on Existing Bonds which arises from or relates
to events or circumstances occurring following the Closing, Buyers shall indemnify Sellers for the
full amount of Damages incurred by Sellers or their affiliates in connection with such call on the
Existing Bonds. Sellers shall use their best efforts to cause the Acquired Subsidiaries to be
released from all of the Acquired Subsidiaries’ obligations and liabilities with respect to any
bank indebtedness in which any of the Sellers is a debtor and Sellers shall indemnify and hold the
Buyers and Acquired Subsidiaries harmless from and against any liabilities or obligations related
to such indebtedness.
(o) Buyers’ Obligation to Pursue Collection. From and after the Closing, Buyers shall
cause the Acquired Subsidiaries to use commercially reasonable efforts to pursue the collection of
all Accounts Receivable and Unbilled Accounts Receivable in the Ordinary Course of Business.
(p) Workers Compensation Payment. In the event Xxxxx or one of its Affiliates pays
any amount pursuant to a workers compensation policy held in the name of Xxxxx or any of its
Affiliates which payment relates to an employee or former employee of an Acquired Subsidiary or an
Affiliate thereof, then Buyers shall promptly, but in any event within five (5) days of receipt of
each such notice, pay to Xxxxx by wire transfer of immediately available funds the full amount of
such payment. The parties agree that the intent of the foregoing is for Xxxxx and its Affiliates
to be reimbursed in full within the prescribed time period for all workers compensation related
payments made in respect of employees or former employees of an Acquired Subsidiary
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or Affiliates thereof following the Closing to the extent of any Insurance Reserve (reduced
from time-to-time by claims against the Insurance Reserve).
ARTICLE VIII
TAX MATTERS
TAX MATTERS
The following provisions shall govern the allocation of responsibility as between Buyers and
Sellers for certain Tax matters following the Closing Date:
8.1 Tax Indemnification.
Each Seller shall jointly and severally indemnify the Acquired Subsidiaries, Buyers, and each
Buyer Affiliate and hold them harmless from and against any loss, claim, liability, expense, or
other damage attributable to (i) all Taxes (or the non-payment thereof) of the Acquired
Subsidiaries for all taxable periods ending on or before the Closing Date and the portion through
the end of the Closing Date for any taxable period that includes (but does not end on) the Closing
Date (‘‘Pre-Closing Tax Period’’), (ii) all Taxes of any member of an affiliated,
consolidated, combined or unitary group of which any Acquired Subsidiary (or any predecessor of any
of the foregoing) is or was a member on or prior to the Closing Date, including pursuant to
Treasury Regulation Section 1.1502-6 or any analogous or similar state, local, or non-U.S. law or
regulation, and (iii) any and all Taxes of any person (other than the Acquired Subsidiaries)
imposed on an Acquired Subsidiary as a transferee or successor, by Contract or pursuant to any Law,
rule, or regulation, which Taxes relate to an event or transaction occurring before the Closing,
but only to the extent that the aggregate amount of loss, claim, liability, expense, or other
damage attributable to Taxes in items (i), (ii) and (iii) exceeds the aggregate reserves for Tax
Liability (rather than any reserve for deferred Taxes established to reflect timing differences
between book and Tax income). Notwithstanding anything in this Agreement to the contrary, it is
understood and agreed that the indemnity obligation contained in this Section 8.1 is not
subject to any of the limitations, restrictions or other qualifications contained in Article IX
other than the survival limitation contained in Section 9.1(ii); accordingly, the indemnity
obligation contained in this Section 8.1 is not subject to the Threshold, the Basket or the
Cap.
8.2 Straddle Period.
In the case of any taxable period that includes (but does not end on) the Closing Date (a
“Straddle Period”), the amount of any Taxes based on or measured by income or receipts of
the Acquired Subsidiaries for the Pre-Closing Tax Period shall be determined based on an interim
closing of the books as of the close of business on the Closing Date (and for such purpose, the
taxable period of any partnership or other pass-through entity in which the Acquired Subsidiaries
holds a beneficial interest shall be deemed to terminate at such time) and the amount of other
Taxes of the Acquired Subsidiaries for a Straddle Period that relates to the Pre-Closing Tax Period
shall be deemed to be the amount of such Tax for the entire taxable period multiplied by a fraction
the numerator of which is the number of days in the taxable period ending on the Closing Date and
the denominator of which is the number of days in such Straddle Period.
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8.3 Responsibility for Filing Tax Returns.
(a) Consolidated Group. With respect to those Acquired Subsidiaries that are part of
Xxxxx’x consolidated return, Xxxxx shall include the income of those Acquired Subsidiaries
(including any deferred items triggered into income by Treasury Regulation Section 1.1502-13 and
any excess loss account taken into income under Treasury Regulation Section 1.1502-19) on Xxxxx’x
consolidated federal income Tax Returns for all periods through the close of business on the
Closing Date and pay any federal income Taxes attributable to such income. For all taxable periods
ending on or before the Closing Date, Xxxxx shall cause such Acquired Subsidiaries to join in
Xxxxx’x consolidated federal income tax return and, in jurisdictions requiring separate reporting
from Xxxxx, to file separate company foreign, state and local income Tax Returns or such other
foreign, state and local Tax Returns as shall be legally required. All such Tax Returns shall be
prepared and filed in a manner consistent with prior practice, except as required by a change in
applicable Law. Buyers shall have the right to review and comment on any such Tax Returns prepared
by Xxxxx, provided, however, that Buyers shall have no right to review a return that includes an
entity other than the Acquired Subsidiaries. Buyers shall cause the Acquired Subsidiaries to
furnish information to Xxxxx as reasonably requested by Xxxxx to allow Xxxxx to satisfy its
obligations under this section in accordance with past custom and practice. The Acquired
Subsidiaries and Buyers shall consult and cooperate with Xxxxx as to any elections to be made on
returns of the Acquired Subsidiaries for periods ending on or before the Closing Date. “Foreign”
for purposes of this Section 8.3 shall include any jurisdiction, including the United
States or any foreign country.
(b) Periods After the Closing Date. Buyers shall cause the Acquired Subsidiaries to
file income Tax Returns and other Tax Returns, or shall include the Acquired Subsidiaries in its
combined or consolidated income Tax Returns or other Tax Returns, for all periods (including
Straddle Periods) other than periods ending on or before the Closing Date and shall file or cause
to be filed all foreign, state or local Tax Returns as shall be legally required for such periods
ending after the Closing Date.
(c) Nigeria. Notwithstanding Sections 8.3(a) and (b), in the case of Overseas
Technical Services Nigeria, Ltd., Xxxxx O&M International, Ltd., and Overseas Technical Services
International, Ltd. whose fiscal years end on September 30, 2009, Buyer shall cause each of
Overseas Technical Services Nigeria, Ltd., Xxxxx O&M International, Ltd., and Overseas Technical
Services International, Ltd. to file the income Tax Return and any other Tax Returns as shall be
legally required for the period ending September 30, 2009. Buyers shall consult and cooperate with
Xxxxx as to any elections to be made on such returns.
(d) Forms 5471. Xxxxx shall file Forms 5471 for the Acquired Subsidiaries who are
part of Xxxxx’x consolidated federal tax return for 2009. Such Forms 5471 will include financial
information for the twelve month period ending December 31, 2009. Buyers shall cause the Acquired
Subsidiaries to furnish information to Xxxxx as reasonably requested by Xxxxx to allow Xxxxx to
satisfy its obligations under this section in accordance with past custom and practice.
