PURCHASE AGREEMENT
PURCHASE AGREEMENT ("AGREEMENT") dated as of April 1, 1999, by and
among ACCURIDE VENTURES, INC., a Delaware corporation and wholly-owned
subsidiary of Accuride Corporation ("ACCURIDE SUB"), ACCURIDE CORPORATION, a
Delaware corporation ("ACCURIDE"), and XXXXXX ALUMINUM & CHEMICAL
CORPORATION, a Delaware corporation ("KAISER").
W I T N E S S E T H:
WHEREAS, Accuride, acting through Accuride Sub, and Kaiser formed AKW
General Partner L.L.C., a Delaware limited liability company (the "GENERAL
PARTNER"), to act as the general partner of AKW L.P., a Delaware limited
partnership (the "COMPANY"); Accuride Sub and Kaiser each own a fifty percent
(50%) membership interest in the General Partner; and Accuride Sub, Kaiser
and Accuride (in its capacity as guarantor of Accuride Sub) entered into a
Limited Liability Company Agreement dated as of May 1, 1997 (the "LIMITED
LIABILITY COMPANY AGREEMENT"), providing for the operation of the General
Partner and for certain rights and restrictions applicable to the members
thereof;
WHEREAS, Accuride Sub and Kaiser each own a forty-nine percent (49%)
limited partnership interest in the Company; the General Partner owns a two
percent (2%) partnership interest in the Company; and Accuride Sub, Kaiser,
the General Partner and Accuride (in its capacity as guarantor of Accuride
Sub) entered into the Limited Partnership Agreement of AKW L.P., dated as of
May 1, 1997 (the "LIMITED PARTNERSHIP AGREEMENT"), providing for the
operation of the Company and for certain rights and restrictions applicable
to the partners thereof;
WHEREAS, Accuride desires to purchase, and Kaiser desires to sell,
Xxxxxx'x fifty percent (50%) Interest (as defined in the Limited Liability
Company Agreement) in the General Partner and Xxxxxx'x forty-nine percent
(49%) Interest (as defined in the Limited Partnership Agreement) in the
Company (collectively, the "KAISER INTERESTS") upon the terms and subject to
the conditions of this Agreement, so that upon consummation of the
Transactions (as defined below), Accuride Sub and Accuride shall collectively
hold one hundred percent (100%) of the Interest (as defined in the Limited
Liability Company Agreement) in the General Partner and a ninety-eight
percent (98%) Interest (as defined in the Limited Partnership Agreement) in
the Company;
NOW, THEREFORE, the parties, intending to be legally bound hereby,
agree as follows:
ARTICLE I
DEFINITIONS
Capitalized terms used in this Agreement shall have the meanings set
forth below or in the Section of this Agreement referred to below:
"ACCURIDE" has the meaning given in the first paragraph hereof.
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"ACCURIDE ADMINISTRATIVE SERVICES AGREEMENT" means the Accuride
Administrative Services Agreement between Accuride and the Company dated as
of May 1, 1997.
"ACCURIDE SALES AND MARKETING AGREEMENT" means the Accuride Sales and
Marketing Agreement between Accuride and the Company dated as of May 1, 1997.
"ACCURIDE TECHNICAL SERVICES AGREEMENT" means the Accuride Technical
Services Agreement between Accuride and the Company dated as of May 1, 1997.
"ADDITIONAL PREMISES" has the meaning set forth in the Restated Lease.
"AFFILIATE" means, with respect to any Person, any other Person
directly or indirectly controlling, controlled by or under common control
with, such Person. Control of any Person shall consist of the power to
direct the management and policies of such Person whether through the
ownership of voting securities or by contract or otherwise and shall be
deemed to exist upon the ownership of securities entitling the holder thereof
to exercise more than 50% of the voting power in the election of directors
(or other similar positions) of such Person.
"AGREEMENT" has the meaning given in the first paragraph hereof.
"APPLICABLE LAW" means all applicable provisions of all constitutions,
treaties, statutes, laws (including, but not limited to, the common law),
rules, regulations, ordinances, codes or orders of any Governmental Authority
and of all orders, decisions, injunctions, judgments, awards and decrees or
consents of or agreements with any Governmental Authority.
"BUSINESS DAY" means any calendar day other than a Saturday or Sunday
or a day on which either state or national banks in the States of California,
Kentucky or New York are not open for the conduct of normal banking business.
"CASH ADJUSTMENT" has the meaning given in Section 3.4.
"CASH ADJUSTMENT STATEMENT" has the meaning given in Section 3.5.
"CLAIM" has the meaning given in Section 7.1.
"CLOSING" has the meaning given in Section 3.1.
"CLOSING DATE" has the meaning given in Section 3.1.
"CODE" means the Internal Revenue Code of 1986, as amended from time
to time, and any successor act thereto, and, to the extent applicable, any
Treasury Regulations promulgated thereunder.
"COMPANY" has the meaning given in the recitals.
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"COMPANY MATERIAL ADVERSE EFFECT" means any event, fact, effect or
change which, individually or in the aggregate, has, or is reasonably likely
to have, a material adverse effect on the condition (financial or otherwise),
business, prospects, results of operations, assets, liabilities or operations
of the Company taken as a whole.
"CONTRIBUTION AGREEMENT" means the Contribution Agreement among
Accuride, Kaiser, the Company and the General Partner dated as of May 1, 1997.
"DAILY RATE" shall be two and one-half percentage points over the one
month London Interbank Offered Rate as reported in The Wall Street Journal on
the date of this Agreement divided by three hundred sixty (360).
"ENVIRONMENTAL COMPLIANCE PLAN" has the meaning given in Section 6.3
of the Contribution Agreement.
"ERIE LEASE AGREEMENT" means the Lease Agreement between Kaiser and
the Company dated as of May 1, 1997.
"FORMATION AGREEMENTS" means the Contribution Agreement, the Limited
Liability Company Agreement, the Limited Partnership Agreement, the Interest
Purchase Agreement, the Erie Lease Agreement, the Accuride Administrative
Services Agreement, the Accuride Technical Services Agreement, the Kaiser
Technical Services Agreement, the Accuride Sales and Marketing Agreement, the
Xxxxxx Production Services Agreement, the Kaiser Administrative Services
Agreement and any other "Ancillary Agreements" (as defined in Article I of
the Contribution Agreement) entered into by Kaiser, Accuride, Accuride Sub,
the Company and/or the General Partner in connection with the transactions
contemplated by the Contribution Agreement.
"GENERAL PARTNER" has the meaning given in the recitals.
"GOVERNMENTAL AUTHORITY" means any nation or political subdivision
thereof, including any state, county or municipality; and any entity
exercising executive, legislative, judicial, regulatory or administrative
functions of or pertaining to any of the foregoing, including, without
limitation, any legislature, elected official, authority, agency, department,
board, commission, court, tribunal or instrumentality.
"GOVERNMENTAL AUTHORIZATIONS" has the meaning given in Section 4.3.
"GOVERNMENTAL ORDER" means any statute, rule, regulation, order,
judgment, injunction, decree, stipulation or determination enacted, issued,
enforced or entered by any Governmental Authority of competent jurisdiction.
"HSR ACT" means the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of
1976, as amended from time to time, and the regulations promulgated
thereunder.
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"INDEMNIFIED PARTY" has the meaning given in Section 7.2.
"INDEMNIFYING PARTY" has the meaning given in Section 7.2.
"INSURANCE POLICIES" has the meaning given in Section 4.8.
"INTEREST PURCHASE AGREEMENT" means the AKW L.P. Interest Purchase
Agreement dated as of May 1, 1997, between Accuride Sub and Kaiser.
"INTERIM PERIOD" has the meaning given in Section 3.4.
"JOINT VENTURE PRODUCTS" means (i) aluminum wheels 16" in diameter and
larger primarily for light, medium and heavy duty trucks, trailers and buses
(classes 1-8), although certain of such wheels may also be sold into the
automotive original equipment manufacturer market; (ii) tire molds for
automotive and light-medium-heavy truck applications, as to each of clauses
(i) and (ii) above, produced by forging, fabricating or casting for marketing
and sale worldwide, including without limitation in the original equipment
manufacturer market, after-market and repair and replacement markets and
(iii) such additional or different products as the Members Committee has
approved pursuant to Section 6.4 of the Limited Liability Company Agreement
prior to the Closing Date. Notwithstanding the foregoing, Joint Venture
Products shall not include (i) motorcycle wheels and wheel parts, (ii) wheel
centers for any applications, (iii) forged one piece wheel blanks sold to
other wheel manufacturers, and (iv) finished wheels for the automotive
aftermarket market currently produced or being contemplated for production by
Kaiser.
"KAISER" has the meaning given in the first paragraph hereof.
"KAISER ADMINISTRATIVE SERVICES AGREEMENT" means the Kaiser
Administrative Services Agreement between Kaiser and the Company dated as of
May 1, 1997.
"KAISER INTERESTS" has the meaning given in the recitals.
"KAISER MARKS" shall have the meaning give in Section 4.15.
"XXXXXX PRODUCTION SERVICES AGREEMENT" means the Xxxxxx Production
Services Agreement between Kaiser and the Company dated as of May 1, 1997.
"KAISER TECHNICAL SERVICES AGREEMENT" means the Kaiser Technical
Services Agreement between Kaiser and the Company dated as of May 1, 1997.
"KNOWLEDGE" means (i) with respect to Kaiser, the actual knowledge of
those officers and employees of Kaiser listed on SCHEDULE 1(a), and (ii) with
respect to Accuride and Accuride Sub, the actual knowledge of those officers
and employees of Accuride listed on SCHEDULE 1(a), in each instance after
such investigation as such officer or employee deemed to be reasonably
necessary and appropriate.
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"LIEN" means any mortgage, lien, debt, pledge, security interest,
encumbrance, assessment, restriction, charge or other adverse claim or
interest of every nature. With respect to the Kaiser Interests, "Lien" shall
also include any agreement limiting or restricting Xxxxxx'x right to vote,
transfer or otherwise dispose of the Kaiser Interests.
"LIMITED LIABILITY COMPANY AGREEMENT" has the meaning given in the
recitals.
"LIMITED PARTNERSHIP AGREEMENT" has the meaning given in the recitals.
"MEMBERS COMMITTEE" has the meaning given in the Limited Liability
Company Agreement.
"NONREFUNDABLE PAYMENT" has the meaning given in Section 3.2.
"PARTNERSHIP AGREEMENTS" means the Limited Liability Company Agreement
and the Limited Partnership Agreement.
"PERMITTED REAL PROPERTY LIENS" has the meaning given in Section 4.10.
"PERSON" means any individual, corporation, partnership, limited
liability company, joint venture, firm, association, public body,
governmental authority, trust or other entity.
"PHASE I IMPROVEMENTS" has the meaning given in the Contribution
Agreement.
"PROPOSED ACQUISITION TRANSACTION" has the meaning given in Section 8.14.
"PROPRIETARY RIGHTS" means any and all United States and foreign: (i)
patents (including design patents, industrial designs and utility models) and
patent applications (including docketed patent disclosures awaiting filing,
reissues, divisions, continuations-in-part and extensions), patent disclosure
awaiting filing determination, inventions and improvements thereto made or
developed prior to the Closing; (ii) trademarks, service marks, trade names,
trade dress, logos, business and product names, slogans, and registrations
and applications for registration thereof; (iii) copyrights (including
software) and registrations thereof; (iv) mask work rights and registrations
thereof; (v) inventions, processes, designs, formulae, trade secrets,
know-how and industrial models, confidential and technical information,
manufacturing, engineering and technical drawings, product specifications and
confidential business information; (vi) intellectual property rights similar
to any of the foregoing; (vii) copies and tangible embodiments thereof (in
whatever form or medium, including electronic media); and (viii) licenses
granting any rights with respect to any of the foregoing.
"PURCHASE PRICE" has the meaning given in Section 3.3.
"RECALL CAMPAIGN" means the recalling and replacing of wheels
identified in connection with the notice submitted to the National Highway
Safety Administration on or about April 17, 1998.
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"REFUND CLAIMS" has the meaning given in Section 3.9.
"RESTATED LEASE" means the Amended and Restated Lease Agreement
between Kaiser and the Company, to be dated as of the Closing Date,
substantially in the form of Exhibit A hereto.
"STRATEGIC PLAN" means the draft of the Strategic Plan (as defined in
the Limited Liability Company Agreement) presented by the Company to the
Members Committee at its December 1998 meeting.
"SUBSTANTIAL DETRIMENT" has the meaning given in Section 6.1(a).
"SURPLUS ASSETS" has the meaning given in Xxxx of Sale attached hereto
as Exhibit C.
"TAXES" means any tax, duty, fee, levy, impost, assessment or charge
of any nature, together with all interest or penalties thereon and additions
thereto, imposed by any Governmental Authority, whether computed on a
separate, consolidated, unitary, combined or any other basis, or any
liability for the payment of any of the foregoing (including without
limitation as a result of any express or implied obligation to indemnify any
other Person).
"TRANSACTIONS" means the transactions contemplated by this Agreement
and the Restated Lease.
"TREASURY REGULATIONS" means the federal income tax regulations,
including any temporary or proposed regulations, promulgated under the Code,
as such may be amended from time to time.
