SECURITIES PURCHASE AGREEMENT
among
XXXXXXX COMERCIAL DE MEXICO, S. de X.X. de C.V.
WTC HOLDCO I, LLC
MIYAR LLC
NICNA, GmbH,
and
THE SELLER PARTIES NAMED HEREIN
Dated as of December 14, 2004
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TABLE OF CONTENTS
Page
Recitals
SECTION 1. DEFINITIONS 5
SECTION 2. PURCHASE AND SALE OF SHARES 11
SECTION 2.1. Purchase Price 11
SECTION 2.2. Capital Contribution 11
SECTION 3. ADJUSTMENT TO PURCHASE PRICE 11
SECTION 3.1. Closing Date Adjustments 11
SECTION 3.2. Post-Closing Determination 12
SECTION 3.3. Post-Closing Adjustment 12
SECTION 3.4. 2005 EBIT Target Amount 13
SECTION 4. CLOSING 14
SECTION 5. REPRESENTATIONS AND WARRANTIES OF THE SELLER AND
THE SELLER PARTIES 14
SECTION 5.1. Corporate Organization 14
SECTION 5.2. Qualification to Do Business 14
SECTION 5.3. No Conflict or Violation 14
SECTION 5.4. Consents and Approvals 15
SECTION 5.5. Membership Interests and Related Matters 15
SECTION 5.6. Subsidiaries and Equity Investments 15
SECTION 5.7. Financial Statements 15
SECTION 5.8. Absence of Certain Changes or Events 16
SECTION 5.9. Tax Matters 17
SECTION 5.10. Absence of Undisclosed Liabilities 18
SECTION 5.11. Owned Real Property 18
SECTION 5.12. Leases 19
SECTION 5.13. Assets of the Companies 20
SECTION 5.14. Intellectual Property; Intangible Assets 21
SECTION 5.15. Licenses and Permits 21
SECTION 5.16. Compliance with Law 22
SECTION 5.17. Litigation 22
SECTION 5.18. Contracts 22
SECTION 5.19. Inventories 23
SECTION 5.20. Employee Plans 23
SECTION 5.21. Customers and Suppliers 23
SECTION 5.22. Insurance 24
SECTION 5.23. Transactions with Directors, Officers and Affiliates 24
SECTION 5.24. Change in Ownership 24
SECTION 5.25. Receivables and Payables 25
SECTION 5.26. Labor Matters 25
SECTION 5.27. Environmental Matters 26
SECTION 5.28. Products Liability 26
SECTION 5.29. Grupo Nicna Reorganization 27
SECTION 5.30. Accuracy of Information 27
SECTION 5.31. Incorporation by Reference 28
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SECTION 6. ADDITIONAL REPRESENTATIONS AND WARRANTIES OF THE SELLER
AND THE SELLER PARTIES 28
SECTION 6.1. Corporate Organization 28
SECTION 6.2. Qualification to Do Business 28
SECTION 6.3. Title to the Common Shares 28
SECTION 6.4. Authorization and Validity of Agreement 28
SECTION 6.5. No Conflict or Violation 29
SECTION 7. REPRESENTATIONS AND WARRANTIES OF THE BUYER 29
SECTION 7.1. Corporate Organization 29
SECTION 7.2. Qualification to Do Business 29
SECTION 7.3. Authorization and Validity of Agreement 29
SECTION 7.4. No Conflict or Violation 29
SECTION 7.5. Consents and Approvals 30
SECTION 8. COVENANTS OF THE SELLER AND THE SELLER PARTIES 30
SECTION 8.1. Consents and Approvals 30
SECTION 8.2. Access to Properties and Records 30
SECTION 8.3. Best Efforts 31
SECTION 8.4. Covenant Not To Compete 31
SECTION 8.5. Non-Solicitation of Employees 31
SECTION 8.6. Liquid Assets 31
SECTION 9. TAXES 32
SECTION 9.1. Pre-Closing Taxes 32
SECTION 9.2. Cooperation on Tax Matters 32
SECTION 9.3. Certain Taxes 32
SECTION 10. INDEMNIFICATION 32
SECTION 10.1. Survival 32
SECTION 10.2. Indemnification by the Seller and the Seller
Parties 33
SECTION 10.3. Indemnification by the Xxxxxxx Comercial 33
SECTION 10.4. Procedures for Indemnification 34
SECTION 11. CONDITIONS PRECEDENT TO PERFORMANCE BY THE SELLER AND THE
SELLER PARTIES 35
SECTION 11.1. Representations and Warranties of the Buyer 35
SECTION 11.2. Performance of the Obligations of the Buyer 35
SECTION 11.3. No Violation of Orders 35
SECTION 12. CONDITIONS PRECEDENT TO PERFORMANCE BY THE BUYER 35
SECTION 12.1. Representations and Warranties of the Seller
Parties and the Seller 35
SECTION 12.2. Performance of the Obligations of the Seller
Parties and the Seller 36
SECTION 12.3. Consents and Approvals 36
SECTION 12.4. No Violation of Orders 36
SECTION 12.5. Opinion of Counsel 36
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SECTION 12.6. Escrow Agreement 36
SECTION 12.7. Mortgage Release 36
SECTION 12.8. Other Closing Documents 36
SECTION 12.9. Legal Matters 37
SECTION 13. MISCELLANEOUS 37
SECTION 13.1. Successors and Assigns 37
SECTION 13.2. Governing Law, Jurisdiction 37
SECTION 13.3. Expenses 38
SECTION 13.4. Broker's and Finder's Fees 38
SECTION 13.5. Severability 38
SECTION 13.6. Notices 38
SECTION 13.7. Amendments; Waivers 40
SECTION 13.8. Entire Agreement 40
SECTION 13.9. Parties in Interest 40
SECTION 13.10. Scheduled Disclosures 40
SECTION 13.11. Section and Paragraph Headings 40
SECTION 13.12. Counterparts 40
SECTION 13.13. Language 40
SECTION 13.14. Monetary Denominations 42
SECTION 13.15. Construction 42
Exhibit A Grupo Nicna Reorganization
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SECURITIES PURCHASE AGREEMENT
SECURITIES PURCHASE AGREEMENT, dated as of December 14, 2004,
by and among Xxxxxxx Comercial de Mexico, S. de X.X. de C.V., a Mexican
sociedad de responsabilidad limitada de capital variable ("Xxxxxxx
Comercial"), WTC HoldCo I, LLC, a Delaware limited liability company ("WTC
HoldCo I" and, together with Xxxxxxx Comercial, the "Buyer"), Miyar, LLC, a
Delaware limited liability company ("Miyar"), Nicna, GmbH, a Swiss limited
liability company ("Nicna" and, together with Miyar, the "Seller"), Xxxx
Xxxxxxx Cirano and Xxxxxxx Xxxxxx Wengrowsky (Xx. Xxxxxxx Cirano and Xx.
Xxxxxx Wengrowsky together, the "Seller Parties").
W I T N E S S E T H:
WHEREAS, the Seller owns all of the issued and outstanding
membership interests (the "Shares") of NICNA Mexico, S. de X.X. de C.V.
("NICNA Mexico"), NICNA Mexico Servicios, S. de X.X. de C.V. ("NICNA
Servicios"), NICNA Mexico Maquinaria, S. de X.X. de C.V. ("NICNA
Maquinaria"), NICNA Mexico Ventas, S. de X.X. de C.V. ("NICNA Ventas"), NICNA
Mexico Proyectos, S. de X.X. de C.V. ("NICNA Proyectos") and NICNA Mexico
Comercial, S. de X.X. de C.V. ("NICNA Comercial") (each, individually, a
"Company" and collectively, the "Companies"), each of which is a Mexican
sociedad de responsabilidad limitada de capital variable;
WHEREAS, on December 8, 2004, the Companies completed the
reorganization described on Exhibit A hereto (the "Grupo Nicna
Reorganization") pursuant to which Niples Del Norte S.A. de C.V. ("Niples del
Norte"), Ninsa de Mexico, S.A. de C.V., Niples y Coples del Norte, S.A. de
C.V. and Niples y Conexiones del Norte, S.A. de C.V. (each, individually, a
"Niples Company" and collectively, the "Niples Companies" and together with
the Seller, "Grupo Nicna") transferred certain of their respective assets to
the Companies;
WHEREAS, Grupo Nicna is owned, directly or indirectly, by the
Seller Parties;
NOW, THEREFORE, in consideration of the foregoing and the
respective covenants and agreements hereinafter contained, the parties hereby
agree as follows:
SECTION 1. DEFINITIONS. As used in this Agreement, the following
terms shall have the following meanings:
"Adjustment" -- See Section 3.3;
"Affiliates" shall mean any Person, directly or indirectly,
controlling, controlled by or under common control with such Person;
"Business Day" shall mean a day other than a Saturday, Sunday or
other day on which banks in the States of New York or the State of Nuevo
Xxxx, Mexico, are not required or authorized by law to close;
"Buyer" -- See Preamble hereto;
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"Cash Purchase Price" -- See Section 2.1;
"Cash Escrow Amount" -- See Section 2.1;
"Closing" -- See Section 4;
"Closing Balance Sheet" -- See Section 3.2;
"Closing Balance Sheet Report" -- See Section 3.2;
"Closing Date" -- See Section 4;
"Companies" or "Company" -- See Recitals hereto;
"Contracts" shall mean, collectively, the Leases, Purchase
Orders, Sales Orders and Other Contracts, including, without limitation,
those described in Section 5.18 hereto;
"Employment Agreement" shall mean the employment agreement, dated
as of the dated hereof, between Xxxx Xxxxxxx Cirano and Xxxxxxx Comercial;
"Environmental Claim" -- See Section 5.27(g);
"Environmental Laws" shall mean any federal, state, or local
statute, regulation, ordinance, order, decree, or other requirement of law
relating to the environment or to the identification, transportation,
handling, discharge, emission, treatment, storage, or disposal of any
pollutant, contaminant, hazardous or solid waste, or any hazardous or toxic
substance or material, including, but not limited to, the Mexican Ley Federal
del Equilibrio Ecologico y Proteccion al Ambiente, the Mexican Ley de Aguas
Nacionales, the Mexican Reglamentos de Impacto Ambiental y de Residuos
Peligrosos, and any and all official regulations (Normas Oficiales Mexicanas)
issued by the Mexican Ministry of Environment and Natural Resources;
"Equipment and Machinery" shall mean all the equipment,
machinery, furniture, fixtures and improvements, tooling, spare parts,
supplies and vehicles owned, leased or used by the Companies, including
without limitation any such equipment, machinery, furniture, fixtures and
improvements, tooling, spare parts, supplies and vehicles transferred by a
Niples Company to a Company pursuant to the Grupo Nicna Reorganization;
"Escrow Agent" shall mean the financial institution acting as
escrow agent under the Escrow Agreement;
"Escrow Agreement" shall mean that certain escrow agreement,
dated as of the date hereof, by and among Xxxxxxx Comercial, the Seller and
the Escrow Agent;
"Estimated Closing Balance Sheet" -- See Section 3.1;
"Estimated Net Assets" -- See Section 3.1;
"Financial Statements" -- See Section 5.7;
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"GAAP" shall mean United States and Mexican generally accepted
accounting principles, applied as described on Schedule 1.1;
"Governmental Entity" shall mean any federal, state or foreign
governmental or public body, agency or authority;
"Grupo Nicna" -- See Recitals hereto;
"Grupo Nicna Reorganization" -- See Recitals hereto;
"Grupo Niples" -- See Recitals hereto;
"Grupo Xxxxxx" shall mean Grupo Xxxxxx X.X. de C.V.;
"Hazardous Substance" shall mean any element, substance, remnant
or mixture of any hazardous or toxic wastes or materials that,
notwithstanding its physical condition, represents a risk for the
environment, health or natural resources, given its corrosive, reactive,
explosive, toxic, flammable or biologically harmful nature;
"Indemnitee" - See Section 10.4;
"Indeminitor" - See Section 10.4;
"Independent Accounting Firm" -- See Section 3.2;
"Intangible Assets" shall mean all intangible personal property
rights, including, without limitation, all rights on the part of any Company
to proceeds of any insurance policy and all claims on the part of any Company
for recoupment, reimbursement and coverage under any insurance policy and all
goodwill of any Company, and including, without limitation, those items (i)
listed on Schedule 5.14 and/or (ii) transferred by a Niples Company to a
Company pursuant to the Grupo Nicna Reorganization;
"Intellectual Property" shall mean all of the following owned,
issued or licensed to any Company : (i) all inventions (whether patentable or
unpatentable and whether or not reduced to practice), all improvements
thereto, and all patents, patent applications and patent disclosures,
together with all reissuances, continuations, continuations-in-part,
revisions, extensions and reexaminations thereof; (ii) all trademarks,
service marks, trade dress, logos, trade names and corporate names, together
with all translations, adaptations, derivations and combinations thereof and
including all goodwill associated therewith, and all applications,
registrations and renewals in connection therewith; (iii) all copyrightable
works (including, without limitation, all software developed by any Company
or by any Niples Company and transferred to a Company pursuant to the Grupo
Nicna Reorganization), all copyrights, and all applications, registrations
and renewals in connection therewith; (iv) all mask works and all
applications, registrations and renewals in connection therewith; (v) all
trade secrets and confidential business information (including ideas,
research and development, know-how, formulas, compositions, manufacturing and
production processes and techniques, technical data, designs, drawings,
specifications, customer and supplier lists, pricing and cost information,
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and business and marketing plans and proposals); (vi) all computer software
(including data and related documentation); (vii) all other proprietary
rights; and (viii) all copies and tangible embodiments thereof (in whatever
form or medium), including, without limitation, those items (i) listed on
Schedule 5.14 hereto and/or (ii) transferred by a Niples Company to a Company
pursuant to the Grupo Nicna Reorganization;
"Inventory" -- See Section 5.19(a);
"Inventory Purchase Agreement" shall mean that certain Inventory
Purchase Agreement, dated as of the date hereof, by and between Niples del
Norte, the other sellers party thereto and Xxxxxxx de Mexico S.A. de C.V.;
"June 30, 2004 Balance Sheet" shall mean the pro forma
consolidating balance reflecting the assets, liabilities and stockholders'
equity of the Transferred Business and Southland as of June 30, 2004 and
attached as Exhibit B to the letter of intent dated September 16, 2004 from
Xxxxxxx Industries, Inc. to Xxxxxxx Xxxxxx Wengrowsky and Xxxx Xxxxxxx
Cirano;
"Leased Real Property" -- See Section 5.12;
"Lease" or "Leases" -- See Section 5.12;
"Licenses and Permits" -- See Section 5.15;
"Lien" shall mean any mortgage, pledge, security interest,
encumbrance, lien (statutory or other), conditional sale agreement, claim,
charge, limitation or restriction;
"Liquid Assets" -- See Section 8.6;
"Loan Repayment Intercompany Note (Comercial)" shall mean that
certain Xxxxxx Causal, dated as of December 8, 2004, issued by NICNA
Comercial to Niples del Norte;
"Loan Repayment Intercompany Note (Maquinaria)" shall mean that
certain Xxxxxx Causal, dated as of December 8, 2004, issued by NICNA
Maquinaria to Niples del Norte in connection with the payment of the purchase
price for certain equipment and machinery and associated Value Added Tax;
"Losses" -- See Section 10.2;
"Xxxxxxx Comercial" -- See Preamble hereto;
"Net Assets" shall mean an amount equal to the aggregate assets
of the Companies and Southland (net of reserves) as of the opening of
business on the Closing Date less the aggregate liabilities of the Companies
and Southland as of such time (other than liabilities under the Loan
Repayment Intercompany Note (Maquinaria) and the Loan Repayment Intercompany
Note (Comercial) repaid on the Closing Date in accordance with Section 2.2),
determined in each case in accordance with GAAP applied on a basis consistent
with, and following the accounting principles, procedures, policies and
methods employed in preparing, the June 30, 2004 Balance Sheet;
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"NICNA Maquinaria" -- See Recitals hereto;
"Niples Companies" or "Niples Company" -- See Recitals hereto;
"Niples del Norte" -- See Recitals hereto;
"Non-Compete Agreements" -- shall mean the Non-Compete
Agreements, each dated the date hereof, and executed by each Seller Party;
"Occurrence" - See Section 5.28;
"Other Contracts" shall mean all Equipment and Machinery leases,
and all indentures, loan agreements, security agreements, partnership or
joint venture agreements, license agreements, maintenance contracts, service
contracts, employment, commission and consulting agreements, suretyship
contracts, letters of credit, reimbursement agreements, distribution
agreements, contracts or commitments limiting or restraining any Company from
engaging or competing in any lines of business or with any Person, agreements
not made in the ordinary course of business of any Company, options to
purchase any assets or property rights of any Company, working capital
maintenance or other form of guaranty agreements, and all other agreements to
which any Company is a party, but excluding Leases, Purchase Orders and Sales
Orders ;
"Person" shall mean any individual, corporation, partnership,
limited liability company, joint venture, association, joint-stock company,
trust, unincorporated organization or Governmental Entity;
"Process Agent" -- See Section 13.2(e);
"Product Liability Lawsuits" -- See Section 5.28(a);
"Products" -- See Section 5.28(a);
"Purchase Orders" shall mean all the Companies' outstanding
purchase orders, contracts or other commitments to suppliers of goods and
services for materials, supplies or other items used in their businesses,
including, without limitation, any such purchase orders, contracts or other
commitments transferred to a Company pursuant to the Grupo Nicna
Reorganization;
"Representatives" -- See Section 8.2;
"Retrofits" -- See Section 5.28;
"Sales Orders" shall mean all of the Companies' sales orders,
contracts or other commitments to purchasers of goods and services of its
businesses;
"Seller" -- See Preamble hereto;
"Seller Parties" -- See Preamble hereto;
"Shares" -- See Recitals hereto;
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"Southland" shall mean Southland Pipes Nipples Co., Inc., a Texas
corporation;
"Southland Purchase Agreement" shall mean the Securities Purchase
Agreement (Southland), dated as of the date hereof, by and between Xxxxxxx
Streamline Co., Xxxx Xxxxxxx Cirano and Xxx Xxxxx Xxxxxxx;
"Subsidiary" shall mean, with respect to any Person, any entity,
whether incorporated or unincorporated, of which at least a majority of the
securities or ownership interests having by their terms ordinary voting power
to elect a majority of the board of directors or other Persons performing
similar functions is directly or indirectly owned or controlled by such
Person or by one or more of its respective Subsidiaries or by such Person and
any one or more of its respective Subsidiaries;
"Tax Return" shall mean any report, return, information return,
filing, claim for refund or other information, including any schedules or
attachments thereto, and any amendments to any of the foregoing required to
be supplied to a taxing authority in connection with Taxes;
"Taxes" shall mean all federal, state, local or foreign taxes,
including, without limitation, income, gross income, gross receipts,
production, excise, employment, sales, use, transfer, ad valorem, profits,
license, capital stock, franchise, severance, stamp, withholding, Social
Security, employment, unemployment, disability, worker's compensation,
payroll, utility, windfall profit, custom duties, personal property, real
property, registration, alternative or add-on minimum, estimated and other
taxes, governmental fees or like charges of any kind whatsoever, including
any interest, penalties or additions thereto, whether disputed or not; and
"Tax" shall mean any one of the foregoing;
"Transaction Documents" shall mean this Agreement, the Southland
Purchase Agreement, the Inventory Purchase Agreement, the Escrow Agreement,
the Employment Agreement and the Non-Compete Agreements;
"Transferred Business" shall mean the business of the Niples
Companies transferred to the Companies pursuant to the Grupo Nicna
Reorganization;
"2005 EBIT" shall mean, for the fiscal year ending on or about
December 31, 2005, the consolidated net income of the Buyer and its
Subsidiaries, plus, without duplication and to the extent deducted from
revenues in determining such consolidated net income, the sum of (i) the
aggregate amount of interest expense paid or payable by Xxxxxxx Comercial or
its Subsidiaries for such period and (ii) the aggregate amount of income Tax
expenses for such period, computed in accordance with, and on the basis of,
the 2005 Financial Statements and further adjusted as provided in Section
3.4;
"2005 Financial Statements" -- See Section 3.4; and
"2005 Financial Statements Report" -- See Section 3.4.
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SECTION 2. PURCHASE AND SALE OF SHARES.
SECTION 2.1. Purchase Price. Subject to the terms and
conditions set forth in this Agreement and in reliance upon the
representations and warranties of the Seller and the Seller Parties set forth
below, on the Closing Date, (i) Xxxxxxx Comercial shall purchase from Nicna
and Nicna shall sell to Xxxxxxx Comercial the Shares owned by Nicna and (ii)
WTC HoldCo I shall purchase from Miyar and Miyar shall sell to WTC HoldCo I
the Shares owned by Miyar, in each case, free and clear of all Liens.
Subject to adjustment as provided in Section 3, the aggregate purchase price
for the Shares being purchased under this Agreement shall consist of (i)
twenty five million four hundred eighty seven thousand dollars ($25,487,000)
in cash (the "Cash Purchase Price") and (ii) three million dollars
($3,000,000) in cash (the "Cash Escrow Amount") to be placed in escrow in
accordance with the terms of the Escrow Agreement. Against delivery by each
Buyer (i) to the Seller of the Cash Purchase Price for such Shares and
(ii) to the Escrow Agent of the Cash Escrow Amount, for such Shares, the
Seller shall record in each Company's special members' ledger (libro especial
de socios) the transfer of the relevant Shares in favor of Buyer. Payments
of the Cash Purchase Price shall be made by wire transfer of immediately
available funds to such account(s) as the Seller shall specify and payment of
the Cash Escrow Amount to the Escrow Agent shall be made in accordance with
the terms of the Escrow Agreement.
SECTION 2.2. Capital Contribution. Subject to the terms and
conditions set forth in this Agreement and in reliance upon the
representations and warranties of the Seller and the Seller Parties set forth
below, on the Closing Date the Buyer shall make a capital contribution in the
amount of (i) one million sixty three thousand eight hundred eighty dollars
($1,063,880) to NICNA Maquinaria for the purpose of immediately repaying all
amounts due by NICNA Maquinaria under the Loan Repayment Intercompany Note
(Maquinaria) and (ii) nine hundred thirteen thousand seven hundred fifty six
dollars ($913,756) to NICNA Comercial for the purpose of immediately repaying
all amounts due by NICNA Comercial under the Loan Repayment Intercompany Note
(Comercial).
SECTION 3. ADJUSTMENT TO PURCHASE PRICE.
The Cash Purchase Price shall be subject to adjustment as
follows:
SECTION 3.1. Closing Date Adjustments. The Seller and the
Buyer have, in good faith using the Companies' and Southland's then available
financial information, jointly prepared an estimated consolidated balance
sheet of the Companies and Southland as of the opening of business on the
Closing Date, assuming repayment of the notes referred to in Section 2.2 (the
"Estimated Closing Balance Sheet") setting forth an estimate of the Net
Assets in the amount of $19,801,000 dollars (the "Estimated Net Assets").
The Estimated Closing Balance Sheet was prepared in accordance with GAAP,
applied on a basis consistent with, and following the accounting principles,
procedures, policies and methods employed in preparing, the June 30, 2004
Balance Sheet.
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SECTION 3.2. Post-Closing Determination. Not later than 60
calendar days after the Closing Date, the Buyer shall deliver to the Seller
the consolidated balance sheet of the Companies and Southland as of the
opening of business on the Closing Date, assuming repayment of the notes
referred to in Section 2.2 (the "Closing Balance Sheet"), prepared in
accordance with GAAP, applied on a basis consistent with, and following the
accounting principles, procedures, policies and methods employed in
preparing, the June 30, 2004 Balance Sheet (including without limitation with
respect to the computation of reserves) and reflecting the results of an
inventory count to be completed by the Seller as soon as practicable prior to
the Closing Date. The Closing Balance Sheet shall set forth a calculation of
the Net Assets. During the preparation of the Closing Balance Sheet by the
Buyer and the period of any dispute with respect to the application of this
Section 3.2, the Seller shall cooperate with the Buyer to the extent
reasonably requested by the Buyer to prepare the Closing Balance Sheet or to
investigate the basis for any dispute. The Closing Balance Sheet shall be
examined by the Seller, and the Seller shall, not later than 30 calendar days
after receipt of the Closing Balance Sheet, render a report thereon (the
"Closing Balance Sheet Report"). The Closing Balance Sheet Report shall list
those items, if any, to which the Seller takes exception and the Seller's
proposed adjustment. If the Seller fails to deliver to the Buyer the Closing
Balance Sheet Report within 30 calendar days following receipt of the Closing
Balance Sheet, the Seller shall be deemed to have accepted the Closing
Balance Sheet for the purposes of any adjustment to the Cash Purchase Price
under Section 3.3. If the Buyer does not give the Seller notice within 20
calendar days following receipt of the Closing Balance Sheet Report, the
Buyer shall be deemed to have accepted the Closing Balance Sheet as adjusted
by the Seller for the purposes of any adjustment to the Cash Purchase Price
under Section 3.3. If the Buyer gives the Seller notice of objections to the
Closing Balance Sheet Report, and if the Seller and the Buyer are unable,
within 15 calendar days after receipt by the Seller of the notice from the
Buyer of objections, to resolve the disputed exceptions, such disputed
exceptions will be referred to Xxxxx Xxxxxxxx or another firm of independent
certified public accountants ("Independent Accounting Firm") mutually
acceptable to the Seller and the Buyer. The Independent Accounting Firm
shall, within 60 days following its selection, deliver to the Seller and the
Buyer a written report determining such disputed exceptions, and its
determinations with respect thereto shall be conclusive and binding upon the
parties hereto for the purposes of any adjustment to the Cash Purchase Price
under Section 3.3. The fees and disbursements of the Independent Accounting
Firm shall be shared equally by the Buyer, on the one hand, and the Seller,
on the other hand.
SECTION 3.3. Post-Closing Adjustment. The Cash Purchase
Price shall be increased or decreased, as the case may be, by an amount (the
"Adjustment") equal to the difference between the Estimated Net Assets and
the Net Assets as finally determined pursuant to Section 3.2. If the Net
Assets set forth on the Closing Balance Sheet exceeds the Estimated Net
Assets, the Cash Purchase Price shall be increased by the amount of such
excess and the Buyer shall pay such excess to the Seller. If the Net Assets
set forth on the Closing Balance Sheet is less than the Estimated Net Assets,
the Cash Purchase Price shall be reduced by the amount of such deficiency and
the Seller shall pay such deficiency to the Buyer. Any payment under this
Section 3.3 shall be made within three calendar days following the
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preparation or computation and final determination, pursuant to Section 3.2,
of the Closing Balance Sheet by wire transfer of immediately available funds
to such account as the Buyer or the Seller, as the case may be, shall
designate in writing to the Seller or the Buyer, as the case may be.
SECTION 3.4. 2005 EBIT Target Amount. The Buyer shall
deliver to the Seller, within ten (10) days following the Buyer's receipt
thereof but in no event later than April 30, 2006 (unless delay in completion
of the 2005 Financial Statements is caused by Xxxx Xxxxxxx Cirano), the
audited consolidated financial statements of the Buyer, its Subsidiaries and
Southland at and for the calendar year ending December 31, 2005 (the "2005
Financial Statements") and the computation of the 2005 EBIT; provided that if
at any time prior to December 31, 2005 an event or change to the operation of
the business which affects the 2005 EBIT calculation is expected to occur and
in the reasonable judgment of Xxxx Xxxxxxx Cirano (or such representative of
the Seller as shall be reasonably acceptable to the Buyer) and Xxxxxxx Xxxxx
(or such representative of the Buyer as shall be reasonably acceptable to the
Seller), the computation of the 2005 EBIT should be adjusted in light of such
event or change to the business, Xxxx Xxxxxxx Cirano and Xxxxxxx Xxxxx (or
the substitute representatives referred to above) may agree to such
adjustment in writing prior to the occurrence of such event or implementation
of the business change, and the computation of the 2005 EBIT pursuant to this
Section 3.4 shall be adjusted accordingly; provided, however, that to the
extent such event or business change is within the control of the Buyer, such
agreement shall be a condition to the occurrence of such event or
implementation of such business change. The 2005 Financial Statements shall
be prepared in accordance with GAAP, applied on a basis consistent with, and
following the accounting principles, procedures, policies and methods
employed in preparing, the Financial Statements. The 2005 Financial
Statements shall be examined by the Seller, and the Seller shall, not later
than 30 calendar days after receipt of the 2005 Financial Statements, render
a report thereon (the "2005 Financial Statements Report"). The 2005
Financial Statements Report shall list those items, if any, to which the
Seller takes exception and the Seller's proposed adjustment. If the Seller
fails to deliver to the Buyer the 2005 Financial Statements Report within 30
calendar days following receipt of the 2005 Financial Statements, the Seller
shall be deemed to have accepted the 2005 Financial Statements for the
purposes of any adjustment to the Cash Purchase Price based on the 2005 EBIT
under Section 3.4. If the Buyer does not give the Seller notice within 20
calendar days following receipt of the 2005 Financial Statements Report, the
Buyer shall be deemed to have accepted the 2005 Financial Statements as
adjusted by the Seller for the purposes of any adjustment to the Cash
Purchase Price based on the 2005 EBIT under Section 3.4. If the Buyer gives
the Seller notice of objections to the 2005 Financial Statements Report, and
if the Seller and the Buyer are unable, within 15 calendar days after receipt
by the Seller of the notice from the Buyer of objections, to resolve the
disputed exceptions, such disputed exceptions will be referred to the
Independent Accounting Firm. The Independent Accounting Firm shall, within
60 days following its selection, deliver to the Seller and the Buyer a
written report determining such disputed exceptions, and its determinations
will be conclusive and binding upon the parties hereto for the purposes of
any adjustment to the Cash Purchase Price based on the 2005 EBIT under
Section 3.4. The fees and disbursements of the Independent Accounting Firm
shall be shared equally by the Buyer, on the one hand, and the Seller, on the
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other hand. If the 2005 EBIT is less than $6,445,000, the full amount then in
the Escrow Account (as defined in the Escrow Agreement) shall be paid to the
Buyer in accordance with the terms of the Escrow Agreement. If the 2005
Financial Statements are not delivered to the Seller by April 30, 2006
(unless delay in completion of the 2005 Financial Statements is caused by
Xxxx Xxxxxxx Cirano), or if the 2005 EBIT is at least $6,445,000, the full
amount then in the Escrow Account shall be released in accordance with the
terms of the Escrow Agreement.
SECTION 4. CLOSING.
The closing (the "Closing") of the consummation of the
transactions contemplated by this Agreement shall take place at the offices
of Xxxxxxx Xxxx & Xxxxxxxxx LLP at 000 Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx
00000 at 10:00 a.m. on the date hereof, or at such other place and time as
may be mutually agreed to by the parties hereto (the "Closing Date").
SECTION 5. REPRESENTATIONS AND WARRANTIES OF THE SELLER AND THE
SELLER PARTIES.
The Seller and the Seller Parties hereby jointly and severally
represent and warrant to the Buyer as follows:
SECTION 5.1. Corporate Organization. Each Company is a
sociedad de responsabilidad limitada de capital variable duly organized and
validly existing under the laws of Mexico, and has all requisite corporate
power and authority to own its properties and assets and to conduct its
business as now conducted. Copies of the Certificate or Articles of
Incorporation and By-laws (or equivalent documents) of each Company, with all
amendments thereto to the date hereof, have been furnished to the Buyer or
its representatives, and such copies are accurate and complete as of the date
hereof.
SECTION 5.2. Qualification to Do Business. Each Company is
duly qualified to do business as a foreign corporation and is in good
standing in every jurisdiction in which the character of the properties owned
or leased by it or the nature of the business conducted by it makes such
qualification necessary. Schedule 5.2 sets forth all foreign jurisdictions
in which each Company is qualified to do business.
SECTION 5.3. No Conflict or Violation. The execution,
delivery and performance by the Seller and the Seller Parties of this
Agreement and the other Transaction Documents do not and will not violate or
conflict with any provision of the Certificate or Articles of Incorporation or
By-laws (or equivalent documents) of any Company and do not and will not
violate any provision of law, or any order, judgment or decree of any court or
Governmental Entity, nor violate nor result in a breach of or constitute
(with due notice or lapse of time or both) a default under any Contract to
which any Company is a party or by which it is bound or to which any of its
properties or assets is subject, nor result in the creation or imposition of
any Lien upon any of the assets, properties or rights of any Company, nor
result in the cancellation, modification, revocation or suspension of any of
the Licenses and Permits.
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SECTION 5.4. Consents and Approvals. Schedule 5.4 sets forth
a true and complete list of each consent, waiver, authorization or approval of
any Governmental Entity, or of any other Person, and each declaration to or
filing or registration with any such Governmental Entity, that is required in
connection with the execution and delivery of this Agreement and the other
Transaction Documents by the Seller and the Seller Parties or the performance
by the Seller and the Seller Parties of their obligations hereunder and
thereunder. All such consents, waivers, authorizations and approvals have
been obtained and all such declarations and filings have been made.
SECTION 5.5. Membership Interests and Related Matters.
Schedule 5.5 contains a certification issued by the Secretary of the Board of
Managers of each Company setting forth the outstanding membership interest
thereof. None of the Companies has outstanding any securities convertible
into or exchangeable for any membership or other equity interest, any rights
to subscribe for or to purchase or any options for the purchase of, or any
agreements providing for the issuance (contingent or otherwise) of, or any
calls, commitments or claims of any other character relating to the issuance
of, any membership interests or securities convertible into or exchangeable
for any membership or other equity interest; and none of the Companies is
subject to any obligation (contingent or otherwise) to repurchase or
otherwise acquire or retire, or to register under applicable law, any
membership interests, except as provided by applicable Law. Schedule 5.5
sets forth the names of the beneficial and record owners of the Shares and
the number of Shares held by each such owner. The Shares have been duly
authorized and validly issued and are fully paid and nonassessable.
SECTION 5.6. Subsidiaries and Equity Investments. None of
the Companies, directly or indirectly, owns or holds any rights to acquire any
capital stock or any other securities, interests or investments in any other
Person other than investments which constitute cash or cash equivalents.
SECTION 5.7. Financial Statements. The Seller has heretofore
furnished to the Buyer (a) copies of the pro forma consolidated balance sheet
of the Companies as of November 30, 2004, together with the related pro forma
statements of income for the twelve month period then ended, in each case
computed on the assumption that the Grupo Nicna Reorganization was completed
as of such date and (b) copies of the June 30, 2004 Balance Sheet, together
with the related unaudited pro forma statements of income for the twelve
month period then ended (all the financial statements referred to in clauses
(a) and (b) above being hereinafter collectively referred to as the
"Financial Statements"). Except as set forth on Schedule 5.7, the Financial
Statements (i) were prepared in accordance with GAAP applied on a consistent
basis throughout the periods covered thereby (except that the Financial
Statements are not accompanied by notes or other textual disclosure required
by GAAP), (ii) present fairly in all material respects the financial
position, results of operations and changes in financial position of the
Transferred Business as of such dates and for the periods then ended
(subject, in the case of the unaudited interim Financial Statements, to
normal year-end audit adjustments consistent with prior periods), (iii) are
complete, correct and in accordance with the books of account and records of
the Companies and Grupo Xxxxxx, (iv) can be legitimately reconciled with the
financial statements and the financial records maintained and the accounting
methods applied by the Seller for federal income tax purposes and (v) reflect
accurately all costs and expenses of the Transferred Business.
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SECTION 5.8. Absence of Certain Changes or Events.
(a) Except for the Grupo Nicna Reorganization and as set
forth on Schedule 5.8, since June 30, 2004, there has not been:
(i) any material adverse change in the business, operations,
properties, assets or condition (financial or other) of any Company or any
Niples Company, or any event that has had a material adverse effect on the
foregoing, and no factor or condition exists and no event has occurred that
would be likely to result in any such change;
(ii) any material loss, damage, destruction or other
casualty to the assets or properties of any Company or any Niples Company
(other than any for which insurance awards have been received or guaranteed);
(iii) any change in any method of accounting or accounting
practice of any Company or any Niples Company; or
(iv) any loss of the employment, services or benefits of any
key employee of any Company or any Niples Company.
(b) Since June 30, 2004 and except for the Grupo Nicna
Reorganization, each Company and each Niples Company has operated in the
ordinary course of its business consistent with past practice and, except as
set forth on Schedule 5.8 hereto, has not:
(i) incurred any material obligation or liability (whether
absolute, accrued, contingent or otherwise) except in the ordinary course of
business consistent with past practice;
(ii) failed to discharge or satisfy any Lien or pay or
satisfy any obligation or liability (whether absolute, accrued, contingent or
otherwise), other than liabilities being contested in good faith and for
which adequate reserves have been provided and Liens arising in the ordinary
course of business that do not, individually or in the aggregate, interfere
with the use, operation, enjoyment or marketability of any of its assets,
properties or rights;
(iii) mortgaged, pledged or subjected to any Lien any of its
assets, properties or rights, except for mechanics' Liens and Liens for taxes
not yet due and payable and Liens arising in the ordinary course of business
that do not, individually or in the aggregate, interfere with the use,
operation, enjoyment or marketability of any of its assets, properties or
rights;
(iv) sold or transferred any of its assets or canceled any
debts or claims or waived any rights, except in the ordinary course of
business consistent with past practice;
(v) disposed of any patents, trademarks or copyrights or any
patent, trademark or copyright applications;
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(vi) defaulted on any material obligation;
(vii) entered into any transaction material to its business,
except in the ordinary course of business consistent with past practice;
(viii) written down the value of any inventory or written off
as uncollectible any of its accounts receivable or any portion thereof not
reflected on the June 30, 2004 Balance Sheet;
(ix) granted any increase in the compensation or benefits of
its employees other than increases in accordance with past practice not
exceeding 5% or entered into any employment or severance agreement or
arrangement with any of them;
(x) made any capital expenditure in excess of $30,000, or
additions to property, plant and equipment used in its operations other than
ordinary repairs and maintenance;
(xi) laid off any of its employees;
(xii) discontinued the sale of any products or product line
or program;
(xiii) incurred any obligation or liability for the payment
of severance benefits;
(xiv) declared, paid or set aside for payment any dividend or
other distribution in respect of shares of its capital stock or other
securities, or redeemed, purchased or otherwise acquired, directly or
indirectly, any shares of its capital stock or other securities, or agreed to
do so; or
(xv) entered into any agreement or made any commitment to do
any of the foregoing.
SECTION 5.9. Tax Matters. Except as set forth on Schedule
5.9.:
(a) all Tax Returns that are required to be filed (taking
into account all extensions) on or before the Closing Date for, by, on behalf
of or with respect to any of the Companies, including those relating to their
business activities and assets, and those which include or should include any
of the Companies, their business activities or their assets have been or will
be timely filed with the appropriate federal, state, and local authorities on
or before the Closing Date, and all Taxes shown to be due and payable on
those Tax Returns or related to those Tax Returns have been or will be timely
paid in full on or before the Closing Date;
(b) all of the Tax Returns and the information and data
contained therein have been or will be properly and accurately compiled and
completed, fairly present or will fairly present the information purported to
be shown therein, and reflect or will reflect all liabilities for Taxes for
the periods covered by those Tax Returns;
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(c) none of the Tax Returns are now under audit or
examination by any foreign, federal, state, provincial or local authority,
and there are no agreements, waivers or other arrangements providing for an
extension of time with respect to the assessment or collection of any Tax or
deficiency of any nature against any Company, their business activities or
assets, or with respect to any of the Tax Returns, or any suits or other
actions, proceedings, investigations or claims now pending or threatened
against any Company, their business activities or their assets with respect
to any Tax, or any matters under discussion with any Governmental Entity
relating to any Tax, or any claims for any additional Tax asserted by any
Governmental Entity;
(d) all Taxes (including, without limitation, any Taxes
resulting from the purchase of stock or any other assets by any Company,
whether pursuant to the Grupo Nicna Reorganization or otherwise) due and
owing from any Company or assessed and due and owing against their business
activities or assets on or before the Closing Date have been or will be
timely paid in full on or before the Closing Date;
(e) all withholding Tax and Tax deposit requirements imposed
on any Company and applicable to its business for any and all periods prior to
and including the Closing Date have been or will be timely satisfied in full
on or before the Closing Date; and
(f) each Company has made adequate provision for the payment
in full of any and all unpaid Taxes (including, without limitation, any Taxes
resulting from the purchase of stock or any other assets by any Company,
whether pursuant to the Grupo Nicna Reorganization or otherwise) which in any
way may affect their assets or business activities for any and all periods or
portions thereof ending on or before the respective dates thereof and such
provision will be reflected on the Estimated Closing Balance Sheet and the
Closing Balance Sheet.
SECTION 5.10. Absence of Undisclosed Liabilities. Except as
set forth on Schedule 5.10, none of the Companies has any indebtedness or
liability, whether absolute or contingent, known or unknown, which is not
shown or provided for on the June 30 2004 Balance Sheet other than
liabilities as shall have been incurred or accrued in the ordinary course of
business since June 30, 2004. Except as shown in the June 30, 2004 Balance
Sheet or on Schedule 5.10, none of the Companies is directly or indirectly
liable upon or with respect to (by discount, repurchase agreements or
otherwise), or obligated in any other way to provide funds in respect of, or
to guarantee or assume, any debt, obligation or dividend of any Person,
except endorsements in the ordinary course of business in connection with the
deposit, in banks or other financial institutions, of items for collection.
SECTION 5.11. Owned Real Property. None of the Companies
owns any real property. None of the Companies has been granted a real property
purchase option by any Person.
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SECTION 5.12. Leases.
(a) Schedule 5.12(a) sets forth a list of all leases,
licenses, permits, subleases and occupancy agreements, together with all
amendments and supplements thereto, with respect to all properties in which
any Company has a leasehold interest, whether as lessor or lessee (each, a
"Lease" and collectively, the "Leases"; the property covered by Leases under
which a Company is a lessee is referred to herein as the "Leased Real
Property"). The Seller has furnished true, complete and accurate copies of
all Leases to the Buyer or its representatives. No option has been exercised
under any of such Leases, except options whose exercise has been evidenced by
a written document, a true, complete and accurate copy of which has been
delivered to the Buyer or its representatives with the corresponding Lease.
Except as set forth on Schedule 5.12(a), the transactions contemplated by this
Agreement do not require the consent or approval of the other party to any
Lease, nor will such transactions violate any Lease or cause any Company to be
in default under any Lease.
(b) Each Lease is in full force and effect and no Lease has
been modified or amended except pursuant to an amendment referred to on
Schedule 5.12(a). Neither the Company party to any Lease nor any other party
to a Lease has given to the other party written notice of or has made a claim
with respect to any breach or default. None of the Companies is in default
under any Lease and, to the best knowledge of the Seller, either Seller Party
or any Company, no other party to a Lease is in default.
(c) None of the Leased Real Property is subject to any
sublease, license or other agreement granting to any Person any right to the
use, occupancy or enjoyment of such property or any portion thereof. No
Company has received any notice from any utility company or municipality of
any fact or condition which could result in the discontinuation of presently
available or otherwise necessary sewer, water, electric, gas, telephone or
other utilities or services for any of the Leased Real Property. The Leased
Real Property, all improvements thereon and thereto, and the operations
therein conducted conform to all applicable health, fire, insurance,
environmental, safety, zoning and building laws, ordinances and
administrative regulations, Licenses and Permits and other regulations,
except for possible nonconforming uses or violations that do not and will not
interfere with the present use, operation or maintenance thereof by any
Company as now used, operated or maintained or access thereto, and that do
not and will not affect the value thereof, and none of the Companies has
received any notice to the contrary.
(d) Except as set forth in Schedule 5.12(d), the plumbing,
electrical, heating, air conditioning, elevator, ventilating and all other
mechanical or structural systems for which any Company is responsible under
the Leases in the buildings or improvements for the Companies' offices
located at Xxxxxxx Xxx Xxxxxxx 0000, Xxxxxxxx, Xxxxxxxxx, Nuevo Xxxx, are in
good working order and condition, and the roof, basement and foundation walls
of such buildings and improvements for which any Company is responsible under
the Leases are in good condition and free of leaks and other defects. Except
as set forth in Schedule 5.12(d), all such mechanical and structural systems
and such roofs, basement and foundation walls for which others are
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responsible under said Leases are in good working order and condition and
free of leaks and other defects. There are no other physical defects or
deferred maintenance items at any Leased Real Property that interfere with or
impede the Companies' use of such properties in the ordinary course of its
business or that any Company is obligated under any of the Leases to repair
or otherwise correct.
(e) Except as set forth on Schedule 5.12(e), there are no
guaranties (from the Seller or from other Persons) in favor of the lessors of
any of the Leased Real Property.
(f) No Company has sold, assigned, transferred, pledged or
encumbered all or any part of its leasehold interests in the Leased Real
Property.
(g) Access from public streets and provision for parking and
loading/unloading at any Leased Real Property conforms to all applicable
legal requirements and is adequate for the conduct of the business of the
Companies in the normal course.
(h) To the best knowledge of the Seller, either Seller Party
or any Company, none of the Leased Real Property is subject to a fee mortgage,
deed of trust, other security interest or similar encumbrance, nor to a
ground lease or underlying lease.
(i) Except as set forth on Schedule 5.12, there is no
pending, or to the best knowledge of the Seller, either Seller Party or any
Company, threatened: (i) condemnation of any part of the Leased Real Property
by any Governmental Entity; (ii) special assessment against any part of the
Leased Real Property; or (iii) litigation against any Niples Company, any
Company or any lessor for breach of any restrictive covenant affecting any
part of the Leased Real Property.
SECTION 5.13. Assets of the Companies.
(a) The assets, properties and rights of each Company
constitute all of the assets and rights which are used in the operation of
the businesses of such Company immediately prior to the Closing and which are
necessary or required for the conduct of such businesses as currently
conducted. The assets accounted for on the June 30, 2004 Balance Sheet are
owned by the Companies as of the date hereof, except for assets transferred
in the ordinary course of business of (i) the Niples Companies prior to the
Grupo Nicna Reorganization or (ii) the Companies thereafter. Other than the
assets listed on Schedule 5.13(a), which assets are not used in the
Transferred Business, there are no assets, properties, rights or interests of
any kind or nature that any Company has been using, holding or operating in
its businesses prior to the Closing that will not be used, held or owned by
such Company immediately following the Closing.
(b) Each Company has good and marketable title, free and
clear of any Liens, to, or a valid leasehold interest under enforceable leases
in, all of the assets, properties and rights of such Company except, in the
case of Leased Real Property, Liens arising as a result of actions or inactions
of the lessor or owner of such properties unrelated to any default by any of
the Companies or any of the Niples Companies.
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(c) Schedule 5.13(c) sets forth a complete and correct list
and brief description of each item of Equipment and Machinery having an
original purchase cost or aggregate lease cost exceeding $15,000. The
Equipment and Machinery are in good operating condition and repair, ordinary
wear and tear excepted.
SECTION 5.14. Intellectual Property; Intangible Assets.
(a) Schedule 5.14 sets forth a complete and correct listing
of the Intellectual Property. Each Company owns, or has a license or
otherwise has the right to use, in all jurisdictions in which it carries on
business, all Intellectual Property without violating the rights of others.
Except as set forth on Schedule 5.14, all Intellectual Property is owned by
the Companies, free and clear of all Liens. There has not been communicated
to any Company the threat of any claim that the holder of such Intellectual
Property is in violation or infringement of any service xxxx, patent,
trademark, trade name, trademark or trade name registration, copyright or
copyright registration of any other Person. The consummation of the
transactions contemplated by this Agreement will not prohibit any Company
from using any of the Intellectual Property in a manner substantially similar
to its current use of such Intellectual Property in its business.
(b) Schedule 5.14 sets forth a true and complete list of all
of the Intangible Assets and a summary description of each such item. There is
no restriction affecting the use of any of the Intangible Assets, and no
license has been granted with respect thereto. Each of the Intangible Assets
is valid and in good standing, is not currently being challenged, is not
involved in any pending or to the best knowledge of the Companies, the Seller
or the Seller Parties, threatened administrative or judicial proceeding, and
to the best knowledge of the Companies, the Seller and the Seller Parties,
does not conflict with any rights of any other Person. The Companies' rights
in and to the Intangible Assets are sufficient and adequate in all respects
to permit the conduct of the businesses of the Companies as now conducted.
To the best knowledge of the Seller, either Seller Party or any Company, none
of the products or operations of the businesses of any Company involves any
infringement of any proprietary right of any other Person.
SECTION 5.15. Licenses and Permits. Schedule 5.15 sets forth
a true and complete list of all licenses, permits, franchises, authorizations
and approvals issued or granted to any Company by any Governmental Entity
(the "Licenses and Permits"), and all pending applications therefor. Except
as set forth on Schedule 5.15, each License and Permit has been duly
obtained, is valid and in full force and effect, and is not subject to any
pending or to the best knowledge of the Sellers, either Seller Party or any
Company threatened administrative or judicial proceeding to revoke, cancel,
suspend or declare such License and Permit invalid in any respect. The
Licenses and Permits are sufficient and adequate in all respects to permit
the continued lawful conduct of the business of each Company in the manner
now conducted and none of the operations of any Company are being conducted
in a manner that violates any of the terms or conditions under which any of
the Licenses and Permits was granted. The consummation of the transactions
contemplated by this Agreement and the other Transaction Documents will not
result in the termination or suspension of any of the Licenses and Permits.
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SECTION 5.16. Compliance with Law. The operations of the
businesses of Grupo Nicna and the Companies have been conducted in accordance
with all applicable laws, regulations, orders and other requirements of all
courts and other Governmental Entities having jurisdiction over Grupo Nicna
or the Companies, as the case may be, and their assets, properties and
operations. None of the Niples Companies or any of the Companies has
received notice of any violation of any such law, regulation, order or other
legal requirement, and is not in default with respect to any order, writ,
judgment, award, injunction or decree of any national, state or local court
or Governmental Entities or arbitrator, domestic or foreign, applicable to
any of the Niples Companies or any of the Companies, as the case may be, or
any of their assets, properties or operations.
SECTION 5.17. Litigation. Except as set forth on Schedule
5.17, there are no claims, actions, suits, proceedings, labor disputes or
investigations pending or, to the best knowledge of the Seller, either Seller
Party or any Company, threatened, before any national, state or local court
or Governmental Entity, or before any arbitrator of any nature, brought by or
against any Niples Company, any Company or any of their officers, directors,
employees, agents or Affiliates involving, affecting or relating to any
Niples Company or any Company, its assets, properties or rights or the
transactions contemplated by this Agreement, nor is any basis known to the
Seller, either Seller Party or any Company for any such action, suit,
proceeding or investigation. Schedule 5.17 sets forth a list and a summary
description of all such pending actions, suits, proceedings, disputes or
investigations. None of the Niples Companies or the Companies nor their
assets, properties or rights is subject to any order, writ, judgment, award,
injunction or decree of any national, state or local court or Governmental
Entity or arbitrator, domestic or foreign, that affects or might affect the
business, assets, properties or rights of any Company, or that would or might
interfere with the transactions contemplated by this Agreement.
SECTION 5.18. Contracts.
(a) Schedule 5.18(a) sets forth, for each Contract (as in
effect on the date hereof) its date, the name of the parties thereto, the
subject matter thereof and, in the case of any oral Contract, a summary
description thereof.
(b) Each Contract is valid, binding and enforceable against
the parties thereto in accordance with its terms, and in full force and effect
on the date hereof. Each Company and each Niples Company has performed all
obligations required to be performed by it to date under, and is not in
default or delinquent in performance, status or any other respect (claimed or
actual) in connection with, any Contract, and no event has occurred which,
with due notice or lapse of time or both, would constitute such a default by
such Company. To the best knowledge of the Seller, either Seller Party or
any Company, no other party to any Contract is in default in respect thereof,
and no event has occurred which, with due notice or lapse of time or both,
would constitute such a default. Other than employment agreements, the
Seller has delivered to the Buyer or its representatives true, complete and
accurate originals or copies of all the Contracts. The consummation of the
transactions contemplated by this Agreement and all other Transaction
Documents will not result in the acceleration of any obligation of any of the
Companies under, or in the termination of, any Contract.
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(c) Schedule 5.18(c) sets forth a true and complete list of
the powers of attorney granted with respect to the affairs of any of the
Companies.
SECTION 5.19. Inventories.
(a) All the raw material, work-in-process and finished goods
inventory owned by any Company (the "Inventory") is listed on Schedule
5.19(a). Except as set forth on Schedule 5.19(a), (i) all the Inventory is
of good and merchantable quality, free from defects and can be sold at
customary margins in the ordinary course of business and (ii) none of the
Inventory is obsolete, surplus, slow moving, damaged or consists of goods
returned or rejected by the Companies' customers (or, prior to the Grupo
Nicna Reorganization, the Niples Companies' customers). For purposes of this
Section 5.19, "slow moving" Inventory shall mean any items of Inventory for
which the Company has more than four month supply in the preceding twelve
months.
(b) Except as set forth on Schedule 5.19(b), none of the
Inventory is stored with a bailee, warehouseman or similar party and all the
Inventory is located at the locations identified on Schedule 5.19(b).
SECTION 5.20. Employee Plans. Except as set forth on
Schedule 5.20, none of the Companies maintains or contributes to, or has in
the past maintained or contributed to, any employee benefit plan, whether
directly or indirectly, except for those required by Law. Each Company is in
compliance with the payment of annual profit sharing and contributions on
account of any Social Security (Seguro Social), Employee Housing Fund Quota
(Instituto del Fondo Nacional de la Vivienda para los Trabajadores) and
Retirement Fund (Sistema de Ahorro para el Retiro) applicable to its respective
employees.
SECTION 5.21. Customers and Suppliers. Schedule 5.21 sets
forth a complete and correct list of: (a) all customers whose purchases from
the Niples Companies exceeded 1% of the net sales of the Niples Companies
during the first nine months of 2004; (b) the twenty five (25) largest
customers by dollar volume in each of Mexico and the United States of America
and the aggregate dollar volume of purchases (broken down by principal
categories) of the Niples Companies during the first nine months of 2004; (c)
the twenty (20) largest suppliers by dollar volume of the Niples Companies and
the aggregate dollar volume of purchases (broken down by principal categories)
by the Niples Companies from such suppliers during the first nine months of
2004; (d) all distributors of any products of any Niples Company; and (e) all
sales representatives of the Niples Companies. All such customers,
suppliers, distributors and sales representatives have become customers,
suppliers, distributors or sales representatives, as the case may be, of the
Companies and none of such customers, suppliers, distributors or sales
representatives has or, to best knowledge of the Seller, either Seller Party
or any Company, intends to terminate or change significantly its relationship
with any of the Companies.
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SECTION 5.22. Insurance. Schedule 5.22 lists the fidelity
bonds and the aggregate coverage amount and type and generally applicable
deductibles of all policies of title, liability, fire, casualty, business
interruption, workers' compensation and other forms of insurance insuring
each Company and its assets, properties and operations. The Seller has
furnished a true, complete and accurate copy of all such policies and bonds
the Buyer or its representatives. All such policies and bonds are in full
force and effect, underwritten by financially sound and reputable insurers
and sufficient for all applicable requirements of law and will not in any way
be affected by or terminated or lapsed by reason of the consummation of the
transactions contemplated by this Agreement. None of the Companies is in
default under any provisions of any such policy of insurance nor has any
Company received notice of cancellation of any such insurance. There is no
claim by any Niples Company or any Company pending under any of any insurance
policies or bonds as to which coverage has been questioned, denied or
disputed by the underwriters of such policies or bonds. The insurance
maintained by each Company in connection with its business is adequate in
accordance with industry standards, the requirements of any applicable Leases
and is in at least the minimum amount required by currently applicable
environmental regulations.
SECTION 5.23. Transactions with Directors, Officers and
Affiliates. Except as set forth on Schedule 5.23, none of the Companies is a
party to any agreement or arrangement with any of the directors, officers or
shareholders of any Company, either Seller Party or any Affiliate or family
member of any of the foregoing under which it: (i) leases any real or
personal property (either to or from such Person), (ii) licenses technology
(either to or from such Person), (iii) is obligated to purchase any tangible
or intangible asset from or sell such asset to such Person, (iv) purchases
products or services from such Person, (v) pays or receives commissions,
rebates or other payments or (vi) provides or receives any other material
benefit. None of the Companies employs as an employee or engages as a
consultant any family member of any of the directors, officers or
stockholders of any Company. Except as set forth on Schedule 5.23, to the best
knowledge of the Seller, either Seller Party or any Company, during the
past three years none of the directors, officers or stockholders of any
Company, or any family member of any of such Persons, has been a director or
officer of, or has had any direct or indirect interest in, any Person which
during such period has been a supplier, customer, distributor or sales agent
of such Company or any Niples Company or has competed with or been engaged in
any business of the kind being conducted by such Company or any Niples
Company. No Affiliate of any Company owns or has any rights in or to any of
the assets, properties or rights used by such Company in the ordinary course
of its businesses.
SECTION 5.24. Change in Ownership. The consummation of the
transactions contemplated by this Agreement will not result in any material
adverse change in the businesses of any Company or, to the best knowledge of
the Seller, either Seller Party or any Company, in the loss of the benefits
of any material relationship with any customer or supplier.
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SECTION 5.25. Receivables and Payables. Schedule 5.25 sets
forth a list of all notes and accounts receivable (including the aging
thereof) and accounts payable of the Transferred Business as of November 30,
2004. All notes and accounts receivable payable to or for the benefit of any
Company and reflected on the Closing Balance Sheet have been collected or are
(or will be) collectible in amounts not less than the aggregate amount
thereof (net of reserves established in accordance with prior practice and
included in the computation of the Closing Balance Sheet), and to the best
knowledge of the Seller, either Seller Party or any Company, are not subject
to any counterclaims or set-offs.
SECTION 5.26. Labor Matters.
(a) Schedule 5.26(a) contains a list of all employees currently
employed by any Company and, except as set forth thereon, there are no other
workers or employees rendering services to any of the Companies.
(b) (i) Each Company is in compliance with all applicable
laws, regulations and orders relating to employment and employment practices,
including wages, hours, employee health and safety conditions and terms and
conditions of employment, social security contributions, compulsory insurance
contributions and rules governing protection of privacy; (ii) no Company is a
party to any outstanding employment, consulting or management agreement or
contract with officers or employees that is not terminable at will (unless
and in so far as the inability to terminate is expressly required by
mandatory provisions of law or collective bargaining agreement governing any
said agreement or contract) or that provide for the payment of any indemnity,
bonus or commission (other than any such payment under law or a collective
bargaining agreement); (iii) no Company is a party to any agreement, policy
or practice that requires it to pay termination or severance pay to salaried,
non-exempt or hourly employees unless and in so far as such pay is expressly
required by mandatory provisions of the law or collective bargaining
agreement governing any said agreement, policy or practice; (iv) except as
set forth on Schedule 5.26(b), no Company is a party to any collective
bargaining agreement or other labor union contract applicable to individuals
employed by any such Company; and (v) Seller and each Company has given all
notices required by any law, ordinance or regulation regarding facility
closings, layoffs, change in control, employment, employment practices and
employee health and safety to government officials, employees, labor
organizations, work councils and other employee representatives. The Seller
has furnished to the Buyer or its representatives complete and correct copies
of all such agreements. No Company has breached or otherwise failed to
comply with any provision of any labor agreement and each Company is in full
compliance with all terms of any individual or collective bargaining
agreement and there are no grievances outstanding thereunder.
(c) Except as set forth on Schedule 5.26(c), (i) none of the
Companies has engaged in any unfair labor practice and no complaint,
representation claim or petition is pending before any authority or court in
respect of any alleged unfair labor practice; (ii) no labor strike, slowdown
or work stoppage or lockout is actually pending or threatened against or
affecting any Company, and no Company has at any time experienced any strike,
slowdown or work stoppage, lockout or other collective labor action by or
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with respect to its employees; and (iii) no Company has received notice from
any agency, authority or court responsible for the enforcement of labor laws
of an intention to conduct an investigation of any Company and no such
investigation is in progress.
SECTION 5.27. Environmental Matters. Except as set forth on
Schedule 5.27:
(a) The operations of each Niples Company and each Company
is, and has been conducted in compliance with all applicable Environmental
Laws and permits issued thereunder.
(b) None of the Companies, the Sellers or the Seller Parties
reasonably expect that expenditures are or will be necessary for the
Companies to maintain full compliance with Environmental Laws currently in
effect or proposed or anticipated to be adopted.
(c) Each Niples Company and each Company has obtained, or has
made timely and complete application for or for renewal of, all Licenses and
Permits required under Environmental Laws for the operation of their
business.
(d) No Niples Company and no Company has received notice of,
nor is there pending or threatened against any Niples Company or any Company,
any claim, investigation, order, decree or lawsuit pursuant to any
Environmental Law arising out of the operation of the their business
("Environmental Claim").
(e) No Niples Company and no Company has entered into an
agreement to assume any liability of or to indemnify any other Person for
any claim, damage or loss arising out of the use, treatment, storage or
disposal of any Hazardous Substance regulated under applicable Environmental
Law.
(f) The Seller has provided the Buyer or its representatives
with copies of all (i) Licenses and Permits held by any Niples Company or any
Company pursuant to Environmental Law, (ii) notices, demands, claims or
actions against any Niples Company or any Company pursuant to Environmental
Law, and (iii) reports, data or other documentation related to all
investigations, audits or assessments of environmental conditions at property
owned, leased or used by any Niples Company or any Company and such Person's
compliance with Environmental Law.
SECTION 5.28. Products Liability. (i) There is no
notice, demand, claim, action, suit, inquiry, hearing, proceeding, notice of
violation or investigation of a civil, criminal or administrative nature
before any court or Governmental Entity against or involving any products
manufactured, produced, distributed or sold by or on behalf of any Niples
Company or any Company (including any parts or components) (collectively,
"Products"), or class of claims or lawsuits involving the same or similar
Product which is pending or threatened, resulting from an alleged defect in
design, manufacture, materials or workmanship of any Product, or any alleged
failure to warn, or from any breach of implied warranties or representations
(collectively, "Product Liability Lawsuits"); (ii) to the best knowledge of
the Seller, either Seller Party or any Company, there has not been any
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Occurrence (as hereinafter defined); and (iii) there has not been, nor is
there under consideration or investigation by any Niples Company or any
Company, any Product rework or retrofit (collectively, "Retrofits") conducted
by or on behalf of any Niples Company or any Company.
For purposes of this Section 5.28, the term "Occurrence" shall
mean any accident, happening or event which takes place at any time which is
caused or allegedly caused by any alleged hazard or alleged defect in
manufacture, design, materials or workmanship including, without limitation,
any alleged failure to warn or any breach of express or implied warranties or
representations with respect to, or any such accident, happening or event
otherwise involving any Product that is likely to result in a claim or loss.
SECTION 5.29. Grupo Nicna Reorganization. The asset
transfers by the Niples Companies to the Companies and the other transactions
described on Exhibit A hereto have been completed in accordance with the terms
of Exhibit A hereto. Without limiting the generality of the foregoing, (i)
except for those assets set forth on Schedule 5.29, all of the properties,
assets and rights (including, without limitation, Equipment and Machinery,
Contracts, Intellectual Property and Intangible Assets) of the Niples
Companies have been transferred to the Companies and are owned, on the date
hereof, by the Companies, (ii) the Grupo Nicna Reorganization did not and
does not violate or conflict with any provision of the Certificate or
Articles of Incorporation or By-laws (or equivalent documents) of Grupo
Xxxxxx or any of its Subsidiaries and did not and does not violate any
provision of law, or any order, judgment or decree of any court or
Governmental Entity, nor violate nor result in a breach of or constitute
(with due notice or lapse of time or both) a default under any contract,
lease, loan agreement, mortgage, security agreement, trust indenture or other
agreement or instrument to which Grupo Xxxxxx or any of its Subsidiaries is a
party or by which Grupo Xxxxxx or any of its Subsidiaries is bound or to
which any of such properties or assets is subject, nor did the Grupo Nicna
Reorganization result in the imposition of any Lien upon any such assets,
properties or rights of any Company, nor result in the cancellation,
modification, revocation or suspension of any of the Licenses and Permits,
and (iii) each consent, waiver, authorization or approval of any Governmental
Entity, or of any other Person, required in connection with the Grupo Nicna
Reorganization has been obtained and each declaration to or filing or
registration with any such Governmental Entity that was required in
connection with the Grupo Nicna Reorganization has been made.
SECTION 5.30. Accuracy of Information. None of the
representations, warranties or statements of the Seller or the Seller Parties
contained in this Agreement, or in the exhibits hereto, contains any untrue
statement of a material fact or omits to state any material fact necessary in
order to make any of such representations, warranties or statements in light
of the circumstances under which they were made not misleading. All
information relating to Grupo Xxxxxx, any of its Subsidiaries or any Company
and their respective businesses that is known to the Seller, either Seller
Party or any Company and that may be material to a purchaser for value of any
Company has been disclosed in writing to the Buyer.
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SECTION 5.31. Incorporation by Reference. The Seller and the
Seller Parties hereby incorporate by reference and make to the Buyer the
representations and warranties made by the sellers under the Inventory
Purchase Agreement and the Southland Purchase Agreement.
SECTION 6. ADDITIONAL REPRESENTATIONS AND WARRANTIES OF THE SELLER
AND THE SELLER PARTIES.
Each Seller and each Seller Party hereby jointly and severally
represent and warrant to the Buyer as follows:
SECTION 6.1. Corporate Organization.
(a) Miyar is a limited liability company duly organized,
validly existing and in good standing under the laws of the State of Delaware
and has all requisite power and authority to own its properties and assets
and to conduct its businesses as now conducted.
(b) Nicna is a limited liability company duly organized,
validly existing and in good standing under the laws of Switzerland and has
all requisite power and authority to own its properties and assets and to
conduct its businesses as now conducted.
SECTION 6.2. Qualification to Do Business. Each Seller is
duly qualified to do business as a foreign corporation and is in good standing
in every jurisdiction in which the character of the properties owned or leased
by it or the nature of the business conducted by it makes such qualification
necessary.
SECTION 6.3. Title to the Common Shares. Each Seller has,
and will have at the Closing, record and beneficial ownership to the number of
Shares set forth across from its name on Schedule 5.5, free and clear of any
Liens, other than transfer restrictions, if any, resulting from federal,
state or international securities laws.
SECTION 6.4. Authorization and Validity of Agreement. Each
Seller and each Seller Party has the requisite power and authority to enter
into this Agreement and the other Transaction Documents to which it is a
party and to carry out his obligations hereunder and thereunder. The
execution and delivery by each Seller of this Agreement and the other
Transaction Documents to which it is a party and the performance of its
obligations hereunder and thereunder have been duly authorized by all
necessary corporate action by the Board of Directors (or other governing
body) of each Seller, and no other corporate proceedings on the part of such
Seller are necessary to authorize such execution delivery and performance.
This Agreement and the other Transaction Documents to which each Seller or
Seller Party is a party have been duly executed by such Seller or Seller
Party and constitute such Seller's or Seller Party's valid and binding
obligations, enforceable against such Seller or Seller Party in accordance
with its terms, except as enforceability may be limited by bankruptcy,
insolvency, reorganization, moratorium and other laws of general
applicability relating to or affecting creditors' rights or by general
principals of equity.
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SECTION 6.5. No Conflict or Violation. The execution,
delivery and performance by each Seller and each Seller Party of this Agreement
and the other Transaction Documents to which it is a party, (i) in the case of
each Seller, do not and will not violate or conflict with any provision of
the Certificate of Incorporation or By-Laws (or equivalent documents) of such
Seller and (ii) do not and will not violate any provision of law, or any
order, judgment or decree of any court or Governmental Entity nor violate nor
will result in a breach of or constitute (with due notice or lapse of time or
both) a default under any contract, lease, loan agreement, mortgage, security
agreement, trust indenture or other agreement or instrument to which the
Seller or any Seller Party is a party or by which he is bound or to which any
of its properties or assets is subject.
SECTION 7. REPRESENTATIONS AND WARRANTIES OF THE BUYER.
Xxxxxxx Comercial hereby represents and warrants to the Seller as
follows:
SECTION 7.1. Corporate Organization. Each Buyer is a
corporation duly organized, validly existing and in good standing under the
laws of its state of incorporation, and has all requisite corporate power and
authority to own its properties and assets and to conduct its businesses as
now conducted.
SECTION 7.2. Qualification to Do Business. Each Buyer is
duly qualified to do business as a foreign corporation and is in good standing
in every jurisdiction in which the character of the properties owned or leased
by it or the nature of the business conducted by it makes such qualification
necessary.
SECTION 7.3. Authorization and Validity of Agreement. Each
Buyer has all requisite corporate power and authority to enter into this
Agreement and the other Transaction Documents to which it is a party and to
carry out its obligations hereunder and thereunder. The execution and
delivery by each Buyer of this Agreement and the other Transaction Documents
to which such Buyer is a party and the performance by such Buyer of its
obligations hereunder and thereunder have been duly authorized by all
necessary corporate action by the Board of Directors (or other governing
body) of such Buyer and no other corporate proceedings on the part of either
Buyer are necessary to authorize such execution, delivery and performance.
This Agreement and the other Transaction Documents to which each Buyer is a
party have been duly executed by such Buyer and constitute such Buyer's valid
and binding obligations, enforceable against such Buyer in accordance with
their terms, except as enforceability may be limited by bankruptcy,
insolvency, reorganization, moratorium and other laws of general
applicability relating to or affecting creditors' rights or by general
principles of equity.
SECTION 7.4. No Conflict or Violation. The execution,
delivery and performance by each Buyer of this Agreement and the other
Transaction Documents to which such Buyer is a party do not and will not
violate or conflict with any provision of the Certificate of Incorporation or
By-laws (or equivalent documents) of such Buyer and do not and will not
violate any provision of law, or any order, judgment or decree of any court or
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Governmental Entity, nor violate nor will result in a breach of or constitute
(with due notice or lapse of time or both) a default under any contract,
lease, loan agreement, mortgage, security agreement, trust indenture or other
agreement or instrument to which such Buyer is a party or by which it is
bound or to which any of its properties or assets is subject.
SECTION 7.5. Consents and Approvals. The execution, delivery
and performance of this Agreement and the other Transaction Documents by each
Buyer does not require the consent or approval of, or filing with, any
Governmental Entity or Person, except for such consents, approvals and
filings of which the failure to obtain or make would not, individually or in
the aggregate, have a material adverse effect on the ability of such Buyer to
consummate the transactions contemplated hereby.
SECTION 8. COVENANTS OF THE SELLER AND THE SELLER PARTIES.
The Seller and each Seller Party hereby jointly and severally
covenant as follows:
SECTION 8.1. Consents and Approvals. The Seller shall, at
the cost and expense of the Seller, (a) use its commercially reasonable
efforts to obtain all necessary consents, waivers, authorizations and
approvals of all Governmental Entities, and of all other Persons, required in
connection with the execution, delivery and performance by the Seller of this
Agreement and the other Transaction Documents, and (b) diligently assist and
cooperate with the Buyer in preparing and filing all documents required to be
submitted by the Buyer to any Governmental Entities, in connection with such
transactions and in obtaining any governmental consents, waivers,
authorizations or approvals which may be required to be obtained by the Buyer
in connection with such transactions (which assistance and cooperation shall
include, without limitation, timely furnishing to the Buyer all information
concerning the Companies, the Seller or the Seller Parties that counsel to
the Buyer reasonably determines is required to be included in such documents
or would be helpful in obtaining any such required consent, waiver,
authorization or approval).
SECTION 8.2. Access to Properties and Records. The Seller
shall cause the Niples Companies to afford to the Buyer, and to the
accountants, counsel and representatives of the Buyer ("Representatives"),
full access during normal business hours to all properties, books, Contracts,
commitments and files and records (including, but not limited to, Tax Returns
and correspondence with accountants) of the Niples Companies and, during the
Representative' review, shall furnish promptly to the Buyer all other
information concerning the Grupo Nicna Reorganization and the Niples
Companies as the Buyer may reasonably request, provided that no investigation
or receipt of information pursuant to this Section 8.2 shall qualify any
representation or warranty of the Seller or the Seller Parties or the
conditions to the obligations of the Buyer.
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SECTION 8.3. Best Efforts. Upon the terms and subject to the
conditions of this Agreement, each Seller Party and the Seller will use and
will cause the Niples Companies to use, their best efforts to take, or cause
to be taken, all action, and to do, or cause to be done, all things
necessary, proper or advisable consistent with applicable law to consummate
and make effective in the most expeditious manner practicable any
transactions contemplated hereby, by the other Transaction Documents or by
the Grupo Nicna Reorganization which are not consummated on or prior to the
date hereof.
SECTION 8.4. Covenant Not To Compete.
(a) The Seller shall not and shall cause its Affiliates
(including the Niples Companies) not to, for a period of five years after the
Closing Date, engage or participate, directly or indirectly, in the business
or businesses which are engaged in by any Company immediately prior to the
Closing in any geographical area where such business or businesses are
engaged in by such Company immediately prior to the Closing.
(b) Each Seller Party and the Seller agrees that a monetary
remedy for a breach of the agreement set forth in Section 8.4(a) hereof will
be inadequate and impracticable and further agrees that such a breach would
cause the Buyer irreparable harm, and that the Buyer shall be entitled to
temporary and permanent injunctive relief without the necessity of proving
actual damages. In the event of such a breach, each Seller Party and the
Seller agrees that the Buyer shall be entitled to such injunctive relief,
including temporary restraining orders, preliminary injunctions and permanent
injunctions as a court of competent jurisdiction shall determine.
(c) If any provision of this Section 8.4 is invalid in part,
it shall be curtailed, both as to time and location, to the minimum extent
required for its validity under the laws of the United States and shall be
binding and enforceable as so curtailed.
SECTION 8.5. Non-Solicitation of Employees. The Seller shall
not, and shall cause its Affiliates (including the Niples Companies) not to,
for the five-year period commencing on the Closing Date, make, offer, solicit
or induce to enter into, any written or oral arrangement, agreement or
understanding regarding employment or retention as a consultant with any
Person who was, on the date hereof, a full-time employee of any Company.
SECTION 8.6. Liquid Assets. From and after the date hereof
and until April 30, 2007, the Seller shall, and the Seller Parties shall cause
the Seller to (i) own and hold no less than $10,000,000 in cash, current
marketable securities or other liquid assets (collectively, "Liquid Assets")
and (ii) within 15 days after the end of every other calendar quarter
commencing with the calendar quarter ending on March 31, 2005, deliver to the
Buyer (x) a certificate of a financial officer of the Seller or, if the
Seller does not have a financial officer, an authorized representative of the
Seller, certifying that the Seller is in compliance with clause (i) above and
(y) one or more certificates, in form and substance reasonably satisfactory
to the Buyer, of an authorized representative of the bank(s) or other
financial institution(s) where such liquid assets are held certifying that
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the balance on the Seller's account(s) with such bank(s) or other financial
institution(s) is no less than $10,000,000, in the aggregate. Without
limiting any other rights or remedies of the Buyer under this Agreement, if
at any time prior to April 30, 2007 the Seller no longer holds $10,000,000 in
Liquid Assets, the Seller Parties shall immediately make available to the
Seller, through equity contributions or loans, Liquid Assets in an amount
sufficient to assure that the Seller is in compliance with clause (i) above.
SECTION 9. TAXES.
SECTION 9.1. Pre-Closing Taxes. The Seller shall promptly
reimburse the Buyer for any Taxes of any Company (including without
limitation any Taxes due as a result of the purchase of stock or any other
assets by any Company, whether pursuant to the Grupo Nicna Reorganization or
otherwise) for any and all periods or portions thereof ending on or before
the Closing Date, if adequate provision for such payment, as reflected on the
Estimated Closing Balance Sheet or, after completion of the post-closing
adjustment described in Section 3.3, the Closing Balance Sheet, was not made.
SECTION 9.2. Cooperation on Tax Matters. (a) The Buyer and
the Seller shall cooperate fully, as and to the extent reasonably requested by
the other parties, in connection with the filing of all Tax Returns by the
Companies and any audit, litigation or other proceeding with respect to
Taxes. Such cooperation shall include the retention and (upon the other
party's request) the provision of records and information which are
reasonably relevant to any such audit, litigation or other proceeding and
making employees available on a mutually convenient basis to provide
additional information and explanation of any material provided hereunder.
(b) The Buyer and the Seller further agree, upon request, to
use commercially reasonable efforts to obtain any certificate or other
document from any Governmental Entity or any other Person as may be necessary
to mitigate, reduce or eliminate any Tax that could be imposed (including,
but not limited to, with respect to the transactions contemplated hereby).
SECTION 9.3. Certain Taxes. Any transfer, documentary,
sales, use, stamp, registration and other Taxes and fees (including any
penalties and interest) imposed by any Governmental Entity upon any of the
companies in connection with this Agreement shall be paid by the Seller when
due, and the Seller will, at its own expense, file all necessary Tax Returns
and other documentation with respect to any such applicable transfer,
documentary, sales, use, stamp, registration and other Taxes and fees, and, if
required by applicable law, the Buyer will, and will cause its Affiliates to,
join in the execution of any such Tax Returns and other documentation.
SECTION 10. INDEMNIFICATION.
SECTION 10.1. Survival. Each of the representations and
warranties set forth in this Agreement shall survive the Closing; provided,
however, that no claim, lawsuit or other proceeding arising out of or related
to the breach of any representation or warranty contained in this Agreement
(other than Sections 5.5, 5.9, 5.20, 5.27, 5.29 and 6.1) may be made by any
Indemnitee unless notice of such claim, lawsuit or other proceeding, is given
to the Indemnitor in accordance with Section 10.4 on or prior to April 30,
2007.
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SECTION 10.2. Indemnification by the Seller and the Seller
Parties. (a) Notwithstanding the Closing and regardless of any investigation
at any time made by or on behalf of the Buyer or of any knowledge or
information that the Buyer may have, the Seller and each Seller Party shall
jointly and severally indemnify and fully defend, save and hold the Buyer,
any Affiliate of the Buyer and their respective directors, officers, agents
and employees, harmless if any such Person shall at any time or from time to
time suffer any damage, liability, loss, cost, expense (including all
reasonable attorneys' fees), deficiency, interest, penalty, impositions,
assessments or fines (collectively, "Losses") arising out of or resulting
from, or shall pay or become obliged to pay any sum on account of, one or
more of the following:
(i) any untruth or inaccuracy in any representation or
certification of the Seller or any Seller Party or the breach of any warranty
of the Seller or any Seller Party contained in this Agreement, any other
Transaction Document or in any certificate delivered to the Buyer in
connection with the Closing; or
(ii) any failure of the Seller or any Seller Party duly to
perform or observe any of its covenants or agreements contained in this
Agreement or any other Transaction Document; or
(iii) any successor liability of any Company or the Buyer for
debts or liabilities of Grupo Xxxxxx or any of its Subsidiaries (including
the Niples Companies) which were not expressly assumed by such Company
pursuant to the Grupo Nicna Reorganization; or
(iv) any Environmental Claim arising out of acts, omissions
or conditions in existence or first occurring on or prior to the Closing Date;
or
(v) any product liability for products sold prior to the
Closing Date; provided that any indemnification claim pursuant to this clause
(v) must be made on or prior to April 30, 2007.
SECTION 10.3. Indemnification by the Xxxxxxx Comercial.
Notwithstanding the Closing, Xxxxxxx Comercial shall indemnify and agree to
fully defend, save and hold the Seller and each Seller Party, any Affiliate
of the Seller or the Seller Parties and their respective directors, officers,
agents and employees harmless if any such Person shall at any time or from
time to time suffer any Losses arising out of or resulting from, or shall pay
or become obligated to pay any sum on account of any one or more of the
following:
(i) any untruth or inaccuracy in any representation or
certification of the Buyer or the breach of any warranty of the Buyer
contained in this Agreement, the other Transaction Documents or in any
certificate delivered to the Seller in connection with the Closing; or
(ii) any failure of the Buyer duly to perform or observe any
of its covenants or agreements contained in this Agreement or any other
Transaction Document.
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SECTION 10.4. Procedures for Indemnification.
(a) If a party entitled to indemnification under this
Section 10 (an "Indemnitee") asserts that a party obligated to indemnify it
under this Section 10 (an "Indemnitor") has become obligated to such
Indemnitee pursuant to Section 10.2 or 10.3, or if any suit, action,
investigation, claim or proceeding is begun, made or instituted as a result
of which the Indemnitor may become obligated to an Indemnitee hereunder, such
Indemnitee shall give written notice to the Indemnitor. The Indemnitor agrees
to defend, contest or otherwise protect the Indemnitee against any such suit,
action, investigation, claim or proceeding at its sole cost and expense. The
Indemnitor shall not consent to a settlement of, or the entry of any judgment
arising from, any such suit, action investigation, claim or proceeding unless
it has given 15 days' prior written notice of the same to the Indemnitee and
has obtained the written consent of the Indemnitee to such settlement or
judgment, which consent will not be withheld if the sole relief is monetary
damages that will be paid in full by the Indemnitor and otherwise will not be
unreasonably withheld. The Indemnitee shall have the right, but not the
obligation, to participate at its own expense in the defense thereof by
counsel of the Indemnitee's choice and shall in any event cooperate with and
assist the Indemnitor to the extent reasonably possible. If the Indemnitor
fails timely to defend, contest or otherwise protect against such suit,
action, investigation, claim or proceeding, the Indemnitee shall have the
right to do so, including, without limitation, the right to make any
compromise or settlement thereof, and the Indemnitee shall be entitled to
recover the entire cost thereof from the Indemnitor, including, without
limitation, reasonable attorneys' fees, disbursements and amounts paid as the
result of such suit, action, investigation, claim or proceeding.
(b) Neither the Seller nor the Seller Parties will have
liability (for indemnification or otherwise) with respect to the matters
described in Section 10.2(i) (other than for a breach of Sections 5.5, 5.9
5.13(a) or 5.20) until the total of all Losses with respect to such matters
exceeds three hundred seventy five thousand dollars ($375,000), it being
understood that once such amount is exceeded, the Seller and the Seller
Parties shall be jointly and severally liable for the aggregate of all such
Losses (from the first dollar of Loss). In no event shall any liability of
Seller or the Seller Parties with respect to the matters described in Section
10.2(i) (other than for a breach of Sections 5.5, 5.9, 5.13(a) or 5.20)
exceed eight million six hundred thousand dollars ($8,600,000), in the
aggregate.
(c) For purposes of Section 10.2(i), all Losses arising out
of or relating to breach of Section 5.12 shall be computed net of any net
collections from insurance policies that reduce the Losses that would
otherwise be sustained.
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SECTION 11. CONDITIONS PRECEDENT TO PERFORMANCE BY THE SELLER AND
THE SELLER PARTIES.
The obligations of the Seller and the Seller Parties to
consummate the transactions contemplated by this Agreement are subject to the
fulfillment, at or before the Closing Date, of the following conditions, any
one or more of which (other than Section 13.4) may be waived by the Seller
and the Seller Parties in their sole discretion:
SECTION 11.1. Representations and Warranties of the Buyer.
All representations and warranties made by the Buyer in this Agreement shall be
true and correct in all material respects on and as of the Closing Date as if
again made by the Buyer on and as of such date, and the Seller shall have
received a certificate to that effect dated the Closing Date and signed by an
officer of the Buyer.
SECTION 11.2. Performance of the Obligations of the Buyer.
The Buyer shall have performed all obligations required under this Agreement to
be performed by it on or before the Closing Date, and the Seller shall have
received a certificate to that effect dated the Closing Date and signed by an
officer of the Buyer.
SECTION 11.3. No Violation of Orders. No preliminary or
permanent injunction or other order issued by any court or Governmental
Entity, nor any statute, rule, regulation, decree or executive order
promulgated or enacted by any Governmental Entity that declares this
Agreement invalid or unenforceable in any respect or which prevents the
consummation of the transactions contemplated hereby shall be in effect; and
no action or proceeding before any court or Governmental Entity, shall have
been instituted or threatened or instituted by any other Person, which seeks
to prevent or delay the consummation of the transactions contemplated by this
Agreement or which challenges the validity or enforceability of this
Agreement, and which in any such case has a reasonable likelihood of success
in the opinion of counsel to the Seller.
SECTION 12. CONDITIONS PRECEDENT TO PERFORMANCE BY THE BUYER.
The obligations of the Buyer to consummate the transactions
contemplated by this Agreement are subject to the fulfillment, at or before
the Closing Date, of the following conditions, any one or more of which
(other than Section 14.4) may be waived by the Buyer in its sole discretion:
SECTION 12.1. Representations and Warranties of the Seller
Parties and the Seller. All representations and warranties made by the
Seller and each Seller Party in this Agreement shall be true and correct in
all material respects on and as of the Closing Date as if again made by the
Seller and such Seller Party on and as of such date, and the Buyer shall have
received a certificate to that effect dated the Closing Date and signed by an
officer of the Seller and by each Seller Party.
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SECTION 12.2. Performance of the Obligations of the Seller
Parties and the Seller. The Seller and each Seller Party shall have
performed all obligations and taken all corporate actions required under this
Agreement or under other applicable documents (including their Certificates
or Articles of Incorporation or By-laws (or equivalent documents)) to be
performed by it on or before the Closing Date, and the Buyer shall have
received a certificate to that effect dated the Closing Date and signed by an
officer of the Seller and by each Seller Party.
SECTION 12.3. Consents and Approvals. All consents, waivers,
authorizations and approvals of any Governmental Entity and of any other
Person, required from the Seller or the Seller Parties in connection with the
execution, delivery and performance of this Agreement shall have been duly
obtained and shall be in full force and effect on the Closing Date.
SECTION 12.4. No Violation of Orders. No preliminary or
permanent injunction or other order issued by any court or Governmental
Entity, nor any statute, rule, regulation, decree or executive order
promulgated or enacted by any Governmental Entity, which declares this
Agreement invalid in any respect or prevents the consummation of the
transactions contemplated hereby, or which materially and adversely affects
the assets, properties or operations of any Company shall be in effect; and
no action or proceeding before any court or Governmental Entity, shall have
been instituted or threatened or instituted by any other Person which seeks
to prevent or delay the consummation of the transactions contemplated by this
Agreement or which challenges the validity or enforceability of this
Agreement, and which in either such case has a reasonable likelihood of
success in the opinion of counsel to the Buyer.
SECTION 12.5. Opinion of Counsel. The Buyer shall have
received an opinion, dated as of the Closing Date, from counsel to the Seller
and the Seller Parties, in form and substance reasonably acceptable to the
Buyer.
SECTION 12.6. Escrow Agreement. The Seller shall have
executed and delivered to the Buyer the Escrow Agreement, the Escrow Agreement
shall be in full force and effect and the Seller shall not be in breach thereof.
SECTION 12.7. Mortgage Release. The Seller shall have
received from Scotiabank Inverlat, S.A., Institucion de Banca Multiple, Grupo
Financiero Scotiabank Inverlat, as lender under that certain Simple and
Revolving Account Loan Agreement with Mortgage and Pledge Securities, dated
as of July 2, 2004, a payoff letter confirming payment in full of the loans
under such loan agreement, release of any Liens on the Niples Companies'
assets and filings for cancellation of such Liens before the relevant Public
Registries of Commerce.
SECTION 12.8. Other Closing Documents. The Buyer shall have
received such other certificates, instruments and documents in confirmation
of the representations and warranties of the Seller and each Seller Party or
in furtherance of the transactions contemplated by this Agreement as the
Buyer or its counsel may reasonably request.
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SECTION 12.9. Legal Matters. All certificates, instruments,
opinions and other documents required to be executed or delivered by or on
behalf of any Seller Party, the Seller or the Companies under the provisions
of this Agreement, and all other actions and proceedings required to be taken
by or on behalf of any Seller Party or the Seller or the Companies in
furtherance of the transactions contemplated hereby, shall be reasonably
satisfactory in form and substance to counsel to the Buyer.
SECTION 13. MISCELLANEOUS.
SECTION 13.1. Successors and Assigns. Except as otherwise
provided in this Agreement, no party hereto shall assign this Agreement or
any rights or obligations hereunder without the prior written consent of the
other parties hereto and any such attempted assignment without such prior
written consent shall be void and of no force and effect. This Agreement
shall inure to the benefit of and shall be binding upon the successors and
permitted assigns of the parties hereto.
SECTION 13.2. Governing Law, Jurisdiction.
(a) This Agreement shall be construed in accordance with and
governed by the law of the State of New York; provided, however, that in
connection with any legal action or proceeding (other than an action to enforce
a judgment obtained in another jurisdiction) brought in respect to this
Agreement in the courts of Mexico or any political subdivision thereof, this
Agreement shall be deemed to be an instrument made under the laws of Mexico and
for such purposes shall be governed by, and construed in accordance with, the
laws of the Federal District of Mexico.
(b) Each party hereto hereby irrevocably and unconditionally
submits, for itself and its property, to the nonexclusive jurisdiction of the
Supreme Court of the State of New York sitting in New York County and of the
United States District Court of the Southern District of New York, and any
appellate court thereof, in any action or proceeding arising out of or
relating to this Agreement, or for recognition or enforcement of any
judgment, and each party hereto hereby irrevocably and unconditionally agrees
that all claims in respect of any such action or proceeding may be heard and
determined in such New York State or in such Federal court. Each party
hereto agrees that a final judgment in any such action or proceeding shall be
conclusive and may be enforced in other jurisdictions (including Mexico) by
suit on the judgment or in any other manner provided by law. Nothing in this
Agreement shall affect any right that the Buyer may otherwise have to bring
any action or proceeding relating to this Agreement against the Seller or the
Seller Parties or their properties in the courts of any jurisdiction.
(c) Without limiting the provisions of paragraph (b) of this
Section 13.2, each party hereto hereby irrevocably and unconditionally
submit, for itself and its property, to the nonexclusive jurisdiction of the
competent courts of Mexico City, Federal District, Mexico, and any appellate
court from any thereof, in any action or proceeding arising out of or
relating to this Agreement, or for recognition or enforcement of any
judgment, and each party hereto hereby irrevocably and unconditionally agree
that all claims in respect of any such action or proceeding may be heard and
determined in any such courts. Each party hereto hereby waive any rights to
a specific jurisdiction it may have by virtue of its present or any future
domicile, or otherwise.
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(d) Each party hereto hereby irrevocably and unconditionally
waives, to the fullest extent it may legally and effectively do so, 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 in
any court referred to in paragraph (b) or (c) of this Section 13.2. Each
party hereto hereby irrevocably waives, to the fullest extent permitted by
law, the defense of an inconvenient forum to the maintenance of such action
or proceeding in any such court.
(e) The Seller and each of the Seller Parties hereby agrees
that at any time prior to December 10, 2009, service of all writs, process
and summonses in any such suit, action or proceeding brought in the State of
New York may be made upon CT Corporation System, presently located at 000
Xxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, X.X.X. (the "Process Agent"), and
each of the Seller Parties hereby confirms and agrees that the Process Agent
has been duly and irrevocably appointed as its agent and true and lawful
attorney-in-fact in its name, place and stead to accept such service of any
and all such writs, process and summonses, and agrees that the failure of the
Process Agent to give any notice of any such service of process to the Seller
Parties shall not impair or affect the validity of such service or of any
judgment based thereon. Each party to this Agreement further irrevocably
consents to service of process in the manner provided for written notices in
Section 13.6. Nothing in this Agreement will affect the right of any party to
this Agreement to serve process in any other manner permitted by law.
SECTION 13.3. Expenses. The Seller and each Seller Party
shall pay any legal, accounting and other fees, expenses and costs incurred by
it, Grupo Xxxxxx, the Niples Companies or the Companies in connection with this
Agreement, the other Transaction Documents and the transactions contemplated
hereby and thereby (including without limitation the Grupo Nicna
Reorganization). All of the other fees, expenses and costs incurred in
connection with this Agreement and the other Transaction Documents and the
transactions contemplated hereby and thereby shall be paid by the party
hereto incurring such fees, expenses and costs.
SECTION 13.4. Broker's and Finder's Fees. The Buyer
represents and warrants that it has not dealt with a broker or finder in
connection with any of the transactions contemplated by this Agreement or the
other Transaction Documents. The Seller represents and warrants that neither
the Seller, the Seller Parties or the Companies have dealt with a broker or
finder in connection with any of the transactions contemplated by this
Agreement or the other Transaction Documents.
SECTION 13.5. Severability. In the event that any part of
this Agreement is declared by any court or other judicial or administrative
body to be null, void or unenforceable, said provision shall survive to the
extent it is not so declared, and all of the other provisions of this
Agreement shall remain in full force and effect.
SECTION 13.6. Notices. All notices, requests, demands and
other communications under this Agreement shall be in writing and shall be
deemed to have been duly given (i) on the date of service if served personally
on the party to whom notice is to be given; (ii) on the day of transmission if
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sent via facsimile transmission to the facsimile number given below, and
telephonic confirmation of receipt is obtained promptly after completion of
transmission; (iii) on the second Business Day after delivery to Federal
Express or similar overnight courier ; or (iv) on the date of receipt, if
mailed to the party to whom notice is to be given, by first class mail,
registered or certified, postage prepaid and properly addressed, to the party
as follows:
If to the Seller or any Seller Party:
Xxxx Xxxxxxx Cirano
0000 XxXxxxxxx Xxxx
XXX 000
Xxxxxx, XX 00000
Telecopy: (000) 000-0000
Copy to:
Xxxxxxxx & Knight LLP
0000 Xxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, XX 00000
Attn: Xxxxxxx X. Xxxxxx, Esq.
Telecopy: (000) 000-0000
and
Deloitte Xxxxx, Yamazaki
Xxxx Xxxxxxx, S.C.
Xxxxxx Xxxxxxxx 2321 Pte., PB
Residencial San Xxxxxxx
66260 Xxxxx Xxxxxx, N.L.
Mexico
Attn: Xxxxxxx Xxxxxx
Telecopy: 00 (00) 0000 0000
If to the Buyer:
Xxxxxxx Comercial de Mexico,
S. de X.X. de C.V.
c/o Mueller Industries, Inc.
0000 Xxxxxxxxxx Xxxxx, Xxxxx 000
Xxxxxxx, Xxxxxxxxx 00000
Attn: General Counsel
Telecopy: (000) 000-0000
Copy to:
Xxxxxxx Xxxx & Xxxxxxxxx LLP
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxx Xxxxxxxx, Esq.
Telecopy: (000) 000-0000
Any party may change its address for the purpose of this Section
by giving the other party written notice of its new address in the manner set
forth above.
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SECTION 13.7. Amendments; Waivers. This Agreement may be
amended or modified, and any of the terms, covenants, representations,
warranties or conditions hereof may be waived, only by a written instrument
executed by the parties hereto, or in the case of a waiver, by the party
waiving compliance. Any waiver by any party of any condition, or of the
breach of any provision, term, covenant, representation or warranty contained
in this Agreement, in any one or more instances, shall not be deemed to be
nor construed as a further or continuing waiver of any such condition, or of
the breach of any other provision, term, covenant, representation or warranty
of this Agreement.
SECTION 13.8. Entire Agreement. This Agreement and the other
Transaction Documents contain the entire understanding among the parties
hereto with respect to the transactions contemplated hereby and supersedes
and replaces all prior and contemporaneous agreements and understandings,
oral or written, with regard to such transactions. All Exhibits and
schedules hereto and any documents and instruments delivered pursuant to any
provision hereof are expressly made a part of this Agreement as fully as
though completely set forth herein.
SECTION 13.9. Parties in Interest. Nothing in this Agreement
is intended to confer any rights or remedies under or by reason of this
Agreement on any Persons other than parties hereto and their respective
successors and permitted assigns. Nothing in this Agreement is intended to
relieve or discharge the obligations or liability of any third Persons to the
Seller or the Buyer. No provision of this Agreement shall give any third
parties any right of subrogation or action over or against the Seller or the
Buyer.
SECTION 13.10. Scheduled Disclosures. Disclosure of any
matter, fact or circumstance in a Schedule to this Agreement shall not be
deemed to be disclosure thereof for purposes of any other Schedule hereto.
SECTION 13.11. Section and Paragraph Headings. The section
and paragraph headings in this Agreement are for reference purposes only and
shall not affect the meaning or interpretation of this Agreement.
SECTION 13.12. Counterparts. This Agreement may be executed
in counterparts, each of which shall be deemed an original, but all of which
shall constitute the same instrument.
SECTION 13.13. Language. This Agreement shall be executed in
both the English and Spanish languages, both versions of which shall bind the
parties hereto; provided, however, that in the event of any inconsistency
between the English version and the Spanish version, or in the case of any
doubt as to the proper interpretation or construction of this Agreement, the
English version shall be controlling in all instances, except in connection
with any legal action or proceeding (other than in an action to enforce a
judgment obtained in another jurisdiction) brought by any party hereto with
respect to this Agreement in the courts of Mexico City, Federal District,
Mexico, in which instance the Spanish version shall be controlling.
Notwithstanding the foregoing, on the date hereof, the English version shall
be the only version executed, it being understood that the parties agree to
comply with following procedure:
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(i) No later than 45 Business Days after the date hereof,
Mexican counsel to the Buyer shall deliver by e-mail a Spanish translation of
this Agreement (the "Spanish Translation") to Mexican counsel to the Seller
(such delivery date, the "Initial Submission Date").
(ii) No later than 21 Business Days after the Initial
Submission Date, Mexican counsel to the Seller may either agree to the terms of
the Spanish Translation or deliver by e-mail to Mexican counsel to the Buyer a
revised version of such Spanish Translation with any comments Mexican counsel
to the Seller may have (such delivery date, the "Second Submission Date").
(iii) No later than 10 Business Days after the Second
Submission Date, Mexican counsel to the Buyer may either agree to such revised
version of the Spanish Translation or dispute any comments made by Mexican
counsel to the Seller (the "Disputed Provisions") by delivering an e-mail to
Mexican counsel to the Seller setting forth the Disputed Provisions (such
delivery date, the "Third Submission Date").
(iv) If Mexican counsel to the Seller does not agree with
Mexican counsel to the Buyer to a resolution of the Disputed Provisions within
5 days of the Third Submission Date, then Mexican counsel to the Seller may (i)
notify Mexican counsel to the Buyer that they wish to submit the Spanish
Translation to Xxxxxx Xxxxxxx Xxxxxxxxx or another lawyer mutually acceptable
to the Buyer and the Seller (the "Mediator") for final resolution of the
Disputed Provisions, and for such purposes (ii) send a copy of this Agreement
and the Spanish Translation to the Mediator, by e-mail, indicating the
Disputed Provisions, a copy of which shall be sent to Mexican counsel to the
Buyer.
(v) No later than 30 Business Days after delivery of the
notice referred to above, the Mediator shall deliver by e-mail his translation
of the Disputed Provisions to Mexican counsel to the Buyer and the Seller.
The Spanish Translation, as amended by the Mediator, shall be the definitive
Spanish Translation of this Agreement.
For purposes of this Section 13.13., the parties hereto agree
that the notices hereunder shall be furnished to their respective Mexican
counsel or the Mediator, as the case may be, as follows:
If to Mexican counsel to the Buyer:
Xxxx Xxxxxx Xxxxxx
Xxxxxxxx Xxxxxxxx, S.C.
xxxxxxx@xxxx.xxx.xx
and
Xxxxxxx Xxxxx del Xxxxxxxx
Xxxxxxxx Xxxxxxxx, S.C.
xxxxxx@xxxx.xxx.xx
If to Mexican counsel to the Seller:
Xxxxxxx Xxxxxx
Deloitte
xxxxxxx@xxxxx.xxx
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If to the Mediator:
Xxxxxx Xxxxxxx Xxxxxxxxx
Xxxxx, Xxxxxxx & Xxxxxxx, S.C.
xxxxxxxx@xxx.xxx.xx
If Mexican counsel to the Seller or the Buyer, as the case may
be, does not respond within the response periods set forth above, then such
non-responding counsel shall be deemed to have agreed to the Spanish Version
last delivered to such non-responding counsel and such version of the Spanish
Translation shall be the definitive Spanish Translation of this Agreement.
SECTION 13.14. Monetary Denominations. References in this
Agreement to dollars or to $ shall mean United States dollars unless
otherwise indicated.
SECTION 13.15. Construction. For all purposes of this
Agreement, any representation, warranty or covenant of the Seller shall be a
joint and several representation, warranty and covenant of Miyar and Nicna.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be executed as of the date first above written.
XXXXXXX COMERCIAL DE MEXICO,
S. de X.X. de C.V
By: /s/Xxxxxxx X. Xxxxx
Name:
Title:
WTC HOLDCO I, LLC
By: /s/Xxxxxxx X. Xxxxxxx
Name:
Title:
MIYAR LLC
By: /s/Xxxxxx Brashwaite
Name: Xxxxxx Brashwaite
Title: Authorized Signer
NICNA, GMBH
By: /s/Xxxxxx Brashwaite
Name: Xxxxxx Brashwaite
Title: Authorized Signer
/s/Xxxx Xxxxxxx Cirano
Xxxx Xxxxxxx Cirano
/s/Xxxxxxx Xxxxxx Wengrowsky
Xxxxxxx Xxxxxx Wengrowsky
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