EXHIBIT 10.1
SETTLEMENT AGREEMENT
THIS SETTLEMENT AGREEMENT is made as of September 12, 2003 by and between
Andritz AG, ("AG"),Andritz Selas S.A.S., a French societe par actions
simplifiee (formerly known as Andritz Acquisition S.A.A.( "Andritz") and
Selas Corporation of America, a Pennsylvania corporation ("SCA").
WHEREAS
A. AG, Andritz and SCA entered into an Asset and Share Purchase Agreement
dated as of October 11, 2002 (the "Purchase Agreement") by and between
AG, Andritz, SCA and Selas S.A.S., a French societe par actions
simplifiee ("SAS"). SCA and SAS are sometimes referred to,
collectively, as "Sellers."
B. SCA's and Selas's liability to Andritz under the Purchase Agreement is
joint and several pursuant to Section 10.15 of the Purchase Agreement.
C. Andritz has claims against SCA under Sections 2.12, 5.12 and Section
5.14 of the Purchase Agreement as described in Paragraphs 1.1, 1.2 and
1.3 of this Settlement Agreement (the "Claims").
D. AG, Andritz and SCA desire to settle the Claims and certain other
claims it may have under the Purchase Agreement.
E. Terms used in this Settlement Agreement and not defined herein shall
have the meaning specified in the Purchase Agreement.
F. SAS has been put into Administration ("placee en redressement
judiciaire") by judgment of the Commercial court of Nanterre on August
7, 2003.
FOR GOOD AND VALUABLE CONSIDERATION AND IN CONSIDERATION OF THE MUTUAL
PROMISES SET FORTH HEREIN, AG, ANDRITZ AND SCA AGREE AS FOLLOWS:
1.1 The Adjusted Net Asset Value of SAS is Negative Four Hundred
SeventyThousand Euro (-E470,000) pursuant to Section 2.12(e)(ii) of the
Purchase Agreement. Pursuant to Section 10.15 of the Purchase
Agreement, SCA is jointly and severally liable for this amount with SAS.
1.2 Pursuant to Section 5.14 of the Purchase Agreement, SAS has received
cash payments to date relating to Assets on the Value Date Balance
Sheet totalling E420,000. Pursuant to Section 10.15 of the Purchase
Agreement, SCA is jointly and severally liable for this amount with SAS.
1.3. Andritz has not received any payment on the ILVA Receivable and Sellers
owe Andritz the principal sum of One Million Two Hundred Ninety
Thousand Euro (E1,290,000) pursuant to Section 5.12 of the Purchase
Agreement. Pursuant to Section 10.15 of the Purchase Agreement, SCA is
jointly and severally liable for this amount with SAS.
2. In full satisfaction of the Claims, SCA agrees to pay Andritz the sum
of Two Million One Hundred Eighty Thousand Euro E2,180,000 )(the
"Settlement Amount"). Andritz acknowledges the receipt of $400,000 of
the Settlement Amount on or before the date hereof.
3. The Settlement Amount shall accrue interest at the rate of three-month
E LIBOR in effect from time to time commencing on September 1, 2003
until the Settlement Amount and all such accrued interest is fully paid.
4. For and in consideration of the mutual promises and agreements set
forth herein:
(a) AG and Andritz do each hereby remise, release and forever
discharge SCA, its subsidiaries (other than SAS), affiliates
(other than SAS), and their respective officers, agents,
servants, employees, successors, assigns, heirs, executors and
administrators (the "SCA Releasees") of and from all and all
manner of actions and causes of action, liabilities, suits,
debts, dues, accounts, bonds, covenants, contracts, agreements,
judgments, claims and demands which against said SCA Releasees,
AG and/or Andritz ever had, now has, or which any of their
respective successors or assigns or any of them hereafter can,
shall or may have, for or by reason of any cause, matter or thing
whatsoever arising in connection only with: (i) Sections 2.12 and
5.12 of the Purchase Agreement; (ii) claims which AG and/or
Andritz have as of the date hereof under Section 5.14 of the
Purchase Agreement; and (iii) claims involving a breach of any of
the representations and warranties set forth in Sections 3.6,
3.8, or 3.9 of the Purchase Agreement or any other representation
and warranty in Section 3 of the Purchase Agreement to the extent
based on the subject matter of the Claims (including any related
claim for indemnity under section 9.2(a).
(b) SCA hereby remises, releases and forever discharges AG and
Andritz, their subsidiaries, affiliates, and their respective
officers, agents, servants, employees, successors, assigns,
heirs, executors and administrators (the "Andritz Releasees") of
and from all and all manner of actions and causes of action,
liabilities, suits, debts, dues, accounts, bonds, covenants,
contracts, agreements, judgments, claims and demands which
against said Andritz Releasees, SCA ever had, now has, or which
any of their respective successors or assigns or any of them
hereafter can, shall or may have, for or by reason of any cause,
matter or thing whatsoever arising in connection only with
Sections 2.12 and 5.12 of the Purchase Agreement and claims which
SCA have as of the date hereof under Section 5.14 of the
Settlement Agreement. SCA hereby indemnifies Andritz for any
claims made by or on behalf of SAS under Section 2.12, 5.12 or
(with respect to claims existing as of the date hereof), 5.14 of
the Purchase Agreement based upon the subject matter of this
Settlement Agreement.
5. SCA shall pay the Settlement Amount as follows:
Due Date Amount Due
Paid E400,000
October 1, 2003 E100,000
November 1, 2003 E100,000
December 1, 2003 E100,000
January 1, 2004 E100,000
February 1, 2004 E100,000
March 1, 2004 E100,000
April 1, 2004 E100,000
May 1, 2004 E100,000
June 1, 2004 E100,000
July 1, 2004 E100,000
August 1, 2004 E100,000
September 1, 2004 E100,000
October 1, 2004 E100,000
November 1, 2004 E100,000
December 1, 2004 E100,000
January 1, 2005 E100,000
February 1, 2005 E100,000
March 1, 2005 E 80,000 together with all accrued but
unpaid interest
The first E1,290,000 in payments made on the Settlement Amount shall be
considered to have been made in respect of Andritz's claim against
Selas under Section 5.12 of the Purchase Agreement in connection with
the ILVA Receivables.
If banks are not open for business in New York or Paris on any of the
dates set forth above, any payment due on such date shall be due on the
next business day in New York and Paris.
6. In the event of any default in payment to Andritz of all or any portion
of the Settlement Amount on the due dates as set forth in Paragraph 5
hereof, whether in terms of the timing for any such payment or the
amount actually paid, and failure by SCA to cure such default within 3
business days of the date of receipt of notice of such default, Andritz
shall be entitled to declare by notice in writing to SCA that the
balance of the Settlement Amount and all accrued interest is
immediately due and payable ("Acceleration Notice"). The Acceleration
Notice shall contain a certificate by Andritz of the balance of the
Settlement Amount outstanding as at the date of such notice and such
certificate shall absent manifest error be conclusive as to the amount
then due and owing. Upon receipt of an Acceleration Notice, SCA shall
pay the amount therein set out to Andritz within three business days of
the date of receipt of the Acceleration Notice. Upon the delivery of
an Acceleration Notice, the unpaid Settlement Amount shall accrue
interest at the rate set forth in Paragraph 7 hereof.
7. Any portion of the Settlement Amount owing by SCA hereunder and not
timely paid, including for the avoidance of doubt the full sum due
hereunder in the event of an acceleration pursuant to Paragraph 6
hereof, shall accrue interest at the rate equal to the sum of one-month
EURIBOR, as in effect from time to time and 4%.
8. Nothing in this Settlement Agreement shall be deemed to waive or
prejudice Andritz's independent claims against SAS under Sections 2.12,
5.12 and 5.14 of the Purchase Agreement (the "SAS Claims") or any claim
or right SCA may have against SAS. Andritz shall file proofs of claim
against SAS with the Commercial court of Nanterre with respect to
Claims arising under Section 2.12 and 5.14 of the Purchase Agreement
and shall use good faith efforts to pursue such proofs of claim.
Andritz shall: (a) keep SCA informed as to the status of the SAS
Claims, and (b) promptly forward copies of all correspondence and other
communications received with respect to the SAS Claims or the
bankruptcy proceedings to SCA subject to any confidentiality
obligations Andritz may be under. Any amounts Andritz receives from
SAS in connection with such SAS Claims shall be fully credited against
the outstanding Settlement Amount by application against the
instalments set forth in Paragraph 5 in reverse chronological order. No
judgment or declaration in the French bankruptcy proceedings shall have
any impact on Andritz's rights against SCA hereunder. SCA shall be
subrogated to Andritz's rights in respect of the SAS Claims once
Andritz has received the entire Settlement Amount together with
interest owing hereunder.
9. Andritz has informed VAI Clecim that it is the owner of the ILVA
receivable and that all payments thereof should be made to Andritz.
Andritz shall use its good faith efforts to collect the ILVA
Receivable, provided that Andritz shall not be obligated to perform any
work on the project to which the ILVA Receivable relates. From time to
time hereafter, Andritz shall make inquiries as appropriate of ILVA or
VAI Clecim as to any Project Work (as defined below) and shall inform
and discuss with SCA as to such work and the status of its efforts to
collect the ILVA Receivable. AG and Andritz shall not, directly or
indirectly through another person or entity, undertake any Project Work
without conferring with SCA in advance. In event that Andritz, in its
sole and absolute discretion, undertakes any work that is within the
scope of the ILVA Order (other than work performed pursuant to Section
5.2(b) of the Purchase Agreement) ("Project Work"), SCA shall receive a
credit against the Settlement Amount equal to the total amount paid to
Andritz in connection with the Project Work minus 115% of Andritz's
Direct Costs (including labor and overhead at its current rate)
incurred in performing the Project Work. For the avoidance of doubt,
Project Work includes punch list items, work relating to the addition
of a movable cooler, work relating to modifying gas lines, and other
remedial work relating to the ILVA Order. Andritz shall not settle or
compromise the ILVA Receivable without the prior written consent of
SCA, which consent shall not unreasonably be withheld or delayed. Any
amounts Andritz receives in connection with the ILVA Receivable
(whether from SAS or ILVA) shall be fully credited against the
outstanding Settlement Amount by application against the instalments
set forth in Paragraph 5 in reverse chronological order. The ILVA
Receivable shall not be considered repurchased by SCA pursuant to
Section 5.12 of the Purchase Agreement until Andritz has received the
entire Settlement Amount together with interest owing hereunder, at
which point Andritz shall transfer title of the then unpaid ILVA
Receivable to SCA.
10. Andritz shall notify SCA promptly in writing of any moneys it recovers
pursuant to Paragraphs 8 or 9. Such notice shall contain a certificate
of the amounts credited against the Settlement Amount and the
calculation of the outstanding Settlement Amount. In the event that
the aggregate amount that Andritz receives from SCA, SAS and/or ILVA
exceeds the Settlement Amount (excluding the Andritz Bonus, if any),
such excess amount shall be promptly paid to SCA.
11. Intentionally Omitted.
12. This Settlement Agreement will be governed by the laws of the state of
New York without regard to conflicts of laws principles.
13. Each party to this Settlement Agreement represents and warrants that
the person(s) executing this Settlement Agreement on behalf of that
respective party has actual authority to execute this Settlement
Agreement and thereby bind that party.
14. This Settlement Agreement represents the entire and integrated
agreement between the parties hereto with respect to the subject matter
hereof and supersedes any prior negotiations, representations or
agreements either written or oral with respect to the subject matter
hereof. Except as modified herein, the Purchase Agreement and the
Andritz License Agreement shall remain in full force and effect in
accordance with their respective terms.
15. Each of AG, Andritz and SCA hereby irrevocably and unconditionally
submits to the exclusive jurisdiction of the state and federal courts
located in the State of New York, for any actions, suits, or
proceedings arising out of or relating to this Settlement Agreement and
the transactions contemplated hereby and further agrees that service of
any process, summons, notice or document by registered mail to AG's,
Andritz's address or SCA's address, as the case may be, set forth below
shall be effective service of process of any action, suit or proceeding
brought against AG, Andritz or SCA, as the case may be, in any such
court. Each of AG, Andritz and SCA hereby irrevocably and
unconditionally waives any objection to the laying of venue of any
action, suit or proceeding arising out of this Settlement Agreement or
the transactions contemplated hereby, in such state or federal courts
as aforesaid and hereby further irrevocably and unconditionally waives
and agrees not to plead or claim in any such court that any such
action, suit or proceeding brought in any such court has been brought
in an inconvenient forum.
16. By signing this Settlement Agreement and by consenting to jurisdiction
in the state and federal courts in the State of New York for the
limited and specific purpose of resolving disputes under this
Settlement Agreement pursuant to this Paragraph 16 hereof, AG and
Andritz are not and do not intend to transact business directly in the
United States or the State of New York and are not consenting to the
general jurisdiction of any federal or state court in the United
States. This Settlement Agreement may not, without AG's and Andritz's
prior written consent, be relied on in any manner or for any purpose by
any person other than SCA.
17. All notices and other communications under this Settlement Agreement
must be in writing and will be deemed to have been duly given when (a)
delivered by hand, (b) sent by telecopier (with written confirmation of
receipt), or (c) when received by the addressee, if sent by a
governmental postal service or internationally recognized delivery
service (receipt requested), in each case to the appropriate addresses
and telecopier numbers set forth below (or to such other addresses and
telecopier numbers as a party may designate by notice to the other
parties):
If to SCA:
Selas Corporation of America
Arden Hills Office
0000 Xxx Xxx Xxxx
Xxxxx Xxxxx, XX 00000
Attention: Xxxxxx X. Xxxxxxxxx, Chief Financial Officer
Tel: x0 000-000-0000
Fax: x0 000-000-0000
With a copy to:
Blank Rome LLP
Xxx Xxxxx Xxxxxx
Xxxxxxxxxxxx, XX 00000
Attention: Xxxxxxx X. Xxxxx, Esq.
Tel: x0 000-000-0000
Fax: x0 000-000-0000
If to AG or Andritz
Andritz AG
Statteggerstrasse X-0000
Xxxx, Xxxxxxx
Attention: Xx. Xxxxxxxx Xxxxxxx, Chief Executive Officer
Tel: x00 000 0000 0000
Fax: x00 000 0000 000
With a copy to:
Andritz (USA) Inc.
00000 Xxxxxxxx Xxxxxxx
Xxxxxxxxxx, XX 00000
Attention: Xxxxx X. Xxxxxxx, Group General Counsel
Tel: x0 000-000-0000
Fax: +1 770-640-2598l
18. All payments to Andritz under this Settlement Agreement shall be made
in EURO (E) by wire transfer of immediately available funds to the
following bank account or such other bank account as Andritz may from
time to time notify SCA:
Bank name and address SOCIETE GENERALE Orleans
BIC(Swift)-Code XXXXXXXX
Account name ANDRITZ SELAS S.A.S.
Account no./IBAN XX00 00000 00000 00000000000 00
19. This Settlement Agreement may be executed in more than one
counterpart. Once the signature of each of the signatories set forth
below has been affixed to one or more counterpart, this Agreement shall
be deemed fully executed as if all the signatures were contained on a
single document.
ANDRITZ SELAS S.A.S. SELAS CORPORATION OF AMERICA
By________________________ By________________________
By________________________
ANDRITZ AG.
By________________________
By________________________
