EXHIBIT 3.6
CONFIDENTIAL MATERIALS OMITTED AND
FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION.
ASTERISKS DENOTE OMISSIONS.
ASSET PURCHASE AGREEMENT
BY AND BETWEEN
AVAYA INC.
AS SELLER
AND
CELESTICA CORPORATION
AS BUYER
DATED AS OF FEBRUARY 19, 2001
TABLE OF CONTENTS
PAGE
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1.
Definitions...........................................................2
1.1 Defined Terms................................................2
1.2 Other Definitional and Interpretive Matters.................12
2. Purchase and Sale of the Business....................................13
2.1 Purchase and Sale of Assets.................................13
2.2 Excluded Assets.............................................14
2.3 Purchase Price..............................................15
2.4 Assumed Liabilities.........................................20
2.5 Excluded Liabilities........................................21
2.6 Further Assurances; Further Conveyances and Assumptions;
Consent of Third Parties....................................21
2.7 No Licenses.................................................23
2.8 Bulk Sales Law..............................................23
2.9 Taxes.......................................................23
3. Representations and Warranties of Seller.............................24
3.1 Organization and Qualification..............................24
3.2 Brokers.....................................................24
3.3 Authorization; Binding Effect...............................24
3.4 Non-Contravention; Consents.................................24
3.5 Title to Property; Principal Equipment......................25
3.6 Permits, Licenses...........................................25
3.7 Real Estate.................................................26
3.8 Compliance With Laws; Litigation............................27
3.9 Business Employees..........................................27
3.10 Contracts...................................................28
3.11 Environmental Matters.......................................28
3.12 Balance Sheet; Absence of Changes...........................29
3.13 Intellectual Property.......................................30
3.14 Sufficiency of Assets.......................................30
3.15 Inventories.................................................30
3.16 No Liabilities..............................................31
3.17 Full Disclosure.............................................31
3.18 Projections.................................................31
3.19 No Other Representations or Warranties......................31
4. Representations and Warranties of Buyer..............................32
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4.1 Organization and Qualification..............................32
4.2 Authorization; Binding Effect...............................32
4.3 No Violations...............................................32
4.4 Brokers.....................................................33
4.5 No Other Seller Representations and Warranties..............33
4.6 Sufficiency of Funds........................................34
5. Certain Covenants....................................................34
5.1 Access and Information......................................34
5.2 Conduct of Business.........................................35
5.3 Tax Reporting and Allocation of Consideration...............37
5.4 Business Employees..........................................37
5.5 Collateral Agreements; Leased Equipment.....................39
5.6 Regulatory Compliance; Thrid Party Consents.................39
5.7 Contacts with Suppliers, Employees and Customers............40
5.8 No Negotiation or Solicitation..............................40
5.9 Environmental Matters.......................................40
5.10 Saumur, France Facility.....................................43
5.11 Schedule Updates............................................43
6. Confidential Nature of Information...................................43
6.1 Confidentiality Agreement...................................43
6.2 Seller's Proprietary Information............................44
7. Closing..............................................................45
7.1 Transfer....................................................45
7.2 Initial Closing.............................................46
7.3 Delayed Closings............................................47
7.4 Place of Closings...........................................48
7.5 Contemporaneous Effectiveness...............................48
7.6 Risk of Loss for Purchased Assets...........................48
7.7 Risk of Loss for Delayed Shreveport Purchased Asset.........49
8. Conditions Precedent to Closings.....................................49
8.1 Conditions Precedent to Initial Closing.....................49
8.2 Conditions Precedent to Delayed Closings....................51
9. Status of Agreements.................................................52
9.1 Effect of Breach............................................52
9.2 Survival of Representations and Warranties..................52
9.3 General Agreement to Indemnify..............................53
9.4 General Procedures for Indemnification......................54
10. Miscellaneous Provisions.............................................55
10.1 Notices.....................................................55
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PAGE
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10.2 Expenses....................................................56
10.3 Entire Agreement; Modification..............................56
10.4 Assignment; Binding Effect; Severability....................57
10.5 Governing Law...............................................57
10.6 Execution in Counterparts...................................57
10.7 Public Announcement.........................................58
10.8 No Third-Party Beneficiaries................................58
11. Termination and Waiver...............................................58
11.1 Termination.................................................58
11.2 Effect of Termination.......................................59
11.3 Waiver of Agreement.........................................59
11.4 Amendment of Agreement......................................59
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SCHEDULES
SCHEDULE 1.1(a) Excluded Contracts
SCHEDULE 1.1(b) Governmental Permits
SCHEDULE 1.1(c) Licenses
SCHEDULE 1.1(d) Principal Equipment
SCHEDULE 2.1(b) Shreveport Equipment
SCHEDULE 2.1(c) Little Rock Leases
SCHEDULE 2.2(j) Certain Identified Excluded Assets
SCHEDULE 2.4(a) Shreveport Equipment Leases
SCHEDULE 3.4(b) Required Consents
SCHEDULE 3.7 Premises
SCHEDULE 3.8(a) Compliance with Laws
SCHEDULE 3.8(b) Litigation
SCHEDULE 3.9(a) Represented Employees, Non-Represented Employees, Represented
Shreveport Employees
SCHEDULE 3.9(b) Benefit Plans
SCHEDULE 3.10 Material Contracts
SCHEDULE 3.11 Environmental Matters
SCHEDULE 3.12 Financial Statements
SCHEDULE 3.13 Intellectual Property Matters
SCHEDULE 3.18 Projections
SCHEDULE 4.3(b) Buyer Consents
SCHEDULE 5.2 Exceptions to Seller's Conduct of Business
EXHIBITS
EXHIBIT A Form of Assignment and ▇▇▇▇ of Sale
EXHIBIT B Form of Assumption Agreement
EXHIBIT C Form of Denver Lease
EXHIBIT D Form of Real Estate Deed
EXHIBIT E Form of Electronics Manufacturing Services Agreement
EXHIBIT F Form of Intellectual Property License Agreement
EXHIBIT G Form of Transition Services Agreement
EXHIBIT H Intentionally Omitted
EXHIBIT I Form of Incentive Agreement
EXHIBIT J Form of Lease Assignment
EXHIBIT K Saumur, France Facility Term Sheet
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ASSET PURCHASE AGREEMENT
THIS ASSET PURCHASE AGREEMENT ("AGREEMENT") is made as of February 19,
2001 by and between AVAYA INC., a Delaware corporation, having an office at ▇▇▇
▇▇. ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ("SELLER"), and CELESTICA
CORPORATION, a Delaware corporation, having an office at ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇ ("BUYER").
R E C I T A L S
A. WHEREAS, Seller is, among other things, engaged in (X) the
manufacturing and repair of printed circuit board assemblies, box build
assemblies and business telephone sets for enterprise and voice data products at
the Denver Premise and the Shreveport Premise (the "PRODUCT BUSINESS"), (Y) the
warehousing and distribution at the Denver Premise and the Shreveport Premise of
finished goods products which are manufactured by Seller and its suppliers for
sale to Seller's customers (the "DISTRIBUTION BUSINESS") and (Z) the
distribution, call center and repair business at the Little Rock Premise (the
"REPAIR BUSINESS," and collectively with the Distribution Business and the
Product Business, the "BUSINESS");
B. WHEREAS, the Business is composed of certain assets and liabilities
that are currently part of Seller;
C. WHEREAS, Seller desires to sell, transfer and assign to Buyer, and
Buyer desires to purchase and assume from Seller, the Purchased Assets (as
hereinafter defined), and Buyer is willing to assume, the Assumed Liabilities
(as hereinafter defined), in each case as more fully described and upon the
terms and subject to the conditions set forth herein; and
D. WHEREAS, Seller (or one of its Affiliates, as applicable) and Buyer
(or one of its Affiliates, as applicable) desire to enter into each of the
Assignment and ▇▇▇▇ of Sale, the Assumption Agreement, the EMS Agreement, the
Intellectual Property License Agreement, the Transition Services Agreement, the
Denver Lease, the Real Estate Deed, the Lease Assignments and the Incentive
Agreement (collectively, the "COLLATERAL AGREEMENTS").
NOW, THEREFORE, in consideration of the mutual agreements and covenants
herein contained and intending to be legally bound hereby, the parties hereto
hereby agree as follows:
1. DEFINITIONS
1.1 DEFINED TERMS
For the purposes of this Agreement, in addition to the words and
phrases that are described throughout the body of this Agreement, the following
words and phrases shall have the following meanings:
"AFFILIATE" of any Person means any Person that controls, is controlled
by, or is under common control with such Person. As used herein, "control" means
the possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of such entity, whether through
ownership of voting securities or other interests, by contract or otherwise.
"AGREEMENT" has the meaning assigned in the preamble hereof.
"ASSET ACQUISITION STATEMENT" has the meaning assigned in Section
5.3 (b).
"ASSIGNMENT AND ▇▇▇▇ OF SALE" means the agreement in substantially the
form set forth as EXHIBIT A.
"ASSUMED LIABILITIES" means the liabilities and obligations of Seller
assumed by Buyer pursuant to the Assumption Agreement and Section 2.4.
"ASSUMPTION AGREEMENT" means the agreement in substantially the form
set forth as EXHIBIT B.
"BENEFIT PLAN" means, in respect of any Business Employee, each
"employee benefit plan," as defined in Section 3(3) of ERISA (including any
"multiemployer plan" as defined in Section 3(37) of ERISA) and each
profit-sharing, bonus, stock option, stock purchase, stock ownership, pension,
retirement, severance, deferred compensation, excess benefit, supplemental
unemployment, post-retirement medical or life insurance, welfare or incentive
plan, or sick leave, long-term disability, medical, hospitalization, life
insurance, other insurance plan, or other employee benefit plan, program or
arrangement, whether written or unwritten, qualified or non-qualified, funded or
unfunded, maintained or contributed to by Seller.
"BUSINESS" has the meaning assigned in Recital A hereof.
"BUSINESS DAY" means a day that is not a Saturday, a Sunday or a
statutory or civic holiday in the State of New York or any other day on which
the principal offices of Seller or Buyer are closed or become closed prior to
2:00 p.m. local time whether in accordance with established company policy or as
a result of unanticipated events, including adverse weather conditions.
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"BUSINESS EMPLOYEES" shall mean, collectively, the Represented
Employees, the Non-Represented Employees and the Represented Shreveport
Employees.
"BUSINESS RECORDS" means all books, records, ledgers and files or other
similar information used primarily in the conduct of the Business at the Denver
Premise and the Little Rock Premise or relating primarily to any of the
Purchased Assets, including price lists, customer lists, vendor lists, mailing
lists, warranty information, catalogs, sales promotion literature, advertising
materials, brochures, records of operation, standard forms of documents, manuals
of operations or business procedures, research materials and product testing
reports required by any national, federal, state, provincial or local court,
administrative body or other Governmental Body of any country, but excluding any
such items to the extent (i) they are included in, or primarily related to, any
Excluded Assets or Excluded Liabilities, (ii) any applicable Law prohibits their
transfer or (iii) they are confidential personnel records.
"BUYER" has the meaning assigned in the preamble hereof.
"BUYER'S AUDITOR" has the meaning assigned in Section 2.3(a).
"CERCLA" means the Comprehensive Environmental Response, Compensation,
and Liability Act of 1980, 42 U.S.C. Sections 9601 ET SEQ., as amended.
"CLOSING" means any one of the Initial Closing or a Delayed Closing, as
applicable.
"CLOSING DATE" means any one of the Initial Closing Date or a Delayed
Closing Date, as applicable.
"CODE" means the U.S. Internal Revenue Code of 1986, as amended.
"COLLATERAL AGREEMENTS" has the meaning assigned in Recital D hereof.
"CONFIDENTIALITY AGREEMENT" shall mean the agreement between Seller and
Buyer dated November 1, 2000.
"CONSULTANT" has the meaning assigned in Section 5.9.
"CONTRACTS" means the Equipment Leases and all other Third-Party
contracts, agreements, leases and subleases, supply contracts, purchase orders,
sales orders and instruments used or held for use primarily in the conduct of
the Business at the Premises that will be in effect on the applicable Closing
Date to which Seller is a party, (i) for the lease of furniture and office
equipment, (ii) for the provision of goods or services by the Business or for
the Business, (iii) for the purchase, procurement or supply of raw materials,
supplies, Inventory or other components, or (iv) any such contracts, agreements,
instruments and leases referred to in clauses (i)-(iii), inclusive, entered into
between the date hereof and
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outstanding as of the applicable Closing Date by Seller; but "Contracts"
excludes the Excluded Contracts.
"COUNSEL FOR BUYER" means Davies ▇▇▇▇ ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP.
"COUNSEL FOR SELLER" means a corporate counsel of Seller.
"DELAYED CLOSING" means any one of the Shreveport Delayed Asset
Closings or the Denver and Little Rock Inventory Closing, as applicable.
"DELAYED CLOSING DATE" means any one of the Shreveport Delayed Asset
Closing Dates or the Denver and Little Rock Inventory Closing Date, as
applicable.
"DELAYED PURCHASED ASSETS" means, collectively, the Delayed Shreveport
Purchased Assets, the Denver and Little Rock Purchased Inventory and the Denver
and Little Rock Purchase Orders.
"DELAYED SHREVEPORT ASSET NET BOOK VALUE" has the meaning assigned in
Section 2.3(b).
"DELAYED SHREVEPORT ASSET NET BOOK VALUE OF THE THIRD AUDITOR" has the
meaning assigned in Section 2.3(b).
"DELAYED SHREVEPORT PURCHASED ASSETS" means, collectively, the
Shreveport Equipment, the Shreveport Purchased Inventory and the Shreveport
Contracts and Licenses.
"DENVER AND LITTLE ROCK INVENTORY CLOSING" means the completion of the
purchase and sale of the Denver and Little Rock Purchased Inventory pursuant to
and in accordance with the terms of this Agreement.
"DENVER AND LITTLE ROCK INVENTORY CLOSING DATE" means the date on which
the Denver and Little Rock Purchased Inventory are transferred to Buyer pursuant
to Section 7.1(c).
"DENVER AND LITTLE ROCK INVENTORY PURCHASE PRICE" has the meaning
assigned in Section 2.3(c).
"DENVER AND LITTLE ROCK INVENTORY SCHEDULE" has the meaning assigned in
Section 2.3(c).
"DENVER AND LITTLE ROCK PURCHASE ORDERS" means, collectively, all
purchase order Contracts relating to the Denver and Little Rock Purchased
Inventory.
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"DENVER AND LITTLE ROCK PURCHASED INVENTORY" means the Purchased
Inventory located at each of the Denver Premise and the Little Rock Premise.
"DENVER INVENTORY" means the Inventory located at the Denver Premise.
"DENVER LEASE" means the lease to be entered into between Seller and
Buyer with respect to the Denver Premise in substantially the form set forth as
EXHIBIT C.
"DENVER PREMISE" means Seller's facility located in Denver, Colorado,
as identified on SCHEDULE 3.7.
"DISTRIBUTION BUSINESS" has the meaning assigned in Recital A hereof.
"EFFECTIVE TIME" means 11:59 p.m. (New York City Time) on any Closing
Date.
"EMS AGREEMENT" means the Electronics Manufacturing Services Agreement
in substantially the form set forth as EXHIBIT E.
"ENCUMBRANCE" means any lien, claim, charge, security interest,
mortgage, pledge, easement, conditional sale or other title retention agreement,
covenant or other similar restrictions or third party rights affecting the
Purchased Assets other than Permitted Encumbrances.
"ENVIRONMENTAL LAW" means any local, county, state or federal Law that
governs the existence of or provides a remedy for the release of Hazardous
Substances, the protection of persons, natural resources or the environment, the
management of Hazardous Substances, or other activities involving Hazardous
Substances including, without limitation, CERCLA or any other similar federal,
state, local or county Laws and occupational, health and safety Laws, in each
case as in effect on or prior to the applicable Closing Date or, with respect to
representations and warranties made on the date hereof, on or prior to the date
hereof.
"ENVIRONMENTAL LIABILITY" has the meaning assigned in Section 2.4(c).
"EQUIPMENT LEASES" means collectively, (i) all leases for personal
computers, servers, machinery, motor vehicles and equipment and other similar
items used by Seller primarily in the conduct of the Business at the Denver
Premise and the Little Rock Premise and (ii) all leases for personal computers,
servers, machinery, motor vehicles and equipment and other similar items used by
Seller primarily in the conduct of the Business at the Shreveport Premise which
are identified on Schedule 2.4(a).
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended.
"EXCLUDED ASSETS" means the properties and assets of the Business
excluded from the Purchased Assets by Section 2.2.
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"EXCLUDED CONTRACTS" shall mean the contracts, agreements, leases and
subleases, supply contracts, purchase orders, sales orders and instruments (i)
identified in SCHEDULE 1.1(a), (ii) under which performance by Seller has been
completed and for which there is no remaining warranty, maintenance, or support
obligation, (iii) related to Excluded Assets or Excluded Liabilities, (iv)
relating to any General Purchase Agreements or original equipment manufacturer
agreements, (v) relating to development and design services arrangements of
Seller, (vi) of Seller relating to consigned products, and (vii) relating to
contract manufacturing.
"EXCLUDED LIABILITIES" means the liabilities and obligations that are
not assumed by Buyer as provided in Section 2.5.
"FIXTURES AND SUPPLIES" means all furniture, furnishings and other
tangible personal property owned by Seller and used or held for use primarily in
the conduct of the Business and located on the Denver Premise and the Little
Rock Premise, including desks, tables, chairs, file cabinets and other storage
devices and office supplies but excluding any such items related to Excluded
Assets or Excluded Liabilities.
"GENERAL PURCHASE AGREEMENTS" shall mean Third-Party supply contracts,
licenses, leases or other agreements between Seller or its Affiliates and a
Third Party pursuant to which Seller or its Affiliates purchase, license or
lease products or services from such Third-Party for any of Seller's or an
Affiliate's businesses other than solely and exclusively for the Business.
"GOVERNMENTAL BODY" means any legislative, executive or judicial unit
of any governmental entity (federal, state, local or foreign) or any department,
commission, board, agency, bureau, official or other regulatory, administrative
or judicial authority thereof.
"GOVERNMENTAL PERMITS" means the governmental permits and licenses,
certificates of inspection, registrations, approvals or other authorizations
issued to Seller with respect to the Business conducted at the Denver Premise
and the Little Rock Premise and necessary for the operation of such Business as
currently conducted under applicable Laws set forth on SCHEDULE 1.1(b).
"HAZARDOUS SUBSTANCE" means any substance that is regulated under any
Environmental Law or is deemed by any Environmental Law to be "hazardous,"
"toxic," a "contaminant," a "waste," a source of contamination or a pollutant.
"HSR ACT" means the ▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Antitrust Improvements Act of
1976, as amended.
"INCENTIVE AGREEMENT" means the Incentive Agreement to be entered into
between Seller, Buyer and Celestica Inc. in substantially the form set forth as
EXHIBIT I.
"INDEMNIFIED PARTY" has the meaning assigned in Section 9.3(a).
