Modine Manufacturing Company Share Purchase Agreement By and Between Modine Manufacturing Company and KB Synthetics Dated as of December 4, 2009
Exhibit
10.1
By
and Between
and
KB
Synthetics
Dated
as of December 4, 2009
This
Share Purchase Agreement (this “Agreement”) is entered into as of December 4,
2009 (the “Effective Date”), by and between:
(1) Modine
Manufacturing Company, a company organized and existing under the laws of the
State of Wisconsin (“Seller”); and
(2) KB
Synthetics Company Limited, a company organized and existing under the laws of
Korea with its office located at 0000-0 Xxxx xx-xxxx, Xxx-xx, Xxxxx, Xxxxx
(“Purchaser”).
Seller
and Purchaser shall collectively be referred to hereinafter as the “Parties” or
individually as a “Party”.
RECITALS:
WHEREAS,
the Seller owns 100% of the 840,909 issued and outstanding capital contribution
units (the “Sale Shares”) of Modine Korea LLC (the “Company”), a company
organized and existing under the laws of the Republic of Korea (“Korea”);
and
WHEREAS,
the Seller wishes to sell to the Purchaser, and the Purchaser wishes to
purchase, the Sale Shares, subject to the terms and conditions of this
Agreement.
AGREEMENT
NOW
THEREFORE, the Parties hereto agree as follows:
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1.
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Definitions
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As used
in this Agreement, the following terms shall have the following meanings, unless
the context clearly requires otherwise:
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1.1
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The
terms defined hereinabove shall have the meaning set forth
therein.
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1.2
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“Business
Day” means any day which is not a Saturday, Sunday, or bank holiday in
Korea or the United States of
America.
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1.3
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“Closing”
has the meaning set forth in Section
4.1.
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1.4
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“Closing
Date” has the meaning set forth in Section
4.1.
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1.5
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“Damages”
has the meaning set forth in Section
10.1.
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1.6
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“EPG
Products” means the engine products listed in Schedule 1.6, or products
similar to the products listed in Schedule
1.6.
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1.7
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“Government
Authority” means any national, provincial or local (including city)
government in Korea, any political subdivision thereof or any other
governmental, judicial, public, regulatory, or statutory instrumentality,
authority, body, agency, department, bureau or entity or any arbitrator
with authority to bind a Party hereto at
law.
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1.8
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“GOHAR
Type Products” means the products listed in Schedule 1.8, or products
similar to the products listed in Schedule
1.8.
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1.9
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“Government
Approval” means, with respect to any matter, (i) any and all permits,
licenses, franchises, concessions, grants, consents, approvals, orders,
registrations, authorizations, waivers, notices of no objection,
clearances from, or filings or registrations with, a Governmental
Authority, and (ii) the expiration of any and all waiting periods imposed
by applicable Law, in each case in respect of such
matter.
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1.10
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“Indemnified
Party” and “Indemnifying Party” have the meanings set forth in Section
10.1.
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1.11
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“Initial
Purchase Price” means One Billion Four Hundred Million (1,400,000,000)
Won.
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1.12
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“Intellectual
Property” means all intellectual property rights, including patents,
patent rights, trademarks, service marks, trade names, copyrights,
applications for any of the foregoing, licenses, trade secrets, and
know-how.
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1.13
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“Intercompany
Loan” means the loan issued by the Seller to the Company and governed by
the shareholder loan agreement between the Seller and the Company dated
July 28, 2004, including all amendments
thereto.
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1.14
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“Intercompany
Loan Agreement” means the shareholder loan agreement between the Seller
and the Company dated July 28, 2004, including all amendments
thereto.
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1.15
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“Knowledge”
means the actual knowledge of the persons listed in Schedule
1.15.
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1.16
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“Korea”
means the Republic of Korea.
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1.17
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“Law”
means the constitution, law, order, ordinance, regulation, public notice,
guidance or other rule with legal
effect.
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1.18
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“Lien”
means any mortgage, pledge, lien, security interest, conditional sale
agreement, title retention agreement, encumbrance or other similar
restrictions or limitations.
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1.19
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“Material
Contract” means any contract, agreement, arrangement or instrument, other
than a labor or employment contract or agreement, with a consideration of
Ten Billion (10,000,000,000) Won or more or a contract term of one (1)
year or more and to which the Company is a
party.
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1.20
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“Net
Purchase Price” means Fourteen Billion, Three Hundred Fifty Million, Eight
Hundred Sixty One Thousand, Seven Hundred Twelve (14,350,861,712)
Won.
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1.21
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“Party”
and “Parties” have the meanings set forth in the
Preamble.
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1.22
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“Purchase
Price” has the meaning set forth in Section
3.1.