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8.4 Cooperation on Tax Matters.
(a) Buyers, the Acquired Subsidiaries, and Sellers shall cooperate fully, as and to the extent
reasonably requested by the other Party, in connection with the filing of Tax Returns pursuant to
Section 8.3 and any audit, litigation or other proceeding with respect to Taxes. Such
cooperation shall include the retention and (upon the other Party’s request) the provision of
records and information that are reasonably relevant to any such audit, litigation or other
proceeding and making employees available on a mutually convenient basis to provide additional
information and explanation of any material provided hereunder. The Acquired Subsidiaries and
Sellers agree to retain all books and records with respect to Tax matters pertinent to the Acquired
Subsidiaries relating to any taxable period beginning before the Closing Date until the expiration
of the statute of limitations (and, to the extent notified by Buyers or Sellers, any extensions
thereof) of the respective taxable periods, and to abide by all record retention agreements entered
into with any taxing authority.
(b) Buyers and Sellers further agree, upon reasonable request by any Party, to obtain any
certificate or other document from any Governmental Authority or any other Person as may be
reasonably necessary to mitigate, reduce or eliminate any Tax that could be imposed (including, but
not limited to, with respect to the Contemplated Transactions contemplated hereby).
(c) Buyers and Sellers further agree, upon request, to provide the other Party with all
information that either Party may be required to report pursuant to Code Section 6043, or Code
Section 6043A, or Treasury Regulations promulgated thereunder.
8.5 Tax-Sharing Agreements.
All tax-sharing agreements or similar agreements with respect to or involving the Acquired
Subsidiaries shall be terminated as of the Closing Date and, after the Closing Date, the Acquired
Subsidiaries shall not be bound thereby or have any liability thereunder and Xxxxxxx Xxxxx
Corporation shall indemnify and hold the Acquired Subsidiaries harmless from and against any
liability arising thereunder.
8.6 Certain Taxes and Fees.
All transfer, documentary, sales, use, stamp, registration and other such Taxes, and all
conveyance fees, recording charges and other fees and charges (including any penalties and
interest) incurred in connection with consummation of the Contemplated Transactions shall be paid
by Buyers when due, and Buyers will, at their own expense, file all necessary Tax Returns and other
documentation with respect to all such Taxes, fees and charges, and, if required by applicable Law,
Sellers will join in the execution of any such Tax Returns and other documentation. Each Party
shall use commercially reasonable efforts to avail itself of any available exemptions from any such
Taxes and fees and to cooperate with the other Parties in providing any information and
documentation that may be necessary to obtain such exemptions.
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8.7 Audits.
Xxxxx shall inform Buyers of the existence and progress of any audit of Xxxxx’x consolidated
federal income Tax Returns to the extent that such returns relate to any Acquired Subsidiary.
Xxxxx shall not settle any such audit in a manner that would adversely affect the Acquired
Subsidiary after the Closing Date without the prior written consent of Buyers, which consent shall
not be unreasonably withheld.
8.8 Carrybacks.
Buyers shall elect to forego the carryback of a loss, credit or tax attribute of any of the
Acquired Subsidiaries from any period ending after the Closing Date to the Xxxxx consolidated Tax
Return, to the extent possible. If such an election is not available, Xxxxx shall immediately pay
to Buyers 100% any Tax refund (or reduction in Tax liability) resulting from a carryback of a
post-acquisition Tax attribute of any of the Acquired Subsidiaries into the Xxxxx consolidated Tax
Return, when such refund (or reduction) is realized by Xxxxx’x group. At Buyers’ request, if an
election to forego a carryback is not available, Xxxxx will cooperate with the Acquired
Subsidiaries in obtaining such refund (or reduction), including through the filing of amended Tax
Returns or refund claims. Buyers agree to indemnify Xxxxx for any Taxes resulting from the
disallowance of such post-acquisition Tax attribute on audit or otherwise to the extent of any
payment made by Xxxxx to the Acquired Subsidiaries with respect to such attribute.
8.9 Retention of Carryovers.
Xxxxx shall not elect to retain any net operating loss carryovers, capital loss carryovers or
any other Tax attribute of the Acquired Subsidiaries.
8.10 Section 338(g) Election.
Buyer shall not make a Section 338(g) election with respect to the Acquired Subsidiaries.
ARTICLE IX
INDEMNIFICATION
INDEMNIFICATION
9.1 Survival.
All of the representations and warranties contained in this Agreement shall survive the
Closing, and shall continue in full force and effect thereafter until, and expire on the second
anniversary of the Closing Date, except for:
(i) the representations and warranties of Sellers regarding the Acquired Subsidiaries set
forth in Sections 4.1(a), 4.1(c), 4.13(c) and 4.20; the representations and warranties of
Sellers set forth in Sections 5.1(a), 5.2, and 5.3; the representations of Buyers set forth
in Sections 6.1(a) and 6.3; and the indemnification obligations of Sellers’ or Buyers’, as
applicable, with respect thereto, shall survive indefinitely; and
(ii) the representations and warranties in Sections 4.8, 4.12, and 4.14 and the
indemnity obligation in Sections 8.1 and 8.5 shall terminate and expire on the
90th day after the
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date upon which the Liability to which any claim based upon, arising
out of or otherwise in respect of any breach of any such representation or warranty or indemnity
obligation may relate is barred by all applicable statutes of limitations (including all periods of
extension, whether automatic or permissive).
Notwithstanding anything in this Section 9.1 to the contrary, the foregoing
limitations shall not apply in the event of any Breach of a representation or warranty by a Party
that constitutes fraud or intentional misrepresentation. Notwithstanding any provision in this
Agreement to the contrary, all covenants and other agreements contained in this Agreement shall
survive the Closing without limitation by time, and Buyers shall be entitled to indemnification
hereunder pursuant to Section 9.2 and the Sellers shall be entitled to indemnification
hereunder pursuant to Section 9.3 until the relevant covenant, agreement or obligation is
performed in accordance with the terms thereof.
9.2 General Indemnification of Buyers.
Subject to the limitations contained in this Article IX, from and after the Closing,
the Sellers, jointly and severally, agree to indemnify, defend and hold harmless Buyers, the
Acquired Subsidiaries and their respective officers, directors, employees, Affiliates, successors
and assigns (each, a “Buyer Indemnified Party” and together, the “Buyer Indemnified
Parties”) from and against, and will pay to the Buyer Indemnified Parties the amount of, any
Damages arising, directly or indirectly, from or in connection with: (i) any Breach of any representation or
warranty made by Sellers concerning the Acquired Subsidiaries in Article IV of this
Agreement; (ii) any Breach of any representation or warranty made by Sellers in Article V
of this Agreement; (iii) any Breach by any Seller or any Acquired Subsidiary of any of their
respective covenants, agreements or obligations under this Agreement; (iv) the Retained
Liabilities; (v) any Insured Claims, but only to the extent that the aggregate amount of such
Damages exceed the Insurance Reserve (for clarification purposes, Damages for purposes of this
Section 9.2(v) shall include the payment of any insurance deductibles paid in connection
with such claims); (vi) any Damages resulting to Buyers or any Acquired Subsidiaries as a result of
any of the Buyers failing to have in its possession any of the original Fundamental Documents which
were not delivered to Buyers by Sellers at or after the Closing (vii) any Damages resulting to
Buyer or any Acquired Subsidiary as a result of Buyer or an Acquired Subsidiary not receiving an
executed Share Register Instrument which is required in order to effectively and legally execute
and deliver such Share Register Instrument.
