EXHIBIT 10.10
SETTLEMENT AGREEMENT AND RELEASE
This SETTLEMENT AGREEMENT AND RELEASE ("Agreement") is made and entered
into as of the 30th day of July, 2007, by and between Xxxxxxxxxx Chemicals LLC,
Vertellus Specialties Holdings UK Ltd. (formerly Xxxxxxxxxx Chemicals UK Ltd.),
Vertellus Specialties UK Ltd. (formerly Seal Sands Chemicals Ltd.), and
Vertellus Specialties Holdings Corp. (formerly Xxxxxxxxxx Chemicals Holdings
Corp.) and Cambrex Corporation, Nepera, Inc., CasChem Inc., Zeeland Chemicals,
Inc. (a/k/a Zeeland, Inc.), Nepcam, Inc., and Cambrex Ltd. The signatories to
this Agreement will be referred to jointly as the "Parties."
RECITALS:
WHEREAS, certain of the Parties have been engaged in litigation regarding
the application of the Asset Purchase Agreement (defined below) in New York
State Supreme Court under the caption Xxxxxxxxxx Chemicals LLC et al. v. Cambrex
Corporation, et al., Index No. 601176/06; and
WHEREAS, to avoid the expense, uncertainty, and disruption of further
litigation, the Parties wish to resolve their disputes regarding the Asset
Purchase Agreement and intend this Agreement to effectuate the full, final and
complete resolution of the allegations, claims, and causes of action that have
been asserted in the Litigation, as defined herein; to further settle and
resolve certain additional claims that have not been raised in the Litigation,
including but not limited to all claims for payments of the Subordinated
Promissory Note as defined in the Asset Purchase Agreement and all additional
payments now or in the future that are or might be due and owing under the Asset
Purchase Agreement;
NOW, THEREFORE, in consideration of the covenants set forth in this
Agreement, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Parties hereby agree as
follows:
ARTICLE I
DEFINITIONS
1.1 "Asset Purchase Agreement" or "APA" means the Amended and Restated
Asset Purchase Agreement dated as of October 17, 2003, between Xxxxxxxxxx
Acquisition Corp. and Cambrex Corporation and the Sellers listed therein,
including the document entitled "Documents Executed and Delivered in Connection
with the Acquisition of The Xxxxxxxxxx Chemicals Business by Xxxxxxxxxx
Acquisition Corp." dated November 10, 2003.
1.2 "Assumed Liabilities" means the liabilities and obligations defined in
the APA and set forth on Annex A to the APA.
1.3 "Cambrex" means Defendants Cambrex Corporation, Nepera, Inc., CasChem
Inc., Zeeland, Inc., Nepcam, Inc., and Cambrex Ltd., and all subsidiaries,
successors and assigns.
1.4 "Claims" means any and all claims asserted by Xxxxxxxxxx in the
Complaint, including but not limited to, all claims for money damages,
indemnification, breach of warranty and covenants, attorneys' fees, and all
claims for declaratory and injunctive relief.
1.5 "Closing" means the November 11, 2003 closing at which Xxxxxxxxxx
Acquisition Corp. concluded the purchase from Cambrex of the Xxxxxxxxxx
Facilities, as defined herein.
1.6 "Complaint" means the "Complaint for Indemnification, Breach of
Warranty and Covenants, Declaratory and Injunctive Relief" filed in the Supreme
Court of the State of New York, County of New York, on April 4, 2006.
1.7 "Counterclaims" means any and all Counterclaims asserted by Cambrex in
their Initial Answer and their First and Second Amended Answers and
Counterclaims, including but not limited to, all claims for money damages,
indemnification, damages or offsets for breach of warranty and covenants,
reformation, attorneys' fees, and all claims for declaratory and injunctive
relief.
1.8 "Environmental Escrow Agreement" means the agreement entered into by
the Parties to this Agreement and that is attached hereto and expressly made a
part of this Agreement.
1.9 "Environmental Laws" means all federal, state, local and foreign laws,
orders, and regulations relating to pollution or protection of the environment,
including, without limitation, ambient air, surface water, groundwater, surface
or subsurface strata, sediments, all fish, wildlife, biota and all other natural
resources, worker health, preservation or reclamation of natural resources (the
"Environment"), or to the management handling, use, generation, treatment,
storage, transportation, disposal, manufacture, distribution, formulation,
packaging, labeling, releases or threatened releases of, or exposure to,
Hazardous Materials, including without limitation: the Comprehensive
Environmental Response, Compensation, and Liability Act, 42 U.S.C. Sections 9601
et seq. ("CERCLA"), the Federal Water Pollution Control Act, 33 U.S.C. Sections
1251 et seq.; the Clean Air Act, 42 U.S.C. Sections 7401 et seq.; the Toxic
Substances Control Act, 15 U.S.C. Sections 2601 et seq.; the Occupational Safety
and Health Act, 29 U.S.C. Sections 651 et seq. (but solely as it relates to the
exposure of Hazardous Materials); the Emergency Planning and Community
Right-to-Know Act of 1986, 42 U.S.C. Sections 11001 et seq.; the Safe Drinking
Water Act, 42 U.S.C. Sections 300(f) et seq.; the Hazardous Materials
Transportation Act, 49 U.S.C. Sections 1801 et seq.; the Federal Insecticide,
Fungicide and Rodenticide Act, 7 U.S.C. Sections 136 et seq.; the Resource
Conservation and Recovery Act of 1976 ("RCRA"), 42 U.S.C. Sections 6901 et seq.;
the Oil Pollution Act of 1990, 33 U.S.C. Sections 2701 et seq.; and any similar
or implementing state or local law, and any non-U.S. laws and regulations of
similar import, and all amendments or regulations promulgated thereunder; and
any common law doctrine, including without limitation, negligence, nuisance,
trespass, personal injury or property damage, to the extent such common laws
doctrine relates to or arises out of the presence of, release or threatened
release of, or exposure to, Hazardous Materials.
1.10 "Environmental Liabilities" means any and all costs, losses, damages,
demands, claims, fines, penalties, assessments, expenses, obligations and
liabilities arising in connection with or in any way relating to (a) the
ownership or operation of the Xxxxxxxxxx Facilities or the
2
chemicals business operated thereon or associated therewith; or (b) the
ownership, operation or condition of the real property located at the Xxxxxxxxxx
Facilities, which in either case arise under, are necessary to achieve or
maintain compliance with, or relate to (i) the presence, use, generation,
storage, transportation, treatment, sale, disposal or release or exposure to any
Hazardous Materials at any of the Xxxxxxxxxx Facilities, or (ii) any violation
of or liability or obligation under any Environmental Laws, whether occurring
prior to, on or after the Closing and whether accrued, contingent, absolute,
determined, determinable, disclosed, undisclosed or otherwise.
1.11 "Escrow Account" means the account established, defined in, and
governed by the Environmental Escrow Agreement.
1.12 "Excluded Liabilities" means the liabilities and obligations set forth
in the APA and on Annex C to the APA.
1.13 "Financial Claims" means any right or obligation under the APA for or
related to the payment, receipt, return, or reimbursement of any portion of the
Purchase Price, Working Capital Adjustment, Subordinated Note, Cash/Debt
Adjustment, Prorations of taxes or other funds, Additional Payments, Right to
Setoff, and Taxes of any kind or form. The Capitalized terms used in this
definition of "Financial Claims" shall have the meaning assigned to them in the
APA.
1.14 "Governmental or Regulatory Authority" means any court, tribunal,
arbitrator, authority, agency, commission, official or other instrumentality
exercising governmental or regulatory authority of the United States, any
foreign country or any domestic or foreign state, province, county, city,
municipality or other political subdivision or any quasi-governmental or
regulatory body exercising authority thereunder.
1.15 "Hazardous Materials" means (a) any petroleum or petroleum products,
explosives, radioactive materials, asbestos in any form or condition, urea
formaldehyde foam insulation and transformers or other equipment that contain
dielectric fluid containing regulated levels of polychlorinated biphenyls
(PCBs); and (b) any chemicals, materials, wastes, or substances regulated,
defined as or included in the definition of "hazardous substances," "hazardous
wastes," "extremely hazardous wastes," "restricted hazardous wastes," "toxic
substances," "toxic pollutants," "contaminants," or words of similar import
under any Environmental Laws as defined herein.
1.16 "Litigation" means the lawsuit filed by Xxxxxxxxxx in New York Supreme
Court, Commercial Division, captioned Xxxxxxxxxx Chemicals LLC, Xxxxxxxxxx
Chemicals UK Ltd., and Seal Sands Ltd. v. Cambrex Corporation, Nepera, Inc.,
CasChem Inc., Zeeland, Inc., Nepcam, Inc., and Cambrex Ltd., Index No.
601176/06, and all claims and counterclaims asserted therein.
1.17 "Loss" or "Losses" shall mean any and all losses, injuries, claims,
expenses, damages of any kind, judgments, settlements, debts, penalties, fines,
obligations, interest (including prejudgment interest), costs and expenses
(including court costs and reasonable attorneys' fees and expenses and
reasonable costs of investigation).
3
1.18 "Nepera Facility" means the Xxxxxxxxxx Facility in Xxxxxxxx, New York
as described and defined in the APA. "CasChem Facility" means the Xxxxxxxxxx
Facility in Bayonne, New Jersey; "Heico Facility" means the Xxxxxxxxxx Facility
in Delaware Water Gap, Pennsylvania; "Zeeland Facility" means the Xxxxxxxxxx
Facility in Zeeland, Michigan; and "Seal Sands Facility" means the Xxxxxxxxxx
Facility in Middlesborough, England
1.19 "Off-Site" means any area beyond the boundaries or borders of the Real
Property of the Xxxxxxxxxx Facilities, as that term "Real Property" is defined
in Section 3.12(a) and Schedule 3.12(a) of the APA.
1.20 "Person" means an individual, corporation, partnership, limited
liability company, association, trust or other entity or organization, including
a governmental or political subdivision or a Governmental or Regulatory
Authority.
1.21 "Remediation" means any and all investigation, delineation, cleanup,
containment, removal, capping, remediation, corrective action, monitoring or
other treatment related to the release, threatened release or presence of
Hazardous Materials or any such conduct designed to address any Environmental
Liabilities or to comply with any Environmental Laws, including any permit or
order under any Environmental Law issued by a Governmental or Regulatory
Authority.
1.22 "Remediation Costs" means any and all administrative, legal,
investigative, remedial, corrective and other costs, expenses and fees arising
from or incurred in connection with any Remediation.