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1.23
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“Required
Government Approvals” means each Government Approval required to be
obtained in connection with the execution, delivery and performance of
this Agreement.
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1.24
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“Tax”
or “Taxes” means corporate tax, income tax, value added tax, capital gain
tax, comprehensive land tax, property tax, acquisition tax, registration
tax, license tax, customs, all other taxes, national health insurance,
unemployment insurance, national pension, workers’ compensation insurance,
and all other social security dues, imposed by the Government Authority,
including any surtax, interest, fines, penalties or additions to tax that
may become payable in respect of such
taxes.
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1.25
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“Third
Party Claim” has the meaning set forth in Section
10.6(a).
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1.26
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“Transaction”
has the meaning set forth in Section
2.
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1.27
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“Won”
means the Korean won, the lawful currency of
Korea.
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2.
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Sale
and Purchase of Sale Shares
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Subject
to the terms and conditions of this Agreement, at the Closing, the Purchaser
shall purchase the Sale Shares from the Seller, and the Seller shall sell the
Sale Shares to the Purchaser (the “Transaction”).
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3.
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Payment
of Purchase Price
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3.1
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Purchase
Price. The
purchase price for the Sale Shares shall be Fifteen Billion, Seven Hundred
Fifty Million, Eight Hundred Sixty One Thousand, Seven Hundred Twelve
(15,750,861,712) Won, which shall be the sum of the Initial Purchase Price
and the Net Purchase Price (taken together, the “Purchase Price”). The
Purchaser shall pay the Initial Purchase Price to the Seller before the
close of business on the Effective Date, to an account to be designated by
the Seller. Except pursuant to Section 3.2 hereof, the Purchase
Price shall not be adjusted for any
reason.
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3.2
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PP&E and Inventory
Adjustment. Following a mutually agreeable verification
process to be completed by the Purchaser no later than January 15, 2010
solely for the purpose of confirming that any of the Company’s plant,
property, equipment and inventory assets as listed in the Company’s
records as of November 30, 2009 are missing or do not exist, the Purchase
Price shall be reduced by an amount commensurate with the aggregate book
value of such missing or non-existent assets in excess of One Hundred
Million (100,000,000) Won. For the avoidance
of doubt, the above adjustment will be triggered only in the event the
aforementioned listed assets are proven by the mutually agreeable process
to be missing or non-existent and Purchaser provides written evidence to
that effect to Seller. Notwithstanding any provision in this
Section, the Purchase Price shall not be reduced if the aggregate amount
of the book value of the missing or non-existent assets is less than One
Hundred Million (100,000,000) Won. Further, the maximum amount
of reduction in the Purchase Price pursuant to this Section shall not in
any event exceed One Billion (1,000,000,000)
Won.
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3.3
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Forfeiture of Initial
Purchase Price. In the event the Parties fail to close
the Transaction for any reason, other than a reason attributable solely to
the Seller, the Purchaser shall forfeit any rights to the Initial Purchase
Price, which shall remain the property of the Seller. For the
avoidance of doubt, any matter related to the human resources of the
Company shall NOT be deemed a reason attributable to the
Seller.
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4.
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Closing
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4.1
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Time and
Place. The purchase and sale of the Sale Shares
contemplated by this Agreement shall be consummated at a closing (the
“Closing”) to be held at 10:00 A.M. on December 23, 2009 or such other
date and time as mutually agreed between the Parties (the “Closing
Date”). The Closing shall take place at the offices of Xxx
& Xxxxx located at Northgate Building, 66 Juksun-Dong, Chongro-gu,
Seoul, at 10:00 a.m. on the Closing
Date.
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4.2
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Actions at
Closing. At the Closing, the Parties hereto shall
perform the following actions:
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(a)
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The
Purchaser shall pay the Net Purchase Price to the Seller without any
withholding, deduction or adjustment of any nature, by means of wire
transfer of immediately available funds in Won into a bank account
designated in writing by the Seller;
and
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(b)
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The
Seller shall deliver to the Purchaser copies of (i) the unitholders
meeting resolution (or written consent), (ii) the articles of
incorporation of the Company, and (iii) the unitholder registry of the
Company, all of which show the Purchaser as the sole unitholder of the
Company holding the Sale Shares;
and
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(c)
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In
the event the entire balance of the Intercompany Loan has not yet been
repaid in full by the Company at or prior to Closing pursuant to Section
7.8, (i) the Purchaser shall deliver to the Seller the payment guarantee
issued by the Purchaser in a form and substance acceptable to the Seller
in its sole discretion that any then outstanding principal and interest
under the Intercompany Loan shall be paid in full no later than March 31,
2010, and (ii) the Seller shall deliver to the Purchaser an amendment to
the Intercompany Loan Agreement which shall provide for repayment of the
Intercompany Loan in accordance with the terms and conditions described
hereunder.
