FIRST AMENDED
ASSET PURCHASE AGREEMENT
Between
HUNTSMAN POLYMERS CORPORATION
and
HUNTSMAN PACKAGING CORPORATION
(Regarding Assets of the CT Film Division of Huntsman Polymers Corporation)
Dated as of September 26, 1997
TABLE OF CONTENTS
Page
1. PURCHASE AND SALE OF ASSETS..........................................2
1.01. Purchase and Sale.........................................2
1.02. Payment of Purchase Price.................................2
1.03. Acquired Assets...........................................2
1.04. Excluded Assets...........................................5
1.05. Assumed Liabilities.......................................6
1.06. Excluded Liabilities......................................6
1.07. Title to Acquired Assets..................................8
1.08. Consents of Third Parties.................................8
2. THE CLOSING..........................................................9
2.01. Closing Date..............................................9
2.02. Transactions to be Effected at the Closing................9
2.03. Other Action.............................................10
2.04. No Additional Obligations................................10
2.05. Loss, Destruction, Condemnation, or Damage...............10
3. REPRESENTATIONS AND WARRANTIES OF SELLER............................10
3.01. Organization.............................................10
3.02. Authorization and Validity of Agreement..................11
3.03. No Violations; Consents and Approvals....................12
3.04. Subsidiary Capitalization................................12
3.05. SEC Reports and Financial Statements.....................13
3.06. Absence of Certain Changes...............................13
3.07. No Undisclosed Liabilities...............................14
3.08. Employee Benefit Plans and ERISA.........................14
3.09. Litigation and Compliance with Law.......................17
3.10. ▇▇▇▇▇▇ Intellectual Property.............................18
3.11. Seller Agreements........................................18
3.12. Taxes....................................................19
3.13. Environmental Matters....................................21
3.14. No Default...............................................23
3.15. Brokers..................................................23
3.16. Property.................................................23
3.17. Labor Matters............................................24
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4. REPRESENTATIONS AND WARRANTIES OF PURCHASER.........................24
4.01. Organization.............................................24
4.02. Authorization and Validity of Agreement..................24
4.03. No Violations; Consents and Approvals....................25
5. COVENANTS...........................................................25
5.01. Plicon Collection. .....................................25
5.02. Access to Information....................................25
5.03. Further Action; Reasonable Best Efforts..................26
5.04. Post-Closing Cooperation.................................27
5.05. Employee Benefits........................................28
5.06. Notification of Certain Matters..........................31
5.07. Expenses.................................................31
5.08. Waiver of Compliance with Bulk Sales Laws................31
5.09. Transfer, Sales, and Use Taxes...........................31
5.10. Purchase Price Allocation................................32
5.11. WARN Compliance..........................................32
6. CONDITIONS..........................................................32
6.01. Conditions to Each Party's Obligation....................32
6.02. Conditions to Obligation of Purchaser....................33
6.03. Conditions to Obligation of Seller.......................35
7. TERMINATION OF AGREEMENT............................................35
7.01. Termination..............................................35
7.02. Effect of Termination....................................36
8. INDEMNIFICATION.....................................................36
8.01. Indemnification by Seller................................36
8.02. Indemnification by Purchaser.............................37
8.03. Calculation of Losses....................................38
8.04. Termination of Indemnification...........................38
8.05. Procedures...............................................38
9. GENERAL PROVISIONS..................................................40
9.01. Assignment...............................................40
9.02. No Third-Party Beneficiaries.............................40
9.03. Amendments and Waivers...................................41
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9.04. Notices..................................................41
9.05. Interpretation...........................................41
9.06. Survival of Agreements...................................42
9.07. Counterparts.............................................42
9.08. Entire Agreement.........................................42
9.09. Severability.............................................42
9.10. Governing Law; Waiver of Jury Trial; Enforcement.........42
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TABLE OF DEFINED TERMS
Term: Section:
Acquired Assets 1.03
Acquisition 1.01
Affiliate 9.05
Allocation 5.10
Assigned Contracts 1.03(k)
Assigned Intellectual Property 1.03(h)
Assigned Permits 1.03(j)
Assumed Liabilities 1.05
Audits 3.12(b)
Business Recitals
Business Executives 5.02(a)
Buyer Defined Benefit Plan 5.05(b)
Chippewa Facility 1.03(a)
Clearfield Facility 1.03(a)
Closing 2.01
Closing Date 2.01
Code 3.08(e)
Company Employees 5.05(a)
Company SEC Documents 3.05
Contracts 1.03(k)
▇▇▇▇▇▇ Facility 1.03(a)
Disclosure Schedule 3.
Effective Time 5.05(g)
England Shares 1.03(q)
England Subsidiary 1.03(q)
Environmental Claim 3.13(e)
Environmental Laws 3.13(e)
ERISA 3.08(a)
ERISA Affiliate 3.08(a)
ERISA Plans 3.08(a)
Exchange Act 3.05
Excluded Assets 1.04
Excluded Liabilities 1.06
Existing Credit Facilities 1.06(c)
Film Manufacturing Facilities 1.03(a)
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GAAP 3.05
Governmental Entity 3.03
▇▇▇▇▇▇▇▇▇▇ Facility 1.03(a)
Hazardous Substance 3.13(e)
Huntsman Recitals
Intellectual Property 1.03(h)
Inventory 1.03(f)
Investments 1.03(l)
Knowledge of Seller 3.06
Liens 1.07
Losses 8.01
Material Adverse Effect 3.01
Material Seller Agreements 3.11
Merger Recitals
Merger Agreement Recitals
PBGC 3.08(b)
Permits 1.03(j)
Permitted Liens 1.07
Person 3.01
Personal Property 1.03(d)
Plans 3.08(a)
Purchase Price 1.01
Purchaser Recitals
Receivables 1.03(g)
Records 1.03(p)
Release 3.13(e)
Representatives 5.02(a)
▇▇▇▇▇▇ Intellectual Property 3.10
▇▇▇▇▇▇ Pension Plan 5.05(b)
▇▇▇▇▇▇ SERP 5.05(f)
Sales and Use Taxes 5.09
Sales Office Facilities 1.03(b)
SEC 3.05
Securities Act 3.05
Seller Recitals
Seller Agreements 3.03
Seller Defined Benefit Plan 5.05(b)
Subsidiary 3.01
Tax Return 3.12(j)
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Taxes 3.12(j)
Technology 1.03(i)
Third Party Claim 8.05(a)
Transfer Taxes 5.09
Warehouse Facilities 1.03(c)
WARN 5.11
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FIRST AMENDED
ASSET PURCHASE AGREEMENT
THIS FIRST AMENDED ASSET PURCHASE AGREEMENT (this "Agreement") is
made and entered into as of the 26th day of September, 1997, by and between
HUNTSMAN POLYMERS CORPORATION, formerly known as ▇▇▇▇▇▇ Corporation, a
Delaware corporation ("Seller"), and HUNTSMAN PACKAGING CORPORATION, a Utah
corporation ("Purchaser").
RECITALS:
A. Pursuant to the provisions of a certain Agreement and Plan of
Merger (the "Merger Agreement") dated as of June 9, 1997, by and among Seller,
Huntsman Centennial Corporation, a Utah corporation ("Centennial"), and
Huntsman Corporation, a Utah corporation ("Huntsman"), Centennial was merged
with and into Seller (the "Merger").
B. Seller and one or more of its Subsidiaries own and operate a
polymer film manufacturing business known as the "CT Film Division" (the
"Business").
C. Seller desires to sell to Purchaser, and Purchaser desires to
purchase from Seller, all or substantially all of the assets of the Business,
upon the terms and subject to the conditions of this Agreement.
D. Seller and Purchaser have entered into an Asset Purchase Agreement
dated as of August 27, 1997 (the "Original Agreement"), pursuant to the terms,
conditions, and provisions of which (among other things) Seller agreed to sell
to Purchaser, and Purchaser agreed to purchase from Seller, all or
substantially all of the assets of the Business.
E. Seller and Purchaser now desire to amend the Original Agreement in
its entirety and to agree in writing as to certain related matters.
NOW, THEREFORE, in consideration of the mutual covenants and
agreements herein contained, and for other good and valuable consideration,
receipt and sufficiency of which are acknowledged, Seller and Purchaser hereby
amend the Original Agreement to read in its entirety, and otherwise hereby
agree, as follows:
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1. PURCHASE AND SALE OF ASSETS
1.01. Purchase and Sale. On the terms and subject to the conditions
of this Agreement, at the Closing (as defined in Section 2.01), Seller shall
sell, assign, transfer, convey, and deliver to Purchaser, and Purchaser shall
purchase from Seller, all the right, title, and interest of Seller in, to, and
under the Acquired Assets (as defined in Section 1.03), for (a) an aggregate
purchase price of Seventy Million Dollars ($70,000,000) (the "Purchase
Price"), payable as set forth in Section 1.02, and (b) the assumption of the
Assumed Liabilities (as defined in Section 1.05). The purchase and sale of the
Acquired Assets and the assumption of the Assumed Liabilities is referred to
in this Agreement as the "Acquisition."
1.02. Payment of Purchase Price. The Purchase Price shall be paid to
Seller in full at the Closing as provided in Section 2.02(b)(i).
1.03. Acquired Assets. The term "Acquired Assets" means all of the
business, properties, assets, good will, and rights of Seller and its
Subsidiaries (as defined in Section 3.01) of every kind, character, and
description, tangible or intangible, real, personal, or mixed, whether
accrued, contingent, or otherwise, that are owned, leased, or licensed by
Seller or any of its Subsidiaries on the Closing Date (as defined in Section
2.01) and primarily used, primarily held for use, or intended to be primarily
used in the operation or conduct of the Business, wherever located and whether
or not reflected in the books and records of Seller or any of its
Subsidiaries, other than the Excluded Assets (as defined in Section 1.04),
including:
(a) Film Manufacturing Facilities. The entire right, title,
and interest of Seller and any of its Subsidiaries in and to all
manufacturing, warehouse, laboratory, and other facilities located in (i)
Chippewa Falls, Wisconsin (the "Chippewa Facility"), (ii) Clearfield, Utah
(the "Clearfield Facility"), (iii) Dalton, Georgia (the "▇▇▇▇▇▇ Facility"),
and (iv) Harrington, Delaware (the "Harrington Facility"), including Seller's
interests in the parcels of real property related thereto, together with and
including the entire right, title, and interest of Seller in and to all
buildings, structures, installations, fixtures, and other improvements thereto
or situated thereon and all other rights, interests, and appurtenances of
Seller and any of its Subsidiaries pertaining thereto. The term "Film
Manufacturing Facilities" means collectively the Chippewa Facility, the
Clearfield Facility, the ▇▇▇▇▇▇ Facility, and the ▇▇▇▇▇▇▇▇▇▇ Facility.
(b) Sales Office Facilities. The entire right, title, and
interest of Seller and any of its Subsidiaries as tenant in and to (i) sales
office spaces and
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appurtenant rights located at the addresses specified in Schedule 1.03(b), and
(ii) sales office spaces and appurtenant rights, to the extent primarily used,
primarily held for use, or intended to be primarily used in the operation or
conduct of the Business, and located at ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇., ▇▇▇▇▇▇ ▇▇▇ ▇▇▇
▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇. "Sales Office Facilities" means collectively the
sales office spaces and appurtenant rights described in this Section
1.03(b)(i) and (ii).
(c) Warehouse Facilities. The entire right, title, and
interest of Seller and any of its Subsidiaries as tenant in and to warehouse
spaces and appurtenant rights, located at the addresses specified in Schedule
1.03(c). "Warehouse Facilities" means collectively the warehouse spaces and
appurtenant rights described in this Section 1.03(c).
(d) Personal Property. All machinery, equipment, computer
hardware, improvements, tools, furniture, furnishings, vehicles, and other
tangible personal property of Seller or any of its Subsidiaries that on the
Closing Date are located in or upon any of the Manufacturing Facilities, the
Office Facilities, or the Warehouse Facilities, and all other machinery,
equipment, computer hardware, improvements, tools, furniture, furnishings,
vehicles, and other tangible personal property of Seller and any of its
Subsidiaries on the Closing Date, wherever located, that are primarily used,
primarily held for use, or intended to be primarily used in the operation or
conduct of the Business (collectively, the "Personal Property").
(e) This section is reserved.
(f) Inventory. All raw materials, work-in-process, finished
goods, packaging, supplies, parts, spare parts, and other inventories of
Seller or any of its Subsidiaries that on the Closing Date are located at any
of the Manufacturing Facilities, the Office Facilities, or the Warehouse
Facilities, and all other raw materials, work-in-process, finished goods,
packaging, supplies, parts, spare parts, and other inventories of Seller and
any of its Subsidiaries (including in transit, on consignment, or in the
possession of any third party) on the Closing Date that are primarily used,
primarily held for use, or intended to be primarily used in the operation or
conduct of the Business (collectively, the "Inventory").
(g) Receivables. All accounts receivable of Seller and any
of its Subsidiaries on the Closing Date arising out of the operation or
conduct of the Business (the "Receivables").
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(h) Intellectual Property. All domestic and foreign patents
(including all reissues, divisions, continuations, and extensions thereof),
patent applications, patent rights, trademarks, trademark registrations,
trademark applications, servicemarks, trade names, business names, brand
names, copyrights, copyright registrations, designs, design registrations, and
all rights to any of the foregoing ("Intellectual Property") of Seller and any
of its Subsidiaries that are primarily used, primarily held for use, or
intended to be primarily used in the operation or conduct of the Business
(such Intellectual Property being the "Assigned Intellectual Property").
(i) Technology. All domestic and foreign trade secrets,
confidential information, inventions, engineering and production designs,
drawings, technology, know-how, formulas, processes, procedures, research,
records of inventions, test information, ideas, and other similar intangible
assets of Seller or any of its Subsidiaries that are primarily used, primarily
held for use, or intended to be primarily used in the operation or conduct of
the Business (the "Technology").
(j) Permits. All certificates, licenses, authorizations,
permits, and approvals ("Permits") issued or granted to Seller or any of its
Subsidiaries by Governmental Entities that are primarily used, primarily held
for use, or intended to be primarily used in the operation or conduct of the
Business (the "Assigned Permits").
(k) Contracts. All contracts, leases, licenses, indentures,
agreements, commitments, and all other legally binding arrangements, whether
oral or written (including purchase orders and sales orders) ("Contracts"), to
which Seller or any of its Subsidiaries is a party or by which Seller or any
of its Subsidiaries is bound that are primarily used, primarily held for use,
or intended to be primarily used in, or that arise primarily out of, the
operation or conduct of the Business (the "Assigned Contracts").
