STOCK PURCHASE AGREEMENT
dated August 7, 1996, among
▇▇▇▇▇▇ MANUFACTURING INC.,
THE SHAREHOLDERS OF ▇▇▇▇▇▇ MANUFACTURING INC.,
and
OSHKOSH TRUCK CORPORATION
TABLE OF CONTENTS
Page
ARTICLE I - Purchase and Sale of Stock . . . . . . . . . . . . . . . 1
1.1. Purchase of Stock . . . . . . . . . . . . . . . . . . . . 1
1.2. Purchase Price; Payment . . . . . . . . . . . . . . . . . 1
ARTICLE II - Conditions Precedent to Closing . . . . . . . . . . . . 2
2.1. Conditions Precedent to the Buyer's Obligation . . . . . . 2
2.2. Conditions Precedent to the Company's and the Sellers'
Obligation . . . . . . . . . . . . . . . . . . . . . . . . 4
ARTICLE III - Closing . . . . . . . . . . . . . . . . . . . . . . . . 5
3.1. Time and Place of Closing . . . . . . . . . . . . . . . . 5
3.2. Deliveries of the Buyer . . . . . . . . . . . . . . . . . 5
3.3. Deliveries of the Company and the Sellers . . . . . . . . 6
ARTICLE IV - Warranties and Representations of the Sellers . . . . . 7
4.1. Individual Warranties and Representations of the Sellers . 7
4.1.1. Title to Shares . . . . . . . . . . . . . . . . . 7
4.1.2. Authority . . . . . . . . . . . . . . . . . . . . 7
4.1.3. Stockholder Agreements . . . . . . . . . . . . . 9
4.2. Warranties and Representations of the Company . . . . . . 10
4.2.1. Organization and Standing . . . . . . . . . . . . 10
4.2.2. Capitalization . . . . . . . . . . . . . . . . . 10
4.2.3. Authorization; No Violations . . . . . . . . . . 11
4.2.4. Litigation and Compliance with Laws . . . . . . . 12
4.2.5. Subsidiaries, Investments . . . . . . . . . . . . 13
4.2.6. Ownership and Use of Tangible Assets . . . . . . 13
4.2.7. Patents, Trademarks, and Other Intellectual
Property. . . . . . . . . . . . . . . . . . . . . 15
4.2.8. Financial Statements . . . . . . . . . . . . . . 15
4.2.9. Conduct Out of Ordinary Course . . . . . . . . . 16
4.2.10. Taxes . . . . . . . . . . . . . . . . . . . . . . 17
4.2.11. Contracts and Other Agreements . . . . . . . . . 18
4.2.12. Product Warranty and Product Liability . . . . . 20
4.2.13. Employee Benefit Matters . . . . . . . . . . . . 20
4.2.14. Labor Practices . . . . . . . . . . . . . . . . . 22
4.2.15. Brokers; Agents . . . . . . . . . . . . . . . . . 22
4.2.16. Permits and Licenses . . . . . . . . . . . . . . 22
4.2.17. Major Customers . . . . . . . . . . . . . . . . . 23
4.2.18. Dealers and Other Agents . . . . . . . . . . . . 23
4.2.19. Material Suppliers of Inventories . . . . . . . . 24
4.2.20. Insurance . . . . . . . . . . . . . . . . . . . . 24
4.2.21. Environmental Matters . . . . . . . . . . . . . . 25
4.2.22. Bank Accounts . . . . . . . . . . . . . . . . . . 27
4.2.23. Inventory . . . . . . . . . . . . . . . . . . . . 27
4.2.24. Accounts Receivable . . . . . . . . . . . . . . . 27
4.3. Warranties Survive Closing . . . . . . . . . . . . . . . . 27
4.4. Knowledge . . . . . . . . . . . . . . . . . . . . . . . . 28
ARTICLE V - Warranties and Representations of the Buyer . . . . . . . 28
5.1. Warranties and Representations . . . . . . . . . . . . . . 28
5.1.1. Authority . . . . . . . . . . . . . . . . . . . . 28
5.1.2. Investment Representations . . . . . . . . . . . 29
5.1.3. Brokers; Agents . . . . . . . . . . . . . . . . . 30
5.1.4. Guarantees . . . . . . . . . . . . . . . . . . . 30
5.2. Warranties Survive Closing . . . . . . . . . . . . . . . . 30
ARTICLE VI - Covenants . . . . . . . . . . . . . . . . . . . . . . . 30
6.1. Covenants of the Company. . . . . . . . . . . . . . . 30
6.1.1. Access . . . . . . . . . . . . . . . . . . . . . 30
6.1.2. Records . . . . . . . . . . . . . . . . . . . . . 31
6.1.3. Conduct of the Business of the Company and its
Subsidiaries . . . . . . . . . . . . . . . . . . 31
6.1.4. Title Insurance . . . . . . . . . . . . . . . . . 33
6.1.5. Surveys . . . . . . . . . . . . . . . . . . . . . 33
6.1.6. Tax Matters . . . . . . . . . . . . . . . . . . . 34
6.1.7. Bonuses . . . . . . . . . . . . . . . . . . . . . 34
6.2. Covenants of the Sellers . . . . . . . . . . . . . . . . . 34
6.2.1. Solicitation . . . . . . . . . . . . . . . . . . 34
6.2.2. Stock Transfer . . . . . . . . . . . . . . . . . 34
6.2.3. Delivery of Documents . . . . . . . . . . . . . . 34
6.3. Mutual Covenants . . . . . . . . . . . . . . . . . . . . . 35
6.3.1. Cooperation . . . . . . . . . . . . . . . . . . . 35
6.3.2. Records . . . . . . . . . . . . . . . . . . . . . 35
6.3.3. Publicity . . . . . . . . . . . . . . . . . . . . 35
6.3.4. Execution of Additional Documents . . . . . . . . 36
6.3.5. Reasonable Efforts . . . . . . . . . . . . . . . 36
6.4. Covenants of the Buyer . . . . . . . . . . . . . . . . . . 36
6.4.1. Severance Payments . . . . . . . . . . . . . . . 36
6.4.2. Incentive Compensation Plan . . . . . . . . . . . 36
6.4.3. Other Benefits . . . . . . . . . . . . . . . . . 37
ARTICLE VII - Disclosure Schedule . . . . . . . . . . . . . . . . . . 37
7.1. General . . . . . . . . . . . . . . . . . . . . . . . . . 37
7.2. Updates to Disclosure Schedule . . . . . . . . . . . . . . 37
ARTICLE VIII - Non-Disclosure . . . . . . . . . . . . . . . . . . . . 38
8.1. Non-Disclosure of Confidential Information . . . . . . . . 38
8.2. Enforcement . . . . . . . . . . . . . . . . . . . . . . . 38
ARTICLE IX - Indemnification . . . . . . . . . . . . . . . . . . . . 39
9.1. Indemnification of the Buyer . . . . . . . . . . . . . . . 39
9.2. Indemnification of the Sellers . . . . . . . . . . . . . . 40
9.3. Procedure Relative to Indemnification . . . . . . . . . . 40
9.4. Effect of Taxes, Other Benefits and Insurance . . . . . . 42
9.5. Limits on Indemnification Claims . . . . . . . . . . . . . 42
9.5.1. Basket . . . . . . . . . . . . . . . . . . . . . 42
9.5.2. Maximum Amount of Indemnification . . . . . . . . 42
9.6. Sole Remedy; Termination . . . . . . . . . . . . . . . . . 43
9.7. No Indemnification for Known Breaches of Representations and
Warranties . . . . . . . . . . . . . . . . . . . . . . . . 43
ARTICLE X - Termination . . . . . . . . . . . . . . . . . . . . . . . 44
10.1. Termination . . . . . . . . . . . . . . . . . . . . . . . 44
10.2. Effect of Termination . . . . . . . . . . . . . . . . . . 44
ARTICLE XI - Miscellaneous . . . . . . . . . . . . . . . . . . . . . 45
11.1. Expenses . . . . . . . . . . . . . . . . . . . . . . . . . 45
11.2. Notices . . . . . . . . . . . . . . . . . . . . . . . . . 45
11.3. Entire Agreement . . . . . . . . . . . . . . . . . . . . . 46
11.4. Assignment . . . . . . . . . . . . . . . . . . . . . . . . 46
11.5. Binding Effect . . . . . . . . . . . . . . . . . . . . . . 47
11.6. Paragraph Headings . . . . . . . . . . . . . . . . . . . . 47
11.7. Severability . . . . . . . . . . . . . . . . . . . . . . . 47
11.8. Applicable Law . . . . . . . . . . . . . . . . . . . . . . 47
11.9. Counterparts . . . . . . . . . . . . . . . . . . . . . . . 47
11.10. Passage of Title . . . . . . . . . . . . . . . . . . . . . 47
11.11. Use of Terms . . . . . . . . . . . . . . . . . . . . . . . 47
LIST OF SCHEDULES AND EXHIBITS*
Schedule 1 Schedule of Stock Ownership/Payment of Purchase Price
Schedule 2 Disclosure Schedule
Exhibit 6.1.7 Bonus Plan
Exhibit 6.3.3 Form of Announcement and Press Release Regarding Sale
of the Company
Exhibit 6.4.1 Management Employees With Six Month Severance
Exhibit 6.4.2 Incentive Compensation Plan
* Such schedules and exhibits are not filed herewith. Oshkosh Truck
Corporation agrees to furnish supplementally a copy of any such omitted
schedule or exhibit to the Commission upon request.
STOCK PURCHASE AGREEMENT
THIS AGREEMENT is made and entered into as of August 7, 1996, by
and among ▇▇▇▇▇▇ MANUFACTURING INC., a Wisconsin corporation (the
"Company"), all of the SHAREHOLDERS OF THE COMPANY, each of which is
listed on Schedule 1 attached hereto (individually a "Seller";
collectively, the "Sellers") and OSHKOSH TRUCK CORPORATION, a Wisconsin
corporation (the "Buyer").
BACKGROUND
The Sellers own collectively all of the issued and outstanding
shares of Five Cent ($.05) par value Common Stock (the "Common Stock") of
the Company. The Sellers desire to sell to the Buyer, and the Buyer
desires to purchase from the Sellers, all of the issued and outstanding
shares of Common Stock, upon the terms and conditions set forth herein.
NOW, THEREFORE, the Buyer, the Sellers and the Company, in
consideration of the mutual promises hereinafter set forth, do hereby
promise and agree as follows:
ARTICLE I
Purchase and Sale of Stock
1.1. Purchase of Stock. Subject to the terms and conditions set
forth in this Agreement, the Sellers shall sell to the Buyer, and the
Buyer shall purchase from the Sellers at the Closing (as hereinafter
defined), all of the issued and outstanding shares of capital stock of the
Company, consisting of Four Hundred Ten Thousand Seventy-Nine (410,079)
shares of Common Stock (collectively, the "Subject Shares"). The number
and percentage of the Subject Shares to be transferred by each Seller
shall be as set forth opposite such Seller's name on Schedule 1 attached
hereto.
1.2. Purchase Price; Payment. The purchase price for the Subject
Shares (the "Purchase Price") shall be Three Hundred Ninety-Two and
6,073/10,000 Dollars ($392.6073) per share for an aggregate amount of One
Hundred Sixty-One Million Dollars ($161,000,000.00); provided, however,
that the aggregate Purchase Price shall not change based on the issuance
by the Company of shares pursuant to options, stock appreciation rights or
other commitments which increase the number of Subject Shares prior to the
Closing and provided, further, that the aggregate Purchase Price and the
resulting proportionate per share amount shall be reduced by the aggregate
After Tax Bonus Amount (as defined in Paragraph 6.1.7). At the Closing,
the Buyer shall pay the Purchase Price by wire transfer of immediately
available funds to the Sellers in the amounts and per the wire transfer
instructions set forth on Schedule 1 attached hereto.
ARTICLE II
Conditions Precedent to Closing
2.1. Conditions Precedent to the Buyer's Obligation. The
obligation of the Buyer to consummate the transactions contemplated herein
is subject to the satisfaction as of the Closing of each of the following
conditions:
(a) Each of the representations and warranties of the Sellers
made in this Agreement and the statements contained in the Disclosure
Schedule and Attachments thereto shall be true and correct in all
material respects when made and on and as of the Closing Date (as
hereinafter defined), as though made on and as of the Closing Date,
except as amended by the Sellers prior to the Closing as provided in
Article VII, below or by the terms of this Agreement or consented to in
writing by the Buyer; the Company and the Sellers shall have performed
in all material respects the respective covenants, agreements or
obligations of the Company and the Sellers contained in this Agreement
required to be performed on or prior to the Closing Date; and the
Company and the Sellers shall have delivered to the Buyer a certificate
dated as of the Closing Date and signed by the President on behalf of
the Company, and by the Sellers confirming the foregoing. The
statements in such certificate shall be a warranty of the Sellers for
purposes of this Agreement, which warranty shall be subject to the
provisions of Paragraphs 4.3 and 4.4, below.
(b) The Company or its ultimate parent entity, as the case
may be, shall have filed, if required by law, proper pre-merger
notification forms with the United States Federal Trade Commission (the
"FTC") and the Antitrust Division of the United States Department of
Justice (the "DOJ") under the ▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Antitrust Improvements
Act of 1976, as amended, and the rules and regulations promulgated
thereunder (the "HSR Act"), and the waiting period following the filing
of proper pre-merger notification forms by the Buyer (or its ultimate
parent entity) and the Company (or its ultimate parent entity) shall
have expired, whether pursuant to early termination or by passage of
time.