1.23 "Xxxxxxxxxx" means Xxxxxxxxxx Chemicals LLC, , Vertellus Specialties
Holdings UK Ltd. (formerly Xxxxxxxxxx Chemicals UK Ltd.), Vertellus Specialties
UK Ltd. (formerly Seal Sands Chemicals Ltd.), and Vertellus Specialties Holdings
Corp. (formerly known as Xxxxxxxxxx Chemicals Holdings Corp.) and all
subsidiaries (except non-wholly owned subsidiaries in China), successors and
assigns.
1.24 "Xxxxxxxxxx Facilities" means the five plants, including the real
property on which the plants are located, acquired by the Xxxxxxxxxx Acquisition
Corp. in the Asset Purchase Agreement defined herein, which include: the Nepera
Facility in Xxxxxxxx, New York; the CasChem facility in Bayonne, New Jersey; the
Heico facility in Delaware Water Gap, Pennsylvania; the Zeeland facility in
Zeeland, Michigan; and the Seal Sands facility in Middlesborough, England.
1.25 "Third Party Claim" means the assertion by any Person (including,
without limitation, any Governmental or Regulatory Authority) who is not a party
to this Agreement of any claim or the commencement by any Person of any action
or proceeding.
1.26 "Wholly-Owned Affiliate" means, with respect to the Initial Nepera
Asset Transferee, any Person that either (i) wholly controls the Initial Nepera
Asset Transferee; (ii) is wholly controlled by the Initial Nepera Asset
Transferee; or (iii) is wholly controlled by another Person that also wholly
controls the Initial Nepera Asset Transferee.
1.27 Any capitalized term in this Agreement that is not specifically
defined in
4
Section 1 of this Agreement or in a parenthetical in this Agreement, shall be
deemed to have the meaning assigned to such capitalized term in the APA.
ARTICLE II
TERMS
2.1 Settlement Payments and Funding of Escrow. The settlement sum shall be
eight million and two hundred and fifty thousand dollars ($8,250,000) (the
"Settlement Sum").
2.1.1 Cambrex Payments and Allocation of Settlement Sum.
(a) Cambrex shall pay Xxxxxxxxxx the sum of six hundred
thirty-five thousand, nine hundred thirty-nine dollars ($635,939.00), which
represents certain Remediation Costs at the Nepera Facility that already have
been incurred by Xxxxxxxxxx as of June 30, 2007 ("Past Nepera Expenses").
Cambrex shall pay this amount directly to Xxxxxxxxxx (not to the Escrow Account)
within thirty (30) days following the date of this Agreement.
(b) The Settlement Sum minus the Past Nepera Expenses is equal to
seven million, six hundred and fourteen thousand, sixty-one dollars ($7,614,061)
and shall be referred to herein as the "Escrow Deposit." The Escrow Deposit
shall be used for the purposes prescribed in the Environmental Escrow Agreement,
which shall include the reimbursement or payment to Xxxxxxxxxx or its designated
representatives for any and all Remediation Costs incurred on or after June 30,
2007, resulting from, relating to, or addressing the following: any and all
Remediation at the Nepera Facility and the Heico Facility; any and all
Remediation of toluene at the Seal Sands Facility; and/or any and all
Remediation of mercury at the Zeeland Facility or any other Hazardous Materials
at any of the seven closed and inactive lagoons at the Zeeland Facility and the
closed Ketone Sludge Pond at the Zeeland Facility formerly used to store a
variety of chemicals between the 1950s and the 1970s; provided, however, that no
more than one million dollars ($1,000,000) of the Escrow Deposit may be used for
the purpose of reimbursing Xxxxxxxxxx for Remediation Costs incurred at sites
other than the Nepera Facility.
(c) Cambrex shall deposit into the Escrow Account the amount of
the Escrow Deposit minus the amount of Xxxxxxxxxx'x Note Payment, as outlined in
Paragraph 2.1.2(b) below (the "Net Escrow Deposit"). Cambrex shall deposit the
Net Escrow Deposit into the Escrow Account within thirty (30) days following
Xxxxxxxxxx'x Final Note Payment, as outlined in Section 2.1.2(b) below.
2.1.2 Xxxxxxxxxx Payments. Xxxxxxxxxx shall make the following
payments:
(a) After the Closing, Xxxxxxxxxx received tax refunds (the "Tax
Refunds") from United Kingdom taxing authorities in the amount of 284,764
British Pounds Sterling for tax year 2002 and 114,938 British Pounds Sterling
for tax year 2003. Xxxxxxxxxx shall pay directly to Cambrex (not to the Escrow
Account) 399,702 British Pounds Sterling within thirty (30) days following the
execution of this Agreement.
(b) Pursuant to the APA, Xxxxxxxxxx provided Cambrex with the
Subordinated Promissory Note in the amount of $2,000,000, bearing interest at
the rate of 12%
5
per annum. As of September 30, 2007, the outstanding principal and interest on
the Subordinated Promissory Note will be three million, one hundred forty-nine
thousand, and one hundred eighty-five dollars ($3,149,185). Xxxxxxxxxx shall pay
to Cambrex $3,149,185, plus interest accrued on any outstanding amounts from
October 1, 2007 until such time as the Note Payments or portions thereof are
paid, at the rate of 12% per annum (the "Note Payment"). The Note Payment shall
be made by Xxxxxxxxxx by depositing into the Escrow Account the following
amounts at the times specified:
(i) Payment 1: one million dollars ($1,000,000) to be
deposited into the Escrow Account on or before September 30,
2007;
(ii) Payment 2: one million dollars ($1,000,000) to be
deposited into the Escrow Account on or before November 30,
2007; and
(iii) Final Note Payment: the balance of the Note Payment
(the "Final Note Payment") to be deposited into the Escrow
Account on or before February 28, 2008. The Final Note
Payment shall be for one million, one hundred forty-nine
thousand, one hundred eighty-five dollars ($1,149,185) plus
interest accrued on the outstanding balances of the Note
Payment between October 1, 2007 and the date of the Final
Note Payment. The interest accrued between the October 1,
2007 and the date of the Final Note Payment shall be at the
rate of 12% per annum and shall be determined based on the
daily balance of the outstanding Note Payment during that
time period.
2.1.3 Notwithstanding the provisions of this Section 2.1, in the event
that (i) Vertellus Specialties Holdings Corp. is sold in a stock sale or (ii)
all or substantially all of the assets of Vertellus Specialties Holdings Corp.
are sold to a buyer not affiliated with Xxxxxxxxxx, the balance of Xxxxxxxxxx'x
Note Payment still due and owing under Section 2.1.2(b) shall be paid into the
Escrow Account within thirty (30) days following the closing date of such sale
of Vertellus Specialty Holdings Corp. or substantially all of its assets.
Cambrex's Net Escrow Deposit shall then be paid into the Escrow Account within
thirty (30) days of Xxxxxxxxxx'x payment of the balance of its Note Payment. In
the event Xxxxxxxxxx otherwise prepays the full remaining balance of the Note
Payment prior to January 28, 2008, Cambrex shall deposit into the Escrow Account
the Net Escrow Deposit within thirty (30) days of receipt of notice from
Xxxxxxxxxx that it has prepaid the Note Payment. In the event Xxxxxxxxxx prepays
the Note Payment prior to September 30, 2007, the total amount of the Note
Payment due and owing under Section 2.1.2(b) shall be reduced by the amount of
12% interest per annum, calculated per day, from the date of the prepayment
through September 30, 2007. In the event Xxxxxxxxxx fails to make the payments
required under Section 2.1.2 of this Agreement, the Parties shall have all of
their rights and remedies under the Subordinated Promissory Note, dated November
10, 2003, and attached to the APA.
2.1.4 All payments and deposits required under Section 2.1 shall be
made by
6
wire transfer.
2.2 Dismissal of Claims and Counterclaims and Waiver of Certain Rights
Under the APA.
2.2.1 The Parties hereby waive and release each other of all Claims
and Counterclaims that have been asserted in the Litigation, with the exception
of Cambrex's specific assertions in Paragraphs 45 and 47 of the Second
Counterclaim of Cambrex's First Amended Answer and Counterclaim ("Second
Counterclaim") that Xxxxxxxxxx has breached Section 7.07 (f)(ii) of the APA,
which claim Cambrex waives and releases but only to the extent set forth in
Section 2.2.2. This waiver and release shall not be deemed to waive or release
any rights or obligations under the APA or otherwise that are specifically
preserved or created in this Agreement.
2.2.2 Upon execution of this Agreement, within ten (10) days:
(a) the Parties shall jointly file a motion seeking dismissal
with prejudice of all Claims and Counterclaims that have been asserted in the
Litigation, with the exception of Cambrex's specific assertions in Paragraphs 45
and 47 of its Second Counterclaim that Xxxxxxxxxx has breached Section
7.07(f)(ii) of the APA, which Cambrex shall dismiss without prejudice; provided
however that Cambrex waives any right to seek the recovery of any damages or
costs that it may have suffered or incurred prior to the date of this Agreement
that did result or might have resulted from any alleged breach or violation of
Section 7.07(f)(ii) of the APA.
(b) Cambrex shall file notice of dismissal with prejudice of its
appeal to the Appellate Division, First Department, of the Supreme Court of the
State of New York concerning the March 27, 2007 Decision and Order of the trial
court in the Litigation; and
(c) the Parties shall jointly file a stipulation and proposed
order to release the bond that Cambrex has posted in connection with the order
preliminarily enjoining Xxxxxxxxxx from demolishing the Nepera Facility.
2.2.3 All Parties hereby waive and extinguish all rights under the APA
or otherwise to seek indemnification, damages, injunctive relief, declaratory
relief, or any other remedy for breach of any warranty, covenant,
representation, Assumed Liability, Excluded Liability, or other obligation
contained in the APA, as they relate to any or all Financial Claims, whether
ripe, accrued, unaccrued, known or unknown at the time of the execution of this
Agreement.
2.2.4 All Parties hereby waive and extinguish all rights under the APA
to seek indemnification, damages, injunctive relief, declaratory relief, or any
other remedy for breach of any warranty, covenant, representation, Assumed
Liability, Excluded Liability or other obligation contained in the APA as they
relate to Environmental Liabilities, including any and all Remediation related
thereto, EXCEPT with respect to the Parties' rights and obligations as set forth
in Subparagraphs 2.3.1(a)(i)-(v) of this Agreement.
7
2.2.5 Xxxxxxxxxx hereby waives any right to seek redress from Cambrex
for future remediation of the toluene plume at Seal Sands even if such
remediation is to occur Off-Site; except that nothing herein shall be construed
to restrict or prohibit Xxxxxxxxxx from utilizing the Escrow Account to pay for
remediation of or associated with the toluene plume at Seal Sands, including
Off-Site, up to the limits provided for in Section 2.1.1(b).