9.3 Indemnification of Sellers.
Subject to the limitations contained in this Article IX, from and after the Closing,
the Buyers, jointly and severally, agree to indemnify, defend and hold harmless the Sellers and
their respective officers, directors, employees, Affiliates, successors and assigns (each, a
“Seller Indemnified Party” and together, the “Seller Indemnified Parties”) from and
against, and will pay to the Seller Indemnified Parties the amount of, any Damages arising,
directly or indirectly, from or in connection with: (i) any Breach of any representation or
warranty made by Buyers in Article VI of this Agreement; (ii) any Breach by any Buyer of
any of their respective covenants, agreements or obligations under this Agreement; (iii) any
Damages incurred by a Seller Indemnified Party under the Parent Company Guarantee, except to the
extent that such Damages
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arise from events occurring prior to the Effective Time or are otherwise
caused by the Sellers’ actions, including the Sellers’ occupancy of a portion of the premises
subject to the Northbelt Lease Agreement; (iv) any Damages incurred by a Seller Indemnified Party
with respect to the Existing Bonds as a result of action or inaction occurring from or after the
Effective Time; (v) any Damages incurred by a Seller Indemnified Party with respect to the matter
set forth on Section 4.12(a) of the Disclosure Schedule and defined thereon as the “Buyer Special
Indemnity Matter”, and (vi) any Damages incurred by the Seller Indemnified Parties as a result of
Buyers’ or its Affiliates’ obligation to reimburse any of the Seller Indemnified Parties for any
worker’s compensation claims included within the Insurance Reserve.
9.4 Special Indemnification Provisions.
Notwithstanding any other provision in this Agreement to the contrary, from and after the
Closing, Sellers, jointly and severally, agree to indemnify, defend and hold harmless each Buyer
Indemnified Party from and against, and will pay to the Buyer Indemnified Parties the amount of,
any Damages (including but not limited to any and all punitive damages and civil and criminal
penalties) arising, directly or indirectly, from or in connection with:
(a) any Breach of the representations and warranties contained in Section 4.13(c) or any
actual or alleged violation of the FCPA or any other anti-corruption Law by any Acquired Subsidiary
(or by any director, officer, employee, agent or representative of an Acquired Subsidiary, or any
representative or agent of any of the foregoing, in his or her capacity as such) on or before the
Closing Date (collectively, the “FCPA Violations”);
(b) any claim for indemnification in respect of any act, event or occurrence, in each case
occurring prior to the Closing, that would have been covered by an indemnification provision
contained or referred to in any Contract entered into by any Acquired Subsidiary prior to Closing
but for the operation of any Anti-Indemnity Law, but only to the extent that a claim exceeds the
$1,000,000 self insured retention per claim, as reserves for claims for amounts below this
retention are subject to indemnification pursuant to Section 9.2(v); and
(c) any claim for breach of contract in respect of any failure or alleged failure by any of
the Acquired Subsidiaries to provide insurance coverage in accordance with its obligations under
any Contract entered into by any Acquired Subsidiary prior to Closing (whether or not such
obligations to provide insurance coverage are rendered void or unenforceable by virtue of any
Anti-Indemnity Law) (these claims along with the claims described in subsection (b) above are
collectively referred to herein as the “Anti-Indemnity Claims”).
9.5 Time Limitations.
(a) Except as otherwise provided in Section 9.5(b) and Section 9.5(c), Sellers
will have no liability (for indemnification or otherwise) with respect to a Breach of any
representation or warranty unless a Buyer Indemnified Party delivers a Claim Notice (as defined in
Section 9.7 below) to Sellers within the applicable survival period as set forth in
Section 9.1.
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(b) Sellers will have no liability (for indemnification or otherwise) with respect to any
Insured Claim unless a Buyer Indemnified Party delivers a Claim Notice to Sellers prior to the
seventh (7th) anniversary of the Closing Date.
(c) Sellers will have no liability (for indemnification or otherwise) with respect to any
Anti-Indemnity Claims unless a Buyer Indemnified Party delivers a Claim Notice to Sellers prior to
the 90th day after the date upon which such claim is barred by all applicable statutes
of limitations (including all periods of extension, whether automatic or permissive).
(d) Sellers’ obligation to indemnify the Buyers with respect to FCPA Violations shall survive
indefinitely.
(e) Buyers will have no liability (for indemnification or otherwise) with respect to a Breach
of any representation or warranty unless a Seller Indemnified Party delivers a Claim Notice to
Buyers within the applicable survival period as set forth in Section 9.1.
(f) Buyers obligation xxxxxx Section 7.2(k) shall survive indefinitely.
9.6 Limitations on Amount.
(a) Sellers will have no liability for any indemnification obligation under Section 9.2
of this Agreement until the Damages with respect to each such matters suffered or incurred by
the Buyer Indemnified Parties and for which the Buyer Indemnified Parties are entitled to
indemnification thereof under Sections 9.2(i) and (ii) exceeds $10,000 for each claim (the
“Threshold”), after which, subject to Sections 9.6(b) and 9.6(c), the Sellers shall
be obligated to pay in full all such amounts for such indemnification (including those amounts not
exceeding the Threshold).
(b) Sellers will have no liability for any indemnification obligation under Section 9.2
of this Agreement until the total of all Damages with respect to such matters suffered or
incurred by the Buyer Indemnified Parties and for which the Buyer Indemnified Parties are entitled
to indemnification thereof under Sections 9.2(i) and (ii) exceeds $450,000 in the aggregate
(the “Basket”), after which the Sellers shall be obligated to pay in full all such amounts
for such indemnification (including those amounts not exceeding the Basket), provided, however,
that the Basket shall not apply to any claim based on fraud or intentional misrepresentation, any
claim for indemnification relating to FCPA Violations, Anti-Indemnity Claims or Insured Claims, or
for a Breach of a Fundamental Representation (collectively, the “Excluded Claims”),
although all Damages with respect to such Excluded Claims shall be included in determining whether
the Basket has been met. For purposes of this Article IX, the term “Fundamental
Representation” means all representations and warranties contained in Sections 4.1(a),
4.1(c), 4.20 and 5.1(a), 5.2, and 5.3.
(c) Other than indemnification in connection with any Excluded Claim, the maximum amount of
Sellers’ liability for any indemnification obligation under Sections 9.2(i) and (ii) of
this Agreement shall not exceed in the aggregate an amount equal to $11,700,000 (the
“Cap”). No amounts paid by Sellers for Excluded Claims shall be included in determining
whether the Cap has been met.
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(d) Buyers will have no liability for any indemnification obligation under Section
9.3(i) of this Agreement until the total of all Damages with respect to such matters exceeds
the Basket, after which the Buyers shall be obligated to pay in full all such amounts for such
indemnification (including those amounts not exceeding the Basket). The maximum amount of Buyers’
liability for any indemnification obligation under Sections 9.3(i) of this Agreement shall
not exceed in the aggregate an amount equal to the Cap.