ARTICLE II
SALE AND PURCHASE
2.1 SALE AND PURCHASE. Upon the terms and subject to the
conditions of this Agreement, and in reliance upon the representations,
warranties and covenants contained herein, at the Closing Accuride will
purchase, and Kaiser shall transfer, sell and deliver to Accuride, all right,
title and interest of Kaiser in and to the Kaiser Interests and Kaiser shall
transfer, sell and deliver to the Company, all right, title and interest of
Kaiser in and to the Surplus Assets, in each instance, free and clear of all
Liens, other than Liens relating to, or otherwise granted by or on behalf of,
Accuride or Accuride Sub.
ARTICLE III
THE CLOSING
3.1 PLACE AND DATE. Subject to Section 9.1(ii), the closing of the
sale and purchase of the Kaiser Interests and Surplus Assets (the "CLOSING")
shall take place on a date within three (3)
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Business Days after Accuride obtains the financing necessary to satisfy the
condition to Closing set forth in Section 6.2(a) of this Agreement, unless
another date or time shall have been agreed to in writing by Accuride,
Accuride Sub and Kaiser (the "CLOSING DATE"). For all purposes relating to
their rights and obligations under this Agreement (other than the rights and
obligations with respect to the Nonrefundable Payment), the parties shall
treat the Closing and all Transactions contemplated herein as having occurred
simultaneously and become effective as of midnight at the beginning of the
actual date the Closing takes place.
3.2 NONREFUNDABLE PAYMENT. Upon the execution of this Agreement,
Accuride shall pay or cause to be paid to Kaiser an irrevocable,
nonrefundable payment in the amount of Thirty-Five Million Dollars
($35,000,000), payable in cash by wire transfer of immediately available
funds to the account or accounts specified in writing by Kaiser (the
"NONREFUNDABLE PAYMENT").
3.3 PURCHASE PRICE; PAYMENT. Upon the terms and subject to the
conditions of this Agreement, at the Closing, Accuride shall pay or cause to
be paid to Kaiser for the Kaiser Interests and the Surplus Assets a purchase
price of Seventy One Million Dollars ($71,000,000) as the same shall be
adjusted as provided for in Section 3.4 of this Agreement (the "PURCHASE
PRICE"). At the Closing, the Nonrefundable Payment shall be credited against
the Purchase Price and the balance of the Purchase Price shall be payable in
cash by wire transfer of immediately available funds to the account or
accounts specified in writing by Kaiser.
3.4 PURCHASE PRICE ADJUSTMENTS. The Purchase Price shall be
adjusted in an amount equal to the sum of (i) the aggregate cash infusions
made by Kaiser into the Company during the period from and including January
1, 1999, through March 31, 1999 (the "INTERIM PERIOD"), less the aggregate
cash distributions from the Company to Kaiser during the Interim Period (the
"CASH ADJUSTMENT"), plus (ii) an amount equal to the product of multiplying
(a) the sum of Seventy One Million Dollars ($71,000,000) and the Cash
Adjustment, less the Nonrefundable Payment, by (b) the product of the Daily
Rate multiplied the number of days from and including April 1, 1999, to, but
not including, the Closing Date, if the Closing Date is not April 1, 1999.
3.5 CASH ADJUSTMENT. As soon as reasonably practicable, but no
later than three (3) Business Days following the execution of this Agreement,
Kaiser shall provide Accuride with a statement calculating the Cash
Adjustment along with supporting detail and backup (the "CASH ADJUSTMENT
STATEMENT"). The amount set forth in the Cash Adjustment Statement shall be
binding on Accuride and Kaiser for all purposes unless Accuride gives written
notice of disagreement with the information reflected on the Cash Adjustment
Statement to Kaiser within three (3) Business Days after the receipt by
Accuride of the Cash Adjustment Statement or the last revision thereof by
Kaiser, specifying in reasonable detail, insofar as possible, the nature and
extent of such disagreement. If Accuride and Kaiser are unable to resolve
any such disagreement within three (3) Business Days after Accuride gives
Kaiser written notice thereof, the disagreement shall be referred for final
determination to any independent accounting firm of national reputation
mutually acceptable to Accuride and Kaiser. The determination of such
accounting firm shall be conclusive, nonappealable and binding upon Accuride
and Kaiser for all purposes. Accuride and Kaiser shall each pay the fees and
disbursements of their respective internal and independent accountants and
other personnel incurred in the initial preparation,
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review and final determination of the Cash Adjustment Statement. The fees and
expenses of such firm mutually selected by Accuride and Kaiser in connection
with the final determination of any disagreement submitted pursuant to the
terms hereof shall be shared equally by Accuride and Kaiser.
3.6 TRANSFER OF KAISER INTERESTS AND THE SURPLUS ASSETS. Upon the
terms and subject to the conditions of this Agreement, at the Closing, Kaiser
shall deliver to Accuride and the Company such instruments as may be
necessary or desirable to effect transfer, in form and substance reasonably
acceptable to Accuride, and take all such other actions as may be necessary
or desirable to convey and effectively vest (i) in Accuride good title in and
to the Kaiser Interests, free and clear of any Liens other than Liens
relating to, or otherwise granted by or on behalf of, Accuride or Accuride
Sub and to permit Accuride to become the substitute limited partner of the
Company and the substitute member of the General Partner pursuant to the
terms of the Limited Partnership Agreement and the Limited Liability Company
Agreement, respectively, and (ii) in the Company good title in and to the
Surplus Assets, free and clear of any Liens other than Liens relating to, or
otherwise granted by or on behalf of, Accuride or Accuride Sub. No portion
of the Kaiser Interests or Surplus Assets shall be transferred or conveyed,
or otherwise deemed to have been transferred or conveyed, by Kaiser hereunder
prior to the Closing Date.
3.7 [intentionally left blank]
3.8 CLOSING OF BOOKS. Whether or not a technical termination of
the Company results under Section 708 of the Code as a result of the
consummation of the Transactions, the Company shall have an actual closing of
the books as of the Closing Date. For the short period ending on the Closing
Date, all income, gains, profits and losses, and deductions of the Company
shall be allocated to its partners in accordance with the Limited Partnership
Agreement. Similarly, whether or not a technical termination of the General
Partner results under Section 708 of the Code as a result of the consummation
of the Transactions, the General Partner shall have an actual closing of the
books as of the Closing Date. For the short period ending on the Closing
Date, all income, gains, profits and losses, and deductions of the General
Partner shall be allocated to its members in accordance with the Limited
Liability Company Agreement.
3.9 RIGHTS WITH RESPECT TO NONREFUNDABLE PAYMENT. In the event
that the Transactions do not close for any reason other than a default by
Kaiser of its obligations under Section 6.2 of this Agreement, Kaiser shall
retain the Nonrefundable Payment as liquidated damages (and not as a penalty)
as consideration for other provisions contained in this Agreement, including,
but not limited to, Kaiser providing greater management control to Accuride
as provided in Section 8.8 hereof and Xxxxxx'x agreement to the further
postponing of the Buy/Sell Option as provided in Section 8.22 hereof. In
such event, Accuride and Accuride Sub hereby (i) voluntarily and knowingly,
fully, finally, completely and forever waive and relinquish any and all
interests in the Nonrefundable Payment and any claims, actions, demands and
causes of action of whatever kind or character, whether in statutory or
common law, whether in law or in equity, and whether under any existing or
future theory of recovery, which either of them have, might have or might
claim with respect to the refund or return of the Nonrefundable Payment,
including rights of offset (collectively, "REFUND CLAIMS"), (ii) remise,
acquit, release and forever discharge Kaiser from
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any and all Refund Claims, and (iii) agree not to assert or otherwise
directly or indirectly pursue any Refund Claims now or at any time in the
future. Notwithstanding Xxxxxx'x receipt of the Nonrefundable Payment, no
portion of the Kaiser Interests or Surplus Assets shall be transferred or
conveyed, or otherwise deemed to have been transferred or conveyed, by Kaiser
hereunder prior to the Closing Date. Similarly, nothing contained in this
Section 3.9 shall be deemed to preclude Accuride or Accuride Sub from
asserting claims against Kaiser (other than Refund Claims) arising from
Xxxxxx'x breach of any of the terms or conditions contained herein or in
connection with the Transactions contemplated by this Agreement.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF KAISER
Kaiser represents and warrants to Accuride Sub and Accuride:
4.1 CORPORATE EXISTENCE, POWER AND AUTHORIZATION. Kaiser is a
corporation duly incorporated, validly existing and in good standing under
the laws of the State of Delaware and has all requisite corporate power and
authority to execute and deliver this Agreement and the Restated Lease, to
perform its obligations hereunder and thereunder and to consummate the
Transactions. The execution, delivery and performance of this Agreement and
the Restated Lease and the consummation of the Transactions have been duly
authorized by the Board of Directors of Kaiser and no further corporate
actions or proceedings on Xxxxxx'x part are necessary to authorize the
execution and delivery of this Agreement and the Restated Lease, the
performance of the obligations hereunder or thereunder or the consummation of
the Transactions. This Agreement has been duly executed and delivered by
Kaiser and constitutes the valid and binding obligation of Kaiser (assuming
due execution and delivery by the other parties hereto), enforceable against
Kaiser in accordance with its terms, except insofar as enforceability may be
limited by bankruptcy, insolvency, moratorium or other laws which affect
creditors' rights and remedies generally and by principles of equity. Upon
the Closing, the Restated Lease and all instruments of conveyance and other
documents to be executed and delivered by Kaiser shall be duly executed and
delivered by Kaiser and shall constitute valid and binding obligations of
Kaiser (assuming due execution and delivery by the other parties thereto),
enforceable against Kaiser in accordance with their respective terms, except
insofar as enforceability may be limited by bankruptcy, insolvency,
moratorium or other laws which affect creditors' rights and remedies
generally and by principles of equity.
4.2 NO CONFLICTS; CONSENTS AND APPROVALS.
(a) The execution, delivery and performance of this Agreement and
the Restated Lease and the consummation of the Transactions do not result in
(i) any conflict with the certificate of incorporation or bylaws of Kaiser,
or (ii) any breach or violation of, or default under, any Applicable Law or
any mortgage, agreement, deed of trust, indenture, lease, contract or any
other instrument to which Kaiser is a party or by which Kaiser or its
properties or assets (including without limitation the Kaiser Interests) are
bound, except any breach, violation or default which could not reasonably be
expected to have a material adverse effect on the ability of
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Kaiser to perform its obligations under this Agreement or the Restated Lease.
(b) No consent, approval or authorization of, or filing with, any
Governmental Authority or any other third party is required on the part of
Kaiser in connection with the execution and delivery by Kaiser of this
Agreement or the Restated Lease or the consummation by Kaiser of the
Transactions, other than any consents, approvals, authorizations or filings,
the failure of which to obtain would not, individually or in the aggregate,
have a material adverse effect on the ability of Kaiser to perform its
obligations under this Agreement or the Restated Lease.
4.3 GOVERNMENTAL AUTHORIZATIONS; COMPLIANCE WITH LAW. All
approvals, permits, certificates, qualifications, authorizations, licenses,
franchises, consents, orders and registrations of all Government Authorities
(collectively, "GOVERNMENTAL AUTHORIZATIONS") which are necessary for the
lawful consummation by Kaiser of the Transactions have been obtained and are
in full force and effect, or will be obtained and will be in full force and
effect by the Closing Date. There are no proceedings pending or, to the best
of Xxxxxx'x Knowledge, threatened which could reasonably be expected to
result in the revocation, cancellation, suspension or modification of any
Governmental Authorization.
4.4 LITIGATION. There are no pending or, to the best of Xxxxxx'x
Knowledge, threatened judicial or administrative actions, proceedings or
investigations which (i) would reasonably be expected, individually or in the
aggregate, to have a material adverse effect on the ability of Kaiser to
consummate the Transactions or (ii) question the validity of this Agreement,
the Restated Lease or any action taken or to be taken by Kaiser in connection
herewith or therewith.
4.5 BROKERS. All negotiations relating to this Agreement, the
Restated Lease and the Transactions have been carried out without the
intervention of any Person acting on behalf of Kaiser in such manner as to
give rise to any valid claim against Accuride or Accuride Sub for any
brokerage or finder's commission, fee or similar compensation.
4.6 DISCLOSURE. No representation, warranty or statement by Kaiser
in this Agreement or the Restated Lease contains or will contain any untrue
statement of a material fact, or omits or will omit to state a material fact
necessary to make the statements contained herein and therein not misleading.
4.7 TITLE. On the Closing Date, Kaiser will be the legal and
beneficial owner of, and will have the complete and unrestricted power and
the unqualified right to transfer, and will transfer, the Kaiser Interests
and Surplus Assets, free and clear of all Liens, other than Liens relating
to, or otherwise granted by or on behalf of, Accuride or Accuride Sub. Upon
the delivery of and payment for the Kaiser Interests and Surplus Assets as
provided in this Agreement, Accuride will acquire good and valid title to the
Kaiser Interests and the Company will acquire good and valid title to the
Surplus Assets, in each instance free and clear of all Liens, other than
Liens relating to, or otherwise granted by or on behalf of, Accuride or
Accuride Sub.
4.8 INSURANCE. To the best of Xxxxxx'x Knowledge, (i) the policies
or binders of
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insurance as identified on Schedule 4.8 of which the Company is the owner,
insured or beneficiary (the "INSURANCE POLICIES") are in full force and
effect on the date hereof and, (ii) except as otherwise set forth on Schedule
4.8, shall be kept in full force and effect through April 30, 1999.
