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PURCHASE AGREEMENT
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dated as of June 1, 1998
by and among
XXXXXXXX SOUP COMPANY,
SILGAN CAN COMPANY
and
SILGAN CONTAINERS CORPORATION
TABLE OF CONTENTS
Page
ARTICLE I DEFINITIONS.....................................................2
1.1 Certain Defined Terms..................................2
ARTICLE II TRANSFER TO SUBSIDIARY; PURCHASE AND SALE......................9
2.1 Transfer of Xxxxxxxx Assets to Subsidiary..............9
2.2 Excluded Assets.......................................12
2.3 Assignment of Assumed Liabilities.....................12
2.4 Transfer of Shares....................................13
2.5 Consent of Third Parties..............................14
2.6 Effective Time........................................14
2.7 Merger................................................15
2.8 Supply Agreement......................................15
ARTICLE III PURCHASE PRICE...............................................15
3.1 Purchase Price........................................15
3.2 Physical Count of Inventory...........................18
3.3 Allocation............................................19
ARTICLE IV CLOSING ......................................................19
ARTICLE V REPRESENTATIONS AND WARRANTIES OF XXXXXXXX.....................20
5.1 Organization of Xxxxxxxx and Subsidiary...............20
5.2 Corporate Authorization; No Violation.................20
5.3 Compliance with Law...................................21
5.4 Subsidiary. (a)......................................22
5.5 Statement of Cost.....................................23
5.6 Xxxxxxxx Assets.......................................23
5.7 Operating and Trade Contracts and Agreements..........24
5.8 Personnel Contracts and Collective Bargaining
Agreements; Labor Relations.......................24
5.9 Employee Benefit Plans................................26
5.10 Environmental Matters.................................27
5.11 Litigation............................................28
5.12 Taxes.................................................29
5.13 Intellectual Property.................................29
5.14 Consents..............................................30
5.15 Absence of Certain Changes and Undisclosed Liabilities30
5.16 Effect of Agreements..................................31
5.17 Xxxxxxxx Fiscal 1998 Can Manufacturing Plan...........31
5.18 Compensation..........................................32
ARTICLE VI REPRESENTATIONS AND WARRANTIES OF PURCHASER AND SILGAN........32
6.1 Organization of Purchaser.............................32
6.2 Corporate Authorization; No Violation.................33
6.3 Litigation............................................34
6.4 Consents..............................................34
6.5 Investment Intent.....................................34
6.6 Multiemployer Plan Obligations........................35
ARTICLE VII COVENANTS AND AGREEMENTS.....................................35
7.1 Best Efforts..........................................35
7.2 Accounting Matters....................................35
7.3 Taxes.................................................36
7.4 Signage...............................................38
7.5 Post-Closing by Purchaser.............................38
7.6 Post-Closing by Xxxxxxxx..............................39
7.7 Elaboration...........................................39
7.8 Environmental Matters.................................40
7.9 Multiemployer Plan Obligations........................40
ARTICLE VIII COVENANTS AND REPRESENTATIONS RELATING TO PERSONNEL
ARRANGEMENTS................................................43
8.1 Continued Employees; Labor Supply Agreement...........43
8.2 Employee Benefits.....................................44
8.3 Restrictions on Hiring................................48
ARTICLE IX CLOSING DOCUMENTS TO BE DELIVERED BY XXXXXXXX.................48
9.1 Opinion of Counsel....................................48
9.2 Certificates for Shares...............................48
9.3 Consents..............................................49
9.4 Secretary's Certificate...............................49
9.5 Further Instruments...................................50
9.6 Supply Agreement......................................50
9.7 Leases................................................50
9.8 Labor Supply Agreement................................50
9.9 Shared Services Agreement.............................50
9.10 Pledge and Rights Agreement...........................50
9.11 Wastewater Services Agreement.........................50
ARTICLE X CLOSING DOCUMENTS TO BE DELIVERED BY PURCHASER.................51
10.1 Opinion of Counsel....................................51
10.2 Purchase Price........................................51
10.3 Consents..............................................51
10.4 Secretary's Certificate...............................51
10.5 Further Instruments...................................52
10.6 Supply Agreement......................................52
10.7 Leases................................................52
10.8 Labor Supply Agreement................................52
10.9 Shared Services Agreement.............................52
10.10 Pledge and Rights Agreement...........................52
10.11 Guaranty..............................................52
10.12 Wastewater Services Agreement.........................53
10.13 Letter of Credit......................................53
ARTICLE XI INDEMNIFICATION...............................................53
11.1 By Xxxxxxxx...........................................53
11.2 By Purchaser and Silgan...............................57
11.3 Defense...............................................61
11.4 Taxes.................................................63
11.5 Certain Other Limitations.............................64
11.6 Reduction of Indemnification..........................73
ARTICLE XII BROKERAGE AND FINDERS' FEES..................................74
ARTICLE XIII MISCELLANEOUS...............................................75
13.1 Expenses; Prorations..................................75
13.2 Risk of Loss..........................................75
13.3 Further Assurances....................................76
13.4 Survival..............................................76
13.5 Applicable Law........................................77
13.6 Attorneys' Fees.......................................77
13.7 Notices...............................................77
13.8 Headings And Context..................................78
13.9 Counterparts..........................................78
13.10 Benefits..............................................78
13.11 Amendment and Waiver..................................79
13.12 Entire Agreement......................................79
13.13 Limitation on Seller's Representations................79
13.14 Bulk Transfer Laws....................................81
13.15 Campbell's Knowledge..................................81
13.16 Construction; Interpretation..........................82
13.17 Limitations on Disclosure of Information..............82
PURCHASE AGREEMENT
THIS PURCHASE AGREEMENT (this "Agreement") is made and entered into as of
June 1, 1998, by and among XXXXXXXX SOUP COMPANY, a New Jersey corporation
("Xxxxxxxx"), SILGAN CAN COMPANY, a Delaware corporation ("Purchaser"), and
SILGAN CONTAINERS CORPORATION, a Delaware corporation and the indirect parent of
Purchaser ("Silgan").
W I T N E S S E T H:
WHEREAS, immediately prior to the date hereof Xxxxxxxx transferred to
Xxxxxxxx Container Company, a Delaware corporation ("Subsidiary"), certain of
the assets of Xxxxxxxx related to its steel container manufacturing business
conducted at its facilities located in Paris, Texas; Maxton, North Carolina;
Napoleon, Ohio; and Sacramento, California, and certain limited obligations and
liabilities of Xxxxxxxx related to such business, all as further described in
this Agreement; and
WHEREAS, Xxxxxxxx desires to sell to Purchaser, and Purchaser desires to
purchase from Xxxxxxxx, all of the issued and outstanding capital stock of
Subsidiary, all upon the terms and subject to the conditions set forth in this
Agreement; and
WHEREAS, in connection with the transactions contemplated hereby, Xxxxxxxx
and Purchaser will enter into a supply agreement pursuant to which Purchaser
will supply Campbell's steel food and beverage container requirements.
NOW THEREFORE, in consideration of the premises and of the mutual
agreements and covenants hereinafter set forth and intending to be legally
bound, Xxxxxxxx, Purchaser and Silgan hereby agree as follows:
ARTICLE I
DEFINITIONS
1.1 Certain Defined Terms. As used in this Agreement, the following terms
shall have the following meanings:
"Affiliate" means (with respect to any person or entity) any other person
or entity which directly or indirectly owns or controls, or is owned or
controlled by, or is under common control with, the specified person or entity,
and includes any person who is an officer, director or employee of such person
or entity, and any person that would be deemed an "affiliate" or an "associate"
of such person or entity, as those terms are defined in Rule 12b-2 of the
General Rules and Regulations under the Securities Exchange Act of 1934, as
amended. For purposes of this definition, the term " control" as applied to any
person or entity (including with correlative meanings the terms "controlling,"
"controlled by" and "under common control with") means possession, directly or
indirectly, of power to direct or cause the direction of management or policies
(whether through ownership of securities, partnership or other ownership
interests, by contract or otherwise).
"Antitrust Improvements Act" means the Xxxx-Xxxxx-Xxxxxx Antitrust
Improvements Act of 1976, as amended, and the regulations adopted by the United
States Federal Trade Commission under that statute.
"Assignment" has the meaning set forth in Section 2.3.
"Assumed Liabilities" has the meaning set forth in Section 2.3.
"Budgeted Statement of Costs" has the meaning set forth in Section 5.5.
"Business" means the manufacture at the Xxxxxxxx Facilities of steel
containers for food and beverages sold by Xxxxxxxx, as carried on by Xxxxxxxx
and/or Subsidiary, as of the date of this Agreement.
"Business Day" means any day, Monday through Friday, on which commercial
banks are open for regular business in New York City.
"Xxxxxxxx Assets" has the meaning set forth in Section 2.1.
"Xxxxxxxx Closing Documents" means all documents, agreements, instruments,
certificates, bills of sale, deeds, easements, assignments, leases and notices
to be executed and delivered by Xxxxxxxx or caused by Xxxxxxxx to be executed
and delivered at the Closing pursuant to this Agreement (including, without
limitation, the Supply Agreement).
"Xxxxxxxx Disclosure Schedule" means the Disclosure Schedule prepared and
furnished by Xxxxxxxx to Purchaser, dated the same date as this Agreement and
containing the information and exceptions referred to in this Agreement as being
contained therein.
"Xxxxxxxx Facilities" means those portions of the facilities of Xxxxxxxx
located in Paris, Texas; Maxton, North Carolina; Napoleon, Ohio; and Sacramento,
California, operated by Xxxxxxxx and Subsidiary for the manufacture of steel
containers for food and beverages sold by Xxxxxxxx, which portions are the
subject of the Leases.
"Xxxxxxxx 401(K) Plan" has the meaning set forth in Section 8.2.
"Xxxxxxxx Indemnitee" has the meaning set forth in Section 11.2.
"Campbell's Environmental Reports" means the environmental site assessment
reports of Xxxxxxxx-Xxxxx Associates, Inc. listed on Xxxxxxxx Disclosure
Schedule 7.8(a) as Campbell's Environmental Reports, copies of which have been
provided to Purchaser prior to the date hereof.
"CBE Action" has the meaning set forth in Section 11.1.
"CERCLA" means the Comprehensive Environmental Response, Compensation and
Liability Act, as amended, and the regulations adopted by the United States
Environmental Protection Agency under that statute.
"Cleanup" means all actions required by Environmental Laws or by an order
of or at the direction of a governmental authority or court of competent
jurisdiction to: (1) cleanup, remove, treat or remediate Materials of
Environmental Concern in the indoor or outdoor environment; (2) prevent the
Release of Materials of Environmental Concern so that they do not migrate,
endanger or threaten to endanger public health or welfare or the indoor or
outdoor environment; (3) perform pre-remedial studies and investigations and
post-remedial studies and investigations and post-remedial monitoring and care;
or (4) respond to any governmental requests for information or documents in any
way relating to cleanup, removal, treatment or remediation of Materials of
Environmental Concern in the indoor or outdoor environment.
"Cleanup Standard" has the meaning set forth in Section 11.5.
"Closing" has the meaning set forth in Article IV.
"Closing Date" has the meaning set forth in Article IV.
"Code" means the United States Internal Revenue Code of 1986, as amended,
and the regulations adopted by the IRS under that statute.
"Consent Decree" has the meaning set forth in Section 11.5.
"Continued Employees" has the meaning set forth in Section 8.1.
"Contracts" has the meaning set forth in Section 2.1.
"Damages" has the meaning set forth in Section 11.1.
"Effective Time" has the meaning set forth in Section 2.6.
"Employee" has the meaning set forth in Section 5.18.
"Encumbrances" has the meaning set forth in Section 5.6.
"Environmental Claim" means any demand, suit, order, judgment, citation,
consent decree, claim, action, cause of action or notice, whether based on
contract, tort or any Environmental Law, by any person or entity alleging (i)
any liability or potential liability arising out of, based on or resulting from
the presence or Release or threatened Release of, or any exposure of any person
to, any Materials of Environmental Concern, (ii) responsibility or potential
responsibility for the Cleanup of any Materials of Environmental Concern, or
(iii) any violation of any Environmental Law.
"Environmental Laws" means all federal, state and local laws and
regulations (including common law) applicable to the Business and relating to
pollution or protection of human health or the environment, including, without
limitation, laws and regulations relating to Releases or threatened Releases of
Materials of Environmental Concern, or otherwise relating to the Cleanup,
manufacture, processing, distribution, use, treatment, storage, disposal,
transport or handling of Materials of Environmental Concern, or relating to
environmental record-keeping, reporting and training requirements.
"EPA" has the meaning set forth in Section 11.5.
"Equipment" has the meaning set forth in Section 2.1.
"Equipment Leases" has the meaning set forth in Section 2.1.
"ERC Agreements" has the meaning set forth in Section 11.5.
"ERCS" has the meaning set forth in Section 11.5.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended, and the regulations adopted by the United States Department of Labor
under that statute.
"ERISA Affiliate" means (i) any corporation included with a party hereto in
a controlled group of corporations within the meaning of Section 414(b) of the
Code; (ii) any trade or business (whether or not incorporated) which is under
common control with a party hereto within the meaning of Section 414(c) of the
Code; (iii) any member of an affiliated service group of which a party hereto is
a member within the meaning of Section 414(m) of the Code; or (iv) any other
person or entity treated as an affiliate of a party hereto under Section 414(o)
of the Code.
"Excluded Assets" has the meaning set forth in Section 2.2.
"Excluded Liabilities" has the meaning set forth in Section 2.3.
"Guaranty" has the meaning set forth in Section 10.11.
"Indemnitee" has the meaning set forth in Section 11.3.
"Indemnitor" has the meaning set forth in Section 11.3.
"Independent Expert" has the meaning set forth in Section 11.1.
"Intellectual Property" has the meaning set forth in Section 5.13.
"Inventory" has the meaning set forth in Section 2.1.
"IRS" means the United States Internal Revenue Service.
"Justice" has the meaning set forth in Section 11.5.
"Labor Supply Agreement" has the meaning set forth in Section 8.1.
"Labor Transfer Agreement" has the meaning set forth in Section 8.1.
"Letter of Credit" has the meaning set forth in Section 7.9.
"Material Adverse Effect" means a material adverse effect on the financial
condition of the Business, the Xxxxxxxx Assets and the Assumed Liabilities,
taken as a whole, other than with respect to any adverse effects resulting from
(i) public or industry knowledge relating to the transactions contemplated by
this Agreement, or (ii) past, existing or prospective economic, regulatory or
other conditions affecting generally the steel food container manufacturing
industry. Xxxxxxxx may, however, at its option, include in the Xxxxxxxx
Disclosure Schedule of this Agreement or elsewhere items which would not have a
Material Adverse Effect within the meaning of the previous sentence in order to
avoid any misunderstanding, and such inclusion shall not be deemed to be an
acknowledgement by Xxxxxxxx that such items would have a Material Adverse
Effect.
"Materials of Environmental Concern" means pollutants, contaminants,
hazardous waste, hazardous substances and materials, toxic substances, petroleum
and petroleum products, as defined in CERCLA or in any other Environmental Law,
as applicable.
"May 1 Letter" has the meaning set forth in Section 11.5.
"May 1 Letter Requirements" has the meaning set forth in Section 11.1.
"Note" means the secured 10-year note in the original principal amount of
$3 million dated the date hereof made by the Purchaser in favor of Xxxxxxxx,
which Note is to be delivered by Purchaser to Xxxxxxxx at the Closing as
payment, in part, of the Purchase Price.
"Permits" has the meaning set forth in Section 2.1.
"Plan" has the meaning set forth in Section 5.9(a).
"Pledge and Rights Agreement" has the meaning set forth in Section 9.10.
"Provided Employees" has the meaning set forth in Section 11.1.
"Purchase Price" has the meaning set forth in Section 3.1.
"Purchaser Closing Documents" means all documents, agreements, instruments,
certificates, leases and notices to be executed and delivered by Purchaser at
the Closing pursuant to this Agreement (including, without limitation, the
Supply Agreement).
"Purchaser Disclosure Schedule" means the Disclosure Schedule prepared and
furnished by Purchaser to Xxxxxxxx, dated the same date as this Agreement and
containing the information and exceptions referred to in this Agreement as being
contained therein.
"Purchaser Indemnitee" has the meaning set forth in Section 11.1.
"Purchaser's Environmental Reports" means the environmental site assessment
reports of The Park Corporation listed on Purchaser Disclosure Schedule 7.8,
copies of which have been or will be provided to Xxxxxxxx.
"Records" has the meaning set forth in Section 2.1.
"Release" means any release, spill, emission, discharge, leaking, pumping,
injection, deposit, disposal, discharge, dispersal, leaching or migration into
the environment (including, without limitation, ambient air, surface water,
groundwater and surface or subsurface strata) or into or out of any property,
including the movement of Materials of Environmental Concern through or in the
air, soil, surface water, groundwater or property.
"Returns" means all returns, reports, declarations, estimates and
statements of any nature relating to Taxes.
"Sacramento Action" has the meaning set forth in Section 11.1.
"Sacramento Facility" means the Xxxxxxxx Facility located in Sacramento,
California.
"Shared Services Agreement" has the meaning set forth in Section 9.9.
"Shares" has the meaning set forth in Section 2.4.
"Spare Parts" has the meaning set forth in Section 2.1.
"Subsidiary" means Xxxxxxxx Container Company, a Delaware corporation.
"Supply Agreement" means the Supply Agreement dated the date hereof between
Xxxxxxxx, Purchaser and Silgan for the supply by Purchaser of Campbell's steel
container requirements for food and beverage products.
