TERMINATION AGREEMENT
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THIS TERMINATION AGREEMENT (this "Agreement"), dated January 19, 1998,
is by and among ITEQ, Inc., a Delaware corporation ("ITEQ"), ITEQ Sub Corp.,
a Delaware corporation and a wholly-owned subsidiary of ITEQ ("Subcorp"),
and Matrix Service Company, a Delaware corporation ("Matrix"). ITEQ and
Subcorp are hereinafter sometimes referred to as "ITEQ Group."
W I T N E S S E T H
WHEREAS, ITEQ, Subcorp and Matrix have entered into that certain Plan
and Agreement of Merger, dated December 16, 1997 (the "Merger Agreement");
WHEREAS, ITEQ, Subcorp and Matrix recognize that heretofore unanticipated
difficulties have arisen in connection with the expected integration of
personnel from divergent corporate cultures;
WHEREAS, the respective boards of directors of ITEQ, Subcorp and Matrix
deem it desirable and in the best interest of their respective corporations
and their respective stockholders that the Merger Agreement be terminated
pursuant to Paragraph 6.1.1 of the Merger Agreement;
NOW, THEREFORE, in consideration of the premises and of the mutual
agreements herein contained the parties hereto agree as follows:
1. Termination of Merger Agreement. ITEQ, Subcorp and Matrix agree
to terminate the Merger Agreement pursuant to Paragraph 6.1.1 thereof.
2. Allocation of Expenses. ITEQ and Subcorp agree to be solely
responsible for and to bear any and all expenses incurred by either of them,
either directly or through arrangements contracted by either of them for
third party services in connection with the investigation, negotiation
or proposed implementation of any transaction contemplated by the Merger
Agreement. Matrix agrees to be solely responsible for and to bear any and
all expenses incurred by it, either directly or through arrangements
contracted by it for third party services in connection with the
investigation, negotiation or proposed implementation of any transaction
contemplated by the Merger Agreement; provided, however, that ITEQ shall
be solely responsible for and shall bear any and all fees and expenses of
PaineWebber Incorporated ("PW") billed to Matrix for services rendered by
PW in connection with the proposed rendition by PW of a fairness opinion
to Matrix in connection with the merger contemplated by the Merger Agreement
to the extent and only to the extent that such fees and expenses shall be
in excess of an aggregate of $225,000 (the "Excess Claim Amount"), it being
understood that ITEQ shall have complete discretion to act for Matrix in
any negotiation, settlement or payment of an Excess Claim Amount; and ITEQ
agrees to indemnify and hold harmless Matrix and its officers and directors
and each person who controls Matrix with respect to any such Excess
Claim Amount.
3. Mutual Releases: Merger Agreement Void. ITEQ Group and Matrix
represent, mutually remise, release and forever discharge each other and
their respective affiliates, directors, officers, employees, agents,
representatives, and successors and assigns from any and all manner of
action and actions, cause and causes of action, suits, debts, dues, sums
of money, accounts, reckonings, bills, specialities, covenants, contracts,
controversies, agreements, promises, variances, trespasses, damages,
judgments, executions, claims and demands (collectively "Claims"),
whatsoever, in law or in equity, which against the other they may have ever
had, now have or might have had, by reason of any matter, cause or thing
whatsoever, including, but not limited to, claims arising under any federal,
state or local law for breach of any implied covenant of good faith and fair
dealing, breach of contract, defamation, slander, negligent misrepresentation,
fraud, and intentional or negligent interference with business relations, to
the date of this general mutual release, insofar as Claims arise out of or in
connection with (i) the investigation or proposed implementation of the
transactions contemplated by the Merger Agreement or (ii) the negotiation,
performance or actual or alleged breach of any representation, warranty,
covenant or agreement contained in the Merger Agreement (which Merger
Agreement shall upon the execution of this Agreement become and be null and
void and have no further force or effect whatsoever) provided, however, that
such release shall not affect the obligations of the ITEQ Group or Matrix
under any provision of this Agreement.
4. Confidentiality Agreements Reaffirmed. The ITEQ Group and Matrix
hereby agree and confirm that (with the exception of the first sentence in
paragraph 4 of each such agreement, which sentence shall have no further
force or effect whatsoever) all provisions of the Confidentiality Agreements
dated November 4, 1997 and December 2, 1997 between Matrix and ITEQ remain in
full force and effect, and each agrees to strictly comply with all such
contractual provisions.
5. Public Announcements. The ITEQ Group and Matrix agree that they
shall consult with each other before the making of any public announcement
regarding the existence of this Agreement or the contents hereof or the
termination of the Merger Agreement and to obtain the prior approval of the
other party as to the content of such announcement, which approval shall not
be unreasonably withheld. The foregoing shall not apply, however, to any
announcement or written statement which, upon the written advice of counsel,
is required by law to be made, except that the party required to make such
announcement shall consult with and solicit prior approval from such other
party concerning the timing and content of such legally required announcement
or statement before it is made.
6. Successors and Assigns. This Agreement shall be binding upon and
shall inure to the benefit of and be enforceable by the successors and
assigns of the parties hereto.
7. Entirety. This Agreement and (to the extent reaffirmed by this
Agreement) the Confidentiality Agreements dated November 4, 1997 and December
2, 1997 between Matrix and ITEQ constitute the entire Agreement between the
parties with respect to the subject matter hereof, and all prior agreements
between the parties with respect thereto are hereby superseded in their
entirety.
8. Counterparts. Any number of counterparts of this Agreement may be
executed and each such counterpart shall be deemed to be an original
instrument, but all such counterparts together shall constitute but one
instrument.
9. Notices and Waivers. Any notice or waiver to be given to any
party hereto shall be in writing and shall be delivered by courier, sent by
facsimile transmission or first class registered or certified mail, postage
prepaid.
If to ITEQ
Addressed to: With a copy to:
ITEQ, Inc. ▇▇▇▇▇▇ & ▇▇▇▇▇▇, L.L.P.
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇ 700 Louisiana, ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ Attention: T. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇ Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
If to Matrix
Addressed to: With a copy to:
Matrix Service Company ▇▇▇▇▇▇▇ & ▇▇▇▇▇, L.L.P.
▇▇▇▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇ Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇ Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Any communication so addressed and mailed by first-class registered
or certified mail, postage prepaid, shall be deemed to be received on the
third business day after so mailed, and if delivered by courier or facsimile
to such address, upon delivery during normal business hours on any business
day.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
signed in their respective corporate names by their respective duly authorized
representatives on the day and year first above written.
ITEQ
By: /s/▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Chairman of the Board
and Chief Executive Officer
ITEQ SUB CORP.
By: /s/▇▇▇▇ ▇. ▇▇▇▇▇▇▇, President
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MATRIX SERVICE COMPANY
By: /s/▇▇▇▇ ▇. ▇▇▇▇
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▇▇▇▇ ▇. ▇▇▇▇, Chairman of the Board
and Chief Executive Officer