9.7 Procedures for Making Claims.
The Party making a claim under this Article IX is referred to as the “Indemnified
Party” and the Party against whom such claims are asserted under this Article IX is
referred to as the “Indemnifying Party.” All claims by any Indemnified Party under this
Article IX shall be asserted and resolved as follows:
(a) Notice of Asserted Liability. Within 5 Business Days after receipt by the
Indemnified Party of notice of the commencement of any action or proceeding, the assertion of
any claim by a third party, the imposition of any penalty or assessment or a claim not
involving a third party for which the Indemnified Party seeks to be indemnified that may result in
Damages (each, an “Asserted Liability”), the Indemnified Party shall give written notice of
such Asserted Liability (the “Claims Notice”) to the Indemnifying Party. The failure to
give such prompt written notice shall not, however, relieve the Indemnifying Party of its
indemnification obligations, except and only to the extent that the Indemnifying Party is
materially and irreparably prejudiced by reason of such failure. To the extent then known by the
Indemnified Party, the Claims Notice shall describe the Asserted Liability in reasonable detail,
including (i) the representation, warranty, covenant or agreement that is alleged to have been
Breached, (ii) the basis for such allegation, including the provision of supporting documentation,
and (iii) if known, the aggregate amount of the Damages for which a claim is being made under this
Article IX. The Indemnified Party will consult with the Indemnifying Party with respect to
any possible mitigation, action or defense to the matter giving rise to any claim or potential
claim against the Indemnifying Party, or any possible right of recovery against a third party in
respect of such matter.
(b) Non-Third Party Claims. If the Claims Notice from the Indemnified Party pertains
to an Asserted Liability other than a claim or demand from a third party, then the Indemnifying
Party shall have 20 Business Days following receipt of the Claims Notice to make such
investigation, at the expense of the Indemnifying Party, of the basis of the claim and the amount
of the Asserted Liability, as the Indemnifying Party deems necessary or desirable. For the
purposes of such investigation, the Indemnified Party will make available to the Indemnifying Party
the information relied upon by the Indemnified Party to substantiate the Asserted Liability and
such other information in its possession that the Indemnifying Party may reasonably request for
purposes of such investigation. If the Indemnified Party and the Indemnifying Party agree at or
prior to the expiration of said 20 Business Day period (or any mutually agreed upon extension
thereof) on the validity and amount of such Asserted Liability, the Indemnifying Party shall
promptly pay to the Indemnified Party the full amount of the claim by wire transfer of immediately
available funds to an account designated by the Indemnified Party. If the Indemnified Party and
the Indemnifying Party do not agree at or prior to the expiration of said 20 Business Day period
(as such period may be extended by mutual
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agreement) on the validity and amount of such Asserted
Liability, then each of the Indemnified Party or the Indemnifying Party may pursue the remedies
available to them under this Agreement.
(c) Opportunity to Defend Third Party Claims.
(i) If the Claims Notice pertains to an Asserted Liability that relates to a claim or demand
from a third party (a “Third Party Claim”), the Indemnifying Party may elect to compromise
or defend, at its own expense and by its own counsel, such Asserted Liability so long as (A) the
Indemnifying Party shall acknowledge in writing its obligation to indemnify the Indemnified Party
for any and all Damages relating thereto (subject to the limitations set forth in this Agreement),
(B) the claim or demand does not seek to impose on the Indemnified Party any injunctive or other
non-monetary relief, (C) the Third Party Claim does not involve any customer of the Indemnified
Party from which such Indemnified Party receives five percent (5%) or more of its revenues, or any
officer or key employee of the Indemnified Party, and (D) it is reasonably expected that the
indemnification payments to be made by the Indemnifying Party in respect of
such Third Party Claim, giving effect to the application of the Cap and the Basket, will be at
least equal to the Damages suffered by the Indemnified Party as a result of such Third Party Claim.
(ii) If the Indemnifying Party elects to compromise or defend such Asserted Liability, it
shall promptly notify the Indemnified Party in writing of its intent to do so (but in no event
later than within ten (10) Business Days of the date of the notice of the claim concerning the
commencement or assertion of any such Third Party Claim), and the Indemnified Party, at the expense
of the Indemnifying Party, shall cooperate in the compromise of, or defense against, such Asserted
Liability. If the Indemnifying Party elects to defend against such Third Party Claim or Asserted
Liability, the following shall apply: (A) the Indemnified Party shall make available to the
Indemnifying Party any personnel, books, records or other documents within its control that are
necessary or appropriate for such defense, (B) the Indemnifying Party will defend the Indemnified
Party against the matter with counsel compensated by and chosen by the Indemnifying Party, subject
to the Indemnified Party’s reasonable prior approval of such counsel; (C) the Indemnified Party may
retain separate co-counsel at the sole cost and expense of Indemnified Party, provided, however,
that if in the reasonable opinion of the Indemnified Party, (i) there are legal defenses available
to an Indemnified Party that are different from or additional to those available to the
Indemnifying Party or (ii) there exists a conflict of interest between the Indemnifying Party and
the Indemnified Party that cannot be waived, the Indemnifying Party shall be liable for the
reasonable legal fees and expenses of one separate counsel to all of the applicable Indemnified
Parties (in addition to one local counsel in each jurisdiction that may be necessary or
appropriate); (D) the Indemnifying Party will not consent to the entry of any judgment with respect
to the matter, or enter into any settlement, without the written consent of the Indemnified Party,
which consent will not be unreasonably withheld, delayed or conditioned, (E) in assuming the
defense of any Third Party Claim, the Indemnifying Party must expressly waive the right to contest
whether any or all of such claim is indemnifiable hereunder.
(iii) If the Indemnifying Party is precluded from compromising or defending an Asserted
Liability under Section 9.7(c)(i), elects not to compromise or defend such Asserted
Liability, fails to notify the Indemnified Party in writing of its election within the time period
provided in this Agreement, or otherwise abandons the defense of such Asserted Liability, the
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Indemnified Party (i) shall pursue in good faith the defense of such Asserted Liability and (ii)
may pay, compromise or defend such Asserted Liability and seek indemnification for any and all
Damages based upon, arising from or relating to such Asserted Liability pursuant to this
Article IX. Notwithstanding the foregoing, neither the Indemnifying Party nor the
Indemnified Party shall settle or compromise any Asserted Liability without the prior written
consent of the other (which consent shall not be unreasonably withheld, conditioned or delayed).
9.8 Other Matters Relating to Indemnification.
(a) Damages Paid Net of Other Recoveries.
(i) Indemnification under this Article IX shall be limited to the amount of any
Damages that remains after deducting therefrom (and the cumulative amount of all Damages for
purposes of determining the Basket shall be reduced by the amount of) any insurance proceeds or any
indemnity, contribution or other similar payment actually recovered (net of out-of-pocket
costs incurred in connection with such recovery) by an Indemnified Party from any third party
insurer that is not an Affiliate of such Indemnified Party, provided, however, that no Indemnified
Party shall have any obligation to seek to recover insurance proceeds or any other amounts from
third parties in connection with making an indemnification claim under this Article IX.
