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Exhibit 2.1
ASSET PURCHASE AGREEMENT
by and between
INTERPOOL, INC.
and
TRANSPORT INTERNATIONAL POOL, INC.
Dated as of January 26, 2001
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TABLE OF CONTENTS
Page
ARTICLE I
DEFINITIONS............................................................1
Section 1.1 Definitions.........................................1
Section 1.2 Other Definitional Provisions......................11
ARTICLE II
SALE OF ASSETS; ASSUMPTION OF LIABILITY; PURCHASE PRICE...............11
Section 2.1 Sale and Purchase of Acquired Assets...............12
Section 2.2 Excluded Assets....................................13
Section 2.3 Assumption of Liabilities..........................13
Section 2.4 Excluded Liabilities...............................14
Section 2.5 Purchase Price.....................................15
Section 2.6 Closing............................................17
Section 2.7 Post Closing Purchase Price Adjustment.............17
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF SELLER..............................20
Section 3.1 Organization, Power................................20
Section 3.2 Authority Relative to Agreement....................20
Section 3.3 Non-Contravention..................................21
Section 3.4 Consents...........................................21
Section 3.5 Litigation.........................................22
Section 3.6 Compliance with Laws; Permits and Licenses.........22
Section 3.7 Warranty Claims....................................23
Section 3.8 Employees; Employee Benefits.......................23
Section 3.9 Taxes..............................................24
Section 3.10 Material Contracts................................24
Section 3.11 Title to Acquired Assets; Absence of
Encumbrances; Acquired Assets.....................26
Section 3.12 Environmental.....................................27
Section 3.13 Intellectual Property.............................28
Section 3.14 Brokers...........................................28
Section 3.15 No Regulatory Impediment..........................28
Section 3.16 Absence of Certain Changes or Events...............28
Section 3.17 Financial and Business Information................28
Section 3.18 Insurance.........................................29
Section 3.19 Conduct of Business...............................29
Section 3.20 Indebtedness......................................29
Section 3.21 Accuracy of Transamerica Representations and
Warranties........................................29
Section 3.22 NS Sublease.......................................29
Section 3.23 Transamerica Agreement............................29
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF PURCHASER...........................29
Section 4.1 Organization.......................................29
Section 4.2 Authority Relative to Agreement....................30
Section 4.3 Non-Contravention..................................30
Section 4.4 Consents...........................................30
Section 4.5 Brokers............................................31
Section 4.6 Availability of Funds..............................31
Section 4.7 No Regulatory Impediment...........................31
Section 4.8 Litigation.........................................31
Section 4.9 Transamerica Agreement..............................31
ARTICLE V
COVENANTS.............................................................31
Section 5.1 Conduct of Business................................31
Section 5.2 Access; Confidentiality; Cooperation...............33
Section 5.3 Taking of Necessary Action.........................33
Section 5.4 Release of Seller from Assumed Liabilities.........35
Section 5.5 Insurance; Risk of Loss............................36
Section 5.6 Mail; Payments.....................................36
Section 5.7 License of Interpool Name..........................37
Section 5.8 Registration.......................................38
Section 5.9 Assigned Contracts.................................38
Section 5.10 Bulk Sales Waiver.................................38
Section 5.11 Public Announcements..............................38
Section 5.12 Notices of Certain Events.........................39
Section 5.13 Further Assurances................................39
Section 5.14 Transition Services Agreement.....................39
Section 5.15 Pacer Joint Venture...............................39
Section 5.16 Covenant Not to Compete............................40
Section 5.17 Licenses and Titles...............................42
ARTICLE VI
EMPLOYEE MATTERS......................................................42
Section 6.1 Business Employees.................................42
Section 6.2 Employment.........................................42
Section 6.3 Employee Benefits..................................43
Section 6.4 Workers' Compensation..............................43
ARTICLE VII
CONDITIONS TO THE CLOSING.............................................43
Section 7.1 Conditions of Obligation of Each Party.............43
Section 7.2 Additional Conditions to the Obligations
of Purchaser.......................................43
Section 7.3 Additional Conditions to the Obligations
of Seller..........................................44
ARTICLE VIII
TERMINATION, AMENDMENT AND WAIVER.....................................45
Section 8.1 Termination........................................45
Section 8.2 Effect of Termination..............................46
Section 8.3 Liquidated Damages.................................46
Section 8.4 Extension; Waiver..................................46
ARTICLE IX
TAX MATTERS...........................................................47
Section 9.1 Post-Closing Tax and Accounting Matters............47
Section 9.2 Allocation of Consideration........................47
ARTICLE X
INDEMNIFICATION.......................................................47
Section 10.1 By Seller for Transamerica Assets.................47
Section 10.2 By Seller for Interpool Assets....................49
Section 10.3 By Purchaser......................................50
Section 10.4 Indemnification Procedure.........................51
Section 10.5 Survival..........................................52
Section 10.6 Exclusivity.......................................53
Section 10.7 Environmental Indemnification Matters.............53
Section 10.8 Limitation on Representations and Warranties......54
ARTICLE XI
MISCELLANEOUS.........................................................54
Section 11.1 Amendment and Modification; Waiver of Provisions..54
Section 11.2 Expenses..........................................55
Section 11.3 Successors and Assigns; Assignments...............55
Section 11.4 No Third Parties Benefitted.......................55
Section 11.5 Notices...........................................55
Section 11.6 Law Governing.....................................56
Section 11.7 Counterparts......................................56
Section 11.8 Entire Agreement..................................57
Section 11.9 Choice of Forum; Waiver of Jury Trial.............57
Section 11.10 Headings.........................................57
Section 11.11 Severability.....................................57
DISCLOSURE SCHEDULES
Seller Disclosure Schedule
Section 1 Knowledge
Section 1.1(c) Permitted Encumbrances
Section 2.1(i) Assignable Agreements
Section 2.4(e) Pending Litigation
Section 2.5(e) Leased-In Equipment and Managed Equipment
Section 3.4(a) Governmental Authority
Section 3.4(b) Third Party Consents
Section 3.5 Litigation
Section 3.6 Acquired Assets
Section 3.7 Warranty Claims
Section 3.8 Employee Benefits
Section 3.10 Material Contracts
Section 3.10(c) Execution of Material Contracts
Section 3.10(d) Equipment Leases
Section 3.10(e) Knowledge of Seller in Material Contracts
Section 3.10(f) Lease Transactions and Government Agreements
Section 3.10(h) Payments
Section 3.11(a) Title to Acquired Assets
Section 3.11(b) Intermodal Assets
Section 3.11(c) Maintenance
Section 3.10(d) Modification to Transamerica Leases
Section 3.12(a) Environmental
Section 3.12(b) Summons and Claims to Seller's Knowledge
Section 3.12(c) Administrative or Judicial Judgements
Section 3.12(d) Material Adverse Effect
Section 3.12(e) Chicago and Atlanta Properties
Section 3.16 Absences of Certain Changes or Events
Section 3.17 Financial and Business Information
Section 3.18 Insurance
Section 3.21 Accuracy of Transamerica Representations and Warranties
Section 5.1 Conduct of Business Events
Section 5.4(a) Release of Seller from Assumed Liabilities
Section 5.4(b) Novated Non-Exclusive Contracts
Section 6.1 Business Employees
Section 7.2(d) Consents of Third Party
Section 10.7 Limits on Environmental Indemnification
Purchaser Disclosure Schedule
Section 4.4(a) Governmental Authority
Section 4.4(b) Third Party Consents
Section 4.8 Litigation
Section 10.7 Limits on Environmental Indemnification
LIST OF EXHIBITS
Exhibit A. Assigned Equipment Value
Exhibit B. New Purchased Equipment (contained on Section 5.1 of
Seller Disclosure Schedule)
Exhibit C. Scheduled Intermodal Assets (See Exhibit A)
Exhibit D. Transition Services Agreement
Exhibit E. Scheduled Exclusive Lease-in Transactions (contained on Section
5.4(a) of Seller Disclosure Schedule)
Exhibit F. Scheduled Non-Exclusive Lease-In Transactions
(contained on Section 5.4(b) of Seller Disclosure Schedule)
Exhibit G. Intentionally Omitted
Exhibit H. Stipulated Methodologies
ASSET PURCHASE AGREEMENT
Asset Purchase Agreement (this "Agreement"), dated as of
January 26, 2001, by and between Interpool, Inc., a Delaware corporation
("Seller"), and Transport International Pool, Inc., a Pennsylvania
corporation ("Purchaser").
W I T N E S S E T H:
WHEREAS, Seller and the Designated Subsidiaries own the
Acquired Assets; and
WHEREAS, Seller and the Designated Subsidiaries desire to
sell to Purchaser, and Purchaser agrees to purchase from Seller and the
Designated Subsidiaries, the Acquired Assets and to assume the Assumed
Liabilities.
NOW, THEREFORE, in consideration of the premises and of the
mutual covenants and agreements hereinafter set forth, the parties,
intending to be legally bound, hereby agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.1 DEFINITIONS. The following terms when used in
this Agreement shall have the following meanings:
"Actual Maintenance Expense" has the meaning set forth in
Section 2.5(f).
"Additional Equipment" has the meaning set forth in Section
2.7(b).
"Additional Payment Amount" has the meaning set forth in
Section 2.7(f).
"Accounting Firm" has the meaning set forth in Section 9.2.
"Acquired Assets" has the meaning set forth in Section 2.1.
"Affiliate" means, with respect to any Person, any other
Person controlling, controlled by or under common control with such Person.
For purposes of this definition, "control" (including with correlative
meaning, the terms "controlled by" and "under common control with") as used
with respect to any Person shall mean (a) the ownership of 50% or more of
the voting securities or other voting interests of such Person or (b) the
possession, directly or indirectly, of the power to direct or cause the
direction of management or policies of such Person, whether through
ownership of voting securities, by contract or otherwise.
"Agreement" has the meaning set forth in the Preamble.
"Allocation Agreement" has the meaning set forth in Section
9.2.
"Antitrust Division" has the meaning set forth in Section
5.3(c).
"Applicable Law" has the meaning set forth in Section 3.3.
"Assigned Equipment Value" means (i) with respect to any
item of Scheduled Intermodal Assets, the amount reflected on Exhibit A
hereto for the category, type and age corresponding to such item of
Scheduled Intermodal Assets, and (ii) with respect to any item of New
Purchased Equipment, the New Purchased Equipment Cost of such item.
"Assigned Management Agreement"has the meaning set forth in
Section 5.15(b).
"Assignment and Assumption Agreement" has the meaning set
forth in Section 2.6(b).
"Assumed Liabilities" has the meaning set forth in Section
2.3.
"Benefit Plan" has the meaning set forth in Section 3.8(a).
"Business Claims" has the meaning set forth in Section
5.5(b).
"Business Day" means any day which is not a Saturday, Sunday
or a day on which banks in New York City are authorized or obligated by law
or executive order to be closed.
"Business Employee" has the meaning set forth in Section
6.1.
"Business Liabilities" has the meaning set forth in Section
5.5(b).
"Cleanup" means all actions required by Environmental Laws
(based upon reasonable evidence of an actual or potential violation of
Environmental Laws or other Release or Third Party Environmental Claims)
to: (1) cleanup, remove, treat or remediate Hazardous Materials in the
Environment; (2) prevent the Release of Hazardous Materials so that they do
not migrate, endanger or threaten to endanger public health or welfare or
the Environment; (3) perform pre-remedial studies and investigations and
post-remedial monitoring and care; or (4) respond to any Governmental
Authority requests for information or documents in any way relating to
cleanup, removal, treatment or remediation or potential cleanup, removal,
treatment or remediation of Hazardous Materials in the Environment.
"Closing" has the meaning set forth in Section 2.6(a).
"Closing Date" has the meaning set forth in Section 2.6(a).
"Closing Date Schedule of Acquired Assets" means a schedule
of the intermodal trailers and domestic containers which constitute
Acquired Assets or which are the subject of a Management Agreement or a
Lease-In Transaction as of the close of business on the Closing Date and
which schedule (i) is delivered by Seller to Purchaser at least 5 Business
Days prior to the Closing Date and updated for occurrences through the
Closing Date and (ii) shall identify by category the Scheduled Intermodal
Assets, New Purchased Equipment, Leased-In Equipment, Managed Equipment,
Sold Equipment and Destroyed Equipment. The parties hereto acknowledge that
(i) although Seller will endeavor to make the Closing Date Schedule of
Acquired Assets accurate as of the close of business on the Closing Date,
the Closing Date Schedule of Acquired Assets may in fact reflect data that
is accurate as of a date that precedes the Closing Date, and (ii) any
changes to the data contained in the Closing Date Schedule of Acquired
Assets from the date as of which the Closing Date Schedule of Acquired
Assets is in fact actually prepared in accordance with preceding clause (i)
through to the close of business on the Closing Date are intended to be
counted for through the operation of Section 2.7 hereof.
"Closing Day Amount" has the meaning set forth in Section
2.5(b).
"Closing Day Schedule of Security Deposits" means a schedule
of the security deposits that may be refunded to customers after the
Closing Date under the Intermodal Exclusive Leases or in respect of
Intermodal Assets under the Intermodal Non-Exclusive Leases and which
schedule is delivered by Seller to Purchaser at least five Business Days
prior to the Closing Date.
"Code" means the Internal Revenue Code of 1986, as amended,
and the rules and regulations promulgated thereunder.
"Competitive Business" has the meaning set forth in Section
5.16(a).
"Confidentiality Agreement" means the Confidentiality
Agreement, dated November 16, 2000, between Seller and Purchaser.
"Consent Agreement" has the meaning set forth in Section
5.7(c).
"Container Lease" has the meaning set forth in Section
5.15(b).
"Contract" has the meaning set forth in Section 3.3.
"Designated Subsidiaries" means Interpool Acquisition,
L.L.C., a Delaware limited liability company, and Trac Lease, Inc., a
Delaware corporation.
"Destroyed Equipment" means any intermodal trailer or
domestic container which would otherwise constitute an Acquired Asset and
with respect to which Seller has received a notice, claim or statement that
such intermodal trailer or domestic container has been destroyed, the
subject of a "total loss" or otherwise damaged to such an extent so as to
render repairs thereto uneconomic or otherwise unfeasible and which
indicates that the casualty occurred prior to the Closing Date.
"Discovered Equipment" has the meaning set forth in Section
2.7(g).
"Disputed Amount" has the meaning set forth in Sect on
2.7(e).
"Domestic Containers" means (i) the Interpool Containers and
(ii) the Transamerica Containers.
"Encumbrances" means any mortgages, claims, liens, charges,
security interests, encumbrances, imperfections of or other matters
affecting title, and any rights of third parties whatsoever.
"Environment" means the ambient air, surface water,
groundwater, soils, surface or subsurface strata and the interior of a
building, except that the inside of a tank or container shall not be
considered the interior of a building.
"Environmental Laws" means any and all federal, state, local
and foreign statutes, laws, judicial, administrative and regulatory
decisions, regulations, ordinances, codes, licenses, authorizations and
approvals in either case having the force and effect of law and in each
case as in effect on the Closing Date or as in effect from time to time
after the Closing Date and which relate to the protection of the
environment (including, but not limited to natural resources) or human
health (as it relates to the environment) or to emissions, discharges,
releases or spills of Hazardous Materials into the environment.
"Equipment Leases" has the meaning set forth in Section
3.10(d).
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended.
"ERISA Affiliate" has the meaning set forth in Section
3.8(c).
"Excess New Equipment" has the meaning set forth in Section
2.5(e).
"Excluded Assets" has the meaning set forth in Section 2.2.
"Excluded Liabilities" has the meaning set forth in Section
2.4.
"FTC" has the meaning set forth in Section 5.3(c).
"Financing Lease" shall have the meaning set forth in
Section 5.16 hereof.
"GAAP" means United States generally accepted accounting
principles as of the date hereof.
"Governmental Authority" has the meaning set forth in
Section 3.3.
"Hazardous Materials" means any toxic, radioactive or
hazardous material or substance or waste, pollutant or contaminant,
petroleum or petroleum product, exposed friable asbestos as of the Closing
Date and any material or substances that are defined or listed in or
otherwise regulated or classified as hazardous, toxic or extremely
hazardous pursuant to any Environmental Law.
"HSR Act" has the meaning set forth in Section 5.3(c).
"Indebtedness" means (i) any and all obligations of
Interpool and its Affiliates under the Scheduled Exclusive Lease-In
Transactions to make payments to the other parties thereto with respect to
the rental of equipment thereunder, other than late payment fees and
similar charges owing as of the Closing and (ii) any and all obligations of
Interpool and its Affiliates under the Scheduled Non-Exclusive Lease-In
Transactions to make payments to the other parties thereto with respect to
the rental of Intermodal Assets thereunder. For the avoidance of doubt, the
portion of any payment under any Scheduled Non-Exclusive Lease-In
Transactions which is attributable to the rental of the Intermodal Assets
under such agreement shall equal the product obtained by multiplying the
amount of such payment by a fraction, (1) the numerator of which shall
equal the aggregate original purchase prices of all Intermodal Assets which
are the subject of such Scheduled Non-Exclusive Lease-In Transactions and
(2) the denominator of which shall equal the aggregate original purchase
prices of all equipment which is the subject of such Scheduled
Non-Exclusive Lease-In Transactions.
"Indebtedness Shortfall Amount" has the meaning set forth in
Section 2.5(c).
"Indemnified Costs" means Purchaser Transamerica Losses,
Purchaser Interpool Losses or Seller Losses, as the case may be.
"Instruments of Transfer" means the Assignment and
Assumption Agreement and any bills of sale, assignments, endorsements of
certificates of title and other instruments and documents delivered in
connection with the transactions contemplated by this Agreement.
"Intellectual Property" has the meaning set forth in Section
3.13.
"Intermodal Assets" means the Interpool Assets and the
Transamerica Assets, collectively.
"Intermodal Exclusive Leases" has the meaning set forth in
Section 2.1(d).
"Intermodal Trailers" means (i) the Interpool Trailers and
(ii) the Transamerica Trailers.
"Intermodal Leases" has the meaning set forth in Section
2.1(e).
"Intermodal Non-Exclusive Leases" has the meaning set forth
in Section 2.1(e).
"Interpool Assets" means (i) the Interpool Containers and
(ii) the Interpool Trailers.
"Interpool Container" means all domestic containers owned,
managed or leased-in by Seller as of the Closing (other than the
Transamerica Containers and other than the Excess New Equipment).
"Interpool Prefixes" means all alphabetical prefixes
imprinted on, and used by Seller to identify, the Interpool Assets, which
shall include the following BIC-registered prefixes: "BMDZ," IRMZ," "TPWZ,"
"BCYU," "EMPU," "HUBU," "IIIU," "NCIU," ""EMPU" and "INDU."
"Interpool Trademarks" means the trademarks and service
marks (registrations and applications), trade names, logos, designs,
slogans, domain names and other indicia of source or general intangibles of
like nature, together with all good will related to the foregoing owned by
or licensed (with the right to sublicense) to Interpool.
"Interpool Trailer" means all intermodal trailers owned,
managed or leased-in by Seller as of the Closing (other than the
Transamerica Trailers and other than the Excess New Equipment).
"IPX Review Period" has the meaning set forth in Section
2.7(i).
"IRS" means the Internal Revenue Service of the United
States of America or any successor agency or authority.
"Knowledge" as to Seller means the actual knowledge of the
employees of Seller or the Designated Subsidiaries listed in Section 1 of
the Seller Disclosure Schedule.
"Lease Transaction" means any customer lease (including any
schedule or amendment thereto or assignment, assumption, renewal or
novation thereof and any modification, amendment, supplement or letter
agreement thereof or thereto) in existence on or prior to the Closing Date
which constitutes an Acquired Asset, which is in the form of a lease or
rental, interchange, geographic pool or use agreement, arising out of the
lease or rental of Intermodal Assets and in each case, with respect thereto
Seller is (i) the lessor (or sublessor), obligee or owner (whether
initially or as assignee) or (ii) an assignee of the revenues or claims
with respect thereto.
"Leased-In Equipment" means any intermodal trailer or
domestic container that is the subject of a Lease-In Transaction.
"Lease-In Transaction" means any contract (including any
schedule or amendment thereto or assignment, assumption, renewal or
novation thereof and any modification, amendment, supplement or letter
agreement thereof or thereto) in existence on or prior to the Closing Date,
arising out of a lease (which constitutes an Acquired Asset) of any
intermodal trailer or domestic container and, in each case, the terms of
which provide that any Person (other than Seller and the Designated
Subsidiaries) is the lessor (or sublessor), obligee or owner thereunder and
Seller or a Designated Subsidiary is the lessee (or sublessee) or obligor
thereunder (whether initially or as assignee).
"Liabilities" has the meaning set forth in Section 2.3.
"License" has the meaning set forth in Section 5.7(a).
"License Term" has the meaning set forth in Section 5.7(a).
"Maintenance Shortfall Amount" has the meaning set forth in
Section 2.5(d).
"Managed Equipment" means any intermodal trailer or domestic
container that is owned by a Person other than Seller and the Designated
Subsidiaries and that is managed by Seller or any Designated Subsidiary for
the benefit of such Person pursuant to a Management Agreement.
"Management Agreement" means any agreement which constitutes
an Acquired Asset and pursuant to which Seller or any Designated Subsidiary
manages any intermodal trailer or domestic container (including any
schedule or amendment thereto or assignment, assumption, renewal or
novation thereof and any modification, amendment, supplement or letter
agreement thereof or thereto).
"Material Adverse Effect" means a material adverse effect on
the Acquired Assets together with the Assumed Liabilities, taken as a
whole(other than (a) as a result of changes (i) in prevailing interest
rates or financial market conditions, (ii) in general economic conditions
affecting any industry in which the Acquired Assets are operated or used,
(iii) in law or applicable regulations or the official interpretations
thereof or (iv) in GAAP or (b) as a result of the announcement or
expectation of the consummation of the transactions contemplated hereby (it
being understood that employee departures resulting from such announcement
or expectation shall not constitute, or be considered in determining
whether there has been, a Material Adverse Effect) or (c) changes in the
revenues associated with the Acquired Assets as a result of the seasonality
of the business associated with the Acquired Assets consistent with
historical patterns), it being understood that any determination of
Material Adverse Effect involving a reduction in revenues shall, with
respect to such reduction, only consider the revenues associated with the
Acquired Assets for the latest twelve month period preceding the then most
recent month-end as compared with the revenues associated with the Acquired
Assets for the twelve month period ended December 31, 2000.
