EXHIBIT 2.1
PURCHASE AND SALE AGREEMENT
On this 6th day of October, 1997, but to be effective as of
the 1st day of September, 1997, Remediation Technologies, Inc., a
Delaware corporation ("RETEC"), RETEC THERMAL, INC., a Delaware
corporation ("Seller"), TETRA Technologies, Inc., a Delaware
corporation ("TETRA") and TETRA THERMAL, INC., a Delaware
corporation ("Buyer"), hereby act and agree as follows:
WITNESSETH:
WHEREAS, Seller is a wholly-owned subsidiary of RETEC;
WHEREAS, Buyer is a wholly-owned subsidiary of TETRA;
WHEREAS, Seller and Buyer formed RETEC/TETRA, L.C. (the
"LLC") effective as of August 1, 1992 pursuant to the Formation
Agreement and Regulations of the LLC by and between Seller,
Buyer, TETRA and RETEC (the "Formation Agreement");
WHEREAS, Seller and RETEC desire to sell to Buyer and Buyer
and TETRA desire to purchase from Seller all of Seller's
interests in the LLC and all Projects, all on the terms and
conditions hereinafter set forth.
NOW, THEREFORE, in consideration of the mutual covenants,
conditions, and agreement hereinafter provided, the parties agree
as follows:
I. Definitions
Capitalized terms not otherwise defined herein shall have
the meanings set forth in the Formation Agreement.
II. Purchase and Sale of Limited Liability Company Interest
2.1 Subject to and upon the terms and conditions of this
Agreement, Seller hereby agrees to transfer, sell and assign to
Buyer and Buyer hereby agrees to purchase from Seller all of
Seller's right, title and interest in and to Seller's Limited
Liability Company Interest in the LLC (including all of Seller's
interests in all Projects).
2.2 The base purchase price ("Base Purchase Price") is
US$8,825,490, subject to adjustment as provided in Section 2.4
below.
2.3 Buyer shall assume certain of the liabilities of the
LLC, and defend RETEC and Seller against claims arising out of
the operations of the LLC, or its successors, pursuant to an
Assignment and Assumption Agreement (the "Assumption Agreement")
in the form attached hereto as Exhibit 2.3.
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2.4 If, within six (6) months after the Closing Date, Buyer
or any affiliated entity of Buyer (including the LLC or TETRA)
enters into any agreement under which any such party is committed
to sell to Scaltech, Inc. 50% or more of the outstanding capital
stock of Buyer, or of the Limited Liability Company Interests of
the LLC, or of their successors, or of their assets, or merge or
consolidate the Buyer, the LLC, or their successors, to or with
Scaltech, Inc. (the "Acquiring Entity"), or upon the occurrence
of a similar event, such that the total valuation of the equity
or assets of the Buyer, the LLC or their successors in any such
sale, merger or consolidation or similar event (the "Sale
Valuation") exceeds the sum of twice the Base Purchase Price plus
equity contributions to the LLC from TETRA after the Closing Date
(such sum shall be referred to herein as the "Adjusted
Valuation"), the purchase price of this transaction will be
subject to adjustment as follows. In this circumstance, Buyer
will pay to Seller, as additional purchase price ("Additional
Purchase Price"), 50% of the amount calculated by subtracting
from the Sale Valuation the Adjusted Valuation. For example, if
in such six month period any Acquiring Entity purchased the LLC
from TETRA for $20,000,000 and TETRA had contributed an
additional $2,000,000 in equity to the LLC, the Additional
Purchase Price owed to Seller will be $250,000.
2.5 Upon completion of the closing as set forth in section
3.2, this Agreement shall operate as an acknowledgment and
agreement of the parties hereto that, after the Closing Date, no
ongoing rights or obligations of any kind exist between or among
TETRA, Seller, RETEC, Buyer and/or the LLC under the Formation
Agreement or any agreement or document referenced in or at any
time attached to the Formation Agreement, or under any agreement
relating to borrowings of the LLC, or any other agreement,
document, instrument or certificate entered into or delivered by
a party, except as set forth in this Purchase and Sale Agreement,
the Assumption Agreement or other agreement or instrument to be
delivered pursuant to this Purchase and Sale Agreement.
III. The Closing; Payment of Purchase Price
3.1 The closing is being held at the offices of the LLC on
the date hereof (the "Closing Date").
3.2 At the closing:
(i) Buyer shall pay to Seller the amount of US$8,825,490 by
wire transfer of good funds to the account designated
by Seller;
(ii) Seller shall deliver to Buyer a certificate
representing Seller's Limited Liability Company
Interest in the LLC, duly endorsed for transfer to
Buyer.