(c) All material consents, licenses, permits, authorizations
or approvals from, filings with and notifications to any federal, state,
local or other governmental or regulatory body required to be made or
obtained by the Company and the Sellers in connection with the
consummation of the transactions contemplated by this Agreement or
necessary to operate the Company which are specifically noted in the
Disclosure Schedule (as hereinafter defined) shall have been made or
obtained including, without limitation, requirements under the HSR Act
as contemplated by Paragraph 2.1(b), above. All material approvals,
consents and waivers of third parties required to be obtained by the
Company and the Sellers (as specifically noted in the Disclosure Sched-
ule in connection with the consummation of such transactions) shall have
been obtained.
(d) No injunction or order of any court or administrative
agency of competent jurisdiction shall be in effect as of the Closing
which restrains or prohibits the consummation of the transactions
contemplated by this Agreement nor shall any action, suit or proceeding
requesting such an injunction or order have been commenced or threatened
by a party other than the Buyer.
(e) The Company and the Sellers shall have delivered to the
Buyer the documents, certificates, agreements and instruments required
under Paragraph 3.3, below.
(f) The Buyer shall have obtained good and valid title
insurance policies or, in final form, irrevocable title insurance
commitments serving as the title insurance policies, dated as of the
Closing Date, conforming to the specifications set forth in Paragraph
6.1.4 hereof, and surveys conforming to the specifications set forth in
Paragraph 6.1.5 hereof.
(g) Since the date of the Interim Balance Sheet (as defined
in Paragraph 4.2.8) no event or circumstance shall have occurred or be
in effect which has or is reasonably likely to have a Material Adverse
Effect (as defined in Paragraph 4.2.3); provided, however, that for
purposes of this clause (g), any change in management or other employees
of the Company will not be deemed to have or be reasonably likely to
result in a Material Adverse Effect.
In the event that any of the foregoing conditions to the Closing
shall not have been satisfied prior to October 31, 1996, the Buyer may
elect to (i) terminate this Agreement without liability to the Buyer,
provided that any such termination shall be without prejudice to any
claims by the Buyer for intentional breach of this Agreement by the
Company or the Sellers; or (ii) waive all such unsatisfied conditions and
consummate the transactions contemplated herein despite such failure.
2.2. Conditions Precedent to the Company's and the Sellers'
Obligation. The obligation of the Company and the Sellers to consummate
the transactions contemplated herein is subject to the satisfaction as of
the Closing of each of the following conditions:
(a) Each of the representations and warranties of the Buyer
made in this Agreement shall be true and correct in all material
respects when made and on and as of the Closing Date, as though made on
and as of the Closing Date; the Buyer shall have performed in all
material respects the covenants, agreements and obligations of the Buyer
contained in this Agreement required to be performed on or prior to the
Closing; and the Buyer shall have delivered to the Sellers a certificate
dated as of the Closing Date and signed by an authorized officer of the
Buyer confirming the foregoing. The statements made in such certificate
shall be a warranty of the Buyer for purposes of this Agreement, which
warranty shall be subject to the provisions of Paragraph 5.2, below.
(b) The Buyer shall have caused its ultimate parent entity to
file, if required by law, proper pre-merger notification forms with the
FTC and the DOJ under the HSR Act, and the waiting period following the
filing of proper pre-merger notification forms by the Buyer and the
Company (or its ultimate parent entity) shall have expired, whether
pursuant to early termination or by passage of time.
(c) All consents, licenses, permits, authorizations,
approvals from, filings with and notifications to any federal, state,
local or other governmental or regulatory body required to be made or
obtained by the Buyer in connection with the consummation of the
transactions contemplated by this Agreement shall have been made or
obtained including, without limitation, requirements under the HSR Act
as contemplated by Paragraph 2.2(b), above. All consents of third
parties required to be obtained by the Buyer in connection with the
consummation of such transactions shall have been obtained.
(d) All management and employee bonuses for the current year
through the date of the Closing and projected to year-end shall have
been paid and all stock appreciation rights and other similar benefits
as described on the Disclosure Schedule shall have been or be paid at or
prior to Closing as if fully vested on Closing and the bonuses referred
to in Paragraph 6.1.7 shall have been paid at or simultaneously with the
Closing.
(e) All guarantees of Company obligations by any Seller to
United States Fidelity and Guaranty Company ("USF&G") shall be released
as of Closing.
(f) No injunction or order of any court or administrative
agency of competent jurisdiction shall be in effect as of the Closing
which restrains or prohibits the consummation of the transactions
contemplated under this Agreement nor shall any action, suit or
proceeding requesting such an injunction or order have been commenced or
threatened by a party other than Sellers or the Company.
(g) The Buyer shall have delivered to the Sellers the
documents, certificates, agreements and instruments required under
Paragraph 3.2, below.
In the event that any of the foregoing conditions to the Closing
shall not have been satisfied prior to October 31, 1996, the Sellers may
elect to (i) terminate this Agreement without liability to the Sellers,
provided that any such termination shall be without prejudice to any
claims by the Company or the Sellers for intentional breach of this
Agreement by the Buyer; or (ii) waive any such unsatisfied conditions and
consummate the transactions contemplated herein despite such failure.
ARTICLE III
Closing
3.1. Time and Place of Closing. The closing of the purchase and
sale contemplated herein (the "Closing") shall be held at the offices of
▇▇▇▇▇▇▇ & ▇▇▇▇, S.C., in Appleton, Wisconsin, at 10:00 AM local time, on
September 16, 1996, or at such other time or place as the Company, the
Sellers and the Buyer shall mutually agree. The date on which the Closing
shall occur is hereinafter referred to as the "Closing Date."
3.2. Deliveries of the Buyer. At the Closing, the Buyer shall
deliver to the Sellers the following:
(a) The payment of the Purchase Price in the manner specified
in Paragraph 1.2, above.
(b) A certificate from the Secretary of the Buyer, in a form
reasonably satisfactory to the Sellers and their counsel, setting forth
the resolutions of the Board of Directors of the Buyer authorizing the
execution of this Agreement, all agreements, documents and instruments
to be executed by the Buyer in connection herewith (the "Buyer Ancillary
Documents") and the taking of any and all actions deemed necessary or
advisable to consummate the transactions contemplated herein or therein.
(c) The certificate of the Buyer required to be delivered
pursuant to Paragraph 2.2(a), above.
3.3. Deliveries of the Company and the Sellers. At the Closing,
the Company and the Sellers shall deliver to the Buyer the following:
(a) Certificates representing the Subject Shares, duly
endorsed in blank or accompanied by stock powers duly executed in blank
by the Sellers.
(b) The certificate of the Company and the Sellers required
to be delivered pursuant to Paragraph 2.1(a), above.
(c) Resignations of the President of the Company in his
capacity as a statutory officer and of all of the directors of the
Company and each person who is a trustee, custodian, or authorized
signatory under any employee benefit plan, bank account, depository
account or safe deposit box of the Company, effective as of the Closing,
as designated by the Buyer.
(d) Constructive possession of the complete books and records
relating to the business of the Company including, without limitation,
minute books, stock ledgers, all keys or articles required for access
thereto and the combinations for all safes, vaults and other places of
safekeeping or storage of the Company.
(e) A certificate of each of the Sellers, in a form
reasonably satisfactory to the Buyer and its counsel, certifying that
such Seller is not a "foreign person" within the meaning of Section 1445
of the Internal Revenue Code of 1986, as amended (the "Code").
(f) Documentary evidence reasonably satisfactory to the Buyer
and its counsel as to the termination of the Stockholder Agreements (as
hereinafter defined).
(g) A certificate of the Secretary of the Company, in a form
reasonably satisfactory to the Buyer and its counsel, setting forth the
resolutions of the Board of Directors of the Company authorizing the
execution of this Agreement and all agreements, documents and
instruments to be delivered by the Company or any of the Sellers
hereunder (collectively the "Seller Ancillary Documents") which will be
executed by the Company in connection herewith and the taking by the
Company of any and all actions deemed necessary or advisable to
consummate the transactions contemplated herein or therein.
ARTICLE IV
Warranties and Representations of the Sellers
4.1. Individual Warranties and Representations of the Sellers.
Except as set forth in the disclosure schedule attached hereto as Schedule
2 (hereinafter the "Disclosure Schedule") each of the Sellers hereby
individually, but only with respect to the Subject Shares owned by such
Seller and the authority of such Seller to consummate the transactions
contemplated hereby, warrants and represents to the Buyer, which
warranties and representations shall survive the Closing for the period
set forth in Paragraph 4.3, below, and shall be subject to the provisions
of Paragraph 4.4, below, as follows:
4.1.1. Title to Shares. Such Seller is the record owner of and
has good, valid and marketable title to the respective number of the
Subject Shares set forth opposite his, her or its name on Schedule 1
attached hereto, and at the Closing will deliver to the Buyer good, valid
and marketable title to such shares free and clear of all liens, security
interests, claims, options, charges, pledges and encumbrances of any kind
whatsoever, except as otherwise provided herein or in the Stockholder
Agreements (as hereinafter defined) or in Section 180.0622(2)(b) of the
Wisconsin Statutes and the cases decided thereunder.
4.1.2. Authority.
(a) Such Seller has full right, power, legal capacity and
authority to sell, transfer and deliver to the Buyer the full legal and
beneficial ownership in the portion of Subject Shares to be sold by such
Seller pursuant to this Agreement and to consummate the transactions
contemplated herein and in any of the Seller Ancillary Documents to
which such Seller is a party.
(b) If such Seller is a corporation, partnership or limited
liability company, such Seller is duly organized and validly existing
under the laws of its jurisdiction of organization, has the corporate or
other appropriate power and authority to enter into this Agreement and
the Seller Ancillary Agreements to which such Seller is a party and to
consummate the transactions contemplated hereby and thereby, and the
execution and delivery of this Agreement and the Seller Ancillary Docu-
ments to which such Seller is a party and the consummation of the
transactions contemplated hereby and thereby by such Seller have been
approved by all necessary action on behalf of such Seller.
(c) If such Seller is a trust or a charitable foundation (a
"Trust"): (i) the trustees or other fiduciaries thereof who have signed
this Agreement (and any relevant Seller Ancillary Document) on behalf of
such Trust are the duly appointed trustees, fiduciaries or other repre-
sentatives of such Trust and they have not resigned or been removed or
replaced from such positions as of the date hereof; (ii) no beneficiary
or other remainderman of such Trust has heretofore in any way assigned,
transferred, or encumbered, or permitted the assignment, transfer or
other encumbrance of the Subject Shares held by such Trust; (iii) the
execution and delivery of this Agreement and any relevant Seller
Ancillary Document by such trustees or fiduciaries and the performance
by such trustees or fiduciaries of their obligations hereunder and
thereinafter have been duly and validly authorized and approved by all
actions required under applicable law relating to such Trust and under
the terms of the relevant instruments governing such Trust; and (iv)
such trustees and other fiduciaries have full power and authority under
the terms of the applicable instruments governing such Trust and under
any document relating to or applicable to such Trust to execute and
deliver this Agreement and any relevant Seller Ancillary Document on
behalf of such Trust and to perform their respective obligations
hereunder.
(d) This Agreement has been duly and validly executed and
delivered by such Seller and is the legal, valid and binding obligation
of such Seller enforceable in accordance with its terms except as
enforceability may be limited by bankruptcy, insolvency, fraudulent
conveyance, moratorium, reorganization and other laws generally affect-
ing the rights of creditors and general principles of equity and
applicable federal or state laws which may affect the availability of
equitable remedies. No action, consent or approval by or filing with
any federal, state, municipal, foreign or other court or governmental or
administrative body or agency or any other regulatory or self-regulatory
body is required in connection with the execution and delivery by such
Seller of this Agreement or the Seller Ancillary Documents to the extent
such Seller is a party thereto or the consummation by such Seller of the
transactions contemplated hereby and thereby other than the pre-merger
notification with the FTC and the DOJ under the HSR Act, except for any
action, consent or approval, with respect to which a failure to obtain
would not reasonably be expected to impair in any material respect the
performance by such Seller of such Seller's obligations hereunder. No
claim, action, suit, proceeding, arbitration, investigation or inquiry
before any federal, state, municipal, foreign or other court or
governmental or administrative body or agency, any securities or
commodities exchange or any private arbitration tribunal is now pending
or, to the knowledge of such Seller, threatened, against or relating to
such Seller which would have a material adverse effect on the ability of
such Seller to consummate the sale of the Subject Shares or the other
transactions contemplated by this Agreement or the Seller Ancillary
Documents. Neither the execution and delivery by such Seller of this
Agreement or any Seller Ancillary Document to which such Seller is a
party, nor the consummation of the transactions contemplated hereby and
thereby, will breach, violate or constitute an event of default (or an
event which with the lapse of time or the giving of notice or both would
constitute an event of default) under, give rise to any right of
termination, cancellation, modification or acceleration under, or
require any consent or the giving of any notice under, any contract or
instrument to which such Seller is a party or by which any of such
Seller's Subject Shares may be bound, except as provided in the
Stockholder Agreements and except for such breaches, violations or
defaults which would not reasonably be expected to impair in any
material respect the performance by such Seller of such Seller's
obligations hereunder.