4.9 TAX MATTERS. Kaiser has acted as the tax matters partner under
the Partnership Agreements in accordance with the terms thereof. To the
best of Xxxxxx'x Knowledge, (i) the Company and the General Partner have not
received a ruling from any taxing authority or signed an agreement with any
taxing authority that could reasonably be expected to have a Company Material
Adverse Effect, and (ii) there is no expectation that any taxing authority
may claim or assess any new or additional Taxes payable by the Company or the
General Partner for any period ending on or prior to the Closing Date that
could reasonably be expected to have a Company Material Adverse Effect.
4.10 ADDITIONAL PREMISES. To the best of Xxxxxx'x Knowledge, there
is no violation of any restriction, condition, covenant or agreement
applicable to or affecting the Additional Premises, any part thereof or use
thereof, contained in any deed, subdivision map or other instrument, except
which, individually or in the aggregate, would not reasonably be expected to
have a Company Material Adverse Effect. Kaiser has good, valid and
marketable fee simple title to the Additional Premises, free and clear of all
Liens, except for (i) Liens and leases set forth on Schedule 3.4(b) to the
Contribution Agreement, (ii) liens for Taxes not yet due and payable or which
are being contested in good faith by appropriate proceedings and (iii)
imperfections of title which are not substantial in character, amount or
extent (in relation to the particular parcel) and that individually or in the
aggregate do not and would not interfere with the use of the Additional
Premises by the Company for the conduct of its business as currently
conducted (the Liens referred to in clause (i) and (ii) above being referred
to collectively as "PERMITTED REAL PROPERTY LIENS"). To the best of Xxxxxx'x
Knowledge, Kaiser and/or the Company have all easements, rights of way and
similar authorizations required for the ownership and use of the Additional
Premises by the Company for the conduct of its business as currently
conducted. Upon execution and delivery of the Restated Lease, the Company
shall have the exclusive right to use and occupy the Additional Premises,
except as otherwise set forth in the Restated Lease.
4.11 CERTAIN PAYMENTS. Neither Kaiser nor any of its directors,
officers or agents has, directly or indirectly, (a) made any contribution,
gift, bribe, rebate, payoff, influence payment, kickback or other payment to
any Person, private or public, regardless of form, whether in money, property
or services, for or in respect of the Company or any Affiliate of the Company
in connection with the business conducted by the Company, (i) to obtain
favorable treatment in securing business, (ii) to pay for favorable treatment
for business secured, (iii) to obtain special concessions or for special
concessions already obtained or (iv) in violation of any Applicable Law, or
(b) established or maintained any fund or asset for or in respect of the
Company or any Affiliate of the Company in connection with the business
conducted by the Company that has not been recorded in the books and records
of the Company.
4.12 CLAIMS. Following the Closing, to the best of Xxxxxx'x
Knowledge, Kaiser will not have any outstanding claims against Accuride,
Accuride Sub or any of their respective Affiliates,
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including the Company and the General Partner, arising from or in connection
with the breach or alleged breach of any agreement between or among Kaiser
and Accuride, Accuride Sub or any of their respective Affiliates, including
claims arising under or in connection with the Partnership Agreements.
4.13 PHASE I IMPROVEMENTS. To the best of Xxxxxx'x Knowledge,
Kaiser has satisfied its obligations in all material respects under Section
6.4 ("Covenants of Kaiser - Phase I Improvements") of the Contribution
Agreement. In addition, to the best of its knowledge, upon the Closing of the
Transactions, Kaiser will have satisfied any known obligations to the Company
and the General Partner under the Contribution Agreement and the Erie Lease
Agreement and with respect to the Landlord's Work (as defined in the Erie
Lease Agreement).
4.14 AGREEMENTS. Schedule 4.14 sets forth all existing material
agreements, contracts, leases, purchase orders, undertakings, understandings,
covenants not to compete, confidentiality agreements, licenses, obligations
or other commitments, whether oral or written, currently in effect between
Kaiser and any of its subsidiaries, on one hand, and Accuride, Accuride Sub,
the Company or the General Partner, on the other hand.
4.15 XXXXXX'X PROPRIETARY RIGHTS. To the best of Xxxxxx'x
Knowledge, except as contributed to the Company as part of the Kaiser Assets
(as defined in the Contribution Agreement) and except in connection with the
use of Kaiser trademarks, including trademarks, service marks, trade names,
trade dress, logos, business and product names and slogans using or
incorporating the name "Kaiser", "Xxxxxx Aluminum", "Xxxxxx Aluminum &
Chemical Corporation", or "KAE"or derivations thereof (collectively, "KAISER
MARKS"), the Company does not use any Proprietary Rights of Kaiser in the
conduct of the Company's business as presently conducted or presently
contemplated as reflected in the Strategic Plan. The Company has no
obligation to compensate Kaiser or, to the best of Xxxxxx'x Knowledge, any
other Person, for the use of any Proprietary Rights of Kaiser in the conduct
of the Company's business as presently conducted or presently contemplated as
reflected in the Strategic Plan.
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF ACCURIDE SUB AND ACCURIDE
Accuride Sub and Accuride each represent and warrant to Kaiser as
follows:
5.1 CORPORATE EXISTENCE, POWER AND AUTHORIZATION. It is a
corporation duly incorporated, validly existing and in good standing under
the laws of the State of Delaware, and has all requisite corporate power and
authority to execute and deliver this Agreement, to perform its obligations
hereunder and to consummate the Transactions. The execution, delivery and
performance of this Agreement and the consummation of the Transactions have
been duly authorized by its Board of Directors and no further corporate
actions or proceedings on its part are necessary to authorize the execution
and delivery of this Agreement, the performance of the obligations hereunder
or the consummation of the Transactions. It has duly executed and delivered
this Agreement and this Agreement constitutes its valid and binding
obligation
12
(assuming due execution and delivery by the other parties hereto) enforceable
against it in accordance with its terms, except insofar as enforceability may
be limited by bankruptcy, insolvency, moratorium or other laws which affect
creditors' rights and remedies generally and by principles of equity. Upon
the Closing, the other documents to be executed and delivered by it shall be
duly executed and delivered by it and shall constitute its valid and binding
obligations (assuming due execution and delivery by the other parties
thereto), enforceable against it in accordance with their respective terms,
except insofar as enforceability may be limited by bankruptcy, insolvency,
moratorium or other laws which affect creditors' rights and remedies
generally and by principles of equity.
5.2 NO CONFLICTS; CONSENTS AND APPROVALS.
(a) The execution, delivery and performance of this Agreement and
the consummation of the Transactions do not result in (i) any conflict with
its certificate of incorporation or bylaws, and (ii) any breach or violation
of, or default under, any Applicable Law or any mortgage, agreement, deed of
trust, indenture, lease, contract or other instrument to which it is a party
or by which it or any of its properties or assets are bound, except any
breach, violation or default which could not reasonably be expected to have a
material adverse effect on its ability to perform its obligations under this
Agreement.
(b) No consent, approval or authorization of, or filing with, any
Governmental Authority or any other third party is required on its part in
connection with the execution and delivery of this Agreement or the
consummation of the Transactions, other than any consents, approvals,
authorizations or filings, the failure of which to obtain would not,
individually or in the aggregate, have a material adverse effect on its
ability to perform its obligations under this Agreement.
5.3 GOVERNMENTAL AUTHORIZATIONS; COMPLIANCE WITH LAW. All
Governmental Authorizations which are necessary for the lawful consummation
by Accuride and Accuride Sub of the Transactions have been obtained and are
in full force and effect, or will be obtained and will be in full force and
effect by the Closing Date. There are no proceedings pending, or to the best
of its Knowledge, threatened which could reasonably be expected to result in
the revocation, cancellation, suspension or modification of any Governmental
Authorization.
5.4 LITIGATION. There are no pending or, to the best of its
Knowledge, threatened judicial or administrative actions, proceedings or
investigations which (i) would reasonably be expected, individually or in the
aggregate, to have a material adverse effect on its ability to consummate the
Transactions or (ii) question the validity of this Agreement or any action
taken or to be taken by it in connection herewith or therewith.
5.5 BROKERS. All negotiations relating to this Agreement, the
Restated Lease and the Transactions have been carried out without the
intervention of any Person acting on its behalf in such manner as to give
rise to any valid claim against Kaiser for any brokerage or finder's
commission, fee or similar compensation.
5.6 DISCLOSURE. No representation, warranty or statement made by
it in this
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Agreement contains or will contain any untrue statement of a material fact,
or omits or will omit to state a material fact necessary to make the
statements contained herein or therein not misleading.
5.7 INSURANCE. To the best of its Knowledge, (i) the Insurance
Policies are in full force and effect on the date hereof and (ii) except as
otherwise set forth on Schedule 4.8, shall be kept in full force and effect
through April 30, 1999.
5.8 TAX MATTERS. To the best of its Knowledge, (i) the Company and
the General Partner have not received a ruling from any taxing authority or
signed an agreement with any taxing authority that could reasonably be
expected to have a Company Material Adverse Effect, and (ii) there is no
expectation that any taxing authority may claim or assess any new or
additional Taxes payable by the Company or the General Partner for any period
ending on or prior to the Closing Date that could reasonably be expected to
have a Company Material Adverse Effect.
5.9 CERTAIN PAYMENTS. Neither it nor any of its directors,
officers or agents has, directly or indirectly, (a) made any contribution,
gift, bribe, rebate, payoff, influence payment, kickback or other payment to
any Person, private or public, regardless of form, whether in money, property
or services, for or in respect of the Company or any Affiliate of the Company
in connection with the business conducted by the Company, (i) to obtain
favorable treatment in securing business, (ii) to pay for favorable treatment
for business secured, (iii) to obtain special concessions or for special
concessions already obtained or (iv) in violation of any Applicable Law, or
(b) established or maintained any fund or asset for or in respect of the
Company or any Affiliate of the Company in connection with the business
conducted by the Company that has not been recorded in the books and records
of the Company.
5.10 CLAIMS. Following the Closing, to the best of its Knowledge,
it will not have any outstanding claims against Kaiser or any of Xxxxxx'x
Affiliates, including the Company and the General Partner, arising from or in
connection with the breach or alleged breach of any agreement with Kaiser or
any of Xxxxxx'x Affiliates, including claims arising under or in connection
with the Partnership Agreements.
5.11 AGREEMENTS. Schedule 4.14 sets forth all existing material
agreements, contracts, leases, purchase orders, undertakings, understandings,
covenants not to compete, confidentiality agreements, licenses, obligations
or other commitments, whether oral or written, currently in effect between
Kaiser and any of its subsidiaries, on one hand, and Accuride, Accuride Sub,
the Company or the General Partner, on the other hand.
ARTICLE VI
CONDITIONS
6.1 [intentionally left blank]
6.2 CONDITIONS TO OBLIGATIONS OF ACCURIDE AND ACCURIDE SUB. The
obligations of
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Accuride and Accuride Sub to consummate the Transactions shall be subject to
the fulfillment (or waiver by Accuride and Accuride Sub) on or prior to the
Closing Date of each of the following conditions:
(a) FINANCING. Accuride shall have obtained the financing
necessary to consummate the Transactions upon terms reasonably satisfactory
to Accuride in its sole discretion.
(b) EXECUTION AND DELIVERY OF RESTATED LEASE. The Restated Lease
shall have been duly executed and delivered by the Company and Kaiser.
(c) FIRPTA. Kaiser shall have furnished a certificate, dated as of
the Closing Date and sworn to under penalty of perjury, that sets forth the
name, address and federal taxpayer identification number of Kaiser, states
that it is not a "foreign person" within the meaning of Section 1445 of the
Code, and is otherwise in the form set forth in the Treasury Regulations
thereunder.
(d) RESIGNATIONS. All employees and agents of Kaiser who are
officers of the General Partner and/or the Company shall deliver resignations
from such offices effective as of the Closing Date.
(e) OPINION OF COUNSEL. Accuride and Accuride Sub shall have
received from the general counsel of Kaiser, an opinion in the form of
Exhibit B hereto.
(f) BILLS OF SALE. Kaiser shall have delivered bills of sale in
the forms of Exhibits C and D hereto.
(g) TRANSFER DOCUMENTS. Kaiser shall have delivered an (i)
assignment and assumption of limited partnership interest and limited
liability company interest in the form of Exhibit E hereto and (ii) an
acknowledgment of limited partnership interest and limited liability company
interest in the form of Exhibit F hereto.
6.3 CONDITIONS TO OBLIGATIONS OF KAISER. The obligations of Kaiser
to consummate the Transactions shall be subject to the fulfillment (or waiver
by Kaiser) on or prior to the Closing Date of each of the following
conditions:
(a) PAYMENT OF THE PURCHASE PRICE. Kaiser shall have received the
remaining balance of the Purchase Price as adjusted in accordance with this
Agreement.
(b) EXECUTION AND DELIVERY OF RESTATED LEASE. The Restated Lease
shall have been duly executed and delivered by the Company.
(c) COMPANY AND GENERAL PARTNER DOCUMENTS AND INSTRUMENTS. Kaiser
shall have received on the date hereof from each of the Company and the
General Partner an acknowledgment and certificate in the form of Exhibit G
attached hereto.