(l) Investments. All partnership interests or any other
equity interest of Seller or any of its Subsidiaries in any corporation,
company, limited liability company, partnership, joint venture, trust, or
other business association ("Investments") that are primarily used, primarily
held for use, or intended to be primarily used in, or that arise primarily out
of, the operation or conduct of the Business.
(m) Products Sold. All rights of Seller or any of its
Subsidiaries in and to products sold (including products returned after the
Closing and rights of rescission, replevin, and reclamation) in the operation
or conduct of the Business.
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(n) Prepaid Items. All credits, prepaid expenses, deferred
charges, advance payments, security deposits, and prepaid items of Seller and
any of its Subsidiaries that are primarily used, primarily held for use, or
intended to be primarily used in, or that arise primarily out of, the
operation or conduct of the Business.
(o) Claims. All rights, claims, and credits of Seller and
any of its Subsidiaries to the extent relating to any other Acquired Asset or
any Assumed Liability, including any such items arising under insurance
policies and all guarantees, warranties, indemnities, and similar rights in
favor of Seller or any of its Subsidiaries in respect of any other Acquired
Asset or any Assumed Liability.
(p) Records. All books of account, ledgers, general,
financial, accounting, and personnel records, files, invoices, customers' and
suppliers' lists, other distribution lists, billing records, sales and
promotional literature, manuals, and customer and supplier correspondence (in
all cases, in any form or medium) of Seller and any of its Subsidiaries that
are primarily used, primarily held for use, or intended to be primarily used
in, or that arise primarily out of, the conduct or operation of the Business
(the "Records").
(q) England Shares. All right, title, and interest of Seller
and any of its subsidiaries in and to shares of stock (of any class, series,
type, or designation whatsoever, including any director's qualifying shares)
of, and any other interests whatsoever in, ▇▇▇▇▇▇ Corporation Limited, a
corporation organized under the laws of England (such corporation the "England
Subsidiary" and such shares and other interests the "England Shares").
(r) Goodwill. All goodwill of Seller and any of its
Subsidiaries generated by or primarily associated with the Business.
(s) Other Assets. Other assets of Seller and any of its
Subsidiaries specified in Schedule 1.03(s).
1.04. Excluded Assets. The term "Excluded Assets" means:
(a) Executive Office Assets. All tangible personal property
of Seller and any of its Subsidiaries (other than the England Subsidiary) that
on the Closing Date is located at Seller's executive offices at ▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇, other than (i) the Records, (ii) motor vehicles, and
(iii) items specified in Schedule 1.04(a).
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(b) Pension Assets. All assets of the ▇▇▇▇▇▇ Pension Plan
(as defined in Section 5.05(b)).
(c) General Ledger. All financial and tax records relating
to the Business that form part of Seller's general ledger.
(d) Other Businesses. All assets of Seller and its
Subsidiaries (other than the England Subsidiary) that are primarily used,
primarily held for use, or intended to be primarily used by Seller or any of
its Subsidiaries in the operation or conduct of any business other than the
Business.
(e) Other Excluded Assets. Other assets of Seller or any of
its Subsidiaries specified in Schedule 1.04(e).
(f) Plicon Rights. All Receivables, Assigned Contracts,
Inventory, and Technology arising from or relating to Plicon Corporation, RP
Packaging, Inc., and/or its or their Subsidiaries or Affiliates.
(g) Cash. All cash and cash equivalents of Seller and any of
its Subsidiaries (other than the England Subsidiary).
(h) Goodwill. All goodwill that is associated with the
"▇▇▇▇▇▇" ▇▇▇▇ or any ▇▇▇▇ containing "▇▇▇" as a prefix, suffix, or otherwise.
1.05. Assumed Liabilities. Upon the terms and subject to the
conditions of this Agreement, Purchaser shall assume, effective as of the
Closing Date, and from and after the Closing Date Purchaser shall pay,
perform, and discharge when due, all Assumed Liabilities. The term "Assumed
Liabilities" means all liabilities, obligations, and commitments of Seller or
any of its Subsidiaries to the extent relating to or arising out of the
Business or any Acquired Asset, whether express or implied, liquidated,
absolute, accrued, contingent, or otherwise, and that are based upon, arise
out of, or result from any fact, circumstance, condition, act, or omission
existing on or occurring on or prior to the Closing Date, other than any
Excluded Liabilities (as defined in Section 1.06).
1.06. Excluded Liabilities. Notwithstanding Section 1.05, or any
other provision of this Agreement, and regardless of any disclosure to
Purchaser, Purchaser shall not assume any Excluded Liability, each of which
shall be retained and paid, performed, and discharged when due by Seller and
its Subsidiaries. The term "Excluded Liability" means:
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(a) Other Business. Any liability, obligation, or commitment
of Seller or any of its Subsidiaries, whether express or implied, liquidated,
absolute, accrued, contingent, or otherwise, or known or unknown, to the
extent relating to or arising out of the operation or conduct by Seller or any
of its Subsidiaries, of any business other than the Business.
(b) Excluded Assets. Any liability, obligation, or
commitment of Seller or any of its Subsidiaries to the extent relating to or
arising out of any Excluded Asset, or to the extent relating to or arising out
of the ownership by Seller or any of its Subsidiaries of the Excluded Assets
or to the extent associated with the realization of the benefits of any
Excluded Asset.
(c) Money Borrowed. Any liabilities, obligations, or
commitments of Seller or any of its Subsidiaries for money borrowed, whether
or not arising from or relating to the operation or conduct of the Business or
any of the Acquired Assets, including any liabilities, obligations, or
commitments of Seller or any of its Subsidiaries arising from or relating to
(i) the Credit Agreement, dated May 8, 1997, by and between Seller and the
Bank of Nova Scotia and certain other lenders, (ii) the Participation and
Credit Agreement, dated May 8, 1997, by and between Seller and the Bank of
Nova Scotia and certain other lenders, (iii) Seller's $175 million Senior
Notes, (iv) any indebtedness for money borrowed by Seller from Huntsman, or
(v) any loan or lease documents or other agreements related to the agreements
referred to in the foregoing clauses (i), (ii), (iii), or (iv) (the agreements
and documents referred to in clauses (i), (ii), (iii), (iv), and (v)
collectively, the "Existing Credit Facilities").
(d) Pension Liabilities. All obligations and liabilities
arising from or relating to the ▇▇▇▇▇▇ Pension Plan.
(e) This Section is reserved.
(f) Terminated Employees. Any liability, obligation, or
commitment of Seller or any of its Subsidiaries that relates to, or that
arises out of, the employment or the termination of the employment with Seller
of any employee or former employee of the Business identified in Schedule
1.06(f) (including as a result of the transactions contemplated by this
Agreement).
(g) Other Excluded Liabilities. All other liabilities,
obligations, and commitments of Seller or any of its Subsidiaries specified in
Schedule 1.06(g).
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(h) Plicon Obligations. Any liability, obligation, or
commitment of Seller or any of its Subsidiaries to the extent that it relates
to or arises out of any Receivable, Assigned Contract, or Technology arising
from or relating to Plicon Corporation, RP Packaging, Inc. and/or its or their
Subsidiaries or Affiliates.
1.07. Title to Acquired Assets. Purchaser shall acquire the Acquired
Assets free and clear of all liabilities, obligations, and commitments of
Seller and any of its Subsidiaries other than the Assumed Liabilities, and
free and clear of all liens, charges, security interests, options, claims, or
encumbrances of any nature whatsoever (collectively "Liens"), other than
Permitted Liens. "Permitted Liens" means (a) liens that primarily relate to or
arise from the operation or conduct of the Business (other than Liens that
secure any Excluded Liabilities), (b) Liens specified in Schedule 1.07, (c) in
the case of personal property, imperfections of title or encumbrances, if any,
that could not reasonably be expected to have a Material Adverse Effect (as
defined in Section 3.01) on the Business, taken as a whole, and (d) in the
case of real property: (i) easements, covenants, rights-of-way, and other
similar restrictions of record, (ii) any conditions that may be shown by a
current, accurate survey or physical inspection of the involved real property
prior to the Closing Date, and (iii) unrecorded easements, covenants,
rights-of-way, and other similar restrictions that could not reasonably be
expected to have a Material Adverse Effect on the Business, taken as a whole.
1.08. Consents of Third Parties. Notwithstanding anything in this
Agreement to the contrary, this Agreement shall not constitute an agreement to
assign any asset or any claim or right or any benefit arising under or
resulting from such asset if an attempted assignment thereof, without the
consent of a third party, would constitute a breach or other contravention of
the rights of such third party, would be ineffective with respect to any party
to an agreement concerning such asset, or would in any way adversely affect
the rights, upon transfer, of Purchaser under such asset. If any transfer or
assignment by Seller to, or any assumption by Purchaser of, any interest in,
or liability, obligation, or commitment under, any asset requires the consent
of a third party, then such assignment or assumption shall be made subject to
such consent being obtained. To the extent any Assigned Contract may not be
assigned to Purchaser by reason of the absence of any such consent, Purchaser
shall not be required to assume any Assumed Liabilities arising under such
Assigned Contract.
If any such consent is not obtained prior to the Closing, Seller and
Purchaser shall cooperate (at their own expense) in any lawful and reasonable
arrangement reasonably proposed by Purchaser under which Purchaser shall
obtain the economic claims, rights, and benefits under the asset, claim, or
right with respect to which the
8
consent has not been obtained in accordance with this Agreement. Such
reasonable arrangement may include (i) the subcontracting, sublicensing, or
subleasing to Purchaser of any and all rights of Seller against the other
party to such third-party agreement arising out of a breach or cancellation
thereof by the other party, and (ii) the enforcement by Seller of such rights.
To the extent, and only to the extent, Purchaser is able to receive the
economic claims, rights, and benefits under such asset, Purchaser shall be
responsible for the Assumed Liabilities, if any, arising under such asset.
2. THE CLOSING
2.01. Closing Date. The closing of the Acquisition (the "Closing")
shall take place at the offices of Purchaser at ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇, ▇▇▇▇ ▇▇▇▇
▇▇▇▇, ▇▇▇▇, beginning at 10:00 a.m. on September 30, 1997, or, if on such day
any condition set forth in Section 6 has not been satisfied (or, to the extent
permitted, waived by the party or parties entitled to the benefit thereof),
then as soon as practicable after all the conditions set forth in Section 6
have been satisfied (or, to the extent permitted, waived by the party or
parties entitled to the benefits thereof), or at such other place, time, and
date as may be agreed between Seller and Purchaser. The "Closing Date" means
11:59 p.m. (Eastern Time) on the date on which the Closing occurs.
2.02. Transactions to be Effected at the Closing. At the Closing:
(a) Seller Obligations. Seller shall deliver to Purchaser
(i) such appropriately executed deeds (in recordable form), bills of sale,
assignments, and other instruments of transfer relating to the Acquired Assets
in form and substance reasonably satisfactory to Purchaser and its legal
counsel, (ii) a duly executed certification of non-foreign status in the form
prescribed by Treasury Regulation ss. 1.1445-2(b)(2)(iii), and (iii) such
other documents as Purchaser or its legal counsel may reasonably request to
demonstrate satisfaction of the conditions and compliance with the covenants
set forth in this Agreement.
(b) Purchaser Obligations. Purchaser shall deliver to Seller
(i) payment, by wire transfer to a bank account designated in writing by
Seller (such designation to be made at least two business days prior to the
Closing Date), in immediately available funds in an amount equal to the
Purchase Price, (ii) such appropriately executed assumption agreements and
other instruments of assumption providing for the assumption of the Assumed
Liabilities in form and substance reasonably satisfactory to Seller and it
legal counsel, and (iii) such other documents as
9
Seller or its legal counsel may reasonably request to demonstrate satisfaction
of the conditions and compliance with the covenants set forth in this
Agreement.
2.03. Other Action. At and after the Closing, at the request of
Purchaser, Seller shall deliver such further instruments of transfer and take
all commercially reasonable action as may be necessary or appropriate (a) to
vest in Purchaser all of Seller's right, title, and interest in and to the
Acquired Assets, (b) to transfer to Purchaser (to the extent transferrable)
all licenses, agreements, and permits necessary for the operation of the
Business, and (c) to aid and assist Purchaser in collecting and reducing to
possession any or all of the Acquired Assets.
2.04. No Additional Obligations. No instrument specified in Sections
2.02 or 2.03 shall create or be deemed to create any liability or obligation
to Purchaser or Seller greater than those created by this Agreement.
2.05. Loss, Destruction, Condemnation, or Damage. If between the date
of this Agreement and the Closing Date, any of the Acquired Assets are lost,
destroyed, or condemned, or suffer any material damage, and are not repaired
or replaced prior to Closing, then Seller shall, on the Closing Date in
connection with the Closing, assign to Purchaser all insurance and/or
condemnation proceeds payable to Seller on account of such loss, destruction,
condemnation, or damage, pursuant to an assignment in form and substance
satisfactory to Purchaser and its legal counsel.
3. REPRESENTATIONS AND WARRANTIES OF SELLER
Except as specifically set forth in Schedules 3.01 through 3.17
(collectively, the "Disclosure Schedule") (with a disclosure with respect to a
Section of this Agreement to require a specific reference in the Disclosure
Schedule to the Section of this Agreement to which each such disclosure
applies, and no disclosure to be deemed to apply with respect to any Section
to which it is not expressly stated to apply), Seller hereby represents and
warrants, as of the date of this Agreement (subject to changes effected by the
Merger) and, solely with respect to matters contained in Sections 3.01, 3.02,
3.03, 3.04, 3.07, 3.08, 3.09, and 3.12 as of the Closing Date, to Purchaser as
follows:
3.01. Organization. Seller and each of its Subsidiaries is a
corporation or other entity duly organized, validly existing, and in good
standing under the laws of the jurisdiction of its incorporation or
organization (or the equivalent thereof in the case of foreign Subsidiaries),
has all requisite corporate power and authority and all necessary
10
governmental approvals to own, lease, and operate its properties and to carry
on its business (including the Business) as it is now being conducted, and is
qualified or licensed to do business as a foreign corporation and is in good
standing in each jurisdiction in which the nature of the business (including
the Business) conducted by it makes such qualification or licensing necessary,
except where the failure to be so organized, existing, and in good standing or
to have such power, authority, or governmental approvals, or to be so
qualified or licensed would not have a Material Adverse Effect (as defined
below) on Seller, or its Subsidiaries taken as a whole. Seller has previously
delivered to Purchaser a complete and correct copy of each of its Restated
Certificate of Incorporation, as amended, and its Amended and Restated Bylaws,
as currently in effect, and complete and correct copies of the certificates of
incorporation and bylaws, as currently in effect, or similar organizational
documents of all of Seller's Subsidiaries. Schedule 3.01 of the Disclosure
Schedule sets forth a complete list of Seller's Subsidiaries. For purposes of
this Agreement: (i) Any reference to any event, change, or effect having a
"Material Adverse Effect" on or with respect to any entity (or group of
entities taken as a whole) means such event, change, or effect, individually
or in the aggregate with such other events, changes, or effects, which is
materially adverse to the financial condition, businesses, results of
operations, assets, liabilities, or properties of such entity (or, if used
with respect thereto, of such group of entities taken as a whole); (ii)
"Subsidiary" means with respect to any Person, any corporation or other entity
of which more than 50% of the securities or other interests having by their
terms ordinary voting power to elect a majority of the Board of Directors or
others performing similar functions with respect to such entity is directly or
indirectly owned by such Person; and (iii) "Person" shall mean an individual,
partnership, joint venture, limited liability company, trust, corporation,
unincorporated entity, or Governmental Entity (as defined in Section 3.03).
