1
EXHIBIT 2.1
[EXECUTION COPY]
================================================================================
SECURITIES PURCHASE AGREEMENT
AMONG
REPUBLIC GROUP LLC,
CENTEX CONSTRUCTION PRODUCTS, INC.
AND
REPUBLIC HOLDING CORPORATION
Dated as of November 10, 2000
================================================================================
2
TABLE OF CONTENTS
Page
----
ARTICLE I PREACQUISITION TRANSACTIONS...................................................................................2
SECTION 1.1. Reorganization of Republic Group Companies..................................................2
SECTION 1.2. Contribution and Sale of Certain Assets.....................................................3
SECTION 1.3. Further Assurances..........................................................................3
ARTICLE II PURCHASE AND SALE OF SECURITIES...............................................................................3
SECTION 2.1. Purchase and Sale of Securities.............................................................3
SECTION 2.2. Assignment and Admission....................................................................4
SECTION 2.3. Purchase Price..............................................................................4
SECTION 2.4. Security for Certain Obligations............................................................4
SECTION 2.5. Further Assurances..........................................................................4
ARTICLE III THE CLOSING...................................................................................................5
SECTION 3.1. Closing.....................................................................................5
SECTION 3.2. Deliveries; Certain Actions.................................................................5
ARTICLE IV REPRESENTATIONS AND WARRANTIES OF THE SELLER..................................................................7
SECTION 4.1. Organization and Qualification..............................................................7
SECTION 4.2. Authority and Enforceability................................................................7
SECTION 4.3. Absence of Conflicts........................................................................7
SECTION 4.4. Governmental Consents and Filings...........................................................8
SECTION 4.5. Ownership and Transfer of Securities........................................................8
SECTION 4.6. Capitalization..............................................................................9
SECTION 4.7. Subsidiaries................................................................................9
SECTION 4.8. Financial Statements.......................................................................10
SECTION 4.9. Absence of Undisclosed Liabilities.........................................................11
SECTION 4.10. Absence of Certain Changes or Events.......................................................11
SECTION 4.11. Litigation.................................................................................11
SECTION 4.12. Compliance with Laws and Other Requirements................................................12
SECTION 4.13. Premier/Republic Merger....................................................................12
SECTION 4.14. Senior Subordinated Note Indenture.........................................................12
SECTION 4.15. Properties and Assets......................................................................13
SECTION 4.16. Environmental Matters......................................................................14
SECTION 4.17. Taxes......................................................................................14
SECTION 4.18. Employee Benefit Plans.....................................................................15
SECTION 4.19. Labor Matters..............................................................................17
i
3
SECTION 4.20. Intellectual Property Rights...............................................................18
SECTION 4.21. Insurance..................................................................................18
SECTION 4.22. Brokers' or Finders' Fees..................................................................18
ARTICLE V REPRESENTATIONS AND WARRANTIES OF THE PURCHASERS.............................................................19
SECTION 5.1. Organization...............................................................................19
SECTION 5.2. Authority and Enforceability...............................................................19
SECTION 5.3. Absence of Conflicts.......................................................................19
SECTION 5.4. Governmental Consents and Filings..........................................................20
SECTION 5.5. Securities Act; Investment Representation..................................................20
SECTION 5.6. Financing..................................................................................20
SECTION 5.7. Brokers' or Finders' Fees..................................................................20
SECTION 5.8. Litigation.................................................................................20
ARTICLE VI CERTAIN COVENANTS AND AGREEMENTS.............................................................................20
SECTION 6.1. Commercially Reasonable Efforts............................................................20
SECTION 6.2. Change of Name. From and after.............................................................21
SECTION 6.3. Financial Statements, Books and Records....................................................21
SECTION 6.4. Employees and Plans........................................................................22
SECTION 6.5. Use of Proceeds; Bank Credit Facility......................................................24
SECTION 6.6. Certain Tax Proceedings....................................................................24
ARTICLE VII CONDITIONS TO CLOSING........................................................................................24
SECTION 7.1. Conditions to the Obligations of Each of the Parties.......................................24
SECTION 7.2. Conditions to the Obligations of the Purchasers............................................25
SECTION 7.3. Conditions to the Obligations of the Seller................................................25
ARTICLE VIII INDEMNIFICATION..............................................................................................26
SECTION 8.1. Indemnification by the Seller..............................................................26
SECTION 8.2. Indemnification by the Purchasers..........................................................27
SECTION 8.3. Third-Party Claims; Procedures.............................................................28
SECTION 8.4. Survival of Representations, Warranties or Covenants.......................................29
SECTION 8.5. Exclusive Remedy...........................................................................29
SECTION 8.6. Disclaimer of Other Warranties.............................................................29
SECTION 8.7. Express Negligence Rule....................................................................30
SECTION 8.8. Damages....................................................................................30
ii
4
ARTICLE IX TERMINATION..................................................................................................31
SECTION 9.1. Termination................................................................................31
SECTION 9.2. Effect of Termination......................................................................31
ARTICLE X DEFINITIONS..................................................................................................31
SECTION 10.1. Definitions................................................................................31
ARTICLE XI MISCELLANEOUS................................................................................................38
SECTION 11.1. Fees and Expenses..........................................................................38
SECTION 11.2. Notices....................................................................................38
SECTION 11.3. Amendment; Waivers.........................................................................39
SECTION 11.4. Entire Agreement...........................................................................39
SECTION 11.5. Parties in Interest; Assignment............................................................40
SECTION 11.6. Governing Law..............................................................................40
SECTION 11.7. Severability...............................................................................40
SECTION 11.8. Specific Performance.......................................................................40
SECTION 11.9. Public Announcements.......................................................................40
SECTION 11.10. Headings...................................................................................41
SECTION 11.11. Counterparts...............................................................................41
EXHIBITS
Exhibit A Form of Assignments
Exhibit B Form of Accession Agreements
Exhibit C Form of Trademark Assignment
Exhibit D Form of Assumption Agreement
Exhibit E Form of Transition Services Agreement
Exhibit F Form of Management Agreement
Exhibit G Form of Guaranties
Exhibit H Form of Security Documents
Exhibit I Form of Supplemental Indenture
Exhibit J Opinion of Xxxxxxx & Xxxxx L.L.P.
Exhibit K Opinion of Xxxxx Xxxxx L.L.P.
SCHEDULES
Schedule 4.1 Certain Jurisdictions
Schedule 4.3 Certain Conflicts and Consents
Schedule 4.6 Capitalization
Schedule 4.7 Subsidiaries and Investments
Schedule 4.8 Balance Sheet
Schedule 4.9 Certain Liabilities
Schedule 4.10 Certain Changes
iii
5
Schedule 4.11 Litigation
Schedule 4.12 Compliance with Laws
Schedule 4.13 Certain Waivers
Schedule 4.15 Properties and Assets
Schedule 4.16 Environmental Matters
Schedule 4.17 Taxes
Schedule 4.18 Employee Benefit Plans
Schedule 4.19 Labor Matters
Schedule 4.20 Intellectual Property Rights
Schedule 4.21 Insurance
iv
6
SECURITIES PURCHASE AGREEMENT
This SECURITIES PURCHASE AGREEMENT, entered into as of November 10,
2000, by and among REPUBLIC GROUP LLC, a Delaware limited liability company
(formerly Republic Group Incorporated, a Delaware corporation, prior to the
conversion of such corporation into a Delaware limited liability company on
November 9, 2000) (the "Seller"), CENTEX CONSTRUCTION PRODUCTS, INC. a Delaware
corporation ("CXP"), and REPUBLIC HOLDING CORPORATION, a Nevada corporation
("Acquisition Sub" and, together with CXP, the "Purchasers").
WITNESSETH:
WHEREAS, the Seller is engaged, directly and indirectly through the
Target Companies (as hereinafter defined), the Target Subsidiaries (as
hereinafter defined) and the other Republic Group Companies (as hereinafter
defined), in the business of manufacturing and distributing recycled paperboard
and gypsum wallboard and conducting certain related activities;
WHEREAS, on November 9, 2000, Premier Construction Acquisition
Partners, L.P., a Delaware limited partnership ("Premier Partners"), acquired
all of the outstanding equity securities of the Seller as a result of (i) the
merger (the "Premier/Republic Merger") of a subsidiary of Premier Construction
Products, Inc., a Delaware corporation (formerly Premier Construction Products
Statutory Trust, a statutory trust organized under the laws of the State of
Connecticut) ("Premier"), with and into Republic Group Incorporated, a Delaware
corporation and the predecessor of the Seller, in accordance with the terms of
an Agreement and Plan of Merger, dated as of August 11, 2000 (the
"Premier/Republic Merger Agreement"), among Premier, a subsidiary of Premier and
Republic Group Incorporated and (ii) the contribution by Premier of the
outstanding equity securities of the Seller to Premier Partners;
WHEREAS, the Seller and the Republic Group Companies (as hereinafter
defined) have consummated the Preacquisition Transactions (as hereinafter
defined);
WHEREAS, as of the date hereof and after giving effect to the
Preacquisition Transactions, the Seller owns all of the outstanding limited
liability company interests (collectively, the "Securities") in the following
limited liability companies (collectively, the "Target Companies"):
(a) Republic Gypsum Operating LLC, a Delaware limited liability company
("RGCO");
1
7
(b) Republic Gypsum Holding LLC, a Delaware limited liability company
("RGCH");
(c) Republic Paperboard Company LLC, a Delaware limited liability
company ("RPC"); and
(d) XxXxxxx Minerals LLC, a Delaware limited liability company
("LPMC").
WHEREAS, as of the date hereof and after giving effect to the
Preacquisition Transactions, (i) RGCO and RGCH own all of the outstanding
limited partnership interests in Republic Gypsum Company LP, a Delaware limited
partnership ("RGC"), (ii) RGC owns all of the outstanding limited liability
company interests in Xxxxxx & Eastern Railroad Company LLC, a Delaware limited
liability company ("H&ERR"), and (iii) RPC owns all of the outstanding limited
liability company interests in Republic Fiber Company LLC, a Delaware limited
liability company ("RFC"), and Republic Resource Control LLC, a Delaware limited
liability company ("RCI" and, together with RGC, H&ERR and RFC, the "Target
Subsidiaries");
WHEREAS, the Purchasers desire to acquire the Securities, and the
Seller is willing to sell the Securities to the Purchasers, in each case upon
the terms and subject to the conditions set forth herein; and
WHEREAS, capitalized terms used herein without definition have the
respective meanings assigned to them in Section 10.1;
NOW, THEREFORE, in consideration of the premises, the terms and
provisions set forth herein, the mutual benefits to be gained by the performance
thereof and other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the parties hereto agree as follows:
ARTICLE I
PREACQUISITION TRANSACTIONS
SECTION 1.1. Reorganization of Republic Group Companies. Prior to the
date hereof, the Seller caused each of the Republic Group Companies to be
reincorporated under the laws of the state of Delaware through (i) the
incorporation of a new wholly owned Delaware subsidiary of the predecessor of
such Republic Group Company and (ii) the merger of the predecessor with and into
such new wholly owned subsidiary (collectively, the "Reincorporation
Transactions"). In addition, prior to the date hereof, the Seller caused all
shares of capital stock of Xxxxxx & Eastern Railroad Company not owned by
Republic Gypsum Company to be cancelled and converted into the right to receive
a payment in cash through (a) the contribution of all the outstanding
2
8
capital stock of Xxxxxx & Eastern Railroad Company owned by Republic Gypsum
Company to a new wholly owned subsidiary of Republic Gypsum Company and (b) the
merger of such subsidiary with and into Xxxxxx & Eastern Railroad Company
(collectively, the "H&ERR Merger"). Furthermore, prior to the date hereof and
after giving effect to the transactions described above, the Seller caused (1)
each of the Republic Group Companies other than Republic Gypsum Company to be
converted from a Delaware corporation into a Delaware limited liability company
through the filing of a certificate of conversion in accordance with the
conversion procedures set forth in Section 266 of the Delaware General
Corporation Law and (2) Republic Gypsum Company to be converted into a Delaware
limited partnership through the contribution of the outstanding capital stock of
Republic Gypsum Company to RGCO and RGCH and the filing of a certificate of
conversion in accordance with the conversion procedures set forth in Section 266
of the Delaware General Corporation Law (collectively, the "Conversion
Transactions"). The Seller has also caused all the shares of capital stock or
other equity securities of Duke Farmers Union Cooperative owned or held by it to
be contributed to H&ERR.
SECTION 1.2. Contribution and Sale of Certain Assets. Prior to the date
hereof, the Seller caused (i) RPC to effect a contribution (the "Hutchinson
Contribution") of certain assets and liabilities relating to its recycled
paperboard mill located in Hutchinson, Kansas to a newly formed Delaware limited
liability company ("HM") and (ii) RPC to sell to the Seller all of the
outstanding limited liability company interests in HM and Republic Paperboard
Company of West Virginia LLC ("RPCWV") in exchange for a promissory note (the
"Excluded Subsidiary Sale Promissory Note") in the principal amount of
$49,300,000 (the "Excluded Subsidiary Sale").
SECTION 1.3. Further Assurances. The parties hereto agree that from
time to time after the Closing Date each of them shall execute, deliver,
acknowledge, file and record, or cause to be executed, delivered, acknowledged,
filed and recorded, such additional assignments, conveyances and other documents
and instruments as any of the other parties may reasonably request in order to
complete and make effective the Reincorporation Transactions, the Conversion
Transactions, the H&ERR Merger, the Xxxxxxxxxx Contribution, the Excluded
Subsidiary Sale and the other transactions described in this Article I
(collectively, the "Preacquisition Transactions").
ARTICLE II
PURCHASE AND SALE OF SECURITIES
SECTION 2.1. Purchase and Sale of Securities. As of 7:00 a.m., Dallas,
Texas time, on the Closing Date (the "Closing Effective Time"), the Seller shall
sell, transfer,
3
9
assign and deliver to Acquisition Sub, and Acquisition Sub shall acquire and
accept from the Seller, the Securities.
SECTION 2.2. Assignment and Admission. As of the Closing Effective
Time, (i) the Seller shall execute and deliver assignments, in the forms set
forth as Exhibit A, in order to effectuate the sale, assignment, delivery and
conveyance of the Securities issued by each Target Company to Acquisition Sub
(the "Assignments") and (ii) Acquisition Sub, the Seller and each Target Company
shall execute agreements, in the forms set forth as Exhibit B, evidencing the
admission of Acquisition Sub as a member of each Target Company (the "Accession
Agreements"). Upon the execution and delivery of the Assignments and the
Accession Agreements, Acquisition Sub shall be admitted as a member of each
Target Company and shall be entitled to the rights and benefits of the sole
member of such Target Company in accordance with the terms of the Limited
Liability Company Agreement of such Target Company.
SECTION 2.3. Purchase Price. The purchase price to be paid by the
Purchasers to the Seller at the Closing Effective Time in consideration of the
sale, transfer, assignment and delivery of the Securities shall be an amount in
cash equal to $338,200,000 (the "Purchase Price"). In addition, at the Closing
Effective Time, Acquisition Sub shall assume the obligations of the Seller under
the Senior Subordinated Notes and the Senior Subordinated Note Indenture.
SECTION 2.4. Security for Certain Obligations. As a result of the
Preacquisition Transactions, one of the assets of Republic Gypsum Company is the
Excluded Subsidiary Sale Promissory Note, which is an unsecured obligation of
the Seller. In order to induce the Purchasers to execute and deliver this
Agreement and consummate the Acquisition Transactions, at the Closing Effective
Time, (i) HM and RPCWV shall execute and deliver the Guaranties pursuant to
which they will guarantee the payment of the principal of and interest on the
Excluded Subsidiary Sale Promissory Note and (ii) the Seller, HM and RPCWV shall
execute and deliver the Security Documents pursuant to which the Seller will
secure its obligations under the Excluded Subsidiary Sale Promissory Note with a
pledge of and security interest in the outstanding limited liability company
interests in HM and RPCWV and HM and RPCWV will secure their obligations under
the Guaranties with security interests in their properties and assets.
SECTION 2.5. Further Assurances. The parties hereto agree that from
time to time after the Closing Date each of them shall execute, deliver,
acknowledge, file and record, or cause to be executed, delivered, acknowledged,
filed and recorded, such additional documents and instruments as any of the
other parties may reasonably request in order to complete and make effective the
purchase and sale of the Securities and the other transactions to be consummated
on or after the date hereof in accordance with the terms of this Agreement
(collectively, the "Acquisition Transactions").
4
10
ARTICLE III
THE CLOSING
SECTION 3.1. Closing. The closing of the transactions contemplated by
this Agreement (the "Closing") shall be held at the offices of Xxxxxxx & Xxxxx
L.L.P., 0000 Xxxx Xxxxxx, Xxxxxx, Xxxxx 00000 as soon as practicable after the
fulfillment of the conditions set forth in Article VII.
SECTION 3.2. Deliveries; Certain Actions.
(a) At the Closing, the Seller shall deliver, or cause to be delivered,
to the Purchasers each of the following:
(i) counterparts of the Assignments for each of the Target
Companies, duly executed by the Seller;
(ii) counterparts of the Accession Agreements for each of the
Target Companies, duly executed by the Seller and each of the Target
Companies;
(iii) counterparts of the Trademark Assignment, duly executed
by the Seller;
(iv) a counterpart of the Assumption Agreement, duly executed
by the Seller;
(v) a counterpart of the Transition Services Agreement, duly
executed by the Seller;
(vi) a counterpart of the Management Agreement, duly executed
by the Seller, HM and RPCWV;
(vii) a counterpart of each of the Guaranties, duly executed
by HM or RPCWV, as the case may be;
(viii) a counterpart of each of the Security Documents, duly
executed by the Seller, HM or RPCWV, as the case may be;
(ix) a counterpart of the Supplemental Indenture, duly
executed by the Seller and the Trustee;
(x) copies of the documents required to be delivered to the
Trustee pursuant to Sections 7.04 and 8.03 of the Senior Subordinated
Note Indenture in connection with the sale of the Securities and the
execution of the Supplemental Indenture;
5
11
(xi) evidence satisfactory to the Purchasers that all amounts
owing under the Bank Credit Facility have been repaid and that all
liens, claims and encumbrances on the assets of the Target Companies
and the Target Subsidiaries arising under or in connection with such
facility will be released and terminated as promptly as practicable
after the Closing Effective Time;
(xii) evidence satisfactory to the Purchasers, in their
reasonable discretion, that all consents, approvals or authorizations
from any Governmental Authority or other Person required in order to
consummate the sale of the Securities and the other Transactions have
been obtained and are in full force and effect;
(xiii) the officers' certificate referred to in Section
7.2(e); and (xiv) the opinion of counsel referred to in Section 7.2(f).
(b) At the Closing, the Purchasers shall deliver, or cause to be
delivered, to the Seller each of the following:
(i) the Purchase Price by wire transfer of immediately
available funds to such bank account or accounts as shall have been
previously designated in writing by the Seller;
(ii) counterparts of the Accession Agreements for each of the
Target Companies, duly executed by Acquisition Sub;
(iii) a counterpart of the Assumption Agreement, duly executed
by Acquisition Sub;
(iv) a counterpart of the Transition Services Agreement, duly
executed by Acquisition Sub;
(v) a counterpart of the Management Agreement, duly executed
by Acquisition Sub;
(vi) a counterpart of the Supplemental Indenture, duly
executed by Acquisition Sub;
(vii) the officers' certificate referred to in Section 7.3(c);
and
(viii) the opinions of counsel referred to in Section 7.3(d)
and (f).
6
12
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
OF THE SELLER
The Seller hereby represents and warrants to the Purchasers as follows:
SECTION 4.1. Organization and Qualification.
(a) The Seller is a limited liability company duly formed, validly
existing and in good standing under the laws of the State of Delaware and has
all requisite power and authority as a limited liability company to own the
Securities and to conduct its business as now conducted. The Seller is duly
qualified to transact business as a foreign limited liability company and is in
good standing in each jurisdiction in which the failure to be so qualified or in
good standing could affect in any manner the performance by the Seller of its
obligations under this Agreement.
(b) Each of the Target Companies is a limited liability company duly
formed, validly existing and in good standing under the laws of the State of
Delaware and has all requisite power and authority as a limited liability
company to own, lease and operate its properties and to conduct its Businesses
as presently conducted. Each of the Target Companies is duly qualified to
transact business as a foreign limited liability company and is in good standing
in each jurisdiction in which the nature of its Businesses or activities or the
character of the properties that it owns, leases or operates makes such
qualification necessary, except as disclosed on Schedule 4.1 and except where
the failure to be so qualified or in good standing would not have a Material
Adverse Effect on such Target Company.
SECTION 4.2. Authority and Enforceability. The Seller has all necessary
limited liability company power and authority to enter into and perform its
obligations under this Agreement and to consummate the Transactions. The
execution and delivery of this Agreement by the Seller have been duly and
validly authorized by all necessary limited liability company action on the part
of the Seller, and no other proceedings or actions on the part of or with
respect to the Seller or its members are necessary to authorize this Agreement,
the performance by the Seller of its obligations hereunder or the consummation
by the Seller of the Transactions. This Agreement has been duly executed and
delivered by the Seller and constitutes a legal, valid and binding obligation of
the Seller, enforceable against the Seller in accordance with the terms hereof.
SECTION 4.3. Absence of Conflicts.
(a) The execution and delivery by the Seller of this Agreement, the
performance by the Seller of its obligations hereunder and the consummation by
the Seller of the Transactions will not (i) conflict with, or result in any
violation or breach of, any provision of the Limited Liability Company Agreement
of the Seller, (ii) except
7
13
as set forth in Schedule 4.3, conflict with, result in any violation or breach
of, constitute a default under, or require any consent, approval or
authorization from any Person pursuant to any term or provision of any note,
bond, mortgage, indenture, lease, franchise, permit, license, contract,
agreement or other instrument or document to which the Seller is a party or by
which its properties or assets are bound or (iii) conflict with, result in any
violation of or require any consent, approval or authorization pursuant to any
law, ordinance, statute, rule or regulation of any Governmental Authority or any
order, writ, injunction, judgment or decree of any court, arbitrator or
Governmental Authority applicable to the Seller or its properties or assets.
(b) The consummation of the Transactions will not (i) conflict with, or
result in any violation or breach of, any provision of the Limited Liability
Company Agreement or Partnership Agreement (as the case may be) of the Target
Companies or the Target Subsidiaries, (ii) except as set forth in Schedule 4.3,
conflict with, result in any violation or breach of, constitute a default under,
require any consent, approval or authorization from any Person pursuant to, or
give rise to any right of termination or acceleration (with or without notice or
the lapse of time or both) in respect of, or result in the diminution or
modification of any right or privilege granted under, any term or provision of
any material note, bond, mortgage, indenture, lease, franchise, permit, license,
contract, agreement or other instrument or document to which any of the Target
Companies or the Target Subsidiaries is a party or by which its properties or
assets are bound or (iii) conflict with, result in any violation of, or require
any consent, approval or authorization pursuant to any law, ordinance, statute,
rule or regulation of any Governmental Authority or any order, writ, injunction,
judgment or decree of any court, arbitrator or Governmental Authority applicable
to any of the Target Companies or the Target Subsidiaries or its properties or
assets.
SECTION 4.4. Governmental Consents and Filings. There is no requirement
applicable to the Seller, the Target Companies or the Target Subsidiaries to
obtain any consent, approval or authorization of, or to make or effect any
declaration, filing or registration with, any Governmental Authority for the
valid execution and delivery by the Seller of this Agreement, the due
performance by it of its obligations hereunder or the lawful consummation by it
of the Transactions, other than (i) filings made with respect to certain of the
Transactions pursuant to the HSR Act and the termination or expiration of the
waiting period prescribed by such Act, (ii) filings made prior to the date
hereof with the Secretary of State of Delaware in connection with the
Preacquisition Transactions and (iii) the consents, approvals, authorizations,
declarations, filings or registrations set forth on Schedule 4.4.
SECTION 4.5. Ownership and Transfer of Securities. The Seller is the
sole beneficial owner of the Securities, which represent the only outstanding
limited liability company interests in or other equity securities of the Target
Companies. The Securities are owned by the Seller free and clear of all liens,
claims, encumbrances or restrictions on transfer of any kind. Upon the sale,
transfer, assignment and delivery of the Securities in accordance with the terms
of this Agreement, the Purchasers will acquire good and marketable title to the
Securities, free and clear of all liens, claims, encumbrances or restrictions
8
14
on transfer of any kind (including, but not limited to, any liens, claims,
encumbrances or restrictions on transfer arising under or in connection with the
Bank Credit Facility or any other contract or agreement to which the Seller or
any of the Republic Group Companies is a party or by which it is bound), except
for any (i) claims, encumbrances or restrictions arising under the express terms
of this Agreement (ii) claims, encumbrances or restrictions assumed by the
Purchasers pursuant to the Supplemental Indenture, (iii) restrictions on
transfer imposed under any federal or state securities laws as a result of the
fact that the Securities have not be registered under the Securities Act or
registered or qualified under any state securities laws and (iv) liens, claims,
encumbrances or restrictions identified on Schedule 4.5.
SECTION 4.6. Capitalization. Schedule 4.6 sets forth the issued and
outstanding limited liability company interests in or other equity securities of
each of the Target Companies. All of the issued and outstanding limited
liability company interests in and other equity securities of the Target
Companies have been duly authorized, are validly issued, and are not subject to
any current or future capital calls or similar obligations except pursuant to
the Limited Liability Company Agreements to which the members thereof are
parties. None of the issued and outstanding limited liability company interests
in or other equity securities of the Target Companies have been issued in
violation of, or subject to, any preemptive rights or rights of subscription.
There are no outstanding options, warrants, calls, rights, convertible
securities or other agreements or commitments of any character pursuant to which
the Seller or the Target Companies are or may be obligated to issue or sell any
issued or unissued limited liability company interests or other equity
securities.
SECTION 4.7. Subsidiaries. Schedule 4.7 sets forth (i) the name of each
Target Subsidiary, (ii) the jurisdiction of formation of each Target Subsidiary,
(iii) the issued and outstanding equity securities of each Target Subsidiary and
(iv) the names of the other equity holders of each Target Subsidiary. The Target
Subsidiaries are the only Subsidiaries of the Target Companies and, except as
set forth in Schedule 4.7, the only corporations, partnerships, limited
liability companies or other Persons in which the Target Companies directly or
indirectly hold an equity interest. Each Target Subsidiary that is a limited
liability company is duly formed, validly existing and in good standing under
the laws of the State of Delaware and has all requisite power and authority as a
limited liability company to own, lease and operate its properties and to carry
on its business as presently conducted. Each Target Subsidiary that is limited
partnership is duly formed, validly existing and in good standing under the laws
of the State of Delaware and has all requisite power and authority as a limited
partnership to own, lease and operate its properties and to carry on its
Businesses as presently conducted. Except as set forth in Schedule 4.7, each
Target Subsidiary is duly qualified to transact
9
15
business as foreign limited liability company or foreign limited partnership (as
the case may be) and is in good standing in each jurisdiction in which the
nature of its Businesses or other activities or the character of the properties
it owns, leases or operates makes such qualification necessary, except where the
failure to be so qualified or in good standing would not have a Material Adverse
Effect on such Target Subsidiary. Except as set forth in Schedule 4.7, all of
the issued and outstanding equity interests (including equity interests in the
form of limited liability company interests and limited partnership interests)
in each Target Subsidiary (i) have been duly authorized, (ii) are validly
issued, (iii) are not subject to any current or future capital calls or similar
obligations except pursuant to the express terms of the Limited Liability
Company Agreements or Partnership Agreement (as the case may be) to which the
members or partners thereof are parties and (iv) are owned by one of the Target
Companies, directly or indirectly, free and clear of all liens, claims,
encumbrances or restrictions on transfer of any kind (including, but not limited
to, any liens, claims, encumbrances or restrictions on transfer arising under or
in connection with the Bank Credit Facility or any other contract or agreement
to which the Seller or any of the Republic Group Companies is a party or by
which it is bound), except for (A) liens, claims or other encumbrances arising
under the express terms of the Limited Liability Company Agreements or
Partnership Agreement (as the case may be) to which the members or partners
thereof are parties, (B) claims, encumbrances or restrictions assumed by the
Purchasers pursuant to the Supplemental Indenture, and (C) restrictions on
transfer imposed under any federal or state securities laws as a result of the
fact that the equity interests therein have not been registered under the
Securities Act or registered or qualified under any state securities laws. None
of the issued and equity securities of any of the Target Subsidiaries have been
issued in violation of, or subject to, any preemptive rights or rights of
subscription. There are no outstanding options, warrants, calls, rights,
convertible securities or other agreements or commitments of any character
pursuant to which the Target Companies or any of the Target Subsidiaries is or
may be obligated to issue or sell any issued or unissued equity interests in any
Target Subsidiary.
SECTION 4.8. Financial Statements. The Seller has delivered to the
Purchasers copies of financial statements (the "Financial Statements")
consisting of a consolidated balance sheet of the Seller and the Republic Group
Companies, dated as of September 30, 2000 (the "Balance Sheet"), and a
consolidated statement of operations and statement of cash flows of the Seller
and the Republic Group Companies for the three-months then ended, which are
attached hereto as Schedule 4.8. The Financial Statements, to the extent that
the financial information contained therein relates to the Target Companies and
the Target Subsidiaries and their respective Businesses, have been prepared in
accordance with GAAP and fairly present in all material respects the
consolidated financial condition of the Target Companies and the Target
Subsidiaries and the consolidated results of operations and cash flows of such
companies for the three months then ended.
10
16
SECTION 4.9. Absence of Undisclosed Liabilities. As of the date of the
Balance Sheet, there were no debts, liabilities or obligations (whether
absolute, contingent, known or unknown, asserted or unasserted, accrued,
unliquidated or otherwise) of the Target Companies or the Target Subsidiaries,
except as reflected on or disclosed in the Balance Sheet or as described in
Schedule 4.9. Since the date of the Balance Sheet, the Target Companies and the
Target Subsidiaries have not incurred any debts, liabilities or obligations
(whether absolute, contingent, known or unknown, asserted or unasserted,
accrued, unliquidated or otherwise), except for (i) debts, liabilities and
obligations described in Schedule 4.9 and (ii) other debts, liabilities and
obligations which individually do not exceed $25,000 and in the aggregate do not
exceed $100,000.
SECTION 4.10. Absence of Certain Changes or Events. Except as set forth
in Schedule 4.10 or as otherwise disclosed in writing to the Purchasers prior to
the date hereof, since June 30, 2000, the Target Companies and Target
Subsidiaries have conducted their respective Businesses only in the ordinary
course and in a manner that is consistent in all material respects with past
practice, and there has not been any Material Adverse Change or any event,
occurrence or development that is reasonably likely to result in a Material
Adverse Change. Without limiting the generality of the foregoing, except as set
forth in Schedule 4.10, since June 30, 2000, none of the Target Companies or
Target Subsidiaries has (i) amended its Limited Liability Company Agreement or
Partnership Agreement (as the case may be); (ii) issued, sold or disposed of any
equity securities or any options, warrants, calls or other rights to acquire any
equity securities; (iii) consolidated with, or merged with or into, any Person
(except pursuant to the Preacquisition Transactions); (iv) declared, set aside
or paid any dividend or other distribution (whether in cash, stock or property);
(v) reclassified, combined, split or subdivided any of its equity securities;
(vi) changed its accounting principles or methods, except as required by law or
as a result of any mandatory change in accounting standards; (vii) failed to
maintain its books and records in the usual, regular and ordinary manner; (viii)
sold, assigned or disposed of any properties or assets of any kind or character,
other than properties and assets sold, assigned or disposed of in the ordinary
course of business and in a manner consistent with past practice; (ix) suffered
any substantial damage, destruction or loss (whether or not insured against)
affecting any material properties or assets; or (x) suffered any revocation or
termination, or received any notice of any threatened revocation or termination,
of any material consents, approvals, licenses, permits, franchises and other
authorizations.
SECTION 4.11. Litigation. Except as set forth on Schedule 4.11, there
are no actions, suits, inquiries, investigations or other proceedings pending
or, to the knowledge of the Seller, threatened against the Target Companies or
the Target Subsidiaries or their respective properties or assets which are
reasonably likely to (i) have a Material Adverse Effect or (ii) prevent,
restrict or hinder the sale of the Securities or the consummation of any of the
other Transactions.
11
17
SECTION 4.12. Compliance with Laws and Other Requirements. Except as
set forth on Schedule 4.12, none of the Target Companies or Target Subsidiaries
is in breach or violation of any provision of its Limited Liability Company
Agreement or Partnership Agreement (as the case may be), any term or provision
of any note, bond, mortgage, indenture, lease, franchise, permit, license,
contract, agreement or other instrument or document to which it is a party or by
which its properties or assets are or may be bound or, any term of any law,
ordinance, statute, rule or regulation of any Governmental Authority or of any
order, writ, injunction, judgment or decree of any court, arbitrator or
Governmental Authority applicable to it or its properties or assets, except for
any breach, violation or default which is not reasonably likely to (i) have a
Material Adverse Effect or (ii) prevent, restrict or hinder the sale of the
Securities or the consummation of any of the other Acquisition Transactions.
Notwithstanding the foregoing, Seller does not make any representation or
warranty pursuant to this Section 4.12 with respect to compliance with
Environmental Laws, which matters are governed by Section 4.16.
SECTION 4.13. Premier/Republic Merger. The Premier/Republic Merger was
duly and validly consummated on November 9, 2000 in accordance with the Delaware
General Corporation Law and the provisions of the Premier/Republic Merger
Agreement. As of the effective time of the Premier/Republic Merger, neither
Premier nor the Seller was in breach in any material respect of any
representation, warranty, covenant, agreement or other term or provision
contained in the Premier/Republic Merger Agreement. Except as described in
Schedule 4.13, no waiver of any such representation, warranty, covenant,
agreement or other term or provision was granted by any party to the
Premier/Republic Merger Agreement.
SECTION 4.14. Senior Subordinated Note Indenture. The Seller is in
compliance in all material respects with the terms and conditions of the Senior
Subordinated Notes and the Senior Subordinated Note Indenture. Without limiting
the generality of the foregoing, the Premier/Republic Merger complied in all
respects with the applicable provisions of the Senior Subordinated Notes and the
Senior Subordinated Note Indenture, including, but not limited to, Section 8.01
of the Senior Subordinated Note Indenture, and after giving effect to such
merger no Default (as defined in the Senior Subordinated Note Indenture) or
Event of Default (as defined in the Senior Subordinated Note Indenture) has
occurred. Assuming that the parties execute and deliver the documents referred
to in Section 3.2(a)(vi) and (vii) at the Closing, the Acquisition Transactions
will comply in all respects with Subordinated Note Indenture, including, but not
limited to, Section 8.01 of the Senior Subordinated Note Indenture, and after
giving effect to such transactions no Default or Event of Default shall have
occurred.
12
18
SECTION 4.15. Properties and Assets.
(a) Assets Other than Real Property Interests. The Target Companies and
Target Subsidiaries have good and valid title to all material assets owned by
them, in each case free and clear of all pledges, claims, charges, mortgages,
liens, security interests or encumbrances of any kind except (i) mechanics',
carriers', workmen's, repairmen's or other like liens arising or incurred in the
ordinary course of business, liens arising under original purchase price
conditional sales contracts and equipment leases with third parties entered into
in the ordinary course of business if the underlying obligations are not overdue
for a period of more than 90 days, and liens for Taxes which are not yet due and
payable, (ii) mortgages, liens, security interests and encumbrances which secure
debt that is reflected as a liability on the Balance Sheet and the existence of
which is indicated in the notes thereto and (iii) other imperfections of title
or encumbrances, if any, which do not, individually or in the aggregate,
materially impair the continued use and operation or the marketability of the
assets to which they relate in the Businesses as presently conducted (the
mortgages, liens, security interests, encumbrances and imperfections of title
described in clauses (i), (ii) and (iii) above are hereinafter referred to
collectively as "Permitted Liens").
All the material tangible personal property of the Target Companies and
Target Subsidiaries has been maintained in all material respects in accordance
with the past practice of the Target Companies and the Target Subsidiaries and
generally accepted industry practice. Each item of material tangible personal
property of the Target Companies and the Target Subsidiaries is in all material
respects in good working order and is adequate and sufficient for the Target
Company's or Target Subsidiary's intended purposes, ordinary wear and tear
excepted.
This Section 4.15(a) does not relate to real property or interests in
real property, such items being the subject of Section 4.15(b).
(b) Title to Real Property. Schedule 4.15(b) sets forth a complete list
of all real property owned in fee by the Target Companies and Target
Subsidiaries (individually, an "Owned Property"). Schedule 4.15(b) sets forth a
complete list of all real property and interests in real property leased by the
Target Companies and Target Subsidiaries (individually, a "Leased Property") and
identifies any material leases relating thereto. The applicable Target Company
or Target Subsidiary has (i) good and marketable fee title to all Owned Property
insurable at regular rates and (ii) good and valid title to the leasehold
estates in all Leased Property (an Owned Property or Leased Property being
sometimes referred to herein, individually, as a "Target Property" and,
collectively, as "Target Properties"), in each case free and clear of all
mortgages, liens, security interests, encumbrances, leases, assignments,
subleases, easements, covenants, rights-of-way and other similar restrictions of
any nature whatsoever, except (A) leases, subleases and similar agreements set
forth in Schedule 4.15(b), (B) Permitted Liens, (C)
13
19
easements, covenants, rights-of-way and other similar restrictions of record,
(D) any conditions that would be shown by a current, accurate survey or physical
inspection of any Target Property made prior to Closing and (E) (I) zoning,
building and other similar restrictions, (II) mortgages, liens, security
interests, encumbrances, easements, covenants, rights-of-way and other similar
restrictions that have been placed by any developer, landlord or other third
party on property over which the Target Company or a Target Subsidiary has
easement rights or on any Leased Property and subordination or similar
agreements relating thereto and (III) unrecorded easements, covenants,
rights-of-way and other similar restrictions, none of which items set forth in
clauses (C), (D) and (E), individually or in the aggregate, materially impair
the value or the continued use and operation of the property to which they
relate in the Businesses as presently conducted. No local zoning or similar land
use or government regulations materially impairs the current use by the Target
Companies and Target Subsidiaries of the plants, offices and other facilities
located on Target Property.
SECTION 4.16. Environmental Matters. Except as described in Schedule
4.16, the Target Companies and Target Subsidiaries are in compliance with all
applicable federal, state and local laws and regulations (including common law)
relating to pollution or protection of human health or the environment
(including ambient air, surface water, ground water, land surface or subsurface
strata) (collectively, "Environmental Laws"), except for any non-compliance
which has not and, if continued, would not, individually or in the aggregate,
have a Material Adverse Effect on the Target Companies and Target Subsidiaries
taken as a whole. For purposes of the immediately preceding sentence, compliance
with Environmental Laws includes, but is not limited to, the possession by the
Target Companies and Target Subsidiaries of all permits and other governmental
authorizations required under applicable Environmental Laws. The Target
Companies and Target Subsidiaries are in material compliance with the terms and
conditions thereof. Except as described in Schedule 4.16, neither the Target
Companies nor the Target Subsidiaries has received written notice of, or is the
subject of any facts, circumstances or conditions that could reasonably be
expected to result in, any actions, causes of action, claims, investigations,
demands or notices by any person alleging liability under or non-compliance with
any Environmental Law ("Environmental Claims") which has had or, if continued,
would have, individually or in the aggregate, a Material Adverse Effect on the
Target Companies and Target Subsidiaries taken as a whole.
SECTION 4.17. Taxes.
(a) All Tax Returns required to be filed by the Target Companies or the
Target Subsidiaries on or before the date hereof have been filed within the time
prescribed by law (including extensions of time approved by the appropriate
taxing authority). Such Tax Returns accurately and completely set forth in all
material respects all liabilities for Taxes (if any) and any other items
(including, but not limited
14
20
to, items of income, gain, loss, deduction or credit) required (under applicable
tax law) to be reflected or included in such Tax Returns. The Target Companies
and the Target Subsidiaries have paid on a timely basis all Taxes due on or
before the date hereof, except those Taxes that are being disputed in good faith
and for which adequate provision has been made in the Balance Sheet. There are
no Taxes that are or will be owing by the Target Companies or the Target
Subsidiaries for any taxable period of the Company ending prior to or on the
Closing Date, except for Taxes for which adequate provision has been made on the
Balance Sheet. Except as set forth in Schedule 4.17, there are no pending
audits, actions, proceedings, investigations, disputes or claims with respect to
any Taxes payable by or asserted against the Target Companies or the Target
Subsidiaries.
(b) The Target Companies and Target Subsidiaries have not filed and
will not file any election under the "check-the-box" rules of the Internal
Revenue Code and Regulation Section 301.7701-3(b)(1)(ii) to be treated as
associations taxable as corporations for federal income tax purposes. At the
Closing Effective Time, each of the Target Companies and Target Subsidiaries
will be disregarded entities for federal income tax purposes under the default
provision of the aforementioned "check-the-box" rules.
SECTION 4.18. Employee Benefit Plans.
(a) Schedule 4.18 contains a list of each "employee pension benefit
plan" (as defined in Section 3(2) of ERISA) (sometimes referred to herein as a
"Pension Plan"), each "employee welfare benefit plan" (as defined in Section
3(1) of ERISA) (sometimes referred to herein as a "Welfare Plan"), each
employment contract, stock option, stock purchase, deferred compensation plan or
arrangement and each other employee fringe benefit plan or arrangement
maintained, contributed to or required to be maintained or contributed to by the
Seller, the Target Companies and Target Subsidiaries or any other person or
entity that, together with the Seller, the Target Companies and Target
Subsidiaries is or was treated as a single employer under Section 414(b), (c),
(m) or (o) of the Internal Revenue Code (each, a "Commonly Controlled Entity")
for the benefit of any current or former directors, officers, employees or
independent contractors of the Seller, the Target Companies and Target
Subsidiaries (collectively, "Seller Benefit Plans"). The Seller has delivered or
made available to the Purchasers true, complete and correct copies of (w) each
Seller Benefit Plan, (x) the two most recent annual reports on Form 5500 filed
with the Internal Revenue Service with respect to each Seller Benefit Plan (if
any such report was required), (y) the most recent summary plan description for
each Seller Benefit Plan for which such summary plan description is required,
and (z) each currently effective trust agreement, insurance or group annuity
contract and each other funding or financing arrangement relating to any Seller
Benefit Plan.
15
21
(b) Except as disclosed on Schedule 4.18, (1) each Seller Benefit Plan
has been administered in accordance with its terms, and the Seller, the Target
Companies and Target Subsidiaries, and all the Seller Benefit Plans are in
compliance with the applicable provisions of ERISA, the Internal Revenue Code
and all other applicable laws and the terms of all applicable collective
bargaining agreements, except for any failure to so administer or any
non-compliance that has not and, if continued, would not, individually or in the
aggregate, have a material adverse effect on the Seller and the Target Companies
and Target Subsidiaries taken as a whole, (2) there are no pending or, to the
Seller's knowledge, threatened, (A) investigations by any Federal, state or
local government or any court, administrative or regulatory agency or commission
or other governmental authority or agency, domestic or foreign, (B) termination
proceedings or other claims (except routine claims for benefits payable under
the Seller Benefit Plans), (C) suits or (D) proceedings against or involving any
Seller Benefit Plan or asserting any rights or claims to benefits (except for
routine claims for benefits) under any Seller Benefit Plan, and (3) all reports,
returns and similar documents with respect to the Seller Benefit Plans required
to be filed with any governmental agency or distributed to any Seller Benefit
Plan participant have been duly, timely, and accurately filed or distributed.
(c) Except as described on Schedule 4.18, (1) all contributions to, and
payments from, the Seller Benefit Plans that may have been required to be made
in accordance with the terms of the Seller Benefit Plans, any applicable
collective bargaining agreement and, when applicable, Section 302 of ERISA or
Section 412 of the Internal Revenue Code, have been timely made, except for any
such untimely payment that has not and, if continued, would not, individually or
in the aggregate, have a material adverse effect on the Seller and the Target
Companies and Target Subsidiaries taken as a whole, (2) there has been no
application for waiver or waiver of the minimum funding standards imposed by
Section 412 of the Internal Revenue Code with respect to any Pension Plan of the
Seller, (3) no Pension Plan of the Seller has or had at any time during the
current plan year an "accumulated funding deficiency" within the meaning of
Section 412(a) of the Internal Revenue Code and (4) there is no liability under
Title IV of ERISA with respect to any Seller Benefit Plan (except for insurance
premiums payable to the Pension Benefit Guaranty Corporation which are not yet
due) that has not been satisfied as of the date hereof.
(d) Each Pension Plan of the Seller that is intended to be a
tax-qualified plan has been the subject of a determination letter from the
Internal Revenue Service to the effect that such Pension Plan and related trust
is qualified and exempt from U.S. Federal income Taxes under Sections 401(a) and
501(a), respectively, of the Internal Revenue Code; no such determination letter
has been revoked; and, to the knowledge of the Seller, no such revocation has
been threatened. No such Pension Plan has been amended since the effective date
of its most recent determination letter in any respect that would adversely
affect its qualification, materially increase its costs or require
16
22
security under Section 307 of ERISA. Furthermore, each Pension Plan of the
Seller that is intended to be tax qualified has been timely and properly amended
since each respective Pension Plan's effective date to comport with any changes
in the Internal Revenue Code, ERISA, or other applicable federal or state law
which might otherwise effect such Pension Plan's tax qualified status. The
Seller has delivered or made available to the Trust a copy of the most recent
determination letter received with respect to each Pension Plan of the Seller.
(e) Except as disclosed in Schedule 4.18, no director, independent
contractor or employee of the Seller, the Target Companies or Target
Subsidiaries will be entitled to any additional benefits or any acceleration of
the time of payment or vesting of any benefits under any Seller Benefit Plan as
a result of the transactions contemplated by this Agreement.
(f) Schedule 4.18 contains a list of all Seller Benefit Plans which
provide for accelerated vesting or payment of any benefits as a result of a
change in control.
(g) Except as disclosed in Schedule 4.18(h) or as required or
contemplated by the terms of this Agreement, since the date of the Seller
Balance Sheet there has not been any adoption or amendment in any material
respect (except as required by applicable law), or any agreement to adopt or
amend in any material respect, by the Seller or any of its subsidiaries of any
collective bargaining agreement or employment contract or any bonus, pension,
profit sharing, deferred compensation, incentive compensation, stock ownership,
stock purchase, stock option, phantom stock, retirement, vacation, severance,
disability, death benefit, hospitalization, medical or other plan, arrangement
or understanding (whether or not legally binding) providing benefits to any
current or former director, officer or employee of the Seller, the Target
Companies or Target Subsidiaries (the "Seller Plans"). Without limiting the
foregoing, except as disclosed in Schedule 4.18, since the date of the Balance
Sheet, there has not been any change in any actuarial or other assumption used
to calculate funding obligations with respect to any Pension Plan of the Seller,
or in the manner in which contributions to any Pension Plan of the Seller are
made or the basis on which such contributions are determined. Except as
disclosed in Schedule 4.18, there exist no employment, consulting, severance,
termination or indemnification agreements, arrangements or understandings
between the Seller, the Target Companies or Target Subsidiaries and any current
or former director, officer or employee of the Seller, the Target Companies or
Target Subsidiaries.
SECTION 4.19. Labor Matters. Except as set forth on Schedule 4.19, none
of the Target Companies nor the Target Subsidiaries is a party to any collective
bargaining agreement, memorandum of understanding, settlement or other labor
agreement with any union or labor organization, and no union or labor
organization has been recognized by any Target Company or Target Subsidiary as
an exclusive bargaining representative
17
23
for employees of such Target Company or Target Subsidiary. Except as set forth
on Schedule 4.19, to the knowledge of the Seller, there is no current union
representation question involving employees of any of the Target Companies or
Target Subsidiaries, not does the Seller have knowledge of any significant
activity or proceeding of any labor organization (or representative thereof) or
employee group to organize any such employees. Except as disclosed on Schedule
4.19, none of the Seller, the Target Companies or Target Subsidiaries has made
any commitment that would require the application of the terms of any collective
bargaining agreements entered into by the Seller or the Republic Group Companies
to the Purchasers or their Affiliates. Except as disclosed on Schedule 4.19,
there is no material labor dispute, strike, picketing or work stoppage, or any
lockout, involving employees of the Target Companies or Target Subsidiaries
pending or, to the knowledge of the Seller, threatened against or involving the
Target Companies or the Target Subsidiaries.
SECTION 4.20. Intellectual Property Rights. The Target Companies or
Target Subsidiaries (i) own, or are validly licensed or otherwise have the right
to use, all Intellectual Property Rights that are material to the conduct of the
Businesses as a whole and (ii) have taken such steps to preserve such
Intellectual Property Rights as the Seller has determined to be appropriate.
Schedule 4.20 sets forth a description of all Intellectual Property Rights that
are material to the conduct of the Businesses as a whole, and, to the Seller's
knowledge, all such Intellectual Property Rights are valid and enforceable. No
claims are pending or, to the knowledge of the Seller, threatened that the
Seller, the Target Companies or the Target Subsidiaries is infringing or
otherwise adversely affecting the Intellectual Property Rights of any person,
and the Seller is not aware of any basis for any such claims. To the knowledge
of the Seller, no person is infringing the rights of the Seller, the Target
Companies or Target Subsidiaries with respect to any Intellectual Property
Right. None of the Seller's Intellectual Property Rights are licensed to any
third party. Except as disclosed in the Schedule 4.20, no material Intellectual
Property Right is subject to any outstanding judgment, injunction, order,
decree, or agreement restricting the use thereof by the Seller, the Target
Companies or the Target Subsidiaries or restricting the licensing thereof by the
Seller, the Target Companies or the Target Subsidiaries.
SECTION 4.21. Insurance. Schedule 4.21 sets forth a true and correct
list of all liability and other insurance policies maintained by or with respect
to the Target Companies or the Target Subsidiaries which provide coverage in
connection with the Businesses. All such insurance policies are in full force
and effect and no notice of cancellation or termination has been received with
respect to any such policy.
SECTION 4.22. Brokers' or Finders' Fees. Except as set forth in the
Schedules to the Agreement, the Seller has not authorized any broker, finder or
investment banker to act on its behalf or on behalf of the Target Companies or
the Target Subsidiaries in connection with this Agreement or the transactions
contemplated hereby in such a
18
24
manner as to give rise to a valid claim against the Purchasers for any brokerage
or finder's fee or other fees or commissions.
ARTICLE V
REPRESENTATIONS AND WARRANTIES
OF THE PURCHASERS
The Purchasers hereby jointly and severally represent and warrant to
the Seller as follows:
SECTION 5.1. Organization. Each Purchaser is a corporation duly
incorporated, validly existing and in good standing under the laws of its state
of incorporation and has all requisite corporate power and authority to conduct
its business as now conducted. Each Purchaser is duly qualified to transact
business as a foreign corporation and is in good standing in each jurisdiction
in which the failure to be so qualified or in good standing could affect in any
manner the performance by such Purchaser of its obligations under this
Agreement.
SECTION 5.2. Authority and Enforceability. The Purchasers have all
requisite power and authority to enter into and perform their obligations under
this Agreement and to consummate the Transactions. The execution and delivery by
the Purchasers of this Agreement, the performance by the Purchasers of their
obligations hereunder and the consummation by the Purchasers of the Transactions
have been duly and validly authorized by all necessary action on the part of the
Purchasers, and no other proceedings or actions on the part of or with respect
to Purchasers or their stockholders are necessary. This Agreement has been duly
executed and delivered by the Purchasers and constitutes a legal, valid and
binding agreement of each Purchaser, enforceable against each Purchaser in
accordance with the terms hereof.
SECTION 5.3. Absence of Conflicts. The execution and delivery by the
Purchasers of this Agreement, the performance by the Purchasers of their
obligations hereunder and the consummation by the Purchasers of the Transactions
will not (i) conflict with, or result in any violation or breach of, any
provision of the Charter or Bylaws of either of the Purchasers, (ii) conflict
with, result in any violation or breach of, or constitute a default under, or
require any consent, approval or authorization from any Person not obtained as
of the date hereof pursuant to, any term or provision of any material note,
bond, mortgage, indenture, lease, franchise, permit, license, contract,
agreement or other instrument or document to which either of the Purchasers is a
party or by which its properties or assets are bound or (iii) conflict with, or
result in any violation of, any law, ordinance, statute, rule or regulation of
any Governmental Authority or of any order, writ, injunction, judgment or decree
of any court, arbitrator or Governmental Authority applicable to either of the
Purchasers or its properties or assets.
19
25
SECTION 5.4. Governmental Consents and Filings. There is no requirement
applicable to the Purchasers to obtain any consent, approval or authorization
of, or to make or effect any declaration, filing or registration with, any
Governmental Authority for the valid execution and delivery by the Purchasers of
this Agreement, the due performance by them of their obligations hereunder or
the lawful consummation by them of the Transactions, other than filings made
with respect to certain of the Transactions pursuant to the HSR Act and the
termination or expiration of the waiting period prescribed by such Act.
SECTION 5.5. Securities Act; Investment Representation. The Purchasers
are acquiring the Securities solely for the purpose of investment and not with a
view to, or for sale in connection with, any distribution thereof within the
meaning of the Securities Act. The Purchasers acknowledge that the Securities
have not been registered under the Securities Act or any applicable state
securities law, and may not be transferred or sold except pursuant to the
registration provisions of such Securities Act or pursuant to an applicable
exemption therefrom and pursuant to applicable state securities laws and
regulations as applicable. The Purchasers are knowledgeable, sophisticated and
experienced in business and financial matters of the type contemplated by this
Agreement and are able to bear the economic risks associated with their
investment in the Target Companies and the Target Subsidiaries.
SECTION 5.6. Financing. The Purchasers have the funds necessary to
consummate the purchase of the Securities and any related transactions.
SECTION 5.7. Brokers' or Finders' Fees. The Purchasers have not
authorized any broker or finder or investment banker to act on their behalf in
connection with this Agreement or the transactions contemplated hereby in such a
manner as to give rise to a valid claim against the Seller or any of its
subsidiaries or stockholders for any brokerage or finders' fees or other fees or
commissions.
SECTION 5.8. Litigation. There are no actions, suits, inquiries,
investigations or other proceedings pending or, to the knowledge of the
Purchasers, threatened against the Purchasers, or any of them, or their
respective properties or assets which are reasonably likely to prevent, restrict
or hinder the sale of the Securities or any of the other Transactions.
ARTICLE VI
CERTAIN COVENANTS AND AGREEMENTS
SECTION 6.1. Commercially Reasonable Efforts. Subject to the terms and
conditions hereof, each of the parties hereto shall use commercially reasonable
efforts to take, or cause to be taken, all actions and to do, or cause to be
done, all things which
20
26
are necessary, proper or advisable in order to consummate and make effective the
Transactions in accordance with the terms and provisions set forth in this
Agreement, including, but not limited to, (i) obtaining any consents, approvals
or authorizations of, or making or effecting any declarations, filings or
registrations with, any Governmental Authority required in connection with the
Transactions, (ii) obtaining any waivers, consents or approvals from any other
Persons required in connection with the Transactions, (iii) defending any
actions, suits or proceedings brought by any Person that seek to prohibit,
restrict or hinder the consummation of the Transactions and (iv) executing any
agreements, certificates, instruments and other documents required to consummate
the Transactions or carry out the purposes and intent of this Agreement.
SECTION 6.2. Change of Name. From and after the Closing Effective Time,
the Seller shall cease to use or employ in any manner the name "Republic" or any
derivatives thereof (including, but not limited to, "Republic Gypsum" or
"Republic Paperboard") in connection with the conduct of its businesses or the
businesses of the Republic Group Companies directly or indirectly owned by it;
provided, however, that during the 12 month period after the Closing Date, the
Seller, HM and RPCWV may, so long as (in the case of HM and RPCWV) they continue
to be wholly owned Subsidiaries of the Seller, continue to use the name
"Republic" in connection with their respective businesses in the same manner as
such entities or their predecessors used those names prior to the Closing
Effective Time, subject in each case to such reasonable limitations and other
provisions regarding the use of such name as the Purchasers may from time to
time impose in order to preserve and protect their rights to the name
"Republic." No later than five business days after the end of the 12-month
period referred to above, the Seller shall, if necessary, (i) change its name,
and cause the name of each of HM and RPCWV to be changed, to a name that does
not contain the name "Republic" or any derivatives thereof and (ii) file, and
cause each of HM and RPCWV to file, withdrawal notices for any assumed name
certificates bearing the name "Republic" or any derivatives thereof. Subject to
the existing contractual commitments of the Seller, the Seller shall execute any
consent or other document reasonably requested by the Purchaser in order to
evidence that the Purchasers, the Target Companies and the Target Subsidiaries
are authorized to use the names "Republic" or any derivatives thereof at all
times from and after the Closing Date.
SECTION 6.3. Financial Statements, Books and Records. The Seller agrees
to provide to the Purchasers, at the sole cost and expense of the Seller,
audited financial statements of Seller (or its predecessors) as of June 30, 2000
and for the three fiscal years then ended, and one or more consents from the
independent accountants who audited such financial statements, so as to enable
the Purchasers and their Affiliates to timely comply with applicable federal
securities laws, including, but not limited to, the requirements of Item 7(b) of
Form 8-K and Rule 3-05 of Regulation S-X, both promulgated pursuant to the
Securities Exchange Act of 1934, as amended. Furthermore, each of the Purchasers
and the Seller agrees that, for a period of four years
21
27
after the Closing Date (or such longer period as any party shall reasonably
request), it shall, at the sole cost and expense of the party requesting the
same, provide or make available to any other party for review and copying such
books, records and other information relating to the Republic Group Companies at
such times as the other party shall reasonably request for purposes of complying
with the provisions of any applicable law, rule or regulation.
SECTION 6.4. Employees and Plans.
(a) The Seller agrees to take all action required to ensure that, prior
to the Closing Effective Time, (i) all hourly employees and salaried employees,
if any, who are employed by any Target Companies or Target Subsidiaries and who
perform substantially all of their services for or with respect to the recycled
paperboard mill in Hutchinson, Kansas, are transferred to the employ of HM; (ii)
all hourly employees and salaried employees, if any, who are employed by any of
the Target Companies or Target Subsidiaries and who perform substantially all of
their services for or with respect to RPCWV or the recycled paperboard mill in
Halltown, West Virginia are transferred to the employ of RPCWV; (iii) all hourly
employees and salaried employees, if any, who are employed by any of the Target
Companies or Target Subsidiaries and who perform substantially all of their
services for or at Seller's headquarters located at 000 Xxxx 00xx Xxxxxx,
Xxxxxxxxxx, Xxxxxx, 00000, are transferred to the employ of Seller; and (iv) all
salaried employees and hourly employees who are employed by the Seller or any of
the Retained Companies and who perform substantially all of their services for
or with respect to one of the Target Companies or Target Subsidiaries (other
than the employees referred to in clause (iii) above), are transferred to the
employ of the applicable Target Company or Target Subsidiary.
(c) The Seller agrees to take all action required (i) to transfer
sponsorship of the Republic Paperboard Company Pension Plan and Trust (as
revised and restated effective January 1, 1989) from RPC to HM and (ii) to
transfer sponsorship of any other Seller Benefit Plans sponsored by any of the
Target Companies or the Target Subsidiaries, if any, to the Seller, such
transfers to occur prior to the Closing Effective Time.
(d) The Seller agrees that it shall continue to maintain and have full
responsibility for compliance with ERISA, the Internal Revenue Code and all
other laws and regulations applicable to each of the Seller Benefit Plans on and
after the Closing Date; provided, however, that this undertaking shall not be
construed to diminish or otherwise affect the obligations of Acquisition Sub
under the Management Agreement or the Assumption Agreement. The Purchasers and
the Seller shall cooperate in arranging for the Purchasers to provide benefits
substantially comparable to those provided under the Welfare Plans for all
former employees of Republic who are employed after the Closing Date by
Purchasers or their Affiliates, including the Target
22
28
Companies and the Target Subsidiaries. The Seller shall continue to provide
benefits under the Seller Benefit Plans to the extent required to assure
compliance with the terms of Section 5.4 of the Premier/Republic Merger
Agreement for employees of HM and RPCWV and any other employees of the Retained
Companies (other than any such employees who become employees of the Purchasers
or their Affiliates, including the Target Companies and the Target
Subsidiaries).
(e) The Seller agrees to cooperate with the Purchasers in connection
with the implementation by the Purchasers of plans substantially comparable to
the Seller Benefit Plans, so that Purchasers can satisfy their obligations under
the Assumption Agreement and this Agreement. Such cooperation shall include, if
requested by the Purchasers, a transfer of assets from or a merger of the
Republic Group Incorporated Employee Stock Ownership Plan into an appropriate
plan maintained by one of the Purchasers. Furthermore, the parties hereto agree
to cooperate in terminating the Republic Group Incorporated 401(k) Plan,
beginning not later than one year after the Closing Date or the date Seller and
its affiliates cease to employ any participants with account balances under such
plan, whichever date is later, and in the distribution or transfer of employees'
accounts under such plan.
(f) Acquisition Sub hereby assumes and agrees to honor the Collective
Bargaining Agreements listed in Schedule 4.19 with respect to employees of the
Target Companies and Target Subsidiaries whose terms of employment are subject
to such agreements.
(g) The Purchasers jointly and severally represent and warrant to
Seller that there will be no major employment losses as a consequence of the
Acquisition Transactions that will trigger obligations under the WARN Act ("WARN
Obligations"). To the extent that any WARN Obligations arise or accrue following
the Acquisition Transactions, it is agreed that Seller is and shall be
responsible for and shall pay only those WARN Obligations arising as a result of
any employment losses occurring prior to Closing Effective Time, and Purchasers
are and shall be responsible for and pay any WARN Obligations arising as a
result of any employment losses occurring after such time. Furthermore, for a
period of 90 days after the Closing Date, the Purchasers shall not engage in any
mass layoff, plant closing or other action that triggers obligations of the
Seller under the WARN Act or any similar provisions of any Federal, state or
local law, rule or regulation.
(h) Nothing in this Agreement, express or implied, shall confer upon
any employee of Seller and its affiliates or Purchasers and their affiliates, or
upon any representative of such employee, or upon any person claiming through
such employee, or upon any collective bargaining agent, any rights or remedies,
including any right to employment or continued employment for any specified
period, of any nature or kind whatsoever. Nothing in this Agreement, express or
implied, shall be deemed to confer upon any individual (or any beneficiary
thereof) any rights under or with respect to any plan, program, or arrangement
described in or contemplated by this Agreement, and
23
29
each individual (and any beneficiary thereof) shall be entitled to look only to
the express terms of any such plan, program, or arrangement for his or her
rights thereunder. Nothing in this Agreement, express or implied, shall create a
third party beneficiary relationship or otherwise confer any benefit,
entitlement, or right upon any person or entity other than the parties hereto.
Nothing in this Agreement shall cause duplicate benefits to be paid or provided
to or with respect to an employee under any employee benefit policies, plans,
arrangements, programs, practices, or agreements.
SECTION 6.5. Use of Proceeds; Bank Credit Facility. At the Closing, the
Seller (i) shall use such portion of the proceeds received by it from the sale
of the Securities as is necessary to repay in full all of its outstanding
indebtedness under the Bank Credit Facility and (ii) shall provide to the
Purchasers such evidence as they shall reasonably request to evidence that such
indebtedness has been repaid and that all liens, security interests, claims or
encumbrances on any assets of the Target Companies or the Target Subsidiaries
arising under or in connection with the Bank Credit Facility will be terminated
and released as promptly as practicable after the Closing.
SECTION 6.6. Certain Tax Proceedings. The Seller agrees to promptly
notify the Purchasers of any examination or inquiry by any federal, state or
local tax authorities of the Tax Returns of any of the corporations that are
included in the consolidated group of corporations to which the Seller belonged
for federal income tax purposes prior to the time it was converted into a
limited liability company which relates to any period prior to or including the
Closing Date. The Seller will be responsible for the conduct of any such
examination or inquiry and, if necessary, will contract with nationally
recognized tax accountants and counsel to assist it in defending the Tax Returns
for periods prior to and including the Closing Date.
ARTICLE VII
CONDITIONS TO CLOSING
SECTION 7.1. Conditions to the Obligations of Each of the Parties. The
respective obligations of the parties to consummate the Acquisition Transactions
are subject to the fulfillment, prior to or concurrently with the Closing, of
the following conditions:
24
30
(a) no statute, rule, regulation, order, writ, injunction, judgment or
decree shall have been enacted, promulgated, entered or enforced by any federal
or state court or other Governmental Authority which has the effect of making
illegal, impeding or otherwise restraining or prohibiting the consummation of
the Acquisition Transactions; and
(b) all waiting periods that are applicable to the Acquisition
Transactions under the HSR Act shall have terminated or expired.
SECTION 7.2. Conditions to the Obligations of the Purchasers. The
obligations of the Purchasers to consummate the Acquisition Transactions are
subject to the fulfillment, prior to or concurrently with the Closing, of the
following conditions:
(a) the representations and warranties of the Seller contained in this
Agreement shall be true and correct in all material respects as of the Closing
Date as if made on such date;
(b) the Seller shall have duly performed or complied in all material
respects with all of the agreements, covenants and obligations to be performed
or complied with by the Seller under the terms of this Agreement on or prior to
the Closing Date;
(c) the Seller shall have executed and delivered each of the
agreements, instruments and other documents required to be delivered by it at
the Closing pursuant to Section 3.2(a)(i) through (xii);
(d) the Seller shall have repaid all amounts owing under the Bank
Credit Facility and shall have provided satisfactory evidence that all such
amounts have been repaid and that all liens, claims or encumbrances arising
under or in respect thereof will be released and terminated as promptly as
practicable after the Closing;
(e) the Purchasers shall have received a certificate from the Seller,
dated as of the Closing Date, executed by an officer of the Seller, certifying
that the conditions set forth in paragraphs (a), (b) and (d) above have been
fulfilled; and
(f) the Purchasers shall have received an opinion, dated as of the date
hereof, of Xxxxxxx & Xxxxx L.L.P., counsel to the Seller, addressed to the
Purchasers to the effect set forth in Exhibit J hereto.
SECTION 7.3. Conditions to the Obligations of the Seller. The
obligations of the Seller to consummate the Acquisition Transactions are subject
to the fulfillment, prior to or concurrently with the Closing, of the following
conditions:
25
31
(a) the representations and warranties of the Purchasers contained in
this Agreement shall be true and correct in all material respects as of the
Closing Date as if made on such date;
(b) the Purchasers shall have duly performed or complied in all
material respects with all of the agreements, covenants and obligations to be
performed or complied with by the Purchasers under the terms of this Agreement
on or prior to the Closing Date;
(c) the Purchasers shall have executed and delivered each of the
agreements and instruments required to be delivered by them at the Closing
pursuant to Section 3.2(b)(ii) through (vi);
(d) the Seller shall have received a certificate from each of the
Purchasers, dated as of the Closing Date, executed by an officer of such
Purchaser, certifying that (in respect of such Purchaser) the conditions set
forth in paragraphs (a) and (b) above, have been fulfilled;
(e) the Seller shall have received an opinion, dated as of the date
hereof, of Xxxxx Xxxxx L.L.P., counsel to the Purchasers, addressed to the
Seller to the effect set forth in Exhibit K hereto; and
(f) Xxxxxxx & Xxxxx, L.L.P., counsel to the Seller shall have received
an opinion, dated as of the date hereof, of Xxxxx Xxxxx L.L.P., counsel to
Acquisition Sub, addressed to Xxxxxxx & Xxxxx, L.L.P., in the form previously
agreed upon by the parties, which opinion may be relied upon by Xxxxxxx & Xxxxx,
L.L.P. for purposes of delivering an opinion to the Trustee in connection with
the Acquisition Transactions as contemplated by Sections 7.4 and 8.3 of the
Senior Subordinated Note Indenture.
ARTICLE VIII
INDEMNIFICATION
SECTION 8.1. Indemnification by the Seller. In accordance with the
terms and subject to the conditions of this Article VIII, the Seller shall
indemnify and hold harmless the Purchasers (and, from and after the Closing
Effective Time, the Target Companies and Target Subsidiaries) and their
Representatives from and against any and all demands, claims, actions, causes of
action, proceedings, assessments, losses, damages, liabilities, settlements,
judgments, fines, penalties, interest, costs and expenses (including fees and
disbursements of counsel) which are asserted against, imposed upon or incurred
by any such Person as a result of or in connection with (i) the breach or
alleged breach by the Seller of any of its representations, warranties,
covenants or
26
32
agreements contained in this Agreement, (ii) the businesses and operations of
the Retained Companies, whether conducted prior to, at or after the Closing
Effective Time (except that this clause (ii) shall not operate to relieve the
Purchasers from any liabilities they may have to the Seller under the terms of
the Management Agreement or require the Seller to provide indemnification
therefor) and (iii) the debts, liabilities and obligations arising under the
Bank Credit Facility or in respect of any debt securities issued thereunder (all
such demands, claims, actions, causes of action, proceedings, assessments,
losses, damages, liabilities, settlements, judgments, fines, penalties,
interest, costs and expenses for which indemnification is provided pursuant to
this Section 8.1 being hereinafter collectively referred to as the "Purchaser
Claims"); provided, however, that (A) in the case of Purchaser Claims identified
in clause (i) above, the maximum liability of the Seller pursuant to this
Section 8.1 in respect of such Purchaser Claims shall be an amount equal to
one-quarter of the Purchase Price and (B) the obligation of the Seller to
provide indemnification pursuant to this Section 8.1 in respect of any Purchaser
Claims shall terminate as of the date of expiration of the applicable survival
period set forth in Section 8.4, unless the Purchasers shall have given notice
to Seller prior to such date identifying such the Purchaser Claims with
reasonable particularity and asserting that it is entitled to indemnification by
Seller against such Purchaser Claims pursuant to this Section 8.1.
SECTION 8.2. Indemnification by the Purchasers. In accordance with the
terms and subject to the conditions of this Article VIII, each Purchaser shall,
jointly and severally, indemnify and hold harmless the Seller and its
Representatives for, from and against any and all demands, claims, actions,
causes of action, proceedings, assessments, losses, damages, liabilities,
settlements, judgments, fines, penalties, interest, costs and expenses
(including fees and disbursements of counsel) which are asserted against,
imposed upon or incurred by any such Person as a result of or in connection with
(i) the breach or alleged breach by such Purchaser of any of their
representations, warranties, covenants or agreements contained in this Agreement
or (ii) the Businesses as conducted by the Target Companies or the Target
Subsidiaries after the Closing Effective Time (except to the extent arising from
any matter for which Purchasers are indemnified pursuant to clause (i) of
Section 8.1), (iii) the debts, liabilities and obligations arising under the
Senior Subordinated Note Indenture and any debt securities issued thereunder
(including, without limitation the Senior Subordinated Notes) (other than any
debts, liabilities or obligations the existence of which gives rise to a breach
of the provisions of Section 4.14) and (iv) the liabilities of the Target
Companies and the Target Subsidiaries that are specifically identified in
Schedule 8.2, whether existing, occurring or arising before or after the Closing
Effective Date (all such demands, claims, actions, causes of action,
proceedings, assessments, losses, damages, liabilities, settlements, judgments,
fines, penalties, interest, costs and expenses for which indemnification is
provided pursuant to this Section 8.2 being hereinafter collectively referred to
as the "Seller Claims"); provided, however, that (A) in the case of Seller
Claims identified in clause (i) above, the maximum liability of the Purchasers
27
33
pursuant to this Section 8.1 in respect of such Purchaser Claims shall be an
amount equal to one-quarter of the Purchase Price and (B) the obligation of a
Purchaser to provide indemnification pursuant to this Section 8.2 in respect of
any Seller Claims shall terminate as of the applicable survival period set forth
in Section 8.4, unless the Seller shall have given notice to such Purchaser
prior to such date identifying such Seller Claims with reasonable particularity
and asserting that it is entitled to indemnification by such Purchaser against
such Seller Claims pursuant to this Section 8.2.
SECTION 8.3. Third-Party Claims; Procedures. The obligations of the
parties provided for under Sections 8.1 and 8.2 hereof in respect of any the
Purchaser Claims, Seller Claims, as the case may be ("Claims"), made or asserted
by a third party ("Third-Party Claims") shall be performed in accordance with
the following procedures:
(a) Each Person entitled to indemnification under Section 8.1 or 8.2
(each, an "Indemnified Party") shall give the party or parties from whom it is
seeking indemnification hereunder (collectively, the "Indemnifying Party")
written notice as promptly as reasonably practicable after the written assertion
of any Third-Party Claim or commencement of any action, suit or proceeding in
respect thereof (it being understood that notice shall be deemed to have been
delivered as promptly as reasonably practicable if given no later than seven
days after the assertion of such a claim or commencement of any such action,
suit or proceeding); provided, however, that, if an Indemnified Party fails to
give Indemnifying Party written notice as provided herein, Indemnifying Party
shall only be relieved of its obligations under this Article VIII in respect of
such Third-Party Claim if and to the extent that the Indemnifying Party is
materially prejudiced thereby (whether as a result of the forfeiture of
substantive defenses or otherwise).
(b) Promptly after receipt of written notice of a Third-Party Claim as
contemplated by Section 8.3(a), the Indemnifying Party may in its sole
discretion elect to assume the defense of such Third-Party Claim with counsel
reasonably satisfactory to the Indemnified Party; provided, however, that (i) if
the Indemnifying Party fails, within a reasonable time after receipt of written
notice of such Third-Party Claim, to assume the defense thereof with counsel
reasonably satisfactory to the Indemnified Party, the Indemnified Party shall
have the right to undertake the defense, compromise and settlement of such
Third-Party Claim on behalf of and for the account and risk of the Indemnifying
Party, subject to the right of the Indemnifying Party (upon notifying the
Indemnified Party of its election to do so) to assume the defense of such
Third-Party Claim with counsel reasonably satisfactory to the Indemnified Party
at any time prior to the settlement, compromise, judgment or other final
determination thereof, (ii) if in the reasonable judgment of the Indemnified
Party a direct or indirect conflict of interest exists between the Indemnified
Party and the Indemnifying Party in respect of the Third-Party Claim that would
prohibit the assumption of the defense by the Indemnified
28
34
Party under the applicable principles of legal ethics, the Indemnified Party
shall (upon written notice to the Indemnifying Party of its election to do so)
have the right to undertake the defense, compromise and settlement of such
Third-Party Claim on behalf of and for the account and risk of the Indemnifying
Party (it being understood and agreed that the Indemnifying Party shall not be
entitled to assume the defense of such Third-Party Claim), (iii) if the
Indemnified Party in its sole discretion so elects, it shall be entitled to
employ separate counsel and to participate in the defense of such Third-Party
Claim (and the Indemnifying Party shall cooperate with the Indemnified Party so
as to allow it to participate in the defense thereof), but the fees and expenses
of counsel so employed shall (except as otherwise contemplated by clauses (i)
and (ii) above) be borne solely by the Indemnified Party and (iv) without the
prior written consent of the Indemnified Party, the Indemnifying Party shall not
settle or compromise any Third-Party Claim, or consent to the entry of any
judgment relating thereto, that does not include as an unconditional term
thereof the grant by the claimant or plaintiff to each Indemnified Party of a
release from any and all liability in respect thereof.
SECTION 8.4. Survival of Representations, Warranties or Covenants. The
representations and warranties of the parties and the rights of the parties to
indemnification in the event of a breach or alleged breach thereof shall survive
the Closing and shall continue in full force and effect until the third
anniversary of the Closing Date; provided, however, that (i) the representations
and warranties of the Seller contained in Section 4.5 shall survive indefinitely
and (ii) the representations and warranties contained in Sections 4.15, 4.16 and
4.17 shall survive until the expiration of the latest statute of limitations
applicable to Third-Party Claims that could be asserted against the Purchasers,
the Target Companies or the Target Subsidiaries based on the matters covered by
such representations and warranties. All covenants and agreements of the parties
hereto shall be continuing and shall survive the Closing Date pursuant to the
terms hereof. Notwithstanding the foregoing, the representations and warranties
of the Seller shall terminate and cease to be of any force or effect upon the
occurrence of a Change of Control Event.
SECTION 8.5. Exclusive Remedy. If the Acquisition Transaction are
consummated, the provisions of this Article VIII shall constitute the exclusive
remedy available to any party to this Agreement after the Closing Effective Time
in respect of (i) a breach by any other party of its representations and
warranties hereunder or (ii) a breach by any other party of its covenants and
agreements to be performed prior to the Closing Effective Time. This Section 8.5
shall not limit or affect any remedy that any party to this Agreement may have
in respect of a breach by the other party of its covenants and agreements to be
performed at or after the Closing Effective Time.
SECTION 8.6. Disclaimer of Other Warranties. IT IS EXPRESSLY UNDERSTOOD
AND AGREED THAT NEITHER THE SELLER NOR ANY OF THE PURCHASERS IS MAKING ANY
REPRESENTATION OR WARRANTY
29
35
WHATSOEVER, EXPRESS, IMPLIED, STATUTORY OR OTHERWISE, BEYOND THOSE
REPRESENTATIONS AND WARRANTIES EXPRESSLY GIVEN IN THIS AGREEMENT AND THE OTHER
DOCUMENTS EXECUTED AND DELIVERED BY IT IN CONNECTION WITH THE TRANSACTIONS.
WITHOUT LIMITING THE GENERALITY OF THE IMMEDIATELY PRECEDING SENTENCE, THE
SELLER HEREBY EXPRESSLY DISCLAIMS AND NEGATES ANY REPRESENTATION OR WARRANTY NOT
SET FORTH IN THIS AGREEMENT OR THE DOCUMENTS EXECUTED AND DELIVERED BY IT IN
CONNECTION WITH THE TRANSACTIONS, WHETHER IMPLIED BY COMMON LAW, BY STATUTE OR
OTHERWISE, RELATING TO THE CONDITION OF ANY OF THE ASSETS AND PROPERTIES OF THE
TARGET COMPANIES AND TARGET SUBSIDIARIES (INCLUDING ANY IMPLIED WARRANTY OF
MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR OF CONFORMITY TO MODELS
OR SAMPLES OF MATERIALS).
SECTION 8.7. Express Negligence Rule. THE INDEMNIFICATION PROVISIONS
SET FORTH IN THIS AGREEMENT, INCLUDING, WITHOUT LIMITATION, THOSE CONTAINED IN
THIS ARTICLE VIII, SHALL BE CONSTRUED TO PROVIDE INDEMNIFICATION TO THE
INDEMNIFIED PARTY FROM AND AGAINST ALL CLAIMS DESCRIBED THEREIN, WHICH CLAIMS
INCLUDE, WITHOUT LIMITATION, CLAIMS ARISING FROM THE SOLE, JOINT AND/OR
COMPARATIVE NEGLIGENCE, STRICT LIABILITY OR FAULT OF THE OTHER PARTY, IF ANY.
THE PURCHASERS AND THE SELLER ACKNOWLEDGE AND AGREE THAT THIS AGREEMENT AND THIS
PROVISION COMPLY IN ALL RESPECTS WITH THE EXPRESS NEGLIGENCE RULE, AND THAT THIS
PROVISION IS CONSPICUOUS.
SECTION 8.8. Damages. NOTWITHSTANDING ANYTHING HEREIN TO THE CONTRARY,
IN NO EVENT SHALL A PARTY BE REQUIRED TO INDEMNIFY ANY INDEMNIFIED PARTY FOR ANY
SPECIAL, EXEMPLARY OR PUNITIVE DAMAGES SUFFERED OR INCURRED BY THE INDEMNIFIED
PARTY AS A RESULT OF A BREACH OF THE PROVISIONS OF THIS AGREEMENT OR ANY OF THE
DOCUMENTS EXECUTED BY THE PARTIES HERETO IN CONNECTION WITH THE CLOSING,
INCLUDING ANY SUCH DAMAGES AND CLAIMS ARISING OUT OF THE SOLE, JOINT, AND/OR
COMPARATIVE NEGLIGENCE, STRICT LIABILITY OR FAULT OF SUCH PARTY.
30
36
ARTICLE IX
TERMINATION
SECTION 9.1. Termination. At any time prior to the Closing, this
Agreement may be terminated: (a) by mutual written consent of the parties
hereto; or (b) by any of the parties if a federal or state court or other
Governmental Authority shall have issued an order, writ, injunction, judgment or
decree which shall have the effect of making illegal, impeding or otherwise
restraining or prohibiting any of the transactions contemplated by this
Agreement and such order, writ, injunction, judgment or decree shall have become
final and nonappealable.
SECTION 9.2. Effect of Termination. In the event of the termination of
this Agreement in accordance with Section 9.1, this Agreement shall forthwith
become void and of no further force or effect, and there shall be no liability
hereunder on the part of any party or its Affiliates, directors, officers,
shareholders, agents or other representatives; provided, however, that (i) this
Section 9.2 and Sections 11.1, 11.2, 11.3, 11.4, 11.5, 11.6 and 11.9 shall
survive any termination of this Agreement and (ii) nothing contained herein
shall relieve any party from liability for any breach occurring prior to the
date of the termination of this Agreement.
ARTICLE X
DEFINITIONS
SECTION 10.1. Definitions.
(a) As used herein, the terms set forth below shall have the following
respective meanings:
"Affiliate" shall mean, as of the applicable date, with respect to any
Person, any other Person who, directly or indirectly, is in control of, is
controlled by, or is under common control with, such Person. As used in this
definition, the term "control" means the possession, directly or indirectly, of
the power to direct or cause the direction of the management or policies of a
Person, whether by contract or otherwise.
"Agreement" shall mean this Agreement, as the same may be amended from
time to time.
31
37
"Assumption Agreement" shall mean an agreement, dated as of the Closing
Date, to be entered into among Premier, the Seller and Acquisition Sub pursuant
to which Premier and Seller shall assign to Acquisition Sub, and Acquisition Sub
shall assume, the obligations of Premier and Seller under Sections 5.4 and 5.6
of the Premier/Republic Merger Agreement, in the form attached as Exhibit D.
"Bank Credit Facility" shall mean that certain Credit Agreement, dated
as of July 15, 1998, among the Seller, the banks party thereto and Bank of
America, N.A., as Administrative Agent, as amended.
"Businesses" shall mean the businesses and operations conducted by the
Target Companies and the Target Subsidiaries (other than any businesses
transferred to the Seller in connection with the Preacquisition Transactions).
"Bylaws" shall mean, with respect to any corporation, the bylaws of
such corporation, as in effect on the Closing.
"Change of Control Event" shall mean any event or transaction (or
series of events or transactions) as a result of which (i) Acquisition Sub
ceases to be a direct or indirect Subsidiary of CXP, (ii) (a) Centex Corporation
ceases to be the beneficial owner (as defined for purposes of this definition in
a manner consistent with the definition of the term "beneficial ownership" in
Rule 13d-3 under the Exchange Act) of more than 50% of the combined voting power
of the voting securities of CXP and (b) any Person (including for purposes of
this definition any "group" within the meaning of Rule 13d-5 under the Exchange
Act) other than Centex Corporation or its Affiliates becomes the beneficial
owner (as defined in the manner described above) of a greater percentage of the
combined voting power of the voting securities of CXP than Centex Corporation or
(iii) Acquisition Sub or CXP is adjudged to be insolvent or files for protection
under any provision of bankruptcy law (it being understood that in the event
Acquisition Sub or CXP is adjudged to insolvent, the Change of Control Event
shall be deemed to have occurred when Acquisition Sub or CXP became insolvent
rather than when it was adjudged to be so).
"Charter" shall mean, with respect to any corporation, the certificate
or articles of incorporation (or similar governing document) of such
corporation, as in effect on the Closing.
"Closing Date" shall mean the date upon which the Closing is held in
accordance with Article III.
"Delaware General Corporation Law" shall mean the Delaware General
Corporation Law, as from time to time amended and including any successor
statute of similar import.
32
38
"Delaware Limited Liability Company Act" shall mean the Delaware
Limited Liability Company Act, as from time to time amended and including any
successor statute of similar import.
"ERISA" shall mean the Employee Retirement Income Security Act of 1974,
as amended.
"ERISA Affiliate" shall mean, with respect to Seller, any corporation
or other trade or business under common control with Seller (within the meaning
of Section 414 (b) and (c) of the Internal Revenue Code or Section 4001(a)(14)
or 4001(b) of ERISA).
"Exchange Act" shall mean the Securities Xxxxxxxx Xxx 0000, as amended
(including any successor statute).
"GAAP" shall mean United States generally accepted accounting
principles as in effect at the time of application thereof in accordance with
the provisions of this Agreement.
"Governmental Authority" shall mean any nation or government, any state
or political subdivision thereof, any federal or state court and any other
agency or authority exercising executive, legislative, judicial, regulatory or
administrative functions of or pertaining to government.
"Guaranties" shall mean (i) the Guaranty, dated as of the Closing Date,
executed by HM in favor of RPC in order to guaranty the payment of the principal
of and interest on the Excluded Subsidiary Promissory Note and (ii) the
Guaranty, dated as of the Closing Date, executed by RPCWV in favor of RPC in
order to guaranty the payment of the principal of and interest on the Excluded
Subsidiary Promissory Note, in the respective forms attached hereto as Exhibit
G.
"HSR Act" shall mean Section 7A of the Xxxxxxx Act (Title II of the
Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of 1976), as amended (including any
successor statute).
"Intellectual Property Rights" shall mean all (i) patents, patent
applications, patent disclosures and inventions, (ii) trademarks, service marks,
trade dress, trade names, logos and corporate names and registrations and
applications for registration thereof, (iii) copyrights (registered and
unregistered) and copyrightable works and registrations and applications for
registration thereof, (iv) computer software, data, data bases and documentation
thereof, (v) trade secrets and other confidential information (including, but
not limited to, ideas, formulas, compositions, inventions (whether patentable or
unpatentable and whether or not reduced to practice), know-how, manufacturing
and production processes and techniques, research and development information,
drawings, specifications, designs, plans, proposals, technical data,
33
39
copyrightable works, financial and marketing plans and customer and supplier
lists and information) and (vi) other intellectual property rights.
"Internal Revenue Code" shall mean the Internal Revenue Code of 1986,
as the same may be amended from time to time, and any successor statute thereto.
"Limited Liability Company Agreement" shall mean, with respect to any
limited liability company, the limited liability company agreement (or similar
governing document) of such limited liability company.
"Management Agreement" shall mean the Management Agreement, dated as of
the Closing Date, to be entered into among Acquisition Sub, the Seller, HM and
RPCWV, in the form attached as Exhibit F.
"Material Adverse Change" shall mean, when used with respect to a party
to this Agreement or any other Person, an actual or prospective material adverse
change in the business, operations, affairs, condition (financial or otherwise),
results of operation, properties, assets or liabilities of such party or Person.
"Material Adverse Effect" shall mean, when used with respect to a party
to this Agreement or any other Person, an actual or prospective material adverse
effect on the business, operations, affairs, condition (financial or otherwise),
results of operation, properties, assets or liabilities of such party or Person.
"Partnership Agreement" shall mean, with respect to any partnership,
the partnership agreement of such partnership, as in effect on the Closing.
"Person" shall mean any individual, corporation, partnership, limited
liability company, association, trust or any other entity or organization of any
kind or character, including a Governmental Authority.
"Representative" shall mean, with respect to a Person, the Affiliates
of such Person, and its and their respective stockholders, partners, members,
officers, directors, employees, agents and representatives.
"Republic Group Companies" shall mean (i) Republic Gypsum Company, a
Delaware corporation, including for all periods prior to the consummation of the
Reincorporation Transactions its predecessor, Republic Gypsum Company, an
Oklahoma corporation, (ii) Republic Paperboard Company, a Delaware corporation,
including for all periods prior to the consummation of the Reincorporation
Transactions its predecessor, Republic Paperboard Company, a Kansas corporation,
(iii) LaPorte Minerals Corporation, a Delaware corporation, including for all
periods prior to the consummation of the Reincorporation Transactions its
predecessor, LaPorte Minerals Corporation, an Indiana corporation, (iv) Xxxxxx &
Eastern Railroad Company, a
34
40
Delaware corporation, including for all periods prior to the consummation of the
Reincorporation Transactions its predecessor, Xxxxxx & Eastern Railroad Company,
an Oklahoma corporation, (v) Republic Fiber Company, a Delaware corporation,
including for all periods prior to the consummation of the Reincorporation
Transactions its predecessor, Republic Fiber Company, a Kansas corporation, (vi)
Republic Paperboard Company of West Virginia, a Delaware corporation, including
for all periods prior to the consummation of the Reincorporation Transactions
its predecessor, Republic Paperboard Company of West Virginia, a West Virginia
corporation, and (vii) Resource Control, Inc. Merger Subsidiary, a Delaware
corporation, including for all periods prior to the consummation of the
Reincorporation Transactions its predecessor, Resource Control, Inc., a Kansas
corporation. The term "Republic Group Companies" shall also include for all
periods after the consummation of the Preacquisition Transactions the successors
to the aforementioned companies resulting from such transactions.
"Retained Companies" shall mean all of the Republic Group Companies
other than the Target Companies and the Target Subsidiaries.
"Securities Act" shall mean the Securities Xxx 0000, as amended
(including any successor statute).
"Security Documents" shall mean (i) the Pledge and Security Agreement,
dated as of the Closing Date, between the Seller and RPC, (ii) the Security
Agreement, dated as of the Closing Date, between HM and RPC, (iii) the Security
Agreement, dated as of the Closing Date, between RPCWV and RPC, (iv) the
Mortgage and Security Agreement, dated as of the Closing Date, executed by HM in
favor of RPC and (v) the Deed of Trust, dated as of the Closing Date, executed
by RPCWV in favor of RPC, which documents secure the obligations of the Seller
in respect of the Excluded Subsidiary Sale Promissory Note or the obligation of
HM or RPCWV in respect of the Guaranties, as the case may be, in the respective
forms attached hereto as Exhibit H.
"Senior Subordinated Note Indenture" shall mean the Indenture, dated as
of July 15, 1998, between the Seller and the Trustee.
"Senior Subordinated Notes" shall mean the Senior Subordinated Notes
due 2008 in the aggregate principal amount of $100,000,000 issued under the
Senior Subordinated Note Indenture.
"Subsidiary" shall mean, with respect to any Person, (i) any
corporation or other entity of which securities or other ownership interests
having ordinary voting power to elect a majority of the board of directors or
other persons performing similar functions are owned directly or indirectly
(whether through one or more Subsidiaries or otherwise) by such Person or (ii)
any partnership, limited liability company or other unincorporated entity of
which such Person or any of its Subsidiaries is a general partner or manager or
of which such Person directly or indirectly (whether through one
35
41
or more Subsidiaries or otherwise) owns partnership interests, limited liability
company interests or other similar ownership interests which entitle it to
receive more than 50% of the distributions made by such partnership, limited
liability company or other entity.
"Supplemental Indenture" shall mean the supplemental indenture, to be
dated as of the Closing Date, to be entered into between the Seller, Acquisition
Sub and the Trustee in connection with the Acquisition Transactions as
contemplated by Section 8.01 of the Senior Subordinated Note Indenture in order
to evidence the assumption by Acquisition Sub of all of the obligations of the
Seller under the Senior Subordinated Notes and the Senior Subordinated Note
Indenture, in the form attached as Exhibit I.
"Tax Returns" shall mean any federal, state and local returns,
declarations, reports, claims for refund and informational returns or statements
(including statements and filings relating to employee benefit plans) relating
to Taxes, including any schedules or attachments thereto.
"Taxes" shall mean all taxes, charges, fees, levies or other
assessments (including, but not limited to, income, gross receipts, excise,
property, sales, occupation, use, service, service use, license, payroll,
franchise, transfer and recording taxes, fees and charges) imposed by any
Governmental Authority, whether computed on a separate, consolidated, unitary or
combined basis or in any other manner, and includes any interest, penalties and
additions to any Tax.
"Trademark Assignments" shall mean (i) the Trademark Assignment, dated
as of the Closing Date, to be executed by the Seller in favor of RGC and (ii)
the Trademark Assignment, dated as of the Closing Date, to be executed by the
Seller in favor of RFC, in the respective forms attached as Exhibit C.
"Transactions" shall mean the transactions contemplated by this
Agreement, including, but not limited to, the Preacquisition Transactions and
Acquisition Transactions.
"Transition Services Agreement" shall mean the Transition Services
Agreement, dated as of the Closing Date, to be entered into between the Seller
and Acquisition Sub, in the form attached as Exhibit E.
"Trustee" shall mean UMB Bank, N.A., as trustee under the Subordinated
Note Indenture.
"WARN Act" shall mean the Worker Adjustment and Retraining Notification
Act, as amended, and any successor statute thereto.
(b) Each of the terms set forth below has the meaning specified in the
provision set forth opposite such term in the following table:
36
42
TERM PROVISION
---- ---------
Accession Agreements Section 2.2
Acquisition Sub Introductory Paragraph
Acquisition Transactions Section 2.5
Assignments Section 2.2
CXP Introductory paragraph
Claims Section 8.3
Closing Section 3.1
Closing Effective Time Section 2.1
Commonly Controlled Entity Section 4.18(a)
Conversion Transactions Section 1.1
Default Section 4.14
Environmental Claims Section 4.16
Environmental Laws Section 4.16
Event of Default Section 4.14
Excluded Subsidiary Sale Section 1.2
Excluded Subsidiary Sale Promissory Note Section 1.2
Financial Statements Section 4.8
H&ERR Recitals
H&ERR Merger Section 1.1
HM Section 1.2
Hutchinson Contribution Section 1.2
Indemnified Party Section 8.3(a)
Indemnifying Party Section 8.3(a)
LPMC Recitals
Leased Property Section 4.15(b)
Owned Property Section 4.15(b)
Pension Plan Section 4.18(a)
Permitted Liens Section 4.15(a)
Preacquisition Transactions Section 1.3
Premier Recitals
Premier Partners Recitals
Premier/Republic Merger Recitals
Premier/Republic Merger Agreement Recitals
Purchase Price Section 2.3
Purchaser Claims Section 8.1
Purchasers Introductory paragraph
RCI Recitals
RFC Recitals
RGC Recitals
XXXX Xxxxxxxx
00
00
XXXX XXXXXXXXX
---- ---------
RGCO Recitals
RPC Recitals
RPCWV Recitals
Reincorporation Transactions Section 1.1
Securities Recitals
Seller Benefit Plans Section 4.18(a)
Seller Claims Section 8.2
Seller Plans Section 4.18(h)
Seller Introductory paragraph
Target Companies Recitals
Target Property Section 4.15(b)
Target Subsidiaries Recitals
Third-Party Claims Section 8.3
WARN Obligations Section 6.4(g)
Welfare Plan Section 4.18(a)
ARTICLE XI
MISCELLANEOUS
SECTION 11.1. Fees and Expenses. Except as expressly provided herein,
all fees and expenses incurred by any of the parties hereto in connection with
this Agreement or any of the transactions contemplated hereby or thereby shall
be borne and paid solely by the party incurring such fees and expenses.
SECTION 11.2. Notices. All notices, requests, claims, demands and other
communications hereunder shall be in writing and shall be given (i) by delivery
in person, (ii) by registered or certified mail (return receipt requested and
with postage prepaid thereon), (iii) by overnight mail or courier service or
(iv) by facsimile transmission to the parties at the following addresses (or at
such other address as any party shall have furnished to the others in accordance
with the terms of this Section 11.2):
if to the Purchasers:
Centex Construction Products, Inc.
0000 Xxxxx Xxxxxxx
Xxxxxx, Xxxxx 00000
Facsimile: (000) 000-0000
Attention: President and Chief Executive Officer
38
44
with a copy to:
Xxxxx Xxxxx L.L.P.
0000 Xxxx Xxxxxx
Xxxxxx, Xxxxx 00000
Facsimile: (000) 000-0000
Attention: Xxxxxxxx X. Xxxxxx
If to the Seller:
Republic Group LLC
X.X. Xxx 0000
Xxxxxxxxxx, Xxxxxx 00000
Facsimile: (000) 000-0000
Attention: President
with a copy to:
Xxxxxxx & Xxxxx L.L.P.
0000 Xxxxx Xxxxx
Xxxxxxx, Xxxxx 00000
Facsimile: (000) 000-0000
Attention: Xxxx X. Xxxxxxxx
All notices, requests, claims, demands and other communications hereunder that
are addressed as provided in or pursuant to this Section 11.2 shall be deemed
duly and validly given (a) if delivered in person, upon delivery, (b) if
delivered by registered or certified mail (return receipt requested and with
postage paid thereon), 72 hours after being placed in a depository of the United
States mails, (c) if delivered by overnight mail or courier service, upon
delivery, and (d) if delivered by facsimile transmission, upon transmission
thereof and receipt of the appropriate electronic confirmation.
SECTION 11.3. Amendment; Waivers. The terms and provisions of this
Agreement may be modified or amended only by a written instrument executed by
each of the parties hereto, and compliance with any term or provision hereof may
be waived only by a written instrument executed by each party entitled to the
benefits of the same. Except as expressly provided herein to the contrary, no
failure to exercise any right, power or privilege hereunder shall operate as a
waiver thereof, nor shall any single or partial exercise thereof preclude any
other or further exercise thereof or the exercise of any other right, power or
privilege granted hereunder.
SECTION 11.4. Entire Agreement. This Agreement (including the Exhibits
and Schedules hereto and the certificates, opinions and documents delivered in
accordance with the provisions hereof) constitutes the entire agreement among
the
39
45
parties with respect to the subject matter hereof and supersedes all prior
agreements and understandings, whether written or oral, between the parties with
respect to the subject matter hereof. All Exhibits and Schedules hereto and
certificates, opinions and other documents delivered in accordance with the
provisions hereof are expressly made a part of this Agreement.
SECTION 11.5. Parties in Interest; Assignment. This Agreement shall be
binding upon and inure to the benefit of the parties hereto and their respective
successors and assigns (it being understood and agreed that, except as expressly
provided herein, nothing contained in this Agreement is intended to confer upon
any other Person any rights, benefits or remedies of any kind or character
whatsoever under or by reason of this Agreement). No party may assign this
Agreement, directly or indirectly, collaterally or otherwise, without the prior
written consent of each of the other parties hereto, which consent may be
granted or withheld in the sole discretion of each such other party; provided,
however, that a Purchaser may assign this Agreement or its rights hereunder to
any wholly owned Subsidiary of the Purchasers without the consent of any other
party (it being understood and agreed that, if the assignee ceases to be a
wholly owned Subsidiary of the Purchasers after the date of the assignment, such
event shall be treated as an unauthorized assignment by the applicable Purchaser
for purposes of this Section 11.5). It is expressly understood and agreed that
any attempted or purported assignment by any party of this Agreement in
violation of this Section 11.5 shall be null and void.
SECTION 11.6. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of Texas, without regard to
the principles of conflicts of law that would result in the application of the
laws of any other jurisdiction.
SECTION 11.7. Severability. In the event any provision contained herein
shall be held to be invalid, illegal or unenforceable for any reason, the
invalidity, illegality or unenforceability thereof shall not affect any other
provision hereof.
SECTION 11.8. Specific Performance. The parties hereto agree that
irreparable damage would occur in the event that any of the provisions of this
Agreement were not performed in accordance with the terms hereof. Accordingly,
the parties agree that each of them shall be entitled to seek injunctive relief
to prevent breaches of the terms of this Agreement and to seek specific
performance of the terms hereof and thereof, in addition to any other remedy now
or hereafter available at law or in equity, or otherwise.
SECTION 11.9. Public Announcements. The Seller and the Purchasers shall
consult with each other before issuing any press release or otherwise making any
public statements with respect to this Agreement or the transactions
contemplated hereby, and shall not issue any such press release or make any such
public statement without the
40
46
prior written consent of each of the other parties, except as may be required by
law or pursuant to any listing agreement, rule or regulation of any national
securities exchange or automated quotation system upon which the securities of
such party are traded.
SECTION 11.10. Headings. The headings herein are for convenience of
reference only, do not constitute a part of this Agreement and shall not be
deemed to limit, extend or otherwise affect the meaning of any of the provisions
hereof.
SECTION 11.11. Counterparts. This Agreement may be executed in one or
more counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
41
47
IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed as of the date first above written.
REPUBLIC GROUP LLC
By: /s/ XXXXX X. XXXXXX
--------------------------------------
Name: Xxxxx X. Xxxxxx
------------------------------------
Title: President
-----------------------------------
CENTEX CONSTRUCTION
PRODUCTS, INC.
By: /s/ XXXXXX X. XXXXXX, XX.
--------------------------------------
Name: Xxxxxx X. Xxxxxx, Xx.
------------------------------------
Title: Senior Vice President-Finance
and Treasurer
-----------------------------------
REPUBLIC HOLDING
CORPORATION
By: /s/ XXXXXX X. XXXXXX, XX.
--------------------------------------
Name: Xxxxxx X. Xxxxxx, Xx.
------------------------------------
Title: Senior Vice President-Finance
and Treasurer
-----------------------------------
