ASSET PURCHASE AND SALE AGREEMENT BY AND AMONG CHEMTURA CORPORATION, CHEMTURA CANADA CO./CIE, CHEMTURA INDUSTRIA QUIMICA DO BRASIL LIMITADA, CHEMTURA ITALY S.R.L., CHEMTURA CORPORATION, S.A. DE C.V. CHEMTURA NETHERLANDS B.V., MONOCHEM, INC., UNIROYAL...
EXECUTION
COPY
BY
AND AMONG
CHEMTURA
CORPORATION,
CHEMTURA
CANADA CO./CIE,
CHEMTURA
INDUSTRIA QUIMICA DO BRASIL LIMITADA,
CHEMTURA
ITALY S.R.L.,
CHEMTURA
CORPORATION, S.A. DE C.V.
CHEMTURA
NETHERLANDS B.V.,
MONOCHEM,
INC.,
UNIROYAL
CHEMICAL TAIWAN LTD.
AND
LION
COPOLYMER, LLC
Dated
as of February 3, 2007
SALE
OF ETHYLENE PROPYLENE DIENE MONOMER
RUBBER
(EPDM) AND RUBBER CHEMICALS BUSINESSES
TABLE
OF CONTENTS
Page
|
||||
ARTICLE
1.
|
DEFINITIONS
|
1
|
||
1.1
|
Definitions
|
1
|
||
1.2
|
Other
Definitional Provisions and Interpretation
|
20
|
||
ARTICLE
2.
|
PURCHASE
AND SALE OF ASSETS; ASSUMPTION OF ASSUMED OBLIGATIONS
|
20
|
||
2.1
|
Purchase
and Sale of Assets
|
20
|
||
2.2
|
Assignment
of Permits and Contracts
|
22
|
||
2.3
|
Certain
Provisions Regarding Assignments
|
23
|
||
2.4
|
Excluded
Assets
|
24
|
||
2.5
|
Assumed
Obligations
|
26
|
||
2.6
|
Retained
Obligations
|
28
|
||
2.7
|
Prorations
|
29
|
||
ARTICLE
3.
|
PURCHASE
PRICE; ADJUSTMENT; ALLOCATION
|
30
|
||
3.1
|
Payment
of Purchase Price
|
30
|
||
3.2
|
Purchase
Price Adjustments
|
31
|
||
3.3
|
Withholding
|
34
|
||
3.4
|
Allocation
of Consideration for Assets
|
34
|
||
ARTICLE
4.
|
REPRESENTATIONS
AND WARRANTIES OF SELLERS
|
35
|
||
4.1
|
Due
Organization
|
35
|
||
4.2
|
Due
Authorization
|
35
|
||
4.3
|
Consents
and Approvals; Authority Relative to this Agreement
|
35
|
||
4.4
|
Financial
Statements
|
36
|
||
4.5
|
No
Adverse Effects or Changes
|
36
|
||
4.6
|
Title
to Assets
|
36
|
||
4.7
|
Assets
|
37
|
||
4.8
|
Real
Property
|
37
|
||
4.9
|
Equipment;
Leased Personal Property
|
38
|
||
4.10
|
Customers
and Suppliers
|
38
|
||
4.11
|
Accounts
Receivable
|
39
|
||
4.12
|
Proceedings
|
39
|
i
TABLE
OF CONTENTS
(continued)
Page
|
||||
4.13
|
Intellectual
Property
|
40
|
||
4.14
|
Contracts
|
42
|
||
4.15
|
Permits
|
44
|
||
4.16
|
Inventory
|
44
|
||
4.17
|
Benefit
Plans
|
45
|
||
4.18
|
Employment
and Labor Matters
|
46
|
||
4.19
|
Taxes
|
47
|
||
4.20
|
No
Defaults or Violations
|
48
|
||
4.21
|
Environmental
Matters
|
49
|
||
4.22
|
Conduct
of the Business
|
50
|
||
4.23
|
Foreign
Corrupt Practices
|
50
|
||
4.24
|
EBITDA
for the EPDM Business
|
50
|
||
4.25
|
Sale
of Products
|
51
|
||
4.26
|
Chinese
Joint Venture
|
51
|
||
ARTICLE
5.
|
REPRESENTATIONS
AND WARRANTIES OF THE PURCHASER
|
51
|
||
5.1
|
Due
Incorporation
|
51
|
||
5.2
|
Due
Authorization
|
51
|
||
5.3
|
Consents
and Approvals; Authority Relative to this Agreement
|
51
|
||
5.4
|
Proceedings
|
52
|
||
5.5
|
Financing
|
52
|
||
ARTICLE
6.
|
COVENANTS
|
52
|
||
6.1
|
Access
to Information
|
52
|
||
6.2
|
Preservation
of Business
|
53
|
||
6.3
|
Consents
and Approvals
|
54
|
||
6.4
|
Chemtura
Names
|
56
|
||
6.5
|
Brokers
|
58
|
||
6.6
|
Preservation
of Books and Records; Access and Assistance
|
58
|
||
6.7
|
Insurance
|
59
|
||
6.8
|
Confidentiality
|
59
|
||
6.9
|
Guarantees;
Credit Support
|
61
|
ii
TABLE
OF CONTENTS
(continued)
Page
|
||||
6.10
|
Taxes
|
62
|
||
6.11
|
Certain
Restrictions
|
64
|
||
6.12
|
Purchaser’s
Option
|
65
|
||
6.13
|
Naugatuck
Equipment
|
65
|
||
6.14
|
Chemtura’s
Option
|
66
|
||
6.15
|
Decommissioning
of Wastewater Tank
|
66
|
||
6.16
|
Financial
Assurance
|
66
|
||
6.17
|
Financial
Statements
|
67
|
||
6.18
|
Customer
Accounts Receivable
|
67
|
||
6.19
|
Customer
Returns and Warranty Support Services
|
68
|
||
6.20
|
Certain
Matters Regarding Financing
|
68
|
||
6.21
|
Intellectual
Property Rights Actions
|
68
|
||
6.22
|
Attorney-Client
Privilege
|
68
|
||
6.23
|
Filing
of Assignments
|
68
|
||
6.24
|
Key
Employees
|
69
|
||
6.25
|
Certain
Related Agreements
|
69
|
||
6.26
|
Receivables
Securitization Agreements
|
69
|
||
6.27
|
Chinese
Joint Venture
|
69
|
||
6.28
|
Foreign
Accounts Receivable
|
69
|
||
6.29
|
Adjustments
to Pre-Signing Financial Statements
|
69
|
||
ARTICLE
7.
|
CONDITIONS
PRECEDENT TO OBLIGATIONS OF THE PURCHASER
|
70
|
||
7.1
|
Representations
and Warranties True
|
70
|
||
7.2
|
Compliance
with Agreements and Covenants
|
71
|
||
7.3
|
Certificate
of Compliance
|
71
|
||
7.4
|
HSR
Act; Premerger Notification Provisions; Brazil
|
71
|
||
7.5
|
Governmental
Required Consents
|
71
|
||
7.6
|
No
Injunctions or Other Legal Restraints
|
71
|
||
7.7
|
Related
Agreements
|
72
|
||
7.8
|
Contractual
Consents
|
72
|
iii
TABLE
OF CONTENTS
(continued)
Page
|
||||
7.9
|
Debt
Financing
|
72
|
||
7.10
|
The
Designated Agreements
|
72
|
||
7.11
|
Termination
of Contracts
|
72
|
||
7.12
|
Business
Material Adverse Effect
|
72
|
||
7.13
|
Certificate
of Non-Foreign Status
|
72
|
||
7.14
|
Resolution
of Matters Related to the UBOB Operations
|
72
|
||
7.15
|
Asbestos
Abatement
|
72
|
||
7.16
|
Title
Commitments
|
72
|
||
7.17
|
Surveys
|
73
|
||
7.18
|
Estimated
Working Capital Amount
|
73
|
||
7.19
|
Effect
on EBITDA of the Business
|
73
|
||
7.20
|
Permits
|
73
|
||
7.21
|
Chinese
Joint Venture
|
73
|
||
7.22
|
Intellectual
Property Rights Actions
|
73
|
||
7.23
|
Replacement
Capital Analysis
|
73
|
||
ARTICLE
8.
|
CONDITIONS
PRECEDENT TO OBLIGATIONS OF THE SELLERS
|
73
|
||
8.1
|
Representations
and Warranties True
|
74
|
||
8.2
|
Compliance
with Agreements and Covenants
|
74
|
||
8.3
|
Certificate
of Compliance
|
74
|
||
8.4
|
HSR
Act; Premerger Notification Provisions; Brazil
|
74
|
||
8.5
|
No
Injunctions or Other Legal Restraints
|
74
|
||
8.6
|
Related
Agreements
|
74
|
||
8.7
|
Consents
|
74
|
||
ARTICLE
9.
|
CLOSING
|
74
|
||
9.1
|
Closing
|
74
|
||
9.2
|
Deliveries
by the Sellers
|
75
|
||
9.3
|
Deliveries
by the Purchaser
|
76
|
||
ARTICLE
10.
|
TERMINATION
|
77
|
||
10.1
|
Termination
|
77
|
iv
TABLE
OF CONTENTS
(continued)
Page
|
||||
10.2
|
Effect
of Termination
|
78
|
||
ARTICLE
11.
|
EMPLOYEES
AND EMPLOYEE BENEFITS
|
78
|
||
11.1
|
Offers
of Employment
|
78
|
||
11.2
|
Vesting
and Service Credit
|
79
|
||
11.3
|
Non-U.S.
Employees
|
79
|
||
11.4
|
Severance
Costs
|
79
|
||
11.5
|
Retention
Payments
|
80
|
||
11.6
|
No
Third Party Beneficiaries
|
80
|
||
11.7
|
UK
Employees and Other Non-U.S. Employee Matters
|
81
|
||
ARTICLE
12.
|
INDEMNIFICATION
|
82
|
||
12.1
|
Survival
|
82
|
||
12.2
|
Indemnification
by the Sellers
|
82
|
||
12.3
|
Indemnification
by the Purchaser
|
83
|
||
12.4
|
Limitations
on Liability
|
84
|
||
12.5
|
Claims
|
85
|
||
12.6
|
Notice
of Third Party Claims; Assumption of Defense
|
85
|
||
12.7
|
Settlement
or Compromise
|
86
|
||
12.8
|
Mitigation;
Net Losses; Subrogation
|
86
|
||
12.9
|
Environmental
Indemnification
|
87
|
||
12.10
|
Purchase
Price Adjustments
|
89
|
||
ARTICLE
13.
|
MISCELLANEOUS
|
89
|
||
13.1
|
Expenses
|
89
|
||
13.2
|
Amendment
|
89
|
||
13.3
|
Notices
|
89
|
||
13.4
|
Payments
in Dollars
|
90
|
||
13.5
|
Waivers
|
90
|
||
13.6
|
Binding
Effect; Assignment
|
90
|
||
13.7
|
No
Third Party Beneficiaries
|
92
|
||
13.8
|
Publicity
|
92
|
||
13.9
|
Further
Assurances
|
92
|
v
TABLE
OF CONTENTS
(continued)
Page
|
||||
13.10
|
Severability
|
92
|
||
13.11
|
Entire
Understanding
|
92
|
||
13.12
|
Language
|
93
|
||
13.13
|
Applicable
Law
|
93
|
||
13.14
|
Remittances
|
93
|
||
13.15
|
Bulk
Sales
|
93
|
||
13.16
|
Jurisdiction
of Disputes; Waiver of Jury Trial
|
93
|
||
13.17
|
Schedules;
Communication
|
94
|
||
13.18
|
Disclaimer
of Warranties
|
94
|
||
13.19
|
Counterparts
|
95
|
vi
EXHIBITS
|
|
Exhibit
A
|
2007
Budget
|
Exhibit
B
|
Act
of Cash Sale
|
Exhibit
C
|
Assignment
and Assumption Agreement
|
Exhibit
D
|
Xxxx
of Sale
|
Exhibit
E
|
Chinese
Trademark License Agreement
|
Exhibit
F
|
Patent
Assignment
|
Exhibit
G
|
Purchaser
Master Supply Agreement
|
Exhibit
H
|
Purchaser’s
Knowledge
|
Exhibit
I
|
Sellers’
Knowledge
|
Exhibit
J
|
Trademark
Assignment
|
Exhibit
K
|
Accounts
Payable Note
|
Exhibit
L
|
Accounts
Receivable Note
|
Exhibit
M
|
Survey
Requirements
|
Exhibit
N
|
Form
of Legal Opinion
|
Exhibit
China
|
Chinese
Employee Arrangements
|
SCHEDULES
|
|
Schedule
1.1(a)
|
Business
Employees
|
Schedule
1.1(b)
|
Business
Guarantees
|
Schedule
1.1(c)
|
Calculation
Principles
|
Schedule
1.1(d)
|
Chemtura
Master Supply Agreement Products
|
Schedule
1.1(e)
|
Designated
Agreements
|
Schedule
1.1(f)
|
Geismar
Facility
|
Schedule
1.1(g)
|
Geismar
Retained Land
|
Schedule
1.1(h)
|
License
Agreements
|
Schedule
1.1(i)
|
Monochem
Facility
|
Schedule
1.1(j)
|
Naugalube
Equipment
|
Schedule
1.1(k)
|
Net
Working Capital Threshold Amount
|
Schedule
1.1(l)
|
Non-U.S.
Employees
|
Schedule
1.1(m)
|
Permitted
Liens
|
Schedule
1.1(n)
|
Purchaser
Master Supply Agreement Products
|
Schedule
1.1(o)
|
Rubber
Chemicals Business
|
Schedule
1.1(p)
|
Shared
Contracts
|
Schedule
2.1(d)
|
Naugatuck
Equipment
|
Schedule
2.1(f)(i)
|
Transferred
Trademarks
|
Schedule
2.1(f)(ii)
|
Transferred
Technology
|
Schedule
2.1(f)(iii)
|
Transferred
Patents
|
Schedule
2.1(g)
|
Transferred
IT Assets
|
Schedule
2.2
|
Assigned
Permits
|
Schedule
2.2(a)
|
Transferred
IT Contracts
|
Schedule
2.2(b)
|
Other
Contracts
|
Schedule 2.4(k) | Intercompany Agreements |
vii
Schedule
2.4(p)
|
Retained
IT Assets
|
Schedule
3.2(b)
|
Additional
Adjustments
|
Schedule
4.3(a)
|
Governmental
Consents
|
Schedule
4.3(b)
|
Other
Consents
|
Schedule
4.4
|
Financial
Statements
|
Schedule
4.5
|
No
Adverse Effects or Changes
|
Schedule
4.6
|
Title
to Assets
|
Schedule
4.7(a)
|
Sufficiency
of Assets
|
Schedule
4.7(b)
|
Condition
of Assets
|
Schedule
4.8(a)
|
Real
Property
|
Schedule
4.8(c)
|
Leased
Real Property
|
Schedule
4.9(a)
|
Equipment
- EPDM Business
|
Schedule
4.9(b)
|
Equipment
- Rubber Chemicals Business
|
Schedule
4.9(c)
|
PPD
Equipment
|
Schedule
4.9(d)
|
Leased
Personal Property
|
Schedule
4.9(e)
|
Production
Changes
|
Schedule
4.10(a)
|
Relations
with Customers and Suppliers
|
Schedule
4.10(b)
|
Material
Customers and Material Suppliers
|
Schedule
4.11(a)
|
Accounts
Receivable
|
Schedule
4.11(b)
|
Security
Deposits
|
Schedule
4.12
|
Proceedings
|
Schedule
4.13(a)
|
Application
and Registration Numbers
|
Schedule
4.13(b)(i)
|
Licenses
In
|
Schedule
4.13(b)(ii)
|
Licenses
Out
|
Schedule
4.13(b)(iii)
|
IP
Royalty Payments
|
Schedule
4.13(c)
|
Infringement
and Liens
|
Schedule
4.13(h)
|
Intellectual
Property Agreements Restricting Disposition of
Inventory
|
Schedule
4.14(a)
|
Material
Contracts
|
Schedule
4.14(b)
|
Force
and Effect of Material Contracts
|
Schedule
4.15
|
Permits
|
Schedule
4.16(a)
|
Inventory;
Locations
|
Schedule
4.16(b)
|
Inventory
Consigned to Third Parties
|
Schedule
4.16(c)
|
Inventory
Held on Consignment
|
Schedule
4.16(d)
|
Inventory;
Physical Possession
|
Schedule
4.17(a)
|
Benefit
Plans
|
Schedule
4.19
|
Taxes
|
Schedule
4.20
|
No
Defaults or Violations
|
Schedule
4.21
|
Environmental
Matters
|
Schedule
4.21(b)
|
Environmental
Permits
|
Schedule
4.21(i)
|
Releases
of Hazardous Substances
|
Schedule
4.22
|
Conduct
of the Business
|
Schedule
4.24
|
Budgeted
EBITDA for the EPDM Business
|
Schedule
5.3
|
Purchaser
Consents
|
Schedule
6.2
|
Preservation
of Business
|
Schedule
6.12
|
Purchaser’s
Option
|
viii
Schedule
6.14
|
Chemtura’s
Option
|
Schedule
6.15
|
Decommissioning
of Wastewater Tank
|
Schedule
6.17(a)
|
Report
of Independent Auditors
|
Schedule
6.21
|
Intellectual
Property Rights Actions
|
Schedule
6.24
|
Key
Employees
|
Schedule
7.11
|
Contracts
to be Terminated
|
Schedule
7.14
|
Resolution
of Title V Violation
|
Schedule
11.1(a)
|
Excluded
Business Employees
|
Schedule
11.1(b)
|
Connecticut
Employees
|
Schedule
11.4
|
Applicable
Products
|
Schedule
11.5
|
Retention
Payments
|
Schedule
11.7
|
Foreign
Employees and Applicable Foreign Benefit Plans
|
Schedule
12.9(a)
|
Conduct
and Control
|
ix
THIS
ASSET PURCHASE AND SALE AGREEMENT is made as of the 3rd day of February,
2007 by
and among Lion Copolymer, LLC, a limited liability company organized under
the
laws of the State of Delaware (the “Purchaser”),
CHEMTURA CORPORATION, a corporation organized under the laws of the State
of
Delaware (“Chemtura”),
CHEMTURA
CANADA CO./CIE,
a
corporation organized under the laws of Nova Scotia, CHEMTURA
INDUSTRIA QUIMICA DO BRASIL LIMITADA,
a
limited liability company organized under the laws of Brazil, CHEMTURA
ITALY S.R.L.,
a
limited liability company organized under the laws of Italy, CHEMTURA
CORPORATION, S.A. DE C.V., a limited liability corporation organized under
the
laws of Mexico, CHEMTURA
NETHERLANDS B.V.,
a
private company with limited liability organized under the laws of the
Netherlands, MONOCHEM,
INC.,
a
corporation organized under the laws of the State of Louisiana (“Monochem”),
and
UNIROYAL CHEMICAL TAIWAN LTD., a limited liability company organized under
the
laws of Taiwan.
WITNESSETH:
WHEREAS,
the Purchaser desires to purchase from the Sellers (as defined below), and
the
Sellers desire to sell to the Purchaser, certain assets used in the conduct
of
the Business (as defined below) by the Sellers, and the Purchaser desires
to
assume from the Sellers, and the Sellers desire to assign to the Purchaser,
certain obligations and liabilities relating to the Business, all upon the
terms
and subject to the conditions contained herein.
NOW,
THEREFORE, in consideration of the foregoing and the mutual representations,
warranties, covenants and agreements herein contained, the Purchaser and
the
Sellers hereby agree as follows:
ARTICLE
1.
DEFINITIONS
1.1 Definitions.
The
following terms shall have the following meanings for the purposes of this
Agreement:
“2006
EPDM EBITDA”
shall
mean the EBITDA for the EPDM Business for the year ended December 31, 2006
determined in accordance with the Calculation Principles and as set forth
on the
Reconciliation.
“2006
Pre-Signing Financial Statements”
shall
have the meaning set forth in Section
4.4,
subject
to revision pursuant to Section
6.29.
“2006
Rubber Chemicals EBITDA”
shall
mean the EBITDA for the Rubber Chemicals Business for the year ended December
31, 2006 determined in accordance with the Calculation Principles and as
set
forth on the Reconciliation.
“2007
Budget”
shall
mean the budgets for each of the EPDM Business and the Rubber Chemicals Business
for the year ending December 31, 2007 prepared by Chemtura and attached hereto
as Exhibit A.
“Accounting
Firm”
shall
have the meaning set forth in Section 3.2(c)(iv).
“Accounts
Payable”
shall
have the meaning set forth in Section 2.6(b).
“Accounts
Payable Note”
shall
have the meaning set forth in Section 3.1(a)(ii).
“Accounts
Receivable”
shall
mean (a) all trade accounts receivable and other rights to payment from
customers of any Seller to the extent arising out of or related to the Business
or the Assets and the full benefit of all security for such accounts or rights
to payment, including all trade accounts receivable representing amounts
receivable in respect of goods shipped or products sold or services rendered
to
customers of any Seller to the extent arising out of or related to the Business
or the Assets, (b) all other accounts or notes receivable of any Seller to
the
extent arising out of or related to the Business or the Assets and the full
benefit of all security for such accounts or notes and (c) any claim, remedy
or
other right related to any of the foregoing, but excluding any such items
in (a)
through (c) above to the extent arising out of or relating to the PPD Products
manufactured at the Non-U.S. Facilities (except those sold to Manufacture
Française des Pneumatiques Michelin or Continental AG or
their
respective Affiliates, which for the avoidance of doubt are Accounts Receivable
for all purposes of this Agreement and are not Retained PPD
Receivables) (the
“Retained
PPD Receivables”).
“Accounts
Receivable Note”
shall
have the meaning set forth in Section
6.28.
“Acquired
Rights Directive”
shall
have the meaning set forth in Section
11.7(a).
“Act
of
Cash Sale”
shall
mean an act of cash sale or other transfer/deed of land to be delivered at
the
Closing by the applicable Seller conveying to the Purchaser the Transferred
Owned Real Property owned by such Seller, substantially in the form set forth
in
Exhibit
B.
“Affiliate”
shall
mean, with respect to any specified Person, any other Person which, directly
or
indirectly, controls, is under common control with or is controlled by such
specified Person. The term “control”
as
used
in the preceding sentence shall mean, (a) with respect to a corporation or
other business entity, the right to exercise, directly or indirectly, more
than
(i) 50% of the voting rights attributable to the shares or other ownership
interests of such corporation or other business entity or (ii) for purposes
of
Sections
4.14(a)(v)
and
6.2(d),
20% of
the voting rights attributable to the shares or other ownership interests
of
such corporation or other business entity, or (b) with respect to any
Person other than a corporation, the possession, directly or indirectly,
of the
power to direct or cause the direction of the management or policies of such
Person.
“Agreement”
shall
mean this Asset Purchase and Sale Agreement, including all Exhibits and
Schedules hereto.
“Antitrust
Division”
shall
mean the Antitrust Division of the United States Department of
Justice.
“Area
of Concern”
or
“AOC”
shall
mean those areas described as “Areas of Concern” in the Phase II and shall
include any additional or new Areas of Concern that may arise out of or be
designated as a part of the Phase II.
2
“Assets”
shall
mean the Purchased Assets, the Assigned Permits
and
the Purchased Contracts.
“Assigned
Permits”
shall
have the meaning set forth in Section 2.2.
“Assignment
and Assumption Agreement”
shall
mean an assignment and assumption agreement substantially in the form set
forth
in Exhibit
C.
“Assumed
Obligations”
shall
have the meaning set forth in Section 2.5.
“Audited
Special Purpose Financial Statements”
shall
have the meaning set forth in Section 6.17(a).
“Benefit
Plan”
shall
have the meaning set forth in Section 4.17(a)(i).
“Benefit
Program”
shall
have the meaning set forth in Section 4.17(a)(ii).
“Xxxx
of Sale”
shall
mean a xxxx of sale substantially in the form set forth in Exhibit
D.
“Bulk
Sales Laws”
shall
mean the bulk-transfer provisions of the Uniform Commercial Code (or any
similar
Law).
“Business”
shall
mean, collectively, the EPDM Business, the Monochem Business and the Rubber
Chemicals Business, excluding the Excluded Assets and the Retained
Obligations.
“Business
Day”
shall
mean any day of the year other than (a) any Saturday or Sunday or (b) any
other
day on which banks located in New York, New York are required or authorized
to
be closed for business.
“Business
Employees”
shall
mean all employees of any of the Sellers or their Affiliates who, immediately
prior to the Closing Date, (a) are non-manufacturing employees and work
exclusively in connection with the Business and are listed on Schedule
1.1(a),
(b) are
employed at the Geismar Facility or (c) are employed by the Chinese Joint
Venture, including, in each case, any such employee on a leave of absence
or who
is not otherwise actively at work. For the avoidance of doubt, Chemtura’s Vice
President and General Manager, Process Chemicals and Polymers, shall not
be
deemed to be a Business Employee.
“Business
Guarantee”
shall
mean any guarantee, indemnity, performance bond, letter of credit, deposit
or
other security or contingent obligation in the nature of a financial obligation,
including letters of comfort or support, entered into or granted by any Seller
or any of their Affiliates in relation to or arising out of any Liabilities
of
any Seller or any of their Affiliates in connection with the Business that
is
set forth on Schedule 1.1(b).
“Business
Material Adverse Effect”
shall
mean any (i) change in or effect on the condition (financial or otherwise),
business, results of operations or assets and liabilities of the Business,
taken
as a whole, that is material and adverse to the Business or (ii) change or
effect that prevents the consummation by any of the Sellers of any of the
transactions contemplated by this Agreement; provided,
however,
that
none of the following shall be deemed to constitute and none of the following
shall be taken into account in determining whether there has been a Business
Material Adverse Effect: any adverse change or effect arising from or relating
to (a) general business or economic conditions, (b) national or
international political or social conditions, including the engagement by
the
United States in war or major hostilities or the occurrence of any terrorist
attack upon the United States, (c) the taking of any action contemplated by
this Agreement or any Related Agreement or consented to by the Purchaser
or
(d) the disclosure of this Agreement or any Related Agreement or the
transactions contemplated hereby or thereby as permitted by this Agreement
and
the Confidentiality Agreement, except in the case of clause (a) or (b) to
the
extent the Business suffers a disproportionately adverse impact from such
adverse change or effect as compared to other businesses in the same
industry.
3
“Business
Portion”
shall
have the meaning set forth in Section 2.3(c).
“Calculation
Principles”
shall
mean the accounting principles set forth on Schedule 1.1(c),
as
applied on a consistent basis by the Sellers, subject to revision pursuant
to
Section
6.29.
“Chemtura”
shall
have the meaning set forth in the Preamble.
“Chemtura
Master Supply Agreement”
shall
mean a master supply agreement between the Purchaser and Chemtura with respect
to the supply to the Purchaser by Chemtura of the products set forth on
Schedule 1.1(d)
in a
form to be agreed to between Chemtura and the Purchaser in accordance with
Section
6.25.
“Chemtura
Names”
shall
mean the business names, brand names, trade names, trademarks, service marks
and
domain names “Chemtura,” “Crompton,” “Great Lakes” and “Uniroyal,” any business
name, brand name, trade name, trademark, service xxxx or domain name that
includes “Chemtura,” “Crompton,” “Great Lakes” or “Uniroyal,” any portion
thereof, any and all other derivatives thereof and any and all logos
consistently used by Sellers in combination therewith prior to the
Closing.
“Chinese
Consents”
shall
mean the Consents required to be obtained from the relevant Governmental
Authorities in connection with a transfer of an equity interest in the Chinese
Joint Venture.
“Chinese
Joint Venture”
shall
mean Chemtura-CNCCC Danyang Chemical Company, Limited (CCDCCL), a
Chinese-foreign equity joint venture registered in the People’s Republic of
China formed pursuant to that certain Equity Joint Venture Contract, dated
August 19, 2000, as amended from time to time.
“Chinese
Joint Venture Assets”
shall
have the meaning set forth in Section 4.6(b).
“Chinese
Joint Venture Intellectual Property”
shall
mean all Intellectual Property owned by the Chinese Joint Venture.
“Chinese
Trademark License Agreement”
shall
mean a trademark license agreement between Chemtura and the Purchaser,
substantially in the form set forth in Exhibit
E.
4
“Claim
Notice”
shall
have the meaning set forth in Section 12.5.
“Closing”
shall
mean the consummation of the transactions contemplated herein as contemplated
by
Article
9.
“Closing
Date”
shall
mean the date on which the Closing occurs.
“Closing
Proration Amount”
shall
have the meaning set forth in Section 2.7.
“Closing
Statement”
shall
have the meaning set forth in Section 3.2(c)(ii).
“Closing
Working Capital Amount”
shall
mean the Working Capital as of the Closing Date set forth on the final Closing
Statement.
“Code”
shall
mean the United States Internal Revenue Code of 1986, as amended.
“Competing
Business”
shall
have the meaning set forth in Section 6.11(a)(i).
“Confidential
Information”
shall
have the meaning set forth in Section 6.8(c).
“Confidentiality
Agreement”
shall
mean the confidentiality agreement, dated August 2, 2006, between Chemtura
and
Lion Chemical Capital, LLC.
“Consent”
shall
mean a consent, authorization or approval of a Person, or a filing or
registration with a Person.
“Contract”
shall
mean a contract, lease, license, sales order, purchase order, indenture,
mortgage, note, bond, warrant, instrument or other agreement, arrangement,
understanding or commitment that is binding on a Person or its
property.
“Current
Liabilities”
shall
mean all current liabilities of the Sellers reflected in the most recent
Pre-Signing Financial Statements and current liabilities of the type described
therein arising in the ordinary course and in accordance with this Agreement
from September 30, 2006 through the Closing, in each case to the extent arising
out of or with respect to the Assets or the Business and determined in
accordance with the Calculation Principles, but excluding any current
liabilities of the Sellers that (i) are part of the Retained Obligations,
(ii) relate to any of the proceedings listed on Schedule
4.12,
(iii) arise out of or with respect to the Excluded Assets or (iv) are
otherwise contemplated to be retained by the Sellers hereunder.
“Debt
Financing”
shall
have the meaning set forth in Section 5.5(a).
“Designated
Agreements”
shall
mean those agreements specified in Schedule
1.1(e).
“Disclosing
Party”
shall
have the meaning set forth in Section 6.8(d).
“Dollars”
or
numbers preceded by the symbol “$” shall mean amounts in United States
dollars.
5
“EBITDA”
means
earnings before taxes, interest income and expense, depreciation and
amortization expense, determined in accordance with the Calculation Principles,
applied in a manner consistent with the preparation of the Pre-Signing Financial
Statements.
“Employee
Exhibit”
shall
mean Exhibit
China
and any
other applicable employee Exhibit pursuant to Section
11.3.
“Encumbrance”
shall
mean, with respect to the Transferred Owned Real Property, a Lien, lease,
license, covenant, option, restriction, easement, servitude, right of way
or
other encumbrance or title defect.
“Enforceability
Limitations”
shall
mean limitations on enforcement and other remedies imposed by or arising
under
or in connection with applicable bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium and other similar Laws affecting creditors’ rights
generally from time to time in effect or general principles of
equity.
“Environmental
Claim”
shall
mean any notice or Proceeding commenced by or threatened in writing by a
Governmental Authority or Person against any Purchaser Indemnified Party
or
Seller Indemnified Party, as the case may be, that claims the existence of
an
Environmental Violation or asserts or alleges any Environmental
Liabilities.
“Environmental
Law”
shall
mean all Laws governing or relating to pollution or protection of human health
and safety (including worker health and safety) or the environment (including
ambient air, surface water, ground water, land, surface or subsurface
strata,
and
natural resources), including: (i) those providing liability in connection
with
or imposing cleanup, investigatory or remediation obligations relative to
any
Release or threatened Release of Hazardous Substances; and (ii) those otherwise
relating to any environmental aspect of the manufacture, processing,
distribution, use, treatment, storage, disposal, emission, discharge, transport
or handling of Hazardous Substances (including, without limitation, the federal
Occupational Safety and Health Act, and any supernational, regional, state,
local or provincial counterparts or analogues thereto).
“Environmental
Liability”
shall
mean any and all Losses, Liabilities, costs (including investigative,
monitoring, containment, disposal and remediation costs and court costs and
other costs of administrative or judicial proceedings), fines and penalties,
judgments, awards or damages (including personal injury and property damages
based on or arising out of exposure to Hazardous Substances), natural resource
damages and assessments, third party claims, injunctive relief (including
the
costs of equipment and controls required to restore the operations to compliance
with Environmental Law as in effect on the Closing) including fees (including
reasonable attorney, expert, engineering and consultant fees) arising under
or
with respect to (a) any Environmental Laws or (b) any Environmental
Violations.
“Environmental
Permit”
shall
mean all Permits under any Environmental Laws for the lawful operation of
the
Business as it was conducted immediately prior to the Closing Date.
“Environmental
Violations”
shall
mean any and all acts, omissions, conditions, Releases, or incidents related
to
the operations of the Sellers (before the Closing) or the Purchaser or
subsequent owners or operators (after the Closing) at the Geismar Facility
or
the Monochem Facility or the operations of the Chinese Joint Venture that
violate any Environmental Law.
6
“EPDM
Business”
shall
mean the Sellers’ business of producing, marketing and selling ethylene
propylene diene monomer rubber and ethylene propylene copolymer and terpolymer
rubber.
“Equity
Financing”
shall
have the meaning set forth in Section
5.5(b).
“ERISA”
shall
mean the United States Employee Retirement Income Security Act of 1974, as
amended.
“ERISA
Affiliate”
shall
mean, with respect to any Person, any corporation, trade or business which,
together with such Person, is a member of a controlled group of corporations
or
a group of trades or businesses under common control within the meaning of
section 414 of the Code.
“ERISA
Group”
shall
have the meaning set forth in Section 4.17(d).
“Estimated
Closing Statement”
shall
have the meaning set forth in Section 3.2(c)(i).
“Estimated
Working Capital Amount”
shall
have the meaning set
forth
in Section 3.2(c)(i).
“Evaluation
Material”
shall
have the meaning set forth in Section 13.18.
“Excluded
Assets”
shall
have the meaning set forth in Section 2.4.
