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EXHIBIT 2.3
STOCK PURCHASE AND SALE AGREEMENT
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This STOCK PURCHASE AND SALE AGREEMENT ("Agreement") made as of this 30th
day of September, 1996 between PRIMARK CORPORATION ("Seller"), a Michigan
corporation and the sole shareholder of PRIMARK STORAGE LEASING CORPORATION
("Company"), a Michigan corporation, and AMERICAN NATURAL RESOURCES COMPANY
("Buyer"), a Delaware corporation.
WITNESSETH:
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WHEREAS, Seller is the legal and beneficial holder of all of the presently
issued and outstanding shares of capital stock of the Company (the "Shares");
and
WHEREAS, Buyer desires to acquire from Seller, and Seller desires to sell,
transfer and assign to Buyer, all of the Shares of the Company subject to the
provisions, terms and conditions hereof.
NOW, THEREFORE, in consideration of their mutual covenants, agreements,
representations and warranties herein contained and subject to the terms and
conditions herein, the Parties hereto do hereby mutually agree as follows:
ARTICLE 1A
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DEFINITIONS
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The term "Agreement" shall have the meaning ascribed to it in the first
paragraph hereof.
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The term "Affiliate" shall mean as to a Person specified, any Person that
directly, or indirectly through one or more intermediaries, controls or is
controlled by or is under common control with such Person specified.
The term "Buyer" shall have the meaning ascribed to it in the first
paragraph hereof.
The term "Code" shall mean the U.S. Internal Revenue Code of 1986, as
amended, or any successor law.
The term "Closing" shall have the meaning ascribed to it in Section 1.2.
The term "Closing Date" shall have the meaning ascribed to it in Section
1.2.
The term "Confidentiality Agreement" shall have the meaning ascribed to it
in Section 10.7
The term "Company" shall have the meaning ascribed to it in the first
paragraph hereof.
The term "Contest" shall mean any administrative or judicial Income Tax
audit, examination, proceedings, litigation, request for information, or inquiry
involving a federal, state, or local governmental authority having jurisdiction
over assessment, determination, collection or imposition of any Income Tax.
The term "Damages" shall have the meaning ascribed to it in Section 9.2(a).
The term "GAAP" shall mean Generally Accepted Accounting Principles as
promulgated by the Financial Accounting Standards Board.
The term "Financial Statements" shall mean the statement of financial
position of the Company as of December 31, 1995 and the related statements of
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income, shareholder's equity and cash flows for the fiscal year then ended and
the statement of changes in financial position as of June 30, 1996 and the
related statements of income, shareholder's equity and cash flows for the six
months ended June 30, 1996.
The term "HSR Act" shall mean the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements
Act of 1976, as amended.
The term "Income Taxes" shall mean all federal, state, local, and other
income, franchise, gross receipts taxes, and the Michigan Single Business Tax,
including interest, penalties and additions in connection therewith.
The term "Material Adverse Effect" shall mean any effect that is, or series
of effects that are (in the aggregate), materially adverse to the business,
operations, or financial condition of the Company or the ability of the Company
to consummate the transactions contemplated by this Agreement.
The term "Party" shall mean Buyer, Company or Seller individually and the
term "Parties" shall mean Buyer, Company and Seller collectively.
The term "Person" shall mean any natural person, corporation, general
partnership, limited partnership, limited liability company, group, union,
association, trust, court, agency, government, tribunal, instrumentality,
commission, arbitrator, board, bureau, or other entity or authority.
The term "Primark Group" shall have the meaning ascribed to it in Section
2.26.
The term "Purchase Price" shall have the meaning ascribed to it in Section
1.1.
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The term "Seller" shall have the meaning ascribed to it in the first
paragraph hereof.
The term "Senior Secured Notes" shall mean the Company's 8.82% Senior
Secured Notes due October 15, 2010.
The term "Shares" shall have the meaning ascribed to it in the first
WHEREAS clause hereof.
The term "Tax Returns" or "Returns" shall mean all reports, estimates, and
information statements relating to, or required to be filed in connection with
any taxes pursuant to the statutes, rules and regulations of any federal, state
or local government taxing authority.
The term "TIAA" shall mean the Teachers Insurance and Annuity Association
of America.
ARTICLE I
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ACQUISITION OF SHARES
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1.1 PURCHASE OF SHARES. The Parties hereby agree that at the Closing Buyer
shall purchase from Seller, and Seller shall sell to Buyer, the Shares, free and
clear of all security interests, pledges, liens, charges and encumbrances, in
consideration for $14.3 million in cash ("Purchase Price").
1.2 THE CLOSING. The closing of the sale and purchase of the Shares
contemplated under this Agreement (the "Closing") shall take place on a mutually
agreeable date that is no later than the seventh (7th) business day following
the expiration or early termination of the waiting period, or any extension
thereof, as provided in the HSR Act or on such other date as the Parties may
agree (the
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"Closing Date"). The Closing shall take place on the Closing Date at 10:00 a.m.
at the offices of Seller, 0000 Xxxxxx Xxxxxx, Xxxxx 0000, Xxxxxxx,
Xxxxxxxxxxxxx, or at such other time and place as the Parties may agree in
writing.
1.3 Delivery.
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1.3.1 BY SELLER. At Closing, Seller shall deliver to Buyer
certificates representing all of the Shares, duly endorsed in blank or
accompanied by stock powers duly executed in blank. Seller shall surrender to
Buyer at Closing the Company's stock transfer register and the Company's
corporate minute books. Seller shall also deliver to Buyer at the Closing the
following:
(a) copies, certified by the respective Secretaries or Assistant
Secretaries of Seller and the Company, of the resolution(s) duly adopted by
their respective Boards of Directors authorizing the transactions contemplated
by this Agreement;
(b) current certificates of existence and/or good standing for
Seller and the Company in their respective states of incorporation, as issued by
the Secretaries of State or other appropriate authorities of such states;
(c) the opinion of counsel to Seller described in Section 7.1.5
hereof;
(d) a copy of the Certificate of Incorporation of the Company,
certified as of a recent date by the Secretary of State of Michigan;
(e) a copy of the bylaws of the Company as in effect on the
Closing Date, certified by the Secretary or Assistant Secretary of the Company;
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(f) a certificate dated the Closing Date, in form satisfactory
to Buyer, of the President or a Vice President of Seller stating that the
representations and warranties of Seller contained herein remain true and
correct on the Closing Date as if made on such date and that all terms,
covenants and conditions to be complied with and performed by Seller on or prior
to the Closing Date shall have been complied with or performed;
(g) a certificate dated the Closing Date in form satisfactory
to Buyer of the President or a Vice President of the Company stating that the
representations and warranties of the Company contained herein remain true and
correct on the Closing Date as if made on such date and that all terms,
covenants and conditions hereunder to be complied with and performed by the
Company on or prior to the Closing Date shall have been complied with or
performed; and
(h) a certificate of an appropriate Officer of Seller stating,
under penalties of perjury, Seller's United States taxpayer identification
number and that Seller is not a foreign person, pursuant to Section 1445(b)(2)
of the Code. The certificate shall conform in form and substance to the
certificate attached hereto as Schedule 1.3.1(h).
1.3.2 BY BUYER. At Closing, Buyer shall deliver to Seller by cashier's
check drawn on a United States bank in the amount of Fourteen Million Three
Hundred Thousand Dollars ($14,300,000) pursuant to Section 1.1 herein. Buyer
shall also deliver to Seller at the Closing the following:
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(a) a copy, certified by Buyer's Secretary or Assistant
Secretary, of the resolutions duly adopted by the Board of Directors of Buyer
authorizing the transactions contemplated by this Agreement;
(b) a current certificate of existence and/or good standing for
Buyer in its state of incorporation as issued by the Secretary of State or other
appropriate authority of such state;
(c) a certificate dated the Closing Date, in form satisfactory
to Seller, of the President or a Vice President of Buyer stating that the
representations and warranties of Buyer contained herein remain true and correct
on the Closing Date as if made on such date and that all terms, covenants, and
conditions hereunder to be complied with and performed by Buyer on or prior to
the Closing Date shall have been complied with or performed; and
(d) the opinion of counsel to Buyer described in Section 8.1.5
hereof.
1.4 FURTHER ASSURANCE OF SELLER AND BUYER. At the Closing and from time to
time thereafter, Seller and Buyer shall execute such additional instruments and
documents and take such other action as the other Party may reasonably request
in order more effectively to sell the Shares to Buyer.