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ARTICLE VII
INDEMNIFICATION
7.1 INDEMNIFICATION. (a) Kaiser shall indemnify and hold harmless
each of Accuride, Accuride Sub and their respective control persons (as such
term is defined in the Securities Act of 1933, as amended, and the rules and
regulations thereunder), directors, officers, employees and agents, and the
successors and assigns of each of the foregoing, from and against any and all
losses, liabilities, damages, claims, costs and expenses whatsoever
(including without limitation reasonable legal and consultant fees and
expenses and any court costs), as incurred, whether or not resulting from
third party claims (each, a "CLAIM," and collectively, "CLAIMS"), arising out
of, resulting from or attributable to (i) any breach by Kaiser of any of its
covenants or obligations contained in this Agreement or the Restated Lease;
(ii) any breach by Kaiser of, or any inaccuracy in, any representation or
warranty made by Kaiser in this Agreement or the Restated Lease; and (iii)
any breach by Kaiser of its obligations under the Partnership Agreements.
(b) Accuride and Accuride Sub shall indemnify and hold harmless
Kaiser and its respective control persons (as such term is defined in the
Securities Act of 1933, as amended, and the rules and regulations
thereunder), directors, officers, employees and agents, and the successors
and assigns of each of the foregoing, from and against any and all Claims
arising out of, resulting from or attributable to (i) any breach by Accuride
or Accuride Sub of any of their respective covenants or obligations contained
in this Agreement; (ii) any breach by Accuride or Accuride Sub of, or any
inaccuracy in, any representation or warranty made by Accuride and Accuride
Sub in this Agreement; and (iii) any breach by Accuride Sub of its
obligations under the Partnership Agreements.
7.2 INDEMNIFICATION PROCEDURES. For purposes of this Section 7.2,
the party seeking indemnification shall be known as the "INDEMNIFIED PARTY"
and the party from whom indemnification is sought shall be known as the
"INDEMNIFYING PARTY." As soon as reasonably practicable after receipt by an
Indemnified Party of notice of any Claim in respect of which an Indemnifying
Party may be liable under Section 7.1, the Indemnified Party shall give
notice thereof to the Indemnifying Party, setting forth in reasonable detail
the facts and circumstances pertaining thereto, but the failure to give such
notice shall not relieve the Indemnifying Party of its obligations under this
Article VII unless and to the extent that the Indemnifying Party is
prejudiced by such failure. In the event that the Claim arises out of or
results from a claim by any third party, the Indemnified Party shall permit
the Indemnifying Party, at its option and expense, to assume the defense of,
and subject to the consent of the Indemnified Party, which shall not be
unreasonably withheld, in each case settle or otherwise dispose of such claim
by counsel reasonably satisfactory to the Indemnified Party, provided that
the Indemnified Party may participate in such defense by counsel of its own
choice, but the fees, expenses and other charges of such counsel will be
solely for the account of the Indemnified Party, unless: (a) the employment
of counsel by the Indemnified Party has been authorized in writing by the
Indemnifying Party, (b) there is a conflict or potential conflict (based on
advice of counsel to the Indemnified Party reasonably acceptable to the
Indemnifying Party) between the Indemnified Party and the Indemnifying Party,
or (c) the Indemnifying Party has not in fact employed counsel
16
to assume the defense of such action within a reasonable time after receiving
notice of the commencement of the action, and provided, further, that the
Indemnified Party shall be entitled to control such defense jointly with the
Indemnifying Party in the case of any litigation referred to in clause (b) of
the immediately preceding proviso to this sentence. Notwithstanding anything
to the contrary in this Section 7.2, without the prior written consent of
each Indemnified Party (or of each Indemnifyig Party if the Indemnified Party
is defending such third party claim), which consent shall not be unreasonably
withheld, the Indemnifying Party (or Indemnified Party, as the case may be)
shall not consent to the entry of any judgment or enter into any settlement
that does not include an unconditional release of each Indemnified Party (or
Indemnifying Party) from all liabilities in respect of such Claims. The
Indemnifying Party shall pay for any Claim promptly in cash once its
responsibility has been established.
7.3 THIRD PARTY BENEFICIARIES. Any Indemnified Party not party to
this Agreement shall be a third party beneficiary of this Agreement for
purposes of this Article VII.
ARTICLE VIII
OTHER MATTERS
8.1 TERMINATION OF CERTAIN AGREEMENTS. Unless sooner terminated
upon the mutual written agreement of the parties thereto and except as
otherwise set forth herein, each of the Kaiser Technical Services Agreement
and the Xxxxxx Production Services Agreement shall, and shall be deemed to,
terminate on August 31, 1999. Unless sooner terminated upon the mutual
written agreement of the parties thereto and except as otherwise set forth
herein, the Kaiser Administrative Services Agreement shall, and shall be
deemed to, terminate on August 31, 1999, with respect to all services
currently being provided by Kaiser thereunder other than tax services which
shall continue through the timely preparation and filing of the tax returns
specified in Section 8.10. Kaiser shall, pursuant to the terms of those
agreements, continue to be paid and reimbursed for any such services that it
continues to provide.
8.2 TERMINATION OF CERTAIN SERVICES. Effective as of April 2,
1999, or such other date mutually agreed to in writing by the parties hereto,
Accuride or Accuride Sub, shall assume control of all of the cash management,
treasury and hedging activities currently being performed by Kaiser for the
General Partner and the Company.
8.3 CONTINUATION OF RIGHTS AND OBLIGATIONS. Except as otherwise
specifically set forth in this Agreement or the Restated Lease, the rights
and obligations of Kaiser, Accuride Sub, Accuride, the General Partner and
the Company under each of the Formation Agreements, including, without
limitation, the covenants set forth in Article VI of the Contribution
Agreement and the indemnification provisions set forth in Article VII of the
Contribution Agreement, shall continue in full force and effect subject only
to the terms, conditions and limitations set forth herein and therein. The
parties hereto agree that the representations and warranties set forth in
Articles 4 and 5 of this Agreement shall not amend, limit or otherwise modify
in any manner any of the respective parties' rights and obligations under any
of the Formation Agreements. It being further understood by the parties that
the foregoing shall not preclude a claim under this
17
Agreement by any party hereto based upon the breach of any such
representation or warranty.
8.4 RECALL CAMPAIGN. Notwithstanding any other provision to the
contrary contained in the Contribution Agreement, any other Formation
Agreement or otherwise, the Company shall be solely responsible for the
Recall Campaign and all liabilities, costs and expenses of the Recall
Campaign (the "Recall Costs") and Kaiser shall not have any liability to the
Company, the General Partner, Accuride, Accuride Sub or any of their
Affiliates for the Recall Costs, whenever incurred. This Section 8.4 does
not create additional indemnification rights except as set forth in the
Formation Agreements and indemnification against the Company for the Recall
Costs. Notwithstanding the foregoing, the parties hereto agree that the cause
of the Recall Campaign has not been mutually agreed upon by the parties
hereto and that this Section 8.4 does not amend, limit or otherwise modify in
any manner any of the respective parties's rights and obligations under the
Formation Agreements for any other liabilities, costs or expenses arising
from the wheels which are the subject of the Recall Campaign, including third
party claims or any claims based on product defects.
8.5 COVENANT NOT TO COMPETE. Effective as of the Closing Date,
neither Kaiser, Accuride, Accuride Sub nor any of their respective Affiliates
shall have any obligations under Section 11.2 of each of the Partnership
Agreements. In lieu of the foregoing, effective as of the Closing Date,
Kaiser agrees that for a period of five (5) years after the Closing Date,
neither Kaiser nor any of its Affiliates (including future Affiliates) will,
compete with the business of the Company as currently being conducted or
otherwise, directly or indirectly, design, manufacture or sell, or
participate whether by ownership interest or otherwise in the design,
manufacture or sale of, any Joint Venture Products (except in connection with
or as a result of fundamental corporate transactions, including mergers,
spin-offs and sales of substantially all of the capital stock or assets of
Kaiser or its parent corporations, except that Kaiser shall not acquire any
businesses which have more than twenty-five percent (25%) of their revenues
derived from businesses which compete with the Company in the business as
currently conducted by the Company, and with respect to businesses which
derive less than 25% of their revenue from businesses which compete with the
Company in the business currently conducted by the Company, Kaiser will
dispose of any competing businesses acquired within twelve (12) months of
such acquisition). For purposes of this Section only, the term "Joint
Venture Products" shall include any wheels of the size and type described in
clause (i) of the definition of Joint Venture Products in Article I of this
Agreement manufactured from non-ferrous materials (other than thermoplastics
and thermosets). The foregoing restrictions shall not preclude or otherwise
prevent Kaiser or any of its Affiliates from (i) acting solely as a supplier
or xxxxxx of aluminum, aluminum alloys or other materials used in the
production of Joint Venture Products, or (ii) participating in or otherwise
conducting research or development of new alloys or materials.
8.6 AMENDMENT OF PUBLIC FILINGS AND REPLACEMENT OF DESIGNATED
AGENTS. Promptly following the Closing, Accuride and Accuride Sub shall cause
the Company and the General Partner to submit such filings and notifications
necessary to appoint Persons other than Kaiser as agents for service of
process or mailings for matters pertaining to the General Partner or the
Company and reflect the fact that Kaiser no longer owns any interest in the
General Partner and the Company.
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8.7 INSPECTION OF BOOKS AND RECORDS. (a) Following the Closing,
Kaiser and/or its representatives and agents, at Xxxxxx'x expense and at
reasonable times during business hours, shall have the right to inspect and
make copies and extracts of all books of account and all financial, legal and
business records (which books of account, financial, legal and business
records shall be retained for not less than seven years after the Closing
Date) of (i) the Company and the General Partner, as well as access to, and
the cooperation of, any employee of the Company or General Partner having
knowledge of the information therein contained and the right to discuss the
matters recorded in such books and records with the independent certified
accountants retained by the Company and/or General Partner, and (ii) Accuride
related to the services provided by Accuride under any of the Ancillary
Agreements (as defined in the Contribution Agreement), including, without
limitation, the Accuride Technical Services Agreement, the Accuride Sales and
Marketing Agreement and the Accuride Administrative Services Agreement, as
well as access to, and the cooperation of, any employee of Accuride having
knowledge of the information therein contained, in each instance if such
inspection, access and cooperation are for any reasonable purpose, including
without limitation (1) preparation for proceedings, claims, actions, suits,
investigations or disputes to which Kaiser is a party relating to the conduct
of the business prior to the Closing Date by Kaiser, Accuride, the Company
and/or the General Partner, (2) any proceedings, claims, actions, suits,
investigations or disputes between Kaiser and the Company, the General
Partner, Accuride and/or Accuride Sub relating to the conduct of the business
prior to the Closing Date by Kaiser, Accuride, the Company and/or the General
Partner, (3) performance of accounting or tax reviews or audits of the
business conducted by the Company or the General Partner relating to periods
prior to the Closing Date or (4) any purpose reasonably related to Xxxxxx'x
ownership of its Interest in the Company and/or the General Partner;
provided, that such inspection, access or cooperation shall not unreasonably
interfere with the normal operations of the Company and Kaiser and/or its
representatives shall not be entitled to any such inspection, access or
cooperation (i) as to which the attorney-client privilege applies or (ii) the
disclosure of which is restricted Applicable Law except in strict compliance
with such law.
(b) Following the Closing, Accuride or Accuride Sub and/or their
representatives and agents, at the expense of Accuride and Accuride Sub and
at reasonable times during business hours, shall have the right to inspect
and make copies and extracts of all the books of account and all financial,
legal and business records of Kaiser related to the services provided by
Kaiser under any of the Ancillary Agreements (as defined in the Contribution
Agreement), including, without limitation, the Kaiser Technical Services
Agreement, the Xxxxxx Production Services Agreement and the Kaiser
Administrative Services Agreement, as well as access to, and the cooperation
of, any employee of Kaiser having knowledge of the information therein
contained and the right to discuss the matters recorded in such books and
records with the independent certified accountants retained by Kaiser, if
such inspection, access and cooperation are for any reasonable purpose,
including without limitation (i) preparation for proceedings, claims,
actions, suits, investigations or disputes to which Accuride, Accuride Sub or
the Company is a party relating to the conduct of the business of the Company
prior to the Closing Date by Kaiser, Accuride, the Company or the General
Partner, (ii) any proceedings, claims, actions, suits, investigations or
disputes between Kaiser and the Company, the General Partner, Accuride and/or
Accuride Sub, or (iii)
19
performance of accounting or tax reviews or audits of the business conducted
by the Company or the General Partner relating to periods prior to the
Closing Date; provided, that such inspection, access or cooperation shall not
unreasonably interfere with the normal operations of Kaiser and Accuride,
Accuride Sub and their representatives shall not be entitled to any such
inspection, access or cooperation (i) as to which the attorney-client
privilege applies or (ii) the disclosure of which is restricted by Applicable
Law except in strict compliance with such law.
