EXHIBIT 10.1
XXXXXXXX INTERNATIONAL CORPORATION
EMPIRE STOCK CORP.
AND
THE YORK GROUP, INC.
STOCK PURCHASE AGREEMENT
Dated as of May 24, 2001
TABLE OF CONTENTS
Page
ARTICLE I. Purchase of Stock; Consideration.................................1
1.01 Stock Purchase...................................................1
1.02 Consideration....................................................2
1.03 Stock Certificates; Corporate Records............................2
ARTICLE II. Representations and Warranties of York...........................2
2.01 Organization and Authority.......................................2
2.02 Due Authorization................................................3
2.03 Capitalization; Shares...........................................3
2.04 Absence of Conflicts.............................................4
2.05 Financial Information............................................5
2.06 Absence of Material Changes......................................5
2.07 Title to Properties; Liens.......................................6
2.08 Material Contracts and Agreements................................8
2.09 Employment Agreements............................................9
2.10 Employee Benefit Plans...........................................9
2.11 Patents, Trademarks, Copyrights, Licenses and Secrecy
Agreements......................................................11
2.12 Trade Secrets...................................................13
2.13 Governmental Licenses and Permits; Consents.....................13
2.14 Indebtedness and Commitments....................................14
2.15 Taxes...........................................................14
2.16 Insurance.......................................................15
2.18 Compliance with Laws............................................15
2.19 Environmental and Occupational Safety Matters...................15
2.20 Brokers' Fees...................................................16
2.21 Contingencies...................................................16
2.22 Condition of Tangible Assets....................................16
2.23 Inventory.......................................................16
2.24 Books and Records...............................................16
2.25 Warranties......................................................17
2.26 Restrictions on Business Activities.............................17
ARTICLE III Representations and Warranties of Xxxxxxxx and Empire...........17
3.01 Organization and Authority......................................17
3.02 Due Authorization...............................................17
3.03 Absence of Conflicts............................................18
3.04 Litigation and Claims Against Xxxxxxxx and Empire...............18
3.05 Brokers' Fees...................................................18
3.06 Governmental Approvals..........................................19
3.07 Warranties......................................................19
ARTICLE IV Covenants........................................................19
4.01 Employees.......................................................19
4.02 Financial Statements............................................20
4.03 Tax Matters.....................................................20
4.04 Environmental Response..........................................20
4.05 POST-CLOSING CORPORATE GOVERNANCE OF SUBSIDIARIES...............22
4.06 USES OF NAMES...................................................23
ARTICLE V Remedies for Breaches of this Agreement...........................23
5.01 Survival of Representations, Warranties and Covenants...........23
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5.02 Indemnification Provisions for Benefit of Xxxxxxxx and Empire...24
5.03 Indemnification Provisions for Benefit of York..................25
5.04 Notice of Claim for Indemnification.............................26
5.05 Matters Involving Third Parties.................................26
5.06 EXCLUSIVE REMEDY................................................28
ARTICLE VI Definitions......................................................28
ARTICLE VII Miscellaneous...................................................33
7.01 Further Assurances..............................................33
7.02 Expenses........................................................33
7.03 Governing Law...................................................33
7.04 Entire Agreement; Modification; Waiver..........................33
7.05 Notices.........................................................33
7.06 Counterparts....................................................34
7.07 Matters of Construction, Interpretation and the Like............34
(a) Construction................................................34
(b) Severability................................................35
7.08 No Third-Party Beneficiaries....................................35
7.09 Succession and Assignment.......................................35
7.10 Time of Essence.................................................35
7.11 Noncompetition..................................................35
(a) Non-Disclosure of Confidential Information..................35
(b) Restrictions on Competition.................................35
(c) Remedies....................................................35
(d) Authorization to Modify Restrictions........................36
SCHEDULES
Schedule 2.01(b) Subsidiaries and Investments; Foreign
Jurisdictions of York Bronze
Schedule 2.01(c) Subsidiaries and Investments; Foreign
jurisdictions of OMC
Schedule 2.01(d) Subsidiaries and Investments; Foreign
Jurisdictions of Sub 1
Schedule 2.03(a) Capitalization of York Bronze
Schedule 2.03(b) Capitalization of OMC
Schedule 2.03(c) Capitalization of Sub 1
Schedule 2.04 Third Party Consents
Schedule 2.05 Financial Statements
Schedule 2.06 Changes Since December 31, 2000
Schedule 2.07(a)(i) York Bronze Real Property
Schedule 2.07(a)(ii) OMC Real Property
Schedule 2.07(a)(iii) Sub 1 Real Property
Schedule 2.07(b) Buildings and Equipment
Schedule 2.07(c) Other Assets Schedule 2.08 Contracts and
Agreements
Schedule 2.09 Employment Contracts
Schedule 2.10 Employee Benefit Plans
Schedule 2.11 Patents, Trademarks and Copyrights
Schedule 2.12 Trade Secrets
Schedule 2.14 Indebtedness and Commitments
Schedule 2.15 Taxes
Schedule 2.17 Litigation and Claims
Schedule 2.18 Compliance with Laws
Schedule 2.19 Environmental and Occupational Safety Matters
Schedule 2.21 Contingencies
ii
Schedule 4.04 Environmental Response Activities
Schedule 4.05(e) Officers of York Bronze, OMC and Sub 1 Immediately
After Closing
iii
STOCK PURCHASE AGREEMENT
THIS STOCK PURCHASE AGREEMENT ("Agreement") dated as of May 24,
2001, is entered into by and among XXXXXXXX INTERNATIONAL CORPORATION, a
Pennsylvania corporation ("Xxxxxxxx"), EMPIRE STOCK CORP., a Delaware
corporation ("Empire"), and THE YORK GROUP, INC., a Delaware corporation
("York"). Capitalized terms used in this Agreement which are not otherwise
defined herein are defined in Article VI hereof.
WITNESSETH:
WHEREAS, Empire is a wholly-owned subsidiary of Xxxxxxxx; and
WHEREAS, York is the sole shareholder of York Bronze Company, a
Delaware corporation ("York Bronze"), and of OMC Industries, Inc., a Texas
corporation ("OMC"); and
WHEREAS, York Bronze and OMC collectively own all of the issued and
outstanding shares of common stock and preferred stock of York Bronze Trade
Company, a West Virginia corporation ("Sub 1") (each of York Bronze and OMC are
referred to at times herein as a "Subsidiary" and collectively as the
"Subsidiaries," which term shall also include any of their respective
subsidiaries, including Sub 1); and
WHEREAS, on May 21, 2001, York Bronze and OMC transferred and
conveyed to Sub 1 approximately 75% of the collective assets and Sub 1 assumed
all liabilities of York Bronze and OMC (not including the Excluded Assets, as
defined herein) in exchange for all of the issued and outstanding shares of
common stock and of preferred stock of Sub 1 (the "Sub 1 Asset Transfer"); and
WHEREAS, prior to the date hereof, Empire acquired from York Bronze
and OMC all of the remaining assets of York Bronze and OMC (other than the
Excluded Assets, the Sub 1 Common Stock and the Sub 1 Preferred Stock, as
defined herein) pursuant to that certain Asset Purchase Agreement dated as of
May 24, 2001 (the "Asset Purchase Agreement") among Empire, York Bronze and OMC;
and
WHEREAS, York wishes to sell to Empire, and Empire wishes to
purchase from York, approximately 75% of the issued and outstanding shares of
the capital stock of York Bronze and of OMC upon the terms and conditions set
forth herein; and
WHEREAS, as an inducement for York to sell approximately 75% of the
capital stock of York Bronze and of OMC to Empire, Xxxxxxxx has agreed to enter
into this Agreement and to make representations, warranties, covenants,
acknowledgments and agreements set forth herein to York and for York's benefit
hereunder.
NOW THEREFORE, in consideration of the mutual covenants and
agreements contained herein and intending to be legally bound hereby, the
parties hereto covenant and agree as follows:
ARTICLE I
Purchase of Stock; Consideration
1.01 STOCK PURCHASE. In reliance upon the representations and warranties
contained herein and on the terms and conditions of this Agreement, York hereby
sells, conveys, assigns, transfers and delivers to Empire, free and clear of all
Liens, and Empire hereby purchases from York, for the consideration specified in
Section 1.02 hereof, 755.42725 shares (the "York Bronze Purchased Shares") of
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the common stock of York Bronze, par value $0.001 per share (the "York Bronze
Common Stock"), and 755.55556 shares (the "OMC Purchased Shares") of the common
stock of OMC, par value $0.10 per share (the "OMC Common Stock"). The York
Bronze Purchased Shares and the OMC Purchased Shares are collectively referred
to as the "Purchased Stock". The Purchased Stock represents 75.542725% of all of
the issued and outstanding shares of York Bronze Common Stock and 75.555556% of
all of the issued and outstanding shares of the OMC Common Stock.
1.02 CONSIDERATION. Empire hereby purchases the Purchased Stock and,
in exchange therefor, concurrently herewith delivers to York via wire transfer
in immediately available funds Thirty Two Million Seven Hundred Ten Thousand
Dollars ($32,710,000) in consideration of the York Bronze Common Stock Three
Million Four Hundred Thousand Dollars ($3,400,000) in consideration of the OMC
Common Stock (the "Purchase Price").
1.03 STOCK CERTIFICATES; CORPORATE RECORDS. York hereby delivers to
Empire certificates for the York Bronze Purchased Shares and the OMC Purchased
Shares duly issued and registered in the name of Empire or accompanied by stock
powers duly executed in blank, free and clear of all Liens. York shall also
deliver promptly after the date hereof the minute books, stock books, financial
records, customer lists and other corporate records of each of the Subsidiaries.
ARTICLE II
Representations and Warranties of York
York represents and warrants to Empire and to Xxxxxxxx that the
statements contained in this Article II are correct and complete as of the date
of the Sub 1 Asset Transfer, the date of the closing of the transactions
contemplated by the Asset Purchase Agreement and also immediately prior to the
execution and effectiveness of this Agreement, except (i) as contemplated by the
Asset Purchase Agreement or any documents, disclosure schedules or transactions
related thereto or contemplated thereby, (ii) as may result from or may be
contemplated by the Sub 1 Asset Transfer or the Liquidation (as defined below)
of York Bronze or OMC, and (iii) that each of the representations, warranties
and statements in this Article II are qualified in their entirety by the
Disclosure Schedules and the information set forth or referred to therein.
Notwithstanding anything to the contrary in this Agreement, York makes no
representations nor any warranties respecting the completeness, legality,
effects or consequences of the Sub 1 Asset Transfer or the Liquidation of York
Bronze and OMC.
2.01 ORGANIZATION AND AUTHORITY. (a) York is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Delaware. York has full corporate power and authority to own and lease the
property and assets it now owns and leases and to carry on its business as and
where such property and assets are now owned or leased and such business is now
conducted. The copies of the certificate of incorporation and bylaws of York,
which have previously been delivered to Empire and/or to Xxxxxxxx, are complete
and correct and in either case have not been amended since March 31, 2001. York
has the corporate power and authority to execute and deliver this Agreement and
to perform its obligations hereunder. There are no dissolution, liquidation or
bankruptcy proceedings pending, contemplated by or, to York's knowledge,
threatened against York.
(b) York Bronze is a corporation duly organized, validly existing
and in good standing under the laws of the State of Delaware. York Bronze (i)
has full corporate power and authority to own and lease the property and assets
it now owns and leases and to carry on its business as and where such property
and assets are now owned or leased and such business is now conducted and (ii)
except as set forth on Schedule 2.01(b), has not owned and does not now own
directly or indirectly any debt or equity securities issued by any other
corporation, or any interest in any partnership, joint venture or other business
enterprise. Schedule 2.01(b) sets forth a true and complete list of each
jurisdiction in which York Bronze is qualified to do business as a foreign
corporation. The copies of the certificate of incorporation and bylaws of York
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Bronze, which have previously been delivered to Empire and/or to Xxxxxxxx, are
complete and correct and in either case have not been amended since March 31,
2001. There are no bankruptcy proceedings pending or, to York's knowledge,
threatened against York Bronze.
(c) OMC is a corporation duly organized, validly existing and in
good standing under the laws of the State of Texas. OMC (i) has full corporate
power and authority to own and lease the property and assets it now owns and
leases and to carry on its business as and where such property and assets are
now owned or leased and such business is now conducted and (ii) except as set
forth on Schedule 2.01(c), has not owned and does not now own directly or
indirectly any debt or equity securities issued by any other corporation, or any
interest in any partnership, joint venture or other business enterprise.
Schedule 2.01(c) sets forth a true and complete list of each jurisdiction in
which OMC is qualified to do business as a foreign corporation. The copies of
the certificate of incorporation and bylaws of OMC, which have previously been
delivered to Empire and/or to Xxxxxxxx, are complete and correct and in either
case have not been amended since March 31, 2001. There are no bankruptcy
proceedings pending or, to York's knowledge, threatened against OMC.
(d) Sub 1 is a corporation duly organized and validly existing and
in good standing under the laws of the State of West Virginia. Sub 1 has full
corporate power and corporate authority to own and lease the property and assets
it now owns and leases and to carry on its business as and where such property
and assets are now owned or leased and such business is now conducted. Except as
set forth on Schedule 2.01(d), Sub 1 has not owned and does not now own directly
or indirectly any debt or equity securities issued by any other corporation, or
any interest in any partnership, joint venture or other business enterprise.
Schedule 2.01(d) sets forth a true and complete list of each jurisdiction in
which Sub 1 is qualified to do business as a foreign corporation. The copies of
the certificate of incorporation and bylaws of Sub 1 which have previously been
delivered to Empire and/or to Xxxxxxxx, are complete and correct as of the date
hereof. There are no dissolution, liquidation or bankruptcy proceedings pending,
contemplated by or, to York's, York Bronze's or OMC's knowledge, threatened
against Sub 1.
2.02 DUE AUTHORIZATION. The execution and delivery by York of this
Agreement and each of the other Transaction Documents to which it is a party,
the performance by it of all the terms and conditions hereof and thereof to be
performed by it and the consummation of the transactions contemplated hereby and
thereby, have been duly authorized and approved by all necessary corporate
proceedings on the part of York. No other corporate proceeding on the part of
York is necessary to approve and adopt this Agreement and each of the other
Transaction Documents to which it is a party and to consummate the transactions
contemplated hereby and thereby. This Agreement and each of the other
Transaction Documents to which it is a party has been duly and validly executed
and delivered by York and constitute the legal, valid and binding obligations of
York enforceable against York in accordance with their respective terms, subject
to bankruptcy, insolvency or other similar laws of general application affecting
creditors' rights and general principles of equity.
2.03 CAPITALIZATION; SHARES. (a)(i) The entire authorized capital
stock of York Bronze consists of 10,000 shares of York Bronze Common Stock, of
which 1,000 shares are issued and outstanding. Except as set forth on Schedule
2.03(a), all such outstanding shares of York Bronze Common Stock are validly
issued, fully paid, nonassessable and are owned beneficially and of record by
York, free and clear of all Liens. Except as set forth on Schedule 2.03(a), (i)
there are outstanding no securities, subscriptions, options, warrants, phantom
stock rights, calls or rights of any kind, or rights with respect to convertible
debt, issued or granted by, or binding upon, York or York Bronze with respect to
any shares of capital stock of York Bronze, and (ii) there are no shareholder
agreements or similar agreements with respect to York Bronze.
