SHARE PURCHASE AGREEMENT
BETWEEN
THERMO OPTEK CORPORATION
AND
THERMO INSTRUMENT SYSTEMS INC.
-----------------------------
August 10, 1998
-----------------------------
SHARE PURCHASE AGREEMENT
THIS SHARE PURCHASE AGREEMENT (this "Agreement") dated as of August 10,
1998 is between Thermo Optek Corporation ("TOC"), a Delaware corporation, and
Thermo Instrument Systems Inc. ("THI"), a Delaware corporation.
Preliminary Statement
1. THI beneficially owns (a) all of the equity capital of and rights of
ownership in (the "Equity Capital") Gebruder Xxxxx GmbH ("Xxxxx") and (b) all of
the issued and outstanding shares (the "Capital Stock") of HB Instruments Inc.
("HB"). Xxxxx and HB are sometimes referred to herein individually as a
"Company" and collectively as the "Companies." The Equity Capital and the
Capital Stock are referred to herein collectively as the "Shares."
2. TOC desires to purchase, or cause its wholly-owned subsidiaries to
purchase, and THI desires to sell, or cause its subsidiaries to sell, all of the
Equity Capital of Xxxxx and the Capital Stock of HB, for the consideration set
forth below, subject to the terms and conditions of this Agreement.
NOW THEREFORE, in consideration of the mutual promises hereinafter set
forth and other good and valuable consideration, the receipt of which is hereby
acknowledged, the parties hereby agree as follows:
SECTION 1 - PURCHASE AND SALE OF THE SHARES
1.1 Purchase of the Shares from THI. Subject to and upon the terms and
conditions of this Agreement, at the closing of the transactions contemplated by
this Agreement (the "Closing"), THI shall sell, transfer, convey, assign and
deliver to TOC, or its wholly-owned subsidiaries, and TOC or its wholly-owned
subsidiaries shall purchase, acquire and accept the Shares.
1.2 Further Assurances. At any time and from time to time prior to and
after the Closing, at TOC's request and without further consideration, THI shall
promptly execute and deliver such instruments of sale, transfer, conveyance,
assignment and confirmation, and take all such other action as TOC may
reasonably request, more effectively to transfer, convey and assign to TOC, and
to confirm TOC's title to, all of the Shares owned by THI, to put TOC in actual
possession and operating control of the assets, properties and business of the
Companies, to assist in exercising all rights with respect thereto and to carry
out the purpose and intent of this Agreement.
1.3 Consideration for the Shares. The consideration to be paid by TOC for
the Shares (the "Purchase Price") shall be 2,075,342 shares (the "Purchase Price
Shares") of TOC's common stock, par value $.01 per share (the "TOC Common
Stock").
1.4 Closing. The Closing shall take place at the offices of THI at 00
Xxxxx Xxxxxx, Xxxxxxx, Xxxxxxxxxxxxx. At the Closing, THI shall deliver, or
cause its subsidiaries to deliver, the instruments or certificates evidencing
the Shares duly endorsed in blank or with stock powers duly executed. At the
Closing, TOC shall deliver one or more certificates representing the Purchase
Price Shares registered in the name of THI and/or such of its subsidiaries as
THI shall designate.
SECTION 2 - REPRESENTATIONS AND WARRANTIES OF THI
Except as set forth on the disclosure schedule delivered to TOC on the
date hereof (the "Disclosure Schedule"), THI represents and warrants to TOC as
follows. The term "knowledge," when used in this Agreement, shall mean actual
knowledge after reasonable investigation.
2.1 Organization and Qualification. Each of THI, Xxxxx and HB is a
corporation duly organized, validly existing and in good standing under the laws
of its jurisdiction of incorporation and has full corporate power and authority
to own, lease and operate its assets and to carry on its business as now being
and as heretofore conducted. Each of THI, Xxxxx and HB is qualified or otherwise
authorized to transact business as a foreign corporation in all jurisdictions in
which such qualification or authorization is required by law, except for
jurisdictions in which the failure to be so qualified or authorized would not
have a material adverse effect on the assets, properties, business, results of
operations, condition (financial or otherwise) or prospects of the Companies
taken as a whole.
2.2 Authority. THI has full right, power, capacity and authority to
execute, deliver and perform this Agreement and to consummate the transactions
contemplated hereby. The execution, delivery and performance of this Agreement
and the consummation of the transactions contemplated hereby have been duly and
validly authorized by all necessary corporate action on the part of THI. This
Agreement has been duly and validly executed and delivered by THI and
constitutes the valid and binding obligation of THI, enforceable against it in
accordance with the terms hereof. Neither the execution, delivery and
performance of this Agreement, nor the consummation of the transactions
contemplated hereby will (i) conflict with or result in a violation, breach,
termination or acceleration of, or default under (or would result in a
violation, breach, termination, acceleration or default with the giving of
notice or passage of time, or both) any of the terms, conditions or provisions
of the organizational documents of THI or the Companies, or of any note, bond,
mortgage, indenture, license, agreement or other instrument or obligation to
which THI or the Companies are a party or by which THI or the Companies or any
of their respective properties or assets may be bound or affected; (ii) result
in the violation of any order, writ, injunction, decree, statute, rule or
regulation applicable to THI or the Companies or any of their respective
properties or assets; (iii) result in the imposition of any lien, encumbrance,
charge or claim upon any assets of the Companies; or (iv) entitle any employee
of the Companies to severance or other payments or create any other obligation
to an employee. No consent or approval by, or notification to or filing with,
any court, governmental authority or third party is required in connection with
the execution, delivery and performance of this Agreement by THI or the
consummation of the transactions contemplated hereby.
2.3 Capitalization and Title to Shares.
(a) The authorized equity or share capital of each of the Companies
is set forth on Exhibit A hereto. THI is the record and beneficial owner of the
Equity Capital and the Capital Stock of Xxxxx and HB, respectively. All of the
Shares are duly authorized and are validly issued, fully paid, nonassessable and
free of preemptive rights.