2.2.6 All Claims and Counterclaims dismissed or waived under the terms
of this Agreement are so dismissed or waived by the Parties, which shall include
for these purposes their respective affiliates, parents, subsidiaries, present
and former officers, directors, partners, employees, agents, attorneys,
insurers, administrators, receivers, trustees, conservators, predecessors,
successors and assigns.
2.3 Amendment and Modification of the APA.
2.3.1. The APA is amended and modified as follows:
(a) Any and all rights, obligations and limitations of the
Parties under the APA with respect to Environmental Liabilities and the
Remediation thereof at the Xxxxxxxxxx Facilities, including but not limited to
the covenants made in Sections 6.03, 6.04, 7.08 and 7.11 of the APA and all
rights, obligations and limitations related thereto, and all rights,
obligations, limitations and liabilities related to Environmental Liabilities at
or relating to the Xxxxxxxxxx Facilities that are denoted in the APA as Assumed
Liabilities or Excluded Liabilities, are extinguished and hereby governed by the
terms of this Agreement, INCLUDING AS FOLLOWS:
(i) Cambrex shall be solely responsible for Environmental
Liabilities attributable to or arising from the pre-Closing Off-Site treatment,
storage, transportation, release, threatened release, disposal or arrangement
for disposal of any Hazardous Materials by or on behalf of Cambrex or any of
their respective predecessors or affiliates or otherwise in connection with any
of the Xxxxxxxxxx Facilities; provided, however, that Cambrex shall have no
responsibility for the Remediation of Hazardous Materials on, in, or below the
Real Property even if such Remediation arises from, relates to, or is required
to remedy Off-Site Environmental Liabilities unless such Remediation is
otherwise part of Cambrex's responsibilities or obligations under this
Agreement, including but not limited to the other subparagraphs of this Section
2.3.1(a); provided further, that Cambrex shall have no responsibility for
Remediation or any fines or penalties attributable to or arising from the
Off-Site release or threatened release of toluene from the toluene plume at the
Seal Sands Facility.
(ii) Cambrex shall be solely responsible for (1) any Third
Party Claims for damage or injury suffered as the result of products sold in
connection with the operation of the Xxxxxxxxxx Facilities prior to the Closing;
and (2) any Third Party Claims for any personal injuries, property damage (other
than damage to the real property of the Xxxxxxxxxx Facilities) or natural
resource damages attributable to or arising from any pre-Closing exposure to or
damage from any Hazardous Materials with respect to the Xxxxxxxxxx Facilities.
(iii) Cambrex shall conduct and complete all Remediation
required at the CasChem facility under the New Jersey Industrial Site Recovery
Act, as amended,
8
and the regulations thereunder ("ISRA"), pursuant to and as fully set forth in
Section 7.07 of the APA.
(iv) Cambrex shall conduct and complete all Remediation of
Hazardous Materials in, on, beneath, from, or adjacent to the Nepera Facility
required to be implemented by the New York Department of Environmental
Conservation ("NYSDEC") pursuant to the Record of Decision for Site No. 33606,
dated March 1997 (the "ROD"), pursuant to and as fully set forth in Section 7.07
of the APA.
(v) All rights and obligations set forth in Section 7.07 of
the APA, including those applicable to both Seller and Buyer, shall be fully
applicable and shall be enforceable pursuant to and in accordance with the terms
of this Agreement, but only to the extent such rights and obligations relate to
performance of Remediation at the CasChem Facility under ISRA or Remediation at
the Nepera Facility under the ROD, except that all rights and obligations under
Section 7.07(f)(i) and Section 7.07(g)(iv) are hereby waived and extinguished.
(b) Any disputes regarding or relating to the application of the
APA, including but not limited to any claims for breach, enforcement,
indemnification, interpretation or damages under the APA, shall be submitted,
processed, adjudicated and resolved in accordance with the terms of Section 4.1
below.
2.3.2 To the extent any terms of this Agreement and the APA are deemed
to conflict or to be inconsistent, the terms of this Agreement shall govern and
shall be applied.
2.4 Indemnity.
2.4.1 Cambrex shall, jointly and severally, to the fullest extent
permitted by applicable law, indemnify, defend and hold harmless Xxxxxxxxxx from
and against any Losses resulting from any Environmental Liabilities suffered or
incurred by Xxxxxxxxxx for which Cambrex is responsible under Section
2.3.1(a)(i)-(v). Except with respect to Cambrex's obligations that are
specifically preserved or otherwise set forth in this Agreement, including those
set forth in Section 2.3.1(a)(i)-(v), Xxxxxxxxxx shall, jointly and severally,
to the fullest extent permitted by applicable law, indemnify, defend and hold
harmless Cambrex from and against any Losses resulting from any Environmental
Liabilities suffered or incurred by Cambrex arising out of, resulting from or
relating to (x) the presence of Hazardous Materials at any of the Xxxxxxxxxx
Facilities or (y) Remediation, fines or penalties relating to any Off-Site
release or threatened release of toluene from the toluene plume at the Seal
Sands Facility.
2.4.2 If Cambrex shall receive notice or otherwise learn of a Third
Party Claim with respect to which Xxxxxxxxxx is obligated to provide
indemnification pursuant to Section 2.4.1 including without limitation any Third
Party Claim brought under any Environmental Laws, Cambrex shall give Xxxxxxxxxx
written notice thereof promptly after becoming aware of such Third Party Claim;
provided, however, that the failure of Cambrex to give notice as provided in
this provision shall not relieve Xxxxxxxxxx of its obligations under Section 2.4
except to the extent that Xxxxxxxxxx is prejudiced by such failure to give
notice. Such notice shall describe the Third Party Claim in reasonable detail
and, if ascertainable, shall indicate the amount (estimated if necessary) of the
Loss that has been or may be sustained by Cambrex.
9
2.4.3 Xxxxxxxxxx may elect to defend or seek to settle or compromise,
at Xxxxxxxxxx'x own expense and by Xxxxxxxxxx'x own counsel, any Third Party
Claim. Within thirty (30) days after the receipt of notice from Cambrex in
accordance with Section 2.4.2 (or sooner, if the nature of such Third Party
Claim so requires), Xxxxxxxxxx shall notify Cambrex whether Xxxxxxxxxx will
assume responsibility for defending such Third Party Claim. After notice from
Xxxxxxxxxx to Cambrex of its election to assume the defense of a Third Party
Claim, Xxxxxxxxxx shall not be liable to Cambrex under this Section 2.4 for any
legal or other expenses (except expenses approved in advance by Xxxxxxxxxx )
incurred by Cambrex in connection with the defense thereof; provided that if the
defendants in any such claim include both Xxxxxxxxxx and Cambrex and, in
Cambrex's reasonable judgment, a conflict of interest between Xxxxxxxxxx and
Cambrex exists in respect of such claim, Cambrex shall have the right to employ
separate counsel to represent itself at its own expense. If Xxxxxxxxxx elects
not to assume responsibility for defending a Third Party Claim, or fails to
notify Cambrex of its election as provided in this Section 2.4.3, Cambrex may
defend or (subject to the remainder of this Section 2.4) seek to compromise or
settle such Third Party Claim and seek redress from Xxxxxxxxxx under the terms
of this Agreement.
2.4.4 If Xxxxxxxxxx chooses to defend or to seek to compromise or
settle any Third Party Claim, Cambrex shall make available to Xxxxxxxxxx any
personnel or any books, records or other documents within Cambrex's control or
which it otherwise has the ability to make available that are necessary or
appropriate for such defense, settlement or compromise, and shall otherwise
cooperate in the defense, settlement or compromise of such Third Party Claim.
2.4.5 In the event of payment by Xxxxxxxxxx to Cambrex in connection
with any Third Party Claim that Cambrex is not responsible for under the terms
of this Agreement, Xxxxxxxxxx shall, to the fullest extent permitted by
applicable law, be subrogated to and shall stand in the place of Cambrex as to
any events or circumstances in respect of which Cambrex may have any right or
claim relating to such Third Party Claim against any claimant or plaintiff
asserting such Third Party Claim or against any other Person. Cambrex shall
cooperate with Xxxxxxxxxx in a reasonable manner, and at the cost and expense of
Xxxxxxxxxx, in prosecuting any subrogated right or claim.
2.4.6 Other Procedures for Indemnification. Any claim for
indemnification by Cambrex under Section 2.4 which does not result from a Third
Party Claim shall be asserted by written notice given by Cambrex to Xxxxxxxxxx.
Xxxxxxxxxx shall have a period of twenty (20) days after the receipt of such
notice within which to respond thereto. If Xxxxxxxxxx does not respond within
such twenty (20) day period, Xxxxxxxxxx shall be deemed to have refused to
accept responsibility to make payment. If Xxxxxxxxxx does not respond within
such twenty (20) day period or rejects such claim in whole or in part, Cambrex
shall be free to pursue such remedies as may be available to such party under
this Agreement.
2.4.7 Indemnification Procedures Apply Equally to Xxxxxxxxxx and
Cambrex.
In the event Xxxxxxxxxx receives notice of a Third Party Claim
described or covered in Section 2.3.1 (a)(ii) or receives notice of a claim
relating to Off Site Hazardous Materials described or covered in Section
2.3.1(a)(i), Xxxxxxxxxx and Cambrex shall follow and adhere to the provisions of
Section 2.4.2, 2.4.3, 2.4.4, 2.4.5 and 2.4.6, EXCEPT THAT the rights and
10
obligations set forth for Cambrex in each of these Sections shall apply to
Xxxxxxxxxx and the rights and obligations set forth for Xxxxxxxxxx in each of
these Sections shall apply to Cambrex.
2.4.8 Notice of Remediation Activities at Nepera.
(a) Until the earlier of such time as (i) Cambrex receives a "no
further action" letter or its equivalent from the New York State Department of
Environmental Conservation ("NYSDEC") or such other Governmental or Regulatory
Authority that Cambrex has completed all required Remediation of Hazardous
Materials at the Nepera Facility pursuant to the ROD or (ii) Xxxxxxxxxx receives
a "no further action" letter or its equivalent from a Governmental or Regulatory
Authority that all Remediation at the Nepera Facility required under the RCRA
RFI corrective action process has been completed as required by applicable law,
Cambrex shall have the right to receive copies of material reports, work plans,
agreements or letters submitted by Xxxxxxxxxx to a Governmental or Regulatory
Authority and other material documents that relate to Remediation at the Nepera
Facility at the same time as such reports, plans, agreements or documents are
submitted to the Governmental or Regulatory Authority, and shall receive prior
notice of and attend any meetings (as an observer) with such Governmental or
Regulatory Authorities; provided that the Parties recognize that ultimate
decision-making authority with respect to such Remediation (other than
Remediation pursuant to the ROD) is retained by Xxxxxxxxxx.