1PAGE
(iii) The parties each shall deliver to the other an executed
Assumption Agreement in the form attached hereto as
Exhibit 2.3.
(iv) There shall be delivered to RETEC and Seller a written
statement from the Texas Commerce Bank releasing each
of RETEC and Seller from any Guaranty of the payment by
the LLC of any debt or obligation owed by the LLC,
TETRA or Buyer to the Texas Commerce Bank or any of its
affiliates and waiving any claim against RETEC or
Seller for payment of the debts or obligations of the
LLC, TETRA or Buyer.
(v) RETEC and Seller shall cause all of its employees who
hold any offices as members of the Managing Board,
Managers or officers of the LLC to submit written
resignations of such offices and shall deliver such
written resignations to Buyer.
3.3 If Additional Purchase Price is owed to Seller, Buyer
will pay such amount by cashier's check or wire transfer at such
time, or times as Buyer receives payment from the Acquiring
Entity. If the Acquiring Entity pays in installments, Buyer will
pay Seller promptly upon receipt of each installment an amount
calculated by multiplying the percentage of the total amount owed
by the Acquiring Entity represented by the installment times the
Additional Purchase Price.
IV. Representations and Warranties
4.1 RETEC and Seller, jointly and severally, represent and
warrant to TETRA and Buyer that, as of the date hereof, other
than as set forth in the Disclosure Schedule attached as Exhibit
4.1:
(i) Each is a corporation duly formed and validly existing
under the laws of its jurisdiction of incorporation and
has all requisite corporate power and authority to own,
lease and operate its properties, to carry on its
business as presently conducted, and to consummate the
transactions contemplated hereby.
(ii) The execution and delivery by Seller and RETEC of this
Agreement and the Assumption Agreement and the
performance by each of them of their respective
obligations under each such Agreement have been duly
and validly authorized by all necessary corporate
action on each of their parts, and this Agreement and
the Assumption Agreement is the valid and binding
obligation of Seller and RETEC, enforceable against
each of them in accordance with its terms, except as
may be limited by applicable bankruptcy, insolvency and
creditor rights laws generally.
PAGE
(iii) No agent, broker, person or firm acting on their behalf
or under their authority is or will be entitled to a
financial advisory fee, brokerage commission, finder's
fee or like payment in connection with any of the
transactions contemplated hereby.
(iv) Seller has good title to its 50% Limited Liability
Company Interest and its 50% interests in all Projects
and said Limited Liability Company Interest and
interests in the Projects are free and clear of all
security interests, liens, pledges, claims, charges,
escrows, encumbrances, options, rights of first
refusal, mortgages, indentures, or any other interests
of other parties.
(v) There are no suits, actions, or administrative,
arbitration or other proceedings or governmental
investigations pending or, to the best of the knowledge
of Seller or RETEC, threatened against either of them
with respect to the business of the LLC or any of the
transactions contemplated hereby, or against Seller's
Limited Liability Company Interest or the LLC.
(vi) There are no liens, security interests, claims,
obligations or encumbrances on or with respect to any
portion of any of the capital or other assets
contributed to the LLC by RETEC or Seller;
(vii) Neither RETEC nor Seller have created any obligation,
direct or contingent, on the part of the LLC not known
to and approved by a senior operating officer of the
LLC or the Managing Board;
(viii) None of the representations or warranties made by RETEC
and Seller in this Agreement or in connection with the
transactions contemplated hereby, contains or will
contain any untrue statement of a material fact or
omits to state or will omit to state any material fact
necessary to make any statement or fact contained
herein not misleading.
(ix) Each of RETEC and Seller has the right, power and
authority to execute and deliver this Agreement and the
Assumption Agreement, to consummate the transactions
contemplated hereby, and to perform its obligations
hereunder. The execution, delivery and performance of
this Agreement and the Assumption Agreement and the
consummation of the transactions contemplated hereby do
not and will not require the consent or approval of any
person or entity whose approval has not been obtained.
(x) Seller's name formerly was "Motec, Inc.", and said name
was changed to RETEC Thermal, Inc. by appropriate
corporate action.
3PAGE
4.2 Buyer and TETRA, jointly and severally, represent and
warrant to Seller and RETEC that, as of the date hereof, other
than as set forth in the Disclosure Schedule attached as Exhibit
4.2:
(i) Each is a corporation duly formed and validly existing
under the laws of its jurisdiction of incorporation and
has all requisite corporate power and authority to own,
lease and operate its properties, to carry on its
business as presently conducted, and to consummate the
transactions contemplated hereby.