(b) There are no other rights of ownership or shares of capital stock
of the Companies authorized or outstanding or any subscriptions, options,
conversion or exchange rights, warrants, repurchase or redemption agreements, or
other agreements or commitments obligating either of the Companies to issue,
transfer, sell, repurchase or redeem any shares of its equity capital, capital
stock or other securities. There are no written shareholder agreements, voting
trusts, proxies or other agreements, instruments or understandings with respect
to the voting of the equity capital or capital stock of either of the Companies.
The books and records of the Companies, including without limitation the books
of account, minute books, stock certificate books and stock ledgers, are
complete and correct and accurately reflect the conduct of the business and
affairs of the Companies.
2.4 Subsidiaries and Other Affiliates.
(a) The Disclosure Schedule sets forth all Subsidiaries of the
Companies and the jurisdiction in which each is incorporated. All of the equity
capital or the shares of capital stock of each such Subsidiary owned by the
Companies are owned free and clear of any charges, liens, encumbrances, security
interests or adverse claims. As used in this Agreement, "Subsidiary" means any
corporation or other legal entity of which a party to this Agreement owns,
directly or indirectly, fifty percent (50%) or more of the stock or other equity
interest entitled to vote for the election of directors and representations,
warranties and covenants referring to Xxxxx or HB or the Companies contained
herein shall be deemed to mean Xxxxx and HB, and each of its respective
Subsidiaries, both separately and together as a consolidated whole, unless and
except to the extent expressly indicated otherwise.
(b) There are no other rights of ownership or shares of capital stock
of any Subsidiary of the Companies authorized or outstanding or any
subscriptions, options, conversion or exchange rights, warrants, repurchase or
redemption agreements, or other agreements or commitments obligating any
Subsidiary of the Companies to issue, transfer, sell, repurchase or redeem any
shares of its capital stock or other securities. There are no shareholder
agreements, voting trusts, proxies or other agreements, instruments or
understandings with respect to the voting of the capital stock of any Subsidiary
of the Companies.
(c) Except for its Subsidiaries, the Companies do not, directly or
indirectly, own any material equity interest in any corporation, partnership,
joint venture or other entity.
2.5 Financial Statements. THI has delivered to TOC prior to the execution
of this Agreement true and complete copies of: the unaudited consolidating
balance sheets of the Companies as of January 3, 1998 and December 29, 1996, and
the unaudited consolidating statements of operations for the years then ended.
In addition, THI has delivered to TOC prior to the execution of this Agreement,
true and complete copies of the unaudited consolidating balance sheets of the
Companies as of July 4, 1998 and the unaudited consolidating statements of
operations for the six-month period then ended. Collectively, the financial
statements referred to in the preceding two sentences are sometimes referred to
herein as the "Financial Statements" and the unaudited consolidated balance
sheet of the Companies as of July 4, 1998 is referred to herein as the "Balance
Sheet." The Financial Statements have been prepared from, and are in accordance
with, the books and records of THI and fairly present the financial condition
and results of operations of the Companies as at the dates and for the periods
indicated, in each case in accordance with generally accepted accounting
principles applied on a basis consistent with previous years subject to normal
year-end adjustments, which in the aggregate are not material.
2.6 Absence of Undisclosed Liabilities; No Dealings with Affiliates. As of
the date of the Balance Sheet, the Companies had no liabilities or obligations
of any nature, whether accrued, absolute, contingent or otherwise and whether
due or to become due (including without limitation, liabilities as guarantor or
otherwise with respect to obligations of others or liabilities for taxes due or
then accrued or to become due), required to be reflected or disclosed on the
Balance Sheet that were not adequately reflected or reserved against on the
Balance Sheet. The Companies have no liabilities of the type required to be
reflected or disclosed on a balance sheet in accordance with generally accepted
accounting principles, other than liabilities (i) adequately reflected or
reserved against on the Balance Sheet, (ii) incurred since the date of the
Balance Sheet in the ordinary course of business and consistent with past
practice, (iii) that would not, in the aggregate, have a material adverse effect
on the Companies taken as a whole, or (iv) disclosed in this Agreement. The
Companies have no contractual arrangement with or commitment to or from any of
its stockholders, officers, management, directors or employees (or their family
members) other than such as may have been entered into in the normal course of
employment, including, without limiting the generality of the foregoing, being
directly or indirectly a joint investor or coventurer with respect to, or owner,
lessor, lessee, licenser or licensee of, any real or personal property, tangible
or intangible, owned or used by, or a lender to or debtor of, the Companies.
2.7 Taxes. The Companies have accurately prepared and duly and timely
filed all federal, state, local, provincial or foreign tax and other returns and
reports which were required to be filed, in respect of all income, franchise,
excise, sales, use, property (real and personal), VAT, payroll and other taxes,
levies, imports, duties, license and registration fees, charges or withholdings
of any nature whatsoever (collectively "Taxes"), and to the extent the
liabilities of the Companies, as of the date of the Balance Sheet, for Taxes
have not been fully discharged, adequate reserves have been established on the
Balance Sheet. None of the federal, state, local, provincial or foreign Tax
returns of the Companies has been audited or examined by the governmental
authority having jurisdiction. No waivers of any statutes of limitation are in
effect in respect of any Taxes. The Companies are not in default in the payment
of any Taxes due and payable or on any assessments received in respect thereof,
and there are no claims pending or, to the best knowledge of the Companies and
THI, threatened, against the Companies for past due Taxes. All Taxes incurred
but not yet due have been fully accrued on the books of the Companies or full
reserves have been established therefor; the reserves indicated on the Balance
Sheet are also adequate to cover all Taxes that may become payable by the
Companies in future periods in respect of any transactions or sales occurring on
or prior to the date of the Balance Sheet. Without limiting the generality of
the foregoing, the Companies have withheld or collected from each payment made
to each of their employees, consultants or non-U.S. payees, the amount of all
Taxes required to be withheld or collected therefrom, and has paid the same to
the proper tax receiving officers or authorized depositories.