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5.
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Representations
and Warranties of the Seller
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The
Seller hereby represents and warrants to the Purchaser, as of the Effective Date
and as of the Closing (unless otherwise specified), as follows:
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5.1
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Representations and
Warranties with Respect to the Seller and the Sale
Shares.
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(a)
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Share
Ownership. The Seller is the legal and beneficial owner of the Sale
Shares. Upon consummation of the Closing contemplated herein,
the Purchaser will acquire from the Seller title to the Sale Shares, free
and clear of all Liens.
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(b)
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Authorization of
Agreement; Enforceability.
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(i)
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The
Seller has all requisite corporate power and authority to execute, deliver
and perform its obligations under this Agreement. The
execution, delivery and performance of this Agreement has been duly
authorized by all necessary corporate action on the part of the
Seller.
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(ii)
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This
Agreement has been duly executed and delivered by the Seller and
constitutes its valid and binding obligation, enforceable against it in
accordance with its terms, except as such enforceability may be limited by
bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium
or other similar Laws relating to or affecting creditors' rights
generally.
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(c)
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Government Approval;
No Conflicts with Law, Articles of Incorporation and Government
Approval.
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(i)
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Except
for the Required Government Approvals set forth in Schedule
5.1(c), no Government Approval is required to have been made or
obtained by the Seller under the relevant Law in connection with the
execution, delivery and performance of this
Agreement.
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(ii)
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The
execution, delivery and performance by the Seller of this Agreement will
not: (x) violate any provision of the Seller’s Articles of Incorporation
or other constitutional documents or (y) violate any Law or Government
Approval applicable to the Seller.
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5.2
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Representations and
Warranties with Respect to the
Company.
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(a)
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Organization of the
Company. The Company is duly organized and validly
existing under the laws of Korea.
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(b)
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Capitalization. As
of the date of this Agreement, each unit of capital contribution of the
Company has a par value of 5,000 Won per unit, and 840,909 units of
capital contribution are issued and outstanding. All of the
Sale Shares have been duly authorized and validly issued and are fully
paid and non-assessable. There are no outstanding options, warrants,
subscription rights, calls or commitments, whether contingent or absolute,
of any nature whatsoever relating to, or securities or rights convertible
into, any class of unit of capital contribution of the Company, or
contracts by which the Company is bound to issue additional units of
capital contribution.
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(c)
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Material
Contracts. To the Seller’s Knowledge, as of the date of
this Agreement, each Material Contract is in
full force and effect, and there exists no default or event of default or
event, occurrence, condition, or act which, with the giving of notice, the
lapse of time, would become a default or event of default
thereunder. The Company has not violated any of the terms or
conditions of any Material Contract in any material
respect. There is no Material Contract: (i) requiring the
Company to obtain prior written consent to consummate the Transaction; or
(ii) setting forth that a change of control of the Company constitutes an
event of termination thereof. The execution, delivery
and performance by Seller of this Agreement and the consummation by Seller
of the Transaction will not constitute (with due notice or lapse of time
or both) a default under any Material Contract to which Seller is a party
or by which Seller is bound.
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6.
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Representations
and Warranties of the Purchaser
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The
Purchaser represents and warrants to the Seller, as of the Effective Date and as
of the Closing Date, as follows:
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6.1
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Organization of the
Purchaser. The Purchaser is duly organized and validly
existing under the laws of Korea.
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6.2
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Authorization of Agreement;
Enforceability.
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(a)
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The
Purchaser has all requisite corporate power and authority necessary to
execute, deliver and perform its obligations under this
Agreement. The execution, delivery and performance of this
Agreement has been duly authorized by all necessary corporate action on
the part of the Purchaser.
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(b)
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This
Agreement has been duly executed and delivered by the Purchaser and
constitutes its valid and binding obligation, enforceable against it in
accordance with its terms, except as such enforceability may be limited by
bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium
or other similar Laws relating to or affecting creditors’ rights
generally.
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6.3
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Government Approval;
No Conflicts with Law, Articles of Incorporation and Government
Approval.
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(a)
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Except
for the Required Government Approvals with respect to the purchase of the
Sale Shares set forth in Schedule
6.3(a), no Government Approval is required to have been made or
obtained by the Purchaser under the relevant Law in connection with the
execution, delivery and performance of this
Agreement.
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(b)
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The
execution, delivery and performance of this Agreement by the Purchaser
will not (i) violate any provision of the Purchaser’s articles of
incorporation or other constitutional documents or (ii) violate any Law or
Government Approval applicable to the
Purchaser.