4.1.3. Stockholder Agreements. Except for this Agreement, the
Seller Ancillary Documents, that certain Shareholders Agreement dated
September 16, 1987, amended most recently on April 19, 1996 and July 1,
1996 (the "Shareholders Agreement"), that certain Directors Stock
Subscription Agreement dated May 26, 1993, amended most recently on April
19, 1996 (the "Directors Stock Subscription Agreement"), and that certain
Key Employee Stock Subscription Agreement dated May 25, 1993, amended most
recently on April 19, 1996 (the "Key Employee Stock Subscription Agree-
ments," and with the Shareholders Agreement and the Directors Stock
Subscription Agreement being collectively referred to as "the Stockholder
Agreements"), there are no voting trust agreements, powers of attorney,
proxies or any other contracts, agreements, arrangements, commitments,
plans or understandings, written or oral, restricting or otherwise
relating to the voting, dividend rights or disposition of that portion of
the Subject Shares owned by such Seller or otherwise granting any person
any right in respect of that portion of the Subject Shares owned by such
Seller and no restrictions on the transfer of such portion of the Subject
Shares presently exist.
4.2. Warranties and Representations of the Company. Except as set
forth in the Disclosure Schedule, the Company hereby warrants and
represents to the Buyer, which warranties and representations shall
survive the Closing for the period set forth in Paragraph 4.3, below, and
shall be subject to the provisions of Paragraph 4.4, below, as follows:
4.2.1. Organization and Standing. The Company is a corporation
duly organized and validly existing under the laws of the State of
Wisconsin. Each corporation, partnership, joint venture or other
business entity in which the Company maintains a majority voting interest
(each, a "Subsidiary"; collectively, the "Subsidiaries") is set forth in
the Disclosure Schedule and is a corporation duly organized and validly
existing under the laws of its state or other jurisdiction of
incorporation. The Company has the power and authority to own or lease
its properties and to carry on all business activities which it now
conducts. The Disclosure Schedule contains a true, complete and correct
list of all states in which the Company and each Subsidiary is qualified
to do business as a foreign corporation. The stock certificate, transfer
books and minute books of the Company and each Subsidiary (a copy of which
has been made available for inspection by the Buyer and its representa-
tives) are materially true and complete. The Articles of Incorporation
and By-Laws or other constituent documents of the Company and each
Subsidiary (true and complete copies of which have been provided to the
Buyer) are true, complete and correct and are in full force and effect
without amendment or modification.
4.2.2. Capitalization. The entire duly authorized capital stock
of the Company consists of Four Hundred Forty-Two Thousand (442,000)
shares of Common Stock, of which Four Hundred Ten Thousand Seventy-Nine
(410,079) shares are currently issued and outstanding. All of the Subject
Shares are fully paid and nonassessable, except as provided in Section
180.0622 of the Wisconsin Statutes and cases decided thereunder. The
Subject Shares have not been issued in violation of, and are not subject
to, any preemptive or subscription rights other than as provided in the
Stockholder Agreements. Other than the Stockholder Agreements and the
items described in the Disclosure Schedule, there are no outstanding
warrants, options, agreements, subscriptions, convertible or exchangeable
securities or other commitments or rights pursuant to which the Company is
or may become obligated to issue, sell, purchase, return or redeem any
shares of capital stock or other securities of the Company. All of the
Subject Shares have been issued in material compliance with all applicable
federal and state securities laws or in accordance with exemptions
therefrom. The Subject Shares constitute all of the issued and
outstanding shares of capital stock of the Company of whatever class,
series or designation. Schedule 1 hereto contains a complete and correct
list of all holders of any class of capital stock or other securities of
the Company.
4.2.3. Authorization; No Violations.
(a) The Company has full corporate power and authority to
execute, deliver and perform this Agreement and the other documents and
instruments to be executed and delivered by the Company pursuant hereto.
The execution and delivery of this Agreement by the Company and the
consummation by the Company of the transactions contemplated hereby have
been duly approved by the Board of Directors of the Company, and no
other corporate action on the part of the Company is necessary to
authorize and approve the Company's execution and delivery of this
Agreement or its consummation of the transactions contemplated hereby.
This Agreement has been, and when executed and delivered by the Company,
the other documents and instruments to be executed and delivered by the
Company will be, duly executed and delivered by the Company, and
constitutes, or will constitute valid and legally binding agreements of
the Company enforceable in accordance with its terms, except that the
enforceability of this Agreement may be limited by bankruptcy,
insolvency, fraudulent conveyance, moratorium, reorganization and other
laws generally affecting the rights of creditors and general principles
of equity and applicable federal or state laws which may affect the
availability of equitable remedies.
(b) Except for the requirements of the HSR Act, or except as
otherwise disclosed in the Disclosure Schedule, the execution, delivery
and performance of this Agreement by the Company and the consummation of
the transactions contemplated hereby will not: (i) violate or conflict
with any provision of the Articles of Incorporation, By-Laws or other
constituent documents of the Company or any Subsidiary, (ii) breach,
violate or (whether immediately or with the lapse of time or the giving
of notice or both) constitute an event of default under or an event
which would give rise to any right of termination, cancellation,
modification, acceleration or foreclosure under, or require any consent
of or the giving of any notice to any third party under, any note, bond,
indenture, credit facility, mortgage, security agreement, lease,
license, franchise, permit or other agreement, instrument or obligation
to which the Company or any Subsidiary is a party, or by which the
Company or any Subsidiary, or any of their respective material prop-
erties or assets may be bound, or give rise to the creation of any
pledge, lien, claim, charge, security interest or other encumbrance upon
the properties or assets of the Company or any Subsidiary, or give rise
to the creation of any pledge, lien, claim, charge, security interest or
other encumbrance on the Subject Shares except in each case for any
matter which would not have a Material Adverse Effect (the term
"Material Adverse Effect" when used in this Agreement shall mean having
such effect as described in the context of the reference either (i)
individually or (ii) in the aggregate when such individual events or
circumstances are based on or arise from or are related to the same or
substantially similar underlying facts which would have a material
adverse effect on the business, properties or financial condition of the
Company and its Subsidiaries taken as a whole), (iii) violate or
conflict with any law, statute, rule, regulation, ordinance, code,
judgement, order, writ, injunction, decree, determination, award or
other requirement of any court or of any governmental body or agency
thereof applicable to the Company or any Subsidiary or by which any of
their respective properties or assets may be bound, except for any
violation or conflict which would not have a Material Adverse Effect, or
(iv) require any registration or filing by the Company, any Subsidiary
or any of the Sellers with, or any permit, license, exemption, consent,
authorization or approval of, or the giving of any notice by the
Company, any Subsidiary, or any of the Sellers to, any governmental or
regulatory body, agency or authority, except where the failure to make
such registration or filing or obtain such permit, license, exemption,
consent, authorization or approval, or to give such notice would not
have a Material Adverse Effect.
4.2.4. Litigation and Compliance with Laws. Except as described
in the Disclosure Schedule, there is no litigation, proceeding (including,
without limitation, arbitral proceedings) or other legal or administrative
proceeding pending or, to the knowledge of the Company (as hereinafter
defined in Paragraph 4.4), threatened against the Company or any Sub-
sidiary. There are no such suits, actions, proceedings or claims pending,
or, to the knowledge of the Company, threatened, challenging the validity
or propriety of, or otherwise relating to or involving, this Agreement or
the transactions contemplated hereby. There is no judgement, order, writ,
injunction, decree or award (whether issued by a court, an arbitrator, a
governmental body or agency thereof or otherwise) to which the Company or
any Subsidiary is party, or involving the properties, assets or business
of the Company or any Subsidiary, which is unsatisfied or which requires
continuing compliance therewith by the Company or any Subsidiary. Except
with respect to Taxes (as defined and covered in Paragraph 4.2.10, below),
ERISA (as defined and covered in Paragraph 4.2.13, below), and
Environmental Laws (as defined and covered in Paragraph 4.2.21, below),
neither the Company nor any Subsidiary has received any written notice
that the Company or any Subsidiary has not complied in all material
respects with all applicable foreign and domestic laws, statutes,
ordinances, codes, rules, regulations, judgements, orders, writs or
decrees of any federal, state, local or foreign court or governmental or
regulatory body or agency thereof to which the Company or any Subsidiary
may be subject or which are applicable to the operations, businesses or
assets of the Company or any Subsidiary.
4.2.5. Subsidiaries, Investments. The Disclosure Schedule
contains a list of all of the Company's ownership or investment interests
in any Subsidiary. Except as set forth in the Disclosure Schedule, all of
the issued and outstanding shares of capital stock (or other equity
interests) of each Subsidiary are owned beneficially and of record by the
Company or by a Subsidiary (as indicated in the Disclosure Schedule), in
each case free and clear of all liens, security interests, claims,
charges, pledges and encumbrances of any kind whatsoever.
4.2.6. Ownership and Use of Tangible Assets.
(a) The Company and its Subsidiaries have good, valid and
marketable title to or lease pursuant to a lease described in the
Disclosure Schedule (if required to be set forth therein) all tangible
personal property and assets which are material to the operation of the
businesses of the Company and its Subsidiaries as they are currently
conducted free and clear of all encumbrances except those which would
not have a Material Adverse Effect on the Company's or its Subsidiaries'
ability to use or enjoy beneficial ownership and except as set forth in
the Disclosure Schedule.
(b) The Disclosure Schedule contains a complete list and
description of all real property owned by the Company and its
Subsidiaries (the "Owned Real Property"), in each case indicating the
entity owning such property. The Disclosure Schedule also contains a
complete list and description of all real property leased by the Company
and its Subsidiaries (collectively, the "Leased Real Property"), in each
case indicating the entity leasing such property and the persons or
entities from whom such property is being leased. The Owned Real
Property and the Leased Real Property are collectively referred to
herein as the "Real Property." With respect to all such Owned Real
Property, the Company or its Subsidiaries have good, valid and
marketable title in fee simple thereto free and clear of all encum-
brances, except (i) as specifically disclosed in the Disclosure Schedule
or in the title policy obtained by the Buyer pursuant to Paragraph 6.1.4
hereof, or encumbrances which would not have a Material Adverse Effect,
(ii) Taxes not yet due, (iii) easements, rights-of-way and similar
covenants and restrictions of record, and (iv) municipal and zoning
ordinances. To the Company's knowledge, none of the matters in the
foregoing clauses (i) through (iv) interfere with the use of the Real
Property as currently utilized. Except as set forth in the Disclosure
Schedule, no work has been performed on or with respect to or in
connection with any of the Real Property that would cause such Real
Property to become subject to any mechanics', materialmen's, workmen's,
repairmen's, carriers' or similar lien. The structures, plants,
improvements, systems (including, without limitation, heating, venti-
lation, air conditioning, electrical, plumbing, fire sprinkler, light-
ing, elevator and other mechanical systems) and fixtures located in or
about each such parcel of Real Property have been maintained in
accordance with reasonable maintenance standards generally followed in
the industry.
(c) To the knowledge of the Company, all tangible personal
property of the Company which is material to the Company's operations
has been maintained in accordance with reasonable maintenance standards
generally followed in the industry and is physically located at or about
the places of business of the Company and its Subsidiaries. None of
such tangible personal property is subject to any agreement, arrangement
or understanding for its use by any person other than the Company and
its Subsidiaries, the presence of which would have a Material Adverse
Effect.
(d) The Disclosure Schedule sets forth a complete and correct
list of all tangible personal property leases to which the Company and
its Subsidiaries are parties which involve annual lease payments of more
than One Hundred Thousand Dollars ($100,000.00). Each such lease is in
full force and effect against the Company or one of its Subsidiaries.
All lease payments due to date on any such lease have been paid, and
neither the Company nor any Subsidiary is in default under any such
lease, and to the knowledge of the Company no event has occurred which
constitutes, or with the lapse of time or the giving of notice or both
would constitute, a default by the Company or any Subsidiary under such
lease. To the knowledge of the Company, there are no disputes or
disagreements between the Company and its Subsidiaries, on the one hand,
and any other party with respect to any such lease.
4.2.7. Patents, Trademarks, and Other Intellectual Property. The
Disclosure Schedule contains a list of all patents, patent applications,
trademarks, trademark applications, trade names, service marks and
copyrights, and licenses and rights to any of the foregoing (collectively
the "Intellectual Properties") which are owned, controlled, used or held
(under license or otherwise) by and which are material to the Company and
its Subsidiaries in connection with the conduct of their businesses. The
Company or its Subsidiaries are the sole and exclusive owner of the
Intellectual Properties described as owned in the Disclosure Schedule,
free and clear of all encumbrances except as set forth in the Disclosure
Schedule. No claims have been asserted or, to the knowledge of the
Company, threatened by any person challenging the Company's or its
Subsidiaries' ownership or use of any of the Intellectual Properties. To
the knowledge of the Company, none of the Intellectual Properties
infringes or otherwise violates the rights of others or is being infringed
by others in any manner which would have a Material Adverse Effect. In
order to conduct the business of the Company as such is currently being
conducted, to the knowledge of the Company, the Company does not require
any Intellectual Properties that it does not already have the use of. The
Company has not granted any license or made any assignment of any
Intellectual Properties listed in the Disclosure Schedule. The Company
does not pay any royalties or other consideration for the right to use any
intellectual properties of others. All Intellectual Properties of the
Company are valid, enforceable and in good standing, and to the knowledge
of the Company, there are no equitable defenses to enforcement based on
any act or omission of the Company.