"Material Contract" has the meaning set forth in Section
3.10(b).
"Missing and Additional Equipment Amount" has the meaning
set forth in Section 2.7(c).
"Missing and Additional Equipment Report" has the meaning
set forth in Section 2.7(c).
"Missing Equipment" has the meaning set forth in Section
2.7(b).
"Net Assets Adjustment Amount" has the meaning set forth in
Section 2.5(e).
"New Purchased Equipment" means the intermodal trailers and
domestic containers acquired by Seller or any Designated Subsidiary after
September 30, 2000 and prior to the Closing and that are reflected on the
Purchase Order Summary Report attached hereto as Exhibit B (as it may from
time to time be updated by (x) agreement of the parties or (y) Seller to
reflect purchase orders permitted pursuant to Section 5.1(b)(iv) hereof).
"New Purchased Equipment Cost" means the cost of each item
of New Purchased Equipment (net of all discounts, rebates, and commissions
and other reductions) as reflected on the books and records of Seller or a
Designated Subsidiary.
"Non-Compete Period" has the meaning set forth in Section
5.16(a)
"Novated Contracts" has the meaning set forth in Section
5.4(b).
"Novated Exclusive Contracts" has the meaning set forth in
Section 5.4(a).
"Novated Non-Exclusive Contracts" has the meaning set forth
in Section 5.4(b).
"Offsetting Recovery" has the meaning set forth in Section
10.1(b)(i).
"Pacer" has the meaning set forth in Section 5.15(a).
"PAMC Containers" has the meaning set forth in Section
5.15(b).
"PAMC Management Agreement" has the meaning set forth in
Section 5.15(b).
"Permits" means permits, certificates, licenses, approvals
and other authorizations of Governmental Authorities.
"Permitted Encumbrances" means (a) the lien of current Taxes
not yet due and payable, (b) with respect to any Intermodal Asset owned or
leased by Seller or the Designated Subsidiaries, the lease (which
constitutes a Contract) related to such Intermodal Asset, (c) operating
Lease-In Transactions, Lease Transactions and Management Contracts relating
to Intermodal Assets owned by third parties, (d) Encumbrances disclosed in
Section 1.1(c) of the Seller Disclosure Schedule and (e) such other
imperfections of title and other Encumbrances, if any, which, individually
or in the aggregate, do not (i) impair the ability to sell such Acquired
Assets in the ordinary course or (ii) materially impair (x) the value of
the Acquired Assets or (y) the use of the Acquired Assets in the ordinary
course of business consistent with past practices.
"Person" means any individual, corporation, partnership,
joint venture, association, joint stock company, limited liability company
or other form of entity, trust, unincorporated organization or government
or any agency or political subdivision thereof.
"Premium Recapture" has the meaning set forth in Section
10.1(b)(i).
"Proposed Allocation" has the meaning set forth in Section
9.2.
"Purchase Price" has the meaning set forth in Section
2.5(a).
"Purchaser" has the meaning set forth in the Preamble.
"Purchaser Disclosure Schedule" means the disclosure
schedule delivered by Purchaser to Seller at the time of execution hereof.
"Purchaser Indemnified Parties" has the meaning set forth in
Section 10.1(a).
"Purchaser Interpool Losses" has the meaning set forth in
Section 10.2(a).
"Purchaser Transamerica Losses" has the meaning set forth in
Section 10.1(a).
"Rebill Claim Report" has the meaning set forth in Section
2.7(i).
"Rebill Disputed Amount" has the meaning set forth in
Section 2.7(i).
"Rebill Unresolved Dispute Notice Date" has the meaning set
forth in Section 2.7(i).
"Refund Amount" has the meaning set forth in Section 2.7(f).
"Release" means any release, spill, emission, discharge,
leaking, pumping, injection, deposit, disposal, dispersal, leaching or
migration of Hazardous Materials into the Environment or into or out of any
property, including the movement of Hazardous Materials through or in the
Environment.
"Representatives" has the meaning set forth in Section 8.2.
"Repurchase Amount" has the meaning set forth in Section
2.7(h).
"Required Maintenance Expense" has the meaning set forth in
Section 2.5(d).
"Revenues" has the meaning set forth in Section 2.7(g).
"Scheduled Exclusive Lease-In Transactions" has the meaning
set forth in Section 2.1(f).
"Scheduled Intermodal Assets" means the domestic containers
and intermodal trailers owned, leased-in or managed by Seller as of
September 30, 2000 as reflected on Exhibit C hereto.
"Scheduled Lease-In Transactions" has the meaning set forth
in Section 2.1(f).
"Scheduled Non-Exclusive Lease-In Transactions" has the
meaning set forth in Section 2.1(f).
"Seller" has the meaning set forth in the Preamble.
"Seller Disclosure Schedule" means the disclosure schedule
delivered by Seller to Purchaser at the time of execution hereof.
"Seller Losses" has the meaning set forth in Section
10.3(a).
"Seller Review Period" has the meaning set forth in Section
2.7(e).
"Seller's Insurance Policies" has the meaning set forth in
Section 5.5(b).
"Seller Transamerica Loss" means any loss, cost deficiency,
demand, assessment, expense (including all reasonable legal and expert fees
and expenses), damage (including damages to Persons, property and the
environment), liability, fine, penalty or claim (but not including
consequential, punitive or special damages) incurred by Seller in
accordance with Section 11.1(a) of the Transamerica Agreement.
"Sold Equipment" means the intermodal trailers and domestic
containers sold by Seller or a Designated Subsidiary after September 30,
2000 and prior to the Closing as permitted by Section 5.1(b)(ii)(2) hereof.
"Stipulated Methodologies" has the meaning set forth in
Section 2.7(a).
"Subsidiary" means, with respect to any Person, corporation,
partnership, joint venture, limited liability company, other business
entity or other legal entity of which the outstanding shares of stock or
other equity interests having ordinary voting power to elect a majority of
the board of directors (or comparable body) of such corporation or other
entity are owned, directly or indirectly through one or more
intermediaries, by such entity.
"Tax Benefit" to a party means an amount by which the Tax
liability of such party (or group of Affiliates including such party) is
actually reduced (including by deduction, reduction of income by virtue of
increased tax basis or otherwise, entitlement to refund, credit or
otherwise) after taking into account any increase in such party's Tax
liability as a result of its receipt of any related indemnity payment plus
any related interest received from the relevant Taxing Authority. Where a
party has other losses, deductions, credits or items available to it, the
Tax Benefit from any losses, deductions, credits or items relating to the
Indemnified Costs shall be deemed to be realized on a pro rata basis with
any other losses, deductions, credits or items of such party (or group of
Affiliates including such party).
"Tax Returns" means all returns, declarations, reports,
estimates, information returns and statements required or other document
(including any related or supporting documentation) filed or to be filed in
connection with any determination, assessment or collection of any Tax.
"Taxes" means any and all federal, state, county,
provincial, local, foreign and other taxes, including all net income, gross
income, gross receipts, premium, estimated, sales, use, ad valorem,
property, transfer, franchise, profits, license, withholding, payroll,
employment, excise, severance, VAT, GST, consumption, stamp and occupation
taxes and customs duties, together with any interest, additions to tax or
interest, and penalties with respect thereto imposed by any Taxing
Authority and any Liability in respect of any of the foregoing amounts as a
transferee or as an indemnitor, guarantor or surety or in a similar
capacity under any Contract, arrangement, agreement, understanding or
commitment (whether oral or written).
"Taxing Authority" means any Governmental Authority having
jurisdiction over the assessment, determination, collection or other
imposition of Taxes.
"Termination Date" has the meaning set forth in Section
8.1(b).
"Transamerica" means Transamerica Leasing, Inc., a Delaware
corporation.
"Transamerica Agreement" means the Asset Purchase Agreement,
dated as of July 27, 2000, between Transamerica and Seller, as amended by
Amendment No. 1 thereto, dated as of October 24, 2000, including, in each
case, all exhibits, disclosure schedules and other attachments thereto.
"Transamerica Assets" means (i) the Transamerica Containers
and (ii) the Transamerica Trailers.
"Transamerica Closing Date" means October 24, 2000.
"Transamerica Leases" has the meaning set forth in Section
2.3(a).
"Transamerica License" has the meaning set forth in Section
5.7(c).
"Third Party Consents" has the meaning set forth in Section
3.4.
"Third Party Environmental Claim" means any claim, action,
cause of action, investigation or notice (written or oral) by any Person or
entity (other than a party to this Agreement or an Affiliate thereof)
relating to the Acquired Assets and alleging potential liability
(including, without limitation, potential liability for investigatory
costs, Cleanup costs, governmental response costs, natural resources
damages, property damages, personal injuries, or penalties) arising out of,
based on or resulting from the presence, or Release of any Hazardous
Materials in the Environment at any location, whether or not owned or
operated by Seller, in each case prior to the Closing.
"Transamerica Containers" means the domestic containers that
Seller purchased or acquired rights in respect of from Transamerica
pursuant to the Transamerica Agreement and which constitute an Acquired
Asset as of the Closing.
"Transamerica Matter" means the Transamerica Assets and any
other Acquired Asset or Assumed Liability which Seller or its Affiliates or
designees acquired or assumed pursuant to the Transamerica Agreement.
"Transamerica Names" means the terms "Transamerica,"
"Transamerica Leasing," "Trans Ocean," "Realco," "ICS" and such other names
that correspond to the Transamerica Prefixes.
"Transamerica Prefixes" means all of the alphabetical
prefixes imprinted on, and which had been used by Transamerica to identify,
the Transamerica Assets, which shall include the following BIC-registered
prefixes: "ICSU," "ICSZ," "IKSU," "NCHU," "NCRU," "XXXX," "XXXX," "RMPZ,"
"RTMZ," "RXXZ," "SMTZ," "TCPU," "TCPZ," "TDNZ," "TGPZ," "TMEZ," "TRLU,"
"TRZZ," "TSPZ," "TSSZ," "TSXZ" and "UTHZ."
"Transamerica Trademarks" means the Transamerica Names and
the corresponding trademarks (including other common law or statutory
trademark rights therein and derivations or stylizations thereof).
"Transamerica Trailers" means the intermodal trailers that
Seller purchased or acquired rights in respect of from Transamerica
pursuant to the Transamerica Agreement and which constitute an Acquired
Asset as of the Closing.
"Transferred Employees" has the meaning set forth in Section
6.2.
"Transition Services Agreement" means the Transition
Services Agreement by and between Purchaser and Seller in the form attached
hereto as Exhibit D.
"Unresolved Dispute Notice Date" has the date set forth in
Section 2.7(e).
"Verification Period"has the meaning set forth in Section
2.7(a).
SECTION 1.2 OTHER DEFINITIONAL PROVISIONS. (a) The words
"herein," "hereof," "hereto," and "hereunder" and words of similar import,
when used in this Agreement, shall refer to this Agreement as a whole and
not to any particular provision of this Agreement.
(b) The terms defined in the singular shall have a
comparable meaning when used in the plural, and vice versa.
(c) Whenever the words "include," "includes" or
"including" are used in this Agreement they shall be deemed to be followed
by the words "without limitation."
(d) The term "dollars" and the symbol "$" means U.S.
dollars, unless otherwise indicated.
(e) All terms defined in this Agreement shall have the
defined meanings contained herein when used in any certificate or other
document made or delivered pursuant hereto unless otherwise defined
therein.
(f) The definitions contained in this Agreement are
applicable to the masculine as well as to the feminine and neuter genders
of such term.
ARTICLE II
SALE OF ASSETS; ASSUMPTION OF LIABILITY; PURCHASE PRICE
SECTION 2.1 SALE AND PURCHASE OF ACQUIRED ASSETS. At the
Closing, Seller shall (and shall cause the Designated Subsidiaries to)
sell, transfer, assign, convey and deliver to Purchaser, and Purchaser
shall purchase and acquire from Seller and the Designated Subsidiaries, any
and all of Seller's and the Designated Subsidiaries' right, title and
interest in, to and under all of the assets of Seller and the Designated
Subsidiaries set forth below in this Section 2.1 (any and all such assets,
but excluding the Excluded Assets, the "Acquired Assets"):
(a) the Scheduled Intermodal Assets;
(b) New Purchased Equipment which is not Excess New
Equipment;
(c) Additional Equipment;
(d) all customer leases relating to the rental of
Intermodal Assets to which Seller or any of the Designated Subsidiaries is
a party or an assignee as of the Closing and the subject matter of which
relates exclusively to the rental of Intermodal Assets (other than the
Scheduled Lease- In Transactions) (such leases, the "Intermodal Exclusive
Leases"), to the extent that each such Intermodal Exclusive Lease is
assignable;
(e) the rights under customer leases relating to the
rental of Intermodal Assets to which Seller or any of the Designated
Subsidiaries is a party or an assignee as of the Closing and the subject
matter of which relates non-exclusively to the rental of Intermodal Assets
but only insofar as such rights relate to Intermodal Assets (other than the
Scheduled Lease-In Transactions) (such leases, the "Intermodal
Non-Exclusive Leases" and, together with the Intermodal Exclusive Leases,
the "Intermodal Leases"), to the extent that such rights are assignable;
(f) the exclusive Lease-In Transactions set forth on
Exhibit E (the "Scheduled Exclusive Lease-In Transactions") and the
non-exclusive Lease-In Transactions set forth on Exhibit F to the extent
relating to Intermodal Assets (the "Scheduled Non-Exclusive Lease-In
Transactions" and together with the Exclusive Scheduled Lease-In
Transactions, the "Scheduled Lease-In Transactions") to the extent consents
to assignment, as necessary, have been obtained;
(g) all revenues from Intermodal Leases attributable to
the rental of Intermodal Assets with respect to any period commencing upon
any date following the Closing Date;
(h) all manufacturer's warranties and indemnities to the
extent primarily related to the Intermodal Assets and all claims under such
warranties and indemnities, in each case, to the extent assignable and to
the extent related to the Intermodal Assets;
(i) the agreements listed in Section 2.1(i) of the Seller
Disclosure Schedule, to the extent assignable and to the extent they relate
to the Acquired Assets;
(j) any depot, vendor, storage and interchange agreement
to which Seller or a Designated Subsidiary is a party relating exclusively
to the Acquired Assets and which is identified as a contract to be assumed
by Purchaser at Closing in writing delivered by Purchaser to Seller at
least 10 days prior to the Closing to the extent assignable;
(k) Permits to the extent assignable;
(l) books and records relating to the Acquired Assets,
including the maintenance history for all Intermodal Assets (in electronic
form to the extent available), electronic images of licenses and
registration documents currently stored in watermark to the extent
available, and all related databases; and
(m) all claims against third parties, including, without
limitation, those reflected by accounts receivable, relating to damaged
Intermodal Trailers that had not been repaired by the Closing Date and all
amounts paid to Seller in respect thereof, whether before or after the
Closing.
SECTION 2.2 EXCLUDED ASSETS. The term "Acquired Assets"
shall not include any rights, property or assets of Seller or the
Designated Subsidiaries or any of their respective Affiliates of any kind
or nature, real or personal, tangible or intangible, not expressly included
within the definition of "Acquired Assets", and shall not include the
following (any and all of such items, the "Excluded Assets"):
(a) Destroyed Equipment and Sold Equipment;
(b) the Interpool Trademarks and the Interpool Prefixes,
except to the extent of the license granted pursuant to Section 5.7 hereof;
(c) all revenues and other payments received by Purchaser
from a lessee or user of Missing Equipment, regardless of when such
revenues or other payments are received by Purchaser, unless and until such
time as such Missing Equipment becomes Discovered Equipment and Purchaser
pays Seller the amount provided for in Section 2.7(g) hereof;
(d) any reimbursement or payment in any form that
Purchaser receives for maintenance and repair performed on an Acquired
Asset prior to the Closing;
(e) the Excess New Equipment;
(f) all revenues from Intermodal Leases attributable to
the rental of Intermodal Assets during periods ending upon any date prior
to or including the Closing Date (including payments made by railroads in
connection with railroad self-reporting claims for per diem equipment use);
(g) any security deposits of customers in accordance with
the Intermodal Exclusive Leases and the Intermodal Non-Exclusive Leases, to
the extent reflected on the Closing Date Schedule of Security Deposits
(h) the Transamerica Names, the Transamerica Trademarks
and the Transamerica Prefixes, except to the extent of the sublicense
contemplated by Section 5.7(c); and
(i) any Financing Leases (as such term is defined in
Section 5.16), TRAC Leases and installment loans, and equipment subject
thereto.
SECTION 2.3 ASSUMPTION OF LIABILITIES. At the Closing,
Purchaser shall assume and become liable for, and shall pay, perform and
discharge as and when due all of the debts, liabilities, claims, demands,
expenses, commitments and obligations (whether accrued or not, known or
unknown, disclosed or undisclosed, fixed or contingent, asserted or
unasserted, liquidated or unliquidated) (collectively, "Liabilities") of
Seller and the Designated Subsidiaries which are set forth below in this
Section 2.3 (any and all of such items, but other than the Excluded
Liabilities, the "Assumed Liabilities"):
(a) all Liabilities arising after the Closing Date under
the Interpool Exclusive Leases and all Liabilities under the leases
relating to the Transamerica Containers and Transamerica Trailers
(collectively the "Transamerica Leases") arising prior to the Transamerica
Closing Date or following the Closing Date (including, without limitation,
the obligation to refund security deposits to customers in accordance with
the terms thereof);
(b) all Liabilities after the Closing Date under the
Interpool Non- Exclusive Leases relating to the Intermodal Assets
(including, without limitation, the obligation to refund security deposits
to customers in accordance with the terms thereof);
(c) all Liabilities under the Scheduled Lease-In
Transactions (including, without limitation, the Purchaser's assumption
and, if obtained, novation of the Indebtedness) acquired pursuant to
Section 2.1(f);
(d) all Liabilities arising in the ordinary course of
business prior to or after the Closing with respect to any condition of or
return or warranty relating to the Intermodal Assets;
(e) all Liabilities for death, personal injury, other
injury to persons, property damage, or other loss or damage, to the extent
relating to, resulting from, caused by or arising out of, the Acquired
Assets, including the use thereof, whether such Liabilities are based on
tort, negligence, strict liability, failure to warn, design or
manufacturing defect, conspiracy, breach of express or implied warranties
of merchantability or fitness for any purpose or use, employment, workers'
compensation, occupational health and safety or occupational injury laws
but in any such case only to the extent such Liabilities relate to events
occurring after the Closing and excluding any Liabilities under
Environmental Laws (which are covered under clause (g) below);
(f) the obligation to refund security deposits to
customers in accordance with the Intermodal Exclusive Leases and the
Intermodal Non-Exclusive Leases, to the extent reflected on the Closing
Date Schedule of Security Deposits; and
(g) except to the extent of Hazardous Materials or
violations of Environmental Laws present or existing as of the Closing
Date, all Liabilities under Environmental Laws relating to, resulting from,
caused by or arising from the use of the Acquired Assets from and after the
Closing.
SECTION 2.4 EXCLUDED LIABILITIES. Purchaser shall not assume
any Liabilities of the Seller or the Designated Subsidiaries or any of
their respective Affiliates except as provided in Section 2.3, and the
Seller and the Designated Subsidiaries shall be solely and exclusively
liable with respect to all Liabilities of the Seller and the Designated
Subsidiaries other than the Assumed Liabilities (any and all such
Liabilities being herein referred to as "Excluded Liabilities"), including
the following:
(a) all Liabilities to the extent relating to the
Excluded Assets;
(b) all Liabilities to refund overpayments made by any
lessee of Intermodal Assets during any period ending prior to or on the
Closing Date if such customer did, in fact, pay rent for Intermodal Assets
not actually rented during such period (including overpayments by railroads
which arise in connection with railroad self-reporting claims for per diem
equipment use);
(c) all Liabilities relating to the Acquired Assets
under, relating to or arising out of (i) Environmental Laws, including any
actual violation or breach thereof prior to the Closing, or (ii) Third
Party Environmental Claims, other than, in each such case, such Liabilities
relating to or arising out of the ownership, operation, use or disposition
of the Acquired Assets following the Closing;
(d) all Liabilities for death, personal injury, other
injury to persons, property damage, or other loss or damage including
Liability for cleanup due to Hazardous Materials released as of the Closing
Date, to the extent relating to, resulting from, caused by or arising out
of, the Acquired Assets, including the use of or exposure thereto, whether
such Liabilities are based on tort, negligence, strict liability, failure
to warn, design or manufacturing defect, conspiracy, breach of express or
implied warranties of merchantability or fitness for any purpose or use,
employment, occupational disease, toxic tort, workers' compensation,
occupational health and safety or occupational injury laws or Environmental
Law, but in any such case only to the extent such Liabilities relate to
events occurring prior to the Closing or the presence of Hazardous
Materials in a manner that, in its state at or prior to the Closing, would
require a Cleanup under Environmental Law;
(e) the pending litigation set forth on Section 2.4(e) of
the Seller Disclosure Schedule and any other litigation relating to the
Acquired Assets which is pending against Seller or any of its Subsidiaries
at the Closing;
(f) all Liabilities of Seller relating to the current or
former employees of Seller relating to or arising out of any period prior
to the Closing, except for Liabilities Purchaser has agreed to assume
pursuant to Article VI;
(g) except as provided in Section 11.2(c), all
Liabilities for any Taxes of Seller and all Liabilities for Taxes that
relate to the Acquired Assets or Assumed Liabilities for periods (or
portions thereof) up to and including the Closing Date provided, however,
that tangible personal property Taxes with respect to the Acquired Assets
or Assumed Liabilities whose lien date is on or before the Closing Date
shall be treated as allocated entirely to periods before the Closing Date;
(h) except for the Assumed Liabilities, all Liabilities
in respect of the Acquired Assets relating to periods prior to Closing; and
(i) all costs incurred by Seller or third parties for
performing maintenance and repair on an Acquired Asset prior to the Closing
Date, regardless of the invoice date of such repair.