(ii) In any case where an Indemnified Party recovers from third parties all or any part of any
amount paid to it by an Indemnifying Party pursuant to this Article IX, such Indemnified
Party shall promptly pay over to the Indemnifying Party the amount so recovered (after deducting
therefrom a reasonable amount of the expenses incurred by it in procuring such recovery), but not
in excess of any amount previously so paid by the Indemnifying Party.
(b) Adjustment to Purchase Price. All indemnification payments under this Article
IX and under Article VIII and under Section 7.2(j) shall be deemed and treated
by the Parties as adjustments to the Purchase Price.
9.9 Exclusive Remedy.
Except for (i) any case of fraud or intentional misrepresentation, (ii) any claim with respect
to Section 10.1 (in which case the sole remedy shall be specific performance) and (iii) the
remedies referenced in the Purchase Price adjustment provisions contained in Section 2.4,
and (iv) the provisions of Article VIII, the indemnification pursuant to this Article
IX shall be the sole and exclusive remedy of Buyers for all Damages based upon, arising from or
relating to any Breach of any representation, warranty or covenant contained in this Agreement.
9.10 Special Limitation on Claims.
Notwithstanding any other provision in this Agreement to the contrary Buyers shall have no
recourse against Sellers for any Claims relating to the Contemplated Transactions as a result of
any violation of Section 55102 of Title 46 of the United States Code that occur from and after the
Closing by virtue of Buyers chartering of the Owned Vessels under the Charter Agreement and
operating of the (i) Owned Vessels under the Secondment Agreement and the Customer Owned Vessels.
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ARTICLE X
TERMINATION
TERMINATION
10.1 Termination of Agreement.
(a) Termination by Lapse of Time. Either Party may terminate this Agreement if the
Closing has not been consummated on or before September 30, 2009, or such later date as the Parties
may agree upon; provided that the Party seeking termination is not then in breach of any of its
material obligations under this Agreement.
(b) Termination by Agreement of the Parties. This Agreement may be terminated by the
mutual written agreement of Buyers and the Sellers.
(c) Termination by Buyers for Breach. This Agreement may be terminated by Buyers if
at any time prior to the Closing there shall occur a breach of any of the representations,
warranties or covenants of the Sellers or the failure of the Sellers to perform any condition or
obligation hereunder, except for any such breaches or failures that would not reasonably be
expected to have a Material Adverse Effect.
(d) Termination by Sellers for Breach. This Agreement may be terminated by the
Sellers if at any time prior to the Closing there shall occur a material breach of any of the
representations, warranties or covenants of Buyers or the failure by Buyers to perform any material
condition or obligation hereunder.
10.2 Availability of Remedies at Law; Survival of Certain Obligations.
Each Party hereto shall have the right to enforce its rights hereunder and the obligations of
the other Parties hereunder by an action or actions for specific performance, injunctive and/or
other equitable relief, in addition to any other remedy at law or equity. Each Party’s right of
termination under Section 10.1 is in addition to any other rights it may have under this
Agreement or otherwise, and the exercise of such right of termination will not be deemed an
election of remedies. If this Agreement is terminated pursuant to Section 10.1, all
further obligations of the Parties under this Agreement shall terminate, except that the
obligations in Section 11.2 shall survive; provided, that if this Agreement is terminated
by a Party because of the breach of this Agreement by another Party or because one or more of the
conditions to the terminating Party’s obligations under this Agreement is not satisfied as a result
of another Party’s failure to comply with its obligations under this Agreement, then the
terminating Party’s right to pursue an action or actions for specific performance, injunctive
and/or other equitable relief, in addition to any other remedy at law or equity, shall survive such
termination unimpaired. Nothing herein or any termination of this Agreement shall limit the right
of the non-breaching Party to enforce its rights hereunder and the obligations of the other Parties
hereunder by an action or actions for specific performance, injunctive and/or other equitable
relief, in addition to any other remedy at law or equity. A Party’s right to terminate this
Agreement is in addition to, and not in lieu of, any other legal or equitable rights or remedies
which such Party may have.
73
ARTICLE XI
MISCELLANEOUS
MISCELLANEOUS
11.1 Interpretive Provisions; Certain Definitions.
(a) Whenever used in this Agreement, “to the Sellers’ Knowledge” shall mean the actual
knowledge of each of H. Xxxxx XxXxxxxx, Xxxxxxx X. Xxxxx, Xxxx X. Xxxxxxxxx, Xxxxxxx X. Xxxxx,
Xxxxx Xxxx, Xxxxxx Xxxxxxx and Xxxxx Xxxxxxx.
(b) The Parties have jointly participated in the negotiation and drafting of this Agreement.
In the event of an ambiguity or question of intent or interpretation arises, this Agreement shall
be construed as if drafted jointly by the Parties and no presumptions or burdens of proof shall
arise favoring any Party by virtue of the authorship of any of the provisions of this
Agreement. Any reference to any United States, state, local, or other foreign statute or law
shall be deemed also to refer to all rules and regulations promulgated thereunder, unless the
context requires otherwise. Each defined term used in this Agreement has a comparable meaning when
used in its plural or singular form. Each gender-specific term used herein has a comparable
meaning whether used in a masculine, feminine or gender-neutral form. As used in this Agreement,
the word “including” and its derivatives means “without limitation” and its derivatives, the word
“or” is not exclusive and the words “herein,” “hereof,” “hereby,” “hereto” and “hereunder” refer to
this Agreement as a whole. The Section headings contained in this Agreement are inserted for
convenience or reference only and shall not affect in any way the meaning or interpretation of this
Agreement. Reference in this Agreement to any legal term for any Law, action, remedy, method of
judicial proceeding, legal document, legal status, court, official or any other legal concept or
thing shall in respect of any jurisdiction other than the United States be deemed to include that
legal concept or thing in that other jurisdiction which most nearly approximates that United States
legal term (in addition to any other analogous legal concept or term specified). The Appendices,
Schedules and Exhibits identified in this Agreement are incorporated herein by reference and made a
part hereof. Any capitalized terms used in any Appendix, Schedule or Exhibit attached hereto and
not otherwise defined therein shall have the meanings set forth in this Agreement. Reference to
any Person includes such Person’s successors and assigns but, if applicable, only if such
successors and assigns are not prohibited by this Agreement, and reference to a Person in a
particular capacity excludes such Person in any other capacity or individually.
11.2 Expenses.
Except as otherwise explicitly provided in this Agreement, each Party will bear its own
expenses incurred in connection with the negotiation, preparation and execution of this Agreement
and the transactions contemplated hereby, whether or not such transactions are consummated.
11.3 Entire Agreement; Amendments and Waivers; Conflicts.
(a) This Agreement, the other Transaction Documents and the Appendices, Schedules and Exhibits
attached hereto and thereto, along with the NDA, contain the entire agreement among the parties
with respect to the transactions contemplated hereby and supersede all prior agreements and
understandings among the parties with respect thereto.
74
(b) This Agreement shall not be altered or otherwise amended except pursuant to an instrument
in writing signed by each Seller and each Buyer. At any time prior to the Closing Date, the
Parties may, to the extent legally allowed, (a) extend the time for the performance of any of the
obligations or other acts of the other Parties, (b) waive any inaccuracies in the representations
and warranties of the other Parties contained herein or in any document delivered pursuant hereto
and/or (c) waive compliance with any of the agreements or conditions contained herein. Any
agreement on the part of a Party hereto to any such extension or waiver shall be valid only if set
forth in a written instrument signed on behalf of such Party. The failure of any Party to assert
any of its rights under this Agreement or otherwise shall not constitute a waiver of such rights.
