______________________________________________________________________________
AMENDED AND RESTATED
PURCHASE AGREEMENT
Dated as of October 25, 1996
Among
UT AUTOMOTIVE, INC.,
UNITED TECHNOLOGIES AUTOMOTIVE SYSTEMS, INC.,
UNITED TECHNOLOGIES
AUTOMOTIVE SYSTEMS de MEXICO S.A. de C.V.,
IPCO, INC.
and
BREED TECHNOLOGIES INC.
_____________
______________________________________________________________________________
TABLE OF CONTENTS
SECTION 1. CLOSING
SECTION 2. PURCHASE AND SALE OF ASSETS, THE SHARES AND THE HANKOOK INTEREST
2.1 Transferred Assets
2.2 Excluded Assets
2.3 The Shares
2.4 The Hankook Interest
2.5 Intellectual Property
3.1 Purchase Price
3.2 Allocation
3.3 Delivery and Payment
3.4 ▇▇▇▇▇▇▇▇ Intercompany Financing Discharge
SECTION 4. LIABILITIES
4.1 Assumed Liabilities
4.2 Retained Liabilities
SECTION 5. REPRESENTATIONS AND WARRANTIES OF THE SELLERS
5.1 Corporate Organization
5.2 (a) ▇▇▇▇▇▇▇▇ Share Ownership
(b) ▇▇▇▇▇▇▇▇ Intercompany Financing
5.3 UTAS' Interest in Hankook-▇▇▇▇▇▇▇
5.4 Authority
5.5 ▇▇▇▇▇▇▇▇ Subsidiaries
5.6 Material Adverse Changes
5.7 Title to Steering Wheels N.A. Business Assets
5.8 Title to ▇▇▇▇▇▇▇▇ Assets and Properties
5.9 Real Property and Leases
5.10 Compliance with Law
5.11 Financial Statements
5.12 Material Contracts
5.13 Taxes
5.14 Disputes
5.15 Brokers and Finders
5.16 Collective Bargaining Agreements, Employment Agreements and
Benefit Plans
5.17 ERISA; Employee Benefits
5.18 Intellectual Property
5.19 Consents
5.20 Accounts Receivable
5.21 Employment Records
5.22 Notification by Sellers of Transfer of Indiana Property
5.23 Condition of Transferred Assets
5.24 No Other Representations or Warranties
SECTION 6. REPRESENTATIONS AND WARRANTIES OF THE BUYER
6.1 Organization, Good Standing and Corporate Power
6.2 Authority
6.3 Consents of Buyer
6.4 Acquisition of Shares
6.5 Brokers and Finders
6.6 Financing
6.7 Condition of Transferred Assets
6.8 Non-reliance
SECTION 7. INFORMATION AND RECORDS CONCERNING THE SELLERS
7.1 The Buyer's Access to Information and Records
7.2 Parties' Access to Records After Closing
7.3 Disposal of Records
SECTION 8. OBLIGATIONS AND COVENANTS
8.1 Sellers' Conduct of the Business
8.2 Provision of Transitional Computer Services
8.3 Provision for Transitional Employee Benefits
8.4 Provision of Transitional Administrative Services
8.5 Lease of Office Space in ▇▇▇▇▇▇ Street Facility
8.6 Lease of Factory and Office Space in Monterrey, Mexico
Facility and License of Warehouse in Laredo, Texas
8.7 Lease of Niles, Michigan Manufacturing Facility
8.8 Niles Employees
8.9 Filings
8.10 Payment of ▇▇▇▇▇▇▇▇ Intercompany Financing
8.11 Supply Agreements
8.12 Retained Liabilities
SECTION 9. EMPLOYMENT AND EMPLOYEE BENEFIT ARRANGEMENTS
9.1 Offer of Employment
9.2 Continuation of Employee Benefits
9.3 Salaried Employees Retirement Plan
9.4 United Technologies Corporation Employee Savings Plan
9.5 Grabill Plan
9.6 Welfare Plans
9.7 Plant Closings
9.8 Service Under Buyer's Plans
9.9 Treatment of Buyer and Sellers
9.10 Assumption of Monterrey Collective Bargaining Agreement
SECTION 10. CONDITIONS OF CLOSING
10.1 Conditions of the Buyer's Obligations
10.2 Conditions of the Sellers' Obligations
SECTION 11. CLOSING DOCUMENTS
11.1 (a) The Sellers' Obligations
(b) IPCO's Obligation
11.2 The Buyer's Obligations
SECTION 12. CLOSING EXPENSES AND APPORTIONMENTS
12.1 Sales Tax and Other Closing Expenses
12.2 Apportionments
12.3 Obligation to Pay Adjusted Final Purchase Price
SECTION 13. POST CLOSING SURVIVAL AND INDEMNIFICATION
13.1 Survival
13.2 The Sellers' Indemnification
13.3 The Buyer's Indemnification
13.4 Environmental Indemnification
13.5 Exclusive Remedy
13.6 Lost Profits and Special Damages
SECTION 14. TERMINATION
14.1 Termination of Agreement
14.2 Effect of Termination
14.3 Return of Information
SECTION 15. USE OF TRADEMARKS AND TRADE NAMES
15.1 Trademarks and Trade Names
15.2 Representations as to Products
SECTION 16. MISCELLANEOUS
16.1 Public Announcements
16.2 Costs and Expenses
16.3 Passage of Title and Risk of Loss
16.4 Waiver of Compliance with Bulk Sales Law
16.5 Knowledge of Sellers
16.6 Notices
16.7 Exhibits
16.8 Successors and Assigns
16.9 Further Actions
16.10 Waiver, Discharge, Amendment, Etc.
16.11 Captions
16.12 Governing Law
16.13 Jurisdiction and Venue
16.14 Rights of Persons Not Parties
16.15 Counterparts
16.16 Entire Agreement
16.17 Severability
16.18 Non-Competition Agreement
16.19 No Solicitation or Hiring of Former Employees
INDEX OF DEFINED TERMS AMENDED AND RESTATED PURCHASE AGREEMENT
This Amended and Restated Purchase Agreement (this "Agreement") is made as of
October 25, 1996, between UT AUTOMOTIVE, INC., a Delaware corporation ("UTA"),
and UNITED TECHNOLOGIES AUTOMOTIVE SYSTEMS, INC., an Ohio corporation ("UTAS"),
both with an office at ▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇,
and UNITED TECHNOLOGIES AUTOMOTIVE SYSTEMS de MEXICO S.A. de C.V., a
Mexican corporation ("UTAS de Mexico"), with an office at ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
#126, Colonia ▇▇▇▇▇ ▇▇▇▇▇▇, Santa Catarina, N.L. Cp. 66360, Monterrey, Mexico
(jointly the "Sellers") and IPCO, INC., a Delaware corporation ("IPCO"), with an
▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ and BREED
TECHNOLOGIES, INC., a Delaware corporation (the "Buyer"), with an office at ▇▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇.
W I T N E S S E T H :
WHEREAS, Sellers are engaged in an ongoing business of developing,
manufacturing, marketing and distributing automotive and industrial steering
wheels, air bag covers, horn pads, and related molded products in North America
(the "Steering Wheels N.A. Business") and in Europe, through United Technologies
Automotive ▇▇▇▇▇▇▇▇ Limited, an English company ("▇▇▇▇▇▇▇▇"); the Steering
Wheels N.A. Business and the operations of ▇▇▇▇▇▇▇▇ are hereinafter collectively
referred to as the "Business";
WHEREAS, the Steering Wheels N.A. Business operates manufacturing and assembly
plants in Grabill, Indiana; Niles, Michigan; and Monterrey, Mexico (a facility
shared with other businesses of Sellers);
WHEREAS, the Steering Wheels N.A. Business is consolidating its operations and
intends to close the Niles, Michigan plant and resource that work to the
Grabill, Indiana plant;
WHEREAS, the assets associated with the Steering Wheels N.A. Business are owned
by either UTAS or UTAS de Mexico;
WHEREAS, ▇▇▇▇▇▇▇▇ operates two manufacturing and assembly plants in Birmingham,
England;
WHEREAS, UTA directly owns all of the issued ordinary shares of ▇▇▇▇▇▇▇▇ (the
▇▇▇▇▇▇▇▇ shares are hereinafter referred to as the "Shares");
WHEREAS, pursuant to a joint venture, UTAS owns approximately thirty-one percen
(31%) of the issued and outstanding common stock of Hankook-▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Hoesa, a Korean corporation ("Hankook"), which produces steering wheels and
certain automotive trim parts (the "Hankook Interest");
WHEREAS, IPCO is the owner of the Patent Rights (as defined herein) applicable
to the Steering Wheels N.A. Business and desires to assign such Patent Rights to
the Buyer;
WHEREAS, Sellers are the owners of or have the right to license the Know-how (as
defined herein) related to the Steering Wheels N.A. Business and desire to
license, on a non-exclusive basis, such Know-how to the Buyer;
WHEREAS, Buyer, upon completion of all conditions of transfer as set forth in
the Patent Assignment, will be the owner of the Patent Rights and desires to
grant back to the Sellers the Patent Rights on a non-exclusive basis for use in
Sellers' operations other than the Steering Wheels N.A. Business, without the
right to sublicense such Patent Rights for Competing Product applications (as
described in the Patent License-Back Agreement);
WHEREAS, the Sellers desire to sell and the Buyer desires to purchase the assets
used by UTAS or UTAS de Mexico in the Steering Wheels N.A. Business, the Patent
Rights of IPCO, the Know-how of UTAS and UTAS de Mexico (the Patent Rights of
IPCO and the Know-how of UTAS and UTAS de Mexico are herein collectively
referred to as the "Intellectual Property"), the Shares and, subject to Section
2.4 below, the Hankook Interest, all subject to the Buyer's assumption of
certain liabilities and in accordance with the terms and conditions
hereinafter set forth; and
WHEREAS, Sellers, IPCO and Buyer have executed the Purchase Agreement, dated as
of September 20, 1996 (the "Original Purchase Agreement"), and the Revised
Purchase Agreement, dated as of September 30, 1996 (the "Revised Purchase
Agreement") revising and restating the Original Purchase Agreement and now
desire to amend and restate the Revised Purchase Agreement, including Exhibits
2.1(a), 5.10, 5.14 and 9.1 thereto;
NOW, THEREFORE, in consideration of the foregoing, the representations,
warranties, covenants and agreements hereinafter set forth and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Sellers and the Buyer hereby mutually agree as follows:
SECTION 1. CLOSING
Subject to the satisfaction of the conditions to the obligations of the parties
expressly contained herein, the closing of the transactions contemplated by this
Agreement (hereinafter called the "Closing") shall take place at the offices of
Cleary, Gottlieb, ▇▇▇▇▇ & ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇,
at 10:00 a.m., local time, on Friday, October 25, 1996, provided that all the
approvals, consents, and other conditions set forth in Sections 10.1 and 10.2 of
the Agreement have been obtained, waived or satisfied. The date of Closing is
referred to herein as the "Closing Date." The Closing shall be deemed to have
occurred at 11:59 p.m. on the Closing Date.
SECTION 2. PURCHASE AND SALE OF ASSETS,
THE SHARES AND THE HANKOOK INTEREST
2.1 Transferred Assets
Subject to the terms and conditions hereof, at the Closing the Sellers shall
sell, assign, convey, transfer and deliver to the Buyer and the Buyer shall
purchase, for the purchase price set forth in Section 3 hereof, all right, title
and interest of UTAS and UTAS de Mexico in the assets, properties and rights, of
every kind, nature and description, whether tangible or intangible, exclusively
or predominantly used by UTAS and UTAS de Mexico in the Steering Wheels N.A.
Business excluding the Excluded Assets (as defined below). The term
"predominantly", when used in connection with the use by UTAS or UTAS de Mexico
of such assets, properties and rights, shall mean a good faith estimate by the
parties that such assets, properties and rights are used 60 percent of the time
in the Steering Wheels N.A. Business. Such assets, properties and rights,
excluding the Excluded Assets, are hereinafter referred to as the "Transferred
Assets", and consist of the following:
(a) one parcel of land located in Grabill, Indiana, more particularly described
in Exhibit 2.1(a) attached hereto and all buildings, structures, fixtures and
improvements located thereon (the "Real Property");
(b) except as set forth in Exhibit 2.1(b), all machinery, fixtures, equipment,
motor vehicles, furniture, tools, spare parts, blueprints, test equipment, and
other tangible personal property which are owned by UTAS or UTAS de Mexico or
in which UTAS or UTAS de Mexico has valid leasehold interests and are used
solely or predominantly in connection with the Steering Wheels N.A. Business,
except for personal property consumed or disposed of in the ordinary course of
business between the date hereof and the Closing Date;
(c) subject to the restrictions on use set forth in Section 15, all inventories,
raw material, work-in-process, finished goods and consigned-out inventories,
supplies, sales literature, promotional literature, customer lists and other
data solely or predominantly associated with the Steering Wheels N.A. Business
and pertaining solely or predominantly to the Steering Wheels N.A. Business,
except for that which is consumed or disposed of in the ordinary course of
business between the date hereof and the Closing Date;
(d) all rights, claims and benefits of UTAS or UTAS de Mexico under all
contracts and agreements predominantly relating to the Steering Wheels N.A.
Business, including leases (including of both real and personal property),
purchase orders and other agreements in effect on the Closing Date, to the
extent that the same are assignable (collectively, the "Assigned Contracts"),
other than those specifically not transferred by UTAS or UTAS de Mexico or
retained by UTAS or UTAS de Mexico and described in Section 2.2 hereof. Such
agreements (exclusive of purchase orders) having a nominal value in excess of
One Hundred Thousand Dollars ($100,000) are listed in Exhibit 2.1(d) hereto;
(e) all items of prepaid expense solely related to the Business as of the
Closing Date (excluding, however, any of such prepaid items related to the
Excluded Assets), subject to apportionment at Closing as provided in Section
12.2 hereof;
(f) all rights of UTAS and UTAS de Mexico as of the Closing Date under or
pursuant to all warranties, representations and guarantees made by suppliers in
connection with the Steering Wheels N.A. Business' products, Transferred
Assets or services furnished to UTAS or UTAS de Mexico pertaining to the
Steering Wheels N.A. Business or affecting the Steering Wheels N.A.
Business's products or Transferred Assets (net of any indemnities provided
therein) to the extent such warranties, representations, and guarantees are
assignable;
(g) the equipment and assets associated solely or predominantly with the
steering wheel operations in the Monterrey, Mexico plant;
(h) except as set forth in Exhibit 2.1(h), all notes and accounts receivable
solely related to the Steering Wheels N.A. Business (other than the intercompany
and/or intracompany accounts of UTAS) as of the Closing Date; and
(i) title to all UTAS and UTAS de Mexico's records, files and papers pertaining
to any of the assets, liabilities or operations of the Steering Wheels N.A.
Business as of the Closing Date or to the transactions contemplated herein,
including, but not limited to, manuals and data, sales and purchase
correspondence, books of account, plans, financial records, shipping records and
accounting records, wherever located (collectively, the "Records"). Buyer shall
provide UTAS and UTAS de Mexico with reasonable access to the Records during the
Buyer's regular business hours. In the event the Buyer desires to destroy the
Records, the Buyer shall notify UTAS and UTAS de Mexico in writing thereof not
less than sixty (60) days prior to such destruction and UTAS or UTAS de Mexico
shall have the right to take possession of the Records and assume responsibility
for the care and custody thereof.
2.2 Excluded Assets
Notwithstanding the provisions of Section 2.1, the following assets of UTAS or
UTAS de Mexico relating to the Steering Wheels N.A. Business (herein the
"Excluded Assets") shall be retained by UTAS or UTAS de Mexico and shall not be
sold or transferred to the Buyer as part of this transaction on the Closing
Date:
(a) all assets, properties, rights and businesses of UTAS and UTAS de Mexico, of
every type and description, not used solely or predominately in connection with
the Steering Wheels N.A. Business;
(b) all contracts, agreements, leases, licenses, commitments and undertakings
that terminate or expire prior to or on the Closing Date in accordance with
their terms or that are non-transferable, non-discloseable or non-assignable in
accordance with their terms without limitation of the provisions set forth in
Section 4.1;
(c) all cash, deposits, bank accounts, certificates of deposit and other cash
equivalents as of the Closing Date;
(d) all prepaid insurance, including all related rights to the refund of
unearned premiums as of the Closing Date;
(e) all notes and accounts receivable which are listed on Exhibit 2.1(h), if
any;
(f) all rights, claims and benefits under all performance bonds, surety bonds
and insurance policies with respect to the Steering Wheels N.A. Business
conducted prior to the Closing Date including, without limitation, all rights,
claims and benefits under insurance policies related to all matters against
which the Sellers have agreed to indemnify the Buyer under Section 13 and for
all Retained Liabilities as described in Section 4.2;
(g) all intercompany accounts with its affiliates and/or intracompany accounts
of UTAS;
(h) all rights to a refund of any federal or state income or franchise tax
payments with respect to the Steering Wheels N.A. Business conducted prior to
the Closing Date;
(i) title to and custody of all minute books, stock books, shareholders lists
and similar corporate records of UTAS and UTAS de Mexico, and all tax records of
UTAS and UTAS de Mexico;
(j) other than as required for Sellers to fulfill its obligations concerning the
name "▇▇▇▇▇▇▇" in the name of the Hankook-▇▇▇▇▇▇▇ Joint Venture under Section
2.4, any right to the name "United Technologies Corporation", "United
Technologies Automotive", "United Technologies Automotive Systems, Inc."
"UTC", "UTA", "UTAS", "UT Automotive, Inc.", "▇▇▇▇▇▇▇-Globe", "SG" or
any other trademark, trade name or service ▇▇▇▇ of UTAS, UTAS's parent or
affiliated companies or any variants thereof whether or not the same are or are
part of any trademark, trade name, service ▇▇▇▇, brand name, brand ▇▇▇▇ or
copyright (whether or not registered);
(k) all funds held in trust or under insurance contracts, benefit plans or
similar arrangements for the purpose of providing retirement benefits, welfare
benefits, deferred compensation or other employee benefits for employees of the
Steering Wheels N.A. Business;
(l) any amounts accrued on the books and records of UTAS and UTAS de Mexico
on the Closing Date which relate to or offset liabilities which are Retained
Liabilities;
(m) any contracts or agreements specifically retained by UTAS and set forth on
Exhibit 2.2(m);
(n) the Niles, Michigan; Detroit, Michigan; and Monterrey, Mexico real property;
(o) any rights (including indemnification) of the Sellers pursuant to agreements
with TRACE, Inc., the former owner of the Sellers; and
(p) the lease on the real property located in Laredo, Texas.
2.3 The Shares
Subject to the terms and conditions hereof, at the Closing UTA shall sell,
assign, convey, transfer and deliver to the Buyer or an affiliate of Buyer as
Buyer shall designate and the Buyer or such designated affiliate, if any, shall
purchase, for a portion of the purchase price set forth in Section 3 hereof,
all right, title and interest of UTA in the Shares.
2.4 The Hankook Interest
Subject to the terms and conditions hereof and its obligations under the right
of first refusal contained in the Hankook-▇▇▇▇▇▇▇ Joint Venture Agreement (the
"Joint Venture Agreement"), UTAS shall sell, assign, convey, transfer and
deliver to the Buyer and the Buyer shall purchase, for a portion of the purchase
price set forth in Section 3 hereof, all right, title and interest of UTAS in
the Hankook Interest. If the Korean investors in the Hankook-▇▇▇▇▇▇▇ Joint
Venture elect to exercise such right of first refusal, UTAS would pay Buyer the
amount received from such Korean investors as a reduction of the final purchase
price.
2.5 Intellectual Property
The parties hereto agree to enter into good faith negotiations with the
intention to execute upon Closing (1) the Patent Assignment under which IPCO
will assign to Buyer the United States and foreign patents, pending patent
applications and invention disclosures substantially as described in Exhibit 2.5
attached hereto (the "Patent Rights"), (2) the Know-how License Agreement under
which UTAS and UTAS de Mexico will license, on a non-exclusive basis, the
know-how, trade secrets and technical information relating to the use of the
Patent Rights in connection with the Steering Wheels N.A. Business (the
"Know-how"), and (3) the Patent License-Back Agreement under which the Buyer
will grant back to the Sellers the Patent Rights, on a non-exclusive basis, for
use in Sellers' operations other than the Steering Wheels N.A. Business, without
the right to sublicense such Patent Rights for Competing Product applications
(as defined in Section 16.18).
SECTION 3. PURCHASE PRICE
3.1 Purchase Price
The aggregate purchase price for the Shares, the Hankook Interest and the
Transferred Assets shall be One Hundred Twenty Three Million Eighty-One Thousand
Six Hundred Eighty-One and 63/100 Dollars ($123,081,681.63) (the "Cash Purchase
Price"), plus the Assumed Liabilities as hereafter defined in Section 4.1 of
this Agreement assumed by the Buyer pursuant to this Agreement, subject,
however, to a post-closing adjustment of the Cash Purchase Price as set forth in
Section 3.1(b) below.
(a) The Buyer shall pay to the Sellers or their designee at Closing the Cash
Purchase Price in the form of a wire transfer of immediately available funds to
the accounts designated by the Sellers. The Buyer shall also, immediately
following the transfer of the Shares, pay the ▇▇▇▇▇▇▇▇ Payees(as defined herein)
an amount equal to the ▇▇▇▇▇▇▇▇ Intercompany Financing (as defined herein) in
immediately available funds to the accounts designated in the ▇▇▇▇▇▇▇▇ Notice
(as defined herein).
(b) Attached hereto as Exhibit 3.1(b) is the combined statement of net assets
for sale of the Steering Wheels N.A. Business and ▇▇▇▇▇▇▇▇ as of July, 1996
fiscal month-end (the "Interim Balance Sheet") that reflects the net working
capital amount of $17,016,481 (the "Interim Net Working Capital"). Net working
capital shall mean net current assets less net current liabilities as set forth
on the Interim Balance Sheet and the Closing Date Balance Sheet (as hereafter
defined). The Sellers will prepare and deliver to the Buyer, on or before the
sixtieth (60th) calendar day following the Closing Date, a combined statement
of net assets for sale as of the Closing Date (the "Closing Date Balance Sheet")
that will reflect the net working capital amount as of the Closing Date (the
"Closing Date Net Working Capital"). Both the Interim Balance Sheet and the
Closing Date Balance Sheet shall be prepared consistently and in accordance
with the Sellers' historical accounting practices except as noted. As used
throughout this Agreement, the phrase "in accordance with the Sellers'
historical accounting practices" shall mean in accordance with the Sellers'
historical accounting practices, which shall be, in all material respects, in
accordance with U.S. Generally Accepted Accounting Principles. The Buyer
shall permit and allow representatives of the Sellers to have full access to the
books, records, facilities and employees of the Business as may be required for
the purpose of preparation of the Closing Date Balance Sheet (including the
taking of inventories).
(c) Within twenty (20) business days after the Adjusted Final Purchase Price has
been determined by the parties or by the independent auditor (as hereinafter
provided for), whichever is later, the amount of the adjustment in the Cash
Purchase Price shall be paid by the Buyer to the Sellers, or by the Sellers to
the Buyer, as the case may be, by wire transfer of immediately available funds.
The amount of the adjustment in the Cash Purchase Price shall be paid together
with interest thereon at a per annum rate equal to the thirty (30) day
commercial paper rate published in the Wall Street Journal on the Closing Date
(which rate is attached hereto as Schedule 1). Such interest shall accrue and
be calculated from the Closing Date through the date of any payment of such
adjustment in the Cash Purchase Price.
If the Buyer shall disagree with the Closing Date Balance Sheet and the Closing
Date Net Working Capital amount, it shall notify the Sellers of such
disagreement in writing specifying in detail the particulars of such
disagreement within twenty (20) business days after the Buyer's receipt of the
Closing Date Balance Sheet. Buyer may only disagree with the Closing Date Net
Working Capital amount on the basis that the Closing Date Balance Sheet has not
been prepared in accordance with Sellers' historical accounting practices and is
not consistent with the preparation of the Interim Balance Sheet. Any such
disagreement shall be certified by Buyer's independent auditor. The Buyer and
the Sellers then shall use their best efforts for a period of thirty (30)
calendar days after receipt of such notice (or such longer period as the Buyer
and the Sellers shall mutually agree upon) to resolve any such disagreements
raised by the Buyer. If, at the end of such period, the Buyer and the Sellers
are unable to resolve such disagreements, the Buyer and the Sellers shall select
an independent auditor of recognized national standing to resolve any remaining
disagreements as to whether the Closing Date Balance Sheet has been prepared
in accordance with the Sellers' historical accounting practices, consistent with
the preparation of the Interim Balance Sheet pursuant to a letter of engagement
mutually acceptable to Buyer, Sellers and the independent auditor. In the event
Sellers and Buyer are unable to agree upon an independent auditor, the choice
of auditor shall be referred to three arbitrators selected by the American
Arbitration Association, who shall promptly retain an independent auditor of
recognized national standing to determine the matter. The determination of
such independent auditor shall be final, binding and conclusive on the parties.
The amount of any further adjustment in the Cash Purchase Price shall be paid
together with interest thereon at a per annum rate equal to Citibank N.A.'s
"base" rate of interest in effect from time to time, which rate shall change as
and when such "base" rate shall change. Such interest shall accrue and be
calculated from the Closing Date through the date of any payment of such
further adjustment in the Cash Purchase Price. Such independent auditor shall
make its determination within thirty (30) calendar days of accepting its
selection. The fees and expenses of such independent auditor (and, if
necessary, the arbitrators) shall be borne one-half by the Buyer and one-half by
the Sellers.
3.2 Allocation
Within fifteen (15) days after the Adjusted Final Purchase Price shall be deemed
to be final pursuant to Section 3.1(c) above, Sellers shall deliver to Buyer a
certificate allocating the Purchase Price and Assumed Liabilities (the
"Allocation Certificate"). The Allocation Certificate shall be prepared in
accordance with Section 1060 of the Internal Revenue Code of 1986, as amended.
Each party shall file Internal Revenue Service Form 8594, and all federal,
state, and other tax returns in accordance with the Allocation Certificate. Any
subsequent allocation necessary as a result of an adjustment to the
consideration to be paid hereunder shall be determined by Sellers in a manner
consistent with the Allocation Certificate. The parties agree to consult with
one another with respect to any tax audit, controversy or litigation relating to
the Allocation Certificate by the Internal Revenue Service or another taxing
authority.
3.3 Delivery and Payment
At the Closing, (i) UTA shall deliver to Buyer a duly executed transfer or
transfers in the usual English form in favor of the Buyer or its designee(s) in
respect of the Shares, together with the share certificate(s) representing the
Shares, (ii) UTAS shall deliver to Buyer at the Closing UTAS' plan to comply
with UTAS' obligations under Section 8.1 of the Joint Venture Agreement which
relates to the potential sale, assignment or transfer of UTAS' interest in the
Joint Venture to Buyer, (iii) UTAS shall deliver to Buyer such deeds, bills of
sales, endorsements, certificates, instruments of assignment and such other
instruments of conveyance and transfer reasonably satisfactory in form and
substance to Buyer as shall be necessary to vest in Buyer good and marketable
title to the real property and good and transferable title to the personal
property, in each case, free and clear of any mortgage, imperfection of title,
lien, pledge, option, security interest, claim, charge or other encumbrance
except Permitted Encumbrances (as defined in Section 5.7), and (iv) IPCO shall
deliver such instruments of assignment and license as are necessary to assign
the Patent Rights and license the Know-how, all as described in Section 2.5 and
(v) Buyer shall deliver to Sellers such instruments of assumption reasonably
satisfactory in form and substance to Sellers as shall be necessary for Buyer to
assume all of the Assumed Liabilities and such instruments as are necessary to
license back certain rights in the Patent Rights as described in Section 2.5.
3.4 ▇▇▇▇▇▇▇▇ Intercompany Financing Discharge
At Closing, immediately following the transfer of the Shares, Buyer will
discharge the ▇▇▇▇▇▇▇▇ Intercompany Financing.
SECTION 4. LIABILITIES
4.1 Assumed Liabilities
Subject to the terms and conditions of this Agreement, at the Closing the Buyer
shall execute an Assumption Agreement whereby the Buyer shall, as of the
Closing Date, assume and agree thereafter to pay, perform and discharge, and to
indemnify UTAS, UTAS de Mexico and UTA its directors, officers and employees
against and hold each of them harmless from the following liabilities and
obligations (the "Assumed Liabilities"):
(a) all of UTAS's and UTAS de Mexico's liabilities and obligations, whether
absolute, accrued, contingent or otherwise remaining unpaid or unperformed on
the Closing Date under contracts, leases, commitments and other agreements which
relate solely or predominantly to the Steering Wheels N.A. Business or are
included in the Transferred Assets;
(b) UTAS's and UTAS de Mexico's obligations to complete sales of and purchase
orders for products of the Steering Wheels N.A. Business to the extent unfilled
on the Closing Date and included in the Transferred Assets;
(c) any other liabilities or obligations of UTAS and UTAS de Mexico whether
absolute, accrued, contingent or otherwise, known or unknown with respect to the
Steering Wheels N.A. Business, the Transferred Assets or the products of the
Steering Wheels N.A. Business arising subsequent to the Closing Date, except for
the Retained Liabilities set forth in Section 4.2; and
(d) all liabilities and obligations arising as a result of, or in connection
with, the employment by Buyer of the Transferred Employees (as defined in
Section 9, except to the extent otherwise specifically provided in Section 9) in
connection with the Steering Wheels N.A. Business;
(e) [intentionally omitted]; and
(f) In the event (i) an Assigned Contract does not expressly permit the
assignment
by UTAS or UTAS de Mexico of its rights and obligations thereunder, (ii) UTAS or
UTAS de Mexico has not obtained the necessary written consents to an assignment
from all parties to an Assigned Contract prior to the Closing Date or (iii)
direct assumption of an Assigned Contract is not practical, the Buyer shall
fulfill such contract and assume the obligations and liabilities arising from
the performance of such contract for and on behalf of UTAS or UTAS de Mexico but
for the account of the Buyer.
4.2 Retained Liabilities
Notwithstanding the provisions of Section 4.1, the following liabilities of UTAS
and UTAS de Mexico relating to the Steering Wheels N.A. Business (herein
referred to as the "Retained Liabilities") shall be retained by UTAS and UTAS de
Mexico and shall not be assumed by the Buyer on the Closing Date:
(a) certain liabilities specifically related to the implementation of Phase II
of the consolidation plan for North America that include (1) liabilities
associated with the Niles, Michigan real property to be retained by UTAS; (2)
environmental liabilities associated with this property; (3) severance costs for
any affected Niles employees who will not be retained by Buyer; (4)
[intentionally omitted]; (5) personal property at the Niles, Michigan facility
that will be retained by UTAS as described in Exhibit 2.1(b), (Item II);
(b) all intercompany accounts with its affiliates and/or intracompany accounts;
(c) all federal and state income tax and franchise tax obligations with respect
to the Business relating to all periods prior to the Closing Date;
(d) all obligations that pertain to insurance contracts, benefit plans or
similar arrangements for the purpose of providing retirement benefits, welfare
benefits, deferred compensation or other employee benefits for employees of the
Steering Wheels N.A. Business for which the corresponding funds are to be
retained by Sellers pursuant to Section 2.2(k); and
(e) the defense of and liability for those matters identified in Exhibit 5.14.
SECTION 5. REPRESENTATIONS AND WARRANTIES OF THE SELLERS
The Sellers represent and warrant to the Buyer that the following
representations and warranties are true and correct on the date of this
Agreement (except for those representations and warranties which expressly speak
to the Closing Date):
5.1 Corporate Organization
The Sellers and ▇▇▇▇▇▇▇▇ are duly incorporated, validly existing and in good
standing under the laws of their state or country of incorporation, with all
requisite corporate power and authority to own, operate and lease their
properties and to carry on the Business as it is now being conducted, and are
qualified or licensed to do business in each jurisdiction in which the Business
property is owned, leased or operated by them or the nature of the Business
makes such qualification or licensing necessary and the absence of which
qualification would be reasonably likely to have a material adverse effect on
the financial condition of the Business taken as a whole.
5.2 (a) ▇▇▇▇▇▇▇▇ Share Ownership
The Shares constitute the entire allotted and issued share capital of ▇▇▇▇▇▇▇▇
and all the Shares are fully paid up. UTA is and at the Closing will be the
registered holder and beneficial owner of all of the Shares, free and clear of
all Encumbrances. ▇▇▇▇▇▇▇▇ is the registered holder and beneficial owner of the
entire allotted and issued share capital of Elmgrove, Ltd. (the "Subsidiary"),
free and clear of all Encumbrances and all such shares are fully paid up. There
are no agreements or arrangements in force which grant to any person the right
(whether exercisable now or in future and whether or not conditional) to call
for the allotment or issue of any share capital of ▇▇▇▇▇▇▇▇ or the Subsidiary
(whether by way of option or conversion right or otherwise).
(b) ▇▇▇▇▇▇▇▇ Intercompany Financing
(b) ▇▇▇▇▇▇▇▇ Intercompany FinancingClifford borrows from and has debt
obligations (the "▇▇▇▇▇▇▇▇ Intercompany Financing") to an affiliated group of
companies (the "▇▇▇▇▇▇▇▇ Payees"). The amount of the ▇▇▇▇▇▇▇▇ Intercompany
Financing as of the Closing Date shall be Seventeen Million Four Hundred
Eighteen Thousand Three Hundred Eighteen and 37/100 ($17,418,318.37).
5.3 UTAS' Interest in Hankook-▇▇▇▇▇▇▇
UTAS owns a 31% equity interest in the Hankook-▇▇▇▇▇▇▇ ▇▇▇▇▇▇ Hoesa joint
venture. Transfer of UTAS' equity interest is subject to a right of first
refusal by certain Korean investors.
5.4 Authority
Sellers have full power, right and authority to execute this Agreement and to
perform all their obligations hereunder. The execution, delivery and performance
of this Agreement by Sellers and the consummation by Sellers of the transactions
contemplated hereby have been duly authorized by all necessary corporate action
of Sellers. This Agreement has been duly executed and delivered by each of
Sellers and, assuming due authorization, execution and delivery of this
Agreement by Buyer and that Buyer has full corporate power and legal right to
enter into this Agreement and to perform its obligations hereunder, constitutes
a legal, valid, binding and enforceable obligation of each of Sellers, subject
to applicable bankruptcy, insolvency and other similar laws affecting creditors'
rights generally and subject, as to enforceability, to general principles of
equity (regardless of whether enforcement is sought in a proceeding at law or in
equity). Except as set forth in Exhibit 5.4 hereto, the execution, delivery and
performance by Sellers of this Agreement and the consummation of the
transactions contemplated by this Agreement will not (i) violate any material
agreement, obligation or commitment to which Sellers in respect of the Steering
Wheels N.A. Business or ▇▇▇▇▇▇▇▇ is a party or bound, (ii) violate any provision
of any material applicable law, published rule or regulation to which any of
Sellers or ▇▇▇▇▇▇▇▇ is subject (provided that no representation is made herein
with respect to (x) any provision of law, rule or regulation relating to any
United States federal or state law or law of any other United States or foreign
jurisdiction relating to antitrust or the regulation of competition or business
combinations (collectively, "Antitrust Laws") or (y) the Omnibus Trade and
Competitiveness Act of 1988 (the "Exon-▇▇▇▇▇▇ Act"), (iii) violate any order,
judgment or decree applicable to any of Sellers or ▇▇▇▇▇▇▇▇ or (iv) conflict
with, or result in a breach or default under, any term or condition of the
charter or by-laws of Sellers or ▇▇▇▇▇▇▇▇.
5.5 ▇▇▇▇▇▇▇▇ Subsidiaries
Except as set forth on Exhibit 5.5, ▇▇▇▇▇▇▇▇ does not have any subsidiaries, or
own or control any shares or securities of, or have any other proprietary
interest in, or control of the management or policies of any corporate entity.
5.6 Material Adverse Changes
Except as set forth on Exhibit 5.6, since July fiscal month end (i) there have
been no changes in the business, operations, assets or liabilities of the
Business which, individually or in the aggregate, have had a material adverse
effect on the financial condition of the Business taken as a whole; (ii) the
Business has not suffered any casualty which resulted in damage, destruction or
loss (not covered by insurance) which has had or would be reasonably likely to
have a material adverse effect on the financial condition of the Business taken
as a whole; and (iii) the Business has not suffered any strike or other work
stoppage which has had a material adverse effect on the financial condition of
the Business taken as a whole.a material adverse effect on the financial
condition of the Business taken as a whole.
5.7 Title to Steering Wheels N.A. Business Assets
UTAS and UTAS de Mexico has and shall convey good and marketable title to all of
the owned Transferred Assets constituting real property and good and
transferable title to the owned Transferred Assets constituting personal
property to Buyer at the Closing free and clear of any Encumbrances, except for
Permitted Encumbrances. For the purposes of this Agreement, "Permitted
Encumbrances" shall mean:
(a) any Encumbrances reflected on Exhibit 5.7;
(b) any Encumbrances that do not materially detract from the current value of
the Transferred Assets or materially interfere with the current use of the same;
(c) any Encumbrances for taxes and assessments not yet past due or that are
being contested in good faith (upon completion of said contest, the obligation
shall remain with Sellers);
(d) mechanic's, materialmen's, workmen's, repairmen's, warehousemen's,
carriers', and other similar Encumbrances (except to the extent they reflect
obligations of Sellers hereunder); and
(e) any Encumbrances that are matters of record, such as easements, quasi-
easements, rights of way, land use ordinances and zoning plans.
5.8 Title to ▇▇▇▇▇▇▇▇ Assets and Properties
▇▇▇▇▇▇▇▇ is the exclusive owner or lessee of all of the assets and real and
personal property used by it in its business, free and clear of any
Encumbrances, except for:
(a) any Encumbrances reflected in the Exhibits or the ▇▇▇▇▇▇▇▇ financial
statements;
(b) any Encumbrances that do not materially detract from the current value of
the property subject thereto or materially interfere with the current use by
▇▇▇▇▇▇▇▇ of the property subject thereto or affected thereby or otherwise
materially impair the financial condition of ▇▇▇▇▇▇▇▇;
(c) any Encumbrances for taxes and assessments not yet past due or that are
being contested in good faith;
(d) mechanic's, materialmen's, workmen's, repairmen's, warehousemen's, carriers'
and other similar liens and encumbrances; and
(e) any Encumbrances that are matters of record, such as easements, quasi-
easements, rights of way, land use ordinances and zoning plans.
5.9 Real Property and Leases
All real property owned by UTAS (to the extent included as part of the
Transferred Assets) or ▇▇▇▇▇▇▇▇, and all leases under which UTAS, with respect
to the Steering Wheels N.A. Business (to the extent included as part of the
Transferred Assets) or ▇▇▇▇▇▇▇▇ are the lessees of real property and that
require a lease payment in excess of $25,000 annually (the "Leases") are listed
on Exhibit 5.9. Except as set forth on Exhibit 5.9, all Leases are in full force
and effect, neither UTAS nor ▇▇▇▇▇▇▇▇ is in default in any material respect
under any of the Leases and no condemnation, expropriation, eminent domain or
similar proceeding is pending with respect to any of such real properties.
5.10 Compliance with Law
Except as set forth on Exhibit 5.10 or except as previously disclosed to Buyer:
(a) the Steering Wheels N.A. Business and the business of ▇▇▇▇▇▇▇▇ are in
substantial compliance in all material respects with all applicable federal,
state, local and foreign laws, including, without limitation, environmental,
zoning, employee benefits and pension, occupational safety and health laws,
ordinances and published rules and regulations of any governmental entity having
jurisdiction over the Steering Wheels N.A. Business or ▇▇▇▇▇▇▇▇, as the case may
be, and any judgments, injunctions, orders or decrees applicable to the Steering
Wheels N.A. Business or ▇▇▇▇▇▇▇▇, as the case may be, except in all cases for
any possible non-compliance that does not or is not reasonably likely to have a
material adverse effect on the financial condition of the Business taken as a
whole. Except as set forth on Exhibit 5.10, neither Sellers, nor to the
knowledge of ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, has received during 1996 any written notice from
any governmental authority or agency claiming any material non- compliance by
the Steering Wheels N.A. Business or ▇▇▇▇▇▇▇▇, as the case may be, with any
applicable federal, state, local, or foreign law;
(b) all governmental approvals, permits and licenses required for the conduct of
the Business as now conducted have been obtained and are in full force and
effect and are being complied within all material respects, except for those the
absence of which do not or are not reasonably likely to have a material adverse
effect on the financial condition of the Business taken as a whole;
(c) Sellers have filed all applications, notices and other documents necessary
to effect the timely renewal or issuance of all governmental approvals, permits
and licenses required for the continued conduct of the Business as now
conducted, except for those the absence of which do not or are not reasonably
likely to have a material adverse effect on the financial condition of the
Business taken as a whole; and
(d) there are no proceedings pending or, to the best of Sellers' knowledge,
threatened in respect of the Steering Wheels N.A. Business or pending or, to the
best of Sellers' knowledge, threatened against ▇▇▇▇▇▇▇▇ which are likely to
result in the revocation, cancellation or suspension of any such governmental
approvals, permits and licenses, except for such proceedings which do not or
are not reasonably likely to have a material adverse effect on the financial
condition of the Business taken as a whole.
5.11 Financial Statements
The 1996 fiscal year for the Steering Wheels N.A. Business is from December 26,
1995 through December 25, 1996. The 1996 fiscal year for ▇▇▇▇▇▇▇▇ is from
December 1, 1995 through November 30, 1996. The unaudited Interim Balance Sheet
of the Business as of July 1996 fiscal month end, and the unaudited Combined
Statements of Plant Operations (Income Statement) of the Business for the seven
month period of operation from December 26, 1995 through the July 1996 fiscal
month end in the case of the Steering Wheels N.A. Business and for the seven
month period of operation from December 1, 1995 through June 30, 1996 in the
case of ▇▇▇▇▇▇▇▇ which are attached as Exhibit 5.11, are in accordance with the
books and records of the Sellers, and have been prepared by the Sellers'
personnel in conformity with the Sellers' historical accounting practices except
as noted.
5.12 Material Contracts
Exhibit 5.12 sets forth all Material Contracts (as defined below) and except as
set forth on Exhibit 5.12, neither the Sellers in respect of the Steering Wheels
N.A. Business nor ▇▇▇▇▇▇▇▇ is in default under, or has received written notice
of default with respect to any Material Contracts of the Business in effect on
the date hereof which relate solely to, or confer any material benefit on, the
Business, or which materially affect any of the Transferred Assets or Assumed
Liabilities.
A contract is deemed to be a "Material Contract" if it is a commitment,
agreement or contract of any kind to be performed after the Closing Date
pursuant to which Sellers in respect of the Steering Wheels N.A. Business or
▇▇▇▇▇▇▇▇ is obligated or authorized to expend or has any right to receive more
than $250,000 in any twelve (12) month period and which is not subject to
cancellation by Sellers or ▇▇▇▇▇▇▇▇, as the case may be, upon less than six (6)
months notice or without penalty or increased cost.
5.13 Taxes
Except as set forth on Exhibit 5.13, the Sellers with respect to the Steering
Wheels N.A. Business and ▇▇▇▇▇▇▇▇ have filed all material federal, state, local,
and foreign tax returns required by law to be filed by them due with respect to
the 1995 and prior fiscal periods. As of the date hereof, except as set forth on
Exhibit 5.13, there is no claim or assessment in a material amount pending
against the Steering Wheels N.A. Business or ▇▇▇▇▇▇▇▇ based on a failure to pay
taxes, social security or other similar charges, duties, interest or penalties.
The Sellers have received no written notice from any taxing authority of any
material obligation that may constitute or result in a lien on the Transferred
Assets or the Shares.
5.14 Disputes
Except as set forth on Exhibit 5.14, there is no suit, action, arbitration or
similar proceeding pending or, to Sellers' knowledge, threatened against Sellers
in respect of the Steering Wheels N.A. Business or pending or, to Sellers'
knowledge, threatened against ▇▇▇▇▇▇▇▇ which, if adversely resolved, would be
reasonably likely to have a material adverse effect on the financial condition
of the Business taken as a whole. Except as set forth on Exhibit 5.14, neither
Sellers in respect of the Steering Wheels N.A. Business nor ▇▇▇▇▇▇▇▇ is a party
to or is bound by any judgment, decree, injunction, ruling, award or order of
any governmental authority, arbitrator or any other person which would be
reasonably likely to have a material adverse effect on the financial condition
of the Business taken as a whole. Except as set forth on Exhibit 5.14, since
December 31, 1995, neither Sellers nor ▇▇▇▇▇▇▇▇ has compromised, settled or lost
any arbitration or judicial proceeding the result of which would be reasonably
likely to have a material adverse effect on the financial condition of the
Business taken as a whole.
5.15 Brokers and Finders
With the exception of ▇▇▇▇▇ ▇▇▇▇▇▇ Inc., neither Sellers nor their affiliates
have employed any broker, finder, consultant or intermediary in connection with
the transactions contemplated by this Agreement that would be entitled to a
broker's, finder's or similar fee or commission in connection therewith. Sellers
shall be responsible to make payments, if any, to which ▇▇▇▇▇ ▇▇▇▇▇▇ Inc. may be
entitled.
5.16 Collective Bargaining Agreements, Employment Agreements and Benefit
Plans
Except as set forth on Exhibit 5.16, neither UTAS, nor UTAS de Mexico in respect
of the Steering Wheels N.A. Business nor ▇▇▇▇▇▇▇▇ has in effect any collective
bargaining agreement or employment agreement (other than oral agreements of
at-will employment). Except as set forth on Exhibit 5.16, there are no disputes
currently subject to any grievance procedure, arbitration or litigation under
such agreements nor is there any default under any such agreements, by any of
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, or to the knowledge of Sellers, any other party thereto,
which individually or in the aggregate reasonably would be likely to have a
material adverse effect on the financial condition of the Business taken as a
whole.
5.17 ERISA; Employee Benefits
(a) Except as disclosed on Exhibit 5.17, Sellers do not maintain or contribute
to or have any liability with respect to any material (i) incentive, bonus,
commission, or deferred compensation or severance or termination pay plan,
agreement or arrangement for the benefit of employees employed in the Steering
Wheels N.A. Business, (ii) pension, profit-sharing, stock purchase, stock
option, group life insurance, hospitalization insurance, disability, retirement
or any other employee benefit plan, agreement or arrangement, including but not
limited to any "employee benefit plan" (as defined in section 3 (3) of the
Employee Retirement Income Security Act of 1974, as amended ("ERISA")), for the
benefit of employees employed in the Steering Wheels N.A. Business or (iii)
fringe benefit plan, agreement or arrangement for the benefit of employees
employed in the Steering Wheels N.A. Business (the items referred to in (i),
(ii) and (iii) above are hereinafter referred to collectively as, the "Plans"
and individual as a "Plan"). Each of the Plans set forth on Exhibit 5.17 that is
an "employee pension benefit plan" (as such term is defined in section 3 (2) of
ERISA) or an "employee welfare benefit plan" (as such term is defined in section
3 (1) of ERISA), has been operated in material compliance with its written terms
and, to the best knowledge of Sellers, the applicable provisions of ERISA and
the applicable provisions of the Internal Revenue Code of 1986 (the "Code"), and
the regulations promulgated thereunder. To the extent applicable, Sellers have
heretofore delivered or made available to Buyer complete copies of (i) each
Plan, including all amendments thereto, and its related trust agreement, if any,
and summary plan description, if any, and (ii) each collective bargaining
agreement relating to each Plan.
(b) Except as set forth on Exhibit 5.17, or in the Plan provisions covering
employees covered by a collective bargaining agreement, there are no agreed upon
future increases of benefit levels for employees employed in the Steering Wheels
N.A. Business, and no increases in benefits have been committed to by Sellers
for the benefit of employees employed in the Steering Wheels N.A. Business,
except for those increases which would not have a material adverse effect on the
financial condition of the Steering Wheels N.A. Business. With respect to each
Plan, full payment has been made of all amounts that Sellers are required to
have paid as contributions to such Plan under its terms or under the terms of
any applicable collective bargaining agreement.
(c) No liability under Title IV of ERISA has been or is expected to be incurred
by Sellers with respect to any ongoing, frozen or terminated plan currently or
formerly maintained by either of them, or the plan of any entity which is
considered a predecessor of Sellers or a single employer with Sellers under
section 4001 of ERISA, which would result in any Encumbrance on the Transferred
Assets.
(d) None of the Plans is a "multi employer plan," as such term is defined in
section 3 (37) of ERISA.
(e) There are not pending or, to the knowledge of Sellers, threatened claims
against any of the Plans or related trusts other than routine claims by
participants and beneficiaries for benefits due and owing under such plans.
5.18 Intellectual Property
Except as set forth on Exhibit 5.18, IPCO is the owner of the Patent Rights set
forth on Exhibit 2.5 and Sellers are the owners of the Know-how or have the
right to license the same as contemplated by the Know-how License Agreement, and
neither IPCO nor Sellers nor ▇▇▇▇▇▇▇▇ has received any written notice from any
other person challenging the right of Sellers or ▇▇▇▇▇▇▇▇ to use any such
Intellectual Property. Except as set forth on Exhibit 5.18 hereto, to Sellers',
Clifford's and IPCO's knowledge, none of the Intellectual Property is being
infringed upon or appropriated by others, and none is subject to any outstanding
order, decree, judgment, stipulation or injunction affecting the scope of the
free and unrestricted use by Sellers or ▇▇▇▇▇▇▇▇ (to the extent of such
Intellectual Property) or used contrary to the provisions of any licensing or
other agreement. Except as set forth on Exhibit 5.18 hereto, to Sellers',
Clifford's and IPCO's knowledge, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ and IPCO are not infringing
upon any third party's rights through Sellers' and Clifford's utilization of the
Patent Rights in the operations of the Business. Except for the Patent Rights,
Sellers have no other United States patents, foreign patents, inventions for
which there are pending United States or foreign patent applications or
unpatented inventions that are utilized in the operations of the Business as of
the Closing Date or that are anticipated to be put into actual production within
one year of the Closing Date. Notwithstanding the foregoing, the Buyers shall
not have any right, title or interest in or to any United States patents,
foreign patents, inventions for which there are pending United States or foreign
patent applications, unpatented inventions, trade secrets, technical information
or know-how with respect to the development, manufacture or distribution of the
items listed in Section 16.18(d)(i) and (ii) or any related products.
5.19 Consents
Except as set forth on Exhibit 5.19 and in this Agreement, no material consent,
license, approval, waiver, expiration of waiting period or authorization of, or
registration or declaration with, any governmental authority, agency, bureau or
commission, or any third party (a "Consent"), is required to be obtained or made
by Sellers in connection with the execution, delivery, performance and
enforceability of this Agreement or the sale or transfer of the Transferred
Assets pursuant hereto or the transfer of ownership of the Business as
contemplated hereby other than (a) those the failure of which to be made or
obtained, individually or in the aggregate, would not be reasonably likely to
have a material adverse effect on the Business taken as a whole, or on the
ability of Sellers to consummate the transactions contemplated by this Agreement
and (b) as may be required by the ▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Antitrust Improvements Act
of ▇▇▇▇ (▇▇▇ "▇▇▇ ▇▇▇") or the Exon-▇▇▇▇▇▇ Act.
5.20 Accounts Receivable5.20 Accounts Receivable.
All accounts receivable of the Business shown on the ▇▇▇▇▇▇▇▇ Interim Financial
Statements and the Steering Wheels N.A. Business Interim Financial Statements
and all accounts receivable arising thereafter and prior to the Closing shown on
the books of the Business, arose and will arise from bona fide transactions in
the ordinary course of business.
5.21 Employment Records
The Sellers have previously provided or will provide by Closing to the Buyer a
true and accurate list of the names of management staff of the Business together
with a summary of all salary, bonus, incentive compensation or other additional
cash compensation, if any, paid to such persons for the 1995 calendar year.
5.22 Notification by Sellers of Transfer of Indiana Property
Exhibit 5.22 hereto is a copy of the Indiana Responsible Property Transfer Law
report that UTAS is required to submit to the State of Indiana in conjunction
with the transfer of real property as part of the transaction contemplated
hereby.
5.23 Condition of Transferred Assets
All Transferred Assets, including, without limitation, all buildings, fixtures
and other improvements and all equipment and machinery (collectively the
"Fixtures") used in the manufacturing process are, and will be at the time of
Closing, in good operating condition and repair except for such Fixtures that
are not individually or in the aggregate material to the operation of the
Steering Wheels N.A. Business.
5.24 No Other Representations or Warranties
EXCEPT FOR THE REPRESENTATIONS AND WARRANTIES CONTAINED IN THIS AGREEMENT,
NEITHER SELLERS NOR IPCO NOR ANY OTHER PERSON ACTING ON THEIR BEHALF (INCLUDING
ANY OFFICERS, DIRECTORS, EMPLOYEES, AGENTS OR REPRESENTATIVES OF ▇▇▇▇▇▇▇▇ OR THE
STEERING WHEELS N.A. BUSINESS) MAKES ANY OTHER REPRESENTATION OR WARRANTY,
EXPRESS OR IMPLIED, AND SELLERS AND IPCO HEREBY DISCLAIM ANY SUCH OTHER
REPRESENTATION OR WARRANTY, WHETHER BY SELLERS AND IPCO OR ANY OF THEIR
RESPECTIVE OFFICERS, DIRECTORS, EMPLOYEES, AGENTS OR REPRESENTATIVES OR ANY
OTHER PERSON (INCLUDING ANY OFFICERS, DIRECTORS, EMPLOYEES, AGENTS OR
REPRESENTATIVES OF IPCO, ▇▇▇▇▇▇▇▇ OR THE STEERING WHEELS N.A. BUSINESS), WITH
RESPECT TO THE EXECUTION, DELIVERY OR PERFORMANCE BY SELLERS OR IPCO OF THIS
AGREEMENT OR WITH RESPECT TO THE TRANSACTIONS CONTEMPLATED HEREBY,
NOTWITHSTANDING THE DELIVERY OR DISCLOSURE TO BUYER OR ANY OF ITS OFFICERS,
DIRECTORS, EMPLOYEES, AGENTS OR REPRESENTATIVES OR ANY OTHER PERSON OF ANY
DOCUMENTATION OR OTHER INFORMATION BY SELLERS, IPCO OR ANY OF THEIR RESPECTIVE
OFFICERS, DIRECTORS, EMPLOYEES, AGENTS OR REPRESENTATIVES OR ANY OTHER PERSON
(INCLUDING ANY OFFICERS, DIRECTORS, EMPLOYEES, AGENTS OR REPRESENTATIVES OF
IPCO, ▇▇▇▇▇▇▇▇ OR THE STEERING WHEELS N.A. BUSINESS, WITH RESPECT TO ANY ONE OR
MORE OF THE FOREGOING).
SECTION 6. REPRESENTATIONS AND WARRANTIES OF THE BUYER
The Buyer represents and warrants to the Sellers that the following
representations and warranties are true and correct on the date of this
Agreement:
6.1 Organization, Good Standing and Corporate Power
The Buyer is a corporation duly incorporated, validly existing and in good
standing under the laws of the State of Delaware and has all requisite corporate
power and authority to own its properties and to carry on its business as it is
presently being conducted. The Buyer has all requisite corporate power and
authority to purchase and own the Transferred Assets and Shares, assume and
perform the Assumed Liabilities, conduct the Business as it is presently being
conducted and perform the other covenants and agreements of the Buyer under this
Agreement and the Assumption Agreement.
The execution, delivery and performance of this Agreement and the Assumption
Agreement and the consummation of the transactions contemplated hereby and
thereby have been duly authorized by all necessary corporate action of the
Buyer.
6.2 Authority
Buyer has full power, right and authority to execute this Agreement and to
perform its obligations hereunder. The execution, delivery and performance by
Buyer of this Agreement and the consummation of the transactions contemplated by
this Agreement will not (i) violate any provision of any material applicable
law, published rule or regulation to which Buyer is subject (provided that no
representation is made herein with respect to any Antitrust Laws or the
Exon-▇▇▇▇▇▇ Act), (ii) violate any order, judgment or decree applicable to
Buyer, (iii) violate any material agreement, obligation or commitment to which
Buyer is a party or (iv) conflict with or result in a breach or default under
any term or condition of Buyer's charter or by-laws. This Agreement has been
duly and validly executed and delivered by Buyer and constitutes the valid and
binding obligation of Buyer, enforceable against Buyer in accordance with its
terms, subject to applicable bankruptcy, insolvency and other similar laws
affecting creditors' rights generally and subject, as to enforceability, to
general principles of equity (regardless of whether enforcement is sought in a
proceeding at law or in equity).
6.3 Consents of Buyer
Except as set forth in this Agreement, no Consent is required to be made or
obtained by Buyer in connection with the execution, delivery, performance and
enforceability of this Agreement or the transactions contemplated hereby other
than (a) those the failure of which to be made or obtained, individually or in
the aggregate, would not be reasonably likely to have a material adverse effect
on Buyer or the ability of Buyer to consummate the transactions contemplated by
this Agreement and (b) as may be required by the HSR Act or the Exon-▇▇▇▇▇▇ Act.
6.4 Acquisition of Shares
The Shares are being and the Hankook Interest will be acquired by Buyer for its
own account and not with a view to or in connection with any disposition thereof
in violation of (i) the Securities Act of 1933, as amended or the rules and
regulations thereunder, (ii) any applicable state securities or "blue sky" laws,
or (iii) any applicable securities laws of the United Kingdom, the Republic of
Korea or any political subdivision thereof or therein.
6.5 Brokers and Finders
Buyer has not employed or become obligated to pay any fee or commission to any
broker, finder, consultant, investment banker or other intermediary in
connection with transactions contemplated by this Agreement. Buyer represents
that Sellers shall have no obligations whatsoever to any broker, finder,
consultant, investment banker orintermediary, resulting from this Agreement or
the transactions contemplated hereby.
6.6 Financing
The Buyer has all funds necessary for the consummation of the transactions
contemplated by this Agreement and will provide evidence thereof satisfactory to
the Sellers, in their sole discretion, upon request.
6.7 Condition of Transferred Assets
THE BUYER UNDERSTANDS AND AGREES THAT THE TRANSFERRED ASSETS, PROPERTIES AND
RIGHTS OF SELLERS BEING PURCHASED HEREUNDER ARE SOLD, ASSIGNED, LEASED,
TRANSFERRED AND CONVEYED TO BUYER IN AN "AS IS" CONDITION ON A "WHERE IS" BASIS
WITHOUT ANY WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR
ANY OTHER WARRANTY, EXPRESS OR IMPLIED, EXCEPT AS OTHERWISE EXPRESSLY STATED
HEREIN.
6.8 Non-reliance
IN CONNECTION WITH ITS DECISION TO ACQUIRE THE TRANSFERRED ASSETS, THE SHARES
AND THE HANKOOK INTEREST, THE BUYER ACKNOWLEDGES THAT IT IS NOT RELYING UPON ANY
FINANCIAL PROJECTIONS, BUDGETS OR OTHER FORWARD-LOOKING FINANCIAL DATA WITH
RESPECT TO THE TRANSFERRED ASSETS, THE SHARES, THE HANKOOK INTEREST OR THE
BUSINESS PREPARED BY OR FURNISHED TO IT BY OR ON BEHALF OF THE SELLERS AND THAT
THE SELLERS ARE MAKING NO REPRESENTATION OR WARRANTY WITH RESPECT THERETO.
SECTION 7. INFORMATION AND RECORDS CONCERNING THE SELLERS
7.1 The Buyer's Access to Information and Records
The Buyer has made or will cause to be made prior to the Closing Date such
investigation of the Business and the Transferred Assets as the Buyer deems
necessary or advisable to familiarize itself with such matters. Any such
investigation shall be conducted by the Buyer so as not to interfere
unreasonably with the Business's normal operations and shall be undertaken in
accordance with such procedures as may be established by agreement between the
Sellers and the Buyer. In no event shall the Buyer communicate with any employee
of the Business without the prior written consent of the Sellers.
(a) Subject to the foregoing, and to the requirement of confidentiality
discussed below in this Section 7.1, the Sellers agree to permit the Buyer and
its authorized representatives, including legal counsel and independent
accountants, upon reasonable notice, to have reasonable access at reasonable
business hours to designated management, employees of the Business, the plant,
properties, inventories and books and records of the Sellers relating to the
Business including contracts, leases, real estate, personal property, tax
returns, audits and books of account. The Sellers will furnish to the Buyer such
financial and operating data and other information on the Business as the Buyer
shall from time to time reasonably request. From the date hereof to the Closing
Date, Sellers shall use reasonable efforts to endeavor to keep Buyer informed
from time to time concerning any material changes that may occur affecting the
Business.
(b) Any facts discovered by the Buyer in the course of any such investigation
which contravene or appear to contravene any representations or warranties made
by the Sellers in this Agreement shall be brought promptly to the attention of
the Sellers by the Buyer. The Buyer agrees to allow the Sellers the opportunity
to explain or take remedial action concerning such facts prior to the Closing
Date. The Buyer agrees that to the extent prior to the Closing Date it has
knowledge of facts which contravene or appear to contravene any representation
or warranty made by the Sellers in this Agreement, it must discuss such facts
with the Sellers and resolve the apparent or actual contravention of such
representation or warranty prior to the Closing Date. If the Buyer fails to do
so, it is estopped from and may not assert any claim concerning such
representation or warranty subsequent to the Closing Date.
(c) Any information provided or obtained pursuant to this Agreement shall be
held by Buyer and its representatives in the strictest confidence and in
accordance with and shall be subject to the terms of the Nondisclosure Agreement
dated May 20, 1996 between the parties hereto and, in the event the transactions
contemplated by this Agreement are not consummated, shall be returned or
destroyed in accordance with the Nondisclosure Agreement and this Agreement.
7.2 Parties' Access to Records After Closing
Except as provided in Section 7.3 hereof, the parties hereto each agree to
preserve until the seventh (7th) anniversary of the Closing Date or until the
expiration of the statute of limitations with respect to the tax year which
includes the Closing Date, all records in their possession relating to any of
the Transferred Assets, the Assumed Liabilities or the Business. The Buyer has
been informed that the Sellers and their affiliates will include the operation
of the Business in their federal and state income tax returns for all periods
prior to the Closing Date and for such purposes the Buyer will permit authorized
employees of the Sellers or their representatives, affiliates and successors to
gather and prepare such information as the Sellers may reasonably require for
preparing such tax returns. In the event that either party needs access to
records in the possession of the other party relating to any of the Transferred
Assets, the Assumed Liabilities or the Business for purposes of complying with
Section 3.1(c) hereof, preparing income tax returns or complying with any audit
request, subpoena or other investigative demand by any governmental authority or
for any civil litigation, or for any other legitimate purpose not injurious to
the other party, each party will allow representatives of the other party access
to such records during regular business hours at such party's place of business
for the sole purpose of obtaining information for use as aforesaid and will
permit such other party to make extracts and copies thereof as may be necessary
or convenient.
7.3 Disposal of Records
Subject to Section 2.1(i), the Buyer may at any time and from time to time
subsequent to the Closing Date and prior to the seventh (7th) anniversary of the
Closing Date, dispose of the records in its possession relating to the Steering
Wheels N.A. Business by giving sixty (60) days prior notice of such disposal to
the Sellers; provided, however, that if such records are pertinent to any
dispute, claim, litigation, governmental investigation or the determination of
any federal, state or local tax liability of the Sellers, the Sellers shall have
the right, by giving written notice to the Buyer, to require the Buyer to (i)
retain such records until such time as the Sellers may specify or (ii) provide
such records to the Sellers.
SECTION 8. OBLIGATIONS AND COVENANTS
8.1 Sellers' Conduct of the Business
Except for such actions as are set forth on Exhibit 8.1 (a) or as may be taken
with the prior written consent of the Buyer, the Sellers will conduct the
Business from the date of this Agreement until the Closing Date in accordance
with the same business practices previously followed by them, and during that
period the Sellers shall:
(a) not conduct the Business other than in the ordinary course and shall not
make any single commitment or series of interdependent commitments for capital
expenditures in connection with the Business exceeding $100,000;
(b) refrain from entering into any material licenses, contracts, purchase orders
or other agreements relating to the Business except in the ordinary course of
business;
(c) meet their contractual obligations related to the Business in the ordinary
course of business;
(d) use their reasonable efforts to maintain the Business intact and to preserve
the good relations of their suppliers, customers, employees, agents and others
with whom they have business relations in connection with the operation of the
Business;
(e) account for, make appropriate filings with respect to, and pay when due all
taxes, assessments and other governmental charges against the Transferred Assets
or in respect of the Business, including all withholding taxes on compensation
paid to employees of the Business from the date hereof through the Closing Date,
except for any such taxes, assessments and charges which the Sellers may be
contesting in good faith;
(f) not take any affirmative action which results in the creation or incurrence
of any debt or monetary obligation relating to the Business, other than in the
ordinary course of business;
(g) not cause ▇▇▇▇▇▇▇▇ to assume, guarantee, endorse or otherwise become
responsible (whether directly, contingently or otherwise) for the obligations
of, or make any loans or advances to, any other individual, firm or corporation;
(h) not waive or release any rights of material value relating to the Business,
or cause ▇▇▇▇▇▇▇▇ to cancel, compromise, release or assign any indebtedness owed
to it or any claims held by it;
(i) not transfer, sell or otherwise convey any of the assets of the Steering
Wheels N.A. Business of any type that are reasonably expected to be within the
definition of Transferred Assets, other than in the ordinary course of business;
(j) not mortgage, pledge, subject to any lien, claim or charge or otherwise
encumber any of the Transferred Assets or in any way create or consent to the
creation of any title condition affecting the Transferred Assets;
(k) other than in the ordinary course of business, with respect to its
directors, officers or employees who are expected to continue to be engaged in
the operation of the Business after the Closing:
(i) not increase the rate or terms of compensation payable or to become payable
to any of them except pursuant to any existing plan or written agreement, or as
may be required to meet any applicable legal requirement;
(ii) not pay or agree to pay any pension, retirement allowance or other employee
benefit not required or permitted by any existing plan, agreement or arrangement
to any of them except as may be required to meet any applicable legal
requirements;
(iii) not commit themselves to any profit sharing, bonus, incentive, group
insurance, retirement or other employee benefit plan, agreement or arrangement,
or increase the rate or terms of any such plan, agreement or arrangement which
now exists, to the extent applicable to any of them except as may be required to
meet any applicable legal requirements or the term of any existing plan or
written agreement;
(l) with respect to its directors, officers or employees who are expected to
continue to be engaged in the operation of the Business after the Closing:
(i) not commit themselves to any additional pension, deferred compensation or
severance pay or stock purchase, stock option or stock appreciation right;
(ii) not enter into any employment or severance agreement with or for the
benefit of them;
(m) not enter into or voluntarily terminate any lease with respect to the
Business or make any change in any leases, other than in the ordinary course of
business;
(n) not make any material alteration in the manner of keeping the books,
accounts or records of the Business, or in the accounting practices therein
reflected, except as required by law or generally accepted accounting principles
in effect in the United States, Mexico or the United Kingdom;
(o) not permit ▇▇▇▇▇▇▇▇ to (i) change or amend its Memorandum or Articles of
Association or (ii) issue any shares or issue or sell any securities convertible
into or exchangeable for or carrying the right to, or options with respect to,
or warrants to purchase or rights to subscribe for, any shares or enter into any
agreement obligating it to do any of the foregoing; and
(p) not agree to take any of the foregoing actions.
8.2 Provision of Transitional Computer Services8.2 Provision of Transitional
Computer Services.
The parties hereto, other than IPCO, agree to enter into good faith negotiations
with the intent to execute upon Closing a Transitional Computer Services
Agreement, under which for a period of up to six (6) months after the Closing
Date (which period may be extended by mutual agreement of the parties thereto),
Sellers will provide Buyer at Sellers' Monterrey operations with data processing
services and reasonable access to computer hardware for use in operation of the
Business and Sellers' Monterrey operations at the monthly cost of such services
as agreed upon by the parties; provided, however, that if at the time of Closing
such parties have not entered into such agreement, then the Sellers shall
continue to provide to Buyer at the cost to Sellers such services at a level at
which such services had been provided immediately prior to Closing.
8.3 Provision for Transitional Employee Benefits
The parties hereto, other than IPCO, agree to enter into good faith negotiations
with the intent to execute upon Closing a Transitional Employee Benefits
Agreement, under which for a period of up to six (6) months after the Closing
Date (which period may be extended by mutual agreement of the parties thereto),
Sellers will provide upon an administrative services only basis the employee
benefits that are provided to employees of the Business; provided, however, that
if at the time of Closing such parties have not entered into such agreement,
then the Sellers shall continue to provide to Buyer at the cost to Sellers such
services at a level at which such services had been provided immediately prior
to Closing.
8.4 Provision of Transitional Administrative Services
The parties hereto, other than IPCO, agree to enter into good faith negotiations
with the intent to execute upon Closing a Transitional Administrative Services
Agreement, under which for a period of up to six (6) months after the Closing
Date (which period may be extended by mutual agreement of the parties thereto),
Sellers will provide Buyer with support services that have historically been
provided to the Business by Sellers at a cost that is agreed to by the parties;
provided, however, that if at the time of Closing such parties have not entered
into such agreement, then the Sellers shall continue to provide to Buyer at the
cost to Sellers such services at a level at which such services had been
provided immediately prior to Closing.
8.5 Lease of Office Space in ▇▇▇▇▇▇ Street Facility
The parties hereto, other than IPCO, agree to enter into good faith negotiations
with the intent to execute upon Closing a Lease Agreement (a form of which is
attached hereto as Exhibit 8.5) with respect to the ▇▇▇▇▇▇ Street Facility,
under which for a period of up to six (6) months after the Closing Date (which
period may be extended by mutual agreement of the parties thereto), Sellers will
lease to Buyer the office space that the Steering Wheels N.A. Business presently
occupies at the ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇.
8.6 Lease of Factory and Office Space in Monterrey, Mexico Facility and License
of Warehouse in Laredo, Texas
(a) The parties hereto, other than IPCO, agree to enter into good faith
negotiations with the intent to execute upon Closing a Lease Agreement (a form
of which is attached hereto as Exhibit 8.6(a)) with respect to the Office Space
in Monterrey, Mexico under which for a period of up to six (6) months after the
Closing Date (which period may be extended by mutual agreement of the parties
thereto), UTAS de Mexico will lease to the Buyer the factory space and the
office space that the Steering Wheels N.A. Business presently occupies at the
UTAS de Mexico facility in Monterrey, Mexico.
(b) The parties hereto, other than IPCO, agree to enter into good faith
negotiations with the intent to execute upon Closing a License Agreement (a form
of which is attached hereto as Exhibit 8.6(b)) with respect to the Laredo, Texas
warehouse under which for a period of up to six (6) months after the Closing
Date (which period may be extended by mutual agreement of the parties thereto),
UTAS will license to the Buyer the right to access and use a portion of the
warehouse that UTAS presently occupies in Laredo, Texas.
8.7 Lease of Niles, Michigan Manufacturing Facility
The parties hereto, other than IPCO, agree to enter into good faith negotiations
with the intent to execute upon Closing a Lease Agreement (a form of which is
attached hereto as Exhibit 8.7) with respect to the Niles, Michigan
Manufacturing Facility under which for a period that will commence on the
Closing Date and will end March 31, 1997, or such later date as is mutually
agreed upon by the parties, UTAS will lease to Buyer the Niles Plant that the
Steering Wheels N.A. Business presently operates.
8.8 Niles Employees
Subject to further negotiations and the execution of an agreement, for a period
that will commence on the Closing Date and will end on the earlier of (i) the
completion of the consolidation of the Steering Wheels N.A. Business operations
at the Niles, Michigan Facility into the Steering Wheels N.A. Business
operations at the ▇▇▇▇▇▇▇, Michigan Facility or (ii) June 30, 1997, UTAS will
provide for continued production of the steering wheel products the necessary
production, maintenance and salaried employees (who have not been transferred to
▇▇▇▇▇▇▇) at the Niles, Michigan Facility and will pass on, at its cost, the cost
of providing such employees directly to Buyer, who shall pay such cost in
accordance with such agreement.
8.9 Filings
Buyer and Sellers shall, as soon as practicable, file Notification and Report
Forms under the HSR Act with the Federal Trade Commission and the Antitrust
Division of the Department of Justice with respect to this Agreement and the
transactions contemplated hereby and shall use their respective best efforts to
respond as promptly as practicable to all inquiries received from the Federal
Trade Commission or the Antitrust Division for additional information or
documentation and Buyer shall take promptly all other actions and do all other
things necessary to avoid or eliminate each and every impediment under any
antitrust law that may be asserted by any governmental antitrust authority to
the consummation of the transactions contemplated by the Agreement. Buyer and
Sellers shall use their respective reasonable best efforts to promptly take all
such action as may be necessary under United States federal, state and other
laws applicable to or necessary for the consummation of the transactions
contemplated hereby, and will file and, if appropriate, use their respective
reasonable best efforts to have declared effective or approved all documents and
notifications with all governmental or regulatory authorities that it deems
necessary or appropriate for the consummation of the transactions contemplated
hereby.
8.10 Payment of ▇▇▇▇▇▇▇▇ Intercompany Financing
At the Closing, the Buyer, as owner of the Shares, shall make a payment to the
▇▇▇▇▇▇▇▇ Payees in an amount, denominated in United States dollars, sufficient
to repay in full the ▇▇▇▇▇▇▇▇ Intercompany Financing. The Sellers shall provide
the Buyers with a notice on the third business day immediately preceding the
Closing Date with the specific name or names of the ▇▇▇▇▇▇▇▇ Payees and the
specific wire instructions with respect to the payment in full of the ▇▇▇▇▇▇▇▇
Intercompany Financing (the "▇▇▇▇▇▇▇▇ Notice").
8.11 Supply Agreements
Sellers and their affiliates may, at Buyer's discretion, continue to provide the
following products to the Steering Wheels N.A. Business subsequent to Closing:
(a) Wire Harnesses for Chrysler ZJ - From United Technologies Automotive de
Mexico plant in Chihuahua, Mexico;
(b) Metal Stampings - From UTAS' Sheridan Plant in Wauseon, Ohio; and
(c) PHN 131 Switches - From United Technologies Automotive's Input Controls
business unit, starting in the 1998 model year.
8.12 Retained Liabilities
The Sellers shall use reasonable efforts to pay and discharge, as they become
due and payable, all Retained Liabilities as defined in Section 4.2 hereof to
the extent that if such liabilities were not paid in a timely fashion, it would
have a material adverse effect on Buyer's ongoing operation of the Business.
SECTION 9. EMPLOYMENT AND EMPLOYEE BENEFIT ARRANGEMENTS
9.1 Offer of Employment
Subject to this Section 9, Buyer shall offer employment, commencing on the
Closing Date, to all persons identified in Exhibit 9.1 (such persons are
referred to herein collectively as the "Transferred Employees" and individually
as a "Transferred Employee") at wages, salary, benefits, hours and conditions of
employment that are substantially equivalent in the aggregate to those in effect
immediately prior to the Closing Date. It is anticipated that Buyer will offer
employment to all employees of ▇▇▇▇▇▇▇ and all employees in the steering wheels
operations at the Monterrey, Mexico Facility, selected employees at Niles as
identified in Exhibit 9.1 and all Steering Wheels N.A. Business employees at the
▇▇▇▇▇▇ Street Facility as identified in Exhibit 9.1.
Seller will reimburse Buyer for 50% of the amount of cash severance pay benefits
required by law pursuant to applicable statutory provisions or as required by
the collective bargaining agreement referenced in Section 9.10 hereof to be paid
by Buyer as a result of the termination within fourteen months after the Closing
by Buyer of Transferred Employees employed at the Monterrey, Mexico facility.
Buyer will notify Seller of any such termination, and Seller will use reasonable
efforts to offer such employees employment with other UTA operations.
Buyer currently provides its employees with the following benefits: medical,
dental, life insurance, accidental death and dismemberment, short term
disability, long term disability, dependent life insurance, deferred saving plan
(401k), business travel insurance and employee stock purchase plan. Buyer also
provides the following programs: vacation, holidays, educational assistance and
long term employee incentive plans. With the exception of benefits provided to
Transferred Employees under collective bargaining agreements accepted by Buyer
hereunder, Buyer shall, on a corporate wide, aggregate basis, use its best
efforts to provide benefits and plans within a reasonable time after the
Closing, but effective as of the Closing, to all other Transferred Employees
that are substantially equivalent to those in effect immediately prior to
Closing. However, notwithstanding any specific provision of Section 9 to the
contrary, this shall not constitute a commitment that every plan currently in
place for the Transferred Employees will be adopted or replaced. It is Buyer'
intention to integrate the Transferred Employees into its own compensation and
benefit structure, with the expectation that, taken in total, the benefits to
the Transferred Employees will be substantially equivalent to those they
currently enjoy. Buyer reserves the right, on a case by case basis, to provide
more or less benefits to any individual employee in order to apply its benefit
and compensation scheme consistently across Buyer's corporate structure.
9.2 Continuation of Employee Benefits
(a) Within a reasonable time after the Closing Date, Buyer shall implement with
respect to the Transferred Employees, Plans and other employee benefits,
programs and arrangements substantially comparable in the aggregate to the Plans
and other employee benefits, programs and arrangements provided to the
Transferred Employees of the Steering Wheels N.A. Business on September 20, 1996
and identified in the disclosure schedules. The Plans and other employee
benefits, programs and arrangements so implemented by Buyer shall be effective
as of the Closing Date and shall be maintained and provided by the Buyer until
one year after the Closing Date, except as otherwise may be provided in a
collective bargaining agreement. Notwithstanding the foregoing, Buyer's
obligation to provide employee benefits under this Section 9 shall not preclude
any changes in benefits or plan provisions necessary to comply with applicable
law or in order to qualify for favorable tax treatment.
(b) Within a reasonable time after the Closing Date, Buyer shall implement
severance obligations, practices, and policies that are comparable to the
written severance plans, programs and arrangements in respect of Transferred
Employees identified in Exhibit 5.17, with service to Sellers prior to the
Closing Date recognized in full for purposes of calculating severance benefits.
The comparable severance obligations, practices, and policies under the written
severance plans, programs and arrangements in respect of Transferred Employees
so implemented by Buyer shall be effective as of the Closing Date and shall be
maintained by Buyer until one year after the Closing Date.
(c) Effective as of the Closing Date and except as provided above, Buyer hereby
assumes and agrees to honor the terms of all collective bargaining agreements
affecting Transferred Employees identified in Exhibit 5.16 except to the extent
any such employee agreements or collective bargaining agreements are
renegotiated.
(d) Buyer shall be responsible for and cause to be paid in the normal course of
business the vacation and holiday pay of all Transferred Employees pursuant to
the terms and conditions of applicable collective bargaining agreements or
policies established by Buyer pursuant to paragraph (a) or this Section 9.2,
except to the extent any such collective bargaining agreements are renegotiated.
(e) Buyer shall be responsible and liable for any claim in respect of
Transferred Employees arising under any state worker's compensation or similar
law which is based on any occurrence after the Closing.
(f) No provision of this Agreement shall create any third-party-beneficiary
rights in any employee or former employee (including any beneficiary or
dependent thereof) of the Steering Wheels N.A. Business in respect to continued
employment or resumed employment except as otherwise provided herein.
9.3 Salaried Employees Retirement Plan
UTAS shall retain responsibility for benefits accrued through the Closing Date
under the United Technologies Corporation Employees Retirement Plan (the
"Sellers' Salaried Retirement Plan") for all Transferred Employees who were
participants in the Sellers' Salaried Retirement Plan as of the Closing. No
assets shall be transferred from the Sellers' Salaried Retirement Plan as a
result of the consummation of the transactions contemplated hereby.
9.4 United Technologies Corporation Employee Savings Plan
Transferred Employees with one-year service (as determined under the defined
contribution of Sellers in which they are entitled to participate) shall be
eligible to participate immediately in Buyer's tax-qualified defined
contribution employee pension benefit plan ("Buyer's Savings Plan"). For
purposes of eligibility and vesting only, Buyer's Savings Plan shall grant
credit for all service of Transferred Employee credited under the United
Technologies Corporation Employee Savings Plan (the "Sellers' Savings Plan"). If
Transferred Employee receive lump sum cash outs from the Sellers' Savings Plan,
to the extent such distributions consist of cash or cash equivalents and to the
extent it is permissible under Buyer's Savings Plan and the Code, Transferred
Employees shall be eligible to roll over such distributions within sixty (60)
days of the distribution into Buyer's Savings Plan. To the extent requested by
Transferred Employees and permissible under Buyer's Savings Plan (and without
the requirement that Buyer amend such Plan), Buyer shall cause the trustee of
Buyer's Savings Plan to accept from the trustee of Sellers' Savings Plan cash
and cash equivalents representing the account balances of such Transferred
Employees under Sellers' Savings Plan.
9.5 ▇▇▇▇▇▇▇ Hourly Plan
As soon as practical after, but no later than sixty (60) days following, the
Closing, Seller shall provide Buyer a valuation of the ▇▇▇▇▇▇▇ Plant Hourly
Pension Plan (the "▇▇▇▇▇▇▇ Hourly Plan"). The parties agree to negotiate in good
faith the assumption, if appropriate, of the assets and obligations of the
▇▇▇▇▇▇▇ Hourly Plan.
9.6 Welfare Plans
UTAS shall be responsible for any medical, hospitalization, survivor benefits,
life insurance, disability, and other employee welfare benefit plan claims that
were incurred by any Transferred Employee (or his covered dependents) prior to
the Closing under Sellers' Plans that are employee welfare benefit plans and
Buyer shall be responsible for any such claim that is incurred by a Transferred
Employee (or his covered dependents) after Closing. Pursuant to the Employee
Benefits Transition Agreement, UTAS shall, if requested by Buyer, act as agent
for Buyer in processing such post- closing claims, and Buyer shall reimburse
UTAS for benefits paid by UTAS (as agent for Buyer) under that Agreement. Buyer
further agrees that Sellers shall have no responsibility in respect of the
Transferred Employees under the "continuation coverage" provisions of the
Consolidated Omnibus Budget Reconciliation Act of 1985, as amended, or Part 6 of
Title I of ERISA or any liability under section 4980B of the Code, as each
provision is in effect on the date hereof, solely as a result of the
consummation of the transactions contemplated hereby. For purposes of this
paragraph, a claim shall be deemed to be incurred on the date that the service
giving rise to the claim is rendered.
(b) To the extent permitted under Buyer's existing Plans, the Plans and other
employee benefits, programs and arrangements that are maintained by Buyer for
the benefit of Transferred Employees after the Closing Date and that are
employee welfare benefit plans shall provide that any expenses incurred by
Transferred Employees during 1996 on or before the Closing Date shall be taken
into account during the first plan year of such employee welfare benefit plans
for the purpose of satisfying deductible or coinsurance requirements and
satisfying maximum out-of-pocket provisions to the same extent as if such
expenses had been incurred after the Closing Date.
9.7 Plant Closings
Buyer agrees that, for a period of sixty (60) days following the Closing Date,
Buyer shall not cause a "plant closing" or "mass layoff" (as such terms are
defined in the Worker Adjustment and Retraining Notification Act ("WARN")) to
occur or undertake any other actions requiring notification pursuant to WARN to
union representatives and affected employees of the Steering Wheels N.A.
Business or units of local government where employment sites of the Steering
Wheels N.A. Business are maintained. Buyer further agrees and acknowledges that,
on and after the Closing Date, Buyer shall be solely responsible for compliance
with any United States federal, state, or local laws and regulations, and any
United Kingdom laws and regulations relating to plant closings or substantial
layoff of personnel in respect of the employment sites of ▇▇▇▇▇▇▇▇ or ▇▇▇▇▇▇▇.
Buyer will not be responsible for similar compliance in respect of employment at
the Monterrey, Mexico Facility and Niles, Michigan Facility.
9.8 Service Under Buyer's Plans
Buyer shall recognize all service of Transferred Employees with Sellers and its
predecessors under Buyer's Savings Plan, and in accordance with Sections 9.3,
9.4 and 9.5 and other employee benefit plans, programs and arrangements
maintained by Buyer, and for all seniority and vesting purposes.
9.9 Treatment of Buyer and Sellers
Buyers agree to treat, and to cause all of their affiliates to treat, the
Sellers and the Buyer as Predecessor and Successor Corporations, respectively,
pursuant to 26 CFR Section 31.13121 (a) (1)-(1)(b) and 26 CFR Section 31.3306
(b)(1)-1(b) for purposes of computing the annual wage limitations prescribed by
26 USC Section 3121 (a) (1) and 26 USC Section 3306 (b)(1) and the regulations
thereunder. Such treatment shall apply to all persons employed by the Sellers
and employed by the Buyer after the Closing.
The parties further agree to handle all reporting requirements mandated by 26
USC Section 6011 (a) and 26 USC Section 6051(a) and the regulations thereunder
under the procedures set forth in Section 5 ("Alternative Procedure") of Rev.
Proc. 83-66, 1983- 36 I.R.S. 15. The parties shall cooperate in the exchange of
information as contemplated by this Section 9.9. The Buyer shall reimburse the
Sellers' for any and all penalties assessed on the Sellers due to the Buyer's
failure to comply with 26 USC Section 6051(a) and regulations thereunder.
9.10 Assumption of Monterrey Collective Bargaining Agreement
(a) Buyer agrees to assume the applicable collective bargaining agreement for
the employees in the steering wheels operations of the Monterrey, Mexico
facility. UTAS de Mexico shall continue to provide and administer the employee
benefits of the hourly and salaried employees, and Buyer will reimburse UTAS de
Mexico for such costs, for a period of 6 months after the Closing, after which
time Buyer will assume all responsibility for providing and administering such
employee benefits.
(b) Buyer and Sellers agree to cooperate by making available to the other
information regarding the service of Transferred Employees with Sellers and
Buyer to enable Buyer and Sellers to determine the eligibility of Transferred
Employees to receive retirement benefits under each of the employee pension
benefit plans.
SECTION 10. CONDITIONS OF CLOSING
10.1 Conditions of the Buyer's Obligations
The obligations of the Buyer hereunder are subject to the satisfaction of all of
the following conditions as of the Closing Date, any of which may be waived by
the Buyer:
(a) each of the representations and warranties of the Sellers and IPCO contained
in this Agreement shall be true and correct in all material respects, except to
the extent that any inaccuracies in such representations and warranties shall
not have a material adverse effect on the financial condition or operations of
the Business taken as a whole. For the avoidance of doubt, it is specifically
agreed that the loss of any customer(s) who are also competitors of the Buyer in
the manufacture of air bag products as a result of the negotiations leading up
to the transactions contemplated hereby, and any effects of such loss, shall not
be a material adverse effect for the purpose of this Section 10.1(a);
(b) the Sellers and IPCO shall have performed in all material respects all of
their covenants and agreements hereunder and shall have delivered or caused to
be delivered the required documents, instruments, certificates and opinions at
the Closing as set forth in Section 11.1;
(c) no applicable statute, rule or regulation or order, decree or judgment of or
in any court or tribunal of competent jurisdiction shall be in effect that
prohibits Buyer from consummating the transactions contemplated hereby;
(d) all consents, approvals, orders or clearances of any governmental or
regulatory authority (including, without limitation, any approvals or clearances
of the Federal Trade Commission and the Antitrust Division of the Department of
Justice (including under the HSR Act), the United Kingdom, and other relevant
antitrust authorities) the granting of which is required or appropriate for the
consummation of the transactions contemplated hereby shall have been obtained
and all waiting periods specified under applicable law, the expiration of which
is necessary for such consummation shall have passed;
(e) Sellers shall have delivered to Buyer in form reasonably acceptable to Buyer
and in proper form for recording when appropriate, such deeds, bills of sale,
assignments, non-exclusive licenses and other good and sufficient instruments of
transfer conveying and transferring to Buyer the right, title and interest of
Sellers in and to the Transferred Assets, the Know-how and the Shares; and
(f) IPCO shall have delivered to Buyer in form reasonably acceptable to Buyer
assignments, documents and other good and sufficient instruments of transfer
conveying and transferring to Buyer the right, title and interest of Sellers in
and to the Patent Rights.
10.2 Conditions of the Sellers' Obligations
The obligations of the Sellers hereunder are subject to the satisfaction of all
of the following conditions as of the Closing Date, any of which may be waived
by the Sellers:
(a) each of the representations and warranties of the Buyer contained in this
Agreement shall be true and correct in all material respects;
(b) the Buyer shall have performed in all material respects all of its covenants
and agreements hereunder to be performed on or prior to the Closing Date and
shall have delivered or caused to be delivered the required documents,
instruments, certificates and opinions at the Closing as set forth in Section
11.2;
(c) the payments described in Section 3.1 due at the Closing shall have been
paid by the Buyer;
(d) no applicable statute, rule or regulation or order, decree or judgment of or
in any court or tribunal of competent jurisdiction shall be in effect that
prohibits Sellers from consummating the transactions contemplated hereby;
(e) all consents, approvals, orders, or clearances of any governmental or
regulatory authority (including, without limitation, any approvals or clearances
of the Federal Trade Commission and the Antitrust Division of the Department of
Justice (including under the HSR Act), the United Kingdom, and other relevant
antitrust authorities) the granting of which is required or appropriate for the
consummation of the transactions contemplated hereby shall have been obtained
and all waiting periods specified under applicable law, the expiration of which
is necessary for such consummation, shall have passed; and
(f) Buyer shall have entered into an Assumption Agreement dated the Closing
Date, in form and substance reasonably satisfactory to Sellers, in respect of
Buyer's assumption of the Assumed Liabilities.
(g) Buyer shall have executed and delivered assignments, documents and other
good and sufficient instruments of transfer contemplated by the Patent
License-Back Agreement in form reasonably acceptable to Sellers.
SECTION 11. CLOSING DOCUMENTS
11.1 (a) The Sellers' Obligations
At the Closing, the Sellers shall deliver or cause to be delivered to the Buyer
the following, in such form as counsel for the Buyer may reasonably request:
(1) certified copies of resolutions of the Boards of Directors of Sellers,
approving the execution, delivery and performance of this Agreement;
(2) a certificate of an officer or officers of the Sellers that, to the best of
his or her knowledge and except as he or she may therein specify, the warranties
and representations of the Sellers set forth in this Agreement are true and
correct in all material respects as of the Closing Date;
(3) a corporate warranty deed to the real estate described in Exhibit 2.1(a),
conveying marketable title in fee simple in such real estate to the Buyer,
subject only to the exceptions, encumbrances and restrictions (i) referred to in
Exhibit 5.7 as applicable to such real estate or (ii) approved by the Buyer's
counsel;
(4) an executed ▇▇▇▇ of sale and general assignment covering all of the personal
property to be transferred hereunder, assignments of UTAS's interest in or
obligations under all of the Assigned Contracts or the Assumed Liabilities in
effect on the Closing Date, as the case may be, and such other documents as are,
in the reasonable opinion of counsel for the Buyer, necessary or desirable to
vest title to the Transferred Assets in the Buyer;
(5) copies of any consents received to the assignments of the Assigned
Contracts;
(6) copies of UTAS' plan to comply with its obligations under Section 8.1 of the
Hankook-▇▇▇▇▇▇▇ Joint Venture Agreement;
(7) items identified in Section 3.3; and
(8) notwithstanding any language in this Section 11.1 (a) to the contrary, on or
before the third business day immediately preceding the Closing Date, the
Sellers shall deliver the ▇▇▇▇▇▇▇▇ Notice to the Buyer with respect to the
▇▇▇▇▇▇▇▇ Intercompany Financing.
(b) IPCO's Obligations
At the Closing, IPCO shall deliver to the Buyer documents of transfer for the
Patent Rights in such form as counsel for the Buyer may reasonably request.
11.2 The Buyer's Obligations
At the Closing, the Buyer shall deliver or cause to be delivered the following,
in such form as counsel for the Sellers may reasonably request:
(a) certified copies of the resolutions of the Board of Directors and, if
necessary, shareholders of Buyer approving the execution, delivery and
performance of this Agreement;
(b) a certificate of an officer of Buyer that, to the best of his or her
knowledge and except as he or she may therein specify, the warranties and
representations of the Buyer set forth in this Agreement are true and correct in
all material respects as of the Closing Date;
(c) evidence of one or more bank wire transfers in immediately available funds
to the accounts designated by Sellers of the specific amounts that the Buyer is
required to pay at Closing pursuant to Section 3.1 and 8.10 hereof;
(d) a duly executed Assumption Agreement; and
(e) a duly executed Patent License-Back Agreement.
SECTION 12. CLOSING EXPENSES AND APPORTIONMENTS
12.1 Sales Tax and Other Closing Expenses
The Buyer and the Sellers shall pay equally all excise, sales, transfer, stamp
duty, stamp duty reserve tax, documentary, filing, recordation and other similar
taxes, levies, fees and charges, if any (including all real estate transfer
taxes and conveyance and recording fees, if any), that may be imposed upon, or
payable or collectible or incurred in connection with this Agreement and the
transactions contemplated hereby. All other expenses of Closing will be paid by
the party incurring such expense.
12.2 Apportionments
All prepaid items which are transferred to the Buyer as part of the Transferred
Assets or are applicable to the Transferred Assets (including without
limitation, real estate and personal property taxes, water and sewer rents, if
any, utility charges and fuel oil), and which relate to a period both prior to
and subsequent to the Closing Date, will be apportioned between the parties
according to the number of days in the period covered by such prepaid item which
occurred prior to and subsequent to the Closing Date, respectively, and the
Buyer will pay to the Sellers at Closing the amount of such prepaid item
allocable to the period subsequent to the Closing Date.
12.3 Obligation to Pay Adjusted Final Purchase Price
Nothing contained in Section 12.1 or 12.2 shall be construed as a release,
limitation or other modification of the obligation of each party hereto to pay
or cause to be paid the full amount of any adjustment to the Cash Purchase Price
as described in Section 3.1(b) which becomes payable by such party under the
terms of this Agreement.
SECTION 13. POST CLOSING SURVIVAL AND INDEMNIFICATION
13.1 Survival
Except as to claims which are barred pursuant to Section 7.1(b), all
representations, warranties and covenants made in this Agreement shall survive,
and shall not be extinguished by, the Closing. All such representations and
warranties and all claims and causes of action with respect thereto (other than
the provisions of Sections 7.2 and 7.3 and all claims and causes of action with
respect thereto) shall terminate upon expiration of one year after the Closing
Date, provided that such termination shall not affect the rights of a party in
respect of any claim made by such party with specificity, in good faith and in a
writing received by the other party prior to the expiration of such one-year
period as hereinafter provided.
13.2 The Sellers' Indemnification
The Sellers hereby agree, subject to the provisions hereof, to assume and to
indemnify and hold the Buyer harmless from and after the date of this Agreement,
against and in respect of all losses, liabilities, damages or reasonable
expenses incurred by the Buyer (i) that result from any material
misrepresentation, breach of warranty or nonfulfillment of any covenant on the
part of the Sellers under this Agreement or contained in any agreement,
certificate or other instrument furnished by the Sellers at Closing, provided
that such claimed losses, liabilities, damages or reasonable expenses are
reasonably itemized and described in a written notice of claim signed by a duly
authorized officer of the Buyer and received by the Sellers within one (1) year
after the Closing Date (subject to Sellers' right to dispute such claim or any
portion thereof) or (ii) arising from or in connection with any Retained
Liabilities; provided, however, that any Environmental Claim shall be governed
by the provisions of Section 13.4 of this Agreement, and Buyer shall not be
entitled to recover for any such Environmental Claim pursuant to this Section
13.2.
Notwithstanding the foregoing, the Sellers shall not be obligated to indemnify
and hold the Buyer harmless for any such loss, liability, damage, or expense
unless (i) the amount for which indemnity would otherwise be due for any single
item of loss, liability, damage or expense exceeds Fifty Thousand Dollars
($50,000), or (ii) the total of all amounts for which indemnity would otherwise
be due for all such single items exceeds One Hundred Thousand Dollars ($100,000)
and then only up to twenty (20%) per cent of the Cash Purchase Price.
As a condition to any liability on the part of the Sellers under this Section
13.2, the Buyer shall notify the Sellers in writing of any fact or circumstance
which may give rise to liability under this Section 13.2 with reasonable
promptness after such fact or circumstance first comes to the attention of the
Buyer or any of its officers, agents or employees, and the Sellers and their
legal representatives shall have, at the Sellers' election, a right to
compromise or defend any such matter involving asserted liability through
counsel of their own choosing at the Sellers' expense. In the event the Sellers
undertake to compromise or defend any such liability, they shall notify the
Buyer in writing promptly of their intention to do so, and the Buyer shall
cooperate with the Sellers and their counsel in the compromising of or the
defending against any such liabilities or claims. The Sellers shall not be
liable under this Section for any settlement of any such matter effected without
their prior written consent, nor shall they be liable to the Buyer for any costs
of litigation or settlement if the Sellers undertake the defense of the action.
13.3 The Buyer's Indemnification
The Buyer hereby agrees, subject to the provisions hereof, to assume and to
indemnify and hold the Sellers and their directors, officers and employees
harmless from and after the date of this Agreement, against and in respect of
any losses, liabilities, damages or reasonable expenses incurred by the Sellers
(i) that result from any material misrepresentation, breach of warranty or
nonfulfillment of any covenant on the part of the Buyer under this Agreement or
the Assumption Agreement, or contained in any other agreement, certificate or
other instrument furnished by the Buyer at Closing, provided that such losses,
liabilities, damages or expenses are reasonably itemized and described in a
written notice of claim signed by a duly authorized officer of the Sellers and
received by the Buyer within one (1) year after the Closing Date, (ii) arising
from or in connection with any Assumed Liabilities or (iii) arising from or in
connection with the operation of the Business or the Real Property by the Buyer
after the Closing Date.
As a condition to any liability on the part of the Buyer under this Section
13.3, the Sellers shall notify the Buyer in writing of any fact or circumstance
which may give rise to liability under this Section 13.3 with reasonable
promptness after such fact or circumstance first comes to the attention of the
Sellers or any of their officers, agents or employees, and Buyer and its legal
representatives shall have, at the Buyer's election, a right to compromise or
defend any such matter involving asserted liability through counsel of its own
choosing at the Buyer's expense. In the event the Buyer undertakes to compromise
or defend any such liability, it shall notify the Sellers in writing promptly of
its intention to do so, and the Sellers shall cooperate with the Buyer and its
counsel in the compromising of or the defending against any such liabilities or
claims. The Buyer shall not be liable under this Section for any settlement
of any such matter effected without its prior written consent, such consent not
to be unreasonably withheld.
13.4 Environmental Indemnification
(a) Subject to the conditions, agreements and limitations set forth in this
Section 13.4, the Sellers shall indemnify and hold harmless the Buyer from and
against an amount equal to ninety percent (90%) of all losses, liabilities,
fines, damages or reasonable expenses incurred by the Buyer that result from any
Environmental Claim (as hereinafter defined). The Buyer shall be liable for the
balance of such losses, liabilities, fines, damages or expenses incurred by the
Buyer.
(b) The Buyer shall provide the Sellers and Sellers' agents with access to the
Indemnified Property and to the Buyer's books and records for the purposes of
inspecting, testing, auditing, installing and maintaining equipment and
performing such other actions as may be necessary or convenient to the Sellers
in performing its obligations under this Section 13.4 and in verifying the
performance by the Buyer of its obligations under this Section 13.4.
(c) The Buyer shall cooperate in any way reasonably requested by the Sellers to
enable the Sellers to perform their obligations under this Section 13.4. Such
cooperation shall include, but not be limited to, notifying the Sellers promptly
of any release of any Hazardous Substance and of any change in the Buyer's
Hazardous Waste management practices at the Indemnified Property. The Buyer
shall cooperate in any way reasonably requested by the Sellers in order to
effect the lawful disposition of any Hazardous Waste and other substances
recovered, generated or otherwise resulting from Sellers' performance of their
obligations under this Section 13.4, including obtaining any necessary generator
identification numbers.
(d) The Sellers shall have the right in consultation with Buyer to conduct all
discussions and negotiations with all governmental agencies and third parties
with respect to matters that are related to, or may result in, a claim by the
Buyer for indemnity under this Section 13.4, and the Sellers shall promptly
inform the Buyer of all material developments and negotiations relating to such
matters. The Buyer shall not disclose to or discuss with any third party the
terms of this Section 13.4 or any matter related to, or that may result in, a
claim by the Buyer for indemnity under this Section 13.4 without the prior
written consent of the Sellers.
(e) If the Sellers' obligations under this Section 13.4 require any removal,
remedial or corrective action with respect to any environmental medium, such
action shall be under the control of the Sellers and the Sellers' obligations to
the Buyer under this Section 13.4 shall have been satisfied if the Sellers
perform such removal, remedial or corrective action in accordance with the
applicable state, local or federal industrial site remediation standards in
effect on the Closing Date or agency approval.
(f) Upon receipt of timely notice of any threatened or pending Environmental
Claim that may result in a claim by the Buyer for indemnity under this Section
13.4, together with appropriate evidence in support of such claim, the Sellers
shall assume, or cause to be assumed, the defense of such Environmental Claim,
in which event the Sellers shall be deemed to have been authorized to act in
their sole discretion to defend against or to compromise such Environmental
Claim by whatever means they determine to be appropriate provided such
compromise shall not cause a material adverse effect to Buyer's operations, and
to direct and conduct, as they see fit, all negotiations and litigation in
connection with such Environmental Claim. The Sellers shall promptly notify the
Buyer of all material developments concerning such defense, and, if the Buyer
elects to employ separate counsel (at the Buyer's expense), such counsel shall
be entitled to participate in such defense; provided, however, that such
participation shall not include the taking of any action that the Sellers'
counsel deems adverse to the Sellers' interests. Upon giving timely notice of
any Environmental Claim, the Buyer shall have no further obligation under this
Section 13.4 with respect to such Environmental Claim, except that the Buyer
shall cooperate with the Sellers in the defense or compromise of any such
Environmental Claim including, without limiting the generality of the foregoing,
providing such access to the Indemnified Property, documents, and other
information and assistance as the Sellers may reasonably request.
(g) The provisions of Section 13.2 of this Agreement shall not apply to this
Section 13.4. In no event shall the Sellers be obligated under this Section 13.4
to make any payments or to incur any obligations in an aggregate amount
exceeding One Million Dollars ($1,000,000). The Sellers' indemnity hereunder is
for the exclusive benefit of the Buyer and shall not be for the benefit of any
other person or entity. The Buyer's rights, interests and obligations under this
Section 13.4 may not be assigned by it but may be assigned by operation of law.
(h) Notwithstanding any other provision of this Agreement to the contrary, with
respect to Environmental Claims the Sellers shall not be required to indemnify
or hold harmless the Buyer or otherwise compensate the Buyer:
(i) unless, with respect to the Environmental Claim in question: (a) a legal or
administrative proceeding has been commenced by the second anniversary of the
Closing Date and (b) the Buyer has provided to the Sellers written notice of the
Environmental Claim (including all documentation and information related to such
Environmental Claim that is available to the Buyer) no later than fifteen (15)
business days after the Buyer becomes aware that the Environmental Claim is
pending;
(ii) to the extent that the Environmental Claim in question results or arises
from the Buyer's or a third party's activities, operations or conduct or by an
act of God or war after the Closing Date;
(iii) if the Buyer fails to perform any of the obligations it owes to Sellers
under this Section 13.4;
(iv) to the extent that the Buyer would have been responsible for the
Environmental Claim in question even if the Buyer had not acquired the
Transferred Assets or Shares as the case may be;
(v) to the extent any Environmental Condition is exacerbated after the Closing
Date by the release of any Hazardous Substance or by any other act or omission
of the Buyer or of any third persons; or
(vi) unless and until the aggregate of all losses, liabilities, fines, damages
and reasonable expenses incurred by Buyer that result from Environmental Claims
exceeds Fifty Thousand Dollars ($50,000) and then only up to an amount equal to
One Million Dollars ($1,000,000).
(i) Except as provided in this Section 13.4, the Buyer agrees that it shall not
have (and shall not make or attempt to assert) any claim against the Sellers,
for indemnity, contribution, or otherwise with respect to any Environmental
Condition or for indemnity, contribution or otherwise under any other provision
of this Agreement, the Resource Conservation and Recovery Act of 1976, as
amended ("RCRA"), the Comprehensive Environmental Response, Compensation and
Liability Act, as amended, 42 U.S.C. Section 9601 et seq. ("CERCLA"), or other
federal, state, local, common or statutory law, regulation, ordinance, order or
similar requirement now or hereafter enacted, amended or promulgated, protecting
or regulating or creating a duty in connection with human health, natural
resources or the environment.
(j) For purposes of this Section 13.4, the following terms shall have the
meaning set forth below:
"Environmental Claim" shall mean any legal or administrative proceeding, whether
pending or commenced, before or after the Closing Date, by any governmental
agency or other third party as a result of any Environmental Condition and
brought under any Environmental Law existing on or before the Closing Date.
"Environmental Condition" shall mean the presence of any Hazardous Substance or
Hazardous Waste, at the Indemnified Property in the surface water, groundwater,
soil, above ground or underground tanks or other containers, or ambient air,
which resulted from the Sellers' operation of the Business at the Indemnified
Property prior to the Closing Date.
"Environmental Law" shall mean (i) any law, statute, regulation, order, or
directive of a federal, state or local governmental entity and (ii) any common
law doctrine (including, but not limited to contractual theories or causes of
action and tort doctrines such as negligence, nuisance, trespass and strict
liability or any equitable doctrine (including, but not limited to injunctive
relief), in each case as in effect on the Closing Date.
"Hazardous Substance" shall mean (i) any "hazardous substance" within the
meaning of Section 101 (14) of CERCLA or any counterpart provision of any
similar state or local law, (ii) any "pollutant or contaminant" within the
meaning of Section 101 (33) of CERCLA or any counterpart provision of any
similar state or local law and (iii) petroleum, including crude oil or any
fraction thereof, natural gas, liquefied natural gas and synthetic gas.
"Hazardous Waste" shall mean a waste which is identified as such pursuant to
Section 3001 of RCRA.
"Indemnified Property" shall mean the Real Property and the real property at
which ▇▇▇▇▇▇▇▇ conducts its operations.
13.5 Exclusive Remedy
The Buyer hereby acknowledges and agrees that, from and after the Closing, its
sole remedy with respect to any and all claims relating to the Business, the
Transferred Assets or the subject matter of this Agreement shall be pursuant to
the indemnification provisions set forth in this Section 13. In furtherance of
the foregoing, the Buyer hereby waives, from and after the Closing, to the
fullest extent permitted by law, any and all other rights, claims and causes of
action it may have against the Sellers or their officers, directors, employees,
agents, representatives and affiliates relating to the Business, the Transferred
Assets or the subject matter of this Agreement.
13.6 Lost Profits and Special Damages
Notwithstanding any other provision of this Agreement to the contrary, the
Sellers shall not be required to indemnify or hold harmless the Buyer or
otherwise compensate the Buyer for damage to reputation, lost business
opportunities, lost profits, mental or emotional distress, incidental, special,
exemplary, indirect or consequential damages, interference with business
operations or diminution of the value of the Real Property.
SECTION 14. TERMINATION
14.1 Termination of Agreement
The obligation of the parties hereto to consummate the purchase and sale
contemplated hereby may be terminated and abandoned at any time on or before the
Closing Date, without cost, expense or liability to the other party, by mutual
written consent of the parties hereto, or by and at the option of the Sellers
upon written notice to the Buyer if, for any reason, the Closing Date shall not
have occurred on or before November 30, 1996, or at the option of either party
hereto, so long as such party is not in material breach of any provisions of
this Agreement, upon written notice to the other if any temporary restraining
order, preliminary or permanent injunction or other legal restraint or
prohibition preventing the consummation of the transactions contemplated by this
Agreement shall be in effect, or an action or proceeding seeking damages in
connection with the acquisition of the Transferred Assets has been instituted
and an adverse decision in such action or proceeding would have a material
adverse effect on such party, the Transferred Assets or the Business.
14.2 Effect of Termination
Termination of this Agreement pursuant to this Section 14 shall terminate all
obligations of the parties hereto; provided, however, that termination pursuant
to Section 14.1 shall not relieve the defaulting or breaching party hereunder
from any liability to the other party hereto resulting from the default or
breach hereunder of such defaulting or breaching party occurring prior to the
date of termination. If this Agreement is terminated pursuant to the provisions
of this Section 14, the provisions set forth in Sections 7.1(c), 13.2, 13.3,
14.2, 14.3, 16.1, 16.2, 16.6, and 16.14 shall survive any such termination.
14.3 Return of Information
If for any reason whatsoever the sale and purchase of the Shares and the
Steering Wheels N.A. Business pursuant to this Agreement is not consummated,
Buyer shall, in addition to its obligations under the Nondisclosure Agreement,
upon request from Sellers, promptly return to Sellers all books, records and
documents (including all copies, if any, thereof) furnished by ▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇ Inc., or any of their respective agents, employees, or
representatives.
SECTION 15. USE OF TRADEMARKS AND TRADE NAMES
15.1 Trademarks and Trade Names
Other than on purchase orders and invoices, the Buyer may continue to use
existing packaging, advertising literature and the like until the supply of such
documents is exhausted or until six (6) months after the Closing Date, whichever
is earlier; provided, however, the Buyer shall cause a label or stamped
disclaimer, in a form satisfactory to Sellers, to be placed on all packaging,
advertising literature and the like which bears a trademark, logo, service ▇▇▇▇
or trade name of the Sellers which are distributed or sold during this six (6)
month period. Subsequent to the Closing, the Buyer shall utilize only purchase
orders (and associated documents) and invoices (and associated documents) with
the Buyer's name (not the Sellers') clearly imprinted. Subject to Section 15.2,
Buyer shall be provided a reasonable opportunity to remove from or cover each
trademark, logo, service ▇▇▇▇ or trade name of the Sellers that appears on all
equipment, tools and dies, but where such removal or covering is uneconomical or
impractical, Sellers and Buyer agree to enter into good faith negotiations with
an intent to agree upon reasonable alternatives to such removal or covering.
15.2 Representations as to Products
Under no circumstances shall the Buyer or its affiliates make any representation
that the Business products are either manufactured, assembled, sold or
maintained by or are the products of the Sellers or their affiliates.
SECTION 16. MISCELLANEOUS
16.1 Public Announcements
Any public announcements or similar publicity with respect to this Agreement or
the transactions contemplated herein shall only be made at such time and in such
manner as the parties hereto shall agree in writing; provided, that nothing
herein shall prevent either party upon notice to the other from making such
public announcements as such party's counsel may advise such party in writing to
make in order to satisfy that party's legal or contractual obligations in such
regard.
16.2 Costs and Expenses
Except as expressly otherwise provided in this Agreement, each party hereto
shall bear its own costs and expenses in connection with this Agreement and the
transactions contemplated hereby.
16.3 Passage of Title and Risk of Loss
Legal title, equitable title and risk of loss with respect to the property and
rights to be transferred hereunder shall not pass to the Buyer until the
property or right is transferred at the Closing hereunder; provided, however,
that if there is any loss of any material portion of the Transferred Assets
between the date hereof and the Closing and the Buyer elects to complete the
Closing without reduction of the Cash Purchase Price on account of such loss,
the Buyer shall be entitled to the proceeds of any insurance payable with
respect to the loss of such Transferred Assets, excluding proceeds of any
business interruption insurance from the date hereof to the Closing Date.
16.4 Waiver of Compliance with Bulk Sales Law
The Buyer hereby waives compliance by the Sellers with the provisions of any
applicable Bulk Sales Law. The Sellers hereby agree to indemnify and hold the
Buyer harmless from any loss, cost or liability (including reasonable attorneys'
fees) incurred by the Buyer as a result of such non-compliance; provided that
nothing herein shall prevent the Sellers from contesting any liability in good
faith.
16.5 Knowledge of Sellers
For purposes of this Agreement, a fact shall be deemed to be within the
"knowledge of the Sellers" if it is actually known to one of the executive
officers of UTA, UTAS, or ▇▇▇▇▇▇▇▇, whose names are listed in Exhibit 16.5.
16.6 Notices
All notices required or permitted hereunder shall be in writing and shall be
deemed to be properly given when personally delivered or by certified or
registered first class mail, postage prepaid, (return receipt requested)
properly addressed to the party entitled to receive such notice at the address
stated below:
If to Buyer:
BREED Technologies, Inc.
▇▇▇▇ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: President
With a copy to:
BREED Technologies, Inc.
▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: General Counsel
If to Sellers or IPCO:
United Technologies Automotive, Inc.
▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: Vice President-Business Development
and Legal Affairs
With a copy to:
United Technologies Automotive, Inc.
▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: General Counsel
Any notice given by mail shall be effective when received.
16.7 Exhibits
The Exhibits attached to this Agreement are made a part of this Agreement for
all purposes hereof. The information contained in the Exhibits shall not be
deemed to constitute an admission by Sellers or Buyer or otherwise imply that
any such information is material for purposes of this Agreement or otherwise.
16.8 Successors and Assigns
This Agreement shall be binding upon and shall inure to the benefit of the
parties hereto and their respective successors and permitted assigns, except as
expressly otherwise provided in this Agreement, but neither party hereto may
assign any of its rights or liabilities hereunder without the prior written
consent of the other party hereto, such consent not to be unreasonably withheld.
16.9 Further Actions
From time to time after the date of this Agreement, as and when requested by
either party hereto, the Sellers or the Buyer shall execute and deliver, or
cause to be executed and delivered, such documents and instruments and shall
take, or cause to be taken, such further or other actions as the Buyer or the
Sellers may deem necessary or desirable to carry out the intent and purposes of
this Agreement, to convey, transfer, assign and deliver to the Buyer, and its
successors and permitted assigns, the Transferred Assets, the Shares or the
Assumed Liabilities (or to evidence any of the foregoing) and to consummate and
give effect to the other transactions, covenants and agreements contemplated
hereby. The Buyer shall assist the Sellers in the settling of any dispute with
reference to any liability retained by the Sellers, including using its best
efforts to have its officers and other employees cooperate with the Sellers at
their request, on and after the Closing Date, in furnishing information,
evidence, testimony and other assistance in connection with any actions,
proceedings, arrangements or disputes based upon contracts, arrangements or acts
of the Sellers which were in effect or occurred on or prior to the Closing Date.
16.10 Waiver, Discharge, Amendment, Etc.
This Agreement may not be released, discharged, abandoned, changed, amended or
modified in any manner, except pursuant to Section 14 or by an instrument in
writing signed on behalf of each of the parties hereto by their duly authorized
officers or representatives. The failure of any party hereto to enforce at any
time any of the provisions of this Agreement shall in no way be construed to be
a waiver of any such provision, nor in any way to affect the validity of this
Agreement or any part thereof or the right of any party thereto to enforce each
and every such provision. No waiver of any breach of this Agreement shall be
held to be a waiver of any other or subsequent breach.
16.11 Captions
The Captions appearing in this Agreement are inserted only as a matter of
convenience and as a reference and in no way define, limit or describe the scope
or intent of this Agreement or any of the provisions hereof.
16.12 Governing Law
ALL QUESTIONS CONCERNING THE CONSTRUCTION, VALIDITY AND INTERPRETATION OF THIS
AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAW
OF THE STATE OF MICHIGAN, WITHOUT GIVING EFFECT TO ITS PRINCIPLES OF CONFLICTS
OF LAW.
16.13 Jurisdiction and Venue
Buyer and Sellers hereby irrevocably and unconditionally submit to the exclusive
jurisdiction of the state and federal courts located in ▇▇▇▇▇ County, State of
Michigan, for any actions, suits, or proceedings arising out of or relating to
this Agreement and the transactions contemplated hereby (and Buyer and Sellers
agree not to commence any action, suit or proceeding relating thereto except in
such courts), and further agree that service of any process, summons, notice or
document by U.S. registered mail to its address set forth above shall be
effective service of process of any action, suit or proceeding brought against
it in any such court. Buyer and Sellers hereby irrevocably and unconditionally
waive any objection to the laying of venue of any action, suit or proceeding
arising out of this Agreement or the transactions contemplated hereby in such
state or federal courts as aforesaid and hereby further irrevocably and
unconditionally waive and agree not to plead or claim in any such court that any
such action, suit or proceeding brought in any such court has been brought in an
inconvenient forum. Sellers and Buyer waive any rights they may have to a jury
trial.
16.14 Rights of Persons Not Parties
Other than as expressly provided in this Agreement, nothing contained in this
Agreement is intended to confer upon any person other than the parties hereto
any rights, benefits or remedies.
16.15 Counterparts
This Agreement may be executed in one or more counterparts, each of which shall
be deemed to be an original, but all of which shall be considered one and the
same instrument.
16.16 Entire Agreement
This Agreement and the Assumption Agreement including the Exhibits hereto and
the documents referred to therein, shall (with the exception of the
nondisclosure agreement executed by the parties as of May 20, 1996) constitute
the entire agreement between the parties hereto with respect to the subject
matter hereof and shall supersede all previous negotiations, understandings,
agreements, commitments, and writings with respect to such subject matter.
Matters disclosed in any Exhibit, related agreement, certificate, document,
instrument or other writing referred to herein shall be deemed to be disclosed
in any other Exhibit, related agreement, certificate, document, instrument or
other writing referred to herein.
16.17 Severability
In the event any of the provisions, or portions thereof, of this Agreement are
held to be unenforceable or invalid by any court of competent jurisdiction, the
validity and enforceability of the remaining provisions, or portions thereof,
shall not be affected thereby. Any provision so held unenforceable or invalid
shall be reformed by such court to reflect the construction most nearly
approximating the intent of such provision which shall be valid and enforceable,
and the parties hereto hereby agree to such provision as reformed.
16.18 Non-Competition Agreement
(a) For a period of three (3) years after the Closing Date, Sellers or a joint
venture in which Sellers participate, the principal purpose of which is to
manufacture Competing Products (as defined herein), shall not develop,
manufacture, market or sell the following:
(i) Steering Wheels
products that are part of the steering wheel control system currently produced
as part of the Business, are connected to the steering column and are used to
control the direction of the vehicle, or
(ii) Steering Wheel Air Bag Covers
products that are housed within or are an extension of the steering column, are
an integrated portion of the steering wheel safety restraint system and are
integrated within the steering wheel as currently produced as part of the
Business (the products described in this Section 16.18(a)(i) and (ii), as
limited by the time period noted in Section 16.18(a) and the geographic scope as
noted in Section 16.18(b), are herein referred to as the "Competing Products");
provided, however, that Sellers shall not be in violation of this Section
16.18(a) as a result of the acquisition by it of any business, the revenues of
which are attributable to any such Competing Products, so long as Sellers within
one year of such acquisition sell such portions of the acquired business that
produce, manufacture and distribute the Competing Products.
(b) The geographic scope of this Non-Competition Agreement shall be the United
States, the United Kingdom and any other country in which the Sellers have
conducted a material portion of its Business during the two years prior to the
Closing Date.
(c) The parties hereto agree that the duration and geographic scope of the non-
competition provision set forth in this Section 16.18(a) and (b) are reasonable.
In the event that any court of competent jurisdiction determines that the
duration or the geographic scope, or both, are unreasonable and that such
provision is to that extent unenforceable, the parties hereto agree that the
provision shall remain in full force and effect for the greatest time period and
in the greatest geographic area that would not render it unenforceable. The
parties intend that this non-competition provision shall be deemed to be a
series of separate covenants, one for each and every county of each and every
state of the United States of America and each and every political subdivision
of each and every country outside the United States of America where this
provision is intended to be effective. The Sellers agree that damages are an
inadequate remedy for any breach of this provision and that the Buyer shall, to
the extent permitted by law and the principals of equity, whether or not Buyer
is pursuing any potential remedies at law, be entitled to seek equitable relief
in the form of preliminary and permanent injunctions without bond or other
security upon any actual or threatened breach of this non-competition provision.
(d) Notwithstanding the foregoing, it is expressly agreed and acknowledged that
the Sellers shall, without being in violation of this Section 16.18, begin or
continue to develop, manufacture, market or sell the following: (i) other air
bag covers for interior products that include or are part of the automotive
safety restraint system other than as described in Section 16.18(a)(ii),
including, but not limited to, instrument panels, door panels, headliners and
seats and (ii) electrical, electronic and electro-mechanical automotive parts
and components that may be attached upon, integrated in or incidental to an
automotive steering wheel, steering wheel column or steering wheel air bag
cover.
16.19 No Solicitation or Hiring of Former Employees
Except as provided by law, for a period of three years after the Closing Date,
Sellers shall not (a) solicit any Transferred Employee to terminate his or her
employment with the Buyer or to become an employee of Sellers, or (b) hire any
Transferred Employees without the written consent of Buyer.
IN WITNESS WHEREOF, each of the parties hereto has duly executed this Agreement
as of the date first written above.
UT AUTOMOTIVE, INC.
By /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇.
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇.
Title: Representative
UNITED TECHNOLOGIES
AUTOMOTIVE SYSTEMS, INC.
By /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇.
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇.
Title: Assistant Secretary
UNITED TECHNOLOGIES
AUTOMOTIVE SYSTEMS de
MEXICO, S.A. de C.V.
By /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇.
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇.
Title: Assistant Secretary
IPCO, INC.
By /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇.
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇.
Title: Representative
BREED TECHNOLOGIES, INC.
By /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇
Title: Assistant Secretary
INDEX OF DEFINED TERMS
TERMS LOCATION
"Adjusted Final Purchase Price" Section 3.1(b)
"Allocation Certificate" Section 3.2
"Antitrust Laws" Section 5.4
"Assigned Contracts" Section 2.1(d)
"Assumed Liabilities" Section 4.1
"Business" 1ST Whereas Clause
"Buyer's ▇▇▇▇▇▇▇ Plan" Section 9.5(b)
"Buyer's Savings Plan" Section 9.4
"Buyer" Preamble
"Cash Purchase Price" Section 3.1
"CERCLA" Section 13.4(i)
"▇▇▇▇▇▇▇▇" 1ST Whereas Clause
"▇▇▇▇▇▇▇▇ Intercompany Financing" Section 5.2(b)
"▇▇▇▇▇▇▇▇ Notice" Section 8.10
"▇▇▇▇▇▇▇▇ Payees" Section 5.2(b)
"Closing" Section 1
"Closing Date" Section 1
"Closing Date Balance Sheet" Section 3.1(b)
"Closing Date Net Working Capital" Section 3.1(b)
"Code" Section 5.17(a)
"Competing Products" Section 16.18(a)(ii)
"Consent" Section 5.19
"Environmental Claim" Section 13.4(j)
"Environmental Condition" Section 13.4(j)
"Environmental Law" Section 13.4(j)
"ERISA" Section 5.17(a)
"Excluded Assets" Section 2.2
"Exon-▇▇▇▇▇▇ Act" Section 5.4
"Fixtures" Section 5.23
"Hankook" 7TH Whereas Clause
"Hankook Interest" 7TH Whereas Clause
"Hazardous Substance" Section 13.4(j)
"Hazardous Waste" Section 13.4(j)
"HSR Act" Section 5.19
"Indemnified Property" Section 13.4(j)
"Intellectual Property" 11TH Whereas Clause
"Interim Balance Sheet" Section 3.1(b)
"Interim Net Working Capital" Section 3.1(b)
"IPCO" Preamble
"Joint Venture Agreement" Section 2.4
"Know-how" Section 2.5
"Leases" Section 5.9
"Material Contract" Section 5.12
"Patent Rights" Section 2.5
"Permitted Encumbrances" Section 5.7
"Plans" Section 5.17(a)
"RCRA" Section 13.4(i)
"Real Property" Section 2.1(a)
"Records" Section 2.1(i)
"Retained Liabilities" Section 4.2
"Sellers' ▇▇▇▇▇▇▇ Plan" Section 9.5(a)
"Sellers' Salaried Retirement Plan" Section 9.3
"Sellers' Savings Plan" Section 9.4
"Sellers" Preamble
"Shares" 6TH Whereas Clause
"Steering Wheels N.A. Business" 1ST Whereas Clause
"Subsidiary" Section 5.2(a)
"Transferred Assets" Section 2.1
"Transferred Employees" Section 9.1
"UTA" Preamble
"UTAS" Preamble
"UTAS de Mexico" Preamble
"WARN" Section 9.7