2.8 Properties. Each of the Companies owns and has good title to all of
the assets and properties reflected as owned by it on the Balance Sheet or
acquired by it since the date of the Balance Sheet (except personal property
sold or otherwise disposed of in the ordinary course of business since the date
of the Balance Sheet), free and clear of any lien, claim or other encumbrance,
except for (i) the liens, claims or other encumbrances reflected on the Balance
Sheet, (ii) assets and properties disposed of, or subject to purchase or sales
orders, in the ordinary course of business since the date of the Balance Sheet,
(iii) liens, claims or other encumbrances securing the liens of materialmen,
carriers, landlords and like persons, all of which are not yet due and payable,
(iv) liens for taxes not yet delinquent and (v) liens, claims, other
encumbrances or defects in title that, in the aggregate, are not material to the
Companies taken as a whole. Each of the Companies owns or has a valid leasehold
interest in all of the buildings, structures, leasehold improvements, equipment
and other tangible property material to the Companies taken as a whole, all of
which are in good and sufficient operating condition and repair, ordinary wear
and tear excepted and the Companies have not received any notice that any such
property is in violation in any material respect of any existing law or any
building, zoning, health, safety or other ordinance, code or regulation.
2.9 Hazardous Materials.
(a) There has been no generation, use, handling, storage or disposal
of any Hazardous Materials in violation of common law or any applicable
environmental law at any site owned or premises leased by the Companies during
the period of the Companies' ownership or lease. To the best knowledge of the
Companies, there has not been and there is not threatened any release of any
Hazardous Materials on or at any such site or premises during such period in
violation of common law or any applicable environmental law or which created or
will create an obligation to report or remediate such release. For purposes of
this Agreement, "Hazardous Material" means any medical waste, flammable,
explosive or radioactive material, or any hazardous or toxic waste, substance or
material, including substances defined as "hazardous substances," "hazardous
materials," "solid waste" or "toxic substances" under any applicable laws or
ordinances relating to hazardous or toxic materials and substances, air
pollution (including noise and odors), water pollution, liquid and solid waste,
pesticides, drinking water, community and employee health, environmental land
use management, stormwater, sediment control, nuisances, radiation, wetlands,
endangered species, environmental permitting, petroleum products, and all rules
and regulations promulgated pursuant to any such laws and ordinances.
(b) THI has previously made available to TOC copies of all documents
in its possession concerning any environmental or health and safety matter,
copies of any environmental audits or risk assessments, site assessments,
documentation regarding off-site disposal of Hazardous Materials, spill control
plans and material correspondence with any governmental authority regarding the
foregoing.
2.10 Accounts Receivable. All accounts and notes receivable of the
Companies shown on the Balance Sheet and all accounts and notes receivable
acquired by the Companies subsequent to the date of the Balance Sheet have
arisen in the ordinary course of business and have been collected, or are in the
process of collection and are collectible in the ordinary course of business and
in any event within nine months from the Closing, in the aggregate recorded
amounts thereof, less the applicable allowances reflected on the Balance Sheet
with respect to the accounts and notes receivable shown thereon, or set up
consistent with past practice on the books of the Companies with respect to the
accounts and notes receivable acquired subsequent to the date of the Balance
Sheet.
2.11 Inventories. All Inventories (as defined below) of the Companies are
of a quality and quantity usable and saleable in the ordinary course of
business, except for obsolete items and items of below-standard quality, all of
which are in the aggregate immaterial to the Companies taken as a whole. Items
included in such Inventories are carried on the books of the Companies, and are
valued on the Balance Sheet, at the lower of cost or market. The value of
obsolete materials and materials of below-standard quality or quantity has been
written down on the books of account of the Companies to realizable market
value. The term "Inventories" includes all stock of raw materials,
work-in-process and finished goods, including but not limited to finished goods
purchased for resale, held by the Companies for manufacturing, assembly,
processing, finishing, sale or resale to others, from time to time in the
ordinary course of business of the Companies in the form in which such
inventories then are held or after manufacturing, assembling, finishing,
processing, incorporating with other goods or items, refining or the like.
2.12 Purchase and Sale Commitments. No outstanding purchase commitments by
the Companies are in excess of the normal, ordinary and usual requirements of
the Companies, and the aggregate of the contract prices to which the Companies
have agreed in any outstanding purchase commitments is not so excessive when
compared with current market prices for the relevant commodities or services
that a material loss is likely to result. No outstanding sales commitment by
either Company obligates the Companies to sell any product or service at a price
which, because of currently prevailing and projected costs of materials or
labor, is likely to result, when all such sales commitments are taken in the
aggregate, in a material loss to the Companies taken as a whole. There are no
material suppliers to the Companies of significant goods or services with
respect to which practical alternative sources of supply, or comparable
products, are not available on comparable terms and conditions.
2.13 Governmental Authorizations. The Companies have all governmental
permits, licenses, franchises, concessions, zoning variances and other
approvals, authorizations and orders (collectively "Permits") material to the
Companies taken as a whole. All such Permits are presently in full force and
effect, the Companies are in compliance with the requirements thereof, no
suspension or cancellation of any of them is threatened so far as is known to
THI or the Companies, and the sale of the Shares as contemplated hereby will not
adversely affect the validity or effectiveness of, and will not require, for
retention thereof after such sale, the consent or approval of any party to, or
any other person or governmental authority having jurisdiction of, any such
Permit. Neither the Companies nor THI has any knowledge of any fact or
circumstance which would prevent, limit or restrict it from continuing to
operate its business in the present manner, and no new requirements pertaining
to the manner of operating its business have been issued or announced by any
governmental authority during the past year nor are there any disputes pending
between the Companies and any governmental authority relating to the Companies'
operations as presently being conducted or actively considered.