(c) No waiver by any Party of any default, misrepresentation or Breach of warranty or covenant
hereunder, whether intentional or not, shall be deemed to extend to any prior or subsequent
default, misrepresentation or breach of warranty or covenant hereunder or affect in any way any
rights arising by virtue of any prior or subsequent occurrence of such kind.
(d) To the extent that any provision of this Agreement conflicts with the provisions of any
Appendix, Schedule or Exhibit or other document related to this Agreement, the provisions of this
Agreement shall apply.
11.4 Severability.
It is the desire and intent of the Parties that the provisions of this Agreement be enforced
to the fullest extent permissible under the Laws and public policies applied in each jurisdiction
in which enforcement is sought. Accordingly, if any particular provision of this Agreement shall
be adjudicated by a court of competent jurisdiction to be invalid, prohibited or unenforceable for
any reason, such provision, as to such jurisdiction, shall be ineffective, without invalidating the
remaining provisions of this Agreement or affecting the validity or enforceability of this
Agreement or affecting the validity or enforceability of such provision in any other jurisdiction.
Notwithstanding the foregoing, if such provision could be more narrowly drawn so as not to be
invalid, prohibited or unenforceable in such jurisdiction, it shall, as to such jurisdiction, be so
narrowly drawn, without invalidating the remaining provisions of this Agreement or affecting the
validity or enforceability of such provision in any other jurisdiction.
11.5 Notices.
All notices or other communications which are required hereunder or otherwise delivered in
connection herewith shall be in writing and shall be deemed to have been duly given if delivered
personally or if sent by nationally-recognized overnight courier, by facsimile or electronic mail,
or by registered or certified mail, postage prepaid, return receipt requested, addressed as
follows:
if to Buyers, to:
c/o Wood Group E.&P.F Holdings, Inc.
00000 Xxxx Xxxxxxx, Xxxxx 000
Xxxxxxx, Xxxxx 00000
00000 Xxxx Xxxxxxx, Xxxxx 000
Xxxxxxx, Xxxxx 00000
75
Attention: President
Facsimile: (000) 000-0000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Telephone: (000) 000-0000
with a copy to:
Wood Group Management Services, Inc.
00000 Xxxx Xxxxxxx, Xxxxx 000
Xxxxxxx, Xxxxx 00000
00000 Xxxx Xxxxxxx, Xxxxx 000
Xxxxxxx, Xxxxx 00000
Attention: General Counsel — Americas
Facsimile: (000) 000-0000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Telephone: (000) 000-0000
if to the Sellers, to:
Xxxxxxx Xxxxx Corporation
Airside Business Park
000 Xxxxxxx Xxxxx
Xxxx Xxxxxxxx, XX 00000
Airside Business Park
000 Xxxxxxx Xxxxx
Xxxx Xxxxxxxx, XX 00000
Attention: H. Xxxxx XxXxxxxx, Esq.
Facsimile: (000) 000-0000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Telephone: (000) 000-0000
with a copy to:
Xxxx Xxxxx LLP
000 Xxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxxxxxx 00000
Attention: Xxxxx X. XxXxxxx
Facsimile: (000) 000-0000
000 Xxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxxxxxx 00000
Attention: Xxxxx X. XxXxxxx
Facsimile: (000) 000-0000
or to such other address as any Party to whom notice is to be given may have furnished to the other
Parties in writing in accordance herewith. Any such notice or communication shall be deemed to
have been received (a) in the case of personal delivery, on the date of delivery, (b) in the case
of a nationally-recognized overnight courier, charges prepaid, the next day after being sent, (c)
in the case of facsimile transmission or electronic mail transmission, when confirmation of
delivery is received, and (d) in the case of mailing, on the third (3rd) Business Day
after it is sent by registered or certified mail, return receipt requested, postage prepaid.
11.6 Counterparts.
This Agreement may be executed in any number of counterparts, and each such counterpart shall
be deemed to be an original instrument, but all such counterparts together shall constitute one and
the same agreement. It is the express intent of the Parties to be bound by the exchange of
signatures of this Agreement via electronic transmission (including facsimile and electronic pdf),
which the Parties agree shall constitute a writing for legal purposes.
76
11.7 Governing Law; Waiver of Trial by Jury.
(a) EXCEPT TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION IS
MANDATORY, THIS AGREEMENT WILL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE DOMESTIC LAWS OF
THE STATE OF DELAWARE, WITHOUT GIVING EFFECT TO ANY CHOICE OF LAW OR CONFLICTING PROVISION OR RULE
(WHETHER OF THE STATE OF DELAWARE OR ANY OTHER JURISDICTION) THAT WOULD CAUSE THE LAWS OF ANY
JURISDICTION OTHER THAN THE STATE OF DELAWARE TO BE APPLIED. IN FURTHERANCE OF THE FOREGOING, THE
INTERNAL LAWS OF THE STATE OF
DELAWARE WILL CONTROL THE INTERPRETATION AND CONSTRUCTION OF THIS AGREEMENT, EVEN IF UNDER
SUCH JURISDICTION’S CHOICE OF LAW OR CONFLICT OF LAW ANALYSIS, THE SUBSTANTIVE LAW OF SOME OTHER
JURISDICTION WOULD ORDINARILY APPLY.
(b) EACH PARTY HERETO HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES, TO THE FULLEST EXTENT IT
MAY LEGALLY AND EFFECTIVELY DO SO, TRIAL BY JURY IN ANY SUIT, ACTION OR PROCEEDING BASED HEREON,
ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT OR THE OTHER AGREEMENTS OR ANY COURSE OF
CONDUCT, COURSE OF DEALINGS, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF THE PARTIES
HERETO IN CONNECTION HEREWITH.
11.8 Consent to Jurisdiction and Service of Process.
(a) EACH OF THE PARTIES HEREBY:
(i) IRREVOCABLY SUBMITS TO THE JURISDICTION OF THE STATE OR FEDERAL COURTS LOCATED IN
NEW YORK FOR THE PURPOSES OF ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS
AGREEMENT OR THE OTHER DOCUMENTS OR THE SUBJECT MATTER HEREOF OR THEREOF AND BROUGHT BY ANY
OTHER PARTY;
(ii) WAIVES AND AGREES NOT TO ASSERT, BY WAY OF MOTION, AS A DEFENSE OR OTHERWISE, IN
ANY SUCH ACTION OR PROCEEDING, ANY CLAIM THAT (A) IT IS NOT PERSONALLY SUBJECT TO THE
JURISDICTION OF SUCH COURTS, (B) THE ACTION OR PROCEEDING IS BROUGHT IN AN INCONVENIENT
FORUM OR (C) THE VENUE OF THE ACTION OR PROCEEDING IS IMPROPER; AND
(iii) AGREES THAT, NOTWITHSTANDING ANY RIGHT OR PRIVILEGE IT MAY POSSESS AT ANY TIME,
SUCH PARTY AND ITS PROPERTY ARE AND SHALL BE GENERALLY SUBJECT TO SUIT ON ACCOUNT OF THE
OBLIGATIONS ASSUMED BY IT HEREUNDER.