The only Person of which Seller beneficially owns 50% of the securities or
other equity interests is Orrex Plastics Company LLC ("Orrex"). Orrex does not
own, lease, possess, or have any interest in any of the Acquired Assets.
Schedule 3.01 sets forth a list of all Orrex charter or governance agreements
and related documents.
3.02. Authorization and Validity of Agreement. Seller has the
requisite corporate power and authority to execute and deliver this Agreement
and to consummate the transactions contemplated hereby. The execution and
delivery by Seller of this Agreement and the consummation of the transactions
contemplated hereby have been duly authorized by the Board of Directors of
Seller and no other corporate proceedings on the part of Seller are necessary
to authorize the execution and delivery of this Agreement by Seller and the
consummation of the transactions contemplated hereby. This Agreement has been
duly executed and delivered by Seller and, assuming due
11
authorization, execution, and delivery of this Agreement by Purchaser, this
Agreement is a valid and binding obligation of Seller enforceable against
Seller in accordance with its terms, except that such enforcement may be
subject to or limited by (i) bankruptcy, insolvency, or other similar laws,
now or hereafter in effect, affecting creditors' rights generally, and (ii)
the effect of general principles of equity (regardless of whether
enforceability is considered in a proceeding at law or in equity).
3.03. No Violations; Consents and Approvals. Except as set forth in
Schedule 3.03, neither the execution and delivery of this Agreement by Seller
nor the consummation by Seller of the transactions contemplated hereby will
(i) conflict with or violate any provision of the Restated Certificate of
Incorporation or Amended and Restated Bylaws of Seller, or the certificates of
incorporation or bylaws or similar organizational documents of any of Seller's
Subsidiaries, (ii) require any filing with, or permit, authorization, consent,
or approval of, any court, arbitral tribunal, administrative agency, or
commission or other governmental or other regulatory authority, agency, or
official (a "Governmental Entity"), (iii) assuming the accuracy of the
representations and warranties of, and performance of the covenants by
Purchaser as set forth herein, result in a violation or breach of, or
constitute (with or without due notice or lapse of time or both) a default (or
give rise to any right of termination, amendment, cancellation, or
acceleration), or require any consent under, any of the terms, conditions, or
provisions of any note, bond, mortgage, indenture, guarantee, other evidence
of indebtedness, lease, license, contract, agreement, or other instrument or
obligation to which Seller or any of its Subsidiaries is a party or by which
any of them or any of their assets may be bound ("Seller Agreements") or
result in the imposition or creation of any Lien on the assets of Seller or
any of its Subsidiaries or (iv) violate any order, writ, injunction, decree,
statute, rule, or regulation applicable to Seller or any of its Subsidiaries
or any of their properties or assets; except in the case of clauses (ii),
(iii), or (iv), (A) where the failure to obtain such permits, authorizations,
consents, or approvals or to make such filings would not have a Material
Adverse Effect on Seller and its Subsidiaries, taken as a whole, or (B) for
such violations, breaches, or defaults which would not have a Material Adverse
Effect on Seller and its Subsidiaries, taken as a whole.
3.04. Subsidiary Capitalization. Except as set forth in Schedule 3.04
all of the outstanding shares of capital stock of the England Corporation are
beneficially owned by the Company, directly or indirectly, except for any
directors' qualifying shares, and all such shares have been validly issued and
are fully paid and nonassessable and are owned by either the Company or one of
its Subsidiaries free and clear of all Liens. Except as set forth in Schedule
3.04, there are no voting trusts or other agreements or understandings to
which the Company or any of its Subsidiaries is a party with respect
12
to the voting trusts or other agreements or understandings to which the
Company or any of its Subsidiaries is a party with respect to the voting of
the capital stock of the England Company.
3.05. SEC Reports and Financial Statements. Seller has filed with the
Securities and Exchange Commission (the "SEC"), and has heretofore made
available to Purchaser (directly or indirectly) true and complete copies of,
all forms and documents required to be filed by Seller since January 1, 1994,
under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), or
the Securities Act of 1933, as amended (the "Securities Act") (as such
documents have been amended since the time of their filing, collectively, the
"Company SEC Documents"). As of their respective dates (or, if amended, as of
the date of the last such amendment), the Company SEC Documents, including any
financial statements or schedules included therein (i) did not contain any
untrue statement of a material fact or omit to state a material fact required
to be stated therein or necessary in order to make the statements therein, in
light of the circumstances under which they were made, not misleading and (ii)
complied in all material respects with the applicable requirements of the
Exchange Act and the Securities Act, as the case may be, and the applicable
rules and regulations of the SEC thereunder. The consolidated financial
statements included in the Company SEC Documents (i) have been prepared from,
and are in accordance with, the books and records of Seller and its
consolidated Subsidiaries, (ii) have been prepared in accordance with United
States generally accepted accounting principles ("GAAP") applied on a
consistent basis during the periods involved (except as otherwise noted
therein and except that the quarterly financial statements are subject to year
end adjustments and do not contain all footnote disclosures required by GAAP),
(iii) comply in all material respects with applicable accounting requirements
and with the published rules and regulations of the SEC with respect thereto,
and (iv) fairly present in all material respects the consolidated financial
position and the consolidated results of operations and cash flows of Seller
and its consolidated Subsidiaries as at the dates thereof or for the periods
presented therein. No Subsidiary of Seller is required to file any reports,
forms, or other documents with the SEC.
3.06. Absence of Certain Changes. Except as disclosed in the Company
SEC Documents filed prior to the date of this Agreement or as disclosed in
Schedule 3.06, since December 31, 1996, Seller and its Subsidiaries have
conducted their respective businesses and operations (including the Business)
only in the ordinary course and consistent with past practice, and there have
not occurred (i) any events or changes (including the incurrence of any
liabilities of any nature, whether or not accrued, contingent, or otherwise)
having or which would have a Material Adverse Effect on
13
Seller and its Subsidiaries, taken as a whole; (ii) except for the payment of
regular quarterly cash dividends consistent with past practice, any
declaration, setting aside, or payment of any dividend or other distribution
(whether in cash, stock, or property) with respect to the equity interests of
Seller or any of its Subsidiaries; or (iii) any change by Seller or any of its
Subsidiaries in accounting principles or methods, except insofar as may be
required by a change in GAAP. Except as disclosed in the Company SEC Documents
filed prior to the date of this Agreement or in Schedule 3.06, since December
31, 1996, neither Seller nor any of its Subsidiaries has taken any of the
actions prohibited by Section 5.1 of the Merger Agreement. For purposes of
this Agreement, "knowledge of the Seller" shall mean the actual knowledge of
the individuals specified in Schedule 3.06.
3.07. No Undisclosed Liabilities. Except as disclosed in the Company
SEC Documents filed prior to the date of this Agreement or in Schedule 3.07
and except for liabilities and obligations incurred in the ordinary course of
business and consistent with past practice since December 31, 1996, neither
Seller nor any of its Subsidiaries have incurred any liabilities or
obligations of any nature, whether or not accrued, contingent, or otherwise,
that have, or would have, a Material Adverse Effect on Seller and its
Subsidiaries, taken as a whole, or would be required to be reflected or
reserved against in the consolidated financial statements of Seller and its
Subsidiaries (including notes thereto) prepared in accordance with GAAP.
3.08. Employee Benefit Plans and ERISA.
(a) ERISA and Plans. Schedule 3.08 contains a true and
complete list of each bonus, deferred compensation, incentive compensation,
stock purchase, stock option, severance or termination pay, hospitalization,
or other medical, life, or other insurance, supplemental unemployment
benefits, profit-sharing, pension, or retirement plan, program, or agreement
and each other employee benefit plan within the meaning of Section 3(3) of
ERISA, sponsored, maintained, or contributed to by Seller or by any trade or
business, whether or not incorporated (an "ERISA Affiliate"), that together
with Seller would be deemed a "single employer" within the meaning of section
4001 of the Employee Retirement Income Security Act of 1974, as amended
("ERISA"), for the benefit of any employee or former employee of Seller or any
ERISA Affiliate (the "Plans"). Schedule 3.08 identifies each of the Plans that
is an "employee benefit plan," as defined in section 3(3) of ERISA (the "ERISA
Plans").
14
(b) Plan Documents. With respect to each Plan, Seller has
heretofore delivered or made available to Purchaser, true and complete copies
of each of the following documents:
(i) the Plan;
(ii) the most recent annual report and actuarial
report, if required under ERISA;
(iii) the most recent Summary Plan Description (as
defined in ERISA) required under ERISA with respect thereto;
(iv) if the Plan is funded through a trust or any
third party funding vehicle, the trust or other funding agreement and
the latest financial statements thereof; and
(v) the most recent determination letter received
from the Internal Revenue Service with respect to each Plan intended
to qualify under section 401(a) of the Code.
(c) No Liabilities. No liability under Title IV of ERISA has
been incurred by Seller or any ERISA Affiliate that has not been satisfied or
otherwise discharged in full, and no condition exists that presents a material
risk to Seller or any ERISA Affiliate of incurring a liability under such
Title, other than liability for contributions due in the ordinary course and
premiums due the Pension Benefit Guaranty Corporation ("PBGC") (which
contributions and premiums have bene paid when due).
(d) No Multiemployer Plans. No ERISA Plan is a
"multiemployer pension plan," as defined in section 3(37) of ERISA, nor is any
ERISA Plan a plan described in section 4063(a) of ERISA.
(e) Qualifications. No ERISA Plan or any trust established
thereunder has incurred any "accumulated funding deficiency" (as defined in
section 302 of ERISA and section 412 of the Code), whether or not waived, as
of the last day of the most recent fiscal year of each ERISA Plan ended prior
to the Closing Date. No Lien imposed under the Code or ERISA exists or is
likely to be imposed on account of any ERISA Plan. The form of each ERISA Plan
intended to be "qualified" within the meaning of section 401(a) of the Code
has been determined by the Internal Revenue
15
Service to be so qualified (or timely application has been made therefor); no
event has occurred since the date of such determination that would adversely
affect such qualification for which the cost of correction would have a
Material Adverse Effect on Seller and its Subsidiaries taken as a whole; and
each trust maintained thereunder has been determined by the Internal Revenue
Service to be exempt from taxation under section 501(a) of the Internal
Revenue Code of 1986, as amended (the "Code"). Each Plan has been operated and
administered in accordance with its terms and applicable law, including but
not limited to ERISA and the Code, except for such non-compliance that would
not have a Material Adverse Effect on Seller and its Subsidiaries taken as a
whole.
(f) No Claims. There are no pending, threatened, or
anticipated claims (other than routine claims for benefits) by, on behalf of,
or against, any of the Plans or any trusts related thereto that if determined
adversely to Seller and its Subsidiaries would have a Material Adverse Effect
on Seller and its Subsidiaries taken as a whole.
(g) No Proceedings. The PBGC has not instituted proceedings
to terminate any of the ERISA Plans and no condition exists that presents a
material risk that such proceedings will be instituted.
(h) Deficiency. As of December 31, 1996, the present value
of all actuarial accrued benefit liabilities under the Seller's defined
benefit plans subject to Title IV of ERISA, as determined by the actuary of
such plans using the actuarial assumptions and methods described in the
actuarial valuation as of January 1, 1996, did not exceed the market value of
the assets of such plans by more than $1,500,000.
(i) Prohibited Transactions. Neither Seller, any ERISA
Affiliate, any of the ERISA Plans, any trust created thereunder, nor any
trustee or administrator thereof has engaged in a transaction or has taken or
failed to take any action in connection with which Seller, any ERISA
Affiliate, any of the ERISA Plans, any such trust, any trustee or
administrator thereof, or any party dealing with the ERISA Plans or any such
trust could be subject to either a civil penalty assessed pursuant to section
409 or 502(i) of ERISA or a tax imposed pursuant to section 4975, 4976, or
4980B of the Code that would have a Material Adverse Effect on Seller and its
Subsidiaries taken as a whole.
(j) Taxes. Except as disclosed in Schedule 3.08, no amounts
payable under the Plans or any other agreement or arrangement to which Seller
is a party will,
16
as a result of the Merger, fail to be deductible for federal income tax
purposes by virtue of section 280G of the Code.
(k) Benefits. Except as disclosed in Schedule 3.08, no ERISA
Plan provides benefits, including without limitation death or medical benefits
(whether or not insured), with respect to current or former employees after
retirement or other termination of employment (other than (i) coverage
mandated by applicable law, (ii) disability, death, or retirement benefits
under any "employee pension plan," as that term is defined in section 3(2) of
ERISA, (iii) deferred compensation benefits or severance benefits accrued as
liabilities on the books of Seller or the ERISA Affiliates, (iv) severance
pay, disability benefits, and benefit claims under ERISA Plans incurred on or
prior to a termination of employment but not reported or paid until after such
termination, or (v) benefits, the full cost of which is borne by the current
or former employee (or his beneficiary)).
3.09. Litigation and Compliance with Law.
(a) No Litigation. Except as disclosed in the Company SEC
Documents filed prior to the date of this Agreement or in Schedule 3.09, there
is no suit, claim, action, proceeding, or investigation pending or, to the
knowledge of Seller, threatened, against or affecting Seller, or any of its
Subsidiaries or any of their respective properties which, if determined
adversely to Seller or such Subsidiaries, would have a Material Adverse Effect
on Seller and its Subsidiaries taken as a whole or would prevent or delay
Seller from consummating the Merger or the transactions contemplated by this
Agreement.