1.5 Access to Books and Records.
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(a) For a period of three years immediately following the Closing Date
(plus any additional time during which there is an ongoing audit by any
government agency with respect to periods prior to the Closing Date), Buyer
agrees to give Seller and its duly authorized representatives, reasonable
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cooperation, access, photocopying capability and staff assistance during normal
business hours on reasonable notice with respect to such of the business and
financial records and other data of the Company (relating to periods prior to
the Closing Date) as may be deemed reasonably necessary by Seller, to an extent
as will not unreasonably interfere with Buyer's conduct of the business of the
Company. Seller shall reimburse Buyer for its out-of-pocket expenses for all of
the foregoing. Buyer shall cause the Company not to destroy or otherwise dispose
of such books and records of the Company as may reasonably be required for audit
purposes until such time as such books and records are no longer required for
such purposes.
(b) Seller shall, and Seller shall cause its duly authorized
representatives to, treat as confidential and, except for disclosures to any
governmental authorities or agencies required for audit purposes, not use,
submit or disclose to, or file with, others or permit any person or entity under
its and their control to use, submit or disclose to, or file with, others, any
documents, information or data disclosed by Buyer pursuant to this Section 1.5
without the written consent of Buyer.
ARTICLE II
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REPRESENTATIONS AND WARRANTIES OF SELLER
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Seller hereby represents and warrants to, and agrees with, Buyer as
follows:
2.1 ORGANIZATION, STANDING AND QUALIFICATION OF THE COMPANY. The Company is
a corporation duly organized, validly existing and in good standing under the
laws of Michigan. The Company has all requisite corporate power and
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authority to own and operate its properties and to carry on its business as now
being conducted and as proposed to be conducted. The Company has not qualified
to do business as a foreign corporation in any jurisdiction and such failure to
so qualify would not be likely to result in a Material Adverse Effect.
2.2 AUTHORITY AND AUTHORIZATION. Each of Seller and the Company has the
corporate power and authority to execute and deliver this Agreement and to
perform its obligations hereunder, and all such action has been duly and validly
authorized by all necessary corporate proceedings on its part.
2.3 EXECUTION AND BINDING EFFECT. This Agreement has been duly and validly
executed and delivered by each of the Seller and the Company and constitutes the
legal, valid and binding obligations of the Seller and the Company enforceable
in accordance with the terms hereof, except as such enforceability may be
limited by bankruptcy, insolvency or other similar laws of general application
affecting the enforcement of creditors' rights or by general principles of
equity limiting the availability of equitable remedies.
2.4 CONSENTS AND APPROVALS. Except for the filings required under the HSR
Act as provided for in Section 5.7 hereof, Seller and the Company have each
obtained or made all necessary (i) consents, approvals and authorizations, and
registrations and filings with governmental authorities, and (ii) consents,
approvals, waivers and notifications of stockholders, creditors, lessors and
other non-governmental persons, in each case, which are required to be obtained
or made by the Seller and the Company in connection with the execution and
delivery
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of this Agreement, and the consummation of the transactions contemplated herein.
2.5 NO VIOLATION. The execution, delivery and performance of this Agreement
will not violate, conflict with, or constitute a breach by Seller or the Company
of (i) any provision of the Certificate of Incorporation or Bylaws of Seller or
the Company, (ii) any statute, regulation, ordinance or other law applicable to
Seller or the Company, (iii) any judicial or administrative order, award,
judgment or decree applicable to Seller or the Company or by which either of
them or any of their property is subject or bound, or (iv) the provisions of, or
result in the acceleration of performance under, any evidence of indebtedness,
instrument, agreement, contract, commitment or understanding to which Seller or
the Company is subject or by which any of their property is bound; nor will
consummation of the transactions contemplated hereby require prior approval,
consent or authorization of any governmental agency or regulatory body, except
for the HSR Filings; nor will execution, delivery and performance of this
Agreement by Seller and the Company and consummation of the transactions
contemplated hereby result in the creation or imposition of any lien upon any
property now owned by the Company.
2.6 FINANCIAL STATEMENTS. The Seller has heretofore furnished to the Buyer
(a) the statement of financial position of the Company as of December 31, 1995
and the related statements of income, shareholder's equity and cash flows for
the fiscal year then ended, as audited by Deloitte & Touche LLP, independent
certified public accountants and (b) the unaudited statement of financial
position
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of the Company as of June 30, 1996 and the related statements of income,
shareholder's equity and cash flows for the six-months ending June 30, 1996. All
of the foregoing Financial Statements (including the notes thereto) present
fairly the consolidated financial position of the Company as of the end of such
fiscal year or as of the end of such six-months then ended and the results of
its operations and the changes in its financial position and its cash flows (as
the case may be) for the fiscal year or six-months then ended, all in conformity
with GAAP applied on a basis consistent with that of the preceding fiscal year.
2.7 NO EVENT OF DEFAULT; COMPLIANCE WITH INSTRUMENTS. The Company is not in
violation of any of its charter provisions or bylaws. To the best of Seller's
knowledge, the Company is not in default under any term or condition of any
instrument evidencing, creating or securing any indebtedness of the Company, and
there has been no default in any material obligation to be performed by the
Company under any other contract, lease, agreement, commitment or undertaking to
which it is a party or by which it or its assets or properties are bound, nor
has the Company waived any material right under any such contract, lease,
agreement, commitment or undertaking. The Company has not received any notice of
any default or event of default under any such agreements.
2.8 LITIGATION. Except as set forth in Schedule 2.8, there are no claims,
actions, suits, proceedings or investigations pending, or, to the knowledge of
Seller and the Company, threatened against or affecting the Company or any of
the assets or properties of the Company, at law or in equity, or before or by
any court or federal, state, municipal or other governmental department,
commission,
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board, agency or instrumentality. The Company is not subject to any continuing
court or administrative order, writ, injunction or decree applicable to it or to
any of its assets, business or property.
2.9 SUBSIDIARIES. The Company has no Subsidiaries nor any other investment
or ownership interest in any corporation, partnership, joint venture (other than
farm-out agreements set forth on Schedule 2.20) or similar entity.
2.10 PENSION-RELATED MATTERS. The Company has no employee benefit plans or
multiemployer plans. The Company has no liability (contingent or otherwise) for,
and none of the Company's assets are encumbered in connection with, (i) the
minimum funding requirements under the Employee Retirement Income Security Act
or the Internal Revenue Code of 1986 with respect to any plan, (ii) any
amendment to a plan, (iii) any Pension Benefit Guaranty Corporation premiums
with respect to a plan which are due and unpaid by the Company or (iv) the
termination of a plan or withdrawal by the Company from any multiemployer plan.
2.11 TITLE TO PROPERTY. Except as set forth in Schedule 2.11, the Company
has good and marketable title to all real property interests, and good and
marketable title to all personal property, sold to Primark Holding Corporation
(the Company is a successor in interest to Primark Holding Corporation) by
Michigan Consolidated Gas Company under the instruments listed in paragraph
numbered 5 to Schedule 2.11, such interests are free and clear of any and all
liens, claims and encumbrances except for (i) the rights of ANR under the ANR
Leases, (ii) the rights of TIAA under the Senior Secured Notes, and (iii) liens,
claims, encumbrances and any defects in the Company's title to such property,
which do not and will not
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have a Material Adverse Effect. In addition, the Company has good and marketable
title to all real and personal property that it has acquired since 1982 which is
reflected in the property accounts of the Company, subject to the exceptions
noted in (i) and (ii) above and except for liens, claims and encumbrances in the
Company's title to such property which do not and will not have a Material
Adverse Effect. Seller does not have any other real or personal property
interests related to oil and gas or storage operations in the State of Michigan.
The assets and properties of the Company are subject to liens and
encumbrances under the terms of the Senior Secured Notes.