(b) Until such time as Cambrex receives a "no further action"
letter or its equivalent from NYSDEC or such other Governmental or Regulatory
Authority that Cambrex has completed all required Remediation of Hazardous
Materials at the Nepera Facility pursuant to the ROD, Xxxxxxxxxx shall have the
right to receive copies of any material reports, work plans, agreements or
letters submitted by Cambrex to a Governmental or Regulatory Authority, and
other material documents that relate to Remediation under the ROD at the Nepera
Facility at the same time as such reports, plans, agreements or documents are
submitted to the Governmental or Regulatory Authority, and shall receive prior
notice of and attend any meetings (as an observer) with such Governmental or
Regulatory Authorities; provided that the Parties recognize that ultimate
decision-making authority with respect to such Remediation under the ROD is
retained by Cambrex.
(c) Xxxxxxxxxx shall not, without first providing reasonable
prior notice to, and obtaining the express written consent of, Cambrex,
communicate with the NYSDEC or any other Governmental or Regulatory Authority or
any third Person regarding Remediation of Hazardous Materials at the Nepera
Facility pursuant to the ROD, and Xxxxxxxxxx shall facilitate the participation
of Cambrex in all such communications. Cambrex shall not, without first
providing reasonable prior notice to, and obtaining the express written consent
of, Xxxxxxxxxx, communicate with the NYSDEC or any other Governmental or
Regulatory Authority or any third Person regarding Remediation of Hazardous
Materials at the Nepera Facility pursuant to the RCRA RFI corrective action
process or Remediation that is otherwise not Cambrex's responsibility under
Section 2.3.1(a)(iv) hereof, and Cambrex shall facilitate the participation of
Xxxxxxxxxx in all such communications.
11
2.4.9 Notice of Remediation Activities at CasChem.
(a) Until such time as Cambrex receives a "no further action"
letter or its equivalent from the New Jersey Department of Environmental
Protection ("NJDEP") or any other Governmental or Regulatory Authority with
jurisdiction over the CasChem Facility that Cambrex has completed all required
Remediation of Hazardous Materials at the CasChem Facility pursuant to ISRA,
Cambrex shall have the right to receive copies of material reports, work plans,
agreements submitted by Xxxxxxxxxx to a Governmental or Regulatory Authority,
and other material documents that relate to Remediation at the CasChem Facility
at the same time as such reports, plans, agreements or documents are submitted
to the Governmental or Regulatory Authority, and shall receive prior notice of
and attend any meetings (as an observer) with such Governmental or Regulatory
Authorities; provided that the Parties recognize that ultimate decision-making
authority with respect to such Remediation (other than Remediation pursuant to
ISRA) is retained by Xxxxxxxxxx.
(b) Until such time as Cambrex receives a "no further action"
letter or its equivalent from the NJDEP or any other Governmental or Regulatory
Authority with jurisdiction over the CasChem Facility that Cambrex has completed
all required Remediation of Hazardous Materials at the CasChem Facility pursuant
to ISRA, Xxxxxxxxxx shall have the right to receive copies of any material
reports, work plans, agreements submitted by Cambrex to a Governmental or
Regulatory Authority, and other material documents that relate to Remediation at
the CasChem Facility at the same time as such reports, plans, agreements or
documents are submitted to the Governmental or Regulatory Authority, and shall
receive prior notice of and attend any meetings (as an observer) with such
Governmental or Regulatory Authorities; provided that the Parties recognize that
ultimate decision-making authority with respect to such Remediation pursuant to
ISRA is retained by Cambrex.
(c) Xxxxxxxxxx shall not, without first providing reasonable
prior notice to, and obtaining the express written consent of, Cambrex,
communicate with the NJDEP or any other Governmental or Regulatory Authority or
any third Person regarding Remediation of Hazardous Materials at the CasChem
Facility pursuant to ISRA, and Xxxxxxxxxx shall facilitate the participation of
Cambrex in all such communications. Cambrex shall not, without first providing
reasonable prior notice to, and obtaining the express written consent of,
Xxxxxxxxxx, communicate with the NJDEP or any other Governmental or Regulatory
Authority or any third Person regarding Remediation of Hazardous Materials at
the CasChem Facility that is not Cambrex's responsibility under Section
2.3.1(a)(iii) hereof, and Cambrex shall facilitate the participation of
Xxxxxxxxxx in all such communications.
2.4.9 Remedies Cumulative. The remedies provided in this Section 2.4
shall be cumulative and shall not preclude the assertion by any Party of any
other rights or the request for any and all other remedies, to the extent
permitted by this Agreement.
2.5 Sale and Assignability.
2.5.1 This Agreement shall be binding upon the Parties hereto, their
successors, subsidiaries (except non-wholly owned subsidiaries in China),
assigns, agents, directors, officers and employees, provided that no Party may
assign, delegate or otherwise transfer any of its rights
12
or obligations under this Agreement or the APA without the consent of the other
Parties hereto. Notwithstanding the foregoing, Xxxxxxxxxx may transfer or assign
in whole or in part its rights and obligations under this Agreement to: (i) one
or more of its subsidiaries or affiliates; (ii) any financial institution
providing purchase money or other financing to Xxxxxxxxxx or to one or more of
its subsidiaries or affiliates; (iii) a purchaser of all or a substantial
portion of the assets of the Xxxxxxxxxx Chemicals Business; or (iv) a purchaser
of all or a substantial portion of the assets of Nepera, but no such transfer or
assignment shall relieve Xxxxxxxxxx of any of its obligations hereunder. In the
case of a sale of all or a substantial portion of the assets of the Xxxxxxxxxx
Chemicals Business, the transferee shall assume the related obligations of
Xxxxxxxxxx hereunder and, in the case of the sale of all or a substantial
portion of the assets of Nepera, only the Person that purchases all or a
substantial portion of the assets of the Nepera Facility directly from
Xxxxxxxxxx (the "Initial Nepera Asset Transferee") shall assume the related
obligations of Xxxxxxxxxx hereunder as they apply to the Nepera Facility. The
Initial Nepera Asset Transferee shall have no obligation to bind future
transferees to the terms of this Agreement; provided, however, that in the event
the Initial Nepera Asset Transferee sells or transfers all or a substantial
portion of the assets of Nepera to a Wholly-Owned Affiliate, such Wholly-Owned
Affiliate shall assume the related obligations of Xxxxxxxxxx hereunder as they
apply to the Nepera Facility. Such obligations shall survive until the earlier
of: (i) thirty (30) months after the Initial Nepera Asset Transfer directly from
Xxxxxxxxxx; or (ii) when all remedial construction required as part of the RCRA
RFI corrective action process is complete or the Nepera Facility receives a
"Completion Notice" from the jurisdictional Governmental or Regulatory
Authorities (such as a "no further action" letter or its equivalent or
acceptance by such Governmental or Regulatory Authority of Xxxxxxxxxx'x final
notice of completion). For purposes of this Section 2.5.1, the Initial Nepera
Asset Transferee shall not include any entity that is an Affiliate of
Xxxxxxxxxx. Xxxxxxxxxx hereby represents that it will maintain sufficient assets
to fulfill its obligations under this Agreement in the event of a sale of assets
of the Xxxxxxxxxx Chemicals Business that are material to the overall financial
condition of Xxxxxxxxxx or the sale of a Xxxxxxxxxx Facility by Xxxxxxxxxx.
2.5.2 If Xxxxxxxxxx enters into any agreement to sell all or a
substantial portion of a Xxxxxxxxxx Facility, Xxxxxxxxxx shall provide Cambrex
with notice of such transaction within 48 hours of closing and shall disclose
all material terms relating to any assumption by the transferee of any of
Xxxxxxxxxx'x obligations under this Settlement Agreement.
ARTICLE III
INTERPRETATIVE MATTERS
3.1 Interpretation of Agreement.
3.1.1 The Agreement will be interpreted and enforced under the laws of
the State of New York, without regard to principles of choice of law.
3.1.2 The Parties agree that this Agreement and the negotiations
relating thereto do not constitute an admission or evidence of any wrongdoing,
misconduct or violation of any law whatsoever by either Party and further agree
that neither this Agreement nor the negotiations thereto shall be admissible in
evidence in any proceeding except to enforce its terms.
13
3.1.3 This Agreement, together with the documents specifically
referenced herein, set forth the entire agreement and understanding among the
Parties with respect to the transaction, agreements and understandings relating
to the subject matter hereof. No representations, promises or inducements have
been made by the Parties which are not embodied in this Agreement, together with
the documents specifically referenced herein, and none of the Parties hereto
shall be bound by or liable for the alleged representation, promise, inducement
or statement of intent not so set forth.
3.1.4 This Agreement may not be altered, amended, abandoned, modified,
waived, superseded, canceled or discharged, except by a further writing
subscribed to by all Parties.
3.1.5 This Agreement may be executed in counterparts, all of which
counterparts shall constitute one agreement, and the Parties agree that a
facsimile signature shall be binding.
3.1.6 All notices, requests, claims, demands and other communications
to any party hereunder must be in writing and must be given by hand delivery, by
courier service or by facsimile to the applicable party at the following
address:
if to Cambrex, to:
Cambrex Corporation
Xxx Xxxxxxxxxxx Xxxxx
Xxxx Xxxxxxxxxx, Xxx Xxxxxx 00000
Attention: General Counsel
with a copy to:
Milbank, Tweed, Xxxxxx & XxXxxx LLP
Xxx Xxxxx Xxxxxxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx X. Arena, Esq.
if to Xxxxxxxxxx, to:
Vertellus Specialties Inc.
000 Xxxxx Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxxxxxxx, Xxxxxxx 00000
Attention: General Counsel
with a copy to:
Akin Gump Xxxxxxx Xxxxx & Xxxx LLP
0000 Xxx Xxxxxxxxx Xxxxxx, XX
Xxxxxxxxxx, XX 00000
Attention: Xxxxx X. Xxxxx, Esq.