2.14 Intellectual Property. The Companies own, or are licensed to use, or
otherwise have the right to use all patents, trademarks, service marks, trade
names, trade secrets, franchises, and copyrights, and all applications for any
of the foregoing, and all technology, know-how and processes necessary for the
conduct of their respective businesses as now conducted (collectively, the
"Proprietary Rights"). A list of all such copyrights, trademarks, tradenames and
patents, and all applications therefor, has been furnished or made available to
TOC. Neither the Companies nor THI is aware of any claim by any third party that
the business of the Companies as currently conducted or proposed to be conducted
infringes upon the unlicensed Proprietary Rights of others, nor has the
Companies or THI received any notice or claim from any third party of such
infringement by the Companies. Neither the Companies nor THI is aware of any
infringement by any third party on, or any competing claim of right to use or
own any of, the Proprietary Rights of the Companies. The Companies have the
right to use, free and clear of claims or rights of others, all customer lists
and computer software material to its business as currently conducted. To the
best knowledge of the Companies and THI, none of the activities of the employees
of the Companies, on behalf of the Companies, violates any agreements or
arrangements that any such employees have with former employers in a way that is
materially adverse to the business of the Companies taken as a whole.
2.15 Insurance. The Companies are not in default with respect to any
provisions of any policy of general liability, fire, title or other form of
insurance held by them, the Companies are current in the payment of all premiums
due on such insurance and the Companies have not failed to give any notice or
present any claim thereunder in due and timely fashion, except for claims that
are immaterial in both the nature of the claim and in the amount of such claim.
Each of the Companies maintains insurance on all of its assets and business
(including products liability insurance) from insurers that are financially
sound and reputable, in amounts and coverages and against the kinds of risks and
losses reasonably prudent to be insured against by corporations engaged in the
same or similar businesses. No basis exists which would jeopardize the coverage
under any such insurance. No such insurance will be terminated or canceled by
reason of the execution, delivery and performance of this Agreement or the
consummation of the transactions contemplated hereby. THI has previously
furnished or made available to TOC all policies of general liability, fire,
title or other forms of insurance applicable to the Companies and a description
of all claims pending thereunder other than health or dental insurance claims.
2.16 Employee Benefit Plans.
(a) THI has made available or furnished to TOC true and complete
copies of each pension, profit-sharing, deferred compensation, incentive
compensation, severance pay, retirement, welfare benefit or other plan or
arrangement providing benefits to employees or retirees, including both those
that do and do not constitute employee benefit plans within the meaning of
Section 3(3) of the Employee Retirement Income Security Act of 1974, as amended
(the "ERISA"), currently maintained or contributed to by THI or any of its
affiliates for the benefit of the employees of each of the Companies (each, a
"Plan").
(b) Except as set forth on the Disclosure Schedule, (i) each such
Plan that is an "employee pension benefit plan" within the meaning of Section
3(2) of ERISA is being operated and administered in compliance with Section
401(a) of the Code, a favorable determination letter has been obtained from the
Internal Revenue Service (the "IRS") for such Plan, and there is no accumulated
funding deficiency, as defined in Section 302(a)(2) of ERISA or Section 412 of
the Code, with respect to such Plan; (ii) there has been no non-exempt
"prohibited transaction" within the meaning of Section 406 of ERISA or Section
4975 of the Code involving the assets of any Plan nor any "reportable event"
within the meaning of Section 4043 of ERISA with respect to any Plan; (iii) all
required employer contributions to such Plan have been made (or, in the case of
contributions not yet due, have been accrued on the Balance Sheet); (iv) THI has
made available to TOC as to each such Plan a true and correct copy of (w) the
annual report (Form 5500) filed with the IRS for each of the three most recent
plan years, (x) each plan, trust agreement, group annuity contract and insurance
contract, if any, relating to such Plan, (y) each actuarial report prepared for
each of the last three years for each Plan and (z) each summary plan description
distributed to participants in each Plan and each summary of material
modifications to each Plan (as defined in ERISA); and (v) each such Plan is, and
at all relevant times has been, in compliance with ERISA, the Code and the terms
of such Plan. Neither THI nor the Companies or their respective affiliates has
ever participated in a "multiemployer pension plan" as defined in Section 3(37)
of ERISA.
(c) Each Plan applicable to employees of the Companies outside of the
United States is fully funded, has been administered, in all material respects,
in compliance with its terms and the requirements of all applicable laws and
regulations and all required contributions have been made. All reports, forms
and other documents required to be filed or advisable to be filed with any
governmental entity with respect to each such Plan have been timely filed and
are complete and accurate in all material respects.
(d) Except as set forth on the Disclosure Schedule, the Companies
have no obligation to provide any welfare benefits to retired or former
employees other than continuation of welfare benefits as required by applicable
law.
(e) The Companies have no liability under or with respect to any
employee benefit plans or arrangements that it no longer maintains or in which
it no longer participates.
2.17 Agreements and Documents. THI has previously furnished or made
available to TOC true, correct and complete copies of each document that is
referred to or otherwise related to any of the following items referred to in
this Section 2.17:
(a) each document related to interests in real property owned, leased
or otherwise used or claimed by the Companies;
(b) (i) each agreement of the Companies made in the ordinary course
of business which involves aggregate future payments by or to the Companies of
more than two hundred fifty thousand dollars ($250,000) or any agreement made in
the ordinary course of business whose term extends beyond one year after the
date hereof; (ii) each agreement containing any covenant restricting the freedom
of the Companies to compete in any line of business or with any person; and
(iii) each agreement of the Companies not made in the ordinary course of
business which is or was to be performed after the date hereof;
(c) all employment or similar compensation agreements of the
Companies which may not be terminated by the Companies without penalty within
thirty days after the Closing;
(d) all bonus, incentive compensation, deferred compensation,
profit-sharing, stock option, retirement, pension, severance, indemnification,
insurance, death benefit or other fringe benefit plans, agreements or
arrangements of the Companies (or applying to the Companies) in effect, or under
which any amounts remain unpaid, on the date hereof or to become effective after
the date hereof;
(e) all labor unions or other organizations representing, purporting
to represent or attempting to represent any employees of the Companies, and all
collective bargaining agreements of the Companies with any labor unions or other
representatives or employees;
(f) each agreement or other instrument or arrangement defining the
terms on which any indebtedness of the Companies (or a guarantee by either
Company of indebtedness) is or may be issued; and
(g) the names and addresses of all banks in which the Companies have
accounts or lines of credit, and with respect to each such account or line of
credit, the names of all persons authorized to draw thereon.