(ii) Except as set forth on Schedule 2.03(a), York has good and
indefeasible title to the
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York Bronze Purchased Shares and has the unrestricted right and power to sell
and transfer the York Bronze Purchased Shares to Empire in the manner
contemplated herein, free and clear of all Liens, and the transfer of such York
Bronze Purchased Shares by York to Empire will transfer to Empire good and valid
title to such York Bronze Purchased Shares free and clear of all Liens. The York
Bronze Purchased Shares represent 75.542725% of all issued and outstanding
capital stock of York Bronze.
(b)(i) The entire authorized capital stock of OMC consists of 75,000
shares of OMC Common Stock, of which 1,000 shares are issued and outstanding.
All such outstanding shares of OMC Common Stock are validly issued, fully paid,
nonassessable and are owned beneficially and of record by York, free and clear
of all Liens, except as set forth on Schedule 2.03(b). Except as set forth on
Schedule 2.03(b), (i) there are outstanding no securities, subscriptions,
options, warrants, phantom stock rights, calls or rights of any kind, or rights
with respect to convertible debt, issued or granted by, or binding upon, York or
OMC with respect to any shares of capital stock of OMC, and (ii) there are no
shareholder agreements or similar agreements with respect to OMC.
(ii) Except as set forth on Schedule 2.03(b), York has good and
indefeasible title to the OMC Purchased Shares and has the unrestricted right
and power to sell and transfer all of its shares of the OMC Purchased Shares to
Empire in the manner contemplated herein, free and clear of all Liens, and the
transfer of such OMC Purchased Shares by York to Empire will transfer to Empire
good and valid title to such OMC Purchased Shares free and clear of all Liens.
The OMC Purchased Shares represent 75.555556% of the issued and outstanding
capital stock of OMC.
(c)(i) The entire authorized capital stock of Sub 1 consists of
10,000,000 shares of common stock, par value $1.00 per share (the "Sub 1 Common
Stock") of which 3,000,000 shares are issued and outstanding, and 50,000,000
shares of Non-Qualified Series A Preferred Stock, par value $1.00 per share (the
"Sub 1 Preferred Stock") of which 32,900,000 shares are issued and outstanding.
The Sub 1 Common Stock and the Sub 1 Preferred Stock are herein referred to
collectively as the "Sub 1 Stock." All such outstanding shares of Sub 1 Stock
are validly issued, fully paid, nonassessable and are owned beneficially and of
record by York Bronze and by OMC, free and clear of all Liens, except as set
forth on Schedule 2.03(c). Except as set forth on Schedule 2.03(c), (i) there
are outstanding no securities, subscriptions, options, warrants, phantom stock
rights, calls or rights of any kind, or rights with respect to convertible debt,
issued or granted by, or binding upon York Bronze, OMC or Sub 1 with respect to
any shares of capital stock of Sub 1, and (ii) there are no shareholder
agreements or similar agreements with respect to Sub 1.
(ii) York Bronze and OMC have good and marketable title to the Sub 1
Stock and have the unrestricted right and power to sell and transfer all of
their shares of the Sub 1 Stock, except as set forth on Schedule 2.03 (c).
2.04 ABSENCE OF CONFLICTS. Except as a result of the Sub 1 Asset
Transfer or as set forth on Schedule 2.04, neither the execution and delivery by
York of this Agreement and each of the other Transaction Documents to which it
is a party, the compliance by York with the terms and conditions hereof and
thereof, nor the consummation by York of the transactions contemplated hereby or
thereby will:
(a) conflict with any of the terms, conditions or provisions of the
certificate of incorporation or bylaws of York or of any of the Subsidiaries,
(b) violate any provision of, or require any consent, authorization
or approval under, any law or administrative regulation or any judicial,
administrative or arbitration order, award, judgment, writ, injunction or decree
applicable to, or any Permit issued to, or notice to or filing with any
Governmental Authority with respect to York or to any of the Subsidiaries,
4
(c) to York's knowledge, violate, conflict with, result in a breach
of any provision of or the loss of any benefit under, constitute a default (or
an event which, with notice or lapse of time, or both, would constitute a
default) under, result in the termination of or a right of termination or
cancellation under, accelerate the performance required by, or result in the
creation of any Lien upon any of the properties or assets of any of the
Subsidiaries under, or require any consent, authorization or approval under, any
of the terms, conditions or provisions of any note, bond, mortgage, indenture,
Lien or other agreement, instrument for borrowed money, any guarantee of any
agreement or instrument for borrowed money or any license, lease or any other
agreement or instrument to which York or any of the Subsidiaries is a party, or
by which it or any of its properties or assets may be bound or affected,
(d) result in the creation of any Lien upon any of the properties or
assets of any of the Subsidiaries, or
(e) give to others any material rights or interests (including
rights of purchase, termination, cancellation or acceleration), under any such
indenture, mortgage, Lien, lease, agreement or instrument; except as would not
have a Material Adverse Effect.
2.05 FINANCIAL INFORMATION. York has heretofore furnished to Empire
and/or to Xxxxxxxx the financial statements and information with respect to each
of the Subsidiaries described on Schedule 2.05 (the "Financial Statements"). The
Financial Statements, in the context of their original use as part of the
financial statements of the consolidated group of which York is the parent, and
subject to such consolidated financial statements and the notes thereto as
included in York's applicable SEC filings under the Securities Exchange Act of
1934, as amended, complied as to form in all material respects with applicable
accounting requirements, were prepared in accordance with generally accepted
accounting principles ("GAAP") consistently applied during the periods involved
and fairly present:
(a) the balance sheet of York Bronze and OMC as of March 31, 2001
and as of December 31, 2000 and 1999; and
(b) the results of operations and changes in financial position of
York Bronze and OMC for the three-month period ending March
31, 2001 and for the fiscal year ended December 31, 2000, and
York Bronze for the fiscal year ended December 31, 1999.
The books and records of each of the Subsidiaries from which the Financial
Statements were prepared properly and accurately reflect the transactions and
activities which they purport to record except as would not have a Material
Adverse Effect. Except as disclosed on Schedule 2.05 or as required by GAAP,
neither York nor any of the Subsidiaries has, since March 31, 2001, made any
change in the accounting practices or policies applied in the preparation of the
Financial Statements.
2.06 ABSENCE OF MATERIAL CHANGES. Except as set forth on Schedule
2.06 or the Financial Statements, since December 31, 2000, there has not been:
(a) any Material Adverse Effect with respect to any of the
Subsidiaries, or any event, condition or state of facts which could be
reasonably expected (i) to have a Material Adverse Effect on the business,
operations, properties or assets of any of the Subsidiaries, or (ii) to impair
the ability of York to perform its obligations under this Agreement,
(b) any damage, destruction, condemnation or loss, whether covered
by insurance or not, which has had, or could reasonably be expected to have, a
Material Adverse Effect on the business, operations, properties or assets of any
of the Subsidiaries, or
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(c) any material strikes or work stoppages against the operations of
any of the Subsidiaries relating to the conduct of its business or any
injunction, order, writ or decree of any Governmental Authority against such
strikes or work stoppages.
2.07 TITLE TO PROPERTIES; LIENS.
(A) REAL PROPERTY. (i) Schedule 2.07(a)(i) identifies all interests
of York Bronze in fee, in leaseholds under leases, and in easements, licenses
and other interests in real property owned by York Bronze (the "York Bronze Real
Property"). Except for the York Bronze Real Property, no other real property is
owned by York Bronze. Schedule 2.07(a)(i) identifies, and York has heretofore
made available to Empire and/or to Xxxxxxxx true and complete copies of, all
deeds, leases or other instruments, in each case as in effect on the date hereof
(the "York Bronze Real Property Instruments"), which evidence the interests of
York Bronze in the York Bronze Real Property. Except as set forth in Schedule
2.07(a)(i), all of such deeds, leases and other instruments are in full force
and effect, and there is no default, nor any event which with notice or the
lapse of time or both could become a default, under any such deeds, leases or
other instruments, by York Bronze or any other party thereto except as would not
have a Material Adverse Effect. Except as set forth in Schedule 2.07(a)(i), York
Bronze has good title to the York Bronze Real Property, free and clear of any
and all Liens other than Permitted Liens, and no consent, waiver, approval or
authorization is required under any of the York Bronze Real Property Instruments
as a result of the execution of this Agreement or the consummation of the
transactions contemplated hereby.
(ii) Schedule 2.07(a)(ii) identifies all interests of OMC in fee, in
leaseholds under leases, and in easements, licenses and other interests in real
property owned by OMC (the "OMC Real Property"). Except for the OMC Real
Property, no other real property is owned by OMC. Schedule 2.07(a)(ii)
identifies, and York has heretofore made available to Empire and/or to Xxxxxxxx
true and complete copies of, all deeds, leases or other instruments, in each
case as in effect on the date hereof (the "OMC Real Property Instruments"),
which evidence the interests of OMC in the OMC Real Property. Except as set
forth in Schedule 2.07(a)(ii), all of such deeds, leases and other instruments
are in full force and effect, and there is no default, nor any event which with
notice or the lapse of time or both could become a default, under any such
deeds, leases or other instruments, by OMC or any other party thereto except as
would not have a Material Adverse Effect. Except as set forth in Schedule
2.07(a)(ii), OMC has good title to the OMC Real Property, free and clear of any
and all Liens other than Permitted Liens and no consent, waiver, approval or
authorization is required under any of the OMC Real Property Instruments as a
result of the execution of this Agreement or the consummation of the
transactions contemplated hereby, each except as would not have a Material
Adverse Effect.
(iii) Schedule 2.07(a)(iii) identifies all interests of Sub 1 in
fee, in leaseholds under leases, including such easements, licenses and other
interests in real property owned by Sub 1 (the "Sub 1 Real Property"). Except
for the Sub 1 Real Property, no other real property is owned by Sub 1. Schedule
2.07(a)(iii) identifies, and York has heretofore made available to Empire and/or
to Xxxxxxxx true and complete copies of, all deeds, leases or other instruments,
in each case as in effect on the date hereof (the "Sub 1 Real Property
Instruments"), which evidence the interests of Sub 1 in the Sub 1 Real Property.
Except as set forth in Schedule 2.07(a)(iii), all of such deeds, leases and
other instruments are in full force and effect, and there is no default, nor any
event which with notice or the lapse of time or both could become a default,
under any such deeds, leases or other instruments, by Sub 1 or any other party
thereto except as would not have a Material Adverse Effect. Except as set forth
in Schedule 2.07(a)(iii), Sub 1 has good title to the Sub 1 Real Property, free
and clear of any and all Liens other than Permitted Liens and no consent,
waiver, approval or authorization is required under any of the Sub 1 Real
Property Instruments as a result of the execution of this Agreement or the
consummation of the transactions contemplated hereby, each except as would not
have a Material Adverse Effect.
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(iv) Notwithstanding the foregoing provisions, representations and
warranties of this Section 2.07, interests in fee, in leaseholds under leases,
and in easements, licenses and other interests in real property that are
disclosed in this Agreement or the Disclosure Schedules as York Bronze Real
Property, OMC Real Property or Sub 1 Real Property may be titled to or held or
owned by any of the Subsidiaries.
(B) BUILDINGS AND EQUIPMENT. Schedule 2.07(b) hereto identifies
separately:
(i) all machinery and equipment owned or leased by York Bronze
as lessee having a current replacement cost in excess of $50,000 and the
location thereof (the "York Bronze Equipment"),
(ii) all machinery and equipment owned or leased by OMC as
lessee having a current replacement cost in excess of $50,000 and the location
thereof (the "OMC Equipment"),
(iii) all machinery and equipment owned or leased by Sub 1 as
lessee having a current replacement cost in excess of $50,000 and the location
thereof (the "Sub 1 Equipment'),
(iv) all leases and other instruments which evidence the
interests of York Bronze in the York Bronze Equipment and any other equipment
leases under which York Bronze is lessee and which provide for aggregate rental
payments after May 1, 2001 in excess of $50,000 (the "York Bronze Equipment
Instruments"),
(v) all leases and other instruments which evidence the
interests of OMC in the OMC Equipment and any other equipment leases under which
OMC is lessee and which provide for aggregate rental payments after May 1, 2001
in excess of $50,000 (the "OMC Equipment Instruments"),
(vi) all leases and other instruments which evidence the
interest of Sub 1 in the Sub 1 Equipment and any other equipment leases under
which Sub 1 is lessee and which provide for the aggregate rental payments after
May 1, 2001 in excess of $50,000 (the "Sub 1 Equipment Instruments"); and
(vii) any other equipment used primarily in the business of
the Subsidiaries, but not owned or leased by the Subsidiaries.
York has, to its knowledge, heretofore delivered to Empire and/or to Xxxxxxxx
true and complete copies of all York Bronze Equipment Instruments, OMC Equipment
Instruments and Sub 1 Equipment Instruments, in each case as in effect on the
date hereof. Except as set forth in Schedule 2.07(b), all such Equipment
Instruments are in full force and effect and there is no default, nor any event
which with notice or the lapse of time or both will become a default, under any
such Equipment Instruments, by York Bronze, OMC or Sub 1 (as the case may be) or
by any other party thereto except as would not have a Material Adverse Effect.
Except as set forth in Schedule 2.07(b), (A) York Bronze has good title to the
York Bronze Equipment it owns, free and clear of any and all Liens other than
Permitted Liens, and no consent, waiver, approval or authorization is required
under any of the York Bronze Equipment Instruments as a result of the execution
of this Agreement or the consummation of the transactions contemplated hereby
except as would not have a Material Adverse Effect, (B) OMC has good title to
the OMC Equipment it owns, free and clear of any and all Liens other than
Permitted Liens, and no consent, waiver, approval or authorization is required
under any of the OMC Equipment Instruments as a result of the execution of this
Agreement or the consummation of the transactions contemplated hereby except as
would not have a Material Adverse Effect and (C) Sub 1 has good title to the Sub
1 Equipment it owns, free and clear of all Liens other than Permitted Liens.
None of the buildings and plants, and none of the York Bronze Equipment, the OMC
Equipment nor
7
the Sub 1 Equipment, encroaches on the property of others, except as would not
have a Material Adverse Effect.
(C) OTHER ASSETS. Except as set forth in Schedule 2.07(c), all other
properties and assets of the Subsidiaries are owned by one or more of the
Subsidiaries, free and clear of any and all Liens other than Permitted Liens.