14
ARTICLE IV
ENFORCEMENT OF THIS AGREEMENT AND THE APA
4.1 Enforcement of this Agreement and the APA.
4.1.1 Any claim arising out of or relating to this Agreement, or the
subject matter thereof, including any claim for breach, enforcement,
indemnification or damages under this Agreement, and any future claims arising
out of, relating to, or regarding breach, enforcement, indemnification or
damages under the APA, as amended and modified herein, will be resolved solely
and exclusively through dispute resolution conducted in accordance with the
procedures and rules of the International Institute of Conflict Prevention and
Resolution ("CPR") Rules for Non-Administered Arbitration then in effect; except
that pursuant to Section 13.2 of the CPR Rules for Non-Administered Arbitration,
a Party may seek interim measures and/or provisional relief from a court in
order to protect its rights under this Agreement or the APA. The process for
dispute resolution is prescribed as follows, to the extent such procedures
differ from those set forth in the CPR Rules for Non-Administered Arbitration:
(a) If, in the opinion of one of the Parties, there is a dispute
between Xxxxxxxxxx and Cambrex with respect to the interpretation or
implementation of this Agreement, the opining Party shall send a written Notice
of Dispute to the other party which outlines the nature of the dispute and
requests informal negotiations to resolve the dispute. Such period of informal
negotiations shall not extend beyond twenty (20) days from the date when the
Notice of Dispute was received unless the period is extended by written
agreement of the Parties. After initiation of the informal negotiation period,
any Party to the dispute may, upon seven (7) days' prior written notice to the
other Party, terminate the informal negotiations.
(b) If informal negotiations are unsuccessful or are terminated
in accordance with Subparagraph (a), a Party may initiate arbitration by
sending, via certified mail, a written notice of the claim to the other Party
that (i) identifies and describes the nature of each claim asserted, (ii) the
facts upon which each claim is based, and (iii) the relief or remedy sought. The
Party initiating arbitration shall notify CPR that a demand for arbitration has
been made and the Parties shall endeavor to agree on the appointment of a single
arbitrator. If the Parties have not agreed on a mutually satisfactory arbitrator
within fifteen (15) days of the written notice of the claim, the CPR shall
forthwith appoint an arbitrator pursuant to CPR Rule 5.4.
(c) Within thirty (30) days of receiving a written notice of
claim for arbitration, the responding Party may file an answering statement
setting forth a response to the claim and the issues presented. The filing of
the answering statement shall in no way limit the responding Party's right to
assert other defenses or to assert timely counterclaims or take other positions
that may become apparent during the course of the arbitration.
(d) The arbitrator will promptly set a hearing date and time,
taking into account the Parties' need to take discovery reasonably necessary for
the prosecution or defense of any claim, and will mail written notice of the
hearing date to each of the Parties at least sixty (60) days in advance, unless
the Parties otherwise agree or mutually waive notice.
15
(e) The arbitration shall be held in New York City and the laws
of the State of New York shall apply, without resort to choice of law
principles.
(f) The arbitrator is empowered to subpoena witnesses and compel
the production of documents to the extent permitted in a judicial proceeding,
upon his or her own initiative or the request of one of the Parties. The
arbitrator may grant injunctions or other relief in such dispute, but may not
award punitive or exemplary damages, unless such limitation is prohibited by
law.
(g) No later than fifteen (15) days before the arbitration, the
Parties will exchange lists of witnesses, including any experts, and copies of
all exhibits intended to be used at the arbitration. Each party shall have the
right to subpoena witnesses and documents for the arbitration, as well as
documents relevant to the case from third parties.
(h) The arbitrator shall have the authority to entertain a motion
to dismiss or a motion for summary judgment by any Party and shall apply the
standards governing such motions under the New York CPLR.
(i) The award of the arbitrator shall be FINAL AND BINDING on the
Parties and may be enforced by any court of competent jurisdiction and may be
executed against the person and assets of the losing Party in any jurisdiction.
4.1.2 No claim for damages may be made for breach of this Agreement or
for breach of any surviving portion of the APA unless the value of such claim
exceeds $75,000. The arbitrator shall immediately dismiss any claim submitted
for arbitration where the complaining party can not establish that the value of
its claim will exceed $75,000; provided, however, that this provision shall not
apply to a claim or a motion by a Party for interim measures, provisional relief
or injunctive relief as permitted under this Agreement.
IN WITNESS WHEREOF, the Parties to this Agreement have caused this
Agreement to be duly executed by their respective authorized officers as of the
day and year first written above.
XXXXXXXXXX CHEMICALS LLC,
VERTELLUS SPECIALTIES HOLDINGS CORP.
By: /s/
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
VERTELLUS SPECIALTIES UK LTD., AND
VERTELLUS SPECIALTIES HOLDINGS UK LTD.
By: /s/
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
16
CAMBREX CORPORATION
By: /s/
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
NEPERA, INC., CASCHEM, INC.,
ZEELAND CHEMICALS, INC., NEPCAM, INC.
By: /s/
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
CAMBREX LIMITED
By: /s/
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
17
ENVIRONMENTAL ESCROW AGREEMENT
This ENVIRONMENTAL ESCROW AGREEMENT ("Environmental Escrow Agreement") is
made and entered into as of July 30, 2007, by and between Xxxxxxxxxx Chemicals
LLC, Vertellus Specialties Holdings UK Ltd. (formerly Xxxxxxxxxx Chemicals UK
Ltd.), Vertellus Specialties UK Ltd. (formerly Seal Sands Chemicals Ltd.), and
Vertellus Specialties Holdings Corp. (formerly Xxxxxxxxxx Chemicals Holdings
Corp.) (collectively referred to herein as "Xxxxxxxxxx"), and Cambrex
Corporation, Nepera, Inc., CasChem Inc., Zeeland Chemicals, Inc. (a/k/a Zeeland,
Inc.), Nepcam, Inc., and Cambrex Ltd. (collectively referred to herein as
"Cambrex"), as each of these parties is defined in the Settlement Agreement, and
the Xxxxx Fargo Bank, National Association, as escrow agent (the "Escrow
Agent").
RECITALS:
X. Xxxxxxxxxx and Cambrex are among the parties to a settlement agreement,
dated as of July 30, 2007 (the "Settlement Agreement"), pursuant to which the
Parties have agreed to settle all Claims and Counterclaims in the Litigation as
defined in the Settlement Agreement.
B. Pursuant to the terms of the Settlement Agreement, Cambrex and
Xxxxxxxxxx have agreed to deposit into Escrow seven million, six hundred
fourteen thousand and sixty-one dollars ($7,614,061) to be used to reimburse
Xxxxxxxxxx for Qualified Expenses (as defined below) incurred by Xxxxxxxxxx in
connection with Xxxxxxxxxx'x performance of certain Remediation to be undertaken
at certain of the Xxxxxxxxxx Facilities, as set forth more fully below.
C. Upon Termination of the Environmental Escrow Agreement as defined
herein, the Escrow Funds held by the Escrow Agent in the Escrow Account, if any,
will be disbursed to Xxxxxxxxxx pursuant to the terms of this Agreement.
AGREEMENTS:
NOW, THEREFORE, in consideration of the covenants set forth in this
Environmental Escrow Agreement, and for other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, Xxxxxxxxxx,
Cambrex and the Escrow Agent hereby agree as follows:
ARTICLE I
ESCROW
1.1 Defined Terms. Capitalized terms used in this Environmental Escrow
Agreement but not defined herein shall have the meaning ascribed to them in the
Settlement Agreement.
(a) The term "Settlement Agreement" as used herein, means the
Settlement Agreement and Release executed by the same parties in conjunction
with this Environmental Escrow Agreement and to which this Environmental Escrow
Agreement has been made an Exhibit. The Settlement Agreement is attached hereto
as Exhibit A.
(b) The term "Remediation" shall have the meaning ascribed to it in
the Settlement Agreement. The term "Remediation Work" shall mean any work
performed to
18
investigate, conduct, manage, carry out or complete Remediation.
(c) The term "Permitted Investments" means:
i. direct obligations of, or obligations the principal of and
interest on which are unconditionally guaranteed by, the United States of
America (or by any agency thereof to the extent such obligations are backed by
the full faith and credit of the United States of America) and rated at least
investment grade, in each case maturing within one year from the date of
acquisition thereof;
ii. investments in commercial paper maturing within 180 days from
the date of acquisition thereof and rated, at such date of acquisition, A-1 or
better by Standard & Poor's Ratings Services or P-1 or better by Xxxxx'x
Investors Service, Inc.; or
iii. investments in certificates of deposit, banker's acceptances
and time deposits maturing within 180 days from the date of acquisition thereof
issued or guaranteed by or placed with, and money market deposit accounts issued
or offered by, any domestic office of any commercial bank organized under the
laws of the United States of America or any State thereof which has a combined
capital and surplus and undivided profits of not less than $250,000,000.
1.2 Appointment of the Escrow Agent. Cambrex and Xxxxxxxxxx hereby appoint
Xxxxx Fargo Bank, National Association, as the Escrow Agent, and the Escrow
Agent hereby agrees to assume and perform the duties of the Escrow Agent under
and pursuant to this Agreement.
1.3 Deposit of Escrow Amount.
1.3.1 Xxxxxxxxxx shall deliver to the Escrow Agent the amount equal to
Xxxxxxxxxx'x Note Payment pursuant to Section 2.1.2(b) of the Settlement
Agreement, or in the event of a sale of Vertellus Specialties Holding Corp.,
Xxxxxxxxxx'x deposit shall be made pursuant to Section 2.1.3 of the Settlement
Agreement. Upon delivery of the full amount of the Note Payment to the Escrow
Agent, and pursuant to Section 2.1.1(b) of the Settlement Agreement, Cambrex
shall deliver to the Escrow Agent the amount of the Escrow Deposit minus the
amount of Xxxxxxxxxx'x Note Payment ("Net Escrow Deposit"). Both the Net Escrow
Deposit and the Note Payment shall be delivered to the Escrow Agent in
accordance with the schedule of payments set forth in Section 2.1 of the
Settlement Agreement. All such deposits (collectively referred to herein as the
"Environmental Deposit") shall be made via wire transfer of immediately
available funds to the following account maintained by the Escrow Agent:
Bank: Xxxxx Fargo Bank, National Association
Location: Indianapolis, Indiana
Account Number: TBD
ABA Number: 000-000-000
Reference: Xxxxxxxxxx Vertellus Environmental Escrow
Attention: Xxxx X. Xxxxxxxxx
1.3.2 The Escrow Agent shall invest the Environmental Deposit in an
interest-
19
bearing account ("Escrow Account") by no later than the close of business on the
business day next following the day on which the Environmental Deposit is
received. In the absence of other written investment instructions, the
Environmental Deposit shall be invested in a Xxxxx Fargo Bank Money Market
Deposit Account (the "MMDA"). The Parties understand that amounts on deposit in
the MMDA are insured, subject to the applicable rules and regulations of the
Federal Deposit Insurance Corporation (FDIC), in the basic FDIC insurance amount
of $100,000 per depositor, per insured bank. This includes principal and accrued
interest up to a total of $100,000. The Parties understand that deposits in the
MMDA are not secured. All reasonable administrative costs, fees and expenses of
the Escrow Agent related to such account (collectively, "Fees") may be deducted
by the Escrow Agent from the Escrow Account.