The Companies are not a party to any oral contract or agreement which
would be required to have been furnished or made available to TOC under this
Section 2.17 had such contract or agreement been committed to writing.
2.18 Validity. There is no default or claimed or purported or alleged
default, or basis on which with notice or lapse of time or both (including
notice of this Agreement), a default would exist, in any obligation on the part
of any party (including the Companies) to be performed under any lease,
contract, plan, policy or other instrument or arrangement referred to in Section
2.17 or otherwise in this Agreement.
2.19 No Changes. Since the date of the Balance Sheet there
has not been:
(a) any material adverse change in the business of the
Companies taken as a whole;
(b) any material damage, destruction or loss (whether or not covered
by insurance) adversely affecting the business of the Companies taken as a
whole;
(c) any declaration, setting aside or payment of any dividend, or
other distribution, in respect of any equity capital or capital stock of the
Companies or any direct or indirect redemption, purchase or other acquisition of
such capital or stock;
(d) any option to purchase any capital stock of the Companies granted
to any person, or any employment or deferred compensation agreement entered into
between each of the Companies and any of their stockholders, officers,
directors, employees or consultants;
(e) any issuance or sale by the Companies of any stock, bonds or
other corporate securities, or any partial or complete formation, acquisition,
disposition or liquidation of the Companies;
(f) any labor union activity (including without limitation any
negotiation, or request for negotiation, with respect to any union
representation or any labor contract) respecting the Companies;
(g) any statute, rule or regulation, or, to the best knowledge of the
Companies and THI, any government policy, adopted which may materially and
adversely affect the business of the Companies;
(h) any mortgage, lien, attachment, pledge, encumbrance or security
interest created on any asset, tangible or intangible, of the Companies, or
assumed, either by the Companies or by others, with respect to any such assets,
except for liens permitted under Section 2.8;
(i) any indebtedness or other liability or obligation (whether
absolute, accrued, contingent or otherwise) incurred, or other transaction
(except that is reflected in this Agreement) engaged in, by the Companies,
except those in the ordinary course of business that are individually, or in the
aggregate to one group of related parties, less than one hundred thousand
dollars ($100,000);
(j) any obligation or liability discharged or satisfied by the
Companies, except items included in current liabilities shown on the Balance
Sheet and current liabilities incurred since the date of the Balance Sheet in
the ordinary course of business which are individually, or in the aggregate to
one group of related parties, less than one hundred thousand dollars ($100,000)
in amount;
(k) any sale, assignment, lease, transfer or other disposition of any
tangible asset of the Companies, except in the ordinary course of business, or
any sale, assignment, lease, transfer or other disposition of its patents,
trademarks, trade names, brand names, copyrights, licenses or other intangible
assets;
(l) any amendment, termination or waiver of any material right
belonging to the Companies;
(m) any increase in the compensation or benefits payable or to become
payable by the Companies to any of their officers or employees; and
(n) any other action or omission by the Companies, or the passage of
any resolution, other than in the ordinary course of business.
2.20 Litigation or Proceedings. The Companies are not engaged in, or a
party to, or, to the best of THI's and each Company's knowledge, threatened
with, any claim or legal action or other proceeding before any court, any
arbitrator of any kind or any governmental authority, nor does any basis for any
claim or legal action or other proceeding or governmental investigation exist.
There are no orders, rulings, decrees, judgments or stipulations to which the
Companies are a party by or with any court, arbitrator or governmental authority
affecting the Companies.
2.21 Compliance with Laws. The Companies (i) have not been and are not in
violation of any applicable building, zoning, occupational safety and health,
pension, export control, environmental or other federal, state, local or foreign
law, ordinance, regulation, rule, order or governmental policy applicable to it;
(ii) have not received any complaint from any governmental authority, and to the
best knowledge of THI and each of the Companies, none is threatened, alleging
that the Companies have violated any such law, ordinance, regulation, rule,
order or governmental policy; (iii) have not received any notice from any
governmental authority of any pending proceedings to take all or any part of the
properties of the Companies (whether leased or owned) by condemnation or right
of eminent domain and, to the best knowledge of THI and each of the Companies,
no such proceeding is threatened; and (iv) are not a party to any agreement or
instrument, or subject to any charter or other corporate restriction or
judgment, order, writ, injunction, rule, regulation, code or ordinance, which
materially and adversely affects, or might reasonably be expected materially and
adversely to affect the business of the Companies.
2.22 Labor Matters. There are no labor organizing activities, election
petitions or proceedings, labor strikes, disputes, slowdowns, work stoppages or
unfair labor practice complaints pending or, to the best knowledge of THI and
the Companies, threatened against the Companies or between the Companies and any
of their respective employees.
2.23 Recalls. There is no basis for the recall, withdrawal or suspension
of any approval by any governmental authority with respect to any product sold
or proposed to be sold by the Companies. None of the products of the Companies
is subject to any recall proceedings and to the best knowledge of each of the
Companies, no such proceedings have been threatened.
2.24 Brokers and Finders. Neither THI nor the Companies has employed any
broker, agent or finder or incurred any liability on behalf of THI or the
Companies or for any brokerage fees, agents' commissions or finders' fees in
connection with the transactions contemplated hereby.
2.25 Powers of Attorney. The Companies have no powers of attorney or
similar authorizations outstanding.
2.26 No Termination of Relationship. As of the date hereof, neither THI
nor the Companies has any reason to expect that any relationship between the
Companies and a material distributor, customer, supplier, lender, employee or
other person will be terminated or adversely affected as a result of the
transactions contemplated by this Agreement.
2.27 All Information. TOC has been furnished in writing prior to the
execution of this Agreement all information as to the business of the Companies
material to a reasonable buyer's determination to enter into this Agreement and
to consummate the transactions contemplated hereby.
2.28 Statements True and Correct. The statements contained herein or in
any written documents prepared and delivered by or on behalf of THI pursuant to
the terms hereof are true, complete and correct in all material respects, and
such documents do not omit any material fact required to be stated herein or
therein or necessary to make the statements contained herein or therein not
misleading.
