PURCHASE AND SALE AGREEMENT
BY AND BETWEEN
NUS ACQUISITION CORP.
A DELAWARE CORPORATION
AS PURCHASER
AND
TETRA TECH, INC.
AS GUARANTOR
AND
▇▇▇▇▇ & ROOT, INC.,
A DELAWARE CORPORATION
AND
HALLIBURTON NUS CORPORATION,
A DELAWARE CORPORATION
AS THE SELLING ENTITIES
DATED AS OF THE 18TH DAY OF OCTOBER, 1997.
TABLE OF CONTENTS
PURCHASE AND SALE AGREEMENT........................................ 1
R E C I T A L...................................................... 1
ARTICLE I
DEFINITIONS........................................................ 1
ARTICLE II
PURCHASE AND SALE.................................................. 5
2.01 SALE AND PURCHASE OF ASSETS.............................. 5
(a) ASSETS TRANSFERRED................................. 5
(1) FIXED ASSETS.................................. 5
(2) INVENTORY..................................... 6
(3) ASSIGNED CONTRACTS............................ 6
(4) INTELLECTUAL PROPERTY......................... 6
(5) BOOKS AND RECORDS............................. 6
(6) MOTOR VEHICLES................................ 6
(7) PERMITS AND LICENSES.......................... 6
(8) ACCOUNTS RECEIVABLE........................... 6
(9) NAME "NUS".................................... 7
(b) ASSETS NOT TRANSFERRED............................. 7
(1) CASH, CASH EQUIVALENTS AND EMPLOYEE ACCOUNTS
RECEIVABLE.................................... 7
(2) REFUND CLAIMS................................. 7
(3) THIRD PARTY CLAIMS............................ 7
(4) INSURANCE..................................... 7
(5) UNRELATED CONFIDENTIAL INFORMATION AND CERTAIN
PROCESSES..................................... 7
(6) SELLING ENTITIES' MARKS AND PROPRIETARY
SYSTEMS AND PROCEDURES........................ 7
(7) UNRELATED ASSETS.............................. 8
(8) EXCLUDED PERSONAL PROPERTY.................... 8
(9) CONTRACTS NOT ASSIGNED........................ 8
(10) RETAINED ACCOUNTS RECEIVABLE.................. 8
(11) AFFILIATE ACCOUNTS............................ 8
(12) SELLING ENTITIES' EMPLOYEE BENEFIT PLANS...... 8
(13) RETAINED PATENTS.............................. 8
(c) ASSETS FREE OF LIENS............................... 9
2.02 INSTRUMENTS OF CONVEYANCE AND TRANSFER................... 9
2.03 NONASSIGNABLE CONTRACTS.................................. 9
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ARTICLE III
CLOSING, PURCHASE PRICE,
ASSUMPTION OF LIABILITIES.......................................... 9
3.01 CLOSING.................................................. 9
3.02 CONSIDERATION............................................ 9
3.03 PURCHASE PRICE AND PAYMENT THEREOF....................... 10
(a) PURCHASE PRICE AND PAYMENT OF ESTIMATED PURCHASE
PRICE.............................................. 10
(b) DETERMINATION OF PURCHASE PRICE.................... 10
(c) ADJUSTMENT AND SETTLEMENT OF PURCHASE PRICE........ 11
(d) ALLOCATION OF PURCHASE PRICE....................... 11
(e) ACCOUNTING OBJECTIONS.............................. 12
3.04 ASSUMPTION OF LIABILITIES................................ 12
3.05 EXCLUDED LIABILITIES..................................... 13
3.06 COLLECTION AND REPURCHASE OF ACCOUNTS RECEIVABLE......... 13
(a) COLLECTION OF THE SELLING ENTITIES' ACCOUNTS
RECEIVABLE......................................... 13
(b) REPURCHASE OF ACCOUNTS RECEIVABLE.................. 14
(c) REMEDY FOR UNCOLLECTED RECEIVABLES................. 14
ARTICLE IV
PURCHASER'S REPRESENTATIONS AND WARRANTIES......................... 14
4.01 ORGANIZATION AND GOOD STANDING........................... 14
4.02 AUTHORIZATION AND VALIDITY............................... 15
4.03 NO VIOLATION............................................. 15
4.04 LITIGATION............................................... 15
4.05 CONSENTS................................................. 15
4.06 FINDERS' FEES............................................ 15
4.07 CONDITION OF ASSETS...................................... 16
4.08 DISCLOSURE............................................... 16
ARTICLE V
SELLING ENTITIES' REPRESENTATIONS AND WARRANTIES................... 16
5.01 ORGANIZATION AND GOOD STANDING........................... 16
5.02 AUTHORIZATION AND VALIDITY............................... 16
5.03 EMPLOYEE BENEFIT PLANS................................... 17
5.04 ABSENCE OF CERTAIN CHANGES............................... 17
5.05 TITLE.................................................... 17
5.06 COMMITMENTS.............................................. 17
5.07 INTELLECTUAL PROPERTY.................................... 18
5.08 NO VIOLATION............................................. 18
5.09 TAXES.................................................... 18
5.10 GOVERNMENT APPROVALS..................................... 18
5.11 LABOR RELATIONS.......................................... 19
5.12 COMPLIANCE WITH LAWS..................................... 19
5.13 LITIGATION............................................... 19
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5.14 EMPLOYEES................................................ 19
5.15 ASSIGNED CONTRACTS....................................... 20
5.16 ACCOUNTS RECEIVABLE...................................... 20
5.17 FINDERS' FEES............................................ 21
5.18 FINANCIAL STATEMENTS..................................... 21
5.19 LICENSES AND PERMITS..................................... 21
5.20 [THIS SECTION INTENTIONALLY OMITTED]..................... 22
5.21 TRANSACTIONS WITH AFFILIATES............................. 22
5.22 DISCLOSURE............................................... 22
5.23 NO OTHER ASSETS NECESSARY TO THE BUSINESS................ 22
5.24 CONDITION OF ASSETS...................................... 22
ARTICLE VI
PURCHASER'S COVENANTS.............................................. 23
6.01 RETENTION OF RECORDS, COOPERATION AND ACCESS............. 23
6.02 TIMELY PAYMENT AND PERFORMANCE OF ASSUMED LIABILITIES.... 23
6.03 SELLING ENTITIES' NAMES.................................. 23
6.04 WARRANTY WORK............................................ 24
6.05 EMPLOYMENT BY PURCHASER.................................. 24
6.06 NOTICE OF CHANGE......................................... 24
6.07 HSR FILING............................................... 24
6.08 INTENDED USE............................................. 25
6.09 INSURANCE................................................ 25
(a) COMPREHENSIVE GENERAL LIABILITY INSURANCE.......... 25
(b) FIRE AND EXTENDED COVERAGE INSURANCE............... 25
(c) STATUTORY WORKER'S COMPENSATION COVERAGE........... 25
(d) EMPLOYER'S LIABILITY INSURANCE..................... 25
6.10 USE OF LEASED REAL PROPERTY.............................. 26
(a) HAZARDOUS MATERIALS................................ 26
6.11 ENVIRONMENTAL STUDY...................................... 27
ARTICLE VII
SELLING ENTITIES' COVENANTS........................................ 28
7.01 BUSINESS OPERATIONS...................................... 28
7.02 ACCESS................................................... 28
7.03 APPROVALS OF THIRD PARTIES............................... 28
7.04 EMPLOYEE COMPENSATION AND BENEFIT MATTERS................ 28
7.05 CONTRACTS................................................ 28
7.06 CAPITAL ASSETS; PAYMENTS OF LIABILITIES.................. 29
7.07 MORTGAGES, LIENS......................................... 29
7.08 NOTICE OF CHANGE......................................... 29
7.09 HSR FILING............................................... 29
7.10 NO TRANSACTIONS.......................................... 29
7.11 NONCOMPETITION........................................... 29
7.12 ENVIRONMENTAL STUDY...................................... 30
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ARTICLE VIII
PURCHASER'S CONDITIONS PRECEDENT TO CLOSING........................ 30
8.01 REPRESENTATIONS AND WARRANTIES........................... 30
8.02 COVENANTS................................................ 30
8.03 PROCEEDINGS.............................................. 31
8.04 NO MATERIAL ADVERSE CHANGE............................... 31
8.05 ▇▇▇▇ OF SALE............................................. 31
8.06 LEASE ASSIGNMENT AGREEMENT............................... 31
8.07 TRANSITION SERVICES AGREEMENT............................ 31
8.08 DELIVERY OF OTHER DOCUMENTS.............................. 31
8.09 CERTIFICATE.............................................. 31
ARTICLE IX
SELLING ENTITIES' CONDITIONS PRECEDENT TO CLOSING.................. 31
9.01 REPRESENTATIONS AND WARRANTIES........................... 31
9.02 COVENANTS................................................ 32
9.03 PROCEEDINGS.............................................. 32
9.04 PURCHASE PRICE........................................... 32
9.05 ▇▇▇▇ OF SALE............................................. 32
9.06 LEASE ASSIGNMENT AGREEMENT............................... 32
9.07 TRANSITION SERVICES AGREEMENT............................ 32
9.08 DELIVERY OF OTHER DOCUMENTS.............................. 32
9.09 CERTIFICATE.............................................. 32
ARTICLE X
LIABILITY AND INDEMNIFICATION...................................... 32
10.01 SELLING ENTITIES' LIABILITY AND INDEMNITY................ 32
10.02 PURCHASER'S LIABILITY AND INDEMNITY...................... 33
10.03 BASKET................................................... 33
10.04 NON-BASKET ITEMS......................................... 33
10.05 CAP...................................................... 33
10.06 RESPONSIBILITY FOR BREACH OF AGREEMENT................... 33
10.07 CONDITIONS OF INDEMNIFICATION............................ 33
10.08 REMEDIES EXCLUSIVE....................................... 34
ARTICLE XI
MISCELLANEOUS...................................................... 35
11.01 AMENDMENT................................................ 35
11.02 ASSIGNMENT............................................... 35
11.03 NOTICE................................................... 35
11.04 PRE-CLOSING CONFIDENTIALITY.............................. 36
11.05 POST-CLOSING CONFIDENTIALITY............................. 36
11.06 ENTIRE AGREEMENT......................................... 36
11.07 COSTS, EXPENSES AND LEGAL FEES........................... 36
11.08 SEVERABILITY............................................. 37
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11.09 WAIVER................................................... 37
11.10 GOVERNING LAW............................................ 37
11.11 CONSENT TO JURISDICTION AND SERVICE OF PROCESS........... 37
11.12 CAPTIONS................................................. 37
11.13 COUNTERPARTS............................................. 37
11.14 ADDITIONAL AGREEMENTS.................................... 37
11.15 BULK SALES COMPLIANCE.................................... 38
11.16 SURVIVAL OF REPRESENTATIONS, WARRANTIES AND COVENANTS.... 38
11.17 RISK OF LOSS............................................. 38
11.18 PARENT GUARANTY.......................................... 38
ARTICLE XII
TERMINATION........................................................ 39
12.01 TERMINATION RIGHTS....................................... 39
12.02 PERFORMANCE EXCUSED...................................... 39
12.03 CONTINUING OBLIGATIONS................................... 40
Exhibit A - ▇▇▇▇ OF SALE, ASSIGNMENT AND ASSUMPTION AGREEMENT
Exhibit B - CONFIDENTIALITY AGREEMENT
Exhibit C - LEASE ASSIGNMENT AGREEMENT
Exhibit D - FINAL CLOSING BALANCE SHEET FORMAT
Exhibit E - ADJUSTED JUNE BALANCE SHEET
Exhibit F - FINANCIAL STATEMENTS
Exhibit G - TRANSITION SERVICES AGREEMENT
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PURCHASE AND SALE AGREEMENT
THIS PURCHASE AND SALE AGREEMENT, dated as of October 18, 1997,
("AGREEMENT") is by and between ▇▇▇▇▇ & Root, Inc., a Delaware corporation
("SELLER"), Halliburton NUS Corporation, a Delaware corporation ("SELLER'S
AFFILIATE"), and NUS Acquisition Corp., a Delaware corporation ("PURCHASER")
and Tetra Tech, Inc. ("PARENT").
R E C I T A L
WHEREAS, Seller and Seller's Affiliate (sometimes referred to collectively
as the "Selling Entities") desire to sell, and Purchaser desires to purchase,
as an ongoing concern, the assets owned by the Selling Entities or which the
Selling Entities have a legal right to use and which are used exclusively by
the Selling Entities in connection with their business of providing consulting,
engineering and design services with respect to contamination of air, water and
soil and environmental remediation services (the "BUSINESS");
WHEREAS, Parent is executing this Agreement to guaranty the obligations of
Purchaser pursuant to this Agreement.
NOW, THEREFORE, in consideration of the mutual representations, warranties
and covenants herein contained, and on the terms and subject to the conditions
herein set forth, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
As used herein, the following definitions apply:
"AA" shall mean ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP.
"ACCOUNTING OBJECTIONS" shall have the meaning set forth in Section
3.03(e).
"ADJUSTED JUNE BALANCE SHEET" shall have the meaning set forth in Section
3.03(b)(i).
"ADJUSTMENT" shall have the meaning set forth in Section 3.03(c).
"AFFILIATE" shall, with respect to any Person, mean any other Person that
controls, is controlled by or is under common control with the former.
"AFFILIATE ACCOUNTS" shall have the meaning set forth in Section
2.01(b)(11).
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"AGREEMENT" shall have the meaning set forth in the first paragraph of
this document.
"ASSETS" shall have the meaning set forth in Section 2.01(a).
"ASSIGNED CONTRACTS" shall have the meaning set forth in Section
2.01(a)(3).
"ASSUMED LIABILITIES" shall have the meaning set forth in Section 3.04.
"BASKET" shall have the meaning set forth in Section 10.03.
"▇▇▇▇ OF SALE, ASSIGNMENT AND ASSUMPTION AGREEMENT" shall mean the ▇▇▇▇ of
Sale, Assignment and Assumption Agreement in substantially the form of
EXHIBIT A hereto.
"BUSINESS" shall have the meaning set forth in the Recital above.
"CERCLA" shall have the meaning set forth in Section 6.10(a)(i)(2).
"CESQG" shall mean a conditionally exempt small quantity generator.
"CLOSING" and "CLOSING DATE" shall have the meanings set forth in Section
3.01.
"CLOSING DATE RECEIVABLES" shall have the meaning set forth in Section
3.06(a).
"CLOSING NET ASSETS" shall have the meaning set forth in Section
3.03(b)(i).
"CODE" shall have the meaning set forth in Section 3.03(d).
"COLLECTION PERIOD" shall have the meaning set forth in Section 3.06(a).
"CONFIDENTIALITY AGREEMENT" shall mean the Confidentiality Agreement
referred to in Section 11.04 and attached hereto as EXHIBIT B.
"CUSTOMER" shall have the meaning set forth in Section 3.06(a).
"DAMAGES" shall have the meaning set forth in Section 10.01.
"DT" shall mean Deloitte & Touche L.L.P.
"EMPLOYEE BENEFIT PLANS" shall mean all employee benefit plans, as defined
in Section 3(3) of the Employee Retirement Income Security Act of 1974
("ERISA") and all other profit sharing, deferred compensation, bonus,
stock option, stock purchase, stock bonus, vacation pay, holiday pay,
severance, dependent care assistance, excess benefit, incentive
compensation, salary continuation, medical, life or other insurance,
supplemental
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unemployment and other compensation or employee benefit plans, programs,
agreements or arrangements, whether funded or unfunded, maintained or
contributed to by the Selling Entities or any Affiliate of the Selling
Entities for the benefit of its employees (or former employees) and/or
their beneficiaries.
"EMPLOYEES" shall have the meaning set forth in Section 6.05.
"ESTIMATED PURCHASE PRICE" shall have the meaning set forth in Section
3.03 (a).
"EXCLUDED ASSETS" shall have the meaning set forth in Section 2.01(b).
"EXCLUDED LIABILITIES" shall have the meaning set forth in Section 3.05.
"FTSCA" shall have the meaning set forth in Section 6.10(a)(i)(4).
"FINAL CLOSING BALANCE SHEET" shall have the meaning set forth in Section
3.03(b)(i).
"FINANCIAL STATEMENTS" shall have the meaning set forth in Section 5.18.
"FIXED ASSETS" shall have the meaning set forth in Section 2.01(a)(1).
"GAAP" shall have the meaning set forth in Section 3.03 (b)(i).
"HAZARDOUS MATERIALS" shall have the meaning set forth in Section
6.10(a)(i).
"HAZARDOUS MATERIALS CONTAMINATION" shall have the meaning set forth in
Section 6.10(a)(ii).
"HSR ACT" shall have the meaning set forth in Section 6.07.
"INDEMNIFIED PARTY" shall have the meaning set forth in Section 10.07.
"INDEMNIFYING PARTY" shall have the meaning set forth in Section 10.07.
"INTELLECTUAL PROPERTY" shall have the meaning set forth in Section
2.01(a)(4).
"INVENTORY" shall have the meaning set forth in Section 2.01(a)(2).
"JUNE 30 NET ASSETS" shall have the meaning set forth in Section
3.03(b)(i).
"LAWS" shall mean all laws, and the rules and regulations promulgated
thereunder, of any jurisdiction applicable to the Business.
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"LEASE ASSIGNMENT AGREEMENT" shall mean the Lease Assignment Agreement in
substantially the form of EXHIBIT C hereto.
"LEASED REAL PROPERTY" shall mean the real property leased by the Selling
Entities, as described in Schedule 2.01(a)(3) of the Selling Entities'
Disclosure Letter, to be assigned to the Purchaser.
"PARENT" shall mean Tetra Tech, Inc., a Delaware corporation.
"PERMITTED LIENS" shall mean (i) taxes not yet due and payable, (ii)
contractual and statutory liens of landlords, warehouses, mechanics and
materialmen and other like liens which secure bills for services or
materials not yet due and payable and which arose in the ordinary course
of business, (iii) other encumbrances, easements, and defects or
irregularities in title which do not, individually or in the aggregate,
materially detract from the value or interfere with the use of the
properties affected thereby, as presently used, and (iv) those liens
described in Schedule 1 of the Selling Entities' Disclosure Letter.
"PERSON" shall mean an individual, partnership, limited liability company,
corporation, joint stock company, trust, estate, joint venture,
association or unincorporated organization, or any other from of business
or professional entity, but shall not include a governmental entity.
"PRELIMINARY CLOSING BALANCE SHEET" shall have the meaning set forth in
Section 3.03(b)(ii).
"PURCHASER" shall mean NUS Acquisition Corp., a Delaware corporation.
"PURCHASE PRICE" shall have the meaning set forth in Section 3.03(a).
"PURCHASER'S DISCLOSURE LETTER" shall mean a letter of even date herewith
delivered by the Purchaser to the Selling Entities with the execution of
this Agreement, which, among other things, shall identify exceptions to
the Purchaser's representations and warranties contained in Article IV.
"RCRA" shall have the meaning set forth in Section 6.10(a)(i)(1).
"REMEDIAL WORK" shall have the meaning set forth in Section 6.10(a)(iii).
"RETAINED ACCOUNTS RECEIVABLE" shall have the meaning set forth in Section
2.01(b)(10).
"REVIEW PERIOD" shall have the meaning set forth in Section 3.03(b)(ii).
"SELLER" shall mean ▇▇▇▇▇ & Root, Inc., a Delaware corporation.
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"SELLER'S AFFILIATE" shall mean Halliburton NUS Corporation, a Delaware
corporation.
"SELLING ENTITIES" shall mean ▇▇▇▇▇ & Root, Inc. and Halliburton NUS
Corporation.
"SELLING ENTITIES' DISCLOSURE LETTER" shall mean a letter of even date
herewith delivered by the Selling Entities to the Purchaser with the
execution of this Agreement, which, among other things, shall identify (i)
the Assets transferred by the Selling Entities, (ii) the Excluded Assets
retained by the Selling Entities, and (iii) the exceptions to the Selling
Entities' representations and warranties contained in Article V.
"SELLING ENTITIES' EMPLOYEE BENEFIT PLANS" shall have the meaning set
forth in Section 2.01(b)(13).
"SELLING ENTITIES' MARKS" shall have the meaning set forth in Section
2.01(b)(6).
"TRANSITION SERVICES AGREEMENT" shall mean the Transition Services
Agreement in the form of Exhibit G hereto.
"UNCOLLECTED RECEIVABLES" shall have the meaning set forth in Section
3.06(b).
"WARRANTY WORK" shall have the meaning set forth in Section 6.04.
ARTICLE II
PURCHASE AND SALE
2.01 SALE AND PURCHASE OF ASSETS.
(a) ASSETS TRANSFERRED. Subject to and upon the terms and
conditions contained herein, at the Closing, the Selling Entities shall sell,
transfer, assign, convey and deliver to Purchaser, and Purchaser shall
purchase, accept and acquire from the Selling Entities, all of the Selling
Entities' right, title and interest in and to the properties, assets and rights
of every kind and description whether personal, tangible or mixed, whether
accrued, contingent or otherwise exclusively related to or exclusively used or
held for use in connection with the Business (other than Excluded Assets),
including all assets that may have been acquired by the Selling Entities for
use exclusively in connection with the Business between the date hereof and the
Closing Date (collectively and individually, the "ASSETS"), except for any such
assets which may be disposed of, or sold or consumed since the date hereof in
the ordinary course of business. The Assets shall include, without limitation,
all of those items in the following categories used exclusively in connection
with the Business, but shall not include the Excluded Assets:
(1) FIXED ASSETS. All tangible personal property,
including, without limitation, fixtures, machinery, equipment, tools
and supplies listed in Schedule 2.01(a)(1) of the Selling Entities'
Disclosure Letter (the "FIXED ASSETS").
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(2) INVENTORY. All inventory of spare parts,
replacements, component parts and supplies the latest available lists
of which are set forth in Schedule 2.01(a)(2) of the Selling
Entities' Disclosure Letter (the "INVENTORY").
(3) ASSIGNED CONTRACTS. All rights under the contracts,
agreements, leases, sales orders, purchase orders, and other
arrangements and commitments listed in Schedule 2.01(a)(3) of the
Selling Entities' Disclosure Letter ("ASSIGNED CONTRACTS"), except
for such contracts, agreements, leases, sales orders, purchase orders
and other arrangements and commitments which are not assignable and
except for those contracts, agreements and commitments which are
listed in Schedule 2.01(b)(9) of the Selling Entities' Disclosure
Letter as Excluded Assets.
(4) INTELLECTUAL PROPERTY. All of the Selling Entities'
right, title and interest in and to, including licenses held by the
Selling Entities under which the Selling Entities have the right to
use or sublicense, all foreign and domestic patents, patent
applications, trademarks and service marks (common law and
registered), all trademark and service ▇▇▇▇ applications, trade
names, copyrights, copyright registrations, copyright applications,
proprietary and technical information, trade secrets, processes and
know-how, including, without limitation, all engineering drawings,
laboratory books, notebooks, and journals and quality control manuals
used exclusively in the Business (collectively, "INTELLECTUAL
PROPERTY"), except for such Intellectual Property which comes within
the description of Excluded Assets.
(5) BOOKS AND RECORDS. Originals or copies of all books
and records (other than personnel records) and all files, including
without limitation, documents, papers, agreements, drawings, designs,
plans, methods, engineering and manufacturing specifications,
formulas, procedures, computer programs and customer lists which
relate exclusively to the Assets or are used primarily in connection
with the Assets or the Business, but excluding those related
exclusively to the Excluded Assets.
(6) MOTOR VEHICLES. All motor vehicles owned by the
Selling Entities, listed in Schedule 2.01(a)(6)(i) of the Selling
Entities' Disclosure Letter and all motor vehicles leased by the
Selling Entities, listed in Schedule 2.01(a)(6)(ii) of the Selling
Entities' Disclosure Letter.
(7) PERMITS AND LICENSES. All transferable business
licenses, permits, and equivalent documents, which relate exclusively
to the operations of the Business listed in Schedule 2.01(a)(7) of
the Selling Entities' Disclosure Letter.
(8) ACCOUNTS RECEIVABLE. All accounts receivable
(excluding employee accounts receivable retained by the Selling
Entities pursuant to Section 2.01(b)(1)
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and Retained Accounts Receivable retained by the Selling
Entities pursuant to Section 2.01(b)(10)) and all sums
due for services performed or equipment provided by the
Selling Entities prior to the Closing including unbilled
receivables as of the Closing Date.
(9) NAME "NUS". Seller's Affiliate's right, title,
interest in and use of the name or trade name "NUS" and all goodwill
associated with the name, provided that Purchaser may not use the
names "Halliburton" and "▇▇▇▇▇ & Root" in connection therewith or
represent any relationship whatsoever with the name "Halliburton"
and/or "▇▇▇▇▇ & Root".
(b) ASSETS NOT TRANSFERRED. Notwithstanding anything to the
contrary contained herein, the following assets and properties of the Selling
Entities, none of which are reflected on the Adjusted June Balance Sheet, are
specifically excluded from the Assets and shall be retained by the Selling
Entities ("EXCLUDED ASSETS"):
(1) CASH, CASH EQUIVALENTS AND EMPLOYEE ACCOUNTS
RECEIVABLE. All cash on hand and cash equivalents, including,
without limitation, bank accounts and temporary cash investments and
all accounts receivable due from any employees of the Selling
Entities.