SECTION 2.5 PURCHASE PRICE.
(a) Subject to the terms and conditions of this
Agreement, in consideration of the aforesaid sale, transfer, assignment,
conveyance and delivery of the Acquired Assets to Purchaser, Purchaser
shall (i) assume the Assumed Liabilities (including, without limitation,
the assumption and novation of the Indebtedness) and (ii) pay to Seller at
Closing by wire transfer in immediately available funds to such account or
accounts as Seller shall designate in writing to Purchaser not less than
three Business Days prior to the Closing an amount (the "Purchase Price")
equal to (A) the sum of (1) two hundred eighty-eight million seven hundred
and ten thousand dollars ($288,710,000), (2) the Indebtedness Shortfall
Amount, if any, (3) the Closing Day Amount, (4) the Net Assets Adjustment
Amount minus (B) the sum of the (1) the Maintenance Shortfall Amount, and
(2) the aggregate amount of security deposits shown on the Closing Date
Schedule of Security Deposits. The Purchase Price shall be subject to
post-Closing adjustment as provided in Section 2.7(f) hereof.
(b) For purposes of this Agreement, the term "Closing Day
Amount" means: (i) if the Closing occurs before March 31, 2001, the product
obtained by multiplying (A) $92,000.00 by (B) the number of calendar days
from and including the Closing Date through to and including March 30,
2001; and (ii) if the Closing occurs after March 31, 2001, the product
obtained by multiplying (A) $92,000.00 by (B) negative one (-1) by (C) the
number of calendar days from and including April 1, 2001 through and
including the Closing Date.
(c) For purposes of this Agreement, the term
"Indebtedness Shortfall Amount" shall be an amount equal to the difference
determined by subtracting (i) the aggregate amount of Indebtedness under
the Scheduled Lease-In Transactions as of the Closing from (ii) fifty-six
million nine hundred thousand dollars ($56,900,000). Additionally, the
parties hereto agree that for purposes of determining the Indebtedness
Shortfall Amount, the aggregate amount of Indebtedness under the Scheduled
Lease-In Transactions prior to April 1, 2001 shall not be less than
fifty-six million nine hundred thousand dollars ($56,900,000).
(d) From January 1, 2001 through the Closing Date, if the
amount of maintenance expenses incurred by Seller and its Subsidiaries
(such pro-rata portion is hereinafter referred to as the "Actual
Maintenance Expense") with respect to the Transamerica Assets is less than
the pro-rata portion of eighteen million dollars ($18,000,000) based on a
365 day year (the "Required Maintenance Expense"), then the Purchase Price
shall be adjusted by subtracting the difference between the Required
Maintenance Expense and the Actual Maintenance Expense from the Purchase
Price (such adjustment being referred to herein as the "Maintenance
Shortfall Amount"). The calculation described in this Section 2.5(d) shall
be done at least two Business Days prior to the Closing Date.
(e) Section 2.5(e) of the Seller Disclosure Schedule
identifies by category as of the date of this Agreement the Leased-In
Equipment and the Managed Equipment. At least ten Business Days prior to
the Closing Date, Seller shall prepare and deliver to Purchaser the Closing
Date Schedule of Acquired Assets. For purposes of this Agreement, the term
"Net Assets Adjustment Amount" means an amount equal to difference
determined by subtracting (i) the sum of the Assigned Equipment Values for
all Destroyed Equipment, all Sold Equipment exceeding $300,000, all
Leased-In Equipment listed on Exhibit A but which are not subject to a
Leased-In Transaction as of the Closing Date and all Managed Equipment
listed on Exhibit A but which are not subject to a Management Agreement as
of the Closing Date other than as a result of the termination of such
Management Agreement in accordance with its terms from (ii) the sum of the
Assigned Equipment Values for all New Purchased Equipment (provided that
the purchase price of New Purchased Equipment in excess of $500,000 shall
not be considered in calculating the Net Assets Adjustment Amount unless
such equipment is subject to a lease with a customer in the ordinary course
of Seller's business (such excess of New Purchased Equipment which is not
subject to a lease is herein referred to as the "Excess New Equipment")),
all Leased-In Equipment not listed on Exhibit C but which are subject to a
Lease-In Transaction as of the Closing Date, all Managed Equipment not
listed on Exhibit C but which are subject to a Management Agreement as of
the Closing Date. For a period of 18 months following the Closing and at
such time as Seller enters into a lease with a customer on customary terms
and providing for a minimum lease term of five years (or subject to the
Equipment Use Agreement between Pamco and Pacer), Purchaser shall be
obligated to promptly purchase, and Seller shall be obligated to sell, such
Excess New Equipment for its Assigned Equipment Value by category,
type and age.
SECTION 2.6 CLOSING.
(a) Unless this Agreement shall have been terminated
pursuant to Article VIII, subject to the provisions of Article VII, the
closing (the "Closing") of the purchase of the Acquired Assets and the
assumption of the Assumed Liabilities provided for in this Article II shall
take place at the offices of Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP, Four
Times Square, New York, New York, at 10:00 a.m., New York City time, on or
prior to the later of (i) March 31, 2001 and (ii) the last Business Day of
the month in which all of the conditions set forth in Article VII have been
satisfied or waived, or at such other place and time and on such other date
as the parties may mutually agree in writing. The date on which the Closing
occurs is herein called the "Closing Date".
(b) At the Closing, the sale, transfer, assignment,
conveyance and delivery of the Acquired Assets and the assumption of the
Assumed Liabilities shall be effected pursuant to an assignment and
assumption agreement in customary form (the "Assignment and Assumption
Agreement") and such other documents and instruments as are required by
Article VII hereof and as may be necessary in order to effect the sale of
the Acquired Assets to Purchaser and the assumption of the Assumed
Liabilities by Purchaser.
SECTION 2.7 POST CLOSING PURCHASE PRICE ADJUSTMENT.
(a) During the period commencing on the Closing Date and
ending 180 days after the Closing Date (the "Verification Period"),
Purchaser shall use commercially reasonable efforts to verify the existence
of the intermodal trailers and domestic containers listed on the Closing
Date Schedule of Acquired Assets through the methodologies described on
Exhibit H hereto (the "Stipulated Methodologies").
(b) For purposes of this Agreement, (i) intermodal
trailers and domestic containers that appear on the Closing Date Schedule
of Acquired Assets whose existence is not confirmed by Purchaser within the
Verification Period after Purchaser has used commercially reasonable
efforts to do so in accordance with Section 2.7(a) and which are identified
with reasonable specificity on the Missing and Additional Equipment Report
are referred to herein as "Missing Equipment" and (ii) intermodal trailers
and domestic containers not on the Closing Date Schedule of Acquired Assets
but identified as owned, leased, managed or otherwise under the control of
Purchaser and whose existence is confirmed within the Verification Period
via any one or more of the Stipulated Methodologies or any other
methodology reasonably acceptable to Purchaser are referred to herein as
"Additional Equipment".
(c) As soon as practicable following the end of the
Verification Period (but in no event later than ten Business Days following
the end of the Verification Period), Purchaser shall in good faith deliver
a report (the "Missing and Additional Equipment Report") to Seller
scheduling in reasonable detail the Missing Equipment and the Additional
Equipment and the respective aggregate values thereof. For purposes of this
Agreement, the term "Missing and Additional Equipment Amount" means an
amount equal to the difference determined by subtracting (i) an amount
equal to the sum of the Assigned Equipment Values (or book value as of
September 30, 2000 with respect to the approximately 150 missing units
under the Transamerica Agreement, such approximate number disclosed in
Section 2.7(c) of the Seller Disclosure Schedule) for all Missing Equipment
and in the case of Missing Equipment which is Managed Equipment and
Leased-In Equipment, the sum of the applicable stipulated loss value
payable by Purchaser as assignee with respect to such Managed Equipment and
Leased-In Equipment (as determined pursuant to the applicable Lease-In
Agreement or Management Agreement) from (ii) an amount equal to the sum of
the Assigned Equipment Values by category, type and age for all Additional
Equipment.
(d) Each of Seller and Purchaser shall cooperate and
comply with all reasonable requests of the other party in connection with
the preparation and review of the Missing and Additional Equipment Report.
Without limiting the foregoing, (i) each of Purchaser and Seller shall have
full access during normal business hours to all relevant books and records
reasonably requested by either of them in connection with the preparation
and review of the Missing and Additional Equipment Report (including,
without limitation, books and records regarding the receipt of rent or
lease payments and inspection reports of third parties) and (ii) each party
shall make available to the other party and its representatives such
personnel as such other party may reasonably request in connection with the
preparation and review of the Missing and Additional Equipment Report.
(e) Seller shall have the opportunity during the 90-day
period following its receipt of the Missing and Additional Equipment Report
from Purchaser (the "Seller Review Period") to (i) establish the existence
of any alleged Missing Equipment or Additional Equipment through one or
more of the Stipulated Methodologies or any other reasonable methodology or
(ii) notify Purchaser in writing of Seller's election to dispute the
designation of any equipment as Missing Equipment or failure to designate
any equipment as Additional Equipment and the corresponding disputed
Missing and Additional Equipment Amount (the "Disputed Amount"). The
failure of Seller to notify Purchaser in writing within the Seller Review
Period of Seller's election to dispute Purchaser's designation of equipment
as Missing Equipment or non-designation of equipment as Additional
Equipment shall be deemed Seller's acknowledgment that such equipment is
Missing Equipment or that such equipment is not Additional Equipment, as
the case may be. Any alleged Missing Equipment or Additional Equipment that
is established to exist by any of the Stipulated Methodologies or any other
reasonable methodology during the Seller Review Period shall cease to be
Missing Equipment or shall be deemed Additional Equipment, as the case may
be, and the Missing and Additional Equipment Report shall be updated
accordingly. If Seller shall notify Purchaser of a Disputed Amount during
the Seller Review Period, the parties shall, during the 15 Business Days
following delivery of the notice that sets forth the Disputed Amount (the
date of delivery of such notice, the "Unresolved Dispute Notice Date"),
negotiate in good faith and use reasonable efforts to reach agreement on
the disputed items. If, during such period, the parties are unable to reach
such agreement, then they shall promptly pursue binding arbitration by an
independent arbitrator (who shall not have any material relationship with
Purchaser or Seller) reasonably satisfactory to Purchaser and Seller and
shall deliver to Seller and Purchaser, as promptly as practicable, a report
setting forth the resolution of the Disputed Amount. In the event Purchaser
and Seller are unable to select an arbitrator who is mutually satisfactory
within ten Business Days of the Unresolved Dispute Notice Date, then the
American Arbitration Association shall select an arbitrator as promptly as
practicable following the Unresolved Dispute Notice Date. Any such
arbitration shall be final, conclusive and binding upon the parties hereto.
The cost of such arbitration shall be borne equally by Purchaser and Seller
unless the arbitrator shall decide entirely in favor of one party, in which
case the cost of such arbitration shall be borne by the non-prevailing
party.
(f) Within five Business Days of the resolution of all
disputes relating to the Missing and Additional Equipment Report pursuant
to this Section 2.7: (i) if the Missing and Additional Equipment Amount as
reflected on the Missing and Additional Equipment Report is greater than
zero, then the Purchase Price shall be increased by the amount of such
excess (the amount of such Purchase Price increase shall be hereinafter
referred to as the "Additional Payment Amount"), (ii) if the Missing and
Additional Equipment Amount as reflected on the Missing and Additional
Equipment Report is less than zero, then the Purchase Price shall be
decreased by the absolute value of such negative Missing and Additional
Equipment Amount (the amount of such Purchase Price reduction shall be
hereinafter referred to as the "Refund Amount") or (iii) if the Missing and
Additional Equipment Amount as reflected on the Missing and Additional
Equipment Report equals zero, then the Purchase Price shall not be adjusted
pursuant to this Section 2.7. Any payment of an Additional Payment Amount
or Refund Amount, as the case may be, shall be made within three Business
Days after the date the Missing and Additional Equipment Report becomes
final and binding on the parties hereto, together with interest accruing
from the Closing Date to the date immediately prior to the date of such
payment, at an annual rate equal to LIBOR plus 2%, by wire transfer of
immediately available funds to such account or accounts as Seller (in the
case of an Additional Payment Amount) or Purchaser (in the case of a Refund
Amount) shall designate.
(g) If any equipment that is conclusively determined to
be Missing Equipment is later found or discovered by either party within
one year following the Closing (the "Discovered Equipment"), (i) Purchaser
shall be entitled to maintain full title and all rights to any and all such
Discovered Equipment, and (ii) Seller shall be entitled to receive the
Assigned Equipment Value in respect of such Discovered Equipment.
(h) On or prior to April 12, 2001 (or such later date
that the parties mutually agree), Seller shall deliver written notice to
Purchaser advising it as to each Intermodal Trailer for which Seller does
not have an original good title or duplicate title. Purchaser shall, at its
option, have the right upon written notice to Seller delivered by April 17,
2001 (or such later date that the parties mutually agree) to cause Seller
to sell, transfer and convey to Transamerica any such affected Intermodal
Trailer for the amount set forth in Section 6.24 of the Transamerica
Agreement (the "Repurchase Amount"). The Purchase Price shall be reduced by
the sum of all such Repurchase Amounts and such affected Intermodal Assets
shall not be Acquired Assets. With sixty (60) days following the Closing
Date, Seller shall apply for a duplicate title at Seller's expense for each
Intermodal Trailer for which Seller has not delivered an original good
title or previously made such an application.
(i) Within 180 days following the Closing Date, Purchaser
shall deliver to Seller a detailed written notice identifying each amount
that Seller has invoiced or otherwise claimed a right to payment for with
respect to damage to an Intermodal Trailer for which a customer is
responsible, which damage was not repaired on or before the Closing Date,
as evidenced by a work order reflecting the date of repair (the "Rebill
Claim Report").
Seller shall have the opportunity during the
90-day period following its receipt of the Rebill Claim Report from
Purchaser (the "IPX Review Period") to dispute any amount set forth therein
(the "Rebill Disputed Amount"). The failure of Seller to notify Purchaser
in writing within the IPX Review Period of Seller's objection to any amount
included in the Rebill Claim Report shall be deemed Seller's acknowledgment
that such amount is accurate. If Seller shall notify Purchaser of a Rebill
Disputed Amount during the IPX Review Period, the parties shall, during the
15 Business Days following delivery of the notice that sets forth the
Rebill Disputed Amount (the date of delivery of such notice, the "Rebill
Unresolved Dispute Notice Date"), negotiate in good faith and use
reasonable efforts to reach agreement on the disputed items. If, during
such period, the parties are unable to reach such agreement, then they
shall promptly pursue binding arbitration by an independent arbitrator (who
shall not have any material relationship with Purchaser or Seller)
reasonably satisfactory to Purchaser and Seller and shall deliver to Seller
and Purchaser, as promptly as practicable, a report setting forth the
resolution of the Rebill Disputed Amount. In the event Purchaser and Seller
are unable to select an arbitrator who is mutually satisfactory within ten
Business Days of the Rebill Unresolved Dispute Notice Date, then the
American Arbitration Association shall select an arbitrator as promptly as
practicable following the Rebill Unresolved Dispute Notice Date. Any such
arbitration shall be final, conclusive and binding upon the parties hereto.
The cost of such arbitration shall be borne equally by Purchaser and Seller
unless the arbitrator shall decide entirely in favor of one party, in which
case the cost of such arbitration shall be borne by the non-prevailing
party.
Within five Business Days of the resolution of
all disputes relating to the Rebill Claim Report, the Purchase Price shall
be adjusted by the final amount reflected on the final Rebill Claim Report.
Any payment of an amount to be paid pursuant to this Section shall be made
on such fifth Business Day after the date the Rebill Claim Report becomes
final and binding on the parties hereto, together with interest accruing
from the Closing Date to the date immediately prior to the date of such
payment, at an annual rate equal to LIBOR plus 2%, by wire transfer of
immediately available funds to such account or accounts as Seller (in the
case of payment to Seller) or Purchaser (in the case of a payment to
Purchaser) shall designate. The parties shall make available to each other
all information and data reasonably required to compile and dispute the
Rebill Claim Report.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF SELLER
Except as set forth in the Seller Disclosure Schedule
delivered by Seller to Purchaser prior to the execution of this Agreement
and making reference to the particular section of this Agreement to which
exception is being taken (unless the applicability of such exception is
reasonably apparent to other sections, in which case a reference to such
other sections shall not be necessary), Seller represents and warrants to
Purchaser as of the date hereof as follows:
SECTION 3.1 ORGANIZATION, POWER. Seller and the Designated
Subsidiaries are duly organized, validly existing and in good standing
under the laws of their respective states of organization. Each of the
Seller and the Designated Subsidiaries has full power and authority to own
all of the Acquired Assets, to carry on its business as it is now being
conducted, and, where applicable, is duly qualified or licensed to do
business as a foreign entity and is in good standing in each jurisdiction
in which the nature of its business or the Acquired Assets makes such
qualification or license necessary, except where failure to be so
incorporated, existing, qualified, licensed or in good standing would not
have a Material Adverse Effect. Seller has heretofore made available to
Purchaser complete and correct copies of the respective certificates of
incorporation, by-laws and other organizational documents, if any,
applicable to Seller and the Designated Subsidiaries.
SECTION 3.2 AUTHORITY RELATIVE TO AGREEMENT. Seller has the
corporate power and authority to execute and deliver this Agreement and the
other agreements, documents and instruments to be executed and delivered in
connection with this Agreement and Seller and the Designated Subsidiaries
have the corporate power and authority to consummate the transactions
contemplated by this Agreement and the other agreements, documents and
instruments to be executed and delivered in connection with this Agreement.
The execution and delivery by Seller of this Agreement and the other
agreements, documents and instruments to be executed and delivered in
connection with this Agreement has been and, the consummation by Seller and
the Designated Subsidiaries of the transactions contemplated by this
Agreement and the other agreements, documents and instruments to be
executed and delivered in connection with this Agreement will be prior to
the Closing, duly authorized by all necessary action and no other
proceedings on the part of Seller or the Designated Subsidiaries are
necessary for Seller and the Designated Subsidiaries to authorize this
Agreement and the other agreements, documents and instruments to be
executed and delivered in connection with this Agreement or to consummate
the transactions contemplated by this Agreement and the other agreements,
documents and instruments to be executed and delivered in connection with
this Agreement. Assuming that this Agreement has been duly executed and
delivered by Purchaser, this Agreement constitutes a valid and legally
binding agreement of Seller enforceable against Seller in accordance with
its terms, except as affected by bankruptcy, insolvency, fraudulent
conveyance, reorganization, moratorium and other similar laws relating to
or affecting creditors' rights generally or general equitable principles
(whether considered in a proceeding at equity or in law).
SECTION 3.3 NON-CONTRAVENTION. The execution and delivery of
this Agreement and the other agreements, documents and instruments to be
executed and delivered in connection with this Agreement by Seller do not,
and the consummation by Seller and the Designated Subsidiaries of the
transactions contemplated by this Agreement and the other agreements,
documents and instruments to be executed and delivered in connection with
this Agreement and the performance by Seller and the Designated
Subsidiaries of the obligations which it is obligated to perform hereunder
and thereunder will not, (a) violate any provision of the certificate of
incorporation or by-laws (or comparable organizational documents) of Seller
or the Designated Subsidiaries or (b) assuming that all consents,
authorizations, orders or approvals of, filings or registrations with, and
notices to, each United States federal, state, local and foreign
governmental entity, commission, board or other regulatory authority,
agency, body or entity ("Governmental Authority") listed in Section 3.4(a)
of the Seller Disclosure Schedule and all Third Party Consents listed in
Section 3.4(b) of the Seller Disclosure Schedule have been obtained or
made, (i) violate any law, regulation, rule, order, judgment or decree to
which the Acquired Assets or Seller or any of the Designated Subsidiaries
is subject (collectively, other than Environmental Laws, "Applicable Law")
or Environmental Laws or (ii) violate, result in the termination or the
acceleration of, or conflict with or constitute a default (with or without
notice thereof of lapse of time) under, or result in the creation or
imposition of any Encumbrances, other than Permitted Encumbrances, upon any
of the Acquired Assets pursuant to any agreement, contract, mortgage,
indenture, lease, franchise, Permit or other instrument (each, a
"Contract"), to which Seller or any of the Designated Subsidiaries is a
party or by which any of the Acquired Assets is bound, except, in the case
of clauses (b)(i) and (ii), relating to the Transamerica Assets as of the
Transamerica Closing Date for such violations, terminations, accelerations,
conflicts, defaults, Encumbrances (other than Permitted Encumbrances), or
losses of licenses or other contractual rights as would not have a Material
Adverse Effect.
SECTION 3.4 CONSENTS. (a) Except as described in Section
3.4(a) of the Seller Disclosure Schedule, no consent, authorization, order
or approval of, filing or registration with, or notice to, any Governmental
Authority and (b) except as described in Section 3.4(b) of the Seller
Disclosure Schedule, no consent, authorization, order or approval of,
filing or registration with, or notice to, any party to any Material
Contract (the consents, authorizations, orders, approvals, filings,
registrations and notices described in this clause (b), collectively,
"Third Party Consents") to which Seller or any of the Designated
Subsidiaries is a party or by which any of the Acquired Assets is bound is
required for the execution and delivery of this Agreement and the other
agreements, documents and instruments to be executed and delivered in
connection with this Agreement by Seller and the consummation by Seller and
the Designated Subsidiaries of the transactions contemplated hereby, except
for such consents, authorizations, orders, approvals, filings,
registrations, notices or Third Party Consents (i) which are required
solely by reason of the specific regulatory status of Purchaser or any
Affiliate thereof or (ii) with respect to the Transamerica Assets, the
failure of which to be obtained or made would not result in a Material
Adverse Effect or prohibit the consummation by Seller and the Designated
Subsidiaries of the transactions contemplated by this Agreement and the
other agreements, documents and instruments to be executed and delivered in
connection with this Agreement. Notwithstanding the foregoing, Seller makes
no representations or warranties as to Seller's right to assign, without
the consent of Pacer, any agreement with Pacer or PAMCO or the agreements
referred to in Section 5.15(b) hereof.