4.2.8. Financial Statements. Included in the Disclosure Schedule
are true and correct copies of the consolidated financial statements of
the Company and its Subsidiaries for the fiscal periods ended October 31,
1994, and October 31, 1995 (the "Historical Financial Statements") and the
interim financial statements for the period ended June 30, 1996 (the
"Interim Financial Statements" and with the Historical Financial State-
ments, collectively the "Financial Statements". The Financial Statements
fairly present the financial condition of the Company and its Subsidiaries
(as applicable) on such dates and the results of operations for the
periods designated therein, and were prepared in accordance with generally
accepted accounting principles ("GAAP") consistently applied during the
periods covered thereby; subject, in the case of Interim Financial
Statements, to appropriate year-end adjustments and omitted disclosures
customarily placed in footnotes. The Historical Financial Statements were
audited by ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, LLP, whose reports thereon are attached to the
Disclosure Schedule. There has been no material adverse change in the
capitalization, assets or liabilities of the Company and its Subsidiaries
since the date of the Interim Financial Statements (the balance sheet
included therewith referred to as the "Interim Balance Sheet"), other than
changes in the ordinary course of business consistent with past practice.
4.2.9. Conduct Out of Ordinary Course. The Company has, since the
date of the Interim Balance Sheet, conducted its business and the
businesses of its Subsidiaries in the normal and ordinary course and has
not since such date, other than in the ordinary course of business or as
described in the Disclosure Schedule: (i) mortgaged, pledged or subjected
to, or agreed to mortgage, pledge or subject to, any Encumbrance, any
of the assets or business of the Company and its Subsidiaries, except as
contemplated in this Agreement; (ii) sold, transferred, leased to others
or otherwise disposed of or agreed to sell, transfer, lease or otherwise
dispose of any of the assets of the Company and its Subsidiaries; (iii)
suffered any damage, destruction or loss (whether or not covered by
insurance) materially and adversely affecting any of the material assets
of the Company, reasonable wear and tear excepted, or materially and
adversely affecting the Company and its Subsidiaries; (iv) borrowed,
or agreed to borrow, funds in excess of One Million Dollars
($1,000,000.00); (v) discharged or satisfied any Encumbrance, cancelled
or compromised any material debt or claim or paid any material obligation
or liability; (vi) directly or indirectly paid, or agreed to pay, any
severance or termination pay to any employee or otherwise granted any
general or specific increase in the salary, commission rate or other
compensation payable to any employee which was not accrued at such date;
(vii) issued, or agreed to issue, any securities of the Company or any
Subsidiary other than pursuant to the stock options described in the Dis-
closure Schedule; (viii) declared, paid, made or agreed to declare, pay or
make any dividends, distributions, redemptions, equity repurchases or
other transactions with respect to any securities of the Company or any
Subsidiary; (ix) had any change in its accounting principles, methods or
practices or any change in its depreciation or amortization policies or
rates; (x) had any change in the relationship or course of dealing with
any of any of its suppliers, customers, distributors, lenders or creditors
that has had or could reasonably be expected to have a Material Adverse
Effect; or (xi) had any labor disputes or disturbances, other than
grievances, which have had or could reasonably be expected to have a
Material Adverse Effect.
4.2.10. Taxes.
(a) Definitions. For purposes of this Paragraph 4.2.10, the
following terms shall have the following meanings:
The terms "Tax" and "Taxes" shall mean and include any and all
United States, state, local, foreign income, alternative, minimum,
accumulated earnings, personal holding company, franchise, capital
stock, profits, windfall profits, gross receipts, sales, use, value
added, transfer, registration, stamp, premium, excise, customs duties,
severance, environmental (including taxes under section 59A of the
Internal Revenue Code of 1986, as amended (the "Code"), real property,
personal property, ad valorem, occupancy, license, occupation,
employment, payroll, social security, disability, unemployment, workers'
compensation, withholding, or other taxes, assessments, social security
obligations, deficiencies, fees, customs duties or other governmental
charges from time to time imposed by or required to be paid to any
governmental authority (including penalties and additions to tax
thereon, penalties for failure to file a return or report, and interest
on any of the foregoing).
The term "Tax Return" shall mean and include any return,
declaration, report, claim for refund, or information return or
statement filed or required to be filed relating to Taxes, including any
schedule or attachment thereto, and any amendment thereof.
(b) Warranties and Representations. Except as described in
the Disclosure Schedule:
(i) All Tax Returns which the Company or any Subsidiary
was required to file prior to the date hereof (including, without
limitation, sales, payroll, employee withholding, social security
and unemployment Tax Returns) have been filed when due and when
filed were true and correct in all material respects.
(ii) All Taxes that the Company or any Subsidiary is
required by law to withhold or to collect for payment have been
duly withheld and collected, and have been paid or accrued,
reserved against and entered on the books of the Company.
(iii) There has been no claim or issue (other than a
claim or issue that has been finally settled) concerning any
liability for Taxes of the Company or any Subsidiary asserted,
raised or to the knowledge of the Company, threatened by any taxing
authority.
(iv) There are no agreements or applications by the
Company or any Subsidiary for an extension of time for the
assessment or payment of any Taxes or for the filing of any Tax
Return, or waivers of a statute of limitations by the Company or
any Subsidiary in respect of Taxes.
(v) The Company is not a party to any agreement,
contract, or other arrangement that would result, separately or in
the aggregate, in the requirement to pay any "excess parachute
payment" within the meaning of Section 280G of the Code.
(vi) There are no Tax sharing agreements or other
similar arrangements with respect to or involving the Company or
any Subsidiary.
4.2.11. Contracts and Other Agreements.
(a) The Disclosure Schedule sets forth a true and complete
list of all of the following to which the Company or any Subsidiary is a
party or by which it or any Subsidiary is bound (collectively, the
"Contracts"):
(i) any lease of personal property which involves annual
expenditures or receipts in excess of One Hundred Thousand Dollars
($100,000.00);
(ii) each lease with respect to the Leased Real
Property;
(iii) any license agreement or other agreements of the
Company or any Subsidiary providing in whole or in part for the use
of any patents, trademarks, trade names, service marks, copyrights,
inventions, trade secrets or other proprietary know-how or other
intellectual property, whether the Company is the licensor or the
licensee thereunder, and all settlements, consents or forbearance
to ▇▇▇ agreements relating thereto;
(iv) any contract, arrangement or understanding not made
in the ordinary course of business and consistent with past
practice which is material to the business of the Company;
(v) any note, bond, indenture, credit facility,
mortgage, security agreement or other instrument or document
relating to or evidencing indebtedness for money borrowed, or a
security interest or mortgage in the assets of the Company or any
Subsidiary in excess of One Million Dollars ($1,000,000.00);
(vi) any indemnity or guaranty issued by the Company or
any Subsidiary during the past three (3) years (other than
customary product warranties provided by the Company or any Sub-
sidiary in the ordinary course of business);
(vii) any contract, arrangement or understanding
materially restricting the right of the Company or any Subsidiary
to engage in any business activity or compete with any business;
(viii) any contract, arrangement or understanding by the
Company or any Subsidiary to customers or distributors which
aggregate in excess of Four Hundred Thousand Dollars ($400,000.00)
to any one customer or distributor;
(ix) any power of attorney given by the Company or any
Subsidiary, which is currently in effect, to any person, firm or
corporation for any purpose whatsoever;
(x) any collective bargaining agreements with any
unions, guilds, shop committees or collective bargaining groups; or
(xi) any contracts or agreements with current officers,
other employees, consultants or advisors other than contracts which
by their terms are cancelable by the Company with notice or not
more than sixty (60) days.
(b) The Company has previously provided to the Buyer complete
and correct copies of each written Contract (and any amendments
thereto). (i) Each Contract is in full force and effect against the
Company; (ii) neither the Company nor any Subsidiary is in default under
any Contract, and no event has occurred which constitutes, or with the
lapse of time or the giving of notice or both would constitute, a
material default by the Company or any Subsidiary under any such
Contract; and (iii) to the knowledge of the Company, there are no
material disputes or disagreements between the Company or its Subsidi-
aries and any other party with respect to any such Contract. Copies of
the standard terms and conditions of sale, delivery or lease of the
Company are included in the Disclosure Schedule.
4.2.12. Product Warranty and Product Liability. The Disclosure
Schedule contains a true, correct and complete copy of the Company's
standard warranty or warranties provided for Products (as defined below)
sold and subject to such warranties as of the Closing. Except as stated
in the warranties or otherwise set forth on the Disclosure Schedule, there
are no warranties, commitments, policies or obligations with respect to
the return, repair or replacement of Products. The Disclosure Schedule
contains a description of all product liability claims and similar claims,
actions, litigation and other proceedings relating to Products
manufactured or sold, or services rendered, which are presently pending or
which to the Company's knowledge are threatened, or which have been
asserted or commenced against the Company within the last five (5) years,
in which a party thereto either requests injunctive relief (whether
temporary or permanent) or alleges damages (which are not covered by
insurance). Except as set forth in the Disclosure Schedule, to the
knowledge of the Company there are no defects in design, construction or
manufacture of Products which would adversely affect performance or create
an unusual risk of injury to persons or property. Except as set forth in
the Disclosure Schedule, to the knowledge of the Company no facts or
conditions exist which could reasonably be expected to result in a recall
campaign. To the knowledge of the Company, the Products have been
designed and manufactured so as to meet and comply with all governmental
standards and specifications currently in effect, and have received all
governmental approvals necessary to allow their sale and use. As used in
this Paragraph 4.2.12, the term "Products" means any and all products
currently or at any time previously manufactured, distributed or sold by
the Company, or by any predecessor of the Company for which the Company
has legal liability under any brand name or ▇▇▇▇ under which products are
or have been manufactured, distributed or sold by the Company.
4.2.13. Employee Benefit Matters. The Disclosure Schedule sets
forth all of the Company's bonus, deferred or incentive compensation,
profit sharing, retirement, vacation, sick leave, hospitalization,
insurance, disability stock options or severance plans, programs,
arrangements and policies and all "employee pension benefit plans" (as
defined in Section 3(2) of the Employee Retirement Income Security Act of
1974, as amended ("ERISA")) or "employee welfare benefit plans" (as
defined in Section 3(1) of ERISA) (collectively, the "Plans") sponsored
or contributed to by the Company or by any trade or business, whether or
not incorporated (an "ERISA Affiliate") that together with the Company
would be deemed a "single employer" within the meaning of Section 4001 of
ERISA, for the benefit of an employee or former employee of the Company or
any ERISA Affiliate. To the knowledge of the Company, each such Plan is
in compliance, and has been administered in accordance with the applicable
provisions of ERISA and the Code and all other applicable laws, rules and
regulations, the violation of which would have a Material Adverse Effect.
The Company has fulfilled its obligations under the minimum funding
standards of ERISA and the Code with respect to each such Plan and no
accumulated funding deficiency exists with respect to any such Plan which
would have a Material Adverse Effect. All contributions required to be
made with respect to all Plans on or prior to the Closing Date have been
timely made. To the knowledge of the Company, neither the Company nor any
ERISA Affiliate nor any Plan, Trust or Trustee or administrator thereof
has (i) engaged in any transaction prohibited by ERISA or the Code or
which would subject the Company to a material tax or civil penalty
thereunder; (ii) breached any fiduciary duty owed by it with respect to
the Plans described above; or (iii) failed to file and distribute in a
timely and proper manner all reports and information required to be filed
or distributed in accordance with ERISA. Neither the Company nor any
ERISA Affiliate has incurred any liability to the Pension Benefit Guaranty
Corporation (the "PBGC") nor, to the knowledge of the Company has the PBGC
taken any action to terminate any of the Plans described above. The
Company is not a participating or contributing employer in any multi-
employer benefit plan with respect to employees of the Company or its
Subsidiaries nor has the Company or its Subsidiaries incurred any
withdrawal liability with respect to any multi-employer plan or any
liability in connection with the termination or reorganization of any
multi-employer plan. Each Plan intended to be "qualified" within the
meaning of Section 401(a) of the Code is so qualified and the trusts
maintained thereunder are exempt from taxation under Section 501(a) of the
Code. There are no pending, or to the knowledge of the Company,
threatened or anticipated claims by or on behalf of any Plan, by any
employee or beneficiary covered under any such Plan, or otherwise
involving any such Plan (other than routine claims for benefits).
4.2.14. Labor Practices. Except as set forth in the Disclosure
Schedule, within the last three (3) years the Company has not experienced
any labor disputes, union organization attempts or any work stoppage due
to labor disagreements in connection with its business. Except to the
extent set forth in the Disclosure Schedule (a) the Company is in
compliance with all applicable laws respecting employment and employment
practices, terms and conditions of employment and wages and hours which
would have a Material Adverse Effect, and is not engaged in any unfair
labor practices; (b) there is no unfair labor practice charge or complaint
against the Company pending or threatened to the knowledge of the Company;
(c) there is no labor strike, dispute, request for representation,
slowdown or stoppage actually pending or to the knowledge of the Company,
threatened against or affecting the Company nor any secondary boycott with
respect to products of the Company; (d) to the knowledge of the Company,
no question concerning representation has been raised or is threatened
respecting the employees of the Company; (e) no grievance which might have
a Material Adverse Effect on the Company, nor any arbitration proceeding
arising out of or under collective bargaining agreements, is pending and
no such claim therefor exists; and (f) there are no administrative charges
or court complaints against the Company concerning alleged employment
discrimination or other employment related matters pending or to the
knowledge of the Company, threatened before the U.S. Equal Employment
Opportunity Commission or any state or federal court or agency.