"Taxes" (or "Tax" where the context requires) means any federal, state,
local, foreign or other taxes (including, without limitation, income net or
gross, gross receipts, profits, alternative or add-on minimum, franchise,
license, capital, capital stock, intangible, services, premium, mining,
transfer, sales, use, ad valorem, payroll, wage, severance, employment,
occupation, property (real or personal), windfall profits, import, excise,
custom, stamp, withholding or estimated taxes), fees, duties, assessments,
withholdings or government charges of any kind whatsoever (including interest,
penalties, additions to tax or additional amounts with respect to such items).
"Three Piece Can Manufacturing Equipment" has the meaning set forth in
Section 11.5.
"Transfer" has the meaning set forth in Section 2.1.
"Transfer Date" has the meaning set forth in Section 2.1.
"Wastewater Services Agreement" has the meaning set forth in Section 9.11.
ARTICLE II
TRANSFER TO SUBSIDIARY; PURCHASE AND SALE
2.1 Transfer of Xxxxxxxx Assets to Subsidiary. Effective May 31, 1998 (the
"Transfer Date"), Xxxxxxxx transferred, assigned and delivered to Subsidiary
(the "Transfer") all of Campbell's right, title and interest in and to the
following assets of Xxxxxxxx (the "Xxxxxxxx Assets"), free and clear of all
Encumbrances:
(a) the equipment, machinery, fixtures, furniture, vehicles and other
personal property specifically listed on Xxxxxxxx Disclosure Schedule 2.1(a)
(the "Equipment"); provided that, to the extent equipment used primarily in the
Business has been included in the portion of the Purchase Price applicable to
the Equipment and thereby paid for by Purchaser, but such Equipment is not
specifically set forth on Xxxxxxxx Disclosure Schedule 2.1(a), such missing
Equipment shall nevertheless be included as Xxxxxxxx Assets that shall be
transferred by Xxxxxxxx to Subsidiary pursuant to the Transfer;
(b) the contracts and agreements relating to or necessary for the Business
specifically set forth on Xxxxxxxx Disclosure Schedule 2.1(b) (the "Contracts");
(c) the leases of equipment, machinery and other personal property relating
to or necessary for the Business specifically set forth on Xxxxxxxx Disclosure
Schedule 2.1(c) (the "Equipment Leases");
(d) to the extent transferable or assignable under applicable laws,
including, without limitation, Environmental Laws, the licenses, permits and
other like approvals and authorizations, and all pending applications therefor
and renewals thereof, specifically listed on Xxxxxxxx Disclosure Schedule 2.1(d)
(the "Permits");
(e) the raw materials, work-in-progress and finished goods of the kind
described on Xxxxxxxx Disclosure Schedule 2.1(e) or included in determining the
Purchase Price that are located at, or in transit to, the Xxxxxxxx Facilities
and related to or necessary for the Business as of the Closing Date (the
"Inventory"); provided that any Inventory that contains, refers to, or infringes
upon any of Campbell's trade names or trademarks shall be used only in
connection with the sale of steel food and beverage containers to Xxxxxxxx under
the Supply Agreement;
(f) all spare parts and tools relating to or for the Equipment and all
supplies of the kind listed on Xxxxxxxx Disclosure Schedule 2.1(f) and located
at the Xxxxxxxx Facilities and related to or necessary for the Business as of
the Closing Date (the "Spare Parts");
(g) the books and records (including, without limitation, information
stored in a computerized format) of Xxxxxxxx located at the Xxxxxxxx Facilities,
which are solely related to the Business and to the continued operation of the
Xxxxxxxx Facilities and/or Xxxxxxxx Assets by Purchaser, together with copies of
all books and records that are related (but not solely related) to the Business
and to the continued operation of the Xxxxxxxx Facilities and/or Xxxxxxxx Assets
by Purchaser (the "Records");
(h) all intangible and intellectual property (other than software) of
Xxxxxxxx used and necessary for the operation of the Business at the Xxxxxxxx
Facilities, including, without limitation, all such trade secrets, know-how,
processes, methods, patents and patent rights, but specifically excluding any of
the foregoing used or necessary for Campbell's food processing business;
(i) all software, computer programs and databases and related manuals and
other materials used solely for the Business at the Xxxxxxxx Facilities;
(j) all claims of Xxxxxxxx against third parties to the extent, and only to
the extent, such claims relate to any of the Xxxxxxxx Assets and/or the Assumed
Liabilities, whether xxxxxx or inchoate, known or unknown, contingent or
otherwise; provided, that, in no event shall Xxxxxxxx be deemed to have
transferred its claim against Northern Can arising out of the purchase by
Xxxxxxxx from Northern Can of defective can ends in the fall of 1996, which can
ends are not part of the Xxxxxxxx Assets;
(k) all insurance proceeds arising in connection with damage to any of the
Xxxxxxxx Assets occurring prior to the Closing, to the extent not expended as of
the Closing Date for the repair or restoration of such Xxxxxxxx Assets; and
(l) all other tangible properties and assets of every kind, character or
description owned by Xxxxxxxx and solely used or held or necessary for use
solely for the Business as conducted at the Xxxxxxxx Facilities, whether or not
similar to the items specifically set forth above.
2.2 Excluded Assets. Notwithstanding anything contained in this Agreement
to the contrary, any and all assets of Xxxxxxxx or any of its Affiliates not
specifically included in Section 2.1, whether or not located at the Xxxxxxxx
Facilities or related to the operation of the Business, shall be excluded from
the Xxxxxxxx Assets (the "Excluded Assets"), including, without limitation, all
trademarks, trade names, service marks, copyrights, logos, slogans, UPC codes,
pending applications for the foregoing and similar intangibles owned or used by
Xxxxxxxx or its Affiliates.
2.3 Assignment of Assumed Liabilities. On the Transfer Date as part of the
Transfer, Xxxxxxxx shall assign to Subsidiary (the "Assignment") and Subsidiary
shall assume the obligations and liabilities of Xxxxxxxx, whether direct or
indirect, accrued or unaccrued, relating to the Business and Xxxxxxxx Assets
that are specifically set forth on Xxxxxxxx Disclosure Schedule 2.3 (the
"Assumed Liabilities"). Other than the Assumed Liabilities and those obligations
and liabilities of Xxxxxxxx expressly assumed by Purchaser under any Purchaser
Closing Document, Xxxxxxxx shall retain all other obligations and liabilities of
Xxxxxxxx (whether direct, contingent or unknown) relating to the Business,
including, without limitation, any and all obligations and liabilities to all
Employees (the "Excluded Liabilities"). Other than the Assumed Liabilities and
those obligations and liabilities of Xxxxxxxx expressly assumed by Purchaser
under any Purchaser Closing Document and other than as otherwise explicitly set
forth in this Agreement, neither Purchaser nor Subsidiary assumes or agrees to
be responsible for any obligations or liabilities of Xxxxxxxx of any nature
whatsoever, whether past, current or future and whether accrued, contingent,
unknown or otherwise, including, without limitation, any and all obligations and
liabilities to all Employees. The parties hereto acknowledge and agree that
Purchaser shall be responsible for Purchaser's obligations under the Consent
Decree (as hereinafter defined), and Xxxxxxxx shall be responsible for
Campbell's obligations under the Consent Decree.
2.4 Transfer of Shares. On the terms and subject to the conditions set
forth in this Agreement and in reliance upon the representations and warranties
contained herein, at the Closing Xxxxxxxx shall sell, convey, transfer, assign
and deliver to Purchaser, and Purchaser shall purchase and acquire from
Xxxxxxxx, all of Campbell's right, title and interest in and to all of the
outstanding shares of capital stock of Subsidiary (the "Shares"), free and clear
of all Encumbrances (other than those Encumbrances under applicable securities
laws).
2.5 Consent of Third Parties. This Agreement shall not constitute an
agreement to assign any interest in any instrument, contract, lease, permit or
other agreement or arrangement or any claim, right or benefit, (i) which by its
terms or by law is nonassignable without the consent of any other party or
parties, and such consent or approval has not been given, or (ii) as to which
all the benefits thereof or the remedies for the enforcement thereof available
to Xxxxxxxx would not by law pass to Purchaser or Subsidiary, as the case may
be, as an incident of the assignments provided for by this Agreement. If the
consent of a third party which is required in order to assign any such interest
is not obtained before the Closing, or if an attempted assignment would be
ineffective or would affect the interest or Campbell's ability to convey the
interest unimpaired, Xxxxxxxx, Purchaser and Subsidiary shall cooperate in any
lawful and commercially reasonable arrangement in order to cause Purchaser or
Subsidiary to receive the benefits of Campbell's interest, and to accept the
burdens and perform the obligations, under any such instrument, contract, lease,
permit or other agreement or arrangement or any such claim, right or benefit, it
being understood that Xxxxxxxx shall not be required to pay any money or other
consideration (unless reimbursed by Purchaser) or grant forbearances to any
third party to cause Purchaser to receive such benefits. Any transfer or
assignment to Purchaser or Subsidiary by Xxxxxxxx of any interest under any such
instrument, contract, lease, permit or other agreement or arrangement or any
such claim, right or benefit that requires the consent of a third party shall be
made subject to such consent or approval being obtained.
2.6 Effective Time. Subject to the terms and conditions of this Agreement,
the transactions contemplated by this Agreement shall be deemed to be effective
at 12:01 a.m. New York time on the Closing Date (the "Effective Time").
2.7 Merger. Immediately subsequent to the Closing and after the sale,
conveyance, transfer, assignment and delivery of the Shares by Xxxxxxxx to
Purchaser, Purchaser shall cause itself to be merged with and into Subsidiary in
accordance with applicable Delaware law, with Subsidiary being the surviving
corporation thereof but changing its name to "Silgan Can Company" and with the
certification of incorporation and by-laws of Purchaser being the certificate of
incorporation and by-laws of the surviving corporation. Xxxxxxxx hereby consents
to such merger and the transactions contemplated thereby (including those
transactions contemplated by the Agreement of Merger by and between Purchaser
and Subsidiary and the Certificate of Merger of Subsidiary), insofar as the
consent of Xxxxxxxx is required by the certificate of incorporation and/or
by-laws of Purchaser in effect as of the date hereof.
2.8 Supply Agreement. On the Closing Date, Xxxxxxxx, Purchaser and Silgan
shall enter into a Supply Agreement in the form attached hereto as Exhibit 2.8,
pursuant to which Purchaser shall sell to Xxxxxxxx, and Xxxxxxxx shall purchase
from Purchaser, Campbell's steel food and beverage container requirements upon
the terms and conditions set forth therein.
ARTICLE III
PURCHASE PRICE
3.1 Purchase Price.
(a) Purchase Price. The purchase price to be paid by Purchaser to Xxxxxxxx
for the Shares (the "Purchase Price") shall equal: (x) $ 109,321,382.00, plus
(y) the Inventory Value as shown on the Final Statement (as defined below).
(b) Closing Payment. At the Closing, Purchaser shall pay to Xxxxxxxx a cash
amount equal to an estimate of the Purchase Price, minus $3,000,000 (the
"Estimated Cash Purchase Price"), which $3,000,000 shall be paid by Purchaser to
Xxxxxxxx at the Closing by delivery of the Note. Such cash payment shall be made
in immediately available U.S. electronic funds transferred by wire to such
account or accounts, and in such manner, as Xxxxxxxx shall direct. The amount of
the Estimated Cash Purchase Price shall equal: (i) $109,321,382.00, plus (ii)
$13,550,539.00, which represents the estimated Inventory Value (as defined
below), minus (iii) $3,000,000.
(c) Closing Date Statement. Within 15 days following the Closing, Xxxxxxxx
shall prepare a statement (the "Statement") setting forth the net book value of
the Inventory as of the close of business on the business day immediately
preceding the Closing Date (the "Inventory Value" ), consistent with Campbell's
books and records immediately prior to the Closing (not to include in any event
any write-up of any expensed assets) (the "Accounting Principles") and deliver
it to Purchaser. Xxxxxxxx shall provide Purchaser with full access to Campbell's
working papers relating to the Statement and the books and records that underlie
those working papers. Purchaser shall complete its review of the Statement
within 15 days of its receipt thereof. As a result of its review, Purchaser may
notify Xxxxxxxx in writing of any objections it has to any aspect of the
Statement that relates solely to the application of the Accounting Principles.
Within the 15 day period following any such notification of objection, Xxxxxxxx
and Purchaser shall attempt in good faith to resolve all such objections.
Purchaser shall not be entitled to object to the Statement on any basis other
than the application of the Accounting Principles. If the parties are unable to
resolve all such objections within 15 days after Purchaser notifies Xxxxxxxx of
its objections, Xxxxxxxx and Purchaser shall retain Xxxxxx Xxxxxxxx LLP (the
"Independent Firm") to resolve any remaining objections and to prepare, if
necessary, a revised Statement reflecting its resolution of such remaining
objections. The Independent Firm's decision shall bind both Xxxxxxxx and
Purchaser. The fees and disbursements of such Independent Firm shall be
allocated between Xxxxxxxx and Purchaser so that Purchaser's share of such fees
and disbursements shall be in the same proportion that the aggregate amount of
disputed amounts so submitted to the Independent Firm that are unsuccessfully
disputed by Purchaser (as finally determined by the Independent Firm) bears to
the total amount of disputed amounts so submitted to the Independent Firm. The
"Final Statement" shall be the Statement meeting the definition of "Statement"
and with respect to which no further disputes exist between the parties because
one or more of the following has occurred: (a) Purchaser has not objected to the
Statement within the requisite 15 days, (b) Xxxxxxxx and Purchaser have agreed
on the Statement, or (c) the Independent Firm has delivered the revised
Statement reflecting the resolution of unresolved disputes between the parties
concerning the Statement. After the Closing Date, Purchaser shall provide
Xxxxxxxx and its representatives with access to the books and records of the
Business that are included in the Xxxxxxxx Assets and such assistance by
personnel of the Business that are employed by Purchaser as Xxxxxxxx may
reasonably require in order to carry out the provisions of this Section 3.1(c).
The procedures for resolutions of disputes concerning the Statement set forth in
this Section 3.1(c) are intended to be final and exclusive of any other contest
or appeal in relation thereto, so that if (x) Purchaser shall have failed to
give notice of any disputed item, or (y) having given notice of dispute of a
disputed item, Purchaser subsequently reached agreement with Xxxxxxxx on the
disputed item, or (z) no such agreement is reached and the matter is submitted
to the Independent Firm that has made its determination, then in all such cases,
neither party shall be entitled to subject such agreement or determination to
appeal in any court or tribunal. Any adjustment or non-adjustment to the
Statement shall not form the basis for any claims for damages pursuant to this
Agreement.
(d) Adjustment. If "A" (see below) is greater than "B" (see below) then on
the date which is two Business Days following the final determination of the
Final Statement (the "Adjustment Date") Xxxxxxxx shall pay Purchaser an amount
in cash equal to the difference (plus interest on such difference at a rate of
6% per year from and including the Closing Date to and including the Adjustment
Date). If "B" is greater than "A", then on the Adjustment Date, Purchaser shall
pay Xxxxxxxx an amount in cash equal to the difference (plus interest on such
difference, at the rate of 6% per year from and including the Closing Date, to
and including the Adjustment Date). For purposes of the first two sentences of
this subsection, "A' shall mean $13,550,539.00 and "B" shall mean the Inventory
Value shown on the Final Statement.
3.2 Physical Count of Inventory. The parties understand and acknowledge
that a portion of the Purchase Price is based on a physical count of the
Inventory conducted by Xxxxxxxx as of the close of business on the business day
immediately preceding the Closing Date and that Purchaser and Purchaser's
representatives were permitted to observe such physical count. The parties
further understand and acknowledge that such physical count was the basis for
determining the book value, net of reserves, of the Inventory, which amount is
included in the Purchase Price and was determined consistent with Campbell's
policies and practices with respect to valuing and counting inventory.
Notwithstanding the foregoing, each party hereto waives any and all claims,
causes of action or objections relating to or based upon such physical count
and/or (except for the adjustments provided in Section 3.1(d) above) the
determination of such book value or the portion of the Purchase Price related
thereto and hereby forever releases the other parties hereto, and their
respective shareholders, officers, directors and Affiliates from any such claim,
cause of action or objection.
3.3 Allocation. As promptly as practicable after the Closing, the parties
shall agree to an allocation of the Purchase Price and the Assumed Liabilities
(to the extent they are treated as liabilities for U.S. federal income tax
purposes) among the classes of Xxxxxxxx Assets, which allocation shall be based
upon appraisals of the Xxxxxxxx Assets obtained by Purchaser after the Closing
and performed by an appraiser reasonably acceptable to Xxxxxxxx. The parties
shall file all applicable tax returns in accordance with that allocation, and
neither Purchaser nor Xxxxxxxx will take, nor will they permit their Affiliates
to take, any position inconsistent with such allocation unless otherwise
required by applicable law.
ARTICLE IV
CLOSING
The closing of the purchase and sale of the Shares (the
"Closing") shall take place (with effect as of the Effective Time) at 10:00
a.m., New York time, on June 1, 1998 (the "Closing Date") at the offices of
Dechert Price & Xxxxxx, located at 4000 Xxxx Atlantic Tower, 0000 Xxxx Xxxxxx,
Xxxxxxxxxxxx, Xxxxxxxxxxxx 00000, or such other time and place as may be
mutually agreed upon by the parties. At the Closing, Purchaser shall pay the
Purchase Price provided for, and in the manner described, in Section 3.1, and
deliver the documents required to be delivered pursuant to Article X, and
Xxxxxxxx shall deliver the documents required to be delivered pursuant to
Article IX and, simultaneously therewith, shall take all steps as may be
reasonably required to put Subsidiary in possession and operating control of the
Xxxxxxxx Assets.