SECTION 3.5 LITIGATION. Except as set forth in Section 3.5
of the Seller Disclosure Schedule or relating to third party personal
injury and property damage claims relating to the Interpool Assets or
relating to the Transamerica Assets with respect to occurrences after the
Transamerica Closing, there is no action, suit, audit, investigation or
other proceeding pending or, to the Knowledge of Seller, threatened against
Seller or any of the Designated Subsidiaries relating to or arising out of
the Interpool Assets before any court, arbitrator or Governmental
Authority. Except as set forth in Section 3.5 of the Seller Disclosure
Schedule or relating to third party personal injury and property damage
claims relating to the Transamerica Assets with respect to occurrences
prior to the Transamerica Closing, there is no action, suit, audit,
investigation or other proceeding pending or, to the Knowledge of Seller,
threatened against Seller or any of the Designated Subsidiaries primarily
relating to or arising out of the Transamerica Assets before any court,
arbitrator or Governmental Authority, that would have a Material Adverse
Effect. Except as set forth in Section 3.5 of the Seller Disclosure
Schedule, there is no action, suit, audit, investigation or other
proceeding pending or, to the Knowledge of Seller, threatened against
Seller or any of the Designated Subsidiaries relating to or arising out of
the Acquired Assets before any court, arbitrator or Governmental Authority
that would in the case of the Transamerica Assets as of the Transamerica
Closing Date have a Material Adverse Effect. None of Seller or any of the
Designated Subsidiaries is, in any material respect, in violation of any
orders, judgments, injunctions or decrees applicable to the Acquired
Assets. There are no outstanding orders, writs, judgments, injunctions,
decrees or settlements of or with any Governmental Authority which have
been sent to or served upon Seller, that apply, in whole or in part, to the
Acquired Assets that restrict the ownership, disposition or use of the
Acquired Assets.
SECTION 3.6 COMPLIANCE WITH LAWS; PERMITS AND LICENSES.
(a) Except as set forth in Section 3.6 of the Seller
Disclosure Schedule, the Acquired Assets have been during the past three
years (or, with respect to any particular Acquired Asset, such shorter
period of time as Seller or the Designated Subsidiaries have owned or
operated such Acquired Asset) and is being used in all material respects in
compliance with all Applicable Laws. Except as set forth in Section 3.6 of
the Seller Disclosure Schedule, Seller has not received any written notice
in the past three years (or, with respect to any particular Acquired Asset,
such shorter period of time as Seller or the Designated Subsidiaries have
owned or operated such Acquired Asset) with respect to the material failure
of the Acquired Assets to be used in compliance with all Applicable Laws.
(b) Seller or a Designated Subsidiary holds all material
Permits necessary for the operation of the Acquired Assets as presently
conducted. All such material Permits are in full force and effect and no
proceedings are pending or, to the Knowledge of Seller, threatened by a
Governmental Authority for the suspension, revocation or termination of any
such material Permits.
SECTION 3.7 WARRANTY CLAIMS. Except as set forth in Section
3.7 of the Seller Disclosure Schedule, since January 1, 1998 (or, with
respect to any particular Intermodal Asset, such shorter period of time as
Seller or the Designated Subsidiaries have owned or operated such
Intermodal Asset) and as of the date hereof, no customer of Seller has in
writing asserted or requested that Seller assert a warranty claim with
respect to any equipment constituting part of the Intermodal Assets against
the manufacturer of such equipment and to the Knowledge of Seller, there is
not now existing any basis for any such warranty claim. Except as set forth
in Section 3.7 of the Seller Disclosure Schedule, Seller is not presently
asserting any warranty claim, nor has Seller commenced any legal action,
against the manufacturer of any Intermodal Asset or alleged any cause of
action based on such manufacturer's breach of warranty, express or implied.
SECTION 3.8 EMPLOYEES; EMPLOYEE BENEFITS. (a) Section 3.8(a)
of the Seller Disclosure Schedule contains a true and complete list of each
severance or termination pay, medical, surgical, hospitalization, life
insurance and other "welfare" plan or program (within the meaning of
section 3(1) of ERISA); each profit-sharing, stock bonus or other "pension"
plan or program (within the meaning of section 3(2) of ERISA); each
deferred compensation, incentive compensation, annual bonus, stock
purchase, stock option and other equity compensation plan or program; each
individual employment, termination or severance agreement; and each other
"employee benefit plan" (within the meaning of section 3(3) of ERISA) in
each case, that is sponsored, maintained or contributed to by Seller for
the benefit of any Business Employee (the "Benefit Plans").
(b) All contributions required to be made with respect to
any Benefit Plan prior to the Closing Date have been timely made, and each
Benefit Plan has been operated and administered in all material respects in
accordance with Applicable Law, including but not limited to ERISA and the
Code.
(c) No liability under Subtitle C or D of Title IV of
ERISA has been or is reasonably expected to be incurred by the Seller or
any of its Subsidiaries with respect to any ongoing, frozen or terminated
"single-employer plan," within the meaning of Section 4001(a)(15) of ERISA,
currently or formerly maintained by any of them, or the single-employer
plan of an entity which is considered one employer with the Seller under
Section 4001 of ERISA or Section 414 of the Code (an "ERISA Affiliate"),
for which Purchaser could reasonably be expected to have any Liability
following the Closing Date. Neither the Seller, any of its Subsidiaries nor
an ERISA Affiliate has contributed to a "multiemployer plan", within the
meaning of Section 3(37) of ERISA, at any time in the six years prior to
the date hereof.
(d) There are no pending, or, to the Knowledge of Seller,
threatened or anticipated claims against any or with respect to any Benefit
Plan brought by any Business Employee or his or her beneficiary covered
under any such Benefit Plan (other than routine claims for benefits) that
would be an Assumed Liability.
(e) The consummation of the transactions contemplated by
this Agreement will not either alone or in combination with another event,
(i) entitle any Business Employee to severance pay that would be an Assumed
Liability or (ii) accelerate the time of payment or vesting, or increase
the amount of compensation due any such Business Employee that would be an
Assumed Liability.
(f) No labor organization or group of Business Employees
has made a pending demand for recognition or certification, and to the
Knowledge of Seller there are no representation or certification
proceedings or petitions seeking a representation proceeding presently
pending or threatened in writing to be brought or filed with the National
Labor Relations Board or any other labor relations tribunal or authority.
SECTION 3.9 TAXES.
(a) All Tax Returns to be filed by or with respect to
Seller have been duly and timely filed except for those Tax Returns the
failure of which to file would be material, and all such Tax Returns are
true and complete in all material respects. All Tax Returns required to be
filed with respect to the Acquired Assets have been filed with the
appropriate Taxing Authority, and all such Tax Returns are true and correct
in all material respects. All Taxes due and payable or claimed or asserted
by any Taxing Authority to be due, from or with respect to the Acquired
Assets have been paid or Seller has provided for all such Taxes on it books
and records;
(b) All Taxes payable with respect to the Acquired Assets
have been paid, the non-payment of which would result in a lien on the
Acquired Assets or would result in Purchaser becoming liable or responsible
therefor;
(c) No audit or other administrative proceedings or court
proceeding are presently pending or proposed with regard to Taxes with
respect to the Acquired Assets;
(d) There are no liens (other than Permitted
Encumbrances) with respect to Taxes upon any of the Acquired Assets.
SECTION 3.10 MATERIAL CONTRACTS. (a) Section 3.10 of the
Seller Disclosure Schedule sets forth, as of the date hereof, the following
(other than Excluded Assets and Excluded Liabilities):
(i) each agreement which constitutes a part of
the Transamerica Assets and which by its terms materially and adversely
affects or materially restricts the freedom of Seller to engage in a line
of business or with any Person or in any geographical area or otherwise to
conduct its business as presently conducted and each agreement which
constitutes a part of the Interpool Assets and which by its terms adversely
affects or restricts the freedom of Seller to engage in a line of business
or with any Person or in any geographical area or otherwise to conduct its
business as presently conducted;
(ii)each contract, legally binding arrangement or
agreement or purchase order for the purchase of equipment, materials or
supplies which constitutes a part of the Acquired Assets, except those
contracts or agreements terminable without penalty on 30 or fewer days'
notice or those involving the receipt or payment of less than $100,000 per
year;
(iii)each contract or agreement with any employee
(or group of employees) which is assumed by Purchaser under this Agreement
which is not terminable without penalty on 30 or fewer days' notice;
(iv)each Lease-In Agreement which constitutes a
part of the Acquired Assets;
(v) each Management Agreement which constitutes a
part of the Acquired Assets;
(vi)each Lease Transaction which constitutes a
part of the Acquired Assets for domestic containers with respects to which
there are more than 250 subject units (for which purpose all schedules
pursuant to each such Lease Transaction shall be aggregated);
(vii)each Lease Transaction which constitutes a
part of the Acquired Assets for intermodal trailers with respect to which
there are more than 250 subject units (for which purpose all schedules
pursuant to each such Lease Transaction shall be aggregated);
(viii) each agreement, contract or commitment
which constitutes a part of the Acquired Assets pursuant to which Seller or
a Designated Subsidiary has received, has a right to receive or may
reasonably be expected to receive more than $500,000 in any calendar year;
and
(ix)each agreement, contract or commitment which
constitutes a part of the Acquired Assets pursuant to which Seller or a
Designated Subsidiary has paid, has an obligation to pay or may reasonably
be expected to pay more than $250,000 in any calendar year or to provide
services worth more than $250,000 in any calendar year, in each case
including any written or oral modification, amendment, supplement, side
letter or incidental agreement.
(b) The agreements described in Section 3.10(a) and other
agreements meeting the criteria specified therein, whether entered into
before the date hereof or between the date hereof and the Closing, are
referred to as the "Material Contracts."
(c) Except as set forth in Section 3.10(c) of the Seller
Disclosure Schedule, as of the date hereof, each Material Contract has been
executed by the other party thereto and is in full force and effect, and
constitutes the legal, valid and binding obligation of Seller or the
Designated Subsidiaries, as the case may be, as a party thereto, in
accordance with the terms of such agreement.
(d) A true, correct and complete copy of each Material
Contract in existence as of the date hereof, including each such Material
Contract that constitutes a Lease Transaction (collectively, the "Equipment
Leases"), has been made available to Purchaser. Except as set forth in
Section 3.10(d) of the Seller Disclosure Schedule, Seller has not sold,
assigned or otherwise granted to any party (including any lessee under an
Equipment Lease) any present or future right or option to acquire any
ownership interest in any equipment under an Equipment Lease or to retain
any such equipment without paying a reasonable rental therefore after the
expiration of the term of such lease, other than ordinary course hold-over
provisions. To the Knowledge of Seller, there are no oral Material
Contracts or oral modifications to any Material Contracts.
(e) Except as set forth in Section 3.10(e) of the Seller
Disclosure Schedule, (i) to the Knowledge of Seller, each Material Contract
is not subject to any defense, offset, claim, right of rescission or
counterclaim, is legally binding and enforceable by Seller in accordance
with its written terms (assuming the due authorization and delivery of each
such agreement by the other parties thereto), (ii) to the Knowledge of
Seller, no event has occurred which, with notice and/or lapse of time,
would constitute a material default by Seller or any other party under any
Material Contract, (iii) Seller has not received any written notice from or
given any written notice to any other party indicating that it or such
other party, as the case may be, is presently in default under or in breach
or violation of any Material Contract, (iv) to the Knowledge of Seller, no
obligor to Seller under any Material Contract is required under any
applicable law to withhold from payments on any such Material Contract any
interest or other withholdings for the payment of Taxes to any Governmental
Authority, and (v) no Material Contract with a term greater than one year
is terminable at the option of the third party thereunder unless such
termination right is set forth in such Material Contract.
(f) Except as set forth in Section 3.10(f) of the Seller
Disclosure Schedule, no Lease Transaction is subject to any debt
subordination agreement, participation agreement, intercreditor agreement,
owner trust agreement, purchase agreement, collateral sharing agreement,
residual sharing agreement, remarketing agreement or vendor recourse
agreement. Except as set forth in Section 3.10(f) of the Seller Disclosure
Schedule, to Seller's Knowledge, no obligor under any Lease Transaction is
a Governmental Authority.
(g) To the Knowledge of Seller and without making any
representations as to enforceability, the terms of each unsigned Material
Contract are as set forth in such unsigned Material Contract.
(h) Except as set forth in Section 3.10(h) of the Seller
Disclosure Schedule and other than under the Transamerica Transition
Services Agreement, all payments pursuant to Lease Transactions are made
directly to Seller or a Subsidiary of Seller.
SECTION 3.11 TITLE TO ACQUIRED ASSETS; ABSENCE OF
ENCUMBRANCES; ACQUIRED ASSETS. (a) Except as set forth in Section 3.11(a)
of the Seller Disclosure Schedule, Seller has good and valid title to (or,
in the case of the Acquired Assets that are leased by the Seller or the
Designated Subsidiaries, a valid leasehold interest in) the Acquired
Assets, in each case free and clear of all Encumbrances other than
Permitted Encumbrances. At the Closing, Seller and the Designated
Subsidiaries will deliver to the Purchaser, good and valid title to (or, in
the case of Intermodal Assets that are leased by the Seller or the
Designated Subsidiaries, a valid leasehold interest in) the Acquired
Assets, free and clear of all Encumbrances except Permitted Encumbrances.
As of the Closing, there will be no Encumbrances relating to any of the
Acquired Assets other than Permitted Encumbrances and other than arising
from any financing by Purchaser.
(b) Except as set forth in Section 3.11(b) of the Seller
Disclosure Schedule or pursuant to this Agreement, with respect to the
Interpool Assets there does not exist any right, option or agreement
granting any Person the right to purchase or otherwise acquire any of the
Intermodal Assets.
(c) Except as set for the in Section 3.11(c) of the
Seller Disclosure Schedule, the Interpool Assets that are off-hire have
been maintained in good leasable operating condition, in each instance, in
accordance with Seller's written policies which interpret the Rules and
Regulations of the U.S. Federal Highway Act, the Rules and Regulations of
the U.S. Department of Transportation and the TOFC/COFC Interchange Rules
and Trailer and Container Service and Reporting Rules as adopted by the
Association of American Railroads, as applicable, and are suitable and
adequate for their current use. The Intermodal Assets that are on-hire as
of the date hereof are subject to leases which provide for the lessee to
maintain such intermodal trailer or domestic container, as applicable, in
good operating condition, in any instance, in accordance with Seller's
written policies which interpret the Rules and Regulations of the U.S.
Federal Highway Act, the Rules and Regulations of the U.S. Department of
Transportation and the TOFC/COFC Interchange Rules and Trailer and
Container Service and Reporting Rules as adopted by the Association of
American Railroads, as applicable, normal wear and tear excepted.
(d) Except as set forth in Section 3.11(d) of the Seller
Disclosure Schedule, between the Transamerica Closing Date and the date
hereof, there has been (i) no written material modification and (ii) to
Seller's Knowledge, no oral material modification, to the Transamerica
Leases.
SECTION 3.12 ENVIRONMENTAL. (a) Except as set forth in
Section 3.12(a) of the Seller Disclosure Schedule and except as would not
have a Material Adverse Effect with respect to the Transamerica Assets with
respect to occurrences prior to the Transamerica Closing Date, (i) Seller
is in material compliance with all applicable Environmental Laws (as of the
date hereof and as of the Closing Date) with respect to the Intermodal
Assets, which compliance includes the possession by the Seller or its
Subsidiaries of all material permits and other governmental authorizations
required under applicable Environmental Laws to operate the Intermodal
Assets and compliance with the terms and conditions thereof, and (ii)
within the past three years (or, with respect to any particular Intermodal
Asset, such shorter period of time as Seller has owned or operated such
Intermodal Asset), Seller has not received any written communication from a
Governmental Authority or other Person that alleges that the Seller is not
in such compliance or that Seller is a potentially liable party under
Environmental Laws for cleanup.
(b) Except as set forth in Section 3.12(b) of the Seller
Disclosure Schedule, within the past three years (or, with respect to any
particular Intermodal Asset, such shorter period of time as Seller has
owned or operated such Intermodal Asset) no notice, demand, request for
information, citation, claim, action, proceeding, summons or complaint has
been received by any of Seller or any of its Subsidiaries, and no penalty
has been assessed or, to Seller's Knowledge, threatened against Seller or
any of its Subsidiaries by any Governmental Authority with respect to any
alleged failure by Seller or any of its Subsidiaries to have any Permit
required under any Environmental Law in connection with the ownership or
operation of the Intermodal Assets.
(c) Except as set forth in Section 3.12(c) of the Seller
Disclosure Schedule, to Seller's Knowledge, there are no administrative or
judicial judgments, orders or decrees that relate to violations of or
potential liability under Environmental Law with respect to the Intermodal
Assets or the Chicago and Atlanta real properties described in Section
3.12(e) of the Seller Disclosure Schedule.
(d) Except as set forth in Section 3.12(d) of the Seller
Disclosure Schedule and except as would not have a Material Adverse Effect
with respect to the Transamerica Assets as of the Transamerica Closing
Date, to Seller's Knowledge, Seller is not engaged in any activity in
connection with the ownership or operation of the Intermodal Assets that
would violate any Environmental Law.
(e) To the Knowledge of Seller and except as would not
have a Material Adverse Effect with respect to the Transamerica Assets as
of the Transamerica Closing Date, no facts, circumstances or conditions
exist with respect to the Acquired Assets or the Chicago and Atlanta real
properties described in Section 3.12(e) of the Seller Disclosure Schedule
that could reasonably be expected to result in Seller and Designated
Subsidiary not being in compliance with or having to make capital
expenditures to maintain compliance with Environmental Laws or
Environmental Permits or incurring liability for cleanup.
(f) Seller has provided Purchaser with copies of all
environmental, health or safety assessments, audits, studies, inspections,
analyses, results of investigations or other reports that have been
performed in the past three years with respect to the Intermodal Assets or
the Chicago and Atlanta real properties described in Section 3.12(e) of the
Seller Disclosure Schedule, and that are in the possession, custody or
control of Seller.
(g) Notwithstanding anything to the contrary in this
Agreement, the representations and warranties set forth in this Section
3.12 are the sole and exclusive representations and warranties of the
Seller in this Agreement relating to Environmental Laws and other
environmental matters.
SECTION 3.13 INTELLECTUAL PROPERTY. Except as would not have
a Material Adverse Effect with respect to the Transamerica Assets or be
material to the Acquired Assets with respect to the Interpool Assets,
Seller and its Subsidiaries own or have the valid right to use all
Interpool Trademarks and Interpool Prefixes (collectively, the
"Intellectual Property"), free and clear of all Encumbrances (other than
Permitted Encumbrances). The Intellectual Property, in all material
respects: (i) is duly maintained by Seller and its Subsidiaries, (ii) is
valid and subsisting, in full force and effect and (iii) has not expired,
nor been cancelled or abandoned. There are no restrictions or limitations
on the rights of Seller or any of its Subsidiaries to license any of the
Intellectual Property to Purchaser as provided in Section 5.7 hereof.
SECTION 3.14 BROKERS. No broker, investment banker,
financial advisor or other Person is entitled to any broker's, finder's,
financial advisor's or other similar fee or commission in connection with
the transactions contemplated by this Agreement based upon arrangements
made by or on behalf of Seller.
SECTION 3.15 NO REGULATORY IMPEDIMENT. Excluding the
requirements of the HSR Act, Seller is not aware of any fact relating to
its business, operations, financial condition or legal status that might
materially impair its ability to obtain, on a timely basis, all consents,
authorizations, orders, approvals and Permits from, and make all necessary
filings and registrations with and all notices to, Governmental Authorities
necessary for the consummation of the transactions contemplated hereby.
SECTION 3.16 ABSENCE OF CERTAIN CHANGES OR EVENTS. From
December 31, 2000 (or with respect to any particular Acquired Asset, such
shorter period of time as Seller or a Designated Subsidiary has owned or
operated such Acquired Asset), (i) there has not been any change or
development in or affecting the Acquired Assets that has had or will have a
Material Adverse Effect and (ii) the Acquired Assets have been operated in
the ordinary course of business consistent with past practices. Except as
set forth in Section 3.16 of the Seller Disclosure Schedule, from July 1,
2000 (or with respect to any particular Acquired Asset, such shorter period
of time as Seller or the Designated Subsidiary have owned or operated such
Acquired Asset) through to the date of this Agreement, Seller has not (i)
waived or committed to waive any material rights related to the Acquired
Assets, other than in the ordinary course of business, or (ii) directly or
indirectly in any way extended or otherwise restructured the payment
schedule or the payment terms of any Material Contract, or made any
advance, extension, novation, modification or other accommodation to any
lessee or obligor thereunder, other than in each case in the ordinary
course of business.
SECTION 3.17 FINANCIAL AND BUSINESS INFORMATION. The
business information set forth in Section 3.17 of the Seller Disclosure
Schedule and that were previously delivered by Seller to Purchaser are
complete and accurate in all material respects and the financial data set
forth in Section 3.17 of the Seller Disclosure Schedule and that were
previously delivered by Seller to Purchaser fairly presents the information
set forth therein in all material respects.
SECTION 3.18 INSURANCE. Set forth in Section 3.18 of the
Seller Disclosure Schedule is a list of all liability, property, workers
compensation, and other policies of insurance that insure Seller in respect
of the Acquired Assets and liabilities arising in connection therewith.
SECTION 3.19 CONDUCT OF BUSINESS. Seller has conducted the
Acquired Assets only in the ordinary course consistent with past practices
and has not dealt with or entered into any contracts, commitments or
arrangements with respect to the Acquired Assets with its Affiliates on
terms and conditions less favorable to it than would be available in a
comparable transaction with a Person not an Affiliate of Seller. Since July
1, 2000, Seller has not deferred the maintenance of the Intermodal Assets
(or with respect to any particular Acquired Asset, such shorter period of
time as Seller or the Designated Subsidiary have owned or operated such
Acquired Asset) and has continued its ordinary course maintenance
practices.