4.2.15. Brokers; Agents. The Company has not dealt with retained,
employed or used any agent, finder, broker or other representative in any
manner which could result in the Company or the Buyer being liable for any
fee or commission in the nature of a finder's fee or originator's fee in
connection with the subject matter of this Agreement, other than any fees
which may be payable to ▇▇▇▇▇▇ ▇. ▇▇▇▇▇ & Co. Incorporated, whose fees and
expenses shall be paid by the Sellers.
4.2.16. Permits and Licenses. To the knowledge of the Company,
the Company has all licenses, permits, approvals, authorizations and
consents of all governmental and regulatory authorities and all
certification organizations required for the conduct of the business
operation of its facilities. All such licenses, permits, approvals,
authorizations and consents described in the Disclosure Schedule are in
full force and effect. To the knowledge of the Company, except as set
forth in Disclosure Schedule, the Company (including its operations,
properties and assets) is and has been in compliance with all such permits
and licenses, approvals, authorizations and consents, except where such
noncompliance would not have a material Adverse Effect. Neither the
Company nor any Subsidiary has received any notice of, and neither the
Company nor any Subsidiary has any knowledge of, any intention on the part
of any government authority to cancel, revoke or modify any permit,
license, exemption, consent, authorization or approval of the Company,
which in each case will have a Material Adverse Effect.
4.2.17. Major Customers. The Disclosure Schedule sets forth a
complete and correct list of the five (5) largest customers of the Company
and its Subsidiaries in terms of contracted work during the eight (8)
month period ended on the date of the Interim Balance Sheet, showing the
total value of such contracts. No such customer has given the Company or
any Subsidiary any notice terminating, rescinding, suspending or reducing
in any material respect, or specifying an intention to terminate, suspend
or reduce in any material respect in the future, or otherwise reflecting a
material adverse change in, the business relationship between such
customer and the Company and such Subsidiary. The Company has no sales
contracts or commitments except those made in the ordinary course of
business, at arm's length.
4.2.18. Dealers and Other Agents. The Disclosure Schedule sets
forth a complete and correct list of the names and addresses of each
authorized dealer, sales representative or other agent (a
"Representative") currently engaged by the Company and its Subsidiaries
and who is not an employee of the Company or its Subsidiaries, to whom the
Company has made annual payments during the year ended October 31, 1995,
aggregating more than Two Hundred Fifty Thousand Dollars ($250,000.00), a
summary description of the services provided by each such Representative
and the territory assigned to each such Representative. True and correct
copies of all agreements between any such Representative and the Company
and its Subsidiaries are included in the Disclosure Schedule. The Company
is not in default under any agreement with any Representative, nor has any
event or omission occurred which through the passage of time or the giving
of notice, or both, constitute a default thereunder, except such defaults
which would not have a Material Adverse Effect. To the knowledge of the
Company, no Representative is in default under any such agreement, nor has
any event or omission occurred which, through the passage of time or the
giving of notice, or both, would constitute a default thereunder or give
rise to an automatic termination or the right of discretionary
termination, thereof, except such defaults which would not have a Material
Adverse Effect. The Disclosure Schedule sets forth a complete and correct
list of all stocking or demonstration units, as such term is customary
used by the Company, located at, consigned, en route or sold to any
Representative as of July 31, 1996.
4.2.19. Material Suppliers of Inventories. The Disclosure
Schedule sets forth a complete and correct list of all written supply
contracts between the Company and its Subsidiaries and each supplier of
goods and services to the Company and its Subsidiaries who provided goods
and services to the Company and its Subsidiaries which involved an
aggregate value of Two Million Dollars ($2,000,000.00) or more during the
year ended October 31, 1995 with such supplier. The Disclosure Schedule
also correctly identifies all currently outstanding purchase orders of the
Company and its Subsidiaries for goods or services with an aggregate value
of Two Million Dollars ($2,000,000.00) or more. No supplier identified in
the Disclosure Schedule has given the Company or any Subsidiary any notice
terminating, suspending or reducing in any material respect, or specifying
an intention to terminate, suspend or reduce in any material respect, or
otherwise reflecting a material adverse change in, the business relation-
ship between such supplier and the Company and its Subsidiaries.
4.2.20. Insurance. The Disclosure Schedule contains a complete
and correct list of all material insurance policies carried by, or
covering, the Company and its Subsidiaries with respect to their
businesses, together with, in respect of each such policy, the name of the
insurer, the policy number, the expiration date thereof and each pending
claim thereunder known to the Company. Complete and correct copies of
each such policy have previously been provided to the Buyer. No written
notice of cancellation has been received by the Company with respect to
any such policy. To the knowledge of the Company, (i) all premiums due
thereon have been paid in a timely manner and (ii) the Company and its
Subsidiaries have complied in all material respects with the terms and
provisions of such policies. Except as set forth in the Disclosure
Schedule, to the knowledge of the Company, the Company has not been
refused any insurance with respect to any aspect of its operations of its
business nor has its coverage been limited by any insurance carrier to
which it has applied for insurance or with which it has carried insurance
during the last three (3) years. There is no claim by the Company pending
under any such policies as to which coverage has been questioned, denied
or disputed by the underwriters of such policies. Such policies are
sufficient in all material respects for compliance by the Company with all
requirements of law and with the requirements of all material contracts to
which the Company is a party.
4.2.21. Environmental Matters.
(a) Definitions. For purposes of this Paragraph 4.2.21 the
following terms shall have the following meanings:
"Environmental Claim" shall mean any investigation, notice,
violation, demand, suit, injunction, order, consent decree, penalty,
fine, lien, proceeding, or claim (whether administrative, judicial, or
private in nature) arising (a) pursuant to, or in connection with, a
violation by the Company or any Subsidiary of any Environmental Law, (b)
in connection with any Hazardous Material, (c) from any abatement,
removal, remedial, corrective, or other response action by the Company
or any of its Subsidiaries in connection with a Hazardous Material,
Environmental Law or order of a Governmental Authority or (d) from any
damage, injury, threat, or harm to the environment by the Company or any
of its Subsidiaries.
"Environmental Law" shall mean any past or current Legal
Requirement pertaining to the protection of the environment, including
without limitation, the Comprehensive Environmental Response,
Compensation, and Liability Act of 1980, as amended by the Superfund
Amendments and Reauthorization Act of 1986, 42 USC 9601 et seq., the
Solid Waste Disposal Act, as amended by the Resource Conservation and
Recovery Act of 1976 and Hazardous and Solid Waste Amendments of 1984,
42 USC 6901 et seq. ("RCRA"), and any implementing law, and any
amendment, rule, or regulation issued thereunder.
"Governmental Approval" shall mean any permit, license,
variance, certificate, clearance, closure, exemption, decision or action
or approval of a Governmental Authority which is required under an
Environmental Law.
"Governmental Authority" shall mean any federal, state,
regional, county, or local person or body having legal authority to
administer any Environmental Law.
"Hazardous Material" shall mean any material which is
hazardous or toxic to the environment and/or which is subject to
regulation, control or remediation under Environmental Law, including,
without limitation, asbestos, polychlorinated biphenyl ("PCBs") and
petroleum (including crude oil and any fraction thereof).
"Legal Requirement" shall mean any treaty, convention,
statute, law, regulation, ordinance, Governmental Approval, injunction,
judgement, order, consent decree, or other requirement of any Govern-
mental Authority relating to health, safety, natural resources and the
environment.
"Release" shall mean any spilling, leaking, pumping, pouring,
emitting, emptying, discharging, injection, escaping, leaching, dumping,
or disposing into the indoor or outdoor environment including, without
limitation, the abandonment or discarding of barrels, drums, containers,
tanks, and other receptacles containing or previously containing any
Hazardous Material.
(b) Warranties and Representations. Except as described in
the Disclosure Schedule:
(i) The Subsidiaries and the Real Estate comply in all
material respects with any and all applicable Environmental Laws.
(ii) The Company and its Subsidiaries have obtained all
necessary Governmental Approvals necessary for the operations of
their businesses and properties.
(iii) Neither the Company nor any Subsidiary (a) has
caused any Release or disposal of any Hazardous Material at the
Real Property or (b) caused any Release of any Hazardous Material
at any third party property.
(iv) Neither the Company nor any Subsidiary has received
any notification of any actual or potential responsibility for any
Release at any third party property.
(v) The Real Property does not contain any: (a) under-
ground storage tank, (b) asbestos containing building material,
PCBs, radon, or urea formaldehyde foam, (c) landfill or dump, or
(d) hazardous waste management facility as defined pursuant to RCRA
or any comparable state law.
(vi) There is no Environmental Claim involving the Real
Property or other property formerly owned, leased or operated by
the Company and its Subsidiaries or to the knowledge of the Company
threatened against the Company or any Subsidiary.
(vii) There are no conditions on, under or in any way
affecting the Real Property which would impose liability to the
Company or any of its Subsidiaries under any Environmental Law.
4.2.22. Bank Accounts. The Disclosure Schedule sets forth the
names and locations of all banks, trust companies, savings and loan
associations and other financial institutions at which the Company
maintains a safe deposit box, lock box or checking, savings, custodial or
other account of any nature, the type and number of each such account and
the names of all persons authorized to draw thereon or who have access
thereto.
4.2.23. Inventory. Except to the extent a violation hereof will
not have a Material Adverse Effect and except as set forth in the
Disclosure Schedule (i) inventories of finished goods reflected on the
Interim Balance Sheet were and will be of a quality and quantity useable
and saleable in the ordinary course of business and had and are currently
expected to have a commercial value at least equal to the value shown
thereof, (ii) inventories of raw materials, work in process, and
replacement parts (whether located at the Company's facilities or in
transit) are (a) of good and merchantable quality, except commercial
liabilities and obligations incurred in the ordinary course of business of
the Company; (b) in conformity with warranties customarily given to
purchasers of like products; and (c) at levels adequate for and not
excessive in relation to the ordinary course of the operations and in
accordance with past inventory stocking practices of the Company. Except
as set forth in the Disclosure Schedule, all inventory of the Company is
located on premises owned or leased by the Company or its Subsidiaries.
4.2.24. Accounts Receivable. All accounts receivable of the
Company reflected on the Interim Balance Sheet, and as incurred in the
normal course of the Company's business since the date thereof, represent
arm's length sales actually made in the ordinary course of business and
not in dispute (net or their reserve shown on the Interim Balance Sheet
for doubtful accounts).
4.3. Warranties Survive Closing. The respective warranties and
representations of the Company and the Seller herein contained shall be
true and correct on the date hereof and on the Closing Date, and shall
survive the Closing: (i) with respect to any claim for a breach of any
warranty or representation made in Paragraph 4.2.10, until such time as
the underlying tax obligation is barred by the applicable period of
limitation under federal and state laws relating thereto (which may not be
extended without the consent of the Sellers); (ii) for a period of three
(3) years following the Closing Date for any claim based upon a breach of
any warranty or representation made in Paragraph 4.2.21; (iii)
indefinitely for any claim based upon a breach of any warranty or
representation made in Paragraph 4.1; and (iv) for a period of one (1)
year following the Closing Date with respect to any claim other than a
claim referred to in clauses (i) through (iii), above. Notwithstanding
the provisions of the previous sentence, if the Buyer provides written
notice to the Company and each Seller as specified in Paragraph 9.3,
below, of any claim for which the Buyer seeks indemnification pursuant to
Article IX, below, within the applicable period referred to in the
previous sentence, the claim so made shall survive the Closing until
resolved but, in any event, only for so long as the applicable statute of
limitations for matters covered by such claim. Any claim not so made in
writing prior to the expiration of the applicable period referred to in
the previous sentence shall be deemed to have been waived by the Buyer and
no other party shall have further liability therefor.
4.4. Knowledge. For each of those warranties and representations
which is made in Paragraph 4.1 and which is subject to the qualification
"to the knowledge of such Seller," such warranty and representation shall
be deemed limited to those matters of which the Seller who is making such
warranty or representation has actual knowledge. For those warranties and
representations which are made in Paragraph 4.2 and which are subject to
the qualification "to the knowledge of the Company," "to the Company's
knowledge," or similar words or phrases, such warranties and
representations shall be deemed limited to those matters of which any of
the following officers of the Company has actual knowledge: President
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Vice-President ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Vice-President ▇▇▇▇▇▇▇
▇. ▇▇▇▇▇▇▇▇, or Vice-President ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇.