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"INDEMNIFYING PARTY" has the meaning assigned in Section 9.4(a).
"INITIAL BALANCE SHEET" has the meaning assigned in Section 3.12.
"INITIAL CLOSING" means the completion of the sale and transfer of the
Purchased Assets other than the Delayed Purchased Assets.
"INITIAL CLOSING DATE" means the later to occur of (i) May 4, 2001, and
(ii) the date that is not more than five (5) Business Days following the date on
which the last of the conditions specified in Section 8.1 to be satisfied or
waived has been satisfied or waived; provided that such date is no later than
June 30, 2001, or such later date as Seller and Buyer may mutually agree.
"INITIAL DENVER AND LITTLE ROCK INVENTORY NET BOOK VALUE" has the
meaning assigned in Section 2.3(c).
"INITIAL DENVER AND LITTLE ROCK INVENTORY NET BOOK VALUE OF THE THIRD
AUDITOR" has the meaning assigned in Section 2.3(c).
"INITIAL PURCHASE PRICE" has the meaning assigned in Section 2.3(a).
"INITIAL PURCHASED ASSETS" has the meaning assigned in Section 2.3(a).
"INITIAL PURCHASED ASSETS SCHEDULE" has the meaning assigned in Section
2.3(a).
"INITIAL PURCHASED ASSETS NET BOOK VALUE" has the meaning assigned in
Section 2.3(a).
"INITIAL PURCHASED ASSETS NET BOOK VALUE OF THE THIRD AUDITOR" has the
meaning assigned in Section 2.3(a).
"INTELLECTUAL PROPERTY LICENSE AGREEMENT" means the agreement in
substantially the form set forth as EXHIBIT F.
"INVENTORY" means (i) all raw materials, work in process, recycled
materials, packaging materials, inventoriable supplies, and non-capital spare
parts owned by Seller and used or held for use primarily in the conduct of the
Product Business, (ii) components used in the repair of products at the Little
Rock Premise, and (iii) any rights of Seller to the warranties received from
suppliers and any related claims, credits, rights of recovery and setoff with
respect to such Inventory, but only to the extent such rights are assignable,
but excluding (X) any inventory related to the Distribution Business, the
Excluded Assets or the Excluded Liabilities, and (Y) any finished goods or Third
Party original equipment manufacturer products.
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"INVESTIGATION" has the meaning assigned in Section 5.9.
"IRS" means the U.S. Internal Revenue Service.
"LAWS" shall mean any national, federal, state, provincial or local
law, statute, ordinance, rule, regulation, code, order, judgment, injunction or
decree of any country.
"LEASE ASSIGNMENT" means the Lease Assignment to be entered into
between Seller and Buyer with respect to the Little Rock Leases in substantially
the form set forth as EXHIBIT J.
"LICENSED INTELLECTUAL PROPERTY" means the Proprietary Information of
Seller and its Affiliates licensed to Buyer (or to any of Buyer's Affiliates)
pursuant to, and as specifically identified and set forth in, the Intellectual
Property License Agreement or the EMS Agreement.
"LICENSES" means all licenses, agreements and other arrangements
identified on SCHEDULE 1.1(c) under which Seller has the right to use any
Proprietary Information of a Third Party to the extent used or held for use
primarily in the conduct of the Business at the Premises but not the
Non-assignable Licenses or any other such items related to Excluded Assets or
Excluded Liabilities.
"LITTLE ROCK INVENTORY" means the Inventory located at the Little Rock
Premise.
"LITTLE ROCK LEASES" means the leases identified on Schedule 2.1(c).
"LITTLE ROCK PREMISE" means Seller's facility located in Little Rock,
Arkansas, as identified on SCHEDULE 3.7.
"LOSSES" has the meaning assigned in Section 9.3(a).
"MATERIAL CONTRACTS" has the meaning assigned in Section 3.10.
"NON-ASSIGNABLE ASSETS" has the meaning assigned in Section 2.6(c).
"NON-ASSIGNABLE LICENSES" means those Licenses of Proprietary
Information to which Seller is the licensee (i) that are not by their terms
assignable to Buyer, or (ii) related to other businesses of Seller and are not
specifically related to the Business.
"NON-REPRESENTED EMPLOYEES" shall mean the non-represented employees of
the Business employed at either the Denver Premise or the Little Rock Premise as
identified on SCHEDULE 3.9(a) (as of the date set forth on such Schedule). Such
Non-Represented Employees who accept Buyer's offer of employment in accordance
with Section 5.4(a), as of the effective date of their employment with Buyer,
shall be referred to as "TRANSFERRED NON-REPRESENTED EMPLOYEES".
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"NOT TO BE ASSIGNED PERMITS" means the Governmental Permits listed on
Schedule 1.1(b) indicated thereon as "Not to be Assigned to Buyer."
"PENSION PLAN" has the meaning assigned in Section 3.9(b).
"PERMITTED ENCUMBRANCES" means any (i) Encumbrance that will constitute
an Assumed Liability, (ii) liens for taxes, assessments and other governmental
charges or of landlords, liens of carriers, warehouseman, mechanics and material
men incurred in the ordinary course of business, in each case for sums not yet
due and payable or due but not delinquent or being contested in good faith by
appropriate proceedings, (iii) liens incurred or deposits made in the ordinary
course of business in connection with workers' compensation, unemployment
insurance and other types of social security or to secure the performance of
tenders, statutory obligations, surety and appeal bonds, bids, leases government
contracts, performance and return of money bonds and similar obligations;
provided that such liens are related to obligations which are not due or
delinquent, are not registered as Encumbrances against title to any of the
Purchased Assets and adequate holdbacks are being maintained as required by
applicable legislation, (iv) purchase money liens arising in the ordinary course
of business, limited to the property acquired, and created, issued or assumed
substantially concurrently with the acquisition of such property, (v) licenses
granted by Seller or an Affiliate in connection with sales of products in the
ordinary course of business which do not in the aggregate materially detract
from the value of the Purchased Assets or materially interfere with the use
thereof in the operation of the Business, and (vi) any Encumbrance or minor
imperfection in title and minor encroachments, if any, not material in amount
that, individually or in the aggregate, do not materially interfere with the
conduct of the Business or with the use of the Purchased Assets and do not
materially affect the value of the Purchased Assets.
"PERSON" means any individual, corporation, partnership, firm,
association, joint venture, joint stock company, trust, unincorporated
organization or other entity, or any government or regulatory, administrative or
political subdivision or agency, department or instrumentality thereof.
"PREMISES" means, collectively, the Shreveport Premise, the Little Rock
Premise and the Denver Premise.
"PRINCIPAL EQUIPMENT" means the personal computers, servers, machinery
and equipment and other similar items owned and used by Seller primarily in the
conduct of the Business at the Denver Premise and the Little Rock Premise
(including, without limitation, all material items which are identified on
Schedule 1.1(d) as of the date set forth on such Schedule) but not any such
items related to Excluded Assets or Excluded Liabilities. Principal Equipment
includes rights to the warranties received from the manufacturers and
distributors of said items and to any related claims, credits, rights of
recovery and setoff with respect to said items, but only to the extent such
rights are assignable.
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"PRODUCT BUSINESS" has the meaning assigned in Recital A hereof.
"PROPRIETARY INFORMATION" means all intellectual property under the
laws of the United States, Canada and other jurisdictions, including all: (i)
trade secrets, confidential information and confidential know-how, including all
unpatented inventions, customer and supplier lists, formulae, systems,
methodologies, ideas, concepts, processes, documents, works, designs,
prototypes, materials, technologies, inventor's notes, blueprints, unpublished
studies and data, libraries, research designs, research results and notes,
prototypes, drawings, design and construction specifications, production,
operating and quality control manuals, technical manuals, marketing strategies,
and current or proposed business opportunities; (ii) copyrights and all waivers
of moral rights associated with copyrights, including all copyrights and moral
rights in software, and also rights to graphic design and user interfaces
elements and "look and feel", and databases; (iii) industrial designs, design
patents and other designs; (iv) mask works and integrated circuit topographies;
(v) patents; (vi) registered and unregistered trade-marks, service marks, sound
marks, trade names, brand names, trade dress, indicia, distinguishing guises,
logos, insignia, designs, business names, domain names, Internet protocol
addresses and classes of Internet protocol addresses, any other source or
business identifiers and fictitious characters, and all goodwill associated with
the foregoing; and all registrations, applications for registration, reissues,
extensions, renewals, divisions, continuations, continuations-in-part,
documentation, licenses, registered under agreements and other agreements
relating to the foregoing.
"PURCHASE PRICE" has the meaning assigned in Section 2.3(c).
"PURCHASED ASSETS" has the meaning assigned in Section 2.1.
"PURCHASED INVENTORY" means, at any Closing Date, Inventory which is
required by Buyer for the performance of Buyer's obligations under the EMS
Agreement for no more than 90 days after such Closing Date.
"REAL ESTATE DEED" means the deed with respect to the Little Rock
Premise in substantially the form set forth as EXHIBIT D.
"REASONABLE COMMERCIAL EFFORTS" means that the obligated party is
required to make a diligent, reasonable and good faith effort to accomplish the
applicable objective. Such obligation, however, does not require an expenditure
of funds or the incurrence of a liability on the part of the obligated party,
nor does it require that the obligated party act in a manner that would be
contrary to normal commercial practices in order to accomplish the objective.
The fact that the objective is or is not actually accomplished is no indication
that the obligated party did or did not in fact utilize its reasonable
commercial efforts in attempting to accomplish the objective.
"REMAINING ASSETS" means, at any time, the Purchased Assets other than
the Purchased Assets previously purchased by Buyer pursuant to and in accordance
with the terms of this Agreement.
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"REPAIR BUSINESS" has the meaning assigned in Recital A hereof.
"REPORTS" has the meaning assigned in Section 5.9.
"REPRESENTED EMPLOYEES" shall mean the employees of the Business
represented by the Union and employed at either the Denver Premise or the Little
Rock Premise as identified on SCHEDULE 3.9(a) (as of the date set forth on such
Schedule). Such Represented Employees who accept Buyer's offer of employment in
accordance with Section 5.4(a), as of the effective date of their employment
with Buyer, shall be referred to as "TRANSFERRED REPRESENTED EMPLOYEES".
"REPRESENTED SHREVEPORT EMPLOYEES" shall mean the employees of the
Business represented by the Union and employed at the Shreveport Premise as
identified on SCHEDULE 3.9(a) (as of the date set forth on such Schedule).
"REPORTS" has the meaning assigned in Section 5.9.
"REQUIRED CONSENT" has the meaning assigned in Section 3.4(b).
"SELLER" has the meaning assigned in the preamble hereof.
"SELLER'S AUDITOR" has the meaning assigned in Section 2.1(a).
"SHREVEPORT CONTRACTS AND LICENSES" means the Contracts and Licenses
relating to the Business conducted at the Shreveport Premise.
"SHREVEPORT DELAYED ASSET CLOSING" means, in respect of a purchase and
sale of any of the Delayed Shreveport Purchased Assets, the completion of the
purchase and sale of such Delayed Shreveport Purchased Assets pursuant to and in
accordance with the terms of this Agreement.
"SHREVEPORT DELAYED ASSET CLOSING DATE" means, in respect of a purchase
and sale of any of the Delayed Shreveport Purchased Assets, the date on which
such Delayed Shreveport Purchased Assets are purchased by Buyer in accordance
with Section 7.1(b).
"SHREVEPORT DELAYED ASSET SCHEDULE" has the meaning assigned in Section
2.3(b).
"SHREVEPORT EQUIPMENT" means the personal computers, servers, machinery
and equipment and other similar items owned and used by Seller primarily in the
conduct of the Business at the Shreveport Premise and which are identified on
Schedule 2.1(b). Shreveport Equipment includes rights to the warranties received
from the manufacturers and distributors of said items and to any related claims,
credits, rights of recovery and setoff with respect to said items, but only to
the extent such rights are assignable.
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"SHREVEPORT PURCHASED INVENTORY" means, as at any Shreveport Delayed
Asset Closing Date, the Purchased Inventory located at the Shreveport Premise
which is to be purchased by Buyer hereunder on such Delayed Shreveport Asset
Closing Date.
"SHREVEPORT PREMISE" means Seller's facility located in Shreveport,
Louisiana, as identified on SCHEDULE 3.7.
"SHREVEPORT PURCHASE PRICE" has the meaning assigned in Section 2.3(b).
"TAXES" means, all taxes of any kind, charges, fees, customs, levies,
duties, imposts, required deposits or other assessments, including, without
limitation, all net income, capital gains, gross income, gross receipt,
property, franchise, sales, use, excise, withholding, payroll, employment,
social security, worker's compensation, unemployment, occupation, capital stock,
ad valorem, value added, transfer, gains, profits, net worth, asset,
transaction, license, severance, stamp, premium, environmental (including taxes
under Code Section 59A), disability, registration, alternative or add-on
minimum, estimated and other taxes, imposed upon any Person by federal, foreign,
state, or local Law or taxing authority, together with any interest and any
penalties, or additions to tax, with respect to such taxes.
"THIRD AUDITOR" has the meaning assigned in Section 2.1(a).
"THIRD PARTY" means any Person not an Affiliate of the other referenced
Person or Persons.
"THIRD-PARTY CLAIM" has the meaning assigned in Section 9.4(a).
"TOTAL AGGREGATE AMOUNT" means the sum of (i) the Purchase Price and
(ii) the total consideration paid by Buyer's Affiliate to Seller under the
Intellectual Property License Agreement.
"TRANSFERRED EMPLOYEES" shall mean the Transferred Non-Represented
Employees and the Transferred Represented Employees.
"TRANSITION SERVICES AGREEMENT" means the agreement in substantially
the form set forth as EXHIBIT G.
"UNION" shall mean the International Brotherhood of Electrical Workers.
1.2 OTHER DEFINITIONAL AND INTERPRETIVE MATTERS
Unless otherwise expressly provided, for purposes of this Agreement,
the following rules of interpretation shall apply:
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CALCULATION OF TIME PERIOD. When calculating the period of time before
which, within which or following which any act is to be done or step taken
pursuant to this Agreement, the date that is the reference date in calculating
such period shall be excluded. If the last day of such period is a non-Business
Day, the period in question shall end on the next succeeding Business Day.
GENDER AND NUMBER. Any reference in this Agreement to gender shall
include all genders, and words imparting the singular number only shall include
the plural and vice versa.
HEADINGS. The provision of a Table of Contents, the division of this
Agreement into Articles, Sections and other subdivisions and the insertion of
headings are for convenience of reference only and shall not affect or be
utilized in construing or interpreting this Agreement. All references in this
Agreement to any "Section" are to the corresponding Section of this Agreement
unless otherwise specified.
HEREIN. The words such as "HEREIN," "HEREINAFTER," "HEREOF," and
"HEREUNDER" refer to this Agreement as a whole and not merely to a subdivision
in which such words appear unless the context otherwise requires.
INCLUDING. The word "INCLUDING" or any variation thereof means
"INCLUDING, WITHOUT LIMITATION" and shall not be construed to limit any general
statement that it follows to the specific or similar items or matters
immediately following it.
SCHEDULES AND EXHIBITS. The Schedules and Exhibits attached to this
Agreement shall be construed with and as an integral part of this Agreement to
the same extent as if the same had been set forth verbatim herein.
2. PURCHASE AND SALE OF THE BUSINESS
2.1 PURCHASE AND SALE OF ASSETS
Upon the terms and subject to the conditions of this Agreement and in
reliance on the representations and warranties contained herein, on the
applicable Closing Date, Seller shall grant, bargain, sell, transfer, assign,
convey and deliver to Buyer, and Buyer shall purchase, acquire and accept from
Seller, all of the right, title and interest in, to and under the Purchased
Assets that Seller possesses and has the right to transfer as the same shall
exist on such applicable Closing Date. For purposes of this Agreement,
"PURCHASED ASSETS" shall mean all the assets, properties and rights used by
Seller, whether tangible or intangible, real, personal or mixed, set forth or
described in Sections 2.1(a) through 2.1(j), inclusive (except in each case for
the Excluded Assets), whether or not any of such assets, properties or rights
have any value for accounting purposes or are carried or reflected on or
specifically referred to in Seller's books or financial statements:
(a) the Principal Equipment;
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(b) the Shreveport Equipment;
(c) the Little Rock Premise and the Little Rock Leases;
(d) the Fixtures and Supplies (but only to the extent such Fixtures and
Supplies were allocated to, and used by, the Transferred Employees);
(e) the Purchased Inventory;
(f) the Licensed Intellectual Property (but only to the extent specifically
set forth in the Intellectual Property License Agreement or the EMS Agreement);
(g) the Contracts; provided, however, that each procurement Contract
(including without limitation any purchase order) will be assigned to Buyer at
the same time the applicable related Purchased Inventory is transferred to
Buyer;
(h) the Licenses;
(i) the Business Records; and
(j) the Governmental Permits but only to the extent that such
Governmental Permits are assignable or transferable to Buyer and excluding the
Not To Be Assigned Permits.
Seller and Buyer acknowledge and agree that title to all Purchased
Assets (including the Delayed Purchased Assets) will transfer from Seller to
Buyer within the United States.
2.2 EXCLUDED ASSETS
Notwithstanding the provisions of Section 2.1, it is hereby expressly
acknowledged and agreed that the Purchased Assets shall not include, and Seller
is not selling, transferring, assigning, conveying or delivering to Buyer, and
Buyer is not purchasing, acquiring or accepting from Seller, the following (the
rights, properties and assets expressly excluded by this Section 2.2 or
otherwise excluded by the terms of Section 2.1 from the Purchased Assets being
referred to herein as the "EXCLUDED ASSETS"):
(a) any of Seller's receivables, cash, bank deposits or similar cash
items or employee receivables;
(b) any Proprietary Information of Seller or any of its Affiliates
(other than certain specified rights in the Licensed Intellectual Property as
expressly provided under the Intellectual Property License Agreement or the EMS
Agreement);
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(c) any (i) confidential personnel records, subject to Section 2.6(a)
below, pertaining to any Business Employee; (ii) other books and records that
Seller is required by Law to retain or that Seller determines are necessary or
advisable to retain; PROVIDED, HOWEVER, that Buyer shall have the right to make
copies of any portions of such retained books and records that relate to the
Business or any of the Purchased Assets; and (iii) any information management
system of Seller other than those used primarily in the conduct of the Business
and contained within computer hardware included as a Purchased Asset pursuant to
Section 2.1;
(d) any claim, right or interest of Seller in or to any refund,
rebate, abatement or other recovery for Taxes, together with any interest due
thereon or penalty rebate arising therefrom, for any periods prior to the
applicable Closing Date;
(e) all "Avaya" marked sales and marketing or packaging materials,
samples, prototypes, other similar Avaya identified sales and marketing or
packaging materials and any marketing studies;
(f) the Excluded Contracts and the Non-assignable Licenses;
(g) any of Seller's rights, claims or causes of action against Third
Parties relating to the assets, properties, business or operations of Seller
arising out of transactions occurring prior to, and including, the applicable
Closing Date;
(h) any insurance policies or rights to the proceeds thereof;
(i) the Not To Be Assigned Permits;
(j) the property or assets specifically identified on SCHEDULE 2.2(j);
(k) Seller's rights and interests in the Denver Premise (except as
specifically contemplated by the Denver Lease) and the Shreveport Premise;
(l) all Hazardous Substances (other than those otherwise constituting a
part of the Purchased Inventory and those Hazardous Substances which come into
existence and are released into the environment as a result of the operation of
that part of the Business that is transferred to Buyer after a Closing); and
(m) all other assets, properties, interests and rights of Seller or any
Affiliate not related primarily to the Business.