8.8 INTERIM MATTERS. From and after the date of this Agreement,
Accuride shall, subject to the terms and conditions otherwise set forth in
this Agreement, have management control of the business conducted by the
Company. Notwithstanding the foregoing, Accuride agrees that between the date
hereof and the Closing Date, that (i) Accuride will, and will cause the
Company and the General Partner to (a) conduct the business of the Company
and the General Partner in a manner consistent with the ordinary course of
the normal day-to-day operations of the Company and the General Partner and
consistent with past practice and (b) use its reasonable best efforts to
preserve intact the current business organization and corporate structure of
the Company and the General Partner, and maintain the relations and good will
with suppliers, customers, landlords, creditors, employees, agents and others
having business relationships with the Company and/or the General Partner,
and (ii) Accuride will not, and will not permit the Company and the General
Partner to, in each case without Xxxxxx'x prior written consent, take any of
the actions identified in Sections 6.4(vi), (vii), (xiii), (xiv), (xv), (xvi)
and (xviii) of the Limited Liability Company Agreement.
8.9 PROPERTY TAXES. Property taxes for 1999 shall be allocated to
the short period ending on the Closing Date based on the actual number of
calendar days in each period (it being understood that the foregoing shall
not alter, amend or otherwise modify the terms of the Restated Lease).
8.10 TAX RETURNS. Kaiser shall be responsible for the timely
preparation of all 1998 tax returns required to be filed for the General
Partner and the Company consistent with past practice in accordance with the
Partnership Agreements and the Kaiser Administrative Services Agreement.
Kaiser shall also be responsible for the timely preparation of 1999 tax
returns for the period through the Closing Date. With respect to the period
from January 1, 1999 through the Closing Date, no elections shall be made or
positions taken that are not consistent with past practice. Kaiser shall
remain the owner of the Kaiser Interests for income tax purposes through the
Closing Date.
8.11 NOTIFICATION OF CERTAIN MATTERS. From and after the date
hereof and up to the Closing, each party shall give prompt notice to the
other following its receipt of notice of any material failure of such party
to comply with or satisfy any covenant, condition or agreement to be complied
with or satisfied by it hereunder; PROVIDED, HOWEVER, that such disclosure
shall not be deemed to cure any breach of a covenant or agreement or to
satisfy any condition.
8.12 FURTHER ASSURANCES. Upon the terms and subject to the
conditions contained herein, the parties agree, in each case both before and
after the Closing, (i) to use all reasonable efforts to take, or cause to be
taken, all actions and to do, or cause to be done, all things
20
necessary, proper or advisable to consummate and make effective the
transactions contemplated by this Agreement and the Restated Lease, (ii) to
execute any documents, instruments or conveyances of any kind which may be
reasonably necessary or advisable to carry out any of the Transactions, and
(iii) to cooperate with each other in connection with the foregoing.
8.13 NO SOLICITATION. For a period of five years following the
Closing Date, Kaiser shall not, and Kaiser shall cause its Affiliates not to,
directly or indirectly, hire or retain, or offer to hire or retain any
employee of the Company, except for employees who (i) contact Kaiser or its
Affiliates on his or her own initiative without any direct or indirect
solicitation or encouragement from Kaiser or its Affiliates, (ii) respond to
any public advertisement placed by Kaiser or its Affiliates, or (iii) have
been terminated by the Company prior to commencement of employment
discussions with Kaiser or its Affiliates.
8.14 NO-SHOP. From the date hereof through the Closing or the
earlier termination of this Agreement, Kaiser shall not, and Kaiser shall
cause its Affiliates and their respective employees, agents or advisors
(including without limitation investment bankers, attorneys and accountants),
not to, directly or indirectly, solicit, initiate or continue any discussions
or negotiations with, or encourage or respond to any inquiries or proposals
by, or participate in any negotiations with, or provide any information to,
or otherwise cooperate in any other way with, any corporation, partnership,
person or other entity or group, other than Accuride and Accuride Sub
concerning any sale of all or a portion of the Kaiser Interests (a "PROPOSED
ACQUISITION TRANSACTION"). From the date hereof through the Closing or the
earlier termination of this Agreement, Kaiser shall not, directly or
indirectly, through any officer, director, employee, representative, agent or
otherwise, solicit, initiate or encourage the submission of any proposal or
offer from any person relating to any Proposed Acquisition Transaction or
participate in any negotiations regarding, or furnish to any other person any
information with respect to the Company or otherwise cooperate in any way
with, or assist or participate in, facilitate or encourage, any effort or
attempt by any other person to seek or effect a Proposed Acquisition
Transaction.
8.15 KAISER MANUFACTURING AGREEMENT. The parties hereto agree that
there is no Kaiser Manufacturing Agreement (as defined in the Contribution
Agreement) and the parties shall not have any obligations thereunder.
8.16 CONFIDENTIAL INFORMATION. Effective as of the Closing Date
Kaiser shall not have any obligations under Section 11.1 of each of the
Partnership Agreements. In lieu thereof, effective as of the Closing Date
Kaiser agrees that during the existence of the Company or five years from the
Closing Date, whichever is later, Kaiser (i) shall maintain, and shall use
its best efforts to cause its Affiliates, officers, directors, employees,
accountants, counsel and agents to maintain, the confidentiality of any
confidential information concerning the Joint Venture Products, the Company,
the General Partner, Accuride, Accuride Sub or the business of the Company
that is not otherwise generally available to the public and (ii) without the
prior consent of Accuride and the Company, shall not use or disclose to any
third party (other than their respective financial advisors, attorneys and
other agents and representatives) such confidential information, except (a)
after receipt of a binding order of confidentiality, if available, in
enforcing
21
its rights under one or both of the Partnership Agreements; any of the
Formation Agreements; any agreement between or among Kaiser, on the one hand,
and Accuride, Accuride Sub, the Company and/or the General Partner, on the
other; this Agreement; the Restated Lease; or the Transactions, or (b) to any
governmental agency if it believes in good faith that such disclosure is
required by applicable law or by governmental policy, provided that prior to
making any such disclosure Kaiser shall, unless prohibited by such
governmental agency, give written notice (identifying such agency and
describing the general nature of such disclosure) to, and consult with, the
Company and Accuride.
8.17 INSURANCE. After the date hereof, Kaiser shall provide
reasonable assistance in making and collecting claims on the Insurance
Policies.
8.18 USE OF NAMES. Neither the Company, the General Partner,
Accuride nor Accuride Sub will, directly or indirectly, use in any manner
whatsoever, or allow any of their respective Affiliates to use in any manner
whatsoever, the Kaiser Marks after the Closing Date. Notwithstanding the
foregoing, the Company and the General Partner may continue to use the Kaiser
Marks during the six month period beginning on the Closing Date in connection
with the use of existing inventories or materials and supplies containing any
such Kaiser Marks.
8.19 ULTRA-FORGE EQUIPMENT. Prior to the end of the six (6) month
period beginning on the Closing Date, Kaiser shall have removed or caused the
removal of its hub machining line and related Kaiser equipment and inventory
currently located at the Ultra-Forge facility in Cuyahoga Falls, Ohio.
Absent a written agreement to the contrary between Kaiser and Accuride, any
equipment remaining at the end of such six (6) month period shall become the
property of AKW on an "as is, where is" basis and with all faults.
8.20 DISTRIBUTIONS. The General Partner and the Company shall have
been deemed to have authorized pursuant to Sections 5.1 of Limited
Partnership Agreement and the Limited Liability Company Agreement,
respectively, distributions in an amount equal to net cash distributions
received by Accuride Sub and Kaiser from the General Partner and the Company
at any time prior through March 31, 1999, in connection with the sweeping of
the accounts maintained by the Company and/or General Partner and
distribution of such amounts to Accuride Sub and Kaiser in the ordinary
course of business of the Company and the General Partner.
8.21 ENGINEERING STORES. Within thirty (30) days of the Closing
Date, the Company shall return to Kaiser all surplus engineering stores in
its possession for which it has not reimbursed Kaiser.
8.22 EFFECTIVE DATE OF BUY/SELL OPTION. From and after the date
hereof, unless otherwise agreed by the parties in writing, the effective date
of the Buy/Sell Option set forth in Section 9.3 of each of the Partnership
Agreements shall be moved from May 1, 1999, to November 1, 1999.
8.23 FUNDING REQUIREMENTS. From and after the date hereof, Accuride
and Accuride Sub shall assume the financial obligations of the Company and
the General Partner, fund one
22
hundred percent (100%) of the cash infusions required by the Company and the
General Partner and receive one hundred percent (100%) of the cash
distributions from the Company and the General Partner made in the ordinary
course of business and consistent with past practice.
ARTICLE IX
MISCELLANEOUS
9.1 TERMINATION. This Agreement may be terminated at any time
prior to the Closing:
(i) By the written agreement of Accuride, Accuride Sub and
Kaiser;
(ii) By any party hereto upon notice to each other party if
the Closing has not occurred on or prior to July 30, 1999, or such later date
as may be approved by the parties hereto;
(iii) By Accuride if it determines, in its sole discretion
that it cannot obtain the financing contemplated by Section 6.2(a) of this
Agreement.
Upon any termination of this Agreement, the parties hereto shall have
no liability to each other by reason of such termination except for
liabilities accrued on or prior to the date of such termination; provided
that if such termination shall result from the breach by a party of the
covenants or agreements of such party, such party shall be fully liable for
any and all damages, costs and expenses (including reasonable counsel fees)
sustained or incurred by the other parties to this Agreement and provided,
further, that the provisions contained in Sections 3.2, 3.9 and 8.22,
Articles VII and IX (except for Sections 9.4 and 9.7) hereof shall survive
any termination of this Agreement.
9.2 GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK,
WITHOUT REGARD TO THE CONFLICT OF LAWS PRINCIPLES THEREOF. NOTWITHSTANDING
THE FOREGOING, ANY AND ALL MATTERS RELATING TO THE RIGHTS AND OBLIGATIONS
UNDER THE PARTNERSHIP AGREEMENTS SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE (OTHER THAN ANY CONFLICT OF
LAW RULE WHICH MIGHT RESULT IN THE APPLICATION OF THE LAWS OF ANY OTHER
JURISDICTION). IN THE EVENT OF A CONFLICT BETWEEN ANY PROVISION OF EITHER OF
THE PARTNERSHIP AGREEMENTS AND ANY NON-MANDATORY PROVISION OF THE DELAWARE
REVISED UNIFORM LIMITED PARTNERSHIP ACT OR THE DELAWARE LIMITED LIABILITY
COMPANY ACT, AS APPLICABLE, THE PROVISIONS OF THE APPLICABLE PARTNERSHIP
AGREEMENT SHALL CONTROL AND TAKE PRECEDENCE.
9.3 ARBITRATION. (a) Any dispute, controversy or claim arising out
of, relating to or in connection with, this Agreement or the breach, validity
or termination thereof shall be finally settled by arbitration. The
arbitration shall be conducted in accordance with the American
23
Arbitration Association's commercial arbitration rules in effect at the time
of arbitration, except as modified herein or by mutual agreement of the
parties. The seat of the arbitration shall be New York, New York; provided
that the arbitrators may hold hearings in such other locations as the
arbitrators determine to be most convenient and efficient for all the parties
under the circumstances. Notwithstanding anything to the contrary in Section
9.2, the arbitration shall be governed by the Federal Arbitration Act.
(b) The arbitration shall be conducted by three arbitrators. One
arbitrator shall be appointed by Accuride and/or Accuride Sub, as the case
may be, and one arbitrator shall be appointed by Kaiser. The two arbitrators
so selected shall appoint the third arbitrator. If any party to the dispute
fails to make a timely appointment, or if the initial two arbitrators cannot
agree on the third arbitrator within ten (10) days of their appointment, any
party hereto may request the American Arbitration Association to appoint such
arbitrator(s).
(c) Any award rendered by the arbitrators shall be in writing,
state the reasons for the award and be final and binding upon the parties.
The award may include an award of costs, including reasonable attorneys' fees
and disbursements. Judgment upon the award rendered may be entered in any
court having jurisdiction thereof or having jurisdiction over the relevant
parties or their assets.
9.4 SURVIVAL. The representations and warranties of the parties
hereto contained in this Agreement or in the Restated Lease, or otherwise
made in writing in connection with the Transactions, shall survive until May
1, 2001, except with respect to the representations and warranties set forth
in (i) Section 4.7 (Title), which shall survive indefinitely and (ii)
Sections 4.9 and 5.8 (Tax Matters), which shall survive until the expiration
of the applicable statute of limitations (with extensions). Any due
diligence or investigation conducted by or on behalf of any party hereto, or
information furnished by such party or representative thereof in connection
therewith shall not limit or in any way prejudice the right of such party to
rely on the representations and warranties set forth herein.
9.5 ENTIRE AGREEMENT; AMENDMENT; ASSIGNMENT, ETC. This Agreement,
together with the Restated Lease and the Formation Agreements, embodies the
entire agreement and understanding between the parties relating to the
subject matter hereof and thereof, and supersedes any prior oral or written
agreements, commitments or terms. Neither this Agreement nor any of the
terms hereof may be amended, modified or waived, supplemented or terminated
other than by a document in writing, signed by the party or parties against
which the enforcement of such amendment, modification, waiver, supplement or
termination is sought. This Agreement shall be binding upon the respective
successors and permitted assigns of the parties hereto. This Agreement shall
not be assignable or otherwise transferable by any party without the prior
written consent of the other parties and any attempt to so assign or transfer
this Agreement without such consent shall be void and of no effect.
9.6. BUY/SELL OPTION. Notwithstanding anything to the contrary in
this Agreement, this Agreement is not related to and is not intended to
trigger the Buy/Sell Option set forth in Section 9.3 of either of the
Partnership Agreements.