ARTICLE V
Warranties and Representations of the Buyer
5.1. Warranties and Representations. The Buyer hereby warrants
and represents to the Sellers, which warranties and representations shall
survive the Closing for the period set forth in Paragraph 5.2, below, as
follows:
5.1.1. Authority. The Buyer is a corporation duly organized,
validly existing and in good standing under the laws of the State of
Wisconsin and has the power and authority to carry on all business
activities which it currently conducts. The Buyer has the corporate power
and authority to execute and deliver this Agreement and the Buyer
Ancillary Documents and to consummate the transactions contemplated hereby
and thereby. The execution and delivery of this Agreement and the Buyer
Ancillary Documents by the Buyer and the consummation of the transactions
contemplated hereby and thereby by the Buyer have been approved by all
necessary corporate action on behalf of the Buyer and are and shall
constitute valid and legally binding obligations of the Buyer, enforceable
against the Buyer in accordance with their respective terms except as
enforceability may be limited by bankruptcy, insolvency, fraudulent
conveyance, moratorium, reorganization and other laws generally affecting
the rights of creditors and general principles of equity and applicable
federal and state laws which may affect the availability of equitable
remedies. The execution and delivery of this Agreement and the Buyer
Ancillary Documents by the Buyer does not, and the consummation of the
transactions contemplated hereby and thereby and compliance with the terms
hereof and thereof by the Buyer will not (a) conflict with, or result in
any breach or violation of (i) any provision of the Articles of Incorpora-
tion or By-Laws of the Buyer or (ii) any law, statute, rule, regulation,
ordinance, code, judgement, order, writ, injunction, decree, determination
or award applicable to the Buyer, or (b) violate or conflict with, or
result in a breach under, any agreement, instrument or document to which
the Buyer is a party or is subject, except for any breach, violation or
default which would not adversely affect the ability of the Buyer to
consummate the purchase of the Subject Shares or the other transaction
contemplated by this Agreement or the Buyer Ancillary Documents. No
consent, approval, order or authorization of, or registration, declaration
or filing with, any court, governmental authority or instrumentality, or
other third party is required to be obtained or made in connection with
the execution and delivery of this Agreement or the Buyer Ancillary
Documents by the Buyer or the consummation by the Buyer of the
transactions contemplated hereby and thereby other than the pre-merger
notification with the FTC and DOJ under the HSR Act. No claim, action,
suit, proceeding, arbitration, investigation or inquiry by any federal,
state, municipal, foreign or other court or governmental or administrative
body or agency, any securities or commodities exchange or any private
arbitration tribunal is now pending or, to the knowledge of the Buyer,
threatened, against or relating to the Buyer which would adversely affect
the ability of the Buyer to consummate the purchase of the Subject Shares
or the other transactions contemplated by this Agreement or the Buyer
Ancillary Documents.
5.1.2. Investment Representations. The Subject Shares to be
purchased by the Buyer pursuant to this Agreement are being acquired by
the Buyer for investment only and not with a view to any public distribu-
tion thereof. The Buyer has such knowledge and experience in business
matters as to be capable of evaluating the merits and risks in purchasing
the Subject Shares. The Buyer acknowledges that the Subject Shares have
not been registered under the Securities Act of 1933, as amended, or the
securities laws of any state (collectively, the "Securities Laws"), and
have been issued in reliance upon exemptions from the registration
requirements of the Securities Laws. The Buyer understands that any
transfer or disposition of the Subject Shares may only be made pursuant to
an effective registration under applicable Securities Laws or pursuant to
an exemption from the registration requirements of the Securities Laws.
The Buyer understands that any certificates representing the Subject
Shares may bear an appropriate legend consistent with the foregoing.
5.1.3. Brokers; Agents. The Buyer has not dealt with any agent,
finder, broker or other representative in any manner which could result in
the Sellers or the Company being liable for any fee or commission in the
nature of a finder's or originator's fee in connection with the subject
matter of this Agreement or the Buyer Ancillary Documents.
5.1.4. Guarantees. The Buyer has completed all arrangements
necessary to secure the release of any obligations or guarantees of any
Seller of obligations of the Company with USF&G and agrees to deliver the
release of same at the Closing.
5.2. Warranties Survive Closing. The warranties and
representations of the Buyer herein contained shall be true and correct on
the date hereof and on the Closing Date and shall survive the Closing
until resolved among the Sellers and the Buyer.
ARTICLE VI
Covenants
6.1. Covenants of the Company. The Company covenants and agrees
as follows:
6.1.1. Access. Prior to the Closing, the Company will (i) give
the Buyer and its representatives, employees, counsel and accountants
reasonable access to the properties, books and records of the Company and
its Subsidiaries, and (ii) furnish the Buyer and its designated
representatives with financial and operating data and other information
with respect to the Company and its Subsidiaries for the purpose of
permitting the Buyer, among other things, to (a) conduct its due diligence
review, (b) review the financial statements of the Company and its
Subsidiaries and (c) prepare for the consummation of the transactions
contemplated by this Agreement. Without limiting the foregoing, the
Sellers and the Company will permit the Buyer and its accountants to have
access during normal business hours to examine and make copies of all work
papers and schedules of the Company, its Subsidiaries and its accountants.
In connection therewith, the Buyer shall be permitted to discuss the
business affairs and financial statements of the Company and its Subsidi-
aries with the Company's accountants, to review the work papers of such
accountants regarding the Company, and in the presence of such members of
management of the Company as reasonably designated by Buyer and at
reasonable times with proper notice, after prior consultation with such
management, to interview the employees of the Company regarding continued
employment and to discuss with the appropriate employees of the Company
and its Subsidiaries such matters regarding the business and assets of the
Company and its Subsidiaries as the Buyer may deem necessary or appro-
priate. The Buyer and the Company agree that nothing in this Agreement
shall be interpreted or construed as limiting, waiving, terminating or
otherwise affecting that Confidentiality Agreement between Buyer and the
Company dated April 22, 1996. The Buyer and the Company acknowledge that
the terms of such Confidentiality Agreement remain in full force and
effect.
6.1.2. Records. On the Closing Date, the Company will deliver to
the Buyer all original records relating to the Company and its
Subsidiaries which are in the possession of any of the Sellers, provided
that the Sellers shall have the right to make copies of any and all
materials which they may deem necessary and shall have the continual right
to have access to such records in accordance with Paragraph 6.2.2, below.
6.1.3. Conduct of the Business of the Company and its
Subsidiaries. The Company covenants and agrees with the Buyer that,
between the date hereof and the Closing Date (except as otherwise agreed
in writing by the Buyer):
(a) the business of the Company and its Subsidiaries will be
conducted in the ordinary course consistent with past practice;
(b) no change will be made in the Articles of Incorporation
or By-Laws or other constituent documents of the Company or any
Subsidiary;
(c) the Company will use reasonable efforts to keep available
the services of its employees and to preserve the goodwill of the
customers, suppliers, dealers and others having business relationships
with the Company and its Subsidiaries; provided, however, that the
Company shall not be deemed to have violated this covenant unless it
fails to take reasonable action to prevent any of its management
employees from continuing to take the action of which the Company has
received written notice from the Buyer, which the Buyer deems to be a
failure to use such reasonable efforts;
(d) the Company shall promptly advise the Buyer in writing of
the commencement or threat of any suit, proceeding or investigation
against, relating to or involving the Company or any Subsidiary or which
could otherwise affect the assets or the businesses of the Company and
its Subsidiaries and which in each case would, if determined adversely
to the Company, have a Material Adverse Effect, whether or not covered
by insurance;
(e) the Company shall advise the Buyer of (i) any material
adverse change in the assets, liabilities or financial condition of the
Company and its Subsidiaries and (ii) in any event, any condition or
state of facts which results in the failure to satisfy any of the
conditions of the Buyer's obligations hereunder;
(f) the Company shall not create or permit to become
effective any encumbrances on the assets of the Company and its
Subsidiaries other than encumbrances created in the ordinary course of
business;
(g) the Company will maintain its current liability,
casualty, property and other insurance coverage in full force and
effect;
(h) the Company will not issue any additional shares of
capital stock or any options, warrants or other rights to purchase, or
securities convertible into or exchangeable for, shares of capital stock
of the Company (except upon exercise of options described in the Stock-
holder Agreements or the Disclosure Schedule);
(i) the Company will not declare or pay any dividends on or
make any distributions (however characterized) in respect of shares of
its capital stock;
(j) the Company will not repurchase or redeem any shares of
its capital stock except as provided in the Stockholder Agreements;
(k) the Company will not make any change in the accounting
principles or practices reflected in the Interim Financial Statements
other than as required by GAAP or in the Company's methods of applying
such principles or practices, or in the credit criteria utilized by them
in connection with its businesses;
(l) the Company will not directly or indirectly (through a
representative or otherwise) solicit or furnish any information to any
prospective buyer, or commence or conduct presently ongoing negotiations
with any other party or enter into any agreement with any other party
concerning the sale of the Company, the Company's assets or business or
any part thereof or any equity securities of the Company (an
"Acquisition Proposal"), and the Company shall immediately advise the
Buyer of the receipt of any Acquisition Proposal;
(m) the Company shall refuse to accept any certificates for
Subject Shares to be transferred or otherwise to allow such transfers to
occur upon its books;
(n) the Company and its Subsidiaries will not enter into any
agreement or commitment that violates any of the foregoing; and
(o) the Company will not hire a replacement for any of the
individuals listed on Exhibit 6.1.7 or Exhibit 6.4.1 attached hereto.
6.1.4. Title Insurance. Within fifteen (15) days after the date
of this Agreement, the Company, at its expense, shall provide to the Buyer
title insurance commitments, issued by a title insurance company
reasonably satisfactory to the Buyer, committing to issue to the Company
standard form owner's policies of title insurance with respect to all
Owned Real Property, together with a copy of each document to which
reference is made in such commitments. Such polices shall be standard
ALTA Form B-1992 owner's policies in the full fair market value of the
Owned Real Property, insuring good and marketable title thereto (expressly
including all easements and other appurtenances). All policies shall
insure title in full accordance with the representations and warranties
set forth herein and shall be subject only to such conditions and
exceptions as shall be reasonably acceptable to Buyer, and shall contain
such endorsements as Buyer shall reasonably request (including, but not
limited to, a non-imputation endorsement, owners' comprehensive
endorsement, zoning endorsement, and an endorsement over rights of
creditors, if requested by the Buyer or the Buyer's lender).
6.1.5. Surveys. Within thirty (30) days after the date of this
Agreement, the Company, at its expense, shall provide to Buyer original
current surveys of the Owned Real Property, certified to Buyer and to the
title company issuing the title insurance policies in Paragraph 6.1.4,
prepared by registered surveyors reasonably satisfactory to the Buyer,
which surveys shall be prepared in accordance with the 1992 Minimum
Standard Detail Requirements for ALTA/ACSM Land Title Surveys (including
all Table A Items), and pursuant to the accuracy of an Urban Class A
Survey.
6.1.6. Tax Matters. No new elections with respect to Taxes, or
changes in current elections with respect to Taxes, affecting the Company
shall have been made after the date of this Agreement without the prior
written consent of the Buyer.
6.1.7. Bonuses. At the Closing, the Company shall have the
authority to pay and upon approval of the shareholders of the Company
shall pay to the management employees of the Company listed on Exhibit
6.1.7 attached hereto in accordance with the general terms set forth
therein, in consideration for the agreement of such individuals to remain
employed with the Company through the Closing Date and to facilitate the
Closing and in addition to and not in lieu of any other bonuses or other
payments due to such employees as disclosed in the Disclosure Schedule,
the amount set forth opposite such management employees' names on Exhibit
6.1.7 hereof. For purposes hereof, the "After Tax Bonus Amount" shall be
an amount equal to the aggregate amount of bonuses paid by the Company
under this Paragraph 6.1.7, less forty percent (40%) of such amount.
6.2. Covenants of the Sellers. Each of the Sellers severally
covenants and agrees as follows:
6.2.1. Solicitation. Each Seller severally agrees that such
Seller will not directly or indirectly (through a representative or
otherwise) solicit or furnish information to any prospective buyer or
commence or conduct presently ongoing negotiations with any other party or
enter any agreement with any other party concerning an Acquisition
Proposal and each Seller shall advise the Buyer of the receipt by such
Seller of any Acquisition Proposal.
6.2.2. Stock Transfer. No Seller shall transfer or attempt to
transfer any of the Subject Shares except to the Buyer pursuant hereto.
6.2.3. Delivery of Documents. Each Seller shall have provided the
Buyer with (i) all forms, certificates and/or other instruments required
to pay the transfer and recording taxes and charges arising from the
transactions contemplated by this Agreement, together with evidence
satisfactory to the Buyer that such transfer taxes and charges have been
paid by the Company, (ii) an affidavit, stating, under penalty of perjury,
each Seller's United States taxpayer identification number and that the
transferor is not a foreign person, pursuant to section 1445(b)(2) of the
Code (or any similar provisions of state or other tax law), and (iii) a
clearance certificate or similar document(s) which may be required by any
state taxing authority to relieve the Buyer of any obligation to withhold
any portion of the payments to the Sellers pursuant to this Agreement.
6.3. Mutual Covenants. Each of the Company, each Seller severally
and the Buyer covenant and agree as follows:
6.3.1. Cooperation. The Buyer, the Company and the Sellers shall
cooperate with each other and shall cause their respective officers,
employees, agents, accountants and representatives to cooperate with each
other after the Closing to ensure the orderly transition of the ownership
of the Company and its business from the Sellers to the Buyer and to
minimize any disruption to the business of the Company that might result
from the transactions contemplated hereby.
6.3.2. Records. For a period of six (6) years after the Closing,
upon reasonable written notice, the Buyer and the Sellers agree to furnish
or cause to be furnished to each other and their respective repre-
sentatives, counsel and accountants access, during normal business hours,
to such information (including records pertinent to the Company and its
Subsidiaries) relating to the Company and its Subsidiaries as
is reasonably necessary for financial reporting tax and accounting
matters, assistance in the preparation and filing of any returns, reports
or forms or the defense of any tax claim or assessment; provided, however,
that such access does not unreasonably disrupt the normal operations of
the Company and its Subsidiaries. Without limiting the foregoing, each of
the Sellers shall have access to and the right, at such Seller's expense,
to copy any books or records of the Company or any of its Subsidiaries
which relate to matters or events prior to the Closing.
