STOCK PURCHASE AGREEMENT
THIS STOCK PURCHASE AGREEMENT (this "Agreement") is made
and entered into December 29, 1995, by and between SYRATECH
CORPORATION, a Delaware corporation ("Buyer"), XXXXXXXX
PRECISION METALS, INC., a Delaware corporation ("Xxxxxxxx"),
and KATY INDUSTRIES, INC., a Delaware corporation ("Katy").
Xxxxxxxx and Katy are hereinafter sometimes collectively
referred to as "Sellers".
RECITALS:
X. Xxxxxxxx owns all ninety-six (96) issued and
outstanding shares (the "Shares") of WSC Liquidating, Inc., a
Connecticut corporation ("WSCL"). In turn WSCL owns two
million five hundred fifty-five thousand five hundred
(2,555,500) shares of Syratech Corporation Common Stock, par
value $0.01 a share (the "Syratech Shares").
B. Buyer desires to purchase from Xxxxxxxx, and Xxxxxxxx
desires to sell to Buyer, all of the Shares on the terms and
conditions contained in this Agreement.
C. To induce Buyer to enter into and consummate the
transaction contemplated herein, Katy, as the parent of
Xxxxxxxx, which will indirectly benefit from the transaction,
desires to join Xxxxxxxx in certain representations, warranties
and indemnities with respect to the Shares and WSCL.
NOW, THEREFORE, Seller and Buyer, in consideration of the
mutual covenants and warranties contained herein, and for other
good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, agree as follows:
ARTICLE I
PURCHASE AND SALE
Subject to the terms and condition set forth herein, and
in reliance on the representations and warranties contained
herein, Buyer agrees to purchase from Xxxxxxxx, and Xxxxxxxx
agrees to sell to Buyer, the Shares.
ARTICLE II
PURCHASE PRICE: THE CLOSING
2.1 Purchase Price. The purchase price (the "Purchase
Price") for all of the Shares shall be Four Million One Hundred
Six Thousand Three Hundred Three Dollars ($4,106,303).
2.2 Closing and Closing Date. The transaction
contemplated hereby shall be consummated and closed at the
office of Xxxxxx & Coff, Suite 4100, 00 Xxxx Xxxxxx Xxxxxx,
Xxxxxxx, Xxxxxxxx, 00000-0000, on December 29, 1995, at 5:00
p.m. Chicago Time (the "Closing"). The date on which the
Closing occurs is the "Closing Date".
2.3 Sellers' Obligations at Closing. At the Closing,
Katy shall cause Xxxxxxxx to deliver, and Xxxxxxxx shall
deliver, to Buyer the following:
(a) Certificates evidencing the Shares duly endorsed
in blank or accompanied by duly executed stock powers;
(b) Resignation of WSCL's board of directors and
officers;
(c) True and complete copies of the agreement with
Northern Trust Company, an Illinois banking corporation
("Northern Trust") pursuant to which on December 27, 1995
Northern Trust made a loan (the "Loan") to WSCL (the unpaid
principal amount of which on, and accrued interest to, the date
hereof aggregates $39,300,089) and all security agreements and
other documents related or collateral thereto, certified as
such by an officer of each of Xxxxxxxx and Katy.
(d) The opinion of Messrs. Xxxxxx & Coff to the
effect set forth in Exhibit A annexed hereto; and
(e) Any other items required to be delivered by
Xxxxxxxx or Katy under the terms and provisions of this
Agreement.
2.4 Buyer's Obligations at Closing. At the Closing,
Buyer shall deliver to Xxxxxxxx the following:
(a) The Purchase Price (less the Credit provided for
in Article V) which shall be paid by delivery of Buyer's
promissory note, dated as of the Closing Date, payable to the
order of Xxxxxxxx, which shall mature and become due and
payable at the close of business on January 2, 1996 and shall
bear interest at the rate of 5.51% per annum (computed on the
basis of a 365 day year). The promissory note shall be in the
amount of Three Million Seven Hundred Eighty-Six Thousand Eight
Hundred Sixty-Five and 50/100 Dollars ($3,786,865.50), i.e., an
amount equal to the Purchase Price minus the Credit provided
for in Article V.
(b) Any other items to be delivered by Buyer under
the terms and provisions of this Agreement.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF KATY AND SELLER
Katy and Seller jointly and severally represent and
warrant to Buyer as follows:
3.1 Authority. Xxxxxxxx and Katy are each corporations
duly organized, validly existing and in good standing under the
laws of Delaware. Each has all requisite corporate power and
authority to own, lease and operate its properties and to carry
on its business as now being conducted, and to enter into this
Agreement and to carry out the transactions contemplated
herein. The execution, delivery and performance of the
Agreement by each of Katy and Xxxxxxxx, respectively, has been
duly authorized by all necessary corporate action. This
Agreement has been duly and validly executed and delivered by
Katy and Xxxxxxxx and constitutes the legal, valid and binding
obligation of Katy and Xxxxxxxx enforceable against each of
Katy and Xxxxxxxx in accordance with its terms.