(ii) The execution and delivery by Buyer and TETRA of this
Agreement and the Assumption Agreement and the
performance by each of them of their respective
obligations under each such Agreement have been duly
and validly authorized by all necessary corporate
action on each of their parts, and this Agreement and
the Assumption Agreement is the valid and binding
obligation of Buyer and TETRA, enforceable against each
in accordance with their terms, except as may be
limited by applicable bankruptcy, insolvency and
creditor rights laws generally.
(iii) No agent, broker, person or firm acting on their behalf
or under their authority is or will be entitled to a
financial advisory fee, brokerage commission, finder's
fee or like payment in connection with any of the
transactions contemplated hereby.
(iv) There are no suits, actions, or administrative,
arbitration or other proceedings or governmental
investigations pending or, to the best of their
knowledge, threatened against any of the transactions
contemplated hereby.
(v) None of the representations or warranties made by TETRA
and Buyer in this Agreement or in connection with the
transactions contemplated hereby, contains or will
contain any untrue statement of a material fact or
omits to state or will omit to state any material fact
necessary to make any statement or fact contained
herein not misleading.
PAGE
(vi) Each of TETRA and Buyer has the right, power and
authority to execute and deliver this Agreement and the
Assumption Agreement, to consummate the transactions
contemplated hereby, and to perform its obligations
hereunder and under the Assumption Agreement. The
execution, delivery and performance of this Agreement
and the Assumption Agreement and the consummation of
the transactions contemplated hereby do not and will
not require the consent or approval of any person or
entity whose approval has not been obtained.
V. Post-Closing Covenants
5.1 TETRA and Buyer agree to use reasonable efforts to
cause the name of the LLC to be changed as soon as practical
following the Closing Date, but in no event more than 90 days
thereafter, to eliminate the word "RETEC" from the name;
provided, however, that TETRA and Buyer shall not be required to
effect such name change with respect to any permits, licenses or
other legal authorizations currently in effect.
5.2 RETEC hereby grants TETRA and Buyer the right to
continue to use the name "RETEC" as part of the LLC name for a
period of up to 90 days following the Closing Date.
5.3 From time to time hereafter, at TETRA's or Buyer's
request and without further consideration, Seller and RETEC will
execute and deliver such other and further instruments of
conveyance, assignment, transfer and consent, and take such other
actions, as TETRA may reasonably request for the more effective
conveyance and transfer of Seller's ownership interest in the LLC
and the Projects.
5.4 (a) Except as otherwise set forth herein, for a period
of 36 months after the closing date (the "Noncompete Period"),
Seller, RETEC, Thermo Remediation, Inc. and Thermo TerraTech,
Inc. (the "Selling Group") shall not, and such persons or
entities shall cause their respective subsidiaries to not, engage
in or have any financial interest in any of the following
business areas in competition with the business of the LLC on a
worldwide basis:
(i) the provision of Thermal Desorption Systems and
services;
(ii) the provision of Xxxxx Prep Systems for oily
wastes in petroleum refineries;
(iii) the provision of dry and liquid Waste-Derived Fuel
Systems for oily wastes in petroleum refineries;
(iv) the provision of Slop Oil treatment and/or recycle
systems and services in petroleum refineries;
5PAGE
(v) the provision of wastewater bio-solids dewatering
in petroleum refineries;
(vi) treatment of steel industry mill scale and mill
sludge.
(b) Except as otherwise set forth herein, during the
Noncompete Period the Selling Group shall not, and such persons
or entities shall cause their respective subsidiaries to not:
(i) engage in any business relationship with or have any
financial interest in Cascade Separations, Inc. which relates to
the membrane separations technology licensed to it and owned by
Bend Research, Inc. of Bend, Oregon and Xxx Xxxxx, Inc. of
Albany, Oregon, provided that this prohibition shall no longer
apply in the event the LLC has not entered into an agreement to
license or acquire such membrane separations technology from Bend
Research, Inc. or Cascade within six months of the effective date
of this Agreement; and provided further that if the LLC abandons
efforts to license or acquire such membrane separations
technology from Cascade or Bend Research, Inc., Buyer or the LLC
shall give prompt written notice thereof to the Selling Group.
(ii) engage in vegetable oil and nickel recovery from
filtering clays using the methods or processes claimed in patent
No.5,599,376, Process and Equipment to Reclaim Reusable Products
from Edible Oil Process Waste Stream.
(iii) engage in any business relationship with or have any
financial interest in AKJ Industries of Easton, Maryland,
provided that this prohibition shall no longer apply in the event
the LLC has not entered into an agreement to acquire AKJ
Industries or the assets of AKJ Industries within six months of
the effective date of this Agreement; and provided further that
if the LLC abandons efforts to acquire AKJ Industries or its
assets, Buyer or the LLC shall give prompt written notice thereof
to the Selling Group.