2.3 PURCHASE PRICE
(a) INITIAL CLOSING.
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(i) In consideration of the sale, transfer,
assignment, conveyance and delivery by Seller of the Purchased Assets (other
than the Delayed Purchased Assets) to Buyer, and in addition to assuming the
Assumed Liabilities, Buyer shall pay to Seller at the Initial Closing, (x) Seven
Million Dollars ($7,000,000.00) plus (y) the net book value of (A) the Principal
Equipment and (B) the Little Rock Premise (collectively, the "INITIAL PURCHASED
ASSETS") (as may be adjusted in accordance with this Section 2.3(a), the
"INITIAL PURCHASE PRICE") in cash by wire transfer of immediately available
funds to an account designated by Seller's written instructions to Buyer at
least two (2) Business Days prior to Initial Closing. The net book value of the
Initial Purchased Assets shall be determined in accordance with this Section
2.3(a).
(ii) At least ten (10) Business Days prior to the
Initial Closing, Seller will in good faith prepare and deliver to Buyer a
schedule (the "INITIAL PURCHASED ASSETS SCHEDULE") setting forth the net book
value of the Initial Purchased Assets as of the Initial Closing Date. The
Initial Purchased Assets Schedule shall be prepared in a manner consistent with
the preparation of the Initial Balance Sheet. During such ten (10) day period,
Seller and Buyer shall jointly conduct a physical inventory of the Principal
Equipment. Seller shall provide Buyer full access during reasonable business
hours to the Denver Premise and the Little Rock Premise and the relevant records
necessary to review the Initial Purchased Assets Schedule. To the extent Buyer
agrees with Seller's calculation of the net book value of the Initial Purchased
Assets as set forth in the Initial Purchased Assets Schedule, or if Seller and
Buyer agree on a different net book value amount, Buyer shall pay Seller on the
Initial Closing Date such agreed upon amount. To the extent Buyer and Seller
cannot reasonably agree on the net book value of the Initial Purchased Assets by
the day immediately prior to the Initial Closing Date, Buyer shall nevertheless
be obligated to pay Seller on the Initial Closing Date the net book value amount
set forth in the Initial Purchased Assets Schedule, subject to the audit rights
set forth in Section 2.3(a)(iii) below.
(iii) To the extent Buyer and Seller cannot
reasonably agree on the net book value of the Initial Purchased Assets by the
Initial Closing Date, promptly following the Initial Closing Date, Seller's
external auditors ("SELLER'S AUDITOR") and Buyer's external auditors ("BUYER'S
AUDITOR") shall select a third auditor from ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP's New York
office (or, if unavailable, another national certified public accounting firm
reasonably acceptable to each of Seller and Buyer) (the "THIRD AUDITOR") who
shall definitively decide the net book value of the Initial Purchased Assets.
The Third Auditor will be given full access by Buyer, during regular business
hours, to the relevant records and other work papers necessary to review the
Initial Purchased Assets Schedule. Buyer and Seller shall each pay one-half of
the fee charged by the Third Auditor, and each shall be solely responsible for
any fees charged by auditors of such party.
(iv) An amount equal to the net book value of the
Initial Purchased Assets set forth on the Initial Purchased Assets Schedule
shall be referred to as the "INITIAL PURCHASED ASSETS NET BOOK VALUE." An amount
equal to the net book value of the Initial Purchased Assets as determined by the
Third Auditor shall be referred to as the "INITIAL PURCHASED ASSETS NET BOOK
VALUE OF THE THIRD AUDITOR." If the Initial Purchased Assets Net
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Book Value is less than the Initial Purchased Assets Net Book Value of the Third
Auditor, Buyer shall pay the difference between such amounts to Seller in cash
by wire transfer of immediately available funds to an account designated by
Seller's written instructions to Buyer, and if the Initial Purchased Assets
Net Book Value is greater than the Initial Purchased Assets Net Book Value
of the Third Auditor, then Seller shall pay the difference between such
amounts to Buyer in cash by wire transfer of immediately available funds to
an account designated by Buyer's written instructions to Seller. Any such
payment shall be made on or before 60 calendar days after the Initial Closing
Date, and any such payment shall be considered an addition or reduction, as
applicable, to the Purchase Price.
(b) Shreveport Closings
(i) In consideration of the sale, transfer,
assignment, conveyance and delivery by Seller of the applicable Delayed
Shreveport Purchased Asset, Buyer shall pay to Seller at the applicable
Shreveport Delayed Asset Closing, the net book value of the applicable Delayed
Shreveport Purchased Asset (as may be adjusted in accordance with this Section
2.3(b), each, the "APPLICABLE SHREVEPORT PURCHASE PRICE" and collectively, the
"SHREVEPORT PURCHASE PRICE") in cash by wire transfer of immediately available
funds to an account designated by Seller's written instructions to Buyer at
least two (2) Business Days prior to the applicable Shreveport Delayed Asset
Closing. The net book value of the applicable Delayed Shreveport Purchased Asset
purchased at the applicable Shreveport Delayed Asset Closing shall be determined
in accordance with this Section 2.3(b).
(ii) As close to the applicable Shreveport Delayed
Asset Closing as possible, but in any event not more than three (3) Business
Days prior to the applicable Shreveport Delayed Asset Closing, Seller will in
good faith prepare and deliver to Buyer a schedule (each, a "SHREVEPORT DELAYED
ASSET SCHEDULE") setting forth the net book value of the applicable Delayed
Shreveport Purchased Asset as of the applicable Shreveport Delayed Asset Closing
Date. Each Shreveport Delayed Asset Schedule shall be prepared in a manner
consistent with the preparation of the Initial Balance Sheet. During such three
(3) day period, Seller and Buyer shall jointly conduct a physical inventory of
the applicable Delayed Shreveport Purchased Asset. Seller shall provide Buyer
full access during reasonable business hours to the Shreveport Premise and the
relevant records necessary to review the applicable Shreveport Delayed Asset
Schedule. To the extent Buyer agrees with Seller's calculation of the net book
value of the applicable Delayed Shreveport Purchased Asset as set forth in the
applicable Shreveport Delayed Asset Schedule, or if Seller and Buyer agree on a
different net book value amount, Buyer shall pay Seller on the applicable
Shreveport Delayed Asset Closing Date such agreed upon amount. To the extent
Buyer and Seller cannot reasonably agree on the net book value of the applicable
Delayed Shreveport Purchased Asset by the day immediately prior to the
applicable Shreveport Delayed Asset Closing Date, Buyer shall nevertheless be
obligated to pay Seller on the applicable Shreveport Delayed Asset Closing Date
the net book value amount set forth in the applicable Shreveport Delayed Asset
Schedule, subject to the audit rights set forth in Section 2.3(b)(iii) below.
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(iii) To the extent Buyer and Seller cannot
reasonably agree on the net book value of the applicable Delayed Shreveport
Purchased Asset by the applicable Shreveport Delayed Asset Closing Date,
promptly following the applicable Shreveport Delayed Asset Closing Date,
Seller's Auditor and Buyer's Auditor shall select the Third Auditor who shall
definitively decide the net book value of the applicable Delayed Shreveport
Purchased Asset. The Third Auditor will be given full access by Seller, during
regular business hours, to the relevant records and other work papers necessary
to review the applicable Shreveport Delayed Asset Schedule. Buyer and Seller
shall each pay one-half of the fee charged by the Third Auditor, and each shall
be solely responsible for any fees charged by auditors of such party.
(iv) An amount equal to the net book value of the
applicable Delayed Shreveport Purchased Asset set forth on the applicable
Shreveport Delayed Asset Schedule shall each be referred to as a "DELAYED
SHREVEPORT ASSET NET BOOK VALUE." An amount equal to the net book value of the
applicable Delayed Shreveport Purchased Asset as determined by the Third Auditor
shall each be referred to as a "DELAYED SHREVEPORT ASSET NET BOOK VALUE OF THE
THIRD AUDITOR." If the applicable Delayed Shreveport Asset Net Book Value is
less than the applicable Delayed Shreveport Asset Net Book Value of the Third
Auditor, Buyer shall pay the difference between such amounts to Seller in cash
by wire transfer of immediately available funds to an account designated by
Seller's written instructions to Buyer, and if the applicable Delayed Shreveport
Asset Net Book Value is greater than the applicable Delayed Shreveport Asset Net
Book Value of the Third Auditor, then Seller shall pay the difference between
such amounts to Buyer in cash by wire transfer of immediately available funds to
an account designated by Buyer's written instructions to Seller. Any such
payment shall be made on or before 30 calendar days after the applicable
Shreveport Delayed Asset Closing Date, and any such payment shall be considered
an addition or reduction, as applicable, to the Purchase Price.
(c) Denver and Little Rock Inventory Closing
(i) In consideration of the sale, transfer,
assignment, conveyance and delivery by Seller of the Denver and Little Rock
Purchased Inventory, Buyer shall pay to Seller at the Denver and Little Rock
Inventory Closing, (x) TWENTY-SEVEN MILLION DOLLARS ($27,000,000.00) plus (y)
the net book value of the Denver and Little Rock Purchased Inventory (as may be
adjusted in accordance with this Section 2.3(c), the "DENVER AND LITTLE ROCK
INVENTORY PURCHASE PRICE," and together with the Initial Purchase Price and the
Shreveport Purchase Price, the "PURCHASE PRICE") in cash by wire transfer of
immediately available funds to an account designated by Seller's written
instructions to Buyer at least two (2) Business Days prior to the Denver and
Little Rock Inventory Closing. The net book value of the Denver and Little Rock
Purchased Inventory shall be determined in accordance with this Section 2.3(c).
(ii) As close to the Denver and Little Rock Inventory
Closing as possible, but in any event not more than five (5) Business Days prior
to the Denver and Little Rock Inventory Closing, Seller will in good faith
prepare and deliver to Buyer a schedule (the
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"DENVER AND LITTLE ROCK INVENTORY SCHEDULE") setting forth the net book value of
the Denver and Little Rock Purchased Inventory as of the Denver and Little Rock
Inventory Closing Date. In order to prepare the Denver and Little Rock
Inventory Schedule, Buyer shall provide Seller full access during regular
business hours to the Denver Premise and the Little Rock Premise and the
relevant records necessary to prepare the Denver and Little Rock
Inventory Schedule. The Denver and Little Rock Inventory Schedule shall be
prepared in a manner consistent with the preparation of the Initial Balance
Sheet. During such five (5) day period, Seller and Buyer shall jointly conduct a
physical inventory of the Denver and Little Rock Purchased Inventory. To the
extent Buyer agrees with Seller's calculation of the net book value of the
Denver and Little Rock Purchased Inventory as set forth in the Denver and Little
Rock Inventory Schedule, or if Seller and Buyer agree on a different net book
value amount, Buyer shall pay Seller on the Denver and Little Rock Inventory
Closing Date such agreed upon amount. To the extent Buyer and Seller cannot
reasonably agree on the net book value of the Denver and Little Rock Purchased
Inventory by the day immediately prior to Denver and Little Rock Inventory
Closing Date, Buyer shall nevertheless be obligated to pay Seller on the Denver
and Little Rock Inventory Closing Date the net book value amount set forth in
the Denver and Little Rock Inventory Schedule, subject to the audit rights set
forth in Section 2.3(c)(iii) below.
(iii) To the extent Buyer and Seller cannot
reasonably agree on the net book value of the Denver and Little Rock Purchased
Inventory by the Denver and Little Rock Inventory Closing Date, promptly
following the Denver and Little Rock Inventory Closing Date, Seller's Auditor
and Buyer's Auditor shall select the Third Auditor who shall definitively decide
the net book value of the Denver and Little Rock Purchased Inventory. The Third
Auditor will be given full access by Buyer, during regular business hours, to
the relevant records and other work papers necessary to review the Denver and
Little Rock Inventory Schedule. Buyer and Seller shall each pay one-half of the
fee charged by the Third Auditor, and each shall be solely responsible for any
fees charged by auditors of such party.
(iv) An amount equal to the net book value of the
Denver and Little Rock Purchased Inventory set forth in the Denver and Little
Rock Inventory Schedule shall be referred to as the "INITIAL DENVER AND LITTLE
ROCK INVENTORY NET BOOK VALUE." An amount equal to the net book value of the
Denver and Little Rock Purchased Inventory as determined by the Third Auditor
shall be referred to as the "INITIAL DENVER AND LITTLE ROCK INVENTORY NET BOOK
VALUE OF THE THIRD AUDITOR." If the Initial Denver and Little Rock Inventory Net
Book Value is less than the Initial Denver and Little Rock Inventory Net Book
Value of the Third Auditor, then Buyer shall pay the difference between such
amounts to Seller in cash by wire transfer of immediately available funds to an
account designated by Seller's written instructions to Buyer, and if the Initial
Denver and Little Rock Inventory Net Book Value is greater than the Initial
Denver and Little Rock Inventory Net Book Value of the Third Auditor, then
Seller shall pay the difference between such amounts to Buyer in cash by wire
transfer of immediately available funds to an account designated by Buyer's
written instructions to Seller. Any such payment shall be made on or before 60
calendar days after the Denver and Little Rock Inventory Closing Date, and any
such payment shall be considered an addition or reduction, as applicable, to the
Purchase Price.
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2.4 ASSUMED LIABILITIES
On the Initial Closing Date, Buyer shall execute and deliver to Seller,
the Assumption Agreement pursuant to which Buyer shall accept, assume and agree
to pay, perform or otherwise discharge, in accordance with the respective terms
and subject to the respective conditions thereof, all liabilities and
obligations of Seller pursuant to and under the Assumed Liabilities; provided,
the Assumed Liabilities related to the Shreveport Contracts and Licenses and the
Denver and Little Rock Purchase Orders shall not be accepted and assumed by
Buyer on the Initial Closing Date but accepted and assumed by Buyer in
accordance with the second paragraph of this Section 2.4. "ASSUMED LIABILITIES"
shall mean such liabilities and obligations specifically set forth in this
Section 2.4, whether or not any such obligation has a value for accounting
purposes or is carried or reflected on or specifically referred to in either
Seller's books or financial statements:
(a) the liabilities and obligations under the Contracts, the Little Rock
Leases, Licenses and Government Permits (except Government Permits retained by
Seller for which Seller has continuing obligations and responsibilities) in each
case solely to the extent such liabilities and obligations relate to and arise
in connection with the period after the applicable Closing Date;
(b) the Permitted Encumbrances;
(c) subject to the provisions of the Environmental Services Agreement (as
defined in the Denver Lease) (with respect to the Denver Premise), any
liability, obligation, judgment, penalty, fine, expense, or the duty to
indemnify, defend or reimburse any Person, arising out of any actual or alleged
violation of Environmental Laws (the definition of which for such purposes shall
be read without the words "in each case as in effect on or prior to the Initial
Closing Date"), or any actions or proceedings brought or threatened by any Third
Party (collectively, an "ENVIRONMENTAL LIABILITY"), in each case relating to the
Business conducted at the Denver Premise and the Little Rock Premise and
occurring in the period after the Initial Closing Date but solely with respect
to any condition or event (including, without limitation, the use or
concentration(s) of Hazardous Substance(s)) that comes into existence or occurs
after the Initial Closing Date as a result of the operation of such Businesses
following the Initial Closing Date; provided however that, for certainty but
without limiting the foregoing, Assumed Liabilities (X) shall not include any
Environmental Liability arising out of any violation, action or proceeding with
respect to any condition or event that is specifically set forth in the Reports
(subject to the following clause), but (Y) shall include Environmental Liability
to the extent arising out of any exacerbation of any conditions or events set
forth in the Reports if such exacerbation occurs after the Initial Closing Date
to the extent such exacerbation was caused or exacerbated by Buyer or its
agents, contractors or Affiliates; and
(d) the obligations and liabilities with respect to the Transferred
Employees, the Business or the Purchased Assets, known or unknown, absolute or
contingent, arising on or after the Initial Closing Date.
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Simultaneously with the transfer of the applicable Shreveport Contracts
and Licenses and the Denver and Little Rock Purchase Orders pursuant to Section
7.1(b) and Section 7.1(c), respectively, Buyer will accept and assume the
applicable Assumed Liabilities relating to the applicable Shreveport Contracts
and Licenses and the Denver and Little Rock Purchase Orders and in connection
therewith Buyer will execute and deliver to Seller an assumption agreement
substantially in the form of the Assumption Agreement.
2.5 EXCLUDED LIABILITIES
Buyer shall not assume or be obligated to pay, perform or otherwise
assume or discharge any Excluded Liabilities. "EXCLUDED LIABILITIES" shall mean
any liabilities or obligations of Seller or any of its Affiliates, whether
direct or indirect, known or unknown, absolute or contingent, that are not set
forth herein as an Assumed Liability and such other liabilities and obligations
specifically set forth in this Section 2.5, whether or not any such obligation
has a value for accounting purposes or is carried or reflected on or
specifically referred to in either Seller's books or financial statements.
(a) the obligations and liabilities with respect to the Excluded Assets;
(b) subject to the provisions of the Environmental Services Agreement (with
respect to the Denver Premise), any Environmental Liability relating to the
Business conducted at the Denver Premise and the Little Rock Premise and
occurring in the period on or prior to the Initial Closing Date; provided
however that, for certainty without limiting the foregoing, Excluded Liabilities
(X) shall include any Environmental Liability arising out of any violation,
action or proceeding with respect to any condition or event that is specifically
set forth in the Reports (subject to the following clause), but (Y) shall
exclude Environmental Liability to the extent arising out of any exacerbation of
any conditions or events set forth in the Reports if such exacerbation occurs
after the Initial Closing Date to the extent such exacerbation was caused or
exacerbated by Buyer or its agents, contractors or Affiliates; and
(c) any obligations and liabilities of the Seller with respect to Taxes
incurred prior to the Initial Closing Date.
2.6 FURTHER ASSURANCES; FURTHER CONVEYANCES AND ASSUMPTIONS; CONSENT OF
THIRD PARTIES
(a) From time to time following the Initial Closing, Seller hereby agrees
to make available to Buyer non-confidential data in personnel records of
Transferred Employees as is reasonably necessary for Buyer to transition such
employees into Buyer's records.