SECTION 3.20 INDEBTEDNESS. The aggregate amount of
Indebtedness under the Scheduled Lease-In Transactions as of March 31, 2001
will be $56,900,000.
SECTION 3.21 ACCURACY OF TRANSAMERICA REPRESENTATIONS AND
WARRANTIES. Except as set forth in Section 3.21 of the Seller Disclosure
Schedule, to the Knowledge of Seller, the representations and warranties of
Transamerica in the Transamerica Agreement were accurate when made and as
of the Transamerica Closing Date.
SECTION 3.22 NS SUBLEASE. To the Knowledge of Seller, the
Norfolk Southern Railway Company Sublease of the "Master Equip. Lease Agrt
- Chassis" dated January 1, 1995 between Seller and TCS Leasing, Inc. is
still in full force and effect.
SECTION 3.23 TRANSAMERICA AGREEMENT. Seller has furnished
Purchaser with a complete and accurate copy of the Transamerica Agreement,
including exhibits, schedules, attachments and all modifications, waivers
and amendments thereto.
SECTION 3.24 FINANCE LEASE; TRACE LEASE; INSTALLMENT
LOAN. To Seller's Knowledge, no Interpool Asset is subject to a Financing
Lease, TRAC Lease or Installment Loan.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF PURCHASER
Except as expressly set forth in the Purchaser Disclosure
Schedule delivered by Purchaser to Seller prior to the execution of this
Agreement and making reference to the particular section of this Agreement
to which exception is being taken (unless the applicability of such
exception is reasonably apparent to other sections, in which case a
reference to such other sections shall not be necessary), the Purchaser
represents and warrants to Seller as of the date hereof follows:
SECTION 4.1 ORGANIZATION. Purchaser is a corporation duly
incorporated, validly existing and in good standing under the laws of its
jurisdiction of incorporation. Purchaser has heretofore made available to
Seller complete and correct copies of the respective certificates of
incorporation, by-laws and other organizational documents, if any,
applicable to Purchaser.
SECTION 4.2 AUTHORITY RELATIVE TO AGREEMENT. Purchaser has
the corporate power and authority to execute and deliver this Agreement and
the other agreements, documents and instruments to be executed and
delivered in connection with this Agreement and to consummate the
transactions contemplated by this Agreement and the other agreements,
documents and instruments to be executed and delivered in connection with
this Agreement. The execution and delivery by Purchaser of this Agreement
and the other agreements, documents and instruments to be executed and
delivered in connection with this Agreement and the consummation by
Purchaser of the transactions contemplated by this Agreement and the other
agreements, documents and instruments to be executed and delivered in
connection with this Agreement have been duly authorized by all necessary
corporate action and no other corporate proceedings on the part of the
Purchaser are necessary for Purchaser to authorize this Agreement and the
other agreements, documents and instruments to be executed and delivered in
connection with this Agreement or to consummate the transactions
contemplated by this Agreement and the other agreements, documents and
instruments to be executed and delivered in connection with this Agreement.
Assuming that this Agreement has been duly executed and delivered by
Seller, this Agreement constitutes a valid and legally binding agreement of
Purchaser enforceable against Purchaser in accordance with its terms,
except as affected by bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and other similar laws relating to or affecting
creditors rights generally or general equitable principles (whether
considered in a proceeding at equity or in law).
SECTION 4.3 NON-CONTRAVENTION. The execution and delivery of
this Agreement and the other agreements, documents and instruments to be
executed and delivered in connection with this Agreement by Purchaser do
not, and the consummation by Purchaser of the transactions contemplated by
this Agreement and the other agreements, documents and instruments to be
executed and delivered in connection with this Agreement and the
performance by Purchaser of the obligations which it is obligated to
perform hereunder and thereunder will not, (a) violate any provision of the
certificate of incorporation or by-laws or other organizational documents
of Purchaser or (b) assuming that all consents, authorizations, orders or
approvals of, filings or registrations with, and notices to, each
Governmental Authority listed in Section 4.4(a) of the Purchaser Disclosure
Schedule and all Third Party Consents listed in Section 4.4(b) of the
Purchaser Disclosure Schedule have been obtained or made, (i) violate any
Applicable Law or Environmental Laws or (ii) violate, result in the
termination or the acceleration of, or conflict with or constitute a
default under, any Contract to which Purchaser is a party or by which any
of its properties are bound, except, in the case of clauses (b)(i) and
(ii), for such violations, terminations, accelerations, conflicts or
defaults as would not prohibit, materially delay or otherwise materially
impair Purchaser's ability to consummate the transactions contemplated by
this Agreement and the other agreements, documents and instruments to be
executed and delivered in connection with this Agreement.
SECTION 4.4 CONSENTS. (a) Except as described in Section
4.4(a) of the Purchaser Disclosure Schedule, no consent, authorization,
order or approval of, filing or registration with, or notice to, any
Governmental Authority and (b) except as described in Section 4.4(b) of the
Purchaser Disclosure Schedule, no Third Party Consent is required for the
execution and delivery of this Agreement by Purchaser and the consummation
by Purchaser of the transactions contemplated by this Agreement and the
other agreements, documents and instruments to be executed and delivered in
connection with this Agreement, except for such consents, authorizations,
orders, approvals, filings, registrations, notices or Third Party Consents
the failure of which to be obtained or made would not prohibit, materially
delay or otherwise materially impair the consummation by Purchaser of the
transactions contemplated by this Agreement and the other agreements,
documents and instruments to be executed and delivered in connection with
this Agreement.
SECTION 4.5 BROKERS. No broker, investment banker, financial
advisor or other person is entitled to any broker's, finder's, financial
advisor's or other similar fee or commission in connection with the
transactions contemplated hereby based upon arrangements made by or on
behalf of Purchaser.
SECTION 4.6 AVAILABILITY OF FUNDS. Purchaser has, and at the
Closing will have, sufficient funds available to enable it to (i) pay the
Purchase Price (as adjusted in accordance with Article II hereof), (ii)
perform its other obligations hereunder and (iii) pay the amounts required
to be paid pursuant to Section 11.2 hereof. Purchaser's obligations under
this Agreement are not subject to any condition regarding Purchaser's
ability to obtain funding for the consummation of the transactions
contemplated hereby.
SECTION 4.7 NO REGULATORY IMPEDIMENT. Excluding the
requirements of the HSR Act, Purchaser is not aware of any fact relating to
its business, operations, financial condition or legal status that might
materially impair its ability to obtain, on a timely basis, all consents,
authorizations, orders, approvals and Permits from, and make all necessary
filings and registrations with and all notices to, Governmental Authorities
necessary for the consummation of the transactions contemplated hereby.
SECTION 4.8 LITIGATION. Except as set forth in Section 4.8
of the Purchaser Disclosure Schedule, there is no claim, action, suit,
proceeding or, to the knowledge of Purchaser, governmental investigation
pending or threatened against Purchaser or any of its Affiliates by or
before any court or Governmental Authority that, individually or in the
aggregate, would have or would reasonably be expected to impede the ability
of Purchaser to complete the Closing in any respect or materially delay the
Closing.
SECTION 4.9 TRANSAMERICA AGREEMENT. Purchaser has received a
copy of, has read and fully understands the terms of the Transamerica
Agreement (including, without limitation, the disclosure schedules
thereto). Purchaser hereby further acknowledges and agrees that except as
provided for in Section 3.21 hereof, neither Seller nor its Subsidiaries
nor any of its or their respective Representatives (as defined in Article
10 hereto) makes any express or implied representation or warranty or other
statement, and neither Seller nor its Subsidiaries nor any of its or their
respective Representatives shall have any liability or obligation to any
Purchaser Indemnified Party (as defined in Article 10 hereto), under the
Transamerica Agreement, including, without limitation, the validity,
enforceability or interpretation thereof.
ARTICLE V
COVENANTS
SECTION 5.1 CONDUCT OF BUSINESS. (a) Except to the extent
that Purchaser consents in writing, except as set forth in Section 5.1 of
the Seller Disclosure Schedule and except as expressly contemplated by this
Agreement, between the date hereof and the Closing, Seller shall, and shall
cause its Subsidiaries to, (i) use commercially reasonable efforts to
maintain satisfactory relationships with customers, suppliers and Business
Employees, (ii) subject to the terms of the Intermodal Leases which in
certain cases require the lessees of Intermodal Assets to maintain the
Intermodal Assets in good operating condition (ordinary wear and tear
excepted), not defer the maintenance practices of Seller in effect on or
prior to the date hereof, and (iii) maintain the books, accounts and
records relating to the Acquired Assets on a basis consistent with past
practice.
(b) Seller agrees that, between the date hereof and
Closing, except (A) as expressly contemplated by this Agreement, (B) as
otherwise consented to by Purchaser in writing or (C) as set forth in
Section 5.1 of the Seller Disclosure Schedule, Seller shall not, and shall
cause the Designated Subsidiaries not to:
(i) other than in the ordinary course of
business, enter into or amend or modify in any material respect any
Material Contract;
(ii)sell any of the Intermodal Assets, other than
(1) up to one hundred Domestic Containers with a manufacture date prior to
January 1, 1989, (2) prior to April 30, 2001 up to five hundred Intermodal
Trailers with a manufacture date prior to January 1, 1990, (3) prior to
August 31, 2001 up to one thousand Intermodal Trailers with a manufacture
date prior to January 1, 1990 and (4) sales of Destroyed Equipment;
(iii)create or suffer to exist any new
Encumbrance on any of the Acquired Assets, except for (A) Permitted
Encumbrances and (B) leases on Intermodal Assets;
(iv)except for purchase orders for, or purchase
of, equipment to be used for purposes of entering into Financing Leases,
purchase any domestic container (or make any commitment with respect
thereto) which would constitute an Intermodal Asset, other than purchases
and commitments from September 30, 2000 which do not exceed $4,000,000 in
the aggregate (any purchases and commitments from September 30, 2000
through the date hereof are listed on Section 5.1 of the Seller Disclosure
Schedule);
(v) purchase any intermodal trailer;
(vi)increase the number of units of Leased-In
Equipment;
(vii)waive or release any rights under any
Management Agreement or lease relating to the rental of any Intermodal
Assets by customers, in each case, which constitutes an Acquired Asset,
other than waivers and releases in the ordinary course of business;
(viii) grant or agree to grant any general
increases in the rates of salaries or compensation payable to any Business
Employee, except in the ordinary course of business;
(ix)change any of the material terms or
conditions of employment of any Business Employee, except in the ordinary
course of business;
(x) enter into any agreement, contract,
commitment or arrangement to do any of the foregoing, or authorize,
recommend, propose or announce an intention to do, any of the foregoing;
(xi)take, or agree to or commit to take, any
action that would make any representation or warranty of Seller contained
herein inaccurate at the Closing; or
(xii)otherwise operate the business with respect
to the Acquired Assets and Assumed Liabilities outside of the ordinary
course of business.
(c) In the event that (i) Seller or any of its
Subsidiaries receives a payment from a lessee of Intermodal Assets with
respect to damages which were sustained by one or more specified Intermodal
Assets leased by such lessee, (ii) Seller and its Subsidiaries do not
expend such payment in the repair of such Intermodal Asset(s) and (iii)
such Intermodal Asset(s) are, at the Closing, not in good operating
condition (normal wear and tear excepted), then Seller shall pay to
Purchaser an amount equal to the lesser of (i) the amount of such payment
(or the remaining portion if a portion of such payment was expended in
repairs of such Intermodal Asset(s)) and (ii) the actual cost of repairing
such Intermodal Asset(s). Purchaser shall have reasonable access to the
books and records of Seller during normal business hours to confirm
Seller's compliance with this Section 5.1(c).
SECTION 5.2 ACCESS; CONFIDENTIALITY; COOPERATION. (a) Seller
agrees to permit Purchaser and its accountants, counsel and other
authorized representatives to have, during the period from the date hereof
to the Closing Date, reasonable access to the Acquired Assets over which
Seller has physical control, and the premises, books and records of Seller
and the Designated Subsidiaries that relate to the Acquired Assets. Seller
agrees to make available to Purchaser, upon reasonable advance notice and
during normal business hours, the officers and employees of Seller and the
Designated Subsidiaries, as Purchaser may reasonably request; provided,
however, that such availability shall not interfere with the normal
operations of Seller and its Subsidiaries. Seller shall furnish Purchaser
with such financial and operational data and other information with respect
to the Acquired Assets as Purchaser shall from time to time reasonably
request and as are maintained by Seller in the ordinary course of business.
Notwithstanding the foregoing, except as expressly contemplated by Section
5.1 of this Agreement, Seller and Purchaser hereby agree that until the
Closing shall occur, Purchaser shall have no right to direct or control the
Acquired Assets in any manner whatsoever. Any information regarding the
business of Seller or the Acquired Assets heretofore or hereafter obtained
from Seller or its Subsidiaries by Purchaser or its representatives shall
be subject to the terms of the Confidentiality Agreement, and such
information shall be held by Purchaser and its representatives in
accordance with the terms of the Confidentiality Agreement, provided,
however, that following the Closing, this Section 5.2 and the
Confidentiality Agreement shall not prohibit Purchaser from using and
providing to third parties such information concerning the Acquired Assets
(but not any other assets, liabilities or other information relating to
Seller or its business) as it may deem appropriate.
(b) Between the date hereof and the date ninety days
following the Closing Date, Seller shall cooperate and make its personnel,
consultants and records relating to the Acquired Assets available in
accordance with the reasonable requests of Purchaser so as to enable
Purchaser to plan for putting itself in a position to effectively own,
operate and manage the Acquired Assets from and after the Closing Date.
Pursuant to the foregoing, Seller will reasonably assist Purchaser in
connection with Purchaser's planning for car accounting and billing and
also will assist in arranging for meetings with Seller's vendors and
customers. Nothing in this Section 5.2(b) shall require or obligate Seller
to retain personnel after the date hereof in order to assist and cooperate
with Purchaser except to the extent that Seller shall endeavor to retain
personnel if requested by Purchaser if Purchaser agrees to reimburse Seller
for all costs of Seller relating thereto.
SECTION 5.3 TAKING OF NECESSARY ACTION. (a) Each of the
parties hereto agrees to use its commercially reasonable efforts to take or
cause to be taken all action and promptly do or cause to be done all things
necessary, proper or advisable to consummate and make effective the
transactions contemplated hereby.
(b) Each of Seller and Purchaser and their respective
Affiliates shall (i) as soon as practicable after the date hereof, file
such applications, notices, registrations and requests as may be required
or advisable to be filed by it with any Governmental Authority in
connection with the transactions contemplated hereby, (ii) furnish the
other party with copies of all documents (or in the case of sensitive or
proprietary information contained in "4(c) documents" to the other party's
representative) and correspondence (A) prepared by or on behalf of such
party for submission to any Governmental Authority and (B) received by or
on behalf of such party from any Governmental Authority, in each case in
connection with the transactions contemplated hereby and (iii) consult with
and keep the other party informed as to the status of such matters. To the
extent that any application, notice, registration or request so filed
contains any significant information relating to the other party or any of
such other party's Affiliates, prior to submitting such application,
notice, registration or request to any Governmental Authority, each party
will permit the other party to review such information and will consider in
good faith the suggestions of the other party with respect thereto. Each
party shall have the right to approve any such information that relates to
it, and its Affiliates, or, in the case of Seller, the Acquired Assets and
the Assumed Liabilities (which approval shall not be unreasonably
withheld).
(c) Purchaser and Seller agree to promptly (but in no
event later than five Business Days after the date hereof) effect all
necessary registrations and filings, including, but not limited to, filings
under the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of 1976, as amended
("HSR Act"), and submissions of information requested by Governmental
Authorities. Subject to Section 5.3(d) hereof, Purchaser agrees to promptly
take, and cause its Affiliates controlled by Purchaser to take, if required
by the Federal Trade Commission (the "FTC") or its staff, the Assistant
Attorney General in charge of the Antitrust Division (the "Antitrust
Division") and his staff, or any state attorney general or its staff, in
each case in order to consummate the transactions contemplated by this
Agreement, all actions and things (including, without limitation, executing
agreements and submitting to judicial or administrative orders) to secure
federal and state government antitrust clearance (including by avoiding or
setting aside any preliminary or permanent injunction or other order of any
United States federal, state or local court or other Governmental
Authority), including, without limitation, all actions to make arrangements
for, or to effect the sale or other disposition or divestiture of,
non-material assets or categories of assets, businesses, or the Acquired
Assets (it being agreed by the parties that solely for purposes of this
Section 5.3, a divestiture, sale or disposition of assets with an aggregate
value in excess of $8,000,000 (valued for these purposes by using Assigned
Values for Acquired Assets and net book value for all other assets) shall
be considered "material") and to hold separate (including, without
limitation, pursuant to arrangements which restrict, limit or prohibit
access to Purchaser or any of its Affiliates and/or the exercise of any
other rights with respect to the Acquired Assets) pending such sale or
other non-material disposition or divestiture. Purchaser represents and
warrants to the Seller that Purchaser and its Affiliates have or will have
in a timely manner full power and authority to effect the transactions
contemplated by this Section 5.3(c). In lieu of any sale, disposition or
divestiture of such non-material Acquired Assets which are domestic
containers subject to an existing lease, as contemplated by the preceding
sentence, Purchaser may, at its option, elect to treat such domestic
containers subject to an existing lease as Excluded Assets, in which case a
corresponding adjustment shall be made to the Purchase Price equal to the
Assigned Equipment Value of the assets so designated as Excluded Assets.
(d) Notwithstanding Section 5.7(c) hereof, in no event
shall the Purchaser be obligated to accept any condition or requirement
imposed by a Governmental Authority (i) that relates to the divestiture of
assets in excess of the $8,000,000 maximum value set forth in subsection
(c) above, or (ii) with respect to any requirement other than a divestiture
of assets, which, in Purchaser's reasonable judgment, would have more than
a de minimis effect on the business or operations of Purchaser.
(e) Each party shall cooperate with the other party in
the preparation and filing of any applications, notices, registrations and
responses to requests for additional information from Governmental
Authorities made by the other party with any Governmental Authority in
connection with the transactions contemplated hereby, including providing
such information as the other party may reasonably request for inclusion in
such applications, notices, registrations and responses.
SECTION 5.4 RELEASE OF SELLER FROM ASSUMED LIABILITIES.
(a) Purchaser shall, at or prior to the Closing, use its
commercially reasonable efforts to enter into such valid and enforceable
agreements, instruments, and other documents in forms satisfactory to
Seller (collectively, the "Novated Exclusive Contracts") to effect a
novation as of the Closing of certain of the agreements set forth on
Section 5.4(a) of the Seller Disclosure Schedule (whereby (1) Purchaser
shall be substituted for Seller and its Subsidiaries thereunder and (2) the
other parties to such agreements absolutely and unconditionally release
Seller and its Subsidiaries from all obligations and liabilities thereunder
(including the Indebtedness thereunder)). The obligations of Purchaser
under such agreements, instruments and other documents shall be limited to
assuming Seller's Liabilities, obligations, covenants and agreements under
such agreements, instruments and documents and acting in conformity with
the terms and provisions set forth therein.
(b) Purchaser shall, at or prior to the Closing, use its
commercially reasonable efforts to enter into such valid and enforceable
agreements, instruments, and other documents in forms satisfactory to
Seller (collectively, the "Novated Non-Exclusive Contracts" and, together
with the Novated Exclusive Contracts, the "Novated Contracts") to effect a
novation as of the Closing of the rights and obligations relating to
Intermodal Assets under certain of the agreements set forth on Section
5.4(b) of the Seller Disclosure Schedule (whereby (1) Purchaser shall be
substituted for Seller and its Subsidiaries thereunder with respect to the
Intermodal Assets through a separate agreement to which Seller and its
Affiliates are not a party and (2) the other parties to such agreements
absolutely and unconditionally release Seller and its Subsidiaries from all
obligations and liabilities thereunder relating to the Intermodal Assets
(including the Indebtedness thereunder)). The obligations of Purchaser
under such agreements, instruments and other documents shall be limited to
assuming Seller's Liabilities, obligations, covenants and agreements under
such agreements, instruments and documents and acting in conformity with
the terms and provisions set forth therein. In the event that Purchaser is
unable to enter into Novated Contracts, it shall use commercially
reasonable efforts to enter into such valid and enforceable agreements,
instruments and other documents in forms satisfactory to Seller with the
objective of making Purchaser the primary obligor with respect to the
Indebtedness under the Scheduled Leases-in Transactions. The obligations of
Purchaser under such agreements, instruments and other documents shall be
limited to assuming Seller's Liabilities, obligations, covenants and
agreements under such agreements, instruments and documents and acting in
conformity with the terms and provisions set forth therein. General
Electric Capital Corporation, a New York corporation, shall indemnify and
hold harmless Seller and its Subsidiaries from any and all claims and
Indebtedness and any payment thereof (including costs and expenses)
relating to any of the Scheduled Lease-In Transactions which are not
novated as of the Closing.
SECTION 5.5 INSURANCE; RISK OF LOSS. (a) Effective as of the
Closing, Seller will terminate or cause its Subsidiaries to terminate all
coverage relating to the Acquired Assets and the Assumed Liabilities and
Transferred Employees under the general corporate policies of insurance,
cancellable surety bonds and hold harmless agreements of Seller for the
benefit of all of its controlled subsidiaries. From and after the Closing,
Purchaser shall become solely responsible for all insurance coverage
(including self-insurance) and related risk of loss with respect to the
Acquired Assets and the Assumed Liabilities and Transferred Employees.
(b) Notwithstanding clause (a), to the extent that (i)
any insurance policies controlled by Seller and its Subsidiaries ("Seller's
Insurance Policies") cover any Liability, loss, damage or expense that
constitutes an Assumed Liability ("Business Liabilities") and arises out of
occurrences, events or circumstances prior to the Closing and (ii) Seller's
Insurance Policies continue after the Closing to permit claims to be made
thereunder with respect to Business Liabilities arising out of occurrences,
events or circumstances prior to the Closing ("Business Claims"), Seller
shall reasonably cooperate with Purchaser in submitting Business Claims (or
pursuing Business Claims previously made) on behalf of Purchaser under
Seller's Insurance Policies; provided, however, that Seller shall be under
no obligation to commence or maintain litigation to enforce any Business
Claim (except to the extent that Purchaser agrees to reimburse Seller
therefor and to hold Seller harmless, in each case, under written terms
acceptable to Seller in connection therewith).
