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Exhibit 2.1
STOCK AND ASSET PURCHASE AGREEMENT
STOCK AND ASSET PURCHASE AGREEMENT, dated as of July 26, 1999
(this "AGREEMENT"), among Century Aluminum Company, a Delaware corporation
("CENTURY"), Century Aluminum of West Virginia, Inc., a Delaware corporation
("CENTURY WV" and, together with Century, the "SELLERS") and Pechiney Rolled
Products LLC, a Delaware limited liability company (the "PURCHASER").
W I T N E S S E T H:
WHEREAS, the Sellers, directly and indirectly, are engaged in
the Business (as defined herein);
WHEREAS, Century WV desires to sell to the Purchaser, and the
Purchaser desires to purchase from Century WV, all right, title and interest of
Century WV in and to property and assets relating to the Rolling Business (as
defined herein), and in connection therewith the Purchaser is willing to assume
certain liabilities of Century WV and Century relating thereto, all upon the
terms and subject to the conditions set forth herein; and
WHEREAS, Century desires to sell to the Purchaser, and the
Purchaser desires to purchase from Century, 100 shares (the "SHARES") of common
stock ("COMMON STOCK"), par value $1.00 per share, of Century Cast Plate, Inc.
("CENTURY CP"), upon the terms and subject to the conditions set forth herein;
NOW, THEREFORE, in consideration of the premises and the
mutual agreements and covenants hereinafter set forth, and intending to be
legally bound hereby, the parties hereto hereby agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01. Certain Defined Terms. As used in this
Agreement, the following terms shall have the following meanings:
"ACTION" means any claim, action, charge, suit, arbitration,
inquiry, proceeding or investigation by or before any Governmental Authority.
"ADJUSTED REFERENCE NET WORKING CAPITAL" means an amount equal
to the Net Working Capital reflected on the Reference Balance Sheet plus (a) the
Adjusted Pre-Closing
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NWC Increase in the event the Purchase Price is adjusted upward pursuant to
Section 2.08(b) or (b) minus the Adjusted Pre-Closing NWC Decrease in the event
the Purchase Price is adjusted downward pursuant to Section 2.08(b); provided
that if the Purchase Price is not adjusted pursuant to Section 2.08, the
Adjusted Reference Net Working Capital shall equal the Net Working Capital
reflected on the Closing Balance Sheet.
"AFFILIATE" means, with respect to any specified Person, any
other Person that directly, or indirectly through one or more intermediaries,
Controls, is Controlled by, or is under common Control with, such specified
Person.
"AGREEMENT" means this Stock and Asset Purchase Agreement,
dated as of July 26, 1999, among the Sellers and the Purchaser (including the
Exhibits and Schedules hereto and the Disclosure Schedule) and all amendments
hereto made in accordance with the provisions of Section 11.09.
"ANCILLARY AGREEMENTS" means the Xxxx of Sale, the Deed, the
Assumption Agreement, the Molten Aluminum Purchase Agreement, the Shared
Services Agreement, the Management Services Agreement, the Xxxxxx Indemnity
Agreement and the Ravenswood Indemnity Agreement.
"ASSETS" means the Shares and the Rolling Assets.
"ASSUMPTION AGREEMENT" means the Assumption Agreement to be
executed by the Purchaser and Century WV on the Closing Date substantially in
the form of Exhibit A.
"XXXX OF SALE" means the Xxxx of Sale and Assignment to be
executed by Century WV on the Closing Date substantially in the form of Exhibit
B.
"BUSINESS" means the Rolling Business and the business of the
manufacture by Century CP and sale thereof of cast aluminum plate (meaning all
products that are cast through a horizontal or vertical process which produces
plates with thickness of more than 1/4 inch) as conducted immediately prior to
the date hereof.
"BUSINESS DAY" means any day that is not a Saturday, a Sunday
or other day on which banks are required or authorized by Law to be closed in
The City of New York.
"CLOSING BALANCE SHEET" means the statement of assets and
liabilities of the Business, to be prepared pursuant to Section 2.09(a) and to
be dated as of the Closing Date.
"CODE" means the Internal Revenue Code of 1986, as amended
through the date hereof.
"CONFIDENTIALITY AGREEMENT" means the letter agreement dated
January 4, 1999 between Century and Pechiney, a French societe anonyme.
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"CONTROL" (including the terms "CONTROLLED BY" and "UNDER
COMMON CONTROL WITH"), with respect to the relationship between or among two or
more Persons, means the possession, directly or indirectly or as trustee,
personal representative or executor, of the power to direct or cause the
direction of the affairs or management of a Person, whether through the
ownership of voting securities, as trustee, personal representative or executor,
by contract or otherwise, including, without limitation, the ownership, directly
or indirectly, of securities having the power to elect a majority of the board
of directors or similar body governing the affairs of such Person.
"DEED" means the deed to be executed by Century WV on the
Closing Date substantially in the form of Exhibit C in order to convey to the
Purchaser the Ravenswood Owned Real Property.
"DESIGNATED AMOUNT" means U.S.$1,000,000.
"DISCLOSURE SCHEDULE" means the Disclosure Schedule attached
hereto, dated as of the date hereof, and forming a part of this Agreement.
"ENCUMBRANCE" means any security interest, pledge, mortgage,
lien (including, without limitation, environmental and tax liens), charge,
encumbrance, adverse claim, preferential arrangement, or restriction of any
kind, including, without limitation, any restriction on the use, voting,
transfer, receipt of income or other exercise of any attributes of ownership.
"ENVIRONMENTAL CLAIMS" means any and all actions, suits,
demands or demand letters by any Governmental Authority, claims, liens, notices
of noncompliance or violation by any Governmental Authority, notices of
liability or potential liability by any Governmental Authority, investigations,
proceedings, consent orders or consent agreements relating in any way to any
Environmental Law, any Environmental Permit or any Hazardous Materials.
"ENVIRONMENTAL LAW" means any Law, and any legally binding
judicial or administrative interpretation thereof, in each case in effect as of
the Closing, including any judicial or administrative order, consent decree or
judgment, relating to pollution or protection of the environment, health, safety
or natural resources, including, without limitation, those relating to the use,
handling, transportation, treatment, storage, disposal, release or discharge of
Hazardous Materials.
"ENVIRONMENTAL PERMIT" means any permit, approval,
identification number, license or other authorization required under any
applicable Environmental Law.
"ESSENTIAL FACILITIES" means the real property and assets
identified as such in the Shared Services Agreement.
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"GOVERNMENTAL AUTHORITY" means any United States federal,
state or local or any foreign government, governmental, regulatory or
administrative authority, agency or commission or any court, tribunal, or
judicial or arbitral body.
"GOVERNMENTAL ORDER" means any order, writ, judgment,
injunction, decree, stipulation, determination or award entered by or with any
Governmental Authority.
"HAZARDOUS MATERIAL" means petroleum and petroleum products,
by-products or breakdown products, radioactive materials, asbestos-containing
materials, polychlorinated biphenyls ("PCB" or "PCBs") and any other chemicals,
materials or substances, in each case and to the extent regulated under any
applicable Environmental Law.
"HSR ACT" means the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements
Act of 1976, as amended, and the rules and regulations promulgated thereunder.
"INDEBTEDNESS" means, with respect to any Person, (a) all
indebtedness of such Person, whether or not contingent, for borrowed money, (b)
all obligations of such Person evidenced by notes, bonds, debentures or other
similar instruments, (c) all obligations of such Person as lessee under leases
that have been or should be, in accordance with U.S. GAAP, recorded as capital
leases, (d) all obligations, contingent or otherwise, of such Person under
acceptance, letter of credit or similar facilities, (e) all obligations of such
Person to purchase, redeem, retire, defease or otherwise acquire for value any
capital stock of such Person or any warrants, rights or options to acquire such
capital stock, valued, in the case of redeemable preferred stock, at the greater
of its voluntary or involuntary liquidation preference plus accrued and unpaid
dividends, (f) all Indebtedness of others referred to in clauses (a) through (e)
above guaranteed directly or indirectly in any manner by such Person, or in
effect guaranteed directly or indirectly by such Person through an agreement (i)
to pay or purchase such Indebtedness or to advance or supply funds for the
payment or purchase of such Indebtedness, (ii) to purchase, sell or lease (as
lessee or lessor) property, or to purchase or sell services, primarily for the
purpose of enabling the debtor to make payment of such Indebtedness or to assure
the holder of such Indebtedness against loss, (iii) to supply funds to or in any
other manner invest in the debtor (including any agreement to pay for property
or services irrespective of whether such property is received or such services
are rendered) or (iv) otherwise to assure a creditor against loss, and (i) all
Indebtedness referred to in clauses (a) through (e) above secured by (or for
which the holder of such Indebtedness has an existing right, contingent or
otherwise, to be secured by) any Encumbrance on property (including, without
limitation, accounts and contract rights) owned by such Person, even though such
Person has not assumed or become liable for the payment of such Indebtedness.
"INTELLECTUAL PROPERTY" means (a) inventions, whether or not
patentable, whether or not reduced to practice or whether or not yet made the
subject of a pending patent application or applications, (b) ideas and
conceptions of potentially patentable subject matter, including, without
limitation, any patent disclosures, whether or not reduced to practice and
whether or not yet made the subject of a pending patent application or
applications, (c) national (including the
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United States) and multinational statutory invention registrations, patents,
patent registrations and patent applications (including all reissues, divisions,
continuations, continuations-in-part, extensions and reexaminations) and all
rights therein provided by multinational treaties or conventions and all
improvements to the inventions disclosed in each such registration, patent or
application, (d) trademarks, service marks, trade dress, logos, trade names and
corporate names, whether or not registered, including all common law rights, and
registrations and applications for registration thereof, including, but not
limited to, all marks registered in the United States Patent and Trademark
Office, the Trademark Offices of the States and Territories of the United States
of America, and the Trademark offices of other nations throughout the world, and
all rights therein provided by multinational treaties or conventions, (e)
copyrights (registered or otherwise) and registrations and applications for
registration thereof, and all rights therein provided by multinational treaties
or conventions, (f) computer software, including, without limitation, source
code, operating systems and specifications, data, data bases, files,
documentation and other materials related thereto, data and documentation, (g)
trade secrets and confidential, technical or business information (including
ideas, formulas, compositions, inventions, and conceptions of inventions whether
patentable or unpatentable and whether or not reduced to practice), (h) whether
or not confidential, technology (including know-how and show-how), manufacturing
and production processes and techniques, research and development information,
drawings, specifications, designs, plans, proposals, technical data,
copyrightable works, financial, marketing and business data, pricing and cost
information, business and marketing plans and customer and supplier lists and
information, (i) copies and tangible embodiments of all the foregoing, in
whatever form or medium, (j) all rights to obtain and rights to apply for
patents, and to register trademarks and copyrights, and (k) all rights to xxx
and recover and retain damages and costs and attorneys' fees for present and
past infringement of any of the Intellectual Property rights hereinabove set
out.
"INVENTORIES" means all inventory, merchandise,
work-in-progress, finished goods, and raw materials related to the Business,
maintained, held or stored by or for the Sellers or Century CP in respect of the
Business on the Closing Date and any prepaid deposits for any of the same.
"IRS" means the Internal Revenue Service of the United States.
"KNOWLEDGE OF THE SELLERS" or "TO THE SELLERS' KNOWLEDGE"
means the knowledge of any of (a) any officer of the Sellers or Century CP or
(b) any Senior Manager, but only in respect of a Senior Manager's department or
area; which in each case shall be deemed to include the knowledge which any such
person would have had if they had made reasonable inquiry.
"LAW" means any federal, state, local or foreign statute, law,
ordinance, regulation, rule, code, order, requirement or rule of common law.
"LLC" means the limited liability company established pursuant
to the LLC Agreement to own the Essential Facilities.
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"LLC AGREEMENT" means the limited liability company agreement
to be entered into between Century WV and the Purchaser pursuant to the Shared
Services Agreement.
"LEASED REAL PROPERTY" means the real property leased pursuant
to the office leases listed in Schedule 1.01(a).
"LIABILITIES" means any and all debts, liabilities and
obligations, whether accrued or fixed, absolute or contingent, matured or
unmatured, known or unknown, or determined or determinable, including, without
limitation, those arising under any Law (including, without limitation, any
Environmental Law), Action or Governmental Order and those arising under any
contract, agreement, arrangement, commitment or undertaking.
"LICENSED INTELLECTUAL PROPERTY" means all Intellectual
Property licensed or sublicensed from a third party by (a) Century WV and used
in connection with the Business or (b) Century CP.
"MAJOR CUSTOMER" means The Boeing Company.
"MANAGEMENT SERVICES AGREEMENT" means the Management Services
Agreement to be entered into between Century and the Purchaser, in the form
attached hereto as Exhibit D.
"MATERIAL ADVERSE EFFECT" means any circumstance, change in,
or effect on, the Business that, individually or in the aggregate with any other
circumstances, changes in, or effects on, the Business: (a) is, or is reasonably
likely to be, materially adverse to the Business or the assets or liabilities
(including, without limitation, contingent liabilities), results of operations
or the condition (financial or otherwise) of the Business, taken as a whole, or
(b) materially adversely affects, or is reasonably likely to materially
adversely affect, the ability of the Purchaser to operate or conduct the
Business in the manner in which it is currently operated or conducted, except,
in each case for such circumstances, changes or effects resulting from changes
in general economic market conditions or changes that generally affect
businesses of the same type as the Business.
"MOLTEN ALUMINUM PURCHASE AGREEMENT" means the Molten Aluminum
Purchase Agreement to be entered into between Century WV and the Purchaser, in
the form attached hereto as Exhibit E.
"NET WORKING CAPITAL" means the excess of the current assets
over the current liabilities (in each case as set forth on Schedule 1.01(b))
shown on any specified statement of assets and liabilities of the Business
prepared on a basis consistent with the preparation of the Reference Balance
Sheet.
"OWNED INTELLECTUAL PROPERTY" means all Intellectual Property
in and to which Century WV or Century CP holds, or has a right to hold, right,
title and interest and which, in the case of Century WV, is used in connection
with the Business.
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"OWNED REAL PROPERTY" means the Ravenswood Owned Real Property
and the Xxxxxx Owned Real Property.
"PBGC" means the Pension Benefit Guaranty Corporation.
"PBGC AGREEMENT" means the agreement described in Section
6.07.
"PERMITTED ENCUMBRANCES" means such of the following as to
which no enforcement, collection, execution, levy or foreclosure proceeding
shall have been commenced: (a) liens for Taxes, assessments and governmental
charges or levies not yet due and payable; (b) Encumbrances imposed by Law, such
as materialmen's, mechanics', carriers', workmen's, converters', warehousemen's
and repairmen's liens and other similar liens arising in the ordinary course of
business securing obligations; (c) pledges or deposits to secure obligations
under workers' compensation laws or similar legislation or to secure public or
statutory obligations; and (d) minor survey exceptions, reciprocal easement
agreements and other customary encumbrances on title to real property that (i)
were not incurred in connection with any Indebtedness, (ii) do not render title
to the property encumbered thereby unmarketable and (iii) do not, individually
or in the aggregate, materially adversely affect the value of or the use of such
property for its present purposes.
"PERMITTED PROPERTY ENCUMBRANCES" means the encumbrances
listed in Schedule 1.01(c).
"PERSON" means any individual, partnership, firm, corporation,
association, trust, unincorporated organization or other entity, as well as any
syndicate or group that would be deemed to be a person under Section 13(d)(3) of
the Securities Exchange Act of 1934, as amended.
"PURCHASER'S ACCOUNTANTS" means PricewaterhouseCoopers,
independent accountants of the Purchaser.
"RAVENSWOOD INDEMNITY AGREEMENT" means the indemnification
agreement relating to the Rolling Business to be entered into between Century WV
and the Purchaser, in the form attached hereto as Exhibit F.
"RAVENSWOOD OWNED REAL PROPERTY" means the real property
listed in Schedule 1.01(d), together with all buildings and other structures,
facilities or improvements currently or hereafter located thereon, all fixtures,
systems, equipment and items of personal property attached or appurtenant
thereto and all easements, licenses, rights and appurtenances relating to the
foregoing.
"REAL PROPERTY" means the Leased Real Property and the Owned
Real Property.
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"RECEIVABLES" means any and all accounts receivable, notes and
other amounts receivable from customers arising from the conduct of the Business
before the Closing Date, whether or not in the ordinary course, together with
any unpaid financing charges accrued thereon.
"REFERENCE BALANCE SHEET" means the statement of assets and
liabilities of the Business, dated as of December 31, 1998, a copy of which is
set forth in Section 3.07(a)(i) of the Disclosure Schedule.
"REFERENCE BALANCE SHEET DATE" means December 31, 1998.
"REGULATIONS" means the Treasury Regulations (including
Temporary Regulations) promulgated by the United States Department of Treasury
with respect to the Code or other federal tax statutes.
"RELEASE" means disposing, discharging, injecting, spilling,
leaking, leaching, dumping, emitting, escaping, emptying, seeping, placing and
the like of Hazardous Materials into or upon any land or water or air or
otherwise entering into the environment.
"REMEDIAL ACTION" means all action to (i) clean up, remove,
treat or handle in any other way Hazardous Materials in the environment; (ii)
restore or reclaim the environment or natural resources with respect to
Hazardous Materials; (iii) prevent the Release of Hazardous Materials so that
they do not migrate, endanger or threaten to endanger public health or the
environment; or (iv) perform remedial investigations, feasibility studies,
corrective actions, closures and postremedial or postclosure studies,
investigations, operations, maintenance and monitoring on, about or in any Real
Property in each case in respect of Hazardous Materials.
"ROLLING BUSINESS" means the business of the casting operation
and the manufacture of flat-rolled sheet aluminum (including, without
limitation, plate and coil, distributor coil, flat sheet and brazing sheet), in
each case at the Ravenswood, West Virginia facility of Century WV and the sale
of such products, all as conducted immediately prior to the date hereof.
"SELLERS' ACCOUNTANTS" means Deloitte & Touche, L.P.,
independent accountants of the Sellers.
"SENIOR MANAGERS" means the individuals holding, or performing
the functions corresponding to, the positions listed in Schedule 1.01(e).
"SHARED SERVICES AGREEMENT" means the Shared Services
Agreement dated the date hereof between Century WV and the Purchaser.
"SUBSIDIARIES" means any and all corporations, partnerships,
joint ventures, associations and other entities controlled by Century directly
or indirectly (other than Century WV) through one or more intermediaries.
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"TAX" or "TAXES" means any and all taxes, fees, levies,
duties, tariffs, imposts, and other charges of any kind (together with any and
all interest, penalties, additions to tax and additional amounts imposed with
respect thereto) imposed by any government or taxing authority, including,
without limitation: taxes or other charges on or with respect to income,
franchises, windfall or other profits, gross receipts, property, sales, use,
capital stock, payroll, employment, social security, workers' compensation,
unemployment compensation, or net worth; taxes or other charges in the nature of
excise, withholding, ad valorem, stamp, transfer, value added, or gains taxes;
license, registration and documentation fees; and customs' duties, and similar
charges.
"U.S. GAAP" means United States generally accepted accounting
principles and practices in effect from time to time applied consistently
throughout the periods involved.
"XXXXXX INDEMNITY AGREEMENT" means the indemnification
agreement relating to Century CP to be entered into between Century and the
Purchaser, in the form attached hereto as Exhibit G.
"XXXXXX OWNED REAL PROPERTY" means the real property listed in
Schedule 1.01(f), together with all buildings and other structures, facilities
or improvements currently or hereafter located thereon, all fixtures, systems,
equipment and items of personal property attached or appurtenant thereto and all
easements, licenses, rights and appurtenances relating to the foregoing.
SECTION 1.02. Other Defined Terms. The following terms have
the meanings defined for such terms in the Sections set forth below:
Term Section
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Adjusted Pre-Closing NWC Decrease 2.08(b)
Adjusted Pre-Closing NWC Increase 2.08(b)
Agreed Estimated Net Working Capital 2.08(a)
Alcoa 3.17(a)(x)
Alcoa Agreement 6.12
Alcoa Plans 6.13(a)
Allocation Statement 2.04(b)
Assumed Liabilities 2.02(a)
Business Assets 3.20(a)
Century Preamble
Century Common Stock Recitals
Century CP Recitals
Century CP Plan 3.22(h)
Century CP Plans 3.22(h)
Century WV Preamble
Century WV Shares 3.02(a)
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Term Section
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Closing 2.05
Closing Date 2.05
Code section 338(h)(10) Election 7.07(a)
Collateral 8.02(d)
Common Stock Recitals
Covered Products 5.07(a)
Default Estimated Net Working Capital 2.08(a)
Disclosure Schedule Supplements 3.31
Disclosure Schedule Supplement 5.05(a)
Elections 7.07(a)
Employee Amounts 6.06
ERISA 3.22(a)
Excluded Assets 2.01(b)
Excluded Liabilities 2.02(b)
Final Determination 7.04
Financial Statements 3.07(a)
Form 8023 7.07(b)
Former Employees 6.03(b)
Indemnified Party 9.04(a)
Indemnifying Party 9.04(a)
Independent Accounting Firm 2.09(b)(ii)
Independent Expert 9.05(b)
Initial Transfer Amount 6.03(e)
Kaiser 3.17(a)(x)
Lockheed 8.02(l)
Loss 9.02(a)
Market Risk Period 6.03(g)
Material Contracts 3.17(a)
Material Licenses 3.30
Money Market Vehicle 6.03(g)
Multiemployer Plan 3.22(b)
Multiple Employer Plan 3.22(b)
New Collective Bargaining Agreement 2.10(a)
New Defined Benefit Plans 6.03(a)
New Xxxxxx Plans 6.13(a)
Old Collective Bargaining Agreement 2.10(a)
PBO Amount 6.03(g)
Plans 3.22(a)
Purchase Price 2.04(a)
Purchaser Preamble
Purchaser Indemnified Party 9.02(a)
Purchaser's Actuary 6.03(d)
Purchaser's Defined Contribution Plans 6.11
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Term Section
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Reduction Facility 2.01(b)(v)
Restricted Period 5.07(a)
Returns 7.02
Rolling Assets 2.01(a)
Safe Harbor Assumptions 6.03(d)
Section 9.02(a)(iii) Loss 9.05(b)
Section 9.03 Loss 9.05(b)
Selected Business Assets 3.20(a)
Seller Indemnified Party 9.03(a)
Sellers' Actuary 6.03(d)
Sellers' Defined Contribution Plans 6.11
Sellers Estimated Net Working Capital 2.08(a)
Sellers' Pension Plans 6.03(b)
Sellers' Recitals
Shared Intellectual Property 5.12
Shares Recitals
Third Party Claims 9.04(a)
Title Company 8.02(n)
Title Policy 8.02(n)
Transferred Benefits 6.03(b)
Transferred Employee 6.01
True-Up Amount 6.03(e)
True-Up Date 6.03(e)
USWA 8.02(k)
Xxxxxx Employees 6.13(a)
WARN 3.22(g)
ARTICLE II
PURCHASE AND SALE
SECTION 2.01. Purchase and Sale of Assets. (a) On the terms
and subject to the conditions of this Agreement, Century WV shall, on the
Closing Date, sell, assign, transfer, convey and deliver to the Purchaser or
cause to be sold, assigned, transferred, conveyed and delivered to the
Purchaser, and the Purchaser shall purchase from Century WV, on the Closing
Date, all the assets, properties, goodwill and business of every kind and
description and wherever located, whether tangible or intangible, real, personal
or mixed, directly or indirectly owned by Century WV or to which Century WV is
directly or indirectly entitled and, in any case, belonging to or used in the
Rolling Business, other than the Excluded Assets described in Section 2.01(b)
(the assets to be purchased by the Purchaser being referred to as the "ROLLING
ASSETS"), including, without limitation, the following:
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(i) the Rolling Business as a going concern;
(ii) all the Ravenswood Owned Real Property, and all rights in
respect of the Leased Real Property;
(iii) all furniture, fixtures, equipment, machinery, spare
parts, packaging materials, oil and other tangible personal property
used or held for use by the Sellers at the locations at which the
Rolling Business is conducted (including, without limitation, tangible
personal property held in storerooms), or otherwise owned or held by
the Sellers at the Closing Date for use in the conduct of the Rolling
Business and not otherwise included in clause (ii) above, including,
without limitation, the items listed in Schedule 2.01(a)(iii);
(iv) all vehicles and transportation equipment, including,
without limitation, the items listed in Schedule 2.01(a)(iv);
(v) all Inventories of the Rolling Business;
(vi) all Receivables of the Rolling Business;
(vii) all books of account, general, environmental, health and
safety, financial, tax and personnel records, claim and grievance
records, environmental reports, invoices, technical records and
drawings, shipping records, supplier lists, correspondence and other
documents, records and files and all computer software and programs and
any rights thereto owned, associated with or employed by the Sellers or
used in, or relating to, the Rolling Business at the Closing Date,
other than organization documents, minute and stock record books and
the corporate seal of the Sellers;
(viii) the goodwill of the Sellers relating to the Rolling
Business;
(ix) subject to Section 5.12, all the Sellers' right, title
and interest in, to and under the Owned Intellectual Property and, the
Licensed Intellectual Property used in, or relating to, the Rolling
Business;
(x) all claims, causes of action, choses in action, rights of
recovery and rights of set-off of any kind (including rights to
insurance proceeds relating to an Assumed Liability and rights under
and pursuant to all warranties, representations and guarantees made by
suppliers of products, materials or equipment, or components thereof),
pertaining to, or arising out of, the Rolling Business and enuring to
the benefit of the Sellers;
(xi) all sales and promotional literature, customer lists and
other sales-related materials owned, used, associated with or employed
by the Sellers at the Closing Date used in, or relating to, the Rolling
Business;
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(xii) all rights of the Sellers under all contracts, licenses,
sublicenses, agreements, leases, commitments, and sales and purchase
orders, and under all commitments, bids and offers (to the extent such
offers are transferable), used in, or relating to, the Rolling Business
including, without limitation, those listed in Schedule 2.01(a)(xii);
(xiii) all municipal, state and federal franchises, permits,
licenses, agreements, waivers and authorizations held or used by the
Sellers in connection with, or required for, the Rolling Business, to
the extent transferable, including, without limitation, those listed in
Schedule 2.01(a)(xiii);
(xiv) all the Sellers' right, title and interest on the
Closing Date in, to and under all other assets, rights and claims of
every kind and nature used in the operation of, or residing with, the
Rolling Business;
(xv) to the extent contemplated in the Shared Services
Agreement, the membership interest in the LLC; and
(xvi) all assets of the Rolling Business to the extent
specifically reflected in the Closing Balance Sheet.
(b) The Rolling Assets shall exclude the following assets
owned or leased by Century WV (the "EXCLUDED ASSETS"):
(i) all real property, whether owned or leased, together with,
to the extent owned or leased, all buildings and other structures,
facilities or improvements currently or hereafter located thereon, and
all fixtures, systems and equipment attached or appurtenant thereto
other than the Ravenswood Owned Real Property and the Leased Real
Property;
(ii) all cash, cash equivalents and bank accounts owned by the
Century WV at the Closing Date, including, without limitation, all
deposits of Century WV as security for workers' compensation claims;
(iii) all rights of Century WV under this Agreement and the
Ancillary Agreements;
(iv) the Oracle GEMMS software and any rights or claims in
respect thereof;
(v) all the assets, properties and goodwill belonging to or
used by Century WV in connection with its operation of its reduction
facility in Ravenswood, West Virginia ("REDUCTION FACILITY") which are
not also used in the operation of the Business;
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(vi) in respect of assets, properties and goodwill used by
both the Reduction Facility and the Rolling Business, such assets,
properties and goodwill used primarily by the Reduction Facility;
(vii) the assets and properties ownership of which is to be
retained by Century WV pursuant to the Shared Services Agreement; and
(viii) all rights to insurance proceeds, except to the extent
relating to an Assumed Liability, under insurance policies of the
Sellers.
SECTION 2.02. Assumption and Exclusion of Liabilities. (a) On
the terms and subject to the conditions of this Agreement, the Purchaser shall,
on the Closing Date, assume and shall agree to pay, perform and discharge when
due the following Liabilities of Century WV (the "ASSUMED LIABILITIES"):
(i) all Liabilities relating to or arising from the operation
of the Rolling Business on or after the Closing Date, except as
otherwise provided in Article VI with respect to employee benefit
matters;
(ii) subject to clause (iii) below, all Liabilities relating
to or arising from the ownership or use of the Rolling Assets on or
after the Closing Date, including, without limitation, all Liabilities
under all claims, suits, actions, contracts, licenses, sublicenses,
agreements, leases, commitments, and sales and purchase orders, and
under all commitments, bids and offers;
(iii) all Liabilities relating to or arising out of Actions
brought against the Rolling Business associated with employment
actions, omissions or events, including, without limitation, employment
discrimination claims and claims for workplace related injuries by
employees which occurred or were incurred or accrued on or before the
Closing Date; provided that no such Liabilities (other than workers'
compensation claims) shall be assumed to the extent they (together with
all Liabilities relating to or arising out of Actions (other than
workers' compensation claims) brought against Century CP associated
with employment actions, omissions or events which were incurred or
accrued on or before the Closing Date) exceed $600,000, individually or
in the aggregate;
(iv) all Liabilities relating to or arising from the matters
set forth in Section 3.16(a) of the Disclosure Schedule (other than the
Excluded Liabilities as set forth in Section 2.02(b)(vi));
(v) subject to Section 2.02(a)(iii), all Liabilities relating
to or arising out of Actions brought against the Rolling Business
before, on or after the Closing Date; and
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(vi) all accrued liabilities of the Rolling Business to the
extent specifically reflected in the Closing Balance Sheet.
(b) Notwithstanding subsection (a) above, Century WV shall
retain responsibility for, and the Purchaser shall not assume or have any
responsibility for, all Liabilities of Century WV as of the Closing Date other
than the Assumed Liabilities (the "EXCLUDED LIABILITIES"), including, without
limitation:
(i) except to the extent accrued on the Closing Balance Sheet
in respect of the Rolling Business, all Taxes now or hereafter owed by
the Sellers or any Affiliate of the Sellers, or attributable to the
Rolling Assets or the Rolling Business, relating to any period, or any
portion of any period, ending on or prior to the Closing Date (as
provided in Section 7.01);
(ii) except as otherwise provided in Article VI, any
Liabilities for benefits, or under any of the Rolling Business' Plans;
(iii) all Liabilities relating to or arising out of the
Excluded Assets;
(iv) all Liabilities relating to or arising out of Actions
brought against the Rolling Business (other than workers' compensation
claims) associated with employment actions, omissions or events,
including, without limitation, employment discrimination claims, and
claims for workplace related injuries by employees which occurred or
were incurred or accrued on or before the Closing Date, but only to the
extent such Liabilities (together with all Liabilities relating to or
arising out of Actions (other than workers' compensation claims)
brought against Century CP associated with employment actions,
omissions or events which were incurred or accrued on or before the
Closing Date), individually or in the aggregate, exceed $600,000;
(v) all Liabilities in the nature of product liability claims
relating to or arising out of allegations of personal injury or
property damage suffered by any third party (A) on or prior to the
Closing Date or (B) attributable to products sold or shipped, or
Inventory purchased or manufactured, in each case in respect of the
conduct of the Rolling Business on or prior to the Closing Date;
(vi) all Liabilities under Environmental Laws relating to or
arising out of (A) Hazardous Material transported from the Ravenswood
Real Property pre-Closing; (B) any off-site migration of Hazardous
Material resulting from any pre-Closing off-site disposal or Release of
such Hazardous Material; (C) any off-site migration of Hazardous
Material from the Ravenswood Real Property resulting from any
pre-Closing disposal or Release at the Ravenswood Real Property, except
(I) in respect of matters set forth in Section 3.16(a) of the
Disclosure Schedule, if the Purchaser's actions or inactions are the
cause of such off-site migration or (II) in respect of any other
pre-Closing disposal or Release at the Ravenswood Real Property, if the
Purchaser's negligence is the cause of such off-site migration; and (D)
any on-site PCB contamination existing or occurring on
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or before the Closing at the Ravenswood Real Property, or any off-site
PCB contamination, whether existing or occurring before or after the
Closing, resulting from or arising out of operations at the Ravenswood
Real Property on or before the Closing, in each case requiring
investigation or remediation or other action under applicable
Environmental Law; it being understood that for purposes of this clause
2.02(b)(vi)(D), "Environmental Laws" include regulations adopted by the
State of West Virginia or a subdivision thereof after the Closing Date
pursuant to statutes enacted before the Closing Date;
(vii) all Liabilities in respect of the Oracle GEMMS software
and any claims in respect thereof; and
(viii) any Indebtedness (other than obligations under
equipment leases that have, or should have, been recorded as capital
leases) of the Rolling Business.
SECTION 2.03. Purchase and Sale of Shares. On the terms and
subject to the conditions of this Agreement, on the Closing Date, Century shall
sell to the Purchaser, and the Purchaser shall purchase from Century, all the
Shares. The sale and purchase of the Shares shall not be consummated unless the
sale and purchase of the Rolling Assets is consummated simultaneously, nor shall
the sale and purchase of the Rolling Assets be consummated unless the sale and
purchase of the Shares is consummated simultaneously.
SECTION 2.04. Purchase Price; Allocation of Purchase Price.
(a) Subject to the adjustments set forth in Sections 2.08 and 2.09, the purchase
price for the Rolling Assets and the Shares shall be U.S.$247,000,000, and the
purchase price for the covenants contained in Section 5.07 shall be
U.S.$1,000,000 (collectively, the "PURCHASE PRICE"). Within thirty (30) calendar
days following the date hereof, the Sellers and the Purchaser shall agree to
allocate between the Rolling Assets and the Shares, in accordance with the
respective fair market values of the Rolling Assets and the assets of Century
CP, the portion of the Purchase Price not allocated to the covenants contained
in Section 5.07. Under no circumstances, will the allocations between the
Rolling Assets and the Shares be inconsistent with the allocations set forth
under Section 7.07(b) of this Agreement.
(b) Within sixty (60) calendar days following the Closing, the
Purchaser shall prepare and deliver to the Sellers an allocation statement (the
"ALLOCATION STATEMENT"), setting forth the allocation of the Purchase Price
among the Rolling Assets and any related liability in accordance with Section
1060 of the Code. If, within 30 calendar days after the date of the Purchaser's
delivery of the Form 8594, the Sellers reasonably dispute one or more of the
computations and allocations reflected on the Form 8594, the Sellers will give
written notice to the Purchaser setting forth the computations and allocations
that the Sellers believe should be reflected on Form 8594, and the Sellers and
the Purchaser will attempt in good faith to promptly agree on a revised Form
8594. If the parties cannot resolve any such dispute within 30 Business Days of
the delivery by the Purchaser of the Form 8594 to the Sellers, the items
remaining in dispute shall be submitted to an independent accounting firm of
international reputation selected by, and mutually acceptable to, the Sellers
and the Purchaser. If the independent accounting firm so selected determines
that the allocation with respect to any item or items remaining in dispute
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is incorrect and that the Sellers would be materially adversely affected by the
incorrectness of such allocation, then the Sellers and the Purchaser shall be
bound by the allocation of such items as determined by the independent
accounting firm. Otherwise, the Purchaser and the Sellers shall be bound by the
allocation with respect to such item or items as prepared by the Purchaser. The
independent accounting firm shall make any such determination within 30 Business
Days after submission of the remaining disputed items. Any subsequent
adjustments to the Purchase Price shall be reflected in the Allocation Statement
as revised hereunder in a manner consistent with Treasury Regulation Section
1.1060 1T(f). For all Tax purposes, the Purchaser and the Sellers agree to
report the transactions contemplated in this Agreement in a manner consistent
with the terms of this Agreement, including the allocations under Section
2.04(a), and that none of them will take any position inconsistent therewith in
any Tax return, in any refund claim, in any litigation, or otherwise. Each of
the Sellers and the Purchaser agree to cooperate with each other in preparing
Form 8594 for filing by each and to furnish the other with a copy of such form
prepared in draft within a reasonable period before its filing due date, as well
as copies of such forms as filed.
SECTION 2.05. Closing. Subject to the terms and conditions of
this Agreement, the sale and purchase of the Assets and the assumption of the
Assumed Liabilities contemplated by this Agreement shall take place at a closing
(the "CLOSING") to be held at the offices of Shearman & Sterling, 000 Xxxxxxxxx
Xxxxxx, Xxx Xxxx, Xxx Xxxx at 10:00 A.M. New York time on the later to occur of
(i) September 30, 1999 or (ii) the last Business Day of the month following the
fifth Business Day after the later to occur of the (A) expiration or termination
of all applicable waiting periods under the HSR Act and (B) satisfaction or
waiver of all other conditions to the obligations of the parties set forth in
Article VIII, or at such other place or at such other time or on such other date
as the Sellers and the Purchaser may mutually agree upon in writing (the day on
which the Closing takes place being the "CLOSING DATE").
SECTION 2.06. Closing Deliveries by the Sellers. At the
Closing, the Sellers shall deliver or cause to be delivered to the Purchaser:
(a) the Xxxx of Sale, the Deed and such other instruments, in
form and substance reasonably satisfactory to the Purchaser, as may be
requested by the Purchaser to transfer the Rolling Assets to the
Purchaser or evidence such transfer on the public records;
(b) stock certificates evidencing the Shares duly endorsed in
blank, or accompanied by stock powers duly executed in blank, in form
reasonably satisfactory to the Purchaser and with all required stock
transfer tax stamps affixed;
(c) executed counterparts of the Assumption Agreement, the
Molten Aluminum Purchase Agreement, the Shared Services Agreement, the
Management Services Agreement, the Xxxxxx Indemnity Agreement and the
Ravenswood Indemnity Agreement;
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(d) a receipt for the Purchase Price; and
(e) the certificates, deliveries and other documents required
to be delivered pursuant to Section 8.02.
SECTION 2.07. Closing Deliveries by the Purchaser. At the
Closing, the Purchaser shall deliver to the Sellers:
(a) the Purchase Price by wire transfer in immediately
available funds to an account or accounts designated at least three
Business Days prior to the Closing Date by the Sellers in a written
notice to the Purchaser;
(b) executed counterparts of the Assumption Agreement, the
Molten Aluminum Purchase Agreement, the Shared Services Agreement, the
Management Services Agreement, the Xxxxxx Indemnity Agreement and the
Ravenswood Indemnity Agreement; and
(c) the certificates, deliveries and other documents required
to be delivered pursuant to Section 8.01.
SECTION 2.08. Pre-Closing Adjustment of Purchase Price. (a) On
or around the tenth Business Day preceding the Closing Date, the Sellers shall
in good faith estimate the Net Working Capital as of the last calendar day of
the immediately preceding month (the "SELLERS ESTIMATED NET WORKING CAPITAL")
and deliver to the Purchaser in accordance with Section 11.02 a notice
specifying the Sellers Estimated Net Working Capital and the basis, in
reasonable detail, for such calculation. The Purchaser shall have three Business
Days to review the Sellers Estimated Net Working Capital during which time the
Sellers shall in good faith assist the Purchaser in such review. After such
three Business Day review period shall have terminated, either (i) the parties
shall have, acting in good faith, mutually agreed an estimate of the Net Working
Capital as of the last calendar day of the immediately preceding month (the
"AGREED ESTIMATED NET WORKING CAPITAL") or (ii) the Sellers, on the one hand,
and the Purchaser, on the other hand, shall have, acting in good faith, each
determined an estimate of the Net Working Capital as of the last calendar day of
the immediately preceding month (the determination closest to the Net Working
Capital reflected on the Reference Balance Sheet being hereinafter referred to
as the "DEFAULT ESTIMATED NET WORKING CAPITAL").
(b) Following determination of the Agreed Estimated Net
Working Capital or the Default Estimated Net Working Capital, as the case may
be, the Purchase Price shall be adjusted as follows:
(i) in the event that the Agreed Estimated Net Working Capital
or the Default Estimated Net Working Capital, as the case may be,
exceeds the Net Working Capital reflected on the Reference Balance
Sheet, then the Purchase Price shall be adjusted
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upward by an amount equal to 50% of such excess (the "ADJUSTED
PRE-CLOSING NWC INCREASE"); and
(ii) in the event that the Agreed Estimated Net Working
Capital or the Default Estimated Net Working Capital, as the case may
be, is less than the Net Working Capital reflected on the Reference
Balance Sheet, then the Purchase Price shall be adjusted downward by an
amount equal to 50% of such shortfall (the "ADJUSTED PRE-CLOSING NWC
DECREASE").
SECTION 2.09. Post-Closing Adjustment of Purchase Price. The
Purchase Price shall be subject to adjustment after the Closing as specified in
this Section 2.09:
(a) Closing Balance Sheet. As promptly as practicable, but in
any event within 90 calendar days following the Closing Date, the
Purchaser shall deliver to the Sellers the Closing Balance Sheet,
together with a certificate of the Purchaser thereon that the Closing
Balance Sheet was prepared on a basis consistent with the preparation
of the Reference Balance Sheet.
(b) Disputes. (i) Subject to clause (ii) of this Section
2.09(b), the Closing Balance Sheet delivered by the Purchaser to the
Sellers shall be deemed to be and shall be final, binding and
conclusive on the parties hereto.
(ii) The Sellers may dispute any amounts reflected on the
Closing Balance Sheet to the extent the net effect of such disputed
amounts in the aggregate would affect the Net Working Capital reflected
on the Closing Balance Sheet by more than the Designated Amount, but
only on the basis that the amounts reflected on the Closing Balance
Sheet were not prepared in accordance with the same U.S. GAAP, applied
on a basis consistent with the preparation of the Reference Balance
Sheet; provided, however, that the Sellers shall have notified the
Purchaser in writing of each disputed item, specifying the amount
thereof in dispute and setting forth, in reasonable detail, the basis
for such dispute, within 30 Business Days of the Purchaser's delivery
of the Closing Balance Sheet to the Sellers. In the event of such a
dispute, the Sellers' Accountants and the Purchaser's Accountants shall
attempt to reconcile their differences, and any resolution by them as
to any disputed amounts shall be final, binding and conclusive on the
parties hereto. If any such resolution by the Purchaser's Accountants
and the Sellers' Accountants leaves in dispute amounts the net effect
of which in the aggregate would not affect the Net Working Capital
reflected on the Closing Balance Sheet by more than the Designated
Amount, all such amounts remaining in dispute shall then be deemed to
have been resolved in favor of the Closing Balance Sheet delivered by
the Purchaser to the Sellers. If the Sellers' Accountants and the
Purchaser's Accountants are unable to reach a resolution with such
effect within 20 Business Days after receipt by the Purchaser of the
Sellers' written notice of dispute, the Sellers' Accountants and the
Purchaser's Accountants shall submit the items remaining in dispute for
resolution to an independent accounting firm of international
reputation mutually acceptable to the Purchaser and the
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Sellers (the "INDEPENDENT ACCOUNTING FIRM"), which shall, within 60
Business Days after such submission, determine and report to the
Purchaser and the Sellers upon such remaining disputed items, and such
report shall be final, binding and conclusive on the Sellers and the
Purchaser. The fees and disbursements of the Independent Accounting
Firm shall be allocated between the Sellers and the Purchaser in the
same proportion that the aggregate amount of such remaining disputed
items so submitted to the Independent Accounting Firm that is
unsuccessfully disputed by each such party (as finally determined by
the Independent Accounting Firm) bears to the total amount of such
remaining disputed items so submitted.
(iii) In acting under this Agreement, the Purchaser's
Accountants, the Sellers' Accountants and the Independent Accounting
Firm shall be entitled to the privileges and immunities of arbitrators.
(iv) No adjustment to the Purchase Price pursuant to Section
2.09(c) shall be made with respect to amounts disputed by the Sellers
pursuant to this Section 2.09(b), unless the net effect of the amounts
successfully disputed by the Sellers in the aggregate is to increase
the Net Working Capital reflected on the Closing Balance Sheet by at
least the Designated Amount.
(c) Purchase Price Adjustment. The Closing Balance Sheet shall
be deemed final for the purposes of this Section 2.09 upon the earlier
of (A) the failure of the Sellers to notify the Purchaser of a dispute
within 30 Business Days of the Purchaser's delivery of the Closing
Balance Sheet to the Sellers, (B) the resolution of all disputes,
pursuant to Section 2.09(b)(ii), by the Purchaser's Accountants and the
Sellers' Accountants and (C) the resolution of all disputes, pursuant
to Section 2.09(b)(ii), by the Independent Accounting Firm. Subject to
the limitation set forth in Section 2.09(b)(iv), within three Business
Days of the Closing Balance Sheet being deemed final, a Purchase Price
adjustment shall be made as follows:
(i) In the event that the Adjusted Reference Net
Working Capital exceeds the Net Working Capital reflected on
the Closing Balance Sheet by at least the Designated Amount,
then the Purchase Price shall be adjusted downward in an
amount equal to the full amount by which the Adjusted
Reference Net Working Capital exceeds the Net Working Capital
shown on the Closing Balance Sheet, the Purchaser shall
deliver written notice to the Sellers specifying the amount of
such downward adjustment of the Purchase Price, and the
Sellers shall, within three Business Days of their receipt of
such notice, pay such amount to the Purchaser in immediately
available funds.
(ii) In the event that the Net Working Capital
reflected on the Closing Balance Sheet exceeds the Adjusted
Reference Net Working Capital by at least the Designated
Amount, then the Purchase Price shall be adjusted upward in an
amount equal to the full amount by which the Net Working
Capital shown on
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the Closing Balance Sheet exceeds the Adjusted Reference Net
Working Capital and the Purchaser shall, within three Business
Days of such determination, pay the amount of such excess to
the Sellers by wire transfer in immediately available funds.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
OF THE SELLERS
As an inducement to the Purchaser to enter into this
Agreement, the Sellers hereby represent and warrant, jointly and severally, to
the Purchaser as follows:
SECTION 3.01. Organization, Authority and Qualification of the
Sellers. Each of the Sellers is a corporation duly organized, validly existing
and in good standing under the laws of the State of Delaware and has all
necessary power and authority to enter into this Agreement and the Ancillary
Agreements to which it is a party, to carry out its obligations hereunder and
thereunder and to consummate the transactions contemplated hereby and thereby.
Each of the Sellers is duly licensed or qualified to do business and is in good
standing in each jurisdiction in which the properties owned or leased by it or
the operation of its business makes such licensing or qualification necessary,
except to the extent that the failure to be so licensed or qualified would not
adversely affect (i) the ability of such Seller to carry out its obligations
under, and to consummate the transactions contemplated by, this Agreement and
the Ancillary Agreements to which it is a party and (ii) the ability of the
Sellers and the Subsidiaries to conduct the Business in any material respect.
The execution and delivery by each of the Sellers of this Agreement and the
Ancillary Agreements to which it is a party, the performance by each of the
Sellers of its obligations hereunder and thereunder and the consummation by each
of the Sellers of the transactions contemplated hereby and thereby have been
duly authorized by all requisite action on the part of each of the Sellers. This
Agreement has been, and upon their execution the Ancillary Agreements will be,
duly executed and delivered by each of the Sellers that is a party thereto, and
(assuming due authorization, execution and delivery by the Purchaser) this
Agreement constitutes, and upon their execution the Ancillary Agreements to
which each Seller is a party will constitute, legal, valid and binding
obligations of such Seller enforceable against such Seller in accordance with
their respective terms.
SECTION 3.02. Capital Stock and Ownership. (a) Century owns
all of the authorized, issued and outstanding shares of capital stock of Century
WV (the "CENTURY WV SHARES") free and clear of all Encumbrances. There are no
options, warrants, convertible securities or other rights, agreements,
arrangements or commitments of any character relating to the capital stock of
Century WV or obligating either Century WV or Century to issue or sell any
shares of capital stock of, or other interest in, Century WV.
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(b) The Shares constitute all the authorized, issued and
outstanding shares of capital stock of Century CP. The Shares have been duly
authorized and validly issued and are fully paid and nonassessable. None of the
issued and outstanding shares of Common Stock was issued in violation of any
preemptive rights. There are no options, warrants, convertible securities or
other rights, agreements, arrangements or commitments of any character relating
to the capital stock of Century CP or obligating either Century CP or Century to
issue or sell any shares of capital stock of, or other interest in, Century CP.
There are no outstanding contractual obligations of Century CP to repurchase,
redeem or otherwise acquire any shares of Common Stock or to provide funds to,
or make any investment (in the form of a loan, capital contribution or
otherwise) in, any other Person. The Shares are owned of record and beneficially
by Century free and clear of all Encumbrances. Upon consummation of the
transactions contemplated by this Agreement, the Purchaser will own all the
issued and outstanding capital stock of Century CP, free and clear of all
Encumbrances, and the Shares will be fully paid and nonassessable. There are no
voting trusts, stockholder agreements, proxies or other agreements or
understandings in effect with respect to the voting or transfer of any of the
Shares.
SECTION 3.03. Subsidiaries. (a) Century CP owns, whether of
record or beneficially, no direct or indirect equity or other interest in any
corporation, partnership, joint venture, association or other entity or any
right (contingent or otherwise) to acquire the same. Century CP is not a member
of (nor is any part of the Business conducted through) any partnership, nor is
Century CP a participant in any joint venture or similar arrangement.
(b) Century CP: (i) is a corporation duly organized and
validly existing under the laws of its jurisdiction of incorporation, (ii) has
all necessary power and authority to own, operate or lease the properties and
assets owned, operated or leased by it and to carry on its business as it has
been and is currently conducted and (iii) is in all material respects duly
licensed or qualified to do business and is in good standing in each
jurisdiction in which the properties owned or leased by it or the operation of
its business makes such licensing or qualification necessary or desirable.
(c) All material corporate actions taken by Century CP have
been duly authorized and it has taken no material action that conflicts with,
constitutes a default under or results in a violation of any provision of its
charter or By-laws (or similar organizational documents). True and complete
copies of the charter and By-laws (or similar organizational documents), in each
case as in effect on the date hereof, of Century CP have been delivered by the
Sellers to the Purchaser.
SECTION 3.04. Books and Records. The minute books of Century
CP contain in all material respects accurate records of all meetings and
accurately reflect in all material respects all other actions taken by the
stockholders, Board of Directors and all committees of the Board of Directors of
Century CP. Complete and accurate copies of all such minute books of Century CP
and of the stock register of Century CP have been provided by the Sellers to the
Purchaser. Complete and accurate copies of all minute books of meetings held
since January 1, 1996 of the stockholders, Boards of Directors, and all
committees thereof, of the Sellers, which
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contain references to matters material, or which with the passage of time could
reasonably be expected to become material, to the Business, have been provided
by the Sellers to the Purchaser (but only to the extent of discussions of such
matters).
SECTION 3.05. No Conflict. Except as may result from any facts
or circumstances relating solely to the Purchaser or as described in Section
3.06, the execution, delivery and performance by each of the Sellers of this
Agreement and the Ancillary Agreements to which it is a party do not and will
not (a) violate, conflict with or result in the breach of any provision of the
charter or By-laws (or similar organizational documents) of any of the Sellers
or Century CP, (b) materially conflict with or violate (or cause an event which
would be reasonably likely to have a Material Adverse Effect as a result of) any
Law or Governmental Order applicable to any of the Sellers, Century CP or any of
their respective assets, properties or businesses or (c) except as set forth in
Section 3.05(c) of the Disclosure Schedule or as would not be reasonably likely
to have, individually or in the aggregate, a Material Adverse Effect, conflict
with, result in any breach of, constitute a default (or event which with the
giving of notice or lapse of time, or both, would become a default) under,
require any consent under, or give to others any rights of termination,
amendment, acceleration, suspension, revocation or cancellation of, or result in
the creation of any Encumbrance on any of the Rolling Assets or the assets or
properties of Century CP pursuant to, any note, bond, mortgage or indenture,
contract, agreement, lease, sublease, license, permit, franchise or other
instrument or arrangement to which any of the Sellers or Century CP is a party
or by which any of such assets or properties is bound or affected.
SECTION 3.06. Governmental Consents and Approvals. The
execution, delivery and performance by each of the Sellers of this Agreement and
each Ancillary Agreement to which it is a party does not and will not require
any consent, approval, authorization or other order of, action by, filing with
or notification to, any Governmental Authority, except (a) as described in
Section 3.06 of the Disclosure Schedule and (b) the requirements of the HSR Act.
SECTION 3.07. Financial Information; Books and Records. (a)
True and complete copies of the Reference Balance Sheet and the related
statement of operations of the Business (collectively referred to herein as the
"FINANCIAL STATEMENTS") have been delivered by the Sellers to the Purchaser.
Except as set forth in Section 3.07(a) of the Disclosure Schedule, the Financial
Statements (i) were prepared in all material respects from the books of account
and other financial records of the Sellers and Century CP, (ii) present fairly
in all material respects the financial condition and results of operations of
the Business as of the dates thereof or for the periods covered thereby and
(iii) have been prepared in accordance with the same U.S. GAAP as applied in the
preparation of the consolidated financial statements of Century as of, and for
the year ended, December 31, 1998.
(b) The books of account and other financial records of the
Sellers and Century CP for fiscal years 1997, 1998 and 1999 and, in the case of
Century CP, since its formation in December 1998: (i) fairly present in all
material respects all items of income and expense and all assets and Liabilities
required to be reflected therein in accordance with U.S.
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GAAP applied on a basis consistent with the past practices of the Sellers, and
throughout the periods involved, (ii) are in all material respects complete and
do not contain or reflect any material inaccuracies or discrepancies and (iii)
have been maintained in all material respects in accordance with good business
and accounting practices.
SECTION 3.08. No Undisclosed Liabilities. There are no
Liabilities of the Business, other than Liabilities (i) reflected or reserved
against on the Reference Balance Sheet, (ii) disclosed in Section 3.08 of the
Disclosure Schedule (or as otherwise disclosed in the Disclosure Schedule if the
relevance to this Section 3.08 is reasonably apparent from the facts specified
in such disclosure), (iii) incurred since the date of this Agreement in the
ordinary course of business, consistent with past practice, of the Business and
which do not and would not be reasonably likely to have, individually or in the
aggregate, a Material Adverse Effect or (iv) of a kind and type that would not
be required to be disclosed in a financial statement prepared in accordance with
U.S. GAAP and which do not and would not be reasonably likely to have,
individually or in the aggregate, a Material Adverse Effect. Reserves are
reflected on the Reference Balance Sheet against all Liabilities of the Business
as of the date thereof, other than Liabilities relating to the Excluded
Liabilities, in amounts that have been established on a basis consistent with
the past practices of the Sellers and in accordance with U.S.
GAAP.
SECTION 3.09. Receivables. Section 3.09 of the Disclosure
Schedule is an aged list of the Receivables as of the Reference Balance Sheet
Date showing separately those Receivables that as of such date had been
outstanding (i) for less than the due date, (ii) 1 to 15 days past due, (iii) 16
to 30 days past due, (iv) 31 to 60 days past due and (v) over 60 days past due.
Except to the extent, if any, reserved for on the Reference Balance Sheet, all
Receivables reflected on the Reference Balance Sheet arose in all material
respects from, and the Receivables existing on the Closing Date will have arisen
in all material respects from, the sale of Inventory or services to Persons in
the ordinary course of the Business consistent with past practice and, except as
reserved against on the Reference Balance Sheet, constitute or will constitute
in all material respects, as the case may be, only valid, undisputed claims of
the Business not subject to valid claims of set-off or other defenses or
counterclaims other than normal cash discounts accrued in the ordinary course of
the Business consistent with past practice. All Receivables reflected on the
Reference Balance Sheet or arising from the date thereof until the Closing are,
or will be, reserved for in accordance with the same U.S. GAAP as applied in the
preparation of the consolidated financial statements of Century as of and for
the year ended, December 31, 1998.
SECTION 3.10. Inventories. (a) Subject to amounts reserved
therefor on the Reference Balance Sheet, the values at which all Inventories are
carried on the Reference Balance Sheet reflect the historical inventory
valuation policy of Century WV and Century CP of stating such Inventories at the
lower of cost (determined principally on the last-in, first-out method) or
market value. Except as set forth in Section 3.10 of the Disclosure Schedule and
for Encumbrances described in clause (b) of the definition of "Permitted
Encumbrances", the Business has good and marketable title to the Inventories
free and clear of all Encumbrances. The Inventories do not consist of any items
held on consignment. The Business is not under any obligation or liability with
respect to accepting returns of items of Inventory or merchandise in
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the possession of its customers other than in the ordinary course of the
Business consistent with past practice. No clearance or extraordinary sale of
the Inventories has been conducted since the Reference Balance Sheet Date. The
Business has not acquired or committed to acquire or manufactured Inventory for
sale which is not of a quality and quantity usable in the ordinary course of the
Business within a reasonable period of time and consistent with past practice
nor has the Business changed the price of any Inventory except for (i) price
reductions to reflect any reduction in the cost thereof to the Business, (ii)
reductions and increases responsive to normal competitive conditions and
consistent with the Business' past sales practices, (iii) increases to reflect
any increase in the cost thereof to the Business and (iv) increases and
reductions made with the written consent of the Purchaser. Section 3.10 of the
Disclosure Schedule contains a complete list of the addresses of all warehouses
and other facilities in which the Inventories are located.
(b) The Inventories are in all material respects in a
condition such that they can be sold in the ordinary course of the Business
consistent with past practice. All Inventories reflected in the Reference
Balance Sheet or arising from the date hereof until the Closing are, or will be,
recorded in accordance with the same U.S. GAAP as applied in the preparation of
the consolidated financial statements of Century as of and for the year ended,
December 31, 1998.
SECTION 3.11. Public Filings. None of Century WV or the
Subsidiaries is required to file any forms, reports or other documents with the
SEC.
SECTION 3.12. Sales and Purchase Order Backlog. (a) As of the
Reference Balance Sheet Date, open sales orders accepted by the Business totaled
approximately $117,000,000, and, as of a date not more than ten days prior to
the date hereof, open sales orders accepted by the Business totaled
approximately $126,000,000. Section 3.12(a) of the Disclosure Schedule lists all
sales orders exceeding $100,000 per order, which have been accepted by the
Business, and which were open either as of the Reference Balance Sheet Date or
as of such date not more than ten days prior to the date hereof.
(b) As of the Reference Balance Sheet Date, open purchase
orders issued by the Business totaled approximately $17,000,000, and, as of the
date referred to in Section 3.12(a) not more than ten days prior to the date
hereof, open purchase orders issued by the Business totaled approximately
$15,000,000. Section 3.12(b) of the Disclosure Schedule lists all purchase
orders exceeding $100,000 per order, which have been issued by the Business, and
which were open either as of the Reference Balance Sheet Date or as of such date
not more than ten days prior to the date hereof.
SECTION 3.13. Conduct in the Ordinary Course; Absence of
Certain Changes, Events and Conditions. Since the Reference Balance Sheet Date,
except as disclosed in Section 3.13 of the Disclosure Schedule, the Business has
been conducted in the ordinary course and consistent with past practice. As
amplification and not limitation of the foregoing, except as disclosed in
Section 3.13 of the Disclosure Schedule and except as would not, individually or
in
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the aggregate, be reasonably likely to have a Material Adverse Effect, since the
Reference Balance Sheet Date, none of the Sellers or Century CP has:
(a) permitted or allowed any of the assets or properties
(whether tangible or intangible) of the Business to be subjected to any
Encumbrance, other than Permitted Encumbrances and Encumbrances that
will be released at or prior to the Closing;
(b) except in the ordinary course of the Business consistent
with past practice, discharged or otherwise obtained the release of any
Encumbrance relating to the Business or paid or otherwise discharged
any Liability of the Business, other than current liabilities reflected
on the Reference Balance Sheet and current liabilities incurred in the
ordinary course of the Business consistent with past practice since the
date of the Reference Balance Sheet;
(c) written down or written up (or failed to write down or
write up) the value of any Inventories or Receivables or revalued any
assets of the Business other than in the ordinary course of the
Business consistent with past practice and in accordance with the same
U.S. GAAP as applied in the preparation of the consolidated financial
statements of Century as of and for the year ended, December 31, 1998;
(d) made any change in any method of accounting or accounting
practice or policy related to the Business, other than such changes
required by U.S. GAAP;
(e) amended, terminated, canceled or compromised any material
claims of the Business or waived any other rights of substantial value
to the Business;
(f) sold, transferred, leased, subleased, licensed or
otherwise disposed of any properties or assets, real, personal or mixed
(including, without limitation, leasehold interests and intangible
property), other than in the ordinary course of the Business consistent
with past practice;
(g) issued or sold any capital stock, notes, bonds or other
securities, or any option, warrant or other right to acquire the same,
of Century CP;
(h) redeemed any of the capital stock of Century CP or
declared, made or paid any dividends or distributions (whether in cash,
securities or other property) to the holders of Century CP's capital
stock;
(i) in relation to Century CP or the Business, merged with,
entered into a consolidation with or acquired an interest of 5% or more
in any Person or acquired a substantial portion of the assets or
business of any Person or any division or line of business thereof, or
otherwise acquired any material assets other than in the ordinary
course of the Business consistent with past practice;
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(j) made any commitment for any capital expenditure in respect
of the Business that will not be expended as of the Closing Date in
excess of $1,000,000 in the aggregate;
(k) made any material changes in the customary methods of
operations of the Business, including, without limitation, practices
and policies relating to manufacturing, purchasing, marketing, selling
and pricing;
(l) made any express or deemed election or settled or
compromised any liability, with respect to Taxes of the Business;
(m) in the case of Century CP, incurred any Indebtedness
which will not be repaid in full prior to Closing, except for
obligations under letters of credit or in respect of bonds posted in
the ordinary course of business consistent with past practice;
(n) in the case of Century CP, made any loan to, guaranteed
any Indebtedness of or otherwise incurred any Indebtedness on behalf of
any Person;
(o) failed in any material respect to pay any creditor any
amount owed to such creditor when due;
(p) (A) established or increased or promised to increase the
benefits under any bonus, insurance, severance, deferred compensation,
pension, retirement, profit sharing, stock option (including, without
limitation, the granting of stock options, stock appreciation rights,
performance awards or other restricted stock awards), stock purchase or
other employee benefit plan or otherwise increased or promised to
increase the compensation payable or to become payable to any
directors, officers or employees of the Business, or (B) paid any
benefit not required by any plan or agreement as in effect as of the
date hereof; in either case except as required by Law or any collective
bargaining agreement or involving ordinary increases consistent with
the past practice of the Business;
(q) entered into any employment or severance agreement with
any of the employees of the Business;
(r) terminated, discontinued, closed or disposed of any
plant, material facility or other material business operation, or laid
off any employees (other than layoffs in the ordinary course of the
Business consistent with past practice) or implemented any early
retirement, separation or program providing early retirement window
benefits within the meaning of Section 1.401(a)-4 of the Regulations or
announced or planned any such action or program for the future;
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(s) entered into any collective bargaining agreement or
contract with the labor union or collective bargaining representative
without the prior written consent of the Purchaser (other than the New
Collective Bargaining Agreement);
(t) disclosed any material secret or confidential
Intellectual Property (except by way of issuance of a patent) or
permitted to lapse or go abandoned any material Intellectual Property
(or any registration or grant thereof or any application relating
thereto) to which, or under which, the Business has any right, title,
interest or license;
(u) allowed any Material License or material Environmental
Permit that was issued or relates to the Business to lapse or
terminate;
(v) failed to maintain the Business' plants, property and
equipment in good repair and operating condition, as compared to the
condition thereof as of the Reference Balance Sheet Date, ordinary wear
and tear excepted;
(w) suffered any casualty loss or damage with respect to any
of the Rolling Assets or Century CP's properties or assets which in the
aggregate have a replacement cost of more than $500,000, whether or not
such losses or damages shall have been covered by insurance;
(x) amended or restated the charter or By-laws (or other
organizational documents) of Century CP;
(y) suffered any Material Adverse Effect;
(z) entered into any contract or agreement in respect of the
Business (i) between or among the Sellers or any Affiliate of the
Sellers or (ii) with Glencore International AG or any of its
Affiliates;
(aa) (i) amended any policy of the Business relating to the
payment of accounts payable or accounts receivable; (ii) cancelled, or
modified the terms and conditions of payment of, any amounts due the
Business in respect of accounts receivable; or (iii) accelerated, or
modified the terms and conditions of payment of, any amounts payable by
the Business in respect of accounts payable; except in the case of
clauses (i) or (ii), in the ordinary course of business consistent with
past practice; or
(bb) agreed, whether in writing or otherwise, to take any of
the actions specified in this Section 3.13 or granted any options to
purchase, rights of first refusal, rights of first offer or any other
similar rights with respect to any of the actions specified in this
Section 3.13, except as expressly contemplated by this Agreement and
the Ancillary Agreements.
SECTION 3.14. Litigation. Except as set forth in Section 3.14
of the Disclosure Schedule, there are no material Actions by or against the
Business, or affecting any of the
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properties or assets of the Business, including, without limitation, the Assets,
pending before any Governmental Authority (or, to the knowledge of the Sellers,
threatened to be brought by or before any Governmental Authority), provided that
for purposes hereof an Action shall not be deemed material if the sole damages
are monetary and the monetary Liability is less than $250,000. None of the
matters disclosed in Section 3.14 of the Disclosure Schedule, individually or in
the aggregate, has had or would be reasonably likely to have a Material Adverse
Effect or could adversely affect the legality, validity or enforceability of
this Agreement, any Ancillary Agreement or the consummation of the transactions
contemplated hereby or thereby.
SECTION 3.15. Compliance with Laws. Except as set forth in
Section 3.15 of the Disclosure Schedule and except for environmental matters,
real property matters, employee, compensation and benefit matters, labor matters
and tax matters, as to which the provisions of Sections 3.16, 3.19, 3.22, 3.23
and 3.25, respectively, shall apply, the Sellers have conducted and continue to
conduct the Business in all material respects in accordance with all Laws and
Governmental Orders applicable to the Business or any of the properties or
assets of the Business, including, without limitation, the Assets, and the
Business is not in violation of any such Law or Governmental Order in any
material respect.
SECTION 3.16. Environmental Matters. (a) Except as disclosed
in Section 3.16(a) of the Disclosure Schedule:
(i) Each of the Sellers and Century CP is in material
compliance with all applicable Environmental Laws and all Environmental
Permits related to the Business or the Real Property. All noncompliance
with Environmental Laws or Environmental Permits in respect of the
Business in the last three years has been resolved without any material
pending, ongoing or future obligation, cost or liability.
(ii) There are no underground or aboveground storage tanks or
any surface impoundments, septic tanks, pits, sumps or lagoons in which
Hazardous Materials are being or have been treated, stored or disposed
on any of the Real Property, except where the existence thereof would
not be reasonably likely to result in any material Liability.
(iii) None of the Sellers or Century CP has, and to the
knowledge of the Sellers, no other Person has, Released Hazardous
Materials on any of the Real Property in a manner that would be
reasonably likely to result in material Liability.
(iv) None of the Sellers or Century CP is conducting, or has
undertaken or completed, any Remedial Action relating to any Release or
threatened Release at the Real Property currently or formerly owned or
operated by the Sellers or Century CP or at any other off-site location
in respect of the Business, either voluntarily or pursuant to the order
of any Governmental Authority or the requirements of any Environmental
Law or Environmental Permit.
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(v) There is no asbestos or asbestos-containing material on
any of the Real Property.
(vi) To the knowledge of the Sellers, none of the Real
Property is listed or has been proposed for listing on the National
Priorities List or the Comprehensive Environmental Response,
Compensation and Liability Information System under the federal
Comprehensive Environmental Response, Compensation, and Liability Act
or any analogous federal, state or local list.
(vii) There are no material Environmental Claims pending or,
to the knowledge of the Sellers, threatened against (a) any of the
Sellers or Century CP relating to the Business, (b) the Business or (c)
the Real Property, and to the knowledge of the Sellers, there are no
circumstances that can reasonably be expected to form the basis of any
such Environmental Claim in respect of the Business, including without
limitation with respect to any off-site disposal location presently or
formerly used by any of the Sellers or Century CP or any of their
predecessors or with respect to any previously owned or operated
facilities.
(viii) There are no wetlands or any areas subject to any legal
requirement or restriction in any way related to wetlands (including,
without limitation, requirements or restrictions related to buffer or
transition areas or open waters) at or affecting the Real Property.
(b) The Sellers have provided the Purchaser the opportunity to
review copies of any environmental assessment or audit reports or other material
studies or analyses in their possession relating to the Business or the Real
Property (excluding routine in-house reporting, monitoring and correspondence).
(c) Except as disclosed in Section 3.16(c) of the Disclosure
Schedule, and for notices, petitions and filings as may be required for the
transfer of Environmental Permits to the Purchaser or, if such transfer is not
permitted under applicable Law, for the Purchaser to obtain such Permits,
neither the execution of this Agreement nor the consummation of the transactions
contemplated herein will require any Remedial Action or notice to or consent of
Governmental Authorities or third parties pursuant to any applicable
Environmental Law or Environmental Permit.
(d) For avoidance of doubt, the Sellers shall, in respect of
the Ravenswood Real Property, retain, and in respect of the Xxxxxx Owned Real
Property, hold the Purchaser harmless for, all Liabilities relating to or
arising from (i) Hazardous Material transported from the Real Property
pre-Closing; (ii) any off-site migration of Hazardous Material resulting from
any pre-Closing off-site disposal or Release of such Hazardous Material; (iii)
any off-site migration of Hazardous Material from the Real Property resulting
from any pre-Closing disposal or Release at the Real Property, except (I) in
respect of matters set forth in Section 3.16(a) of the Disclosure Schedule, if
the Purchaser's actions or inactions are the cause of such off-site
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migration or (II) in respect of any other pre-Closing disposal or Release at the
Real Property, if the Purchaser's negligence is the cause of such off-site
migration; and (iv) any on-site PCB contamination existing or occurring on or
before the Closing at the Real Property, or any off-site PCB contamination,
whether existing or occurring before or after the Closing, resulting from or
arising out of operations at the Real Property on or before the Closing, in each
case requiring investigation or remediation or other action under applicable
Environmental Law; it being understood that for purposes of this clause
3.16(d)(iv), "Environmental Laws" include regulations adopted by the State of
West Virginia or the State of California, as the case may be, or a subdivision
thereof, after the Closing Date pursuant to statutes enacted before the Closing
Date.
(e) For avoidance of doubt, notwithstanding anything to the
contrary contained in Section 3.16(a) of the Disclosure Schedule, the Purchaser
shall also be indemnified for environmental matters to the extent provided in
the Ravenswood Indemnity Agreement and the Xxxxxx Indemnity Agreement.
(f) Section 3.16(f) of the Disclosure Schedule lists all
Environmental Permits used or held in the conduct of the Business.
(g) Except as disclosed in Section 3.16(g) of the Disclosure
Schedule, to the knowledge of the Sellers, no PCBs have been Released at, on or
beneath any of the Real Property or are migrating to or from any of the Real
Property; it being understood, for avoidance of doubt, that the requirement of
disclosure under this Section 3.16(g) is not intended to alter the allocation of
liability with respect to PCBs as otherwise provided for in this Agreement.
SECTION 3.17. Material Contracts. (a) Section 3.17(a) of the
Disclosure Schedule lists each of the following contracts and agreements
(including, without limitation, oral and informal arrangements) of the Sellers
or Century CP in respect of the Business (such contracts and agreements,
together with all contracts, agreements, leases and subleases concerning the
management or operation of any Real Property (including, without limitation,
brokerage contracts) listed or otherwise disclosed in Section 3.19(a) or 3.19(b)
of the Disclosure Schedule to which any Seller or Century CP is a party and all
agreements relating to Intellectual Property set forth in Section 3.18(a) of the
Disclosure Schedule, being "MATERIAL CONTRACTS"):
(i) each contract, agreement, invoice, purchase order and
other arrangement, for the purchase of Inventory, spare parts, other
materials or personal property with any supplier or for the furnishing
of services to the Business under the terms of which the Business is
likely to pay or otherwise give consideration of more than $500,000 in
the aggregate over the remaining term of such contract;
(ii) each contract, agreement, invoice, sales order and other
arrangement, for the sale of Inventory or other personal property or
for the furnishing of services by the Business which is likely to
involve consideration of more than $500,000 in the aggregate over the
remaining term of such contract;
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(iii) all material broker, distributor, dealer, manufacturer's
representative, franchise, agency, sales promotion contracts and
agreements, and all material market research, marketing consulting and
advertising contracts and agreements;
(iv) all material contracts and agreements in respect of the
Business with any Governmental Authority;
(v) all employment, termination, severance or consulting
contracts or agreements with a current employee or former employee or
current or former director of or consultant of the Business that is not
terminable at will by the employer;
(vi) all collective bargaining agreements or contracts
relating to the Business with any labor union;
(vii) all contracts and agreements that limit the ability of
the Business to compete in any line of business or with any Person or
in any geographic area or during any period of time;
(viii) all contracts, agreements, xxxxxx and other
arrangements in respect of the Business (A) between or among the
Sellers or any Affiliate of the Sellers, (B) with Glencore
International AG or any of its Affiliates or (C) relating to and
between the Business and the Reduction Facility;
(ix) all contracts and agreements for the provision of
utilities (including, without limitation, electricity, gas and
conversion services) to the Business;
(x) all contracts and agreements with Xxxxxx Aluminum &
Chemical Corporation ("KAISER") or Aluminum Company of America
("ALCOA") or any of their Affiliates pursuant to which Kaiser or Alcoa
has agreed to indemnify the Sellers or Century CP in respect of the
Business, pursuant to which the Business may be liable to Kaiser or
Alcoa or pursuant to which Kaiser or Alcoa would have Liabilities owing
to the Business;
(xi) all contracts and agreements related to the provision of
services pursuant to any employee health or welfare benefit plans; and
(xii) all other contracts and agreements, whether or not made
in the ordinary course of the Business, the absence of which,
individually or in the aggregate, would be reasonably likely to have a
Material Adverse Effect.
For purposes of this Section 3.17 and Sections 3.19 and 3.20, the term "LEASE"
shall include any and all leases, subleases, sale/leaseback agreements or
similar arrangements.
(b) Except as disclosed in Section 3.17(b) of the Disclosure
Schedule, each Material Contract s valid and binding on the Sellers and/or
Century CP, as the case may be, and is in all material respects in full force
and effect. None of the Sellers or Century CP is in any
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material respect in breach of, or default under, any Material Contract. The
failure to obtain any consents or waivers in respect of the Material Contracts
in connection with the execution, delivery and consummation of this Agreement
will not, individually or in the aggregate, have a Material Adverse Effect.
(c) Except as disclosed in Section 3.17(c) of the Disclosure
Schedule, to the knowledge of the Sellers, no other party to any Material
Contract is in any material respect in breach thereof or default thereunder.
(d) Alcoa and its Affiliates have fully performed all their
obligations under the Transition Services Agreement dated as of December 31,
1998 between Century and Alcoa, and have no further Liabilities to the Business
under such Agreement.
SECTION 3.18. Intellectual Property. (a) Section 3.18(a)(i) of
the Disclosure Schedule sets forth a true and complete list and a brief
description of all material Owned Intellectual Property and Section 3.18(a)(ii)
of the Disclosure Schedule sets forth a true and complete list and a brief
description of all material Licensed Intellectual Property. Except as disclosed
in Section 3.18(a)(iii) of the Disclosure Schedule, the rights of the Sellers or
Century CP in or to such material Owned Intellectual Property or, to the
knowledge of the Sellers, such material Licensed Intellectual Property do not in
any material respect conflict with or infringe on the rights of any other Person
and none of the Sellers or Century CP has received any claim or written notice
from any Person to such effect.
(b) Except as disclosed in Section 3.18(b) of the Disclosure
Schedule: (i) all the material Owned Intellectual Property is owned by a Seller
or Century CP, as the case may be, free and clear of any Encumbrance, (ii) no
material Actions have been made or asserted or are pending (nor, to the
knowledge of the Sellers has any such Action been threatened) against a Seller
or Century CP either (A) based upon or challenging or seeking to deny or
restrict the use by the Business of any of the Owned Intellectual Property or
(B) alleging that any services provided, or products manufactured or sold by the
Business are being provided, manufactured or sold in violation of any patents or
trademarks, or any other rights of any Person and (iii) to the knowledge of the
Sellers, no Person is using any patents, copyrights, trademarks, service marks,
trade names, trade secrets or similar property that are confusingly similar to
the material Owned Intellectual Property or that infringe upon the material
Owned Intellectual Property or upon the rights of the Sellers or Century CP
therein. Except as disclosed in Section 3.18(b) of the Disclosure Schedule, none
of the Sellers or any of their Affiliates has granted any license or other right
to any other Person with respect to the material Owned Intellectual Property.
The consummation of the transactions contemplated by this Agreement and the
Ancillary Agreements will not result in the termination or material impairment
of any of the material Owned Intellectual Property.
(c) The Sellers have, or have caused to be, delivered to the
Purchaser correct and complete copies of all licenses and sublicenses for
Licensed Intellectual Property set forth in Section 3.18(a)(ii) of the
Disclosure Schedule and any and all ancillary documents pertaining thereto
(including, but not limited to, all amendments, consents and evidence of
commencement
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dates and expiration dates). With respect to each of such material licenses and
material sublicenses:
(i) any such license or sublicense, together with all
ancillary documents delivered pursuant to the first sentence of this
Section 3.18(c), is legal, valid, binding, enforceable and in full
force and effect and represents the entire agreement between the
respective licensor and licensee with respect to the subject matter of
such license or sublicense;
(ii) except as otherwise disclosed in Section 3.18(a)(ii) of
the Disclosure Schedule, with respect to each such license or
sublicense: (A) none of the Sellers or Century CP has received any
notice of cancellation or termination under such license or sublicense,
(B) none of the Sellers or Century CP has received any notice of a
breach or default under such license or sublicense, which breach or
default has not been cured, and (C) none of the Sellers or Century CP
has granted to any other Person any rights, adverse or otherwise, under
such license or sublicense;
(iii) none of the Sellers, Century CP or (to the knowledge of
the Sellers) any other party to any such license or sublicense, is in
material breach or default, and, to the knowledge of the Sellers, no
event has occurred that, with notice or lapse of time would constitute
such a breach or default or permit termination, modification or
acceleration under such license or sublicense;
(iv) no Actions have been made or asserted or are pending
(nor, to the knowledge of the Sellers has any such Action been
threatened) against a Seller or Century CP either (A) based upon or
challenging or seeking to deny or restrict the use by the Business of
any of the material Licensed Intellectual Property or (B) alleging that
any material Licensed Intellectual Property is being licensed,
sublicensed or used in violation of any patents or trademarks, or any
other rights of any Person; and
(v) to the knowledge of the Sellers, no Person is using any
patents, copyrights, trademarks, service marks, trade names, trade
secrets or similar property that are confusingly similar to the
material Licensed Intellectual Property or that infringe upon the
material Licensed Intellectual Property or upon the rights of the
Sellers or Century CP therein.
(d) Except as disclosed in Section 3.18(d) of the Disclosure
Schedule, (i) all rights of the Sellers and Century CP in each item of material
Owned Intellectual Property or material Licensed Intellectual Property are
transferable to the Purchaser as herein contemplated, and (ii) as a result of
the transactions contemplated hereby, upon the Closing, the Purchaser shall own
or possess, or own or possess adequate and enforceable licenses, sublicenses or
other rights to use, without payment of any fee, all such material Owned
Intellectual Property or such material Licensed Intellectual Property.
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(e) The Owned Intellectual Property and the Licensed
Intellectual Property constitute all the Intellectual Property used or held in
the conduct of the Business.
SECTION 3.19. Real Property. (a) Section 3.19(a) of the
Disclosure Schedule lists: (i) the location of Owned Real Property, (ii) the
current owner of such Owned Real Property, (iii) information relating to the
recordation of the deed of each parcel of Owned Real Property and (iv) the
current use of each such parcel of Owned Real Property.
(b) Section 3.19(b) of the Disclosure Schedule lists: (i) the
street address of each parcel of Leased Real Property, (ii) the identity of the
lessor, lessee and current occupant (if different from lessee) of each such
parcel of Leased Real Property, and (iii) the term (referencing applicable
renewal periods) and rental payment terms of the leases (and any subleases)
pertaining to each such parcel of Leased Real Property.
(c) Except as described in Section 3.19(c) of the Disclosure
Schedule, there is no material violation of any Law (including, without
limitation, any building, planning or zoning Law) relating to any of the Real
Property. The Sellers have made available to the Purchaser true and correct
copies of the deeds for each parcel of Owned Real Property and, to the extent
available, all title reports, surveys, certificates of occupancy, permits, and
other documents relating to or otherwise affecting the Real Property. A Seller
or Century CP, as the case may be, is in peaceful and undisturbed possession of
each parcel of Real Property and there are no contractual or legal restrictions
that preclude or restrict in any material respect the ability to use the
premises for the purposes for which they are currently being used. All existing
water, sewer, steam, gas, electricity, telephone and other utilities required
for the use, occupancy, operation and maintenance of the Real Property are
adequate for the conduct of the Business as it has been and currently is
conducted. None of the officers or Senior Managers of the Sellers have actual
knowledge of any physical condition of the Real Property which would prevent the
Business from continuing to be conducted in the manner in which it is presently
being conducted within existing capital and operating budgets taken as a whole.
The parties recognize and agree that portions of the Real Property have been
used in manufacturing operations for more than fifty years, that conditions can
change suddenly and that the preceding sentence shall not constitute in any
manner a representation, warranty or covenant with respect to latent defects or
specific budget items. Except as set forth in Section 3.19(c) of the Disclosure
Schedule, none of the Sellers or Century CP has leased or subleased any portion
of the Real Property to any other Person, nor has any Seller or Century CP
assigned its interest under any lease or sublease listed in Section 3.19(b) of
the Disclosure Schedule to any third party.
(d) The Sellers have, or have caused to be, delivered to the
Purchaser correct and complete copies of all leases and subleases listed in
Section 3.19(b) of the Disclosure Schedule and any and all ancillary documents
pertaining thereto (including, but not limited to, all amendments, consents for
alterations and documents recording variations and evidence of commencement
dates and expiration dates). Except as would not, individually or in the
aggregate, be reasonably likely to have a Material Adverse Effect, with respect
to each of such leases and subleases:
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(i) such lease or sublease, together with all ancillary
documents delivered pursuant to the first sentence of this Section
3.19(d), is legal, valid, binding, enforceable and in full force and
effect and represents the entire agreement between the respective
landlord and tenant with respect to such property;
(ii) except as otherwise disclosed in Section 3.19(b) of the
Disclosure Schedule, with respect to each such lease or sublease: (A)
none of the Sellers or Century CP has received any notice of
cancellation or termination under such lease or sublease, and (B) none
of the Sellers or Century CP has received any notice of a breach or
default under such lease or sublease, which breach or default has not
been cured; and
(iii) none of the Sellers, Century CP or (to the knowledge of
the Sellers any other party to such lease or sublease, is in breach or
default in any material respect, and, to the knowledge of the Sellers,
no event has occurred that, with notice or lapse of time would
constitute such a breach or default or permit termination, modification
or acceleration under such lease or sublease.
(e) There are no condemnation proceedings or eminent domain
proceedings of any kind pending or, to the knowledge of the Sellers, threatened
against the Real Property.
(f) All the Real Property is occupied under a valid and
current certificate of occupancy or similar permit and, to the knowledge of the
Sellers, except for such consents that may be required from Office Lease
landlords with respect to any assignment to the Purchaser of the Office Leases,
there are no facts that would prevent the Real Property from being occupied
after the Closing in the same manner as immediately prior to the Closing.
(g) All improvements on the Real Property constructed by or on
behalf of the Sellers or Century CP or, to the knowledge of the Sellers,
constructed by or on behalf of any other Person were constructed in compliance
with all applicable Laws (including, but not limited to, any building, planning
or zoning Laws) affecting such Real Property and Leased Real Property, except
for failures to comply that would not be reasonably likely to result in a
Material Adverse Effect.
(h) No improvements on the Real Property and none of the
current uses and conditions thereof violate any applicable deed restrictions or
other applicable covenants, restrictions, agreements, existing site plan
approvals, zoning or subdivision regulations or urban redevelopment plans as
modified by any duly issued variances, and no permits, licenses or certificates
pertaining to the ownership or operation of all improvements on the Real
Property, other than those which are transferable with the Real Property, are
required by any Governmental Authority having jurisdiction over the Real
Property, except for violations, and the absence of permits, licenses or
certificates, which would not, individually or in the aggregate, be reasonably
likely to have a Material Adverse Effect.
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(i) Except to the extent contemplated in the Shared Services
Agreement, (i) all improvements on any Real Property are wholly within the lot
limits of such Real Property and do not encroach on any adjoining premises or
easements, and (ii) there are no encroachments on any Real Property by any
improvements located on any adjoining premises, except for Permitted
Encumbrances.
(j) Except as otherwise set forth in Section 3.19(j) of the
Disclosure Schedule, there have been no improvements of a value in excess of
$100,000 in the aggregate made to or construction on any Real Property within
the applicable period for the filing of mechanic's liens.
(k) The rental set forth in each lease or sublease of the
Leased Real Property is the actual rental being paid, and there are no separate
agreements or understandings with respect to the same.
(l) A Seller or Century CP, as the case may be, has, and upon
the Closing the Purchaser will have, the full right to exercise any renewal
options contained in the leases and subleases, if any, pertaining to the Leased
Real Property on the terms and conditions contained therein and upon due
exercise would be entitled to enjoy the use of each Leased Real Property for the
full term of such renewal options.
(m) Seller or Century CP, as the case may be, owns, leases or
has the legal right to use all of the Real Property used in the conduct of the
Business. A Seller or Century CP, as the case may be, has in all material
respects good and marketable title to the Owned Real Property and valid and
subsisting leasehold interests in the material Leased Real Property, free and
clear of all Encumbrances other than Permitted Encumbrances and Permitted
Property Encumbrances.
SECTION 3.20. Assets. (a) Except as disclosed in Section
3.20(a) of the Disclosure Schedule, a Seller or Century CP, as the case may be,
owns, leases or has the legal right to use, in all material respects, all the
properties and assets (except for the Environmental Permits, the contracts
(whether or not Material Contracts), the Owned Intellectual Property and the
Licensed Intellectual Property, the Real Property and the licenses (whether or
not Material Licenses) as to which the provisions of Sections 3.16, 3.17, 3.18,
3.19 and 3.31, respectively, shall apply) and any other tangible personal
property, used in the conduct of the Business or relating to the conduct of the
Business, all of which properties, assets and rights (other than the Excluded
Assets) constitute the "SELECTED BUSINESS ASSETS" and, together with the
Environmental Permits, the contracts (whether or not Material Contracts), the
Owned Intellectual Property and the Licensed Intellectual Property, the Real
Property and the licenses (whether or not Material Licenses) constitute the
"BUSINESS ASSETS". A Seller or Century CP, as the case may be, has in all
material respects good and marketable title to, or, in the case of leased or
subleased Selected Business Assets, valid and subsisting leasehold interests in,
all the Selected Business Assets, free and clear of all Encumbrances, except (i)
as disclosed in Section 3.20(a) of the Disclosure Schedule; and (ii) Permitted
Encumbrances.
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(b) The Business Assets (taken together with the Shared
Services Agreement) constitute all the properties, assets and rights used or
held in, and all such properties, assets and rights as are necessary to the
conduct of, the Business. None of the officers or Senior Managers of the Sellers
have actual knowledge of any physical condition, facts or circumstances relating
to the Business Assets which would prevent the Business from continuing to be
conducted in the manner in which it is presently being conducted within existing
capital and operating budgets taken as a whole. The parties recognize and agree
that portions of the Real Property have been used in manufacturing operations
for up to fifty years, that conditions can change suddenly and that the
preceding sentence shall not constitute in any manner a representation, warranty
or covenant with respect to latent defects or specific budget items.
(c) Except as set forth in Section 3.20(a) or 3.20(c) of the
Disclosure Schedule, the Sellers have the right to sell, assign, transfer,
convey and deliver the Selected Business Assets to the Purchaser without
material penalty or other material adverse consequences. Following the
consummation of the transactions contemplated by this Agreement and the
execution of the instruments of transfer contemplated by this Agreement, the
Purchaser will own, with good, valid and marketable title, or lease, under valid
and subsisting leases, or otherwise acquire the interests of the Sellers in the
Selected Business Assets, free and clear of any Encumbrances, other than
Permitted Encumbrances, and without incurring any material penalty or other
material adverse consequence.
(d) The electric motors of the hot line (including, without
limitation, the rewinders) have the nominal performance specifications,
specified in Section 3.20(d) of the Disclosure Schedule.
SECTION 3.21. Customers. Listed in Section 3.21 of the
Disclosure Schedule are the names and addresses of the ten most significant
customers (by revenue) of the Business for the twelve-month period ended
December 31, 1998 and the amount for which each such customer was invoiced
during such period.
SECTION 3.22. Employee Benefit Matters. (a) Century WV Plans
and Material Documents. Section 3.22(a) of the Disclosure Schedule lists with
respect to the current and former employees, directors or officers of the
Rolling Business (other than any such Person who is currently a director,
officer or employee of Century) (i) all employee benefit plans (as defined in
Section 3(3) of the Employee Retirement Income Security Act of 1974, as amended
("ERISA") and all bonus, stock option, stock purchase, restricted stock,
incentive, deferred compensation, retiree medical or life insurance,
supplemental retirement, severance or other benefit plans, programs or
arrangements, and all employment, termination, severance or other contracts or
agreements, to which any of the Sellers is a party, with respect to which any of
the Sellers has any obligation or which are maintained, contributed to or
sponsored by any of the Sellers, (ii) each employee benefit plan for which any
of the Sellers could incur liability under Section 4069 of ERISA in the event
such plan has been or were to be terminated, (iii) any plan in respect of which
any of the Sellers could incur liability under Section 4212(c) of ERISA and
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(iv) any contracts, arrangements or understandings between a Seller or any of
its Affiliates and any employee of any of the Sellers, including, without
limitation, any contracts, arrangements or understandings relating to a sale of
any Seller (collectively, the "PLANS"). Each Plan is in writing and the Sellers
have furnished the Purchaser with a complete and accurate copy of each Plan and
a complete and accurate copy of each material document prepared in connection
with each such Plan or will furnish such Plan or document prior to the Closing
Date unless otherwise provided in Section 3.22(a) of the Disclosure Schedule,
including, without limitation, (i) a copy of each trust or other funding
arrangement, (ii) each summary plan description, (iii) the most recently filed
IRS Form 5500, (iv) the most recently received IRS determination letter for each
such Plan, if applicable, and (v) the most recently prepared actuarial report
and financial statement in connection with each such Plan if applicable. Except
as disclosed on Section 3.22(a) of the Disclosure Schedule with respect to the
current and former employees, directors or officers of the Rolling Business
(other than any such Person who is currently a director, officer or employee of
Century), there are no other employee benefit plans, programs, arrangements or
agreements, whether formal or informal, whether in writing or not, to which any
of the Sellers or any Subsidiary is a party, with respect to which any of the
Sellers or any Subsidiary has any obligation or which are maintained,
contributed to or sponsored by any of the Sellers or any Subsidiary. With
respect to the Business, none of the Sellers has any express or implied
commitment (i) to create, incur liability with respect to or cause to exist any
other employee benefit plan, program or arrangement, (ii) to enter into any
contract or agreement to provide compensation or benefits to any individual or
(iii) to modify, change or terminate any Plan, other than with respect to a
modification, change or termination required by ERISA or the Code.
(b) Absence of Certain Types of Plans. None of the Plans is a
multiemployer plan (within the meaning of Section 3(37) or 4001(a)(3) of ERISA)
(a "MULTIEMPLOYER PLAN") or a single employer pension plan (within the meaning
of Section 4001(a)(15) of ERISA) for which any of the Sellers could incur
liability under Section 4063 or 4064 of ERISA (a "MULTIPLE EMPLOYER PLAN").
Except as provided in Section 3.22(b) of the Disclosure Schedule, none of the
Plans provides for the payment of separation, severance, termination or
similar-type benefits to any Person or obligates any of the Sellers to pay
separation, severance, termination or similar-type benefits solely as a result
of any transaction contemplated by this Agreement or as a result of a "change in
control", within the meaning of such term under Section 280G of the Code. Except
as provided in Section 3.22(b) of the Disclosure Schedule, none of the Plans
provides for or promises retiree medical, disability or life insurance benefits
to any current or former employee, officer or director of any of Century CP or
the Business. Each of the Plans is subject only to the laws of the United States
or a political subdivision thereof.
(c) Compliance with Applicable Law. Except as otherwise
provided in Section 3.22(c) of the Disclosure Schedule, each Plan is now and
always has been operated in all material respects in accordance with the
requirements of all applicable Law, including, without limitation, ERISA and the
Code, and all persons who participate in the operation of such Plans and all
Plan "fiduciaries" (within the meaning of Section 3(21) of ERISA) have always
acted in all material respects in accordance with the provisions of all
applicable Law, including, without limitation, ERISA and the Code. Each of the
Sellers has performed in all material respects all
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obligations required to be performed by it under, is not in any material respect
in default under or in violation of, and has no knowledge of any material
default or violation by any party to, any Plan. No legal action, suit or claim
is pending or, to Sellers' knowledge, threatened with respect to any Plan (other
than claims for benefits in the ordinary course) and no fact or event exists
that could give rise to any such action, suit or claim.
(d) Qualification of Certain Plans. Except as otherwise
provided in Section 3.22(d) of the Disclosure Schedule, each Plan which is
intended to be qualified under Section 401(a) of the Code or Section 401(k) of
the Code has received a favorable determination letter from the IRS after 1985
that it is so qualified and each trust established in connection with any Plan
which is intended to be exempt from federal income taxation under Section 501(a)
of the Code has received a determination letter from the IRS after 1985 that it
is so exempt, and, to Sellers' knowledge, no material fact or event has occurred
since the date of such determination letter from the IRS to adversely affect the
qualified status of any such Plan or the exempt status of any such trust.
(e) Absence of Certain Liabilities and Events. Except as
disclosed in Section 3.22(e) of the Disclosure Schedule, none of the Sellers has
incurred any liability under, arising out of or by operation of Title IV of
ERISA (other than liability for premiums to the Pension Benefit Guaranty
Corporation arising in the ordinary course), including, without limitation, any
liability in connection with (i) the termination or reorganization of any
employee benefit plan subject to Title IV of ERISA or (ii) the withdrawal from
any Multiemployer Plan or Multiple Employer Plan, and no fact or event exists
which is reasonably likely to give rise to any such liability. No complete or
partial termination has occurred within the five years preceding the date hereof
with respect to any Plan. Except with respect to the transfer of plan assets
contemplated in Section 6.03, or as disclosed in Section 3.22(e) of the
Disclosure Schedule, no reportable event (within the meaning of Section 4043 of
ERISA) has occurred or, to the knowledge of the Sellers, is expected to occur
with respect to any Plan subject to Title IV of ERISA. No Plan had an
accumulated funding deficiency (within the meaning of Section 302 of ERISA or
Section 412 of the Code), whether or not waived, as of the most recently ended
plan year of such Plan. Except as disclosed in Section 3.22(e) of the Disclosure
Schedule, none of the assets of any of the Sellers is the subject of any lien
arising under Section 302(f) of ERISA or Section 412(n) of the Code; none of the
Sellers has been required to post any security under Section 307 of ERISA or
Section 401(a)(29) of the Code; and no fact or event exists which is reasonably
likely to give rise to any such lien or requirement to post any such security.
(f) Plan Contributions and Funding. All contributions,
premiums or payments required to be made with respect to any Plan have been made
on or before their due dates. All such contributions which have been deducted
for income tax purposes have not been challenged or disallowed by any government
entity.
(g) WARN Act. The Sellers and the Subsidiaries are in
compliance with the requirements of the Workers Adjustment and Retraining
Notification Act ("WARN") and have no liabilities pursuant to WARN.
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(h) Century CP Plans. Section 3.22(h) of the Disclosure
Schedule lists each employee welfare benefit or employee pension benefit plan
(individually, each a "CENTURY CP PLAN" and, collectively, "CENTURY CP PLANS")
Century maintains or to which Century contributes or in which the Century CP
employees participate. Each such Century CP Plan (and related trust, insurance
contract, or fund) complies in form and in operation in all material respects
with the applicable requirements of ERISA, the Code and other applicable laws.
SECTION 3.23. Labor Matters. Except as detailed in Section
3.17 of the Disclosure Schedule and the book of grievances which the Sellers
have furnished to the Purchaser, solely in respect of employees engaged in the
Business, (a) none of the Sellers is a party to any collective bargaining
agreement or other labor union contract applicable to persons employed by any of
the Sellers, or in the Business and, to the knowledge of the Sellers, currently
there are no organizational campaigns, petitions or other unionization
activities seeking recognition of a collective bargaining unit which could
affect any of the Sellers; (b) there are no strikes, slowdowns or work stoppages
pending or, to the knowledge of the Sellers, threatened between any of the
Sellers and any of their respective employees, and none of the Sellers has
experienced any such strike, slowdown or work stoppage within the past three
years; (c) none of the Sellers has breached in any material respect or otherwise
failed to comply with the provisions of any collective bargaining or union
contract and there are no written grievances outstanding against any of the
Sellers under any such agreement or contract; (d) there are no unfair labor
practice complaints pending against any of the Sellers before the National Labor
Relations Board or any other Governmental Authority or any current union
representation questions involving employees of any of the Sellers; (e) each of
the Sellers is currently in compliance in all material respects with all
applicable Laws relating to the employment of labor, including those related to
wages, hours, collective bargaining and the payment and withholding of taxes and
other sums as required by the appropriate Governmental Authority and has
withheld and paid to the appropriate Governmental Authority or is holding for
payment not yet due to such Governmental Authority all amounts required to be
withheld from employees of any of the Sellers and is not liable for any arrears
of wages, taxes, penalties or other sums for failure to comply with any of the
foregoing; (f) each of the Sellers has paid in full to all their respective
employees or adequately accrued for in accordance with U.S. GAAP consistently
applied all material wages, salaries, commissions, bonuses, benefits and other
compensation due to or on behalf of such employees; (g) there is no material
claim with respect to payment of wages, salary or overtime pay that has been
asserted or is now pending or threatened before any Governmental Authority with
respect to any Persons currently or formerly employed by any of the Sellers; (h)
none of the Sellers is a party to, or otherwise bound by, any consent decree
with, or citation by, any Governmental Authority relating to employees or
employment practices; (i) there is no charge or proceeding with respect to a
violation of any occupational safety or health standards that has been asserted
or is now pending or threatened with respect to any of the Sellers; and (j)
there is no charge of discrimination in employment or employment practices, for
any reason, including, without limitation, age, gender, race, religion or other
legally protected category, which has been asserted or is now pending or
threatened before the United States Equal Employment Opportunity
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Commission, or any other Governmental Authority in any jurisdiction in which any
of the Sellers has employed or currently employs any such Person.
SECTION 3.24. Century CP Labor and Employment Matters. Except
as set forth in Section 3.24 of the Disclosure Schedule, Century CP is not
subject to any (i) collective bargaining or other labor agreement; or (ii)
employment, retainer, or consulting agreement. The Sellers have not committed,
nor have been notified in writing of any claim to have committed, any unfair
labor practice with respect to Century CP. The Sellers have delivered to the
Purchaser a complete and accurate list of all Century CP employees and their
remuneration. Except as set forth in Section 3.24, as of the date hereof, none
of the Century CP employees has given the Sellers formal notice that he/she
will, or intends to, resign or seek other employment.
SECTION 3.25. Employees. (a) The Sellers have delivered to the
Purchaser a complete and accurate list containing the name, place of employment,
the current annual salary rates, bonuses, deferred or contingent compensation
(whether payable in cash or otherwise), pension, accrued vacation, "golden
parachute" and other like benefits paid or payable (in cash or otherwise), the
date of employment and a description of position and job function of each
current employee listed on Section 6.01 of the Disclosure Schedule engaged in
the Business.
(b) All salaried employees of the Business are now, or will by
the Closing be, under written obligation to a Seller or a Subsidiary to maintain
in confidence all confidential or proprietary information acquired by them in
the course of their employment and to assign to a Seller or a Subsidiary all
inventions made by them in connection within the scope of their employment
during such employment and for a reasonable period thereafter.
SECTION 3.26. Taxes. (a) Except as set forth in Section 3.26
of the Disclosure Schedule: (i) all returns and reports in respect of Taxes
required to be filed as of the date hereof with respect to each of the Sellers
and each Subsidiary and the Business have been timely filed; (ii) all Taxes
shown to be due on such returns and reports have been timely paid; (iii) all
such returns and reports are true, correct and complete in all material
respects; (iv) no adjustment relating to such returns has been proposed formally
or informally by any Tax authority and, to the knowledge of the Sellers, no
basis exists for any such adjustment; (v) there are no pending or, to the
knowledge of the Sellers, threatened actions or proceedings for the assessment
or collection of Taxes against any of the Sellers or any Subsidiary or (insofar
as either relates to the activities or income of any of the Sellers or any
Subsidiary or the Business or could result in liability of any of the Sellers or
any Subsidiary on the basis of joint and/or several liability) any corporation
that was includible in the filing of a return with any of the Sellers on a
consolidated or combined basis; (vi) no consent under Section 341(f) of the Code
has been filed with respect to Century CP; and (vii) there are no Tax liens on
any assets of the Business.
(b) Except as disclosed in Section 3.26 of the Disclosure
Schedule: (i) there are no outstanding waivers or agreements extending the
statute of limitations for any period with respect to any Tax to which any of
the Sellers or any Subsidiary or the Business may be subject; (ii) there are no
requests for information currently outstanding that could affect the Taxes of
any
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of the Sellers, any Subsidiary or the Business; and (iii) to the knowledge of
the Sellers there are no proposed reassessments of any property owned by any of
the Sellers or any Subsidiary or other proposals that could increase the amount
of any Tax to which any of the Sellers, any Subsidiary or the Business would be
subject.
SECTION 3.27. Insurance. Section 3.27 of the Disclosure
Schedule sets forth all insurance coverage of the Sellers with respect to the
Business, and, to the extent available to the Sellers, details for the last
three years of the Business' loss experience with respect to such coverage.
SECTION 3.28. Accounts; Lockboxes; Safe Deposit Boxes; Powers
of Attorney. Section 3.28 of the Disclosure Schedule is a true and complete list
of (i) the names of each bank, savings and loan association, securities or
commodities broker or other financial institution in which the Business (in the
name of a Seller or Century CP) has an account, including cash contribution
accounts, and the names of all persons authorized to draw thereon or have access
thereto, (ii) the location of all lockboxes and safe deposit boxes of the
Business and the names of all Persons authorized to draw thereon or have access
thereto and (iii) the names of all Persons, if any, holding powers of attorney
from the Sellers or Century CP relating to the Business. At the time of the
Closing, none of the Sellers shall have any such account, lockbox or safe
deposit box for use in respect of the Business other than those listed in
Section 3.28 of the Disclosure Schedule, nor shall any additional Person have
been authorized, from the date of this Agreement, to draw thereon or have access
thereto or to hold any such power of attorney, without the prior written consent
of the Purchaser. At the time of the Closing, all monies and accounts of the
Business shall be held by, and be accessible only to, the Business.
SECTION 3.29. Year 2000 Compliance. The Sellers have initiated
reviews and committed resources that, to the Sellers' knowledge, are sufficient
to ensure that on the Closing Date (a) all computer software necessary for the
conduct of the Business designed to be used prior to, during, and after December
31, 1999 will operate in all material respects during each such time period
without error relating to the year 2000, specifically including any error
relating to, or being the product of, date data which represents or references
different centuries or more than one century and (b) such computer software will
accept, calculate, sort, extract and otherwise process date inputs and date
values, and return and display date values, in a consistent manner regardless of
the dates used, whether before, on, or after January 1, 2000.
SECTION 3.30. Governmental Licenses and Permits. Section 3.30
of the Disclosure Schedule lists all material governmental qualifications,
registrations, filings, privileges, franchises, licenses, permits, approvals or
authorizations other than the Environmental Permits (collectively, the "MATERIAL
LICENSES") used or held in the conduct of the Business. All of such Material
Licenses are in full force and effect, and the Sellers and Century CP are in
material compliance with each such Material License.
SECTION 3.31. Disclosure Schedule Supplements. The facts,
events or circumstances referenced in the Disclosure Schedule Supplements, taken
as a whole, do not, and
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will not, individually or in the aggregate, result in Losses to the Business of
more than $1,000,000.
SECTION 3.32. Opinion of Financial Advisor. The Sellers have
received the opinion of Xxxxxx Xxxxxxx Xxxx Xxxxxx, dated a date prior to the
date hereof, to the effect that, as of such date, the Purchase Price is fair
from a financial point of view to the Sellers.
SECTION 3.33. Brokers. No broker, finder or investment banker
is entitled to any brokerage, finder's or other fee or commission from the
Business in connection with the transactions contemplated by this Agreement or
the Ancillary Agreements based upon arrangements made by or on behalf of the
Sellers.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
OF THE PURCHASER
As an inducement to the Sellers to enter into this Agreement,
the Purchaser hereby represents and warrants to the Sellers as follows:
SECTION 4.01. Organization and Authority of the Purchaser. The
Purchaser is duly organized, validly existing and in good standing under the
laws of its jurisdiction of organization and has all necessary corporate power
and authority to enter into this Agreement and the Ancillary Agreements to which
it is a party, to carry out its obligations hereunder and thereunder and to
consummate the transactions contemplated hereby and thereby. The execution and
delivery by the Purchaser of this Agreement and the Ancillary Agreements to
which it is a party, the performance by the Purchaser of its obligations
hereunder and thereunder and the consummation by the Purchaser of the
transactions contemplated hereby and thereby have been duly authorized by all
requisite action on the part of the Purchaser. This Agreement has been, and upon
their execution by the Purchaser the Ancillary Agreements will be, duly executed
and delivered by the Purchaser, and (assuming due authorization, execution and
delivery by the Sellers) this Agreement constitutes, and upon their execution
the Ancillary Agreements will constitute, legal, valid and binding obligations
of the Purchaser in accordance with their respective terms.
SECTION 4.02. No Conflict. Assuming compliance with the
notification requirements of the HSR Act and the making and obtaining of all
filings, notifications, consents, approvals, authorizations and other actions
referred to in Section 4.03, except as may result from any facts or
circumstances relating solely to the Sellers, the execution, delivery and
performance of this Agreement and the Ancillary Agreements by the Purchaser do
not and will not (a) violate, conflict with or result in the breach of any
provision of the Charter or by-laws (or other organizational documents) of the
Purchaser (b) materially conflict with or violate any Law or Governmental Order
applicable to the Purchaser or (c) conflict with, or result in any breach of,
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constitute a default (or event which with the giving of notice or lapse of time,
or both, would become a default) under, require any consent under, or give to
others any rights of termination, amendment, acceleration, suspension,
revocation or cancellation of, or result in the creation of any Encumbrance on
any of the assets or properties of the Purchaser pursuant to, any note, bond,
mortgage or indenture, contract, agreement, lease, sublease, license, permit,
franchise or other instrument or arrangement to which the Purchaser is a party
or by which any of such assets or properties is bound or affected, which would,
individually or in the aggregate, have a material adverse effect on the ability
of the Purchaser to consummate the transactions contemplated by this Agreement
or by the Ancillary Agreements.
SECTION 4.03. Governmental Consents and Approvals. The
execution, delivery and performance of this Agreement and each Ancillary
Agreement to which it is a party by the Purchaser do not and will not require
any consent, approval, authorization or other order of, action by, filing with,
or notification to, any Governmental Authority, except the notification
requirements of the HSR Act.
SECTION 4.04. Litigation. No claim, action, proceeding or
investigation is pending or, to the best knowledge of the Purchaser after due
inquiry, threatened, which seeks to materially delay or prevent the consummation
of, or which would be reasonably likely to materially adversely affect the
Purchaser's ability to consummate the transactions contemplated by this
Agreement and the Ancillary Agreements.
SECTION 4.05. Brokers. No Broker, finder or investment banker
is entitled to any brokerage, finder's or other fee or commission from the
Sellers in connection with the transactions contemplated by this Agreement or
the Ancillary Agreements based upon arrangements made by or on behalf of the
Purchaser.
ARTICLE V
ADDITIONAL AGREEMENTS
SECTION 5.01. Conduct of Business Prior to the Closing. (a)
The Sellers covenant and agree that, except with the prior written consent of
the Purchaser (which shall not be unreasonably withheld), between the date
hereof and the Closing, the Sellers shall, and shall cause Century CP to,
conduct the Business only in the ordinary course and consistent with the
Sellers' and Century CP's prior practice. Without limiting the generality of the
foregoing, except with the prior written consent of the Purchaser and except in
the ordinary course of business consistent with past practice to meet market
conditions, the Sellers shall, and shall cause Century CP to, (i) continue their
promotional activities, and pricing and purchasing policies, in accordance with
past practice; (ii) not shorten or lengthen the customary payment cycles, or
otherwise change the terms, for any payables or receivables; (iii) continue to
acquire, produce and maintain Inventory (including, without limitation, the mix
of Inventory) in accordance with past practice; (iv) use commercially reasonable
efforts to (A) preserve intact its business
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organization and the business organization of the Business, (B) keep available
to the Purchaser the services of the employees of the Business, (C) continue in
full force and effect without material modification all existing policies or
binders of insurance currently maintained in respect of the Business and (D)
preserve current relationships with customers, suppliers and other persons with
which the Business has significant business relationships; (v) exercise, but
only after notice to the Purchaser and receipt of the Purchaser's prior written
approval (which shall not be unreasonably withheld), any rights of renewal
pursuant to the terms of any of the leases or subleases set forth in Section
3.19(b) of the Disclosure Schedule which by their terms would otherwise expire;
(vi) renew or apply for renewal all Material Licenses and Environmental Permits;
(vii) not amend, modify or consent to the termination of any Material Contract
or the Business' rights thereunder; and (viii) not engage in any practice, take
any action, fail to take any action or enter into any transaction which could
cause any representation or warranty of the Sellers to be untrue in any material
respect or result in a material breach of any covenant made by the Sellers in
this Agreement.
(b) The Sellers covenant and agree, jointly and severally,
that, prior to the Closing, without the prior written consent of the Purchaser
(which shall not be unreasonably withheld), none of the Sellers or Century CP
will do any of the things enumerated in the second sentence of Section 3.13
(including, without limitation, clauses (a) through (bb) thereof).
(c) The Sellers covenant and agree that except with the prior
written consent of the Purchaser, between the date hereof and the Closing, the
Sellers shall not issue or sell any shares of capital stock or any option,
warrant or other right to acquire the same.
SECTION 5.02. Access to Information. (a) From the date hereof
until the Closing, upon reasonable notice to the Sellers' officers designated
below and for purposes of facilitating the transfer of the Business, the Sellers
shall, and shall cause Century CP and each of the Sellers' and Century CP's
officers, directors, managers, agents, accountants and counsel to (i) afford to
up to two officers, employees or authorized agents or representatives of the
Purchaser at any given facility at any given time for an aggregate of 12 days
(i.e., 24 man days) reasonable access during normal business hours to the
offices, properties, plant and other facilities of the Business (and to those
officers, directors, employees, agents, accountants and counsel of the Sellers
and Century CP who have knowledge relating to the Business) and (ii) furnish to
such representatives of the Purchaser such additional access, data and other
information regarding the Business and the Assets as the Purchaser may from time
to time reasonably request. The Purchaser acknowledges that nothing in this
Section 5.02 shall require the Sellers to grant access to officers, employees,
agents and representatives of the Purchaser in order to permit the Purchaser to
implement any expansion plans that it may contemplate in respect of the
Business. The parties hereto further agree that with respect to this Section
5.02 (i) all requests by the Purchaser for access or information will be
submitted or directed only to Century's President and Chief Operating Officer
(in respect of manufacturing and technical matters), Chief Financial Officer (in
respect of financial and accounting matters and management information and
control systems) and General Counsel and Chief Administrative Officer (in
respect of contractual, environmental, human resource and any other matters);
(ii) that the Purchaser shall not interfere
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with any of the businesses or operations of the Sellers or Century CP; and (iii)
that nothing in this Section 5.02 shall restrict the Purchaser's access to the
offices, properties, plant and other facilities of the Business (and to those
officers, directors, employees, agents, accountants and counsel of the Sellers
and Century CP who have knowledge relating to the Business) or financial,
operating, technical and environmental data and other information regarding the
Business and the Assets to the extent reasonably required or contemplated under
the Shared Services Agreement and the Molten Aluminum Purchase Agreement.
(b) In order to facilitate the resolution of any claims made
against or incurred by the Sellers prior to the Closing, for a period of seven
years after the Closing, the Purchaser shall (i) retain the books and records of
the Business which are transferred to the Purchaser pursuant to this Agreement
relating to periods prior to the Closing in a manner reasonably consistent with
the prior practices of the Sellers and (ii) upon reasonable notice, afford the
officers, employees and authorized agents and representatives of the Sellers
reasonable access (including the right to make, at the Sellers' expense,
photocopies), during normal business hours, to such books and records.
(c) In order to facilitate the resolution of any claims made
by or against or incurred by the Purchaser after the Closing, for a period of
seven years following the Closing, the Sellers shall (i) retain all books and
records of the Sellers which are not transferred to the Purchaser pursuant to
this Agreement and which relate to the Business for periods prior to the Closing
and which shall not otherwise have been delivered to the Purchaser and (ii) upon
reasonable notice, afford the officers, employees and authorized agents and
representatives of the Purchaser, reasonable access (including the right to make
photocopies at the expense of the Purchaser), during normal business hours, to
such books and records.
SECTION 5.03. Confidentiality. (a) For a period of two years
from the Closing Date, the Sellers agree to, and shall cause their agents,
representatives, Affiliates, Senior Managers, officers and directors to, and
shall use commercially reasonable efforts to cause their other employees to: (i)
treat and hold as confidential (and not disclose or provide access to any Person
to) all information relating to trade secrets, processes, patent or trademark
applications, product development, price, customer and supplier lists, pricing
and marketing plans, policies and strategies, operations methods, product
development techniques, business acquisition plans, new personnel acquisition
plans and any other confidential information with respect to the Business, (ii)
in the event that the Sellers or any such agent, representative, Affiliate,
Senior Manager or employee, officer or director becomes legally compelled to
disclose any such information, to the extent legally possible provide the
Purchaser with prompt written notice of such requirement so that the Purchaser
may seek a protective order or other remedy or waive compliance with this
Section 5.03(a), (iii) in the event that such protective order or other remedy
is not obtained, or the Purchaser waives compliance with this Section 5.03(a),
furnish only that portion of such confidential information which is legally
required to be provided and exercise commercially reasonable efforts to obtain
assurances that confidential treatment will be accorded such information, and
(iv) promptly furnish (prior to, at, or as soon as practicable following, the
Closing) to the Purchaser any and all copies (in whatever form or medium) of all
such
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confidential information then in the possession of the Sellers or any of their
agents, representatives, Affiliates, Senior Managers or employees, officers and
directors and destroy any and all additional copies then in the possession of
the Sellers or any of their agents, representatives, Affiliates, Senior Managers
or employees, officers and directors of such information and the portion of any
analyses, compilations, studies or other documents prepared on the basis
thereof; provided, however, that clauses (i), (ii) and (iii) of this sentence
shall not apply to any information that, at the time of disclosure, is available
publicly and was not disclosed in breach of this Agreement by the Sellers, their
agents, representatives, Affiliates, Senior Managers or employees, officers or
directors. The Sellers agree and acknowledge that remedies at Law for any breach
of their obligations under this Section 5.03(a) are inadequate and that in
addition thereto the Purchaser shall be entitled to seek equitable relief,
including injunction and specific performance, in the event of any such breach,
without the necessity of demonstrating the inadequacy of monetary damages.
(b) For a period of two years from the Closing Date, the
Purchaser agrees to, and shall cause its agents, representatives, Affiliates,
senior managers, officers and directors to, and shall use commercially
reasonable efforts to cause their other employees to: (i) treat and hold as
confidential (and not disclose or provide access to any Person to) all
information obtained in connection with transactions contemplated by this
Agreement and the Ancillary Agreements relating to trade secrets, processes,
patent or trademark applications, product development, price, customer and
supplier lists, pricing and marketing plans, policies and strategies, operations
methods, product development techniques, business acquisition plans, new
personnel acquisition plans and any other confidential information with respect
to the business of the Sellers (other than the Business), (ii) in the event that
the Purchaser or any such agent, representative, Affiliate, senior manager or
employee, officer or director becomes legally compelled to disclose any such
information, to the extent legally possible provide the Sellers with prompt
written notice of such requirement so that the Sellers may seek a protective
order or other remedy or waive compliance with this Section 5.03(b), (iii) in
the event that such protective order or other remedy is not obtained, or the
Sellers waive compliance with this Section 5.03(b), furnish only that portion of
such confidential information which is legally required to be provided and
exercise commercially reasonable efforts to obtain assurances that confidential
treatment will be accorded such information, and (iv) promptly furnish (prior
to, at, or as soon as practicable following, the Closing) to the Sellers any and
all copies (in whatever form or medium) of all such confidential information
then in the possession of the Purchaser or any of its agents, representatives,
Affiliates, senior managers or employees, officers and directors and destroy any
and all additional copies then in the possession of the Purchaser or any of its
agents, representatives, Affiliates, senior managers or employees, officers and
directors of such information and the portion of any analyses, compilations,
studies or other documents prepared on the basis thereof; provided, however,
that clauses (i), (ii) and (iii) of this sentence shall not apply to any
information that, at the time of disclosure, is available publicly and was not
disclosed in breach of this Agreement by the Purchaser, its agents,
representatives, Affiliates, senior managers or employees, officers or
directors. The Purchaser agrees and acknowledges that remedies at Law for any
breach of its obligations under this Section 5.03(b) are inadequate and that in
addition thereto the Sellers shall be entitled to seek equitable relief,
including injunction
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and specific performance, in the event of any such breach, without the necessity
of demonstrating the inadequacy of monetary damages.
SECTION 5.04. Regulatory and Other Authorizations; Notices and
Consents. (a) Each of the Sellers and the Purchaser will use commercially
reasonable efforts to obtain (or in the case of the Sellers cause Century CP to
obtain) all authorizations, consents, orders and approvals of all Governmental
Authorities and officials that may be or become necessary for their execution
and delivery of, and the performance of their obligations pursuant to, this
Agreement and the Ancillary Agreements and will cooperate fully with such other
parties in promptly seeking to obtain all such authorizations, consents, orders
and approvals, it being understood that (i) nothing in this Section 5.04(a) is
intended to be a covenant that the Sellers shall in fact obtain on the
Purchaser's behalf any such authorizations, consents, orders or approvals, or
(ii) except as provided in Section 8.02, obtaining any such authorizations,
consents, orders and approvals shall not be a condition to Closing. Each party
hereto agrees to make an appropriate filing, if necessary, pursuant to the HSR
Act with respect to the transactions contemplated by this Agreement within
fifteen Business Days of the date hereof and to supply as promptly as
practicable to the appropriate Governmental Authorities any additional
information and documentary material that may be requested pursuant to the HSR
Act. Each party to this Agreement shall promptly notify the other parties of any
communication it or any of its Affiliates receives from any Governmental
Authority relating to the matters that are the subject of this Agreement and
permit the other parties to review in advance any proposed communication by such
party to any Governmental Authority.
(b) The Sellers shall, or shall cause Century CP to, give
promptly such notices to third parties and use commercially reasonable efforts
to obtain such third party consents as the Purchaser may reasonably deem
necessary or desirable in connection with the transactions contemplated by this
Agreement, including, without limitation, all third party consents that are
necessary or desirable in connection with the transfer of the Material
Contracts, it being understood that (i) nothing in this Section 5.04(b) is
intended to be a covenant that the Sellers shall in fact obtain on the
Purchaser's behalf any such consents or (ii), except as provided in Section
8.02(l), obtaining any such consents shall not be a condition to Closing.
(c) The Purchaser shall cooperate and use commercially
reasonable efforts to assist the Sellers in giving such notices and obtaining
such consents; provided, however, that the Purchaser shall have no obligation to
give any guarantee or other consideration of any nature in connection with any
such notice or consent or to consent to any change in the terms of any Material
Contract which the Purchaser may deem adverse to the interests of the Purchaser
or the Business.
(d) The Sellers and the Purchaser agree that, in the event any
consent, approval or authorization necessary or desirable to preserve for the
Business or the Purchaser any right or benefit under any lease, license,
contract, commitment or other agreement or arrangement to which the Sellers or
Century CP is a party and which is to be transferred to the Purchaser pursuant
to Section 2.01(a) is not obtained prior to the Closing, the Sellers will,
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subsequent to the Closing, cooperate with the Purchaser in attempting to obtain
such consent, approval or authorization as promptly thereafter as practicable.
If such consent, approval or authorization cannot be obtained, the Sellers will
use commercially reasonable efforts to provide the Purchaser on a back-to-back
or similar basis with the rights and benefits of the affected lease, license,
contract, commitment or other agreement or arrangement for the term of such
lease, license, contract or other agreement or arrangement, and, if the Sellers
provide such rights and benefits, the Purchaser shall assume the obligations and
burdens thereunder.
SECTION 5.05. Disclosure Schedule Supplements; Notice of
Developments. (a) The Purchaser and the Sellers agree that the Sections of the
Disclosure Schedule qualifying Article III are not final and are subject to
further review and revision. The Sellers may supplement such Sections of the
Disclosure Schedule qualifying Article III by including, to the extent
appropriate, a description (in reasonable detail) of facts, events or
circumstances affecting the Business and existing prior to the date hereof and
delivering to the Purchaser within 20 days of the date hereof supplemental
sections of the Disclosure Schedule qualifying Article III (each, "DISCLOSURE
SCHEDULE SUPPLEMENT"); provided that nothing in this Section 5.05(a) will permit
the Sellers to include in the Disclosure Schedule Supplements any references to
any facts, events or circumstances which, taken as a whole, individually or in
the aggregate, (i) reflect Liabilities of the Business greater than $1,000,000,
(ii) result in, or may be reasonably likely to result in, Losses to the Business
of more than $1,000,000 or (iii) would materially and adversely affect the
Purchaser's ability to conduct the Business on the Closing Date.
(b) Prior to the Closing, the Sellers shall promptly notify
the Purchaser in writing of (i) all events, circumstances, facts and occurrences
arising subsequent to the date of this Agreement which result in any material
breach of a representation or warranty or covenant of the Sellers in this
Agreement or which have the effect of making any representation or warranty of
the Sellers in this Agreement untrue or incorrect in any material respect and
(ii) all other developments materially affecting the Business or the Business
Assets.
SECTION 5.06. Use of Intellectual Property. (a) Except as
determined by the committee to be established pursuant to the Shared Services
Agreement in respect of the Shared Intellectual Property or as set forth in
Section 5.06 of the Disclosure Schedule, from and after the Closing, none of the
Sellers or the Subsidiaries (other than Century CP) shall use any of the Owned
Intellectual Property or the Licensed Intellectual Property.
SECTION 5.07. Non-Competition. (a) In partial consideration of
the payment of the Purchase Price, as set forth in Section 2.04, the Sellers and
the Purchaser agree that, for a period of five (5) years after the Closing (the
"RESTRICTED PERIOD"), none of the Sellers or the Subsidiaries (other than
Century CP) shall acquire, directly or indirectly, any ownership, equity, or
similar interest (whether through a stock, asset or other type of transaction)
in any multipurpose aluminum rolling mill in North America having a production
capacity of at least 500,000,000 pounds per year that manufactures, produces or
supplies heat-treated aluminum products or brazing products ("COVERED
PRODUCTS"), provided that nothing herein shall restrict the Sellers from
acquiring an interest in a Person that manufactures, produces or supplies
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Covered Products if such activities did not represent or account for more than
20% of such Person's revenues, assets or income during, or as of the end of, any
of the three fiscal years preceding the proposed date of acquisition.
(b) As a separate and independent covenant, the Sellers agree
with the Purchaser that, for a period of five (5) years following the Closing,
none of the Sellers or the Subsidiaries (other than Century CP) will in any way,
directly or indirectly, interfere or attempt to interfere with any contractual
relationship in North America of the Business with any customer or supplier
relationship in existence on the date hereof.
(c) The Restricted Period shall be extended by the length of
any period during which the Sellers are in breach of the terms of this Section
5.07.
(d) The Sellers acknowledge that the covenants of the Sellers
set forth in this Section 5.07 are an essential element of this Agreement and
that, but for the agreement of the Sellers to comply with these covenants, the
Purchaser would not have entered into this Agreement. The Sellers acknowledge
that this Section 5.07 constitutes an independent covenant and shall not be
affected by performance or nonperformance of any other provision of this
Agreement by the Purchaser. The Sellers has independently consulted with its
counsel and after such consultation agrees that the covenants set forth in this
Section 5.07 are reasonable and proper.
SECTION 5.08. Bulk Transfer Laws. Without prejudice to Section
9.02(a)(vi), the Purchaser hereby waives compliance by the Sellers with any
applicable bulk sale or bulk transfer laws of any jurisdiction in connection
with the sale of the Assets to the Purchaser.
SECTION 5.09. Cash; Other Communications. From and after the
Closing, (a) the Sellers shall use commercially reasonable efforts to take, or
cause to be taken, all appropriate action, and do or cause to be done all things
necessary, proper or advisable under the applicable Laws to put the Purchaser in
effective possession, ownership and control of the Business Assets and the
Purchaser shall cooperate with the Sellers for that purpose and (b) the
Purchaser shall use commercially reasonable efforts to take, or cause to be
taken, all appropriate action, and do or cause to be done all things necessary,
proper or advisable under applicable Laws to put the Sellers in effective
possession, ownership and control of assets not included within the Business
Assets and the Sellers shall cooperate with the Purchaser for that purpose.
Subject to the terms of the Shared Services Agreement, all cash and other
remittances, mail and other communications relating to the Business Assets or
the Business received by the Sellers or their Affiliates shall be promptly
turned over to the Purchaser by the Sellers and, until sent to the Purchaser,
shall be deemed held in trust by the Sellers for the benefit of the Purchaser.
Subject to the terms of the Shared Services Agreement, all cash and other
remittances, mail and other communications relating to any business of the
Sellers not included within the Business being purchased by the Purchaser
hereunder that are received by the Purchaser shall be promptly turned over to
the Sellers by the Purchaser and, until sent to the Sellers, shall be deemed
held in trust by the Purchaser for the benefit of the Sellers.
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SECTION 5.10. Further Action. (a) Each of the parties hereto
shall use commercially reasonable efforts to take, or cause to be taken, all
appropriate action, do or cause to be done all things necessary, proper or
advisable under applicable Laws, and execute and deliver such documents and
other papers, as may be required to carry out the provisions of this Agreement
and the Ancillary Agreements and consummate and make effective the transactions
contemplated by this Agreement and the Ancillary Agreements, including, without
limitation, fulfill, or cause to be fulfilled, the conditions set forth in
Article VIII.
(b) The Purchaser agrees with the Sellers that, for a period
of two (2) years following the Closing Date, none of the Purchaser or its
Affiliates on the one hand, or the Sellers or their respective Affiliates on the
other hand, will, in any way, directly or indirectly, solicit, offer to hire or
induce (except through advertisements to the general public for positions) any
person who is an employee of the other, to accept employment by it or enter into
a business relationship with it.
SECTION 5.11. Environmental Permits. The Sellers will assist
the Purchaser in the transfer or the reissue of such Environmental Permits or in
any arrangement for their continued use by the Purchaser, including assisting in
filing applications for any new Environmental Permits, it being understood that
(a) nothing in this Section 5.11 is intended to be a covenant that the Sellers
shall in fact obtain on the Purchaser's behalf any such Environmental Permits,
or (b) except as provided in Section 8.02, obtaining any such Environmental
Permits shall not be a condition to Closing
SECTION 5.12. Intellectual Property. The Sellers agree to
provide to the Purchaser within 15 Business Days of the date hereof a list of
all Owned Intellectual Property and all Licensed Intellectual Property that is
currently used by Century WV in its operations other than the Business
(collectively, the "SHARED INTELLECTUAL PROPERTY"), provided that the parties
agree that the Shared Intellectual Property shall not include any Owned
Intellectual Property or Licensed Intellectual Property that is material to the
Business or used in the manufacturing activities of the Business. The parties
agree to refer to the committee to be established pursuant to the Shared
Services Agreement matters relating to the Shared Intellectual Property and that
the Shared Intellectual Property shall thereafter be deemed a "Shared Service"
under such agreement.
ARTICLE VI
EMPLOYEE MATTERS
SECTION 6.01. Offer of Employment. No later than 10 days prior
to the Closing Date, the Purchaser shall offer employment to each of the hourly
and salaried employees listed on a schedule previously provided to the Purchaser
who remains actively employed by the Sellers as of the Closing Date in the
Rolling Business (excluding individuals on short or long
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term disability or leave of absence or layoff). Each such employee who accepts
such offer of employment by the Purchaser, and each employee hired after the
date hereof by the Sellers to work in the Rolling Business and who accepts an
offer of employment by the Purchaser on or prior to the Closing Date shall
hereinafter be referred to as a "TRANSFERRED EMPLOYEE".
SECTION 6.02. Collective Bargaining Agreements. As of the
Closing Date, the Purchaser agrees to assume any existing collective bargaining
agreements sponsored by the Sellers and listed on Section 3.23 of the Disclosure
Schedule.
SECTION 6.03. Defined Benefit Pension Plans. (a) Effective as
of the Closing Date, the Transferred Employees shall no longer participate in
the Sellers' defined benefit pension plans. Effective as of such date, the
Purchaser shall establish replacement defined benefit pension plans (the "NEW
DEFINED BENEFIT PLANS") that are intended to be qualified under Section 401(a)
of the Code, and a related trust or trusts that are intended to be exempt from
taxation under Section 501(a) of the Code for the benefit of the Transferred
Employees, the terms of which plans and trust(s) shall be substantially
comparable to the terms of the Sellers' defined benefit pension plans (and in
compliance with any applicable collective bargaining agreement). The Purchaser
agrees that the new Defined Benefit Plans and their related trusts and funding
arrangements shall be operative in all respects on the Closing Date and the
Purchaser agrees to deliver to the Seller the certificate of an officer or an
opinion of counsel representing that the New Defined Benefit Plans meet the
requirements for qualification under Section 401(a) of the Code. The Purchaser
agrees as soon as practicable after the Closing Date to apply for, and take all
actions necessary to secure, a determination letter from the Internal Revenue
Service to the effect that the New Defined Benefit Plans are qualified under the
applicable provisions of the Code. The Purchaser further agrees that if such a
determination letter is not obtained, any liability resulting from the failure
to obtain such letter shall be the responsibility of the Purchaser. The
Purchaser shall recognize the Transferred Employees' service prior to the
Closing Date with the Sellers for all purposes under the New Defined Benefit
Plans.
(b) As soon as practicable after the Closing Date, the Sellers
shall cause to be transferred from the Sellers' defined benefit pension plans
(the "SELLERS' PENSION PLANS") to the New Defined Benefit Plans all accrued
benefits and other liabilities of the Sellers' Pension Plans relating to the
Transferred Employees and to the employees of the Rolling Business whose
employment terminated prior to the Closing Date ("FORMER EMPLOYEES") in the
manner described below (the "TRANSFERRED BENEFITS"). Following completion of the
transfer of assets and liabilities from the Sellers' Pension Plans to the New
Defined Benefit Plans, the Sellers shall have no further liability whatsoever
with respect to the Former Employees and the Transferred Employees for benefits
under the Sellers' Pension Plans, other than liability for any breach of
fiduciary duties or any nonexempt prohibited transaction occurring prior to such
transfer. As of the Closing Date, the Sellers shall cause the Sellers' Pension
Plans to be amended so as to cease further accrual of benefits with respect to
the Former Employees and Transferred Employees. Section 6.03(b) of the
Disclosure Schedule lists all Former Employees together with relevant data
concerning their age, date of hire, date of termination and accrued pension
benefits.
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(c) As a condition of making the transfer of assets and
liabilities described below in this section, the Sellers and the Purchaser shall
be entitled to receive the following: (i) in the case of the Sellers, a
certificate from an officer or an opinion of counsel of the Purchaser
representing that the New Defined Benefit Plans meet the requirements for
qualification under Section 401(a) of the Code and that the Purchaser has timely
requested a determination letter from the Internal Revenue Service confirming
such qualification; (ii) in the case of the Purchaser, a certificate from an
officer or an opinion of counsel of the Sellers representing that the Sellers'
Plans have received a recent favorable determination from the Internal Revenue
Service to the effect that the Sellers' Plans meet such requirements for
qualification; and (iii) to Sellers' knowledge, there have been no amendments or
actions since the issuance of such favorable determination letter which
adversely affect such plans' qualifications.
(d) The Sellers shall cause Deloitte & Touche (the "SELLERS'
ACTUARY") to determine the amount of assets required by Section 414(l) of the
Code for the Transferred Benefits obligation based on allocating assets by
priority categories described in Section 4044(a) of ERISA (the "414(l) AMOUNT"),
to be transferred from the Sellers' Plans to the New Defined Benefit Plans. The
414(l) Amount shall be determined as of the Closing Date by the Sellers' Actuary
on the basis of the Pension Benefit Guaranty Corporation's safe harbor plan
termination assumptions set forth in Section 4044 of ERISA and the remaining
assumptions used in the most recent ERISA actuarial valuation of the Sellers'
Plans (the "SAFE HARBOR ASSUMPTIONS"). In connection therewith, the Sellers
shall cause the Sellers' Actuary to determine the amounts of charges and credits
to the funding standard account under Section 412 of the Code, the funding
standard account credit balance and the annual amortization charges and credits
(such amounts determined under the provisions of Internal Revenue Service
Revenue Ruling 81-212 and other applicable guidance) to be allocated between the
Sellers' Plans and the New Defined Benefit Plans as a result of the transfer of
assets and liabilities anticipated under this section. Such amounts shall be
determined without regard to use of the de minimis option contained in such
revenue ruling and the regulations promulgated under Section 414(l) of the Code.
The actuarial calculation of the liabilities by Pension Benefit Guaranty
Corporation priority categories underlying the 414(l) Amount determined by the
Sellers' Actuary shall be reviewed and verified by an actuarial firm designated
by the Purchaser (the "PURCHASER'S ACTUARY").
(e) As soon as practicable after the Closing Date, but in no
event later than 30 days from the Closing Date, the Sellers shall prepare and
file Form 5310A with respect to the transfer required by this section, and
within 60 days of the Closing Date, the Sellers shall cause to be transferred
from the trusts for the Sellers' Plans to the trusts established for the New
Pension Plans an amount in cash and marketable securities acceptable to the
parties equal to 80% of the amount reasonably estimated by the Sellers' Actuary
in good faith, after verification and approval by the Purchaser's Actuary, to be
equal to the 414(l) Amount; provided, however, that such estimated amount shall
be calculated prior to the last day of the month subsequent to the execution of
this Agreement (the "INITIAL TRANSFER AMOUNT"). As soon as practicable after the
final determination of the 414(l) Amount, calculated as of the Closing Date (the
"TRUE-UP DATE"), but in no event later than 6 months from the Closing Date, the
Sellers shall cause a second transfer to be made to the New Pension Plans in
cash and marketable securities acceptable to the parties, of the "TRUE-UP
AMOUNT". The True-Up Amount shall be equal to the
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414(l) Amount (A) minus the sum of (i) the Initial Transfer Amount and (ii)
distributions, if any, made with respect to Transferred Employees and Former
Employees from the Closing Date through the True-Up Date, and (B) plus earnings
in the Money Market Vehicle described in (g) below. Such True-Up Amount shall be
determined by the Sellers' Actuary, after verification and approval by the
Purchaser's Actuary. Once the Sellers' Actuary and the Purchaser's Actuary shall
reach agreement, the Sellers' Actuary shall verify that the completed transfers
comply with the requirements of Section 414(l). Nothing in this Section 6.03(e)
shall prevent the Sellers from filing the Form 5310A in their discretion prior
to the Closing Date.
(f) The Sellers' Actuary shall provide the Purchaser's Actuary
with the results of the calculations made under paragraphs (d) and (e) above and
with records and other information in support of such calculations as required
by the Purchaser's Actuary to verify and approve such calculations. The Sellers
and the Purchaser will cause their respective actuaries to work together in good
faith to promptly resolve any differences between them with respect to such
calculations. The expenses of the Sellers' Actuary shall be borne by the
Sellers, and the expenses of the Purchaser's Actuary shall be borne by the
Purchaser. In the event such differences cannot be resolved, the two actuaries
shall appoint a third actuary to resolve such differences, and the cost of such
third actuary shall be equally borne by the Sellers and the Purchaser. The
decision of such third actuary shall be final and binding on the Sellers and the
Purchaser.
(g) Notwithstanding any provisions to the contrary in this
Section 6.03, it is the intention of the parties that the Sellers shall attempt
to minimize the market risk from the Closing Date to the date the True Up Amount
is transferred (the "MARKET RISK PERIOD") by placing 125% of the Initial
Transfer Amount into a money market account or other fixed income investment
vehicle offered by the Sellers' Trustee on the Closing Date (the "MONEY MARKET
VEHICLE"), and it is agreed that the return on such investment during the Market
Risk Period shall be paid to the Purchaser's New Defined Benefit Plans at the
time of transfer of the True Up Amount. The Initial Transfer Amount and any
distributions made with respect to Transferred Employees and Former Employees
during the Market Risk Period shall be paid from the Money Market Vehicle.
Promptly after the date hereof the Sellers and the Purchaser shall contact the
PBGC and seek to have the PBGC terminate the PBGC Agreement and release the PBGC
lien on the Ravenswood Owned Real Property. If the PBGC does not terminate the
PBGC Agreement prior to the Closing or does not agree to postpone until after
the Closing the quarterly installment contributions to the Sellers' Pension
Plans described in Section 2(c)(ii) of the PBGC Agreement, and the Sellers are
required to make any such quarterly installment contribution before the Closing,
the Purchase Price shall be increased by the after-tax effective cost to the
Sellers of such contribution, multiplied by 78%, representing the agreed upon
share of such contribution attributable to the Transferred Benefits, plus
interest at 6% from the date of such contribution to the Closing Date.
SECTION 6.04. Welfare Benefit Plans. The Sellers shall be
responsible for providing COBRA benefits to all employees of the Rolling
Business whose employment terminated on or before the Closing Date, and for
providing COBRA notices to all Transferred
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Employees, as required by applicable law. Effective as of the Closing Date, the
Purchaser shall be responsible for all employee welfare plan benefits or
payments for Transferred Employees whether accruing before or after the Closing
Date. Except as provided in Section 6.05 on and after the Closing Date, the
Purchaser shall provide to the Transferred Employees such welfare benefit plans,
which are substantially comparable to those enjoyed by such Transferred
Employees immediately prior to the Closing Date which comply with applicable
collective bargaining agreements; provided, however, that nothing contained in
this Section 6.04 shall obligate or commit the Purchaser to continue any welfare
benefit plan, program or arrangement after the Closing Date for any particular
length of time, or to limit the right of the Purchaser to amend, modify,
suspend, revoke or terminate any such plan, subject, however, to the provisions
of any applicable collective bargaining agreement.
SECTION 6.05. Retiree Medical and Life Insurance Plans. On and
after the Closing Date, the Purchaser shall assume all retiree medical and life
insurance obligations of the Sellers for Transferred Employees and former
employees of the Rolling Business who are identified in Section 6.05 of the
Disclosure Schedule but only to the extent that such obligations relate to
claims that are accrued on the Closing Balance Sheet, and the Purchaser shall
provide to the Transferred Employees retiree medical and life insurance benefits
substantially comparable to those enjoyed by such employees immediately prior to
the Closing Date and in accordance with any applicable collective bargaining
agreement; provided, however, that nothing contained in this Section 6.05 shall
limit the right of the Purchaser to amend, modify, suspend, revoke or terminate
any such obligations or benefits, it being understood that the Sellers shall not
be liable to such former employees or Transferred Employees solely by reason of
the Purchaser's amendment, modification, suspension, revocation or termination
of obligations or benefits.
SECTION 6.06. Workers' Compensation Claims. Effective as of
the Closing Date, the Sellers agree to assign all workers' compensation
insurance policies relating to employees of the Business to the Purchaser. The
Purchaser agrees to assume all workers' compensation claims brought by employees
or former employees of the Rolling Business, including by Transferred Employees,
whether such claims accrue or are brought before or after the Closing Date, and
the Sellers shall have no further liability therefor on or after the Closing
Date.
SECTION 6.07. PBGC Agreement. (a) The Sellers and the
Purchaser agree that each Party will be entitled to participate in discussions
with the PBGC and will use commercially reasonable efforts to obtain, on or
prior to the Closing Date, the release of the Collateral described in the
Agreement made as of January 23, 1996, between Century, the PBGC and certain
other parties (the "PBGC AGREEMENT") which is related to the Rolling Business,
such that the PBGC no longer has a security interest in any Assets purchased
hereunder, provided, however, that the Sellers do not guaranty the release of
such security interest nor shall a release of such security interest be a
condition to Closing.
(b) Each of the Sellers and the Purchaser, respectively,
agrees to comply with any requirements set forth by the PBGC, including without
limitation payments, guarantees or
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the provision of other security to the extent, in the case of the Sellers, such
requirements apply to the Reduction Facility and in the case of the Purchaser to
the Rolling Business.
(c) The Purchaser and the Sellers agree to cooperate with each
other in attempting to effect the release of the Collateral described in (a)
above, including the disclosure of information relating to the Purchaser and the
Sellers and their Affiliates that may be requested by the PBGC in connection
with the PBGC's review of the transaction contemplated thereby.
SECTION 6.08. Management Services Agreement. The Sellers agree
that prior to the Closing Date, Century shall have entered into the Management
Services Agreement, under which Century agrees to provide the services of
certain key executives of Century on a limited basis to the Purchaser for a fee
after the Closing Date. Such services and the times the services shall be
provided are specified in such agreement.
SECTION 6.09. Incentive Plans. The Sellers shall be
responsible for all payments to any Transferred Employees under any incentive,
bonus, stock option, stock purchase or similar plans of the Sellers, and for the
payment of any benefits under such plans, which are accelerated, or become
payable, as a result of the Closing, and the Purchaser shall have no
responsibility for any such payments. The Purchaser shall have no responsibility
to continue any such plans after the Closing or to make any payments under such
plans.
SECTION 6.10. Employment Agreements. The Purchaser agrees to
assume the Employment Agreements disclosed in Section 3.22(a) of the Disclosure
Schedule, to the extent the same are in effect on the Closing Date with respect
to the Transferred Employees.
SECTION 6.11. 401(k) Plan. Effective as of the Closing Date,
Transferred Employees shall no longer actively participate in the Ravenswood
Aluminum Corp. United Steelworkers of America Savings Plan or the Ravenswood
Aluminum Corp. Salaried Employees Defined Contribution Plan (together, the
"SELLERS' DEFINED CONTRIBUTION PLANS"). Effective as of the Closing Date, the
Purchaser shall establish or make available one or more defined contribution
plans for Transferred Employees containing terms substantially identical (other
than employer stock terms) to those of the Sellers' Defined Contribution Plans
(the "PURCHASER'S DEFINED CONTRIBUTION PLANS") and in compliance with applicable
collective bargaining agreements and shall credit Transferred Employees for
their service with the Sellers for participation and vesting purposes under the
Purchaser's Defined Contribution Plans. As soon as practicable following the
Closing Date, and upon receipt by the Sellers and by the Purchaser of the
officer's certificates or opinions of counsel referred to below, the Sellers
shall cause to be transferred from the Sellers' Defined Contribution Plans to
the Purchaser's Defined Contribution Plans, and the Purchaser shall cause to be
received, assets equal to the finalized account balances of such Transferred
Employees who participated in the Sellers' Defined Contribution Plans. Effective
as of the Closing Date, the Sellers shall cause each Transferred Employee to be
fully vested in his or her account balance. The Sellers shall insure that such
Transferred Employees do not receive in service distributions from the Sellers'
Defined Contribution Plans in advance of such transfer. As a condition to such
transfer, the Sellers and the Purchaser shall each be entitled
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to receive from the other an officer's certificate or an opinion of counsel to
the effect that the Sellers' Defined Contribution Plans, and the Purchaser's
Defined Contribution Plans, as the case may be, either (a) have received a
recent favorable determination letter as to their qualification under the Code,
and nothing has occurred since the date of such letter which would cause the
loss of such qualification or (b) substantially complies by its terms with the
relevant qualification provisions of the Internal Revenue Code, and the plan
sponsor has timely applied for a favorable determination letter with respect to
the plans, and will make whatever changes to the plans as are requested by the
Internal Revenue Service as a condition of qualification.
SECTION 6.12. Century CP Plans. The Purchaser shall assume all
the rights and obligations of Century under the Acquisition Agreement made as of
December 22, 1998 between Alcoa and Century (the "ALCOA AGREEMENT") with respect
to Employee Matters described in Section 9.09 of the Alcoa Agreement.
SECTION 6.13. Century CP Pension Plan. (a) Effective as of the
Closing Date, the employees employed by Century CP (the "XXXXXX EMPLOYEES")
shall no longer participate in the relevant Alcoa defined benefit pension plans
(the "ALCOA PLANS"). Effective as of such date, the Purchaser shall establish
replacement defined benefit pension plans (the "NEW XXXXXX PLANS") in compliance
with applicable collective bargaining agreements that are intended to be
qualified under Section 401(a) of the Code, and related trusts that are intended
to be exempt from taxation under Section 501(a) of the Code for the benefit of
the Xxxxxx Employees, the terms of which plans and trusts shall be substantially
comparable to the terms of the Alcoa Plans. The Purchaser agrees as soon as
practicable after the Closing Date to apply for, and take all actions necessary
to secure, determination letters from the Internal Revenue Service to the effect
that the New Xxxxxx Plans are qualified under applicable provisions of the Code.
Assuming assets are transferred as provided in (b) below, the Purchaser shall
recognize the Xxxxxx Employees' service prior to the Closing Date with Alcoa and
with the Sellers for all purposes under the New Xxxxxx Plans.
(b) The Sellers agree, to the extent provided by the terms of
the Alcoa Agreement, to cause Alcoa to transfer assets on a timely basis from
the Alcoa Plans to the New Xxxxxx Plans in accordance with the provisions of
Section 9.09(c)(3) of the Alcoa Agreement.
SECTION 6.14. Century CP Annual Performance Pay Plan. The
Sellers agree that the Closing Balance Sheet will show, as a liability of the
Business, amounts earned on a pro rata basis by the Xxxxxx Employees who
participate in the Performance Pay Plan pursuant to the collective bargaining
agreement dated May 16, 1997 between UAW Local No. 808 and Century CP and the
Purchaser shall pay such amounts to such employees in accordance with the
collective bargaining agreements of Century CP following the delivery of the
Closing Balance Sheet.
ARTICLE VII
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TAX MATTERS
SECTION 7.01. Indemnity. (a) Each of Century and Century WV
agree, on a joint and several basis, to indemnify and hold the Purchaser,
Century CP and their Affiliates harmless from and against any and all of the
following Taxes (other than payroll and other employment taxes to the extent
accrued on the Closing Balance Sheet), including reasonable attorneys' and
accountants' fees and other reasonable out-of-pocket expenses incurred in
connection therewith: (i) Taxes imposed on or payable by Century CP or in
respect of the Rolling Assets with respect to taxable periods ending on or
before the Closing Date; (ii) with respect to taxable periods beginning before
the Closing Date and ending after the Closing Date, Taxes imposed on Century CP
or in respect of the Rolling Assets which are allocable, pursuant to Section
7.01(b) hereof, to the portion of such period ending on the Closing Date; (iii)
Taxes imposed on any member of an affiliated, consolidated, unitary or other
combined group with which Century CP files or has filed a Tax return in a period
ending on or prior to the Closing Date on a consolidated, unitary or other
combined basis or with which one or more of the Sellers file a Tax return on
such basis after the Closing Date; (iv) Taxes imposed on or payable by Century
CP as a result of (A) the Code section 338(h)(10) Election with respect to
Century CP referred to in Section 7.07 and (B) an actual or deemed election
under a state or local provision which is analogous or comparable to Code
Section 338(h)(10); (v) Taxes relating to any payments required to be made after
the Closing Date under any Tax indemnity, Tax sharing, or Tax allocation
agreement between the Sellers and Century CP under which Century CP was
obligated, or was a party, on or prior to the Closing Date; and (vi) Taxes
arising from the breach of any representation, warranty or covenant of the
Sellers with respect to Taxes under this Agreement. For purposes of this Section
7.01(a), the Sellers agree, on a joint and several basis, to indemnify the
Purchaser for any and all out-of-pocket costs and expenses (including reasonable
fees for attorneys and other outside consultants) incurred in connection with
any contest of any Tax liability for which the Sellers are liable under this
Article VII.
(b) In the case of Taxes that are payable with respect to a
taxable period that begins before the Closing Date and ends after the Closing
Date, the portion of any such Tax that is allocable to the portion of the period
ending on the Closing Date shall be:
(i) in the case of Taxes that are either (x) based upon or
related to income or receipts, or (y) imposed in connection with any
sale or other transfer or assignment of property (real or personal,
tangible or intangible) (other than conveyances pursuant to this
Agreement, as provided under Section 7.06), deemed equal to the amount
which would be payable if the taxable year ended with the Closing Date;
and
(ii) in the case of Taxes imposed on a periodic basis with
respect to the assets of the Sellers or any Subsidiary, or otherwise
measured by the level of any item, 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
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the period ending on the Closing Date and the denominator of which is
the number of calendar days in the entire period.
SECTION 7.02. Returns and Payments. From the date of this
Agreement through and after the Closing Date, the Sellers shall prepare and file
or otherwise furnish in proper form to the appropriate Governmental Authority
(or cause to be prepared and filed or so furnished) in a timely manner all Tax
returns, reports and forms ("RETURNS") relating to the Sellers, Century CP and
the Business that is due on or before or relates to any taxable period ending on
or before the Closing Date (and the Purchaser shall do the same for Returns
relating to Century CP and the Business with respect to any taxable period
ending after the Closing Date). Returns of Century CP and the Business not yet
filed for any taxable period that begins before the Closing Date shall be
prepared in a manner consistent with past practices employed with respect to
Century CP, but only if the preparation of such Returns in a manner inconsistent
with past practices would have a Material Adverse Effect on the non-preparing
party (except (i) to the extent counsel for the Sellers renders a legal opinion
stating that there is no reasonable basis in law therefor or that a Return
cannot be so prepared and filed without being subject to penalties or (ii) with
the consent of the Purchaser, which shall not be unreasonably withheld). With
respect to any Return required to be filed by the Purchaser or the Sellers with
respect to Century CP and the Business and as to which an amount of Tax is
allocable to the other party under Section 7.01(b), the filing party shall
provide the other party and its authorized representatives with a copy of such
completed Return and a statement certifying the amount of Tax shown on such
Return that is allocable to such other party pursuant to Section 7.01(b),
together with appropriate supporting information and schedules at least 20
Business Days prior to the due date (including any extension thereof) for the
filing of such Return, and such other party and its authorized representatives
shall have the right to review and comment on such Return and statement prior
the filing of such Return. The Sellers and the Purchaser agree to consult and
resolve in good faith any issue arising out of the review of any such Tax
Return. In the event the parties are unable to resolve any dispute within thirty
(30) days following the delivery of such Tax Return by the filing party to the
non-filing party, the parties shall resolve their dispute by jointly requesting
that a mutually acceptable accounting firm which is not the past or then current
principal auditors of the Purchaser or the Sellers resolve any issue before the
due date of such Tax Return, in order that such Tax Return may be timely filed.
The scope of the accounting firm's review shall be limited to the disputed
items. The Sellers and the Purchaser shall each pay one-half of the accounting
firm's fees and expenses.
SECTION 7.03. Tax Refunds and Credits. The Purchaser shall,
within forty-five (45) days following receipt of any tax refund, credit or
offset, pay to the Sellers the amount of any Tax refund or credit or offset
(including any interest paid or credited or any offset allowed with respect
thereto), but reduced by any Taxes that the Purchaser or Century CP shall be
required to pay with respect thereto, received or used, in the case of a credit
or offset, by the Purchaser or Century CP of Taxes (i) relating to taxable
periods or portions thereof ending on or before the Closing Date (including any
taxes allocated to such period under Section 7.01(b) hereof), or (ii)
attributable to an amount paid by the Sellers under Section 7.01(a) hereof. The
amount of any refunds or credits or offsets (including any interest paid or
credited with respect
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thereto) received by the Purchaser or Century CP shall be for the account of the
Purchaser if the refund, credit or offset is of Taxes relating to taxable
periods that begin after the Closing Date (including any taxes allocated to such
period under Section 7.01(b) hereof). The Purchaser may, for its own account,
claim a refund, credit or offset that relates to an adjustment to a taxable
period that begins before the Closing Date that arises from an adjustment to a
taxable period beginning on or after the Closing Date, provided, however, that
the Sellers must consent to any such refund claim, which consent may not be
unreasonably withheld (for this purpose, withholding of consent shall be
reasonable if such refund claim could reasonably be expected to have a material
tax cost or otherwise materially adversely affect the Sellers. The Purchaser
shall, if the Sellers so request and at the Sellers' expense, cause the relevant
entity to file for and use commercially reasonable efforts to obtain and
expedite the receipt of any refund to which the Sellers are entitled under this
Section 7.03, provided, however, that the Purchaser must consent to any such
refund claim, which consent may not be unreasonably withheld (for this purpose,
withholding of consent shall be reasonable if such refund claim could reasonably
be expected to have a material tax cost or otherwise materially adversely affect
the Purchaser, Century CP or any of their Affiliates).
SECTION 7.04. Time of Payment. Payment by the Sellers of any
amount due under this Article VII shall be made within thirty (30) days
following written notice by the Purchaser that payment of such amounts to the
appropriate Tax authority or other appropriate party is due; provided that in
the case of any payment due to a Tax authority or other appropriate party the
Sellers shall not be required to make any payment earlier than two days before
it is due to the appropriate Tax authority. In the case of a Tax that is
contested in accordance with the provisions of Section 7.08 (other than a Tax
contested in any administrative or judicial proceeding in which the Tax
contested must be paid prior to or upon commencement of such proceeding),
payment of the Tax to the appropriate Tax authority will not be considered to be
due earlier than the date a final determination has been made as defined in
Section 1313(a) of the Code or as finally determined pursuant to any similar
rule or provision of any relevant applicable Tax laws of any state, local,
foreign or other Tax jurisdiction (a "FINAL DETERMINATION").
SECTION 7.05. Cooperation and Exchange of Information. Upon
the terms set forth in Section 5.02, the Sellers and the Purchaser will provide
each other with such cooperation and information as either of them reasonably
may request of the other in facilitating an appraisal of the assets of the
Business, preparing and filing any Return, amended Return or claim for refund,
determining a liability for Taxes or a right to a refund of Taxes, participating
in or conducting any audit or other proceeding in respect of Taxes or making
representations to or furnishing information to parties subsequently desiring to
purchase all or a part of the Business from the Purchaser. Such cooperation and
information shall include providing copies of relevant Returns or portions
thereof, together with accompanying schedules, related work papers and documents
relating to rulings or other determinations by Tax authorities. The Sellers
shall make its employees available on a basis mutually convenient to both
parties to provide explanations of any documents or information provided
hereunder. Each of the Sellers and the Purchaser shall retain all Returns,
schedules and work papers, records and other documents in its possession
relating to Tax matters of the Business for each taxable period first ending
after the Closing Date
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and for all prior taxable periods until the later of (i) the expiration of the
statute of limitations of the taxable periods to which such Returns and other
documents relate, without regard to extensions except to the extent notified by
the other party in writing of such extensions for the respective Tax periods, or
(ii) six years following the due date (without extension) for such Returns. Any
information obtained under this Section 7.05 shall be kept confidential except
as may be otherwise necessary in connection with the filing of Returns or claims
for refund or in conducting an audit or other proceeding.
SECTION 7.06. Conveyance Taxes. The Sellers and the Purchaser
shall be equally liable for and each shall pay one-half of any real property
transfer or gains, sales, use, transfer, value added, stock transfer, and stamp
taxes, any transfer, recording, registration, and other fees, and any similar
Taxes which become payable in connection with the transactions contemplated by
this Agreement. The Sellers, after the review and consent by the Purchaser,
shall file such applications and documents as shall permit any such Tax to be
assessed and paid on or prior to the Closing Date in accordance with any
available pre-sale filing procedure. The Purchaser shall execute and deliver all
instruments and certificates necessary to enable the Sellers to comply with the
foregoing. The Purchaser shall complete and execute a resale or other exemption
certificate with respect to the inventory items sold hereunder, and shall
provide the Sellers with an executed copy thereof.
SECTION 7.07. Section 338(h)(10) Election. (a) Century and the
Purchaser shall jointly make a deemed asset sale election described under Code
section 338(h)(10) (the "CODE SECTION 338(h)(10) ELECTION") and shall make all
corresponding or similar elections under applicable state or local law with
respect to the qualified stock purchase of Shares by the Purchaser hereunder
(collectively, "ELECTIONS"). Century and the Purchaser shall file all such
Elections on a timely basis and comply with all rules and regulations applicable
to such Elections. Century and the Purchaser shall cooperate with each other to
take all actions necessary and appropriate (including filing such forms,
returns, elections, schedules and documents on a joint or separate basis as may
be required) to effect and preserve timely Elections in accordance with
applicable Treasury Regulations under Code section 338 and comparable state or
local laws.
(b) Within sixty (60) calendar days following the Closing
Date, the Purchaser will deliver to Century a completed Internal Revenue Service
Form 8023, and the required schedules thereto ("FORM 8023"), providing for the
Section 338(h)(10) Election. If, within 30 calendar days after the date of
Purchaser's delivery of the Form 8023, Century disputes one or more of the
allocations reflected in items 9a or 11a of Form 8023, Century will give written
notice to the Purchaser setting forth the allocations that Century believes
should be reflected on Form 8023 (but in no event will Century's allocations
reflected in items 9a and 11a of Form 8023 be less than that of the
Purchaser's), and Century and the Purchaser shall be bound by Century's
allocations so long as such allocations are consistent with the terms of this
Agreement, which allocations shall be contained in a revised Form 8023. If
Century reasonably disputes any other allocations or computations reflected on
the Form 8023, Century and the Purchaser will attempt in good faith to promptly
agree on a revised Form 8023. If the parties cannot resolve
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any such dispute within 30 Business Days of the delivery by the Purchaser of the
Form 8023 to Century, the items remaining in dispute shall be submitted to an
independent accounting firm of international reputation selected by, and
mutually acceptable to, Century and the Purchaser. If the independent accounting
firm so selected determines that the allocation with respect to any item or
items remaining in dispute is incorrect and that Century would be materially
adversely affected by the incorrectness of such allocation, then Century and the
Purchaser shall be bound by the allocation of such items as determined by the
independent accounting firm. Otherwise, the Purchaser and Century shall be bound
by the allocation with respect to such item or items as prepared by the
Purchaser. The independent accounting firm shall make any such determination
within 30 Business Days after submission of the remaining disputed items.
SECTION 7.08. Contests. (a) After the Closing Date, each of
the Sellers and the Purchaser shall promptly notify the other party in writing
upon receipt of written notice of the commencement of any Tax audit or
administrative or judicial proceeding or of any demand or claim on the Sellers,
the Purchaser or Century CP which, if determined adversely to the taxpayer or
after the lapse of time, would be grounds for indemnification by the other party
under Section 7.01. Such notice shall contain factual information (to the extent
known to the notifying party) describing the asserted Tax liability in
reasonable detail and shall include copies of any notice or other document
received from any taxing authority in respect of any such asserted Tax
liability. If the indemnitee under Section 7.01 fails to give the indemnitor
under Section 7.01 prompt notice of an asserted Tax liability as required by
this Section 7.08, then the indemnitor shall not have any obligation to
indemnify for any loss arising out of such asserted Tax liability but only to
the extent that failure to give such notice results in a detriment to the
indemnitor.
(b) In the case of an audit or administrative or judicial
proceeding that relates to periods ending on or before the Closing Date, the
Sellers shall have the sole right, at their expense, to control the conduct of
such audit or proceeding, but only to the extent that such audit or proceeding
relates to a Tax for which the Sellers have a potential indemnification
obligation under Section 7.01; provided, however, that if the results of such
contest could reasonably be expected to have a material Tax cost to the
Purchaser or Century CP for any taxable period including or ending after the
Closing Date, then the Sellers and the Purchaser shall jointly control the
defense and settlement of any such contest and each party shall cooperate with
the other party at its own expense and there shall be no settlement or closing
or other agreement with respect thereto without the consent of the other party,
which consent shall not be unreasonably withheld and, if the Sellers do not
assume the defense of any such audit or proceeding, the Purchaser may defend the
same in such manner as it may deem appropriate, including, but not limited to,
settling such audit or proceeding; provided, however, that the Purchaser shall
not settle any such audit or proceeding without the consent of the Sellers,
which consent shall not be unreasonably withheld. If the Sellers choose to
control the contest, the Purchaser shall promptly empower and shall cause
Century CP or other party promptly to empower (by power of attorney and such
other documentation as may be appropriate) such representatives of the Sellers
as they may designate to represent the Purchaser or Century CP or other party or
its successor in the contest insofar as the contest involves an asserted tax
liability for which the Sellers would be liable under Section 7.01. The
Purchaser shall have sole control over the defense and settlement of any contest
relating to taxable periods or portions thereof that begin on or after the
Closing Date (including, subject to Section 7.08(c) hereof, any Taxes allocated
to such period under Section 7.01(b) hereof) or relating to taxable periods or
portions thereof ending on or before the Closing Date
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provided the Taxes to which such contest relates are Taxes for which Sellers are
not liable under Section 7.01(a) hereof, provided, however, that if the results
of any such contest otherwise controlled by the Purchaser could reasonably be
expected to have a material Tax cost or otherwise materially adversely affect
the Sellers, then the Sellers and the Purchaser shall jointly control the
defense and settlement of any such contest and each party shall cooperate with
the other party at its own expense and there shall be no settlement or closing
or other agreement with respect thereto without the consent of the other party,
which consent shall not be unreasonably withheld.
(c) With respect to periods beginning before the Closing Date
and ending after the Closing Date, (i) each party may participate in an audit or
proceeding which relates to any such period and (ii) such audit or proceeding
shall be controlled by that party which would bear the burden of the greater
portion of the sum of the adjustment and any corresponding adjustments that may
reasonably be anticipated for future Tax periods; provided that neither party
shall settle any such audit or proceeding without the consent of the other,
which consent shall not be unreasonably withheld. The principle set forth in the
preceding sentence shall govern also for purposes of deciding any issue that
must be decided jointly (in particular, choice of judicial forum) in situations
in which separate issues are otherwise controlled hereunder by the Purchaser and
the Sellers.
(d) The Purchaser and the Sellers agree to cooperate, and the
Purchaser agrees to cause Century CP to cooperate, in the defense against or
compromise of any claim in any audit or proceeding.
(e) The Sellers shall promptly notify the Purchaser of the
commencement of any claim, audit, examination or other written change or
adjustment received by the Sellers, in each case relating to Century CP, by any
taxing authority which could reasonably be expected to affect the liability of
the Purchaser or Century CP for a material amount of Taxes, and the Sellers
shall keep the Purchaser informed of the progress thereof. The failure to
provide such notice shall not affect the indemnification obligations under this
Article VII unless the indemnified party is materially prejudiced as a result of
such failure.
SECTION 7.09. Miscellaneous. (a) The Sellers and the Purchaser
agree to treat all payments made under Section 2.09 and this Article VII and
under any other indemnity provision contained in this Agreement as adjustments
to the Purchase Price for Tax purposes and that such treatment shall govern for
purposes hereof.
(b) The covenants and obligations of parties under this
Article VII, and the representations and warranties of Sellers set forth in
Section 3.25 hereof, shall survive the Closing and shall remain in full force
and effect until the expiration of all statutes of limitations on assessment or
collection of Tax plus 180 days with respect to any Taxes that would be
indemnifiable by the Sellers under this Agreement.
(c) From and after the date of this Agreement, the Sellers
shall not without the prior written consent of the Purchaser (which consent may
not be unreasonably withheld) make,
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or cause or permit to be made, any Tax election not consistent with prior
practices that could be reasonably expected to have a Material Adverse Effect.
(d) The Sellers and the Purchaser agree that the fair market
value of the assets of Century CP, in the aggregate, generally equals the
adjusted tax basis in those assets as of the date of this Agreement.
(e) For purposes of this Article VII, all references to the
Purchaser, the Sellers, Century CP and the Subsidiaries include successors.
(f) All tax sharing agreements or similar agreements with
respect to or involving the Sellers and Century CP shall be terminated with
respect to Century CP as of the Closing Date and, after the Closing Date,
Century CP shall not be bound thereby or have any liability thereunder.
ARTICLE VIII
CONDITIONS TO CLOSING
SECTION 8.01. Conditions to Obligations of the Sellers.
Subject to the proviso in Section 10.01(b), the obligations of the Sellers to
consummate the transactions contemplated by this Agreement shall be subject to
the fulfillment, at or prior to the Closing, of each of the following
conditions:
(a) Representations, Warranties and Covenants. (i) The
representations and warranties of the Purchaser contained in this
Agreement shall be true and correct as of the Closing, with the same
force and effect as if made as of the Closing Date; except to the
extent that any inaccuracies as of the Closing Date in the
representations and warranties would not be reasonably likely to have,
individually or in the aggregate, a material adverse effect on the
ability of the Purchaser to consummate the transactions contemplated by
this Agreement (provided that for purposes of determining whether any
representation or warranties are inaccurate as of the Closing Date any
representation or warranty that is qualified by a standard of
materiality shall be required to be true in all respects without giving
effect to such materiality standard), (ii) the covenants and agreements
contained in this Agreement to be complied with by the Purchaser on or
before the Closing shall have been complied with in all material
respects, and (iii) the Sellers shall have received a certificate from
the Purchaser to such effect signed by a duly authorized officer
thereof;
(b) HSR Act. Any waiting period (and any extension thereof)
under the HSR Act applicable to the purchase of the Assets contemplated
by this Agreement shall have expired or shall have been terminated;
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(c) No Proceeding or Litigation. No Action shall have been
commenced by or before any Governmental Authority against either the
Sellers or the Purchaser, seeking to restrain or materially and
adversely alter the transactions contemplated by this Agreement which
is reasonably likely to render it impossible or unlawful to consummate
such transactions; provided, however, that the provisions of this
Section 8.01(c) shall not apply if the Sellers have directly or
indirectly solicited or encouraged any such Action;
(d) Ancillary Agreements. The Purchaser shall have executed
and delivered to the Sellers each of the Ancillary Agreements to which
it or any of its Affiliates is a party;
(e) Resolutions of the Purchaser. The Sellers shall have
received a true and complete copy, certified by a duly authorized
officer of the Purchaser, of the resolutions duly and validly adopted
by the Board of Directors of the Purchaser evidencing its authorization
of the execution and delivery of this Agreement and the Ancillary
Agreements and the consummation of the transactions contemplated hereby
and thereby.
SECTION 8.02. Conditions to Obligations of the Purchaser.
Subject to the proviso in Section 10.01(a), the obligations of the Purchaser to
consummate the transactions contemplated by this Agreement shall be subject to
the fulfillment, at or prior to the Closing, of each of the following
conditions:
(a) Representations, Warranties and Covenants. (i) The
representations and warranties of the Sellers contained in this
Agreement shall be true and correct as of the Closing with the same
force and effect as if made as of the Closing, except to the extent
that any inaccuracies as of the Closing Date in the representations and
warranties would not be reasonably likely to have, individually or in
the aggregate, a Material Adverse Effect (provided that for purposes of
determining whether any representations or warranties are inaccurate as
of the Closing Date any representation or warranty that is qualified by
a standard of materiality shall be required to be true in all respects
without giving effect to such materiality standard; provided that
solely for purposes of this Section 8.02(a), if there is any
circumstance, change in or effect on the Business whose adverse effect
on the Business is monetary, such circumstance, change or effect shall
be deemed to be a Material Adverse Effect if such monetary liability is
greater than $15,000,000); (ii) the covenants and agreements contained
in this Agreement to be complied with by the Sellers on or before the
Closing shall have been complied with in all material respects except
that the Sellers shall have complied in all respects with their
obligations under Article II hereof, and (iii) the Purchaser shall have
received a certificate of the Sellers to such effect signed by duly
authorized officers thereof;
(b) HSR Act. Any waiting period (and any extension thereof)
under the HSR Act applicable to the purchase of the Assets contemplated
hereby shall have expired or shall have been terminated;
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(c) No Proceeding or Litigation. No Action shall have been
commenced by or before any Governmental Authority against either the
Sellers or the Purchaser, seeking to restrain or materially and
adversely alter the transactions contemplated by this Agreement which
is reasonably likely to render it impossible or unlawful to consummate
such transactions or which would be reasonably likely to have a
Material Adverse Effect; provided, however, that the provisions of this
Section 8.02(c) shall not apply if the Purchaser has solicited or
encouraged any such Action;
(d) Resolutions of the Sellers. The Purchaser shall have
received a true and complete copy, certified by the Secretary or an
Assistant Secretary of each of the Sellers, of the resolutions duly and
validly adopted by the Board of Directors of each of the Sellers and
the stockholders of Century WV evidencing their authorization of the
execution and delivery of this Agreement and the Ancillary Agreements
to which it is a party and the consummation of the transactions
contemplated hereby and thereby;
(e) Consents and Approvals. The Purchaser and the Sellers
shall have received, each in form and substance reasonably satisfactory
to the Purchaser, all authorizations, consents, orders and approvals of
all Governmental Authorities and officials which are necessary for the
consummation of the transactions contemplated by this Agreement and the
Ancillary Agreements or for the conduct of the Business by the
Purchaser immediately after giving effect to the Closing, except where
the failure to obtain any such authorizations, consents, orders or
approvals would not be reasonably likely to have, individually or in
the aggregate, a Material Adverse Effect after giving effect to
consummation of the transactions contemplated by this Agreement and the
Ancillary Agreements;
(f) Resignations. The Purchaser shall have received the
resignations, effective as of the Closing, of all directors and
officers of Century CP, except for such persons as shall have been
designated in writing prior to the Closing by the Purchaser to the
Sellers;
(g) Minute Books. The Purchaser shall have received a copy of
the minute books and stock register of Century CP, certified by the
Secretary or Assistant Secretary of Century CP, as of the Closing;
(h) Good Standing; Qualification to Do Business. The Purchaser
shall have received good standing certificates for Century CP from the
secretary of state of the jurisdiction in which such entity is
incorporated or organized and from the secretary of state in each other
jurisdiction in which the failure of Century CP to qualify to do
business as a foreign corporation would be reasonably likely to have a
material and adverse effect on the business of Century CP, in each case
dated as of a date not earlier than ten Business Days prior to the
Closing Date and accompanied by bring-down telegrams dated the Closing
Date;
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(i) Ancillary Agreements. Each of the Sellers or its
Affiliates shall have executed and delivered to the Purchaser each of
the Ancillary Agreements to which a Seller or any of its Affiliates is
a party;
(j) No Material Adverse Effect. No circumstance, change in, or
effect on the Business shall have occurred which has or, with the
passage of time is reasonably expected to have, individually or in the
aggregate, a Material Adverse Effect; provided that to the extent any
such circumstance, change or effect on the Business results in an
inaccuracy as of the Closing Date in the representations and warranties
of the Sellers, such circumstance, change or effect shall not be
separately considered under this Section 8.02(j) for purposes of
determining whether a Material Adverse Effect has occurred or is
reasonably expected to occur;
(k) New Collective Bargaining Agreement. The collective
bargaining agreement with the United Steelworkers of America (the
"USWA") entered into and agreed upon by Century WV effective June 1,
1999 and the terms thereof are effective and binding on the parties and
have not been amended since such date;
(l) Major Customer. (i) The Major Customer shall have
consented to the assignment to the Purchaser of the Sellers' rights and
obligations under the agreements entered into with such Major Customer
and the Major Customer shall not have terminated or materially and
adversely altered, or given notice that it intends to terminate or
materially and adversely alter, its commercial arrangements with the
Business and (ii) The Lockheed Xxxxxx Corporation ("LOCKHEED") shall
have consented to the assignment to the Purchaser of Century WV's
rights and obligations under the agreements entered into with Lockheed
in October 1998;
(m) Taxes and Fees. The Sellers shall have paid one-half of
all transfer, deed, gains, stamp and all other similar taxes and
special assessments and recording charges, if any;
(n) Title Policy. The Purchaser shall have received, at its
sole cost and expense, an owner's form of policy or policies of title
insurance, dated or updated to the Closing Date (the "TITLE POLICY")
with liability in the amount reasonably specified by the Purchaser,
insuring that the Purchaser has a good and marketable fee estate in and
to the Owned Real Property subject only to the Permitted Encumbrances
and the Permitted Property Encumbrances. The Title Policy shall be
issued by a title company satisfactory to the Purchaser (the "TITLE
COMPANY"), and shall insure (to the extent insurable) any easements,
leasehold estates or other matters appurtenant to or benefitting the
Owned Real Property as part of the insured estate. In the event
delivery of the Title Policy is not possible as of the Closing,
Purchaser shall have received at the Closing the irrevocable and
unconditional binding commitment of the Title Company to issue the
Title Policy in the form of a so-called "pro-forma policy", or "marked
binder";
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(o) Title Indemnity. The Sellers shall have provided to the
Title Company a "gap" indemnity, indemnifying the Title Company against
matters affecting title (other than Permitted Encumbrances) between the
Closing Date and the date of recordation of the Deed or Deeds;
(p) Title Proof. The Sellers shall have provided to the Title
Company such reasonable and customary title affidavits, indemnities,
undertakings and "proofs" as may be customary in the jurisdiction in
which the Owned Real Property is situated or as may be reasonably
required by the Title Company;
(q) Survey. The Purchaser shall have received, at least ten
(10) days prior to the Closing, at the Sellers' sole cost and expense,
an "as-built" survey or surveys of the Owned Real Property reasonably
satisfactory to the Purchaser, certified to the Purchaser and the Title
Company by a licensed surveyor approved by the Purchaser, dated or
updated not earlier than sixty (60) days prior to the Closing,
complying with the latest edition of the ALTA and ASCM Minimum Standard
Detail Requirements for Land Title Surveys, including Table A items
reasonably requested by the Purchaser;
(r) Easements. The Sellers, at their sole cost and expense,
shall have executed, acknowledged and recorded such easements as shall
be necessary for the Purchaser to operate the Business, including,
without limitation, those easements contemplated in Schedule 8.02(r);
(s) Conveyance. The conveyance of the Owned Real Property
shall be in compliance with all material zoning, subdivision, land use,
and other Laws, and the Owned Real Property shall be assessed as a
separate tax lot for real property tax assessment purposes;
(t) Certificate of Non-Foreign Status. The Purchaser shall
have received a certificate from the Sellers (which complies with
Section 1445 of the Code) of non-foreign status executed in accordance
with the provisions of the Foreign Investment in Real Property Tax Act;
and
(u) Utilities. The Purchaser shall have rights to obtain from
the utility provider utilities on terms and conditions, including cost,
similar to those currently in effect.
(v) Environmental Permits. All Environmental Permits required
for the Purchaser, as the new owner of the Assets, to conduct the
Business as of the Closing shall be in full force and effect except (i)
as would not be reasonably likely to have, individually or in the
aggregate, a Material Adverse Effect, and (ii) as would not materially
and adversely affect the Purchaser's ability to operate the Business.
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ARTICLE IX
INDEMNIFICATION
SECTION 9.01. Survival of Representations and Warranties. The
representations and warranties of the Purchaser and the Sellers contained in
this Agreement shall survive the Closing until the second anniversary thereof;
provided, however, that (a) the representations and warranties of the Sellers
dealing with Tax matters shall survive as provided in Article VII, (b) insofar
as any claim is made by the Purchaser for the breach of any representation or
warranty of the Sellers contained herein relating to environmental matters, such
representations and warranties shall, for purposes of such claims by the
Purchaser, survive the Closing until the sixth anniversary of the Closing, and
(c) the representations and warranties contained in Section 3.01 (other than the
second sentence thereof) shall survive the Closing until the fourth anniversary
thereof. Neither the period of survival nor the liability of the Sellers with
respect to the Sellers' representations and warranties shall be reduced by any
investigation made at any time by or on behalf of the Purchaser. If written
notice of a claim has been given in good faith prior to the expiration of the
applicable representations and warranties by the Purchaser to the Sellers
pursuant to Section 9.04, then the relevant representations and warranties shall
survive as to such claim until the claim has been finally resolved.
SECTION 9.02. Indemnification by the Sellers. (a) Subject to
Section 9.01, the Sellers shall, jointly and severally, indemnify, defend and
hold harmless the Purchaser and its Affiliates, officers, directors, employees,
agents, successors and assigns (each a "PURCHASER INDEMNIFIED PARTY") for any
and all Liabilities, losses, damages, claims, costs and expenses, interest,
awards, judgments and penalties (including, without limitation, reasonable
attorneys' and consultants' fees and expenses) actually suffered or incurred
(including, without limitation, any Action brought or otherwise initiated by any
of them) (hereinafter a "LOSS") by them, arising out of or resulting from:
(i) the breach of any representation or warranty made by the
Sellers contained in this Agreement (other than in respect of Taxes and
other amounts indemnified against under Article VII, it being
understood that the rights and obligations of the parties with respect
to indemnification for any and all Tax matters shall be governed by
Article VII); or
(ii) the breach of any covenant or agreement by the Sellers
contained in this Agreement (other than any covenant in Article VII, it
being understood that the rights and obligations of the parties with
respect to indemnification for any and all Tax matters shall be
governed by Article VII); or
(iii) with the exception of Losses associated with items set
forth in Section 3.16(a) of the Disclosure Schedule, (A) any Releases
of Hazardous Material requiring an investigation or remediation under
any applicable Environmental Law at, on, under, migrating from (but
only to the extent migrating on or prior to the Closing) or to, or
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transported from (but only to the extent transported on or prior to the
Closing) the Real Property, or any property formerly owned, leased,
occupied or used by the Sellers, Century CP or the Business but only
during the period in which such former property was owned, leased,
occupied or used by any such Person, in any such case on or prior to
the Closing; or any continuing migration of such Hazardous Material
from the Real Property after the Closing (including, without
limitation, any Remedial Action at any time after the Closing relating
to such Hazardous Material), except (I) in respect of matters set forth
in Section 3.16(a) of the Disclosure Schedule, if the Purchaser's
actions or inactions are the cause of such off-site migration or (II)
in respect of any other pre-Closing disposal or Release at the Real
Property, if the Purchaser's negligence is the cause of such off-site
migration; (B) any Environmental Claim arising at any time that relates
to the Sellers, Century CP, the Business or the Real Property on or
prior to the Closing; or (C) any noncompliance with or violation of any
applicable Environmental Law or Environmental Permit relating in any
way to the Sellers or the Business on or prior to the Closing, or any
continuation of such violation or non-compliance after the Closing; or
(iv) Liabilities relating to or arising from employee claims
described in Section 2.02(b)(iv) to the extent such claims exceed the
amount described in such Section; or
(v) without prejudice to Section 6.07, any action taken by the
PBGC relating to the defined benefit pension plans maintained prior to
the Closing by the Sellers for the Transferred Employees or to the
assets of the Sellers which are not the Shares and Rolling Assets
purchased hereunder; or
(vi) Liabilities arising from or related to any failure to
comply with laws relating to bulk transfers or bulk sales with respect
to the transactions contemplated by this Agreement; or
(vii) the Excluded Liabilities; or
(viii) except as otherwise provided in Article VI, Liabilities
for benefits, or under any of Century CP's Plans; or
(ix) Liabilities relating to or arising out of Actions brought
against Century CP (other than worker's compensation claims) associated
with employment actions, omissions or events, including, without
limitation, employment discrimination claims, and claims for workplace
related injuries by employees which occurred or were incurred or
accrued on or before the Closing Date, but only to the extent such
Liabilities (together with all Liabilities relating to or arising from
employee claims described in Section 2.02(b)(iv)), individually or in
the aggregate, exceeded $600,000; or
(x) all Liabilities of Century CP in the nature of product
liability claims relating to or arising out of allegations of personal
injury or property damage suffered by any third party (A) on or prior
to the Closing Date or (B) attributable to products sold or
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shipped, or Inventory purchased or manufactured, in each case in
respect of the conduct of the Rolling Business on or prior to the
Closing Date; or
(xi) Liabilities under Environmental Laws relating to or
arising out of (A) Hazardous Material transported from the Xxxxxx Owned
Real Property pre-Closing; (B) any off-site migration of Hazardous
Material resulting from any pre-Closing off-site disposal or Release of
such Hazardous Material; (C) any off-site migration of Hazardous
Material from the Xxxxxx Owned Real Property resulting from any
pre-Closing disposal or Release at the Xxxxxx Owned Real Property,
except (I) in respect of matters set forth in Section 3.16(a) of the
Disclosure Schedule, if the Purchaser's actions or inactions are the
cause of such off-site migration or (II) in respect of any other
pre-Closing disposal or Release at the Xxxxxx Owned Real Property, if
the Purchaser's negligence is the cause of such off-site migration; and
(D) any on-site PCB contamination existing or occurring on or before
the Closing at the Xxxxxx Owned Real Property, or any off-site PCB
contamination, whether existing or occurring before or after the
Closing, resulting from or arising out of operations at the Xxxxxx
Owned Real Property on or before the Closing, in each case requiring
investigation or remediation or other action under applicable
Environmental Law; it being understood that for purposes of this clause
9.02(a)(xi)(D), "Environmental Laws" include regulations adopted by the
State of California or a subdivision thereof after the Closing Date
pursuant to statutes enacted before the Closing Date; or
(xii) Indebtedness of Century CP, other than obligations under
equipment leases that have, or should have, been recorded as capital
leases.
(b) To the extent that the Sellers' undertakings set forth in
this Section 9.02 may be unenforceable, each Seller shall contribute the maximum
amount that it is permitted to contribute under applicable Law to the payment
and satisfaction of all Losses incurred by a Purchaser Indemnified Party.
(c) The Sellers shall not be required to indemnify any
Purchaser Indemnified Party under (1) Section 9.02(a)(i) (except to the extent a
claim relates to or arises from the breach of any representation or warranty
contained in Sections 3.01 (other than the second sentence thereof) or 3.31),
(2) Section 9.02(a)(ii), (3) Section 9.02(a)(iii) (except to the extent a claim
relates to or arises from the Excluded Liabilities set forth in Section
2.02(b)(vi) (other than Section 2.02(b)(vi)(C) or Section 9.02(a)(xi) (other
than Section 9.02(a)(xi)(C)), for which there is no indemnity limit) and (4)
Section 9.02(a)(v), unless (x) such claim or demand involves Losses in excess of
$50,000 and (y) the aggregate amount of all Losses for which indemnity is due
exceeds $2,000,000, after which (subject to Section 9.06) the Sellers shall be
obligated for all Losses of the Purchaser Indemnified Parties in excess of such
amount. Claims or demands which are based on the same or similar or related
facts shall be treated as a single claim when determining whether the threshold
set out in Section 9.02(c)(x) has been reached. Any indemnifiable liability with
respect to any breach or non-performance by the Sellers of a representation,
warranty or covenant shall be limited to the amount of damages sustained by a
Purchaser Indemnified Party by reason of such breach or non-performance net of
any reserves provided for such liability on the Reference Balance Sheet.
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SECTION 9.03. Indemnification by the Purchaser. (a) Subject to
Section 9.01, the Purchaser shall indemnify, defend and hold harmless the
Sellers and their Affiliates (other than Century CP), officers, directors,
employees, agents, successors and assigns (each a "SELLER INDEMNIFIED PARTY")
for any and all Losses actually suffered or incurred by them, arising out of or
resulting from:
(i) the breach of any representation or warranty made by the
Purchaser contained in this Agreement; or
(ii) the breach of any covenant or agreement by the Purchaser
contained in this Agreement (including, without limitation, any
covenant in Article VII); or
(iii) any liabilities or obligations resulting from or arising
out of the conduct of the Business on or after the Closing Date, except
for any liabilities or obligations with respect to which the Sellers
are obligated to indemnify a Purchaser Indemnified Party; or
(iv) any action taken by the PBGC relating to the New Defined
Benefit Plans or to the Shares and Rolling Assets purchased hereunder;
or
(v) liabilities and obligations arising from employee claims
described in Section 2.02(a)(iii) to the extent such claims do not
exceed the amounts described in such Section.
(b) To the extent that the Purchaser's undertakings set forth
in this Section 9.03 may be unenforceable, the Purchaser shall contribute the
maximum amount that it is permitted to contribute under applicable Law to the
payment and satisfaction of all Losses incurred by a Seller Indemnified Party.
SECTION 9.04. Notification of Claims. (a) A party that may be
entitled to be indemnified pursuant to Section 9.02 or 9.03 (the "INDEMNIFIED
PARTY") shall promptly notify the party liable for such indemnification (the
"INDEMNIFYING PARTY") in writing of any pending or threatened claim or demand
which the Indemnified Party has determined has given or could give rise to a
right of indemnification under this Agreement (including a pending or threatened
claim or demand asserted by a third party ("THIRD PARTY CLAIMS") against the
Indemnified Party), describing in reasonable detail the facts and circumstances
with respect to the subject matter of such claim or demand; provided, however,
that the failure to provide such notice shall not release the Indemnifying Party
from any of its obligations under this Article IX except to the extent the
Indemnifying Party is materially prejudiced by such failure. Subject to the
Indemnifying Party's right to defend in good faith Third Party Claims as
hereinafter provided, the Indemnifying Party shall (whether in respect of a
claim which is not a third party claim or in respect of a Third Party Claim)
satisfy or contest its obligations under this Article IX within 15 days after
the receipt of written notice thereof from the Indemnified Party.
(b) If the Indemnifying Party acknowledges in writing its
obligation to indemnify the Indemnified Party hereunder against any Losses that
may result from such Third Party Claim, then the Indemnifying Party shall be
entitled to assume and control the defense of such Third Party Claim at its
expense and through counsel of its choice if it gives notice of its
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intention to do so to the Indemnified Party within 15 days of the receipt of
such notice from the Indemnified Party; provided, however, that the Indemnified
Party may participate in such defense and retain separate counsel at its own
cost and expense, without prejudice to the rights of the parties to control the
defense of their respective interests. In the event the Indemnifying Party
exercises the right to undertake any such defense against any such Third Party
Claim as provided above, the Indemnified Party shall cooperate with the
Indemnifying Party in such defense and make available to the Indemnifying Party,
at the Indemnifying Party's expense, all witnesses, pertinent records, materials
and information in the Indemnified Party's possession or under the Indemnified
Party's control relating thereto as is reasonably required by the Indemnifying
Party. Similarly, in the event the Indemnified Party is, directly or indirectly,
conducting the defense against any such Third Party Claim, the Indemnifying
Party shall cooperate with the Indemnified Party in such defense and make
available to the Indemnified Party, at the Indemnifying Party's expense, all
such witnesses, records, materials and information in the Indemnifying Party's
possession or under the Indemnifying Party's control relating thereto as is
reasonably required by the Indemnified Party. No such Third Party Claim may be
settled by the Indemnifying Party without the written consent of the Indemnified
Party (which consent shall not be unreasonably withheld).
SECTION 9.05. Limits on Environmental Indemnification. (a) The
Purchaser and the Sellers, as the case may be, may investigate, or cause to be
investigated, the existence or the nature or extent of any release of Hazardous
Materials and conduct any Remedial Action at or from the Real Property if such
investigation is required by applicable Environmental Laws. The Sellers and the
Purchaser shall consult with a view to determining what Remedial Action, if any
is required, and any Remedial Action and any compliance activities shall be
designed to assure the most cost effective action possible, consistent with
applicable Environmental Laws. Any payments or expenses expended as required by
a Governmental Order, a written demand for remedial or compliance action or a
written demand for payment by any Governmental Authority shall be deemed to be
consistent with the exercise of reasonable business judgment. The Purchaser
shall mitigate to the extent practicable, any environmental Loss for which
indemnification is claimed. If the Purchaser, by expenditure of money,
reasonably can mitigate or otherwise reduce or eliminate any environmental Loss
for which indemnification otherwise would be claimed, the Purchaser shall take
such action and shall be entitled to prompt reimbursement from the Sellers for
such expenditures and all related expenses.
(b) If the Purchaser and the Sellers are unable, after
reasonable inquiry, to determine whether a particular environmental Loss falls
within Section 9.02(a)(iii) ("SECTION 9.02(A)(III) LOSS") or Section 9.03
("SECTION 9.03 LOSS"), the parties shall refer the matter to a mutually
acceptable environmental lawyer (the "INDEPENDENT EXPERT"). The Independent
Expert shall be experienced in the environmental issues involved in the dispute
and shall not in the past have been engaged by either the Purchaser or the
Sellers and shall not otherwise be affiliated with either the Purchaser or the
Sellers. Within ten (10) Business Days following the selection of the
Independent Expert the Purchaser and the Sellers shall each submit to such
Independent Expert, in writing not to exceed ten (10) pages in length, such
party's proposed resolution of the matter in question, together with reasonable
documentary evidence supporting such proposed resolution. The Independent Expert
shall have the authority to request additional facts or evidence from each of
the parties, and if such Independent Expert so requires, a hearing to present
the same. The Independent Expert, shall within 40 Business Days from his or her
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appointment, make a determination as to whether, and to what extent, such Loss
(i) is a Section 9.02(a)(iii) Loss, (ii) is a Section 9.03 Loss or (iii) in his
or her expert opinion, cannot be clearly determined to be either a Section
9.02(a)(iii) Loss or a Section 9.03 Loss in whole or in part. The Independent
Expert's determination shall be final and binding on the parties. The costs and
expenses of the Independent Expert shall be shared equally by the parties.
(c) If the Independent Expert cannot clearly determine whether
a particular Loss is, in whole or in part, a Section 9.02(a)(iii) Loss or a
Section 9.03 Loss, the Sellers and the Purchaser will indemnify each other so as
to allocate responsibility between themselves, according to the time when such
Loss occurs, as follows:
Time Loss Occurs Sellers' Share of Purchaser's Share of
---------------- ----------------- --------------------
Responsibility Responsibility
-------------- --------------
From the Closing Date through one year 100% 0%
after the Closing Date
Thereafter through two years after the 83.3% 16.7%
Closing Date
Thereafter through three years after 67.7% 33.3%
the Closing Date
Thereafter through four years after 50% 50%
the Closing Date
Thereafter through five years after 33.3% 67.7%
the Closing Date
Thereafter through six years after the 16.7% 83.3%
Closing Date
After six years of the Closing Date 0% 100%
SECTION 9.06. Limits on Indemnification. Notwithstanding
anything to the contrary contained in this Agreement, the maximum amount of
indemnifiable Losses which may be recovered from the Sellers arising out of or
resulting from the causes enumerated in (a) Section 9.02(a)(i) (with the
exception of any Losses relating to arising from the breach of any
representation or warranty contained in Sections 3.01 (other than the second
sentence thereof) or 3.31) or (b) Section 9.02(a)(iii) (with the exception of
any Losses relating to or arising from the Excluded Liabilities set forth in
Section 2.02(b)(vi) (other than Section 2.02(b)(vi)(C)) or Section 9.02(a)(xi)
(other than Section 9.02(a)(xi)(C)) for which there is no indemnity limit) shall
be an amount equal to $25,000,000.
SECTION 9.07. Indemnification Agreements. The parties hereto
agree that to the extent the Purchaser or any other Purchaser Indemnified Party
may be entitled to indemnification pursuant to either the Xxxxxx Indemnity
Agreement or the Ravenswood Indemnity Agreement,
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on the one hand, or this Agreement, on the other hand, the Purchaser or any
other Purchaser Indemnified Party, as the case may be, shall be entitled to seek
indemnification under any one or more of such agreements; provided that to the
extent a claim is made under one or more of such agreements, the validity of
such claim shall be determined separately under each such agreement and to the
extent valid under more than one such agreement, the Purchaser may elect under
which agreement or agreements the Sellers shall make such indemnification
payment (and any amounts payable in respect of such claim shall be determined in
accordance with the terms and conditions of the agreement or agreements
designated by the Purchaser and such amounts paid shall not be taken into
consideration for purposes of determining the deductible or the maximum amount
recoverable under any other agreement), provided that any recovery in respect of
such claim shall be limited to the amount of Loss in respect of such claim.
SECTION 9.08. Exclusive Remedies. The parties hereto
acknowledge and agree that following the Closing the indemnification provisions
of this Article IX, the Xxxxxx Indemnity Agreement and the Kaiser Indemnity
Agreement shall be the sole and exclusive remedies of, on the one hand, the
Sellers against the Purchaser, and on the other hand, the Purchaser against the
Sellers, for any breach of the representations, warranties, covenants or
agreements herein or therein (as applicable in accordance with the terms of the
indemnity provisions of each such agreement), except (i) for performance of the
obligations set forth in Article II and Sections 5.03, 5.07, and 5.12, (ii) for
performance of the obligations set forth in Article VII, as to which the
obligations of the parties with respect to indemnification shall be exclusively
governed by Article VII, (iii) for injunctive relief or specific performance to
the extent available at Law, and (iv) in the event of willful breach, willful
misrepresentation or fraud.
SECTION 9.09. Sellers' Indemnity Support. The parties hereto
agree that for so long as and at such times as the consolidated net worth of
Century is less than $200,000,000, at the Seller's option:
(a) for so long as the Purchaser shall be entitled to be
indemnified pursuant to Article VII or Article IX, the Xxxxxx Indemnity
Agreement or the Ravenswood Indemnity Agreement, upon delivery pursuant
to Article VII or Section 9.04, the Xxxxxx Indemnity Agreement or the
Ravenswood Indemnity Agreement by a Purchaser Indemnified Party of a
notice regarding an indemnification claim or potential claim, the
Purchaser is hereby authorized at any time and from time to time, to
the fullest extent permitted by Law, to set off (for so long as such
claim is pending) against any and all amounts due and payable by the
Purchaser to the Sellers under this Agreement, any Ancillary Agreement
or otherwise an amount equal to the amount of such claim, but in no
event shall any such set-off pursuant to this Section 9.09(a) exceed
$5,000,000; provided that the Purchaser shall promptly return any
amount set off (plus interest thereon accruing at the average of the
prime rate applicable during the period of set off) if and to the
extent a court or judicial body of applicable jurisdiction shall
determine that the Sellers are not liable to the Purchaser Indemnified
Party for such claim; or
(b) the Sellers shall obtain (and maintain in effect for so
long as the Purchaser shall be entitled to be indemnified pursuant to
Article VII or IX, the Xxxxxx Indemnity Agreement or the Ravenswood
Indemnity Agreement) an insurance policy, in form and substance
reasonably satisfactory to the Purchaser, issued in favor of the
Purchaser and its Affiliates from an insurer acceptable to the
Purchaser, in its reasonable judgment,
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providing at least $5,000,000 of coverage for amounts that are payable
by the Sellers to a Purchaser Indemnified Party pursuant to the
indemnification provisions set forth in Article VII or IX, the Xxxxxx
Indemnity Agreement or the Ravenswood Indemnity Agreement; and the
Sellers and the Purchaser agree that the Sellers, on the one hand, and
the Purchaser, on the other hand, shall each pay one half of the
premiums payable in connection with obtaining and maintaining such
insurance policy; provided that in no event shall the Purchaser be
required to pay more than $100,000 in the aggregate in premiums or
other payments in connection with obtaining and maintaining such
insurance policy.
ARTICLE X
TERMINATION AND WAIVER
SECTION 10.01. Termination. This Agreement may be terminated
at any time prior to the Closing:
(a) by the Purchaser, if between the date hereof and the time
scheduled for the Closing, any Seller or Subsidiary makes a general
assignment for the benefit of creditors, or any proceeding shall be
instituted by or against any Seller or Subsidiary seeking to adjudicate
it a bankrupt or insolvent, or seeking liquidation, winding up or
reorganization, arrangement, adjustment, protection, relief or
composition of its debts under any Law relating to bankruptcy,
insolvency or reorganization and such proceeding is not dismissed
within 90 days, provided that the Purchaser shall not be required to
consummate the transactions contemplated by this Agreement until such
proceeding has been dismissed; or
(b) by the Sellers, if between the date hereof and the time
scheduled for the Closing, the Purchaser makes a general assignment for
the benefit of creditors, or any proceeding shall be instituted by or
against the Purchaser seeking to adjudicate it a bankrupt or insolvent,
or seeking liquidation, winding up or reorganization, arrangement,
adjustment, protection, relief or composition of its debts under any
Law relating to bankruptcy, insolvency or reorganization and such
proceeding is not dismissed within 90 days, provided that the Sellers
shall not be required to consummate the transactions contemplated by
this Agreement until such proceeding has been dismissed; or
(c) by either the Sellers or the Purchaser if the Closing
shall not have occurred by January 26, 2000; provided, however, that
the right to terminate this Agreement under this Section 10.01(c) shall
not be available to any party whose failure to fulfill any obligation
under this Agreement shall have been the cause of, or shall have
resulted in, the failure of the Closing to occur on or prior to such
date; or
(d) by either the Purchaser or the Sellers in the event that
any Governmental Authority shall have issued an order, decree or ruling
or taken any other action restraining, enjoining or otherwise
prohibiting the transactions contemplated by this
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Agreement and such order, decree, ruling or other action shall have
become final and nonappealable; or
(e) by the mutual written consent of the Sellers and the
Purchaser.
SECTION 10.02. Effect of Termination. In the event of
termination of this Agreement as provided in Section 10.01, this Agreement
(including, without limitation, Section 5.07) shall forthwith become void and
there shall be no liability on the part of either party hereto except (a) as set
forth in Sections 10.02(b), 11.01 and 11.03 and (b) that nothing herein shall
relieve either party from liability for any breach of this Agreement.
SECTION 10.03. Waiver. Either party to this Agreement may (a)
extend the time for the performance of any of the obligations or other acts of
the other party, (b) waive any inaccuracies in the representations and
warranties of the other party contained herein or in any document delivered by
the other party pursuant hereto or (c) waive compliance with any of the
agreements or conditions of the other party contained herein. Any such extension
or waiver shall be valid only if set forth in an instrument in writing signed by
the party to be bound thereby. Any waiver of any term or condition shall not be
construed as a waiver of any subsequent breach or a subsequent waiver of the
same term or condition, or a waiver of any other term or condition, of this
Agreement. The failure of any party to assert any of its rights hereunder shall
not constitute a waiver of any of such rights.
ARTICLE XI
GENERAL PROVISIONS
SECTION 11.01. Expenses. Except as otherwise specified in this
Agreement, all costs and expenses, including, without limitation, fees and
disbursements of counsel, financial advisors and accountants, incurred in
connection with this Agreement and the transactions contemplated hereby shall be
paid by the party incurring such costs and expenses, whether or not the Closing
shall have occurred, provided that Century shall pay all such costs and expenses
incurred by the Sellers.
SECTION 11.02. Notices All notices, requests, claims, demands
and other communications hereunder shall be in writing and shall be given or
made (and shall be deemed to have been duly given or made upon receipt) by
delivery in person, by courier service, by telecopy or by registered or
certified mail (postage prepaid, return receipt requested) to the respective
parties at the following addresses (or at such other address for a party as
shall be specified in a notice given in accordance with this Section 11.02):
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(a) if to the Sellers:
Century Aluminum Company
0000 Xxxxxx Xxxx
Xxxxxxxx X, Xxxxx 000
Xxxxxxxx, Xxxxxxxxxx 00000
Telecopy: (000) 000-0000
Attention: General Counsel and
Chief Administrative Officer
with a copy to:
Xxxxxx, Xxxxxx-Xxxxxxx, Colt & Mosle
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Telecopy: (000) 000-0000
Attention: Xxxxxx X. Xxxx, Esq.
(b) if to the Purchaser:
Pechiney Rolled Products LLC
0000 Xxxx Xxxx Xxxx Xxxxxx
Telecopy: (000) 000-0000
Attention: Xxxxxx Xxxxx Xxxxx
with a copy to:
Pechiney
0, xxxxx xx Xxxxxxxxxx Xxxxxxxx
00000 Xxxxx
Xxxxxx
Telecopy: (00-0) 00 00 00 00
Attention: Xxxx X. Xxxxx
and
Shearman & Sterling
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Telecopy: (000) 000-0000
Attention: Xxxxx X. Xxxxxxxx, Esq.
Xxxxxx X. Xxxx, Xx., Esq.
SECTION 11.03. Public Announcements. Until a public
announcement has been made pursuant to this Section 11.03, except as may be
required by Law or stock exchange rules, no party to this Agreement shall make,
or cause to be made, any press release or public announcement in respect of this
Agreement or the transactions contemplated hereby or otherwise
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communicate with any news media without the prior written consent of the other
parties, and the parties shall cooperate as to the timing and contents of any
such press release or public announcement. Notwithstanding the foregoing, where
an announcement is required by Law or stock exchange rules, the party required
to make such an announcement shall notify the other parties of such requirement
(and provide a copy of such announcement to the other parties) as soon as
practicable in advance of such announcement and, to the extent practical, take
the views of the other parties in respect of such announcement into account
prior to making such announcement.
SECTION 11.04. Headings. The descriptive headings contained in
this Agreement are for convenience of reference only and shall not affect in any
way the meaning or interpretation of this Agreement.
SECTION 11.05. Severability. If any term or other provision of
this Agreement is invalid, illegal or incapable of being enforced by any Law or
public policy, all other terms and provisions of this Agreement shall
nevertheless remain in full force and effect so long as the economic or legal
substance of the transactions contemplated hereby is not affected in any manner
materially adverse to any party. Upon such determination that any term or other
provision is invalid, illegal or incapable of being enforced, the parties hereto
shall negotiate in good faith to modify this Agreement so as to effect the
original intent of the parties as closely as possible in an acceptable manner in
order that the transactions contemplated hereby are consummated as originally
contemplated to the greatest extent possible.
SECTION 11.06. Entire Agreement. This Agreement and the
Ancillary Agreements constitute the entire agreement of the parties hereto with
respect to the subject matter hereof and thereof and supersede all prior
agreements and undertakings, both written and oral, between the Sellers and the
Purchaser with respect to the subject matter hereof.
SECTION 11.07. Assignment. This Agreement may not be assigned
without the express written consent of the Sellers and the Purchaser (which
consent may be granted or withheld in the sole discretion of the Sellers and the
Purchaser); provided, however, that prior to the Closing the Purchaser may
assign this Agreement to an Affiliate of the Purchaser without the consent of
the Sellers.
SECTION 11.08. No Third Party Beneficiaries. This Agreement
shall be binding upon and inure solely to the benefit of the parties hereto and
their permitted assigns and nothing herein, express or implied, is intended to
or shall confer upon any other Person, including, without limitation, any union
or any employee or former employee of the Sellers or Century CP, any legal or
equitable right, benefit or remedy of any nature whatsoever, including, without
limitation, any rights of employment for any specified period, under or by
reason of this Agreement.
SECTION 11.09. Amendment. This Agreement may not be amended or
modified except (a) by an instrument in writing signed by, or on behalf of, the
parties hereto or (b) by a waiver in accordance with Section 10.03.
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SECTION 11.10. Governing Law. This Agreement shall be governed
by, and construed in accordance with, the laws of the State of New York,
applicable to contracts executed in and to be performed entirely within that
state. All actions and proceedings arising out of or relating to this Agreement
shall be heard and determined in any New York state or federal court sitting in
the City of New York.
SECTION 11.11. Counterparts. This Agreement may be executed in
one or more counterparts, and by the different parties hereto in separate
counterparts, each of which when executed shall be deemed to be an original but
all of which taken together shall constitute one and the same agreement.
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IN WITNESS WHEREOF, the Sellers and the Purchaser have caused
this Agreement to be executed as of the date first written above by their
respective officers thereunto duly authorized.
CENTURY ALUMINUM COMPANY
By /s/ Xxxxx X. Xxxxx
----------------------------
Name:
Title:
CENTURY ALUMINUM OF WEST VIRGINIA, INC.
By /s/ Xxxxxx X. Kitchen
----------------------------
Name: Xxxxxx X. Kitchen
Title: Vice President
PECHINEY ROLLED PRODUCTS LLC
By /s/ X.X. Xxxxxx
----------------------------
Name: X.X. Xxxxxx
Title: Vice President
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EXHIBITS
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A Assumption Agreement
B Xxxx of Sale
C Deed
D Management Services Agreement
E Molten Aluminum Purchase Agreement
F Ravenswood Indemnity Agreement
G Xxxxxx Indemnity Agreement
SCHEDULES
---------
1.01(a) Leased Real Property
1.01(b) Current Assets and Current Liabilities
1.01(c) Permitted Property Encumbrances
1.01(d) Senior Managers
1.01(e) Ravenswood Owned Real Property
1.01(f) Xxxxxx Owned Real Property
8.02(r) Easements