SECTION 3 - REPRESENTATIONS AND WARRANTIES OF TOC
TOC represents and warrants to THI as follows.
3.1 Organization. TOC is a corporation duly organized, validly existing
and in good standing under the laws of the state of Delaware and has full
corporate power and authority to own, lease and operate its assets and to carry
on its business as now being and as heretofore conducted.
3.2 Authority. TOC has full right, power, capacity and authority to
execute, deliver and perform this Agreement and to consummate the transactions
contemplated hereby. The execution, delivery and performance of this Agreement
and the consummation of the transactions contemplated hereby have been duly and
validly authorized by all necessary corporate action on the part of TOC. This
Agreement has been duly and validly executed and delivered by TOC and
constitutes the valid and binding obligation of TOC, enforceable against it in
accordance with the terms hereof. Neither the execution, delivery and
performance of this Agreement nor the consummation of the transactions
contemplated hereby will (i) conflict with or result in a violation, breach,
termination or acceleration of, or default under (or would result in a
violation, breach, termination, acceleration or default with the giving of
notice or passage of time, or both) any of the terms, conditions or provisions
of the Certificate of Incorporation or By-laws of TOC, as amended, or of any
note, bond, mortgage, indenture, license, agreement or other instrument or
obligation to which TOC is a party or by which TOC or any of its properties or
assets may be bound or affected; (ii) result in the violation of any order,
writ, injunction, decree, statute, rule or regulation applicable to TOC or any
of its properties or assets; or (iii) result in the imposition of any lien,
encumbrance, charge or claim upon any of its assets. Except for the listing of
the Purchase Price Shares for trading on the American Stock Exchange (the
"AMEX"), no consent or approval by, or notification to or filing with, any
court, governmental authority or third party is required in connection with the
execution, delivery and performance of this Agreement by TOC or the consummation
of the transactions contemplated hereby. The Purchase Price Shares will be, when
issued in accordance with this Agreement, duly authorized, validly issued, fully
paid, nonassessable and free of pre-emptive rights.
3.3 Statements True and Correct. The statements contained herein or in any
written documents prepared and delivered by or on behalf of TOC pursuant to the
terms hereof are true, complete and correct in all material respects, and such
documents do not omit any material fact required to be stated herein or therein
or necessary to make the statements contained herein or therein not misleading.
SECTION 4 - COVENANTS AND AGREEMENTS
4.1 Conduct of Business. Except with the prior written consent of TOC,
which will not be unreasonably withheld or delayed, and except as otherwise
contemplated herein, during the period from the date hereof to the Closing, THI
shall cause the Companies to observe the following covenants:
(a) Affirmative Covenants Pending Closing. THI and
each of the Companies shall:
(i) Preservation of Personnel. Use all reasonable efforts to
preserve intact the business organization of the Companies and keep available
the services of the present employees of the Companies, in each case in
accordance with past practice, it being understood that the termination of
employees with poor performance ratings shall not constitute a violation of this
covenant;
(ii) Insurance. Use all reasonable efforts to keep in effect
casualty, public liability, worker's compensation and other insurance policies
applicable to the Companies in coverage amounts not less than those in effect at
the date of this Agreement;
(iii)Preservation of the Business; Maintenance of Properties.
Except as set forth in Section 4.1(b)(i), use all reasonable efforts to preserve
the business of the Companies, advertise, promote and market its products and
services in accordance with past practices over the last twelve months, keep
their properties intact, preserve their goodwill, maintain all physical
properties in such operating condition as will permit the conduct of such
business on a basis consistent with past practice;
(iv) Intellectual Property Rights. Use all
reasonable efforts to preserve and protect the Proprietary Rights
of the Companies; and
(v) Ordinary Course of Business. Operate the business of the
Companies solely in the ordinary course.
(b) Negative Covenants Pending Closing. THI shall cause the Companies
not to:
(i) Disposition of Assets. Sell or transfer, or mortgage, pledge
or create or permit to be created any lien on, any of the assets of the
Companies other than:
(A) sales or transfers in the ordinary
course of business; and
(B) the creation of liens under existing
arrangements disclosed hereunder and liens permitted under
Section 2.8;
(ii) Liabilities. Permit the Companies to (A) incur any
obligation or liability other than in the ordinary course of business, (B) incur
any indebtedness for borrowed money in excess of $100,000 or (C) enter into any
contracts or commitments involving payments by the Companies of $100,000 or more
other than purchase orders and commitments for inventory, materials and supplies
in the ordinary course of business;
(iii)Compensation. Except as required by applicable law or any
existing employment or severance agreement, (A) change the compensation or
fringe benefits of any officer, director, employee or agent of the Companies,
except for ordinary merit increases for employees other than officers based on
periodic reviews in accordance with past practices, or (B) enter into or modify
any employment, severance or other agreement with any officer, director or
employee of the Companies or any benefit plan (it being understood that hiring
of at will employees in the ordinary course of business shall not constitute a
violation of this covenant) or (C) enter into or modify any agreement with any
consultant, except for agreements terminable upon not more than one year's
notice that are consistent with past practices with respect to consulting
agreements;
(iv) Equity Capital and Capital Stock. Make any change in the
authorized equity capital or the authorized, issued or outstanding number of
shares of capital stock of the Companies or grant any option, warrant or other
right to purchase, or to convert any obligation into, equity or shares of
capital stock of the Companies, or declare or pay any dividend or other
distribution with respect to any equity or shares of capital stock of the
Companies, or sell or transfer any equity or shares of its capital stock;
(v) Organizational Documents. Amend the
organizational documents of the Companies;
(vi) Acquisitions. Make any material acquisition of property
other than in the ordinary course of the business of the Companies and other
than Xxxxx'x acquisition of all of the equity capital of RHEO S.A. ("RHEO") in
accordance with the terms of a share purchase agreement between Xxxxx and RHEO;
(vii)License Agreements. Enter into or modify any
license, technology development or technology transfer agreement
between the Companies and any other person or entity;
4.2 Corporate Examinations and Investigations. Prior to the Closing, TOC
shall be entitled, through its employees and representatives, to have such
access to the assets, properties, business and operations of the Companies, as
is reasonably necessary or appropriate in connection with its investigation of
the Companies with respect to the transaction contemplated hereby. Any such
investigation and examination shall be conducted at reasonable times and under
reasonable circumstances so as to minimize any disruption to or impairment of
the business and each party shall cooperate fully therein. No investigation by
TOC shall diminish or obviate any of the representations, warranties, covenants
or agreements of THI contained in this Agreement. In order that TOC may have
full opportunity to make such investigation, THI shall furnish the
representatives of TOC with all such information and copies of such documents
concerning the affairs of the Companies as TOC may reasonably request and cause
its officers, employees, consultants, agents, accountants and attorneys to
cooperate fully with TOC's representatives in connection with such
investigation.
