EXHIBIT 99.1
AMENDMENT NO. 1
TO THE
STOCK AND ASSET PURCHASE AGREEMENT
AMENDMENT NO. 1, dated as of November 1, 2004 (this "AMENDMENT"), to
the Stock and Asset Purchase Agreement, dated as of July 8, 2004 (the
"AGREEMENT"), by and between Affinia Group Inc. (f/k/a "AAG Opco Corp."), a
Delaware corporation, and Xxxx Corporation, a Virginia corporation.
Capitalized terms used herein but not defined herein shall have the
meanings ascribed to such terms in the Agreement.
W I T N E S S E T H :
WHEREAS, the parties to the Agreement desire to amend and supplement
certain terms of the Agreement as described herein.
NOW THEREFORE, in consideration of the foregoing and the respective
representations, warranties, covenants and agreements hereinafter set forth, and
of other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, and intending to be bound hereby, the parties hereby
agree as follows:
1. SECTION 1.2 (PURCHASE AND SALE OF THE PURCHASED ASSETS). Section
1.2 of the Agreement is hereby amended to add the following at the end thereof:
"(o) the existing assets set forth on Schedule 1.2(o)."
A new Schedule 1.2(o) is hereby added to the schedules to the Agreement in the
form attached hereto as Exhibit 1.
2. SECTION 2.1 (AMOUNT AND FORM OF CONSIDERATION). Section 2.1 of the
Agreement is hereby amended to read in its entirety as follows (additional text
and deleted text are marked):
"Section 2.1. AMOUNT AND FORM OF CONSIDERATION. The consideration to
be paid by Purchaser to Seller and its Subsidiaries (other than an
Acquired Company) in full consideration of the Purchased Shares and
the Purchased Assets shall consist of:
(a) U.S.$1,024.5 million, consisting of (i) U.S.$950 million*
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[U.S.$1,105 million]* (the "INITIAL CASH CONSIDERATION") in cash,
subject to adjustment as set forth in Section 2.3 (the Initial Cash
Consideration, as so adjusted, the "FINAL CASH CONSIDERATION"), to be
paid
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* Text that is underlined denotes text that has been added to the Agreement.
Text that appears in square brackets denotes text that has been removed
from the Agreement.
in the manner and at the time set forth in Sections 2.2 and 2.3,
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and (ii) a note issued by Affinia Group Holdings Inc., a Delaware
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corporation and the indirect parent of Purchaser ("Parent"),
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substantially in the form attached hereto as Exhibit K in the
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principal amount of U.S.$74.5 million (the "NOTE"), subject to
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adjustment as set forth in Section 2.3, to be delivered by Purchaser
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to Seller at the Closing; and
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(b) the assumption by Purchaser on and as of the Closing Date of the
Assumed Liabilities."
A new Exhibit K is hereby added to the Agreement in the form attached as Exhibit
2 to this Amendment.
3. SECTION 2.3 (PURCHASE PRICE ADJUSTMENT).
(a) Section 2.3(a) of the Agreement is hereby amended to read in its
entirety as follows (additional text and deleted text are marked):
"(a) At least three Business Days prior to the Closing Date, Seller shall
prepare, or cause to be prepared, and deliver to Purchaser a [good-faith
estimated] statement [of Working Capital of the Business as of the opening
of business on the Closing Date] (the "ESTIMATED CLOSING DATE WORKING
CAPITAL STATEMENT") containing[, and] a certificate setting forth a good-
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faith estimate of Working Capital as of the opening of business on the
Closing Date (the "ESTIMATED CLOSING DATE WORKING CAPITAL") and a good-
faith estimate of the Closing Date Cash (the "ESTIMATED CLOSING DATE CASH")
(provided that the calculation of "Estimated Closing Date Cash" shall
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exclude any Foreign Sub Cash in excess of U.S.$10,000,000). The Estimated
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Closing Date Working Capital Statement shall be prepared in accordance with
GAAP, as modified by the accounting policies specified on SCHEDULE 2.3(A)
(the "SPECIFIED ACCOUNTING POLICIES"), consistent with the accounting
principles, procedures, policies and methods that were employed in
preparing the Benchmark Balance Sheet. The Initial Cash Consideration shall
be (i)(A) increased dollar for dollar in an amount not to exceed U.S.$45
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million to the extent the Estimated Closing Date Working Capital exceeds
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the Target Working Capital, or (B) decreased dollar for dollar to the
extent the Estimated Closing Date Working Capital is less than the Target
Working Capital by more than U.S.$74.5 million, [and] (ii)(A) increased
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dollar for dollar to the extent that the Estimated Closing Date Cash is
greater than U.S.$0 or (B) decreased dollar for dollar to the extent that
the Estimated Closing Date Cash is less than U.S.$0 and (iii) decreased by
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U.S.$12.5 million (the Initial Cash Consideration, as adjusted pursuant to
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this sentence, the "CLOSING DATE CASH CONSIDERATION")."