(b) From time to time following the Initial Closing, Seller and Buyer
shall, and shall cause their respective Affiliates to, execute, acknowledge and
deliver all such further conveyances, notices, assumptions, releases and
acquittances and such other instruments, and
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shall take such further actions, as may be necessary or appropriate to assure
fully to Buyer and its respective successors or assigns, all of the properties,
rights, titles, interests, estates, remedies, powers and privileges intended to
be conveyed to Buyer under this Agreement and the Collateral Agreements and to
assure fully to Seller and its Affiliates and their successors and assigns, the
assumption of the liabilities and obligations intended to be assumed by Buyer
under this Agreement and the Collateral Agreements, and to otherwise make
effective the transactions contemplated hereby and thereby.
(c) Nothing in this Agreement nor the consummation of the transactions
contemplated hereby shall be construed as an attempt or agreement to assign any
Purchased Asset, including any Contract, License, Governmental Permit,
certificate, approval, authorization or other right, which by its terms or by
Law is non-assignable without the consent of a Third Party or a Governmental
Body or is cancelable by a Third Party in the event of an assignment
("NON-ASSIGNABLE ASSETS") unless and until such consents shall be given. Seller
agrees to cooperate with Buyer at its request to use reasonable commercial
efforts to obtain such consents promptly; PROVIDED, HOWEVER, that such
cooperation shall not require Seller to remain secondarily liable or to make any
payment to obtain any such consent with respect to any Non-assignable Asset.
(d) Buyer and Seller agree to use their respective reasonable commercial
efforts to obtain, or to cause to be obtained, any consent, substitution,
approval, or amendment required to novate all obligations under any and all
Contracts or other obligations or liabilities that constitute Assumed
Liabilities or to obtain in writing the unconditional release of Seller and its
Affiliates so that, in any such case, Buyer and its Affiliates shall be solely
responsible for such liabilities and obligations. To the extent permitted by
applicable Law, in the event consents to the assignment thereof cannot be
obtained, such Non-assignable Assets shall be held, as and from the Initial
Closing Date, or, in the case of a Non-assignable Asset which is a Shreveport
Contract or License or a Denver and Little Rock Purchase Order, as and from the
applicable Shreveport Delayed Asset Closing Date or the Denver and Little Rock
Inventory Closing Date, respectively, by Seller in trust for Buyer and the
covenants and obligations thereunder shall be performed by Buyer in Seller's
name and all benefits and obligations existing thereunder shall be for Buyer's
account. Seller shall take or cause to be taken at Buyer's expense such action
in its name or otherwise as Buyer may reasonably request so as to provide Buyer
with the benefits of the Non-assignable Assets and to effect collection of money
or other consideration to become due and payable under the Non-assignable
Assets, and Seller shall promptly pay over to Buyer all money or other
consideration received by it in respect to all Non-assignable Assets.
(e) As of and from the Initial Closing Date, or, in the case of a
Non-assignable Asset which is a Shreveport Contract or License or a Denver and
Little Rock Purchase Order, as and from the applicable Shreveport Delayed Asset
Closing Date or the Denver and Little Rock Inventory Closing Date, respectively,
Seller authorizes Buyer, to the extent permitted by applicable Law and the terms
of the Non-assignable Assets, at Buyer's expense, to perform all the obligations
and receive all the benefits of Seller under the Non-assignable
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Assets and appoints Buyer its attorney-in-fact to act in its name on its behalf
with respect thereto.
2.7 NO LICENSES
Unless expressly set forth in the Intellectual Property License
Agreement or the EMS Agreement, no title, right or license of any kind is
granted to Buyer pursuant to this Agreement with respect to Seller's or any of
its Affiliate's Proprietary Information, either directly or indirectly, by
implication, by estoppel or otherwise.
2.8 BULK SALES LAW
Buyer hereby waives compliance by Seller with the requirements and
provisions of any "bulk-transfer" Laws of any jurisdiction, including Article 6
of the New York Commercial Code, that may otherwise be applicable with respect
to the sale of any or all of the Purchased Assets to Buyer.
2.9 TAXES
(a) Buyer shall pay all applicable Taxes and all recording and
filing fees that may be imposed, assessed or payable by reason of the operation,
or as a result, of this Agreement including the sales, transfers, leases,
rentals, licenses, and assignments contemplated hereby, except for Seller's net
income and capital gains taxes or franchise or other taxes based on Seller's net
income. In addition, Buyer shall be responsible for all Taxes in connection with
its transfer of the Delayed Shreveport Purchased Assets to Mexico. Buyer shall
also be responsible for, and gross up Seller for, any withholding and other
Taxes (except for Seller's net income, capital gains, franchise or other taxes
based on Seller's net income assessed by a taxing authority in the United
States) levied in connection with the payment of the Purchase Price.
(b) Buyer shall be responsible for all Taxes attributable to,
levied upon or incurred in connection with the Purchased Assets pertaining to
the period (or that portion of the period) beginning (i) in the case of
Purchased Assets transferred on the Initial Closing Date, immediately after the
Initial Closing Date and (ii) in the case of any Purchased Assets transferred on
a Delayed Closing Date, immediately after the applicable Delayed Closing Date.
Seller shall be responsible for all Taxes attributable to, levied upon or
incurred in connection with the Purchased Assets pertaining to the period (or
that portion of the period) prior to or on (i) in the case of Purchased Assets
transferred on the Initial Closing Date, the Initial Closing Date and (ii) in
the case of any Purchased Assets transferred on a Delayed Closing Date, the
applicable Delayed Closing Date (except as provided in Section 2.9(a) above).
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3. REPRESENTATIONS AND WARRANTIES OF SELLER
Seller represents and warrants to Buyer that:
3.1 ORGANIZATION AND QUALIFICATION
Seller is a corporation duly organized, validly existing and in good
standing under the Laws of the State of Delaware and has all requisite corporate
power and authority to carry on the Business as currently conducted and to own
or lease and operate the Purchased Assets. Seller is duly qualified to do
business and is in good standing as a foreign corporation (in any jurisdiction
that recognizes such concept) in each jurisdiction where the ownership or
operation of the Purchased Assets or the conduct of the Business requires such
qualification, except for failures to be so qualified or in good standing, as
the case may be, that, individually or in the aggregate, could not reasonably be
expected to have a material adverse effect on the Business taken as a whole.
3.2 BROKERS
Other than ▇▇ ▇▇▇▇▇▇ Securities Inc. and Chase Securities Inc., the
fees and expenses of which will be paid by Seller, no broker, investment banker,
financial advisor or other Person is entitled to any broker's, finder's,
financial advisor's or other similar fee or commission in connection with the
transactions contemplated by this Agreement based upon arrangements made by or
on behalf of Seller or an Affiliate.
3.3 AUTHORIZATION; BINDING EFFECT
(a) Seller has all requisite corporate power and authority to
execute and deliver this Agreement and the Collateral Agreements to which it
will be a party and to effect the transactions contemplated hereby and thereby
and has duly authorized the execution, delivery and performance of this
Agreement and the Collateral Agreements to which it will be a party by all
requisite corporate action.
(b) This Agreement has been duly executed and delivered by Seller
and this Agreement is, and the Collateral Agreements to which Seller will be a
party when duly executed and delivered by Seller will be, valid and legally
binding obligations of Seller, enforceable against Seller, in accordance with
their respective terms, except to the extent that enforcement of the rights and
remedies created hereby and thereby may be affected by bankruptcy,
reorganization, moratorium, insolvency and similar Laws of general application
affecting the rights and remedies of creditors and by general equity principles.
3.4 NON-CONTRAVENTION; CONSENTS
(a) Assuming that all Required Consents listed in SCHEDULE 3.4(b)
have been obtained, the execution, delivery and performance of this Agreement
and the Collateral Agreements by Seller, and the consummation of the
transactions contemplated hereby and
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thereby do not and will not: (i) result in a breach or violation of any
provision of Seller's charter or by-laws, (ii) violate or result in a breach of
or constitute an occurrence of default under any provision of, result in the
acceleration or cancellation of any obligation under, or give rise to a right by
any party to terminate or amend its obligations under, any mortgage, deed of
trust, conveyance to secure debt, note, loan, indenture, lien, lease, agreement,
instrument, order, judgment, decree or other arrangement or commitment to which
Seller is a party or by which it is bound and which relates to the Business or
the Purchased Assets, which violation, breach or default, individually or in the
aggregate, could be reasonably expected to have a material adverse effect on the
Business taken as a whole, or (iii) violate any order, judgment, decree, rule or
regulation of any court or any Governmental Body having jurisdiction over Seller
or the Purchased Assets, and which violation, individually or in the aggregate,
could be reasonably expected to have a material adverse effect on the Business
taken as a whole.
(b) No consent, approval, order or authorization of, or
registration, declaration or filing with, any Person is required to be obtained
by Seller in connection with the execution and delivery of this Agreement and
the Collateral Agreements to which Seller will be a party or for the
consummation of the transactions contemplated hereby or thereby by Seller,
except for (i) any filings required to be made under the HSR Act, (ii) consents
or approvals of Third Parties as set forth in SCHEDULE 3.4(b) that are required
to transfer or assign to Buyer any Purchased Assets or assign the benefits of or
delegate performance with regard thereto, (iii) those set forth in SCHEDULE
3.4(b) (items (i), (ii) and (iii) being referred to herein as the "REQUIRED
CONSENTS"), and (iv) such consents, approvals, orders, authorizations,
registrations, declarations or filings where failure of compliance, individually
or in the aggregate, could not reasonably be expected to have a material adverse
effect on the Business taken as a whole.
3.5 TITLE TO PROPERTY; PRINCIPAL EQUIPMENT
(a) Seller has and at the Closing will have good and valid title
to, or a valid and binding leasehold interest or license in, all real and
personal tangible Purchased Assets free and clear of any Encumbrance except for
Permitted Encumbrances.
(b) Each material item of Principal Equipment and the Shreveport
Equipment is in reasonable operating condition, in light of its respective age,
for the purposes for which it is currently being used, but is otherwise being
transferred on a "where is" and, as to condition, "as is" basis.
3.6 PERMITS, LICENSES
Except for the Governmental Permits, there are no material governmental
permits and licenses, certificates of inspection, registrations, approvals or
other authorizations required under applicable Law necessary for or used by
Seller to operate the Business as now being operated. Each Governmental Permit
is valid and in full force and effect, and Seller is not in default or breach
thereof other than any such default or breach which, individually or in the
aggregate, could not reasonably be expected to have a material adverse effect on
the Business
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taken as a whole. To Seller's knowledge, no proceeding is pending or threatened
to revoke or limit any such Governmental Permit. Seller has provided to Buyer a
true and complete copy of each such Governmental Permit, including all
amendments thereto.
3.7 REAL ESTATE
SCHEDULE 3.7 contains a complete and accurate list of the Premises.
Except as set forth on SCHEDULE 3.7, Seller has good and valid title to and
exclusive right to possess the Denver Premise and the Little Rock Premise.
Except as set forth on SCHEDULE 3.7, the Little Rock Premise is not subject to
any Encumbrance except for Permitted Encumbrances. All buildings, structures,
improvements and appurtenances situated on the Little Rock Premise are in good
operating condition and in a state of good maintenance and repair and are
adequate and suitable for the purposes for which they are currently being used,
and Seller has adequate rights of ingress and egress for the operation of the
Business conducted at the Little Rock Premise in the ordinary course. Except as
set forth on SCHEDULE 3.7, none of such buildings, structures, improvements or
appurtenances (or any equipment thereon), nor the operation or maintenance
thereof, violates any restrictive covenant or any provision of any applicable
Law or encroaches on any property owned by any Third Party. Without limiting the
generality of the foregoing, except as disclosed in SCHEDULE 3.7:
(i) no alteration, repair, improvement or other work has been ordered,
directed or requested in writing to be done or performed to or in respect
of the Little Rock Premise or to any of the plumbing, heating, elevating,
water, drainage or electrical systems, fixtures or works by any
Governmental Body, which alteration, repair, improvement or other work has
not been completed, and to Seller's knowledge, written notification has not
been given to it of any such outstanding work being ordered, directed or
requested, other than those which have been complied with;
(ii) all accounts for work and services performed and materials placed
or furnished upon or in respect of the Little Rock Premise at the request
of Seller have been fully paid and satisfied, and no Person is entitled to
claim an Encumbrance against the Little Rock Premise or any part thereof,
other than for current accounts in respect of which the payment due date
has not yet passed;
(iii) there is nothing owing in respect of the Little Rock Premise by
Seller to any Governmental Body or to any other entity owning or operating
a public utility for water, gas, electrical power or energy, steam or hot
water, or for the use thereof, other than current accounts in respect of
which the payment due date has not yet passed;
(iv) no part of the Little Rock Premise has been taken or expropriated
by any Governmental Body, nor has any notice or proceeding in respect
thereof been given or commenced; and
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(v) there are no material or structural repairs or replacements
which are necessary or advisable to be made to the Little Rock Premise
in order to conduct the Business at the Little Rock Premise in the
manner presently conducted by Seller including, without limitation, no
repairs to, or replacements of, the roof (other than repairs to the
roof due to ice storms) or the mechanical, electrical, heating,
ventilating, air-conditioning, plumbing or drainage equipment or
systems.
3.8 COMPLIANCE WITH LAWS; LITIGATION
(a) Except as set forth on SCHEDULE 3.8(a), with respect to the
Business, Seller is in compliance in all material respects with all applicable
Laws and all decrees, orders, judgments, permits and licenses of or from
Governmental Bodies except for failures to comply that, individually or in the
aggregate, could not reasonably be expected to have a material adverse effect on
the Business taken as a whole.
(b) Except as set forth on SCHEDULE 3.8(b), there are no actions,
suits, proceedings or governmental investigations pending or, to Seller's
knowledge, threatened against it that, individually or in the aggregate, could
be reasonably expected to have a material adverse effect on the Business taken
as a whole.
3.9 BUSINESS EMPLOYEES
(a) SCHEDULE 3.9(a) contains a complete and accurate list of all
the Business Employees as of the date specified on such list, showing for each
Business Employee the position held and aggregate annual compensation (including
bonuses and commissions) for Seller's last fiscal year, and which employees are
represented by the Union. Except as set forth on SCHEDULE 3.9(a), none of the
Business Employees is covered by any union, collective bargaining or other
similar labor agreements.
(b) Except as set forth in SCHEDULE 3.9(b), with respect to all
Business Employees, Seller does not currently maintain, contribute to or have
any liability under any Benefit Plan. With respect to each of the Benefit
Plans identified on SCHEDULE 3.9(b), Seller has made available to Buyer true
and complete copies of the most recent summary plan or other written
description. Each Benefit Plan listed on SCHEDULE 3.9(b) has been operated in
material compliance with applicable law, including ERISA. Except as disclosed
on SCHEDULE 3.9(b), Seller has no obligations for retiree health and life
benefits under any Benefit Plan or has ever represented, promised or
contracted (whether in oral or written form) to any employee(s) that such
employee(s) would be provided with retiree health or life benefits. Seller
has no obligation to contribute to a Multiemployer Plan (as that term is
defined in ERISA Section 3(37)) with respect to the Business, and Seller has
made no contributions to a Multiemployer Plan with respect to the Business
within the last five years. Seller and each trade or business (whether or not
incorporated) under common control with Seller within the meaning of ERISA
Section 4001 has not withdrawn in any complete or partial withdrawal from any
Multiemployer Plan (as that term is defined in ERISA Section 3(37) for which
such withdrawal liability has not been paid to such plan or transferred to a
purchaser in accordance with
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ERISA Section 4204. All contributions required by law have been made under
any such Plan (without regard to waivers granted under Code Section 412) to
any fund, trust, or account established thereunder or in connection therewith
have been made by the due date thereof, or the deadline for making such
contribution has not yet passed. No Plan subject to Part 3 of Subtitle B of
Title I of ERISA or Code Section 412 has incurred any "accumulated funding
deficiency" (as defined therein), whether or not waived. Seller shall provide
"continuation coverage" to any "qualified beneficiary" who is covered by a
"group health plan" sponsored, maintained or contributed to by Seller and who
has experienced a "qualifying event" or is receiving "continuation coverage".
All terms shall be defined in accordance with Code Section 4980B and ERISA
Section 601 et seq.
(c) As relates to the Business, as of the date hereof, there is
not presently pending or existing, and to Seller's knowledge there is not
threatened, any strike, slowdown, picketing, or work stoppage.
3.10 CONTRACTS
SCHEDULE 3.10 contains a complete and accurate list of all outstanding
Contracts as of the date hereof that would require over the full term thereof
payments by or to Seller of more than $250,000 (the "MATERIAL CONTRACTS"). Each
of such Material Contracts is valid, binding and enforceable against Seller and,
to Seller's knowledge, the other parties thereto in accordance with its terms
and is in full force and effect. Seller has performed, in all material respects,
all of the obligations required to be performed by it and is not in default or
alleged to be default in respect of, any Material Contract. Except as set forth
on SCHEDULE 3.10, to Seller's knowledge, each of the other parties to a Material
Contract has performed in all material respects all obligations required to be
performed by it under, and is not in default in any material respect under, any
Material Contracts and no event has occurred that, with notice or lapse of time,
or both, would constitute such a default. Each of the Contracts that is not a
Material Contract is valid, binding and enforceable against Seller and, to
Seller's knowledge, the other parties thereto in accordance with its terms and
is in full force and effect, in each case except where the failure of any such
Contract to be valid, binding and enforceable or in full force and effect,
individually or in the aggregate, could not reasonably be expected to have a
material adverse effect on the Business as a whole. For purposes of this SECTION
3.10 only (other than with respect to the first sentence of this SECTION 3.10),
Material Contracts will also include such Licenses which would require over the
full term thereof payments by or to Seller of more than $250,000.
3.11 ENVIRONMENTAL MATTERS
Except as set forth in SCHEDULE 3.11:
(a) the operations of the Business and the Purchased Assets comply
with all applicable Environmental Laws except where any failure to be in such
compliance, individually or in the aggregate, could not reasonably be expected
to have a material adverse effect on the Business as a whole;
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(b) Seller has, in respect of the Business and the Purchased
Assets, obtained all environmental, health and safety and other Environmental
Law required Governmental Permits necessary for its operations, and all such
Governmental Permits are in good standing; and Seller is in compliance with all
terms and conditions of such permits except where the failure to obtain or
maintain in good standing such Permits, individually or in the aggregate, could
not reasonably be expected to have a material adverse effect on the Business as
a whole;
(c) none of Seller, the Business or any of the Premises, is
subject to any on-going investigation or other proceedings by, order from or
agreement with any Person respecting (X) any Environmental Law or (Y) any
remedial action arising from the release or threatened release of a Hazardous
Substance into the environment;
(d) Seller has in respect of the Business filed all notices
required to be filed under any Environmental Law indicating past or present
treatment, storage or disposal of a Hazardous Substance or reporting a spill or
release of a Hazardous Substance into the environment;
(e) there is not now, nor to Seller's knowledge has there ever
been, on or in any Premise any aboveground or underground storage tanks, PCBs,
asbestos or asbestos-containing material or lead-based paint or any other
Hazardous Substance which is in an amount, concentration, location or otherwise
in violation of Environmental Law or above that recommended or approved by a
Governmental Body for sites used in a manner similar to the Premises;
(f) to Seller's knowledge, Seller has not received any written
notice to the effect that it is or may be liable to any Person as a result of
the release or threatened release of a Hazardous Substance arising from the
operation of the Business except for any notice of such liabilities which,
individually or in the aggregate, could not reasonably be expected to have a
material adverse effect on the Business as a whole; and
(g) Seller has made available to Buyer true and complete copies of
all asbestos and other environmental reports or other material environmental
information relevant to the Purchased Assets, the Denver Premise or the
Business, including without limitation, disclosing the presence of asbestos or
other Hazardous Substances in, on, under or from any real property included on
the Purchased Assets or the Denver Premise or generated by or in connection with
the Business.