1.3.3 All Permitted Investments shall be considered part of the Escrow
Account. In determining whether and how much of the Escrow Account to deposit or
hold in Permitted Investments, the Escrow Agent shall ensure that there are
sufficient funds available to pay Qualified Expenses within the time periods set
forth in 1.4.5 of this Escrow Agreement.
1.4 Distribution of the Escrow Account.
1.4.1 Qualified Expenses. For purposes of this Environmental Escrow
Agreement, "Qualified Expenses" means costs incurred on or after July 1, 2007 by
Xxxxxxxxxx or any of its successors, assigns, contractors, agents, employees or
representatives relating to or in connection with Remediation at the five
Xxxxxxxxxx Facilities as follows: any and all Remediation at the Nepera facility
and the Heico Facility; any or all Remediation of toluene at the Seal Sands
Facility; and/or any and all Remediation of mercury at the Zeeland Facility or
any Hazardous Materials at any of the seven closed and inactive lagoons at the
Zeeland Facility and the closed Ketone Sludge Pond at the Zeeland Facility
formerly used to store a variety of chemicals between the 1950s and the 1970s.
Qualified Expenses shall include, without limitation, all costs and expenses
related to the management of the work by Xxxxxxxxxx, attorneys' fees for legal
services rendered in connection with Remediation as described herein, and costs
and expenses related to community relations and outreach to the community to the
extent such costs and expenses relate to Remediation as described herein;
provided that any such Remediation Work has been performed in accordance with
the standards set forth in Section 1.4.3 of this Environmental Escrow Agreement;
provided further that not more than one million dollars ($1,000,000) may be used
for the purpose of paying Xxxxxxxxxx or its designated Representatives for
Qualified Expenses relating to Remediation at the Zeeland, Seal Sands or Heico
Facilities combined and provided further that any costs incurred by Xxxxxxxxxx
with respect to the Remediation Work shall not be considered "Qualified
Expenses" for the purposes of this Environmental Escrow Agreement if such costs
relate to actions taken following the issuance of a "no further action" letter,
certificate of completion, or equivalent notice from a Governmental or
Regulatory Authority issued on or after the date of the execution of this
Agreement, reflecting that the respective Remediation Work to which the incurred
costs related has been completed.
1.4.2 Cessation or Modification of Remediation Work. Xxxxxxxxxx shall
deliver to Cambrex and the Escrow Agent (a) any order of, or agreement with, any
Governmental or Regulatory Authority in respect of which Xxxxxxxxxx might make a
claim for a distribution hereunder, as well as any modifications or amendments
of or supplements to existing
20
orders or agreements, as promptly as practicable following the issuance or
execution thereof and (b) any "no further action" letter, certificate of
completion or equivalent document issued with respect to any aspect of, or all,
the Remediation Work as promptly as practicable following the issuance thereof.
1.4.3 Remediation Work Standards. In order for an expense to be deemed
a Qualified Expense, such expense shall be incurred in connection with
Remediation Work which (a) is conducted in accordance with applicable
Environmental Laws and (b) unless required by a Governmental or Regulatory
Authority, is (i) technically feasible and practicable and (ii) based on
customary and accepted engineering practices.
1.4.4 Claims by Xxxxxxxxxx. From time to time during the term of this
Environmental Escrow Agreement, Xxxxxxxxxx or any of its successors, assigns,
contractors, agents, employees or representatives (collectively
"Representatives") authorized by Xxxxxxxxxx to act on its behalf may submit to
the Escrow Agent, with copy to Cambrex, a certificate substantially in the form
of Exhibit B (a "Certificate of Instruction"), setting forth the amount of
expenses incurred by Xxxxxxxxxx or its Representatives (the "Owed Amount") which
Xxxxxxxxxx or its Representatives believes to be Qualified Expenses. Each such
Certificate of Instruction shall describe such expenses in reasonable detail and
be accompanied by receipts, invoices and other appropriate and customary
documentation sufficient to demonstrate the amount of such expenses and to
support Xxxxxxxxxx'x claim that such expenses are Qualified Expenses.
1.4.5 Objections and Payment. Cambrex shall have fifteen (15) calendar
days from the date it receives the Certificate of Instruction to provide the
Escrow Agent and Xxxxxxxxxx with written notice objecting to such Certificate or
any portion thereof ("Objection Period"). If the Escrow Agent has not received
from Cambrex a certificate in substantially the form of Exhibit C attached
hereto (an "Objection Certificate") within the Objection Period, the Escrow
Agent shall deliver to Xxxxxxxxxx within seven (7) calendar days following the
expiration of the Objection Period the portion of the Escrow Account equal to
the dollar amount of the Qualified Expenses set forth in the Certificate of
Instruction, up to an aggregate amount equal to the Escrow Account (less any
fees). If the Escrow Agent and Xxxxxxxxxx each receive an Objection Certificate
from Cambrex objecting to the Certificate of Instruction or any portion thereof,
the Escrow Agent shall (i) deliver to Xxxxxxxxxx within such seven calendar day
period the amount of Qualified Expenses that is not in dispute and (ii) retain
the amount disputed pending resolution of the dispute as follows:
(a) Xxxxxxxxxx and Cambrex shall use their commercially
reasonable efforts to resolve Cambrex's objection by mutual agreement, in which
case Xxxxxxxxxx and Cambrex shall provide the Escrow Agent with a certificate
substantially in the form of Exhibit D attached hereto (a "Resolution
Certificate") stating that Xxxxxxxxxx and Cambrex have agreed that the Owed
Amount referred to in such Certificate of Instruction (or a specified portion
thereof) is payable to Xxxxxxxxxx, so long as sufficient funds are on deposit in
the Escrow Account to make such payment.
(b) If Xxxxxxxxxx and Cambrex cannot mutually resolve Cambrex's
objection within thirty (30) days after the expiration of the Objection Period,
then Cambrex shall submit the dispute to the Special Master, who shall make a
determination within thirty (30) days
21
as to whether the Owed Amount, or any portion thereof, constitutes a Qualified
Expense. The Special Master shall base any such determination on whether the
expenses constituting the Owed Amount are costs relating to or associated with a
Qualified Expense as defined in Section 1.4.1 of this Agreement. The decision of
the Special Master shall be final and binding upon the Parties.
(c) In the event Cambrex submits or makes any objection under any
provision of this Environmental Escrow Agreement or other challenge to
Xxxxxxxxxx'x submission for payment from the Escrow Account or request for
Termination of the Environmental Escrow Agreement under Paragraph 1.6 of this
Agreement, and that objection or challenge is resolved by the Special Master in
Xxxxxxxxxx'x favor in whole or in part, Cambrex shall pay to Xxxxxxxxxx, within
ten (10) days after resolution of the matter by the Special Master: (i) all fees
and costs incurred by Xxxxxxxxxx in responding to and addressing that part of
Cambrex's objection or challenge that was resolved in Xxxxxxxxxx'x favor,
including but not limited to all consultant's and attorneys' fees and the
reasonable hourly fee for employee time used to address such objection or
challenge; and (ii) all fees and costs of the Special Master associated with
addressing and adjudicating that part of Cambrex's objection or challenge that
was resolved in Xxxxxxxxxx'x favor. Failure of Cambrex to make a payment of fees
and costs required under this paragraph shall forfeit and extinguish Cambrex's
right to make future objections or challenges to Xxxxxxxxxx'x submission of any
claim for reimbursement from the Escrow Account.
(d) In the event that Cambrex submits or makes any objection
under any provision of this Environmental Escrow Agreement or other challenge to
Xxxxxxxxxx'x submission for payment from the Escrow Account or request for
Termination of the Environmental Escrow Agreement under Paragraph 1.6 of this
Agreement, and that objection or challenge is resolved by the Special Master in
Cambrex's favor in whole or in part, Xxxxxxxxxx shall pay Cambrex, within ten
(10) days after resolution of the matter by the Special Master: (i) all fees and
costs incurred by Cambrex in submitting that part of Cambrex's objection that
was resolved in Cambrex's favor by the Special Master, including but not limited
to all consultant's and attorneys' fees and the reasonable hourly fee for
employee time used to address such objection or challenge; and (ii) all fees and
costs of the Special Master associated with addressing and adjudicating that
part of Cambrex's objection or challenge that was resolved in Cambrex's favor.
1.5 Certifications. All Certificates to be delivered under this Article I
shall be delivered simultaneously to the Escrow Agent and the other party to
this Environmental Escrow Agreement.
1.6 Termination. This Environmental Escrow Agreement shall terminate upon
the earlier of (a) the distribution of all of the Escrow Account in accordance
with the terms hereof, (b) the date that is ten years from the date of the
execution of this Agreement or (c) such earlier date on which the Escrow Agent
receives a written assurance of concurrence (a "Completion Notice") by the
jurisdictional Governmental or Regulatory Authorities (such as a "no further
action" letter or its equivalent or acceptance by such Governmental or
Regulatory Authority of Xxxxxxxxxx'x final notice of completion) that
Remediation at the Nepera Facility required under the RCRA RFI corrective action
process has been completed as required by applicable law or, in
22
the event monitoring or maintenance of the Nepera Facility is required after
completion of any Remediation, such monitoring and/or maintenance (exclusive of
any pump-and-treat remedy involving groundwater) having been conducted for a
period of at least two years without the imposition of additional remediation
requirements, provided, however, that a Completion Notice will not terminate the
Environmental Escrow Agreement if within twenty (20) days following Cambrex's
receipt of a copy of the Completion Notice, Cambrex provides written notice to
the Escrow Agent, with a copy to Xxxxxxxxxx, of its objection to the Completion
Notice under Section 1.4.2 hereof (the "Completion Objection"); and provided
further that subsequent to the Escrow Agent's receipt of a Completion Objection,
this Environmental Escrow Agreement shall terminate if the Escrow Agent receives
either (x) a joint notice from Xxxxxxxxxx and Cambrex stating that Xxxxxxxxxx
and Cambrex have agreed that this Environmental Escrow Agreement shall be
terminated, or (y) a copy of a final, non-appealable judgment of an arbitrator
stating that the Completion Notice satisfies the requirements of Section 1.4.2
hereof. In the event that this Environmental Escrow Agreement terminates
pursuant to Subsection (b) or (c) of this Section 1.6, the Escrow Agent shall
deliver the amount of the Escrow Account then remaining (less any Fees) to
Xxxxxxxxxx. In any event, upon termination of this Environmental Escrow
Agreement, any remaining balance in the Escrow Account shall be paid to
Xxxxxxxxxx.