(b) EACH PARTY AGREES THAT SERVICE IN PERSON OR BY CERTIFIED OR REGISTERED MAIL TO ITS ADDRESS
SET FORTH IN SECTION 11.5 SHALL CONSTITUTE VALID IN PERSONAM SERVICE UPON SUCH PARTY AND
ITS
77
SUCCESSORS AND ASSIGNS IN ANY ACTION OR PROCEEDING WITH RESPECT TO ANY MATTER AS TO WHICH IT
HAS SUBMITTED TO JURISDICTION HEREUNDER AND THAT SUCH PROCESS MAY BE SERVED ON ANY PARTY ANYWHERE
IN THE WORLD.
(c) EACH PARTY HEREBY ACKNOWLEDGES THAT THIS IS A COMMERCIAL TRANSACTION, THAT THE FOREGOING
PROVISIONS FOR CONSENT TO JURISDICTION AND SERVICE OF PROCESS HAVE BEEN READ, UNDERSTOOD
AND VOLUNTARILY AGREED TO BY EACH PARTY AND THAT BY AGREEING TO SUCH PROVISIONS EACH PARTY IS
WAIVING IMPORTANT LEGAL RIGHTS.
11.9 Benefits of Agreement.
All of the terms and provisions of this Agreement shall be binding upon and inure to the
benefit of the Parties hereto and their respective successors and permitted assigns. Anything
contained herein to the contrary notwithstanding, this Agreement shall not be assignable by the
Sellers without the consent of Buyers or by Buyers without the consent of the Sellers.
11.10 Non Disclosure Agreement.
The rights, obligations and restrictions of the Parties contained in the nondisclosure letter
agreement, dated as of April 28, 2009, between Xxxxx and Xxxx Group E.&P.F. Holdings, Inc. (the
“NDA”) shall continue and remain in full force and effect in accordance with the provisions
of such NDA.
11.11 Public Announcements.
No press release or announcement concerning this Agreement or the transactions contemplated
hereby will be issued by any Party without the prior consent of the other Parties, except any such
release or announcement as may be required by Law, including without limitation, the filing by
Xxxxx with the Securities Exchange Commission of a Current Report on Form 8-K that will include the
filing of this Agreement with such Form 8-K or with Xxxxx’x subsequently filed Form 10-Q, or in any
listing agreement with any national securities exchange, in which case the Party required to make
the release or announcement will, to the extent practicable, allow the other Party reasonable time
to comment on such release or announcement in advance of such issuance. On the Closing Date, the
Parties shall issue a joint press release, which shall be reasonably acceptable to Buyers and the
Sellers.
11.12 No Third Party Beneficiaries.
Except as expressly set forth herein (including, without limitation, Section 7.2(e)),
nothing in this Agreement shall confer any rights upon any Person other than the parties hereto and
there respective heirs, successors and permitted assigns.
78
11.13 Further Assurances.
From and after the date of this Agreement, upon the request of any Party, the other parties
shall execute and deliver such instruments, documents or other writings as may be reasonably
necessary to carry out and to effectuate fully the intent and purposes of this Agreement.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
79
IN WITNESS WHEREOF, each of the Parties hereto has caused this Agreement to be executed on the
day and year first written above.
BUYERS: | ||||||
WOOD GROUP E.&P.F. HOLDINGS, INC. | ||||||
By: | /s/ Xxxxxxx Xxxxxxx | |||||
Name: | Xxxxxxx Xxxxxxx | |||||
Title: | Power of Attorney | |||||
WOOD GROUP HOLDINGS (INTERNATIONAL) LIMITED |
||||||
By: | /s/ Xxxxxxx Xxxxxxx | |||||
Name: | Xxxxxxx Xxxxxxx | |||||
Title: | Power of Attorney | |||||
WOOD GROUP ENGINEERING AND OPERATIONS SUPPORT LIMITED |
||||||
By: | /s/ Xxxxxxx Xxxxxxx | |||||
Name: | Xxxxxxx Xxxxxxx | |||||
Title: | Power of Attorney | |||||
SELLERS: | ||||||
XXXXXXX XXXXX CORPORATION | ||||||
By: | /s/ Xxxxxxx X. Xxxxx | |||||
Name: | Xxxxxxx X. Xxxxx | |||||
Title: | Executive Vice President, Chief Financial Officer |
[Signature Page to Share Purchase Agreement]
XXXXX HOLDING CORPORATION | ||||||
By: | /s/ Xxxxxxx X. Xxxxx | |||||
Name: | Xxxxxxx X. Xxxxx | |||||
Title: | Executive Vice President, Chief Financial Officer |
|||||
XXXXX OTS, INC. | ||||||
By: | /s/ Xxxxxxx X. Xxxxx | |||||
Name: | Xxxxxxx X. Xxxxx | |||||
Title: | Executive Vice President, Chief Financial Officer |
|||||
XXXXXXX XXXXX INTERNATIONAL, INC. | ||||||
By: | /s/ Xxxxxxx X. Xxxxx | |||||
Name: | Xxxxxxx X. Xxxxx | |||||
Title: | Executive Vice President, Chief Financial Officer |
[Signature Page to Share Purchase Agreement]
Appendix A
Acquired Subsidiaries
1. | Xxxxxxx Xxxxx Global, Inc., a Pennsylvania corporation, 100 percent owned by Xxxxxxx Xxxxx Corporation. |
2. | Xxxxx/MO Services, Inc., a Texas corporation, 100 percent owned by Xxxxx Holding Corporation. |
3. | Energy Logistics, Inc., a Delaware corporation, 33.33 percent owned by Xxxxx/MO Services, Inc. |
4. | 5. Xxxxx Energy de Venezuela, C.A., a Venezuela entity, 99 percent owned by Xxxxxxx Xxxxx International, Inc. |
6. | Xxxxx O&M International, Ltd., a Cayman Islands entity, 100 percent owned by Xxxxx/OTS, Inc. |
7. | Xxxxx Energy International Equatorial Guinea, S.A, an Equatorial Guinean limited corporation, 65 percent owned by Xxxxx O&M International, Ltd. |
8. | Overseas Technical Services International, Ltd., a Republic of Vanuatu entity, 100 percent owned by Xxxxx/OTS, Inc. |
9. | Overseas Technical Services Nigeria Limited, a Federal Republic of Nigeria entity, 52.8 percent owned by Overseas Technical Services International, Ltd. |
10. | Xxxxx OTS International, Inc., a Cayman Islands entity, 100 percent owned by Xxxxx/OTS, Inc. |
11. | OTS Finance and Management Ltd., a Republic of Vanuatu entity, 100 percent owned by Xxxxx/OTS, Inc. |
12. | SD Forty Five Limited, a limited company incorporated in the United Kingdom and registered in England and Wales, 100 percent owned by Xxxxx/OTS, Inc. |