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(b) Section 2.3(f) of the Agreement is hereby amended to read in its
entirety as follows (additional text and deleted text are marked):
"(f) The Closing Date Cash Consideration shall be (i) subject to the last
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two sentences of this Section 2.3(f), (A) increased dollar for dollar to
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the extent the Final Closing Date Working Capital exceeds the lesser of the
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Estimated Closing Date Working Capital and U.S.$656 million, or (B)
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decreased dollar for dollar to the extent the Final Closing Date Working
Capital is less than the lesser of the Estimated Closing Date Working
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Capital and U.S.$656 million and (ii)(A) increased dollar for dollar to the
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extent that the Final Closing Date Cash is greater than the Estimated
Closing Date Cash or (B) decreased dollar for dollar to the extent that the
Final Closing Date Cash is less than the Estimated Closing Date Cash. Any
adjustments in cash to the Closing Date Cash Consideration made pursuant to
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this Section 2.3(f) shall be paid by wire transfer of immediately available
funds (together with interest thereon at the Applicable Rate from and
including the Closing Date to, but excluding, the date of such payment) to
the account or accounts specified by Seller, if Seller is owed payment, or
to the account or accounts specified by Purchaser, if Purchaser is owed
payment, within five Business Days after the Final Closing Date Working
Capital and Final Closing Date Cash are agreed to by Purchaser and Seller
or any remaining disputed items are ultimately determined by the Neutral
Auditors. In the event that Final Closing Date Working Capital exceeds
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Target Working Capital by an amount in excess of U.S.$45 million, then the
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amount of such excess over U.S.$45 million will be paid by Purchaser to
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Seller by way of a corresponding increase in the principal amount of the
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Note (and corresponding adjustments to the prepayment amounts), effective
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as of the Closing Date. In the event that Final Closing Date Working
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Capital is less than Target Working Capital, then the amount of such
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shortfall will be paid by Seller to Purchaser first by way of a
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corresponding decrease in the principal amount of the Note (and
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corresponding adjustments to the prepayment amounts), effective as of the
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Closing Date (provided that the principal amount of the Note may not be
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reduced below zero) and, then, if and to the extent the Final Closing Date
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Working Capital is less than U.S.$536.5 million, by wire transfer of
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immediately available funds (with interest at the Applicable Rate) as
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contemplated above."
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(c) Section 2.3(g) of the Agreement is hereby amended to read in its
entirety as follows (additional text and deleted text are marked):
"(g) [The parties agree to work together, between the date hereof and the
Closing, to prepare in good faith an allocation of $5,000,000 of the
$5,126,419 described in the definition of "Closing Date Cash"] Seller shall
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take appropriate steps so that the Foreign Sub Cash at Closing is allocated
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to each of the non-U.S. Acquired Companies in the manner described on
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Schedule 2.3(g) [based on such non-U.S. Acquired Companies' relative
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working capital needs]."
(d) A new SCHEDULE 2.3(G) is hereby added to the Agreement in the form
attached as Exhibit 3 to this Amendment.
(e) The Agreement is hereby amended by adding a new Section 2.3(h) as
follows:
"(h) In addition to the adjustments set forth in Section 2.3(f), the
Closing Date Cash Consideration shall be increased by an amount equal to
U.S.$12.5 million on the 180th day after the Closing Date. Any adjustments
to the Closing Date Cash Consideration made pursuant to this Section 2.3(h)
shall be paid by wire transfer of immediately available funds (without
interest) to the account or accounts specified by Seller on the 180th day
after the Closing Date (or, if such date is not a Business Day, the next
succeeding Business Day)."
4. SECTION 3.1 (CLOSING DATE). Section 3.1 of the Agreement is hereby
amended to add the following at the end thereof:
"Subject to the terms and conditions of this Agreement, Seller and
Purchaser shall use their reasonable best efforts to cause the Closing to
occur on November 30, 2004. If the Closing is not completed on such date,
the parties shall, subject to the terms and conditions of this Agreement,
use their reasonable best efforts to cause the Closing to occur as soon
thereafter as practicable."
5. SECTION 3.3 (DELIVERIES BY PURCHASER TO SELLER). Section 3.3 of the
Agreement is hereby amended and supplemented to include a clause (h), which
reads in its entirety as follows:
"(h) the Note, duly executed by Parent."
6. SECTION 5.5 (FINANCING). The equity commitment letter and the debt
commitment letters and related term sheets set forth on Section 5.5 of the
Purchaser Disclosure Schedule are hereby replaced with the equity commitment
letter and the debt commitment letters attached as Exhibits 4 and 5,
respectively, to this Amendment (the "REPLACEMENT FINANCING COMMITMENTS"), and
Seller hereby waives any rights it may have had with respect to the original
Financing Commitments. Seller agrees that the representations and warranties set
forth in Section 5.5 of the Agreement shall be deemed to apply, as of the date
hereof, to the Replacement
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Financing Commitments, and Purchaser hereby restates and reaffirms such
representations and warranties as of the date hereof with respect to such
Replacement Financing Commitments.
7. SECTION 5.10. The Agreement is hereby amended by adding a new
Section 5.10 as follows:
"Section 5.10. NOTE. Purchaser, on behalf of itself and Parent, represents
and warrants that the Note, upon execution and delivery at the Closing,
will constitute a valid obligation of Parent, enforceable against Parent in
accordance with its terms."
8. SECTION 6.12. The Agreement is hereby amended by adding a new
Section 6.12 as follows:
"SECTION 6.12. EUROPEAN AND SOUTH AMERICAN RESTRUCTURING AND RELATED
MATTERS.
(a) Prior to Closing, Seller shall, or shall cause its Subsidiaries to, (i)
transfer ownership of (A) all of the share capital of Xxxxxxx Xxxxxx
Automotive Limited, (B) two ordinary shares of Xxxxxxx Xxxxxx Belgium SA,
(C) one ordinary share of Xxxxxxx Xxxxxx Espana S.A., (D) 95% of the share
capital of Xxxxxxx Xxxxxx Italia Spa., (E) all of the share capital of
Xxxxxxx Xxxxxx Deutschland GmbH and (F) all of the share capital of X.
Xxxxxxx GmbH, in each case, to Brake Parts, Inc.; (ii) transfer ownership
of 5% of Xxxxxxx Xxxxxx Italia Spa. to Xxxxxxx Xxxxxx Automotive Limited or
another entity selected by Purchaser; (iii) transfer all of the share
capital of Xxxxxxx Xxxxxx France S.A.S. to Affinia Holdings S.A.S. a French
holding company to be incorporated as a direct Subsidiary of Seller prior
to Closing; (iv) transfer ownership of all of the share capital of Wix
Filtron sp. zo.o to a Dutch holding Company to be incorporated as a direct
Subsidiary of Seller prior to Closing ("Dutch Holdco"); (v) transfer all of
the share capital of Affinia Holdings S.A.S to Brake Parts Inc.; (vi)
transfer all of the share capital of Dutch Holdco to Brake Parts Inc. (the
equity interests described in clauses (i)-(vi) are referred to as the "QH
INTERESTS") and (vii) at Seller's option, cause Xxxx Automotive Limited to
transfer to Xxxxxxx Xxxxxx Automotive Limited the following real property
interests (the "QH REAL ESTATE") in the manner indicated and for the
amounts specified below (the transfers described in clause (vii) are
referred to as the "QH REAL ESTATE TRANSFERS"):
(A) "Unit 1 Nuneaton" - the land and buildings on the north side of
the Harefield Lane, Nuneaton, the leasehold of which is registered under
ti-
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tle number WK240156: Xxxx Automotive Limited will grant to Xxxxxxx Xxxxxx
Automotive Limited a sub-underlease of Unit 1 Nuneaton for a term of years
commencing on the date of Closing and expiring on 15 March 2096. The rent
payable under such sub-underlease shall be an amount equal to the rent
payable by Xxxx Automotive Limited under the terms of its underlease of
Unit 1 Nuneaton and such sub-underlease shall be granted to Xxxxxxx Xxxxxx
Automotive Limited for a premium of GBP 3.8 million plus value added tax
(if any); and
(B) "Unit 2 Nuneaton" - the land and buildings on the west side of
Bermuda Road, Nuneaton, the leasehold of which is registered under title
number WK247227: Xxxx Automotive Limited will grant to Xxxxxxx Xxxxxx
Automotive Limited a sub-underlease of Unit 2 for a term of years
commencing on the date of Closing and expiring on 15 March 2096. The rent
payable under such sub-underlease shall be an amount equal to the rent
payable by Xxxx Automotive Limited under the terms of its underlease of
Unit 2 Nuneaton and such sub-underlease shall be granted to Xxxxxxx Xxxxxx
Automotive Limited for a premium of GBP 920,000 plus value added tax (if
any).
All of the transactions described in clauses (i)-(vi) of this Section 6.12
(the "QH TRANSFERS") shall occur unless Purchaser shall have notified
Seller otherwise on or before November 8, 2004. All of the transactions
described in clause (vii) of this Section 6.12 shall occur unless Seller
shall have notified Purchaser otherwise on or before the third Business Day
prior to the Closing.
(b) SOUTH AMERICAN RESTRUCTURING AND RELATED MATTERS. Prior to Closing,
Seller shall, or shall cause its Subsidiaries to, (i) transfer all of the
right, title and interest of Seller, or the applicable Subsidiary or
Subsidiaries of Seller (other than an Acquired Company), in, to and under
all of the assets, properties, rights, Contracts and claims of Seller, or
such Subsidiary or Subsidiaries, located in Argentina, whether tangible or
intangible, real, personal or mixed, in each case, Related to the Business
but excluding the Excluded Assets, to Brake Parts Argentina S.A. (the
"ARGENTINE TRANSFER"); (ii) transfer all of the right, title and interest
of Seller, or the applicable Subsidiary or Subsidiaries of Seller (other
than an Acquired Company), in, to and under all of the assets, properties,
rights, Contracts and claims of Seller, or such Subsidiary or Subsidiaries,
located in Venezuela, whether tangible or intangible, real, personal or
mixed, in each case, Related to the Business but excluding the Excluded
Assets, to Echlin de Venezuela C.A.; (the "VENEZUELAN TRANSFER"), (iii)
transfer all of the right, title and interest of Seller, or the applicable
Subsidiary or Subsidiaries of Seller (other than an
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Acquired Company), in, to and under all of the assets, properties, rights,
Contracts and claims of Seller, or such Subsidiary or Subsidiaries, located
in Brazil, whether tangible or intangible, real, personal or mixed, in each
case, Related to the Business but excluding the Excluded Assets, to AAG
Brasil Ind. E Com. de Autopecas (the "BRAZILIAN TRANSFER"). In connection
with the foregoing transfers, Seller shall cause (A) Brake Parts Argentina
S.A. to agree to assume and be liable for, and to pay, perform and
discharge when due, all obligations and Liabilities of Seller and its
Subsidiaries (other than Acquired Companies), whether occurring or accruing
before, on or after the date of the Argentine Transfer, whether known or
unknown, fixed or contingent, asserted or unasserted, and not satisfied or
extinguished as of the date of the Argentine Transfer, primarily relating
to, primarily arising out of or primarily resulting from the Business in
Argentina; (B) Echlin de Venezuela C.A. to agree to assume and be liable
for, and to pay, perform and discharge when due, all obligations and
Liabilities of Seller and its Subsidiaries (other than Acquired Companies),
whether occurring or accruing before, on or after the date of the
Venezuelan Transfer, whether known or unknown, fixed or contingent,
asserted or unasserted, and not satisfied or extinguished as of the date of
the Venezuelan Transfer, primarily relating to, primarily arising out of or
primarily resulting from the Business in Venezuela; and (C) AAG Brasil Ind.
E Com. de Autopecas to agree to assume and be liable for, and to pay,
perform and discharge when due, all obligations and Liabilities of Seller
and its Subsidiaries (other than Acquired Companies), whether occurring or
accruing before, on or after the date of the Brazilian Transfer, whether
known or unknown, fixed or contingent, asserted or unasserted, and not
satisfied or extinguished as of the date of the Brazilian Transfer,
primarily relating to, primarily arising out of or primarily resulting from
the Business in Brazil.
(c) TRANSFER TAXES. Notwithstanding anything to the contrary in Section
14.9:
(i) Purchaser shall be responsible for and shall pay Transfer Taxes,
regardless of the Person liable for such Taxes under applicable Law,
arising out of the QH Transfers;
(ii) to the extent (A) the sum of (1) the Transfer Taxes arising out
of the QH Transfers PLUS (2) the Transfer Taxes resulting from the direct
or indirect transfers of the QH Interests under Article I of this Agreement
at the Closing exceeds (B) the Transfer Taxes that would otherwise have
resulted from the direct or indirect transfers of the QH Interests under
Article I of this Agreement in the absence of the QH Transfers, such excess
shall not count against the U.S.$1 million Transfer Tax threshold set forth
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in Section 14.9(a) of this Agreement,
(iii) Seller shall be responsible for and shall pay Transfer Taxes,
regardless of the Person liable for such Taxes under applicable Law,
arising out of the QH Real Estate Transfers, to the extent (A) the sum of
(1) the Transfer Taxes arising out of the QH Real Estate Transfers PLUS (2)
the Transfer Taxes resulting from the direct or indirect transfers of the
QH Real Estate under Article I of this Agreement at the Closing exceeds (B)
the Transfer Taxes that would otherwise have resulted from the direct or
indirect transfers of the QH Real Estate under Article I of this Agreement
in the absence of the QH Real Estate Transfers (it being understood that
any amount not in excess of such amount shall count against the U.S.$1
million Transfer Tax threshold set forth in Section 14.9(a) of this
Agreement).
The parties hereto shall reasonably cooperate to reduce or eliminate any
potential Transfer Taxes arising out of these transactions, including
obtaining available Transfer Tax exemption certificates (such as sales and
use Tax blanket exemption certificates) from the applicable state, local or
foreign taxing jurisdictions."
9. SECTION 6.13. The Agreement is hereby amended by adding a new
Section 6.13 as follows:
"SECTION 6.13. ECHLIN NAME. Seller shall use reasonable best efforts to
obtain for the Business from Standard Motor Products ("SMP") an exclusive,
royalty-free license to use the "Echlin" name as part of the company name
for any Acquired Companies that use it as of the date of this Agreement and
to sell current Echlin packaged inventory through December 31, 2004;
PROVIDED, HOWEVER, that in using its reasonable efforts Seller shall not be
required by this Section 6.13 to incur any cost, expense, obligation or
liability or to give up any rights in order to obtain any license (but, to
the extent necessary to obtain SMP's consent to the foregoing, Seller and
its Subsidiaries shall promptly pay to SMP all amounts owed to SMP)."
10. SECTION 7.7(F) (USE OF SELLER NAME).
(a) Section 7.7(f) of the Agreement is hereby amended to read in its
entirety as follows:
"(f) at the Closing, Seller will enter into an agreement with Purchaser to
grant, or cause its Subsidiaries to grant, Purchaser licenses, effective as
of Closing, to use the "Xxxxxx", "Urba" and "Brosol" brand names on the
terms set forth on SCHEDULE 7.7(F);"
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(b) Schedule 7.7(f) to the Agreement is hereby replaced with the term
sheet attached as Exhibit 6.
11. SECTION 7.10.
(a) The Agreement is hereby amended by adding a new Section 7.10 as
follows:
"SECTION 7.10. OTHER AGREEMENTS. At the Closing, Purchaser shall enter into
guarantees substantially in the forms attached as SCHEDULE 7.10."
(b) A new SCHEDULE 7.10 is hereby added to the Agreement in the form
attached as Exhibit 7 to this Amendment.
12. SECTION 10.1(F)(IV) (LONG-TERM DISABILITY).
(a) Section 10.1(f)(iv) of the Agreement is hereby amended to read in
its entirety as follows (additional text and deleted text are marked):
"(iv) Notwithstanding anything herein to the contrary, Seller and its
Subsidiaries shall retain all Liabilities for [long-term disability salary
continuation income] benefits under any long-term disability plan of Seller
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and its Subsidiaries in respect of any current or former employees of the
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Business who are receiving, or are eligible to receive, such benefits as of
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the Closing [the individuals listed on Section 10.1(f)(iv) of the Seller
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Disclosure Schedule] (the "LTD EMPLOYEES")[under any long-term disability
plan of Seller and its Subsidiaries]."
(b) SECTION 10.1(F)(IV) of the Seller Disclosure Schedule is hereby deleted in
its entirety.
13. SECTION 10.2 (TRANSITION AGREEMENTS; ANCILLARY AGREEMENTS).
(a) Section 10.2 of the Agreement is hereby amended to read in its entirety as
follows (additional text and deleted text are marked):
"Section 10.2. TRANSITION AGREEMENTS; ANCILLARY AGREEMENTS. Effective at
the Closing, Purchaser and Seller, or such of their respective Subsidiaries
as appropriate, shall enter into one or more transition services agreements
substantially in the form of Exhibit H (the "Transition Services
Agreements" and together with the Transition Intellectual Property License
Agreement, the "Transition Agreements"). On and after the date hereof and
until [the one-month anniversary of ]the Closing, Purchaser and Seller
agree to negotiate in good faith to enter into agreements on the terms and
conditions set
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forth in the schedule of ancillary agreements attached as Exhibit I (the
"Schedule of Ancillary Agreements"). Purchaser and Seller hereby agree that
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the final terms and conditions of the Transition Agreements and the
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agreements described in the Schedule of Ancillary Agreements (the
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"ANCILLARY AGREEMENTS") will be consistent with the terms set forth in the
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term sheet attached hereto as Schedule 10.2."
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(b) A new Schedule 10.2 is hereby added to the schedules to the
Agreement in the form attached hereto as Exhibit 8.
14. SECTION 10.3 (FURTHER ASSURANCES). Section 10.3(f) of the
Agreement is hereby amended to add the following at the end thereof:
"Notwithstanding anything to the contrary herein, Seller shall cause all
insurance proceeds owing to Seller or its Affiliates (including the
Acquired Companies and including proceeds payable by any of its Affiliates)
in respect of a fire that occurred at Echlin Mexicana's facilities in
November 2003 to be paid to Seller or its Affiliates, as applicable, prior
to the Closing."
15. PRODUCTS. Purchaser and Seller hereby agree to enter into a letter
agreement on the terms and conditions set forth in Exhibit 9.
16. SECTION 10.4. The Agreement is hereby amended by adding a new
Section 10.4 as follows:
"Section 10.4. ACQUISITION FINANCING. Without limiting the generality of
Section 6.10 or Section 7.5(b):
(a) Seller shall use its reasonable best efforts to provide to Purchaser
not later than November 7, 2004 information concerning the Business (the
"UPDATED INFORMATION") sufficient to (i) update all of the financial
information contained in the preliminary offering circular dated as of
November 1, 2004 (the "PRELIMINARY OFFERING CIRCULAR") as of, and for the
six- and twelve-month periods ended, June 30, 2004, and for the six-month
period ended June 30, 2003, and to reflect financial information as of, and
for the nine- and twelve-month periods ended, September 30, 2004, and for
the nine-month period ended September 30, 2003 including all such
information contained in the sections captioned "Summary--Summary
Historical and Pro Forma Financial Data", "Unaudited Pro Forma Combined
Financial Information", "Selected Historical Financial Data", "Management's
Discussion and Analysis of Financial Condition and Results of Operations"
and "Combined Financial Statements" and (ii) permit Pricewaterhouse-
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Coopers LLP to provide a comfort letter customary for transactions similar
to those contemplated by the Preliminary Offering Circular with respect to
the Updated Information, with comfort levels that are consistent with those
that PricewaterhouseCoopers LLP has indicated it would be prepared to
provide with respect to the financial information being replaced by the
Updated Information. Updated Information sufficient to satisfy the
conditions described in the foregoing clauses (i) and (ii) shall be
referred to as "SUFFICIENT UPDATED INFORMATION").
(b) Purchaser shall (subject to the other terms and conditions of this
Agreement) use its reasonable best efforts to enter into a definitive
purchase agreement (the "NOTE PURCHASE AGREEMENT") on or before November
12, 2004 with one or more initial purchasers providing for the offer and
sale of up to U.S.$300 million of senior subordinated notes (the "SENIOR
SUBORDINATED NOTES") on terms and conditions customary for financing
acquisitions of this nature and including the following terms:
(i) if Seller shall have delivered to Purchaser Sufficient Updated
Information on or before November 7, 2004:
(A) that the sale of the Senior Subordinated Notes shall be
conditioned upon the simultaneous consummation of the Closing under this
Agreement; and
(B) that delivery of, and payment for, the Senior
Subordinated Notes shall occur on or about November 30, 2004.
(ii) if Seller shall not have delivered to Purchaser Sufficient
Updated Information on or before November 7, 2004:
(A) that the sale of the Senior Subordinated Notes shall not
be conditioned upon the simultaneous consummation of the Closing under this
Agreement;
(B) that delivery of, and payment for, the Senior
Subordinated Notes shall occur on or about November 17, 2004;
(C) that the net proceeds (after fees, discounts and
expenses) for the Senior Subordinated Notes shall be deposited by the
initial purchasers into an escrow account and that such proceeds will only
be released to the Purchaser (1) if such proceeds are to be used to fund the
simultaneous consummation of the Closing under this Agreement and (ii) if no
default or event of default would occur under the instruments governing the
Senior Subordinated Notes;
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(D) that Purchaser will be required to redeem the Senior
Subordinated Notes if the Closing under this Agreement does not occur by the
Outside Date or this Agreement is terminated prior to such Closing (any such
redemption, a "MANDATORY EARLY REDEMPTION"); and
(E) unless Seller consents, that a Mandatory Early
Redemption shall not require the payment of any premium or penalty on the
face amount of the Senior Subordinated Notes in excess of 0.1% of such face
amount.
(c) Subject to the last sentence of this Section 10.4(c), Seller hereby
agrees to indemnify, defend and hold the Purchaser Indemnified Group
harmless from and against any and all Losses arising out of or resulting
from a Mandatory Early Redemption. The foregoing indemnity shall in no way
limit the Purchaser's rights and remedies in respect of any breach of this
Agreement (other than a breach of Section 10.4(a)). Notwithstanding the
foregoing, in the event of a termination of this Agreement pursuant to
Section 13.1(c), any portion of the Initial Deposit not returned to Seller
following a Mandatory Redemption (other than such portion attributable to
interest that has accrued on the Senior Subordinated Notes prior to
redemption) shall constitute a "Loss" of Seller for purposes of Section
11.2(b)(ii) of this Agreement.
(d) If Seller shall not have delivered to Purchaser Sufficient Updated
Information on or before November 7, 2004, then Seller shall be required,
as a condition to Purchaser's obligation to sell the Senior Subordinated
Notes, to deposit into an escrow account for the benefit of the purchasers
and holders of the Senior Subordinated Notes an amount (the "INITIAL
DEPOSIT") in U.S. Dollars equal to the sum of (i) the maximum possible
redemption price under the Note Purchase Agreement (the "NOTE PROCEEDS")
LESS (ii) the net proceeds (after fees, discounts and expenses) to be paid
into the escrow account under the Note Purchase Agreement. In the event of
a Mandatory Early Redemption, the Initial Deposit will be available for use
in redeeming the Senior Subordinated Notes; provided that the Initial
Deposit shall be applied to such redemption only if and to the extent that
the Note Proceeds (together with any interest earned on such amount while
held in escrow) are insufficient to redeem the Senior Subordinated Notes,
and the remaining balance of the Initial Deposit (if any) after such
redemption shall be promptly returned to Seller. If the Closing under this
Agreement occurs, the Initial Deposit will be used to pay Purchaser an
amount equal to the interest that has accrued on the Senior Subordinated
Notes prior to the Closing under this Agreement and the remainder, if any,
shall be returned to Seller (together with any interest earned on such
amount
12
while held in escrow). Seller shall pay all costs and expenses related to
the escrow, including fees and expenses of the escrow agent, if any;
provided that, notwithstanding the foregoing, in the event of a termination
of this Agreement pursuant to Section 13.1(c), any such costs and expenses
(other than interest that has accrued on the Senior Subordinated Notes
prior to redemption) shall constitute a "Loss" of Seller for purposes of
Section 11.2(b)(ii) of this Agreement."
17. SECTION 14.1 (TAX INDEMNIFICATION). Clause (ii) of Section 14.1(b)
is hereby amended to read in its entirety as follows:
"(ii) Transfer Taxes and VAT required to be borne by Purchaser pursuant to
Section 6.12(c) and Section 14.9,"
18. SECTION 15.1 (DEFINITIONS). Section 15.1 is hereby amended (i) in
the definition of "Closing Date Cash," to replace "$5,126,419" with
U.S.$10,000,000 and (ii) to add the following definitions in the appropriate
alphabetical location:
"'FINAL CONSIDERATION' means the sum of the Final Cash Consideration, the
Final Note Principal Amount and the Assumed Liabilities (other than
liabilities or obligations of the Acquired Companies).
"'FINAL NOTE PRINCIPAL AMOUNT' means the principal amount of the Note, as
adjusted pursuant to Section 2.3(f).
"'NOTE' has the meaning set forth in Section 2.1(a)."
19. SECTION 15.2 (ENTIRE AGREEMENT). Section 15.2 is hereby amended to
add the following at the end thereof:
"Nothing contained in any Transfer Deed shall be deemed to modify or limit
any of the terms and provisions of this Agreement, including the provisions
of Article XI."
20. SCHEDULE 1.2(G) (INTELLECTUAL PROPERTY). Annex A to Schedule
1.2(g) is hereby amended by deleting each trademark listed therein that contains
either the name "URBA" or the name "BROSOL."
21. SCHEDULE 2.4 (PURCHASE PRICE ALLOCATION). Schedule 2.4 to the
Agreement is hereby replaced with Exhibit 10 to this Amendment.
22. SECTION 4.7 OF THE SELLER DISCLOSURE SCHEDULE (MATERIAL ADVERSE
CHANGES). Section 4.7 of the Seller Disclosure Schedule is hereby amended by the
addition of the items set forth on Exhibit 11 to this Amendment. The disclosures
set
13
forth on Exhibit 11 shall be deemed for all purposes of the Agreement to have
been disclosed as of the date of this Amendment, except for purposes of
determining whether any representation or warranty of Seller set forth in the
Agreement (a) is true and correct for purposes of Section 8.1 and (b) is
accurate or has been breached for purposes of Section 11.2(a)(i) (in each of
which cases, the disclosures set forth on Exhibit 11 shall be deemed to have
been disclosed as of the date of the Agreement).
23. MATERIAL ADVERSE CHANGES. As an inducement to Purchaser to enter
into this Amendment and to consummate the transactions contemplated hereby,
Seller hereby represents and warrants to Purchaser that, except as contemplated
by the Agreement or as set forth on Section 4.7(a) of the Seller Disclosure
Schedule (as amended hereby), since December 31, 2003, (i) the business of the
Acquired Companies and the Business has been conducted in all material respects
in the ordinary course of business consistent with past practice (except as
expressly requested by Purchaser), and (ii) there has not been and does not
exist any change or event or effect that, individually or in the aggregate, has
had or would reasonably be expected to have a Material Adverse Effect.
24. WAIVER. As an inducement to both Parties to enter into this
Amendment and to consummate the transactions contemplated hereby, each Party
hereby waives all claims of breach or potential breach of the Agreement asserted
in writing to the other Party or its Representatives prior to the date of this
Amendment, and all such claims of breach or potential breach are hereby deemed
cured.
25. MISCELLANEOUS. All terms set forth in Article XV of the Agreement
are restated herein in full with the exception that references to "this
Agreement" shall be references to "this Amendment."
26. REMAINDER OF AGREEMENT. Except as expressly set forth herein, this
Amendment shall not by implication or otherwise alter, modify, amend or in any
way affect any of the terms, conditions, obligations, covenants or agreements
contained in the Agreement, all of which shall continue to be in full force and
effect.
[Remainder of page intentionally left blank.]
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to
be executed as of the date first above written.
AFFINIA GROUP INC.
By: /s/ Xxxxxxx Xxxxxx
-------------------------
Name: Xxxxxxx Xxxxxx
Title: President
XXXX CORPORATION
By: /s/ Xxxxxxx X. XxXxxxxx
-------------------------
Name: Xxxxxxx X. XxXxxxxx
Title: Vice President
[Signature Page to Amendment No. 1 to the Stock Purchase Agreement]
