EXHIBIT 10.1
Execution Copy
PURCHASE PRICE ADJUSTMENT SETTLEMENT AGREEMENT AND UNCONDITIONAL MUTUAL RELEASE
This Purchase Price Adjustment Settlement Agreement and
Unconditional Mutual Release (this "Agreement") is entered as of
February 12, 2003 by and among MILACRON INC., a Delaware corporation
("Parent"), Milacron B.V., a company organized under the laws of the
Netherlands ("Milacron B.V." and together with Parent, "Seller") and
Kennametal Inc., a Pennsylvania corporation ("Purchaser"). Terms used
but not defined herein shall have the meanings assigned to them in the
Stock Purchase Agreement dated as of May 3, 2002 between Seller and
Purchaser (the "Stock Purchase Agreement").
WHEREAS, Parent, Milacron B.V. and Purchaser are parties to the Stock
Purchase Agreement pursuant to which Purchaser purchased all the outstanding
ordinary shares of Milacron Metalworking Technologies GmbH, Widia Netherland
B.V., Milacron Iberica S.L., Milacron U.K. Ltd., Milacron France SAS and Widia
Italia S.r.l., on August 30, 2002 (the "Closing Date") for the Purchase Price of
E188,282,202;
WHEREAS, Section 1.04(c) of the Stock Purchase Agreement provides that
the Purchase Price shall be increased by the amount by which Closing Net Assets
exceed E126,865,000 (the "Reference Net Assets"), and the Purchase Price shall
be decreased by the amount by which Closing Net Assets are less than the
Reference Net Assets; and
WHEREAS, on October 29, 2002, pursuant to Section 1.04(a) of the Stock
Purchase Agreement, Seller delivered to Purchaser the Statement setting forth
Closing Net Assets; and on November 25, 2002, pursuant to Section 1.04(b) of the
Stock Purchase Agreement, Purchaser delivered to Seller a Notice of Objection to
Seller's computation of Closing Net Assets.
NOW, THEREFORE, for and in consideration of the mutual promises and
undertakings set forth below, and intending to be legally bound hereby, Seller
and Purchaser hereby agree as follows:
1. Purchase Price Adjustment.
(a) In full and final settlement of all Purchaser's objections set
forth in Purchaser's Notice of Objections, Seller and Purchaser hereby agree
that (i) Closing Net Assets are equal to E107,884,000 and that such
determination is final and binding, (ii) the Reference Net Assets exceed the
Closing Net Assets by the amount of E18,981,000 (the "Adjustment Amount") and
(iii) the Adjusted Purchase Price shall be equal to E169,301,202 in accordance
with Section 1.04(c) of the Stock Purchase Agreement. In accordance with the
terms of the Stock Purchase Agreement, Seller is obligated to pay to Purchaser
as a purchase price adjustment an amount equal to the Adjustment Amount together
with E281,551.50, representing interest thereon at a rate equal 3% per annum,
from the Closing Date to the Payment Date (as defined below).
The Adjustment Amount and interest thereon are sometimes hereinafter referred to
as the "Purchase Price Adjustment Amount".
(b) Purchaser and Seller agree that Purchaser is obligated to pay to
Seller an amount equal to E400,820 (the "Intercompany Receivables Amount"),
representing the net amount of the obligations that Purchaser and Seller are
obligated to settle pursuant to Section 5.20(b) of the Stock Purchase Agreement,
the calculation of which is set forth on Exhibit A hereto.
(c) In satisfaction of the amounts owed by Seller and Purchaser set
forth in paragraphs (a) and (b) of this Section, Seller shall pay to Purchaser
an amount of E18,861,731.50 (the "Net Payment Amount"), equal to (i) the
Purchase Price Adjustment Amount, minus (ii) the Intercompany Receivables
Amount.
2. Payment to Purchaser. Seller shall pay to Purchaser the Net Payment
Amount by wire transfer of immediately available funds to the following account:
Bene: X.X. Xxxxxx Europe Limited, London (XXXXXX00)
Bank: X.X. Xxxxxx AG, Frankfurt
Swift: XXXXXXXX
Acct#: 6001600037
Ref: Milacron payment to Kennametal Inc.
Seller shall pay the Net Payment Amount no later than February 24, 2003 (the
date of such payment, the "Payment Date").
3. Mutual Release of Claims.
(a) Effective immediately upon payment of the Net Payment Amount,
(i) Each of Seller and Purchaser agrees that payment of the Net Payment Amount
by Seller shall constitute full and final satisfaction of all of Seller's and
Purchaser's obligations under Section 1.04(c) of the Stock Purchase Agreement,
and (ii) each of Seller and Purchaser agrees that neither Seller nor Purchaser
shall have any further rights or obligations under Section 1.04(c) of the Stock
Purchase Agreement. Purchaser and Seller expressly ratify and confirm the
provisions of the final sentence of Section 1.04(b)(2) of the Stock Purchase
Agreement, and Purchaser agrees that it will not make any claim against Seller
in respect of any post-Closing Purchase Price adjustment.