(2) REFUND CLAIMS. All claims of the Selling Entities for
refunds of taxes and other governmental charges for periods ending on
or prior to the Closing Date and the benefit, if any, of net
operating loss carry-forwards or carry-backs of the Selling Entities.
(3) THIRD PARTY CLAIMS. All claims or rights of the
Selling Entities, if any, against third parties based on facts or
events occurring prior to the Closing Date and which are not
reflected on the Final Closing Balance Sheet.
(4) INSURANCE. All insurance policies and rights
thereunder, including rights to any cancellation value on the Closing
Date.
(5) UNRELATED CONFIDENTIAL INFORMATION AND CERTAIN
PROCESSES. All proprietary or confidential business or technical
information, intellectual property, records and policies which relate
to the Selling Entities or their other lines of business and are not
used exclusively in the Business; and those items listed in Schedule
2.01(b)(5) of the Selling Entities' Disclosure Letter.
(6) SELLING ENTITIES' MARKS AND PROPRIETARY SYSTEMS AND
PROCEDURES. Other than as specifically provided in Section
2.01(a)(9), all marks of the Selling Entities or the Selling
Entities' Affiliates, including, without limitation, any and all
trademarks or service marks, trade names, slogans or other like
property relating to or including the names Halliburton Company,
▇▇▇▇▇ & Root, Inc. or
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Halliburton NUS Corporation; the marks Halliburton, ▇▇▇▇▇
& Root, ▇▇▇▇▇ & Root Environmental, Halliburton NUS
Corporation, HNUS, Halliburton NUS or Halliburton NUS
Environmental Corporation, or any derivatives or
variations thereof; the Halliburton Company, ▇▇▇▇▇ &
Root, Inc. or Halliburton NUS Corporation logos, or any
derivatives thereof ("SELLING ENTITIES' MARKS"), and the
Selling Entities' proprietary computer programs or other
software not used exclusively in the Business.
(7) UNRELATED ASSETS. All assets of the Selling Entities
not exclusively used in connection with the Business, including,
without limitation, assets used by the Selling Entities primarily in
their other businesses, whether or not used for the benefit of the
Business and those assets listed in Schedule 2.01(b)(7) of the
Selling Entities' Disclosure Letter.
(8) EXCLUDED PERSONAL PROPERTY. The tangible personal
property, equipment, vehicles and inventory listed in Schedule
2.01(b)(8) of the Selling Entities' Disclosure Letter.
(9) CONTRACTS NOT ASSIGNED. Those agreements, commitments
and other contracts listed in Schedule 2.01(b)(9) of the Selling
Entities' Disclosure Letter.
(10) RETAINED ACCOUNTS RECEIVABLE. Underground storage
tank accounts receivable, including those listed on Schedule
2.01(b)(10) of the Selling Entities' Disclosure Letter, government
rate adjustment accounts receivable, accounts receivable which have
been written off the books of the Selling Entities and all other
accounts receivable retained by the Selling Entities, and any
mortgages, deeds of trust, mechanics and materialmen liens, security
interests, pledges, and any other lien or charge of any type in favor
of the Selling Entities and securing the payment of such accounts
receivable, all of which are listed in Schedule 2.01(b)(10) of the
Selling Entities' Disclosure Letter ("RETAINED ACCOUNTS RECEIVABLE").
(11) AFFILIATE ACCOUNTS. All intercompany accounts among
Seller, Seller's Affiliate and their Affiliates.
(12) SELLING ENTITIES' EMPLOYEE BENEFIT PLANS. All assets
related to any Employer Benefit Plans relating to the Selling
Entities or their employees (the "SELLING ENTITIES' EMPLOYEE BENEFIT
PLANS").
(13) RETAINED PATENTS. The Patents described in Schedule
2.01(b)(13) of the Selling Entities' Disclosure Letter.
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(c) ASSETS FREE OF LIENS. Except as otherwise specifically provided
in this Agreement and except for Permitted Liens, all of the Assets to be
transferred hereunder shall be transferred free and clear of all liens, claims,
encumbrances, restrictions or rights of others of every kind and description,
including, without limitation, tax liens.
2.02 INSTRUMENTS OF CONVEYANCE AND TRANSFER. At the Closing, the Selling
Entities shall execute and deliver to Purchaser as appropriate (a) a ▇▇▇▇ of
Sale, Assignment and Assumption Agreement transferring to Purchaser the
properties and assets to be acquired by it under the terms of this Agreement in
substantially the form of EXHIBIT A annexed hereto, (b) a Lease Assignment
Agreement assigning the real property leased by the Selling Entities in
conjunction with the Business to Purchaser in substantially the form of EXHIBIT
C annexed hereto, and (c) such other bills of sale, instruments of assignment,
certificates of title, registrations, licenses and other documents as may be
reasonably necessary or appropriate to vest in Purchaser good title to the
Assets or to carry out the transactions contemplated by this Agreement. The
Selling Entities shall assist Purchaser as reasonably required after the
Closing to register and record with appropriate governmental authorities the
conveyance and transfer documents.
2.03 NONASSIGNABLE CONTRACTS. Nothing in this Agreement shall be construed
as an attempt or agreement to assign any contract or claim as to which a
required third party consent to assignment (including, without limitation, any
prime contract with a United States governmental entity) cannot be obtained.
If, however, following the Closing, there is any contract, agreement, license,
lease, sales order, purchase order or other commitment which would have
constituted an Assigned Contract had the required consent been obtained, or any
claim for which consent to the assignment thereof cannot be obtained, the
Selling Entities and Purchaser agree to take such action, to the extent
permitted by applicable law, as may be necessary in order for Purchaser to
obtain the benefit and/or assume the obligations thereunder, including the
Selling Entities designating Purchaser as the Selling Entities' subcontractor
or agent for purposes of performing such contracts and the Selling Entities
collecting monies due under such contracts and paying the same promptly over to
Purchaser.
ARTICLE III
CLOSING, PURCHASE PRICE,
ASSUMPTION OF LIABILITIES
3.01 CLOSING. The closing of the transactions contemplated hereby (the
"CLOSING") shall take place on the business day next following the day the last
of the conditions precedent contained in Articles VIII and IX shall have been
satisfied or waived. The day on which the Closing actually takes place is
herein sometimes referred to as the "CLOSING DATE". The Closing shall take
place in the offices of Seller, ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ #▇, ▇▇▇▇▇▇▇,
▇▇▇▇▇, and shall be deemed to be effective at the close of business on the
Closing Date.
3.02 CONSIDERATION. Upon the terms and subject to the conditions set
forth in this Agreement and in exchange and consideration for the Assets and
other consideration set forth in this Agreement, Purchaser shall:
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(a) On and as of the Closing Date, pay to Seller the "Estimated
Purchase Price" in accordance with, and to the extent provided in, Section
3.03; and
(b) Assume as of the Closing Date those certain debts, liabilities,
and obligations of the Selling Entities in respect of the Business specified in
Section 3.04 (as limited by Section 3.05) in accordance with, and to the extent
provided in, Section 3.04.
3.03 PURCHASE PRICE AND PAYMENT THEREOF.
(a) PURCHASE PRICE AND PAYMENT OF ESTIMATED PURCHASE PRICE.
Purchaser shall on the Closing Date, pay by wire transfer of immediately
available United States funds, to the account of Halliburton Delaware, Inc. at
Citibank N.A., ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇, Account No. ▇▇▇▇▇▇▇▇, ABA
Routing No. 012000089 for the benefit of ▇▇▇▇▇ & Root, Inc. and Halliburton NUS
Corporation, $31,700,000 (the "ESTIMATED PURCHASE PRICE") which amount
represents the parties' current estimate of the Purchase Price.
The purchase price for the Assets and the Business shall be the
Estimated Purchase Price, subject to adjustment, dollar for dollar, in
accordance with Section 3.03(c) (the "PURCHASE PRICE").
(b) DETERMINATION OF PURCHASE PRICE.
(i) For purposes of this Agreement, (1) the "FINAL CLOSING
BALANCE SHEET" shall mean a statement of Assets and Assumed
Liabilities as of the Closing Date prepared in accordance with
Section 3.03(b)(i) and in the format set forth on EXHIBIT D, (2) the
"ADJUSTED JUNE BALANCE SHEET" shall mean a statement of Assets and
Assumed Liabilities as of June 30, 1997, which is attached as EXHIBIT
E, (3) the "CLOSING NET ASSETS" shall mean the total of Assets less
Assumed Liabilities as of the Closing Date, as set forth on the Final
Closing Balance Sheet, and (4) the "JUNE 30 NET ASSETS" shall mean
the total of Assets less Assumed Liabilities, as of June 30, 1997, as
set forth on the Adjusted June Balance Sheet.
The Final Closing Balance Sheet shall be prepared from the
books and records of the Business kept in accordance with United
States generally accepted accounting principles ("GAAP") applied on a
consistent basis. The Final Closing Balance Sheet will be prepared on
a basis consistent with that used in the preparation of the Adjusted
June Balance Sheet, except that (a) all intangible Assets shall,
except those having a value reflected on the Adjusted June Balance
Sheet, be valued at zero, and (b) the Final Closing Balance Sheet
shall not reflect any Excluded Assets or any Excluded Liabilities.
(ii) Within thirty (30) days following the Closing Date,
Seller, with the assistance and cooperation of Purchaser, shall
prepare and deliver to Purchaser a
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statement of Assets and Assumed Liabilities as of the
Closing Date (the "PRELIMINARY CLOSING BALANCE SHEET"),
prepared as provided in paragraph (i) above and a
Statement of Operations as of the Closing Date, prepared
consistent with the Statements of Operations described in
Section 5.18(b). Purchaser shall have ten (10) days
following its receipt of the Preliminary Closing Balance
Sheet (the "REVIEW PERIOD"), to review the same for
compliance with paragraph (i) above. On or before the
expiration of the Review Period, Purchaser shall deliver
to Seller a written statement accepting or objecting to
the Preliminary Closing Balance Sheet. In the event that
Purchaser shall object to the Preliminary Closing Balance
Sheet, such statement shall include a detailed
itemization of Purchaser's objections and its reasons
therefor. Objections, if any, shall be limited to
transactions occurring subsequent to June 30, 1997. If
no such statement is delivered by Purchaser to Seller
within the Review Period, Purchaser shall be deemed to
have accepted the Preliminary Closing Balance Sheet.
(iii) In the event that Purchaser shall accept or shall
be deemed to have accepted the Preliminary Closing Balance sheet as
prepared and delivered by Seller, the Preliminary Closing Balance
Sheet shall constitute the Final Closing Balance Sheet for purposes
of determining any adjustment to the Estimated Purchase Price. In
the event, however, that Purchaser shall object to the Preliminary
Closing Balance Sheet within the Review Period, Purchaser and Seller
shall promptly meet and in good faith attempt to resolve such
objections. Any such objections which cannot be resolved between
Purchaser and Seller within thirty (30) days following Seller's
receipt of Purchaser's statement of objections shall be resolved in
accordance with the procedures set forth in Section 3.02(e). The
Preliminary Closing Balance Sheet, as adjusted to reflect the
adjustments agreed upon by the parties or determined in accordance
with Section 3.02(e), shall constitute the Final Closing Balance
Sheet for purposes of determining any adjustment to the Estimated
Purchase Price.
(c) ADJUSTMENT AND SETTLEMENT OF PURCHASE PRICE. In the event that
the amount of the Closing Net Assets as finally determined is greater or less
than the amount of the June 30 Net Assets, such excess or deficiency, as the
case may be, shall be referred to as the "ADJUSTMENT." On the third business
day following the date upon which the Final Closing Balance Sheet as provided
for in Section 3.03(b)(iii) is determined, Purchaser shall pay to Seller (if
the Closing Net Assets are greater than the June 30 Net Assets), or Seller
shall pay to Purchaser (if the June 30 Net Assets are greater than the Closing
Net Assets), the amount of the Adjustment. Payment of the Adjustment shall be
made by wire transfer of immediately available United States funds.
(d) ALLOCATION OF PURCHASE PRICE. The consideration given by
Purchaser under this Agreement (including without limitation the payment of the
Purchase Price and the assumption of the Assumed Liabilities) shall be
allocated among the Assets in accordance with section 1060 of the Internal
Revenue Code of 1986, as amended (the "CODE"), and the regulations under the
Code.
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A schedule setting forth such proposed allocations shall be prepared by
Purchaser and delivered to the Selling Entities within one hundred twenty (120)
days following the Closing Date. The determination of the amount of
consideration paid by Purchaser, including the Assumed Liabilities, and its
allocation as set forth on such schedule shall be reasonably determined by
Purchaser and shall be reasonably satisfactory to the Selling Entities.
Purchaser and the Selling Entities agree to make such allocation in filing
their respective tax returns or declarations for applicable United States
income tax purposes.
(e) ACCOUNTING OBJECTIONS. Should the Selling Entities and
Purchaser not be able to resolve such objections as may be raised with respect
to the Preliminary Closing Balance Sheet, the Final Closing Balance Sheet or
adjustments to the Estimated Purchase Price (collectively, the "ACCOUNTING
OBJECTIONS"), the Accounting Objections shall be submitted to a binding
arbitration to be conducted by AA which shall represent Seller and the
independent public accounting firm of DT which shall represent Purchaser.
Should AA and DT be unable to agree on the resolution of the Accounting
Objections, after negotiating in good faith for a period of thirty (30) days,
the same shall be submitted to Ernst & Young LLP for a binding resolution. The
Selling Entities and Purchaser shall be responsible for the fees of their
respective accounting firms. The fees of the third accounting firm, if one is
required, shall be borne equally by the Selling Entities and Purchaser.
3.04 ASSUMPTION OF LIABILITIES. Purchaser shall assume as of the Closing
Date and agrees to pay, honor and discharge in accordance with the terms
thereof all of the Assumed Liabilities. The term "ASSUMED LIABILITIES" shall
mean only the following liabilities and obligations relating to the Business
or the Assets:
(a) Any and all liabilities, obligations and commitments relating to
the Business which arise out of, or relate to (i) events or occurrences after
the Closing Date, including, without limitation, any violation of any
applicable federal, state, provincial or local environmental Laws or
regulations, or (ii) the Assigned Contracts, but in any case, not including any
liability for any breach thereof occurring prior to the Closing Date;
(b) Any and all taxes which may be applicable to the Business or the
Assets arising from events or occurrences after the Closing Date, including
without limitation, sales, use or transfer taxes resulting from the sale of the
Assets to Purchaser;
(c) Any and all liabilities, obligations and commitments
specifically undertaken by Purchaser pursuant to the other terms of this
Agreement;
(d) Any and all liabilities included on the Final Closing Balance
Sheet, including, without limitation, all accounts payable. Pending
determination of the Final Closing Balance Sheet, the Selling Entities shall
furnish to Purchaser at Closing the latest available listing of liabilities of
the Business which constitute Assumed Liabilities;
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(e) All risks associated with the use of any equipment purchased
hereunder as part of the Assets, including liability to any third party, for
any injury or damage to persons or property and any damage to the equipment
itself, arising after the Closing Date, due to any condition of, defect in or
design of the equipment, latent or otherwise, whether now existing or hereafter
occurring; and
(f) Set forth on Schedule 3.04(f) of the Selling Entities'
Disclosure Letter are the Performance Bonds outstanding as of May 21, 1997. At
the Closing, Selling Entities will deliver to Purchaser an updated schedule of
Performance Bonds. From and after the Closing Date, Purchaser shall use its
best efforts to put bonding facilities in place so as to allow the termination
of the Performance Bonds, and in all events such bonding facilities shall be
put in place within ninety (90) days after the Closing Date. Purchaser shall
indemnify and hold harmless Selling Entities and their Affiliates from and
against any liability resulting from, or obligations incurred under the
Performance Bonds after the Closing Date. Purchaser shall pay Selling Entities
for the cost of the Performance Bonds attributed to the period after Closing
for which such Performance Bonds remain in force. Such payment shall be made at
the time of the payment of the Adjustment referred to in Section 3.03(c).
3.05 EXCLUDED LIABILITIES. Purchaser shall not assume and shall not be
responsible for any liabilities, obligations or commitments of the Selling
Entities relating to or arising out of the operation of the Business prior to
the Closing Date (the "EXCLUDED LIABILITIES") other than the Assumed
Liabilities.
3.06 COLLECTION AND REPURCHASE OF ACCOUNTS RECEIVABLE.
(a) COLLECTION OF THE SELLING ENTITIES' ACCOUNTS RECEIVABLE. On the
Closing Date, the Selling Entities shall deliver to Purchaser the most recent
listings available of invoices and the unpaid amount of each, unbilled
receivable amounts by customer (showing the contract, type of charge and period
covered), the invoices and amounts which comprise unearned revenue, and other
items making up the total accounts receivable of the Business.
Contemporaneously with the delivery of the Preliminary Closing Balance Sheet,
the Selling Entities shall deliver to Purchaser listings of such items updated
through the Closing Date. During the ninety (90) day period following the
Closing (the "COLLECTION PERIOD"), Purchaser shall use normal collection
procedures (but in no event shall Purchaser be obligated to file or perfect any
liens or file or prosecute any suit as part of its collection effort) to
collect all invoice amounts, notes and drafts receivable, and unbilled
receivable amounts and other receivable items in respect of the Business as of
the Closing Date which are included in the Final Closing Balance Sheet (the
"CLOSING DATE RECEIVABLES"). Any payments received by Purchaser from any
person who is the account debtor on any of the Closing Date Receivables (a
"CUSTOMER") shall be applied as specified by the Customer, unless (i) it is
uncertain which invoice is being paid, or (ii) part of the invoice covers
unbilled receivables. In either such case, payments shall be applied in the
order of the oldest invoice or unbilled receivable first, unless Purchaser or
the Selling Entities shall have received notice of a bona fide dispute with
respect to such account. Each of the Selling Entities shall promptly remit to
Purchaser any payments which it may receive in respect of any of the Closing
Date Receivables.
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Each of the Selling Entities grants to Purchaser the authority, coupled with
an interest, to receive, endorse, cash, deposit, and receipt for any checks,
drafts, documents and instruments evidencing Closing Date Receivables which
are in the name of any of the Selling Entities. Purchaser shall make and keep
detailed records of amounts collected in respect of the Closing Date
Receivables until such time as any Uncollected Receivables are assigned to
the Selling Entities pursuant to paragraph (b) below, and shall make such
records available for review by the Selling Entities when a statement of
Uncollected Receivables is delivered to the Selling Entities.
(b) REPURCHASE OF ACCOUNTS RECEIVABLE. Promptly following the
expiration of the Collection Period (but not earlier than ten (10) days
following determination of the Final Closing Balance Sheet), Purchaser shall
deliver to the Selling Entities a statement setting forth (i) a list and
description of the Closing Date Receivables (excluding any notes or accounts
receivable that have been paid down in accordance with their terms) that were
not collected during the Collection Period (the "UNCOLLECTED RECEIVABLES"), and
(ii) a schedule setting forth the calculation of the aggregate amount of
Uncollected Receivables, LESS credit balances, unearned revenue and the reserve
for uncollectible accounts, if any, included in the Final Closing Balance
Sheet. Within ten (10) business days following the Selling Entities' receipt of
such statement, the Selling Entities shall pay to Purchaser, by wire transfer
of immediately available funds, the amount of such statement, and upon receipt
of such payment, Purchaser shall assign without recourse the Uncollected
Receivables to the Selling Entities. If Purchaser does not provide the Selling
Entities with a list and description of Uncollected Receivables within thirty
(30) days after expiration of the Collection Period, Purchaser may not demand
that the Selling Entities repurchase the Uncollected Receivables or otherwise
hold the Selling Entities responsible for nonpayment thereof and Purchaser
shall have no other remedy against the Selling Entities with respect to the
Uncollected Receivables. Purchaser shall promptly remit to the Selling Entities
any payment it may receive in respect of Uncollected Receivables which have
been assigned to the Selling Entities.
(c) REMEDY FOR UNCOLLECTED RECEIVABLES. The provisions of Article X
notwithstanding, the Selling Entities' obligation for such Uncollected
Receivables shall be satisfied by making the payment provided for in Section
3.06(b) above, and no other remedy shall be available with respect to such
Uncollected Receivables.
ARTICLE IV
PURCHASER'S REPRESENTATIONS AND WARRANTIES
Purchaser represents and warrants that the following are true and correct
as of the date of this Agreement:
4.01 ORGANIZATION AND GOOD STANDING. Purchaser is a corporation duly
organized, validly existing and in good standing under the laws of the state of
its incorporation and is duly qualified and licensed to do business as a
foreign corporation and is in good standing in the jurisdictions in which it
conducts its business. On the Closing Date, Purchaser will be duly qualified
and licensed to conduct the Business and will be in good standing in each
jurisdiction in
14
which the Assets are located and the Business is conducted. Purchaser has all
requisite corporate power and authority to acquire, own, lease and operate
the Assets and the Business, to perform its obligations hereunder and to
execute and deliver this Agreement.
4.02 AUTHORIZATION AND VALIDITY. The execution, delivery and performance
of this Agreement by Purchaser and the consummation of the transactions
contemplated hereby have been duly authorized by all necessary corporate action
on the part of Purchaser. This Agreement has been duly executed and delivered
by Purchaser and constitutes the legal, valid and binding obligation of
Purchaser, enforceable against Purchaser in accordance with its terms, except
as may be limited by bankruptcy, insolvency, reorganization, moratorium and
other similar laws and equitable principles relating to or limiting creditor's
rights generally.
4.03 NO VIOLATION. Neither the execution and performance of this
Agreement nor the consummation of the transactions contemplated hereby will (a)
result in a violation or breach of the charter or bylaws of Purchaser or any
agreement or other instrument under which Purchaser is bound or to which any
assets of Purchaser are subject, or (b) violate any applicable law or
regulation or any judgment or order of any court or governmental agency or any
indenture, agreement or other instrument to which Purchaser is a party or by
which Purchaser or its properties or assets are bound, or conflict with, result
in a breach of or constitute (with due notice or lapse of time or both) a
default under, or result in the creation or imposition of any lien, charge or
encumbrance pursuant to, any such indenture, agreement or other instrument,
excluding from the foregoing clauses (a) and (b) violations, conflicts,
breaches, defaults or creations of liens, charges or encumbrances which would
not, individually or in the aggregate, have a material adverse effect on the
financial condition, business or results of operations of Purchaser, or on the
ability of Purchaser to consummate the transactions contemplated hereby.
Purchaser has complied in all material respects with all applicable laws,
regulations and licensing requirements, and has filed with the proper
authorities all necessary statements and reports.
4.04 LITIGATION. There is no legal action, suit, arbitration,
governmental investigation or other legal or administrative proceeding, nor any
order, decree or judgment in process, pending or in effect, or to the knowledge
of Purchaser, threatened against or relating to Purchaser in connection with or
relating to the transactions contemplated by this Agreement, and Purchaser does
not know nor have any reason to be aware of any basis for the same.
4.05 CONSENTS. Except as set forth in Schedule 4.05 of the Purchaser's
Disclosure Letter, no authorization, consent, approval, permit or license of,
or filing with, any governmental or public body or authority, any lender or
lessor or any other person or entity is required to authorize, or is required
in connection with, the execution, delivery and performance of this Agreement
on the part of Purchaser.
4.06 FINDERS' FEES. Except as set forth in Schedule 4.06 of the
Purchaser's Disclosure Letter, Purchaser has made no agreement with any person
or entity nor taken any action which would cause any person or entity to become
entitled to agents', brokers', investment bankers' or finders' fees in
connection with the transactions contemplated hereby.
15
4.07 CONDITION OF ASSETS. PURCHASER HAS CAREFULLY INSPECTED THE ASSETS
AND KNOWINGLY AND VOLUNTARILY ACCEPTS THE ASSETS "AS IS" AND "WHERE IS", WITH
NO REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED, HAVING BEEN MADE BY OR ON
BEHALF OF THE SELLING ENTITIES WITH RESPECT TO THE PRESENT CONDITION OF THE
ASSETS OR THE PRESENT OR FUTURE SUITABILITY THEREOF FOR ANY INTENDED USE BY
PURCHASER. PURCHASER HAS HAD AN OPPORTUNITY PRIOR TO EXECUTION HEREOF TO
UNDERTAKE SUCH INVESTIGATIONS OF THE ASSETS AS IT DEEMED NECESSARY OR
APPROPRIATE AND TO EXAMINE AND REVIEW SUCH RECORDS, DOCUMENTS, REPORTS AND
OTHER INFORMATION OF THE SELLING ENTITIES WITH RESPECT THERETO AS IT DEEMED
RELEVANT TO THE CONSUMMATION OF THIS AGREEMENT, EXCEPT THAT NO SUCH
INVESTIGATION OR EXAMINATION SHALL CONSTITUTE A WAIVER BY PURCHASER OF ITS
RIGHT TO RELY ON THE TERMS AND CONDITIONS OF THIS AGREEMENT.
4.08 DISCLOSURE. The statements contained in this Agreement, in the
Purchaser's Disclosure Letter, and in any other written documents or schedules
attached hereto prepared and delivered by or on behalf of the Purchaser
pursuant to the terms hereof, are true and correct in all material respects,
and such statements, documents or schedules do not omit any material fact
required by the terms hereof or thereof to be stated herein or therein or
necessary to make the statements contained herein or therein, in light of the
circumstances under which they were made, not misleading.