3.12 BALANCE SHEET; ABSENCE OF CHANGES
(a) The unaudited balance sheet attached hereto as SCHEDULE 3.12
(the "INITIAL BALANCE SHEET") with respect to the Business fairly presents in
all material respects the material assets of the Business (with respect only to
the Purchased Assets) as of December 31, 2000 and has been prepared based on the
internal accounting principles used historically by Seller. The information set
forth in the Initial Balance Sheet is of the type typically used by Seller in
the preparation of the audited consolidated financial statements of Seller.
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(b) Except as set forth on SCHEDULE 5.2, since December 31, 2000,
Seller has conducted and operated the Business in the ordinary course and the
Business has not suffered any change that, individually or in the aggregate,
could reasonably be expected to have a material adverse effect on the Business
as a whole.
3.13 INTELLECTUAL PROPERTY
(a) Seller owns or has a valid right to grant the licenses in all
of the Licensed Intellectual Property.
(b) Except as set forth in SCHEDULE 3.13, to Seller's knowledge,
there are no claims or demands of any Third Party pertaining to the Licensed
Intellectual Property or the use by Seller of Proprietary Information under the
Licenses, excluding immaterial assertions of rights which have not been
presented in the form of a specific claim or demand, with respect to the
operation of the Business by Seller as of the date hereof with respect to the
Purchased Assets. No proceedings have been instituted, or, to Seller's
knowledge, are pending which challenge the rights of Seller in respect thereof,
excluding immaterial assertions of rights which have not been presented in the
form of a specific claim or demand.
(c) With the exception of the Proprietary Information which is the
subject of Non-assignable Licenses, the Excluded Assets or is identified in item
1 on SCHEDULE 1.1(a), the rights to use the Proprietary Information licensed to
Buyer under the Intellectual Property License Agreement and the EMS Agreement,
and under the Licenses assigned to Buyer under this Agreement include all
material rights to use Proprietary Information employed by Seller in the
operation of the Business or required for the operation of the Business as
currently carried on by Seller.
3.14 SUFFICIENCY OF ASSETS
Except for the Excluded Assets, (i) the Purchased Assets, (ii) the
Business Employees and (iii) the rights to be acquired under this Agreement and
the Collateral Agreements (including the services to be provided pursuant to the
Transition Services Agreement), (X) include all assets, personnel and rights
held by Seller or its Affiliates that are used in the Business, and (Y)
represent all assets, personnel and rights necessary to conduct the Business in
manner currently conducted by Seller. In the event this Section 3.14 is breached
because Seller has failed to identify and transfer any assets or properties or
provide any services used in the Business, such breach shall be deemed cured if
following notice of such circumstance Seller promptly transfers such properties
or assets or provides such services to Buyer, and Buyer shall have no further
remedy with respect thereto other than with respect to Losses actually incurred
prior to any such transfer or provision of services.
3.15 INVENTORIES
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The Inventory is of quality useable in the ordinary course of the
Business as currently conducted by Seller. As of the date hereof, the Inventory
levels have been maintained by Seller at such amounts as are required for the
operation of the Business as currently conducted by Seller.
3.16 NO LIABILITIES
Except as set forth on any of the Schedules attached hereto or as
otherwise contemplated hereby or by the Collateral Agreements, to Seller's
knowledge, there are not any present facts or circumstances related to the
Business that could give rise to liabilities to Buyer after the Initial Closing
Date, the Shreveport Delayed Asset Closing Date and the Denver and Little Rock
Inventory Closing Date, as applicable, except for the Assumed Liabilities.
3.17 FULL DISCLOSURE
Neither this Agreement nor any document to be delivered by Seller nor
any certificate, report, statement or other document furnished by Seller
pursuant to the terms of this Agreement contains or will contain any untrue
statement of a material fact or omits or will omit to state a material fact
necessary to make the statements contained herein or therein not misleading.
3.18 PROJECTIONS
Seller has delivered to Buyer the financial projections (which are
attached hereto as SCHEDULE 3.18)(the "Projections"). The Projections were
prepared by Seller for its internal use. Seller makes no representation or
warranty regarding the accuracy of the Projections or whether such projected
results may be achieved, but does represent and warrant to Buyer that the
Projections were prepared in good faith based on assumptions believed by it to
be reasonable based on Seller's current outlook for Seller's business for the
period of time covered by the Projections. As used herein, "good faith" shall
mean honesty in fact in the preparation of the Projections.
3.19 NO OTHER REPRESENTATIONS OR WARRANTIES
Except for the representations and warranties contained in this Section
3, neither Seller, any Affiliate nor any other Person makes any representations
or warranties, and Seller hereby disclaims any other representations or
warranties, whether made by Seller or any Affiliate, or any of their officers,
directors, employees, agents or representatives, with respect to the execution
and delivery of this Agreement or any Collateral Agreement, the transactions
contemplated hereby or the Business, notwithstanding the delivery or disclosure
to Buyer or its representatives of any documentation or other information with
respect to any one or more of the foregoing. Notwithstanding anything to the
contrary herein, no representation or warranty contained in this Section 3 is
intended to, or do, cover or otherwise pertain to any
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assets that are not included in the Purchased Asset or any liabilities that are
not included in the Assumed Liabilities.
4. REPRESENTATIONS AND WARRANTIES OF BUYER
Buyer represents and warrants to Seller that:
4.1 ORGANIZATION AND QUALIFICATION
Buyer is a corporation duly organized, validly existing and in good
standing under the laws of the State of Delaware, and Buyer has all requisite
corporate power and authority to carry on its business as currently conducted
and to own or lease and operate its properties. Buyer is duly qualified to do
business and is in good standing as a foreign corporation (in any jurisdiction
that recognizes such concept) in each jurisdiction where the ownership or
operation of its assets or the conduct of its business requires such
qualification, except for failures to be so qualified or in good standing, as
the case may be, that, individually or in the aggregate, could not reasonably be
expected to have a material adverse effect on the Buyer's business taken as a
whole.
4.2 AUTHORIZATION; BINDING EFFECT
(a) Buyer has all requisite corporate power and authority to
execute and deliver this Agreement and the Collateral Agreements to which it
will be a party and to effect the transactions contemplated hereby and thereby
and has duly authorized the execution, delivery and performance of this
Agreement and the Collateral Agreements to which it will be a party by all
requisite corporate action.
(b) This Agreement has been duly executed and delivered by Buyer
and this Agreement is, and the Collateral Agreements when duly executed and
delivered by Buyer will be, valid and legally binding obligations of Buyer,
enforceable against it in accordance with their terms, except to the extent that
enforcement of the rights and remedies created hereby and thereby may be
affected by bankruptcy, reorganization, moratorium, insolvency and similar Laws
of general application affecting the rights and remedies of creditors and by
general equity principles.
4.3 NO VIOLATIONS
(a) The execution, delivery and performance of this Agreement and
the Collateral Agreements by Buyer and the consummation of the transactions
contemplated hereby and thereby do not and will not (i) result in a breach or
violation of any provision of Buyer's charter or by-laws, (ii) violate or result
in a breach of or constitute an occurrence of default under any provision of,
result in the acceleration or cancellation of any obligation under, or give rise
to a right by any party to terminate or amend its obligations under, any
material mortgage, deed of trust, conveyance to secure debt, note, loan,
indenture, lien, lease, agreement, instrument, order, judgment, decree or other
material arrangement or commitment
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to which Buyer is a party or by which it or its assets or properties are bound,
or (iii) violate any material order, judgment, decree, rule or regulation of any
court or any Governmental Body having jurisdiction over Buyer or any of
its properties.
(b) Except as set forth on SCHEDULE 4.3(b), no consent, approval,
order or authorization of, or registration, declaration or filing with, any
Person is required to be obtained by Buyer in connection with the execution and
delivery of this Agreement and the Collateral Agreements or the consummation of
the transactions contemplated hereby or thereby other than any (i) any filings
required to be made under the HSR Act and (ii) such consents, approvals, orders,
authorizations, registrations, declarations or filings where failure of
compliance, individually or in the aggregate, could not reasonably be expected
to have a material adverse effect on Buyer's ability to consummate the
transactions contemplated hereby.
4.4 BROKERS
No broker, investment banker, financial advisor or other Person is
entitled to any broker's, finder's, financial advisor's or other similar fee or
commission in connection with the transactions contemplated by this Agreement
based on arrangements made by or on behalf of Buyer or an Affiliate.
4.5 NO OTHER SELLER REPRESENTATIONS AND WARRANTIES
(a) With respect to the Purchased Assets, the Business, or any
other rights or obligations to be transferred hereunder or under the Collateral
Agreements or pursuant hereto or thereto, Buyer has not been induced by and has
not relied upon any representations, warranties or statements, whether express
or implied, made by Seller, any Affiliate, or any agent, employee, attorney or
other representative of Seller or by any Person representing or purporting to
represent Seller that are not expressly set forth in this Agreement or in the
Collateral Agreements (including the Schedules and Exhibits hereto and thereto),
whether or not any such representations, warranties or statements were made in
writing or orally.
(b) Buyer acknowledges that it has made its own assessment of the
future of the Business and is sufficiently experienced to make an informed
judgment with respect thereto; provided that this shall not be construed in any
way to mitigate or otherwise affect the representations and warranties made by
Seller hereunder or under the Collateral Agreements or pursuant hereto or
thereto, all of which shall continue to survive in full force and effect for the
benefit of Buyer in accordance with the terms hereof and thereof. Buyer further
acknowledges that neither Seller nor any Affiliate has made any warranty,
express or implied, as to the future of the Business or its profitability for
Buyer, or with respect to any forecasts, projections or business plans prepared
by or on behalf of Seller and delivered to Buyer in connection with the Business
and the negotiation and the execution of this Agreement.
(c) Buyer acknowledges that any information disclosed by Seller in
the attached Schedules under any section number shall be deemed to be disclosed
and incorporated into
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any other section number under this Agreement where such
disclosure is reasonably apparent from the context of the disclosure.
4.6 SUFFICIENCY OF FUNDS
Buyer (i) has funds available to pay the Purchase Price and any
expenses incurred by Buyer in connection with the transactions contemplated by
this Agreement; (ii) has the resources and capabilities (financial or otherwise)
to perform hereunder and under the Collateral Agreements; and (iii) has not
incurred any obligation, commitment, restriction or liability of any kind,
absolute or contingent, present or future, which would impair or adversely
affect such resources and capabilities.
5. CERTAIN COVENANTS
5.1 ACCESS AND INFORMATION
(a) Seller will give to Buyer and to its officers, employees,
accountants, counsel, environmental consultants, and other representatives
reasonable access during Seller's normal business hours throughout the period
prior to the Closing to all of Seller's properties, books, contracts,
commitments, reports of examination and records (excluding confidential portions
of personnel records) directly relating to the Business or the Purchased Assets
(but excluding the Excluded Assets and Excluded Liabilities and subject to any
limitations that are reasonably required to preserve any applicable
attorney-client privilege or Third-Party confidentiality obligation). Seller
shall assist Buyer in making such investigation and shall cause its counsel,
accountants, engineers, consultants and other non-employee representatives to be
reasonably available to Buyer for such purposes; IT BEING UNDERSTOOD that Buyer
shall reimburse promptly for reasonable and necessary out of pocket expenses
incurred by Seller in complying with any such request by or on behalf of Buyer.
In accordance with and subject to the foregoing, Seller shall permit
environmental consultants retained by Buyer to conduct environmental studies
(including intrusive environmental investigations) of the Premises.
(b) After the Initial Closing Date, Seller and Buyer will provide,
and will cause their respective controlled Affiliates to provide, to each other
and to their respective officers, employees, counsel and other representatives,
upon request (subject to any limitations that are reasonably required to
preserve any applicable attorney-client privilege or Third-Party confidentiality
obligation), reasonable access for inspection and copying of all Business
Records, Governmental Permits, Licenses, Contracts and any other information
existing as of the Initial Closing Date and relating to the Business or the
Purchased Assets, and will make their respective personnel reasonably available
for interviews, depositions and testimony in any legal matter concerning
transactions, operations or activities relating to the Business or the Purchased
Assets, and as otherwise may be necessary or desirable to enable the party
requesting such assistance to: (i) comply with reporting, filing or other
requirements imposed by any foreign, local, state or federal court, agency or
regulatory body; (ii) assert or defend any claims or allegations in any
litigation or arbitration or in any administrative or legal proceeding other
than claims or allegations that one party to this Agreement has
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asserted against the other; or (iii) subject to clause (ii) above, perform its
obligations under this Agreement. The party requesting such information
or assistance shall reimburse the other party for all reasonable
out-of-pocket costs and expenses incurred by such party in providing such
information and in rendering such assistance. The access to files, books and
records contemplated by this Section 5.1(b) shall be during normal business
hours and upon not less than two (2) Business Days' prior written request unless
required sooner under applicable law and shall be subject to such reasonable
limitations as the party having custody or control thereof may impose to
preserve the confidentiality of information contained therein.
(c) Buyer agrees to preserve all Business Records, Licenses and
Governmental Permits relating to the period ending on or before the Initial
Closing Date and to the extent transferred to Buyer for at least seven (7) years
after the Initial Closing Date. After this seven-year period and at least ninety
(90) days prior to the planned destruction of any such Business Records,
Licenses or Governmental Permits, Buyer shall notify Seller in writing and shall
make available to Seller, upon its request, such Business Records, Licenses and
Governmental Permits. Buyer further agrees that, to the extent such Business
Records, Licenses or Governmental Permits are placed in storage, they will be
indexed in such a manner as to make individual document retrieval possible in as
expeditious a manner as is reasonably practicable under the circumstances.
(d) After the Initial Closing Date, Buyer will provide, and will
cause its Affiliates to provide, to Seller and its officers, employees, agents,
advisors, consultants, contractors/subcontractors and other representatives, as
well as any representatives of any Governmental Body as Seller deems reasonably
required, upon Seller's request, commercially reasonable access to the Denver
Premise and the Little Rock Premise, at such times and in such a manner as
reasonably required to effectuate the provisions of Section 5.9 (such access to
be provided both during normal business hours and at such other times as may be
reasonably necessary), including, without limitation, performing studies,
investigations, remediation, monitoring activities or any government-required
activities in furtherance of the provisions of Section 5.9; provided that Seller
will use reasonable commercial efforts to ensure that such access minimizes any
disruption to or adverse effect on activities on and around such Premises.
Notwithstanding the foregoing, with respect to the Little Rock Premise only, if
pursuant to the previous sentence, Seller's request for access to the Little
Rock Premise will cause Seller to enter into any portion of the Little Rock
Premise covered by the Little Rock Leases, Buyer's obligations under this
Section 5.9 with respect to the areas covered by the Little Rock Leases shall be
limited to using commercially reasonable efforts to enforce Buyer's "right of
entry" under the relevant Little Rock Lease. Seller will (a) cause all
information derived from or in connection with such activities to be subject to
reasonable confidentiality limitations in favor of Buyer and, if appropriate,
others whom Buyer designates, and (b) provide indemnification protection for
Buyer and its Affiliates that is reasonable under the circumstances.
5.2 CONDUCT OF BUSINESS
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From and after the date of this Agreement and until the Initial Closing
Date, except as set forth on SCHEDULE 5.2 or as otherwise contemplated by this
Agreement or the Schedules hereto or as Buyer shall otherwise consent to in
writing, Seller, with respect to the Business:
(a) will carry on the Business in the ordinary course consistent
with past practice;
(b) will not permit, other than in the ordinary course of business
consistent with past practice or as may be required by Law or a Governmental
Body, all or any of the Purchased Assets (real or personal, tangible or
intangible) presently and actively used in the operation of the Business to be
sold, licensed or subjected to any Encumbrance (other than a Permitted
Encumbrance granted in the ordinary course of business);
(c) will not acquire, sell, lease, license, transfer or dispose of
any asset that would otherwise be a Purchased Asset except in the ordinary
course of business consistent with past practice;
(d) will not terminate or materially extend or materially modify
any material Contract except in the ordinary course of business consistent with
past practice; provided however that Seller shall provide written notice to
Buyer before or promptly following any such termination, extension or
modification;
(e) will not do any other act which would cause any representation
or warranty of Seller in this Agreement to be or become untrue in any material
respect or intentionally omit to take any action necessary to prevent any such
representation or warranty from being untrue in any material respect at such
time; or
(f) will not enter into any agreement or commitment with respect to
any of the foregoing.
From and after the Initial Closing Date until any Delayed Closing Date,
as applicable, except as set forth on SCHEDULE 5.2 or as otherwise contemplated
by this Agreement or the Schedules hereto or as Buyer shall otherwise consent to
in writing, Seller, with respect to the Remaining Assets:
(a) will not permit, other than in the ordinary course of business
consistent with past practice or as may be required by Law or a Governmental
Body, all or any of the Remaining Assets (real or personal, tangible or
intangible) to be sold, licensed or subjected to any Encumbrance (other than a
Permitted Encumbrance granted in the ordinary course of business);
(b) will not acquire, sell, lease, license, transfer or dispose of
any asset that would otherwise be a Remaining Asset except in the ordinary
course of business consistent with past practice;
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(c) will not terminate or materially extend or materially modify
any material Contract which is a Remaining Asset except in the ordinary course
of business consistent with past practice; provided however that Seller shall
provide written notice to Buyer before or promptly following any such
termination, extension or modification;
(d) will not do any other act which would cause any representation
or warranty of Seller relating to any Remaining Asset in this Agreement to be or
become untrue in any material respect or intentionally omit to take any action
necessary to prevent any such representation or warranty from being untrue in
any material respect at such time; or
(e) will not enter into any agreement or commitment with respect to
any of the foregoing.
5.3 TAX REPORTING AND ALLOCATION OF CONSIDERATION
(a) Seller and Buyer acknowledge and agree that (i) Seller will be
responsible for and will perform all tax withholding, payment and reporting
duties with respect to any wages and other compensation paid by Seller to any
Business Employee in connection with operating the Business prior to or on the
Initial Closing Date and (ii) Buyer will be responsible for and will perform all
tax withholding, payment and reporting duties with respect to any wages and
other compensation paid by Buyer to any Transferred Employee in connection with
operating the Business after the Initial Closing Date.