(b) Compliance. Except as disclosed in the Company SEC
Documents filed prior to the date of this Agreement or in Schedule 3.09,
Seller and its Subsidiaries are in compliance in all material respects with
all laws, statutes, regulations, rules, ordinances, judgments, decrees,
orders, writs, and injunctions, of any court or Governmental Entity relating
to any of the property owned, leased, or used by them, or applicable to their
business (including the Business), including employment and employment
practices, labor relations, occupational safety and health, environmental,
tax, interstate commerce, and antitrust laws, except for such non-compliance
which would not have a Material Adverse Effect on Seller and its Subsidiaries
taken as a whole. Except as set forth in the Company SEC Documents filed prior
to the date of this Agreement, neither Seller nor any of its Subsidiaries nor
any of their respective properties is subject to any judgment, decree, order,
writ, or injunction having, or which would have, a Material Adverse Effect on
Seller and its Subsidiaries
17
taken as a whole, or which would prevent or delay the consummation of the
Merger or the transactions contemplated by this Agreement.
(c) Permits. Seller and its Subsidiaries hold all licenses,
permits, variances, and approvals of Governmental Entities necessary for the
lawful conduct of their respective businesses (including the Business) as
currently conducted except where the failure to hold such licenses, permits,
variances, or approvals would not have a Material Adverse Effect on Seller and
it Subsidiaries taken as a whole.
3.10. ▇▇▇▇▇▇ Intellectual Property. Except as disclosed in the
Company SEC Documents filed prior to the date of this Agreement or in Schedule
3.10, to the knowledge of Seller, Seller and its Subsidiaries own or possess
adequate licenses or other valid rights to use or operate within the scope of
all United States and foreign patents, trademarks, trade names, copyrights,
service marks, all applications therefor and registrations thereof,
confidential or proprietary technical and business information, know-how and
trade secrets, and computer software (collectively, "▇▇▇▇▇▇ Intellectual
Property") which are material to the operations of Seller and its
Subsidiaries, taken as a whole, as currently conducted. Except as disclosed in
the Company SEC Documents filed prior to the date of this Agreement or in
Schedule 3.10, such ▇▇▇▇▇▇ Intellectual Property that is owned by Seller or
its Subsidiaries is not subject to any Liens except for such Liens that would
not have a Material Adverse Effect on Seller or its Subsidiaries, and, to the
knowledge of Seller, there are no infringements or other violations or
conflicts with the rights of others with respect to the (a) use of or other
conduct by Seller or its Subsidiaries within the scope of, (b) ownership of,
(c) validity of, or (d) enforceability of, any ▇▇▇▇▇▇ Intellectual Property
owned by Seller or its Subsidiaries that has or would have a Material Adverse
Effect on Seller and its Subsidiaries taken as a whole.
3.11. Seller Agreements. Each Seller Agreement that is material to
the consolidated business and operations of Seller and its Subsidiaries as
currently conducted or that is listed on Schedule 3.11 (collectively, the
"Material Seller Agreements") is a valid, binding, and enforceable obligation
of Seller or the Subsidiary of Seller that is a party thereto, except where
the failure to be valid, binding, and enforceable would not have a Material
Adverse Effect on Seller and its Subsidiaries taken as a whole, and there are
no defaults thereunder on the part of Seller or its Subsidiary (which is a
party thereto, as the case may be), or, to the knowledge of Seller, on the
part of the other party thereto), except those defaults that would not have a
Material Adverse Effect on Seller and its Subsidiaries taken as a whole.
Except as disclosed in Schedule 3.11, neither Seller nor any of its
Subsidiaries is a party to any
18
technology license agreement or sales agency or distributorship agreement that
limits in any material manner the ability of Seller or any of its Subsidiaries
to compete in or conduct any significant line of business or compete with any
Person or in any geographic area or during any period of time exceeding one
year from the date of the Merger Agreement.
3.12. Taxes. Except as set forth in Schedule 3.12:
(a) Tax Returns. Seller and its Subsidiaries have (i) filed
(or there have been filed on their behalf) with the appropriate Governmental
Entity all material Tax Returns (as hereinafter defined) required to be filed
by them and such Tax Returns are true, correct, and complete in all material
respects, (ii) maintained in all material respects all required records with
respect to all material Tax Returns, (iii) paid in full (or there has been
paid on their behalf) all material Taxes (as hereinafter defined) that are due
and payable for all taxable periods and portions thereof except to the extent
of reserves established in accordance with GAAP on the consolidated financial
statements included in the Company SEC Documents, and (iv) made provision, in
accordance with GAAP, for all future material Tax liabilities (including
reserves for deferred Taxes established in accordance with GAAP and for all
contingent Tax liabilities) for all taxable periods and portions thereof.
(b) Audits. No federal, state, local, or foreign audits or
other administrative proceedings ("Audits") or court proceedings are presently
pending with regard to any Taxes or Tax Returns of Seller or its Subsidiaries,
and none of Seller or its Subsidiaries has received written notice of either
the commencement of any such Audits or of the intention on the part of any
Governmental Entity to commence any such Audits.
(c) Deficiencies. No Governmental Entity has asserted in
writing against Seller or any of its Subsidiaries any material deficiency for
any Taxes which have not been satisfied in full or adequately reserved for in
accordance with GAAP on the consolidated financial statements included in the
Company SEC Documents.
(d) Liens. There are no Liens for Taxes upon any property or
assets of Seller or any of its Subsidiaries (except for current Taxes that are
not yet due and payable).
(e) Settlement. The income Tax Returns of or including
Seller and each of its Subsidiaries have been examined by and settled with the
appropriate
19
Governmental Entity (or the applicable statutes of limitation for the
assessment of income Taxes for such periods have expired) for all periods
through and including December 31, 1992.
(f) Waivers. None of Seller or its Subsidiaries has waived
any statute of limitation with respect to Taxes (which waiver is currently in
effect) or has agreed to any extension of time with respect to a Tax
assessment or deficiency (which has not yet been paid) or has extended the
time to file any income or other material Tax Return (which Tax Return has not
subsequently been filed).
(g) Joint Taxes. None of Seller or its Subsidiaries is a
party to any income tax allocation, tax indemnity, or tax sharing agreement or
arrangement, nor has any of Seller or its Subsidiaries ever joined in the
filing of a consolidated, combined, unitary, or other group Tax Return with
any corporation other than Seller and its Subsidiaries. None of Seller or its
Subsidiaries could have any liability for Taxes of any other corporation,
person, or entity (other than Seller and its Subsidiaries) under Treasury
Regulation section 1.1502-6 (or any similar provision of state, local, or
foreign law), by contract or otherwise, that, individually or in the
aggregate, would have a Material Adverse Effect on Seller and its Subsidiaries
taken as a whole.
(h) Compliance. Seller and its Subsidiaries have complied in
all material respects with all applicable laws, rules, and regulations
relating to the payment and withholding of Taxes and, except to the extent of
any reserves established in accordance with GAAP on the consolidated financial
statements included in the Company SEC Documents, have, within the time and
manner prescribed by law, withheld and paid over to the proper Governmental
Entity all amounts required to be withheld and paid over under all applicable
laws.
(i) U. S. Property. None of the Subsidiaries of Seller have
an investment in "United States property" within the meaning of section 956 of
the Code.
(j) Definitions. (i) For purposes of this Section 3.12 the
term "Subsidiaries" shall include any entity in which Seller or a Subsidiary
of Seller is a general partner. (ii) For purposes of this Agreement: (x)
"Taxes" shall mean any and all taxes, charges, fees, levies, or other
assessments, including all net income, gross income, gross receipts, excise,
stamp, real or personal property, ad valorem, withholding, estimated, social
security, unemployment, occupation, use, service, service use, license, net
worth, payroll, franchise, severance, transfer, recording, or other taxes,
assessments, or charges imposed by any Governmental Entity and any interest,
20
penalties, or additions to tax attributable thereto; and (y) "Tax Return"
shall mean any return, report, or similar statement required to be filed with
respect to any Tax (including any attached schedules), including any
information return, claim for refund, amended return, or declaration of
estimated Tax.
3.13. Environmental Matters.
(a) Compliance. Except as disclosed in the Company SEC
Documents filed prior to the date of this Agreement or as disclosed in
Schedule 3.13, Seller and its Subsidiaries are and have been in compliance in
all material respects with all applicable Environmental Laws (as hereinafter
defined) which compliance includes (i) the possession of material permits,
licenses, registrations, and other governmental authorizations and financial
assurances required under applicable Environmental Laws for Seller and its
Subsidiaries to operate their businesses (including the Business) as currently
conducted, and (ii) compliance with the terms and conditions thereof, except
in all cases above where such noncompliance would not have a Material Adverse
Effect on Seller and its Subsidiaries taken as a whole.
(b) Claims. Except as disclosed in the Company SEC Documents
filed prior to the date of this Agreement or as disclosed in Schedule 3.13,
(i) there are no Environmental Claims (as hereinafter defined) pending or, to
the knowledge of Seller, threatened, against Seller or its Subsidiaries that
would result in a Material Adverse Effect on Seller and its Subsidiaries taken
as a whole, (ii) neither Seller nor its Subsidiaries has received any written
request for information under any Environmental Law from any Governmental
Entity with respect to any actual or alleged environmental contamination which
has not been remediated or otherwise resolved and the remediation of which
contamination or the resolution of the request would have a Material Adverse
Effect on Seller and its Subsidiaries taken as a whole; and (iii) none of
Seller, its Subsidiaries, or, to the knowledge of Seller, any Governmental
Entity, is conducting or has conducted (or, to the knowledge of Seller, is
threatening to conduct) any environmental remediation or investigation which
would result in a Material Adverse Effect on Seller and its Subsidiaries,
taken as a whole, under any Environmental Law.
(c) Other Substances. Except as disclosed in the Company SEC
Documents filed prior to the date of this Agreement or as disclosed in
Schedule 3.13, (i) to the knowledge of Seller, there is no friable
asbestos-containing material in or on any real property currently owned,
leased, or operated by Seller or its Subsidiaries, (ii) there are no
polychlorinated diphenyls in any equipment currently owned, leased, or
operated by Seller or any of its Subsidiaries as a manufacturing facility, and
(iii) there
21
are and, to the knowledge of Seller, have been no underground storage tanks
(whether or not required to be registered under any applicable law), dumps,
landfills, lagoons, surface impoundments, injection ▇▇▇▇▇, or other land
disposal units in or on any property currently or, to the knowledge of Seller,
formerly owned, leased, or operated by Seller or its Subsidiaries where in
each case, the presence, ownership, or operation of which would result in a
Material Adverse Effect on Seller and its Subsidiaries, taken as a whole.
(d) No Releases. Except as disclosed in the Company SEC
Documents filed prior to the date of this Agreement or as disclosed in
Schedule 3.13, to the knowledge of Seller, there have been no Releases (as
hereinafter defined) of Hazardous Substances (as hereinafter defined) at any
of Seller's or its Subsidiaries' properties or of Hazardous Substances which
were generated, stored, disposed of, or transported by Seller, which could
form the basis of any Environmental Claim against Seller, or to the knowledge
of Seller, against any person or entity whose liability for any Releases
Seller has or may have retained or assumed either contractually or by
operation of law, which would have a Material Adverse Effect on Seller and its
Subsidiaries taken as a whole.
(e) Definitions. As used in this Agreement:
(i) The term "Environmental Claim" means any claim,
action, investigation, or written notice to Seller or its
Subsidiaries by any person or entity alleging potential liability or
responsibility of Seller or any of its Subsidiaries (including
potential liability for investigatory costs, cleanup costs,
governmental response costs, natural resource damages, personal
injuries, or penalties) arising out of, based on, or resulting from
(A) the presence, or release into the environment, of any Hazardous
Substance (as hereinafter defined) at any location, whether or not
owned or operated by Seller or its Subsidiaries or (B) circumstances
forming the basis of any violation or alleged violation of any
applicable Environmental Law.
(ii) The term "Environmental Laws" means all
federal, state, local, and foreign laws, rules, regulations, common
law, ordinances, decrees, orders, and other binding legal
requirements, as in effect as of the date of the Merger Agreement,
relating to pollution or protection of the environment, including
laws and regulations relating to emissions, discharges, releases, or
threatened releases of Hazardous Substances, or otherwise relating to
the
22
manufacture, processing, distribution, use, treatment, storage,
disposal, transport, or handling of Hazardous Substances.
(iii) The term "Hazardous Substance" means any
chemicals, pollutants, contaminants, hazardous wastes, toxic
substances, or radioactive materials regulated under any
Environmental Law, and oil and petroleum products.
(iv) The term "Release" means any release, spill,
emission, discharge, leaking, pumping, injection, deposit, disposal,
dispersal, leaching, or migration into the indoor or outdoor
environment (including ambient air, surface water, groundwater, and
surface or subsurface strata).
3.14. No Default. Except as disclosed in the Company SEC Documents
filed prior to the date of this Agreement or as disclosed in Schedule 3.14,
the business (including the Business) of Seller and each of its Subsidiaries
is not being conducted in default or violation of any term, condition, or
provision of (a) its respective certificate of incorporation or bylaws or
similar organizational documents, (b) any Material Seller Agreement, or (c)
any federal, state, local, or foreign law, statute, regulation, rule,
ordinance, judgment, decree, writ, injunction, franchise, permit, or license
or other governmental authorization or approval applicable to Seller or any of
its Subsidiaries, excluding from the foregoing clauses (b) or (c), defaults or
violations that would not have a Material Adverse Effect on Seller and its
Subsidiaries taken as a whole or would not materially impair the ability of
(i) Seller to consummate the Merger or (ii) Seller to consummate the
transactions contemplated by this Agreement.
3.15. Brokers. Except for ▇▇▇▇▇▇▇▇ Wretheim and ▇▇▇▇▇ ▇▇▇▇▇▇ (true
and complete copies of whose engagement letters have been provided to
Purchaser, directly or indirectly, no broker, finder, or investment banker is
entitled to any brokerage, finder's, or other fee or commission in connection
with the transactions contemplated by this Agreement based upon arrangements
made by or on behalf of Seller.
3.16. Property. Seller and its Subsidiaries, as the case may be, have
good and valid title to or, in the case of leased property, have valid
leasehold interests in all properties and assets necessary to conduct the
business (including the Business) of Seller as currently conducted, except to
the extent the failure of this representation and warranty to be true would
not have a Material Adverse Effect on Seller and its Subsidiaries, taken as a
whole.
23
3.17. Labor Matters. Except as disclosed in the Company SEC Documents
filed prior to the date of this Agreement, neither Seller nor any of its
Subsidiaries is a party to or bound by any collective bargaining agreement or
other labor union contract applicable to persons employed by Seller or its
Subsidiaries nor, to the knowledge of Seller, as of the date of this
Agreement, are there any activities or proceedings of any labor union to
organize any such employees. Except as disclosed in the Company SEC Documents
filed prior to the date of this Agreement or as disclosed in Schedule 3.17, as
of the date of this Agreement, (i) there are no unfair labor practice charges
or complaints pending against Seller or any of its Subsidiaries before the
National Labor Relations Board or any current union representation questions
involving employees of Seller or any of its Subsidiaries and (ii) there is no
labor strike, lockout, organized slowdown, or organized work stoppage in
effect or, to the knowledge of Seller, threatened against Seller or any of its
Subsidiaries, which, in either such case, has had or would have, a Material
Adverse Effect on Seller and its Subsidiaries taken as a whole.
4. REPRESENTATIONS AND WARRANTIES OF PURCHASER
Purchaser hereby represents and warrants, as of the date hereof and
as of the Closing Date, to Seller as follows:
4.01. Organization. Purchaser is a corporation duly organized,
validly existing, and in good standing under the laws of Utah. Purchaser has
all requisite corporate power and authority to own, lease, and operate its
properties and to carry on its business as now being conducted except where
the failure to have such power or authority would not have a Material Adverse
Effect on Purchaser, taken as a whole, or materially impair or delay the
consummation of the transactions contemplated by this Agreement.
4.02. Authorization and Validity of Agreement. Purchaser has the
requisite corporate power and authority to execute and deliver this Agreement
and to consummate the transactions contemplated hereby. The execution and
delivery by Purchaser of this Agreement and the consummation of the
transactions contemplated hereby have been duly authorized by its Board of
Directors and no other corporate proceedings on the part of Purchaser are
necessary to authorize the execution and delivery of this Agreement by
Purchaser and the consummation of the transactions contemplated hereby. This
Agreement has been duly executed and delivered by Purchaser. Assuming due
authorization, execution, and delivery of this Agreement by Seller, this
Agreement is a valid and binding obligation of Purchaser, enforceable against
Purchaser in accordance with its terms, except that such enforcement may be
subject to or limited by (i) bankruptcy, insolvency, or other similar laws,
now or hereafter in effect, affecting
24
creditors' rights generally, and (ii) the effect of general principles of
equity (regardless of whether enforceability is considered in a proceeding at
law or in equity).
4.03. No Violations; Consents and Approvals. Except as disclosed in
Schedule 4.03, no filing with, and no permit, authorization, consent, or
approval of, any Governmental Entity is necessary for the consummation by
Purchaser of the transactions contemplated by this Agreement. Neither the
execution and delivery of this Agreement by Purchaser nor the consummation by
Purchaser of the transactions contemplated hereby nor compliance by Purchaser
with any of the provisions hereof will (a) conflict with or violate any
provision of the Articles of Incorporation or Bylaws of Purchaser, or (b)
violate any order, writ, injunction, decree, statute, rule, or regulation
applicable to Purchaser or any of its properties or assets, except in the case
of clause (b) where such violations would not have a Material Adverse Effect
on Purchaser, taken as a whole.
5. COVENANTS
5.01. Plicon Collection. Seller covenants and agrees that, after the
Closing Date, it will (a) use reasonable efforts to collect from Plicon
Corporation, RP Packaging, and/or any of its or their Subsidiaries or
Affiliates (collectively, the "Plicon Group") any indebtedness or other amount
owed as of the Closing Date by any member of the Plicon Group to Seller, and
(b) remit promptly to Purchaser all sums collected by Seller after the Closing
Date with respect to such indebtedness and other obligations (less any
expenses and other obligations or liabilities incurred by Seller in connection
with such collection).
5.02. Access to Information.
(a) Access. From the date of this Agreement until the
Closing Date, Seller shall afford to Purchaser and the Purchaser's officers,
directors, employees, representatives, and agents (including investment
bankers, attorneys, and accountants) (collectively, "Representatives")
reasonable access (during normal business hours) to all of Seller's, and
Seller's Subsidiaries', books, records, files, documents, and Company
Agreements relating to the Business and, during such period, Seller and each
of Seller's Subsidiaries shall furnish promptly to Purchaser such other
information including copies of books, records, files, documents, and Seller
Agreements, concerning the Business and all related properties and personnel
as Purchaser may request; provided, that Purchaser and Purchaser's
Representatives will conduct all such inspections in a reasonable manner.
Seller and Seller' Subsidiaries shall provide Purchaser and Purchaser's
Representatives with reasonable access during normal business hours to
Seller's officers
25
and senior operating personnel (collectively, the "Business Executives") and
such Business Executives shall reasonably cooperate with Purchaser and
Purchaser's Representatives and provide Purchaser and Purchaser's
Representatives with such information regarding the Business, the Acquired
Assets, and the Assumed Liabilities as may be reasonably requested. Seller
shall in addition use its reasonable efforts to provide Purchaser and
Purchaser's Representatives with access to the Representatives, commercial
bankers, actuaries, trustees, outside Plan administrators, and consultants of
Seller and Seller's Subsidiaries and to use its best efforts to cause such
Representatives, commercial bankers, actuaries, trustees, outside Plan
administrators and consultants to provide Purchaser and Purchaser's
Representatives with such information regarding the Business, the Acquired
Assets, and the Assumed Liabilities as may be reasonably requested.
(b) Seller Confidentiality. For a period of three years
after the Closing Date, Seller shall keep confidential, and cause its
Affiliates and its and their respective Representatives to keep confidential,
all information relating to the Business, except as required by law or
administrative process and except for information that is available to the
public on the Closing Date, or thereafter becomes available to the public
other than as a result of a breach of this Section 5.02(b).
5.03. Further Action; Reasonable Best Efforts.
(a) Pre-Closing Action. Upon the terms and subject to the
conditions herein provided, each of the parties hereto agrees to use its
reasonable best efforts to take, or cause to be taken, all action and to do,
or cause to be done, all things necessary under applicable laws and
regulations to consummate and make effective the transactions contemplated by
this Agreement, including (i) to comply promptly with all legal requirements
which may be imposed on it with respect to this Agreement and the transactions
contemplated hereby (which actions shall include furnishing all information
required by applicable law in connection with approvals of or filings with any
Governmental Entity), (ii) to satisfy the conditions precedent to the
obligations of such party hereto, (iii) to obtain any consent, authorization,
order, or approval of, or any exemption by, any Governmental Entity or other
public or private third party required to be obtained or made by Seller,
Purchaser, or any of their respective Subsidiaries in connection with the
Acquisition or the taking of any action contemplated by this Agreement, (iv)
to effect all necessary registrations and filings, and (v) to take any action
reasonably necessary to vigorously defend, lift, mitigate, or rescind the
effect of any litigation or administrative proceeding adversely affecting the
Acquisition or this Agreement, including promptly appealing any adverse court
or administrative decision.
26
(b) Information. Subject to appropriate confidentiality
protections, each of the parties hereto will furnish to the other parties such
necessary information and reasonable assistance as such other parties may
reasonably request in connection with the foregoing and will provide the other
parties with copies of all filings made by such party with any Governmental
Entity and, upon request, any other information supplied by such party to a
Governmental Entity in connection with this Agreement and the transactions
contemplated hereby. Upon the terms and subject to the conditions herein
provided, in case at any time after the Closing Date any further action is
necessary or desirable to carry out the purposes of this Agreement, the proper
officers and/or directors of the parties shall use their reasonable best
efforts to take or cause to be taken all such necessary action.
5.04. Post-Closing Cooperation.
(a) Transition. Purchaser and Seller shall cooperate with
each other, and shall cause their respective Representatives to cooperate with
each other, after the Closing to ensure the orderly transition of the Business
from Seller to Purchaser and to minimize any disruption to the Business and
the other respective businesses of Seller and Purchaser that might result from
the transactions contemplated hereby. After the Closing, upon reasonable
written notice, Purchaser and Seller shall furnish or cause to be furnished to
each other and their respective Representatives access, during normal business
hours, to such information and assistance relating to the Business (to the
extent within the control of such party) as is reasonably necessary for
financial reporting and accounting and other matters, including defense of
claims, disputes, or litigation.
(b) Information and Assistance. After the Closing, upon
reasonable written notice, Purchaser and Seller shall furnish or cause to be
furnished to each other, as promptly as practicable, such information and
assistance (to the extent within the control of such party) relating to the
Business or Acquired Assets (including access to books and records) as is
reasonably necessary for the filing of all Tax returns, and making of any
election related to Taxes, the preparation for any Audit by any Governmental
Entity, and the prosecution or defense of any claim, suit, or proceeding
related to any Tax Return. Seller and Purchaser shall cooperate with each
other in the conduct of any Audit or other proceeding relating to Taxes
involving the Business. Purchaser shall retain the books and records of Seller
included in the Acquired Assets for a period of seven years after the Closing.
After the end of such seven-year period, before disposing of such books or
records, Purchaser shall give notice to such effect to Seller and give Seller,
at Seller's cost and expense, an opportunity to remove and retain all or any
part of such books or records as Seller may select.
27
(c) Copies. After the Closing Date, (i) Purchaser shall
promptly provide to Seller copies of any of the Records included in the
Acquired Assets requested from time to time by Seller, and (ii) Seller shall
promptly provide to Purchaser copies of any books of account, ledgers,
general, financial, accounting, and personnel records, files, invoices,
customers' and suppliers' lists, other distribution lists, billing records,
sales and promotional literature, manuals, and customer and supplier
correspondence that (A) prior to the Closing Date was used, held for use, or
intended to be used in, or arose out of, the conduct or operation of the
Business, but (B) is not part of the Records included in the Acquired Assets
(including financial and tax records relating to the Business that are part of
Seller's general ledger).
5.05. Employee Benefits.
(a) Employment Matters. Except with respect to those
individuals listed as "Excluded Employees" in Schedule 5.05(a), Purchaser
shall offer (i) to all represented and non-represented employees of Seller
that are engaged primarily in the operation or conduct of the Business as of
the Closing Date (including any employee on vacation, disability, leave of
absence, or layoff, as of the Closing Date) and (ii) to those individuals
listed as "Additional Employees" on Schedule 5.05(a), employment from the
Closing Date at substantially the same salary, wage, or hourly rate (as
applicable), and with other applicable benefits as provided in this Agreement.
"Company Employees" means all non-bargaining unit employees of Seller engaged
in the operation or conduct of the Business as of the Closing Date who accept
the offer of Purchaser pursuant to this Section 5.05(a) and become employees
of Purchaser as of the Closing Date. Except as provided in Section 5.05(b)
below, from and after the Closing Date, Purchaser shall provide on an
uninterrupted basis employee benefits (including, if applicable, group medical
and dental, life insurance, defined contribution retirement plan, short- and
long-term disability, severance, vacation, and sick pay) for Company Employees
which are, in the aggregate for each such employee, no less favorable than the
employee benefits provided to similarly situated employees of Purchaser.
(b) Pension Plans. The following provisions shall be
applicable with regard to pension plans:
(i) Effective as of the close of business on
December 31, 1997, all Company Employees who are participating in the
defined benefit plan or plans maintained by Seller as of such date
(collectively, the "Seller Defined Benefit Plan") shall cease to
accrue benefits in the Seller Defined Benefit Plan.
28
(ii) As soon as practicable after December 31,
1997, and effective as of January 1, 1998, Buyer shall provide under
the tax-qualified defined benefit plan of Buyer (the "Buyer Defined
Benefit Plan") each Company Employee with service credit for
eligibility and vesting purposes (including eligibility for early or
normal retirement) equal to the service credit to the Company
Employees as of December 31, 1997, under the Seller Defined Benefit
Plan and any defined benefit plans maintained by an affiliate of
Seller. The accrued benefit with respect to each Company Employee
under the Buyer Defined Benefit Plan shall be the sum of (1) and (2),
as follows:
(1) The accrued benefit of the Company
Employee under the Seller Defined Pension Plan as of the
close of business on December 31, 1997, but determined by
recognizing compensation earned by such Company Employee for
the Buyer and its Affiliates after December 31, 1997, minus
the accrued benefit of the Company Employee under the Seller
Defined Benefit Pension Plan as of December 31, 1997; and
(2) The accrued benefit of the Company
Employee under the Buyer Defined Benefit, recognizing only
service with Buyer after December 31, 1997.
(c) Past Service Credit. Except as provided in Section
5.05(b), after the Closing Date all service with Seller and its Subsidiaries
shall be counted as service with Purchaser for all purposes, including
eligibility to participate, vesting, and determining the amount of a benefit,
but without duplication of benefits, under the employee benefit plans and
compensation practices (including, if applicable, group medical and dental,
life insurance, defined contribution retirement plan, short- and long-term
disability, severance, vacation, and sick pay) covering or otherwise
benefitting such employees on and after the Closing Date. Purchaser hereby
agrees to take such action as may be necessary or appropriate under all
employee benefit plans and compensation practices covering or otherwise
benefiting Company Employees after the Closing Date to provide for such past
service credit.
(d) Co-payments and Deductibles. Each Company Employee shall
be given credit for any deductible or co-payment amounts paid under Plans
maintained by Seller or its Subsidiaries in respect of the Plan year in which
the Closing Date occurs, to the extent that, following the Closing Date, they
participate in comparable plans maintained by Purchaser for which deductibles
or co-payments are required. Purchaser
29
shall also cause each of its Plans to waive any preexisting condition
requirement to the extent waived under the terms of any Plan maintained by
Seller or its Subsidiaries immediately prior to the Closing Date.
(e) Labor Agreements. To the extent required by applicable
law or the terms of any contract or agreement disclosed in Schedule 3.17 of
the Disclosure Schedule, Purchaser shall honor all labor or collective
bargaining agreements pertaining to employees of Seller or any of its
Subsidiaries that are primarily engaged in the operation or conduct of the
Business as of the Closing Date.
(f) Non-Qualified Retirement Plans. Purchaser hereby agrees
to honor all liabilities to Company Employees and their beneficiaries arising
under all nonqualified, unfunded, deferred compensation programs of Seller or
its Subsidiaries listed on Schedule 5.05(f), including the ▇▇▇▇▇▇ Corp.
Supplemental Executive Retirement Plan (the "▇▇▇▇▇▇ SERP")
(g) Retiree Benefits. Purchaser hereby agrees to provide
retiree (including early retiree) medical benefits to individuals who have
been employed by Seller in the operation or conduct of the Business and who
were or would become eligible for such benefits under Seller's retiree medical
plans as of the Effective Time (as hereinafter defined) if they terminated
their employment on or before the Effective Time and who terminate or had
terminated their employment on or before two business days following the
Effective Time comparable to the retiree medical benefits provided to
similarly situated employees of Seller or, at Purchaser's option, similarly
situated employees of Purchaser. "Effective Time" shall have the meaning
ascribed thereto in the Merger Agreement.
(h) Vacation. Purchaser agrees to provide all vacation
entitlement to Company Employees for the 1997 calendar year as determined
under the Seller's vacation pay policies in effect as of the Effective Time.
(i) Severance Pay. Purchaser hereby agrees to assume and
perform the letter agreements described in Schedule 5.05(i). In the event any
Company Employee is terminated by Purchaser without cause within one year
following the Effective Time, Purchaser shall provide severance pay to such
employee which is not less than the amount such employee would have received
under the severance pay plans and practices of Seller and its Subsidiaries in
effect immediately prior to the Effective Time.
30
(j) COBRA. After the Closing Date, Purchaser agrees to
provide continuation coverage for purposes of Part 6 of Title I of ERISA to
former nonbargaining unit employees of Seller (who were engaged primarily in
the operation or conduct of the Business) and their eligible dependents
comparable to the benefits, as from time to time in effect, provided to
similarly situated employees of Seller.
5.06. Notification of Certain Matters. Seller shall give prompt
notice to Purchaser, and Purchaser shall give prompt notice to the Seller, of
(a) the occurrence or non-occurrence of any event the occurrence or
non-occurrence of which would cause any representation or warranty contained
in this Agreement to be untrue or inaccurate in any material respect, (b) any
material failure of the Seller or Purchaser, as the case may be, to comply
with or satisfy any covenant, condition, or agreement to be complied with or
satisfied by it hereunder, and (c) the commencement or, to the best of their
knowledge, the threat, of any action, suit, claim, investigation, or
proceeding which relates to this Agreement or the transactions contemplated
hereby; provided, however, that the delivery of any notice pursuant to this
Section 5.06 shall not limit or otherwise affect the remedies available
hereunder to the party receiving such notice.
5.07. Expenses. Except as set forth in Section 8, all costs and
expenses incurred in connection with this Agreement and the transactions
contemplated hereby shall be paid by the party incurring such expenses. All
fees and expenses payable to ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ or ▇▇▇▇▇ ▇▇▇▇▇▇ in connection
with the Acquisition or any other transactions under this Agreement shall be
paid by Seller.
5.08. Waiver of Compliance with Bulk Sales Laws. Seller and Purchaser
agree that Purchaser will not notify any creditors of Seller pursuant to any
provisions of any laws relating to "bulk sales" and transfers applicable to
the transactions contemplated hereby. Seller agrees to indemnify Purchaser and
hold it harmless against any and all claims, losses, damages, liabilities,
costs, and expenses incurred by Purchaser as a result of any failure to comply
with any "bulk sales" or similar laws, unless such claim is based on a
liability assumed by Purchaser hereunder.
5.09. Transfer, Sales, and Use Taxes. Seller and Purchaser each shall
be responsible for and shall pay one-half of (a) all transfer, recording, real
estate excise, and other similar Taxes and fees ("Transfer Taxes"), arising
out of or in connection with the transactions contemplated by this Agreement
and (b) all applicable sales and use Taxes ("Sales and Use Taxes"). The party
which has the primary responsibility under applicable law for the payment of
any particular Transfer Taxes or Sales and Use Taxes ("Payor") shall prepare
and file the relevant Tax Return, pay the Transfer Taxes or Sales
31
and Use Taxes shown on such Tax Return, and notify the other party ("Other
Party") in writing of the Transfer Taxes or Sales and Use Taxes shown on such
Tax Return and how such Transfer Taxes or Sales and Use Taxes were calculated,
and the Other Party shall reimburse the Payor for one-half of the amount of
such Transfer Taxes or Sales and Use Taxes in immediately available funds
within ten (10) days of receipt of such notice.
5.10. Purchase Price Allocation. Prior to the Closing, Purchaser and
Seller shall agree to an allocation of the Purchase Price among the Acquired
Assets (the "Allocation"), a copy of which Allocation shall be attached to
this Agreement as Schedule 5.10. Seller and Purchaser shall be bound by and
act in accordance with the Allocation in the preparation and filing of all Tax
returns (including filing Form 8594 with the relevant Federal income Tax
Return for the taxable year that includes the Closing Date) and in any
proceeding before any Governmental Entity pertaining to Taxes. Except as may
otherwise be required by a determination (as defined in Section 1313 of the
Code), Seller and Purchaser shall take no position inconsistent with the
Allocation for Tax purposes. Each of Seller and Purchaser shall provide the
other a copy of its Form 8594 not later than 30 days prior to filing. In the
event that the Allocation is disputed by a Governmental Entity, the party
receiving notice of the dispute shall promptly notify the other party
concerning the nature of the dispute.
5.11. WARN Compliance. Seller shall not, at any time following the
execution of this Agreement, effectuate (i) a "plant closing" (as defined in
the Worker Adjustment Retraining Notification Act of 1988 ("WARN")) affecting
any site of employment or one or more facilities or operating units within any
site of employment or facility of Seller affected by this Agreement, or (ii) a
"mass layoff" (as defined in WARN) affecting any site of employment or
facility of Seller affected by this Agreement, or (iii) layoffs or employment
terminations sufficient in number to trigger application of any similar state
or local law. At the Closing, Seller shall provide Purchaser with a schedule
of all employees of Seller that were engaged primarily in the operation or
conduct of the Business as of the Effective Date who (i) have suffered an
"employment loss" (as defined in WARN), (ii) suffered a layoff, or (iii)
otherwise suffered a reduction in hours in the period between execution of
this Agreement and the Closing Date.
6. CONDITIONS
6.01. Conditions to Each Party's Obligation. The obligation of
Purchaser to purchase the Acquired Assets from Seller, and the obligation of
Seller to sell the
32
Acquired Assets to Buyer, is subject to the satisfaction (or waiver by Seller
and Purchaser) on or prior to the Closing date of the following conditions:
(a) Governmental Approvals. All authorizations, consents,
orders, or approvals of, or declarations or filings with, or expirations of
waiting periods imposed by, any Governmental Entity necessary for the
consummation of the Acquisition shall have been obtained or filed or shall
have occurred.
(b) No Injunctions or Restraints. No applicable law or
injunction enacted, entered, promulgated, enforced, or issued by any
Governmental Entity or other legal restraint or prohibition preventing the
consummation of the Acquisition shall be in effect.
(c) Fairness Opinion. Purchaser and Seller each shall have
received an opinion from a nationally recognized investment banking firm or
other Person satisfactory to both Purchaser and Seller to the effect that, as
of the date hereof, the terms and conditions of the Acquisition as set forth
in this Agreement are fair to each of Purchaser and Seller, from a financial
point of view.
6.02. Conditions to Obligation of Purchaser. The obligation of
Purchaser to purchase and pay for the Acquired Assets is subject to the
satisfaction (or waiver by Purchaser) on or prior to the Closing Date of the
following conditions:
(a) Representations and Warranties. The representations and
warranties of Seller contained in this Agreement qualified as to materiality
shall be true and correct, and those not so qualified shall be true and
correct in all material respects, as of the date hereof and as of the time of
the Closing as though made as of such time, except to the extent such
representations and warranties expressly relate to an earlier date or a single
date (in which case such representations and warranties qualified as to
materiality shall be true and correct, and those not so qualified shall be
true and correct in all material respects, on and as of such earlier date or
such single date), and Purchaser shall have received a certificate signed by
an appropriate officer of Seller to such effect.
(b) Performance of Obligations of Seller. Seller shall have
performed or complied in all material respects with all obligations and
covenants required by this Agreement to be performed or complied with by
Seller by the time of the Closing, and Purchaser shall have received a
certificate signed by an appropriate officer of Seller to such effect.
33
(c) Absence of Proceedings. There shall not be pending or
threatened by any Governmental Entity any proceeding (or by an other person
any proceeding that has a reasonable likelihood of success) (i) challenging or
seeking to restrain or prohibit the Acquisition or any other transaction
contemplated by this Agreement or seeking to obtain from Purchaser or any of
its Affiliates in connection with the Acquisition any damages that are
material in relation to Purchaser, (ii) seeking to prohibit or limit the
ownership or operation by Purchaser or any of its Affiliates of any material
portion of the business or assets of Purchaser (including the Business), or
any of its Affiliates, or to compel Purchaser, or any of its Affiliates, to
dispose of or hold separate any material portion of the business or assets of
Purchaser (including the Business) or any of its Affiliates, in each case as a
result of the Acquisition or any of the other transactions contemplated by
this Agreement, (iii) seeking to impose limitations on the ability of
Purchaser to acquire or hold, or exercise full rights of ownership of, the
Acquired Assets, or (iv) seeking to prohibit Purchaser or any of its
Affiliates from effectively controlling in any material respect the Business.
(d) Financing. Purchaser shall have obtained third party
financing necessary to consummate the Acquisition and to pay all related fees
and expenses, on terms satisfactory to Purchaser.
(e) Consents. Purchaser shall have received written consents
from all third parties necessary or appropriate to effect the Acquisition,
other than such consents the absence of which, individually or in the
aggregate, could not reasonably be expected to have a Material Adverse Effect
on the Business or the Acquired Assets following the Closing.
(f) Clearfield Lease Consent. Without limiting the
generality of Section 6.02(e), Seller shall have received written consent (in
form and substance satisfactory to Purchaser) from the landlord or landlords,
as the case may be, under the real property lease or leases relating to the
Clearfield Facility, consenting to the assignment of such lease or leases by
Seller (as tenant) to Purchaser as contemplated in this Agreement.
(g) Due Diligence. Purchaser shall have completed its due
diligence examination of the Business, the Acquired Assets, the Assumed
Liabilities, and all other matters relating to the Business and the results of
such examination shall be satisfactory in all respects to Purchaser.
34
6.03. Conditions to Obligation of Seller. The obligation of Seller to
sell, assign, convey, and deliver the Acquired Assets is subject to the
satisfaction (or wavier by Seller) on or prior to the Closing Date of the
following conditions:
(a) Representations and Warranties. The representations and
warranties of Purchaser contained in this Agreement qualified as to
materiality shall be true and correct, and those not so qualified shall be
true and correct in all material respects, as of the date hereof and as of the
time of the Closing as though made as of such time, except to the extent such
representations and warranties expressly relate to an earlier date or a single
date (in which case such representations and warranties qualified as to
materiality shall be true and correct, and those not so qualified shall be
true and correct in all material respects, on and as of such earlier date or
such single date), and Seller shall have received a certificate signed by an
authorized officer of Purchaser to such effect.
(b) Performance of Obligations of Purchaser. Purchaser shall
have performed or complied in all material respects with all obligations and
covenants required by this Agreement to be performed or complied with by
Purchaser by the time of the Closing, and Seller shall have received a
certificate signed by an appropriate officer of Purchaser to such effect.
(c) Absence of Proceedings. No court or governmental
authority of competent jurisdiction shall have issued an order (which shall
not subsequently have been vacated), restraining, enjoining, or otherwise
prohibiting the consummation of the Acquisition or any other transaction
contemplated by this Agreement, and no action or proceeding shall have been
instituted (which has a reasonable likelihood of success and which shall not
have been subsequently dismissed), seeking to restrain, enjoin, or prohibit
the consummation of the Acquisition or any other transaction contemplated by
this Agreement or seeking damages in respect thereof.
7. TERMINATION OF AGREEMENT
7.01. Termination.
(a) Termination Events. Notwithstanding anything to the
contrary contained in this Agreement, this Agreement may be terminated and the
Acquisition and the other transactions contemplated by this Agreement
abandoned at any time prior to the Closing:
35
(i) by mutual written consent of Seller and
Purchaser;
(ii) by Seller if any of the conditions set forth
in Sections 6.01 or 6.03 shall have become incapable of fulfillment,
and shall not have been waived by Seller;
(iii) by Purchaser if any of the conditions set
forth in Section 6.01 or 6.02 shall have become incapable of
fulfillment, and shall not have been waived by Purchaser; or
(iv) by Seller or Purchaser, if the Closing does
not occur on or prior to December 31, 1997;
provided, however, that the party seeking termination pursuant to clause (ii),
(iii), or (iv) is not then in breach in any material respect of any of its
representations, warranties, covenants, or agreements contained in this
Agreement.
(b) Notice. In the event of termination by Seller or
Purchaser pursuant to this Section 7.01, written notice thereof shall
forthwith be given to the other party and the transactions contemplated by
this Agreement shall be terminated, without further action by any party.
7.02. Effect of Termination. If this Agreement is terminated and the
transactions contemplated hereby are abandoned as described in Section 7.01,
this Agreement shall become null and void and of no further force and effect,
except for the provisions of (a) Section 5.07 relating to certain expenses,
and (b) Section 7.01 and this Section 7.02. Nothing in this Section 7.02 shall
be deemed to release any party from any liability for any breach by such party
of the terms and provisions of this Agreement or to impair the right of any
party to compel specific performance by any other party of its obligations
under this Agreement.
8. INDEMNIFICATION
8.01. Indemnification by Seller. Seller shall indemnify Purchaser,
its affiliates, and each of their respective officers, directors, employees,
stockholders, agents, and representatives against, and hold them harmless
from, any loss, liability, claim, damage, or expense (including reasonable
legal fees and expenses) (collectively, "Losses"), as incurred (payable
promptly upon written request), arising from, in connection with, or otherwise
with respect to: (a) any breach of any covenant of Seller contained in this
36
Agreement, (b) any Excluded Liability, (c) the failure to comply with
statutory provisions relating to bulk sales and transfers, if applicable, and
(d) any fees, expenses, or other payments incurred or owed by Seller to any
brokers, financial advisors, or other comparable persons retained or employed
by it in connection with the transactions contemplated by this Agreement.
8.02. Indemnification by Purchaser. Purchaser shall indemnify Seller,
its affiliates, and each of their respective officers, directors, employees,
shareholders, agents, and representatives against, and hold them harmless
from, any Loss, as incurred (payable promptly upon written request), for or on
account of or arising from or in connection with or otherwise with respect
37
to: (a) any breach of any covenant of Purchaser contained in this Agreement,
(b) any Assumed Liability, (c) all obligations, liabilities, and commitments
arising out of the operation or conduct of the Business by Purchaser after the
Closing Date, or (d) any fees, expenses, or other payments incurred or owed by
Purchaser to any brokers, financial advisors, or other comparable persons
retained or employed by it in connection with the transactions contemplated by
this Agreement.
8.03. Calculation of Losses. The amount of any Loss for which
indemnification is provided under this Section 8 shall be net of any amounts
actually recovered by the indemnified party under insurance policies with
respect to such Loss and shall be (a) increased to take account of any net Tax
cost incurred by the indemnified party arising from the receipt of indemnity
payments hereunder (grossed up for such increase) and (b) reduced to take
account of any net Tax benefit realized by the indemnified party arising from
the incurrence or payment of any such Loss. In computing the amount of any
such Tax cost or Tax benefit, the indemnified party shall be deemed to
recognize all other items of income, gain, loss, deduction, or credit before
recognizing any item arising from the receipt of any indemnity payment
hereunder or the incurrence or payment of any indemnified Loss.
8.04. Termination of Indemnification. Except as otherwise provided in
Section 9.06 with respect to representations and warranties, the obligations
to indemnify and hold harmless any party pursuant to this Section 8 shall
survive the Closing and shall not terminate.
8.05. Procedures.
(a) In order for a party (the "indemnified party"), to be
entitled to any indemnification provided for under this Agreement in respect
of, arising out of, or involving a claim made by any person against the
indemnified party (a "Third-Party Claim"), such indemnified party must notify
the indemnifying party in writing of the Third-Party Claim promptly following
receipt by such indemnified party of written notice of the Third-Party Claim;
provided, however, that failure to give such notification shall not affect the
indemnification provided hereunder except to the extent the indemnifying party
shall have been prejudiced as a result of such failure (except that the
indemnifying party shall in no event be liable for any expenses incurred
during the period in which the indemnified party failed to give such notice).
Thereafter, the indemnified party shall deliver to the indemnifying party,
promptly following the indemnified party's receipt thereof, copies of all
notices and documents (including court
38
papers) received by the indemnified party relating to the Third-Party Claim
other than those notices and documents separately addressed to the
indemnifying party.
(b) If a Third-Party Claim is made against an indemnified
party, the indemnifying party shall be entitled to participate in the defense
thereof and, if it so chooses, to assume the defense thereof with counsel
selected by the indemnifying party; provided, however, that such counsel is
not reasonably objected to by the indemnified party. Should the indemnifying
party so elect to assume the defense of a Third-Party Claim, the indemnifying
party shall not be liable to the indemnified party for any legal expenses
subsequently incurred by the indemnified party in connection with the defense
thereof. If the indemnifying party assumes such defense, the indemnified party
shall have the right to participate in the defense thereof and to employ
counsel, at its own expense, separate from the counsel employed by the
indemnifying party, it being understood that the indemnifying party shall
control such defense. The indemnifying party shall be liable for the fees and
expenses of counsel employed by the indemnified party for any period during
which the indemnifying party has not assumed the defense thereof (other than
during any period in which the indemnified party shall have failed to give
notice of the Third-Party Claim as provided above).
If the indemnifying party chooses to defend or prosecute a
Third-Party Claim, all the indemnified parties shall cooperate in the defense
or prosecution thereof. Such cooperation shall include the retention and (upon
the indemnifying party's reasonable request) the provision to the indemnifying
party of records and information that are reasonably relevant to such
Third-Party Claim, and making employees available on a mutually convenient
basis to provide additional information and explanation of any material
provided hereunder. If the indemnifying party assumes the defense of a Third-
Party Claim, the indemnified party shall not admit any liability with respect
to, or settle, compromise, or discharge, such Third-Party Claim without the
indemnifying party's prior written consent (which consent shall not be
unreasonably withheld). If the indemnifying party assumes the defense of a
Third-Party Claim, the indemnified party shall agree to any settlement,
compromise, or discharge of a Third-Party Claim that the indemnifying party
may recommend and that by its terms obligates the indemnifying party to pay
the full amount of the liability in connection with such Third-Party Claim,
that releases the indemnified party completely in connection with such
Third-Party Claim, and that would not otherwise adversely affect the
indemnified party.
Notwithstanding the two foregoing paragraphs, the
indemnifying party shall not be entitled to assume the defense of any
Third-Party Claim (and shall be liable for the fees and expenses of counsel
incurred by the indemnified party in defending such
39
Third-Party Claim) if the Third-Party Claim seeks an order, injunction, or
other equitable relief or relief for other than money damages against the
indemnified party that the indemnified party reasonably determines cannot be
separated from any related claim for money damages. If such equitable relief
or other relief portion of the Third-Party Claim can be so separated from that
for money damages, the indemnifying party shall be entitled to assume the
defense of the portion relating to money damages.
(c) Other Claims. In the event any indemnified party should
have a claim against any indemnifying party under Section 8.01 or 8.02 that
does not involve a Third-Party Claim being asserted against or sought to be
collected from such indemnified party, the indemnified party shall deliver
notice of such claim with reasonable promptness to the indemnifying party. The
failure of any indemnified party so to notify the indemnifying party shall not
relieve the indemnifying party from any liability that it may have to such
indemnified party under Section 8.01 or 8.02, except to the extent that the
indemnifying party demonstrates that it has been materially prejudiced by such
failure. If the indemnifying party disputes its liability with respect to such
claim, the indemnifying party and the indemnified party shall proceed in good
faith to negotiate a resolution of such dispute and, if not resolved through
negotiations, such dispute shall be resolved by litigation in an appropriate
court of competent jurisdiction.
9. GENERAL PROVISIONS
9.01. Assignment. This Agreement and the rights and obligations
hereunder shall not be assignable or transferable by any party hereto without
the prior written consent of the other parties hereto. Notwithstanding the
foregoing, without the consent of the other parties hereto, (a) Purchaser may
assign its right hereunder to purchase the Acquired Assets or any portion
thereof (including, but not by way of limitation, the England Shares) to an
Affiliate of Purchaser, and (b) Purchaser may assign its rights hereunder by
way of security and such secured party may assign such rights by way of
exercise of remedies; provided, however, that no assignment or transfer shall
limit or affect the assignor's obligations hereunder. Any attempted assignment
in violation of this Section 9.01 shall be void.
9.02. No Third-Party Beneficiaries. Except as provided in Section 8
with respect to indemnification, this Agreement is for the sole benefit of the
parties hereto and their successors and permitted assigns and nothing herein
expressed or implied shall give or be construed to give to any person, other
than the parties hereto and such successors and assigns, any legal or
equitable rights hereunder.
40
9.03. Amendments and Waivers. This Agreement may not be amended
except by an instrument in writing signed on behalf of each of the parties
hereto. By an instrument in writing Purchaser may waive compliance by Seller,
or Seller may waive compliance by Purchaser, with any term or provision of
this Agreement that such other party was or is obligated to comply with or
perform.
9.04. Notices. All notices and other communications hereunder shall
be in writing and shall be deemed given upon (a) transmitter's confirmation of
a receipt of a facsimile transmission provided that a confirmed delivery by a
standard overnight carrier or a hand delivery is made within two business days
of the date such facsimile is sent or (b) confirmed delivery by a standard
overnight carrier, or (c) when delivered by hand, addressed at the following
addresses (or at such other address for a party as shall be specified by like
notice):
(i) If to Seller, to:
Huntsman Polymers Corporation
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: General Counsel
(ii) If to Purchaser, to:
Huntsman Packaging Corporation
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: General Counsel
9.05. Interpretation. The headings contained in this Agreement, in
any Exhibit or Schedule hereto, and in the table of contents and table of
defined terms to this Agreement are for reference purposes only and shall not
affect in any way the meaning or interpretation of this Agreement. All
Exhibits and Schedules annexed hereto or referred to herein are hereby
incorporated in and made a party of this Agreement as if set forth in full
herein. Any capitalized terms used in any Schedule or Exhibit, but not
otherwise defined therein, shall have the meaning as defined in this
Agreement. When
41
a reference is made in this Agreement to a Section, Exhibit, or Schedule, such
reference shall be to a Section of, or an Exhibit or Schedule to, this
Agreement unless otherwise indicated. Whenever the words "include,"
"includes," or "including," are used in this Agreement, they shall be deemed
to be followed by the words "without limitation." When used in this Agreement,
"Affiliate" of any person means another person that directly or indirectly,
through one or more intermediaries, controls, is controlled by, or is under
common control with, such first person.
9.06. Survival of Agreements. The covenants and agreements of the
parties contained in this Agreement shall survive the Closing and shall not
terminate; provided, however, that the representations and warranties
contained in Section 3 and Section 4 of this Agreement shall not survive the
Closing and shall terminate upon consummation of the Closing.
9.07. Counterparts. This Agreement may be executed in two or more
counterparts, all of which shall be considered one and the same agreement, and
shall become effective when one or more such counterparts have been signed by
each of the parties and delivered to the other parties.
9.08. Entire Agreement. This Agreement, including the Schedules and
Exhibits hereto, contains the entire agreement and understanding among the
parties hereto with respect to the subject matter hereof and supersedes all
prior agreements and understandings relating to such subject matter. No party
shall be liable or bound to any other party in any manner by any
representations, warranties, or covenants relating to such subject matter
except as specifically set forth herein.
9.09. Severability. If any provision of this Agreement (or any
portion thereof) or the application of any such provision (or any portion
thereof) to any person or circumstance shall be held invalid, illegal, or
unenforceable in any respect by a court of competent jurisdiction, such
invalidity, illegality, or unenfoceability shall not affect any other
provision hereof (or the remaining portion thereof) or the application of such
provision to any other persons or circumstances.
9.10. Governing Law; Waiver of Jury Trial; Enforcement. This
Agreement shall be governed by and construed in accordance with the laws of
the State of Utah, without giving effect to the principles of conflicts of law
thereof. Each party to this Agreement (a) waives, to the fullest extent
permitted by applicable law, any right it may have to a trial by jury in
respect of any action, suit, or proceeding arising out of or relating to this
Agreement, (b) consents to submit itself to the personal jurisdiction of
42
any federal court located in the State of Utah or any Utah state court located
in Salt Lake County in the event any dispute arises out of this Agreement or
any of the transactions contemplated by this Agreement, (c) agrees that it
will not attempt to deny such personal jurisdiction by motion or other request
for leave from any such court, and (d) agrees that it will not bring any
action relating to this Agreement or any of the transactions contemplated by
this Agreement in any court other than a federal or state court sitting in
Salt Lake County, State of Utah.
IN WITNESS WHEREOF, Seller and Purchaser have executed this
Agreement as of the day and year first above written.
SELLER:
HUNTSMAN POLYMERS CORPORATION,
a Delaware corporation,
By:
------------------------------
Name:
----------------------------
Title:
---------------------------
PURCHASER:
HUNTSMAN PACKAGING CORPORATION,
a Utah corporation,
By:
------------------------------
Name:
----------------------------
Title:
---------------------------
43
SCHEDULE 1.03(B)
[Attached to and forming a part of the First Amended Asset
Purchase Agreement (the "Agreement") between Huntsman
Polymers Corporation, as "Seller", and Huntsman Packaging
Corporation, as "Purchaser", regarding the assets of the
CT Film Division of Seller (formerly known as ▇▇▇▇▇▇
Corporation). Capitalized terms that are defined in the
Agreement and used in this Schedule shall have the same
meanings as in the Agreement.]
SALES OFFICE LOCATIONS
1. [Southern Region]
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇.
▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
2. [Western Region]
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
44
SCHEDULE 1.03(C)
[Attached to and forming a part of the First Amended Asset
Purchase Agreement (the "Agreement") between Huntsman
Polymers Corporation, as "Seller", and Huntsman Packaging
Corporation, as "Purchaser", regarding the assets of the
CT Film Division of Seller (formerly known as ▇▇▇▇▇▇
Corporation). Capitalized terms that are defined in the
Agreement and used in this Schedule shall have the same
meanings as in the Agreement.]
WAREHOUSE LOCATIONS
1. [Storage Locker #19]
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇.
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
2. [Warehouse -- 5,000 RSF]
Southwest l/4 of Suite 2, on ▇▇▇▇ ▇ & ▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇ of Eagle Point
Chippewa County, WI
3. [Warehouse -- 5,000 S.F.]
Northwest 5,000 S.F. of Suite 2, on ▇▇▇▇ ▇ & ▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇ of Eagle Point
Chippewa County, WI
4. [Warehouse -- 3,500 RSF]
Westerly 3500 S/F (50x70) of
Bldg #2, ▇▇▇ ▇, ▇▇▇▇▇ ▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇ of Eagle Point
Chippewa County, WI
45
5. [Warehouse -- 12,000 RSF]
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇ ▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇
6. [Warehouse -- 40,000 RSF]
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇ ▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇
46
SCHEDULE 1.03(S)
[Attached to and forming a part of the First Amended Asset
Purchase Agreement (the "Agreement") between Huntsman
Polymers Corporation, as "Seller", and Huntsman Packaging
Corporation, as "Purchaser", regarding the assets of the
CT Film Division of Seller (formerly known as ▇▇▇▇▇▇
Corporation). Capitalized terms that are defined in the
Agreement and used in this Schedule shall have the same
meanings as in the Agreement.]
OTHER ACQUIRED ASSETS
1. IBM AS400 Computer and related hardware and equipment
located in Seller's executive offices in Dallas, Texas.
2. Office furniture used by ▇▇▇▇ ▇▇▇▇▇ and office furniture
located in Seller's executive offices in Dallas, Texas and
used by executives of the CT Film Division of Seller.
47
SCHEDULE 1.04(A)
[Attached to and forming a part of the First Amended Asset
Purchase Agreement (the "Agreement") between Huntsman
Polymers Corporation, as "Seller", and Huntsman Packaging
Corporation, as "Purchaser", regarding the assets of the
CT Film Division of Seller (formerly known as ▇▇▇▇▇▇
Corporation). Capitalized terms that are defined in the
Agreement and used in this Schedule shall have the same
meanings as in the Agreement.]
EXECUTIVE OFFICE ACQUIRED ASSETS
1. IBM AS400 Computer and related hardware and equipment
located in Seller's executive offices in Dallas, Texas.
2. Office furniture used by ▇▇▇▇ ▇▇▇▇▇ and other office
furniture located in Seller's executive offices in Dallas,
Texas and used by executives of the CT Film Division of
Seller.
48
SCHEDULE 1.04(E)
[Attached to and forming a part of the First Amended Asset
Purchase Agreement (the "Agreement") between Huntsman
Polymers Corporation, as "Seller", and Huntsman Packaging
Corporation, as "Purchaser", regarding the assets of the
CT Film Division of Seller (formerly known as ▇▇▇▇▇▇
Corporation). Capitalized terms that are defined in the
Agreement and used in this Schedule shall have the same
meanings as in the Agreement.]
OTHER EXCLUDED ASSETS
None.
49
SCHEDULE 1.06(F)
[Attached to and forming a part of the First Amended Asset
Purchase Agreement (the "Agreement") between Huntsman
Polymers Corporation, as "Seller", and Huntsman Packaging
Corporation, as "Purchaser", regarding the assets of the
CT Film Division of Seller (formerly known as ▇▇▇▇▇▇
Corporation). Capitalized terms that are defined in the
Agreement and used in this Schedule shall have the same
meanings as in the Agreement.]
TERMINATED EMPLOYEES
None.
50
SCHEDULE 1.06(G)
[Attached to and forming a part of the First Amended Asset
Purchase Agreement (the "Agreement") between Huntsman
Polymers Corporation, as "Seller", and Huntsman Packaging
Corporation, as "Purchaser", regarding the assets of the
CT Film Division of Seller (formerly known as ▇▇▇▇▇▇
Corporation). Capitalized terms that are defined in the
Agreement and used in this Schedule shall have the same
meanings as in the Agreement.]
OTHER EXCLUDED LIABILITIES
None.
51
SCHEDULE 1.07
[Attached to and forming a part of the Asset Purchase
Agreement (the "Agreement") between Huntsman Polymers
Corporation, as "Seller", and Huntsman Packaging
Corporation, as "Purchaser", regarding the assets of the
CT Film Division of Seller (formerly known as ▇▇▇▇▇▇
Corporation). Capitalized terms that are defined in the
Agreement and used in this Schedule shall have the same
meanings as in the Agreement.]
OTHER LIENS
None.
52
SCHEDULE 3.01
[Attached to and forming a part of the First Amended Asset
Purchase Agreement (the "Agreement") between Huntsman
Polymers Corporation, as "Seller", and Huntsman Packaging
Corporation, as "Purchaser", regarding the assets of the
CT Film Division of Seller (formerly known as ▇▇▇▇▇▇
Corporation). Capitalized terms that are defined in the
Agreement and used in this Schedule shall have the same
meanings as in the Agreement.]
ORGANIZATION, SUBSIDIARIES, ETC.
1. Section 3.1 of the "Company's Disclosure Schedule" to the
Merger Agreement is by this reference incorporated herein
and made a part hereof.
53
SCHEDULE 3.03
[Attached to and forming a part of the First Amended Asset
Purchase Agreement (the "Agreement") between Huntsman
Polymers Corporation, as "Seller", and Huntsman Packaging
Corporation, as "Purchaser", regarding the assets of the
CT Film Division of Seller (formerly known as ▇▇▇▇▇▇
Corporation). Capitalized terms that are defined in the
Agreement and used in this Schedule shall have the same
meanings as in the Agreement.]
NO VIOLATIONS; CONSENTS AND APPROVALS
1. Section 3.4 of the "Company's Disclosure Schedule" to the
Merger Agreement is by this reference incorporated herein
and made a part hereof.
54
SCHEDULE 3.04
[Attached to and forming a part of the First Amended Asset
Purchase Agreement (the "Agreement") between Huntsman
Polymers Corporation, as "Seller", and Huntsman Packaging
Corporation, as "Purchaser", regarding the assets of the
CT Film Division of Seller (formerly known as ▇▇▇▇▇▇
Corporation). Capitalized terms that are defined in the
Agreement and used in this Schedule shall have the same
meanings as in the Agreement.]
SUBSIDIARY CAPITALIZATION
1. Section 3.2(b) of the "Company's Disclosure Schedule" to
the Merger Agreement is by this reference incorporated
herein and made a part hereof.
2. Schedule 3.2(c) of the "Company's Disclosure Schedule to
the Merger Agreement is by this reference incorporated
herein and made a part hereof.
55
SCHEDULE 3.06
[Attached to and forming a part of the First Amended Asset
Purchase Agreement (the "Agreement") between Huntsman
Polymers Corporation, as "Seller", and Huntsman Packaging
Corporation, as "Purchaser", regarding the assets of the
CT Film Division of Seller (formerly known as ▇▇▇▇▇▇
Corporation). Capitalized terms that are defined in the
Agreement and used in this Schedule shall have the same
meanings as in the Agreement.]
ABSENCE OF CERTAIN CHANGES
1. Section 3.6 of the "Company's Disclosure Schedule" to the
Merger Agreement is by this reference incorporated herein
and made a part hereof.
2. Schedule 5.1 of the "Company's Disclosure Schedule to the
Merger Agreement is by this reference incorporated herein
and made a part hereof.
56
SCHEDULE 3.07
[Attached to and forming a part of the First Amended Asset
Purchase Agreement (the "Agreement") between Huntsman
Polymers Corporation, as "Seller", and Huntsman Packaging
Corporation, as "Purchaser", regarding the assets of the
CT Film Division of Seller (formerly known as ▇▇▇▇▇▇
Corporation). Capitalized terms that are defined in the
Agreement and used in this Schedule shall have the same
meanings as in the Agreement.]
NO UNDISCLOSED LIABILITIES
1. Section 3.7 of the "Company's Disclosure Schedule" to the
Merger Agreement is by this reference incorporated herein
and made a part hereof.
57
SCHEDULE 3.08
[Attached to and forming a part of the First Amended Asset
Purchase Agreement (the "Agreement") between Huntsman
Polymers Corporation, as "Seller", and Huntsman Packaging
Corporation, as "Purchaser", regarding the assets of the
CT Film Division of Seller (formerly known as ▇▇▇▇▇▇
Corporation). Capitalized terms that are defined in the
Agreement and used in this Schedule shall have the same
meanings as in the Agreement.]
EMPLOYEE BENEFIT PLANS AND ERISA
1. Section 3.9(a) of the "Company's Disclosure Schedule" to
the Merger Agreement is by this reference incorporated
herein and made a part hereof.
2. Section 3.9(j) of the "Company's Disclosure Schedule" to
the Merger Agreement is by this reference incorporated
herein and made a part hereof.
3. Section 3.9(k) of the "Company's Disclosure Schedule" to
the Merger Agreement is by this reference incorporated
herein and made a part hereof.
58
SCHEDULE 3.09
[Attached to and forming a part of the First Amended Asset
Purchase Agreement (the "Agreement") between Huntsman
Polymers Corporation, as "Seller", and Huntsman Packaging
Corporation, as "Purchaser", regarding the assets of the
CT Film Division of Seller (formerly known as ▇▇▇▇▇▇
Corporation). Capitalized terms that are defined in the
Agreement and used in this Schedule shall have the same
meanings as in the Agreement.]
LITIGATION AND COMPLIANCE WITH LAW
1. Section 3.10 of the "Company's Disclosure Schedule" to the
Merger Agreement is by this reference incorporated herein
and made a part hereof.
59
SCHEDULE 3.10
[Attached to and forming a part of the First Amended Asset
Purchase Agreement (the "Agreement") between Huntsman
Polymers Corporation, as "Seller", and Huntsman Packaging
Corporation, as "Purchaser", regarding the assets of the
CT Film Division of Seller (formerly known as ▇▇▇▇▇▇
Corporation). Capitalized terms that are defined in the
Agreement and used in this Schedule shall have the same
meanings as in the Agreement.]
▇▇▇▇▇▇ INTELLECTUAL PROPERTY
1. Section 3.11 of the "Company's Disclosure Schedule" to the
Merger Agreement is by this reference incorporated herein
and made a part hereof.
60
SCHEDULE 3.11
[Attached to and forming a part of the First Amended Asset
Purchase Agreement (the "Agreement") between Huntsman
Polymers Corporation, as "Seller", and Huntsman Packaging
Corporation, as "Purchaser", regarding the assets of the
CT Film Division of Seller (formerly known as ▇▇▇▇▇▇
Corporation). Capitalized terms that are defined in the
Agreement and used in this Schedule shall have the same
meanings as in the Agreement.]
SELLER AGREEMENTS
1. Section 3.12(a) of the "Company's Disclosure Schedule" to
the Merger Agreement is by this reference incorporated
herein and made a part hereof.
2. Section 3.12(b) of the "Company's Disclosure Schedule" to
the Merger Agreement is by this reference incorporated
herein and made a part hereof.
61
SCHEDULE 3.12
[Attached to and forming a part of the First Amended Asset
Purchase Agreement (the "Agreement") between Huntsman
Polymers Corporation, as "Seller", and Huntsman Packaging
Corporation, as "Purchaser", regarding the assets of the
CT Film Division of Seller (formerly known as ▇▇▇▇▇▇
Corporation). Capitalized terms that are defined in the
Agreement and used in this Schedule shall have the same
meanings as in the Agreement.]
TAXES
1. Section 3.13 of the "Company's Disclosure Schedule" to the
Merger Agreement is by this reference incorporated herein
and made a part hereof.
62
SCHEDULE 3.13
[Attached to and forming a part of the First Amended Asset
Purchase Agreement (the "Agreement") between Huntsman
Polymers Corporation, as "Seller", and Huntsman Packaging
Corporation, as "Purchaser", regarding the assets of the
CT Film Division of Seller (formerly known as ▇▇▇▇▇▇
Corporation). Capitalized terms that are defined in the
Agreement and used in this Schedule shall have the same
meanings as in the Agreement.]
ENVIRONMENTAL MATTERS
1. Section 3.14(a) of the "Company's Disclosure Schedule" to
the Merger Agreement is by this reference incorporated
herein and made a part hereof.
2. Section 3.14(b) of the "Company's Disclosure Schedule" to
the Merger Agreement is by this reference incorporated
herein and made a part hereof.
3. Section 3.14(c) of the "Company's Disclosure Schedule" to
the Merger Agreement is by this reference incorporated
herein and made a part hereof.
4. Section 3.14(d) of the "Company's Disclosure Schedule" to
the Merger Agreement is by this reference incorporated
herein and made a part hereof.
63
SCHEDULE 3.14
[Attached to and forming a part of the First Amended Asset
Purchase Agreement (the "Agreement") between Huntsman
Polymers Corporation, as "Seller", and Huntsman Packaging
Corporation, as "Purchaser", regarding the assets of the
CT Film Division of Seller (formerly known as ▇▇▇▇▇▇
Corporation). Capitalized terms that are defined in the
Agreement and used in this Schedule shall have the same
meanings as in the Agreement.]
NO DEFAULT
1. Section 3.15 of the "Company's Disclosure Schedule" to the
Merger Agreement is by this reference incorporated herein
and made a part hereof.
64
SCHEDULE 3.17
[Attached to and forming a part of the First Amended Asset
Purchase Agreement (the "Agreement") between Huntsman
Polymers Corporation, as "Seller", and Huntsman Packaging
Corporation, as "Purchaser", regarding the assets of the
CT Film Division of Seller (formerly known as ▇▇▇▇▇▇
Corporation). Capitalized terms that are defined in the
Agreement and used in this Schedule shall have the same
meanings as in the Agreement.]
LABOR
1. Section 3.20 of the "Company's Disclosure Schedule" to the
Merger Agreement is by this reference incorporated herein
and made a part hereof.
65
SCHEDULE 4.03
[Attached to and forming a part of the First Amended Asset
Purchase Agreement (the "Agreement") between Huntsman
Polymers Corporation, as "Seller", and Huntsman Packaging
Corporation, as "Purchaser", regarding the assets of the
CT Film Division of Seller (formerly known as ▇▇▇▇▇▇
Corporation). Capitalized terms that are defined in the
Agreement and used in this Schedule shall have the same
meanings as in the Agreement.]
GOVERNMENTAL FILINGS, PERMITS, ETC.
None.
66
SCHEDULE 5.05(A)
[Attached to and forming a part of the First Amended Asset
Purchase Agreement (the "Agreement") between Huntsman
Polymers Corporation, as "Seller", and Huntsman Packaging
Corporation, as "Purchaser", regarding the assets of the
CT Film Division of Seller (formerly known as ▇▇▇▇▇▇
Corporation). Capitalized terms that are defined in the
Agreement and used in this Schedule shall have the same
meanings as in the Agreement.]
EXCLUDED EMPLOYEES AND ADDITIONAL EMPLOYEES
Prior to the Closing, Purchaser and Seller shall agree as to any
employees that are to be designated "Excluded Employees" or
"Additional Employees," and the names of any such employees, with
the agreed designation, shall be added to this Schedule.
67
SCHEDULE 5.05(F)
[Attached to and forming a part of the First Amended Asset
Purchase Agreement (the "Agreement") between Huntsman
Polymers Corporation, as "Seller", and Huntsman Packaging
Corporation, as "Purchaser", regarding the assets of the
CT Film Division of Seller (formerly known as ▇▇▇▇▇▇
Corporation). Capitalized terms that are defined in the
Agreement and used in this Schedule shall have the same
meanings as in the Agreement.]
NONQUALIFIED, UNFUNDED, DEFERRED COMPENSATION PROGRAMS
Prior to the Closing, Purchaser and Seller shall agree as to any
Nonqualified, Unfunded, Deferred Compensation Programs that are to
be included on this Schedule and any such agreed programs shall
be added to this Schedule.
68
SCHEDULE 5.05(I)
[Attached to and forming a part of the First Amended Asset
Purchase Agreement (the "Agreement") between Huntsman
Polymers Corporation, as "Seller", and Huntsman Packaging
Corporation, as "Purchaser", regarding the assets of the
CT Film Division of Seller (formerly known as ▇▇▇▇▇▇
Corporation). Capitalized terms that are defined in the
Agreement and used in this Schedule shall have the same
meanings as in the Agreement.]
LETTER AGREEMENTS FOR SEVERANCE PAY
Prior to the Closing, Purchaser and Seller shall agree as to any
letter agreements for severance pay that are to be included on this
Schedule and any such agreed letter agreements shall be added to
this Schedule.
69
SCHEDULE 5.10
[Attached to and forming a part of the First Amended Asset Purchase
Agreement (the "Agreement") between Huntsman Polymers Corporation,
as "Seller," and Huntsman Packaging Corporation, as "Purchaser,"
regarding the assets of the CT Film Division of Seller (formerly
known as ▇▇▇▇▇▇ Corporation). Capitalized terms that are defined in
the Agreement and used in this Schedule shall have the same
meanings as in the Agreement.]
ALLOCATION OF PURCHASE PRICE
1. The Purchase Price will be allocated among the Acquired
Assets after the Closing by Purchaser and Seller.
2. The Purchase Price will be allocated first among current
assets according to the book value thereof as of the
Closing Date.
3. The balance of the Purchase Price (to the extent
necessary) will next be allocated among property, plant,
equipment, and all other identifiable tangible property,
intangibles, and other assets (other than good will)
according to the appraised value, or Purchaser's and
Seller's best estimate of the fair market value, thereof
as of the Closing Date.
4. The balance of the Purchase Price (if any) will be
allocated to goodwill.
70