(b) Effective immediately upon payment of the Net Payment Amount,
(i) each of Seller and Purchaser agrees that payment of the Net Payment Amount
by Seller shall constitute full and final satisfaction of all of Seller's and
Purchaser's obligations under Section 5.20(b) of the Stock Purchase Agreement,
and (ii) each of Seller and Purchaser agrees that neither Seller nor Purchaser
shall have any further rights or obligations under Section 5.20(b) of the Stock
Purchase Agreement.
(c) Effective immediately upon payment of the Net Payment Amount,
Purchaser hereby unconditionally releases Seller and its affiliates, successors
and assigns and each of their respective officers, directors, employees,
stockholders, agents and
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representatives (collectively, the "Seller Parties") from all actions, causes of
action, suits, debts, dues, sums of money, accounts, reckonings, covenants,
contracts, agreements, promises, damages, claims and demands whatsoever with
respect to any matter that Purchaser raised in the Notice of Objection.
Purchaser agrees that it will not assert or pursue any claim (including any
claim under the Stock Purchase Agreement) against any Seller Party with respect
to any matter that Purchaser raised in the Notice of Objection.
(d) Effective immediately upon payment of the Net Payment Amount,
Seller acknowledges and agrees that payment of the Net Payment Amount to
Purchaser under this Agreement does not result in any Loss to any Seller
Indemnitee under the Stock Purchase Agreement.
4. Obligations to Xxxx Xxxxxxx. Effective immediately upon payment of
the Net Payment Amount, Purchaser agrees (a) that Seller shall have no liability
for any obligation of any Seller Entity, Acquired Company or any subsidiary
thereof (together, the "Preclosing Seller Entities") to Xxxx Xxxxxxx arising
under the employment letter dated December 5, 2000, between Xxxx Xxxxxxx and
Parent (the "Employment Letter") and (b) that Purchaser shall indemnify and hold
harmless the Seller Parties for all liability for all obligations to Xxxx
Xxxxxxx arising under the Employment Letter, in each case other than obligations
of Preclosing Seller Entities to Xxxx Xxxxxxx for compensation earned prior to
the Closing Date.
5. Purchaser's Representation and Warranty. Purchaser hereby represents
and warrants to Seller that, except as set forth on Schedule 5, to Purchaser's
Actual Knowledge there exist no facts, conditions or circumstances that,
individually or in the aggregate, could reasonably be expected to form the basis
of a claim against any Seller Party by any Purchaser Indemnitee under the Stock
Purchase Agreement. For purposes of the previous sentence "Actual Knowledge"
means the actual knowledge of Xxxxxxx X. Xxxxxxx, Xxxxxxx X. Xxxx, Xxxxx X.
Xxxxxxxxxx or Xxxxx Xxxxx. Purchaser and Seller acknowledge and agree that the
inclusion of any matter on Schedule 5 shall not constitute an agreement on the
part of Seller that such matter does, or is of the type that could, give rise to
a valid claim under the Stock Purchase Agreement or a waiver of the Seller's
right to dispute any claim made in respect of such matter.
6. Entire Agreement. This Agreement, including the Exhibit hereto and
the Schedule hereto, constitutes the entire agreement among the parties with
respect to the subject matter hereof and thereof and supersedes any previous
agreements and understandings between the parties with respect to such matters.
Except as expressly set forth herein and therein, the Stock Purchase Agreement
is hereby ratified and confirmed in all respects.
7. Section Headings. The descriptive headings of the several sections
of this Agreement are inserted for convenience only, do not constitute a part of
this Agreement and shall not affect in any way the meaning or interpretation of
this Agreement.
8. Incorporation by Reference. The recitals to this Agreement are
hereby incorporated by reference.
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9. Governing Law. This Agreement and any disputes arising under or
related thereto (whether for breach of contract, tortious conduct or otherwise)
shall be governed by and construed in accordance with the laws of the State of
New York, without reference to its conflicts of laws principles.
10. Counterparts. This Agreement may be executed in one or more
counterparts, all of which shall be considered one and the same agreement, and
shall become effective when one or more counterparts have been signed by each of
the parties hereto and delivered, in person or by telecopier, receipt
acknowledged, to the other parties hereto.
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IN WITNESS WHEREOF, the parties, hereunto duly authorized and having
all necessary power and capacity therefor, have executed this Agreement as of
the date first above written.
MILACRON INC.
By: /s/ Xxxxxx X. Xxxxx
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Name: Xxxxxx X. Xxxxx
Title: Chairman and Chief Executive Officer
MILACRON B.V.
By: /s/ Xxxxxx xxx Xxxxxxxx
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Name: Xxxxxx xxx Xxxxxxxx
Title: Managing Director
KENNAMETAL INC.
By: /s/ Xxxxx X. Xxxxxxxxxx
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Name: Xxxxx X. Xxxxxxxxxx
Title: Vice President, Secretary and General Counsel