13. | Xxxxx OTS Limited, a limited company incorporated in the United Kingdom and registered in England and Wales, 100 percent owned by SD Forty Five Limited. |
14. | Overseas Technical Service (Harrow) Limited, a limited company incorporated in the United Kingdom and registered in England, 100 percent owned by SD Forty Five Limited. |
15. | OTS International Training Services Limited, a limited company incorporated in the United Kingdom and registered in England, 100 percent owned by SD Forty Five Limited |
Appendix B
Shares Owned by Sellers to be Transferred at Closing
1. | Xxxxxxx Xxxxx Global, Inc. — 1,000 shares of common stock, no par value per share, are authorized. 1000 shares of common stock are issued and outstanding, and will be acquired by Wood Group E.&P.F. Holdings, Inc. |
2. | Xxxxx/MO Services, Inc. — 10,000 shares of common stock, par value $1.00 per share, are authorized. 1,000 shares of common stock are issued and outstanding, and will be acquired by Wood Group E.&P.F. Holdings, Inc. |
3. | Xxxxx Energy de Venezuela, C.A. — 10,000 shares of common stock, par value 1,000 Bolivar per share, are authorized. 10,000 shares of common stock are issued and outstanding, 9,900 of will be acquired by Wood Group Holdings (International) Ltd. |
4. | Xxxxx O&M International, Ltd. — The authorized share capital is 50,000 common shares, par value $1.00 per share. 100 common shares are issued and outstanding, and will be acquired by Wood Group Holdings (International) Ltd. |
5. | Overseas Technical Services International, Ltd. — The authorized share capital is 400,000 ordinary shares of AUD1.00 each. 2,665 ordinary shares are issued and outstanding, and will be acquired by Wood Group Holdings (International) Ltd. |
6. | Xxxxx OTS International, Inc. — The authorized share capital is 900,000 ordinary shares, par value $1.00 per share. 100 ordinary shares are issued and outstanding, and will be acquired by Wood Group Holdings (International) Ltd. |
7. | OTS Finance and Management Ltd. — The authorized share capital is 400,000 ordinary shares of AUD1.00 each. 2,665 ordinary shares are issued and outstanding, and will be acquired by Wood Group Holdings (International) Ltd. |
8. | SD Forty Five Limited — The authorized share capital is 1,000 shares of £1. 1,000 shares are issued and outstanding, and will be acquired by Wood Group Engineering and Operations Support Ltd. |
Appendix C
List of Directors and Officer Resignations
Acquired Subsidiary | Officers | Directors | ||
Xxxxxxx Xxxxx Global,
Inc.
|
Xxxxxxx X. Xxxxxxx H. Xxxxx XxXxxxxx Xxxxxxx X. Xxxxx Xxx Xxxxxxx Xxxxxx X. Xxxx |
Xxxxxxx X. Xxxxxxx H. Xxxxx XxXxxxxx Xxxx Xxxxx |
||
Xxxxx/MO Services,
Inc.
|
Xxxxxxx X. Xxxxxxx H. Xxxxx XxXxxxxx Xxxxxxx X. Xxxxx Xxxxxx X. Xxxx Xxxx X. Xxxxxxxxx |
Xxxxxxx X. Xxxxxxx H. Xxxxx XxXxxxxx Xxxx X. Xxxxxxxxx |
||
Energy Logistics, Inc.
|
Xxxxxxx Xxxx | |||
BES Energy Resources
Co., Ltd. |
||||
We will not need
resignation letters
for BES at this time. |
||||
Xxxxx Energy de
Venezuela, C.A.
|
Xxxxxx X. Xxxx H. Xxxxx XxXxxxxx |
Xxxxxxx X. Xxxxxxx Xxxx X. Xxxxxxxxx H. Xxxxx XxXxxxxx Xxxx Xxxxx |
||
Xxxxx O&M International, Ltd |
Xxxxxxx X. Xxxxxxx H. Xxxxx XxXxxxxx Xxxxxxx X. Xxxxx Xxxxxx X. Xxxx |
Xxxxxxx X. Xxxxxxx H. Xxxxx XxXxxxxx |
||
Xxxxx Energy
International
Equatorial Guinea,
X.X.
|
Xxxxxxx X. Xxxxxxx | Xxxxxxx X. Xxxxxxx | ||
Overseas Technical
Services
International, Ltd.
|
Xxxxxxx X. Xxxxxxx | |||
Overseas Technical
Services Nigeria,
Ltd.
|
Xxxxxxx X. Xxxxxxx H. Xxxxx XxXxxxxx |
|||
Xxxxx OTS
International, Inc.
|
Xxxxxxx X. Xxxxxxx H. Xxxxx XxXxxxxx Xxxxxxx X. Xxxxx Xxxxxx X. Xxxx |
Xxxxxxx X. Xxxxxxx H. Xxxxx XxXxxxxx |
Acquired Subsidiary | Officers | Directors | ||
OTS Finance and
Management Ltd.
|
Xxxxxxx X. Xxxxxxx | |||
SD Forty Five Limited
|
Xxxxxxx X. Xxxxxxx H. Xxxxx XxXxxxxx |
|||
Xxxxx OTS Limited
|
Xxxxxxx X. Xxxxxxx H. Xxxxx XxXxxxxx |
|||
Overseas Technical Services (Harrow) Limited |
Xxxxxxx X. Xxxxxxx H. Xxxxx XxXxxxxx |
|||
OTS International
Training Services,
Ltd.
|
Xxxxxxx X. Xxxxxxx H. Xxxxx XxXxxxxx |
Appendix D
Acquired Subsidiaries: Corporation Information
Jurisdiction of | Jurisdictions in which | |||
Acquired Subsidiary | Incorporation or Formation | Authorized to do Business | ||
Xxxxxxx Xxxxx Global, Inc. |
Pennsylvania | |||
Xxxxx/MO Services, Inc. |
Texas | Alabama, Alaska, Arkansas, California, Colorado, Georgia, Kansas, Kentucky, Louisiana, Michigan, Mississippi, Montana, Nevada, New Jersey, New Mexico, North Dakota, Oklahoma, Oregon, Wyoming, Alberta and BC Canada | ||
Energy Logistics, Inc.1 |
Delaware | |||
BES Energy Resources Company Limited2 |
Thailand | |||
Xxxxx Energy de Venezuela,
C.A.3 |
Venezuela | |||
Xxxxx O&M International, Ltd. |
Cayman Islands | Ghana, Angola, Pakistan(inactive), Egypt (inactive) |
||
Xxxxx Energy International
Equatorial Guinea,
S.A.4 |
Equatorial Guinea | |||
Overseas Technical Services
International, Ltd. |
Republic of Vanuatu | |||
Overseas Technical Services Nigeria Limited5 |
Federal Republic of Nigeria | |||
Xxxxx OTS International, Inc. |
Cayman Islands | |||
OTS Finance and Management Ltd. |
Republic of Vanuatu | |||
SD Forty Five Limited |
United Kingdom, registered in England and Wales |
1 | 33.3% ownership interest. | |
2 | 79.7% ownership interest. | |
3 | 99% ownership interest. | |
4 | 65% ownership interest. | |
5 | 52.8% ownership interest. |
Jurisdiction of | Jurisdictions in which | |||
Acquired Subsidiary | Incorporation or Formation | Authorized to do Business | ||
Xxxxx OTS Limited
|
United Kingdom, registered in England and Wales | Algeria, Kazakhstan (inactive) |
||
Overseas Technical Services (Harrow) Limited |
United Kingdom, registered in England |
|||
OTS International Training Services Limited |
United Kingdom, registered in England |