“Factored
Accounts Receivable”
shall
mean the Foreign Accounts Receivable that, as of 12:00:01 a.m. (eastern time)
on
the Closing Date, shall have been converted to cash following the factoring
of
such receivables by the applicable Sellers pursuant to the General Conditions
for Factoring Operations, dated June 25, 2003, between Crompton Chemical
S.R.L.
and Mediofactoring SpA; General Conditions for Factoring Operations, dated
June
25, 2003, between Crompton Europe B.V. and Mediofactoring SpA; General
Conditions for Factoring Operations, dated June 25, 2003, between Crompton
VA
GmbH and Mediofactoring SpA and General Conditions for Factoring Operations,
dated June 25, 2003, between Crompton GmbH and Mediofactoring SpA.
“Financeability
Letter”
shall
have the meaning set forth in Section
5.5(a).
“FIRPTA”
shall
mean the Foreign Investment Real Property Tax Act, as amended.
“Foreign
Accounts Receivable”
shall
mean all Accounts Receivable of Chemtura Italy S.R.L., Chemtura Corporation,
S.A. de C.V., Chemtura Industria Quimica do Brasil Limitada, Uniroyal Chemical
Europe B.V. and Uniroyal Chemical Taiwan Ltd.
7
“Foreign
Benefit Plans”
shall
mean any employee benefit plan, contract, program, policy or arrangement
(including any type of plan or arrangement described in Section
4.17(a))
for the
benefit
of
any Non-U.S. Employee.
“Foreign
Implementation Agreements”
means
the various agreements to be executed by the
Purchaser
(or its
designated Affiliates), on the one hand, and the applicable Sellers, on the
other hand, for the purpose of implementing the transfer and conveyance on
the
Closing Date of certain Purchased Assets and Assumed Obligations in Mexico
and
Brazil to the Purchaser (or its designated Affiliates) by the applicable
Sellers, if the parties determine that such agreements are necessary in order
to
comply with applicable Law.
“FTC”
shall
mean the Federal Trade Commission.
“GAAP”
shall
mean accounting principles generally accepted in the United States.
“Geismar
Facility”
shall
mean the Real Property owned by Chemtura and located at 00000 Xxxxxxx 00,
Xxxxxxx, Xxxxxxxxx 00000 and as more particularly described on Schedule 1.1(f),
excluding the Geismar Retained Land.
“Geismar
Landfill”
shall
mean the closed landfill at the Geismar Facility, more particularly described
as
Cell A and Cell B and covered by the RCRA Permit.
“Geismar
Response Action Costs”
shall
mean any and all costs and expenses incurred in connection with the Geismar
Response Actions, including: costs and expenses of environmental consultants;
costs and expenses of treating and disposing of Hazardous Substances; costs
and
expenses of conducting sampling and monitoring; and reimbursements of costs
and
expenses incurred by any Governmental Authority relating to any of the foregoing
excluding (a) any lost profits arising from a temporary shutdown of the Geismar
Facility in order to undertake any response actions and (b) any internal
personnel costs of the Purchaser for overseeing the Geismar Response Action
(other than, for the avoidance of doubt, costs that the Purchaser incurs
subject
to paragraph 2.1 of Schedule
12.9(a)).
As
used herein, the term “temporary” shall mean a shut down or shut downs of no
more than 48 hours total over a running 365 day annual period, but the term
“shut down” shall not include any periods of time when the Geismar Facility is
shut down for reasons unrelated to the Geismar Response Actions.
“Geismar
Response Actions”
shall
mean those actions conducted under the supervision of any applicable
Governmental Authority on or after the Closing Date, to implement RCRA
corrective action obligations at the Geismar Facility arising out of actions,
events or circumstances that occurred before the Closing Date, including
any
investigation and/or remediation obligations contained in the Geismar Facility’s
Modified Hazardous Waste Post-Closure Permit, dated March 23, 1998, Permit
No. LAD008194060-PC-1 (the “RCRA
Permit”),
and
any RCRA Permit renewal.
“Geismar
Retained Land”
shall
mean the parcel of Real Property located in close proximity to the Geismar
Facility and as more particularly shown on Schedule 1.1(g).
“Governmental
Authority”
shall
mean any federal, state, provincial, local or foreign government or subdivision
thereof, or any entity, body or authority exercising executive, legislative,
judicial, regulatory or administrative functions of or pertaining to any
federal, state, provincial, local or foreign government.
8
“Governmental
Required Consent”
shall
mean, with respect to a Person, (i) the Chinese Consents related to the
transfer of the 100% equity interest in the Chinese Joint Venture from Chemtura
to the Purchaser and (ii) the approvals and consents required for the
transfer of any Environmental Permit.
“Ground
Lease”
shall
mean a ground lease between Chemtura and the Purchaser providing for the
lease
by Chemtura to the Purchaser of Building 112 located at the Naugatuck Site
in a
form to be agreed to between Chemtura and the Purchaser in accordance with
Section
6.25.
“Group
Contract”
shall
mean any Contract under which (a) the Business and (b) at least one other
business unit of any Seller or any of their respective Affiliates purchase
or
sell goods or services on a joint basis or otherwise have rights or
obligations.
“Hazardous
Substance”
shall
mean any chemical, pollutant, contaminant, waste, toxic or hazardous substance
or material, crude oil, petroleum and petroleum products or by-products,
polychlorinated biphenyls, asbestos or asbestos-containing materials, lead
or
lead-based paints or materials, free crystalline silicates or silica, natural
gas, natural gas liquids, liquefied natural gas, or synthetic gas usable
for
fuel (or mixtures of natural gas and such synthetic gas), or radioactive
material and any and all other terms of similar import, substances, or materials
including wastes that are identified, listed, regulated or as to which liability
may be imposed at any time under Environmental Laws whether or not such
substance or material is defined as hazardous under the Environmental
Laws.
“HSR
Act”
shall
mean the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of 1976, as
amended.
“Indemnified
Person”
shall
mean the Person or Persons entitled to, or claiming a right to, indemnification
under Article
12.
“Indemnifying
Person”
shall
mean the Person or Persons claimed by the Indemnified Person to be obligated
to
provide indemnification under Article
12.
“Information
and Records”
shall
have the meaning set forth in Section 2.1(e).
“Initial
Purchase Price”
shall
have the meaning set forth in Section 3.1(a)(i).
“Intellectual
Property”
shall
mean all of the following rights, title, or interest in or arising under
the
laws of the United States, any state, any other country, or international
treaty
regime, whether or not filed, perfected, registered, or recorded, including
all
renewals thereof: (i) certificates of invention and other indicia of
invention ownership, patents, patent applications, and patent rights, including
any such rights granted upon any reissue, reexamination, division, extension,
provisional, continuation, or continuation-in-part applications, and equivalent
or similar rights anywhere in the world in inventions and discoveries; (ii)
rights associated with works of authorship and literary property rights,
including copyrights, copyright applications and copyright registrations,
and
moral rights; (iii) rights relating to know-how or trade secrets, including
ideas, concepts, methods, techniques, inventions (whether patentable or
unpatentable), and other works, whether or not developed or reduced to practice,
rights in industrial property, customer, vendor, and prospect lists, and
all
associated information or databases, and other confidential or proprietary
information; (iv) trademarks, service marks, logos, images, trade dress,
domain
names, trade names, and service names, whether or not registered, and the
goodwill associated therewith; and (v) any rights analogous to those set
forth
in the preceding clauses and any other proprietary rights relating to intangible
property anywhere in the world, including all intellectual property rights
in
and to customer lists, databases, data collections, engineering data,
manufacturing and production processes and procedures, design documents and
analyses, diagrams, documentation, drawings, formulae, marketing plans,
methodologies, processes, program listings, protocols, sales data, schematics,
specifications, computer data, computer programs and software (in any form
including source code and executable or object code), web sites, and other
forms
of technology (whether or not embodied in any tangible form and including
all
tangible embodiments of the foregoing such as blueprints, compilations of
information, instruction manuals, notebooks, prototypes, reports, samples,
studies, and summaries).
9
“Intellectual
Property Claim”
shall
mean the assertion by any Person of a claim (whether asserted in writing,
by
action, suit or proceeding or otherwise) that any Seller’s ownership, use,
marketing, sale or distribution of any Inventory, equipment, Intellectual
Property or other Property is violative of any ownership of or right to use
any
Intellectual Property of such Person.
“Interim
Financial Statements”
shall
have the meaning set forth in Section
6.17(b).
“Inventory”
shall
mean (a) all supplies, materials and other inventories of raw materials and
works-in-progress owned by the Sellers and located at the Geismar Facility,
to
the extent used or held for use in the Business and (b) all inventories of
finished goods owned by the Sellers wherever located, including any inventories
on consignment and any inventories located in warehouses or similar facilities,
to the extent used in or held for use or sale by or in the Business, other
than
the Retained PPD Inventory.
“IRS”
shall
mean the United States Internal Revenue Service.
“Known
Pre-Closing Environmental Liabilities”
shall
mean all Environmental Liabilities, Environmental Claims or Losses including
the
Geismar Response Action Costs based on, arising out of, or related to the
Geismar Landfill, the Wastewater Tank Decommissioning Action Costs, the Phase
II, the Sellers’ Financial Assurance Obligations, the AOCs and the
SWMUs.
“Law”
shall
mean (a) the civil code and all treaties, laws, statutes, and ordinances
(including common law) of any Governmental Authority and (b) any order,
injunction, judgment, directive, rule or regulation of any Governmental
Authority of competent jurisdiction, having the effect of law.
“LDEQ”
shall
mean the Louisiana Department of Environmental Quality.
“Leased
Real Property”
shall
have the meaning set forth in Section
4.8(c).
10
“Liabilities”
shall
mean any and all debts, liabilities, obligations, commitments, responsibilities,
fines, penalties and sanctions, absolute or contingent, matured or unmatured,
liquidated or unliquidated, joint, several or individual, asserted or
unasserted, accrued or unaccrued, known or unknown, due or to become due,
whenever arising, including any costs, expenses, interest, reasonable attorneys’
fees, disbursements and expense of counsel, expert and consulting fees and
costs
related thereto or to the investigation
or defense thereof.
“LIBOR
Rate”
shall
have the meaning set forth in Section 3.2(c)(vii).
“License
Agreements”
shall
mean (a) the Chinese Trademark License Agreement and (b) the license agreements
pursuant to which the Sellers will license to the Purchaser the Intellectual
Property, if any, used in and necessary for the conduct of, or developed
primarily for use in, the Business as it is presently conducted and not
transferred to the Purchaser as part of the Transferred Intellectual Property,
including the Intellectual Property set forth in part A of Schedule 1.1(h),
and the
license agreement or agreements pursuant to which the Purchaser will license
the
patents and trademarks set forth in part B of Schedule 1.1(h)
to
Chemtura, in
the
case of clause (b) in a form to be agreed to between Chemtura and the Purchaser
in accordance with Section
6.25.
“Lien”
shall
mean, for any property or asset of a Person, a lien, security interest,
mortgage, pledge, charge, servitude or encumbrance in, of or on such property
or
asset in favor of any other Person, except those in favor, or for the benefit,
of the Purchaser. The term “Lien” shall also include title exceptions and
encumbrances affecting Real Property, including reservations, exceptions,
encroachments, easements, servitudes, rights-of-way, covenants, conditions,
restrictions and leases.
“Loss”
or
“Losses”
shall
mean any and all Liabilities, damages, awards, judgments, losses, settlement
payments, Taxes, reasonable costs and reasonable expenses (including reasonable
fees for legal, accounting and similar expenses, court costs and other costs
of
administrative proceedings or litigation), fines or penalties, in each case
whether known or unknown, suspected or unsuspected.
“Material
Contracts”
shall
have the meaning set forth in Section 4.14(b).
“Material
Customer”
shall
have the meaning set forth in Section 4.10.
“Material
Licenses”
shall
have the meaning set forth in Section 4.13(b).
“Material
Supplier”
shall
have the meaning set forth in Section 4.10.
“Monochem”
shall
have the meaning set forth in the Preamble.
“Monochem
Business”
shall
mean the provision of plant utilities services as currently conducted by
Monochem.
“Monochem
Facility”
shall
mean the Real Property owned by Monochem and located at 0000 Xxxxxxx 00,
Xxxxxxx, Xxxxxxxxx and as more particularly described on Schedule 1.1(i).
11
“Naugalube
Equipment”
shall
mean all equipment, machinery and spare parts owned by a Seller and used
or held
for use exclusively for the production of Naugalube® 438 L and Naugard® FA33 and
located at the Geismar Facility, and in each case as set forth on Schedule 1.1(j).
“Naugalube
Intellectual Property”
shall
mean all Intellectual Property owned by a Seller and used or held for use
primarily for the production of Naugalube® 438L or Naugard® FA33.
“Naugatuck
Equipment”
shall
have the meaning set forth in Section 2.1(d).
“Naugatuck
Site”
shall
mean the facilities of Chemtura and its Affiliates located in Naugatuck,
Connecticut.
“Naugatuck
Technical Service Equipment”
shall
have the meaning set forth in Section 6.13(a).
“Net
Working Capital Threshold Amount”
shall
mean (a) $54,500,000 (comprising (i) Working Capital of the EPDM Business
and
the Monochem Business of $38,600,000, plus
(ii)
Accounts Receivable of the Rubber Chemicals Business of $15,900,000),
plus
(b)
$8,900,000 (comprising (i) an estimate of Inventory of the Rubber Chemicals
Business of $16,800,000, less
(ii) an
estimate of Accounts Payable of the Rubber Chemicals Business of $7,900,000),
in
each case subject to adjustment pursuant to Section
6.29.
As of
the Closing, the amount in clause (b) of this definition shall be replaced
with
an amount equal to (A) the actual Inventory of the Rubber Chemicals Business
as
of the Closing Date as calculated in accordance with the methodology set
forth
in Schedule
1.1(k),
less
(B) the
actual Accounts Payable of the Rubber Chemicals Business as of the Closing
Date
as calculated in accordance with the methodology set forth in Schedule
1.1(k).
“Non-Business
Portion”
shall
have the meaning set forth in Section 2.3(c).
“Non-U.S.
Employee”
shall
mean any Business Employee who (a) is employed by the Chinese Joint Venture
or
(b) whose primary place of employment is in a non-U.S. jurisdiction and who
is
identified as a Non-U.S. Employee on Schedule
1.1(l).
“Non-U.S.
Facilities”
shall
mean the applicable Seller’s facility located at each of the following
locations: (a) K.M. 14.5 Xxxx. Tampico-Altamira, Col. Laguna De La Puerta,
Altamira, Tamaulipas, Mexico; (b) 5333-Caixa Postal 000, Xxx Xxxxx, Xxx
Xxxxx, Xxxxxx; (c) 3-1 Xxxxx Xxxx Xxxx, Xx Xxx Xxxxxxxxxx Xxxx, Xxxxxxxxx,
Xxxxxx; and (d) Xxx Xxxx Xxxxx Xxxxxxxxx Xx. 0, Xxxxxx Xxxxx,
Xxxxx.
“Notice
of Acceptance”
shall
have the meaning set forth in Section 3.2(c)(iii)(A).
“Notice
of Disagreement”
shall
have the meaning set forth in Section 3.2(c)(iii)(B).
“Offered
Employees”
shall
have the meaning set forth in Section 11.1.
“Offers
of Employment”
shall
have the meaning set forth in Section 11.1.
12
“Other
Chemtura Business”
shall
mean any current or former business or operations of Chemtura or any of its
Affiliates other than the Business.
“Outbound
Licenses”
shall
have the meaning set forth in Section 4.13(b).
“Patent
Assignment”
shall
mean a patent assignment by the applicable Seller in favor of the Purchaser
substantially in the form set forth in Exhibit
F.
“PBGC”
shall
have the meaning set forth in Section 4.17(d).
“Permit”
shall
mean all registrations, filings, permits, Consents, licenses, certificates,
variances and similar rights granted by or obtained from any Governmental
Authority.
“Permitted
Liens”
shall
mean: (a) Liens for Taxes that are not yet delinquent or that are being
contested in good faith by appropriate Proceedings for which adequate reserves
have been established in accordance with the Calculation Principles and with
the
past practices of the Business; (b) workers’, mechanics’, materialmen’s,
repairmen’s, suppliers’, carriers’ or similar Liens arising in the ordinary
course of business with respect to obligations that are not yet delinquent;
(c) zoning or other similar governmental restrictions that do not
materially impair or interfere with the current use
of
such real property, leases or leasehold estates or the conduct of the Business;
(d) Liens that secure Assumed Obligations and are set forth in Schedule 1.1(m);
(e) Liens that do not secure any monetary obligations and that do not
materially impair the value of the property subject to such Lien or the use
of
such property in the conduct of the Business; (f) Liens arising from leases
of personal property that are Material Contracts; (g) Liens set forth in
Schedule
1.1(m)
and
(h) easements, servitudes, rights-of-way and any other matters disclosed in
the title policies for the Geismar Facility and the Monochem Facility delivered
to or obtained by the Purchaser or its lenders in connection with the
transactions contemplated by this Agreement and accepted by the
Purchaser.
“Person”
shall
mean any individual, corporation, proprietorship, firm, partnership, limited
partnership, limited liability company, trust, association or other
entity.
“Phase
II”
shall
mean all investigation or monitoring required as part of the RCRA
Facility Investigation Phase II Work Plan as
approved by the LDEQ in or about November 2006 including any additional
investigation, analysis, testing, or studies that arise out of, or relate
to the
implementation of or any results obtained from or that may be required as
a
follow-up to the RCRA Facility Investigation Phase II Work Plan.
“Pilot
Plant Equipment”
shall
have the meaning set forth in Section 6.13(b).
“PPD
Equipment”
shall
have the meaning set forth in Section 2.4(r).
“PPD
Products”
shall
mean antiozonant products produced from the chemical intermediate para-amino
di-phenyl amine, known as “4ADPA”.
“Pre-Closing
Tax Period”
shall
mean (a) with respect to U.S. federal or state income Taxes related to the
Chinese Joint Venture, any Tax period ending on or before the Closing Date
and
(b) with respect to any other Taxes, any Tax period ending before the
Closing Date.
13
“Pre-Closing
Tax Return”
shall
have the meaning set forth in Section 6.10(a)(i).
“Pre-Signing
Financial Statements”
shall
have the meaning set forth in Section 4.4.
“Premerger
Notification Provision”
shall
mean any provision of foreign Law requiring (a) the submission of
information and material to a Governmental Authority responsible for enforcing
the antitrust and competition Laws, regulating monopolies, substantial lessening
of competition, dominance and cartel conduct and (b) the parties to delay
the consummation of the Closing until the termination of a specified waiting
period or clearance and/or approval has otherwise been obtained. For the
avoidance of doubt, these filings only pertain to competition and not to
any
other regulatory or national security filing relating to a merger, acquisition
or joint venture.
“Privileged
Documents”
shall
mean attorney-work product, attorney-client communications and other items
protected by the attorney-client privilege.
“Proceeding”
shall
mean an action, suit or legal, administrative, arbitral or alternative dispute
resolution proceeding.
“Prohibited
Product”
shall
have the meaning set forth in Section 6.11(a)(i).
“Property”
shall
mean any interest in any kind of property or asset, whether real (immovable),
personal (movable) or mixed and whether tangible or intangible.
“Property
Taxes”
shall
have the meaning set forth in Section 6.10(c).
“Proposed
Adjustments”
shall
have the meaning set forth in Section 3.2(c)(iii)(B).
“Proposed
Transfer”
shall
have the meaning set forth in Section
13.6(b).
“Purchase
Price”
shall
have the meaning set forth in Section 3.1(a).
“Purchased
Assets”
shall
have the meaning set forth in Section 2.1.
“Purchased
Contracts”
shall
have the meaning set forth in Section 2.2.
“Purchaser”
shall
have the meaning set forth in the Preamble.
“Purchaser
Confidential Information”
shall
have the meaning set forth in Section 6.8(c).
“Purchaser
Indemnified Party”
shall
have the meaning set forth in Section 12.2.
“Purchaser
Master Supply Agreement”
shall
mean a master supply agreement between the Purchaser and Chemtura with respect
to the supply to Chemtura by the Purchaser of the products set forth on
Schedule 1.1(n)
produced
at the Geismar Facility, substantially in the form set forth in Exhibit
G.
“Purchaser’s
Financial Assurance Obligations”
shall
have the meaning set forth in Section
2.5(j).
14
“Purchaser’s
Knowledge”
or
any
similar expression with regard to the knowledge or awareness of or receipt
of
notice by the Purchaser, shall mean the actual knowledge of any of the Persons
listed on Exhibit H
after
reasonable inquiry of those senior employees of the Purchaser whom such Persons
reasonably believe would have actual knowledge of the matters
represented.
“Purchaser’s
Option”
shall
have the meaning set forth in Schedule
6.12.
“RCRA”
shall
have the meaning set forth in Section 2.5(j).
“RCRA
Permit”
shall
have the meaning set forth in the definition of Geismar Response
Actions.
“Real
Property”
means
all land and other immovable property, together with all buildings, structures,
improvements and fixtures thereon and all servitudes, easements and other
rights, benefits and interests appurtenant thereto.
“Receivables
Securitization Agreements”
means
(a) the Fourth Amended and Restated Receivables Sale Agreement, dated as of
September 28, 2006, among Crompton & Xxxxxxx Receivables Corporation,
Chemtura, ABN AMRO Bank N.V. and the other banks and liquidity providers
named
therein and (b) the Amended and Restated Receivables Purchase Agreement,
dated
as of September 28, 2006, among Crompton & Xxxxxxx Receivables Corporation,
Chemtura, Bio-Lab Inc. and Great Lakes Chemical Corporation, as consented
to by
ABN AMRO Bank N.V.
“Receiving
Party”
shall
have the meaning set forth in Section 6.8(d).
“Reconciliation”
shall
have the meaning set forth in Section
6.17(a).
“Registered
Intellectual Property”
shall
have the meaning set forth in Section 4.13(a).
“Related
Agreement”
shall
mean any Contract that is to be entered into at the Closing, including the
Accounts Payable Note, the Accounts Receivable Note, the Acts of Cash Sale,
the
Assignment and Assumption Agreement, the Xxxx of Sale, the Chemtura Master
Supply Agreement, the Foreign Implementation Agreements, the Ground Lease,
the
License Agreements, the Patent Assignment, the Purchaser Master Supply
Agreement, the Trademark Assignment and the Transition Services Agreement;
provided,
however,
that,
solely for purposes of Article
12
of this
Agreement, the term “Related Agreement” shall not include the Chemtura Master
Supply Agreement, the Ground Lease, the License Agreements, the Purchaser
Master
Supply Agreement and the Transition Services Agreement. The Related Agreements
executed by a specified Person shall be referred to as “such Person’s Related
Agreements,” “its Related Agreements” or other similar expression.
“Release”
shall
mean any release, spill, emission, overflow, leaking, pumping, pouring, dumping,
emptying, discharge, disposing, deposit, injection, escaping, leaching, seepage,
infiltration or migration, whether intentional or accidental, authorized
or
unauthorized, into the environment or into or out of any property.
15
“Relevant
Month”
means
the most recently completed calendar month ending at least five days prior
to
the Closing for which Interim Financial Statements shall be delivered to
the
Purchaser pursuant to Section
6.17(b).
“Representatives”
shall
mean, as to any Person, such Person’s Affiliates and its and their respective
directors, officers, members, employees, agents, advisors (including financial
advisors, counsel and accountants), shareholders, owners
and controlling persons.
“Restricted
Areas”
shall
have the meaning set forth in Section 12.9(a).
“Retained
IT Assets”
shall
have the meaning set forth in Section 2.4(p).
“Retained
Obligations”
shall
have the meaning set forth in Section 2.6.
“Retained
PPD Inventory”
shall
mean all finished goods inventory of PPD Products located at the Non-U.S.
Facilities and owned by a Seller.
“Retained
PPD Receivables”
shall
have the meaning set forth in the definition of Accounts
Receivable.
“Retained
Product Claims”
shall
have the meaning set forth in Section
2.6(i).
“Rubber
Chemicals Business”
shall
mean the Sellers’ business of producing, marketing and selling the products set
forth on Part A of Schedule 1.1(o)
and the
Sellers’ business of granulating, marketing and selling the products set forth
on Part B of Schedule 1.1(o),
but
excluding the marketing and sale of Celogen® OT and Celogen® AZ blends for use
in any application other than rubber, but including the business conducted
by
the Chinese Joint Venture.
“SAP
Letter Agreement”
shall
mean the letter agreement, dated December 28, 2006, as amended, between Chemtura
Corporation and Lion Chemical Capital, LLC, relating to certain SAP licenses
obtained by Chemtura and to be assigned to the Purchaser hereunder and
thereunder.
“Seller”
shall
mean, individually, Chemtura, Chemtura Canada Co./Cie, Chemtura Industria
Quimica do Brasil Limitada, Chemtura Italy S.r.l., Chemtura Corporation,
S.A. de
C.V., Chemtura Netherlands B.V., Monochem and Uniroyal Chemical Taiwan Ltd.,
and
the term “Sellers”
shall
mean all such entities collectively.
“Seller
Confidential Information”
shall
have the meaning set forth in Section 6.8(a).
“Seller
Indemnified Party”
shall
have the meaning set forth in Section 12.3.
“Seller
Plans”
shall
mean, collectively, the Benefit Plans and the Benefit Programs.
“Sellers’
Financial Assurance Obligations”
shall
have the meaning set forth in Section 2.6(h).
16
“Sellers’
Knowledge”
or
any
similar expression with regard to the knowledge or awareness of or receipt
of
notice by any Seller, shall mean the actual knowledge of any of the Persons
listed on Exhibit I
after
reasonable inquiry of those senior employees of any Seller whom such Persons
reasonably believe would have actual knowledge of the matters
represented.
“Sellers’
Offsite Environmental Liability”
shall
mean any Loss, Environmental Claims or Environmental Liabilities resulting
from
the Release of Hazardous Substances from any Property (i) in connection
with the operations of the Sellers at the Geismar Facility or the Monochem
Facility or the operations of the Chinese Joint Venture, in each case before
the
Closing Date, and (ii) at which any Seller (in connection with the
operations of the Geismar Facility or the Monochem Facility) by contract,
agreement or otherwise arranged for the disposal, storage or treatment of
Hazardous Substances generated, owned or possessed by any Seller or the Chinese
Joint Venture, including any such arrangement related to the Sellers’
obligations under this Agreement and (iii) at which the Chinese Joint
Venture by contract, agreement or otherwise arranged, prior to the Closing
Date,
for the disposal, storage or treatment of Hazardous Substances generated,
owned
or possessed by the Chinese Joint Venture.
“Shared
Contracts”
shall
mean those Group Contracts set forth on Schedule 1.1(p).
“Solid
Waste Management Unit”
or
“SWMU”
shall
mean those areas referred to as “Solid Waste Management Units” in the Phase II
and shall include any additional or new Solid Waste Management Units that
may
arise out of or be designated as a part of the Phase II.
“Straddle
Period”
means
any Tax period that begins before the Closing Date and ends on or after the
Closing Date.
“Straddle
Period Tax Return”
shall
have the meaning set forth in Section 6.10(a)(ii).
“Tax”
or
“Taxes”
shall
mean (a) all taxes, charges, fees, duties, levies or other assessments
(including income, gross receipts, net proceeds, ad valorem, turnover, real
and
personal property (tangible and intangible), sales, use, franchise, excise,
goods and services, value added, stamp, user, transfer, fuel, excess profits,
occupational, interest equalization, windfall profits, severance, payroll,
unemployment and Social Security taxes) which are imposed by any Governmental
Authority, and such term shall include any interest, penalties or additions
to
tax attributable thereto (or to the nonpayment thereof), whether disputed
or
not, and (b) any liability for the payment of any amounts of the type described
in clause (a) of this definition as a result of being a member of an affiliated,
consolidated, combined or unitary group for any period, as a result of any
tax
sharing, tax indemnity or tax allocation agreement, arrangement or
understanding, or as a result of being liable for another Person’s taxes as a
transferee or successor, by contract or otherwise.
“Tax
Return”
shall
mean any report, declaration, statement, return or other information required
to
be supplied to a Governmental Authority in connection with any Taxes, including
any schedule or attachment thereto and any amendment thereof.
“Tax
Statute of Limitations Date”
shall
mean the expiration of the applicable statute of limitations with respect
to any
Tax, including any extensions thereof (or if such date is not a Business
Day,
the next Business Day).
17
“Technology”
shall
mean trade secrets, proprietary information and know-how, including inventions,
discoveries, formulae, practices, processes, procedures, ideas, specifications,
engineering data, interpretations of any data, software, firmware, programs,
source codes, databases, data collections, customer lists, supplier lists,
pricing and cost information, business and marketing plans, manufacturing
and
production processes, in each case that is not the subject of a patent or
patent
application or a registration or application for registration with
any
Governmental Authority.
“Term
Sheet”
shall
have the meaning set forth in Section 5.5(a).
“Third
Party Claim”
shall
have the meaning set forth in Section 12.6.
“Title
and Authorization Warranty”
shall
mean a representation or warranty in Section 4.1,
4.2,
4.6,
4.8(b),
4.13(c)(iv),
4.13(c)(vi),
5.1
or
5.2.
“Title
Commitments”
shall
have the meaning set forth in Section
7.16.
“Title
IV Plan”
shall
have the meaning set forth in Section 4.17(d).
“Trademark
Assignment”
shall
mean a trademark assignment by the Sellers in favor of the Purchaser
substantially
in the form set forth in Exhibit
J.
“Transfer
Taxes”
shall
have the meaning set forth in Section 6.10(d).
“Transferred
Employee”
shall
have the meaning set forth in Section 11.1.
“Transferred
Intellectual Property”
shall
have the meaning set forth in Section 2.1(f).
“Transferred
IT Assets”
shall
have the meaning set forth in Section 2.1(g).
“Transferred
IT Contracts”
shall
have the meaning set forth in Section 2.2(a).
“Transferred
Owned Real Property”
shall
mean the Geismar Facility and the Monochem Facility.
“Transferred
Patents”
shall
have the meaning set forth in Section 2.1(f)(iii).
“Transferred
Technology”
shall
have the meaning set forth in Section 2.1(f)(ii).
“Transferred
Trademarks”
shall
have the meaning set forth in Section 2.1(f)(i).
“Transition
Services Agreement”
shall
mean a transition services agreement in
a form
to be agreed to between Chemtura and the Purchaser in accordance with
Section
6.25.
“UK
Employees”
shall
have the meaning set forth in Section
11.7(a).
“Unknown
Pre-Closing Environmental Liabilities”
shall
mean all Environmental Liabilities, Environmental Claims or Losses based
on,
arising out of, or related to any acts, events, conditions or circumstances,
or
occurrences associated with, or arising or occurring in connection with or
related to the operations of the Sellers at the Geismar Facility or the Monochem
Facility or the operations of the Chinese Joint Venture, in each case before
the
Closing Date, including any claims based on alleged exposure of any individual
or individuals to asbestos or other Hazardous Substances but shall not include
the Known Pre-Closing Environmental Liabilities.
18
“Unresolved
Adjustments”
shall
have the meaning set forth in Section 3.2(c)(iv).
“Unresolved
Comments”
shall
have the meaning set forth in Section
6.29(a)(iii).
“Warranty
Costs”
shall
have the meaning set forth in Section 6.19.
“Warranty
Obligations”
shall
have the meaning set forth in Section 6.19.
“Wastewater
Tank”
shall
have the meaning set forth in Section 6.15.
“Wastewater
Tank Decommissioning”
shall
have the meaning set forth in Section 6.15.
“Wastewater
Tank Decommissioning Action Costs”
shall
mean any and all costs and expenses incurred in connection with the Wastewater
Tank Decommissioning, including: costs and expenses of environmental
consultants; costs and expenses of treating and disposing of the contents
of the
Wastewater Tank; costs and expenses of conducting sampling and monitoring;
and
reimbursements of costs and expenses incurred by or paid to any Governmental
Authority relating to any of the foregoing as well as the costs of reasonably
removing sludge and bottoms from the wastewater tank referred to as tank
WV-302
located on the Geismar Facility.
“Working
Capital”
shall
mean (a) the sum of (i) the
amount equal to the Accounts Receivable and the Inventory, in each case net
of
related reserves and determined in accordance with the Calculation Principles
(except in the case of the amount of the Inventory of the
Rubber Chemicals Business which shall be determined in accordance with the
methodology set forth in Schedule
1.1(k)),
but in
each case excluding all Excluded Assets, and (ii) the principal amount
of
the
Accounts Receivable Note, minus
(b) the sum of (i) the amount equal to the Current Liabilities and
(ii) the principal amount of the Accounts Payable Note. Notwithstanding the
foregoing, solely for purposes of the preparation of the Estimated Closing
Statement pursuant to Section
3.2(c),
(A) the amount in clause (a)(ii) of this definition of “Working Capital”
shall be the aggregate amount of all Foreign Accounts Receivable (excluding
the
Factored Accounts Receivable and net of related reserves and VAT taxes) as
of
12:00:01 a.m. (eastern time) on the Closing Date and (B) the amount in
clause (b)(ii) of this definition of “Working Capital” shall be calculated using
the aggregate amount of all Accounts Payable as of 12:00:01 a.m. (eastern
time)
on the Closing Date determined in accordance with the Calculation Principles
(except in the case of Accounts Payable of the Rubber Chemicals Business
which
shall be determined in accordance with the methodology set forth in Schedule
1.1(k)).
For
the avoidance of doubt, no assets and liabilities shall be double counted
in the
above calculation of Working Capital.
“Working
Capital Adjustment Amount”
shall
mean the amount (which may be a positive or negative number) equal to (a)
the
Closing Working Capital Amount, minus (b)
the Estimated Working Capital Amount.
19
1.2 Other
Definitional Provisions and Interpretation.
The
headings preceding the text of Articles and Sections included in this Agreement
and the headings to Exhibits and Schedules attached to this Agreement are
for
convenience only and shall not be deemed part of this Agreement or be given
any
effect in interpreting this Agreement. The use of the masculine, feminine
or
neuter gender or the singular or plural form of words herein shall not limit
any
provision of this Agreement. The use of the terms “including” or “include” shall
in all cases herein mean “including, without limitation” or “include, without
limitation,” respectively. Reference to any Person includes such Person’s
successors and assigns to the extent such successors and assigns are permitted
by the terms of any applicable agreement. Reference to a Person in a particular
capacity excludes such Person in any other capacity or individually. Reference
to any agreement (including this Agreement), document or instrument means
such
agreement, document or instrument as amended or modified and in effect from
time
to time in accordance with the terms thereof and, if applicable, the terms
hereof. Underscored references to Articles, Sections, paragraphs, clauses,
Exhibits or Schedules shall refer to those portions of this Agreement. The
use
of the terms “hereunder,” “hereof,” “hereto” and words of similar import shall
refer to this Agreement as a whole and not to any particular Article, Section,
paragraph or clause of, or Exhibit or Schedule to, this Agreement. Terms,
other
than those defined or referenced in Section 1.1,
may be
defined elsewhere in the text of this Agreement and, unless otherwise indicated,
shall have the specified meaning throughout this Agreement.
ARTICLE
2.
PURCHASE
AND SALE OF ASSETS; ASSUMPTION OF ASSUMED OBLIGATIONS
2.1 Purchase
and Sale of Assets.
Upon
the terms and subject to the conditions of this Agreement, at the Closing,
each
Seller shall sell, assign, convey, transfer and deliver to the Purchaser,
and
the Purchaser shall purchase and acquire from such Seller, and take assignment
and delivery from such Seller of, all of such Seller’s right, title and interest
in and to the following assets, properties and rights, as the same shall
exist
on the Closing Date (but excluding the Purchased Contracts and Assigned Permits,
which are specifically addressed in Section 2.2,
and the
Excluded Assets, and excluding the assets, properties and rights of the Chinese
Joint Venture) (the “Purchased
Assets”):
(a) Inventory.
The
Inventory;
(b) Transferred
Owned Real Property.
The
Transferred Owned Real Property;
(c) Geismar
Equipment.
All
equipment, machinery, furniture, spare parts, furnishings, tooling, dies,
vehicles, office equipment and supplies, computer hardware, corporeal movables
and other items of tangible personal property that are owned by a Seller
and
located at the Geismar Facility;
(d) Naugatuck
Equipment.
The
equipment located at the Naugatuck Site and set forth on Schedule 2.1(d)
(the
“Naugatuck
Equipment”);
(e) Information
and Records. Except
as
otherwise provided in Section 2.4(w),
all
customer lists, supplier lists, price lists, sales records, invoices, product
specifications, advertising materials, cost and pricing manuals, training
manuals, engineering data, maintenance schedules, operating and production
records, order lists, copies of Tax and financial records and credit records
of
customers, and other documents (such documents, “Information
and Records”)
related to the Purchased Assets, Purchased Contracts and Assumed Obligations,
including compilations of any of the foregoing, in each case whether in hard
copy or electronic format and supplied in their current formats and that
(i) are owned by a Seller and used primarily in or have arisen primarily
from the conduct of the Business or are necessary for the ongoing operations
of
the Business (which in the case of Information and Records that are necessary
for the ongoing operations of Other Chemtura Businesses will be retained
by the
Sellers and made available to the Purchaser pursuant to Section
6.6(b))
or (ii)
must be delivered to the Purchaser under applicable Law; provided,
that
(A) the Sellers shall be entitled to retain copies of such Information and
Records and (B) where originals of such Information and Records must be retained
by any Seller under applicable Law, the Sellers will provide the Purchaser
with
a copy of the same;
20
(f) Intellectual
Property.
Except
for patents and patent applications which are addressed in Section 2.1(f)(iii),
all
Intellectual Property owned by any Seller and used primarily in the Business
(the “Transferred
Intellectual Property,”
which
for the avoidance of doubt, includes the Intellectual Property licensed by
the
applicable Seller to the Chinese Joint Venture except for the following licensed
marks: TUEX, MONEX, METHAZATE, BUTAZATE and ETHAZATE), and all rights to
xxx for
past, present and future infringement and remedies related thereto. The
Transferred Intellectual Property includes the following:
(i) Trademarks.
All
trade names, domain names, trademarks, service marks, trade dress and logos
owned by any Seller that are used primarily in the conduct of the Business,
together with all translations, adaptations, derivations and combinations
thereof and all goodwill associated therewith, including the registrations
and
applications for registration for the foregoing and the material unregistered
trademarks set forth on Schedule 2.1(f)(i)
(the
“Transferred
Trademarks”)
(it
being understood, for the avoidance of doubt, that the Transferred Trademarks
shall not include the Chemtura Names);
(ii) Technology.
All
Technology owned by any Seller that (A) is described on Schedule 2.1(f)(ii)
or (B)
arose primarily from the conduct of the Business and has been or is
currently used
or
held for use primarily in the Business (the “Transferred
Technology”);
and
(iii) Patents.
All
patents and patent applications owned by the Sellers that are set forth on
Schedule 2.1(f)(iii)
(the
“Transferred
Patents”).
(g) Transferred
IT Assets.
All
information technology assets, hardware, systems, databases, networks, and
infrastructure of any Seller that are used or held for use primarily in the
conduct of the Business, including those set forth on Schedule 2.1(g)
(the
“Transferred
IT Assets”);
(h) Accounts
Receivable.
All
Accounts Receivable other than the Foreign Accounts Receivable;
21
(i) Goodwill.
All of
the customer relationships and related goodwill of the Sellers to the extent
resulting from the conduct of the Business by the Sellers (it being understood,
for the avoidance of doubt, that such goodwill shall not include any goodwill
associated with the Chemtura Names, Other Chemtura Businesses or Excluded
Assets
or any goodwill to the extent associated with continuing customers of Other
Chemtura Businesses);
(j) Monochem.
All of
the assets, properties and rights of Monochem;
(k) Chinese
Joint Venture.
All of
Chemtura’s equity interest in the Chinese Joint Venture; and
(l) Other
Business Assets.
All
assets (real or personal, tangible or intangible), other than those of a
nature
or type described in the foregoing clauses
(a)
through
(k),
owned
by a Seller and used primarily in the EPDM Business or the Rubber Chemicals
Business, but excluding the PPD Equipment.
Notwithstanding
the foregoing, the transfer of the Purchased Assets pursuant to this Agreement
shall not include the assumption of any of the Liabilities of the Sellers
related to the Purchased Assets unless the Purchaser expressly assumes any
such
Liabilities pursuant to Section 2.5.
2.2 Assignment
of Permits and Contracts.
Except
as provided in Sections
2.3
and
2.4,
upon
the terms and subject to the conditions of this Agreement, at the Closing,
each
Seller shall assign and transfer to the Purchaser, and the Purchaser shall
take
assignment of, all of such Seller’s right, title and interest in and to all
Permits related to the Business or the Assets to the extent such Permits
are
transferable by such Seller (including the Permits listed on Schedule 2.2
but
excluding Permits of the Chinese Joint Venture) (collectively, the “Assigned
Permits”),
and
in and to the following Contracts or contractual rights of such Seller
(excluding, in each case, Contracts to which the Chinese Joint Venture is
a
party but no Seller is a party or contractual rights solely of the Chinese
Joint
Venture) (such Contracts and contractual rights, the “Purchased
Contracts”):
(a) Transferred
IT Contracts.
All
Contracts for the provision of software, hardware, systems, networks,
infrastructure, communications, support and information technology that are
used
primarily in the conduct of the Business, including those set forth on
Schedule 2.2(a)
(the
“Transferred
IT Contracts”);
(b) Other
Contracts.
Other
than the Shared Contracts, the other Contracts related to the Business set
forth
on Schedule 2.2(b)
and all
other Contracts relating primarily to the Business (it being understood that,
on
the fifth Business Day prior to the Closing, the Sellers shall provide the
Purchaser with an updated version of Schedule 2.2(b)
reflecting the Contracts relating primarily to the Business that were entered
into by a Seller on or after the date of this Agreement not in violation
of
Section 6.2
of this
Agreement);
(c) Non-Disclosure
Obligations.
Except
to the extent related to the Excluded Assets or Retained Obligations, all
non-disclosure, confidentiality and similar obligations owed to any Seller
to
the extent related to the Business, including confidentiality agreements
related
to the sale of the Business (other than confidentiality agreements related
to
the sale of the Business the assignment or disclosure of which to the Purchaser
would constitute a breach thereof);
22
(d) Claims.
Except
to the extent related to the Excluded Assets or Retained Obligations, all
warranty rights and indemnities against third parties, in each case to the
extent arising from the conduct of the Business by any Seller and not arising
under rights of subrogation under a Seller Plan;
(e) Employee
Non-Compete and Confidentiality Obligations.
All
rights with respect to any obligation of any Business Employee owed to any
Seller to refrain from competing with the Business or to keep information
regarding the Business confidential, in each case to the extent such rights
are
transferable; and
(f) Shared
Contracts.
Subject
to Section 2.3(c),
Sellers’ rights under the Shared Contracts to the extent relating to the conduct
of the Business.
2.3 Certain
Provisions Regarding Assignments.
(a) Anything
in this Agreement to the contrary notwithstanding, neither this Agreement
nor
any of the actions taken hereunder shall constitute an assignment or an
agreement to assign or transfer any Purchased Contract or any claim, right,
benefit or obligation thereunder or resulting therefrom if (i) an assignment
or
transfer thereof, without the Consent of a third party thereto, would constitute
a breach or violation thereof, result in a material loss or diminution thereof
or impose any Liability on any Seller and (ii) such Consent is not obtained
at
or prior to the Closing, in which case the provisions of Section 2.3(b)
will
apply.
(b) If
the
parties are not successful in obtaining a required third party Consent with
respect to any Purchased Contract as contemplated by Section 2.3(a)
at or
prior to the Closing, then until such time as such Consent is obtained (i)
the
Purchaser shall be entitled to the benefits of any such Contract accruing
after
the Closing to the extent (and only to the extent) that the applicable Seller
may provide such benefits (y) without violating the terms of such Contract
and
(z) without incurring any material expense (unless the Purchaser has committed
to promptly reimburse the applicable Seller therefor) or otherwise taking
any
material actions or measures (such as hiring additional employees) and (ii)
the
Purchaser shall perform at its sole expense the obligations of the applicable
Seller to be performed after the Closing under such Contract to the extent
(and
only to the extent) the applicable Seller is providing benefits under such
Contract to the Purchaser in accordance with clause
(i)
of this
Section 2.3(b).
The
terms of this Section 2.3(b)
shall
not apply with respect to Shared Contracts, it being understood that the
treatment of Shared Contracts is addressed in Section 2.3(c).
(c) Prior
to
the Closing and consistent with applicable Law, each Seller and the Purchaser
shall use their commercially reasonable efforts to work together (and, if
necessary and desirable, to work with the third parties party to the Shared
Contracts) in an effort to (i) divide, modify and/or replicate (in whole
or in
part) the respective rights and obligations under and in respect of the Shared
Contracts and (ii) if possible, novate the respective rights and obligations
under and in respect of the Shared Contracts, such that, effective as of
the
Closing, (A) the Purchaser is the beneficiary of the rights and is responsible
for the obligations related to that portion of the Shared Contract included
in
the Purchased Contracts (the “Business
Portion”)
(so
that, after the Closing, the applicable Seller shall have no rights or
obligations with respect to the Business Portion of the Shared Contract)
and (B)
the applicable Seller is the beneficiary of the rights and is responsible
for
the obligations related to the Shared Contract other than the Business Portion
(the “Non-Business
Portion”)
(so
that, after the Closing, the Purchaser shall have no rights or obligations
with
respect to the Non-Business Portion of the Shared Contract). If the parties
are
not able to enter into an arrangement to formally divide, modify and/or
replicate one or more Shared Contracts prior to the Closing as contemplated
by
the previous sentence, then (1) the Purchaser shall be entitled to the benefits
of the Business Portion of any such Shared Contract accruing after the Closing
to the extent (and only to the extent) that the applicable Seller may provide
such benefits (y) without violating the terms of such Shared Contract and
(z)
without incurring any material expense (unless the Purchaser has committed
to
promptly reimburse the applicable Seller therefor) or otherwise taking any
material actions or measures (such as hiring additional employees) and (2)
the
Purchaser shall perform at its sole expense the obligations of the applicable
Seller to be performed after the Closing under the Business Portion of such
Shared Contract to the extent (and only to the extent) the applicable Seller
is
providing benefits under such Shared Contract to the Purchaser in accordance
with clause
(1)
of this
Section 2.3(c).
23
2.4 Excluded
Assets.
Notwithstanding the provisions of Sections
2.1
and
2.2,
no
Seller shall sell, assign, convey, transfer or deliver to the Purchaser,
and the
Purchaser shall not purchase, acquire or take assignment or delivery of,
any
assets, properties or rights other than the Assets (collectively, the
“Excluded
Assets”).
Without limiting the foregoing, the Excluded Assets shall include:
(a) Cash.
All
cash, certificates of deposit, bank deposits, negotiable instruments, marketable
securities and other cash equivalents, together with all accrued but unpaid
interest thereon;
(b) Real
Property.
All
Real Property owned by the Sellers and their Affiliates, other than the
Transferred Owned Real Property;
(c) Chemtura
Names.
The
Chemtura Names and all goodwill associated therewith;
(d) Tax
Refunds; Tax Returns.
All
claims for and rights to receive refunds, rebates or similar payments of
Taxes
to the extent such Taxes were paid by or on behalf of any Seller or any of
its
Affiliates (other than the Chinese Joint Venture), all Tax Returns and all
notes, worksheets, files or documents relating thereto;
24
(e) Corporate
Records.
All
minute books and corporate records of the Sellers or any of their Affiliates
(other than the Chinese Joint Venture), whether in hard copy or electronic
format;
(f) Employee
Records.
All
personnel, employee compensation, medical and benefits and labor relations
records relating to employees or past employees of the Sellers or any of
their
Affiliates (other than the Chinese Joint Venture), whether in hard copy or
electronic format; provided,
however,
that
the Sellers shall deliver to the Purchaser copies of such records for employees
who are Transferred Employees (i) as to the Transferred Employees that are
Non-U.S. Employees, upon a showing of employee consent to such delivery,
and
(ii) as to the other Transferred Employees, unless such employee’s consent is
required by Law therefor, in which event such records shall not be made
available to the Purchaser without such employee’s consent to such
delivery;
(g) Other
Records.
All
books and records not transferred pursuant to Section 2.1(e),
including financial records, in each case whether in hard copy or electronic
format;
(h) Sale
Documents.
Except
as otherwise provided in Section 2.1(e),
books
and records prepared or received in connection with the proposed sale of
the
Business, including offers received from prospective purchasers, and the
right,
title and interest of the Sellers under this Agreement or any Related
Agreement;
(i) Disposed
Assets.
All
assets sold or otherwise disposed of, and rights expiring or terminated,
in the
ordinary course of business and not in violation of this Agreement during
the
period from the date of this Agreement until the Closing Date;
(j) Insurance.
Any
insurance policies or insurance coverage relating to the Assets or the Business
and any prepaid insurance assets or insurance receivables related
thereto;
(k) Intercompany
Agreements.
Except
as set forth on Schedule
2.4(k),
all
Contracts solely between the Sellers or any Seller (on the one hand) and
any one
or more Affiliates (other than the Chinese Joint Venture) of any Seller (on
the
other hand);
(l) Group
Contracts.
All
Group Contracts other than the respective Business Portions of the Shared
Contracts;
(m) Intellectual
Property.
All
right, title and interest in or to any Intellectual Property or other intangible
property or rights owned by, or leased or licensed to, any Seller or any
of
their Affiliates (other than the Chinese Joint Venture) (such excluded
Intellectual Property to include the Naugalube Intellectual Property and
the
Intellectual Property related to B-Nine® and Maleic Hydrazides), other than the
Transferred Intellectual Property, the Transferred IT Contracts, any Purchased
Contracts relating to Intellectual Property and the rights of the Purchaser
under the License Agreements;
(n) Non-Disclosure
Obligations.
All
non-disclosure, confidentiality and similar rights or obligations to the
extent
related to any Other Chemtura Business;
25
(o) Employee
Non-Compete Obligations.
All
rights with respect to any obligation of any Business Employee to refrain
from
competing with any Other Chemtura Business;
(p) Retained
IT Assets.
The
information technology assets, systems, networks and Contracts of any Seller
that are not used or held for use primarily in connection with the Business,
including as set forth on Schedule 2.4(p)
(the
“Retained
IT Assets”);
(q) Rubicon.
All
right, title and interest of Chemtura and its Affiliates in and to Rubicon
LLC;
(r) PPD
Equipment.
All
equipment and machinery that are owned by a Seller and used or held for use
in
the Rubber Chemicals Business exclusively in the production of PPD Products
at
the Non-U.S. Facilities (the “PPD
Equipment”);
(s) Claims.
All
warranty rights and indemnities against third parties, in each case to the
extent related to the Excluded Assets or Retained Obligations;
(t) Benefit
Plans.
All of
the Seller Plans;
(u) Retained
PPD Assets.
The
Retained PPD Inventory and the Retained PPD Receivables;
(v) Foreign
Accounts Receivable.
The
Foreign Accounts Receivable;
(w) Privileged
Documents.
Any
Privileged Documents to the extent relating to any Excluded Asset or any
Retained Liability; and
(x) Other
Assets.
All
other assets (real or personal, tangible or intangible) and Contracts of
the
Sellers not included in the Purchased Assets, Assigned Permits or Purchased
Contracts.
None
of
the Excluded Assets shall be included in the term “Assets,” “Purchased Assets,”
“Purchased Contracts,” “Assigned Permits” or any other term defined in
Section 2.1
or
2.2.
2.5 Assumed
Obligations.
Upon
the terms and subject to the conditions of this Agreement, at the Closing,
the
Purchaser shall assume and agree to pay, perform and discharge only the
following Liabilities of the Sellers and their Affiliates (the “Assumed
Obligations”):
(a) Current
Liabilities.
All
Current Liabilities;
(b) Purchased
Contracts.
All
Liabilities under the Purchased Contracts, including the Business Portion
of the
Shared Contracts, relating to the period after the Closing (subject to
Section 2.5(c));
(c) Product
Claims.
Except
for Environmental Liabilities, which are excluded from this Section 2.5(c),
26
(i) subject
to clause
(iii)
below,
all Liabilities arising with respect to the products produced by or on behalf
of
the Purchaser after the Closing or the services of the Business delivered
or
provided by or on behalf of the Purchaser after the Closing, in each case
whether arising under warranty, contract, equity, tort, strict liability,
product liability, statute or otherwise;
(ii) all
Liabilities with respect to any product of the Business produced by or on
behalf
of any Seller prior to the Closing and sold or delivered by or on behalf
of the
Purchaser after the Closing (whether arising under warranty, contract, equity,
tort, strict liability, product liability, statute or otherwise), to the
extent
that:
(A) the
Purchaser has changed in any substantive manner the terms or scope of any
product warranty associated with such product from the applicable warranty
offered by the Business as of the date hereof or, at the Purchaser’s election,
as of the Closing;
(B) a
product
produced by or on behalf of the Purchaser after the Closing and having the
same
product specifications as the applicable product produced by or on behalf
of a
Seller prior to the Closing was sold or delivered by or on behalf of the
Purchaser or the Business on a date earlier than the date of sale or delivery
of
such product produced by or on behalf of a Seller; or
(C) such
product was sold or delivered by or on behalf of the Purchaser or the Business
following the first anniversary of the Closing Date, provided
that
such period of sale or delivery shall be extended to 18 months following
the
Closing Date with respect to those products of the Business on which Chemtura
and the Purchaser shall agree on or prior to the Closing (together with any
other products of the Business on which the parties are unable to agree,
so long
as the Purchaser has a good faith basis for so extending such
period);
(iii) all
Liabilities with respect to any Flexzone® 7-L products produced by or on behalf
of the Seller prior to the Closing that are commingled with Flexzone® 7-L
products produced by or on behalf of the Purchaser after the Closing (whether
arising under warranty, contract, equity, tort, strict liability, product
liability, statute or otherwise), to the extent that:
(A) such
Flexzone® 7-L products produced by the Purchaser after the Closing are
determined, following an investigation by the parties, not to have conformed
to
the Purchaser’s product specifications; or
(B) such
Flexzone® 7-L product was sold or delivered by or on behalf of the Purchaser
following the 20th day after the Closing Date;
(d) Employee
Obligations.
All
Liabilities to or with respect to the Transferred Employees occurring after
the
Closing and relating solely to the period after the Closing, except as provided
in Article
11
or any
Employee Exhibit;
27
(e) Permits.
All
Liabilities under the Assigned Permits relating to the period after the
Closing;
(f) Intellectual
Property Liabilities.
All
Liabilities in connection with the Transferred Intellectual Property relating
to
the period after the Closing;
(g) Taxes.
All
Taxes, fees and other amounts for which the Purchaser is responsible pursuant
to
Sections 6.10(b),
(c)
and
(d);
(h) Permitted
Liens.
All
Liabilities under the Permitted Liens relating to the period after the
Closing;
(i) Environmental
Liabilities.
All
Environmental Liabilities that are the responsibility of the Purchaser under
Section
12.9;
and
(j) Financial
Assurance.
All
Liabilities with respect to financial assurance and any closure obligations
under the Resource Conservation and Recovery Act (“RCRA”),
or
any state equivalent, related to (i) the Drum Storage Area, tank PR 202,
tank
PV-42 (to the extent operated after the Closing) and the Trilene Gel Tank,
(ii)
any other unit operated by the Purchaser and regulated under the RCRA Permit,
a
subsequent Permit issued pursuant to RCRA or interim status, including, for
the
avoidance of doubt, all financial assurance obligations associated with the
closure of any such units pursuant to RCRA and (iii) any requirement to provide
financial assurance for corrective obligations under the RCRA Permit, a
subsequent Permit issued pursuant to RCRA or interim status to the extent
of the
Purchaser’s obligations under Section
12.9
(“Purchaser’s
Financial Assurance Obligations”).
2.6 Retained
Obligations.
Notwithstanding any other provision of this Agreement, except for the Assumed
Obligations, the Purchaser shall not assume or otherwise be liable or
responsible for any other Liabilities of the Sellers or their Affiliates
(collectively, the “Retained
Obligations”).
Without limiting the generality of the foregoing, the Retained Obligations
shall
include the following:
(a) Taxes.
All
Liabilities for Taxes imposed on or relating to the Business or the Assets
for
any taxable period or portion thereof ending prior to the Closing Date, and
any
Liabilities for Taxes imposed on or relating to any Seller for any period,
except that Taxes governed by Sections 6.10(b),
(c)
and
(d)
shall be
allocated between the Sellers and the Purchaser as set forth
therein;
(b) Accounts
Payable.
All
accounts and notes payable of the Business as of the Closing and all related
accruals (“Accounts
Payable”);
(c) Pre-Closing
Operation of the Business.
Other
than the Liabilities assumed by the Purchaser pursuant to Section 2.5,
all
Liabilities to the extent arising out of the ownership or operation of the
Business or the Assets by any Seller or any of its Affiliates prior to the
Closing;
28
(d) Employee
Liabilities.
All
Liabilities of any Seller or any of its Affiliates to or with respect to
its
employees, including the Business Employees, except as provided in Article
11
or any
Employee Exhibit.
(e) Antitrust
Proceedings.
All
Liabilities to the extent arising out of or related to private and governmental
antitrust or competition law Proceedings arising out of the sale of any product
or service related to the Business prior to the Closing, including those
set
forth on Schedule 4.12;
(f) Sellers’
Offsite Environmental Liabilities.
All
Sellers’ Offsite Environmental Liabilities;
(g) Environmental
Liabilities.
All
Environmental Liabilities that are the responsibility of the Sellers under
Section
12.9;
(h) Financial
Assurance.
All
Liabilities with
respect to financial assurance and any closure obligations under RCRA, or
any
state equivalent, related to: (i) the Toluene Tar Tank, the incinerator,
the
Geismar Landfill, the UBOB tank, tank PV-42 (to the extent it is not operated
after the Closing), including, for the avoidance of doubt, all financial
assurance obligations associated with the closure of any such units pursuant
to
the RCRA, and (ii) any requirement to provide financial assurance for the
corrective obligations under the RCRA Permit, a subsequent Permit issued
pursuant to RCRA or interim status to the extent of the Seller’s obligations
under Section
12.9
(“Sellers’
Financial Assurance Obligations”);
(i) Product
Claims.
Except
to the extent specifically assumed by the Purchaser pursuant to Section 2.5(c)(ii)
or
(iii),
all
Liabilities arising with respect to the services of the Business delivered
or
provided prior to the Closing and the products produced or sold by any Seller
prior to the Closing and whether arising under warranty, contract, equity,
tort,
strict liability, product liability, statute or otherwise, but excluding
Environmental Liabilities (the “Retained
Product Claims”);
(j) Excluded
Assets.
All
Liabilities of any Seller or any of its Affiliates to the extent arising
out of
or related to the Excluded Assets; and
(k) Monochem.
Other
than Liabilities assumed by the Purchaser pursuant to Section 2.5,
all
Liabilities of Monochem.
2.7 Prorations.
Each
Seller and the Purchaser agree that all of the items listed below relating
to
the Business or the Assets will be prorated as of the Closing Date on a per
diem
basis, with the applicable Seller liable to the extent such items relate
to any
time period up to and including the Closing Date and the Purchaser liable
to the
extent such items relate to periods after the Closing Date (it being understood
that the proration of Taxes is addressed in Section 6.10):
(a) rents,
license fees, registration fees and other items payable periodically under
any
Purchased Contract (any such amounts that are paid on a monthly basis shall
be
prorated solely for the month of Closing);
29
(b) the
amount of any registration fees or similar charges which in any case are
payable
periodically by the applicable Seller with respect to any of the Assigned
Permits (any such amounts that are paid on a monthly basis shall be prorated
solely for the month of Closing); and
(c) the
amount of sewer rents and charges for water, electricity and other utilities
and
fuel (any such amounts that are paid on a monthly basis shall be prorated
solely
for the month of Closing).
For
the
avoidance of doubt, no amount included within the Working Capital Adjustment
Amount shall be included in the prorations pursuant to this Section 2.7.
At
least five Business Days prior to the Closing, the Sellers shall deliver
to the
Purchaser a written statement setting forth the actual (to the extent available
at the Closing Date) or estimated amounts in respect of the items described
above that are to be prorated as well as the Taxes that are to be prorated
pursuant to Section 6.10
(the
aggregate of such actual amounts, after being agreed to by the Purchaser,
being
the “Closing
Proration Amount”).
On
the Closing Date, Chemtura or the Purchaser, as applicable, shall pay to
the
other party the Closing Proration Amount. To the extent that the actual amounts
for any items to be prorated are not available at the Closing Date, the
proration of such amounts shall be calculated and appropriate adjustments
shall
be paid by Chemtura or the Purchaser, as applicable, as soon as reasonably
practicable after the actual amounts become available. The Sellers and the
Purchaser shall furnish each other with such documents and other records
as may
be reasonably requested in order to confirm all adjustments and proration
calculations made pursuant to this Section 2.7.
ARTICLE
3.
PURCHASE
PRICE; ADJUSTMENT; ALLOCATION
3.1 Payment
of Purchase Price.
(a) In
addition to the assumption by the Purchaser of the Assumed Obligations, the
Purchaser shall pay to Chemtura, in consideration for the Assets, a purchase
price equal to the sum of the following (the “Purchase
Price”):
(i) an
amount
equal to (A) $162,500,000, less
(B) the
amount of the Factored Accounts Receivable (net of related reserves and VAT
taxes) as reflected on the Estimated Closing Statement and discounted
proportionately at an annual rate of seven percent (7%) from the scheduled
payment dates set forth in the Accounts Receivable Note, in immediately
available funds, subject to adjustment pursuant to Section 3.2
(the
“Initial
Purchase Price”);
and
(ii) a
promissory note in original principal amount equal to the aggregate amount
of
all Accounts Payable as reflected on the Estimated Closing Statement issued
by
the Purchaser to Chemtura substantially in the form set forth in Exhibit
K
(the
“Accounts
Payable Note”),
such
promissory note shall (1) have a term of 90 days, (2) be payable
bi-weekly in equal installments, (3) be unsecured and (4) bear no
interest.
30
(b) All
payments made hereunder shall be made in accordance with Section 13.4
and to
such account or accounts as the receiving party shall designate in writing
to
the paying party not less than two Business Days prior to the applicable
payment
date.
3.2 Purchase
Price Adjustments.
(a) Capital
Expenditures Adjustments.
(i) If
(A)
the aggregate amount of actual capital expenditures made or accrued by the
Business during the period beginning on January 1, 2007 and ending on the
Closing Date is (B) less than the budgeted capital expenditures for the same
period as set forth on the 2007 Budget, then (C) the Initial Purchase Price
will
be reduced by the amount of such deficiency.
(ii) If
(A)
the capital expenditures made or accrued by the Business during the year
ended
December 31, 2006, determined in accordance with the Calculation Principles
and
as set forth on the Reconciliation, is (B) less than $7.5 million, then (C)
the
Initial Purchase Price will be reduced by the amount of such
deficiency.
(b) Additional
Adjustments.
The
Initial Purchase Price shall be subject to further possible adjustments pursuant
to Schedule
3.2(b).
(c) Working
Capital Adjustment.
(i) No
more
than five and no less than three Business Days prior to the Closing Date,
the
Sellers will prepare and deliver to the Purchaser a calculation and statement
of
the estimated Working Capital as of 12:00:01 a.m. (eastern time) on the Closing
Date (the “Estimated
Closing Statement”).
The
Sellers will prepare the Estimated Closing Statement in good faith, in
accordance with the Calculation Principles, and using the same level of prudence
as used in the preparation of the Audited Special Purpose Financial Statements,
subject to the Purchaser’s good faith review and reasonable satisfaction. If the
Working Capital as set forth on the Estimated Closing Statement (the
“Estimated
Working Capital Amount”)
is
less than the Net Working Capital Threshold Amount, then the Initial Purchase
Price will be reduced by the amount of such deficiency. If the Estimated
Working
Capital Amount is greater than the Net Working Capital Threshold Amount,
then
the Initial Purchase Price will be increased by the amount of such
excess.
(ii) As
soon
as practicable but in no event later than 90 days following the Closing Date,
the Purchaser will prepare and deliver to Chemtura a calculation and statement
of the Working Capital as of 12:00:01 a.m. (eastern time) on the Closing
Date
and the proposed Working Capital Adjustment Amount (the “Closing
Statement”).
In
connection with the preparation of the initial draft of the Closing Statement
and only if a shutdown of the Geismar Facility would not be reasonably required
in connection therewith, Chemtura and the Purchaser (and, if desired, their
respective outside experts) shall cooperate in taking a physical inventory
of
the Inventory located at the Geismar Facility on a date not earlier than
three
days prior to the Closing Date, and shall obtain confirmation letters from
each
location where Inventory was held as of the Closing Date. The Purchaser will
prepare the Closing Statement in good faith in accordance with the Calculation
Principles, applied in a consistent manner with, and using the same level
of
prudence as used in the preparation of, the Audited Special Purpose Financial
Statements.
31
(iii) Chemtura
shall review the initial draft of the Closing Statement during the 30-day
period
commencing on the date that Chemtura receives the initial draft of the Closing
Statement. At or prior to the end of such 30 day period, Chemtura may deliver
a
notice to the Purchaser either:
(A) confirming
that no adjustments are proposed by Chemtura to the initial draft of the
Closing
Statement (a “Notice
of Acceptance”);
or
(B) to
the
effect that Chemtura disagrees with the initial draft of the Closing Statement
(a “Notice
of Disagreement”),
specifying the nature of such disagreement and the adjustments that Chemtura
seeks to the initial draft of the Closing Statement (collectively, the
“Proposed
Adjustments”).
(iv) To
the
extent that there are any Proposed Adjustments, the Purchaser will, no later
than 30 days after its receipt of the Proposed Adjustments, notify Chemtura
which of the Proposed Adjustments it accepts (if any) and which of the Proposed
Adjustments it rejects (if any). Chemtura and the Purchaser shall seek in
good
faith to resolve any differences that remain in relation to the Proposed
Adjustments and to reach agreement in writing on any Proposed Adjustments
not
accepted by the Purchaser. If any of the Proposed Adjustments are not so
resolved (the “Unresolved
Adjustments”)
within
30 days after Chemtura’s receipt of the Purchaser’s notice relating to the
Proposed Adjustments, the Unresolved Adjustments shall be submitted at the
request of either Chemtura or the Purchaser to a mutually acceptable
internationally recognized independent public accounting firm as shall be
agreed
upon by the parties hereto in writing (the “Accounting
Firm”)
for
arbitration. The scope of the review by the Accounting Firm shall be limited
to
(i) a determination of whether the Unresolved Adjustments are appropriate
taking into account the standards of preparation of the initial draft of
the
Closing Statement as set forth in Section 3.2(c)(ii)
and (ii)
based on its determinations of the matters described in clause
(i)
and
taking into account the Proposed Adjustments previously accepted by the
Purchaser, if any, the delivery of a final Closing Statement including the
final
Working Capital Adjustment Amount. The Accounting Firm is not to make or
be
asked to make any determination other than as set forth in the previous
sentence. Chemtura and the Purchaser shall use commercially reasonable efforts
to cause the Accounting Firm to render its written decision resolving the
matters submitted to it as promptly as practicable after such submission
of the
Unresolved Adjustments. Judgment may be entered upon the determination of
the
Accounting Firm in any court having jurisdiction over the party against which
such determination is to be enforced. The Purchaser shall bear and pay a
portion
of the fees and disbursements of the Accounting Firm determined by multiplying
(1) the fees and disbursements of the Accounting Firm by (2) a quotient equal
to
(X) the total amount of the Proposed Adjustments that are ultimately applied
to
the Closing Statement, whether because such adjustment was accepted by the
Purchaser or applied by the Accounting Firm in determining the final Closing
Statement, divided by (Y) the total amount of the originally Proposed
Adjustments. Chemtura shall bear the amount of the fees and disbursements
of the
Accounting Firm that are not the responsibility of the Purchaser as set forth
in
the preceding sentence. The fees and disbursements (if any) of the Purchaser’s
outside experts incurred in connection with the preparation and certification
of
the initial draft of the Closing Statement and their review of any Proposed
Adjustments or Unresolved Adjustments shall be borne by the Purchaser, and
the
fees and disbursements (if any) of Chemtura’s outside experts incurred in
connection with their review of the draft Closing Statement and any Proposed
Adjustments or Unresolved Adjustments shall be borne by Chemtura.
32
(v) The
Closing Statement shall become final and binding on all parties, and shall
have
the effect of an arbitral award, upon the earliest of (i) the date that a
Notice
of Acceptance is delivered to the Purchaser pursuant to Section 3.2(c)(iii)(A)
(in
which case the final Working Capital Adjustment Amount shall be as set forth
in
the Closing Statement delivered pursuant to Section 3.2(c)(ii)),
(ii)
the date that is one day after the 30 day review period specified in
Section 3.2(c)(iii)
has
ended if no Notice of Disagreement has been delivered to the Purchaser pursuant
to Section 3.2(c)(iii)(B)
during
such 30 day period (in which case the final Working Capital Adjustment Amount
shall be as set forth in the Closing Statement delivered pursuant to
Section 3.2(c)(ii)),
(iii)
the date of an agreement in writing by the Sellers and the Purchaser that
the
Closing Statement, together with any modifications thereto agreed by the
Sellers
and the Purchaser, are final and binding (in which case the final Working
Capital Adjustment Amount shall be as so agreed upon by the parties) and
(iv)
the date on which the Accounting Firm resolves in writing any disputed matters
(in which case the final Working Capital Adjustment Amount shall be as
determined by the Accounting Firm pursuant to Section 3.2(c)(iv)).
(vi) Each
of
the Sellers, on the one hand, and the Purchaser, on the other hand, shall
reasonably cooperate with each other and provide the other (and such other’s
independent auditors) with reasonable access to any books, records, working
papers and employees as the other may reasonably request, in each case in
connection with the preparation and review of the Closing Statement pursuant
to
this Section 3.2(c).
(vii) The
Purchase Price shall be increased by the absolute value of the final Working
Capital Adjustment Amount if the final Working Capital Adjustment Amount
is
positive and decreased by the absolute value of the final Working Capital
Adjustment Amount if the final Working Capital Adjustment Amount is negative.
If
the final Working Capital Adjustment Amount is a negative number, the Sellers
shall, within two Business Days after the Closing Statement becomes final
and
binding on the parties (as provided in Section 3.2(c)(v)),
make
payment by wire transfer in immediately available funds to one or more accounts
designated by the Purchaser of the absolute value of such amount together
with a
sum equivalent to interest thereon at a rate equal to the LIBOR Rate, accrued
from the Closing Date to and including the date of payment and calculated
on the
basis of the actual number of days elapsed divided by 360. If the final Working
Capital Adjustment Amount is a positive number, the Purchaser shall, within
two
Business Days after the Closing Statement becomes final and binding on the
parties (as provided in Section 3.2(c)(v)),
make
payment by wire transfer in immediately available funds to an account designated
by Chemtura of the absolute value of such amount together with a sum equivalent
to interest thereon at a rate equal to the LIBOR Rate, accrued from the Closing
Date to and including the date of payment and calculated on the basis of
the
actual number of days elapsed divided by 360. “LIBOR
Rate”
shall
mean the closing rate of interest announced publicly by the British Bankers
Association as its three month LIBOR rate for U.S. dollars on the Business
Day
preceding the date of determination, which for purposes of this Section 3.2(c)(vii)
shall be
the day the Closing Statement becomes final and binding on the parties (as
provided in Section 3.2(c)(v)).
The
parties agree that any amounts paid pursuant to this Section 3.2(c)(vii)
shall be
allocated in a manner that is consistent with the allocation of the Purchase
Price pursuant to Section 3.4.
33
3.3 Withholding.
The
Purchaser shall be entitled to deduct and withhold from the consideration
otherwise payable pursuant to this Agreement to any Seller such amounts as
the
Purchaser is required to deduct and withhold under the Code, or any provision
of
state, local or foreign tax law, with respect to the making of such payment.
To
the extent that amounts are so withheld by the Purchaser, such withheld amounts
shall be treated for all purposes of this Agreement as having been paid to
the
Seller in respect of whom such deduction and withholding was made by the
Purchaser.
3.4 Allocation
of Consideration for Assets.
Following the Closing, Chemtura and the Purchaser shall use commercially
reasonable efforts to agree on an allocation of the Purchase Price, together
with all Assumed Obligations assumed by Purchaser, among the Assets, the
Accounts Receivable Note and the Purchaser’s Option in accordance with section
1060 of the Code. If Chemtura and the Purchaser are not able to agree on
such
allocation prior to the date that is four months after the Closing Date,
Chemtura and the Purchaser shall jointly retain an appraiser to value the
Assets
and prepare such allocation, with the cost of, and any expenses associated
with,
such appraisal to be borne fifty percent by the Sellers and fifty percent
by the
Purchaser. Following the final determination of the allocation, each of the
Purchaser and the Sellers shall (and shall cause their respective Affiliates
to)
file all necessary Tax Returns and other forms (including Internal Revenue
Service Form 8594) to report the transactions contemplated herein for U.S.
federal, state, local and non-United States income Tax purposes in accordance
with such allocation, and shall not take any position inconsistent with such
allocation (or any adjustment to such allocation). Any adjustment to the
Purchase Price for the Assets shall be allocated as provided in Treasury
Regulation section 1.1060-1 and, in the event of such adjustment, the Purchaser
and the Sellers agree to revise and amend such allocation and Form 8594 within
30 days of such adjustment.
Notwithstanding the foregoing, prior to the Closing, Chemtura and the Purchaser
shall agree upon the portion of the Purchase Price to be allocated to the
Transferred Owned Real Property (which allocation shall be comprised only
of a
portion of the Initial Purchase Price) so that the applicable Act of Cash
Sale
may reflect such amount and recite that it was received all in cash and for
purposes of determining the fair market value of the Transferred Owned Real
Property pursuant to Section
6.17,
and
such allocation shall not be modified after the Closing without the prior
written agreement of Chemtura and the Purchaser.
34
ARTICLE
4.
REPRESENTATIONS
AND WARRANTIES OF SELLERS
The
Sellers, jointly and severally, represent and warrant to the Purchaser as
follows:
4.1 Due
Organization.
Each
Seller and the Chinese Joint Venture (a) is a corporation, limited
liability company, limited liability corporation or private company with
limited
liability (as the case may be) duly organized, validly existing and, solely
with
respect to those of such entities that are domiciled in jurisdictions that
recognize the concept of good standing, in good standing under the laws of
the
jurisdiction of its formation, (b) has the requisite power and authority to
own, operate and lease its properties and to conduct its business as presently
conducted, and (c) other than such jurisdictions in which the failure to be
qualified or in good standing would not reasonably be expected to have a
Business Material Adverse Effect, is duly qualified to do business and is
in
good standing as a foreign entity in each jurisdiction that recognizes the
concept of good standing and in which its ownership of Assets and its historic
conduct of the Business makes such qualification necessary.
4.2 Due
Authorization.
Each
Seller has full corporate, limited liability company, limited liability
corporation or private company with limited liability (as the case may be)
power
and authority to execute, deliver and perform this Agreement and its Related
Agreements and to consummate the transactions contemplated hereby and thereby.
The execution, delivery and performance by each Seller of this Agreement
and its
Related Agreements and the consummation by such Seller of the transactions
contemplated hereby and thereby have been duly authorized by all necessary
action, including the approval (if required) of the board of directors (or
similar governing body) of such Seller. Each Seller has duly and validly
executed and delivered this Agreement and, at or prior to the Closing, such
Seller will have duly and validly executed and delivered each of its Related
Agreements. Assuming the due authorization, execution and delivery of this
Agreement and its Related Agreements by the Purchaser, this Agreement
constitutes, and each Related Agreement will upon the Closing constitute,
the
legal, valid and binding obligation of each Seller party thereto, enforceable
against it in accordance with its respective terms, subject to the
Enforceability Limitations.
4.3 Consents
and Approvals; Authority Relative to this Agreement.
(a) Except
(i) for the Governmental Required Consents and (ii) as set forth on
Schedule 4.3(a),
no
material Consent of or with any Governmental Authority is necessary in
connection with (1) the execution, delivery or performance of this Agreement
by
any Seller or of any of the applicable Related Agreements by any Seller or
(2)
the consummation of any of the transactions contemplated hereby or thereby
by
any Seller.
(b) Other
than in the cases of clauses (2) and (3) below, any such items that would
not
reasonably be expected to have a Business Material Adverse Effect, and except
(i) as set forth on Schedule 4.3(a)
or
Schedule
4.3(b),
and
subject to obtaining the Governmental Required Consents, the execution, delivery
and performance of this Agreement and of the applicable Related Agreements
by
each Seller, and the consummation of the transactions contemplated hereby
and
thereby by each Seller, do not and will not: (1) violate any material Law
applicable to or binding on any Seller or any Assets; (2) constitute a
breach or default of, or permit cancellation of, or result in the creation
of
any Lien upon any of the Assets, or result in or constitute a circumstance
which, with or without notice or lapse of time or both, would constitute
any of
the foregoing under, any Purchased Contract or any Contract to which any
Seller
or the Chinese Joint Venture is a party or any Contract by which any Seller
or
the Chinese Joint Venture, or any of such Seller’s or the Chinese Joint
Venture’s respective assets is bound or by which any of the Assets are bound;
(3) permit the acceleration of the maturity of any indebtedness of any
Seller or the Chinese Joint Venture or any of their respective Affiliates
or
indebtedness secured by any of their respective assets or any indebtedness
secured by the Assets; or (4) violate or conflict with any provision of the
certificate of
incorporation or by-laws (or similar organizational documents) of any Seller
or
the Chinese Joint Venture. This Section
4.3(b)
does not
apply to the Transferred
Intellectual Property or
the
Purchased Contracts relating to the Transferred Intellectual
Property.
35
4.4 Financial
Statements.
Schedule 4.4
sets
forth the unaudited special purpose financial statements of the Business
(a) as of September 30, 2006 and for the nine-month period then ended (the
“2006
Pre-Signing Financial Statements”),
and
(b) as of December 31, 2005 and for the year then ended, in each case
together with any footnotes and schedules thereto (referred to collectively
as
the “Pre-Signing
Financial Statements”).
The
Pre-Signing Financial Statements (i) were prepared from the books and
records of the Sellers and the Business, (ii) fairly present, in all
material respects, the net assets and revenues and expenses of the Business
as
of the dates and for the periods indicated therein, and (iii) were prepared
in accordance with the Calculation Principles, except (A) as set forth in
the footnotes thereto, and (B) that the interim Pre-Signing Financial
Statements described in clause (a) above are subject to normal year-end
adjustments.
4.5 No
Adverse Effects or Changes.
Except
(a) with respect to the Excluded Assets and the Retained Obligations,
(b) as otherwise contemplated by this Agreement or (c) as set forth on
Schedule 4.5,
since
September 30, 2006, (i) the Business has not suffered any event which has
had or would reasonably be expected to have a Business Material Adverse Effect
and (ii) the Business has been conducted in the ordinary course and in
substantially the same manner as previously conducted.
4.6 Title
to Assets.
(a) Except
as
set forth on Schedule
4.6,
one or
more of the Sellers has good and marketable title to, a valid and subsisting
leasehold interest in or a valid right to use, each of the Assets free and
clear
of any Lien other than Permitted Liens, including on and as of the Closing
Date,
any Lien associated with the Receivables Securitization Agreements. Subject
to
obtaining and making all applicable Consents, each Seller (as applicable)
has
the right to sell, convey, transfer, assign and deliver the Assets owned,
leased
or used by it, as applicable, to the Purchaser and at the Closing such Seller
shall convey to the Purchaser good and marketable title to, valid and subsisting
leasehold interests in, or a valid right to use (as applicable), such Assets,
free and clear of any Lien (other than Permitted Liens). This Section 4.6(a)
does not
apply to (a) title to Transferred Owned Real Property, which is addressed
solely in Section 4.8
and
(b) title to Transferred Intellectual Property, which is addressed solely
in Section 4.13.
36
(b) The
Chinese Joint Venture has good and marketable title to, a valid leasehold
interest in or a valid right to use, each of its assets, properties and rights
free and clear of any Lien other than Permitted Liens (the “Chinese
Joint Venture Assets”),
including on and as of the Closing Date, any Lien associated with the
Receivables Securitization Agreements.
4.7 Assets.
(a) Except
as
set forth on Schedule 4.7(a),
the
Assets and the Chinese Joint Venture Assets, together with the Group Contracts
identified on Schedule 4.7(a),
the PPD
Equipment, the Retained PPD Inventory and the rights and services to be provided
by the Sellers to the Purchaser under the Chemtura Master Supply Agreement,
the
Transition Services Agreement, the License Agreements and the Ground Lease,
constitute all the properties, assets and rights necessary to operate the
Business in all material respects as it is currently conducted by the Sellers
and the Chinese Joint Venture.
(b) Except
as
set forth on Schedule 4.7(b),
(i) the Assets located at the Geismar Facility and the Monochem Facility
that are tangible personal property, buildings, structures, improvements
or
fixtures are, taken as a whole and having due regard for their age and length
of
use, in good repair and good operating condition, ordinary wear and tear
excepted, and are suitable for use in the Business as currently conducted
and
(ii) the Chinese Joint Venture Assets that are tangible personal property,
buildings, structures, improvements or fixtures are, taken as a whole and
having
due regard for their age and length of use, in good repair and good operating
condition, ordinary wear and tear excepted, and are suitable for use in the
Business as currently conducted. The parties acknowledge and agree that the
Sellers’ financial obligations with respect to the repair, upgrade or
replacement of any Assets disclosed on Part A of Schedule
4.7(b) as
exceptions to this Section
4.7(b)
shall be
as set forth on Part B of Schedule
4.7(b).
4.8 Real
Property.
(a) Except
as
set forth on Schedule 4.8(a),
the
Transferred Owned Real Property is the only Real Property currently used
by the
Sellers or the Chinese Joint Venture in connection with the
Business.
(b) (i) Subject
to the Permitted Liens, the applicable Seller has the right to sell, convey,
transfer, assign and deliver the Transferred Owned Real Property to the
Purchaser, and (ii) at the Closing such Seller shall sell, convey,
transfer, assign and deliver to the Purchaser good and marketable fee simple
title to and absolute ownership of each Transferred Owned Real Property with
limited warranties of title and limited warranties of condition consistent
with
the warranties set forth herein, free and clear of all Liens and Encumbrances
(other than the Permitted Liens and all easements, servitudes, rights of
way or
other agreements of record with respect thereto). For the avoidance of doubt,
no
Transferred Owned Real Property is or shall be, immediately following the
consummation of the Closing, subject to any lease or option, other than the
Option Agreement dated as of May 5, 1998 between Uniroyal Chemical Company,
Inc.
and Air Liquide America Corporation.
37
(c) Schedule 4.8(c)
sets
forth (i) a true and complete list of all Real Property leased by any Seller
or
the Chinese Joint Venture and used in connection with the Business or
constituting a part of the Assets (the “Leased
Real Property”)
and
(ii) a true and correct list of all leases pursuant to which any Seller or
the
Chinese Joint Venture leases the Leased Real Property. The Sellers have made
available to the Purchaser a true and complete copy of each such
lease.
To the
Sellers’ Knowledge, no material default exists under any of the leases
associated with the Leased Real Property. The applicable Seller or the Chinese
Joint Venture enjoys quiet and peaceful possession of all such Leased Real
Property in which it is the tenant.
4.9 Equipment;
Leased Personal Property.
(a) Schedule 4.9(a)
includes
a true and complete list by location of all of the equipment, machinery and
other corporeal movables owned by a Seller and used or held for use primarily
in
the conduct of the EPDM Business and having an individual net book value
in
excess of $50,000.
(b) Schedule 4.9(b)
sets
forth a true and complete list by location of all the equipment, machinery
and
other corporeal movables owned by a Seller or the Chinese Joint Venture and
used
or held for use primarily in the conduct of the Rubber Chemicals Business
and
having an individual net book value in excess of $50,000, other than the
PPD
Equipment.
(c) Schedule 4.9(c)
sets
forth a true and complete list by location of the PPD Equipment
having
an individual net book value in excess of $50,000.
(d) Schedule 4.9(d)
sets
forth a list of each lease to which any Seller or the Chinese Joint Venture
is a
party with respect to tangible personal property used or held for use primarily
in the conduct of the Business having aggregate remaining minimum lease payments
in excess of $50,000. The Sellers have made available to the Purchaser true
and
complete copies of all the tangible personal property leases set forth on
Schedule 4.9(d)
(excluding tangible personal property leases that the Sellers have provided
in
redacted form or determined to withhold, in each case due to confidentiality
restrictions, and which tangible personal property leases are described on
Schedule 4.9(d)).
(e) The
spare
parts constituting a part of the Assets and those constituting a part of
the
Chinese Joint Venture Assets are in quantities reasonably sufficient to conduct
the continuing operations of the Business (taking into account the matters
described in Schedule
4.9(e)).
4.10 Customers
and Suppliers.
Except
as set forth on Schedule 4.10(a),
to the
Sellers’ Knowledge, there is no material dispute that relates to the Business
between any Seller or the Chinese Joint Venture (on the one hand) and any
Material Customer of or Material Supplier to such Seller or the Chinese Joint
Venture (on the other hand). To the Sellers’ Knowledge, since January 1, 2006,
and except for the expiration of any Purchased Contract in accordance with
its
terms, no Material Customer or Material Supplier has notified any of the
Sellers
or the Chinese Joint Venture in writing that it has cancelled or otherwise
terminated its relationship with the Business or materially and adversely
reduced the level of business done with the Business, either as a result
of the
transactions contemplated hereby or otherwise. “Material
Customer”
shall
mean the 20 largest customers of each of the EPDM Business and the Rubber
Chemicals Business and the four largest customers of the Monochem Business
(in
each case as measured by Dollar amounts of purchases of products or services
from each such business) during fiscal year 2006 to date, as set forth on
Schedule
4.10(b).
“Material
Supplier”
shall
mean the 10 largest suppliers of each of the EPDM Business and the Rubber
Chemicals Business at the Geismar Facility and the seven largest suppliers
of
the Monochem Business (in each case as measured by Dollar amounts paid by
each
such business for products or services) during fiscal year 2006 to date,
as set
forth on Schedule
4.10(b).
38
4.11 Accounts
Receivable.
(a) Except
as
set forth on Schedule
4.11(a),
all
Accounts Receivable that are reflected on the most recent Pre-Signing Financial
Statements, to the extent uncollected as of the date hereof, and the Accounts
Receivable reflected, since the date of the most recent Pre-Signing Financial
Statements, on the books of the Business are valid and existing and reflect
amounts due arising from bona fide sales actually made or bona fide services
actually performed by one or more of the Sellers or the Chinese Joint Venture
in
the ordinary course of business. Schedule 4.11(a)
contains
a correct and complete aging schedule as of September 30, 2006 of all Accounts
Receivable. The reserve for doubtful accounts on the most recent Pre-Signing
Financial Statements has been calculated generally in accordance with the
Calculation Principles. To the Sellers’ Knowledge, as of the date of this
Agreement, there are no facts or circumstances that could reasonably be expected
to result in any material increase in the uncollectibility or delinquency
in
payment of the Accounts Receivable as a class in excess of the reserves therefor
set forth on the most recent Pre-Signing Financial Statements.
(b) Schedule 4.11(b)
identifies all unreturned security deposits and other deposits made by, or
held
by, any Person with respect to the Business for the benefit of any Seller
or the
Chinese Joint Venture that are reflected on the most recent Pre-Signing
Financial Statements and any made since September 30, 2006, in each case
as of
the date of this Agreement. Neither any Seller nor the Chinese Joint Venture
is
holding any security deposits with respect to the Business for the benefit
of
any other Person.
4.12 Proceedings.
Except
as set forth on Schedule 4.12,
as of
the date of this Agreement, there are no Proceedings pending or, to the Sellers’
Knowledge, threatened against any Seller or the Chinese Joint Venture that
relate to the Business or any Asset before any arbitrator, court or other
Governmental Authority, in each case which, if adversely determined, would
(a)
be reasonably likely to have a Business Material Adverse Effect, (b) be
reasonably likely to result in damages over $100,000 or
(c)
enjoin or otherwise prohibit or restrict any of the transactions contemplated
by
this Agreement. Except as set forth on Schedule 4.12,
the
operation of the Business by each Seller and the Chinese Joint Venture is
not
subject to any order, judgment, decree, injunction, stipulation or consent
order
of or with any arbitrator, court or other Governmental Authority, other than
any
such orders having application to industry-wide matters. Neither any Seller
(in
relation to its conduct of the Business) nor the Chinese Joint Venture has
entered into any agreement to settle or compromise any Proceeding pending
or
threatened against it which has involved any obligation other than the payment
of money and for which it has any continuing obligation.
39
4.13 Intellectual
Property.
(a) Schedule 4.13(a)
sets
forth a true and complete list of all patents and patent applications and
all
registrations and applications for registrations for all Intellectual Property
owned by any Seller or the Chinese Joint Venture and that are used in or
necessary for the conduct of the Business (the “Registered
Intellectual Property”).
(b) Schedule 4.13(b)(i)
sets
forth a true and complete list of all licenses and other Contracts, other
than
“off the shelf” commercially available software programs purchased or licensed
for less than $100,000 in the aggregate, pursuant to which any Seller or
the
Chinese Joint Venture licenses from a third party Intellectual Property used
in
the conduct of the Business (the “Material
Licenses”).
Schedule 4.13(b)(ii)
sets
forth a true and complete list of all licenses and other Contracts pursuant
to
which any Seller or the Chinese Joint Venture licenses to a third party any
Transferred Intellectual Property (the “Outbound
Licenses”).
The
Sellers have made available to the Purchaser a true and complete copy of
each of
the Material Licenses and the Outbound Licenses (excluding Material Licenses
and
Outbound Licenses that the Sellers have provided in redacted form or determined
to withhold, in each case due to confidentiality restrictions or because
such
licenses relate to Other Chemtura Businesses). To the Sellers’ Knowledge, the
Material Licenses and Outbound Licenses are in full force and effect, and
neither any Seller nor the Chinese Joint Venture has taken any action or
failed
to take any action that would constitute a breach of any Material Licenses
or
Outbound Licenses. Except as set forth on Schedule 4.13(b)(iii),
neither
any Seller nor the Chinese Joint Venture pays any royalty or other compensation
to any Person for the right to use any Intellectual Property that is material
to
the Business.
(c) Except
as
set forth on Schedule 4.13(c):
(i) to
the
Sellers’ Knowledge, the use of the Transferred Intellectual Property as
currently used by the Sellers in the conduct of the Business or by any party
who
is a licensee under such Transferred Intellectual Property from any Seller,
and
the conduct of the Business as conducted by the Sellers for the 12 months
preceding the date hereof, does not infringe, dilute, misappropriate or
otherwise violate the Intellectual Property rights of any other
Person;
(ii) to
the
Sellers’ Knowledge, the use of the Chinese Joint Venture Intellectual Property
by the Chinese Joint Venture in the conduct of its business or by any party
who
is a licensee under such Chinese Joint Venture Intellectual Property from
the
Chinese Joint Venture, and the conduct of the Business as conducted by the
Chinese Joint Venture for the 12 months preceding the date hereof, does not
infringe, dilute, misappropriate or otherwise violate the Intellectual Property
rights of any other Person;
40
(iii) no
Proceedings have been instituted and are pending and neither any Seller nor
the
Chinese Joint Venture has received a written notice or threat from any Person
which: (A) assert an ownership interest in any Transferred Intellectual Property
or any Chinese Joint Venture Intellectual Property, (B) allege that the conduct
of the Business by any Seller or the Chinese Joint Venture violates any rights
relating to Intellectual Property of any Person or (C) challenge the validity
or
enforceability of the Transferred Intellectual Property; and to Seller’s
Knowledge, no basis for any of the foregoing exists;
(iv) the
Sellers are the sole and exclusive owners of the Transferred Intellectual
Property, free and clear of any Lien other than Permitted Liens;
(v) Subject
to obtaining and making all applicable Consents, each Seller (as applicable)
has
the right to sell, convey, transfer, assign and deliver the Transferred
Intellectual Property and the Purchased Contracts related to the Transferred
Intellectual Property to the Purchaser and at the Closing such Seller shall
convey to the Purchaser good and marketable title to such Transferred
Intellectual Property and the Purchased Contracts related to the Transferred
Intellectual Property, free and clear of any Lien (other than Permitted
Liens).
(vi) the
Chinese Joint Venture is the sole and exclusive owner of the Chinese Joint
Venture Intellectual Property, free and clear of any Lien other than Permitted
Liens;
(vii) the
Sellers and the Chinese Joint Venture have taken reasonable measures to protect
the confidentiality of the trade secrets and confidential information with
respect to the Transferred Intellectual Property and the Chinese Joint Venture
Intellectual Property, respectively; and
(viii) neither
any Seller nor the Chinese Joint Venture has filed any Proceeding or sent
any
written notice of a violation, infringement, misuse or misappropriation by
any
Person of Sellers’ rights to, or in connection with, the Transferred
Intellectual Property or the Chinese Joint Venture Intellectual Property
and, to
the Sellers’ Knowledge, none of the Transferred Intellectual Property or the
Chinese Joint Venture Intellectual Property is being infringed, diluted,
misappropriated or otherwise violated by any Person. With respect to the
Registered Intellectual Property, all fees, including registration, maintenance
and renewal fees, that were due and payable to any applicable United States
or
other Governmental Authority have been paid.
(d) The
Transferred Intellectual Property together with the Intellectual Property
licensed to the Purchaser under the License Agreements constitute all of
the
Intellectual Property necessary for the conduct of the Business as it is
presently conducted.
(e) Other
than the Governmental Required Consents, no Consent of or with any Governmental
Authority is necessary in connection with (i) the assignment of the Transferred
Intellectual Property and the Purchased Contracts relating to Intellectual
Property contemplated in this Agreement or (ii) the execution, delivery or
performance of the License Agreements by any Seller.
41
(f) The
assignment of the Transferred Intellectual Property and the Purchased Contracts
relating to Intellectual Property as contemplated in this Agreement, and
the
execution, delivery or performance of the License Agreements by any Seller,
and
the execution and performance by Chemtura under the Chemtura Master Supply
Agreement, including the granting of the licenses contained therein by the
Purchaser to Chemtura, do not and will not: (i) violate any Law applicable
to or
binding on any Seller or any of the Transferred Intellectual Property, any
Purchased Contracts relating to Intellectual Property or the License Agreements;
(ii) constitute a breach or default of, or permit cancellation of, or result
in
the creation of any Lien upon any of the Transferred Intellectual Property,
any
Purchased Contracts relating to Intellectual Property or the License Agreements,
or result in or constitute a circumstance which, with or without notice or
lapse
of time or both, would constitute any of the foregoing under any Purchased
Contract relating to Intellectual Property or by which any of the Transferred
Intellectual Property is bound; (iii) permit the acceleration of the maturity
of
any indebtedness of any Seller or any of its respective Affiliates secured
by
the Transferred Intellectual Property or any Purchased Contracts relating
to
Intellectual Property or (iv) violate or conflict with any provision of the
certificate of incorporation or by-laws (or similar organizational documents)
of
any Seller.
(g) The
Sellers and the Chinese Joint Venture are in compliance in all material respects
with all Laws applicable to or binding on them or any of the Transferred
Intellectual Property, the Chinese Joint Venture Intellectual Property and
the
Purchased Contracts relating to Intellectual Property.
(h) Except
as
set forth on Schedule 4.13(h),
the
Inventory is not subject to any agreement pursuant to which any Seller (or
following the Closing, the Purchaser) is authorized to use any Intellectual
Property in connection with the manufacture, marketing, sale or other
distribution or disposition of any Inventory or other agreement that limits,
conditions or restricts any Seller’s or the Chinese Joint Venture’s (or upon and
following the consummation of the Closing, the Purchaser’s) right to sell or
otherwise dispose of such Inventory. No Inventory is the subject of any
Intellectual Property Claim.
4.14 Contracts.
(a) Schedule 4.14(a)
is a
true and complete list, as of the date of this Agreement, of all the Contracts
of the following types to which (1) any Seller or the Chinese Joint Venture
is a
party (but only if such Contract primarily relates to the Business) or (2)
any
of the Assets is subject:
(i) any
collective bargaining agreement;
(ii) any
Contract with any Business Employee (other than a Non-U.S. Employee) related
to
the terms and conditions of employment, other than a Contract on the Sellers’
standard
form Contract
with Business Employees related to the terms and conditions of employment
previously made available to the Purchaser and other than Benefit Plans and
Benefit Programs;
42
(iii) the
Sellers’ standard form Contract under which any Business Employee (other than a
Non-U.S. Employee) has any obligation to any Seller to refrain from competing
with the Business or to keep information regarding the Business
confidential;
(iv) any
Contract pursuant to which any Seller has made or will make loans or advances,
or has incurred, or is obligated to incur (whether on an absolute or contingent
basis), indebtedness for borrowed money or has become a guarantor or surety
or
pledged its credit for or otherwise become responsible for or is otherwise
liable for or obligated with respect to any undertaking of another Person
(except for endorsements for collection or deposit of negotiable instruments
in
transactions in the ordinary course of business);
(v) any
Contract with (A) any Affiliate of any Seller (including any Contract between
one or more Sellers and the Chinese Joint Venture but excluding any contract
with or relating to any Seller Plan) or (B) any officer or director of any
Seller or the Chinese Joint Venture (other than employment agreements or
similar
arrangements relating to their employment);
(vi) any
Contract (including a purchase order) with any customer or supplier with
whom
the Sellers or the Chinese Joint Venture have entered into Contracts (including
purchase orders) which, in the aggregate, have or are expected to have a
commitment of more than $250,000 on an annual basis;
(vii) any
Contract involving a partnership, joint venture or other cooperative undertaking
or other arrangement involving a sharing of profits or expenses;
(viii) any
Contract involving any non-competition or similar restrictions binding on
any
owner of the Business, including with respect to the geographical area of
operations or scope or type of business of any owner of the
Business;
(ix) any
Contract for any capital expenditures or leasehold improvements involving
the
payment of more than $100,000;
(x) any
Contract that, if terminated prior to its expiration in accordance with its
terms, would reasonably be expected to have a Business Material Adverse
Effect;
(xi) any
Contract that imposes or evidences any Lien for borrowed money or material
Lien
(other than a Permitted Lien) on any of the Assets.
(xii) any
consignment Contract;
43
(xiii) any
lease
with respect to Real Property or any of the other material Assets;
(xiv) any
Contract to sell, lease or dispose of any Asset, in each case other than
in the
ordinary course of business or in connection with the matters described in
Schedule
4.9(e);
(xv) any
Contract for storage, processing, terminalling, delivery, shipment or
transportation of Assets, including any Contract with any warehouseman,
processor or bailee;
(xvi) any
sales
agency, sales representative, distributorship or marketing
Contract;
(xvii) any
other
Contract providing for future payments by any Seller or the Chinese Joint
Venture in excess of $100,000 on an annual basis that cannot be terminated
upon
90 days’ notice by such Seller or the Chinese Joint Venture (and, following the
Closing, by the Purchaser) without penalty or premium; and
(xviii) any
other
Contract entered into outside the ordinary course of business the absence
of
which would have a Business Material Adverse Effect.
(b) The
Sellers have made available to the Purchaser a true and complete copy of
each
Contract or form of Contract that is listed on Schedule 4.14(a)
(the
“Material
Contracts”)
(excluding Contracts that the Sellers have provided in redacted form or
determined to withhold, in each case due to confidentiality restrictions
or
because such Contracts relate to Other Chemtura Businesses). Except as set
forth
on Schedule 4.14(b),
to the
Sellers’ Knowledge, the Material Contracts are in full force and
effect.
4.15 Permits.
Except
as
set forth on Schedule
4.15,
each
Seller and the Chinese Joint Venture possesses or has applied for all material
Permits required by applicable Law for such Seller or the Chinese Joint Venture
to conduct the Business as currently conducted. Schedule 4.15
is a
true and complete list of all Permits (other than Environmental Permits)
held by
the Sellers and the Chinese Joint Venture in connection with the Business
and
material to the operation of the Business. Except as set forth on Schedule
4.15,
each
Seller and the Chinese Joint Venture is and has been for the 12 months preceding
the date hereof in material compliance with all Permits held in connection
with
the Business applicable to or binding on it or any of its Assets, and since
January 1, 2006, neither any Seller nor the Chinese Joint Venture has received
any written notice from a Governmental Authority that (i) alleges that any
Seller or the Chinese Joint Venture is not in material compliance with any
Permit or (ii) alleges that any Seller or the Chinese Joint Venture does
not possess any Permit required by applicable Law for such Seller to conduct
the
Business as currently conducted. This Section 4.15
does not
relate to the Environmental Permits, which are addressed in Section 4.21.
4.16 Inventory.
(a) The
Inventory reflected in the most recent Pre-Signing Financial
Statements is
fairly
valued in accordance with the Calculation Principles. The Inventory, taken
as a
whole, consists of a quality and is in quantities sufficient and reasonable
for
the operation of the Business as contemplated by the 2007 Budget. Finished
goods
constituting Inventory are saleable in the ordinary course of business except
for obsolete items and items of below-standard quality all of which will
at the
Closing have been written down to net realizable value on the Estimated Closing
Statement. The inventory obsolescence policies of the Sellers and the Chinese
Joint Venture with respect to the Business are appropriate for the nature
of the
products sold. Schedule
4.16(a)
sets
forth a list of the places where Inventories were located as of the date
indicated therein, which is in each case within five Business Days of the
date
hereof.
44
(b) Except
pursuant to the Purchased Contracts set forth on Schedule
4.16(b),
no
Inventory is consigned to any Person.
(c) Except
pursuant to the Purchased Contracts set forth on Schedule
4.16(c),
no
inventory is held by any Seller on consignment from any Person or subject
to any
sale-or-return, sale-on-approval or repurchase agreement with any
supplier.
(d) Except
as
set forth on Schedule
4.16(d),
all of
the Inventory is in the physical possession of a Seller, located in a warehouse
or a similar facility or is in transit to or from a customer or supplier
of a
Seller or from a warehouse or such similar facility.
4.17 Benefit
Plans.
(a) Schedule 4.17(a)
lists
each of the following which is sponsored, maintained or contributed to by
the
Sellers or any of their ERISA Affiliates for the benefit of Business Employees
(other than any Non-U.S. Employees), other than any Foreign Benefit Plans
(except as provided in Section
4.17(c)
below).
To the extent applicable, all matters relating to Non-U.S. Employees and
Foreign
Benefit Plans are set forth in Exhibit
China,
Section
11.7
and
Schedule
11.7,
or,
with respect to other Non-U.S. Employees and Foreign Benefit Plans, will
be
addressed in accordance with Section
11.3.
(i) each
“employee benefit plan,” as such term is defined in section 3(3) of ERISA
(“Benefit
Plan”);
and
(ii) each
written personnel policy pertaining to compensation and benefits matters,
written stock option plan, stock purchase plan, stock appreciation rights
arrangement, phantom stock plan, collective bargaining agreement, bonus plan
or
arrangement, incentive award plan or arrangement, vacation policy, severance
pay
plan, policy or agreement, deferred compensation agreement or arrangement,
executive compensation or supplemental income arrangement, severance agreement,
change in control agreement and each other employee benefit plan, agreement,
arrangement, program, practice or understanding which is not described in
Section 4.17(a)(i)
(each a
“Benefit
Program”).
(b) True,
correct and complete copies of each of the Benefit Plans and Benefit Programs,
including all amendments thereto, have been made available to the
Purchaser.
45
(c) Each
Benefit Plan, Benefit Program and Foreign Benefit Plan complies with and
has
been administered in form and in operation in all material respects in
accordance with its terms and will all applicable requirements of
Law.
(d) As
to any
employee benefit plan subject to Title IV of ERISA sponsored, maintained
or
contributed to by the Sellers or any of their ERISA Affiliates (collectively,
the “ERISA
Group”)
for
the benefit of the employees of the ERISA Group or former employees of the
ERISA
Group or which has been so sponsored, maintained or contributed to within
six
years prior to the Closing Date for the benefit of such individuals (a
“Title
IV Plan”),
there
has been no event or condition which presents the risk of plan termination,
no
accumulated funding deficiency, whether or not waived, within the meaning
of
section 302 of ERISA or section 412 of the Code has been incurred, no reportable
event within the meaning of section 4043 of ERISA (for which the disclosure
requirements of Regulation section 4043.1 et seq.,
promulgated by the Pension Benefit Guaranty Corporation (“PBGC”)
have
not been waived) has occurred, no notice of intent to terminate the Title
IV
Plan has been given under section 4041 of ERISA, no proceeding has been
instituted under section 4042 of ERISA to terminate the Title IV Plan, and
no
liability to the PBGC has been incurred (other than premiums incurred in
the
normal operation of such employee benefit plans);
(e) With
respect to any Title IV Plan, no withdrawal liability, within the meaning
of
section 4201 of ERISA, has been incurred, which withdrawal liability has
not
been satisfied, and all contributions (including installments) to such plan
required by section 302 of ERISA and section 412 of the Code have been timely
made.
4.18 Employment
and Labor Matters.
(a) The
Sellers have made available to the Purchaser a true and complete list of
Business Employees as of February
2, 2007 containing, for each Business Employee, the job title or position,
date
of commencement of employment or engagement, current compensation including
bonus eligibility percentage and sick and paid-time-off and vacation leave
that
is accrued or credited but unused or unpaid as of the date on which the list
described herein was completed. There is, and since January 1, 2005 there
has
been, no labor strike, material labor dispute, material labor slow-down,
material work stoppage pending or, to the Sellers’ Knowledge, threatened,
against any Seller or the Chinese Joint Venture and relating to the Business.
None of the Business Employees are covered by any collective bargaining
agreement and, to the Sellers’ Knowledge, no representation petition has been
filed by any such employee and is pending before the National Labor Relations
Board (or any similar non-U.S. Governmental Authority) and, since January
1,
2005, to the Sellers’ Knowledge no union organizing campaign with respect to the
Business has been in progress or has been threatened.
(b) With
regard to the Business Employees, the Sellers and the Chinese Joint Venture
are
in compliance in all material respects with all applicable Laws relating
to
employment and employment practices, terms and conditions of employment,
and
wages and hours, and, to the Sellers’ Knowledge, are not engaged in any unfair
labor practice or unlawful employment practice. In addition, there are no
material pending or unremedied grievances, or material pending or unremedied
unfair labor practice charges, or material pending or unremedied arbitration
proceedings against any Seller or the Chinese Joint Venture with respect
to the
Business.
46
(c) With
regard to the Business Employees, the Sellers and the Chinese Joint Venture
have
not received written notice of any material charge or complaint since January
1,
2005 before the Equal Employment Opportunity Commission or the Department
of
Labor or any state, local or foreign agency of similar jurisdiction relating
to
the Sellers, and the Sellers and the Chinese Joint Venture have not, to the
Sellers’ Knowledge, received any notice of any such material threatened charge
or complaint against any Seller before the Equal Employment Opportunity
Commission or the Department of Labor or any state, local or foreign agency
of
similar jurisdiction relating to the Sellers or the Chinese Joint
Venture.
(d) With
regard to the Business Employees, the Sellers and the Chinese Joint Venture
have
not received written notice of any material complaint or claim since January
1,
2006 from any Business Employee that has been or will be filed in any federal,
state, city or foreign court of competent jurisdiction arising out of the
employment with or separation of employment from the Sellers or the Chinese
Joint Venture.
4.19 Taxes.
Except
as otherwise set forth on Schedule 4.19:
(a) All
material Tax Returns with respect to the Assets or the Business that are
required to be filed before the Closing Date have been or will be timely
filed,
the information provided on such Tax Returns is or will be complete and accurate
in all material respects, and all Taxes shown to be due on such Tax Returns
have
been or will be paid in full, to the extent that a failure to file such Tax
Returns or pay such Taxes, or an inaccuracy in such Tax Returns, as applicable,
would reasonably be expected to result in Purchaser being liable for such
Taxes
or would reasonably be expected to give rise to a Lien on the Assets. There
are
no currently pending or, to the Sellers’ Knowledge, threatened, audits,
administrative or judicial proceedings, or any deficiency or refund litigation,
with respect to Taxes (i) that could affect the Assets or the Business after
the
Closing or (ii) of the Chinese Joint Venture.
(b) All
material federal, state and foreign Tax Returns required to be filed by or
for
the Chinese Joint Venture in respect of Taxes have been timely filed. Each
such
Tax Return is true and correct in all material respects. All Taxes owed by
or
with respect to the Chinese Joint Venture have been timely paid.
(c) The
Chinese Joint Venture has not granted (and is not subject to) any waiver
or
extension that is currently in effect of the period of limitations for the
assessment or payment of any Taxes or the filing of any Tax Return. No material
unpaid Tax assessment, deficiency or adjustment has been assessed or asserted
in
writing against or with respect to the Chinese Joint Venture by any Governmental
Authority.
(d) The
Chinese Joint Venture will not be required to include any amount in income
for
any Taxable period ending on or after the Closing Date as a result of a change
in accounting method for any Taxable period ending before the Closing
Date or
pursuant to any agreement with any Governmental Authority with respect to
any
such Taxable period. The Chinese Joint Venture will not be required to include
in any period ending after the Closing Date any income that accrued in a
prior
period but was not recognized in any prior period as a result of the installment
method of accounting, the completed contract method of accounting, the long-term
contract method of accounting, the cash method of accounting, or
otherwise.
47
(e) The
Chinese Joint Venture is not a party to or does not have any obligation under
any tax-sharing, tax indemnity or tax allocation agreement or similar
arrangement, nor does the Chinese Joint Venture have any Liability or potential
Liability to another party under any such agreement or arrangement.
(f) The
Chinese Joint Venture has not executed or entered into with the IRS, or any
other Governmental Authority, a closing agreement pursuant to section 7121
of
the Code or any similar provision of state, local, foreign or other Tax law,
that will require any increase in taxable income, or any reduction in Tax
deductions or Tax credits for, the Chinese Joint Venture for any Taxable
period
ending after the Closing Date.
(g) No
Seller
that is a foreign person within the meaning of section 1445(f)(3) of the
Code is
transferring a “United States real property interest” within the meaning of
section 897(c) of the Code.
(h) The
Chinese Joint Venture is, and at all times since its inception has been,
classified as an association taxable as a corporation for U.S. federal income
tax purposes under Treasury Regulation section 301.7701-3(b).
4.20 No
Defaults or Violations.
(a) Except
as
set forth on Schedule 4.20,
since
January 1, 2006, none of the Sellers nor the Chinese Joint Venture has breached
the provisions of, and none of the Sellers nor the Chinese Joint Venture
is in
default under the terms of or has triggered any termination rights under
or
obligation to deliver any collateral, credit support, advance payment or
adequate assurances under, any Material Contract and, to the Sellers’ Knowledge,
no other party to any such Material Contract has, since January 1, 2006,
breached any material provision thereof or is in material default thereunder
or
has triggered any termination rights thereunder or obligation to deliver
any
collateral, credit support, advance payment or adequate assurances
thereunder.
(b) Excluding
(i) matters relating to Taxes, which are addressed in Section 4.19,
(ii)
environmental matters, which are addressed in Section 4.21,
(iii) Intellectual Property matters, which are addressed in Section 4.13,
(iv) matters relating to Permits, which are addressed in Section 4.15,
and
(v) employee benefits and employee matters, which are addressed in
Sections 4.17
and
4.18
or the
Employee Exhibits, the Sellers (in relation to the Business) and the Chinese
Joint Venture are in compliance in all material respects with all Laws
applicable to or binding on them or any of the Assets or the Chinese Joint
Venture Assets and, since January 1, 2006, neither any Seller (in relation
to
the Business) nor the Chinese Joint Venture has received any written notice
from
a Governmental Authority that alleges that any Seller or the Chinese Joint
Venture is not in compliance in all material respects with any Law applicable
to
the conduct of the Business.
48
4.21 Environmental
Matters. Except
as
set forth on Schedule
4.21:
(a) The
Sellers (in relation to the Geismar Facility, the Monochem Facility and the
Business) and the Chinese Joint Venture are in compliance with all applicable
Environmental Laws.
(b) Schedule
4.21(b)
is a
true and complete list of all Environmental Permits held by the Sellers and
the
Chinese Joint Venture in connection with the operation of the Business. The
Sellers and the Chinese Joint Venture are in possession of all Environmental
Permits required for their operation of the Business and are in compliance
with
all of the requirements and limitations included in such Environmental
Permits.
(c) Each
Seller and the Chinese Joint Venture has timely filed applications for the
renewal of such Environmental Permits as may be necessary. There are no facts,
circumstances or conditions that could reasonably be expected to lead to
the
revocation or denial of applications for the renewal of such Environmental
Permits on terms less favorable than what are currently in effect. There
are no
pending challenges to any Environmental Permit.
(d) None
of
the Sellers or their respective Affiliates (in relation to the Geismar Facility,
the Monochem Facility and the Business) or the Chinese Joint Venture or its
Affiliates have, within five years prior to the Closing Date and other than
has
already been provided to the Purchaser, received any notice from any
Governmental Authority claiming or asserting that (i) the operation of the
Business at any location or using any of the tangible Assets by any Seller
or
the Chinese Joint Venture, or any of their respective Affiliates, is in
violation of, or otherwise subject to any liability under any Environmental
Law
or Environmental Permit, or (ii) any Seller or any of its respective Affiliates
(in relation to the Business) or the Chinese Joint Venture or any of its
respective Affiliates is responsible (or potentially responsible) for the
cleanup of any Hazardous Substances at any location.
(e) No
orders, judgments or injunctions under any Environmental Law remain in force
and
effect and apply to the operations of, or impose any on-going liabilities
or
obligations on any Seller or the Chinese Joint Venture.
(f) To
the
Sellers’ Knowledge, no facts, events or conditions relating to the Business and
tangible Assets exist that would be reasonably likely to prevent continued
compliance with Environmental Laws.
(g) Neither
any Seller (in relation to the operation of the Business and tangible Assets)
nor the Chinese Joint Venture is the subject of any pending or threatened
Proceeding in any forum, judicial or administrative, involving a demand for
damages, injunctive relief, penalties or other potential liability with respect
to any Environmental Violations or Environmental Claims.
49
(h) The
Sellers and the Chinese Joint Venture have conducted off-site disposal of
hazardous waste only in compliance with applicable laws. To the Sellers’
Knowledge, neither any Seller nor the Chinese Joint Venture has transported
off-site for treatment, storage or disposal any Hazardous Substances from
its
operations that could reasonably give rise to liabilities under any
Environmental Law.
(i) As
provided in Schedule
4.21(i)
and
except for Releases authorized by Environmental Permits, the Sellers have
disclosed all Releases of Hazardous Substances known or that they have reason
to
know on, from, or to the Geismar Facility or the Monochem Facility that either
(A) exceeded the reportable quantity during the last three years or
(B) are on going and are reaching the soils and/or groundwater at the
Geismar Facility or the Monochem Facility.
(j) Neither
any Seller nor the Chinese Joint Venture have assumed or agreed to bear any
liabilities or obligations of any third party under any Environmental Law
other
than in connection with contractual agreements with the contractors performing
the Geismar Response Actions.
(k) The
Sellers have made available to the Purchaser (i) all material reports and
studies regarding the extent and nature of soil and groundwater contamination
resulting from Releases of Hazardous Substances from, on, at or under the
Real
Property and related material communications with Governmental Authorities,
(ii)
all material notices and communications with Governmental Authorities related
to
non-compliance with Environmental Laws and Environmental Permits during 2006
and
(iii) the most recent corporate PSM audit report.
4.22 Conduct
of the Business.
Except
as set forth on Schedule 4.22,
Chemtura and its Affiliates conduct the Business only through the Sellers
and
the Chinese Joint Venture and not through any other Person or any division
or
direct or indirect subsidiary or Affiliate of any Seller (other than the
Chinese
Joint Venture).
4.23 Foreign
Corrupt Practices.
Since
January 1, 2002, none of the Sellers nor the Chinese Joint Venture, any of
their
respective Affiliates, directors or officers or, to the Sellers’ Knowledge, any
representative, employee or agent thereof, has, for or on behalf of the Business
or in connection with this Agreement or the transactions contemplated hereby
(a) made any unlawful payment to a foreign or domestic government official
or employee or (b) violated in any material respect any applicable
provision of the U.S. Foreign Corrupt Practices Act, as amended.
4.24 EBITDA
for the EPDM Business.
Based
solely on information available to Chemtura as of the date hereof and
assumptions believed by Chemtura to be reasonable as of the date hereof,
to the
Sellers’ Knowledge, there is no reason to believe that EBITDA for the EPDM
Business for the 12 months ended December 31, 2007 will be less than the
amount
set forth on Schedule
4.24
(assuming operation of the EPDM Business in a manner generally consistent
with
the 2007 Budget).
50
4.25 Sale
of Products.
No
product manufactured or sold by the Business during the 12-month period
immediately preceding the date hereof has been the subject of any
Seller-initiated or the Chinese Joint Venture-initiated or other recall,
and, to
the Sellers’ Knowledge, no event has occurred and no condition or circumstance
exists that would reasonably be expected to give rise to any such recall.
During
the 12-month period immediately preceding the date hereof, there has not
been
any material level of product returns by customers of the Business, considered
in the aggregate, in respect of products supplied by the Business.
4.26 Chinese
Joint Venture.
Chemtura is the owner of 90% of the equity in the Chinese Joint Venture,
free
and clear of all Liens.
ARTICLE
5.
REPRESENTATIONS
AND WARRANTIES OF THE PURCHASER
The
Purchaser represents and warrants to the Sellers as follows:
5.1 Due
Incorporation.
The
Purchaser is a limited liability company duly organized, validly existing
and in
good standing under the laws of Delaware, and has all requisite limited
liability company power and authority to own, operate and lease its assets
and
to conduct its business as presently conducted.
5.2 Due
Authorization.
The
Purchaser has full limited liability company power and authority to execute,
deliver and perform this Agreement and its Related Agreements and to consummate
the transactions contemplated hereby and thereby. The execution, delivery
and
performance by the Purchaser of this Agreement and its Related Agreements
and
the consummation by the Purchaser of the transactions contemplated hereby
and
thereby have been duly authorized by all necessary limited liability company
action. The Purchaser has duly and validly executed and delivered this Agreement
and, at or prior to the Closing, will have duly and validly executed and
delivered each of its Related Agreements. Assuming the due authorization,
execution and delivery of this Agreement and the Related Agreements by each
Seller (as applicable), this Agreement constitutes, and each of the Related
Agreements will after the Closing constitute, the Purchaser’s legal, valid and
binding obligation, enforceable against it in accordance with its respective
terms, subject to the Enforceability Limitations.
5.3 Consents
and Approvals; Authority Relative to this Agreement.
(a) Except
for the Governmental Required Consents or as set forth on Schedule 5.3,
no
Consent of or with any Governmental Authority is necessary in connection
with
the execution, delivery or performance by the Purchaser of this Agreement
or any
of its Related Agreements or the consummation by the Purchaser of the
transactions contemplated hereby or thereby.
(b) Except
for the Governmental Required Consents or as set forth on Schedule 5.3,
the
execution, delivery and performance by the Purchaser of this Agreement and
its
Related Agreements, and the consummation by the Purchaser of the transactions
contemplated hereby and thereby, do not and will not: (i) violate any Law
applicable to or binding on the Purchaser or any of its assets; (ii) constitute
a breach or default of, or permit cancellation of, or result in the creation
of
any Lien upon any of the assets of the Purchaser under, or result in or
constitute a circumstance which, with or without notice or lapse of time
or
both, would constitute any of the foregoing under, any Contract to which
the
Purchaser or any of its Affiliates is a party or by which the Purchaser or
any
of its Affiliates or any of their respective assets is bound; (iii) permit
the
acceleration of the maturity of any indebtedness of the Purchaser or any
of its
Affiliates or indebtedness secured by any of their respective assets; or
(iv)
violate or conflict with any provision of the limited liability company
operating agreement or other organizational documents of the
Purchaser.
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5.4 Proceedings.
There
are no Proceedings pending, or, to the Purchaser’s Knowledge, threatened, by or
against the Purchaser or any of its Affiliates with respect to this Agreement
or
the Related Agreements, or in connection with the transactions contemplated
hereby or thereby.
5.5 Financing.
(a) The
Purchaser has obtained (i) a term sheet from a responsible financial institution
(the “Term
Sheet”)
setting forth certain terms and conditions of first-lien debt financing to
include the making of loans to and issuance of letters of credit for the
benefit
of the Purchaser and (ii) a letter (the “Financeability
Letter”)
referring to second-lien debt financing to be arranged through the private
debt
markets (collectively, the “Debt
Financing”),
in
amounts that if such Debt Financing is successfully obtained will be in the
aggregate, together with the amount of the Equity Financing and available
cash
resources of the Purchaser, sufficient to pay the amounts to be paid by the
Purchaser at the Closing under this Agreement and the fees and expenses incurred
by the Purchaser in connection with the transactions contemplated hereby.
The
Purchaser has made available to Chemtura true and complete copies of the
Term
Sheet and Financeability Letter
(b) The
Purchaser will, as of the Closing, have obtained up to $35 million in equity
(the “Equity
Financing”)
from
certain equity investors to fund in part the amounts to be paid at the Closing
under this Agreement.
ARTICLE
6.
COVENANTS
6.1 Access
to Information.
From
and after the date of this Agreement until the Closing Date, each Seller
shall
(and shall request its accountants and environmental consultants to), and
Chemtura shall cause the Chinese Joint Venture (and shall request its
accountants and environmental consultants) to, afford to the Purchaser and
its
accountants, counsel and other Representatives reasonable access, upon
reasonable notice during normal business hours, to all the personnel,
properties, books, contracts, commitments, Tax Returns and records of the
Business that relate to the Assets (but not including Tax Returns in respect
of
income generated by such Assets) and during such period shall furnish to
the
Purchaser any information of the Business relating to (and then only to the
extent relating to) the Assets which is reasonably available to the Sellers
or
the Chinese Joint Venture as the Purchaser may reasonably request; provided
that
nothing herein will obligate any Seller or the Chinese Joint Venture to (a)
take
any actions that would unreasonably interrupt the normal course of business
of
the Business (including conducting, or permitting the Purchaser to conduct,
any
environmental sampling or testing) or (b) violate any Law or the terms of
any
Contract to which any Seller or the Chinese Joint Venture or any Affiliate
of
any Seller is a party or to which any assets of any Seller or the Chinese
Joint
Venture or any Affiliate of any Seller are subject, and provided,
further,
that if
any particular document or other item containing information to which the
Purchaser has the right of access pursuant to this Section 6.1
contains
both (y) information related to the Business and (z) other information, then
the
applicable Seller or the Chinese Joint Venture may, at its option, either
(i) provide a copy of such document or item to the Purchaser subject to the
Purchaser’s obligations contained herein to keep such other information
confidential or (ii) redact (with reasonable promptness) such document or
item
and provide the Purchaser with access to such redacted form of document or
item
(which redacted form of document or item shall incorporate all information
that
the Purchaser has the right to access pursuant to this Section 6.1).
Notwithstanding anything to the contrary contained in this Section 6.1,
nothing
in this Section 6.1
shall
require any party to provide any other party with books and records or
information that constitute Privileged Documents.
52
6.2 Preservation
of Business.
From
the
date of this Agreement until the Closing Date, except as set forth on
Schedule 6.2
or as
contemplated by this Agreement (including any Employee Exhibit), each Seller
and
the Chinese Joint Venture shall operate the Business in the manner contemplated
by the 2007 Budget. Without limiting the generality of the foregoing, except
as
set forth on Schedule 6.2
or as
contemplated by this Agreement, prior to the Closing neither the Sellers
collectively in connection with the Business as it is conducted at the Geismar
Facility and the Monochem Facility nor the Chinese Joint Venture shall, without
the prior written consent of the Purchaser, which shall not be unreasonably
withheld or delayed:
(a) sell,
transfer, lease, license, convey or otherwise dispose of any Assets having
a net
book value, individually or in the aggregate, in excess of $25,000, except
in
the ordinary course of business and consistent with past practice or in
connection with the matters described in Schedule
4.9(e);
(b) acquire
or lease any material assets having a net book value, individually or in
the
aggregate, in excess of $10,000, except in the ordinary course of business
and
consistent with past practice;
(c) make
any
material changes in the accounting principles or practices of the Business,
except as required by GAAP or applicable Law;
(d) other
than supply arrangements in the ordinary course of business and consistent
with
past practice, enter into any material transaction with any Affiliate of
any
Seller (including another Seller);
(e) enter
into, adopt, amend or terminate any material bonus, profit sharing,
compensation, termination, stock option, stock appreciation right, restricted
stock, performance unit, pension, retirement, deferred compensation, employment,
severance or other employee benefit agreement, trust, plan or fund for the
benefit or welfare of any Business Employee, or materially increase the
compensation or benefits of any Business Employee, or enter into any Contract
to
do any of the foregoing, in each case except (i) in the ordinary course of
business or to the extent undertaken in connection with the implementation
of a
program that impacts all similarly situated employees of Chemtura and its
Affiliates, (ii) as required by Law or (iii) as required by the terms of
any
collective bargaining agreement;
53
(f) enter
into any Contract that (i) obligates the Sellers or the Chinese Joint Venture
to
make aggregate payments in excess of $25,000 and that would be binding upon
the
Business or the Assets after the Closing or (ii) that has a term of, or requires
the performance of any obligation by the Sellers or the Chinese Joint Venture
over a period in excess of, one year and that would be binding upon the Business
or the Assets after the Closing, in each case except in the ordinary course
of
business and consistent with past practice; provided
that in
no event shall any Seller or the Chinese Joint Venture enter into any hedging
arrangement or other derivative transaction that would be binding upon the
Business or the Assets after the Closing;
(g) (i) waive
or abandon any material rights under any of the Material Contracts,
(ii) repudiate any of its obligations under any Material Contract or
disaffirm or challenge the validity or enforceability thereof, (iii) amend
any Material Contract in a manner that would (A) adversely affect the use
or enjoyment thereof by the Purchaser or the Chinese Joint Venture,
(B) materially decrease the value thereof or (C) materially increase
the Purchaser’s or the Chinese Joint Venture’s obligations or liabilities
thereunder, (iv) terminate any Material Contract (except with respect to
purchase orders in the ordinary course of business consistent with past
practice) or (v) materially default in the performance of any obligation
under a Material Contract;
(h) waive
or
abandon or otherwise dispose of any rights in or to any Registered Intellectual
Property or any other material Transferred Intellectual Property;
(i) make
or
revoke any material election with respect to Taxes of the Chinese Joint Venture;
or
(j) enter
into any closing agreement or settlement agreement to settle any claim or
assessment for Taxes of the Chinese Joint Venture, or surrender any right
to
claim a refund of Taxes or otherwise offset any Tax Liability of the Chinese
Joint Venture.
6.3 Consents
and Approvals.
(a) On
the
terms and subject to the conditions of this Agreement, each party shall use
its
commercially reasonable efforts to cause the Closing to occur, including
taking
all reasonable actions necessary to comply promptly with all legal requirements
that may be imposed on it or any of its Affiliates with respect to the Closing.
Each of the Sellers, on the one hand, and the Purchaser, on the other hand,
shall not (and shall cause its respective Affiliates not to) take any actions
that would, or that could reasonably be expected to, result in any of the
conditions set forth in Article
7
or
Article
8,
respectively, not being satisfied. Notwithstanding anything to the contrary
contained in this Agreement, nothing contained herein shall require any party
to
waive its rights to terminate the Agreement hereunder or any condition to
its
obligation to consummate the transactions contemplated hereby.
For the
avoidance of doubt, the Seller shall be responsible for all requirements
under
sections 22a-134 through 22a-134e of the Connecticut General Statutes commonly
known as “the property transfer law” that may be applicable to acts, events or
circumstances occurring prior to the Closing as a result of the transactions
contemplated by this Agreement.
54
(b) In
furtherance and not in limitation of the provisions of Section 6.3(a),
the
Sellers and the Purchaser shall (i) file within 30 days after the date of
this Agreement with the Antitrust Division and the FTC the notification and
report form required under the HSR Act for the transactions contemplated hereby,
requesting early termination of the waiting period thereunder, (ii) respond
promptly to inquiries from the Antitrust Division or the FTC in connection
with
such filings, including providing any supplemental information that may be
requested by the Antitrust Division or the FTC and (iii) provide to the other
party copies of any filings made under the HSR Act at the time they are filed
with the Antitrust Division or the FTC, but excluding documents or disclosures
that reflect negotiations or valuations. Each of the Sellers and the Purchaser
shall furnish to the other such necessary information and reasonable assistance
as the other may request in connection with its preparation of any filing or
submission that is necessary under the HSR Act. The Sellers and the Purchaser
shall keep each other apprised of the status of any communications with, and
any
inquiries or request for additional information from, the Antitrust Division
or
the FTC. Each party shall use its commercially reasonable efforts to obtain
any
clearance required under the HSR Act for the consummation of the transactions
contemplated by this Agreement. The Sellers and the Purchaser shall also
cooperate to make any required filings, including any required filings under
the
Premerger Notification Provisions (and use commercially reasonable efforts
to
obtain any clearance required thereunder) and any required merger notification
under the Laws of Brazil as promptly as practicable after the execution and
delivery of this Agreement and, with respect to Brazil, no later than 15
business days after the execution and delivery of this Agreement.
(c) In
furtherance and not in limitation of the provisions of Section 6.3(a),
each
Seller and the Purchaser shall cooperate with the other parties with respect
to
obtaining and making the Consents of Governmental Authorities and act as if
all
notifications, filings, submissions and other evidence, and all assurances,
commitments or undertakings to be provided, or consent decrees to be entered
into, in such connection are required to be prepared and filed jointly by all
parties even if under particular circumstances they are formally made by only
one party. In particular, each Seller and the Purchaser shall promptly provide
drafts to the other parties, allow reasonably adequate time for comment by
the
other parties and consult promptly with the other parties with respect to the
contents of all notifications, filings, submissions, further documentation
and
evidence to be submitted to all relevant Governmental Authorities. Each Seller
and the Purchaser shall, in each case where permitted by the relevant
Governmental Authority, allow Persons nominated by the other parties to attend
all meetings with Governmental Authorities and, where appropriate, to make
oral
submissions at such meetings. The Purchaser and each Seller shall (i) furnish
to
the other such necessary information and reasonable assistance as the other
may
require in connection with its preparation of any notification, filing,
submission or further documentation or evidence that is necessary in obtaining
and making Consents of Governmental Authorities and (ii) promptly disclose
to
the other all correspondence received from or sent to any relevant Governmental
Authority in connection herewith and shall keep the other fully informed of
any
other related communication in whatever form with any of the relevant
Governmental Authorities. The Purchaser and each Seller shall comply promptly
with any inquiry or request for additional information from any relevant
Governmental Authority in connection herewith and shall promptly provide any
supplemental information requested in connection with the notifications, filings
and/or submissions made hereunder for the purposes of obtaining and making
the
Consents of Governmental Authorities.
55
(d) Each
party shall, and shall cause its Affiliates to, use its commercially reasonable
efforts (at its own expense) to obtain, and to cooperate in obtaining, all
Consents from third parties in respect of the Purchased Contracts to the extent
such Purchased Contracts require such Consents as a result of the transactions
contemplated hereby; provided,
however,
that
the parties shall not be required to pay or commit to pay any amount to (or
incur any obligation in favor of) any Person from whom any such Consent may
be
required (other than nominal filing or application fees). The Purchaser
acknowledges that certain Consents with respect to the transactions contemplated
by this Agreement may be required from parties to Contracts and that such
Consents have not been obtained. No Seller or any of their respective Affiliates
shall have any Liability whatsoever to the Purchaser arising out of or relating
to the failure to obtain any Consents from parties to Contracts that may be
required in connection with the transactions contemplated by this Agreement
or
because of the termination of any Purchased Contract as a result thereof, other
than any such failure or termination arising from a breach by the Sellers of
this Section 6.3(d).
(e) Each
party shall, and shall cause its Affiliates to, reasonably cooperate to transfer
any Permits, including any Environmental Permits, from the Sellers to the
Purchaser (or any applicable person designated by the Purchaser) and obtain
any
Consents from any Governmental Authorities related to any such Permits or
Environmental Permits to the extent such Permits or Environmental Permits are
transferable and subject to any required approvals by applicable Governmental
Authorities.
6.4 Chemtura
Names.
(a) The
Purchaser acknowledges that the Chemtura Names are and shall remain the property
of the Sellers or their Affiliates and that nothing in this Agreement shall
transfer or shall operate as an agreement to transfer any right, title or
interest in any Chemtura Name to the Purchaser or any Affiliate of the
Purchaser.
56
(b) Subject
to Sections 6.4(c)
and
(d),
no
Seller is granting the Purchaser a license to use, and neither the Purchaser
nor
any of its Affiliates shall have any title, right or interest in or to, any
Chemtura Name after the Closing.
(c) The
Sellers grant to the Purchaser pursuant to this Section 6.4(c)
a
limited transition trademark license solely for the purpose of transitioning
the
Chemtura Names after the Closing and for the purpose of selling existing
inventory of stocks, goods, products, services or software that include the
Chemtura Names. The Purchaser agrees that it shall acquire no rights whatsoever
in the Chemtura Names by virtue of its use during this transition period and
that all use of the Chemtura Names during this period shall inure to the benefit
of the Sellers and their Affiliates. Except as necessary in the performance
under the Purchaser Master Supply Agreement, the Purchaser agrees
that:
(i) as
soon
as reasonably practicable following the Closing, but in any event within
60 days
following the Closing Date, no stationery, purchase order, invoice, receipt
or
other similar document containing any reference to any Chemtura Name shall
be
printed, ordered or produced by or on behalf of the Purchaser or any of its
Affiliates and that the Purchaser shall, and shall cause all of its applicable
Affiliates to, (A) cease to use any stationery, purchase order, invoice, receipt
or other similar document containing any reference to any Chemtura Name or
(B)
only use such stationery, purchase order, invoice, receipt or other similar
document after having deleted, pasted over or placed a sticker over such
references;
(ii) as
soon
as reasonably practicable following the Closing, and in any event no later
than
120 days after the Closing Date, it will remove the Chemtura Names from all
visible premises, signs and vehicles which are included in the
Assets;
(iii) following
the Closing, no brochures, leaflets or similar documents and no packaging
containing any reference to any Chemtura Name shall be printed, ordered or
produced by or on behalf of the Purchaser or any of its Affiliates and, with
respect to existing brochures, leaflets or similar documents and packaging
containing a reference to any Chemtura Name, the Purchaser shall use its
commercially reasonable efforts to ensure that, as soon as reasonably
practicable but in no event later than 60 days following the Closing Date,
such
references are deleted, pasted over or have a sticker put over them;
and
(iv) it
shall
use its commercially reasonable efforts to ensure that, from and after the
Closing, no stocks, goods, products, services or software are manufactured
or
produced by or on behalf of the Purchaser or any of its Affiliates showing,
having marked thereon or using any Chemtura Name.
(d) Notwithstanding
any other provision of this Agreement, it is understood and agreed that the
remedy of indemnity payments pursuant to Article
12
and
other remedies at law would be inadequate in the case of any breach of the
covenants contained in this Section 6.4.
Accordingly, each Seller shall be entitled, without limiting its other remedies,
to equitable relief, including the remedy of specific performance or injunction,
with respect to any breach or threatened breach of such covenants and the
Purchaser (on behalf of itself and its Affiliates) consents to the entry
thereof.
57
6.5 Brokers.
Regardless of whether the Closing shall occur, (a) Chemtura shall indemnify
the
Purchaser and its Affiliates against, and hold the Purchaser and its Affiliates
harmless from, any and all liability for any brokers’ or finders’ fees or other
commissions arising with respect to brokers or finders retained or engaged
by
the Sellers or any of their Affiliates in respect of the transactions
contemplated by this Agreement, and (b) the Purchaser shall indemnify each
Seller and its Affiliates against, and hold each Seller and its Affiliates
harmless from, any and all liability for any brokers’ or finders’ fees or other
commissions arising with respect to brokers or finders retained or engaged
by
the Purchaser or any of its Affiliates in respect of the transactions
contemplated by this Agreement.
6.6 Preservation
of Books and Records; Access and Assistance.
(a) For
a
period of seven years
after the Closing Date or as otherwise required by applicable Law, the Purchaser
shall preserve and retain all Information and Records and other accounting,
legal, auditing and other books and records (including any documents relating
to
any governmental or non-governmental Proceedings or investigations with respect
to any Seller) relating to (i) the conduct of the Business or (ii) the
ownership of the Assets prior to the Closing Date. Notwithstanding the
foregoing, during such seven-year period, the Purchaser may dispose of any
such
books and records which are offered to, but not accepted by, the Sellers. If
at
any time after such seven-year period the Purchaser intends to dispose of any
such books and records, the Purchaser shall not do so without first offering
such books and records to the Sellers.
(b) From
and
after the Closing Date, the Sellers and the Purchaser shall permit each other
and its and their authorized representatives to have reasonable access, upon
reasonable advance notice, to, and to inspect and copy (at the requesting
party’s expense), all Information and Records and other accounting, legal,
auditing and other books and records (including any documents relating to any
governmental or non-governmental Proceedings or investigations with respect
to
any Seller) to the extent relating to (i) the conduct of the Business or (ii)
the ownership of the Assets, in each case, prior to the Closing Date and to
meet
with officers and employees of the Purchaser on a mutually convenient basis
in
order to obtain explanations and additional information with respect to such
Information and Records and books and records; provided,
however,
that
nothing herein will obligate (A) any party to take any actions that would
unreasonably interrupt the normal course of business of its business or (B)
any
Seller or the Purchaser to violate any Law or the terms of any Contract to
which
it or any of its Affiliates is a party or to which any its or its Affiliates’
assets are subject.
58
(c) In
the
event and for so long as any party hereto is prosecuting, participating in,
contesting or defending against any charge, complaint, Proceeding,
investigation, claim or demand in connection with (i) any transaction
contemplated under this Agreement or (ii) any fact, situation, circumstance,
status, condition, activity, practice, plan, occurrence, event, incident,
action, failure to act or transaction prior to the Closing Date involving any
Asset or the Business, each other party hereto shall (A) fully cooperate with
it
and its counsel in, and assist it and its counsel with, the prosecution,
participation, contest or defense, (B) make available its personnel (including
for purposes of fact finding, consultation, interviews, depositions and, if
required, as witnesses), and (C) provide such information, testimony and access
to its books and records, in each case as shall be reasonably requested in
connection with the prosecution, participation, contest or defense, all at
the
sole cost and expense (not including employee compensation and benefits costs)
of the prosecuting, participating, contesting or defending party (unless the
prosecuting, participating, contesting or defending party is entitled to
indemnification therefor under Article
12);
provided
that
nothing herein will obligate any party to (1) take any actions that would
unreasonably interrupt the normal course of business of its business or (2)
violate any Law or the terms of any Contract to which it or any of its
Affiliates is a party or to which any assets of it or any of its Affiliates
are
subject, and provided,
further,
that if
any particular document or other item containing information to which the
Purchaser has the right of access pursuant to this Section 6.6(c)
contains
both (Y) information related to the Business and (Z) other information, then
the
applicable Seller may, at its option, either (I) provide (with reasonable
promptness) a copy of such document or item to the Purchaser subject to the
Purchaser’s obligations contained herein to keep such other information
confidential or (II) redact (with reasonable promptness) such document or item
and provide the Purchaser with access to such redacted form of document or
item
(which redacted form of document or item shall incorporate all information
that
the Purchaser has the right to access pursuant to this Section 6.6(c)).
(d) Notwithstanding
anything to the contrary contained in this Section 6.6,
nothing
in this Section 6.6
shall
require any party to provide any other party with books and records or
information that are Privileged Documents. For the avoidance of doubt, this
Section 6.6
shall
not apply with respect to disputes between or among the parties hereto and/or
their Affiliates.
6.7 Insurance.
The
Purchaser acknowledges that (a) all of the insurance policies maintained by
the
Sellers or any of their Affiliates prior to the Closing Date will be terminated
with respect to the Business effective as of the Closing Date and (b) upon
such
termination, the Business will cease to be covered under such policies and
the
Purchaser will have to obtain replacement coverage (including coverage as the
Purchaser deems appropriate for the Assets, the operation of the Business and
the satisfaction of the Assumed Obligations).
6.8 Confidentiality.
(a) The
Purchaser acknowledges that, prior to or after the Closing, it may be furnished
with, receive or otherwise have access to information that is associated with
the Other Chemtura Businesses or relating to the Retained Obligations or
Excluded Assets, including information contained in Intellectual Property and
other technical and business proprietary non-public information (such
information, to the extent associated with the Other Chemtura Businesses or
relating to the Retained Obligations or the Excluded Assets, “Seller
Confidential Information”).
The
Purchaser further acknowledges that all Transferred Employees may have obtained
Seller Confidential Information in the course of their prior employment with
the
Sellers and their Affiliates. Effective upon, and only upon, the Closing, the
obligations under the Confidentiality Agreement to keep information confidential
shall terminate, and thereafter the provisions of this Section 6.8
shall
govern the parties’ obligations to keep confidential the Confidential
Information. For the avoidance of doubt, nothing contained in this Section 6.8
is
intended to restrict the Purchaser’s ability to use or disclose any information
related to the Business after the Closing or to restrict either party from
using
any Confidential Information in a dispute with the other party in relation
to
this Agreement.
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(b) Subsequent
to the Closing, the Purchaser shall not (and shall cause its and its Affiliates’
employees and other Representatives not to) disclose, and shall (and shall
cause
its employees to) maintain the confidentiality of, all Seller Confidential
Information.
(c) Subsequent
to the Closing, the Sellers shall not (and shall cause their and their
Affiliates’ employees and other Representatives not to) disclose, and shall (and
shall cause its employees to) maintain the confidentiality of, all information
relating to the Business, the Purchased Assets, the Purchased Contracts and
the
Assumed Obligations, including information contained in the Transferred
Intellectual Property and other technical and business proprietary non-public
information (collectively, “Purchaser
Confidential Information;”
the
Seller Confidential Information and the Purchaser Confidential Information
are
collectively referred to as “Confidential
Information”).
(d) With
respect to Seller Confidential Information, the Purchaser shall be referenced
herein as the “Receiving
Party,”
and
the Seller shall be referenced herein as the “Disclosing
Party.”
With
respect to Purchaser Confidential Information, the Seller shall be referenced
herein as the “Receiving
Party,”
and
the Purchaser shall be referenced herein as the “Disclosing
Party.”
Each
Receiving Party shall use at least the same degree of care to safeguard and
to
prevent the disclosure, publication, dissemination, destruction, loss or
alteration of the Disclosing Party’s Confidential Information as it employs to
avoid unauthorized disclosure, publication, dissemination, destruction, loss,
or
alteration of its own information (or information of its customers) of a similar
nature, but in no case less than reasonable care. Each Receiving Party agrees
that it shall not (and shall cause its and its Affiliates’ employees and other
Representatives not to) (i) use any of the Disclosing Party’s Confidential
Information in any manner, (ii) make any copies of any of the Disclosing Party’s
Confidential Information, (iii) acquire any right in or assert any Lien against
any of the Disclosing Party’s Confidential Information, (iv) sell, assign,
transfer, lease, license or otherwise dispose of any of the Disclosing Party’s
Confidential Information to third parties or commercially exploit any of the
Disclosing Party’s Confidential Information, including through derivative works,
or (v) refuse for any reason (including a default or breach or threatened breach
of this Agreement or any Related Agreement by the Disclosing Party) to promptly
provide any tangible embodiments of the Disclosing Party’s Confidential
Information (including copies thereof) to the Disclosing Party if requested
to
do so, in the form reasonably requested. In the event that the Receiving Party
or any of its Affiliates is requested or required by applicable Law, regulation
or legal process to disclose any of the Disclosing Party’s Confidential
Information, the Receiving Party shall (A) provide the Disclosing Party with
prompt written notice so that the Disclosing Party may seek a protective order
or other appropriate remedy or waive compliance with the provisions of this
Section 6.8(d)
and (B)
cooperate with the Disclosing Party in any reasonable effort the Disclosing
Party undertakes to obtain a protective order or other remedy. In the event
that
such protective order or other remedy is not obtained or the Disclosing Party
waives compliance with the provisions of this Section 6.8(d),
the
Receiving Party shall disclose to the Person compelling disclosure only that
portion of the Disclosing Party’s Confidential Information that the Receiving
Party is advised by written opinion of counsel is legally required and shall
use
its commercially reasonable efforts to obtain reliable assurance that
confidential treatment is accorded the Disclosing Party’s Confidential
Information so disclosed, to the extent available.
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(e) Nothing
contained in this Agreement shall be construed as obligating either party or
any
of its Affiliates to disclose any Confidential Information to the other party,
or as granting to or conferring on either party, expressly or impliedly, any
right, title, interest or license in or to any of the other party’s Confidential
Information or any components thereof.
(f) Notwithstanding
anything to the contrary, Confidential Information shall not include any
information that (i) is or becomes publicly known through no fault of the
Receiving Party, (ii) was already known to the Receiving Party (except,
(A) in the case of the Sellers after the Closing, for information related
to the Business or the Purchaser and (B) in the case of the Purchaser after
the Closing, for information relating to Other Chemtura Businesses to which
the
Purchaser has access as a result of its acquisition of the Business or its
performance of its obligations under the Purchaser Master Supply Agreement)
or
becomes available to the Receiving Party from a Person who does not have an
obligation of confidence with respect to such information, or (iii) is
independently developed for the Receiving Party by Persons who do not have
access to the Disclosing Party’s Confidential Information.
(g) Notwithstanding
any other provision of this Agreement, it is understood and agreed that the
remedy of indemnity payments pursuant to Article
12
and
other remedies at law may be inadequate in the case of any breach or threatened
breach of the covenants contained in this Section 6.8.
Accordingly, the owner of the Confidential Information shall be entitled to
seek
equitable relief, including the remedies of specific performance and injunction,
with respect to any breach or attempted breach of such covenants by the other
party.
6.9 Guarantees;
Credit Support.
(a) The
Purchaser will cooperate with the Sellers in obtaining, and use its commercially
reasonable efforts to obtain, at or prior to the Closing, a full and
unconditional release of all Business Guarantees, including by agreeing to
enter
into replacement credit support in favor of any third party creditor who is
a
beneficiary of such Business Guarantee.
(b) Each
Seller shall, and shall cause each of its Affiliates to, use commercially
reasonable efforts to cause all credit support in favor of any Seller with
respect to the Business (e.g., any letters of credit backing obligations to
any
Seller with respect to any accounts or supplies or services) to be amended
or
replaced such that such credit support is on substantially similar terms that
are no less favorable in the aggregate to that in favor of such Seller except
that it is in favor of the Purchaser on the Closing Date.
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6.10 Taxes.
(a) Tax
Returns.
(i)
With respect to all Tax Returns required to be filed by or with respect to
the
Chinese Joint Venture for a Pre-Closing Tax Period (a “Pre-Closing
Tax Return”)
(A)
the Sellers shall prepare and timely file, and cause to be filed, all such
Tax
Returns required to be filed prior to the Closing Date, and (B) the Purchaser
shall prepare and timely file, or cause to be prepared and timely filed, all
such Tax Returns required to be filed after the Closing Date. Not later than
five days prior to the due date for the payment of Tax with respect to each
Pre-Closing Tax Return, the Sellers shall timely pay to the Purchaser the amount
owed, if any, to the Purchaser pursuant to Section
12.2
with
respect to such Pre-Closing Tax Return. Not later than 30 days prior to the
due
date of each Pre-Closing Tax Return (including extensions thereof), the party
preparing such Tax Return shall provide a copy of such Tax Return to the other
party, together with the work papers and schedules utilized in its preparation,
for the other party’s review and comment, which comments shall not be
unreasonably withheld. The party preparing such Tax Return shall provide a
copy
of the final Pre-Closing Tax Returns to the other party promptly after filing.
(ii) The
Purchaser shall cause to be prepared and duly filed all Tax Returns required
to
be filed by or with respect to the Chinese Joint Venture for all Straddle
Periods. Not later than 30 days prior to the due date of each Tax Return that
relates to a Straddle Period (“Straddle
Period Tax Return”)
(including extensions thereof), the Purchaser shall deliver to the applicable
Seller a copy of such Tax Return for such Seller’s review and comment, which
comments shall not be unreasonably withheld. Not later than five days prior
to
the due date for the payment of Tax with respect to each Straddle Period Tax
Return, the Sellers shall pay to the Purchaser the amount owed, if any, to
the
Purchaser pursuant to Section 12.2
with
respect to such Tax Return. Upon receipt thereof, the Purchaser shall pay the
Taxes shown due thereon.
(iii) The
Purchaser shall provide a copy of all final Straddle Period Tax Returns to
the
Sellers promptly after filing. The Sellers, the Purchaser and the Chinese Joint
Venture shall cooperate fully, as and to the extent reasonably requested, in
connection with the filing of the Pre-Closing Tax Returns and Straddle Period
Tax Returns and any audit, litigation or other proceeding with respect to such
Tax Returns.
(b) Pre-Closing
Portion of Straddle Period Taxes.
For
purposes of determining the indemnification payment, if any, under Section 12.2(e),
in the
case of Taxes that are payable by or with respect to the Chinese Joint Venture
with respect to any Straddle Period, the portion of any such Tax that is
attributable to the portion of the period ending on day immediately preceding
the Closing Date shall be:
(i) in
the
case of Taxes that are either (A) based upon or related to income or receipts,
or (B) imposed in connection with any sale or other transfer or assignment
of
property (real or personal, tangible or intangible), deemed equal to the amount
that would be payable if the Taxable year or period ending on (and including)
the day immediately preceding the Closing Date; and
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(ii) in
the
case of Taxes that are imposed on a periodic basis with respect to the assets
of
the Chinese Joint Venture, deemed to be the amount of such Taxes for the entire
period (or, in the case of such Taxes determined on an arrears basis, the amount
of such Taxes for the immediately preceding period), multiplied by a fraction
the numerator of which is the number of calendar days in the portion of the
period ending on (and including) the day immediately preceding the Closing
Date
and the denominator of which is the number of calendar days in the entire
period.
(c) Property
Taxes.
The
party considered to be the owner of record under the applicable state law shall
be responsible for filing any returns and paying any tax due with respect to
all
real estate, personal property and similar ad valorem Taxes relating to the
Assets applicable to periods beginning before or on the Closing Date and ending
after Closing Date (“Property
Taxes”).
Notwithstanding the preceding sentence, Property Taxes shall be prorated based
on the assessment for the relevant calendar year (unless such Property Taxes
are
paid in arrears and the Closing takes place during calendar year 2007 and the
assessment for the calendar year 2007 shall not be available, in which case
the
assessment for calendar year 2006 shall be used, subject to a true-up when
the
2007 assessment is issued) and the number of days in such period that occur
before the Closing Date, on the one hand, and the number of days in such period
that occur on or after the Closing Date, on the other hand, with the amount
of
such Taxes allocable to the portion of the period ending on the Closing Date
being the responsibility of the Sellers and the remainder being the
responsibility of the Purchaser. In the event that the amount of Property Taxes
actually assessed differs from the amount used in the proration, the proration
shall be revised based upon the final assessment. The Purchaser or Sellers,
as
the case may be, shall reimburse the other party for Property Taxes paid within
fifteen days of payment by the other party, to the extent such party is liable
for the Property Taxes pursuant to this Section 6.10(c)
and such
Taxes are paid by the other party. The parties shall cooperate fully, as and
to
the extent reasonably requested, in connection with the filing of any Tax
Returns relating to Property Taxes and any audit, litigation or other proceeding
with respect to such Tax Returns.
(d) Taxes
Related to Transaction.
All
sales, use, transfer, real property transfer, value added, recording,
registration, notary, stamp, stamp duty or similar Taxes and fees (“Transfer
Taxes”),
and
all recording costs, arising out of the transfer of the Assets pursuant to
this
Agreement and all costs and expenses incurred in connection with the
transferring and recording of title to the Assets shall be apportioned fifty
percent to the Sellers and fifty percent to the Purchaser. The Tax Returns
relating to such Transfer Taxes shall be timely prepared by the party legally
obligated to make such filing, and such party will use its commercially
reasonable efforts to provide such Tax Returns to the other party at least
ten
days prior to the due date for such Tax Returns. The parties agree to cooperate
with each other in connection with the preparation and filing of such Tax
Returns, in obtaining all available exemptions from such Transfer Taxes, in
timely providing each other with resale certificates and any other documents
necessary to satisfy any such exemptions and in any audit, litigation or other
proceeding with respect to such Tax Returns.
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(e) Procedures
Relating to Tax Claims.
The
Purchaser and the Sellers shall cooperate fully, as and to the extent reasonably
requested, in connection with any audit, litigation or other proceeding with
respect to Taxes and Tax Returns (other than a proceeding described in
Article
12 which
shall be governed by Article
12).
Such
cooperation shall include the retention, and (upon the other party’s request)
the provision, of records and information which are reasonably relevant to
any
such audit, litigation or other proceeding and making employees available on
a
mutually convenient basis to provide additional information and explanation
of
any material provided hereunder; provided,
however,
the
party requesting assistance shall pay the reasonable out-of-pocket expenses
incurred by the party providing such assistance; provided,
further,
no
party shall be required to provide assistance at times or in amounts that would
interfere unreasonably with the business and operations of such party. The
Sellers agree to retain all books and records with respect to Tax matters
pertinent to the Chinese Joint Venture relating to the Tax periods ending prior
to the Closing Date, until the expiration of any applicable statute of
limitations or extensions thereof.
6.11 Certain
Restrictions.
(a) For
a
period of four years after the Closing Date, the Sellers shall not, and shall
cause their Affiliates not to, directly or indirectly:
(i) engage
in
the business of manufacturing, marketing and distributing, or performing
research and development with respect to, products of the EPDM Business and
the
Rubber Chemicals Business that were manufactured during the 24
months prior
to
the Closing (any such product, a “Prohibited
Product”),
in
each case as conducted by the Sellers during the 24 months prior to the Closing
Date in any country in which any Seller conducts such business during the 24
months prior to the Closing Date (a “Competing
Business”),
or
(ii) have
a
financial interest in (including as a shareholder, member, partner, owner,
lender, creditor or in any similar capacity) any Competing
Business.
(b) Notwithstanding
the terms of Section 6.11(a),
nothing
in Section 6.11(a)
shall
prohibit or otherwise restrict any Seller or any of its Affiliates
from:
(i) carrying
on or developing any business other than any Competing Business;
(ii) acquiring
the whole or any part of a Person which carries on all or a portion of any
Competing Business or the whole or any part of a business which includes the
carrying on of all or a portion of any Competing Business, except that where
more than $5,000,000 of the revenues of the Person or of the business acquired
as set out in the latest available annual financial statements of that Person
or
business consists of a Competing Business, such Seller or Affiliate of such
Seller shall use its commercially reasonable efforts to dispose of (including
by
terminating operations relating to the Competing Business or diverting those
assets to a business other than a Competing Business) such assets within 12
months of such acquisition (which 12 month period shall be extended for an
additional six months, but only so long as the relevant Seller or Affiliate
of
such Seller is making diligent efforts to dispose of such assets);
64
(iii) owning
(A) less than an aggregate of 5% of any class of stock traded on a national
exchange of a Person engaged, directly or indirectly, in all or a portion of
any
Competing Business; or (B) less than 5% in value of the indebtedness of a Person
engaged, directly or indirectly, in all or a portion of any Competing
Business;
(iv) marketing
and selling Celogen® OT, Celogen® AZ and Celogen® AZ blends for use in any
applications other than rubber;
(v) selling,
marketing and distributing (A) I-3 or (B) EPDM, in each case for use
in Royaltuf® and plastic additives;
(vi) manufacturing
PPD Products solely for sale to the Purchaser or its designee in accordance
with
the terms of the Chemtura Master Supply Agreement; or
(vii) manufacturing,
marketing or selling any product that includes as an ingredient or component
any
Prohibited Product, if the Prohibited Product constitutes less than 50% of
such
product or if the Prohibited Product undergoes a chemical
transformation.
(c) Notwithstanding
any other provision of this Agreement, it is understood and agreed that the
remedy of indemnity payments pursuant to Article
12
and
other remedies at law may be inadequate in the case of any breach or threatened
breach of the covenants contained in Section 6.11(a).
Accordingly, the Purchaser shall be entitled to seek equitable relief, including
the remedy of specific performance, with respect to any breach or attempted
breach of such covenants.
(d) Notwithstanding
anything to the contrary contained in this Agreement, Section 6.11(a)
shall
not apply to any third party which (i) acquires (A) a majority equity interest
in Chemtura or in any of the Affiliates of Chemtura or (B) all or substantially
all of the business or assets of Chemtura or any Affiliates of Chemtura,
regardless of the form of such transaction and (ii) was a competitor of the
Business at the time of such acquisition. If the requirements of the preceding
sentence are satisfied, then Section 6.11(a)
shall
also not apply to any of the Affiliates of such third party (other than the
entity Chemtura and the entities which were Affiliates of Chemtura prior to
such
acquisition).
6.12 Purchaser’s
Option.
The
Sellers hereby grant the Purchaser an option to purchase the assets described
on
Schedule
6.12,
exercisable in accordance with and on the terms and conditions set forth in
Schedule
6.12.
6.13 Naugatuck
Equipment.
(a) The
Purchaser shall remove, within one month after the expiration of the term of
the
Ground Lease (as it may be extended pursuant to the terms thereof), at its
own
cost and expense, during normal business hours and without causing damage,
Liability or material interruption to the applicable Seller’s business or
assets, the technical service equipment included in the Naugatuck Equipment
from
the 112 Building located at the Naugatuck Site (the “Naugatuck
Technical Service Equipment”).
If
the Purchaser fails to so remove any Naugatuck Technical Service Equipment,
(i) all of the Purchaser’s right, title and interest in and to any such
Naugatuck Technical Service Equipment shall automatically be transferred to
the
Seller of such Naugatuck Technical Service Equipment without any further action
being required on the part of such Seller or the Purchaser and (ii) the
Purchaser hereby grants an irrevocable power of attorney to each Seller of
Naugatuck Technical Service Equipment granting such Seller the power to execute
the necessary transfer documents on its behalf to cause any such transfer to
be
effective.
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(b) The
Purchaser shall, within six months after the Closing, remove, at its own cost
and expense, during normal business hours and without causing damage, Liability
or material interruption to the applicable Seller’s business or assets, the
pilot plant equipment included in the Naugatuck Equipment from the 110 Building
located at the Naugatuck Site (the “Pilot
Plant Equipment”).
If
the Purchaser fails to so remove any such Pilot Plant Equipment, (i) all of
the Purchaser’s right, title and interest in and to any such Pilot Plant
Equipment shall automatically be transferred to the Seller of such Pilot Plant
Equipment without any further action being required on the part of such Seller
or the Purchaser and (ii) the Purchaser hereby grants an irrevocable power
of
attorney to each Seller of Pilot Plant Equipment granting such Seller the power
to execute the necessary transfer documents on its behalf to cause any such
transfer to be effective.
6.14 Chemtura’s
Option.
The
Purchaser hereby grants Chemtura an option to purchase the assets described
on
Schedule
6.14,
exercisable in accordance with and on the terms and conditions set forth in
Schedule
6.14.
6.15 Decommissioning
of Wastewater Tank.
The
Sellers shall decommission (the “Wastewater
Tank Decommissioning”)
the
2,400,000 gallon on-site wastewater tank referred to as tank WV-001 (the
“Wastewater
Tank”)
within
the time period set forth on Schedule
6.15.
The
Sellers shall comply with all applicable Environmental Laws and Permits in
decommissioning the Wastewater Tank and in disposing of any materials, including
any Hazardous Substance, that may exist in the Wastewater Tank as of the time
it
is decommissioned. The Wastewater Tank Decommissioning, including all necessary
testing and remediation, shall be completed at the Sellers’ own cost and
expense, during normal business hours and without causing damage, Liability
or
material interruption to the Purchaser’s business or assets. The Sellers agree
to coordinate their efforts with the Purchaser to minimize interruptions to
the
Purchaser’s business or assets and to ensure compliance with all applicable
Environmental Laws and Permits.
6.16 Financial
Assurance.
The
applicable Seller shall arrange for and maintain, in the name of the Purchaser,
the Sellers’ Financial Assurance Obligations, subject to the provisions of
Schedule
12.9(a).
The
Purchaser shall arrange for and maintain the Purchaser’s Financial Assurance
Obligations. In addition, the Purchaser shall be responsible for mowing the
Geismar Landfill cap as required by the RCRA Permit and shall not make a claim
under Section
12.9
or any
other section of this Agreement for indemnification or reimbursement for the
costs of such mowing.
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6.17 Financial
Statements.
(a) As
soon
as practicable after the date hereof, the Sellers shall prepare and deliver
to
the Purchaser (i) the audited combined statement of net assets of the
Business as of December 31, 2006 and the related audited combined statement
of
revenues and expenses of the Business for the year then ended and (ii) the
audited statements of net assets of the EPDM Business as of December 31, 2004
and 2005 and
the
related audited statement of revenues and expenses of the EPDM Business for
the
years then ended
(together with any notes thereto and the report of an independent auditor
reasonably acceptable to the Purchaser thereon, which report shall be
substantially in the form attached as Schedule
6.17(a),
the
“Audited
Special Purpose Financial Statements”)
and
any supporting schedules used in connection with the preparation therewith.
The
Audited Special Purpose Financial Statements shall be prepared by the Sellers
in
accordance with GAAP (except as set forth in the notes thereto), consistently
applied, and shall contain a reconciliation of the combined statement of net
assets as of December 31, 2006 and the related combined statement of revenues
and expenses for the year then ended prepared in accordance with GAAP and those
same statements prepared in accordance with the Calculation Principles (the
“Reconciliation”).
The
Reconciliation shall contain such level of detail as may be required to
calculate 2006 EPDM EBITDA, 2006 Rubber Chemicals EBITDA and the amount of
capital expenditures made or accrued by the Business during the year ended
December 31, 2006, in each case in accordance with the Calculation Principles.
Notwithstanding any reference in any Audited Special Purpose Financial Statement
to the inclusion of certain assets to be sold and liabilities to be transferred,
the only assets to be sold by the Sellers are the Assets and the only
liabilities to be assumed by the Purchaser are the Assumed
Liabilities.
(b) The
Sellers shall deliver to the Purchaser as soon as practicable monthly financial
reports for the Business that are prepared internally by the Sellers’ management
for any calendar month falling within the period from January 1, 2007 through
the end of the Relevant Month (the “Interim
Financial Statements”).
6.18 Customer
Accounts Receivable.
The
Sellers and the Purchaser shall cooperate in good faith in order to ensure
that
the applicable Seller receives payment of any account, trade or note receivable
or other payment from a customer or any other obligor to the extent relating
to
any Other Chemtura Business and that the Purchaser receives payment of any
account, trade or note receivable or other payment from a customer or any other
obligor (other than Foreign Accounts Receivable or the Retained PPD Receivables)
to the extent relating to the Business. As promptly as practicable after the
Closing, the parties will reasonably cooperate to notify each account debtor
of
any Account Receivable of the Purchaser’s identity and the account which the
Purchaser has designated for receipt of payments in a letter in form and
substance reasonably satisfactory to the Purchaser. To the extent that either
the Purchaser, on the one hand, or a Seller, on the other hand, determines
that
it has received payment of an account, trade or note receivable or other payment
from a customer or any other obligor owned by the other (including by way of
notice from the other), the receiving party agrees to promptly (and in any
event
as promptly as practicable but in no event later than five Business Days after
making such determination) remit such payment to the designated bank account
of
the owner of such receivable or payment.
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6.19 Customer
Returns and Warranty Support Services.
The
Purchaser shall perform or pay for the performance of warranty services and
other similar obligations with respect to the Retained Product Claims (including
replacement or refund obligations) in accordance with the warranty terms
contained in the applicable Contracts (the “Warranty
Obligations”),
and
Chemtura shall (a) promptly reimburse the Purchaser for the Purchaser’s
actual costs to perform or (b) pay for the performance of such Warranty
Obligations, less the actual value of any products actually received by the
Purchaser in a return transaction (“Warranty
Costs”).
Upon
the receipt by Chemtura of a written report from the Purchaser, including
supporting documentation, setting forth the details of any Warranty Obligations
performed or paid for by the Purchaser, Chemtura shall promptly, but in no
event
later than ten Business Days after receipt of any such written report, reimburse
the Purchaser for its Warranty Costs in respect of such Warranty Obligations.
The Sellers reserve the right to make reasonable audits of the Purchaser’s
invoices with respect to requests for reimbursement under this Section 6.19,
and the
Purchaser shall provide to the Sellers such reasonable information and
reasonable access to the Purchaser’s records necessary to complete any such
audit.
6.20 Certain
Matters Regarding Financing.
The
Purchaser shall use its commercially reasonable efforts to secure as promptly
as
reasonably practicable the Debt Financing contemplated by the Term Sheet and
the
Financeability Letter, subject to the availability of such financing on
commercially reasonable terms; provided,
however,
that
nothing contained herein shall obligate the Purchaser to secure any debt
financing arranged or provided by the arranger contemplated therein or any
affiliate thereof. In the event the Purchaser determines that the condition
precedent set forth in Section
7.9
cannot
be satisfied, it shall promptly notify the Sellers of such
determination.
6.21 Intellectual
Property Rights Actions.
Schedule 6.21
sets
forth a true and complete list of all actions that, to the Sellers’ Knowledge,
must be taken within six months following the date hereof to maintain the
existence or validity of the Registered Intellectual Property.
6.22 Attorney-Client
Privilege.
In the
event either party or any of its Affiliates or representatives gains access
to
the Privileged Documents of another party, whether inadvertently or otherwise,
such party agrees not to contest any assertion of privilege by the party to
which such privilege belongs by reason of such access.
6.23 Filing
of Assignments.
The
Sellers shall, at the Sellers’ sole cost, within a commercially reasonable time
after the Closing, deliver to the Purchaser evidence that the Sellers have
taken
commercially reasonable steps to cause documents to be properly filed with
the
applicable U.S. and foreign Governmental Authority, in form and substance
sufficient to evidence in the records of such Governmental Authority a chain
of
title showing (a) the Sellers’ sole and exclusive ownership (prior to transfer
to the Purchaser) of the Transferred Patents and Transferred Trademarks (to
the
extent subject to a registration or an application for registration) free and
clear of any Lien other than Permitted Liens, and (b) the Sellers’ sole and
exclusive ownership of any and all patents and patent applications licensed
to
the Purchaser under the License Agreements. The Sellers shall provide the
Purchaser with copies of the Sellers’ submittals to the Governmental Authority
and copies of any receipts or confirmations acknowledging such
filing.
68
6.24 Key
Employees.
The
Sellers shall provide reasonable cooperation with the Purchaser’s efforts to
obtain non-competition agreements in forms reasonably acceptable to the
Purchaser from the Business Employees listed on Schedule 6.24.
6.25 Certain
Related Agreements.
Prior
to the Closing, each Seller and the Purchaser shall negotiate in good faith
regarding, and shall dedicate adequate resources and use commercially reasonable
efforts to mutually agree upon the forms and terms of the Chemtura Master Supply
Agreement, the Ground Lease, the License Agreements (other than the Chinese
Trademark License Agreement) and the Transition Services Agreement.
6.26 Receivables
Securitization Agreements.
Chemtura shall use commercially reasonable efforts to obtain as promptly as
reasonably practicable all
Consents required under the Receivables Securitization Agreements (including,
where necessary, Consents of the applicable Persons to the repurchase by
Chemtura of Accounts Receivable) for the consummation of the transactions
contemplated by this Agreement from the applicable parties thereto and to cause
the release of all Liens in respect of any and all Assets
subject to any Lien thereunder.
6.27 Chinese
Joint Venture.
Chemtura shall use commercially reasonable efforts to purchase the 10% equity
interest in the Chinese Joint Venture from China National Chemical Construction
Jiangsu Company and to obtain the necessary Chinese Consents to such purchase
such that as of the Closing, Chemtura shall own 100% of the equity interest
in
the Chinese Joint Venture free and clear of all Liens.
6.28 Foreign
Accounts Receivable.
At the
Closing, Chemtura shall issue to the Purchaser a promissory note in original
principal amount equal to the aggregate amount of the Foreign Accounts
Receivable (excluding the Factored Accounts Receivable and net of related
reserves and VAT taxes) as reflected on the Estimated Closing Statement,
substantially in the form set forth in Exhibit
L
(the
“Accounts
Receivable Note”),
such
promissory note to (1) have a term of 90 days, (2) be payable
bi-weekly in equal installments, (3) be unsecured and (4) bear no
interest.
6.29 Adjustments
to Pre-Signing Financial Statements.
(a) The
parties agree and acknowledge that the 2006 Pre-Signing Financial Statements
set
forth in Schedule
4.4
and the
Calculation Principles set forth in Schedule
1.1(c),
in each
case as of the date hereof are preliminary and are subject to good faith review
by Chemtura and the Purchaser and that the Net Working Capital Threshold Amount
has been determined based on the 2006 Pre-Signing Financial Statements. The
parties shall have until February 28, 2007 to continue their good faith review
of the 2006 Pre-Signing Financial Statements and agree to cooperate with each
other in such review.
(i) If
neither Chemtura nor the Purchaser delivers any comments on the 2006 Pre-Signing
Financial Statements to the other on or prior to February 28, 2007, then on
March 1, 2007, the 2006 Pre-Signing Financial Statements and Net Working Capital
Threshold shall be deemed to be final and not subject to adjustment pursuant
to
this Section
6.29.
69
(ii) If
either
Chemtura or the Purchaser delivers to the other comments to the 2006 Pre-Signing
Financial Statements on or prior to February 28, 2007, the Purchaser and
Chemtura shall use their respective commercially reasonable efforts to negotiate
in good faith to (A) address all such comments to their mutual satisfaction
and (B) agree to appropriate adjustments, if any, to the Pre-Signing
Financial Statements, the Net Working Threshold Amount and, if necessary, the
Calculation Principles. Any agreement between the Purchaser and Chemtura
pursuant to this Section
6.29(a)(ii)
shall be
in writing and shall set forth the agreed-upon Pre-Signing Financial Statements,
Net Working Capital Threshold Amount and Calculation Principles, which shall
thereafter be final and binding upon the parties for all purposes of this
Agreement.
(iii) To
the
extent that the parties are unable to resolve any such comments or agree on
any
appropriate adjustments to the Pre-Signing Financial Statements, Net Working
Capital Threshold Amount and Calculation Principles (the “Unresolved
Comments”)
within
40 days following
the date hereof, the Unresolved Comments shall be submitted at the request
of
either Chemtura or the Purchaser to the Accounting Firm for arbitration in
accordance with the procedures set forth in Section
3.2(c)(iv);
provided
that the
scope of the review by the Accounting Firm will be limited to a determination
of
the appropriate adjustments and modifications, if any, to the Pre-Signing
Financial Statements, the Net Working Capital Threshold Amount and the
Calculation Principles resulting from the Unresolved Comments. Such
determination by the Accounting Firm shall be final and binding upon the
parties, and Chemtura shall, within 10 days following such determination,
deliver to the Purchaser the Pre-Signing Financial Statements and Calculation
Principles, as adjusted in accordance with the Accounting Firm’s determination,
at which point the Pre-Signing Financial Statements, the Net Working Capital
Threshold Amount and the Calculation Principles shall be final and binding
upon
the parties.
(b) Upon
the
Pre-Signing Financial Statements and Calculation Principles, as adjusted,
becoming final and binding in accordance with Section
6.29(a)(ii)
or
(a)(iii),
such
final Pre-Signing Financial Statements and Calculation Principles shall be
deemed to supersede and replace for all purposes of this Agreement
(retroactively to the date of this Agreement) the Pre-Signing Financial
Statements set forth on Schedule
4.4
and the
Calculation Principles set forth on Schedule
1.1(c).
ARTICLE
7.
CONDITIONS
PRECEDENT TO OBLIGATIONS OF THE PURCHASER
The
obligations of the Purchaser to consummate the transactions contemplated by
this
Agreement are subject to the satisfaction or waiver by the Purchaser of the
following conditions precedent on or before the Closing Date:
7.1 Representations
and Warranties True.
The
representations and warranties of each of the Sellers contained herein shall
have been accurate, true and correct in all material respects on and as of
the
date hereof (except with respect to representations and warranties that are
qualified by materiality or Business Material Adverse Effect, which
representations and warranties shall have been accurate, true and correct in
all
respects on and as of the date hereof) and, except to the extent that any such
representation or warranty is expressly made solely as of the date hereof or
as
of another date earlier than the Closing Date, shall also be accurate, true
and
correct in all material respects on and as of the Closing Date (except with
respect to representations and warranties that are qualified by materiality
or
Business Material Adverse Effect, which representations and warranties shall
be
accurate, true and correct in all respects on and as of the Closing Date).
Notwithstanding any of the foregoing, if one or more of any such representations
or warranties contained herein are not accurate, true and correct in all
material respects (or in all respects, as the case may be) on and as of the
date
hereof and, except to the extent that any such representation or warranty is
made solely as of the date hereof or as of another date earlier than the Closing
Date, on and as of the Closing Date, the conditions precedent in this
Section 7.1
shall
nevertheless be deemed satisfied unless the inaccuracy, falsity or incorrectness
of such representations or warranties would reasonably be expected to have
a
Business Material Adverse Effect.
70
7.2 Compliance
with Agreements and Covenants.
Each
Seller shall have in all material respects performed and complied with all
of
its respective covenants and agreements contained in this Agreement to be
performed and complied with by it on or prior to the Closing.
7.3 Certificate
of Compliance.
The
Sellers shall have delivered to the Purchaser a certificate of each of the
Sellers dated as of the Closing Date, executed by a duly authorized senior
officer of each of the Sellers, certifying as to the satisfaction of the
conditions set forth in Sections 7.1
and
7.2.
7.4 HSR
Act; Premerger Notification Provisions; Brazil.
(a) Any
applicable waiting period under the HSR Act shall have expired or have been
terminated without action by the Antitrust Division or the FTC to prevent
consummation of the transactions contemplated hereby, (b) any waiting
period or suspensory obligation under any Premerger Notification Provision
shall
have expired or been terminated, (c) all applicable filings, consents and
approvals under any Premerger Notification Provision, the absence of which
would
prohibit the consummation of the transactions contemplated by this Agreement,
shall have been made or obtained and (d) the notification of this Agreement
shall have been made in Brazil to the Ministry of Justice of Brazil no later
than the 15th business day after the date of the execution and delivery of
this
Agreement.
7.5 Governmental
Required Consents.
The
Governmental Required Consents shall have been obtained, and the requirements
under sections 22a-134 through 22a-134e of the Connecticut General Statutes
(if
applicable to acts, events or circumstances occurring prior to the Closing
as a
result of the transactions contemplated by this Agreement) shall have been
satisfied.
7.6 No
Injunctions or Other Legal Restraints.
No
applicable Law, injunction or other legal restraint or prohibition enacted,
entered, promulgated, enforced or issued by any Governmental Authority
preventing, restricting or enjoining the consummation of the Closing or all
or
any portion of the transactions contemplated hereby shall be in
effect.
71
7.7 Related
Agreements.
The
form and substance of each Related Agreement (to the extent not attached as
an
Exhibit hereto) shall have been mutually agreed upon by the Purchaser and the
Sellers, and the Purchaser shall have received from each Seller a duly executed
copy of each Related Agreement to which such Person is a party.
7.8 Contractual
Consents.
Any
Consents required to assign any Purchased Contracts with any of the Material
Suppliers or the Material Customers shall have been obtained and shall be in
form and substance reasonably satisfactory to the Purchaser.
7.9 Debt
Financing.
The
Debt Financing shall have been made available to the Purchaser on terms and
conditions no less favorable in the aggregate to the Purchaser than those set
forth in the Term Sheet and the Financeability Letter, as
applicable.
7.10 The
Designated Agreements.
The
applicable Sellers shall have entered into the Designated Agreements, in each
case in form and substance reasonably acceptable to the Purchaser.
7.11 Termination
of Contracts.
The
Contracts listed in Schedule 7.11
shall
have been terminated by the Sellers.
7.12 Business
Material Adverse Effect.
There
shall have been no changes, developments or events since the date of this
Agreement that have had or would reasonably be expected to have or result in
a
Business Material Adverse Effect.
7.13 Certificate
of Non-Foreign Status.
The
Purchaser shall have received from each Seller selling Assets that constitute
“United States real property interests,” as defined in section 897(c) of the
Code, a certificate of non-foreign status of such Seller that meets the
requirements of Treasury Regulation section 1.1445-2(b).
7.14 Resolution
of Matters Related to the UBOB Operations.
The
Purchaser shall have received from Chemtura either of the items set forth on
Schedule
7.14.
7.15 Asbestos
Abatement.
The
Sellers shall have repaired those areas characterized on the asbestos survey
from the Summer of 2006 as “needs repair or attention” and shall have delivered
to the Purchaser documentation that such repairs had been completed, which
documentation shall be reasonably satisfactory to the Purchaser.
7.16 Title
Commitments.
A
title
insurance commitment reasonably acceptable to the Purchaser with respect to
each
of the Geismar Facility and the Monochem Facility (the “Title
Commitments”)
shall
have been issued by an insurance company reasonably acceptable to the Purchaser
pursuant to which such insurance company agrees that upon passage of the
applicable Act of Cash Sale to the Purchaser, payment of the premium therefor
(such premium to be paid 50% by the Purchaser and 50% by the Sellers at the
Closing) and satisfaction of other standard conditions such insurance company
shall issue the applicable owner and lender title insurance policies in standard
ALTA form, each such set of policies to be in an amount equal to not less than
the fair market value of the Geismar Facility or Monochem Facility, as
applicable, determined as of the Closing Date, containing only such exceptions
to title as are reasonably acceptable to the Purchaser with reasonable zoning
and other endorsements, and copies of any Liens referenced therein that had
not
been previously made available to the Purchaser by the Sellers shall have been
delivered to the Purchaser.
72
7.17 Surveys.
A
survey of each of the Geismar Facility and the Monochem Facility that satisfies
the requirements set forth in Exhibit M
shall
have been delivered to the Purchaser and the applicable insurance company
contemplated in Section 7.16
at least
15 Business Days prior to the Closing Date, with the cost of such surveys to
be
paid 50% by the Purchaser and 50% by the Sellers.
7.18 Estimated
Working Capital Amount.
The
Estimated Working Capital Amount shall be (a) no less than an amount equal
to
(i) the Net Working Capital Threshold Amount, less
(ii)
$5,000,000, and (b) no more than an amount equal to (i) the Net Working Capital
Threshold Amount, plus
(ii)
$5,000,000.
7.19 Effect
on EBITDA of the Business.
No
event, occurrence or circumstance shall have occurred since September 30, 2006
that has had or would reasonably be expected to have an adverse affect on net
recurring EBITDA of the Business by more than $1,000,000 annually or that has
had or would reasonably be expected to have a net adverse effect of more than
$2,000,000 on the Business.
7.20 Permits.
The
Sellers shall have provided the Purchaser, not less than five Business
Days prior to the Closing, with a schedule of the Permits that are scheduled
to
expire within the three-month period following the Closing.
7.21 Chinese
Joint Venture.
Chemtura shall hold 100% of the equity interest in the Chinese Joint Venture
free and clear of all Liens and shall have obtained the necessary Chinese
Consents to acquire the 10% equity interest in the Chinese Joint Venture from
China National Chemical Construction Jiangsu Company, and there shall be no
existing Contracts (other than this Agreement) relating to the issuance, sale
or
transfer of any equity interest in the Chinese Joint Venture.
7.22 Intellectual
Property Rights Actions.
The
Purchaser shall have received from the Sellers an updated Schedule
6.21
that
sets forth a true and complete list of all actions that, to the Sellers’
Knowledge, must be taken within six months following the Closing Date to
maintain the existence or validity of the Registered Intellectual
Property.
7.23 Replacement
Capital Analysis.
The
Purchaser shall have received from the Sellers a replacement capital analysis
of
the fixed assets located at the Geismar Facility, the scope of which analysis
shall have been that which is customary in the industry for such fixed
assets.
ARTICLE
8.
CONDITIONS
PRECEDENT TO OBLIGATIONS OF THE SELLERS
The
obligations each Seller to consummate the transactions contemplated by this
Agreement are subject to the satisfaction or waiver by such Seller of the
following conditions precedent on or before the Closing Date:
73
8.1 Representations
and Warranties True.
The
representations and warranties of the Purchaser contained herein shall have
been
accurate, true and correct in all material respects on and as of the date
hereof
and, except to the extent that any such representation or warranty is expressly
made solely as of the date hereof or as of another date earlier than the
Closing
Date, shall also be accurate, true and correct in all material respects on
and
as of the Closing Date.
8.2 Compliance
with Agreements and Covenants.
The
Purchaser shall have in all material respects performed and complied with all
of
its covenants and agreements contained in this Agreement to be performed and
complied with by it on or prior to the Closing.
8.3 Certificate
of Compliance.
The
Purchaser shall have delivered to the Sellers a certificate of the Purchaser
dated as of the Closing Date, executed by the Purchaser, certifying as to the
satisfaction of the conditions set forth in Sections 8.1
and
8.2.
8.4 HSR
Act; Premerger Notification Provisions; Brazil.
(a) Any
applicable waiting period under the HSR Act shall have expired or have been
terminated without action by the Antitrust Division or the FTC to prevent
consummation of the transactions contemplated hereby, (b) any waiting
period or suspensory obligation under any Premerger Notification Provision
shall
have expired or been terminated, (c) all applicable filings, consents and
approvals under any Premerger Notification Provision, the absence of which
would
prohibit the consummation of the transactions contemplated by this Agreement,
shall have been made or obtained and (d) the notification of this Agreement
shall have been made in Brazil to the Ministry of Justice of Brazil no later
than the 15th business day after the date of execution and delivery of this
Agreement.
8.5 No
Injunctions or Other Legal Restraints.
No
applicable Law, injunction or other legal restraint or prohibition enacted,
entered, promulgated, enforced or issued by any Governmental Authority
preventing the consummation of the Closing or all or any portion of the
transactions contemplated hereby shall be in effect.
8.6 Related
Agreements.
The
form and substance of each Related Agreement (to the extent not attached as
an
Exhibit hereto) shall have been mutually agreed upon by the Purchaser and the
Sellers, and the Sellers shall have received from the Purchaser a duly executed
copy of each Related Agreement to which the Purchaser is a party.
8.7 Consents.
Chemtura shall have received all Consents required under the Receivables
Securitization Agreements (including, where necessary, Consents of the
applicable Persons to the repurchase by Chemtura of Accounts Receivable) for
the
consummation of the transactions contemplated by this Agreement from the
applicable parties thereto and the release of all Liens in respect of any and
all of the Assets subject to any Lien thereunder.
ARTICLE
9.
CLOSING
9.1 Closing.
Subject
to Articles
7
and
8,
the
Closing shall take place at the offices of Mayer, Brown, Xxxx & Maw
LLP, 0000
Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000 at 10:00 a.m. (eastern time) on the second
Business Day after all the conditions set forth in Articles
7
and
8
(other
than conditions to be satisfied only by the delivery of certificates, or other
documents at the Closing, which shall be satisfied or waived at the Closing)
have been satisfied (or, to the extent permitted, waived by the parties entitled
to the benefits thereof); provided
that, at
Chemtura’s or the Purchaser’s election, the Closing shall be deferred until the
first day of the month following the month in which the Closing would otherwise
occur. Once the Closing occurs, the Closing, and all transactions to occur
at
the Closing, shall be deemed to have taken place at, and shall be effective
as
of, 12:00:01 a.m. (eastern time) on the Closing Date.
74
9.2 Deliveries
by the Sellers.
At the
Closing, each Seller (as applicable) shall deliver to the Purchaser the
following:
(a) the
Acts
of Cash Sale duly executed by the applicable Sellers;
(b) the
Accounts Receivable Note duly executed by Chemtura;
(c) the
Assignment and Assumption Agreement duly executed by each Seller;
(d) the
Xxxx
of Sale duly executed by each Seller;
(e) the
Chemtura Master Supply Agreement duly executed by Chemtura;
(f) if
determined by the parties to be necessary, the Foreign Implementation
Agreements, duly executed by the applicable Seller(s);
(g) the
Ground Lease duly executed by Chemtura;
(h) the
License Agreements duly executed by the applicable Seller(s);
(i) the
Patent Assignment duly executed by the Sellers;
(j) the
Purchaser Master Supply Agreement duly executed by Chemtura;
(k) the
Trademark Assignment duly executed by the Sellers;
(l) the
Transition Services Agreement duly executed by Chemtura;
(m) the
certificates described in Section 7.3;
(n) the
FIRPTA certificates described in Section 7.13;
(o) UCC-3
amendments, assigning to the Purchaser any UCC-1s in favor of any Seller with
respect to any consignment agreements that constitute Assets;
(p) title
certificates to any owned motor vehicles included in the Purchased Assets,
duly
executed by the applicable Seller;
(q) an
opinion of in-house counsel to the Sellers as to the matters set forth in
Exhibit
N;
(r) the
title
insurance policies referred to in Section
7.16;
75
(s) the
updated schedule described in Section
7.22;
(t) duly
executed instruments of conveyance sufficient to validly transfer all of the
equity interests in the Chinese Joint Venture, duly endorsed in blank for
transfer;
(u) resignations,
effective as of the Closing Date, of the directors designated by Chemtura to
the
board of directors of the Chinese Joint Venture;
(v) releases
and terminations of any Liens on the Assets that are not Permitted
Liens;
(w) the
Closing Proration Amount, if payable by the Sellers pursuant to Section 2.7;
and
(x) a
certificate of the secretary or an assistant secretary of each Seller certifying
resolutions of the board of directors (or similar governing body) of such
Seller, approving and authorizing the execution, delivery and performance by
such Seller of this Agreement and its respective Related Agreements and the
consummation by such Seller of the transactions contemplated hereby and thereby,
provided
that
such resolutions are required as a matter of Law or under such Seller’s
governing documents (together with an incumbency and signature certificate
regarding the officer(s) signing on behalf of such Seller).
9.3 Deliveries
by the Purchaser.
At the
Closing, the Purchaser shall deliver to the Sellers the following:
(a) the
Assignment and Assumption Agreement duly executed by the Purchaser;
(b) the
Xxxx
of Sale duly executed by the Purchaser;
(c) the
Chemtura Master Supply Agreement duly executed by the Purchaser;
(d) if
determined by the parties to be necessary, the Foreign Implementation
Agreements, duly executed by the Purchaser (or its designated
Affiliate(s));
(e) the
Ground Lease duly executed by the Purchaser;
(f) the
License Agreements duly executed by the Purchaser;
(g) the
Purchaser Master Supply Agreement duly executed by the Purchaser;
(h) the
Transition Services Agreement duly executed by the Purchaser;
(i) the
Closing Proration Amount, if payable by the Purchaser pursuant to Section 2.7;
(j) the
Accounts Payable Note, duly issued by the Purchaser;
76
(k) the
certificate described in Section 8.3;
(l) a
certificate of the secretary or an assistant secretary of the Purchaser
certifying resolutions of the board of directors of the Purchaser approving
and
authorizing the execution, delivery and performance by the Purchaser of this
Agreement and its Related Agreements and the consummation by the Purchaser
of
the transactions contemplated hereby and thereby (together with an incumbency
and signature certificate regarding the officer(s) signing on behalf of the
Purchaser); and
(m) the
Initial Purchase Price in accordance with Sections 3.1,
3.2(a),
(b)
and
(c)(i)
(if
applicable) and 13.4.
ARTICLE
10.
TERMINATION
10.1 Termination.
This
Agreement may be terminated, and the transactions contemplated herein may be
abandoned, at any time on or prior to the Closing:
(a) with
the
mutual written consent of the Sellers and the Purchaser;
(b) by
either
the Sellers or the Purchaser, if the Closing shall not have taken place on
or
prior to June 1, 2007; provided
that the
right to terminate this Agreement under this Section 10.1(b)
shall
not be available to (i) the Sellers if the failure of any Seller to fulfill
any
of its obligations under this Agreement caused the failure of the Closing to
occur on or prior to such date or (ii) the Purchaser if the failure of the
Purchaser to fulfill any of its obligations under this Agreement caused the
failure of the Closing to occur on or prior to such date;
(c) by
either
the Sellers or the Purchaser, if Chemtura and the Purchaser shall not have
agreed to the forms of the Chemtura Master Supply Agreement, the Ground Lease,
the License Agreements (other than the Chinese Trademark License Agreement)
and
the Transition Services Agreement on or prior to March 1, 2007; provided,
that
the right to terminate this Agreement under this Section 10.1(c)
shall
not be available to (i) the Sellers if the failure of any Seller to fulfill
any of its obligations under this Agreement caused the failure to reach such
agreement to the forms of such Related Agreements or (ii) the Purchaser if
the failure of the Purchaser to fulfill any of its obligations under this
Agreement caused the failure to reach such agreement to the forms of such
Related Agreements;
(d) by
the
Purchaser, if there shall have been a material breach of any representation
or
warranty of the Sellers hereunder which breach of such representation or
warranty would reasonably be expected to have a Business Material Adverse
Effect, or a material breach of any covenant or agreement of any Seller
hereunder, and in each case such breach shall not have been remedied within
30
days after receipt by the Sellers of a notice in writing from the Purchaser
specifying the breach and requesting such breach be remedied;
77
(e) by
the
Sellers, if there shall have been a material breach of any representation or
warranty of the Purchaser hereunder, or a material breach of any covenant or
agreement of the Purchaser hereunder, and such breach shall not have been
remedied within 30 days after receipt by the Purchaser of notice in writing
from
the Sellers specifying the breach and requesting such breach be remedied;
or
(f) by
either
Purchaser or the Sellers if, but only to the extent: (i) there shall be any
Law
or regulation that makes the consummation of all of the transactions
contemplated by this Agreement, finally and irrevocably illegal or otherwise
prohibited or that prohibits the Business as a whole, immediately after the
Closing, from being conducted as it is presently being conducted; or (ii)
consummation of all of the transactions contemplated by this Agreement or the
operation of the Business as a whole, immediately after the Closing, would
violate any nonappealable final judgment of any Governmental Authority having
competent jurisdiction.
In
the
event of termination by the Sellers or the Purchaser pursuant to this
Section 10.1
(other
than Section 10.1(a)),
written notice thereof shall be given to the other parties hereto.
10.2 Effect
of Termination.
If this
Agreement is terminated pursuant to Section 10.1,
all
obligations of the parties hereunder shall terminate, except for the obligations
set forth in Sections 6.5
(Brokers), 6.8
(Confidentiality), 13.1
(Expenses) and 13.8
(Publicity), each of which shall survive the termination of this Agreement,
and
except that no such termination shall relieve any party from any Liability
which
such party may have to another party for Losses arising out of any
misrepresentation or breach of this Agreement by such party which occurs on
or
before termination hereof.
ARTICLE
11.
EMPLOYEES
AND EMPLOYEE BENEFITS
11.1 Offers
of Employment.
On or
prior to the Closing Date and effective as of and conditioned upon the Closing,
the Purchaser shall make offers of employment to each of the Business Employees
other than (a) the Non-U.S. Employees and (b) the individuals set
forth on Schedule 11.1(a)
(“Offered
Employees”)
at the
same seniority level and base salary and/or base wages applicable to such
Offered Employees immediately prior to the Closing and on such other terms
and
conditions, including the terms of employee benefit plans, programs, policies
and arrangements that are substantially similar in the aggregate to the terms
and conditions provided by the Sellers and their Affiliates to such Offered
Employees immediately prior to the Closing and on such other terms and
conditions as determined by the Purchaser (the “Offers
of Employment”);
provided,
however,
that
the Purchaser shall not be required to implement or maintain any retention
pay
program or arrangement other than a program to effectuate the retention payments
to the individuals and in the amounts set forth on Schedule
11.5.
Each
such individual who accepts the Purchaser’s Offer of Employment shall become an
employee of the Purchaser as of the Closing and shall be referred to herein
as a
“Transferred
Employee.”
Such
Transferred Employees shall not have a guarantee of employment for any specific
duration, and shall be considered at-will. The
Sellers acknowledge that Offers of Employment made by the Purchaser in
accordance with this Section 11.1
shall
satisfy the Purchaser’s obligations under this Section
11.1
including with respect to the individuals listed on Schedule
11.1(b).
The
Offers of Employment shall be made in compliance with all applicable
Laws.
78
11.2 Vesting
and Service Credit.
To the
extent applicable with respect to employee benefit plans, programs and
arrangements that are established or maintained by the Purchaser for the benefit
of Transferred Employees, Transferred Employees (and their eligible dependents)
shall be given credit for their service with the Sellers and their Affiliates
(a) for purposes of vesting and eligibility under the retirement plan of the
Purchaser that satisfies the requirements of section 401(a) of the Code,
(b) for purposes of the Purchaser’s vacation plan and severance plan, (c) for
purposes of eligibility requirements under the Purchaser’s welfare plans, and
(d) for purposes of satisfying any waiting periods, evidence of insurability
requirements, or the application of any pre-existing condition limitations
and
shall be given credit for amounts paid under a corresponding Seller Plan during
the same period for purposes of applying deductibles, copayments and
out-of-pocket maximums as though such amounts had been paid in accordance with
the terms and conditions of the plans and arrangements maintained by the
Purchaser. Notwithstanding the foregoing provisions of this Section 11.2,
service
and other amounts shall not be credited to Transferred Employees (or their
eligible dependents) to the extent the crediting of such service or other
amounts would result in a duplication of benefits.
11.3 Non-U.S.
Employees.
Notwithstanding the provisions of Section 11.1,
no
later than February 23, 2007, the Purchaser shall notify the Sellers of each
Non-U.S. Employee (other than the employees covered by Exhibit
China
or the
UK Employees) to whom the Purchaser shall make an offer of employment effective
as of the Closing Date. Each such offer of employment shall comply in all
respects with the requirements of applicable local Law and the Sellers and
the
Purchaser agree to take any actions necessary to effect the transfers of
employment of such employees from the Sellers to the Purchaser and to agree
upon
the terms and conditions of such transfers and other matters relating to such
transfers, which terms and conditions may be set forth in an Employee Exhibit
that will form a part of this Agreement and supersede any provisions of this
Agreement that are inconsistent with any such Employee Exhibit; provided,
however,
that
the Purchaser shall not be obligated to make an offer of employment to any
Non-U.S. Employee (other than the employees covered by Exhibit
China
or the
UK Employees) unless and until the Sellers and the Purchaser have agreed to
an
Employee Exhibit with respect to such Non-U.S. Employee.
11.4 Severance
Costs.
(a) The
Sellers agree to reimburse the Purchaser for severance costs for terminations
up
to 27 technician positions and five salaried positions of Transferred Employees
(reduced by the number of terminations of employment in such categories made
by
the Sellers prior to the Closing Date) in the event that the termination occurs
because the Purchaser stops producing the products set forth on Schedule
11.4
or any
of the products to be supplied to Chemtura under the Purchaser Master Supply
Agreement at the Geismar Facility within four months after the Closing Date.
The
Sellers shall have no obligation to reimburse the Purchasers for any amounts
with respect to any individual pursuant to this Section
11.4(a)
unless,
prior to such individual’s termination, (i) the Purchaser has used commercially
reasonable efforts, as determined in good faith by the Purchaser, to offer
employment to such individual at the Geismar Facility or the Purchaser’s Baton
Rouge facility on terms and conditions that are no less favorable than those
offered to such individual pursuant to Section
11.1,
(ii)
after the exercise of such commercially reasonable efforts, the Purchaser is
unable to employ such individual, and (iii) to the extent a release would be
required under the applicable Chemtura Corporation Severance Plan, the
individual signs a release substantially comparable to the form of release
the
Sellers have historically required under the applicable Chemtura Corporation
Severance Plan, releasing the applicable Seller and its Affiliates and the
Purchaser and its Affiliates from any liability or claims arising out of such
individual’s employment with the applicable Seller or the Purchaser or the
termination or transfer thereof. Notwithstanding the foregoing, no reimbursement
obligation will arise under this Section
11.4(a)
with
respect to any individual who continues to be employed by the Purchaser, and
the
Purchaser shall refund the Sellers any reimbursements made under this
Section
11.4(a)
with
respect to any individual who becomes reemployed by Purchaser or any of its
Affiliates or otherwise performs services in any capacity for the Purchaser
or
any of its Affiliates (whether as a consultant, independent contractor, advisor
or otherwise), other than the performance of consulting services for a period
of
time not to exceed three months, within a 24-month period following the Closing
Date.
79
(b) In
the
event that (i) any Business Employee (other than a Transferred Employee) or
(ii)
any individual who would have otherwise been considered a Business Employee
but
for the termination of such individual as contemplated by Section
11.4(a)
prior to
the Closing (and provided that the Sellers have made the Purchaser aware of
the
identity of such individuals prior to the Closing) becomes an employee of the
Purchaser or any of its Affiliates or otherwise performs services in any
capacity for the Purchaser or any of its Affiliates (whether as a consultant,
independent contract, advisor or otherwise) within the 24-month period following
the Closing Date, and if such Business Employee received severance payments
from
the Sellers in connection with his or her termination of employment from the
Sellers, the Purchaser shall reimburse the Sellers for any and all such
severance costs; provided,
however,
that no
reimbursement obligation will arise under this Section 11.4(b)
with
respect to any Business Employee who performs consulting services for the
Purchaser or any of its Affiliates for a period of time not to exceed three
months during such 24-month period. The Purchaser shall promptly inform the
Sellers of any event that would entitle the Sellers to reimbursement pursuant
to
this Section
11.4.
11.5 Retention
Payments.
The
Sellers have agreed to provide retention payments to the individuals and in
the
amounts set forth on Schedule
11.5
pursuant
to the terms of the retention agreements set forth on Schedule
4.17(a).
The
Purchaser agrees to pay such amounts in accordance with their terms and
applicable Law and (i) the Sellers shall reimburse the Purchaser for
one-half of the total amounts so paid to the affected individuals until the
amount paid in connection with this Section
11.5,
net of
such reimbursements by the Sellers, has reached $130,000 and then (ii) the
Sellers shall reimburse the Purchaser for all of the total amounts so paid
to
the affected individuals.
11.6 No
Third Party Beneficiaries.
No
provision of this Article
11
or any
Employee Exhibit shall create any third party beneficiary or other rights in
any
Person (including any Transferred Employee or any beneficiary or dependent
thereof) in respect of continued employment (or resumed employment) with either
the Purchaser or any of its Affiliates and no provision of this Article
11
or any
Employee Exhibit shall create any such rights in any such Persons in respect
of
any benefits that may be provided, directly or indirectly, under any Seller
Plan
or any similar plan maintained by the Purchaser.
80
11.7 UK
Employees and Other Non-U.S. Employee Matters.
(a) The
Sellers (on behalf of themselves and their Affiliates) and the Purchaser
acknowledge that it is intended that EC Directive No. 2001/23, dated March
12,
2001, and domestic legislation implementing this directive into the national
law
of any country (collectively, the “Acquired
Rights Directive”)
shall
apply to the transfer of the employment of those employees of the Sellers or
their Affiliates who are wholly or mainly employed or engaged in the Business
as
of the Closing Date in the United Kingdom (the “UK
Employees”)
from
the Sellers or their Affiliates to the Purchaser, which employees are listed
on
Schedule
11.7
(which
the Sellers represent as being true and accurate as of the date hereof). The
Sellers (on behalf of themselves and their Affiliates) and the Purchaser further
acknowledge that, in accordance with the Acquired Rights Directive, the
employment of all the UK Employees shall transfer with effect from the Closing
Date to the Purchaser and that each of the parties shall comply with their
respective obligations under the Acquired Rights Directive and the Sellers
shall
cause their Affiliates to comply with their obligations under the Acquired
Rights Directive. Schedule
11.7
lists
all Foreign Benefit Plans applicable to the UK Employees.
(b) Indemnification
by Sellers.
Subject
to Section
11.7(c),
the
Sellers shall indemnify the Purchaser against any Losses in connection with
(i)
any act or omission of the Sellers or their Affiliates prior to the Closing
Date
arising out of or relating to the employment of the UK Employees who transfer
to
the Purchaser under the Acquired Rights Directive; and (ii) any claim by a
recognized trade union, works council, staff association or other
representative, person or body, (whether elected or not) in respect of any
UK
Employee arising out of any failure on the part of the Sellers or their
Affiliates to comply with its legal obligations to such union, council,
association, representative body or person, unless such claim arose as a result
of the failure by the Purchaser to comply with its obligations under the
Acquired Rights Directive.
(c) Indemnification
by Purchaser.
The
Purchaser shall indemnify the Sellers against any Losses in connection with
(i)
any act or omission of the Purchaser before or after the Closing Date relating
to the employment or termination of the employment of any of the UK Employees;
(ii) any changes to the terms of employment of any of the UK Employees to their
detriment which are made, proposed or anticipated to take effect on or after
the
Closing Date; and (iii) any claim by a recognized trade union, works council,
staff association or other representative body or person (whether elected or
not) in respect of the UK Employees arising out of the Purchaser's failure
to
comply with its legal obligations under the Acquired Rights
Directive.
(d) Other
Non-U.S. Employee Matters.
Schedule
11.7
contains
a true and correct list of each Foreign Employee Benefit Plan applicable to
the
Non-U.S. Employees in the jurisdictions specified.
81
ARTICLE
12.
INDEMNIFICATION
12.1 Survival.
The
representations and warranties of the parties hereto contained herein shall
survive the Closing for a period of 15 months after the Closing, except that
(a)
the representations and warranties in Section 4.19
shall
survive the Closing until the Tax Statute of Limitations Date and (b) Title
and
Authorization Warranties shall survive indefinitely. The covenants and
agreements contained in this Agreement shall survive indefinitely, unless any
such covenant or agreement terminates on an earlier date by its terms. No party
hereto shall have any Liability with respect to claims first asserted with
respect to any such representation, warranty, covenant or agreement after the
survival period specified therefor in this Section 12.1.
In the
event written notice of any claim for indemnification hereunder shall have
been
given within the applicable survival period (and otherwise in accordance with
this Agreement), the representations, warranties, covenants or agreements that
are the subject of such indemnification claim shall survive (solely with respect
to the subject matter of such indemnification claim) until such time as such
claim is finally resolved in accordance with the terms hereof. If more than
one
survival period applies to a particular claim, the longest of such survival
periods shall be the controlling survival period for such claim.
12.2 Indemnification
by the Sellers.
Subject
to Section 12.2(g)
and
12.4,
the
Sellers, jointly and severally, agree to indemnify the Purchaser and its
Affiliates (each, a “Purchaser
Indemnified Party”)
against, and agree to hold the Purchaser Indemnified Parties harmless from,
any
and all Losses incurred or suffered by the Purchaser Indemnified Parties to
the
extent arising out of, resulting from or relating to any of the
following:
(a) any
breach of or any inaccuracy in any representation or warranty made by any Seller
in this Agreement or in any Related Agreement;
(b) any
breach of or failure by any Seller to perform any covenant or agreement of
such
Seller set out in this Agreement or any Related Agreement;
(c) any
Excluded Asset;
(d) any
Retained Obligation;
(e) any
liability for Taxes with respect to the Chinese Joint Venture attributable
to
any Pre-Closing Tax Period or the portion of any Straddle Period ending on
the
day immediately preceding the Closing Date (determined in accordance with
Section 6.10(b))
in
excess of the amount reserved for such Tax liability as reflected in the Closing
Statement;
(f) any
noncompliance by any Seller with any Bulk Sales Laws or fraudulent transfer
Law
in respect of any of the transactions contemplated hereunder; or
82
(g) Notwithstanding
any provision of this Agreement to the contrary, (i) the sole and exclusive
remedy of any Purchaser Indemnified Party with respect to any Losses arising
out
of or relating to any capital expenditures that may be necessary (A) to
resolve or xxxxx Environmental Violations or matters of non-compliance with
Environmental Law or (B) to restore the Business to compliance therewith
shall be a claim for indemnification under Section
12.2(a)
for a
breach of the representations or warranties set forth in Section
4.21,
which
claim must be brought no later than the one year anniversary of the Closing
Date, and no such claims may be brought by any Purchaser Indemnified Party
under
Section
12.9
or any
other subparagraph of Section
12.2;
and
(ii) with respect to any Environmental Violation or matter of
non-compliance with Environmental Law existing as of the Closing and continuing
uninterrupted following the Closing that is (A) discovered by the Purchaser
during the first year after the Closing Date, the sole and exclusive remedy
of
the Purchaser Indemnified Parties with
respect to the period subsequent to the Closing (other
than with respect to capital expenditures contemplated by clause
(i)
above)
shall be recovery from the Sellers of any fines and penalties associated with
such Environmental Violation or matter of non-compliance with Environmental
Law
incurred during the first year following the Closing, together with all
reasonable attorney’s fees and consulting fees to address such non-compliance,
or (B) discovered by the Purchaser after the first anniversary of the
Closing Date, the sole and exclusive remedy of the Purchaser Indemnified Parties
with respect to the period subsequent to the Closing shall be the costs of
defending any claim or fines or penalties attributable to the first year of
operation of the Business after the Closing.
For
the
avoidance of doubt (and other than as otherwise provided in Section
12.2(g)),
if a
state of facts would allow a Purchaser Indemnified Party to seek indemnification
under Section
12.2(a)
as well
as any other subparagraph of this Section
12.2
or
Section
12.9,
the
Purchaser Indemnified Party shall be entitled in its discretion to elect to
seek
indemnification under such other subparagraph or Section
12.9.
12.3 Indemnification
by the Purchaser.
The
Purchaser agrees to indemnify the Sellers and their Affiliates (each, a
“Seller
Indemnified Party”)
against, and agrees to hold the Seller Indemnified Parties harmless from, any
and all Losses incurred or suffered by the Seller Indemnified Parties to the
extent arising out of, resulting from or relating to any of the
following:
(a) any
breach of or any inaccuracy in any representation or warranty made by the
Purchaser in this Agreement or any Related Agreement;
(b) any
breach of or failure by the Purchaser to perform any covenant or agreement
of
the Purchaser set out in this Agreement or any Related Agreement;
(c) any
Assumed Obligation;
(d) the
ownership and operation of the Business, or the ownership, operation, use or
sale of the Assets, in each case from or after the Closing;
(e) any
Liability arising under any Business Guarantee; or
(f) any
and
all Environmental Claims, Environmental Violations or Environmental Liabilities
related to the Real Property constituting a part of the Assets or the operation
of the Business to the extent such Environmental Claims, Environmental
Violations or Environmental Liabilities are solely caused by post-Closing Date
actions, circumstances or occurrences.
83
12.4 Limitations
on Liability.
Notwithstanding any other provision of this Agreement or any Related Agreement
or any right or remedy available under any Law except insofar as is provided
in
Section 12.9:
(a) The
Purchaser Indemnified Parties shall have the right to payment by the Sellers
under Section 12.2(a)
if, and
then only to the extent that (after taking into account the other provisions
of
this Article
12),
the
Purchaser Indemnified Parties shall have incurred indemnifiable Losses totaling
$1,350,000 and then only with respect to indemnifiable Losses that exceed
$10,000 from the first dollar of each such Loss (provided that a series of
similar events, claims or items of Loss or damage can be aggregated together
for
purposes of this Section 12.4(a)
and in
particular for purposes of reaching such $10,000 threshold)); provided,
however,
that
the limitations in this Section 12.4(a)
shall
not apply to claims or Losses arising from breaches of the Title and
Authorization Warranties.
(b) The
Sellers shall have no Liability under or otherwise in connection with this
Agreement or the Related Agreements or the transactions contemplated hereby
or
thereby in excess of 18% of the Purchase Price in the aggregate, except that
(i)
such limitation shall not apply to indemnifiable Losses (1) under Sections 12.2(b),
(c),
(d),
(e),
(f)
or
(g),
and (2)
indemnifiable Losses arising from breaches of the Title and Authorization
Warranties, in each such case for which there shall be no limit, and (ii) any
indemnifiable Losses (1) under Sections 12.2(b),
(c),
(d),
(e),
(f)
or
(g),
and (2)
arising from breaches of the Title and Authorization Warranties, shall not
be
applied towards such limit. For the avoidance of doubt, this Section 12.4(b)
does not
apply to the Sellers’ Liability under Section 12.9
and
amounts payable by the Sellers under Section 12.9
do not
apply to the limit set forth in this Section 12.4(b).
(c) Except
for any claims seeking equitable relief in connection with the failure of any
party to perform its covenants or agreements hereunder or claims arising from
fraud or willful misconduct, from and after the Closing, the provisions of
Article
3
and the
indemnification provisions set forth in this Article
12
and in
Sections 6.5
and
11.7
shall be
the exclusive remedies of the parties hereto and their respective Affiliates
with respect to any and all claims in respect of the subject matter of this
Agreement or any Related Agreement or the transactions contemplated hereby
or
thereby (including for any breach of or inaccuracy in any representation or
warranty or any non-compliance with or breach of or default in the performance
of any of the covenants or agreements contained in this Agreement) and the
parties shall not be entitled to any further indemnification, contribution,
recovery or other rights or claims of any nature whatsoever in respect thereof
(whether under this Agreement or any Related Agreement or under any common
law
theory or any statute or other Law, including any Environmental Law, or
otherwise), all of which the parties hereto hereby waive.
(d) Neither
the Sellers nor any of their Affiliates shall have any Liability under or
otherwise in connection with this Agreement or the Related Agreements or the
transactions contemplated hereby or thereby for any Loss to the extent arising
from a change in Law that becomes effective after the Closing. Notwithstanding
anything to the contrary in this Agreement, as to Losses under this Agreement
and any Related Agreement that are not Losses related to a Third Party Claim,
such Losses shall exclude special, incidental, punitive, exemplary and
consequential damages and lost profits.
84
12.5 Claims.
As
promptly as is reasonably practicable after becoming aware of a claim for
indemnification under this Agreement not involving a Third Party Claim, but
in
any event no later than 15 Business Days after first becoming aware of such
claim, the Indemnified Person shall give written notice to the Indemnifying
Person of such claim in accordance herewith (the “Claim
Notice”);
provided,
that
the failure of the Indemnified Person to give such notice shall not relieve
the
Indemnifying Person of its obligations under this Article
12
except
to the extent (if any) that the Indemnifying Person shall have been actually
prejudiced thereby. The Claim Notice shall set forth in reasonable detail (i)
the facts and circumstances giving rise to such claim for indemnification,
including all relevant supporting documentation, (ii) the nature of the Losses
suffered or incurred or expected to be suffered or incurred, (iii) a reference
to the provisions of this Agreement, the Related Agreement or the certificate
or
instrument delivered in connection with this Agreement in respect of which
such
Losses have been suffered or incurred or are expected to be suffered or
incurred, (iv) the amount of Losses actually suffered or incurred and, to the
extent the Losses have not yet been suffered or incurred, a good faith estimate
of the amount of Losses that could be expected to be suffered or incurred,
and
(v) information as may be necessary for the Indemnifying Person to determine
that the limitations of Sections 12.4(a)
and
(b)
have
been satisfied or do not apply.
12.6 Notice
of Third Party Claims; Assumption of Defense.
The
Indemnified Person shall give a Claim Notice (in the form contemplated by
Section 12.5)
as
promptly as is reasonably practicable, but in any event no later than 10
Business Days after receiving notice thereof, to the Indemnifying Person of
the
assertion of any claim, or the commencement of any Proceeding, by any Person
not
a party hereto in respect of which indemnity may be sought under this Agreement
(a “Third
Party Claim”);
provided,
that
the failure of the Indemnified Person to give such notice shall not relieve
the
Indemnifying Person of its obligations under this Article
12
except
to the extent (if any) that the Indemnifying Person shall have been actually
prejudiced thereby. The Indemnifying Person may, at its own expense, (a)
participate in the defense of any such Third Party Claim and (b) upon notice
to
the Indemnified Person, at any time during the course of any such Third Party
Claim, assume the defense thereof with counsel of its own choice and in the
event of such assumption, shall have the exclusive right, subject to
clause
(a)
in the
proviso in Section 12.7,
to
settle or compromise such Third Party Claim. If the Indemnifying Person assumes
such defense, the Indemnified Person shall have the right (but not the duty)
to
participate in the defense thereof and to employ counsel, at its own expense,
separate from the counsel employed by the Indemnifying Person (subject to the
foregoing provisions of this Section 12.6).
If the
Indemnifying Party (i) shall fail to notify the Indemnified Party of its
intent to exercise its rights to defend any Third Party Claim within 30 days
after receipt of any Claim Notice with respect thereto or (ii) after commencing
or undertaking any such defense or settlement, fails to diligently pursue or
withdraws from such defense or settlement, the Indemnified Party shall have
the
right to undertake the defense or settlement thereof, at the Indemnifying
Party’s expense. The Indemnified Party shall not, however, settle any Third
Party Claim without the prior written consent of the Indemnifying Party (such
consent not to be unreasonably withheld), absent which all rights against the
Indemnifying Party for indemnification with respect to such Third Party Claim
shall terminate and be deemed waived. Whether or not the Indemnifying Person
chooses to defend or prosecute any such Third Party Claim, all of the parties
hereto shall cooperate in the defense or prosecution thereof.
85
12.7 Settlement
or Compromise.
Any
settlement or compromise made or caused to be made by the Indemnified Person
(unless the Indemnifying Person has the exclusive right to settle or compromise
under clause
(b)
of
Section 12.6)
or the
Indemnifying Person, as the case may be, of any such Third Party Claim shall
require the Indemnifying Person’s or the Indemnified Person’s prior written
consent (such consent not to be unreasonably withheld) and, if such consent
has
been given, shall be binding upon the Indemnifying Person or the Indemnified
Person, as the case may be, in the same manner as if a final judgment or decree
had been entered by a court of competent jurisdiction in the amount of such
settlement or compromise; provided,
that
the Indemnified Person shall consent to any settlement, compromise or discharge
of a Third Party Claim that the Indemnifying Person may recommend and that
by
its terms (a) does not provide for injunctive or other non-monetary relief
adversely affecting the Indemnified Person, (b) includes the giving by the
relevant claimant or plaintiff to the Indemnified Party of a full and
unconditional release from all liability with respect to such Third Party Claim,
and (c) does not require the Indemnified Party to contribute any moneys to
the
settlement, compromise or discharge of such Third Party Claim.
12.8 Mitigation;
Net Losses; Subrogation.
Except
with respect to any indemnification under Section 12.9
herein:
(a) Each
Indemnified Person shall use commercially reasonable efforts to mitigate any
Losses that such Indemnified Person asserts under this Article
12.
If an
Indemnified Person shall fail to make such commercially reasonable efforts
to
mitigate any such Losses, then, notwithstanding anything to the contrary
contained in this Agreement or any Related Agreement, no Indemnifying Person
shall be required to indemnify any Indemnified Person for that portion of any
Losses that could reasonably be expected to have been avoided if the Indemnified
Person had made such efforts.
(b) Notwithstanding
anything contained herein to the contrary, the amount of any Losses incurred
or
suffered by any Indemnified Person shall be calculated after giving effect
to
any recoveries obtained by the Indemnified Person (or any of its Affiliates)
from any other third party (including insurers) in respect of such Losses.
Each
Indemnified Person shall exercise commercially reasonable efforts to obtain
such
recoveries. If any such recoveries are received by an Indemnified Person (or
any
of its Affiliates) with respect to any Losses after an Indemnifying Person
has
made a payment to the Indemnified Person with respect thereto, the Indemnified
Person (or such Affiliate) shall promptly pay to the Indemnifying Person the
amount of such recoveries (up to the amount of the Indemnifying Person’s
payment).
(c) Upon
making any payment to an Indemnified Person in respect of any Losses, the
Indemnifying Person will, to the extent of such payment, be subrogated to all
rights of the Indemnified Person (and its Affiliates) against any third party
in
respect of the Losses to which such payment relates. Such Indemnified Person
(and its Affiliates) and Indemnifying Person will execute upon request all
instruments reasonably necessary to evidence or further perfect such subrogation
rights.
86
12.9 Environmental
Indemnification.
With
respect to any Environmental Claim or Environmental Liability for which
indemnification is sought pursuant to this Agreement by either the Purchaser
or
the Sellers, the provisions of this Section
12.9
set
forth the understandings of the parties therewith.
(a) Notwithstanding
any other provision of this Agreement to the contrary, except as provided in
Section
12.9(c),
the
Sellers are solely responsible for and shall defend, indemnify and hold harmless
the Purchaser, without regard to any limit on time or any dollar limit
whatsoever, against all Environmental Claims, Environmental Liabilities, or
Losses arising out of, related to, or based on:
(i) All
Known
Pre-Closing Environmental Liabilities;
(ii) All
of
Sellers’ Offsite Environmental Liabilities; and
(iii) Any
Releases of Hazardous Substances that were used by the Sellers or the Chinese
Joint Venture in their operations but that were never used by the Purchaser
or
any subsequent owner or operator;
provided,
however,
solely
with respect to the Geismar Response Action Costs, if the surrounding facts
and
circumstances show that such Environmental Claims, Environmental Liabilities
or
Losses were aggravated or worsened, in whole or in part, because of the actions
or omissions of the Purchaser or any Release of Hazardous Substances arising
out
of the Purchaser’s operations after the Closing, the Purchaser shall bear the
responsibility for assuming and defending, indemnifying and holding the Sellers
harmless against such Environmental Claims, Environmental Liabilities or Losses
but only to the extent of any increase in costs that are caused by such
aggravation or worsening; provided,
further,
that if
the Purchaser wishes to construct any additions or modifications to the Geismar
Facility (i) in the area of the Geismar Landfill or the Fire Pond Buried
Drum Area as identified in the Geismar Facility Phase II (the
“Restricted
Areas”)
and
such additions or modifications increase the Sellers’ indemnification
obligations under Section
12.9(a)(i)
or
(iii),
then
the Purchaser shall bear the responsibility for assuming and defending,
indemnifying and holding the Sellers harmless against such Environmental
Liabilities, Environmental Claims or Losses, but only to the extent of any
increase in costs that are caused by any aggravation or worsening arising from
such additions or modifications and (ii) in an area that is not a
Restricted Area but in which there is either Known Pre-Closing Environmental
Liabilities or Unknown Pre-Closing Environmental Liabilities, then, at the
Sellers’ option, (A) the Purchaser shall relocate the construction of such
addition or modification to another area of the Geismar Facility reasonably
acceptable to the Sellers, and the Sellers, on the one hand, and the Purchaser,
on the other hand, shall each bear 50% of the incremental capital costs of
such
relocation or (B) the Sellers may consent to such construction, in which
case the Sellers, on the one hand, and the Purchaser, on the other hand, shall
each bear 50% of any increase in costs that is caused by any aggravation or
worsening arising from such additions or modifications.
87
(b) Except
as
provided in Section
12.9(c),
the
Sellers are solely responsible for and shall defend, indemnify and hold harmless
the Purchaser, without regard to any limit on time or any dollar limit
whatsoever, against all Environmental Claims, Environmental Liabilities, or
Losses arising out of, related to, or based on all Unknown Pre-Closing
Environmental Liabilities, to the extent that they are presented to the Sellers
by the Purchaser within 15 years of the Closing Date; provided,
however,
solely
with respect to the Geismar Response Action Costs, if the surrounding facts
and
circumstances show that such Environmental Claims, Environmental Liabilities
or
Losses were aggravated or worsened, in whole or in part, because of the actions
or omissions of the Purchaser or any Release of Hazardous Substances arising
out
of the Purchaser’s operations after the Closing, the Purchaser shall bear the
responsibility for assuming and defending, indemnifying and holding the Sellers
harmless against such Environmental Claims, Environmental Liabilities or Losses
but only to the extent of any increase in costs that are caused by such
aggravation or worsening;
(c) The
Purchasers shall be solely responsible for and shall defend, indemnify and
hold
the Sellers harmless against:
(i) any
and
all Unknown Pre-Closing Environmental Liabilities that arise more than 15 years
after the Closing Date;
(ii) all
Geismar Response Action Costs arising solely out of the actions or omissions
of
the Purchaser in its operations after the Closing Date; and
(iii) other
than the Geismar Response Action Costs, all Environmental Liabilities,
Environmental Claims or Losses arising out of the actions or omissions of the
Purchaser in its operations after the Closing Date (for the avoidance of doubt,
to the extent any workers compensation claim or claim for personal injury or
property damage based on or arising out of exposure to Hazardous Substances
involves potential liability against both the Sellers and the Purchaser, then
the Environmental Liabilities, Environmental Claims or Losses related to the
same are to be divided between the Sellers, on the one hand, and the Purchaser,
on the other hand, according to their respective proportionate shares).
For
purposes of this Section
12.9(c),
the
“Purchaser” shall refer to the Purchaser or any subsequent owner or operator.
(d) The
Geismar Response Actions and any other actions to address matters that fall
within subsections (a),
(b)
and
(c)
above
shall be conducted as set forth on Schedule
12.9(a).
(e) Any
Environmental Claims that are asserted against the Sellers or the Purchaser
shall be governed by the provisions of Sections
12.5,
12.6
and
12.7
herein.
(f) For
the
avoidance of doubt and notwithstanding any other provision of this Agreement
or
any right or remedy available under any Law, and expressly waiving any statutory
and common law claims for indemnification or contribution, however arising,
the
Sellers and the Purchaser agree that the sole remedy of any of them (or any
of
their respective Affiliates) as to any claim with respect to those matters
falling within Section
12.9(a),
12.9(b)
or
12.9(c)
shall be
what is set forth in this Section
12.9
and the
associated Schedule.
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(g) Before
proceeding with any transfer to any third party of any of its responsibilities
or obligations under this Agreement with respect to any Known Pre-Closing
Environmental Liabilities or Unknown Pre-Closing Environmental Liabilities,
the
Sellers shall obtain the consent of the Purchaser, which consent shall not
be
unreasonably withheld.
12.10 Purchase
Price Adjustments.
To the
extent permitted by Law, any amounts payable under Section 12.2
or
12.3
shall be
treated by the Purchaser and the Sellers as an adjustment to the Purchase
Price.
ARTICLE
13.
MISCELLANEOUS
13.1 Expenses.
Except
as contemplated by Section 3.2(c)(iv),
3.4,
6.10(d),
7.16
or
7.17,
each
party hereto shall bear its own fees and expenses with respect to the
transactions contemplated hereby; provided,
however,
that
the Sellers, on the one hand, and the Purchaser, on the other hand, shall share
equally all filing fees associated with the filings required by Section 6.3(b).
13.2 Amendment.
Except
as provided in Section 13.17,
this
Agreement may be amended, modified or supplemented only in a writing signed
by
the Purchaser and the Sellers.
13.3 Notices.
Any
notice, request, instruction or other document to be given hereunder by a party
hereto shall be in writing and shall be deemed to have been given, (a) when
received if given in person or by courier or a courier service, or (b) on the
date of transmission if sent by facsimile transmission (receipt confirmed)
on a
Business Day during the normal business hours of the intended recipient, and
if
not so sent on such a day and at such a time, on the following Business
Day:
(i) If
to the
Purchaser, addressed as follows:
c/o
Lion
Chemical Capital, LLC
0000
Xxxxxxxxxxx Xxxxx, Xxxxx 000
Xxxxxxx,
Xxxxx 00000
Attention: Xxxxx
XxXxxxx
Facsimile: (000)
000-0000
with
a
copy to:
Xxxxxx
& Xxxxxx LLP
0000
Xxxxxxxxxxxx Xxxxxx X.X.
Xxxxx
000
Xxxxxxxxxx,
X.X. 00000-0000
Attention: Xxx
X.
Xxxxxx
Facsimile: (000)
000-0000
89
(ii) If
to any
Seller, addressed as follows:
x/x
Xxxxxxxx Xxxxxxxxxxx
Xxxxxx
Xxxx
Xxxxxxxxxx,
XX 00000
Attention: General
Counsel
Facsimile: (000)
000-0000
with
a
copy to:
Mayer,
Brown, Xxxx & Maw LLP
00
Xxxxx
Xxxxxx Xxxxx
Xxxxxxx,
XX 00000
Attention: Xxxxx
X.
Xxxxx and Xxxxxxxx X. Xxxxxxx
Facsimile: (000)
000-0000
or
to
such other individual or address as a party hereto may designate for itself
by
notice given as herein provided.
13.4 Payments
in Dollars.
Except
as otherwise provided herein or in a Related Agreement, all payments pursuant
hereto shall be made by wire transfer in United States dollars in same day
or
immediately available funds without any set-off, deduction or counterclaim
whatsoever.
13.5 Waivers.
Except
as otherwise provided in Article
12,
the
failure of a party hereto at any time or times to require performance of any
provision hereof or claim damages with respect thereto shall in no manner affect
its right at a later time to enforce the same. No waiver by a party of any
condition or of any breach of any representation, warranty, covenant or
agreement contained in this Agreement shall be effective unless in writing,
and
no waiver in any one or more instances shall be deemed to be a further or
continuing waiver of any such condition or breach in other instances or a waiver
of any other condition or breach of any other representation, warranty, covenant
or agreement.
13.6 Binding
Effect; Assignment.
(a) This
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and permitted assigns. Subject to paragraph
(c)
and
except as provided below, no assignment of this Agreement or any rights or
obligations hereunder (and, in the case of the Purchaser, no Proposed Transfer)
may be made by any party without the prior written consent of the other parties
(which consent shall not be unreasonably withheld, conditioned or delayed),
except that (i) prior to the Closing any party hereto may assign all or any
portion of its rights or obligations hereunder to an Affiliate of such party
(but no such assignment shall relieve the assigning party of its obligations
hereunder), and (ii) the Purchaser may collaterally assign its rights and
remedies hereunder (including its right, title and interest in and to any and
all sums due from any Seller pursuant hereto) to financial institutions that
are
to provide or are providing sources of financing in connection with the
acquisition of the Assets and/or their collateral or administrative
agent(s).
90
(b) If
the
Purchaser wishes to effect a Proposed Transfer, it shall deliver to Chemtura
a
written request for consent to such Proposed Transfer, which shall include
the
identity of the proposed transferee and the principals and management thereof
and such other information reasonably necessary to allow Chemtura to evaluate
the request (such as, if known, the individuals who will be operating the
acquired portion of the Business). Within 10 Business Days after receipt by
Chemtura of such written request, Chemtura shall notify the Purchaser in writing
if it elects to withhold its consent to the Proposed Transfer (including
Chemtura’s reasons therefor in reasonable detail). Chemtura shall be deemed to
have approved any Proposed Transfer if Chemtura fails to respond to the
Purchaser’s written request for consent within such 10 Business Day period, and
shall be deemed to have waived any right to object to such Proposed Transfer
hereunder. Chemtura acknowledges that the Purchaser may request consent to
a
Proposed Transfer prior to the negotiation of a definitive purchase and sale
agreement with respect to such Proposed Transfer. A “Proposed
Transfer”
shall
mean (i) a transfer or assignment (other than a collateral assignment of
the Purchaser’s rights and remedies hereunder as permitted pursuant to
Section
13.6(a))
of all
or substantially all of the EPDM Business, the Rubber Chemicals Business, the
Monochem Business or the Chinese Joint Venture, or any combination thereof
(whether by purchase of equity interests, purchase of assets, merger or other
form of transaction); or (ii) the issuance or transfer in one or a series
of transactions of any ownership interest in the Purchaser (directly or
indirectly) that results in a Person that does not currently own an interest
in
the Purchaser owning (directly or indirectly) 50% or more of the ownership
interest in the Purchaser.
(c) Chemtura
shall be deemed to have acted reasonably in withholding its consent to any
assignment of this Agreement or any rights or obligations hereunder by the
Purchaser or to any Proposed Transfer if (i) the proposed assignee or
transferee (or its principals or employees) has a history of demonstrating
significant deficiencies in operations or environmental compliance or
(ii) the assignment of this Agreement or any rights or obligations
hereunder is requested other than in connection with the sale of all or
substantially all of the EPDM Business, the Rubber Chemicals Business, the
Monochem Business or the Chinese Joint Venture, or any combination of them
(whether by purchase of equity interests, purchase of assets, merger or other
form of transaction). If Chemtura reasonably withholds its consent to a Proposed
Transfer and the Purchaser nevertheless effects such Proposed Transfer, the
Sellers’ indemnification obligations set forth in Article
12
shall
terminate with respect to any claims not yet asserted by the Purchaser
Indemnified Parties, and thereafter none of the Purchaser Indemnified Parties
nor any of the Purchaser’s successors or assigns shall have any further claims
against the Sellers for indemnifiable Losses pursuant to Article
12
(and the
Purchaser shall have irrevocably waived any such claim).
(d) In
connection with any permitted assignment of this Agreement or any rights or
obligations hereunder, the applicable assignee shall expressly assume the
obligations of the assigning party under this Agreement by execution of an
assignment and assumption agreement in form and substance reasonably
satisfactory to the non-assigning party. The restrictions on assignment and
transfer in this Section 13.6
shall
continue for each and every subsequent assignment of any entity’s interest in
this Agreement and any subsequent assignee or transferee of this Agreement
shall
notify any potential assignee or transferee of this obligation.
91
13.7 No
Third Party Beneficiaries.
This
Agreement is solely for the benefit of the parties hereto and, to the extent
expressly provided herein, their respective Affiliates, and no provision of
this
Agreement shall be deemed to confer upon any third party any remedy, claim,
Liability, reimbursement, cause of action or other right.
13.8 Publicity.
Each of
the parties agrees that it shall not disclose publicly the existence or terms
of
this Agreement or any of the Related Agreements or the transactions contemplated
hereby or thereby (or permit any of its Affiliates or representatives to make
any such public disclosure); provided,
however,
that
(a) a party (or its Affiliate) may, without the prior consent of any other
party, issue such public disclosure as may be required by applicable Law or
any
rule of any securities exchange or market to which the disclosing party is
subject and (b) the Purchaser shall be permitted to disclose this
Agreement, to the extent reasonably necessary and under terms of confidentiality
at least as restrictive as those contained in the Confidentiality Agreement,
to
any financial institution or lender or potential equity investor who is
investigating the provision of financing to or investment in the equity of
the
Purchaser. Without limiting the foregoing, each party shall (and shall cause
its
Affiliates and representatives to) consult with the others before issuing (or
before any of its Affiliates issues) any press release or public statement
with
respect to this Agreement or any of the Related Agreements or the transactions
contemplated hereby or thereby, and provide the others the reasonable
opportunity to review and offer comments upon such release or statement (which
need not be accepted by the issuing party or its Affiliate or
representative).
13.9 Further
Assurances.
In case
at any time after the Closing any further action is necessary or desirable
to
carry out the purposes of this Agreement, the Sellers and the Purchaser will
take such further action (including the execution and delivery of such further
instruments and documents) as any other party reasonably may request, all at
the
sole cost and expense of the requesting party (unless the requesting party
is
entitled to indemnification therefor under Article 12).
13.10 Severability.
If any
provision of this Agreement shall be held invalid, illegal or unenforceable,
the
validity, legality or enforceability of the other provisions hereof shall not
be
affected thereby, and there shall be deemed substituted for the provision at
issue a valid, legal and enforceable provision as similar as possible to the
provision at issue.
13.11 Entire
Understanding.
This
Agreement, the Related Agreements, the SAP Letter Agreement and the
Confidentiality Agreement set forth the entire agreement and understanding
of
the parties hereto with respect to the transactions contemplated hereby and
thereby and supersede any and all prior agreements, arrangements and
understandings among the parties relating to the subject matter
hereof.
92
13.12 Language.
The
Sellers and the Purchaser agree that the language used in this Agreement is
the
language chosen by the parties to express their mutual intent, and that no
rule
of strict construction is to be applied against any Seller or the Purchaser.
Each of the Sellers and the Purchaser and their respective counsel have reviewed
and negotiated the terms of this Agreement.
13.13 Applicable
Law.
This
Agreement shall be governed by and construed and enforced in accordance with
the
internal laws of the State of New York.
13.14 Remittances.
All
remittances, payments, mail and other communications relating to the Assets
or
the Assumed Obligations received by any Seller at any time after the Closing
Date shall be promptly turned over to the Purchaser by such Seller. All
remittances, payments, mail and other communications relating to the Excluded
Assets or the Retained Obligations received by the Purchaser at any time after
the Closing Date shall be promptly turned over to the applicable Seller by
the
Purchaser.
13.15 Bulk
Sales.
The
Purchaser hereby waives compliance by the Sellers with the provisions of the
Laws of any jurisdiction relating to a bulk sale or transfer of assets that
may
be applicable to the transfer of the Assets.
13.16 Jurisdiction
of Disputes; Waiver of Jury Trial.
Each
party to this Agreement hereby (a) agrees that any Proceeding in connection
with
or relating to this Agreement, any Related Agreement or any matters contemplated
hereby or thereby, shall be brought by any party solely in a court of competent
jurisdiction located within the County of New York, in the State of New York,
whether a state or federal court; (b) agrees that in connection with any such
Proceeding or action, it will consent and submit to personal jurisdiction in
any
such court described in clause
(a)
of this
Section 13.16
and to
service of process upon it in accordance with the rules and statutes governing
service of process; (c) agrees to waive to the full extent permitted by Law
any
objection that it may now or hereafter have to the venue of any such Proceeding
in any such court or that any such Proceeding was brought in an inconvenient
forum; (d) designates, appoints and directs CT Corporation System as its
authorized agent to receive on its behalf service of any and all process and
documents in any such litigation, proceeding or action in the County of New
York, in the State of New York; (e) agrees to notify the other parties to this
Agreement immediately if such agent shall refuse to act, or be prevented from
acting, as agent and, in such event, promptly to designate another agent in
the
County of New York, in the State of New York to serve in place of such agent
and
deliver to the other parties written evidence of such substitute agent’s
acceptance of such designation; (f) agrees as an alternative method of service
to service of process in any such litigation, proceeding or action by mailing
of
copies thereof to it at its address set forth in Section 13.3;
(g)
agrees that any service made as provided herein shall be effective and binding
service in every respect; and (h) agrees that nothing herein shall affect the
rights of any party to effect service of process in any other manner permitted
by Law. EACH PARTY HERETO IRREVOCABLY AND ABSOLUTELY WAIVES THE RIGHT TO A
TRIAL
BY JURY IN ANY DISPUTE IN CONNECTION WITH, ARISING UNDER OR RELATING TO THIS
AGREEMENT, ANY RELATED AGREEMENT OR ANY MATTERS CONTEMPLATED HEREBY OR THEREBY,
AND AGREES TO TAKE ANY AND ALL ACTION NECESSARY OR APPROPRIATE TO EFFECT SUCH
WAIVER.
93
13.17 Schedules;
Communication.
(a) Any
information disclosed pursuant to any Schedule hereto shall be deemed to be
disclosed to the Purchaser for all purposes of this Agreement and the Related
Agreements to the extent the relationship of such matter to such other Schedule
is reasonably apparent on its face. Neither the specification of any Dollar
amount or any item or matter in any provision of this Agreement or any Related
Agreement nor the inclusion of any specific item or matter in any
Schedule hereto or thereto is intended to imply that such amount, or higher
or lower amounts, or the item or matter so specified or included, or other
items
or matters, are or are not material, and no party shall use the fact of the
specification of any such amount or the specification or inclusion of any such
item or matter in any dispute or controversy between the parties as to whether
any item or matter is or is not material for purposes of this Agreement or
any
Related Agreement. Neither the specification of any item or matter in any
provision of this Agreement or any Related Agreement nor the inclusion of any
specific item or matter in any Schedule hereto or thereto is intended to imply
that such item or matter, or other items or matters, are or are not in the
ordinary course of business, and no party shall use the fact of the
specification or the inclusion of any such item or matter in any dispute or
controversy between the parties as to whether any item or matter is or is not
in
the ordinary course of business for purposes of this Agreement or any Related
Agreement.
(b) From
the
date of this Agreement until the Closing Date, the Sellers and the Purchaser
agree to communicate in good faith regarding the Business and the transactions
contemplated hereby and to discuss any material events or developments relating
to the Business or the Assets. Notwithstanding the foregoing, the Purchaser
agrees that it shall not assert any claim against any Seller for breach of
this
provision and that no breach or alleged breach of this provision shall be
considered in determining whether the condition set forth in of
Section 7.2
has been
satisfied.
13.18 Disclaimer
of Warranties.
The
Sellers make no representations or warranties with respect to any projections,
forecasts or forward-looking statements made available to the Purchaser,
including the 2007 Budget. There is no assurance that any projected or
forecasted results will be achieved. Except to the extent of the express
representations and warranties contained in Article
4,
the
Sellers are selling the Assets on an “as is, where is” basis and disclaim all
other warranties and representations, whether express or implied. The Sellers
make no representations or warranties as to merchantability or fitness for
any
particular purpose and no implied representations or warranties, and disclaim
all such representations and warranties. The Purchaser understands and
acknowledges that except for the representations and warranties expressly set
forth in this Agreement, none of the Sellers or any of their Representatives
has
made any representation or warranty, express or implied, as to the accuracy
or
completeness of any memoranda, charts, summaries, schedules or other
information, written or oral, heretofore made available to the Purchaser or
its
Representatives by or on behalf of the Sellers (the “Evaluation
Material”).
The
Purchaser agrees that none of the Sellers or their Representatives shall have
any Liability to the Purchaser or any of its Representatives relating to or
resulting from the use of the Evaluation Material or any errors therein or
omissions therefrom, except for any liability resulting from the breach of
the
representations, warranties, covenants and agreements set forth in this
Agreement. The Purchaser also agrees that, except for the representations and
warranties expressly set forth in this Agreement, neither it nor any of its
Representatives has relied upon any representations or warranties of any nature
made by or on behalf of or imputed to any Seller or any of its Representatives,
and the Purchaser acknowledges that, in entering into this Agreement and the
Related Agreements, it has relied solely on its own investigation of the Sellers
and the Business and the representations or warranties expressly set forth
in
this Agreement, subject to the limitations and restrictions specified
herein.
94
13.19 Counterparts.
This
Agreement may be executed in counterparts, each of which shall be deemed an
original, but all of which together shall constitute one and the same
instrument.
*
*
*
95
IN
WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
and delivered as of the date first above written.
LION
COPOLYMER, LLC
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By: | ||
Its: | ||
By: | ||
Name: |
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Title: | ||
CHEMTURA CORPORATION | ||
By: | ||
Name:
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Title: | ||
CHEMTURA
CANADA CO./CIE
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By: | ||
Name:
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Title:
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CHEMTURA
INDUSTRIA QUIMICA DO BRASIL LIMITADA
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By: | ||
Name:
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Title: | ||
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Name:
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Title: |
Signature
Page to Asset Purchase and Sale Agreement
CHEMTURA ITALY S.R.L | ||
By: | ||
Name:
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Title: | ||
CHEMTURA
CORPORATION, S.A. DE C.V.
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By: | ||
Name: |
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Title: | ||
By: | ||
Name: |
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Title: | ||
CHEMTURA
NETHERLANDS B.V.
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By: | ||
Name: |
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Title: | ||
By: | ||
Name: |
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Title: | ||
MONOCHEM,
INC.
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Name: |
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Title: |
UNIROYAL CHEMICAL TAIWAN LTD. | ||
By: | ||
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Title: |