6.3.3. Publicity. At the Closing, the parties shall issue the
press release in the form annexed as Exhibit 6.3.3 hereto. Except for
this disclosure, the Buyer, the Company and the Sellers agree that no
further public releases or announcements concerning the transactions
contemplated hereby shall be issued by any party without the prior consent
of the other parties, except as such release or announcement may be
required by law, in which case the party required to make the release or
announcement shall allow the other parties reasonable time to comment on
such release or announcement in advance of its issuance.
6.3.4. Execution of Additional Documents. From time to time, as
and when requested by a party hereto, each party hereto shall execute and
deliver, or cause to be executed and delivered, all such documents and
instruments and shall take, or cause to be taken, all such further or
other actions as such other parties may reasonably deem necessary or
desirable to consummate the transactions contemplated by this Agreement or
the agreements, documents or instruments associated herewith.
6.3.5. Reasonable Efforts. Prior to the Closing, the Buyer and
the Sellers shall undertake all reasonable efforts to take or cause to be
taken all action and to do or cause to be done all things necessary,
proper or advisable under applicable laws and regulations to consummate
and make effective the transactions contemplated hereby; provided,
however, that no party shall be required to respond to any "second
request" of the FTC or DOJ under the HSR Act and in the event such second
request is received, the Buyer or the Sellers, as the case may be, shall
have the right to terminate this Agreement under Paragraph 10.1, below.
6.4. Covenants of the Buyer. The Buyer covenants and agrees as
follows:
6.4.1. Severance Payments. In the event that during the twelve
(12) month period after the Closing Date the employment of any salaried
employee is terminated by the Company or the Buyer without Cause, or the
base compensation or Other Benefits (as defined below) of such employee as
of the Closing are reduced in any respect, the Buyer will, or will cause
the Company, to pay to each such affected employee within ten (10) days
after the triggering event, an amount calculated as follows: (i) for each
of the management employees listed on Exhibit 6.4.1 attached hereto, an
amount equal to six (6) months of base compensation and benefits; and (ii)
for each of the salaried employees of the Company not listed on Exhibit
6.4.1, an amount equal to three (3) months of base compensation and
benefits. For purposes hereof, "Cause" shall mean the material breach by
an employee of such employee's duties after the Closing Date to the
Company or the Buyer which is not cured after such employee has received
written notice of such breach and has been provided with a reasonable
opportunity to cure such breach.
6.4.2. Incentive Compensation Plan. The Buyer shall offer, or
cause the Company to offer, to the senior management of the Company the
right to participate in an incentive compensation plan on the general
terms and conditions set forth on Exhibit 6.4.2 attached hereto.
6.4.3. Other Benefits. The Buyer covenants and agrees that it
will offer or cause the Company to continue to offer to employees of the
Company hereunder the incentive arrangements described in Paragraph 6.4.2
and all fringe benefits due employees of the Company which are reasonably
comparable to the benefits disclosed on the Disclosure Schedule, except
for (i) the stock appreciation rights described in the Disclosure Schedule
and (ii) the incentive bonus arrangements described in the Disclosure
Schedule. For purposes hereof, all such fringe benefits (except for the
benefits described in clauses (i) and (ii)) shall be referred to herein
as the "Other Benefits."
ARTICLE VII
Disclosure Schedule
7.1. General. Although the schedules and information set forth in
the Disclosure Schedule specifically refer to the paragraph of this
Agreement to which such schedule and information is responsive, each such
schedule and information shall be deemed to have been disclosed with
respect to any other paragraph of this Agreement or for any other purpose
to which such disclosure is applicable and reasonably apparent. Terms
used in the Disclosure Schedule and not otherwise defined therein shall
have the same meanings as are ascribed to such terms in this Agreement.
Any documents attached to the Disclosure Schedule are incorporated in
their entirety into the Disclosure Schedule.
7.2. Updates to Disclosure Schedule. The Company or the Sellers
shall have the right to supplement the Disclosure Schedule prior to the
Closing by delivery to the Buyer prior to the Closing Date of any such
supplement (a "Disclosure Supplement"). Each Disclosure Supplement shall
be in writing and shall be delivered in accordance with Paragraph 11.2 of
this Agreement. Unless the existence of any matter set forth in any such
Disclosure Supplement which was not disclosed at the time of the signing
of this Agreement (a "New Matter") would have a Material Adverse Effect,
the Disclosure Schedule referred to herein shall be deemed amended and
supplemented as of the Closing Date by all information including, without
limitation, any New Matter set forth in any Disclosure Supplement and the
warranties and representations of the Sellers made in Article IV hereof
shall be deemed amended and supplemented by all such information set forth
in each Disclosure Supplement. In such event all references to Disclosure
Schedule shall include all Disclosure Supplements. To the extent that the
existence of any New Matter would have a Material Adverse Effect, the
Buyer shall have the right under Paragraph 10.1, below, (a) to terminate
this Agreement by written notice to the Sellers within five (5) days after
receipt of the Disclosure Supplement which includes the New Matter but
prior to the Closing or (b) to consummate the transactions contemplated
hereby. To the extent that the Buyer elects to so consummate the
transactions contemplated hereby, the Disclosure Schedule shall be deemed
amended and supplemented by all information set forth in each Disclosure
Supplement, and the warranties and representations of the Sellers made in
Article IV hereof shall be deemed amended and supplemented by all such
information set forth in each Disclosure Supplement as if amended on the
date of execution hereof.
ARTICLE VIII
Non-Disclosure
8.1. Non-Disclosure of Confidential Information. Except as may be
agreed to in writing by the Buyer, each of the Sellers acknowledges and
agrees, severally but not jointly, that such Seller shall not, at any time
during the two (2) year period following the Closing Date, disclose any
Confidential Information (as hereinafter defined) to anyone other than to
employees and representatives of the Buyer. For purposes of this
Paragraph 8.1, the term "Confidential Information" shall mean all propri-
etary information which is not in or does not come into, the public domain
through any fault of such Seller or information which such Seller is
required by law or court order to disclose relating to the Company and its
Subsidiaries, their customers, products and services including, without
limitation, the following: (i) all technical information relating to the
provision of goods or services by the Company and its Subsidiaries; (ii)
information concerning pricing policies of the Company and its
Subsidiaries, prices charged by the Company and its Subsidiaries to their
customers, the volume of orders of such customers and all other
information concerning the transactions of the Company and its
Subsidiaries with their customers or proposed customers; (iii) the
customer lists of the Company and its Subsidiaries; (iv) information
concerning the marketing programs or strategies of the Company and its
Subsidiaries; (v) financial information concerning the Company and its
Subsidiaries; and (vi) information concerning salaries or wages paid to,
the work records of and other personal information relating to employees
of the Company and its Subsidiaries.
8.2. Enforcement. In addition to all other legal remedies
available to the Buyer for the enforcement of the covenants of this
Article VIII, each of the Sellers hereby agrees severally but not jointly,
that the Buyer shall be entitled to an injunction by any court of compe-
tent jurisdiction to prevent or restrain any breach or threatened breach
hereof. Each of the Sellers further agrees severally, but not jointly,
that if any of the covenants set forth herein shall at any time be
adjudged invalid to any extent by any court of competent jurisdiction,
such covenant shall be deemed modified to the extent necessary to render
it enforceable.
ARTICLE IX
Indemnification
9.1. Indemnification of the Buyer.
(a) Subject to the limitations, restrictions and conditions
set forth in this Agreement, each of the Sellers shall severally but not
jointly indemnify the Buyer and the Company and hold them harmless from
and against any and all damages, losses, deficiencies, actions,
judgements, costs expenses, debts, liabilities and obligations
(including reasonable attorneys' and accountants' fees) ("Claims") of or
against the Buyer or the Company resulting from or arising out of (i)
any misrepresentation or breach of any warranty made by such Seller (but
not by any other Seller) in Paragraphs 4.1.1, 4.1.2 or 4.1.3,
(regardless of whether such breach is deemed material for purposes of
Paragraph 2.1(a), above) above, or (ii) any nonfulfillment by such
Seller of any covenant or agreement which is to be performed by such
Seller (but only by such Seller) under this Agreement or any of the
Seller Ancillary Documents including, without limitation, the covenants
to be performed by such Seller in Paragraph 8.1, above.
(b) Subject to the limitations, restrictions and conditions
set forth in this Agreement, each of the Sellers shall severally but not
jointly indemnify the Buyer and hold it harmless from and against any
and all Claims of or against the Buyer or the Company resulting from or
arising out of (i) any misrepresentation or breach of any warranty made
by the Company in Paragraph 4.2 of this Agreement (regardless of whether
such breach is deemed material for purposes of Paragraph 2.1(a), above),
or any Claim based upon a fact or circumstance which would constitute a
breach of any warranty or representation set forth in Paragraph 4.2.21,
above, whether or not disclosed on the Disclosure Schedule (for purposes
hereof any such Claim shall be referred to as a "Deemed Environmental
Breach") or (ii) any nonfulfillment of any covenant or agreement on the
part of the Company under this Agreement which is to be performed by the
Company prior to the Closing.
9.2. Indemnification of the Sellers. The Buyer shall indemnify
the Sellers and hold them harmless from and against any and all Claims of
or against the Sellers resulting from or arising out of (i) any
misrepresentation or breach of warranty of the Buyer contained in this
Agreement or any of the Buyer Ancillary Documents on the part of the Buyer
(regardless whether such breach is deemed material for purposes of
Paragraph 2.2(a), above or (ii) the nonfulfillment of any covenant or
agreement on the part of the Buyer contained in this Agreement or any of
the Buyer Ancillary Documents.
9.3. Procedure Relative to Indemnification.
(a) In the event that any party hereto shall claim that it is
entitled to be indemnified pursuant to the terms of this Article IX, it
(the "Claiming Party") shall so notify the party against which the claim
is made (the "Indemnifying Party") in writing of such claim promptly
after discovery of the facts supporting the claim or receipt of a
written notice of any claim of a third party (a "Third Party Claim")
that may reasonably be expected to result in a claim by such party
against the party to which such notice is given, as the case may be.
Such notice shall specify the breach of representation, warranty,
covenant or agreement claimed by the Claiming Party and the liability,
loss, cost or expense incurred by or imposed upon or expected to be
incurred by or imposed upon the Claiming Party on account thereof. If
such liability, loss, cost or expense is liquidated in amount, the
notice shall so state. If the amount is not liquidated, the notice
shall so state and in such event a claim shall be deemed asserted
against the Indemnifying Party on behalf of the Claiming Party, but no
payment shall be made on account thereof until the amount of such claim
is liquidated and the claim is finally determined.
(b) The Indemnifying Party may, upon receipt of written
notice of a Third Party Claim and at its expense, defend such claim in
its own name or, if necessary, in the name of the Claiming Party, unless
the aggregate potential liability of the Claiming Party exceeds the
aggregate potential liability of the Indemnifying Party (calculated
assuming indemnification by the Indemnifying Party with reference to the
limitations set forth in Paragraph 9.5, below), in which event the
Indemnifying Party shall only have the right to defend the Third Party
Claim with the consent of the Claiming Party, but shall have the right
to participate at its expense in the defense thereof. The Claiming
Party will cooperate with and make available to the Indemnifying Party
such assistance and materials as may be reasonably requested of it, and
the Claiming Party shall have the right, at its expense, to participate
in the defense. The Indemnifying Party shall have the right to settle
and compromise such claim only with the consent of the Claiming Party
which consent shall not be unreasonably withheld. However, if the
Claiming Party fails to consent to such settlement or compromise offer,
the Indemnifying Party may continue to contest or defend such Third
Party Claim and, in such event, the maximum liability of the
Indemnifying Party as to such Third Party Claim will not exceed the
amount of such settlement or compromise offer.
(c) In the event the Indemnifying Party shall fail or not
have the right to assume the defense under Paragraph 9.3(b), above, or
shall notify the Claiming Party that it shall refuse to conduct a
defense against a Third Party Claim, then the Claiming Party shall have
the right to conduct a defense against such claim and shall have the
right to settle and compromise such claim with the consent of the
Indemnifying Party which consent shall not be unreasonably withheld.
Once the amount of such claim is liquidated and the claim is finally
determined, the Claiming Party shall be entitled to pursue each and
every remedy available to it at law or in equity to enforce the indemni-
fication provisions of this Article IX and, in the event such amount is
determined, or the Indemnifying Party agrees, that it is obligated to
indemnify the Claiming Party for such claim, the Indemnifying Party
agrees to pay all costs, expenses and fees, including all reasonable
attorneys' fees which may be incurred by the Claiming Party in
attempting to enforce indemnification under this Article IX, whether the
same shall be enforced by suit or otherwise.
(d) Upon judgment, determination, settlement or compromise of
any Third Party Claim, the Indemnifying Party shall pay on behalf of the
Claiming Party, and/or to the Claiming Party in reimbursement of any
amount theretofore required to be paid by the Claiming Party, the amount
so determined by judgment, determination, settlement or compromise and
all other Claims of the Claiming Party with respect thereto within
fifteen (15) days of the date of such judgment, determination,
settlement or compromise, unless in the case of a judgment an appeal is
made from the judgment. If the Indemnifying Party desires to appeal
from an adverse judgment, then the Indemnifying Party shall post and pay
the cost of the security or bond to stay execution of the judgment
pending appeal.