ARTICLE II
CONCERNING THE ESCROW AGENT AND THE SPECIAL MASTER
2.1 Concerning the Escrow Agent.
2.1.1 General. Cambrex and Xxxxxxxxxx acknowledge and agree that the
Escrow Agent (a) shall not be responsible for any of the other agreements
referred to herein but shall be obligated only for the performance of such
duties of the Escrow Agent as are specifically set forth in this Environmental
Escrow Agreement, (b) shall not be obligated to take any legal or other action
hereunder which might in its judgment involve expense or liability unless it
shall have been furnished with indemnity acceptable to it, (c) may rely on and
shall be protected in acting or refraining from acting upon any written notice,
instruction, instrument, statement, request or document furnished to it
hereunder and believed by it to be genuine and to have been signed or presented
by the proper person, and shall have no responsibility for determining the
accuracy thereof, and (d) may, at its sole expense, consult counsel satisfactory
to it and the advice or opinion of such counsel shall be full and complete
authorization and protection in respect of any action taken, suffered or omitted
by it hereunder in good faith and in accordance with the advice or opinion of
such counsel.
2.1.2 Expenses of Escrow. The Escrow Agent shall be entitled to
compensation for out-of-pocket expenses incurred in performing the duties and
obligations imposed under this Environmental Escrow Agreement and an annual fee
in the amount of two-thousand and five hundred dollars ($2,500) for the term of
this Environmental Escrow Agreement. All expenses incurred, and fees paid, shall
be paid from the Environmental Deposit. The Escrow Agent shall not be entitled
to any other fee or compensation.
2.1.3 Waiver of Liens. Without prejudice to Section 1.6, 2.1.2, and
any other provision of this Environmental Escrow Agreement specifically
providing for the payment of amounts due to the Escrow Agent hereunder, the
Escrow Agent hereby waives and agrees not to
23
assert any right of setoff or bank, statutory, equitable or other lien in
respect of the Escrow Account or the distribution thereof.
2.1.4 Liability of the Escrow Agent. Upon disbursement of all of the
Escrow Account in accordance with the terms hereof, the Escrow Agent shall be
fully and finally released and discharged from any and all duties, obligations
and liabilities hereunder. In the event of a dispute between any of the parties
hereto as to their respective rights and interests hereunder, the Escrow Agent
shall be entitled to hold the Escrow Account then in its possession hereunder
until such dispute shall have been resolved by the parties in dispute and the
Escrow Agent has been notified by instrument jointly signed by all of the
parties in dispute, or until such dispute shall have been finally adjudicated as
provided in Section 3.9. In the event of a dispute, the Escrow Agent may file an
interpleader action and pay the Escrow Account into the registry of the court.
Neither the Escrow Agent nor any of its directors, officers or employees shall
be liable to anyone for any action taken or omitted to be taken by it or any of
its directors, officers or employees hereunder except in the case of any loss,
liability or expense primarily caused by the Escrow Agent's gross negligence,
bad faith or willful misconduct. Cambrex and Xxxxxxxxxx shall, jointly and
severally, indemnify the Escrow Agent and hold it harmless without limitation
from and against any loss, liability or expense of any nature incurred by the
Escrow Agent arising out of or in connection with this Environmental Escrow
Agreement or with the administration of its duties hereunder, including, legal
fees and expenses and other costs and expenses of defending or preparing to
defend against any claim of liability, unless such loss, liability or expense is
primarily caused by the Escrow Agent's gross negligence, bad faith or willful
misconduct. In no event shall the Escrow Agent be liable for indirect, punitive,
special or consequential losses or damages (including without limitation lost
profits), even if advised of the possibility of such losses or damages and
regardless of the form of action.
2.1.5 Resignation. The Escrow Agent may at any time resign as Escrow
Agent hereunder by providing sixty (60) calendar days' prior written notice of
resignation to the other parties hereto. Prior to the effective date of the
resignation as specified in such notice, Cambrex and Xxxxxxxxxx shall issue to
the Escrow Agent a written instruction authorizing redelivery of the Escrow
Account to a successor escrow agent selected by Cambrex and Xxxxxxxxxx. If no
successor escrow agent is named by Cambrex and Xxxxxxxxxx, the Escrow Agent may
apply to a court of competent jurisdiction for the appointment of a successor
escrow agent. The provisions of 2.1.4 above shall survive the resignation or
removal of the Escrow Agent or the termination of this Environmental Escrow
Agreement.
2.2 Concerning the Special Master.
2.2.1 "Special Master" shall mean an individual retained by the
Parties to address and decide certain issues related to Qualified Expenses, as
defined in Section 1.4.1 and further set forth in this Agreement. The Special
Master shall have experience in the area of environmental Remediation and in
submitting or reviewing invoices for remediation work.
2.2.2 The Special Master shall be jointly designated by the Parties
within thirty (30) days after the execution of this Agreement. If the Parties
are unable to agree on the identity of a Special Master, the Special Master
shall be chosen by the Escrow Agent.
24
2.2.3 All expenses of the Special Master incurred in carrying out his
or her responsibilities under this Agreement shall be paid by the Parties, as
set forth in Paragraph 1.4.5 herein.
ARTICLE III
MISCELLANEOUS
3.1 Entire Agreement. This Environmental Escrow Agreement, including the
Exhibits to this Environmental Escrow Agreement, constitutes the entire
agreement of the parties to this Environmental Escrow Agreement with respect to
the subject matter hereof and supersedes all prior agreements and undertakings,
both written and oral, with respect to the subject matter hereof.
3.2 Notices. All notices, requests, claims, demands and other
communications to any party hereunder must be in writing and must be given by
hand delivery, by courier service or by facsimile to the applicable party at the
following address:
if to Cambrex, to:
Cambrex Corporation
Xxx Xxxxxxxxxxx Xxxxx
Xxxx Xxxxxxxxxx, Xxx Xxxxxx 00000
Attention: General Counsel
with a copy to:
Milbank, Tweed, Xxxxxx & XxXxxx LLP
Xxx Xxxxx Xxxxxxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx X. Arena, Esq.
if to Xxxxxxxxxx, to:
Vertellus Specialties Inc.
000 Xxxxx Xxxxxxxx Xxxxxx
Xxxxx 0000
Xxxxxxxxxxxx, Xxxxxxx 00000
Attention: General Counsel
with a copy to:
Akin Gump Xxxxxxx Xxxxx & Xxxx LLP
0000 Xxx Xxxxxxxxx Xxxxxx, XX
Xxxxxxxxxx, XX 00000
Attention: Xxxxx X. Xxxxx, Esq.
25
if to the Escrow Agent, to:
Xxxxx Fargo Bank, National Association
000 Xxxxx Xxxxxxxx Xxxxxx, 00xx Xxxxx
Xxxxxxxxxxxx, Xxxxxxx 00000-0000
Attention: Xxxx Xxxxxxxxx, Corporate Trust & Escrow Services
or any other address or facsimile number as a party may hereafter specify by
notice to the other parties to this Environmental Escrow Agreement in accordance
with this Section 3.2. Delivery of each notice, request or other communication
will be effective (a) if given by hand delivery or courier service, when
delivered at the address specified in this Section 3.2, or (b) if given by
facsimile transmission, when the facsimile is transmitted to the facsimile
number specified in this Section 3.3 and the appropriate confirmation is
received.
3.3 Disbursements. All disbursements to Xxxxxxxxxx or Cambrex pursuant to
this Environmental Escrow Agreement shall be made via wire transfer of
immediately available funds to the following account:
(i) if to Xxxxxxxxxx, to the following account:
Bank: National City Bank
Location: Indianapolis, Indiana
Account Number: 000-000-000
ABA Number: 000-000-000
Reference: Xxxxxxxxxx Chemicals LLC HOP# 130
Attention: Xxxxx Xxxxxxx
or such other account as such party may hereafter specify to by notice to the
Escrow Agent;
(ii) if to Cambrex, to the following account:
Bank: Bank of New York
Location: Xxx Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000
Account Number: 6106823683
ABA Number: 000000000
Reference: Xxxxxxxxxx Escrow
Attention: Xxxxxxx Xxxxxx
or such other account as such party may hereafter specify to by notice to the
Escrow Agent;
3.4 Amendments and Waivers.
3.4.1 Writing Required. Any provision of this Environmental Escrow
Agreement may be amended or waived if, and only if, such amendment or waiver is
in writing and signed, in the case of an amendment, by Cambrex, Xxxxxxxxxx and
the Escrow Agent or, in the case of a waiver, by the party against whom the
waiver is to be effective.
26
3.4.2 No Implied Waiver. No failure or delay by any party hereto in
exercising any right, power or privilege hereunder will operate as a waiver
thereof nor will any single or partial exercise thereof preclude any other or
further exercise thereof or the exercise of any other right, power or privilege.
3.5 Successors and Assigns. The provisions of this Environmental Escrow
Agreement shall be binding upon and inure to the benefit of the parties to this
Environmental Escrow Agreement and their respective successors and assigns.
Xxxxxxxxxx may transfer or assign in whole or in part its rights and obligations
under this Environmental Escrow Agreement to (i) one or more of its subsidiaries
or affiliates; (ii) any financial institution providing purchase money or other
financing to Xxxxxxxxxx or to one or more of its subsidiaries or affiliates; or
(iii) a purchaser of Xxxxxxxxxx or any portion thereof or a purchaser of any of
the Xxxxxxxxxx Facilities, or a substantial portion of any one of the Xxxxxxxxxx
Facilities, but no such transfer or assignment will relieve Xxxxxxxxxx of any of
its obligations hereunder. No assignment of interests of any of the other
Parties hereto shall be binding upon the Escrow Agent unless and until written
notice of such assignment is provided to and acknowledged by the Escrow Agent.
3.6 Benefit; No Joint Venture. Notwithstanding anything to the contrary
contained in this Environmental Escrow Agreement, nothing in this Environmental
Escrow Agreement, expressed or implied, is intended to confer on any person or
entity other than the parties to this Environmental Escrow Agreement or their
respective successors and assigns, any rights, remedies, obligations or
liabilities under or by reason of this Environmental Escrow Agreement. Neither
this Environmental Escrow Agreement nor anything contained herein shall create
or be deemed to create a partnership, joint venture or other joint or equity
type agreement between Xxxxxxxxxx and Cambrex.