(c) Notwithstanding the foregoing, Buyer and TETRA
acknowledge and agree for themselves and on behalf of the LLC
that:
(i) The Selling Group is engaged in, among others, the
business of providing Remediation Services and this
Section 5.4 shall not be construed in any manner as
prohibiting members of the Selling Group from
continuing to engage in such businesses. However, if
during the Noncompete Period the Selling Group desires
to provide Remediation Services using Thermal
Desorption Systems at any active industrial facility,
the Selling Group agrees to purchase or lease such
systems from the LLC, and the LLC agrees to sell or
lease such systems at reasonable rates and terms to be
PAGE
negotiated in good faith by both parties, except that
the LLC shall not be required to sell or lease such
Systems if the LLC is already engaged in the
treatment/recycle of As-Generated Wastes at the active
industrial facility at which the Selling Group desires
to employ the Thermal Desorption System;
(ii) The provision by the Selling Group of their customary
consulting services which may involve analysis and
assessment on behalf of clients of Thermal Desorption
Systems and services or other means to accomplish the
services described in (a) above shall not be in
violation of this Section 5.4;
(iii) ThermoEurotech, N.V., a Netherlands company of which
Thermo TerraTech is a part owner, is a waste-oil
processor employing a variety of technologies
(including but not necessarily limited to
centrifugation, decanting, distillation, pyrolysis, and
Thermal Desorption) to reprocess high-calorific waste
streams (including but not necessarily limited to Slop
Oil, oil-based drilling muds, and a variety of other
organic sludges) from various sources (including but
not necessarily limited to petroleum refineries, tanker
terminals, Used Oil distributors and processors,
industrial facilities, and municipalities) at a
regional facility located in the Netherlands. In
addition, ThermoEurotech provides consulting,
engineering, and Remediation Services in Europe. It is
agreed that this Section 5.4 shall not apply to any
business conducted by ThermoEurotech or its successors
outside of North and South America.
(iv) RETEC is engaged in the following businesses:
- Treatment of petroleum refinery wastewaters via
the design, construction, installation,
supervision and operation of refinery wastewater
treatment plants;
- Treatment of petroleum refinery wastewaters,
including groundwater, surface water, and
recovered product from surface and subsurface
remediation, using biological and
physical-chemical treatment processes, including
methods for wastewater bio-solids dewatering;
- Treatment of petroleum refinery As-Generated
Wastes from refinery Slop Oil systems, using
biological processing, not including Thermal
Desorption Systems, Xxxxx Prep Systems or Waste
Derived Fuel Systems.
7PAGE
It is agreed that this Section 5.4 shall not apply to
the conduct of such business by RETEC or its
successors.
(v) ThermoFluids, Inc. is a subsidiary of Thermo
Remediation, Inc. and its business includes the
testing, collection, transport and storage of various
oil-containing residuals, including Used Oil, oily
wastewater, used oil filters, oily sludges, and other
petroleum-contaminated solid wastes for treatment and
processing at local or regional facilities to which
such materials are transported from the sites at which
they were generated. The marketing and sale of fuel
and fuel products derived from these materials is an
important part of ThermoFluid's business.
ThermoFluid's business also includes petroleum product
tank clean-out operations, and the collection,
transport, storage, processing, treatment, disposal,
marketing, sale and/or recycling of products
encountered during these operations. ThermoFluids also
brokers petroleum fuels of all types. It is agreed
that this Section 5.4 shall not apply to the conduct of
such businesses by ThermoFluids or its successors,
provided however, that in the conduct of such
businesses ThermoFluids shall not employ or provide
Thermal Desorption Systems or services, Xxxxx Prep
Systems or services or Waste Derived Fuel Systems or
services for the treatment of and/or recycle of Slop
Oil generated at petroleum refineries, whether on-site
at the refinery or at a regional facility, nor shall
ThermoFluids employ or provide on-site (at a petroleum
refinery) centrifugation services for Slop Oil
generated at petroleum refineries.
(d) For purposes of this Section 5.4, the terms set forth
below shall have the following meanings:
"Remediation Services" means (i) the treatment of
Remediation Wastes at active and inactive industrial or
government owned sites; and (ii) the treatment of
Remediation Wastes at local or regional facilities to which
such Wastes are transported from the sites at which they are
or were generated, including in the case of both (i) and
(ii) above the use of Thermal Desorption Systems in
connection therewith.
"Remediation Wastes" means previously As-Generated Wastes,
typically including media (groundwater, surface water,
soils, and sediments) and debris, which have been land
applied, such as in, but not limited to, pits, ponds and
lagoons.
"As-Generated Wastes" means currently generated wastes or
residuals from a processing or manufacturing operation,
PAGE
typically to be treated on-site immediately after a brief
(i.e., 90 days or less or as defined by applicable
regulatory authority) storage period.
"Slop Oil" is defined in the normal petroleum refinery
context as crude and processed oil collected from storage
tanks, wastewater systems and various unit operations within
the refinery and associated facilities such as tanker
unloading facilities, etc.
"Used Oil" means any oil that has been refined from crude
oil, or any synthetic oil, that has been used and as a
result of such use is contaminated by physical or chemical
impurities.
"Thermal Desorption" means a process technology for control
of organics in solids and sludges, including watery solids
and sludges, wherein organic compounds are removed through
thermal volatilization and steam stripping, with indirect
heat transfer primarily employed in the desorber, rather
than combustion.
"Thermal Desorption System" means a system for operation and
use of the Thermal Desorption process, comprised of four
primary subsystems - an input materials feed system, a
thermal desorber, an output solids handling system and an
output gas handling system.
"Xxxxx Prep System" means a system for the separation of
organics, water and solids from oily solids and sludges,
including watery solids and sludges, and subsequent particle
sizing of the solids in either an aqueous or hydrocarbon
based mixture for injection into one of several thermal
cracking operations in a petroleum refinery.
"Waste Derived Fuel System" means a system for the
separation of organics, water and solids from oily solids
and sludges, including watery solids and sludges, and
subsequent drying of the solids and sludges to produce a
"Dry Fuel" and/or particle sizing the solids and mixing it
with liquid hydrocarbons to produce a "Wet Fuel" for use as
a commercial fuel, typically, but not limited to, cement
kilns.
(d) The listing of business areas in paragraph (a) above is
intended solely for purposes of circumscribing The Selling
Group's obligations not to compete with the LLC and shall not be
deemed or construed to limit or in any way constrain the
engagement or entry by the LLC into any business or commercial
endeavor.
5.5 Intentionally omitted
5.6 RETEC and Seller covenant and agree that:
9PAGE
(i) Buyer, TETRA and the LLC are hereby granted a perpetual
royalty-free license to use within the LLC Field of
Use, including the right to sublicense within the LLC
Field of Use; and
(ii) after the Closing Date RETEC and Seller shall not make
any claim for damages against Buyer, TETRA or the LLC
based on the use by Buyer, TETRA or the LLC within the
LLC Field of Use of, nor will RETEC or Seller seek to
enjoin Buyer, TETRA or the LLC from using within the
LLC Field of Use,
any data, information, methods, processes, designs, drawings,
software, inventions, discoveries or the practice of any patent
(a) that existed prior to the Closing Date, (b) in which RETEC or
Seller has an ownership interest, (c) that RETEC or Seller
disclosed to the LLC prior to the Closing Date and (d) that
relates to operations within the LLC Field of Use. As used
herein the term LLC Field of Use shall mean the design,
manufacture, operation and sale of Thermal Desorption Systems and
Services, Xxxxx Prep Systems and Services and Waste Derived Fuel
Systems and Services.
5.7 TETRA and Buyer covenant and agree that, except for the
proprietary rights of the LLC listed on Exhibit 5.7 attached
hereto (with respect to which RETEC and Seller shall have no
rights hereunder):
(i) The Selling Group is hereby granted a perpetual
royalty-free license to use within the RETEC Field of
Use, including the right to sublicense within the RETEC
Field of Use; and
(ii) after the Closing Date TETRA and Buyer shall not make
any claim for damages against the Selling Group based
on the use by the Selling Group or any of them of, nor
will TETRA or Buyer seek to enjoin the Selling Group or
any of them from using within the RETEC Field of Use,
any data, information, methods, processes, designs, drawings,
software, inventions, discoveries or the practice of any patent
(a) that existed prior to the Closing Date, (b) in which the LLC
has an ownership interest, including that conveyed by Buyer or
RETEC to the LLC under the Formation Agreement, (c) that the LLC
disclosed to RETEC or Seller prior to the Closing Date or that
was known to RETEC or Seller prior to the Closing Date, and (iv)
that relates to operations within the RETEC Field of Use. As
used herein the RETEC Field of Use shall mean the design,
manufacture, operation and sale of Thermal Desorption Systems and
Services to the extent the Selling Group is not precluded from
engaging in the provision of such Systems and Services pursuant
to the provisions of Section 5.4 hereof. TETRA and Buyer further
covenant and agree that each of them will take all action to
PAGE
ensure that the LLC will grant to the Selling Group a license on
the same terms as set forth in (i) above and that the LLC itself
will make no such claim for damages or seek to enjoin the Selling
Group or any of them from the exercise of any rights granted or
to be granted to the Selling Group pursuant to this Section 5.7.
5.8. (i) Each party will treat as confidential and not
disclose or use financial information relating to
the other parties and, in the case of Seller and
RETEC, to the LLC;
(ii) With respect to technical information,
(a) TETRA, Buyer and the LLC may use and disclose
the confidential technical information of RETEC
and Seller covered in Section 5.6 above within the
LLC Field of Use in accordance with their ordinary
practices for treatment of such confidential
information;
(b) The Selling Group may use and disclose the
confidential technical information of the LLC
covered in Section 5.7 above within the RETEC
Field of Use in accordance with their ordinary
practices for treatment of such confidential
information.
(iii) The above restrictions on disclosure and use of
confidential information of a party shall not
apply to information which the receiving party can
show by reasonable proof:
(a) was available to the public prior to the
receiving party's receipt of the information;
(b) becomes available to the public following the
receipt of the information through no fault of the
receiving party;
(c) was in the possession of the receiving party
prior to the receipt of the information from the
disclosing party and was not acquired by the
receiving party from a third party under a
confidential obligation or from the disclosing
party;
(d) has been developed by the receiving party as
a result of independent activities and without
access to the information of the disclosing party;
or
(e) has been released to the public through no
fault of the receiving party.
11PAGE
5.9 The above provisions of Sections 5.6 and 5.7 shall
inure to the benefit of and be binding on the successors to the
business of and the assignees of the parties hereto, as well as
to and on the affiliates of the parties hereto.
5.10 (a) RETEC and Seller shall furnish TETRA and Buyer
with all records regarding the operating assets and operations of
the business of the LLC that are in their possession, other than
financial information and information that RETEC and Seller
reasonably believe is already in the possession of the LLC, Buyer
or TETRA.
(b) Buyer and Seller shall, for a period of five years
from the date hereof, make available to the other for inspection
and copying during normal business hours, in connection with the
preparation of tax returns, tax audits and tax litigation related
to pre-closing periods, all tax records, and other retained
records or copies thereof in their possession relating to the LLC
and its business and operations for such pre-closing periods.
Notwithstanding the foregoing, Buyer and Seller may dispose of
such records provided that ninety days advance written notice of
intent to dispose is given to the other beforehand. Such notice
shall be delivered in accordance with the notice provisions set
forth in this Agreement and shall include a list of the records
to be disposed of, which shall describe each book, file or other
record accumulation being disposed in reasonable detail. Each
party shall have the opportunity, at its cost and expense, to
copy or remove, within such ninety day period, all or any part of
such tax records. For purposes of this section, tax records
include, without limitation, journal vouchers, cash vouchers,
general ledgers, material contracts, and authorizations for
expenditures (AFE's).
(c) For a period of eighteen months following the date
hereof, TETRA and Buyer shall provide RETEC and Seller with
reasonable access to the LLC's books and records to confirm at
RETEC's and Seller's sole cost and expense the accuracy of the
financial statements attached as Exhibit 5.11 hereto.
5.11 All agreements between the LLC, as one party, and
RETEC and/or Seller, as the other party, shall be immediately
terminated as of the Closing Date. RETEC, Buyer, TETRA and
Seller acknowledge and agree (i) that services to be performed
for consideration by RETEC for the LLC, TETRA and/or Seller after
the Closing Date, if any, will be set forth in a separate written
agreement on RETEC's and Seller's standard terms; and (ii) TETRA,
Buyer RETEC and Seller have performed such due diligence as they
have deemed necessary or appropriate in connection with the
transactions contemplated hereby, and have had the opportunity to
ask such questions regarding the operations of the LLC as they
desired and have received satisfactory answers with regard
thereto, and (iii) the financial statements of the LLC as of
August 31, 1997 and attached hereto as Exhibit 5.11 represent the
agreed financial statements of the LLC as of the effective date.
PAGE
5.12 Each party hereto has been represented by and will pay
all fees and expenses of all of its legal, financial and other
advisors that it has deemed necessary or desirable to engage in
connection with the transactions contemplated by this Agreement.
5.13 Except for using the agreed upon text set forth in
Exhibit 5.13, neither RETEC or Seller, on the one had, nor TETRA
or Buyer, on the other, will make any press release or public
announcement relating to this Agreement without the prior
approval of TETRA or RETEC, as the case may be.
5.14 TETRA and Buyer covenant and agree that as the
controlling entity of the LLC, or the successors to the LLC, they
will take the necessary actions to direct the LLC to perform
those actions required to be performed by the LLC hereunder and
not to take any action that the LLC is not to take according to
the terms of this Agreement. In the event of a sale of the
business of the LLC or its assets or of the Member Interests of
the LLC, or of a successor to the LLC controlled by TETRA or
Buyer, TETRA and Buyer will assure that the purchaser is bound by
the same obligations of TETRA and Buyer set forth in the
immediately preceding sentence with respect to the LLC or its
successor.
VI. Indemnification
6.1 Except as otherwise provided herein, TETRA and Buyer,
jointly and severally, hereby agree to indemnify, defend and hold
harmless RETEC and Seller from and against any liability, cost,
expense, claim, demand, cause of action, judgment, order, or
decree, and all associated fees, costs and expenses including
attorneys' fees, ("Liabilities") which is made or assessed
against RETEC or Seller or is paid or incurred by RETEC or Seller
which arise out of (i) the operations, debts or obligations of
the LLC at any time prior to or after the date hereof, (ii) any
breach of this Agreement; and (iii) any failure by the LLC or
Buyer to fully perform any defense obligation or to discharge and
pay all LLC Liabilities (as defined in the Assumption Agreement)
assumed by Buyer and the LLC under the Assumption Agreement.
Notwithstanding anything contained in this Agreement to the
contrary, Buyer does not indemnify or assume any liability of
Seller for taxes imposed on the Seller related to the LLC's
assets, business or operation for taxable periods or portions
thereof ending on or before the date hereof.
6.2 RETEC and Seller, jointly and severally, hereby agree
to indemnify, defend and hold harmless TETRA and Buyer from and
against any Liabilities paid or incurred by TETRA or Buyer which
arise out of (i) any breach of this Agreement by RETEC or Seller;
(ii) the breach by RETEC or Seller of their representations or
warranties under this Agreement, or (iii) any claims
that the provision by the LLC of Thermal Desorption Systems or
Services in the form or manner provided by the LLC as of or prior
13PAGE
to the effective date of this Agreement infringe U. S. Patents
4,990,237 or 5,269,906 (hereafter an "Infringement Claim"),
subject to the conditions and limitations set forth in the
following sentence. With respect to any claims by TETRA, Buyer
or the LLC for indemnification arising out of or relating to an
Infringement Claim, (A) RETEC and Seller shall be obligated to
pay at any time only one-half of amounts actually paid by TETRA,
Buyer and the LLC to third parties in the defense of such Claims,
in the settlement of such Claims, or to obtain a license under
said Patents, or as royalties under a license to use or practice
said Patents, (B) RETEC's and Seller's entire liability to
TETRA, Buyer and the LLC relating to the defense and settlement
of any Infringement Claim, and for costs incurred to obtain a
license under said Patents, shall be limited in the aggregate to
$250,000, (C) RETEC and Seller, and their designated counsel,
shall be given promptly copies of all correspondence and court
documents relating to any Infringement Claim and shall be
afforded reasonable advance opportunity to consult with TETRA,
Buyer, the LLC and its counsel regarding the defense and
settlement of any Infringement Claim, and (D) RETEC and Seller
shall have no obligation to defend or indemnify TETRA, Buyer, the
LLC or their successors against any claim for infringement by the
LLC or its successors of any other patents, copyrights, trade
secrets or other intellectual property.
6.3 If the LLC or any of the parties to this Agreement
shall receive notice of any claim or alleged claim asserting the
existence of a Liability as to which a party may be indemnified
hereunder, the party to be indemnified (the "Indemnified Party")
shall promptly notify the party
expected to defend and indemnify the Indemnified Party thereof,
setting forth in reasonable detail the basis on which such right
to defense and indemnity is asserted.
6.4 With respect to any suit, action, investigation, claim
or proceeding for which defense and indemnification is claimed by
the Indemnified Party, the Indemnified Party shall have the
right, but not the obligation, to participate at its own expense
in the defense thereof by counsel of its own choosing, but the
Indemnifying Party shall be entitled to control the defense
unless the Indemnified Party has relieved the Indemnifying Party
from liability with respect to the particular matter.
Regardless of whether the Indemnified Party elects to participate
in the defense, the Indemnifying Party shall reimburse the
Indemnified Party for its expenses of providing assistance at the
request of the Indemnifying Party, including, but not limited to,
attorneys' fees and investigation expenses. In the event the
Indemnifying Party shall fail timely to defend, contest or
otherwise protect against any suit, action, investigation, claim
or proceeding, the Indemnified Party shall have the right, but
not the obligation, to defend, contest or otherwise protect
against the same, and make any compromise or settlement thereof
and recover the entire cost thereof from the Indemnifying Party,
including but not necessarily limited to, attorneys' fees,
PAGE
disbursements and all amounts paid as a result of such suit,
action, investigation, claim or proceeding or the compromise or
settlement thereof.