2.08 MATERIAL CONTRACTS AND AGREEMENTS. Schedule 2.08 identifies the
following categories of material contracts, commitments and agreements of the
Subsidiaries not otherwise identified in any other Schedule:
(a) contracts with any current officer or director of York or of any
of the Subsidiaries;
(b) contracts for the sale of any of the business, operations,
properties or assets of any of the Subsidiaries, other than in the ordinary
course of business, or for the grant to any Person of any preferential rights to
purchase any of the business, operations, properties or assets of any of the
Subsidiaries, other than inventory in the ordinary course of business;
(c) contracts containing covenants of any of the Subsidiaries not to
compete in any line of business or with any Person in any geographical area or
covenants of any other Person not to compete with any of the Subsidiaries in any
line of business or in any geographical area;
(d) all other agreements, contracts or instruments for any of the
Subsidiaries which, (i) involve purchases after the date hereof of more than
$50,000 from any one seller or group of related sellers, or (ii) involve sales
or leases after the date hereof of more than $50,000 to any one buyer or lessee
or group of related buyer or lessees,
(e) all other agreements contracts or instruments which are
contracts, commitments or agreements or involve transactions with any Affiliate
or subsidiary of York other than any of the Subsidiaries, or
(f) all agreements, contracts, commitments or instruments otherwise
material to the business, operations, properties or assets of any of the
Subsidiaries.
The contracts, commitments and agreements listed on Schedule 2.08 are
hereinafter called the "Contracts." York has heretofore made available to Empire
and/or to Xxxxxxxx true and complete copies of all Contracts as in effect on the
date hereof. Except as set forth in Schedule 2.08 or except as would not have a
Material Adverse Effect, all Contracts are in full force and effect (other than
those which have been duly performed), and are the legal, valid and binding
obligations of the respective Subsidiary, enforceable against such Subsidiary in
accordance with their respective terms. Except as set forth on Schedule 2.08,
there is no default, nor any event which with notice or the lapse of time or
both will become a default, under any of the Contracts, by the respective
Subsidiary or any other party thereto, and no consent, waiver, approval or
authorization is required under any of the Contracts as a result of the
execution of this Agreement or the consummation of the transactions contemplated
hereby except as would not have a Material Adverse Effect.
2.09 EMPLOYMENT AGREEMENTS. Schedule 2.09 identifies:
(a) each management or employment contract or contract for personal
services with any officer, consultant, salesman or other non-union employee or
agent of any of the Subsidiaries which is not by its terms terminable at will or
on less than 30 days' notice without penalty,
8
(b) each officer, consultant, salesman or other non-union employee
or agent of any of the Subsidiaries receiving as at the date hereof compensation
(including bonuses and commissions, if any) at an annual rate of $60,000 or
more, specifying the rate of such compensation (including such bonuses and
commissions) and the positions held by such persons, and
(c) each collective bargaining agreement or other agreement covering
unionized or hourly employees to which any of the Subsidiaries is a party or
which covers employees of any of the Subsidiaries.
The contracts and agreements identified on Schedule 2.09 are hereinafter called
the "Employment Contracts." York has heretofore made available to Empire and/or
to Xxxxxxxx true and complete copies of each of the Employment Contracts as in
effect on the date hereof. Except as set forth in Schedule 2.09, all Contracts
are in full force and effect (other than those which have been duly performed),
and are the legal, valid and binding obligations of the respective Subsidiary,
enforceable against such Subsidiary in accordance with their respective terms.
Except as listed on Schedule 2.09, there are no material disputes presently
subject to any grievance procedure, arbitration or litigation under the
Employment Contracts nor is there any material default, or any event which with
notice or the lapse of time or both will become a material default, under the
Employment Contracts, by the respective Subsidiary or, to the knowledge of York,
by any other party thereto. Other than as listed on Schedule 2.09, none of the
Subsidiaries is a party to any oral or written agreement or plan, including any
employment agreement, severance agreement, retention agreement, stock option
plan, stock appreciation rights plan, restricted stock plan or stock purchase
plan, any of the benefits of which will be increased, the vesting of the
benefits of which will be accelerated, or which will become payable or which at
the participant's or holder's option may become payable, due to or by the
occurrence of any of the transactions contemplated by this Agreement or the
value of any of the benefits of which will, or may be the option of the holder
or participant, be calculated on the basis of any of the transactions
contemplated by this Agreement.
Except as disclosed on Schedule 2.09, none of the Subsidiaries is a party to any
collective bargaining agreement or other labor agreement with any union or labor
organization and no union or labor organization has been recognized by any of
the Subsidiaries as an exclusive bargaining representative for employees of such
Subsidiary. None of the Subsidiaries is the subject of any material proceeding
asserting that it has committed an unfair labor practice or is seeking to compel
it to bargain with any labor union or labor organization, nor is there pending
or threatened, nor has there been for the past three years, any labor strike,
dispute, walkout, work stoppage, slow-down or lockout involving any of the
Subsidiaries, except in each case as would not, individually or in the
aggregate, have a Material Adverse Effect .
2.10 EMPLOYEE BENEFIT PLANS. (a) Schedule 2.10 contains a list of
each Employee Benefit Plan covering employees of the Subsidiaries. With respect
to each such Plan, York has made available to Empire and/or to Xxxxxxxx a true
and correct copy of (i) the most recent annual report (Form 5500) filed with the
IRS, (ii) such Employee Benefit Plan and all amendments thereto, (iii) each
trust agreement, insurance contract or administration agreement relating to such
Employee Benefit Plan, (iv) the most recent summary plan description for each
Employee Benefit Plan for which a summary plan description is required, (v) the
most recent actuarial report or valuation relating to an Employee Benefit Plan
subject to Title IV of ERISA, (vi) the most recent determination letter, if any,
issued by the IRS with respect to any Employee Benefit Plan intended to be
qualified under section 401(a) of the Code, (vii) any request for a
determination currently pending before the IRS, (viii) all correspondence with
the IRS, the Department of Labor or the PBGC relating to any outstanding
controversy, and (ix) all related trust agreements, insurance contracts or other
funding agreements which implement each such Employee Benefit Plan. Each
Employee Benefit Plan complies with ERISA, the Code and all other applicable
statutes and governmental rules and regulations except to the extent that
noncompliance would not have a Material Adverse Effect on the Subsidiaries.
Except as set forth in Schedule 2.10, (i) no "reportable event" (within the
meaning of Section 4043 of ERISA) has occurred within the past three years with
respect to any
9
Employee Benefit Plan which could result in a material liability to any of the
Subsidiaries, (ii) none of the Subsidiaries nor any of their respective ERISA
Affiliates has withdrawn from any Multiemployer Plan at any time or instituted,
or is currently considering taking, any action to do so, and (iii) no action has
been taken, or is currently being considered, to terminate any Employee Benefit
Plan subject to Title IV of ERISA.
(b) There has been no failure to make any contribution or pay any
amount due to any Employee Benefit Plan as required by Section 412 of the Code,
Section 302 of ERISA, or the terms of any such Plan, and no Employee Benefit
Plan, nor any trust created thereunder, has incurred any "accumulated funding
deficiency" (as defined in Section 302 of ERISA), whether or not waived.
(c) With respect to Employee Benefit Plans, no event has occurred
and there exists no condition or set of circumstances in connection with which
any of the Subsidiaries would be subject, under the terms of such Employee
Benefit Plans, ERISA, the Code or any other applicable law, to any liability
that would have a Material Adverse Effect on the Subsidiaries. Except as set
forth on Schedule 2.10, all Employee Benefit Plans that are intended to be
qualified under Section 401(a) of the Code have been determined by the IRS to be
so qualified, or a timely application for such determination is now pending or
will be filed on a timely basis. None of the Subsidiaries nor any of their
respective ERISA Affiliates has been notified by any Multiemployer Plan that
such Multiemployer Plan is currently in reorganization or insolvency under and
within the meaning of Section 4241 or 4245 of ERISA or that such Multiemployer
Plan intends to terminate or has been terminated under Section 4041A of ERISA.
Neither the termination of any Multiemployer Plan nor the complete or partial
withdrawal by any of the Subsidiaries or any of their respective ERISA
Affiliates from any Multiemployer Plan would result in any material liability to
any of the Subsidiaries or to any of their respective ERISA Affiliates. Except
as set forth on Schedule 2.10, none of the Subsidiaries has any liability or
obligation under any welfare plan to provide life insurance or medical benefits
after termination of employment to any employee or dependent other than as
required by Part 6 of Title 1 of ERISA.
(d) As used in this Agreement, (i) "Employee Benefit Plan" means a
"pension plan" (as defined in Section 3(2) of ERISA (other than a Multiemployer
Plan )), a "welfare plan" (as defined in Section 3(1) of ERISA), or any material
bonus, profit sharing, deferred compensation, incentive compensation, stock
ownership, stock purchase, stock option, phantom stock, vacation, severance,
death benefit, insurance or other plan, arrangement or understanding, in each
case established or maintained or contributed to by any of the Subsidiaries or
any of their respective ERISA Affiliates or as to which any of the Subsidiaries
or any of their respective ERISA Affiliates or otherwise may have any liability,
whether or not covered by ERISA), (ii) "Multiemployer Plan" means a
"multiemployer plan" (as defined in Section 4001(a)(3) of ERISA) to which any of
the Subsidiaries or any of their respective ERISA Affiliates is or has been
obligated to contribute or otherwise may have any liability, and (iii) with
respect to any person, "ERISA Affiliate" means any corporation or trade or
business (whether or not incorporated) which is under common control, or
otherwise would be considered a single employer with such person pursuant to
Section 414(b), (c), (m) or (o) of the Code and the regulations promulgated
thereunder or pursuant to Section 4001(b) of ERISA and the regulations
promulgated thereunder.
(e) Schedule 2.10 contains a list of all (i) severance and
employment agreements with officers of each of the Subsidiaries, (ii) severance
programs and policies of each of the Subsidiaries with or relating to its
employees and (iii) plans, programs, agreements and other arrangements of each
of the Subsidiaries with or relating to its employees which contain change of
control or similar provisions, in each case involving a severance or employment
agreement or arrangement with an individual officer or employee, only to the
extent such agreement or arrangement provides for minimum annual payments in
excess of $50,000. York has provided to Empire and/or to Xxxxxxxx a true and
complete copy of each of the foregoing.
10
(f) Except as otherwise set forth on Schedule 2.10, the consummation
of the transactions contemplated by this Agreement will not accelerate the time
of payment or vesting under any Employee Benefit Plan of the Subsidiaries nor
obligate any of the Subsidiaries or Empire to provide any current or former
officer, director or employee of York or any of the Subsidiaries with severance
pay, unemployment compensation or similar payment.
2.11 PATENTS, TRADEMARKS, COPYRIGHTS, LICENSES AND SECRECY
AGREEMENTS. (a) For the purposes of this Agreement, the following terms have the
following definitions:
"Intellectual Property" shall mean any or all of the following and
all worldwide common law and statutory rights in, arising out of, or associated
therewith that are used in the ordinary course of the business of York or a
Subsidiary or incorporated into current Subsidiary Products: (i) patents and
applications therefor and all reissues, divisions, renewals, extensions,
provisionals, continuations and continuations-in-part thereof ("Patents"); (ii)
inventions (whether patentable or not), invention disclosures, improvements,
trade secrets, proprietary information, know how, technology, technical data and
customer lists, and all documentation relating to any of the foregoing; (iii)
copyrights, copyrights registrations and applications therefor, and all other
rights corresponding thereto throughout the world; (iv) domain names, uniform
resource locators ("URLs") and other names and locators associated with the
Internet (collectively, "Domain Names"); (v) industrial designs and any
registrations and applications therefor; (vi) trade names, logos, common law
trademarks and service marks, trademark and service xxxx registrations and
applications therefor (collectively, "Trademarks"); (vii) all databases and data
collections and all rights therein; (viii) all moral and economic rights of
authors and inventors, however denominated, and (ix) any similar or equivalent
rights to any of the foregoing (as applicable). "York Bronze Intellectual
Property" shall mean any Intellectual Property that is owned by, or exclusively
licensed to, York Bronze. "OMC Intellectual Property" shall mean any
Intellectual Property that is owned by, or exclusively licensed to, OMC. "Sub 1
Intellectual Property" shall mean any Intellectual Property that is owned by, or
exclusively licensed to, Sub 1. "Subsidiary Intellectual Property" shall mean,
collectively, the York Bronze Intellectual Property, the OMC Intellectual
Property and the Sub 1 Intellectual Property.
"Registered Intellectual Property" means all Intellectual Property
that is the subject of an application, certificate, filing, registration or
other document in the name of York or a Subsidiary issued, filed with, or
recorded by any private, state, government or other legal authority. "York
Bronze Registered Intellectual Property" shall mean all of the Registered
Intellectual Property owned by, or filed in the name of, York Bronze. "OMC
Registered Intellectual Property" shall mean all of the Registered Intellectual
Property owned by, or filed in the name of, OMC. "Sub 1 Registered Intellectual
Property" shall mean all of the Registered Intellectual Property owned by, or
filed in the name of, Sub 1. "Subsidiary Registered Intellectual Property" shall
mean, collectively, the York Bronze Registered Intellectual Property, the OMC
Registered Intellectual Property and the Sub 1 Registered Intellectual Property.
"York Bronze Products" means all current versions of products or
service offerings of York Bronze. "OMC Products" means all current versions of
products or service offerings of OMC. "Sub 1 Products" means all current
versions of products or service offerings of Sub 1. "Subsidiary Products" means,
collectively, the York Bronze Products, the OMC Products and the Sub 1 Products.
Except as disclosed in Schedule 2.11 or except as would not have a
Material Adverse Effect, no Subsidiary Intellectual Property or Subsidiary
Product is subject to any proceeding or outstanding decree, order, judgment,
contract, license, agreement or stipulation restricting in any manner the use,
transfer or licensing thereof by any of the Subsidiaries, or which may affect
the validity, use or enforceability of such Subsidiary Intellectual Property or
Subsidiary Product.
Each item of Subsidiary Registered Intellectual Property, to York's
knowledge, is valid and
11
subsisting as provided by law, all necessary registration, maintenance and
renewal fees currently due in connection with such Subsidiary Registered
Intellectual Property have been made an all necessary documents, recordations
and certificates in connection with such Subsidiary Registered Intellectual
Property have been filed with the relevant patent, copyright, trademark or other
authorities in the United States for the purposes of maintaining such Subsidiary
Registered Intellectual Property, except as would not have a Material Adverse
Effect.
(b) Except as disclosed on Schedule 2.11, York Bronze or another
Subsidiary owns and has good title to, each material item of York Bronze
Intellectual Property, free and clear of any Lien (excluding non-exclusive
licenses and related restrictions granted in the ordinary course); and York
Bronze or another Subsidiary is the owner or licensee of all Trademarks
contained in the York Bronze Intellectual Property. Without limiting the
foregoing, (i) York Bronze or another Subsidiary owns or is the licensee of all
copyrighted works that are York Bronze Products or which York Bronze otherwise
purports to own and (ii) except as, individually or in the aggregate, could not
reasonable be expected to have a Material Adverse Effect, to the knowledge of
York, Patents held by third parties, excluding the Subsidiaries, would not be
infringed by any York Bronze Products.