3.7 Tax Issues. The parties acknowledge that the Escrow Agent does not have
any interest in the Escrow Deposit, but is serving only as escrow holder
hereunder. Without limiting the foregoing, but subject to the other provisions
of this Agreement, Xxxxxxxxxx shall be responsible for determining if there are
any taxes relating to the Escrow Deposit, the Escrow Account, all property or
funds on deposit therein and all dividends, distributions, interest, income and
earnings thereon. If it is determined that any such taxes are due and owing,
they may be disbursed to Xxxxxxxxxx from the Escrow Account upon a written
direction to the Escrow Agent from Xxxxxxxxxx.
3.8 Certain Interpretive Matters.
3.8.1 Certain References. Unless the context otherwise requires, all
references in this Environmental Escrow Agreement to Sections or Exhibits are to
Sections or Exhibits of or to this Environmental Escrow Agreement. All
references to "$" or dollar amounts are to lawful currency of the United States
of America.
3.8.2 Titles and Headings. Titles and headings to Sections and
Exhibits in this Environmental Escrow Agreement are inserted for convenience of
reference only, and are not intended to be a part of or to affect the meaning or
interpretation of this Environmental Escrow Agreement.
27
3.8.3 Governing Law. This Environmental Escrow Agreement shall be
construed in accordance with and governed by the internal substantive law of the
State of New York regardless of the laws that might otherwise govern under
principles of conflict of laws applicable thereto.
3.9 Consent to Jurisdiction; Arbitration. Any disputes arising from or
relating to this Environmental Escrow Agreement shall be submitted to and
resolved by binding arbitration conducted in the State of New York, County of
New York, in accordance with the Section 4.1 of the Settlement Agreement.
Judgment on any arbitration award may be entered in any court having
jurisdiction.
3.10 Severability. If any provision of this Environmental Escrow Agreement
is determined by a Governmental or Regulatory Authority to be invalid, void or
unenforceable, the remainder of the provisions of this Environmental Escrow
Agreement will remain in full force and effect and will in no way be affected,
impaired or invalidated.
3.11 Counterparts; Effectiveness. This Environmental Escrow Agreement may
be executed in any number of counterparts, each of which will be an original,
with the same effect as if the signatures thereto were upon the same instrument.
This Environmental Escrow Agreement will become effective when both of the
following events occur: (a) each party to this Environmental Escrow Agreement
receives counterparts hereof signed by the other parties to this Environmental
Escrow Agreement; and (b) each party to this Environmental Escrow Agreement
receives counterparts signed by the other parties to the Settlement Agreement.
IN WITNESS WHEREOF, the parties to this Environmental Escrow Agreement have
caused this Environmental Escrow Agreement to be duly executed by their
respective authorized officers as of the day and year first above written.
CAMBREX:
CAMBREX CORPORATION
By: /s/
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
NEPERA, INC., CASCHEM, INC.,
ZEELAND CHEMICALS, INC., NEPCAM, INC.
By: /s/
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
28
CAMBREX LIMITED
By: /s/
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
XXXXXXXXXX:
XXXXXXXXXX CHEMICALS LLC.,
VERTELLUS SPECIALTIES HOLDINGS CORP.
By: /s/
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
VERTELLUS SPECIALTIES UK LTD.,
VERTELLUS SPECIALTIES HOLDINGS UK LTD.
By: /s/
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
ESCROW AGENT:
XXXXX FARGO BANK, NATIONAL ASSOCIATION,
as escrow agent
By: /s/
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
29
EXHIBIT A
SETTLEMENT AGREEMENT
P. 30
EXHIBIT B
XXXXXXXXXX'X CERTIFICATE OF INSTRUCTION
Pursuant to Section 1.4.4 of the Environmental Escrow Agreement, dated as
of July 30, 2007 (the "Environmental Escrow Agreement"), by and between
Xxxxxxxxxx Chemicals LLC, Vertellus Specialties Holdings UK Ltd (formerly
Xxxxxxxxxx Chemicals UK Ltd.), Vertellus Specialties UK Ltd. (formerly Seal
Sands Chemicals Ltd.), and Vertellus Specialties Holdings Corp. (formerly
Xxxxxxxxxx Chemicals Holdings Corp.) (collectively, "Xxxxxxxxxx"), and Cambrex
Corporation, Nepera, Inc., CasChem Inc., Zeeland, Inc., Nepcam, Inc., and
Cambrex Ltd. (collectively, "Cambrex") and Xxxxx Fargo National Bank, National
Association, as escrow agent (the "Escrow Agent"), Xxxxxxxxxx hereby certifies
to the Escrow Agent and Cambrex that (i) the attached receipts or invoices are
for costs incurred by Xxxxxxxxxx which are Qualified Expenses and (ii)
Xxxxxxxxxx has not previously received funds from the Escrow Account in respect
of such expenses.
The Escrow Agent is hereby instructed to release to Xxxxxxxxxx, on the date
that is no earlier than sixteen (16) calendar days and no later than
twenty-three (23) days after the receipt of this Certificate by the Escrow
Agent, an aggregate amount of $__________ from the Escrow Account in respect of
such Qualified Expenses. If the Escrow Agent receives an Objection to this
Certification from Cambrex within fifteen (15) calendar days after the receipt
of this Certificate by the Escrow Agent, the Escrow Agent is hereby instructed
to release to Xxxxxxxxxx an amount of the Escrow Account equal to the aggregate
amount of such expenses not disputed by such Objection and retain the disputed
amount in accordance with Section 1.4.5 of the Environmental Escrow Agreement.
All terms beginning with initial capital letters not otherwise defined in
this Certificate have the same meaning as set forth in the Environmental Escrow
Agreement.
Dated: XXXXXXXXXX:
------------------------------
XXXXXXXXXX CHEMICALS LLC.,
VERTELLUS SPECIALTIES HOLDINGS CORP.
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
VERTELLUS SPECIALTIES UK LTD.,
VERTELLUS SPECIALTIES HOLDINGS UK LTD.
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
P. 31
EXHIBIT C
CAMBREX'S OBJECTION CERTIFICATE
Pursuant to Section 1.4.5 of the Environmental Escrow Agreement, dated as
of July 30, 2007 (the "Environmental Escrow Agreement"), by and between
Xxxxxxxxxx Chemicals LLC, Vertellus Specialties Holdings UK Ltd (formerly
Xxxxxxxxxx Chemicals UK Ltd.), Vertellus Specialties UK Ltd. (formerly Seal
Sands Chemicals Ltd.), and Vertellus Specialties Holdings Corp. (formerly
Xxxxxxxxxx Chemicals Holdings Corp.) (collectively, "Xxxxxxxxxx"), and Cambrex
Corporation, Nepera, Inc., CasChem Inc., Zeeland, Inc., Nepcam, Inc., and
Cambrex Ltd. (collectively, "Cambrex") and Xxxxx Fargo National Bank, National
Association, as escrow agent (the "Escrow Agent"), Cambrex hereby:
(a) disputes that $_______ of the Owed Amount referred to in the
Certificate of Instruction dated _________, ____ is for Qualified Expenses
and is payable to Xxxxxxxxxx by reason thereof;
(b) certifies that a copy of this Objection Certificate has been served
upon Xxxxxxxxxx;
(c) objects to your making payment to Xxxxxxxxxx in the amount of $_______
as provided in such Certificate of Instruction; and
[(d) does not object to your making payment to Xxxxxxxxxx in the amount of
$________ as provided in such Certificate of Instruction.]
All terms beginning with initial capital letters not otherwise defined in
this Certificate have the same meaning as set forth in the Environmental Escrow
Agreement.
Dated: CAMBREX:
------------------------------
CAMBREX CORPORATION
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
NEPERA, INC., CASCHEM, INC.,
ZEELAND, CHEMICALS, INC., NEPCAM, INC.
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
P. 32
CAMBREX LIMITED
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
P. 33
EXHIBIT D
RESOLUTION CERTIFICATE
Pursuant to Section 1.4.5 of the Environmental Escrow Agreement, dated as
of July 30, 2007 (the "Environmental Escrow Agreement"), by and between
Xxxxxxxxxx Chemicals LLC, Vertellus Specialties Holdings UK Ltd (formerly
Xxxxxxxxxx Chemicals UK Ltd.), Vertellus Specialties UK Ltd. (formerly Seal
Sands Chemicals Ltd.), and Vertellus Specialties Holdings Corp. (formerly
Xxxxxxxxxx Chemicals Holdings Corp.) (collectively, "Xxxxxxxxxx"), and Cambrex
Corporation, Nepera, Inc., CasChem Inc., Zeeland, Inc., Nepcam, Inc., and
Cambrex Ltd. (collectively, "Cambrex") and Xxxxx Fargo National Bank, National
Association, as escrow agent (the "Escrow Agent"), Xxxxxxxxxx and Cambrex
hereby:
(a) certify that (i) Xxxxxxxxxx and Cambrex have resolved their dispute as
to the matter described in the Certificate of Instruction dated __________,
20__ and the related Objection Certificate dated ___________, 20__ and (ii)
the final Owed Amount with respect to the matter described in such
Certificates is $______________; and
(b) agree that the Owed Amount designated in such Certificate of
Instruction, to the extent, if any, it exceeds the Owed Amount referred to
in clause (ii) of paragraph (a) above, shall be deemed not payable to
Xxxxxxxxxx and such Certificate of Instruction is hereby cancelled.
All terms beginning with initial capital letters not otherwise defined in
this Certificate have the same meaning as set forth in the Environmental Escrow
Agreement.
Dated: XXXXXXXXXX:
------------------------------
XXXXXXXXXX CHEMICALS LLC.,
VERTELLUS SPECIALTIES HOLDINGS CORP.
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
VERTELLUS SPECIALTIES UK LTD.,
VERTELLUS SPECIALTIES HOLDINGS UK LTD.
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
P. 34
CAMBREX:
CAMBREX CORPORATION
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
NEPERA, INC., CASCHEM, INC.,
ZEELAND CHEMICALS, INC., NEPCAM, INC.
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
CAMBREX LIMITED
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
P. 35
EXHIBIT E
TAX REPORTING
Pursuant to and in accordance with Section 3.7 of the Environmental Escrow
Agreement, dated as of July 30, 2007 (the "Environmental Escrow Agreement"), the
Escrow Agent shall report the income earned, if any, in the Escrow Account, to
the following entity:
Vertellus Specialties Inc.
000 Xxxxx Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxxxxxxx, Xxxxxxx 00000
Attention: General Counsel
Fed. I.D. No. 00-0000000
P. 36