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6.4
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Financial
Capacity. The Purchaser has and will have the
financial capacity and means to pay the Purchase Price and to comply with
any other obligations under this Agreement and will pay the Purchase Price
and comply with such obligations in accordance with this
Agreement.
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7.
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Covenants
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The
Seller and the Purchaser, as applicable, each covenant with the other as
follows:
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7.1
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Further
Assurances. Upon the terms and subject to the conditions
contained herein, each of the Parties hereto shall in good faith, both
before and after the Closing: (i) use all reasonable efforts to take, or
cause to be taken, diligently all actions and do, or cause to be done, all
things necessary, proper or advisable to consummate and make effective the
Transaction, (ii) execute any documents and instruments which may be
reasonably necessary or advisable to carry out the Transaction, and (iii)
cooperate with each other in connection with the foregoing. The
Seller and the Purchaser shall cooperate with the other and shall use its
best efforts before and after the Closing to (a) obtain the permits
required to be obtained by it under any applicable Law in connection with
the Transaction; (b) effect all necessary recordings, registrations and
filings, including submissions of information requested by any Government
Authority, and (c) fulfill all conditions to this Agreement applicable to
such Party. The Seller and the Purchaser will provide prompt
notification to each other when any consent or permit contemplated
hereunder is obtained and when any action, filing or notification is
taken, made or given, as applicable, in connection
therewith.
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7.2
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Notification of
Certain Matters. Prior to the Closing Date, each Party
hereto shall promptly give notice to the other Party of (a) the occurrence
of any event which occurrence has caused or is reasonably likely to cause,
any representation or warranty of such Party contained in this Agreement
to be untrue or inaccurate, and (b) any failure of such Party to comply
with or satisfy any material covenant, condition or agreement to be
complied with or satisfied by it under this
Agreement.
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7.3
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Conduct of
Business. From the Effective Date until the Closing, the
Seller shall cause the Company:
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(a)
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to
conduct its operations according to its ordinary and usual course of
business and consistent with past
practice;
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(b)
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not
to carry out or effect any capital expenditure in each single case
exceeding an amount of 125,000,000 Won without the prior written consent
of the Purchaser;
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(c)
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not
to conclude contracts on the sale of or grant of any Lien over any asset
that has a book value exceeding 125,000,000 Won, other than sales or
transfers of inventory or accounts receivable in the ordinary course of
business consistent with past practice, except for the incurrence of such
loan(s) (including provision of collateral therefor) whose proceeds are
used by the Company for the repayment of the Intercompany Loan pursuant to
Section 7.8 hereof;
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(d)
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not
to issue, sell, grant or otherwise dispose of any units of capital
contribution of the Company, any options related to any units of capital
contribution with respect to the Company or modify or amend any right of
any holder of outstanding units of capital contribution of the
Company;
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(e)
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not
to assign, transfer or terminate any Material Contracts outside the
ordinary course of business without the prior written consent of the
Purchaser;
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(f)
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not
to conclude any contract which involves an annual expense exceeding an
amount of 125,000,000 Won and which has a remaining term of more than 12
months;
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(g)
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not
to conclude any contract which involves an annual expense exceeding an
amount of 125,000,000 Won and which provides for legal consequences in the
event of a change of control;
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(h)
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not
to abandon or allow to lapse any patents, trademarks or other Intellectual
Property of the Company;
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(i)
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not
to amend its articles of incorporation or take any action with respect to
any such amendment or any recapitalization, reorganization, liquidation or
dissolution of the Company; and
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(j)
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not
to declare, set aside, make or pay any dividend or other distribution,
payable in cash or property, with respect to any units of capital
contribution or other ownership interest in the
Company.
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7.4
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Non-Competition.
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(a)
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The
Seller covenants and agrees that neither it nor any of its affiliates
shall directly or indirectly:
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(i)
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for
a period of one (1) year from the Closing Date, solicit for hire any
officer or employee of the Company, except that this provision shall not
apply to the employees listed in Schedule 7.4
and “solicit for hire” shall not include referrals made by a placement
agency or responses to any advertising appearing on the Internet or in a
newspaper, magazine or trade publication placed in the ordinary course of
business; or
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(ii)
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for
a period of four (4) years from the Closing Date, own, manage, engage in
or operate a business that designs, manufactures, markets, packages and
distributes heating and air conditioning products in Korea for buses,
trains and military vehicles and/or located in the passenger compartment
of automobiles, trucks and off-highway
vehicles.
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(b)
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The
Purchaser covenants and agrees that neither it nor any of its affiliates
(including the Company) shall directly or
indirectly:
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(i)
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for
a period of one (1) year from the Closing Date, solicit for hire any
officer or employee of the Seller; provided, however, that “solicit for
hire” shall not include referrals made by a placement agency or responses
to any advertising appearing on the Internet or in a newspaper, magazine
or trade publication placed in the ordinary course of business;
or
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(ii)
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for
a period of four (4) years from the Closing Date, except as otherwise
agreed by the Parties, manage, engage in or operate a business that xxxxx
XXXXX Type Products anywhere in the world;
or
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(iii)
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for
a period of four (4) years from the Closing Date, except as otherwise
agreed by the Parties, manage, engage in or operate a business that sells
any EPG Product(s) anywhere in the
world.
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7.5
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Public
Statements. The Parties hereto will agree upon the
timing and content of any press release to be issued or any public
disclosure to be made relating to the execution, content, and termination
of this Agreement, and each Party hereto shall not issue any press release
or make any public disclosure without the consent of the other Parties;
provided
that nothing in this Section 7.5 shall prevent any Party from issuing any
press release or making any public disclosure that is required or
advisable under any applicable Law. If either the Seller or the
Purchaser determines that it is required by applicable Law to make any
such disclosure, it shall send notice to such effect, accompanied by the
text of the proposed disclosure, to the other Party as far in advance as
practicable, and shall use good faith efforts to reflect any reasonable
comments made by the other Party relating to the proposed
disclosure.
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7.6
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Confidentiality.
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(a)
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Purchaser
acknowledges that it has entered into the Confidentiality Agreement dated
February 12, 2009 (the “Confidentiality Agreement”) and confirms that all
relevant confidential documents and information concerning the Company
shall be subject to the obligations set forth therein prior to
Closing.
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(b)
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This
section shall not prohibit disclosure or use of any information if and to
the extent:
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(i)
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the
disclosure or use is required by applicable Law, any regulatory body or
any recognized stock exchange or may be advisable thereunder, provided
that such disclosure or use is subject to Section
7.6;
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(ii)
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the
disclosure is made to a Governmental Authority in connection with the Tax
affairs of the disclosing party;
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(iii)
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the
information is or becomes publicly available (other than by breach of the
Confidentiality Agreement or of this Agreement); provided, however, that
prior to disclosure or use of any information pursuant to (i) or (ii), the
Party concerned shall promptly notify and consult with the other Party of
such requirement with a view to providing such other Party with the
opportunity to (x) contest such disclosure or use or (y) otherwise to
consult and agree on the timing and content of such disclosure or
use.
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7.7
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Corporate Name.
The
Purchaser shall cause the Company to (a) immediately register a new
corporate name and discontinue use of the name “Modine” in any external
correspondence (including letters, emails, etc.), (b) within fifteen
Business Days of the Closing, (i) remove the name “Modine” from all other
business documents, (ii) remove all decals and logos containing the name
“Modine” from all Company owned or leased vehicles and entry ways, (iii)
provide suppliers of product packaging materials with the new company name
to be used on all subsequently ordered packaging materials, (iv) remove
the name “Modine” from all racks used for shipping products, (v)
discontinue use of all decals and logos containing the name “Modine” on
bus air conditioning units, and (vi) remove any logos containing the name
“Modine” from all embossings on plastic or metal product components, and
(c) no later than January 31, 2010, remove the name “Modine” and all logos
containing the name “Modine” from all buildings leased or owned by the
Company, including the plant, warehouse, guard house, apartments and
dormitories.
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7.8
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Intercompany
Loan Repayment. Prior to the Closing Date, the Seller shall
exert its commercially reasonable efforts to cause the Company to repay
the balance of the Intercompany Loan and all accrued interest in full,
notwithstanding Section 7.3 hereof. However, in the event the
entire balance of the Intercompany Loan has not yet been repaid in full by
the Company at or prior to Closing for any reason, the
Purchaser shall ensure that the Company pays any remaining balance of the
Intercompany Loan no later than March 31,
2010.
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8.
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Conditions
Precedent to the Closing
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8.1
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Conditions to the Purchaser’s
Obligations. The Purchaser will have no obligation to consummate
the Transaction at the Closing unless each of the following conditions
precedent is satisfied or waived in writing by the
Purchaser:
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(a)
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Representations and
Warranties; Covenants. The representations and
warranties set forth in Sections 5.1 and 5.2 hereof shall be true and
correct in all material respects. The Seller shall have
performed in all material respects all obligations required under this
Agreement to be performed by it prior to the
Closing.
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(b)
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Compliance with Laws;
No Adverse Action or Decision. Since the Effective Date,
(i) no Law shall have been promulgated or enacted that materially delays
or makes illegal the performance of this Agreement; (ii) no order by any
Government Authority that materially delays or makes illegal the
performance of this Agreement shall be effective; and (iii) no Government
Authority shall have instituted any Proceeding that seeks to materially
delay or make illegal the performance of this
Agreement.
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Execution
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(c)
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Consents. All
Required Government Approvals required to be obtained by the Seller prior
to the Closing shall have been obtained and shall not be subject to any
material conditions.
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(d)
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Resignation of
Directors. All
members of the Board of Directors of the Company have provided a letter of
resignation as director effective upon the
Closing.
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8.2
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Conditions to the Seller’s
Obligations. The Seller will not have any obligation to
consummate the Transaction at the Closing unless each of the following
conditions precedent is satisfied or waived in writing by the
Seller:
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(a)
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Representations and
Warranties; Covenants. The representations and
warranties of the Purchaser set forth in Section 6 hereof shall be true
and correct in all material respects. The Purchaser shall have
performed in all material respects all obligations required under this
Agreement to be performed by it prior to the
Closing.
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(b)
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Compliance with Laws;
No Adverse Action or Decision. Since the Effective Date,
(i) no Law shall have been promulgated or enacted that materially delays
or makes illegal the performance of this Agreement; (ii) no order by any
Government Authority that materially delays or makes illegal the
performance of this Agreement shall be effective; and (iii) no Government
Authority shall have instituted any Proceeding that seeks to materially
delay or make illegal the performance of this
Agreement.
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(c)
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Consents. All
Required Government Approvals required to be obtained by the Purchaser
prior to the Closing shall have been obtained and shall not be subject to
any conditions that would have a Material Adverse
Effect.
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9.
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Termination
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9.1
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Termination of
Agreement. Subject to Section 9.2, this Agreement may be
terminated by notice to the other Party in writing prior to the Closing by
the Purchaser or the Seller for each of the following cases; provided, however, that
the right to terminate this Agreement shall not be available to any Party
who is responsible for any of the following cases, and this Agreement
shall not be terminated for any reason after the
Closing:
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Execution
Version – Share Purchase Agreement
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(a)
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the
Closing has not occurred by January 15,
2010;
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(b)
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the
other Party is in material breach of any representation, warranty,
covenant or agreement contained in this Agreement and such breach is (i)
of such a serious nature that, if not remedied, would have a severe
financial impact on the other Party upon Closing and (ii) has not been
cured within fifteen (15) days following receipt of notice of such breach
from the other Party; or
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(c)
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there
is a mutual agreement of the
Parties.
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9.2
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Effect of
Termination. If this Agreement is terminated in
accordance with Section 9.1, this Agreement shall become null and void and
of no further force and effect, except that the terms and provisions of
Sections 3.3, 7.6, 9.2, 9.3, 10, and 11 shall remain in full force and
effect.
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9.3
|
Remedies. All
rights and remedies existing under this Agreement are exclusive of any
rights or remedies otherwise available under any applicable
Law.
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10.
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Indemnification
and Survival Period
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10.1
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Indemnification. Each
Party hereto (the “Indemnifying Party”) shall indemnify the other Party
(the “Indemnified Party”) against, and hold the other Party, its
successors and assigns harmless from, any and all damages, taxes, claims,
losses, payments, charges, judgments, amounts paid in settlement,
liabilities or expenses, including without limitation, interest, fines,
penalties and reasonable attorneys’ fees, expenses and disbursements
(collectively, “Damages”), arising out of the breach of any warranty or
representation of the Indemnifying Party contained in this
Agreement. For the purpose of this Section 10.1, a termination
of this Agreement pursuant to Section 9.1(a) shall not constitute a breach
of any warranty or representation by any Party hereto under this Agreement
and the Transaction, and no Party hereto shall be responsible for such
termination.
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10.2
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Damage
Threshold. Neither the Seller nor the Purchaser, in its
capacity as an Indemnifying Party, shall have any obligation to indemnify
the other Party from and against any Damages pursuant to Section 10.1
above until the other Party has suffered Damages in excess of an aggregate
threshold of three percent (3%) of the total Purchase Price (with
individual claims less than One Hundred Million (100,000,000) Won not to
be included in the preceding aggregate threshold), at which point the
Indemnifying Party will be obligated to indemnify the other Party from and
against all such Damages in excess of such threshold
amount. The Parties hereto also agree that the maximum
aggregate amount, which the Purchaser may recover from the Seller in
respect of all claims, is ten percent (10%) of the total Purchase
Price.
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Execution
Version – Share Purchase Agreement
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10.3
|
Survival of the
Representations and Warranties. The representations and
warranties of the Parties hereto shall survive for a period of eighteen
(18) months after the Closing Date, except that the representation and
warranty under Section 5.1(a) shall survive
indefinitely.
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10.4
|
Notice; Claim
Period. Any Indemnified Party making a claim for indemnification
hereunder shall notify the Indemnifying Party or Parties of the claim in
writing. To the extent possible, the notice shall specify and
describe in detail the legal and factual basis of the claim, identify the
supporting evidence, and contain an estimate of the Damages. If
a Party fails to deliver such notice within eighteen (18) months from the
Closing Date, the Party shall not be entitled to make the relevant claim
under this Agreement, provided that such limit shall not apply to the
breach of the representation and warranty under Section
5.1(a).
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10.5
|
Exceptions; No
Duplication; Sole Remedy.
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|
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(a)
|
The
Indemnified Party shall take all reasonable steps to mitigate losses upon
and after becoming aware of an event which, in the Indemnified Party’s
good faith judgment, is reasonably likely to give rise to such
Damages.
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|
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(b)
|
Any
liability for indemnification hereunder shall be determined without
duplication of recovery by reason of the state of facts giving rise to
such liability constituting a breach of more than one representation,
warranty, covenant or agreement.
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(c)
|
The
Indemnified Party’s rights to indemnification as provided for in Section
10.1 shall constitute the Indemnified Party’s sole and exclusive remedy
with respect to the breach of any warranty or representation of the
Indemnifying Party contained in this
Agreement.
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|
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(d)
|
To
the extent any Indemnified Party receives any insurance proceeds with
respect to any Damages to be indemnified under this Agreement, such
insurance proceeds shall be deducted from the relevant Damage amount
payable.
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|
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(e)
|
In
no event shall either Party be liable to the other Party hereunder for any
consequential, incidental or special damages, absent intentional
misconduct by the Indemnifying
Party.
|
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10.6
|
Matters Involving
Third Parties.
|
|
|
(a)
|
If
any third party shall notify the Indemnified Party in writing with respect
to any matter (a “Third Party Claim”), which may give rise to a claim for
indemnification against the Indemnifying Party under this Agreement, then
the Indemnified Party shall notify the Indemnifying Party thereof in
writing within thirty (30) Business Days of receipt of notice of such
claim.
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Execution
Version – Share Purchase Agreement
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(b)
|
The
Indemnifying Party shall have the right to defend the Indemnified Party
against the Third Party Claim with counsel of the Indemnifying Party’s
choice, at the Indemnifying Party’s sole expense. The Indemnifying Party
may at its discretion consent to the entry of any judgment or enter into
any settlement with respect to any Third Party Claim, provided that in the
case of any settlement that provides for any relief other than the payment
of monetary damages, such consent or settlement will be subject to the
consent of the Indemnified Party, which consent will not be unreasonably
withheld or delayed. The Indemnifying Party will have full
control of such defense and
proceedings.
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|
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(c)
|
Whether
or not the Indemnifying Party elects to defend any Third Party Claim, the
parties shall cooperate and exercise all reasonable efforts in the defense
or prosecution of any such claim and shall furnish one another with such
records, information and testimony, and attend such conferences,
proceedings, hearings, trials and appeals as may be reasonably by the
other in connection therewith.
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11.
|
Miscellaneous
|
|
11.1
|
Fees and
Expenses. Except as otherwise expressly provided in this
Agreement, each Party hereto shall pay all costs and expenses including,
but not limited to, attorneys, accountants, consultants, agents and
brokers’ fees, incurred or to be incurred by it in connection with this
Agreement and the Transaction, regardless of whether the Closing has
occurred. However, to the extent the Company has accrued for
the payment of any such expenses incurred prior to October 31, 2009, those
expenses shall remain the obligation of the Company. For the
avoidance of any doubt, any success fee payable to the advisors of the
Seller and related to the consummation of the Transaction shall remain the
sole responsibility of the Seller.
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|
11.2
|
Notices. All
notices, demands, requests, consents or other communications
hereunder shall be in writing and shall be given by personal delivery, by
express courier, by registered or certified mail with return receipt
requested, or by facsimile, to the Parties at the addresses shown below,
or to such other address as may be designated by written notice given by
either Party to the other Party. Unless conclusively proven
otherwise, all notices, demands, requests, consents or other
communications hereunder shall be deemed effective upon delivery if
personally delivered five (5) days after dispatch if sent by express
courier, fourteen (14) days after dispatch if sent by registered or
certified mail with return receipt requested, or confirmation of the
receipt of the facsimile by the recipient if sent by
facsimile.
|
- 15
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Execution
Version – Share Purchase Agreement
To Purchaser:
KB
Synthetics Co., Ltd.
Xxxxx
Xxxxxxxx, 0-0, Xxxxxx-xxxx
Xxxxxxx-xx,
Xxxxx, Xxxxx
Attention:
H. S. Park
Facsimile:
000-000-0000
To Seller:
0000
XxXxxxx Xxxxxx
Xxxxxx,
Xxxxxxxxx, XXX 00000
Attention:
Xxxxxxxx X. Xxxxxx, Esq.
Facsimile:
000-000-0000
|
11.3
|
Governing
Law. This Agreement and all disputes arising out of or
in connection with this Agreement shall be governed by, interpreted under,
and construed and enforceable in accordance with, the laws of
Korea.
|
|
11.4
|
Arbitration. Any
dispute arising from the performance or interpretation of this Agreement
shall finally be settled in accordance with the Rules of Arbitration of
the International Chamber of Commerce by three (3) arbitrators appointed
in accordance with such rules. The place of arbitration shall be Singapore
and the language of arbitration shall be
English.
|
|
11.5
|
Entire
Agreement. This Agreement (including, Exhibits, Annexes,
and Schedules hereto) and the agreements, documents and instruments to be
executed and delivered pursuant hereto or thereto or referred to herein
are intended to embody the final, complete and exclusive agreement among
the Parties hereto with respect to the purchase of the Sale Shares and
related transactions and supersede all prior agreements, understandings
and representations written or oral, with respect
thereto.
|
|
11.6
|
Severability. If
any provision hereof is found invalid, illegal or unenforceable
pursuant to any executive, legislative, judicial or other decree or
decision, the remainder of this Agreement shall remain valid, legal and
enforceable according to its terms, and such invalid, illegal or
unenforceable provision shall be replaced with a provision that
approximates the substance and spirit of the invalid, illegal or
unenforceable provision as closely as possible without being invalid,
illegal or unenforceable.
|
|
11.7
|
Amendment. This
Agreement shall not be modified, amended, canceled or altered in any way,
and may not be modified by custom, usage of trade or course of dealing,
except by an instrument in writing signed by all Parties
hereto. All amendments or modifications of this Agreement shall
be binding upon the Parties despite any lack of consideration so long as
the same shall be in writing and executed by the
Parties.
|
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Execution
Version – Share Purchase Agreement
|
11.8
|
Waiver. The
performance of any obligation required of a Party hereunder may be waived
only by a written waiver signed by the other Party, and such waiver shall
be effective only with respect to the specific obligation
described. The waiver by either Party of a breach of any
provision of this Agreement by the other Party shall not operate or be
construed as a waiver of any subsequent breach of the same provision or
another provision of this
Agreement.
|
|
11.9
|
Assignment. Neither
this Agreement nor any rights or obligations hereunder shall be assignable
or transferable by any Party to this Agreement without the prior written
consent of the other Parties to this
Agreement.
|
|
11.10
|
Third Party
Benefits. This Agreement shall be binding upon, and
inure to the benefit of, each of the Parties hereunder and their
respective successors. Nothing contained in this Agreement,
express or implied, shall be deemed to confer any right or remedy upon, or
obligate any Party to, any person or entity other than the Parties and
their respective successors and permitted
assigns.
|
|
11.11
|
Counterparts. This
Agreement may be executed simultaneously in any number of counterparts,
each of which shall be deemed and original but all of which together shall
constitute one and the same
instrument.
|
|
11.12
|
Captions. The
section headings and captions contained herein are for purposes of
reference and convenience only and shall not in any way affect the meaning
or interpretation of this
Agreement.
|
|
11.13
|
Language. This
Agreement shall be executed in English. If there is any
discrepancy in the content or interpretation of any translation of this
Agreement in any language other than the English language, the English
version shall prevail.
|
[signature page to
follow]
- 17
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Execution
Version – Share Purchase Agreement
IN
WITNESS WHEREOF, the Parties hereto have duly executed this Agreement as of the
day and year first above written.
|
KB
Synthetics Company Limited
|
||||
|
By:
|
/s/
Xxxxxx X. Marry
|
By:
|
/s/
(Xxxxx) Hyo Sang Park
|
|
|
Name:
|
Xxxxxx
X. Marry
|
Name:
|
Park,
Hyo Sang
|
|
|
Title:
|
Regional
VP – Asia and CPG
|
Title:
|
President
|
|
|
By:
|
/s/
Xxxxxxx X. Xxxxxxxx
|
|||
|
Name:
|
Xxxxxxx
X. Xxxxxxxx
|
|||
|
Title:
|
Director
– Modine Korea Transition
|
|||