4.3 Expenses. TOC and THI shall bear their respective expenses incurred in
connection with the preparation, execution and performance of this Agreement and
the transactions contemplated hereby, including without limitation, all fees and
expenses of agents, representatives, counsel and accountants.
4.4 Authorization from Others. Prior to the Closing, the parties shall use
all reasonable efforts to obtain all authorizations, consents and permits of
others required to permit the consummation of the transactions contemplated by
this Agreement.
4.5 Consummation of Agreement. Each party shall use all reasonable efforts
to perform and fulfill all conditions and obligations to be performed and
fulfilled by it under this Agreement and to ensure that to the extent within its
control or capable of influence by it, no breach of any of its respective
representations, warranties and agreements hereunder occurs or exists on or
prior to the Closing, all to the end that the transactions contemplated by this
Agreement shall be fully carried out in a timely fashion.
4.6 Further Assurances. Each of the parties shall execute such documents,
further instruments of transfer and assignment and other papers and take such
further actions as may be reasonably required or desirable to carry out the
provisions hereof and the transactions contemplated hereby.
4.7 Listing of Purchase Price Shares. Promptly after the date hereof, TOC
shall take all action necessary to list the Purchase Price Shares for trading
upon the AMEX.
4.8 Public Announcements and Confidentiality. Any press release or other
information to the press or any third party with respect to this Agreement or
the transactions contemplated hereby shall require the prior approval of TOC and
THI, which approval shall not be unreasonably withheld, provided that a party
shall not be prevented from making such disclosure as it shall be advised by
counsel is required by law.
4.9 No Solicitation. Neither THI nor the Companies will (i) solicit or
initiate discussions with any person, other than TOC, relating to the possible
acquisition of the Companies or all or a material portion of the assets or any
of the equity or capital stock of the Companies or any merger or other business
combination with the Companies (an "Acquisition Transaction") or (ii) except to
the extent reasonably required by fiduciary obligations under applicable law as
advised by legal counsel, participate in any negotiations regarding, or furnish
to any other person information with respect to, any effort or attempt by any
other person to do or to seek any Acquisition Transaction. THI agrees to inform
TOC within one business day of its receipt of any offer, proposal or inquiry
relating to any Acquisition Transaction.
4.10 Indemnification.
(a) Right to Indemnification. TOC and THI (as the case may be, the
"Indemnitee") shall be indemnified on its respective demand made to the other
(the "Indemnitor") for the full amount of all damages (as defined below)
suffered by it as a direct or indirect result of:
(i) the inaccuracy of any representation or
warranty made by the Indemnitor in or pursuant to this Agreement;
and
(ii) any failure by the Indemnitor to perform any obligation or
comply with any covenant or agreement specified in this Agreement.
For the purpose of this Section 4.10, the term "damages" shall be determined and
computed by reference to the effect of the compensable event on the Indemnitee,
and shall be deemed to include (i) all losses, liabilities, expenses or costs
incurred by the Indemnitee, including reasonable attorneys' fees, and (ii)
interest at the 90-Day Commercial Composite Rate plus 25 basis points, set at
the beginning of each quarter, from the date 30 days after notice of any such
claim for indemnification is given to the Indemnitor, or if an unliquidated
claim, from such later date as the claim is liquidated, to the date full
indemnification is made therefor.
(b) Indemnification Procedures. The Indemnitee shall give the
Indemnitor notice of any claim, action or proceeding by a third party which is
reasonably likely to result in a claim for indemnification under this Section
4.10. The Indemnitor shall have the right, at its expense, to defend, contest,
protest, settle and otherwise control the resolution of any such claim, action
or proceeding. The Indemnitee shall have the right to participate in any such
legal proceeding, subject to the Indemnitor's right of control thereof, at the
expense of the Indemnitee and with counsel selected by the Indemnitee.
(c) Limitations on Indemnification. Each of TOC and THI shall be
obligated to indemnify the other pursuant to this Section 4.10 only with respect
to claims as to which it is given written notice by the Indemnitee on or prior
to a date two years after the Closing.
4.11 Tax-Free Qualification. THI and TOC agree that they will take no
actions not contemplated by this Agreement that would cause the transaction not
to qualify as a tax-free reorganization under Section 368 of the Internal
Revenue Code.
SECTION 5 - CONDITIONS PRECEDENT TO THE OBLIGATIONS OF TOC
The obligation of TOC to acquire the Shares is subject to the satisfaction
or waiver, at or before the Closing, of the following conditions:
5.1 Representations, Warranties and Covenants. The representations and
warranties of THI contained in this Agreement shall be true and correct in all
material respects on and as of the Closing with the same force and effect as
though made on and as of the Closing (with such exceptions as may be permitted
under or contemplated by this Agreement) and there shall not have been any
material adverse change in the business of the Companies taken as a whole since
the date hereof. THI shall have performed and complied in all material respects
with all covenants and agreements required by this Agreement to be performed or
complied with by it on or prior to the Closing and shall have obtained all
required consents and approvals. THI shall have delivered to TOC a certificate,
dated the date of the Closing, to the foregoing effect.
5.2 Certificates. THI shall have furnished TOC with such certificates of
public officials and of THI's or the Companies' officers as may be reasonably
requested by TOC.