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF XXXXXXXX
Xxxxxxxx hereby makes the representations and warranties to Purchaser set
forth in this Article V, but subject to the information contained in, and the
exceptions noted or referred to in, the Xxxxxxxx Disclosure Schedule. The
disclosure of any matters in one part of the Xxxxxxxx Disclosure Schedule or any
document delivered pursuant to any provision of this Article V shall be deemed
to be a disclosure of such matters in response to any other provision of this
Article V to which such matter may be applicable.
5.1 Organization of Xxxxxxxx and Subsidiary. Xxxxxxxx is a corporation duly
organized, validly existing and in good standing under the laws of the State of
New Jersey. Subsidiary is a corporation duly organized, validly existing and in
good standing under the laws of the State of Delaware. Xxxxxxxx has all
requisite corporate power and corporate authority to execute and deliver this
Agreement and the Xxxxxxxx Closing Documents, to perform its obligations under
this Agreement and the Xxxxxxxx Closing Documents and to consummate the
transactions contemplated by this Agreement and the Xxxxxxxx Closing Documents.
Prior to the Transfer and Assignment Xxxxxxxx had, and as of the Closing,
Subsidiary has, all requisite corporate power to own or lease, and to operate,
its properties, and to carry on the Business to be carried on by it. Xxxxxxxx
has made available to Purchaser complete and correct copies of the Certificate
of Incorporation and the By-laws of Xxxxxxxx and Subsidiary as presently in
effect.
5.2 Corporate Authorization; No Violation. Xxxxxxxx has duly authorized the
execution and delivery of this Agreement and the Xxxxxxxx Closing Documents, the
performance by it of its obligations under this Agreement and the Xxxxxxxx
Closing Documents and the consummation of the transactions contemplated by this
Agreement and the Xxxxxxxx Closing Documents. This Agreement constitutes, and
each of the Xxxxxxxx Closing Documents to be executed and delivered by Xxxxxxxx
at the Closing shall, when so executed and delivered, constitute, the valid and
binding obligation of Xxxxxxxx, enforceable against Xxxxxxxx in accordance with
their respective terms (subject, as to enforcement, to bankruptcy,
reorganization, insolvency, moratorium, and other laws relating to or affecting
creditors' rights generally and to the availability of equitable remedies).
Except as set forth on Xxxxxxxx Disclosure Schedule 5.2, neither the execution
and delivery of this Agreement or any of the Xxxxxxxx Closing Documents by
Xxxxxxxx, nor the performance by Xxxxxxxx of its obligations under this
Agreement or any of the Xxxxxxxx Closing Documents nor the consummation by
Xxxxxxxx of the transactions contemplated by this Agreement or any of the
Xxxxxxxx Closing Documents will result in a breach of the terms, conditions or
provisions of, constitute a default under, result in any violation of, or result
in the creation of any Encumbrance upon any of the Shares or Xxxxxxxx Assets
pursuant to, the Certificate of Incorporation or the By-laws of Xxxxxxxx or
Subsidiary or any agreement or instrument to which Xxxxxxxx or Subsidiary is a
party or by which Xxxxxxxx or Subsidiary or any of the Xxxxxxxx Assets, Assumed
Liabilities or Shares is bound or any statute, law, ordinance, rule or
regulation of, or judgment, order, writ, injunction or decree of any court or
administrative or governmental agency or body applicable to Xxxxxxxx,
Subsidiary, any of the Xxxxxxxx Assets or Assumed Liabilities or any of the
Shares, except as will not result, either individually or in the aggregate, in a
Material Adverse Effect.
5.3 Compliance with Law. Except as disclosed on Xxxxxxxx Disclosure
Schedule 5.3, prior to the Transfer and Assignment, Xxxxxxxx holds all licenses,
permits and authorizations and made all filings and registrations necessary to
be filed, applied for, submitted or made to operate the Xxxxxxxx Assets pursuant
to all applicable statutes, laws, ordinances, rules and regulations of all
governmental bodies, agencies and subdivisions having jurisdiction over any part
of the Business or any of the Xxxxxxxx Assets or Assumed Liabilities, except as
will not result, either individually or in the aggregate, in a Material Adverse
Effect. Except as disclosed on Xxxxxxxx Disclosure Schedule 5.3, prior to the
Transfer and Assignment, Xxxxxxxx was not, and as of the Closing Subsidiary is
not, in violation of any laws or regulations concerning the Business or any of
the Xxxxxxxx Assets or Assumed Liabilities or Xxxxxxxx Facilities or any
licenses, permits, authorizations, filings or registrations referred to above,
which violations, individually or in the aggregate, would have a Material
Adverse Effect. Except as disclosed on Xxxxxxxx Disclosure Schedule 5.3, to
Campbell's knowledge, there is no proceeding pending or threatened to revoke or
amend or limit any such license, permit, authorization, filing or registration
of Xxxxxxxx.
5.4 Subsidiary. (a) Prior to the Transfer and Assignment, Subsidiary
carried on no activities and incurred no obligations or liabilities of any kind
whatsoever. After the Transfer and Assignment, Subsidiary carried on no
activities other than the Business and incurred no obligations or liabilities of
any kind whatsoever other than those incurred in the usual and ordinary course
of the Business conducted at the Xxxxxxxx Facilities and other than those
expressly contemplated hereby. As of the Closing: (i) all the Shares have been
validly issued and are fully paid and non-assessable; (ii) Xxxxxxxx owns all of
the Shares beneficially and of record, free and clear of any Encumbrance; and
(iii) there is no other outstanding capital stock of Subsidiary and no
outstanding securities convertible into or exchangeable or exercisable for any
shares of the capital stock or any other securities of Subsidiary, nor does
Subsidiary have outstanding any rights to subscribe for or to purchase, or any
options to purchase, or any agreements providing for the issuance of, any shares
of its capital stock, any securities convertible into or exchangeable or
exercisable for any shares of its capital stock or any other securities.
Xxxxxxxx shall deliver to the Purchaser at the Closing resignations of all
directors and officers of Subsidiary, effective as of the Closing Date.
(b) The authorized capital stock of Subsidiary consists of 100 shares of
common stock, $.01 par value per share, of which 100 are issued and outstanding
and constitute the Shares.
5.5 Statement of Cost. Xxxxxxxx Disclosure Schedule 5.5 includes a good
faith estimate by Xxxxxxxx of projected production costs, purchased can costs,
freight costs and certain corporate allocations relating to the Business for the
fiscal year ended July 31, 1998 (the "Budgeted Statement of Costs").
5.6 Xxxxxxxx Assets. Prior to the Transfer and Assignment, Xxxxxxxx owned
and had, and as of the Closing Subsidiary owns and has, valid title to all of
the Xxxxxxxx Assets that are not leased, free and clear of all mortgages, deeds
of trust, liens, pledges, charges, security interests, claims or encumbrances of
any kind or character (collectively, "Encumbrances"), except for those
Encumbrances (i) set forth on Xxxxxxxx Disclosure Schedule 5.6, (ii) zoning,
building, and other statutory or regulatory conditions and restrictions of
record, and (iii) liens for taxes and assessments not yet due and payable
(collectively, the "Permitted Encumbrances"). Prior to the Transfer and
Assignment, Xxxxxxxx had, and as of the Closing Subsidiary has, valid leasehold
interests to all of the Xxxxxxxx Assets that are leased, free and clear of all
Encumbrances, except for Permitted Encumbrances.
5.7 Operating and Trade Contracts and Agreements. Xxxxxxxx Disclosure
Schedule 5.7 sets forth the ten largest suppliers of goods to the Business in
terms of annual dollar volume. Except for the labor, retirement and similar
plans and agreements referred to in Sections 5.8 and 5.9, and the equipment
leases identified on Xxxxxxxx Disclosure Schedule 5.7 (complete copies of which
have been supplied to Purchaser), there are no agreements to which Xxxxxxxx or
Subsidiary is a party that (i) are necessary in the operation of the Business
consistent with past practices or relate to any of the Xxxxxxxx Assets or any of
the Assumed Liabilities and (ii) have an aggregate future liability of at least
$100,000 in any twelve-month period or are not terminable by Xxxxxxxx or
Subsidiary, as the case may be, for a total cost of less than $25,000. To
Campbell's knowledge, all such agreements are valid, enforceable and in full
force and effect, and there is no existing default thereunder by any party
thereto. Xxxxxxxx and/or Subsidiary has performed all obligations required to be
performed by either of them under all agreements to which either of them is a
party and that are necessary in the operation of the Business consistent with
past practices or that relate to any of the Xxxxxxxx Assets or Assumed
Liabilities, except for any nonperformance that, individually or in the
aggregate, would have a Material Adverse Effect.
5.8 Personnel Contracts and Collective Bargaining Agreements; Labor
Relations.
(a) Neither Xxxxxxxx nor Subsidiary is obligated with respect
to the Business under any written (i) agreement or contract with any officer or
employee of Xxxxxxxx or Subsidiary, other than contracts that by their terms are
cancelable by Xxxxxxxx or Subsidiary, as the case may be, on notice of not more
than 30 days without any liability or obligation on the part of Xxxxxxxx or
Subsidiary, as the case may be, or any assignee or (ii) collective bargaining
agreements or contracts with any labor union or other representative of
employees of Xxxxxxxx or Subsidiary, in each case except for those contracts and
agreements that are identified on Xxxxxxxx Disclosure Schedule 5.8 (complete
copies of which (including all documents, letters and other agreements amending
or supplementing or otherwise modifying such contracts and agreements) have been
supplied to Purchaser) or Xxxxxxxx Disclosure Schedule 5.9.
(b) Except as set forth in Xxxxxxxx Disclosure Schedule 5.8,
(a) there are no material controversies pending or, to the knowledge of
Xxxxxxxx, threatened, between Xxxxxxxx or Subsidiary and any Affected Employee;
(b) there are no written grievances that have been delivered or provided to
Xxxxxxxx or Subsidiary and that are outstanding against Xxxxxxxx or Subsidiary
relating to the Business under any collective bargaining agreements or contracts
with any labor union or other representative of employees which, individually or
in the aggregate, could have a Material Adverse Effect; (c) there are no unfair
labor practice complaints relating to the Business that are pending or, to the
knowledge of Xxxxxxxx, threatened against Xxxxxxxx or Subsidiary before the
National Labor Relations Board; (d) Xxxxxxxx has no knowledge of any strikes,
slowdowns, work stoppages, lockouts, or threats thereof, by or with respect to
any employees of Xxxxxxxx or Subsidiary for the Business; (e) to Campbell's
knowledge, there are no union organizational drives in progress involving an
actual distribution of union authorization cards and there has been no formal or
informal request to Xxxxxxxx or Subsidiary for collective bargaining or for an
employee election from any union or from the National Labor Relations Board with
respect to any employees of Xxxxxxxx or Subsidiary for the Business; (f) to
Campbell's knowledge, no union representation or jurisdictional dispute or
question exists respecting any employees of Xxxxxxxx or Subsidiary for the
Business; and (g) neither Xxxxxxxx nor Subsidiary is delinquent in the payment
to or on behalf of any past or present employees of the Business of any wages,
salaries, commissions, bonuses, benefit plan contributions, or other
compensation for all periods prior to the Closing Date.
5.9 Employee Benefit Plans. With respect to employee benefits currently
provided to employees of the Business:
(a) Xxxxxxxx Disclosure Schedule 5.9 comprises a complete and
correct list of all "employee pension benefit plans" (as defined in Section 3(2)
of ERISA), "employee welfare benefit plans" (as defined in Section 3(l) of
ERISA), bonus and incentive compensation plans, stock purchase and stock option
plans, deferred compensation plans, severance plans and other material fringe
benefit plans that Xxxxxxxx or Subsidiary maintains, or to which Xxxxxxxx or
Subsidiary presently contributes, and that relate to any employees of the
Business (collectively, the "Plans"). Xxxxxxxx has made available to Purchaser
complete and correct copies of all Plans and all relevant documents related to
the Plans, including, as applicable, plan texts and trust agreements and
amendments thereto, summary plan descriptions, actuarial reports for the most
recent valuation period, the IRS Form 5500 (together with all schedules and
attachments thereto) filed for the 1994, 1995 and 1996 plan years, the most
recent determination letters issued by the IRS (and, if there has been no
determination letter, all relevant correspondence with the IRS), insurance
contracts and employee handbooks.
(b) Each of the Plans is in material compliance with, and has
been administered in all material respects in accordance with, all requirements
of ERISA, the Code and other applicable law and the terms of such Plan. Each
Plan purported to be qualified under Code Section 401(a) has received a
favorable determination letter from the IRS (or, if no such determination letter
has been received for a Plan, such Plan is so qualified) and, to Campbell's
knowledge, no event has occurred which would cause the loss of such
qualification.
(c) To Campbell's knowledge, none of the Plans that is an
"employee pension benefit plan" (as defined in Section 3(2) of ERISA), and no
fiduciary thereof or trust created thereunder, has engaged in any transaction
that has subjected, or may reasonably be expected to subject, Xxxxxxxx or
Subsidiary, directly or indirectly, to any material tax on prohibited
transactions imposed by Section 4975 of the Code or to any material civil
penalty imposed under Section 502 of ERISA.
(d) Neither Xxxxxxxx nor Subsidiary is a party to any pension
plan or welfare benefit plan that is a "multiemployer plan" within the meaning
of Section 3(37) of ERISA. On the Closing Date, neither Xxxxxxxx, Subsidiary nor
any ERISA Affiliate of Xxxxxxxx or Subsidiary has any liability to make any
withdrawal liability payment to any multiemployer plan.
(e) There are no pending or, to the knowledge of Xxxxxxxx,
threatened investigations or enforcement actions against Xxxxxxxx or Subsidiary
with respect to any of the Plans.
(f) There are no pending or, to the knowledge of Xxxxxxxx,
threatened actions, suits or claims (other than routine claims for benefits) by
present or former employees of Xxxxxxxx or Subsidiary (or their beneficiaries)
with respect to any of the Plans or any of their assets or fiduciaries.
5.10 Environmental Matters. With respect to the Xxxxxxxx Assets and the
operations of the Business, except as disclosed on Xxxxxxxx Disclosure Schedule
5.10:
(a) Except to the extent that failure to comply, either
individually or in the aggregate, would not result in an Material Adverse
Effect, Xxxxxxxx and Subsidiary have been operating the Business, and all of the
Xxxxxxxx Assets are, in compliance with all Environmental Laws, except for any
noncompliance as a result of Subsidiary not having made any filing, registration
or notification or holding any permit, license or authorization required under
any Environmental Law; and
(b) There is no Environmental Claim pending or, to Campbell's
knowledge, threatened, against Xxxxxxxx, Subsidiary, any of the Xxxxxxxx Assets
or any Xxxxxxxx Facility that, either individually or in the aggregate, would
have a Material Adverse Effect.
5.11 Litigation.
(a) As of the date hereof, there is no claim, action, suit,
proceeding or governmental investigation pending or, to the knowledge of
Xxxxxxxx, threatened, against or involving Xxxxxxxx or Subsidiary which
questions the validity of this Agreement or seeks to prohibit, enjoin or
otherwise challenge any of the transactions contemplated by this Agreement or
any of the Xxxxxxxx Closing Documents.
(b) As of the date hereof, except as disclosed on Xxxxxxxx
Disclosure Schedule 5.11, there is no claim, action, suit, proceeding or, to the
knowledge of Xxxxxxxx, governmental investigation pending or threatened against
Xxxxxxxx or Subsidiary which, either individually or in the aggregate, would
have a Material Adverse Effect.
(c) Except as disclosed on Xxxxxxxx Disclosure Schedule 5.11,
neither Xxxxxxxx nor Subsidiary is subject to any judgment, order, writ,
injunction or decree which, either individually or in the aggregate, would have
a Material Adverse Effect, nor is Xxxxxxxx or Subsidiary in default under any
judgment, order, writ, injunction or decree to which it is subject, the
consequences of which default, individually or in the aggregate, would have a
Material Adverse Effect.
5.12 Taxes. Xxxxxxxx and Subsidiary have timely filed when due all material
Returns required by applicable federal, state or local law to be filed by either
of them, all such Returns are true, complete and correct, and Xxxxxxxx and
Subsidiary have paid all Taxes due pursuant to such Returns.
5.13 Intellectual Property. Xxxxxxxx Disclosure Schedule 5.13 lists all
trademarks, trade names, patents, computer software (other than software
purchased by Xxxxxxxx or Subsidiary that is generally available and has not been
modified for the Business) and copyrights, as well as all licenses or other
similar agreements to which Xxxxxxxx or Subsidiary is a party relating to any
intellectual property, that are necessary in the operation of the Business in
all material respects, consistent with past practices (the "Intellectual
Property"), all of which, except as set forth on Xxxxxxxx Disclosure Schedule
5.13, were owned by Xxxxxxxx prior to the Transfer and Assignment and are now
owned by Subsidiary and included in the Xxxxxxxx Assets. Xxxxxxxx was, and as of
the Closing Subsidiary is, the sole and exclusive beneficial owner of such
Intellectual Property, free and clear of all Encumbrances, except as set forth
on Xxxxxxxx Disclosure Schedule 5.13. Except as disclosed on Xxxxxxxx Disclosure
Schedule 5.13, to the knowledge of Xxxxxxxx, there has been no infringement or
violation of Campbell's or Subsidiary's rights in or to any Intellectual
Property, nor, to the knowledge of Xxxxxxxx, any claim of adverse ownership,
invalidity or other opposition to or conflict with any Intellectual Property
which in any such case, either individually or in the aggregate, would have a
Material Adverse Effect. To the knowledge of Xxxxxxxx, there has been no
activity in which Xxxxxxxx or Subsidiary is engaged in carrying on the Business
that violates or infringes any intellectual property rights of any third party.
5.14 Consents. Except for the requirements of the Antitrust Improvements
Act or as shown on Xxxxxxxx Disclosure Schedules 5.14 or 5.2, no consent,
approval or authorization of, or declaration, filing (other than filings with
tax authorities) or registration with, any governmental or regulatory authority
or any other third party is required to be made or obtained by Xxxxxxxx or
Subsidiary in order to consummate the transactions contemplated by this
Agreement and the Xxxxxxxx Closing Documents.
5.15 Absence of Certain Changes and Undisclosed Liabilities. Except as set
forth on Xxxxxxxx Disclosure Schedule 5.15 and except as contemplated or
permitted by this Agreement, since December 31, 1997: (a) neither Xxxxxxxx nor
Subsidiary has entered into any pledge, commitment, transaction or other
agreement relating to the Business involving expenditures of more than $100,000,
other than in the ordinary course of business, including, without limitation,
any borrowing or capital expenditure material to the Business, (b) Xxxxxxxx and
Subsidiary have operated the Business, and maintained the books and records
thereof, in accordance with past practices and (c) there has not been (i) any
material change by Xxxxxxxx or Subsidiary in accounting methods or principles
applicable to any portion of the Business, (ii) any labor trouble or work
stoppage having, either individually or in the aggregate, a Material Adverse
Effect, (iii) any material change in the practices of Xxxxxxxx or Subsidiary
with respect to the manner and timing of payment of trade or other payables of
the Business, (iv) any mortgage, pledge or imposition of an Encumbrance on any
of the assets or properties of the Business, other than in the ordinary course
of business, (v) any damage, destruction or loss (whether or not covered by
insurance) affecting any of the Xxxxxxxx Assets, the Xxxxxxxx Facilities or the
Business that has had or is likely to have, either individually or in the
aggregate, a Material Adverse Effect, (vi) any sale, transfer or other
disposition of any tangible or intangible assets of the Business (except in the
ordinary course of business) having an aggregate book value of $100,000 or more,
(vii) any write-down or write-up of the value of any of the Xxxxxxxx Assets,
(viii) other than in the ordinary course and consistent with past practices, any
general uniform increase in the compensation of employees of Xxxxxxxx or
Subsidiary relating to the Business (including, without limitation, any increase
pursuant to any Plan, but excluding any increase pursuant to any collective
bargaining agreement), (ix) any material increase in inventory levels of the
Business in excess of historical levels for comparable periods, (x) any material
change in policies, operations or practices with respect to business operations
followed by Xxxxxxxx or Subsidiary in connection with the Business, or (xi) any
other change in the Business or any of the Xxxxxxxx Assets, which in the
judgment of Xxxxxxxx has, or would reasonably be expected to have, either
individually or in the aggregate, a Material Adverse Effect.
5.16 Effect of Agreements. As a result of the Transfer and Assignment,
Subsidiary will have ownership of, a leasehold interest in, a license to, an
assignment of, or access to, all assets necessary to operate the Business in all
material respects consistent with past practices, except for the Excluded Assets
and except as provided in Section 2.5.
5.17 Xxxxxxxx Fiscal 1998 Can Manufacturing Plan. Xxxxxxxx has delivered to
Purchaser the manufacturing forecasts for the Business by size, type/can class,
and facility (the "Plan"), as in effect on the date hereof. Notwithstanding the
foregoing, Purchaser waives any and all claims or causes of action for any
breach of this Section 5.17 and/or to the extent that the same relate to or are
based upon the Plan and hereby forever releases Xxxxxxxx and its shareholders,
officers, directors and Affiliates from any such claim or cause of action.
5.18 Compensation. Xxxxxxxx Disclosure Schedule 5.18 hereto contains a list
as of a date no more than ten Business Days prior to the date hereof, of all
salaried employees of Xxxxxxxx or Subsidiary employed primarily for the Business
(collectively, with all other employees of Xxxxxxxx for the Business, the
"Employees"), together with the amount of total compensation paid to each such
person for the twelve month period ended December 31, 1997 and the current
aggregate base salary or hourly rate (including any bonus or commission) for
each such person.
ARTICLE VI
REPRESENTATIONS AND WARRANTIES OF PURCHASER AND SILGAN
Purchaser and Silgan hereby make the representations and
warranties to Xxxxxxxx set forth in this Article VI, but subject to the
information contained in, and the exceptions noted or referred to in, the
Purchaser Disclosure Schedule. The disclosure of any matters in one part of the
Purchaser Disclosure Schedule or any document delivered pursuant to any
provision of this Article VI shall be deemed to be a disclosure of such matters
in response to any other provision of this Article VI to which such matter may
be applicable.
6.1 Organization of Purchaser. Each of Purchaser and Silgan is a
corporation duly organized, validly existing and in good standing under the laws
of its jurisdiction of incorporation and has all requisite corporate power and
authority to execute and deliver this Agreement and the Purchaser Closing
Documents to which it is a party, to perform its obligations under this
Agreement and the Purchaser Closing Documents to which it is a party and to
consummate the transactions contemplated by this Agreement and the Purchaser
Closing Documents to which it is a party. Each of Purchaser and Silgan has all
requisite corporate power to own or lease and operate its properties, and to
carry on the Business.
6.2 Corporate Authorization; No Violation. Each of Purchaser and Silgan has
duly authorized the execution and delivery by it of this Agreement and the
Purchaser Closing Documents to which it is a party, the performance by it of its
obligations under this Agreement and the Purchaser Closing Documents to which it
is a party and the consummation of the transactions contemplated by this
Agreement and the Purchaser Closing Documents to which it is a party. This
Agreement constitutes, and each of the Purchaser Closing Documents to be
executed and delivered by Purchaser and/or Silgan at the Closing shall, when so
executed and delivered, constitute, the legal, valid and binding obligation of
Purchaser and/or Silgan, as the case may be, enforceable against Purchaser
and/or Silgan, as the case may be, in accordance with its terms (subject, as to
enforcement, to bankruptcy, reorganization, insolvency, moratorium and other
laws relating to or affecting creditors' rights generally and subject to the
availability of equitable remedies). Except as shown in Purchaser Disclosure
Schedule 6.2, neither the execution and delivery by Purchaser or Silgan of this
Agreement or any of the Purchaser Closing Documents to which it is a party nor
the performance by Purchaser or Silgan of its respective obligations under this
Agreement or any of the Purchaser Closing Documents to which it is a party nor
the consummation by Purchaser or Silgan of the transactions contemplated by this
Agreement or any of the Purchaser Closing Documents to which it is a party will
conflict with or result in a breach of the terms, conditions or provisions of,
constitute a default under, result in the violation of, or the creation of a
lien or encumbrance upon any of the assets of Purchaser pursuant to, the
respective Certificates of Incorporation or By-laws, each as amended, of each of
Purchaser and Silgan or any agreement or instrument to which Purchaser or Silgan
is a party or by which Purchaser or Silgan or any of their assets are bound or
any judgment, order, writ, injunction or decree of any court, administrative or
governmental agency or body applicable to Purchaser or Silgan.
6.3 Litigation. There is no claim, action, suit, proceeding or governmental
investigation pending or, to the knowledge of Purchaser and Silgan, threatened
against or involving Purchaser or Silgan or any Affiliate of either which
questions the validity of this Agreement or seeks to prohibit, enjoin or
otherwise challenge any of the transactions contemplated by this Agreement or
any of the Purchaser Closing Documents.
6.4 Consents. Except for the requirements of the Antitrust Improvements
Act, no consent, approval or authorization of, or declaration, filing (other
than filings with tax authorities) or registration with, any governmental or
regulatory authority or any third party is required to be made or obtained by
Purchaser or Silgan before the consummation of the transactions contemplated by
this Agreement and the Purchaser Closing Documents.
6.5 Investment Intent. Purchaser is an "accredited investor" within the
meaning of Regulation D adopted by the United States Securities and Exchange
Commission under the Securities Act of 1933, as amended. Purchaser is acquiring
the Shares for investment purposes only and not with a view to any public
distribution of any of the Shares. Purchaser shall not sell or otherwise dispose
of any of the Shares in violation of the Securities Act of 1933, as amended, the
rules and regulations adopted by the United States Securities and Exchange
Commission under that Act or any other applicable securities laws.
6.6 Multiemployer Plan Obligations. Purchaser Disclosure Schedule 6.6 sets
forth (i) any "multiemployer plan," within the meaning of Section 3(37) of
ERISA, that Purchaser, Silgan or any current or former ERISA Affiliate of
Purchaser or Silgan (referred to herein as "MEP Party") has ever contributed to,
or been required to contribute to, (ii) the amount of any liability any MEP
Party has incurred as a result of a withdrawal or partial withdrawal from each
such plan, the date such liability was incurred and the amount of any payments
made to satisfy any such liability and (iii) for each such plan, an estimate,
provided by the board of trustees of such plan, of the potential withdrawal
liability should any MEP Party that is currently obligated to contribute to such
a plan withdraw or partially withdraw from the plan, calculated as of a date
within the one-year period ending on the Closing Date.
ARTICLE VII
COVENANTS AND AGREEMENTS
7.1 Best Efforts. Purchaser and Xxxxxxxx shall cooperate with each other
and use their commercially reasonable best efforts to obtain all other
governmental and third party consents and approvals necessary to complete the
transactions contemplated by this Agreement. This obligation shall not require
either party to pay any monies or other value to any third party, except for
filing fees imposed by law.
7.2 Accounting Matters. Purchaser may require certain audited annual and
unaudited interim financial statements with respect to the Business to satisfy
applicable Securities and Exchange Commission reporting requirements. If
Purchaser requires any such financial statements, Xxxxxxxx will take all steps
reasonably necessary and appropriate to provide Purchaser with such financial
statements in a timely manner after the Closing. Purchaser agrees to reimburse
Xxxxxxxx for all reasonable costs and expenses incurred by Xxxxxxxx to provide
such financial statements including, without limitation, the reasonable costs
and expenses of Campbell's independent accounting firm.
7.3 Taxes.
(a) Xxxxxxxx shall be responsible (i) for all Taxes imposed
upon or measured by the taxable income of (A) Xxxxxxxx, including all taxable
income allocable to any period ending before the Closing Date, and (B)
Subsidiary allocable to any period ending before the Closing Date, and (ii) for
all other Taxes relating to the Business, Subsidiary or any of the Xxxxxxxx
Assets allocable to any period ending before the Closing Date. Xxxxxxxx shall
indemnify Purchaser, Subsidiary and any other person with which Purchaser or
Subsidiary files, has filed or will file a consolidated or combined Return
against, and shall hold them harmless from, any and all such Taxes. Xxxxxxxx
shall be responsible for completing and filing all Returns relating to the Taxes
described in the first sentence of this Section 7.3(a).
(b) Xxxxxxxx shall, and Silgan shall cause Silgan Corporation
to, make timely and valid elections under Code Sections 338(g) and 338(h)(10)
(and any analogous state and local tax provisions) with respect to the sale of
the Shares. Xxxxxxxx shall pay any and all Taxes attributable to the making of
such elections and shall be responsible for completing and filing all Returns
relating to such Taxes. Xxxxxxxx shall indemnify Purchaser, Subsidiary and any
other person with which Purchaser or Subsidiary files, has filed or will file a
consolidated or combined Return against, and shall hold them harmless from, any
and all Taxes resulting from the filing of such elections.
(c) After the Closing Date, Xxxxxxxx and Purchaser shall
prepare or cause to be prepared and delivered to the other party such
information as the other party shall reasonably request to enable it to prepare
its Returns. Subject to Section 13.17, Purchaser and Xxxxxxxx agree to furnish
or cause to be furnished to each other, upon request, as promptly as is
practical, such additional information (including by means of access to books
and records) and assistance relating to the Business and the Xxxxxxxx Assets as
is reasonably necessary for the filing of any Returns, preparation for any audit
and prosecution or defense of any claim, suit or proceeding relating to any
Taxes or proposed adjustment to Taxes. Purchaser and Xxxxxxxx shall notify the
other party of its receipt of any notice regarding Tax audits or adjustments
that may affect the Tax liability of the other party. Purchaser and Xxxxxxxx
shall reasonably cooperate with each other in the conduct of any Tax audit or
other Tax proceedings involving Xxxxxxxx or Purchaser or any entity with which
Xxxxxxxx or Purchaser is, was or will be consolidated or combined for any Tax
purpose, and each shall execute and deliver such powers of attorney and other
documents as may be reasonably necessary or useful to carry out the intent of
this Section 7.3(c).
(d) Each party hereto shall keep or cause to be preserved and
kept the records related to the Business and in its possession after the Closing
for a period of seven years after the Closing Date, or for any longer period as
may be required by any statute, regulation, government agency or ongoing
litigation, and to make such records available to the other parties or their
representatives as may be reasonably requested by the other party in connection
with any legal proceedings against, or any governmental investigations or Tax
examination of, the other party. If a party wishes to destroy such records after
that time, it shall first give the other party 60 days' prior written notice,
and the other party shall have the right, at its option, upon prior written
notice to the first party within that 60-day period, to take possession of those
records within 90 days after the date of the first party's notice.
7.4 Signage. Purchaser shall, at Purchaser's expense, remove, destroy and
dispose of all signs featuring, containing or comprising names or logos of
Xxxxxxxx or its Affiliates appearing anywhere in, on or about any of the
Facilities as soon as practicable after the Closing Date.
7.5 Post-Closing by Purchaser. After the Closing Date, Purchaser shall
give, or cause to be given, to Campbell's representatives (including, without
limitation, its accountants, counsel, employees, contractors, consultants and
engineers), upon reasonable notice and during normal business hours at
Purchaser's premises, such reasonable access to the personnel, properties,
contracts, books, records, files, documents and affairs of the Business and
copies (at the expense of Xxxxxxxx) of contracts, books, records, files and
documents that are among the Xxxxxxxx Assets as are reasonably necessary to
allow Xxxxxxxx to perform any Cleanup that Xxxxxxxx is permitted to perform at
any Xxxxxxxx Facility pursuant to this Agreement, any Lease or the Wastewater
Services Agreement, to fulfill its obligations under the Wastewater Services
Agreement and other Xxxxxxxx Closing Documents and as otherwise necessary to
conduct its activities permitted under the Wastewater Services Agreement, and to
obtain information in connection with the preparation for any audit of
Campbell's Returns and any claims (including Environmental Claims), demands,
reports, other audits, suits, actions or proceedings by or against, or
obligations of, Xxxxxxxx. Purchaser shall cooperate in all reasonable respects
with Xxxxxxxx after the Closing with respect to any claims, demands, Tax or
other audits, suits, actions and proceedings by or against Xxxxxxxx relating to
the Business.
7.6 Post-Closing by Xxxxxxxx. After the Closing, Xxxxxxxx shall give, or
cause to be given, to Purchaser and its representatives (including, without
limitation, its accountants, counsel and employees), upon reasonable notice and
during normal business hours at Campbell's premises, such reasonable access to
the personnel, properties, contracts, books, records, files, documents and
affairs of Xxxxxxxx relating to the Business and copies (at the expense of
Purchaser) of contracts, books, records, files and documents as are reasonably
necessary to allow Purchaser to obtain information in connection with the
preparation for and any audit of the Returns of Purchaser or Subsidiary and any
claims, demands, other audits, suits, actions or proceedings by or against, or
obligation of, Purchaser or Subsidiary. After the Closing, Xxxxxxxx shall
cooperate in all reasonable respects with Purchaser with respect to any claims
(including Environmental Claims), demands, Tax or other audits, suits, actions
or proceedings by or against Purchaser as the owner and operator of the Business
or Subsidiary, and in connection therewith, shall give Purchaser reasonable
access to and copies of (at the expense of Purchaser) the books, records, files
and documents of Xxxxxxxx relating to the Business that are among the Excluded
Assets. Purchaser and Xxxxxxxx shall keep each other fully informed of all
matters relating to any audit or judicial or administrative proceeding,
including, without limitation, any settlement negotiations for which such party
is requesting access under Section 7.5 or 7.6, as the case may be.
7.7 Elaboration. For purposes of Sections 7.5 and 7.6: (i) wherever access
to records is referred to, such access shall be at the location of the
possessing party where such records are located; (ii) Purchaser and Xxxxxxxx
shall each retain all records referred to in Sections 7.5 and 7.6 for all
periods required under applicable law and (iii) references to "at the expense"
of a party shall mean any reasonable and necessary payment to unrelated third
parties, but shall not include reimbursement of overhead and employee costs of
the other party.
7.8 Environmental Matters. (a) The parties hereto acknowledge that, prior
to the date hereof, Purchaser's environmental consultant has prepared the
Purchaser's Environmental Reports for environmental site assessments that it
performed for each of the Xxxxxxxx Facilities, which Reports are listed on
Purchaser Disclosure Schedule 7.8(a) hereto and copies of which have been
provided to Xxxxxxxx. Xxxxxxxx reserves its right to enter any Xxxxxxxx Facility
to perform any testing it reasonably determines is necessary or desirable to
confirm the results of the Purchaser's Environmental Reports, provided that in
connection therewith in no event shall Xxxxxxxx interfere with Purchaser's
operations in any material respect at any such Xxxxxxxx Facility. Any dispute
regarding the results of the Purchaser's Environmental Reports shall be resolved
as provided in Section 11.1 hereof.
(b) Xxxxxxxx agrees to perform the activities set forth on Xxxxxxxx
Disclosure Schedule 7.8(b) promptly after the Closing Date, in accordance with
all applicable Environmental Laws to the extent applicable. In connection with
the foregoing, Xxxxxxxx shall not unreasonably interfere with Purchaser's
operations.
7.9 Multiemployer Plan Obligations. (a) Until the termination of the Pledge
and Rights Agreement (as hereinafter defined), (i) Purchaser shall update all of
the information required by Schedule 6.6 hereto annually as of each January 1st,
using substantially the same form as set forth in Schedule 6.6 hereto (but the
reference to "Closing Date" at the end of Section 6.6 shall instead refer to the
date such updated information is provided), and shall provide such updated
information to Xxxxxxxx no later than the September 30th following such January
1st and (ii) Purchaser shall notify Xxxxxxxx in writing no later than five (5)
business days following an event which will result in, or is reasonably likely
to result in, the assessment of withdrawal or partial withdrawal liability by a
"multiemployer plan," within the meaning of Section 3(37) of ERISA, on
Purchaser, Silgan or any MEP Party. For purposes of this Section 7.9 , the term
"MEP Party" shall include any entity which becomes an ERISA Affiliate of
Purchaser or Silgan after the Closing Date.
(b) On the Closing Date, Silgan shall deliver to Xxxxxxxx an
irrevocable letter of credit with terms acceptable to Xxxxxxxx, the face amount
(i.e., the maximum amount that can be drawn thereunder) of which shall equal the
total of the incurred and potential liability disclosed in Schedule 6.6 hereto
(as amended or substituted from time to time, the "Letter of Credit"). The face
amount of the Letter of Credit shall be adjusted each September 30th in
accordance with the change in the total incurred and potential liability as of
the January 1st of such year as reported to Xxxxxxxx in accordance with Section
7.9(a) above.
(c) Subject to (d) below, Xxxxxxxx shall be entitled to draw
on the Letter of Credit, in accordance with the terms thereof, upon, and only
upon, (i) the assessment against it of withdrawal or partial withdrawal
liability by a multiemployer plan, based upon the participation of Purchaser,
Silgan or any MEP Party in such plan, (ii) the delivery by Xxxxxxxx to the
lending institution issuing such Letter of Credit (the "Bank") the documents
required thereby and (iii) the delivery by Xxxxxxxx to Silgan of documentation
reasonably supporting the existence of such assessment. Silgan shall indemnify
Xxxxxxxx for all Damages incurred by Xxxxxxxx (less amounts received by Xxxxxxxx
upon its draw on the Letter of Credit) relating to all such withdrawal or
partial withdrawal liability.
(e) Silgan shall maintain the Letter of Credit until either
(i) the Pledge and Rights Agreement terminates and no withdrawal or partial
withdrawal from a multiemployer plan by Purchaser, Silgan or any MEP Party has
occurred since the Closing Date, or (ii) all withdrawal and partial withdrawal
liability incurred by Purchaser, Silgan and any MEP Party between the Closing
Date and the date of the termination of the Pledge and Rights Agreement has been
satisfied. Xxxxxxxx acknowledges and agrees that the Letter of Credit shall, by
its terms, expire one year from its date of issuance, but is subject to
automatic extensions for successive one-year periods unless the Bank determines
not to so extend the Letter of Credit. In the event that the expiration date of
the Letter of Credit is not extended, immediately prior to its expiration,
Xxxxxxxx shall be entitled to drawn down the face amount thereof in accordance
with the terms of such Letter of Credit. In such event, Xxxxxxxx agrees that it
shall hold such funds in escrow on behalf and for the benefit of Silgan and
shall not be entitled to retain any of such funds unless and until Xxxxxxxx
would otherwise have been entitled to draw down such funds under such Letter of
Credit. At such time as Silgan replaces any expired Letter of Credit with a new
letter of credit with terms acceptable to Xxxxxxxx, Xxxxxxxx shall promptly
return to Silgan any and all funds drawn in the expired Letter of Credit and
then held in escrow (together with interest accrued thereon) by Xxxxxxxx.
Xxxxxxxx shall invest any such funds held in escrow in short term treasury
bills.
(f) Notwithstanding the foregoing, if at any time Silgan can
demonstrate that the current face amount of the Letter of Credit is materially
higher than the total amount of incurred and potential withdrawal and partial
withdrawal liability from all multiemployer plans in which Silgan, Purchaser or
any MEP Party participates that Silgan, Purchaser or any MEP Party would be
responsible for under ERISA at the applicable times, then the parties shall
negotiate in good faith the face amount of the Letter of Credit based on such
total maximum amount of withdrawal and partial withdrawal liability under ERISA.
ARTICLE VIII
COVENANTS AND REPRESENTATIONS
RELATING TO PERSONNEL ARRANGEMENTS
8.1 Continued Employees; Labor Supply Agreement. (a) Silgan shall offer
employment, effective as of the Closing Date, to those employees of Xxxxxxxx
listed on Purchaser Disclosure Schedule 8.1 to this Agreement. Silgan shall pay
each such employee who accepts such offer (hereafter a "Continued Employee") the
same monthly salary (excluding, however, variable compensation) that such
Continued Employee was receiving from Xxxxxxxx as of the day immediately
preceding the Closing Date.
(b) Continued Employees shall be as of the Closing Date
exclusively employees of Purchaser and shall no longer be employees of Xxxxxxxx.
Purchaser shall hold Xxxxxxxx harmless against any liabilities or obligations
relating to each Continued Employee's employment with Purchaser, including,
without limitation, any liability or obligation relating to compensation
(including, without limitation, wages and benefits), the provision of training,
withholding taxes and the completion and filing of all required documentation
relating thereto and duties imposed by any applicable law or regulation.
Xxxxxxxx shall satisfy and retain any and all responsibility for all, and
Xxxxxxxx acknowledges that Purchaser shall have no obligation or responsibility
for any, liabilities or obligations relating to (i) except as expressly provided
in the other Purchaser Closing Documents, any employee of Xxxxxxxx that is not a
Continued Employee, and (ii) except as expressly assumed by the Purchaser
hereunder, any Continued Employee for any period prior to such Continued
Employee becoming an employee of Purchaser. The covenants contained in this
paragraph shall remain in full force and effect regardless if, by operation of
any law, Purchaser (or its Affiliates) and Xxxxxxxx are deemed to be joint
employers, a single employer, or otherwise with respect to the Continued
Employees or any other employees of Xxxxxxxx.
(c) Xxxxxxxx shall retain and satisfy all obligations with
respect to, and administer all claims for, workers' compensation made by
Continued Employees for events occurring prior to the Closing Date in accordance
with Campbell's policies in effect as of the Closing Date. Xxxxxxxx shall also
retain all obligations for short-term and long-term disability benefits due to
Continued Employees for all events occurring prior to the Closing Date,
including all medical and related payments incurred prior to or after the
Closing Date.
(d) Xxxxxxxx and the Purchaser acknowledge that at the Closing
Xxxxxxxx and Purchaser will execute and deliver an agreement (the "Labor Supply
Agreement") pursuant to which, among other things, Xxxxxxxx will agree to
provide Purchaser with certain labor at the Xxxxxxxx Facilities as set forth
therein, as well as a letter agreement (the "Labor Transfer Agreement") pursuant
to which, among other things, the employees referenced therein will be
transferred to Purchaser.
8.2 Employee Benefits.
(a) As of the Closing Date, all Continued Employees shall
cease to accrue benefits under the Plans, and Xxxxxxxx shall take all such
action as may be necessary to effect such cessation. There shall be no transfer
of assets or liabilities of the Plans to any employee benefit plans of Purchaser
except as provided in Section 8.2(c) below. Xxxxxxxx shall retain all
responsibility for, and Purchaser shall have no obligation or responsibility
for, any of such benefits, except as provided in Section 8.2(c) below. As soon
as possible, but not later than 90 days following the Closing Date, Xxxxxxxx
will deliver to each Continued Employee one or more communications setting forth
in detail such Continued Employee's rights, benefits and status under the Plans.
Xxxxxxxx will provide copies to Purchaser of all communications from Xxxxxxxx to
Continued Employees at least five (5) business days prior to mailing such
communications to Continued Employees.
(b) Purchaser's offer of employment to Continued Employees
shall include benefits (other than compensation) generally offered by Silgan to
its salaried employees. All such Continued Employees shall receive from
Purchaser credit for years of service with Xxxxxxxx under Purchaser's applicable
defined contribution and deferred benefit employee plans for purposes of
eligibility and vesting. As soon as practicable after the Closing Date, Xxxxxxxx
shall pay all Continued Employees for their unused accrued vacation with
Xxxxxxxx as of the Closing Date. For the balance of the calendar year in which
the Closing Date occurs, Purchaser shall provide each Continued Employee who
remains employed by Purchaser for such balance of such calendar year with the
number of vacation days that such Continued Employee would have earned had they
remained employed by Xxxxxxxx for such balance of such calendar year.
(c) As soon as practicable following the Closing Date, but in
no event later than 120 days after the Closing Date, Xxxxxxxx shall cause the
Xxxxxxxx Soup Company Savings 401(K) Plan for Salaried Employees (the "Xxxxxxxx
401(K) Plan") to treat each Continued Employee as having separated from service
with Xxxxxxxx as of the Closing Date for purposes of applying the distribution
provisions of the Xxxxxxxx 401(K) Plan or as otherwise being entitled to receive
a distribution pursuant to Section 401(k)(10) of the Code to the extent
applicable. Purchaser agrees to cause its defined contribution plan or plans
("Buyer's successor plans") to accept a direct rollover, as provided under
Section 401(a)(31) of the Code, of any "eligible rollover distribution" (as
defined in Section 402(f)(2)(A) of the Code) from the Xxxxxxxx 401(K) Plan of a
Continued Employee who elects to make such a direct rollover to Purchaser's
successor plans. Xxxxxxxx shall make all unpaid contributions, if any, to the
Xxxxxxxx 401(K) Plan with respect to periods prior to the Closing Date.
(d) With respect to post-retirement health and life insurance
benefits for Continued Employees under the Plans, Xxxxxxxx shall retain all
responsibility for providing and shall provide, and Purchaser shall have no
obligation or responsibility for providing, such post-retirement benefits under
the Plans to those Continued Employees who are eligible to receive such
post-retirement benefits under the Plans as of the Closing Date.
(e) Xxxxxxxx shall maintain the defined benefit pension Plan
or Plans ("Xxxxxxxx Pension Plans") in which the Continued Employees
participated prior to the Closing Date on a "frozen" basis with respect to the
Continued Employees, with no benefits accruing to the Continued Employees after
the Closing Date. Such benefits shall be paid in accordance with the provisions
of the relevant plan. As soon as practicable after the Closing Date, Xxxxxxxx
shall provide to Purchaser a schedule detailing each Continued Employee's
accrued benefits under Campbell's Plans and any employee census data as
Purchaser shall reasonably request.
(f) Xxxxxxxx shall treat the Closing as a "Qualifying event"
(within the meaning of Section 4980B(f)(3) of the Code) and shall offer the
Continued Employees and their eligible dependents "COBRA" continuation coverage
under all Xxxxxxxx "group health plans" (within the meaning of Section
5000(b)(1) of the Code), including any related flexible spending account plans,
in which such Continued Employees and dependents participated immediately prior
to the Closing Date. Xxxxxxxx shall retain responsibility for claims made by
Continued Employees under Campbell's group health plans with respect to events
occurring prior to the Closing Date.
(g) Xxxxxxxx Disclosure Schedule 8.2(g) hereto sets forth a
list of each of the Continued Employees, the Xxxxxxxx Facility at which he/she
is located as of such date, the title or position held by such Continued
Employee as of such date, the prior titles or positions held by such Continued
Employee for the past five years (or such shorter period during which such
Continued Employee was employed by Xxxxxxxx), the initial date of hire by
Xxxxxxxx for such Continued Employee and the various dates that are used by
Xxxxxxxx to determine the years of service credited by Xxxxxxxx to each such
Continued Employee for purposes of eligibility and vesting under the Plans. At
the time of the Closing, there are no Continued Employees who are receiving (or
are eligible to receive) short-term or long-term disability benefits or workers'
compensation.
(h) Nothing contained in this Agreement, expressed or implied,
shall be interpreted to confer upon any of the Employees (including, without
limitation, the Continued Employees) any rights or remedies as third-party
beneficiaries, including, without limitation, any rights of continued
employment, any rights to a particular term of employment or any rights to any
particular compensation or benefits whatsoever (including, without limitation,
any form of notice or severance pay). The right to enforce any of the terms of
this Agreement shall inure only to the parties hereto and shall in no way extend
to any third parties who might benefit from the terms of this Agreement in any
way, including, without limitation, the Employees.
8.3 Restrictions on Hiring. During the term of the Supply Agreement, except
for Xxxxxx Xxxxxxx, Purchaser shall not hire, solicit for hire, recruit, or
otherwise hire any employee of Xxxxxxxx for employment (or for the provision of
any other services under contract) with Purchaser, nor any person who was
employed by Xxxxxxxx during any time during the one-year period preceding such
hiring, solicitation, or recruitment. During the term of the Supply Agreement,
Xxxxxxxx shall not hire, solicit for hire, recruit, or otherwise hire any
employee of Purchaser or its Affiliates for employment (or for the provision of
any other services under contract) with Xxxxxxxx, nor any person who was
employed by Purchaser at any time during the one-year period preceding such
hiring, solicitation, or recruitment.
ARTICLE IX
CLOSING DOCUMENTS TO BE DELIVERED BY XXXXXXXX
At the Closing, Xxxxxxxx shall deliver the following to Purchaser:
9.1 Opinion of Counsel. An opinion of Dechert Price & Xxxxxx, dated the
Closing Date, in form and substance satisfactory to Purchaser.
9.2 Certificates for Shares. Certificates representing the Shares, together
with duly executed stock powers covering the Shares, along with the minute books
and all records and documents of Subsidiary, including, without limitation, all
necessary bills of sale and transfer, assignments and other instruments of
conveyance and transfer to effect the Transfer and Assignment.
9.3 Consents. Copies of the written consents and approvals listed on
Xxxxxxxx Disclosure Schedule 5.14 (other than consents or approvals the failure
of which to obtain, either individually or in the aggregate, would not have a
Material Adverse Effect).
9.4 Secretary's Certificate. A certificate of the Secretary or an Assistant
Secretary of Xxxxxxxx dated the Closing Date and certifying (i) that attached
thereto is a true, complete and correct copy of the By-laws of Xxxxxxxx as in
effect on the date of such certification, (ii) that attached thereto is a true,
complete and correct copy of the Certificate of Incorporation, as amended, of
Xxxxxxxx as certified as of a recent date by the Secretary of State of the State
of New Jersey, (iii) that attached thereto are true, complete and correct copies
of the resolutions duly adopted by the Board of Directors of Xxxxxxxx approving
the transactions contemplated hereby and authorizing the execution, delivery and
performance by Xxxxxxxx of this Agreement and the Xxxxxxxx Closing Documents, as
in effect on the date of such certification, and (iv) as to the incumbency and
signatures of certain officers of Xxxxxxxx executing any instrument or other
document delivered in connection with such transactions.
9.5 Further Instruments. Such further instruments of assignment, conveyance
or transfer or other documents (subject to Section 2.5) as Purchaser may
reasonably request relating to the Shares and the transactions contemplated
hereby, including, without limitation, memoranda of leases for each of the
Xxxxxxxx Facilities to be leased, each in the customary form for the state in
which such Xxxxxxxx Facility is located, and such other documents as Purchaser
may reasonably request consistent with the terms hereof.
9.6 Supply Agreement. The Supply Agreement executed by Xxxxxxxx, in form
and substance satisfactory to Purchaser.
9.7 Leases. A lease for each Xxxxxxxx Facility (collectively, the "Leases,"
and, individually, a "Lease") executed by Xxxxxxxx, in form and substance
satisfactory to Purchaser.
9.8 Labor Supply Agreement. The Labor Supply Agreement and the Labor
Transfer Agreement executed by Xxxxxxxx, in form and substance satisfactory to
Purchaser.
9.9 Shared Services Agreement. A shared services agreement (the "Shared
Services Agreement") executed by Xxxxxxxx, in form and substance satisfactory to
Purchaser.
9.10 Pledge and Rights Agreement. A pledge and rights agreement executed by
Xxxxxxxx, in form and substance satisfactory to Purchaser (the "Pledge and
Rights Agreement").
9.11 Wastewater Services Agreement. A wastewater services agreement (the
"Wastewater Services Agreement") for all of the Xxxxxxxx Facilities (except for
the Sacramento Facility) executed by Xxxxxxxx, in form and substance
satisfactory to Purchaser.
ARTICLE X
CLOSING DOCUMENTS TO BE DELIVERED BY PURCHASER
At the Closing, Purchaser shall deliver the following to Xxxxxxxx:
10.1 Opinion of Counsel. An opinion of Winthrop, Stimson, Xxxxxx & Xxxxxxx,
dated the Closing Date, in form and substance satisfactory to Xxxxxxxx.
10.2 Purchase Price. The Purchase Price (including the cash payment and the
Note executed by Purchaser), as required pursuant to Section 3.1.
10.3 Consents. Copies of the written consents and approvals listed on
Purchaser Disclosure Schedule 6.2.
10.4 Secretary's Certificate. A certificate of the Secretary or an
Assistant Secretary of Purchaser dated the Closing Date and certifying (i) that
attached thereto is a true, complete and correct copy of the By-laws of
Purchaser as in effect on the date of such certification, (ii) that attached
thereto is a true, complete and correct copy of the Certificate of
Incorporation, as amended, of Purchaser as certified as of a recent date by the
Secretary of State of Delaware (iii) that attached thereto are true, complete
and correct copies of the resolutions duly adopted by the Board of Directors of
Purchaser approving the transactions contemplated hereby and authorizing the
execution, delivery and performance by Purchaser of this Agreement and the
Purchaser Closing Documents, as in effect on the date of such certification, and
(iv) as to the incumbency and signatures of certain officers of Purchaser
executing any instrument or other document delivered in connection with such
transactions.
10.5 Further Instruments. Such further instruments of assumption or other
documents with respect to the transactions contemplated by this Agreement as
Xxxxxxxx may reasonably request.
10.6 Supply Agreement. The Supply Agreement executed by Purchaser and
Silgan, in form and substance satisfactory to Xxxxxxxx.
10.7 Leases. A Lease for each Xxxxxxxx Facility executed by Purchaser and
Silgan, in form and substance satisfactory to Xxxxxxxx.
10.8 Labor Supply Agreement. The Labor Supply Agreement and the Labor
Transfer Agreement executed by Purchaser and Silgan , in form and substance
satisfactory to Xxxxxxxx.
10.9 Shared Services Agreement. The Shared Services Agreement executed by
Purchaser, in form and substance satisfactory to Xxxxxxxx.
10.10 Pledge and Rights Agreement. The Pledge and Rights Agreement executed
by Silgan, Silgan Corporation and Purchaser, along with stock certificates
representing all of the outstanding capital stock of Purchaser and blank stock
powers executed by Silgan Corporation, all in form and substance satisfactory to
Xxxxxxxx.
10.11 Guaranty. A guaranty (the "Guaranty") in favor of Xxxxxxxx executed
by Silgan Holdings Inc., Silgan, Silgan Containers Manufacturing Corporation and
Silgan Corporation in form and substance satisfactory to Xxxxxxxx.
10.12 Wastewater Services Agreement. The Wastewater Services Agreement for
all of the Xxxxxxxx Facilities (except for the Sacramento Facility) executed by
Purchaser, in form and substance satisfactory to Xxxxxxxx.
10.13 Letter of Credit. The Letter of Credit.
ARTICLE XI
INDEMNIFICATION
11.1 By Xxxxxxxx. Subject to the limitations set forth in the balance of
this Article XI and subject to Section 13.4, Xxxxxxxx shall protect, defend,
indemnify and hold harmless Purchaser and its Affiliates (collectively, the
"Purchaser Indemnitees") from and against any and all demands, judgments,
injuries, penalties, fines, restitutions, monetary sanctions, damages, losses,
obligations, liabilities, claims, actions or causes of action, encumbrances,
costs and expenses (including, without limitation, reasonable attorneys' fees,
costs and expenses, reasonable expert witness and consulting fees and reasonable
costs of investigation and feasibility studies incurred in investigating and
defending against the assertion of any of the foregoing) (collectively,
"Damages") suffered, sustained, incurred or required to be paid by any Purchaser
Indemnitee directly arising out of or based upon or directly resulting from or
as a direct result of: (i) failure by Xxxxxxxx to discharge in full any Excluded
Liability, (ii) any breach by Xxxxxxxx of any of its representations or
warranties in this Agreement, (iii) a breach or nonfulfillment of any covenant
or undertaking of Xxxxxxxx contained in this Agreement, the Shared Services
Agreement or the Wastewater Services Agreement, (iv) to the extent required by
any Environmental Law as in effect as of the Closing Date or as ordered by any
governmental agency or court of competent jurisdiction, the Cleanup of any
Materials of Environmental Concern Released on, beneath or from any Xxxxxxxx
Facility (A) prior to the Closing Date, except to the extent, and only to the
extent, that such Release is caused, exacerbated or aggravated by any act or
omission on the part of Silgan, Purchaser, any of their Affiliates or any of
their respective employees or agents (including Provided Employees) or, after
the Closing Date and during the term of the Lease for such Xxxxxxxx Facility
(or, if applicable, until Purchaser vacates such Xxxxxxxx Facility), by any
other person (other than Xxxxxxxx, any of its Affiliates or any of their
respective employees (excluding Provided Employees) or agents), or (B) after the
Closing Date to the extent, and only to the extent, that such Release is caused,
exacerbated or aggravated by any act or omission on the part of Xxxxxxxx, any of
its Affiliates or any of their respective employees (excluding Provided
Employees) or agents, (v) except in respect of the Sacramento Action (as
hereinafter defined) or the CBE Action (as hereinafter defined) which are the
subject of Section 11.1(vii) below, any noncompliance with any Environmental Law
as in effect as of the Closing Date at any Xxxxxxxx Facility (A) prior to the
Closing Date, except to the extent, and only to the extent, that such
noncompliance is caused, exacerbated or aggravated by any act or omission on the
part of Silgan, Purchaser, any of their Affiliates or any of their respective
employees or agents (including Provided Employees) or, after the Closing Date
and during the term of the Lease for such Xxxxxxxx Facility (or, if applicable,
until Purchaser vacates such Xxxxxxxx Facility), by any other person (other than
Xxxxxxxx, any of its Affiliates or any of their respective employees (excluding
Provided Employees) or agents) , or (B) after the Closing Date, to the extent,
and only to the extent, that such non-compliance is exacerbated or aggravated by
any act or omission on the part of Xxxxxxxx, any of its Affiliates or any of
their respective employees (excluding Provided Employees) or agents, (vi) the
loss of life, injury to third-party property or person or damage to natural
resources caused by the actual, alleged or threatened Release, storage,
transportation, treatment or generation of Materials of Environmental Concern
on, at, beneath or from any Xxxxxxxx Facility (A) prior to the Closing Date,
except to the extent, and only to the extent, that such Release, storage,
transportation treatment or generation of Materials of Environmental Concern is
caused, exacerbated or aggravated by any act or omission on the part of Silgan,
Purchaser, any of their Affiliates or any of their respective employees or
agents (including Provided Employees) or, after the Closing Date and during the
term of the Lease for such Xxxxxxxx Facility (or, if applicable, until Purchaser
vacates such Xxxxxxxx Facility), by any other person (other than Xxxxxxxx, any
of its Affiliates or any of their respective employees (excluding Provided
Employees) or agents), or (B) after the Closing Date, to the extent, and only to
the extent, that such Release, storage, transportation, treatment or generation
of Materials of Environmental Concern is exacerbated or aggravated by any act or
omission on the part of Xxxxxxxx, any of its Affiliates or any of their
respective employees (excluding Provided Employees) or agents, or (vii) except
to the extent, and only to the extent, that the Damages arise from Purchaser's,
Silgan's, any of their Affiliates' or any of their respective employees' or
agents' (including Provided Employees') failure to comply with the May 1 Letter
to shut down the Three Piece Can Manufacturing Equipment (each as hereinafter
defined) by August 1, 2000 and not to exceed the annual three year emission
average of such equipment for the last three years (regardless of whether the
Sacramento Action is settled) (the "May 1 Letter Requirements") or any of
Purchaser's obligations under the Consent Decree or any other settlement
agreement entered into by Purchaser in respect of the actions described in Item
(iii) in Xxxxxxxx Disclosure Schedule 5.10 hereto (the "Sacramento Action") and
the action described in Item (vi) in Xxxxxxxx Disclosure Schedule 5.10 hereto
(the "CBE Action"), any claims, actions or causes of action based upon or
arising out of the matters covered by or described in the Sacramento Action or
the CBE Action (A) with respect to events occurring prior to the Closing Date
and, (B) with respect to events occurring from and after the Closing Date,
provided that Silgan, Purchaser, any of their Affiliates and their respective
employees have complied with the May 1 Letter Requirements, their obligations
under Sections 11.5(f)-(j) and, to the extent Purchaser, Silgan or any of their
Affiliates enter into the Consent Decree or any other settlement agreement,
their obligations under such Consent Decree or any other such settlement
agreement entered into by Silgan, Purchaser or any of their Affiliates in
respect of the Sacramento Action or CBE Action and have otherwise operated the
Three Piece Can Manufacturing Equipment at the Sacramento Facility consistent
with Campbell's practices during the three years prior to the Closing Date. As
used herein, the term "Provided Employees" means employees covered by the Labor
Supply Agreement to the extent such employees are performing activities under
the direction, control or supervision of Silgan, Purchaser or any of their
Affiliates. No Purchaser Indemnitee shall be entitled to any Damages under
Sections 11.1 (ii) and (iv)-(vi) for the Cleanup of any Materials of
Environmental Concern at the Facilities unless (i) the condition requiring such
Cleanup was set forth in Campbell's Environmental Reports or Purchaser's
Environmental Reports or (ii) such Purchaser Indemnitee shows by a preponderance
of the evidence that the condition requiring such Cleanup was caused,
exacerbated or aggravated by an act or omission on the part of Xxxxxxxx, any of
its Affiliates or any of their respective employees (other than, from and after
the Closing Date, the Provided Employees) or agents, or that the condition
requiring such Cleanup existed prior to the Closing Date. Xxxxxxxx may refute
any matter set forth in the Purchaser's Environmental Reports, provided,
however, that Xxxxxxxx shows by a preponderance of the evidence that such matter
did not exist prior to the Closing Date. Purchaser shall provide Xxxxxxxx and
its consultants, engineers and representatives with reasonable access to
personnel, records, documents and the applicable Xxxxxxxx Facility so they can
perform testing, evaluation and analysis as Xxxxxxxx deems necessary to confirm
or refute Purchaser's determination of whether such Environmental Claim,
non-compliance or condition requiring Cleanup is one for which Xxxxxxxx is
responsible as set forth above. In the event the parties cannot agree who is
responsible for such Cleanup of such condition because they do not agree when
such Environmental Claim, non-compliance or condition was created or who or what
caused such Environmental Claim, non-compliance or condition, the parties may,
upon mutual agreement, jointly select an environmental consultant or engineer,
as appropriate, with recognized environmental experience (the "Independent
Expert") to make such determinations. The determination of the Independent
Expert shall be final and binding (without any right of appeal) upon both such
parties. The Independent Expert shall be permitted to have reasonable access to
and to interview the parties' employees and representatives and to review all
available information, including Campbell's and Purchaser's environmental
reports, tests and studies and may propose such additional investigation,
testing, sampling, monitoring or whatever is necessary to resolve such dispute.
The fees of the Independent Expert shall be paid by each of the parties in
proportion to the amount payable by each party in respect of the Cleanup of such
condition, as determined by the Independent Expert.
11.2 By Purchaser and Silgan. Subject to the limitation set forth in the
balance of Article XI and subject to Section 13.4, Purchaser and Silgan shall
protect, defend, indemnify and hold harmless Xxxxxxxx and its Affiliates
(collectively, the "Xxxxxxxx Indemnitees") from and against any and all Damages
sustained, suffered or incurred by any Xxxxxxxx Indemnitee directly arising out
of or based upon or directly resulting from or as a direct result of: (i) any
Assumed Liability that is not timely discharged in full by Purchaser, (ii) any
breach by Purchaser of any of its representations or warranties in this
Agreement, (iii) (A) the conduct of the Business by Purchaser from and after the
Closing Date or the conduct of any other business by Purchaser, Silgan, any of
their Affiliates or any of their respective employees (including Provided
Employees) or agents at any Xxxxxxxx Facility except to the extent of Campbell's
indemnification obligations under Section 11.1 hereof; provided that, with
respect to any claim for indemnification under this Section (iii)(A) for damages
allegedly arising out of the conduct of the Business or any other business by
Purchaser, Silgan, any of their Affiliates or any of their respective employees
(including Provided Employees) or agents in violation of any Environmental Law,
the term "Environmental Laws" as used in this clause (iii) shall, at the end of
the time of the applicable Lease and at any time thereafter, mean Environmental
Laws as in effect as of the end of the term of the applicable Lease (or, if
applicable, until Purchaser vacates such Xxxxxxxx Facility) or (B) a breach or
nonfulfillment of any covenant or undertaking of Purchaser or Silgan contained
in this Agreement, the Shared Services Agreement, the Wastewater Services
Agreement or the ERC Agreements, (iv) to the extent required by any
Environmental Law or as ordered by any governmental agency or court of competent
jurisdiction, except to the extent of Campbell's indemnification obligations
under Section 11.1 hereof, (A) the Cleanup of any Materials of Environmental
Concern Released on, beneath or from any Xxxxxxxx Facility by Silgan, Purchaser,
any of their Affiliates or any of their respective employees (including Provided
Employees) or agents or any other person (other than Xxxxxxxx, any of its
Affiliates or any of their respective employees or agents) from and after the
Closing Date and until the end of the term of the Lease for such Xxxxxxxx
Facility (or, if applicable, until Purchaser vacates such Xxxxxxxx Facility), or
(B) the Cleanup of Materials of Environmental Concern Released on, beneath or
from any Xxxxxxxx Facility prior to the Closing Date to the extent, and only to
the extent, that such Release is caused, exacerbated or aggravated by any act or
omission on the part of Silgan, Purchaser, any of their Affiliates or any of
their respective employees (including Provided Employees) or agents, or after
the Closing Date until the end of the term of the Lease for such Xxxxxxxx
Facility (or, if applicable, until Purchaser vacates such Xxxxxxxx Facility) by
Silgan, Purchaser, any of their Affiliates or any of their respective employees
(including Provided Employees) or agents or by any other person (other than
Xxxxxxxx, any of its Affiliates or any of their respective employees or agents);
provided that, the term "Environmental Laws" as used in this clause (iv) shall,
at the end of the term of the applicable Lease and at any time thereafter, mean
Environmental Laws as in effect as of the end of the term of the applicable
Lease (or, if applicable, until Purchaser vacates such Xxxxxxxx Facility), (v)
any noncompliance with any Environmental Law at any Xxxxxxxx Facility from and
after the Closing Date (or, if applicable, until Purchaser vacates such Xxxxxxxx
Facility) by Silgan, Purchaser, any of their Affiliates or any of their
respective employees (including Provided Employees) or agents or from and after
the Closing Date and until the end of the term of the Lease for such Xxxxxxxx
Facility (or, if applicable, until Purchaser vacates such Xxxxxxxx Facility) by
any other person, except to the extent of Campbell's indemnification obligations
under Section 11.1 hereof and except to the extent, and only to the extent, that
such noncompliance is caused, exacerbated or aggravated by any act or omission
on the part of Xxxxxxxx, any of its Affiliates or any of their respective
employees or agents; provided that, the term "Environmental Laws" as used in
this clause (v) shall, at the end of the term of the applicable Lease and at any
time thereafter, mean Environmental Laws as in effect as of the end of the term
of the applicable Lease (or, if applicable, until Purchaser vacates such
Xxxxxxxx Facility), (vi) except to the extent of Campbell's indemnification
obligations under Section 11.1 hereof, the loss of life, injury to property or
person or damage to natural resources caused by the actual, alleged or
threatened Release, storage, transportation, treatment or generation of
Materials of Environmental Concern on, at, beneath or from any Xxxxxxxx Facility
(A) from and after the Closing Date by Silgan, Purchaser, any of their
Affiliates or any of their respective employees (including Provided Employees)
or agents or from and after the Closing Date and until the end of the term of
the Lease for such Xxxxxxxx Facility (or, if applicable, until Purchaser vacates
such Xxxxxxxx Facility) by any other person, except to the extent, and only to
the extent, that such Release, storage, transportation, treatment or generation
of Materials of Environmental Concern is caused, exacerbated or aggravated by
any act or omission on the part of Xxxxxxxx, any of its Affiliates or any of
their respective employees or agents, or (B) in respect of any actual, alleged
or threatened Release, storage, transportation, treatment or generation of
Materials of Environmental Concern occurring prior to the Closing Date, to the
extent, and only to the extent, caused by or exacerbated or aggravated by
Silgan, Purchaser, any of their Affiliates or any of their respective employees
(including Provided Employees) or agents, or after the Closing Date and during
the term of the Lease for such Xxxxxxxx Facility (or, if applicable, until
Purchaser vacates such Xxxxxxxx Facility), by any other person (other than
Xxxxxxxx, any of its Affiliates or any of their respective employees or agents)
and (vii) to the extent required by any Environmental Law or as ordered by any
governmental agency or court of competent jurisdiction, except to the extent of
Campbell's indemnification obligations under Section 11.1 hereof, the Cleanup of
any Materials of Environmental Concern identified in the environmental
investigation conducted by Purchaser pursuant to Section 15.2B of each of the
Leases (except for such Materials of Environmental Concern which Purchaser shows
by a preponderance of the evidence existed as of the Closing Date); provided
that, the term "Environmental Laws" as used in this clause (vii) shall, at the
end of the term of the applicable Lease (or, if applicable, until Purchaser
vacates such Xxxxxxxx Facility) and at any time thereafter, mean Environmental
Laws as in effect as of the end of the term of the applicable Lease. With
respect to the parties' indemnification obligations under Sections 11.1(iv)-(vi)
or 11.2(iv)-(vi) in respect of the matters described in Xxxxxxxx Disclosure
Schedule 11.2 hereto, if the parties are unable to reasonably determine what
portions of the condition existed before and after the Closing Date, then the
responsibility for any Damage resulting from such condition shall be allocated
between Xxxxxxxx, on the one hand, and the Purchaser, on the other hand, based
on the duration of each such party's respective use of the relevant equipment
during the time that it can be shown, by a preponderance of the evidence, that
such equipment was causing the relevant Release, or, if it can not be so shown,
based upon the duration of each such party's respective use of the relevant
equipment. For purposes of Section 11.2, the term "employee," with respect to
Xxxxxxxx or any of its Affiliates, excludes Provided Employees.
11.3 Defense. Except as set forth in Section 11.5(d) hereof, if any action,
suit or proceeding is commenced, or any claim or demand is asserted, by a third
party not Affiliated with any party hereto against a party hereto (the
"Indemnitee") in respect of which the Indemnitee proposes to demand
indemnification under Section 11.1 or 11.2 above, the party from which
indemnification is sought (the "Indemnitor") shall have the right to assume the
entire control thereof (including the selection of counsel reasonably acceptable
to the Indemnitee), subject to the right of the Indemnitee to participate (with
counsel of its choice reasonably acceptable to the Indemnitor but at the
Indemnitee's expense) in the defense, compromise or settlement thereof;
provided, however, if the claim or demand is one for which both parties hereto
are responsible, then both parties shall jointly assume the defense thereof with
counsel reasonably acceptable to each party, and neither party may compromise or
settle such claim or demand without the other party's consent, which consent
will not be unreasonably denied or withheld. The Indemnitee shall notify the
Indemnitor at the earliest practical time after the Indemnitee becomes aware of
the circumstance, event or activity which gives rise to the asserted obligation
of indemnity, it being understood that failure to provide such notice shall not
affect the Indemnitee's right to indemnification hereunder, except to the extent
the Indemnitor shall have been prejudiced as a result of such failure (and the
Indemnitor shall not be liable for any attorney fees or expenses incurred during
the period in which the Indemnitor shall have failed to give such notice). With
respect to any actions, suits, proceedings, claims or demands as to which the
Indemnitor shall not have exercised its right to assume the defense, the
Indemnitee shall assume and control the defense of and contest such action with
counsel chosen by it and approved by the Indemnitor, which approval shall not be
unreasonably withheld, in which case the Indemnitor shall be entitled to
participate in the defense of such action (the cost of such participation to be
at its own expense) and the Indemnitor shall be obligated to pay the reasonable
attorneys' fees and expenses of the Indemnitee to the extent that such fees and
expenses relate to claims as to which indemnification is due under this Article
XI and subject to the limitations contained in this Agreement. Both the
Indemnitor and the Indemnitee shall cooperate fully in all respects with one
another in any such defense, compromise or settlement, including, without
limitation, by making available to the other all pertinent information and
personnel under its direct or indirect control, and the parties agree that such
cooperation will be carried out in a way so as not to waive any applicable or
available attorney-client privilege, and the parties will take all measures to
protect such privilege. Neither party shall compromise or settle any such
action, suit, proceeding, claim or demand without prior written consent of the
other party, which consent shall not be unreasonably withheld or delayed,
provided, however, that a party may so compromise or settle, after consultation
with the other party, (i) if such compromise or settlement involves solely the
payment of money damages and/or the granting of releases, provided that no such
compromise, settlement or release shall acknowledge liability for future acts or
obligate any Xxxxxxxx Indemnitee with respect to any post-Closing activities of
the Business or, except for the Assumed Liabilities, obligate any Purchaser
Indemnitee with respect to any pre-Closing activities of the Business, (ii) if
all claimants provide a release (reasonably acceptable to such Indemnitees) in
favor of Indemnitees, and (iii) if all claimants agree in writing to maintain
the facts and circumstances of the settlement confidential to the extent
permitted by applicable law). This Section 11.3 shall not apply to direct claims
of any Xxxxxxxx Indemnitee against Purchaser or Silgan or of any Purchaser
Indemnitee against Xxxxxxxx, that are not based upon claims asserted by third
parties.
11.4 Taxes. Liabilities for any Taxes and related Encumbrances are within
the scope of this Article XI. With respect to Tax issues that an Indemnitor
desires to contest where such issues must be combined with issues relating to
Taxes that are not the responsibility of the Indemnitor, both parties shall
cooperate fully. In the event of an audit or contest with Taxing authorities
relating to Taxes as to which one party is responsible, such party shall be
solely responsible for conducting such audit or contest and shall have the right
to control and make all decisions regarding such audit or contest, including the
settlement and the selection of a forum for contest; provided, however, that
such party may not settle such contest or audit, or otherwise conduct such
contest or audit, in a manner that would have a material adverse effect on the
other party with respect to the Business without the other party's prior written
consent, which shall not be unreasonably withheld. Notwithstanding anything
herein to the contrary, to the extent that any contest by either party of any
Tax issue results in an Encumbrance on any of the other party's property or
assets, the contesting party shall promptly take all action to remove such
Encumbrance.
11.5 Certain Other Limitations.
(a) The rights of the Purchaser Indemnitees to indemnification
by Xxxxxxxx pursuant to Section 11.1(ii) shall be subject to the limitations
that (i) they shall not be entitled to indemnification with respect to an
individual matter unless and until the amount of Damages with respect to such
individual matter exceeds $10,000, (ii) they shall not be entitled to
indemnification unless the aggregate Damages with respect to all such claims
exceeds $2,000,000, in which event, subject to clause (iii) below, the
indemnification provided for in Section 11.1(ii) shall be effective only with
respect to the amount of such Damages which exceeds $2,000,000 and (iii) the
maximum amount of Campbell's indemnification obligation thereunder shall not
exceed an aggregate of $15,000,000. The rights of the Xxxxxxxx Indemnitees to
indemnification by Purchaser and/or Silgan pursuant to Section 11.2(ii) shall be
subject to the limitations that (i) they shall not be entitled to
indemnification with respect to an individual matter unless and until the amount
of Damages with respect to such individual matter exceed $10,000, (ii) they
shall not be entitled to indemnification unless the aggregate Damages with
respect to all such claims exceed $2,000,000, in which event, subject to clause
(iii) below, the indemnification provided for in Section 11.2(ii) shall be
effective only with respect to the amount of such Damages which exceeds
$2,000,000, and (iii) the maximum amount of Purchaser's indemnification
obligation thereunder shall not exceed $15,000,000.
(b) Except as otherwise expressly provided in this Article XI,
each of the parties acknowledge and agree that the other party shall not have
any liability under any provision of this Agreement for any Damage to the extent
that such Damage directly relates to actions taken or omitted to be taken by
such party or its Affiliates. Each of the parties agrees to take, and to cause
their Affiliates to take, all reasonable steps to mitigate any Damages upon
becoming aware of any event which, given the circumstances at the time, would
reasonably be expected, or does, give rise thereto.
(c) Each of the parties hereto acknowledges that the other
party's indemnification obligations, as described in this Article XI, are
intended to be the exclusive remedies of such party pursuant to this Agreement
or otherwise in connection with the transactions covered by this Agreement and
that such remedies, as so limited and as subject to the expiration periods for
the representations and warranties set forth in Section 13.4, are intended to
supersede and preempt any and all remedies (in law or equity) which such party
may have against the other party and its Affiliates pursuant to this Agreement
or otherwise in connection with the transactions covered by this Agreement
(whether for tort or for breach of contract or of representation, warranty,
covenant or otherwise) pursuant to any applicable statute, regulation, case law,
public policy or otherwise. Nothing contained herein shall affect or otherwise
limit Campbell's or Purchaser's remedies under any other agreement, document or
instrument delivered pursuant hereto, including, without limitation, the Supply
Agreement, the Leases or the Labor Supply Agreement. Each of the parties hereto
expressly waives the benefit of any such applicable statute, regulation, case
law or public policy and acknowledges that its remedies set forth in this
Agreement, as so limited, provide such party with a reasonable remedy. The
parties acknowledge that the indemnification limits and expiration periods set
forth in this Agreement are a material element of this Agreement and that the
Purchase Price would have been substantially higher if any of those limits and
periods were not strictly enforced.
(d) To the extent Purchaser is entitled to any Damages for the
Cleanup of Materials of Environmental Concern at any of the Xxxxxxxx Facilities,
whether under this Agreement, the Leases or the Wastewater Services Agreement,
Xxxxxxxx shall control the Cleanup (including, without limitation, the sole
right to negotiate with governmental agencies or other interested parties and to
develop and implement the Cleanup plan), and Xxxxxxxx shall only be required to
perform such Cleanup to the Cleanup level required by all applicable
Environmental Laws for the current use of the applicable Xxxxxxxx Facility or,
if more stringent, to the Cleanup level required by any governmental agency
(after exhaustion of all relevant appeals or as consented to by the relevant
party) for the current use of the applicable Xxxxxxxx Facility (the "Cleanup
Standard"). Notwithstanding the foregoing, any such Cleanup shall be performed
so as to minimize to the extent possible any interference with Purchaser's
operations at the applicable Xxxxxxxx Facility. To the extent Xxxxxxxx is
entitled to any Damages for the Cleanup of Materials of Environmental Concern at
any of the Xxxxxxxx Facilities, whether under this Agreement, the Leases or the
Wastewater Services Agreement, Xxxxxxxx shall have the right, at its sole
discretion, to control the Cleanup (including, without limitation, the sole
right to negotiate with governmental agencies or other interested parties and to
develop and implement the Cleanup plan), and Purchaser and Silgan shall only be
required to perform or, if performed by Xxxxxxxx, to pay for such Cleanup to the
extent required to restore the Xxxxxxxx Facility to its condition existing prior
to the presence of such Materials of Environmental Concern or the Cleanup
Standard, whichever is more stringent; provided, however, if Xxxxxxxx is
controlling the Cleanup, Purchaser and Silgan shall only be required to pay for
the reasonably necessary out-of-pocket costs, expenses and charges paid by
Xxxxxxxx to third party contractors, consultants, engineers or other
professionals or governmental authorities (such as for permitting fees or
oversight costs) for the foregoing. Purchaser covenants that neither it nor
anyone acting on its behalf or in connection with a business relationship with
it will initiate any discretionary environmental investigation of any of the
Xxxxxxxx Facilities. Any environmental investigation shall not be considered
discretionary if it responds to conditions discovered (i) during the normal
day-to-day operations of the Xxxxxxxx Facilities or in connection with any
Xxxxxxxx Facility expansion or renovation and reporting or investigation of such
condition is required by a specifically applicable provision of Environmental
Law, (ii) if the investigation is in response to a governmental order, decree,
notice, suit or proceeding or instruction, (iii) if the investigation is in
response to any claim for personal injury or property damage resulting from such
alleged environmental condition, or (iv) the investigation arises out of or
relates to a reasonable and material concern about safety, health or the
environment. Notwithstanding the foregoing, non-invasive environmental
compliance audits conducted by Purchaser in the ordinary course of business
shall not be deemed a "discretionary environmental investigation" under this
subsection (d). Purchaser shall give Xxxxxxxx reasonable written notice prior to
conducting any environmental investigation under Sections 11.5(d)(ii)-(iv)
above.
(e) Notwithstanding anything herein to the contrary, neither
Purchaser or Silgan nor Xxxxxxxx shall be liable to, or shall indemnify, any
Xxxxxxxx Indemnitee or Purchaser Indemnitee, as the case may be, for any
consequential, special or punitive damages of such Xxxxxxxx Indemnitee or
Purchaser Indemnitee, as the case may be.
(f) With respect to the Sacramento Action:
(i) Purchaser, Silgan and Xxxxxxxx will cooperate in good
faith with each other to negotiate and enter into a Consent Decree
("Consent Decree"), which will contain, among other things, terms
consistent with the letter provided by Purchaser to Xxxxxxx Xxxxxxx,
attorney for the Untied States Department of Justice dated May 1, 1998
("May 1 Letter"). Neither Silgan, Purchaser, nor any of their
Affiliates are required to enter into any consent decree (including,
without limitation, the Consent Decree) or any other settlement
agreement which contains terms inconsistent with or more onerous than
the May 1 Letter.
(ii) Nothing in Article XI is intended to provide any
Indemnitee with indemnification for fines, penalties and the costs
arising from any violation by such Indemnitee of the terms of the
Consent Decree, and any such fines, penalties or costs arising from
such Indemnitee's failure to comply with the Consent Degree shall be
such Indemnitee's sole costs and expense.
(iii) If Xxxxxxxx decides, in its sole discretion, to
litigate the Sacramento Action, or the Sacramento Action cannot be
amicably resolved for any other reason, Purchaser shall nevertheless
comply with the May 1 Letter Requirements, and Purchaser shall
cooperate in all reasonable respects and in good faith with Xxxxxxxx in
the litigation of the Sacramento Action.
(iv) Purchaser will cooperate in good faith to facilitate
Campbell's efforts to apply for and obtain ERCs (as defined below) with
respect to the Three Piece Can Manufacturing Equipment, including but
not limited to providing all information reasonably required and
executing the ERC Assignment and Cooperation Agreement for Shutdown
Credits and the ERC Assignment and Cooperation Agreement for Control or
Conversion Credits promptly after the Closing Date, each among
Purchaser, Xxxxxxxx and Silgan (collectively, "ERC Agreements").
(g) With respect to the CBE Action, Purchaser, Silgan and
Xxxxxxxx shall cooperate in all reasonable respects and in good faith with each
other in the litigation of the CBE Action and in connection with efforts to
resolve the CBE Action amicably. Purchaser agrees to enter into a consent decree
or other agreement to settle the CBE Action with Xxxxxxxx upon terms mutually
agreeable to Purchaser and Xxxxxxxx consistent with the terms in the first draft
of the Consent Decree (designated as "US Draft May 20, 1998") (the "Draft
Consent Decree") and the May 1 Letter. If Xxxxxxxx decides, in its sole
discretion, to litigate the CBE Action, or the CBE Action cannot be amicably
resolved for any other reason, Purchaser shall nevertheless comply with the May
1 Letter Requirements, and Purchaser and Silgan shall cooperate in all
reasonable respects and in good faith with Xxxxxxxx in the litigation of the CBE
Action.
(h) Xxxxxxxx shall have sole control and final decision-making
authority over the handling of the Sacramento Action and the CBE Action and the
negotiations and entering into of any settlement over the Sacramento Action and
CBE Action, except, with respect to any portion of the Sacramento Action or CBE
Action that may be asserted after the date hereof, if both of the following
conditions are met: (i) Silgan, Purchaser or any of their Affiliates are solely
liable for such portion of the applicable action, and (ii) such portion of the
applicable action is not subject to the indemnification obligations of Xxxxxxxx
pursuant to Section 11.1. If Xxxxxxxx does not have such sole control and final
decision making authority over such portion as a result of the condition in (i)
and (ii) of this Section 11.5(h) having been met, Xxxxxxxx shall gain such right
to control and exercise authority if Xxxxxxxx agrees in writing to indemnify in
full all Purchaser Indemnitees with respect to the portion of the Sacramento
Action and/or the CBE Action for which Silgan, Purchaser or any of their
respective Affiliates may be liable or responsible. To exercise sole control and
final decision-making authority shall include but not be limited to (i)
conducting the defense of litigation, (ii) the timing, methods and substance of
communications with the Environmental Protection Agency ("EPA") and the United
States Department of Justice ("Justice") concerning the Sacramento Action and
with the claimants (and EPA and/or Justice, if necessary) regarding the CBE
Action, (iii) subject to the following two sentences of this paragraph (h), the
communication with the public and press concerning the Sacramento Action and CBE
Action and settlement thereof, and (iv) whether to settle the Sacramento Action
and/or the CBE Action or litigate either such action; provided, however, that
Xxxxxxxx agrees to consult with Purchaser in good faith concerning all such
issues in advance, and provided further that Xxxxxxxx and Silgan will jointly
meet with representatives of the EPA and Justice to negotiate the Consent Decree
and to refine and work out the details of Silgan's obligations in the May 1
Letter. The parties will work together and jointly formulate any press release
or public statements or responses that will be issued regarding the settlement
or status of the Sacramento Action and CBE Action. Neither party will issue a
press release or standby statement without it first being approved by the other
party. To the extent that any communications with the EPA, Justice or the
claimants regarding the Sacramento Action or CBE Action are reasonably likely to
involve any matters affecting the other party or any of their respective
Affiliates, the party communicating shall inform the other party and permit such
party to participate in such communications.
(i) (i) In accordance with the terms of the ERC Agreements,
all emission reduction credit ("ERCs") on account of the shutdown or conversion
(if permitted by EPA and SMAQMD, as hereinafter defined) of the side seam stripe
equipment, roller coaters and compound applicators, solvents and compounds used
in relation thereto at the Sacramento Facility (herein the "Three Piece Can
Manufacturing Equipment") shall be the property of Xxxxxxxx. Each of Purchaser,
Silgan and all of their Affiliates assign to Xxxxxxxx all right, title and
interest that Silgan, Purchaser or any of their Affiliates has or may have to
apply for or own such credits, and shall, at no charge to Xxxxxxxx, execute any
additional documents necessary to effect such transfer or assignment to Xxxxxxxx
of such ERCs or the right to apply for such ERCs.
(ii) In order to facilitate the timely application
by Xxxxxxxx for ERCs, Purchaser shall, no fewer than ninety (90) days prior to
the anticipated date of permanent shutdown of any of the Three Piece Can
Manufacturing Equipment, provide Xxxxxxxx with written notice of such
anticipated date of shutdown. Thereafter, Purchaser shall promptly provide
Xxxxxxxx with written notice of any change in the anticipated date of shutdown
of such item of Three Piece Can Manufacturing Equipment, and shall notify
Xxxxxxxx in writing immediately upon the actual permanent shutdown of such item
of Three Piece Can Manufacturing Equipment. Silgan and Purchaser shall, upon
Campbell's request, execute any document reasonably necessary to assist or
enable Xxxxxxxx in presenting to the Sacramento Metropolitan Air Quality
Management District ("SMAQMD") a complete and timely application for ERCs.
(iii) It is agreed that the measure of damages that
Xxxxxxxx would incur, in the event that it is unable to obtain ERCs from the
shutdown of any compound applicator or from the discontinuance of the use of
dibasic ester on account of any failure by Purchaser or Silgan to perform their
obligations under Sections 11.5 (f)(iv) and 11.5 (i)(i)-(ii) hereof would be
difficult or impossible to ascertain. Accordingly, Silgan and Purchaser shall
pay to Xxxxxxxx, as liquidated damages and not as a penalty, the sum of $20,000
for each ton of ERCs that Xxxxxxxx is unable to obtain as a result of such
failure by Purchaser or Silgan to perform their obligations under the
above-referenced sections. The parties will use their reasonably best efforts to
agree on the number of credits that would have been issued but for Purchaser's
or Silgan's failure to perform their obligations, and if the parties cannot so
agree, the parties will resolve such dispute in accordance with Section 11.1
hereto.
(j) Silgan shall permanently cease operation of the Three
Piece Can Manufacturing Equipment by July 31, 2000 at the latest. Silgan shall
not commence operation of any Three Piece Can Manufacturing Equipment at any
time at any location that, by virtue of its proximity to the Sacramento
Facility, would disqualify Xxxxxxxx from obtaining ERCs otherwise available on
account of the shutdown at the Sacramento Facility of the Three Piece Can
Manufacturing Equipment including existing compound applicators and the
discontinuance at the Sacramento Facility of the current use of dibasic ester or
would cause a breach of the Consent Decree.
(k) Silgan shall bear sole responsibility for payment of
stipulated penalties pursuant to the provision set forth in paragraph 11 of the
Draft Consent Decree (or the corresponding section in the final Consent Decree,
when entered) that accrue as a result of Silgan's breach of its obligations
under the ERC Agreements or Sections 11.5(f)(iv) and 11.5(i)(i)-(ii). So long as
Silgan is not in breach of its obligations under the ERC Agreements or Sections
11.5(f)(iv) and 11.5(i)(i)-(ii), Xxxxxxxx shall bear sole responsibility for
payment of stipulated penalties pursuant to the provision set forth in paragraph
11 of the Draft Consent Decree (or the corresponding section in the final
Consent Decree, when entered) that accrue on account of Campbell's failure to
present timely and adequate applications for ERCs, where such failure results in
penalties under paragraph 11 of the Draft Consent Decree (or the corresponding
section in the final Consent Decree, when entered).
(l) Notwithstanding anything in this Article XI or elsewhere
in this Agreement to the contrary, no party's remedies in connection with the
transactions contemplated by this Agreement and the other agreements, documents
and instruments delivered pursuant hereto shall be in any way limited by the
provisions, restrictions or limitations contained in this Agreement or
otherwise, in the event of fraud by the party against whom remedies are sought.
11.6 Reduction of Indemnification. Notwithstanding any other provision of
this Agreement, the amount of indemnification payable by Purchaser and/or Silgan
to any Xxxxxxxx Indemnitee or by Xxxxxxxx to any Purchaser Indemnitee with
respect to a claim for indemnification under this Agreement shall be reduced
(dollar for dollar) by (i) the amount of proceeds received by such Xxxxxxxx
Indemnitee or Purchaser Indemnitee, as the case may be, from insurance in
respect of such claim for indemnification, (ii) any amounts received by the
Purchaser Indemnitee or Xxxxxxxx Indemnitee, as the case may be, in respect of
such claim pursuant to any indemnification by or indemnification agreement with
any third party, and (iii) an amount equal to the actual Tax benefit, if any,
received by the Purchaser Indemnitee or Xxxxxxxx Indemnitee, as the case may be
(through a Tax refund or reduction in Taxes otherwise due), that is directly
attributable to such claim. If the amount to be netted hereunder from any
payment required under Sections 11.1 or 11.2 is determined after payment by the
Indemnitor of any amount otherwise required to be paid to an Indemnitee pursuant
to this Article XI, the Indemnitee shall repay to the Indemnitor, promptly after
such determination, any amount that the Indemnitor would not have had to pay
pursuant to this Section 11.6 had such determination been made at the time of
such payment. Indemnitees shall exercise reasonable efforts to collect any such
insurance or indemnification.
ARTICLE XII
BROKERAGE AND FINDERS' FEES
Xxxxxxxx and Purchaser represent to, and agree with, each
other that no broker or finder has been involved in any manner in the
negotiation or consummation of the transactions contemplated by this Agreement
other than Chase Securities Inc. on behalf of Xxxxxxxx. Xxxxxxxx agrees to
indemnify and save the Purchaser Indemnitees harmless from and against any and
all claims, liabilities and obligations with respect to brokerage or finders'
fees or commissions in connection with the transactions contemplated by this
Agreement asserted by any person on the basis of any statement or representation
made or alleged to have been made by Xxxxxxxx or any Affiliate, including the
fees due Chase Securities Inc. Purchaser agrees to indemnify and save the
Xxxxxxxx Indemnitees harmless from and against any and all claims, liabilities
or obligations with respect to brokerage or finders' fees or commissions in
connection with the transactions contemplated by this Agreement asserted by any
person or persons on the basis of any statement or representation made or
alleged to have been made by Purchaser or any Affiliate of Purchaser.
ARTICLE XIII
MISCELLANEOUS
13.1 Expenses; Prorations. Each of the parties to this Agreement shall bear
all the expenses incurred by it in connection with the negotiation and
preparation of this Agreement and the consummation of the transactions
contemplated by this Agreement regardless of whether this Agreement shall be
terminated. Notwithstanding the foregoing: (a) stock transfer taxes and stamp
duties relating to the transfer of the Shares to Purchaser shall be paid by
Purchaser and (b) any sales, use, transfer, stamp, recording, value added and
other like Taxes which may be payable upon the transfer of the Xxxxxxxx Assets
to Subsidiary shall be shared and paid equally by Purchaser and Xxxxxxxx.
Purchaser and Xxxxxxxx agree to use all commercially reasonable means to
minimize any Taxes payable pursuant to the prior sentence. All personal property
Taxes and other Taxes (except for Taxes measurable or measured in whole or in
part by net or gross income or receipts) relating to the Xxxxxxxx Assets and all
utilities and rental and service charges relating to the Xxxxxxxx Assets or the
Xxxxxxxx Facilities will be prorated as of 12:00 a.m. on the Closing Date. Each
party shall promptly pay (or reimburse the other party for) all amounts for
which it is responsible under this Section 13.1.
13.2 Risk of Loss. Subject to the balance of this Section 13.2, the risk of
any loss, damage, impairment, confiscation or condemnation of the Xxxxxxxx
Assets or any part thereof shall be upon Xxxxxxxx at all times before the
Closing. In any such event, the proceeds of, or any claim for any loss payable
under, any Xxxxxxxx insurance policy, judgment or award with respect thereto
shall be payable to Xxxxxxxx or Subsidiary, which at Campbell's election shall
either (a) repair, replace or restore any such property as soon as possible
after the loss, impairment, confiscation or condemnation or (b) if insurance
proceeds are insufficient to repair, replace or restore the property, pay such
proceeds to Purchaser. Xxxxxxxx shall exercise reasonable efforts to maintain
its insurance coverages in effect on the date hereof which insure the Xxxxxxxx
Assets or any part of the Xxxxxxxx Assets. Xxxxxxxx shall have no obligation
with respect to any uninsured loss, damage, impairment, confiscation or
condemnation or the uninsured portion of any loss, damage, impairment,
confiscation or condemnation, which in the aggregate does not constitute a
Material Adverse Effect.
13.3 Further Assurances. At any time and from time to time after the
Closing, Xxxxxxxx shall, upon the request of Purchaser, and Purchaser shall,
upon the request of Xxxxxxxx, perform, execute, acknowledge and deliver all such
further acts, deeds, easements, assignments, transfers, conveyances, powers of
attorney and assurances as may be reasonably required by Purchaser or Xxxxxxxx,
as the case may be, to effect or evidence the transfer to and possession by
Purchaser of the Shares, the Transfer to Subsidiary of the Xxxxxxxx Assets, the
Assignment and the other transactions contemplated hereby. Additionally, after
the Closing, Xxxxxxxx shall reasonably cooperate, at Purchaser's expense, with
Purchaser to assist Purchaser in obtaining or making all permits, approvals,
authorizations, licenses, registrations and filings to enable Purchaser to
operate the Business as operated by Xxxxxxxx.
13.4 Survival. The representations and warranties of Xxxxxxxx and Purchaser
in this Agreement and any instruments used to effect the transfer of the Shares
to Purchaser shall survive the Closing and shall remain effective for a period
of two (2) years following the Closing Date. After the expiration of the
relevant period, such representations and warranties shall expire and be of no
further force and effect, and no indemnity shall be due with respect to any
breach thereof unless a written notice specifying the nature and amount of the
claim or claims shall have been delivered by a Purchaser Indemnitee or Xxxxxxxx
Indemnitee, as the case may be, with respect thereto on or before the expiration
of such relevant period.
13.5 Applicable Law. This Agreement shall be construed and enforced in
accordance with the internal laws of the State of New York, without giving
effect to the conflict of law provisions thereof.
13.6 Attorneys' Fees. If either party seeks to enforce any of its rights
under this Agreement (whether by formal proceedings or otherwise) or seeks a
declaration of any its rights of this Agreement, the party that substantially
prevails shall be entitled to reimbursement of all of its reasonable attorneys'
fees, costs and expenses by the party that does not substantially prevail.
13.7 Notices. All notices, demands, requests and other communications
required or permitted to be given under this Agreement shall be deemed duly
given five Business Days after mailing if mailed by certified or registered
mail, postage prepaid, on the date of delivery if delivered personally, on the
date sent if delivered by fax, with receipt confirmed, and one Business Day
after the date of deposit with a nationally recognized overnight courier, but
subject to the subsequent designation in writing of another address in
accordance with this Section 13.7, addressed as follows:
If to Purchaser:
Silgan Holdings Inc.
0 Xxxxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxx, Xxxxxxxxxxx 00000
Attention: D. Xxxx Xxxxxxxx
Fax No.: (000) 000-0000
With a copy to:
Silgan Holdings Inc.
0 Xxxxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxx, Xxxxxxxxxxx 00000
Attention: Xxxxx X. Xxxxx
Fax No.: (000) 000-0000
If to Xxxxxxxx:
Xxxxxxxx Soup Company
Xxxxxxxx Xxxxx
Xxxxxx, Xxx Xxxxxx 00000-0000
Attention: Corporate Secretary
Fax No.: (000) 000-0000
With a copy to:
Xxxxxxxx Soup Company
Xxxxxxxx Xxxxx
Xxxxxx, Xxx Xxxxxx 00000-0000
Attention: General Counsel
Fax No.: (000) 000-0000
13.8 Headings And Context. The section and paragraph headings contained in
this Agreement are for convenience only and do not form a part of this Agreement
or in any way modify or affect the meaning of this Agreement. Unless the context
requires otherwise, the use of the singular of a term in this Agreement includes
the plural, and the use of the plural includes the singular.
13.9 Counterparts. This Agreement may be executed in counterparts, all of
which shall be considered one and the same agreement, and shall become effective
when at least one counterpart has been signed by each of the parties and
delivered to the other party.
13.10 Benefits. This Agreement shall be binding upon and shall inure to the
benefit of the parties to this Agreement and their successors and permitted
assigns. Nothing in this Agreement shall be construed to create any rights in
third parties as third party beneficiaries or otherwise. This Agreement shall
not be assigned by any party without the prior written consent of the other
party, except that either party to this Agreement may transfer or assign this
Agreement to any Affiliate of such party upon any merger, consolidation, sale of
all or substantially all of the assets of such party or other similar business
combination with or to such Affiliate of such party without the prior written
consent of the other party. No assignment of this Agreement shall relieve the
assigning party of its obligations under this Agreement.
13.11 Amendment and Waiver. This Agreement may be amended, and any
provision of this Agreement may be waived, provided that any such amendment or
waiver will be binding on a party only if it is set forth in a writing signed by
that party. The waiver by any party of a breach of any provision of this
Agreement shall not operate or be construed as a waiver of any other breach.
13.12 Entire Agreement. This Agreement, including its Schedules and
Exhibits, contain all of the terms agreed upon by the parties with respect to
its subject matter and supersedes any and all prior and contemporaneous
agreements, representations and warranties of the parties regarding that subject
matter.
13.13 Limitation on Seller's Representations. Except as contemplated by
Section 7.8 hereof, Purchaser acknowledges and agrees that it has had adequate
opportunity prior to the Closing to investigate and inspect the condition of the
Xxxxxxxx Assets, and, except for the representations, warranties, covenants and
indemnities made by Xxxxxxxx in this Agreement, Purchaser is acquiring the
Xxxxxxxx Assets in their "AS IS, WHERE IS CONDITION WITH ALL FAULTS, INCLUDING
BUT NOT LIMITED TO BOTH LATENT AND PATENT DEFECTS." EXCEPT AS EXPRESSLY SET
FORTH IN THIS AGREEMENT, NO WARRANTIES, EXPRESS OR IMPLIED, ARE MADE BY XXXXXXXX
OR ANY OF ITS AFFILIATES CONCERNING THE XXXXXXXX ASSETS, INCLUDING BUT NOT
LIMITED TO, WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE.
Purchaser has investigated and has knowledge of operative or proposed
governmental laws and regulations, including, without limitation, Environmental
Laws, to which the Xxxxxxxx Assets are or may be subject, and Purchaser is
purchasing the Shares upon the basis of its review and determination of the
applicability and effect of such laws and regulations and the representations,
warranties, covenants and indemnities made by Xxxxxxxx in this Agreement. Except
as otherwise expressly set forth in this Agreement (including the disclosure
schedules with respect thereto), Purchaser acknowledges that Xxxxxxxx expressly
disclaims any representations or warranties of any kind or nature, express or
implied, as to the condition, value or quality of the Xxxxxxxx Assets. Purchaser
further acknowledges that neither Xxxxxxxx nor any other person has made any
representation or warranty, expressed or implied, as to the accuracy or
completeness of any information regarding Xxxxxxxx, the Xxxxxxxx Assets or the
Assumed Liabilities not included in this Agreement, and, except with respect to
the representations and warranties contained herein, neither Xxxxxxxx nor any
other person will have or be subject to any liability to Purchaser or any other
person resulting from the distribution to Purchaser or its representatives
(including, without limitation, its counsel, accountants, or advisors), or
Purchaser's use of, any information not included in this Agreement, including,
without limitation, the confidential offering memorandum prepared by Chase
Securities, Inc. relating to Xxxxxxxx, the Xxxxxxxx Assets or the Assumed
Liabilities, any other offering memorandum, brochure or other publication or any
business plan, projections, estimates, or budgets heretofore delivered to or
made available to Purchaser or its representatives (including, without
limitation, its counsel, accountants, or advisors) of future revenues, expenses
or expenditures, or future results of operations relating to the Xxxxxxxx
Assets, or any other document or information provided to Purchaser or its
representatives (including, without limitation, its counsel, accountants, or
advisors) in connection with the Xxxxxxxx Assets or the Assumed Liabilities and
not included in this Agreement. Notwithstanding anything to the contrary herein,
Xxxxxxxx makes no representation or warranty with respect to Year 2000
compliance of the Xxxxxxxx Assets, including but not limited to (a) the ability
of the Xxxxxxxx Assets to accurately process date data without error from, into
and between any of the twentieth century (through year 1999), the year 2000 and
the twenty-first century, and (b) the effect of the date change from 1999 to
2000 and beyond on the operation of the Business, including, but not limited to,
the functioning of the business as a going concern, and the Year 2000 compliance
(as herein described) of the Business's suppliers.
13.14 Bulk Transfer Laws. Purchaser waives compliance by Xxxxxxxx with the
provisions of any bulk sales or similar law, if and to the extent applicable to
the transactions contemplated hereby, and Xxxxxxxx agrees to protect, defend,
indemnify and hold harmless the Purchaser Indemnitees from and against any and
all Damages which may be suffered, sustained or incurred as a direct result of
failure to comply with any such laws.
13.15 Campbell's Knowledge. The term "knowledge," when used with respect to
Xxxxxxxx, shall mean the actual knowledge possessed by officers and employees of
Xxxxxxxx involved in the negotiation of the transactions contemplated by this
Agreement at the time the relevant representation or warranty is made or deemed
made.
13.16 Construction; Interpretation. References in this Agreement to dollar
amount thresholds shall not, for purposes of this Agreement, be deemed to be
evidence of materiality or a Material Adverse Effect. If any provision, clause
or part of this Agreement, or the application thereof under certain
circumstances, is held invalid or unenforceable, the remainder of this
Agreement, or the application of such provision, clause or part under other
circumstances, shall not be affected thereby.
13.17 Limitations on Disclosure of Information. Notwithstanding anything to
the contrary contained herein and except to the extent required by applicable
law or appropriate legal process, each of Xxxxxxxx and Purchaser may, in its
sole discretion, deny or restrict access of the other party to any books,
records or other documents, which would involve breaches of applicable
confidentiality agreements with third parties or possible waivers of any
applicable attorney-client privileges.
IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
signed and delivered as of the date that appears in the first paragraph of this
Agreement.
XXXXXXXX SOUP COMPANY
By: /s/ Xxxxxx X. Xxxxxxxx
---------------------------------------------
Name: Xxxxxx X. Xxxxxxxx
Title: Vice President - Business
Development
SILGAN CONTAINERS CORPORATION
By: /s/ Xxxxx X. Xxxxx, III
---------------------------------------------
Name: Xxxxx X. Xxxxx, III
Title: Vice President, General Counsel
and Secretary
SILGAN CAN COMPANY
By: /s/ Xxxxx X. Xxxxx, III
--------------------------------------------
Name: Xxxxx X. Xxxxx, III
Title: Vice President, General Counsel
and Secretary