(b) Seller and Buyer recognize their mutual obligations pursuant
to Section 1060 of the Code to timely file IRS Form 8594 (the "ASSET ACQUISITION
STATEMENT") with each of their respective federal and, where appropriate or
necessary, state or local income tax returns. Accordingly, within 120 days of
the Initial Closing Date, Seller and Buyer agree to attempt in good faith to (i)
enter into an agreement on the allocation of the Purchase Price among the
Purchased Assets consistent with the provisions of Section 1060 of the Code and
the Treasury Regulations thereunder and (ii) cooperate in the preparation of the
Asset Acquisition Statement for timely filing in each of their respective
federal income tax returns. If Seller and Buyer agree on a Purchase Price
allocation, then neither Seller nor Buyer shall file any tax return taking a
position inconsistent with such allocation.
5.4 BUSINESS EMPLOYEES
(a) On the Initial Closing Date, Buyer shall make offers of
employment to all Represented Employees and Non-Represented Employees employed
by Seller as of the Initial Closing Date (including those absent due to vacation
or holiday). Buyer shall make offers of employment to all Represented Employees
and Non-Represented Employees employed by Seller as of the Initial Closing Date
who are absent due to illness, leave of absence or disability if such
individuals present themselves for full-time employment (except to the extent
required by Law) with Buyer within six (6) months of the Initial Closing Date.
Seller shall continue to provide medical, dental, vision (for Represented
Employees) and life and
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accidental death and dismemberment coverage for the Transferred Employees
through the last day of the month in which the Initial Closing Date occurs;
provided, Buyer shall reimburse Seller any COBRA costs associated with such
coverage.
(b) Employment by Buyer of the Transferred Represented Employees
following the Initial Closing Date shall be on terms and conditions consistent
with the collective bargaining agreements entered into by Buyer and the Union,
with such changes in such terms and conditions as agreed to by such parties.
(c) Buyer shall provide for a total compensation package of salary
and benefits (on an aggregate basis) to each Transferred Non-Represented
Employee which is substantially similar to that offered by Buyer to similarly
situated employees of Buyer. Employment with Buyer of Transferred
Non-Represented Employees shall be effective as of the Business Day following
the close of business on the Initial Closing Date, except that the employment of
(i) individuals receiving disability benefits or on a leave of absence on the
Initial Closing Date will become effective as of the date they present
themselves for work with the Buyer (provided that such individuals present
themselves for full-time employment (except to the extent required by Law) with
Buyer within six (6) months of the Initial Closing Date), and (ii) individuals
who are in the process of applying for visas will become effective as of the
date that their visas are transferred to Buyer and in the interim will continue
to be employed by Seller or the applicable Subsidiary and made available
pursuant to the Transition Services Agreement to Buyer who shall reimburse
Seller for all direct costs of such employment. Buyer will continue to provide
relocation assistance to those Transferred Non-Represented Employees receiving
it as of the Initial Closing Date (not to exceed total relocation payments of
$25,000) in accordance with such records as are provided by Seller to Buyer to
substantiate such amounts and the final dates of such payments.
(d) Buyer's 401(k) plan, medical, dental and life insurance plan,
and paid time off policy shall recognize for each Transferred Employee who is a
Non-Represented Employee, and Buyer's 401(k) plan and paid time off policy shall
recognize for each Transferred Employee who is a Represented Employee for
purposes of determining eligibility to participate, vesting and for any schedule
of benefits based on service, all service with Seller or its Affiliates,
including service with predecessor employers that was recognized by Seller or
its Affiliates and any prior unbridged service with Seller or its Affiliates, in
accordance with such dates as provided to Buyer by Seller. Buyer's medical and
dental program shall recognize for each Transferred Employee for purposes of
satisfying any deductibles during the coverage period that includes the Initial
Closing Date, any payment made by any such employee towards deductibles in any
medical or dental program of Seller to the extent permitted by the insurance
companies providing such benefits. Buyer shall use commercially reasonable
efforts to cause the insurance companies providing such benefits to recognize
such payments.
(e) Buyer agrees that its health and welfare plans (other than
long term disability and life insurance programs) shall waive any pre-existing
condition exclusion (to the extent such exclusions were waived under applicable
health and welfare plans offered to the Transferred Employees by Seller and to
the extent permitted by the insurance companies
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providing such benefits to Buyer's employees) and any requirement for proof of
insurability (to the extent permitted by the insurance companies providing such
benefits to Buyer's employees).
(f) Seller shall pay out all vacation owed to Transferred
Employees who are Represented Employees as of the Initial Closing Date, and
Buyer shall have no liability for vacation owed by Seller to Represented
Employees. Seller shall pay out all vacation owed to Transferred Employees who
are Non-Represented Employees as of the Initial Closing Date with respect to
accrued, unused vacation time for a Non-Represented Employee in excess of 40
hours (or all accrued, unused vacation owed if requested by a Transferred
Employee). Prior to the Initial Closing Date, Seller will provide Buyer with a
schedule indicating the accrued vacation for Transferred Employees who are
Non-Represented Employees as of the Initial Closing Date up to a maximum of 40
hours for each Transferred Employee who is a Non-Represented Employee. Buyer
shall credit each Transferred Employee with such accrued vacation time in
addition to any vacation generally granted to similarly situated employees of
Buyer. Seller shall provide Buyer individual records substantiating the
remaining unused vacation balances as of the Initial Closing Date for
Transferred Employees who are Non-Represented Employees.
(g) Following the Initial Closing Date, as Buyer transitions the
Business from the Shreveport Premise to Buyer's facilities, Buyer may make an
opportunity for employment available to such Represented Shreveport Employees
and non-represented Shreveport employees as Buyer may select, to commence after
the date when such employee's employment by Seller at the Shreveport Premise
concludes. Such employment shall be on terms and conditions consistent with the
terms set forth herein with respect to the Transferred Employees, as applicable.
5.5 COLLATERAL AGREEMENTS
On or prior to the Initial Closing Date, Buyer (and/or any of its
Affiliates, as applicable) shall execute and deliver to Seller, and Seller
(and/or any of its Affiliates, as applicable) shall execute and deliver to Buyer
the Collateral Agreements.
5.6 REGULATORY COMPLIANCE; THIRD PARTY CONSENTS
Buyer and Seller shall cooperate, and shall cause their respective
controlled Affiliates to cooperate, with the other in making filings under the
HSR Act and any other applicable antitrust Law, and each party shall use its
reasonable commercial efforts to resolve such objections, if any, as the
Antitrust Division of the Department of Justice or the Federal Trade Commission
or state antitrust enforcement or other Governmental Body may assert under the
antitrust Laws with respect to the transactions contemplated hereby. In the
event an action is instituted by any Person challenging the transactions
contemplated hereby as violative of the antitrust Laws, Buyer and Seller shall
use, and shall cause their respective controlled Affiliates to use, their
respective reasonable commercial efforts to resist or resolve such action. In
addition, as soon as practicable after the date hereof, Seller and Buyer will
agree
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to work together in good faith to determine which of the Required Consents
listed on SCHEDULE 3.4(b) shall be obtained prior to the Initial Closing Date.
5.7 CONTACTS WITH SUPPLIERS, EMPLOYEES AND CUSTOMERS
Without the prior written consent of Seller, which may be withheld for
any reason or no reason, Buyer agrees it will not contact any suppliers to, or
customers of, the Business or any Business Employees in connection with or
pertaining to any subject of this Agreement.
5.8 NO NEGOTIATION OR SOLICITATION
Prior to the Initial Closing Date, Seller will not (and Seller will
cause each of its employees, officers and agents not to) (a) solicit, initiate,
entertain or encourage the submission of any proposal or offer from any Person
(other than Buyer) relating to the direct or indirect acquisition of the
Business or all or any portion of the Purchased Assets (other than in the
ordinary course of business), or (b) participate in any discussions or
negotiations regarding, furnish any information with respect to, assist or
participate in, or facilitate in any other manner any effort or attempt by any
such Person to do or seek any of the foregoing. Seller will notify Buyer if any
such Person makes any proposal, offer, inquiry or contact with respect to any of
the foregoing.
5.9 ENVIRONMENTAL MATTERS
(a) The parties have collectively engaged ▇▇▇▇▇▇ Associates Ltd.
(the "CONSULTANT") to perform an environmental investigation (the
"INVESTIGATION") in, on, under and, to the extent reasonably practicable, about
each of the Denver Premise and the Little Rock Premise with a view to
discovering and recording the environmental condition (including, without
limitation, the presence or release of Hazardous Substances) of each of such
Premises and the business operations conducted thereon and of other lands to the
extent affected by activities conducted on or in connection with each of such
Premises, in each case, as in effect as of the Initial Closing Date. The
Investigation will continue following the date hereof with the intent of
completing the Investigation within three months from the date hereof. The
Investigation will include the completion of the Phase I Environmental Site
Assessment process complying with ASTM Standard E1527-00, enhanced to address
asbestos and asbestos containing materials and wetlands issues, and, unless
considered unnecessary by the Consultant, acting reasonably, a Phase II
Environmental Site Assessment designed to address, confirm and delineate all
potential environmental conditions identified in the said Phase I Environmental
Site Assessments. Notwithstanding the foregoing, Seller and Buyer acknowledge
that that completion of the Investigation shall most likely occur following that
Initial Closing Date and that the completion of the Investigation shall not be a
condition to the Initial Closing.
(b) The reports to be produced recording matters relevant to the
Phase I and Phase II Environmental Site Assessments (the "REPORTS") shall, among
other things, set out the location, extent and concentration of each Hazardous
Substance discovered on or from each
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of such Premises. Seller will make available to the Consultant all environmental
information in its possession or under the control (or which with reasonable
efforts could be in the possession or under the control) of the Seller and any
of its Affiliates. Seller and Buyer and their Affiliates will use commercially
reasonable efforts to cooperate with Consultant in connection with the conduct
of the Investigation, including, without limitation, making their personnel
reasonably available to the Consultant and its agents and representatives.
Seller and Buyer shall each share equally all fees of the Consultant in
connection with the Investigation, including the preparation of and finalization
of the Reports, and shall each otherwise be responsible for any costs such party
incurs in connection therewith. The parties will have an opportunity to review
and comment on the draft Reports upon their becoming available and before being
prepared by the Consultant in final form. Each of Seller and Buyer shall keep
the Reports confidential except that (X) Buyer and Seller shall each be entitled
to provide copies of the Reports to (i) Affiliates and advisors to Buyer and
Seller and their advisors' Affiliates, (ii) those investment dealers, lenders
and others providing financial or other services to or in connection with the
Buyer or any of its Affiliates, and (iii) such Persons reasonably determined by
Seller to require such information to effectuate the provisions of this Section
5.9; and (Y) either Buyer or Seller may use or provide the Reports as is
required by applicable Law, by securities regulatory authorities and stock
exchanges or in connection with any dispute relating hereto.
(c) Seller will take all reasonable action, including any action
required by Environmental Law, to remediate or otherwise deal with any
environmental conditions (including, without limitation, the presence or release
of Hazardous Substances) connected to any of the Denver Premise or the Little
Rock Premise and identified in the Reports, and will retain responsibility for
those conditions in accordance this Agreement. All such action shall be
conducted in a manner complying with Environmental Law and other relevant Laws
and requirements of Governmental Bodies, which shall include without limitation
minimising interference (to the extent practicable) with activities of Buyer and
others on such Premises, using reasonably competent personnel as selected by
Seller to accomplish such objectives and restoring such Premises to a condition
after such action consistent with the use of such Premises for industrial or
commercial activity of the type presently conducted by Seller. Buyer shall
cooperate with Seller as necessary to effectuate the provisions of this Section
5.9 (including without limitation furtherance of the investigatory and remedial
actions set forth above) in accordance with the provisions of this Agreement
provided that all reasonable costs thereof shall be on the account of Seller. In
the case of the Little Rock Premise, Seller shall report to the Arkansas
Department of Environmental Quality ("ARDEQ") the conditions cited in the
Reports regarding the Little Rock Premise and perform such remediation as is
required by the ARDEQ for Seller to obtain, and provide to Buyer, a certificate
of no further action (or another document providing equivalent confirmation)
(the "NFA Certificate") to the effect that all work required in connection with
the conditions cited in the Reports has been performed and that no further
action is required. Such NFA Certificate also shall include all work required
under the Consent Administrative Order in matter LIS 98-104 (as may be amended
from time to time until the issuance of the NFA Certificate, the "CAO") to the
effect that no further action is required under the CAO. Seller shall use
reasonable commercial efforts to obtain the NFA Certificate as soon as
reasonably possible after Seller
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completes the remediation of, or otherwise dealing with, the environmental
conditions identified in the Report for the Little Rock Premise. Buyer
acknowledges that the work required under the CAO, including groundwater
monitoring, is anticipated to proceed for many years and that the NFA
Certificate for the Little Rock Premise may not be available from the ARDEQ
until the completion of that work.
(d) Seller shall be responsible for the removal of Hazardous
Substances from the Shreveport Equipment that may be found therein or thereon
(unless such removal renders such Shreveport Equipment inoperable) in accordance
with applicable Environmental Laws prior to the applicable Shreveport Delayed
Asset Closing Date(s). Seller shall dispose of any Hazardous Substances removed
from the Shreveport Equipment in accordance with applicable Environmental Laws.
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5.10 SAUMUR, FRANCE FACILITY
(a) Following the date hereof, Seller and Buyer shall use
reasonable best efforts as promptly as practicable to effectuate the acquisition
by Buyer (or one of its Affiliates) of Seller's manufacturing facility and
related assets in Saumur, France as described in the Descriptive Memorandum of
Seller, dated July 2000, as amended, relating to such facility for an aggregate
purchase price equal to the book value of such facility and the assets related
thereto (such amount to be calculated substantially in accordance with the
preparation of the Initial Balance Sheet) and otherwise on terms and conditions
substantially consistent with terms and conditions of the transactions
contemplated by this Agreement (as modified in accordance with the requirements
of applicable Law and the particular circumstances related to such facility and
assets) and reflecting the terms described in the term sheet annexed as Exhibit
K to this Agreement. Notwithstanding the foregoing, Seller and Buyer acknowledge
that completion of such transaction shall most likely occur following that
Initial Closing Date and that the completion of such transaction shall not be a
condition to the Initial Closing.
(b) For a period of six (6) months following the date hereof
(assuming that this Agreement has not been terminated by either party pursuant
to Section 11.1(c); provided, if this Agreement is terminated by either party
pursuant to Section 11.1(c), the 6 month period referenced above shall be June
30, 2001), Seller will not (and Seller will cause each of its employees,
officers and agents not to) (a) solicit, initiate, entertain or encourage the
submission of any proposal or offer from any Person (other than Buyer) relating
to the direct or indirect acquisition of the Saumur facility and assets relating
thereto (other than in the ordinary course of business), or (b) participate in
any discussions or negotiations regarding, furnish any information with respect
to, assist or participate in, or facilitate in any other manner any effort or
attempt by any such Person to do or seek any of the foregoing. Seller will
promptly notify Buyer if any such Person makes any such proposal, offer, inquiry
or contact with respect to any of the foregoing. Notwithstanding the foregoing,
Seller, in its sole discretion, shall have the right to extend the "no shop"
provision of this Section 5.10(b) for up to one (1) year from the date hereof.
5.11 SCHEDULE UPDATES
On and after the date hereof and until five (5) Business Days prior to
the Initial Closing Date, Seller shall or may update Schedules 1.1(b), 1.1(c),
2.4(a) and 3.9(a) (in each case, only to reflect changes occurring in the
ordinary course of business in accordance with Section 5.2) and Schedule
3.4(b)(ii) (only to the extent Schedules 1.1(b), 1.1(c) or 2.4(a) are updated
pursuant to this Section 5.11).
6. CONFIDENTIAL NATURE OF INFORMATION
6.1 CONFIDENTIALITY AGREEMENT
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Buyer agrees that the Confidentiality Agreement shall apply to (a) all
documents, materials and other information that it shall have obtained regarding
Seller or its Affiliates during the course of the negotiations leading to the
consummation of the transactions contemplated hereby (whether obtained before or
after the date of this Agreement), any investigations made in connection
therewith and the preparation of this Agreement and related documents and (b)
all analyses, reports, compilations, evaluations and other materials prepared by
Buyer or its counsel, accountants or financial advisors that contain or
otherwise reflect or are based upon, in whole or in part, any of the provided
information; PROVIDED, HOWEVER, that subject to Section 6.2(a), the
Confidentiality Agreement shall terminate as of the Initial Closing and shall be
of no further force and effect thereafter with respect to information of Seller
the ownership of which is transferred to Buyer.
6.2 SELLER'S PROPRIETARY INFORMATION
(a) Except as provided in Section 6.2(b) and except as otherwise
specified in the Intellectual Property License Agreement and the EMS Agreement,
after the Initial Closing and for a period of five (5) years following the
Initial Closing Date, Buyer agrees that it will keep confidential all of
Seller's and its Affiliates' Proprietary Information that is received from, or
made available by, Seller in the course of the transactions contemplated hereby,
including, for purposes of this Section 6.2, information about Seller's and its
Affiliates' business plans and strategies, marketing ideas and concepts,
especially with respect to unannounced products and services, present and future
product plans, pricing, volume estimates, financial data, product enhancement
information, business plans, marketing plans, sales strategies, customer
information (including customers' applications and environments), market testing
information, development plans, specifications, customer requirements,
configurations, designs, plans, drawings, apparatus, sketches, software,
hardware, data, prototypes, connecting requirements or other technical and
business information, except for such Proprietary Information as is conveyed to
Buyer as part of the Purchased Assets.
(b) Notwithstanding the foregoing, such Proprietary Information
shall not be deemed confidential and Buyer shall have no obligation with respect
to any such Proprietary Information that:
(i) at the time of disclosure was already known to Buyer other
than through this transaction, free of restriction as evidenced by documentation
in Buyer's possession;
(ii) is or becomes publicly known through publication,
inspection of a product, or otherwise, and through no negligence or other
wrongful act of Buyer;
(iii) is received by Buyer from a Third Party without similar
restriction and without breach of any agreement;
(iv) to the extent it is independently developed by Buyer; or
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(v) is, subject to Section 6.2(c), required to be disclosed
under applicable Law or judicial process.
(c) If Buyer (or any of its Affiliates) is requested or required
(by oral question, interrogatory, request for information or documents,
subpoena, civil investigative demand or similar process) to disclose any
Proprietary Information, Buyer will promptly notify Seller of such request or
requirement and will cooperate with Seller such that Seller may seek an
appropriate protective order or other appropriate remedy. If, in the absence of
a protective order or the receipt of a waiver hereunder, Buyer (or any of its
Affiliates) is in the written opinion of Buyer's counsel required to disclose
the Proprietary Information, Buyer (or its Affiliate) may disclose only so much
of the Proprietary Information to the party compelling disclosure as is required
by Law. Buyer will exercise its (and will cause its Affiliates to exercise
their) reasonable commercial efforts to obtain a protective order or other
reliable assurance that confidential treatment will be accorded to such
Proprietary Information.