SECTION 6 - CONDITIONS PRECEDENT TO THE OBLIGATION OF THI
The obligation of THI to sell the Shares is subject to the satisfaction or
waiver, at or before the Closing, of the following conditions:
6.1 Representations, Warranties and Covenants. The representations and
warranties of TOC contained in this Agreement shall be true and correct in all
material respects on and as of the Closing with the same force and effect as
though made on and as of the Closing (with such exceptions as may be permitted
under or contemplated by this Agreement). TOC shall have performed and complied
in all material respects with all covenants and agreements required by this
Agreement to be performed or complied with by it on or prior to the Closing and
shall have obtained all required consents and approvals. TOC shall have
delivered to THI a certificate, dated the date of the Closing, to the foregoing
effect.
6.2 Certificates. TOC shall have furnished THI with such certificates of
public officials and of TOC's officers as may be reasonably requested by THI.
SECTION 7 - TERMINATION, AMENDMENT AND WAIVER
7.1 Termination. This Agreement may be terminated at any time prior to the
Closing as follows:
(a) by THI upon written notice to TOC if TOC has materially breached
any representation, warranty, covenant or agreement contained herein and has not
cured such breach within ten (10) business days of receipt of written notice
from THI;
(b) by TOC upon written notice to THI if THI has materially breached
any representation, warranty, covenant or agreement contained herein and has not
cured such breach within ten (10) business days of receipt of written notice
from TOC;
(c) by either party if any court of competent jurisdiction or United
States or foreign governmental body shall have issued an order, decree or ruling
or taken any other action restraining, enjoining or otherwise prohibiting the
sale of any of the Shares and such order, decree or ruling shall have become
final and nonappealable; or
(d) at any time with the written consent of TOC and THI.
7.2 Effect of Termination. If this Agreement is terminated as provided in
Section 7.1, this Agreement shall forthwith become void and have no effect,
without liability on the part of any party, its directors, officers or
stockholders, other than the provisions of this Section 7.2, Section 4.3
relating to expenses and Section 4.8 relating to publicity and confidentiality
to the extent provided therein. Nothing contained in this Section 7.2 shall
relieve any party from liability for any breach of this Agreement occurring
before such termination.
7.3 Amendment. This Agreement may not be amended except by an instrument
signed by each of the parties hereto.
7.4 Waiver. At any time, any party hereto may (a) extend the time for the
performance of any of the obligations or other acts of any other party hereto or
(b) waive compliance with any of the agreements of any other party or any
conditions to its own obligations, in each case only to the extent such
obligations, agreements and conditions are intended for its benefit; provided
that any such extension or waiver shall be binding upon a party only if such
extension or waiver is set forth in a writing executed by such party.
SECTION 8 - MISCELLANEOUS
8.1 Notices. All notices, requests, demands, consents and other
communications which are required or permitted hereunder shall be in writing,
and shall be deemed given when actually received or if earlier, one day after
deposit with a nationally recognized air courier or express mail, charges
prepaid or three days after deposit in the U.S. mail by certified mail, return
receipt requested, postage prepaid, addressed as follows:
If to THI:
Thermo Instrument Systems Inc.
000 Xxxxxxx Xxxxxxx
Xxxxx 000
Xxxxx, Xxxxx 00000
Attention: President
If to TOC:
Thermo Optek Corporation
0 Xxxx Xxxxx Xxxxxxx
Xxxxxxxx, XX 00000
Attention: President
or to such other address as any party hereto may designate in writing to the
other parties, specifying a change of address for the purpose of this Agreement.
8.2 Survival and Materiality of Representations. Each of the
representations, warranties and agreements made by the parties hereto shall be
deemed material and shall survive the Closing and the consummation of the
transactions contemplated hereby. All statements contained in any certificates
or other instruments delivered by or on behalf of the parties pursuant hereto or
in connection with the transactions contemplated hereby shall be deemed material
and shall constitute representations and warranties by the person making such
statement.
8.3 Entire Agreement. This Agreement, including the exhibits, the
Disclosure Schedule and the other documents referred to herein, supersedes any
and all oral or written agreements or understandings heretofore made relating to
the subject matter hereof and constitutes the entire agreement of the parties
relating to the subject matter hereof.
8.4 Parties in Interest. All covenants and agreements, representations and
warranties contained in this Agreement made by or on behalf of any of the
parties hereto shall bind and inure to the benefit of the parties hereto, and
their respective successors, assigns, heirs, executors, administrators and
personal representatives, whether so expressed or not.
8.5 No Implied Rights or Remedies. Except as otherwise expressly provided
herein, nothing herein expressed or implied is intended or shall be construed to
confer upon or to give any person, firm or corporation, other than the parties
hereto, any rights or remedies under or by reason of this Agreement.
8.6 Headings. The headings in this Agreement are inserted for convenience
of reference only and shall not be a part of or control or affect the meaning
hereof.
8.7 Severability. If any provision of this Agreement shall be declared
void or unenforceable by any judicial or administrative authority, the validity
of any other provision shall not be affected thereby.
8.8 Counterparts. This Agreement may be executed in several counterparts,
each of which shall be deemed an original, but all of which together shall
constitute one and the same instrument.
8.9 Further Assurances. THI will execute and furnish to TOC all documents
and will do or cause to be done all other things that TOC may reasonably request
from time to time in order to give full effect to this Agreement and to
effectuate the intent of the parties.
8.10 Governing Law. This Agreement shall be governed by the law of the
State of Delaware applicable to agreements made and to be performed wholly
within such jurisdiction, without regard to the conflicts of laws provisions
thereof.
[Remainder of Page Intentionally Left Blank.]
IN WITNESS WHEREOF, the parties have caused this Agreement to be duly executed
as of the date first written above.
THERMO OPTEK CORPORATION
By: /s/ Xxxxxx X. Xxxxxxxxx
Name:Xxxxxx X. Xxxxxxxxx
Title: President
THERMO INSTRUMENT SYSTEMS INC.
By: /s/ Xxxx X. Xxxxx
Name:Xxxx X. Xxxxx
Title: President
TOC-3509
