PURCHASE AGREEMENT
by and between
AMCOR LIMITED
and
SILGAN HOLDINGS INC.
dated as of
February 22, 2006
TABLE OF CONTENTS
ARTICLE I DEFINITIONS AND INTERPRETATION......................................4
Section 1.1 Definitions...............................................4
Section 1.2 Interpretation...........................................18
ARTICLE II PURCHASE AND SALE OF PURCHASED EQUITY AND
PURCHASED ASSETS.........................................................19
Section 2.1 Equity Purchase..........................................19
Section 2.2 Asset Purchase...........................................20
Section 2.3 Assumption of Liabilities................................22
Section 2.4 Purchase Price...........................................24
Section 2.5 Post Closing Adjustment..................................25
Section 2.6 Allocation of Purchase Price.............................28
ARTICLE III THE CLOSING......................................................29
Section 3.1 Time and Place of Closing................................29
Section 3.2 Selling Parties' Deliveries..............................29
Section 3.3 Silgan's Deliveries......................................30
Section 3.4 Failure to Obtain Specified Approvals....................31
Section 3.5 Local Closings...........................................35
ARTICLE IV REPRESENTATIONS AND WARRANTIES OF THE SELLING PARTIES.............36
Section 4.1 Organization and Qualification of the Selling Parties
and the Acquired Companies...............................36
Section 4.2 Authorization............................................37
Section 4.3 Execution; Validity of Agreement.........................37
Section 4.4 Consents and Approvals; No Violations....................37
Section 4.5 Capitalization and Title to the Purchased Equity.........38
Section 4.6 Good Title Conveyed in the Purchased Equity..............38
Section 4.7 Subsidiaries.............................................38
Section 4.8 Financial Statements and Indebtedness....................38
Section 4.9 No Undisclosed Liabilities...............................39
Section 4.10 Absence of Certain Changes...............................40
Section 4.11 Ownership and Condition of Assets; Sufficiency of Assets
and Purchased Equity.....................................41
Section 4.12 Contracts and Commitments................................43
Section 4.13 Insurance................................................45
Section 4.14 Litigation...............................................45
Section 4.15 Environmental Matters....................................45
Section 4.16 Compliance with Laws and Orders..........................47
Section 4.17 Employee Benefit Plans...................................47
i
Section 4.18 Tax Matters..............................................49
Section 4.19 Company Intellectual Property............................50
Section 4.20 Labour Matters...........................................52
Section 4.21 Bank Accounts............................................53
Section 4.22 Brokers or Finders.......................................53
Section 4.23 Receivables and Payables.................................53
Section 4.24 Inventory................................................53
Section 4.25 Books and Records........................................54
Section 4.26 Affiliates Interests.....................................54
Section 4.27 Customers, Suppliers, Distributors Etc...................54
Section 4.28 Products.................................................55
Section 4.29 Powers of Attorney.......................................55
Section 4.30 Computer Systems; Financial Reporting....................55
Section 4.31 Permits..................................................55
Section 4.32 Absence of Certain Business Practices....................55
Section 4.33 Subsidies and Grants.....................................56
Section 4.34 Limitations on Representations and Warranties;
Disclosure...............................................56
ARTICLE V REPRESENTATIONS AND WARRANTIES OF SILGAN...........................56
Section 5.1 Organization.............................................56
Section 5.2 Authorization; Validity of Agreement.....................56
Section 5.3 Consents and Approvals; No Violations....................57
Section 5.4 Acquisition of Purchased Equity for Investment; Ability
to Evaluate and Bear Risk................................57
Section 5.5 Litigation...............................................58
Section 5.6 Investigation by Purchaser; Selling Parties' Liability...58
Section 5.7 Brokers or Finders.......................................59
ARTICLE VI CERTAIN COVENANTS AND AGREEMENTS..................................59
Section 6.1 Interim Operations of the Subject Companies..............59
Section 6.2 Access; Confidentiality..................................60
Section 6.3 Efforts and Actions to Cause Closing to Occur............61
Section 6.4 Publicity................................................62
Section 6.5 Employees; Employee Benefits.............................62
Section 6.6 Intercompany Arrangements................................63
Section 6.7 Maintenance of Books and Records.........................63
Section 6.8 Cooperation in Litigation................................63
Section 6.9 Insurance................................................63
Section 6.10 Intercompany Receivables, Payables and Indebtedness......64
Section 6.11 Name Change..............................................64
Section 6.12 Reorganizations..........................................65
Section 6.13 Assignment of Contracts..................................65
Section 6.14 [Intentionally Omitted]..................................66
Section 6.15 Bulk Transfer Laws.......................................66
Section 6.16 Transitional Services....................................66
ii
Section 6.17 Updating Schedules.......................................66
Section 6.18 Third-Party Indebtedness; Releases.......................67
Section 6.19 Notice of Developments...................................67
Section 6.20 Exclusivity..............................................68
Section 6.21 Audited Financial Statements.............................68
Section 6.22 Collection of Receivables................................69
Section 6.23 Rework and Refunds.......................................70
Section 6.24 German Lease.............................................71
Section 6.25 Newco Italy Contribution.................................71
Section 6.26 Philippine Share Transfer................................71
Section 6.27 Cerebos Supply Agreement.................................71
Section 6.28 Venezuela................................................71
ARTICLE VII CONDITIONS TO CLOSING............................................72
Section 7.1 Conditions to Each Party's Obligation to Effect
the Closing..............................................72
Section 7.2 Conditions to Obligations of Silgan to Effect
the Closing..............................................72
Section 7.3 Conditions to Obligations of the Selling Parties to
Effect the Closing.......................................73
ARTICLE VIII TERMINATION.....................................................73
Section 8.1 Termination..............................................73
Section 8.2 Effect of Termination....................................74
ARTICLE IX TAX MATTERS.......................................................74
Section 9.1 Taxes of the Acquired Companies..........................74
Section 9.2 Contests.................................................76
Section 9.3 Price Adjustment.........................................77
Section 9.4 Exclusive Remedy.........................................77
ARTICLE X SURVIVAL AND REMEDIES..............................................77
Section 10.1 Survival.................................................77
Section 10.2 Indemnification by Selling Parties.......................77
Section 10.3 Environmental Health and Safety Indemnity................78
Section 10.4 [Intentionally Omitted]..................................81
Section 10.5 Indemnification by Silgan................................81
Section 10.6 Method of Asserting Claims...............................81
Section 10.7 Limitations on Damages...................................82
Section 10.8 Exclusive Remedies.......................................84
Section 10.9 Time Limits on Claims....................................84
Section 10.10 Tax Effect and Insurance.................................85
Section 10.11 Knowledge of Claim.......................................85
iii
ARTICLE XI MISCELLANEOUS.....................................................85
Section 11.1 Fees and Expenses........................................85
Section 11.2 Equitable Remedies.......................................87
Section 11.3 Further Assurances.......................................88
Section 11.4 Amendments...............................................88
Section 11.5 Notices..................................................88
Section 11.6 Counterparts.............................................90
Section 11.7 Entire Agreement; No Third Party Beneficiaries...........90
Section 11.8 Severability.............................................90
Section 11.9 Governing Law; Waiver of Jury Trial......................90
Section 11.10 Extension; Waiver........................................91
Section 11.11 Assignability............................................91
Section 11.12 Captions.................................................92
Section 11.13 Schedules................................................92
Section 11.14 Amcor Australia to Act on Behalf of Selling Parties......92
Section 11.15 Time of Essence..........................................92
Section 11.16 Joint and Several Liability..............................92
iv
INDEX TO SCHEDULES
Schedule Numbers Descriptions
(A) Structure Chart
1.1(A) Acquired Company Excluded Liabilities and Excluded
Contracts
1.1(B) Assumed Liabilities
1.1(C) Account Codes for Business Inventory
1.1(D) Account Codes for Business Payables
1.1(E) Account Codes for Business Receivables
1.1(F) Form of Non-Compete Agreement
1.1(G) Permitted Encumbrances
2.2(a)(ix) Assumed Contracts
2.2(a)(xiv) Other Purchased Assets
2.2(b)(xii) Excluded Contracts
2.2(b)(xiv) Other Excluded Assets
3.2(c) Consents Delivered at Closing
3.2(k) Opinions
4.1(A) Jurisdiction of Formation of the Selling Parties and the
Acquired Companies
4.1(B) Directors and Officers of the Acquired Companies
4.4 Conflicts and Consents of the Selling Parties
4.5(a) Capitalization of each Acquired Company
4.7 Subsidiaries
4.8(a) Financial Statements
4.8(b) Indebtedness
4.8(c) Accruals
4.9(a) Undisclosed Liabilities
4.9(b) Disclosure Controls and Procedures
4.9(c) ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Compliance
4.10 Changes in Conduct of Business
4.10(2) Spending on Capital and Capital Maintenance
4.11(a) Owned Real Property and Leased Property
4.11(c) Encumbrances on Tangible Personal Property
4.11(d) Condition of Certain Assets
4.11(f) No Manufacturing Operations
4.12(a) Subject Company Contracts
4.12(b) Defaults under Subject Company Contracts
4.12(d) Notice of Termination of Subject Company Contract
4.12(e) Return of Inventory
4.13 Insurance
4.14 Litigation Matters
4.15 Environmental Matters
4.17(a) Employees
4.17(b) Seller Benefit Plans
4.17(c) Employee Documents Not Provided
4.17(g) Change of Control Payments
4.17(h) Retired Employee Benefits
4.17(j) Wind Up, Termination or Close of any Seller Benefit Plan
Schedule Numbers Descriptions
4.18 Tax Return Information
4.18(k) Taxable Income
4.19(a) Registered Intellectual Property
4.19(b) Intellectual Property Matters
4.20 Labour Matters
4.21 Bank Accounts of the Subject Companies Relating to the
Business
4.22 Brokers or Finders for Selling Parties
4.24 Inventory
4.26 Affiliate Interests
4.27 Customers and Suppliers
4.28 Products
4.29 Powers of Attorney
4.33 Subsidies and Grants
5.2 Authorization
5.3 Conflicts and Consents of Silgan
6.1 Conduct of Business
6.6 Intercompany Arrangements
6.18 Releases
7.1(b) Antitrust Administrator Consents
10.2(k) Funding Benefits
Annex A Holdback Amounts and Specified Interest Target Working
Capital Amounts
Annex B Cerebos Supply Agreement
vi
PURCHASE AGREEMENT
I N T R O D U C T I O N
- - - - - - - - - - - -
THIS PURCHASE AGREEMENT is made and entered into as of February 22, 2006,
by and between Amcor Limited, a company organized under the laws of New South
Wales ("Amcor Australia"), and Silgan Holdings Inc., a company organized under
the laws of Delaware ("Silgan"). Capitalized terms not otherwise defined herein
shall have the meaning ascribed to such terms in Article I hereof.
R E C I T A L S:
WHEREAS, AMB Packaging Pte Ltd, a company organized under the laws of
Singapore ("Amcor Singapore"), Amcor Investments Germany Ltd., a company
organized under the laws of England and Wales ("Amcor Germany"), Amcor Holdings
(Australia) Pty Ltd., a company organized under the laws of New South Wales
("Amcor Holdings Australia"), Amcor European Consolidated Holdings Ltd., a
company organized under the laws of Cyprus ("Amcor ECH"), Amcor Mediflex Ltd., a
company organized under the laws of England and Wales ("Amcor Mediflex"), Amcor
PET Packaging Iberia S.A., a company organized under the laws of Spain ("Amcor
Spain"), Amcor White Cap International Inc., a company organized under the law
of Delaware ("Amcor International"), Amcor White Cap Nederland B.V., a company
organized under the laws of The Netherlands ("Amcor Netherlands"), Amcor PET
Packaging Canada Inc., a company organized under the laws of Canada ("Amcor
Canada"), Amcor PET Packaging do Brasil Ltda, a company organized under the laws
of Brazil ("Amcor PET Brazil"), Amcor Italia s.r.l., a company organized under
the laws of Italy ("Amcor Italy") and Amcor France SNC, a company organized
under the laws of France ("Amcor France SNC"), are collectively referred to as
the "Selling Shareholders" and individually, each a "Selling Shareholder"; and
WHEREAS Amcor Ambalaj Sanayive Ticaret AS, a company organized under the
laws of Turkey ("Amcor Turkey"), Amcor Magyarorszag Csomagolastechnikai KFT, a
company organized under the laws of Hungary ("Amcor Hungary"), Amcor White Cap
Austria GmbH, a company organized under the laws of Austria ("Amcor Austria"),
Amcor White Cap, Inc., a company organized under the laws of Delaware ("Amcor
U.S."), Amcor Australia and Amcor Netherlands are collectively referred to as
the "Asset Sellers" and individually, each an "Asset Seller"; and
WHEREAS the Selling Shareholders and the Asset Sellers are collectively
referred to herein as the "Selling Parties" and individually as a "Selling
Party"; and
WHEREAS Silgan and the Selling Parties are collectively referred to herein
as the "Parties" and individually as a "Party"; and
WHEREAS the Selling Parties are direct or indirect Affiliates of Amcor
Australia; and
WHEREAS Amcor Australia shall cause each of the Selling Parties to sign a
counter-party to this Agreement and shall cause each of the Selling Parties to
perform all of its
obligations under this Agreement, including selling the applicable Purchased
Assets or Purchased Equity; and
WHEREAS Amcor Singapore is the legal and beneficial owner of 99.9995% of
the issued and outstanding Capital Stock of Amcor White Cap Asia Pacific Inc., a
company organized under the laws of the Philippines ("Amcor Asia Pacific") and
of 99.9999% of the issued and outstanding Capital Stock of Amcor White Cap South
East Asia, Inc., a company organized under the laws of the Philippines ("Amcor
South East Asia"); and
WHEREAS Amcor Singapore is the legal and beneficial owner of all of the
issued and outstanding Capital Stock of Amcor White Cap Shanghai Ltd., a company
organized under the laws of China ("Amcor Shanghai"); and
WHEREAS Amcor Singapore is the legal and beneficial owner of forty percent
(40%) of the issued and outstanding Capital Stock of Amcor White Cap Investments
Inc., a company organized under the laws of the Philippines ("Amcor
Investments"); and
WHEREAS Amcor Investments and Amcor South East Asia are the legal and
beneficial owners of 59.9951% and 39.9967%, respectively, of the issued and
outstanding Capital Stock of Amcor White Cap Properties, Inc., a company
organized under the laws of the Philippines ("Amcor Properties"); and
WHEREAS Amcor Germany is the legal and beneficial owner of all of the
issued and outstanding Capital Stock of Amcor White Cap Deutschland GmbH, a
company organized under the laws of Germany ("Amcor Deutschland"); and
WHEREAS Amcor ECH and Amcor Deutschland are the legal and beneficial owners
of ninety-nine percent (99.0%) and one percent (1.0%), respectively, of the
issued and the outstanding Capital Stock of Amcor White Cap Ukraine LLC, a
company organized under the laws of Ukraine ("Amcor Ukraine"); and
WHEREAS Amcor ECH is the legal and beneficial owner of the all of the
issued and outstanding Capital Stock of each of Amcor White Cap Nordiska AB, a
company organized under the laws of Sweden ("Amcor Sweden"), and Amcor White Cap
UK Ltd, a company organized under the laws of England and Wales ("Amcor UK");
and
WHEREAS Amcor Mediflex is the legal and beneficial owner of ninety-eight
point seventy-two percent (98.72%) of the issued and outstanding Capital Stock
of Amcor White Cap Polska Sp. z.o.o., a company organized under the laws of
Poland ("Amcor Polska"); and
WHEREAS Amcor Spain is the legal and beneficial owner of all the issued and
outstanding Capital Stock of Amcor White Cap Espana S.L., a company organized
under the laws of Spain ("Amcor Espana"); and
WHEREAS Amcor Netherlands is the legal and beneficial owner of all but one
(1) share of the issued and outstanding Capital Stock of Amcor White Cap Belgium
N.V., a company organized under the laws of Belgium ("Amcor Belgium"), the
remaining one (1) share being held by Amcor Holdings Australia; and
2
WHEREAS Amcor France SNC is the legal and beneficial owner of all the
issued and outstanding Capital Stock of Amcor White Cap France S.A.S., a company
organized under the laws of France ("Amcor France S.A.S."); and
WHEREAS Amcor International is the legal and beneficial owner of
sixty-three percent (63%) of the issued and outstanding Capital Stock of Amcor
White Cap de Venezuela S.A., a company organized under the laws of Venezuela
("Amcor Venezuela"); and
WHEREAS, Amcor Canada is the legal and beneficial owner of all but one (1)
quota of the issued and outstanding Capital Stock of Amcor White Cap do Brasil
Ltda, a company organized under the laws of Brazil ("Amcor Brazil"), and Amcor
PET Brazil is the legal and beneficial owner of the remaining one (1) quota of
the issued and outstanding Capital Stock of Amcor Brazil; and
WHEREAS the corporate structure referred to in the foregoing paragraphs of
this Preamble is more fully described in Schedule A hereto; and
WHEREAS, prior to the Closing, Amcor Italy has determined to form a
wholly-owned subsidiary under the laws of Italy ("Newco Italy") and has
determined to contribute to Newco Italy at fair market value substantially all
of the assets and certain liabilities and obligations of Amcor Italy, in each
case relating to the operation of the Business (as and to the same extent such
assets and liabilities would be included in the definition of Purchased Assets
and Assumed Liabilities, respectively, if Amcor Italy were an Asset Seller) (the
"Newco Italy Contribution"); and
WHEREAS Amcor Asia Pacific, Amcor South East Asia, Amcor Shanghai, Amcor
Investments, Amcor Properties, Amcor Deutschland, Amcor Ukraine, Amcor Sweden,
Amcor UK, Amcor Polska, Amcor Espana, Amcor Belgium, Amcor France S.A.S., Amcor
Brazil, Amcor Venezuela and Newco Italy are collectively referred to herein as
the "Acquired Companies" and individually as an "Acquired Company"; and
WHEREAS, the Asset Sellers and the Acquired Companies are herein referred
to collectively as the "Subject Companies" and individually as a "Subject
Company"; and
WHEREAS, the Asset Sellers desire to sell, transfer, convey, assign and
deliver to the respective directly or indirectly wholly-owned subsidiaries of
Silgan as shall be designated by Silgan prior to the Closing (collectively, the
"Purchasers") substantially all the properties of the Asset Sellers relating
primarily to the operation of the Business, and Silgan desires that the
Purchasers purchase such properties of the Asset Sellers and to assume certain
liabilities and obligations of the Asset Sellers relating to the operation of
the Business, all in accordance with the terms, conditions and agreements herein
contained; and
WHEREAS the Selling Shareholders desire to sell, transfer and deliver to
the Purchasers all of the issued and outstanding Capital Stock owned by them in
the Acquired Companies (the "Purchased Equity") and Silgan desires that the
Purchasers purchase the Purchased Equity (it being understood that with respect
to the Purchased Equity of Amcor Deutschland and Amcor Sweden, only SWC Holdings
Deutschland GmbH i.G. shall be the Purchaser and in no way shall Silgan be (or
be entitled to designate itself as) the Purchaser or obligated to be the
Purchaser, of
3
Amcor Deutschland or Amcor Sweden), the whole subject to the terms and
conditions hereinafter set forth; and
WHEREAS it is intended by the Parties that the purchase and sale of the
Asset Sellers' properties, the assumption of certain liabilities and obligations
of the Asset Sellers, and the purchase and sale of the Purchased Equity will
transfer the Business to Silgan and its Affiliates on a going concern basis.
NOW, THEREFORE, in consideration of the mutual covenants and agreements
contained herein, and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Parties agree as follows:
ARTICLE I
DEFINITIONS AND INTERPRETATION
Section 1.1 Definitions.
-----------
For all purposes of this Agreement, except as otherwise expressly provided or
unless the context clearly requires otherwise:
"Acquired Company" and "Acquired Companies" are defined in the Recitals.
"Acquired Company Excluded Liabilities" means all liabilities and
obligations of the Acquired Companies of any kind, whether known or unknown,
asserted or unasserted, absolute or contingent, accrued or unaccrued, liquidated
or unliquidated, and whether due or to become due, including any liabilities or
obligations for any non-compliance with applicable Laws prior to the Closing
Date (it being understood that responsibility for liabilities and obligations
for non-compliance with Environmental Laws is addressed exclusively in Sections
10.2(f) and 10.3), and excluding only the following:
(i) The liabilities and obligations of the Acquired Companies included in
the Closing Working Capital;
(ii) The liabilities and obligations of Amcor Shanghai, Amcor Ukraine,
Amcor Polska, Amcor Venezuela, Amcor South East Asia and Amcor Asia Pacific
included in the Closing Indebtedness;
(iii) Subject and without prejudice to the Selling Parties' indemnification
obligations under Sections 10.2 and 10.3 of this Agreement, the liabilities and
obligations of the Acquired Companies under the Real Property Leases (including
the liabilities and obligations of the lessee under the New German Lease (when
executed) to restore the leased property upon the termination of the New German
Lease), the Personal Property Leases, the Licenses and the Contracts to which
any Acquired Company is a party and which relate to the Business, but excluding
those set forth on Schedule 1.1(A) notwithstanding that there may be a deferred
income item on the books of the Subject Companies with respect to such
Contracts;
4
(iv) The liabilities and obligations of the Acquired Companies for benefits
in respect of the Employees and Retired Employees of the Acquired Companies,
including under Seller Benefit Plans of the Acquired Companies;
(v) The liabilities and obligations of the Acquired Companies as set forth
on, and only to the extent set forth on, Schedule 1.1(B), consistent with the
classifications set forth on the Business' chart of account codes set forth on
Schedule 1.1(B) (it being understood that the amounts set forth on Schedule
1.1(B) also include liabilities and obligations of the Asset Sellers referred to
in Section 2.3(a)(v)); and
(vi) The liabilities and obligations of the Acquired Companies otherwise
expressly assumed by the Acquired Companies pursuant to the terms of this
Agreement.
"Affiliate" of any Person means a Person that directly or indirectly
through one or more intermediaries controls, is controlled by, or is under
common control with, the first Person. For purposes of this definition, the term
"control", "controlled by" or "under common control with" means the power,
direct or indirect, to direct or cause the direction of the management and
policies of a Person, whether through the ownership of voting Capital Stock, by
Contract, as trustee or executor, or otherwise.
"Agreement" or "this Agreement" means this Purchase Agreement, together
with the Schedules and Annexes hereto.
"Amcor Financial Procedures and Controls" means the accounting policies and
practices used by the Subject Companies during the fiscal year ended 30 June
2005 consistently applied.
"Ancillary Agreements" means the Non-Compete Agreement, the Transition
Services Agreement, the Specified Interest Management Agreements (if any), the
Local Agreements, the Bills of Sale, the Assumption Agreements and any other
Contract executed in connection with this Agreement and all other agreements,
bills of sale, instruments of conveyance, assignment and assumption,
certificates and other such documents reasonably required to complete, in
accordance with the terms and conditions of this Agreement, the sale, transfer
and delivery to the Purchasers of the Purchased Equity and the Purchased Assets.
"Antitrust Administrator" means any Governmental Entity administering any
Antitrust Laws.
"Antitrust Laws" means the antitrust and competition laws of any country or
of the European Union.
"Arbitrator" is defined in Section 11.1(ii).
"ARD" means the enactment of the Acquired Rights Directive and any
subsequent amendments or replacements in the jurisdiction of the applicable
Asset Seller in Europe.
"Asset Sellers" is defined in the Introduction.
5
"Asset Sellers Pre-Closing Products" is defined in Section 6.23.
"Assumed Contracts" is defined in Section 2.2(a)(ix).
"Assumed Liabilities" is defined in Section 2.3(a).
"Assumption Agreements" is defined in Section 3.3(e).
"Audited Financial Statements" is defined in Section 6.21.
"Benefit Plan" means each employee benefit, incentive-compensation,
deferred-compensation, jubilee benefits, early retirement, profit-sharing,
stock-option, stock-appreciation-right, stock-bonus, stock-purchase,
employee-stock-ownership, savings, severance, change-in-control, pension,
health, medical, welfare, life insurance, fringe benefit plan, program or
arrangement maintained or contributed to by any Subject Company or any Selling
Shareholder with respect to any Acquired Company for the benefit of the
Employees and/or Retired Employees.
"Bills of Sale" is defined in Section 3.2(j).
"Book Cash Balances" means the book cash balances held by any Acquired
Company including, for greater certainty, ▇▇▇▇▇ cash, cash on deposit and cash
equivalents (including, marketable bills of exchange) and the like, and the
▇▇▇▇▇ cash of the Asset Sellers at the facilities included in the Real Property.
"Brazil Litigation" means that certain legal proceeding bearing docket
number 671/00 in the ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇, involving
Remaprint Embalagens Ltda., Amcor Brazil and ▇▇. ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇ (as the
trustee in charge of Remaprint Embalagens Ltda. bankrupt estate), that certain
legal proceeding bearing docket number 115156/01 in the 12th Civil Court of Sao
Paulo, State of Sao Paulo, involving Remaprint Embalagens Ltda., Amcor Brazil
and ▇▇. ▇▇▇▇▇▇ ▇▇▇▇ Junior and any other legal or equitable proceeding before
any other Governmental Entity relating thereto or arising out of the facts
underlying such proceedings, including any labor or employment related legal or
equitable proceedings involving current or former employees of Remaprint
Embalagens Ltda.
"Business" means the developing, manufacturing, marketing, distributing,
selling and servicing of metal, plastic and composite vacuum and non-vacuum
closures for jars and containers and related capping equipment for the food and
beverage industries from plants and/or sales offices in Germany, Italy, Poland,
Turkey, the Philippines, China, Brazil, Austria, Belgium, France, Hungary, the
Netherlands, Spain, Sweden, Ukraine, the United Kingdom and Venezuela under the
"White Cap" brand and the licensing of others to do the same in Israel, Japan,
South Africa, India, Korea, Australia, the United States and New Zealand, all as
conducted by the Subject Companies. For greater certainty, the Business does not
include the closure operations of the Selling Parties or their Affiliates in
Australia and New Zealand, any shareholdings of the Selling Parties or their
Affiliates in the joint venture in North America with Bericap Inc. or the
polyethylene terephthalate (PET) operations of Sellers or their Affiliates for
closures sold to customers of carbonated soft drink and non-hot-filled or
aseptic water (CSDW) for carbonated soft drink and non-hot-filled or aseptic
water products in Latin America and other locations.
6
"Business Day" means a day (other than Saturday or Sunday) on which banks
are generally open for ordinary business in New York, New York, U.S.A.
"Business Inventory" means net inventory consistent with the
classifications set forth in the chart of account codes in Schedule 1.1(C).
"Business Payables" means net payables consistent with the classifications
set forth in the chart of account codes in Schedule 1.1(D).
"Business Receivables" means net receivables consistent with the
classifications set forth in the chart of account codes in Schedule 1.1(E).
"Cap Amount" is defined in Section 10.7.
"Capital Stock" means, as applicable, shares of capital stock, partnership
interests, membership interests, equity interests, quotas, ownership interests
or any similar term under applicable Law.
"Cerebos" is defined in the definition of Specified Approvals.
"Cerebos Agreement" is defined in the definition of Specified Approvals.
"Claim Notice" is defined in Section 10.6(b).
"Closing" is defined in Section 3.1.
"Closing Date" is defined in Section 3.1.
"Closing Date Book Cash Balances" is defined in Section 2.4(c).
"Closing Date Interest Rate" means the interest rate appearing on the
Reuters Screen LIBOR Page as the London Interbank Offer Rate for one (1) month
funding in Euros at approximately 11:00 a.m. (London, England time) on the
Closing Date plus 1.0%.
"Closing Estimated Purchase Price" is defined in Section 2.4(f).
"Closing Indebtedness" is defined in Section 2.4(b).
"Closing Statement" is defined in Section 2.5(a).
"Closing Time" is defined in Section 3.1.
"Closing Working Capital" means the Working Capital as of the close of
business, local time for the Subject Companies, on the day immediately prior to
the Closing Date.
"Company Intellectual Property" means the Intellectual Property owned or
used by the Subject Companies, including the Licenses, and, in the case of the
Asset Sellers, that is used in the Business, including web sites and content
that relate solely to the Business, except that
7
Company Intellectual Property shall exclude the name "Amcor" and all domain
names and web sites that contain the name "Amcor."
"Computer Assets" is defined in Section 4.30.
"Consent" means any approval, consent, permission, ratification, waiver,
license or other authorization.
"Contest" is defined in Section 9.2.
"Contract" means any contract, agreement, license or pending bid or
proposal (which bid or proposal if accepted would result in a binding contract),
whether written or oral.
"Covered Request" is defined in Section 6.7.
"CPA Firm" is defined in Section 2.5(d).
"Current German Lease" is defined in Section 7.2(d).
"Damaged Party" means any Person claiming indemnification under any
provision of Article X.
"Data Room" means the electronic data room established by Amcor Australia
for the purposes of the Transactions containing documents relating to the
Business and the Acquired Companies and made available to Silgan.
"Data Room Disk" means the CD-ROM containing the documentation made
available to Silgan in the Data Room.
"Deductible Amount" is defined in Section 10.7.
"Deeds" is defined in Section 3.2(e).
"De Minimis Amount" is defined in Section 10.7.
"Designees" is defined in Section 6.22.
"Employees" means all employees and workers (as such would be deemed to be
employees if employed in North America) (excluding Retired Employees) in the
employ of or working for the Subject Companies and, in the case of the Asset
Sellers, relating to the Business.
"Encumbrance" means (i) any mortgage, hypothec, charge, lien, claim,
pledge, security interest of any kind or other encumbrance, (ii) any option,
right of first refusal or right of pre-emption, (iii) a contractual restriction
on the use, voting, transfer, receipt of income or exercise of any other
attribute of ownership and (iv) with respect to any real property (or any
leasehold estate in real property), any lease (including any sublease), license
or other agreement respecting use and/or occupancy, easement, restrictive
covenant, condition, limitation, right-of-way, exception or other encumbrance or
burden (including encroachments and other matters of
8
survey) on or affecting such real property or title thereto (or, as the case may
be, the leasehold estate therein).
"Environment" means all, or any part, of the air (including the air within
buildings and natural or man-made structures above or below ground), water and
land.
"Environmental Claims" means any and all directives, administrative,
regulatory or judicial actions, suits, demands, demand letters, claims, liens,
notices of non-compliance or violation, investigations by a Governmental Entity,
proceedings, consent orders or consent agreements relating in any way to any
Environmental Law, Hazardous Substance or any Environmental Permit, including,
(a) any and all claims by Governmental Entities for enforcement, investigation,
cleanup, removal, response, corrective, remedial, monitoring, or other actions,
damages, fines or penalties pursuant to any applicable Environmental Law, and
(b) any and all claims by any one or more Persons seeking damages, contribution,
indemnification, cost recovery, compensation, injunctive or other relief
resulting from a Release or threatened Release of Hazardous Substances or
arising from alleged injury or threat of injury to health, safety, property,
natural resources or the environment.
"Environmental Condition" means any and all conditions and circumstances of
any property, including any Leased Real Property or Owned Real Property, or any
other property formerly owned, operated or leased by the Subject Companies,
relating to or arising or resulting from a failure to comply with any applicable
Environmental Law or Environmental Permit or from a Release or threatened
Release of Hazardous Substances into the Environment.
"Environmental Law" means any Law now or previously in effect regulating,
relating to, or imposing liability or standards of conduct concerning any
Hazardous Substance, drinking water, groundwater, wetlands, landfills, open
dumps, above ground storage tanks, underground storage tanks, solid waste, waste
water, storm water run-off, waste emissions, ▇▇▇▇▇, air emissions, water
discharges, noise emissions, or otherwise relating to pollution or protection of
the outdoor or indoor environment or health or safety.
"Environmental Permit" means any permit, license, approval, consent or
other authorization by a Governmental Entity pursuant to any Environmental Law.
"Estimated Purchase Price" is defined in Section 2.4(f).
"Exchange Act" means the U.S. Securities Exchange Act of 1934, as amended.
"Exchange Rate" means the spot rate of exchange in the relevant currency
against Euros as reported on Reuters Page EURX= on the previous trading day as
the closing (Sydney time) mid price for dealings in the relevant currency.
"Excluded Assets" is defined in Section 2.2(b).
"Excluded Employees" means (i) employees, former employees or workers (as
such would be deemed to be employees if employed in North America) of a Subject
Company who were employed at a particular location of such Subject Company in
its manufacturing operations where all manufacturing operations at such location
have been discontinued and (ii) employees,
9
former employees or workers (as such would be deemed to be employees if employed
in North America) of the Subject Companies who are engaged in any business other
than the Business. Notwithstanding the foregoing, (A) an employee who by
definition is both an Excluded Employee and an Employee at Closing shall be
deemed to be an Employee and (B) an employee who by definition is an Excluded
Employee but subsequently becomes an employee of a Subject Company for the
Business and then becomes a Retired Employee after last being an Employee of a
Subject Company for the Business shall be deemed a Retired Employee.
"Excluded Liabilities" is defined in Section 2.3(b).
"Final Purchase Price" is defined in Section 2.5(f).
"Financial Statements" means (i) the consolidated balance sheet of the
Subject Companies as at June 30, 2005, (ii) the consolidated statements of
profit and loss of the Subject Companies for the twelve-month period ended June
30, 2005, (iii) the consolidated statement of cash flow of the Subject Companies
for the twelve-month period ended June 30, 2005, all of which, excluding the
statements for Amcor Venezuela and Amcor Brazil, were included in consolidation
schedules and were previously audited in accordance with auditing standards
generally accepted in the United States of America as part of the Amcor
Australia audit process, and based on the materiality threshold of Amcor
Australia and were prepared to enable Amcor Australia to prepare consolidated
financial statements and not to report on the Subject Companies as a separate
entity, and (iv) the consolidated balance sheet of the Subject Companies as at
December 31, 2005, (v) the consolidated statements of profit and loss of the
Subject Companies for the six-month period ended December 31, 2005, and (vi) the
consolidated statement of cash flow of the Subject Companies for the six-month
period ended December 31, 2005, all of which constitute management accounts that
have not been audited, all of the foregoing in (i) through (vi) having been
prepared in accordance with IFRS and the Amcor Financial Procedures and
Controls, and (vii) the statutory financial statements of any of the Subject
Companies that have been filed for any period ending on or after July 1, 2004
through December 31, 2005, all of which have been prepared in accordance with
the applicable local generally accepted accounting principles consistently
applied and Amcor's financial controls, (the "Individual Statements"), copies of
all of which are set forth in Schedule 4.8; provided, however, that as regards
the Asset Sellers, the Financial Statements include only such financial
information as is applicable to the Business and not to any other business or
activities carried on by any such Asset Seller, and that for the purposes of the
definition of Financial Statements, "Subject Companies" does not include Amcor
Australia.
"Governmental Entity" means the United States, the European Union, any
foreign, national, supranational, federal, state, provincial, local, municipal
or other government or political subdivision thereof, or any regulatory or
administrative agency, authority or instrumentality of such government or
political subdivision, or any court, agency or tribunal, including an
arbitration.
"Governmental Permits" means any licenses, certificates, permits,
franchises, authorizations, consents, qualifications and approvals, or any
waiver of the foregoing, issued or granted by any Governmental Entity required
by Law for the operation of the Business.
10
"Governmental Sign-Off" is defined in Section 10.3(e)(iii).
"Hazardous Substance" means any element, compound, chemical, contaminant,
pollutant, material, waste or other substance or constituent that is defined or
regulated as such in, or for purposes of any Environmental Law, determined or
identified as hazardous, toxic, biohazardous or dangerous under any applicable
Environmental Law, or the release of which is prohibited or regulated under any
applicable Environmental Law, including, any asbestos, any petroleum, oil
(including crude oil or any fraction thereof), any radioactive substance, any
polychlorinated biphenyls, any toxin, chemical, infectious and medical waste,
microbial matter, and any other substance that gives rise to liability under any
Environmental Law.
"Holdback Amount" means in respect of each of Amcor Shanghai, Amcor
Investments, Amcor Asia Pacific, Amcor South East Asia, Amcor Properties, Amcor
Venezuela and Amcor Brazil, the amount of the Purchase Price specified in
respect of such Subject Company as set forth on Annex A (it being understood
that a single Holdback Amount shall apply to Amcor Investments, Amcor Asia
Pacific, Amcor South East Asia and Amcor Properties, collectively).
"IFRS" means International Financial Reporting Standards.
"Indebtedness" means, with respect to any Person at any date, all
liabilities of such Person for interest-bearing debt, including accrued
interest. Notwithstanding the foregoing, (i) for all purposes hereof the amount
of US $1,379,933 trading balance owing by Amcor Shanghai to Amcor Australia
shall be included as Indebtedness and (ii) for purposes of determining the
Purchase Price, Indebtedness shall not include any amounts that are included in
calculating the Closing Working Capital.
"Individual Statements" is defined within the definition of Financial
Statements.
"Intellectual Property" means (a) all United States, international and
foreign patents and applications therefor; (b) all inventions (whether
patentable or not), ideas, processes, improvements, trade secrets, know how,
technology, technical data, proprietary processes and formulae, all source and
object code, architectures, structures, display screens, layouts, development
tools and all documentation and media constituting, describing the above,
including, manuals, documentation, memoranda and records; (c) all copyrights,
copyright registrations and applications therefor, including derivative and all
other rights corresponding thereto throughout the world; (d) all trade names,
trade dress, logos, common law trademarks and service marks, trademark and
service ▇▇▇▇ registrations and applications therefor throughout the world; (e)
all proprietary databases and data collections and all rights therein throughout
the world; (f) domain names, web sites and related content; (g) intellectual
property rights acquired by license or agreement; and (h) any equivalent rights
to any of the foregoing anywhere in the world.
"Inventory" means raw materials, work-in-progress, finished goods, spare
parts, capping equipment and related spare parts (to the extent classified as
inventory by the Business), accessories and equipment (to the extent classified
as inventory by the Business), packaging materials and other accessories and all
supplies held for use in the Business wherever located,
11
including consignment inventory (where the Subject Company is the consignor) and
inventory on order for or in transit to or from the Subject Companies.
"June 30, 2005 Financial Statements" is defined in Section 6.21.
"Law" means any applicable European Union, United States, foreign,
national, supranational, federal, provincial, state, municipal or local statute,
common law, rule, regulation, ordinance, permit, order, writ, injunction,
directive, judgment, decree or any other pronouncement of any Governmental
Entity having the effect of law.
"Leased Real Property" means, collectively, the real property (including
all improvements thereon) that is leased, subleased, licensed for occupation, or
otherwise demised, to a Subject Company (and in the case of the Asset Sellers,
used, operated or maintained in connection with, or otherwise related to, the
Business), all as more particularly set forth on Schedule 4.11(a).
"Licenses" means all Contracts pursuant to which a Subject Company has any
rights in or to any Company Intellectual Property from any Person, and all
Contracts pursuant to which a Subject Company has licensed or transferred any
rights in or to any Company Intellectual Property to any Person.
"Local Agreements" is defined in Section 3.5.
"Local Closing" is defined in Section 3.5.
"Losses" means any and all demands, claims, actions or causes of action,
assessments, losses, damages, liabilities, costs and expenses, including
interest, penalties, and reasonable attorneys' fees and disbursements, excluding
any punitive, consequential or indirect damages (except as such punitive,
consequential or indirect damages are paid to third parties).
"Major Customer" is defined in Section 4.27.
"Major Supplier" is defined in Section 4.27.
"Management Fee" is defined in Section 3.4(a).
"Material Adverse Effect" means any effect, event or occurrence that is
materially adverse to the assets, liabilities (contingent or otherwise), results
of operations (both historical and in the future (including cost reduction
initiatives)) or financial condition (both historical and in the future) of the
Business, the Purchased Assets and the Acquired Companies, taken as a whole, or
that has a material adverse effect on the ability of the Selling Parties to
consummate the transactions contemplated by, and discharge their obligations
under, this Agreement and the Ancillary Agreements; provided, however, that none
of the following shall be deemed, either alone or in combination, to constitute,
and none of the following shall be taken into account in determining whether
there has been or will be, a Material Adverse Effect: (i) the fact that any
Subject Company fails to meet any internal or published projections, forecasts,
or revenue or earnings predictions for any period; it being understood, however,
that the underlying reason or cause for such failure may still constitute a
Material Adverse Effect; (ii) any adverse change,
12
effect, event, occurrence, state of facts or development to the extent
attributable to the announcement or pendency of the Transactions (including any
cancellations of or delays in customer orders, any reduction in sales, any
disruption in supplier, distributor, partner or similar relationships or any
loss of employees); (iii) any adverse change, effect, event, occurrence, state
of facts or development attributable to conditions affecting (a) the industries
in which the Business operates (which adverse changes or effects do not affect
the Business, the Purchased Assets and the Acquired Companies in a materially
disproportionate manner) or (b) general economic conditions not uniquely related
to the Business; (iv) terrorist activities; (v) any adverse change, effect,
event, occurrence, state of facts or development arising from or relating to any
change in accounting requirements or principles or the interpretation thereof
(which adverse changes, effects, events, occurrences, state of facts or
developments do not affect the Business, the Purchased Assets and the Acquired
Companies in a materially disproportionate manner) other than any such change
implemented by the Selling Parties and not required under IFRS or applicable
local generally accepted accounting principles or (vi) any adverse change,
effect, event, occurrence, state of facts or development arising from or
relating to any change in applicable Laws or the interpretation or enforcement
thereof (which adverse changes, effects, events, occurrences, state of facts or
developments do not affect the Selling Parties' ability to consummate the
Transactions). References in this Agreement to thresholds shall not be deemed to
be evidence of a Material Adverse Effect or materiality.
"Newco Italy" is defined in the Recitals.
"Newco Italy Contribution" is defined in the Recitals.
"New German Lease" is defined in Section 7.2(d).
"Non-Compete Agreement" means the non-compete agreement to be entered into
between, Silgan and Amcor Australia at Closing, in the form attached as Schedule
1.1(F).
"Offeree Notice" is defined in Section 3.4(c).
"Operating Document" means, with respect to any entity, the bylaws,
operating agreement, partnership agreement, or other applicable documents
relating to the operation, governance or management of such entity.
"Organizational Document" means, with respect to any entity, the articles
of incorporation, certificate of incorporation, articles of organization,
articles of association, certificate of limited partnership or other applicable
organizational or charter documents relating to the creation or organization of
such entity.
"Owned Real Property" means, collectively, all the real property (including
all improvements thereon) that is owned by a Subject Company (and in the case of
the Asset Sellers, used, operated or maintained in connection with, or otherwise
related to, the Business), all as more particularly set forth on Schedule
4.11(a).
"Party" and "Parties" are defined in the Introduction.
"Payment Notice" is defined in Section 6.23.
13
"Permitted Encumbrances" means (i) liens for water, sewer and other utility
charges not yet due and payable; (ii) mechanics', carriers', workers',
repairers', materialmens', warehousemens' and similar liens arising or incurred
in the ordinary course of business and not related to delinquent amounts; (iii)
imperfections of title, easements, rights-of-ways, covenants and encumbrances,
if any, which do not materially and adversely affect the marketability or title
to such real property or materially detract from the value of or materially
interfere with the present use of such real property subject thereto or affected
thereby and not related to delinquent amounts; (iv) liens in favour of any
lessor or licensor for rent or royalties to become due or for other obligations
or acts, the performance of which is required under leases, subleases or
licenses, so long as the payment of such rent, royalties or the performance of
such other obligation or act is not delinquent beyond any cure period; (v) liens
of employees for salaries or wages earned but not yet payable; (vi) liens of
unpaid vendors of personal property, or other similar liens, in each case
arising in the ordinary course of business for charges that are not delinquent
beyond any cure period; (vii) any lease of Tangible Personal Property in the
ordinary course whereby a Subject Company is the lessor; (viii) permitted use
provisions in the Real Property Leases listed in Schedule 4.11(a); (ix)
Encumbrances for local property Taxes and assessments arising in the ordinary
course of business and not delinquent beyond any cure period; and (x)
Encumbrances set forth on Schedule 1.1(G).
"Person" means a natural person, partnership, limited partnership,
corporation, limited liability company, business trust, joint stock company,
trust, unincorporated association, joint venture, Governmental Entity or other
entity or organization.
"Personal Property Lease" means each lease pursuant to which Tangible
Personal Property is leased to a Subject Company.
"Pre-Closing Products" is defined in Section 6.23.
"Purchase Price" is defined in Section 2.4.
"Purchase Price Allocation" is defined in Section 2.6.
"Purchased Assets" is defined in Section 2.2(a).
"Purchased Equity" is defined in the Recitals.
"Purchasers" is defined in the Recitals.
"Real Property" means the Leased Real Property and the Owned Real Property.
The term "real property" when used herein and not capitalized, means the
applicable parcel of land such term describes, together with all the buildings,
structures and improvements located thereon, any and all privileges, easements,
rights of way, appurtenances, and rights belonging to and enuring to the benefit
thereof, and any and all fixtures and systems now upon or hereafter placed on
said parcel and used in connection with the use or operation of such buildings,
structures or improvements.
"Real Property Leases" means, collectively, the leases, subleases or other
agreements pursuant to which the Subject Companies are the lessees of the Leased
Real Property.
14
"Receivables" means all outstanding notes, book debts and trade accounts
receivable, including trade accounts receivable from the Selling Parties and
Affiliates of the Selling Parties and balances due from current and former
employees of the Subject Companies.
"Refunds" means payments to customers of the Acquired Companies or the
Purchasers for or in respect of or in connection with Pre-Closing Products that
do not meet applicable warranties, which payments shall include, to the extent
paid to the customer, (i) the sales price (including freight) charged to the
customer and (ii) all costs incurred by the customer in connection therewith
(such as product recall costs, loss of product costs, etc.).
"Refusal Period" is defined in Section 3.4(c).
"Refusal Transfer Period" is defined in Section 3.4(c).
"Registered Intellectual Property" is defined in Section 4.19(a).
"Release" means any spilling, leaking, pumping, pouring, emitting,
emptying, injecting, depositing, disposing, discharging, dispersal, escaping,
dumping, or leaching into the indoor or outdoor environment, including land,
air, surface water, soil or groundwater (including the abandonment or discarding
of barrels, containers, and other receptacles containing Hazardous Substances)
or as otherwise defined under Environmental Laws.
"Repurchase Date" is defined in Section 6.22.
"Responsible Party" means any Person against whom a claim is being asserted
under any provision of Article X.
"Retained Receivables" is defined in Section 6.22.
"Retired Employees" means former employees of the Subject Companies for the
Business (other than Excluded Employees) who have either retired, been laid-off,
have deceased, have commenced employment elsewhere or are unemployed and that
have a contingent or vested benefit for which the Subject Companies are
responsible.
"Rework" means Pre-Closing Products identified by customers of the Subject
Companies of the Business as not meeting applicable warranties and that require
replacement. Rework shall be valued at the cost to the Acquired Companies or the
Purchasers of direct materials, labor, allocated manufacturing overhead and
freight; provided that for any six-month period all Rework in excess of the
average historical level for six months (excluding unusual items) for the
applicable Acquired Company or Asset Seller shall be valued at a ▇▇▇▇-up of 25%
over the cost to the Acquired Companies or the Purchasers of direct materials,
labor, allocated manufacturing overhead and freight.
"Seller Benefit Plans" is defined in Section 4.17(b).
"Selling Parties' Knowledge" means the knowledge of ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ Spiesmacher, ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇, Klass ▇▇▇▇▇▇ (as to all
human resources, employee benefits, labor and other related matters only),
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ (as to all
15
environmental and other related matters only), ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇ (as
to all matters relating to Amcor Asia Pacific, Amcor South East Asia, Amcor
Investments and Amcor Properties, collectively, and the business of such
Acquired Companies only), ▇▇▇▇ ▇▇▇▇ (as to all matters relating to Amcor
Shanghai and the business of Amcor Shanghai only), ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ (as to all
matters relating to Amcor Brazil and the business of Amcor Brazil only),
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ (as to all matters relating to Amcor Venezuela and the
business of Amcor Venezuela only), ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ (as to all matters
relating to Amcor Italy (and Newco Italy upon the occurrence of the Newco Italy
Contribution) and the business of Amcor Italy and Newco Italy only), ▇▇▇▇▇ ▇▇▇▇▇
(as to all matters relating to Amcor Polska and the business of Amcor Polska
only) and Abubekir Yueksel (as to all matters relating to Amcor Turkey and the
business of Amcor Turkey), without independent investigation. For purposes of
Section 4.27 hereof, Selling Parties' Knowledge shall only include the knowledge
of ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ Spiesmacher and ▇▇▇▇▇▇ ▇▇▇▇▇.
"Selling Party" and "Selling Parties" are defined in the Introduction.
"Selling Shareholder" and "Selling Shareholders" are defined in the
Introduction.
"Silgan" is defined in the Introduction.
"Silgan Indemnitee" means Silgan and the Purchasers and their respective
directors, officers, employees, Affiliates, agents and representatives and their
respective successors and assigns.
"Silgan's Objection" is defined in Section 2.5(c).
"Specified Approvals" means (i) in respect of Amcor Shanghai, all Consents
of Governmental Entities required for the sale of the Purchased Equity of Amcor
Shanghai to the applicable Purchaser; (ii) in respect of Amcor Brazil, the
final, non-appealable judgment of the Brazilian Courts in favor of Amcor Brazil
in respect of that certain legal proceeding bearing docket number 671/00 in the
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇, involving Remaprint Embalagens Ltda,
Amcor Brazil and ▇▇. ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇ (as the trustee in charge of
Remaprint Embalagens Ltda. bankrupt estate) and any other bankruptcy proceeding
involving directly or indirectly Amcor Brazil as a debtor, as confirmed by an
opinion of Amcor Brazil's legal counsel in Brazil in form and substance
reasonably satisfactory to Silgan; (iii) in respect of Amcor Venezuela, (a)
written waivers or the non-exercise within the applicable time period of any
rights of first refusal of shareholders or other holders of any equity interest
(other than Amcor Australia or any of its Affiliates) in Amcor Venezuela,
confirmed by a certificate of an officer of Amcor Australia that the applicable
waivers were received or the applicable time periods have expired, together with
the originals of such waivers, all in form and substance reasonably satisfactory
to Silgan and (b) all Book Cash Balances of Amcor Venezuela as of the close of
business, local time for Amcor Venezuela, on the day immediately prior to the
Closing Date shall have been distributed out of such company; provided such
distributions or payments are net of any Taxes payable by Amcor Venezuela with
respect thereto, it being understood that the applicable Purchaser shall
cooperate in effecting such distributions; and (iv) in respect of Amcor Asia
Pacific, Amcor South East Asia, Amcor Investments and Amcor Properties,
collectively, an amendment to the Supply Agreement, dated April 6, 2001, among
Cerebos
16
Pacific Limited ("Cerebos"), Amcor Deutschland and Amcor South East Asia, as
amended (the "Cerebos Agreement"), containing the terms and conditions set forth
on Annex B. Solely for purposes of determining whether the closing of the
purchase and sale of a Specified Interest must occur under this Agreement and
not for the purposes of determining any damages to which any Party may be
entitled pursuant hereto, if Amcor Australia disputes any determination by
Silgan as to whether a Specified Approval shall have been obtained and the
matter is adjudicated in accordance with Section 11.9 hereof, the issue upon
adjudication for such purposes shall be whether such Specified Approval was in
fact obtained and not whether Silgan acted reasonably in determining whether
such Specified Approval was obtained.
"Specified Interest" is defined in Section 3.4(a).
"Specified Interest Adjustment Amount" is defined in Section 2.5(h).
"Specified Interest Management Agreements" is defined in Section 3.4(d).
"Specified Interest Target Working Capital Amount" means in respect of each
of Amcor Shanghai, Amcor Investments, Amcor Asia Pacific, Amcor South East Asia,
Amcor Properties, Amcor Venezuela and Amcor Brazil, the amount of the Target
Working Capital Amount specified in respect of such Subject Company as set forth
on Annex A (it being understood that a single Specified Interest Target Working
Capital Amount shall apply to Amcor Investments, Amcor Asia Pacific, Amcor South
East Asia and Amcor Properties, collectively).
"Specified Time Period" means with respect to Amcor Brazil two (2) years
after the Closing Date, and with respect to each of the other Specified
Interests six (6) months after the Closing Date.
"Subject Company" and "Subject Companies" are defined in the Recitals.
"Subject Company Contract" is defined in Section 4.12(a).
"Tangible Personal Property" means all tangible property of the Asset
Sellers which is used in connection with the Business and all tangible property
of the Acquired Companies, in each case, including all equipment, spare parts
and accessories and other than Real Property, Intellectual Property and
Inventory.
"Target Working Capital Amount" means (euro)64.0 million, subject to
adjustment as set forth in Section 2.5(h).
"Tax" or "Taxes" means any tax or taxes of any kind or nature, however
denominated, including any federal, regional, state, provincial, local and
foreign income or gross receipts tax, alternative or add-on minimum tax, value
added tax, sales and use tax, customs duty or any other tax, charge fee, levy or
other assessment including property, transfer, occupation, service, license,
payroll, franchise, excise, withholding, ad valorem, severance, stamp, premium,
windfall profit, employment, rent or other tax of any kind whatsoever, and
including any interest, penalties or additions to tax or additional amounts in
respect of the foregoing, including any transferee or secondary liability for a
tax and any liability assumed by agreement or arising as a
17
result of being or ceasing to be a member of any affiliated group, or being
included or required to be included on any Tax Return relating thereto.
"Tax Return" means any return or report relating to Taxes, including any
Schedule or attachment thereto, and including any amendment thereof or
supplement thereto.
"Third Party Claim" is defined in Section 10.6(a).
"Transactions" means the sale of the Purchased Assets and the Purchased
Equity to the Purchasers, the assumption of the Assumed Liabilities by the
Purchasers, and all the transactions provided for or contemplated by this
Agreement and in any Ancillary Agreement.
"Transition Services Agreement" is defined in Section 3.2(l).
"Turkey Determination" is defined in Section 11.1(i).
"Turkey Notice" is defined in Section 11.1(i).
"Uncollected Receivables" is defined in Section 6.22.
"Update Period" is defined in Section 6.17.
"Working Capital" means, as at a particular date, the sum of the Business
Receivables and Business Inventory, to the extent, and only to the extent, that
such items are included in the Purchased Assets or are assets of the Acquired
Companies minus Business Payables, to the extent, and only to the extent, that
such Business Payables are included in the Assumed Liabilities or are
liabilities of the Acquired Companies and are not Acquired Company Excluded
Liabilities.
Section 1.2 Interpretation.
--------------
(a) The headings contained in this Agreement are for reference purposes only and
shall not affect in any way the meaning or interpretation of this Agreement.
(b) Whenever the words "include," "includes" or "including" are used in this
Agreement, they shall be deemed to be followed by the words "without
limitation."
(c) The words "hereof," "herein" and "herewith" and words of similar import
shall, unless otherwise stated, be construed to refer to this Agreement as a
whole and not to any particular provision of this Agreement, and Article,
Section, recitals and Schedule references are to the Articles, Sections,
recitals and Schedules of or to this Agreement unless otherwise specified.
(d) The meaning assigned to each term defined herein shall be equally applicable
to both the singular and the plural forms of such term, and words denoting any
gender shall include all genders. Where a word or phrase is defined herein, each
of its other grammatical forms shall have a corresponding meaning.
18
(e) A reference to any party in any Contract shall include such party's
successors and permitted assigns. A reference to a Contract shall include all
amendments and modifications thereto provided that such amendment or
modification is not made in breach of this Agreement.
(f) The Parties have participated jointly in the negotiation and drafting of
this Agreement. In the event an ambiguity or question of intent or
interpretation arises, this Agreement shall be construed as if drafted jointly
by the Parties, and no presumption or burden of proof shall arise favouring or
disfavouring any Party by virtue of the authorship of any provisions of this
Agreement.
(g) All references in this Agreement or any Ancillary Agreement to the Asset
Sellers (including all financial information contained in or delivered or
prepared pursuant to this Agreement or any Ancillary Agreement that relates to
or concerns the Asset Sellers) are made only with respect to (and include only
such financial information as is applicable to) the Business, the Purchased
Assets and the Assumed Liabilities and not to any other business or activities
carried on by any such Asset Seller. The fact that certain provisions of this
Agreement specifically provide as set forth in this Section 1.2(g) shall not
detract from the generality of this Section 1.2(g).
(h) References to any document being "in the agreed form" shall mean such
document signed for identification purposes only by or on behalf of the Selling
Parties and Silgan.
(i) References to a Party shall include any permitted assignee or successor to
such Party in accordance with this Agreement. References to an Acquired Company
shall include all subsidiaries or subsidiary undertakings of such Acquired
Company.
(j) Where it is necessary to determine a monetary amount, limit or threshold set
out in this Agreement and the value of any sum to be taken into account in
making that determination is expressed in a currency other than Euros, such sum
shall be converted into Euros at the Exchange Rate on the relevant date, which
for the purposes of any claim under this Agreement shall be the Business Day on
which the relevant Party receives written notification of that claim; provided,
however, that for the purposes of setting forth information on the Schedules
hereto the relevant date shall be the date hereof.
ARTICLE II
PURCHASE AND SALE OF PURCHASED EQUITY AND PURCHASED ASSETS
Section 2.1 Equity Purchase.
---------------
Subject to Section 3.4, at the Closing, on the terms and subject to the
conditions set forth in this Agreement, the Selling Shareholders shall sell,
transfer, assign, convey and deliver to the respective Purchasers as designated
by Silgan prior to Closing all the Purchased Equity, free and clear of all
Encumbrances, other than Permitted Encumbrances, and Silgan shall cause such
Purchasers to purchase and accept the Purchased Equity from the Selling
Shareholders. As with respect to the Purchased Equity of Amcor Deutschland and
Amcor Sweden, only SWC Holdings Deutschland GmbH i.G. shall be the Purchaser and
in no way shall Silgan be (or be entitled to designate itself as) the Purchaser,
or be obligated to be Purchaser, of Amcor Deutschland or Amcor Sweden.
19
Section 2.2 Asset Purchase.
--------------
(a) Description of Assets. Subject to Section 3.4, at the Closing, on the terms
and subject to the conditions set forth in this Agreement, the Asset Sellers
shall sell, transfer, assign, convey and deliver to the respective Purchasers as
designated by Silgan prior to Closing, and Silgan shall cause such Purchasers to
purchase and accept free and clear of all Encumbrances, other than Permitted
Encumbrances, all right, title and interest of the Asset Sellers in, to and
under all of the assets, properties, rights and interests of each of the Asset
Sellers of every kind, character and description, tangible or intangible, real,
personal or mixed, wherever located, and used in the Business, including the
following but specifically excluding only the Excluded Assets (collectively, the
"Purchased Assets"):
(i) Real Property. The fee title or other comparable title to all the Owned
Real Property and the lessee's interest under each and all of the Real Property
Leases;
(ii) Tangible Personal Property. All of the Asset Sellers' Tangible
Personal Property (other than Inventory) as it shall exist at the Closing Time;
(iii) Inventory. All of the Inventory of the Asset Sellers as it shall
exist at the Closing Time;
(iv) Receivables. All Receivables of the Asset Sellers to the extent
arising in connection with the Business as such shall exist at the Closing Time;
(v) Intellectual Property. All rights of the Asset Sellers in the Company
Intellectual Property (subject to applicable grants, restrictions and
limitations contained in the Licenses);
(vi) Books and Records. All of the Asset Sellers' books, records, ledgers,
files, documents, correspondence, lists, plans, specifications, surveys,
drawings, advertising and promotional materials, engineering reports, and
subject to applicable Law, personnel records of all employees, in each case
relating to the Business (in whatever form or medium), provided, however, that
the Asset Sellers shall be allowed to retain (a) original personnel files
pertaining to employees of the Asset Sellers terminated prior to the Closing
Time, (b) copies of all personnel files pertaining to current employees of the
Asset Sellers at the Closing Time, and (c) copies of all employer's liability or
worker's compensation claim files of the Asset Sellers as such shall exist at
the Closing Time;
(vii) Prepaid Items. All of the Asset Sellers' deferred charges, advance
payments, prepaid and deferred items (including prepaid rent), credits, security
and other deposits, claims for refunds, rights of offset, and credits of all
kinds, in each case to the extent related to the Purchased Assets or the
Business as such shall exist at the Closing Time;
(viii) Personal Property Leases. Subject to Section 6.13, the Personal
Property Leases of the Assets Sellers as such shall exist at the Closing Time;
(ix) Contracts. Subject to Section 6.13, all Contracts (other than the
Licenses, the Real Property Leases and the Personal Property Leases) of the
Asset Sellers which relate to the Business, including those set forth on
Schedule 2.2(a)(ix) but excluding those set forth on
20
Schedule 2.2(b)(xii) as such shall exist at the Closing Time. Those Contracts
being assumed pursuant to this Section 2.2(a) are collectively referred to as
the "Assumed Contracts";
(x) Governmental Permits. Subject to Section 6.13, all Governmental Permits
held by the Asset Sellers which are issued, granted or used in connection with
the Business as such shall exist at the Closing Time;
(xi) Goodwill. All of the goodwill of the Asset Sellers exclusively
relating to the Business;
(xii) Warranties. All rights under or pursuant to warranties,
representations and guarantees (express or implied) made by suppliers,
manufacturers or contractors in connection with products or services provided to
the Asset Sellers in connection with the Business and the Purchased Assets;
(xiii) ▇▇▇▇▇ Cash. All ▇▇▇▇▇ cash of the Asset Sellers at the facilities
included in the Real Property; and
(xiv) Other Purchased Assets. All of the Asset Sellers' right, title and
interest in and to those assets, rights and properties set forth on Schedule
2.2(a)(xiv).
(b) Excluded Assets. The Purchased Assets to be purchased and sold hereunder,
and the term "Purchased Assets" as used herein, shall not include the following
properties (the "Excluded Assets") of the Asset Sellers:
(i) Cash. All of the Asset Sellers' cash, commercial paper, certificates of
deposit and other bank deposits, treasury bills and other cash equivalents,
other than ▇▇▇▇▇ cash of the Asset Sellers at the facilities included in the
Real Property;
(ii) Insurance Coverage Maintained on Behalf of Asset Sellers. All
casualty, liability or other policies of insurance or coverage maintained on
behalf of any Asset Seller or Affiliate of any Asset Seller and any prepaid
insurance premiums existing as of the Closing Time related to such policies;
(iii) Tax Refunds; Claims. All refunds and claims for refunds of any Tax
due to the Asset Sellers;
(iv) Books and Records. All books and records of the Asset Sellers not
relating to the Business;
(v) Corporate Rights. The right or franchise of the Asset Sellers to be an
entity and all documents pertaining thereto, including Organizational Documents,
Operating Documents, corporate seals, minute books and stock books;
(vi) Indemnity Rights. All indemnity and contribution rights of the Asset
Sellers granted to or owed by third parties to the extent not related to the
Purchased Assets or the Assumed Liabilities, and any and all rights or assets to
the extent arising from and related to the
21
defense, release, compromise, discharge or satisfaction by the Asset Sellers of
Excluded Liabilities;
(vii) Causes of Action. All of the Asset Sellers' causes of action,
judgments, claims and demands of whatever nature against third parties not
relating to the Business;
(viii) Prepaid Items. All of the Asset Sellers' deferred charges, advance
payments, prepaid and deferred items (including prepaid rent), credits, security
and other deposits, claims for refunds, rights of offset, and credits of all
kinds, including Taxes, in each case to the extent not related to the Purchased
Assets or the Business;
(ix) Rights under this Agreement. The Asset Sellers' rights under this
Agreement;
(x) Amcor Name. Except as set forth in Section 6.11, all right, title and
interest in the name "Amcor" and any derivations thereof, and any signage
bearing such name;
(xi) Bank Accounts. All bank accounts, safe deposit boxes, checking
accounts or other accounts of any nature maintained by or on behalf of the Asset
Sellers;
(xii) Contracts. All Contracts not relating to the Business and those
Contracts set forth on Schedule 2.2(b)(xii);
(xiii) Real Property. All right, title and interest of the Asset Sellers in
real property other than the Real Property; and
(xiv) Other Excluded Assets. Those properties, if any, set forth on
Schedule 2.2(b)(xiv).
Section 2.3 Assumption of Liabilities.
-------------------------
(a) Liabilities to be Assumed by the Purchasers. As partial consideration for
the consummation of the Transactions, at the Closing, Silgan shall cause the
respective Purchasers purchasing the Purchased Assets as designated by Silgan
prior to Closing (each such Purchaser to assume the liabilities or obligations
set forth below that correspond to the Purchased Assets it shall acquire
pursuant to this Agreement) to assume and agree, and as of the Closing Time
shall be deemed to have assumed and agreed, to perform when due and discharge in
accordance with their respective terms, only the following liabilities and
obligations of the Asset Sellers (the "Assumed Liabilities"):
(i) The liabilities and obligations of the Asset Sellers included in the
Closing Working Capital;
(ii) The accounts payable of the Asset Sellers described in Section
6.10(a);
(iii) Subject and without prejudice to the Selling Parties' indemnification
obligations under Sections 10.2 and 10.3 of this Agreement, the liabilities and
obligations of the Asset Sellers under the Real Property Leases, the Personal
Property Leases, the Licenses and the Assumed Contracts, only to the extent such
Real Property Leases, Personal Property Leases,
22
Licenses or Assumed Contracts are assigned to the respective Purchasers,
notwithstanding that there may be a deferred income item on the books of the
Subject Companies with respect to such Contracts;
(iv) The liabilities and obligations of the Asset Sellers for benefits in
respect of the Employees and Retired Employees of the Asset Sellers, including
under Seller Benefit Plans that are Assumed Contracts;
(v) The liabilities and obligations of the Asset Sellers as set forth on,
and only to the extent set forth on, Schedule 1.1(B), consistent with the
classifications set forth on the Business' chart of account codes set forth on
Schedule 1.1(B) (it being understood that the amounts set forth on Schedule
1.1(B) also include liabilities and obligations of the Acquired Companies
referred to in clause (v) of the definition of Acquired Company Excluded
Liabilities); and
(vi) The liabilities and obligations of the Asset Sellers otherwise
expressly assumed by the Purchasers pursuant to the terms of this Agreement.
(b) Excluded Liabilities. Other than the Assumed Liabilities, the Purchasers
shall not assume or become responsible for, and shall not be deemed to have
assumed or to have become responsible for, any liabilities and obligations of
any Asset Seller of any kind, whether known or unknown, asserted or unasserted,
absolute or contingent, accrued or unaccrued, liquidated or unliquidated, and
whether due or to become due (collectively, the "Excluded Liabilities"),
including the following:
(i) any liability or obligation of the Asset Sellers pertaining to any
Excluded Assets;
(ii) any liability or obligation of the Asset Sellers with respect to
Income Taxes;
(iii) any liability or obligation of the Asset Sellers in respect of
Excluded Employees, including pursuant to any retention agreements, severance
agreements, change of control agreements or other similar plans, policies or
arrangements;
(iv) any liability or obligation of the Asset Sellers (A) related to any
Employees or Retired Employees other than (a) liabilities and obligations of the
Asset Sellers for benefits in respect of the Employees or Retired Employees,
including under Seller Benefit Plans that are Assumed Contracts, (b) liabilities
and obligations included in the Closing Working Capital and (c) liabilities and
obligations under the Assumed Contracts or (B) that is incurred as a result of
the Transactions pursuant to any retention agreements, severance agreements,
change of control agreements or other similar plans, policies or arrangements
with or concerning the Employees or Retired Employees;
(v) any liability or obligation of any Asset Seller arising out of or
relating to any facility that any Asset Seller may have owned, leased, operated
or otherwise used at any time that is not included in the Real Property,
including any such liabilities or obligations resulting from the generation,
use, handling, presence, treatment, storage, transportation, disposal or Release
of any Hazardous Materials at any such facility or any violations of applicable
Environmental Laws on, prior to or after the Closing Date;
23
(vi) any liability or obligation of the Asset Sellers arising out of any
action or proceeding actually initiated and pending as of the Closing and not
listed on Schedule 1.1(B) or, if listed on Schedule 1.1(B), to the extent
exceeding the amount of the accrual as set forth on Schedule 1.1(B);
(vii) any liability or obligation of the Asset Sellers for any
non-compliance with applicable Laws prior to the Closing Date (it being
understood that responsibility for liabilities and obligations for
non-compliance with Environmental Laws is exclusively addressed in Sections
10.2(f) and 10.3); and
(viii) all liabilities of Selling Parties under this Agreement, any
Ancillary Agreement or any other agreement between a Selling Party and Silgan or
any of the Purchasers.
Section 2.4 Purchase Price.
--------------
The following sets forth the aggregate purchase price (subject to adjustment as
provided in Sections 2.4(g) and 2.5 and subject to the terms of Section 3.4) to
be paid, in addition to the assumption of the Assumed Liabilities, by Silgan or
the Purchasers to the Selling Parties for the Purchased Equity and the Purchased
Assets (the "Purchase Price"), namely,
(a) (euro) 230 million, minus
(b) the excess of the aggregate amount of Indebtedness of Amcor Shanghai, Amcor
Ukraine, Amcor Polska, Amcor Venezuela, Amcor South East Asia and Amcor Asia
Pacific (whether owed to third parties or, in the case of Amcor Ukraine and
Amcor China only, to the Selling Parties or their Affiliates (other than another
Acquired Company)) over the aggregate amount of Indebtedness owed to the
Acquired Companies by third parties (other than the Selling Parties or their
Affiliates, including the Acquired Companies) in each case, existing as of the
close of business, local time for the Subject Companies, on the day immediately
prior to the Closing Date (collectively the "Closing Indebtedness"), it being
acknowledged that if the Closing Indebtedness is a negative number, it shall be
added to the amount set forth in Section 2.4(a), plus
(c) the amount (if any) of the Book Cash Balances (excluding the Book Cash
Balances of Amcor Venezuela) existing as of the close of business, local time
for each Acquired Company, net of any overdrafts in respect of bank accounts of
such Acquired Company, all on the day immediately prior to the Closing Date (the
"Closing Date Book Cash Balances") up to (euro)11.5 million in excess of ▇▇▇▇▇
cash in the aggregate; provided that to the extent such amount exceeds (euro)1.5
million in the aggregate, only one-half of such excess amount shall constitute
Closing Date Book Cash Balances for the purposes of the Purchase Price
notwithstanding that all Acquired Companies shall retain all Book Cash Balances
after the Closing; provided, further that the Book Cash Balances in excess of
(euro)1.5 million reside in the Acquired Companies reasonably acceptable to
Silgan in good faith, it being understood that no Acquired Company shall have
overdrafts in respect of bank accounts of such Acquired Company aggregating in
excess of the Book Cash Balances of such Acquired Company, minus
(d) the amount (if any) by which the Closing Working Capital is less than the
Target Working Capital Amount, plus
24
(e) the amount (if any) by which the Closing Working Capital is greater than the
Target Working Capital Amount.
(f) Not later than ten (10) Business Days before the Closing, the Selling
Parties will in good faith estimate, on a reasonable basis using the Subject
Companies' then available financial information, the Closing Indebtedness, the
Closing Date Book Cash Balances and the difference between the Closing Working
Capital and the Target Working Capital Amount, and will deliver the same to
Silgan, setting out in writing reasonable details of such calculation.
Simultaneously with the delivery of the foregoing to Silgan, the Selling Parties
will deliver to Silgan a statement setting forth the estimated Purchase Price
(which shall be based on the estimated Closing Indebtedness, the estimated
Closing Date Book Cash Balances and the estimated difference between the Closing
Working Capital and the Target Working Capital Amount and any adjustments to be
made pursuant to Section 2.4(g)) (the "Estimated Purchase Price"). As provided
in Section 3.3(a) and subject to the terms of Section 3.4(b), at Closing, Silgan
shall pay, or cause the Purchasers to pay the Estimated Purchase Price, less the
aggregate amount of the Holdback Amounts for each Specified Interest not being
transferred at the Closing Date pursuant to Section 3.4(a), less the estimated
Closing Date Book Cash Balances attributable to each such Specified Interest,
plus or less, as applicable, the estimated Closing Indebtedness attributable to
such Specified Interests and plus or less, as applicable, any adjustment to the
extent based upon the difference between the applicable Specified Interest
Target Working Capital Amount and the estimated Closing Working Capital
attributable to each such Specified Interest (the Estimated Purchase Price, as
so adjusted, being referred to as the "Closing Estimated Purchase Price").
(g) To the extent applicable, the Purchase Price shall be reduced by an amount
equal to six (6) times the difference between the average annual rent payable
under the New German Lease for the ten (10) year term and the aggregate rent
paid under the Current German Lease for the fiscal year ended June 30, 2006.
Rent shall be determined on the same economic basis under both the Current
German Lease and the New German Lease.
Section 2.5 Post Closing Adjustment.
-----------------------
(a) Following the Closing, the Selling Parties shall prepare and deliver to
Silgan a statement setting forth the Closing Indebtedness, the Closing Date Book
Cash Balances and the Closing Working Capital, in each case separately
identifying the amounts attributable to each of the Subject Companies (such
statement, in its final and binding form, the "Closing Statement"). Silgan shall
provide the Selling Parties and their representatives and accountants full
access upon reasonable advance request to the books and records of the Business,
including working papers of its accountants, and to any employees, to the extent
necessary for the Selling Parties to prepare the Closing Statement, such access
to continue until the agreement or determination of the final and binding
Closing Statement. The calculations of the Closing Indebtedness, the Closing
Date Book Cash Balances and the Closing Working Capital shall be prepared as
provided in this Section 2.5.
(b) For the purpose of preparing the Closing Statement, the Selling Parties
shall cause the Subject Companies to conduct a physical inventory as of an
agreed upon date (or dates) on or prior to Closing of the Subject Companies'
Inventory which shall be valued in accordance with the Amcor Financial
Procedures and Controls. Silgan and its representatives shall be entitled to
25
observe such physical inventory and shall have full access to the relevant books
and records of the Selling Parties upon reasonable advance request and to
request copies of supporting documents for the purpose of verifying the amounts
set forth therein. As soon as practical following the Closing Date and in any
event within ninety (90) days thereof, the Selling Parties shall prepare and
deliver to Silgan their proposed Closing Statement. For purposes of preparing
the Closing Statement and determination of the Final Purchase Price (as defined
in clause (f) below), the Parties hereby agree that (i) the Selling Parties
shall translate all amounts denominated in local currencies into Euros using the
Exchange Rate as of the Closing Date, and (ii) cash received by the Subject
Companies on the Closing Date shall be for the account of the Purchasers.
(c) Silgan shall, within sixty (60) days after the delivery by the Selling
Parties of the proposed Closing Statement, complete its review of the proposed
Closing Statement. The Selling Parties shall provide Silgan, its Affiliates and
their respective representatives and accountants with reasonable access to the
books and records, including working papers, used by the Selling Parties and
their accountants to prepare the proposed Closing Statement, such access to
continue until the agreement or determination of the final and binding Closing
Statement. The proposed Closing Statement shall be binding and conclusive upon,
and deemed accepted by, Silgan, unless Silgan shall notify the Selling Parties
in writing within sixty (60) days after delivery of the Closing Statement of any
good faith objection thereto (a "Silgan's Objection"). Silgan may not deliver
more than one Silgan's Objection and may not amend its Silgan's Objection once
it has been delivered to the Selling Parties other than to delete objections. A
Silgan's Objection shall set forth a description in reasonable detail of the
basis of the Silgan's Objection and the adjustments to the Closing Indebtedness,
the Closing Date Book Cash Balances and the Closing Working Capital reflected on
the proposed Closing Statement that Silgan believes should be made. Any items
not disputed in a Silgan's Objection shall be deemed to have been accepted by
Silgan. The Parties agree that they shall not object to or otherwise challenge
the Target Working Capital Amount.
(d) If the Selling Parties and Silgan are unable to resolve in good faith all of
their disputes with respect to the proposed Closing Statement within thirty (30)
days following the Selling Parties' receipt of a Silgan's Objection, they shall
refer their remaining differences for decision to Deloitte & Touche LLP;
provided that the individuals reviewing such Silgan's Objection shall not have
worked on any matters for Amcor Australia or Silgan, provided, however, that if
Deloitte & Touche LLP refuses to serve, is unable to serve or is not independent
of the Parties, the Selling Parties shall select another internationally
recognized firm of independent public accountants that is independent of both
the Selling Parties and Silgan (Deloitte & Touche LLP or such other accountants
being referred to as the "CPA Firm"). If the Parties do not resolve their
disputes within the first fifteen (15) days of such thirty (30) day period, the
Chief Executive Officers of Amcor Australia and Silgan (or the respective
members of senior management designated by each of them) shall attempt in good
faith to resolve any such dispute within the final fifteen (15) days of such
thirty (30) day period. The CPA Firm shall resolve any such disagreements (based
solely on its review of the written presentations of Silgan and the Selling
Parties), and its decision shall be final and binding on the Parties upon
delivery of the written opinion set forth in sub-clause (iii) below. The
procedure and schedule under which any dispute shall be submitted to the CPA
Firm shall be as follows:
26
(i) Within fifteen (15) days after the end of the thirty (30) day period
referred to above, each of Silgan and the Selling Parties shall submit any
unresolved elements of the Closing Statement to the CPA Firm in writing (with a
copy to each other), supported by any documents and/or affidavits upon which it
relies.
(ii) The CPA Firm shall deliver its written opinion within twenty (20) days
following its receipt of the information provided for in sub-clause (i) above,
or such longer period of time as the CPA Firm determines is necessary not to
exceed thirty (30) days. The scope of the disputes to be resolved by the CPA
Firm is limited to the unresolved portion of the Silgan's Objection. Silgan and
the Selling Parties shall make readily available to the CPA Firm all relevant
books and records and any working papers (including those of the Parties'
respective accountants) relating to the proposed Closing Statement and all other
items reasonably requested by the CPA Firm, it being understood that the CPA
Firm shall have the right to request additional submissions from the Parties.
(iii) Any expenses relating to the engagement of the CPA Firm shall be
allocated between Silgan, on the one hand, and the Selling Parties, jointly and
severally, on the other hand, so that Silgan's share of such costs shall be in
the same proportion that (x) the aggregate amount of the disputed items
submitted by Silgan to the CPA Firm that are unsuccessfully disputed bears to
(y) the total amount of all disputed items submitted by Silgan to the CPA Firm.
The Selling Parties, jointly and severally, and Silgan shall each bear the fees
of their respective counsel, auditors and other representatives incurred in
connection with the determination and review of the proposed Closing Statement.
(e) The proposed Closing Statement shall become final and binding on the Parties
upon the earliest of (i) if no Silgan's Objection has been given with respect to
the proposed Closing Statement, the expiration of the period within which Silgan
must make its objection pursuant to Section 2.5(c); (ii) the date of agreement
in writing between the Selling Parties and Silgan that the proposed Closing
Statement, together with any modifications thereto agreed in writing by the
Selling Parties and Silgan, shall be final and binding; and (iii) the date on
which the CPA Firm shall issue and deliver to Silgan and Amcor Australia its
written determination with respect to any dispute relating to the proposed
Closing Statement.
(f) Promptly after the Closing Statement and the determination of the Closing
Indebtedness, the Closing Date Book Cash Balances and the Closing Working
Capital become final and binding under clause (e) above, the Purchase Price
shall, to the extent required, be recalculated by giving effect to such
components of the Purchase Price as are set forth in the Closing Statement (as
recalculated, the "Final Purchase Price"). Subject to any adjustments made
pursuant to Section 2.5(h), if the Estimated Purchase Price is greater than the
Final Purchase Price, the Selling Parties, jointly and severally, shall, and if
the Final Purchase Price is greater than the Estimated Purchase Price, Silgan
shall, or shall cause the Purchasers to, within five (5) Business Days after the
Closing Statement becomes final and binding on the Parties, make payment by wire
transfer to an account specified by Silgan or the Selling Parties, as the case
may be, in immediately available funds of the amount of such difference,
together with interest thereon from the Closing Date to the date of payment at
the Closing Date Interest Rate, which interest shall be calculated on the basis
of a 360-day year and the actual number of days elapsed. Notwithstanding
anything herein to the contrary, any amounts that are owed by one Party to the
27
other pending final resolution of the Final Purchase Price that are not in
dispute between the Selling Parties and Purchaser in the Selling Parties'
proposed Closing Statement shall promptly be paid (plus any interest calculated
in accordance with this clause (f)) by the relevant Party no later than five (5)
Business Days following delivery by the Selling Parties of the proposed Closing
Statement and the disputed portion of the Final Purchase Price shall be paid as
provided above.
(g) Notwithstanding anything herein to the contrary, the Silgan Indemnitees
shall not be entitled to make any claim for indemnification pursuant to this
Agreement if such claim was raised by Silgan in the Silgan's Objection for the
purpose of adjusting the Estimated Purchase Price in determining the Final
Purchase Price.
(h) In the event that pursuant to Section 3.4, any of the Specified Interests
are not transferred to the applicable Purchaser prior to the date the Closing
Statement becomes binding and final, for the purpose of determining the Final
Purchase Price, the Target Working Capital Amount shall be reduced by the
applicable Specified Interest Target Working Capital Amount, each of the Closing
Date Book Cash Balances and the Closing Date Working Capital shall be reduced by
the respective amounts attributable to such Specified Interests and the Closing
Indebtedness shall be increased or decreased, as applicable, by the respective
amounts attributable to such Specified Interest, as set forth in the Closing
Statement and the Selling Parties or Silgan and the Purchasers, as applicable,
shall pay any amounts due under Section 2.5(f) only for the Purchased Equity and
Purchased Assets transferred to the Purchasers prior to the Closing Statement
becoming final and binding. The applicable Selling Party or the applicable
Purchaser shall pay the portion of the adjustment to the Purchase Price
calculated in accordance with Section 2.5(f) and this Section 2.5(h)
attributable to any Specified Interest not transferred to the applicable
Purchaser prior to the date the Closing Statement becomes binding and final (the
"Specified Interest Adjustment Amount") only at such time, if any, as such
Specified Interest is sold pursuant to Section 3.4(b). If such Specified
Interest is not sold to the applicable Purchaser, the Specified Interest
Adjustment Amount shall not be paid by either the applicable Purchaser or
Selling Party.
Section 2.6 Allocation of Purchase Price.
----------------------------
An allocation of the Purchase Price shall be mutually agreed to in good faith by
the Parties prior to the Closing (the "Purchase Price Allocation"); provided
that the Parties have agreed that (euro)30.0 million of the Purchase Price shall
be allocated to the Purchased Assets of Amcor U.S. and Amcor Australia and the
Non-Compete Agreement, in the aggregate and (euro)33.0 million of the Purchase
Price shall be allocated to the purchase of Newco Italy. The Purchase Price
Allocation shall be prepared in a manner consistent with all applicable Laws.
The Parties agree that any adjustment to the Purchase Price made pursuant to
Section 2.5(f) or Section 3.4 shall be allocated (i) to the extent possible, to
the specific Purchased Equity, Purchased Asset or Assumed Liability with respect
to which the adjustment was made, and (ii) otherwise on a pro-rata basis among
all of the Purchased Equity, the Purchased Assets and Assumed Liabilities, and
shall result in a revised Purchase Price Allocation, all such adjustments to be
applied consistently by the Selling Parties and Silgan. The Parties agree to
procure that all Tax Returns will be filed consistently with the Purchase Price
Allocation, subject to adjustment (if any) as aforesaid, and to not take any
position inconsistent therewith unless required to do so by applicable Law.
Silgan and the
28
Selling Parties shall promptly inform one another in writing of any challenge by
any taxing authority to any allocation made pursuant to this Section 2.6 and
agree to consult with and keep one another informed with respect to the status
of, and any material discussion, proposal or submission with respect to, any
such challenge.
ARTICLE III
THE CLOSING
Section 3.1 Time and Place of Closing.
-------------------------
The consummation of the Transactions (the "Closing") shall be held at the
offices of Silgan's counsel or at such other location or locations as reasonably
agreed to by the Selling Parties and Silgan, and shall occur at 10:00 a.m.,
local time in New York (or such other time as mutually agreed to by the
Parties). The Closing shall occur on such date as promptly as practicable
following the satisfaction and/or waiver of all conditions to Closing set forth
in Article VII (other than conditions to be satisfied on the Closing Date) as
reasonably agreed to by the Selling Parties and Silgan, but except as provided
in the proviso to this sentence in no event later than (10) Business Days after
such conditions are satisfied and/or waived; provided that in no event shall the
Closing Date be before ninety (90) days from the date hereof, unless otherwise
mutually agreed to by the Parties (the "Closing Date"). Subject to Section 3.4
and Section 3.5, the Closing as it relates to each of the Subject Companies
shall be effective as of 12:01 a.m., local time for such Subject Company, on the
Closing Date (the "Closing Time").
Section 3.2 Selling Parties' Deliveries.
---------------------------
On or before Closing, the Selling Parties shall deliver to Silgan (or as Silgan
directs) the following:
(a) Purchased Equity Certificates. Certificate(s) representing the Purchased
Equity (if such equity is represented by a certificate), such certificate(s) to
be duly and validly endorsed in favor of the respective Purchasers or
accompanied by a separate stock power or transfer or assignment (or comparable
document) duly and validly executed by the registered holder of the Purchased
Equity, sufficient to vest in the Purchasers good title to the Purchased Equity,
or other evidence as is customary under the applicable Law governing the
corporate aspects of such Acquired Company such that good title to the Purchased
Equity of such Acquired Company has been transferred to the Purchasers;
(b) Local Agreements. Duly executed Local Agreements by the applicable Selling
Parties as set forth in Section 3.5 hereof;
(c) Consents. The Consents and notices required prior to Closing described on
Schedule 3.2(c);
(d) Corporate Approval. Copies, certified by the respective Secretary or
Assistant Secretary of each Selling Party, of the approval by the board of
directors, executive board and supervisory board, as applicable (or where no
such bodies exist in a particular jurisdiction, the managing director) of such
Selling Party authorizing the execution, delivery and performance of this
Agreement, the Ancillary Agreements and all other agreements, documents and
instruments relating hereto to which such Selling Party is a party and the
consummation of the Transactions;
29
(e) Deeds. Special warranty deeds (or the local equivalent) (the "Deeds")
sufficient to transfer and convey good fee or other comparable title to each of
the Asset Sellers' Owned Real Property to the Purchasers;
(f) Acquired Company Director Resignations. Resignations of such directors and
officers of the Acquired Companies as may be requested in writing by Silgan;
(g) Italian Tax Certificate. The tax certificate attesting the outstanding tax
liabilities of the going concern to be contributed to Newco Italy as provided
under Article 14 of Legislative Decree 472/97 from the relevant tax authorities
in Italy;
(h) Data Room Disk. One copy of the Data Room Disk (it being acknowledged that
the Data Room Disk is not the only information made available to Silgan);
(i) Non-Compete Agreement. The Non-Compete Agreement executed by Amcor
Australia;
(j) Instruments of Transfer. Instruments of assignment and such other
assignments, bills of sale, certificates of title and other instruments of
transfer (collectively, the "Bills of Sale") as are reasonably necessary to
convey fully and effectively to the Purchasers the Purchased Assets in
accordance with the terms hereof;
(k) Opinions. Opinions of legal counsel in each jurisdiction of organization of
each Selling Shareholder and Subject Company in the form of Schedule 3.2(k)
hereto, subject to such assumptions and qualifications as are customary and
usual to the practice in each such jurisdiction for a transaction of this type;
(l) Transition Services Agreement. The Transition Services Agreement as
described in Section 6.16 hereof (the "Transition Services Agreement");
(m) Officer's Certificates. Duly executed officer's certificates, dated as of
the Closing Date, with respect to the matters set forth in Section 7.2(a) and
Section 7.2(b) hereof;
(n) Good Standing Certificates. Certificates of good standing (or comparable
documents, if any, as applicable) issued from jurisdictions in which the Subject
Companies are formed or organized, dated not more than seven (7) days prior to
the Closing Date or such longer period reasonably satisfactory to Silgan as may
reasonably be required by the Selling Parties; and
(o) Other Assurances. Such certificates, assurances and documents as Silgan may
reasonably request prior to the Closing Date in order to effectuate the Closing.
Section 3.3 Silgan's Deliveries.
-------------------
At Closing, Silgan shall deliver, or shall cause the Purchasers to deliver, to
the Selling Parties (or as the Selling Parties direct) the following:
(a) Payment of Closing Estimated Purchase Price. The Closing Estimated Purchase
Price shall be paid by wire transfer in immediately available funds to the
Selling Parties (to such bank account(s) as is or are designated in writing by
the Selling Parties at least two (2) Business Days
30
prior to the Closing Date) (it being understood that with respect to the
purchase of Amcor Deutschland and Amcor Sweden, only SWC Holdings Deutschland
GmbH i.G. shall make such payment or, if Silgan makes the payment, Silgan may
only do so on behalf of and for the account of SWC Holdings Deutschland GmbH
i.G.);
(b) Local Agreements. Duly executed Local Agreements by the applicable Purchaser
as set forth in Section 3.5 hereof;
(c) Consents. The Consents and notices required prior to Closing described on
Schedule 5.3;
(d) Corporate Approval. Copies, certified by the respective Secretary or an
Assistant Secretary of Silgan, of the approval by the board of directors of
Silgan authorizing the execution, delivery and performance of this Agreement,
the Ancillary Agreements and all other agreements, documents or instruments
relating hereto to which Silgan is a party and the consummation of the
Transactions;
(e) Assumptions. Instruments of assumption in form reasonably satisfactory to
the Asset Sellers (the "Assumption Agreements") pursuant to which the applicable
Purchaser assumes the Assumed Liabilities;
(f) [Intentionally omitted];
(g) Officer's Certificates. Duly executed officer's certificates dated as of the
Closing Date, with respect to the matters set forth in Section 7.3(a) and
Section 7.3(b) hereof; and
(h) Other Assurances. Such certificates, assurances and documents as the Selling
Parties may reasonably request prior to the Closing Date in order to effectuate
the Closing.
Section 3.4 Failure to Obtain Specified Approvals.
-------------------------------------
(a) Notwithstanding anything to the contrary in this Agreement, in the event
that all of the conditions precedent to the Parties' obligations to effect the
Closing pursuant to Article VII hereof have been satisfied but any of the
Specified Approvals have not been obtained, then the Parties will be obligated
to effect the Closing in accordance with Sections 3.1, 3.2 and the other terms
of this Agreement with respect to the sale and purchase of all of the Purchased
Equity and Purchased Assets except the Purchased Equity of the Acquired Company
or Acquired Companies with respect to which the Specified Approval has not been
so obtained (each, a "Specified Interest"). In such event, the applicable
Selling Party or Selling Parties will not be obligated to sell, and Silgan will
not be obligated to cause the applicable Purchaser or Purchasers to purchase,
any such Specified Interest at the Closing and the terms of this Section 3.4
shall govern; provided that (i) Silgan shall have the right in its sole
discretion to waive the receipt of the Specified Approval in respect of Amcor
Asia Pacific, Amcor South East Asia, Amcor Investments and Amcor Properties,
collectively, prior to Closing or during the Specified Time Period and, assuming
all other conditions precedent to the Parties' obligations to effect the Closing
pursuant to Article VII hereof have been satisfied, the applicable Selling Party
shall then be obligated to sell such Specified Interest to the applicable
Purchaser if Silgan so elects and (ii) Amcor Australia shall have the right in
its sole discretion to waive the receipt of the Specified Approval in respect of
Amcor Venezuela relating to the distribution of the Book Cash Balances
31
of such Specified Interest prior to Closing or during the Specified Time Period
and, assuming all other conditions precedent to the Parties' obligations to
effect the Closing pursuant to Article VII hereof have been satisfied, the
applicable Purchaser shall then be obligated to purchase such Specified Interest
if Amcor Australia so elects. The applicable Selling Party shall continue to own
such Specified Interest for all purposes, and the Parties shall enter into a
Specified Interest Management Agreement on terms mutually satisfactory to the
Parties, acting reasonably, which shall include a management fee to be paid to
Silgan or the respective Purchaser in an amount equal to the cash of such
Specified Interest, after the Closing in excess of the Closing Date Book Cash
Balance of such Specified Interest (the "Management Fee"), provided that in
respect of Amcor Asia Pacific, Amcor South East Asia, Amcor Investments and
Amcor Properties, Silgan is not obligated to enter into a Specified Interest
Management Agreement at the Closing if in Silgan's reasonable discretion it does
not believe the amendment to the Cerebos Agreement described in the definition
of Specified Approval shall be obtained. Such Specified Interest Management
Agreement shall also provide an indemnity (except for gross negligence, willful
misconduct and fraud) for the benefit of Silgan and the respective Purchaser.
Pursuant to such Specified Interest Management Agreement, Silgan or the
respective Purchaser shall operate the applicable Acquired Company in the
ordinary course consistent with past practice (including making capital
expenditures in the ordinary course of business and not incurring new debt) for
the benefit of the respective Acquired Company and Amcor Australia until such
Specified Approval is obtained. During such time as Silgan or the respective
Purchaser is operating the applicable Acquired Company pursuant to such
Specified Interest Management Agreement, in the event the cash needs of such
Acquired Company exceed its operating cash flows plus the Closing Date Book Cash
Balances of such Acquired Company, first Silgan shall reimburse such Acquired
Company any Management Fee it has been paid by such Acquired Company, if any, to
the extent of such cash shortfall, and, if such Acquired Company still has a
cash shortfall, then the applicable Selling Party shall be obligated to fund
such cash shortfall. To the extent the applicable Selling Party funds any cash
shortfall as required herein, such Selling Party shall be reimbursed to the
extent of such funding prior to Silgan receiving any Management Fee for such
Specified Interest. All capital expenditures not in the ordinary course of
business of any Acquired Company being operated by Silgan shall require the
approval of the applicable Selling Party, such approval not to be unreasonably
withheld, conditioned or delayed. In the event that the purchase and sale of
such Acquired Company closes in accordance with this Section 3.4, Silgan shall
repay to the applicable Selling Party any cash shortfalls such Selling Party was
required to fund for such Acquired Company in accordance with this Section
3.4(a) that were not previously reimbursed. If the Parties are unable to agree
on the terms of such management agreement, or if any such Specified Interest
Management Agreement is not permitted by applicable Law, or if Silgan or the
applicable Purchaser with respect to Amcor Asia Pacific, Amcor South East Asia,
Amcor Investments and Amcor Properties shall have elected not to enter into such
Specified Interest Management Agreement as provided above, the applicable
Selling Party shall continue to operate the applicable Acquired Company, under
its own direction and control, but in compliance with the covenants set forth in
this Agreement, at its sole expense and for its sole benefit, until such
Specified Approval is obtained, in which event Silgan shall make available to
the applicable Selling Party all Company Intellectual Property provided to such
Acquired Company as of the Closing Date, for a period until the end of the
Specified Time Period, as it may be extended, on a royalty-free, exclusive
basis, as may reasonably be necessary in order to permit such Selling Party to
operate the business of the applicable Acquired Company
32
as it was operated prior to Closing. The Purchasers and the other Acquired
Companies shall also provide during the Specified Time Period to the applicable
Acquired Company such services reasonably required by such Acquired Company
substantially as provided by the Business as of the Closing Date, for prices
charged to such party as reflected in the Financial Statements as of June 30,
2005. If the Selling Parties are operating the applicable Acquired Company
pursuant to the foregoing, the Selling Parties shall not transfer or distribute
any cash or cash equivalents out of such Acquired Company prior to the end of
the applicable Specified Time Period.
(b) If any Specified Approval required for the sale or purchase of any Specified
Interest is obtained within the applicable Specified Time Period, the Parties
shall then be obligated to close the sale and purchase of such Specified
Interest as soon as reasonably practicable following the receipt of such
Specified Approval under the terms and pursuant to the provisions of this
Agreement, in which case all representations, warranties, covenants, closing
conditions and indemnities shall continue to apply to such Specified Interests.
Upon such closing specified above, the applicable Purchaser shall pay the
Holdback Amount attributable to such Specified Interest and the applicable
Purchaser or the applicable Selling Party, as the case may be, shall pay the
Specified Interest Adjustment Amount, if any, calculated as of the Closing Date
as set forth in Section 2.5(h). If within the applicable Specified Time Period
any Specified Approval required for the sale or purchase of any Specified
Interest (except Sprint Brazil) is not obtained, the Parties shall no longer be
obligated to close the sale and purchase of such Specified Interest in
accordance herewith other than pursuant to the remainder of this paragraph or
other than pursuant to Section 3.4(c). If in such case the applicable Selling
Party used its commercially reasonable efforts in good faith to obtain any
Specified Approval required for the sale or purchase of any Specified Interest
(except Sprint Brazil) within the applicable Specified Time Period, the
applicable Specified Interest Management Agreement shall remain in effect for an
additional three (3) months, or the Specified Time Period shall extend for an
additional three (3) months if there is no Specified Interest Management
Agreement, in each case if the Parties mutually agree, during which time, if
such Specified Approval is obtained the Parties shall be obligated to close the
purchase and sale of such Specified Interest in accordance with Section 3.4(a).
If in such case the applicable Selling Party shall not have used its
commercially reasonable efforts in good faith to obtain any Specified Approval
required for the sale or purchase of any Specified Interest (except Sprint
Brazil) within the applicable Specified Time Period and such Specified Approval
is not obtained, Silgan shall have the right by giving notice to Amcor Australia
not less than thirty (30) days prior to the end of the applicable Specified Time
Period to continue to operate the applicable Specified Interest (except Sprint
Brazil) under the terms of the applicable Specified Interest Management
Agreement for an additional three (3) months or to extend the applicable
Specified Time Period in the event there is no Specified Interest Management
Agreement for an additional three (3) months. If such Specified Approval is not
obtained by the end of such additional three (3) month period, the applicable
Specified Interest Management Agreement shall terminate. If such Specified
Approval is obtained during such three (3) month period, then the Parties shall
be obligated to close the purchase and sale of such Specified Interest (except
Sprint Brazil) in accordance with Section 3.4(a). If within the applicable
Specified Time Period the Specified Approval required for the sale or purchase
of Sprint Brazil is not obtained, at Gold's option by giving notice to Amcor
Australia not less than thirty (30) days prior to the end of the applicable
Specified Time Period, such Specified Time Period shall be extended for an
additional six (6) months. If the Specified Approval for the purchase and sale
of Sprint Brazil is not obtained within such extended Specified Time Period,
33
the Parties shall no longer be obligated to close the sale and purchase of
Sprint Brazil in accordance herewith other than pursuant to Section 3.4(c). If
within the applicable Specified Time Period any Specified Approval required for
the sale or purchase of any Specified Interest is determined mutually by the
Parties acting reasonably to not be obtainable, the applicable Specified
Interest Management Agreement shall terminate on the date chosen by Amcor
Australia not later than thirty (30) days after such determination unless the
Parties mutually agree to continue such agreement. If a Specified Interest
Management Agreement terminates, the applicable Selling Party shall continue to
own and may, in its sole discretion, operate the applicable Acquired Company
under its own direction and control, at its sole expense and for its sole
benefit, in which event the applicable Purchaser shall make available to the
applicable Acquired Company all Company Intellectual Property provided to such
Acquired Company as of the Closing Date, for a royalty fee of 3% of net sales of
such Acquired Company (provided that, at Silgan's option, Silgan may no longer
maintain such intellectual property in which case the applicable Selling Party
shall no longer be obligated to pay any royalty fee), on a perpetual basis, and
(i) exclusive to manufacture and sell in such country where the applicable
Specified Interest is manufacturing at such time and (ii) non-exclusive to sell
products in such other countries where such Specified Interest is selling
products at such time, as may reasonably be necessary in order to permit such
Acquired Company to operate its business as it was operated as of the Closing
Date; provided that in addition to the foregoing Silgan and its Affiliates shall
not, directly or indirectly, compete for or accept (i) the business of the
customers of Amcor Asia Pacific and Amcor South East Asia for the Bandguard
product as such business exists as of the Closing in countries where Amcor Asia
Pacific and Amcor South East Asia were selling such Bandguard products to those
customers and (ii) if and only if the applicable Purchaser managed for any
period of time the business of Amcor Asia Pacific and Amcor South East Asia
under a Specified Interest Management Agreement, the business of the customers
of Amcor Asia Pacific and Amcor South East Asia for metal vacuum closures as
such business exists as of the Closing in countries where Amcor Asia Pacific and
Amcor South East Asia were selling such metal vacuum closures to those
customers.. The Purchasers and the other Acquired Companies shall also provide
the applicable Acquired Company such services reasonably required by such
Acquired Company substantially as provided by the Purchasers and Acquired
Companies prior to the Closing Date, for a period of six (6) months from the
Closing Date (it being agreed that the Parties shall negotiate in good faith an
extension of such period for any service the Acquired Company (with Amcor
Australia) acting reasonably has not been able to provide itself or procure from
a third party) and for prices charged to such party as reflected in the
Financial Statements as of June 30, 2005. Amcor Australia or any of its
Affiliates may exercise the rights of the Acquired Companies hereunder if the
Specified Interest Management Agreement has terminated.
(c) If any Specified Interest (other than Amcor South East Asia, Amcor Asia
Pacific, Amcor Investments and Amcor Properties, collectively) is not sold to
the applicable Purchaser at the Closing or in accordance with the foregoing
provisions of this Section 3.4, then Amcor Australia and its Affiliates shall be
prohibited from selling (whether by sale of stock, all or substantially all of
the assets or otherwise) such Specified Interest for five (5) years after the
termination of the applicable Specified Interest Management Agreement (or if
there is no such Specified Interest Management Agreement, after the end of the
applicable Specified Time Period) except in accordance with this Section
34
3.4(c). At any time after the Specified Time Period if the applicable Selling
Party or any Affiliate of Amcor Australia proposes to sell such Specified
Interest, it shall first offer such Specified Interest to Silgan pursuant to the
terms of this Section 3.4(c). The applicable Selling Party shall provide Silgan
with a written notice specifying the proposed purchase price, terms of payment
and all other material terms and conditions of the offer (the "Offeree Notice").
Silgan shall have the right, for a period of sixty (60) days (or thirty (30)
days if Silgan is managing the business of such Specified Interest pursuant to
the applicable Specified Interest Management Agreement) after such Offeree
Notice is given (the "Refusal Period"), to accept the offer set forth in such
Offeree Notice by giving written notice to the applicable Selling Party
containing its acceptance. During the Refusal Period, Silgan shall have the
right to conduct due diligence in respect of such Specified Interest as it shall
reasonably require. If, within the Refusal Period, Silgan gives such a notice
containing its acceptance, then the applicable Selling Party shall sell such
Specified Interest in whole to Silgan or its Affiliate on the terms and
conditions set forth in the Offeree Notice. If within the Refusal Period, either
(i) Silgan does not give the applicable Selling Party such a notice containing
its acceptance or (ii) Silgan gives notice that it rejects the terms outlined in
the Offeree Notice, then the applicable Selling Party shall have one hundred
eighty (180) days from the expiration of the Refusal Period (the "Refusal
Transfer Period") to consummate the sale of such Specified Interest in whole to
a third party only at a purchase price not lower than the purchase price offered
to Silgan in the Offeree Notice and on terms and conditions not materially less
favorable in the aggregate to the applicable Selling Party than the terms and
conditions offered to Silgan in the Offeree Notice. If the applicable Selling
Party does not consummate the sale of such Specified Interest to a third party
within the Refusal Transfer Period as provided in the preceding sentence, then
such Specified Interest shall again become subject to all of the restrictions
upon transfer set forth in this Section 3.4(c).
(d) The terms and conditions relating to the management of such Specified
Interest as set forth in this Section 3.4 will be more specifically set forth in
the agreements governing the management of such Specified Interests to be
entered into, if necessary, upon Closing (the "Specified Interest Management
Agreements").
(e) Without any obligation on either Party, if Silgan elects not to purchase
Amcor Asia Pacific, Amcor South East Asia, Amcor Investments and Amcor
Properties on the Closing Date the Parties shall seek to work together to
separate the Philippines metal closures and Philippines Bandguard business and
to sell the Philippines metal closures business to Silgan on terms satisfactory
to the Parties, in their sole discretion.
Section 3.5 Local Closings.
--------------
To the extent that any closing of the sale and purchase of (i) the Purchased
Equity with respect to any Acquired Company or (ii) any of the Purchased Assets
is required to occur within the jurisdiction of the respective Selling Party's
or Acquired Company's formation (whether by reason of notarial deed or
otherwise) (any such closing, a "Local Closing"), such Local Closing shall,
subject to Section 3.4, take place in escrow not less than one (1) Business Day
and not more than three (3) Business Days before the Closing Date (but not prior
to the satisfaction or waiver of all of the conditions set forth in Article VII
(other than those conditions to be satisfied on the Closing Date)) in such
jurisdiction at the offices of Selling Parties' counsel in such jurisdiction or
such other location as the parties may agree. It is understood and agreed that
the applicable Selling Party may each execute with the applicable Purchaser such
instruments of transfer as are required under applicable Law to effect the
transfer and conveyance of the
35
applicable Purchased Equity and/or the applicable Purchased Assets at any such
Local Closing (the "Local Agreements"). It is further understood and agreed that
the Local Agreements are intended to act only as the operative documents of
transfer, and that such Local Agreements shall not alter, modify or amend in any
way any of the terms or provisions of this Agreement, including the terms
relating to representations and warranties or indemnification, save as may be
required by applicable Law in the relevant jurisdiction. To the extent any
conflict exists between any of the terms of Local Agreements and this Agreement,
the terms of this Agreement shall prevail.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE SELLING PARTIES
Except as disclosed in the attached Schedules prepared by the Selling Parties
and delivered to Silgan simultaneously with the execution hereof, the Selling
Parties, jointly and severally, represent and warrant to Silgan and the
Purchasers as hereinafter set forth. For purposes of the representations and
warranties of the Selling Parties contained herein, disclosure in any of the
Schedules attached hereto of any facts or circumstances shall be deemed to be
disclosure of such facts or circumstances with respect to all representations
and warranties by the Selling Parties calling for disclosure of such
information, whether or not such disclosure is specifically associated with or
purports to respond to one or more or all of such representations and warranties
if it is reasonably apparent on the face of the Schedule that such disclosure
relates to the subject matter thereof. The inclusion of any information in any
Schedule pursuant to this Agreement shall not be deemed to be an admission or
evidence of the materiality of such item, nor shall it establish a standard of
materiality for any purpose whatsoever. For purposes of the representations and
warranties of the Selling Parties contained herein, the Parties agree that for
matters referencing "(euro)" or "Euros", the Exchange Rate for the local
currency of a Subject Company as of the date hereof shall be used, except as
herein otherwise contemplated or provided. Notwithstanding any disclosure on
Schedule 4.14 and 4.20 (as it relates to employee claims), the Silgan
Indemnitees have a claim for indemnification under Section 10.2(c) as it relates
to the Asset Sellers and Section 10.2(g) as it relates to the Acquired Companies
for all items disclosed on such Schedules, to the extent in excess of the amount
for "Litigation" set forth on Schedule 1.1(B). Notwithstanding any disclosure on
Schedule 4.28, either any item disclosed on such Schedule shall be governed by
Section 6.23 or the Silgan Indemnitees shall have a claim for indemnification
under Section 10.2(e), as applicable, for all items disclosed on such Schedule.
Section 4.1 Organization and Qualification of the Selling Parties and the
--------------------------------------------------------------
Acquired Companies.
------------------
Schedule 4.1(A) sets forth the name and jurisdiction of formation for each
Subject Company and Selling Party. Each Subject Company and Selling Party (i) is
validly existing and in good standing under the Laws of its jurisdiction of
formation; (ii) has all requisite power, authority, legal capacity to own, lease
and operate its properties and to carry on its business as now being conducted;
and (iii) to the extent applicable, is duly qualified or licensed to do business
in each jurisdiction in which the character of the properties owned, leased or
operated by it or the nature of its activities makes such qualification or
licensing necessary, except where the failure to be so qualified or licensed,
either singularly or in the aggregate, would not have, or be reasonably
36
expected to have, a Material Adverse Effect. Except as set forth in Schedule
4.1(A), (i) the Organizational Document and Operating Document for each Acquired
Company have been furnished to Silgan and are complete and correct, (ii) the
minute books (containing the records of meetings of the equity holders and the
board of directors, executive board and supervisory board or other similar body,
as applicable) of each Acquired Company include the minutes of all meetings held
by, and all consents obtained from, the equity holders or the board of
directors, executive board and supervisory board or other similar body, as
applicable, since July 1, 2002 where decisions material to such Acquired Company
were made, (iii) the stock certificate books and the stock record books (or
other registry of Capital Stock) of each Acquired Company are complete and
correct for all periods since July 1, 2002, and (iv) none of the Acquired
Companies are in default under or in violation of any provision of its
Organizational Document or its Operating Document. Schedule 4.1(B) sets forth a
list of all of the officers and directors of each Acquired Company.
Section 4.2 Authorization.
-------------
Each Selling Party has the legal right and requisite power and authority
(including pursuant to its Operating Documents or Organizational Documents) to
execute and deliver and perform its obligations under this Agreement and the
Ancillary Agreements to which it is a party, and to consummate the Transactions.
The execution, delivery and performance by each Selling Party of this Agreement
and the Ancillary Agreements to which it is a party and the consummation of the
Transactions have been duly authorized by the board of directors, executive
board and supervisory board, as applicable (or where no such bodies exist in a
particular jurisdiction, the managing director) of such Selling Party, and by
the registered holders of the Capital Stock of such Selling Party (if required
by applicable Law), and no other action on the part of any Selling Party is
necessary to authorize the execution and delivery by such Selling Party of this
Agreement or the Ancillary Agreements to which it is a party or the consummation
of the Transactions.
Section 4.3 Execution; Validity of Agreement.
--------------------------------
Each Selling Party has duly executed and delivered this Agreement and shall
execute and deliver each Ancillary Agreement to which it is a party. This
Agreement is, and each of the Ancillary Agreements to which it is a party when
executed and delivered will be, a valid and binding obligation of each Selling
Party, enforceable against such Selling Party in accordance with their terms
except (i) as limited by applicable bankruptcy, insolvency, reorganization,
moratorium, fraudulent conveyance and other similar Laws of general application
affecting enforcement of creditors' rights generally, and (ii) the availability
of the remedy of specific performance or injunctive or other forms of equitable
relief may be subject to equitable defenses and would be subject to the
discretion of the court before which any proceeding therefor may be brought.
Section 4.4 Consents and Approvals; No Violations.
-------------------------------------
Except as set forth in Schedule 4.4 and for the filings, Consents and notices as
may be required under, and other applicable requirements of, the Antitrust Laws,
none of the execution, delivery or performance by any Selling Party of this
Agreement or any Ancillary Agreements to which it is a party, the consummation
by any Selling Party of the Transactions or the compliance by any
37
Selling Party with any of the provisions hereof or of any Ancillary Agreements
to which it is a party will (i) conflict with or result in any breach of any
provision of the Operating Documents or Organizational Document of such Selling
Party; (ii) require any filing with or notification prior to Closing to, or the
obtaining of any Consent of, any Person; (iii) result in a violation or breach
of, or constitute (with or without due notice or lapse of time or both) a
default under, any of the terms of any Contract to which such Selling Party is a
party or by which such Selling Party or any of its properties may be bound; or
(iv) violate any Law, order or judgment applicable to such Selling Party or to
any of its properties, excluding from the foregoing clauses (ii), (iii) and (iv)
such violations, breaches or defaults that (A) would not, individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect or (B) would
become applicable as a result of any acts or omissions by Silgan other than its
consummation of the Transactions.
Section 4.5 Capitalization and Title to the Purchased Equity.
------------------------------------------------
(a) Schedule 4.5(a) sets forth the authorized Capital Stock and the issued and
outstanding Capital Stock for each Acquired Company, together with the of record
owner of such issued and outstanding Capital Stock, and as regards such issued
and outstanding Capital Stock in respect of which a Selling Party is the of
record owner, the beneficial owner of such Capital Stock. All of the Purchased
Equity has been duly authorized and validly issued and is fully paid and
non-assessable. Except as set forth on Schedule 4.5(a), there are no existing
options, warrants, calls, pre-emptive rights, rights of first refusal, limits on
transfer or subscriptions relating to the issued or unissued Capital Stock of an
Acquired Company obligating such Acquired Company to issue, transfer or sell any
of its Capital Stock.
(b) Each of the Selling Parties that is a beneficial owner of Capital Stock of
an Acquired Company, as set forth on Schedule 4.5(a), has good and valid title
to such Capital Stock free and clear of all Encumbrances, except for Permitted
Encumbrances.
Section 4.6 Good Title Conveyed in the Purchased Equity.
-------------------------------------------
The delivery of the stock certificates, stock powers, endorsements, assignments
or such other instruments to be executed and/or delivered by the Selling Parties
to the Purchasers with respect to the transfer of the Purchased Equity will,
subject to publication or deposit of notarial instruments as required under
applicable Law, vest in the Purchasers good title to the Purchased Equity, free
and clear of all Encumbrances, except restrictions on transfer imposed by any
applicable securities Laws and Permitted Encumbrances.
Section 4.7 Subsidiaries.
------------
Except as set forth on Schedule 4.7, the Acquired Companies do not own, directly
or indirectly, any Capital Stock in any Person.
Section 4.8 Financial Statements and Indebtedness.
-------------------------------------
(a) Copies of the Financial Statements are set forth in Schedule 4.8(a). Except
as set forth on Schedule 4.8(a), the Financial Statements have been prepared
from the books and records of the Subject Companies, have been prepared in
accordance with IFRS (with the exception of the Individual Statements, which
have been prepared in accordance with the applicable local
38
generally accepted accounting principles consistently applied) applied on a
consistent basis (except as may be stated in the notes thereto) and the Amcor
Financial Procedures and Controls (with the exception of the Individual
Statements which have been prepared in accordance with Amcor's financial
controls), and fairly present in all material respects the consolidated
financial position and the consolidated results of operations and cash flows of
the Subject Companies, as of the times and for the periods referred to therein.
(b) Set forth on Schedule 4.8(b) is a description of the Indebtedness owed by or
to the Acquired Companies, to the extent Indebtedness thereof is included in the
Closing Indebtedness, and the amounts owed by or to such Acquired Companies
under such Indebtedness as of December 31, 2005.
(c) Set forth on Schedule 4.8(c) is a complete and correct list of the types and
amounts of the accruals for the Business included in the Financial Statements
described in clauses (i) and (iv) of the definition of Financial Statements for
June 30, 2005 and December 31, 2005, determined in the same manner as the
accruals for the Financial Statements for June 30, 2005.
Section 4.9 No Undisclosed Liabilities.
--------------------------
(a) Except (i) as and only to the extent set forth on Schedule 4.9(a), (ii) as
and only to the extent set forth on the Financial Statements and (iii) for
liabilities and obligations incurred in the ordinary course of business since
June 30, 2005 consistent with past practice, no Subject Company has any
liabilities or obligations, whether absolute, accrued, contingent or otherwise,
that would, individually or in the aggregate, be material to such Subject
Company, the Purchased Assets or the Business, taken as a whole, and would be
required to be recorded on a balance sheet prepared in accordance with IFRS.
(b) Except as set forth on Schedule 4.9(b), the Subject Companies (A) have
designed and maintain disclosure controls and procedures (as defined in Rules
13a-15(e) and 15d-15(e) under the Exchange Act) to ensure that material
information required to be disclosed by Amcor Australia in the reports that it
files or submits under the Exchange Act is recorded, processed, summarized and
reported within the time periods specified in the U.S. Securities and Exchange
Commission's rules and forms and is accumulated and communicated to the Subject
Companies' management as appropriate to allow timely decisions regarding
required disclosure, and (B) have disclosed, based on the most recent evaluation
of Amcor Australia's internal control over financial reporting (as defined in
Rules 13a-15(f) and 15d-15(f) under the Exchange Act) prior to the date hereof,
to the Subject Companies' auditors any fraud, whether or not material, that
involves management or other employees who have a significant role in the
internal controls over financial reporting of the Subject Companies.
(c) Except as set forth on Schedule 4.9(c), in connection with Amcor Australia's
▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 Section 302 certification review for the year ended
June 30, 2005 (i) there were no significant deficiencies or material weaknesses
that remained unresolved as of June 30, 2005 in the design or operation of
internal controls over financial reporting relating to any of the Subject
Companies and (ii) there has not been any fraud identified or allegation of
fraud, whether or not material, that involves management or other employees who
have a significant role in the Subject Companies' internal controls over
financial reporting since July 1, 2002.
39
Section 4.10 Absence of Certain Changes.
--------------------------
Except as disclosed on Schedule 4.10 and except for the execution and delivery
of this Agreement, since July 1, 2005, (1) there has not been any change in the
business, assets, financial position, operations or results of operations or
prospects of the Business, the Purchased Assets and the Acquired Companies taken
as a whole, other than any such changes that occurred in the ordinary course of
business or that would not reasonably be expected to have a Material Adverse
Effect, (2) the Subject Companies have been spending on capital and capital
maintenance as set forth on Schedule 4.10(2) and (3) the Subject Companies have
conducted the Business only in the ordinary course consistent with past
practice. In addition, except as disclosed on Schedule 4.10, there has not
occurred since July 1, 2005 with respect to any Subject Company (except as
regards subparagraphs (a) and (b) below, which relate only to the Acquired
Companies) or the Business:
(a) any change in its authorized or issued Capital Stock;
(b) any amendment to its Operating Document or Organizational Document;
(c) any increase in the salary, wages, bonus or other compensation of any
director, officer, or employee, other than in the ordinary course of business
consistent with past practice;
(d) any labour strike;
(e) any adoption of or amendment to any Benefit Plan maintained or contributed
to by it, except as required by applicable Laws;
(f) any subjecting of any of its properties, business or assets to any
Encumbrance, other than a Permitted Encumbrance or by operation of Law;
(g) any casualty loss (whether or not covered by insurance) affecting any of its
properties in excess of (euro)100,000;
(h) any change in any accounting policy, including with respect to the payments
of accounts payable and collections of accounts receivable, unless required by
IFRS;
(i) any acquisition, disposition, sale, transfer or lease of any asset used in
connection with the Business (i) out of the ordinary course of business
consistent with past practice or (ii) having a value in excess of (euro)25,000
on an individual basis or (euro)200,000 in the aggregate, except for obsolete
equipment and Inventory sold and capping equipment leased, each in the ordinary
course of business;
(j) any disposition, sale or transfer of any company or business, other than the
sale of the Business as contemplated by this Agreement;
(k) any acquisition of any other Person (other than an Affiliate of a Subject
Company) or any other business, including by merger or consolidation;
40
(l) any commitment for capital expenditures not already paid for in excess of
(euro)100,000 on an individual basis, except to the extent disclosed on Schedule
4.10(2);
(m) any cancellation, waiver, release or other compromise of any material debt
or claim, or any right of significant value, except in the ordinary course of
business consistent with past practice;
(n) any decrease in the amount of any reserves for doubtful Receivables or any
write down or write up of the value of any Inventory or other asset, except in
the ordinary course of business consistent with past practice;
(o) any commencement of any litigation, action or proceeding before any
Governmental Entity relating to it or its property used in connection with the
Business where the amount claimed exceeds (euro)100,000;
(p) any change in any election concerning Taxes or Tax Returns, change in annual
accounting period, adoption or change in any accounting method, filing of any
amended return, entering into any closing agreement with respect to Taxes,
settlement of any Tax claim or assessment, surrender of any right to claim a
refund of Taxes or obtainment of or entrance into any Tax ruling, agreement,
contract, understanding, arrangement or plan;
(q) any net loss of business or erosion of profit margin from any Major Customer
affecting any Subject Company in an amount that is material to the revenues and
profits attributable to such Major Customer (it being understood that this
Section 4.10(q) only applies for the period from July 1, 2005 through the date
of this Agreement for purposes of Section 7.2(a)); or
(r) any entering into of a Contract to do or engage in any of the foregoing.
Section 4.11 Ownership and Condition of Assets; Sufficiency of Assets and
------------------------------------------------------------
Purchased Equity.
----------------
(a) Real Property.
-------------
(i) Set forth on Schedule 4.11(a) is a true, correct and complete list of
all the Owned Real Property owned by the Subject Companies. Except as set forth
on Schedule 4.11(a), each of the Subject Companies has good and fee or other
comparable title to its respective Owned Real Property described on Schedule
4.11(a), free and clear of all Encumbrances, except for Permitted Encumbrances.
Except as set forth on Schedule 4.11(a), (1) there are no leases, licenses or
other agreements respecting use and/or occupancy affecting any Owned Real
Property (or any portion thereof), (2) no third party has any option or right to
acquire or lease any Owned Real Property (or any portion thereof), (3) there are
no Persons (other than the applicable Subject Company owning such Owned Real
Property) in possession of any Owned Real Property (or any portion thereof), or
that have any right to use or occupy any Owned Real Property (or any portion
thereof), and (4) no Subject Company has assigned, transferred, conveyed,
mortgaged, deeded in trust, or encumbered any interest in any Owned Real
Property (or any portion thereof).
(ii) Set forth on Schedule 4.11(a) is a true, correct and complete list of
(x) all of the Leased Real Property that is leased, subleased or otherwise
demised by the Subject Companies
41
and (y) all of the Real Property Leases. Except as set forth on Schedule
4.11(a), the Real Property Leases collectively constitute the entire agreements
with respect to the leasing by the Subject Companies of the Leased Real
Property; and (1) each Real Property Lease is a legal, valid and binding
Contract of the Subject Company that is a party thereto and, to the Selling
Parties' Knowledge, of the other parties thereto, in full force and effect,
enforceable in accordance with its terms, and has not been amended or modified
(beyond the amendments or modifications set forth in Schedule 4.11(a) as
constituting a part of such Real Property Lease), and, following the
consummation of the transactions contemplated hereby, shall continue to be
legal, valid, binding, enforceable and in full force and effect on identical
terms, (2) none of the Subject Companies nor, to the Selling Parties' Knowledge,
any other party to any of the Real Property Leases, is in material breach or
otherwise in material default thereunder, (3) true, correct and complete copies
of each of the Real Property Leases (including all schedules, exhibits and
amendments thereto) have been made available by the Selling Parties to Silgan,
(4) the leasehold estate in all the Leased Real Property is free and clear of
any Encumbrance, except for Permitted Encumbrances, (5) such leasehold estate
has not been assigned or otherwise transferred, nor has any portion of the
Leased Real Property been sublet, nor has any third party been granted any
option or right to acquire such leasehold estate or sublet any portion of the
Leased Real Property, (6) there are no Persons (other than the applicable
Subject Company leasing such Leased Real Property) in possession of the Leased
Real Property (or any portion thereof) or that have any right to use or occupy
the Leased Real Property (or any portion thereof), and (7) all rent, additional
rent and other charges due and payable (as of the date hereof) under each of the
Real Property Leases has been paid in full without offset, claim or reduction.
(iii) None of the Subject Companies own or lease any real property, except
for the real property at which the Real Property is located.
(iv) The operation of the Business does not require the ownership or use of
any real property other than the Real Property.
(v) The uses currently being made of the Real Property are in compliance in
all material respects with all zoning and other Laws applicable thereto.
(vi) No portion of the Real Property is subject to any pending, or, to the
Selling Parties' Knowledge, threatened, condemnation action.
(b) Personal Property Leases. (i) Each Personal Property Lease is a legal, valid
and binding Contract of the Subject Company that is a party thereto and, to the
Selling Parties' Knowledge, of the other parties thereto, enforceable in
accordance with its terms, (ii) each Personal Property Lease is in full force
and effect and (iii) no Subject Company, nor to the Selling Parties' Knowledge,
any other party thereto, is in material breach of or material default under any
Personal Property Lease beyond any applicable cure period. Correct and complete
copies of the Personal Property Leases (including all schedules, exhibits and
amendments thereto) with annual payments in excess of (euro)25,000 have been
made available by the Selling Parties to Silgan.
(c) Tangible Personal Property. Except for Tangible Personal Property sold or
otherwise disposed of since the date of the Financial Statements or as set forth
on Schedule 4.11(c), each Subject Company has good title to the Tangible
Personal Properties reflected on the Financial
42
Statements and, on the Closing Date, will have good title to the Tangible
Personal Property included in the Purchased Assets or the assets of the Acquired
Companies, in each case, free and clear of all Encumbrances, other than
Permitted Encumbrances and any lease of Tangible Personal Property whereby a
Subject Company is the lessee.
(d) Condition and Use of Tangible Personal Property. Except as set forth on
Schedule 4.11(d), all of the material Tangible Personal Property, other than
Inventory, currently used by the Subject Companies in the conduct of the
Business is in good working order, normal wear and tear excepted.
(e) Sufficiency. The assumption of the Assumed Liabilities hereunder and the
purchase of all of the Purchased Assets and the Purchased Equity hereunder are
sufficient (assuming sufficient employment levels) to permit Silgan and its
Affiliates to conduct the operations of the Business in substantially the same
manner as it is presently conducted and has been conducted since July 1, 2005.
Except as set forth on Schedule 4.11(c) or where the Subject Company is the
lessor of Tangible Personal Property, the Purchased Assets and the assets of the
Acquired Companies are in the exclusive possession and control of the Subject
Companies and no Person other than the Subject Companies is entitled to
possession of any portion of the Purchased Assets or the assets of the Acquired
Companies. The instruments of conveyance and transfer to be executed by the
Selling Parties and delivered to the Purchasers at the Closing (subject to
Section 3.4) will be valid in accordance with their terms and effective to
assign, transfer and convey to the Purchasers at the Closing all of the
Purchased Assets and Purchased Equity.
(f) No Manufacturing Operations. Except as set forth on Schedule 4.11(f), none
of Amcor Austria, Amcor Belgium, Amcor France S.A.S., Amcor Espana, Amcor
Sweden, Amcor Ukraine and Amcor UK currently engages or, since July 1, 2002, and
to the Selling Parties' Knowledge, prior to July 1, 2002, has ever engaged in
any manufacturing operations of any kind. None of Amcor Deutschland, Amcor
Polska, Amcor Investments, Amcor Properties, Amcor Asia Pacific, Amcor South
East Asia, Amcor Shanghai and Amcor Venezuela currently engages or, since July
1, 2002, and to the Selling Parties' Knowledge, prior to July 1, 2002, has ever
engaged in any manufacturing operations of any kind except in connection with
the Business.
Section 4.12 Contracts and Commitments.
-------------------------
(a) Schedule 4.12(a) hereto sets forth, as of the date hereof, a list of every
Assumed Contract and of every Contract that is currently in force to which any
Acquired Company is a party or by which any of its properties is bound, that, in
each case:
(i) provides for aggregate future payments by a Subject Company, or to a
Subject Company, of more than (euro)200,000;
(ii) is a Contract not entered into in the ordinary course of business
consistent with past practice which provides for aggregate future payments by a
Subject Company, or to a Subject Company, of more that (euro)50,000;
(iii) is a collective bargaining Contract or other Contract with a labour
union (including all side letters and side agreements);
43
(iv) restricts a Subject Company from engaging in any business in any part
of the world;
(v) is an employment Contract where the base compensation is in excess of
(euro)75,000 per year, or retention or change in control Contract that applies
to any transaction other than this Transaction, or material independent
contractor Contract with any director, officer or other Employee of any of the
Acquired Companies;
(vi) is with respect to the creation, operation, governance or management
of a partnership, joint venture, limited liability company or similar agreement
or is a stockholders' agreement, registration rights agreement, voting agreement
or proxy relating to the voting of any Capital Stock;
(vii) is a mortgage, indenture, security agreement relating to indebtedness
for borrowed money, letter of credit, promissory note, loan agreement and other
material agreement, guarantee and instrument relating to the borrowing of money
or extension of credit;
(viii) (A) is a stock purchase agreement whereby an Acquired Company bought
or sold an equity interest or (B) is an asset purchase agreement or other
acquisition or divestiture agreement whereby an Acquired Company bought or sold
a business or all or substantially all of the assets of a business for a price
in excess of (euro)500,000, in each case within the last three (3) years prior
to the date hereof; or
(ix) is a written amendment in respect of any of the foregoing
(the Contracts listed on Schedule 4.12(a) (in the case of Contracts called for
by Section 4.12(a)(i), only those meeting the threshold set forth in Section
4.12(a)(i)) are collectively referred to as the "Subject Company Contracts").
(b) Except as set forth on Schedule 4.12(b), as of the date hereof, (i) each
Subject Company Contract is a legal, valid and binding Contract of the Subject
Company that is a party thereto and, to the Selling Parties' Knowledge, of the
other parties thereto, enforceable in accordance with its terms, (ii) each
Subject Company Contract is in full force and effect and (iii) no Subject
Company, nor to the Selling Parties' Knowledge, any other Party thereto is in
material breach or material default under any Subject Company Contract or has
repudiated any term thereof. Correct and complete copies of the Subject Company
Contracts (including all schedules, exhibits and amendments thereto) have been
made available by the Selling Parties to Silgan.
(c) Except as set forth on Schedule 4.4, all the Subject Company Contracts that
are Assumed Contracts are assignable to the applicable Purchaser without
requiring any Consent of any Person and without resulting in any modification of
the rights or obligations thereunder.
(d) Except as set forth on Schedule 4.12(d), none of the Subject Companies has
received any written notice of termination, cancellation or non-renewal that is
currently in effect with respect to any Subject Company Contract.
(e) Except as set forth on Schedule 4.12(e), none of the Subject Companies is
under any liability or obligation with respect to the return of Inventory in the
possession of customers or other
44
Persons with an aggregate value in excess of (euro)25,000 on a per customer or
other Person basis or (euro)100,000 in the aggregate.
(f) Any Contract that is included in the Subject Company Contracts whereby a
Subject Company is not named as a party to such Contract has been validly
assigned to such Subject Company (other than assignments from one Subject
Company to another Subject Company).
Section 4.13 Insurance.
---------
(a) Schedule 4.13 sets forth for the Subject Companies relating to the conduct
of the Business: (i) the policies of insurance presently in force and, without
restricting the generality of the foregoing, those covering the Subject
Companies' public and product liability and their respective personnel,
properties, buildings, machinery, equipment, furniture, fixtures and operations,
specifying with respect to each such policy the name of the insurer, type of
coverage, term of policy and limits of liability; (ii) the Subject Companies'
losses in excess of (euro)250,000, by year and by type of coverage, for the past
two (2) years based on information received from the Subject Companies'
insurance carrier(s); (iii) all outstanding insurance claims in excess of
(euro)250,000 by the Subject Companies for damage to or loss of property or
income which have been referred to insurers or which any Subject Company
believes to be covered by commercial insurance; and (iv) commercial general
liability policies carried by the Subject Companies for the past two (2) years,
including excess liability policies. The Data Room contains complete and correct
copies of certificates of insurance with respect to the policies of insurance
and the agreements of the Acquired Companies set forth in Schedule 4.13.
(b) The insurance policies of the Acquired Companies set forth in Schedule 4.13
are in full force and effect, all premiums with respect thereto covering all
periods up to and including the Closing Date have been paid, and no notice of
cancellation or termination has been received with respect to any such policy.
Such policies will remain in full force and effect through the Closing Date
without the payment of additional premiums and during such period will not in
any way be materially adversely affected by the transactions contemplated by
this Agreement. None of the Subject Companies (in connection with the Business)
has been refused any insurance with respect to the respective assets or
operations of such Subject Company within the last two (2) years, nor has any
such coverage been limited within the last two (2) years, by any insurance
carrier to which any Subject Company has applied for any such insurance or with
which any of the Subject Companies has carried insurance during the last two (2)
years.
Section 4.14 Litigation.
----------
Except as set forth in Schedule 4.14, there is no action or proceeding pending
or, to the Selling Parties' Knowledge, threatened, (i) against or involving a
Subject Company (and, in the case of the Asset Sellers, concerning the Business
or the Purchased Assets) that if determined adversely to a Subject Company would
reasonably be expected to result in (a) an injunction or other equitable relief
or (b) a Loss by a Subject Company exceeding (euro)100,000 or (ii) that
questions the validity of this Agreement, any of the Ancillary Agreements or the
Transactions.
Section 4.15 Environmental Matters.
---------------------
(a) Except as set forth in Schedule 4.15,
45
(i) the Subject Companies possess all Environmental Permits currently
required under applicable Environmental Laws to operate the Business except as
would not reasonably be expected to cause a Material Adverse Effect, and within
applicable statutes of limitation, have been in compliance in all material
respects with the terms and conditions of such Environmental Permits, and none
of the Subject Companies have received written notice that any Environmental
Permits possessed by any of them with respect to the Business will be revoked,
suspended or will not be renewed;
(ii) to the Selling Parties' Knowledge, the execution and delivery of this
Agreement and the consummation of the transactions contemplated hereby will not
require any notification, registration, reporting, filing, investigation, or
remediation under any Environmental Law;
(iii) each of the Subject Companies is currently in compliance in all
material respects, and within applicable statutes of limitation, has been in
compliance in all material respects, with all applicable Environmental Laws with
respect to the Business (it being understood that for Environmental Laws
previously in effect, each of the Subject Companies was in compliance in all
material respects only during the time period such Environmental Law was in
effect);
(iv) (A) none of the Subject Companies has received written notice of any
civil, criminal or administrative action, hearing, notice of violation,
directive, summons, warning, order, notice or demand letter, or request for
information pending or, to the Selling Parties' Knowledge, threatened under any
Environmental Law against any of the Subject Companies; and (B) none of the
Subject Companies has received written notice of actual or potential liability
under any Environmental Law that has not been resolved, including, but not
limited to, any liability that the Subject Companies may have retained or
assumed either contractually or by operation of Law, in either case (A) or (B)
that would be reasonably likely to result, either individually or in the
aggregate, in material costs to the Subject Companies;
(v) (A) there has been no Release of any Hazardous Substance generated,
used, owned, stored or controlled by the Subject Companies or their respective
predecessors in interest, on, at, or under any property presently or formerly
owned, leased or operated by the Subject Companies or their predecessor except
in compliance in all material respects with Environmental Laws; and (B) to the
Selling Parties' Knowledge there are no Hazardous Substances located in, at, on,
or under such facility or property, or at any other location that could
reasonably be expected to require investigation, removal, remedial or corrective
action by the Subject Companies or that would reasonably be likely to result in
material liabilities of, or losses, damages or costs (including, response costs,
corrective action costs, damages for personal injury or property damage, or
natural resource damages) to any of the Subject Companies under any
Environmental Law;
(vi) to the Selling Parties' Knowledge, (A) there has not been any
underground or aboveground storage tank or other underground storage receptacle
or related piping, or any impoundment or other disposal area in each case
containing Hazardous Substances located on any facility owned, leased or
operated by the Subject Companies except in material compliance with
Environmental Laws, and (B) no asbestos or polychlorinated biphenyls have been
used or disposed of, or have been located at, on, or under such facility except
in compliance with applicable Environmental Laws; and
46
(vii) to the Selling Parties' Knowledge, there are no Encumbrances, other
than Permitted Encumbrances, registered against any properties, assets or
facilities based upon any applicable Environmental Law or for costs incurred in
response to any Release of Hazardous Substances.
(b) The Selling Parties have made available to Silgan and its authorized
representatives all material environmental records and files in their
possession, including all assessments, reports, studies, analyses, audits, tests
and data available to the Selling Parties concerning the Release of Hazardous
Substances or any other environmental concern at properties, assets and
facilities currently or formerly owned, operated or leased by the Subject
Companies or any predecessor in interest, or concerning compliance by the
Subject Companies with, or liability under, any Environmental Laws.
(c) Correct and complete copies of the Environmental Permits have been made
available by the Selling Parties to Silgan.
Section 4.16 Compliance with Laws and Orders.
-------------------------------
Except where the failure to do so would not reasonably be expected to result in
a Material Adverse Effect, the Subject Companies are in compliance with all
applicable Laws (except Environmental Laws which are addressed in Section 4.15)
and no action or proceeding is pending or, to the Selling Parties' Knowledge,
threatened, against any of the Subject Companies alleging any failure to so
comply.
Section 4.17 Employee Benefit Plans.
----------------------
(a) Subject to compliance with applicable Laws, Schedule 4.17(a) contains as at
a date a date not more than ten (10) days prior to the date hereof, the
following information for each Employee: date of birth, work location, hire
date, job title, salary level or monthly or hourly rate of pay and whether such
Employee is out on short or long-term disability or workers' compensation.
(b) Schedule 4.17(b) contains a complete list of each Benefit Plan that is
sponsored, maintained or contributed to by a Subject Company for the benefit of
any director, officer, Employee or Retired Employee of any Subject Company (in
the case of the Asset Sellers, to the extent related to the Business) (the
"Seller Benefit Plans"). Correct and complete copies of the Seller Benefit Plans
(including all schedules, exhibits and amendments thereto) have been made
available by the Selling Parties to Silgan. No provision or contributions have
been made towards any Benefit Plan other than the Seller Benefit Plans, nor is
there any obligation, liability or commitment by any Subject Company to provide
or contribute towards any Benefit Plan other than a Seller Benefit Plan in
respect of any present or past director, officer or Employee of such Subject
Company (or any spouse, child or dependant of any of them).
(c) Except as set forth on Schedule 4.17(c), the Selling Parties have heretofore
made available to Silgan, to the extent applicable to each Seller Benefit Plan,
a copy of (i) each Seller Benefit Plan and any amendments thereto, (ii) each
Contract creating or modifying in any respect any related trust or other funding
vehicle, (iii) the most recent financial and actuarial reports and summaries of
each Seller Benefit Plan required under applicable Law, (iv) all current
employee communications describing each Seller Benefit Plan and any
modifications thereto and (v) if
47
applicable, proof of registration of each Seller Benefit Plan with the
applicable Governmental Entities. There are no material benefits or entitlements
payable under the Seller Benefit Plans in respect of any director, officer,
Employee or Retired Employee of any Subject Company or their respective spouses
or dependants other than as set forth in the Seller Benefit Plans.
(d) Each Seller Benefit Plan has been established, maintained, operated and
administered in compliance in all material respects with its terms and
applicable Laws and has been funded in compliance with its terms and applicable
Laws. Each Seller Benefit Plan intended to be exempt from Tax by any
Governmental Entity has been established and administered in a manner consistent
with that purpose, and to the Selling Parties' Knowledge, there are no facts or
circumstances that would adversely affect the tax exempt status of any Seller
Benefit Plan. All required contributions due or payable to each Seller Benefit
Plan have been made and each Seller Benefit Plan is in material compliance with
any funding requirements imposed by applicable Law. The Financial Statements
fairly present in all material respects all liabilities of the Subject Companies
as required by IFRS under the Seller Benefit Plans as of and at the applicable
dates of such Financial Statements.
(e) All Seller Benefit Plans have been duly registered where required by
applicable Law. All reports with respect to the Seller Benefit Plans required to
be filed with any Governmental Entity have been duly filed. There are no pending
or, to the Selling Parties' Knowledge, threatened investigations, audits or
other proceedings or inquiries by any Governmental Entity concerning any Seller
Benefit Plan.
(f) No Seller Benefit Plan provides health, medical, life insurance or other
material benefits for Employees or Retired Employees of any Subject Company for
periods extending beyond their retirement or other termination of service,
except for coverage mandated by applicable Law and except for which the Subject
Company's liability was appropriately reflected on the Financial Statements as
of and at the applicable dates thereof.
(g) Except as set forth on Schedule 4.17(g), the consummation of the
transactions contemplated by this Agreement will not (i) entitle any Employee or
Retired Employee to severance pay, redundancy payments, indemnity payments,
change of control payments, unemployment compensation or any other payment or
benefit not expressly disclosed herein or, (ii) accelerate the time of payment
or vesting, or increase the amount of compensation, due to any Employee or
Retired Employee under any Seller Benefit Plan.
(h) Schedule 4.17(h) contains a complete list of (i) each Employee or Retired
Employee who may be entitled to benefits under a Seller Benefit Plan and (ii)
the applicable Seller Benefit Plan each Employee or Retired Employee
participates in.
(i) The consummation of the transactions contemplated by this Agreement will not
cause any automatic, immediate or contingent material amendments to the
governing provisions of any Seller Benefit Plans, whether as to the identity of
the persons entitled to exercise any powers or discretion, employer or member
contribution rates, increases to pensions in payment and/or deferment, the
benefit structure or otherwise.
48
(j) Except as set forth on Schedule 4.17(j), no event has occurred or will occur
as a result of the Transactions which would or would reasonably be expected to
entitle any Person (without the consent of Subject Companies or their successors
in business) to wind up, terminate or close any Seller Benefit Plans in whole or
in part.
Section 4.18 Tax Matters.
-----------
(a) Each Acquired Company and each Asset Seller (insofar as it relates to the
Business) has timely filed (or has had timely filed on its behalf) or will
timely file or cause to be timely filed, all material Tax Returns required by
applicable Law to be filed by it prior to or as of the Closing Date. All such
Tax Returns are or will be complete and correct in all material respects.
(b) Each Acquired Company and each Asset Seller (insofar as it relates to the
Business) has timely paid (or has had timely paid on its behalf) or will timely
pay (or will have timely paid on its behalf) all material Taxes falling due
prior to the Closing Date (whether or not on a Tax Return).
(c) There are no Encumbrances for Taxes upon any property of a Subject Company,
except for Permitted Encumbrances and liens for local property Taxes and
assessments in the ordinary course of business assessed by state or local
jurisdictions not delinquent beyond any cure period.
(d) Except as set forth on Schedule 4.18, no audits, examinations,
investigations or other administrative proceedings or court proceedings are
pending with regard to any Tax Returns filed by or on behalf of an Acquired
Company, or Asset Seller (insofar as it relates to the Business) except for
those the adverse resolution of which would not reasonably be expected to have a
Material Adverse Effect.
(e) Except as set forth on Schedule 4.18, there are no outstanding consents to
extend the statutory period of limitations applicable to the assessment of any
Taxes or deficiencies against any Acquired Company.
(f) Except as set forth on Schedule 4.18(f), to the Selling Parties' Knowledge,
the transactions contemplated by this Agreement are not subject to any Tax
withholding.
(g) No claim has ever been made by a Government Entity in a jurisdiction where
the Acquired Companies or Asset Sellers (insofar as it relates to the Business)
do not file Tax Returns that any of them may be subject to taxation in that
jurisdiction.
(h) Each of the Acquired Companies and the Asset Sellers (insofar as it relates
to the Business) have timely withheld and paid all Taxes required to have been
withheld and paid in connection with any amounts paid or owing to any employee,
independent contractor, creditor, stockholder, or third party.
(i) None of the Assumed Liabilities is an obligation to make a payment that is
not deductible under section 280G of the US Internal Revenue Code.
(j) None of the Acquired Companies is a party to, or bound by, any Tax
allocation or sharing agreement.
49
(k) Except as set forth on Schedule 4.18(k), there is no taxable income of any
of the Acquired Companies or any Asset Seller (insofar as it relates to the
Business) that will be reportable in a taxable period beginning after the
Closing Date as a result of an installment sale or a transaction that is treated
as an "open" transaction for U.S. federal income tax purposes.
Section 4.19 Company Intellectual Property.
-----------------------------
(a) Schedule 4.19(a) identifies (i) each patent registration, patent
application, trademark registration and application, copyright registration and
application and domain name (the "Registered Intellectual Property") and each
material unregistered trademark or trade name that is used or intended for use
by the Subject Companies (and in the case of the Asset Sellers, in connection
with the Business) and sets forth the jurisdiction where such Registered
Intellectual Property is registered and (ii) all the Licenses other than
Licenses concerning non-proprietary software.
(b) Except as set forth on Schedule 4.19(b),
(i) subject to any Excluded Assets, the Company Intellectual Property
includes all of the intellectual property rights necessary to conduct the
Business as presently conducted other than the name "Amcor";
(ii) the Registered Intellectual Property that is registered and listed on
Schedule 4.19(a) is valid, in full force and effect and, to the Selling Parties'
Knowledge, has not been used or enforced or failed to be used or enforced in a
manner that would result in the abandonment, cancellation or unenforceability of
any rights in and to such Intellectual Property, except as regards Intellectual
Property that is not required for the operation of the Business as presently
conducted;
(iii) except with respect to the Licenses, the Subject Companies are the
exclusive owners of all right, title and interest in and to the Registered
Intellectual Property, free and clear of any Encumbrance, other than Permitted
Encumbrances;
(iv) to the Selling Parties' Knowledge, (A) the operation of the Business
as it is presently conducted does not infringe, misappropriate or otherwise
violate any Intellectual Property of any third party to such extent that it
would reasonably be expected to have a Material Adverse Effect; (B) the Subject
Companies have not received, within the past 12 months, any written notice or
office action: (x) alleging any infringement or misappropriation of Intellectual
Property with respect to the Business; (y) challenging the validity,
enforceability or ownership (except with respect to Licenses where the Subject
Company is the Licensee) by the Subject Companies of any of the Company
Intellectual Property; or (z) claiming that the current use, distribution,
licensing, sublicensing, sale, exercise or other commercial exploitation by the
Subject Companies of the Company Intellectual Property infringes on any
Intellectual Property of any third party; and (C) there are no pending claims or
proceedings, including oppositions, interferences, concurrent use, ex parte
appeals and re-examinations relating to the Company Intellectual Property that
would reasonably be expected to have a Material Adverse Effect;
50
(v) to the Selling Parties' Knowledge, no third party is engaged in
unauthorized use, infringement or misappropriation of any of the Registered
Intellectual Property listed on Schedule 4.19(a);
(vi) as of the date hereof, (A) each License is a legal, valid and binding
Contract of the Subject Company that is a party thereto and, to the Selling
Parties' Knowledge, of the other parties thereto, enforceable against such
Subject Company and, to the Selling Parties' Knowledge, the other parties
thereto in accordance with its terms, (B) each License is in full force and
effect and (C) no Subject Company, nor to the Selling Parties' Knowledge, any
other Party thereto is in material breach or material default under any License
or has repudiated any term thereof;
(vii) the Subject Companies have not transferred ownership of, or granted
any exclusive license with respect to, any of the Registered Intellectual
Property to any third party;
(viii) subject to any agreements or restrictions affecting the Purchasers
and subject to obtaining required Consents from licensors, the Purchasers,
following the Closing Date, will be permitted to exercise all of the Asset
Sellers' rights under the Company Intellectual Property to the same extent the
Asset Sellers would have been able to had the transactions contemplated by this
Agreement not occurred and without the payment of any additional funds other
than ongoing fees, royalties or payments which the Purchasers would otherwise be
required to pay;
(ix) subject to any agreements or restrictions affecting the Acquired
Companies and subject to obtaining required Consents from licensors, the
Acquired Companies, following the Closing Date, will be permitted to exercise
all of the Acquired Companies' rights under the Company Intellectual Property to
the same extent the Acquired Companies would have been able to had the
transactions contemplated by this Agreement not occurred and without the payment
of any additional funds other than ongoing fees, royalties or payments which the
Acquired Companies would otherwise be required to pay;
(x) with respect to each item of the Registered Intellectual Property, but
except as regards such Intellectual Property that is not required for the
operation of the Business as presently conducted, (A) necessary title
recordation documents, including assignments and changes of name and (B)
necessary registration, maintenance and renewal fees in connection with such
Registered Intellectual Property have been made in the jurisdictions where such
Registered Intellectual Property is registered as set forth on Schedule 4.19(a)
and all necessary documents and certificates in connection with such Registered
Intellectual Property have been filed with the relevant patent, trademark or
copyright authorities in such jurisdictions for the purposes of maintaining such
Registered Intellectual Property and (C) the Subject Companies will take all
steps necessary to preserve and maintain all right, title and interest in and to
the Company Intellectual Property through the Closing Date; and
(xi) the Subject Companies have valid registrations and all material rights
(free of any material restriction) in and to their domain names that are part of
the Company Intellectual Property.
51
(c) Correct and complete copies of the Licenses entered into on or after July 1,
2002 that are set forth on Schedule 4.19(a) (including all schedules, exhibits
and amendments thereto) have been made available by the Selling Parties to
Silgan. The Selling Parties have made available to Silgan all copies in their
possession of the Licenses (including all schedules, exhibits and amendments
thereto) entered into before July 1, 2002 that are set forth on Schedule
4.19(a).
Section 4.20 Labour Matters.
--------------
Except as set forth on Schedule 4.20:
(a) there is not currently, and for the past two (2) years, there has not been,
any labour strike, slowdown or other work stoppage with respect to a Subject
Company;
(b) no Subject Company (in the case of the Asset Sellers, relating to the
Business) is a party to or bound by any collective bargaining Contract or any
Contract with any trade union, employee representative or body of employees or
their representatives (including any side letters or side agreements);
(c) there is not any pending or to the Selling Parties' Knowledge, threatened,
any material unfair labour practices charges or complaints or material, sex, age
or other discrimination claims against any Subject Company (in the case of an
Asset Seller, relating to the Business);
(d) the Subject Companies have complied in all material respects with all
collective bargaining Contracts and any orders or judgments resulting from
alleged violations of any labor Laws;
(e) to the Selling Parties' Knowledge, there is not currently, and for the past
three (3) years, there has not been any union organizing activity concerning any
of the Employees;
(f) since July 1, 2005, no Subject Company has planned, proposed or effectuated
any plant closing or mass layoff of Employees relating to the Business that
would implicate any Law requiring notice of plant closings or layoffs;
(g) any notice of this Transaction required by any Law, or collective bargaining
Contract by a Subject Company has, or shall prior to Closing have, been given,
and any bargaining and consultation obligations have been, or prior to Closing
will be, satisfied;
(h) each Subject Company has complied with all Contracts relating to or
respecting Employees and Retired Employees, including, all regulations, policies
and procedures affecting Employees and Retired Employees, except where such
non-compliance would not reasonably be expected to have a Material Adverse
Effect;
(i) no written notice to terminate the Contract of employment of any Employee
whose compensation is in excess of (euro)75,000 (whether given by the relevant
employer or by the Employee) is pending, outstanding or, to the Selling Parties'
Knowledge, threatened and no dispute, claim or complaint under any applicable
Law is outstanding in relation to any current or former Employees, directors or
officers relating to their employment or its termination that would reasonably
be expected to result in a Loss in excess of (euro)75,000;
52
(j) no Subject Company (in the case of the Asset Sellers, relating to the
Business) is a party to, bound by or proposing to introduce in respect of any of
its directors or Employees any redundancy payment scheme in addition to
statutory redundancy pay, nor is there any agreed procedure for redundancy
selection; and
(k) correct and complete copies of any collective bargaining Contract and any
Contract with any trade union, employee representative or body of employees or
their representatives (including any side letters, side agreements, schedules,
exhibits and amendments thereto) to which a Subject Company (in the case of the
Asset Sellers, relating to the Business) is a party have been made available to
Silgan.
Section 4.21 Bank Accounts.
-------------
Schedule 4.21 sets forth (i) the names, locations and account numbers of all
banks, trust companies, savings and loan associations and other financial
institutions at which an Acquired Company maintains lockboxes, safe deposit
boxes, marketable securities, savings accounts, checking accounts or other
accounts of any nature relating to the Business and (ii) the names of all
Persons authorized to draw thereon, make withdrawals therefrom or have access
thereto.
Section 4.22 Brokers or Finders.
------------------
Except as set forth in Schedule 4.22, no Selling Party and no Subject Company,
and no Person acting on their behalf, has entered into any Contract entitling
any agent, broker, investment banker, financial advisor or other Person to any
brokers' or finder's fee or any other commission or similar fee in connection
with any of the Transactions.
Section 4.23 Receivables and Payables.
------------------------
All Receivables and payables of the Subject Companies relating to the conduct of
the Business have arisen from bona fide transactions in the ordinary course of
business. The Subject Companies have not collected, or accelerated the
collection of, any Receivables in a manner that is inconsistent with the
operation of the Business in the ordinary course consistent with past practice.
Section 4.24 Inventory.
---------
Except as disclosed in Schedule 4.24, all Inventory used in the Business
conforms in all material respects with all applicable specifications and
warranties, is not obsolete, is useable or saleable in the ordinary course of
business and, if saleable, is saleable at values not less than the book value
amounts thereof except to the extent adequately reserved. All work-in-process
and finished goods included in such Inventory have been produced in compliance
with all applicable quality control procedures. The value of all items of
obsolete materials and of materials of below standard quality has been written
down to net realizable value or adequate reserves have been provided therefor.
All Inventory is valued at the lower of cost or market in accordance with IFRS
consistently applied.
53
Section 4.25 Books and Records.
-----------------
Since July 1, 2002, all books of account and other financial books and records
of the Subject Companies relating to the Business or the Purchased Assets are
true, correct and complete in all material respects and have been maintained in
accordance with sound business practices. Since July 1, 2002, such books and
records reflect all the transactions and other matters required to be set forth
under IFRS or other applicable accounting rules applied on a consistent basis.
Section 4.26 Affiliates Interests.
--------------------
(a) Schedule 4.26 sets forth separately for each of the Subject Companies (i)
all amounts paid (or deemed for accounting purposes to have been paid) by such
Subject Company to, or received by such Subject Company from, Amcor Australia or
any of its Affiliates (except the Acquired Companies) since July 1, 2004
(including any charge for administrative, purchasing, financial or other
services) and all such amounts currently owed by such Subject Company to, or
owing to such Subject Company from, Amcor Australia or any of its Affiliates
(except the Acquired Companies) and (ii) all products and services provided by
such Subject Company to, or received by such Subject Company from, Amcor
Australia or any of its Affiliates (except the Acquired Companies) since January
1, 2005.
(b) Schedule 4.26 sets forth each written Contract between or among any of (i)
the Acquired Companies, on the one hand, and Amcor Australia or any of its other
Affiliates (other than an Acquired Company), on the other hand, or (ii) the
Asset Sellers (in connection with the Business), on the one hand, and Amcor
Australia or any of its other Affiliates, on the other hand. Correct and
complete copies of the Contracts set forth on Schedule 4.26 (including all
schedules, exhibits and amendments thereto) as they relate to the Business have
been made available by the Selling Parties to Silgan.
(c) Except as set forth in Schedule 4.26, to the Selling Parties' Knowledge, no
officer, manager, director, employee or agent of any of the Subject Companies or
any Affiliate of any Subject Company has any interest in any Real Property Lease
or Personal Property Lease.
Section 4.27 Customers, Suppliers, Distributors Etc.
---------------------------------------
Schedule 4.27 sets forth with respect to the fiscal years ended June 30, 2004
and 2005 a true and complete list of (i) the five (5) largest customers of the
Business in China, the five (5) largest customers of the Business in South Asia,
the five (5) largest customers of the Business in Venezuela, the five (5)
largest customers of the Business in Brazil and the thirty (30) largest
customers of the Business (Europe only) (in each case, in closures volume)
(collectively, the "Major Customers") and (ii) the four (4) largest suppliers to
the Business in Europe of tin plate, the three (3) largest suppliers to the
Business in Europe of coating, the four (4) largest suppliers to the Business in
Europe of compound, the four (4) largest suppliers to the Business in Asia of
tin plate, the three (3) largest suppliers to the Business in Asia of coating
and the largest supplier to the Business in Asia of compound, the four (4)
largest suppliers to the Business in South America of tin plate, the three (3)
largest suppliers to the Business in South America of coating and the three (3)
largest suppliers to the Business in South America of compound (in Euro volume)
(collectively, the "Major Suppliers"). Except as set forth in Schedule 4.27, no
Major
54
Supplier or Major Customer has canceled or otherwise terminated, or made any
written or, to each Selling Parties' Knowledge, oral threat to any of the
Subject Companies or to any of their Affiliates to cancel or otherwise
terminate, for any reason, including the consummation of the transactions
contemplated by this Agreement or the Ancillary Agreements, its relationship
with the Business, or has at any time on or after June 30, 2005 decreased
materially its services or supplies to the Business in the case of any such
Major Supplier or its usage or purchase of the services or products of the
Business in the case of any such Major Customer.
Section 4.28 Products.
--------
Schedule 4.28 sets forth as it relates to the Business all actions or
proceedings instituted at any time during the two (2) years preceding the date
hereof against any of the Subject Companies in respect of personal injury,
wrongful death or property damage in excess of (euro)100,000 alleged to have
resulted from the products or services provided by any of the Subject Companies.
Except as set forth on Schedule 4.28, there have been no breach of warranty or
breach of representation claims against any of the Subject Companies in
connection with the Business during the two (2) years preceding the date hereof
which have resulted in any cost or expenditure to any of the Subject Companies
in excess of (euro)100,000.
Section 4.29 Powers of Attorney.
------------------
Except as set forth on Schedule 4.29 and except for shippers and freight
forwarders acting in the ordinary course of business, there are no Persons
holding general or special powers of attorney from any of the Acquired
Companies.
Section 4.30 Computer Systems; Financial Reporting.
-------------------------------------
To the Selling Parties' Knowledge, the computer systems, procedures, databases,
software programs, and all other similar assets (the "Computer Assets") owned or
leased by, or used in the Business are in good working order and are sufficient
in all respects for the Business as now being conducted. The Computer Assets and
the financial reporting policies and procedures of each of the Subject Companies
are sufficient in all material respects for conducting timely, accurate and
complete reporting of all financial transactions.
Section 4.31 Permits.
-------
The Subject Companies have obtained or applied for, and are in compliance with,
all Governmental Permits (except Environmental Permits) that are required by any
Governmental Entity to conduct the Business as presently conducted, except for
such failures to hold or comply with such Permits that would not have a Material
Adverse Effect.
Section 4.32 Absence of Certain Business Practices.
-------------------------------------
Since January 1, 2003, neither any Subject Company, nor any of their current or
former shareholders, directors, officers, employees or agents or other
representatives, nor any other Person acting on their behalf, has directly or
indirectly, given or agreed to give any material contribution, gift or similar
benefit to or for the private use of or at the direction of any customer,
client, supplier, governmental employee or other Person who is in a position to
help or hinder the
55
Business that is reasonably likely to subject any Subject Company to any damage
or penalty in any action or proceeding in any jurisdiction.
Section 4.33 Subsidies and Grants.
--------------------
Schedule 4.33 sets forth all subsidies, investment incentives, grants and
similar arrangements from a Governmental Entity that by their terms impose
material obligations on any Subject Company.
Section 4.34 Limitations on Representations and Warranties; Disclosure.
---------------------------------------------------------
Except for the representations and warranties set forth in this Article IV, the
Selling Parties make no representation or warranty, express or implied, at Law
or in equity, in respect of the Business, the Purchased Equity, the Purchased
Assets or the Assumed Liabilities, including with respect to the merchantability
or fitness for any particular purpose, and any such other representations or
warranties are hereby expressly disclaimed. In furtherance of the foregoing, any
representation and warranty or other rights that may be implied by Law in any
jurisdiction in relation to the sale of the Purchased Equity, the Purchased
Assets or the Business or the assumption of the Assumed Liabilities, in such
jurisdiction shall, to the extent permitted under applicable Law, be excluded
or, if incapable of exclusion, irrevocably waived and, subject and without
prejudice to the Selling Parties' indemnification obligations pursuant to
Article X, Purchaser agrees to indemnify and hold the Selling Parties harmless
in respect of any Losses arising or incurred as a result of claims under any
such implied representations and warranties and other rights of Purchaser or any
of its Affiliates or their respective successors in interest or title (including
any providers of financing to Purchaser).
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF SILGAN
Silgan hereby makes the following representations and warranties to the Selling
Parties:
Section 5.1 Organization.
------------
Silgan is a corporation incorporated under the laws of the state of Delaware.
Silgan is, and each Purchaser will be when formed, duly organized, validly
existing and in good standing under the Laws of their respective jurisdictions
of formation and Silgan has, and each Purchaser when formed will have, all
requisite power, authority and legal capacity to execute and deliver this
Agreement and each Ancillary Agreement to which it is a party and to perform
their respective obligations hereunder and thereunder.
Section 5.2 Authorization; Validity of Agreement.
------------------------------------
The execution, delivery and performance by Silgan of this Agreement and each
Ancillary Agreement to which it is a party and the consummation of the
Transactions have been duly authorized by all requisite action on the part of
Silgan and, except as set forth on Schedule 5.2, no other action on the part of
Silgan will be necessary to authorize the execution and delivery by Silgan of
this Agreement and each Ancillary Agreement to which it is a party, or the
consummation of the Transactions. The execution, delivery and performance by
each Purchaser
56
of each Ancillary Agreement to which it will be a party and the consummation of
the Transactions will be duly authorized by all requisite action on the part of
each Purchaser and no other action on the part of such Purchaser will be
necessary to authorize the execution and delivery by such Purchaserof each
Ancillary Agreement to which it is a party or the consummation of the
Transactions. No vote of, or Consent or other action by, the holders of any
class of Capital Stock issued by Silgan is, or any Purchaser will be, necessary
to authorize the execution and delivery by Silgan or any Purchaser of this
Agreement or any Ancillary Agreement to which it is a party or the consummation
by it of the Transactions. This Agreement is duly executed and delivered by
Silgan. Each of the Ancillary Agreements when executed and delivered will be
duly executed and delivered by Silgan and the applicable Purchaser. This
Agreement is, and each of the Ancillary Agreements to which it or any of its
Affiliates is a party when executed and delivered will be, valid and binding
obligations of Silgan and the applicable Purchaser, enforceable against Silgan
and the applicable Purchaser in accordance with their terms except (i) as
limited by applicable bankruptcy, insolvency, reorganization, moratorium,
fraudulent conveyance and other similar Laws of general application affecting
enforcement of creditors' rights generally, and (ii) the availability of the
remedy of specific performance or injunctive or other forms of equitable relief
may be subject to equitable defenses and would be subject to the discretion of
the court before which any proceeding therefor may be brought.
Section 5.3 Consents and Approvals; No Violations.
-------------------------------------
Except as set forth on Schedule 5.3, none of the execution, delivery or
performance by Silgan or any Purchaser of this Agreement or any Ancillary
Agreement to which it is a party, compliance by Silgan or any Purchaser with any
of the provisions hereof or of any Ancillary Agreement to which it is a party,
or the consummation by Silgan or any Purchaser of the Transactions will (i)
conflict with or result in any breach of any provision of the Operating Document
or Organizational Document of Silgan or any Purchaser; (ii) require any filing
with, notice prior to Closing to, or Consent of, any Person; (iii) result in a
violation or breach of, or constitute (with or without due notice or lapse of
time or both) a default under, any of the terms of any Contract to which Silgan
or any Purchaser is a party or by which Silgan or any Purchaser or any of their
respective properties may be bound; or (iv) violate any Law applicable to Silgan
or any Purchaser or to any of their respective properties, excluding from the
foregoing clauses (ii), (iii) and (iv) such violations, breaches or defaults
that would not, individually or in the aggregate, reasonably be expected to have
a material adverse effect on Silgan or its ability to consummate the
Transactions.
Section 5.4 Acquisition of Purchased Equity for Investment; Ability to
----------------------------------------------------------
Evaluate and Bear Risk.
----------------------
(a) Each Purchaser is acquiring the Purchased Equity for investment and not with
a view toward, or for sale in connection with, any distribution thereof, nor
with any present intention of distributing or selling the Purchased Equity.
Silgan agrees that the Purchased Equity may not be sold, transferred, offered
for sale, pledged, hypothecated or otherwise disposed of without registration
under any applicable securities Laws, except pursuant to an exemption from such
registration under such Laws.
57
(b) Each Purchaser is able to bear the economic risk of holding the Purchased
Equity for an indefinite period and has knowledge and experience in financial
and business matters such that it is capable of evaluating the risks of the
investment in the Purchased Equity.
Section 5.5 Litigation.
----------
There is no action or proceeding pending or, to Silgan's knowledge, threatened
against Silgan or any of its Affiliates by or before any court or Governmental
Entity that, individually or in the aggregate, would or would reasonably be
expected to impede the ability of Silgan or any Purchaser to consummate the
Transactions.
Section 5.6 Investigation by Purchaser; Selling Parties' Liability.
------------------------------------------------------
Silgan has conducted its own independent investigation, review and analysis of
the business, operations, properties, liabilities, results of operations,
financial condition, software, technology and prospects of the Subject
Companies, which investigation, review and analysis was done by Silgan and its
Affiliates and, to the extent Silgan deemed appropriate, by Silgan's
representatives. Silgan acknowledges that it and its representatives have been
provided adequate access to the Data Room and to the personnel, properties,
premises and records of the Subject Companies for such purpose. In entering into
this Agreement, Silgan acknowledges that it has relied solely upon the
aforementioned investigation, review and analysis and not on any factual
representations or opinions of the Selling Parties or any of the Selling
Parties' representatives (except the specific representations and warranties of
the Selling Parties set forth in Article IV of this Agreement), and Silgan:
(a) acknowledges that none of the Selling Parties or the Subject Companies or
any of their respective directors, officers, shareholders, employees,
Affiliates, agents, advisors or representatives makes or has made any oral or
written representation or warranty, either express or implied, as to the
accuracy or completeness of any of the information (including any estimates,
projections, forecasts, operating plans or budgets concerning financial or other
information relating to the Subject Companies or the Business) provided or made
available to Silgan or its directors, officers, employees, Affiliates, agents or
representatives (including (i) in materials furnished in the Data Room or
contained on the Data Room Disk; (ii) in presentations by the Selling Parties'
or the Subject Companies' management; or (iii) otherwise), except that the
foregoing limitations shall not apply to the Selling Parties insofar as they
make the specific representations and warranties set forth in Article IV of this
Agreement;
(b) agrees, to the fullest extent permitted by Law, that none of the Selling
Parties or the Subject Companies nor any of their respective directors,
officers, employees, shareholders, Affiliates, agents, advisors or
representatives shall have any liability, obligation or responsibility
whatsoever to Silgan or its directors, officers, employees, Affiliates, agents
or representatives on any basis (including in contract or tort, as a fiduciary,
under any applicable law or otherwise) based upon any information (including any
estimates, projections, forecasts, operating plans or budgets concerning
financial or other information relating to the Business) provided or made
available, or statements made (including (i) in materials furnished in the Data
Room or contained on the Data Room Disk; (ii) in presentations by the Selling
Parties' or the Subject Companies' management; or (iii) otherwise) to Silgan or
its directors, officers, employees, Affiliates,
58
advisors, agents or representatives (or any omissions therefrom), except that
the foregoing limitations shall not apply to the Selling Parties insofar as they
make the specific representations and warranties set forth in Article IV of this
Agreement; and
(c) agrees that this is an arm's length transaction in which the Parties'
undertakings and obligations are limited to the performance of their obligations
under this Agreement and the Ancillary Agreements, that Silgan has only a
contractual relationship with the Selling Parties, based solely on the terms of
this Agreement and the Ancillary Agreements, and that there is no special
relationship of trust or reliance between Silgan and the Selling Parties.
Section 5.7 Brokers or Finders.
------------------
Neither Silgan nor any Person acting on its behalf has entered into any Contract
entitling any agent, broker, investment banker, financial advisor or other
Person to any broker's or finder's fee or any other commissions or similar fees
in connection with any of the Transactions.
ARTICLE VI
CERTAIN COVENANTS AND AGREEMENTS
Section 6.1 Interim Operations of the Subject Companies.
-------------------------------------------
Except (i) as expressly provided in this Agreement; (ii) as set forth in
Schedule 6.1; or (iii) as may be consented to in writing by Silgan (such consent
not to be unreasonably withheld, delayed or conditioned), the Selling Parties
shall procure that, after the date hereof and prior to the Closing Date, the
Subject Companies shall conduct the Business only in the ordinary course and no
Subject Company shall take, or agree to take, any action that would or would be
reasonably likely to result in a breach of the first sentence of Section 4.10 or
the occurrence of any event or matter set forth in Section 4.10(a) through
Section 4.10(r), and the Selling Parties shall cause each Subject Company to:
(a) refrain from waiving, releasing or canceling any material claims against
third parties or material debts owing to any of the Subject Companies, other
than in respect of claims or debts that would be Excluded Assets, except in the
ordinary course of business consistent with past practice;
(b) refrain from negotiating, amending, renewing or otherwise executing any
collective bargaining agreement or other labor agreement or voluntarily
reorganizing a labor organization concerning or affecting the Business, except
in the ordinary course of business consistent with past practice;
(c) refrain from making any material change in any accounting principle, method,
estimate or practice, except for any such change required by reason of a
concurrent change in IFRS;
(d) maintain in all material respects all insurance coverage of the Business in
place as maintained prior to the date hereof;
(e) comply in all material respects with and operate the Business in compliance
in all material respects with all applicable Laws, including Environmental Laws;
59
(f) maintain in all material respects all books and records pertaining to the
Business and the Purchased Assets in the manner such books and records have been
maintained by the Subject Companies prior to the date hereof;
(g) pay all Taxes, accounts payable and other liabilities of the Business when
due consistent with past practice; and
(h) refrain from entering into any Contract to do any of the actions described
in (a) through (g) of this Section 6.1.
Section 6.2 Access; Confidentiality.
-----------------------
The Selling Parties shall cause the Subject Companies prior to the Closing to
(i) give Silgan and its authorized representatives reasonable access to all
books, records, personnel reasonably designated by Amcor, offices and other
facilities and properties of the Subject Companies relating to the Business;
(ii) permit Silgan to make such copies and inspections thereof as Silgan may
reasonably request; (iii) cause the officers of the Subject Companies to furnish
Silgan with such financial and operating data and other information with respect
to the Business and the properties of the Subject Companies as Silgan may from
time to time reasonably request, including, assessments, audits, studies and
data to which the Selling Parties have access concerning the existence of
Hazardous Substances at facilities or properties presently or formerly owned,
operated, leased or used by the Subject Companies or any predecessors in
interest or concerning compliance with, or liability under, any Environmental
Laws; and (iv) permit Silgan and its authorized representatives to conduct
inspections as they may reasonably require (including any air, water, soil, or
other testing and monitoring deemed necessary by Silgan); provided, however,
that any such access shall be conducted at Silgan's expense, at a reasonable
time, under the supervision of the Subject Companies' personnel and in such a
manner as to maintain the confidentiality of this Agreement and the Transactions
and not to interfere with the normal operation of the business of the Subject
Companies or the Business, and in compliance with any other reasonable
requirements of the Subject Companies, including as to security and insurance.
Without in any manner limiting the generality of the foregoing, (1) no physical
work or tests involving the Real Property shall be performed by Silgan without
the prior written consent of the Selling Parties, such consent not to be
unreasonably withheld, conditioned or delayed, (2) any environmental
investigations shall be in compliance with all applicable Laws relating to the
protection of human health and the Environment, (3) Silgan will indemnify and
hold the Selling Parties harmless from and against all costs, expenses and
damages which the Selling Parties may incur or suffer to the extent that such
costs, expenses or damages arise directly out of or result directly from the
conduct of the investigations by Silgan and its authorized representatives
(excluding any costs, expenses or damages to respond to any pre-existing
environmental issues that are discovered as a result of such investigations),
(4) Silgan will promptly provide the Selling Parties with a copy of results
and/or reports resulting from the conduct of any environmental investigations
and (5) Silgan will notify the Selling Parties as soon as practicable if any
condition is discovered during the course of any environmental investigations
that Silgan believes may, under any Law regulating the protection of human
health or the Environment, give rise to an obligation to notify any Governmental
Entity. Notwithstanding anything contained in this Agreement or any other
Contract between Silgan and any Selling Party, but subject to Section 9.2, none
of the Selling Parties, the Subject Companies,
60
or any of their Affiliates shall have any obligation to make available to Silgan
or its representatives, or provide Silgan or its representatives with, any
consolidated, combined or unitary Tax Return filed by the Selling Parties or any
of their Affiliates or their respective predecessors, or any related material,
and nothing herein shall require a Selling Party or a Subject Company to
disclose any information to Silgan if such disclosure would, in the Selling
Parties' reasonable discretion (i) cause significant competitive harm to a
Selling Party, a Subject Company or one of their Affiliates if the Transactions
are not consummated (in which case such information shall be disclosed only to
the officers of Silgan holding the position of Senior Vice President or higher,
who require such information for purposes of the Transactions and who shall use
such information solely for the purpose of the Transactions), (ii) jeopardize
any attorney-client or other legal privilege or (iii) contravene any applicable
Laws, fiduciary duty or Contract (including any confidentiality agreement) to
which a Selling Party or any Affiliate of a Selling Party is a party.
Section 6.3 Efforts and Actions to Cause Closing to Occur.
---------------------------------------------
(a) Prior to the Closing, upon the terms and subject to the conditions of this
Agreement, Silgan and the Selling Parties shall use their respective
commercially reasonable efforts to take, or cause to be taken, all actions, and
to do, or cause to be done and cooperate with each other in order to do, or
cause to be done, all things reasonably required to consummate the Transactions
as promptly as practicable, including the preparation and filing of all forms,
registrations and notices required to be filed to consummate the Transactions
and the taking of such actions as are reasonably required to obtain any
requisite Consents, orders, permits, qualifications, or exemptions by any
Person. In addition, no Party (or any of its respective Affiliates) shall take
any action after the date hereof that would reasonably be expected to materially
delay the obtaining of, or result in not obtaining, any Consent from any Person
required to be obtained prior to Closing. Purchaser shall provide its publicly
filed financial statements as may be reasonably requested by any third party
whose Consent is sought hereunder. Nothing contained in this Agreement shall
require any Selling Party or any Purchaser to pay any consideration (other than
filing or application fees) or provide any other incentive to any Person from
whom any such Consents, orders, permits, qualifications or exemptions is
requested, or to commence any litigation in respect of same.
(b) Prior to the Closing, each Party shall promptly consult with the other Party
with respect to and provide any information reasonably required with respect to
all filings made by such Party with any Governmental Entity or any other
information supplied by such Party to a Governmental Entity in connection with
this Agreement and the Transactions. Each Party shall promptly inform each of
the other Parties in writing of any communication received by such Party from
any Governmental Entity regarding the Transactions. If any Party or Affiliate
thereof receives a request for information or documentary material from any
Governmental Entity with respect to any of the Transactions, then such Party
shall endeavour in good faith to make, or cause to be made, as soon as
reasonably practicable and after consultation with the other Parties, an
appropriate response in compliance with such request.
(c) In addition to and without limiting the agreements of the Parties contained
above, Silgan and the Selling Parties shall (i) take promptly all actions
reasonably required to make the filings required of them or any of their
respective Affiliates under any applicable Antitrust Law; (ii)
61
comply at the earliest practicable date with any request for additional
information or documentary material received by Silgan, the Selling Parties or
any of their respective Affiliates from any Antitrust Administrator or from any
other Governmental Entity in connection with antitrust matters; (iii) cooperate
with each other in connection with any filing under any applicable Antitrust Law
and in connection with resolving any investigation or other inquiry concerning
the Transactions commenced by any Antitrust Administrator or any other
Governmental Entity; (iv) use their commercially reasonable efforts to resolve
such objections, if any, as may be asserted with respect to the Transactions
under any Antitrust Law; and (v) advise the other Parties promptly of any
material communication received by such Party from any Antitrust Administrator
or any other Governmental Entity regarding any of the Transactions, and of any
understandings, undertakings or agreements (oral or written) such Party proposes
to make or enter into with any Antitrust Administrator or any other Governmental
Entity in connection with the Transactions (it being understood that the Selling
Parties shall not propose (other than to Silgan) or enter into any such
understandings, undertakings or agreements without the prior consent of Silgan).
Concurrently with the filing of notifications under any Antitrust Law or as soon
thereafter as practicable, the Selling Parties and Silgan shall each request
early termination of any applicable waiting period. Silgan shall consult
regularly with the Selling Parties in advance and from time to time regarding
(1) the conduct and status of any filings with Governmental Entities and provide
the Selling Parties with copies of such filings in sufficient time for the
Selling Parties to provide meaningful input as to strategy and content (provided
that Silgan shall be entitled to redact any of its confidential information
contained in such filings before providing copies to the Selling Parties) and
(2) any significant strategies, approaches or other actions that Silgan expects
or intends to adopt or take in connection therewith, including any
understandings, undertakings or agreements (oral or written) that Silgan
proposes to make or enter into with any Antitrust Administrator or other
Governmental Entity, and, in Silgan's reasonable discretion, shall provide the
Selling Parties with an opportunity to participate in meetings or telephone
calls with any Antitrust Administrator or any other Governmental Entity.
Section 6.4 Publicity.
---------
Neither a Selling Party nor Silgan, nor any of their respective Affiliates,
shall issue or cause the publication of any press release or other internal or
external announcement with respect to this Agreement or the Transactions without
the agreement of the other, except as may be required by Law or by any listing
agreement with a securities exchange or trading market, in which case the
disclosing Party shall make available to the other Party a copy of any such
release or announcement prior to making such disclosure.
Section 6.5 Employees; Employee Benefits.
----------------------------
(a) Silgan agrees and acknowledges, effective as of the Closing Date, to the
extent required by Law, all Employees shall continue to be employed by the
Acquired Companies or the Purchasers, as applicable, on the terms and conditions
on which they were employed immediately prior to the Closing. If not so required
by applicable Law, Silgan agrees and acknowledges that Employees will be
employed initially at a compensation level (including salary and bonus) and with
benefits that, in the aggregate, are substantially comparable to the
compensation and benefits that such Employee received immediately prior to the
Closing.
62
(b) The Parties acknowledge and agree that on Closing, in accordance with the
provisions of the ARD, the Contracts of employment of the Employees of the Asset
Sellers in connection with the Business shall transfer to the applicable
Purchaser and will have effect after Closing as if originally made between the
applicable Purchaser and such Employees. The Asset Sellers (relating to the
Business) in Europe will comply with all information and consultation
requirements, whether under the ARD or otherwise, in relation to the Employees
of the Asset Sellers being transferred to the applicable Purchaser, and their
representatives, trade unions and collective bodies.
Section 6.6 Intercompany Arrangements.
-------------------------
Except as provided in Schedule 6.6, in Section 6.10, in Section 6.16 or as
otherwise expressly contemplated by this Agreement, all Contracts relating to
the conduct of the Business that are solely between a Subject Company, on the
one hand, and the Selling Parties and any of their Affiliates (other than a
Subject Company), on the other hand, shall be terminated and of no further
effect, simultaneously with the Closing without any further action, liability or
obligation on the part of the parties thereto save in respect of any accrued
rights or obligations (including as to any payment obligations).
Section 6.7 Maintenance of Books and Records.
--------------------------------
Silgan shall preserve, until at least the eighth anniversary of the Closing
Date, all pre-Closing Date records of the Acquired Companies and/or included in
the Purchased Assets. After the Closing Date and until at least the eighth
anniversary of the Closing Date, upon any Covered Request from a Selling Party
or its Affiliate, Silgan shall (i) provide the Selling Party or its Affiliate or
their respective representatives reasonable access to such records during normal
business hours and (ii) permit a Selling Party or its Affiliate or their
respective representatives to make copies of such records, in each case at no
cost (other than for reasonable out-of-pocket expenses). For purpose of this
Section 6.7, a "Covered Request" shall mean a written request in connection with
an audit, accounting, tax, litigation, securities disclosure or other similar
need or reasonable business purpose.
Section 6.8 Cooperation in Litigation.
-------------------------
Each Party shall reasonably cooperate with the other in the defense or
prosecution of any action or proceeding already instituted or which may be
instituted hereafter by a third party against or by such Party relating to or
arising out of the conduct of the Business prior to the Closing Time (other than
an action or proceeding arising out of the Transactions).
Section 6.9 Insurance.
---------
Silgan acknowledges and agrees that effective with the Closing all insurance
coverage provided to the Subject Companies by a Selling Party or any Affiliate
of a Selling Party shall terminate (it being understood that all local insurance
of the Acquired Companies may continue after the Closing if the local insurers
concur). For greater certainty, it is agreed that all prepaid insurance with
respect to the Subject Companies shall belong to the Selling Parties and the
Acquired Companies shall pay any amount received in connection therewith to
Amcor Australia.
63
Section 6.10 Intercompany Receivables, Payables and Indebtedness.
---------------------------------------------------
(a) The Parties agree and acknowledge that any intercompany receivable or
payable balance between a Subject Company (on the one hand) and a Selling Party
or Affiliate of a Selling Party other than an Acquired Company (on the other
hand) that arose from the intercompany supply of goods or services (trading
balances) pursuant to a bona fide transaction in the ordinary course of business
and which are no more than one (1) year old shall remain outstanding as of the
Closing Date. The Parties further agree and acknowledge that such payables shall
be paid after the Closing in accordance with their terms in the currency
denominated on the applicable invoice in the ordinary course of business.
Notwithstanding the foregoing, the Selling Parties acknowledge and agree that
any intercompany receivable balance owed by Amcor PET Packaging de Venezuela SA
to Amcor Venezuela shall be paid in full prior to Closing.
(b) The Parties further agree and acknowledge that any intercompany Indebtedness
for borrowed money between an Acquired Company (on the one hand) and a Selling
Party or an Affiliate of a Selling Party, including an Acquired Company (on the
other hand) shall be paid in full prior to Closing; provided that intercompany
Indebtedness for borrowed money owed by Amcor Ukraine to Amcor UK Finance or
Amcor Shanghai to Amcor Australia shall remain outstanding and shall be repaid
at or immediately following the Closing for such Acquired Company; provided,
however, that to the extent necessary the amount of such intercompany
Indebtedness estimated at Closing for the purposes of determining the amount of
Closing Indebtedness will be reconciled with the actual amount of such
intercompany Indebtedness as finally determined by the Parties after Closing
pursuant to Section 2.5 and any outstanding balances shall be promptly settled
as therein set forth.
Section 6.11 Name Change.
-----------
(a) Silgan hereby acknowledges that it shall have no rights in the name "Amcor"
and covenants that (i) it shall not change its legal corporate name (or the name
of any of its Affiliates) to a name that includes the word "Amcor" or any
similar word that would raise a reasonable likelihood of confusion with such
term, and (ii) within ninety (90) days after the Closing Date, it shall change
the legal corporate name of each Acquired Company to a name that does not
include the word "Amcor" or any similar word that would raise a reasonable
likelihood of confusion with such term; provided that Sprint Australia and its
Affiliates shall reasonably cooperate with such Acquired Company to change its
legal corporate name. Notwithstanding the foregoing, effective as of the Closing
Date the Selling Parties hereby grant to Silgan and each Purchaser a worldwide,
royalty-free license to use the "Amcor" ▇▇▇▇ as the trademark, service ▇▇▇▇,
logo, slogan, and/or trade dress of any one or more of the Acquired Companies,
Silgan or any Purchaser in connection with the Business for the use and sell off
of only (i) products existing in inventory or on order as of the Closing Date
and packaging existing in inventory or on order in the ordinary course within
thirty (30) days after the Closing Date, and (ii) signage, advertising,
stationery, letterhead, corporate documents or any other business materials. The
license granted under this Section 6.11(a) shall be for a period of one hundred
eighty (180) days following the Closing Date. Notwithstanding the foregoing,
Silgan shall not be required to change, alter or modify the molds included in
the Purchased Assets or the assets of the Acquired Companies to remove,
permanently obliterate, cover or otherwise eliminate the word "Amcor" or any
similar word from the molds (if in fact such word(s) exist on the molds) until
Silgan changes, alters or modifies the
64
molds in the ordinary course of business. Silgan and the Purchaser shall
indemnify Amcor Australia and its Affiliates and hold them harmless from and
against any and all Losses suffered or incurred by them in connection with the
use of the "Amcor" ▇▇▇▇ on the materials described in clauses (i) and (ii) above
or on the molds. At the Closing or as soon as practicable thereafter, the
Selling Parties shall deliver to Silgan and the Purchasers the content relating
to "White Cap" of web sites of "Amcor" in order to effectuate the assignment and
transfer of such content.
(b) The Selling Parties hereby acknowledge that they shall have no rights in the
name "White Cap" and covenant that within ninety (90) days after the Closing
Date, each Selling Party and any other Affiliate of Amcor Australia (other than
the Acquired Companies) with the name "White Cap" in its legal corporate name
shall change the legal corporate name of each such Selling Party to a name that
does not include the words "White Cap" or any similar words that would raise a
reasonable likelihood of confusion with such term and change any domain names of
each such Selling Party to a name that does not include the words "White Cap" or
any similar words that would raise a reasonable likelihood of confusion with
such term; provided that Silgan and its Affiliates shall reasonably cooperate
with such Selling Party to change its legal corporate name.
Section 6.12 Reorganizations.
---------------
It is understood and agreed that Amcor Australia may cause certain
reorganizations to occur with respect to Amcor International and Amcor Singapore
which would result in the Purchased Equity owned by such companies being owned
by other Affiliates of Amcor Australia, in which case such other Affiliates
shall become Selling Shareholders hereunder and shall be treated as Selling
Shareholders for all purposes under this Agreement, including representations
and warranties, covenants and indemnities. The Selling Parties shall be entitled
to update Schedules to the extent necessary to reflect any such reorganizations,
it being understood that if the Purchasers suffer any Losses relating to such
reorganizations, the Purchasers shall be entitled to seek indemnification for
such Losses under Article X.
Section 6.13 Assignment of Contracts.
-----------------------
The assignment of any Purchased Asset (including of any Assumed Contract, Real
Property Lease, Personal Property Lease, or Governmental Permit) to be assigned
to any of the Purchasers pursuant to this Agreement shall not constitute a
Contract to assign the same to the extent that an attempted assignment without
the Consent of the other party thereto or of any Governmental Entity, as the
case may be, would constitute a breach thereof or give rise to any right of
termination, cancellation or acceleration thereunder or would violate any Law or
Governmental Permit. The Selling Parties shall use their commercially reasonable
efforts, as requested by Silgan, to procure Consents to any such assignment;
provided that the Selling Parties shall not be obligated to provide any
incentives to induce Consent to such assignment or to commence litigation to
compel Consent to such assignment. For a period of one (1) year following the
Closing Date or until any such Consent is obtained, whichever is shorter, to the
extent permitted by applicable Law, the Asset Sellers shall maintain the
existence of such Purchased Asset, shall hold such Purchased Asset in trust for
the respective Purchaser and shall cooperate with Silgan in any reasonable
arrangement designed to provide such Purchaser all of the benefits of any such
Purchased Asset, including enforcement of any and all rights of the Asset
Sellers against the
65
other party thereto arising out of the breach, cancellation or termination
thereof by such party; provided that the respective Purchaser shall assume the
liabilities of the Asset Sellers and indemnify and hold the Asset Sellers
harmless from and against any and all Losses in connection therewith (subject
and without prejudice to the Selling Parties' indemnification obligations
pursuant to Article X hereof) arising under such Purchased Asset, for the
benefit of the Asset Sellers and the other party or parties thereto.
Section 6.14 [Intentionally Omitted].
-----------------------
Section 6.15 Bulk Transfer Laws.
------------------
It is agreed that the Asset Sellers and the Selling Parties will not comply with
the provisions of any so-called bulk transfer or bulk sales Laws of any
jurisdiction in connection with the sale to the Purchasers of the Purchased
Assets; provided that Amcor Turkey shall register the sale of its Purchased
Assets to the applicable Purchaser with the Trade Registry in Turkey if the
applicable Purchaser will be purchasing the Purchased Assets of Amcor Turkey in
lieu of the Capital Stock of Amcor Turkey.
Section 6.16 Transitional Services.
---------------------
At the Closing, Amcor Australia and its applicable Affiliates shall enter into a
Transition Services Agreement with Silgan, the Purchasers and the Acquired
Companies, in form and substance mutually agreed to by the parties in good
faith, pursuant to which (i) one or more of Amcor Australia and its applicable
Affiliates will provide to Silgan, the Purchasers and the Acquired Companies
services reasonably required by Silgan, any Purchaser or any Acquired Company
substantially as provided by them to the Business prior to the Closing Date and
(ii) one or more of the Purchasers and the Acquired Companies will provide to
Amcor Australia and its applicable Affiliates services reasonably required by
Amcor Australia or its applicable Affiliates substantially as provided by the
Business prior to the Closing Date, in each case, for a period of six (6) months
from the Closing Date (it being agreed that the Parties shall negotiate in good
faith an extension of such period for any service any Party acting reasonably
has not been able to provide itself or procure from a third party), for prices
charged to or by such party as reflected in the Financial Statements as of June
30, 2005 and with the ability of the party receiving the services to terminate
such services on a service-by-service basis at any time upon ten (10) days'
notice during the term of such Transition Services Agreement.
Section 6.17 Updating Schedules.
------------------
The Selling Parties shall be entitled to update, amend or modify the Schedules
to this Agreement set forth in Article IV of this Agreement after the date
hereof to the Closing Date (the "Update Period") to reflect factors,
circumstances or events first arising or, in the case of representations and
warranties given to the Selling Parties' Knowledge, becoming known to the
Selling Parties during the Update Period by providing Silgan with written notice
setting forth the update and specifying the Schedule to be updated thereby;
provided, however, that if any such Schedules are updated, amended or modified
in a manner that discloses any matter that, individually or in the aggregate
with other such matters, has or would reasonably be expected to have a Material
Adverse Effect, Silgan may immediately terminate this Agreement pursuant to
Section 8.1(f). In
66
addition, the Selling Parties shall update, amend or modify Schedules 1.1(A),
2.2(a)(ix), 2.2(a)(xiv), 2.2(b)(xii), 2.2(b)(xiv) and 3.2(c) to this Agreement
during the Update Period to reflect only changes in such Schedules for Contracts
entered into, amended or terminated in accordance with their terms or assets
acquired or disposed of, each during the Update Period and in the ordinary
course of business and consistent with Section 6.1 hereof. To the extent any
such update pursuant to this Section 6.17 causes Silgan or an Acquired Company
to incur a Loss and Silgan does not have the right to terminate this Agreement
as hereinabove set forth, Silgan shall be entitled to seek indemnification for
such Loss in accordance with Article X. Notwithstanding anything herein to the
contrary, in the event Silgan exercises its right to terminate this Agreement as
hereinabove set forth and the update, amendment or modification giving rise to
such termination relates to facts, circumstances or events first arising during
the Update Period, the Selling Parties shall have no liability for any Loss.
Section 6.18 Third-Party Indebtedness; Releases.
----------------------------------
(a) The Selling Parties agree and acknowledge that any third-party Indebtedness
for borrowed money between an Acquired Company (other than Amcor Shanghai, Amcor
Ukraine, Amcor Polska, Amcor Venezuela, Amcor South East Asia and Amcor Asia
Pacific) and a third party shall be paid in full prior to Closing.
(b) Within thirty (30) days after the Closing Date, in respect of the
Indebtedness of Amcor Shanghai, Amcor Ukraine, Amcor Polska, Amcor South East
Asia and Amcor Asia Pacific outstanding as of the Closing Date, the respective
Acquired Company shall either (i) repay all amounts due under such Indebtedness
or (ii) in respect of Indebtedness not repaid, deliver to Amcor Australia a
release and discharge from the lender, in form and substance reasonably
satisfactory to Amcor Australia, in respect of such Indebtedness.
(c) In respect of the guarantees to third parties set forth on Schedule 6.18,
Silgan shall use commercially reasonable efforts to deliver to Amcor Australia
releases under such guarantees.
Section 6.19 Notice of Developments.
----------------------
Prior to the Closing Date, each of the Selling Parties and Silgan, as
applicable, shall promptly notify the other of:
(a) any notice or other communication such Party receives from any Person
alleging that the consent of such Person is or may be required in connection
with the transactions contemplated by this Agreement or the Ancillary
Agreements; and
(b) any change that could delay or impede the ability of either the Selling
Parties or Silgan to perform their respective obligations under this Agreement
and the Ancillary Agreements and to consummate the transactions contemplated
hereby and thereby; and
(c) in the case of the Selling Parties, any change that has had or could
reasonably be expected to have a Material Adverse Effect.
67
Section 6.20 Exclusivity.
-----------
From the date hereof through the earlier of the Closing Date or the earlier
termination of this Agreement in accordance with Article VIII, the Selling
Parties shall not, and shall direct each of their Affiliates not to, directly or
indirectly:
(a) sell or agree to sell to any other Person, or solicit or accept any offer to
purchase from any other Person, or negotiate with any other Person for the sale
of, any of the Business or the Acquired Companies, whether such transaction
takes the form of a sale of stock, the sale of an option to acquire stock either
directly or indirectly through purchase of a derivative security, merger,
consolidation, sale of assets or otherwise;
(b) provide any information to any other Person concerning the same (other than
information which the Selling Parties and/or its shareholders provide to other
Persons in the ordinary course of business consistent with past practice); or
(c) enter into or continue any discussions with any other Person in connection
with (a) or (b) above.
Section 6.21 Audited Financial Statements.
----------------------------
The Selling Parties shall use their commercially reasonable efforts to cause to
be prepared and delivered to Silgan within sixty (60) days from the date hereof,
at Silgan's cost, (i) the audited consolidated balance sheet of the Subject
Companies as at June 30, 2005; (ii) the audited consolidated statements of
profit and loss of the Subject Companies for the twelve-month period ended June
30, 2005; and (iii) the audited consolidated statement of cash flow of the
Subject Companies for the twelve-month period ended June 30, 2005, all prepared
in accordance with IFRS applied on a consistent basis (collectively, the
"Audited Financial Statements"); provided, however, that as regards the Asset
Sellers, the Audited Financial Statements include only such financial
information as is applicable to the Business and not to any other business or
activities carried on by any such Asset Seller, and that for the purposes of the
definition of Audited Financial Statements, "Subject Companies" does not include
Amcor Australia. If the Audited Financial Statements are not delivered within
the time period specified above, the Selling Parties shall cause their auditors
to deliver to Silgan at least thirty (30) days prior to Closing the current
draft of such Audited Financial Statement and a reasonably detailed list of the
remaining open items in such draft Audited Financial Statements. These audited
financial statements shall be audited by Amcor's current auditor. The Selling
Parties represent and warrant that the Audited Financial Statements will be
prepared from the books and records of the Subject Companies, will be prepared
in accordance with IFRS applied on a basis consistent with the books and records
of the Business, and will fairly present in all material respects the
consolidated financial position and the consolidated results of operations and
cash flows of the Subject Companies, as of the times and for the periods
referred to therein. The Audited Financial Statements shall include a footnote
setting forth a reconciliation from IFRS to United States generally accepted
accounting principles. The audit is to be conducted at an appropriate
materiality level calculated by Amcor's current auditor based on the Acquired
Companies and the Asset Sellers (to the extent related to the Business) being a
stand alone entity. It is acknowledged that because the Audited Financial
Statements are being prepared with a different
68
materiality level and with a different knowledge base (only because of the
passage of time as it relates to the transpiring of events or changes in
circumstances) than were the Individual Statements described in clauses (i) -
(iii) of the definition of Financial Statements (collectively, the "June 30,
2005 Financial Statements"), there may be differences between the Audited
Financial Statements and the June 30, 2005 Financial Statements. Furthermore, it
is agreed that any difference between the Audited Financial Statements and the
June 30, 2005 Financial Statements because of the reasons described in the
foregoing sentence shall not, in and of itself, form the basis for a claim that
there was a breach of the representation and warranty set forth in Section
4.8(a) or this Section 6.21.
Section 6.22 Collection of Receivables.
-------------------------
For the one hundred eighty (180) day period after the Closing Date, the
respective Purchasers and Acquired Companies will collect the Receivables in
accordance with reasonably prudent business practices (but without resort to
actual or threatened litigation or the use of collection agencies or similar
efforts). One hundred eighty (180) days after the Closing Date (such date
referred to as the "Repurchase Date"), Silgan shall present to the Selling
Parties a list of the unpaid Receivables at the end of such one hundred eighty
(180) day period (the "Uncollected Receivables"). Promptly after receipt and
verification of such list, Silgan shall inform the Selling Parties which
Uncollected Receivables Silgan, in its sole discretion, elects to transfer to
the Selling Parties (or one or more Persons as designated by the Selling Parties
(their "Designees")). The respective Purchaser or Acquired Company shall
transfer to the Selling Parties (or their Designees) such Uncollected
Receivables and all remaining records pertaining thereto. Any such Uncollected
Receivables not transferred to the Selling Parties (or their Designees) shall be
deemed retained by the respective Purchaser or Acquired Company and Silgan will
have no claims with respect to such Uncollected Receivables against any Selling
Party to the extent not collected (the "Retained Receivables"). The Selling
Parties (or their Designees) shall thereafter be entitled to collect the
Uncollected Receivables to the extent transferred to the Selling Parties (or
their Designees) for their own account. The respective Purchaser or Acquired
Company shall promptly pay to the Selling Parties the amount, if any, by which
the amount of the Uncollected Receivables transferred to the Selling Parties (or
their Designees) is less than the difference between the aggregate reserve for
the Receivables on the Closing Statement less the reserve relating to the
Retained Receivables. The Selling Parties (or their Designees) shall promptly
pay to the respective Purchaser or Acquired Company the amount, if any, by which
the amount of the Uncollected Receivables transferred to the Selling Parties (or
their Designees) exceeds the difference between the aggregate reserve for the
Receivables on the Closing Statement less the reserve relating to the Retained
Receivables. The Party making any payment under this Section 6.22 shall make it
in Euros and the amount of all such Uncollected Receivables shall be calculated
by using the Exchange Rate as of the Closing Date. Each Party shall apply each
payment for an Uncollected Receivable received by such Party to the reduction of
the applicable customer's outstanding balance by first applying such payment to
the oldest invoice (unless such payment specifically identifies the invoice
being paid, in which case such payment shall be applied to such specific
invoice, and provided that payments shall not be applied against an invoice that
is the specific subject of a bona fide dispute by the customer until such
dispute is resolved). For example, if the amount of the Uncollected Receivables
is (euro)100,000, the aggregate reserve for the Receivables on the Closing
Statement is (euro)50,000, the receivable for a certain customer that the
applicable Purchaser or Acquired Company has not transferred to the
69
applicable Selling Party (or its Designee) is (euro)20,000, and the reserve for
the receivables on the Closing Statement relating to such customer is
(euro)20,000, then the applicable Purchaser or Acquired Company shall transfer
(euro)80,000 in Uncollected Receivables to the applicable Selling Party or its
Designees and the Selling Parties shall promptly pay to the respective Purchaser
or Acquired Company (euro)50,000.
Section 6.23 Rework and Refunds.
------------------
As of the Closing Date, the Purchasers shall assume and thereafter discharge all
responsibilities, liabilities and obligations of the Asset Sellers for Rework
and Refunds arising out of products manufactured by the Asset Sellers prior to
the Closing Date (the "Asset Sellers' Pre-Closing Products") and the Acquired
Companies shall discharge all of their responsibilities, liabilities and
obligations for Rework and Refunds arising out of products manufactured by them
prior to the Closing Date (collectively, together with the Asset Sellers'
Pre-Closing Products, the "Pre-Closing Products"); provided, however, that Amcor
Australia agrees to pay to Silgan the excess of (i) the value for all Rework and
the amount of all Refunds incurred by the Acquired Companies and the Purchasers
with respect to the Pre-Closing Products over (ii) the aggregate amount for
"Product Warranties" and "Product Warranties without Legal Obligations" set
forth on Schedule 1.1(B). Amcor Australia shall make payment in Euros, and the
value for such Rework and the amount of such Refunds shall be calculated by
using the Exchange Rate as of the date the Refund is paid to the customer or the
Rework is delivered to the customer. The issuance by the Purchasers or the
Acquired Companies of credit memos, customer accommodations or similar items for
any Rework or Refund and the payment by the Purchasers or the Acquired Companies
of any Refund shall be made in accordance with reasonably prudent business
practices and without consideration of the Selling Parties' obligations
hereunder. Amcor Australia shall have approval rights with respect to any Refund
or Rework together with all related Refunds or Reworks, exceeding (euro)62,500,
such approval not to be unreasonably withheld, conditioned or delayed; provided
that to the extent that Amcor Australia is responsible for aggregate payments in
excess of (euro)1.5 million pursuant to this Section 6.23, Amcor Australia shall
have approval rights with respect to any Rework or Refund together with all
related Refunds or Reworks, over (euro)25,000, such approval not to be
unreasonably withheld, conditioned or delayed. In approving such Refund or
Rework, Amcor Australia shall act reasonably in a manner consistent with its
past practice in connection with Refunds or Reworks. If Amcor Australia does not
object to any such Refund or Rework within ten (10) Business Days after being
notified about any proposed Refund or Rework, it shall be deemed to have
irrevocably approved such Refund or Rework. Within thirty (30) days following
the end of each calendar month following the Closing Date, Silgan shall deliver
to Amcor Australia written notice (the "Payment Notice") of the amount of Rework
and Refunds that the Purchasers and the Acquired Companies incurred on and prior
to the end of each such month. During the thirty (30) day period following its
receipt of each Payment Notice, Amcor Australia shall be entitled to have
reasonable access to the books and records of the Acquired Companies and the
Purchasers with respect to Reworks and Refunds, to reasonably request copies of
supporting documents for the purpose of verifying the amounts of Reworks and
Refunds and, with reasonable prior notice to Silgan, to conduct an audit for
reasonable verification of the Reworks and Refunds if it deems it necessary. The
amount due hereunder by Amcor Australia to Silgan shall be paid to Silgan within
thirty (30) days following Amcor Australia's receipt of each Payment Notice,
unless such amount is being contested in good faith by Amcor Australia. All
amounts due from Amcor
70
Australia to Silgan under this Section 6.23 shall be reduced from time to time
by the salvage value or other value, if any, recovered by the Purchasers or the
Acquired Companies, consistent with past practices of the applicable Subject
Company, from any Pre-Closing Products with respect to which Rework or Refunds
are provided hereunder. The Selling Parties shall have no liability for Reworks
or Refunds except as provided in this Section 6.23. Notwithstanding the
foregoing, this Section 6.23 shall not cover any other claims relating to
products which are covered by Section 10.2(e).
Section 6.24 German Lease.
------------
Amcor Australia and Amcor Deutschland shall use their commercially reasonable
efforts to enter into the New German Lease as set forth in Section 7.2(a).
Section 6.25 Newco Italy Contribution.
------------------------
No later than five (5) days prior to Closing, Amcor Italy shall have effected
the Newco Italy Contribution at fair market value in accordance with applicable
Laws.
Section 6.26 Philippine Share Transfer.
-------------------------
At the request of Silgan, Amcor Australia shall cause all right and title to the
qualifying shares, if any, held by the directors of Amcor South East Asia, Amcor
Asia Pacific, Amcor Investments and Amcor Properties, at the closing for such
Acquired Companies, as requested by Silgan, to be transferred and conveyed to a
Person designated by Silgan, free and clear of all Encumbrances.
Section 6.27 Cerebos Supply Agreement.
------------------------
As promptly as practicable, the Selling Parties shall use their commercially
reasonable efforts to enter into an amendment to the Cerebos Agreement
containing the terms and conditions set forth on Annex B. Silgan shall
reasonably cooperate with the Selling Parties in connection therewith, including
by meeting with Cerebos and providing such information to Cerebos as Cerebos may
reasonably request.
Section 6.28 Venezuela.
---------
As soon as practicable, the Selling Parties shall dispose of all
asbestos-containing materials stored during the period Amcor Venezuela is owned
by the applicable Selling Party on the grounds of the Amcor Venezuela
manufacturing plant located in Valencua - Edo. Carabobo, Venezuela in compliance
with all applicable Laws and reasonably satisfactory to Silgan. Silgan shall
reasonably cooperate with the Selling Parties in connection therewith, including
by taking all reasonable steps to ensure that storage and containment procedures
implemented by the Selling Parties are not disturbed or tampered with and by
giving the Selling Parties reasonable access to the asbestos containing material
to check and maintain the storage and containment thereof and to effect the
disposal of the asbestos containing materials. As soon as practicable, the
Selling Parties shall use its commercially reasonable efforts to cause all Book
Cash Balances of Amcor Venezuela as of the close of business, local time for
Amcor Venezuela, on the day immediately prior to the Closing Date to be
distributed out of such company; provided such
71
distributions or payments are net of any Taxes payable by Amcor Venezuela with
respect thereto.
ARTICLE VII
CONDITIONS TO CLOSING
Section 7.1 Conditions to Each Party's Obligation to Effect the Closing.
-----------------------------------------------------------
The respective obligation of each of the Parties to effect the Closing shall be
subject to the satisfaction on the Closing Date of each of the following
conditions:
(a) Laws; Court Orders. No Law shall have been enacted or promulgated by any
Governmental Entity that prohibits the consummation of the Transactions and
there shall be no order or judgment in effect prohibiting consummation of the
Transactions; provided, however, that the Parties shall use their commercially
reasonable efforts to have any such order or judgment vacated or lifted.
(b) Antitrust Approval. Any Consents of or actions (or inactions) by any
Antitrust Administrator or the expiry of any applicable waiting periods as set
forth on Schedule 7.1(b) shall have been obtained.
(c) Purchase Price Allocation. The Purchase Price Allocation shall have been
mutually agreed to by the Parties in good faith.
(d) Consultation. This Agreement is subject to the required regulatory approvals
and the appropriate information of and/or consultation with employee
representatives.
Section 7.2 Conditions to Obligations of Silgan to Effect the Closing.
---------------------------------------------------------
The obligation of Silgan to effect the Closing shall be subject to the
satisfaction on the Closing Date of each of the following conditions:
(a) Representations and Warranties. All of the representations and warranties of
the Selling Parties set forth in this Agreement shall be true and correct when
made and on and as of the Closing Date or if made as of a specified date, only
as of such date, except where the failure to be true and correct would not
reasonably be expected to have a Material Adverse Effect.
(b) Breach by the Selling Parties. No Selling Party shall have failed to perform
any obligation or to comply with any covenant or agreement to be performed or
complied with by it under this Agreement, except where the failure to perform or
comply would not reasonably be expected to have a Material Adverse Effect.
(c) Deliveries by Selling Parties. The Selling Parties shall have delivered to
Silgan those items required by Section 3.2.
(d) German Lease. The Business shall have the legal right to operate as it is
currently conducted and conducted as of the Closing Date on the site located at
▇▇▇▇▇▇▇▇▇▇▇▇ ▇, ▇-▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇, on terms and conditions
substantially similar to the terms and conditions of occupancy
72
set forth in the Lease Agreement, dated December 16, 1987, between LAMELLA
Grundstucks-Vermietungsgesellschaft mbH, Dusseldorf, and ▇▇▇▇▇▇▇▇▇▇-Lubeca AG,
Braunschweig (the "Current German Lease") for a period of at least ten (10)
years from the date hereof and an option to purchase the property located at
▇▇▇▇▇▇▇▇▇▇▇▇ ▇, ▇-▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ (at the end of the term of such ten
(10) year period) at fair market value (the "New German Lease").
(e) Material Adverse Effect. During the period from the date hereof to the
Closing Date, there shall not have occurred any change, development or event
that would reasonably be expected to have a Material Adverse Effect.
(f) Newco Italy Contribution. Amcor Italy shall have effected the Newco Italy
Contribution pursuant to Section 6.25.
(g) Audited Financial Statements. No later than twenty (20) days prior to
Closing, Silgan shall have received the Audited Financial Statements.
(h) Counterpart Agreements. Amcor Australia shall have caused each of the
Selling Parties to deliver to Silgan duly executed counter-parts to this
Agreement.
Section 7.3 Conditions to Obligations of the Selling Parties to Effect the
--------------------------------------------------------------
Closing.
-------
The obligation of the Selling Parties to effect the Closing shall be subject to
the satisfaction on the Closing Date of each of the following conditions:
(a) Representations and Warranties. All of the representations and warranties of
Silgan set forth in this Agreement shall be true and correct in all material
respects when made and on and as of the Closing Date if made as of a specified
date, only as of such date, except where the failure to be true and correct
would not reasonably be expected to have a material adverse effect on Silgan or
the Purchasers, taken as a whole, or on their ability to consummate the
Transactions.
(b) Breach by Silgan. Silgan shall not have failed to perform any obligation or
to comply with any covenant or agreement to be performed or complied with by it
under this Agreement, except where the failure to perform or comply would not
reasonably be expected to have a material adverse effect on Silgan or the
Purchasers, taken as a whole, or on their ability to consummate the
Transactions.
(c) Deliveries by Silgan. Silgan shall have delivered to the Selling Parties
those items required by Section 3.3.
ARTICLE VIII
TERMINATION
Section 8.1 Termination.
-----------
This Agreement may be terminated at any time prior to the Closing Date:
(a) by the mutual written consent of Silgan and the Selling Parties;
73
(b) by Silgan or the Selling Parties if any Governmental Entity issues an order
or takes any other action (which order or other action the Parties shall use
their commercially reasonable efforts to lift) that permanently restrains,
enjoins or otherwise prohibits the consummation of the Transactions and such
order or other action shall have become final and non-appealable;
(c) by either Silgan or the Selling Parties if the Closing does not occur on or
prior to July 31, 2006, and such Party is not in material breach of this
Agreement at the time such Party terminates this Agreement;
(d) by the Selling Parties if Silgan breaches any of its representations,
warranties, covenants or other agreements contained in this Agreement that would
give rise to the failure of a condition set forth in Article VII, which breach
cannot be or has not been cured within thirty (30) days after the giving of
written notice by the Selling Parties to Silgan specifying such breach;
(e) by Silgan if a Selling Party breaches any of its representations,
warranties, covenants or other agreements contained in this Agreement that would
give rise to the failure of a condition set forth in Article VII, which breach
cannot be or has not been cured within thirty (30) days after the giving of
written notice by Silgan to the Selling Parties specifying such breach; or
(f) by Silgan pursuant to Section 6.17.
Section 8.2 Effect of Termination.
---------------------
If this Agreement is terminated by any Party pursuant to the terms hereof, this
Agreement shall forthwith terminate and have no further force and effect, except
that (a) the covenants and agreements set forth in Section 6.4, Section 6.14,
this Section 8.2 and Section 11.1 shall survive such termination indefinitely
and (b) nothing in this Section 8.2 shall be deemed to release any Party from
any liability for any breach by such Party of the terms of this Agreement or to
impair the right of any Party to compel specific performance by another Party of
its obligations under this Agreement which have arisen prior to the date of
termination of this Agreement.
ARTICLE IX
TAX MATTERS
Section 9.1 Taxes of the Acquired Companies.
-------------------------------
(a) Tax Returns. The Selling Parties shall prepare all Tax Returns of the
Acquired Companies for all taxable periods that end on or prior to the Closing
Date. The Selling Parties shall deliver to Silgan any such Tax Returns that are
required to be filed after the Closing Date no later than five (5) days prior to
the due dates thereof (taking into account any extensions) and Silgan promptly
shall file, in no case later than the applicable due dates, such Tax Returns
with the applicable taxing authorities. Silgan shall prepare, or cause to be
prepared, and shall file, or cause to be filed, all other Tax Returns of the
Acquired Companies.
(b) Selling Parties' Obligations. The Selling Parties, jointly and severally,
shall be responsible for and timely pay and shall indemnify and hold harmless
Silgan, the Purchasers and the Acquired Companies with respect to, without
duplication, (i) any and all Taxes imposed on the
74
Acquired Companies, or for which the Acquired Companies are liable, with respect
to any periods ending on or before the Closing Date, other than Taxes imposed
with respect to the Closing Date, or to the extent apportioned pursuant to
Section 9.1(d), (ii) all Taxes with respect to any period ending on or before
the Closing Date arising out of a breach of the representations and warranties
or covenants contained in Section 4.18, (iii) any and all Taxes resulting from
any transactions of the Acquired Companies occurring on or after the Closing
Time but before the occurrence of the Closing that are not in the ordinary
course of business, and (iv) any reasonable costs or expenses with respect to
Taxes indemnified hereunder. The Selling Parties shall be entitled to any refund
of any and all Taxes that are the Selling Parties' responsibility pursuant to
the immediately preceding sentence. Any indemnity payment required to be made by
the Selling Parties pursuant to this Section 9.1(b) shall be made within thirty
(30) days of written notice from Silgan. Notwithstanding anything else herein to
the contrary, the Selling Parties shall be solely responsible for all income or
capital gain Taxes with respect to the sale of the Purchased Assets and the
Purchased Equity to the Purchasers pursuant to this Agreement.
(c) Silgan's Obligations.
(i) Except as otherwise provided in Section 9.1(b), on and after the
Closing Date, Silgan, the Purchasers and the Acquired Companies shall be solely
responsible for the payment or discharge of all Taxes imposed on the Acquired
Companies for (A) all periods ending after the Closing Date, and any Taxes
imposed with respect to the Closing Date, including all Taxes related to
deferred Tax liabilities of the Acquired Companies to the extent they would have
been required to have been included on a balance sheet of the Business under
IFRS consistently applied and (B) any costs or expenses with respect to Taxes
indemnified hereunder. Silgan shall indemnify, defend and hold the Selling
Parties and their Affiliates harmless from, and shall be entitled to any refund
of, any and all Taxes that are Silgan's, the Acquired Companies' or the
Purchasers' responsibility pursuant to the immediately preceding sentence.
(ii) Silgan agrees not to take any action that would increase the Tax
liability of Amcor International as a result of Amcor Venezuela being classified
as a "controlled foreign corporation" for U.S. federal income tax purposes,
including any transaction outside the ordinary course of business that would
result in additional inclusions of subpart F income by Amcor International for
the taxable year that includes the Closing Date, or causing Amcor Venezuela to
make a distribution to Silgan in such taxable year. Silgan agrees to indemnify
Amcor International for any Taxes or costs or expenses relating to such Taxes as
a result of any breach of this Section 9.2(c)(ii).
(iii) Any indemnity payment required to be made by Silgan pursuant to this
Section 9.1(c) shall be made within thirty (30) days of written notice from the
Selling Parties.
(d) Apportionment. For the sole purpose of appropriately apportioning any Taxes
relating to a period that includes (but that would not end prior to) the Closing
Date, if the Selling Parties so request and applicable Law so permits, Silgan
will elect with the relevant taxing authority to treat for all purposes the day
preceding the Closing Date as the last day of a taxable period of the Acquired
Companies. In the case where applicable Law does not permit the Acquired
Companies to treat the day preceding the Closing Date as the last day of a
taxable period, or the Selling Parties do not request that such an election be
made, then for purposes of this Agreement,
75
the portion of such Tax that is attributable to the Acquired Companies for the
part of such taxable period that ends on the day preceding the Closing Date
shall be (i) in the case of a Tax that is not based on net income, the total
amount of such Tax for the full taxable period up to the Closing Date multiplied
by a fraction, the numerator of which is the number of days from the beginning
of such taxable period up to the Closing Date and the denominator of which is
the total number of days in such full taxable period, and (ii) in the case of a
Tax that is based on net income, the Tax that would be due with respect to such
partial period, if such partial period were a full taxable period, apportioning
income, gain, expenses, loss, deductions and credits equitably based on an
interim closing of the books. The benefits of lower tax brackets and other
similar benefits shall be apportioned in making the calculation of such
allocated portions on the basis of the number of days in Silgan's and the
Selling Parties' holding periods for the taxable period beginning before and
ending after the Closing Date.
Section 9.2 Contests.
--------
For purposes of this Agreement, a "Contest" is any audit, court proceeding or
other dispute with respect to any Tax matter that affects the Acquired
Companies. Unless Silgan previously has received written notice from the Selling
Parties of the existence of such Contest, Silgan shall give written notice to
the Selling Parties of the existence of any Contest relating to a Tax matter
that is the Selling Parties' responsibility under Section 9.1(b) within ten (10)
Business Days from the receipt by Silgan of any written notice of such Contest.
Unless the Selling Parties previously have received written notice from Silgan
of the existence of such Contest, the Selling Parties shall give written notice
to Silgan of the existence of any Contest for which Silgan has responsibility
within ten (10) Business Days from the receipt by the Selling Parties of any
written notice of such Contest. Silgan, on the one hand, and the Selling
Parties, on the other, agree, in each case at no cost to the other Party, to
cooperate with the other and the other's representatives in a prompt and timely
manner in connection with any Contest. Such cooperation shall include, but not
be limited to, making available to the other Party, during normal business
hours, all books, records, returns, documents, files, other information
(including working papers and Schedules), officers or employees (without
substantial interruption of employment) or other relevant information necessary
or useful in connection with any Contest requiring any such books, records and
files. The Selling Parties shall, at their election, have the right to represent
the Acquired Companies' interests in any Contest relating to a Tax matter
arising in a period ending on or before the Closing Date, to employ counsel of
their choice and to control the conduct of such Contest, including settlement or
other disposition thereof; provided, however, that Silgan, at its own expense,
shall have the right to consult with the Selling Parties regarding any such
Contest that may affect the Acquired Companies for any periods ending after the
Closing Date. Silgan shall have the right to control the conduct of any Contest
with respect to any Tax matter arising in a period ending after the Closing
Date; provided, however, that the Selling Parties, at their own expense, shall
have the right to consult with Silgan regarding any such Contest that may affect
the Acquired Companies for any periods ending on or before the Closing Date; and
provided further that any settlement or other disposition of any such Contest
may only be with the consent of the Selling Parties, which consent shall not be
unreasonably withheld, conditioned or delayed; and provided further that any
settlement or other disposition of any such Contest that affects both the
Selling Parties and the Purchaser (i.e., affects taxable periods both before and
after the Closing Date) may only be with the consent of both Parties.
76
Section 9.3 Price Adjustment.
----------------
All amounts paid pursuant to this Agreement by one Party to another Party (other
than interest payments) shall be treated by such Parties as an adjustment to the
Purchase Price, to the extent permitted by Law.
Section 9.4 Exclusive Remedy.
----------------
In the event of any conflict between the provisions of this Article IX and any
other provisions of this Agreement, this Article IX shall prevail with respect
to any claim for indemnification for Taxes.
ARTICLE X
SURVIVAL AND REMEDIES
Section 10.1 Survival.
--------
Subject to Section 10.9, the representations, warranties, covenants and
agreements contained in this Agreement shall survive the Closing.
Section 10.2 Indemnification by Selling Parties.
----------------------------------
Subject to the other provisions of this Article X, the Selling Parties, jointly
and severally, shall indemnify and hold harmless and defend any Silgan
Indemnitee from and against any and all Losses without duplication suffered or
incurred by any Silgan Indemnitee after the Closing as a result of, arising out
of, relating to or in connection with:
(a) any breach by the Selling Parties, or any inaccuracy, of any representation
or warranty of the Selling Parties contained in this Agreement or any Ancillary
Agreement (except for Section 4.15 for which any breach is governed by Section
10.3); provided that for purposes of this Section 10.2(a), the representations
and warranties in Sections 4.4, 4.16 and 4.20(h) subject to "materiality" or
"Material Adverse Effect" qualifiers shall be read as if made without such
"materiality" or "Material Adverse Effect" qualifiers;
(b) the failure by a Selling Party to perform any covenant or agreement of such
Selling Party under this Agreement or any Ancillary Agreement;
(c) any Excluded Liabilities;
(d) any default described in Schedule 4.12(b) under (A) the Cerebos Agreement
and (B) the supply agreement with Bledina dated May 15, 2003;
(e) except for liabilities for Rework and Refunds covered by Section 6.23
hereof, any product, part, component or other item manufactured by the Subject
Companies prior to the Closing Date;
(f) notwithstanding any other provision of this Agreement, including Section
10.7(c) hereof, or whether such liability or obligation is an Excluded Liability
or an Acquired Company Excluded Liability, any liability or obligation (whether
known or unknown, absolute, accrued, contingent
77
or otherwise and whether contractual, tort or any other type of liability,
obligation or claim) relating to or arising from any facility that any Subject
Company or Selling Party or their present or former subsidiaries or respective
predecessors in interest may have owned, leased, operated or otherwise used at
any time that is not included in the Real Property or the operation of any
business other than the Business at any of the Real Property, including any such
liabilities or obligations resulting from the generation, use, handling,
presence, treatment, storage, transportation, disposal or Release of any
Hazardous Materials at any such facility or any violations of applicable
Environmental Laws on, prior to or after the Closing Date;
(g) any Acquired Company Excluded Liabilities;
(h) any Taxes due as a result of the fact that the interest payable on the
Indebtedness of the Acquired Companies outstanding as of the Closing Date is not
tax deductible in the applicable jurisdiction because of inadequate historical
documentation or the applicability of thin capitalization rules prior to the
Closing;
(i) the obligations of Amcor Deutschland as a result of, arising out of,
relating to or in connection with the Cerebos Agreement (i) until such time as
the purchase and sale of Amcor South East Asia, Amcor Investments, Amcor
Properties and Amcor Asia Pacific is consummated pursuant to Section 3.4
(whether or not the business of such Specified Interest is being managed by
Silgan or any of its Affiliates or the applicable Selling Party) or (ii) in
perpetuity in the event the Specified Approval for the sale of Amcor South East
Asia, Amcor Investments, Amcor Properties and Amcor Asia Pacific is not obtained
and the Parties do not close the purchase and sale of such Specified Interests
in accordance with this Section 3.4;
(j) the disposal of any asbestos-containing materials stored at Closing on the
grounds of the Amcor Venezuela manufacturing plant located in Valencua - Edo.
Carabobo, Venezuela;
(k) (A) any debt arising under United Kingdom legislation due to the operation
of section 75 or section 75A of the Pensions Act 1995 giving rise to any
relevant demand or costs, (B) any Losses to contribute or to provide support
which are levied, imposed or incurred pursuant to United Kingdom legislation
under sections 38 to 51 of the Pensions ▇▇▇ ▇▇▇▇ and (C) any funding deficit in
excess of (euro)720,000 that is attributable to any Seller Benefit Plan designed
to benefit the individual set forth on Schedule 10.2(k);
(l) [intentionally omitted];
(m) the Brazil Litigation, including the loss of any management fees under the
applicable Specified Interest Management Agreement; and
(n) any and all actions, suits, proceedings, claims or demands incident to any
of the foregoing or initiated to enforce the indemnification provisions herein.
Section 10.3 Environmental Health and Safety Indemnity.
-----------------------------------------
(a) Subject to the terms and conditions set forth in this Section 10.3, from and
after the Closing, the Selling Parties shall indemnify and hold harmless each
Silgan Indemnitee from and against all Losses asserted against or incurred by
such Silgan Indemnitee as a result of, arising out of,
78
relating to or in connection with any one or more of the following, whether or
not disclosed at or before the time of Closing:
(i) any Environmental Claims and the investigation, remediation or
correction of Environmental Conditions caused by, relating to or arising out of
(1) any conditions prior to the Closing Date at properties currently or
previously owned, leased or operated by any Selling Party, any Subject Company,
their present or former subsidiaries or respective predecessors in interest, (2)
the operations prior to the Closing Date of any Selling Party, any Subject
Company, their present or former subsidiaries or respective predecessors in
interest, including arising out of the disposal, Release or threatened Release
of any Hazardous Substance owned, controlled or possessed by any Selling Party,
any Subject Company, their present or former subsidiaries or respective
predecessors in interest, and (3) the Excluded Assets, Excluded Liabilities and
Acquired Company Excluded Liabilities;
(ii) any failure of the Subject Companies to comply with Environmental Laws
prior to the Closing, including the installation of any pollution control
equipment or other equipment to bring the Business into compliance with
Environmental Law if such equipment is installed because the Business was not in
compliance with any Environmental Laws as of the Closing Date;
(iii) any liability, obligation, or legal responsibility arising under
Environmental Laws assumed by any Subject Company prior to the Closing Date
pursuant to the terms of any Contract, settlement or other written and legally
binding arrangement between such Subject Company and any other Person; and
(iv) any breach of a representation and warranty set out in Section 4.15
hereof when made or as of the Closing as though such representation and warranty
was made at and as of Closing.
(b) Notwithstanding anything herein, in the Law or otherwise to the contrary, no
claim or cause of action with respect to the operation of the Business at the
Real Property, including any Release of any Hazardous Substances in connection
therewith, may be brought by any Silgan Indemnitee against the Selling Parties
under this Section 10.3 after the fifth (5th) anniversary of the Closing Date.
All other claims arising under this Section 10.3 may be brought in perpetuity.
(c) The Selling Parties will, at their option, fully satisfy their indemnity
obligations with respect to any claim under this Section 10.3 other than a Third
Party Claim, either by compensating the Silgan Indemnitees for the Loss or,
after the Selling Parties acknowledge their obligation to fully indemnify the
Silgan Indemnitees, by remediating the breach that is the subject of such claim
for indemnification. If the Selling Parties do not acknowledge their obligation
to fully indemnify the Silgan Indemnitees pursuant hereto within thirty (30)
days or such shorter period as required by any applicable Governmental Entity,
then Silgan shall remediate the breach that is the subject of such claim for
indemnification and the Selling Parties shall compensate the Silgan Indemnitees
pursuant to their obligations set forth in this Section 10.3.
(d) Except as otherwise required by any Governmental Entity or by applicable
Law, in no event shall Losses include liabilities, damages, costs or expenses
associated with remediation or
79
cleanup to levels or standards applicable to other than industrial property use,
except for such portion of a facility currently used for commercial purposes
(e.g., office or rent), in which case remediation to cleanup levels or standards
applicable to commercial use for the portion of the facility used for commercial
purposes shall be appropriate.
(e) The Selling Parties shall be obligated to remediate any breach with respect
to a claim under this Section 10.3 subject to the satisfaction of the following
conditions:
(i) on becoming aware of any fact or circumstance that could reasonably be
expected to give rise to a claim under this Section 10.3, the Silgan Indemnitees
shall give written notice thereof to the Selling Parties;
(ii) the Silgan Indemnitees shall arrange for the Selling Parties and their
authorized employees, agents, representatives, consultants, contractors and
subcontractors to have all necessary or desirable rights to enter the applicable
Real Property to remediate such breach pursuant to Section 10.3(c) above and on
terms satisfactory to the Silgan Indemnitees and the Selling Parties, acting
reasonably. The Selling Parties shall consult with the Silgan Indemnitees in all
material aspects of remediation. The Selling Parties shall undertake remediation
in a prompt and expeditious fashion in accordance with applicable Laws. Any
remediation to be carried out by the Selling Parties shall be set forth in a
work plan and be subject to the prior written approval of the Silgan
Indemnitees, acting reasonably. The Selling Parties shall provide copies to the
Silgan Indemnitees of all written notices, final submissions, final work plans,
and final reports and shall give the Silgan Indemnitees a reasonable opportunity
(at the Silgan Indemnitees own expense) to comment on any submissions the
Selling Parties intend to deliver or submit to the appropriate Governmental
Entity prior to said submission; and
(iii) the Selling Parties performance of any remedial action pursuant to
this Section 10.3 shall be deemed complete (A) upon receipt of notice from the
relevant Governmental Entity that no further action is required to be conducted
(a "Governmental Sign-Off") or (B) where allowed by applicable Environmental
Law, a certification from a licensed environmental professional or its
equivalent that no further action is necessary under applicable Environmental
Laws (unless within the time specified by applicable Law the relevant
Governmental Entity determines that further action is required); or (C) if no
Government Entity has asserted jurisdiction or for any other reason Governmental
Sign-Off is not obtainable, when the Silgan Indemnitees' environmental
consultant (acceptable to the Selling Parties, acting reasonably) agrees that
remedial action has been completed in accordance with applicable standards. In
the event that Silgan Indemnitees' environmental consultant does not agree with
the Selling Parties' environmental consultant as to the completion of the
remedial action, the Silgan Indemnitees and the Selling Parties (both acting
reasonably) shall jointly retain an environmental consultant (acceptable to both
Parties) to determine whether the remedial action has been completed and the
decision of that environmental consultant shall be accepted by the Parties as
final.
(f) With respect to any notice, approval, disclosure, letter, action,
remediation, clean-up or study required under any Environmental Law as a direct
result of the transaction contemplated by this Agreement, the Selling Parties
hereby agree, to the extent such Environmental Law imposes such obligation on
the Selling Parties, to take reasonable commercial efforts to provide and/or
obtain,
80
in accordance with applicable Environmental Law and in a timely manner, such
notice, approval, disclosure, letter or other communication and undertake to
carry out in a timely manner such action, remediation, clean-up or study and
provide Silgan in a timely manner with a copy of such notice, approval,
disclosure, letter or other communication or proof of completion of such action,
remediation, clean-up and/or study.
(g) Notwithstanding anything herein to the contrary, in no event shall the
rights of the Silgan Indemnitees under this Section 10.3 be limited by any
knowledge of the Silgan Indemnitees or any disclosure made by the Selling
Parties.
(h) For the avoidance of doubt, the Deductible Amount, De Minimis Amount and the
Cap Amount shall not apply to claims pursuant to this Section 10.3.
Section 10.4 [Intentionally Omitted].
-----------------------
Section 10.5 Indemnification by Silgan.
-------------------------
Subject to the other provisions of this Article X and in addition to Section
2.3(a), Silgan shall indemnify and hold harmless the relevant Selling Party from
and against any Losses without duplication suffered or incurred by such Selling
Party after the Closing as a result of, arising out of, relating to or in
connection with:
(a) any breach by Silgan, or any inaccuracy, of any representation or warranty
of Silgan contained in this Agreement or any Ancillary Agreement;
(b) the failure by Silgan or the Purchasers to perform any covenant or agreement
of Silgan or the Purchasers under this Agreement or any Ancillary Agreement;
(c) any liability or obligation of or related to the Acquired Companies other
than the Acquired Company Excluded Liabilities;
(d) the Assumed Liabilities;
(e) (i) any claim by or on behalf of the Employees of the Subject Companies
arising from their employment with or termination by Silgan, any Purchaser or an
Acquired Company after Closing or (ii) any claim for constructive dismissal or
otherwise arising directly or indirectly from any measures Silgan, any
Purchasers or any Acquired Company may take on or after Closing; and
(f) any liability or obligation under a guarantee described on Schedule 6.18.
Section 10.6 Method of Asserting Claims.
--------------------------
All claims for indemnification and any claim for a breach of a representation
and warranty by Silgan or the Selling Parties, except a claim pursuant to
Section 10.3 which the Selling Parties propose to satisfy by remediation, shall
be asserted and resolved as follows:
(a) Third Party Claims. If any claim or demand in respect of which any Silgan
Indemnitee or the Selling Parties might seek indemnity under this Article X is
asserted against the Damaged Party
81
by a Person other than a Party (a "Third Party Claim") prior to the expiration
of the applicable survival period, the Damaged Party shall give written notice
and the details thereof including an estimate of the claimed Losses, copies of
all relevant pleadings, documents and information to the Responsible Party
within thirty (30) days following the assertion of the Third Party Claim against
the Damaged Party (to the extent available at such date); provided that no delay
on the part of the Responsible Party in notifying the Responsible Party shall
relieve the Responsible Party from any obligation hereunder except if the
Responsible Party is materially prejudiced thereby. The Responsible Party shall
have the sole right to defend and/or settle such Third Party Claim by all
appropriate proceedings, which proceedings will be prosecuted to a final
conclusion or will be settled at the sole discretion of the Responsible Party as
long as the Responsible Party agrees in writing that the Damaged Party is
entitled to indemnification by the Responsible Party for such action; provided,
however, that the Responsible Party shall not enter into any settlement that
imposes injunctive or other equitable relief against the Damaged Party or does
not fully and finally release the Damaged Party from all liability, unless
consented to by the Damaged Party, which consent shall not be unreasonably
withheld, delayed or conditioned. The Damaged Party shall cooperate fully in
such defense, including by making available to the Responsible Party all books,
records, documents and personnel within the Damaged Party's control or that it
can reasonably obtain relating to the Third Party Claim. The Damaged Party, at
its expense, may participate in, but not control, any defense or settlement of
any Third Party Claim conducted by the Responsible Party pursuant to this
Section 10.6(a), provided, however, that if the Responsible Party elects not to
defend a Third Party Claim, the Damaged Party shall have the right to defend
and/or settle such Third Party Claim provided that it acts in good faith in
connection therewith. Notwithstanding anything to the contrary, if there is an
accrual on Schedule 1.1(B) for any Third Party Claim to which any of the Silgan
Indemnitees is seeking indemnification pursuant to this Article X, then the
applicable Silgan Indemnitee shall have the sole right to defend and/or settle
such Third Party Claim, provided that it shall not settle such Third Party Claim
in an amount in excess of such accrual without the prior consent of the
applicable Selling Party, not to be unreasonably withheld, conditioned or
delayed.
(b) Other Claims. If any Damaged Party should have a claim under this Article X
against a Responsible Party that does not involve a Third Party Claim, the
Damaged Party shall promptly give written notice (the "Claim Notice") and the
details thereof, including an estimate of the claimed Losses, copies of all
relevant documents and information to the Responsible Party within a period of
thirty (30) days following the discovery of the claim by the Damaged Party. The
Responsible Party shall notify the Damaged Party within a period of twenty (20)
days after the receipt of the Claim Notice by the Responsible Party whether the
Responsible Party disputes its liability to the Damaged Party with respect to
such claim and if the Responsible Party fails to timely notify the Damaged Party
that it disputes its liability, it shall be deemed to have disputed its
obligation to indemnify the Damaged Party. All claims pursuant to this Section
10.6(b) shall be paid within ten (10) days after such twenty (20) day period if
the Responsible Party acknowledges its liability with respect thereto and shall
otherwise be paid within ten (10) days after a final resolution of such claim.
Section 10.7 Limitations on Damages.
----------------------
Subject to the express exceptions and provisions herein set forth, no amount of
damages shall be payable by a Selling Party in the case of (a) a breach of
representation and warranty claim by a
82
Silgan Indemnitee under Section 10.2(a), (b) a claim for indemnification under
Section 10.2(d)(B) or (c) a breach of representation and warranty claim by a
Selling Party under Section 10.5(a), in each case unless and until the Damaged
Party has suffered or incurred Losses, including (in the case of any Silgan
Indemnitee) any Losses suffered or incurred by any Silgan Indemnitee and
required to be borne by the Silgan Indemnitee rather than indemnified by the
Selling Parties pursuant to Section 10.7(c) hereof, aggregating in excess of one
percent (1%) of the Purchase Price (the "Deductible Amount"), whereupon such
Damaged Party shall be entitled to claim damages starting from one-half of the
Deductible Amount and up to the full amount of the Losses. Notwithstanding the
foregoing, (x) in no event shall the aggregate amount payable by the Selling
Parties, on the one hand, or Silgan, on the other hand, exceed 25% of the
Purchase Price (the "Cap Amount"), and (y) no Damaged Party shall make a claim
unless such claim together with all related claims individually exceeds
(euro)100,000 (the "De Minimis Amount"), whereupon such Damaged Party shall be
entitled to claim damages starting from the first Euro of damages not just the
amount in excess of the De Minimis Amount. Any claim not meeting the De Minimis
Amount but exceeding (euro)25,000 shall nevertheless be applied against the
Deductible Amount and shall reduce the Deductible Amount on a Euro for Euro
basis. Any claim for indemnification paid pursuant to this Article X shall be
paid in the applicable currency in which the claim is paid.
Notwithstanding the foregoing:
(a) there shall be no Deductible Amount in the case of a breach of
representation and warranty claim by any Silgan Indemnitee pursuant to Section
4.2, Section 4.5(a), Section 4.6 and Section 4.18;
(b) in the event of one or more claims by any Silgan Indemnitee resulting from
one or more breaches by the Selling Parties of the representations and
warranties pursuant to Section 4.2, Section 4.5(a) and Section 4.6, the Cap
Amount shall not apply to such claims; provided, however, that the aggregate
liability of the Selling Parties as a consequence of all such breach(es),
together with any other liability of the Selling Parties under this Agreement
(other than pursuant to Section 10.2(f), Section 10.2(m) and Section 10.3
(except as it relates to the operation of the Business at the Real Property,
including any Release of any Hazardous Substances in connection therewith) shall
not exceed the Purchase Price;
(c) in the case of a claim for indemnification under Section 10.3 solely as such
indemnification relates to the operation of the Business at the Real Property,
including any Release of any Hazardous Substances in connection therewith, the
Selling Parties shall have no obligation to indemnify any Silgan Indemnitee in
the event and to the extent any Silgan Indemnitee has suffered or incurred
Losses in excess of (euro)5.0 million (it being understood that the Selling
Parties shall be responsible for indemnifying the Silgan Indemnitees for any
Loss suffered or incurred up to (euro)5.0 million) until such time as said
Losses exceed (euro)7.5 million whereupon the Selling Parties will indemnify
such Silgan Indemnitee for such Losses in excess of (euro)7.5 million but
subject to the limit set forth in the proviso in subparagraph (b) above;
provided, that, notwithstanding anything to the contrary herein, none of the
Silgan Indemnitees shall have any liability or obligation for any Losses
relating to, arising out of or in connection with the asbestos materials stored
on the grounds of the Amcor Venezuela manufacturing plant located in Valencua -
Edo. Carabobo, Venezuela as of the date hereof; and
83
(d) to the extent of the amount for the applicable item set forth on Schedule
1.1(B), the Parties acknowledge and agree that the Selling Parties will not be
in breach of any representation or warranty hereunder if the liabilities and
obligations in connection with such breach fall within one of the items listed
on Schedule 1.1(B) and would be included, under Amcor's Financial Controls and
Procedures consistently applied, in the account codes of the Business set forth
next to such item, in any case in the aggregate for all such breaches up to the
amount for such item set forth on Schedule 1.1(B), it being understood and
agreed that (i) liabilities for "Product Warranties" and "Product Warranties w/o
Legal Obligation" are not covered by this paragraph and shall be governed by
Section 6.23, (ii) liabilities and obligations relating to matters covered by
Section 10.2(f) or 10.3 are not covered by this paragraph and are governed by
Section 10.2(f) or 10.3, and (iii) liabilities and obligations covered under any
other Section of this Agreement (other than under Article 4 and Section 10.2(a))
are not covered by this paragraph and are governed by such other Section. For
the avoidance of doubt, notwithstanding anything to the contrary, the amount in
Schedule 1.1(B) for a particular item will only be applied once, and not on a
duplicative basis, in respect of relevant liabilities to which such item
relates.
Section 10.8 Exclusive Remedies.
------------------
The sole and exclusive remedies for any Party with respect to any claim relating
to this Agreement, the Ancillary Agreements or the Transactions and the facts
and circumstances relating and pertaining hereto and thereto shall be limited to
the express provisions of this Agreement (whether any such claim shall be made
in contract, tort or otherwise, including under any applicable securities Laws)
(other than a claim for fraud). No breach of any representation, warranty,
covenant or agreement contained herein shall give rise to any right on the part
of the Selling Parties or Silgan, after the Closing, to rescind this Agreement
or any of the Transactions. Each Party shall take all reasonable steps to
mitigate its Losses upon and after becoming aware of any event that could
reasonably be expected to give rise to any Losses. No Party shall have any right
to setoff against any payments to be made by it pursuant to this Agreement or
otherwise.
Section 10.9 Time Limits on Claims.
---------------------
Except as herein expressly provided to the contrary, no claim shall be brought
for a breach of representation and warranty under Section 10.2(a) and Section
10.5(a) more than two (2) years following the Closing Date. Notwithstanding the
foregoing or any other provision of this Agreement:
(a) Any claim for a breach of any of the representations and warranties made in
Section 4.2, Section 4.5(a) or Section 4.6 may be brought at any time in
perpetuity;
(b) Any claim for a breach of any of the representations and warranties made in
the second sentence of Section 4.11(a)(i), Section 4.11(c) or Section
4.19(b)(iii) may be brought at any time until the fifth anniversary of the
Closing Date; and
(c) Any claim for a breach of the representation and warranty made in Section
4.18 or Article IX may be brought at any time until ninety (90) days after the
underlying obligation is barred by the applicable statute of limitation under
applicable Laws.
84
Any claim not made within the foregoing relevant time periods shall expire and
be forever barred; provided that the time limits on claims relating to Amcor
Brazil if it is a Specified Interest pursuant to Section 3.4 shall be extended
by the time period from the Closing Date until the date of the applicable
delayed closing for Amcor Brazil, but in no event shall such extension exceed
eighteen (18) months, in the event there is a delayed closing for such Specified
Interest as set forth in Section 3.4.
Section 10.10 Tax Effect and Insurance.
------------------------
The liability of the Responsible Party with respect to any Loss shall be reduced
by (a) any actual Tax benefit of such Loss accruing to the Damaged Party in the
year of such Loss and, solely for any Loss from a claim under this Article X in
excess of (euro)200,000 by any Tax benefit of such Loss accruing to the Damaged
Party within three years after such Loss, and (b) by any insurance proceeds
received by the Damaged Party as a result of such Loss and the Damaged Party
shall use commercially reasonable efforts to pursue such Tax benefits and to
pursue claims under the relevant policies of insurance.
Section 10.11 Knowledge of Claim.
------------------
Notwithstanding anything herein to the contrary, Silgan and the Purchasers shall
not be entitled to make a claim with respect to a breach of a representation and
warranty if, as at the Closing Date, any of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇ or
▇▇▇▇▇▇ ▇▇▇▇▇ had actual knowledge that such representation and warranty was
breached or inaccurate and conspired to withhold such information deliberately
with the intention of bringing a claim against the Selling Parties pursuant to
this Article X after the Closing Date. The burden of proof shall be on the
Selling Parties to prove the foregoing by a showing of clear and convincing
evidence (notwithstanding any other level of burden of proof). Notwithstanding
anything to the contrary, the fact that any of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇ or
▇▇▇▇▇▇ ▇▇▇▇▇ or any other Silgan personnel or any of Silgan's representatives or
advisors viewed any document in the Data Room shall not in and of itself
constitute knowledge and the fact that any document or email was sent to any of
▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇ or ▇▇▇▇▇▇ ▇▇▇▇▇ or any other Silgan personnel or any
of Silgan's representatives or advisors shall not in and of itself constitute
knowledge. For the avoidance of doubt, this Section 10.11 shall not apply to any
claims under Sections 10.2(f) or 10.3 or relating to, arising out of or in
connection with the disposal of any asbestos-containing materials stored on the
grounds of the Amcor Venezuela manufacturing plant located in Valencua - Edo.
Carabobo, Venezuela.
ARTICLE XI
MISCELLANEOUS
Section 11.1 Fees and Expenses.
-----------------
(a) All costs and expenses incurred in connection with the negotiation and
preparation of this Agreement, the Ancillary Agreements and the consummation of
the Transactions shall be paid by the Party incurring such expenses, except as
specifically provided to the contrary in this Agreement; provided, however, that
(i) Silgan shall pay all recording fees, title insurance premiums for any title
insurance, surveyor's fees for any survey, title examination, escrow and
85
other fees charged by any title insurer; (ii) Silgan shall pay all stamp, VAT,
duties, transfer and sales Taxes as well as registration fees payable or
assessed in connection with the Transactions and Purchaser shall timely file all
Tax Returns required to be filed in connection with such payments; provided that
the Selling Parties shall pay all applicable VAT, duties, transfer and sales
Taxes for the sale of the Purchased Assets of Amcor Turkey to the applicable
Purchaser and (iii) Silgan shall pay all fees payable or incurred in connection
with filings required of Silgan or any Selling Party or any of their respective
Affiliates under any Antitrust Law.
(b) Notwithstanding Section 11.1(a)(ii), the Parties shall in good faith
consider whether the applicable Purchaser shall purchase the Capital Stock of
Amcor Turkey in lieu of purchasing the Purchased Assets and assuming the Assumed
Liabilities of Amcor Turkey, subject to the following terms and conditions:
(i) Subject to Section 11.1(b)(iv), the applicable Purchaser shall purchase
the Capital Stock of Amcor Turkey in lieu of purchasing the Purchased Assets of
Amcor Turkey and assuming the Assumed Liabilities of Amcor Turkey unless it
gives notice (a "Turkey Notice") to Amcor Australia not later than 45 days
following the date hereof stating that acting in good faith and acting
reasonably it has determined that it is not satisfied with the results of its
due diligence on the liabilities and obligations of Amcor Turkey that do not
relate to the Business, including environmental matters, labour matters and
compliance with law (the "Turkey Determination"'). If Silgan does not give a
Turkey Notice within such 45 day period, it shall be deemed to have irrevocably
and unconditionally waived the right to give a Turkey Notice.
(ii) If Silgan timely gives a Turkey Notice to Amcor Australia and Amcor
Australia believes that the Turkey Determination was not made in good faith,
Amcor Australia may require that the question of whether Silgan made the Turkey
Determination in good faith and acting reasonably be adjudicated by arbitration
in New York, New York in accordance with the expedited rules of JAMS, by a
single arbitrator selected in accordance with such rules (the "Arbitrator"). The
Parties shall use commercially reasonable efforts to cause the arbitration to be
conducted as promptly as practicable. The decision of the Arbitrator shall be
final and binding upon the Parties.
(iii) If Silgan does not timely give a Turkey Notice or, subject to Section
11.1(b)(iv), Silgan timely gives a Turkey Notice and the Arbitrator determines
that Silgan did not act in good faith and reasonably in making the Turkey
Determination, the Parties agree to effect the sale of the Business conducted by
Amcor Turkey through a sale of the Capital Stock of Amcor Turkey rather than
through the sale of the Purchased Assets of Amcor Turkey and the assumption of
the Assumed Liabilities of Amcor Turkey. If Amcor Australia does not decide to
arbitrate in accordance with Section 11.1(b)(ii) or if the Arbitrator determines
that Silgan did act in good faith and reasonably in making the Turkey
Determination, then the sale of the Business conducted by Amcor Turkey shall be
effected by the sale of the Purchased Assets of Amcor Turkey and the assumption
of the Assumed Liabilities of Amcor Turkey and the Selling Parties shall pay all
applicable VAT, duties, transfer and sales Taxes for the sale of such Purchased
Assets.
(iv) Notwithstanding anything herein to the contrary, if the Arbitrator
determines that the Turkey Determination was not made in good faith and acting
reasonably, by notice (an
86
"Election Notice") to Amcor Australia given not later than ten (10) Business
Days following the receipt of the Arbitrator's decision, Silgan may elect to
purchase the Purchased Assets of Amcor Turkey and assume the Assumed Liabilities
of Amcor Turkey rather than purchase the Capital Stock of Amcor Turkey, provided
that in such event, Silgan shall pay all applicable VAT, duties, transfer and
sales taxes for the sale of the Purchased Assets of Amcor Turkey. If Silgan does
not give an Election Notice within such ten (10) Business Day period, it shall
be deemed to have irrevocably and unconditionally waived the right to give an
Election Notice.
(v) Any sale of the Business of Amcor Turkey pursuant to this Agreement,
whether structured as a sale of the Capital Stock of Amcor Turkey or the sale of
the Purchased Assets of Amcor Turkey and the assumption of the Assumed
Liabilities of Amcor Turkey, shall take place on the Closing Date; provided,
however, that if it cannot be effected on the Closing Date because all of the
conditions to closing such sale have not been satisfied or waived, such sale of
the Capital Stock of Amcor Turkey or the sale of the Purchased Assets of Amcor
Turkey and the assumption of the Assumed Liabilities of Amcor Turkey shall be
treated as a Specified Interest under Section 3.4, the Holdback Amount and
Specified Interest Target Working Capital Amount for such Specified Interest
shall be mutually agreed to by the Parties consistent with the principles used
to calculate the Holdback Amounts and Specified Interest Target Working Capital
Amounts for the other Specified Interests and the applicable adjustments to the
Estimated Purchase Price set forth in Section 2.4(f) shall be made. In the event
that the sale of the Capital Stock of Amcor Turkey or the sale of the Purchased
Assets of Amcor Turkey and the assumption of the Assumed Liabilities of Amcor
Turkey is treated as a Specified Interest pursuant to this Section 11.1(b)(v),
the Specified Approval for such purchase and sale shall be the satisfaction or
waiver of all of the conditions to such sale.
(vi) If the sale of the Business of Amcor Turkey is effected through the
sale of the Capital Stock of Amcor Turkey, Silgan shall promptly remit to Amcor
Australia all amounts received by Amcor Turkey that constitute accounts
receivable of the former PET business of Amcor Turkey with respect to sales of
equipment.
(vii) The Selling Parties shall provide the applicable Purchaser with such
information concerning the PET business of Amcor Turkey as it may reasonably
request, including environmental reports, financial statements, information
concerning litigation and government actions and "board reports."
(viii) Notwithstanding the foregoing, Silgan may elect at any time to
purchase the Purchased Assets and assume the Assumed Liabilities of Amcor Turkey
in lieu of purchasing the Capital Stock of Amcor Turkey, provided that Silgan or
the applicable Purchaser shall pay all applicable VAT, duties, transfer and
sales taxes for the sale of the Purchased Assets of Amcor Turkey.
Section 11.2 Equitable Remedies.
------------------
Each of the Selling Parties and Silgan acknowledges and agrees that the other
Parties would be damaged irreparably if any provision of this Agreement or any
Ancillary Agreement is not performed in accordance with its specific terms or is
otherwise breached. Accordingly, each of the Selling Parties and Silgan agrees
that the other Parties shall be entitled to seek an injunction
87
or injunctions to prevent breaches of this Agreement or any Ancillary Agreement
and to enforce specifically this Agreement and any Ancillary Agreement in any
action or proceeding instituted in any court having jurisdiction over the
Parties and the matter, in addition to any other remedy to which they may be
entitled pursuant hereto.
Section 11.3 Further Assurances.
------------------
If at any time after the Closing any further action is necessary or desirable to
carry out the purposes of this Agreement or any Ancillary Agreement, each of the
Parties shall take such further action (including the execution and delivery of
such further instruments and documents) as any other Party reasonably may
request.
Section 11.4 Amendments.
----------
This Agreement may be amended, modified and supplemented only by a written
instrument signed by all of the Parties expressly stating that such instrument
is intended to amend, modify or supplement this Agreement.
Section 11.5 Notices.
-------
(a) All notices and other communications hereunder shall be in writing and shall
be deemed given if delivered personally, telecopied (which is confirmed) or sent
by an overnight courier service to the Parties at the following addresses (or at
such other address for a Party as shall be specified by like notice):
IF TO A SELLING PARTY: Amcor Limited
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇
Attention: Chief Financial Officer
Telephone: ▇▇-▇-▇▇▇▇-▇▇▇▇
Facsimile: ▇▇-▇-▇▇▇▇-▇▇▇▇
COPY TO: Amcor Limited
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇
Attention: Company Secretary
Telephone: ▇▇-▇-▇▇▇▇-▇▇▇▇
Facsimile.: ▇▇-▇-▇▇▇▇-▇▇▇▇
88
COPY TO: Davies ▇▇▇▇ ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP
26TH FLOOR
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇ ▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇
Telephone: ▇▇▇.▇▇▇.▇▇▇▇
Facsimile: 514.841.6497
IF TO SILGAN: Silgan Holdings Inc.
▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Facsimile No.: ▇▇▇-▇▇▇-▇▇▇▇
COPY TO: Silgan Holdings Inc.
▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇, III
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
COPY TO: ▇▇▇▇▇ ▇▇▇▇ LLP
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
(b) Any Party may change the address to which notices to it are to be sent by
giving notice of such change to the other Parties in accordance with this
Section 11.5, provided, however, that such notification shall only be effective
on:
(i) the date specified in the notification as the date on which the change
is to take place; or
(ii) if no date is specified or the date specified is less than five (5)
Business Days after the date on which notice is deemed to have been served, the
date falling five (5) Business Days after notice of any such change is deemed to
have been served.
(c) In proving service of a communication, it shall be sufficient to show that
delivery by hand was made or that the envelope containing the communication was
properly addressed and posted as a pre-paid recorded delivery letter or that the
facsimile transmission was dispatched and a confirmatory transmission report or
other acknowledgment of good receipt was received.
89
Section 11.6 Counterparts.
------------
This Agreement and any of the Ancillary Agreements may be executed in any number
of counterparts, each of which (whether with an original or faxed signature)
shall be considered one and the same agreement and shall become effective when
counterparts have been signed by each of the Parties and delivered to the other
Parties.
Section 11.7 Entire Agreement; No Third Party Beneficiaries.
----------------------------------------------
This Agreement, the Ancillary Agreements and the agreements, documents and
instruments delivered pursuant hereto and thereto contain the final, complete
and exclusive statement of the agreement between the Parties with respect to the
Transactions and all prior or contemporaneous Contracts with respect to the
subject matter hereof are superseded hereby. For greater certainty, in no event
do this Agreement, the Ancillary Agreements and the agreements, documents and
instruments delivered pursuant hereto amend or take priority over any agreements
relating to the sale by Amcor U.S. of its Membership Interest in Amcor White
Cap, LLC to Silgan Closures Corporation. This Agreement shall not confer any
rights or benefits upon any Person other than the Parties, the Purchasers and
their respective successors and permitted assigns and the Silgan Indemnitees
under Articles IX and X.
Section 11.8 Severability.
------------
Any term of this Agreement or any Ancillary Agreement that is held by a court of
competent jurisdiction or other authority to be invalid, void or unenforceable
in any situation in any jurisdiction shall not affect the validity or
enforceability of the remaining terms hereof or thereof or the validity or
enforceability of the offending term in any other situation or in any other
jurisdiction. If the final judgment of a court of competent jurisdiction or
other authority declares that any term hereof or thereof is invalid, void or
unenforceable, the Parties agree that the court or other authority making such
determination shall have the power to replace any invalid, void or unenforceable
term with a term that is valid and enforceable and that comes closest to
expressing the intention of the invalid or unenforceable term.
Section 11.9 Governing Law; Waiver of Jury Trial.
-----------------------------------
(a) This Agreement shall be construed interpreted, enforced and governed by and
under the Laws of New York without regard to its choice of law rules.
(b) Any dispute or controversy arising out of or in connection with this
Agreement or the Ancillary Agreements must be brought in any court of competent
jurisdiction in the Southern District of New York, and, by execution and
delivery of this Agreement, each party (i) accepts, generally and
unconditionally, the exclusive jurisdiction of such courts and any related
appellate court, and irrevocably agrees to be bound by any judgment rendered
thereby in connection with this Agreement and the Ancillary Agreements, (ii)
irrevocably waives any objection it may now or hereafter have as to the venue of
any such suit, action or proceeding brought in such a court or that such court
is an inconvenient forum and (iii) waives personal service of process and
consents to service of process upon it by certified or registered mail, return
receipt requested, at its address specified in Section 11.5, and service so made
shall be deemed completed on the third Business Day after such service is
deposited in the mail. Nothing in this Section 11.9(b) shall
90
affect the right of any party hereto to serve process in any other manner
permitted by applicable Law.
(c) EACH PARTY HERETO HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN
ANY PROCEEDING (WHETHER BASED IN CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR
RELATING TO OR CONNECTED WITH THIS AGREEMENT OR ANY ANCILLARY AGREEMENTS
CONTEMPLATED HEREBY OR THE ACTIONS OF ANY PARTY HERETO IN THE NEGOTIATION,
ADMINISTRATION, PERFORMANCE OR ENFORCEMENT HEREOF.
Section 11.10 Extension; Waiver.
-----------------
(a) At any time prior to the Closing Date, the Selling Parties, on the one hand,
and Silgan, on the other hand, may (i) extend the time for the performance of
any of the obligations or other acts of the other Party or Parties, (ii) waive
any inaccuracies in the representations and warranties of the other Party or
Parties contained in this Agreement or in any document delivered pursuant to
this Agreement or (iii) waive compliance by the other Party or Parties with any
of the agreements or conditions contained in this Agreement. Any agreement on
the part of a Party to any such extension or waiver shall be valid only if set
forth in an instrument in writing signed by or on behalf of such Party.
(b) Except as provided in Section 11.10(a), (i) no delay or omission by any
Party in exercising any right, power or remedy provided by Law or under this
Agreement or the Ancillary Agreements shall affect that right, power or remedy
or operate as a waiver thereof, (ii) the single or partial exercise of any
right, power or remedy provided by Law or under this Agreement shall not
preclude any other or further exercise thereof or the exercise of any other
right, power or remedy and (iii) the rights, powers and remedies provided in
this Agreement are exclusive of any rights, powers and remedies otherwise
provided by Law.
Section 11.11 Assignability.
-------------
Neither this Agreement nor any of the covenants and agreements herein or rights,
interests or obligations hereunder shall be assigned by any of the Parties
(whether by operation of law or otherwise) without the prior written content of
the other Parties. Any such purported assignment shall be null and void.
Notwithstanding the foregoing, prior to the Closing Date, Silgan may assign its
rights and obligations hereunder (including its right to purchase the Purchased
Equity and the Purchased Assets), in whole or in part, to any of its Affiliates
without the consent of any of the other Parties, provided, however, that Silgan
guarantees the obligations of such assignee by remaining obligated as a
Responsible Party under Article IX and Article X pursuant to a guarantee
acceptable in form and substance to the Selling Parties in their sole
discretion. If any of the Selling Parties is no longer an Affiliate of Amcor
Australia, then such Selling Party (except for Amcor Australia) shall be
released from any and all obligations of such Selling Party remaining under this
Agreement. If any of the Purchasers or Acquired Companies is no longer an
Affiliate of Silgan, then such Purchaser or Acquired Company (except for Silgan)
shall be released from any and all obligations of such Purchaser or Acquired
Company remaining under this Agreement. Subject to the preceding sentences, this
Agreement shall be binding upon, inure
91
to the benefit of and be enforceable by the Parties and their respective
successors and permitted assigns.
Section 11.12 Captions.
--------
The captions herein are for convenience of reference only and shall not be
construed as a part of this Agreement.
Section 11.13 Schedules.
---------
Each Schedule referred to in this Agreement is hereby incorporated herein by
reference and shall be deemed and construed to be a part of this Agreement for
all purposes.
Section 11.14 Amcor Australia to Act on Behalf of Selling Parties.
---------------------------------------------------
Each of the Selling Parties irrevocably and unconditionally authorizes Amcor
Australia to act on its behalf in connection with all matters relating to this
Agreement and the Ancillary Agreements.
Section 11.15 Time of Essence.
---------------
Each of the Parties agrees that, with regard to all dates and time periods set
forth or referred to in this Agreement, time is of the essence.
Section 11.16 Joint and Several Liability.
---------------------------
The obligations of Silgan and the Purchasers hereunder shall be joint and
several notwithstanding anything herein to the contrary. The obligations of the
Selling Parties hereunder shall be joint and several, notwithstanding anything
herein to the contrary.
[SIGNATURE PAGE FOLLOWS]
92
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
signed by their respective officers thereunto duly authorized, as of the day and
year first written above.
AMCOR LIMITED
By: /s/ ▇▇▇ ▇▇▇▇▇▇
------------------------------------
Name: ▇▇▇ ▇▇▇▇▇▇
Title: Strategic Business Director
SILGAN HOLDINGS INC.
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
------------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Title: President and Chief Operating
Officer