SECTION 5.6 MAIL; PAYMENTS.
(a) Seller hereby authorizes Purchaser after the Closing
to receive and open all mail and other communications received by Purchaser
with respect to the Acquired Assets and the Assumed Liabilities, and to act
with respect to such communications in such manner as Purchaser may elect
if such communications primarily relate to the Acquired Assets or the
Assumed Liabilities, or, if such communications do not so primarily relate,
to forward the same promptly to Seller together with any moneys, checks or
other instruments of payment to which Purchaser is not entitled under the
terms of this Agreement. Seller shall promptly deliver to Purchaser the
original of any mail or other communication received by Seller of any of
its Subsidiaries after the Closing primarily relating to the Acquired
Assets or the Assumed Liabilities and any moneys, checks or other
instruments of payment to which Purchaser is entitled under the terms of
this Agreement.
(b) After the Closing, Purchaser shall have the right and
authority to endorse, without recourse, the name of Seller or any of its
Subsidiaries on any check or any other cash equivalent received by
Purchaser on account of any of the Acquired Assets or the Assumed
Liabilities. After the Closing, Purchaser shall promptly remit to Seller
all or such portion of any such payments which have been received by
Purchaser or any of its Affiliates in respect of rentals of Intermodal
Assets with respect to any period ending prior to or on the Closing Date or
in respect of any payment relating to Excluded Assets or Excluded
Liabilities.
(c) Any payment received by Seller or any of its
Subsidiaries after the Closing to the extent relating to the rentals of any
of the Intermodal Assets for any periods commencing after the Closing Date
shall be promptly remitted to Purchaser. Any payments received by Seller or
any of its Subsidiaries prior to or after the Closing Date relating to the
rental of Intermodal Assets for period both before and after the Closing
shall be pro-rated and the pro-rated portion shall be promptly remitted to
Purchaser.
(d) To the extent that, following the Closing, Purchaser
receives or possesses any Excluded Asset or any Excluded Liability, then
Purchaser shall transfer such Excluded Asset or Excluded Liability to
Seller as soon as practically possible thereafter.
(e) To the extent that, following the Closing, Seller
receives or possesses any Acquired Asset or any Assumed Liability, then
Seller shall transfer such Acquired Asset or Assumed Liability to Purchaser
as soon as practically possible thereafter.
SECTION 5.7 LICENSE OF INTERPOOL NAME. (a) Seller hereby
grants to Purchaser a fully-paid, royalty-free and non-exclusive license to
use the Interpool Trademarks and Interpool Prefixes, in connection with and
as a part of the Interpool Assets (the "License") for the relevant period
of time from and after the Closing Date as set forth in the following
sentence (the "License Term") and subject to the following provisions of
this Section 5.7. The License granted to Purchaser hereunder authorizes
Purchaser to continue to use the Interpool Trademarks and the Interpool
Prefixes that appear on an Intermodal Asset as of the Closing Date for the
life of that Intermodal Asset without obligation to remove, cover or
otherwise obscure the appearance of the Interpool Trademarks or Interpool
Prefixes thereon; provided, however, that if any Interpool Asset is
refurbished or ceases, directly or indirectly, to be owned by Purchaser,
then in either case the License with respect to such Interpool Asset shall
terminate and Purchaser shall promptly remove any Interpool Trademarks or
Interpool Prefixes thereon. In no event may Purchaser use the Interpool
Trademarks on any trailer or container or other equipment not acquired
hereunder. At the expiration of the License Term, all such use of the
Interpool Trademarks and Interpool Prefixes by Purchaser shall cease.
(b) Purchaser hereby waives and disclaims any right or
interest in or to ownership of the Interpool Trademarks that may arise
under any Applicable Law out of the use hereunder of the Interpool
Trademarks and acknowledges that its right to use the Interpool Trademarks
and the Interpool Prefixes is solely to the extent provided in subsection
(a) above. No right to assign, transfer or sublicense the Interpool
Trademark is included herein, and such rights to use the Interpool
Trademark are expressly withheld, except that Purchaser may assign or
otherwise transfer its License to use the Interpool Trademark hereunder to
its Subsidiaries or by operation of law in a merger (subject to the
provisions of this Section 5.7); provided, however, that in the event that
such Subsidiary ceases to be a Subsidiary of Purchaser, the rights
hereunder assigned or otherwise transferred shall immediately terminate.
Purchaser may not assign, sublicense or otherwise transfer, directly or
indirectly, the License (or any portion thereof) granted hereunder except
by operation of law in a merger (subject to the provisions of this Section
5.7).
(c) Purchaser hereby acknowledges that it has no rights
or ownership or other interests in the Transamerica Names, the Transamerica
Trademarks and the Transamerica Prefixes (the "Transamerica License").
Purchaser, Seller and Transamerica shall, concurrently with entering into
this Agreement, enter into an agreement authorizing Seller to sublicense
the Transamerica Names, Transamerica Trademarks and Transamerica Prefixes
to the Purchaser (the "Consent Agreement"), subject to the provisions of
Sections 6.10(a), (b), and (c) of the Transamerica Agreement and any
additional terms contained in the Consent Agreement, which shall be
incorporated herein by reference.
SECTION 5.8 REGISTRATION. Purchaser shall, as soon as
reasonably practicable following the Closing Date, make application for and
effect a change in all of the registrations and licenses with respect to
the Intermodal Assets from Seller or an Affiliate thereof (or any
predecessor in interest) to Purchaser. Any registration fees or charges
associated with the registration and licensing of Purchaser as owner of the
Intermodal Assets shall be paid by Purchaser and any refunds of such
registration fees already paid by or on behalf of Seller or an Affiliate
thereof shall be for Seller's account and, if paid to Purchaser or an
Affiliate thereof, shall promptly be paid over by Purchaser to Seller.
Prior to Closing, Seller shall use its commercially reasonable efforts to
renew all registrations and licenses with respect to Intermodal Assets that
are scheduled to expire within 30 days after the Closing Date.
SECTION 5.9 ASSIGNED CONTRACTS. Seller shall use its
commercially reasonable efforts to obtain any consent, approval or
amendment required to novate and/or assign any Contract included in the
Acquired Assets, provided that Seller shall not be required to pay in
excess of $100,000 per contract in connection therewith unless otherwise
agreed by the parties. Seller shall keep Purchaser reasonably informed from
time to time of the status of the foregoing and Purchaser shall cooperate
with Seller in this regard. To the extent that the rights of Seller or any
of its Subsidiaries under any Contract included in the Acquired Assets, or
under any other Acquired Asset to be assigned to Purchaser hereunder, may
not be assigned without the consent of another Person which has not been
obtained prior to the Closing, neither this Agreement nor any of the
Instruments of Transfer shall constitute an agreement to assign the same if
an attempted assignment would be unlawful. If any such consent has not been
obtained or if any attempted assignment would be ineffective or would
impair Purchaser's rights under the instrument in question so that
Purchaser would not acquire the benefit of all such rights, then Seller or
a Subsidiary thereof, as applicable, to the maximum extent permitted by
Applicable Law and the instrument, shall act as Purchaser's agent in order
to obtain for Purchaser the benefits thereunder and shall cooperate, to the
maximum extent permitted by Applicable Law and the instrument, with
Purchaser in any other reasonable arrangement designed to provide such
benefits (and the corresponding burdens) to Purchaser (including by
entering into an equivalent arrangement). Except with respect to the
exercise of the rights under any such unassigned Contract at the direction
of the Purchaser, the Seller and its Subsidiaries shall have no obligation
to pay, perform or discharge any obligations under any such unassigned
Contract after the Closing. Any failure so to obtain for Purchaser the
benefits under any such Acquired Assets shall result in the payment by
Seller to Purchaser of an amount equal to the value of such Acquired Asset.
SECTION 5.10 BULK SALES WAIVER. Purchaser and Seller hereby
waive compliance with the terms and conditions of any applicable bulk sales
or bulk transfer law or similar laws that may be applicable to the bulk
sale or bulk transfer of the Acquired Assets and Assumed Liabilities.
Seller will indemnify and hold harmless Purchaser from any and all claims
relating to the provisions of the "bulk sales law" of any applicable
jurisdiction with respect to the transactions contemplated by this
Agreement.
SECTION 5.11 PUBLIC ANNOUNCEMENTS. Prior to the Closing,
Seller and Purchaser will use reasonable efforts to consult with each other
about any description of the transactions contemplated by this Agreement
contained in any press release or other public statements prior to the
issuance thereof and provide each other with the opportunity to review and
comment upon any such description, and shall not issue any such press
release or make any such public statement prior to such consultation,
except as may be required by applicable law, court order or by obligations
pursuant to any listing agreement with any national securities exchange.
The parties shall use reasonable efforts to agree on the description of the
transactions contemplated by this Agreement contained in any initial press
releases to be issued by the parties with respect to their execution and
delivery of this Agreement.
SECTION 5.12 NOTICES OF CERTAIN EVENTS. Seller and Purchaser
will use commercially reasonable efforts to promptly notify each other of,
and cure before the Closing, any event, transaction or circumstance, that
such party learns has caused or will cause any covenant or agreement of
such party under this Agreement to be breached or that renders or will
render untrue any representation or warranty of such party contained in
this Agreement in each case so as to cause a condition to Closing not to be
satisfied. No notice given pursuant to this paragraph shall have any effect
on the representations, warranties, covenants or agreements contained in
this Agreement for purposes of determining satisfaction of any condition
contained herein.
SECTION 5.13 FURTHER ASSURANCES. Each party shall cooperate
with the other, and execute and deliver, or use its commercially reasonable
efforts to cause to be executed and delivered, all such other instruments,
including instruments of conveyance, assignment and transfer, and to make
all filings with and to obtain all consents, approvals or authorizations of
any Governmental Authority or other regulatory authority or any other
Person under any Permit, agreement, indenture or other instrument, and take
all such other actions as such party may reasonably be requested to take by
the other party hereto from time to time, consistent with the terms of this
Agreement, in order to effectuate the provisions and purposes of this
Agreement and the transactions contemplated hereby. Seller shall provide
Purchaser with reasonably satisfactory evidence that the Acquired Assets as
of Closing will be released from liens under the credit agreement between
Seller and Citicorp USA, Inc. dated as of October 24, 2000 and the
revolving credit agreement with First Union National Bank and will use
commercially reasonable efforts to remove any other Encumbrances other than
Permitted Encumbrances on the Acquired Assets. Interpool agrees that prior
to the Closing, Purchaser's request for data from Transamerica will be
given reasonable priority over any other requests for data made by
Interpool during such period.
SECTION 5.14 TRANSITION SERVICES AGREEMENT. Purchaser shall
execute counterparts to the Transition Services Agreement and deliver such
counterparts to Seller at the Closing. Seller shall execute counterparts to
the Transition Services Agreement and deliver such counterparts to
Purchaser at the Closing.
SECTION 5.15 PACER JOINT VENTURE.
(a) Seller and Purchaser shall negotiate in good faith
with Pacer International, Inc. ("Pacer") to restructure the operations of
PAMC LLC, a joint venture between Pacer and Interpool ("PAMCO") (and the
agreements relating to PAMCO) into two joint ventures with terms
substantially comparable to the terms of PAMCO, except that (i) one joint
venture shall be between Purchaser and Pacer and shall relate to the
Intermodal Assets which are the subject of PAMCO and (ii) the second joint
venture shall be between Seller and Pacer and shall relate to all equipment
which is the subject of PAMCO (other than Intermodal Assets). The parties
agree that they shall use their joint best efforts to so split the PAMCO
joint venture into two Joint Ventures.
(b) In the event that the Seller and Purchaser are unable
to reach agreement with Pacer to restructure PAMCO in the manner described
in clause (a) above, then Purchaser shall effective as of the Closing lease
(the "Container Lease") to Seller the domestic containers (the "PAMC
Containers") subject to the Management Agreement, dated as of May 28, 1999,
between PAMC LLC ("PAMC") and Transamerica Leasing Inc. and Seller as
assignee of Transamerica Leasing Inc. (the "PAMC Management Agreement")
under the same terms and conditions as set forth in the PAMC Management
Agreement (with Purchaser having the same rights and obligations as if it
were the "Owner" (as such term is defined in the PAMC Management Agreement)
of the PAMC Containers under the PAMC Management Agreement and Seller
having the same rights and obligations as if it were the "Manager" (as such
term is defined in the PAMC Management Agreement) of the PAMC Containers
under the PAMC Management Agreement). Purchaser agrees and acknowledges
that PAMC LLC shall continue to manage the PAMC Containers under the PAMC
Management Agreement, and Seller agrees to act on Purchaser's behalf as
agent in good faith in connection with the PAMC Management Agreement as
directed by Purchaser regarding any action with respect to the PAMC
Containers in order to seek to provide Purchaser with the benefits of the
"Owner" under the PAMC Management Agreement with respect to the PAMC
Containers, including, without limitation, commencing actions to enforce
the Equipment Use Agreement. Seller agrees not to make or agree to any
modification or amendment to the PAMC Management Agreement which affects
the PAMC Containers without the prior consent of Purchaser. Seller agrees
not to make or agree to make any modification or amendment to the Equipment
Use Agreement (including the Schedules thereto) between PAMC LLC and Pacer
International, Inc. which affect the PAMC Containers, unless the failure to
make such modification or amendment would violate such agreement or give
rise to any liability of Seller (including as manager of PAMC), without the
prior consent of Purchaser. At the Closing, Seller agrees to collaterally
assign to Purchaser Interpool's right to receive rents under the PAMC
Management Agreement pursuant to a collateral assignment agreement in a
form reasonably satisfactory to Purchaser and Seller. Purchaser and Seller
further agree to jointly use their commercially reasonable efforts to enter
into an intercreditor agreement with any third party lenders of Seller who
take any security interest as collateral in Seller's interest in the
receivables under the PAMC Management Agreement. Purchaser and Seller agree
that Seller shall not be entitled to receive any additional consideration
for acting on behalf of Purchaser as contemplated by this Section 5.15,
except that Purchaser shall reimburse Seller for all of its out-of-pocket
costs incurred by Seller in connection with taking any action contemplated
by this Section 5.15 (b). Purchaser agrees to indemnify and hold harmless
Seller and its Affiliates, officers, directors, employees, agents,
successors and assigns, and related entities from, and reimburse them for,
any loss, cost, deficiency, demand, assessment, expense (including all
reasonable legal and expert fees and expenses), demise, liability, fine,
penalty or claim arising from any action which is taken by Seller at the
direction of Purchaser in connection with PAMCO or the PAMC Management
Agreement. It is acknowledged and agreed by Purchaser that notwithstanding
anything to the contrary set forth in this Section 5.15(b), Seller shall
have no obligation to take any action with respect to PAMCO or the PAMC
Management Agreement except as directed by Purchaser hereunder, provided,
however that Seller shall keep Purchaser reasonably informed on a timely
basis of developments regarding PAMCO and the PAMC Management Agreement
relating to the PAMC Containers.
SECTION 5.16 COVENANT NOT TO COMPETE.
(a) Subject to paragraph (b) below, for a period of three
and one-half (3-1/2) years with respect to domestic containers and five
years with respect to intermodal trailers from and after the Closing (the
"Non-Compete Period"), the Seller agrees that it shall not, and Seller
shall cause its Subsidiaries not to, engage directly or indirectly in
Mexico, Canada or the United States in the leasing or rental of domestic
containers or intermodal trailers; provided, however, that the foregoing
will not preclude Seller or its Subsidiaries from engaging and continuing
to engage in (i) the provision and marketing of Financing Leases or TRAC
Leases or installment loans relating to intermodal trailers or domestic
containers and (ii) entering into any operating leases with a customer for
domestic containers and/or intermodal trailers if required by a customer in
conjunction with the rental of chassis to such customer pursuant to a
published or official request for bids or proposals, provided that Seller
shall not enter into such operating leases with customers with respect to
more than an aggregate of 1,000 containers and/or trailers per annum, on a
non-cumulative basis, during the applicable Non-Compete Period and (iii)
the operations conducted by PAMC LLC and as agent for Purchaser as
contemplated by Section 5.15 hereof. For purposes of this Section 5.16(a),
"Financing Lease" shall mean a finance lease or full payout lease in which
(i) the lessee has a purchase option to acquire the equipment subject to
such lease at the end of the lease term and where such purchase option
shall be a "bargain purchase option" (as such term is defined in paragraph
5(d) of Statement of Financial Accounting Standards No. 13 Accounting for
Leases as of the date hereof), (ii) the lease term, in the case of new
equipment, shall be at least seven years and, in the case of used
equipment, shall be at least the greater of (A) three years and (B) if the
equipment is less than seven years' old, the difference between seven and
the age of the subject unit, and (iii) any early termination penalty or
payment payable upon exercise of a termination option or right exercisable
prior to the year that the unit is seven years' old shall have terms that
are competitive in the marketplace (such business which is prohibited under
this clause (a) and not subject to the proviso of the first sentence hereof
being referred to as a "Competitive Business"). For purposes of this
Section 5.16, "domestic containers" means containers exclusively used for
carrying domestic freight in the United States, Canada or Mexico and
"intermodal trailers" means trailers used by the United States railroads
(e.g. trailers placed in flatcars).
(b) Notwithstanding the provisions of paragraph (a)
above, (i) Seller and its Subsidiaries may invest in up to 25% of the
outstanding voting securities as passive investors in any entity that is
engaged in any Competitive Business and that has a class of equity
securities registered under the Securities Exchange Act of 1934, so long as
neither Seller nor any of its Subsidiaries manages or exercises control
over such legal entity, (ii) Seller and its Subsidiaries may engage in a
Competitive Business with any equipment which becomes an Excluded Asset
pursuant to Section 5.3(c) hereof, (iii) Seller and its Subsidiaries may
engage in a Competitive Business with any Excess New Equipment not
purchased by Purchaser, and (iv) Seller and its Subsidiaries shall not be
prohibited from acquiring any Person engaged in a Competitive Business or
acquiring any business, division or assets of any Person which would
constitute a Competitive Business provided, however, that if Seller (A)
acquires (x) any Person of which a Competitive Business represents 35% or
more of its net assets or (y) any business, division or assets which would
constitute a Competitive Business and which represents 35% or more of the
net assets being sold or (B) if Seller acquires any Person or any business,
division or assets of any Person which has or would constitute a
Competitive Business and the aggregate purchase price of such acquisition
is less than $35 million, then Seller shall (1) use commercially reasonable
efforts within a six-month time period from the acquisition of such
Competitive Business to attempt to effect the sale or other disposition or
divestiture of such Competitive Business, business, division or assets and
(2) if within such six-month time period referred to in clause (1) above,
Seller shall not have sold, disposed of or divested such Competitive
Business, business, division or assets, the Seller shall offer to sell such
Competitive Business to Purchaser at the then net book value of the assets
constituting such Competitive Business, and (3) if Purchaser shall not,
within sixty (60) days of the offer referred to in clause (2) above, have
entered into a definitive agreement to purchase such Competitive Business
(or if such agreement is entered into, Purchaser, within five months of
execution of such agreement, shall have failed to consummate such
purchase), then Seller shall be free to engage in such Competitive
Business.
(c) The provisions of the covenant contained in paragraph
(a) above shall be deemed to be a separate covenant in each of Mexico,
Canada or the United States and in each of the states of the United States.
The parties acknowledge and agree that the time, scope, and other
provisions of paragraph (a) above have been specifically negotiated by
sophisticated, commercial parties and specifically hereby agree that such
time, scope and other provisions are reasonable under the circumstances.
The parties further agree that if, at any time, despite the express
agreement of the parties, a court of competent jurisdiction holds that any
portion of paragraph (a) above is unenforceable because any of the
restrictions therein are unreasonable, or for any other reason, such
decision shall not affect the validity or enforceability of any of the
other provisions of this Agreement, and the maximum restrictions of time or
scope reasonable under the circumstances, as determined by such court, will
be substituted for any such restrictions which are held unenforceable. In
the event of a breach by any party of any of the provisions of paragraph
(a) above, the parties acknowledge that such breach may cause irreparable
damage to Purchaser, the exact amount of which may be difficult to
ascertain, and the remedies at law for any such breach may be inadequate.
Accordingly, the Purchaser may be entitled, in addition to any other rights
or remedies existing in their favor, to seek specific performance and
injunctive relief in order to enforce or prevent breach of any such
provisions.
SECTION 5.17 LICENSES AND TITLES. Prior to the Closing,
Seller shall provide Purchaser with Seller's written authorization for
Purchaser to retain Seller's license plates and to effect a change in the
registrations for Intermodal Assets from Seller to Purchaser, as owner.
ARTICLE VI
EMPLOYEE MATTERS
SECTION 6.1 BUSINESS EMPLOYEES. For purposes of this
Agreement, the term "Business Employees" shall mean all persons employed by
Seller or any of its Affiliates immediately prior to the Closing Date and
who are listed on Section 6.1 of Seller Disclosure Schedule, including
without limitation, employees who are absent from work on account of
sickness, vacation or leave of absence (including any person on disability
leave) or for whom an obligation to recall, rehire or otherwise return to
employment exists under Applicable Law or contract. As of the date hereof,
Seller has provided Purchaser with a preliminary list of Business
Employees, including each such employee's job/position/title, salary or
grade level, and target bonus. Seller agrees to provide Purchaser with an
update to such list of Business Employees each month prior to the Closing,
based upon new employees hired by the Business and departures of Business
Employees as of the date of such update.
SECTION 6.2 EMPLOYMENT. Prior to the Closing Date, Purchaser
shall make an offer of employment to each Business Employee selected by
Purchaser in its sole discretion, such employment to be effective as of the
Closing Date. Purchaser agrees to provide Seller with (i) a list of the
Business Employees to whom employment offers will be extended no later than
30 days following the date hereof and (ii) a list of the Business Employees
who have accepted Purchaser's offer of employment as soon as is
practicable, but in no event later than five (5) days prior to the Closing
Date. Notwithstanding anything contained herein to the contrary,
Purchaser's hiring procedures will comply with Applicable Law. Those
Business Employees who have been offered employment by Purchaser and who
accept such offers of employment shall be referred to herein as the
"Transferred Employees."
SECTION 6.3 EMPLOYEE BENEFITS. As of the Closing Date, the
Transferred Employees shall cease active participation in each Benefit Plan
of Seller or its Affiliates and no additional benefits shall be accrued
thereunder in respect of the Transferred Employees.
SECTION 6.4 WORKERS' COMPENSATION. From and after the
Closing, Purchaser shall pay and be responsible for any Liability for
workers' compensation claims that arise out of events with respect to the
Transferred Employees that occur on or after the Closing Date. Seller shall
retain, pay and be responsible for any Liability for worker's compensation
claims that arise out of events with respect to the Transferred Employees
that occur prior to the Closing Date.
ARTICLE VII
CONDITIONS TO THE CLOSING
SECTION 7.1 CONDITIONS OF OBLIGATION OF EACH PARTY. The
respective obligations of Purchaser and Seller to consummate the purchase
and sale of the Acquired Assets and the assumption by Purchaser of the
Assumed Liabilities contemplated hereby are subject to the satisfaction, at
or prior to the Closing, of each of the following conditions:
(a) No Injunction; Litigation. At the Closing, there
shall be no injunction, restraining order or decree of any nature of any
court or Governmental Authority of competent jurisdiction in effect that
restrains or prohibits the purchase of the Acquired Assets and/or
assumption of the Assumed Liabilities hereunder and there shall not be
pending or threatened in writing litigation by a Governmental Authority
relating to the Purchaser's purchase of the Acquired Assets.
(b) Regulatory Authorization. The applicable waiting
period specified under the HSR Act shall have expired or been terminated.
SECTION 7.2 ADDITIONAL CONDITIONS TO THE OBLIGATIONS OF
PURCHASER. The obligation of Purchaser to consummate the purchase of the
Acquired Assets and assumption by Purchaser of the Assumed Liabilities
contemplated hereby is subject to the satisfaction, at or prior to the
Closing, of each of the following additional conditions:
(a) Representations and Warranties. The representations
and warranties of Seller contained in Article III of this Agreement shall
be true and correct in all respects as of the Closing Date as though made
at and as of the Closing Date, except to the extent that any representation
and warranty is made as of a specified date other than the Closing Date, in
which case such representation and warranty shall be true and correct in
all respects as of such date, except, in each case, where the failure to be
so true and correct would not have a Material Adverse Effect (without
giving effect to "materiality", "material" or Material Adverse Effect
qualifications contained in such representations and warranties). In
determining whether this condition is satisfied, any Excluded Assets and
Excluded Liabilities (and any changes in Excluded Assets and Excluded
Liabilities) shall not be taken into account.
(b) Performance of Covenants. Seller shall have performed
in all material respects all obligations and agreements, and complied in
all material respects with all covenants, contained in this Agreement to be
performed or complied with by it prior to or at the Closing.
(c) Certificate. Purchaser shall have received a
certificate of Seller, dated the Closing Date, executed by the chief
executive officer or chief financial officer of Seller, to the effect that
the conditions specified in paragraphs (a) and (b) above have been
fulfilled.
(d) Consents and Approvals. All consents, waivers,
authorizations and approvals of third Persons as are set forth in Section
7.2(d) of the Seller Disclosure Schedule shall have been obtained.
(e) Assignment and Assumption Agreement. Seller shall
have executed counterparts to the Assignment and Assumption Agreement and
delivered them to Purchaser.
(f) Transition Services Agreement; Container Lease.
Seller shall have delivered executed counterparts of the Transition
Services Agreement and, if applicable, the Container Lease to Purchaser.
(g) No Material Adverse Effect. Since the date of this
Agreement there shall not have been any occurrence or development that has
had a Material Adverse Effect or will result in a Material Adverse Effect.
SECTION 7.3 ADDITIONAL CONDITIONS TO THE OBLIGATIONS OF
SELLER. The obligation of Seller to consummate the sale of the Acquired
Assets and assumption by Purchaser of the Assumed Liabilities contemplated
hereby is subject to the satisfaction, at or prior to the Closing, of each
of the following additional conditions:
(a) Representations and Warranties. The representations
and warranties of Purchaser contained in Article IV of this Agreement shall
be true and correct in all respects as of the Closing Date as though made
at and as of the Closing Date, except to the extent that any representation
and warranty is made as of a specified date other than the Closing Date, in
which case such representation and warranty shall be true and correct in
all respects as of such date, except, in each case, where the failure to be
so true and correct would not have a material adverse effect on the
benefits to be provided to Seller from the transactions contemplated
hereby. In determining whether this condition is satisfied, any Acquired
Assets and Assumed Liabilities (and any changes in Acquired Assets and
Assumed Liabilities) shall not be taken into account.
(b) Performance of Covenants. Purchaser shall have
performed in all material respects all obligations and agreements, and
complied in all material respects with all covenants, contained in this
Agreement to be performed or complied with by it prior to or at the
Closing.
(c) Certificate. Seller shall have received a certificate
of Purchaser, dated the Closing Date, executed by the chief executive
officer or chief financial officer of Purchaser, to the effect that the
conditions specified in paragraphs (a) and (b) above have been fulfilled.
(d) Purchase Price. Seller shall have received the
Purchase Price in accordance with Article II hereof.
(e) Assignment and Assumption Agreement. Purchaser shall
have executed counterparts to the Assignment and Assumption Agreement and
delivered them to Seller.
(f) Transition Services Agreement; Container Lease.
Purchaser shall have executed counterparts to the Transition Services, and,
if applicable, the Container Lease and delivered them to Seller.
(g) Novated Contracts. Seller shall have received duly
executed counterparts of novation, and releases of liability to such number
of Scheduled Lease-In Transactions which in the aggregate represent at
least 50% of the total value of the indebtedness under all of the Scheduled
Lease-In Transactions (including 100% of the indebtedness under the
Scheduled Lease-In Transactions owed to GE Capital).
ARTICLE VIII
TERMINATION, AMENDMENT AND WAIVER
SECTION 8.1 TERMINATION. This Agreement may be terminated
and the transactions contemplated hereby abandoned at any time prior to the
Closing:
(a) by mutual written consent of Seller and Purchaser;
(b) by either Seller or Purchaser upon written notice
given to the other party in the event that the Closing shall not have taken
place on or before September 30, 2001 (the "Termination Date);
(c) by either party upon written notice to the other
party in the event that any Governmental Authority (including any court of
competent jurisdiction) the consent of which is necessary for the
consummation of the transactions contemplated hereby shall have issued an
order, decree or ruling permanently enjoining or otherwise prohibiting the
purchase of the Acquired Assets and/or assumption of the Assumed
Liabilities hereunder, and such order, decree or ruling shall have become
final and non-appealable;
(d) by Seller, upon a breach of any covenant or agreement
on the part of Purchaser set forth in this Agreement, or if any
representation or warranty of Purchaser shall have been or become untrue,
in each case such that the conditions set forth in Section 7.3(a) or (b)
would not be satisfied; provided, however, that if any such breach is
curable prior to the Termination Date by Purchaser through the use of its
best efforts, then for so long as Purchaser, following receipt of written
notice of such breach from Seller, shall be using its best efforts to cure
such breach, Seller may not terminate this Agreement pursuant to this
Section 8.1(d);
(e) by Purchaser, upon a breach of any covenant or
agreement on the part of Seller set forth in this Agreement, or if any
representation or warranty of Seller shall have been or become untrue, in
each case such that the conditions set forth in Section 7.2(a) or (b) would
not be satisfied; provided, however, that if any such breach is curable
prior to the Termination Date by Seller through the use of its best
efforts, then for so long as Seller, following receipt of written notice of
such breach from Purchaser, shall be using its best efforts to cure such
breach, Purchaser may not terminate this Agreement pursuant to this Section
8.1(e); or
(f) by Seller or Purchaser on any day after August 31,
2001, if the waiting period under the HSR Act has not expired or terminated
prior to such date of termination.
SECTION 8.2 EFFECT OF TERMINATION. In the event of the
termination of this Agreement as provided in Section 8.1 hereof, this
Agreement shall become null and void and of no further force or effect, and
there shall be no liability or obligation hereunder on the part of the
Seller or the Purchaser or their respective subsidiaries, or any of their
respective directors, officers, employees, affiliates, agents,
representatives, successors or assigns (collectively "Representatives"),
except (i) the obligations of the parties to this Agreement under this
Section 8.2 and Sections 8.3 and 11.2 hereof and the last sentence of
Section 5.2 hereof shall survive any such termination and (ii) the Seller
or the Purchaser, as the case may be, shall have liability to the other if
the basis of the termination is a willful, material breach by such first
party of one or more of the provisions of this Agreement.
SECTION 8.3 LIQUIDATED DAMAGES.
(a) In order to induce Seller to enter into this
Agreement, if this Agreement is terminated by Seller pursuant to Section
8.1(d) as a result of a material and willful breach by Purchaser, then
Purchaser shall pay Seller liquidated damages in the amount of five million
dollars ($5,000,000). Such payment will be made by Purchaser within two
days of any such termination by wire transfer of immediately available
funds to an account designated by Seller.
(b) In order to induce Purchaser to enter into this
Agreement, if this Agreement is terminated by Purchaser pursuant to Section
8.1(e) as a result of a material and willful breach by Seller (it being
understood by the parties that a material adverse effect on Seller's
business or on the condition of the Acquired Assets or any breach of the
Agreement resulting from the performance or operation of the business or
the Acquired Assets or Assumed Liabilities shall not be considered a
willful breach by Seller), then Seller shall pay Purchaser liquidated
damages in the amount of five million dollars ($5,000,000). Such payment
will be made by Seller within two days of any such termination by wire
transfer of immediately available funds to an account designated by
Purchaser.
(c) The parties agree that, the liquidated damages amount
set forth in Sections 8.3(a) and (b) hereof (i) shall be the sole and
exclusive remedy of Seller or Purchaser for any claim, loss, cost, expense,
damage or liability or obligation relating to the Agreement and the
transactions contemplated hereby in the event such amount is payable to and
paid in full to Seller or Purchaser, as the case may be, and (ii) is
reasonable in proportion to the probable damages likely to be sustained by
Seller or Purchaser, as the case may be, if the transactions contemplated
hereby are not consummated under the circumstances upon which such amount
becomes payable to Seller or Purchaser, as the case may be. The parties
agree and acknowledge that the amount of actual damages to be sustained by
Seller or Purchaser in the event of the nonconsummation of the transaction
under the circumstances referred to above is uncertain and difficult to
predict at this time and incapable of precise estimation.
SECTION 8.4 EXTENSION; WAIVER. At any time prior to the
Closing, each of the parties hereto may (a) extend the time for the
performance of any of the obligations or acts of any other party hereto,
(b) waive any inaccuracies in the representations and warranties of the
other party contained herein or in any document delivered pursuant hereto,
(c) waive compliance with any of the agreements of the other party
contained herein or (d) waive any condition to its obligations hereunder.
Any agreement on the part of a party hereto to any such extension or waiver
shall be valid only if set forth in a written instrument signed on behalf
of such party.
ARTICLE IX
TAX MATTERS
SECTION 9.1 POST-CLOSING TAX AND ACCOUNTING MATTERS.
Following the Closing, each of Purchaser and Seller will furnish to the
other, at the other's expense, such necessary and available information and
access to the personnel of Purchaser and its Affiliates or Seller and its
Affiliates, as the case may be, as the other may reasonably request in
connection with Tax and accounting matters relating to the Acquired Assets.
Purchaser and Seller will not destroy any information which is subject to
this Section 9.1 for a period of six years after the Closing Date and
thereafter shall not destroy any such information without giving at least
60 days written notice to the other, and, if the other so requests within
60 days of receipt of such notice, Purchaser or Seller, as the case may be,
shall deliver to the other or to its order, at the other's expense, such
information intended to be destroyed.
SECTION 9.2 ALLOCATION OF CONSIDERATION. Seller and
Purchaser agree that they shall use, and shall cause their respective
Subsidiaries to use, their reasonable best efforts to enter into an
agreement (the "Allocation Agreement") as to the allocation of the Purchase
Price (as adjusted pursuant to Article II) and the Assumed Liabilities
among the Acquired Assets acquired hereunder. Purchaser shall initially
prepare a draft of the Allocation Agreement (the "Proposed Allocation") and
shall submit such Proposed Allocation to Seller within 90 days after the
Closing Date. If, within 60 days after Seller's receipt of the Proposed
Allocation, Seller shall not have objected in writing to such Proposed
Allocation, the Proposed Allocation shall become the Allocation Agreement.
In the event that Seller objects in writing within such 60 day period and
Seller and Purchaser are unable to reach an agreement, the dispute shall be
referred to a nationally recognized accounting firm mutually acceptable to
Seller and Purchaser (the "Accounting Firm") for resolution, and the
determination of the Accounting Firm shall be binding upon Seller and
Purchaser and their respective Subsidiaries and shall constitute the
Allocation Agreement, with Seller and Purchaser each bearing one-half of
the costs, fees and expenses of the Accounting Firm. Seller and Purchaser
agree to act, and to cause their respective Subsidiaries to act, in
accordance with the allocations contained in the Allocation Agreement
determined pursuant to this Section 9.2. Purchaser shall initially prepare
for delivery to Seller a completed set of Internal Revenue Service Form
8594, including all additional information and materials required to be
attached to such Form 8594 pursuant to the Treasury Regulations under
Section 1060 of the Code. Such documents and forms shall be delivered to
Seller for review no later than 60 days prior to the date any such forms
are required to be filed. For all purposes hereunder, any indemnification
payments pursuant to Article X shall be treated as an adjustment to the
Purchase Price.
ARTICLE X
INDEMNIFICATION
SECTION 10.1 BY SELLER FOR TRANSAMERICA ASSETS. (a) Subject
to the limitations contained in this Article X, Seller shall indemnify and
hold harmless Purchaser, its Affiliates, officers, directors, employees,
agents, successors and assigns (the "Purchaser Indemnified Parties") from,
and reimburse them for, any loss, cost, deficiency, demand, assessment,
expense (including all reasonable legal and expert fees and expenses),
damage (including damages to Persons, property and the environment),
liability, fine, penalty or claim (but not including consequential,
punitive or special damages) incurred by the Purchaser Indemnified Parties
with respect to any Transamerica Matter and which arises out of or results
from any breach of any representation or warranty made herein relating to
the Transamerica Assets (collectively, the "Purchaser Transamerica
Losses").
(b) Notwithstanding the foregoing, Seller shall have no
liability:
(i) to the extent of any insurance or other
recovery (such insurance or other recovery, an "Offsetting Recovery")
received by any Purchaser Indemnified Party entitled to indemnification
under Section 10.1(a) in respect of a Purchaser Transamerica Loss (provided
that the net present value of the actual increase (in the following year)
in insurance premiums which are directly attributable to any such loss (the
"Premium Recapture") is deducted from any such Offsetting Recovery for
purposes of this Section 10.1(b)(i), provided further, that the Premium
Recapture shall not exceed the amount of the Offsetting Recovery); and
(ii)to the extent that Purchaser or any Affiliate
thereof realizes a Tax Benefit which is attributable to such Purchaser
Transamerica Loss.
(c) Notwithstanding the foregoing, Seller shall have no
liability for indemnification pursuant to Section 10.1(a) unless the
aggregate amount of all Purchaser Transamerica Losses under Section 10.1(a)
for which Seller would, but for this subsection (c), be liable exceeds, on
a cumulative basis, an amount equal to four million dollars ($4,000,000).
If the condition set forth in the preceding sentence of this Section
10.1(c) is met, then Seller shall be liable to Purchaser Indemnified
Parties under Section 10.1(a) only for an amount in excess of the four
million dollars ($4,000,000) threshold amount referred to in the preceding
sentence of this Section 10.1(c). However, in no event shall Seller be
liable for any Purchaser Transamerica Losses that, when added to the
amounts that Seller has otherwise paid pursuant to Sections 10.1(a) and
10.2(a)(i) and 10.2(a)(ii), exceed sixty-eight million dollars
($68,000,000). Seller shall not be liable to pay Purchaser Transamerica
Losses more than once with respect to a Purchaser Transamerica Loss
resulting from the same facts, events or circumstances, even if, for
example, such facts, events or circumstances constitute both an Excluded
Liability and a breach of any representations and warranties for which
Seller shall or would but for this provision be obligated to pay Purchaser
Transamerica Losses hereunder, provided, however, Seller shall be liable to
pay for Purchaser Transamerica Losses that arise out of the same facts,
events or circumstances when the Purchaser Transamerica Losses resulting
from such facts, events or circumstances are not duplicative or result in
damages, costs or liabilities that were not indemnified pursuant to the
first such indemnification payment. In the event that Seller makes any
payment to Purchaser in respect of a Purchaser Transamerica Loss and such
Loss, either alone or when added to Seller Transamerica Losses and other
Purchaser Transamerica Losses exceeds six million dollars ($6,000,000), and
Seller does not within three months of such payment receive full payment or
recovery from Transamerica with respect to such aggregate Seller
Transamerica Losses and Purchaser Transamerica Losses in excess of six
million dollars ($6,000,000), Purchaser shall promptly reimburse Seller and
pay Seller 75% of the amount of such Purchaser Transamerica Loss paid by
Seller to Purchaser to the extent Transamerica did not so pay Seller in
respect of the aggregate of the Seller Transamerica Losses and Purchaser
Transamerica Losses in excess of six million dollars, provided that if
after receiving such reimbursement from Purchaser, Seller thereafter
recovers amounts from Transamerica with respect to such Purchaser
Transamerica Loss, Seller shall return such portion of such reimbursement
amount to Purchaser. Seller shall use commercially reasonable efforts to
promptly and diligently recover from Transamerica any Purchaser
Transamerica Loss and will keep Purchaser reasonably informed of such
efforts; provided, further, that Purchaser shall not be liable to so
reimburse Seller for any Seller Transamerica Losses that relate to events
arising between the Transamerica Closing Date and the Closing Date.
(d) In the event that any facts, events or circumstances
would permit (pursuant to the terms of Section 10.1(a) and 10.2(a)(i)
hereof) a Purchaser Indemnified Party to assert an indemnification claim
pursuant to Section 10.1(a) and Section 10.2(a)(i) hereof, then such
Purchaser Indemnified Party may, to the extent possible, split such
indemnification claims between Section 10.1(a) and Section 10.2(a)(i), as
applicable, and if such claim can not be so split, then Purchaser may only
assert an indemnification claim with respect to such facts, events and
circumstances pursuant to Section 10.1(a) hereof (and such Purchaser
Indemnified Party shall not assert an indemnification claim with respect to
such facts, events and circumstances pursuant to Section 10.2(a)(i)
hereof).
SECTION 10.2 BY SELLER FOR INTERPOOL ASSETS. (a) Subject to
the limitations contained in this Article X, Seller shall indemnify and
hold harmless the Purchaser Indemnified Parties from, and reimburse them
for any, loss, cost, deficiency, demand, assessment, expense (including all
reasonable legal and expert fees and expenses), damage (including damages
to Persons, property or the environment), liability, fines, penalties or
claims (but not including consequential, punitive or special damages)
incurred by the Purchaser Indemnified Parties which arises out of or
results from (collectively, the "Purchaser Interpool Losses"):
(i) any breach of any representation or warranty
made by Seller in this Agreement;
(ii)Seller's breach of or failure to perform any
of its covenants or agreements contained in or made pursuant to Sections
5.1(a)(i), 5.1(a)(iii), 5.1(b)(viii), (ix), (x) (but only with respect to
the other subsections of 5.1(a) and (b) enumerated in this clause), (xi)
and (xii) of this Agreement other than any willful breaches of such
enumerated covenants, or breaches, whether or not willful, that result from
the actions of Persons listed on Section 1.1 of the Seller's Disclosure
Schedule it being understood that Seller will promptly notify Seller's
sales personnel of the restrictions set forth in Section 5.1;
(iii)Seller's breach of or failure to perform any
of its covenants or agreements in or made pursuant to this Agreement which
are not enumerated in clause (ii) above.
(iv) any Excluded Liability;
(v) any failure to comply with the terms and
conditions of any applicable bulk sales or bulk transfer or similar laws
that may be applicable to the bulk sale or bulk transfer of the Acquired
Assets, notwithstanding Section 5.10; and
(vi)any Excluded Asset.
(b) Notwithstanding the foregoing, Seller shall have
no liability:
(i) to the extent of any Offsetting Recovery
received by a Person entitled to indemnification under Section 10.2(a) in
respect of a Purchaser Interpool Loss (provided that the Premium Recapture
is deducted from any such Offsetting Recovery for purposes of this Section
10.2(b)(i), provided further, that the Premium Recapture shall not exceed
the amount of the Offsetting Recovery); and
(ii)to the extent that Purchaser or any Affiliate
thereof realizes a Tax Benefit that is attributable to such Purchaser
Interpool Loss.