3.2 Capitalization: Xxxxxxxx'x Ownership of Shares.
(a) The Shares are duly authorized, validly issued,
fully paid and non-assessable and consist of all of the issued
and outstanding common stock of WSCL, which is the only class
of stock of WSCL that is authorized or outstanding.
(b) Xxxxxxxx owns and has, and at the Closing shall
transfer to Buyer, good, marketable and indefeasible title to
the Shares, free and clear of all liens, claims and
encumbrances.
(c) None of the Shares has been issued in the
violation of any laws pertaining to the issuance of securities
or in violation of any rights, preemptive or otherwise, or any
past or present shareholder of WSCL.
3.3 WSCL. WSCL is a corporation duly organized, validly
existing and in good standing under the laws of the State of
Connecticut, with all requisite corporate power to own, lease
and operate its properties and to carry on its business as now
being conducted. WSCL has no assets other than the Syratech
Shares. WSCL has good, marketable and indefeasible title to
the Syratech Shares, free and clear of all liens, claims and
encumbrances of any kind except for the lien of Northern Trust
as security for the loan. WSCL has, and immediately following
the Closing will have, no liabilities other than the Loan.
Without limiting the generality of the foregoing, immediately
following the Closing, WSCL shall have no liability or
obligation of any kind (i) to Northern Trust (other than for
the principal of, and interest on, the Loan) or to others for
fees and expenses in connection with obtaining and/or
documenting the Loan or (ii) for accounting or advisory fees or
taxes of any kind, including, without limitation, income taxes.
3.4 Katy's Public Filings. Katy's Common Stock, per
value $1.00 a share, is registered under Section 12(b) of the
Securities Exchange Act of 1934, as amended (the "Exchange
Act"), and since January 1, 1995, Katy has filed all Reports
pursuant to Section 13 or 15(d) of the Exchange Act that it was
required to file. Such Reports, when filed, conformed to the
Exchange Act in all material respects. None of such Reports,
when filed, contained any untrue statement of material fact or
omitted to state a material fact necessary to make the
statements contained therein, in light of the circumstances in
which they were made, not misleading.
3.5 Litigation. There is no suit, labor dispute, action
or proceeding pending or threatened against WSCL.
3.6 No Violations of Law. Neither Sellers nor WSCL has
received any written notices, and no suits or judgments are
currently pending, or threatened, concerning any alleged
violation by WSCL of any applicable law.
3.7 Full Disclosure. Neither this Agreement nor any
other written information furnished by Seller or WSCL to Buyer
in connection with this Agreement contains or will contain any
untrue statement of material fact or will omit to state a
material fact necessary to make the statements made, in light
of the circumstances in which they were made, not misleading.
3.8 Due Diligence. Katy and Xxxxxxxx have had the
opportunity to conduct complete due diligence in respect of
Buyer, have made inquiries as to the business and financial
condition of Buyer and its subsidiaries, have examined all
public filings of Buyer, have had the access and opportunity to
make such investigation of the business and financial condition
of Buyer as they deemed necessary, have not been denied access
to any information that they required, and have not otherwise
been hampered in the investigation of Buyer; and neither Katy
nor Xxxxxxxx is relying on any representations, warranties or
statements concerning Buyer that are not contained in this
Agreement.
Each of the foregoing representations, warranties and
acknowledgments shall be deemed remade by Katy and Xxxxxxxx to
Buyer on the closing Date and shall survive the Closing.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF BUYER
Buyer represents and warrants to Seller as follows:
4.1 Authority. Buyer is a corporation duly organized,
validly existing and in good standing under the laws of
Delaware, with all requisite corporate power and authority to
own, lease and operate its properties and to carry on its
business as now being conducted, and to enter into this
Agreement and to carry out the transaction contemplated herein.
The execution, delivery and performance of this Agreement by
Buyer has been duly authorized and all necessary corporate
action. This Agreement has been duly and validly executed and
delivered by Buyer and constitutes the legal, valid and binding
obligation of Buyer enforceable against Buyer in accordance
with its terms.
4.2 Securities. Buyer hereby acknowledges that the
Shares are not registered under the Securities Act of 1933, as
amended, or registered or qualified for sale under any state
securities law and cannot be resold without registration
thereunder or exemption therefrom. Buyer is acquiring the
Shares for its own account as principal, for investment, and
not with a view toward the sale or distribution thereof. Buyer
has sufficient knowledge and experience in financial and
business matters to enable it to evaluate the risks of
investment in the Shares and has the ability to bear the
economic risks of such investment.
Each of the foregoing representations, warranties, and
acknowledgments shall be deemed remade by Buyer to Seller on
the Closing Date and shall survive the Closing.