9.4. Effect of Taxes, Other Benefits and Insurance. The
determination of any liability, claim, lien, encumbrance, charge, fine or
penalty for which indemnification may be claimed under this Article IX
shall be net of insurance proceeds received (but also net of recovery
costs and adjusted for any tax incurred as a result of the receipt of such
insurance proceeds except to the extent of any tax benefits received from
the loss which gave rise to such insurance proceeds) by the party bearing
such liability, claim, lien, encumbrance, charge, fine or penalty as a
result thereof.
9.5. Limits on Indemnification Claims.
9.5.1. Basket. Except with respect to Claims for breaches of the
warranties or representations contained in Paragraph 4.1 or in Paragraph
4.2.10(b)(v), the Sellers shall not be required to provide indemnification
under Paragraph 9.1, above: (i) unless the damages of the Buyer for all
Claims of indemnification under Paragraph 9.1, except for breaches of the
warranties and representations contained in Paragraph 4.2.21 and Deemed
Environmental Breaches, shall exceed in the aggregate Seven Hundred Fifty
Thousand Dollars ($750,000.00), (the "Non-Environmental Basket Amount")
and then only for amounts in excess of the Non-Environmental Basket
Amount; and (ii) unless the damages of the Buyer (excluding any costs
related to environmental consultants and audits) for breaches of the
warranties and representations set forth in Paragraph 4.2.21 and Deemed
Environmental Breaches shall exceed in the aggregate Two Hundred Fifty
Thousand Dollars ($250,000.00) (the "Environmental Basket Amount") and
then only for amounts in excess of the Environmental Basket Amount.
9.5.2. Maximum Amount of Indemnification.
(a) Except with respect to Claims (i) for breaches of the
warranties or representations contained in Paragraph 4.1, or (ii) for
breaches of the warranties or representations contained in Paragraph
4.2.21 or for Deemed Environmental Breaches (as to both of which the
limits in Paragraph 9.5.2(b), shall apply), in no event shall: (A) the
aggregate liability of all of the Sellers with respect to all Claims of
indemnification by the Buyer exceed the aggregate amount of Three
Million Seven Hundred Fifty Thousand Dollars ($3,750,000.00), (the "Cap
Amount"), and (B) the liability of any Seller with respect to all Claims
of indemnification exceed the product of the Cap Amount and the
percentage set forth opposite such Seller's name on Schedule 1 attached
hereto.
(b) With respect to any Claim based upon breaches of the
warranties or representations contained in Paragraph 4.2.21 or a Deemed
Environmental Breach, the following shall apply: (i) the Sellers shall
be responsible for providing indemnification to the Buyer under this
Article IX, subject to the Environmental Basket Amount, in an amount
equal to fifty percent (50%) of the amount of the Buyer's Claims for
breach of such warranty or representation or Deemed Environmental Breach
until the aggregate liability of the Sellers for breach of such warranty
or representation or Deemed Environmental Breach equals Three Million
Seven Hundred Fifty Thousand Dollars ($3,750,000.00), at which time the
Sellers shall have no further liability for breach of such warranty or
representation or Deemed Environmental Breach; and (ii) each Seller
shall be responsible for an amount equal to the product of the liability
of all Sellers under clause (i), above, and the percentage set forth
opposite such Seller's name on Schedule 1 attached hereto.
(c) Subject to the limitations in Paragraphs 9.5.2(a) and
9.5.2(b), the liability of any Seller with respect to any individual
Claim of indemnification shall in no event exceed an amount equal to the
product of the amount of such Claim and the percentage set forth
opposite such Seller's name on Schedule 1 attached hereto.
9.6. Sole Remedy; Termination. The sole remedy of the Buyer for
any and all claims against the Sellers with respect to the transactions
contemplated herein, whether under or as a result of this Agreement or
otherwise, shall be the indemnity set forth in this Article IX, as limited
by the provisions set forth in this Article IX. Any claim for
indemnification not submitted in writing by the Buyer prior to the
expiration of the applicable survival period of the warranty,
representation or covenant on which such claim is based shall be deemed to
have been waived and the Sellers shall have no further liability with
respect thereto.
9.7. No Indemnification for Known Breaches of Representations and
Warranties. Notwithstanding any of the provisions set forth in this
Article IX, above, and except for the warranties and representations set
forth in Paragraph 4.2.21 or 4.2.10(b)(v) of this Agreement, in the event
that the Buyer had knowledge, on or before the Closing Date, of the facts
giving rise to a claim hereunder, then the Sellers shall have no liability
for any loss resulting from or arising out of such facts. In addition,
Buyer shall deliver to Sellers, and attach to this Agreement at Closing, a
statement of any facts known to Buyer at Closing and not disclosed by the
Company as part of the Disclosure Schedule which could give rise to a
claim under this Article IX but for the provisions of this Paragraph 9.7.
ARTICLE X
Termination
10.1. Termination. This Agreement may be terminated at any time
prior to the Closing Date:
(a) by the mutual written consent of the Buyer and the
Sellers;
(b) by the Buyer, or the Sellers;
(i) if any court or governmental body or agency thereof
shall have enacted, promulgated or issued any statute, rule,
regulation, ruling, writ or injunction, or taken any other action,
restraining, enjoining or otherwise prohibiting the transactions
contemplated hereby; or
(ii) if the Closing shall not have occurred on or before
October 31, 1996; provided, however, that the right to terminate
this Agreement pursuant to this Paragraph 10.1(b)(ii) shall not be
available to any party whose breach of any representation or war-
ranty or failure to perform or comply with any covenant or
obligation under this Agreement has been the cause of, or resulted
in, the failure of the Closing to occur on or before such date; or
(c) by the Buyer if the DOJ or FTC shall issue a "second
request" to the Buyer, or the Sellers or the Company shall breach this
Agreement; or
(d) by the Sellers if the DOJ or FTC shall issue a "second
request" to the ultimate parent entity of the Company or the Buyer shall
breach this Agreement; or
(e) by the Buyer pursuant to Article VII.
10.2. Effect of Termination. In the event of termination of this
Agreement, this Agreement shall forthwith become null and void and there
shall be no liability on the part of any party hereto, except for
Paragraphs 11.1, 11.2 and 11.9 hereof and this Paragraph 10.2, which shall
remain in full force and effect and which shall survive such termination,
and provided that no such termination shall relieve any party hereto from
liability for any breach by such party of this Agreement.
ARTICLE XI
Miscellaneous
11.1. Expenses. Except as may be otherwise specifically provided
herein, the parties hereto shall pay their own legal fees and expenses
incurred in connection with the negotiation and consummation of the
transactions contemplated by this Agreement, provided that the Company
shall pay all previously billed fees and expenses of ▇▇▇▇▇▇▇ & ▇▇▇▇, S.C.
and ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, LLP related to this transaction, all verifiable
unbilled fees and expenses of ▇▇▇▇▇▇▇ & ▇▇▇▇, S.C. in an amount not to
exceed Six Hundred Thousand Dollars ($600,000.00) and all verifiable
unbilled fees and expenses of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, LLP not to exceed One
Hundred Thousand Dollars ($100,000.00). The Sellers shall be severally
responsible for any fees payable to ▇▇▇▇▇▇ ▇. ▇▇▇▇▇ & Co. Incorporated in
connection with the transactions contemplated herein other than the
retainer and expenses previously paid by the Company. The Buyer shall be
responsible for any fees payable to any brokers, consultants, or other
agents retained by the Buyer in connection with the transactions
contemplated herein.
11.2. Notices. All notices or other communications required or
permitted to be given hereunder shall be in writing and shall be
considered to be given and received in all respects when hand delivered,
when sent one (1) business day after it is sent by prepaid express or
courier delivery service, when sent by facsimile transmission actually
received by the receiving equipment, or five (5) days after it is
deposited in the United States mail, certified mail, postage prepaid,
return receipt requested (or international equivalents thereof), in each
case addressed as follows, or to such other address as shall be designated
by notice duly given:
IF TO THE BUYER: Oshkosh Truck Corporation
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇.▇. ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: R. ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Chief Executive Officer
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
With a Copy To: ▇▇▇▇▇ & Lardner
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, III
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
IF TO THE COMPANY: ▇▇▇▇▇▇ Manufacturing Inc.
▇.▇. ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇,
President
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
With a Copy To: ▇▇▇▇▇▇▇ & ▇▇▇▇, S.C.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
IF TO THE SELLERS: c/o Northwestern Mutual Life Insurance Company
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: A. ▇▇▇▇ ▇▇▇▇▇▇▇,
Vice-President
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
With a Copy To: ▇▇▇▇▇▇▇ & ▇▇▇▇, S.C.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
11.3. Entire Agreement. This Agreement, the Disclosure Schedule,
the exhibits attached hereto and the agreements executed and delivered
simultaneously herewith constitute the entire agreement among the parties
hereto relating to the subject matter hereof, and all prior agreements,
correspondence, discussions and understandings of the parties (whether
oral or written) are merged herein and superseded hereby, it being the
intention of the parties hereto that this Agreement and the instruments
and agreements contemplated hereby shall serve as the complete and
exclusive statement of the terms of their agreement together. No
amendment, waiver or modification hereto or hereunder shall be valid
unless in writing signed by an authorized signatory of the party or
parties to be affected thereby.
11.4. Assignment. This Agreement and the rights hereunder shall
not be assignable or transferrable (i) by the Buyer without the prior
written consent of the Sellers or (ii) by the Company or any of the
Sellers without the prior written consent of the Buyer.
11.5. Binding Effect. This Agreement shall be binding upon the
parties hereto and their respective successors and permitted assigns.
11.6. Paragraph Headings. The headings in this Agreement are for
purposes of convenience and ease of reference only and shall not be
construed to limit or otherwise affect the meaning of any part of this
Agreement.
11.7. Severability. The parties agree that if any provision of
this Agreement shall under any circumstances be deemed invalid or
inoperative, this Agreement shall be construed with the invalid or
inoperative provision deleted, and the rights and obligations of the
parties shall be construed and enforced accordingly.
11.8. Applicable Law. This Agreement and all questions arising in
connection herewith shall be governed by and construed in accordance with
the internal laws of the State of Wisconsin without regard to the
principles of conflicts of laws thereunder.
11.9. Counterparts. This Agreement may be executed in one or more
original or facsimile counterparts, all of which shall be considered but
one and the same agreement, and shall become effective when one or more
such counterparts have been executed by each of the parties and delivered
to the other parties.
11.10. Passage of Title. Legal title, equitable title and risk of
loss with respect to the Subject Shares will not pass to the Buyer until
the Subject Shares are transferred at the Closing, which transfer, once it
has occurred, will be deemed effective as of 12:01 AM, Milwaukee,
Wisconsin time, on the Closing Date for all purposes.
11.11. Use of Terms. In this Agreement, (a) the words "hereof,"
"herein," "hereto," "hereunder" and words of similar import mean and refer
to this Agreement as a whole and not merely to the specific section,
paragraph or clause in which the respective word appears, (b) words
importing gender include the other genders and (c) any terms defined in
this Agreement may, unless the context otherwise requires, be used in the
singular or the plural depending on the reference.
IN WITNESS WHEREOF, the parties have executed this Agreement as of
the day, month and year first above written.
THE COMPANY:
▇▇▇▇▇▇ MANUFACTURING INC.
_____________________________________
By: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Its President
SELLERS:
THE NORTHWESTERN MUTUAL LIFE INSURANCE COMPANY
_____________________________________
By: ______________, Its______________
▇▇▇▇▇▇ ▇. ▇▇▇▇▇ & CO. INCORPORATED
_____________________________________
By: ______________, Its______________
THE ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ AND ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ JOINT
REVOCABLE TRUST DATED SEPTEMBER 23, 1993
By: ________________________________
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Trustee
THE ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ IRREVOCABLE TRUST, DATED
SEPTEMBER 23, 1993, f/b/o ▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ &
Ilsley Trust Company, Successor Trustee
By: ________________________________
Name: _______________________________
Title: ______________________________
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ IRREVOCABLE CHARITABLE REMAINDER
UNITRUST, F&M Bank of Kaukauna, Trustee
By: ________________________________
Name: _______________________________
Title: ______________________________
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▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ TRUST DATED OCTOBER 13, 1987
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By: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇, Trustee
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▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
WINDFALLS UNLIMITED, LLC
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By: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Manager
BUYER:
OSHKOSH TRUCK CORPORATION
______________________________________
By: _______________, Its______________
THE ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ IRREVOCABLE TRUST, DATED
SEPTEMBER 23, 1993, f/b/o ▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ &
Ilsley Trust Company, Successor Trustee
By: ________________________________
Name: _______________________________
Title: ______________________________
_____________________________________
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ LIMITED PARTNERSHIP DATED MAY 31,
1996
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By: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, General Partner
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ CHARITABLE REMAINDER UNITRUST, F&M
Bank of Kaukauna, Trustee
By: ________________________________
Name: _______________________________
Title: ______________________________
_____________________________________
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
FAITH LIMITED PARTNERSHIP DATED MAY 31, 1996
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By: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, General Partner