(c) Except as further disclosed on Schedule 2.11, OMC or another
Subsidiary owns and has good title to, each material item of OMC Intellectual
Property, free and clear of any Lien (excluding non-exclusive licenses and
related restrictions granted in the ordinary course); and OMC or another
Subsidiary is the owner or licensee of all Trademarks contained in the OMC
Intellectual Property. Without limiting the foregoing, (i) OMC or another
Subsidiary owns or is the licensee of all copyrighted works that are OMC
Products or which OMC otherwise purports to own and (ii) except as, individually
or in the aggregate, could not reasonable be expected to have a Material Adverse
Effect , to the knowledge of York, Patents held by third parties, excluding the
Subsidiaries, would not be infringed by any OMC Products.
(d) Except as further disclosed on Schedule 2.11, Sub 1 or another
Subsidiary owns and has good title to, each material item of Sub 1 Intellectual
Property, free and clear of any Lien (excluding non-exclusive licenses and
related restrictions granted in the ordinary course); and Sub 1 or another
Subsidiary is the owner of all Trademarks contained in the Sub 1 Intellectual
Property. Without limiting the foregoing (i) Sub 1 or another Subsidiary owns or
is the licensee of all copyrighted works that are Sub 1 Products or which Sub 1
otherwise purports to own and (ii) except as, individually or in the aggregate,
could not reasonably be expected to have a Material Adverse Effect, to the
knowledge of York, Patents held by third parties, excluding the Subsidiaries,
would not be infringed by any Sub 1 Products.
(e) Except as disclosed on Schedule 2.11 or except as would not have
a Material Adverse Effect, to the extent that any technology, software or
Intellectual Property has been developed or created independently or jointly by
a third party for any of the Subsidiaries or is incorporated into any of the
Subsidiary Products, a Subsidiary has a written agreement with such third party
with respect thereto and has thereby either (i) obtained ownership of or (ii)
obtained a perpetual, non-terminable license (sufficient for the conduct of its
business as currently conducted and as proposed to be conducted) to all such
third party's Intellectual Property in such technology, software or Intellectual
Property by operation of law, by valid assignment or by license.
(f) To the knowledge of York, none of the Subsidiaries has
transferred ownership of, or granted any exclusive license with respect to, any
Intellectual Property that is Subsidiary Intellectual Property, to any third
party, or knowingly permitted the Subsidiaries' collective rights in such
Subsidiary Intellectual Property to lapse or enter the public domain.
(g) Schedule 2.11 lists all contracts, licenses and agreements to
which any of the Subsidiaries is a party and that remain in effect: (i) with
respect to Subsidiary Intellectual Property licenses
12
or transferred to any third party resulting in, or which may result in, annual
payments of U.S. $20,000 or more to any of the Subsidiaries, or (ii) pursuant to
which a third party has licensed or transferred any Intellectual Property to any
of the Subsidiaries, except with respect to generally available commercial
Intellectual Property.
(h) To the knowledge of York, the operation of each Subsidiary's
business as such business currently is conducted, including (i) such
Subsidiary's design, development, manufacture, distribution, reproduction,
marketing or sale of the products or services of its business (including
Subsidiary Products), and (ii) such Subsidiary's use of any product device or
process, has not infringed or misappropriated the Intellectual Property of any
third party.
(i) None of the Subsidiaries have received written notice from any
third party that the operation of its business or any act, product or service of
such Subsidiary infringes or misappropriates the Intellectual Property of any
third party or constitutes unfair competition or trade practices under the laws
of any jurisdiction, except as disclosed on Schedule 2.11.
(j) To the knowledge of York, no Person has infringed or is
infringing or misappropriating any Subsidiary Intellectual Property.
2.12 TRADE SECRETS. Subject to the license and secrecy agreements
listed on Schedule 2.12 hereto, the Subsidiaries collectively have the right to
use, free and clear of any claims of others (pending or, to the knowledge of
York, threatened) except the other Subsidiaries, all trade secrets, customer
lists and technical information being used in their businesses to the extent and
on the products on which, or in respect of which, such items are being used.
2.13 GOVERNMENTAL LICENSES AND PERMITS; CONSENTS. (a) Except as
disclosed in Disclosure Schedules, each Subsidiary (except no representation is
made as to Sub 1) is in possession of all franchises, grants, authorizations,
licenses, permits, charters, easements, variances, exceptions, consents,
certificates, approvals and orders of any Governmental Authority (collectively,
"Permits") necessary for such Subsidiary to own, lease and operate its
properties or to carry on its business except as would not have a Material
Adverse Effect (the "Subsidiary Permits"), and no suspension or cancellation of
any of the Subsidiary Permits is pending or, to the knowledge of York,
threatened except as would not have a Material Adverse Effect.
(b) No consents or approvals or filings or registrations with any
Governmental Authority, or under any third party contract, are required to be
made by York or by any of the Subsidiaries or obtained by York or by any of the
Subsidiaries in connection with (i) the execution and delivery by York of this
Agreement and the other Transaction Documents, and (ii) the consummation by York
of the transactions contemplated by this Agreement.
2.14 INDEBTEDNESS AND COMMITMENTS. Schedule 2.14 hereto identifies
each indenture, mortgage, promissory note, or other instrument for borrowed
money under which any of the Subsidiaries has outstanding any indebtedness,
guaranty or liability for borrowed money or the deferred purchase price of
property or has the right or obligation to incur any such indebtedness, guaranty
or liability in each case in excess of $50,000 (the "Debt Instruments"). York
has heretofore made available to Empire and/or to Xxxxxxxx true and complete
copies of each of the Debt Instruments as in effect on the date hereof. Except
as set forth in Schedule 2.14 and except as would not have a Material Adverse
Effect, there is no event of default or condition or event which, with the
giving of notice or the lapse of time or both, could become an event of default
under any of the Debt Instruments.
13
2.15 TAXES. Except as set forth in Schedule 2.15 hereto:
(a) York and each of the Subsidiaries has prepared and executed and
duly filed when due all United States Federal, state and other Tax Returns
required to be filed by applicable laws and regulations and have duly and timely
paid all Taxes or installments thereof that are due with respect to such Tax
Returns;
(b) there are no Liens with respect to Taxes upon any of the assets
of any of the Subsidiaries, other than Liens with respect to Taxes that are not
yet due or remain payable without penalty or are being contested in good faith
and by appropriate proceedings;
(c) there are no agreements, waivers or arrangements by York or by
any of the Subsidiaries for the extension of the time for the assessment of any
amounts of Tax, and no power of attorney granted by York or by any of the
Subsidiaries with respect to any Taxes is currently in effect. No closing
agreement under Section 7121 of the Code or any similar provision of any state
or local law has been entered into by or with respect to any of the
Subsidiaries;
(d) all United States Federal, state and local income Tax Returns of
York and each of the Subsidiaries for each year to and including the year ended
December 31, 1996 have been examined by or accepted as filed with the relevant
Tax authorities and any asserted deficiencies settled and paid;
(e) there have been no deficiencies proposed as a result of the
examination of any United Stated Federal, state or other Tax Returns filed by
York or by any of the Subsidiaries. No audit or other proceeding by any
Governmental Authority is pending or, to the knowledge of York, threatened with
respect to any Taxes due from or with respect to York or any of the Subsidiaries
or any Tax Return filed by or with respect to York or any of the Subsidiaries,
and no assessment of Tax, has been proposed and delivered in writing against
York or any of the Subsidiaries or any of their respective assets;
(f) Neither York nor any of the Subsidiaries has filed or consented
to the filing of any United States Federal or state consolidated income Tax
Return with any other Person (other than a group the common parent of which was
York) during the three (3) years immediately preceding the date hereof;
(g) Neither York nor any of the Subsidiaries has any liability or
potential liability with respect to any consolidated Tax Return filed or to be
filed by any Person (other than a group the common parent of which is York);
(h) Neither York nor any of the Subsidiaries has consented to the
application to it of Section 341(f)(2) of the Code; and
(i) Each Subsidiary has duly and timely withheld from employee
salaries, wages, and other compensation and paid over to the appropriate Taxing
authorities all amounts required to be so withheld and paid over for all periods
under all applicable laws.
2.16 INSURANCE. York has made available to Empire and/or to Xxxxxxxx
complete and correct copies of all insurance policies insuring the Subsidiaries
as in effect on the date hereof. York or each Subsidiary has in effect insurance
coverage for the Subsidiaries with reputable insurer, which in respect of
amounts, premiums, types and risks insured, constitutes reasonably adequate
coverage against all risks customarily insured against by companies of
comparable size and with similar operations.
14
2.17 LITIGATION AND CLAIMS. Except as set forth in Schedule 2.17:
(a) There are no actions, suits or proceedings pending or threatened
against York or any of the Subsidiaries or any of their respective directors,
officers or employees, the business, operations, properties or assets of any of
the Subsidiaries or any Employee Benefit Plan relating to the transactions
contemplated by this Agreement, or which could reasonably be expected, if
adversely determined, to delay, prevent or hinder the consummation of the
transactions contemplated by this Agreement,
(b) Neither York nor any of the Subsidiaries or any of their
respective directors, officers or employees has been charged with violating or
threatened in writing with a charge of violating, any provision of any United
States Federal, state, local or foreign law or administrative ruling or
regulation, and
(c) neither York nor any of the Subsidiaries has received any
currently effective notice of any default, nor to York's knowledge is in
default, under any order, writ, injunction, decree or Permit of any Governmental
Authority.
Except as set forth in Schedule 2.17 or elsewhere on the Disclosure Schedules,
to York's knowledge there is no investigation of the business, operations,
properties or assets of any of the Subsidiaries being conducted by any
Governmental Authority.
2.18 COMPLIANCE WITH LAWS. Except as would not have a Material
Adverse Effect or except as set forth in Schedule 2.18, to York's knowledge each
Subsidiary (i) is in compliance with all laws, regulations, orders, judgments or
decrees of any Governmental Authority, provided that no representation is made
as to Environmental Laws, and (ii) has made and is current with respect to all
filings, reports, certificates, returns and other documentation and writings
required to be furnished at any time or from time to time to any Governmental
Authority, and all such materials so furnished were true, correct and complete,
all amounts shown as due thereon have been paid in full or appropriately
reserved for and based on the affairs, revenues, enrollment or other applicable
measure of operations or assets during the period in question, each such filing,
report, certificate, return or other document or writing correctly stated and
reported the amount due.
2.19 ENVIRONMENTAL AND OCCUPATIONAL SAFETY MATTERS. With respect to
all applicable federal, state, local, regional and foreign laws, rules and
regulations, orders, decrees, common law, judgments, permits and licenses
relating to public and worker health and safety (collectively, "Worker Safety
Laws") and relating to the protection, regulation and clean-up of the indoor and
outdoor environment, including, without limitation, those relating to the
generation, handling, disposal, transportation or release of hazardous or toxic
materials, substances, wastes, pollutants and contaminants including, without
limitation, asbestos, petroleum, radon and polychlorinated biphenyls
(collectively, "Environmental Laws") York has in good faith made reasonable
efforts to disclose on Schedule 2.19 and during due diligence any matter which,
to York's knowledge, could have a Material Adverse Effect, but otherwise makes
no statements, representations or warranties and Empire and Xxxxxxxx take the
Purchased Stock, the Subsidiaries and their assets and liabilities "AS IS, WHERE
IS" AND "WITH ALL FAULTS" with respect to such Environmental Laws and Worker
Safety Laws.
2.20 BROKERS' FEES. York has not incurred any liability for
brokerage fees, finder's fees, agent's commissions or other similar forms of
compensation in connection with this Agreement or any transaction contemplated
hereby for which any of the Subsidiaries, Empire or Xxxxxxxx will be
responsible.
2.21 CONTINGENCIES. Except for:
(a) liabilities which are disclosed and fully provided for in the
most recent balance sheet
15
referred to in Section 2.05,
(b) liabilities incurred in the usual and ordinary course of
business of the Subsidiaries subsequent to the date of such balance sheet and on
or prior to the Closing Date,
(c) liabilities disclosed in Schedule 2.21 to this Agreement, and
(d) liabilities relating to Environmental Laws,
none of the Subsidiaries has any material liabilities or obligations (absolute
or contingent, known or unknown, asserted or unasserted), including without
limitation contingent liability for the performance of any obligation by any
other Person.
2.22 CONDITION OF TANGIBLE ASSETS. To the knowledge of York, no
tangible assets of the Subsidiaries which are material to the operations of the
Subsidiaries are reasonably likely to be unavailable for use (except to the
extent scheduled to be repaired or replaced) in the ordinary course of business
during the next three months succeeding the date of this Agreement or except as
would not have a Material Adverse Effect. Subject to the previous sentence and
the representations and warranties set forth elsewhere in this Agreement, the
assets of each of the Subsidiaries shall be accepted by Empire and Xxxxxxxx in
its "AS IS" "WHERE IS" AND "WITH ALL FAULTS" condition, with any and all faults,
defects and conditions, without representation or warranty of any kind, express,
implied, statutory or otherwise, including, without limitation, any warranty as
to habitability, suitability, merchantability, condition or fitness, fitness for
a particular purpose or fitness for any purpose.
2.23 INVENTORY. The inventory of each of the Subsidiaries is taken
and shall be accepted by Empire and Xxxxxxxx in its "AS IS" "WHERE IS" AND "WITH
ALL FAULTS" condition, with any and all faults, defects and conditions, without
representation or warranty of any kind, express, implied, statutory or
otherwise, including, without limitation, any warranty as to habitability,
suitability, merchantability, condition or fitness, fitness for a particular
purpose or fitness for any purpose.
2.24 BOOKS AND RECORDS. Except as would not have a Material Adverse
Effect, the minute books and other similar records of each of the Subsidiaries
contain a true and complete record of all actions taken at all meetings and by
all written consents in lieu of meetings of such Subsidiary's stockholders,
boards of directors, and committees thereof. Such books and records have been
maintained in accordance with good business and bookkeeping practices.
2.25 WARRANTIES. The accrual for warranty related expenses as of
December 31, 2000 reported in York's audited financial statements for the year
ended December 31, 2000, adequately reflects an amount required for satisfaction
of warranty claims due in respect of goods sold or services provided by each
Subsidiary prior to such date, except as would not have Material Adverse Effect.
Such provision has been established in accordance with GAAP, except as would not
have Material Adverse Effect. No Subsidiary has agreed to provide any express
product or service warranties other than standard warranties, the terms of which
York has made available to Empire and/or to Xxxxxxxx and identified as such
Subsidiary's standard warranties.
2.26 RESTRICTIONS ON BUSINESS ACTIVITIES. There is no agreement,
commitment, judgment, injunction, order or decree binding upon any of the
Subsidiaries or to which any of the Subsidiaries is a party which has or could
reasonably be expected to have the effect of prohibiting or materially impairing
any business practice of such Subsidiary, any acquisition or transfer of
property by York or by such Subsidiary or the conduct of business by such
Subsidiary, as currently conducted.
16
ARTICLE III
Representations and Warranties of Xxxxxxxx and Empire
Xxxxxxxx and Empire represent and warrant to York that the
statements contained in this Article III are correct and complete.
3.01 ORGANIZATION AND AUTHORITY. (a) Empire is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Delaware. Empire has the corporate power and authority to execute and deliver
this Agreement and each of the other Transaction Documents to which it is a
party and to perform its obligations hereunder and thereunder. There are no
dissolution, liquidation or bankruptcy proceedings pending, contemplated by or,
to the knowledge of Xxxxxxxx or Empire, threatened against Empire.
(b) Xxxxxxxx is a corporation duly organized, validly existing and
in good standing under the laws of the Commonwealth of Pennsylvania. Xxxxxxxx
has the corporate power and authority to execute and deliver this Agreement and
each of the other Transaction Documents to which it is a party and to perform
its obligations hereunder and thereunder. There are no dissolution, liquidation
or bankruptcy proceedings pending, contemplated by or, to the knowledge of
Xxxxxxxx or Empire, threatened against Xxxxxxxx.
3.02 DUE AUTHORIZATION. (a) The execution and delivery by Empire of
this Agreement and each of the other Transaction Documents to which it is a
party, the performance by it of all the terms and conditions hereof and thereof
to be performed by it and the consummation of the transactions contemplated
hereby and thereby have been duly authorized and approved by all necessary
corporate proceedings on the part of Empire. No other corporate proceeding on
the part of Empire is necessary to approve and adopt this Agreement and each of
the other Transaction Documents to which it is a party and to consummate the
transactions contemplated hereby and thereby. This Agreement and the other
Transaction Documents to which Empire is a party have been duly and validly
executed by Empire and constitute the legal, valid and binding obligations of
Empire enforceable against Empire in accordance with their respective terms,
subject to bankruptcy, insolvency or other similar laws of general application
affecting creditors' rights and general principles of equity.
(b) The execution and delivery by Xxxxxxxx of this Agreement and
each of the other Transaction Documents to which it is a party, the performance
by it of all the terms and conditions hereof and thereof to be performed by it
and the consummation of the transactions contemplated hereby and thereby have
been duly authorized and approved by all necessary corporate proceedings on the
part of Xxxxxxxx. No other corporate proceeding on the part of Xxxxxxxx is
necessary to approve and adopt this Agreement and each of the other Transaction
Documents to which it is a party and to consummate the transaction contemplated
hereby and thereby. This Agreement and the other Transaction Documents to which
Xxxxxxxx is a party have been duly and validly executed by Xxxxxxxx and
constitute the legal, valid and binding obligations of Xxxxxxxx enforceable
against Xxxxxxxx in accordance with their respective terms, subject to
bankruptcy, insolvency or other similar laws of general application affecting
creditors' rights and general principles of equity.
3.03 ABSENCE OF CONFLICTS. The execution and delivery by each of
Empire and Xxxxxxxx of this Agreement and each of the other Transaction
Documents to which it is a party, the compliance by each of Empire and Xxxxxxxx
with the terms and conditions hereof and thereof, and the consummation by each
of Empire and Xxxxxxxx of the transactions contemplated hereby and thereby will
not:
(a) conflict with any of the terms, conditions or provisions of the
articles of incorporation
17
or bylaws of either of Empire or Xxxxxxxx,
(b) violate any provision of, or require any consent, authorization
or approval under, any law or administrative regulation or any judicial,
administrative or arbitration order, award, judgment, writ, injunction or decree
applicable to, or any Permit issued to, or notice to or filing with any
Governmental Authority with respect to either of Empire or Xxxxxxxx,
(c) violate, conflict with, result in a breach of any provision of
or the loss of any benefit under, constitute a default (or an event which, with
notice or lapse of time or both, would constitute a default) under, or require
any consent, authorization or approval under, any of the terms conditions or
provisions of any note, bond mortgage, indenture, Lien or other agreement,
instrument for borrowed money, any guarantee of any agreement or instrument for
borrowed money or any license, lease or any other agreement or instrument to
which either of Empire or Xxxxxxxx is a party or by which it is bound or to
which any of its properties or assets is subject,
(d) result in the creation of any Lien upon any of the assets of
either of Empire or Xxxxxxxx, or
(e) give to others any material rights or interests (including
rights of purchase, termination, cancellation or acceleration) under any such
indenture, mortgage, Lien, lease, agreement or instrument, which, with respect
to the matters specified in clauses (b) through (e) of this Section 3.03 could
reasonably be expected to delay, prevent or hinder in any material respect the
transactions contemplated hereby.
3.04 LITIGATION AND CLAIMS. There are no actions, suits or
proceedings pending or, to the knowledge of Xxxxxxxx or Empire, threatened
against either of Empire or Xxxxxxxx which could reasonably be expected, if
adversely determined, to delay, prevent or hinder the consummation of the
transactions contemplated by this Agreement.
3.05 BROKERS' FEES. Neither Empire nor Xxxxxxxx has incurred any
liability for brokerage fees, finder's fees, agent's commissions or other
similar forms of compensation in connection with this Agreement or any
transactions contemplated hereby for which York will be responsible.
3.06 GOVERNMENTAL APPROVALS. No consents or approvals of or filings
or registrations with Governmental Authority, or with any third party are
required to be made or obtained by either of Empire or Xxxxxxxx in connection
with (i) the execution and delivery by each of Empire and Xxxxxxxx of this
Agreement and the other Transaction Documents and (ii) the consummation by each
of Empire and Xxxxxxxx of the transactions contemplated by this Agreement.
3.07 WARRANTIES. YORK HAS NOT MADE, AND YORK HEREBY EXPRESSLY
DISCLAIMS AND NEGATES, ANY REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED, OF
ANY KIND OR NATURE WHATSOEVER, RELATING TO ANY IMPLIED OR EXPRESSED WARRANTY OF
MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE, OR ANY IMPLIED OR EXPRESSED
WARRANTY CONCERNING ENVIRONMENTAL CONDITION, ZONING, FLOODING OR DRAINAGE
CHARACTERISTICS, WETLANDS STATUS, FAULTING CHARACTERISTICS OR SOIL CONDITIONS
WITH RESPECT TO THE SUBSIDIARIES AND THEIR ASSETS. EMPIRE AND XXXXXXXX
ACKNOWLEDGE THAT ENVIRONMENTAL PERMITS ARE REQUIRED FOR EMPIRE TO OWN AND
OPERATE CERTAIN OF THE ASSETS OF THE SUBSIDIARIES AND THAT LICENSES OR OTHER
APPROVALS MAY BE REQUIRED TO OPERATE CERTAIN OF THE ASSETS OF THE SUBSIDIARIES.
EMPIRE AND XXXXXXXX ACKNOWLEDGE AND AGREE THAT CERTAIN OF THE ENVIRONMENTAL
PERMITS OF THE SUBSIDIARIES OR THEIR BUSINESSES OR THEIR ASSETS AND ANY
APPLICABLE LICENSES
18
NECESSARY TO OPERATE SUCH ASSETS MAY NOT BE FREELY ASSIGNABLE TO EMPIRE. EMPIRE
AND XXXXXXXX ACKNOWLEDGE AND AGREE THAT UNDER SOME CIRCUMSTANCES THERE MAY BE A
PERIOD OF TIME BETWEEN ACQUISITION OF AN ASSET AND ISSUANCE, REISSUANCE OR
TRANSFER OF A PERMIT BY A GOVERNMENTAL AUTHORITY, AND, SUBJECT TO THE
OBLIGATIONS OF YORK UNDER THIS AGREEMENT TO COOPERATE WITH AND ASSIST EMPIRE IN
CONNECTION THEREWITH, EMPIRE ASSUMES ALL RISKS RELATED THERETO, INCLUDING RISK
OF FINES AND PENALTIES ASSOCIATED WITH ACQUISITION AND OPERATION OF AN ASSET
PRIOR TO ISSUANCE, REISSUANCE OR TRANSFER OF A PERMIT OR LICENSE. IF ANY
ENVIRONMENTAL PERMITS ARE ISSUED, REISSUED, OR TRANSFERRED TO EMPIRE, EMPIRE AND
XXXXXXXX UNDERSTAND AND ACKNOWLEDGE THAT THEY MAY CONTAIN DIFFERENT OR LESS
FAVORABLE TERMS THAN THOSE ENVIRONMENTAL PERMITS CURRENTLY HELD BY YORK OR THE
SUBSIDIARIES. EMPIRE AND XXXXXXXX ACKNOWLEDGE THAT THE PROVISIONS OF THIS
SECTION 3.07 ARE A MATERIAL PORTION OF THE INDUCEMENT TO YORK TO SELL THE
PURCHASED STOCK EMPIRE, AND THAT BUT FOR SUCH PROVISIONS, YORK WOULD NOT SELL
THE PURCHASED STOCK TO EMPIRE.
ARTICLE IV
Covenants
4.01 EMPLOYEES. (a) None of Xxxxxxxx, Empire nor York intends this
Agreement to create any rights or interests, except as between Xxxxxxxx, Empire
and York, and no present, former or future employee of Xxxxxxxx, Empire or York
shall be treated as a third party beneficiary by, in or under this Agreement.
Nothing in this Agreement shall affect the ability of Xxxxxxxx or Empire to hire
or terminate the employment of employees.
(b) York shall be liable for compliance with the WARN Acts insofar
as they relate to any facilities closing, mass layoff or similar event which
occurs before the Closing. Xxxxxxxx and Empire shall be liable for compliance
with the WARN Acts insofar as they relate to any facilities closing, mass layoff
or similar event which occurs upon or after the Closing.
(c) For at least two (2) years following the Closing, Xxxxxxxx or
Empire, as the case may be, agrees to provide employee benefits to the
Subsidiaries' employees which are in the aggregate, no less favorable than such
benefits that were provided by York and the Subsidiaries as of the Closing. For
these purposes, the Subsidiaries' employees will be given credit for years of
service with York, its subsidiaries and their predecessors for all employee
benefit purposes, with the exception of the defined benefit pension plans of
Xxxxxxxx.
4.02 FINANCIAL STATEMENTS. York will cause its auditors to provide
to Xxxxxxxx and to Empire, on or prior to sixty five (65) days after the date
hereof, the audited financial statements of the Subsidiaries which are necessary
for Xxxxxxxx to meet its reporting obligations under Items 2 and 7 of Form 8-K
under the Securities Exchange Act of 1934, as amended. Xxxxxxxx shall pay to
York one half of the fees of York's auditors in connection with the same.
4.03 TAX MATTERS. Xxxxxxxx and York agree to furnish or cause to be
furnished to each other, upon request, as promptly as practicable, such
information and assistance relating to the Subsidiaries (including, without
limitation, access to books and records) as is reasonably necessary for the
filing of all Tax Returns, and making of any election related to Taxes, the
preparation for any audit by any taxing authority, and the prosecution or
defense of any claim, suit or proceeding relating to any Tax Return. Xxxxxxxx
and York will retain all books and records with respect to Taxes pertaining to
the Subsidiaries for a period of at least six (6) years following the Closing.
Xxxxxxxx and York will cooperate with each other
19
in the conduct of any audit or other proceeding related to Taxes and each will
execute and deliver such powers of attorney and other documents as are necessary
to carry out the intent of this Section 4.03.
4.04 ENVIRONMENTAL RESPONSE. (a) Xxxxxxxx and Empire acknowledge
that the York Bronze Real Property, the OMC Real Property and the Sub 1 Real
Property are subject to on-going environmental investigation, remediation,
and/or other corrective work and response actions undertaken pursuant to the
Colonial Guild Merger Documents (as hereinafter defined) and the OMC Merger
Documents (as hereinafter defined) (collectively, "Environmental Response
Activities"). Xxxxxxxx and Empire consummate the transactions contemplated by
this Agreement with the understanding that the Environmental Response Activities
set forth on Schedule 4.04 have been identified as needing to be completed after
the date of this Agreement by the Shareholder Representatives (as that term is
defined in the Colonial Guild Merger Documents) and the Shareholders (as that
term is defined in the OMC Merger Documents) in accordance with the terms of
such agreements and subject to the rights and remedies of York thereunder.
(b) The Xxxxxxxx Group (as defined below) grants the Shareholder
Representatives, the Shareholders and York and their respective contractors,
subcontractors, and representatives, such reasonable access to that portion of
the York Bronze Real Property, the OMC Real Property and the Sub 1 Real Property
as is necessary for the purpose of performing their respective obligations with
respect to Environmental Response Activities as described in the Colonial Guild
Merger Documents and OMC Merger Documents. The parties agree to reasonably
cooperate with respect to the work to be completed on the York Bronze Real
Property, the OMC Real Property and the Sub 1 Real Property, such that Xxxxxxxx
and Empire use reasonable efforts not to interfere with, hinder or prevent the
rights and obligations of York, the Shareholder Representatives and the
Shareholders to complete the Identified Environmental Response Activities
(defined below), and York uses reasonable efforts to minimize the disruption of
Xxxxxxxx' operations. Xxxxxxxx and the Subsidiaries agree to designate in
writing to York the name and contact information of its representative to
participate in the process of consulting and, if desired by York, approving any
ongoing Environmental Response Activities under the Colonial Guild Merger
Documents and/or the OMC Merger Documents at the York Bronze Real Property, the
OMC Real Property and/or the Sub 1 Real Property. The Xxxxxxxx Group agrees to
promptly provide comments to any work proposed by York, the Shareholder
Representatives or the Shareholders; provided, however, that any proposed
changes by the Xxxxxxxx Group to the work to be performed at the York Bronze
Real Property, the OMC Real Property and/or the Sub 1 Real Property shall be in
conformance with the requirements of the Colonial Guild Merger Documents or OMC
Merger Documents and shall be reasonable in view of York's rights and remedies
thereunder. If no comments are provided within ten business days of the Xxxxxxxx
Group's receipt of such proposed Environmental Response Activities, it will be
presumed that the Xxxxxxxx Group has agreed to the proposed Environmental
Response Activities.
(c) York agrees to continue after the Closing to perform its
obligations under the Colonial Guild Merger Documents and the OMC Merger
Documents with respect to the Environmental Response Activities, consisting only
of (i) any claimed Shareholders' Environmental Escrow Obligations as that term
is defined in the Colonial Guild Merger Documents, (ii) the preparation of a
storm water pollution prevention plan and obtaining a storm water general permit
from the Texas Natural Resource Conservation Commission for the OMC Real
Property and (iii) the matters set forth in the Response Activities Agreement of
the OMC Merger Documents (collectively, the "Identified Environmental Response
Activities"), including the handling of any escrows or payments to environmental
consultants or attorneys and any arbitration or litigation, now pending or
hereafter commenced, arising from such Identified Environmental Response
Activities, until the conclusion thereof, except to the extent caused by or
attributable to any breaches by the Xxxxxxxx Group of any of their obligations
hereunder. York shall have the responsibility to use commercially reasonable
efforts to cause the Shareholder Representatives and the Shareholders to
complete the Identified Environmental Response Activities but only to the extent
it can avail itself of its
20
rights under the Colonial Guild Merger Documents and OMC Merger Documents and
their related escrows to fund the same. As used herein, the standard for
completion of any Identified Environmental Response Activities shall be (i) the
obtaining of any necessary permits or other authorizations with respect to the
storm water issue at Bryan, Texas, or (ii) receipt of "Completion Evidence" as
that term is defined in the Colonial Guild Merger Documents or "Closure" as that
term is defined in the OMC Merger Documents.
(d) If, but only if, the Xxxxxxxx Group requests any Environmental
Response Activities other than or in addition to the Identified Environmental
Response Activities to be performed at the York Bronze Real Property, the OMC
Real Property or the Sub 1 Real Property, (i) the Xxxxxxxx Group will contact
York, and the parties agree to reasonably cooperate to have York present the
same to and process the same with the Shareholder Representatives and the
Shareholders, with York having only the obligation to use commercially
reasonable efforts, at no cost or expense to York, to undertake the
responsibility for advocating the Xxxxxxxx Group position to the Shareholder
Representatives or the Shareholders within, and participating in, the dispute
resolution procedures under such documents, (ii) the Xxxxxxxx Group agrees to be
bound by any decision reached under the dispute resolution procedures of the
Colonial Guild Merger Documents or the OMC Merger Documents without any recourse
against York and (iii) the Xxxxxxxx Group agrees to defend, hold harmless, and
indemnify York against all claims, demands, disputes, losses, damages, costs and
expenses (including without limitation attorneys' and other professionals' fees)
associated with or arising from the assertion of the Xxxxxxxx Group's position
at its or their request as described above and resolution of disputes with
respect to the same.
(e) Other than with respect to its agreement to use its commercially
reasonable efforts to take the actions described above with respect to the
Identified Environmental Response Activities affecting the York Bronze Real
Property, the OMC Real Property, the Sub 1 Real Property or the Subsidiaries,
York shall bear no responsibility, liability, obligation or duty to the Xxxxxxxx
Group or any other Person for (i) any particular results with respect to such
Environmental Response Activities, (ii) any disbursement from the Escrow Deposit
(as defined under the Colonial Guild Merger Documents) authorized by York for
any proposed Environmental Response Activities approved or deemed approved by
the Xxxxxxxx Group hereunder, (iii) any reimbursement from the Escrow Deposit to
any party to the Colonial Guild Merger Documents, or (iv) the amount of the
Escrow Deposit and its sufficiency for any Environmental Response Activities.
For purposes of this Agreement, the "Colonial Guild Merger
Documents" shall include the Agreement and Plan of Merger entered into as of
February 17, 1998 by and among York, Colonial Acquisition Corp., and Colonial
Guild, Ltd., and all other documents and amendments associated with that
transaction, including without limitation the Escrow Agreement, Access
Agreement, and Letter Agreement and the "OMC Merger Documents" shall include the
Agreement and Plan of Merger entered into as of December 18, 1998 by and among
The York Group, Inc., York Acquisition Corp. III, OMC Industries, Inc., and Xxx
Xxxxxxxx and Xxxxx Xxxxxxxx, and all other documents and amendments associated
with that transaction, including without limitation, the Fixed Fee Remediation
Contract and the Response Activities Agreement and the Pollution Legal Liability
Select Policy issued to York by American International Specialty Lines Insurance
Company (the "OMC Insurance Policy"). York shall remain the named insured under
the OMC Insurance Policy.
For purposes of this Section 4.04, the "Xxxxxxxx Group" shall mean,
collectively, Xxxxxxxx, Empire and (after the Closing) the Subsidiaries.
4.05 POST-CLOSING CORPORATE GOVERNANCE OF SUBSIDIARIES. Xxxxxxxx,
Empire and York agree as follows with respect to corporate governance and
related matters applicable to each of the Subsidiaries after the Closing Date:
21
(a) The Board of Directors of each of the Subsidiaries shall consist
of two (2) persons, one (1) designated by Empire (the "Empire Designee") and one
(1) designated by York (the "York Designee" and, together with the Empire
Designee, the "Designees"). Either party may remove its Designee from time to
time, and any vacancy created by the removal, resignation, death or disability
of a director shall be filled by the party designating the applicable Designee.
Xxxxxx Xxxxxxxx shall be the initial York Designee and Xxxxx Xxxxx shall be the
initial Empire Designee. Each of Empire and York shall, and York shall cause
York Bronze and OMC to, vote all shares of voting stock in the Subsidiaries in
favor of such Designees.
(b) Neither Empire nor York shall transfer any of its shares of York
Bronze Common Stock or OMC Common Stock without the prior written consent of the
other party. Any purported transfer without such consent shall be null and void.
(c) Neither Empire nor York shall permit or suffer to exist any Lien
on or affecting its shares of York Bronze Common Stock or OMC Common Stock.
(d) Effective as of the Closing Date, the officers of York Bronze,
OMC and Sub 1 shall be the persons identified on Schedule 4.05(d), subject to
change from time to time by action of the Board of Directors of the respective
Subsidiaries.
(e) Effective as of the Closing Date, Xxxxxxxx and Empire shall
cause the Subsidiaries to be covered by the insurance policies and programs of
Xxxxxxxx and its Affiliates.
(f) The Boards of Directors of York Bronze and OMC shall, and York
and Empire as the shareholders of York Bronze and OMC shall, at the earliest
time as either such shareholder deems appropriate, take steps to liquidate and
dissolve York Bronze and OMC (the "Liquidation") and, in connection with such
Liquidation, to cause Empire to assume all Liabilities of York Bronze and OMC
(other than Liabilities relating to Excluded Assets), to distribute the Sub 1
Common Stock and the Sub 1 Preferred Stock to Empire and to distribute the
Excluded Assets and the $7,790,000 paid to York Bronze and the $1,100,000 paid
to OMC under the Asset Purchase Agreement, including any interest and dividends
earned or accrued thereon after the closing of the Asset Purchase Agreement, to
York. Each party shall execute such documents and take such actions as may be
reasonably required to carry out the Liquidation in an orderly fashion.
(g) In the event that the liquidating distributions to York upon the
Liquidation of York Bronze and OMC (the "Actual York Liquidation Proceeds") is
not greater than or equal to $8,890,000, plus any interest that would have
accrued thereon from the date of closing the Asset Purchase Agreement to the
date of receipt by York of such proceeds (the "Expected York Liquidation
Proceeds"), Xxxxxxxx and Empire shall make a cash payment on the date of the
liquidating distributions to York in an amount equal to the Expected York
Liquidation Proceeds less the Actual York Liquidation Proceeds. The parties
acknowledge that until the Liquidation occurs, the $8,890,000 paid to York
Bronze and OMC under the Asset Purchase Agreement shall be invested at the
discretion of York.
4.06 USES OF NAMES. (a) Effective from and after the Closing and up
to December 31, 2001, York hereby grants the Xxxxxxxx Group the nonexclusive,
royalty-free right to use (without right of sublicense) the name "York Bronze"
any derivative thereof and any corporate symbols or logos related thereto, but
only in connection with the conduct and operation of the businesses of the
Subsidiaries, PROVIDED, HOWEVER, that the Xxxxxxxx Group shall not represent or
hold itself out as representing York and PROVIDED FURTHER, HOWEVER, that the
Xxxxxxxx Group shall indemnify and hold harmless York from and Adverse
Consequences incurred by York as a result of the Xxxxxxxx Group's use of such
names or symbols or logos.
22
(b) The Xxxxxxxx Group acknowledges that, except for the limited
right granted by this Section, the Xxxxxxxx Group has no right or interest in
the name "York" or any trade name, service name, trademark or service xxxx or
logos relating thereto. Except as set forth in this Section, the Xxxxxxxx Group
shall not use any name, trade name, service xxxx, trademark, service xxxx or any
related logos or symbols incorporating "York" in any manner whatsoever. Prior to
December 31, 2001, the Xxxxxxxx Group shall take all such action as is necessary
to cause the Subsidiaries to make all filings as necessary to change their
corporate names to names that do not contain "York" or any substantially or
confusingly similar name or reference, and thereafter, the Xxxxxxxx Group shall
take all such action as is necessary to cause the Xxxxxxxx Group and its
Affiliates to cease using any name, trade name, trademark or service xxxx or any
related logos or symbols incorporating "York" in any manner whatsoever.
ARTICLE V
Remedies for Breaches of this Agreement
5.01 SURVIVAL OF REPRESENTATIONS, WARRANTIES AND COVENANTS. All of
the representations, warranties and covenants of the parties contained in this
Agreement shall survive the Closing (even if the damaged party knew or had
reason to know of any misrepresentation or breach of warranty at the time of the
Closing) and shall continue in full force and effect thereafter for a period of
one (1) year; provided, that (a) Sections 4.01(c), 4.06, 7.01, 7.02 and 7.11
shall survive for the applicable statute of limitations period and (b) if the
Liquidation shall not have occurred within such one (1) year period, the
covenants set forth in Section 4.05 shall remain in effect until the earlier to
occur of (i) the Liquidation or (ii) disposition by York of its shares of York
Bronze Common Stock and OMC Common Stock, and (c) Sections 5.03(a)(ii) and (iii)
shall survive the Closing without limitation. XXXXXXXX AND EMPIRE HEREBY WAIVE
FROM AND AFTER CLOSING TO THE FULLEST EXTENT PERMITTED BY LAW, ANY AND ALL
RIGHTS, CLAIMS, ACTIONS OR CAUSES OF ACTION EITHER OF THEM MAY HAVE AGAINST YORK
AND ITS AFFILIATES RELATING TO THE SUBJECT MATTER OF THIS AGREEMENT AND THE
CERTIFICATES AND OTHER DOCUMENTS DELIVERED PURSUANT TO THIS AGREEMENT, OTHER
THAN CLAIMS UNDER SECTIONS 5.02, 7.01, 7.02 AND 7.11 AND OF FRAUD AND RIGHTS,
CLAIMS, ACTIONS AND CAUSES OF ACTION ARISING OUT OF A BREACH OF ANY COVENANT OR
AGREEMENT OF YORK. FURTHER, EXCEPT AS PROVIDED IN SECTIONS 5.02, 7.01, 7.02 AND
7.11 XXXXXXXX AND EMPIRE WAIVE, RELEASE AND COVENANT NOT TO XXX YORK AND ITS
AFFILIATES FOR ANY DAMAGES OF ANY KIND OR CHARACTER, ARISING UNDER ANY
ENVIRONMENTAL LAW (STATUTORY, REGULATORY, COMMON LAW OR OTHERWISE) RELATING TO
ANY DAMAGE, INCLUDING STRICT LIABILITY, INCURRED OR ALLEGEDLY INCURRED BY EITHER
OF XXXXXXXX OR EMPIRE. IN ADDITION, XXXXXXXX AND EMPIRE COVENANT AND AGREE THAT
NEITHER OF THEM SHALL FILE ANY CLAIMS WITH ANY INSURER OF YORK OR ITS AFFILIATES
FOR RECOVERY UNDER ANY INSURANCE POLICIES COVERING YORK OR ITS AFFILIATES AND DO
HEREBY WAIVE, IRREVOCABLY AND FOREVER AND TO THE FULLEST EXTENT PERMITTED BY
LAW, ANY RIGHTS THEY MAY HAVE TO RECOVER UNDER SUCH INSURANCE POLICIES;
PROVIDED, HOWEVER, THAT XXXXXXXX SHALL HAVE THE RIGHT TO CLAIM AGAINST THE
AMERICAN INTERNATIONAL SPECIALTY LINES INSURANCE COMPANY POLLUTION LEGAL
LIABILITY SELECT POLICY, POLICY NUMBER PLS2674645, ISSUED TO YORK.
5.02 INDEMNIFICATION PROVISIONS FOR BENEFIT OF XXXXXXXX AND EMPIRE.
(a) Subject to the terms and conditions of this Article V, if there is any
breach or inaccuracy of any of the representations, warranties or covenants of
York contained herein, or if any third party alleges facts that, if true, would
mean that such a breach or inaccuracy existed, and provided that the Parent
Group delivers to York, pursuant to Section 5.04 hereof, a claim for
indemnification with respect to such alleged breach or inaccuracy, then
23
York shall indemnify the Parent Group, from and against all Adverse Consequences
that the Parent Group has suffered caused by, resulting from, arising out of or
relating to such breach or inaccuracy through and after the date of such claim.
For purposes of this Agreement, the "Parent Group" shall mean either or both of
Xxxxxxxx and Empire.
(b) York's obligations under Section 5.02(a) shall be subject to
the following limitations:
(i) York shall not have any liability to the Parent Group for
Adverse Consequences for any breach of the representations,
warranties or covenants under this Agreement or the Asset
Purchase Agreement to the extent the aggregate amount of all
such Adverse Consequences for which York would otherwise be
liable under this Agreement and under Section 5.02(a) of the
Asset Purchase Agreement exceeds Ten Million Dollars
($10,000,000);
(ii) York shall not have any liability to the Parent Group for
Adverse Consequences for any breach of the representations or
warranties under this Agreement or under the Asset Purchase
Agreement unless and until the aggregate amount of all such
Adverse Consequences relating thereto for which York would,
but for this Section 5.02(b)(ii) or Section 5.02(b)(ii) of the
Asset Purchase Agreement, be required to indemnify the Parent
Group exceeds on a cumulative basis an amount (the "Basket
Amount") equal to Five Hundred Thousand Dollars ($500,000), at
which point York, subject to the further terms, conditions and
limitations of this Agreement and the Asset Purchase
Agreement, shall indemnify the Parent Group for all Adverse
Consequences exceeding the Basket Amount;
(iii) if a reserve (in the form of an accrued Liability or an offset
to an asset or similar item) was reflected in the Financial
Statements relating to any matter for which the Parent Group
would otherwise be entitled to indemnification under this
Agreement or the Asset Purchase Agreement, then the
calculation of the Parent Group's Adverse Consequences in
respect of such matter shall be reduced by the full amount of
the reserve as reflected in Financial Statements; and
(iv) the obligations to indemnify and hold the Parent Group
harmless shall terminate as to each representation, warranty
and covenant when each such representation, warranty or
covenant terminates; provided, however, that such obligations
to indemnify and hold harmless shall not terminate with
respect to any item as to which the Parent Group shall have,
prior to the expiration of the applicable period, previously
made a claim by delivering an indemnification notice pursuant
to Section 5.04 and in compliance with the requirements
therefor, but only with respect to the content of, and on the
basis set forth in, such indemnification notice.
(c) York's obligation to indemnify Parent Group under Section
5.02(a) shall not be affected or limited by Parent Group's obligation to
indemnify York and its Affiliates under Section 5.03(a)(iii)(3).
5.03 INDEMNIFICATION PROVISIONS FOR BENEFIT OF YORK. (a) Subject to
the terms and conditions of this Article V, Xxxxxxxx and Empire shall have the
following indemnification obligations:
(i) If there is any breach or inaccuracy of any of the
representations, warranties or covenants of the Parent
Group contained herein, or if any third party alleges facts
24
that, if true, would mean that such a breach or inaccuracy
existed, and provided that York deliver to the Parent Group
pursuant to Section 5.04 hereof a claim for indemnification
with respect to such alleged breach or inaccuracy, then
Xxxxxxxx and Empire, jointly and severally, shall indemnify
York from and against all Adverse Consequences that York
has suffered or may suffer caused by, resulting from,
arising out of or relating to such breach or inaccuracy
through and after the date of such claim,
(ii) Xxxxxxxx and Empire, jointly and severally, shall indemnify
York and its Affiliates for any fines, penalties, and Adverse
Consequences relating to any recission (but not attorneys'
fees) resulting from, arising out of or relating to any
violation of the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act
of 1976, as amended, and the rules and regulations thereunder,
in connection with the transactions contemplated by this
Agreement, the Asset Purchase Agreement and any other
agreements among the parties or their Affiliates.
(iii) Empire and Xxxxxxxx, jointly and severally, shall indemnify
York and its Affiliates from and against any and all
Liabilities and other Adverse Consequences resulting from,
arising out of or relating to (1) the Liquidation of OMC
and/or York Bronze, (2) any attempt by a third party to
recover any amount of the Actual York Liquidation Proceeds
from York or its Affiliates, and (3) any failure by Sub 1 or
any of its Affiliates to fully pay, perform or otherwise
satisfy any of the Assumed Liabilities as defined in the
Contribution, Assignment and Assumption Agreement dated as of
May 21, 2001; PROVIDED, HOWEVER, that Xxxxxxxx and Empire
shall not be required to indemnify York and its Affiliates
under this Section 5.03(a)(iii)(3) if and only to the extent
that (and only for so long as) Parent Group is entitled to
indemnification from York under Section 5.02(a).
(b) The Parent Group's obligations under Section 5.03(a)(i) shall be
subject to the following limitations:
(i) The Parent Group shall not have any liability for Adverse
Consequences for any breach of representations, warranties
or covenants under Section 5.03(a)(i) of this Agreement or
Section 5.03(a)(i) of the Asset Purchase Agreement to the
extent the aggregate amount of all such Adverse
Consequences for which the Parent Group would otherwise be
liable under Section 5.03(a)(i) of this Agreement and under
Section 5.03(a)(i) of the Asset Purchase Agreement exceeds
Ten Million Dollars ($10,000,000);
(ii) The Parent Group shall not have any liability for Adverse
Consequences for any breach of the representations or
warranties under Section 5.03(a)(i) of this Agreement and
Section 5.03(a)(i) of the Asset Purchase Agreement unless and
until the aggregate amount of all such Adverse Consequences
relating thereto for which the Parent Group would, but for
this Section 5.03(b)(ii) or Section 5.03(b)(ii) of the Asset
Purchase Agreement, be required to indemnify York exceeds on a
cumulative basis a Basket Amount equal to Five Hundred
Thousand Dollars ($500,000), at which point, the Parent Group,
subject to the further terms, conditions and limitations of
this Agreement and the Asset Purchase Agreement, shall
indemnify York for all Adverse Consequences exceeding the
Basket Amount; and
25
(iii) the obligations to indemnify and hold York harmless shall
terminate as to each representation, warranty and covenant
when each such representation, warranty or covenant
terminates, provided, however, that such obligations to
indemnify and hold harmless shall not terminate with respect
to any item as to which York shall have, prior to the
expiration of the applicable period, previously made a claim
by delivering an indemnification notice pursuant to Section
5.04 and in compliance with the requirements therefor, but
only with respect to the content of, and on the basis set
forth in, such indemnification notice.
(c) Notwithstanding anything to the contrary in this Agreement or
the Asset Purchase Agreement, the limitations set forth in Sections 5.03(b)(i),
(ii) and (iii) above shall not apply to or otherwise limit in any manner the
obligations of Xxxxxxxx and Empire under Sections 5.03(a)(ii) and (iii) above.
5.04 NOTICE OF CLAIM FOR INDEMNIFICATION. No claim for
indemnification hereunder shall be valid unless notice of such claim is
delivered to the Parent Group (in the case of a claim by York) or to York (in
the case of a claim by the Parent Group) prior to or upon the date of expiration
of the representation, warranty or covenant pursuant to which such
indemnification is sought. Any such notice shall set forth in reasonable detail,
to the extent known by the person giving such notice, the facts on which such
claim is based and the estimated amount of Adverse Consequences resulting
therefrom.
5.05 MATTERS INVOLVING THIRD PARTIES. (a) If the Parent Group or
York receives notice or acquires knowledge of any matter which may give rise to
a claim by another Person and which may then result in a claim for
indemnification under this Article V, then (i) if such notice or knowledge is
received or acquired by the Parent Group, the Parent Group shall within twenty
(20) days notify York thereof, and (ii) if such notice or knowledge is received
or acquired by York, York shall within twenty (20) days notify the Parent Group
thereof; provided, however, that no delay in giving such notice shall diminish
any obligation under this Article V to provide indemnification unless (and then
solely to the extent that) the party from whom such indemnification is sought is
prejudiced. Thereafter, the party seeking indemnification (the "Indemnified
Party") shall deliver to the party from whom such indemnification is sought (the
"Indemnifying Party"), within five business days after the Indemnified Party's
receipt thereof, copies of all notices, correspondence and documents (including,
without limitation, court papers) received by the Indemnified Party relating to
the Third Party Claim.
(b) The Indemnifying Party shall have the right to defend against
such claim by another Person (the "Third Party Claim") with counsel of the
Indemnifying Party's choice reasonably satisfactory to the Indemnified Party so
long as (within thirty (30) days after the Indemnified Party has given notice of
the Third Party Claim to the Indemnifying Party) the Indemnifying Party notifies
the Indemnified Party that the Indemnifying Party will indemnify the Indemnified
Party from and against all Adverse Consequences the Indemnified Party may suffer
caused by, resulting from, arising out of or relating to such Third Party Claim
and the Indemnifying Party conducts the defense of the Third Party Claim
actively and diligently. Notwithstanding any acknowledgement made pursuant to
Section 5.05(b)(i), York shall continue to be entitled to assert any defense to
or limitation on its indemnification responsibility contained in Section 5.02.
(c) So long as the Indemnifying Party is conducting the defense of
the Third Party Claim in accordance with Section 5.05(b) hereof, (i) the
Indemnified Party may retain separate co-counsel at its sole cost and expense
and participate in the defense of the Third Party Claim, it being understood,
however, that the Indemnifying Party shall control such defense, and (ii) the
Indemnified Party shall not consent to the entry of any judgment or enter into
any settlement with respect to the Third Party Claim without the prior consent
of the Indemnifying Party. If the Indemnifying Party chooses to defend any Third
Party Claim, the Indemnifying Party shall have the right to control the defense,
compromise or settlement of
26
such matter, and all the parties hereto shall cooperate in the defense or
prosecution of such Third Party Claim. Such cooperation shall include the
execution of documents necessary to effectuate any reasonable institutional
controls that are required as part of a remedial action approved by a
Governmental Authority, retention and (upon the Indemnifying Party's request)
the provision to the Indemnifying Party of Records that are reasonably relevant
to such Third Party Claim, and making employees available on a mutually
convenient basis to provide additional information and explanation of any
material provided hereunder. Notwithstanding the foregoing, the Indemnifying
Party shall not compromise or settle any Third Party Claim without the consent
of the Indemnified Party, unless such compromise or settlement by the
Indemnifying Party involves only the payment of monetary damages by the
Indemnifying Party and includes a full release of the Indemnified Party from all
liability with respect to such Third Party Claim. If the Indemnifying Party,
within a reasonable time after receipt of an Indemnification Notice relating to
a Third Party Claim, chooses not to assume defense of a Third Party Claim or
fails to defend such Third Party Claim actively and diligently, the Indemnified
Party will (upon further notice) have the right to undertake the defense,
compromise or settlement of such Third Party Claim or consent to the entry of
judgment with respect to such Third Party Claim, on behalf of, and for the
account and risk of, the Indemnifying Party, and the Indemnifying Party shall
have no right to challenge the Indemnified Party's defense, compromise,
settlement or consent to judgment, subject to the limitations on the
Indemnifying Party's obligations pursuant to Section 5.02. The foregoing
notwithstanding, in the event that the Indemnifying Party chooses not to assume
defense of a Third Party Claim or fails to defend such Third Party Claim
actively and diligently, but later chooses to assume defense of such Third Party
Claim and gives notice to the Indemnified Party of such assumption, the
Indemnifying Party shall, effective concurrently with the notice, control such
defense, and the Indemnified Party shall not consent to the entry of any
judgment or enter into any settlement with respect to the Third Party Claim
without the prior consent of the Indemnifying Party.
5.06 EXCLUSIVE REMEDY. From and after the date hereof, the
indemnification provisions of this Article V shall be the sole and exclusive
remedy with respect to any and all claims relating to the subject matter of this
Agreement (or any related agreements, certificates and other documents, except
to the extent otherwise expressly set forth therein) and no other remedy shall
be had pursuant to any contract, misrepresentation, fraud or other tort theory
or otherwise by Xxxxxxxx or York and their respective officers, directors,
employees, agents, Affiliates, attorneys, consultants, successors and assigns,
all such remedies being hereby expressly waived to the fullest extent permitted
under applicable Law. Without limitation, the procedures set forth in this
Article V constitute the sole and exclusive remedy of Xxxxxxxx and York and
their Affiliates arising out of any breach or claimed breach of the
representations and warranties set forth in Article II and Article III made as
of the date of this Agreement relating to events occurring on or prior to the
date hereof that become known to Xxxxxxxx or York on, prior to or subsequent to
the date hereof. In furtherance of the foregoing, except with respect to the
rights of Xxxxxxxx under this Agreement, Xxxxxxxx hereby waives, from and after
the date hereof, to the fullest extent permitted under applicable Law, any and
all other rights, claims and causes of action it may have against York and its
Affiliates relating to the subject matter of this Agreement arising under or
based upon any federal, state, local or foreign Law or otherwise, including,
without limitation, such rights, claims and causes of action Xxxxxxxx may have
against York under any Environmental Law or Worker Safety Law (Statutory,
Regulatory Common Law or otherwise) or CERCLA.
ARTICLE VI
Definitions
As used herein the following terms have the following meanings:
"Adverse Consequences" shall mean all actions, suits, proceedings,
hearings, investigations, charges, complaints, claims, demands, injunctions,
judgments, orders, decrees, rulings, damages, dues, penalties, fines, costs,
amounts paid in settlement, liabilities, obligations, Taxes, Liens,
27
losses, expenses and fees, including court costs and reasonable attorneys' and
accountants' fees and disbursements.
"Affiliate" shall mean a Person who, directly or indirectly through
one or more intermediaries, controls, is controlled by, or is under common
control with, the Person specified.
"Agreement" shall have the meaning set forth in the preamble hereto.
"Asset Purchase Agreement" shall have the meaning set forth in the
Recitals.
"Basket Amount" shall have the meaning set forth in Section 5.02(b).
"Closing" shall mean the sale and purchase of the Purchased Stock
upon the signing of this Agreement.
"Code" shall mean the Internal Revenue Code of 1986, as amended.
"Confidential Information" includes information concerning the
following, as they relate to the Subsidiaries: sales, sales volume, sales
methods, sales proposals, customers and prospective customers, identity of
customers and prospective customers, identity of key purchasing personnel in the
employ of customers and prospective customers, amount or kind of customer's
purchases from the Subsidiaries, its sources of supply, its computer programs,
system documentation, special hardware, product hardware, related software
development, its manuals, formulae, processes, methods, machines, compositions,
ideas, improvements, inventions or other confidential or proprietary information
belonging to the Subsidiaries or relating to its affairs. Notwithstanding the
foregoing, the term "Confidential Information" shall not include information
reasonably required for or currently used in York's casket businesses, if used
in connection with the operation of the casket businesses, even though such
information may also be in the possession of or belong to one or more of the
Subsidiaries.
"Contracts" shall have the meaning set forth in Section 2.08.
"Debt Instruments" shall have the meaning set forth in Section 2.14.
"Designee" shall have the meaning set forth in Section 4.05(a).
"Disclosure Schedules" shall mean the disclosure schedules furnished
by York, York Bronze and OMC to Xxxxxxxx and containing all lists, descriptions,
exceptions, and other information and materials as are required to be included
therein pursuant to this Agreement and the Asset Purchase Agreement.
"Domain Names" shall have the meaning set forth in Section
2.11(a)(iv).
"Empire" shall have the meaning set forth in the preamble hereto.
"Empire Designee" shall have the meaning set forth in Section
4.05(a).
"Employee Benefit Plan" shall have the meaning set forth in Section
2.10(d)(i).
"Employee Pension Benefit Plan" shall have the meaning set forth in
ERISA Section 3(2).
"Employee Welfare Benefit Plan" shall have the meaning set forth in
ERISA Section 3(1).
28
"Employment Contracts" shall have the meaning set forth in Section
2.09.
"Environmental Laws" shall have the meaning set forth in Section
2.19.
"ERISA" shall mean the Employee Retirement Income Security Act of
1974, as amended.
"ERISA Affiliate" shall have the meaning set forth in Section
2.10(d)(iii).
"Excluded Assets" shall mean the York Bronze Real Property located
in Aiken, South Carolina and Portland, Oregon.
"Financial Statements" shall have the meaning set forth in Section
2.05.
"GAAP" shall have the meaning set forth in Section 2.05.
"Governmental Authority" shall mean any federal, state or local
court, administrative agency or commission or other governmental authority or
instrumentality except any of the same which regulate any antitrust laws.
"Indemnified Party" shall have the meaning set forth in Section
5.05(a).
"Indemnifying Party" shall have the meaning set forth in Section
5.05(a).
"Intellectual Property" shall have the meaning set forth in Section
2.11(a).
"Liability" whether or not capitalized, shall mean any liability
(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.
"Lien" shall mean any lien, mortgage, pledge, encumbrance, charge or
other security interest other than Permitted Liens.
"Liquidation" shall have the meaning set forth in Section 4.05(f).
"Material Adverse Effect" shall mean an event, occurrence, fact,
condition, change, development or effect that is materially adverse to the
business, property, financial condition or results of operations of the
Subsidiaries taken as a whole, or any other specified Person, excluding
specifically any such event, occurrence, fact, condition, change, development or
effect (a) resultant from changes in general economic or political conditions,
(b) resultant from changes generally applicable to companies engaged in
businesses or industries similar to those in which the specified Person is
engaged, (c) resultant from the announcement of this Agreement or the
transactions contemplated herein, (d) resultant from the announcement of any
other transaction or transactions among York or one or more of its Affiliates
and Xxxxxxxx or one or more of its Affiliates, (e) resultant from any other
transaction or transactions with respect to which York has prior to the date
hereof announced (whether generally or specifically) its intention to
investigate, evaluate or consummate, and (f) set forth in this Agreement or the
Disclosure Schedules.
"Xxxxxxxx" shall have the meaning set forth in the preamble hereto.
"Xxxxxxxx Group" shall have the meaning set forth in Section 4.04.
"Multiemployer Plan" shall have the meaning set forth in Section
2.10(d)(ii).
29
"OMC" shall have the meaning set forth in the Recitals.
"OMC Common Stock" shall have the meaning set forth in Section 1.01.
"OMC Equipment" shall have the meaning set forth in Section
2.07(b)(ii).
"OMC Equipment Instruments" shall have the meaning set forth in
Section 2.07(b)(v).
"OMC Intellectual Property" shall have the meaning set forth in
Section 2.11(a).
"OMC Products" shall have the meaning set forth in Section 2.11(a).
"OMC Purchased Shares" shall have the meaning set forth in Section
1.01.
"OMC Real Property" shall have the meaning set forth in Section
2.07(a)(ii).
"OMC Real Property Instruments" shall have the meaning set forth in
Section 2.07(a)(ii).
"OMC Registered Intellectual Property" shall have the meaning set
forth in Section 2.11(a).
"Parent Group" shall have the meaning set forth in Section 5.02(a).
"Patents" shall have the meaning set forth in Section 2.11(a)(i).
"PBGC" shall mean the Pension Benefit Guaranty Corporation.
"Permits" shall have the meaning set forth in Section 2.13(a).
"Permitted Liens" shall mean (i) liens in respect of pledges or
deposits under workers' compensation laws or similar legislation, carrier's,
landlord's, workmen's, warehousemen's, mechanic's, laborer's, materialmen's or
other similar liens or easements, covenants and encumbrances, if the obligations
secured by same are not then delinquent; (ii) liens for current ad valorem
Taxes, payments of which are not yet delinquent; (iii) liens relating to
accounts payable incurred in the ordinary course of business and consistent with
past practice; (iv) zoning and subdivision laws and regulations; and (v) such
imperfections of title which do not materially detract from the value or current
uses of the Real Property.
"Person" shall mean any individual, partnership, joint venture,
corporation, trust, unincorporated organization or government or any department
or agency thereof.
"Purchase Price" shall have the meaning set forth in Section 1.02.
"Purchased Stock" shall have the meaning set forth in Section 1.01.
"Real Property" shall mean, collectively, the York Bronze Real
Property, the OMC Real Property and the Sub 1 Real Property, together with any
and all buildings and other improvements located thereon.
"Registered Intellectual Property" shall have the meaning set forth
in Section 2.11(a).
"Reportable Event" shall have the meaning set forth in ERISA Section
4043.
"Sub 1" shall have the meaning set forth in the Recitals.
30
"Sub 1 Asset Transfer" shall have the meaning set forth in the
Recitals.
"Sub 1 Asset Transfer Agreements" shall mean the bills of sale,
assignments, deeds and other documents, agreements, instruments and certificates
executed and delivered in connection with the Sub 1 Asset Transfer.
"Sub 1 Common Stock" shall have the meaning set forth in Section
2.03(c)(i).
"Sub 1 Equipment" shall have the meaning set forth in Section
2.07(b)(iii).
"Sub 1 Equipment Instruments" shall have the meaning set forth in
Section 2.07(b)(vi).
"Sub 1 Intellectual Property" shall have the meaning set forth in
Section 2.11(a).
"Sub 1 Preferred Stock" shall have the meaning set forth in Section
2.03(c)(i).
"Sub 1 Products" shall have the meaning set forth in Section
2.11(a).
"Sub 1 Real Property" shall have the meaning set forth in Section
2.07(a)(iii).
"Sub 1 Real Property Instruments" shall have the meaning set forth
in Section 2.07(a)(iii).
"Sub 1 Registered Intellectual Property" shall have the meaning set
forth in Section 2.11(a).
"Sub 1 Stock" shall have the meaning set forth in Section
2.03(c)(i).
"Subsidiaries" shall have the meaning set forth in the Recitals.
"Subsidiary Intellectual Property" shall have the meaning set forth
in Section 2.11(a).
"Subsidiary Permits" shall have the meaning set forth in Section
2.13(a).
"Subsidiary Products" shall have the meaning set forth in Section
2.11(a).
"Tax" or "Taxes" shall mean any United States Federal, state, local,
or foreign income, gross receipts, license, payroll, employment, excise,
severance, stamp, occupation, premium, environmental (including taxes under Code
Section 59A), customs duties, capital stock, franchise, profits, withholding,
social security (or similar), unemployment, disability, real property, personal
property, sales, use, transfer, registration, value added, alternative minimum,
estimated or other tax of any kind whatsoever, including any interest, penalty
or addition thereto, whether disputed or not.
"Tax Return" shall mean any return, declaration, report, claim for
refund or information return or statement relating to Taxes, including any
schedule or attachment thereto, and including any amendment thereof.
"Third-Party Claim" shall have the meaning set forth in Section
5.05(b) hereof.
"Trademarks" shall have the meaning set forth in Section 2.11(a)(v).
"Transaction Documents" shall mean this Agreement, the License
Agreement, the Preferred Provider Agreement, the Asset Purchase Agreement and
the Sub 1 Asset Transfer Agreements.
31
"URLs" shall have the meaning set forth in Section 2.11(a)(iii).
"Worker Safety Laws" shall have the meaning set forth in Section
2.19.
"York" shall have the meaning set forth in the preamble hereto.
"York Bronze" shall have the meaning set forth in the Recitals.
"York Bronze Common Stock" shall have the meaning set forth in
Section 1.01.
"York Bronze Equipment shall have the meaning set forth in Section
2.07(b)(ii).
"York Bronze Equipment Instruments" shall have the meaning set forth
in Section 2.07(b)(iv).
"York Bronze Intellectual Property" shall have the meaning set forth
in Section 2.11(a).
"York Bronze Products" shall have the meaning set forth in Section
2.11(a).
"York Bronze Purchased Shares" shall have the meaning set forth in
Section 1.01.
"York Bronze Real Property" shall have the meaning set forth in
Section 2.07(a)(i).
"York Bronze Real Property Instruments" shall have the meaning set
forth in Section 2.07(a)(i).
"York Bronze Registered Intellectual Property" shall have the
meaning set forth in Section 2.11(a).
"York Designee" shall have the meaning set forth in Section 4.05(a).
"York's knowledge" and similar phrases shall mean the actual
personal knowledge of any of Xxxxxx Xxxxxxxx, Xxxxxxx Xxxxx, Xxxxxx Xxxxxx,
Xxxxxxx Xxxxx, Xxxxxx Xxxxxxxxxx or Xxxxx Xxxx.
ARTICLE VII
Miscellaneous
7.01 FURTHER ASSURANCES. From time to time at the request of the
other party hereto and without further consideration, Xxxxxxxx, Empire and York
will execute and deliver such further instruments of conveyance and transfer as
the other party may reasonably request in order to consummate the transactions
contemplated herein.
7.02 EXPENSES. York will pay from the proceeds of sale all costs and
expenses attributable to the performance of and compliance with all agreements
and conditions contained in this Agreement to be performed or complied with by
York or to be performed or complied with by the Subsidiaries prior to the
Closing, including, without limitation, all accounting and legal fees and
expenses of York and of each of the Subsidiaries accrued prior to the Closing.
Xxxxxxxx and Empire will pay all costs and expenses attributable to the
performance of and compliance with all agreements and conditions contained in
this Agreement to be performed or complied with by Xxxxxxxx and Empire or to be
performed by the Subsidiaries after the Closing, including, without limitation,
all accounting and legal fees and expenses of Xxxxxxxx, Empire and of each of
the Subsidiaries accrued after the Closing.
32
7.03 GOVERNING LAW. This Agreement shall be governed by and
construed and enforced in accordance with the laws of the Commonwealth of
Pennsylvania.
7.04 ENTIRE AGREEMENT; MODIFICATION; WAIVER. This Agreement,
including the exhibits, schedules and appendices hereto, constitutes the entire
Agreement among the parties hereto pertaining to the subject matter hereof and
supersedes all prior agreements, understandings, negotiations and discussions,
whether oral or written, of the parties and there are no warranties,
representations or other agreements, express or implied, made by any party to
any other party in connection with the subject matter hereof except as
specifically set forth herein or in documents delivered pursuant hereto. To the
fullest extent permitted by law, unless otherwise expressly provided for herein,
no supplement, modification, waiver or termination of this Agreement shall be
binding unless executed in writing by the party to be bound thereby. No waiver
of any provision of this Agreement shall be deemed or shall constitute a waiver
of any other provision hereof (whether or not similar), nor shall such waiver
constitute a continuing waiver unless otherwise expressly provided.
7.05 NOTICES. All notices, demands, claims, requests, undertakings,
consents, opinions and other communications which may or are required to be
given hereunder or with respect hereto shall be in writing, shall be given
either by personal delivery or by mail, facsimile transmission (with
confirmation of receipt), telegraph, telex or similar means of communication,
and shall be deemed to have been given or made when delivered, if personally
delivered, and otherwise when received, addressed to the respective parties as
follows:
If to Xxxxxxxx or to Empire:
Xxxxxxxx International Corporation
Two Xxxxxxxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
Attn:Xxxxxx Xxxxx, CFO
Facsimile: 000-000-0000
With a copy which shall not constitute notice to:
Xxxx Xxxxx LLP
Attn:Xxxxxxxx X. Xxxxxxx, Esq.
000 Xxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
Facsimile: 000-000-0000
If to York :
The York Group, Inc.
0000 Xxxx Xxxxxxx
Xxxxx 000
Xxxxxxx, XX 00000
Attn:Legal Department
Facsimile: 000-000-0000
33
With a copy which shall not constitute notice to:
Xxxxx Xxxxxxx & Xxxx LLP
Attn:Xxxxx X. Xxxxxx, Esq.
3400 Chase Tower
000 Xxxxxx Xxxxxx
Xxxxxxx, XX 00000
Facsimile: 000-000-0000
7.06 COUNTERPARTS. This Agreement may be executed in as many
counterparts as may be deemed necessary and convenient, and by the different
parties hereto on separate counterparts, each of which, when so executed, shall
be deemed an original, but all such counterparts shall constitute but one and
the same instrument.
7.07 MATTERS OF CONSTRUCTION, INTERPRETATION AND THE LIKE.
(A) CONSTRUCTION. Xxxxxxxx, Empire and York have participated
jointly in the negotiation and drafting of this Agreement. If an ambiguity or
question of intent or interpretation arises, this Agreement shall be construed
as if drafted jointly by Xxxxxxxx, Empire and York and no presumption or burden
of proof shall arise favoring or disfavoring either Xxxxxxxx, Empire or York
because of the authorship of any of the provisions of this Agreement. Any
reference to any United States Federal, state, local or foreign statute or law
shall be deemed also to refer to all rules and regulations promulgated
thereunder, unless the context requires otherwise. Unless the context of this
Agreement otherwise requires, (a) words of any gender are deemed to include each
other gender; (b) words using the singular or plural number also include the
plural or singular number, respectively; (c) the terms "hereof," "herein,"
"hereby," "hereto," and derivative or similar words refer to this entire
Agreement; (d) the terms "Article" or "Section" refer to the specified Article
or Section of this Agreement; (e) the term "party" means, on the one hand,
Xxxxxxxx, on the other hand, York, (f) the word "including" means "including
without limitation"; and (g) all references to "dollars" or "$" refer to
currency of the United States of America. The exhibits and schedules specified
in this Agreement are incorporated herein by reference and made a part hereof.
The article and section headings hereof are for convenience only and shall not
affect the meaning or interpretation of this Agreement.
(B) SEVERABILITY. The invalidity or unenforceability of one or more
of the provisions of this Agreement in any situation in any jurisdiction shall
not affect the validity or enforceability of any other provision hereof or the
validity or enforceability of the offending provision in any other situation or
jurisdiction.
7.08 NO THIRD-PARTY BENEFICIARIES. This Agreement shall not confer
any rights or remedies upon any Person other than Xxxxxxxx, Empire, York, and
their respective successors and permitted assigns.
7.09 SUCCESSION AND ASSIGNMENT. This Agreement shall be binding upon
and inure to the benefit of the parties named herein and their respective
successors and permitted assigns. No party may assign this Agreement or any of
such party's rights, interests or obligations hereunder without the prior
written approval of the other parties hereto.
7.10 TIME OF ESSENCE. With regard to all dates and time periods set
forth or referred to in this Agreement, time is of the essence.
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7.11 NONCOMPETITION.
(a) NON-DISCLOSURE OF CONFIDENTIAL INFORMATION. York agrees to, and
to cause its Affiliates to, use commercially reasonable efforts to hold and
safeguard the Confidential Information known or held by such Person in trust for
the benefit of Xxxxxxxx, Empire and the Subsidiaries, and agrees that it shall
not, without the prior written consent of Xxxxxxxx or of Empire, misappropriate
or disclose or make available to anyone for use outside York at any time, any of
the Confidential Information.
(b) RESTRICTIONS ON COMPETITION. York covenants and agrees for
itself and on behalf of its direct and indirect subsidiaries (for so long as
they are subsidiaries of York) that for a period of two (2) years following the
Closing, such Persons shall not, anywhere in North America, engage, directly or
indirectly, whether as principal or as agent, consultant, shareholder (other
than as a shareholder of York Bronze and OMC until the Liquidation occurs), or
otherwise, alone or in association with any other Person, corporation or other
entity, in any Competing Business. For purposes of this Agreement, the term
"Competing Business" shall mean the business of manufacturing bronze urns,
bronze niche units, or bronze memorial or architectural products. Competing
Business shall exclude the use, marketing, distribution and sale of bronze urns,
bronze niche units and bronze memorial and architectural products.
(c) REMEDIES. In the event of a breach by any of York or its
Affiliates of the terms of this Section 7.11, Xxxxxxxx and/or Empire shall be
entitled, if it or they shall so elect, to institute legal proceedings to obtain
damages for any such breach, or to enforce the specific performance of this
Agreement by such Person and to enjoin such Person from any further violation of
this Agreement and to exercise such remedies cumulatively or in conjunction with
all other rights and remedies provided by law. York acknowledges, however, that
the remedies at law for any breach by it of the provisions of this Agreement may
be inadequate and that Xxxxxxxx and/or Empire shall be entitled to injunctive
relief against it in the event of any breach.
(d) AUTHORIZATION TO MODIFY RESTRICTIONS. It is the intention of the
parties that the provisions of Section 7.11 hereof shall be enforceable to the
fullest extent permissible under applicable law, but that the unenforceability
(or modification to conform to such law) of any provision or provisions hereof
shall not render unenforceable, or impair, the remainder thereof. If any
provision or provisions hereof shall be deemed invalid or unenforceable, either
in whole or in part, this Agreement shall be deemed amended to delete or modify,
as necessary, the offending provision or provisions and to alter the bounds
thereof in order to render it valid and enforceable.
[Signature page to follow]
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IN WITNESS WHEREOF, the parties hereto have duly executed this Stock
Purchase Agreement or have caused this Stock Purchase Agreement to be duly
executed as of the date first above written.
XXXXXXXX INTERNATIONAL CORPORATION
By
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Title
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EMPIRE STOCK CORP.
By
-------------------------------------
Title
----------------------------------
THE YORK GROUP, INC.
By
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Title
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36