24
9.7. SPECIFIC PERFORMANCE. Each of the parties acknowledges and
agrees that the other parties would be irreparably damaged in the event the
provisions of Sections 8.5 and 8.13 are not performed in accordance with its
specific terms or otherwise are breached. Therefore, notwithstanding
anything to the contrary in this Agreement, each of the parties agrees that
the other parties shall be entitled to an injunction or injunctions to
prevent breaches of Sections 8.5 and 8.13 and to enforce specifically the
performance by such first party under Sections 8.5 and 8.13, and each party
agrees to waive the defense in any such suit that the other parties have an
adequate remedy at law and to interpose no opposition, legal or otherwise, as
to the propriety of injunction or specific performance as a remedy, and
agrees to waive any requirement to post any bond in connection with obtaining
such relief. The equitable remedies described in this Section 9.7 shall be
in addition to, and not in lieu of, any other remedies at law or in equity
that the parties hereto may elect to pursue.
9.8 NOTICES. Any notice or other communication required or
permitted to be given hereunder or for the purposes hereof to any party shall
be in writing and shall be sufficiently given if (i) delivered personally,
(ii) mailed by certified or registered mail, postage prepaid, (iii)
transmitted by facsimile (and confirmed by mail) or (iv) sent by next day or
overnight mail or delivery to:
(a) Accuride Sub and Accuride at:
Accuride Corporation
0000 Xxxxx Xxxx/X.X. Xxx 00
Xxxxxxxxx, Xxxxxxxx 00000
Attn: Xxxxxxx X. Xxxxxxx
Tel: (000)000-0000
Fax: (000)000-0000
with a copy to:
Accuride Corporation
0000 Xxxxx Xxxx/X.X. Xxx 00
Xxxxxxxxx, Xxxxxxxx 00000
Attn: Xxxxx X. Xxxxxxxxx
Tel: (000)000-0000
Fax: (000)000-0000
(b) Kaiser at:
Xxxxxx Aluminum & Chemical Corporation
00000 Xxxxxxxxxxxx Xxxxxxx Xxxxx
Xxxxx 000
Xxxxxxxxxx, XX 00000
Attn: Vice President, Controller
25
Tel: (000)000-0000
Fax: (000)000-0000
with a copy to:
Xxxxxx Aluminum & Chemical Corporation
0000 Xxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
Attn: General Counsel
Tel: (000)000-0000
Fax: (000)000-0000
or at such other address or to such other person's attention as the party to
whom such notice is to be given shall have last notified the party giving the
same in the manner provided in this Section. Any notice so delivered to the
party to whom it is addressed shall be deemed to have been given and received
(a) if by personal delivery, on the day of such delivery, (b) if by certified
or registered mail, on the seventh day after mailing thereof, (c) if by
facsimile, the day on which such facsimile was sent as evidenced by receipt
of a confirmation indicating a successful transmission or (d) if by next day
or overnight mail delivery, on the day delivered, provided that if, with
respect to any of the foregoing, any such day is not a Business Day then the
notice shall be deemed to have been given and received on the Business Day
next following such day.
9.9 EXPENSES. Each party hereto shall pay all its own costs, fees
and expenses incident to this Agreement and the Transactions contemplated
hereby, including legal and accounting fees and disbursements.
9.10 SEPARABILITY OF PROVISIONS. Each provision of this Agreement
shall be considered separable and if for any reason any provision or
provisions herein are determined to be invalid, unenforceable or illegal
under any existing or future law, such invalidity, unenforceability or
illegality shall not impair the operation of or affect those portions of this
Agreement which are valid, enforceable and legal. If any provision of this
Agreement is held to be unenforceable for any reason, it shall be adjusted
rather than voided, if possible, in order to achieve the intent of the
parties to the extent possible.
9.11 NO THIRD PARTY BENEFICIARIES. Nothing in this Agreement will
be construed as giving any Person, other than the parties hereto and their
successors and permitted assigns, any right, remedy or claim under or in
respect of this Agreement or any provision hereof, except as specifically
provided for herein.
9.12 SECTION HEADINGS; COUNTERPARTS; ETC. The section headings of
this Agreement are for convenience of reference only and are not to be
considered in construing this Agreement. This Agreement may be executed in
any number of counterparts, each of which shall be an original, but all of
which together shall constitute one and the same instrument.
26
IN WITNESS WHEREOF, Accuride Sub, Accuride and Kaiser have caused this
Agreement to be duly executed in their respective corporate names by their
respective officers, each of whom is duly and validly authorized and
empowered, all on and as of the date first above written.
ACCURIDE CORPORATION ACCURIDE VENTURES, INC.
By: By:
------------------------------- --------------------------------
Name: Xxxxxxx X. Xxxxxxx Name: Xxxxxxx X. Xxxxxxx
Title: President Title: President
XXXXXX ALUMINUM & CHEMICAL
CORPORATION
By:
--------------------------------
Name: Xxxx X. Xxxxxxx
Title: Vice President
27
Schedule 1(a)
Knowledge
Kaiser:
Xxxx X. Xxxxxxx Sections 4.3, 4.4, 4.8, 4.9, 4.10, 4.12, 4.13 and 4.15
Vice President and President
Kaiser Engineered Products
Xxxxx Xxxxx Sections 4.3, 4.4, 4.8, 4.9, 4.10, 4.12, 4.13 and 4.15
Vice President & Controller
Kaiser Engineered Products
Xxxx Xxxxxxxx Sections 4.3, 4.4, 4.8, 4.9, 4.10, 4.12, 4.13 and 4.15
Vice President Planning and Development
Kaiser Engineered Products
Xxxxxx X. Xxxxxx Section 4.9
Director of Tax Planning
Xxxxxxx X. Xxxxxxx Section 4.8
Director of Risk Management
Accuride:
Xxxxxxx X. Xxxxxxx Sections 5.3, 5.4, 5.7, 5.8 and 5.10
Xxxx Xxxxxx Sections 5.3, 5.4, 5.7, 5.8 and 5.10
Xxxxxx Xxxxxxxx Sections 5.7 and 5.8
28
Schedule 4.8
INSURANCE POLICIES
POLICY TYPE POLICY NUMBER INSURER
----------- ------------- -------
Crime 000-00-00 National Union Fire Ins. Co.
Fiduciary Liability 000-000000-00 Executive Risk Indemnity Ins.
General Liability (1) 61 CES SS 853 Twin City Fire Ins. Co.
Workers' Compensation 382509 Employee Benefits Ins. Co.
Employers Liability
Primary Excess Liability 61 HU SL5703 Twin City Fire Ins. Co.
Excess Liability Incl. w/MAX Various
Automobile Liability KA0142481-0 Reliance National Indemnity
Property* 65060/98 Trochus Ins. Co. Ltd.
Marine Package* ARS-1930 American International
Marine Agency, Inc.
* Indicates policies that are currently under the Kaiser umbrella, but that
will no longer cover the Company on or after the Closing Date.
-------------------
(1) The limited recall coverage currently available under this policy cannot
be renewed or extended beyond April 30, 1999.
Schedule 4.14
Agreements
1. Contribution Agreement
2. Erie Lease Agreement
3. Kaiser Administrative Services Agreement
4. Xxxxxx Production Services Agreement
5. Kaiser Technical Services Agreement
6. Limited Partnership Agreement
7. Limited Liability Company Agreement
8. Aluminum Supply Agreement between the Company and Xxxxxx Aluminum &
Chemical of Canada Limited, a subsidiary of Kaiser ("KACOCL"), pursuant
to which KACOCL supplies aluminum billet to the Company.
9. Aluminum Supply Agreement, including forward purchase commitment, between
the Company and Kaiser, pursuant to which Kaiser supplies aluminum billet
to the Company.
10. Scrap Purchase Agreement between the Company and KACOCL pursuant to which
KACOCL purchase aluminum scrap from the Company.
Exhibit A
Restated Lease
Exhibit B
Form of Kaiser Opinion
April 1, 1999
Accuride Corporation
Accuride Ventures, Inc.
0000 Xxxxx Xxxx
Xxxxxxxxx, Xxxxxxxx 00000
Ladies and Gentlemen:
This opinion is being furnished to you pursuant to Section 6.2(f) of
the Purchase Agreement, dated as of April 1, 1999 (the "PURCHASE AGREEMENT"),
among Xxxxxx Aluminum & Chemical Corporation, a Delaware corporation
("KAISER"), Accuride Corporation, a Delaware corporation ("Accuride"), and
Accuride Ventures, Inc., a Delaware corporation and wholly-owned subsidiary
of Accuride ("ACCURIDE SUB"). Capitalized terms used herein without
definition shall have the meanings specified in the Purchase Agreement.
I am Vice President and General Counsel of Kaiser and I, or attorneys
under my supervision, have acted as counsel to Kaiser in connection with the
preparation of the Purchase Agreement and the Restated Lease.
I, or attorneys under my supervision, have reviewed executed copies of
the Purchase Agreement and the Restated Lease and have also examined and
relied, without independent investigation or verification, upon the
representations and warranties of Kaiser as to factual matters contained in
and made pursuant to the Purchase Agreement, and upon certificates of
officers of Kaiser and the originals, or copies certified or otherwise
identified to my or their satisfaction, of corporate records of Kaiser,
certificates of public officials and such other documents as in our judgment
are necessary or appropriate to render the opinion expressed below. In the
course of the examination of the documents referred to above, I have assumed
the genuineness of all signatures (other than those of the officers of
Kaiser) and the authenticity of all certificates and other documents
submitted to me or to attorneys under my supervision as originals and the
conformity to originals of all documents submitted to me or to attorneys
under my supervision as conformed or photocopies.
Based on the foregoing, I am of the opinion that:
(a) DUE INCORPORATION. Kaiser is a corporation duly incorporated,
validly existing and
in good standing under the laws of the State of Delaware. Kaiser has all
requisite corporate power and authority to execute and deliver the Purchase
Agreement and the Restated Lease, to perform its respective obligations
thereunder, and to consummate the transactions contemplated thereby.
(b) DUE AUTHORIZATION. The execution, delivery and performance by
Kaiser of the Purchase Agreement and the Restated Lease and the consummation
by Kaiser of the transactions contemplated thereby have been duly and validly
authorized by all necessary corporate action on the part of Kaiser. The
Purchase Agreement and the Restated Lease have been duly executed and
delivered by Kaiser, and, assuming the due authorization, execution and
delivery thereof by the other parties thereto, each constitutes a legal,
valid and binding obligation of Kaiser enforceable against Kaiser in
accordance with its respective terms, subject to the effects of bankruptcy,
insolvency, fraudulent conveyance, reorganization, moratorium and other laws
relating to or affecting creditors' rights generally and general equitable
principles (whether considered in a proceeding in equity or at law).
(c) TRANSFER OF KAISER INTERESTS; LEASE OF REAL PROPERTY. The
instruments of conveyance, transfer and assignment executed and delivered by
Kaiser in connection with the transfer of the Kaiser Interests to Accuride
and the Surplus Assets to the Company have been duly authorized, executed and
delivered by Kaiser and are valid and effective to vest in Accuride all of
the right, title and interest of Kaiser in and to the Kaiser Interests and to
vest in the Company all of the right, title and interest of Kaiser in and to
the Surplus Assets, in each case free and clear of any Liens known to us.
The Restated Lease is valid and effective to vest in AKW a valid leasehold
interest and the exclusive right to use and occupy the Additional Premises
except as otherwise set forth in the Restated Lease, free and clear of any
Liens known to us, other than Permitted Real Property Liens.
(d) NO CONFLICTS. The execution, delivery and performance of the
Purchase Agreement and the Restated Lease by Kaiser and the consummation by
Kaiser of the transactions contemplated thereby, do not and will not (i)
conflict with the Certificate of Incorporation or By-Laws of Kaiser, (ii)
constitute a breach or violation of, or default under, any mortgage,
agreement, deed of trust, indenture, lease, contract or other instrument
known by us or by which all of its properties or assets are bound, including
without limitation the Credit Agreement, dated as of February 15, 1994, as
amended, between Kaiser, Xxxxxx Aluminum Corporation, a Delaware corporation,
the various Lenders a party thereto, and BankAmerica Business Credit, Inc., a
Delaware corporation, and all collateral agreements related thereto, except
for such violations as could not reasonably be expected to have (x) a
material adverse effect on Kaiser or (y) a material adverse effect on the
ability of Kaiser to perform its obligations thereunder or (iii) to our
knowledge, result in the creation or imposition of any Liens on any of the
properties or assets of Kaiser, other than Permitted Real Property Liens.
(e) GOVERNMENT AUTHORIZATIONS. To our knowledge, no consent,
approval or authorization of, or filing with, any Governmental Authority of
the States of New York or Delaware or of the federal government of the United
States or any third party is required to be obtained or filed on the part of
Kaiser in connection with the execution and delivery of the
Purchase Agreement and the Restated Lease or the consummation of the
transactions contemplated thereby, other than any consents, approvals,
authorizations or filings the failure to obtain which would not, individually
or in the aggregate, have a Company Material Adverse Effect or have a
material adverse effect on the ability of Kaiser to perform its obligations
under the Purchase Agreement and the Restated Lease.
I call your attention to the fact that I am admitted to practice law
only in the State of California, the Commonwealth of Pennsylvania and the
District of Columbia, and, in rendering the foregoing opinion, I do not
express any opinion as to any laws other than the laws of the State of
California and the Commonwealth of Pennsylvania, the Federal laws of the
United States of America and the General Corporation Law of the State of
Delaware.
This opinion is being delivered to you solely for your benefit, and
neither this opinion nor any part hereof may be delivered to, or used or
relied upon by any other person or for any other purpose without my express
prior written consent.
Very truly yours,
E. Xxxxx Xxxxxx
Vice President and General Counsel
Exhibit C
Surplus Assets Xxxx of Sale
XXXX OF SALE
Xxxxxx Aluminum & Chemical Corporation, a Delaware corporation
("KAISER"), for good and valuable consideration, the sufficiency and receipt
of which is hereby acknowledged, hereby sells, transfers, and delivers to AKW
L.P., a Delaware limited partnership ("AKW"), all of Xxxxxx'x right, title
and interest in and to the assets identified on Exhibit A attached hereto
(collectively, the "SURPLUS ASSETS"). Capitalized terms used but not
otherwise defined in this Xxxx of Sale, including Schedule 1 attached hereto,
shall have the meaning assigned to them in the Purchase Agreement dated as of
April 1, 1999, by and among Accuride Ventures, Inc., a Delaware corporation,
Accuride Corporation, a Delaware corporation, and Kaiser (the "PURCHASE
AGREEMENT")
Kaiser hereby disclaims all other representations or warranties
expressed or implied as to the condition, value or quality of the Surplus
Assets, and specifically disclaims with respect to the Surplus Assets any
representations and warranties of merchantability, usage or fitness for any
particular purpose, it being Xxxxxx'x intent, except as otherwise provided in
the Agreement, to convey the Surplus Assets sold hereby AS IS, WHERE IS.
Notwithstanding the foregoing, Kaiser represents and warrants that Kaiser has
good and marketable title to the Surplus Assets and upon the consummation of
the transactions contemplated hereby, AKW will acquire good and marketable
title to the Surplus Assets free and clear of any and all liens, claims or
encumbrances and Kaiser agrees to indemnify and hold AKW harmless from any
loss, claim or liability arising from the breach of these representations or
warranties.
Kaiser shall execute and deliver such further instruments of transfer
and assignment as AKW may reasonably request to effect the transfer and
assignment of the Surplus Assets to AKW.
IN WITNESS WHEREOF, Kaiser has executed this Xxxx of Sale as of
April 1, 1999.
XXXXXX ALUMINUM & CHEMICAL
CORPORATION
By:
---------------------------
Name: Xxxx X. Xxxxxxx
Title: Vice President
Schedule 1
Exhibit D
Environmental Assets Xxxx of Sale
XXXX OF SALE
Xxxxxx Aluminum & Chemical Corporation, a Delaware corporation
("KAISER"), for good and valuable consideration, the sufficiency and receipt
of which is hereby acknowledged, hereby sells, transfers, and delivers to AKW
L.P., a Delaware limited partnership ("AKW"), all of Xxxxxx'x right, title
and interest in and to the assets identified on Exhibit A attached hereto
(collectively, the "ENVIRONMENTAL ASSETS"). Capitalized terms used but not
otherwise defined in this Xxxx of Sale, including Exhibit A attached hereto,
shall have the meaning assigned to them in the Contribution Agreement among
Accuride Corporation, a Delaware corporation, AKW General Partner L.L.C., a
Delaware limited liability company, AKW and Kaiser dated as of May 1, 1997
(the "CONTRIBUTION AGREEMENT").
Kaiser hereby disclaims all other representations or warranties
expressed or implied as to the condition, value or quality of the
Environmental Assets, and specifically disclaims with respect to the
Environmental Assets any representations and warranties of merchantability,
usage or fitness for any particular purpose, it being Xxxxxx'x intent, except
as otherwise provided in the Agreement, to convey the Environmental Assets
sold hereby AS IS, WHERE IS. Notwithstanding the foregoing, Kaiser represents
and warrants that AKW will acquire good and marketable title to the
Environmental Assets free and clear of any and all liens, claims or
encumbrances and Kaiser agrees to indemnify and hold AKW harmless from any
loss, claim or liability arising from the breach of these representations or
warranties. Nothing contained herein shall be deemed to alter or limit
Xxxxxx'x obligations with respect to the Environmental Compliance Plan under
the Contribution Agreement.
Kaiser shall execute and deliver such further instruments of transfer
and assignment as AKW may reasonably request to effect the transfer and
assignment of the Environmental Assets to AKW.
IN WITNESS WHEREOF, Kaiser has executed this Xxxx of Sale as of
April 1, 1999.
XXXXXX ALUMINUM & CHEMICAL
CORPORATION
By:
---------------------------
Name: Xxxx X. Xxxxxxx
Title: Vice President
Exhibit A
1. All of the machinery and equipment acquired by or on behalf of Kaiser and
installed at the Erie Facility pursuant to the Environmental Compliance
Plan, including, but not limited to, all machinery and equipment relating
to the Wet Venturi Scrubbers (Unit ID Nos. 22-13 and 22-15) located in
Building 12 at the Erie Facility for the 5000 and 8000 ton hydraulic
presses located in Building 22 at the Erie Facility, including hood
enclosures, ductwork, venturi scrubber fan, silencer and stack, process
controls and wash system.
2. To the extent assignable, all of Xxxxxx'x rights and interests in and to
all contracts entered into by or on behalf of Kaiser in connection with
the installation of the foregoing equipment, including all purchase
orders, engineering contracts and construction contracts.
Exhibit E
Assignment and Assumption of Limited Partnership Interest and
Limited Liability Company Interest
ASSIGNMENT AND ASSUMPTION OF LIMITED PARTNERSHIP INTERESTS AND LIMITED LIABILITY
COMPANY INTERESTS
This Assignment and Assumption of Limited Partnership
Interests and Limited Liability Company Interests (the "Agreement") is made
and entered into as of April 1, 1999 (the "Effective Date"), by and between
Xxxxxx Aluminum & Chemical Corporation, a Delaware corporation ("Kaiser"),
and Accuride Corporation, a Delaware corporation ("Accuride"). Capitalized
terms used but not otherwise defined herein shall have the meanings ascribed
thereto in the Purchase Agreement (as defined below).
RECITALS
WHEREAS, Accuride, acting through Accuride Sub, and Kaiser formed the
General Partner, to act as the general partner of AKW L.P., a Delaware
limited partnership ("AKW"); Accuride Sub and Kaiser each own a fifty percent
(50%) membership interest in the General Partner; and Accuride Sub, Kaiser
and Accuride (in its capacity as guarantor of Accuride Sub) entered into the
Limited Liability Company Agreement.
WHEREAS, Accuride Sub and Kaiser each own a forty-nine percent (49%)
limited partnership interest in AKW; the General Partner owns a two percent
(2%) limited partnership interest in AKW; and Accuride Sub, Kaiser, the
General Partner and Accuride (in its capacity as guarantor of Accuride Sub)
entered into the Limited Partnership Agreement.
WHEREAS, Accuride desires to purchase, and Kaiser desires to sell,
Xxxxxx'x fifty percent (50%) Interest (as defined in the Limited Liability
Company Agreement) in the General Partner, Xxxxxx'x forty-nine percent (49%)
Interest (as defined in the Limited Partnership Agreement) in AKW
(collectively, the "Kaiser Interests") pursuant to a Purchase Agreement (the
"Purchase Agreement") dated as of March 31, 1999 by and among Accuride,
Kaiser and Accuride Sub, whereby upon consummation of the Transactions (as
defined below in the Purchase Agreement), Accuride Sub and Accuride shall
collectively hold one hundred percent (100%) of the Interest (as defined in
the Limited Liability Company Agreement) in the General Partner and a
ninety-eight percent (98%) Interest (as defined in the Limited Partnership
Agreement) in AKW.
WHEREAS, pursuant to the Purchase Agreement, Kaiser
hereby desires to assign to Accuride, and Accuride desires to accept an
assignment from Kaiser of, the entirety of Xxxxxx'x Interests, together with
all rights, duties and obligations related thereto (the "Transferred
Interest"), and each of them intends concurrently therewith that Accuride
shall become a substitute Limited Partner of AKW and a substitute Member of
the General Partner, as applicable, with respect to the Transferred Interest,
subject to the terms of the Limited Partnership Agreement and the Limited
Liability Company Agreement, as applicable, and this Agreement.
WHEREAS, General Partner has consented to the assignment
of Xxxxxx'x
forty-nine percent (49%) Interest (as defined in the Limited Partnership
Agreement) pursuant to that certain Consent dated as of the date hereof.
AGREEMENT
NOW, THEREFORE, in consideration of the mutual covenants
contained herein, and for other good and valuable consideration, the receipt
and sufficiency which are hereby acknowledged, the parties hereto, intending
to be legally bound, agree as follows:
A. AGREEMENT TO ASSIGN AND ACCEPT TRANSFERRED INTEREST
Effective as of April 1, 1999:
1. Kaiser assigns and transfers to Accuride all right,
title and interest in and to the entirety of the Transferred Interest.
2. Accuride accepts the assignment and transfer from
Kaiser of said Transferred Interest and agrees to be bound by the terms of
the Limited Partnership Agreement and the Limited Liability Company Agreement.
B. INTENT OF SUBSTITUTION
Accuride shall succeed Kaiser as a Limited Partner of AKW and a
Member of the General Partner and Kaiser shall have no further interest
whatsoever in AKW and the General Partner. Kaiser and Accuride hereby agree
to execute such other instruments, and take such other actions, as may be
deemed necessary to admit Accuride as a substitute Limited Partner of AKW and
substitute Member of the General Partner.
IN WITNESS WHEREOF, the parties have executed this Assignment
and Assumption of Limited Partnership Interests and Limited Liability Company
Interests as of the day and year first above written.
Xxxxxx Aluminum & Chemical Corporation,
a Delaware corporation
By:
---------------------------
Name: Xxxx X. Xxxxxxx
Title: Vice President
Accuride Corporation,
a Delaware corporation
By:
---------------------------
Name:
-------------------------
Title:
------------------------
Exhibit F
Acknowledgment of Limited Partnership Interest and Limited
Liability Company Interest
ACKNOWLEDGMENT OF LIMITED PARTNERSHIP INTEREST AND LIMITED
LIABILITY COMPANY INTEREST
Pursuant to a Purchase Agreement (the "Purchase
Agreement") dated as of April 1, 1999 by and among Xxxxxx Aluminum & Chemical
Corporation, a Delaware corporation ("Kaiser"), Accuride Corporation, a
Delaware corporation ("Accuride"), and Accuride Ventures, Inc., a Delaware
corporation and a wholly owned subsidiary of Accuride ("Accuride Sub"), this
certificate acknowledges that Accuride will become the holder of fifty
percent (50%) Interest (as defined in the Limited Liability Company
Agreement) in the General Partner and forty-nine percent (49%) Interest (as
defined in the Limited Partnership Agreement) in the Company, upon the
execution of the attached Assignment and Assumption of Limited Partnership
Interests and Limited Liability Company Interests by Kaiser and Accuride of
even date herewith. Capitalized terms used herein without definition shall
have the meanings ascribed to them in the Purchase Agreement.
IN WITNESS WHEREOF, this Acknowledgment of Limited Partnership
Interests and Limited Liability Company Interests is executed as of April 1,
1999.
XXXXXX ALUMINUM & CHEMICAL CORPORATION
By:
---------------------------
Name: Xxxx X. Xxxxxxx
Title: Vice President
Exhibit G
Acknowledgment and Certificate
Acknowledgment and Certificate
Acknowledgment and Certificate dated as of April 1, 1999, by AKW L.P.,
a Delaware limited partnership (the "Company"), and AKW General Partner
L.L.C., a Delaware limited liability company (the "General Partner").
WHEREAS, Accuride Ventures, Inc., a Delaware corporation and
wholly-owned subsidiary of Accuride Corporation ("Accuride Sub"), Accuride
Corporation, a Delaware corporation ("Accuride"), and Xxxxxx Aluminum &
Chemical Corporation, a Delaware corporation ("Kaiser") have entered into
that certain Purchase Agreement dated as of April 1, 1999 (the "Purchase
Agreement"), pursuant to which Kaiser is selling all of its interests in the
Company and the General Partner to Accuride;
WHEREAS, the Purchase Agreement contains certain terms and conditions
which affect the Company and the General Partner and modify the terms of the
Limited Liability Company Agreement and the Limited Partnership Agreement;
and
WHEREAS, Section 6.3(c) of the Purchase Agreement requires the
execution and delivery of this Acknowledgment and Certificate as a condition
to Xxxxxx'x obligations thereunder.
NOW, THEREFORE, the Company and the General Partner, intending to be
legally bound hereby, each acknowledge and certify the following:
1. DEFINITIONS. Capitalized terms used but not otherwise defined in this
Acknowledgment and Certificate shall have the meanings assigned to them
in the Purchase Agreement.
2. INSURANCE. To its knowledge, (i) the policies or binders of insurance as
identified on Schedule 4.8 of the Purchase Agreement which the Company is
the owner, insured or beneficiary are in full force and effect on the
date hereof and, (ii) except as otherwise set forth on Schedule 4.8,
shall be kept in full force and effect through April 30, 1999.
3. TAX MATTERS. To its knowledge, (i) Kaiser has acted as the tax matters
partner under the Partnership Agreements in accordance with the terms
thereof, (ii) the Company and the General Partner have not received a
ruling from any taxing authority or signed an agreement with any taxing
authority that could reasonably be expected to have a Company Material
Adverse Effect, and (iii) there is no expectation that any taxing
authority may claim or assess any new or additional Taxes payable by the
Company or the General Partner for any period ending on or prior to the
Closing Date that could reasonably be expected to have a Company Material
Adverse Effect.
4. ADDITIONAL PREMISES. To its knowledge, (ii) there is no violation of any
restriction, condition, covenant or agreement applicable to or affecting
the Additional Premises, any part thereof or use thereof, contained in
any deed, subdivision map or other instrument, except which, individually
or in the aggregate, would not reasonably be expected to have
a Company Material Adverse Effect, and (ii) Kaiser and/or the Company
have all easements, rights of way and similar authorizations required for
the ownership and use of the Additional Premises by the Company for the
conduct of its business as currently conducted.
5. CLAIMS. Following the Closing, to its knowledge, it will not have any
outstanding (i) claims against Kaiser or any of Xxxxxx'x Affiliates
arising from or in connection with the breach or alleged breach of any
agreement pursuant to which Kaiser or any of Xxxxxx'x Affiliates is a
party, or (ii) receivables from Kaiser or any of Xxxxxx'x Affiliates
other than trade receivables arising in the ordinary course of business.
6. CONTRIBUTION AGREEMENT. To its knowledge, upon the Closing of the
Transactions, Kaiser will have satisfied any known obligations to it
under the Contribution Agreement and the Erie Lease Agreement and with
respect to the Landlord's Work (as defined in the Erie Lease Agreement).
7. AGREEMENTS. To its knowledge, Schedule 4.14 of the Purchase Agreement
sets forth all existing material agreements, contracts, leases, purchase
orders, undertakings, understandings, covenants not to compete,
confidentiality agreements, licenses, obligations or other commitments,
whether oral or written, currently in effect between Kaiser and any of
its subsidiaries, on one hand, and the Company or the General Partner, on
the other hand.
8. TERMINATION OF CERTAIN AGREEMENTS. Unless sooner terminated upon the
mutual written agreement of the parties thereto and except as otherwise
set forth herein, each of the Kaiser Technical Services Agreement and the
Xxxxxx Production Services Agreement shall, and shall be deemed to,
terminate on August 31, 1999. Unless sooner terminated upon the mutual
written agreement of the parties thereto and except as otherwise set
forth herein, the Kaiser Administrative Services Agreement shall, and
shall be deemed to, terminate on August 31, 1999, with respect to all
services currently being provided by Kaiser thereunder other than tax
services which shall continue through the timely preparation and filing
of the tax returns specified in Section 8.10 of the Purchase Agreement.
Kaiser shall, pursuant to the terms of those agreements, continue to be
paid and reimbursed for any such services that it continues to provide.
9. TERMINATION OF CERTAIN SERVICES. Effective as of April 2, 1999, or such
other date mutually agreed to in writing by the parties hereto, Accuride
or Accuride Sub, shall assume control of all of the cash management,
treasury and hedging activities currently being performed by Kaiser for
the General Partner and the Company.
10. RECALL CAMPAIGN. Notwithstanding any other provision to the contrary
contained in the Contribution Agreement, any other Formation Agreement or
otherwise, the Company shall be solely responsible for the Recall
Campaign and all liabilities, costs and expenses of the Recall Campaign
(the "Recall Costs") and Kaiser shall not have any liability to the
Company, the General Partner, Accuride, Accuride Sub or any of their
Affiliates for the
3
Recall Costs, whenever incurred. This paragraph does not create
additional indemnification rights except as set forth in the Formation
Agreements and indemnification against the Company for the Recall Costs.
Notwithstanding the foregoing, the parties hereto agree that the cause
of the Recall Campaign has not been mutually agreed upon by the parties
hereto and that this paragraph does not amend, limit or otherwise modify
in any manner any of the respective parties's rights and obligations
under the Formation Agreements for any other liabilities, costs or
expenses arising from the wheels which are the subject of the Recall
Campaign, including third party claims or any claims based on product
defects.
11. COVENANT NOT TO COMPETE. Effective as of the Closing Date, neither
Kaiser, Accuride, Accuride Sub nor any of their respective Affiliates
shall have any obligations under Section 11.2 of each of the Partnership
Agreements. In lieu of the foregoing, Section 8.5 of the Purchase
Agreement shall set forth the limitations on Xxxxxx'x activities in that
regard.
12. INSPECTION OF BOOKS AND RECORDS. (a) Following the Closing, Kaiser
and/or its representatives and agents, at Xxxxxx'x expense and at
reasonable times during business hours, shall have the right to inspect
and make copies and extracts of all books of account and all financial,
legal and business records (which books of account, financial, legal and
business records shall be retained for not less than seven years after
the Closing Date) of (i) the Company and the General Partner, as well as
access to, and the cooperation of, any employee of the Company or General
Partner having knowledge of the information therein contained and the
right to discuss the matters recorded in such books and records with the
independent certified accountants retained by the Company and/or General
Partner, in each instance if such inspection, access and cooperation are
for any reasonable purpose, including without limitation (1) preparation
for proceedings, claims, actions, suits, investigations or disputes to
which Kaiser is a party relating to the conduct of the business prior to
the Closing Date by Kaiser, Accuride, the Company and/or the General
Partner, (2) any proceedings, claims, actions, suits, investigations or
disputes between Kaiser and the Company, the General Partner, Accuride
and/or Accuride Sub relating to the conduct of the business prior to the
Closing Date by Kaiser, Accuride, the Company and/or the General Partner,
(3) performance of accounting or tax reviews or audits of the business
conducted by the Company or the General Partner relating to periods prior
to the Closing Date or (4) any purpose reasonably related to Xxxxxx'x
ownership of its Interest in the Company and/or the General Partner;
provided, that such inspection, access or cooperation shall not
unreasonably interfere with the normal operations of the Company and
Kaiser and/or its representatives shall not be entitled to any such
inspection, access or cooperation (i) as to which the attorney-client
privilege applies or (ii) the disclosure of which is restricted
Applicable Law except in strict compliance with such law.
13. PROPERTY TAXES. Property taxes for 1999 shall be allocated to the short
period ending on the Closing Date based on the actual number of calendar
days in each period (it being understood that the foregoing shall not
alter, amend or otherwise modify the terms of the Restated Lease).
4
14. TAX RETURNS. Kaiser shall be responsible for the timely preparation of
all 1998 tax returns required to be filed for the General Partner and the
Company consistent with past practice in accordance with the Partnership
Agreements and the Kaiser Administrative Services Agreement. Kaiser
shall also be responsible for the timely preparation of 1999 tax returns
for the period through the Closing Date. With respect to the period from
January 1, 1999 through the Closing Date, no elections shall be made or
positions taken that are not consistent with past practice. Kaiser shall
remain the owner of the Kaiser Interests for income tax purposes through
the Closing Date.
15. CONFIDENTIAL INFORMATION. Effective as of the Closing Date Kaiser shall
not have any obligations under Section 11.1 of each of the Partnership
Agreements. In lieu thereof, effective as of the Closing Date Kaiser
obligations with respect to confidential information shall be governed by
Section 8.16 of the Purchase Agreement.
16. USE OF NAMES. Neither the Company nor the General Partner will, directly
or indirectly, use in any manner whatsoever, or allow any of their
respective Affiliates to use in any manner whatsoever, the Kaiser Marks
after the Closing Date. Notwithstanding the foregoing, the Company and
the General Partner may continue to use the Kaiser Marks during the six
month period beginning on the Closing Date in connection with the use of
existing inventories or materials and supplies containing any such Kaiser
Marks.
17. DISTRIBUTIONS. The General Partner and the Company shall have been
deemed to have authorized pursuant to Sections 5.1 of Limited Partnership
Agreement and the Limited Liability Company Agreement, respectively,
distributions in an amount equal to net cash distributions received by
Accuride Sub and Kaiser from the General Partner and the Company at any
time through March 31, 1999, in connection with the sweeping of the
accounts maintained by the Company and/or General Partner and
distribution of such amounts to Accuride Sub and Kaiser in the ordinary
course of business of the Company and the General Partner.
18. ENGINEERING STORES. Within thirty (30) days of the Closing Date, the
Company shall return to Kaiser all surplus engineering stores in its
possession for which it has not reimbursed Kaiser.
19. FUNDING REQUIREMENTS. From and after the date hereof, Accuride and
Accuride Sub shall assume the financial obligations of the Company and
the General Partner, fund one hundred percent (100%) of the cash
infusions required by the Company and the General Partner and receive one
hundred percent (100%) of the cash distributions from the Company and the
General Partner made in the ordinary course of business and consistent
with past practice.
20. KNOWLEDGE. For purposes of this Acknowledgment and Certificate,
knowledge with respect to the Company and the General Partner shall mean
the actual knowledge of Xxxxxxx Xxxxxxxx, Xxxx Xxxxxx and Xx Xxxx.
5
21. FORMATION AGREEMENTS. Each of the General Partner, the Company and
Kaiser agrees that the representations and warranties set forth in
Sections 2 through 7 of this Acknowledgment and Certificate shall not
amend, limit or otherwise modify in any manner any of the respective
parties' rights and obligations under any of the Formation Agreements;
provided, however that the foregoing shall not preclude Kaiser from
asserting a claim hereunder arising from a breach of any such
representation or warranty.
IN WITNESS WHEREOF, the Company and General Partner have caused this
Acknowledgment and Certificate to be duly executed in their respective
corporate names by their respective officers, each of whom is duly and
validly authorized and empowered, all on and as of the date first above
written.
AKW L.P., by its sole general partner, AKW GENERAL PARTNER L.L.C.
AKW GENERAL PARTNER L.L.C.,
By: By:
-------------------------- ---------------------------
Name: Name:
------------------------ -------------------------
Title: Title:
------------------------ -------------------------
Agreed and Acknowledged:
XXXXXX ALUMINUM & CHEMICAL
CORPORATION
By:
--------------------------
Name: Xxxx X. Xxxxxxx
Title: Vice President
CERTIFICATION PURSUANT TO INTERNAL REVENUE CODE SECTION 1445
Section 1445 of the Internal Revenue Code of 1986 (the "Code") provides
that a transferee of a U.S. real property interest, as defined in Section
897(c) of the Code, must withhold tax if the transferor is a foreign person.
To inform the transferee that withholding of tax is not required upon the
disposition by Xxxxxx Aluminum & Chemical Corporation (the "Company") to
Accuride Corporation of all of the Company's interests in AKW L.P. and AKW
General Partner L.L.C. (collectively, the "Kaiser Interests"), the
undersigned hereby certifies the following on behalf of the Company:
1. The Company is not a nonresident alien, foreign corporation, foreign
partnership, foreign trust, or foreign estate (as those terms are defined
in the Code and/or Treasury regulations);
2. The Kaiser Interests do not constitute a "U.S. real property interest"
(as defined in Section 897(c) of the Code);
2. The Company's U.S. taxpayer identification number is 00-0000000; and
3. The Company's address is: 0000 Xxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
The Company understands that this certification may be disclosed to
the Internal Revenue Service by the transferee and that any false statement
contained herein could be punished by fine, imprisonment, or both.
Under penalties of perjury I declare that I have examined this
certification and to the best of my knowledge and belief it is true, correct,
and complete, and I further declare that I have authority to sign this
document on behalf of the Company.
XXXXXX ALUMINUM & CHEMICAL
CORPORATION
By:
---------------------------
Name: Xxxx X. Xxxxxxx
Title: Vice President
Funds Flow Memorandum
This memorandum describes the flow of funds in connection with the
sale of the Kaiser Interests to Accuride Corporation, a Delaware corporation
("ACCURIDE"), pursuant to the terms of the Purchase Agreement dated as of
April 1, 1999, by and among Accuride Ventures, Inc., a Delaware corporation
and wholly-owned subsidiary of Accuride ("ACCURIDE SUB"), Xxxxxx Aluminum &
Chemical Corporation, a Delaware corporation ("KAISER"), and Accuride (the
"PURCHASE AGREEMENT"). Capitalized terms used but not otherwise defined in
this memorandum have the meanings assigned to them in the Purchase Agreement:
Amount Payable To Amount Payable To Amount Payable To
Item or Issue (By) Kaiser (By) Accuride (By) the Company
------------- ----------------- ----------------- -----------------
Purchase Price $71,000,000.00 ($71,000,000.00) $ 0.00
Phase I Improvements and (143,813.99) 0.00 143,813.99
Environmental Compliance Plan
Water Main Break (5,898.71) 0.00 5,898.71
Mellon Leasing (double payment)* (46,709.05) 0.00 46,709.05
Xxx Xxxxx (3,024.23) 0.00 3,024.23
Arbon Equip. Corp. (door repair) (4,298.04) 0.00 4,298.04
Clerical Temp. (218.50) 0.00 218.50
Erie Utilities (7/98 through 3/99) (90,000.00) 0.00 90,000.00
Estimated Cash Adjustment (265,000.00) 265,000.00 0.00
Totals: $70,441,037.48 ($70,735,000.00) $293,962.52
*Kaiser is assuming that the Company's position is accurate for purposes
hereof without prejudicing its position in the event the Company's position
is in error.