ARTICLE V
TRANSACTION FEE
Xxxxx & Company, Incorporated (Xxxxx") acted on behalf of
all parties hereto in arranging the transactions contemplated
by this Agreement. For its services, the parties have agreed to
pay Xxxxx the aggregate amount of Six Hundred Thirty Eight
Thousand Eight Hundred Seventy Five Dollars ($638,875), one-half
of which is chargeable to Seller and the other half of
which is chargeable to Buyer. Buyer has agreed to accept
responsibility for discharging the parties' entire obligation
to Xxxxx, and, in consideration of Buyer's so doing, Seller has
agreed to give Buyer a credit (the "Credit") of Three Hundred
Nineteen Thousand Four Hundred Thirty Seven and 50/100 Dollars
($319,437.50) against the purchase price of the Shares. Each
party to this Agreement represents and warrants to each other
party hereto (and Seller so represents to WSCL) that no other
investment banker, intermediary broker, finder or other agent
has been employed by such party (or WSCL) in connection with
the transactions that are the subject of this Agreement.
ARTICLE VI
INDEMNIFICATION
6.1 Each of Katy and Xxxxxxxx, jointly and severally,
agrees to indemnify the Buyer and each of the Buyer's
affiliates (including after the Closing, WSCL), and their
respective officers, directors, employees, agents and
representatives (collectively, the "Indemnified Persons"; and
each an "Indemnified Person"), against, and agrees to hold each
of them harmless from, any and all Losses incurred or suffered
by them relating to or arising out of, or in connection with,
any of the following: (a) any breach of or any inaccuracy in
any representation or warranty made by Katy or Xxxxxxxx in this
Agreement or any agreement, document or other writing delivered
at the Closing; (b) any breach of, or failure by Katy or
Xxxxxxxx to perform, any covenant or obligation of Katy or
Xxxxxxxx set out in this Agreement; and/or (c) any undisclosed
liabilities or obligations or WSCL. Without limiting the
generality of the foregoing, Katy and Xxxxxxxx, jointly and
severally, shall indemnify each and all of the Indemnified
Persons (including WSCL) from and against any and all liability
for all Taxes (as hereinafter defined) and related Losses for
which WSCL or Buyer might be or become liable for any period up
to and including the Closing including consummation of the
transactions contemplated by this Agreement. As used herein
the term "Losses" means any and all liabilities, lawsuits,
costs, claims, damages, penalties and expenses, including
attorney's fees, disbursements and other charges, in each case
incurred by an Indemnified Person, including, without
limitation, Losses incurred in making or enforcing a claim for
indemnification against Katy and/or Xxxxxxxx; and the term
"Taxes" means income and other taxes, including, without
limitation, taxes, levies and other assessments, including
gross receipts, real and personal (tangible land intangible),
sales, use, franchise, production, license, employment,
severance and withholding taxes, together with any interest,
additions or penalties with respect thereto, and any interest
in respect of each such additions or penalties, which are
imposed by any Governmental Authority.
6.2 Indemnity Obligation of Buyer. Buyer shall
indemnify, defend and hold Seller harmless against and in
respect of all claims, demands, losses and expenses, including
interest penalties and reasonable attorneys' fees and expenses,
which arise, result from or relate to (i) any inaccuracy,
misrepresentation, breach or failure by Buyer to perform any of
its representations, warranties, covenants, or agreements under
or pursuant to this Agreement, (ii) any failure to Buyer to pay
the Loan, and (iii) debts, obligations or liabilities of WSCL
attributable to periods from and after the Closing, except for
interest on the Loan to and including January 2, 1996.
ARTICLE VII
MISCELLANEOUS
7.1 Choice of Law. This Agreement and all documents
executed and delivered hereunder shall be deemed to be
contracts under the laws of Delaware, and for all purposes
shall be construed in accordance with such laws.
7.2 Further Assurances. From time to time after the
Closing, at Buyer's request and without further consideration
therefor, Seller shall perform, execute and deliver all such
further acts, assignments and assurances as may reasonably be
required for the more effective assigning, granting and selling
of the Shares transferred or to be transferred pursuant to this
Agreement, and as may be appropriate to carry out the
transaction contemplated hereby.
7.3 Headings. The headings in this Agreement are for the
purpose of reference only and shall not limit, enlarge or
otherwise affect any terms or provisions of this Agreement.
7.4 Severability. If any provision of this Agreement
shall be held to be invalid, illegal or unenforceable, the
validity, legality and enforceability of the remaining
provisions shall not, in any way, be affected by or impaired
thereby.
7.5 Survival of Representations. All representations,
warranties, covenants and agreements hereunder shall survive
the Closing.
7.6 Entire Agreement. This instrument sets forth the
entire agreement among the parties with respect to the subject
matter of this Agreement. All negotiations relative to the
matters contemplated by this Agreement are merged herein.
7.7 Waiver. No provision of this Agreement shall be
altered, amended, revoked or waived except by an instrument in
writing signed by the party sought to be charged.
7.8 Binding Effect. This Agreement shall be binding upon
and shall inure to the benefit of the parties hereto and their
respective successors and assigns.
IN WITNESS WHEREOF, the parties have made and delivered
this Agreement as of the date set forth above written.
SELLER: BUYER:
_____________________________ SYRATECH CORPORATION
By:__________________________ By:__________________________
Name:____________________
Name:______________________
Title:_____________________ Title: Vice
President, Secretary
and General Counsel
KATY INDUSTRIES, INC.
By:__________________________
Name:____________________
Title:_____________________
