PURCHASE AND SALE
AGREEMENT, dated as of
February 4, 2005 (this
"Agreement"), between the
parties set forth on Annex
A hereto (each, a "Buyer"
and collectively, the
"Buyers") and Xxxxxx
Holdings, LLC, a Delaware
limited liability company
("Seller").
RECITALS
WHEREAS, Seller is the sole beneficial owner of 2,174,418 shares of common
stock, par value $0.01 per share (the "Shares"), of AEP Industries Inc., a
Delaware corporation (the "Company");
WHEREAS, Seller desires to sell to the Buyers, and the Buyers desire to
purchase from Seller, free and clear of any and all Encumbrances (as defined
below), 2,174,268 of the Shares (the Purchased Shares"); and
NOW, THEREFORE, in consideration of the premises and of the mutual
covenants, agreements and warranties herein contained, and for other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto agree as follows:
1. Purchase and Sale.
Subject to the terms and conditions herein set forth, each Buyer agrees to
purchase the Purchased Shares set forth opposite its name on Schedule I, and
Seller agrees to sell such Purchased Shares to each Buyer, at a per share price
of $16.30, for the purchase price set forth opposite each such Buyer's name on
Schedule I, for an aggregate purchase price of $35,440,568.40 (the "Purchase
Price") on the Closing Date (as defined below).
2. Representations and Warranties of the Buyers.
Each Buyer hereby represents and warrants, jointly and severally with
respect to each other Buyer (other than Xxxxxxx Xxxxx Xxxxxx, who makes such
representations and warranties only with respect to himself and with respect to
whom no other Buyer makes any representation or warranty), to Seller as follows:
(a) Due Organization. If such Buyer is an entity, such Buyer is duly
organized, validly existing and in good standing under the laws of the
jurisdiction of its organization.
(b) Authorization; Non-Contravention. Such Buyer has the requisite legal
power and authority to enter into this Agreement and to perform the transactions
and agreements contemplated hereby and to carry out its obligations hereunder.
This Agreement has been duly authorized, executed and delivered by such Buyer
and, upon the due execution hereof by Seller, constitutes a valid and binding
agreement enforceable
against such Buyer in accordance with its terms, except that the enforcement
thereof may be subject to (i) bankruptcy, insolvency, reorganization, fraudulent
conveyance, moratorium or other similar laws now or hereafter in effect relating
to creditors' rights generally, (ii) general principles of equity and the
discretion of the court before which any proceeding therefor may be brought
(regardless of whether such enforcement is considered in a proceeding in equity
or at law) and (iii) public policy considerations. Neither the execution and
delivery of this Agreement, the consummation of the transactions and agreements
contemplated hereby, nor compliance with the terms, conditions or provisions
hereof, will (i) result in a violation of any of the terms, conditions or
provisions of such Buyer's organizational documents (if applicable), (ii) result
in a violation of any law, rule or regulation applicable to such Buyer, or (iii)
constitute a default or create a right of termination or acceleration under any
material agreement or instrument to which such Buyer is a party, except in the
case of clause (ii) or (iii) for such violations, defaults or rights of
termination or acceleration that would not result in a material adverse effect
upon such Buyer's ability to perform its obligations or consummate the
transactions hereunder.
(c) No Public Sale or Distribution. Such Buyer is acquiring the Purchased
Shares in the ordinary course of business for its own account and not with a
view towards, or for resale in connection with, the public sale or distribution
thereof, except pursuant to sales registered or exempted from registration under
the Securities Act of 1933, as amended (the "Securities Act"), and such Buyer
does not have a present intention to effect any distribution of the Purchased
Shares to or through any person or entity; provided, however, that by making the
representations herein, such Buyer does not agree to hold any of the Purchased
Shares for any minimum or other specific term and reserves the right to dispose
of the Purchased Shares at any time in accordance with or pursuant to a
registration statement or an exemption from the registration requirements under
the Securities Act. Notwithstanding the above, Xxxxxxx Xxxxx Xxxxxx makes no
representation regarding the acquisition of any Purchased Shares by him
hereunder being in the ordinary course of his business.
(d) Transfer or Resale. Such Buyer is aware that the sale of the Purchased
Shares to it by Seller is being made in reliance upon an exemption from the
registration requirements of the Securities Act. Such Buyer understands that the
Purchased Shares have not been and are not being registered under the Securities
Act or any state securities laws, and may not be offered for sale, sold or
transferred unless subsequently registered thereunder or an exemption from such
registration is available.
(e) Risk. Such Buyer understands that its investment in the Purchased
Shares involves a high degree of risk and it is able to bear the economic risk
of an investment in the Purchased Shares, including the complete loss of such
Buyer's investment in the Purchased Shares, for any indefinite period of time.
(f) Accredited Investor. Such Buyer represents that it is an "accredited
investor" as that term is defined in Rule 501(a) of Regulation D of the
Securities Act.
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(g) Buyer Status. Such Buyer (i) is a sophisticated person with respect to
the sale of the Purchased Shares; (ii) has adequate information concerning the
business and financial condition of the Company to make an informed decision
regarding the purchase of the Purchased Shares; and (iii) has independently and
without reliance upon Seller, and based on such information as such Buyer has
deemed appropriate, made its own analysis and decision to enter into this
Agreement, except that such Buyer has relied upon Seller's representations,
warranties and covenants in this Agreement. Such Buyer acknowledges that Seller
has not given such Buyer any investment advice, credit information or opinion on
whether the purchase of the Purchased Shares is prudent. Such Buyer has had
access to such financial and other information concerning Seller and the Company
as it deemed necessary and appropriate in order to make an informed investment
decision with respect to the purchase of the Purchased Shares contemplated by
this Agreement, including the opportunity to ask questions of and request
information from certain of Seller's advisors.
(h) Knowledge. Such Buyer understands that Seller may possess and have
access to material non-public information which has not been communicated to
such Buyer. Such Buyer hereby waives any and all claims it may have or may
hereafter acquire against Seller relating to any failure to disclose such
material non-public information to such Buyer.
(i) No Brokers. Such Buyer has taken no action that would give rise to any
claim by any person for brokerage commissions, finder's fees or similar payments
relating to this Agreement or the transactions contemplated thereby.
(j) Reliance. Such Buyer understands that Seller is relying upon the
representations and warranties contained in this Section 2 in connection with
the sale of the Purchased Shares to such Buyer and the transactions contemplated
hereby.
(k) No Other Representations. Other than such Buyer's representations and
warranties contained in this Section 2, neither it nor any other person makes
any express or implied representation or warranty on behalf of or with respect
to such Buyer, and such Buyer and each of its representatives hereby disclaim
any such representation or warranty, whether by such Buyer, the Company or any
of their respective representatives or any other person, with respect to the
execution and delivery of this Agreement, the consummation of the transactions
contemplated hereby or the Company or such Buyer, notwithstanding the delivery
or disclosure to Seller or any of its representatives or any other person of any
documentation or other information by such Buyer, the Company or any of their
respective representatives or any other person with respect to any one or more
of the foregoing.
3. Representations and Warranties of Seller.
Seller hereby represents and warrants to the Buyers as follows:
(a) Due Organization. Seller is duly organized, validly existing and in
good standing under the laws of the State of Delaware.
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(b) Authorization; Non-Contravention. Seller has the requisite legal power
and authority to enter into this Agreement and the transactions and to perform
the transactions and agreements contemplated hereby and to carry out its
obligations hereunder. This Agreement has been duly authorized, executed and
delivered by Seller and, upon the due execution hereof by each Buyer,
constitutes a valid and binding agreement enforceable against the Seller in
accordance with its terms, except that the enforcement thereof may be subject to
(i) bankruptcy, insolvency, reorganization, fraudulent conveyance, moratorium or
other similar laws now or hereafter in effect relating to creditors' rights
generally, (ii) general principles of equity and the discretion of the court
before which any proceeding therefor may be brought (regardless of whether such
enforcement is considered in a proceeding in equity or at law) and (iii) public
policy considerations. Neither the execution and delivery of this Agreement, the
consummation of the transactions and agreements contemplated hereby, nor
compliance with the terms, conditions or provisions hereof, will (i) result in a
violation of any of the terms, conditions or provisions of Seller's
organizational documents, (ii) result in a violation of any law, rule or
regulation applicable to Seller, or (iii) constitute a default or create a right
of termination or acceleration under any material agreement or instrument to
which Seller is a party, except in the case of clause (ii) or (iii) for such
violations, defaults or rights of termination or acceleration that would not
result in a material adverse effect upon Seller's ability to perform its
obligations or consummate the transactions hereunder.
(c) Title. Seller is the sole record and beneficial owner of the Purchased
Shares. Seller has good and valid title to the Purchased Shares, free and clear
of any lien, encumbrance, claim, security interests, pledge, charge, voting or
other restriction, right of first refusal or first offer, option, or other
similar arrangement or interest, except for those imposed by applicable
securities laws and as provided in the Governance Agreement (as defined below)
(collectively, "Encumbrances").
(d) Governance Agreement. Attached hereto as Exhibit A is a true, correct
and complete copy of the Governance Agreement, dated as of June 20, 1996,
between Seller and the Company, as amended on October 11, 1996 and in effect on
the date hereof (the "Governance Agreement"). The Governance Agreement has not
been further amended, restated, supplemented or otherwise modified in any
material respect. To the Seller's Knowledge, other than the Governance
Agreement, the Company's certificate of incorporation and by-laws, and any
applicable Laws, there are no written agreements, instruments or arrangements to
which Seller is a party or to which it is otherwise bound affecting or relating
to the Purchased Shares or the rights appurtenant thereto. For purposes of this
Section 3(d), (i) "Seller's Knowledge" means the actual knowledge of the
Seller's current Chief Financial Officer and General Counsel and the Seller's
designees on the Board of Directors of the Company; and (ii) "Law" means any
foreign, federal, state or local law, statute, treaty, rule, directive,
regulation, ordinance and similar provisions having the force or effect of law
or any judgments, writs, decrees, compliance agreements, injunctions or judicial
or administrative orders and determinations of any governmental authority or
instrumentality, whether federal, state, local or foreign and whether
legislative, executive, judicial or otherwise.
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(e) No Other Representations. Other than Seller's representations and
warranties contained in this Section 3, neither Seller nor any other person
makes any express or implied representation or warranty on behalf of or with
respect to Seller, and Seller and each of its representatives hereby disclaim
any such representation or warranty, whether by Seller, the Company or any of
their respective representatives or any other person, with respect to the
execution and delivery of this Agreement, the consummation of the transactions
contemplated hereby or the Company or Seller, notwithstanding the delivery or
disclosure to the Buyers or any of their representatives or any other person of
any documentation or other information by Seller, the Company or any of their
respective representatives or any other person with respect to any one or more
of the foregoing.
4. Closing.
The purchase and sale of the Purchased Shares (the "Closing") shall occur
on the date hereof (the "Closing Date"). The Closing shall take place at the
offices of O'Melveny & Xxxxx LLP, located at Times Square Tower, 0 Xxxxx Xxxxxx,
Xxx Xxxx, Xxx Xxxx 00000, at which time the parties shall deliver the documents
and instruments described below:
(a) Deliveries by the Buyers. At the Closing, the Buyers shall deliver or
cause to be delivered to Seller an amount equal to the Purchase Price by wire
transfer of immediately available funds to the account specified by Seller on
Schedule II hereto.
(b) Deliveries by Seller. At the Closing, Seller shall deliver or cause to
be delivered to the Buyers the Purchased Shares, free and clear of any and all
Encumbrances, accompanied by a power duly executed in blank and sufficient to
convey to the Buyers good and valid title in and to the Purchased Shares.
5. Covenants.
(a) Disclosure Cooperation. Each party hereto shall consult in advance (but
require no consent) with the others as to the content of any communication to
any governmental authority or public disclosure relating to the transactions
contemplated hereby.
(b) Retained Shares. From and after the date hereof, Seller shall not,
without the prior written consent of the Buyers holding a majority of the
Purchased Shares, transfer, sell or otherwise dispose of any rights in, under or
to the 150 Shares not sold to the Buyers pursuant to this Agreement.
(c) Rights Under Governance Agreement. With respect to the Governance
Agreement, Seller shall (i) at the time of or prior to the Closing, deliver the
notices to the Company specified in Sections 6.2 and 6.13 of the Governance
Agreement with respect to the transactions contemplated hereby and (ii) cause
its counsel to deliver the opinion specified in Section 6.2 of the Governance
Agreement, which opinion shall be reasonably acceptable to the Buyers. From and
after the Closing, each Buyer hereby agrees to be bound by the terms of the
Governance Agreement as a Holder (as defined in the
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Governance Agreement) with respect to the Purchased Shares held thereby, and to
deliver to the Company the written agreement specified in clause (ii) of the
second proviso of Section 6.13 of the Governance Agreement, attached hereto as
Exhibit B.
(d) Amendment or Waiver of Governance Agreement. Seller shall not amend or
waive (or otherwise agree in any respect to do any of the same with respect to)
any provision of the Governance Agreement without the prior written consent of
the Buyers holding a majority of the Purchased Shares, which consent shall not
be unreasonably withheld.
(e) Further Assurances. From and after the date hereof, each party hereto
shall execute all certificates, instruments, documents or agreements and shall
take any other action (including, without limitation, reasonably aiding and
assisting in any efforts to enforce rights under the Governance Agreement) which
it is reasonably requested to execute or take by any other party hereto to
further effectuate the respective rights and obligations of the parties hereto,
and to consummate and make effective the transactions, under and as contemplated
by this Agreement. All reasonable and documented costs and expenses incurred by
either party pursuant to this subsection shall be borne by the party so
requesting such action, aid or assistance.
6. Miscellaneous.
(a) Successors and Assigns. This Agreement shall be binding upon, and inure
to the benefit of, the parties hereto and their respective successors and
assigns.
(b) Notices. All notices or other communications which are required or
otherwise delivered hereunder shall be deemed to be sufficient and duly given if
contained in a written instrument and personally delivered or sent by
telecopier; sent by nationally-recognized overnight courier guaranteeing next
business day delivery; or sent by first class registered or certified mail,
postage prepaid, return receipt requested, addressed as follows:
(i) if to a Buyer, to it at the address set forth under its name on
Annex A hereto:
with a copy to:
Xxxxxxx Xxxx & Xxxxxxxxx, LLP
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxx X. Xxxxxxxx, Esq.
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
(ii) if Seller, to it at:
c/o Apollo Management, L.P.
0 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx Xxxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
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with a copy to:
O'Melveny & Xxxxx LLP
Times Square Tower
0 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxx Xxxxx, Esq.
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
or to such other address as the party to whom notice is to be
given may have furnished to each other party in writing in accordance herewith.
Any such notice or communication shall be deemed to have been received (i) when
delivered, if personally delivered or sent by telecopier; (ii) on the first
business day after dispatch, if sent by nationally recognized, overnight courier
guaranteeing next business day delivery; and (iii) on the fifth business day
following the date on which the piece of mail containing such communication is
posted, if sent by mail.
(c) Entire Agreement; No Third Party Beneficiaries. This Agreement
(including any exhibits, schedules and amendments hereto) (a) constitutes the
entire Agreement and understandings of the parties hereto and supersedes all
prior agreements and understandings, both written and oral, between the parties
hereto with respect to the subject matter hereof and (b) is not intended to
confer upon any other person other than the parties hereto any rights or
remedies hereunder.
(d) Expenses. Regardless of whether the transactions contemplated hereby
are consummated, each party hereto shall pay its own expenses incident to
preparing for, entering into and carrying out this Agreement and the
consummation of the transactions contemplated hereby.
(e) Amendments; Waiver and Release. The terms and provisions of this
Agreement may not be modified or amended, nor may any of the provisions hereof
be waived, temporarily or permanently, except pursuant to a written instrument
executed by each party hereto. No failure by any party hereto to insist upon the
strict performance of any covenant, duty, agreement or condition of this
Agreement, or to exercise any right or remedy consequent upon a breach hereof,
shall constitute a waiver of any such breach or any other covenant, duty,
agreement or condition hereof.
(f) Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original but all of which shall
constitute one and the same instrument.
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(g) Governing Law. This Agreement shall be governed by, and construed and
enforced in accordance with, the laws of the State of Delaware (without regard
to the conflicts of laws principles thereof).
(h) Jurisdiction. The parties agree that any suit, action or proceeding
arising out of, or with respect to, this Agreement or any judgment entered by
any court in respect thereof shall be brought in the courts of the State of
Delaware or in the U.S. District Courts, in either case, located in Wilmington,
Delaware and the Buyers and Seller hereby irrevocably accept the exclusive
personal jurisdiction of those courts for the purpose of any suit, action or
proceeding. In addition, the Buyers and Seller each hereby irrevocably waive, to
the fullest extent permitted by law, any objection which it may now or hereafter
have, to the laying of venue of any suit, action or proceeding arising out of or
relating to this Agreement or any judgment entered by any court in respect
thereof brought in the State of Delaware or the U.S. District Courts located in
Wilmington in the State of Delaware, and hereby further irrevocably waives any
claim that any suit, action or proceedings brought in any such court has been
brought in an inconvenient forum.
(i) Severability. If it is determined by a court of competent jurisdiction
that any provision of this Agreement is invalid or unenforceable under
applicable law, such provision shall be ineffective only to the extent of such
invalidity or unenforceability, without invalidating the remainder of the
Agreement.
* * * * *
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IN WITNESS WHEREOF, the parties hereto have caused this Purchase and
Sale Agreement to be executed and delivered as of the day and year first
executed.
THIRD POINT PARTNERS QUALIFIED L.P.
By: Third Point Advisors LLC,
its general partner
By: /s/ Xxxxx Xxxxxxxx
------------------------------------
Name: Xxxxx Xxxxxxxx
Title: Chief Financial Officer
THIRD POINT PARTNERS L.P.
By: Third Point Advisors LLC,
its general partner
By: /s/ Xxxxx Xxxxxxxx
------------------------------------
Name: Xxxxx Xxxxxxxx
Title: Chief Financial Officer
BANZAI PARTNERS L.P.
By: Third Point Advisors LLC,
its general partner
By: /s/ Xxxxx Xxxxxxxx
---------------------------------
Name: Xxxxx Xxxxxxxx
Ttitle: Chief Financial Officer
THIRD POINT OFFSHORE FUND, LTD.
By: /s/ Xxxxx Xxxxxxxx
---------------------
Name: Xxxxx Xxxxxxxx
Title: Chief Financial Officer
POINTS WEST INTERNATIONAL INVESTMENTS
LTD.
By: /s/ Xxxxx Xxxxxxxx
------------------------------------
Name: Xxxxx Xxxxxxxx
Title: Chief Financial Officer
BANZAI OFFSHORE FUND, LTD.
By: /s/ Xxxxx Xxxxxxxx
------------------------------------
Name: Xxxxx Xxxxxxxx
Title: Chief Financial Officer
/s/ Xxxxxxx Xxxxx XxxxxX
------------------------------------
Name: Xxxxxxx Xxxxx Xxxxxx
SELLER:
XXXXXX HOLDINGS, LLC
By: /s/ Xxxxxx X. Xxxxx
------------------------------------
Name: Xxxxxx X. Xxxxx
Title: Vice President