2.12 TAXES. To the best of Seller's knowledge, all federal, state and local
Income Tax Returns required to be filed by the Company have been properly
prepared, executed and filed. All taxes, assessments, fees and other
governmental charges upon the Company or upon any of its properties, incomes,
sales or franchises which are due and payable have been paid. The time for audit
by the Internal Revenue Service has expired for all fiscal periods ending on or
prior to December 31, 1985. Except as otherwise set forth on Schedule 2.12, no
issues have been raised by and are currently pending before any taxing authority
with respect to the operations of the Company; and no waivers of statutes of
limitation with respect to Tax Returns have been given by or requested from
Seller or the Company with respect to Tax Returns including the operations of
the Company. Schedule 2.12 to this Agreement sets forth: (i) the taxable years
as to which the respective statutes of limitations with respect to Income Taxes
have not
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expired; (ii) with respect to such taxable years, those years for which
examinations have been completed, those years for which examinations are
presently being conducted, and those years for which Tax Returns have not yet
been filed; and with respect to such taxable years, all issues that are
currently pending before any taxing authority. Except as listed on Schedule
2.12, all tax deficiencies asserted or assessments made with respect to the
operations of the Company as a result of any examinations have been fully paid,
or are fully reflected as a liability in the Financial Statements, or are being
contested, and an adequate reserve therefor has been established and is fully
reflected in the Financial Statements.
2.13 POWER TO CARRY ON BUSINESS. The Company has all requisite power and
authority to own and operate its properties and to carry on its business as now
conducted and as presently planned to be conducted.
2.14 NO MATERIAL ADVERSE CHANGE. Since December 31, 1995 there has been no
Material Adverse Effect on the business, operations or financial condition of
the Company, except for effects occurring in the ordinary course of business
consistent with past practice or as disclosed by this Agreement. Notwithstanding
anything to the contrary, no representation or warranty is made under this
Section 2.14 with respect to the changes in the business or operations of the
Company that relate to the activities of ANR Pipeline Company or its Affiliates
under its leases with the Company. For purposes of this Section 2.14 only,
"Material Adverse Effect" shall mean only effects whose actual value is $750,000
or more, in any one instance or circumstance, or effects whose actual value is
$1,500,000
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or more in the aggregate. When used in any other section of this Agreement,
"Material Adverse Effect" shall have the meaning set forth on page 3 herein.
2.15 COMPLIANCE WITH ENVIRONMENTAL LAWS. Except (i) as disclosed in
Schedule 2.15, (ii) for those matters that the Buyer or its Affiliates are
aware, and (iii) for a violation or liability which does not exceed $1,000,000
in any one instance or circumstance, or violations or liabilities which do not
exceed $2,000,000 in the aggregate, to the best of Seller's and the Company's
knowledge (without imposing any obligation on the Seller or the Company to make
inquiry), the Company is not in violation of or subject to any liability,
contingent or otherwise, on account of any law concerning the occupational and
health or safety law, any applicable environmental law, or hazardous waste or
toxic substance management, handling or disposal law.
2.16 OWNERSHIP AND CONTROL. Schedule 2.16 to this Agreement states as of
the date hereof the authorized capitalization of the Company, the number of
shares of each class of capital stock issued and outstanding of the Company and
the record holder of such shares. The outstanding shares have been duly
authorized and validly issued and are fully paid and nonassessable.
2.17 TITLE TO SHARES. Seller has good and marketable title to the Shares,
free and clear of any security interests, pledges, claims, liens, encumbrances
or other rights or interests of any other Person. Seller has the absolute and
unrestricted right, power, authority and capacity to sell the Shares to Buyer.
The Company does not have any outstanding subscriptions, options or other
agreements or commitments obligating it to issue shares of its capital stock.
From
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the date of this Agreement through the Closing Date, Seller will not, and Seller
will not permit the Company to, issue or enter into any subscriptions, options,
agreements or other commitments in respect of the issuance, transfer, sale or
encumbrance of any shares of capital stock of the Company.
2.18 BURDENSOME OBLIGATIONS. To the Seller's knowledge, as of the date
hereof, the Company is not subject to any restriction under its articles of
incorporation or bylaws which is so unusual or burdensome as to be likely in the
foreseeable future to have a Material Adverse Effect.
2.19 ABSENCE OF UNDISCLOSED LIABILITIES. Except as set forth in the
Financial Statements and in Schedule 2.19, the Company has not incurred, and
none of its assets or properties are subject to, any material absolute or
contingent liabilities or obligations, whether or not such liabilities or
obligations are normally shown or reflected on a balance sheet prepared in a
manner consistent with GAAP, other than accrued operating expenses arising in
the ordinary course of business since June 30, 1996. Except as set forth in
Schedule 2.19, there are no facts in existence and which are known or should
reasonably be known to Seller or the Company which might serve as the basis for
any material liability or obligation of the Company, and which are not disclosed
in the Financial Statements.
2.20 CONTRACTS AND COMMITMENTS. Schedule 2.20 to this Agreement is a
complete list of all material contracts, agreements and commitments to which the
Company is a party or by which its assets are bound excluding easements, liens
and security interests on the Company's real and personal property (Schedule
2.20 includes certain contracts, agreements and commitments which are not
material to the Company). A true copy of each such contract and agreement and
each document evidencing each such commitment has been delivered to Buyer by
Seller. Except as disclosed in Schedule 2.20,
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each such contract, agreement or document is in full force and effect, and
neither the Company, nor to the knowledge of Seller, any other party thereto is
in default thereunder.
2.21 INSURANCE POLICIES. Schedule 2.21 to this Agreement lists all policies
of insurance held by or covering the Company. Such policies are in such amounts,
and insure against such losses and risks, as are generally maintained for
comparable businesses, operations and properties. Valid policies for such
insurance will be outstanding and duly in force at all times prior to the
Closing and thereafter such policies as they relate to the Company shall be
cancelled.
2.22 LICENSES, PERMITS, ETC. The Company has all material licenses,
franchises, permits, certificates, consents, rights and privileges necessary or
appropriate to the conduct of the business of the Company and all such items
within the possession of the Company or the Seller have been made available to
Buyer. All such material items are in full force and effect. To the current
knowledge of the Seller and the Company, the Company has not received any
notification from any governmental or regulatory body advising the Company that
it does not have the necessary licenses, permits, certificates, consents, rights
and privileges necessary to the conduct of its business.
2.23 COMPLIANCE WITH LAWS. To the knowledge of the Seller and the Company,
the Company has complied in all material respects with all applicable
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federal, state, and local statutes, ordinances and regulations in respect of the
ownership of its properties and the operations or conduct of the business of the
Company. Notwithstanding anything to the contrary, no representation or warranty
is made under this Section 2.23 with respect to the operations or conduct of the
business of the Company that relate to the activities of ANR Pipeline Company or
its Affiliates under its leases with the Company.
2.24 EMPLOYEES. The Company has no employees nor any liabilities that might
be associated with having employees.
2.25 BOOKS AND RECORDS. The books and records of the Company are in all
material respects complete and correct and fairly reflect a true record of all
financial affairs, and meetings and proceedings of the Board of Directors and
shareholders, of the Company.
2.26 AFFILIATED GROUP. The Company is a member of an affiliated group
within the meaning of Section 1504(a) of the Code of which Seller is the common
parent ("Primark Group") and will be included in the consolidated federal income
tax return of the Primark Group for the tax period that includes the Closing
Date.
2.27 DUE DILIGENCE. Seller has offered Buyer through the Closing Date
access to the offices of Seller and the Company, and to their respective
properties, officers, books and records in order that the Buyer may have an
opportunity to make such investigations as it deems necessary or advisable
during the time allowed. Seller has given Buyer the opportunity to ask questions
of, and receive answers from, the Seller and the Company concerning the Company.
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ARTICLE III
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REPRESENTATIONS AND WARRANTIES OF BUYER
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Buyer hereby represents and warrants to, and agrees with, Seller as
follows:
3.1 Organization: Corporate Authority, etc.
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3.1.1 ORGANIZATION. The Buyer is a corporation duly organized and
validly existing and in good standing under the laws of the State of Delaware,
and has all corporate power and authority (i) to make this Agreement and any
other agreements contemplated hereby and to incur and perform its obligations
hereunder and thereunder.
3.1.2 AUTHORITY OF BUYER. All necessary corporate action has been
taken by Buyer to authorize the execution, delivery and performance of this
Agreement. This Agreement is the legal, valid and binding obligation of Buyer,
enforceable in accordance with its terms, except as limited by applicable
bankruptcy, insolvency, reorganization, moratorium or other laws of general
application relating to or affecting the rights of creditors generally and by
general equitable principals.