(d) Except to the extent that disclosure thereof is required under
accounting, stock exchange or applicable securities Law disclosure obligations,
the terms and conditions of this Agreement, and all attachments and amendments
hereto and thereto shall be considered Proprietary Information protected under
this Article 6. In addition, Buyer shall be permitted to disclose Proprietary
Information to its Affiliates and to its and their respective officers,
directors and employees and professional advisors, in each case, who have a need
to know such information for the purposes of discharging their duties to Buyer
and its Affiliates, and to its lenders and investment dealers where required to
do so under binding agreements with such Persons; PROVIDED however that Buyer
shall remain responsible for the actions of such parties with respect to such
information. Notwithstanding anything in this Article 6 to the contrary, in the
event that any such Proprietary Information is also subject to a limitation on
disclosure or use contained in another written agreement between Buyer and
Seller that is more restrictive than the limitation contained in this Article 6,
then the limitation in such agreement shall supersede this Article 6.
7. CLOSINGS
7.1 TRANSFER
(a) Subject to compliance with the terms and conditions hereof,
the transfer of the Purchased Assets (other than the Delayed Purchased Assets)
shall be deemed to take effect as at the Effective Time on the Initial Closing
Date.
(b) Subject to compliance with the terms and conditions hereof,
the transfer of the Delayed Shreveport Purchased Assets shall be effective on a
sequential basis in accordance with a timetable to be mutually agreed by Seller
and Buyer during a period of time which shall begin on the Initial Closing Date
and shall end no later than the October 1, 2001. Seller will sell, and Buyer
will purchase, the Delayed Shreveport Purchased Assets in accordance with the
following provisions: (i) Buyer shall be responsible for transporting the
Delayed Shreveport Purchased Assets from the Shreveport Premise to its facility
in Mexico, including,
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without limitation, engaging the carrier, (ii) Seller shall, at Seller's cost,
be responsible for disassembling, packing and loading such Delayed Shreveport
Purchased Asset, (iii) at the time of such disassembling, packing and loading, a
representative of Buyer shall be present to witness and confirm that such
Delayed Shreveport Purchased Assets have been disassembled, packed and loaded on
Buyer's carrier to the satisfaction of Buyer and (iv) Seller, upon receipt of
such confirmation from Buyer's representative, shall not have any further
liability for the condition of such Delayed Shreveport Purchased Asset once such
Delayed Shreveport Purchased Asset is loaded on to Buyer's carrier in accordance
with the foregoing provisions of this Section 7.1(b) and (v) Buyer shall be
responsible for making any filings with, or obtaining any consents, approvals or
authorizations from, any Governmental Body in connection with the transfer of
such Delayed Shreveport Purchased Asset to Mexico. At the Effective Time on each
Shreveport Delayed Asset Closing Date, Seller shall transfer to Buyer title to
the Delayed Shreveport Purchased Assets being transferred on such date.
(c) Subject to compliance with the terms and conditions hereof,
the transfer of the Denver and Little Rock Purchased Inventory and the
assignment and assumption of the Denver and Little Rock Purchase Orders shall be
effective on July 6, 2001 or such later date as Seller and Buyer may mutually
determine but in no event later than December 1, 2001. At the Effective Time on
the Denver and Little Rock Inventory Closing Date, Seller will transfer to Buyer
title to the Denver and Little Rock Purchased Inventory being transferred.
7.2 INITIAL CLOSING
At the Initial Closing, the following transactions shall take place:
(a) DELIVERIES BY SELLER
On the Initial Closing Date, Seller shall deliver to Buyer the
following:
(i) the Collateral Agreements;
(ii) all consents, waivers or approvals theretofore obtained
or filings made by Seller with respect to the sale of the Purchased Assets or
the consummation of the transactions contemplated by this Agreement or the
Collateral Agreements;
(iii) an opinion or opinions of Counsel for Seller dated the
Initial Closing Date with respect to the matters described in Sections 3.1, 3.3
and 3.4 (other than subparagraph (a)(ii)) in a form and subject to such
exceptions as are customary for transactions similar to those contemplated
hereby, which form shall be reasonably acceptable to Buyer;
(iv) a certificate of an appropriate officer of Seller, dated
the Initial Closing Date, certifying to the best of his or her knowledge the
fulfillment of the conditions set forth in Sections 8.1(b)(i) and (ii); and
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(v) all such other bills of sale, assignments and other
instruments of assignment, transfer or conveyance as Buyer may reasonably
request or as may be otherwise necessary to evidence and effect the sale,
transfer, assignment, conveyance and delivery of the Purchased Assets (other
than the Delayed Purchased Assets) to Buyer and to put Buyer in actual
possession or control of the Purchased Assets (other than the Delayed Purchased
Assets).
(b) DELIVERIES BY BUYER
On the Initial Closing Date, Buyer shall deliver to Seller the
following:
(i) the Purchase Price as provided in Section 2.3(a);
(ii) the Collateral Agreements;
(iii) an opinion or opinions of Counsel for Buyer (and, as
applicable, such Affiliates of Buyer to the extent such Affiliates are executing
any of the Collateral Agreements) dated the Initial Closing Date with respect to
the matters described in Sections 4.1, 4.2 and 4.3 (other than subparagraph
(a)(ii)) in a form and subject to such exceptions as are customary for
transactions similar to those contemplated hereby, which form shall be
reasonably acceptable to Seller;
(iv) a certificate of an appropriate officer of Buyer, dated
the Closing Date, certifying to the best of his or her knowledge the fulfillment
of the conditions set forth in Sections 8.1(c)(i) and (ii);
(v) all such other documents and instruments as Seller may
reasonably request or as may be otherwise necessary or desirable to evidence and
effect the assumption by Buyer of the Assumed Liabilities; and
(vi) evidence of the obtaining of, or the filing with respect
to, any required approvals set forth on SCHEDULE 4.3(b).
7.3 DELAYED CLOSINGS
At each Delayed Closing, the following transactions shall take place:
(a) DELIVERIES BY SELLER: On each Delayed Closing, Seller shall
deliver to Buyer the following:
(i) a certificate of an appropriate officer of Seller dated
such Delayed Closing Date, certifying to the best of his or her knowledge the
fulfillment of the conditions set forth in Sections 8.2(b)(i) and (ii); and
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(ii) all such other bills of sale, assignments and other
instruments of assignment, transfer or conveyance as Buyer may reasonably
request or as may be otherwise necessary to evidence the sale, transfer,
assignment, conveyance and delivery of the Delayed Purchased Assets being so
transferred on such Delayed Closing Date to Buyer and to put Buyer in actual
possession or control of such Delayed Purchased Assets.
(b) DELIVERIES BY BUYER: On each Delayed Closing, Buyer shall
deliver to Seller the following:
(i) the Purchase Price to be paid in accordance with this
Agreement in respect of the Delayed Purchased Assets being so transferred on
such Delayed Closing Date to Buyer;
(ii) a certificate of an appropriate officer of Buyer dated
such Delayed Closing Date, certifying to the best of his or her knowledge the
fulfillment of the conditions set forth in Sections 8.2(c)(i) and (ii); and
(iii) all such other documents and instruments as Seller may
reasonably request or as may be otherwise necessary or desirable to evidence and
effect the assumption by Buyer of the Assumed Liabilities on such Delayed
Closing Date.
7.4 PLACE OF CLOSINGS
Each of the Closings shall take place at the offices of Seller, ▇▇▇ ▇▇.
▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, at 10:00 a.m. local time, or at such
other place or time as Seller and Buyer may agree upon in writing.
7.5 CONTEMPORANEOUS EFFECTIVENESS
All acts and deliveries prescribed by Section 7.2 and 7.3, regardless
of chronological sequence within such Sections, will be deemed to occur
contemporaneously and simultaneously on the occurrence of the last act or
delivery required under such Sections, and none of such acts or deliveries will
be effective until the last of the same has occurred.
7.6 RISK OF LOSS FOR PURCHASED ASSETS
From the date hereof to the Effective Time on the Initial Closing Date, the
Purchased Assets to be purchased and sold on the Initial Closing Date shall be
and remain at the risk of Seller. If prior to the Effective Time on the Initial
Closing Date, any of such Purchased Assets are destroyed or damaged by fire or
any other casualty or shall be appropriated, expropriated or seized by
Governmental Body or other lawful authority, Buyer shall not be required to
complete the purchase of such Purchased Asset and shall not be required to pay
to Seller the portion of the Purchase Price attributed to such Purchased Asset.
In the event that the relevant Purchased Asset has not been destroyed or
appropriated, expropriated or seized but merely damaged and Buyer elects to
complete the purchase of such asset, the Purchase Price shall be reduced by an
amount mutually agreed by the parties or, if mutually agreed to by the
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parties, Buyer shall pay the full Purchase Price therefor and any proceeds of
insurance net of all proven expenses incurred and paid by Seller to obtain
payment of such insurance proceeds, shall be paid to Buyer, if previously
received, or assigned to Buyer, in either case, as at the Effective Time on
the Initial Closing Date.
7.7 RISK OF LOSS FOR DELAYED SHREVEPORT PURCHASED ASSET
From the date hereof to each Shreveport Delayed Asset Closing Date, the Delayed
Shreveport Purchased Assets to be purchased and sold on such Shreveport Delayed
Asset Closing Date, shall be and remain at the risk of Seller. If prior to the
Effective Time on the applicable Shreveport Delayed Asset Closing Date any
Delayed Shreveport Purchased Asset to be purchased and sold on such Shreveport
Delayed Asset Closing Date is destroyed or damaged by fire or any other casualty
or shall be appropriated, expropriated or seized by Governmental Body or other
lawful authority, Buyer shall not be required to complete the purchase of such
Delayed Shreveport Purchased Asset and shall not be required to pay to Seller
the portion of the Purchase Price attributed to such Delayed Shreveport
Purchased Asset. In the event that such Delayed Shreveport Purchased Asset has
not been destroyed or appropriated, expropriated or seized but merely damaged
and Buyer elects to complete the purchase of such asset, the Purchase Price
shall be reduced by an amount mutually agreed by the parties or, if mutually
agreed to by the parties, Buyer shall pay the full Purchase Price therefor and
any proceeds of insurance net of all proven expenses incurred and paid by Seller
to obtain payment of such insurance proceeds, shall be paid to Buyer, if
previously received, or assigned to Buyer, in either case, as at the Effective
Time on the relevant Shreveport Delayed Asset Closing Date.
8. CONDITIONS PRECEDENT TO CLOSINGS
8.1 CONDITIONS PRECEDENT TO INITIAL CLOSING
(a) GENERAL CONDITIONS: The respective obligations of Buyer and
Seller to effect the Initial Closing of the transactions contemplated hereby are
subject to the fulfillment, prior to or at the Initial Closing, of each of the
following conditions:
(i) NO INJUNCTIONS. No order of any court or administrative
agency shall be in effect that enjoins, restrains, conditions or prohibits
consummation of this Agreement or the Collateral Agreements.
(ii) ANTITRUST LAWS. Any applicable waiting period under the
HSR Act or other applicable antitrust Laws relating to the transactions
contemplated by this Agreement or the Collateral Agreements shall have expired
or been terminated.
(b) CONDITIONS PRECEDENT TO BUYER'S OBLIGATIONS: The obligations
of Buyer to effect the Initial Closing of the transactions contemplated hereby
are subject to the fulfillment, prior to or at the Initial Closing, of each of
the following conditions, any of which may be waived in writing by Buyer:
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(i) REPRESENTATIONS AND WARRANTIES OF SELLER TRUE AT INITIAL
CLOSING. The representations and warranties of Seller contained in this
Agreement or in any schedule, certificate or document delivered pursuant to the
provisions hereof or in connection with the transactions contemplated hereby (X)
which are qualified by materiality shall be true and correct, and (Y) which are
not qualified by materiality shall be true and correct in all material respects,
in each case, at and as of the Initial Closing Date, as though such
representations and warranties were made at and as of the Initial Closing Date,
except (i) as affected by the transactions contemplated hereby and (ii) to the
extent that such representations and warranties are made as of a specified date,
in which case such representations and warranties shall be true in all material
respects as of the specified date.
(ii) PERFORMANCE BY SELLER. Seller shall have performed in all
material respects all obligations and agreements and complied in all material
respects with all covenants and conditions required by this Agreement to be
performed or complied with by it prior to or at the Closing, including executing
the Collateral Agreements.
(iii) REQUIRED CONSENTS. Seller shall have obtained all of the
Required Consents, except where the failure to obtain such consents, approvals
or authorizations, individually or in the aggregate, could not reasonably be
expected to have a material adverse effect on the Business taken as a whole.
(iv) UNION AGREEMENT. The collective bargaining agreements
between Buyer and the Union covering the Transferred Represented Employees shall
have been ratified and approved by the requisite majority of the members of the
Union and executed by the Union on or before April 30, 2001.
(c) CONDITIONS PRECEDENT TO SELLER'S OBLIGATIONS: The obligations
of Seller to effect the Initial Closing of the transactions contemplated hereby
are subject to the fulfillment, prior to or at the Initial Closing, of each of
the following conditions, any of which may be waived in writing by Seller:
(i) REPRESENTATIONS AND WARRANTIES OF BUYER TRUE AT INITIAL
CLOSING. The representations and warranties of Buyer contained in this Agreement
or in any certificate or document delivered pursuant to the provisions hereof or
in connection with the transactions contemplated hereby (X) which are qualified
by materiality shall be true and correct, and (Y) which are not qualified by
materiality shall be true in all material respects, in each case, at and as of
the Initial Closing Date as though such representations and warranties were made
at and as of the Initial Closing Date, except to the extent that such
representations and warranties are made as of a specified date, in which case
such representations and warranties shall be true in all material respects as of
the specified date.
(ii) PERFORMANCE BY BUYER. Buyer shall have performed in all
material respects all obligations and agreements and complied in all material
respects with all
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covenants and conditions required by this Agreement to be performed or complied
with by it prior to or at the Initial Closing, including executing the
Collateral Agreements.
8.2 CONDITIONS PRECEDENT TO DELAYED CLOSINGS
(a) GENERAL CONDITION. The respective obligations of Buyer and
Seller to effect any Delayed Closing of the transactions contemplated hereby are
subject to the fulfillment, prior to or at the applicable Delayed Closing Date,
of the condition that no order of any court or administrative agency shall be in
effect that enjoins, restrains, conditions or prohibits the consummation of the
transaction of purchase and sale of the Delayed Purchased Assets to be purchased
and sold on such Delayed Closing Date.
(b) CONDITIONS PRECEDENT TO BUYER'S OBLIGATIONS. The obligations
of Buyer to effect any Delayed Closing of the transactions contemplated hereby
are subject to the fulfillment, prior to or at the applicable Delayed Closing
Date, of each of the following conditions, any of which may be waived in writing
by Buyer:
(i) REPRESENTATIONS AND WARRANTIES OF SELLER TRUE AT DELAYED
CLOSING. The representations and warranties of Seller contained in Sections 3.1,
3.4, 3.5, 3.6 (with respect to the second and third sentences only and assuming
that the applicable Governmental Permit was not previously assigned to Buyer and
"Business" as referenced in Section 3.6 shall mean the Business as conducted by
Seller immediately prior to the Initial Closing Date), 3.10, 3.11 (with respect
to subparagraphs (a), (b) and (c) only and without reference to "Business"
therein) and 3.15 (with respect to the first sentence only and with respect to
the Delayed Shreveport Purchased Assets only) hereof, to the extent they relate
to the Delayed Purchased Assets to be purchased and sold on such Delayed Closing
Date (X) which are qualified by materiality shall be true and correct, and (Y)
which are not qualified by materiality shall be true in all material respects,
in each case, at and as of such Delayed Closing Date except (i) as affected by
the transactions contemplated hereby and (ii) to the extent that such
representations and warranties are made as of a specified date, in which case
such representations and warranties shall be true in all material respects as of
the specified date.
(ii) PERFORMANCE BY SELLER. Seller shall have performed in all
material respects all obligations and agreements and complied in all material
respects with all covenants and conditions required by this Agreement to be
performed or complied with by it prior to or at such Delayed Closing Date,
excluding those obligations and agreements to be performed by Seller and those
covenants and conditions to be complied with by Seller at or before (and not
beyond) the Initial Closing Date.
(c) CONDITIONS PRECEDENT TO SELLER'S OBLIGATIONS. The obligations
of Seller to effect any Delayed Closing of the transactions contemplated hereby
are subject to the fulfillment, prior to or at the applicable Delayed Closing
Date, of each of the following conditions, any of which may be waived in writing
by Seller:
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CONFIDENTIAL MATERIALS OMITTED AND
FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION.
ASTERISKS DENOTE OMISSIONS.
(i) REPRESENTATIONS AND WARRANTIES OF BUYER TRUE AT DELAYED
CLOSING. The representations and warranties of Buyer contained in Sections 4.1
and 4.3(a) hereof, to the extent they relate to the Delayed Purchased Assets to
be purchased and sold on such Delayed Closing Date (X) which are qualified by
materiality shall be true and correct, and (Y) which are not qualified by
materiality shall be true in all material respects, in each case, at and as of
such Delayed Closing Date.
(ii) PERFORMANCE BY BUYER. Buyer shall have performed in all
material respects all obligations and agreements and complied in all material
respects with all covenants and conditions required by this Agreement to be
performed or complied with by it prior to or at such Delayed Closing Date,
excluding those obligations and agreements to be performed by Buyer and those
covenants and conditions to be complied with by Buyer at or before (and not
beyond) the Initial Closing Date.
9. STATUS OF AGREEMENTS
The rights and obligations of Buyer and Seller under this Agreement
shall be subject to the following terms and conditions:
9.1 EFFECT OF BREACH
In the event of a material breach of any representation, certification
or warranty, or agreement or covenant of Seller under this Agreement that is
discovered by Buyer prior to Closing and that cannot be or is not cured by
Seller upon prior notice and the passage of a reasonable period of time, Buyer
may elect not to proceed with the Closing hereunder, which shall be Buyer's sole
remedy for such breach.
9.2 SURVIVAL OF REPRESENTATIONS AND WARRANTIES
The representations and warranties of Buyer and Seller contained in
this Agreement shall survive the Initial Closing for ****; provided, (i) the
representations and warranties set out in Sections **** shall survive, with
respect to each item of Principal Equipment, Shreveport Equipment and
Purchased Inventory, for **** after the date on which such item of Principal
Equipment, Shreveport Equipment or Purchased Inventory is transferred to
Buyer in accordance with Section 7.1; (ii) the representations and warranties
set out in Sections **** and Sections **** shall survive ****; (iii) the
representations and warranties in **** shall survive for a period of ****
from the Initial Closing Date; and any claim for any breach of a
representation or warranty based on **** may be made at any time. Neither
Seller nor Buyer shall have any liability whatsoever with respect to any such
representations or warranties after the survival period for such
representation or warranty expires.