ARTICLE V
SELLING ENTITIES' REPRESENTATIONS AND WARRANTIES
.
The Selling Entities represent and warrant that the following are true and
correct as of the date of this Agreement:
5.01 ORGANIZATION AND GOOD STANDING. Each of the Selling Entities is a
corporation duly organized, validly existing and in good standing under the
Laws of the jurisdiction of its incorporation, with all requisite power and
authority to carry on the Business as it is now conducted and to own and
operate the Assets and the Business as and in the places where the Business is
now conducted and such Assets are now owned, located or operated. Each of the
Selling Entities is duly qualified and licensed to do business and is in good
standing in each jurisdiction where the nature of the Business makes such
qualification necessary. Each such jurisdiction is listed in Schedule 5.01 of
the Selling Entities' Disclosure Letter.
5.02 AUTHORIZATION AND VALIDITY. The execution, delivery and performance
of this Agreement by the Selling Entities, and the consummation of the
transactions contemplated hereby, have been duly authorized by all necessary
corporate action on the part of the Selling Entities. This Agreement has been
duly executed and delivered by the Selling Entities and constitutes the legal,
16
valid and binding obligation of the Selling Entities, enforceable against them
in accordance with its terms, except as limited by bankruptcy, insolvency,
reorganization, moratorium and other similar Laws and equitable principles
relating to or limiting creditor's rights generally.
5.03 EMPLOYEE BENEFIT PLANS. As a result of the sale of Assets and
Business or any related transaction contemplated herein, including but not
limited to the employment by the Purchaser of the Selling Entities' active
employees working for the Business on the Closing Date, as contemplated at
Section 6.05, Purchaser will not incur any liability with respect to either the
Employee Benefit Plans previously maintained, now maintained, or at any time in
the future maintained by either of the Selling Entities or by any Affiliate of
the Selling Entities, including but not limited to, liability with respect to
funding obligations to or with respect to any Employee Benefit Plans, liability
to or with respect to any benefit plan which is a 'multi-employer plan', as
defined at Section 3(37) of the Employee Retirement Income Security Act of 1975
("ERISA"), liability to or with respect to any Employee Benefit Plan described
at Section 4063(a) of ERISA, or any liability to or with respect to Employee
Benefit Plans subject to Title IV of ERISA.
5.04 ABSENCE OF CERTAIN CHANGES. Except as set forth in Schedule 5.04 of
the Selling Entities' Disclosure Letter, since June 30, 1997, (i) there has
been no material adverse change in the financial condition of the Business,
Assets, results of operations of the Business, or the Business taken as a whole
and (ii) there have been no dispositions or acquisitions of capital assets over
$10,000, except in the ordinary course of the Business.
5.05 TITLE.
(a) Except as set forth in Schedule 5.05 of the Selling Entities'
Disclosure Letter and except for Permitted Liens, the Selling Entities own good
and marketable title to, or have a valid leasehold interest in or hold a valid
right under contract or agreement to use all Assets and such property is owned,
leased or so held free and clear of any and all liens, claims and encumbrances.
(b) The name "NUS" is not a registered name or ▇▇▇▇. THE SELLING
ENTITIES MAKE NO WARRANTY, EXPRESS OR IMPLIED, WITH RESPECT TO TITLE TO, OR ANY
OTHER RIGHTS TO, THE NAME OR TRADE NAME "NUS." Furthermore, Seller's Affiliate
has made prior assignments with respect to use of the name "NUS" in conjunction
with the sale of its energy business and its training business.
(c) Except for the Excluded Assets, the Assets constitute all of the
assets and properties used exclusively by the Selling Entities in the Business
as conducted on the date of this Agreement.
5.06 COMMITMENTS.
(a) Except as set forth in Schedule 5.06(a) of the Selling Entities'
Disclosure Letter, the Selling Entities have not entered into, nor are the
Assets or Business bound by, whether
17
or not in writing, any commitment which may, in any material respect, prevent
or interfere with the Selling Entities' transfer of the Assets and Business
in accordance with this Agreement.
(b) Except as contemplated herein or as set forth in Schedule
5.06(b) of the Selling Entities' Disclosure Letter, (i) the Selling Entities do
not currently contemplate, nor do they have any reason to believe any other
person or entity currently contemplates, any amendment or change to any
Assigned Contract which could have a material adverse effect on the Business
taken as a whole; and (ii) since June 30, 1997, none of the major suppliers of
the Business has refused, or communicated that it will or may refuse, to supply
goods or services, as the case may be, or has communicated that it will or may
substantially reduce the amounts of goods or services that it is willing to
sell to the Selling Entities.
5.07 INTELLECTUAL PROPERTY. The Selling Entities own, subject to the
licenses granted to third parties listed in Schedule 5.07(a) of the Selling
Entities' Disclosure Letter, all the Intellectual Property, or possess licenses
or other rights, if any, therefor without conflict, except as set forth in
Schedule 5.07(b) of the Selling Entities' Disclosure Letter, with the rights of
others. The Intellectual Property constitutes all of the intellectual property
the Selling Entities have used exclusively in the conduct of the operations of
the Business as conducted on the date of this Agreement.
5.08 NO VIOLATION. Except as set forth in Schedule 5.08 of the Selling
Entities' Disclosure Letter, neither the execution and performance of this
Agreement nor the consummation of the transactions contemplated hereby will (a)
result in a violation or breach of the certificate of incorporation, articles
of incorporation or bylaws of the Selling Entities, as applicable, or any
agreement or other instrument under which the Selling Entities are bound or to
which any of the assets of the Selling Entities are subject, or result in the
creation or imposition of any lien, charge or encumbrance upon any of such
assets, or (b) violate any applicable law or regulation or any judgment or
order of any court or governmental agency or any indenture, agreement or other
instrument to which either of the Selling Entities is a party or by which the
Selling Entities or their properties or assets are bound, or conflict with,
result in a breach of or constitute (with due notice or lapse of time or both)
a default under, or result in the creation or imposition of any lien, charge or
encumbrance pursuant to, any such indenture, agreement or instrument.
5.09 TAXES. The Selling Entities do not have any liability, fixed or
contingent, for any unpaid federal, state or local taxes or other governmental
or regulatory charges whatsoever (including without limitation withholding and
payroll taxes), other than for taxes not yet due and payable, which could
result in a lien on the Assets or the Business after conveyance thereof to
Purchaser or in any other form of transferee liability to Purchaser.
5.10 GOVERNMENT APPROVALS. Except as set forth in Schedule 5.10 of the
Selling Entities' Disclosure Letter, no authorization, consent, approval,
permit or license of, or filing with, any governmental or public body or
authority is required to be obtained by the Selling Entities for the execution
and delivery of this Agreement or the consummation by the Selling Entities of
the transactions contemplated hereby.
18
5.11 LABOR RELATIONS. Except as set forth in Schedule 5.11 of the Selling
Entities' Disclosure Letter, the Selling Entities have not experienced within
the last two years and are not experiencing as of the date of this Agreement,
nor do the Selling Entities know of any reason to expect, any labor disputes,
including strikes, work stoppages, slow-downs or other material interference
with or impairment of the Business by labor, nor have the Selling Entities
received in the year prior to the date of this Agreement any complaints of any
unfair labor practice with regard to the employees of the Business. The
Selling Entities are not experiencing, nor do the Selling Entities know of, any
current or contemplated union organization efforts or negotiations, or requests
for negotiations, representation or any labor contract relating to the
employees of the Business.
5.12 COMPLIANCE WITH LAWS. Except as described in Schedule 5.12 of the
Selling Entities' Disclosure Letter (i) the Selling Entities are presently
conducting the Business in material compliance with (a) all applicable laws,
rules, regulations and ordinances of all governmental and regulatory
authorities (federal, state, local or otherwise) (collectively, "Statutes"),
and (b) all applicable orders, writs, injunctions, judgments, decrees and
awards of all governmental and regulatory authorities (federal, state, local or
otherwise) (collectively, "Decrees"); (ii) the Selling Entities have not
received notification of any asserted present or past failure of the Selling
Entities so to comply with any Statute or Decree and no such violation of any
Statute or Decree exists or will exist upon the consummation of the
transactions contemplated by this Agreement, which could materially adversely
affect the operation of the Business after Closing; and (iii) the Selling
Entities are not subject to any Statute or Decree or any other restriction of
any kind or, which could materially adversely affect the operation of the
Business after Closing.
5.13 LITIGATION. Except as described in Schedule 5.13(a) of the Selling
Entities' Disclosure Letter, the Selling Entities have not had any legal action
or administrative proceeding or investigation instituted or, to the knowledge
of the Selling Entities' management, threatened which could have a material
adverse effect on the Assets or the Business. Except as disclosed in Schedule
5.13(b) of the Selling Entities' Disclosure Letter, the Selling Entities are
not (i) subject to any continuing court or administrative order, writ,
injunction or decree applicable specifically to the Business, Assets or
employees of the Business or (ii) in default with respect to any such order,
writ, injunction or decree. Schedule 5.13(c) of the Selling Entities'
Disclosure Letter sets forth all litigation with regard to the Business
claiming damages or losses in excess of $50,000 which is pending as of the date
of this Agreement.
5.14 EMPLOYEES. Set forth in Schedule 5.14(a) of the Selling Entities'
Disclosure Letter is a list of all employees of the Business as of October 10,
1997 showing such employees' positions, base compensation rate, employment date
and service date. Since June 30, 1997, except as set forth in Schedule 5.14(b)
of the Selling Entities' Disclosure Letter, the Selling Entities have not
granted or become obligated to grant any increases in the wages or salary of,
or paid or become obligated to pay any bonus or made or become obligated to
make any similar payment to, or grant any benefit to or on behalf of, any
officer, employee or agent (except in the ordinary course of business
consistent with past practices or pursuant to any plan, arrangement or policy
in effect on
19
the date hereof). Schedule 5.14(a) of the Selling Entities' Disclosure
Letter sets forth a list of all employment contracts between the Selling
Entities and the employees of the Business. Except as set forth in Schedule
5.14(a) of the Selling Entities' Disclosure Letter, neither Selling Entity is
a party to any other employment agreement, contract or understanding with any
of its employees of the Business that is not by its terms terminable at will
by such Selling Entity without liability. True and correct copies of such
agreements and any amendments thereto have been made available to Purchaser.
5.15 ASSIGNED CONTRACTS. Set forth in Schedule 2.01(a)(3) of the Selling
Entities' Disclosure Letter is a list of the Assigned Contracts, whether
written or oral, (a) by which any of the Assets are bound or (b) to which
either of the Selling Entities is a party or by which either is bound and which
relate exclusively to the Business or the Assets. The Selling Entities will
make available to Purchaser complete and correct copies of all Assigned
Contracts, and accurate descriptions of all oral Assigned Contracts, listed in
Schedule 2.01(a)(3) of the Selling Entities' Disclosure Letter or required to
be listed thereon together with all amendments thereto. Except as set forth in
Schedule 5.15 of the Selling Entities' Disclosure Letter, each Assigned
Contract is valid and enforceable in accordance with its terms, except as may
be limited by bankruptcy, insolvency, reorganization, moratorium or other
similar Laws and equitable principles relating to or limiting creditor's rights
generally; to the knowledge of the Selling Entities' management, there are no
threatened cancellations thereof nor outstanding disputes thereunder; and, to
the knowledge of the Selling Entities' management, there is no existing default
or event (including the execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby) which, with the giving of
notice or the passage of time or both, would constitute a default under any
such Assigned Contract. No Selling Entity has received notice from a customer
under an Assigned Contract that such customer intends to cease doing business
with the Selling Entities or materially alter the amount of business such
customer does with the Selling Entities, other than as a result of termination
of the contract in accordance with its terms.
5.16 ACCOUNTS RECEIVABLE. Set forth in Schedule 5.16(a) of the Selling
Entities' Disclosure Letter is a list and description as of September 27,1997,
including an aging, of all outstanding notes, drafts and accounts receivable,
including without limitation unbilled receivables (which unbilled receivables
are identified by customer), of the Selling Entities in respect of the
Business. All receivables which constitute Closing Date Receivables will be
valid and legally binding obligations of the persons obligated to pay such
accounts receivable and will be subject to no material counterclaim or set-off,
and all such receivables will be good and collectible in the ordinary course of
business, except (i) for unbilled receivables, which will be collectible when
billed, (ii) to the extent of the reserve for uncollectible accounts and the
amount of unearned revenue provided for in the books and records of the Selling
Entities in respect of the Business and included in the Final Closing Balance
Sheet, and (iii) as otherwise disclosed in Schedule 5.16(b) of the Selling
Entities' Disclosure Letter. The representations and warranties contained in
this Section 5.16 shall terminate on the date that the Uncollected Receivables
are repurchased by the Selling Entities pursuant to Section 3.06 or 30 days
after expiration of the Collection Period, whichever occurs earlier.
20
5.17 FINDERS' FEES. Except as set forth in Schedule 5.17 of the Selling
Entities' Disclosure Letter, the Selling Entities have made no agreement with
any person or entity nor taken any action which would cause any person or
entity to become entitled to agents', brokers', investment bankers' or finders'
fees in connection with the transactions contemplated hereby.
5.18 FINANCIAL STATEMENTS. The following financial statements relate to
the Business and are attached as EXHIBIT F hereto:
(a) Statements of Net Operating Assets as of June 30, 1997, December
31, 1996 and December 31, 1995; and
(b) Statements of Operations for the six month periods ended June
30, 1997 and for the years ended December 31, 1996, December 31, 1995 and
December 31, 1994.
Such financial statements are herein sometimes referred to
collectively as the "FINANCIAL STATEMENTS".
The Financial Statements have been prepared from the books and records of
Seller and Seller's Affiliate, but have not been audited. The Financial
Statements fairly present, in all material respects, the financial position and
results of operations of the Business at the dates and for the periods
indicated, except as may be set forth in the Selling Entities' Disclosure
Letter. While the transactions underlying the Financial Statements and the
statements described in Section 3.03(b) were accounted for in conformity with
GAAP, the Financial Statements and the statements described in Section 3.03(b)
are special purpose statements prepared for purposes of this Agreement and are
not prepared in accordance with GAAP.
(c) Set forth on Schedule 5.18(c) of the Selling Entities'
Disclosure Letter is a description of the manner in which the Financial
Statements and the statements described in Section 3.03(b) deviate from GAAP.
(d) Except as set forth on Schedule 15.8(d) of the Selling Entities'
Disclosure Letter or to the extent reflected on the Statement of Net Operating
Assets as of June 30, 1997, the Selling Entities had no material liabilities or
obligations (absolute, accrued, contingent or otherwise) ("Liabilities"). Since
June 30, 1997, the Selling Entities have not incurred any Liabilities, except
Liabilities incurred in the ordinary course of business or Liabilities
disclosed in this Agreement or in the Selling Entities' Disclosure Letter. At
the Closing, other than as set forth in Section 3.04(f) to the Selling
Entities' Disclosure Letter, there will be no oral or written guaranty by the
Selling Entities of any obligation of any person or entity, relating to the
Business, (i) for the borrowing of money, (ii) for the payment of any monetary
obligation of any nature whatsoever (whether due or to become due) or (iii) for
the performance of any obligation of any nature whatsoever.
5.19 LICENSES AND PERMITS. Each of the Selling Entities has all valid and
current permits, certificates, consents, approvals, authorizations, orders,
licenses, franchises and/or other
21
similar authority required by law or governmental regulations (collectively,
"Permits") from all applicable foreign, federal, state or local authorities
or agencies and any other regulatory authorities which are necessary in order
to operate the Business as presently conducted. To the knowledge of the
Selling Entities, neither of the Selling Entities is in default or
noncompliance under any such Permits.
5.20 [This section omitted intentionally.]
5.21 TRANSACTIONS WITH AFFILIATES. Except as set forth in this Agreement
or on Schedule 5.21 of the Selling Entities' Disclosure Letter, there is no
material lease, sublease, indebtedness, contract, agreement, commitment,
understanding or other material arrangement of any kind whatsoever having to do
with the Business and entered into by either of the Selling Entities with any
shareholder, officer or director of either Selling Entity or any Affiliate of
any of them.
5.22 DISCLOSURE. The statements contained in this Agreement, in the
Selling Entities' Disclosure Letter, and in any other written documents or
schedules attached hereto prepared and delivered by or on behalf of the Selling
Entities pursuant to the terms hereof, are true and correct in all material
respects, and such statements, documents or schedules do not omit any material
fact required by the terms hereof or thereof to be stated herein or therein or
necessary to make the statements contained herein or therein, in light of the
circumstances under which they were made, not misleading. There is no fact
known to the Selling Entities which would have a material adverse effect on the
Assets or the Business, other than those which have been set forth in this
Agreement, in the Selling Entities' Disclosure Letter, or in the other
documents, certificates and statements furnished to Purchaser prior to the date
hereof by or on behalf of the Selling Entities pursuant to this Agreement.
5.23 NO OTHER ASSETS NECESSARY TO THE BUSINESS. Except for the Excluded
Assets and except as set forth in Schedule 5.23 of the Selling Entities'
Disclosure Letter, Purchaser is acquiring hereunder all of the assets used by
Selling Entities exclusively in the Business as it is conducted by the Selling
Entities as of the date of this Agreement.
5.24 CONDITION OF ASSETS. Except as set forth in Schedule 5.24 of the
Selling Entities' Disclosure Letter and except for ordinary wear and tear, the
Fixed Assets, taken as a whole, are adequate for the uses for which they are
currently being employed and for the conduct of the Business as it is being
conducted on the date of this Agreement. THE ASSETS ARE CONVEYED TO PURCHASER
"AS IS" AND "WHERE IS", WITH NO REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED,
HAVING BEEN MADE BY OR ON BEHALF OF THE SELLING ENTITIES WITH RESPECT TO THE
PRESENT CONDITION OF THE ASSETS OR THE PRESENT OR FUTURE SUITABILITY THEREOF
FOR ANY INTENDED USE BY PURCHASER.
22
ARTICLE VI
PURCHASER'S COVENANTS
Purchaser covenants and agrees as follows:
6.01 RETENTION OF RECORDS, COOPERATION AND ACCESS.
(a) Purchaser shall retain all original books and records of the
Business which Purchaser receives from the Selling Entities. After the
Closing, the Selling Entities and their representatives shall have reasonable
access to all such books and records during normal business hours upon prior
notice to Purchaser. In addition, the Selling Entities shall have the right to
make abstracts or copies of any such books or records at their expense. If
Purchaser intends to dispose of any such original documents, it shall give the
Selling Entities notice of such intention. The Selling Entities shall have
ninety (90) days from receipt of notice either to advise Purchaser that they do
not desire to have such original documents or to collect such documents from
Purchaser at the Selling Entities' sole cost and expense.
(b) Purchaser shall use commercially reasonable efforts to cooperate
with the Selling Entities' representatives and agents (i) with respect to
performing the Selling Entities' obligations under Sections 10.06 and 10.07
hereof, (ii) in collecting the Uncollected Receivables, if any, repurchased
from Purchaser by Selling Entities pursuant to Section 3.06(b) hereof and the
Retained Accounts Receivable described in Section 2.01(b)(10), or (iii) in
prosecuting or defending any legal or administrative proceeding not transferred
to or assumed by Purchaser pursuant hereto. Cooperation, as it relates to
matters covered under (i) through (iii) above, shall include, but not be
limited to, causing Purchaser's employees to furnish documents in Purchaser's
possession as reasonably requested and using commercially reasonable efforts to
encourage its employees to testify as witnesses, appear for depositions and
take other similar actions as the Selling Entities may reasonably request. The
Selling Entities shall reimburse Purchaser for Purchaser's out-of-pocket costs
and expenses incurred with respect to the foregoing.
(c) Prior to Closing, Purchaser agrees that it shall not contact
customers and suppliers of the Business unless accompanied by a representative
of the Selling Entities or, if such contact is in writing, unless the writing
is signed by duly authorized representatives of Purchaser and the Selling
Entities.
6.02 TIMELY PAYMENT AND PERFORMANCE OF ASSUMED LIABILITIES. Purchaser
agrees to pay, perform and discharge each and every Assumed Liability in due
course and in accordance with the terms thereof.
6.03 SELLING ENTITIES' NAMES. Purchaser acknowledges that the
transactions contemplated hereby do not encompass any rights with respect to
the Selling Entities' Marks. Purchaser covenants and agrees not to publish or
distribute to third parties printed matter depicting, or otherwise use after
the Closing Date, the Selling Entities' names or the Selling Entities' Marks,
or any variations thereof, except with the prior express written consent
executed by duly authorized officers
23
of the Selling Entities. Within sixty (60) days after the Closing Date,
Purchaser agrees to delete permanently the Selling Entities' names and the
Selling Entities' Marks from all Assets in its possession or under its
control, including, without limitation, promotional materials, drawings and
signage.
6.04 WARRANTY WORK. Purchaser shall perform all service, repair,
replacement and similar work required under the Selling Entities' written
warranties for services provided and products sold by the Business prior to the
Closing Date ("WARRANTY WORK"), in a workmanlike manner and consistent in all
material respects with the Selling Entities' past practices. Prior to
commencing any such Warranty Work, Purchaser shall notify the Selling Entities
in writing of such Warranty Work claim, specifying the contractual basis
therefor, the scope of the Warranty Work proposed to be performed and the
estimated expense to be incurred in connection therewith. Upon receipt of
notice of a claim for Warranty Work, the Selling Entities shall promptly advise
Purchaser in writing of any objections the Selling Entities may have that the
proposed scope of Warranty Work exceeds that required under the Selling
Entities' pre-closing written warranty requirements, specifying the basis
therefor, and the parties shall thereafter attempt to negotiate, diligently and
in good faith, a mutually satisfactory resolution to any matters in dispute.
Purchaser may proceed with the Warranty Work upon the earlier to occur of (i)
fifteen (15) days after the Selling Entities' receipt of notice of the claim
for Warranty Work, if Purchaser has not received notification of the Selling
Entities' objections thereto or (ii) the parties' resolution of all disputed
matters with respect to such claim. The Selling Entities shall reimburse
Purchaser for any such Warranty Work in an amount equal to then year rates
approved for U.S. government work.
6.05 EMPLOYMENT BY PURCHASER. Purchaser agrees that an offer of
employment will be made to all of the Selling Entities' active employees, and
those on authorized leave, working for the Business on the Closing Date,
effective on such date. All such persons who may accept such employment are
hereinafter referred to as "EMPLOYEES." Each such person offered employment on
the Closing Date shall be offered employment at his or her rate of monthly or
hourly compensation in effect on the Closing Date together with employee
benefits generally available to Purchaser's other employees with comparable
years of service and rate of pay. For all applicable employee benefit
purposes, Purchaser shall give each such Employee credit for his or her prior
service with the Selling Entities or their Affiliates as shown in Schedule
5.14(a) of the Selling Entities' Disclosure Letter. Purchaser shall be
responsible for and shall indemnify the Selling Entities from and against any
and all liability under the Worker Adjustment and Retraining Notification Act,
in the event Purchaser fails or refuses to offer employment to a sufficient
number of the Selling Entities' employees to avoid liability under the act.
6.06 NOTICE OF CHANGE. To the extent of Purchaser's knowledge, Purchaser
shall give the Selling Entities prompt written notice of any material changes
in any of the information contained in the representation and warranties made
in Article IV or elsewhere in this Agreement or the Purchaser's Disclosure
Letter or Exhibits referred to herein which occur prior to Closing.
6.07 HSR FILING. Purchaser shall as soon as practicable after the date of
this Agreement file the notification and report form with the Federal Trade
Commission and the Antitrust Division
24
of the United States Department of Justice required under the ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ Antitrust Improvements Act of 1976, as amended, and the rules and
regulations promulgated thereunder ("HSR ACT"). Purchaser agrees to use
commercially reasonable efforts to eliminate any concern on the part of any
governmental entity regarding the legality of the transactions contemplated
under this Agreement.
6.08 INTENDED USE. The Purchaser acknowledges that, other than as set
forth in this Agreement, the Selling Entities make no warranty, express or
implied, regarding the commercial suitability or environmental quality of the
Leased Real Property for Purchaser's intended use. Purchaser's knowledge of its
intended commercial activity is superior to that of the Selling Entities and
consequently the Selling Entities cannot offer, and have not offered, any
warranty, express or implied, with regard to Purchaser's intended commercial
use of the Leased Real Property.
6.09 INSURANCE. For as long as any of the Leased Real Property is leased
by Purchaser pursuant to the Lease Assignment Agreement, Purchaser shall, at
its sole cost and expense, carry insurance on forms subject to approval of the
Selling Entities, with insurance companies or underwriters authorized to do
business in the states where the Leased Real Property is located and which are
otherwise satisfactory to the Selling Entities, as set forth below, provided if
the underlying lease specifies different requirements with respect to insurance
to be maintained by the lessee, those requirements will be complied with in
addition to these requirements.
(a) COMPREHENSIVE GENERAL LIABILITY INSURANCE: Such insurance shall
include the following coverages: (i) contractual liability to cover liability
assumed under this Agreement, (ii) broad form property damage liability
insurance, and (iii) premises operations hazards insurance. The limit of
liability for such insurance shall not be less than $2,000,000 combined single
limit per occurrence for bodily injury and property damage, $500,000 per
occurrence for fire damage and $5,000 medical expense limit per person. The
Selling Entities will be named as an additional insured on this policy and will
be provided with a waiver of subrogation in their favor.
(b) FIRE AND EXTENDED COVERAGE INSURANCE: Such insurance shall
include coverage on the improvements on the premises and the real estate
fixtures furnished and/or installed on the premises. The limit of liability
shall equal or exceed the appraised fair market value of the improvements and
fixtures. The Selling Entities will be named as an additional insured on this
policy as their interest may appear and will be provided with a waiver of
subrogation in their favor.
(c) STATUTORY WORKER'S COMPENSATION COVERAGE: Such coverage
pursuant to the Laws of the states in which the Leased Real Property is
located. The Selling Entities will be provided with a waiver of subrogation in
their favor.
(d) EMPLOYER'S LIABILITY INSURANCE: Such insurance shall include
coverage for liability under Longshoremen's and Harbor Worker's Act, the ▇▇▇▇▇
Act and the Outer Continental Shelf Land Act, if applicable. The limits of
liability of such insurance shall not be less
25
than $1,000,000 per accident. The Selling Entities will be named as an
additional insured on this policy and will be provided with a waiver of
subrogation in their favor.
The insurance referred to in this Section 6.09 shall be on an occurrence basis
and shall include a requirement that the insurer provide the Selling Entities
with 30 days' written notice prior to the effective date of any cancellation or
material change of said insurance. Purchaser shall provide the Selling Entities
with a certificate of insurance complying with the above requirements. Any and
all deductible, self insured retentions, retrospective adjustments and the like
in connection with the above policies are for Purchaser's account.
All insurance required herein shall be endorsed to provide that the insurance
provided thereby shall be primary insurance, as respects the Selling Entities
as an additional insured, irrespective of any "excess" or "other insurance"
clauses contained in policies maintained by the Selling Entities.
6.10 USE OF LEASED REAL PROPERTY. Purchaser hereby agrees that its use of
the Leased Real Property shall be subject to the terms and conditions set forth
below, which terms and conditions shall be incorporated verbatim into the Lease
Assignment Agreement by reference to this Section 6.10.
(a) HAZARDOUS MATERIALS.
(i) For the purposes hereof and for greater certainty
the term "HAZARDOUS MATERIALS" shall mean and include:
(1) such "solid waste or hazardous waste" as
defined by the Resource Conservation and Recovery Act of 1976
(41 U.S.C. Section 6901 et seq.), as amended from time to time
("RCRA"), and the regulations promulgated thereunder;
(2) any "hazardous substance" as defined by the
Comprehensive Environmental Response, Compensation and Liability
Act of 1980 (42 U.S.C. Section 9601 et seq.), as amended from
time to time ("CERCLA"), and the regulations promulgated
thereunder;
(3) asbestos (friable or otherwise);
(4) polychlorinated biphenyls, as defined by the
Federal Toxic Substance Control Act (15 U.S.C. Section 2601 et
seq.), as amended from time to time ("FTSCA");
(5) any substance the presence of which on the
Leased Real Property is prohibited by any Laws of the United
States or the state in which the Leased Real Property is located
or other governmental subdivisions having jurisdiction;
26
(6) petroleum based materials; and
(7) any other substance which is defined as
hazardous, toxic, infectious, or radioactive by any Laws to
which the Leased Real Property are subject.
(ii) the term "HAZARDOUS MATERIALS CONTAMINATION"
shall mean the contamination of the Leased Real Property, Leased
Real Property improvements, personalty, facilities, soil,
ground, water, air or other elements on, under or above the
Leased Real Property, or of any other property as a result of
the release or threatened release of any Hazardous Materials on
the Leased Real Property.
(iii) Purchaser hereby agrees to accept the physical and
environmental condition of the Leased Real Property and
further agrees that in the event any investigation or
monitoring of the site conditions or any clean-up,
containment, restoration, removal, or other corrective action
(collectively, referred to as "REMEDIAL WORK") is required
under any applicable federal, state, or local law or
regulation, or by any judicial order, or by any governmental
authority in connection with Hazardous Materials Contamination
occurring on or after the Closing Date, Purchaser, at its sole
cost and expense, shall perform or cause to be performed the
Remedial Work in compliance with such law, regulation, order
or agreement.
(iv) Throughout the term of any lease assignment,
Purchaser shall not treat, store or dispose of Hazardous
Materials on the Leased Real Property inconsistent with the
rights of a CESQG pursuant to 40 CFR 26.15. Any Hazardous
Materials generated and/or stored on the Leased Real Property
shall be shipped within a period of ninety (90) days to a
facility permitted to treat, store or dispose of Hazardous
Materials. Purchaser further agrees that all off-site shipments
of Hazardous Materials shall be shipped pursuant to all
applicable federal and state regulations pertaining to the
interstate and intrastate shipment of Hazardous Materials.
6.11 ENVIRONMENTAL STUDY. Prior to the termination of the tenancy with
respect to each Leased Property for which Purchaser requested Selling Entities
provide an environmental study pursuant to Section 7.12 and for which a study
was performed and a report given to the Purchaser, Purchaser, at its expense,
shall perform a comparable environmental study and provide a copy to the
Selling Entities.
27
ARTICLE VII
SELLING ENTITIES' COVENANTS
The Selling Entities covenant and agree that from the date of this Agreement
until the Closing:
7.01 BUSINESS OPERATIONS. The Selling Entities shall conduct the Business
only in the ordinary course consistent with past practices, and the Selling
Entities shall use commercially reasonable efforts to preserve intact the
Business and the goodwill of their customers and suppliers. The Selling
Entities shall not take any action that will materially impair the Business or
Assets without the prior written consent of Purchaser, or take or fail to take
any action that would cause or permit the representations made in Article V
hereof to be inaccurate at the time of Closing or preclude the Selling Entities
from making such representations and warranties at the Closing, except to the
extent such action is necessary to protect the business or assets of the
Selling Entities.
7.02 ACCESS. The Selling Entities shall permit Purchaser and/or its
authorized representatives, during normal business hours, full access to, and
make available for inspection, all of the Assets and the documents, records and
information, including, but not limited to, documents, records and information
concerning the Business' customers and suppliers, which pertain to such Assets
and to the Business, all for the sole purpose of permitting Purchaser to
become familiar with the Assets and the Business. In that connection, the
Selling Entities shall cause their officers and employees and the management
personnel of the Business to cooperate fully with Purchaser's reasonable
requests.
7.03 APPROVALS OF THIRD PARTIES. As soon as practicable after the
execution of this Agreement, through the Closing Date and to the extent
reasonably required, following the Closing Date, the Selling Entities will use
all reasonable efforts to secure all necessary approvals, consents, permits and
authorizations of third parties to the consummation of the transactions
contemplated by this Agreement, including consents necessary to assign to
Purchaser and have Purchaser assume all Assigned Contracts and obtain all
relevant security clearances. Such efforts shall include, to the extent
necessary, providing such third parties with information about Purchaser.
7.04 EMPLOYEE COMPENSATION AND BENEFIT MATTERS. Except with Purchaser's
prior written consent or pursuant to contracts or plans in existence as of the
date of this Agreement, and except for normal annual salary increases
consistent with past practices, prior to the Closing, no increase will be made
in the compensation or rate of compensation payable or to become payable to the
employees of the Business, no bonus, profit sharing, retirement, insurance,
death benefits, fringe benefit or other extraordinary or indirect compensation
shall accrue, be set aside or be paid to, for or on behalf of any of such
officers or employees other than pursuant to the terms of the Selling Entities'
Employee Benefit Plans as presently constituted, and no employment or benefit
related agreement or plan other than those now in effect shall be committed for
or adopted.
7.05 CONTRACTS. Except with Purchaser's prior written consent, the
Selling Entities shall not waive any material right, amend in any material
respect, or cancel any material contract or claim related to the Business. In
addition, the Selling Entities shall give Purchaser prompt written
28
notice of (i) any requested amendment in any material contract related to the
Business or (ii) any notification from a customer that such customer intends
to cease doing business with the Selling Entities or materially alter the
amount of business such customer does with the Selling Entities, other than
as a result of termination of the contract in accordance with its terms.
7.06 CAPITAL ASSETS; PAYMENTS OF LIABILITIES. Except with Purchaser's
prior written consent, the Selling Entities will not acquire or dispose of any
Assets which are capital assets used in the Business, except in the ordinary
course of business consistent with past practices. The Selling Entities shall
discharge or satisfy all liens on the Assets other than Permitted Liens and
shall pay all other liabilities of the Selling Entities which relate to the
Business as they become due through the Closing Date.
7.07 MORTGAGES, LIENS. Except with Purchaser's prior written consent or
except in the ordinary course of the Business consistent with the conduct of
the Business at the date of this Agreement, the Selling Entities will not enter
into or assume any mortgage, pledge, conditional sale or other title retention
agreement relating to the Assets, or voluntarily permit any lien, encumbrance
or claim of any kind, other than a Permitted Lien, to attach to any of the
Assets, whether now owned or hereafter acquired.
7.08 NOTICE OF CHANGE. To the extent of the knowledge of the Selling
Entities' management, the Selling Entities shall give Purchaser prompt written
notice of any material change in any of the information contained in the
representations and warranties made in Article V or elsewhere in this Agreement
or the Selling Entities' Disclosure Letter or Exhibits referred to herein which
occur prior to .
7.09 HSR FILING. Seller shall as soon as practicable after the date of
this Agreement file the notification and report form with the Federal Trade
Commission and the Antitrust Division of the United States Department of
Justice required under the HSR Act. Seller agrees to use commercially
reasonable efforts to eliminate any concern on the part of any governmental
entity regarding the legality of the transactions contemplated under this
Agreement.
7.10 NO TRANSACTIONS. For a period commencing on the date hereof and
terminating on the earlier of the termination of this Agreement pursuant to
Article XII or December 31, 1997, the Selling Entities shall not solicit or
initiate or encourage any proposal for, or engage in negotiations or
discussions concerning, a sale of the Business or all or substantially all of
the Assets, other than the transactions contemplated hereunder.
7.11 NONCOMPETITION. For a period of five years after the Closing Date
neither the Selling Entities nor any of their Affiliates shall engage directly
or indirectly in the Business; provided, however, that the provisions of this
Section 7.11 shall not prohibit the Selling Entities or their Affiliates from:
(i) providing customers with competing services by means of or
through the use of subcontractors and/or unaffiliated third parties,
which competing services are
29
ancillary to contracts performed by Selling Entities or
their affiliates, and further provided that such
competing services are not the predominant services being
provided;
(ii) entering into any business combination, consolidation,
merger or other type of business combination or acquisition
transaction with any other party or parties who own and/or operate a
business that competes with the Business, provided that at the time
of the transaction the competing business is not the principal
business of such other party; or
(iii) providing industrial wastewater consulting and
engineering services, geotechnical engineering and consulting
services and environmental resource consulting services, provided
such services will not be performed with respect to Hazardous
Materials and Remedial Work in conjunction with Hazardous Materials.
The foregoing notwithstanding, where permitted under an invitation to
contract or bid for work otherwise allowable under Section 7.11(iii) above
which is not in support of other business activity of the Selling Entities, the
Selling Entities shall, to the extent commercially reasonable, provide
Purchaser with notice of such invitation and Purchaser may submit a bid to
perform such work as a subcontractor of the Selling Entities. Nothing contained
herein shall obligate any party to bid or contract for such work or for Selling
Entities to accept a subcontract bid from Purchaser.
7.12 ENVIRONMENTAL STUDY. As soon as possible after entering into this
Agreement, Purchaser shall provide Selling Entities with a list of the Leased
Real Property for which Purchaser requests Selling Entities perform a baseline
environmental study. Selling Entities shall perform such baseline studies, at
their expense, and provide Purchaser with a copy of such reports.
ARTICLE VIII
PURCHASER'S CONDITIONS PRECEDENT TO CLOSING
Except as may be waived in writing by Purchaser, the Purchaser's
obligation to close the transactions contemplated under this Agreement is
subject to the fulfillment at or prior to the Closing of each of the following
conditions:
8.01 REPRESENTATIONS AND WARRANTIES. The representations and warranties
of the Selling Entities contained herein shall be true and correct in all
material respects as of the Closing (except where such representation and
warranty is made as of a date specifically set forth therein), subject to any
changes contemplated by this Agreement, and Purchaser shall not have discovered
any material error, misstatement or omission therein.
8.02 COVENANTS. The Selling Entities shall have performed and complied in
all material respects with all covenants or conditions required by this
Agreement to be performed and complied with by them prior to the Closing.
30
8.03 PROCEEDINGS. No action, proceeding or order by any court or
governmental body or agency shall have been threatened or instituted to
restrain or prohibit the carrying out of the transactions contemplated by this
Agreement, and the waiting period and any statutory extension thereof
applicable to the consummation of the transactions contemplated hereby under
the HSR Act shall have expired or been terminated and no action, suit or
proceeding shall have been initiated by the Antitrust Division of the United
States Department of Justice or the Federal Trade Commission challenging the
transactions contemplated hereby under the ▇▇▇▇▇▇▇ Act or the ▇▇▇▇▇▇▇ Act.
8.04 NO MATERIAL ADVERSE CHANGE. Other than as contemplated by Section
11.17, no material adverse change in the Assets or the Business taken as a
whole shall have occurred after the date of this Agreement and prior to the
Closing.
8.05 ▇▇▇▇ OF SALE. The parties hereto shall have executed and delivered
the ▇▇▇▇ of Sale, Assignment and Assumption Agreement.
8.06 LEASE ASSIGNMENT AGREEMENT. The parties hereto shall have executed
and delivered the Lease Assignment Agreement.
8.07 TRANSITION SERVICES AGREEMENT. The parties hereto shall have
executed and delivered the Transition Services Agreement.
8.08 DELIVERY OF OTHER DOCUMENTS. All other documents required under the
terms of this Agreement to be executed and delivered by the Selling Entities to
Purchaser at or prior to the Closing shall have been so delivered.
8.09 CERTIFICATE. The Selling Entities shall have delivered to Purchaser
a certificate dated as of Closing and signed by authorized officers of the
Selling Entities to the effect that all of the covenants, terms and conditions
of this Agreement to be complied with and performed by the Selling Entities at
or before the Closing have been complied with and performed in all material
respects.
ARTICLE IX
SELLING ENTITIES' CONDITIONS PRECEDENT TO CLOSING
Except as may be waived in writing by the Selling Entities, the Selling
Entities' obligation to close the transactions contemplated under this
Agreement is subject to fulfillment at or prior to the Closing of each of the
following conditions:
9.01 REPRESENTATIONS AND WARRANTIES. The representations and warranties
of Purchaser contained herein shall be true and correct in all material
respects as of the Closing (except where such representation and warranty is
made as of a date specifically set forth therein), subject to any changes
contemplated by this Agreement, and the Selling Entities shall not have
discovered any material error, misstatement or omission therein.
31
9.02 COVENANTS. Purchaser shall have performed and complied in all
material respects with all covenants or conditions required by this Agreement
to be performed and complied with by it prior to the Closing.
9.03 PROCEEDINGS. No action, proceeding or order by any court or
governmental body or agency shall have been threatened or instituted to
restrain or prohibit the carrying out of the transactions contemplated by this
Agreement, and the waiting period and any statutory extension thereof
applicable to the consummation of the transactions contemplated hereby under
the HSR Act shall have expired or been terminated and no action, suit or
proceeding shall have been initiated by the Antitrust Division of the United
States Department of Justice or the Federal Trade Commission challenging the
transactions contemplated hereby under the ▇▇▇▇▇▇▇ Act or the ▇▇▇▇▇▇▇ Act.
9.04 PURCHASE PRICE. Purchaser shall have paid the Estimated Purchase
Price in accordance with Section 3.03(a).
9.05 ▇▇▇▇ OF SALE. The parties hereto shall have executed and delivered
the ▇▇▇▇ of Sale, Assignment and Assumption Agreement.
9.06 LEASE ASSIGNMENT AGREEMENT. The parties hereto shall have executed
and delivered the Lease Assignment Agreement.
9.07 TRANSITION SERVICES AGREEMENT. The parties hereto shall have
executed and delivered the Transition Services Agreement.
9.08 DELIVERY OF OTHER DOCUMENTS. All other documents required under the
terms of this Agreement to be executed and delivered by Purchaser to the
Selling Entities at or prior to the Closing shall have been so delivered.
9.09 CERTIFICATE. Purchaser shall have delivered to the Selling Entities
a certificate dated as of Closing and signed by an authorized officer of
Purchaser to the effect that all of the covenants, terms and conditions of this
Agreement to be complied with and performed by Purchaser at or before the
Closing have been complied with and performed in all material respects.
ARTICLE X
LIABILITY AND INDEMNIFICATION
10.01 SELLING ENTITIES' LIABILITY AND INDEMNITY. Subject to the terms
and conditions of this Article X of this Agreement, the Selling Entities hereby
agree to be liable for and to indemnify, defend and hold Purchaser and its
officers, directors, agents, attorneys and Affiliates harmless from and against
all losses, claims, obligations, demands, assessments, penalties, liabilities,
costs, damages, reasonable attorneys' fees and expenses (collectively,
"DAMAGES") asserted against or incurred by any or all of them by reason of or
resulting from:
32
(a) An Excluded Liability; and
(b) A breach or failure by the Selling Entities of any
representation, warranty or covenant contained in this Agreement or in any
agreement executed pursuant to this Agreement and not waived in writing by
Purchaser prior to Closing.
10.02 PURCHASER'S LIABILITY AND INDEMNITY. Subject to the terms and
conditions of this Article X, Purchaser hereby agrees to be liable for and to
indemnify, defend and hold the Selling Entities and their officers, directors,
agents, attorneys and Affiliates harmless from and against all Damages asserted
against or incurred by any or all of them by reason of or resulting from:
(a) An Assumed Liability; and
(b) A breach or failure by Purchaser of any representation, warranty
or covenant contained in this Agreement or in any agreement executed pursuant
to this Agreement and not waived in writing by the Selling Entities prior to
Closing.
10.03 BASKET. Subject to the provisions of this Section 10.03, the
Selling Entities shall not be liable to Purchaser or required to indemnify
Purchaser pursuant to Section 10.01 unless and until the aggregate amount of
the Damages suffered or incurred by Purchaser, other than those Damages
described in Section 10.04 below, exceeds $100,000 (the "BASKET"). In the
event that the aggregate amount of such Damages exceeds the Basket, the Selling
Entities shall be responsible for such Damages, but only to the extent that
they are in excess of the Basket.
10.04 NON-BASKET ITEMS. The following Damages shall not be included
in the calculation of the Basket:
(a) Finder's fees for which the Selling Entities are liable pursuant
to Section 5.17; and
(b) Any and all claims related to Excluded Liabilities.
10.05 CAP. The Selling Entities' liability to Purchaser for Damages
described in Section 10.01(b) shall not exceed the Purchase Price; provided,
however, that those Damages described in Section 10.04 above shall not be
subject to this Section 10.05.
10.06 RESPONSIBILITY FOR BREACH OF AGREEMENT. The respective
obligations and liabilities of the Selling Entities and Purchaser to the other
for Damages pursuant to Sections 10.01(b) and 10.02(b) hereof are subject to
the provisions of Section 11.16.
10.07 CONDITIONS OF INDEMNIFICATION. The respective obligations and
liabilities of the Selling Entities and Purchaser (the "INDEMNIFYING PARTY")
to the other (the "INDEMNIFIED PARTY")
33
for Damages pursuant to Sections 10.01(a) and 10.02(a) hereof shall be
subject to the following terms and conditions:
(a) Within twenty (20) days (or such earlier time as might be
required to avoid prejudicing the Indemnifying Party's position) after receipt
of notice of commencement of any action evidenced by service of process or
other legal pleading, or with reasonable promptness after the assertion in
writing of any claim by a third party, the Indemnified Party shall give the
Indemnifying Party written notice thereof together with a copy of such claim,
process or other legal pleading, and the Indemnifying Party shall have the
right to undertake the defense thereof by representatives of its own choosing
and at its own expense; provided, however, that the Indemnified Party may
participate in the defense with counsel of its own choice and at its own
expense.
(b) In the event that the Indemnifying Party, by the thirtieth
(30th) day after receipt of notice of any such claim (or, if earlier, by the
tenth (10th) day preceding the day on which an answer or other pleading must be
served in order to prevent judgment by default in favor of the person asserting
such claim), does not elect to defend against such claim, the Indemnified Party
will (upon further notice to the Indemnifying Party) have the right to
undertake the defense, compromise or settlement of such claim on behalf of and
for the account and risk of the Indemnifying Party and at the Indemnifying
Party's expense, subject to the right of the Indemnifying Party to assume the
defense of such claim at any time prior to settlement, compromise or final
determination thereof upon reimbursement to the Indemnified Party of all costs
and expenses incurred by the Indemnified Party in conjunction with such defense
to that date.
(c) Anything in this Section 10.07 notwithstanding, the Indemnifying
Party shall not settle any claim without the consent of the Indemnified Party
unless such settlement involves only the payment of money and the claimant
provides to the Indemnified Party a release from all liability in respect of
such claim. If the settlement of the claim involves more than the payment of
money, the Indemnifying Party shall not settle the claim without the prior
consent of the Indemnified Party, which consent shall not be unreasonably
withheld.
(d) The Indemnified Party and the Indemnifying Party will each
cooperate with all reasonable requests of the other.
10.08 REMEDIES EXCLUSIVE. In the event of breach of this Agreement or
default hereunder, the remedies of the parties shall be limited to those set
forth in this Article X and Section 11.07, except that Purchaser shall be
entitled to seek an injunction, without posting a bond, in any court of
competent jurisdiction, to permanently enjoin Selling Entities from violating
the Noncompetition Provisions set forth in Section 7.11. No right to
rescission or other common law right of action shall exist with respect to any
breach of this Agreement or default hereunder.
34
ARTICLE XI
MISCELLANEOUS
11.01 AMENDMENT. This Agreement may be amended, modified or
supplemented only by an instrument in writing executed by a duly authorized
officer of each party to this Agreement.
11.02 ASSIGNMENT. Neither the Purchaser nor the Selling Entities may
assign their rights and obligations hereunder without the prior written consent
of the other party, which consent may be withheld for any reason whatsoever.
11.03 NOTICE. Any notice or communication must be in writing and
given by depositing the same in the United States mail, addressed to the party
to be notified, postage prepaid and registered or certified with return receipt
requested, or by delivering the same in person or by courier or by sending such
notice or communication by facsimile transmission. Such notice shall be deemed
received on the earlier of the date on which it is hand-delivered or otherwise
actually received or on the third business day following the date on which it
is so mailed. For purposes of notice, the addresses of the parties shall be:
If to the Selling Entities: ▇▇▇▇▇ & Root, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: Vice President-Legal
Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to: Halliburton Company
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: Executive Vice President and
General Counsel
Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇
If to Purchaser: NUS Acquisition Corp.
c/o Tetra Tech, Inc.
▇▇▇ ▇. ▇▇▇▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: President and Chief Executive
Officer
Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇
If to Parent: Tetra Tech, Inc.
▇▇▇ ▇. ▇▇▇▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: President and Chief Executive
Officer
35
Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇
Any party may change its address for notice by written notice given to the
other party.
11.04 PRE-CLOSING CONFIDENTIALITY. Except for a joint press release
to be issued upon execution of this Agreement, each party shall keep this
Agreement and its terms confidential until the Closing, unless in the opinion
of its counsel disclosure is required by law. In the event that the
transactions contemplated by this Agreement are not consummated for any reason
whatsoever, Purchaser and the Selling Entities hereby (i) acknowledge and agree
to be bound by all the terms and conditions set forth in the Confidentiality
Agreement attached hereto as Exhibit B and (ii) agree that, notwithstanding the
execution and delivery of the Agreement, the Confidentiality Agreement will
remain in full force and effect.
Should the transactions contemplated hereby not be consummated, nothing
contained in this Section shall be construed to prohibit the parties hereto
from operating a business in competition with each other, provided they do so
without disclosing or using confidential information of the other, in
accordance with the Confidentiality Agreement.
11.05 POST-CLOSING CONFIDENTIALITY. Each party shall not disclose or
use to compete with the other any confidential information pertaining to such
party which is obtained from such other party pursuant to this Agreement or any
document delivered in connection herewith or with the transactions contemplated
hereby, except as such use or disclosure may be required in the course of
performance hereof and such disclosure as may, in the opinion of such party's
counsel, be required by law. After Closing, the Selling Entities shall not
(except at the request of Purchaser) use or disclose to any third party any of
the technical, financial, operational or marketing information pertaining to
the Business except after and to the extent such information is or becomes
generally available to the public through no fault of the Selling Entities or
as may be necessary in connection with the Selling Entities' remaining or
future businesses or as may, in the opinion of the Selling Entities' counsel,
be required by law. The parties shall take all reasonable efforts to cause
their respective directors, officers, employees and agents to observe the
provisions of this Section 11.05.
11.06 ENTIRE AGREEMENT. This Agreement and the Exhibits hereto
(including the Confidentiality Agreement) supersede all prior agreements and
understandings relating to the subject matter hereof, except that the
obligations of any party under any agreement executed pursuant to this
Agreement shall not be affected by this Section.
11.07 COSTS, EXPENSES AND LEGAL FEES. Whether or not the transactions
contemplated hereby are consummated, each party hereto shall bear its own costs
and expenses (including, without limitation, attorneys', brokers', agents',
investment bankers' and finders' fees), except that each party hereto agrees to
pay the costs and expenses, including reasonable attorneys' fees, incurred by
the other party in successfully (a) enforcing any of the terms of this
Agreement, or (b) proving that the other party breached any of the terms of
this Agreement in any material respect.
36
11.08 SEVERABILITY. If any provision of this Agreement is held to be
illegal, invalid or unenforceable, such provision shall be fully severable and
this Agreement shall be construed and enforced as if such illegal, invalid or
unenforceable provision never comprised a part hereof, and the remaining
provisions hereof shall remain in full force and effect and shall not be
affected by the illegal, invalid or unenforceable provision or by its severance
herefrom.
11.09 WAIVER. All of the original rights and powers of either party
hereunder shall remain in force notwithstanding any neglect, forbearance or
delay in enforcement thereof and neither party shall be deemed to have waived
any of its rights or any provision of this Agreement or any notice given
hereunder unless such waiver is in a writing signed by an officer of the
waiving party. No such waiver by either party of any breach by the other party
of this Agreement shall be deemed a waiver of any continuing, future or
recurring breach.
11.10 GOVERNING LAW. THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF
THE PARTIES HERETO SHALL BE GOVERNED, CONSTRUED AND ENFORCED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF DELAWARE, WITHOUT REGARD TO THE CHOICE OF LAW
PROVISIONS THEREOF OR SUCH PROVISIONS OF ANY OTHER JURISDICTION.
11.11 CONSENT TO JURISDICTION AND SERVICE OF PROCESS. Any legal
action, suit or proceeding in law or equity arising out of or relating to this
Agreement or any of the transactions contemplated herein shall be instituted in
any state or federal court in Delaware, and each party agrees not to assert, by
way of motion, as a defense or otherwise, in any such action, suit or
proceeding, any claim that it is not subject personally to the jurisdiction of
such court, that its property is exempt or immune from attachment or execution,
that the action, suit or proceeding is brought in an inconvenient forum, that
the venue of the action, suit or proceeding is improper or that this Agreement
or the subject matter hereof may not be enforced in or by such court. Each
party further irrevocably submits to the jurisdiction of any such court in any
such action, suit or proceeding. Any and all service of process and any other
notice in any such action, suit or proceeding shall be effective against either
party if given by registered or certified mail, return receipt requested or by
any other means of mail which requires a signed receipt, postage prepaid,
mailed to such party at the address listed in Section 11.03 herein.
11.12 CAPTIONS. The captions in this Agreement are for convenience of
reference only and shall not limit or otherwise affect any of the terms or
provisions hereof.
11.13 COUNTERPARTS. This Agreement may be executed in counterparts,
each of which shall be deemed an original, and all of which together shall
constitute one and the same instrument.
11.14 ADDITIONAL AGREEMENTS. Subject to the terms and conditions
herein provided, each of the parties hereto agrees to use all commercially
reasonable efforts to take, or cause to be taken, all actions and to do, or to
cause to be done, all things necessary, proper or advisable to consummate and
to make effective as promptly as practicable the transactions contemplated by
this
37
Agreement, including without limitation using all commercially reasonable
efforts to obtain all necessary waivers, consents and approvals and to effect
all necessary registrations and filings.
11.15 BULK SALES COMPLIANCE. The parties hereto waive compliance with
all applicable provisions, if any, of the bulk sales Laws of the states in
which the Assets are located, or similar Laws of any jurisdiction, and the
Selling Entities agree to indemnify Purchaser against all Damages arising out
of such noncompliance or otherwise for any claims made against Purchaser by any
creditor of the Selling Entities asserted against or incurred by Purchaser by
reason of or resulting from such waiver.
11.16 SURVIVAL OF REPRESENTATIONS, WARRANTIES AND COVENANTS. All
representations, warranties and covenants of the parties contained in this
Agreement or in the Selling Entities' Disclosure Letter and the Purchaser's
Disclosure Letter shall survive the execution and delivery of this Agreement
and consummation of the transactions provided for in this Agreement and any
related agreements, notwithstanding any investigation made by or on behalf of
the parties, but with the exception of Sections 4.02, 5.02, 5.03, 5.05, 5.09
and 7.11, the representations, warranties and covenants shall terminate and be
of no further force or effect on the second anniversary of the Closing Date,
except that any such representation, warranty or covenant as to which a bona
fide claim thereto is asserted during such survival period shall, with respect
to such claim, survive such survival period. The representations, warranties
and covenants contained in Sections 4.02, 5.02, 5.03, 5.05 and 5.09 shall have
no termination date, and the covenant contained in Section 7.11 shall terminate
on the second anniversary of the Closing Date. No representation, warranty or
covenant shall merge into any acts of sale, bills of sale, assignments,
documents, agreements and instruments to be delivered at Closing.
11.17 RISK OF LOSS. The risk of any loss, damage, impairment,
confiscation or condemnation of the Assets, or any part thereof, shall be upon
the Selling Entities at all times prior to the Closing. In any such event, the
proceeds of, or any claim for any loss payable under any insurance policy,
judgment or award with respect thereto shall be payable to the Selling
Entities. In such event, the Selling Entities shall either: (i) repair,
replace or restore any such property as soon as possible after its loss,
impairment, confiscation or condemnation; or (ii) if insurance proceeds are
sufficient to repair, replace or restore the property, pay such proceeds to
Purchaser on the Closing Date; provided that in the event of damage that would
have a material adverse effect on the Business or the Assets taken as a whole,
either party may, by written notice made pursuant to Section 11.03, terminate
this Agreement.
11.18 PARENT GUARANTY. Parent is executing this Agreement to guaranty
the performance of Purchaser under this Agreement, any agreement executed
pursuant to this Agreement and under the Assigned Contracts. Parent guarantees
unconditionally and as a primary obligation that Purchaser shall perform all
its obligations and assume all its liabilities contained in this Agreement, any
agreement executed pursuant to this Agreement and under the Assigned Contracts.
If the Purchaser fails to perform any such obligations and liabilities, the
Parent shall upon the written request of the Selling Entities, immediately
perform such obligations. This guaranty shall apply regardless of any
amendments, variations, alterations, waivers or extensions to this Agreement,
any
38
agreement executed pursuant to this Agreement and the Assigned Contracts,
whether or not Parent received notice of the same and Parent waives all need
for notice of the same.
ARTICLE XII
TERMINATION
12.01 TERMINATION RIGHTS. This Agreement and the transactions
contemplated hereby may be terminated at any time prior to the Closing:
(a) by mutual agreement as evidenced by execution and delivery of a
written agreement to that effect by duly authorized officers of Purchaser and
the Selling Entities;
(b) by written notice given by one of the parties hereto to the
other party hereto if the Closing hereunder has not occurred by December 31,
1997, through no fault of the party providing said notice;
(c) by notice pursuant to Sections 11.17 or 12.02;
(d) by Purchaser if the representations and warranties of the
Selling Entities shall not be true and correct in all material respects when
made and at and as of the date of termination of this Agreement by Purchaser,
except for changes permitted or contemplated by this Agreement, or if either of
the Selling Entities fails to comply in any material respect with any of its
covenants or agreement contained herein; or
(e) by the Selling Entities if the representations and warranties of
Purchaser shall not be true and correct in all material respects when made and
at and as of the date of termination of this Agreement by the Selling Entities,
except for changes permitted or contemplated by this Agreement, or if Purchaser
fails to comply in any material respect with any of its covenants or agreements
contained herein.
The parties agree that prior to terminating this Agreement pursuant to
Sections 12.01(d) or (e), the non-defaulting party shall give the defaulting
party written notice of the default and the defaulting party shall have ten
(10) days to cure such default.
12.02 PERFORMANCE EXCUSED. The Selling Entities and Purchaser
shall be excused from performance of this Agreement to the extent required by
the order or judgment of any court or administrative body prohibiting or
delaying performance by any of the parties. In the event Closing is delayed
beyond February 28, 1998 by such court or administrative body, either party
may terminate this Agreement upon three (3) days' written notice to the
other, and the parties shall have no further obligation or liability to each
other thereafter under this Agreement.
39
12.03 CONTINUING OBLIGATIONS. Any termination pursuant to this
Article XII shall not affect the obligations of the parties hereto under
Sections 11.04, 11.05 and 11.11 hereof.
IN WITNESS WHEREOF, this Purchase and Sale Agreement has been duly executed and
delivered by the duly authorized officers of the parties hereto as of the date
first above written.
SELLER: SELLER'S AFFILIATE:
▇▇▇▇▇ & ROOT, INC., HALLIBURTON NUS CORPORATION,
a Delaware corporation a Delaware corporation
By:_________________________ By:_________________________
▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇
Attorney-in-Fact Attorney-in-Fact
PARENT: PURCHASER:
TETRA TECH, INC., NUS ACQUISITION CORP.,
a Delaware corporation a Delaware corporation
By:_________________________ By:_________________________
Li-San Hwang Li-San Hwang
Chief Executive Officer and Chief Executive Officer
President and President
40
EXHIBIT A
TO
PURCHASE AND SALE AGREEMENT BY AND AMONG
▇▇▇▇▇ & ROOT, INC., HALLIBURTON NUS CORPORATION AND
NUS ACQUISITION CORP. AND TETRA TECH, INC.
FORM OF ▇▇▇▇ OF SALE, ASSIGNMENT
AND ASSUMPTION AGREEMENT
▇▇▇▇ OF SALE, ASSIGNMENT AND ASSUMPTION AGREEMENT ("▇▇▇▇ OF SALE") dated
______________________, 1997, by and between ▇▇▇▇▇ & Root, Inc. ("SELLER"),
Halliburton NUS Corporation ("SELLER'S AFFILIATE"), NUS Acquisition Corp.
("PURCHASER") and Tetra Tech, Inc. ("PARENT").
The Purchaser desires to buy and the Seller and Seller's Affiliate
(collectively the "SELLING ENTITIES") desire to sell, on the terms and
conditions set forth herein, certain assets and properties exclusively related
to or exclusively used or held for use in connection with the Selling Entities'
business of providing consulting, engineering and design services with respect
to contamination of air, water and soil and environmental remediation services
(the "BUSINESS"), conditioned upon the assumption of certain liabilities
arising out of the Business by the Purchaser and the guaranty of the
liabilities assumed by the Purchaser by the Parent.
All terms used but not defined herein shall have the meanings ascribed
thereto in the Purchase and Sale Agreement, dated as of the 18th day of
October, 1997, by and among the Seller, Seller's Affiliate, the Purchaser and
the Parent (the "AGREEMENT"). Schedule references are to Schedules to the
Selling Entities' Disclosure Letter. This ▇▇▇▇ of Sale is being executed and
delivered in order to effect the transfer of Assets to, and the assumption of
the Assumed Liabilities by, the Purchaser, all as provided for in the
Agreement.
NOW, THEREFORE, in consideration of the Estimated Purchase Price paid by
the Purchaser to the Selling Entities and the assumption of the Assumed
Liabilities by the Purchaser, the receipt and sufficiency of which by each
Purchaser and Selling Entities is hereby acknowledged:
1.0 ASSIGNMENT. Selling Entities hereby sell, convey, transfer, assign
and deliver unto the Purchaser, its successors and assigns, all of Selling
Entities' right, title and interest in and to the properties, assets, and
rights of every kind and description and wherever located, whether tangible,
intangible, real, personal, or mixed, whether accrued, contingent or otherwise
(except the Excluded Assets), exclusively related to or exclusively used or
held for use in connection with the Business (the "ASSETS"), including, without
limitation, all of those items in the following categories used by the Selling
Entities exclusively in connection with the Business that conform to the
designation therein (except the Excluded Assets, as defined in Paragraph 2.0
hereof), as the same exist on the date hereof:
(1) FIXED ASSETS. All tangible personal property of the Business,
including, without limitation, all machinery, equipment, tools and supplies and
furniture, in each case listed on Schedule 2.01 (a)(1) (the "FIXED ASSETS").
(2) INVENTORY. All inventory of the Business, including, without
limitation, inventory items purchased but not received for which accounts
payable invoice amounts are included in Assumed Liabilities on the Final
Closing Balance Sheet, the latest available lists of which are summarized on
Schedule 2.01 (a)(2) (the "INVENTORY").
(3) ASSIGNED CONTRACTS. All rights under the contracts, agreements,
leases, sales orders, purchase orders, and other arrangements and commitments
of the Business, including, without limitation, those listed in Schedule
2.01(a)(3) (collectively, the "ASSIGNED CONTRACTS"), subject to Section 2.03 of
the Agreement and except for those contracts, agreements and commitments which
are listed in Schedule 2.01(b)(9) as Excluded Assets.
(4) INTELLECTUAL PROPERTY. All of Selling Entities' rights, title
and interest in and to all foreign and domestic patents, patent applications,
trademarks and service marks (common law and registered), all trademark and
service ▇▇▇▇ applications, trade names, copyrights, copyright registrations,
copyright applications, proprietary and technical information, trade secrets,
processes and know-how, including, without limitation, all engineering
drawings, laboratory books, notebooks, and journals and quality control
manuals, which are used exclusively in the Business, except for such property
which comes within the description of Excluded Assets (collectively,
"INTELLECTUAL PROPERTY").
(5) BOOKS AND RECORDS. Originals or copies of all books and records
(other than personnel records) and all files, including without limitation,
documents, papers, agreements, drawings, designs, plans, methods, engineering
and manufacturing specifications, formulas, procedures, computer programs and
customer lists which relate exclusively to the Assets or are used exclusively
in connection with the Assets or the Business, but excluding those related to
the Excluded Assets.
(6) MOTOR VEHICLES. All trucks, automobiles and other motor
vehicles owned by the Selling Entities, listed on Schedule 2.01(a)(6)(i), and
all rights of the Selling Entities to such motor vehicles leased by the Selling
Entities, listed on Schedule 2.01(a)(6)(ii).
(7) PERMITS AND LICENSES. All transferable business licenses,
permits, and equivalent documents, which relate exclusively to the operations
of the Business, listed on Schedule 2.01(a)(7).
2
(8) ACCOUNTS RECEIVABLE. All accounts receivable (excluding
employee accounts receivable described in Section 2.01(b)(1) of the Agreement
and Retained Accounts Receivable described in Section 2.01(b)(10) of the
Agreement) and all sums due for services performed or equipment provided by the
Selling Entities prior to the Closing including, if any, unbilled receivables
as of the Closing Date.
(9) NAME "NUS". Seller's Affiliate's right, title, interest in and
use of the name or trade name "NUS" and all goodwill associated with the name,
provided that Purchaser may not use the names "Halliburton" and "▇▇▇▇▇ & Root"
in connection therewith or represent any relationship whatsoever with the name
"Halliburton" and/or "▇▇▇▇▇ & Root".
(10) OTHER ASSETS. Any other asset, financial or otherwise, that is
reflected in the Final Closing Balance Sheet or any other assets or rights
expressly provided for elsewhere in the Agreement.
TO HAVE AND TO HOLD, all and singular, the Assets and properties hereby
sold, conveyed, transferred, assigned and delivered, or intended so to be, unto
the Purchaser, and its successors and assigns, to and for its own use forever.
2.0 ASSETS NOT TRANSFERRED. Notwithstanding anything to the contrary
contained herein, the following assets and properties of Selling Entities are
specifically excluded from the Assets and shall be retained by Selling Entities
("EXCLUDED ASSETS"):
(1) CASH, CASH EQUIVALENTS AND EMPLOYEE ACCOUNTS RECEIVABLE. All
cash on hand and cash equivalents, including, without limitation, bank accounts
and temporary cash investments, and all accounts receivable due from any
employees of the Selling Entities.
(2) REFUND CLAIMS. All claims of the Selling Entities for refunds
of taxes and other governmental charges for periods ending on or prior to the
Closing Date and the benefit, if any, of net operating loss carry-forwards or
carry-backs of the Selling Entities.
(3) THIRD PARTY CLAIMS. Except as provided in Section 11.17 of the
Agreement, all claims or rights of the Selling Entities, if any, against third
parties based on facts or events occurring prior to the Closing Date and which
are not reflected on the Final Closing Balance Sheet.
(4) INSURANCE. Except as provided in Section 11.17 of the
Agreement, all insurance policies and rights thereunder, including rights to
any cancellation value on the Closing Date.
(5) UNRELATED CONFIDENTIAL INFORMATION AND CERTAIN PROCESSES. All
proprietary or confidential business or technical information, intellectual
property, records and policies which relate to the Selling Entities or the
Selling Entities' other lines of business and are not used exclusively in the
Business.
3
(6) THE SELLING ENTITIES' MARKS AND PROPRIETARY SYSTEMS AND
PROCEDURES. All marks of the Selling Entities or the Selling Entities'
Affiliates, including, without limitation, any and all trademarks or service
marks, trade names, slogans or other like property relating to or including the
names Halliburton Company, ▇▇▇▇▇ & Root, Inc. or Halliburton NUS Corporation;
the marks Halliburton, ▇▇▇▇▇ & Root, ▇▇▇▇▇ & Root Environmental, Halliburton
NUS Corporation, HNUS, Halliburton NUS or Halliburton NUS Environmental
Corporation, or any derivatives or variations thereof; the Halliburton Company,
▇▇▇▇▇ & Root, Inc. or Halliburton NUS Corporation logos, or any derivatives
thereof, and the Selling Entities' proprietary computer programs or other
software not used exclusively in the Business.
(7) UNRELATED ASSETS. All assets of the Selling Entities not
exclusively used in connection with the Business, including, without
limitation, assets used by the Selling Entities primarily in their other
businesses, whether or not used for the benefit of the Business and those
assets listed on Schedule 2.01(b)(7).
(8) EXCLUDED PERSONAL PROPERTY. The tangible personal property,
equipment, vehicles and inventory listed on Schedule 2.01(b)(8).
(9) CONTRACTS NOT ASSIGNED. Those agreements, commitments and other
contracts listed on Schedule 2.01(b)(9).
(10) RETAINED ACCOUNTS RECEIVABLE. Underground storage tank accounts
receivable, government rate adjustment accounts receivable, accounts receivable
which have been written off the books of the Selling Entities and all other
accounts receivable retained by the Selling Entities, and any mortgages, deeds
of trust, mechanics and materialmen liens, security interests, pledges, and any
other lien or charge of any type in favor of the Selling Entities and securing
the payment of such accounts receivable, all of which are listed in Schedule
2.01(b)(10).
(11) AFFILIATE ACCOUNTS. All intercompany accounts between Seller,
Seller's Affiliate and their Affiliates.
(12) SELLING ENTITIES' EMPLOYEE BENEFIT PLANS. All assets related to
all employee benefit plans, as defined in Section 3(3) of the Employee
Retirement Income Security Act of 1974 ("ERISA") and all other profit sharing,
deferred compensation, bonus, stock option, stock purchase, stock bonus,
vacation pay, holiday pay, severance, dependent care assistance, excess
benefit, incentive compensation, salary continuation, medical, life or other
insurance, supplemental unemployment and other compensation or employee benefit
plans, programs, agreements or arrangements, whether funded or unfunded,
maintained or contributed to by the Selling Entities or any Affiliate of the
Selling Entities for the benefit of its employees (or former employees) and/or
their beneficiaries relating to the Selling Entities or their employees (the
"SELLING ENTITIES' EMPLOYEE BENEFIT PLANS").
(13) RETAINED PATENTS. The Patents described on Schedule
2.01(b)(13).
3.0 ASSUMPTION OF LIABILITIES BY THE PURCHASER.
4
3.1 ASSUMED LIABILITIES. In consideration of the sale, conveyance,
transfer, assignment and delivery of the Assets by the Selling Entities to the
Purchaser, its successors and assigns, the Purchaser hereby assumes and agrees
to pay, honor and discharge in accordance with the terms thereof all of the
Assumed Liabilities. The term "ASSUMED LIABILITIES" shall mean only the
following liabilities and obligations relating to the Business or the Assets:
3.1.1 ASSIGNED CONTRACTS. Any and all liabilities,
obligations and commitments of the Business that arise out of or relate to the
Assigned Contracts listed on Schedule 2.01(a)(3), but in any case, not
including any liability for any breach thereof occurring prior to the Closing
Date.
3.1.2 TAXES. Any and all taxes which may be applicable to
the Business or Assets with respect to periods beginning with the Closing Date,
or arising from events or occurrences on or after the Closing Date, including
without limitation, income, ad valorem, personal property, sales, value added,
goods and services, use or transfer taxes resulting from the sale of the Assets
to Purchaser and/or the Purchaser's ownership of the Assets. The burden of ad
valorem taxes, real property taxes, personal property taxes and other similar
taxes for the tax year in which the Closing occurs based on the ownership of
the Assets shall be prorated based on the Selling Entities' and Purchaser's
respective ownership of the Assets during the tax year in which the Closing
occurs. Any sum required to be paid by one party to the other as a result of
such proration shall be paid by wire transfer of immediately available funds.
3.1.3 SPECIFIC UNDERTAKINGS. Any and all liabilities,
obligations and commitments specifically undertaken by the Purchaser pursuant
to the other terms of the Agreement.
3.1.4 BALANCE SHEET LIABILITIES. Any and all liabilities
included on the Final Closing Balance Sheet, including, without limitation, all
accounts payable.
3.1.5 PRODUCT LIABILITIES. Subject to the Selling Entities'
reimbursement obligations under Section 6.04 of the Agreement, all risks
associated with the use following the Closing Date of any equipment purchased
hereunder as part of the Assets, including liability to any third party for any
injury or damage to persons or property and any damage to the equipment itself,
due to any condition of, defect in or design of the equipment, latent or
otherwise, whether such condition, defect or design now exists or hereafter
occurs.
3.1.6 CERTAIN OTHER COSTS AND OBLIGATIONS. Any and all
costs and obligations, whether direct or indirect including, without
limitation, administrative costs, related to any unassigned contract or claim
of which the Purchaser obtains the benefit pursuant to Section 2.03 of the
Agreement, excluding any and all costs of the Selling Entities associated with
novation.
3.2 PERFORMANCE BONDS. The Purchaser shall obtain replacement
Performance Bonds as required by Section 3.04(f) of the Agreement.
5
3.3 EXCLUDED LIABILITIES. The Purchaser shall not assume and shall
not be responsible for any liabilities, obligations or commitments of the
Selling Entities other than the Assumed Liabilities (the "EXCLUDED
LIABILITIES").
3.4 SHARED LIABILITIES. Liabilities relating to the Business for
utility charges or with respect to rentals payable on leased property included
as part of the Assets, which in either case are for periods beginning before
and ending after the Closing Date, shall be shared by the Selling Entities and
Purchaser on the basis of the proportionate number of calendar days in such
period.
4.0 POWER OF ATTORNEY. Selling Entities hereby irrevocably constitute
and appoint the Purchaser as their true and lawful attorney in fact with full
power of substitution, in the name of the Selling Entities, or either of them,
or otherwise, and on behalf and for the benefit of the Purchaser (1) to collect
for the account of the Purchaser all accounts receivable and other items to be
transferred to the Purchaser as provided herein; (2) to endorse checks received
in connection therewith; (3) to demand and receive the properties and assets
conveyed or transferred hereby, or intended to be so; (4) to give receipts,
releases and acquittances for and in respect of the same or any part thereof;
(5) to institute and prosecute in the name of the Selling Entities, or
otherwise, but at the expense and for the benefit of the Purchaser, any and all
proceedings at law or in equity or otherwise, which the Purchaser may deem
proper to collect, assert or enforce with respect to any claim, title, right,
debt or account hereby transferred and assigned or intended to be so; (6) to
defend and compromise any and all actions, writs or proceedings in respect of
any of the properties and assets hereby assigned and transferred or intended so
to be, which the Purchaser shall deem desirable; and (7) to do all such other
acts and things in relation to the properties and assets hereby assigned and
transferred as the Purchaser shall deem advisable. The Selling Entities agree
that the foregoing powers are coupled with an interest and shall be irrevocable
by the Selling Entities for any reason. The Selling Entities further agree
that the Purchaser shall retain for its own account any amounts collected
pursuant to the foregoing powers (other than Uncollected Receivables assigned
to the Selling Entities), including any sums payable as interest in respect
thereof, and the Selling Entities agree to pay to the Purchaser, when received,
any amounts which shall be received by the Selling Entities in respect of any
accounts receivable or other assets or property to be sold to the Purchaser as
provided herein.
5.0 FURTHER ASSURANCES. The Selling Entities covenant and agree with the
Purchaser that the Selling Entities will, whenever and as often as required to
do so by the Purchaser, execute, acknowledge and deliver any and all such other
deeds, assignments, transfers, conveyances, confirmations, powers of attorney,
and any instruments of further assurance, approval and consent, and take such
other action as the Purchaser may hereafter reasonably deem necessary or proper
in order to complete or perfect the conveyance and transfer to the Purchaser of
the assets, properties and rights conveyed and transferred hereby or intended
to be so conveyed and transferred.
6
6.0 BINDING INSTRUMENT. This instrument shall be binding on the parties
hereto and their respective successors and assigns. Nothing in this
instrument, express or implied, is intended to confer upon any person other
than the foregoing, any rights, remedies, obligations or liabilities under or
by reason of this instrument, except as expressly provided herein.
7.0 FURTHER BILLS OF SALE. The Selling Entities and the Purchaser shall
execute such further individual bills of sale and assignment and assumption
agreements as may be appropriate to effect the transfer of specific Assets to
the Purchaser from the Selling Entities. The Selling Entities and the
Purchaser specifically recognize that, with regard to this ▇▇▇▇ of Sale, such
further bills of sale and assignment and assumption agreements shall be deemed
to be corrective bills of sale and assignment and assumption agreements to the
extent that they purport to convey the same Assets as are covered by this ▇▇▇▇
of Sale and to such extent shall be deemed to have replaced this ▇▇▇▇ of Sale
without requiring the parties to specifically amend this ▇▇▇▇ of Sale. Except
as provided in this Paragraph 7.0, this ▇▇▇▇ of Sale shall continue in full
force and effect without change.
8.0 COUNTERPARTS. This ▇▇▇▇ of Sale may be executed in counterparts,
each of which shall be deemed an original, and all of which together shall
constitute one and the same instrument.
9.0 PARENT GUARANTY. The Parent is executing this ▇▇▇▇ of Sale to
evidence its guaranty of the obligations of the Purchaser hereunder.
IN WITNESS WHEREOF, the Purchaser, Parent and the Selling Entities have
caused this ▇▇▇▇ of Sale to be executed in their respective corporate names by
their respective, duly authorized officers on and as of the day and year first
written above.
▇▇▇▇▇ & ROOT, INC. NUS ACQUISITION CORP.
By:____________________________ By:____________________________
(Name) (Name)
(Title) (Title)
HALLIBURTON NUS CORPORATION TETRA TECH, INC.
By:____________________________ By:____________________________
(Name) (Name)
(Title) (Title)
7
STATE OF TEXAS )
COUNTY OF ▇▇▇▇▇▇ )
BEFORE ME, the undersigned, a Notary Public in and for said State, on this
day personally appeared _________________, the ________________________ of
▇▇▇▇▇ & Root, Inc., a Delaware corporation, known to me to be the person and
officer whose name is subscribed to the foregoing instrument and acknowledged
to me that he executed the same for the purposes and consideration therein
expressed, and in the capacity therein stated.
IN WITNESS WHEREOF, I have hereunto set my hand and seal this ____ day of
_____________, 1997.
_________________________________
[SEAL] Notary Public
My commission expires: _____________
STATE OF TEXAS )
COUNTY OF ▇▇▇▇▇▇ )
BEFORE ME, the undersigned, a Notary Public in and for said State, on this
day personally appeared _________________, the ________________________ of
Halliburton NUS Corporation, a Delaware corporation, known to me to be the
person and officer whose name is subscribed to the foregoing instrument and
acknowledged to me that he executed the same for the purposes and consideration
therein expressed, and in the capacity therein stated.
IN WITNESS WHEREOF, I have hereunto set my hand and seal this ____ day of
_____________, 1997.
.
_________________________________
[SEAL] Notary Public
My commission expires: _____________
8
STATE OF ___________)
COUNTY OF __________)
BEFORE ME, the undersigned, a Notary Public in and for said State, on this
day personally appeared _________________, the ________________________ of NUS
Acquisition Corp., a Delaware corporation, known to me to be the person and
officer whose name is subscribed to the foregoing instrument and acknowledged
to me that he executed the same for the purposes and consideration therein
expressed, and in the capacity therein stated.
IN WITNESS WHEREOF, I have hereunto set my hand and seal this ____ day of
_____________, 1997.
_________________________________
[SEAL] Notary Public
My commission expires: _____________
STATE OF ___________)
COUNTY OF __________)
BEFORE ME, the undersigned, a Notary Public in and for said State, on this
day personally appeared _________________, the ________________________ of
Tetra Tech, Inc., a Delaware corporation, known to me to be the person and
officer whose name is subscribed to the foregoing instrument and acknowledged
to me that he executed the same for the purposes and consideration therein
expressed, and in the capacity therein stated.
IN WITNESS WHEREOF, I have hereunto set my hand and seal this ____ day of
_____________, 1997.
_________________________________
[SEAL] Notary Public
My commission expires: _____________
9
EXHIBIT B -- CONFIDENTIALITY AGREEMENT
▇▇▇▇▇▇, READ & CO. INC.
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇-▇▇▇-▇▇▇▇
August 5, 1997
STRICTLY PRIVATE AND CONFIDENTIAL
Tetra Tech, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Re: CONFIDENTIALITY AGREEMENT
Attention: ▇▇. ▇▇-San ▇▇▇▇▇
Gentlemen:
▇▇▇▇▇▇, Read & Co. Inc. ("▇▇▇▇▇▇ Read") has been retained by ▇▇▇▇▇ &
Root, Inc. ("B&R") to explore the possible sale of its Environmental Services
business (the "Environmental Business") principally operated by B&R's
subsidiary, Halliburton NUS Corporation ("HNUS"). You have requested
information concerning the Environmental Business in connection with your
investigation.
▇▇▇▇▇▇ Read is furnishing to you oral and written information on behalf
of B&R and HNUS, and may furnish additional information in the future, that
B&R and HNUS consider confidential. By accepting such information, you agree
that any information that may be furnished to you by officers, directors,
employees, agents or financial advisors of B&R or HNUS will be kept
confidential. In no event shall you use such information to the detriment of
B&R nor HNUS. You agree to provide such material only to responsible
officers, employees or agents (including your outside legal counsel,
accountants, sources of financing and financial advisors) of your company
hereinafter referred to as "Representatives" (all of whom shall be informed
by you of this Agreement and shall agree to be bound by the terms hereof),
for the exclusive purpose of evaluating a possible acquisition transaction,
and you shall be responsible for compliance with the terms of this Agreement
by all such persons to whom you provide such information.
You agree not to make such material available to any other person or group
as defined above for any other purpose whatsoever. You further agree that
without B&R's prior written consent, you will not disclose to any person the
fact that you have requested confidential information regarding the
Environmental Business, or that discussions or negotiations are taking place
concerning a possible acquisition transaction involving you and B&R and HNUS or
the status thereof, unless, in the opinion of your counsel, such disclosure is
required by the United States securities laws (in which case you shall notify
B&R and its counsel prior to any disclosure you propose to make concerning the
reasons for, and nature of, your proposed disclosure).
In the event that you are requested in any proceeding to disclose any
material concerning the Environmental Business, you will give B&R prompt notice
of such request so that B&R may seek an appropriate protective order. If in
the absence of a protective order you are nonetheless compelled to disclose
material concerning the Environmental Business, you may disclose such
information without liability hereunder; provided, however, that you give B&R
written notice of the information to be disclosed as far in advance of its
disclosure as is practicable and, upon B&R's request and at B&R's expense, use
your best efforts to obtain assurances that confidential treatment will be
accorded to such information.
In the event that you do not make an acquisition proposal or offer, or an
acquisition transaction does not proceed for any other reason, you agree upon
the request of B&R or ▇▇▇▇▇▇ Read to return all information furnished to you
and any copies thereof and to destroy any notes, extracts or analyses which are
based upon or derived from such information. Your obligations under the
Agreement shall survive the return or destruction of such information and shall
expire on the third anniversary of the date of this Agreement.
The foregoing restrictions with respect to information furnished to you
shall not apply to any information which you demonstrate (i) becomes generally
available to the public other than as a result of a disclosure by you or your
representatives, (ii) was available to you on a non-confidential basis prior to
its disclosure to you by B&R, HNUS or their representatives or (iii) becomes
available to you on a non-confidential basis from a source other than B&R, HNUS
or their representatives, which source was not itself bound by a
confidentiality agreement with B&R, HNUS or their representatives.
You further agree that for a period of two years from the date of this
Agreement, your "Representatives" will not, without the prior written approval
of HNUS or B&R, as applicable, directly or indirectly solicit for employment or
hire any person who is now employed in an executive, managerial, marketing or
technical role by HNUS or by B&R in the Environmental Business, who comes to
your attention in connection with your evaluation of HNUS.
You agree that money damages would not be a sufficient remedy for any
breach of this agreement by you or your directors, officers, employees and
agents, and that in addition to all other remedies, B&R and HNUS shall be
entitled to specific performance and injunctive or other equitable relief as a
remedy for any such breach, and you further agree to waive, and to use your
best efforts to cause your directors, officers, employees or agents to waive,
any requirements for the securing or posting of any bond in connection with
such remedy.
You understand that none of B&R, HNUS or ▇▇▇▇▇▇ Read makes any
representation or warranty as to the accuracy or completeness of any of the
information provided to you. Further, you hereby agree that B&R, HNUS and
their representatives shall have no liability hereunder to you or any of you
representatives for any representations, express or implied, contained in such
information, except as may be provided in any subsequent definitive agreement.
You agree that this Agreement will be governed by and construed in
accordance with the laws of the State of Texas without regard to its choice of
law principles. You hereby irrevocably and unconditionally consent to submit
to the jurisdiction of the courts of the United States of America for the
Southern District of Texas or the courts of the State of Texas located in
▇▇▇▇▇▇ County, Texas for any action, suit or proceeding arising out of or
related to this Agreement (and you agree not to commence any action, suit or
proceeding relating thereto except in such courts) and further agree that
service of process, summons, notice or document by U.S. registered mail to your
address set forth above shall be effective service of process for any action,
suit or proceeding brought against you in any such court.
You acknowledge that this Agreement, in addition to being for the benefit
of ▇▇▇▇▇▇ Read, is for the benefit of B&R and HNUS and you agree that any
action, suit or proceeding for the enforcement of the terms of this Agreement
may be brought by B&R or HNUS without the necessity of any joinder therein by
▇▇▇▇▇▇ Read and you expressly waive any claim that there is a lack of privity
of contract between you and B&R and HNUS and, that, as a consequence thereof,
B&R and HNUS have no standing to bring an action with respect to this
Agreement.
If the foregoing is acceptable, please execute this Agreement in the space
provided below and return one copy to ▇▇▇▇▇▇ Read.
Sincerely,
▇▇▇▇▇▇, READ & CO. INC.
By: ______________________
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Vice President
Accepted and agreed to as
of the date written below:
By: ______________________
Date: ____________________
EXHIBIT C
ASSIGNMENT OF LEASE
Agreement made this ___ day of _____________, 1997, between [▇▇▇▇▇ & Root,
Inc.] [Halliburton NUS Corporation], with offices at ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇▇▇, ▇▇▇▇▇, ▇▇▇▇▇, hereinafter called Assignor, and NUS Acquisition Corp.,
with offices at ▇▇▇ ▇. ▇▇▇▇▇▇▇▇ ▇▇▇▇., ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, hereinafter
called Assignee;
WITNESSETH:
IN CONSIDERATION of the sum of one dollar ($1.00) and other good and
valuable consideration paid by Assignee to Assignor, the receipt of which is
hereby acknowledged, Assignor hereby assign to Assignee, its successors and
assigns, effective the date hereof, all its right, title and interest in and to
that certain [Lease Agreement] between ______________________ as [Landlord],
and Assignor, as Tenant, a copy of which is attached hereto as Exhibit A;
TO HAVE AND TO HOLD the same for the unexpired term of said [Lease
Agreement], and any extensions thereof, subject to the payment of the rent and
the performance of the covenants, conditions and stipulations contained therein
and in any amendments thereto.
Assignee covenants to pay the rents reserved and to perform the covenants,
conditions and stipulations in said [Lease Agreement], as amended, to be
performed by Tenant, and Assignor is hereby released from any and all
obligations and liabilities therefor arising from and after the date hereof.
IN WITNESS WHEREOF, the parties hereto have signed and delivered this
instrument on the day and year first above written.
Assignor: Assignee:
___________________________ ___________________________
By: _______________________ By:________________________
Title:_____________________ Title:_______________________
ACCEPTED AND AGREED TO
this ____ day of ___________, 1997
___________________________
By: _______________________
Title:_____________________
STATE OF TEXAS )
)
COUNTY OF _____ )
On this ___ day of _________________, 1997, before me, a Notary Public in
and for said state, personally appeared _____________________,
______________________ of _____________________________ and acknowledged to me
that he executed the same for the purposes therein stated.
__________________________________
Notary Public, State of Texas
STATE OF TEXAS )
)
COUNTY OF _____ )
On this ___ day of _________________, 1997, before me, a Notary Public in
and for said state, personally appeared _____________________,
______________________ of NUS Acquisition Corp. and acknowledged to me that he
executed the same for the purposes therein stated.
__________________________________
Notary Public, State of Texas
EXHIBIT D - FINAL CLOSING BALANCE SHEET
NUS ENVIRONMENTAL
COMPARATIVE STATEMENT OF NET OPERATING ASSETS
(UNAUDITED)
ASSETS
------
Cash
Trade Accounts Receivable, Less Allowance
for Doubtful Accounts
Retainage
Notes Receivable
Unbilled Work on Uncompleted Contracts
Inventory of Small Tools
Other Current Assets
Total Current Assets
Property, Plant and Equipment at Cost
Less: Accumulated Depreciation
Total Property, Plant and Equipment
Total Assets
LIABILITIES AND EQUITY
----------------------
Accounts Payable and Accruals
Advance ▇▇▇▇▇▇▇▇ on Uncompleted Contracts
Current Maturities of Long Term Debt
Total Current Liabilities
Estimated Vacation Expense
Reserves and Contingencies
Total Deferred Credits and Reserves
Corporate Investment and Advances
Total Liabilities and Equity
EXHIBIT E - ADJUSTED JUNE BALANCE SHEET
NUS ENVIRONMENTAL
COMPARATIVE STATEMENT OF NET OPERATING ASSETS
(UNAUDITED)
JUNE
ASSETS 1997
------ ----
Cash -
Trade Accounts Receivable, Less Allowance
for Doubtful Accounts 16,867
Retainage 1,433
Notes Receivable 421
Unbilled Work on Uncompleted Contracts 11,798
Inventory of Small Tools 310
Other Current Assets 459
--------
Total Current Assets 31,288
Property, Plant and Equipment at Cost 6,508
Less: Accumulated Depreciation 5,479
--------
Total Property, Plant and Equipment 1,029
Total Assets 32,317
--------
--------
LIABILITIES AND EQUITY
----------------------
Accounts Payable and Accruals -
Advance ▇▇▇▇▇▇▇▇ on Uncompleted Contracts 2,670
Current Maturities of Long Term Debt -
--------
Total Current Liabilities 2,670
Estimated Vacation Expense -
Reserves and Contingencies 657
--------
Total Deferred Credits and Reserves 657
Corporate Investment and Advances 28,990
Total Liabilities and Equity 32,317
--------
--------
NUS ENVIRONMENTAL
STATEMENT OF OPERATIONS
EXHIBIT F - FINANCIAL STATEMENTS
JUNE
1994 1995 1996 1997
---- ---- ---- ----
REVENUE
REMEDIATION PROJECTS 6,978 11,422 7,350 3,192
NORTHEAST 48,405 46,446 39,270 23,896
SOUTH 49,017 50,027 44,226 18,184
ERTP 5,376 5,705 5,535 2,920
SITE SPECIFIC 4,036 5,069 4,235 1,160
-------------------------------------------
TOTAL REVENUE 113,812 118,669 100,616 49,351
JOB INCOME
REMEDIATION PROJECTS 19 5,520 577 46
NORTHEAST 10,753 10,322 8,717 4,441
SOUTH 11,380 10,924 8,431 3,674
ERTP (16) 88 (29) (67)
SITE SPECIFIC 1,975 3,456 2,991 492
-------------------------------------------
TOTAL JOB INCOME 24,111 30,310 20,687 8,583
OTHER JOB COST
REMEDIATION PROJECTS 9 (1,700) - (60)
NORTHEAST (4,016) (4,312) (3,860) (1,925)
SOUTH (3,891) (4,676) (5,660) (1,615)
ERTP 707 760 698 425
SITE SPECIFIC 2 (97) (60) (2)
--------------------------------------------
TOTAL OTHER JOB COST (7,189) (10,025) (8,882) (3,176)
JOB INCOME/LOSS
REMEDIATION PROJECTS 28 3,820 577 (13)
NORTHEAST 6,737 6,010 4,857 2,515
SOUTH 7,489 6,248 2,771 2,059
ERTP 691 848 669 357
SITE SPECIFIC 1,977 3,359 2,931 490
-------------------------------------------
TOTAL JOB INCOME/LOSS 16,922 20,285 11,805 5,408
OVERHEAD
REMEDIATION PROJECTS (1,909) (988) (1,856) (67)
NORTHEAST (1,941) (2,264) (1,616) (803)
SOUTH (982) (1,950) (1,036) (979)
ERTP - - - (81)
SITE SPECIFIC - - - -
SUB-UNIT O/H (8,274) (6,040) (4,028) (1,588)
--------------------------------------------
TOTAL OVERHEAD (13,106) (11,242) (8,536) (3,520)
▇▇▇
REMEDIATION PROJECTS (1,882) 2,832 (1,279) (80)
NORTHEAST 4,796 3,746 3,241 1,710
SOUTH 6,507 4,298 1,735 1,080
ERTP 691 848 669 276
SITE SPECIFIC 1,977 3,359 2,931 490
SUB-UNIT O/H (8,274) (6,040) (4,028) (1,588)
-------------------------------------------
TOTAL ▇▇▇ 3,816 9,043 3,269 1,889
ADJ. EXTRAORDINARY ITEMS:
WRITE-OFF SOIL SAW 1,700 1,370
SACRAMENTO SETTLEMENT (176) (4,425)
UST A/R RESERVES 2,000
-------------------------------------------
ADJUSTED ▇▇▇ 3,640 6,318 6,639 1,889
-------------------------------------------
-------------------------------------------
NORTHEAST_INCST
INCOME STATEMENT
JUNE
1993 1994 1995 1996 1997
---- ---- ---- ---- ----
REVENUE
NORTHEAST:
GAITHERSBURG 12,521 9,729 8,789 8,948 4,935
PITTSBURGH 16,414 24,052 23,443 21,417 11,708
PHILADELPHIA 6,456 5,118 5,600 4,468 3,935
BOSTON 11,458 6,563 4,911 2,775 2,689
LANSING 2,528 2,943 3,703 1,662 629
------- ------- ------- ------- -------
TOTAL REVENUE 49,377 48,405 46,446 39,270 23,896
JOB INCOME
NORTHEAST:
GAITHERSBURG 3,467 2,768 2,762 2,455 ▇▇▇
▇▇▇▇▇▇▇▇▇▇ 2,779 4,733 4,573 4,094 2,255
PHILADELPHIA 1,311 1,113 1,200 949 ▇▇▇
▇▇▇▇▇▇ 1,519 1,404 1,099 736 539
LANSING 625 735 688 483 128
------- ------- ------- ------- -------
TOTAL JOB INCOME 9,701 10,753 10,322 8,717 4,441
OTHER JOB COST
NORTHEAST:
PGH ADMIN - - - 12 3
FACILITY O/H - - - - (165)
GAITHERSBURG (1,047) (1,864) (1,395) (1,339) (811)
PITTSBURGH (1,070) (810) (1,632) (1,252) (391)
PHILADELPHIA (408) (685) (353) (560) (292)
BOSTON (381) (383) (720) (531) (180)
LANSING (313) (274) (212) (190) (89)
------- ------- ------- ------- -------
TOTAL OTHER JOB COST (3,219) (4,016) (4,312) (3,860) (1,925)
JOB INCOME/LOSS
NORTHEAST:
PGH ADMIN - - - 12 3
FACILITY O/H - - - - (165)
GAITHERSBURG 2,420 903 1,367 1,117 ▇▇▇
▇▇▇▇▇▇▇▇▇▇ 1,709 3,924 2,942 2,842 1,864
PHILADELPHIA 903 428 848 389 ▇▇▇
▇▇▇▇▇▇ 1,138 1,021 378 205 358
LANSING 312 461 477 293 39
------- ------- ------- ------- -------
TOTAL JOB INCOME/LOSS 6,482 6,737 6,010 4,857 2,515
OVERHEAD
NORTHEAST:
PGH ADMIN 333 633 577 483 276
SUPERFUND 3 273 483 100 6
GAITHERSBURG - 402 225 151 142
PITTSBURGH - 525 709 684 284
PHILADELPHIA - 76 107 140 58
BOSTON - 10 132 30 9
LANSING - 22 31 28 28
------- ------- ------- ------- -------
TOTAL OVERHEAD 336 1,941 2,264 1,616 803
Page 1
NORTHEAST_INCST
INCOME STATEMENT
JUNE
1993 1994 1995 1996 1997
---- ---- ---- ---- ----
REVENUE
▇▇▇
NORTHEAST:
PGH ADMIN (333) (633) (577) (471) (274)
SUPERFUND (3) (272) (483) (100) (6)
FACILITY O/H - - - - (165)
GAITHERSBURG 2,420 501 1,142 966 (32)
PITTSBURGH 1,709 3,399 2,233 2,158 1,580
PHILADELPHIA 903 352 741 249 ▇▇▇
▇▇▇▇▇▇ 1,138 1,012 246 175 349
LANSING 312 439 446 264 11
------- ------- ------- ------- -------
TOTAL ▇▇▇ 6,146 4,798 3,746 3,241 1,710
Page 2
SOUTH_INCST
INCOME STATEMENT
JUNE
1993 1994 1995 1996 1997
---- ---- ---- ---- ----
SOUTH:
ALBUQUERQUE 211 2,391 2,785 5,313 2,223
FLORIDA 4,000 8,881 9,968 7,139 3,909
OAKRIDGE/ATLANTA 11,403 11,911 13,416 10,213 4,626
HOUSTON 4,351 4,903 5,055 5,732 1,809
SAVANNAH RIVER CTR 22,559 20,931 18,803 15,829 5,617
---------------------------------------------------
TOTAL REVENUE 42,524 49,017 50,027 44,226 18,184
JOB INCOME
SOUTH:
ALBUQUERQUE 35 567 772 476 456
FLORIDA 754 2,324 2,169 1,326 ▇▇▇
▇▇▇▇▇▇▇▇/▇▇▇▇▇▇▇ 2,145 2,499 2,474 1,486 690
HOUSTON 35 1,028 843 886 477
SAVANNAH RIVER CTR 5,525 4,962 4,666 4,257 1,467
---------------------------------------------------
TOTAL JOB INCOME 8,494 11,380 10,924 8,431 3,674
OTHER JOB COST
SOUTH:
ALBUQUERQUE (54) (92) (392) (291) (91)
FLORIDA (448) (1,196) (1,429) (3,131) (511)
OAKRIDGE/ATLANTA (1,124) (1,198) (1,156) (757) (339)
HOUSTON (1,260) (481) (191) (289) (217)
SAVANNAH RIVER CTR (761) (924) (1,508) (1,192) (457)
----------------------------------------------------
TOTAL OTHER JOB COST (3,647) (3,891) (4,676) (5,660) (1,615)
JOB INCOME/LOSS
SOUTH:
ALBUQUERQUE (19) 475 380 185 364
FLORIDA 306 1,128 735 (1,805) 73
OAKRIDGE/ATLANTA 1,021 1,301 1,318 729 352
HOUSTON (1,225) 547 652 597 260
SAVANNAH RIVER CTR 4,764 4,038 3,158 3,065 1,010
---------------------------------------------------
TOTAL JOB INCOME/LOSS 4,847 7,489 6,248 2,771 2,059
OVERHEAD
SOUTH:
ALBUQUERQUE - 21 38 134 142
FLORIDA - 28 330 154 18
SO REG MGMT 242 427 988 - 208
OAKRIDGE/ATLANTA - 205 337 289 97
HOUSTON - 189 204 270 178
SAVANNAH RIVER CTR - 112 53 189 336
---------------------------------------------------
TOTAL OVERHEAD 242 982 1,950 1,036 979
Page 1
SOUTH_INCST
INCOME STATEMENT
JUNE
1993 1994 1995 1996 1997
---- ---- ---- ---- ----
▇▇▇
SOUTH:
ALBUQUERQUE (19) 454 343 51 222
FLORIDA 306 1,100 404 (1,959) 55
SO REG MGMT (242) (427) (988) - (208)
OAKRIDGE/ATLANTA 1,021 1,096 981 441 255
HOUSTON (1,225) 358 449 327 82
SAVANNAH RIVER CTR 4,764 3,926 3,105 2,876 674
---------------------------------------------------
TOTAL ▇▇▇ 4,605 6,507 4,298 1,735 1,080
Page 2
SUBUNIT_INCST
INCOME STATEMENT
JUNE
1993 1994 1995 1996 1997
---- ---- ---- ---- ----
▇▇▇
BID & PROPOSAL 406 2,477 3,116 1,031 589
GOV'T CNTR PRICING 1,090 735 438 367 113
PERSONNEL 451 459 274 111 1
NUS PENSION/PROFIT - 201 124 85 56
COMMON CMPTR CHGS 363 651 687 376 90
BUSINESS DEVELOPMENT 92 1,945 1,261 1,005 53
IDLE FACILITIES - - - 265 -
BRE MGMT SUPPORT 1,353 1,747 371 1,031 316
DOE BUS DEV 231 72 7 - -
G'BURG PROCUREMENT 105 369 413 363 41
HOUSTON PROCUREMENT - 233 192 1 -
CONTRACT ADMIN - - - 384 233
CONTRACT ▇▇▇▇▇-▇▇▇▇ ▇▇▇ - ▇▇▇ ▇ -
▇▇▇▇▇▇▇ CON ADM - 470 250 - -
SECURITY ADMIN - 6 - - -
TECHNICAL DIRECTOR 115 (2) - - -
BUS DEV-1320 36 320 - - -
ENV OPS O/H 2,486 31 - - -
FINANCE & ADMIN - 1,302 - - -
IT AQUISITION 808 10 - - -
GOV'T COMPLIANCE - - 237 194 96
GOV'T COMPLIANCE-1391 - - (11) - -
MARKETING - 811 695 - -
MENTOR/PROTEGE - 40 4 - -
MISC CORP ALLOC - 292 - - -
HOUSTON FACILITIES 64 41 - - -
LOBBYING COST - - 5 - -
---------------------------------------------
TOTAL ▇▇▇ 7,858 12,210 8,164 5,214 1,588
REVENUE SUPPORTED:
BRE 101,754 113,812 118,669 100,616
PGH LAB 5,068 6,118 4,877 1,902
NUS NUCLEAR 66,758 48,014 36,842 27,710
-------------------------------------
TOTAL REVENUE 173,580 167,944 160,388 130,228
BRE % 59% 68% 74% 77%
4,606 8,274 6,040 4,028
Page 2
NUS ENVIRONMENTAL
COMPARATIVE STATEMENT OF NET OPERATING ASSETS
(UNAUDITED)
JUNE
ASSETS 1995 1996 1997
------ ---- ---- ----
Cash - - -
Trade Accounts Receivable, Less Allowance
for Doubtful Accounts 18,839 17,107 16,867
Retainage 809 1,320 1,433
Notes Receivable 596 527 421
Unbilled Work on Uncompleted Contracts 21,247 16,287 11,798
Inventory of Small Tools 311 311 310
Other Current Assets 267 121 459
--------------------------------
Total Current Assets 42,069 35,673 31,288
Property, Plant and Equipment at Cost 8,153 7,069 6,508
Less: Accumulated Depreciation 4,811 5,146 5,479
-------------------------------
Total Property, Plant and Equipment 3,342 1,923 1,029
Total Assets 45,411 37,596 32,317
-------------------------------
-------------------------------
LIABILITIES AND EQUITY
----------------------
Accounts Payable and Accruals - - -
Advance ▇▇▇▇▇▇▇ on Uncompleted Contracts 3,508 4,704 2,670
Current Maturities of Long Term Debt - - -
-------------------------------
Total Current Liabilities 3,508 4,704 2,670
Estimated Vacation Expense -
Reserves and Contingencies 1,664 1,147 657
-------------------------------
Total Deferred Credits and Reserves 1,664 1,147 657
Corporate Investment and Advances 40,239 31,745 28,990
Total Liabilities and Equity 45,411 37,596 32,317
-------------------------------
-------------------------------
HALLIBURTON NUS CORPORATION
BALANCE SHEET
PERIOD ENDING DECEMBER 30, 1995
REDUCTIONS
PGH RESIDUAL PEN/PS CORPORATE
CO 080 LAB NUS RESERVES CRLAKE LAB RESERVE RCC
---------- --------- ---------- ---------- --------- ---------- ----------
ASSETS
------------------------------------
CASH ON HAND AND IN BANKS 3,735,717 200 (169,207)
TRADE ACCOUNTS RECEIVABLE, LESS
ALLOWANCE FOR DOUBTFUL ACCOUNTS 38,062,836 378,702 6,994,914 1,447
RETAINAGE 1,323,054 513,703
NOTES RECEIVABLES 726,486 666,450
EMPLOYEE RECEIVABLES 557,191 2,125 19,402
OTHER RECEIVABLES 17,979
UNBILLED WORK ON UNCOMPLETE CONTRACTS 28,539,034 428,083 4,527,824 (2,400)
RECEIVABLES FROM UNCONSOLIDATED 20% TO 50%
OWNED COMPANIES AND JOINT VENTURES 19,759 (130,860)
RECEIVABLES FROM UNIDENTIFIED RELATED CO -
INVENTORY OF OPERATING SUPPLIES 1,198,456 361,510 525,784
OTHER CURRENT ASSETS 293,789 2,900 43,175
---------- --------- ---------- ---------- --------- ---------- ----------
TOTAL CURRENT ASSETS 74,474,301 1,173,520 12,324,735 - 665,497 - -
---------- --------- ---------- ---------- --------- ---------- ----------
INVESTMENTS IN UNCONSOLIDATED SUBS 3,464,252 3,464,252
---------- --------- ---------- ---------- --------- ---------- ----------
PROPERTY, PLANT AND EQUIPMENT, AT COST 23,069,390 5,970,255 2,792,823 4,212,387
LESS ACCUMULATED DEPRECIATION 12,743,747 3,151,653 2,046,596 1,445,311
---------- --------- ---------- ---------- --------- ---------- ----------
TOTAL PROPERTY, PLANT AND EQUIPMENT 10,325,643 2,818,602 746,227 - 2,767,076 - -
---------- --------- ---------- ---------- --------- ---------- ----------
PREPAID INCENTIVE COMPENSATION 331,539
---------- --------- ---------- ---------- --------- ---------- ----------
RETAINAGE-NON CURRENT 13,987 13,987
---------- --------- ---------- ---------- --------- ---------- ----------
OTHER ASSETS
---------- --------- ---------- ---------- --------- ---------- ----------
TOTAL ASSETS 88,609,722 3,992,122 16,549,201 - 3,432,573 - -
---------- --------- ---------- ---------- --------- ---------- ----------
---------- --------- ---------- ---------- --------- ---------- ----------
LIABILITIES AND SHAREHOLDER'S EQUITY
------------------------------------
ACCOUNTS PAYABLE AND ACCRUALS 4,437,164 47,542 133,230 400 88
ADVANCE ▇▇▇▇▇▇▇▇ ON UNCOMPLETED CONTRACTS 11,001,527 4,383,905
PAYABLES TO UNCONSOLIDATED 20% TO 50%
OWNED COMPANIES AND JOINT VENTURES 2,632 -
CURRENT MATURITIES OF LONG-TERM DEBT 3,451 -
---------- --------- ---------- ---------- --------- ---------- ----------
TOTAL CURRENT LIABILITIES 15,444,774 47,542 4,517,135 - 400 - 88
---------- --------- ---------- ---------- --------- ---------- ----------
ESTIMATED LOSS ON INVESTMENT (1) (1)
RESERVE FOR RESTRUCTURING 211,846 13,048 35,035
ESTIMATED VACATION EXPENSE 2,973,901 137,350 1,285,794
ESTIMATED LOSSES ON UNCOMPLETED CONTRACTS 12,152,823 5,933 3,381,080 666,450
SUPPLEMENTAL RETIREMENT 1,287,205 1,287,205
OTHER DEFERRED CREDIT AND RESERVES 7,835 (30,925)
---------- --------- ---------- ---------- --------- ---------- ----------
TOTAL DEFERRED CREDITS AND RESERVES 16,633,609 156,331 4,670,983 1,287,205 666,450 - -
---------- --------- ---------- ---------- --------- ---------- ----------
CORP INVESTMENTS AND ADVANCES
EQUITY 25,594,196 360,481 (1,499,832) (1,287,205) 2,766,274 399,802
ADVANCES 30,937,143 3,427,767 8,860,914 (550) (399,891)
---------- --------- ---------- ---------- --------- ---------- ----------
TOTAL CORP INVESTMENT AND ADVANCES 56,531,339 3,788,248 7,361,082 (1,287,205) 2,765,724 - (89)
---------- --------- ---------- ---------- --------- ---------- ----------
TOTAL LIABILITY AND SHAREHOLDER'S EQUITY 88,609,722 3,992,122 16,549,201 - 3,432,573 - -
---------- --------- ---------- ---------- --------- ---------- ----------
---------- --------- ---------- ---------- --------- ---------- ----------
ADDITIONS
---------
UST AR OTHER ADJUSTED
GOVT RATE EX. UB ADJ ADJUSTMENTS REMEDIATION BAL SHEET
---------- --------- ---------- ---------- --------- ----------
ASSETS
-----------------------------------
CASH ON HAND AND IN BANKS 3,904,724 -
TRADE ACCOUNTS RECEIVABLE, LESS
ALLOWANCE FOR DOUBTFUL ACCOUNTS 11,848,383 18,839,390
RETAINAGE 809,351
NOTES RECEIVABLES 60,036
EMPLOYEE RECEIVABLES 535,664
OTHER RECEIVABLES 17,979
UNBILLED WORK ON UNCOMPLETE CONTRACTS 2,338,500 21,247,027
RECEIVABLES FROM UNCONSOLIDATED 20% TO 50%
OWNED COMPANIES AND JOINT VENTURES 150,619 -
RECEIVABLES FROM UNIDENTIFIED RELATED CO -
INVENTORY OF OPERATING SUPPLIES 311,162
OTHER CURRENT ASSETS 247,714
---------- ---------- ---------- ---------- --------- ----------
TOTAL CURRENT ASSETS 2,338,500 11,848,383 - 4,055,343 - 42,068,323
---------- ---------- ---------- ---------- --------- ----------
INVESTMENTS IN UNCONSOLIDATED SUBS -
---------- ---------- ---------- ---------- --------- ----------
PROPERTY, PLANT AND EQUIPMENT, AT COST 1,940,344 8,153,581
LESS ACCUMULATED DEPRECIATION 1,289,026 4,811,161
---------- ---------- ---------- ---------- --------- ----------
TOTAL PROPERTY, PLANT AND EQUIPMENT 651,318 - 3,342,420
PREPAID INCENTIVE COMPENSATION 331,539 -
---------- ---------- ---------- ---------- --------- ----------
RETAINAGE-NON CURRENT -
---------- ---------- ---------- ---------- --------- ----------
OTHER ASSETS -
---------- ---------- ---------- ---------- --------- ----------
TOTAL ASSETS 2,338,500 11,848,383 - 5,038,200 - 45,410,743
---------- ---------- ---------- ---------- --------- ----------
---------- ---------- ---------- ---------- --------- ----------
LIABILITIES AND SHAREHOLDER'S EQUITY
------------------------------------
ACCOUNTS PAYABLE AND ACCRUALS 4,327,909 (72,005) -
ADVANCE ▇▇▇▇▇▇▇▇ ON UNCOMPLETED CONTRACTS 3,109,610 3,508,012
PAYABLES TO UNCONSOLIDATED 20% TO 50%
OWNED COMPANIES AND JOINT VENTURES 2,632 -
CURRENT MATURITIES OF LONG-TERM DEBT 3,451 -
---------- ---------- ---------- ---------- --------- ----------
TOTAL CURRENT LIABILITIES - 3,109,610 4,331,360 (69,373) 3,508,012
---------- ---------- ---------- ---------- --------- ----------
ESTIMATED LOSS ON INVESTMENT -
RESERVE FOR RESTRUCTURING 163,763 -
ESTIMATED VACATION EXPENSE 1,550,757 -
ESTIMATED LOSSES ON UNCOMPLETED CONTRACTS 4,822,071 1,652,924 1,624,365
SUPPLEMENTAL RETIREMENT -
OTHER DEFERRED CREDIT AND RESERVES 38,760
---------- ---------- ---------- ---------- --------- ----------
TOTAL DEFERRED CREDITS AND RESERVES 4,822,071 - 3,203,681 163,763 1,663,125
---------- ---------- ---------- ---------- --------- ----------
CORP INVESTMENTS AND ADVANCES
EQUITY (2,483,571) 4,943,810 22,394,437
ADVANCES 8,738,773 (7,535,041) 17,845,171
---------- ---------- ---------- ---------- --------- ----------
TOTAL CORP INVESTMENT AND ADVANCES (2,483,571) 8,738,773 (7,535,041) 4,943,810 40,239,608
---------- ---------- ---------- ---------- --------- ----------
TOTAL LIABILITY AND SHAREHOLDER'S EQUITY 2,338,500 11,848,383 - 5,038,200 - 45,410,743
---------- ---------- ---------- ---------- --------- ----------
---------- ---------- ---------- ---------- --------- ----------
HALLIBURTON NUS CORPORATION
BALANCE SHEET
PERIOD ENDING DECEMBER 28, 1996
REDUCTIONS
PGH RESIDUAL PEN/PS CORPORATE
CO 080 LAB NUS RESERVES CRLAKE LAB RESERVE RCC
---------- --------- ---------- ---------- --------- ---------- ----------
ASSETS
------------------------------------
CASH ON HAND AND IN BANKS 1,075,831 140,978
TRADE ACCOUNTS RECEIVABLE, LESS
ALLOWANCE FOR DOUBTFUL ACCOUNTS 32,573,915 5,529 497,601 1,447
RETAINAGE 1,640,575 347,387
NOTES RECEIVABLES 1,429,766 300,000 440,803 666,450
EMPLOYEE RECEIVABLES 512,982 8,328
OTHER RECEIVABLES 20,880
UNBILLED WORK ON UNCOMPLETE CONTRACTS 17,704,149 4,939 401,957 (2,400)
RECEIVABLES FROM UNCONSOLIDATED 20% TO 50%
OWNED COMPANIES AND JOINT VENTURES 68,996 (130,860)
RECEIVABLES FROM UNIDENTIFIED RELATED CO -
INVENTORY OF OPERATING SUPPLIES 311,162
OTHER CURRENT ASSETS 106,278 2,900 3,771
---------- --------- ---------- ---------- --------- ---------- ----------
TOTAL CURRENT ASSETS 55,444,534 313,368 1,709,965 - 665,497 - -
---------- --------- ---------- ---------- --------- ---------- ----------
INVESTMENTS IN UNCONSOLIDATED SUBS 4,434,365 4,434,365
---------- --------- ---------- ---------- --------- ---------- ----------
PROPERTY, PLANT AND EQUIPMENT, AT COST 17,974,291 3,930,693 2,198,997 4,212,367
LESS ACCUMULATED DEPRECIATION 10,693,953 1,724,877 1,827,623 1,309,910
---------- --------- ---------- ---------- --------- ---------- ----------
TOTAL PROPERTY, PLANT AND EQUIPMENT 7,280,338 2,205,816 371,374 - 2,902,457 - -
PREPAID INCENTIVE COMPENSATION 215,542
---------- --------- ---------- ---------- --------- ---------- ----------
RETAINAGE-NONCURRENT 1,559,134 485,005
---------- --------- ---------- ---------- --------- ---------- ----------
OTHER ASSETS
---------- --------- ---------- ---------- --------- ---------- ----------
TOTAL ASSETS 68,933,920 2,519,190 7,000,709 - 3,567,954 - -
---------- --------- ---------- ---------- --------- ---------- ----------
---------- --------- ---------- ---------- --------- ---------- ----------
LIABILITIES AND SHAREHOLDER'S EQUITY
------------------------------------
ACCOUNTS PAYABLE AND ACCRUALS 3,030,987 150,047 66,827 400 45,970
ADVANCE ▇▇▇▇▇▇▇▇ ON UNCOMPLETED CONTRACTS 7,684,958 292,985
PAYABLES TO UNCONSOLIDATED 20% TO 50%
OWNED COMPANIES AND JOINT VENTURES 7,053 -
CURRENT MATURITIES OF LONG-TERM DEBT - -
---------- --------- ---------- ---------- --------- ---------- ----------
TOTAL CURRENT LIABILITIES 10,722,998 150,047 359,812 - 400 - 45,970
---------- --------- ---------- ---------- --------- ---------- ----------
ESTIMATED LOSS ON INVESTMENT 100,563 (1)
RESERVE FOR RESTRUCTURING 143,689 1,532
ESTIMATED VACATION EXPENSE 2,623,149 19,786 43,017
ESTIMATED LOSSES ON UNCOMPLETED CONTRACTS 16,482,596 1,086,554 5,395,486 666,450 2,000,000 (45,970)
SUPPLEMENTAL RETIREMENT 1,325,667 1,325,667
OTHER DEFERRED CREDIT AND RESERVES 7,835 (19,086)
---------- --------- ---------- ---------- --------- ---------- ----------
TOTAL DEFERRED CREDITS AND RESERVES 20,683,499 1,106,340 5,420,948 1,325,667 666,450 2,000,000 (45,970)
---------- --------- ---------- ---------- --------- ---------- ----------
CORP INVESTMENTS AND ADVANCES
EQUITY 25,127,698 (2,753,438) 466,922 (1,325,667) 2,901,104 (2,000,000)
ADVANCES 12,399,719 4,016,239 753,027
---------- --------- ---------- ---------- --------- ---------- ----------
TOTAL CORP INVESTMENT AND ADVANCES 37,527,417 1,262,801 1,219,949 (1,325,667) 2,901,104 (2,000,000) -
---------- --------- ---------- ---------- --------- ---------- ----------
TOTAL LIABILITY AND SHAREHOLDER'S EQUITY 68,933,920 2,519,190 7,000,709 - 3,567,954 - -
---------- --------- ---------- ---------- --------- ---------- ----------
---------- --------- ---------- ---------- --------- ---------- ----------
ADDITIONS
---------
UST AR OTHER ADJUSTED
GOVT RATE EX UB ADJ ADJUSTMENTS REMEDIATION BAL SHEET
---------- --------- ---------- ---------- --------- ----------
ASSETS
-----------------------------------
CASH ON HAND AND IN BANKS 745,022 189,831 -
TRADE ACCOUNTS RECEIVABLE, LESS
ALLOWANCE FOR DOUBTFUL ACCOUNTS 15,722,185 759,506 17,106,659
RETAINAGE 1,293,188
NOTES RECEIVABLES 22,513
EMPLOYEE RECEIVABLES 504,654
OTHER RECEIVABLES 20,880
UNBILLED WORK ON UNCOMPLETE CONTRACTS 1,495,417 482,732 16,286,968
RECEIVABLES FROM UNCONSOLIDATED 20% TO 50% -
OWNED COMPANIES AND JOINT VENTURES 199,856 -
RECEIVABLES FROM UNIDENTIFIED RELATED CO -
INVENTORY OF OPERATING SUPPLIES 311,162
OTHER CURRENT 99,607
---------- ---------- ---------- ---------- --------- ----------
TOTAL CURRENT ASSETS 1,495,417 15,722,185 745,022 389,687 1,242,238 35,645,631
---------- ---------- ---------- ---------- --------- ----------
INVESTMENTS IN UNCONSOLIDATED SUBS -
---------- ---------- ---------- ---------- --------- ----------
PROPERTY, PLANT AND EQUIPMENT, AT COST 563,460 7,068,774
LESS ACCUMULATED DEPRECIATION 685,436 5,146,107
---------- ---------- ---------- ---------- --------- ----------
TOTAL PREOPERTY, PLANT AND EQUIPMENT - - - (121,976) - 1,922,667
PREPAID INCENTIVE COMPENSATION 215,542 -
---------- ---------- ---------- ---------- --------- ----------
RETAINAGE-NONCURRENT 1,046,754 27,375
---------- ---------- ---------- ---------- --------- ----------
OTHER ASSETS -
---------- ---------- ---------- ---------- --------- ----------
TOTAL ASSETS 2,542,171 15,722,185 745,022 483,253 1,242,238 37,595,673
---------- ---------- ---------- ---------- --------- ----------
---------- ---------- ---------- ---------- --------- ----------
LIABILITIES AND SHAREHOLDER'S EQUITY
------------------------------------
ACCOUNTS PAYABLE AND ACCRUALS 2,820,571 (52,828) -
ADVANCE ▇▇▇▇▇▇▇▇ ON UNCOMPLETED CONTRACTS 3,646,689 958,382 4,703,666
PAYABLES TO UNCONSOLIDATED 20% TO 50% -
OWNED COMPANIES AND JOINT VENTURES 7,053 -
CURRENT MATURITIES OF LONG-TERM DEBT -
---------- ---------- ---------- ---------- --------- ----------
TOTAL CURRENT LIABILITIES - 3,646,689 2,827,624 (52,828) 958,382 4,703,666
---------- ---------- ---------- ---------- --------- ----------
ESTIMATED LOSS ON INVESTMENT 100,564
RESERVE FOR RESTRUCTURING 142,157 -
ESTIMATED VACATION EXPENSE 2,560,346 -
ESTIMATED LOSSES ON UNCOMMPLETED CONTRACTS 5,049,258 1,310,878 1,019,940
SUPPLEMENTAL RETIREMENT -
OTHER DEFERRED CREDIT AND RESERVES 26,921
---------- ---------- ---------- ---------- --------- ----------
TOTAL DEFERRED CREDITS AND RESERVES 5,049,258 - 3,871,224 142,157 - 1,147,425
---------- ---------- ---------- ---------- --------- ----------
CORP INVESTMENTS AND ADVANCES
EQUITY (2,507,087) 393,924 122,523 30,074,463
ADVANCES 12,075,496 (5,953,826) 161,333 1,670,116
---------- ---------- ---------- ---------- --------- ----------
TOTAL CORP INVESTMENT AND ADVANCES (2,507,087) 12,075,496 (5,953,826) 393,924 283,856 31,744,579
---------- ---------- ---------- ---------- --------- ----------
TOTAL LIABILITY AND SHAREHOLDER'S EQUITY 2,542,171 15,722,185 745,022 483,253 1,242,238 37,595,673
---------- ---------- ---------- ---------- --------- ----------
---------- ---------- ---------- ---------- --------- ----------
HALLIBURTON NUS CORPORATION EXHIBIT F-6
BALANCE SHEET
PERIOD ENDING JUNE 28, 1997
UST AR
3802 2420 2408 SUBTOTAL EX. UB PGH LAB
---------- --------- ---------- ---------- ---------- ----------
ASSETS
------------------------------------
CURRENT ASSETS
CASH ON HAND AND IN BANKS 1,950 1,030 2,980
TRADE ACCOUNTS RECEIVABLE, LESS -
ALLOWANCE FOR DOUBTFUL ACCOUNTS 30,040,996 1,572,977 31,613,973 14,139,000 (38,400)
RETAINAGE 1,385,319 19,832 1,405,151
NOTES RECEIVABLES 300,000 300,000 300,000
EMPLOYEE RECEIVABLES 11,071 1,730 12,801
OTHER RECEIVABLES 7,607 7,607
UNBILLED WORK ON UNCOMPLETE CONTRACTS 12,453,767 1,323,512 13,777,279 4,796
RECEIVABLES FROM UNCONSOLIDATED 20% TO 50% -
OWNED COMPANIES AND JOINT VENTURES 12,581 (1,470) 11,111
RECEIVABLES FROM UNIDENTIFIED RELATED CO -
INVENTORY OF OPERATING SUPPLIES (890) 311,341 (265) 310,186
OTHER CURRENT ASSETS 123,041 337,164 1,500 461,705 2,900
---------- --------- ---------- ---------- ---------- ----------
TOTAL CURRENT ASSETS 44,335,442 648,765 2,918,586 47,902,793 14,139,000 269,296
---------- --------- ---------- ---------- ---------- ----------
EQUITY IN NET ASSETS OF AND PAYABLES TO
INVESTMENTS IN UNCONSOLIDATED SUBS - -
---------- --------- ---------- ---------- ---------- ----------
PROPERTY, PLANT AND EQUIPMENT, AT COST 11,628,735 217,469 590,671 12,436,875 3,951,427
LESS ACCUMULATED DEPRECIATION 7,633,588 124,120 483,799 8,241,507 1,802,934
---------- --------- ---------- ---------- ---------- ----------
TOTAL PROPERTY, PLANT AND EQUIPMENT 3,995,147 93,349 106,872 4,195,368 2,148,493
PREPAID INCENTIVE COMPENSATION - - -
---------- --------- ---------- ---------- ---------- ----------
RETAINAGE - NON CURRENT 1,282,699 1,282,699
---------- --------- ---------- ---------- ---------- ----------
OTHER ASSETS - - -
---------- --------- ---------- ---------- ---------- ----------
TOTAL ASSETS 49,613,288 742,114 3,025,458 53,380,860 14,139,000 2,417,789
---------- --------- ---------- ---------- ---------- ----------
---------- --------- ---------- ---------- ---------- ----------
LIABILITIES AND SHAREHOLDER'S EQUITY
------------------------------------
CURRENT LIABILTIES
ACCOUNTS PAYABLE AND ACCURALS 652,011 47,876 406,882 1,106,769 191,000 (100)
ADVANCE ▇▇▇▇▇▇▇▇ ON UNCOMPLETED CONTRACTS 6,582,174 124,538 6,706,712 2,945,014
PAYABLES TO UNCONSOLIDATED 20% TO 50%
OWNED COMPANIES AND JOINT VENTURES - - -
CURRENT MATURITIES OF LONG-TERM DEBT - - -
---------- --------- ---------- ---------- ---------- ----------
TOTAL CURRENT LIABILITIES 7,234,185 47,876 531,420 7,813,481 3,136,014 (100)
---------- --------- ---------- ---------- ---------- ----------
DEFERRED CREDITS AND RESERVES
ESTIMATED LOSS ON INVESTMENT (291) (291)
RESERVE FOR RESTRUCTURING -
ESTIMATED VACATION EXPENSE 2,662,732 19,873 82,085 2,764,690 3,880
ESTIMATED LOSSES ON UNCOMPLETED CONTRACTS 7,427,001 284,882 596,088 8,307,971 901,808
SUPPLEMENTAL RETIREMENT -
OTHER DEFERRED CREDIT AND RESERVES 11,556 (186,673) 7,835 (167,282)
---------- --------- ---------- ---------- ---------- ----------
TOTAL DEFERRED CREDITS AND RESERVES 10,101,289 117,791 686,008 10,905,088 - 905,688
---------- --------- ---------- ---------- ---------- ----------
CORP INVESTMENTS AND ADVANCES
EQUITY 3,557,454 (1,217,946) (80,294) 2,259,214
ADVANCES 28,720,361 1,794,394 1,888,322 32,403,077 11,002,986 1,512,199
---------- --------- ---------- ---------- ---------- ----------
TOTAL CORP INVESTMENT AND ADVANCES 32,277,815 576,448 1,808,028 34,662,291 11,002,986 1,512,199
---------- --------- ---------- ---------- ---------- ----------
TOTAL LIABILITY AND SHAREHOLDER'S EQUITY 49,613,288 742,114 3,025,458 53,380,860 14,139,000 2,417,789
---------- --------- ---------- ---------- ---------- ----------
---------- --------- ---------- ---------- ---------- ----------
ALLOC CORP ADJUSTED
GOVT RATE PPE ADJ OTHER EXCLUDED BAL SHEET
---------- --------- --------- ----------- --------- ----------
ASSETS
------------------------------------
CURRENT ASSETS
CASH ON HAND AND IN BANKS (742,042) 745,022 -
TRADE ACCOUNTS RECEIVABLE, LESS
ALLOWANCE FOR DOUBTFUL ACCOUNTS 646,223 16,867,150
RETAINAGE 1,405,151
NOTES RECEIVABLES -
EMPLOYEE RECEIVABLES (400,146) 412,947
OTHER RECEIVABLES 7,607
UNBILLED WORK ON UNCOMPLETE CONTRACTS 1,974,163 11,798,320
RECEIVABLES FROM UNCONSOLIDATED 20% TO 50% -
OWNED COMPANIES AND JOINT VENTURES 11,111 -
RECEIVABLES FROM UNIDENTIFIED RELATED CO -
INVENTORY OF OPERATING SUPPLIES 310,186
OTHER CURRENT ASSETS 458,805
--------- --------- ------- ----------- --------- ----------
TOTAL CURRENT ASSETS 1,974,163 - 657,334 (1,142,188) 745,022 31,260,166
--------- --------- ------- ----------- --------- ----------
EQUITY IN NET ASSETS OF AND PAYABLES TO
INVESTMENTS IN UNCONSOLIDATED SUBS -
--------- --------- ------- ----------- --------- ---------
PROPERTY, PLANT AND EQUIPMENT, AT COST 1,977,374 6,508,074
LESS ACCUMULATED DEPRECIATION 959,188 5,479,385
--------- --------- ------- ----------- --------- ----------
TOTAL PROPERTY, PLANT AND EQUIPMENT 1,018,186 - - - 1,028,689
PREPAID INCENTIVE COMPENSATION - - - -
--------- --------- ------- ----------- --------- ----------
RETAINAGE-NON CURRENT 1,254,260 28,439
--------- --------- ------- ----------- --------- ----------
OTHER ASSETS -
--------- ---------- ------- ----------- --------- ----------
TOTAL ASSETS 3,228,423 1,018,186 657,334 (1,142,188) 745,022 32,317,294
--------- --------- ------- ----------- --------- -----------
--------- --------- ------- ----------- --------- ----------
LIABILITIES AND SHAREHOLDER'S EQUITY
------------------------------------
CURRENT LIABILITIES
ACCOUNTS PAYABLE AND ACCURALS 646,223 (3,032,459) 3,302,105 -
ADVANCE ▇▇▇▇▇▇▇▇ ON UNCOMPLETED CONTRACTS 1,091,400 2,670,298
PAYABLES TO UNCONSOLIDATED 20% TO 50% -
OWNED COMPANIES AND JOINT VENTURES - - - -
CURRENT MATURITIES OF LONG-TERM DEBT - - - -
--------- --------- ------- ----------- ---------- -----------
TOTAL CURRENT LIABILITIES 1,091,400 - 646,223 (3,032,459) 3,302,105 2,670,298
--------- --------- ------- ----------- --------- -----------
DEFERRED CREDITS AND RESERVES
ESTIMATED LOSS ON INVESTMENT (291) -
RESERVE FOR RESTRUCTURING -
ESTIMATED VACATION EXPENSE (413,661) 3,174,471 -
ESTIMATED LOSSES ON UNCOMPLETED CONTRACTS 5,359,899 675,400 714,164 656,700
SUPPLEMENTAL RETIREMENT -
OTHER DEFERRED CREDIT AND RESERVES (167,282) -
--------- --------- ------- ----------- ---------- -----------
TOTAL DEFERRED CREDITS AND RESERVES 5,359,899 - 675,109 (580,943) 3,888,635 656,700
--------- --------- ------- ----------- ---------- -----------
CORP INVESTMENTS AND ADVANCES
EQUITY (3,222,876) 1,018,186 4,463,904
ADVANCES (663,998) 2,471,214 (6,445,718) 24,526,394
--------- --------- ------- ----------- ----------- -----------
TOTAL CORP INVESTMENT AND ADVANCES (3,222,876) 1,018,186 (663,998) 2,471,214 (6,445,718) 28,990,298
----------- --------- --------- ----------- ----------- -----------
TOTAL LIABILITY AND SHAREHOLDER'S EQUITY 3,228,423 1,018,186 657,334 (1,142,188) 745,022 32,317,294
----------- --------- --------- ----------- ----------- -----------
TRANSITION SERVICES AGREEMENT
This Transition Services Agreement ("Transition Agreement") is made and
entered into as of the ____ day of _________, 1997 (the "Agreement Date") by
and between NUS Acquisition Corp. ("Purchaser"), a Delaware corporation, Tetra
Tech, Inc. ("Parent"), a Delaware corporation, and ▇▇▇▇▇ & Root, Inc.
("Seller"), a Delaware corporation, and Halliburton NUS Corporation ("Seller's
Affiliate"), a Delaware corporation. Purchaser, Parent, Seller and Seller's
Affiliate are sometimes referred to collectively as the "Parties" and
individually as a "Party".
RECITALS
A. Seller and Seller's Affiliate (sometimes referred to collectively as
the "Selling Entities") were previously engaged in the business of providing
consulting, engineering and design services with respect to contamination of
air, water and soil environmental remediation services (the "Business");
B. Purchaser, Parent and Selling Entities have entered into a Purchase
and Sale Agreement (the "Agreement") dated as of the 18th day of October, 1997,
whereby the Selling Entities sold on the date hereof the Business and
substantially all of the properties, rights and assets of the Selling Entities
in respect of the Business to the Purchaser.
C. The Selling Entities have provided certain services and support to
the Business and Purchaser desires that the Selling Entities continue
temporarily to provide such services and support during the months following
the date hereof to the Purchaser to provide Purchaser with an orderly
transition with respect to the Business;
1
NOW, THEREFORE, in consideration of the premises and the mutual
representations, warranties, covenants and agreements made in this Transition
Agreement, the Parties hereto agree as follows:
SECTION 1
NATURE OF THE TRANSITION AGREEMENT
1.1 TERMS AND CONDITIONS. The following are the general terms and
conditions under which the Selling Entities will provide Purchaser certain
support, services and facilities ("Seller Services"). Seller Services will be
provided in accordance with these general terms and conditions and in
accordance with Exhibit A attached to and made a part of this Transition
Agreement.
SECTION 2
SELLER SERVICES
2.1 SELLER FACILITIES. As requested by Purchaser, the Selling Entities
shall provide Purchaser with substantially the same use of owned real estate,
leasehold interests, and the facilities thereon and the shared office
equipment, furniture and supplies ("Seller Facilities") at the locations
specified in Exhibit A as the Selling Entities made available to the Business
immediately prior to the date hereof. Purchaser may only use the Seller
Facilities to conduct the Business in the manner in which it was being
conducted immediately prior to the date hereof. Subject to Section 2.2 below,
Purchaser, with respect to its use of Seller Facilities, shall pay the
applicable monthly rent for each of the Seller Facilities at the rate set forth
in Exhibit A, which rates include normal utilities and taxes. Selling
Entities' obligation to provide Purchaser the use of Seller Facilities shall
terminate SIX (6) MONTHS after the Agreement Date. Purchaser shall leave the
Seller Facilities in
2
substantially the same condition as existed on the date hereof with fair wear
and tear excepted.
2.2 FREE RENTAL PERIOD. Purchaser shall not owe any rental on a facility
listed in Exhibit A if Purchaser has removed all its property, equipment and
personnel from such facility within thirty (30) days from the Agreement Date.
For purposes of calculating time under this provision, the first day of the
thirty (30) day period shall be deemed to be the day after the Agreement Date.
If Purchaser does not vacate a facility within such thirty (30) day period,
3
Purchaser shall pay the applicable monthly rent for such facility but only for
the period commencing on the thirty first (31st) day through the date the
facility is vacated.
2.3 MISCELLANEOUS SERVICES. Selling Entities will provide such services
as may be reasonably requested by Purchaser to permit Purchaser to continue
operations relating to the Business in the same manner as such services were
being provided by the Selling Entities to the Business immediately prior to the
Agreement Date ("Miscellaneous Services"). The Miscellaneous Services shall
include, but not be limited to:
PAYROLL/PERSONNEL FUNCTIONS
ACCOUNTS RECEIVABLE/BILLING
ACCOUNTS PAYABLE
FIXED ASSETS ACCOUNTING
GENERAL LEDGER/REPORTING
TELEPHONE, TELEX AND MEMO SYSTEM
The Miscellaneous Services would also include reasonable assistance to
Purchaser in making the transition from Selling Entities' systems to the
Purchaser's systems. Selling Entities shall be obligated to furnish the
Miscellaneous Services, if requested by Purchaser, for a maximum of SIX (6)
MONTHS from the Agreement Date. Miscellaneous Services shall not include two-
way radio communications, legal and credit services.
2.4 CHARGES FOR MISCELLANEOUS SERVICES. Purchaser shall pay to the
Selling Entities for the supply of any or all of the Miscellaneous Services a
monthly charge in the amount of Selling Entities' cost consistent with Selling
Entities' current accounting practices. As long as any of the
4
Miscellaneous Services are being supplied to the Purchaser by the Selling
Entities, this monthly charge shall apply. If Purchaser elects to
discontinue the Miscellaneous Services during a month, a full month's charge
will be due for such month.
2.5 ADDITIONAL SUPPORT. The Selling Entities shall not be obligated to
incur any additional costs for interim third party software licenses or
sublicenses needed to continue providing the Miscellaneous Services to the
Business, and all such additional costs shall be for Purchaser's account. If
Purchaser requests in writing the Selling Entities to make any systems software
modifications or special accommodations in connection with the Selling
Entities' Miscellaneous Services and the Selling Entities agree to provide
same, such will be for Purchaser's account and chargeable at a rate equal to
Selling Entities' cost consistent with Selling Entities current accounting
practices.
2.6 ACCOUNTING DATA. Purchaser understands and acknowledges that the
accounting data for the Business has been maintained as an integral part of the
accounting data for the entire Selling Entities and, therefore, the records
produced as a result of the normal services covered by this Section 2 may not
include all records which a stand alone business may require nor be in the form
that would normally be produced for a stand alone business.
SECTION 3
COMPENSATION
3.1 INVOICES. For all Seller Services, Purchaser shall be invoiced on a
monthly basis no later than the tenth (10th) working day of the month
immediately following the provision of such services.
5
3.2 DUE DATE. Invoices issued pursuant to Section 3.1 above shall be due
and payable within forty-five (45) days of the date of the invoice.
3.3 PAYMENT ADDRESS. Payment of invoices issued pursuant to Sections 3.1
and 3.2 above shall be made by wire transfer to Seller's account as follows:
Bank Name:
Address:
ABA Routing No.:
Account Name:
Account No.:
SECTION 4
COMMUNICATION AND ADMINISTRATION
4.1 INQUIRIES, REQUESTS AND INSTRUCTIONS. All inquiries, requests and
instructions pertaining to invoices under this Transition Agreement shall be
directed in writing to the following individuals:
SELLER BILLING INQUIRIES: PURCHASER BILLING INQUIRIES:
▇▇▇▇▇ & Root, Inc.
Attn: Attn:
[Address] [Address]
Telephone: Telephone:
Fax: Fax:
6
SECTION 5
CONFIDENTIAL INFORMATION AND MATERIAL
5.1 CONFIDENTIALITY. With respect to information obtained by any Party
with respect to the Business in the provision of Seller Services, each Party
shall maintain confidential and secret all material which may be disclosed by
the other Party and identified as being confidential or secret.
5.2 ACCESS. Purchaser and Selling Entities shall restrict disclosure of
confidential and secret information and material to employees who have a need
to know and shall employ the same standard of care each uses to protect its own
confidential or secret information and material.
5.3 SURVIVAL. The obligations of this Section 5 shall survive the
expiration and termination of this Transition Agreement for a period of five
(5) years.
SECTION 6
TERM AND TERMINATION
6.1 TERM. This Transition Agreement shall commence as of the Agreement
Date and shall remain in effect for a maximum of SIX (6) MONTHS thereafter,
except as specifically provided otherwise in this Transition Agreement and
subject to Purchaser's rights to discontinue its receipt of Seller Services
hereunder.
6.2 NO WAIVER. Section 6.1 shall not be deemed to waive, prejudice or
diminish any rights of Purchaser or Selling Entities under the Agreement.
SECTION 7
FORCE MAJEURE
7.1 FORCE MAJEURE. No Party shall be liable for any failure or delay on
its part in
7
performing any of its obligations under this Transition Agreement for any
loss, damage, costs, charges and expenses incurred or suffered by any other
Party by reason thereof if failure or delay is the result of or arises out of
Force Majeure, provided that the Party claiming Force Majeure shall use its
best efforts to avoid, remove, or mitigate such cause of non-performance and
shall fulfill and continue performance hereunder whenever and to the extent
such cause ceases to exist. This Section 7 shall not apply to obligations to
pay sums of money due for Seller Services provided under the terms of this
Transition Agreement.
7.2 DEFINITION. For the purposes of this ▇▇▇▇▇▇▇ ▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇ shall
be defined as any extraordinary event which cannot be avoided or controlled,
including but not limited to acts of God, flood, storm, typhoon or other severe
weather condition, earthquake, fire, riot, insurrection, accident, sabotage,
strike, lockout or differences with labor, or embargo, failure in
transportation or accidental damage to equipment, or any inability to obtain
and maintain, notwithstanding commercially reasonable efforts, any required
consent from a third party in order to provide Seller Services.
SECTION 8
RELATIONSHIP OF THE PARTIES
8.1 NO JOINT VENTURE. Nothing contained in this Transition Agreement,
except as specifically provided in Section 12.13, shall be deemed to constitute
any Party as the agent, partner or joint venturer of the other.
SECTION 9
INDEMNITIES
8
9.1 INDEMNITIES.
A. SELLING ENTITIES' INDEMNITY. The Selling Entities shall save,
indemnify, defend, and hold Purchaser and the officers, agents, affiliates,
employees and representatives of Purchaser harmless from and against any
losses, damages, costs, claims and liabilities (including costs of legal
counsel and court costs) of any kind or nature ("Losses") arising out of any
(i) injury to or death of any employee of the Selling Entities and (ii) loss of
or damage to the property of the Selling Entities, including (without
limitation) the property of the Selling Entities' employees, which occurs in
connection with any activities of Purchaser at a Seller Facility during this
Transition Agreement, REGARDLESS OF WHETHER OR NOT THE EVENTS DESCRIBED IN
CLAUSES (i ) OR (ii) HEREIN WERE CAUSED IN WHOLE OR IN PART BY THE SOLE,
CONCURRENT, ACTIVE, OR PASSIVE NEGLIGENCE OR OTHER FAULT OF PURCHASER.
B. PURCHASER'S INDEMNITY. Purchaser shall save, indemnify, defend,
and hold Selling Entities, and the officers, agents, affiliates, employees and
representatives of each, harmless from and against any Losses arising out of
any (i) injury to or death of any employee of Purchaser and (ii) loss of or
damage to the property of Purchaser, including (without limitation) the
property of Purchaser's employees, which occurs in connection with any
activities of the Selling Entities at a Seller Facility during this Transition
Agreement, REGARDLESS OF WHETHER OR NOT THE EVENTS DESCRIBED IN CLAUSES (i) OR
(ii) HEREIN WERE CAUSED IN WHOLE OR IN PART BY THE SOLE, CONCURRENT, ACTIVE OR
PASSIVE NEGLIGENCE OR OTHER FAULT OF SELLING ENTITIES. The Leased Employees
described in Section 10.1 shall be
9
deemed employees of Purchaser for purposes of this Section 9.1.
C. Except as otherwise provided in this Transition Agreement,
Purchaser and the Selling Entities, respectively, each agree to indemnify and
hold each other harmless from and against any Losses arising out of any injury
to or death of a third party or loss of or damage to the property of a third
party which is attributable to the negligence of the Purchaser or the Selling
Entities in connection with their activities at a Seller Facility during this
Transition Agreement; provided, however, that such liability shall be limited
to the percentage degree of negligence of the indemnifying party causing the
injury, death or property loss or damage upon which the loss, damage, cost,
claim or liability is based.
SECTION 10
LEASED EMPLOYEES
10.1 LEASED EMPLOYEES. Selling Entities will continue to employ any of
the employees of the Business after the Closing at the request of Purchaser for
a period ending not later than [______________, 19__] for non-exempt employees
and [_________________, 19__] for exempt employees, and will lease those
employees ("Leased Employees") to Purchaser during such period to enable
Purchaser to operate the Business after the Closing while arrangements are
made by Purchaser to employ the Leased Employees to operate the Business.
Selling Entities will charge Purchaser as a fee for leasing the employees an
amount equal to the total compensation of the Leased Employees during such
period plus all payroll related costs for group insurance, retirement plan
costs, payroll taxes, workers' compensation benefit costs and any other costs
incurred by the Selling Entities as a consequence of having the Leased
Employees on the Selling Entities' payroll
10
during such period. In addition, Purchaser agrees to indemnify the Selling
Entities for any costs incurred by the Selling Entities under their medical
plan, disability income plan and workers' compensation self insurance plan
(whether incurred during or after the period for which the Leased Employees
are provided to Purchaser) as a result of events occurring during the period
for which the Leased Employees are leased in excess of the employee and
employer contributions to such plans for the period during which the Leased
Employees are provided and, if applicable, subsequent periods with respect to
such Leased Employees. The intent of this provision is that neither Selling
Entities nor the Selling Entities' benefit plans shall incur any costs, net
of fees and indemnity amounts paid by Purchaser or the Leased Employees,
related to such employees which would not be incurred if such Leased
Employees had not been employees of the Selling Entities during the period
for which such Leased Employees are provided to Purchaser.
SECTION 11
DISPUTE RESOLUTION
11.1 RESOLUTION OF CERTAIN DISPUTES. In the event of any dispute between
any of the Selling Entities and the Purchaser over the nature, validity or
amount of any claim for compensation made pursuant to Section 3, which dispute
is not resolved by agreement following good faith discussions, each Party shall
have the right to have its accountant review the claim made by the other, which
review shall be completed within a reasonable time, not to exceed thirty (30)
days from the submission of such claim to such Party. In the event that such
dispute is not resolved between the Parties (after such review by their
accountants), such dispute shall be submitted to and finally settled under the
Rules of the American Arbitration Association ("AAA") by an arbitrator
11
appointed in accordance with those Rules. The place of the arbitration shall
be Houston, Texas. The determination by the arbitrator shall be final and
binding upon the Parties and shall be enforceable in any court of competent
jurisdiction. The Selling Entities shall bear all costs and expenses of their
accountant and one-half of the costs and expenses of the arbitration, and the
Purchaser shall bear all costs and expenses of its accountant and one-half of
the costs and expenses of the arbitration.
SECTION 12
MISCELLANEOUS PROVISIONS
12.1 AMENDMENT AND MODIFICATION. This Transition Agreement may be
amended, modified or supplemented only by an instrument in writing executed by
authorized signatories on behalf of each Party to this Transition Agreement.
12.2 ASSIGNMENT. The Selling Entities may not assign their rights and
obligations hereunder without the prior written consent of Purchaser, and
Purchaser may not assign its rights or obligations hereunder to any person
other than a direct or indirect wholly-owned subsidiary without the prior
written consent of the Selling Entities, which consent may be withheld for any
reason whatsoever, and provided further that any such assignment to a direct or
indirect wholly-owned subsidiary of Purchaser shall be conditioned upon
Purchaser executing and delivering to Selling Entities an unconditional
guarantee of the performance by such assignee of the obligations and duties
undertaken by Purchaser herein, all in such form and substance as may be
satisfactory to Selling Entities.
12.3 NOTICES. Any notice or communication must be in writing and given by
depositing
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the same in the United States mail, addressed to the Party to be notified,
postage prepaid and registered or certified with return receipt requested, or
by delivering the same in person or by courier or by sending such notice or
communication by facsimile transmission. Such notice shall be deemed
received on the earlier of the date on which it is hand-delivered or
otherwise actually received or on the third business day following the date
on which it is so mailed. For purposes of notice, the addresses of the
Parties shall be:
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If to Selling Entities: ▇▇▇▇▇ & Root, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: Vice President-Legal
Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to: Halliburton Company
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: Vice President and Secretary
Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇
If to Purchaser: NUS Acquisition Corporation
c/o Tetra Tech, Inc.
▇▇▇ ▇. ▇▇▇▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: President and Chief Executive
Officer
Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇
Any Party may change its address for notice by written notice given to the
other Parties.
12.4 COUNTERPARTS. This Transition Agreement may be executed in
counterparts, each of which shall be deemed an original, and all of which
together shall constitute one and the same instrument.
12.5 CAPTIONS. The captions contained in this Transition Agreement are
for convenience of reference only and shall not limit or otherwise affect any
of the terms or provisions of this Transition Agreement.
12.6 SEVERABILITY. If any provision of this Transition Agreement is held
to be illegal, invalid or unenforceable, such provision shall be fully
severable and this Transition Agreement shall be construed and enforced as if
such illegal, invalid or unenforceable provision never comprised a part hereof,
and the remaining provisions hereof shall remain in full force and effect
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and shall not be affected by the illegal, invalid or unenforceable provision
or by its severance herefrom.
12.7 WAIVER. All of the original rights and powers of either Party
hereunder shall remain in force notwithstanding any neglect, forbearance or
delay in enforcement thereof and neither Party shall be deemed to have waived
any of its rights or any provision of this Transition Agreement or any notice
given hereunder unless such waiver is in a writing signed by an officer of the
waiving Party. No such waiver by either Party of any breach by the other Party
of this Transition Agreement shall be deemed a waiver of any continuing, future
or recurring breach.
12.8 GOVERNING LAW. THIS TRANSITION AGREEMENT AND THE RIGHTS AND
OBLIGATIONS OF THE PARTIES HERETO SHALL BE GOVERNED, CONSTRUED AND ENFORCED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS, WITHOUT
REGARD TO THE CHOICE OF LAW PROVISIONS THEREOF OR SUCH PROVISIONS OF ANY OTHER
JURISDICTION.
12.9 NO THIRD PARTY BENEFICIARIES. Nothing in this Transition Agreement,
whether express or implied, shall confer any rights or remedies under or by
reason of this Transition Agreement on any persons other than the Parties to it
and their respective successors, assigns and permitted designees, nor is
anything in this Transition Agreement intended to relieve or discharge the
obligation or liability of any third persons to any Party to this Transition
Agreement, nor shall any provision of this Transition Agreement give any third
persons any right of subrogation or action against any Party to this Transition
Agreement.
12.10 JOINT AND SEVERAL LIABILITY. The Selling Entities are jointly
and severally liable for
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all obligations of any of them under this Transition Agreement, and Purchaser
shall be entitled to enforce all such obligations against Seller without the
necessity of joining Seller's Affiliate in such enforcement action.
12.11 CONSTRUCTION. This Transition Agreement shall be interpreted
without regard to any presumption or rule requiring construction against the
Party causing such agreement to be drafted.
12.12 ENTIRE AGREEMENT. This Transition Agreement, including the
Exhibits, supersede all prior agreements and understandings relating to the
subject matter hereof, except that the obligations of any Party under the
Agreement or any agreement executed pursuant to the Agreement shall not be
affected by this Section.
12.13 ACTIONS ON BEHALF OF SELLING ENTITIES. Any payment by Purchaser
to Seller of any amount due and payable to the Selling Entities under this
Transition Agreement shall be deemed payment to each of the Selling Entities of
its respective share of such amount and each of the Selling Entities hereby
acknowledges that such payment constitutes payment to each of the Selling
Entities.
12.14 PARENT GUARANTY. The Parent is executing this Transition
Services Agreement to evidence its guaranty of the obligations of the Purchaser
hereunder.
IN WITNESS WHEREOF, the Parties have caused this Transition Agreement to
be executed on and as of the Agreement Date.
PARENT: PURCHASER:
TETRA TECH, INC. NUS ACQUISITION CORP.
a Delaware Corporation a Delaware Corporation
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By:________________________________ By:________________________________
Its: ______________________________ Its: ______________________________
SELLER:
▇▇▇▇▇ & ROOT, INC.
a Delaware Corporation
By:_______________________________
Its:______________________________
SELLER'S AFFILIATE:
HALLIBURTON NUS CORPORATION
a Delaware Corporation
By:_______________________________
Its:______________________________
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