3.2 NO VIOLATION. The execution, delivery and performance of this
Agreement will not violate, conflict with, or constitute a breach by Buyer of
(i) any provision of the Certificate of Incorporation or Bylaws of Buyer, (ii)
any statute, regulation, ordinance or other law applicable to Buyer, (iii) any
judicial or administrative order, award, judgment or decree applicable to Buyer
or by which it or any of its property is subject or bound, or (iv) the
provisions of, or result in the acceleration of performance under, any evidence
of indebtedness, instrument,
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agreement, contract, commitment or understanding to which Buyer is subject or by
which any of its property is bound; nor will the consummation of the
transactions contemplated hereby require prior approval, consent or
authorization of any governmental agency or regulatory body except for the HSR
Filings.
3.3 INVESTMENT INTENT. The Shares are being purchased for Buyer's own
account for investment only and Buyer has no present intention of resale or
other distribution thereof. Buyer acknowledges that, in reliance on the
foregoing representation, the Shares have not been registered under the
Securities Laws. Buyer acknowledges that Seller has disclosed to Buyer that the
Shares may not be resold absent such registration or unless an exemption from
registration is available. Buyer has such knowledge and experience in financial
and business matters that it is capable of evaluating the merits and risks of
the purchase of such Shares. Buyer acknowledges and agrees that neither the
Seller nor the Company nor any of their employees or representatives have made
any representations or warranties, express or implied, with respect to the
business operations, financial statements or prospects of the Company except as
and to the extent expressly set forth in this Agreement, the Schedules delivered
hereunder and any other documents or certificates delivered pursuant to this
Agreement. Each of the Company and Buyer agree to deliver to Seller at the
Closing a Release in the form of Exhibit A attached hereto which has been duly
executed by each of them.
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ARTICLE IV
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COVENANTS OF BUYER
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Buyer hereby covenants and agrees with Seller as follows:
4.1 TRANSFER TAXES. Buyer shall be responsible for the payment of all
applicable transfer or similar taxes (excluding Income Taxes) arising out of the
transactions contemplated herein.
4.2 FURTHER ASSURANCES OF BUYER. Subject to the terms and conditions herein
provided, Buyer agrees to use its best efforts to take, or cause to be taken,
all actions and to do, or cause to be done, all things necessary, proper or
advisable under applicable laws and regulations to consummate and make
effective, as soon as reasonably practicable, the transactions contemplated by
this Agreement.
4.3 CORPORATE NAME. The parties acknowledge and agree that all rights,
title and interest in and to the name "Primark Storage Leasing Corporation"
shall remain the property of Seller except that Buyer may use such name in the
ordinary course of business for ninety days following Closing. In furtherance of
the foregoing, Buyer agrees to cause the Company to execute immediately after
Closing the "Agreement of Assignment" substantially in the form as set forth in
Schedule 4.3 hereto. Buyer agrees that the remedy at law for any breach by it of
this provision will be inadequate and the Seller shall be entitled to equitable
remedies, including specific performance.
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ARTICLE V
---------
COVENANTS OF SELLER
-------------------
Seller hereby covenants and agrees with Buyer as follows:
5.1 CONDUCT OF BUSINESS. From and after the date of this Agreement and
until the Closing:
(a) Seller shall cause the Company (i) to conduct its business only
in the ordinary course and consistent with past practice, (ii) to continue to
perform its existing obligations in accordance with their terms, (iii) pay all
current liabilities when due, in accordance with the Company's current practice,
and (iv) collect accounts receivable in accordance with the Company's current
practice;
(b) Seller shall cause the Company not to cause or permit any of the
following without the prior written approval of Buyer;
(i) any changes in the assets or liabilities of the Company which
would have a Material Adverse Effect;
(ii) the issuance of any shares of stock or other security or the
granting of any stock option or right to purchase shares of capital stock or the
issuance of any security convertible into shares of capital stock of the
Company;
(iii) the incurrence by the Company of any new obligation or
liability in excess of $50,000 individually or $100,000 in the aggregate, except
for ongoing operation, maintenance and tax expenses;
(iv) the cancellation of existing insurance policies except that
the renewal of existing policies or obtaining insurance policies in substitution
of existing policies shall not be deemed to be a cancellation of such policies;
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(v) the making of any new or capital commitment by the Company for
an amount exceeding, in any one instance, $50,000 or $100,000 in the aggregate;
(vi) the sale or disposition of any real or personal property by
the Company other than inventory in the ordinary course of business or as
otherwise permitted herein; (vii) any change in the Certificate of Incorporation
or Bylaws of the Company; (viii) any change in the accounting methods or
practices of the Company; or
(ix) the merger or consolidation of the Company with any other
corporation or the acquisition of all or substantially all the stock or the
business of another person, corporation or other entity, or any agreement to do
any of the foregoing.
(c) Seller shall cause the Company to use its best efforts to maintain
or cause to be maintained all existing insurance coverage (or coverage in
substitution thereof) on the assets of the Company until the Closing Date. Buyer
and Seller agree that from the date of this Agreement until the Closing Date all
risks of loss, damage, or destruction to the physical assets owned by the
Company shall be borne by Seller.
5.2 SCHEDULES. Seller shall promptly supplement or amend and deliver to
Buyer the Schedules that Seller is required to prepare hereunder with respect to
any matters arising after the date of this Agreement which, if existing or
occurring
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at the date of this Agreement, would have been required to have been set forth
and described in such Schedule. No supplement or amendment of a Schedule made
pursuant to this Section 5.2 shall be deemed to cure any fraud or breach of any
representation or warranty made in this Agreement.
5.3 ACCESS. From the date of this Agreement until the Closing Date, Seller
shall cause the representatives of Buyer to be afforded complete access to the
offices, properties, books, records and contracts, of the Company at all
reasonable times during normal business hours and will furnish Buyer with such
additional financial and operating data and other information as Buyer shall
from time to time reasonably request; provided that all such access and
information shall be supplied in such a way as to minimize disruption of the
business of the Company. Any disclosure whatsoever during such investigation by
Buyer shall not constitute an enlargement of or additional warranties or
representations of Seller beyond those specifically set forth in this Agreement,
the Schedules delivered herein and the other documents and certificates
delivered hereunder.
5.4 FURTHER ASSURANCES OF SELLER. Subject to the terms and conditions
herein provided, Seller agrees to use its best efforts to take, or cause to be
taken, all actions and to do, or cause to be done, all things necessary, proper
or advisable under applicable laws and regulations to consummate and make
effective, as soon as reasonably practicable, the transactions contemplated by
this Agreement.
5.5 BOOKS AND RECORDS. Seller shall deliver to Buyer at Closing, the minute
book, stock transfer books and corporate seal of the Company, together
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with the signed resignation of the officers and the members of the board of
directors of the Company. Within 30 days of Closing, Seller shall cause to be
delivered to Buyer all books and records, separate company Tax Returns, and
other documents relating to the Company, and all accounting records relating to
the Company that are in the possession of the Seller.
5.6 CERTAIN TAX INFORMATION. After the Closing Date, Seller, on the one
hand, and Buyer, on the other hand, (i) shall provide, or shall cause to be
provided, to and by each other and each other's respective affiliates, officers,
employees and representatives, such assistance as may reasonably be requested by
any of them in connection with the preparation of any Tax Return, the conduct of
any audit or the defense of any litigation or other proceeding with respect to
any tax liability of the Company and (ii) shall retain, or shall cause to be
retained, for the appropriate period any records or information that may be
relevant to any such return or audit. The assistance provided for in this
Section 5.6 shall include providing, or causing to be provided, such information
as might reasonably be expected to be of use in connection with any such return,
audit, litigation or proceeding, including, without limitation, records,
returns, schedules, documents, work papers, opinions, letters, memoranda or
other relevant materials relating thereto. All such materials and information
shall be held in confidence by the recipient thereof and shall not be disclosed
by the recipient in any manner whatsoever and shall not be used by the recipient
other than in connection with such return, audit or litigation without the
written consent of the supplier of the information, except as required by law.
The Party requesting the assistance
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provided for in this Section 5.6 shall reimburse the Party whose assistance is
requested for the cost of such assistance (to the extent such assistance imposes
more than DE MINIMUS time demands on the Party whose assistance is requested)
and for reasonable out-of-pocket costs (including compensation of employees who
provide such assistance outside of their regular working hours) incurred by it
in providing such assistance. The term "audit" as used in this Section 5.6 shall
include any inquiry, examination or other conduct of any taxing authority or any
judicial or administrative proceedings.
5.7 HSR FILINGS. Each of Seller and Buyer shall file or cause to be filed
on behalf of such Party's ultimate parent entity (as defined in the rules
promulgated under the HSR Act) a Notification and Report Form under the HSR Act
with the Federal Trade Commission ("FTC") and the Antitrust Division of the
Department of Justice ("DOJ") with respect to this Agreement, and shall use its
best efforts to respond as promptly as practicable to all inquiries received
from the Federal Trade Commission or the Antitrust Division with respect to the
transactions contemplated by this Agreement. Closing of the transactions
contemplated herein shall not occur unless and until the FTC and the DOJ either
take no action with respect to the HSR Filings or take action with respect
thereto which is acceptable to both Seller and Buyer in the exercise of their
respective sole discretion.
5.8 HSR FILING FEE. Buyer, as the purchaser hereunder, shall pay the filing
fee required by the Federal Trade Commission in connection with the filing of
the Notification and Report Forms referred to in Section 5.7 above.
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ARTICLE VI
----------
TAXES
-----
6.1 Responsibility for Payment.
--------------------------
6.1.1 SELLER'S RESPONSIBILITY. From and after the Closing, Seller
agrees to, and shall, indemnify Buyer, the Company and their Affiliates and hold
each of them harmless from and against, and Seller shall be responsible for the
payment of, any and all Income Taxes with respect to all periods ended on or
prior to the Closing Date and all taxes which were due and payable prior to the
Closing Date, including, without limitation, any and all Income Taxes and
liabilities arising out of the consummation of the transactions contemplated
hereby. Seller also agrees to, and shall, indemnify Buyer, the Company and their
Affiliates and hold them harmless from and against any Income Taxes relating to
any Pre-Closing Affiliate of the Company and Seller for any taxable period prior
to and including the Closing Date which are imposed on the Company pursuant to
Treasury Regulation Section 1.1502-6 or comparable provisions under other laws.
6.1.2 BUYER'S RESPONSIBILITY. Buyer or the Company shall pay all taxes
with respect to all other periods ending after the Closing Date.
6.1.3 MISCELLANEOUS. For purposes of this Section 6.1, any interest,
penalty or additional charge included in taxes shall be paid by the Party
responsible under this Article VI for the tax to which the interest, penalty or
additional charge relates. The indemnity provided for in this Section 6.1 shall
be independent of any other indemnity provision hereof, and, anything in this
Agreement to the contrary notwithstanding shall survive until the expiration of
the
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applicable statutes of limitation or extensions thereof for the Taxes referred
to herein.
6.1.4 TREATMENT OF PAYMENTS. All indemnification payments made under
this Section 6.1 shall be treated as Purchase Price adjustments for tax
purposes.
6.2 RETURNS. The Parties hereto will elect with the relevant taxing
authority in a timely manner to treat the period beginning on January 1, 1996
and ending on the Closing Date and the period beginning the day after the
Closing Date and ending on December 31, 1996 as separate short taxable periods
for Income Tax purposes.
6.3 Contests.
--------
(a) Unless Buyer agrees in writing to waive any claim for
indemnification with respect thereto, Seller shall have exclusive control over
and responsibility to conduct any Contest (as such term is defined in Article
IA) for any tax periods ended on or before the Closing Date. Buyer shall have
exclusive control over and responsibility to conduct any Contest for any tax
periods beginning after the Closing Date.
(b) Not later than fifteen days after written notice of a Contest is
received by Buyer or the Company, Buyer shall notify Seller in writing of
receipt by Buyer or the Company of notice of any Contest relating to a tax
period ended on or before the Closing Date. With respect to each such Contest if
failure of Buyer to comply substantially with the provisions of this paragraph
(b) for such notice of Contest precludes Seller from prosecuting such Contest,
then Seller shall be
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relieved from any liability with respect to such Contest under this Article VI.
Buyer shall also be responsible for any interest and/or penalties which become
payable as a result of Buyer's failure to give notice within the time provided
above.
(c) Buyer, the Company, and Seller agree to cooperate and assist fully
with each other with respect to defending or answering any Contest and to
provide each other with all materials, information and documents as reasonably
requested by the other.
(d) In any Contest controlled by Seller, Buyer will take, and will
cause the Company to take, such action as Seller may by written notice
reasonably request in connection with such Contest (including the payment of any
tax preparatory to filing a claim for refund of such tax; provided that Seller
shall first pay the amount of such tax to Buyer). In any such Contest, Seller
shall indemnify and hold Buyer, the Company and their Affiliates harmless from
and against any interest and penalties incurred in connection with any such
action taken at Seller's request.
(e) Notwithstanding the foregoing provisions of this Section 6.3,
Seller shall consult with Buyer with respect to the resolution of any issue that
arises in connection with a Contest for any tax periods ended on or before the
Closing Date if such issue would affect Buyer or the Company in any post
acquisition taxable year, and Seller shall not settle any such issue or file any
amended return with respect to such issue without the consent of Buyer, which
consent shall not be unreasonably withheld. Where consent is withheld by Buyer,
Buyer may continue or initiate further proceedings at its own expense. In such
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case where Buyer withholds consent, any liability of Seller shall not exceed the
liability Seller would have incurred had Buyer not withheld consent.
(f) Not later than fifteen days after written notice of a Contest is
received by Seller, Seller shall notify Buyer in writing of any Contest for any
tax periods after the Closing Date. With respect to each such Contest if failure
of Seller to comply substantially with the provisions of this paragraph (f) for
such notice of Contest precludes Buyer from prosecuting such Contest, then
Seller shall be responsible for any interest and/or penalties which become
payable as a result of Seller's failure to give notice within the time provided
above; provided, however, that Buyer has filed within 30 days of the Closing
Date with the appropriate federal, state and local tax authorities a notice of
change of address and provided, further, that Seller's responsibility under this
paragraph (f) shall terminate one year from the Closing Date.
6.4 Refunds.
-------
(a) All refunds of Income Taxes with respect to a tax period ended
prior to the Closing Date shall be owned by Seller except to the extent that
such refund arises as the result of a carryback of a loss or other tax benefit
(other than for federal income tax purposes) of the Company from a period
beginning after the Closing Date. The Company and Buyer hereby authorize Seller
to endorse any such refunds received by Seller on behalf of the Company and to
retain such funds. The Company and Buyer also hereby authorize Seller to contact
tax authorities regarding the status of such refunds. All refunds of Income
Taxes with respect to a tax period ended on or prior to the Closing Date
received by Buyer or
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the Company shall be endorsed by the Company and delivered to Seller within
thirty (30) days after receipt thereof by Buyer or the Company.
(b) All refunds of taxes with respect to a tax period ended after the
Closing Date shall be owned by the Company. All such refunds received by Seller
shall be delivered to Buyer or the Company within thirty (30) days after receipt
thereof by Seller.
6.5 TERMINATION OF TAX ALLOCATION AGREEMENT. Effective as of the Closing
Date, all liabilities and obligations between Seller and the Company under any
tax allocation agreement or other similar arrangement in effect prior to the
Closing Date shall be extinguished in full and any such agreements or
arrangements and any liabilities or rights existing thereunder shall terminate
and have no further effect for any past, current or future tax period or year.
6.6 SECTION 338(h)(10) ELECTION. The Parties agree, and shall cause their
Affiliates, to cause a timely and effective election (the "338(h)(10) Election")
under Section 338(h)(10) of the Code (and any comparable election under state,
local or foreign tax law) with respect to the purchase of the Shares. In that
respect, Seller agrees to cause the "common parent" (as defined in Section 1504
of the Code) of the "affiliated group" (as defined in Section 1504 of the Code)
that includes the Seller and the Company for the taxable period that includes
the Closing Date to join in the Section 338(h)(10) election. Within sixty (60)
days after the Closing Date, Buyer shall deliver to Seller a completed Internal
Revenue Service Form 8023-A and required schedules thereto (the "Form"), as well
as any applicable state, local or foreign forms (the "State Form"). Provided
that the
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information on the Form is, in the reasonable determination of Seller, correct
and complete in all material respects, Seller shall, within 30 days after
receipt of such Form, execute the Form and deliver the Form to Buyer. If any
changes or supplements are required to the Form, the Parties will promptly
inform each other of same and Seller and Buyer will promptly agree on such
changes. Buyer will timely file the Form, and any required supplements thereto,
and will provide assurance to the Seller that it has done so. Seller and Buyer
agree that neither of them nor any of their Affiliates shall take any unilateral
action to modify or revoke the elections contained in or the content of the
Form, any State Forms and any supplements. Seller and its Affiliates shall file
their respective Federal tax returns (and affected state and local returns) in a
manner consistent with the Section 338(h)(10) Election.
6.7 ALLOCATION OF PURCHASE PRICE. Seller and Buyer agree to negotiate in
good faith on an allocation of the Purchase Price, as adjusted, among the assets
of the Company that are deemed to have been acquired pursuant to Section
338(h)(10) of the Code or any state law equivalent. The agreed allocation shall
be set forth in a letter agreement and used to file all reports and returns for
taxes. If Seller and Buyer are unable to agree on an allocation within ninety
days after the Closing Date, Buyer and Seller shall be free to make any
allocation they desire, and Buyer shall allow Seller and its authorized agent
and representatives access to the Company and its books and assets to allow
Seller to make an appraisal of such assets and a tax allocation. Should Buyer or
Seller hire an appraiser to appraise the value of the assets of the Company,
Buyer or Seller shall provide the other
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with a true copy of the written appraisal report made by such firm, upon payment
of one-half of the cost of any such appraisal.
6.8 RESOLUTION OF DISAGREEMENTS AMONG PARTIES. If Seller or Buyer disagree
as to any tax matters governed by this Agreement, Seller and Buyer shall
promptly consult with each other in an effort to resolve such dispute. Any
amounts not in dispute shall be paid promptly, and any amounts payable upon the
resolution of a dispute shall be paid to a bank account designated by the payee
no later than three (3) business days after such resolution. If any such
disagreement over tax matters cannot be resolved within ten (10) days after
Seller or Buyer asserts in writing that such dispute cannot be resolved, Seller
and Buyer shall jointly select an Independent Accounting Firm to act as an
arbitrator to resolve the disagreement. The Independent Accounting Firm's
determination shall be final and binding upon the Parties, except as to errors
of law, and any fees and expenses relating to the engagement of the Independent
Accounting Firm shall be shared equally by Seller and Buyer. Upon resolution of
such dispute over tax matters by the Independent Accounting Firm, any amounts
payable by Seller or Buyer shall be made to a bank account designated by the
payee no later than three (3) business days after such resolution. Simple
interest will be paid with respect to any such amounts at a rate per annum equal
to 300 basis points over LIBOR-3 from the date of the assertion in writing that
the dispute cannot be resolved to the date of payment.
6.9 SURVIVAL. The covenants and agreements set forth in this Article VI
shall survive the Closing.
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ARTICLE VII
-----------
CONDITIONS PRECEDENT TO THE OBLIGATIONS OF BUYER
------------------------------------------------
7.1 CONDITIONS. The obligations of Buyer to perform this Agreement are
subject to the fulfillment, to its satisfaction, on or prior to the Closing
Date, of each of the following conditions:
7.1.1 REPRESENTATIONS AND WARRANTIES CORRECT; PERFORMANCE OF
OBLIGATIONS. The representations and warranties made by Seller and the Company
in this Agreement and the Schedules delivered hereunder shall be true and
correct in all respects on the Closing Date, with the same force and effect as
if they had been made on and as of such date, subject only to changes
contemplated by this Agreement; Seller and the Company shall have performed all
covenants and obligations and observed all conditions herein required to be
performed or observed by each of them on or prior to the Closing Date.
7.1.2 AUTHORIZATION OF SALE. All action necessary to authorize the
execution, delivery and performance of this Agreement, and the consummation of
the transactions contemplated hereby, shall have been duly and validly taken by
Seller and the Company.
7.1.3 CONSENTS, WAIVERS, AND AUTHORIZATIONS. Seller and the Company
shall have obtained any and all consents, waivers and authorizations (including
any government consents, waivers or authorizations) necessary or appropriate
for consummation of the transactions contemplated by this Agreement. The
waiting period under the HSR Act shall have expired or been terminated.
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7.1.4 PROCEEDINGS AND DOCUMENTS. All corporate and other proceedings in
connection with the transactions contemplated by this Agreement, and all
documents and instruments incident to such transactions including without
limitation the various Schedules and amendments or modifications to such
Schedules referred to herein to be delivered by Seller, shall have been
delivered to Buyer and shall be reasonably satisfactory in form and substance to
Buyer and Buyer shall have received all such counterpart originals or certified
or other copies of such documents as it may reasonably request.
7.1.5 OPINION OF COUNSEL FOR SELLER. Buyer shall have received an
opinion of Xxxxxxx X. Xxxxxxx, counsel for Seller, dated the Closing Date, to
the effect that:
(i) the Company is a corporation duly organized, validly existing
and in good standing under the laws of its state of incorporation and has all
requisite corporate power to carry on its businesses as now conducted;
(ii) the authorized capital stock of the Company consists of
50,000 shares of common stock, $1.00 par value, 25,000 shares of which are
validly issued and outstanding, fully paid and nonassessable and owned of record
and beneficially by Seller, and the remaining 25,000 shares being unissued;
(iii) there are no outstanding subscriptions, options or other
agreements or commitments obligating the Company to issue any shares of its
capital stock or securities convertible into shares of its capital stock;
(iv) Seller is the record and beneficial owner of all the Shares
of the Company, free and clear of all security interests, pledges, mortgages,
liens,
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encumbrances, charges or assessments, and has full capacity to sell and transfer
the Shares in accordance with this Agreement, and upon such sale and transfer to
Buyer by Seller, Buyer will acquire from Seller all rights of Seller with
respect to the Shares;
(v) this Agreement and the Release have been duly executed and
delivered by Seller and the Company and constitutes the valid and binding
obligations of Seller and the Company in accordance with their terms, subject to
applicable laws of bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and similar laws affecting creditors rights and
remedies generally and, as to enforceability, subject to general principles of
equity (regardless of whether such enforceability is considered in a proceeding
in equity or at law);
(vi) all corporate and other proceedings required to be taken on
the part of each of Seller and the Company to authorize it to execute, deliver
and perform under this Agreement and the Release have been duly and properly
taken;
(vii) the consummation of the transactions contemplated by this
Agreement and the Release will not result in the breach of or constitute a
default under the respective Certificates or Articles of Incorporation or bylaws
of Seller or the Company or any loan, credit or similar agreement or court
decree known to such counsel to which Seller or the Company is a party or by
which any of their respective assets or properties are bound;
(viii) except for litigation described in Schedule 2.8, such
counsel does not know of any litigation or other proceeding or governmental
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investigation pending or threatened against or relating to the Company or to the
transactions contemplated by this Agreement;
(ix) Except for the filings required under the HSR Act which
Seller has completed, no authorization, approval or consent of or declaration or
filing with any governmental authority or regulatory body, federal, state or
local, is necessary or required in connection with the execution and delivery of
this Agreement and the Release by Seller or the Company or the performance by
Seller or the Company of their respective obligations hereunder.
7.1.6 Absence of Challenge.
--------------------
(i) No action or proceedings shall have been instituted prior to
or at the Closing Date before any court or other governmental body, or
instituted, declared, or threatened by any public authority or private party,
the result of which would prevent or make illegal the consummation of the
transactions contemplated by this Agreement.
(ii) No private party shall have challenged, or declared the
intent or threatened to challenge, the rights of Seller or the Company under any
contract or agreement material to the continued operation of the Company
business following the Closing.
7.1.7 GOOD STANDING. Seller shall have delivered to Buyer original
copies, dated within sixty (60) days prior to the Closing Date, of a certificate
of an appropriate official attesting that the Company is in good standing in
Michigan.
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7.1.8 NO DAMAGE OR DESTRUCTION. Prior to the Closing, there shall not
have occurred any casualty to any real or personal property of the Company which
would have a Material Adverse Effect.
7.1.9 RELEASE. Seller shall have delivered to Buyer the Release in the
form of Exhibit A hereto duly executed by Seller.
7.1.10 TIAA AMENDMENT. Seller shall have delivered to Buyer a copy of
the fully executed Amendment of Purchase Agreement between the Company and TIAA
together with a copy of the fully executed Amendment of Mortgage, Assignment and
Security Agreement between the Company and TIAA in each case satisfactory to
Buyer.
7.2 WAIVER. Buyer may, at its sole discretion, waive fulfillment of any or
all the conditions set forth in Section 7.1 of this Agreement.
ARTICLE VIII
------------
CONDITIONS PRECEDENT TO THE OBLIGATIONS OF SELLER
-------------------------------------------------
8.1 CONDITIONS. The obligations of Seller to perform this Agreement are
subject to the fulfillment, to its satisfaction, on or prior to the Closing
Date, of the following conditions:
8.1.1 REPRESENTATIONS AND WARRANTIES CORRECT; PERFORMANCE OF
OBLIGATIONS. The representations and warranties made by Buyer in this Agreement
shall be true and correct in all respects on the Closing Date with the same
force and effect as if they had been made on and as of such date, subject only
to changes contemplated by this Agreement; Buyer shall have performed all
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covenants and obligations and observed all conditions herein required to be
performed or observed prior to the Closing Date.
8.1.2 AUTHORIZATION OF SALE. All action necessary to authorize the
execution, delivery and performance of this Agreement and the consummation of
the transactions contemplated hereby shall have been duly and validly taken by
Buyer.
8.1.3 CONSENTS, WAIVERS AND AUTHORIZATIONS. Buyer shall have obtained
any and all consents, waivers and authorizations, including any government
consents, waivers, or authorizations necessary or appropriate for consummation
of the transactions contemplated by this Agreement. The waiting period under the
HSR Act shall have expired or been terminated.
8.1.4 ABSENCE OF CHALLENGE. No action or proceeding shall have been
instituted prior to or at the Closing Date before any court or other
governmental body, or instituted, declared, or threatened by any public
authority or private party, the result of which could prevent or make illegal
the consummation of the transactions contemplated by this Agreement.
8.1.5 OPINION OF COUNSEL FOR BUYER. Seller shall have received an
opinion of Xxxxxx X. X'Xxxxx, counsel for Buyer, dated the Closing Date, to the
effect that:
(i) the Buyer is a corporation duly organized, validly existing
and in good standing under the laws of the State of Delaware;
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(ii) all corporate and other proceedings required to be taken on
the part of the Buyer to authorize it to execute and deliver this Agreement and
the Release have been duly and properly taken;
(iii) this Agreement and the Release have been duly executed and
delivered by Buyer and constitutes the valid and binding obligations of Buyer in
accordance with their terms, subject to applicable laws of bankruptcy,
insolvency, fraudulent conveyance, reorganization, moratorium and similar laws
affecting creditors rights and remedies generally and, as to enforceability,
subject to general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at law);
(iv) neither the execution and delivery by the Buyer of this
Agreement or the Release nor the consummation of the transactions contemplated
thereby will result in a breach of or constitute a default under the Articles of
Incorporation or bylaws of Buyer or any loans, credit or similar agreement or
court decree known to such counsel to which Buyer is a party or to which any of
its assets or properties are bound; and
(v) except for the filings required under the HSR Act which Buyer
has completed, no authorization, approval or consent of or declaration or filing
with any governmental authority or regulatory body, federal, state or local, is
necessary or required in connection with the execution and delivery of this
Agreement and the Release by the Buyer or the performance by Buyer of its
obligations herewith.
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8.1.6 RELEASE. Buyer and the Company shall have delivered to Seller the
Release in the form of Exhibit A hereto duly executed by Buyer, an Affiliate of
the Buyer and the Company.
8.1.7 TIAA AMENDMENT. Seller shall have received a fully executed
Amendment of Purchase Agreement between the Company and TIAA together with a
fully executed Amendment of Mortgage, Assignment and Security Agreement between
the Company and TIAA in each case satisfactory to Buyer.
8.2 WAIVER. Seller may, at its sole discretion, waive fulfillment of
any or all the conditions set forth in Article VIII of this Agreement.
ARTICLE IX
----------
SURVIVAL OF REPRESENTATIONS; INDEMNIFICATION
--------------------------------------------
9.1 SURVIVAL OF REPRESENTATIONS AND WARRANTIES. Except as provided in this
sentence, the representations and warranties of Seller and Buyer made in this
Agreement shall survive the Closing for nine months; provided, however, that the
covenants and agreements contained in Article VI shall survive until the
expiration of the applicable statute of limitations.
9.2 General Indemnity.
-----------------
(a) Subject to the terms and conditions of this Article IX, Seller
agrees to, and shall, indemnify Buyer and the Company and hold each of them
harmless from and against all demands, claims, actions or causes of action,
assessments, losses, damages, liabilities, costs and expenses, including,
without limitation, interest, penalties and reasonable attorneys' fees and
expenses
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(hereinafter collectively called "Damages"), asserted against, resulting to,
imposed upon or incurred by Buyer or the Company by reason of or resulting from
(i) a breach of any representation, warranty, covenant or agreement of Seller or
the Company contained in or made pursuant to this Agreement, or (ii) the
threatened action set forth in paragraph numbered 2 to Schedule 2.8. To the
extent that Seller shall also be liable under Section 6.1 hereof, the provisions
of said Section 6.1 shall govern.
(b) Subject to the terms and conditions of this Article IX, Buyer
agrees to and shall indemnify Seller and hold it harmless from and against all
Damages (as defined above) asserted against, resulting to, imposed upon or
incurred by Seller by reason of or resulting from (i) a breach of any
representation, warranty, covenant or agreement of Buyer contained in or made
pursuant to this Agreement, (ii) all of the claims, proceedings or suits
(whether threatened or otherwise) set forth in Schedule 2.8 and Schedule 2.15
(it being understood that Buyer shall assume the defense of such matters at
Closing) except that Buyer shall not be required to indemnify Seller for Damages
resulting from the action set forth in paragraph numbered 2 to Schedule 2.8,
(iii) the matters covered by Section 9.4, and (iv) the Company's default after
the Closing on the Senior Secured Note.
(c) No Party shall be liable to any other party hereunder for Damages
until the aggregate amount of Damages due to a Party exceeds an accumulated
total of $200,000 and then only for the amount of any such excess up to an
aggregate liability of $13,000,000.
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9.3 CONDITIONS OF INDEMNIFICATION. The respective obligations and
liabilities of Seller, on the one hand, and Buyer, on the other, (herein
sometimes called the "indemnifying party") to the other (herein sometimes called
the "party to be indemnified") under Section 9.2 or Section 9.4 hereof with
respect to claims resulting from the assertion of liability by third parties
shall be subject to the following terms and conditions:
(a) Within 20 days after receipt of notice of commencement of any
action or the assertion of any claim by a third party, the party to be
indemnified shall give the indemnifying party written notice thereof together
with a copy of such claim, process or other legal pleading, and the indemnifying
party shall have the right to undertake the defense thereof by representatives
of its own choosing;
(b) In the event that the indemnifying party, by the 30th day after
receipt of notice of any such claim (or, if earlier, by the tenth day preceding
the day on which an answer or other pleading must be served in order to prevent
judgment by default in favor of the person asserting such claim), does not elect
to defend against such claim, the party to be indemnified will (upon further
notice to the indemnifying party) have the right to undertake the defense,
compromise or settlement of such claim on behalf of and for the account and risk
of the indemnifying party, subject to the right of the indemnifying party to
assume the defense of such claim at any time prior to settlement, compromise or
final determination thereof;
(c) Anything in this Section 9.3 to the contrary notwithstanding, (i)
if there is a reasonable probability that a claim may materially and adversely
affect
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the indemnified party other than as a result of money damages or other money
payments, the indemnified party shall have the right, at its own cost and
expense, to compromise or settle such claim, but (ii) the indemnified party
shall not, without the prior written consent of the indemnifying party, settle
or compromise any claim or consent to the entry of any judgment which does not
include as an unconditional term thereof the giving by the claimant or the
plaintiff to the indemnifying party a release from all liability in respect of
such claim; and
(d) In connection with any such indemnification, the indemnified party
shall cooperate in all reasonable requests of the indemnifying party.
9.4 ENVIRONMENTAL INDEMNIFICATION. Buyer hereby agrees to indemnify Seller
and agrees to hold Seller harmless from and against any and all losses,
liabilities, damages, injuries, costs, expenses (including reasonable fees of
counsel and other experts) and claims of any and every kind whatsoever paid,
incurred or suffered by or asserted against Seller and each of the Seller's and
the Company's directors, officers, employees, successors and assigns for, with
respect to, or as a direct or indirect result of the presence of any adverse
environmental condition (including, without limitation, pollution) at, about,
on, arising from or relating to any property owned, operated, leased, subleased
or otherwise used or acquired by the Company at any location (regardless of
whether such adverse environmental condition is or was created by Seller, the
Company or a predecessor or successor in interest and regardless of whether such
condition exists or potentially existed at Closing), including, without
limitation, any losses, liabilities, damages, injuries, costs, expenses
(including reasonable fees of counsel and other experts) or claims
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asserted or arising under the Comprehensive Environmental Response, Compensation
and Liability Act, or any so-called "Superfund" or "Superlien" law, or any other
federal, state, or local statute, law, ordinance, rule, regulation, code, order
or decree regulating or relating to or imposing liability or standards of
conduct concerning any hazardous material including, without limitation, toxic
or dangerous waste, substance or material. Buyer agrees that Seller shall be
named as an additional insured, as their interests may appear, on any insurance
policies of the Buyer or any of its affiliates covering the matters set forth in
this Section 9.4. The provisions of and undertakings and indemnifications set
forth in this Section 9.4 shall survive the Closing and the termination of the
Agreement.
ARTICLE X
---------
MISCELLANEOUS
-------------
10.1 DISCLOSURE. Except as required by applicable law or a court or
regulatory agency of competent jurisdiction, prior to Closing neither Party
hereto shall disclose the existence or contents of this Agreement to any third
party without the consent of the other Party hereto. On and immediately after
Closing, each Party hereto agrees to provide the other Parties hereto in advance
of its release to the public, any press release announcing the consummation of
the transaction contemplated by this Agreement.
10.2 NOTICES. All notices and other communications hereunder shall be in
writing and shall be deemed to have been duly given at the time of receipt if
delivered personally or sent by facsimile, or three (3) days after mailing if
mailed in
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the United States by certified or registered mail, postage prepaid, return
receipt requested:
(a) If to Buyer, to:
American Natural Resources Company
000 Xxxxxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Attn: Xxxxxxx X. Xxxxxxx
and
ANR Pipeline Company
000 Xxxxxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Attn: Xxxxx Xxxxxxx, Esq.
(b) If to Seller, to:
Primark Corporation
0000 Xxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxxxxxxxx 00000
Attn: Xx. Xxxxxx X. Xxxxxxxx
and
Primark Corporation
0000 Xxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxxxxxxxx 00000
Attn: Xx. Xxxxxxx X. Xxxxxxx
provided, however, that if either of the Parties shall have designated a
different address by notice to the other given as above provided at least five
days prior to the mailing of a notice by the other, then to the last address so
designated.
10.3 BROKERAGE. Each of Seller and Buyer will indemnify and hold harmless
the other against and in respect of any claim for brokerage or other commissions
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relative to this Agreement or to the transactions contemplated hereby, based in
any way on agreements, arrangements or understandings made or claimed to have
been made by either Seller or the Company on the one hand, or Buyer on the other
hand, with any third party.
10.4 COUNTERPARTS. This Agreement may be executed in one or more
counterparts each of which shall be deemed an original and all of which together
shall constitute one and the same instrument.
10.5 CONSTRUCTION. This Agreement shall be construed and enforced in
accordance with the laws (other than the rules governing conflicts of laws) of
the State of Delaware. The parties hereto agree that any suit or proceeding
instituted by any party hereto against any other party hereto shall be
instituted only in the state or federal courts of the State of Delaware.
10.6 HEADINGS. The captions of the Sections and Articles of this Agreement
and the headings of the Schedules hereto are for convenience only and shall not
be considered or referred to in resolving questions of meaning, interpretation
or construction.
10.7 ENTIRE AGREEMENT. Except for the confidentiality agreement letter
dated May 13, 1996 ("Confidentiality Agreement") a copy of which is attached
hereto as Schedule 10.7, this Agreement (including the Schedules and Exhibits
hereto) sets forth the entire agreement and understanding of the Parties with
respect to the transactions contemplated hereby, and supersedes all prior
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agreements, arrangements, understandings, communications, representations or
warranties, both written and oral, related to the subject matter hereof.
10.8 CONFIDENTIALITY. Seller shall not disclose in any manner any
Confidential Information of the Company known by Seller on the Closing Date,
provided, that, Seller may disclose such Confidential Information to any
director, officer, employee, agent or representative who needs to know the same
in connection with the performance of its responsibilities to Seller, or if
required by law. For purposes of this Section 10.8, "Confidential Information"
means the following information or data of the Company: business plans,
marketing strategies, trade secrets, computer data and software and customer
lists. Information shall not be deemed to be confidential if it (i) is or
becomes publicly known through no wrongful act of Seller; or (ii) is furnished
by the Company or Buyer without restrictions upon its nondisclosure or use; or
(iii) is received by Seller from a third party without restrictions and without
breach of this Section 10.8; or (iv) is approved for release or use by the
Company or Buyer.
10.9 BENEFIT. No person or entity who is not a party to this Agreement
shall have any rights or derive any benefit hereunder.
10.10 WAIVER OR MODIFICATION. This Agreement may be amended, modified,
superseded or canceled, and compliance with any of the terms, provisions,
covenants, representations, warranties and commissions hereof may be waived,
only by written instrument executed by all Parties hereto, or, in the case of a
waiver, by the Party waiving compliance. Such waivers or failures to insist upon
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strict compliance with such terms, provisions, covenants, representations,
warranties and commissions shall not operate as a waiver of, or estoppel with
respect to, any subsequent or other failure.
10.11 SEVERABILITY. The invalidity of any one of the words, phrases,
sentences, clauses, subsections or sections contained in this Agreement shall
not affect the enforceability of the remaining portions of this Agreement or any
part hereof and, in the event that any one or more of the words, phrases,
sentences, clauses, subsections or sections contained in this Agreement shall be
declared invalid, this Agreement shall be construed as if such invalid word or
words, phrase or phrases, sentence or sentences, clause or clauses, subsection
or subsections, section or sections had not been inserted; provided, however,
that in the event of such construction this Agreement remains substantially in
the form contemplated by the Parties hereto.
10.12 EXPENSES. All legal, accounting and other costs, fees and expenses
incurred in connection with this Agreement and any of the transactions
contemplated hereby shall be borne and paid by the Party incurring such costs,
fees and expenses and no Party shall be obligated for any cost, fee or expense
incurred by any other Party.
10.13 SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon and
inure to the benefit of the Buyer and its successors and permitted assigns, and
Seller and its successors and permitted assigns. No Party may assign any of
their
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respective rights or obligations hereunder without the consent of the other
Party hereto.
10.14 DISCLOSURE. Information disclosed in any Schedule of this Agreement
shall be deemed disclosed in all schedules of this Agreement.
10.15 INTERCOMPANY ACCOUNTS AND OBLIGATIONS. On or prior to Closing, Seller
shall cause all intercompany accounts (including, without limitation, income tax
related accounts, all of which shall be deemed to be intercompany accounts for
the purposes of this Agreement) and all other agreements, understandings and/or
obligations between the Company, on the one hand, and the Seller or any of its
affiliates on the other hand, to be paid, eliminated or canceled as of the
Closing Date and shall cause the Company to distribute to Seller all remaining
cash of the Company.
10.16 KNOWLEDGE. Whenever a phrase or sentence herein is qualified by "to
the knowledge of Seller or the Company", or a similar phrase, it is intended to
mean the actual knowledge of Xxxxxx X. Xxxxxxxx, Xxxxxxx X. Xxxxxx or Xxxxxx X.
Xxxxx.
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IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be
executed by their duly authorized officers as of the date first above written.
Seller
Primark Corporation
By: XXXXXXX X. XXXXXX
---------------------------------
Name: Xxxxxxx X. Xxxxxx
---------------------------------
Title: Senior Vice President
---------------------------------
Buyer
American Natural Resources Company
By: XXXXXXX X. XXXXXXX
---------------------------------
Name: Xxxxxxx X. Xxxxxxx
---------------------------------
Title: Vice President and Controller
---------------------------------
Company
Primark Storage Leasing Corporation
By: XXXXXXX X. XXXXXX
---------------------------------
Name: Xxxxxxx X. Xxxxxx
---------------------------------
Title: Chief Financial Officer
---------------------------------
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