EXHIBIT 10.64
EXECUTION COPY
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ASSET PURCHASE AGREEMENT
Dated as of
August 1, 2002
Between
▇▇▇▇▇▇ CHEMICALS AND PLASTICS OPERATING
LIMITED PARTNERSHIP
And
GEISMAR VINYLS CORPORATION
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ASSET PURCHASE AGREEMENT
ASSET PURCHASE AGREEMENT (this "Agreement") dated as of August 1, 2002, between
▇▇▇▇▇▇ CHEMICALS AND PLASTICS OPERATING LIMITED PARTNERSHIP, a Delaware limited
partnership ("Seller"), and GEISMAR VINYLS CORPORATION, a Delaware corporation
("Purchaser").
RECITALS:
A. Seller was engaged in the manufacturing, marketing, distribution
and sale of polyvinyl chloride ("PVC") resins and feedstocks (such as ethylene
dichloride ("EDC") and vinyl chloride monomer ("VCM") produced at its PVC and
VCM-E plants at Geismar, Louisiana (the "Former Operation").
B. On April 3, 2001, Seller, together with its subsidiary BCP
Finance Corporation, a Delaware corporation ("BCP") (collectively with Seller
and BCP, the "Debtors"), filed voluntary petitions for relief under chapter 11
of the Bankruptcy Code, 11 U.S.C. Section 101-1330 (as now in effect or
hereafter amended, the "Bankruptcy Code") in the United States Bankruptcy Court
for the District of Delaware (the "Bankruptcy Court"), and the Debtors' chapter
11 cases (the "Bankruptcy Cases") have been consolidated for procedural purposes
only and are being administered jointly as Case No. 01-1268 (PJW).
C. The Debtors are continuing in possession of their respective
properties and are operating their businesses as debtors in possession pursuant
to sections 1107 and 1108 of the Bankruptcy Code.
D. Seller desires to sell and Purchaser desires to purchase,
pursuant to Section 363(b) of the Bankruptcy Code, certain of the assets used by
Seller in the conduct of the Former Operation, and Seller desires to assume and
assign and Purchaser desires to accept, pursuant to Section 365 of the
Bankruptcy Code, certain of the executory contracts to which Seller is a party,
all on the terms and subject to the conditions hereinafter set forth.
Notwithstanding the foregoing, Purchaser is not purchasing an on-going business.
E. Seller and Purchaser have determined to enter into this Agreement
which, among other things, provides for Seller to sell, transfer and convey
("Transfer") to Purchaser, and Purchaser to purchase and acquire from Seller,
all of the Assets (as hereinafter defined).
NOW, THEREFORE, in consideration of the representations, warranties,
covenants and agreements set forth in this Agreement, and for other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, Purchaser and Seller hereby agree as follows:
ARTICLE I
DEFINITIONS
1.1 Definitions. The following terms used in this Agreement shall
have the following meanings:
"Accountants" has the meaning set forth in Section 2.4(c).
"Affiliate" means, with respect to any Person, any other Person who is
directly or indirectly controlling, controlled by or under the common control
with such Person. For the purposes of this definition, the term "control," when
used with respect to any Person, means the possession, directly or indirectly,
of the power to direct or cause the direction of the management and policies of
such Person, whether through the ownership of voting securities, by contract or
otherwise.
"Agreement" means this Asset Purchase Agreement, together with the
Schedules and Exhibits hereto.
"Annual EBITDA" shall mean the earnings directly attributable to the
Assets calculated before taxes and interest expense and depreciation and
amortization on assets acquired from Seller, provided, that, purchases of
product and materials from any Affiliate of the Purchaser are at market prices
as published in a recognized industry publication and that general and
administrative expenses used in calculating the earnings directly attributable
to the Assets include a reasonable management fee (which fee shall be calculated
as two percent (2%) of revenues attributable to the Assets, provided, however,
such fee shall not be less than $1.0 million nor greater than $2.0 million in
any twelve month period).
"Annual Statement" shall have the meaning set forth in Section 2.4(c).
"Assets" has the meaning set forth in Section 2.1.
"Assumed Contracts" has the meaning set forth in Section 2.1(c).
"Assumed Liabilities" has the meaning set forth in Section 2.3(a).
"Bankruptcy Cases" has the meaning set forth in Recital B.
"Bankruptcy Code" has the meaning set forth in Recital B.
"Bankruptcy Court" has the meaning set forth in Recital B.
"Bankruptcy Court Order" has the meaning set forth in Section 7.2.
"Bankruptcy Laws" means the United States Bankruptcy Code, as amended,
the Federal Rules of Bankruptcy Procedure, as amended, and the local rules of
the Bankruptcy Court.
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"BCI" means ▇▇▇▇▇▇ Chemical, Inc. a New Jersey corporation.
"BCP" has the meaning set forth in Recital B.
"Bid Procedures Order" has the meaning set forth in Section 7.3.
"Books and Records" has the meaning set forth in Section 2.1(f).
"Breakup Fee" has the meaning set forth in Section 7.4.
"Business Day" means any day that is not a Saturday, a Sunday or a day
on which financial institutions in the City of New York, New York are permitted
or required to close.
"Closing" has the meaning set forth in Section 2.6(a).
"Closing Date" has the meaning set forth in Section 2.6(a).
"Consent" means any consent, waiver, approval, order or authorization
of, or registration, declaration or filing with or notice to, any Governmental
Entity or other Person.
"Contract" means any contract, agreement, lease, license engagement,
rights of way, easements or commitment, whether written or oral, expressed or
implied, entered into by or on behalf of Seller in connection with the Former
Operation.
"Debt" means any obligations for borrowed money.
"Debtors" has the meaning set forth in Recital B.
"▇▇▇▇▇▇▇ Money Deposit" has the meaning set forth in Section 2.4(b).
"Easement Agreement" has the meaning set forth in Section 8.3(h).
"Environmental Condition" shall mean any of the following, to the
extent arising prior to the Closing Date (x) the discharge, release, spilling,
dumping, leaking, burial, migration, receiving, handling, use, storage,
treatment, disposal or transportation by Seller of any Hazardous Material with
respect to the Former Operation or any of the Real Property or leased real
property or any property formerly owned or operated by Seller and (y) any
violation of or noncompliance with any Environmental Law by Seller or any of its
predecessors in interest.
"Environmental Law" or "Environmental Laws" shall mean any and all
statutes, codes, ordinances, Governmental Entity rules, regulations, and
reporting or licensing requirements relating to pollution or protection of human
health or the environment in effect as of the date of this Agreement, including,
without limitation the Comprehensive Environmental Response Compensation and
Liability Act, 42 U.S.C. Sections 9601 et seq. ("CERCLA") and RCRA.
"Environmental Liability" shall mean all payments, obligations, actions
or causes of action, claims, demands, judgments, assessments, losses, damages,
liabilities, penalties, fines, forfeitures, costs and expenses of every kind and
nature (including the defenses thereof and
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reasonable attorneys' and other professional fees) to the extent arising out of
any Environmental Condition.
"Equipment Charges" has the meaning set forth in Section 2.5(b)(ii).
"Escrow Agreement" has the meaning set forth in Section 2.4(b).
"Expense Reimbursement" has the meaning set forth in Section 7.4.
"Former Operation" has the meaning set forth in Recital A.
"General Partner" means BCP Management, Inc., a Delaware corporation,
in its capacity as general partner of Seller.
"Governmental Entity" means any foreign or United States federal,
state, local or municipal government, court, administrative agency or commission
or other governmental or other regulatory authority or agency.
"Hazardous Material" or "Hazardous Materials" shall mean any and all
chemicals, substances and wastes, defined as hazardous or toxic or otherwise
regulated under any Environmental Law, including, without limitation, RCRA
hazardous wastes, CERCLA hazardous substances, pesticides and other agricultural
chemicals, oil and petroleum products or byproducts and any constituents
thereof, and polychlorinated biphenyls (PCBs).
"Intangible Assets" has the meaning set forth in Section 2.1(e).
"Inventory" has the meaning set forth in Section 2.2(a).
"Laws" means all applicable laws, regulations, rules, judgments, orders
and decrees of Governmental Entities.
"Lien" means, with respect to any property or asset, any mortgage,
lien, pledge, security interest or other encumbrance.
"Material Adverse Effect" means such state of facts, event, change or
effect as has had, or would reasonably be expected to have, a material adverse
effect on the Assets taken as a whole, other than events, changes or
developments relating to the economy in general or resulting from industry-wide
developments affecting Persons in businesses similar to the Former Operation,
provided, that, no actions taken by Seller in accordance with Section 6.11 shall
be deemed a Material Adverse Effect.
"Nonassignable Assets" has the meaning set forth in Section 3.1(a).
"Order" means any administrative decision or award, decree, injunction,
judgment, order, quasi-judicial decision or award, ruling, or writ of any
federal, state, local or foreign or other court, arbitrator, mediator, tribunal,
administrative agency, or Governmental Entity.
"Permits" has the meaning set forth in Section 2.1(d).
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"Permitted Liens" means (i) Liens listed or described on Schedule 1.1;
(ii) easements, covenants, rights-of-way and other encumbrances or restrictions
of record which do not have, individually or in the aggregate, a Material
Adverse Effect, Liens related to Taxes not yet due or payable or which are being
contested in good faith and for which appropriate reserves have been taken, and
(iii) Liens or restrictions arising as a matter of Law, and (iv) Liens that are
created, suffered or assumed by Purchaser.
"Person" means an individual, corporation, partnership, limited
liability company, association, trust or other entity or organization, including
without limitation, a Governmental Entity.
"Personal Property" has the meaning set forth in Section 2.1(b).
"Personal Property Taxes" has the meaning set forth in Section
2.5(b)(iv).
"Promissory Note" has the meaning set forth in Section 2.4(a).
"Proration Items" has the meaning set forth in Section 2.5(a).
"Purchase Price" has the meaning set forth in Section 2.4(a).
"Purchaser" has the meaning set forth in the Preamble.
"RCRA" means the Resource Conservation and Recovery Act, 42 U.S.C.
Sections 6901 et. seq., as amended.
"Real Property" has the meaning set forth in Section 2.1(a).
"Real Property Taxes" has the meaning set forth in Section 2.5(b)(iii).
"Remedial Action" shall mean any investigation, monitoring, testing,
sampling, removal, action, clean-up, remediation or corrective action with
respect to any Hazardous Material contamination or pollution, required or
ordered by any Governmental Entity in accordance with applicable Environmental
Laws.
"Remediation Equipment" has the meaning set forth in Section 2.2(i).
"Rental Charges" has the meaning set forth in Section 2.5(b)(v).
"Retained Liabilities" has the meaning set forth in Section 2.3(b).
"Seller" has the meaning set forth in the Preamble.
"Seller Estimated Proration Amount" has the meaning set forth in
Section 2.5(c).
"Startup Date" shall mean the date on which the first pound of saleable
product is produced by Purchaser utilizing the Assets.
"Steam Stripper" has the meaning set forth in Section 2.2(i).
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"Tax" means any federal, state, local, or municipal net income, gross
income, gross receipts, sales, goods and services, use, ad valorem, transfer,
franchise, profits, withholding, payroll, employment, excise, stamp, occupation,
property, severance, customs, duties or other tax, together with any interest,
penalties, or addition to tax imposed or assessed with respect thereto.
"Third-Party Intellectual Property Rights" has the meaning set forth in
Section 4.7.
"Transfer" has the meaning set forth in Recital E.
"Utility Charges" has the meaning set forth in Section 2.5(b)(i).
ARTICLE II
PURCHASE AND SALE OF THE ASSETS AND LIABILITIES
2.1 Sale and Transfer of the Assets. Subject to the conditions to
Closing set forth in Article VIII of this Agreement, at the Closing Seller will
Transfer to Purchaser the following assets (such assets being referred to as the
"Assets"):
(a) Real Property. The real property listed or described on
Schedule 2.1(a) (the "Real Property");
(b) Personal Property. All tangible personal property, plant and
equipment, including without limitation, buildings, structures, fixtures, raw
material and feedstock pipelines (including without limitation oxygen, HCL,
ethylene, chlorine, EDC, nitrogen and natural gas) (including, without
limitation, all associated equipment necessary to operate and meter said
pipelines and for the normal operation of the Assets), maintenance shops and
equipment, laboratories and equipment, co-generation unit #2, machinery, motor
vehicles, supplies, owned rolling stock, furniture, computers, printers, tools,
spare parts, equipment, furnishings owned by Seller and related to the Former
Operation, all to the extent and only as set forth on Schedule 2.1(b)
(collectively, the "Personal Property"); notwithstanding the foregoing,
Purchaser shall acquire all owned computer hardware required to operate the PVC,
VCM-E and bio facilities whether or not scheduled.
(c) Contract Rights. To the extent transferable to Purchaser at
Closing, all right, title and interest of Seller relating to the Former
Operation at the Closing in and to certain Contracts, as set forth on Schedule
2.1(c) (the "Assumed Contracts"). Purchaser will not assume or accept any of
Seller's contract rights or contract obligations other than those listed on
Schedule 2.1(c);
(d) Licenses and Permits. To the extent assignable under
applicable Law or regulation, all licenses, franchises, permits, certificates,
Consents, and other governmental or quasi-governmental authorizations of Seller
and related to and required for the successful operations of the Former
Operation conducted at the Real Property or any leased real property (the
"Permits") and which are set forth on Schedule 2.1(d);
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(e) Intangible Assets. All intangible assets (including all
emissions credits related solely to the Assets) being acquired pursuant to this
Agreement (to the extent transferable), product recipes and know-how and used in
the conduct of and related to the Former Operation, goodwill associated
therewith, licenses and sublicenses granted and obtained with respect thereto,
and rights thereunder, remedies against infringements thereof, and rights to
protection of interests therein under the laws of all jurisdictions ("Intangible
Assets"); and
(f) Books and Records. All customer records, production and
shipping records and all other books and records of the Former Operation except
to the extent set forth in Section 2.2(c) ("Books and Records").
2.2 The Excluded Assets. Purchaser is purchasing only the Assets
described in Section 2.1. Seller shall not sell and Purchaser shall not purchase
or acquire and the Assets shall not include:
(a) All VCM and PVC inventory ("Inventory") owned by Seller as of
the Closing Date;
(b) Any cash or cash equivalents owned or held by Seller's
bankruptcy estate;
(c) Books and records of the General Partner, including but not
limited to, minutes of meetings of directors and stockholders of the General
Partner, tax returns and records, books of account and ledgers, and such other
records having to do with Seller's organization and aging reports and associated
records of the accounts receivable (although access and the ability to copy
these documents shall be made available to Purchaser, provided, that Purchaser
will pay all reasonable costs in connection therewith);
(d) All accounts, notes and other receivables of Seller;
(e) All prepaid expenses, advance payments, deposits and other
similar assets including, without limitation, prepaid deposits with suppliers
and utilities;
(f) All of the (i) issued and outstanding stock of Monochem,
Inc., (ii) equity interests of ▇▇▇ Management, LLC and (iii) equity interests of
VEI, L.P. owned by Seller;
(g) All of Seller's right, title and interest in its State of
Louisiana DEQ Trust;
(h) Deep ▇▇▇▇▇ as described on Schedule 2.2(h);
(i) The equipment used in connection with the ground water
remediation system conducted pursuant to the June 11, 1998 consent decree,
including, but not limited to, the monitoring ▇▇▇▇▇, recovery ▇▇▇▇▇, pipeline
and related equipment (the "Remediation Equipment"); provided, however, that the
Remediation Equipment shall not include the steam stripper which is being used
to treat recovered ground water (the "Steam Stripper");
(j) All claims of Seller against third parties (including,
without limitation, (i) all claims of Seller arising from incidents occurring
prior to the Closing Date; (ii) those claims not yet ascertained and/or
liquidated; and (iii) any avoidance or preference actions available to the
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Seller under the Bankruptcy Laws) relating to operations of the Former Operation
for the period prior to the Closing Date;
(k) All right, title and interest in and use of any "▇▇▇▇▇▇"
name, Seller name and any derivative thereof including, without limitation, all
trademarks, service marks, trade dress, logos, domain names, trade names and
corporate names in the United States and all other nations throughout the world;
provided, however, that notwithstanding anything herein to the contrary, from
the Closing Date until December 31, 2002, Purchaser shall have the right to use
the "BCP" trade name and trademark for business related exclusively to general
purpose resins;
(l) All right, title and interest in the property of Seller,
except to the extent set forth as Assets in this Agreement;
(m) V-Cracker Ethylene Contract, dated February 14, 1996, by and
between Seller and Shell Chemical Company, as agent of Shell Oil Company; and
(n) All right, title and interest in the emission credits of
Seller, except such emission credits which solely relate to the Assets.
2.3 Liabilities.
(a) Subject to the conditions to Closing set forth in Article
VIII, and the provisions of Section 2.3(b) of this Agreement, at the Closing
Purchaser will assume and thereafter in due course pay, perform and discharge
only the following liabilities (collectively, the "Assumed Liabilities"):
(i) all of the executory obligations and liabilities of
Seller pursuant to the Assumed Contracts, but in each case excluding any
obligations or liabilities (other than the cure payments required under Section
365 of the Bankruptcy Code which is addressed in Section 3.1) to the extent that
such obligations or liabilities arise prior to the Closing under such Assumed
Contracts; and
(ii) Purchaser's portion of the Proration Items (as
hereinafter defined).
(b) Notwithstanding Section 2.3(a) above, all liabilities and
obligations other than the Assumed Liabilities shall be excluded from the
transaction contemplated hereunder and shall not be assumed by Purchaser
("Retained Liabilities"). Retained Liabilities shall include, without
limitation:
(i) Any obligation, contingent or otherwise, of Seller
for Debt or guaranteeing any Debt;
(ii) Liabilities and obligations of Seller with respect
to income Taxes;
(iii) All severance benefits and all employee liabilities
for pensions and other qualified plans, payroll, severance, health and welfare
plans, lawsuits, judgments, administrative judgments, post-retirement benefits,
etc.;
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(iv) All accounts payable associated with the Assets;
(v) Seller's portion of the Proration Items; and
(vi) All Environmental Liabilities accrued or existing
prior to the Closing Date.
2.4 Purchase Price.
(a) In consideration of the sale, transfer, conveyance,
assignment and delivery of the Assets, and in reliance upon the representations
and warranties made herein by Seller, on the Closing Date, Purchaser shall (i)
pay to Seller the amount of FIVE MILLION DOLLARS ($5,000,000) in cash at Closing
by wire transfer and (ii) deliver a promissory note for an amount up to FOUR
MILLION DOLLARS ($4,000,000) in substantially the form of Exhibit A (the
"Promissory Note") less (iii) the Seller Estimated Proration Amount,
(collectively, the "Purchase Price"). Prior to the Closing Date, Purchaser and
Seller shall agree on the allocation of the Purchase Price among the Assets.
(b) Within three (3) Business Days from the date hereof,
Purchaser will deposit with Seller ▇▇▇▇▇▇▇ money in the amount of One Hundred
Seventeen Thousand Dollars ($117,000.00) (the "▇▇▇▇▇▇▇ Money Deposit") pursuant
to the requirements of the Bid Procedures Order. Such ▇▇▇▇▇▇▇ Money Deposit
shall not constitute an asset of the Debtors and shall be held in trust and
escrow in a separate interest bearing account containing no other funds of
Debtors pursuant to an Escrow Agreement substantially in the form set forth on
Schedule 2.4(b) pending the Closing (the "Escrow Agreement"). The amount of the
▇▇▇▇▇▇▇ Money Deposit, together with all earnings thereon, shall be credited
against the Purchase Price at Closing. The ▇▇▇▇▇▇▇ Money Deposit, together with
all earnings thereon, will be refundable to Purchaser upon termination of this
Agreement pursuant to Section 9.1 or at Purchaser's election pursuant to Section
9.3(a), but only if Purchaser is not then in material breach of this Agreement;
provided, however, if Purchaser is in material breach of this Agreement the
▇▇▇▇▇▇▇ Money Deposit shall remain the sole property of Seller.
(c) Within ninety (90) days following the first and second
anniversary of the Startup Date, Purchaser shall provide Seller with a written
statement (the "Annual Statement"), certified by Purchaser's chief financial
officer, setting forth, in reasonable detail, the Annual EBITDA for the previous
twelve (12) months in an annual and monthly format. Seller shall have reasonable
access to Purchaser's books and records related to the Assets necessary for
Seller to evaluate the calculation of Annual EBITDA contained on the Annual
Statement. The Annual Statement shall become final and binding on the Purchaser
and the Seller on the 30th Business Day following the date of delivery to the
Seller unless prior to such 30th Business Day, Seller shall deliver to Purchaser
a written notice that challenges the information contained in such Annual
Statement, together with specific information as to what is challenged. In the
event of such a challenge, if agreement between the parties as to the Annual
Statement has not been reached on the 60th Business Day following its receipt by
Seller, then the disputed issue shall be submitted to a mutually agreed upon
public accounting firm (the "Accountants") for resolution. If such Accountants
shall determine that the actual Annual EBITDA exceeded the Annual EBITDA
contained in the Annual Statement submitted by the Purchaser by ten percent
(10%),
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then the Purchaser shall pay the fees of such Accountants. If such Accountants
shall determine that the actual Annual EBITDA did not exceed the Annual EBITDA
contained in the Annual Statement submitted by the Purchaser by ten percent
(10%), then the Seller shall pay the fees of such Accountants. The determination
of the actual Annual EBITDA by such Accountants shall be final and binding upon
the Purchaser and the Seller. Notwithstanding the foregoing, Purchaser shall
have no further obligation to provide Seller with an Annual Statement subsequent
to the time that the Promissory Note is fully discharged and satisfied by
Purchaser. Seller and its employees, officers, directors and representatives
shall keep all information in the Annual Statement and the books and records of
Purchaser reviewed in connection with the Annual Statement confidential and
shall use such information only for the purposes set forth in this Section
2.4(c).
2.5 Prorations.
(a) For purposes of calculating Assumed Liabilities, Utility
Charges (to the extent that meter readings cannot be obtained on the Closing
Date), Rental Charges, Equipment Charges, Real Property Taxes, and Personal
Property Taxes, including, without limitation, accruals or prepayments thereof
(all as individually defined below and collectively called the "Proration
Items"), shall be prorated directly between the Seller and the Purchaser as
provided in this Section 2.5.
(b) For purposes of this Agreement, the capitalized terms set
forth below shall have the following meanings:
(i) "Utility Charges" shall mean water, sewer,
electricity, gas and other utility charges, if any, applicable to the Real
Property;
(ii) "Equipment Charges" shall mean rental charges
payable or receivable and other payments or receipts applicable to the equipment
of the Former Operation;
(iii) "Real Property Taxes" shall mean ad valorem taxes
imposed upon Seller with respect to the Real Property, general assessments
imposed with respect to the Real Property and special assessments upon the Real
Property, whether payable in full or by installments prior to the Closing Date;
(iv) "Personal Property Taxes" shall mean ad valorem
taxes imposed upon the Assets other than the Real Property; and
(v) "Rental Charges" shall mean common area maintenance
charges, merchant association dues, insurance reimbursement and rental charges
payable or receivable and other payments or receipts (other than Real Property
Taxes) applicable to the Real Property.
(c) Five (5) Business Days prior to the Closing Date, Seller
shall provide Purchaser with an estimate of the apportionment of the Proration
Items as of the Closing Date. Purchaser shall have two (2) Business Days from
receipt of such estimate to object in whole or part to such apportionment and
the Parties shall discuss and finally agree on such apportionment prior to the
Closing. If the Parties are unable to agree on such apportionment, all disputes
related thereto shall be submitted to the Bankruptcy Court for resolution. The
"Seller Estimated
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Proration Amount" shall mean the amount of such apportionment of the Proration
Items that is the responsibility of Seller.
(d) As soon as practicable after the Closing Date, all the
Proration Items shall be apportioned through the Closing Date, and
representatives of Seller and Purchaser will examine all relevant Books and
Records as of the Closing Date in order to make the final determination of the
apportionments. To the extent the Seller Estimated Proration Amount did not
reflect the actual final reconciliation of Proration Items and either the Seller
Estimated Proration Amount is overstated or understated, payments in respect of
such overstatement or understatement shall be made by the appropriate party by
check within seven (7) Business Days after such determination. To the extent
certain Proration Items, such as Real Property Taxes and Personal Property
Taxes, are not known as of the Closing Date, apportionment shall be made on the
basis of the best available evidence, such as the prior years' tax bills, and
such estimated apportionment will be deemed final and conclusive. The parties
shall fully cooperate to avoid, to the extent legally possible, the payment of
duplicate Personal Property Taxes, and each party shall furnish, at the request
of the other, proof of payment of any Personal Property Taxes or other
documentation which is a prerequisite to avoiding payment of a duplicate tax.
(e) If there exists as of the Closing Date any pending appeals of
ad valorem tax assessments with regard to any Assets, the continued prosecution
and/or settlement of such appeals shall be subject to the direction and control
of Purchaser with respect to assessments for the year within which the Closing
occurs.
2.6 Closing.
(a) Unless this Agreement has been terminated and the
transactions contemplated under this Agreement have been abandoned pursuant to
Section 9.1 and subject to the fulfillment or, if permitted, waiver of the
conditions set forth in Article VIII, the closing of the Transfer of the Assets
(the "Closing") will take place via telephone conference and exchange of
documentation via facsimile transfer (followed by overnight delivery of original
documents) on the seventh (7th) Business Day following the fulfillment or, if
permissible, waiver of the conditions set forth in Article VIII, unless another
date or time is agreed to in writing by the parties to this Agreement or ordered
by the Bankruptcy Court (the "Closing Date"). The Closing will be effective as
of 11:59 p.m., Eastern time, on the Closing Date.
(b) At the Closing, Seller will deliver to Purchaser the
following documents, duly executed as required: (i) a ▇▇▇▇ of sale conveying to
Purchaser the Personal Property, Intangible Assets and Books and Records,
subject only to the Permitted Liens; (ii) an assignment to Purchaser of the
Assumed Contracts; (iii) a special warranty deed (act of sale) conveying to
Purchaser title to the Real Property, subject only to the Permitted Liens; (iv)
certificate of existence or certificate of good standing of Seller, as of a date
within thirty (30) days prior to the Closing Date, from the Secretary of State
of Delaware; (v) incumbency and "bring down" certificates from the secretary of
the General Partner in a form reasonably satisfactory to Purchaser; and (vi) a
copy of the Bankruptcy Court Order approving the Transfer free and clear of all
Liens other than the Permitted Liens.
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(c) At the Closing, Purchaser will deliver to Seller the
following documents, duly executed as required: (i) the Promissory Note, (ii) an
agreement assuming the Assumed Contracts, (iii) certificate of existence or
certificate of good standing of Purchaser, as of a date within thirty (30) days
prior to the Closing Date, from the secretary of state of the Purchaser's state
of incorporation or organization, and (iv) incumbency and "bring down"
certificates from the secretary of Purchaser in a form reasonably satisfactory
to Seller.
(d) At the Closing, Purchaser will pay the cash amount of the
Purchase Price, after receiving credit in the amount of the ▇▇▇▇▇▇▇ Money
Deposit and all interest earned thereon and Seller's share of the Escrow Agent's
fees, via wire transfer of immediately available funds to an account designated
by Seller
2.7 Limitation of Liability. PURCHASER ACKNOWLEDGES AND AGREES THAT
PURCHASER AND ITS REPRESENTATIVES HAVE THE EXPERIENCE AND KNOWLEDGE TO EVALUATE
THE FORMER OPERATION, FINANCIAL CONDITION AND LIABILITIES OF THE ASSETS; AND
THAT, IN DETERMINING TO ACQUIRE THE ASSETS, PURCHASER HAS MADE ITS OWN
INVESTIGATION INTO, AND BASED THEREON, PURCHASER HAS MADE ITS OWN INDEPENDENT
JUDGMENT CONCERNING THE ASSETS. IT IS THEREFORE EXPRESSLY UNDERSTOOD AND AGREED
THAT PURCHASER ACCEPTS THE CONDITION OF THE ASSETS "AS IS, WHERE IS" WITHOUT ANY
IMPLIED REPRESENTATION, WARRANTY OR GUARANTEE AS TO MERCHANTABILITY, FITNESS FOR
A PARTICULAR PURPOSE OR OTHERWISE AS TO THE CONDITION, SIZE, EXTENT, QUANTITY,
TYPE OR VALUE OF SUCH PROPERTY, EXCEPT ONLY AS MAY BE OTHERWISE EXPRESSLY
PROVIDED IN THIS AGREEMENT AND SELLER AND ITS AFFILIATES, INCLUDING, WITHOUT
LIMITATION, THE GENERAL PARTNER, HEREBY EXPRESSLY DISCLAIM ANY AND ALL SUCH
IMPLIED REPRESENTATIONS, WARRANTIES OR GUARANTEES. WITHOUT LIMITING THE
GENERALITY OF THE FOREGOING, NONE OF SELLER OR ANY OF ITS AFFILIATES, INCLUDING,
WITHOUT LIMITATION, THE GENERAL PARTNER, MAKES ANY REPRESENTATIONS OR WARRANTIES
WITH RESPECT TO (i) ANY INFORMATION OR DOCUMENTS MADE AVAILABLE TO PURCHASER OR
ITS COUNSEL, ACCOUNTANTS OR ADVISORS WITH RESPECT TO THE FORMER OPERATION, THE
ASSETS, THE ASSUMED LIABILITIES OR THE ASSUMED CONTRACTS OR (ii) EXCEPT AS
EXPRESSLY SET FORTH IN THIS AGREEMENT, THE CONDITION OF THE ASSETS, INCLUDING
WITHOUT LIMITATION, THE ENVIRONMENTAL CONDITION AND COMPLIANCE WITH ANY
ENVIRONMENTAL LAWS OR OTHER LAWS. TO THE EXTENT THE LAW OF THE STATE OF
LOUISIANA MAY BE APPLICABLE TO MOVABLE AND IMMOVABLE PROPERTY, PURCHASER SHALL
IN THE APPROPRIATE CLOSING DOCUMENTS, WAIVE ANY RIGHT IT MAY OTHERWISE HAVE IN
REDHIBITION OR FOR REDUCTION IN THE PURCHASE PRICE OF THE ASSETS PURSUANT TO
ARTICLES 2530 THROUGH 2548 OF THE LOUISIANA CIVIL CODE.
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ARTICLE III
NON-ASSIGNABLE INTERESTS AND RIGHTS
3.1 Nonassignable Interest And Rights.
(a) To the extent that any Assumed Contract or Permit included in
the Assets is not susceptible, under the Bankruptcy Code, of being validly
assigned and transferred to Purchaser ("Nonassignable Assets") without Consent
or that any such transfer or attempted transfer without such Consent would
constitute a breach thereof or a violation of any Laws, this Agreement shall not
constitute a transfer thereof. With respect to such Nonassignable Assets, from
and after the date of this Agreement, Seller will reasonably cooperate with
Purchaser, to (i) obtain all Consents that are necessary for the valid transfer
to Purchaser of all such Nonassignable Assets and (ii) establish at Purchaser's
reasonable direction, a reasonable and lawful arrangement to provide to
Purchaser the benefits of any such Nonassignable Assets.
(b) Notwithstanding the foregoing, to the extent any such
Nonassignable Assets, or any Assumed Contracts susceptible of being assigned and
transferred to Purchaser under the Bankruptcy Code, require payments of monies
to cure any default or breach related to such Nonassignable Assets or Assumed
Contracts, Purchaser shall be solely responsible for such payments, and any such
payments in connection with this Article III shall not be deemed to constitute a
portion of the Purchase Price. Notwithstanding anything herein to the contrary,
Purchaser shall have the right to amend Schedule 2.1(d) so as to delete any
contract referenced therein at any time prior to the entry of the Bankruptcy
Court Order and any such deleted contract shall not be considered an Assumed
Contract hereunder.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF SELLER
Seller hereby represents and warrants to Purchaser as follows:
4.1 Organization. Seller is a limited partnership duly formed,
validly existing and in good standing as a limited partnership under the laws of
its jurisdiction of incorporation.
4.2 Authority. Subject to the approval of the Bankruptcy Court and in
compliance with the Bid Procedures Order, (i) the execution and delivery of this
Agreement by Seller has been or will prior to Closing be duly authorized by the
Board of Directors of the General Partner; (ii) Seller has the requisite
corporate power and authority to execute and deliver this Agreement and to
consummate the transactions contemplated hereby; and (iii) this Agreement is a
valid and binding obligation of Seller, enforceable against it in accordance
with its terms.
4.3 Title to Real Property. Subject to the Bankruptcy Court approval,
at the Closing Seller will convey to Purchaser title to the Real Property free
and clear of all Liens except for Permitted Liens.
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4.4 Title to Other Assets. Subject to the Bankruptcy Court approval,
at the Closing Seller will convey to Purchaser title to the Assets other than
the Real Property, free and clear of all Liens except for Permitted Liens.
4.5 Real Property. Schedule 2.1(a) contains a true and correct list
and legal description of each parcel of Real Property. Except as disclosed on
Schedule 4.5, Seller has not received written notice from any Governmental
Entity alleging, nor does Seller have knowledge, that the Real Property or any
improvements thereon are in violation of any applicable state or local use or
occupancy laws, use restrictions, building ordinances, zoning ordinances and
health and safety ordinances. To Seller's knowledge, there are no pending or
threatened condemnations, planned public improvements, annexation, special
assessments, zoning or subdivision changes, or other similar adverse claims that
are affecting or could affect the Real Property. There are no leases under which
Seller is the lessor or landlord relating to any of the Real Property (or any
portion thereof). Except for Permitted Liens, Seller has not entered into any
other agreements, written or oral, granting any other person or entity any
rights with respect to any of the Real Property. Seller is not a party to any
lease for any real property in connection with the Former Operation.
4.6 Contracts. The Assumed Contracts furnished by Seller to Purchaser
are true, correct and complete copies of the Assumed Contracts, as of date
hereof, together with all amendments and modifications thereto existing. Except
as listed on Schedule 4.6, there are no commitments for capital expenditures
related primarily to the operation of the Assets which in the aggregate total
$100,000 or more that have been approved or made prior to the date of this
Agreement by Seller and that remain outstanding as of the date hereof. Each of
the Assumed Contracts is in full force and effect. The consummation of the
transactions provided for herein pursuant to the Bankruptcy Court Order will not
create or constitute a default or event of default under any such Assumed
Contract or require the consent of any other party to any such Assumed Contract
in order to avoid a default or event of default.
4.7 Intangible Assets. Except as set forth in Section 2.2(k), the
Intangible Assets includes all patents, trademarks, tradenames, service marks
and copyrights used primarily in the operation of the Former Operation. To the
knowledge of Seller, all of the Intangible Assets are valid and subsisting.
Except as not, in the aggregate, reasonably likely to have a Material Adverse
Effect: (i) Seller is not and will not be, as a result of the execution and
delivery of this Agreement or the performance of its obligations hereunder, in
violation of any licenses, sublicenses and other contracts to which it is a
party and pursuant to which it is authorized to use any third-party patents,
trademarks, trade names, service marks, and copyrights ("Third-Party
Intellectual Property Rights"); (ii) no claims with respect to (A) Intangible
Assets; (B) any trade secret material to Seller; or (C) Third-Party Intellectual
Property Rights are currently pending or, to the knowledge of Seller, are
threatened by any Person; or (iii) to the knowledge of Seller, there is no
unauthorized use, infringement or misappropriation of any of the Intangible
Assets by any third party, including any employee or former employee of Seller.
Except as otherwise provided in this Agreement, Seller is transferring all the
material intellectual property and other intangible assets necessary to own and
operate the Former Operation.
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4.8 Environmental Matters.
(a) Except as indicated on Schedule 4.8(a), Seller, with respect
to the Former Operation and the Assets has complied in all material respects
with all applicable Environmental Laws.
(b) Except as indicated on Schedule 4.8(b), the Real Property
(including soils, groundwater and surface water) is not contaminated with any
Hazardous Materials as to which Remedial Action is required under applicable
Environmental Laws.
(c) Except as indicated on Schedule 4.8(c), Seller has not
received any written notice, demand, letter, claim or request for information
alleging that it may be in violation of or liable under any Environmental Law.
(d) Except as indicated on Schedule 4.8(d), Seller is neither
subject to any Orders nor has entered into any agreement with any Governmental
Entity or with a third party relating to any Environmental Liability in
connection with the Former Operation or the Real Property. Copies of such Orders
or agreements are attached to Schedule 4.8(d).
(e) To Seller's knowledge, except as set forth on Schedule
4.8(e), there are no circumstances or conditions involving Seller that could
reasonably be expected to result in any Environmental Liability or restrictions
on the ownership, use or transfer of any of the Real Property pursuant to any
Environmental Law, except as are not, individually or in the aggregate,
reasonably likely to have a Material Adverse Effect.
(f) Except as indicated on Schedule 4.8(f), to the knowledge of
Seller, there exists no noncompliance with, or any condition caused by Seller
which could result in Environmental Liability, which would have a Material
Adverse Effect on Purchaser's ability to operate the Assets subsequent to the
Closing Date on substantially the same basis as conducted and operated during
the Former Operation or would require the payment of fines or penalties by
Purchaser, in respect of facts, conditions or matters occurring or existing
prior to the Closing Date which would have a Material Adverse Effect on
Purchaser's ability to operate the Assets subsequent to the Closing Date on
substantially the same basis as conducted and operated during the Former
Operation.
4.9 Claims and Litigation. Except as set forth on Schedule 4.9, there
are no claims or litigation instituted or pending or, to the knowledge of
Seller, threatened against Seller, except for those that are not, in the
aggregate, reasonably likely to have a Material Adverse Effect or prevent or
materially delay or materially impair the ability of Seller to consummate the
transactions contemplated by this Agreement. To Seller's knowledge, Seller does
not have any claims against third parties relating to the operations of the
Assets for the period prior to the Closing Date.
4.10 Compliance With Laws, Orders and Permits. The Former Operation
has been conducted and the Assets are in compliance in all material respects
with all applicable Laws, Orders and Permits. No investigation or review by any
Governmental Entity with respect to Seller is pending or, to the knowledge of
Seller, threatened, except for those the outcome of which are not, individually
or in the aggregate, reasonably likely to have a Material Adverse
15
Effect or prevent or materially burden, delay or impair the ability of Seller to
consummate the transactions contemplated by this Agreement. The Assets include
all Permits, Orders, and Consents necessary to operate the Assets as formerly
operated, except those the absence of which are not, individually or in the
aggregate, reasonably likely to have a Material Adverse Effect or prevent or
materially burden, delay or impair the ability of Seller to consummate the
transactions contemplated by this Agreement. Seller has no knowledge that any of
its pending Permit applications will not be approved. Seller is in compliance in
all material respects with all Laws applicable to the Assets and/or ownership,
operation and use thereof, and Seller has not received written notice of any
noncompliance or alleged noncompliance with any Law relating or applicable to
any of the Assets, the existence or enforcement of which would have a Material
Adverse Effect upon Purchaser's ability to operate the Assets in connection with
its business subsequent to the Closing Date on substantially the same basis as
conducted and operated during the Former Operation or which would require the
payment of fines or penalties in respect of matters occurring prior to the
Closing Date.
4.11 Absence of Certain Changes or Events. Between January 1, 2002 and
the date hereof, and to the knowledge of Seller, there has not been: (a) any
sale or transfer of any of the assets used in the Former Operation, except for
sales or transfers of products and services made in the ordinary course of
business consistent with past practices; (b) any termination or modification of
any Assumed Contract or (c) any material damage or loss to the Assets other than
in connection with the idling of the business in accordance with Section 6.10.
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF PURCHASER
Purchaser hereby represents and warrants to Seller as follows:
5.1 Corporate Organization and Qualification. Purchaser is a
corporation duly organized, validly existing and in good standing under the laws
of the State of Delaware.
5.2 Corporate Authority. Purchaser has the requisite corporate power
and authority to execute and deliver this Agreement and to consummate the
transactions contemplated hereby. The execution and delivery of this Agreement
by Purchaser and the consummation by it of the transactions contemplated to be
performed hereunder have been duly authorized by all necessary corporate
actions. This Agreement is a valid and binding obligation of Purchaser,
enforceable against it in accordance with the terms hereof except as such
enforceability may be limited by bankruptcy, insolvency, reorganization or other
similar laws affecting the enforcement of creditors' rights generally.
5.3 Conflicts and Defaults. Neither the execution and delivery of
this Agreement by Purchaser nor the performance by Purchaser of the transactions
contemplated hereby will, to Purchaser's knowledge, violate or constitute an
occurrence of default under any provision of, or conflict with, or result in
acceleration of any obligation under, or give rise to a right by any party to
terminate its obligations under, any material contract, sales commitment,
purchase order, security agreement, mortgage, conveyance to secure debt, note,
deed, loan, Lien, lease,
16
agreement, instrument, Order, or other arrangement to which Purchaser is a party
or is bound. Purchaser is not in violation of any of its organizational
documents.
5.4 Consents and Approvals. No Consent, approval, Order or
authorization of, or registration, declaration or filing with, any Governmental
Entity or any Person is required with respect to Purchaser in connection with
the execution, delivery or performance by Purchaser of its obligations under
this Agreement except for Consents, approvals, Orders, authorizations,
registrations, declarations or filings the failure of which to obtain or to make
would not have, individually or in the aggregate, a Material Adverse Effect on
Purchaser's ability to consummate the transactions contemplated by this
Agreement.
5.5 Disclosure of Information. Purchaser represents that it has had
an opportunity to access the Geismar, Louisiana facility of Seller that is the
subject of this Agreement, to make such inspections as Purchaser has desired,
and to ask questions of and receive answers from Seller and its Affiliates and
its representatives regarding Seller, the Former Operation and the Assets.
Purchaser acknowledges that, except as expressly set forth in this Agreement,
none of Seller or any of its Affiliates, including without limitation, the
General Partner, has made any representation or warranty as to Seller's
businesses, assets, results of operations or financial condition of the Former
Operation, Assets, Assumed Contracts or Assumed Liabilities. All representations
and warranties, express or implied, of or on behalf of Seller and its Affiliates
that are not expressly set forth in this Agreement are hereby waived and
released.
5.6 Brokers and Finders. None of Purchaser or any of its directors,
officers or employees has employed any broker or finder or incurred any
liability for any brokerage fees, commissions or finders fees in connection with
the transactions contemplated hereby.
5.7 Funds for the Acquisition. Purchaser has sufficient unencumbered
funds and commitment for funds to pay in cash the Purchase Price and all of its
fees and expenses relating to this Agreement and the transactions contemplated
hereby.
ARTICLE VI
CERTAIN ADDITIONAL COVENANTS OF SELLER AND PURCHASER
6.1 Disclosure Supplements. From time to time prior to the Closing
(and subject to the rights of Purchaser to terminate this Agreement under
Section 9.1), Seller, with Purchaser's written approval, may supplement or amend
the Schedules to this Agreement with respect to any matter that may arise
hereafter that (i) if existing or occurring at or prior to the date hereof,
would have been required to be set forth or described in the Schedules to this
Agreement, or (ii) is necessary to correct any information in the Schedules to
this Agreement or in any representation and warranty of Seller which has been
rendered materially inaccurate thereby. Purchaser's written approval pursuant to
this Section 6.1 will be deemed to have amended the appropriate Schedules and to
have qualified the representations and warranties contained in Article IV.
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6.2 Satisfaction of Conditions.
(a) Each party to this Agreement shall use reasonable efforts to
satisfy promptly all conditions precedent to the obligations of the other party
to consummate the transactions contemplated by this Agreement.
(b) Purchaser shall use its reasonable commercial efforts and pay
all expenses necessary (i) to obtain any licenses, permits, Consents, approvals,
authorizations, qualifications and Orders of Governmental Entities (except the
Bankruptcy Court) as are required in connection with the consummation of the
transactions contemplated hereby, (ii) to effect all necessary registrations and
filings, and (iii) to supply Seller with copies of all registrations, filings
and applications that are filed to obtain any such licenses, permits, Consents,
approvals, authorizations, qualifications or Orders of Governmental Entities.
Subject to the terms and conditions hereof, Purchaser agrees to use its
reasonable commercial efforts to take, or cause to be taken, all action and to
do, or cause to be done, all other things necessary, proper or advisable to
consummate and make effective the transactions contemplated by this Agreement as
soon as practicable.
6.3 Further Assurances. From and after the Closing, each of Seller
and Purchaser shall execute and deliver, in the name and on behalf of Seller or
Purchaser, as appropriate, any assignments or assurances and take and do, in the
name and on behalf of Seller or Purchaser, as appropriate, any other actions and
things reasonably necessary to carry out the intention of this Agreement.
6.4 Notice of Breaches. Purchaser will promptly, and in any event
prior to the Closing, notify Seller in writing if Purchaser becomes aware prior
to the Closing that any representation or warranty made by any Seller in this
Agreement is inaccurate or untrue in any material respect.
6.5 Access to Books, Records and Personnel. Following the Closing,
Purchaser shall, and shall cause its Affiliates and the employees of Purchaser
and its Affiliates to, upon reasonable request, cooperate with Seller or its
successors and assigns and afford to Seller, its Affiliates, or its successors
and assigns and their respective counsel, accountants and other authorized
representatives reasonable access during normal business hours to all Books and
Records, facilities, properties and personnel (and permit Seller and its
Affiliates and their counsel, accountants and other authorized representatives
to make copies of such Books and Records), to the extent that such access may be
reasonably requested by Seller and its Affiliates (i) to facilitate the
investigation, litigation or final disposition of any claim which may have been
or may be made against any Seller or its successors and assigns or any of their
Affiliates in connection with this Agreement, the Assets, the Assumed
Liabilities or the Assumed Contracts or (ii) to facilitate the preparation by
Seller of materials necessary for any Tax filing or any audit, examination or
proceeding or (iii) for any other reasonable business purpose.
6.6 Conduct Prior to Closing. Subject to Section 6.10, from the date
hereof to the Closing Date, and except to the extent that Purchaser shall
otherwise consent in writing, Seller shall:
18
(a) maintain the Assets in all material respects in compliance
with the Bankruptcy Code and any Orders entered by the Bankruptcy Court in the
Bankruptcy Cases;
(b) not sell or otherwise dispose of any real or personal
property or asset that would be an Asset hereunder;
(c) maintain the Assets in their present order and condition,
reasonable wear and use excepted, and maintain all material policies of
insurance covering the Assets in amounts and on terms substantially equivalent
to those in effect on the date hereof; and
(d) comply in all material respects with all Laws applicable to
the Assets.
6.7 Access and Information. From the date hereof to the Closing Date
and during normal business hours, Seller will afford to Purchaser, its lenders,
counsel, accountants, and other representatives, reasonable access to (i) all
information concerning the Assets as they reasonably may request and (ii) the
Real Property, vehicles and equipment for purposes of conducting its due
diligence. Purchaser shall have the right, upon prior written consent of Seller
(which consent shall not unreasonably be withheld), to contact companies which
currently or prospectively have or may have business dealings with Seller, for
the purpose of evaluating the prospect of future business dealings with
Purchaser, provided, that, no confidential information of Seller is distributed
or discussed during such contacts. Seller shall cooperate with Purchaser by
making its employees and information available upon reasonable prior notice,
including without limitation, copies of all contracts, and Books and Records, to
Purchaser during normal business hours, including, without limitation, making
such employees available for meetings with third parties as may be deemed
necessary by Purchaser.
6.8 Notification of Changes. Between the date hereof and the Closing
Date, Seller shall promptly notify Purchaser in writing of any material damage
to or loss of any of the Assets. In the event of any such damage or loss, all
claims against insurers and any insurance proceeds paid as a result of such
damage or loss, to the extent not used to repair or replace such damage or loss,
shall be transferred to Purchaser at Closing.
6.9 Easements. Seller shall grant, or cause to be granted, to
Purchaser all easements over Seller's real property and rights to any other
easements that Seller might have, in each case, to fully use and meter all
existing pipelines, utilities and any roads over Seller's real property not
purchased hereunder which is necessary for Purchaser's full use of the Assets or
future business needs.
6.10 Condition at Closing. Seller shall deliver the PVC plant and
VCM-E plant to Purchaser on the Closing Date in an environmentally sound and
safe idled condition. The PVC plant and VCM-E plant process equipment shall be
de-pressured, decommissioned, and ready for vessel entry. All process equipment
in the PVC plant and VCM-E plant and associated tank farms shall be free of
processed hydrocarbons and sludges.
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ARTICLE VII
BANKRUPTCY COURT APPROVAL
7.1 Approval. Seller and Purchaser acknowledge that, under the
Bankruptcy Laws, this Agreement and the sale of the Assets are subject to
Bankruptcy Court approval. Seller and Purchaser acknowledge that to obtain such
approval, Seller must demonstrate that it has taken reasonable steps to obtain
the highest and best price possible for the Assets, including, but not limited
to, giving notice of the transactions contemplated by this Agreement to
creditors and other interested parties as ordered by the Bankruptcy Court,
providing information about the Former Operation to responsible bidders,
entertaining higher and better offers from responsible bidders and, if
necessary, conducting an auction. Seller acknowledges that this Agreement is the
culmination of an extensive process undertaken by Seller to identify and
negotiate a transaction with a bidder who was prepared to pay the highest and
best purchase price for the Assets while assuming or otherwise satisfying
certain liabilities in order to maximize the value of those Assets.
7.2 Sale Motion. Promptly after the execution hereof, but in any
event no later than three (3) Business Days after the date hereof, Seller shall
file with the Bankruptcy Court a motion, in a form reasonably acceptable to
Purchaser, together with appropriate supporting papers and notices, seeking the
entry of an order, pursuant to Chapter 11 of the United States Bankruptcy Code
Sections 105, 363 and 365, (i) authorizing and approving, inter alia, the
conveyance of the Assets, free and clear of all liens, claims, encumbrances,
pledges, security interests, deeds of trust and charges of any kind, whether
known or unknown, and whether contingent, unliquidated or disputed, which
existed before the Closing on the transfer of the Assets, on the terms and
conditions set forth herein, including but not limited to, the assignment and
assumption of the Assumed Contracts, (ii) providing that the stay contained at
Rule 6004(g) of the Federal Rules of Bankruptcy Procedure shall not apply and
that the order shall be effective and enforceable immediately upon entry, and
(iii) containing a finding that Purchaser has acted in "good faith" within the
meaning of Section 363(m) of the Bankruptcy Code, and (iv) authorizing the
payment of the ▇▇▇▇▇▇▇ Money Deposit together with all earnings thereon to be
made by Seller as part of the Purchase Price in accordance with the provisions
of Section 2.4 (the "Bankruptcy Court Order"), in all form and substance
reasonably satisfactory to the Purchaser and Seller. Subject to Section 7.3,
Seller agrees to use best reasonable efforts to obtain the Bankruptcy Court
Order approving this Agreement and the sale of the Assets to Purchaser
hereunder.
7.3 Bid Procedures Order. Purchaser and Seller acknowledge that the
Bankruptcy Court Order dated October 10, 2001 (the "Bid Procedures Order")
approved the procedures and deadlines for the global bid procedures with respect
to the sale by Seller of the Assets. Purchaser and Seller agree that Seller may
inform any and all interested parties that it intends to submit this Agreement
to the Bankruptcy Court and that any and all other bids or offers with respect
to the Assets must be presented to Seller, in accordance with the procedures and
deadlines set forth in the Bid Procedures Order. If Seller receives any other
bids or offers pursuant to the Bid Procedures Order, it will promptly provide
Purchaser with a copy of the same.
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7.4 Breakup Fee; Expense Reimbursement. In the event, pursuant to the
Bid Procedures Order, the Bankruptcy Court Order approving this Agreement and
the sale of the Assets to Purchaser hereunder is not obtained and the Assets are
sold to another entity or Person, then, Seller shall (i) subject to Bankruptcy
Court approval, pay Purchaser the sum of $234,000, representing the "Breakup
Fee" (herein so called) provided for in the Bid Procedures Order, and (ii)
reimburse Purchaser for its actual expenses incurred in conducting due diligence
of the Assets, and negotiating the terms of this Agreement, not to exceed
$150,000, (the "Expense Reimbursement") in accordance with the Bid Procedures
Order.
ARTICLE VIII
CONDITIONS TO THE TRANSFER
8.1 Condition to the Obligations of Each Party. The obligations of
Seller and Purchaser to consummate the transactions contemplated hereunder are
subject to the satisfaction of the following conditions:
(a) no judgment, injunction, order or decree shall prohibit the
consummation of the Transfer of the Assets or the transactions contemplated
under this Agreement; and
(b) the Bankruptcy Court Order shall have been obtained.
8.2 Conditions to the Obligations of Seller. The obligation of Seller
to consummate the transactions contemplated hereunder is subject to the
satisfaction (or written waiver by Seller) of each of the following further
conditions:
(a) Purchaser shall have performed and complied with in all
material respects all obligations and covenants required to be performed or
complied with by it under this Agreement at or prior to the Closing Date and
Seller shall have received a certificate signed by an executive officer of
Purchaser on behalf of Purchaser to the foregoing effect;
(b) the representations and warranties of Purchaser contained in
Article V of this Agreement and in any certificate or other writing delivered by
Purchaser pursuant to this Agreement shall be true in all material respects at
and as of the Closing Date as if made at and as of such time and Seller shall
have received a certificate signed by an executive officer of Purchaser on
behalf of Purchaser to the foregoing effect; and
(c) the Bankruptcy Court Order approving this Agreement shall
have been entered by the Bankruptcy Court and no injunction or stay pending
appeal shall have been entered precluding the consummation of the transactions
contemplated by this Agreement.
8.3 Conditions to the Obligations of Purchaser. The obligation of
Purchaser to consummate the transactions contemplated hereunder and the
assumption of the Assumed Contracts and the Assumed Liabilities is subject to
the satisfaction (or written waiver by Purchaser) of each of the following
further conditions:
(a) Seller shall have performed and complied with in all material
respects all material obligations and covenants required to be performed or
complied with by it under this
21
Agreement at or prior to the Closing Date and Purchaser shall have received a
certificate signed by an executive officer of the General Partner on behalf of
Seller to the foregoing effect;
(b) the representations and warranties of Seller contained in
this Agreement and in any certificate or other writing delivered by Seller
pursuant to this Agreement shall be true in all material respects at and as of
the Closing Date as if made at and as of such time (other than inaccuracies that
in the aggregate would not have a Material Adverse Effect), and Purchaser shall
have received a certificate signed by an executive officer of Seller on behalf
of Seller to the foregoing effect;
(c) no action, proceeding, investigation, regulation, or
legislation shall be pending which seeks to enjoin, restrain, or prohibit
Purchaser, or to obtain substantial damages from Purchaser, in respect of the
consummation of the transactions contemplated hereby, or which seeks to enjoin
the operation of all or a material portion of the Assets which, in the
reasonable judgment of Purchaser, would make it inadvisable to consummate the
transactions contemplated by this Agreement;
(d) since the date hereof, no damage or loss shall have occurred
to the Assets that has resulted or, to Seller's knowledge, will result in a
Material Adverse Effect;
(e) Seller has disclosed to Purchaser any and all agreements
entered into between BCI and BCP prior to the Closing Date that affects the
Assets, including, but not limited to, any environmental agreements;
(f) Purchaser shall have satisfied itself that Seller has not
taken any action resulting in the loss of interim status as defined under RCRA
with respect to the Assets; and
(g) (1) BCP shall have entered into the following agreements
regarding BCP's responsibility for Environmental Liabilities, including, but not
limited to, its responsibility to investigate or remediate any soil or
groundwater contamination existing on the Assets prior to the Closing Date or
contamination existing on the Assets prior to the Closing Date and which
emanates from the Assets on or after the Closing Date through no fault of the
Purchaser:
(A) an Environmental Allocation Agreement with BCI pursuant to
which BCI will assume responsibility for certain of BCP's obligations under the
consent decree executed in ▇▇▇▇▇▇ Chemicals & Plastics Operating Limited
Partnership v ▇▇▇▇▇ ▇▇▇▇▇▇▇ as Administrator of and the United States
Environmental Protection Agency, Civil Action No. 94-440-A02 and consolidated
cases;
(B) a Settlement Agreement with BCI and the United States
Environmental Protection Agency and the Louisiana Department of Environmental
Quality;
(C) an Environmental Servitude Agreement with BCI pursuant to
which BCI is granted access to the Assets to implement its obligations under the
Settlement Agreement; and
(D) an Operating Agreement and Lease with BCI pursuant to which,
among other things, wastewater and stormwater produced on the Assets will be
managed.
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(2) Purchaser shall be reasonably satisfied itself that the
terms and conditions of the agreements set forth in subparagraph (g)(1), if
implemented, will:
(A) insulate Purchaser from any responsibility for Environmental
Liability of BCP or BCI existing prior to the Closing Date, including, but not
limited to, any liability or responsibility to investigate or remediate any soil
or groundwater contamination existing on the Assets prior to the Closing Date or
contamination existing on the Assets prior to the Closing Date and which
emanates from the Assets on or after the Closing Date through no fault of the
Purchaser; and
(B) not materially and adversely impact Purchaser's use of the
Assets; and
(3) Each of the agreements set forth in subparagraph (g)(1)
will have received final approval by the Department of Justice, U.S.
Environmental Protection Agency, Louisiana Department of Environmental Quality,
the Bankruptcy Court, and by the Boards of Directors of BCI and BCP.
(h) Seller and Purchaser shall have entered a mutually agreeable
easement agreement pursuant to the provisions of Section 6.9 hereof (the
"Easement Agreement").
ARTICLE IX
TERMINATION
9.1 Termination. This Agreement may be terminated and the
transactions contemplated hereby may be abandoned at any time prior to the
Closing:
(a) by mutual written Consent of Seller and Purchaser;
(b) by Seller, so long as Seller is not then in material breach
of this Agreement, (i) if the Closing shall not have occurred within one-hundred
twenty (120) days after the Bankruptcy Court Order is entered approving this
Agreement or (ii) at any time in the event Purchaser is in material breach of
any of its obligations under this Agreement;
(c) by Seller for any reason for which termination by Seller is
authorized pursuant to the Bid Procedures Order;
(d) by Purchaser, provided it is not in breach of any of its
obligations under this Agreement, if Seller corrects any representation or
warranty pursuant to Section 6.1 hereof and the corrected warranty or
representation has a Material Adverse Effect on the Assets, or if any of the
conditions set forth in Sections 8.1 and 8.3 hereof have not been fulfilled or
waived within one-hundred twenty (120) days following the entry of the
Bankruptcy Court Order approving this Agreement and the sale of the Assets to
Purchaser, unless such fulfillment has been frustrated or made impossible by any
act or failure to act of Purchaser;
(e) by Purchaser if, prior to Closing, damage or loss occurs to
the Assets that results in a Material Adverse Effect;
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(f) by Purchaser if Seller has not complied with the provisions
of Sections 6.9 and 6.10 to Purchaser's reasonable satisfaction; and
(g) by Purchaser if Sections 8.3(e), (g) or (h) have not been met
at or before the date that is one-hundred twenty (120) days following the entry
of the Bankruptcy Court Order approving this Agreement and the sale of the
Assets to Purchaser.
(h) by Purchaser if the Bankruptcy Court Order has not been
obtained by October 30, 2002.
9.2 Effect of Termination. In the event of the termination of this
Agreement pursuant to Section 9.1 hereof, this Agreement, except for the
provisions of this Section 9.2 and Sections 2.4(b), 12.4, 12.7 and 12.9, shall
forthwith become null and void and have no effect, without any liability on the
part of either party or their respective directors, officers or stockholders;
provided, however, that notwithstanding the foregoing, (x) if termination occurs
pursuant to Section 9.1(c), the Breakup Fee and Expense Reimbursement shall be
paid by Seller or Seller's estate to Purchaser prior to this Agreement becoming
null and void and having no effect within five (5) Business Days following the
Closing of the sale of the Assets to another Person and (y) if termination
occurs pursuant to Section 9.1(d), Seller or Seller's estate shall pay the
Expense Reimbursement to Purchaser within five (5) Business Days of such
termination to the extent permissible under the Bid Procedures Order.
Notwithstanding the foregoing, Purchaser shall not be entitled to the Expense
Reimbursement if termination occurs as a result of (i) the non-fulfillment of
the condition set forth in Section 8.3(g) or (ii) the non-fulfillment of the
condition set forth in Section 8.3(h). The aforesaid provisions shall survive
such termination for the longest period legally permissible. Nothing in this
Article IX shall, however, relieve either party to this Agreement of liability
for breach of this Agreement occurring prior to such termination or for breach
of any provision of this Agreement which specifically survives termination
hereunder.
9.3 Remedies.
(a) In the event all of the conditions set forth in Sections 8.1
and 8.2 have been satisfied, and this Agreement has not been terminated pursuant
to Section 9.1, if Seller refuses or fails for any reason to close the Transfer
of the Assets in accordance with the terms of this Agreement, Purchaser shall
have the right subject to Bankruptcy Law and Bankruptcy Court approval, as its
sole remedy (other than as set forth in Section 9.2), (i) to obtain specific
performance of Seller's obligations hereunder, or (ii) receive a return of the
▇▇▇▇▇▇▇ Money Deposit.
(b) In the event all of the conditions set forth in Sections 8.1
and 8.3 have been satisfied, and this Agreement has not been terminated pursuant
to Section 9.1, if Purchaser refuses or fails for any reason to close the
Transfer of the Assets in accordance with the terms of this Agreement, Seller
shall have the right, subject to Bankruptcy Law and Bankruptcy Court approval,
as its sole remedy, to (i) obtain specific performance of Purchaser's
obligations hereunder or (ii) retain the ▇▇▇▇▇▇▇ Money Deposit, with all
interest earned thereon, as liquidated damages.
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(c) Neither party shall be liable to the other party for any
incidental, consequential, special, exemplary or punitive damages with respect
to any matter related to or arising out of the breach or delay in the
performance of this Agreement.
ARTICLE X
TAX MATTERS
10.1 Transfer Taxes. Purchaser shall be responsible for the payment of
all state, local, provincial and municipal transfer, sales, use or other similar
Taxes (and all recording or filing fees) resulting from the transactions
contemplated by this Agreement.
ARTICLE XI
SURVIVAL
11.1 Survival. All of the representations and warranties will
terminate upon the Closing without any time limitation. The several covenants of
the parties contained in this Agreement (or in any document delivered in
connection herewith) will remain operative and in full force and effect without
any time limitation, except as any such covenant will be limited in duration by
the express terms hereof.
ARTICLE XII
MISCELLANEOUS
12.1 Entire Agreement. This Agreement, including the Schedules to this
Agreement, constitute the entire agreement of the parties to this Agreement with
respect to the subject matter hereof and thereof and supersede all prior
agreements and undertakings, both written and oral, with respect to the subject
matter hereof and thereof.
12.2 Notices. All notices, requests and other communications to any
party hereunder shall be in writing (including facsimile) and shall be given:
if to Seller to:
▇▇▇▇▇▇ Chemicals and Plastics Operating Limited Partnership
▇▇▇. ▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
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with a copy to:
▇▇▇▇▇, Day, ▇▇▇▇▇▇ & ▇▇▇▇▇:
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇, Esq.
if to Purchaser to:
Geismar Vinyls Corporation
▇▇▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: President
with a copy to:
▇▇▇▇▇ ▇▇▇▇▇ L.L.P.
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. Gold, Esq.
or such other address or facsimile number as such party may hereafter specify
for such purpose by notice to the other party to this Agreement. Each such
notice, request or other communication shall be effective (i) if given by
facsimile transmission, when such facsimile is transmitted to the facsimile
number specified in this Section 12.2 and the appropriate confirmation is
received, or (ii) if given by any other means, when delivered at the address
specified in this Section 12.2.
12.3 Amendments; No Waivers.
(a) Any provision of this Agreement may be amended or waived
prior to the Closing Date if, and only if, such amendment or waiver is in
writing and signed, in the case of an amendment, by Seller and Purchaser or in
the case of a waiver, by the party against whom the waiver is to be effective.
(b) No failure or delay by any party in exercising any right,
power or privilege hereunder shall operate as a waiver thereof nor shall any
single or partial exercise thereof preclude any other or further exercise
thereof or the exercise of any other right, power or privilege.
12.4 Expenses. Except as otherwise provided in this Agreement, all
costs and expenses incurred in connection with this Agreement shall be paid by
the party incurring such cost or expense, except for any filing fees, which
filing fees shall be borne solely by Purchaser.
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12.5 Successors and Assigns. The provisions of this Agreement shall be
binding upon and inure to the benefit of the parties to this Agreement and their
respective successors and assigns provided that Seller shall not assign its
rights pursuant to Section 2.4(c) hereof other than by operation of law (which
shall be subject to Purchaser's consent which shall not be unreasonably
withheld); and provided, further that Purchaser may not assign, delegate or
otherwise transfer any of its rights or obligations under this Agreement without
the consent of Seller (which consent shall not be unreasonably withheld),
provided, further, that Purchaser may assign this Agreement to an Affiliate
without the consent of Seller if and only if such Affiliate agrees in writing to
be bound by the terms of this Agreement on a joint and several basis with
Purchaser. Notwithstanding anything contained in this Agreement to the contrary,
nothing in this Agreement, expressed or implied, is intended to confer on any
person other than the parties to this Agreement or their respective successors
and permitted assigns, any rights, remedies, obligations or liabilities under or
by reason of this Agreement.
12.6 Certain Interpretive Matters.
(a) Unless the context otherwise requires, (i) all references in
this Agreement to Sections, Articles or Schedules are to Sections, Articles or
Schedules of or to this Agreement, (ii) each term defined in this Agreement has
the meaning ascribed to it and (iii) words in the singular include the plural
and vice versa. All references to "$" or dollar amounts will be to lawful
currency of the United States of America.
(b) Titles and headings to Sections in this Agreement are
inserted for convenience of reference only, and are not intended to be a part of
or to affect the meaning or interpretation of this Agreement. No provision of
this Agreement will be interpreted in favor of, or against, any of the parties
to this Agreement by reason of the extent to which any such party or its counsel
participated in the drafting thereof or by reason of the extent to which any
such provision is inconsistent with any prior draft hereof or thereof.
12.7 Governing Law and Jurisdiction. This Agreement shall be construed
in accordance with and governed by the internal substantive law of the State of
Delaware regardless of the laws that might otherwise govern under principles of
conflict of laws applicable thereto. This Agreement is also subject to any
applicable order or act of the Bankruptcy Court. In the event either party shall
institute a legal action as a result of the default in the other party's
performance under this Agreement, any such action shall be brought exclusively
in the Bankruptcy Court which shall retain exclusive jurisdiction with respect
to the interpretation, performance, and enforcement of this Agreement.
12.8 Counterparts; Effectiveness. This Agreement may be executed in
two or more counterparts (including by means of facsimile signature pages), all
of which shall be considered one and the same agreement, and shall become
effective when one or more such counterparts have been signed by each of the
parties hereto and delivered to the other party (solely for purposes of
effectiveness of this Agreement, such delivery may be in the form of facsimile
signature pages).
12.9 Severability. If any term, provision, covenant or restriction of
this Agreement is determined by a Governmental Entity to be invalid, void or
unenforceable, the remainder of the
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terms, provisions, covenants and restrictions of this Agreement will remain in
full force and effect and will in no way be affected, impaired or invalidated.
IN WITNESS WHEREOF, the parties to this Agreement have caused this
Agreement to be duly executed by their respective authorized officers as of the
day and year first above written.
SELLER:
▇▇▇▇▇▇ CHEMICALS AND PLASTICS
OPERATING LIMITED PARTNERSHIP
By: BCP Management Inc.,
Its General Partner
By:
---------------------------------
Name:
-------------------------------
Title:
------------------------------
PURCHASER:
GEISMAR VINYLS CORPORATION
By:
---------------------------------
Name:
-------------------------------
Title:
------------------------------
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