6.5 Indemnification payments pursuant to this Article 6
which have been agreed to by the parties, or which shall have
been ordered paid by court order, which order is final and not
appealable, shall be immediately due and payable by the
Indemnifying Party.
VII. Miscellaneous
7.1 This Agreement comprises the entire agreement between
the parties hereto as to the subject matter hereof, and
supersedes all prior agreements and understandings between them
relating to the subject matter hereof. Each of TETRA and RETEC
may extend the time for, or waive the performance of, any of the
obligations of the other, waive any inaccuracies in the
representations or warranties of the other, or waive compliance
by the other with any of the provisions in this Agreement, but
only by an instrument in writing signed by the party granting
such extension or waiver.
7.2 Any notice to any party given pursuant to this
Agreement shall be given by telefax or recognized express courier
delivery service addressed, if to TETRA or Buyer, to it at 00000
0-00 Xxxxx, Xxx Xxxxxxxxx, XX 00000 (fax:(000) 000-0000),
Attention: Xxxxxxxx X. Xxxxxx, Executive Vice-President; if to
RETEC or Seller to it at 0 Xxxx Xxxx, Xxxxxxxxx Xxxxxx, Xxxxxxx,
XX 00000, Attention: Xxxxxx X. Xxxxxx, President (fax: (508)
000-0000). Any such address may be changed by a party by written
notice to the other party. Any notice shall be deemed delivered
when sent.
7.3 This Agreement is made and shall be construed in
accordance with the laws of the State of Texas.
7.4 In the event of any dispute between the parties arising
under this Agreement, the parties agree that (i) the state or
federal courts in and for the County of Xxxxxx, State of Texas,
shall have exclusive jurisdiction and venue to determine such
dispute(s) if such action is initiated by RETEC or Seller, and
(ii) the state or federal courts in and for the County of
Suffolk, State of Massachusetts shall have exclusive jurisdiction
and venue to determine such dispute(s) if such action is
initiated by TETRA or Buyer. Each party hereby waives any
objection to such jurisdiction and venue in any such court and
any claim that such forum is an inconvenient forum.
7.5 This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original for all
purposes. This Agreement shall inure to the benefit of and be
binding upon the successors and assigns of the parties hereto.
15PAGE
7.6 If any term or provision of this Agreement, or the
application thereof to any person or circumstance, shall to any
extent be invalid or unenforceable or in violation of applicable
law, such term or condition shall be deemed limited to the
extent, if any, to which it is valid and enforceable without
violation of law, and the remainder of the terms and provisions
of this Agreement and the application thereof to persons or
circumstances other than those as to which it is invalid or
unenforceable or in violation of law, shall not be affected
thereby, and each term and provision of this Agreement shall be
valid and enforced to the fullest extent permitted by law.
7.7 In accordance with and as permitted by Section 17.42 of
the Texas Deceptive Trade Practices Act, which is codified in
Chapter 17 of the Texas Business and Commerce Code, as amended
(the "DTPA"), TETRA and Buyer hereby irrevocably waive any and
all rights that either of them may have, now or in the future,
under the DTPA, other than any rights that it may have, now or in
the future, under Section 17.555 of the DTPA. TETRA and Buyer
hereby acknowledge that (i) Buyer is a wholly owned subsidiary of
TETRA, (ii) TETRA and Buyer are "business consumers" as that term
is used in the DTPA; (iii) TETRA, including Buyer, has assets of
$5 million or more according to its most recent financial
statement prepared in accordance with generally accepted
accounting principles; (iv) TETRA and Buyer have knowledge and
experience in financial and business matters that enables them to
evaluate the merits and risks of the transaction contemplated
hereby; and (v) TETRA and Buyer are not in a significantly
disparate bargaining position.
IN WITNESS WHEREOF, the parties have caused this Agreement
to be duly executed as of the day and year first written.
Remediation Technologies, Inc. TETRA Technologies, Inc.
By /s/ Xxxxxx X. Xxxxxx By /s/ Xxxxxxxx X. Xxxxxx
Its President Its Executive Vice President
Seller Buyer
By /s/ Xxxxxx X. Xxxxxx By /s/ Xxxxxxxx X. Xxxxxx
Its President Its Vice President
Exhibits to be Attached
Exhibit 2.3 Form of Assignment and Assumption Agreement
Exhibit 4.1 RETEC/Seller Disclosure Schedule
Exhibit 4.2 TETRA/Seller Disclosure Schedule
Exhibit 5.7 TETRA Intellectual Property
Exhibit 5.11 Financial Statements
Exhibit 5.13 Text of Press Release
PAGE