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9.3 GENERAL AGREEMENT TO INDEMNIFY
(a) Seller and Buyer shall indemnify, defend and hold harmless the
other party hereto and any director, officer or Affiliate of the other party
(each an "INDEMNIFIED PARTY") from and against any and all claims, actions,
suits, proceedings, liabilities, obligations, losses, and damages, amounts paid
in settlement, interest, costs and expenses (including reasonable attorney's
fees, court costs and other out-of-pocket expenses incurred in investigating,
preparing or defending the foregoing) (collectively, "LOSSES") incurred or
suffered by any Indemnified Party to the extent that the Losses arise by reason
of, or result from (i) the failure of any representation or warranty of such
party contained in this Agreement to have been true when made and as of the
Initial Closing Date or a Delayed Closing Date, as the case may be, except as
expressly provided otherwise in Section 8.1(b)(i), 8.1(c)(i), 8.2(b)(i) and
8.2(c)(i), or (ii) the breach by such party of any covenant or agreement of such
party contained in this Agreement to the extent not waived by the other party.
(b) Seller further agrees to indemnify and hold harmless Buyer
from and against any Losses incurred by Buyer arising out of, resulting from, or
relating to: (i) the Excluded Liabilities; (ii) Buyer's waiver of any applicable
Bulk Sales Laws; and (iii) any claim, demand or liability for the Taxes accruing
in connection with the Purchased Assets prior to and including the Initial
Closing Date. In addition, Seller agrees to indemnify and hold harmless Buyer
from and against any Losses incurred by Buyer arising out of the Cases (as
defined in Schedule 3.8(b)) described in Item 3 on Schedule 3.8(b).
(c) Buyer further agrees to indemnify and hold harmless Seller
with respect to: (i) any failure of Buyer to discharge any of the Assumed
Liabilities; and (ii) any claim, demand or liability for the Taxes referred to
in Section 2.9.
(d) Amounts payable in respect of the parties' indemnification
obligations shall be treated as an adjustment to the Purchase Price. Buyer
and Seller agree to cooperate in the preparation of a supplemental Asset
Acquisition Statement as required by Section 5.3 and Treasury Reg. Section
1.1060-1T(e)(1)(i) and (e)(1)(ii)(B) as a result of any adjustment to the
Purchase Price pursuant to the preceding sentence. Whether or not the
Indemnifying Party (as defined below) chooses to defend or prosecute any
Third-Party Claim (as defined in Section 9.4(a)) both parties hereto shall
cooperate in the defense or prosecution thereof and shall furnish such
records, information and testimony, and attend such conferences, discovery
proceedings, hearings, trials and appeals, as may be reasonably requested in
connection therewith or as provided in Section 5.1.
(e) The amount of the Indemnifying Party's liability under this
Agreement shall be determined taking into account any applicable insurance
proceeds actually received by, and other savings, including tax savings, that
actually reduce the overall impact of the Losses upon, the Indemnified Party.
The indemnification obligations of each party hereto under this Article 9 shall
inure to the benefit of the directors, officers and Affiliates of the other
party hereto on the same terms as are applicable to such other party.
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(f) The Indemnifying Party's liability for all claims made under
Section 9.3(a)(i) shall be subject to the following limitations: (i) the
Indemnifying Party shall have no liability for such claims until the aggregate
amount of the Losses incurred shall exceed 1% of the Total Aggregate Amount (the
"Threshold Amount"), in which case the Indemnifying Party shall be liable for
all Losses including the Threshold Amount, and (ii) the Indemnifying Party's
aggregate liability for all such claims shall not exceed 25% of the Total
Aggregate Amount. The Indemnified Party may not make a claim for indemnification
under Section 9.3(a)(i) for breach by the Indemnifying Party of a particular
representation or warranty after the expiration of the relevant survival period
specified in Section 9.2.
(g) The indemnification provided in this Article 9 shall be the
sole and exclusive remedy after the applicable Closing Date in respect of the
Purchased Assets transferred on such date for damages available to the parties
to this Agreement for breach of any of the terms, conditions, representations or
warranties contained herein or any right, claim or action arising from the
transactions contemplated by this Agreement; PROVIDED, HOWEVER, this exclusive
remedy for damages does not preclude a party from bringing an action for
specific performance or other equitable remedy to require a party to perform its
obligations under this Agreement or any Collateral Agreement.
(h) Notwithstanding anything contained in this Agreement to the
contrary, no party shall be liable to the other party for indirect, special,
punitive, exemplary or consequential loss or damage (including any loss of
revenue or profit) arising out of this Agreement, PROVIDED, HOWEVER, the
foregoing shall not be construed to preclude recovery by the Indemnified Party
in respect of Losses directly incurred from Third Party Claims. Both parties
shall use reasonable commercial efforts to mitigate their damages.
(i) The rights to indemnification under Section 9.3 shall not be
subject to set-off for any claim by the Indemnifying Party against any
Indemnified Party, whether or not arising from the same event giving rise to
such Indemnified Party's claim for indemnification.
9.4 GENERAL PROCEDURES FOR INDEMNIFICATION
(a) The Indemnified Party seeking indemnification under this
Agreement shall promptly notify the party against whom indemnification is sought
(the "INDEMNIFYING PARTY") of the assertion of any claim, or the commencement of
any action, suit or proceeding by any Third Party, in respect of which indemnity
may be sought hereunder and will give the Indemnifying Party such information
with respect thereto as the Indemnifying Party may reasonably request, but
failure to give such notice shall not relieve the Indemnifying Party of any
liability hereunder (unless such failure prevents the Indemnifying Party from
effectively contesting the claim in respect of which indemnification is sought).
The Indemnifying Party shall have the right, but not the obligation, exercisable
by written notice to the Indemnified Party within thirty (30) days of receipt of
notice from the Indemnified Party of the commencement of or assertion of any
claim, action, suit or proceeding by a Third Party in respect of which indemnity
may be sought hereunder (a "THIRD-PARTY CLAIM"), to assume the defense and
control the settlement of such Third-Party Claim that (i) involves (and
continues
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to involve) solely money damages or (ii) involves (and continues to involve)
claims for both money damages and equitable relief against the Indemnified Party
that cannot be severed, where the claims for money damages are the primary
claims asserted by the Third Party and the claims for equitable relief are
incidental to the claims for money damages.
(b) The Indemnifying Party or the Indemnified Party, as the case
may be, shall have the right to participate in (but not control), at its own
expense, the defense of any Third-Party Claim that the other is defending, as
provided in this Agreement.
(c) The Indemnifying Party, if it has assumed the defense of any
Third-Party Claim as provided in this Agreement, shall not consent to a
settlement of, or the entry of any judgment arising from, any such Third-Party
Claim without the Indemnified Party's prior written consent (which consent shall
not be unreasonably withheld) unless such settlement or judgment relates solely
to monetary damages. The Indemnifying Party shall not, without the Indemnified
Party's prior written consent, enter into any compromise or settlement that (i)
commits the Indemnified Party to take, or to forbear to take, any action or (ii)
does not provide for a complete release by such Third Party of the Indemnified
Party. The Indemnified Party shall have the sole and exclusive right to settle
any Third-Party Claim, on such terms and conditions as it deems reasonably
appropriate, to the extent such Third-Party Claim involves equitable or other
non-monetary relief against the Indemnified Party, and shall have the right to
settle any Third-Party Claim involving money damages for which the Indemnifying
Party has not assumed the defense pursuant to this Section 9.4 with the written
consent of the Indemnifying Party, which consent shall not be unreasonably
withheld or delayed.
(d) In the event an Indemnified Party shall claim a right to
payment pursuant to this Agreement, such Indemnified Party shall send written
notice of such claim to the Indemnifying Party. Such notice shall specify the
basis for such claim. As promptly as possible after the Indemnified Party has
given such notice, and subject to the limitations set forth in Section 9.3, the
Indemnified Party and the Indemnifying Party shall establish the merits and
amount of such claim by mutual agreement, or, if necessary, by arbitration in a
manner reasonably determined by mutual agreement of such parties.
10. MISCELLANEOUS PROVISIONS
10.1 NOTICES
All notices and other communications hereunder shall be in writing and
shall be deemed to have been duly given upon receipt if (i) mailed by certified
or registered mail, return receipt requested, (ii) sent by Federal Express or
other express carrier, fee prepaid, (iii) sent via facsimile with receipt
confirmed, or (iv) delivered personally, addressed as follows or to such other
address or addresses of which the respective party shall have notified the
other.
(a) If to Seller, to: Avaya Inc.
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Attn: Controller
▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Avaya Inc.
Attn: General Counsel
▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
(b) If to Buyer, to: Celestica Corporation
▇▇▇▇▇ International Tradeport
ATTN: EXA03
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: General Manager
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
With a copy to: Celestica Inc.
▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇
▇▇▇ ▇▇▇
Attention: Vice-President and General
Counsel
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
10.2 EXPENSES
Except as otherwise provided in this Agreement, each party to this
Agreement will bear all the fees, costs and expenses that are incurred by it in
connection with the transactions contemplated hereby, whether or not such
transactions are consummated. Seller and Buyer shall each be responsible for
their respective one-time information technology charges and one-time normal
course integration costs incurred in connection with the transactions
contemplated under this Agreement or any of the Collateral Agreements.
10.3 ENTIRE AGREEMENT; MODIFICATION
The agreement of the parties, which is comprised of this Agreement, the
Collateral Agreement, the Schedules and Exhibits hereto and the documents
referred to herein, sets forth the entire agreement and understanding between
the parties and supersedes any prior agreement or understanding, written or
oral, relating to the subject matter of this Agreement. No amendment,
supplement, modification or waiver of this Agreement shall be binding
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unless executed in writing by the party to be bound thereby, and in accordance
with Section 11.4.
10.4 ASSIGNMENT; BINDING EFFECT; SEVERABILITY
This Agreement may not be assigned by any party hereto without the
other party's written consent; PROVIDED however Buyer shall have the right to
assign this Agreement and to assign its rights and delegate its duties under
this Agreement in whole or in part at any time and without Seller's consent to
any wholly-owned subsidiary of Celestica Inc. incorporated in one of states of
the United States of America, provided that Buyer shall not, as a result of such
assignment, be discharged from its obligations hereunder. This Agreement shall
be binding upon and inure to the benefit of and be enforceable by the
successors, legal representatives and permitted assigns of each party hereto.
The provisions of this Agreement are severable, and in the event that any one or
more provisions are deemed illegal or unenforceable the remaining provisions
shall remain in full force and effect unless the deletion of such provision
shall cause this Agreement to become materially adverse to either party, in
which event the parties shall use reasonable commercial efforts to arrive at an
accommodation that best preserves for the parties the benefits and obligations
of the offending provision.
10.5 GOVERNING LAW
THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED AND INTERPRETED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK IRRESPECTIVE OF THE CHOICE OF
LAWS PRINCIPLES OF THE STATE OF NEW YORK, AS TO ALL MATTERS, INCLUDING MATTERS
OF VALIDITY, CONSTRUCTION, EFFECT, ENFORCEABILITY, PERFORMANCE AND REMEDIES.
10.6 EXECUTION IN COUNTERPARTS
This Agreement may be executed in any number of counterparts, each of
which shall be deemed an original, but all of which together shall constitute
one and the same instrument.
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10.7 PUBLIC ANNOUNCEMENT
Upon signing of this Agreement, Seller and Buyer shall prepare a
mutually agreeable release announcing the transaction contemplated hereby.
Except for such press release, neither Seller nor Buyer shall, without the
approval of the other, make any press release or other announcement concerning
the existence of this Agreement or the terms of the transactions contemplated by
this Agreement, except as and to the extent that any such party shall be so
obligated by Law, in which case the other party shall be advised and the parties
shall use their reasonable commercial efforts to cause a mutually agreeable
release or announcement to be issued; PROVIDED, HOWEVER, that the foregoing
shall not preclude communications or disclosures necessary to comply with
accounting, stock exchange or applicable securities Law disclosure obligations.
10.8 NO THIRD-PARTY BENEFICIARIES
Nothing in this Agreement, express or implied, is intended to or shall
(a) confer on any Person other than the parties hereto and their respective
successors or assigns any rights (including Third-Party beneficiary rights),
remedies, obligations or liabilities under or by reason of this Agreement or (b)
constitute the parties hereto as partners or as participants in a joint venture.
This Agreement shall not provide Third Parties with any remedy, claim,
liability, reimbursement, cause of action or other right in excess of those
existing without reference to the terms of this Agreement. Nothing in this
Agreement shall be construed as giving to any Business Employee, or any other
individual, any right or entitlement under any Benefit Plan, policy or procedure
maintained by Seller, except as expressly provided in such Benefit Plan, policy
or procedure. No Third Party shall have any rights under Section 502, 503 or 504
of ERISA or any regulations thereunder because of this Agreement that would not
otherwise exist without reference to this Agreement. No Third Party shall have
any right, independent of any right that exist irrespective of this Agreement,
under or granted by this Agreement, to bring any suit at law or equity for any
matter governed by or subject to the provisions of this Agreement.
11. TERMINATION AND WAIVER
11.1 TERMINATION
This Agreement may be terminated at any time prior to the Initial
Closing Date by:
(a) MUTUAL CONSENT. The mutual written consent of Buyer and
Seller;
(b) COURT OR ADMINISTRATIVE ORDER. Buyer or Seller if there shall
be in effect a non-appealable order of a court or government administrative
agency of competent jurisdiction prohibiting the consummation of the
transactions contemplated hereby.
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(c) DELAY. Buyer or Seller if the Initial Closing shall not have
occurred by June 30, 2001, provided that the terminating party is not otherwise
in material default or breach of this Agreement.
11.2 EFFECT OF TERMINATION
In the event of the termination of this Agreement in accordance with
Section 11.1, this Agreement shall become void and have no effect, without any
liability on the part of any party or its directors, officers or stockholders,
except for the obligations of the parties hereto as provided in Article 6,
Sections 10.2 and 10.7 and this Section 11.2.
11.3 WAIVER OF AGREEMENT
Any term or condition hereof may be waived at any time prior to the
applicable Closing Date by the party hereto which is entitled to the benefits
thereof by action taken by its Board of Directors or its duly authorized officer
or employee, whether before or after the action of such party; PROVIDED,
HOWEVER, that such action shall be evidenced by a written instrument duly
executed on behalf of such party by its duly authorized officer or employee. The
failure of either party to enforce at any time any provision of this Agreement
shall not be construed to be a waiver of such provision nor shall it in any way
affect the validity of this Agreement or the right of such party thereafter to
enforce each and every such provision. No waiver of any breach of this Agreement
shall be held to constitute a waiver of any other or subsequent breach.
11.4 AMENDMENT OF AGREEMENT
This Agreement may be amended with respect to any provision contained
herein at any time prior to or on the last Closing Date by action of the parties
hereto taken by their boards of directors or by their duly authorized officers
or employees, whether before or after such party's action; PROVIDED, HOWEVER,
that such amendment shall be evidenced by a written instrument duly executed on
behalf of each party by its duly authorized officer or employee.
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IN WITNESS WHEREOF, each party has caused this Agreement to be duly
executed on its behalf by its duly authorized officer as of the date first
written above.
AVAYA INC.
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Chief Financial Officer
CELESTICA CORPORATION
By: /s/ ▇▇▇▇▇ ▇▇▇▇
------------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇
Title: Authorized Signatory
EXHIBIT A Form of Assignment and ▇▇▇▇ of Sale
ASSIGNMENT AND ▇▇▇▇ OF SALE
FOR GOOD AND SUFFICIENT CONSIDERATION, the receipt of which is hereby
acknowledged, AVAYA INC., a Delaware corporation ("SELLER"), by these presents
GRANTS, BARGAINS, SELLS, TRANSFERS, ASSIGNS, CONVEYS AND DELIVERS to
____________________________, a _______________ corporation ("BUYER"), all
right, title and interest in and to all of the [Purchased Assets (other than the
Delayed Purchased Assets)][Delayed Purchased Assets], as that term is defined in
the Asset Purchase Agreement by and between Seller and Buyer, dated as of
February ___, 2001 (the "AGREEMENT") but excluding the Excluded Assets, in
accordance with, and subject to, the terms and conditions of the Agreement,
which are incorporated herein by reference. Capitalized terms used but not
defined herein shall have the meanings provided in the Agreement.
Seller and its successors and assigns, hereby covenants and agrees
that, at any time and from time to time forthwith upon the written request of
Buyer, Seller will execute, acknowledge and deliver or cause to be done,
executed, acknowledged and delivered, each and all of such further acts, deeds,
assignments, transfers, conveyances, powers of attorney and assurances as may
reasonably be required by Buyer or as required pursuant to the Agreement in
order to assign, transfer, set over, convey, assure and confirm unto and vest in
Buyer, its successors and assigns, title to the [Purchased Assets (other than
the Delayed Purchased Assets)][Delayed Purchased Assets] sold, assigned,
conveyed, transferred and delivered by this Assignment and ▇▇▇▇ of Sale.
This Assignment and ▇▇▇▇ of Sale is subject to the terms and conditions
of the Agreement, which are incorporated herein by reference, and shall be
binding upon Seller and Buyer, and their respective successors and assigns.
THIS ASSIGNMENT AND ▇▇▇▇ OF SALE SHALL BE GOVERNED BY AND CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK IRRESPECTIVE OF
THE CHOICE OF LAWS PRINCIPLES OF THE STATE OF NEW YORK, AS TO ALL MATTERS,
INCLUDING MATTERS OF VALIDITY, CONSTRUCTION, EFFECT, ENFORCEABILITY, PERFORMANCE
AND REMEDIES.
Date: __________ __, 2001 AVAYA INC.
By: _______________________________________
Name:
Title:
EXHIBIT B Form of Assumption Agreement
ASSUMPTION AGREEMENT
Pursuant to that certain Asset Purchase Agreement, dated as of February
__, 2001 (the "AGREEMENT"), by and between AVAYA INC., a Delaware corporation
("SELLER"), and ___________________________, a ___________ corporation
("BUYER"), FOR GOOD AND SUFFICIENT CONSIDERATION, the receipt of which is hereby
acknowledged, Buyer hereby ACCEPTS, ASSUMES AND AGREES TO PAY, PERFORM OR
OTHERWISE DISCHARGE the Assumed Liabilities [(other than the Assumed Liabilities
related to the Shreveport Contracts and Licenses and/or the Denver and Little
Rock Purchase Orders)][related to the Shreveport Contracts and Licenses and/or
the Denver and Little Rock Purchase Orders], but excluding the Excluded
Liabilities, in accordance with, and subject to, the terms and conditions of the
Agreement, which are incorporated herein by reference. Capitalized terms used
but not defined herein shall have the meanings provided in the Agreement.
This Assumption Agreement is subject to the terms and conditions of the
Agreement, which are incorporated herein by reference, and shall be binding upon
Seller and Buyer, and their respective successors and assigns.
THIS ASSUMPTION AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK IRRESPECTIVE OF
THE CHOICE OF LAWS PRINCIPLES OF THE STATE OF NEW YORK, AS TO ALL MATTERS,
INCLUDING MATTERS OF VALIDITY, CONSTRUCTION, EFFECT, ENFORCEABILITY, PERFORMANCE
AND REMEDIES.
Date: __________ __, 2001 [BUYER]
By: _______________________________________
Name:
Title: