EXHIBIT 10.9
ASSET PURCHASE AGREEMENT
This Asset Purchase Agreement (the "Agreement") is made and entered into as of
this 15th day of February, 2002 by and between Hydralift ASA, a Norwegian
limited company or a company to be nominated by Hydralift ASA (the "Buyer"), on
the one hand, and Xxxxxx Xxxxxxx Halter, Inc. a Mississippi corporation, AmClyde
Engineered Products Company, Inc. a Delaware corporation, Xxxxx Xxxxxx, Inc., a
Louisiana corporation, Utility Steel Fabrication, Inc., a Louisiana corporation,
Xxxxxx Xxxxxxx Halter Engineered Products Group, Inc., a Delaware corporation,
Halter Marine, Inc., a Nevada corporation, and any other subsidiaries of Xxxxxx
Xxxxxxx Halter, Inc., with any interest in the Property, as defined below,
Debtors-in-Possession (collectively the "Seller") under jointly administered
Case No. 01-52173 (the "Case") in the United States Bankruptcy Court in the
Southern District of Mississippi (the "Bankruptcy Court") filed on April 19,
2001 the ("Petition Date").
RECITALS
A. Seller is engaged in a variety of businesses related to the design,
manufacture, conversion and modification of offshore drilling rigs, marine
vessels and engineered products for the maritime and offshore energy
industries. The relevant line of business for the purposes of this
Agreement is the Seller's business segment specifically involved in the
design and manufacture of cranes, winches, mooring systems and marine deck
equipment, known within the Seller's operations as the Engineered Products
Group, (the "Business").
B. Seller wishes to sell to Buyer substantially all the assets it uses in
connection with the Business at the price and on the other terms and
conditions specified in detail below and Buyer wishes to so purchase and
acquire such assets from Seller.
NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency
of which is hereby acknowledged, the parties agree as follows:
1. TRANSFER OF ASSETS
1.1 PURCHASE AND SALE OF ASSETS
On the Closing Date, as hereinafter defined, in consideration of the covenants,
representations and obligations of Buyer hereunder, and subject to the
conditions hereinafter set forth, Seller shall sell, assign, transfer, convey
and deliver to Buyer, and Buyer shall purchase from Seller all of Seller's
right, title and interest as of the Closing Date in and to the following assets,
wherever located (collectively, the "Property"):
1.1.1 Leases and Contracts.
Seller's right, title and interest (i) as lessee under those real property
leases described on EXHIBIT "A-1" to this Agreement (collectively, the "Real
Property Leases"), (ii) as lessee under those equipment, personal property and
intangible property leases, rental agreements, licenses, contracts, agreements
and similar arrangements described on EXHIBIT "A-2" to this Agreement
(collectively, the "Other Leases"), and (iii) as a party to those other
contracts, leases, orders, purchase orders, licenses, contracts, agreements and
similar arrangements described on EXHIBIT
"A-3" (collectively, the "Other Contracts" and together with the Other Leases,
the "Other Leases and Contracts"); provided, however, that in the event Buyer
notifies Seller in writing by not later than March 8, 2002 that Buyer has
determined not to acquire any or all of the sales representative and
distribution agreements described in items 25 through 38 of Schedule A-3, such
agreements shall not be transferred to Buyer pursuant to this Agreement, and
shall be Excluded Assets hereunder.
1.1.2 Real Property and Improvements.
Seller's ownership interest in that certain real property described in EXHIBIT
"A-4" and all improvements located thereon (collectively, the "Real Property"),
but in all events only to the extent, if any, Seller's interest in the same
(collectively, the "Improvements"). Notwithstanding the foregoing, in the event
that Buyer elects to conduct an environmental investigation of a Facility or
Facilities, as defined in and provided for in Section 8.3 below, and thereafter
Buyer determines in its sole discretion not to acquire any such Facility or
Facilities pursuant to this Agreement, then Buyer may so notify Sellers in
writing, by not later than March 22, 2002, in which event the Facility or
Facilities shall not be sold and transferred to Buyer pursuant to this
Agreement, and the Cash Purchase Price hereunder shall be reduced by (i)
$1,000,000 if Buyer so elects not to acquire the Xxxxxxxxx Facility, (ii)
$250,000 if Buyer so elects not to acquire the Cabiran Road Facility, and (iii)
$250,000 if Buyer so elects not to acquire the Liberty Bayou Facility, each as
defined below.
1.1.3 Personal Property
All of those items of equipment and tangible personal property owned by Seller
and listed in EXHIBIT "B" attached to this Agreement and any other tangible
personal property acquired by Seller after the date hereof but prior to the
Closing Date exclusively in connection with the Business, (collectively, the
"Personal Property"); provided, however, that if Buyer elects not to acquire a
Facility or Facilities as provided in Section 1.1.2 above, Buyer shall not
acquire any Personal Property located at any such Facility or Facilities. As
used in this Agreement, the Personal Property shall not include the Inventory.
1.1.4 Intangible Property
All intangible personal property owned or held by Seller and used exclusively in
connection with the Business, but in all cases only to the extent of Seller's
interest therein and only to the extent transferable, together with all books,
records and like items pertaining exclusively to the Business (collectively, the
"Intangible Property"), including, without limitation, the name AmClyde and the
other items identified on EXHIBIT "C" hereto. As used in this Agreement,
Intangible Property shall in all events exclude, (i) any materials containing
privileged communications or information about employees, disclosure of which
would violate an employee's reasonable expectation of privacy and any other
materials which are subject to attorney-client or any other privilege or
requirement to maintain confidentiality (including any rights to assert
privilege), and (ii) Seller's corporate books and records relating to its
organization and existence.
Sch. 8.7, Pg. 2
1.1.5 Receivables
All accounts receivable arising out of the operation of the Business which are
60 days or less outstanding as of the Closing Date, subject to Section 1.2, and
all causes of action relating or pertaining to the foregoing (collectively, the
"Receivables").
1.1.6 Inventory
All supplies, goods, materials, inventory and stock in trade owned by Seller
exclusively for use or sale in the ordinary course of the Business hereto
(collectively, the "Inventory").
1.1.7 Stock
All stock in the following subsidiary: AmClyde UK Limited, Glasgow, Scotland
(the "Purchased Subsidiary").
1.2 EXCLUDED ASSETS
Notwithstanding anything to the contrary in this Agreement, the Property shall
not include the following assets (collectively, the "Excluded Assets"): (i)
those items excluded pursuant to the provisions of Section 1.1 above; (ii) all
cash and cash equivalents, except for any cash held by the Purchased Subsidiary,
and; (iii) Inventory transferred or used by Seller in the ordinary course of the
Business prior to the Closing Date; (iv) any lease, rental agreement, contract,
agreement, license or similar arrangement ("Contracts") terminated or expired
prior to the Closing Date in accordance with its terms or in the ordinary course
of the Business; (v) any right, property or asset listed on EXHIBIT "D" hereto;
(vi) all preference or avoidance claims and actions of the Seller, including,
without limitation, any such claims and actions arising under Sections 544, 547,
548, 549, and 550 of the United States Bankruptcy Code; (vii) the Seller's
rights under this Agreement and all cash and non-cash consideration payable or
deliverable to the Seller pursuant to the terms and provisions hereof; (viii)
insurance proceeds, claims and causes of action with respect to or arising in
connection with (A) any Contract which is not assigned to Buyer at the Closing,
or (B) any item of tangible or intangible property not acquired by Buyer at the
Closing or (ix) any accounts receivable of the Business that are greater than 60
days outstanding on the Closing Date or which are expected to become subject to
a dispute or claim as mutually determined by Buyer and Seller on the Closing
Date (the "Excluded Receivables").