(c) Notwithstanding the foregoing, Seller shall have no
liability for indemnification pursuant to Sections 10.2(a)(i) and
10.2(a)(ii) unless the aggregate of all Purchaser Interpool Losses under
Sections 10.2(a)(i) and 10.2(a)(ii) for which Seller would, but for this
subsection (c), be liable exceeds, in the aggregate, one million dollars
($1,000,000). In calculating the one million dollar figure in the preceding
sentence, any facts, events or circumstances that result in Purchaser
Interpool Losses of less than ten thousand dollars ($10,000) shall not be
included. If the condition set forth in the second preceding sentence of
this Section 10.2(c) is met, then Seller shall be liable only for an amount
in excess of the one million dollar ($1,000,000) threshold referred to in
the second preceding sentence. However, in no event shall Seller be liable
for any Purchaser Interpool Loss pursuant to Sections 10.2(a)(i),
10.2(a)(ii) and 10.2(a)(iii) that, when added to the amounts that Seller
has otherwise paid pursuant to Sections 10.2(a)(i), 10.2(a)(ii),
10.2(a)(iii) and Section 10.1, exceeds the amount of sixty-eight million
dollars ($68,000,000). In addition, Seller shall not be liable to pay
Purchaser Interpool Losses more than once with respect to a Purchaser
Interpool Loss resulting from the same facts, events or circumstances, even
if, for example, such facts, events or circumstances constitute both an
Excluded Liability and a breach of any representations and warranties for
which Seller shall or would but for this provision be obligated to pay
Purchaser Interpool Losses hereunder, provided, however, that Seller shall
be liable to pay for Purchaser Interpool Losses that arise out of the same
facts, events or circumstances when the Purchaser Interpool Losses
resulting from such facts, events or circumstances are not duplicative or
result in damages, costs or liabilities that were not indemnified pursuant
to the first such indemnification payment.
SECTION 10.3 BY PURCHASER. (a) Subject to the limitations
contained in this Article X, Purchaser shall indemnify and hold Seller, and
its Affiliates, officers, directors, employees, agents, successors, and
assigns, and related entities from, and reimburse them for, any loss, cost
deficiency, demand, assessment, expense (including all reasonable legal and
expert fees and expenses), damage (including damages to Persons, property
and the environment), liability, fine, penalty or claim (but not including
consequential, punitive or special damages) (collectively, the "Seller
Losses") arising out of or resulting from:
(i) any breach of any representation or warranty
made by Purchaser in this Agreement;
(ii)Purchaser's breach of or failure to perform
any of its covenants or agreements contained in or made pursuant to this
Agreement;
(iii)any Assumed Liability; and
(iv)except as expressly provided elsewhere
herein, the ownership of the Acquired Assets or the assumption of the
Assumed Liabilities from and after the Closing Date.
(b) Notwithstanding the foregoing, Purchaser shall have
no liability: (1) to the extent that Seller or any Affiliate thereof
realizes a Tax Benefit that is attributable to such Seller Loss; and (2) to
the extent of any Offsetting Recovery received by a Person entitled to
indemnification under Section 10.3(a) in respect of a Seller Loss (provided
that the Premium Recapture is deducted for any Offsetting Recovery for
purposes of this Section 10.3(b), and, provided further, that the Premium
Recapture shall not exceed the amount of the Offsetting Recovery).
(c) Notwithstanding the foregoing, Purchaser shall have
no liability for indemnification pursuant to Sections 10.3(a)(i) unless the
aggregate of all Seller Losses under Sections 10.3(a)(i) for which
Purchaser would, but for this subsection (c), be liable exceeds, in the
aggregate, five million dollars ($5,000,000). If the condition set forth in
the preceding sentence of this Section 10.3(c) is met, then Purchaser shall
be liable only for an amount in excess of the five million dollar
($5,000,000) threshold referred to in the preceding sentence. However, in
no event shall Purchaser be liable for any Seller Loss pursuant to Sections
10.3(a)(i) or 10.3(a)(ii) that, when added to the amounts that Purchaser
has otherwise paid pursuant to Sections 10.3(a)(i) or 10.3(a)(ii), exceeds
the amount of sixty-eight million dollars ($68,000,000). In addition,
Purchaser shall not be liable to pay Seller Losses more than once with
respect to a Seller Loss resulting from the same facts, events or
circumstances, even if, for example, such facts, events or circumstances
constitute both an Assumed Liability and a breach of any representations
and warranties for which Purchaser shall or would but for this provision be
obligated to pay Seller Losses hereunder, provided, however, Purchaser
shall be liable to pay for Seller Losses that arise out of the same facts,
events or circumstances when the Seller Losses resulting from such facts,
events or circumstances are not duplicative or result in damages, costs or
liabilities that were not indemnified pursuant to the first such
indemnification payment.
SECTION 10.4 INDEMNIFICATION PROCEDURE. (a) Any Person
claiming indemnification pursuant to this Agreement shall promptly notify
the indemnifying party in writing of the occurrence of any event that such
party asserts is or may be an indemnifiable event pursuant to this
Agreement and shall describe in reasonable detail the facts, events and
circumstances relating to the subject matter of such claim and the amount
(if reasonably calculable) of the Indemnified Costs in connection
therewith, provided that the failure of a Person to so promptly inform the
indemnifying party shall not affect the rights or obligations of either
party (including indemnification rights or obligations) except to the
extent that such failure to give prompt notice adversely affects the other
party, including if such failure to give prompt notice adversely affects
the Seller's ability to assert a claim for indemnification pursuant to the
Transamerica Agreement. If such event involves the claim of any third
party, the indemnifying party shall be entitled to participate in and, to
the extent it shall wish, assume control over (in which case the
indemnifying party shall assume all expense with respect to) the defense,
settlement, adjustment or compromise of such claim. If the indemnified
party assumes control over the defense, settlement, adjustment or
compromise of such claim, it shall do so in good faith in a diligent
manner.
(b) The indemnified party shall have the right to employ
separate counsel in any action or claim and to participate in the defense
thereof at the expense of the indemnifying party only (i) if the retention
of such counsel has been specifically authorized by the indemnifying party
or (ii) if the counsel is retained because the indemnifying party does not
notify the indemnified party promptly in light of the facts and
circumstances after receipt of a claim notice that it elects to undertake
the defense thereof. In cases where the indemnifying party has assumed the
defense or settlement with respect to an indemnifiable event, the
indemnifying party shall be entitled to assume the defense or settlement
thereof with counsel of its own choosing, provided, however, that the
indemnified party (and its counsel) shall be entitled to continue to
participate at its own cost and expense in any such action or proceeding or
in any negotiations or proceedings to settle or otherwise eliminate any
claim for which indemnification is being sought.
(c) The indemnifying party shall obtain the prior written
approval of the indemnified party before entering into any settlement,
adjustment, or compromise of such claim or ceasing to defend against such
claim that provides for any relief other than the payment of monetary
damages with respect to the indemnified party.
(d) If the indemnifying party does not assume control
over the defense of such claim as provided in Section 10.4(a) promptly in
light of the facts and circumstances after receipt of notice thereof, the
indemnified party shall have the right to defend the claim in such manner
as it may deem appropriate and to settle, adjust, or compromise such claim
and shall not thereby waive any right to indemnification hereunder.
(e) In the event that the indemnifying party reimburses
the indemnified party for any third party claim, the indemnified party
shall remit to the indemnifying party any reimbursement that the
indemnified party subsequently receives for such third party claim.
(f) Any matter as to which a claim has been asserted by
written notice in accordance with Section 10.4(a) to the indemnifying party
that is pending or unresolved at the end of any applicable survival period
shall continue, to the extent permitted by law, to be covered by this
Article X notwithstanding any applicable statute of limitations (which the
parties hereby toll with respect to each other) or the expiration of such
survival period until such matter is finally terminated or otherwise
resolved by the parties under this Agreement or by a court of competent
jurisdiction and any amounts payable hereunder are finally determined and
paid.
(g) Notwithstanding anything to the contrary in this
Section 10.4, the indemnifying party shall continue to pay reasonable
attorneys' fees and disbursements and other costs that the indemnified
party may incur (A) relating to such indemnified party's participation in
the defense of an indemnifiable event (whether or not the indemnifying
party shall have assumed the defense of such indemnifiable event) to the
extent such participation relates to a claim or defense that the
indemnified party has that the indemnifying party does not have, or relates
to a claim or defense as to which the indemnifying party has an express
conflict of interest with the indemnified party, or (B) relating to
discovery against or testimony of such indemnified party and for
participation of such indemnified party's own counsel in such discovery and
testimony.
SECTION 10.5 SURVIVAL. The representations and warranties
made herein or in any other documentation delivered pursuant to this
Agreement relating to the Transamerica Assets as of the Transamerica
Closing Date and subject to Section 10.1(a)(i) shall survive until the
completion of the audit for the year ending December 31, 2001 but no later
than March 31, 2002 and the representations and warranties made herein or
in any other documentation delivered pursuant to this Agreement relating to
the Interpool Assets or the Transamerica Assets to the extent relating to
the period following the Transamerica Closing Date and prior to the Closing
shall survive until the eighteenth month anniversary of the Closing Date;
provided, that (a) expiration of a representation, warranty, covenant or
agreement shall not affect the obligations of a Party with respect to
claims for indemnification for which notice has been given to the
indemnifying party in accordance with Section 10.4 prior to such expiration
and (b) all covenants, agreements and indemnification matters that
contemplate or may involve actions to be taken or obligations in effect
after the Closing shall survive until the third anniversary of the Closing
Date unless otherwise provided herein or unless it is evident from the
context that such obligations should survive beyond that date; provided,
that foregoing clause (b) shall not apply to any indemnification
obligations of any Section of this Agreement; (c) the representations and
warranties set forth in Sections 3.2, 3.8, 3.9, 3.11(a) and 3.12 relating
to the Interpool Assets or the Transamerica Assets to the extent relating
to the period following the Transamerica Closing Date and prior to the
Closing shall survive until the third anniversary of the Closing Date; and
(d) all covenants to be performed on or prior to the Closing Date shall
survive for six months following the Closing Date.
SECTION 10.6 EXCLUSIVITY. The indemnification provided in
this Article X shall be the exclusive remedy for a breach of any
representation or warranty or covenant or agreement in this Agreement,
provided that no party hereto shall be deemed to have waived any right of
recourse (whether a claim under this Article X or otherwise) arising from
fraudulent conduct of any other party hereto. In addition to the foregoing,
Purchaser agrees that Seller makes no representation or warranty and no
Purchaser Indemnified Parties shall have any claim or remedy against Seller
or its Representatives, with respect to any Seller Losses relating to the
maintenance or condition of Transamerica Assets, it being understood by the
parties that the foregoing agreement is in consideration of the adjustment
provided for in Section 2.5(d) hereof.
SECTION 10.7 ENVIRONMENTAL Indemnification Matters.
Purchaser shall inform Seller promptly in writing upon its receipt of any
Third Party Environmental Claim or its obtaining knowledge (as defined for
purposes of this sentence in the immediately following sentence) of any
basis for any Third Party Environmental Claim, Requirement for Cleanup of
Hazardous Materials or other Environmental Liability subject to
indemnification under this Agreement, provided that the failure of
Purchaser to so promptly inform Seller shall not affect the rights of
Purchaser, except to the extent that such failure to give prompt notice
adversely affects the Seller. For purpose of the preceding sentence,
"Knowledge" means the actual knowledge of any employees of Purchaser or its
Subsidiaries set forth on Section 10.7 to the Purchaser Disclosure
Schedule, provided that Purchaser shall establish policies and procedures
designed to seek to inform the persons listed on Section 10.7 to the
Purchaser Disclosure Schedule of any Third Party Environmental Claim,
Requirement for Cleanup of Hazardous Materials or other Environmental
Liability subject to indemnification under this Agreement of which any
person in their organization is aware. Subject to the provisions of Section
10.4 hereof, Purchaser shall be entitled to respond to Third Party
Environmental Claims or manage and control any Cleanup of Hazardous
Materials or other Environmental Liability subject to indemnification under
this Agreement. Purchaser and Seller shall reasonably cooperate with
respect to any Third Party Environmental Claims, Cleanup of Hazardous
Materials or other matters subject to this Section 10.7. If at any time
Purchaser assumes control over a matter pursuant to this Section 10.7, then
it shall thereafter direct the communications with respect thereto and
afford Seller a reasonable opportunity to participate and shall give Seller
reasonable opportunity to comment thereon, and not unreasonably refuse to
incorporate Seller's comments. Notwithstanding any other provision herein,
Seller shall only be required to defend, indemnify, and hold harmless Buyer
to the extent that Cleanup of the Hazardous Materials is required to comply
with Environmental Law or required by a Governmental Entity under an
applicable Environmental Law and such cleanup is conducted using reasonable
cost effective methods for investigation and Cleanup. The indemnification
provided in this Article X shall be the exclusive remedy with respect to
any Third Party Environmental Claim, Cleanup obligation, or other Liability
relating to Environmental Laws under this Agreement; provided that no party
hereto shall be deemed to have waived any right of recourse (whether a
claim under this Article X or otherwise) arising from fraudulent conduct of
any party hereto. Notwithstanding the foregoing, to the extent any Third
Party Environmental Claim or Cleanup relating to the Acquired Assets is
covered by or subject to Section 11.6 of the Transamerica Agreement, such
Section 11.6 (and not this Section 10.7) shall govern such matter.
SECTION 10.8 LIMITATION ON REPRESENTATIONS AND WARRANTIES.
Except as expressly set forth in Article III and without limiting the
representations and warranties set forth in Article III, Seller makes no
representations or warranties as to the Acquired Assets or the Assumed
Liabilities, which are being transferred to Purchaser "AS IS," "WHERE IS"
and with all defects at the Closing. Purchaser has conducted its own
independent review and analysis of the Acquired Assets and the Assumed
Liabilities and acknowledges that Seller has provided Purchaser with access
to the personnel, properties, premises and books and records of Seller, its
Subsidiaries and their respective Affiliates, as the case may be, for this
purpose. In entering into this Agreement, Purchaser has relied solely upon
its own investigation and analysis and the representations and warranties
made by Seller herein, and Purchaser (i) acknowledges that, except for the
specific representations and warranties of Seller contained in Article III
hereof, none of Seller, its Subsidiaries or its or their respective
Representatives makes or has made any representation or warranty, either
express or implied, as to the accuracy or completeness of any of the
information (including any projections, estimates or other forward-looking
information) provided (including in any management presentations,
information memorandum, supplemental information or other materials or
information with respect to any of the above) or otherwise made available
to Purchaser, its Subsidiaries or its or their respective Representatives
and (ii) agrees, to the fullest extent permitted by law, that Seller, its
Subsidiaries and its and their respective Representatives shall not have
any liability or responsibility whatsoever to Purchaser or its Subsidiaries
or its or their respective Representatives on any basis (including in
contract or tort, under federal or state securities laws or otherwise)
based upon any information provided or made available, or statements made
(or any omissions therefrom), to Purchaser or its Subsidiaries or its or
their respective Representatives, including in respect of the specific
representations and warranties of Seller set forth in Article III of this
Agreement, except as and only to the extent expressly set forth in Article
III hereof with respect to such representations and warranties and subject
to the limitations and restrictions contained in this Agreement. The
parties agree and acknowledge that this Section 10.8 is not intended to
modify the allocation of (i) Acquired Assets and Excluded Assets negotiated
between the parties and expressly set forth in Sections 2.1 and 2.2 hereof,
or (ii) Assumed Liabilities and Excluded Liabilities negotiated between the
parties and expressly set forth in Sections 2.3 and 2.4 hereof.
SECTION 10.9 NO RIGHT OF OFFSET. The parties hereto agree
and acknowledge that no party shall have any right of offset or any right
of setoff for any amounts owing or due to or claimed to be owing or due to
the other party.
ARTICLE XI
MISCELLANEOUS
SECTION 11.1 AMENDMENT AND MODIFICATION; WAIVER OF
PROVISIONS. This Agreement may be amended, modified or waived only by a
written instrument executed by all of the parties hereto. The failure of
any party at any time or times to require performance of any provision of
this Agreement shall in no manner affect the right of such party at a later
date to enforce the same. No waiver by any party of any condition or the
breach of any provision, terms, covenant, representation or warranty
contained in this Agreement in any one or more instances shall be deemed to
be or construed as a further or continuing waiver of any such condition or
of the breach of any other provision, term, covenant, representation or
warranty of this Agreement.
SECTION 11.2 EXPENSES. The parties agree that fees and
out-of-pocket expenses shall be paid as follows:
(a) Fees and disbursements of counsel, consultants,
accountants, brokers, finders, and financial advisors shall be paid by the
party retaining such Persons;
(b) Each party shall bear its own expenses incurred with
respect to filings under the HSR Act and obtaining all required consents,
authorizations, orders or approvals of, filings or registrations with, and
notices to, Governmental Authorities; provided that the Purchaser shall pay
the filing fee under the HSR Act;
(c) Purchaser shall be responsible for any and all sales
or transfer Taxes arising from the transfer of the Acquired Assets to
Purchaser or assumption of the Assumed Liabilities by Purchaser; and
(d) All other fees and out-of-pocket expenses incurred in
connection with the transactions contemplated hereby shall be paid by the
party incurring such expenses.
SECTION 11.3 SUCCESSORS AND ASSIGNS; ASSIGNMENTS. All terms
and provisions of this Agreement shall be binding upon and inure to the
benefit of the parties hereto and their respective transferees, successors
and assigns. No party hereto may assign any of its rights or delegate any
of its obligations hereunder without the prior written consent of the other
parties, except Purchaser may assign its rights, but not its obligations,
hereunder to its financing sources and may assign certain or all of its
rights and obligations (provided it continues to fully and unconditionally
guarantee such obligations) to a Subsidiary or other entity controlled by
Purchaser in connection with obtaining financing for the transactions
contemplated hereby, and any such attempted assignment or delegation
without such consent shall be null and void.
SECTION 11.4 NO THIRD PARTIES BENEFITTED. This Agreement is
made and entered into for the protection and benefit of the parties hereto
and their permitted successors and assigns, and no other Person shall be a
direct or indirect beneficiary of or have any direct or indirect cause of
action or claim in connection with this Agreement or any of the documents
executed in connection herewith.
SECTION 11.5 NOTICES. All notices, requests, demands and
other communications hereunder shall be in writing and shall be delivered
personally, by courier, by telecopy or by mail (regular, certified or
registered), postage prepaid, addressed as follows:
If to Seller:
Interpool, Inc.
000 Xxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxx Xxxxxxxxx
(Telecopy: (000) 000-0000)
with a copy (which shall not constitute notice) to:
Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP
Xxxx Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention:Xxxx X. Xxxxxxx, Esq.
and
Xxxxxxx X. Xxxxxxxx, Esq.
(Telecopy: (000) 000-0000)
If to Purchaser:
TIP International Services
000 X. Xxxxxxxxx Xxxxxx
Xxxxx, XX 00000-0000
Attention: Xxxxx Robo
(Telecopy: (000) 000-0000)
with a copy (which shall not constitute notice) to:
TIP International Services
000 X. Xxxxxxxxx Xxxxxx
Xxxxx, XX 00000-0000
Attention: Xxxx Xxxxxxx, Esq.
(Telecopy: (000) 000-0000)
and
Weil, Gotshal & Xxxxxx LLP
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Attention: Xxxxxxx X. Xxxxx, Esq.
(Telecopy: (000) 000-0000)
or to such other address as a party may from time to time designate in
writing in accordance with this Section 11.5. Each notice or other
communication given to any party hereto in accordance with the provisions
of this Agreement shall be deemed to have been received (a) on the Business
Day it is sent, if sent by personal delivery, or (b) on the first Business
Day after sending, if sent by overnight delivery, properly addressed and
prepaid or (c) upon receipt, if sent by mail (regular, certified or
registered); provided, however, that notice of change of address shall be
effective only upon receipt. The parties agree that delivery of process or
other papers in connection with any such action or proceeding in the manner
provided in this Section 11.5, or in such other manner as may be permitted
by law, shall be valid and sufficient service thereof.
SECTION 11.6 LAW GOVERNING. This Agreement shall be governed
by, construed and enforced in accordance with the laws of the State of New
York, without giving effect to the choice of law provisions thereof.
SECTION 11.7 COUNTERPARTS. This Agreement may be executed
simultaneously in one or more counterparts, each of which shall be deemed
an original, but all of which shall constitute but one and the same
instrument.
SECTION 11.8 ENTIRE AGREEMENT. This Agreement and the
schedules, annexes, and exhibits hereto, and the letter agreements entered
into simultaneously herewith and the Confidentiality Agreement constitute
the entire Agreement among the parties and supersede and cancel any and all
prior agreements, written or oral, among them relating to the subject
matter hereof and supersede and cancel all prior agreements, negotiations,
correspondence, undertakings, understandings and communications of the
parties, oral and written, with respect to the subject matter hereof.
SECTION 11.9 CHOICE OF FORUM; WAIVER OF JURY TRIAL. Any
judicial proceeding brought against any of the parties hereto with respect
to his Agreement shall be brought in any court of competent jurisdiction in
the Southern District of New York irrespective of where such party may be
located at the time of such proceeding, and by the execution and delivery
of this Agreement, each of the parties to this Agreement hereby consents to
the exclusive jurisdiction of any such court and waives any defense or
opposition to such jurisdiction. To the extent permitted by Applicable Law,
the parties hereby irrevocably waive any and all right to trial by jury in
any legal proceeding arising out of or relating to this Agreement or the
transactions contemplated hereby.
SECTION 11.10 HEADINGS. The article, section, paragraph and
other headings contained in this Agreement are inserted for convenience of
reference only and shall not affect in any way the meaning or
interpretation of this Agreement.
SECTION 11.11 SEVERABILITY. This Agreement shall be deemed
severable; the invalidity or unenforceability of any term or provision of
this Agreement shall not affect the validity or enforceability of this
Agreement or of any other term hereof, which shall remain in full force and
effect. If it is ever held that any restriction hereunder is too broad to
permit enforcement of such restriction to its fullest extent, each party
agrees that such restriction may be enforced to the maximum extent
permitted by law, and each party hereby consents and agrees that such scope
may be judicially modified accordingly in any proceeding brought to enforce
such restriction.
IN WITNESS WHEREOF, the parties have caused this Asset Purchase
Agreement to be duly executed by their duly authorized officers, as of the
day and year first above written.
INTERPOOL, INC.
By: /s/ Xxxxx X. Xxxxxxxxx
-------------------------
Name: Xxxxx X. Xxxxxxxxx
Title:
TRANSPORT INTERNATIONAL POOL, INC.
By: /s/ Xxxxx X. Robo
-------------------------
Name: Xxxxx X. Robo
Title:
Solely for purposes of the last
sentence of Section 5.4(b) of the
Agreement:
GENERAL ELECTRIC CAPITAL
CORPORATION
By: /s/ Xxxxx X. Robo
-------------------------
Name: Xxxxx X. Robo
Title:
