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FIRST AMENDMENT
to
STOCK AND ASSET PURCHASE AGREEMENT
between
ITT INDUSTRIES, INC.
and
XXXXXX-STANDARD AUTOMOTIVE INC.
Dated as of February 6, 2006
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FIRST AMENDMENT TO STOCK AND ASSET PURCHASE AGREEMENT
FIRST AMENDMENT TO STOCK AND ASSET PURCHASE AGREEMENT
THIS FIRST AMENDMENT TO STOCK AND ASSET PURCHASE AGREEMENT (this
"Amendment"), dated as of February 6, 2006, amends that certain Stock and Asset
Purchase Agreement, dated as of December 4, 2005, as amended (the "Agreement"),
between ITT Industries, Inc., an Indiana corporation ("ITT"), and
Xxxxxx-Standard Automotive Inc., an Ohio corporation ("Purchaser"). All
capitalized terms not defined herein shall have the same meaning ascribed
thereto in the Agreement.
WHEREAS, the parties hereto have previously executed and delivered
the Agreement;
WHEREAS, the parties wish to amend the Agreement; and
NOW, THEREFORE, in connection with the Agreement, the transactions
contemplated thereunder and the terms hereof, and in accordance with Sections
11.9 and 11.15 of the Agreement, the parties agree as follows:
1. Amendment to Section 2.3(b). Section 2.3(b) of the Agreement
is hereby amended by deleting the first sentence and replacing it in its
entirety with the following:
"With respect to the French branch of ITT Automotive Europe GmbH & Co. KG
("ITTAE"), on the Business Day prior to the Closing Date ITTAE and the
applicable Designated Asset Purchaser shall execute the French
Implementing Agreements in the forms set forth in Schedules 2.3(b)(i) and
(ii) in order to effect, or with respect to the Owned Real Property
located in France to proceed with the first step to effect, the transfer
of title to the Purchased Assets and the assumption of Assumed Liabilities
to which the French Implementing Agreements relate."
2. Amendment to Section 6.6(k). Section 6.6(k) of the Agreement
is hereby amended by (a) deleting the following words ", and any notes
representing plan loans to participants," and (b) deleting the last sentence of
Section 6.6(k) in its entirety.
3. Amendment to Section 8.1 (Closing). Section 8.1 of the
Agreement is hereby amended by:
(a) deleting the words "Linklaters Oppenhoff Xxxxxx in Cologne"
and replacing them with the words "Wenger Xxxxxxxx in Basel, Switzerland";
(b) deleting the words "on the day before" and replacing them
with the words "on the Business Day before"; and
(c) adding the words "; it being acknowledged that such transfer
will occur in two steps and that title to the Owned Real Property located in
France will only be transferred to the applicable Designated Purchaser after the
Closing" to the end of the penultimate sentence.
FIRST AMENDMENT TO STOCK AND ASSET PURCHASE AGREEMENT
2
4 Exhibit I. Exhibit I of the Agreement is hereby deleted in its
entirety and is replaced by Exhibit I annexed hereto as Annex A.
5. Annex A. Annex A of the Agreement is hereby amended by
deleting the definition of "Target Net Working Capital" in its entirety and
replacing it with the following:
"Target Net Working Capital means U.S. $56,317,000.00."
6. Schedule 6.1. Schedule 6.1 of the Agreement is hereby deleted
in its entirety and is replaced by Schedule 6.1 annexed hereto as Annex B.
7. Further Assurances.
(a) Each of the parties hereto agrees to use its reasonable best
efforts to execute and deliver, or cause to be executed and delivered, all
documents and to take, or cause to be taken, all actions that may be reasonably
necessary or appropriate, in the reasonable opinion of counsel to Purchaser, to
assign or otherwise transfer to ITT Fluid Handling Systems GmbH & Co. KG the
leases for (i) the Leased Real Property located at Xxxxxxx Xxx 0x, X-00000,
Xxxxx-Xxxxxxxxxx, Xxxxxxx (Cologne Sales Office) and (ii) the Leased Real
Property located at ITT FHSE, Xxxx-F.- Xxxxxxx-Xxxxx 00/00, 00000 Xxxxxxxxx,
Xxxxxxx (Wolfsburg Sales Office).
(b) In the event that Purchaser or any of its Affiliate receives
any Excluded Assets, Purchaser agrees to promptly return or cause the return of
such assets to ITT at ITT's expense.
8. Owned Real Property. Each of the parties hereto agrees that
the real property listed on Schedule I hereto shall be deemed to be Owned Real
Property.
9. Authorization. Each party to this Amendment hereby represents
and warrants that:
(a) it has all necessary corporate power and authority to enter
into and deliver this Amendment, to carry out its obligations hereunder and to
consummate the transactions contemplated hereby;
(b) the execution and delivery of this Amendment by it, the
performance by it of its obligations hereunder and the consummation by it of the
transactions contemplated hereunder have been authorized by all requisite
corporate, shareholder or other action; and
(c) this Amendment has been duly executed and authorized by it
and (assuming due authorization, execution and delivery by the other party)
constitutes a, valid and legally binding obligation of it, enforceable against
it in accordance with its terms except as enforceability may be affected by
bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and
other similar laws relating to or affecting creditors' rights generally, general
equitable principles (whether considered in a proceeding in equity or at law)
and an implied covenant of good faith and fair dealing.
FIRST AMENDMENT TO STOCK AND ASSET PURCHASE AGREEMENT
3
10. Effect of the Amendment. Each party acknowledges that this
Amendment constitutes a written agreement as contemplated by Section 11.9 of the
Agreement. Except as expressly modified or amended hereby, all terms and
provisions of the Agreement shall continue in full force and effect.
11. Governing Law. This Amendment shall be governed by, and
construed in accordance with, the laws of the State of New York, except for the
internal matters of any corporation, partnership or similar entity, which shall
be governed by the laws of the jurisdictions of incorporation of such
corporation, partnership or similar entity.
12. Counterparts. This Amendment may be executed in any number of
counterparts, each of which shall be deemed to be an original and all of which
together shall be deemed to be one and the same instrument. Copies of executed
counterparts transmitted by facsimile or other electronic transmission service
shall be considered original executed counterparts for purposes of this
paragraph; provided, that receipt of copies of such counterparts is confirmed.
FIRST AMENDMENT TO STOCK AND ASSET PURCHASE AGREEMENT
IN WITNESS WHEREOF, the parties have caused this Amendment to be
duly executed as of the date first above written
ITT INDUSTRIES, INC.
By: __________________________________
Name:
Title:
XXXXXX-STANDARD AUTOMOTIVE INC.
By: __________________________________
Name:
Title:
FIRST AMENDMENT TO STOCK AND ASSET PURCHASE AGREEMENT
Schedule I
Xxx 00 xx Xxxxxxx Xxxx xx XXXXX Xxxxxxxxxx Xxxx, according to the recorded plat
thereof, as recorded in Liber 17 of Plats, page 1-3, Iosco County Records.
Tax parcel ID number: 033-T30-000-012-00.
Commonly know as 000 Xxxxxxxx Xxxx, Xxxx Xxxxx Xxxxxxxx 00000
FIRST AMENDMENT TO STOCK AND ASSET PURCHASE AGREEMENT
Annex A
EXHIBIT I
1. Allocation of Purchase Price
The Purchase Price shall be allocated as between the various
portions of the Business, by country, as follows (more detailed allocations will
be required for the businesses in Canada, France and U.S.):
Percentage of
Purchase Price
--------------
Australia
-- ITT Fluid Handling Systems Australia, PTY, LTD.* 0.0%
Canada
-- ITT Industries of Canada L.P. in respect of the Business 10.6%
China
-- ITT Automotive-Fluid Handling Systems (Suzhou) Co., Ltd* 0.00%
Czech Republic
-- ITT Fluid Handling Systems Czech Republic s.r.o 1.1%
France
-- ITT Automotive Europe GmbH & Co. KG in respect of the French branch 5.5%
Germany
-- ITT Fluid Handling Systems GmbH & Co. KG 7.5%
-- ITT Xxxxxx Xxxx GmbH & Co. KG** 12.5%
-- Fluid Handling Systems Management GmbH 0.0%
Mexico*
-- ITT Automotive Fluid Handling Systems, S.A. de C.V. 0.8%
United States*** 62.0%
-- ITT Automotive, Inc.
-- Intellectual Property
TOTAL 100%
* Included as part of acquisition of ITT Automotive, Inc. (i.e. total
purchase price for U.S. equals 62.8%)
** Includes U.S. $30,000 for Fluid Handling Systems Management GmbH
FIRST AMENDMENT TO STOCK AND ASSET PURCHASE AGREEMENT
2
*** Purchase Price for U.S. Business to be allocated between stock of ITT
Automotive, Inc. and Intellectual Property sold by ITT Industries, Inc.
and ITT Manufacturing Enterprises, Inc.
2. Further Allocation of Purchase Price Allocated to Canada, France and the
United States
a) United States Allocation - Purchaser and ITT agree that the Purchase
Price allocated to U.S. shall be U.S. $128,740,000 (includes
Mexico). Purchaser and ITT agree that up to a maximum of U.S.
$15,000,000 of the purchase price of the U.S. Business will be
allocated to Intellectual Property and any other intangible assets
of the Business owned by ITT and/or ITTME (including trademarks,
tradenames, patents, and patent applications). Purchaser shall
provide ITT with an appropriate value for such Intellectual Property
upon completion of an outside appraisal of such assets to be
performed by a third-party valuation firm. Purchaser shall provide
such allocation consistent with the requirements of Section 3.5 of
the Agreement.
b) Canada Allocation - Purchaser and ITT agree that the Canadian
portion of the Purchase Price of U.S. $21,730,000 shall be allocated
in the following manner:
i. Real, Personal and Construction in Progress - U.S.
$9,200,000, in accordance with the attached schedule.
ii. Cash, accounts receivables, prepaid accounts and all
other assets on the books - at their book value as of
the Closing Date.
iii. Inventory shall be marked up to include its realizable
profit, approximately 15%.
iv. Balance to Goodwill.
c) French Allocation - Purchaser and ITT agree that the French portion
of the Purchase Price of U.S. $11,275,000 ((euro) 9,020,000) and
Assumed Liabilities of (euro) 1,587,050 shall be allocated in the
following manner:
i. Real estate (land and building) - (euro) 1,393,503
ii. Equipment (machinery & equipment) - (euro) 3,222,212
iii. Other Property - (euro) 1,832,419
iv. Inventories (euro) 743,459
v. Receivables - (euro) 2,299,958
vi. Goodwill - (euro) 1,115,498
FIRST AMENDMENT TO STOCK AND ASSET PURCHASE AGREEMENT
Annex B
SCHEDULE 6.1
CONDUCT OF BUSINESS (SECTION 6.1):
Adopt, amend or modify any plans maintained (or to be maintained) at the ITT
parent level, to the extent any such plan or amendment will affect a material
amount of the ITT consolidated group employee population, or extend a medical
plan that is maintained at the ITT parent level to the extent any such plan is
included in the ITT national medical program.
ITT may amend its hourly pension and/or savings plans, provided that such
amendments are made to all ITT Industries hourly pension and/or savings plans.
ITT may amend its flexible spending account plans to provide for certain
statutorily permitted grace periods in 2005 and 2006.
The following persons, who, as of the date of the Agreement, are employed
(actively or inactively) by an FHS Company or an Asset Seller with respect to
the Business, will not be Employees of an FHS Company or an Asset Seller with
respect to the Business as of the Closing Date:
1) X. X. Xxxx
2) X. Xxxxxxxxx
3) X. Xxxxxxxx
4) X. Xxxx
5) X. Xxxxxxx
6) X. Xxxxxx
7) T. Snow
FIRST AMENDMENT TO STOCK AND ASSET PURCHASE AGREEMENT