1.3 INSTRUMENTS OF TRANSFER
The sale, assignment, transfer, conveyance and delivery of the Property to Buyer
and the assumption of liabilities provided herein by Buyer shall be made by
assignments, xxxx of sale, deed, stock power and other instruments of
assignment, transfer and conveyance provided for in Section 3 below and such
other instruments as may reasonably be requested by Buyer or Seller. None of
the foregoing documents shall increase in any material way the burdens imposed
by this Agreement upon Seller or Buyer.
Sch. 8.7, Pg. 3
2. CONSIDERATION
2.1 PURCHASE PRICE.
2.1.1 The cash consideration to be paid by Buyer to Seller for the Property
(the "Purchase Price") shall be US $36,000,000 (United States Dollars
Thirty-Six million 00/100), subject to any adjustments as provided in
Section 1.1.2 and Section 2.2 hereof (the "Final Purchase Price").
2.1.2 Concurrently with the mutual execution and delivery of this Agreement
(the date of such mutual execution and delivery is sometimes referred to
herein as the "Execution Date"), Buyer shall deposit into escrow (the
"Escrow") with an escrow agent or company (the "Deposit Escrow Holder")
reasonably designated by Seller US $ 5,000,000 (United States Dollars
Five million 00/100) (the "Deposit") in immediately available, good funds
(funds delivered in this manner are referred to herein as "Good Funds"),
pursuant to joint escrow instructions to be delivered to and acknowledged
by the Deposit Escrow Holder in writing on or before the Execution Date.
Such escrow instructions shall include the provisions set forth in this
Section 2.1. Upon receipt of the Deposit, the Deposit Escrow Holder shall
immediately deposit the Deposit into an interest-bearing account. The
Deposit shall become nonrefundable upon the earlier of (x) the approval
of Buyer as the approved Buyer at the hearing on the Sale Motion (as
defined in Section 8.4.2 below), or (y) the termination of the
transaction contemplated by this Agreement by reason of Buyer's default
(a "Buyer Default Termination"). At the Closing, the Deposit (and any
interest accrued thereon) shall be delivered to Seller and credited
toward payment of the Purchase Price in the manner specified in Section
2.1.3 below. In the event the Deposit becomes non-refundable by reason of
a Buyer Default Termination, Deposit Escrow Holder shall immediately
disburse the Deposit and all interest accrued thereon to Seller to be
retained by Seller for its own account. If the transactions contemplated
herein terminate by reason of (A) Seller's default, (B) the failure of a
condition to Buyer's obligations, or (C) the consummation of a sale to a
third party as described in Section 8.4.1 below, the Deposit Escrow
Holder shall return to Buyer the Deposit (together with all interest
thereon). The Deposit Escrow Holder's escrow fees and charges shall be
paid one-half by Seller and one-half by Buyer, in which respect the
Seller and the Buyer shall not be jointly liable since each shall only be
liable for its own part (one-half) of the said fees and charges.
2.1.3 On the Closing Date, Buyer shall (i) pay and deliver to Seller, by wire
transfer in Good Funds, the Purchase Price less (a) the Deposit (and
interest accrued thereon), (b) the Working Capital Escrow Amount (as
defined below), and (c) the Warranty Reserve Escrow Amount (as defined
below), (ii) instruct the Deposit Escrow Holder in writing to deliver the
Deposit (and any interest accrued thereon) to Seller, by wire transfer of
Good Funds, (iii) pay and deliver in Good Funds the Warranty Reserve
Amount to the Warranty Reserve Escrow Agent to be held in the Warranty
Reserve Escrow Account in accordance with the provisions of the Warranty
Reserve Escrow Agreement, each as defined in, and as provided for in
Section 8.7 below, and (iv) pay and deliver to an escrow account (the
"Working Capital Adjustment Escrow Account") governed by an escrow
agreement (the "Working Capital Escrow Agreement") mutually acceptable to
Sch. 8.7, Pg. 4
Buyer and Seller, dated as of the Closing Date, by and among the Seller,
the Buyer and an escrow agent mutually agreed upon by Buyer and Seller
(the "Working Capital Escrow Agent"), an amount equal to $ 7,500,000 (the
"Working Capital Escrow Amount") in Good Funds, which will be available
to satisfy any amounts owed by the Seller to the Buyer pursuant to
Section 2.2 hereof. Any portion of the Working Capital Escrow Amount not
necessary to satisfy amounts payable to Buyer pursuant to such Section
2.2 shall promptly be disbursed to Seller together with all interest
accrued thereon. The Working Capital Escrow Agent's escrow fees and
charges shall be paid one-half by Seller and one-half by Buyer, in which
respect the Seller and the Buyer shall not be jointly liable since each
shall only be liable for its own part (one-half) of the said fees and
charges.
2.2 POST-CLOSING ADJUSTMENT.
2.2.1 CALCULATION OF NET WORKING CAPITAL AT CLOSING DATE. Within 30
calendar days of the Closing Date, Seller's independent public accountants shall
compute the amount of Net Working Capital of the Business as of the Closing Date
in accordance with the methods and conventions of US GAAP (except that all
accounts receivable greater than 60 days outstanding or which are expected to
become subject to a dispute or claim (as mutually determined by Buyer and
Seller) shall be deducted in their entirety from Net Working Capital, and an
amount equal to the cash held by the Purchased Subsidiary not to exceed US
$200,000 at the Closing Date shall be included as a Current Asset in calculating
Net Working Capital), and shall provide Buyer a summary reflecting how such
computations were made. Buyer and its accountants shall within ten business
days have the opportunity to review such computations and the said summary.
2.2.2 NET WORKING CAPITAL AT DATE OF MOST RECENT BALANCE SHEET. By way of
example, a copy of the Net Working Capital calculation as of December 31, 2001,
is attached hereto as Schedule 2.2.
2.2.3 PAYMENT OF ADJUSTMENT AMOUNTS. If the Net Working Capital of the
Business as of the Closing Date is greater than $6,200,000, then Buyer shall,
within ten business days of such computation by Seller's independent public
accountants, pay Seller, by wire transfer, an amount equal to the amount by
which such Net Working Capital exceeds $6,200,000. If the Net Working Capital
as of the Closing Date is less than $6,200,000, then Seller, within ten business
days of such computation, shall pay Buyer, by wire transfer, an amount equal to
the difference between $6,200,000 and the amount of Net Working Capital as of
the Closing Date.
2.2.4 DISPUTES. Within ten business days of receipt of the computations
referred to in Section 2.2.1 above, the Buyer shall notify the Seller whether it
disputes any aspect of such computations or accepts them. If the Buyer disputes
such computations, the parties shall work together in good faith to resolve the
dispute. If they are unable to resolve the dispute within five business days,
the dispute shall be referred to such nationally recognized accounting firm as
the Buyer and Seller may mutually agree upon, or if they are unable to agree to
such accounting firm within five additional business days, as designated by the
Bankruptcy Court. Such accounting firm shall be instructed to resolve the
dispute not later than ten business days following the referral of the dispute
to such accounting firm. The resolution of the dispute by such accounting firm
shall be binding on Buyer and Seller and may be enforced by the Bankruptcy
Court.
Sch. 8.7, Pg. 5
"Current Assets" means the amounts reflected as current assets of the
Business on its financial statements determined in accordance with the methods
and conventions customarily used by Seller in preparing its internal financial
statements and includes, but is not limited to, items such as accounts
receivable (less reserves for doubtful accounts), costs in excess of xxxxxxxx,
contract work in progress, short-term investments, deposits of all types,
inventory and current prepaid assets; provided, however, that neither cash, nor
cash equivalents, nor any other asset that is an Excluded Asset (except for an
amount equal to cash held by the Purchased Subsidiary, not to exceed $200,000,
on the Closing Date as provided above) shall be considered a Current Asset.
"Current Liabilities" means the amounts reflected as current liabilities of
the Business on its financial statements determined in accordance with the
methods and conventions customarily used by Seller in preparing its month-end
internal financial statements and includes, but is not limited to, items such as
post-petition accounts payable, xxxxxxxx in excess of costs, accrued expenses,
and unpaid accrued taxes; provided, however, that neither (a) current maturities
of indebtedness for borrowed money or capital leases (including interest
thereon), (b) amounts payable with respect to the deferred purchase price
payments payable to Norson Engineering Limited on December 8, 2001 and March 8,
2002, nor (c) any obligations that are not Assumed Liabilities, will be deemed a
Current Liability.
"Net Working Capital" means the difference between the Current Assets and
the Current Liabilities of the Business as of the date of computation.
2.3 ASSUMED LIABILITIES
Buyer shall, effective as of the Closing Date, (i) assume and perform all
liabilities accruing under the Real Property Leases and under the Other Leases
and Contracts on and after the Closing Date or otherwise required to be
performed with respect to the property on or after the Closing Date and Buyer
shall pay all cure amounts owing under any of the Real Property Leases, Other
Leases and Contracts as of the Closing which the Bankruptcy Court may order to
be paid as a condition to the Seller's assignment and Buyers' assumption of any
Real Property Lease or Other Lease or Contract, and (ii) assume all accounts
payable and accruals incurred by Seller after the Petition Date with respect to
the conduct of the Business and which would qualify as administrative priority
expenses under Section 503(b) of the Bankruptcy Code (collectively, the "Assumed
Liabilities"). Other than the liabilities and obligations of Seller expressly
assumed by Buyer under this Agreement, Buyer is not assuming and shall not be
liable for any liabilities or obligations of Seller.
3. CLOSING OF TRANSACTIONS
3.1 CLOSING
The Closing of the transactions provided for herein (the "Closing") shall take
place at the offices of Xxxxxxx & Xxxxx LLP, 000 Xxxxxx, Xxxxx 0000, Xxxxxxx,
Xxxxx 00000.
Sch. 8.7, Pg. 6
3.2 CLOSING DATE
The Closing shall be held within five US business days after satisfaction or
waiver of the conditions to closing in Section 4 (the "Closing Date") but in no
event later than May 1, 2002 (the "Outside Date"); provided, however, that the
Outside Date shall automatically be extended for consecutive 30 US business day
periods if the only condition remaining to be satisfied is the condition
specified in Section 4.1.7 and 4.2.4. In the event the conditions to Closing
(other than the condition in Section 4.1.7 and 4.2.4) have not been satisfied or
waived by the Outside Date, then any party who is not in default hereunder may
terminate this Agreement. Alternatively, the parties may mutually agree to an
extended Closing Date. Until this Agreement is either terminated or the parties
have agreed upon an extended Closing Date, the parties shall diligently continue
to work to satisfy all conditions to Closing.
3.3 SELLER'S DELIVERIES TO BUYER AT CLOSING
On the Closing Date, Seller shall make the following deliveries to Buyer:
3.3.1 An Assignment and Assumption Agreement substantially in the form and
content attached as EXHIBIT "E" hereto, duly executed by Seller, pursuant
to which Seller assigns the Real Property Leases and the Other Leases and
Contracts (the "Assignment Agreement"); provided, however, that the
Assignment Agreement need not be delivered by Seller if the Bankruptcy
Court has issued an order prior to the Closing Date authorizing the
assumption and assignment of the Real Property Leases and the Other
Leases and Contracts.
3.3.2 A xxxx of sale, duly executed by Seller, substantially in the form and on
the terms of the xxxx of sale attached hereto as EXHIBIT "F," pursuant to
which Seller transfers the Property other than the Real Property Leases
and the Other Leases and Contracts to Buyer (the "Xxxx of Sale").
3.3.3. A special warranty deed duly executed by the Seller, in respect to the
Real Property.
3.3.4 A legal opinion from Seller's counsel confirming Seller's ability to
enter into and perform its obligations under this Agreement.
3.4 BUYER'S DELIVERIES TO SELLER AT CLOSING
On the Closing Date, Buyer shall make or cause the following deliveries to be
made to Seller, to the Warranty Reserve Escrow Agent or to the Working Capital
Escrow Agent:
3.4.1 The remaining portion of the Purchase Price (less the Warranty Reserve
Escrow Amount and Working Capital Escrow Amount) to be delivered and paid
by Buyer to Seller under Section 2.1.
3.4.2 The Deposit and all accrued interest thereon to be paid and delivered to
Seller as provided in Section 2.1.3.
Sch. 8.7, Pg. 7
3.4.3 The Working Capital Escrow Amount to be delivered by Buyer to the Working
Capital Escrow Agent as provided in Section 2.1.3.
3.4.4 The Warranty Reserve Escrow Amount to be delivered to the Warranty
Reserve Escrow Agent as provided in Section 8.7.
3.4.5 The Assignment Agreement, duly executed by Buyer.
3.5 PRORATIONS
Rent, current taxes, prepaid advertising and other items of expense (including,
without limitation, any prepaid insurance under the Real Property Leases or
Other Leases and Contracts, or any of them) and income relating to or
attributable to the Business and/or the Real Property Leases or the Other Leases
and Contracts shall be prorated between Seller and Buyer as of the Closing Date.
Rent shall be prorated on the basis of a thirty (30) day month. Buyer shall pay
to Seller in cash on the Closing Date the amount of any security or similar
deposits with the landlords or other contracting parties under the Real Property
Leases and the Other Leases and Contracts and the amount of any other deposits
made by Seller relating to the Real Property or the property to which the Other
Leases and Contracts relate.
All obligations due in respect of periods prior to Closing shall be paid in full
or otherwise satisfied by Seller and all obligations due in respect of periods
after Closing shall be paid in full or otherwise satisfied by Buyer.
3.6 SALES, USE AND OTHER TAXES
In accordance with Section 1146(c) of the Bankruptcy Code, the making or
delivery of any instrument of transfer, including the filing of any deed or
other document of transfer to evidence, effectuate or perfect the rights,
transfers and conveyances contemplated by this Agreement, shall be in
contemplation of a plan or plans of reorganization to be confirmed in the Case,
and as such shall be free and clear of any and all transfer tax, stamp tax,
motor vehicle title transfer tax or fee or similar taxes. The instruments
transferring the Property to Buyer shall contain the following endorsement, or
an endorsement of similar effect:
"Because this instrument has been authorized pursuant to Order of the
United States Bankruptcy Court for the Southern District of Mississippi, in
contemplation of a plan of reorganization of the Grantor, it is exempt from
transfer taxes, stamp taxes or similar taxes pursuant to 11 U.S.C.
(S) 1146(c)."
In the event that, notwithstanding the above provisions, any (a) real estate
transfer taxes or similar taxes or charges are required to be paid in order to
record the deeds to be delivered to Buyer in accordance herewith, or in the
event any such taxes are assessed at any time thereafter, or (b) sales, use,
transfer or other similar taxes or charges are assessed at Closing or at any
time thereafter on the transfer of any other Property, then in each instance
such taxes or charges incurred as a result of the transactions contemplated
hereby shall be paid by Buyer.
Sch. 8.7, Pg. 8
3.7 POSSESSION
Right to possession of the Property shall transfer to Buyer on the Closing Date.
Seller shall transfer and deliver to Buyer on the Closing Date such keys, lock
and safe combinations and other similar items as Buyer shall require to obtain
immediate and full occupation and control of the Property, and shall also make
available to Buyer at their then existing locations the originals of all
documents in Seller's possession that are required to be transferred to Buyer by
this Agreement.
4. CONDITIONS PRECEDENT TO CLOSING
4.1 CONDITIONS TO SELLER'S OBLIGATIONS
Seller's obligation to make the deliveries required of Seller at the Closing
Date shall be subject to the satisfaction or waiver by Seller of each of the
following conditions.
4.1.1 All of the representations and warranties of Buyer contained herein shall
continue to be true and correct at the Closing in all material respects,
all covenants and obligations to be performed by Buyer prior to the
Closing shall have been performed in all material respects and Buyer
shall have certified the foregoing to Seller in writing.
4.1.2 Buyer shall have executed and delivered to Seller the Assignment
Agreement and each other document reasonably requested by Seller pursuant
to Section 1.3.
4.1.3 Seller shall have received the total Purchase Price, less the Warranty
Reserve Amount and the Working Capital Escrow Amount, in immediately
available funds, and the Warranty Reserve Amount and the Working Capital
Escrow Amount shall have been delivered to the Warranty Reserve Escrow
Agent and the Working Capital Escrow Agent as provided in Section 2.1.3
above.
4.1.4 Buyer shall have delivered to Seller appropriate evidence of all
necessary action by Buyer in connection with the transactions
contemplated hereby, including, without limitation: (i) certified copies
of resolutions duly adopted by Buyer's Board of Directors approving the
transactions contemplated by this Agreement and authorizing the
execution, delivery, and performance by Buyer of this Agreement; and
(ii) a certificate as to the incumbency of officers of Buyer executing
this Agreement and any instrument or other document delivered in
connection with the transactions contemplated by this Agreement.
4.1.5 In the event that Buyer makes any assignment of its rights under this
Agreement to a Subsidiary of Buyer as provided in Section 10.14 below,
Buyer shall have executed and delivered to Seller, concurrently with or
prior to the Closing Date, a guaranty in form and substance satisfactory
to Seller, of all of such Subsidiary of Buyer's obligations under this
Agreement and under any documents executed by such Subsidiary of Buyer in
favor of Seller pursuant hereto.
4.1.6 No action, suit or other proceedings shall be pending before any court,
tribunal or governmental authority seeking or threatening to restrain or
prohibit the consummation of
Sch. 8.7, Pg. 9
the transactions contemplated by this Agreement, or seeking to obtain
substantial damages in respect thereof, or involving a claim that
consummation thereof would result in the violation of any law, decree or
regulation of any governmental authority having appropriate jurisdiction.
4.1.7 The Bankruptcy Court shall have entered the Procedure Order in accordance
with Section 8.4.1 below and the Approval Order and final judgment
thereon in accordance with Section 8.4.2 below and the Approval Order and
final judgement thereon shall not have been stayed as of the Closing
Date.
4.2 CONDITIONS TO BUYER'S OBLIGATIONS
Buyer's obligation to make the deliveries required of Buyer at the Closing shall
be subject to the satisfaction or waiver by Buyer of each of the following
conditions:
4.2.1 All representations and warranties of Seller contained herein shall
continue to be true and correct at the Closing in all material respects,
all covenants and obligations to be performed by Seller prior to the
Closing shall have been performed in all material respects and Seller
shall have certified the foregoing to Buyer in writing.
4.2.2 Seller shall have executed and delivered to Buyer the Assignment
Agreement, the Xxxx of Sale and each other document reasonably requested
by Buyer pursuant to Section 1.3.
4.2.3 No action, suit or other proceedings shall be pending before any court,
tribunal or governmental authority seeking or threatening to restrain or
prohibit the consummation of the transactions contemplated by this
Agreement, or seeking to obtain substantial damages in respect thereof,
or involving a claim that consummation thereof would result in the
violation of any law, decree or regulation of any governmental authority
having appropriate jurisdiction.
4.2.4 The Bankruptcy Court shall have entered the Procedure Order in accordance
with Section 8.4.1 below and the Approval Order and final judgment in
accordance with Section 8.4.2 below and the Approval Order and final
judgment shall not have been stayed as of the Closing Date.
4.2.5 The form and the substance of the Sale Procedure Motion and the Procedure
Order and the form and substance of the Sale Motion and Approval Order
shall have been approved by Buyer. Such approval shall not be
unreasonably withheld.
4.3 TERMINATION
If any of the above conditions is neither satisfied nor waived on or before the
date by which the condition is required to be satisfied, the party who is not
then in default hereunder may terminate this Agreement by delivering to the
other written notice of termination. Any waiver of a condition shall be
effective only if such waiver is stated in writing and signed by the waiving
party; provided, however, that the consent of a party to the Closing shall
constitute a waiver by such party of any conditions to Closing not satisfied as
of the Closing Date.
Sch. 8.7, Xx. 00
0. SELLER'S REPRESENTATIONS AND WARRANTIES
Seller hereby makes the following representations and warranties to Buyer:
5.1 VALIDITY OF AGREEMENT
Upon obtaining the Approval Order, this Agreement shall constitute the valid and
binding obligation of Seller enforceable in accordance with its terms.
5.2 ORGANIZATION, STANDING AND POWER
Seller consists of corporations duly organized, validly existing and in good
standing under the laws of the States of their respective organization. Subject
to the applicable provisions of bankruptcy law, Seller has all requisite
corporate power and authority to own, lease and operate its properties, to carry
on its business as now being conducted and, subject to the Seller's obtaining
the Approval Order, to execute, deliver and perform this Agreement and all
writings relating hereto.
5.3 NO CONFLICTS OR VIOLATIONS
Upon obtaining the Approval Order, the execution and delivery of this Agreement,
the consummation of the transactions herein contemplated, and the performance
of, fulfillment of and compliance with the terms and conditions hereof by Seller
do not and will not: (i) conflict with or result in a breach of the articles of
incorporation or the by-laws of Seller; (ii) violate any statute, law, rule or
regulation, or any order, writ, injunction or decree of any court or
governmental authority; or (iii) violate or conflict with or constitute a
default under any agreement, instrument or writing of any nature to which Seller
is a party or by which Seller or its assets or properties may be bound.
5.4 TITLE TO PROPERTY
To the Seller's knowledge (which consists of matters actually known to Seller's
senior management), Seller has good and marketable title to the Property;
provided, however, Seller makes no representation whatsoever as the title to the
Intangible Property. At the Closing, Buyer will acquire all of Seller's right,
title and interest in and to all the Property, free and clear of any liens,
claims or encumbrances, subject to Sections 2.3 and 3.5 hereof.
6. BUYER'S REPRESENTATIONS AND WARRANTIES
Buyer hereby makes the following representations and warranties to Seller:
6.1 VALIDITY OF AGREEMENT.
All action on the part of Buyer necessary for the authorization, execution,
delivery and performance of this Agreement by Buyer, including, but not limited
to, the performance of Buyer's obligations hereunder, has been duly taken. This
Agreement, when executed and delivered by Buyer, shall constitute the valid and
binding obligation of Buyer enforceable in accordance with its terms.
Sch. 8.7, Pg. 11
6.2 ORGANIZATION, STANDING AND POWER
Each of Buyer and any Subsidiary of Buyer as contemplated in Section 10.14 is a
corporation duly organized, validly existing and in good standing under the laws
of the jurisdiction of its organization and has all requisite corporate power
and authority to own, lease and operate its properties, to carry on its business
as now being conducted and to execute, deliver and perform this Agreement and
all writings relating hereto.
6.3 NO CONFLICTS OR VIOLATIONS
The execution and delivery of this Agreement, the consummation of the
transactions herein contemplated, and the performance of, fulfillment of and
compliance with the terms and conditions hereof by Buyer do not and will not:
(i) conflict with or result in a breach of the articles of incorporation or by-
laws of Buyer; (ii) violate any statute, law, rule or regulation, or any order,
writ, injunction or decree of any court or governmental authority; or (iii)
violate or conflict with or constitute a default under any agreement, instrument
or writing of any nature to which Buyer is a party or by which Buyer or its
assets or properties may be bound.
6.4 FINANCING
Buyer has sufficient funds available to consummate the transactions contemplated
hereby.
7. "AS IS" TRANSACTION
Buyer hereby acknowledges and agrees that, except as otherwise expressly
provided in Section 5 above, the Seller makes no representations or warranties
whatsoever, express or implied, with respect to any matter relating to the
Property including, without limitation, income to be derived or sensed to be
incurred in connection with the Property, the physical condition of any personal
property comprising a part of the Property or which is the subject of any other
lease or contract to be assumed by Buyer at the closing, the environmental
condition or other matter relating to the physical condition of any real
property or improvements which are the subject of any real property lease to be
assumed by Buyer at the closing, the zoning of any such real property or
improvements, the value of the Property (or any portion thereof), the
transferability of Property, the terms, amount, validity or enforceability of
any assumed liabilities, the title of the Property (or any portion thereof) the
merchantability or fitness of the personal property or any other portion of the
Property for any particular purpose, or any other matter or thing relating to
the Property of any portion thereof. Without in any way limiting the foregoing,
Seller hereby disclaims any warranty, express or implied, of merchantability or
fitness for any particular purpose as to any portion of the Property. Buyer
further acknowledges that Buyer has conducted an independent inspection and
investigation of the physical condition of the Property and all such other
matters relating to or affecting the Property as Buyer deemed necessary or
appropriate and that in proceeding with its acquisition of the Property, except
for any representations and warranties expressly set forth in Section 5, Buyer
is doing so based solely upon such independent inspections and investigations.
ACCORDINGLY, BUYER WILL ACCEPT THE PROPERTY AT THE CLOSING "AS IS", "WHERE IS"
AND "WITH ALL FAULTS".
Sch. 8.7, Xx. 00
0. COVENANTS PRIOR TO CLOSING
8.1 ACCESS TO RECORDS AND PROPERTIES OF SELLER
From and after the date of this Agreement until the Closing Date, Seller shall,
upon reasonable advance notice, afford to Buyer's officers, independent public
accountants, counsel, lenders, consultants and other representatives, reasonable
access during normal business hours to the Property and all records pertaining
to the Property or the Business. Buyer, however, shall not be entitled to access
to any materials containing information in respect of any items excluded from
the Intangible Property under Section 1.1.4. Buyer shall have the right, at its
own cost, to conduct an environmental inspection of the Facilities of Seller as
provided in Section 8.3 below to enable Buyer to make the decision with respect
to such Facilities as provided in Section 1.1.2. Buyer expressly acknowledges
that nothing in this Section 8.1 is intended to give rise to any contingency to
Buyer's obligations to proceed with the transactions contemplated herein.
8.2 OPERATION OF SELLER'S BUSINESS PENDING CLOSING
Unless Buyer otherwise consents, during the period prior to the Closing Date,
Seller shall use commercially reasonable efforts to operate the Business as
currently operated and only in the ordinary course and, consistent with such
operation, shall use commercially reasonable efforts to preserve intact the
Business and its relationships with employees and persons having dealings with
it. During the period prior to the Closing Date, Seller shall consult with Buyer
with respect to any new customer projects under consideration by the Business
and shall not enter into any material contracts with respect to any customer
projects not in existence on the Execution Date without Buyer's consent, which
consent shall not be unreasonably withheld.
8.3 ENVIRONMENTAL INVESTIGATION BY BUYER
Prior to March 8, 2002, at a time or times mutually convenient for Buyer and
Seller, Buyer, together with its environmental consultant, may, at Buyer's cost,
conduct an environmental investigation of any of Seller's facilities located at
00000 Xxxx Xxxx Xxxx, Xxxxxxxxx, Xxxxxxxxx (the "Covington Facility"), 00000
Xxxxxxx Xxxx, Xxxxxxx, Xxxxxxxxx (the "Cabiran Facility") and 000 Xxxxxxx Xxxxx
Xxxx, Xxxxxxx, Xxxxxxxxx (the "Liberty Bayou Facility") (collectively, the
"Facilities"), consisting of a visual inspection, obtaining of samples and
document review. Seller shall provide to Buyer: (a) all material documents
pertaining to environmental matters reasonably requested by Buyer, and (b) the
opportunity to tour the Facilities with an individual knowledgeable about their
operations. Buyer agrees to provide Seller with drafts of any reports
concerning the environmental investigation of the Facilities that are generated
by, or on behalf of, Buyer. Prior to finalization of such reports, Seller shall
have the opportunity to review the drafts to within five business days of
receipt of the drafts and to identify in writing any factual inaccuracies (in
the view of Seller) therein. If such written comments are received from the
Seller they may either be implemented in the final reports or enclosed to the
final reports in Buyer's or it's consultant sole discretion. Buyer or its
consultant may take reasonable soil and/or water samples from the Facilities.
Notwithstanding the foregoing, Buyer may not conduct any subsurface testing or
drilling on the Facilities unless specifically provided for in a scope of work
which has been approved by Seller in writing and such approval shall not be
unreasonably withheld by Seller. Seller shall have the right to approve any
contractors or subcontractors
Sch. 8.7, Pg. 13
retained by Buyer to perform sampling in respect of the Facilities and such
approval shall not be unreasonably withheld by Seller. Each such contractor or
subcontractor shall have liability insurance coverage of a type and amount
acceptable to Seller, and Buyer will require that Seller be named as an
additional insured on such policies. Buyer shall notify Seller not less than
five (5) business days in advance of making any such inspection and shall inform
Seller of the names of the company and persons who will conduct such inspection.
Seller reserves the right to have a representative present at the time of such
inspection. Buyer shall make all inspections in good faith and with due
diligence and splits of all samples taken for analysis shall be made available
to Seller immediately upon Seller's request. Buyer agrees to (i) return the
Facilities to the same condition in which they were prior to Buyer's making any
inspection and (ii) comply with all applicable laws and regulations regarding
installation, plugging, and abandonment of any well or boring. Buyer will treat,
and will cause any representative of Buyer to treat, all information obtained by
Buyer pursuant to the foregoing environmental investigation as strictly
confidential information and will not disclose such information or the results
of any environmental investigation or audit without the prior written consent of
Seller, except as required by applicable law. In the event disclosure may be
required by applicable law, Buyer shall immediately provide notice to Seller,
and Seller may assert applicable privileges or seek protective orders to present
such disclosure. Buyer agrees to indemnify, defend and hold harmless Seller,
together with their officers, shareholders, directors, employees and agents,
individually and collectively, from and against any and all liabilities and
responsibilities, claims, suits, losses, and other causes of action recognized
now or at any later time, together with all damages, settlements, costs,
expenses, charges, assessments, liens, penalties, fines, prejudgment and post
judgment interest, legal fees, costs of defense, and costs of court arising out
of or resulting from performance of the environmental investigation performed by
Buyer, its employees, consultants, representatives and agents. All notices,
reports, requests for approval and communications of any sort pursuant to this
Section 8.3 or otherwise in connection with the subject matter of this Section
8.3 shall be sent to Seller only through their counsel at the following address,
phone and fax numbers:
Xxxxxxx & Xxxxx
Mayor, Day, Xxxxxxxx & Xxxxxx, L.L.P
000 Xxxxxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
Attn: Xxxxxxxx Xxxx
Phone: 713/000-0000
Facsimile: 713/225-7047
8.4 BANKRUPTCY COURT APPROVALS
8.4.1 Bankruptcy Court Approval of Sale Procedures
Promptly following the Execution Date (and in no event later than ten (10)
business days thereafter), the Seller will file a motion (the "Sale Procedure
Motion") with the Bankruptcy Court requesting the entry of an order (the
"Procedure Order") (i) fixing the time, date, and location of a hearing (the
"Approval Hearing") to approve Seller's consummation of this agreement,
(ii) fixing the time and date of an auction (the "Auction") to be held at the
offices of Xxxxxxx & Xxxxx, L.L.P. at which higher and better offers may be
presented to the Seller, (iii) providing that if Seller receives from a third
party a higher and better offer at the Auction, and
Sch. 8.7, Pg. 14
such third party offer is subsequently approved by the Bankruptcy Court and
closes as provided by its terms, then Buyer will be entitled to receive from the
Seller a flat fee payment (not dependent on amounts actually expended or
incurred by Buyer) in cash or other immediately available good funds in the
amount of US $1,000,000 (United States Dollars One Million 00/100) (the "Break-
Up Fee") which payment shall be paid to the Buyer concurrently with the
consummation of such third party sale, (iv) providing that no prospective
purchaser will be permitted to bid at the Auction unless such party has been
deemed "financially qualified" by Xxxxxxxx Xxxxx Xxxxxx & Xxxxx Capital
("HLHZ"), Seller's investment banker, (v) providing that no prospective
purchaser who bids for the Property at Auction shall be entitled to purchase the
Property unless such prospective purchaser offers to purchase the Property for
consideration which is at least US $1,500,000 (United States Dollars One Million
Five Hundred Thousand 00/100) greater than the consideration set forth in this
Agreement (including all cash, non-cash consideration and assumed liabilities)
and otherwise on terms at least as favorable to the Seller as those set forth in
this Agreement, and (vi) providing that after any initial overbid, all further
overbids must be in increments of at least $500,000 (United States Dollars Five
Hundred Thousand 00/100), that should overbidding take place, the Buyer shall
have the right, but not the obligation, to participate in the overbidding and to
be approved as the overbidder at the Approval Hearing based upon any such
overbid, and that should an overbidder be approved at the hearing on the Sale
Motion, Buyer shall deliver to such approved overbidder all third party reports,
studies and the like resulting from Buyer's due diligence investigations, and
(vii) approving the form, manner, scope, and substance of notice regarding the
proposed sale and Auction, including overbid procedures. The form and substance
of the Sale Procedure Motion and the Procedure Order shall be reasonably
acceptable to Buyer and shall be provided to Buyer prior to filing of same with
the Bankruptcy Court. Following the filing of the Sale Procedure Motion, the
Seller shall use reasonable efforts to obtain the Procedure Order (the date on
which the Procedure Order is entered and becomes final is referred to herein as
the "Sale Procedure Date").
8.4.2 Bankruptcy Court's Approval of Sale
Promptly following the Execution Date, and contemporaneously with the filing of
the Sale Procedure Motion, Seller shall file a motion with the Bankruptcy Court
(the "Sale Motion") requesting entry of an order (the "Approval Order") and
final judgment thereon which (i) approves the sale of the Property to Buyer on
the terms and conditions set forth in this Agreement and authorizes the Seller
to proceed with this transaction, (ii) includes a specific finding that Buyer is
a good faith purchaser of the Property as contemplated by Section 363(m) of the
United States Bankruptcy Code, (iii) states that the sale of the Property to
Buyer shall be free and clear of all liens, claims, interests and encumbrances
whatsoever (except as expressly provided in this Agreement), and (iv) approves
the Seller's assumption and assignment of the pre-petition Real Property Leases
and Other Leases and Contracts (collectively, the "Section 365 Contracts")
pursuant to Xxxxxxx 000 xx xxx Xxxxxx Xxxxxx Bankruptcy Code and orders the
Buyer to pay any cure amounts payable to the other parties to the Section 365
Contracts as a condition to such assumption and assignment. In no event shall
Buyer have the right to terminate this transaction by reason of the failure to
assign all of the Section 365 Contracts so long as the Approval Order authorizes
the Seller to assume and assign not less than ninety five percent (95%) of the
Section 365 Contracts. The form and substance of the Sale Motion and Approval
Order and final judgment thereon shall be reasonably acceptable to Buyer and
shall be provided to Buyer prior to filing of the Sale Procedure Order with the
Bankruptcy Court. Following the
Sch. 8.7, Pg. 15
filing of the Sale Motion, the Seller shall use reasonable efforts to obtain
entry of the Approval Order. Both Buyer's and Seller's obligations to consummate
the transactions contemplated in this Agreement which the Buyer and Seller may
hereafter enter into shall be conditioned upon the Bankruptcy Court's entry of
the Approval Order.
8.5 TRANSITION SERVICES AGREEMENT
At the Closing, Seller and Buyer shall enter into a Transition Services
Agreement in form and substance mutually satisfactory to Buyer and Seller,
pursuant to which Seller shall provide or cause to be provided to Buyer, at
Buyer's cost, accounting and data processing services and support services for a
period not to exceed ninety (90) days after the Closing Date.
8.6 TRANSITION LEASE AGREEMENT
In the event that Buyer elects not to acquire a Facility or Facilities as
provided in Section 1.1.2 above, Buyer and Seller shall enter into a lease
agreement, on the Closing Date, with respect to such Facility or Facilities in
form and substance mutually satisfactory to Buyer and Seller for such term not
to exceed August 31, 2002 as may be necessary for Buyer to complete or relocate,
at Buyer's cost, work-in-progress at such Facility or Facilities on the Closing
Date.
8.7 WARRANTY RESERVE ESCROW
On the Closing Date, Seller shall identify to Buyer in writing those customer
contracts listed on Schedule 8.7 attached hereto (other than any such contracts
which are Excluded Assets as provided on Exhibit D) which are more than 80%
complete on the Closing Date (the "Warranty Reserve Contracts"). At the
Closing, Buyer shall deliver an amount of the Purchase Price equal to one-and-
one-half percent (1.5%) of the aggregate contract price of the Warranty Reserve
Contracts, determined in accordance with the most recent Percent of Completion
Report of the Business (the "Warranty Reserve Amount") to an escrow account (the
"Warranty Reserve Escrow Account") governed by an escrow agreement (the
"Warranty Reserve Escrow Agreement") mutually acceptable to Buyer and Seller,
dated the Closing Date, by and among Seller, Buyer and an escrow agent mutually
agreed upon by Buyer and Seller (the "Warranty Reserve Escrow Agent"). The
Warranty Reserve Amount shall be available to reimburse Buyer in accordance with
the Warranty Reserve Escrow Agreement for warranty claims brought by customers
under the Warranty Reserve Contracts during the period beginning on the Closing
Date and ending on the expiration date of the last to expire of the warranty
periods provided for in the Warranty Reserve Contracts (the "Escrow Termination
Date"). Any portion of the Warranty Reserve Escrow Amount remaining on the
Escrow Termination Date (other than amounts necessary to cover any pending
claims) shall promptly be disbursed to Seller together with all interest accrued
thereon. The Warranty Reserve Escrow Agent's escrow fees and charges shall be
paid one-half by Seller and one-half by Buyer, in which respect the Seller and
the Buyer shall not be jointly liable since each shall only be liable for its
own part (one-half) of the said fees and charges.
Sch. 8.7, Pg. 16
8.8 FURTHER ACTIONS
The Parties each agree to use all commercially reasonable efforts to take all
actions and to do all things necessary, proper or advisable to consummate the
transactions contemplated hereby by the expected Closing Date.
9. POST CLOSING COVENANTS
9.1 POST-CLOSING MAINTENANCE OF AND ACCESS TO INFORMATION
Without limiting Seller's rights under Section 10.2 with respect to the Case,
Buyer will also comply with the following provisions:
(a) The parties acknowledge that after Closing Seller or its successors may
need access to information or documents in the control or possession of
Buyer for the purposes of concluding the transactions herein contemplated,
preparing or filing tax returns or responding to audits, Contracts and to
satisfy other legal requirements, and to prosecute or defend claims against
or by third parties.
(b) Buyer shall not dispose of or destroy any of the records and files of the
Business prior to the fourth anniversary of the Closing Date. If Buyer
wishes to dispose of or destroy such records and files after that time, it
shall first give sixty (60) days' prior written notice to Seller, and
Seller shall have the right, at its option and expense, upon prior written
notice to Buyer within such sixty-day period, to take possession of the
records and files within ninety (90) days after the date of the notice from
Seller.
(c) Buyer shall cooperate fully in connection with, and make available for
inspection and copying by, Seller, its successors, and their respective
employees, agents, counsel and accountants and/or governmental authorities,
upon written request, such books, records documents and other information
to the extent reasonably necessary to facilitate the purposes set forth in
subsection (a) above and for other legitimate corporate purposes. In
addition, Buyer shall cooperate with, and shall permit and use its best
efforts to cause, its former and present directors, officers and employees
to cooperate with, Seller on and after Closing in furnishing information,
evidence, testimony and other assistance in connection with any action,
proceeding, arrangement or dispute of any nature with respect to the
Business or the Property and pertaining to periods prior to the Closing
Date.
(d) Seller shall be entitled to retain any records that relate to events or
periods prior to Closing for purposes of pending litigation involving
matters to which such records refer.
9.2 WARN ACT AND EMPLOYMENT MATTERS
Upon Closing Seller shall terminate all employees engaged in the Business. It is
the intent of Buyer to make offers of employment to substantially all of the
terminated employees of Seller in St. Xxxx, Minnesota and to certain terminated
employees of Seller at the other Facilities acquired by Buyer hereunder,
provided, however, that Buyer intends to conduct customary employee background
checks prior to offering employment to any such employee. Buyer will grant to
all
Sch. 8.7, Pg. 17
employees of Seller who become employees of Buyer as contemplated hereby
(the "Transferred Employees") service credit for previous service recognized by
Seller for purposes of vacation, pay, bonuses, promotion and all other plans,
policies or programs of Buyer where such service is relevant. From and after
the Closing Date, Buyer will assume and be liable for any accrued vacation and
sick leave obligations of Seller to the Transferred Employees.
Buyer shall be responsible for and shall pay any and all liabilities or
obligations arising under the WARN Act, if any, arising out of or resulting from
layoffs of employees or any termination of their employment in the Business in
connection with the transactions provided herein. Buyer shall further be liable
for any obligation imposed on either Seller or Buyer to provide employees with
continued health, disability, life or other retirement benefits (whether covered
by insurance or not). Buyer agrees to indemnify, and hold Seller and its
successors harmless from or against, any and all claims, losses, damages,
expenses, obligations and liabilities (including costs of collection, attorney's
fees and other costs of defense) which Seller may incur in connection with any
suit or claim of violation brought against Seller under the WARN Act or any
similar state or foreign law, which relates to transactions effected in
connection with the transactions provided herein or any other action taken by
Buyer after the Closing Date with regard to any site of employment or one or
more facilities or operating units within any site of employment of the
Business.
9.3 EXCLUDED RECEIVABLES.
From and after the Closing Date, Buyer shall collect the Excluded Receivables
for the benefit of Seller in accordance with Buyer's normal business practices
(but without obligation to initiate any litigation or other proceedings). Buyer
shall promptly, but in no event less frequently than weekly, remit to Seller (i)
all amounts received by Buyer in payment of the Excluded Receivables and (ii)
any other amounts received by Buyer from any obligor of an Excluded Receivable,
whether in payment for any Receivable acquired by Buyer hereunder or with
respect to accounts receivable generated by the Business after the Closing Date,
which amounts shall first be applied to the payment of any outstanding Excluded
Receivable of such obligor. Buyer shall at, Seller's request, provide Seller
with reasonable access during normal business hours to all records relating to
the Excluded Receivables, the Receivables acquired by Buyer hereunder, and
accounts receivable generated after the Closing Date, for the purpose of
auditing the collection and remittance of the Excluded Receivables as provided
herein.
10. MISCELLANEOUS
10.1 ATTORNEYS' FEES
In the event that either party hereto brings an action or other proceeding to
enforce or interpret the terms and provisions of this Agreement, the prevailing
party in that action or proceeding shall be entitled to have and recover from
the non-prevailing party all such fees, costs and expenses (including, without
limitation, all court costs and reasonable attorneys' fees) as the prevailing
party may suffer or incur in the pursuit or defense of such action or
proceeding.
Sch. 8.7, Pg. 18
10.2 REASONABLE ACCESS TO RECORDS AND CERTAIN PERSONNEL
So long as the Case is pending, (i) the Buyer shall permit Seller's counsel and
other professionals employed in the Case reasonable access to the financial and
other books and records relating to the Property or the Business (whether in
documentary or data form) for the purpose of the continuing administration of
the Case (including, without limitation, the pursuit of any avoidance,
preference or similar action), which access shall include (a) the right of such
professionals to copy, at the Seller's expense, such documents and records as
they may request in furtherance of the purposes described above, and (b) Buyer's
copying and delivering to Seller or its professionals such documents or records
as they may request, but only to the extent Seller or its professionals
furnishes Buyer with reasonably detailed written descriptions of the materials
to be so copied and Seller reimburses the Buyer for the reasonable costs and
expenses thereof), and (ii) Buyer shall provide the Seller and such
professionals (at no cost to the Seller) with reasonable access to Xxxxxxx
Xxxxxxx, Xxxxx Xxxxxxxxx, Xxxxxx Xxxxxxxx, and such other employees as seller
may reasonably request, during regular business hours to assist the Seller in
the continuing administration of the Case, provided that such access does not
unreasonably interfere with the Buyer's business operations.
10.3 NOTICES
Unless otherwise provided herein, any notice, tender, or delivery to be given
hereunder by either party to the other may be effected by personal delivery in
writing, or by registered or certified mail, postage prepaid, return receipt
requested, and shall be deemed communicated as of the date of mailing. Mailed
notices shall be addressed as set forth below, but each party may change his
address by written notice in accordance with this paragraph.
To Seller: Xxxxxx Xxxxxxx Halter, Inc.
00000 Xxxxxx Xxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
Phone: 000-000-0000
Fax: 000-000-0000
Attn: Xxxx Xxxxxx
With a copy to: Xxxxxxx & Xxxxx LLP
000 Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000-0000
Phone: 000-000-0000
Fax: 000-000-0000
Attn: Xxxx Xxxxxx
And
Sch. 8.7, Pg. 19
Xxxxxxxx Xxxxx Xxxxxx & Xxxxx
0000 Xxxxxxxx Xxxx, Xxxxx 000
Xxxxxxx, Xxxxxxx 00000
Phone: 000-000-0000
Fax: 000-000-0000
Attn: Xxxxx X. Xxxxxx
To Buyer: Hydralift ASA
Servicebox 401
4604 Kristiansand
Norway
Attn: Xxxxxx Xxxxx, Chief Executive Officer
With a copy to: XXXXXXX XXXXXX WINTER & STENNIS, P.A.
X.X. Xxx 000
000 Xxxxx Xxxxx Xxxxxx (39202)
Xxxxxxx, XX 00000-0000
(000) 000-0000
Fax: (000) 000-0000
Attn: Xxxxxxx X. Xxxxxx
10.4 ENTIRE AGREEMENT
This instrument and the documents to be executed pursuant hereto contain the
entire agreement between the parties relating to the sale of the Property. Any
oral representations or modifications concerning this Agreement or any such
other document shall be of no force and effect excepting a subsequent
modification in writing, signed by the party to be charged.
10.5 MODIFICATION
This Agreement may be modified, amended or supplemented only by a written
instrument duly executed by all the parties hereto.
10.6 CLOSING DATE
All actions to be taken on the Closing pursuant to this Agreement shall be
deemed to have occurred simultaneously, and no act, document or transaction
shall be deemed to have been taken, delivered or effected until all such
actions, documents and transactions have been taken, delivered or effected.
10.7 SEVERABILITY
Should any term, provision or paragraph of this Agreement be determined to be
illegal or void or of no force and effect, the balance of the Agreement shall
survive except that, if Buyer cannot acquire and Seller cannot sell
substantially all of the Property, either party may terminate this Agreement,
and it shall be of no further force and effect, unless both parties agree in
writing to the contrary.
Sch. 8.7, Pg. 20
10.8 CAPTIONS
All captions and headings contained in this Agreement are for convenience of
reference only and shall not be construed to limit or extend the terms or
conditions of this Agreement.
10.9 FURTHER ASSURANCES
Each party hereto will execute, acknowledge and deliver any further assurance,
documents and instruments reasonably requested by any other party hereto for the
purpose of giving effect to the transactions contemplated herein or the
intentions of the parties with respect thereto.
10.10 WAIVER
No waiver of any of the provisions of this Agreement shall be deemed, or shall
constitute, a waiver of other provisions, whether or not similar, nor shall any
waiver constitute a continuing waiver. No waiver shall be binding unless
executed in writing by the party making the waiver.
10.11 BROKERAGE OBLIGATIONS
Seller is represented by HLHZ as its exclusive sale agent with respect to the
transactions contemplated herein pursuant that certain order entered by the
Bankruptcy Court on October 30, 2001 and HLHZ's commission, fees and expenses
are to be paid by the Seller in accordance with the terms and provisions of such
order. The Seller and the Buyer each represent and warrant to the other that,
except for HLHZ, such party has incurred no liability to any real estate broker
or agent with respect to the payment of any commission regarding the
consummation of the transaction contemplated hereby. Except for any claims of
HLHZ (which are to be handled and satisfied by Seller in accordance with the
above referenced order), it is agreed that if any claims for commissions, fees
or other compensation, including, without limitation, brokerage fees, finder's
fees, or commissions are ever asserted against Buyer or the Seller in connection
with this transaction, all such claims shall be handled and paid by the party
whose actions form the basis of such claim and such party shall indemnify,
defend (with counsel reasonably satisfactory to the party entitled to
indemnification), protect, and save and hold the other harmless from and against
any and all such claims or demands asserted by any person, firm or corporation
in connection with the transaction contemplated hereby.
10.12 PAYMENT OF FEES AND EXPENSES
Except as provided in Section 9.2 above, each party to this Agreement shall be
responsible for, and shall pay, all of its own fees and expenses, including
those of its counsel, incurred in the negotiation, preparation and consummation
of the Agreement and the transaction described herein.
10.13 SURVIVAL
Except for the covenants and agreements that are expressly provided to be
performed after the Closing Date, none of the respective representations,
warranties, covenants and agreements of Seller and Buyer herein, or in any
certificates or other documents delivered prior to or at the Closing, shall
survive the Closing.
Sch. 8.7, Pg. 21
10.14 ASSIGNMENTS
This Agreement shall not be assigned by either party hereto without the prior
written consent of the other party hereto; provided, however, that Buyer may
assign its rights hereunder without such consent to a corporation or other
entity wholly-owned, directly or indirectly, by Buyer (a "Subsidiary of Buyer")
and provided further that any such assignment shall not release Buyer from any
of its obligations under this Agreement. Buyer will provide prompt written
notice of any such assignment to Seller.
10.15 BINDING EFFECT
Subject to the provisions of Section 10.14 above, this Agreement shall bind and
inure to the benefit of the respective heirs, personal representatives,
successors, and assigns of the parties hereto.
10.16 APPLICABLE LAW
This Agreement shall be governed by and construed in accordance with the laws of
Mississippi.
10.17 GOOD FAITH
All parties hereto agree to do all acts and execute all documents required to
carry out the terms of this Agreement and to act in good faith with respect to
the terms and conditions contained herein before and after Closing.
10.18 CONSTRUCTION
In the interpretation and construction of this Agreement, the parties
acknowledge that the terms hereof reflect extensive negotiations between the
parties and that this Agreement shall not be deemed, for the purpose of
construction and interpretation, drafted by either party hereto.
10.19 COUNTERPARTS
This Agreement may be signed in counterparts. The parties further agree that
this Agreement may be executed by the exchange of facsimile signature pages.
10.20 TIME IS OF THE ESSENCE
Time is of the essence in this Agreement, and all of the terms, covenants and
conditions hereof.
10.21 TAX EFFECT
None of the parties (nor such parties' counsel or accountants) has made or is
making in this Agreement any representation to any other party (or such party's
counsel or accountants) concerning any of the tax effects or consequences on the
other party of the transactions provided for in this Agreement. Each party
represents that it has obtained, or may obtain, independent tax advice with
respect thereto and upon which it, if so obtained, has solely relied.
Sch. 8.7, Pg. 22
10.22 EMPLOYEE WITHHOLDING
The parties agree that, pursuant to the "Alternative Procedure" provided in
Section 5 of Revenue Procedure 96-60, 1996-2 C.B. 399, with respect to filing
and furnishing IRS Forms W-2, W-3, and 941, (a) Seller shall report on a
"predecessor-successor" basis, as set forth therein, (b) Seller shall be
relieved from furnishing Forms W-2 to any of the employees of Seller who become
employees of Buyer, and (c) Buyer shall assume the obligations of Seller to
furnish such Forms W-2 to such employees for the year in which the Closing
occurs.
10.23 BANKRUPTCY COURT JURISDICTION
Buyer and Seller agree that the Bankruptcy Court shall have exclusive
jurisdiction over all disputes in any way relating to the sale and other matters
relating; to (i) the interpretation and enforcement of this Agreement or any
ancillary document executed pursuant hereto; and/or (ii) the Property and/or
assumed liabilities, and Buyer expressly consents to and agrees not to contest
such exclusive jurisdiction.
10.24 CONFIDENTIALITY AGREEMENT
The Confidentiality Agreement dated as of October 28, 2001 between Buyer and
Seller (the "Confidentiality Agreement") shall remain in full force and effect
during the term specified therein.
[REMAINDER OF PAGE INTENTIONALLY BLANK]
Sch. 8.7, Pg. 23
IN WITNESS WHEREOF, the parties hereto have executed this Asset Purchase
Agreement as of the day and year first above written.
HYDRALIFT ASA,
By: /s/ Xxxxxx Xxxxx
----------------
Name: Xxxxxx Xxxxx
Title: CEO
XXXXXX XXXXXXX HALTER, INC.
By: /s/ Xxxx X. Xxxxxx
------------------
Name: Xxxx X. Xxxxxx
Title: President & CEO
AMCLYDE ENGINEERED PRODUCTS COMPANY, INC.
By: /s/ Xxxx X. Xxxxxx
------------------
Name: Xxxx X. Xxxxxx
Title: CEO
XXXXX XXXXXX, INC.
By: /s/ Xxxx X. Xxxxxx
------------------
Name: Xxxx X. Xxxxxx
Title: CEO
UTILITY STEEL FABRICATION, INC.
By: /s/ Xxxx X. Xxxxxx
------------------
Name: Xxxx X. Xxxxxx
Title: CEO
XXXXXX XXXXXXX HALTER
ENGINEERED PRODUCTS GROUP INC.
By: /s/ Xxxx X. Xxxxxx
------------------
Name: Xxxx X. Xxxxxx
Title: Executive Vice President
HALTER MARINE, INC.
By: /s/ Xxxx X. Xxxxxx
------------------
Name: Xxxx X. Xxxxxx
Title: CEO
Sch. 8.7, Pg. 24
